/raid1/www/Hosts/bankrupt/CAR_Public/020813.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, August 13, 2002, Vol. 4, No. 159
Headlines
AUSTRALIA: High Court Rules Government's Asylum Rejections Invalid
CALIFORNIA: Judge Orders Lawyers To Reach Pact Over Disabled Children
CALIFORNIA: National Guard Plane Starts Fire, Lawsuit Seems Likely
CANADA: Victoria's Supreme Court Chief Executive Sues Over Poison Fish
CATHOLIC CHURCH: Abuse Records Ordered Open, Partial Sealing Overturned
CITIZENS INC.: Court Certifies Suit Over Illegal Insurance Marketing
CONNECTICUT: Female Guards Sue Corrections Dept For Sexual Harassment
FLORIDA POWER: Prevails as Jury Says Firm Did Not Discriminate V. Age
GERMANY: Plans To Allow Small Shareholders To File Suit Against Firms
HAWAII MEDICAL: Doctors Sue, Alleging Unfair, Fraudulent Practices
HUDSON'S BAY: Labels Without Merit Simpsons Employees' Allegations
MARSHALL FIELDS: Five Women File Lawsuit Over "Fake" Vera Wang Gowns
MASSACHUSETTS: Bristol County Jail Inmates Sue Over Cell-And-Board Fees
MCKESSON WATER: Black Drivers Settle Suit Over Racial Discrimination
NCS HEALTHCARE: Faces Suit Over Proposed Merger With Genesis Health
PEOPLES ENERGY: Settling As Gas Outage Leaves 4,500 Without Heat in IL
PEROT SYSTEMS: Faces Seven Lawsuits Over Aid Given To Energy Firms
SUNBEAM CORPORATION: Reaches $141 Million Settlement With Investors
TELECOMMUNICATIONS COMPANIES: Reach $300M Settlement In Consumer Suit
TELESENKSCL: Goes Into Receivership, Workers File Suit For Unpaid Wages
TRI-STATE CREMATORY: Operator Fears For Safety As Suit Hearings Proceed
UNITED STATES: Air Force Seeks Dismissal of Discrimination Lawsuit
UTAH: Attorneys File Suit Over Inadequacy Of Public Defender's Office
WORLDCOM INC.: Reveals Hidden $3.3 Billion Debt Due To Accounting Fraud
New Securities Fraud Cases
360NETWORKS INC.: Schiffrin & Barroway Lodges Securities Suit in NY
AMERADA HESS: Charles Piven Commences Securities Suit in New Jersey
AMERICAN EXPRESS: Schiffrin & Barroway Lodges Securities Suit in NY
AMERICAN EXPRESS: Cauley Geller Commences Securities Suit in S.D. NY
AMERICAN EXPRESS: Milberg Weiss Commences Securities Suit in S.D. NY
AON CORPORATION: Milberg Weiss Commences Securities Suit in N.D. IL
ECLIPSYS CORPORATION: Charles Piven Commences Securities Suit in FL
ICN PHARMACEUTICALS: Abbey Gardy Commences Securities Suit in C.D. CA
ICN PHARMACEUTICALS: Charles Piven Commences Securities Suit in C.D. CA
JOHNSON & JOHNSON: Wolf Popper Commences Securities Suit in S.D. NY
MERRILL LYNCH: Cohen Milstein Initiates Securities Suit in S.D. NY
MSC INDUSTRIAL: Weiss & Yourman Commences Securities Suit in E.D. NY
NICOR INC.: Charles Piven Commences Securities Fraud Suit in N.D. IL
PERKINELMER INC.: Bernstein Liebhard Commences Securities Suit in MA
RIVERSTONE NETWORKS: Schiffrin & Barroway Lodges Securities Suit in CA
RIVERSTONE NETWORKS: Cauley Geller Commences Securities Suit in N.D. CA
RIVERSTONE NETWORKS: Milberg Weiss Commences Securities Suit in N.D. CA
SALOMON SMITH: Schiffrin & Barroway Commences Securities Suit in NY
SALOMON SMITH: Cauley Geller Commences Securities Fraud Suit in S.D. NY
SEEBEYOND TECHNOLOGY: Wechsler Harwood Files Securities Suit in C.D. CA
VIVENDI UNIVERSAL: Charles Piven Commences Securities Suit in S.D. NY
*********
AUSTRALIA: High Court Rules Government's Asylum Rejections Invalid
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Australia's High Court has thrown into question the federal
government's process for determining refugee claims by ruling invalid,
in the class action before it, thousands of decisions by the Refugee
Review Tribunal, the Sydney Morning Herald reports.
In two critical judgments, the bench ruled that asylum seekers had been
denied procedural fairness in cases before the tribunal. The decisions
have direct ramifications for 7600 refugee claimants who had
participated in the class action, which lawyers believe is the biggest
placed before the High Court. However, legal experts and refugee
groups claimed it could extend much further, raising doubts about the
Tribunal's handling of refugee cases back to its creation in 1993.
The High Court's decision means people whose claims were previously
rejected by the Tribunal can again pursue their claims for asylum.
However, the claims must have been filed before last November's
legislative changes.
Those involved in the class action are currently on bridging visas,
pending final outcome of their legal appeals. The limited visas deny
them the right to seek employment or to use government services like
Medicare.
The High Court's decisions are a major embarrassment for the
government. The defeat, which had not been anticipated, severely
weakens its political case to limit judicial reviews of tribunal
decisions. Additionally, the Immigration Minister, Philip Ruddock, has
sought to outlaw class actions - the vehicle whereby the asylum seekers
take to court the rejections of their bid for asylum. A spokeswoman
for Mr. Ruddock said the judgment and its wider ramifications are still
being examined.
One of the major grounds upon which the High Court relied in its
rejection of the Tribunal's rulings was that the Tribunal had failed to
look at all favorable evidence available to it and therefore the
claimants had been denied procedural fairness.
CALIFORNIA: Judge Orders Lawyers To Reach Pact Over Disabled Children
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The future of the Ravenswood school district was put on hold again, as
a federal judge gave lawyers 30 days to try to settle on an appropriate
punishment for the district's failure to serve children with
disabilities, the San Jose Mercury News reports.
If lawyers for special education students and the East Palo Alto
district reach an agreement, US District Judge Thelton Henderson will
no longer need to decide whether to order a state takeover of
Ravenswood. However, said the children's lawyers, they will resume
their push for a take over in a month, if they cannot reach a
settlement with significant benefits for the students.
Judge Henderson held Ravenswood in contempt last year for failing, in
the face of a court order, to improve its special education program.
He was to preside over a hearing in September to determine whether
Ravenswood is still in contempt, and if so, to determine an appropriate
punishment.
Instead, the lawyers will meet back in Judge Henderson's courtroom on
September 17 to report the details of whatever agreement they may
reach. If the lawyers do not reach an agreement, preparation for the
contempt hearing will resume. Ravenswood lawyer Charles Weatherly said
he is hopeful that the sides can resolve the issue. "The goal of
everyone is putting resources to children instead of litigation."
One year ago, lawyers for the special education student and the state
asked Judge Henderson to order a state takeover of Ravenswood because
they said the leadership of the school district, longtime
Superintendent Charlie Mae Knight, is incompetent and unwilling to
change. In the event of a state takeover, a state administrator could
take the place of the locally elected school board and superintendent.
Any agreement reached, would resolve only the contempt proceedings
against Ravenswood, that the school district failed to set in motion an
acceptable special education program for the disabled children. An
agreement will not end the class action filed by the lawyers on behalf
of the children, nor would it end the federal court's oversight of the
special education program.
CALIFORNIA: National Guard Plane Starts Fire, Lawsuit Seems Likely
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Residents of a wooded area near the town of Julian in California are
meeting with lawyers at their local Town Hall to discuss a possible
class action against the National Guard, which, they say, was
responsible for ignition of the fire which is devastating their
neighborhood, The San Diego Union-Tribune reports.
The fire started in a wooded area called the Pines, near Julian. The
blaze has burned about 54,000 acres and has destroyed about 30 homes.
The fire began when a National Guard helicopter, scouting for marijuana
plants clipped a power line near an area called Banner Grade.
Scores of residents also packed the Julian Town Hall on the evening
prior to the meeting with the lawyers. At this meeting the residents
expressed their frustration over the way the Pines fire started, with
one man demanding to know what rules National Guard pilots fly under.
The National Guard spokeswoman at the meeting, Major Kim Oliver, said
she didn't know, but would get the information and get back to him.
People said there had to be more rules about clearing the brush around
homes in the area and getting government help to dispose of it, because
disposal is costly and difficult but it was necessary because the
collected brush dried and became a fire hazard.
CANADA: Victoria's Supreme Court Chief Executive Sues Over Poison Fish
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The Chief Executive of Victoria's Supreme Court and his family are
members of a class action against a Queensland charter boat skipper who
allegedly supplied them with poisonous fish, The Age reports.
Bruce McLean, 52, his wife, Glenda, 51 and daughter Miecha, 16, are
part of a 10-person action brought against Anthony David Nicholson of
Hervey Bay. Mr. Nicholson is described in the claim as the skipper of
the MV Princess II. The plaintiffs claim they had ciguatera poisoning
after Mr. Nicholson supplied them with Spanish mackerel in January last
year.
