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             C L A S S   A C T I O N   R E P O R T E R

             Tuesday, October 5, 2004, Vol. 6, No. 197

                          Headlines


ADVANCED MARKETING: SEC Files Civil Charges V. Marcy Wilson Roke
ALABAMA: Lawyers Argue On Remaining AL Syphilis Experiment Pact
ALTA-DENA: Recalls Baskin-Robbins Ice Cream For Undeclared Eggs
ARIZONA: Yuma County Back Wages Legal Battle To Be Resolved Soon
ATLANTA: Emory Hospital To Inform 500 Patients of CJD Exposure

BLACK BOX: PA Court Grants Final Approval To $2M Suit Settlement
BRICKER ZAKOVICS: Agrees To Settle Former Clients Lawsuit in WA
CALIFORNIA: Monterey Judges File Suit To Regain Benefits, Wages
CALIFORNIA: Participants Sought in Lawsuit V. Sheriff's Office
CLARENT CORPORATION: SEC Files Suit V. Ex-CFO, Asia Pacific Head

GAY ADOPTION: ACLU Asks High Court To Hear Challenge on 1977 Law
GREAT ATLANTIC: Settles Canada Franchisee Suit For $32 Million
GROH ASSET: SEC Issues Administrative Order Against Roger Groh
HEDSTROM CORPORATION: CA Court Approves CCA Lawsuit Settlement
ILLINOIS: Court Junks Race Bias Lawsuit V. Grand Victoria Casino

LIBERATE TECHNOLOGIES: SEC Lodges Fraud Charges V. Ex-Executives
LOUISIANA: Gay Rights Activists Fight Outlawing of Gay Unions
MERCK & CO.: Lawsuits Over Vioxx Use Surface Right After Recall
MINNESOTA: ACLU Sets Up Office To Investigate Racial Profiling
NEW YORK: Rensselaer County Reaches Pact For Strip Search Suit

PHILIP MORRIS: Six IL Justices To Decide Appeal $10.1 B Verdict
PIZZA HUT: CA Court Denies Appeals For RGM, RTM Overtime Lawsuit
REDDI BRAKE: Finalizes Settlement of CA Shareholder Fraud Suit
SOUTHWESTERN BELL: Judge Approves $21.7M Yellow Pages Settlement
SPECTRUM BRANDS: SEC Sues Attorney, Promoters For Anthrax Hoax

TOBACCO LITIGATION: MO Court Refuses Damages in Smokers Lawsuit
UNION PACIFIC: Settlement Overseers Reject 241 "Dubious" Claims
WASTE MANAGEMENT: Former VP Settles SEC Civil Enforcement Action
WILLIAMS COMPANIES: Court Sets Oct. 28 Lead Plaintiff Deadline


                  New Securities Fraud Cases

AQUILA INC.: Wolf Haldenstein Lodges Securities Fraud Suit in MO
INFINEON TECHNOLOGIES: Schatz & Nobel Lodges CA Securities Suit
MERCK & CO.: Charles J. Piven Lodges Securities Fraud Suit in NJ
MERCK & CO.: Jeffrey L. Suher Lodges Securities Fraud Suit in PA
MERCK & CO.: Wolf Haldenstein Lodges Securities Fraud Suit in NJ

STONEPATH GROUP: Berman DeValerio Lodges Securities Suit in PA
TECO ENERGY: Squitieri & Fearon Lodges Securities Lawsuit in FL
WET SEAL: Murray Frank Lodges Securities Fraud Suit in C.D. CA
WET SEAL: Weiss & Yourman Files Securities Fraud Suit in N.D. CA
ZIX CORPORATION: Murray Frank Lodges Securities Fraud Suit in TX

                          *********

ADVANCED MARKETING: SEC Files Civil Charges V. Marcy Wilson Roke
----------------------------------------------------------------
The Securities and Exchange Commission filed civil charges
against Marcy Wilson Roke for her participation in schemes to
improperly inflate the earnings of Advanced Marketing Services,
Inc. (AMS). AMS is a San Diego-based wholesaler of general
interest books that provides a variety of other services,
including promotional and advertising services. Roke, age 37, of
San Diego, California, was director of advertising at AMS from
1999 through 2004.

The Commission's complaint, filed today in U.S. District Court
in San Diego, alleges that Roke participated in schemes to
improperly manipulate AMS's earnings that were carried out
primarily through AMS's advertising department. The complaint
alleges that the fraudulent schemes caused AMS to overstate its
pre-tax earnings by about 9% in fiscal year 2001, 10% in fiscal
year 2002, and 19% in fiscal year 2003.

The complaint alleges that AMS fraudulently overstated its
earnings through two schemes. The first scheme involved the
production of fewer advertising vehicles than AMS had contracted
with publishers to provide. One advertising service that AMS
provides to publishers is to print and mail advertising vehicles
- such as inserts, catalogs, and post-cards - for books the
publishers produce. Through Roke's involvement, AMS improperly
recognized revenue on the full quantity of advertising vehicles
it had agreed to distribute, because it did not in fact produce
the agreed-upon number of vehicles. As a result, AMS recorded
revenue for these services contrary to generally accepted
accounting principles, and thereby improperly overstated its
earnings.

The complaint further alleges that Roke participated in a scheme
to increase AMS's income by improperly reversing certain accrued
liabilities relating to retail cooperative advertising. AMS
recorded liabilities for credits that it expected retailers to
take for certain advertising and promotional services that the
retailers provided. When the retailers did not take the credits
due to them, instead of contacting the retailers and reconciling
amounts, Roke directed advertising and sales personnel to hide
the discrepancies from the retailers, so that AMS could
improperly reverse the liability and thereby decrease expenses
and increase its income.

Roke profited from her participation in the fraudulent schemes
from her receipt of annual bonuses and sales of AMS stock, which
totaled more than $200,000.

Randall R. Lee, Regional Director of the SEC's Pacific Regional
Office in Los Angeles, stated, "This action marks an important
first step in our efforts, in coordination with the Department
of Justice, to hold accountable all those who participated in
the schemes to defraud the investing public at AMS by
manipulating and overstating its advertising earnings."

The complaint alleges that Roke violated the antifraud
provisions (Section 17(a) of the Securities Act of 1933 and
Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 thereunder) and the books and records provisions of the
federal securities laws (Section 13(b)(5) of the Exchange Act)
as well as aiding and abetting and violating the record-keeping
provisions of the federal securities laws (Section 13(b)(2)(A)
of the Exchange Act and Rule 13b2-1 thereunder). The SEC seeks a
permanent injunction, disgorgement of all ill-gotten gains plus
prejudgment interest, and a civil penalty against Roke.

The Commission acknowledges the cooperation and assistance of
the United States Attorney's Office for the Southern District of
California.

The Commission's investigation is continuing. The action is
titled, SEC v. Marcy Wilson Roke, Case No. 04 CV 1966 H (POR)
(S.D. Cal.).


ALABAMA: Lawyers Argue On Remaining AL Syphilis Experiment Pact
---------------------------------------------------------------
Lawyers for the parties in the lawsuit filed against the
government over its deadly Tuskegee Syphilis Experiment are
still wondering what to do with the remainder of the $9 million
settlement for the victims, the Montgomery Advertiser reports.

Three decades ago, the Syphilis Experiment was conducted on
black males with syphilis from Macon County, Alabama and 201 men
without the disease.  The men believed they were being treated
for their condition, but in reality were just given injections
and pills that had no curing effects on their ailment.

On May 16, 1997, President Clinton apologized to the last eight
survivors of the Tuskegee Syphilis Experiment.  "We can look you
in the eye and finally say on behalf of the American people,
what the United States did was shameful, and I am sorry,"
President Clinton said.

A class action was filed on behalf of the victims, styled
"Charlie W. Pollard v. United States of America."  In September
1975, the government and attorney for the plaintiffs Fred Gray,
Sr. reached a settlement worth $9,066,000, which stipulated that
if any money was remaining - after all survivors and heirs were
paid - it would revert to the U.S. Treasury.

Approximately $170,000 remains and the government is ready to
collect.  On June 22, however, Mr. Gray filed a legal motion to
channel the remaining money to the Tuskegee Human and Civil
Rights Multicultural Center as a memorial to his clients.  Mr.
Gray is president of the center's board and his daughter,
Deborah Gray, is executive director.

"We're going to have a permanent memorial for these men
regardless," Mr. Gray said from his Tuskegee office, according
to the Advertiser.  "We just think the government ought to want
to do something to help."

Before President Clinton apologized, Herman Shaw, one of the men
in the study, said, "...in addition to an apology, we want to
construct in Tuskegee a permanent memorial.  A place where our
children and grandchildren will be able to see the contributions
that we, and others, made to this country.  I am glad that I
have helped form the Tuskegee human rights multicultural center,
which will be for the purpose of creating such a lasting
memorial."

The United States Attorney's office has responded to Mr. Gray's
motion, stating that all parties already agreed to return any
remaining money and that the government has a right to collect.
"As laudable an institution as it is, it is not a party to this
lawsuit.  The settlement agreement laid out very specifically
how the money would be disbursed," said Stephen Doyle, civil
chief of the U.S. Attorney's Office for the Middle District of
Alabama, according to the Montgomery Advertiser.  "We have no
authority to do otherwise. This was a binding agreement."

"If I knew then what I know now" about the government abuses, "I
would have never entered into the agreement that I did," Mr.
Gray told the Advertiser.

