/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/040628.mbx C L A S S A C T I O N R E P O R T E R Monday, June 28, 2004, Vol. 6, No. 126 Headlines AMC ENTERTAINMENT: DC Court Approves Settlement of ADA Lawsuit ANTI-SPAM: AOL Employee Nabbed For Selling 92M-Customer List AYLMER MEAT: Employees File Civil Rights Suit V. OPP, Government BRISTOL-MYERS: AR Agencies Receive $782,000 Antitrust Settlement CANADA: Walkerton Residents Rail V. Overseer's $11.2M Charge FAIRPAX.COM: SEC Obtains Emergency Relief V. Fraudulent Web Site FFE TRANSPORTATION: OOIDA Backs Member's Class Arbitration Bid FIDELITY NATIONAL: Former Director Faces CA Insider Trading Suit GLOBAL CROSSING: NY Court Refuses To Dismiss Lawsuit V. Execs GREAT ATLANTIC: Former Employees File Overtime Suit in NY Court LOCAL 28: Minority Workers Ask Court To Hold Union in Contempt NEOPHARM: SEC Issues Subpoena Over Arbitrations, Resignations TOBACCO LITIGATION: AMA Supports $145B Damages in Engle Suit UNIVERSITY OF IOWA: University Employees To Join Parental Suit WAL-MART STORES: Lawyers Say Evidence Proves Execs Knew of Bias New Securities Fraud Cases 99 CENTS: Schiffrin & Barroway Launches Securities Suit in CA BISYS GROUP: Bernstein Liebhard Files Securities Suit in S.D. NY HANGER ORTHOPEDIC: Geller Rudman Lodges Securities Lawsuit in VA HANGER ORTHOPEDIC: Charles J. Piven Lodges Securities Suit in NY HANGER ORTHOPEDIC: Brodsky & Smith Lodges Securities Suit in PA KEY ENERGY: Berger & Montague Lodges Securities Suit in W.D. TX MERIX CORPORATION: Milberg Weiss Lodges Securities Lawsuit in OR MERIX CORPORATION: Lerach Coughlin Lodges Securities Suit in OR NBTY INC.: Paskowitz & Associates Lodges Securities Suit in NY OMNIVISION TECHNOLOGIES: Weiss & Yourman Files CA Stock Suit SHAW GROUP: Schiffrin & Barroway Lodges Securities Suit in LA VASO ACTIVE: Marc Henzel Files MA Securities Fraud Suit VICURON PHARMACEUTICALS: Marc Henzel Files Securities Suit in PA VICURON PHARMACEUTICALS: Brodsky & Smith Lodges PA Stock Suit WINN-DIXIE STORES: Marc Henzel Lodges Securities Suit in M.D. FL ********* AMC ENTERTAINMENT: DC Court Approves Settlement of ADA Lawsuit -------------------------------------------------------------- The United States District Court for the District of Columbia approved the settlement of the class action filed against AMC Entertainment, Inc., on behalf of hearing impaired persons, styled "Kevin Ball, et al. v. AMC Entertainment, Inc. and Loews Cineplex Entertainment Corp. (Case No.1:00CV00867)." The suit involves theatres only in the District of Columbia area. The suit sought to have the Company install closed- captioning in several screens at several theatres in the D.C. area, which the Company estimated would cost approximately $96,000 in the aggregate. The Company and Loews have each agreed to a settlement that would require the installation of closed-captioning in six theatre screens in the D.C. area and the payment by each of the Company and Loews of approximately $130,000 for plaintiff's legal fees. The suit, styled "Kevin Ball, et al. v. AMC Entertainment, Inc. and Loews Cineplex Entertainment Corporation, Case No.1:00CV00867, was filed under Judge Gladys Kessler of the United States District Court for the District of Columbia. The lead plaintiffs for the suit are Kevin Ball, Aaron Fudenske and John Stanton. Laywers for the plaintiffs are Thomas J. Simeone, Esq. of SIMEONE & MILLER, 1620 I Street, NW, Suite 202, Washington, DC 20006 and David Monroe, Esq., of GALLAND KHARASCH GREENBERG FELLMAN & SWIRSKY, P.C., 1054 31st Street, NW Washington, DC 20007-4402. ANTI-SPAM: AOL Employee Nabbed For Selling 92M-Customer List ------------------------------------------------------------ Federal investigators arrested an America Online (AOL) employee and a Las Vegas Internet marketer, after they stole the Internet provider's 92 million-customer list and sold it to a "spammer," Reuters reports. AOL members filed a criminal complaint in the United States District Court in New York, after they were flooded with millions of unwanted messages because of the scheme. In connection with the suit, federal investigators arrested Jason Smathers, 24, an engineer in AOL's Dulles, Virginia, headquarters. Mr. Smathers was able to access screen names, zip codes and credit-card types, though not credit-card numbers, of the company's 30 million customers. Mr. Smathers sold the list to Internet marketer Sean Dunaway of Las Vegas. Mr. Dunaway has also been arrested after he used the list to promote his online gambling operation and sold it to other spammers, U.S. attorney David Kelley said in a statement, according to a Reuters report. Mr. Dunaway, 21, sold the list to other marketers for $52,000 in May or June 2003, and sold an updated version in March 2004 for $32,000, the complaint asserted. He paid Mr. Smathers $100,000 for the updated list. AOL discovered the activity during a spam investigation this year. The Company has fired the spammers, and expressed "deep regret" at what happened. "We . are thoroughly reviewing and strengthening our internal procedures as a result of this investigation and arrest," the company said in a statement. Both men face up to five years in prison and a fine of $250,000 under a national anti-spam law. Neither could be immediately reached for comment, Reuters states. AYLMER MEAT: Employees File Civil Rights Suit V. OPP, Government ---------------------------------------------------------------- Former workers at Aylmer Meat Packers in Canada filed a class action against the Ontario Government and the Ontario Provincial Police (OPP), accusing them of violating their rights when the OPP illegally arrested and detained them for five hours during an August 21, 2003 raid, the London Free Press reports. The authorities raided the abbatoir on allegations that they were processing "deadstock" or animals that died before slaughter, sometimes from illness. It is illegal to sell or process meat from dead animals for human consumption. The authorities shut down the slaughterhouse after the raid. The former employees' statement of claim alleges that the OPP arrested and detained them but didn't tell them the reason why or inform them of their right to seek counsel. The OPP also allegedly overstepped the scope of a search warrant by cutting open employee lockers and seizing personal items. After the raid, the OPP and officials with Ontario's Agriculture and Natural Resources ministries allegedly systematically threatened and humiliated workers during interviews. According to the London Free Press, the suit further alleged that: (1) Investigators with the Natural Resources Ministry were determined to find a way to limit the size and influence of the slaughterhouse, giving false and/or inaccurate information based on untested, second-hand information; (2) Government officials suspended operations of the plant without stating their reasons and never held a hearing afterward as required by law A lawyer for the former employees, Jonathan Foreman, told the London Free Press he soon would file motions asking a court to certify the lawsuit as a class action and to select a site for a potential trial. The suit names two former employees to represent the class, one from London, the other from Tillsonburg. The suit is the second suit filed against the officials who closed the abattoir. Earlier this year, plant owner Butch Clare launched a multimillion-dollar action. Government officials contacted yesterday weren't aware of the second suit, which has been filed in court but not served on defendants, the London Free Press reports. The OPP has been investigating the company since last summer after allegations the plant sneaked in animals at night that died before they arrived at the slaughterhouse. Aylmer Meat has denied the allegations. "I don't know when the investigation will be concluding," OPP spokesperson Bill Crate told The London Free Press. "Hopefully sooner rather than later." BRISTOL-MYERS: AR Agencies Receive $782,000 Antitrust Settlement ---------------------------------------------------------------- Leaders at an Arkansas state-run UAMS Medical Center are planning how to spend more than $540,000 from an antitrust case settlement by Bristol-Myers Squibb, the Obesity, Fitness & Wellness Week reports. The UAMS