Mr. McLean said that he and his family are still suffering health
problems more than 18 months after eating the fish while on holiday
visiting relatives. The relatives are part of the Supreme Court
action, along with other Queensland residents and a Canadian woman.
Mr. McLean says he is part of the action as a private citizen.
Mr. McLean said one aspect of bringing the claim was to illustrate the
dangers of eating the fish. "You have to exercise caution. You can't
cook this poison out, you can't freeze it, you can't treat it." He
said he and others spent days in the hospital and were told the toxins
could remain in their bodies for up to 15 years.
CATHOLIC CHURCH: Abuse Records Ordered Open, Partial Sealing Overturned
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By a 2 to 1 vote, a panel of the Kentucky Court of Appeals ruled that
all court records should be made public in a sexual abuse lawsuit
against the Catholic dioceses of Lexington and Covington, The
Lexington Herald Leader reports.
Chief Judge Thomas Emberton of Edmonton and Judge Sara Walter Combs of
Stanton voted to open all the records to the public. Judge Emberton,
in the majority opinion, wrote that the court could not find "a
compelling public interest that would justify" sealing any of the
records.
Judge Combs, in a concurring opinion, said the "disturbing and painful"
allegations of sexual misconduct by priests were a compelling reason
for opening the records. "The serious allegations involving breach of
sacred, fiduciary duties both shock the conscience and sicken the
spirit of society at large," she said. "The cloak of secrecy alleged
to have shielded this reprehensible conduct from disclosure cannot be
maintained."
Judge William Knopf of Louisville filed a dissenting opinion that
echoed his comments when lawyers were making their oral arguments
before the court. Judge Knopf agreed with opening all records that
pertain to allegations by the plaintiffs, who allege they were sexually
abused by priests when they were minors.
However, Judge Knopf was adamantly opposed to making public any
allegations deemed irrelevant to the plaintiffs' claims. Those
allegations, which the diocese wants kept secret, should be removed
from the trial court's files because if made public they are "sure to
cause harm to innocent people" not involved in the case.
The ruling to open all court records in the sexual abuse lawsuit was in
response to The Lexington Herald-Leader's attempt to open all records.
The newspaper initially intervened when the trial judge, Judge Mary
Noble of the Fayette Circuit, ordered that all records be sealed.
Judge Noble had stricken some material from the trial because she
considered it irrelevant to the plaintiffs' allegations.
The Lexington Diocese then argued that the stricken material should be
removed from the court records and not be made public. The Herald-
Leader's attorney, Robert L. Houlihan Jr., argued that all the court
records should be open to the public.
As Judge Noble was about to rule all court records should be open, John
Famularo, Lexington Diocese attorney, obtained an emergency order for a
hearing before the appeals court panel. Some details have emerged
about the contents of the documents that the Diocese wants sealed.
Judge Emberton wrote that the records at issue "provide details of
alleged sexual misconduct by priests . and allege that the Lexington
diocese has failed to take proper or timely corrective action."
Amanda Bennett, editor and senior vice president of the Herald-Leader,
Said, "We are pleased not just because the appeals court has ruled to
unseal the entire document, but also because in doing so, two of the
judges strongly reaffirmed the crucial role the news media play in
giving the public a free and open view into the court's workings."
CITIZENS INC.: Court Certifies Suit Over Illegal Insurance Marketing
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Travis County, Texas, District Court Judge Suzanne Covington approved
class action status for a lawsuit brought against Austin insurer,
Citizens Inc., the Austin American-Statesman reports. The Company also
disclosed the ruling in a recent filing with the Securities and
Exchange Commission.
The plaintiffs allege that the Company marketed insurance policies to
non-US residents that actually were a way for them to purchase stock in
the Company. Many of the lead plaintiffs in the class action are from
South America.
According to filings by the plaintiffs, more than 25,000 people in
approximately 50 countries purchased plans from the Company. The
plaintiffs argue that the policies are improper because they violate
the Texas Securities Act.
The Company plans to file an appeal in response and hopes to have the
lawsuit dismissed.
CONNECTICUT: Female Guards Sue Corrections Dept For Sexual Harassment
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Eight female prison guards have filed a class-action lawsuit against
officials of the state Department of Correction, claiming the officials
did not do enough to stop sexual harassment by male co-workers, the
Associate Press Newswires.
The 111-page lawsuit alleges that Commissioner John Armstrong and other
high-ranking officials ignored the harassment reports, cultivating a
"code of silence" about sexual harassment within the department.
The department is "brimming with men who regularly and routinely
sexually harass, intimidate and retaliate against the department's
female employees," said Antonio Ponvert, one of two attorneys
representing the women. The women are accusing male guards of watching
pornographic movies while on duty. They say one female guard was asked
to work as a prostitute for a male guard's prostitution ring.
The suit also claims that one female guard found a used condom on her
car, and another was physically threatened when she refused a male co-
worker's sexual advances. The lawsuit argues female guards were denied
bathrooom breaks, were touched sexually, and were subjected to explicit
language on the job. In nearly every case, the women say, the
department has allowed the harassment to continue.
The women are asking for unspecified monetary damages and an injunction
to stop the harassment. They say women, who have filed complaints in
the past, faced retaliation from male officers. They are asking that
serious offenders be fired. The female guards also want the department
to keep files on sexual harassment complaints, and offer a more
thorough sexual harassment education program to employees.
"I think they have a very strong case," said Senator Edith Prague, D-
Columbia, co-chair of the Legislature's Committee on Labor and Public
Employees. "These men are very aware of what they are doing. And they
are doing it deliberately."
The department of correction agreed to allow an independent
investigator to examine its affirmative action division, which
investigates sexual harassment allegations, as a first step in
addressing sexual harassment since the women first accused the agency
of ignoring complaints in June.
A revised sexual harassment policy went into effect at the agency in
June. However, the problem is not with the written policy, said Leslie
Brett, executive director of the Permanent Commission on the Status of
Women. "Their sexual harassment policy is very similar to one you
would find at any state agency," Ms. Brett said. "To me, the question
really is the type of investigations they are doing and the
disciplinary steps they take are appropriate."
FLORIDA POWER: Prevails as Jury Says Firm Did Not Discriminate V. Age
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An Ocala, Florida jury ruled recently that Florida Power did not
discriminate on the basis of age against 12 former employees who lost
their jobs, the St. Petersburg Times reports.
The verdict in US District Court handed Florida Power its second legal
victory against age-bias charges this year. In April, the United
States Supreme Court rejected efforts by 117 former Florida Power
employees to bring a class action against the Company for what they
claimed was its violation of the 1967 Age Discrimination in Employment
Act.
Stripped of the option of pursuing such a broad-based lawsuit, smaller
groups of workers filed suits limited to their own cases. Friday's
verdict came in the first of 11 such suits. It was filed by workers in
the Company's information technology operations.
Edward Scott, an Ocala attorney representing the former Florida Power
employees, said he and co-counsel Scott Charlton plan to appeal the
jury's verdict. Edward Scott and Scott Charlton also represent the
remaining former Florida Power employees who were part of the original
class-action lawsuit. "Our intent is, we have 10 more to go," said
Edward Scott.
The layoffs in dispute were part of a major restructuring at Florida
Power in the mid 1990s. Of 564 employees let go between 1993 and 1995,
about three-quarters were over age 40, according to the plaintiffs'
attorneys.
Mr. Scott, the former employees' attorney, said he expects US District
Judge William Terrell Hodges to schedule a pretrial conference within
the next 30 days for the second trial, which he expects to start in
about 90 days.
GERMANY: Plans To Allow Small Shareholders To File Suit Against Firms
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Germany plans to open the way for small shareholders to group together
to launch legal action against companies and their management,
according to a report by Reuters English News Service, which quoted the
country's justice minister, Herta Daeubler-Gmelin, as saying, "Affected
shareholders will in the future be able to group together."
A justice ministry spokesman could not immediately say whether the
planned move was inspired by US class actions, under which the US
courts allow collective action. German law currently limits legal
actions to minority shareholders holding at least five percent of a
company's capital.
Under the newly contemplated plan, according to the justice minister,
that threshold would be reduced to one percent for small shareholders
acting together, who hold at least one percent of a company or shares
worth 100,000 euros of market capitalization.
No change was likely to be proposed, however, before Germany's
September 22 general election, the justice ministry spokesman said.
HAWAII MEDICAL: Doctors Sue, Alleging Unfair, Fraudulent Practices
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The 900-member Hawaii Medical Association and two of its member
physicians are suing the Hawaii Medical Service Association, the
state's largest medical insurer, accusing the nonprofit insurer of
harming doctors by using unfair and anticompetitive reimbursement
practices, Associated Press Newswires reports.
The lawsuits were filed in First Circuit Court, in Honolulu, the
plaintiffs' attorney Rick Eichor said. Attorneys want the lawsuit,
filed on behalf of the two doctors, certified as a class action, he
added.
The lawsuit alleges the Company routinely reduces and denies physician
claims, sometimes using computer-profiling programs, to achieve
internal financial goals regardless of patient needs.
"They are using computer programs to deny legitimate claims," said Mr.
Eichor, who is serving as local counsel with former attorney general
Warren Price. "It is complicated, but in a nutshell that is part of
what they (HMSA) are doing."
The association's complaint, which asks the court to halt the
reimbursement practices, says the practices have cost local physicians
millions of dollars since August 1996, and threaten continuity of
patient care.