The government is standing fast on its assertion.  "This is not
the mechanism through which the government disburses monies to
charitable organizations," Mr. Doyle told the Advertiser.

Gray said he will press on despite the resistance.  "They (the
victims) wanted people to have a permanent memorial. This center
is a partial fulfillment of the desire of these men," he said.

Although Mr. Gray and his son, Fred Gray Jr., are officers of
the center and his daughter is the only paid employee, Mr. Gray
insists no impropriety exists.  The other officers include
Milton McGregor, Johnnie Royster, Carl Marbury and Eddie Tullis,
none of whom is paid, he told the Advertiser.  His daughter
makes less than $35,000 a year and "does whatever needs to be
done" for the 501(c)3 nonprofit organization, he said.  Tax
returns support this statement.

"For the first three years we had no budget and she was paid out
of this office," Mr. Gray said, referring to his law firm.  He
said the officers act primarily as fundraisers for the center.
"Instead of people giving me honorariums for speaking
engagements, I've been asking them to give the money to the
center."

The issue is before U.S. Magistrate Judge Vanzetta Penn
McPherson now.  "She'll make a recommendation to the district
court judge," Mr. Doyle said. "We anticipate there will probably
be another briefing before a ruling."

Mr. Gray said he would like to come to an agreement with the
U.S. Attorney's Office and present it to the judge.  "We are
certainly entertaining discussions with Mr. Gray," Mr. Doyle
said.


ALTA-DENA: Recalls Baskin-Robbins Ice Cream For Undeclared Eggs
---------------------------------------------------------------
Alta-Dena Certified Dairy Incorporated is voluntarily recalling
mislabeled quart containers of Baskin-Robbins brand ice cream
because they contain undeclared eggs. The ice cream is packaged
in a 2-piece quart container with a lid that identifies the
product as "Chocolate Chip Cookie Dough Ice Cream" and a cup
that identifies the product as "OREO r Cookies `n Cream Ice
Cream." The ice cream actually inside the container is
"Chocolate Chip Cookie Dough Ice Cream" and contains eggs that
are not listed as an ingredient on the label of the cup portion
of the container. No other products are involved in this
voluntary recall.

Individuals with allergies to eggs run the risk of a serious or
life threatening reaction if they consume this product. No
illness or allergic reactions have been reported.

Approximately 15,000 units of the recalled ice cream quart cup
containers may have been sold between September 9 th to the 29
th to consumers at Baskin-Robbins retail stores in Arizona ,
Alaska , California , Nevada and Utah . The recall was initiated
after the company discovered some Baskin-Robbins ice cream quart
cup containers were mispackaged with "Chocolate Chip Cookie
Dough Ice Cream" lids on "OREO r Cookies `n Cream Ice Cream"
cups.

Only quart cup containers of Baskin-Robbins "Chocolate Chip
Cookie Dough Ice Cream" containing the following sell by date
and plant number are involved in the recall. Consumers should
look for this information on the bottom of the container to
identify the product:

Mfg 29 Jul 04 Exp 29 Jul 05
7983 06-2238 Lots # 1-11 hh:mm

Consumers can return the product to their place of purchase for
a full refund or exchange. Consumers with questions may contact
Baskin-Robbins toll free at (800) 859 5339.

The quality of our products and safety of our consumers is our
foremost concern. The company will continue to work with the
retailers to resolve this issue as quickly as possible. The FDA
has been advised of this action.


ARIZONA: Yuma County Back Wages Legal Battle To Be Resolved Soon
----------------------------------------------------------------
A protracted class action lawsuit over back overtime wages owed
to hundreds of former and current Yuma County Sheriff's Office
employees may be resolved soon, according to observers familiar
with the case, the Yuma Sun reports.

A recommendation that will be going before Yuma County Board of
Supervisors is proposing to pay $431,823 in statutory interest
accrued over an eight-year span after a handful of sheriff's
deputies filed the suit against the county for overtime wages.

Filed in May 1996 on behalf of 11 deputies asking for $5.7
million, the suit later became a class action suit involving 650
former and current sheriff's deputies and corrections officers.

According to Bob Yen, a Phoenix-based attorney whose firm
represented the plaintiffs, Yuma County paid a court-ordered
settlement in December 2003 for $941,190. However, the county
still owes interest accrued since the time of the settlement,
and still unresolved is another $1.8 million in treble damages
the plaintiffs are seeking.

A trial concerning the $1.8 million in treble damages, slated to
begin on December 7 in Pima County Superior Court, has been
postponed through an agreement between Attorney Yen's firm and
Yuma County.

Attorney Yen, further adds "If we cannot reach (a settlement),
we will go forward with this in December. What we want to do is
reach this with the county in good faith. My clients have no
intention of bankrupting Yuma County. If the county can make a
reasonable offer, we'll recommend the case be settled."


ATLANTA: Emory Hospital To Inform 500 Patients of CJD Exposure
--------------------------------------------------------------
More than 500 patients at Emory University Hospital have a
remote chance of exposure to Creutzfeldt-Jakob disease, a fatal
disease similar to mad cow, hospital officials said, according
to the Associated Press.  The announcement was made after a
brain surgery patient tested positive for the condition.

Officials are notifying 98 brain or spinal surgery patients who
may have had contact with the surgical instruments that were
used on the infected patient.  The hospital is also informing
418 non-neurosurgical patients who had operations from September
10 to 27, although they are at lower risk.

The concern involves the naturally occurring or sporadic form of
Creutzfeldt-Jakob disease - not the variant form caused by
eating mad cow-infected meat.  Sporadic CJD, which has no known
cause, causes dementia, loss of muscle coordination and
eventually death.

According to Dr. Ermias Belay, an an epidemiologist with the
Centers for Disease Control and Prevention in Atlanta, there
have been four known cases worldwide of sporadic CJD spread by
neurosurgical instruments - all occurring in Europe before 1976,
when most hospitals began implementing new sterilization
procedures.  However, he added that more cases may have
occurred, but it's often difficult to trace the source of the
disease, which can take more than seven years to show symptoms,
AP reports.

Officials announced that the infected patient's September 15
diagnosis still awaits definitive test results and that could
take weeks.  The patient entered the hospital August 24 with
memory problems and other neurological symptoms, and officials
would not say if the patient was still alive.

"Although we believe the chances of an exposure are extremely
small, we cannot guarantee they are zero," said Dr. Allan Levey,
Emory's chairman of neurology, AP reports.  "That is why Emory
is taking every possible step to deal with this matter."

Affected patients began receiving phone calls Thursday.  Emory
said there was nothing they could or should do in response to
the notification, but said it would provide counseling for those
who need it.  They also stated that they routinely sterilize all
surgical equipment and have implemented an even more thorough
sterilization procedure since September 15.


BLACK BOX: PA Court Grants Final Approval To $2M Suit Settlement
----------------------------------------------------------------
Black Box Corporation (Nasdaq:BBOX), the world's largest
technical services company dedicated to designing, building and
maintaining today's complicated network infrastructure systems
revealed that the United States District Court for the Western
District of Pennsylvania entered a final order approving the
settlement of the case captioned In Re Black Box Corporation
Securities Litigation (Civil Action No. 03-CV-412).

The settlement provides for the payment of $2 million into a
settlement fund in exchange for a dismissal of the action with
prejudice and a full and complete release of any and all claims
against defendants. The Company's directors' and officers'
liability policy covered $1.5 million of the settlement payment,
with the remaining $500,000 being paid by the Company.

There having been no objections to the terms of the settlement
filed with the Court, the final order will become non-appealable
on October 12, 2004.


BRICKER ZAKOVICS: Agrees To Settle Former Clients Lawsuit in WA
---------------------------------------------------------------
Portland, Oregon law firm Bricker Zakovics Querin Thompson &
Ritchey (now known as Zakovics Thompson and Ritchey) agreed to
settle a class action filed against it and Burlington Northern &
Santa Fe Railway Co. in the United States District Court in
Seattle, Washington, The Oregonian reports.

The lawsuit refers to thousands of work-related hearing-loss
claims filed against U.S. railroads by workers in the 1980s and
early 1990s.  The suit was filed on behalf of the law firm's
former clients who were former railway employees who claimed
their work damaged their hearing.   The suit charged the firm
and Burlington Northern, one of the nation's largest railroads
of conspiring to limit awards to hundreds of former employees.
The two defendants allegedly created an illegal secret agreement
to cap the dollar amount of hearing-loss claims and limit the
railway's exposure.

Bricker Zakovics was commissioned by many workers in the
Northwest because of its longstanding relationship as a
"designated" firm among major railroad unions.  The firm filed a
number of lawsuits against Union Pacific, Burlington Northern
and other railroads in the 1980s, winning six-figure jury
verdicts for Union Pacific yard workers who suffered the most
severe hearing loss, the Oregonian reports.  In 1989 and 1990,
the firm settled about 4,000 claims by railroad workers against
Burlington Northern without taking any of them to trial, court
records indicate.

In 2001, the firm's former clients filed four separate federal
lawsuits against the firm and the railroad, which were later
consolidated.  The consolidated suit alleged the railroad and
the law firm illegally agreed on a "formula/matrix" designed to
limit the railroad's exposure "and richly reward BZQ for its
role in the scheme."  The suit charged Bricker Zakovics with
agreeing to avoid filing lawsuits in court, capping claims at
$65,000 and hiding the scheme from clients.

