/raid1/www/Hosts/bankrupt/CAR_Public/030327.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, March 27, 2003, Vol. 5, No. 61
Headlines
ALASKA: Non-Alaskan Fishermen May Get Refund For Triple-Priced Permits
ALASKA: Trial in Bristol Bay Salmon Price-fixing Suit To Resume April 1
ARIZONA: DPS, Governor Named As Defendants in Racial Profiling Lawsuit
BLOCKBUSTER VIDEO: Canadian Customers' Late Fees Suit Gets Class Status
CAPITAL ONE: AARP Joins Employees' Age Discrimination Suit in VA Court
CATHOLIC CHURCH: Boston Diocese Ask Appeals Court To Intervene in Suits
CINGULAR WIRELESS: Resellers To Commence Deceptive Trade Practices Suit
DAIMLERCHRYSLER: Racial Suit in Chicago Expands to Include Hispanics
EL PASO: Reaches Agreement To Settle Suits Over CA Natural Gas Market
GAYLORD CHEMICAL: Claimants in LA Rail Car Fire Suit To Receive Letters
MERRILL LYNCH: SEC Files Securities Charges Over Role in Enron Collapse
MISSOURI: Parents File Second PCHS Locker Room Tape Lawsuit
NEW JERSEY: Gov. McGreevey Signs Bill Making Racial Profiling A Crime
SOUTH KOREA: Business Community Supports Class Action, Business Reform
TALISMAN ENERGY: NY Court Allows Suit Over Sudan Involvement To Proceed
UNITED STATES: Survey States Women Less Likely To Have Higher Salaries
WEST PHARMACEUTICAL: NC Residents Commence Suit Over Factory Explosion
XTO ENERGY: OK Court Tentatively Approves Royalties Lawsuit Settlement
New Securities Fraud Cases
ACCLAIM ENTERTAINMENT: Kirby McInerney Files Securities Suit in S.D. NY
AFC ENTERPRISES: Schiffrin & Barroway Files Securities Suit in N.D. GA
AFC ENTERPRISES: Cauley Geller Files Securities Fraud Suit in N.D. GA
ANDRX CORPORATION: Milberg Weiss Launches Securities Lawsuit in S.D. FL
ANDRX CORPORATION: Charles J. Piven Launches Securities Suit in S.D. FL
ASTROPOWER INC.: Marc Henzel Commences Securities Lawsuit in DE Court
ATMEL CORPORATION: Marc Henzel Commences Securities Lawsuit in N.D. CA
BIO-TECHNOLOGY GENERAL: Marc Henzel Commences Securities Lawsuit in NJ
BLOCKBUSTER INC.: Marc Henzel Commences Securities Lawsuit in N.D. TX
CAMINUS CORPORATION: Marc Henzel Commences Securities Suit in S.D. NY
CAPRIUS INC.: Marc Henzel Commences Securities Fraud Suit in NJ Court
CARREKER CORPORATION: Marc Henzel Commences Securities Suit in N.D. TX
COSI INC.: Marc Henzel Commences Securities Fraud Lawsuit in S.D. NY
CYTYC CORPORATION: Marc Henzel Commences Securities Lawsuit in MA Court
eFUNDS CORPORATION: Marc Henzel Commences Securities Lawsuit in E.D. WI
INTERCEPT INC.: Marc Henzel Commences Securities Fraud Suit in N.D. GA
MCSI INC.: Marc Henzel Commences Securities Fraud Lawsuit in S.D. OH
VAXGEN INC.: Johnson & Perkinson Launches Securities Lawsuit in N.D. CA
*********
ALASKA: Non-Alaskan Fishermen May Get Refund For Triple-Priced Permits
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The class action launched two decades ago over the triple-priced fees
for licenses and permits non-Alaskan commercial fishermen were required
to pay as compared with fishermen from Alaska, is likely to result in a
judgment of nearly $30 million, the Associated Press Newswires reports.
The lawsuit, filed in 1984, has been to the Alaska Supreme Court on
appeal on three occasions. Recently, the appeals court remanded the
case to the Superior Court to make the necessary adjustments of its
ruling in accordance with the Supreme Court's latest decision on the
matter.
Juneau lawyer Loren Domke, who represents the plaintiffs, said that the
Constitution bars states from interfering with interstate commerce, and
charging higher fees does just that. The courts basically agree with
Mr. Domke.
The Alaska Supreme Court has ruled that the state can charge somewhat
higher fees to nonresident commercial fishermen for their permits and
licenses, but only enough to "compensate the state for any added
enforcement burden they may impose or for any conservation expenditures
from taxes which only residents pay."
According to Alaska's high court, nonresidents should be given "equal
access to the (fishing) resource on the condition that they make a
contribution to the maintenance of the resource equal to that made by
state residents."
Using the Alaska Supreme Court's reasoning in a ruling made on an
earlier appeal, Superior Court Judge Peter A. Michalski set out a
formula for the differential, that would allow nonresident fishermen to
be charged $156 more than residents for 1996, the base year used in the
calculation. Previously, the nonresidents were charged $750 as
compared with $250 for residents.
After reviewing Judge Michalski's decision, the Supreme Court, in its
most recent ruling, decided the state should charge for hatcheries and
some other expenses. Mr. Domke said this additional amount will add
about $20 a year to the cost for each nonresident fishermen.
The differential is calculated individually for each year back to 1984,
essentially based on the amount the state spent on fisheries divided by
the population. With interest over the years at 10.5 percent, the
biggest refund check for a nonresident permit holder could be about
$30,000, and the average check being $2,500 for the 11,000 people
involved.
Steven White, the assistant attorney general said, "We are years away
from a decision that orders the state to pay refunds." Mr. Domke
acknowledges that his fee is also years away. As winner in a civil
case, the state will pay his fee.
Mr. Domke said, "It is an interesting case, and the court has made some
law. Ultimately, the class members will be better off and there will
be a reduction of the differential, or an outright elimination of it."
Alaska recently changed the law to conform with the Supreme Court's
ruling. Last year, the first under the new structure, the state
charged a fee differential of $120 for nonresidents and charged
residents $60. The new law says the state can charge nonresidents the
resident fee "plus an amount established by the department by
regulation, that is as close as is practicable to the maximum allowed
by law."
ALASKA: Trial in Bristol Bay Salmon Price-fixing Suit To Resume April 1
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Trial in the long-running Bristol Bay salmon trial will commence on
April 1 in Anchorage Superior Court in Alaska, as participants take the
week off for spring break, the Anchorage Daily News reports. Jury
trial in the suit began on February 3 and is expected to last through
April.
The suit was filed on behalf of about 4,500 current and former
commercial sockeye salmon fishermen at Bristol Bay, alleging several
fish processors and Japanese seafood importers fixed the prices of
salmon. The fishermen are seeking more than $1 billion in damages.
Defense attorneys for the processors and importers argue that supply
and demand, not unlawful collusion, accounted for the lower prices
fishermen got for their catches in the disputed 1991-95 seasons, the
Daily News States.
The question of fair prices for Bristol Bay sockeye has been
investigated before and even aired before a jury, however, the court
has ruled that jurors in the current case won't be allowed to hear
about those earlier inquiries, the Daily News adds.
Two years ago, the US General Accounting Office investigation revealed
that supply and demand lowered Bristol Bay prices in 1991, when the
fishermen waged a bitter strike. However, the GAO did not investigate
price-fixing allegations.
In 1993, former Alaska assistant attorney general Jim Forbes conducted
an investigation, but found no 'conclusive evidence' of price fixing.
The probe also revealed, however, that 'various parties had the means,
opportunity and motive to reduce Bristol Bay salmon prices.' In 1981,
a Seattle federal court jury cleared Bristol Bay fish packers after a
four-month price-fixing trial.
ARIZONA: DPS, Governor Named As Defendants in Racial Profiling Lawsuit
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Arizona's Department of Public Safety (DPS) and Governor Janet
Napolitano faces a civil suit for racial profiling, the Arizona Daily
Sun reports. The suit was filed in the United States District Court in
Phoenix, Arizona, on behalf of all black and Hispanic motorists.
The suit was initiated after a Coconino County Superior Court judge
handed a decision to dismiss felony drug charges against eight persons,
who were targeted because of their race, Flagstaff attorney Lee Brooke
Philips stated. The Coconino County Attorney's office plans to appeal
the ruling. "Everything was on hold waiting to see what was going to
happen in the criminal cases," Mr. Phillips said.
Mr. Phillips also filed motions on Friday to have charges dismissed
against a Cuban man and a black man charged on felony drug offenses,
the Arizona Daily Sun states. Ricardo Tolliver, a black man, was
arrested for carrying marijuana and cocaine. Frank Vilas, a Cuban man
was arrested for carrying marijuana. Both face 20-year sentences from
a federal felony conviction. Both were stopped on Interstate 40 near
Flagstaff by DPS officers.
The suit asks for monetary damages on grounds DPS racially profiles
black and Hispanic men. Governor Napolitano was named in the suit,
because as head of state of Arizona, she is the ultimate head of DPS.