Medical Center was among three state agencies that received refunds in a class-action lawsuit against the pharmaceutical company, claiming it overcharged for a drug used in cancer chemotherapy. The $541,495 settlement for the medical center was the largest per-capita award for a state hospital from the company. Officials credit the amount to a careful review of receipts. In addition, the state Department of Human Services Division of Medical Services won $175,443 and the Arkansas Employee Benefits Division received $64,976. Bristol-Myers sent refunds to organizations and individuals claiming they paid too much for the drug Taxol. The company was accused of antitrust violations after it tried to keep competition out of the market for Taxol and two other products. Knowing it would lose its patent, the company filed new patents and lawsuits to stall the sales of cheaper generic brands. "When you're fighting for your life in an attack of cancer, the last thing you need to be worried about is whether you can afford the drug," said Attorney General Mike Beebe in announcing the refunds June 9, 2004, at a news conference at UAMS. Refunds also are expected in a similar lawsuit regarding Bristol-Myers' anti-anxiety medication BuSpar. In addition, Bristol-Myers is a defendant in lawsuits regarding its diabetes drug Glucophage. CANADA: Walkerton Residents Rail V. Overseer's $11.2M Charge ------------------------------------------------------------ Residents and officials of Walkerton, Canada protested over the $11.2 million charge presented by Crawford Adjusters Canada, the court-appointed overseer for the water contamination compensation scheme for lawsuit filed over the E. coli contamination of tap water in the Walkerton area in May 2000, CBC News Online reports. Approximately 2,500 people fell ill and seven died when they were stricken with E. coli from contaminated drinking water. Residents filed a class action against the government, which later formulated a compensation plan to settle the suit, an earlier Class Action Reporter story (February 27,2004) reports. More than 10,000 individuals have filed more than 17,000 separate compensation claims under the scheme. Some 7,600 people have so far received an average of $6,300 each - most of it paid by provincial taxpayers. The scheme has paid out about $49 million in compensation over three years. The overseer asserted that the fees were reasonable given the amount of work that went into running the scheme. Crawford has received $8.1 million over three years in administration charges, and a further $3.1 million in other service costs. Crawford has also had to deny accusations it was delaying individual compensation cases in order to draw out the lucrative work it is doing. Lawyer Randy Bennett, appointed in March 2001 by the Ontario Superior Court to help Justice Warren Winkler oversee the compensation plan, told CBC News Online all fees were based on a court-approved schedule. While the fees might appear excessive at first glance, they were subject to both court approval and an external audit, he said. "I don't think you can say $8 million isn't a big number, (but) based on the work that's been done so far, the amount expended on fees is reasonable . There's an awful lot of work that's going into assessing these claims prior to compensation being paid," he explained. Bruce Davidson, who acts as a community liaison with the court overseeing the scheme, told CBC News Online, "It's sort of a ball of numbers that is coming out and people are going 'What the hell is that for?'" FAIRPAX.COM: SEC Obtains Emergency Relief V. Fraudulent Web Site ---------------------------------------------------------------- The Securities and Exchange Commission today announced that on June 21, it obtained a temporary restraining order and asset freeze to halt fraudulent activity by a Web site, FairPax.com, that impersonated a New Hampshire mutual fund complex and promised investors returns of 657% per year. According to the Commission's complaint, the fraudulent FairPax.com, FairPax, Inc., and the unidentified individuals operating the Web site referred to as John Does 1-5 (FairPax) misappropriated descriptions of the purported mutual funds offered from a registered New Hampshire-based mutual fund, Pax World Funds. The Commission's complaint further alleges that the purported socially responsible high yield mutual fund FairPax offered is fraudulent and has not been registered with the Commission, as required. The Commission's complaint alleges that FairPax violated anti- fraud provisions of the federal securities laws, specifically Sections 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission also alleged that FairPax violated the registration provisions of the securities laws, namely Sections 5(a) and 5(c) of the Securities Act of 1933. It seeks an order permanently enjoining the defendants from violating these provisions, and requiring that the defendants disgorge funds received from investors and pay a civil monetary penalty. The suit is styled "SEC v. FairPax.com, FairPax, Inc. and John Does 1-5 [United States District Court for the District of New Hampshire, Civil Action No. 04-228-JD]." FFE TRANSPORTATION: OOIDA Backs Member's Class Arbitration Bid -------------------------------------------------------------- The Owner-Operator Independent Drivers Association (OOIDA) expressed support for one of its members in his demand for class arbitration against FFE Transportation Services, Inc., Truckinginfo.com reports. OOIDA member Levi Thornberry filed the demand against the Dallas-based carrier for alleged violations of truth-in-leasing regulations relating to compensation, charge backs and the purchase of fuel and other goods and services. The OOIDA has argued consistently that clauses in lease agreements requiring arbitration of disputes were simply an attempt to avoid class actions and has prevailed in several other cases where carriers sought to require arbitration of owner-operator claims, Truckinginfo.com reports. Last year, the U.S. Supreme Court ruled that arbitrators have the authority to certify classes, and the American Arbitration Assn. subsequently established procedural rules for bringing class arbitrations. Arbitration requires that disputes be submitted to an impartial person or persons, well versed in the subject matter of the dispute, for final and binding determination. OOIDA President Jim Johnston said the recommendation to pursue the FFE complaint through class wide arbitration doesn't signal a softening of their reliance on the federal court system. "We feel these new developments within the arbitration mechanism may now give owner-operators another alternative to seek relief for their claims against unscrupulous carriers," he told Truckinginfo.com. "In fact, class wide arbitration has the potential to allow a greater number of these disputes to be addressed, more quickly and with lower costs than the court system allows." FIDELITY NATIONAL: Former Director Faces CA Insider Trading Suit ---------------------------------------------------------------- The Securities and Exchange Commission filed an insider trading case in the United States District Court for the Central District of California against J. Thomas Talbot (Talbot), a businessman in Orange County, California, and a former director of Fidelity National Financial Inc. (Fidelity), a public company traded on the New York Stock Exchange. The Complaint alleges that in April 2003, Mr. Talbot bought stock in LendingTree, Inc. (LendingTree), after learning at a meeting of the Fidelity Board of Directors that LendingTree would be acquired by another company. According to the Complaint, on April 22, 2003, at a Fidelity Board Meeting, Fidelity's chief executive officer (CEO) told Talbot and other Fidelity board members that LendingTree would soon be acquired by another company at a significant premium over its then-current trading price. At the time of the meeting, Fidelity owned 12% of LendingTree. At the Fidelity Board meeting, the Complaint alleges, Talbot heard the CEO's comments about the potential acquisition, and wrote "LendingTree" on the top of his meeting agenda. These words constituted the only notes that Talbot made during the four-hour Board meeting. The Complaint alleges