"If you can get a settlement quickly and get 25 percent of the
settlement and do very little work, you're going to get a lot
more money per hour than if you took it to trial," Craig R.
Spiegel, an attorney with Hagens Berman in Seattle, the firm
representing the workers, told The Oregonian.  Hagens Berman has
brought massive class actions against Enron and The Boeing Co.,
and it represented Oregon, Washington and 11 other states in
litigation against the tobacco industry.

Both Burlington Northern and Bricker Zakovics denied wrongdoing.
The firm's attorneys hired experts who found that Bricker
Zakovics' clients received average settlements of $24,165,
compared to average settlements of $14,564 for clients
represented by 25 other law firms nationwide that settled
hearing-loss claims with Burlington Northern, The Oregonian
reports.

The lawsuit hinges largely on testimony of a former Burlington
Northern claims director, Glenn McDonald, who negotiated 100 to
150 hearing-loss claims per month with Bricker Zakovics in 1989
and 1990. McDonald described during depositions an agreement
between the firm and the railroad that he said was kept
confidential to avoid angering rank-and-file railroad workers.

Seattle judge Marsha Pechman, in a series of rulings last year,
allowed some of the workers' claims to go to trial, at one point
ruling that "a reasonable fact-finder could conclude that Mr.
McDonald's testimony indicated the existence of a secret
agreement."  Mr. McDonald could not be reached for comment, The
Oregonian reports.

Judge Pechman preliminarily approved the settlement on September
20,2004.  The settlement covers about 800 former clients living
in Washington whose hearing-loss claims against the railroad
were handled by the firm in 1989 and 1990.  Under terms of the
settlement, about $375,000 of the firm's $1.5 million payment
will go to Hagens Berman for attorney fees and costs.  In
addition, each of the nine named plaintiffs will get a $5,000
incentive award.

Lawyers with the firm, now known as Zakovics, Thompson &
Ritchey, did not return calls seeking comment, The Oregonian
reports.  Monte Bricker, who retired from the firm in 1998, said
he was far removed from the matter and declined comment.

An attorney representing the firm, Robert E. Maloney, told The
Oregonian the firm believed it did nothing wrong.  However, he
said the firm's defense costs had exceeded its liability
insurance coverage.  "You've got a case that's been pending for
three years, and even though we were confident we'd win at
trial, they'd basically used up all their insurance money in
their defense," said Mr. Maloney of Lane Powell Spears Lubersky
LLP in Portland.

The proposed settlement does not resolve class action claims
against Burlington Northern, which involves 2,700 former workers
in Washington, Oregon and Montana who believe they were short-
changed by the alleged secret agreement.  The lawsuit asks the
court to nullify releases that the workers signed when they
settled in which they promised not to bring further claims
against the railroad, The Oregonian reports.

The case against Burlington Northern is scheduled to go to trial
in November.  A spokesman with Fort Worth, Texas-based
Burlington Northern on Wednesday said the railroad would
prevail.  "We don't believe there's any evidence to support the
class action," said Richard Russack, a spokesman for Burlington
Northern in Fort Worth, told The Oregonian.


CALIFORNIA: Monterey Judges File Suit To Regain Benefits, Wages
---------------------------------------------------------------
The county of Monterey in California faces a class action filed
by some of its judges, who are opposing the reductions they
absorbed earlier this year when the courts were moved under the
complete jurisdiction of the state, the Monterey Herald reports.

Judge Albert Maldonado filed a claim, alleging that they were
losing more than $15,000 a year because the county discontinued
paying its share of salaries and benefits on January 1, when the
state government started administering the court.

"The salaries and benefits are legally based as compensation,
which were illegally and unlawfully discontinued, cut off, and
reduced," according to Maldonado's claim.  Judges now are paid
$134,000 annually, according to court officials.

The state Judicial Council also filed a similar claim against
the county on behalf of all county judges.  "Because of the
county's failure to pay those judicial benefits, the Superior
Court and judges have suffered and continue to suffer damages,"
said Sue Hansen, supervising attorney for the Judicial Council,
in the claim, the Monterey Herald reports.

Neither the judges nor county officials were willing to discuss
the issue publicly, but the Board of Supervisors will decide
what to do with the claims when it meets in closed session on
Tuesday, the Monterey Herald states.  "The county is in sort of
an awkward situation," said Maia Carroll, a county spokeswoman.
"They are now state employees and they are asking for county
benefits."


CALIFORNIA: Participants Sought in Lawsuit V. Sheriff's Office
--------------------------------------------------------------
Plaintiffs' attorneys are sending out letters seeking
participants for their class action suit against the San
Francisco County Sheriff's Office, alleging illegal strip
searches, the Associated Press reports.

According to the attorneys, the letters will help identify a
pool of former inmates who were arrested for relatively minor
crimes and strip-searched without evidence they were hiding
drugs or weapons.

The class action suit against the San Francisco County Sheriff's
Office comes on the heels of a San Francisco Chronicle
investigation last year, which revealed that the Sheriff's
Department for years had conducted inappropriate and sometimes
illegal strip searches.

Under state law, strip searches and visual body-cavity searches
of people held before arraignment on misdemeanors, except for
those cases involving weapons, controlled substances or violence
are prohibited.

In June, a federal judge approved class action status for the
suit. Similar lawsuits are pending in San Mateo and Marin
counties.  In light of the revelations by the San Francisco
newspaper's investigation, the jail has since revised its
policies.


CLARENT CORPORATION: SEC Files Suit V. Ex-CFO, Asia Pacific Head
----------------------------------------------------------------
The Securities and Exchange Commission filed a complaint against
Jerry S. Chang, the former Chief Executive Officer of Clarent
Corporation (Clarent), for violating the Securities and Exchange
Act of 1934. The complaint alleges that from December 2000
through August 2001, Chang caused Clarent to record fraudulently
approximately $13 million in phony revenue, violated internal
control procedures resulting in the loss of over $35 million in
cash and caused Clarent to fail to disclose an $11 million
liability.

In addition, the complaint alleges that Chang promised a
customer that Clarent would arrange for a third party company,
in which another Clarent executive and his family had control,
to buy Clarent's product from the customer.

The complaint charges Chang with violating the antifraud,
corporate reporting, books and records and internal control
provisions of the federal securities laws, and seeks
injunctions, disgorgement and monetary penalties.

In particular, the Commission asserts claims against Chang for
violations of Sections 10(b), 13(b)(5) of the Securities
Exchange Act of 1934 (Securities Act) and Rules 10b-5, 13b2-1
and 13b2-2 thereunder as well as for aiding and abetting
violations of Sections 10(b), 13(a) and 13(b)(2)(A) of the
Exchange Act and Rules 12b-20, 13a-1 and 13a-13 thereunder.

In a related matter, the Commission filed a separate action
against the former President of Clarent's Asia Pacific office,
Matthew M. Chiang, charging him with violating, or aiding and
abetting violations of, the antifraud, corporate reporting,
books and records and internal control provisions of the federal
securities laws (SEC v. Matthew M. Chiang, No. C 04-4145 SI,
USDC, N.D. Cal.; LR-18915). The action against Mr. Chang is
titled, SEC v. Jerry S. Chang, No. C 04-4144 MHP, USDC, N.D.
Cal., San Francisco Division.


GAY ADOPTION: ACLU Asks High Court To Hear Challenge on 1977 Law
----------------------------------------------------------------
The American Civil Rights Union (ACLU) asked the United States
Supreme Court to hear its opposition to Florida's ban on
adoptions by gays, the Associated Press reports.

In 1977, Florida adapted a law completely banning adoption by
gays, either as couples or as single parents.  In a 40-page
filing, the ACLU stated that the law violates the Constitution's
equal protection clause because it singles out one class of
people, homosexuals.  The filing also stated that children are
also disadvantaged because they are deprived of caring parents.

The ACLU asks the Supreme Court to "make it clear once and for
all that states may not pass laws to express their disapproval
of gay people and particularly may not do that on the backs of
society's least fortunate."

In July, the 11th U.S. Circuit Court of Appeals refused in a 6-6
vote to hear the challenge after a three-judge panel ruled
against four gay men, foster parents seeking to adopt children
in their care.  The panel had ruled the question should be
decided in the legislature.  The Supreme Court is expected to
decide whether to hear the appeal by early January.


GREAT ATLANTIC: Settles Canada Franchisee Suit For $32 Million
--------------------------------------------------------------
The Great Atlantic & Pacific Tea Co. (now doing business as A&P)
reached a US$32 million settlement for a class action filed
against it, by 29 operating and former franchisees of Food
Basics discount grocery stores in Ontario, Canoe.ca reports.
The dispute revolved around terms of their franchise agreement.
The settlement is subject to court approval.

"The resolution of this matter enables us to continue growing
our strong discount business in Ontario with a larger complement
of corporately owned stores, while at the same time
strengthening our continuing franchise stores," Christian Haub,
chairman and CEO of A&P, said in a release, canoe.ca reports.


GROH ASSET: SEC Issues Administrative Order Against Roger Groh
--------------------------------------------------------------
The Securities and Exchange Commission issued an Order
Instituting Administrative and Cease-and-Desist Proceedings,
Making Findings, and Imposing Remedial Sanctions and a Cease-
and-Desist Order Pursuant to Sections 203(e), 203(f), and 203(k)
of the Investment Advisers Act (Order) against Groh Asset
Management, Inc. (GAM) and Roger O. Groh. The Order finds that
GAM willfully violated, and Groh willfully aided and abetted
GAM's violations of, Sections 206(2) and 206(4) of the Advisers
Act and Rule 206(4)-1(a)(5) thereunder by overstating GAM's
assets under management to entities in the business of gathering
and publishing information about investment advisers and money
managers. GAM's violations persisted despite the fact that GAM
and Groh received deficiency letters following an examination by
the Commission's compliance staff citing them for overstating
assets under management and requiring corrective action. The
Order also finds that GAM willfully violated, and Groh willfully
aided and abetted GAM's violations of, Section 204 of the
Advisers Act and Rule 204-2(a)(11) by failing to maintain copies
of questionnaires, surveys, and other communications with
publications that made information about GAM available to the
public.