"We're also suing them to ask the federal court to step in and order
DPS to stop racial profiling and start collecting records and making
those records available to the public," Mr. Phillips said.
DPS spokesman Frank Valenzuela told the Daily Sun DPS has not yet
decided whether the officers will defend themselves individually or as
a group, or whether the officers will defend themselves at all. "If
the officers choose to fight it or not fight it, it's a little too soon
to really try to speculate on that," Mr. Valenzuela said.
BLOCKBUSTER VIDEO: Canadian Customers' Late Fees Suit Gets Class Status
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Possibly hundreds of millions of dollars is involved in the lawsuit
brought by Quebec customers against Blockbuster Video over the late
fees they have paid at the company's chain of stores, now that Justice
Marc de Wever of Quebec Superior Court has granted the plaintiffs'
lawsuit class action status, the Globe and Mail reports. Justice de
Wever ruled that there were sufficient common issues shared among the
Blockbuster customers who paid the late fees to warrant their having
standing as a distinctive class. No appeal of a class-action
certification is permitted under Quebec law.
The class action involves between 500,000 to 1.5 million Quebeckers,
who have paid the fees to Blockbuster between January 1992 and the
present, according to Montreal lawyer Robert Kugler, who represents the
plaintiffs. Mr. Kugler argued that Blockbuster's "deliberately abusive
policy" of late fees entitled those customers "exemplary damages" of at
least $100 each. It is within the court's discretion, however, to
determine the exact amount of compensatory and punitive damages.
Further, the lawsuit alleges that Blockbuster's late fees in Quebec
have violated the province's Consumer Protection Act by being
"excessive, abusive and exorbitant." One of the examples given is the
$4.79 Blockbuster has charged a customer for a two-evening rental of a
videocassette. The same amount has been charged for each additional
evening the video cassette is on loan until its return to the
Blockbuster store. As a result, two additional evenings have cost
$9.58.
Dallas-based Blockbuster is Canada's largest retail renter of movies
and video games. A successful class action filed in Texas against
Blockbuster in 2001, resulted in a ruling that gave United States
customers free video rentals and dollar-off coupons worth, upon
redemption, a total of $500 million.
CAPITAL ONE: AARP Joins Employees' Age Discrimination Suit in VA Court
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The AARP joined an age discrimination suit filed against Capital One
Financial Corporation in the United States District Court in Richmond,
Virginia, alleging that the Company implemented a plan of forced
separation that was discriminatory to employees aged 40 and older,
Reuters reports.
As many as 60 former company employees have joined the suit, which the
AARP, the nation's largest senior citizens lobby, will now co-counsel
with Richmond-based Butler, Williams, Pantele & Skilling. A motion
filed in court last week also expanded the period covered in the suit
from October 1, 2001, to the present. The lawsuit originally covered
the period from October 1, 2001, to September 30, 2002.
Harris D. Butler III of Butler, Williams, Pantele & Skilling told
Reuters that he expects the judge to rule within the next four months
on whether the lawsuit can proceed as a class action.
A Capital One spokesman told Reuters the company does not comment on
ongoing litigation. The Company has said the firings were the result
of poor performance under a forced-ranking employee-appraisal system.
AARP, however, told Reuters the forced-ranking system has been used by
some other companies to "mask a desire to jettison older workers and
other employees, even if they have previously received high ratings."
CATHOLIC CHURCH: Boston Diocese Ask Appeals Court To Intervene in Suits
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The Archdiocese of Boston asked the Massachusetts Appeals Court to
intervene in clergy sexual abuse lawsuits filed against it before they
go to trial, the Associated Press reports.
The archdiocese filed a motion last week with Appeals Court Justice
Scott Kafker, which alleged that because of the First Amendment
guarantee of freedom of religion, the courts should not get involved in
issues of whether church leaders were negligent in supervising and
assigning priests. The Archdiocese and its leaders face several suits
on behalf of nearly 500 plaintiffs, challenging the church's practice
of assigning known or suspected child abusers to new parishes without
warning the parishioners.
Last month, Superior Court Judge Constance M. Sweeney rejected the same
argument in a pretrial motion. She said that accepting the church's
argument would be the same as granting the archdiocese blanket immunity
from civil lawsuits. The archdiocese appealed this with the motion
filed last week
Archdiocese spokeswoman Donna Morrissey told AP the church continues to
negotiate with alleged victims, and still hopes to reach a resolution.
"Our first desire is to settle these cases," Ms. Morrissey said. "But
the attorneys for the church have a duty to exercise all available
defenses."
The archdiocese said it filed the motion to show that it did everything
possible to defend itself to its insurance companies. Church officials
hope at least part of any settlement costs, estimated at millions of
dollars, will be covered by insurance, AP states.
CINGULAR WIRELESS: Resellers To Commence Deceptive Trade Practices Suit
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Cingular Wireless resellers are set to commence a class action,
charging the Company with breach of contract, fraud and deceptive trade
practices, the New York Post reports. The suit will be filed as early
as this week.
The suit was spurred by the findings and evidence presented in a case
brought against the Company by Scott Kempner, a Chicago-area wireless-
service retailer who sued Cingular two years ago. In the suit, Mr.
Kempner seeks $25 million in damages, and alleges fraud, deceptive
trade practices, coercion, theft of customers, intimidation and
contract violations. Recently, Mr. Kempner was granted an injunction
that allows his stores to sell competing wireless services. The suit
is also proceeding, with a hearing scheduled for May. "The ruling is
out, and the barn door is open. Here comes the class-action lawsuit,"
Mr. Kempner said.
The Company said it was "unaware of this suit . We would like the
chance to examine its claims before commenting," Cingular spokesman
Clay Owen told the New York Post.
The Company also sees the injunction in the Kempner suit as a victory
for its side. "The Court's March 7 preliminary ruling was a reassuring
win for Cingular Wireless," Mr. Owen said. "The decision allows
Cingular to protect our customers, our name and our trademarks .
Secondly, and more importantly, we are pleased that this ruling upholds
the integrity of our business practices. We consider agents and
dealers our true business partners, and we are committed to working
collaboratively with them for our mutual benefit."
The class action will initially involve only a few current and former
resellers, sources said, but the class could eventually involve
hundreds of business owners around the country. The suit comes at a
precarious time for Cingular, a joint venture owned by SBC
Communications and BellSouth. The California Public Utilities
Commission is investigating the company due to numerous consumer
complaints related to billing, coverage and contract termination. It
is the first time the agency has investigated a wireless company, the
NY Post reports.
DAIMLERCHRYSLER: Racial Suit in Chicago Expands to Include Hispanics
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Attorneys representing a group of African-Americans who claim they were
denied loans by DaimlerChrysler (NYSE: DCX) based on their race and
where they live say they have expanded the proposed class action
lawsuit to include Hispanic car purchasers living near Chicago, after
other minorities came forward with similar experiences.
The original suit claims Chrysler management systematically and
intentionally denies low-interest vehicle financing to creditworthy
blacks in two Chicago neighborhoods. The amended complaint, filed in
United States District Court in Chicago, now includes allegations that
Chrysler's management is using similar redlining practices in Berwyn,
Illinois, near Chicago.
More than a third of Berwyn's population is Hispanic.
"Since we filed the original complaint against Chrysler earlier this
month, we've learned of other areas in which we believe that Chrysler
has thrown the switch on what Chrysler claims is a color-blind credit-
rating system," said Steve Berman, managing partner of Hagens Berman,
the firm leading the case against Chrysler. "As we learn more about the
case, it is becoming clear that Chrysler's actions in Chicago are not
limited to one area, or one minority group."
Berman says the firm is expanding its investigation due to reports of
redlining by Chrysler from across the country.
According to internal Chrysler documents, operators of the Automated
Credit Evaluation (ACE) system override the purportedly color-blind
system, rerouting credit applications from specific dealers for a
subjective manual review.
The complaint argues that the ACE system also allows zone managers to
flag every application from an individual dealership for increased
scrutiny by Chrysler employees. The complaint cites internal documents
that note "the Zone Manager can use any criteria to decide whether or
not to place a dealer on Watch."
"We believe Chrysler selectively chooses high minority areas and rigs
the system to have minority applications tossed into a 'reject' bin,"
Berman added.
The suit names DaimlerChrysler Services North America, LLC, d/b/a
Chrysler Financial Company, LLC, a wholly owned subsidiary and captive
financing arm of DaimlerChrysler, as the defendant.
The complaint argues that customers from the Berwyn dealership began to
be systematically denied Chrysler financing after a visit from Chrysler
zone manager Ben Boggs. During his visit, the complaint states that
Boggs viewed the dealership's new Spanish language television
commercial targeted towards Hispanics, and immediately commented,
"That's a very 'colorful' commercial you have there. I just hope all
those accounts will be collectible."
Attorneys believe that after viewing the commercial, Boggs ordered all
applications from the Berwyn dealership pulled from the ACE system for
increased scrutiny.
The suit cites Boggs as making racially derogatory comments about
African Americans and credit risks associated with financing auto
purchases for minorities, including asking, "Well guys, what did we
decide to do with Gerry's nigger deals? Ha-ha," at a meeting attended
by a top-level Chrysler executive. According to the complaint, the
Chrysler vice president was not surprised by Boggs' use of racist
language.
