/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/041201.mbx C L A S S A C T I O N R E P O R T E R Wednesday, December 1, 2004, Vol. 6, No. 238 Headlines ARMOR HOLDINGS: Resolves Zylon-Related Litigation in FL Counties BLOOMFIELD BAKERS: Recalls Cookies Due To Undeclared Walnuts CANADA: Halifax Woman Suing Over Husband's Long-term Care Costs CHAPARRAL NETWORK: Shareholders Lodge Securities Suit in C.D. CA CHOICEPOINT INC.: Asks Court For Summary Judgment in DPPA Suit CHORDIANT SOFTWARE: Executes Settlement of NY Securities Lawsuit COVAD COMMUNICATIONS: Finalizes Distribution of Suit Settlement COVAD COMMUNICATIONS: Faces Consolidated Securities Suit in DE FARMERS INSURANCE: Deadline Nears For Claims To $9.5M OR Award MICROTUNE INC.: Reaches $5.625M Securities Settlement in E.D. TX MISSISSIPPI: Children's Rights Eyes Foster Care Suit Settlement NEW CENTURY: Asks LA Court To Reject Wage Lawsuits Certification NEW CENTURY: IL Court Refuses To Reconsider TILA Suit Dismissal NEW CENTURY: IL Court Dismisses TILA Violations Consumer Lawsuit NEW CENTURY: Plaintiffs Seek Extension For Suit Dismissal Appeal NEW CENTURY: Asks NJ Court To Dismiss Lawsuit For Consumer Fraud NEW CENTURY: Plaintiffs Dismiss IL Interest Act Violations Suit NEW CENTURY: Faces MO Lawsuit Over State Law, RESPA Violations NEW YORK: Steuben County Opts To Join Pharmaceutical Lawsuit PMA CAPITAL: Plaintiffs File Consolidated Stock Suit in E.D. PA REALNETWORKS INC.: WA Court Grants Stay of Consumer Fraud Suit SOUTH AFRICA: NY Court Dismisses Apartheid Cases V. U.S. Firms UNITED STATES: ATLA, Law Firms Outraged By Vioxx Web Site UNITED STATES: Charfoos and Christensen Lodges MEPA Suit in MI UNUMPROVIDENT: Quadrino & Schwartz Opens Site For Policyholders VIGNETTE CORPORATION: Approves MOU To Settle NY Securities Suit WAL-MART STORES: Files Brief in CA Court Opposing Class Status WAL-MART STORES: Lawyers Say FL Workers' Suit Will Be Narrowed New Securities Fraud Cases DOBSON COMMUNICATIONS: Marc S. Henzel Lodges Stock Suit in OK FANNIE MAE: Marc S. Henzel Lodges Securities Fraud Suit in DC SIRVA INC.: Lasky & Rifkind Lodges Securities Fraud Suit in IL SIRVA INC.: Marc S. Henzel Lodges Securities Fraud Suit in IL STAR GAS: Pomerantz Haudek Sets Lead Plaintiff Deadline ********* ARMOR HOLDINGS: Resolves Zylon-Related Litigation in FL Counties ---------------------------------------------------------------- Armor Holdings, Inc. (NYSE: AH), a leading manufacturer and distributor of security products and vehicle armor systems serving law-enforcement, military, homeland security and commercial markets, recently revealed that the Duval County Circuit Court (Florida) entered a Supplemental Final Order and Judgment concluding the settlement of the class action lawsuit brought by the Southern States Police Benevolent Associate ("SSPBA"). As previously reported in the November 11, 2004 issue of the Class Action Reporter a final order and judgment approving the recently disclosed nationwide settlement against Armor Holdings, Inc. and various of its subsidiaries and affiliated entities, on behalf of purchasers of American Body Armor(TM) Safariland(R) and Protech(TM) ballistic vests containing Zylon(R) was issued by the Circuit Court of Duval County, Jacksonville, according to the Law Firm of Carr, Tabb, Pope & Freeman, LLP. As previously disclosed, the settlement, in summary, provides: All current owners of American Body Armor(TM) Xtreme ZX level II and level IIIA vests will receive, at no cost, a new ballistic vest of their choice manufactured by the Defendants or any of their subsidiaries or affiliated entities, including American Body Armor(TM), Safariland(R) and Protech(TM). Class members will also receive: (1) either one or two new carriers (depending on the new model they choose); and (2) a fully-transferable $100 voucher good for five years toward the future purchase of any new concealable body armor manufactured by American Body Armor(TM), Safariland(R) or Protech(TM). Aside from the aforementioned terms, class members may also be entitled to a cash refund. Furthermore, the Defendants must conduct substantial testing of their used body armor and make available to class members their testing data, protocols and other information. The estimated value of the nationwide settlement exceeds $20 million. In addition, on November 16, 2004, the Lee County Circuit Court (Florida) signed and entered a Final Order dismissing with prejudice the class action lawsuit commenced by the National Associate of Police Organizations, Inc. ("NAPO"). The result of these legal developments brings a final conclusion to both of the Zylon-related class action lawsuits that had been brought against the Company. For more details, contact