/raid1/www/Hosts/bankrupt/CAR_Public/040213.mbx
C L A S S A C T I O N R E P O R T E R
Friday, February 13, 2004, Vol. 6, No. 31
Headlines
ALLIANCE SEMICONDUCTOR: Tower Investors Launch Securities Suit
APPLE COMPUTER: Plaintiffs Appeal CA Securities Suit Dismissal
APPLE COMPUTER: Administering Mac OS Consumer Lawsuit Settlement
APPLE COMPUTER: Consumers File Antitrust Suit Over Mail Rebates
APPLE COMPUTER: Opposes Consolidation of Suits in San Mateo, CA
APPLE COMPUTER: Faces Consumer Fraud Suit Over Hard Drives in CA
APPLE COMPUTER: CA Court Dismisses Class Action Claims in Suit
APPLE COMPUTER: Plaintiffs Appeal CA Securities Suit Dismissal
APPLE COMPUTER: Consumers Launch Suit Over Defective Powerbooks
CENTRAL GARDEN: Reaches Settlement for Injury Suit For 2000 Fire
CORINTHIAN COLLEGES: Teachers Launch Overtime Wage Lawsuit in CA
DANE FABER: SEC Upholds Disciplinary Action Over Trading Fraud
IDT CORPORATION: Parties Seeking Mediator To Reach Settlement
IDT CORPORATION: PA Court Transfers Consumer Fraud Suit To FCC
IDT CORPORATION: NY Court Still To Decide on Suit Certification
IDT CORPORATION: FL Court Yet To Rule in Lawsuit Certification
IDT CORPORATION: Discovery Proceeds in NJ Consumer Fraud Lawsuit
IDT CORPORATION: Faces Consumer Suit Over Long Distance Service
LUCENT TECHNOLOGIES: Continues Implementing NJ Suit Settlement
LUCENT TECHNOLOGIES: Faces Consumer Fraud Suits in WV, NY, CA
MARTHA STEWART: NY Court Refuses To Declare Mistrial in Lawsuit
MUTUAL FUNDS: SEC Proposing Ban on Trading Incentives, Practices
NEW ENGLAND: Reaches Settlement For Unsolicited Fax Suit in SC
OFFERING FRAUDS: SEC Commences Emergency Enforcement Lawsuit
OPLINK COMMUNICATIONS: Reaches Settlement For NY Securities Suit
PARAGON CONSTRUCTION: Ex-Execs Settle SEC Complaint over Fraud
POLO RALPH: Discovery in Wardrobing Suit To Resume In May 2004
STANDARD COMMERCIAL: Paid Its Share in NC Tobacco Merchants Suit
WINN DIXIE: Faces Lawsuit For Securities Violations in M.D. FL
Asbestos Alert
ASBESTOS LITIGATION: Widow Says Asbestos Exposure Cases on Rise
ASBESTOS LITIGATION: EPA Slashes Down Asbestos Workers' Wages
ASBESTOS LITIGATION: CONSOL Unit Battles 22,600 Asbestos Claims
ASBESTOS LITIGATION: Crown Holdings Increases Asbestos Reserves
ASBESTOS LITIGATION: USG Corporation to Re-Emerge from Chap. 11
ASBESTOS LITIGATION: UTC Sees Increase in Asbestos-Related Suits
ASBESTOS LITIGATION: Widow To Sue Cape plc for Asbestos Disease
ASBESTOS LITIGATION: Eastman Chem Settles Most Asbestos Claims
ASBESTOS LITIGATION: Judge Won't Block Halliburton Asbestos Deal
ASBESTOS LITIGATION: Hercules Boosts Reserves, Profit Falls
ASBESTOS LITIGATION: Widow's Asbestos Suit Includes 28 Companies
ASBESTOS ALERT: Boiler Cleaner's Death Deemed Asbestos-Related
New Securities Fraud Cases
AGCO CORPORATION: Federman & Sherwood Files Stock Lawsuit in IL
DATATEC SYSTEMS: Federman & Sherwood Lodges NJ Securities Suit
FRANKLIN RESOURCES: Federman & Sherwood Lodges Stock Suit in NV
FRANKLIN RESOURCES: Cauley Geller Launches Securities Suit in AZ
HOLLINGER INTERNATIONAL: Federman & Sherwood File IL Stock Suit
IBIS TECHNOLOGY: Wolf Haldenstein Lodges Securities Suit in MA
MOBILITY ELECTRONICS: Charles Piven Files Securities Suit in AZ
MOBILITY ELECTRONICS: Brian Felgoise Files Securities Suit in AZ
REDBACK NETWORKS: Bernstein Liebhard Files Securities Suit in CA
WAVE SYSTEMS: Federman & Sherwood Launches Securities Suit in NJ
WINN-DIXIE STORES: Rabin Murray Lodges Securities Lawsuit in FL
*********
ALLIANCE SEMICONDUCTOR: Tower Investors Launch Securities Suit
--------------------------------------------------------------
Alliance Semiconductor Corporation faces a securities class
action filed in the United States District Court for the
Southern District of New York. The suit also names as
defendants Tower Semiconductor Ltd., certain of Tower's
directors (including N. Damodar Reddy), and certain of Tower's
shareholders (including the Company).
The lawsuit alleges violations of Section 14(a) of the
Securities Exchange Act of 1934 and Rule 14a-9 promulgated
thereunder, and also alleges that certain defendants (including
N. Damodar Reddy and the Company) have liability under Section
20(a) of the Exchange Act. The lawsuit was brought by
plaintiffs on behalf of a putative class of persons who were
ordinary shareholders of Tower at the close of business on April
1, 2002, the record date for voting on certain matters proposed
in a proxy statement issued by Tower.
The Company has reviewed a copy of the complaint, believes it
has meritorious defenses to defend itself against the claims
asserted against it. Due to the early stage of the litigation,
the Company cannot determine what, if any, effect resolution of
this matter will have on its financial condition, the Company
stated in a Securities and Exchange Commission filing.
APPLE COMPUTER: Plaintiffs Appeal CA Securities Suit Dismissal
--------------------------------------------------------------
Plaintiffs appealed the United States District Court for the
Northern District of California's dismissal of a securities
class action filed against Apple Computer, Inc. and its Chief
Executive Officer.
The amended suit purports to bring suit on behalf of persons who
purchased the Company's publicly traded common stock between
July 19, 2000, and September 28, 2000. The complaint alleges
violations of the 1934 Securities Exchange Act and seek
unspecified compensatory damages and other relief.
The Company believes these claims are without merit. The
Company filed a motion to dismiss on June 4, 2002, which was
heard by the Court on September 13, 2002. On December 11, 2002,
the Court granted the Company's motion to dismiss for failure to
state a cause of action, with leave to Plaintiffs to amend their
complaint within thirty days.
Plaintiffs filed their amended complaint on January 31, 2003,
and the Company later filed a motion to dismiss the amended
complaint. The Court heard the Company's motion on July 11,
2003 and dismissed Plaintiff's claims with prejudice.
APPLE COMPUTER: Administering Mac OS Consumer Lawsuit Settlement
----------------------------------------------------------------
Apple Computer, Inc. is administering the settlement for the
consumer class action, styled "Bancroft v. Apple Computer,
Inc.," filed in the Los Angeles County Superior Court on behalf
of a potentially nationwide class of purchasers of certain Power
Macintosh G3 computers.
Plaintiff alleged violation of the Consumer Legal Remedies Act
(CLRA) arising from allegedly poor performance while running the
Company's Mac OS X operating system, specifically relating to 2D
hardware acceleration, QuickTime movie hardware acceleration, 3D
graphics performance and DVD movie playback.
The parties reached a settlement and the Court granted
preliminary approval on September 2, 2003 and final approval on
January 26, 2004. Settlement of the matter will not have a
material effect on the Company's financial position or results
of operations, the Company asserted in a disclosure to the
Securities and Exchange Commission.
APPLE COMPUTER: Consumers File Antitrust Suit Over Mail Rebates
---------------------------------------------------------------
Apple Computer, Inc. faces a class action, styled "Cagney v.
Apple Computer, Inc.," filed in Los Angeles County Superior
Court in California alleging improper collection of sales tax in
transactions involving mail-in rebates. The complaint alleges
violations of California Civil Code Section 17200 (unfair
competition) and seeks unspecified damages and other relief.
The Company was served on January 21, 2004 and is beginning its
investigation of these allegations, the Company revealed in a
filing with the Securities and Exchange Commission.
APPLE COMPUTER: Opposes Consolidation of Suits in San Mateo, CA
---------------------------------------------------------------
Apple Computer, Inc. opposed plaintiffs' proposal to consolidate
in the California Superior Court for San Mateo County five class
actions, styled:
(1) "Craft v. Apple Computer, Inc.," filed December 23,
2003 in the Santa Clara County Superior Court;
(2) "Chin v. Apple Computer, Inc.," filed filed December
23, 2003 in San Mateo County Superior Court;
(3) "Hughes v. Apple Computer, Inc.," filed December 23,
2003 in Santa Clara County Superior Court;
(4) "Westley v. Apple Computer, Inc.," filed December 26,
2003 in San Francisco County Superior Court;
(5) "Keegan v. Apple Computer, Inc.," filed December 30,
2003 in Alameda County Superior Court
The five suits alleged misrepresentations by the Company
relative to iPod battery life. The complaints include causes of
action for violation of California Civil Code Section 17200
(unfair competition), the Consumer Legal Remedies Action (CLRA)
and claims for false advertising, fraudulent concealment and
breach of warranty. The complaints seek unspecified damages and
other relief.
The Company is beginning its investigation of these claims. The
Company has opposed the motion on the grounds that Santa Clara
County would be the most appropriate venue for consolidation.
APPLE COMPUTER: Faces Consumer Fraud Suit Over Hard Drives in CA
----------------------------------------------------------------
Apple Computer, Inc. and other members of the computer industry
faced a class action, styled "Dan, et al. v. Apple Computer,
Inc.," filed in the Los Angeles County Superior Court,
California on behalf of a nationwide class of purchasers of
certain computer hard drives. The case alleges:
(1) violations of Civil Code Section 17200 (Unfair
Competition),
(2) violations of the Consumer Legal Remedies Act (CLRA)
and
(3) false advertising related to the size of the drives.
Plaintiffs allege that calculation of hard drive size using the
decimal method misrepresents the actual size of the drive. The
complaint seeks unspecified damages and other relief.
APPLE COMPUTER: CA Court Dismisses Class Action Claims in Suit
--------------------------------------------------------------
The San Francisco County Superior Court in California dismissed
the class action claims in a lawsuit filed against Apple
Computer, Inc., styled "Davis v. Apple Computer, Inc."
The suit alleges that the Company has engaged in unfair and
deceptive business practices relating to its AppleCare Extended
Service and Warranty Plan. Plaintiff asserts causes of action
for:
(1) violation of the California Business and Professions
Code 17200 and 17500,
(2) breach of the Song-Beverly Warranty Act,
(3) intentional misrepresentation and
(4) concealment
Plaintiff requests unspecified damages and other relief. The
Company filed a demurrer and motion to strike which were
granted, in part, and plaintiff filed an amended complaint. The
Company filed an answer on April 17, 2003 denying all
allegations and asserting numerous affirmative defenses.
Plaintiffs subsequently amended their complaint and the Company
expects that they will make further amendments.