The association's complaint also says that because HMSA is the largest
health plan in Hawaii, insuring about two-thirds of the population,
physicians have been forced to accept HMSA practices at the risk of
losing patients.
Clifford Cisco, a senior vice president with HMSA, noted that the
insurer is a mutual benefit society owned by premium payers. HMSA, he
said, has lost money in each of the past three years while it paid more
to reimburse physicians. The Company reported operating revenue of
$1.22 billion last year, offset by benefit payments and expenses of
nearly $1.24 billion.
HUDSON'S BAY: Labels Without Merit Simpsons Employees' Allegations
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Hudson's Bay Co. is reviewing the statement of claim filed by a group
of former Simpsons employees, relating to their pension plan. The
department store retailer, which acquired Simpsons in 1979, says that
the claims filed in the class action are "without merit," the Globe and
Mail reports.
Members of the former Simpsons supplementary pension plan filed a class
action against the Company and the Royal Trust and Investors Group
Trust, alleging breach of trust and fiduciary duties in relation
to the administration of the former Simpsons plan. The Simpsons plan
members are seeking, in part, the return of surplus capital estimated
at more than $75 million.
The Company stated that it cannot respond directly to the allegations
"being made in the media," as the case is now before the court.
MARSHALL FIELDS: Five Women File Lawsuit Over "Fake" Vera Wang Gowns
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Five women are suing retailer Marshal Field's and its parent, Target
Corp., in Cook County Circuit Court, alleging that the periwinkle-blue
Vera Wang bridesmaid gowns they purchased from Field's bridal salon
were fakes, according to the Chicago Tribune.
The alleged fraud came to light when a disgruntled employee of EFTB
Inc., the third-party contractor that operates Field's bridal salon,
went to Renee Ferguson, a Chicago area talk show host, with his story
that EFTB purchased fabric and zippers from Vera Wang's New York
company and made the dresses itself.
"They paid a premium for a Vera Wang dress and didn't get it," Ray
Groble, who is representing the bridesmaids, said. "They were, quite
simply, defrauded." Mr. Groble says there are other cases out there
and he will be asking the court to certify the lawsuit as a class
action. In the meantime, his clients are seeking $500,000 in punitive
damages.
The Company responded by firing the contractor who ran the bridal
salon, EFTB. The Company said in a statement that it is trying to
resolve the problem, even though it was EFTB that "was responsible for
serving these guests." The Company also vows to "vigorously defend
ourselves" from what it calls an "unnecessary lawsuit."
Mr. Groble, however, contends that "it was the bridal salon at Marshal
Field's that was selling the dresses. Not EFTB. Marshall Field's is
responsible for what the vendors do."
This may be a question of fact for the jury to decide or a question
of law for the court. The outsourcing of departments to be run by
third parties, or contractors, inside a large department store, is the
result of the fact that department stores have been losing money for
most of the past decade. The hand-over to a contractor is transparent
to the customers and it is meant to be. However, the benefits to the
bottom line show up in sharp relief, fewer employees on the department
store's payroll and lower benefits costs.
Does liability for wrongdoing conducted within the outsourced
department run to the contractor or reside with the department store?
Marshall Field's, Chicago's hometown department store, has been a
leader in this area, outsourcing a variety of departments, from the
bridal salon to the fine jewelry department to the fur salon.
MASSACHUSETTS: Bristol County Jail Inmates Sue Over Cell-And-Board Fees
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Nine Bristol County Jail inmates filed a class action against Sheriff
Thomas M. Hodgson, claiming he has no right to charge them $5 a day for
their incarceration, plus more for haircuts and doctor visits, the
Boston Herald reports.
The suit, filed in Bristol Superior Court, claims Mr. Hodgson had no
authority under state laws to take money from the inmates' accounts and
constitutes unlawful seizure. Sheriff Hodgson said he is determined to
teach prisoners there is no free lunch, even in jail. He added that
his lawyers tell him he has the power.
"If they have the money to buy candy and other items in our canteen
store while people's taxes are going up to maintain government
services, it just seems to me they should be picking up the portion of
the government tab they can," said Sheriff Hodgson. He began the $5-a-
day charge in July, spurring some inmates to toss feces and go on
hunger strikes.
Attorneys for the prisoners claim inmates do not seek medical care
because they cannot afford a $5 co-pay fee. The lawsuit cites one
inmate who allegedly gets no treatment for hepatitis C or for an
abscessed tooth.
"That is ludicrous," said the sheriff. "Anybody who is indigent gets
treatment."
MCKESSON WATER: Black Drivers Settle Suit Over Racial Discrimination
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Black truck drivers who deliver Sparkletts water will share the $1.2
million settlement of a class action that alleged that McKesson Water
Products Co.'s former owner discriminated against them, Associated
Press Newswires reports.
The lawsuit accused the bottled water company of assigning African-
American employees to so-called "ghetto routes" in low-income Los
Angeles neighborhoods, which are less profitable than those in more
affluent communities. The suit further alleges that black drivers made
less than their white counterparts because pay and promotion were tied
to the profitability of routes.
US District Judge Florence-Marie Cooper approved the settlement in
March and ratified a formula for distribution of the money. Antonio
Lawson, an attorney who represented the workers, said that about 85
current and former McKesson drivers will soon receive checks ranging
from about $1,000 to $27,000 each.
The Company was acquired in 2000 by the French conglomerate, Groupe
Danone, which assumed responsibility for agreeing to the settlement.
The Company also has agreed to implement anti-discrimination policies,
including a formal job-bidding system and new criteria to determine
route assignments, compensation, promotions and performance
evaluations.
The federal Equal Employment Opportunity Commission investigated the
drivers' claims and joined in their suit against the Company. The
agency will work with Danone over the next five years to see that the
settlement is fully implemented.
NCS HEALTHCARE: Faces Suit Over Proposed Merger With Genesis Health
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Dolphin Limited Partnership I, LP, a Stamford, Connecticut based
private investment firm filed a class action in the Delaware Chancery
Court to enjoin the proposed merger between NCS Healthcare, Inc.
(NASDAQ Bulletin Board symbol: NCSS) and Genesis Health Ventures, Inc.
(NASDAQ symbol: "GHVI"). Dolphin holds 500,000 Class A common shares
(2.7% of this Class). Under the proposed merger, each share of NCSS
would receive .1 of a share of GHVI.
The suit alleges numerous breaches of fiduciary duty and failure of the
NCSS directors to act in good faith with regard to the proposed merger
agreement between NCSS and GHVI, and NCSS's refusal to explore Omnicare
Inc.'s (OCR) superior offer. The GHVI merger is currently valued at
approximately only $1.60 per NCSS share, while OCR is offering $3.50
per share in a fully-financed all cash tender offer and has stated a
willingness to negotiate all aspects of its offer.
The four member NCSS Board of Directors (two of whom are senior NCSS
officers and one of whom is conflicted as a result of a consulting
agreement) by virtue of their ownership of the super vote Class B
common shares, has in excess of 65% of the vote, and thereby able to
effectuate the proposed transaction without any say from the public
shareholders who own 77% of the Company (through the Class A common
shares, each of which has one vote per share). Under the proposed
GHVI/NCSS merger, NCSS Class A common shareholders would own an
insignificant 4.2% of the combined company.
A spokesperson for Dolphin commented, "in light of OCR's $3.50 per
share fully-financed all cash tender offer and a stated willingness to
negotiate all aspects of its offer, we fail to understand how the
proposed GHVI stock merger delivers the greatest value to the NCSS
shareholders now or in the reasonably foreseeable future. GHVI recently
emerged from bankruptcy, currently trades at about $16 per share, does
not have a permanent CEO, has an equity market capitalization of less
than half that of OCR, and a combined NCSS/GHVI would have net debt and
preferred stock of well over $800 million. GHVI would have to currently
trade at $35.00 per share, more than double its current share price, in
order for the NCSS shareholders to receive comparable value to the OCR
offer. Under these circumstances we are dismayed by NCSS's continued
refusal to provide any rationale for their grossly inferior proposed
merger with GHVI."
For more information, contact Stephen Lowey or Lowey Dannenberg
Bemporad & Selinger, PC by Mail: One North Lexington Avenue, White
Plains, NY 10601-1714 by Phone: 877-777-3581 or by E-mail:
slowey@ldbs.com
PEOPLES ENERGY: Settling As Gas Outage Leaves 4,500 Without Heat in IL
----------------------------------------------------------------------
More than five months after the administration of Chicago Mayor Chuck
Daley called for expense reimbursements for Far Southwest Side
residents of Chicago left shivering in February after a city crew
ruptured a natural gas line, those who had to pay for hotels and
restaurant meals still have not seen a cent of compensation, the
Chicago Tribune reports.
However, with the recent withdrawal of a class-action lawsuit against
the city, the prospect of checks hitting the mail may be getting
closer, officials are saying.
A city sewer crew broke the line in a construction accident on February
26, leaving about 4,500 customer without gas, some for more than three
days. On March 13, a top mayoral aide said the city would be willing
to cover some of the out-of-pocket expenses of people inconvenienced by
the outage, but asserted that Peoples Energy also must come up with
money, blaming the company for the size and duration of the service
interruption.