W. Pitts Carr by Mail: 10 North Parkway Square, 4200 Northside Parkway, N.W., Atlanta, GA 30327 by Phone: 1-888-755-1649 or visit the following Web sites: http://www.ctpflaw.comor http://www.americanbodyarmor.com/zx. BLOOMFIELD BAKERS: Recalls Cookies Due To Undeclared Walnuts ------------------------------------------------------------ Bloomfield Bakers of Los Alamitos, California is recalling approximately 25,476 - 6.5 oz packages of Organica Foods Double Chocolate Coffee Toffee Cookies because they contain undeclared walnuts. People who have an allergy or severe sensitivity to walnuts run the risk of a serious or life-threatening allergic reaction if they consume this product. No illnesses have been reported to date in connection with this problem. The recalled Organica Foods brand Double Chocolate Coffee Toffee Cookies were distributed nationwide in retail stores. These cookies were distributed by S&P Foods (AKA Summerland Foods), 10061 Riverside Drive, Suite 807, Toluca Lake, CA 91602; Phone (323) 882-6670. The product is packed in a white printed gable-top 6.5 oz carton with green text and a picture of the cookie, including walnuts. With the following lots printed on a sticker affixed to the bottom of the carton: 20705, 31905, 32005, 42905, 60205. The recall was initiated after it was discovered that the cookies containing walnuts had been packed in cartons that did not include walnuts in the ingredient line. Subsequent investigation indicates that the walnuts were inadvertently left off of the ingredient line during a packaging artwork change. Bloomfield Bakers was supplied the packaging by the own label distributor, S & P Foods. Bloomfield Bakers no longer manufactures this product. Consumers who have purchased 6.5 oz packages of Organica Double Chocolate Coffee Toffee Cookies are urged to return them to the place of purchase for a full refund. Consumers with questions may contact Summerland Foods at (323) 882-6670 between the hours or 9 AM and 5 PM Pacific Time. CANADA: Halifax Woman Suing Over Husband's Long-term Care Costs --------------------------------------------------------------- A Halifax resident Joan Morrison is suing the provincial government for forcing her to pay the medical costs associated with her husband's stay in a long-term care facility, the Medical Post reports. According to the lawyer representing Mrs. Morrison, he is hoping to turn the case into a class action lawsuit. Given the nature of the suit, however, he may have difficulty making a case, according to an expert in health law. Mr. Morrison's 76-year-old husband, Elmer, who has Parkinson's disease, has been in a long-term care facility since 2002. In the two years since being admitted, nursing home costs-including health-care costs-have amounted to more than $134,000 and have raised sharply recently, Mrs. Morrison told the Chronicle Herald newspaper. That is money she shouldn't have to pay, according to her Halifax attorney Ray Wagner, who is arguing that the province's long-term care policies are discriminatory on the basis of age, health and marital status. In addition, Mr. Wagner is claiming that they violate three pieces of legislation: the Health Services Insurance Act, the Homes for Special Care Act and the Canada Health Act. In an interview with the Medical Post, Elaine Gibson, associate director of the Health Law Institute at Dalhousie University, said that a possible legal argument could be made that forcing individuals to pay for nursing home services-similar to services provided in a hospital and even a doctor's office-violates the universality principle in the Canada Health Act. Though noting that such an argument would make sense, Ms. Gibson was quick to reply that the recompense is then not a judgment in court. It's that the federal government would hold back payment. She also adds, "the Canada Health Act doesn't guarantee a right to health care, all it says is funding can be withdrawn." Ironically, the lawsuit was filed just as the provincial government announced it would be fast-tracking changes to the long-term care system. According to deputy minister of health Cheryl Doiron, effective Jan. 1, 2005, the provincial government will cover all health-care costs for residents in nursing homes. She also states, "Residents who can afford it will pay their non-medical costs." Financial evaluation-one of the issues raised in Mrs. Morrison's lawsuit-will also be simplified. "Assets will not be assessed. Period," said Ms. Doiron. "The financial review will be based only on income." CHAPARRAL NETWORK: Shareholders Lodge Securities Suit in C.D. CA ---------------------------------------------------------------- Chaparral Network Storage, Inc. (now acquired by Dot Hill Systems