On October 29, 2003, the Company filed a motion to disqualify
Plaintiff's counsel in his role as counsel to the purported
class and to the general public. The Court granted the motion,
but allowed Plaintiff to retain substitute counsel. Plaintiff
did engage new counsel for the general public, but not for the
class.
The Company moved to disqualify Plaintiff's new counsel and to
have the Court dismiss the general public claims for equitable
relief. The Court declined to disqualify Plaintiff's new
counsel or to dismiss the equitable claims, but did confirm that
the class action claims are dismissed. The trial date is stayed
pending a possible appeal.
APPLE COMPUTER: Plaintiffs Appeal CA Securities Suit Dismissal
--------------------------------------------------------------
Plaintiffs appealed the United States District Court for the
Northern District of California's dismissal of an amended
consolidated shareholder class action filed against Apple
Computer, Inc. and its chief executive officer Steven P. Jobs.
Three suits, styled "Hawaii Structural Iron Workers and
Pension Trust Fund v. Apple Computer, Inc. and Steven P. Jobs;
Young v. Apple Computer, Inc. et al; and Hsu v. Apple Computer
Inc. et al," were initially filed on behalf of persons who
purchased the Company's publicly traded common stock between
July 19, 2000, and September 28, 2000. The complaints allege
violations of the 1934 Securities Exchange Act and seek
unspecified compensatory damages and other relief.
The Company believes these claims are without merit. The
Company filed a motion to dismiss on June 4, 2002, which was
heard by the Court on September 13, 2002. On December 11, 2002,
the Court granted the Company's motion to dismiss for failure to
state a cause of action, with leave to Plaintiffs to amend their
complaint within thirty days. Plaintiffs filed their amended
complaint on January 31, 2003, and on March 17, 2003, the
Company filed a motion to dismiss the amended complaint. The
Court heard the Company's motion on July 11, 2003 and dismissed
Plaintiff's claims with prejudice.
APPLE COMPUTER: Consumers Launch Suit Over Defective Powerbooks
---------------------------------------------------------------
Apple Computer, Inc. faces a class action, styled "Palmieri v.
Apple Computer, Inc.," filed in the Los Angeles County Superior
Court in California on behalf of a nationwide class of
purchasers of certain PowerBooks.
The case alleges violations of Civil Code Section 17200 (Unfair
Competition) and the Consumer Legal Remedies Act (CLRA) arising
from an alleged design defect in the PowerBooks which
purportedly causes marks and dead pixels in the LCD screens.
Plaintiffs amended their complaint to allege an additional
defect in the new 15 PowerBook, introduced in September 2003,
which purportedly causes "white spots" on the screen. The
complaint seeks unspecified damages and other relief.
The Company filed an answer on January 8, 2004 denying all
allegations and asserting numerous affirmative defenses. The
Company is investigating these allegations, the Company revealed
in a filing with the Securities and Exchange Commission.
CENTRAL GARDEN: Reaches Settlement for Injury Suit For 2000 Fire
----------------------------------------------------------------
Central Garden & Pet Company reached a settlement for a class
action filed in relation to the August 2, 2000 fire that
destroyed the Company's leased warehouse space in Phoenix,
Arizona, and an adjoining warehouse space leased by a third
party. The suit, filed in the Superior Court of Arizona,
Maricopa County, alleges claims for bodily injury and property
damage as a result of the fire.
This lawsuit has now been settled as to all parties, subject to
court approval. As part of the settlement, the Company's
liability insurers will pay $8 million on behalf of the Company,
once the settlement becomes final in 2004.
CORINTHIAN COLLEGES: Teachers Launch Overtime Wage Lawsuit in CA
----------------------------------------------------------------
Corinthian Colleges, Inc. faces a class action, styled "Montoya
v. Corinthian Schools, Inc., et al.," filed in California State
Court. The plaintiff, a former instructor with the Company's
Bryman College campus in El Monte, California, alleges that she
and other instructors employed by the Company's Corinthian
Schools, Inc. subsidiary in the State of California for the
previous four years were improperly classified as exempt from
California's overtime compensation laws. Plaintiff states
causes of action under California wage orders, California's
Labor Code, and California's Business and Professions Code.
Plaintiff seeks certification as a class, monetary damages in
unspecified amounts, penalties, interest, attorneys' fees,
exemplary damages, and injunctive relief.
The Company believes its classification of employees for
overtime purposes has been consistent with applicable law and
that the plaintiff's claims are without merit. The Company
intends to vigorously defend itself in this matter, it stated in
a disclosure to the Securities and Exchange Commission.
DANE FABER: SEC Upholds Disciplinary Action Over Trading Fraud
--------------------------------------------------------------
The Securities and Exchange Commission has sustained NASD
disciplinary action against Dane S. Faber, a former registered
representative of Smith Culver, Inc., a member firm of the
National Association of Securities Dealers, Inc.
NASD found that Mr. Faber violated the anti-fraud provisions of
the federal securities laws and NASD's Conduct Rules by making
misrepresentations, omitting material facts and making
unwarranted price predictions about a speculative security.
NASD also found that Mr. Faber violated NASD Conduct Rules by
making an unsuitable recommendation of a speculative security to
a financially inexperienced customer with modest financial
means. NASD barred Mr. Faber from associating with any member
firm and ordered that he pay restitution totaling $82,220, plus
interest, to two of his customers.
The Commission found that Mr. Faber made misrepresentations,
material non-disclosures, and unwarranted price predictions to
his customers in violation of the antifraud provisions of the
federal securities laws and NASD's rules. The Commission
further found that Mr. Faber violated NASD's rules by making a
security recommendation that was unsuitable for his customer.
Finally, the Commission determined that the sanctions imposed by
NASD were not excessive or oppressive given the egregious nature
of Mr. Faber's misconduct.
IDT CORPORATION: Parties Seeking Mediator To Reach Settlement
-------------------------------------------------------------
Parties in the class action filed against IDT Corporation are
seeking a mutually agreeable mediator with the goal of reaching
a settlement for the suit, filed by six former employees of
Teligent, Inc., on behalf of themselves and other similarly
situated former employees of Teligent.
The suit, initially filed in the United States Bankruptcy Court,
Southern District of New York, alleges damages as a result of an
alleged violation of the Worker Adjustment and Retraining
Notification Act. Plaintiffs and the defendant, Teligent,
reached a settlement in the form of an unsecured claim, and now
the plaintiffs are proceeding against the Company as the sole
defendant.
The matter was transferred to the U.S. District Court from the
Bankruptcy Court. Discovery closed on October 31, 2003.
Plaintiffs estimate their damages in the range of $4 million,
exclusive of attorneys' fees. To date, the parties have not
engaged in extensive settlement discussions, but the Court is
encouraging mediation.
IDT CORPORATION: PA Court Transfers Consumer Fraud Suit To FCC
--------------------------------------------------------------
The United States District Court in the Western District of
Pennsylvania transferred the class action filed against IDT
Corporation to the Federal Communications Commission (FCC).
Mark B. Aronson filed the suit on behalf of a class consisting
of consumers who subscribed to IDT long distance service and
were charged a fee when the Company switched underlying carriers
from Global Crossing to AT&T. The Company filed an answer and
counterclaim on November 25, 2002.
At this point no specific damages have been specified in the
complaint. Thus, the Company cannot yet quantify its exposure,
the Company stated in a filing with the Securities and Exchange
Commission. The Court denied plaintiff's motion to remand the
case to state court.
IDT CORPORATION: NY Court Still To Decide on Suit Certification
---------------------------------------------------------------
The Supreme Court of the State of New York has yet to decide on
class certification for the lawsuit filed against IDT
Corporation and Union Telecard Alliance, LLC.
The suit was filed on behalf of New York consumers who allegedly
purchased and used the Company's pre-paid calling cards from
July 31, 2001 to the present and were charged any fee that was
not specifically disclosed on the card packaging prior to
purchase. The complaint seeks damages in excess of $100 million
dollars.
The plaintiff filed a motion for a preliminary injunction and a
motion for class certification. The Company filed opposition to
the motion for a preliminary injunction and to the motion for
class certification, and a motion for summary judgment. These
motions have not been fully briefed yet and therefore have not
been adjudicated before the Court.
IDT CORPORATION: FL Court Yet To Rule in Lawsuit Certification
--------------------------------------------------------------
The Circuit Court of the 15th Judicial Circuit in and for Palm
Beach County, Florida has yet to decide on class certification
for a lawsuit filed against IDT Corporation and Union Telecard
Alliance, LLC.
The suit was filed on behalf of Florida consumers who from July
31, 2001 to the present allegedly purchased and used the
Company's prepaid calling cards and were charged any fee that
was not specifically disclosed on the card packaging prior to
purchase. The damages sought have not yet been quantified.
On December 6, 2002, the Company served its answer to the
complaint. The plaintiff filed a motion for class
certification, which has not been fully briefed yet and
therefore has not been adjudicated before the Court. In the
meantime, discovery is ongoing.
IDT CORPORATION: Discovery Proceeds in NJ Consumer Fraud Lawsuit
----------------------------------------------------------------
Discovery is proceeding in the consolidated class action filed
against IDT Corporation and IDT Telecom, Inc. in the United
States District Court for the District of New Jersey on behalf
of consumers in the United States who purchased the Company's
calling cards.
On October 18, 2002, Morris Amsel filed a complaint against the
Company and IDT Telecom, Inc. in the Supreme Court of the State
of New York. Plaintiff's complaint relates to payphone charges
and international rates. The complaint seeks damages of not
less than $100 million. The Company removed this case to the
United States District Court for the Southern District of New
York. On November 21, 2002, the Company served an answer to the
complaint. It continues to respond to discovery requests.
On December 26, 2002, Ana Cardoso and Maria Calado against the
Company, IDT TELECOM, INC., and Union Telecard Alliance, LLC in
the Superior Court of the State of New Jersey, Union County,
filed a complaint. The suit seeks certification of a nationwide
class consisting of consumers throughout the United States who
allegedly purchased the Company's pre-paid non-rechargeable
calling cards and were charged any fee that was not specifically
disclosed on the card packaging prior to purchase. The damages
sought have not yet been quantified. On February 6, 2003, the
Company served its answer to the complaint. The Company also
removed this case to the Federal District Court for the District
of New Jersey.
The Company filed an application with the Multidistrict
Litigation Panel (the MDL Panel) seeking to consolidate for pre-
trial purposes the Cardoso and Amsel actions. The motion to
consolidate was heard before the MDL Panel on July 24, 2003. On
August 21, 2003, the MDL Panel granted the motion to transfer
and consolidate the two federal actions for pre-trial purposes
before Judge William H. Walls in the District of New Jersey. On
September 30, 2003, the parties appeared before Magistrate Judge
Wigenton to set a new discovery schedule.
On February 5, 2003, Solomon Bitton filed a complaint against
the Company and Union Telecard Alliance, LLC in the Superior
Court of the State of New Jersey, Bergen County, seeking
certification of a class consisting of New Jersey consumers who
allegedly purchased the Company's prepaid calling cards and were
charged any fee that was not specifically disclosed on the card
packaging prior to purchase. The damages sought have not yet
been quantified.
The Company served its answer to the complaint on April 3, 2003
and is in the process of responding to discovery requests. The
parties attended an initial scheduling conference on May 22,
2003 and the court entered a schedule relative to class
discovery. A status conference was also held on October 28,
2003.
