---

              C L A S S   A C T I O N   R E P O R T E R
  
              Wednesday, June 26, 2002, Vol. 4, No. 125

                            Headlines

ADVANCED FIBER: Signs MOU To Settle Consolidated Securities Suit in CA
AMERICO FINANCIAL: TX Court Approves Settlement of Insurance Fraud Suit
AMERITECH:  Governor Says Ameritech Securities Suit Settlement Flawed
APARTHEID LITIGATION: More Than 1T Express Interest in Reparations Suit
APARTHEID REPARATIONS: Second Suit Planned Against Several Companies

BYZANTINE CHURCH: Lawsuit Says Diocese Covered Up Child Sexual Abuse
FOAMEX INTERNATIONAL: DE Court Approves Settlement of Securities Suit
G&L REALTY: Trial in Securities Suit Set For February 2003 in CA Court
GLOBAL CROSSING: Agrees To Preserve Documents For NY Securities Suits
GLOBAL EPOINT: Enters Amended Settlement in Securities Suits in CA

GREAT SOUTHERN: 1T Class Members Opt Out of Insurance Suit Settlement
JAPAN: Nomura Securities To Issue Tighter Rules For Securities Analysts
JP MORGAN: Insurance Companies Allege Complicity With Enron Corporation
NETWORK ASSOCIATES: Withdraws Motion To Dismiss Securities Suit in CA
NETWORK ASSOCIATES: CA Court Dismisses Derivative Suit With Prejudice

NETWORK ASSOCIATES: Faces Securities Suits Over McAfee.com Acquisition
PEDIATRIX MEDICAL: FL Court Grants Final Approval To $12M Settlement
RURAL METRO: AZ Court Dismisses Two Defendants From Securities Suit
SERVICE CORPORATION: FL Court Yet To Decide on Certification of Suit
SUN HEALTHCARE: Reaches Agreement To Settle Employee Suit in W.D. WA

SUN HEALTHCARE: NM Court Dismisses Securities Suit Without Prejudice
TOBACCO LITIGATION: Dying New Zealander Sues For Injury, Negligence
TOBACCO LITIGATION: Court Orders RJ Reynolds To Award $15M To Smoker
UNITED STATES: Peanut Quota Holders To Continue With Suit Over Farm Law

*Report Reveals Record-Breaking 483 Securities Suits Filed in 2001

                    New Securities Fraud Cases

ALLIED CAPITAL: Berger & Montague Commences Securities Suit in S.D. NY
APPLIED DIGITAL: Berger & Montague Commences Securities Suit in S.D. FL
CMS ENERGY: Hoffman & Edelson Commences Securities Fraud Suit in MI
CMS ENERGY: Bernard Gross Commences Securities Fraud Suit in E.D. MI
CORPPRO COMPANIES: Schubert & Reed Commences Securities Suit in E.D. OH

KNIGHT TRADING: Kirby McInerney Commences Securities Fraud Suit in NJ
KNIGHT TRADING: Milberg Weiss Lodges Securities Suit in New Jersey
KNIGHT TRADING: Bernard Gross Commences Securities Suit in New Jersey
KNIGHT TRADING: Schiffrin & Barroway Lodges Securities Fraud Suit in NJ
KNIGHT TRADING: Charles Piven Commences Securities Fraud Suit in NJ

LANTRONIX INC.: Stull Stull Commences Securities Fraud Suit in C.D. CA
MERRILL LYNCH: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
MERRILL LYNCH: Finkelstein Thompson Commences Securities Suit in CA
OMNICOM GROUP: Bernard Gross Commences Securities Fraud Suit in S.D. NY
RELIANT RESOURCES: Cauley Geller Lodges Securities Suit in S.D. TX

RELIANT RESOURCES: Rabin & Peckel Lodges Securities Fraud Suit in TX
                              
                            *********


ADVANCED FIBER: Signs MOU To Settle Consolidated Securities Suit in CA
----------------------------------------------------------------------
Advanced Fibre Communications, Inc. (Nasdaq: AFCI) signed a memorandum
of understanding (MOU) providing for a settlement of the consolidated
securities class action pending in the United States District Court for
the Northern District of California.

The suit names as defendants the Company and certain of its former
officers and directors.  The suit alleges various federal and state
securities law violations on behalf of purchasers of the Company's
stock for the period March 25, 1997 through and including June 30,
1998.  

Finalization of the settlement is subject to the execution of
definitive documentation, approval by the district court, and the right
of class members to opt out.  It is expected that the process of
finalizing the settlement will take several months.  Two individual,
non-class actions based on substantially similar allegations remain
pending and are not covered by this settlement.

The total amount of the settlement is $20 million. In connection with
the settlement, the Company expects to record a charge in its second
fiscal quarter of approximately $3 million to cover the portion of the
settlement not expected to be currently funded by insurance.

Under the terms of the memorandum, there would be no finding of
wrongdoing on the part of any of the defendants, or any other finding
that the claims alleged had merit.  The defendants have denied, and
continue to deny, that they have committed any violation of federal
securities or other laws.


AMERICO FINANCIAL: TX Court Approves Settlement of Insurance Fraud Suit
-----------------------------------------------------------------------
The 111th District Court of Webb County, Texas approved a class-wide
settlement and dismissed with prejudice the claims of the class members
in a certified class action in which Americo Financial Life and
Annuity Insurance Company, as well as certain affiliates of the
Company, had been defendants.

The class consists of certain present and former owners of certain
annuities and interest-sensitive life insurance policies issued or
acquired by the Company between January 1, 1993 and October 1, 2001.

The orders approving the settlement are now final, as no appeals were
filed.  The Company has accounted for the anticipated costs of the
settlement in its consolidated financial statements.  


AMERITECH:  Governor Says Ameritech Securities Suit Settlement Flawed
---------------------------------------------------------------------
Attorney General James Doyle of Wisconsin filed a formal objection to a
proposed settlement of a private class action against
telecommunications company Ameritech, alleging that it failed to
disclose the true cost of its voice mail service to customers, The
Milwaukee Journal Sentinel reports.

The class action contends that the Company engaged in consumer fraud by
advertising voice mail for a fixed rate of $4.95 a month, but failed to
tell consumers that they also pay a local phone charge of about five
cents for every message left in their voice mail box.

Under the terms of the settlement, Ameritech voice mail customers who
filed a claim would receive one month free of Speed Dial 30 service.  
In addition, the Company agreed to pay the plaintiffs' lawyers and
disclose information about its voice mail local telephone charges on
its Website and in printed materials sent to customers.  

Governor Doyle said those terms were not acceptable.  "Consumers got
misled by Ameritech, and instead of being offered refunds, they get a
marketing promotion pushed at them that benefits the company," he said.


APARTHEID LITIGATION: More Than 1T Express Interest in Reparations Suit
-----------------------------------------------------------------------
United States attorney Ed Fagan, who is suing Swiss banks UBS and
Credit Suisse Group on behalf of victims of South Africa's apartheid
regime, received more than 1,000 calls over the last five days from
South Africans who want to participate in his class action, AFX News
reported.

Mr. Fagan, who played a key role in compensation claims against Swiss
banks by Holocaust survivors and victims' heirs, filed a class action
against the Swiss banks, among others, with a court in Manhattan,
according to AFX News.  The Swiss banks currently face claims of at
least $80 billion from four victims of South Africa's apartheid regime
over their alleged financial support of the apartheid government.

"The number of people dialing our hotline number has by far exceeded
our expectations," Swiss Sunday paper SonntagsZeitung quoted a member
of Mr. Fagan's team as saying.  The callers will now be sent
questionnaires in order that their claims can be verified.


APARTHEID REPARATIONS: Second Suit Planned Against Several Companies
--------------------------------------------------------------------
Two German banks and American computer firm International Business
Machines (IBM) are the next targets of lawsuits seeking large sums in
reparations for victims of South Africa's apartheid regime, a lawyer
for the case recently told Reuter English News Service in Johannesberg.

Attorney Gugulethu Madlanga told Reuters that a class action against
Dresdner, a unit of German insurer Allianz AG, Deutsche Bank and IBM
could be brought as early as next week.  Mr. Madlanga said a lawsuit
against Ford Motor Company was also under consideration.  

The second class action was expected to make allegations similar to
those made in the first lawsuit filed last week against Swiss-based
Credit Suisse Group and UBS Ag, as well as US-based Citigroup Inc. by
controversial US attorney Ed Fagan.

Mr. Fagan's US$50 billion lawsuit on behalf of four apartheid victims
alleges the banks helped finance the violent apartheid regime and made
billions in desperately needed loans to further the politically
isolated and cash-strapped government's crimes against humanity.

Mr. Madlanga said he has had discussions with the family of slain black
activist Steve Biko over whether the family would be interested in
enlisting as lead plaintiffs in the latest class action being readied.  
"If they decide to go ahead, they will be one of the lead plaintiffs.
but we are still having discussions around the issue - nothing has been
finalized yet," he said.   