Corporation) and certain of its former officers and directors face a shareholder class action filed in the United States District Court for the Central District of California. The lawsuit, among other things, alleges violations of federal securities laws and purports to seek damages on behalf of a class of shareholders who purchased Chaparral securities during a defined period prior to Dot Hill's acquisition of Chaparral. CHOICEPOINT INC.: Asks Court For Summary Judgment in DPPA Suit -------------------------------------------------------------- ChoicePoint, Inc. asked the United States District Court for the Southern District of Florida to grant summary judgment in their favor in a class action filed against it, styled Fresco, et al. v. Automotive Directions Inc., et al. The suit alleges the Company has obtained, disclosed and used information originating from the Florida Department of Highway Safety and Motor Vehicles ("Florida DHSMV"), in violation of the federal Driver's Privacy Protection Act (DPPA). The plaintiffs seek to represent classes of individuals whose personal information from Florida DHSMV records has been obtained, disclosed and used for marketing purposes or other allegedly impermissible uses by ChoicePoint without the express written consent of the individual. A number of the Company's competitors have also been sued in the same or similar litigation in Florida. The Company also has joined in a motion for judgment on the pleadings. This complaint seeks certification as a class action, compensatory damages, attorney's fees and costs, and injunctive and other relief. CHORDIANT SOFTWARE: Executes Settlement of NY Securities Lawsuit ---------------------------------------------------------------- Chordiant Software, Inc. executed a formal settlement agreement for the consolidated securities class action filed against it and certain of its officers and directors in the United States District Court for the Southern District of New York, now consolidated under the caption, "In re Chordiant Software, Inc. Initial Public Offering Securities Litigation, Case No. 01-CV- 6222." In the amended complaint, the plaintiffs allege that Chordiant, certain of the Company's officers and directors and the underwriters of its initial public offering (IPO) violated Section 11 of the Securities Act of 1933 based on allegations that Chordiant's registration statement and prospectus failed to disclose material facts regarding the compensation to be received by, and the stock allocation practices of, the IPO underwriters. The complaint also contains a claim for violation of Section 10(b) of the Securities Exchange Act of 1934 based on allegations that this omission constituted a deceit on investors. The plaintiffs seek unspecified monetary damages and other relief. Similar complaints were filed in the same court against hundreds of other public companies ("Issuers") that conducted IPOs of their common stock in the late 1990s (collectively, the "IPO Lawsuits"). In October 2002, the parties agreed to toll the statute of limitations with respect to Chordiant's officers and directors until September 30, 2003, and on the basis of this agreement, the Company's officers and directors were dismissed from the IPO Lawsuits without prejudice. In February 2003, the Court issued a decision denying the motion to dismiss the Section 11 claims against Chordiant and almost all of the other Issuers and denying the motion to dismiss the Section 10(b) claims against Chordiant and many of the Issuers. In June 2003, Issuers and plaintiffs reached a tentative settlement agreement that would, among other things, result in the dismissal with prejudice of all claims against the Issuers and their officers and directors in the IPO Lawsuits, and the assignment to plaintiffs of certain potential claims that the Issuers may have against the underwriters. The tentative settlement also provides that, in the event that plaintiffs ultimately recover less than a guaranteed sum of $1 billion from the IPO underwriters, plaintiffs would be entitled to payment by each participating Issuer's insurer of a pro rata share of any shortfall in the plaintiffs' guaranteed recovery. In September 2003, in connection with the possible settlement, those officers and directors who had entered tolling agreements with plaintiffs agreed to extend those agreements so that they would not expire prior to any settlement being finalized. In June 2004, the Company executed a formal settlement agreement with the plaintiffs consistent with the terms described above. The settlement is subject to a number of conditions, including action by the Court certifying a class action for settlement purposes and formally approving the settlement. The