"At that point, we said, `Sure, we'll sit down and talk with you about
that,' but we have not heard from them (the city)," Peoples Energy
spokesman Rod Sierra said recently.
Jennifer Hoyle, spokeswoman for the city's Law Department, said that
termination of the lawsuit and the legal cloud it put over the matter
could bring progress on payment. "Now we would like to sit down with
Peoples Energy to try to address the claims that have been filed," Ms.
Hoyle said.
Meanwhile, the city and the company remain at odds over City Hall's
demand that Peoples turn over the detailed layout of its underground
distribution system, including the location of shut-off valves. Mr.
Sierra said the city has failed to provide assurances in writing that
it would not permit public release of the information. However, this
obstacle, too, seems ready to yield to agreement by the two parties.
PEROT SYSTEMS: Faces Seven Lawsuits Over Aid Given To Energy Firms
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Perot Systems Corporation faces seven class actions filed since June,
over its actions in California, where officials charge the technology-
services company helped energy firms gouge electricity customers,
according to a report by the Associated Press Newswires. Six of the
lawsuits also name chairman Ross Perot and chief executive Ross Perot,
Jr. as defendants.
The suits charge the Company with violating fraud and securities laws,
and claim that the Company's regulatory filings did not accurately
discuss the company's California activities. The Company, based in the
Dallas suburb of Plano, said the lawsuits are without merit and would
not affect its financial results.
The Company said it spent $3.5 million through June 30 on the
investigation into its role in the California energy crisis and that it
expects to incur more costs, which it could not estimate. These
lawsuits were disclosed in a recent filing by the company with the
Securities and Exchange Commission.
Two of the lawsuits were filed in federal district court in New York
and four were filed in federal court in Dallas. The case that named
only the Company was filed in San Diego.
The Company was hired to help run the computers of two power exchanges
in California, and state officials say the Company tried to sell its
inside knowledge of the state's electric market to energy companies.
The Company says the information was publicly available.
SUNBEAM CORPORATION: Reaches $141 Million Settlement With Investors
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A federal judge recently signed off on a $141 million settlement of a
class action, that investors who lost money on Sunbeam Corporation
stock, brought against the now-bankrupt appliance maker, Associated
Press Newswires reports.
The lawsuit accused the Company and its officers of inflating stock
prices and misleading investors about the company's sales and earnings
in the 18-month period leading up to the ouster of chairman and chief
executive Al Dunlap in June 1998.
US District Judge Donald Middlebrooks signed the settlement agreement,
which will provide about $106 million for investors. Attorneys
estimated that investors will be compensated for 12 percent to 15
percent of their losses. Investors say they lost $800 million on their
stock due to the Company's fraudulent business practices.
Tens of thousands of shareholders have filed claims for their share of
the settlement, and the last claims must be postmarked by September 6.
Judge Middlebrooks also has approved giving attorneys a 25 percent
share of the settlement, or about $35 million, in fees.
The bulk of the settlement is coming from the Company's accountant,
Arthur Andersen. The accounting firm, which was convicted in June on
the criminal charge of obstruction of justice for the shredding of
Enron audit documents, agreed to pay $110 million as part of a Company
settlement last year. Attorneys say they already have Arthur
Andersen's money in hand and will begin distributing it in about 30
days.
The Company was forced to restate financial results for 18 months
before Al Dunlap, former chairman and chief executive, was fired in
June 1998. Mr. Dunlap will pay $15 million of the settlement.
The settlement also includes money from insurers with policies covering
company officials, including $13.5 million from Warren, New Jersey-
based Chubb's Executive Risk Insurance Co. and Federal Insurance Co.,
and $2 million from Cincinnati-based Great American Insurance Group.
Former executive vice president Russell Kersh agreed to pay $250,000.
None of the settlements contained admissions of wrongdoing.
TELECOMMUNICATIONS COMPANIES: Reach $300M Settlement In Consumer Suit
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Lucent Technologies Inc., one of AT&T's spin-off companies, along with
AT&T, has reached a preliminary settlement worth $300 million in a
class action over consumer-leased telephones, Associated Press
Newswires reports.
The suit alleges that Murray Hill, New Jersey-based Lucent charged
unconscionably high lease payments for old telephones that had been
installed in homes before 1984. The case was scheduled for trial in
Circuit Court, in Madison County, Illinois, this month. A judge will
hold a hearing in November on whether to approve the agreement.
Under terms of the settlement, customers who leased old telephones
could receive up to $80 each. The settlement also calls for the
companies to donate an additional $50 million in long-distance calling
cards to charities. Lucent will share the cost of the settlement with
AT&T, Avaya and NCR, which formerly were affiliated.
Home telephone leasing began after the break-up of the Bell monopoly in
1984. Before the break-up, a telephone was provided as part of a
customer's basic monthly service charge. Lucent took over the phone
leases and charged more than $4 per month, according to the lawsuit.
Lucent said it agreed to settle the case to avoid further expensive
litigation. The Company said the settlement is not an admission of
liability.
TELESENKSCL: Goes Into Receivership, Workers File Suit For Unpaid Wages
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TelesenKSCL (KSCL) faces a potential class action to be filed by its
220 workers after the Edinburgh telecommunications company, announced
to its staff that the firm was being put into receivership, only days
after directors had assured the workers that there was enough money in
the bank to pay their wages, according to the Evening News (Scotland).
Three days after the assurances, a staff of 220 workers, including
expectant mothers and those on sick leave, were told to leave, that
there was no money to pay their salaries for the previous month or for
any kind of redundancy payment or pay in lieu of notice.
The suit will be filed against the receivers, Deloitte & Touche, and
the firm's new owner, Convergys, to try and get the wages they say are
owed them. "At the moment," said Mike Cicero, one of the fired
workers, "there are 202 of us involved in this action and the rest are
thinking about it . We are facing financial hardship and rather than
sit back and do nothing we forged this group."
"The advice we received from MPs and MSPs was that we had to stick
together," continued Mr. Cicero. "We would like to thank all the
politicians who have helped us as we did feel we were on our own, but
they made us feel the matter was worth pursuing."
Margaret Smith, MSP for the Edinburgh West constituency where the
company was based, backed the class action and has been involved in
meetings with Deloitte & Touche. "I had a meeting with the receivers
in which questions were raised over the manner in which people were
dealt with, particularly the women who were pregnant or on maternity
leave who were dismissed. So far, I have not been reassured by any
answers," Ms. Smith said. She added that she was told by the receivers
that it was for individuals to take up their complaints with the
employment tribunals.
Ms. Smith also said, "However, the average individual taking the battle
to the receivers would be really up against it and so a class action,
pooling resources with other people, is the only realistic way in which
my constituents can take this forward."
Specialist employment lawyers, Roydens Employment Solicitors, based in
Manchester, have been brought in by the ex-KSCL staff. David Royden of
Roydens said, "I was surprised and dismayed, given the identities of
those we intend to litigate against in this action, that they were not
aware of, or worse ignored, the potential consequences of their actions
in dismissing the staff in circumstances which, in my opinion, are
blatantly unfair and unlawful."
As the news further emerged, The Herald (Glasgow, Scotland) revealed
that Deloitte & Touche, also will be facing a sexual discrimination
allegation along with the class action to be filed later this month at
the Employment Tribunals office in Edinburgh. "We absolutely will be
including the sexual discrimination aspect into the lawsuit," said
David Royden, who is preparing the case. "We are also hoping to get
the backing of the Equal Opportunities Commission on this."
The former employees claim the seven expectant mothers were told by
Deloitte & Touche that they were not being dismissed because they were
pregnant, but because they would be going on maternity leave and would
not be around to staff the operation.
Mr. Royden also said that he is bringing the case against both parties.
Convergys is the US-based competitor, which is buying KSCL out of
receivership. "Our case is against both parties because liability may
transfer from Deloitte & Touche to Convergys," Mr. Royden said.
TelesensKSCL produced billing systems software for mobile phone
operations. It ran into financial trouble after a liquidity crisis at
its German parent, TelesensKSCL AG.
TRI-STATE CREMATORY: Operator Fears For Safety As Suit Hearings Proceed
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There is a certain amount of bustle around the federal court in Rome,
Georgia, as attorneys congregate to carry on some of the business of
the lawsuits relating to the Tri-State Crematory, the Associated Press
Newswires reports. After the August hearings have been completed, the
next meeting for the attorneys in Rome will be December 16-17 to
discuss making the cases a class action.
More than 340 uncremated human remains were recovered on the grounds of
the Marsh family's crematory at Noble, near the Tennessee border,
giving rise to criminal charges and numerous lawsuits from relatives of
the deceased. Numerous pre-trial hearings are being conducted, and
some special safety measures are being taken around the person of
crematory operator Roy Marsh by his attorney Ken Poston, who had
informed Governor Roy Barnes that he feared for Mr. Marsh's safety.
Mr. Poston fears Mr. Marsh's physical safety could be in jeopardy from
public outrage over discovery of body remains of loved ones, who were
never cremated, but instead dumped on crematory property. While a
spokeswoman for Governor Barnes said special protection would not be
offered, Superior Court Judge James Bodiford did offer Mr. Marsh the
option of staying in protective custody.
Mr. Marsh has been charged with 398 felony counts, including theft by
deception and abuse of a body for allegedly accepting money and never
performing the cremation.