Steve Biko's son Nkosinathi, executive chairman of the Steve Biko
Foundation, told Reuters that although he had met with the lawyers, the
family has not yet decided whether it would be involved.

Steve Biko, the leader of South Africa's Black Consciousness Movement,
and subject of the book and smash-hit movie "Cry, Freedom!," was killed
by security forces in 1977 at the age of 31.  He was an iconic figure
in the resistance to apartheid and was seeking to unite student protest
movements when he died after being tortured while in police custody.  
Many would put Steve Biko second only to Nelson Mandela in the pantheon
of anti-apartheid heroes.

Nkosinathi Biko said he was waiting to see documents on the case and
for talks with the rest of the family before deciding what action to
take.  Speaking about his meeting with the attorneys in order to have
an understanding of the second class action, he said there is a valid
case for a class action.  "However, my family has not formulated a
position whatsoever on the matter," he said.

Mr. Biko added that he personally believes less famous victims should
lead such cases.  For example, the lead plaintiff in the current case
is Dorothy Molefi, mother of Hector Petersen, a 13-year old boy, who
was shot by police during a popular uprising against apartheid in June
1976.

Repeating his thesis, Mr. Biko added that he believes strongly "that in
fact the lead plaintiffs in such an action should . be the lesser sung
heroes, that the class action needs to play itself out as such."


BYZANTINE CHURCH: Lawsuit Says Diocese Covered Up Child Sexual Abuse
--------------------------------------------------------------------
A lawsuit, recently filed in Cuyahoga County, Ohio, alleges that the
Byzantine Catholic Diocese of Parma covered up child sex abuse by
priests, the Akron Beacon Journal reports.  

The three men who filed the lawsuit against the Parma Diocese say they
were repeatedly sodomized and abused by the Reverend John Rebovich, the
former pastor of St. Michael Byzantine Catholic Church in Akron.  The
men, identified as Joseph A. Klimko of Garfield and John Doe I and John
Doe II, both of Cleveland, allege they were abused at St. Eugene
Byzantine Catholic Church in Bedford, from about 1978 to 1981, when
they were 15 to 17 years old.

The lawsuit against the Eastern Rite diocese is not the first, nor is
it the first to involve Rev. Rebovich.   In 1990, he was removed from
his post as pastor of St. Michael after a lawsuit was brought accusing
him of raping and sexually molesting an altar boy.  The suit also
accused the diocese of a subsequent cover-up, alleging that church
officials knew of prior allegations of child sex abuse against Rev.
Rebovich in New Jersey.

The plaintiff in the 1990 lawsuit, James Kotyk of Solon, alleged that
on at least two occasions, in 1980, when Mr. Kotyk was 15, Rev.
Rebovich sexually molested him in the rectory of St. Eugene, where the
reverend was pastor.  The first incident occurred on Good Friday 1980,
after Rev. Rebovich took the boy to dinner and persuaded him to spend
the night at the rectory.  The second incident took place in August
1980, after Rev. Rebovich supplied the then 15-year-old James Kotyk
with mixed drinks and took him back to the rectory.

The lawsuit also said that Mr. Kotyk met with diocesan officials in
June 1984 and agreed not to press charges if the church removed Rev.
Rebovich as pastor of St. Eugene, forced him into treatment and banned
him from contact with boys.  The diocese removed Rebovich from St.
Eugene, but less than a month later reinstated him, and that same year
assigned him to St. Michael.

In 1991, the Diocese of Parma settled the Kotyk lawsuit.  Parma Diocese
spokesman the Rev. Nicholas Rachford said no criminal charges were
filed against Rev. Rebovich in 1990, because the prosecutor determined
that the statute of limitations had run out.  

Rev. Rachford declined to comment on the current lawsuit, which alleges
that the church "ratified the priest's conduct by failing to report it"
to law enforcement officials or parishioners and "habitually concealed
records and reports of sexual abuse by Rev. Rebovich."

Rev. Rachford did say, however, he "is not allowed to represent
himself as a priest, and he is not allowed to carry out any priestly
functions."   He also said that although Rev. Rebovich has not been
defrocked, he has not functioned as a priest since 1990, when the
church first heard of the allegations of abuse.

"The diocese knows his whereabouts," said Rev. Rachford, "but is not at
liberty to disclose that information."  The Akron Beacon reported in
1991 that Rev. Rebovich was a doctoral candidate in secondary education
at the University of Akron.

The Byzantine Catholic Church, like the Roman Catholic Church, accepts
the authority of the pope.  Byzantine Catholics, however, express
church life according to the Christian East.  They follow many of their
own rituals and, in some countries, ordain married men.  The United
States has 17 Eastern Rite dioceses as compared with 178 Roman Catholic
dioceses.


FOAMEX INTERNATIONAL: DE Court Approves Settlement of Securities Suit
---------------------------------------------------------------------
The Delaware Court of Chancery approved the settlement proposed by
Foamex International, Inc. relating to the federal and state securities
class actions filed against it since March 1998.

Seven actions were initially filed in the Delaware Court of Chancery,
which were later consolidated into a single suit.  The suit was filed
on behalf of the Company and its stockholders and originally named as
defendants the Company, certain of its current and former directors and
officers, Trace International Holdings, Inc. and a Trace affiliate.

The Delaware suit alleged, among other things, that:

     (1) certain of the defendants breached their fiduciary duties to
         the Company in connection with an attempt by Trace to acquire
         the Company's publicly traded common stock as well as with a
         potential acquisition transaction with a group led by Sorgenti
         Chemical Industries LLC; and

     (2) that certain of the defendants breached their fiduciary  
         duties by causing the Company to waste assets in connection
         with a variety of transactions entered into with Trace and its
         affiliates.  

In April 1999, a putative securities suit was filed in the United
States District Court for the Southern District of New York naming as
defendants the Company, Trace and certain of the Company's current and
former officers and directors.  The suit was filed on behalf of
stockholders who bought shares of the Company's common stock during the
period from May 7, 1998 through and including April 16, 1999.  

The lawsuit alleged that the defendants violated Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 by misrepresenting
and/or omitting material information about the Company's financial
situation and operations, with the result of artificially inflating the
price of Company stock.  The lawsuit also alleged that Trace and
Marshall S. Cogan, the Company's Chairman, violated Section 20(a) of
the Securities Exchange Act of 1934 as controlling persons of the
Company.  

In May 1999, a similar action was filed in the same court. The two
actions were consolidated and a consolidated suit was filed.

In August 2000, the Company and the plaintiffs in the federal action
entered into a settlement agreement providing that members of the class
would receive payments as defined in the agreement.  The court approved
the settlement and dismissed the action with prejudice on January 11,
2001, and no appeals were filed.  

Under the terms of the stipulation of settlement related to the
Delaware suit, the Company agreed that a special nominating committee
of the Board of Directors would nominate two additional independent
directors to serve on the Board.  The terms of the agreement also
established the criteria for the independence of the directors and
required that certain transactions with affiliates be approved by a
majority of the disinterested members of the Board.

In January 2001, the court ordered the Delaware action dismissed with
prejudice only as to the named plaintiffs Watchung Road Associates, LP
and Pyramid Trading Limited Partnership.  The dismissal did not have
any effect on the claims asserted in the consolidated action.

The settlement of the Delaware suit resolved all outstanding
shareholder litigation against the Company and its current and former
directors and officers.  In early January 2002, two shareholders filed
objections to the settlement.  

The settlement hearing was held on February 13, 2002, but was not
concluded.  On March 20, 2002, the Delaware Court concluded the hearing
and approved the settlement.  The settlements of the federal suit and
the Delaware suit involve no admissions or findings of liability or
wrongdoing by the Company or any individual defendants.


G&L REALTY: Trial in Securities Suit Set For February 2003 in CA Court
----------------------------------------------------------------------
The Superior Court for the State of California, Los Angeles County has
set for February 3, 2003, the trial in the consolidated securities
class action pending against the Company and its directors.

The consolidated suit arose out of the proposal by Daniel M. Gottlieb,
the Chief Executive Officer of the Company, and Steven D. Lebowitz, the
President of the Company, to acquire all of the outstanding shares of
the Company's common stock not then owned by them.  The consolidated
suit asserts claims for breach of fiduciary duty and seeks compensatory
damages and other relief.

Another similar suit is pending in the Circuit Court for Montgomery
County, Maryland.   This suit has been stayed by stipulation of the
parties subject to approval of the court.

The Company intends to vigorously defend against the suit, but cannot
give any assurance regarding the outcome of the litigation.


GLOBAL CROSSING: Agrees To Preserve Documents For NY Securities Suits
---------------------------------------------------------------------
A large shareholder of Global Crossing Ltd. has alleged that employees
of the telecommunications company may have destroyed documents,
spurring the Company to reach a special agreement for preserving
remaining documents and computer files, The Wall Street Journal
reports.