Berman noted that evidence of redlining from another minority area
dealership severely weakens Chrysler's claims that the first complaint
was simply a business dispute between a dealership and Chrysler.
Jamie Maldonado and Juely Rivera, two named plaintiffs added to the
suit, applied for financing from Chrysler at the Suburban Dodge of
Berwyn dealership, located in the Chicago suburb of Berwyn. Despite
having above-average credit ratings, the complaint states that Chrysler
denied the couple financing.
However, the suit states that Chrysler then suggested that Rivera apply
individually. Even after this reapplication, Chrysler initially
rejected her credit application, and subsequently only offered
financing options at an extraordinarily high 15 percent over a period
of 60 months, according to the complaint. The couple eventually
received much better financing from another financial institution, but
still at interest rates higher than they should have received from
Chrysler, the suit argues.
According to attorney Berman, Rivera purchased another vehicle through
Chrysler in July 2002 -- prior to Boggs's comments -- and received a
competitive interest rate.
In response to the allegations in the suit, clergymen from across the
United States organized a nationwide boycott of DaimlerChrysler on
March 15. U.S. Congressman Bobby Rush, Illinois State Senator Donne
Trotter and more than 300 African American clergymen have appealed for
the resignation of several executives named in the suit and asked
African American investors to sell their Chrysler stock immediately.
The suit describes meetings between Chrysler and its dealerships in
which Chrysler executives disclosed -- using racist slurs and
derogatory comments -- that Chrysler did not want to finance car
purchases by blacks, claiming they are inherently higher credit risks.
The class-action suit seeks damages related to civil rights violations
and the paying of higher interest rates by plaintiffs, as well as
punitive damages to deter the company from discriminatory conduct.
For more information contact Steve Berman of Hagens Berman by Phone:
+1-206-623-7292 by E-mail: steve@hagens-berman.com; or Mark Firmani of
Firmani & Associates, Inc. by Phone: +1-206-443-9357 by E-mail:
mark@firmani.com; or visit the the firm's Web site: http://www.hagens-
berman.com.
Berman is joined in the litigation by attorneys Edward Vrdolyak, Eugene
Pincham and William Hooks.
EL PASO: Reaches Agreement To Settle Suits Over CA Natural Gas Market
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El Paso Corporation has reached an agreement to pay almost $1.7 billion
to settle suits over its role in allegedly manipulating California's
natural gas market. The specifics of the settlement, which could be
announced as early as Thursday, were still being negotiated Wednesday,
the San Francisco Chronicle reported, citing unidentified sources.
According to the report, the settlement calls for the Company to offer
$1 billion in aggregate discounts on natural gas and power purchases to
California consumers over the next 20 years. It was unknown how those
discounts could affect the prices California consumers pay for natural
gas. The Company would also pay $225 million to several California
government agencies and private businesses in cash and stock, the
newspaper said, and an additional $440 million in cash paid out to the
same parties over the next 20 years.
It would also include a $100 million payment to other Western states,
including Nevada, Oregon and Washington, the Chronicle said. Also, the
report said top El Paso executives who were paid $2 million in bonuses
as a reward for the company's profits during California's energy crisis
would forfeit that money.
Houston-based El Paso suggested the report was premature. "We do not
have a settlement, and therefore it would be inappropriate to comment
at this time," a company spokesperson said Thursday, according to the
Associated Press. The settlement is still about $2 billion less than
the amount California claims it's owed by El Paso. California
officials allege the state was overcharged $3.7 billion in 2000 and
2001.
GAYLORD CHEMICAL: Claimants in LA Rail Car Fire Suit To Receive Letters
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More than 16,000 claimants in the Louisiana class action filed against
Gaylord Chemical Corporation will be sent allocation letters informing
them how much their first checks will amount to by Wednesday, James
"Pete" Farmer, plaintiff's liaison counsel, told the Bogalusa Daily
News. In fact the mailings began Friday, he said.
The two companies have earlier agreed to settle the suit filed payouts
involving a 1995 rail car explosion that sent a noxious gas cloud over
an area surrounding the chemical company's Bogalusa, Louisiana plant,
according to an earlier Class Action Reporter story.
The letters from the court appointed special master, Patrick Juneau,
inform each claimant the net payment he or she will receive if all four
preliminarily approved settlements are finally approved during fairness
hearings on August 28. The amounts of payment vary according to the
evaluation of each individual claim, the Daily News states.
Additionally, if any of the four settlements are not finally approved
this summer, the payment amounts would be lowered accordingly, said
Farmer. However, since Gaylord and Union Tank Car have not yet settled
in the case and are due to go to trial September 2, additional
disbursements may be made after that date. There are more than 16,500
claimants in the Louisiana class action lawsuit, and an additional
3,700 Mississippi claimants filed individually as a result of the 1995
chemical release in Bogalusa, the Daily News states.
MERRILL LYNCH: SEC Files Securities Charges Over Role in Enron Collapse
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Merrill Lynch & Co., Inc. and four of its former executives face
charges filed by the United States Securities and Exchange Commission
(SEC), over its role in helping Enron Corporation artificially inflate
its profits, in the United States District Court in Houston, Texas,
Reuters reports. The complaint states, "Merrill Lynch and its former
executives aided and abetted Enron Corp.'s earnings manipulation by
engaging in two fraudulent year-end transactions in 1999."
The investigation centers on a deal between Enron and Merrill Lynch
over power-generating barges in Nigeria and a series of trades between
Enron and Merrill's energy trading division. Enron allegedly used the
transactions to pad its 1999 fourth-quarter income by $60 million and
its full-year 1999 earnings per share to $1.17 from $1.09, the SEC
stated. Merrill also allegedly bought an interest in the Nigerian
barges from Enron at the end of 1999 with the understanding that Enron
would arrange for its sale within six months at a specified rate of
return.
"In substance, this transaction was, at best, a bridge loan because the
risks and rewards of ownership did not pass to Merrill Lynch," the
commission said, according to Reuters. The other transaction involved
energy trades that Merrill believed "were essentially a wash" and that
it "knew had the purpose and effect of inflating Enron's income by
approximately $50 million," the SEC said.
Merrill announced last month that it had agreed to pay $80 million to
settle the case, a move that it said "concludes the SEC's investigation
into Enron-related matters with respect to the company."
SEC Enforcement Division Director Stephen Cutler said the $80 million
was one of the five largest penalties ever imposed in a civil
securities enforcement action. "Even if you don't have direct
responsibility for a company's financial statements, you cannot turn a
blind eye when you have reason to know that what you are doing will
help make those statements false and misleading," Mr. Cutler said in a
statement.
In a statement, the SEC said the four former Merrill executives named
in the complaint -- Robert Furst, Schuyler Tilney, Daniel Bayly and
Thomas Davis -- "are contesting the matter."
Ira Sorkin, Mr. Furst's attorney, told Reuters, "We do not believe he
did anything improper or anything that violated federal securities
laws, and we intend to defend the action."
Mr. Tilney's attorney, Robert Trout, told Reuters, "Schuyler Tilney did
not engage in any wrongdoing. He is a person of great integrity and
would never participate in a fraudulent scheme."
Thomas Fitzpatrick, attorney for Mr. Davis, said his client "gave final
approval to the Nigerian barge transaction after it had been thoroughly
vetted by legal counsel . He did not aid Enron in fraudulently
accounting for the transaction and he did not even know how Enron
booked the transaction."
Bayly's attorney could not immediately be reached, Reuters states.
Merrill neither admitted nor denied wrongdoing. The firm said last
month it would also consent to an injunction barring it from violating
federal securities laws under the deal.
MISSOURI: Parents File Second PCHS Locker Room Tape Lawsuit
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Parents from seven western Montana high schools commenced a second
class action against Powell County High School (PCHS), after they
discovered that their daughters who have used the locker rooms at the
school may have been secretly videotaped by three male PCHS seniors,
the Montana Forum reports.
The suit names as defendants three school employees - the high school
principal, athletic director and yearbook adviser, and seeks $100,000
in compensatory damages for each of the 19 plaintiffs and class action
members, plus $10 million in punitive damages "due to reckless
disregard of constitutional rights." Named in the suit are:
(1) Rick Duncan, principal,
(2) Donald McDermid, athletic director and
(3) Pat Bannon, yearbook adviser
The suit, filed in the United States District Court in Helena by
Missoula, alleges that the defendants gave former PCHS seniors Eddy
Newman, Ben Frankforter and Matt Thomas access to the girls' locker
room by making them towel boys, and failed to supervise the teens
properly and "inspect and control" the locker rooms.
The three seniors pleaded guilty last December to felony burglary
charges and admitted to installing two-way mirrors in the girls' and
boys' locker rooms, the Montana Forum states. They surreptitiously
observed and videotaped undressed female athletes, including those
visiting for tournament play.
Judge Ted Mizner handed down a two-year deferred sentence and ordered
them to apologize to the victims, serve 30 days in jail and complete
250 hours of community service. The school board expelled all three
from Powell County High School.
