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/raid1/www/Hosts/bankrupt/CAR_Public/030616.mbx C L A S S A C T I O N R E P O R T E R Monday, June 16, 2003, Vol. 5, No. 117 Headlines BIG LOTS: Employees Commence Two Overtime Wage Suits in CA Court CALIFORNIA: Los Angeles To Settle Lawsuit Over Homeless Sweeps CANADA: Quebec Court Upholds Settlement of Suit V. Royal Trust DAIMLERCHRYSLER AG: DE Court Certifies Securities Fraud Lawsuit DELOITTE & TOUCHE: Firm To Delay Summons For LeisureNet Lawsuit DYNEGY INC.: Three Former Execs Charged With Conspiracy, Fraud EXXON MOBIL: Appeals Court Upholds $1.2B Award in Fraud Lawsuit GROUP HEALTH: Class in Lawsuit Given One Week To Submit Claims LANTRONIX INC.: Plaintiffs File Consolidated Stock Lawsuit in CA MBNA CORPORATION: Faces Lawsuit Over TWA Frequent Flyer Program OKLAHOMA: Pilcher, School District Join Tar Creek Superfund Suit SCHWEGMANN GIANT: LA Appeals Court Upholds $5.4M Award THQ INC.: CA Court Grants Approval to Fraud Suit Settlement UNITED STATES: Representatives Pass Class Action Fairness Act WASHINGTON DC: Court Rules in City's Favor in Red Light Lawsuit WORLDCOM INC.: Judge Considers Stock Award, Along with $5M Pact New Securities Fraud Cases BARRICK GOLD: Cauley Geller Lodges Securities Fraud Suit in NY BARRICK GOLD: Milberg Weiss Files Securities Suit in S.D. NY eUNIVERSE INC.: Abbey Gardy Commences Securities Suit in C.D. CA FEDERAL HOME: Wolf Haldenstein Lodges Securities Suit in E.D. VA GOLDMAN SACHS: Pomerantz Haudek Files Securities Suit in S.D. NY MERRILL LYNCH: Berger& Montague Files Securities Suit in S.D. NY ORTHODONTIC CENTERS: Marc Henzel Lodges Securities Lawsuit in LA ORTHODONTIC CENTERS: Schatz & Nobel Lodges Securities Suit in LA PARADIGM MEDICAL: Marc Henzel Lodges Securities Lawsuit in Utah REGENERON PHARMACEUTICALS: Marc Henzel Files Stock Lawsuit in NY SARA LEE: Marc Henzel Commences Securities Fraud Suit in N.D. CA SUPERGEN INC.: Marc Henzel Lodges Securities Lawsuit in N.D. CA ULTIMATE ELECTRONICS: Marc Henzel Lodges Securities Suit in CO UNUMPROVIDENT CORPORATION: Marc Henzel Files TN Securities Suit ********* BIG LOTS: Employees Commence Two Overtime Wage Suits in CA Court ---------------------------------------------------------------- Big Lots, Inc. faces two class actions filed in the Superior Court of San Bernardino County, California, relating to the calculation of earned overtime wages for certain of the Company's former and current store managers and assistant store managers in that state. Each of the lawsuits was filed by plaintiffs who are current or former store managers or assistant store managers on behalf of themselves and other similarly situated store managers and assistant store managers. The lawsuits allege that the Company improperly classified such employees as exempt under California's wage and hour laws and seek damages, restitution, reclassification and attorneys fees and costs. While the alleged damages in these lawsuits are substantial, the Company denies these actions and is pursuing alternative dispute resolution possibilities. The Company believes that if an adverse resolution of these cases occurs, it could have a material adverse effect on the Company's results of operations for the year in which resolution occurs. However, management does not believe that such an adverse resolution would have a material adverse effect on the Company's financial condition or liquidity. Where and to the extent that the Company believes that a loss is probable and can be reasonably estimated, the Company will record a liability. CALIFORNIA: Los Angeles To Settle Lawsuit Over Homeless Sweeps -------------------------------------------------------------- The City of Los Angeles, California reached an agreement for the lawsuit filed on behalf of 58 people who were improperly arrested in November as part of law enforcement sweeps of downtown's skid row, NBCTV4 reports. The suit was commenced after city authorities conducted a joint sweep of the city in November, arresting more than 200 people on streets and in hotels on skid row. The suit states 84 of the people arrested were taken in for alleged parole violations. The suit asserts that police had warrants for only 26 of the parolees and that there was no reason to detain the others, and that the police violated the people's constitutional rights. The Federal Court issued an injunction against the City in April after the lawsuit was filed. City officials told NBCTV4 that they have agreed to pay $75,000 in damages to the plaintiffs, who were either taken into custody or are other skid row residents who may have been caught up in similar sweeps. The money will be distributed according to a still-to-be determined formula based on time spent in jail and any other losses. The officials also said they would stop from rounding up low-income and homeless people unless there is a reasonable suspicion that they have committed a crime. "I hope it makes a difference," attorney Carol Sobel, who joined the American Civil Liberties Union in bringing the suit told NBCTV4. "The police retain the right to question and do consensual stuff on skid row, but the presence of police in an area where people are poor and homeless limits their consent to a great degree." The court must still approve the terms of the settlement, which could be amended pending legal challenges to a separate federal suit over parolee searches. CANADA: Quebec Court Upholds Settlement of Suit V. Royal Trust -------------------------------------------------------------- Quebec Superior Court (Canada) Justice Claude Pellier upheld an earlier judgment of an Ontario Superior Court ruling by Mr. Justice Haines, approving the settlement of a class action against Royal Trust. The settlement will result in more than 8,500 pension plan members across Canada receiving an average settlement of $24,000 in cash and/or enhanced pensions, with those entitled receiving no less than $2,000 and some receiving substantially more than the average settlement. The judgments are based upon an agreement between the Association for Pension Enhancement at Royal Trust (APERT), acting on behalf of the pension plan members and the Royal Bank of Canada, the parent company of Royal Trust. The settlement is valued at approximately $50.9 million. "At issue was administration of the Royal Trust Pension Plan before and after Royal Trust was purchased by the Royal Bank of Canada in 1993," says Iain Sneddon, partner with Cohen Highley LLP and co-counsel for the class action. "This settlement will benefit Royal Trust families across the country." The suit originated in 1996 when several Royal Trust pension plan members retained Cohen Highley LLP to obtain a preliminary opinion on their entitlement to a substantial surplus in the plan. John Burleton, Chairman of APERT's Negotiating and Executive Committee, is delighted with the judgment and resulting benefits to members and their families. "Cohen Highley brought together the concerns of our members in collective and effective way. The APERT members' support of and participation in this class action to resolve these issues and find a solution has clearly paid dividends today." For more information, contact Iain Sneddon, Partner, Cohen Highley LLP, by Phone: (519) 636-4666 or (519) 672-9330 or visit the website: http://www.cohenhighley.comor by E-mail: lawyers@cohenhighley.com DAIMLERCHRYSLER AG: DE Court Certifies Securities Fraud Lawsuit --------------------------------------------------------------- Wilmington, Delaware Federal Judge Joseph J. Farnan granted class action certification to the multi-billion dollar securities suit filed against DaimlerChrysler AG, Dow Jones reports. The decision puts shareholders, led by billionaire investor Kirk Kerkorian, in a better position for a settlement, lawyers assert. The judge also excluded non-US Chrysler shareholders from the class action certification, adding that a December 1 trial date was set for the suit, which began in 2000. Dow Jones noted that the group of former Chrysler shareholders claims that DaimlerBenz AG and its Chief Executive, Juergen Schrempp, planned and executed a takeover of Chrysler in 1998, although the company called the deal a "merger of equals." Chrysler shareholders as a group would have received $5 billion to $10 billion more as a premium for giving up control to Daimler had the companies had a takeover agreement, they say, Dow Jones noted. Dow Jones said the suit began after a story in the Financial Times quoted Mr. Schrempp saying that he had always planned a takeover but that Chrysler would agree only to a merger. According to the news agency, Michael Schell, lawyer for DaimlerChrysler, on Thursday called the judge's certification of the class action "routine." The company believes the suit has no merit, he continued. The Company contends the transaction was a "merger of equals," and shareholders suffered no damages. Further, the suit came after a one-year statute of limitations expired on litigation related to the merger. Richard Bemporad, lawyer for an institutional investor, Glickenhaus & Co., told Dow Jones that his client and some other investors are pursuing separate suits because they also are seeking punitive damages for fraud. DELOITTE & TOUCHE: Firm To Delay Summons For LeisureNet Lawsuit --------------------------------------------------------------- Empowerment company Sekunjalo Investments will delay issuing summons in its planned class action against accounting firm Deloitte & Touche, over its role in the collapse of the LeisureNet group in 2000, iafrica.com reports. Sekunjalo previously said it would sue the firm for damages, on the grounds that Deloitte should have warned shareholders against investing in LeisureNet. "In preparing the papers, it has now become apparent that the basis on which Sekunjalo will sue Deloittes is possibly unique to Sekunjalo. This is because of the specific factual circumstances behind Sekunjalo"s investments in LeisureNet," the group said in a SENS announcement, iafrica.com reports. However its lawyers had not yet ruled out the class action. The group also urged Leisurenet's liquidators to pursue investigations overseas, "such as Malta, England and Germany", where Leisurenet's health arm Healthland operated. Sekunjalo said a development in that regard might well impact on the claim. DYNEGY INC.: Three Former Execs Charged With Conspiracy, Fraud -------------------------------------------------------------- Three former Dynegy, Inc. executives were charged in a federal indictment of conspiracy and fraud over their roles in accounting transactions that improperly boosted the energy company's cash flow and lowered its taxes, the Associated Press reports. The three officers also face a civil lawsuit filed by the United States Securities and Exchange Commission. The three officers were: (1) Jamie Olis, 37, former senior director of tax planning, (2) Gene Shannon Foster, 44, former vice president of tax, and (3) Helen Christine Sharkey, 31, a former member of the Company's risk control and deal structure group The suit charges them with conspiracy, securities fraud, mail fraud and wire fraud. The defendants are scheduled to appear before a federal magistrate this week. "These defendants are accused of withholding the truth about Dynegy's true fiscal condition from the SEC, shareholders and the public," US Attorney Michael Shelby told AP. The Company agreed to pay $3 million to the SEC last September to settle its probe of a natural gas deal called Project Alpha which allegedly improperly boosted the company's cash flow. The government alleges the defendants had a role in the deal. EXXON MOBIL: Appeals Court Upholds $1.2B Award in Fraud Lawsuit --------------------------------------------------------------- Exxon Mobil Corporation was ordered to pay $1.2 billion to its service station operators, as the United States Appeals court affirmed a jury verdict in a class action filed against it, Reuters reports. The jury had found the Company guilty of overcharging the operators for motor fuel and trying to conceal it. The class action suit was filed on behalf of about 10,000 current or former Exxon dealers who operated a service station between March 1, 1983 and August 28, 1994. GROUP HEALTH: Class in Lawsuit Given One Week To Submit Claims -------------------------------------------------------------- Thousands of class members in a class action against Group Health Cooperative have one week left to submit claims to obtain reimbursement for alternative health care, according to Sirianni Youtz Meier & Spoonemore. The deadline for submitting claims is June 19, 2003. The opportunity to be reimbursed for care provided by naturopaths, acupuncturists and massage therapists is the result of a settlement earlier this year in a class action filed against the Company. Tens of thousands of current and former members of Group Health Cooperative, Group Health Options and Group Health Northwest are eligible for reimbursement of what will add up to millions of dollars in fees they paid for alternative medical services. To obtain reimbursement, people who were insured with Group Health between June 1996 and December 2002 must complete a claim form and mail it to Group Health. There is no fee or charge for filing a claim. The settlement would reimburse eligible consumers for all of the money they spent out of pocket, except for a "co-pay" fee of $8.65 per visit that would be deducted from the reimbursement. The settlement was reached earlier this year after two class actions were filed in state and federal court against Group Health. Both lawsuits made similar allegations that Group Health illegally required members to exhaust "traditional" medical treatment and imposed strict requirements on physician referrals before they could receive treatment by naturopaths, acupuncturists or massage therapists. The lawsuit is based on Washington's 1996 "Every Category of Provider" law, which requires health care insurers to cover all forms of state- licensed, regulated health care on the same basis. In the settlement, Group Health denies that it violated the law. The settlement has been granted preliminary approval by both a state and federal court. Final approval will be sought from both courts next week. For more information, contact Jonathan Meier or Rick Spoonemore by Phone: 866-510-1792 by E-mail: altcarelaw@sylaw.com or visit the firm's Website: http://www.altcarelaw.com. LANTRONIX INC.: Plaintiffs File Consolidated Stock Lawsuit in CA ---------------------------------------------------------------- Plaintiffs in the securities class actions filed against Lantronix, Inc. (Nasdaq: LTRX) and other defendants filed a first consolidated amended complaint in the United States District Court for the Central District of California. The consolidated complaint contains new allegations, including allegations against defendants for the issuance of false statements in connection