underwriters have opposed both certification of the class and judicial approval of the settlement. COVAD COMMUNICATIONS: Finalizes Distribution of Suit Settlement --------------------------------------------------------------- The distribution of the settlement of the consolidated securities class action filed against Covad Communications Group, Inc. and certain of its present and former officers and directors has been finalized. Purchasers of the Company's common stock and purchasers of the convertible notes it issued in September 2000 filed complaints in the United States District Court for the Northern District of California, or District Court, in the fourth quarter of 2000. The complaints were consolidated and the lead plaintiff has filed its amended consolidated complaint. The amended consolidated complaint alleges violations of federal securities laws on behalf of persons who purchased or otherwise acquired the Company's securities, including common stock and notes, during the period from April 19, 2000 to May 24, 2001. The relief sought includes monetary damages and equitable relief. The Company and the officer and director defendants entered into a Memorandum of Understanding, or MOU, with counsel for the lead plaintiffs in this litigation that tentatively resolves the litigation, providing for the distribution of $16,500 in cash to be funded by the Company's insurance carriers and 6,495,844 shares of its common stock. The plaintiffs voted in favor of the Plan. The settlement provided for in the MOU was subject to the approval of the District Court and, on December 18, 2002, the District Court issued its final judgment and dismissal order. One class member subsequently filed an appeal relating to the allocation of the settlement proceeds between the plaintiffs and their attorneys. On February 18, 2004, the Ninth Circuit affirmed the District Court's final judgment and on February 24, 2004 the Company was informed that the class member who had filed the appeal would not be pursuing the matter any further. The distribution of the 6,495,844 shares was completed in April of 2004. COVAD COMMUNICATIONS: Faces Consolidated Securities Suit in DE -------------------------------------------------------------- Covad Communications Group, Inc.'s current and former directors faces a consolidated amended class action and derivative action filed in the Court of Chancery of the State of Delaware in and for New Castle County by the Company's former general counsel and secretary, Druv Khanna. On August 3, 2004, Mr. Khanna amended his Complaint and two additional purported shareholders joined the lawsuit. In this action the plaintiffs seek recovery on behalf of the company from the individual defendants for their purported breach of fiduciary duty. The plaintiffs also seek to invalidate the Company's election of directors in 2002, 2003 and 2004 because they claim its proxy statements were misleading. FARMERS INSURANCE: Deadline Nears For Claims To $9.5M OR Award -------------------------------------------------------------- Eligible motorists and health care providers have until December 6th to claim a share in a $9.5 million jury verdict that was returned in a class action lawsuit in Multnomah County Circuit Court in Oregon on December 5, 2003 against Farmers Insurance, the Bend.com reported. According to court documents, which stipulate that all claims must be postmarked no later than December 6, 2004, those who are eligible for a share of the jury award, include any person who made a personal injury ("PIP") claim with Farmers Insurance Company of Oregon, Mid-Century Insurance Company or Truck Insurance Exchange whose claim payment was reduced between January 26, 1998 and July 31, 1999. Also eligible for a share of the award are the doctors and medical clinics that treated the injured individuals. Court documents also stipulate that qualified individuals and health care providers would be compensated for the benefits Farmers did not pay and in addition, individual drivers and passengers who are class members may share in additional damages with a share of these damages possibly amounting to $207 or more per person. Jurors in the case Strawn v. Farmers Insurance Co. found that Farmers acted in bad faith and had been systematically defrauding its policyholders by failing to reimburse its customers for the full amount of their reasonable medical expenses following an auto accident. Oregon motor vehicles insurance law requires insurance companies pay "all reasonable medical expenses." Between 1998 and mid-1999, Farmers used a statistical formula that reduced payments to healthcare providers for any amount over what Farmers asserted was reasonable. The jury awarded $1,500,000 in