Earlier, the plaintiffs filed a suit against the three seniors in state
District Court. That suit states that the plaintiffs and their
daughters have suffered severe emotional distress, and asks for
compensatory and punitive damages to be proved at a jury trial.
According to the complaint, Duncan oversees activities at PCHS;
McDermid invites other teams to participate in team sports and
supervises the locker rooms; and Bannon is responsible for the content
of the PCHS yearbook.
The nine-page document alleges McDermid loaned locker room keys to
students in violation of school policy. Duncan knew of the practice and
didn't stop it.
The 2001-02 high school yearbook included three references to
videotapes and secret viewing of females in bathrooms and locker rooms,
but the defendants didn't investigate them, the complaint states.
The harm ultimately caused to the plaintiffs' children and class
members was foreseeable and a direct result of the defendants' actions,
the lawsuit alleges. The school employees acted in willful disregard
for the children's safety and constitutional rights to privacy, the
complaint states.
Kathleen DeSoto, a Missoula attorney who represents the Powell County
High School board of trustees, said early Friday she expects she will
represent the three PCHS employees, but she hasn't had a chance yet to
meet and talk to her clients.
"We're limited as to what we can say at this point because I haven't
had a chance to meet with these men," she said. "I don't even know if
all of the defendants have been served yet."
They will review the complaint and evaluate the allegations, she said.
"From the school district's point of view, they believe that these
three defendants acted appropriately and did everything they
foreseeably could have done to protect the privacy of those people who
used the locker room," she said.
The school district itself was put on notice earlier this month that
the same group of parents will likely pursue legal action against the
district and the county alleging negligence and violation of civil
rights.
The parents include Laurie Wilson, Joani Manning, Rob and Stephanie
Dean, Dan Sullivan, Catherine Slingsby, Susan Trulock, Janeice
Dahlseid, Fred and Sandy McDonald, Linda Carlson, AudreyO'Neill,
Michelle Cole, Mary Fields and four names referred to in court
documents as Harry A., Jane Doe I, Jane Doe II and Tami S.
NEW JERSEY: Gov. McGreevey Signs Bill Making Racial Profiling A Crime
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The State of New Jersey has instituted a law to make race-based arrests
and public searches a crime, Reuters reports. Democratic Gov. Jim
McGreevey signed the law, which will make racial profiling punishable
up to five years' imprisonment and a $15,000 fine.
The new law seeks to stop public intimidation against individuals due
to race, gender, ethnicity, physical handicaps, religion or sexual
orientation. It did not prohibit police from using race or ethnicity
alongside other characteristics as a means of identifying or
apprehending suspects, Reuters states.
New Jersey is the first state to implement this law. The signing
marked a victory for civil rights activists who had asked for such a
law since April 1998 when two state troopers pulled over a van of black
and Hispanic men for a traffic stop on the New Jersey Turnpike, and
fired 11 times into the vehicle. The incident led to national outrage,
a US Justice Department investigation, police reforms and lawsuits.
"For years, minority motorists have complained of being the victims of
racial profiling," Gov. McGreevey said, according to Reuters. "They
have complained of being illegally targeted, stopped, harassed and
searched based on their race or ethnicity. This bill makes racial
profiling a criminal act."
SOUTH KOREA: Business Community Supports Class Action, Business Reform
----------------------------------------------------------------------
South Korea's business community agreed to support a key tenet of new
president Roh Moo-Hyun's reform drive against corporate corruption by
supporting the introduction of class action suits by minority
shareholders, the Taipei Times reports. The agreement was forged at a
meeting of five business organizations, including the Federation of
Korean Industries (FKI), which represents the interests of the giant
conglomerates known as chaebols.
President Roh was elected to office last month. He sought to introduce
class actions and several other reforms to halt corruption and illegal
stock trading used by chaebol owners to strengthen their hold on their
industries. However, he also called for stricter rules to stop
minority shareholders from abusing their class action rights, and
demanded that the system be introduced next year and reviewed after
five years.
The drive initially sparked protests from the corporate sector, saying
the reforms would hurt the economy. Last week, prosecutors indicted 10
SK Group executives for falsifying accounts to inflate earnings,
intensifying the concerns over the bill.
FKI vice chairman Hyun Myung-Kwan told the Taipei Times the
organizations agreed in principle to allow minority shareholders to
file class action suits over corporate irregularities.
President Roh conceded yesterday in a speech to businessmen that South
Korea's economy was being pressured by high oil prices and the stand-
off over North Korea's nuclear ambitions. "Our economy faces
considerable difficulties. It's time for us to take firm
countermeasures," he said.
He stressed he would push ahead with reforms to rein in the chaebols,
whose over-expansion and iron grip on the economy hampered the
country's ability to compete and contributed to the 1997 to 1998
economic crisis, the Taipei Times reports. "We have to implement
reform in economic, political and all other quarters. Reform is a
prerequisite to enhance competitiveness," he said.
TALISMAN ENERGY: NY Court Allows Suit Over Sudan Involvement To Proceed
-----------------------------------------------------------------------
United States District Court for New York Judge Allen Schwartz ruled
that Canadian oil and natural gas producer Talisman Energy Inc. can be
held liable for genocide if it can be proved that it co-operated with
the Sudanese government to wage war on civilians near oilfields, the
Associated Press reports.
Judge Schwartz allowed the class action filed in November 2001 against
the Company to proceed. The suit alleges that the Company and the
Sudanese government are violating the human rights of Christian and
other non-Muslim minorities in Southern Sudan by conducting a
deliberate campaign of ethnic cleansing to clear the land for oil
exploitation, an earlier Class Action Reporter story states.
In 1997, Sudan was classified by the US Government as a state sponsor
of international terrorism. On October 31, 2001, President Bush
extended sanctions against Sudan declaring "the actions and policies of
the Government of Sudan continue to pose an unusual and extraordinary
threat to the national security and foreign policy of the United
States."
After years of criticism, the Company pulled out of war-torn Sudan,
selling its Sudanese oil interests last week for CN$1.1 billion. The
buyer of Talisman's 25 per cent stake in the Greater Nile oil project
was the state-owned oil company of India, which now joins the Sudanese
government and the national oil companies of China and Malaysia as
owners of the joint venture, AP states. A lawyer for the company did
not immediately return a call seeking comment.
The Company earlier asked the court to dismiss the suit, saying it was
improperly filed in the United States and that it was barred by several
laws narrowing the instances in which individuals can bring lawsuits
for injuries in other countries. However, Judge Schwartz said the case
was properly brought in federal court in Manhattan by organizations
claiming to represent all non-Muslim and African Sudanese residents who
live within 80 kilometers of oil production areas and transportation
routes in the Sudan.
Judge Schwartz further threw out rejected arguments that allowing the
case to proceed to trial might embarrass or hinder the foreign
relations of the United States, which has tried to broker peace within
Sudan and has engaged in dialogue with Sudan about terrorism, AP
states.
In trading on the Toronto Stock Exchange on Wednesday, Talisman
(TSX:TLM) shares fell 34 cents to CAD$57.21.
UNITED STATES: Survey States Women Less Likely To Have Higher Salaries
----------------------------------------------------------------------
The United States Census Bureau released a survey that revealed that
women are less likely than men to reach the highest salary brackets and
are more likely to live in poverty, the Associated Press reports. The
survey was conducted in March 2002, and was being released to coincide
with Women's History Month
The survey revealed that almost 16 percent of men age 15 and older who
worked full-time in 2001 earned at least $75,000 a year, compared with
6 percent of women. About 20 percent of men earned between $50,000 and
$75,000, compared to 12 percent of women. The survey also revealed
that women are more likely than men to live in poverty, especially at
older ages.
Despite lingering disparities, a separate Census Bureau report last
week showed that earning levels for women are at record highs, with
those holding college diplomas especially benefiting. The number of
women with at least a bachelor's degree is also at a record high, the
Associated Press reports.
Other findings in the survey state:
(1) in the workplace, 9.4 million women worked in executive or
managerial positions - 45 percent of such jobs in 2002. Women
held the majority of the jobs in the field of technical or
related support services. Nearly one-quarter of the 63.6
million working women in 2002 worked in administrative or
clerical positions, larger than any other field;
(2) Of the 282.1 million US residents in March 2002, 51 percent
were women;
(3) Women age 15 and older were slightly less likely than men in
the same age group to be married and living with their spouse
(51 percent and 54 percent, respectively). However, women
were much more likely to be widowed than men (10 percent
versus 3 percent).
The survey did not cover group populations, such as those living in
jails or nursing homes.
WEST PHARMACEUTICAL: NC Residents Commence Suit Over Factory Explosion
----------------------------------------------------------------------
West Pharmaceutical Services and plant manager Thomas Clagon face a
purported class action filed by three Lenoir County, North Carolina
residents, over the fatal explosion at the Company's Kinston factory.
The explosion killed six people, destroyed the sprawling factory
complex and left Lenoir County without one of its largest industrial
employers, the New Bern Sun Journal reports.
The suit charges negligence over the suit. In court papers filed in
Craven County, plaintiffs Terry Ellis, Rosalie Whitley and Gloria Young
allege they suffered damages from the blast and are entitled to
financial compensation. The plaintiffs did not work at the plant, but
allege they suffered property damage because of the explosion. They
allegedly were to potentially hazardous chemicals in the smoke that
followed it.