IDT CORPORATION: Faces Consumer Suit Over Long Distance Service
---------------------------------------------------------------
IDT Corporation and IDT Telecom, Inc. faces a class action filed
by Irene Kieves in the United States District Court for the
District of New Jersey. The plaintiff is seeking certification
of a class consisting of all persons who subscribed to IDT long
distance service and paid any Universal Service Fund surcharge
associated with such service at any time since January 1, 1998.
The damages sought have not yet been quantified.
Because the Company only recently received the complaint, it is
still evaluating the potential impact and its approach to
contesting the claims or attempts to certify the classes, the
Company revealed in a disclosure to the Securities and Exchange
Commission.
LUCENT TECHNOLOGIES: Continues Implementing NJ Suit Settlement
--------------------------------------------------------------
Lucent Technologies is continuing the administration process for
the giant settlement agreement it forged in March 2003 to settle
assorted securities, Employee Retirement Income Security Act
(ERISA) and derivative class action and other related lawsuits
against the Company and certain of its current and former
directors, officers and employees.
The Company did not admit any wrongdoing as part of the
settlement. It received final approval of the settlement from
the U.S. District Court in Newark, New Jersey, on December 12,
2003. One of the cases (the Winstar securities case) is pending
in the U.S. District Court for the Southern District of New
York, for which a fairness hearing is being scheduled. A
portion of the settlement proceeds described below has been
allocated to the Winstar securities case.
The agreement is a global settlement of 53 separate lawsuits,
including a consolidated shareowner class action lawsuit in the
U.S. District Court of New Jersey, and related ERISA,
bondholder, derivative, and other state securities cases. Under
the settlement agreement, the Company will pay $315 million in
common stock, cash or a combination of both, at the Company's
option.
On December 24, 2003, the Company deposited 33 million shares of
common stock into escrow, representing the initial $100 million
payment of the settlement amount. These shares will be
considered issued for financial reporting purposes during the
Company's second quarter of fiscal 2004. The Company also will
issue warrants to purchase 200 million shares of its common
stock at an exercise price of $2.75 per share with an expiration
date three years from the date of issuance. As of December 31,
2003, the value of these warrants was approximately $221
million, based upon the Black-Scholes option-pricing model.
In addition to the Company's contributions, certain of its
insurance carriers have agreed to pay their available policy
limits of $148 million in cash into the settlement fund. The
Company's former affiliate, Avaya Inc., is contractually
responsible under its agreements with the Company to contribute
an additional $24 million to the settlement. In connection with
the settlement, the Company will pay up to $5 million in cash
for the cost of settlement administration and will pay for
certain other costs involved in the issuance of securities.
The settlement covers all claims generally relating to the
purchase of Lucent securities during different class periods.
The primary class period is October 26, 1999 through December
20, 2000. The Company expects that the appeals and claims
administration process will continue until sometime in the
fourth quarter of fiscal 2004 or in fiscal 2005 and does not
expect to distribute any proceeds until that time.
The Company continues to pursue partial recovery of the
settlement amount from its fiduciary insurance carriers under
certain insurance policies that provide coverage up to $70
million. The Company has filed a lawsuit against them to
recover these amounts. The charge for the settlement will be
revised in future quarters if it is able to recover a portion of
the settlement from its fiduciary insurance carriers, as well as
to reflect additional changes in the fair value of the warrants
until they are issued. The estimated fair value of the warrants
may increase significantly if the share price of the Company's
common stock increases.
The Company will defend any lawsuits that may be brought by
parties that have opted out of the settlement. The Company and
certain of its current and former officers and directors are
defendants in an action in the U.S. District Court in New
Jersey, Staro Asset Management, LLC v. Lucent Technologies Inc.
et al., alleging violations of federal securities laws. The
case was originally part of the global settlement referred to
above. However, the plaintiff has opted out of the settlement
and is pursuing its claim separately against the defendants.
The Company has moved to dismiss the complaint.
LUCENT TECHNOLOGIES: Faces Consumer Fraud Suits in WV, NY, CA
-------------------------------------------------------------
Lucent Technologies, Inc. faces three separate purported class
actions, one pending in state court in West Virginia, one in
federal court in the Southern District of New York and another
in federal court in the Southern District of California.
The case in New York was filed in January 1999 and, after being
dismissed, was refiled in September 2000. The case in West
Virginia was filed in April 1999 and the case in California was
filed in June 1999, and amended in 2000 to include Avaya, Inc.
as a defendant. Avaya, Inc. may also be named a party to the
other actions and, in any event, has assumed the obligations of
Lucent for all of these cases under the Contribution and
Distribution Agreement.
All three actions are based upon claims that Lucent sold
products that were not Year 2000 compliant, meaning that the
products were designed and developed without considering the
possible impact of the change in the calendar from December 31,
1999 to January 1, 2000. The complaints allege that the sale of
these products violated statutory consumer protection laws and
constituted breaches of implied warranties.
A class has been certified in the West Virginia state court
matter. The certified class in the West Virginia matter
includes those persons or entities that purchased, leased or
financed the products in question. In addition, the court also
certified as a subclass all class members who had service
protection plans or other service or extended warranty contracts
with Lucent in effect as of April 1, 1998, as to which Lucent
failed to offer a free Year 2000-compliant solution.
The Fourth Circuit Court of Appeals recently denied the
defendant's attempt to have the Federal District Court in West
Virginia retain jurisdiction in this matter. The federal court
in the New York action has issued a decision and order denying
class certification, dismissing all but certain fraud claims by
one representative plaintiff. No class claims remain in this
case at this time.
The federal court in the California action has issued an opinion
and order granting class certification. The class includes any
entities that purchased or leased certain products on or
after January 1, 1990, excluding those entities who did not have
a New Jersey choice of law provision in their contracts and
those who did not purchase equipment directly from defendants.
The federal court in the California action has issued an order
staying the action pending the outcome of the West Virginia
matter. The complaints seek, among other remedies, compensatory
damages, punitive damages and counsel fees in amounts that have
not yet been specified.
At this time, the Company cannot determine whether the outcome
of these actions will have a material adverse effect on its
financial position, results of operations or cash flows. These
cases have required in the past, and may require in the future,
expenditure of significant legal costs related to their defense.
MARTHA STEWART: NY Court Refuses To Declare Mistrial in Lawsuit
---------------------------------------------------------------
United States District Court in New York judge Martha Cedarbaum
refused to declare a mistrial in the Martha Stewart case, the
Associated Press reports.
Ms. Stewart and her former Merrill Lynch stockbroker Peter
Bacanovic face trial for conspiring to hide the reason that Ms.
Stewart sold 4,000 shares in biotech company ImClone Systems
Inc. on December 27,2001, just before the Company announced that
its key drug application had been refused. While prosecutors
say Ms. Stewart believed she had gotten a secret tip, she is not
charged with insider trading.
Lawyers for the domestic trendsetter asked the court to declare
a mistrial, because they were wrongfully barred from arguing
that no insider trading took place. They wanted to introduce
witnesses to testify that the sale did not amount to insider
trading, which Judge Cedarbaum repeatedly denied. This prompted
Ms. Stewart's lawyers to seek a mistrial.
"To have a minitrial on insider trading ... would so confuse and
distract the jury from the charges in the indictment" that they
could not fairly decide the case, Judge Cedarbaum said, AP
reports.
Robert Morvillo argued that the defense was built on the premise
that the defendants cannot be convicted of lying to authorities
when they are not charged with insider trading. "That's the way
we set up our defense in this case," he told the judge. He
added he wants to prove there was "an absence of motive" by
"proving there was no insider-trading violation."
Mr. Morvillo sought the mistrial shortly before he began cross
examination of Securities and Exchange Commission lawyer Helene
Glotzer, who has testified that Ms. Stewart lied to
investigators looking into the stock sale. Ms. Glotzer's
testimony, which started on Tuesday, began a new phase of the
trial in which the government is focusing on charges that
Stewart and Bacanovic made a series of false statements to
federal officials during interviews in 2002.
MUTUAL FUNDS: SEC Proposing Ban on Trading Incentives, Practices
----------------------------------------------------------------
The Securities and Exchange Commission voted in a public meeting
to propose a ban on special incentive payments by fund companies
to brokerages, as they strengthen their response to the massive
mutual fund scandal, the Associated Press reports.
The proposed ban on incentive payments to brokers is one of the
most radical proposals advanced to date affecting Wall Street
investment houses and the mutual fund industry. In September, a
huge fraud scandal broke out over trading practices such as
"market timing," and late trading, which favor some big
investors to the detriment of ordinary shareholders. Several
shareholder suits have been filed against several big fund
companies and their top executives, while dozens of companies
are under investigation.
The SEC, which has been making a series of changes in rules
governing the mutual fund industry, is promising "relief" to
investors from fund abuses by early summer. They voted to ban
the practices that create conflicts of interests and drives up
costs to investors.
SEC Chairman William Donaldson said, according to AP, that in
recent years, "It has become painfully clear that the practice
of directing ... (fund money) to a broker or dealer as
compensation for distribution of the fund's shares presents
opportunities for abuse." The practice is all the more
troubling, he said, "because its impact is hidden from
investors."
The SEC panel also proposed to adopt a new rule requiring funds
to provide investors a twice-yearly "shareholder report" with
fuller information on fees and expenses. The report would
include the dollar amount of fund expenses paid by shareholders
on a $1,000 investment. The new disclosure will "enable
investors to determine the amount of fees they paid on an
ongoing basis, as well as to compare the amount of fees charged
by other funds," Paul Roye, head of the SEC division that
oversees the mutual fund industry, told AP before the vote.
Also under the new rule, fund companies will be required to give
investors more information every quarter about the stocks the
funds invest in. The proposal will be submitted for public
comment for several weeks and likely adopted by the agency
sometime afterward.
New bipartisan legislation by several senators also would outlaw
the practice of fund incentive payments to brokers and other
industry practices, significantly changing the way mutual fund
companies conduct business with investors and the brokers who
sell them funds.
Stephen Cutler, the SEC's top enforcement official, disclosed
that the agency is investigating numerous cases in which
brokerage firms may have failed to fully disclose that they
pushed clients to buy certain mutual funds in exchange for
payments from the fund companies, AP reports.
An SEC inspection of brokerages that sell mutual funds found
that 14 of 15 received cash from funds' investment advisers and
two-thirds accepted payments in the form of commissions on fund
trades, a practice known as revenue sharing. In return for the
payments, 13 of the 15 brokerage firms appear to have favored
the affected funds by giving them greater visibility on their
Web sites and promoting them in materials to customers, SEC
officials told AP. The inspection found that for every $100,000
in sales to customers of favored funds, brokers pocketed between
$50 and $400.
NEW ENGLAND: Reaches Settlement For Unsolicited Fax Suit in SC
--------------------------------------------------------------
New England Business Service, Inc. reached an agreement to
settle the class action, entitled "OLDAPG, Inc. v. New England
Business Service, Inc." filed against it in the Court of Common
Pleas of the Ninth Judicial Circuit in and for Charleston
County, South Carolina.
The named plaintiff in the lawsuit sought to represent a class
consisting of all persons who allegedly received facsimiles
containing unsolicited advertising from the Company in violation
of the Telephone Consumer Protection Act of 1991 (TCPA).
The litigation was settled by agreement between the parties in
December 2003 on terms which are not material to the Company's
consolidated financial position or results of operations, the
Company stated in a disclosure to the Securities and Exchange
Commission.