The US Bankruptcy Court for the Southern District of New York made
public the agreement after it unsealed the motion filed earlier this
month by the Ohio State Retirement System (Ohio System) alleging
document destruction at the Company.  The agreement between the Company
and Ohio System, however, likely will have little impact on the dozens
of shareholder lawsuits that are expected to be consolidated during the
coming months.  

These lawsuits are directed at the Company's directors and officers,
since the Company itself has immunity under its Chapter 11 bankruptcy
protection filing.  The Company's filing on January 28 was the fourth-
largest filing ever at that time.

The Ohio State Retirement System of the state of Ohio is one of the
largest shareholders of the Company and stands to lose as much as
US$115 million, said Jay Eisenhofer, a lawyer with Grant & Eisenhofer
of Wilmington, Delaware, who represents Ohio System.  

Ohio is one of several states vying for the role of lead plaintiff in
the shareholder class actions.  These lawsuits are expected to focus on
Gary Winnick, the Company's founder and chairman, people familiar with
the thinking on both sides said.  As a class, the shareholders are
expected to receive little or nothing from any restructuring plan at
the Company.

As part of the settlement between the two parties on the issue of a
possible document shredding, the Company's legal counsel, Debevoise
& Plimpton, will give Ohio System information about the legal firm's
progress in collecting documents from staffers, a list of employees
whose computer hard drives have been copied and the measures taken to
preserve these documents.  In all, "more than a million pages of
documents and millions of e-mails," gathered at a cost of between $3
million and $5 million have been preserved, according to Ralph Ferrara,
a Washington, D.C. lawyer at Debevoise & Plimpton.

"Having now completed our investigation, we have concluded that there
is no merit in the allegations and that they remain largely
unsubstantiated," the Company said in a statement.  The Company further
stated, "While we have found isolated incidences of document disposal
in the ordinary course of business, none of the documents involved
appear to have any relevance to pending litigation or governmental
investigations."

The issue, itself, that a possible document shredding may have taken
place, arose out of the clouds of inadvertence.  Investigators for Ohio
and its retirement fund learned of the possible shredding when they
contacted former employees of the company through a Web site where some
had posted their resumes.  Some vague comment seemed suggestive,
although, according to the motion filed by Ohio System's lawyer Jay
Eisenhofer, no one actually had witnessed any document shredding or
found any destroyed documents.  

The sealed motion in which Mr. Eisenhofer made the allegation that the
secretary and son-in-law of Company Executive Vice President Joseph
Perrone may have shredded documents inside a closed work room at the
Company's Madison, New Jersey headquarters first came to light when a
bankruptcy court clerk inadvertently posted the Ohio System's motion on
the court's Web site.  The motion was then unsealed.  Investigators for
Ohio System learned of the possible shredding when they contacted
former Company employees through a Website.


GLOBAL EPOINT: Enters Amended Settlement in Securities Suits in CA
------------------------------------------------------------------
Global Epoint, Inc. has entered an amended settlement agreement in the
consolidated securities class action filed against the Company and
certain officers and directors in the US District Court, Southern
District of California alleging that the Company violated federal
securities laws by the dissemination of materially false and misleading
financial statements.

The court has approved the amended settlement.  Under the amended
settlement agreement, the Company paid $50 thousand in cash and is
permitted to issue shares equal to $950 thousand in value over a period
of time, which is estimated to extend for 12 months.

The Company and the other defendants have denied the liability claims
as part of the amended settlements, but believe that settling the cases
quickly was in the best interests of the Company in order for
management to more effectively proceed with its strategic business
plans.


GREAT SOUTHERN: 1T Class Members Opt Out of Insurance Suit Settlement
---------------------------------------------------------------------
Over a thousand policyholders who were part of a class in a suit
against Great Southern Life Insurance Company opted out of the proposed
settlement in the suit.  

The suit was filed in the United States District Court for the Northern
District of Texas on behalf of certain present and former policyholders
who purchased interest-sensitive whole life and universal life
insurance policies issued or acquired by the Company between January 1,
1982 and December 31, 1999.

The suit also names two of the Company's subsidiaries, Americo
Financial Life and Annuity Insurance Company and Ohio State Life
Insurance Company as defendants.  The suit asserts claims related to
sales practices and premiums charged in connection with certain life
insurance products and sales practices in connection with annuity
products.

The Company pushed for a settlement, which was later approved by the
court.  The court also dismissed the claims of the class members in the
suit.

Under the terms of the settlement, potential class members were given
an opportunity to exclude themselves from the class by sending a
written exclusion notice to the settlement administrator.  Of those
present and former policyholders who filed such notices, over 1,300
have notified the Company that they have retained an attorney to
represent them.

In early February 2002, the Company filed actions in twelve states
against substantially all of these policyholders seeking, among other
things, a declaration of nonliability.  Pursuant to the Company's
request, the Judicial Panel on Multidistrict Litigation issued an order
on March 27, 2002 conditionally transferring the actions filed outside
of Texas to the United States District Court for the Northern District
of Texas for consolidated pretrial proceedings.

Several objections to the conditional transfer order have been filed
which have the effect of staying the transfer order until the panel
rules on the objections.  Several individuals who sent in exclusion
notices also have filed separate actions against the Company in several
states asserting claims related to sales practices and seeking actual
and punitive damages.

The Company is unable to estimate the costs it might incur as a result
of the exclusion notices or if the outcomes of the above-referenced
actions are adverse to it.


JAPAN: Nomura Securities To Issue Tighter Rules For Securities Analysts
-----------------------------------------------------------------------
Japan's top brokerage firm, Nomura Securities Co. Ltd. said it will
implement new rules to strengthen the impartiality of its analysts,
amid concern over the practices of analysts in the United States,
Agence France-Presse reports.

"This situation has arisen in America, (and) given the topic, has been
quite prevalent, we implemented these rules," said James Pobjoy, a
spokesman for Nomura Holdings Inc., a holding company for the
securities firm.  "It is not that the old system lacks stringentness,
we are just strengthening our control," Mr. Pobjoy said.   

Brokerage houses have become acutely aware of their vulnerability to
lawsuits by investors over the conduct of the analysts who hold
themselves out as impartial, but who, in fact, are influenced by their
relationship with the broker, the recent instance of Merrill Lynch
looming large at this time.

A class action was filed last month against Merrill Lynch, accusing it
of making "false and misleading statements" about Internet companies.   
The suit specifically cites the efforts of former Merrill Lynch
Internet analyst Henry Blodget, who became a star during the Internet
boom and was later accused of publicly touting dot-com firms he
privately trashed.

In January, the Japan Securities Dealers Association (JASDA) called on
member securities houses to ensure the independence of analysts' views.  
"Nomura decided to (devise) new rules in line with the decision by
JASDA," Mr. Pobjoy said, stressing that its original guidelines were
already well above the industry standard.

A modified analyst manual will be implemented from July 1 and will
include tighter checks on the flow of reports, according to Mr. Pobjoy,
who added that a US-qualified supervisory analyst will monitor output
to ensure independence.

Established in April 1997, the Nomura Research Center has about 50
analysts who follow the earnings performances and stock prices of some
630 listed firms.


JP MORGAN: Insurance Companies Allege Complicity With Enron Corporation
-----------------------------------------------------------------------
Eleven insurance companies said in new legal documents that JP Morgan
Chase & Co. conspired to make Enron Corporation look healthier than it
was, the Wall Street Journal reports.  Based on legal documents filed
last Friday, the move was reportedly part of an effort to cover the
firm's exposure to the fallen energy giant.  Among the insurers
involved are:

     (1) Liberty Mutual Insurance Co.,

     (2) Safeco Insurance Co.,

     (3) St. Paul Fire & Marine Insurance Co., and

     (4) Citigroup Inc.'s Travelers

The insurance companies hope to use these claims as a defense in a
legal dispute over who should bear the cost of more than $1 billion in
Enron financing gone bad, Reuters reports.

According to the Journal, JP Morgan says the insurers should pay
because they guaranteed with "surety bonds" a series of failed natural-
gas transactions between Enron, JP Morgan and an offshore JP Morgan
company known as Mahonia.  The insurance companies have refused to pay
because they say the arrangements were really loans disguised as
trades.

The documents allege that through Mahonia, JP Morgan bought gas from
Enron, which it then sold back to the energy company at a slightly
better price, the difference representing an effective interest payment
for a JP Morgan loan.