compensatory damages and prejudgment interest, and $8,000,000 in punitive damages. Rick Yugler of the Portland firm Landye Bennett Blumstein, who filed the class action on behalf of the 7,200 injured motorists and over 1,500 Oregon doctors, chiropractors, therapists and hospitals who were affected by Farmers action said, "The amounts the company was taking from individual consumers were so small that it was never enough for one person to pursue. Of course, all these small amounts added up to over a million dollars in profits for the insurance company." The original claimant was Mark Strawn, who was injured in a car wreck in 1997. His insurance company, Farmers, paid over $17,000 of his medical expenses, except for $427. When Mr. Yugler investigated on behalf of Mr. Strawn, he discovered Farmers' deliberate system of cutting reimbursements. The system was never disclosed in the insurance policy, Farmers though eventually changed its practice in 1999. For more details, contact Strawn Claims Administration by Mail: P.O. Box 3560, Portland OR 97208-3560 by Phone: 800-245-5097 or by E-mail: http://www.farmerspipclaims.com. MICROTUNE INC.: Reaches $5.625M Securities Settlement in E.D. TX ---------------------------------------------------------------- Microtune(R), Inc. (Nasdaq:TUNE), a silicon and subsystems company that designs and markets radio frequency (RF)-based solutions for the worldwide broadband communications and transportation electronics markets reached an agreement to settle the consolidated securities class action litigation, pending in the U.S. District Court for the Eastern District of Texas against Microtune and a number of Microtune's current and former officers and directors. Under the terms of the proposed settlement, the securities class action litigation will be dismissed in exchange for a payment of $5,625,000. Microtune's director and officer insurance carriers have agreed to pay the $5,625,000 settlement amount, subject to the Company's 15% co-pay obligation, under a separate settlement agreement with the carriers reached on November 22, 2004. Microtune established an accrual for its co-pay obligation during the third quarter of 2004. Microtune's insurance carriers also have agreed to reimburse certain of the Company's defense costs. Microtune believes that the net effect of its co-pay obligation and expense reimbursement from its insurance carriers will have an insignificant impact on the Company's cash reserves. As part of the settlement of the securities class action litigation, Microtune made no admission of wrongdoing. The settlement of the securities class action litigation is subject to a number of conditions, including notice to the class and final court approval following completion of a fairness hearing. At this time, there can be no assurance that these conditions will be met and that the settlement of the securities class action litigation will receive final court approval. Microtune's settlement agreement with its director and officer insurance carriers resolves certain obligations of these carriers with respect to the securities class action litigation, including the settlement payment and reimbursement for defense costs mentioned above, and the previously announced investigation of the Company by the Securities and Exchange Commission. Additionally, the agreement addresses certain of the parties' obligations relating to the previously announced consolidated derivative action lawsuit against Microtune and a number of Microtune's current and former officers and directors. The insurance carrier agreement is subject to a number of conditions, including the execution and final court approval of the securities class action litigation settlement and the dismissal of the securities class action with prejudice. MISSISSIPPI: Children's Rights Eyes Foster Care Suit Settlement --------------------------------------------------------------- Several days after a federal judge refused to dismiss a lawsuit against the state of Mississippi over the treatment and care of foster children in its custody, New York-based Children's Rights, the group that sued the state in March said that it's willing to discuss settling the case, the Clarion-Ledger reports. The state had tried to get the case dismissed on several grounds, including the doctrine that the federal judiciary is prohibited from interference in pending state judicial and administrative proceedings. However, U.S. District Judge Tom S. Lee refused to dismiss the lawsuit. According to Marcia Robinson Lowry, executive director of Children's Rights, Judge Lee's decision could allow a speedy resolution. Ms. Lowry further adds, "The legal rulings by Judge Lee create a strong framework on which we will