OFFERING FRAUDS: SEC Commences Emergency Enforcement Lawsuit
------------------------------------------------------------
The Securities and Exchange Commission filed an emergency
enforcement action to halt three offering frauds being conducted
by representatives of three entities:
(1) Equity Service Associates, Inc.;
(2) MB Holdings USA, Inc.; and
(3) OCC Holdings, Ltd, a/k/a OnCallContractors.com
(OnCall)
Along with its complaint, the Commission filed an application
for emergency relief, including temporary restraining orders,
orders freezing the defendants' and relief defendants' assets,
and expedited discovery.
The Commission's complaint, filed in the U.S. District Court for
the Southern District of New York, alleges that since December
2001, the defendants fraudulently raised more than $2 million
from investors through three offerings:
(i) the sale of purported private placement shares of
OnCall;
(ii) the sale of promissory notes issued by MB Holdings and
other entities; and
(iii) the purported sale of restricted shares of an
unrelated, privately owned company.
The offerings are all allegedly being orchestrated by, and/or
for the benefit of, Mr. Labineri and/or Mr. Tanwir, who have
allegedly been conducting fraudulent offerings together since at
least 1999. According to the complaint, in conducting the
offerings, the defendants have made false and misleading
promises of imminent initial public offerings (IPOs) and/or
substantial increases in the stock price; have misappropriated
and used investor funds for personal expenses; and failed to
disclose their disciplinary history. Their purported business
addresses are merely mail drops and call centers.
Specifically, the complaint alleges that the conduct has its
origins in a series of offering frauds conducted by
representatives of Bernard Lee, a now defunct registered broker-
dealer, and Grant Singer, an unregistered broker-dealer
controlled by Mr. Labineri. Mr. Tanwir, Mr. Favata and Mr. Awan
all worked as brokers for Bernard Lee; Mr. Tanwir also worked
for Grant Singer. Mr. Labineri, Mr. Tanwir, Mr. Favata, OnCall,
and Grant Singer were subjects of disciplinary actions by the
Maryland State Securities Commission and the NASD relating to
the Bernard Lee-Grant Singer fraudulent offerings.
Among the illegal conduct alleged is the failure to disclose the
relevant disciplinary history to investors who purchased OnCall
stock and invested in promissory notes purportedly guaranteed by
Grant, Singer & Hamilton Holdings, Inc. In addition to the
unfounded promises of imminent IPOs and substantial price
increases, and the failure to disclose relevant disciplinary
history, the complaint charges that substantial portions of the
OnCall offering proceeds were misappropriated and used for
defendants' personal expenses; and that representations to
investors that the promissory notes were risk-free because they
were guaranteed by Grant, Singer, were false because Grant,
Singer did not have the intention or ability to honor the
guarantees and its purported president, Nathan Singer, did not
exist.
Named as defendants in the Commission's complaint are:
(a) OnCall, a company that purportedly provides
construction-related services over the Internet and
maintains offices in on Madison Ave. in New York, and
in Blakeslee, Pennsylvania. Defendant Joseph Favata
founded OnCall and has served as its president and
chairman since its inception. The complaint charges
OnCall in connection with the fraudulent sales of
OnCall stock;
(b) MB Holdings, an unregistered broker-dealer purportedly
located on Wall Street. MB Holdings is charged in
connection with the fraudulent offerings;
(c) Equity Service, an unregistered broker-dealer
purportedly located in Midtown Manhattan. Equity
Service is charged in connection with the purported
sales of the restricted stock.
(d) Alan Labineri, a former registered representative, the
president of Equity Service and relief defendant Off
World Strategic Holdings, among other entities. Mr.
Labineri resides in Brooklyn, New York. The complaint
charges him for his role in all three fraudulent
offerings.
(e) Khurram Tanwir, a/k/a "Corey Taylor," the president of
MB Holdings and a consultant to OnCall. Mr. Tanwir, a
former registered representative, resides in Manhattan.
The complaint charges him for his role in all the
offerings.
(f) Joseph Favata, a former registered representative and
the founder, president, chairman, and majority
shareholder of OnCall. Mr. Favata resides in
Albrightsville, Pennsylvania. He is charged with his
role in the OnCall offering.
(g) Ahmed Awan, a former registered representative and an
employee of M.B. Holdings. Mr. Awan resides in
Brooklyn, New York. The complaint charges him for his
role in the fraudulent sale of the promissory notes.
(h) Yakov Koppel, a registered representative who resides
in Monroe, New York. Mr. Koppel is charged for his
role in the OnCall offering.
The Commission alleges that, through their misconduct, the
defendants violated Section 17(a) of the Securities Act of 1933,
and Section 10(b) of the Securities Exchange Act of 1934, and
Exchange Act Rule 10b-5. In addition to interim relief, the
Commission is seeking permanent injunctions, disgorgement and
prejudgment interest, and civil penalties against the
Defendants, and seeks to recover ill-gotten gains transferred to
the relief defendants. The litigation is pending.
OPLINK COMMUNICATIONS: Reaches Settlement For NY Securities Suit
----------------------------------------------------------------
Oplink Communications, Inc. reached a settlement for the
securities class action filed against it and certain of its
officers and directors in the United States District Court for
the Southern District of New York, captioned, In re Oplink
Communications, Inc. Initial Public Offering Securities
Litigation, Case No.01-CV-9904.
In the amended complaint, the plaintiffs allege that the
Company, certain of the Company's s officers and directors and
the underwriters of the Company's initial public offering, or
IPO, violated section 11 of the Securities Act of 1933 based on
allegations that the Company's registration statement and
prospectus failed to disclose material facts regarding the
compensation to be received by, and the stock allocation
practices of, the IPO underwriters.
The complaint also contains a claim for violation of section
10(b) of the Securities Exchange Act of 1934 based on
allegations that this omission constituted a deceit on
investors. The plaintiffs seek unspecified monetary damages and
other relief.
Similar complaints were filed by plaintiffs against hundreds of
other public companies that went public in the late 1990s
(collectively, the "IPO Lawsuits"). On August 8, 2001, the IPO
Lawsuits were consolidated for pretrial purposes before United
States Judge Shira Scheindlin of the Southern District of New
York.
On July 15, 2002, the Company joined in a global motion to
dismiss the IPO cases filed by all of the Issuers (among
others). On October 9, 2002, the Court entered an order
dismissing the Company's named officers and directors from the
IPO Lawsuits without prejudice, pursuant to an agreement tolling
the statute of limitations with respect to these officers and
directors until September 30, 2003.
On February 19, 2003, the Court issued a decision denying the
motion to dismiss the Section 11 claims against the Company and
almost all of the Issuers, and granting the motion to dismiss
the Section 10(b) claim against the Company. The Section 10(b)
claim was dismissed without leave to amend.
In June 2003, Issuers and Plaintiffs reached a tentative
settlement agreement that would, among other things, result in
the dismissal with prejudice of all claims against the Issuers
and their officers and directors in the IPO Lawsuits. In
addition, the tentative settlement guarantees that, in the event
that the Plaintiffs recover less than $1 billion in settlement
or judgment against the Underwriter defendants in the IPO
Lawsuits, the Plaintiffs would be entitled to payment by each
participating Issuer's insurer of a pro rata share of any
shortfall in the plaintiff's guaranteed recovery. In such
event, the Company's obligation would be limited to
reimbursement of the Company's insurer up to the amount
remaining under the deductible of the Company's insurance
policy.
In September 2003, in connection with the tentative
settlement, those officers and directors who had entered tolling
agreements with the Plaintiffs agreed to extend those agreements
so that they would not expire prior to any settlement being
finalized. Although the Company has approved this settlement
proposal in principle, it remains subject to a number of
procedural conditions, as well as formal approval by the Court.
Pending a definitive settlement, the Company continues to
believe that the action against it is without merit and intends
to continue to defend against it vigorously.
PARAGON CONSTRUCTION: Ex-Execs Settle SEC Complaint over Fraud
--------------------------------------------------------------
The Securities and Exchange Commission announced that John R.
Boyd and Christopher Curbello, former Golden Bear Golf, Inc.,
executives who headed Paragon Construction International, Inc.,
Golden Bear Golf's defunct golf course construction subsidiary,
have settled the enforcement action the Commission filed against
them in August 2002 which alleged that Mr. Boyd and Mr. Curbello
directed a scheme that had the effect of artificially inflating
Golden Bear's results by overstating Paragon's revenues and
concealing losses.
Mr. Boyd is the former president of Paragon and Mr. Curbello was
Paragon's vice president for operations. They consented to the
settlements without admitting or denying the Commission's
allegations. The settlements permanently enjoin Mr. Boyd and
Mr. Curbello from further violations of the federal securities
laws.
In addition to agreeing to settlements with the Commission, Mr.
Boyd and Mr. Curbello also have pled guilty to federal criminal
charges arising out of their scheme. Mr. Curbello entered a
guilty plea to conspiracy to commit securities fraud charges in
October 2003 and Mr. Boyd entered a guilty plea to the same
charges in November 2003. As a result of those guilty pleas,
Mr. Curbello currently is serving a three and a half year prison
sentence and Mr. Boyd is serving a five-year prison sentence.
In connection with pleading guilty to federal criminal charges,
Mr. Boyd and Mr. Curbello admitted that they conspired to
artificially inflate and accelerate Paragon's revenue and gross
margin recognition by misrepresenting the true status of its
construction contracts, causing Golden Bear to file false and
misleading financial statements for its 1997 fiscal year and for
the first quarter of 1998. Under the scheme, Paragon overstated
contract profitability or ignored expected losses by
understating estimated construction costs, accelerating revenue
and income recognition by overstating progress on construction
projects, overstating estimated construction revenues and
recording revenue and gross margin in connection with non-
existent project agreements. The loss amount to shareholders
was determined to be in excess of $49 million.
The suit is styled, "SEC v. John R. Boyd and Christopher
Curbello, Case No. 02-80726-CIV-Judge Hurley (S.D.Fla.)."
POLO RALPH: Discovery in Wardrobing Suit To Resume In May 2004
--------------------------------------------------------------
Discovery in the class action filed against Polo Ralph Lauren
Corporation in the United States District Court in San
Francisco, California is set to commence on May 12,2004.
Employee Toni Young filed the suit against the Company, alleging
violations of California antitrust and labor laws. The suit,
which also names Polo Retail LLC as a defendant, purports to
represent a class of employees who have allegedly been injured
by the Company's requirement that certain retail employees
purchase and wear Polo Ralph Lauren merchandise as a condition
of their employment. The complaint, as amended, seeks an
unspecified amount of actual and punitive damages, disgorgement
of profits and injunctive and declaratory relief, an earlier
Class Action Reporter story (November 18,2002) states.
The Court granted partial summary judgment with respect to
certain of the plaintiff's claims, but concluded that more
discovery was necessary before it could decide the key issue as
to whether the Company had maintained a dress code policy, for a
period of time, that violated California law. The court ordered
the parties to conduct limited discovery to that end, to be
completed by the end of the year. Discovery has been stayed
pending the outcome of mediation between the parties.
STANDARD COMMERCIAL: Paid Its Share in NC Tobacco Merchants Suit
----------------------------------------------------------------
Standard Commercial Corporation has paid its share in the
settlement of the class action filed against it and other leaf
merchants, styled "Deloach, et al. V. Philip Morris Inc., et
al.," filed in the United States District Court for the Middle
District of North Carolina, Greensboro Division (Case No. 00-CV-
1235).