NETWORK ASSOCIATES: Withdraws Motion To Dismiss Securities Suit in CA
---------------------------------------------------------------------
Network Associates, Inc. withdrew its motion to dismiss the
consolidated securities class action pending in the United States
District Court for the Northern District of California.  The suit
asserts claims on behalf of persons who purchased the Company's stock
between July 19 and December 26,2000 against the Company and:

     (1) William Larson,

     (2) Prabhat Goyal and

     (3) Peter Watkins

The complaint asserts causes of action (and seeks unspecified damages)
for alleged violations of Exchange Act Section 10(b)/ SEC Rule 10b-5
and Exchange Act Section 20(a).  In particular, the complaint alleges
that defendants engaged in improper practices designed to increase the
Company's revenues and earnings and that, as a result of those
practices, the Company's class period financial statements were false
and misleading and failed to comply with Generally Accepted Accounting
Principles (GAAP).

The defendants filed a motion to dismiss the consolidated suit in
October 2001, which the plaintiffs opposed. The hearing on the motion
to dismiss was held on April 16, 2002.  On April 26, 2002, the parties
stipulated to the withdrawal of defendants' motion to dismiss.  On
April 29, 2002, the court entered an order that defendants' motion to
dismiss is withdrawn and further ordered the parties to submit a
stipulation and proposed order setting forth a schedule for the filing
of a first amended consolidated suit and the briefing of defendants'
motion to dismiss thereto.


NETWORK ASSOCIATES: CA Court Dismisses Derivative Suit With Prejudice
---------------------------------------------------------------------
The Superior Court in Santa Clara County, California dismissed the
shareholder derivative suit pending against Network Associates, Inc.
(as a nominal defendant) and certain of its officers and directors:

     (1) William Larson,

     (2) Peter Watkins,

     (3) Prabhat Goyal,

     (4) Leslie Denend,

     (5) Virginia Gemmell,

     (6) Edwin Harper,

     (7) Enzo Torresi, and

     (8) other unnamed officers

The suit alleges claims for breach of fiduciary duty, unjust enrichment
and professional negligence against the defendants.  In particular, the
complaints allege that the defendants engaged in a course of conduct by
which they improperly accounted for revenue from software license
sales, and that, as a result of their actions, certain of the
Company's financial statements were false and misleading and not in
compliance with GAAP.

The Company filed a demurrer to the complaint, which was heard by the
court.  The court later sustained the demurrer with leave to amend the
suit.  By order dated August 21, 2001, the court granted plaintiff
limited discovery for purposes of amending the complaint to meet the
demand futility test imposed by Delaware law.

The plaintiffs then filed an amended complaint in December 2001.  The
Company again filed a demurrer, which was joined by the individual
defendants, to the amended complaint in January 2002.  A hearing on the
demurrer was held on March 8, 2002, and the court entered an order on
March 28, 2002 sustaining the demurrer without leave to amend and
dismissing the amended complaint with prejudice.


NETWORK ASSOCIATES: Faces Securities Suits Over McAfee.com Acquisition
----------------------------------------------------------------------
Network Associates, Inc. faces several securities class actions filed
starting March 2002 in the Court of Chancery in the State of Delaware,
County of New Castle, and the Superior Court of the State of
California, County of Santa Clara, arising out of the Company's
proposed acquisition of McAfee.com Corporation.  Another class action
was filed on April 9, 2002 in the United States District Court for the
Northern District of California.

The suits name as defendants the Company and certain of McAfee.com's
officers and directors, and with respect to the Delaware Court of
Chancery actions, McAfee.com.  

Collectively, the lawsuits allege that the defendants breached their
fiduciary duties to the shareholders of McAfee.com in conjunction with
the proposed acquisition by, among other things, failing to maximize
the value of the shares of McAfee.com's common stock and failing to
take adequate procedural measures to protect McAfee.com's shareholders.

On April 2, 2002, defendants removed the California state to the United
States District Court for the Northern District of California.  On
April 4, 2002, plaintiff moved for an order shortening time on his
motion to remand the case to state court and for expedited discovery.

On April 8, 2002, defendants filed a motion to dismiss the California
case under the Securities Litigation Uniform Standards Act of 1998. The
hearing date on this motion is not yet scheduled.


PEDIATRIX MEDICAL: FL Court Grants Final Approval To $12M Settlement
--------------------------------------------------------------------
The United States District Court for the Southern District of Florida
granted a final approval to the US$12 million settlement proposed by
Pediatrix Medical Group, Inc. to settle a securities class action
pending against it and three of its principal officers.

The suit, filed on behalf of all open market purchasers of the
Company's common stock between March 31, 1997, and various dates
through and including April 2, 1999, alleges that during the class
period, the Company violated the antifraud provisions of the federal
securities laws by issuing false and misleading statements concerning
its billing practices and results of operations.

The Company continued to deny wrongdoing in the suit, and said it will
take a fourth-quarter charge of about $750,000 for expenses from the
litigation, while insurance policies will cover all other amounts
relating to it.


RURAL METRO: AZ Court Dismisses Two Defendants From Securities Suit
-------------------------------------------------------------------
The United States District Court for the District of Arizona dismissed
from a securities class action pending against Rural/Metro Corporation,
two of the Company's top officers, but refused to dismiss the Company
and other defendants from the suits.
   
The Company faces several class actions pending in Arizona Superior
Court for Pima County and in the United States District Court for the
District of Arizona.  The suits initially named as defendants the
Company and:

     (1) Warren S. Rustand, former Chairman of the Board and Chief
         Executive Officer of the Company,  

     (2) James H. Bolin, former Vice Chairman of the Board, and

     (3) Robert E. Ramsey, Jr., former Executive Vice President and
         former Director

The suits, which contain virtually identical allegations, were brought
on behalf of a class of persons who purchased the Company's publicly
traded securities including its common stock between April 28, 1997 and
June 11, 1998.   

The state actions seek unspecified damages under the Arizona Securities
Act, the Arizona Consumer Fraud Act, and under Arizona common law
fraud.  The federal suit seeks unspecified damages under Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934, as amended.  

The complaints allege that between April 28, 1997 and June 11, 1998,
the defendants issued certain false and misleading statements regarding
certain aspects of the Company's financial status and that these
statements allegedly caused the Company's common stock to be traded at
artificially inflated prices.  

The complaints also allege that Mr. Bolin and Mr. Ramsey sold stock
during this period, allegedly taking advantage of inside information
that the stock prices were artificially inflated.

In May 1999, the Arizona state court granted the Company's request for
a stay of the state action until the federal action is finally
resolved.  The individual defendants moved to dismiss the federal
action, which the court later granted.  The court however granted the
plaintiffs leave to replead.

In March 2001, the plaintiffs filed a second amended complaint, which
the Company and the individual defendants again moved to dismiss.  In
March 2002, the court granted the motions to dismiss of Mr. Ramsey and
Mr. Bolin with leave to replead and denied the motions to dismiss of
the Company and Mr. Rustand.  The result is that Mr. Ramsey and Mr.
Bolin have been dismissed from the case although the court allowed the
plaintiffs the opportunity to file another suit against those
individuals.  Mr. Rustand and the Company remain defendants.

In its filings with the Securities and Exchange Commission, the Company
states that if the lawsuits were ultimately determined adversely, it
could have a material adverse effect on its business, financial
condition, and results of operations.  It vowed to continue vigorously
defending against the suit.


SERVICE CORPORATION: FL Court Yet To Decide on Certification of Suit
--------------------------------------------------------------------
The Circuit Court of the 17th Judicial Circuit in and for Broward
County, Florida has not released a decision on the motion for class
certification on the suit against Service Corporation International,
after the hearing held May 28,2002.

The suit was commenced in December 2001, against the Company and its
subsidiary SCI Funeral Services of Florida, Inc. d/b/a Menorah Gardens
& Funeral Chapels, on behalf of all persons with burial plots or family
members buried at Menorah Gardens & Funeral Chapels in Florida.

The plaintiffs allege that defendants have failed to exercise
reasonable care in handling remains by secretly:

     (1) dumping remains in a wooded area;

     (2) burying remains in locations other than the ones purchased;

     (3) crushing vaults to make room for other vaults;

     (4) burying remains on top of the other or head to foot rather
         than side-by-side;

     (5) moving remains; and

     (6) co-mingling remains.

The plaintiffs in the Consumer Lawsuit allege that the above conduct
constitutes:

     (i) negligence,

    (ii) tortious interference with the handling of dead bodies,

   (iii) infliction of emotional distress,

    (iv) violation of industry specific state statutes, and

     (v) violation of Florida's Deceptive and Unfair Trade Practices
         Act.

The plaintiffs seek an unspecified amount of compensatory and punitive
damages.  They also seek equitable/injunctive relief in the form of a
permanent injunction requiring defendants to fund a court supervised
program that provides for monitoring and studying of the cemetery and
any disturbed remains to insure their proper disposition.

Since the suits are in preliminary stages and discovery has just
commenced, the Company cannot quantify its ultimate liability, if any,
for the payment of damages or predict the outcome of the litigation.  
The Company intends to continue its investigation and to aggressively
defend itself in the litigation as well as continue to cooperate with
state officials in resolving the issues presented.