Based on the above the Order censures GAM and Groh and directs
them to pay together a $45,000 civil penalty and cease and
desist from future violations. The order also directs GAM to
comply with certain undertakings:

     (1) to retain an independent consultant to review GAM's
         advertising and marketing materials and to monitor
         GAM's compliance with books-and-records requirements
         for a period of five years; and

     (2) to distribute the administrative Order to GAM's clients
         and potential clients for one year. GAM and Groh
         consented to the issuance of the Order without
         admitting or denying any of the findings in the Order.


HEDSTROM CORPORATION: CA Court Approves CCA Lawsuit Settlement
--------------------------------------------------------------
A class action settlement has been approved by the Orange County
Superior Court that provides for cash payments to all persons in
California who purchased certain wood playground equipment
manufactured by Hedstrom Corporation, according to the Lakeshore
Law Center.

The original class action lawsuit was brought by representative
plaintiffs, on behalf of the general public who purchased
playground equipment between July 24, 1999 and July 24, 2003
that was manufactured by Hedstrom, and sold by Toys "R" Us and
other retailers, and that was made of wood treated with
Chromated Copper Arsenate (CCA). The advertisements for this
equipment did not disclose the presence of CCA.

CCA is a chemical preservative that protects wood from rotting
due to insects and microbial agents. CCA contains arsenic,
chromium and copper. There is a scientific controversy regarding
whether the arsenic in CCA treated wood presents a health
hazard.

Plaintiff alleges that the advertisements were deceptive within
the meaning of the Unfair Competition Law. Plaintiff further
alleged the advertisements violated the Consumer Legal Remedies
Act; including subdivisions (a) (5) and (a) (7) of Civil Code
section 1770.

All persons who purchased wood play sets from Toys R Us or
similar stores between July 1999 and July 2003 should call 1-
800-768-5658 for additional information on submitting a claim
for compensation. Information can also be downloaded from the
Internet website at www.hedstromplayequipmentsettlement.com.

The deadline to submit a claim is November 21, 2004. Consumers
who submit valid claims will typically receive between $50 and
$100. There is no purchase obligation. The payments are pursuant
to a court order. Further information is also available from the
Lakeshore Law Center at 714-854-7205.


ILLINOIS: Court Junks Race Bias Lawsuit V. Grand Victoria Casino
----------------------------------------------------------------
The United States District Court in Illinois dismissed a
discrimination lawsuit filed against the Grand Victoria Casino
in Elgin, Illinois, alleging discrimination against blacks who
applied for dealer positions at the casino, the Chicago Daily
Herald reports.

U.S. District Court Judge Martin C. Ashman dismissed the suit,
ruling that one plaintiffs' history of job hopping at several
casinos and another's daytime teaching job may have been
legitimate reasons for the Grand Victoria not to hire them, and
did not show a pattern of discrimination, the Casino City Times
reports.  Plaintiffs wanted the case to be certified as a class
action suit, and at one point there were 37 parties to the case.


LIBERATE TECHNOLOGIES: SEC Lodges Fraud Charges V. Ex-Executives
----------------------------------------------------------------
The Securities and Exchange Commission filed financial reporting
fraud charges against two former high-ranking executives of
Liberate Technologies, a San Carlos, California-based company
that sells software and services for interactive television.
Alleged to have participated in a scheme to fraudulently inflate
Liberate's revenue over four successive quarters in 2002 and
2003 are former Chief Operating Officer and head of sales Donald
M.  Fitzpatrick, of Sydney, Australia, and former sales vice
president Thomas R. Stitt of Redwood City, California. Stitt has
reached a settlement of the charges against him.

The Commission's complaint, which was filed in the U.S. District
Court for the Northern District of California, alleges that
Fitzpatrick, on his own and with assistance from Stitt on
several deals, devised a series of fraudulent transactions to
inflate Liberate's quarterly and year-end financial results.  As
a result, Liberate's quarterly revenue was artificially inflated
by as much as 17% during the company's 2002 and 2003 fiscal
years. Liberate ultimately restated its financial statements in
September 2003 to reverse and defer revenue from the fraudulent
transactions.

According to the complaint, Fitzpatrick employed various devices
to inflate Liberate's reported results.  For instance,
Fitzpatrick, aided by Stitt, effectuated an improper "round-
trip" deal whereby Liberate supplied its customer with the money
to make the purchase. In this sham deal, Liberate received no
net economic benefit, essentially using its own funds to create
the false appearance of legitimate revenue. In another
fraudulent transaction, Fitzpatrick negotiated a side agreement
with a customer that granted the customer future financial
concessions, and then hid the agreement from Liberate's finance
department. The concessions Fitzpatrick secretly granted, if
accounted for properly, would have wiped out the revenue
Liberate reported to the public for the sale.

The complaint also alleges that Fitzpatrick and Stitt lied to
Liberate's outside auditors and to Liberate's own financial
group, which enabled the fraud to remain undetected.

The Commission's complaint charges Fitzpatrick with securities
fraud and lying to accountants. The complaint seeks injunctive
relief, civil monetary penalties, disgorgement of Fitzpatrick's
ill-gotten gains (including commissions and bonuses), and an
order barring Fitzpatrick from serving as an officer or director
of a public company.

Stitt is charged in the Commission's complaint with violating
the antifraud provisions of the federal securities laws and with
aiding and abetting Liberate's reporting of false financial
information to the Commission and Liberate's failure to maintain
accurate books and records and internal controls. The complaint
additionally charges him with lying to accountants,
circumventing accounting controls, and falsifying the company's
books and records. Without admitting or denying the allegations,
Stitt agreed to pay a total of $78,000, including  $28,000 in
disgorgement and a $50,000 civil monetary penalty. Stitt also
agreed to the entry of a court order barring him from serving as
an officer or director of a public company for 10 years and
enjoining him from future violations of these laws.

The Commission's district court complaint charges Fitzpatrick
with securities fraud (Section 17(a) of the Securities Act of
1933 and 10(b) of the Securities Exchange Act of 1934 (Exchange
Act) and Rule 10b-5 thereunder) and lying to accountants (Rule
13b2-2). The Commission's action charges Stitt with the same
Exchange Act violations as well as violations of other Exchange
Act provisions and rules, specifically, aiding and abetting
Liberate in filing false periodic reports under Section 13(b) of
the Exchange Act and Rules 12b-20, 13a-1, and 13a-13; aiding and
abetting Liberate in maintaining inaccurate books under Section
13(b)(2)(A) of the Exchange Act; aiding and abetting Liberate in
having inadequate internal accounting controls under Section
13(b)(2)(B) of the Exchange Act; and circumventing internal
accounting controls under Section 13(b)(5) of the Exchange Act
and Rule 13b2-1.

The U.S. Attorney's Office for the Northern District of
California, and the Federal Bureau of Investigation, today also
announced criminal charges against Fitzpatrick for his role in
the financial reporting fraud.

The Commission acknowledges the assistance of the Federal Bureau
of Investigation and the U.S. Attorney's Office for the Northern
District of California. The action is titled, SEC v. Donald M.
Fitzpatrick and Thomas R. Stitt, Civil Action No C 04 4120 BZ,
USDC, NDCA.


LOUISIANA: Gay Rights Activists Fight Outlawing of Gay Unions
-------------------------------------------------------------
Gay rights activists challenged in court a recently passed
Louisiana constitutional amendment outlawing gay marriages and
civil unions, the Associated Press reports.

The suit focuses on several issues rejected by state courts as
premature before the September 18 election, attorney Randy Evans
told AP.  They include the contention that the amendment was
illegally adopted by the Legislature because it included more
than one purpose - banning civil unions as well as marriages -
and that it was illegally placed on the ballot for a day when
there was not a statewide election already scheduled.  The suit
also mentions problems with the election in New Orleans, where
voting machines were delivered late at many precincts.

A spokeswoman for the Attorney General's office declined comment
on specifics of the lawsuit but said the amendment will be
vigorously defended, AP reports.

The marriage amendment passed with 78 percent of the vote and is
scheduled to take effect on October 18.  Louisiana is one of
several states with gay marriage bans on the ballot this year.
The overwhelming approval followed an intense grass roots
lobbying campaign by Christian conservatives.


MERCK & CO.: Lawsuits Over Vioxx Use Surface Right After Recall
---------------------------------------------------------------
The foreseeable lawsuits over Merck & Co.'s wonder drug, Vioxx
has started, the first of which came just a day after the drug
was recalled from use last week, the Associated Press reports.

A Missouri woman, who sued the maker of arthritis drug Vioxx
over the 2002 death of her daughter, filed one such suit just a
day after Merck & Co. pulled the medication from shelves over
fears users faced increased risk of heart attack and stroke.