The suit was originally filed against U.S. cigarette
manufacturers in the United States District Court for the
District of Columbia. The Deloach suit is a class action claim
brought on behalf of U.S. tobacco growers and quota holders
alleging that defendants violated antitrust laws by bid-rigging
at tobacco auctions and by conspiring to undermine the tobacco
quota and price support program administered by the federal
government.
In May 2003, the Company, along with several other domestic
cigarette manufacturers and tobacco-leaf dealers, entered into a
settlement agreement with the plaintiffs. Under the agreement,
the Company agreed to pay $7 million for distribution of the
class. The total amount paid by all the settling defendants, to
the class is approximately $212.0 million, plus commitments by
the three settling cigarette manufacturers to purchase certain
volumes of domestic flue-cured and burley tobacco for at least
10 years and to pay the fees of plaintiffs' counsel. The court
approved the settlement agreement in October 2003.
WINN DIXIE: Faces Lawsuit For Securities Violations in M.D. FL
--------------------------------------------------------------
Winn Dixie Stores, Inc. and three of its present and former
executive officers face a putative class action filed in the
United States District Court for the Middle District of Florida,
on behalf of a class of purchasers of the Company's common stock
during the period from October 9, 2002 through and including
January 29, 2004.
The complaint alleges claims under the federal securities laws,
specifically Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934 and Rule 10b-5 promulgated thereunder. The
complaint generally alleges that, during the Class Period, the
defendants made false and misleading statements regarding the
Company's marketing and competitive situation, self-insurance
reserves, impairment of assets, and other matters. The
complaint seeks certification as a class action, unspecified
compensatory damages, attorneys' fees and costs, and other
relief.
Asbestos Alert
ASBESTOS LITIGATION: Widow Says Asbestos Exposure Cases on Rise
---------------------------------------------------------------
The grieving widow of a former Derry mayor who died from
asbestos-related cancer reveals that more people from the North
West are falling victim to asbestos-related diseases, according
to an article by icDerry.
Tony Carlin's family are traveling to Belfast to make final
preparations for their High Court test case for compensation.
Mr. Carlin died a year ago at the age of 56, just 11 months
after he was diagnosed with mesothelioma, which is caused solely
by exposure to asbestos, the report said.
The former Social Democratic and Labor Party councilor came in
contact with asbestos during a brief period nearly 40 years
prior to contracting his devastating illness. Speaking to the
'Journal' on February 9, Mr. Carlin's widow, Mary, said she had
finally received a copy of the post-mortem report and her
husband's death certificate after a lengthy delay.
"Tony had done a lot of the work himself before he died
preparing the case. He went through all the different tests
that were asked of him. The delay was in waiting for a copy of
the postmortem report and the death certificate which I
eventually got," she said.
Describing the pathologist's report as "unbelievable," Mrs.
Carlin said, "Professor Crane examined every part of Tony's body
and everything was perfect when it went down the list except for
the tumor behind the lung which was caused by blue asbestos . It
is there in black and white and nobody can argue with it."
Recalling her shock at the father of five's death on February 1
last year, Mrs. Carlin told the Journal, "It happened so quickly
and there have been a few more deaths recently with mesothelioma
out in the country area around Donemana. One person died after
twenty days of diagnosis and one after a month."
The Carlin family is suing two companies, DuPont and Fleurs, who
built the BOC plant where Tony Carlin worked for a brief period
in the 1960s.
Mrs. Carlin claimed, "They (workers) weren't told then - 36
years ago - the dangers which could come from the asbestos.
Myself and my family have gathered up a lot of information
preparing for the case and it is unbelievable how many deaths
there have been in England . One statement in our papers, from
the British Asbestos Association, says that one person every
five hours dies in the UK of mesothelioma . e are just waiting
on a date for the hearing."
The Derry Justice for Victims of Asbestos group will continue
its campaign at its first meeting of 2004 on the evening of
February 10 in the MDEC Unit at Altnagelvin Hospital at 7:30
p.m.
"We are hoping for a good turnout because we have had quite a
lot of enquiries. Apparently there have been more people
diagnosed with asbestosis since our last meeting . People have
been asking for information but we have no solicitors in town to
deal with our queries. We have a firm of solicitors in Belfast
who are dealing with cases involving Harland and Wolff. We just
hope that if people have questions we can give them answers and
point them in the right direction," Mrs. Carlin told Journal.
ASBESTOS LITIGATION: EPA Slashes Down Asbestos Workers' Wages
-------------------------------------------------------------
Workers removing asbestos from contaminated homes in Libby,
Montana had their wages slashed last month as U.S. Environmental
Protection Agency officials try to stretch cleanup dollars for
the town designated the nation's highest priority Superfund
site, The Montana Standard reports.
"We started looking at ways we could reduce costs and get more
cleanup done," Jim Christiansen, EPA project manager for the
Libby cleanup project told the state bureau. "We've done quite
a bit to do that and one of the last ways of was worker wages."
Workers had their pay abruptly cut from about $24 an hour to
about $14 late last month, he said, adding that he regrets the
severity of the cut and the short notice of it workers received.
The cut was announced to workers the day before it went into
effect.
Mr. Christiansen recently said the wage reduction went too far,
and the EPA is working to restore at least some of the workers'
former pay. A meeting is planned in Libby on February 11 to
discuss the situation with workers.
He hopes their wages will be bumped to about $19 an hour.
Workers will also be paid back pay to restore some of the cut.
He said he expects the situation to be resolved in a few weeks.
"It sounds really bad, and it was really bad," he told the
bureau. "The way it happened wasn't the way I wanted it to
happen. The workers are very upset and if I were them, I would
be, too. We've been working really hard in the last couple of
weeks to get this turned around."
Libby is the site of a former W.R. Grace vermiculite mine, which
produced vermiculite fibers for insulation and soil conditioners
for decades. At its peak, the mine produced up to 80 percent of
the world's supply of vermiculite.
The ore mined in Libby was contaminated with asbestos, which can
cause lung disease and cancer. Hundreds of former miners and
their families have since died of lung disease, the report said.
The EPA started cleaning up the mine in 1999 and removing
tainted insulation from homes and businesses a few years later.
Reasons for the wage reduction were two-fold, Mr. Christiansen
said. First, officials were looking for a way to hire more
workers and clean up more homes and business with the same
amount of money.
Secondly, he said, the duties of the cleanup workers had changed
from officially designated "heavy construction" work to work
more in line with "residential construction."
Because the workers are paid with federal money, their wages are
set according to federal standards. The wage for "residential
construction" workers is less than the federally designated wage
for "residential construction" crews, Mr. Christiansen told the
bureau.
Consequently, the EPA decided it could pay the workers less
based on the kind of work they were doing.
The savings will be used to hire more workers this spring and
summer, the report said.
Mr. Christiansen said there were about 30 to 40 cleanup workers
affected by the change.
The U.S. Department of Labor is now doing a wage assessment to
see what fair pay for the current cleanup work should be.
"We're looking at about $19.55," he told The Montana Standard.
Mr. Christiansen said the Libby cleanup project - designated the
highest Superfund priority in the nation - has always been tight
on money. He said his initial goal was to clean up 250 homes
and business each year with a total of about 1,200 homes and
businesses. But last year, the project had enough money to do
only 130 houses. Mr. Christiansen said that even with the wage
cuts, he doesn't think the agency will be able to clean up that
many houses this year.
"The budget is a little tighter this year," he said.
Gayla Benefield, president of the Lincoln County Asbestos
Victims Relief Organization, said the pay cut is unacceptable.
"This is really discouraging for the No. 1 priority of the EPA
to allow this to happen," she told The Montana Standard. "It
all comes down on the back of the working man in Montana."
Libby Mayor Tony Berget told The Montana Standard that while he
was displeased with the sudden cut, he thinks the EPA is doing
its best to make amends.
"I'm pleased with the EPA's response," he told the bureau.
Both Montana's U.S. senators - Sen. Conrad Burns, R-Mont., and
Sen. Max Baucus, D-Mont. - said upset workers in Libby contacted
them soon after the cut went down.
"These workers are doing an important job and a difficult job
and they need to compensated fairly," Sen. Burns' spokesman
J.P. Donovan told the bureau.
The Baucus camp offered similar sentiments.
"Max is extremely frustrated that it appears that momentum for
(cleaning up) Libby seems to be fading," Sen. Baucus'
spokesperson told The Montana Standard.
ASBESTOS LITIGATION: CONSOL Unit Battles 22,600 Asbestos Claims
---------------------------------------------------------------
CONSOL Energy Inc. reports in its latest regulatory filing with
the Securities and Exchange Commission that one of its
subsidiaries, Fairmont Supply Company, is a co-defendant in
around 22,600 asbestos claims in various state courts. The cases
against the Company are filed in Pennsylvania, Ohio, West
Virginia, Maryland, New Jersey and Mississippi.
It has been difficult for Fairmont to determine how many of the
cases actually involve valid claims of plaintiffs who were
actually exposed to asbestos-containing products supplied by
Fairmont because a very small percentage of products
manufactured by third parties and supplied by Fairmont in the
past may have contained asbestos and many of the pending claims
are part of mass complaints filed by hundreds of plaintiffs
against a hundred or more defendants, the filing said.
While Fairmont may be entitled to indemnity or contribution in
certain jurisdictions from manufacturers of identified products,
the availability of this indemnity or contribution is unclear at
this time and, in recent years, some of the manufacturers named
as defendants in these actions have sought protection from these
claims under bankruptcy laws.
Fairmont has no insurance coverage with respect to these
asbestos cases. So far, payments by Fairmont with respect to
asbestos cases have not been material. However, payments in the
future with respect to pending or future asbestos cases could be
material to the company's financial position, results of
operations or cash flows of CONSOL.
CONSOL has been informed by insurance companies that, unless
provided with collateral, they no longer will issue surety bonds
that it and other coal mining companies are required by law to
obtain. Fairmont Supply distributes industrial supplies.
ASBESTOS LITIGATION: Crown Holdings Increases Asbestos Reserves
---------------------------------------------------------------
Crown Holdings Inc. estimates that its asbestos-related expenses
for pending and future asbestos claims will range between
$239,000,000 and $406,000,000, according to its latest
regulatory filing with the Securities and Exchange Commission.
In its previous filing, the Company pegged its range of
potential liability for pending and future asbestos claims that
are probable and estimable between $233,000,000 and $472,000,000
as of June 30, 2003.
After the charge of $44,000,000, the Company's reserve at Dec.
31, 2003, was $239,000,000 compared to $263,000,000 at Dec. 31,
2002. Asbestos-related payments totaled $69,000,000 in 2003,
including $41,000,000 under existing settlement agreements,
compared to 2002 payments of $114,000,000, which included
$75,000,000 under existing settlement agreements.
Crown expects that 2004 asbestos-related payments will total
around $65,000,000, including $25,000,000 from existing
settlement agreements.
Crown Holdings, formerly Crown Cork & Seal Company, is a leading
worldwide producer of consumer packaging. Its product portfolio
consists of aerosol cans, food and beverage cans, paint cans,
plastic bottles and other containers, and a variety of metal and
plastic caps, crowns, and closures.