SUN HEALTHCARE: Reaches Agreement To Settle Employee Suit in W.D. WA
--------------------------------------------------------------------
Sun Healthcare Group, Inc. agreed to settle several class actions filed
against two of its subsidiaries, SunBridge Healthcare Corporation and
SunDance Rehabilitation Corporation, by their former employees in the
United States District Court for the Western District of Washington.

The plaintiffs sought to represent certain current and former employees
of SunBridge and SunDance who were allegedly not paid appropriate wages
under federal and state law since May and August 1996, respectively.  
Plaintiffs filed claims in the chapter 11 cases in the amount of
approximately $780 million in the SunDance action and $242 million in
the SunBridge action.

Although the Company disputed these claims, the parties executed a
stipulation of settlement, which was signed by the judge presiding over
the chapter 11 cases in the United States Bankruptcy Court for the
District of Delaware.  The settlement provides:

     (1) a general unsecured claim in the chapter 11 cases of up to an
         aggregate US$3 million for the claimants,

     (2) the payment of claimants' attorney's fees up to $300,000, and

     (3) the payment of up to $500,000 to cover the cost of notice to
         prospective claimants in the class and claims administration.

The settlement terms remain subject to court approval.


SUN HEALTHCARE: NM Court Dismisses Securities Suit Without Prejudice
--------------------------------------------------------------------
The United States District Court for the District of New Mexico
dismissed without prejudice the consolidated securities class action
pending against Sun Healthcare Group, Inc. and three of its former
officers.

The consolidated suit alleges, among other things, that the Company did
not disclose material facts concerning the impact that a Medicare
prospective payment system would have on the Company's results of
operations.  

Pursuant to an agreement among the parties, the Company was dismissed
without prejudice in December 2000.  The court later dismissed the
lawsuit with prejudice and entered judgment in favor of the defendants.
On February 14, 2002, the plaintiffs filed a motion to amend the
judgment and to file an amended complaint.

The Company intends to vigorously defend the individual defendants in
this matter, who are indemnified by the Company and covered by the
Company's insurance.


TOBACCO LITIGATION: Dying New Zealander Sues For Injury, Negligence
-------------------------------------------------------------------
A woman dying of lung cancer is suing two tobacco companies in what is
believed to be the first case of its kind against the companies in New
Zealand, The Dominion newspaper reports.  Health Minister Annette King
has described the lawsuit as a test case.

The Invercargill woman filed a suit of more than $300,000 against
British American Tobacco and WD & HO Wills in the High Court at
Auckland on Friday, the Sunday Star-Times reports.  Janice Pou, 51,
mother of two children, who has smoked since 1968, was diagnosed with
terminal lung cancer last year.

Legal aid rules have been an impediment in New Zealand to lawsuits
against the tobacco companies. In 1990 a class action was not filed
because it was denied legal aid.  However, legal aid rules have
loosened since that time, and Trish Fraser, executive director of the
anti-smoking organization ASH, said this case would be a "landmark" for
future litigation against the tobacco companies.

Her lawyer, John French, said that the lawsuit charged the tobacco
companies with negligence.  "It is based on the allegation that the
defendants' conduct in manufacturing, supplying and advertising
cigarettes led to her becoming addicted and she contracted lung cancer
as a result."  The amount sought was made up of $200,000 for pain and
suffering, $50,000 for loss of enjoyment of life, $50,000 for loss of
expectation of life, $1,201 for medical expenses and $27,265 for loss
of earnings.  Mr. John said the amount was realistic, based on personal
injury claim awards, and Ms. Pou would try to get legal aid.

British American Tobacco spokesman Carrick Graham said the Company was
aware of the lawsuit, but had not yet been served with the papers.  
Smoking was a personal choice and people knew the risks, he said.


TOBACCO LITIGATION: Court Orders RJ Reynolds To Award $15M To Smoker
--------------------------------------------------------------------
Top tobacco company RJ Reynolds Tobacco Holdings, Inc. was ordered by a
federal court to pay US$15 million in punitive damages to a smoker
whose legs were amputated, the Associated Press reports.  The ruling is
the latest in a string of multimillion awards against the industry.

Federal Judge John Lungstrum already awarded plaintiff David Burton
close to US$200,000 in compensatory damages in February.  Mr. Burton's
legs were amputated as a result of peripheral vascular disease,
according to AP.

Judge Lungstrum called the Company's concealment of the addictive
nature of tobacco "particularly nefarious."  "The sheer magnitude" of
RJ Reynolds' wealth made it imperative that the award be "high enough
to have at least some impact in order to carry out the statutory
purposes of punishment and deterrence," Judge Lungstrum wrote.

Judge Lungstrum added that the Company's lack of a sincere, convincing
apology "for what it did or for what happened" to Mr. Burton is, in
many respects, "the most disturbing aspect of this case and one which
merits stiff punishment."

The Company told AP that it believed the punitive damages award was
"excessive and unwarranted" and that the Burton verdict should be
overturned on appeal.  Company lawyer Daniel Donohue said in a
statement federal and Kansas state law require that punitive damages be
proportionate to compensatory damages.  "We don't believe there is a
legitimate basis for awarding any punitive damages in this case," he
said.


UNITED STATES: Peanut Quota Holders To Continue With Suit Over Farm Law
-----------------------------------------------------------------------
A lawyer for peanut farmers says he plans to fight the new federal farm
law in court, arguing that the government is not offering enough money
to people whose income depends on quotas abolished by the new law, the
Associated Press Newswires reports.

Members of the Peanut Quota Holders Association voted overwhelmingly
earlier this month to support a class action challenging provisions of
the new law, which abolishes the quota system.  William S. Stone, an
attorney for the association, said he will meet with representatives of
the association in a few days to make the final plans for the suit.  
About 170 of the association's 600 members met at the Albany Civic
Center, in Albany, Georgia, and agreed to challenge the law.

Under the quota system, peanut farmers could purchase or rent licenses,
known as quotas, that guaranteed them a minimum price for peanuts, with
the license establishing the number of pounds of peanuts eligible for
that price.  Farmers who did not have quotas had to settle for far
lower prices.

William Stone, the peanut farmers' attorney, says the farm law clearly
defines the peanut quotas as an asset, and the Constitution prohibits
the government from taking assets without adequate compensation.  "The
question is, what's adequate?" he asked.  "Can Congress take property
for public purposes, set an arbitrary price and pay inadequate
compensation?"

The government is offering 70,000 quota holders a rate of 55 cents per
pound over five years at a cost to taxpayers of about $1.2 billion.
Some quota holders value the asset at between 75 cents and $1.10 per
pound.  "The courts will decide whether 55 cents is just and adequate
compensation," Mr. Stone said.  

The issue has even more complications than "adequate compensation."  
Signed into law by President Bush last month, the legislation abolishes
a Depression-era quota system that maintained lofty prices for American
peanuts, recently more than double the world market rate.  The quota
system is being replaced by a base system similar to that for cotton
and several other crops, in which federal support payments are
calculated from a "base" amount of crop that farmers have typically
produced.

However, many quota holders are widows and retired farmers who have
rented their quotas to younger growers.  Such rentals have had the
blessings of agricultural officials for years.  The rental fees provide
retirement income and cash for property taxes, but since the landowners
did not grow the peanuts, they won't qualify for a base.  In many
cases, the base will be assigned to the renters.  

Without holding a quota, farmers could grow peanuts for export or oil
at a guaranteed price of only $132 per ton.  Under the old system quota
holders were guaranteed $610 per ton for peanuts produced for domestic
consumption.


*Report Reveals Record-Breaking 483 Securities Suits Filed in 2001
------------------------------------------------------------------
2001 was a record-breaking year for securities litigation, as 483 suits
were filed according to an annual review by prominent auditing firm,
PricewaterhouseCoopers LLP.

The 483 suits more than doubled the 201 suits filed in 2000 and the 207
suits filed in 1999.  Last year's suits could be classified into two
categories: 308 suits were filed relating to the allocation of shares
in initial public offerings, and the remaining 175 concerned alleged
accounting abuses.

Charles Laurence of Pricewaterhouse's financial services advisory
practice and author of the report told the Wall Street Journal that in
the first five months of 2001, more than 60% of the 95 suits filed
involved accounting issues.  While most of the companies targeted in
2000 were technology companies, this year, "we have seen a broadening
out of the companies," he adds.  "They include pharmaceutical
companies, oil companies, and utilities as well as high tech
companies."

Most of the IPO suits were directed not only against the companies, but
also against the securities firms that brought them to market, commonly
called the "underwriters."  Most cases involve allegations of
"laddering," when certain investors promised to buy additional shares
of new stocks at progressively higher prices, and rewarding the
underwriters with percentage of the profits they made in the issue and
additional business.  Other suits cited "questionable" accounting
practices, more specifically, improper revenue recognition or
artificially inflated revenue.

The report further stated that the cost of settling lawsuits grew in
2001, with the average settlement costing more than US$17 million as
compared to the US$14 million average of the past five years, the Wall
Street Journal reports.