In addition to the criminal charges, Mr. Marsh and 17 funeral home
companies that dealt with the crematory face numerous lawsuits from
relatives of the deceased. US District Judge Harold L. Murphy of Rome
is presiding over the pretrial portion of the cases in Rome. When
those matters, including determination of class action status at the
scheduled December 16-17 hearings, and other disclosures and filings
are complete, the cases will return to their home districts.
Judge Murphy's courtroom, at the recent hearing, was crowded with more
than 50 attorneys, some from as far away as California, representing
plaintiffs and defendants. Judge Murphy appointed Rome attorneys,
Robert Brinson and Andy Davis as head counsel for the funeral home
defendants, who will remain separate from Mr. Marsh, the crematorium
operator. Elizabeth Cabraser of San Francisco was appointed as lead
plaintiff counsel for the families, with Robert H. Smally of Dalton
chosen as liaison.
Mr. Marsh, who has been a rare participant in the previous court
hearings, was accompanied by two armed deputies from the Walker County
Sheriff's Office.
UNITED STATES: Air Force Seeks Dismissal of Discrimination Lawsuit
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The United States Air Force filed a motion to dismiss a discrimination
lawsuit brought earlier this year by five white male civilian workers
at the Warner Robins Air Logistics Center, the Macon Telegraph reports.
All five men allege the Air Force's appraisal system, used to determine
pay raises, promotion and retention, discriminates based on race and
sex. Four of the men, all older than 40, also allege age
discrimination. Their lawsuit asks the court to certify the suit as a
class action. The suit does not name dollar amounts, but asks for back
pay, lost benefits, lost money for pensions and bonuses, attorney's
fees and other compensatory and punitive damages.
The motion for dismissal, filed in US District Court in Macon, Georgia,
does not address the men's allegations. Instead, it merely makes other
legal arguments why the lawsuit should be dismissed. The motion says
the plaintiffs, Willie Barber, Samuel Rawlins, Danny Kilgore, Dwight
Stone and Bill Bobbitt cannot sue for discrimination because federal
law requires such complaints by federal employees to be reviewed by the
Equal Employment Opportunity Commission.
The motion also says the results of the workers' performance appraisals
are not an "adverse employment action" as required by federal law in
such a discrimination case. Court documents also show, the Air Force
claims, that the workers have provided no evidence of age
discrimination.
Atlanta attorney Lee Parks, who represents the workers, has said that,
although the five men are assigned to the software division of Robins'
Avionics Management Directorate, he believes the appraisal
discrimination practices could be more widespread.
Allegations of discrimination surfaced at the base last year when
someone found a supervisor's e-mails on a shared computer drive. At
least one person found, downloaded, printed and distributed the e-
mails, which are now used as evidence in the lawsuit. Some of the e-
mails appear to outline that performance appraisals were adjusted to
favor a minority male worker in the software division and to downgrade
some white males.
Robins officials said in a statement that an informal inquiry into the
allegations "concluded there was no wrongdoing with regard to either
law or policy."
UTAH: Attorneys File Suit Over Inadequacy Of Public Defender's Office
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Attorneys for two indigent defendants facing murder charges in
unrelated slayings, have filed a proposed class action in Utah federal
court, claiming Weber County failed to adequately fund the public
defender's office, Associated Press Newswires reports.
Richard Quentin Gunn, 55, of Ogden is accused of killing his former
roommate, and John Lindsay Austin, 36, is accused of fatally beating
and shaking his five-month-old son.
In the proposed class action, the two men allege that the lack of
funding of the Public Defenders Association of Weber County has
deprived them of their constitutional right to effective counsel. A
similar lawsuit was dismissed last month on a technicality. County
Commission attorney said the suit is without merit.
"The (public defender's) caseload is substantially the same as the
prosecutors, so how can this argument credibly be made?" Mr. Wilson
said. "Although the questions arise, is the funding the same? Are the
number of prosecutors the same?"
The defenders' caseloads exceed by far the numerical limits set by the
National Advisory Commission, which sets national criminal justice
standards, according to the lawsuit. Mr. Gunn and Mr. Austin are
harmed because "the workload demands of capital cases are unique," the
suit says. Investigating, preparing for and going to trial, plus
lengthy sentencing phase to determine whether the death penalty is
imposed, requires an average of almost 1,900 hours.
The lawsuit, filed by attorneys Michael Boyle and Daniel Drage, claims
excessive caseloads and inadequate resources prevent defense attorneys
from conducting necessary legal research, factual investigations and
witness preparation.
The plaintiffs and any future plaintiffs seek $500 for each felony
client and $250 for each misdemeanor client that the public defenders'
office has represented in the past six years.
WORLDCOM INC.: Reveals Hidden $3.3 Billion Debt Due To Accounting Fraud
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WorldCom Inc.'s latest revelation that it bogus accounting topped $7.1
billion in hidden debt could be a precursor to more changes at the
highest levels of the bankrupt company, analysts and observers say,
according to a report by the Associated Press Newswires. The Company
recently revealed that it had uncovered $3.3 billion more in bogus
accounting, adding to the $3.85 billion it had disclosed in June.
The Company, which filed for Chapter 11 bankruptcy protection July 21,
also has seen its former chief financial officer and controller charged
with hiding billions in expenses and lying to investors and regulators.
Changes already made at the company include the addition of a new CFO,
a restructuring officer and two new directors.
Still, bankruptcy attorney Chester Salomon said he would not be
surprised if someone linked to the case, perhaps a creditor or
bondholder, asks the bankruptcy court to appoint an independent trustee
to assume management of the company.
New Securities Fraud Cases
360NETWORKS INC.: Schiffrin & Barroway Lodges Securities Suit in NY
-------------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in the US
District Court for the Southern District of New York, alleging that
360Networks Inc. (Pink Sheets:TSIXQ) misled shareholders about its
business and financial condition.
Plaintiff seeks damages for violations of Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 (and/or the Securities Act of 1933)
on behalf of all investors who bought Company securities between
November 8, 2000 through June 28, 2001.
The complaint alleges that the Canada-based Company reported strong
year-over-year revenue growth. Unbeknownst to investors, however, as
alleged in the complaint, the Company was experiencing diminishing
revenue growth.
The complaint alleges that in order to create the impression that the
company was continuing to experience growth, the Company engaged in a
series of reciprocal transactions with certain competitors for the
purchase and sale of dark fiber optic cable -- the so-called dark fiber
swap. The complaint alleges that as a result of these transactions,
the Company artificially inflated its operating results and materially
misrepresented its financial results at all relevant times.
For more details, contact Marc A. Topaz or Stuart L. Berman by Mail:
888-299-7706 (toll free) or 610-822-2221 or by E-mail:
info@sbclasslaw.com
AMERADA HESS: Charles Piven Commences Securities Suit in New Jersey
-------------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired Amerada Hess Corp.
(NYSE:AHC) securities between February 9, 2001 and July 11, 2001,
inclusive, in the United States District Court for the District of New
Jersey, against the Company and certain of its officers and directors.
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
AMERICAN EXPRESS: Schiffrin & Barroway Lodges Securities Suit in NY
-------------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in the
United States District Court for the Southern District of New York on
behalf of all purchasers of the common stock of American Express Co.
(NYSE:AXP) between July 26, 1999 and July 17, 2001, inclusive.
The complaint charges the Company and certain of its officers and
directors with issuing false and misleading statements concerning its
business and financial condition. Specifically, the complaint alleges
that, throughout the class period, defendants issued numerous
statements and filed quarterly and annual reports with the SEC which
described the Company's increasing earnings and financial performance.
As alleged in the complaint, these statements were materially false and
misleading because they failed to disclose and/or misrepresented the
following adverse facts, among others:
(1) that the Company had made disproportionately large investments
in certain speculative high-yield securities. Indeed, in 1997
and 1998, the Company increased its investments in high-yield
securities to 10-12% of its portfolio of investments, well
beyond the industry norm of 7%;
(2) that the Company's increased investments in certain
speculative high-yield securities exposed the Company's
investment portfolio to substantial risk in the event default
rates in the junk bond market increased;
(3) that the Company lacked the internal controls necessary to
monitor its portfolio of high-yield securities such that it
was unable to take decisive action should its investments turn
against it; and
(4) that as a result of the foregoing, defendants' statements
concerning the Company's financial performance and future
prospects were materially false and misleading at all relevant
times.
On July 18, 2001, before the market opened for trading, the Company
issued a press release announcing that its earnings for the second
quarter of 2001, the period ending June 30, 2001, would most likely
decline 76% from its earnings in the same period of the prior year, in
part, because of an $826 million pre-tax charge to recognize,
"additional write-downs in the high-yield portfolio at American Express
Financial Advisors (AEFA) and losses associated with rebalancing the
portfolio towards lower-risk securities."
In a conference call following this announcement, the Company explained
that it had increased its investments in high-risk junk bonds in 1997
and 1998 to between 10% and 12% of its portfolio and would now be
scaling it back to 7%, which is the industry average.
For more details, contact Marc A. Topaz or Stuart L. Berman 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
AMERICAN EXPRESS: Cauley Geller Commences Securities Suit in S.D. NY
--------------------------------------------------------------------
Cauley Geller Bowman & Coates, LLP initiated a securities class action
in the United States District Court for the Southern District of New
York on behalf of purchasers of American Express Co. (NYSE: AXP) common
stock during the period between July 26, 1999 and July 17, 2001,
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 material misrepresentations to the
market between July 26, 1999 and July 17, 2001, thereby artificially
inflating the price of Company shares.