Caroline Nevels, of Lexington, claims that her 34-year-old
daughter, Shelly South, took Vioxx for 2 years before dying of a
heart attack in November 2002 and that Merck knew of the risks
of Vioxx long before its announcement recent recall of the drug.
Even though she is the only named plaintiffs, Mrs. Nevels filed
the suit as a class action that seeks unspecified compensatory
and punitive damages and money for medical monitoring of Vioxx
users.

According to Kenneth McClain, the plaintiff's attorney, the suit
was the first of its kind in the state of Missouri, he however
pointed out that similar lawsuits are in the works across the
country. One attorney even claims to represent 58 patients
around the United States who say they have been harmed by Vioxx,
including people who suffered a heart attack, stroke, internal
bleeding or kidney failure.

Also named in the suit is the physician who prescribed the drug
to Mrs. Nevels' daughter, which she accused of failing to
diagnose the severity of her daughter's heart condition and
prescribed Vioxx despite her medical history.


MINNESOTA: ACLU Sets Up Office To Investigate Racial Profiling
--------------------------------------------------------------
The American Civil Liberties Union of Minnesota has set up an
office outside the Twin Cities, solely to gather complaints of
racial profiling against Native Americans by police and
sheriff's deputies, the Associated Press reports.

According to an analysis by the University of Minnesota and the
nonprofit Council on Crime and Justice of traffic stops in 2002,
in cities and counties bordering the Red Lake, Leech Lake and
White Earth Ojibwe reservations, Indians were stopped and
searched at disproportionately higher rates than white drivers,
though the rate of finding contraband in an Indian vehicle was
no higher.  Arrest figures from six area counties in 1999 - the
latest data publicly available in such detail - showed that
Indians accounted for 32 percent of arrests while making up just
12 percent of the population.

"This is a situation that stinks in Minnesota," said Charles
Samuelson, executive director of the Minnesota ACLU, according
to AP.  "They get stopped at a little higher percentage than
whites, searched at a higher percentage, arrested at a little
higher percentage. At every opportunity where discretion can
enter into it, the people of color lose."

Bemidji Police Chief Bruce Preece asserted that law officers
were merely doing their jobs, and ticketing or arresting people
who break the law.  "I can assure you that in my experience in
three years as chief of police I have not seen any racial
profiling by my department or the sheriff's department," said
Mr. Preece, according to AP.  "We do not condone it."

Cass County attorney Earl Maus attributed the arrests to the
poverty of much of the Indian population.  "People who live in
poverty generally have a higher rate of crime," he said,
according to AP.  Indians made up 11 percent of the population
in 1999 but accounted for more than half the arrests in Cass
County.

Mr. Preece added that the traffic stop analysis underestimated
the number of Indians who drive through his city.

The ACLU hired a coordinator, Audrey Thayer, in May to look into
the profiling complaints. The office opened in Bemidji on
September 7 in a two-year, $190,000 effort.  Thayer, a 52-year-
old Ojibwe woman, spends most of her time seeking out stories.
She has canvassed the poor at a soup kitchen, questioned Indians
waiting to see relatives in jail, and handed out fliers to teens
hanging out late at night.  Ms. Thayer said she often hears of
law enforcement officers who use feeble excuses, like burned-out
license plate lights, to stop and question Indian drivers, AP
reports.

Tom Johnson, president of the Council on Crime and Justice, said
one reason Indians are being pulled over more may be that law
enforcement officers believe that Indians - because of their
high rates of alcoholism - are more likely to drink and drive.
Also, because many Indians are impoverished, they may be more
likely to drive poorly maintained cars with broken equipment,
and that may be giving police excuses to pull them over, he told
AP.

Maus, the prosecutor in Cass County, said of the ACLU project:
"If they can come in here and show us some way to do things
better, we'd be grateful."

NEW YORK: Rensselaer County Reaches Pact For Strip Search Suit
--------------------------------------------------------------
More than 800 former inmates at the Rensselaer County Jail who
were illegally strip-searched will get one thousand dollars each
in a court settlement, the Associated Press reports.

The inmates are set to share the $80,000 settlement, while their
attorneys are to get $372,000. The settlement, which has been
approved by US District Judge Thomas McAvoy ends a class action
lawsuit filed in June 2002 accusing jail guards of conducting
blanket strip searches and body cavity examinations on thousands
of inmates from June 26th, 1999 to July 1st, 2002.  Some of the
plaintiffs in the case also claim that they were ridiculed about
the size of their genitals, body shapes and odors while being
searched.

The claims will be paid through the county's insurance carrier
with unclaimed funds going back to the county, AP reports.


PHILIP MORRIS: Six IL Justices To Decide Appeal $10.1 B Verdict
---------------------------------------------------------------
Only six of the seven justices of the Illinois Supreme Court are
likely to decide an appeal of the mammoth Philip Morris verdict
from Madison County, according to legal experts, the St. Louis
Post-Dispatch reports.

In a related matter, the Supreme Court recently denied a defense
motion to bar the Chicago firm, Power Rogers & Smith, which
represents Supreme Court Justice Robert Thomas in Kane County
suit, from the Philip Morris appeal.

Republican Robert R. Thomas, the one justice who will not decide
the case, is expected to recuse himself from it due to a
conflict of interest. The issue is over the firm's
representation of Supreme Court Justice Robert Thomas in a libel
case filed in January against the Kane County Chronicle.
(September 3, 2004 CAR)

Philip Morris, who wants to keep the judge on the case argued in
its motion that the St. Louis firm, Korein Tillery, brought in
Power Rogers & Smith knowing that it would result in Justice
Thomas' recusal. The Company said the hiring "gives rise to an
appearance of impropriety."

Last year, Korein Tillery of St. Louis won a state record $10.1
billion verdict from Circuit Judge Nicholas G. Byron in a class
action suit that alleged Philip Morris had deceived Illinois
smokers about the dangers of light cigarettes.

Former Illinois Gov. James R. Thompson, an attorney for Philip
Morris and chairman of the law firm of Winston & Strawn, claims
that the only reason the Power firm was brought in to the case
was to disqualify Justice Thomas, one of two Republicans on the
court, which had the effect of making Philip Morris' appeal a
lot harder only six justices.

However, the Power firm denied Mr. Thompson's claims by telling
the Supreme Court that the firm had been approached about
joining in the appeal of the case in September last year, months
before Power agreed to represent Thomas in his suit.


PIZZA HUT: CA Court Denies Appeals For RGM, RTM Overtime Lawsuit
----------------------------------------------------------------
In an Order entered on Sept. 17, 2004, the U.S. District Court
denied Pizza Hut's Motions for reconsideration and immediate
appeal of a previous ruling on July 15, 2004, in a nationwide
class action case filed by their current and former Restaurant
General Managers (RGMs) and Restaurant Training Managers (RTMs)
for unpaid overtime, according to Lawfirm Castle, Petersen &
Krause LLP.

On July 15, 2004, Judge Terry J. Hatter Jr. of the U.S. District
Court for the Central District of California ruled that Pizza
Hut Inc. misclassified its RGMs and RTMs as exempt employees,
even though the vast majority of their time was spent making
pizzas, taking orders, providing customer service, cleaning the
store and performing other production-related, non-exempt tasks.
This ruling entitles Pizza Hut RGMs and RTMs to overtime
compensation for all hours worked over 40 hours in any given
workweek.

Castle, Petersen & Krause LLP originally brought the case to
court on behalf of Ann Coldiron, a former RGM for Pizza Hut, to
recover unpaid overtime wages. Coldiron and other similarly
situated current and former RGMs and RTMs worked in excess of 50
hours per week without overtime pay.

As a result of the recent Sept. 17 ruling, the case will now
progress to the phase in which the amounts of unpaid overtime
Pizza Hut owes its current and former RGMs and RTMs will be
determined. A successful prosecution of this case will result in
each current and former RGM and RTM standing to collect a
substantial sum of money from Pizza Hut for all of the unpaid
overtime hours they worked.

Based on information currently available, current and former
RGMs and RTMs who have joined this action are entitled to
approximately $100,000 each. In order to be eligible to collect
the unpaid overtime compensation, the current and former
employees must sign-up to join this action as a plaintiff.

The current estimation of the total overtime wages Pizza Hut
owes its current and former RGMs and RTMs is approximately $300
million. The courts have allowed similar class actions against
other large corporations such as Wal-Mart, Taco Bell, Lowes,
Farmers Insurance, Paine Webber and Radio Shack, because
management avoided federally mandated overtime pay to its
employees by granting managerial-sounding titles.


REDDI BRAKE: Finalizes Settlement of CA Shareholder Fraud Suit
--------------------------------------------------------------
Reddi Brake Supply Corporation finalized the settlement of the
class action filed against it in the Los Angeles Superior Court
in California, styled "McCormick, et al., v. Reddi Brake Supply
Corp., et al, L.A.S.C. Case No. BC 180840."

The suit was filed on behalf of all persons or entities who
bought common stock of the defendant prior to March 23, 1996,
and/or who bought or sold any shares thereafter until August 13,
1996, excluding defendants, their families, employees, agents or
assigns.  The complaint asserts causes of action for breach of
fiduciary duty by officers and directors and conspiracy to
manipulate the price of the common stock of the defendant.

The Reddi Brake Defendants have denied the claims.  In May 1999,
the parties reached a tentative settlement agreement, which was
presented to the Court in June 1999 and in September 1999, and
received preliminary approval by the Superior Court as fair,
reasonable and adequate to members of the settlement class.

In December 2000, named class members announced their intention
to renegotiate certain provisions of the settlement.  In January
2001, defendants served notice of their withdrawal from the
settlement.  In June 2001, the Superior Court rejected the
proposed settlement, found the plaintiffs' counsel inadequate,
decertified the settlement class, and ordered the class action
allegations stricken from the complaint.