                    New Securities Fraud Cases

ALLIED CAPITAL: Berger & Montague Commences Securities Suit in S.D. NY
----------------------------------------------------------------------
Berger & Montague, PC initiated a securities class action in the United
States District Court for the Southern District of New York on behalf
of all persons that purchased Allied Capital Management (NYSE:ALD)
common stock between November 14, 2001 and May 16, 2002, against the
Company and:

     (1) William L. Walton, President, Chairman and Chief Executive
         Officer,

     (2) Penni F. Roll, Chief Financial Officer, and

     (3) Arthur Anderson, LLP, its auditor

The complaint alleges that defendants violated the federal securities
laws by making misstatements and/or omissions of material facts in the
Company's public filings with the Securities and Exchange Commission
(SEC) and statements disseminated to the public.

Specifically, the complaint alleges that throughout the class period,
defendants misstated the value of the Company's investments in various
companies including Velocita Corp. and The Loewen Group, Inc.  The
misstatements were made in the Company's public filings with the SEC
and statements to the public as a result of its failure to "mark to
market" or write-down investments that had substantially declined in
value long after it had become apparent that such investments were
being carried on its books at values much higher than their true
values.  The complaint further alleges that the Company misstated its
total assets in its financial statements by carrying its investments
including Velocita Corp. and The Loewen Group, Inc. on its balance
sheet at misleadingly high values.

Further, the complaint alleges that Company auditor, Arthur Andersen,
LLP, violated the federal securities laws by issuing an unqualified
opinion on the Company's financial statements for the year ended
December 31, 2001, and by allowing its unqualified opinion to be
incorporated by reference into the Company's 2001 Form 10-K, which was
filed with the SEC on March 22, 2002.

When the Company's failure to "mark to market" these investments was
revealed to the market on May 16, 2002, its share price plummeted from
its opening price of $26.44 to as low as $20.00 before closing at
$23.20.

For more details, contact Sherrie R. Savett, Barbara A. Podell or
Kimberly A. Walker by Mail: 1622 Locust Street, Philadelphia, PA 19103
by Phone: 888-891-2289 or 215-875-3000 by Fax: 215-875-5715 by E-mail:
InvestorProtect@bm.net or visit the firm's Website:
http://www.bergermontague.com       


APPLIED DIGITAL: Berger & Montague Commences Securities Suit in S.D. FL
-----------------------------------------------------------------------
Berger & Montague, PC initiated a securities class action against
Applied Digital Solutions, Inc. (Nasdaq: ADSXE) and its Chief Executive
Officer, who is also a director, in the United States District Court
for the Southern District of Florida on behalf of all persons or
entities who purchased the Company's common stock between February 11,
2000 and May 10, 2002, inclusive.

The complaint alleges that the defendants violated the federal
securities laws by issuing false and misleading statements during the
class period.  Contrary to their positive statements, defendants,
according to the complaint, were in possession of materially adverse
information regarding the Company's lack of proper accounting controls
and improper revenue recognition at certain subsidiaries, but failed to
disclose this information to investors for more than two years.

On April 18, 2002, the Company disclosed that during the fiscal year
ended December 31, 2001, one of the Company's subsidiaries had been
recognizing revenue without "evidence of customer acceptance prior to
the recognition of certain revenue."  The Company also disclosed that
during the fiscal year ended December 31, 2000, a second subsidiary
"lacked monitoring controls over its accounts receivable and was unable
to provide certain detailed inventory listings for certain general
ledger balances."  The April 18, 2002 disclosure of the Company's
accounting irregularities caused the price of Company stock to plummet
40%.

Approximately three weeks later, on May 9, 2002, defendants claimed
that nearly every major hospital in the West Palm Beach, Florida area
would be equipped with VeriChip scanners, an indispensable component of
the Company's VeriChip technology. However, one day later on May 10,
2002, the truth was disclosed that no hospital had accepted a scanner,
an essential device for retrieving the VeriChip's information.

Following the May 10, 2002 disclosure, the price of Company stock again
fell sharply, dropping nearly 30% in a single day.

For more details, contact Sherrie R. Savett, Barbara A. Podell, Robin
Switzenbaum or Kimberly A. Walker by Mail: 1622 Locust Street,
Philadelphia, PA 19103 by Phone: 888-891-2289 or 215-875-3000 by Fax:
215-875-5715 by E-mail: InvestorProtect@bm.net or visit the firm's
Website:  http://www.bergermontague.com


CMS ENERGY: Hoffman & Edelson Commences Securities Fraud Suit in MI
-------------------------------------------------------------------
Hoffman & Edelson, LLC initiated a securities class action in the
United States District Court for the Eastern District of Michigan, on
behalf of purchasers of the securities of CMS Energy Corporation
(NYSE:CMS) between August 3, 2000 and May 10, 2002, inclusive, against
the Company and certain of its officers and directors.

The complaint charges that defendants violated Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of materially false and misleading
statements to the market between August 3, 2000 and May 10, 2002.

According to the complaint, the Company had, throughout the class
period, improperly recognized approximately $4.4 billion in revenues by
engaging in transactions lacking any economic substance using what are
known as "round-trip" trading transactions.

The improperly recognized revenues were, according to the complaint,
reported in the Company's quarterly and annual press releases and in
financial filings with the Securities and Exchange Commission (SEC),
throughout the class period.

On May 10, 2002, the Company announced that the SEC was investigating
the propriety of its "round-trip" trading practices.  In response to
the announcement, the Company's common stock price collapsed, falling
from a high of $20.06 on May 10, 2002 to a low of $15.72 on May 13,
2002, a drop of more than 21% on extremely heavy trading volume.

For more details, contact Jerold B. Hoffman by Mail: 45 W. Court
Street, Doylestown, PA 18901 by Phone: 877-537-6532 (toll free) by Fax:
215-230-8735 or by E-mail: jhoffman@hofedlaw.com


CMS ENERGY: Bernard Gross Commences Securities Fraud Suit in E.D. MI
--------------------------------------------------------------------
The Law Offices of Bernard M. Gross, PC initiated a securities class
action in the United States District Court for the Eastern District of
Michigan, on behalf of all purchasers of the securities of CMS Energy
Corporation (NYSE: CMS) between August 3, 2000 and May 10, 2002,
inclusive.  The suit is pending against the Company and Consumers
Energy Company, William T. McCormick, Jr., David W. Joos and Alan M.
Wright.

The complaint charges the defendants with violations of Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder.  Specifically, the complaint alleges that
during the class period, defendants issued materially false and
misleading financial statements.  The defendants misrepresented the
Company's business, operations and financial performance and caused
Company securities to trade at artificially inflated prices.

The improperly recognized revenues were, according to the complaint,
reported in the Company's quarterly and annual press releases and in
financial filings with the Securities and Exchange Commission (SEC),
throughout the class period.

On May 10, 2002, the Company announced that the SEC was investigating
the propriety of its "round-trip" trading practices.

In response to the announcement, Company common stock price collapsed,
falling from a high of $20.06 on May 10, 2002 to a low of $15.72 on May
13, 2002 - a drop of more than 21% on extremely heavy trading volume.

For more details contact Deborah R. Gross or Susan Gross by Mail: 1515
Locust Street, Second Floor, Philadelphia, PA 19102 by Phone:
800-849-3120 (toll-free), 866-561-3600 (toll-free) or 215-561-3600 by
E-mail: susang@bernardmgross.com or debbie@bernardmgross.com or visit
the firm's Website: http://www.bernardmgross


CORPPRO COMPANIES: Schubert & Reed Commences Securities Suit in E.D. OH
-----------------------------------------------------------------------
Schubert & Reed LLP initiated a securities class action in the United
States District Court for the Eastern District of Ohio against Corppro
Companies, Inc. (AMEX:CO) and certain of its officers and directors, on
behalf of all persons who purchased Company common stock during the
period April 1, 2000 through March 20, 2002 inclusive.

The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder by issuing a series of materially false and misleading
statements concerning the Company's financial results that had the
effect of artificially inflating the price of Atchison common stock
during the class period.

Specifically, on March 20, 2002, the Company announced that it had
discovered accounting irregularities causing its consolidated operating
income before taxes through December 31, 2001 to be inflated by between
$4.5 and $5.3 million.  

In addition, the Company announced that as a result of these
"irregularities," it is expected to have to take a charge to pre-tax
earnings in the Company's fiscal fourth quarter ending March 31, 2002
of between $5.3 and $6.7 million. The irregularities are alleged to
have occurred at the Company's Australian subsidiary and appear to date
back to at least calendar year 2000.  

The Company "expects" that it will have to restate its audited
financial statements for the March 31, 2001 fiscal year as well as
unaudited financial results for the first nine months through December
31, 2001 of its fiscal year ending March 31, 2002.