that after this information was conveyed to the Board of Directors, a Fidelity Board member cautioned the directors not to trade in LendingTree securities because they had been provided with confidential information. The Complaint alleges that two days after the Board meeting, however, Talbot breached the fiduciary duty he owed to Fidelity and purchased 5,000 shares of LendingTree common stock at $13.50 per share on the basis of the material, non-public information he misappropriated from Fidelity. According to the Complaint, Talbot similarly purchased an additional 5,000 shares of LendingTree at $14.50 per share on April 30, 2003. The Complaint further alleges that on May 5, 2003, the day that USA Interactive announced that it would acquire LendingTree, Talbot sold his 10,000 shares of LendingTree stock, realizing illicit profits of $67,881.20. The Complaint alleges that by engaging in the foregoing conduct, Talbot violated Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. The Commission's Complaint seeks a Final Judgment that (1) enjoins Talbot from future violations of the antifraud provisions of the Exchange Act, (2) requires Talbot to disgorge his illicit profits, with prejudgment interest thereon, (3) orders him to pay a civil penalty, and (4) bars him from serving as an officer or director of a public company. The suit is styled "Securities and Exchange Commission v. J. Thomas Talbot, No. CV 04- 4556 MMM (PLAx) (C.D. CA.)." GLOBAL CROSSING: NY Court Refuses To Dismiss Lawsuit V. Execs ------------------------------------------------------------- The United States District Court in New York refused to dismiss the lawsuit filed against Gary Winnick, the founder and ex- chairman of Global Crossing Ltd., and other former Company executives, charging them with fraudulently misrepresenting the Company's finances, the Royal Gazette reports. Investment firm J.P. Morgan Chase & Co. and a group of other banks filed a $1.7 billion suit against the Company's officials, alleging they engaged in a massive scheme to hide the Company's decline so it could borrow $2.25 billion two months before its collapse in bankruptcy in 2002. Judge Gerard E. Lynch refused to dismiss the suit, saying in New York yesterday denied the defendants' request to throw out the suit, saying it isn't clear whether the banks should have uncovered the alleged fraud. The ruling means that Mr. Winnick and the others may have stand to trial before a jury. However, the judge dismissed negligent misrepresentation claims against Mr. Winnick and the other defendants, saying the banks failed to show that the defendants had any special relationship with the banks that would create heightened legal responsibility. Gary Naftalis, a lawyer representing Mr. Winnick, didn't immediately return a call seeking comment. J.P. Morgan's lawyer, Allan S. Brilliant of Milbank, Tweed, Hadley & McCoy, declined to comment, the Royal Gazette states. In March, Mr. Winnick, Global Crossing and some of the company's former lawyers in March agreed to pay $325 million to settle lawsuits brought by investors and employees to resolve claims that Mr. Winnick and others inflated revenue by improperly accounting for phone- service swaps. The settlement included $245 million to settle securities-fraud claims and $80 million for pension claims. The settlement, which represents only a fraction of the $40 billion in stock value wiped out by Global Crossing's January 2002 bankruptcy filing, was the 14th largest ever for a US securities class- action case, according to Bloomberg Data. GREAT ATLANTIC: Former Employees File Overtime Suit in NY Court --------------------------------------------------------------- The Great Atlantic & Pacific Tea Company, Inc., which operates A&P, The Food Emporium and Waldbaum's faces a class action filed by the law firms of Lieff, Cabraser, Heimann & Bernstein, LLP and Outten & Golden LLP on behalf of former employees of the supermarkets. The employees charge that the chains fail to pay employees overtime wages and delete hours actually worked from time records in violation of New York labor law. The complaint, entitled LaMarca et al. v. The Great Atlantic and Pacific Tea Company, Inc., was filed in the Supreme Court of the State of New York, County of New York. Kenneth Palma, a former A&P worker and a plaintiff in the suit, stated, "I decided to file this case because I don't want other workers to experience the same conditions I had when I worked at A&P and Waldbaum's. It isn't fair to work so hard for the company and not get paid for all the hours I worked." Rachel Geman, an attorney with Lieff, Cabraser, Heimann & Bernstein, LLP, explained, "The cashiers, clerks, bakers and other hourly employees at A&P stores are dedicated and hard working employees. This lawsuit seeks to ensure that they are paid for each and every hour of work they perform." "New York employers must properly record work performed and provide overtime pay for work in excess of 40 hours per week," stated Adam T. Klein of Outten & Golden LLP. "That is the law. We believe the evidence will show that A&P failed to comply with these basic obligations for thousands of its employees." The complaint seeks certification of a class of current and former full-time hourly employees of The Great Atlantic & Pacific Tea Company, Inc. in New York for past six years. The Great Atlantic & Pacific Tea Company, Inc. operates approximately 140 supermarkets in the State of New York, of which 32 are A&P division stores, 32 are Food Emporium division stores, and 76 are Waldbaum's division stores. Earlier this year, Lieff Cabraser and Outten & Golden represented approximately 900 current and former employees of A&P supermarkets in the greater New York City metropolitan area in a collective action lawsuit in federal court brought under the federal Fair Labor Standards Act. The plaintiffs sought unpaid overtime compensation resulting from A&P's alleged failure to compensate them for work performed "off-the-clock." In May 2004, the federal court approved a settlement providing $3.11 million to the plaintiffs. Today's suit is brought on behalf of an estimated thousands of current and former A&P, The Food Emporium, and Waldbaum's employees throughout New York state. For more details, contact Rachel Geman of LIEFF, CABRASER, HEIMANN & BERNSTEIN, LLP by Mail: 780 Third Avenue, 48th Floor, New York, NY 10017 by Phone: (212) 355-9500 or by E-mail: rgeman@lchb.com OR Adam T. Klein of OUTTEN & GOLDEN LLP by Mail: 3 Park Avenue, 29th Floor, New York, NY 10016 by Phone: (212) 245-1000 or by E-mail: atk@outtengolden.com LOCAL 28: Minority Workers Ask Court To Hold Union in Contempt -------------------------------------------------------------- A group of former and current minority union workers filed another motion seeking to force the Manhattan-based Local 28 of the Sheet Metal Workers International Association to comply with a court order banning discriminatory practices, Newsday reports. The original lawsuit was filed in 1971. In 1975, a judge ruled that Local 28 "maintained clearly discernible discriminatory practices in recruitment, selection, training, and admission to membership of non-white workers." As a result, the court ordered the union to establish an affirmative action program to deal with inequalities. However, the court has found the union in contempt of court for three times since 1975. The latest motion seeks a fourth contempt finding. The motion alleged that "nearly thirty years after this court first held Local 28 liable for discrimination, Local 28 still refuses to comply with court orders and to provide equal work opportunities to its non-white members." The motion further alleges that the union continued disparate treatments, such as giving job referrals primarily to white members and blocking its non-white apprentices from receiving adequate training and supervision. The motion cites a court expert that has, more than once, found "statistically significant disparity between the hours worked by white and non- white members of Local 28." Plaintiffs' law firm, Debevoise & Plimpton in Manhattan, also seeks class-action status for the lawsuit, which could cover as many as 1,000 workers, almost all in New York City, and involve as much as $100 million in back