prove the harm that the state is inflicting on the vulnerable abused and neglected children the state is legally obligated to protect." Earlier this year, the U.S. Department of Health and Human Services reported the state failed to meet standards on abuse of children in foster care and the length of time it took to reunite children with their parents or place them for adoption. The federal lawsuit was filed on behalf of 13 children alleged to have suffered physical and psychological harm while under the care and supervision of the Mississippi Department of Human Services Division of Family and Children Services. Class action status has been sought for the lawsuit, but Judge Lee has yet to decide on that issue. NEW CENTURY: Asks LA Court To Reject Wage Lawsuits Certification ---------------------------------------------------------------- New Century Mortgage Corporation asked the United States District Court for the Middle District of Louisiana to reject conditional certification for the lawsuits filed against it and: (1) New Century TRS Holdings, Inc. (2) Worth Funding Incorporated (now known as New Century Credit) (3) The Anyloan Company. In April 2003, two former, short-term employees, Kimberly A. England and Gregory M. Foshee filed the suit in the 19th Judicial District Court, Parish of East Baton Rouge, State of Louisiana. The suit was later removed to the U.S. District Court for the Middle District of Louisiana. The complaint alleges failure to pay overtime wages in violation of the federal Fair Labor Standards Act. The plaintiffs filed an additional action in Louisiana State Court (19th Judicial District Court, Parish of East Baton Rouge) on September 18, 2003, adding James Gray as a plaintiff and seeking unpaid wages under state law, with no class claims. This second action was removed on October 3, 2003 to the U.S. District Court for the Middle District of Louisiana, and was ordered consolidated with the first action. In April 2004, the U.S. District Court unilaterally de- consolidated the James Gray individual action. In September 2003, the plaintiffs also filed a motion to dismiss their claims in Louisiana to enable them to join in a subsequently filed case in Minnesota entitled Klas vs. New Century TRS, et al. The Company opposed the motion and the Court agreed with the Company's position and refused to dismiss the plaintiffs' case, as it was filed first. The Klas case has now been consolidated with this case and discovery is proceeding. The Company filed a motion to dismiss Worth Funding Incorporated (now known as New Century Credit) and The Anyloan Company as defendants. The Court granted the motion to dismiss in April 2004. On June 28, 2004, the Company filed a motion to reject conditional certification of a collective action. The Company awaits a ruling. NEW CENTURY: IL Court Refuses To Reconsider TILA Suit Dismissal --------------------------------------------------------------- The United States District Court for the Northern District of Illinois denied plaintiffs' motion for reconsideration of its dismissal of a class action filed against New Century Mortgage Corporation and: (1) Tamayo Financial Title, Inc., (2) Presidential Title, Inc., (3) Juan Tamayo Jr., (4) Jose Tamayo and (5) Luis Tamayo Canales Jose Ines and Maria S. Marquez filed the suit, alleging violations of the Truth in Lending Act (TILA) related to the fees charged for title insurance and recording fees. The Company filed its motion to dismiss in December 2003 and the motion was fully briefed in January 2004. On April 5, 2004, the Court granted the motion to dismiss and directed the court clerk to enter judgment in the Company's favor and terminate the case from the Court's docket. On April 13, 2004, the plaintiffs filed a motion for reconsideration and for leave to amend their complaint. The motion was fully briefed in June 2004. On July 20, 2004, the Court denied the plaintiffs' motion for reconsideration and the plaintiff's motion for leave to amend. Plaintiffs did not seek to appeal the order dismissing the Company. NEW CENTURY: IL Court Dismisses TILA Violations Consumer Lawsuit ---------------------------------------------------------------- The United States District Court for the Northern District of Illinois dismissed the class action filed against New Century Mortgage Corporation. Denise Wade filed the suit against the Company and: (1) Providential Bancorp, Ltd., (2) Jet Title Services, LLC, and (3) Ocwen Federal Bank, FSB. The complaint alleges violations of the Truth in Lending Act TILA related to the fees charged for title insurance and recording fees. The Company filed its motion to dismiss in November 2003 and the motion was fully briefed in January 2004. The plaintiff