The Company also admitted that, due to the irregularities and likely
restatement, it will be in default under the financial covenants of its
senior secured credit agreement and its senior note facility. Upon
default, its lenders may accelerate repayment of principal, which could
have a material adverse impact on the Company's liquidity, its
financial position and/or its ability to operate as a going concern.
The Company also announced that it had replaced its CFO, the fourth CFO
the Company had employed in the past three years.

For more details, contact Robert C. Schubert or Juden Justice Reed, by
Mail: Two Embarcadero Center, Suite 1660, San Francisco, CA 94111 by
Phone: 415-788-4220 by Fax: 415-788-0161 or by E-mail: mail@schubert-
reed.com.


KNIGHT TRADING: Kirby McInerney Commences Securities Fraud Suit in NJ
---------------------------------------------------------------------
Kirby McInerney & Squire, LLP initiated a securities class action in
the United States District Court for the District of New Jersey on
behalf all persons who purchased securities of Knight Trading Group,
Inc. (Nasdaq:NITE) in the period between February 29, 2000 and June 3,
2002.

The suti charges the Company and Kenneth D. Pasternak, its CEO, during
the specified time period, with violations of sections 10(B) and 20(a)
of the Securities Exchange Act of 1934.  Among other things, plaintiff
claims that defendants' material omissions and materially false and
misleading statements regarding the nature of the Company's trading
practices, caused Company stock price to become artificially inflated,
inflicting damages on investors.

The suit alleges that defendants' class period statements regarding the
Company's financial performance and trading practices were materially
false and misleading because they failed to disclose and/or
misrepresented, among other things:

     (1) that the Company's employees were engaging in an elaborate
         system of trading-rule violations known as "front-running," in
         which customer orders were delayed while defendants' traders
         made purchases in the same stocks ordered by customers,
         thereby benefiting themselves at the expense of the customer;
         and

     (2) that the Company's front-running practices subjected the
         Company to the heightened risk that it would be sanctioned by
         the National Association of Securities Dealers (NASD).

On June 3, 2002, the Company disclosed that its trading practices are
being investigated by both the Securities and Exchange Commission and
the NASD.  Following this announcement, on June 4, 2002, when the
market opened for trading, its shares plummeted 28% from the previous
day's close.

For more details, contact Ira M. Press or Michele Kennedy by Mail: 830
Third Avenue, 10th Floor, New York, New York 10022 by Phone:
212-317-2300 or Toll Free 888-529-4787 by E-Mail: mkennedy@kmslaw.com
or visit the firm's Website: http://www.kmslaw.com


KNIGHT TRADING: Milberg Weiss Lodges Securities Suit in New Jersey
------------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP commenced a securities class
action on behalf of purchasers of the securities of Knight Trading
Group, Inc. (Nasdaq: NITE) between February 29, 2000 and June 3, 2002,
inclusive, in the United States District Court, District of New Jersey
against the Company and Kenneth D. Pasternak.

The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of material misrepresentations to the
market between February 29, 2000 and June 3, 2002, thereby artificially
inflating the price of Company securities.

The complaint alleges that throughout the class period, defendants
issued statements regarding the Company's financial performance and
trading practices.  As alleged in the suit, these statements were
materially false and misleading because they failed to disclose and/or
misrepresented, among other things:

     (1) that Company traders were engaging in an elaborate system of
         trading-rule violations known as "front-running," in which
         customer orders were delayed while defendants' traders made
         purchases in the same stocks ordered by customers, thereby
         benefiting themselves at the expense of the customer; and

     (2) that the Company's front-running practices subjected the
         Company to the heightened risk that it would be sanctioned by
         the National Association of Securities Dealers.

On June 3, 2002, the last day of the class period, the Company
disclosed that its trading practices were being investigated by both
the Securities and Exchange Commission and the NASD.  Following this
announcement, on June 4, 2002, when the market opened for trading,
shares of the Company plummeted 28% from the previous day's close.

For more details, contact Steven G. Schulman or Samuel H. Rudman by
Mail: One Pennsylvania Plaza, 49th fl., New York, NY 10119-0165 by
Phone: 800-320-5081 by E-mail: KnightCase@milbergNY.com or visit the
firm's Website: http://www.milberg.com


KNIGHT TRADING: Bernard Gross Commences Securities Suit in New Jersey
---------------------------------------------------------------------
The Law Offices of Bernard M. Gross, PC initiated a securities class
action lawsuit in the United States District Court for the District of
New Jersey, on behalf of all purchasers of the securities of Knight
Trading Group, Inc.(NASDAQ: NITE) between February 29, 2000 and June 3,
2002, inclusive.  The suit is pending in the United States District
Court, District of New Jersey against the Company and Kenneth
Pasternak.

The complaint charges the defendants with violations of Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder.  Specifically, the complaint alleges that
during the class period, defendants employed a scheme wherein they
issued public statements in press releases which failed to disclose
that Company traders were engaging in an elaborate system of trading-
rule violations known as "front running", in which customer orders were
delayed while defendants' traders made purchases in the same stocks
ordered by customers.

The Company's traders would then, only after they had made their own
purchases, process customers' orders, which drove up the prices of the
stocks and provided an illegal windfall to the defendants who were
reaping profits that should have gone to their customers.

By delaying customer purchases, Company traders prevented those
customers from obtaining the proceeds resulting from rising stock
prices for the period of time that customers' orders were left
unfilled, while defendants siphoned off profits that would have
otherwise accrued to the customers during that time.

Moreover, when customer orders finally were executed, the stock prices
were, as a result of defendants' front-running, more expensive for the
customers who initially had placed the orders. Defendants were aware of
the true nature of the Company's illegal trading scheme, but failed to
disclose the practice to investors.

Instead of disclosing the Company's front-running, defendants concealed
the scheme to artificially inflate the Company's share prices and reap
unwarranted profits.

For more details, contact Deborah R. Gross or Susan Gross by Mail: 1515
Locust Street, Second Floor, Philadelphia, PA 19102 by Phone:
800-849-3120 or visit the firm's Website: http://www.bernardmgross.com   


KNIGHT TRADING: Schiffrin & Barroway Lodges Securities Fraud Suit in NJ
-----------------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in the
United States District Court for the District of New Jersey on behalf
of all purchasers of the common stock of Knight Trading Group, Inc.
(Nasdaq: NITE) from February 29, 2000 through June 3, 2002, inclusive.

The complaint charges the Company and certain of its officers and
directors with issuing false and misleading statements.  Specifically,
the complaint alleges that throughout the class period, defendants
issued statements regarding the Company's financial performance and
trading practices. As alleged in the complaint, these statements were
materially false and misleading because they failed to disclose and/or
misrepresented, among other things:

     (1) that Company traders were engaging in an elaborate system of
         trading-rule violations known as "front-running," in which
         customer orders were delayed while defendants' traders made
         purchases in the same stocks ordered by customers, thereby
         benefiting themselves at the expense of the customer; and

     (2) that the Company's front-running practices subjected the
         Company to the heightened risk that it would be sanctioned by
         the National Association of Securities Dealers (NASD).

On June 3, 2002, the last day of the class period, the Company
disclosed that its trading practices were being investigated by both
the Securities and Exchange Commission and the NASD.  Following this
announcement, on June 4, 2002, when the market opened for trading,
shares of the Company plummeted 28% from the previous day's close.

For more details, contact Marc A. Topaz or Stuart L. Berman by Mail:
Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone:
888-299-7706 (toll free) or 610-667-7706 by E-mail: info@sbclasslaw.com
or visit the firm's Website: http://www.sbclasslaw.com


KNIGHT TRADING: Charles Piven Commences Securities Fraud Suit in NJ
-------------------------------------------------------------------
The Law Offices of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired Knight Trading Group,
Inc. (Nasdaq:NITE) securities between February 29, 2000 and June 3,
2002, inclusive, in the United States District Court for the District
of New Jersey, against the Company and Kenneth D. Pasternak.

The action charges that defendants violated 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 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


LANTRONIX INC.: Stull Stull Commences Securities Fraud Suit in C.D. CA
----------------------------------------------------------------------
Stull Stull & Brody initiated a securities class action in the United
States District Court for the Central District of California, Southern
Division, on behalf of purchasers of Lantronix, Inc. (NASDAQ:LTRX)
securities between April 25, 2001 and May 30, 2002, inclusive. Those
who traded in their Synergetic Micro Systems, Inc. or Premise Systems,
Inc. shares for Company shares during the class period are also
included in the suit.

The complaint alleges that the Company and certain of its officers and
directors violated the federal securities laws by, among other things,
issuing false misleading statements regarding the Company's financial
condition as well as its present and future business prospects.

More specifically, on February 6, 2002, the Company issued a press
release disclosing that the Company would retroactively record a charge
to its 1Q 2002 financial results, miss its forecasts for 2Q 2002, and
lower its outlook for 3Q 2002 and fiscal 2002, due to a purported
change in its method of accounting for revenue.  Shortly thereafter,
the Company terminated the employment of Steven Cotton, the Company's
Chief Financial Officer and Chief Operating Officer.