pay, Jyotin Hamid, one of the firm's associates told Newsday. Other plaintiffs besides the 22 individuals named in Monday's motion, include the U.S. Equal Employment Opportunity Commission, the New York State Division of Human Rights and New York City. Local 28's president, John Harrington, declined to comment because he said he hadn't seen the latest court filing, Newsday reports. NEOPHARM: SEC Issues Subpoena Over Arbitrations, Resignations ------------------------------------------------------------- NeoPharm (Nasdaq:NEOL) received a follow-up subpoena from the SEC as part of an ongoing investigation. The SEC requested documents dealing with the conclusion of the Company's arbitration case with Pharmacia (now Pfizer) and the recent resignation of the Company's former President and CEO, both being events which have occurred since the issuance of the initial subpoena in March of this year. The Company continues to fully cooperate with the SEC and intends to continue to do so in order to bring the inquiry to a conclusion as promptly as possible. The SEC has advised the Company that it has made no determination of any violation of law by the Company or any individual at this time. The Company believes the investigation is an outgrowth of the Company's recently concluded arbitration with Pharmacia regarding the development of its LEP and LED drug product candidates and the class action lawsuits, which have been filed against the Company relating to its public statements regarding the development of LEP. The Company cannot predict with certainty the direction the investigation will take or its ultimate outcome. TOBACCO LITIGATION: AMA Supports $145B Damages in Engle Suit ------------------------------------------------------------ The American Medical Association (AMA) joined several other public interest organizations in a friend-of-the-court brief reaffirming support for a Florida class-action victory against the tobacco industry, the organization said in a statement. In July 2000, the $145 billion punitive damages verdict in Engle v. Liggett Group Inc. et al sent a strong message to tobacco companies that toying with the health and lives of Americans can be a prohibitively expensive business. The damages awarded in this case, however, could be overturned because an appellate court has reconsidered the case's class certification. The AMA believes the Florida Supreme Court should overturn the appellate court's ruling and compel the tobacco defendants to pay for the damages they continue to inflict on society. "As long as the tobacco industry profits from business as usual, they must bear responsibility for the human suffering and economic costs that result from tobacco-related illnesses," said AMA Trustee Ronald M. Davis, MD in a statement. "Preserving the penalties in this case will provide a strong incentive for tobacco companies to change their behavior." More than two million people have lost their lives to smoking in just the past six years since cigarette makers consented to a multi-billion dollar Master Settlement Agreement with 46 states and individual settlements with the other four states. Yet, tobacco companies are still reaping substantial profits from manufacturing and marketing a product known to be both addictive and lethal, the statement asserted. "Tobacco-related illnesses continue as a public health epidemic that is killing our families, our friends, and our neighbors, and its next victims will be our children," said Dr. Davis. "Hundreds of thousands of tobacco-related deaths will continue for years to come as long as the tobacco industry remains undeterred from producing and marketing their deadly products." For more information, visit the American Medical Association Web Site: http://www.ama-assn.org. UNIVERSITY OF IOWA: University Employees To Join Parental Suit -------------------------------------------------------------- University employees have expressed interest in joining a class action filed against the University of Iowa over parental leave after the U.S. District Court in Iowa allowed the suit to proceed, the Daily Iowan reports. Employee David Johnson has received a number of e-mails from university employees wanting to join the suit. Mr. Johnson, a UI employee, filed the suit against the University in June 2003 claiming that they do not grant biological fathers benefits equivalent to those given to mothers and adoptive parents. In the fall of 2002, Mr. Johnson was not allowed to use two weeks' paid sick leave to care for his wife after the birth of their daughter. Mr. Johnson could not say exactly how many UI employees have contacted him about joining the class action lawsuit since the court's November 2003 decision, but he said he has been forwarding e-mails from interested parties to his attorney. Marc Mills, the UI senior associate counsel, told The Daily Iowan, however, that the policy in question will remain in place and that the UI has no plans to retract the policy even if Johnson's lawsuit goes to trial. Mr. Johnson and the university are disputing the class of the lawsuit; Johnson wants the class to extend as far back as January 1993, when the UI implemented the parental-leave policy. The UI, on the other hand, believes the class is subject to a two-year statute of limitations and should go back no further than June 2001, Mr. Mills told the Daily Iowan. The court will determine the class of the suit, and how those who wish to join the lawsuit should be notified, James Larew, Mr. Johnson's attorney, told the Iowan. Larew said he is at the closing phase of the discovery process to meet with the court's July 19 deadline, when it will decide whether to dispose certain aspects of the case or to dismiss the case entirely. Johnson said the discovery process has uncovered material that will help his suit, but he would not reveal specifics. Larew also declined to comment on the legal concepts being used in the suit. WAL-MART STORES: Lawyers Say Evidence Proves Execs Knew of Bias --------------------------------------------------------------- Lawyers for the women in the nationwide sex-discrimination class action against retail giant Wal-Mart Stores, Inc. are preparing evidence that the Company's top level executives were aware that female employees were paid less and promoted less, USA Today reports. The suit, styled "Dukes v. Wal-Mart Stores, Inc., No. C-01-2252 MJJ," was filed three years ago in the United States District Court in San Francisco, California, on behalf of six women. It alleges that the Arkansas-based Wal-Mart set up a system that often pays female workers less than their male counterparts for comparable jobs and bypasses women for promotions, an earlier Class Action Reporter story (June 25,2004) reports. This week, the court granted class certification to the suit, making it the largest civil rights suit ever certified against a private employer. In order to secure punitive damages for the lawsuit, lawyers for the plaintiffs must show that corporate executives exhibited malice or reckless disregard, according to legal experts. "They have to show management knew and ignored it," John Fox, an employment lawyer in Mountain View, California, told USA Today. "That is typically hard to prove." Lawyers for the plaintiffs allege that mails and letters about discrimination were sent directly to Wal-Mart CEO Lee Scott, concerns about the lack of women in management were brought to board members, and Wal-Mart's own internal studies found the company lagged behind other retailers in promoting women. "There are lots of documents showing Wal-Mart was very aware, their board of directors were very aware, of the issues with women, going back many, many years," Brad Seligman of the Impact Fund, a Berkeley, California-based non-profit representing the women, told USA Today. According to the class certification briefing, information was shared with board members. The Company reportedly conducted its own benchmarking study, which concluded that "Wal-Mart falls significantly behind other comparable firms." Coleman Peterson, Wal-Mart's former vice president of human resources, asserted that "we are behind the rest of the world," the briefing says. It also revealed that minutes from a board of directors committee meeting in March 1999 state that Wal-Mart's