"It was a community harm," New Bern attorney Donald J. Dunn, one of
seven attorneys handling the complaint told the Journal. Other
counsels in the case are from Louisiana. Mr. Dunn said he was
approached by the Louisiana attorneys to be local counsel. He said he
filed the claim in New Bern because he believes several Craven County
residents were harmed in the blast. Their names soon will be added to
an amended version of the lawsuit, The Sun Journal reports.
A federal probe stated that the blast was an accident caused by the
ignition of airborne dust particles inside the plant. Investigations
by a federal chemical safety agency and by state labor officials
continue on the site.
The suit includes seven claims for relief:
(1) Negligence by the Company. The complaint alleges West failed
to keep its plant safe, failed to remedy defects in the
plant's operation and failed to use care with the handling of
dangerous chemicals;
(2) Negligence by plant manager Thomas Clagon. The lawsuit claims
Mr. Clagon failed to exercise reasonable care in the operation
of the factory, failed to properly supervise employees, failed
to inspect the factory and its components and failed to
properly handle hazardous chemicals there;
(3) A Woodson claim on behalf of company employees. Under North
Carolina law, workers must seek remedy for economic and health
damages through worker's compensation claims before the
Industrial Commission. However, they can sue in state court
for pain and suffering if they believe an employer has
committed acts that led to their injuries; and
(4) Strict liability. The plaintiffs are seeking relief on the
claim that the company was engaged in work so hazardous that
it is responsible for any damages even if negligence is not
proven.
No one from West could be reached for comment on the lawsuit. Court
filings list Raleigh attorneys Rodney Pettey and Brian M. Williams as
the company's representatives. Mr. Williams declined comment Friday,
and Mr. Pettey could not be reached for comment, the Sun Journal
states.
"Some situations are so dangerous that people get hurt sooner or
later," New Bern attorney Donald Dunn said.
XTO ENERGY: OK Court Tentatively Approves Royalties Lawsuit Settlement
----------------------------------------------------------------------
The District Court of Dewey County, Oklahoma tentatively approved the
settlement of a class action pending against XTO Energy Inc. (formerly
known as Cross Timbers Oil Company, on behalf of royalty owners of
natural gas wells in Oklahoma.
The suit alleges that since 1991, the Company has underpaid royalty
owners as a result of reducing royalties for improper charges for
production, marketing, gathering, processing and transportation costs
and selling natural gas through affiliated companies at prices less
favorable than those paid by third parties, an earlier Class Action
Reporter story states.
XTO Energy currently estimates that the portion related to the trust is
approximately $850,000, or 2.1 cents per unit. This amount reflects
the trust's 80% share of the settlement relating to production from the
underlying properties for periods since December 1, 1998, the date of
creation of the trust. Assuming that the court approves the settlement
at a fairness hearing in April 2003 and that no appeal is filed, and
based on XTO Energy's anticipated settlement payment date of July 2003,
this amount will reduce the trust's August 2003 distribution, which is
paid to unitholders in September. The effect of the settlement on
future distributions for other months will not be significant.
New Securities Fraud Cases
ACCLAIM ENTERTAINMENT: Kirby McInerney Files Securities Suit in S.D. NY
-----------------------------------------------------------------------
Kirby McInerney & Squire, LLP initiated a securities class action in
the Court for the Southern District of New York on behalf of purchasers
of Acclaim Entertainment, Inc. (Nasdaq:AKLM) publicly-traded securities
between January 22, 2002 and September 19, 2002, inclusive.
The complaint alleges that, during the Class Period, the defendants
materially misrepresented Acclaim's financial results so as to make
them seem better than they in fact were, and that such
misrepresentations caused Acclaim's stock to trade at artificially-
inflated prices during the Class Period. The action seeks to recover
damages allegedly suffered by investors who purchased Acclaim shares at
such artificially-inflated prices.
Specifically, the complaint alleges that defendants improperly
capitalized software development costs and overstated earnings by
recording declining allowances for returns and price concessions
together with failing to write down receivables despite deteriorating
customer quality and increasing delinquent accounts receivables. As a
result of this inflation, the complaint alleges, Acclaim was able to
complete on advantageous terms a private placement offering raising net
proceeds of $21.5 million on April 11, 2002. Months after the offering
was completed, Acclaim revealed that its fiscal year 2002 first and
second quarter results and 2003 projections were false when issued. As
a result of this news, Acclaim stock dropped from a Class Period high
of $5.85 to less than $1 per share.
For more information contact Ira M. Press, Esq. or Ori Braun by Phone:
(212) 371-6600 or (888) 529-4787 by E-mail: obraun@kmslaw.com or visit
the firm's Web site: http://www.kmslaw.com
AFC ENTERPRISES: Schiffrin & Barroway Files Securities Suit in N.D. GA
----------------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a securities class
action in the United States District Court for the Northern District of
Georgia on behalf of all purchasers of the common stock of AFC
Enterprises, Inc. (Nasdaq:AFCE) from March 2, 2001 through March 24,
2003, inclusive.
The Complaint 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 March 2, 2001 and March 24, 2003, thereby artificially
inflating the price of AFC securities.
The Complaint alleges that these statements were materially false and
misleading because they failed to disclose and misrepresented the
following adverse facts, among others:
(a) that the Company was improperly accounting for the value of
certain long-lived assets, thereby artificially inflating its
operating results;
(b) that the Company was improperly accounting for the sale of
corporate-owned stores to franchisees, thereby artificially
inflating its operating results;
(c) that the Company was improperly accounting for cooperative
advertising costs, thereby understating its advertising expenses
and artificially inflating its operating results;
(d) that the Company's Seattle Coffee Company was improperly
accounting for inventory, sales allowances and slotting fees;
and
(e) as a result of the foregoing, the Company's financial statements
published during the Class Period were not prepared in
accordance with Generally Accepted Accounting Principles and,
therefore, it was not true that the Company's financial
statements were a "fair presentation" of the Company's financial
position.
Indeed, by announcing its intention to restate its financial
statements, AFC has admitted that its prior financial statements were
materially false and misleading when issued.
On March 24, 2003, after the market closed, AFC shocked the market by
announcing that it would be restating its financial statements for
fiscal year 2001 and the first three quarters of 2002. The Company also
reported that it was examining whether or not its financial statements
for fiscal year 2000 should be restated. In response to this negative
announcement the price of AFC common stock dropped precipitously,
falling to as low as $12.30 per share, on extremely heavy trading
volume.
For more details contact Marc A. Topaz, Esq. or Stuart L. Berman, Esq.
by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by
Phone: (toll free) 1-888-299-7706 or 1-610-667-7706, by E-mail:
info@sbclasslaw.com
AFC ENTERPRISES: Cauley Geller Files Securities Fraud Suit in N.D. GA
---------------------------------------------------------------------
The Law Firm of Cauley Geller Bowman Coates & Rudman, LLP initiated a
securities class action in the United States District Court for the
Northern District of Georgia, Atlanta Division, on behalf of purchasers
of AFC Enterprises Inc. (Nasdaq: AFCE) publicly traded securities
during the period between March 2, 2001 and March 24, 2003, inclusive.
The Complaint 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 March 2, 2001 and March 24, 2003, thereby artificially
inflating the price of AFC securities.
The Complaint alleges that these statements were materially false and
misleading because they failed to disclose and misrepresented the
following adverse facts, among others:
(a) that the Company was improperly accounting for the value of
certain long-lived assets, thereby artificially inflating its
operating results;
(b) that the Company was improperly accounting for the sale of
corporate-owned stores to franchisees, thereby artificially
inflating its operating results;
(c) that the Company was improperly accounting for cooperative
advertising costs, thereby understating its advertising expenses
and artificially inflating its operating results;
(d) that the Company's Seattle Coffee Company was improperly
accounting for inventory, sales allowances and slotting fees;
and
(e) as a result of the foregoing, the Company's financial statements
published during the Class Period were not prepared in
accordance with Generally Accepted Accounting Principles and,
therefore, it was not true that the Company's financial
statements were a "fair presentation" of the Company's financial
position. Indeed, by announcing its intention to restate its
financial statements, AFC has admitted that its prior financial
statements were materially false and misleading when issued.
On March 24, 2003, after the market closed, AFC shocked the market by
announcing that it would be restating its financial statements for
fiscal year 2001 and the first three quarters of 2002. The Company also
reported that it was examining whether or not its financial statements
for fiscal year 2000 should be restated. In response to this negative
announcement the price of AFC common stock dropped precipitously,
falling to as low as $12.30 per share, on extremely heavy trading
volume.