For more details, contact Marc L. Godino by Phone: 888-388-4605 by E-
mail: mgodino@secfraud.com or visit the firm's Website:
http://www.secfraud.com


MERRILL LYNCH: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
--------------------------------------------------------------------
Kaplan Fox and Kilsheimer LLP initiated a securities class action
against Merrill Lynch & Co., Inc., and certain of its officers and
directors, in the United States District Court for the Southern
District of New York on behalf of all persons or entities who purchased
or otherwise acquired Merrill Lynch's Internet Architecture HOLDRS
Trust (AMEX: IAH) between February 10, 2000 and April 8, 2002,
inclusive.

The complaint alleges that Merrill Lynch and certain of its officers
and directors violated the federal securities laws.  The complaint
alleges, among other things that during the class period defendants
issued a series of false and misleading statements to the market about
the IAH Trust, which is comprised of 20 specified companies involved in
the "internet architecture" business. These companies were selected
because they were involved in the key aspects of the Internet supplying
hardware and software to keep internet companies operational and
profitable.

Taking advantage of the profitable Internet wave, Merrill Lynch created
multiple trusts that were composed of underlying securities of
companies in the technology sector. Research analysts at Merrill Lynch
issued inflated rating and biased reports for the companies whose
stocks comprised the trusts and for additional Internet stocks. In so
doing, defendants created a false demand for the securities that
comprised the trusts, including the Internet Architecture HOLDRS, which
in turn inflated the price of the trusts as well.

Merrill Lynch engaged in such conduct despite knowing that the
valuation of the Internet companies cold not be sustained, and that
eventually fall in value. As a result, investors were damaged, by
purchasing Internet Architecture HOLDRS Trust at artificially inflated
levels during the class period.

For more details, contact Frederic S. Fox, Jonathan K. Levine or Donald
R. Hall by Mail: 805 Third Avenue, 22nd Floor, New York, NY 10022 by
Phone: 800-290-1952 by Fax: 212-687-7714 or by E-mail:
mail@kaplanfox.com


MERRILL LYNCH: Finkelstein Thompson Commences Securities Suit in CA
-------------------------------------------------------------------
Finkelstein, Thompson & Loughran initiated a securities class action
against Merrill Lynch & Co., Inc. and the head of its Internet group,
Henry Blodget, on behalf of purchasers of Openwave Systems Inc.
(Nasdaq: OPWV) securities between October 16, 2000 and August 13, 2001,
inclusive.

The suit, filed in the United States District Court for the Northern
District of California, alleges that Merrill Lynch and its well-known
Internet stock analyst Henry Blodget violated the federal securities
laws by knowingly issuing false and misleading analyst reports
regarding these "new economy" companies during the class period.

Based on e-mails and other internal Merrill Lynch communications, which
were made public as a result of the investigation conducted by the New
York State Attorney General, Eliot L. Spitzer, the suit alleges that
Defendants failed to disclose a significant conflict of interest
between their investment banking and research departments.

Specifically, the suit alleges that Henry Blodget and other Merrill
Lynch analysts issued very favorable analyst reports regarding these
"new economy" companies to the public when they allegedly knew that the
positive recommendations were unwarranted and false.

The complaint further alleges that, unbeknownst to the investing
public, Merrill Lynch's buy recommendations and price targets for these
"new economy" companies were driven by its efforts to attract lucrative
investment banking business from these "new economy" companies rather
than by the companies' fundamental merits.

For more details, contact Adam T. Savett by Phone: 866-592-1960 or by
E-mail: ats@ftllaw.com or Donald J. Enright by Phone: 866-592-1960 or
by E-mail: dje@ftllaw.com or visit the firm's Website:
http://www.ftllaw.com


OMNICOM GROUP: Bernard Gross Commences Securities Fraud Suit in S.D. NY
-----------------------------------------------------------------------
The Law Offices of Bernard M. Gross, PC initiated a securities class
action in the Southern District of New York on behalf of purchasers of
the securities of Omnicom Group, Inc. (NYSE: OMC) between April 25,
2000 and June 11, 2002, inclusive.

The action is pending in the United States District Court, Southern
District of New York, against the Company and:

     (1) John D. Wren,

     (2) Randall J. Weisenburger,

     (3) Bruce Crawford, and

     (4) Philip J. Angelastro

The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder, by issuing materially false and misleading statements to
the market.  Specifically, the complaint alleges among other things,
that the Company had transferred its minority investments in various
Internet companies to a newly formed entity (Seneca), enabling it to
avoid writing down the value of its investments in those companies or
reporting the operating losses from those business.

On June 17, 2002, the Company acknowledged that it had received an
informal request from the SEC relating to two directors who had
reportedly resigned from its board for reasons relating to Seneca. As
reported in The Wall Street Journal, one director, who had served on
Company's Board for 10 years, resigned on May 22, 2002 after
questioning whether adequate disclosures were made to the Board about
the off-loading of certain investments into Seneca and the buy back of
two Internet firms from Seneca.

Richard Beattie also quit the Board on January 2002. Beattie informed
the Company that he had to leave because of other demands on his time,
but, according to The Wall Street Journal, people familiar with the
matter say that he was privately frustrated with the short shrift
Company executives gave directors.

The Company has indicated that it will respond to the SEC's request for
information.

In addition to the allegations relating to Seneca, the complaint
alleges that defendants fraudulently and misleadingly reported growth
in "organic" revenue that included revenue generated by newly acquired
companies, failed to disclose the Company's future obligations relating
to its prior acquisitions, and failed to disclose its contingent
obligations to make additional investments in certain partially
acquired companies.

For more details, contact Susan Gross and Deborah R. Gross by Mail:
1515 Locust Street, 2nd Floor, Philadelphia, PA 19102 by Phone:
800-849-3120 or visit the firm's Website: http://www.bernardmgross.com  


RELIANT RESOURCES: Cauley Geller Lodges Securities Suit in S.D. TX
------------------------------------------------------------------
Cauley Geller Bowman & Coates, LLP initiated a securities class action
in the United States District Court for the Southern District of Texas,
Houston Division on behalf of purchasers of Reliant Energy, Inc. (NYSE:
REI) and Reliant Resources, Inc. (NYSE: RRI) publicly traded securities
during the period between May 14, 1999 through May 9, 2002, inclusive.

The complaint charges Reliant Energy, Inc. and certain of its officers
and directors with issuing false and misleading statements concerning
its business and financial condition.  Specifically, the complaint
alleges that on May 10, 2002 and May 13, 2002, defendants disclosed
that the revenue of the Reliant Companies had been artificially
inflated due to power trading transactions involving simultaneous
purchases and sales at the same price (referred to as "round-trip"
trades).

Defendants further disclosed that these "round trip" trades had the
effect of materially and artificially increasing reported revenues over
the three-year period of 1999, 2000 and 2001.

For more details, 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
Website: http://www.classlawyer.com


RELIANT RESOURCES: Rabin & Peckel Lodges Securities Fraud Suit in TX
--------------------------------------------------------------------
Rabin & Peckel LLP initiated a securities class action in the United
States District Court for the Southern District of Texas on behalf of
all persons or entities who purchased Reliant Resources, Inc.
securities (NYSE:RRI) between May 14, 1999 and May 5, 2002, both dates
inclusive.  The suit names as defendants the Company and:

     (1) R. Steve Letbetter,

     (2) Steven W. Naeve, and

     (3) Mary P. Ricciardello

The suit alleges that defendants violated section 11 of the Securities
Act of 1933, section 10(b) of the Securities and Exchange Act of 1934,
and SEC Rule 10b-5 by issuing a series of materially false and
misleading statements concerning the Company's business and financial
condition.

The complaint alleges that the Texas-based Company issued statements
regarding its quarterly and annual financial performance and filed
reports confirming such performance with the United States Securities
and Exchange Commission (SEC).  The complaint alleges that these
statements were materially false and misleading because, among other
things:

     (i) the Company's revenues in 1999 and 2000 were materially
         overstated because 10% of such revenues represented purchases
         and sales with the same counter-party at the same price, or
         so-called "round trip trades"; and

    (ii) the Company improperly accounted for certain transactions in
         its conventional accrual accounts as cash flow hedges.

On May 10, 2002, the last day of the class period, the Company
announced that it was canceling a $500 million private placement debt
offering that had been priced on May 9, 2002, due in part, to having
engaged in "round trip" trades. Following this announcement, the
Company common stock fell from a high of $15.10 on May 9, 2002 to a low
of $11.10 on May 10, 2002, or a single-day decline of more than 25% on
high trading volume and a decline of more than 55% from the class
period high.

For more details, contact Eric Belfi or Sharon Lee 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.  


                              *********

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  * * *