with Lantronix's initial public offering (IPO) on August 4, 2000 and its secondary public offering on July 17, 2001. The original suits were filed against the Company and certain of its current and former officers and directors alleging violations of the Securities Exchange Act of 1934, as amended. The suits, filed on behalf of persons who purchased or otherwise acquired the Company's common stock during the period of April 25, 2001 through May 30, 2002, inclusive, allege that the defendants caused the Company to improperly recognize revenue and made false and misleading statements about the Company's business. The suits further allege that that the Company materially overstated its reported financial results, thereby inflating the Company's stock price during its secondary Offering in July 2001, as well facilitating the use of the Company's stock as consideration in acquisitions. For more information, contact Elizabeth P. Lin of Weiss & Yourman - Los Angeles by Phone: (800) 437-7918 by E-mail: info@wyca.com or visit the firm's Website: http://www.wyca.com MBNA CORPORATION: Faces Lawsuit Over TWA Frequent Flyer Program --------------------------------------------------------------- The law firm of Weiss & Yourman is currently asking for information in connection with a pending class action against MBNA Corporation, MBNA America Bank, N.A. and American Airlines on behalf of consumers who applied for and received an MBNA/TWA Aviators Visa or MasterCard Credit Card. The consumers paid an enrollment and/or annual fee for the credit card and earned frequent flier TWA Aviator miles for every dollar they spent using the credit card, which miles could be used to fly on TWA and/or affiliated partners. However, TWA filed for bankruptcy in January 2001. American Airlines acquired TWA and publicly announced that it would definitely honor the TWA Aviator miles, promising to transfer and post the miles into American Airline's AAdvantage Program. The lawsuit alleges that consumers were promised by MBNA and American Airlines, but did not receive within a reasonable amount of time or at all, the frequent flier miles posted to the American Airline's AAdvantage Program. Moreover, the lawsuit alleges that MBNA has failed to provide a refund, on a pro rata basis, of the annual fees based on the unused portion of the Credit Card following termination of the MBNA/TWA Aviators Program on September 24, 2001. Following the lawsuit's filing, American Airlines admitted that it had not posted all the Aviator miles to the American Airlines AAdvantage Program, and that by the end of January 2003, it had finally credited consumers with all miles due. For more information, contact Zev B. Zysman by Phone: 800-437-7318 or visit the firm's Website: http://www.wyca.com OKLAHOMA: Pilcher, School District Join Tar Creek Superfund Suit ---------------------------------------------------------------- The city of Picher and the Picher-Cardin School District joined a class action filed in the United States District Court in Tulsa, Oklahoma against six mining companies who were associated with the Tar Creek Superfund Site, the Joplin Globe reports. The Tar Creek Site is a former lead mining field and has been targeted for federal lead clean up for many years. The suit wants the companies to pay for a relocation program for area residents. The suit is separate from those filed last year by eight Picher area families against the mining companies, through a Tulsa law firm. The suit also seeks damages equal to the amount of the loss of value of the plaintiffs' properties, plus attorney fees and cost. The suit further seeks an "independently supervised medical monitoring program" for all class members and the establishment of an "independently supervised relocation program that will ensure the residents of the contaminated properties will be provided support and financial assistance in relocating away from the contaminated areas." John Sparkman, a member of the Picher-Cardin Board of Education, told the Joplin Globe that the board voted at its last meeting to join the class action, in which the city already had filed its claim. A cleanup plan for the Tar Creek site being put forward by Rep. Brad Carson, D-Okla., includes a buyout of Picher and Cardin properties to move residents away from the mountains of chat, the flint-rock waste left after the lead and zinc ores were milled out, the Joplin Globe reports. Bob Walker, superintendent of Picher-Cardin schools, said at a meeting Wednesday that while his name appears on the suit on behalf of the school district and Board of Education, he does not see a buyout plan as the best way to serve the area's children. "We have students with very definite learning disabilities we feel are linked to high blood-lead levels," he told the Globe. "We also have a unique teaching staff who are completely familiar with these children's special needs, and have dealt with them and continue to find new ways to help them learn . If you take these kids and scatter them to the four winds, then they're not going to find the same educational environment in other districts, and their educational progress will suffer for that." The class action also names as plaintiffs Picher Mayor Sam Freeman, and residents Betty Jean Cole, John Frazier, Patsy Huffman, Edwin Kerley, Patricia Kerley, Larry Olds, H.C. Baughman, Rayma Grimes and Susie Stone. The suit names as defendants: (1) ASARCO Inc., (2) Blue Tee Corporation, (3) Goldfields Mining Corporation, (4) NL Industries Inc., (5) Childress Royalty Co. and (6) Doe Run Corporation The mining companies have 30 days in which to file an initial response to the suit. Responses they have filed in the previous individual suits claim no liability for lead contamination because state-of-the-art mining techniques were used, and the hazards were not known or recognized at the time. SCHWEGMANN GIANT: LA Appeals Court Upholds $5.4M Award ------------------------------------------------------ New Orleans appeals court ordered former supermarket magnate John Schwegmann of Schwegmann Giant Super Markets to pay US$5.4M to retirees of his grocery chain over food vouchers that were promised before the company was sold and eventually went out of business, the Associated Press reports. 200 retired employees of the Company filed the suit in 1997, also naming as defendants the Company, a Schwegmann family trust, and insurer United States Fidelity & Guaranty Co. (USF&G), which underwrote insurance for retirement benefits. The United States Fifth Circuit Court of Appeals upheld a lower court ruling awarding the plaintiffs $5.4 million. However, it essentially cleared USF&G of liability. Thus Mr. Schwegmann and the other defendants are now responsible for the whole amount. However, Mr. Schwegmann's attorney John Gegenheimer, said his client does not have the assets to pay. Mr. Gegenheimer said his client will request a rehearing by the appeals court and will consider appealing the case to the US Supreme Court if the judgment stands. "Unfortunately for Mr. Schwegmann, he is stuck with everything," Metairie attorney Howard Kaplan, who represented USF&G in the case, told AP. Starting in 1985, retiring employees, 60 or older, and who had worked for the Company for twenty years were promised $216 in food vouchers each month until death. Most of these employees worked without the benefit of a retirement plan during much of their careers. The Schwegmann chain slid into financial problems in the