percentage of women in store management trails other retailers, according to the legal brief, USA Today states. Several of the Company's women employees alleged in sworn statements that they complained about pay disparities or sexism to the corporate office but got little or no response. Outsiders also complained to stockholders, but Wal-Mart executives repeatedly ignored their concerns. The Company has denied the charges and plans to appeal the certification. Wal-Mart officials declined to comment because of the pending litigation but said any problems were isolated. In a statement, they noted the class-action certification has "absolutely nothing" to do with the merits of the case, USA Today reports. The "Dukes v. Wal-Mart Stores, Inc., No. C-01-2252 MJJ," is pending before Judge Martin Jenkins in the United States District Court for the Northern District of California. The lead plaintiffs in the suit are Betty Duckes, Patricia Surgeson, Cleo Page, Deborah Gunter, Karen Williamson, Christine Kwapnoski, and Edith Arana. They and the class are represented by three public interest non-profit groups, The Impact Fund (Berkeley, CA.), Equal Rights Advocates (San Francisco), Public Justice Center (Baltimore, MD), and four private law firms of Cohen, Milstein, Hausfeld & Toll (Washington, D.C.) Davis Cowell & Bowe (SF) and New Mexico's Tinkler & Firth and Merit Bennett (Santa Fe, NM). Judge Martin Jenkins will hold a status conference at 2:00 p.m. on Wednesday, July 28, 2004, to talk about noticing, scheduling and case management issues. New Securities Fraud Cases 99 CENTS: Schiffrin & Barroway Launches Securities Suit in CA ------------------------------------------------------------- The law firm of Schiffrin & Barroway, LLP initiated class action lawsuit in the United States District Court for the Central District of California on behalf of all purchasers of the of 99 Cents Only Stores (NYSE: NDN) ("99 Cents" or the "Company") from March 11, 2004 through June 10, 2004, inclusive (the "Class Period"). The complaint charges that the Company, David Gold, Eric Schiffer, and Andrew A. Farina violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between March 11, 2004 and June 10, 2004, about the Company's financial condition thereby artificially inflating the price of 99 Cents' shares. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company underestimated competition when it opened stores in Texas; (2) that as a result of this, the Company failed to implement a more flexible pricing strategy in its Texas stores that would have achieved "growth" for the Company; (3) that its Los Angeles distribution center was operating at over capacity thereby negatively impacting labor productivity, store deliveries, store level in-stock positions, and consequently comparable sales; (4) that the Company's comparable sales were being negatively impacted by distribution challenges and aggressive post strike promotions from supermarkets especially in Southern California (most notably Kroger, Co., Albertson's, Inc., and Safeway, Inc.); (5) that the Company's gross margins increased due to unfavorable freight costs, increased prices on dairy products, and an unfavorable shrink variance; (6) that the Company lacked adequate internal controls; (7) that the Company's bottom line continued to be adversely affected by worker's compensation expenses; and (8) that as a result of the above, the defendants' positive statements about the Company were lacking in any reasonable basis when made. On June 11, 2004, 99 Cents reported that it was lowering second quarter 2004 earnings per share guidance to $0.04 to $0.07 per share. News of this shocked the market. Shares of 99 Cents fell $6.38 per share or 31.15 percent to close at $14.10. For more details, contact Marc A. Topaz, Esq. or Stuart L. Berman, Esq. of Schiffrin & Barroway, by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1-888-299-7706 or 1-610-667-7706 or by E-mail: info@sbclasslaw.com. BISYS GROUP: Bernstein Liebhard Files Securities Suit in S.D. NY ---------------------------------------------------------------- The law firm of Bernstein Liebhard & Lifshitz, LLP has commenced a securities class action lawsuit in the United States District Court for the Southern District of New York on behalf of all persons who purchased or acquired securities of the Bisys Group, Inc. (NYSE: BSG) ("Bisys" or the "Company") between October 23, 2000 and May 17, 2004, inclusive (the "Class Period"), seeking to pursue remedies under the Securities Exchange Act of 1934 (the "Exchange Act"). The Complaint alleges that during the Class Period defendants' publicly disseminated results of Bisys' operations and financial condition contained artificially inflated revenues, assets and income. Such results were not prepared or reported in accordance with Generally Accepted Accounting Principles and deceived investors as to the Company's true performance, thereby artificially inflating the price of Bisys securities during the Class Period. On May 17, 2004, after the close of ordinary trading, Bisys announced that it would be restating "its financial results for each of the fiscal years ended June 30, 2003, 2002 and 2001, as well as its interim results for fiscal 2004," to account for a $70 million to $80 million adjustment to its previously reported commissions receivable in its life insurance division. In response to this announcement, the price of Bisys common stock dropped, closing at $12.97 on May 18, 2004, down from a high of $14.50 on May 17 on unusually heavy trading volume. For more details, contact the Shareholder Relations Department of Bernstein Liebhard & Lifshitz, LLP by Mail: 10 East 40th Street, New York, New York 10016 by Phone: (800) 217-1522 or (212) 779-1414 or by E-mail: BSG@bernlieb.com HANGER ORTHOPEDIC: Geller Rudman Lodges Securities Lawsuit in VA ---------------------------------------------------------------- The Law Firm of Geller Rudman, PLLC announced today that a class action lawsuit has been filed in the United States District Court for the Eastern District of Virginia, Alexandria Division on behalf of purchasers of Hanger Orthopedic Group, Inc. (NYSE: HGR) ("Hanger Orthopedic" or the "Company") common stock during the period between February 26, 2003 and June 14, 2004, inclusive (the "Class Period"). The complaint charges Hanger Orthopedic and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Hanger Orthopedic owns and operates orthotic and prosthetic patient-care centers in the United States. The complaint alleges that during the Class Period, defendants caused Hanger Orthopedic's shares to trade at artificially inflated levels through the issuance of false and misleading financial statements. As a result of this inflation, defendants were able to sell 167,270 Hanger Orthopedic shares, reaping insider trading proceeds of $2.4 million. On June 14, 2004, an investigative report on WNBC television charged that Hanger Orthopedic "may have improperly booked sales by filling out fake prescriptions." According to the report, Hanger Orthopedic recorded sales for patients that did not exist and added items that were not prescribed to existing patients in order to increase bills to Medicaid and Medicare. The report also said Hanger Orthopedic submitted forged prescriptions using a blank prescription pad. The stock dropped to below $12 per share on this news. On June 18, 2004, the Company issued a press release in which it announced "developments relating to previously announced allegations in the press concerning possible billing improprieties. ... The allegations included claims by an employee ... that one of the clinicians was signing doctors' signatures on prescription forms." The release also stated that "(o)n June 17, 2004, the Company received a subpoena from the U.S. Attorney's Office for the Eastern District of New York requesting that the Company produce documents relating to these allegations .... The SEC also has requested information from the Company relating to the allegations." For more details, contact Samuel H. Rudman, Esq. or David A. Rosenfeld, Esq. of GELLER RUDMAN, PLLC by Mail: Client Relations Department - 200 Broadhollow, Suite 406, Melville, NY 11747 by Phone: 631-367-7100 or 1-877-992-2555 by Fax: 1-631-367-1173 by E-mail: info@geller-rudman.com or visit their Web site: http://www.geller-rudman.com HANGER ORTHOPEDIC: Charles J. Piven Lodges Securities Suit in NY ---------------------------------------------------------------- The Law Offices Of Charles J. Piven, P.A. commenced a securities class action on behalf of shareholders who purchased, converted, exchanged or otherwise acquired the common stock of Hanger Orthopedic Group, Inc. (NYSE:HGR) between July 29, 2003 and June 14, 2004, inclusive (the "Class Period"). The case is pending in the United States District Court for the Eastern District of New York against defendant Hanger, Thomas F. Kirk, George E. McHenry and Ivan R. Sable. 