ASBESTOS LITIGATION: USG Corporation to Re-Emerge from Chap. 11
---------------------------------------------------------------
USG Corporation executive declares that its "businesses are
healthy and profitable."
William C. Foote, USG Corporation Chairman, President and CEO,
said in the Company's fourth quarter results filing with the
Securities and Exchange Commission that one of the Company's
primary goals is to build and further strengthen USG's
businesses, ensuring that they are well-positioned for continued
success when the Company emerges from asbestos-related Chapter
11 reorganization. He further said that the Company's results
demonstrate solid progress toward that goal.
USG and its principal domestic subsidiaries filed voluntary
petitions for reorganization under Chapter 11 of the United
States Bankruptcy Code on Jan. 25, 2001 to resolve asbestos
claims in a fair and equitable manner.
USG's bankruptcy cases were assigned to Judge Alfred M. Wolin of
the U.S. District Court for the District of New Jersey.
In November 2003, USG and the Official Committee of Unsecured
Creditors in USG's bankruptcy cases filed a motion to remove
Judge Wolin from presiding over USG's cases. Certain creditors
in other asbestos-related bankruptcy cases assigned to Judge
Wolin brought similar motions for removal.
Judge Wolin refuses to recuse himself from these cases.
USG Corporation is the leading maker of gypsum wallboard, ready-
mixed joint compounds, DUROCK cement board, underlayment,
ceiling grids and tiles. The Illinois-based wall-maker owns 15
gypsum mines in North America.
ASBESTOS LITIGATION: UTC Sees Increase in Asbestos-Related Suits
----------------------------------------------------------------
Hartford, Connecticut-based holding company United Technologies
Corporation (UTC) revealed in its latest regulatory filing with
the Securities and Exchange Commission that it continues to face
around 1,500 asbestos-related raps.
UTC said its asbestos-related lawsuits soar from the roughly 850
suits it was named in last year. The suits involve about 24,000
individuals. More than 21,000 of those individuals are joined in
lawsuits in Mississippi state courts. Hundreds of other
companies are also named as defendants in those suits.
According to the filing, while the company claims that it has
never manufactured asbestos and no longer uses it in its
products, some of its older products contained components
bearing asbestos. UTC said that the lawsuits don't identify
which of the Company's products are responsible for the alleged
damages, and the plaintiffs haven't specified the amounts of
damages they're seeking. The discovery process in some of the
asbestos lawsuits is getting underway, the Company said, "but to
date there has been only minimal product identification."
UTC is known for its well-known units, Carrier, Otis, Pratt &
Whitney, and Sikorsky. The Connecticut-based Company makes
building systems and aerospace products.
ASBESTOS LITIGATION: Widow To Sue Cape plc for Asbestos Disease
---------------------------------------------------------------
A woman whose husband and daughter died from asbestos-caused
cancer has been told she faces the same fate, BBC News reports.
Barbara Fitt's husband John and daughter Evelyn were both killed
by mesothelioma, a form of lung cancer that is linked to
asbestos exposure. Now Mrs. Fitt, 71, of Camberley, Surrey, has
contracted the same condition after allegedly breathing in
fibers brought home on her husband's work overalls.
The mother of two is to sue Cape building products in Uxbridge
where Mr. Fitt used to cut fireproof asbestos boards by hand as
a foreman, in the 1960s. "I used to help John pick the large
grains of asbestos off his skin," Mrs. Fitt told BBC News.
Her surviving daughter Yvonne Power, 49, worked as a quality
controller at the same firm and has been told she too may
contract the condition. The Fitt family was given compensation
for the deaths of Mr. Fitt in 1993 and of Evelyn, aged 45, in
1996. Mrs. Fitt's case is to be pursued by asbestos injuries
solicitor Adrian Budgen, who worked on both the family's
previous cases against Cape plc.
"I've dealt with instances where two people in the same family
have had the disease but never three affected in this way. It's
very, very unusual," Mr. Budgen told BBC News.
Most people diagnosed with mesothelioma die within two years
because it does not respond well to treatment. Mr. Budgen
further said, "They are a very loving, close-knit family.
devastated by this disease."
"Obviously we are extremely sorry to hear of this case and very
sad that the family has been subjected to this disease in such a
traumatic manner," a spokesman for Cape plc told BBC News.
ASBESTOS LITIGATION: Eastman Chem Settles Most Asbestos Claims
--------------------------------------------------------------
Eastman Chemical reports in its latest filing with the
Securities and Exchange Commission that it has settled more than
80% of its outstanding asbestos claims.
Eastman previously reported that more than 11,000 asbestos
claims had been filed against the company, with "by far, the
majority" of claims from Mississippi.
"We recently reached an agreement to resolve about 90% of the
claims in Mississippi," Eastman CFO Rich Lorraine said in an
investor conference call.
The resolved claims account for more than 80% of the overall
asbestos claims against the company, according to Lorraine.
ASBESTOS LITIGATION: Judge Won't Block Halliburton Asbestos Deal
----------------------------------------------------------------
A U.S. Bankruptcy Court judge recently ruled that insurance
companies lack standing to oppose the $4,100,000,000 settlement
of thousands of asbestos claims against Pittsburgh subsidiaries
of oil giant, Halliburton Co., the Pittsburgh Tribune Review
reports.
Judge Judith Fitzgerald heard arguments Jan. 13 on whether the
insurance companies could file motions to dismiss the
prepackaged settlements. She had taken the matter under
advisement at that time, the report said.
Fitzgerald said because Halliburton and its subsidiaries would
be making payments to the victims, "insurers are not affected
directly or indirectly," and cannot intervene.
Attorneys for more than 20 insurance carriers contended that
they have standing because they might have to cover billions of
dollars of asbestos claims.
ASBESTOS LITIGATION: Hercules Boosts Reserves, Profit Falls
-----------------------------------------------------------
The chemicals maker's quarterly profit fell 27 percent after it
increased reserves for future asbestos liability costs,
according to a report from Reuters.
Still, Hercules Inc. forecast sales, earnings and cash flow
would improve this year, despite higher energy and pension
costs, sending its shares up almost 4 percent.
The Wilmington, Delaware, company, posted fourth-quarter net
income of $8,000,000, or 8 cents per share, including a
$6,000,000 charge for asbestos reserves. A year earlier, profit
was $11,000,000, or 10 cents a share, the report said.
Before the charge, the company had a profit of 12 cents a share
and 18 cents from ongoing operations, matching the average
forecast of four analysts polled by Reuters Research, a unit of
Reuters Group Plc.
Hercules, whose products include water treatment chemicals, said
net sales rose 8 percent to $458,000,000, led by higher sales of
paint and ink materials.
Looking ahead, Hercules said its financial exposure to asbestos-
related matters could range from $220,000,000 to $675,000,000, a
forecast it called "reasonably possible."
Currently, its recorded liability for future asbestos costs was
increased to $221,000,000, with at least $169,000,000 of that
amount covered by insurance, it said.
ASBESTOS LITIGATION: Widow's Asbestos Suit Includes 28 Companies
----------------------------------------------------------------
A widow with four adopted children seeks compensation for the
death of her husband, who died of mesothelioma, reports Quad-
City Times.
Connie Smithiger's husband, Gerald 'Butch' Smithiger was a big
man at 6-feet-2 inches tall and weighing more than 300 pounds.
She said her husband had a personality to match his size.
Butch knew hundreds of people who rode with him on Davenport
city bus routes, she told Quad-City Times. He had friends from
working at the Salvation Army and friends from bowling and
shooting pool. He was father and grandfather to four dependent
children whom they adopted. The children are Connie's natural
grandchildren.
By winter 2002, four years after he became ill and three years
after he was diagnosed with malignant mesothelioma -- a rare
form of cancer related to exposure to asbestos -- Gerald
Smithiger died. He was a month past his 53rd birthday.
One of the best-known toxic tort law firms in the country is
working on Mrs. Smithiger's behalf. Texas-based Baron & Budd PC,
a firm that specializes in environmental tort cases, filed a
lawsuit in 2002 against 28 companies that may have been involved
in the production and sale of products containing asbestos that
Mr. Smithiger was exposed to during his work career in
Davenport.
Mrs. Smithiger's day in court is scheduled to come in October in
Georgia. The lawsuit seeks a maximum of $30,000,000 to
$15,000,000 in compensatory damages, $15,000,000 in punitive
damages -- for her family, the Iowa-based paper reports.
ASBESTOS ALERT: Boiler Cleaner's Death Deemed Asbestos-Related
--------------------------------------------------------------
A 71-year-old who worked as cleaner for British Railways
succumbed to mesothelioma, an asbestos-related industrial
disease, according to a report from the Medway Messenger.
Malcolm Dines of Pump Lane, Rainham, was exposed to asbestos
while cleaning out steam engine boilers and fireboxes at a
Gillingham depot.
Mid-Kent and Medway coroner Roger Sykes heard at the Gillingham
inquest that Mr. Dines would get covered in asbestos dust when
he had to climb inside the fireboxes of steam engines to clean
them.
The engine shed was hot and dusty because it did not have any
extraction fans, the inquest heard in a statement made by Mr.
Dines, shortly before he died on October 9.
Mr. Dines later became a fireman and then a train driver before
retiring, the report said.
New Securities Fraud Cases
AGCO CORPORATION: Federman & Sherwood Files Stock Lawsuit in IL
---------------------------------------------------------------
Federman & Sherwood initiated a securities class action against
AGCO Corporation (NYSE: AG) in the United States District Court
for the Northern District of Illinois. The suit also names as
defendants Robert J. Ratliff and Andrew H. Beck.
The complaint alleges violations of federal securities laws,
including allegations of improper recognition of revenue in the
financial statements included in certain public reports of the
Company between the dates of February 6, 2003 through February
5, 2004, whereby artificially inflating the price of the AGCO
securities.
For more details, contact William B. Federman by Mail: FEDERMAN
& SHERWOOD, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102
by Phone: (405) 235-1560 by Fax: (405) 239-2112 or by E-mail:
wfederman@aol.com
DATATEC SYSTEMS: Federman & Sherwood Lodges NJ Securities Suit
--------------------------------------------------------------
Federman & Sherwood initiated a securities class action against
Datatec Systems, Inc. (Nasdaq: DATCE) in the United States
District Court for New Jersey.
The complaint alleges violations of federal securities laws,
including allegations that Datatec's CEO Isaac Gaon falsely
reported to investors the Company's financial position and
continued to obtain financing from IBM Credit, an important
company lender. Datatec surprised investors when it announced
that CEO Gaon had been replaced with CEO Raul Pupo on December
5, 2003, and that an outside counsel was hired to review
Datatec's valuation of its long-term contracts. IBM Credit has
since refused to waive Datatec's non-compliance with financial
covenants.
For more details, contact William B. Federman by Mail: FEDERMAN
& SHERWOOD, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102
by Phone: (405) 235-1560 by Fax: (405) 239-2112 or by E-mail:
wfederman@aol.com
FRANKLIN RESOURCES: Federman & Sherwood Lodges Stock Suit in NV
---------------------------------------------------------------
Federman & Sherwood initiated a securities class action against
Franklin Resources, Inc. (NYSE: BEN) in the United States
District Court for Nevada against the Company.
The complaint alleges violations of federal securities laws,
including allegations of "timing" of the Funds' securities.