filed a motion to amend in April 2004 and it was fully briefed in June 2004. On September 20, 2004, the plaintiff filed a motion for class certification and the Court has set a briefing schedule. On September 29, 2004, the Company filed a motion to strike, or in the alternative, to stay the plaintiff's motion for class certification. By an Order dated September 29, 2004, the plaintiff's motion to amend the complaint was denied and the Company's motion to dismiss was granted. NEW CENTURY: Plaintiffs Seek Extension For Suit Dismissal Appeal ---------------------------------------------------------------- Plaintiffs asked the State Court in Suffolk County, New York to grant them an extension to file their appeal brief for the dismissal of the class action filed against New Century Mortgage Corporation. In December 2003, the Company was served with a class action complaint filed by Elaine Lum. The complaint alleged that certain payments the Company makes to mortgage brokers, sometimes referred to as yield spread premiums, interfered with the contractual relationship between Ms. Lum and her broker. The complaint also sought damages related thereto for fraud, wrongful inducement/breach of fiduciary duty, violation of deceptive acts and practices, unjust enrichment and commercial bribing. The complaint seeks class certification for similarly situated borrowers in the State of New York. The Company filed a motion to dismiss on January 30, 2004. The judge granted the Company's motion and dismissed all claims on March 23, 2004. On April 12, 2004, the plaintiff filed a notice of appeal, seeking review of the Court's s order granting the motion to dismiss. NEW CENTURY: Asks NJ Court To Dismiss Lawsuit For Consumer Fraud ---------------------------------------------------------------- New Century Mortgage Corporation asked the United States District Court for the District of New Jersey to dismiss the class action filed against it and New Century TRS Holdings, Inc. in June 2004. Joseph and Emma Warburton filed the suit, alleging violations of the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA) and the New Jersey Consumer Fraud Act, and unjust enrichment. The complaint also alleges certain other violations against defendants unrelated to New Century TRS and New Century Mortgage, including Foxtons, Inc., Foxtons North America, Foxtons Realtor and Foxtons Financial, Inc., which the Company refers to collectively as Foxtons, and Worldwide Financial Resources, Inc. The plaintiffs allege, among other things, that Foxtons, acting as their broker, charged fees and received a yield spread premium without disclosing the same to them until the time of closing. The class is defined as all persons in the state of New Jersey who have purchased, or sought to purchase, a home listed for sale by Foxtons and who have paid a pre-qualification application fee, or who have received and accepted an offer from Foxtons for a fixed interest rate mortgage loan that Foxtons failed to deliver as promised and who have suffered damages as a result. The complaint seeks to enjoin the wrongful conduct alleged, recovery of actual and statutory damages, and attorneys' fees and costs. The complaint does not specify the amount of damages sought. NEW CENTURY: Plaintiffs Dismiss IL Interest Act Violations Suit --------------------------------------------------------------- Plaintiffs entered a notice of dismissal for the class action filed against New Century Mortgage Corporation in the United States District Court for the Northern District of Illinois. In June 2004, Kristi Lyn Randall filed the suit, alleging that the Company violated Section 4.1a of the Illinois Interest Act by charging more than 3 points on loans with an interest rate of 8% per annum or higher. The complaint also alleges that the Company and defendant Nations Title Agency of Illinois, Inc. violated state law by improperly charging certain fees and taxes. The class is defined as all persons who are residents of Illinois who obtained loans from the Company (which loans are still outstanding or were paid off within two years prior to the filing of this action) at an interest rate of 8% per annum or higher and were charged more than 3 points on such loans. The complaint seeks recovery of statutory, compensatory, punitive and restitutionary damages, and attorneys' fees and costs. The complaint does not specify the amount of damages sought. The plaintiff was granted leave to file an amended complaint on July 21, 2004, which adds Robert and Alice Elibasich as plaintiffs. The Company filed its answer in August 2004. On August 4, 2004, the plaintiffs filed a motion for immediate class certification and the judge denied the request for immediate