mid- 1990s because of an ill-timed expansion plan and increased competition. The chain was sold to Kohlberg & Co. in 1997, placed in bankruptcy in 1999 and eventually sold off in pieces, AP reports. THQ INC.: CA Court Grants Approval to Fraud Suit Settlement ----------------------------------------------------------- The United States District Court for the Central District of California granted preliminary approval to the settlement of a securities class action filed against THQ Inc. and certain of its officers and directors. The suit alleges that defendants violated Rule 10b-5 and Section 20(a) of the Securities Exchange Act of 1934, including allegations that defendants: (1) manipulated the Company's stock price; (2) distributed false and misleading information concerning revenue recognition, forecasts and earnings estimates; (3) selectively disclosed material information; and (4) engaged in insider trading. The Company entered into a settlement agreement with the plaintiffs. While it continues to deny plaintiffs' allegations, the Company agreed to pay $10.2 million under the terms of the settlement agreement to resolve all claims by plaintiffs against all defendants. A hearing to consider final approval is currently scheduled for June 30, 2003. UNITED STATES: Representatives Pass Class Action Fairness Act ------------------------------------------------------------- The United States House of Representatives passed the Class Action Fairness Act of 2003 (H.R. 1115) sponsored by Rep. Bob Goodlatte, R-Va., by a vote of 253 to 170, PropertyandCasualty.com reports. The bill allows for the removal of certain interstate class actions to federal court from state court if requested by either plaintiffs or defendants in lawsuits where there is at least $5 million in controversy and the class members meet certain set requirements. The legislation also sets forth a consumer class action bill of rights that would include provisions for judicial review of non-cash settlements, protection against loss by class members, and clearer settlement information. The National Association of Mutual Insurance Companies (NAMIC) praised the passage of the bill. "This bill directly and effectively addresses the issue of abusive class action lawsuits," said Monte Ward, NAMIC's federal affairs vice president, according to PropertyandCasualty.com. "NAMIC believes that Congress must pass this legislation to stop the current class action crisis and put interstate class actions in federal court where they are more appropriate." "The bi-partisan Class Action Fairness Act is a narrowly- tailored bill that allows large interstate class actions to more easily be heard in federal court rather than forcing them to remain in state courts selected through `forum shopping' by trial lawyers," Mr. Ward continued. In the Senate, a companion class action reform bill, S. 274, was favorably reported out of the Senate Judiciary Committee by a 12-7 margin in early April. The Senate is expected to take up the bill sometime this summer. WASHINGTON DC: Court Rules in City's Favor in Red Light Lawsuit --------------------------------------------------------------- Washington DC Superior Court ruled in favor of the city, saying that it did not violate the Constitution by imposing fines on car owners caught on camera speeding down streets or running red lights, the Washington Post reports. The suit was filed on behalf of owners of vehicles caught by red light and photo radar traffic cameras, but who were not driving them at the time, an earlier Class Action Reporter story states. The cameras register vehicles that run red lights or exceed the speed limit. The plaintiffs are a Howard University student, who owed more than $1,500 in speeding tickets, and a District of Columbia cab leasing company, Auto Ward Inc., whose owner Muhammad Seleem estimated he owed $18,000 in fines. The lawsuit charges that the city's automatic traffic enforcement system violates the defendants' rights to due process because it ultimately holds the vehicle owner responsible, rather than the driver. In a 14-page decision delivered in court yesterday, Judge Melvin R. Wright rejected the attorneys' assertions and threw out the lawsuit. He said the city can presume the owner of the car to be guilty, as long as the owner is given ample opportunity to rebut the charge. "The statute as passed has in essence removed all criminal penalties for its violation and instead has imposed the equivalent of a civil fine," Judge Wright wrote, the Post reports. "No points are (assessed) nor can any person be imprisoned or have his/her license or registration revoked . for failure to pay the fine." The plaintiffs' attorneys questioned the decision. "We're not going to stop," Mr. Bradshaw said. "This fight isn't over. We've gone this far with it, and the citizens want us to keep going." What was most frustrating, they said, was the judge's unwillingness to let the case have its day. "The judge is not going to give the people a hearing in court," Mr. Bradshaw told the Post. "He is not giving the argument a chance to be heard. It is possible the case will be forwarded to the D.C. Court of Appeals, is one possibility, the attorneys said. They might also consider going to the D.C. Council, with the backing of motorists who have been snared by the cameras, and pushing for a change in the law is another, the Post states. Kevin P. Morison, a spokesman for the D.C. police, applauded the decision, saying "I think it's a really good day for the law- abiding motorist, the pedestrians, the bicyclists, anyone who uses the streets of the District of Columbia." The numbers bear out the cameras' positive effects, Mr. Morison told the Post. Last year, 50 people were killed in traffic fatalities in the District, down from 71 in 2001. So far this year, 25 people have died in traffic fatalities, down from 28 at this point last year. WORLDCOM INC.: Judge Considers Stock Award, Along with $5M Pact --------------------------------------------------------------- Federal Judge Jed S. Rakoff is considering whether WorldCom Inc. shareholders would benefit from getting stock in the reorganized company, along with cash from a $500 million settlement the company and regulators hope he will approve, the Associated Press reports. Lawyers for both the Company and the Securities and Exchange Commission presented their arguments before Judge Rakoff, seeking for the settlement of fraud charges to be approved. Judge Rakoff said he has received dozens of letters from interest groups and individual shareholders who believe the fine should be far stiffer because WorldCom fraud's wiped out as much as $200 billion in shareholder value, AP reports. He said he was intrigued by a proposal made by some former WorldCom shareholders that they be compensated for their huge losses by receiving shares of the new company when WorldCom emerges from bankruptcy. He ordered lawyers for SEC and WorldCom to examine the idea. "It is heartbreaking to learn of the way in which these frauds blew away the limited retirement funds of working people who had put their money in a communications company because it seemed like such a safe thing to do," he said, AP reports. SEC lawyer Peter Bresnan told AP cash payments were probably more appropriate. "There may be some WorldCom shareholders who would not be particularly enamored to get stock in the new company," he said. "They may be very happy to leave their experience as WorldCom shareholders