In July 2001, the named plaintiffs obtained new counsel and, in
March 2002, the parties entered into a new tentative settlement
agreement, which was preliminarily approved by the Superior
Court as a fair, reasonable, and adequate to members of the
settlement class in June 2003. The parties have requested that
the Superior Court enter an order of final approval of the
settlement.

Until the Superior Court final approval of the settlement is
entered, Defendants, including Reddi Brake, have the right to
withdraw from the settlement upon the occurrence of events
specified in the tentative settlement agreement, which is on
file with the Superior Court.

On December 22, 2003 the Superior Court of the State of
California for the County of Los Angeles entered a final order
approving a settlement between the parties as fair, reasonable
and adequate to absent class members and entered a final
judgment.  The settlement became effective on February 23, 2004
sixty days after the December 22, 2003 order, which allowed for
an appeal of the courts final order and judgment.  The terms of
the settlement provides for payment of all settlement
considerations by the Company's insurance.


SOUTHWESTERN BELL: Judge Approves $21.7M Yellow Pages Settlement
----------------------------------------------------------------
Jackson County Circuit Court Judge Tom Clark approved a $21.7
million settlement for a class action lawsuit that claimed
Southwestern Bell Advertising bilked advertisers out of more
than $20 million in late fees, the Associated Press reports.

Under the settlement, class members can receive direct cash
payments or account credits.

Two Kansas City, MO-area companies filed the initial suit in
November 2001, Liberty Cellular Inc. and Blast Inc., who are
both claiming that SBC violated its contract by charging a $25
late fee to advertisers who didn't pay their bills on time.
Furthermore, the plaintiffs claimed that the late fees were
falsely listed as collection activity fees on customer invoices.

Last year, Judge Clark ruled that the billing was "inherently
deceptive" and that customers paid "without full knowledge of
the facts." The suit was eventually given class-action status,
representing thousands of Yellow Pages advertisers in Missouri,
Kansas, Arkansas, Oklahoma and Texas.

Southwestern Bell stopped charging the collection activity fees
in December and has agreed not to pursue collection of fees that
had been charged but not collected.


SPECTRUM BRANDS: SEC Sues Attorney, Promoters For Anthrax Hoax
--------------------------------------------------------------
The Securities and Exchange Commission filed a civil action
against an attorney, Robert J. Cassandro, two stock promoters,
Michael C. Cardascia and Stephen E. Apolant in a case that arose
out of a fraudulent scheme to manipulate the price of Spectrum
Brands Corporation's stock by exploiting the fear of bio-
terrorism following Sept. 11, 2001.

Specifically, the complaint alleges that Spectrum Brands was
secretly managed and controlled by a group of stock promoters in
Hicksville, New York, some of whom were convicted felons. The
complaint further alleges that to conceal its true ownership
from the investing public, Spectrum Brands stated in a Form 8-K
filed with the Commission on or about Oct. 31, 2001, that a
Michael J. Burns was the sole officer and director of the
company and that the corporate address was in Hauppauge, New
York. In truth, Burns had little or no management responsibility
for Spectrum Brands and the Hauppauge address was a mail drop.

The complaint alleges that Cassandro participated in drafting
the false and misleading statements in the Form 8-K while
knowing that the statements were false and misleading. Also,
according to the complaint, Michael Cardascia and Apolant helped
promote Spectrum Brands stock via internet, radio, bulk e-mail,
and fax while knowing that these communications contained false
and misleading statements regarding the identity of the persons
controlling and managing Spectrum Brands. The complaint also
alleges that Michael Cardascia bought Spectrum Brands stock
privately at a discount and that his wife Joan Cardascia, who
was named as a relief defendant, was unjustly enriched when she
sold it at inflated prices.

The Commission charged Cassandro with primary and aiding and
abetting violations of Section 10(b) of the Securities Exchange
Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. The
Commission charged Michael Cardascia and Apolant with aiding and
abetting violations of Section 10(b) of the Exchange Act and
Rule 10b-5 thereunder. The Commission seeks permanent
injunctions, an accounting of all gains garnered, disgorgement
of such gains, with prejudgment interest, and civil money
penalties. The Commission also seeks an order providing that
Joan Cardascia disgorge the amount by which she was unjustly
enriched, with prejudgment interest. This case is related to SEC
v. Spectrum Brands Corp., Saverio (Sammy) Galasso III, David
Hutter  (a/k/a David Green), Charlie Dilluvio and Michael J.
Burns, Civil Case No.  CV-01-8257 (Spatt, J.)(E.D.N.Y. filed
December 11, 2001)[LR - 17265), in which the Commission alleged
that, among other things, Spectrum Brands falsely claimed that
it had a product that could "wipe out surface germs in less than
5 seconds, including anthrax." [SEC v. Robert J. Cassandro,
Michael C. Cardascia, and Stephen E. Apolant, Defendants, and
Joan Cardascia, Relief Defendant, Civil Case No. CV-04-4199
(Spatt, J.) EDNY]


TOBACCO LITIGATION: MO Court Refuses Damages in Smokers Lawsuit
---------------------------------------------------------------
The United States District Court for the Eastern District of
Missouri ruled that Brown & Williamson Tobacco Corporation was
not responsible for the death of St. Louis resident Stella Hale,
who died of lung cancer in 2001 at age 53, the Associated Press
reports.

Tracey A. Mash and Anjanetta Lingard, two of Ms. Hale's
daughters, filed the suit last year charging the Company with
failing to adequately warn their mother of the risks of smoking.
Ms. Hale smoked the company's "Kool" cigarettes.

The suit is the first individual smoker case to be tried since
the Company merged with R.J. Reynolds Tobacco Co.  The Company
asserted that Ms. Hale had known of the potential health risks
of smoking and chose to smoke anyway, according to a statement
from Reynolds Tobacco.  The court sided with the Company and did
not award any damages to the plaintiffs.

Phone calls to Mash and Lingard's lawyers were not immediately
returned, according to AP.  Jeff Rayborn, senior counsel for
Reynolds Tobacco Co., said the ruling "underscores the strength
of our defenses in these individual cases."

Edward L. Sweda, senior attorney for the Tobacco Products
Liability Project, a nonprofit at Northeastern University in
Boston that encourages litigation to hold tobacco companies
accountable, had not reviewed the St. Louis case, but said the
fact that the ruling came after the merger is irrelevant.  "It's
no guarantee of future success," he said, AP reports.

A Winston-Salem-based parent company, Reynolds American Inc.,
was created July 30 by the merger of R.J. Reynolds Tobacco Co.
and the U.S. operations of Brown & Williamson Tobacco Corp.  The
merger created the second-largest tobacco company in the nation.


UNION PACIFIC: Settlement Overseers Reject 241 "Dubious" Claims
---------------------------------------------------------------
Lawyers overseeing the $65 million class action settlement for
the May 2000 Eunice train derailment recently threw out 241
claims for money, the Lafayette Daily Advertiser reports.  The
claims were rejected after hearings in which 451 people mostly
out-of-towners were questioned on whether they were actually in
Eunice at the time of the derailment.

According to one of the attorneys, Terry Hoychick, "If they said
they were at Wal-Mart at seven at night, well, they couldn't
have been," adding that Wal-Mart locked its doors at 2 p.m.
after an evacuation of the city was ordered when rail cars
carrying hazardous chemicals derailed.

An estimated 12,200 people have submitted claims in the
settlement, which Union Pacific Railroad Company agreed to
earlier this year.  Attorney Hoychick further stated that of the
451 people summoned to answer questions last month about their
claim for a part of the settlement, 79 were rejected because of
inconsistencies and 162 were rejected because they failed to
show up in court. He also stated that 197 claims were allowed to
stand and 13 have been rescheduled for a later hearing.

Another attorney Kenneth Dejean, who was appointed to help
manage the payout, said that the number of rejections, which was
more than half of the questionable claims picked out for
scrutiny has prompted considerations for a second round of
hearings.


WASTE MANAGEMENT: Former VP Settles SEC Civil Enforcement Action
----------------------------------------------------------------
The Commission announced today that on September 28 the U.S.
District Court for the Northern District of Illinois entered
final judgment as to defendant Bruce D. Tobecksen in the federal
civil enforcement action filed by the Commission. Tobecksen was
the former vice president of finance at Waste Management, Inc.
("Waste Management" or "Company).

The Judgment permanently bars Tobecksen from acting as an
officer or director of a public company and enjoins him from
future violations, or aiding and abetting violations, of
Sections 10(b), 13(a), 13(b)(2)(A) of the Securities Exchange
Act of 1934, Rules 10b-5, 12b-20, 13a-1, 13a-13, and 13b2-1
promulgated thereunder, and Section 17(a) of the Securities
Act of 1933. The Judgment also requires Tobecksen to pay
disgorgement in the amount of $403,179, prejudgment interest
thereon in the amount of $285,980, and a $120,000 civil penalty.
Tobecksen consented to the Judgment without admitting or denying
the allegations in the Commission's complaint.

The complaint in this action, which was filed on March 26, 2002,
charges the founder, Tobecksen, and four other former top
officers of Waste Management with perpetrating a massive
financial fraud lasting more than five years. The Commission
alleges that, beginning in 1992 and continuing into 1997,
defendants engaged in a systematic scheme to falsify and
misrepresent Waste Management's financial results with profits
being overstated by $1.7 billion. The fraud resulted in what at
the time was the largest restatement in history.