For more details contact Samuel H. Rudman, Esq. or David A. Rosenfeld,
Esq. by Mail: P.O. Box 25438 Little Rock, AR 72221-5438 by Phone: (toll
free) 1-888-551-9944 by E-mail: info@cauleygeller.com or visit the
firm's Web site: http://www.cauleygeller.com
ANDRX CORPORATION: Milberg Weiss Launches Securities Lawsuit in S.D. FL
-----------------------------------------------------------------------
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP initiated a
securities class action on behalf of purchasers of the securities of
Andrx Corporation (Nasdaq:ADRX) between October 31, 2002 and March 4,
2003 inclusive. The action, numbered 03-20700, is pending in the United
States District Court for the Southern District of Florida, Miami
Division, against the Company and
(1) Richard J. Lane(CEO)
(2) Angelo C. Malahias (CFO)
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 October 31, 2002 and March 4, 2003.
The Complaint alleges that defendants failed to disclose that Andrx's
generic version of Wellbutrinr SR, which was being reviewed by the FDA,
had a short expiration period and that the Company's stockpile of this
drug would likely expire before the Company had obtained FDA approval
to market the drug.
The complaint further alleges that Andrx had released information to
investors concerning its expectation of FDA approval to market the
Company's generic version of Wellbutrin by year-end 2002. On October
31, 2002, according to the complaint, Andrx's CEO told investors that
the Company was "continu(ing) to build inventories of (Wellbutrin) and
other generic products prior to their launches." Information regarding
the drug's short commercial life and the probability that the Company
would need to write off the value of its inventory, which was material,
or take a material charge if its supply of the drug was not soon sold
was not revealed, the complaint alleges. On March 5, 2003, Andrx
disclosed that it would take a $26.3 million charge against its generic
versions of Wellbutrinr SR/Zybanr because FDA concerns over the drugs'
expiration dating kept it from being marketed. Andrx would also have to
resubmit its applications to produce generics of these drugs. The
Company's stock price declined 31% following the news.
For more details contact Steven G. Schulman by Mail: One Pennsylvania
Plaza, 49th fl. New York, NY, 10119-0165 by Phone: 800/320-5081 by E-
mail: Andrxcase@milbergNY.com or visit the firm's Web site:
http://www.milberg.com
ANDRX CORPORATION: Charles J. Piven Launches Securities Suit in S.D. FL
-----------------------------------------------------------------------
The Law Offices of Charles J. Piven, P.A. initiated a securities class
action on behalf of shareholders who purchased, converted, exchanged or
otherwise acquired the common stock of Andrx Corporation (Nasdaq:ADRX)
between October 31, 2002 and March 4, 2003, inclusive. The case is
pending in the United States District Court for the Southern District
of Florida against defendants Andrx 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 queries, contact Charles J. Piven by Mail: The World Trade Center-
Baltimore, 401 East Pratt Street, Suite 2525, Baltimore, Maryland 21202
by E-mail: hoffman@pivenlaw.com by Phone: 410/986-0036.
ASTROPOWER INC.: Marc Henzel Commences Securities Lawsuit in DE Court
---------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the District of Delaware on
behalf of purchasers of the securities of AstroPower, Inc. (Nasdaq:
APWR) between February 22, 2002 and August 1, 2002, inclusive, and who
suffered damages thereby. The action, is pending against the Company,
Allen M. Barnett (CEO and President) and Thomas J. Stiner (CFO).
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 February 22, 2002 and August 1, 2002.
The complaint alleges that AstroPower develops, manufactures, markets
and sells a range of solar electric power generation products. The
complaint further alleges that the company claimed that it was well
positioned to take advantage of the increasing demand for solar power
products.
The complaint further alleges that, throughout the class period, the
Company reported strong revenue and earnings growth and that, as a
result of these statements and reports, which were disseminated to the
investing public, and which formed the basis for research analysts'
reports on the Company, the Company's per share stock price reached a
Class Period high of $27 on March 28, 2002.
In truth and in fact, throughout the Class Period, the Company was
unable to effectively manage its expanding and increasingly complex
operations; it was, inter alia, unable to allocate resources among its
various manufacturing facilities to effectively meet regional demand or
to tailor its production capacity to actual demand. Consequently,
during the time that the Company was stating that it was well
positioned to take advantage of the increased demand for solar
products, it was in fact losing ground to more effective competitors.
Additionally, to maintain the illusion that its operations were
successful, the Company throughout the Class Period reported
artificially inflated revenue and earnings by, inter alia, recording
revenue in advance of shipment, contrary to its stated principles of
revenue recognition.
The truth was revealed on August 1, 2002 when, after the close of
trading, the Company announced its results for the second quarter ended
June 30, 2002. Analysts were stunned. Reported revenue and net income
had not grown but, on the contrary, second quarter income was $365,000,
or $0.02 per diluted share compared to $1.7 million, or $0.07 per
diluted share in the year-earlier second quarter and revenue of $20.4
million represented only a one percent increase over reported revenue
for the prior quarter and was approximately $4.9 million below
analysts' consensus estimate.
On this news, AstroPower's share price plunged 48%, or $7.12, to $7.77,
its lowest price in almost three years.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
ATMEL CORPORATION: Marc Henzel Commences Securities Lawsuit in N.D. CA
----------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of
California on behalf of all persons who acquired securities of Atmel
Corporation (NasdaqNM: ATML) From January 20, 2000 to July 31, 2002.
The case is pending against the Company, George Perlegos, and Donald
Colvin.
The complaint charges that during the class period, 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, thereby artificially inflating the
price of Atmel securities.
Specifically, the complaint alleges that, defendants inflated the
Company's revenues and earnings by concealing that Atmel was selling
defective chips to its customers, which would lead to product recalls,
repairs, and loss of customer relationships. The complaint further
alleges that while Atmel's stock price was artificially inflated,
Defendants sold more than $500 million in notes in a private placement
offering.
This scheme was revealed on July 31, 2002, when news reports disclosed
that Seagate Technology, Inc. had filed a lawsuit alleging that Atmel
chips caused flaws in millions of disk drives Seagate manufactured from
1999 to 2001. On this news, the Company's stock price declined to
$2.96.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
BIO-TECHNOLOGY GENERAL: Marc Henzel Commences Securities Lawsuit in NJ
----------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
on behalf of shareholders who purchased, converted, exchanged or
otherwise acquired the common stock of Bio-Technology General Corp.
(NasdaqNM: BTGC) between April 19, 1999 and August 2, 2002, inclusive,
in the United States District Court for the District of New Jersey
against the Company and certain of its executive 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 Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
BLOCKBUSTER INC.: Marc Henzel Commences Securities Lawsuit in N.D. TX
---------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of Texas,
Dallas Division on behalf of all purchasers of the common stock of
Blockbuster, Inc. (NYSE: BBI) from April 24, 2002 and December 17,
2002, inclusive.
The complaint charges Blockbuster, Inc. and certain of its officers and
directors with issuing false and misleading statements concerning its
business and financial conditions. Specifically, the complaint alleges
that throughout the class period, as alleged in the complaint,
defendants issued numerous positive statements regarding the Company's
financial performance and its future prospects.
The complaint alleges that these statements were each materially false
and misleading when made as they misrepresented and/or omitted the
following adverse facts which then existed and disclosure of which was
necessary to make the statements made not false and/or misleading,
including:
(1) that Blockbuster's business was being negatively impacted by
declining DVD sale prices. As the prices of DVDs declined,
consumers began to purchase DVDs from a variety of retail
outlets, instead of renting them, thereby causing Blockbuster
to experience declining rental sales;
(2) that Blockbuster was unable to effectively compete with other
retailers of DVDs as many of those retailers offered DVDs as
loss leaders -- selling the DVDs below or at cost -- in order
to entice shoppers into the store. As a result, Blockbuster
was experiencing declining DVD sales as it lost sales to mass
merchandisers;
(3) as a result, growth at stores that were open for more than one
year was slowing to such an extent that the same-store growth
rates that defendants had promised investors would not be
realized;
(4) that Blockbuster was experiencing problems with certain of the
movie studios with whom it had profit-sharing arrangements.
In particular, Blockbuster was being accused by Buena Vista of
breaching the terms of its revenue sharing agreement with it.
After the class period, Buena Vista brought suit against
Blockbuster for $120 million and alleged breach of contract;
and
(f) as a result of the foregoing, defendants' lacked a reasonable
basis for their earnings projections and positive statements
about the Company at all times.
On December 18, 2002, Blockbuster shocked investors when it slashed its
earnings estimates and cut its growth rate for same-store sales and
attributed the revisions to the negative impact of lower DVD prices
which was increasing sales of DVDs and decreasing rentals. In
response, the price of Blockbuster common stock declined precipitously,
falling from $19.40 per share to $13.64 per share on extremely heavy
trading volume.
Prior to the disclosure of this adverse information to the market, the
Individual Defendants and certain other high-level executives of
Blockbuster sold their personally-held Blockbuster common stock to the
unsuspecting public, reaping proceeds of more than $25 million.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
CAMINUS CORPORATION: Marc Henzel Commences Securities Suit in S.D. NY
---------------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court, Southern District of New York, on
behalf of purchasers of the securities of Caminus Corporation (NASDAQ:
CAMZ) between February 12, 2002 and July 8, 2002, inclusive. The
action is pending against the Company, David Stoner, John Andrus and
Joseph Dwyer.
The complaint alleges that defendants violated Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of material misrepresentations to the
market between February 12, 2002 and July 8, 2002, thereby artificially
inflating the price of Caminus securities.