The complaint alleges that, throughout the Class Period, defendants
issued numerous statements and filed quarterly and annual reports with
the SEC which described the Company's increasing earnings and financial
performance. As alleged in the complaint, these statements were
materially false and misleading because they failed to disclose and/or
misrepresented the following adverse facts, among others:
(1) that the Company had made disproportionately large investments
in certain speculative high-yield securities. Indeed, in 1997
and 1998, the Company increased its investments in high-yield
securities to 10-12% of its portfolio of investments, well
beyond the industry norm of 7%;
(2) that the Company's increased investments in certain
speculative high-yield securities exposed the Company's
investment portfolio to substantial risk in the event default
rates in the junk bond market increased;
(3) that the Company lacked the internal controls necessary to
monitor its portfolio of high-yield securities such that it
was unable to take decisive action should its investments turn
against it; and
(4) that as a result of the foregoing, defendants' statements
concerning the Company's financial performance and future
prospects were materially false and misleading at all relevant
times.
On July 18, 2001, before the market opened for trading, the Company
issued a press release announcing that its earnings for the second
quarter of 2001, the period ending June 30, 2001, would most likely
decline 76% from its earnings in the same period of the prior year, in
part, because of an $826 million pre-tax charge to recognize
"additional write-downs in the high- yield portfolio at American
Express Financial Advisors (AEFA) and losses associated with
rebalancing the portfolio towards lower-risk securities."
In a conference call following this announcement, the Company explained
that the Company had increased its investments in high-risk junk bonds
in 1997 and 1998 to between 10% and 12% of its portfolio and would now
be scaling it back to 7%, which is the industry average.
For more details, contact Jackie Addison, Sue Null or Ellie Baker 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
AMERICAN EXPRESS: Milberg Weiss Commences Securities Suit in S.D. NY
--------------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class
action on behalf of purchasers of the shares of American Express Co.
(NYSE: AXP) between July 26, 1999 and July 17, 2001, inclusive, in the
United States District Court, Southern District of New York against the
Company and:
(1) Richard Karl Goeltz,
(2) Daniel T. Henry,
(3) Gary L. Crittenden,
(4) Harvey Golub and
(5) Kenneth I. Chenault
The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of material misrepresentations to the
market between July 26, 1999 and July 17, 2001, thereby artificially
inflating the price of Company shares.
The complaint alleges that, throughout the class period, defendants
issued numerous statements and filed quarterly and annual reports with
the SEC which described the Company's increasing earnings and financial
performance. As alleged in the complaint, these statements were
materially false and misleading because they failed to disclose and/or
misrepresented the following adverse facts, among others:
(i) that the Company had made disproportionately large investments
in certain speculative high-yield securities. Indeed, in 1997
and 1998, the Company increased its investments in high-yield
securities to 10-12% of its portfolio of investments, well
beyond the industry norm of 7%;
(ii) that the Company's increased investments in certain
speculative high-yield securities exposed the Company's
investment portfolio to substantial risk in the event default
rates in the junk bond market increased;
(iii) that the Company lacked the internal controls necessary to
monitor its portfolio of high-yield securities such that it
was unable to take decisive action should its investments turn
against it; and
(iv) that as a result of the foregoing, defendants' statements
concerning the Company's financial performance and future
prospects were materially false and misleading at all relevant
times.
On July 18, 2001, before the market opened for trading, the Company
issued a press release announcing that its earnings for the second
quarter of 2001, the period ending June 30, 2001, would most likely
decline 76% from its earnings in the same period of the prior year, in
part, because of an $826 million pre-tax charge to recognize
"additional write-downs in the high-yield portfolio at American Express
Financial Advisors (AEFA) and losses associated with rebalancing the
portfolio towards lower-risk securities."
In a conference call following this announcement, Mr. Chenault
explained that the Company had increased its investments in high-risk
junk bonds in 1997 and 1998 to between 10% and 12% of its portfolio and
would now be scaling it back to 7%, which is the industry average.
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: AmericanExpresscase@milbergNY.com or
visit the firm's Website: http://www.milberg.com
AON CORPORATION: Milberg Weiss Commences Securities Suit in N.D. IL
-------------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class
action on behalf of purchasers of the securities of Aon Corporation
(NYSE: AOC) between May 4, 1999 and August 6, 2002, inclusive. The
suit is pending in the United States District Court, Northern District
of Illinois, Eastern Division against the Company and:
(1) Patrick G. Ryan and
(2) Harvey N. Medvin
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 May 4, 1999 and August 6, 2002, thereby artificially
inflating the price of Company securities.
Throughout the class period, as alleged in the complaint, defendants
issued numerous statements and filed quarterly and annual reports with
the SEC which described the Company's earnings and financial
performance. The complaint alleges that these statements were
materially false and misleading because they failed to disclose and/or
misrepresented the following adverse facts, among others:
(i) that the Company had materially overstated its net income by
$27 million in 1999, by $24 million in 2000 and by $5 million
in the first quarter of 2002;
(ii) that the Company lacked adequate internal controls and was
therefore unable to ascertain the true financial condition of
the Company; and
(iii) that as a result, the value of the Company's net income and
financial results were materially overstated at all relevant
times.
On August 7, 2002, before the market opened for trading, the Company
shocked the market when it announced, among other things, that:
(a) it had failed to meet analysts' expectations on its earnings
for the second quarter by a wide margin;
(b) because of the slumping financial markets, it had canceled a
spinoff of its insurance underwriting businesses to
shareholders; and
(c) the SEC had began an investigation of its accounting and was
questioning several items in the Company's accounts, including
the reporting of investment write-downs, the timing of some
costs and a reinsurance recoverable item and the decision not
to consolidate certain special purpose vehicles.
The Company also stated that, if the SEC says it is necessary, it will
have to restate its earnings for the past three years, and reduce its
net income by $27 million in 1999, by $24 million in 2000 and by $5
million in the first quarter of 2002.
Following this report, shares of the Company fell $6.43 per share to
close at $14.77 per share, a one-day decline of 30.3%, on volume of
more than 20 million shares traded, or more than twenty times the
average daily volume.
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: Aoncase@milbergNY.com or visit the
firm's Website: http://www.milberg.com
ECLIPSYS CORPORATION: Charles Piven Commences Securities Suit in FL
-------------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired Eclipsys Corporation
(Nasdaq:ECLP) securities between July 23, 2001 and June 27, 2002,
inclusive, in the United States District Court for the Southern
District of Florida, against the Company and its Chief Executive
Officer, who is also a director, its Chief Financial Officer and its
Chief Operating Officer.
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
ICN PHARMACEUTICALS: Abbey Gardy Commences Securities Suit in C.D. CA
---------------------------------------------------------------------
Abbey Gardy, LLP initiated a securities class action against ICN
Pharmaceuticals, Inc. (NYSE:ICN) and certain of its officers and
directors in the United States District Court for the Central District
of California, on behalf of all persons or entities who purchased the
Company's securities during the period from May 3, 2001 and July 10,
2002, inclusive.
The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, by issuing a series of material
misrepresentations. The complaint alleges that the defendants made
materially false and misleading statements during the class period
that:
(1) materially misrepresented the Company's financial performance
(inflating reported revenues during the class period); and
(2) caused Company stock to trade at artificially-inflated prices.
For more details, contact Nancy Kaboolian, or Jennifer Haas by Phone:
800-889-3701 or by E-mail: nkaboolian@abbeygardy.com
ICN PHARMACEUTICALS: Charles Piven Commences Securities Suit in C.D. CA
-----------------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired ICN Pharmaceuticals, Inc.
(NYSE:ICN) securities between May 3, 2001 and July 10, 2002, inclusive,
in the United States District Court for the Central District of
California, Southern Division against the Company and:
(1) Milan Panic,
(2) Richard A. Meier and
(3) David C. Watt
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
JOHNSON & JOHNSON: Wolf Popper Commences Securities Suit in S.D. NY
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Wolf Popper LLP initiated a securities class action against Johnson &
Johnson (NYSE: "JNJ"), alleging violations of the federal securities
laws in the United States District Court for the Southern District of
New York.
The lawsuit relates to defendants' material misstatements concerning
its blockbuster drug EPREX, and its failure to disclose beginning in
April 2002, that the US Food and Drug Administration's Office of
Criminal Investigation had sought a stay of a whistleblower action
alleging the existence of manufacturing lapses at the Company's EPREX
manufacturing facility in Puerto Rico, and was conducting a criminal
investigation in connection with those allegations.
Defendants subsequently admitted in a press release dated August 1,
2002 that they "recognize and are concerned about the seriousness of
the allegations" made by the whistleblower - although they failed to
make disclosure of that whistleblower suit.
The undisclosed existence of the government's investigation was
critical information that an investor would want to know in light of
reports of 141 suspected cases of red cell aplasia (PRCA) in chronic
renal failure in patients taking EPREX. PRCA is a condition in which
the body loses its ability to produce red blood cells, leaving the
patient dependent on blood transfusions for survival.