Timing is excessive, arbitrage trading of securities. The
complaint further alleges that Franklin Resources and its
affiliates allowed and facilitated timing activities in the
Funds, to the detriment of class members. These practices were
undisclosed in the prospectuses of the Funds, which falsely
represented that the Funds actively police against timing. The
class period is from February 6, 1999 through February 4, 2004.
For more details, contact William B. Federman by Mail: FEDERMAN
& SHERWOOD, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102
by Phone: (405) 235-1560 by Fax: (405) 239-2112 or by E-mail:
wfederman@aol.com
FRANKLIN RESOURCES: Cauley Geller Launches Securities Suit in AZ
----------------------------------------------------------------
Cauley Geller Bowman & Rudman, LLP initiated a securities class
action in the United States District Court for the District of
Nevada on behalf of all purchasers of shares of the Franklin
Family of Mutual Funds (the "FT Funds") which are managed by
Franklin Resources, Inc. (NYSE: BEN) during the period between
February 6, 1999 and February 4, 2004, inclusive.
The Funds, and the symbols for the respective Funds named below,
are as follows:
(1) Franklin AGE High Income Fund AGEFX, FAHAX,
FHIBX, FRAIX, FAHRX
(2) Franklin Adjustable U.S. Government Securities Fund
FISAX, FCSCX
(3) Franklin Aggressive Growth Fund FGRAX, FRAAX, FKABX,
FKACX, FKARX
(4) Franklin Alabama Tax-Free Income Fund FRALX, FALEX
(5) Franklin Arizona Tax-Free Income Fund FTAZX, FBAZX,
FAZIX
(6) Franklin AGE High Income Fund AGEFX, FAHAX, FHIBX,
FRAIX, FAHRX
(7) Franklin Adjustable U.S. Government Securities Fund
FISAX, FCSCX
(8) Franklin Aggressive Growth Fund FGRAX, FRAAX, FKABX,
FKACX, FKARX
(9) Franklin Alabama Tax-Free Income Fund FRALX, FALEX
(10) Franklin Arizona Tax-Free Income Fund FTAZX, FBAZX,
FAZIX
(11) Franklin Balance Sheet Investment Fund FRBSX, FBSAX,
FBSBX, FCBSX, FBSRX
(12) Franklin Biotechnology Discovery Fund FBDIX
(13) Franklin Blue Chip Fund FKBCX, FKBBX, FBCCX,
FBCRX
(14) Franklin California High Yield Municipal Fund FCAMX,
FBCAX, FCAHX
(15) Franklin California Insured Tax-Free Income Fund FRCIX,
FRCBX, FRCAX
(16) Franklin California Intermediate-Term Tax-Free Income
Fund FKCIX
(17) Franklin California Limited Term Tax-Free Income Fund
(18) Franklin California Tax-Exempt Money Fund FCLXX
(19) Franklin California Tax-Free Income Fund FKTFX, FCAVX,
FCABX, FRCTX
(20) Franklin Capital Growth Fund FKREX, FEACX,
FKEQX, FREQX, FKIRX
(21) Franklin Colorado Tax-Free Income Fund FRCOX, FCOIX
(22) Franklin Connecticut Tax-Free Income Fund FXCTX, FCTIX
(23) Franklin Convertible Securities Fund FISCX, FROTX
(24) Franklin Double Tax-Free Income Fund FPRTX, FPRIX
(25) Franklin DynaTech Fund FKDNX, (Nasdaq: FDNBX, FDYNX
(26) Franklin Equity Income Fund FISEX, FBEIX,
FRETX, FREIX
(27) Franklin Federal Intermediate-Term Tax-Free Income Fund
FKITX
(28) Franklin Federal Limited Term Tax-Free Income Fund
FFTFX
(29) Franklin Federal Money Fund FMNXX
(30) Franklin Federal Tax-Free Income Fund FKTIX, FAFTX,
FFTBX, FRFTX
(31) Franklin Flex Cap Growth Fund FKCGX, FKCBX,
FCIIX, FRCGX
(32) Franklin Floating Rate Daily Access Fund FAFRX, FBFRX,
FCFRX
(33) Franklin Floating Rate Trust XFFLX
(34) Franklin Florida Insured Tax-Free Income Fund FFLTX
(35) Franklin Florida Tax-Free Income Fund FRFLX, FRFBX,
FRFIX
(36) Franklin Georgia Tax-Free Income Fund FTGAX, FGAIX
(37) Franklin Global Aggressive Growth Fund
(38) Franklin Global Communications Fund FRGUX
(39) Franklin Global Growth Fund
(40) Franklin Global Health Care Fund FKGHX, FGHBX,
FGIIX
(41) Franklin Gold and Precious Metals Fund FKRCX, FGADX,
FAGPX, FRGOX
(42) Franklin Growth Fund FKGRX, FCGAX, FKGBX,
FRGSX, FGSRX
(43) Franklin High Yield Tax-Free Income Fund FRHIX, FYIBX,
FHYIX
(44) Franklin Income Fund FKINX, FRIAX, FBICX,
FICBX, FCISX, FISRX
(45) Franklin Insured Tax-Free Income Fund FTFIX, FBITX,
FRITX
(46) Franklin Kentucky Tax-Free Income Fund FRKYX
(47) Franklin Large Cap Growth Fund FKGAX, FRGAX,
FKGCX, FRLGX
(48) Franklin Large Cap Value Fund FLVAX, FBLCX,
FLCVX, FLCRX
(49) Franklin Louisiana Tax-Free Income Fund FKLAX, FLAIX
(50) Franklin Maryland Tax-Free Income Fund FMDTX, FMDIX
(51) Franklin Massachusetts Insured Tax-Free Income Fund
FMISX, FMAIX
(52) Franklin Michigan Insured Tax-Free Income Fund FTTMX,
FBMIX, FRMTX
(53) Franklin MicroCap Value Fund FRMCX
(54) Franklin Minnesota Insured Tax-Free Income Fund FMINX,
FMNIX
(55) Franklin Missouri Tax-Free Income Fund FRMOX, FMOIX
(56) Franklin Money Fund FMFXX
(57) Franklin Natural Resources Fund FRNRX, FNRAX
(58) Franklin New Jersey Tax-Free Income Fund FRNJX,
FNJBX, FNIIX
(59) Franklin New York Insured Tax-Free Income Fund FRNYX,
FNYKX
(60) Franklin New York Intermediate-Term Tax-Free Income
Fund FKNIX
(61) Franklin New York Limited Term Tax-Free Income Fund
(62) Franklin New York Tax-Exempt Money Fund FRNXX
(63) Franklin New York Tax-Free Income Fund FNYTX, FNYAX,
FTFBX, FNYIX
(64) Franklin North Carolina Tax-Free Income Fund
FXNCX,
(Nasdaq: FNCIX)
(65) Franklin Ohio Insured Tax-Free Income Fund FTOIX,
FBOIX, FOITX
(66) Franklin Oregon Tax-Free Income Fund FRORX, FORIX
(67) Franklin Pennsylvania Tax-Free Income Fund FRPAX,
FBPTX, FRPTX
(68) Franklin Real Estate Securities Fund FREEX, FRLAX,
FBREX, FRRSX
(69) Franklin Rising Dividends Fund FRDPX, FRDBX,
FRDTX, FRDRX
(70) Franklin Short-Intermediate U.S. Government Securities
Fund FRGVX, FSUAX
(71) Franklin Small Cap Growth Fund II FSGRX, FSSAX,
FBSGX, FCSGX, FSSRX
(72) Franklin Small Cap Value Fund FRVLX, FVADX,
FBVAX, FRVFX, FVFRX
(73) Franklin Small-Mid Cap Growth Fund FRSGX, FSGAX,
FBSMX, FRSIX, FSMRX
(74) Franklin Strategic Income Fund FRSTX, FKSAX,
FKSBX, FSGCX), FKSRX
(75) Franklin Strategic Mortgage Portfolio FSMIX
(76) Franklin Tax-Exempt Money Fund FTMXX
(77) Franklin Technology Fund FTCAX, FRTCX,
FFTCX, FTERX
(78) Franklin Templeton Conservative Target Fund FTCIX,
FTCCX, FTCRX
(79) Franklin Templeton CoreFolio Allocation Fund FTCOX
(80) Franklin Templeton Founding Funds Allocation Fund
FFALX, FFABX, FFACX
(81) Franklin Templeton Growth Target Fund FGTIX, FTGTX,
FGTRX
(82) Franklin Templeton Hard Currency Fund ICPHX
(83) Franklin Templeton Moderate Target Fund FMTIX, FTMTX,
FTMRX
(84) Franklin Templeton Money Fund FMBXX, FRIXX,
FMRXX
(85) Franklin Tennessee Municipal Bond Fund FRTIX
(86) Franklin Texas Tax-Free Income Fund FTXTX, FTXIX
(87) Franklin Total Return Fund FKBAX, FBDAX,
FBTLX, FCTLX, FTRRX
(88) Franklin U.S. Government Securities Fund FKUSX, FUSAX,
FUGBX, FRUGX, FUSRX
(89) Franklin U.S. Long-Short Fund FUSLX
(90) Franklin Utilities Fund FKUTX, FRUAX,
FRUBX, FRUSX, FRURX
(91) Franklin Virginia Tax-Free Income Fund FRVAX, FVAIX
(92) Templeton China World Fund TCWAX, TACWX
(93) Templeton Developing Markets Trust TEDMX, TDADX,
TDMBX, TDMTX, TDMRX
(94) Templeton Foreign Fund TEMFX, TFFAX, TFRBX,
TEFTX, TEFRX
(95) Templeton Foreign Smaller Companies Fund FINEX,
FTFAX, FCFSX
(96) Templeton Global Bond Fund TPINX, TGBAX,
TEGBX
(97) Templeton Global Long-Short Fund TLSAX, TLSBX
(98) Templeton Global Opportunities Trust TEGOX, TEGPX
(99) Templeton Global Smaller Companies Fund, Inc. TEMGX,
TGSAX, TESGX
(100) Templeton Growth Fund, Inc. TEPLX, TGADX,
TMGBX, TEGTX, TEGRX
(101) Templeton International (Ex EM) Fund TEGEX, TGEFX
(102) Templeton Latin America Fund TELAX, TLAAX,
TLAIX
(103) Templeton Pacific Growth Fund FKPGX, FPGCX
(104) Templeton World Fund TEMWX, TWDBX, TEWTX
(105) Mutual Beacon Fund TEBIX, TEBBX, TEMEX,
BEGRX
(106) Mutual Discovery Fund TEDIX, TEDBX, TEDSX,
TEDRX, MDISX
(107) Mutual European Fund TEMIX, TEUBX, TEURX,
MEURX
(108) Mutual Financial Services Fund TFSIX, TBFSX,
TMFSX, TEFAX
(109) Mutual Qualified Fund TEQIX, TEBQX, TEMQX,
MQIFX
(110) Mutual Recovery Fund FMRVX
(111) Mutual Shares Fund TESIX, FMUBX, TEMTX,
TESRX, MUTHX
The complaint charges Franklin Resources, Inc., Franklin
Advisers, Inc., Franklin/Templeton Distributors, Inc.,
Templeton/Franklin Investment Services, Inc., Franklin Private
Client Group, Inc., and FT Funds, among others, with violations
of the Securities Act of 1933 (the "Securities Act"), the
Securities Exchange Act of 1934 (the "Exchange Act"), among
other claims, and for common law breach of fiduciary duties.