behind them." New Securities Fraud Cases BARRICK GOLD: Cauley Geller Lodges Securities Fraud Suit in NY -------------------------------------------------------------- Cauley Geller Bowman & Rudman, LLP initiated a securities class action in the United States District Court for the Southern District of New York on behalf of purchasers of Barrick Gold Corporation (NYSE: ABX) publicly traded securities during the period between February 14, 2002 and September 26, 2002, inclusive. The suit names as defendants the Company and: (1) Randall Oliphant (CEO and President until February 12, 2003), (2) John K. Carrington (COO and Vice Chairman) and (3) Jamie C. Sokalsky (CFO) The suit alleges violations of 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 14, 2002 and September 26, 2002. For example, throughout the class period, Barrick assured the markets that it was improving its operations by keeping its production costs in check and that the Company expected to earn $0.42-$0.47 per share in 2002, even taking into account the phasing out of several mines and decreasing ore quality (which increases costs) in several of its mines. These representations were materially false and misleading, according to the complaint, because they failed to disclose that the Company's expected costs for the year would be well above the figures highlighted to the public, that Barrick's costs per ounce had increased dramatically in 2002 and would continue to increase throughout the year, and that the Company's repeated assurances that production and costs would continue to improve in 2002 were lacking in any reasonable basis and were contradicted by facts known to defendants, or, at the very least, recklessly disregarded by them. On September 26, 2002, the Company announced that it expects to earn materially less in 2002 than previously announced, due to increased costs stemming from production issues at several mines (which, the Company misleadingly represented during the class period, would be resolved in the second half of 2002). In reaction to the announcement, which came only days after the Company reiterated its positive expectations, Barrick's stock fell by 10.5% in one day, from $17.77 on September 25, 2002 to $15.90 on September 26, on extremely heavy trading volume. For more details, contact Samuel H. Rudman, David A. Rosenfeld, Jackie Addison, Heather Gann or Candace Randle by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 by Fax: 1-501-312-8505 or by E-mail: info@cauleygeller.com BARRICK GOLD: Milberg Weiss Files Securities Suit in S.D. NY ------------------------------------------------------------ Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class action on behalf of purchasers of the securities of Barrick Gold Corporation (NYSE: ABX) between February 14, 2002 and September 26, 2002 inclusive, in the United States District Court for the Southern District of New York against the Company and: (1) Randall Oliphant (CEO and President until February 12, 2003), (2) John K. Carrington (COO and Vice Chairman) and (3) Jamie C. Sokalsky (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 14, 2002 and September 26, 2002. For example, throughout the class period, Barrick assured the markets that it was improving its operations by keeping its production costs in check and that the Company expected to earn $0.42-$0.47 per share in 2002, even taking into account the phasing out of several mines and decreasing ore quality (which increases costs) in several of its mines. These representations were materially false and misleading, according to the complaint, because they failed to disclose that the Company's expected costs for the year would be well above the figures highlighted to the public, that Barrick's costs per ounce had increased dramatically in 2002 and would continue to increase throughout the year, and that the Company's repeated assurances that production and costs would continue to improve in 2002 were lacking in any reasonable basis and were contradicted by facts known to defendants, or, at the very least, recklessly disregarded by them. On September 26, 2002, the Company announced that it expects to earn materially less in 2002 than previously announced, due to increased costs stemming from production issues at several mines (which, the Company misleadingly represented during the class period, would be resolved in the second half of 2002). In reaction to the announcement, which came only days after the Company reiterated its positive expectations, Barrick's stock fell by 10.5% in one day, from $17.77 on September 25, 2002 to $15.90 on September 26, on extremely heavy trading volume. 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: barrickcase@milbergNY.com or visit the firm's Website: http://www.milberg.com eUNIVERSE INC.: Abbey Gardy Commences Securities Suit in C.D. CA ---------------------------------------------------------------- Abbey Gardy, LLP initiated a securities class action on behalf of all persons who purchased securities of eUniverse, Inc. (NasdaqSC:EUNI) between July 30, 2002 and May 5, 2003 inclusive, in the United States District Court for the Central District of California. 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 during the class period thereby artificially inflating the price of eUniverse securities. The complaint alleges that eUniverse, issued false and misleading press releases and SEC filing concerning its publicly reported sales and earnings. In particular, the complaint alleges that defendants overstated the Company's revenues and net income for the second and third quarters, and possibly the first, of the Company's fiscal year ended March 31, 2003. For more details, contact Nancy Kaboolian by Phone: (212) 889-3700 or 800-889-3701 or by E-mail: nkaboolian@abbeygardy.com FEDERAL HOME: Wolf Haldenstein Lodges Securities Suit in E.D. VA ---------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP initiated a securities class action in the United States District Court for the Eastern District of Virginia, on behalf of all persons who purchased or otherwise acquired the securities of Federal Home Loan Mortgage Corporation (NYSE: FRE) between April 18, 2000 and June 6, 2003, inclusive, against Freddie Mac and certain officers of the Company. The complaint alleges that throughout the class period, defendants issued statements, press releases, and filed quarterly and annual reports with the SEC describing the Company's business operations and financial condition. These representations were materially false and misleading because they failed to disclose that throughout the class period, the Company had materially misstated its operating earnings. Specifically, during the relevant time period, it has been reported that Freddie Mac may have earned more than it reported and had a higher capital surplus. This practice, called "smoothing" allows companies to meet or exceed earnings estimates and report substantial growth going forward by deferring present gains to future periods. The effect of this practice is to create the impression that earnings growth is steady and the Company meets or exceeds analysts' expectations on a regular basis. This practice is also called "cookie jar" accounting and violates Generally Accepted Accounting Principles and the SEC has pledged to stop its practice among public companies. On June 9, 2003, before the market opened, Freddie Mac issued a press release announcing that it had fired defendant David Glenn because of "serious questions about the timeliness and completeness of his cooperation and candor with the board's audit committee counsel," that defendant Leland C. Brendsel had retired and that defendant Vaughn Clarke had resigned. On this news, shares of Freddie Mac, which had closed at $59.87 on June 6, 2003, fell to $52 in midday trading on June 9, 2003. Following these revelations, on June 11, 2003, numerous news sources reported that the US Attorney's office for Eastern Virginia confirmed that the office was investigating Freddie Mac and that the SEC was also investigating whether Freddie Mac deferred income to smooth out results in future periods. Moreover, the SEC is reportedly investigating whether Freddie Mac's CEO and CFO certified otherwise false financial statements in violation of Sarbanes-Oxley. The full scope and contours of defendants' concerted fraud continues to be revealed. For more details, contact Gred Taylor Isquith, Gregory Nespole, Michael Miske, Christopher Hinton, George Peters or Derek Behnke by Mail: 270 Madison Avenue, New York, New York 10016, by Phone: (800) 575-0735 by E-mail at classmember@whafh.com or visit the firm's Website: http://www.whafh.com. All e-mail correspondence should make reference to Freddie Mac. GOLDMAN SACHS: Pomerantz Haudek Files Securities Suit in S.D. NY ---------------------------------------------------------------- Pomerantz Haudek Block Grossman & Gross LLP and Vianale & Vianale initiated a securities class action in the United States District Court for the Southern District of New York against Goldman Sachs & Co. (NYSE:GS) on behalf of investors who purchased the common stock of Exodus Communications, Inc. pursuant or traceable to a Registration Statement/Prospectus filed with the Securities and Exchange Commission (SEC) on June 28, 2000, as amended on July 18, 2000, declared effective on July 20, 2000 and supplemented on February 5, 2001. The lawsuit charges that Goldman Sachs, a joint book-running manager of the Offering, violated Sections 11 and 12(a)(2) of the Securities Act of 1933. On February 6, 2001, the Company completed a public offering of 13,000,000 shares of its common stock at $18.50 per share for proceeds of $240,500,000. However, it is alleged that the Registration Statement was false and misleading because it overstated net income for at least the nine months ended September 30, 2000 and failed to disclose that the Company was improperly capitalizing expenses. On September 26, 2001, Exodus filed for bankruptcy protection under Chapter 11 of the US Bankruptcy Code. All of the outstanding shares of common stock of Exodus were cancelled and ceased to be outstanding as of June 19, 2002, the effective date of the plan of reorganization. For more details, contact Andrew G. Tolan by Phone: (888) 476-6529 / (888) 4-POMLAW or by E-mail: agtolan@pomlaw.com MERRILL LYNCH: Berger& Montague Files Securities Suit in S.D. NY ---------------------------------------------------------------- Berger & Montague, PC initiated a securities class action against Merrill Lynch Pierce Fenner & Smith Incorporated and its former analyst Phua Young, on behalf of persons who purchased securities of Tyco International Ltd. (NYSE: TYC) between February 14, 2002 through June 6, 2002, inclusive. The suit was filed in the United States District Court for the Southern District of New York. The complaint alleges that defendants engaged in a scheme to defraud Tyco investors in violation of SEC Rule 10b-5 by issuing numerous misleading research reports on Tyco during the class period. More specifically, Mr. Young expressed very positive opinions in his research reports on Tyco that were entirely inconsistent with his own private views which he expressed in internal emails. Indeed, Mr. Young's internal emails show that he did not believe his own publicly-issued research reports concluding that Tyco's subsidiary, CIT Group, could be sold for as high as $7-8 billion. Mr. Young privately expressed his true view that CIT would sell at far less, which it did. As a result of issuing false research reports and engaging in other wrongdoing, the NASD recently filed a disciplinary proceeding against Mr. Young, charging him with numerous violations of NASD Rules of Conduct. For more details, contact Todd S. Collins, Michael T. Fantini or Kimberly A. Walker by Mail: Berger & Montague, P.C., 1622 Locust Street, Philadelphia, PA 19103 by Phone: 888-891-2289 or 215-875-3000 by Fax: 215-875-5715 by E-mail: InvestorProtect@bm.net or visit the firm's Website: http://www.bergermontague.com ORTHODONTIC CENTERS: Marc Henzel Lodges Securities Lawsuit in LA ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Eastern District of Louisiana on behalf of purchasers of the securities of Orthodontic Centers of America, Inc. (NYSE: OCA) between November 14, 2002 and March 18, 2003 inclusive. The suit names as defendants the Company and: (1) Bartholomew Palmisano, Sr. (President and CEO), (2) Bartholomew Palmisano, Jr. (COO) and (3) Thomas Sandeman (CFO) 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 materially false and misleading statements to the market between November 14, 2002 and March 18, 2003. Specifically, the complaint alleges that OCA was at all relevant times a provider of integrated business services to orthodontic and pediatric dental practices. In May 2001, OCA announced that it had entered into a definitive merger agreement whereby a wholly owned subsidiary of OCA would merge into OrthAlliance in a stock-for-stock transaction, with OrthAlliance becoming a wholly owned subsidiary of OCA. Following the May 2001 announcement, a number of OrthAlliance's affiliated practices filed lawsuits against OrthAlliance and/or notified OrthAlliance that it was in default under their service, management service, and consulting agreements and that these practices had stopped paying their service fees. At all relevant times, the Company stated that it had anticipated such lawsuits and that the integration of OrthAlliance and OCA was not only going as planned but also "very very well." The complaint further alleges that the statements disseminated by defendants during the class period and with respect to the financial well-being of the Company were each materially false and misleading because: (1) the integration of OrthAlliance practices was not going "very very well" but on the contrary, it was going very poorly and, consequently, the Company's actual revenue and earnings were decreasing; (2) not only had some OrthAlliance practices sued but other OrthAlliance practices had discontinued paying their services fees; (3) the Company continued to recognize revenue from OrthAlliance practices that were in litigation and from those that had stopped paying their service fees and was thereby violating Generally Accepted Accounting Principles (GAAP); and (4) the defendants were actively concealing these facts in order to manipulate the Company's earnings outlook and thereby maintain its favorable stock prices. The Complaint further alleges that on March 18, 2003 the Company announced its financial results for the fourth quarter ended December 31, 2002. The Company reported fourth quarter earnings of $0.17 per share, compared to fourth quarter 2001 earnings of $0.34 per share, on fee revenue of $102.1 million compared to fourth quarter fee 2001 revenue of $104.4 million. The Company attributed the decline in revenue and earnings to "26 OrthAlliance affiliated practices that paid service fees in the fourth quarter of 2001 and stopped paying service fees during the third and fourth quarters of 2002." On this news, OCA's share price dropped 41% from a closing price of $9.57 on March 18, 2003 to a closing price of $5.64 on March 19, 2003. 