The complaint alleges that Caminus is a provider of software and
strategic consulting services that facilitate energy trading,
transaction processing, risk management and decision support within the
wholesale energy markets. Throughout the class period, as alleged in
the complaint, defendants issued statements regarding the Company's
financial performance and filed a prospectus which described the market
for energy trading software. 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's business was coming under increasing
pressure as many of Caminus's clients were deferring purchases
and/or determining not to proceed at all with planned
purchases;
(2) that the Company's strategic consulting business was not
performing to the Company's expectations and would not be able
to contribute the revenues and earnings that were anticipated;
and
(3) that the market for Caminus's products was quickly
deteriorating as many energy companies were being heavily
scrutinized by regulatory authorities, experiencing declining
financial condition and grappling to fix the deficiencies in
their respective businesses.
Moreover, energy trading -- an area where Caminus provided software
systems -- was in steep decline as many of the major players exited the
field amid scandal.
On July 8, 2002, the Company shocked the market when it announced that
revenues for the second quarter would be $18 million -- $7 million less
than previously promised on June 3rd -- and that the Company now would
experience a loss of between $0.18 to $0.20 per share as compared to
the $0.03 per share profit previously represented. Following this
report, shares of Caminus fell $2.96 per share, or $49.7%, to close at
$2.99 per share, on extremely heavy trading volume.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
CAPRIUS INC.: Marc Henzel Commences Securities Fraud Suit in NJ Court
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The Law Offices of Marc S. Henzel initiated a securities class action
on behalf of purchasers of the securities of Caprius, Inc. (OTC BB:
CAPR.OB) between February 14, 2000 and June 25, 2002.
The complaint alleges, among other things, violations of the federal
securities laws, including Sections 10(b) and 20(a) of the Securities
and Exchange Act of 1934, and Rule 10b-5 promulgated thereunder,
against the Company, and its top two officers, defendants George Aaron
and Jonathon Joels. The action, is pending in the United States
District Court, District of New Jersey.
According to the complaint, the Individual Defendants first devised a
fraudulent plan and scheme by which they sought to obtain control of
Caprius. In May 1999, the Individuals Defendants proposed a merger
transaction to Caprius' Board of Directors (the "Board") and executive
officers. On June 28, 1999, Caprius consummated a merger through which
the Individual Defendants acquired 45.6% ownership of Caprius --
equivalent to 6,178,978 million shares of Caprius' common stock.
The complaint alleges that once they gained control of Caprius, the
individual defendants breached their fiduciary duties to Caprius and
its shareholders by disseminating false and misleading statements
concerning Caprius' business, operations, and financial results for
fiscal 1999, 2000, 2001, and portions of fiscal 2002.
The complaint alleges that the Individual Defendants:
(1) made misrepresentations to the Board and its officers in
connection with Caprius' June 1999 merger with Opus
Diagnostics, Inc.;
(2) misrepresented to the Board and its officers that the
Individual Defendants were in a financial position to and
would in fact consummate -- pre-merger -- the asset purchase
called for in the merger agreement; would invest $1 million of
their personal capital into the merged entity;
(3) exploited Caprius' resources by using Caprius' personnel,
office space, and assets to run their private business, the
Portman Group;
(4) diverted Caprius' assets to their personal use by using
Caprius' funds to consummate -- post-merger -- the asset
purchase; causing Caprius to enter into a series of
transactions designed to dilute public ownership in Caprius
securities;
(5) gouged Caprius' resources by spending substantial time
pursuing unrelated, personal business interests while
receiving a salary from Caprius;
(6) deceived Caprius' Board and its officers into consummating the
merger, resulting in business losses and consequential
damages; and
(7) breached their fiduciary duty to Caprius and its shareholders
by subordinating the rights and interests of Caprius'
shareholders to their own; depleting the assets of Caprius,
increasing Caprius' debt, thereby diluting the value of
Caprius securities; causing Caprius to borrow money to cover
debt that the Individual Defendants unnecessarily created; and
borrowing money on preferential terms to the lenders.
Because of the individual defendants' fraudulent practices, Caprius'
stock traded at artificially inflated prices during the class period.
Further, due to these practices, Caprius' stock price steadily declined
to its current price of $0.09 per share, since reaching a high price of
$1.12 per share in February 2000. As alleged in the Complaint, the
intentional or reckless misconduct of the Individual Defendants has
severely damaged Caprius and its shareholders.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
CARREKER CORPORATION: Marc Henzel Commences Securities Suit in N.D. TX
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The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of Texas,
Dallas Division, on behalf of purchasers of the securities of Carreker
Corporation, (Nasdaq: CANIE) between May 20, 1998 and December 10, 2002
inclusive, and who sustained damages thereby. The action, is pending
against the Company, John D. Carreker (Chairman and CEO) and Terry L.
Gage (CFO).
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 May 20, 1998 and December 10, 2002.
According to the complaint, throughout the class period, Carreker filed
financial statements with the SEC which represented that the Company
was consistently delivering numerous consecutive quarters of record,
double-digit growth, which the Company attributed to the strong demand
for its products and Carreker's business model.
In addition, according to the complaint, the Company expressly assured
investors of its "dedication to transparent reporting practices" and
highlighted the supposed "quality and integrity of (Carreker's)
accounting and corporate governance practices." These statements were
materially false and misleading, according to the complaint, because
they failed to disclose that the Company had been improperly
recognizing revenues throughout the class period, thereby artificially
inflating its revenues, income and earnings per share.
On December 10, 2002, the Company issued a press release announcing
that it was investigating whether revenues were improperly recognized
by being booked at once instead of ratably over a period of time, as
required by applicable generally accepted accounting principles. This
belated disclosure severely and negatively impacted Carreker's stock
price, causing it to fall by 22.6% in one day on extremely heavy
trading volume, from a December 9 close of $5.08 per share to close at
$3.93 per share on December 10.
Subsequently, the SEC initiated an investigation, which is ongoing,
into the Company's accounting practices. On January 28, 2003, the
Company announced that it will be restating the financial reports it
has filed since 1998.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
COSI INC.: Marc Henzel Commences Securities Fraud Lawsuit in S.D. NY
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The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Southern District of New
York on behalf of purchasers of the common stock of Cosi, Inc. (NASDAQ:
COSI) between November 22, 2002 to February 4, 2003 inclusive and who
were damaged thereby. The action, is pending against the Company and:
(1) Andrew M. Stenzler (CEO and Chairman),
(2) Jonathan M. Wainwright, Jr. (President) and
(3) Kenneth S. Betuker (CFO)
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 November 22, 2002 to February 4, 2003.
As alleged in the complaint, the Registration Statement and Prospectus
for the Company's November 22, 2002 IPO contained several sections
which discussed the Company's plans for growth and described how the
proceeds raised from the IPO would enable the Company to implement
these plans.
The complaint further alleges that similar representations were made by
Mr. Stenzler in an interview broadcast on CNNfn. These statements were
materially false and misleading, according to the complaint, because:
(i) they failed to disclose that the funds raised by the IPO
would be insufficient to implement the Company's expansion
plan, contrary to defendants' Class Period representations;
and
(ii) at the time of the IPO, defendants should have known that the
costs of expansion would be greater than the cash available to
the Company (which included working capital and proceeds from
the IPO), making it highly improbable that the Company would
be able to successfully continue to open numerous new stores
at such a rapid pace.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
CYTYC CORPORATION: Marc Henzel Commences Securities Lawsuit in MA Court
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The Law Offices of Marc S. Henzel initiated a securities class action
on behalf of purchasers of the securities of Cytyc Corporation (NASDAQ:
CYTC) between July 25, 2001 to June 25, 2002 inclusive and who were
damaged thereby. The action, is pending in the United States District
Court for the District of Massachusetts, against the Company and:
(1) Patric Sullivan (CEO throughout the Class Period, President
until January 30, 2002, Chairman since November 7, 2001) and
(2) Robert L. Bowen (CFO)
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 25, 2001 to June 25, 2002. Among
other things, the complaint alleges that throughout the class period
Cytyc issued press releases representing that it was enjoying record
revenue and earnings growth, increasing the market share of its primary
product (ThinPrep), that its revenues would grow by 25% in 2002 over
2001, to $275-$300 million, and that the Company was not negatively
impacted, and would not be negatively impacted, by the general economic
slowdown that was well underway at the time.
These statements were materially false and misleading, according to the
complaint, because they failed to disclose that the Company's
seemingly-impressive revenue and earnings growth was attributable, in
material part, to overstocking of inventory at the laboratories which
purchased ThinPrep in large volumes in reaction to deep discounts
offered by Cytyc (which recognizes revenue upon shipment).
The complaint further alleges that defendants were motivated to commit
the alleged securities laws violations in order to pump up the
Company's results so that it could use its inflated stock as currency
for key corporate acquisitions. On December 3, 2001, Cytyc acquired
Pro-Duct Health, Inc. for $167 million in Cytyc common stock and cash
and, on February 2, 2002, announced that it has entered a definitive
merger agreement to acquire Digene Corporation using Cytyc common stock
and cash. At the time of the announcement, the Digene acquisition was
valued at $554 million.