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. No class has yet been certified in the above action. For more details, contact Law Offices Of Charles J. Piven, P.A. 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 HANGER ORTHOPEDIC: Brodsky Smith Lodges Securities Lawsuit in PA ---------------------------------------------------------------- The Law offices of Brodsky & Smith, LLC initiated a securities class action lawsuit on behalf of shareholders who purchased the common stock and other securities of Hanger Orthopedic Group, Inc. ("Hanger Orthopedic" or the "Company") (NYSE:HGR), between February 26, 2003 and June 14, 2004 inclusive (the "Class Period"). The class action lawsuit was filed in the United States District Court for the Eastern District of Virginia. The Complaint alleges that defendants violated federal securities laws by issuing a series of material misrepresentations to the market during the Class Period, thereby artificially inflating the price of Hanger Orthopedic securities. No class has yet been certified in the above action. For more details, contact Marc L. Ackerman, Esq. or Evan J. Smith, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004 by Phone: 877-LEGAL-90 by E- mail: clients@brodsky-smith.com KEY ENERGY: Berger & Montague Lodges Securities Suit in W.D. TX --------------------------------------------------------------- The law firm of Berger & Montague, P.C. initiated a class action suit against Key Energy Services, Inc. ("Key" or the "Company") (NYSE: KEG) and certain of its officers, in the United States District Court for the Western District of Texas on behalf of all persons or entities who purchased Key securities from April 29, 2003 through June 4, 2004 (the "Class Period"). The complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by the SEC by issuing materially false and misleading statements throughout the Class Period that had the effect of artificially inflating the market price of the Company's securities. The complaint alleges that defendants failed to disclose or indicate the following: (1) that the Company had materially overstated its revenues, net income, and earnings per share; (2) that defendants failed to take certain write-downs of approximately $78 million of assets, consisting predominantly of idle equipment; (3) that the defendants failed to amortize its goodwill; (4) that the defendants failed to record $5 million of goodwill and other intangible assets relating to an acquisition in the Company's South Texas Division in 2003, in violation of generally accepted accounting principles ("GAAP"); (5) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (6) that as result of the above, the Company's financial results were materially inflated at all relevant times. On March 15, 2004, Key Energy announced it had filed notice with the SEC on Form 12b-25 to extend the period in which it intended to file its Annual Report on Form 10-K. Shortly thereafter, the Company shocked the market when it announced that it would not file its Annual Report on Form 10-K for the year ended December 31, 2003 by the March 30, 2004 extended deadline. More specifically, Key Energy stated that as a result of the Company's continuing review, the Company currently believed that a write-down of approximately $78 million of assets, consisting predominantly of idle equipment, would be required, a substantial portion of which the Company believed should have been recorded in one or more prior years. As a result, the Company expected to restate one or more prior year financial statements. Then on June 7, 2004, before the markets opened, Key Energy announced that it was withdrawing earnings forecasts for fiscal 2004 and that it had received a notice of default under its 6.375% and 8.375% Senior Notes. The Company stated that it was withdrawing all previous earnings forecasts of operating results for 2004. The Company was doing so in light of current uncertainties affecting the Company, including the costs of the ongoing audit of the Company's 2003 financial statements and restatement of prior years' financial statements, bank and other lender waivers, ongoing Audit Committee and SEC investigations, costs related to previously announced management changes and costs related to management consolidation in the Company's Midland office. The market reacted swiftly to the news. Shares of Key Energy fell on June 7, 2004, closing at $8.67 per share. For more details, contact Sherrie R. Savett, Esq., Douglas M. Risen, Esq. or Diane Werwinski, Investor Relations Manager of Berger & Montague, P.C. by Mail: 1622 Locust Street, Philadelphia, PA 19103 by Phone: 888-891-2289 or 215-875-3000 by Fax: 215-875-5715 by E-mail: InvestorProtect@bm.net or visit their Web site: http://www.bergermontague.com MERIX CORPORATION: Milberg Weiss Lodges Securities Lawsuit in OR ---------------------------------------------------------------- The law firm of Milberg Weiss Bershad & Schulman LLP initiated a class action lawsuit on behalf of purchasers of the securities of Merix Corporation ("Merix" or the "Company") (NASDAQ: MERX) between July 1, 2003 and May 13, 2004, inclusive (the "Class Period"), seeking to pursue remedies under the Securities Exchange Act of 1934 (the "Exchange Act"). The action is pending in the United States District Court for the District of Oregon, against defendants Merix, Mark Hollinger (President, CEO and Chairman), and Janie S. Brown (Chief Financial Officer). According to the complaint, defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period. The complaint alleges that throughout the Class Period, defendants represented that Merix was well-positioned for continued growth and profitability and that its business was growing at a faster pace than its competitors. Merix represented that its strong growth and profitability would continue into the fourth quarter of 2004, ending May 29, 2004, boosted by increased end-user demand for products utilizing its components. In fact, unbeknownst to investors, demand for the Company's high-end services was declining and demand for its products was driven by inventory build-up by its customers, who would meet end-user demand by selling off the inventory, thereby cutting into new sales for Merix. These were highly material facts that defendants knew or, at the very least, recklessly disregarded, would materially and negatively impact Merix's profitability and top-line growth. Defendants failed to disclose these highly material facts about Merix's business so that Merix insiders, including defendants Hollinger and Brown could sell their personally held Merix stock at artificially inflated prices. Throughout the Class Period Merix insiders, including defendants Hollinger and Brown, sold a total of 162,138 shares for total proceeds of $3,398,478. On May 13, 2004, after the close of ordinary trading, Merix issued a press release announcing that instead of earning a profit of between $0.19 and $0.22 per share for its fourth quarter of 2004, as the Company had previously stated it expected to earn, it now expected to report a loss of $0.03 to $0.06 per share. In response to this announcement, the price of Merix common stock plummeted, from a closing price of $15.32 per share on May 13, 2004 to $10.68 per share on May 14, a one-day drop of over 30% on unusually heavy trading volume. For more details, contact Steven G. Schulman, Peter E. Seidman or Andrei V. Rado by Mail: One Pennsylvania Plaza, 49th fl., New York, NY, 10119-0165 by Phone: (800) 320-5081 by E-mail: sfeerick@milbergweiss.com or visit their Web site: http://www.milbergweiss.com MERIX