The Commission's litigation is continuing as to the five other
former executives of Waste Management:  SEC v. Dean Buntrock, et
al., Civil Action No. 02-C-2180, N.D. Ill. (Andersen, J.)


WILLIAMS COMPANIES: Court Sets Oct. 28 Lead Plaintiff Deadline
--------------------------------------------------------------
Pursuant to order of the Court in "In re Williams Securities
Litigation," Case No. 02-72-cv-H(M) (WMB Subclass), United
States District Court for the Northern District of Oklahoma
(consolidating a number of securities class actions originally
filed in February, 2002), notice is hereby given that any
"Purchaser" (defined below) of certain securities of The
Williams Companies, Inc. ("WMB") between July 24, 2000 and July
22, 2002 may apply to be replacement "lead plaintiff" for the
WMB Subclass, by filing an appropriate motion for "lead
plaintiff" status with the Court Clerk, 333 West Fourth Street,
Tulsa, Oklahoma 74103, on or before October 28, 2004.

The Consolidated Amended Complaint (WMB Subclass) alleges causes
of action under the Securities Act of 1933 and the Securities
Exchange Act of 1934. Matters pertaining to service as "lead
plaintiff" in a federal securities class action case are set
forth in the Private Securities Litigation Reform Act of 1995,
Title 15 United States Code, Section 78u-4.

"Purchaser" is defined as follows:

     (1) Any purchaser of WMB common stock during the period
         July 24, 2000 and July 22, 2002.

     (2) Any purchaser of WMB common stock in or traceable to
         WMB's offering of common stock on or about January 16,
         2001.

     (3) Any purchaser of WMB common stock issued or traceable
         to the exchange of WMB common stock for common stock of
         Barrett Resources Corporation on or about August 2,
         2001.

     (4) Any purchaser of $750 million WMB 7.125% Notes due
         September 1, 2011 and/or of $750 million WMB 7.875%
         Notes due September 1, 2021, issued or traceable to the
         offering of such securities on or about August 16,
         2001.

     (5) Any purchaser of WMB FELINE PACS issued or traceable to
         the offering of such securities on or about January 7,
         2002.


                    New Securities Fraud Cases


AQUILA INC.: Wolf Haldenstein Lodges Securities Fraud Suit in MO
----------------------------------------------------------------
The law firm of Wolf Haldenstein Adler Freeman & Herz LLP filed
a class action lawsuit in the United States District Court for
the Western District of Missouri, on behalf of all participants
and beneficiaries of the Retirement Investment Plan (the "Plan")
of Aquila, Inc. ("Aquila" or the "Company") (NYSE: ILA),
formerly known as UtiliCorp United, Inc., between January 1,
1999 and May 5, 2004, inclusive (the "Class Period"), against
defendant Aquila and certain officers and directors of the
Company. The Plan was formerly known as the UtiliCorp United,
Inc. Retirement Investment Plan.

The case name and index number are Itteilag v. Aquila, Inc., et
al., 04- cv-00865.

The Wolf Haldenstein case was recently the subject of an article
in the Kansas City Star dated September 28, 2004, entitled "Suit
Blames Aquila For Losses."

The detailed 98 page Complaint alleges claims against the
Company and other defendants for breaches of fiduciary duties
owed to the Plan, and is the result of an extensive
investigation conducted by the Wolf Haldenstein firm with the
active participation of plaintiff Richard Itteilag. "This action
would not have been brought if it were not for the in depth
investigation over the course of several months which culminated
in my decision to initiate this action by filing the Complaint,"
commented Mr. Itteilag. "My lawsuit is for participants in the
Plan. I have every confidence that together with my attorneys,
who will vigorously prosecute this action, we will obtain an
important recovery for the many current, and former, Aquila
employees who suffered devastating losses."

Two days after the Kansas City Star story, several other firms,
in apparent reliance on the Complaint filed by Wolf Haldenstein
and the Kansas City Star story, issued a press release
announcing their interest in the case. To Wolf Haldenstein's
knowledge, none of these other firms have commenced a lawsuit.
Because attorneys at Wolf Haldenstein have conducted a thorough
investigation, they are in the best position to answer questions
about the claims alleged in the Complaint and can be contacted
to discuss this case through the telephone number or e-mail
address indicated below.

The Complaint alleges that defendants breached their fiduciary
duties to the Plan by failing to advise Plan participants that
investments in the Aquila Stock Option had evolved into a high
risk game, and that the entire energy trading sector that Aquila
had wrapped itself into was fraught with risk and manipulative
practices. The Complaint also alleges that defendants breached
their fiduciary duties to the Plan by failing to limit Plan
investment in the Aquila Stock Option or to consider entirely
eliminating the Aquila Stock Option from the Plan. The Complaint
alleges that Plan participants suffered substantial losses as a
result of defendants fiduciary breaches, as Aquila stock lost
over 94% of its value during the Class Period.

For more details, contact Fred Taylor Isquith, Esq., Michael
Jaffe, Esq. or Christopher S. Hinton, Esq. of Wolf Haldenstein
Adler Freeman & Herz LLP by Mail: 270 Madison Avenue, New York,
NY 10016 by Phone: (800) 575-0735 or (212) 545-4600 by E-mail:
classmember@whafh.com or visit their Web site:
http://www.whafh.com/cases/aquila2.htm


INFINEON TECHNOLOGIES: Schatz & Nobel Lodges CA Securities Suit
---------------------------------------------------------------
The law firm of Schatz & Nobel, P.C. initiated a lawsuit seeking
class action status in the United States District Court for the
Northern District of California on behalf of all persons who
purchased the securities of Infineon Technologies AG (NYSE: IFX)
("Infineon") between March 13, 2000 and July 19, 2004 (the
"Class Period"), including anyone who purchased in the March 13,
2000 or July 12, 2001 offerings of Infineon American Depository
Receipts ("ADRs").

The complaint alleges that during the Class Period, Infineon
violated United States securities laws by issuing false or
misleading public statements. The Complaint alleges that
Infineon was engaged in a conspiracy to fix the prices of
Dynamic Random Access Memory ("DRAM") devices sold to original
equipment manufacturers ("OEMs") of personal computers and
servers. On September 15, 2004, the Associated Press issued an
article which stated: "German computer chipmaker Infineon
Technologies AG has agreed to plead guilty to price fixing and
will pay a $160 million fine. . . . In a plea agreement filed in
U.S. District Court in San Francisco, Infineon acknowledged
conspiring with other companies to fix prices of widely used
computer memory products between July 1999 and June 2002."

For more details, contact Schatz & Nobel by Phone:
(800) 797-5499 by E-mail: sn06106@aol.com or visit their Web
site: http://www.snlaw.net


MERCK & CO.: Charles J. Piven Lodges Securities Fraud Suit in NJ
----------------------------------------------------------------
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 Merck & Co.,
Inc. (NYSE:MRK) between October 30, 2003 and September 29, 2004,
inclusive (the "Class Period").

The case is pending in the United States District Court for the
District of New Jersey. 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, MD 21202 by Phone: 410/986-0036
or by E-mail: hoffman@pivenlaw.com


MERCK & CO.: Jeffrey L. Suher Lodges Securities Fraud Suit in PA
----------------------------------------------------------------
Jeffrey L. Suher, Attorney at Law initiated a securities class
action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of Merck & Co.,
Inc. (NYSE:MRK) between October 23, 2003 and September 30, 2004,
inclusive (the "class period"). The case is pending in the
United States District Court for the Western District of
Pennsylvania.

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 Jeffrey L. Suher, Esq. by Phone: 4328
Old William Penn Highway, Suite 2J, Monroeville, PA 15146 by
Phone: (412) 374-9005 or by E-mail: jsuherlaw@adelphia.net


MERCK & CO.: Wolf Haldenstein Lodges Securities Fraud Suit in NJ
----------------------------------------------------------------
The law firm of Wolf Haldenstein Adler Freeman & Herz LLP
commenced a class action lawsuit in the United States District
Court for the District of New Jersey on behalf of all persons or
entities who purchased or otherwise acquired Merck & Co., Inc.
securities, including common stock ("Merck" or the "Company")
(NYSE: MRK), between October 30, 2003 and September 29, 2004,
inclusive (the "Class Period") and who suffered damages.

The complaint alleges that Merck failed to disclose material
information during the Class Period concerning the safety
profile of its arthritis drug Vioxx, and that a growing body of
evidence demonstrated that patients who used the drug for more
than 18 months were exposed to an increased risk of heart
attack.

Specifically, on September 30, 2004, the Company announced that
it was immediately withdrawing Vioxx from world markets after a
data safety monitoring board, overseeing a long-term study of
the drug, recommended that the study be halted because of an
increased risk of serious cardiovascular events among members of
the study group. The Company's sudden decision to withdraw Vioxx
was in stark contrast to its prior public announcements during
the Class Period touting the safety of Vioxx and other public
disclosures by the Company and its representatives that
specifically refuted criticism of the drug lodged by respected
clinicians.

Indeed, the Company's shocking withdrawal of Vioxx on September
30, 2004, came only one month after the Company issued a
strongly worded press release refuting reputable clinicians'
criticisms of Vioxx and its safety profile and on the heels of
the Company obtaining approval to market the drug for the
treatment of juvenile arthritis and migraines.