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 or by E-Mail: mhenzel182@aol.com ORTHODONTIC CENTERS: Schatz & Nobel Lodges Securities Suit in LA ---------------------------------------------------------------- Schatz & Nobel PC initiated a securities class action in the United States District Court for the Eastern District of Louisiana on behalf of all persons who purchased the securities of Orthodontic Centers of America, Inc. (NYSE: OCA) from November 14, 2002 through March 18, 2003, inclusive. The complaint alleges that OCA and certain of its officers and directors issued materially false and misleading statements concerning the Company's business condition. Specifically, on May 17, 2001, OCA and OrthAlliance announced that the parties had "entered into a definitive merger agreement, whereby a wholly-owned subsidiary of OCA would merge into OrthAlliance in a stock for stock transaction, with OrthAlliance becoming a wholly-owned subsidiary of OCA." Following the May 17 2001, announcement, a number of OrthAlliance's affiliated practices filed lawsuits against OrthAlliance and/or notified OrthAlliance that it was in default under their service, management service and consulting agreements. Throughout the class period, OCA concealed these facts and maintained that the merger was a positive development for the Company. Following the close of the markets on March 18, 2003, OCA issued a press release announcing its year end earnings for 2002 wherein the Company reported that earnings and fee revenue were down from the previous year. The decline in fee revenue resulted from numerous OrthAlliance affiliated practices that discontinued paying fees required under their service management, service and consulting agreements in 2002. For more details, contact Andrew M. Schatz or Nancy A. Kulesa by Phone: (800) 797-5499, by E-mail: sn06106@aol.com or visit the firm's Website: http://www.snlaw.net. PARADIGM MEDICAL: Marc Henzel Lodges Securities Lawsuit in Utah --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Utah on behalf of purchasers of Paradigm Medical Industries, Inc. (NasdaqSC: PMED) publicly traded securities during the period from April 25, 2001 through May 14, 2003, inclusive. The complaint charges that Paradigm and certain of its current and former officers and directors violated Section 10b of the Securities Exchange Act of 1934 by issuing a series of materially false and misleading statements to the market beginning on April 25, 2001 and continuing through December 2002. Paradigm develops and sells laser surgical systems, including the Ocular Blood Flow Analyzer (BFA). The complaint alleges that Paradigm misrepresented in its Securities & Exchange Commission (SEC) filings and in press releases that it had received authorization from the American Medical Association for a Common Procedure Terminology code facilitating insurance reimbursement to doctors for performing medical procedures with the BFA. Additionally, the complaint alleges that the Company misrepresented in a press release that it had received a $105 million purchase order, when no such purchase order existed. As a result of these misrepresentations, according to the complaint, the price of PMED securities was artificially inflated during the class period. 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 or by E-Mail: mhenzel182@aol.com REGENERON PHARMACEUTICALS: Marc Henzel Files Stock Lawsuit in NY ---------------------------------------------------------------- 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 securities of Regeneron Pharmaceuticals, Inc. (Nasdaq: REGN) between March 28, 2000 and March 30, 2003, inclusive, (the "Class Period"), and who suffered damages thereby. The action, is pending against the Company and: (1) Leonard S. Schleifer (President and CEO), (2) George D. Yancopoulos (Chief Scientific Officer), (3) Hans-Peter Guler (VP of Clinical Studies), (4) Neil Stahl (VP) and (5) Murray A. Goldberg (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 March 28, 2000 and March 30, 2003. Regeneron is a biopharmaceutical company that discovers, develops and intends to commercialize therapeutic drugs for the treatment of serious medical conditions. During the class period, Regeneron initiated Phase II clinical trials for its diet drug AXOKINE for use in obese patients. The complaint alleges that the defendants claimed that AXOKINE would help patients lose weight better than a placebo over a year. However, more than two-thirds of the 1,467 patients on the medicine in the clinical trials developed antibodies to it after three months, which made the medicine less effective. Patients taking AXOKINE, including those who developed antibodies, lost an average 6.2 pounds, compared with 2.6 pounds for those on a placebo, which the Company admits is similar to results dieters get with already available pills. Before results were released, defendants had led the public to believe that AXOKINE would have more than $500 million in annual sales. On March 31, 2003, Regeneron admitted AXOKINE lost effectiveness in about 70% of patients in a study. On this news, the biotechnology company's shares plunged 57%, a market cap loss of more than $500 million. However, even defendants' admission was false, as, in fact, defendants manipulated the results of the study. In truth, 73.5% of the patients developed antibodies to the drug. As a result of the defendants' false statements, Regeneron's stock price traded at inflated levels during the Class Period, increasing to as high as $40 on December 18, 2000, whereby the Company and its top officers and directors sold more than $430 million worth of their own 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 or by E-Mail: mhenzel182@aol.com SARA LEE: Marc Henzel Commences Securities Fraud Suit 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 Illinois on behalf of purchasers of Sara Lee Corporation (NYSE: SLE) publicly traded securities during the period between August 1, 2002 to April 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 August 1, 2002 and April 24, 2003, thereby artificially inflating the price of Sara Lee securities. The complaint also alleges that defendants issued a series of materially false and misleading statements concerning the Company's operations and prospects. In particular, the complaint alleges that the statements were materially false and misleading because they failed to disclose: (1) that, despite the Company Reshaping program, the Company was still burdened with numerous poorly performing businesses and would have to reevaluate its various businesses. Accordingly, Sara Lee did not have "the right mix of businesses" in that several material businesses were "not growing" or were "in significant decline;" (2) that the Company's underperforming businesses were causing the Company to experience declining results and, as a result, the Company would not be growing at the rates represented to the market; (3) due to a lack of proper internal or financial controls, Sara Lee failed to identify or recognize those businesses or brands among its portfolio of companies that would need to be "run dramatically differently in the future;" and (4) based on the foregoing, Sara Lee lacked any reasonable basis upon which to project it would experience "double-digit operating income increase" for fiscal 2003 among its "five lines of business" or have diluted EPS for fiscal 2003 in the range of $1.54 to $1.60. On April 24, 2003, Sara Lee shocked the public when it issued a press release announcing its financial results for the third quarter, the period ending March 31, 2003. The Company announced that it was reducing earnings for fiscal 2003 to $1.50 to $1.52 per share, significantly below consensus expectations of $1.59. In response to this announcement, the price of Sara Lee common stock dropped by 10%. During the class period, Sara Lee insiders sold more than $23 million of their personally-held Sara Lee common stock to the unsuspecting public. 