In addition to failing to disclose the existence of the government
investigation, defendants misrepresented that EPREX "continues to be a
trusted brand that people are using," and that Johnson & Johnson was
"working very closely with the - with the experts, as well as health
authorities in understanding (PRCA), why it occurs. And we're doing
whatever we can to understand the risk and mitigate it."
The true facts concerning the existence of the criminal investigation
of Johnson & Johnson and the allegations of the qui tam action were
first revealed in The New York Times on July 19, 2002. That same day,
Johnson & Johnson admitted that it was aware of the criminal
investigation since April 2002. Once the foregoing information was
revealed, Johnson & Johnson shares fell $7.88 per share to close on
July 19, 2002, at $41.85, a fall of 16%.
The lawsuit was brought on behalf of all persons who purchased the
Company's common stock of Johnson & Johnson during the period April 16,
2002 through July 18, 2002, inclusive against the Company and certain
of its current and former officers and directors.
For more details, contact Michael A. Schwartz or Abigail Kowaloff by
Phone: 212-759-4600 or 877-370-7703 by E-Mail: IRRep@wolfpopper.com or
visit the firm's Website: http://www.wolfpopper.com
MERRILL LYNCH: Cohen Milstein Initiates Securities Suit in S.D. NY
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Cohen, Milstein, Hausfeld & Toll, PLLC initiated a securities class
action in the US District Court for the Southern District of New York
on behalf of purchasers of shares of the Merrill Lynch Internet HOLDRs
Trust (AMEX:HHH) during the period of Sept. 23, 1999, through April 8,
2002. The suit names as defendants:
(1) Merrill Lynch & Co., Inc. (NYSE:MER),
(2) Merrill Lynch, Pierce, Fenner & Smith,
(3) the Internet HOLDRs Trust and
(4) signatories of the Registration Statement and Prospectus filed
with the SEC on Sept. 23, 1999.
The complaint asserts claims under sections 11, 12(a)(2), and 15 of the
Securities Act of 1933. The complaint alleges, among other things,
that during the class period defendants issued false and misleading
statements, and omissions of material fact, in the Registration
Statement and Prospectus issued in connection with the initial public
offering of the Internet HOLDRS.
The Internet HOLDRs are "basket securities," and each Internet HOLDRs
share represents an undivided beneficial ownership in (initially) 20
specified companies in the Internet sector. Thus, the price of the
Internet HOLDRs was directly related to and moved with the price of the
Underlying Securities.
The complaint alleges that Merrill Lynch artificially inflated the
stock prices of Internet companies covered by Merrill Lynch, which
included many of the Internet HOLDRs' Underlying Securities, by having
its Internet Group analysts prepare and issue false and misleading
reports, and which did not set forth the true opinions held by those
analysts.
Merrill Lynch is alleged to have engaged in this scheme as part of a
larger pattern whereby Merrill Lynch Internet Group analysts, often
under pressure from the company's investment bankers, were initiating,
continuing and/or manipulating research coverage to maintain and
attract investment banking business. The complaint's allegations are
based, in part, on information from the investigation of Merrill Lynch
and its Internet Group conducted by the New York State Attorney
General.
For more details, contact Steven J. Toll or Diana Steele by Mail: 1100
New York Avenue, NW West Tower, Suite 500, Washington DC 20005 by
Phone: 888-240-0775 or 202-408-4600 by E-mail: stoll@cmht.com or
dsteele@cmht.com or visit the firm's Website: http://www.cmht.com
MSC INDUSTRIAL: Weiss & Yourman Commences Securities Suit in E.D. NY
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Weiss & Yourman initiated a securities class action against MSC
Industrial Direct Co., Inc. (NYSE:MSM), in the United States District
Court for the Eastern District of New York, on behalf of purchasers of
the Company's securities between November 4, 1999 and August 5, 2002.
The suit also names as defendants:
(1) Mitchell Jacobson,
(2) Sidney Jacobson,
(3) Shelley Boxer,
(4) Charles Boehlke,
(5) David Sandler,
(6) James Schroeder,
(7) Dennis Kelly,
(8) Raymond Langton,
(9) Roger Fradin and
(10) Philip Peller
The complaint alleges that defendants issued materially false and
misleading financial statements and press releases concerning the
Company's revenues, income and earnings per share during the class
period in violation of Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
For more details, contact James E. Tullman, David C. Katz, and Mark D.
Smilow by Mail: The French Building, 551 Fifth Avenue, Suite 1600, New
York, NY 10176 by Phone: 888-593-4771 or 212-682-3025 by E-mail:
info@wynyc.com
NICOR INC.: Charles Piven Commences Securities Fraud Suit in N.D. IL
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The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired Nicor, Inc. (NYSE:GAS)
securities between January 24, 2002 and July 18, 2002, inclusive, in
the United States District Court for the Northern District of Illinois,
against the Company and two of its senior officers.
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
PERKINELMER INC.: Bernstein Liebhard Commences Securities Suit in MA
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Bernstein Liebhard & Lifshitz LLP initiated a securities class action
on behalf of all persons who purchased or acquired PerkinElmer, Inc.
(NYSE: PKI) securities between July 15, 2001 and April 11, 2002, in the
United States District Court for the District of Massachusetts.
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 July 15, 2001 and April 11, 2002.
According to the complaint, the Company issued numerous press releases
regarding its performance during the class period which represented
that:
(1) the Company was successfully growing its revenues and
earnings;
(2) the Company's transformation into a provider of health-related
products and services was proceeding successfully; and
(3) the Company would meet its financial performance targets for
2002.
The complaint further alleges that these, and other representations,
were materially false and misleading because they failed to disclose
that:
(i) the Company was experiencing a decline in the demand for its
products, especially at its Optoeletronics division;
(ii) the Company was carrying tens of millions of dollars of
obsolete inventory on its books and the Company's expenses
were soaring due to the spate of numerous acquisitions and
divestitures it had undertaken.
On March 1, 2002, the Company issued a press release revealing that
first quarter of 2002 revenues and earnings would be materially less
than the Company had represented its figures would be only three weeks
earlier. In reaction to the announcement, the price of Company common
stock plummeted by 31%.
The full truth regarding the Company's business was not fully disclosed
until April 11, 2002, when the Company issued a press release revealing
that its reported earnings will be breakeven, instead of the figure of
$0.16-$0.17 per share that the Company had stated, on March 1, it
expects to earn, and that its revenues will decline in the first
quarter of 2002 because of weakness in all of its division.
In reaction to the announcement, Company stock plummeted by another
28%, falling from $16.70 per share on April 10, 2002 to $12.04 by the
close of April 11, on extremely heavy trading volume. The individual
defendants and other Company insiders sold a total of 595,000 Company
common stock during the class period, reaping gross proceeds in excess
of $18.4 million and the Company completed a significant acquisition
using its common stock as currency.
For more details, contact Linda Flood by Mail: 10 East 40th Street, New
York, New York 10016 by Phone: (800) 217-1522 or 212-779-1414 by E-
mail: PKI@bernlieb.com or visit the firm's Website:
http://www.bernlieb.com.
RIVERSTONE NETWORKS: Schiffrin & Barroway Lodges Securities Suit in CA
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Schiffrin & Barroway, LLP initiated a securities class action in the
United States District Court for the Northern District of California on
behalf of all purchasers of the common stock of Riverstone Networks,
Inc. (Nasdaq:RSTN) securities during the period between August 10, 2001
and June 5, 2002, inclusive.
The complaint charges the Company and certain of its officers and
directors with issuing false and misleading statements concerning its
business and financial condition. Specifically, the complaint alleges
that, during the class period, defendants desperately sought to create
the impression that the Company had the ability to directly enter these
markets with a captive client base.
Thus, the Company , through, among other things, its relationship with
Hutchison Global Crossing, could compete head-to-head with the dominant
companies in the industry. Prior to its relationship with Hutchison,
the Company was having difficulty gaining operational momentum within
these potentially lucrative Asian markets.
The complaint alleges that each defendant was aware that the Company
would be unable to meet its projected Q2 02 to Q1 03 revenue and
earnings per share (EPS) targets unless they manipulated the Company's
revenue, earnings and receivables.
However, because the "appearance" of growth was so critical to
defendants' plan to inflate the price of Company shares and sell their
own shares and raise monies via its $150 million debt offer, defendants
continued to maintain throughout the class period that the Company
would meet revenue projections and EPS when, in reality, defendants
knew that the Company could not achieve their projections without
attempting to fraudulently record revenue by inducing clients who
defendants knew did not have the ability to pay to agree to take
delivery of goods and that the Company was, in fact, suffering from
greater losses.
Defendants knew that if the Company's inability to generate legitimate
sales growth from customers who could actually pay was revealed,
together with the fact that the Company's projected growth was
contingent upon sales to clients which defendants knew would be unable
to pay pursuant to the Company's internal policy, if ever, due to their
own financial deterioration, defendants would not reap the financial
rewards of selling their own shares at artificially inflated prices
which totaled $7.1 and the $150 million debt offering would be just a
pipedream.
For more details, contact Marc A. Topaz or Stuart L. Berman by Phone:
888-299-7706 (toll free) or 610-667-7706 or by E-mail:
info@sbclasslaw.com
RIVERSTONE NETWORKS: Cauley Geller Commences Securities Suit in N.D. CA
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Cauley Geller Bowman & Coates, LLP initiated a securities class action
in the United States District Court for the Northern District of
California on behalf of purchasers of Riverstone Networks, Inc.