In addition to frightening millions of people who were misled
and used Vioxx despite these serious risks, the announcement
caused the Company's common stock to plummet during September
30, 2004 trading by approximately 25%, or $12 per share. The
resulting market capitalization loss was a staggering $26
billion.

For more details, contact Gregory M. Nespole, Esq. of Wolf
Haldenstein Adler Freeman & Herz LLP at 270 Madison Avenue, New
York, NY 10016 by Phone: 212-545-4600 or 800-575-0735 by E-mail:
classmember@whafh.com or nespole@whafh.com OR visit their Web
site: http://www.whafh.com


STONEPATH GROUP: Berman DeValerio Lodges Securities Suit in PA
--------------------------------------------------------------
The law firm of Berman DeValerio Pease Tabacco Burt & Pucillo
initiated a class action lawsuit in the U.S. District Court for
the Eastern District of Pennsylvania against Stonepath Group,
Inc. ("Stonepath" or the "Company") (AMEX:STG) claiming the
Company misled the investing public about its financial results.

The lawsuit seeks damages for violations of federal securities
laws on behalf of all investors who bought Stonepath common
stock from May 7, 2003 through and including September 20, 2004
(the "Class Period").

The lawsuit claims that the defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder, including U.S.
Securities and Exchange Commission ("SEC") Rule 10b-5.

The complaint names as defendants: Stonepath; Dennis L. Pelino,
who was at all relevant times the Company's chairman and chief
executive officer; Bohn H. Crain, who was at all relevant times
Stonepath's chief financial officer and treasurer; and Thomas L.
Scully, who at all relevant times served as vice president,
controller and principal accounting officer.

The complaint alleges that, throughout the Class Period,
Stonepath artificially inflated its stock price by issuing false
and misleading statements about the company's financial
performance.

On September 20, 2004, the Stonepath stunned the market when it
reported that it intended to restate its fiscal year 2003 and
first and second quarter 2004 financial statements. The Company
announced that, after an internal review of the process by which
Stonepath's Domestic Services unit maintained its accrual for
the costs of purchases transportation, it determined that the
Company had understated its accrued purchased transportation
liability and related costs of purchased transportation.

The Company concluded that this process did not "accurately
account for the difference between the estimates and actual
freight costs incurred. This allowed for the accumulation of
previously unidentified costs to purchase transportation and an
under-reported liability for the accrued cost."

As a result of the news, the price of Stonepath stock fell to
$0.86 per share on September 21, 2004, down 46% from its close
at $1.59 on September 20, 2004.

The lawsuit claims that the defendants were motivated to
artificially inflate Stonepath's stock price to complete several
private placements of the Company's common stock and to complete
several strategic acquisitions during the Class Period.

For more details, contact Jeffrey C. Block, Esq. or Julie C.
Easter, Esq. by Mail: One Liberty Square, Boston, MA 02109 by
Phone: (800) 516-9926 by E-mail: law@bermanesq.com or visit
their Web site: http://www.bermanesq.com/pdf/Stonepath-Cplt.pdf


TECO ENERGY: Squitieri & Fearon Lodges Securities Lawsuit in FL
---------------------------------------------------------------
The law firm of Squitieri & Fearon, LLP initiated a class action
in the United States District Court for the Middle District of
Florida on behalf of purchasers of TECO Energy, Inc. ("TECO")
(NYSE:TE) securities during the period between October 30, 2001
and February 4, 2003 (the "Class Period").

The lawsuit charges TECO and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. TECO is a holding company for regulated utilities and
other unregulated businesses. During the Class Period, TECO
concealed problems with independent power plant construction
ventures for which it would ultimately be fully responsible,
including the Company's full exposure to the demise of Enron
Corporation and the vulnerability of the company's large cash
dividend, causing TECO securities to trade at artificially
inflated levels. The individual defendants sold over $4.2
million of their own stock and raised over $792 million selling
equity securities. In late 2002 and early 2003, several large
projects and their liabilities were "put" to TECO, moving
hundreds of millions of dollars of off-balance sheet debt into
TECO's balance sheet. TECO took over a billion dollars in
impairment charges as a result, causing its stock to fall from a
Class Period high of over $28 per share, to below $13 per share
on February 4, 2003.

For more details, contact Lee Squitieri of Squitieri & Fearon,
LLP by Phone: (212) 421-6492 or by E-mail: lee@sfclasslaw.com


WET SEAL: Murray Frank Lodges Securities Fraud Suit in C.D. CA
--------------------------------------------------------------
The law firm of Murray, Frank & Sailer LLP initiated a complaint
in the Central District of California on behalf of all
securities purchasers of The Wet Seal, Inc. (NASDAQ:WTSLA) ("Wet
Seal" or the "Company") from January 7, 2004 through August 19,
2004 inclusive (the "Class Period").

The complaint charges Wet Seal, Peter D. Whitford, Joseph E.
Deckop, and Irving Teitelbaum with violations of Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. More specifically, the Complaint alleges
that the Company failed to disclose and misrepresented the
following material adverse facts known to defendants or
recklessly disregarded by them:

     (1) that the Company's strategic initiatives plan was not
         strengthening the Company's corporate standing. In
         fact, the Company's strategic initiatives plan was a
         complete and total disaster that was leading the
         Company into financial ruin;

     (2) that demand for the Company's products was based on
         deep-discounting and that without deep-discounting its
         products, demand for such was at an all time low; and

     (3) that as a result of the above, the Company's
         projections, outlooks, and positive statements, were
         lacking in any reasonable basis when made.

On August 19, 2004, Wet Seal, after the market closed, shocked
the market by reporting that net loss from continuing operations
of $3.20 per share for the second quarter ended July 31, 2004.
Following this post-market announcement, shares of Wet Seal shed
$1.25 per share, or 59.52 percent, to close at $0.85 per share
on unusually high trading volume on August 20, 2004.

For more details, contact Murray, Frank & Sailer LLP by Mail:
Eric J. Belfi or Aaron D. Patton by Phone: (800) 497-8076 or
(212) 682-1818 by Fax: (212) 682-1892 or by E-mail:
info@murrayfrank.com


WET SEAL: Weiss & Yourman Files Securities Fraud Suit in N.D. CA
----------------------------------------------------------------
The law firm of Weiss & Yourman initiated a class action lawsuit
in the United States District Court for the Central District of
California, entitled Sadowsky v. The Wet Seal, Inc., on behalf
of persons who acquired the securities of The Wet Seal, Inc.,
(Nasdaq: WTSLA) ("Wet Seal" or "Company") between January 9,
2003 and August 19, 2004 inclusive (the "Class Period").

Wet Seal is a retailer with over 600 specialty stores selling
women's apparel and accessories. The Complaint alleges that
during the Class Period defendants released, or caused to be
released, false and misleading statements to artificially
inflate the value of Wet Seal stock and thereby violated
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b-5 promulgated thereunder. The Complaint alleges
that the Company failed to disclose and misrepresented material
adverse facts, which were known to defendants or recklessly
disregarded by them. Specifically, that the Company's strategic
initiatives plan was not strengthening the Company's corporate
standing and lead to the company's financial demise; that supply
and demand for the Company's products was based on deep-
discounting, without which the Company could not survive.
Consequently, the overly-stated projections and positive
statements made by the Company were without merit at the time
they were made.

For more details, contact Angela S. Rupert, Esq. of Weiss &
Yourman -- Los Angeles by Phone: (800) 437-7918 by E-mail:
info@wyca.com or visit their Web site: http://www.wyca.com


ZIX CORPORATION: Murray Frank Lodges Securities Fraud Suit in TX
----------------------------------------------------------------
The law firm of Murray, Frank & Sailer LLP initiated a class
action lawsuitin in the United States District Court for the
Northern District of Texas (Case No. 3:04-cv-2018-N) on behalf
of all securities purchasers of the Zix Corporation
(Nasdaq:ZIXI)("Zix" or the "Company") from October 30, 2003
through May 4, 2004 inclusive (the "Class Period").

The complaint charges Zix, John A. Ryan, Steve M. York, Ronald
A. Woessner, Daniel S. Nutkis, Russell J. Morgan, Wael Mohamed,
and Dennis F. Heathcote with violations of Sections 10(b)-5 and
20(a) of the Securities Exchange Act of 1934, and Rule 10(b)-5
promulgated thereunder. 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 deployment of e-prescription
         services was languishing;

     (2) that the Company seriously underestimated the hurdles
         of deploying e-prescription services in medical offices
         that lack up-to-date IT infrastructure;

     (3) as a result of these factors, the Company's deployment
         rate of 1,000 physicians a month was unattainable; and

     (4) as a consequence of the foregoing, the Company's
         projections lacked in any reasonable basis.

On May 4, 2004, Zix announced financial results for the first
quarter ended March 31, 2004. In the press release, the
Company's numbers were well below expectations. This news
shocked the market. Shares of Zix fell $2.12 per share or 15.58
percent on May 5, 2004, to close at $11.49 per share. On the
following day, shares of Zix fell an additional $2.60 per share
or 22.63 percent to close at $8.89 per share.

For more details, contact Murray, Frank & Sailer LLP by Mail:
Eric J. Belfi or Aaron D. Patton by Phone: (800) 497-8076 or
(212) 682-1818 by Fax: (212) 682-1892 or by E-mail:
info@murrayfrank.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.

                            *********


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Class Action Reporter is a daily newsletter, co-published by
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USA.   Glenn Ruel Se¤orin, Aurora Fatima Antonio and Lyndsey
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Copyright 2004.  All rights reserved.  ISSN 1525-2272.

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