According to the Complaint, FT Funds, Franklin Resources, Inc.,
defendant Daniel G. Calugar ("Calugar") and his broker-dealer,
Security Brokerage, Inc. (collectively the "Calugar defendants")
and other defendants engaged in illegal and improper trading
practices, in concert with certain institutional traders, which
caused financial injury to all shareholders of the FT Funds. In
particular, the Defendants surreptitiously permitted certain
favored investors, including the Calugar defendants and others
to engage in "timing" of the FT Mutual Funds whereby these
favored investors were permitted to conduct short-term, "in and
out" trading of mutual fund shares, despite explicit
restrictions on such activity in the FT Mutual Funds
prospectuses.
For more details, contact Samuel H. Rudman, David A. Rosenfeld,
Jackie Addison, Heather Gann or Chandra West 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
HOLLINGER INTERNATIONAL: Federman & Sherwood File IL Stock Suit
---------------------------------------------------------------
Federman & Sherwood initiated a securities class action against
Hollinger International, Inc. (NYSE: HLR) in the United States
District Court for the Northern District of Illinois.
The suit alleges that throughout the Class Period of August 13,
1999 through March 31, 2003, the Company violated sections
10(b), 18 and 20(a) of the Securities Exchange Act of 1934 and
Rule 10b-5 promulgated thereunder by the Securities and Exchange
Commission (SEC) by issuing a series of material
misrepresentations to the market during the Class Period. The
lawsuit further alleges violations of the Illinois Securities
Law of 1953, breaches of fiduciary duties, and aiding and
abetting the breaches of fiduciary duties.
For more details, contact William B. Federman by Mail: FEDERMAN
& SHERWOOD, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102
by Phone: (405) 235-1560 by Fax: (405) 239-2112 or by E-mail:
wfederman@aol.com
IBIS TECHNOLOGY: Wolf Haldenstein Lodges Securities Suit in MA
--------------------------------------------------------------
Wolf Haldenstein Adler Freeman & Herz LLP filed a securities
class action in the United States District Court for the
District of Massachusetts, on behalf of all persons who
purchased the common stock of Ibis Technology Corporation
(Nasdaq: IBIS) between October 2, 2003 and December 12, 2003,
inclusive, against the Company and Martin J. Reid, Chief
Executive Officer, President, and Chairman of the Board of Ibis
during the Class Period. The case name is Harrison v. Ibis
Technology Corp., et al.
During the Class Period, defendants issued numerous statements
concerning Ibis' business and financial results. These positive
representations were materially false and misleading because
defendants failed to disclose and misrepresented the following
material adverse facts:
(1) that demand for Ibis 200 mm and smaller size wafers was
in dramatic decline and that its major customer, IBM,
who accounted for virtually all of such product
revenues, would purchase only approximately $1 million
of such product in Q4 2003, compared to $2.7 million in
purchases of such product in Q4 2002;
(2) that because of the facts alleged in subparagraph (a)
above and the known reduction in demand in the
marketplace for the 200 mm and smaller size wafers, as
alleged above, Ibis would be required under GAAP to
write down in material amount the value of the 200 mm
and smaller size wafer production line it carried on
its financial statements;
(3) that Ibis had not agreed upon the terms and conditions
of a licensing agreement with IBM with respect to IBM's
patented technology used by Ibis in the manufacture of
the i2000 implanter, and upon which the i2000 was
dependent, that Ibis was involved in negotiations with
IBM and that defendants were not in any position to
know if and when it and IBM would agree on the terms
and conditions of a licensing agreement;
(4) that until Ibis and IBM had agreed upon the terms and
conditions of a licensing agreement and any potential
purchaser of the i2000 implanter agreed with IBM to the
terms of the licensing agreement, defendants were not
able to close on the sale of its i2000 implanter to any
purchaser other than IBM, which had not ordered any
additional i2000 implanters;
(5) that defendants lacked any reasonable basis for their
statements to the market that the orders Ibis had
received for one to three i2000 implanters from
Japanese wafer manufacturers would close by December
31, 2003, in light of the facts alleged in
subparagraphs (c) and (d) herein. In addition,
defendants knew that there was a substantial
probability that those orders would be withdrawn
pending the Japanese purchasers' decisions whether and
when to agree to the terms of any licensing agreement
that Ibis might enter into with IBM; and
(6) that as a result of the foregoing, defendants lacked a
reasonable basis for their statements made during the
Class Period concerning the Company's prospects,
earnings and value, as alleged hereinafter.
On December 15, 2003, defendants filed a Form 8-K with the SEC
admitting that there would be no sales of i2000 implanters in Q4
2003 to the Japanese wafer manufacturers and that they now
expected to receive order(s) for one to three i2000 implanters
sometime in 2004 but that the timing of the orders "is very
difficult to predict because the sales require the purchaser to
enter into a license agreement with a third party" whose name,
although not disclosed by defendants, is IBM.
For more details, contact Fred Taylor Isquith, Gregory M.
Nespole, Christopher S. Hinton, George Peters, or Derek Behnke
by Mail: 270 Madison Avenue, New York, New York 10016, by Phone:
(800) 575-0735 by E-mail: classmember@whafh.com or visit the
firm's Website: http://www.whafh.com. All e-mail correspondence
should make reference to Ibis.
MOBILITY ELECTRONICS: Charles Piven Files Securities Suit in AZ
---------------------------------------------------------------
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 Mobility
Electronics, Inc. (NasdaqNM:MOBE) between September 2, 2003 and
January 5, 2004, inclusive. The case is pending in the United
States District Court for the District of Arizona against
Mobility Electronics, Inc. and certain of its officers and
directors.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the Class Period which
statements had the effect of artificially inflating the market
price of the Company's securities.
For more details, contact Charles J. Piven by Mail: The World
Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phone: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
MOBILITY ELECTRONICS: Brian Felgoise Files Securities Suit in AZ
----------------------------------------------------------------
The Law Offices of Brian M. Felgoise, P.C. initiated a
securities class action on behalf of shareholders who acquired
Mobility Electronics, Inc. (NasdaqNM:MOBE) securities between
September 2, 2003 and January 5, 2004, inclusive. The case is
pending in the United States District Court for the District of
Arizona, against the company and certain key officers and
directors.
The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities.
For more details, contact Brian M. Felgoise by Mail: 261 Old
York Road, Suite 423, Jenkintown, Pennsylvania 19046 by Phone:
(215) 886-1900 or by E-mail: FelgoiseLaw@aol.com
REDBACK NETWORKS: Bernstein Liebhard Files Securities Suit in CA
----------------------------------------------------------------
Bernstein Liebhard & Lifshitz LLP initiated a securities class
action in the United States District Court for the Northern
District of California on behalf of all persons who purchased or
acquired securities of Redback Networks, Inc. (NasdaqNM:RBAKQ)
between April 12, 2000 through October 10, 2003, inclusive.
The complaint charges Joel M. Arnold, Thomas L. Cronan III,
Kevin A. DeNuccio, Peter Lamond, Vinod Khosla, Vivek Ragavan,
and Dennis P. Wolf with violations of Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder.
The Complaint alleges that, throughout the Class Period,
defendants failed to disclose the following adverse facts which
ultimately lead to Redback's bankruptcy:
(1) that the Company's financial results were materially
inflated because Redback entered into a sales pact with
Qwest Communications, Inc. ("Qwest");
(2) that this sales pact with Qwest called for Qwest to
purchase large quantities of Redback merchandise in
exchange for shares of Redback stock;
(3) that under this sales pact Qwest had no obligation to
purchase more merchandise from Redback in the future;
and
(4) as a result of this sales, Redback materially
overstated and artificially inflated its earnings and
net income.
On October 10, 2003, Redback announced, after the close of the
market, that the Securities and Exchange Commission ("SEC") was
investigating various transactions between the Company and
Qwest. News of this shocked the market, with shares of Redback
falling 7.1% to close at $0.51 per share on October 13, 2003.
The death null for the Company was finally sounded when on
November 3, 2003, Redback filed for Chapter 11 bankruptcy
protection. On news of this, shares of Redback fell 18.18% to
close at $0.36 per share and are now worthless.
For more details, contact Shareholder Relations Department by
Mail: Bernstein Liebhard & Lifshitz, LLP, 10 East 40th Street,
New York, New York 10016 by Phone: (800) 217-1522 or
(212) 779-1414 or by E-mail: RBAKQ@bernlieb.com.
WAVE SYSTEMS: Federman & Sherwood Launches Securities Suit in NJ
----------------------------------------------------------------
Federman & Sherwood initiated a securities class action against
Wave Systems Corporation (Nasdaq: WAVX) and individual
defendants in the United States District Court for New Jersey on
behalf of purchasers of the Company's stock for the class period
of August 4, 2003 through December 18, 2003.
The complaint alleges violations of federal securities laws,
including allegations that materially false and misleading
statements were issued by the Company during the class period,
artificially inflating the price of the WAVX securities.
Plaintiff seeks to recover damages on behalf of the Class.
For more details, contact William B. Federman by Mail: FEDERMAN
& SHERWOOD, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102
by Phone: (405) 235-1560 by Fax: (405) 239-2112 or by E-mail:
wfederman@aol.com
WINN-DIXIE STORES: Rabin Murray Lodges Securities Lawsuit in FL
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Rabin Murray and Frank, LLP initiated a securities class action
in the United States District Court for the Middle District of
Florida on behalf of all persons or entities who purchased or
otherwise acquired Winn-Dixie Stores, Inc. securities (NYSE:WIN)
during the period from May 6, 2002 to January 29, 2004, both
dates inclusive. The Complaint names as defendants the Company
and:
(1) Allen R. Rowland,
(2) Frank Lazaran,
(3) Richard P. McCook, and
(4) D. Michael Byrum
The Complaint alleges that defendants violated section 10(b) of
the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder by the Securities and Exchange Commission. In
particular, the Complaint alleges that defendants failed to
disclose and/or misrepresented the following adverse facts,
among others:
(i) that Winn- Dixie's business operations were mismanaged
and burning cash such that the Company was unable to
reduce excess expenses when needed;
(ii) that the Company had no such strategic vision in place
to enhance shareholder value and thus would not be able
to sustain dividend payments to shareholders;
(iii) that the Company was unable to competitively market its
Winn-Dixie product brand;
(iv) that Winn-Dixie was unable to gain a greater market
share for its supermarkets;
(v) that the loss of Canadian Imperial Bank of Commerce
automated teller machines (``ATMs'') would result in a
decline in sales in stores that had these ATMs; and
(vi) that the Company recorded the carrying value of its
durable assets at inflated levels and maintained
inadequate reserves for self-insurance.
On January 30, 2004, Winn-Dixie announced net losses from sales
and operations for its second quarter of fiscal 2004. The
Company also announced major new initiatives designed to improve
competitive market position and profitability and announced that
it had to take an asset impairment charge of $36.4 million and
an increase in self-insurance reserves of $21.4 million. News of
this shocked the market. Shares of Winn-Dixie dropped 27.8%, or
$2.53 per share, to close at $6.56 on January 30, 2004 on
extremely heavy volume.
For more details, contact Eric J. Belfi or Aaron D. Patton by
Phone: (800) 497-8076, (212) 682-1818 by Fax: (212) 682-1892 or
by E-mail: Info@rabinlaw.com
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Copyright 2004. All rights reserved. ISSN 1525-2272.
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