On April 24, 2002, after the close of trading, Cytyc revealed, in a
conference call, that its revenues and earnings for 2002 would be
materially less than the market had been led to believe. Instead of
revenues between $295-$305 million, the Company stated 2002 sales would
be as low as $270 million, and reduced earnings expectations from $0.66
per share to $0.55-$0.55 per share.
According to the Company, the cut was due to inventory reduction by its
customers (laboratories), which had overstocked ThinPrep in the first
quarter of 2002 and would meet end-user demand from inventory instead
of new orders. In response to the announcement, which was contrary to
repeated assurances by the Company, the price of Cytyc common stock
plummeted by 36.5%, falling from a $24.80 per share close on April 24
to close at $15.73 on April 25, on extremely heavy trading volume.
The truth regarding the Company's business, however was still
undisclosed, according to the complaint. On June 25, 2002, Cytyc
shocked the market by again lowering its expected revenues for 2002 to
$230- $245 million and earnings per share to $0.40- $0.44. In a
conference call held later that day, Cytyc announced that it was
considering switching its revenue recognition model from its current
recognition-on-shipment to a system more reflective of end-user demand.
In response, Cytyc's stock price plummeted again, this time by 39%,
falling from a $11.46 per share close on June 24, to close at $6.88 per
share on June 25, on extremely heavy trading volume.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
eFUNDS CORPORATION: Marc Henzel Commences Securities Lawsuit in E.D. WI
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The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Eastern District of
Wisconsin on behalf of purchasers of eFunds Corporation (Nasdaq: EFDS)
publicly traded securities during the period between February 2, 2001
and October 24, 2002, inclusive. The suit names as defendants the
Company and:
(1) John A. Blanchard III (CEO and Chairman from February 2, 2001
to September 15, 2002),
(2) Paul F. Walsh (CEO and Chairman since September 16, 2002),
(3) Paul H. Bristow (Executive Vice President and CFO from
February 2, 2001 to June 30, 2002) and
(4) Thomas S. Liston (Interim Financial Officer since July 1,
2002)
The defendants allegedly 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 February 2, 2001 to October 24, 2002. For example,
according to the complaint, throughout the class period, eFunds issued
press releases announcing quarter after quarter of record results of
operations, with revenues and earnings doubling in several quarters
during the class period. The financial statements contained in such
press releases were repeated in quarterly and annual reports filed with
the SEC.
According to the complaint, such statements were materially false and
misleading because they failed to disclose that eFunds had been
improperly recognizing revenue during the class period. Specifically,
according to the complaint, the Company recognized revenues on certain
contracts immediately which, according to generally accepted accounting
principles, should have been deferred over a period of time.
Accordingly, the complaint alleges, eFunds materially inflated its
revenues and revenue growth rate throughout the class period. On March
4, 2002, eFunds issued a press release announcing that it was "revising
its previously announced results of operations for the year ended
December 31, 2001" because the Company had recognized revenue from two
transactions in the second quarter of 2001 which should have been
recorded in the third quarter as a single transaction, or, in the
alternative, as a reduction in operating expenses instead of revenue.
The revision required a reduction of the Company's reported 2001
revenue by $5 million.
According to the complaint, that announcement, however, did not
disclose the truth regarding the Company's improper revenue
recognition. On October 25, 2002, before the open of trading, eFunds
shocked the market by announcing that it would "delay the release of
its earnings for the quarter ended September 30, 2002, while the
Company completes a review of the accounting treatment given to various
transactions that occurred in 2000 and 2001 and certain tax matters
related to the Company's India based operations."
In response to the announcement, the price of eFunds common stock fell
by 10% in one day, from a close of $9.65 per share on October 24, 2002
to close at $8.68 per share on October 25, 2002, on unusually large
trading volume, and representing a decline of 66% from the Class Period
high of $25.49 per share reached on May 18, 2001.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
INTERCEPT INC.: Marc Henzel Commences Securities Fraud Suit in N.D. GA
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The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of
Georgia, on behalf of all persons who purchased securities of Intercept
Inc. (Nasdaq: ICPT) between September 16, 2002 and January 9, 2003,
inclusive, and who were injured thereby. The action, is pending
against the Company and:
(1) John W. Collins (Chief Executive Officer),
(2) G. Lynn Boggs (President and Chief Operating Officer),
(3) Scott Meyerhoff (Chief Financial Officer), and
(4) Garrett M. Bender (President and Chief Executive Officer of
Internet Billing Co. Ltd. (iBill) a wholly owned subsidiary of
the Company)
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 September 16, 2002 and January 9,
2003. The complaint charges the Company and certain of its executive
officers with violations of federal securities laws.
Among other things, the plaintiff claims that defendants' material
omissions and the dissemination of materially false and misleading
statements concerning Intercept's business operations and financial
performance caused Intercept's stock price to become artificially
inflated, inflicting damages on investors. InterCept and the
Individual Defendants made material misrepresentations and/or omitted
to make material disclosures throughout the class period due to their
false assurances that the adult pornography internet portion of their
merchant processing business was insignificant and their failure to
disclose that VISA regulations implemented on November 1, 2002, which
were targeted specifically to address risks of internet pornography
card processing, had caused a material loss of business.
When defendants belatedly acknowledged the impact on InterCept's
business, the market's reaction to the disclosures was swift and
severe. Following these disclosures, the market price of InterCept
common stock dropped nearly 50% from a $18.51 to slightly over $8 per
share at the close of trading on January 10, 2003, after the
disclosures were made.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
MCSI INC.: Marc Henzel Commences Securities Fraud Lawsuit in S.D. OH
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The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Southern District of Ohio,
Western Division on behalf of purchasers of MCSi, Inc. (Nasdaq: MCSI)
for violations of federal securities laws. The complaint names as
defendants the Company, the Company's Chief Executive Officer,
President and Chairman of the Board Michael E. Peppel, and its Chief
Financial Officer and Vice-President, Ira H. Stanley.
The suit was filed on behalf of Company shareholders who purchased the
Company's securities between July 24, 2001 and February 26, 2002. The
complaint alleges that during this seven-month period MCSi "made untrue
statements of material fact and/or omitted to state material facts
necessary to make the statements not misleading . in an effort to
maintain artificially high market prices for MCSi's securities in
violation of (U.S. securities law)."
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
VAXGEN INC.: Johnson & Perkinson Launches Securities Lawsuit in N.D. CA
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Johnson & Perkinson initiated a securities class action in the United
States District Court for the Northern District of California on behalf
of purchasers of VaxGen, Inc. (NASDAQ:VXGN) securities during the
period between August 6, 2002 and February 26, 2003.
The complaint charges the Company and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. The
Company is engaged in the development and commercialization of AIDSVAX,
a vaccine designed to prevent infection or disease caused by HIV (Human
Immunodeficiency Virus), the virus that causes AIDS. Throughout the
class period, defendants caused VaxGen to make a number of positive
statements about the status of its clinical trials required to obtain
FDA approval to market AIDSVAX as an AIDS vaccine, causing VaxGen's
stock to trade at artificially inflated prices.
On February 23, 2003, VaxGen shocked the market by reporting the long-
anticipated results of the US trials, disclosing that the "study did
not show a statistically significant reduction of HIV infection within
the study population as a whole, which was the primary endpoint of the
trial." The partial disclosure of the overall failure of the US
clinical trial caused VaxGen's shares to plummet, declining over 50% to
approximately $3 per share on February 24, 2003.
However, even when defendants released the results on February 24,
2003, they claimed that while the vaccine failed to demonstrate
efficacy on US caucasians, the trials had demonstrated 30%- 84%
efficacy rates in US blacks and Asians. That analysis, the Company
said, had less than a 1% chance of being due to random chance, making
it highly statistically significant.
VaxGen President Donald P. Francis touted the results as evidence that
AIDSVAX could protect against HIV infection. As reported by The Wall
Street Journal on February 24, 2003, the "results overall won't lead
the Food and Drug Administration to approve the vaccine for use in the
wider public, but the company hopes that further analysis, as well as
results from another trial being conducted in Thailand on injection
drug users, may prompt the agency to approve the vaccine for some
ethnic minorities." These corrective statements had their intended
effect and VaxGen's stock closed at close to $7 per share on February
24, 2003.
On February 26, 2003, defendants were forced to admit that the
reliability of their earlier reports of higher efficacy rates for non-
caucasians were impaired because they had not taken the requisite
"penalties" to account for the fact that less than 500 of the 5000
clinical trial participants were non-caucasians, resulting in an
extremely small subset of data being analyzed for non-caucasions. As
the news that earlier promises that AIDSVAX could prove useful for non-
caucasions fell apart, the stock declined further, resulting in a total
loss in market cap since November 18, 2002 of approximately 85%.
For more details, contact Robin Freeman or James Conway by Mail: 1690
Williston Road, South Burlington, Vermont 05403 by Phone:
1-877-266-2133 or by E-mail: email@jpclasslaw.com
*********
S U B S C R I P T I O N I N F O R M A T I O N
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Copyright 2002. All rights reserved. ISSN 1525-2272.
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