(Nasdaq: RSTN) securities during the period between August 10, 2001 and
June 5, 2002.
The complaint charges the Company and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. The
Company is a provider of metropolitan area networking solutions that
enable service providers to convert raw bandwidth into profitable
services over legacy and next-generation infrastructures.
During the class period, defendants desperately sought to create the
impression that the Company had the ability to directly enter these
markets with a captive client base. Thus, the Company, through, among
other things, its relationship with Hutchison Global Crossing, could
compete head-to-head with the dominant companies in the industry.
Prior to its relationship with Hutchison, the Company was having
difficulty gaining operational momentum within these potentially
lucrative Asian markets.
The complaint alleges that each defendant was aware that the Company
would be unable to meet its projected Q2 02 to Q1 03 revenue and
earnings per share (EPS) targets unless they manipulated the Company's
revenue, earnings and receivables. However, because the "appearance"
of growth was so critical to defendants' plan to inflate the price of
Riverstone shares and sell their own shares and raise monies via its
$150 million debt offer, defendants continued to maintain throughout
the class period that the Company would meet revenue projections and
EPS when, in reality, defendants knew that the Company could not
achieve their projections without attempting to fraudulently record
revenue by inducing clients who defendants knew did not have the
ability to pay to agree to take delivery of goods and that the Company
was, in fact, suffering from greater losses.
Defendants knew that if the Company's inability to generate legitimate
sales growth from customers who could actually pay was revealed,
together with the fact that the Company's projected growth was
contingent upon sales to clients which defendants knew would be unable
to pay pursuant to the Company's internal policy, if ever, due to their
own financial deterioration, defendants would not reap the financial
rewards of selling their own shares at artificially inflated prices
which totaled $7.1 and the $150 million debt offering would be just a
pipedream.
For more details, contact Jackie Addison, Sue Null or Ellie Baker 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
RIVERSTONE NETWORKS: Milberg Weiss Commences Securities Suit in N.D. CA
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Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class
action in the United States District Court for the Northern District of
California on behalf of purchasers of Riverstone Networks, Inc.
(NASDAQ:RSTN) securities during the period between August 10, 2001 and
June 5, 2002, including those who acquired Company shares and those who
acquired Company convertible notes.
The complaint charges the Company and certain of its officers and
directors with violations of the Securities Exchange Act of 1934.
During the class period, defendants desperately sought to create the
impression that the Company had the ability to directly enter these
markets with a captive client base.
Thus, the Company , through, among other things, its relationship with
Hutchison Global Crossing, could compete head-to-head with the dominant
companies in the industry. Prior to its relationship with Hutchison,
the Company was having difficulty gaining operational momentum within
these potentially lucrative Asian markets.
The complaint alleges that each defendant was aware that the Company
would be unable to meet its projected Q2 02 to Q1 03 revenue and
earnings per share (EPS) targets unless they manipulated the Company's
revenue, earnings and receivables. However, because the "appearance"
of growth was so critical to defendants' plan to inflate the price of
Company shares and sell their own shares and raise monies via its $150
million debt offer, defendants continued to maintain throughout the
class period that the Company would meet revenue projections and EPS
when, in reality, defendants knew that the Company could not achieve
their projections without attempting to fraudulently record revenue by
inducing clients who defendants knew did not have the ability to pay to
agree to take delivery of goods and that the Company was, in fact,
suffering from greater losses.
Defendants knew that if the Company's inability to generate legitimate
sales growth from customers who could actually pay was revealed,
together with the fact that the Company's projected growth was
contingent upon sales to clients which defendants knew would be unable
to pay pursuant to the Company's internal policy, if ever, due to their
own financial deterioration, defendants would not reap the financial
rewards of selling their own shares at artificially inflated prices
which totaled $7.1 and the $150 million debt offering would be just a
pipedream.
For more details, contact William Lerach by Phone: 800-449-4900 by E-
mail: wsl@milberg.com or visit the firm's Website:
http://www.milberg.com
SALOMON SMITH: Schiffrin & Barroway Commences Securities Suit in NY
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Schiffrin & Barroway, LLP initiated a securities class action against
Salomon Smith Barney, the investment banking/brokerage unit of
Citigroup, Inc. (NYSE: C), and its star telecommunications analyst,
Jack Grubman, in the United States District Court for the Southern
District of New York on behalf of all purchasers of the common stock of
Winstar Communications, Inc. (OTC: WCIIM.PK, WCIIO.PK, WCIIP.PK) common
stock during the period January 25, 2001 to April 17, 2001, inclusive.
The suit against the Company and Mr. Grubman alleges that defendants
violated the federal securities laws because their analyst reports
regarding Winstar were false and deceptive, thereby causing Winstar's
stock prices to be artificially inflated.
As alleged in the Complaint, on July 22, 2002, The Wall Street Journal
reported that the National Association of Securities Dealers (NASD) was
preparing to take regulatory action against both Mr. Grubman and
Salomon for violating NASD rules based on allegations that defendants
misled investors by touting shares of Winstar despite evidence that the
company was in deep financial trouble.
The suit seeks to recover damages caused to the Class by defendants'
violations of Section 10(b) of the Securities Exchange Act of 1934 and
Rule 10b-5 promulgated thereunder, and Section 20(a) of the Exchange
Act.
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 or by E-mail:
info@sbclasslaw.com
SALOMON SMITH: Cauley Geller Commences Securities Fraud Suit in S.D. NY
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Cauley Geller Bowman & Coates, LLP initiated a securities class action
against Salomon Smith Barney and its telecommunications analyst, Jack
Grubman in the United States District Court for the Southern District
of New York on behalf of purchasers of Winstar Communications, Inc.
(OTC Pinksheets: WCIIQ, WCIIM, WCIIO, WCIIP) common stock during the
period between January 25, 2001 and April 17, 2001, inclusive.
The suit against the Company and Mr. Grubman alleges that defendants
violated the federal securities laws because their analyst reports
regarding Winstar were false and deceptive, thereby causing Winstar's
stock prices to be artificially inflated.
As alleged in the Complaint, on July 22, 2002, The Wall Street Journal
reported that the National Association of Securities Dealers (NASD) was
preparing to take regulatory action against Mr. Grubman and Salomon for
violating NASD rules based on allegations that defendants misled
investors by touting shares of Winstar despite evidence that the
company was in deep financial trouble.
The Complaint seeks to recover damages caused to the Class by
defendants' violations of Section 10(b) of the Securities Exchange Act
of 1934 and Rule 10b-5 promulgated thereunder, and Section 20(a) of the
Exchange Act.
For more details, contact Jackie Addison, Sue Null or Ellie Baker by
Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 888-551-9944
or by E-mail: info@classlawyer.com
SEEBEYOND TECHNOLOGY: Wechsler Harwood Files Securities Suit in C.D. CA
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Wechsler Harwood Halebian & Feffer LLP initiated a securities class
action in the United States District Court for the Central District of
California on behalf all persons who purchased or acquired SeeBeyond
Technology Corp. (Nasdaq:SBYN) securities between December 10, 2001
through April 22, 2002, inclusive against the Company and certain of
its officers and directors.
The complaint charges the Company and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. The
complaint alleges that during the class period, defendants made
positive but false statements about the Company's results and business,
while concealing material adverse information about customers pushing
out orders.
As a result, Company stock traded at artificially inflated levels,
permitting defendants to complete a secondary public offering of 8.5
million shares (plus 1.2 million of an over-allotment) for proceeds of
$82 million, including 2 million shares sold by the Company's CEO.
Immediately before the offering, the Company announced its 4thQ 01
results, which met analyst expectations. Defendants represented that
the Company had met the numbers without pulling in sales from the 1stQ
02 such that 1stQ 02 results would be favorable as well. The Company
indicated it had good visibility into 1stQ 02 results and forecast
revenues of more than $44 million for that quarter.
On April 1,2002, the Company pre-announced its 1stQ 02 results in a
press release and conference call indicating it had revenues of $42.0
to $42.5 million in the 1stQ 02. The stock declined somewhat on what
was termed a "slight miss" from earnings estimates.
Within hours of this release, the Company's auditors called the Company
objecting to its revenue recognition on at least $2.2 million in
transactions. The Company concealed this problem over the following
weeks. Then, on April 22,2002, after the market closed, the Company
admitted the 1stQ 02 revenues were actually only $40.3 million. On
this news, the Company's stock dropped by 50% to $3.15 per share.
For more details, contact Patricia Guiteau by Mail: 488 Madison Avenue,
8th Floor, New York, New York 10022 by Phone: 877-935-7400 by E-mail:
pguiteau@whhf.com or visit the firm's Website: http://www.whhf.com
VIVENDI UNIVERSAL: Charles Piven Commences Securities Suit in S.D. NY
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The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who acquired Vivendi Universal
(NYSE:V) (Paris Bourse: EX FP) securities between February 11, 2002 and
July 3, 2002, inclusive, in the United States District Court for the
Southern District of New York, against the Company and Jean-Marie
Messier, the Company's former Chairman and Chief Executive Officer.
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
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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
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Beard Group, Inc., Washington, D.C. Enid Sterling, Aurora Fatima
Antonio and Lyndsey Resnick, Editors.
Copyright 2002. All rights reserved. ISSN 1525-2272.
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