CORPORATION: Lerach Coughlin Lodges Securities Suit in OR --------------------------------------------------------------- The law firm of Lerach Coughlin Stoia & Robbins LLP commenced a class action in the United States District Court for the District of Oregon on behalf of purchasers of Merix Corporation ("Merix") (NASDAQ:MERX) publicly traded securities during the period between July 1, 2003 and May 13, 2004 (the "Class Period"). The complaint charges Merix and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that during the Class Period, defendants issued materially false and misleading statements to the investing public regarding the Company's business prospects. Then on May 13, 2004, defendants announced that the Company would fall materially short of hitting its forecasted projections. On this news, the Company's shares plunged from $15.32 to $10.68 per share, a market cap loss of more than $90 million. According to the complaint, during the Class Period defendants knew but concealed from the investing public that: (1) the Company's Wood Village facilities were not suitable or ready for defendants' claimed plans as stated in their press releases; (2) the Company's gross margins were being eroded by defective products, a shift in the Company's business model and costs associated with the Company's opening of a long-planned new facility; (3) the Company was experiencing a material decline in its "premium service business," a line of business which once provided the Company with 50% of its revenue; (4) the Company's top networking customer, Cisco, had dramatically reduced its orders from the Company due to excessive inventory in its channel; (5) the Company had experienced a massive manufacturing disruption, which included a lamination failure in its boards, which pushed orders out into future quarters and would prevent these orders from being recognized as revenue until the indefinite future; (6) the Company was losing market share, as Cisco was increasing business with other suppliers (which had capacity on hand) thus avoiding paying premiums; and (7) as a result, the Company's fourth quarter projections (ending May 2004) of $0.12-$0.14 earnings per share were grossly inflated. In fact the Company was not even on track to achieve profits, but rather, losses. As a result of the defendants' false statements, Merix's stock price traded at inflated levels during the Class Period, increasing to as high as $28 in January 2004, whereby the Company's top officers and directors sold more than $3.5 million worth of their own shares, and Merix completed a $90 million secondary offering. For more details, contact William Lerach or Darren Robbins of Lerach Coughlin Stoia & Robbins LLP by Phone: 800-449-4900 by E- mail: wsl@lcsr.com or visit their Web site: http://www.lcsr.com/cases/merix NBTY INC.: Paskowitz & Associates Lodges Securities Suit in NY -------------------------------------------------------------- The Law firm of Paskowitz & Associates initiated a class action lawsuit in the United States District Court for the Eastern District of New York on behalf of persons who purchased or otherwise acquired publicly traded securities of NBTY, Inc. ("NBTY" or the "Company") (NYSE: NTY - News) between April 22, 2004 and June 16, 2004, inclusive, (the "Class Period"). The lawsuit was filed against NBTY and its top executives, Scott Rudolph and Harvey Kamil. The complaint alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint asserts that the Company issued false and misleading statements concerning its financial results for the quarter ending March 31, 2004. On April 22, 2004, NBTY announced increased sales in that quarter for its various business segments, including its Direct Response segment, which sells products through catalogs and the Internet. The increased sales were attributed to "the Company's ability to more effectively target market its customer base." In truth, the results were due to special sales promotions, and not any generalized improvement in the Company's marketing abilities. Indeed, it is alleged that in the month of April sales in this segment dropped off 14% because the special promotion had ended. Before this decline was revealed to the public, defendant Rudolph sold 400,000 shares for proceeds of over $14 million, while defendant Kamil sold 157,000 shares for proceeds of over $6 million. On June 17, 2004, NBTY shocked investors by announcing sales declines in the Direct Response segment of 12% for the months of April and May, sending shares plunging from a close of $36.50 the previous day to $26.99 on trading volume of 8.3 million shares. For more details, contact Paskowitz & Associates by Phone: 800-705-9529 or by E-mail: classattorney@aol.com OMNIVISION TECHNOLOGIES: Weiss & Yourman Files CA Stock Suit ------------------------------------------------------------ The law firm of Weiss & Yourman initiated a class action lawsuit in the United States District Court for the Northern District of California on behalf of purchasers of OmniVision Technologies, Inc. (Nasdaq: OVTI) securities between February 19, 2003 and June 8, 2004 (the "Class Period"). OmniVision produces semiconductor image sensor devices. The Company's main product, an image sensing device called the CameraChip, is used to capture an image in a wide variety of consumer and commercial mass market applications, including digital still cameras, cellular telephones, security and surveillance cameras and video game consoles. The complaint alleges that OmniVision and certain of its officers violated federal securities laws by making false and misleading statements to the investing public regarding OmniVision's business and prospects, causing OmniVision's stock price to trade at artificially inflated levels during the Class Period, while at the same time, company insiders were selling off more than $30 million worth of their personal shares. After OmniVision announced that it would be delaying reporting its fiscal 2004 results and disappointing 1Q05 forecasts, the Company's shares fell 30% to $17.63 per share. As more fully detailed in the Complaint, defendants concealed from the public that the Company's previous financial statements had improperly recognized revenue and that the Company was actually losing market share to larger rivals, such as Micron Technology. For more details, contact Weiss & Yourman - Los Angeles by Phone: (800) 437-7918 by E-mail: info@wyca.com or visit their Web site: http://www.wyca.com SHAW GROUP: Schiffrin & Barroway Lodges Securities Suit in LA ------------------------------------------------------------- The law firm of Schiffrin & Barroway, LLP has initiated a class action lawsuit in the United States District Court for the Eastern District of Louisiana on behalf of all securities purchasers of The Shaw Group, Inc. (NYSE: SGR) ("Shaw" or the "Company") from October 19, 2003 through June 10, 2004, inclusive (the "Class Period"). The complaint charges that Shaw, Tim Barfield, Jr., J.M. Bernhard, Jr., Richard F. Gill, and Robert Belk, violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between October 19, 2003 and June 10, 2004, about the Company's financial condition thereby artificially inflating the price of Shaw's shares. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company's earnings were materially lagging; (2) that because the Company's earnings were lagging, the Company's creation of $83.7 million reserve for contracts acquired from Stone & Webster and adjusted for fair market value, was solely done as a means for the defendants to manipulate the Company's margins and report positive financial results; (3) that the Company's practice of cannibalizing the reserves, created to adjust newly acquired contracts to fair value, had substantially depleted the gross margin reserves and resulted in an eventual earnings decline; (4) that as a consequence of this, the Company improperly recorded revenue and earnings in violation of its purported revenue recognition policy and Generally Accepted Accounting Principles ("GAAP"); and (5) that as a result of the above, the Company's financial results were materially inflated at all relevant times. On June 10, 2004, Shaw disclosed that the Company was notified by the SEC on June 1, 2004, that the SEC was conducting an informal inquiry of Shaw. The SEC investigation focused on the Company's purchase method of accounting for acquisitions. The news shocked the market. Shares of Shaw fell $1.53 or 12.4 percent on June 11, 2004, to close at $10.75. For more details, contact Marc A. Topaz, Esq. or Stuart L. Berman, Esq. of Schiffrin & Barroway, by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1-888-299-7706 or 1-610-667-7706 or by E-mail: info@sbclasslaw.com VASO ACTIVE: Marc Henzel Files MA Securities Fraud Suit ------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Massachusetts, on behalf of purchasers of the securities of Vaso Active Pharmaceutical, Inc. (OTC: VAPH.PK) between December 11, 2003 and March 31, 2004, inclusive (the "Class Period"), seeking to pursue remedies under the Securities Exchange Act of 1934. The action is pending against defendants Vaso, John J. Masiz (President and CEO), and Stephen G. Carter (Chief Scientific Officer). According to the complaint, defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period. The complaint alleges that throughout the Class Period, Vaso issued press releases, and filed financial reports with the SEC, touting the Company's clinical trial of its anti-fungal product as being "revolutionary", and stated that the trial was supervised by a team of independent physicians, analyzed by the New England Medical Center of Boston, and endorsed by the American Association of Medical Foot Specialists. The complaint charges that defendants' assertions were grossly misleading because: (1) the New England Medical Center had nothing to do with the study associated with the trial, it was not involved in the selection of patients for the trial, and it had not analyzed the trial results or drawn any conclusions of its effectiveness; (2) the trial was supervised by one podiatrist, not a group of independent physicians, who was selected by the Company's majority shareholder and compensated by the Company; (3) the Company's so-called "clinical trial" was more than half a decade old; (4) the Association of Medical Foot Specialists is not widely known in the medical community, and its endorsement of Vaso's product was bargained for in exchange for a donation by Vaso to the Association's scholarship program; and (5) there was little, if any, institutional demand for Vaso's securities. On April 1, 2004, before the market opened, the Securities and Exchange Commission issued a press release announcing the temporary suspension of trading of Vaso stock because of "questions regarding the accuracy of assertions by VAPH (Vaso) and by others. . . concerning, among other things: (1) FDA approval of certain key products, and (2) the regulatory consequences of the future application of their primary product." Moreover, on April 7, 2004, Vaso announced that the Company had received a letter from the Nasdaq Listing Investigations department regarding Vaso's compliance with Nasdaq listing requirements. In response to the Nasdaq letter, Vaso stated "In view of the substantial administrative and cash burdens being borne by the Company at this time, the Company has determined that it is in the best interest of shareholders to voluntarily cause its shares to be removed from Nasdaq". For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by E-Mail: mhenzel182@aol.com VICURON PHARMACEUTICALS: Marc Henzel Files Securities Suit in PA ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Eastern District of Pennsylvania on behalf of purchasers of the securities of Vicuron Pharmaceuticals Incorporated (NasdaqNM: MICU) between January 6, 2003 and May 24, 2004, inclusive. The action is for remedies under the Securities Exchange Act of 1934. The Complaint alleges that, during the Class Period, defendants artificially inflated the price of Vicuron stock by concealing negative material information concerning both the safety and efficacy of Anidulafungin, Vicuron's intravenous treatment of fungal infections which is the subject of late- stage clinical trials for the treatment of esophageal candidiasis, invasive aspergillosis, and invasive candidiasis/candidemia. Defendants concealed key adverse information regarding the development and commercialization of Anidulafungin, which raised serious concerns about the FDA's future approval of the drug. The partial disclosure of the contents of an FDA letter, dated Monday, May 24, 2004, detailing the failure of Vicuron to supply data necessary to support its claim that Anidulafungin can be used to treat esophageal candidasis, caused Vicuron shares to plummet $8.86 to $13.04, a loss of over 40% from the previous trading day and a loss of over 45% from its Class Period high of $23.90. For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by E-Mail: mhenzel182@aol.com VICURON PHARMACEUTICALS: Brodsky & Smith Lodges PA Stock Suit ------------------------------------------------------------- The Law offices of Brodsky & Smith, LLC initiated a securities class action lawsuit on behalf of shareholders who purchased the common stock and other securities of Vicuron Pharmaceuticals, Inc. ("Vicuron" or the "Company") (Nasdaq:MICU) between January 6, 2003 and May 24, 2004 inclusive (the "Class Period"). The class action lawsuit was filed in the United States District Court for the Eastern District of Pennsylvania. The Complaint alleges that defendants violated federal securities laws by issuing a series of material misrepresentations to the market during the Class Period, thereby artificially inflating the price of Vicuron securities. No class has yet been certified in the above action. For more details, contact Marc L. Ackerman, Esq. or Evan J. Smith, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004 by Phone: 877-LEGAL-90 by E- mail: clients@brodsky-smith.com WINN-DIXIE STORES: Marc Henzel Lodges Securities Suit in M.D. FL ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Middle District of Florida on behalf of purchasers of the securities of Winn-Dixie Stores, Inc. (NYSE: WIN) between May 6, 2002 and January 30, 2004, inclusive. Throughout the Class Period, Winn-Dixie was suffering from substantial undisclosed long-term business and financial problems. Nevertheless, then CEO Allen Rowland continued to tell investors that Winn-Dixie was capitalizing on its strategic marketing plan. Rowland also touted the Company's success in announcements throughout the Class Period declaring cash dividends to Winn-Dixie shareholders. In June 2003, Rowland stepped down as CEO, receiving a $7.7 million severance payment. Frank Lazaran, his successor, ordered a comprehensive review of Winn-Dixie's "entire business model." Even while this restructuring was underway, Winn-Dixie and Lazaran repeatedly told the public that the Company was successfully executing its sales and marketing plan. On January 30, 2004, Winn-Dixie stunned the public by announcing a $79.5 million loss, or $0.57 per share, for its second fiscal quarter ended January 7, 2004. Lazaran meekly told the public: "[W]e recognize that we cannot continue down this path." Winn- Dixie's stock plunged nearly 28% on volume of 24.6 million shares; the company discontinued dividend payments indefinitely. Winn-Dixie announced a "series of major actions," including a plan for $100 million in expense reductions by July 1, 2004, in- depth analysis of the Company's core markets and market share, and an "image makeover program." Winn-Dixie also announced it must recognize a $36.4 million charge to earnings for asset impairment, and add $21.4 million to reserves for self- insurance. For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by E-Mail: mhenzel182@aol.com ********* A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the Class Action Reporter. Submissions via e-mail to carconf@beard.com are encouraged. Each Friday's edition of the CAR includes a section featuring news on asbestos-related litigation and profiles of target asbestos defendants that, according to independent researches, collectively face billions of dollars in asbestos-related liabilities. ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Glenn Ruel Se�orin, Aurora Fatima Antonio and Lyndsey Resnick, Editors. Copyright 2004. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. 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