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 or by E-Mail: mhenzel182@aol.com SUPERGEN INC.: Marc Henzel Lodges 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 purchasers of SuperGen Inc. (NASDAQ: SUPG) common stock during the period between April 18, 2000 and March 13, 2003. The complaint charges SuperGen and its chairman, president and chief executive officer with violations of the Securities Exchange Act of 1934. SuperGen is a pharmaceutical company dedicated to the development and commercialization of products intended to treat life-threatening diseases, particularly cancer and blood cell disorders, as well as other serious conditions such as obesity and diabetes. The complaint alleges that during the class period, one of the Company's leading drug candidates was Mitozytrex, a proprietary reformulation of the approved anticancer drug Mitomycin C, which is used primarily to treat gastric and pancreatic cancers. SuperGen's reformulation is based on technology designed to improve the handling characteristics and safety profile of mitomycin and other anticancer drugs by enhancing the drug's stability in solution form and "shielding" it at the injection site. SuperGen sold millions of shares and notes for $25 million in proceeds so as to provide it with ample monies to fund its operations. However, this all took place prior to revelations concerning the veracity of the Company's statements regarding Mitozytrex. The Federal Food, Drug and Cosmetic Act gives the FDA authority to disseminate information to the public regarding drugs and other products within the FDA's jurisdiction to address imminent health dangers or gross deception. To protect the public health due to the improper statements by the Company, the FDA notified the public that SuperGen's product, Mitozytrex, has not been found by the agency to have benefits that the Company claimed. The truth, actually known by each defendant: (1) That Mitozytrex caused adverse reactions such as fever, anorexia, nausea and vomiting, together with myelosuppression and hemolytic uremic syndrome; (2) That Mitozytrex was merely a bioequivalent to the innovator mitomycin. It differed from the innovator formulation only in that the Company's product contained hydroxypropyl-beta-cyclodextrin (HPCD). No evidence exists to support the Company's claims that Mitoyztrex is superior to the existing formulations of mitomycin; (3) That there is no existing evidence that the addition of HPCD yields any clinical advantage over the original formulation of mitomycin; (4) That SuperGen's "Extra" technology did not shield the drug at the injection site; and (5) That the so-called "advantages" of the Company's product, including increased solubility, stability and shelf-life, were non-existent. 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 or by E-Mail: mhenzel182@aol.com ULTIMATE ELECTRONICS: Marc Henzel Lodges Securities Suit in CO -------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Colorado, on behalf of purchasers of Ultimate Electronics, Inc. (Nasdaq: ULTE) publicly traded securities during the period between March 13, 2002 and August 8, 2002, inclusive. The complaint charges that during the class period, the defendants issued and/or failed to correct false and misleading financial statements and press releases concerning the Company's publicly reported revenues and earnings directed to the investing public. Throughout the class period, the Company maintained that it could offset any reduction in margins incurred as a result of this transition through continued sales of high margin items, including direct broadcast satellite (DBS) service and systems and audio equipment. Yet, in part to enjoy a large economic windfall as a result of its class period offering of Ultimate stock, the Company failed to disclose that high margin sales were decreasing rapidly and with it, a critical stabilizer to the Company's bottom line. On August 8, 2002 the Company finally disclosed that because of the reduction in high margin sales, the Company would miss its second quarter earnings EPS outlook by almost 50%. 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 or by E-Mail: mhenzel182@aol.com UNUMPROVIDENT CORPORATION: Marc Henzel Files TN Securities Suit --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Eastern District of Tennessee on behalf of purchasers of UnumProvident Corporation (NYSE: UNM) publicly traded securities during the period between May 7, 2001 and February 4, 2003. The complaint charges UnumProvident and certain of its officers and directors with violations of the Securities Exchange Act of 1934. UnumProvident provides group disability and special risk insurance, as well as group life insurance, long-term care insurance, and payroll-deducted voluntary benefits offered to employees at their worksites. UnumProvident operates around the World. The complaint alleges that during the class period, defendants caused UnumProvident's shares to trade at artificially inflated levels through the issuance of false and misleading financial statements. The Company failed to properly record the impairment to its investments and operated "long-term denial factories," causing the Company's financial results to be inflated. As a result, the Company's shares traded at inflated prices enabling UnumProvident to raise proceeds of $250 million on June 13, 2002 in its bond offering. UnumProvident and its top officers inflated the prices of the Company's securities in order to pursue an accelerated securities sale program. Defendants knew that by concealing UnumProvident's true financial results they could foster the perception in the business community that UnumProvident was a "growth company," i.e., it was the only way UnumProvident could post the revenue and earnings per share growth claimed by defendants. On February 5, 2003, UnumProvident announced that it had recorded investment losses of $93 million and also reported that it was responding to Securities and Exchange Commission requests for information relating to its investment disclosures. 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 or by E-Mail: mhenzel182@aol.com ********* A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the Class Action Reporter. Submissions via e-mail to carconf@beard.com are encouraged. Each Friday's edition of the CAR includes a section featuring news on asbestos-related litigation and profiles of target asbestos defendants that, according to independent researches, collectively face billions of dollars in asbestos-related liabilities. The Asbestos Defendant Profiles is backed by an online database created to respond to custom searches. 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