relief and set a briefing schedule for class certification. The motion for class certification has been stayed per the Court's order of September 16, 2004. The Company filed a notice of removal on October 21, 2004 and case has been removed to the U.S. District Court, Northern District of Illinois. NEW CENTURY: Faces MO Lawsuit Over State Law, RESPA Violations -------------------------------------------------------------- New Century Mortgage Corporation faces a class action filed in the Circuit Court in St. Louis County, Missouri, alleging violations of Missouri state law and the Real Estate Settlement Procedures Act (RESPA). In October 2004, Debbie Henderson, Florence Obani-Nwibari, Noble Obani-Nwibari, Emmer Hardy, James D. Hardy, Subbaiah Chalevendra, Rafael F. Herrara and Sandra G. Martinez filed a class action complaint, which also names as defendants: (1) First Horizon Home Loan Corporation, (2) Master Financial, Inc., (3) Mortgage Lenders Network USA, Inc., (4) Hillsboro Title Company, Inc. and (5) American Mortgage Corporation The complaint alleges the unauthorized practice of law in violation of Missouri state law and the RESPA for performing document preparation services in the state of Missouri for a fee by non-lawyers, and seeks to recover the fees charged for the document preparation, compensatory and punitive damages, attorneys' fees and costs. NEW YORK: Steuben County Opts To Join Pharmaceutical Lawsuit ------------------------------------------------------------ After a recent 20-minute executive legislative session, Steuben County Attorney Frederick Ahrens Jr. announced that they would join other counties in the state in a class action lawsuit against pharmaceutical companies that may reach national proportions to recover alleged Medicaid pharmaceutical overcharges, the Corning Leader reports. Though the lawsuit is still in its infancy stage, Mr. Ahrens told the Corning Leader that the county Legislature's Administration Committee is taking on the local groundwork in the next few months. This decision by the Steuben legislators aligns the county with neighboring counties, like Schuyler, Chemung and Tioga, which joined the lawsuit when their legislatures met earlier this month. According to published reports, the lawsuit charges a number of pharmaceutical and related companies set artificially high prescriptive drugs prices for Medicaid patients. Current Medicaid practices do not allow physicians to prescribe low-cost generic drugs for their low-income patients. The cost of the drugs is borne by the federal, state and local governments, and is among the fastest growing segments of Medicaid expenditures. Mr. Ahrens states that in Steuben County alone, pharmaceutical costs account for 19 percent of the total county Medicaid budget. Prices have doubled in the past four years, from $10.9 million paid out in 2000 to more than $22 million this year, he adds. Aside form calling for a judgment that the companies engaged in intentionally fraudulent conduct, the lawsuit is also calling for restitution and financial penalties and an injunction against overcharging in the future though there is no way to know what the financial implications of the lawsuit are at this point, according to Mr. Ahrens said. PMA CAPITAL: Plaintiffs File Consolidated Stock Suit in E.D. PA --------------------------------------------------------------- Plaintiffs filed an amended consolidated class action against PMA Capital Corporation and certain of its directors and key executive officers in the United States District Court for the Eastern District of Pennsylvania Several suits were filed on behalf of alleged purchasers of its Class A Common Stock, 4.25% Senior Convertible Debentures and 8.50% Monthly Income Senior Notes due 2018. On June 28, 2004, the District Court issued an order consolidating the cases under the caption In Re PMA Capital Corporation Securities Litigation (civil action no. 03-6121) and appointed Sheet Metal Workers Local 9 Pension Trust, Alaska Laborers Employers Retirement Fund and Communications Workers of America for Employees' Pension and Death Benefits as lead plaintiff. On September 20, 2004, the plaintiffs filed an amended and consolidated complaint on behalf of an alleged class of purchasers of the Company's securities between May 5, 1999 and February 11, 2004. The complaint alleges, among other things, that the defendants violated Section 10(b) of the Exchange Act, and Rule 10b-5 thereunder by making materially false and misleading public statements and material omissions during the class period regarding the Company's underwriting performance, loss reserves and related internal controls. The complaint alleges, among other things, that the defendants violated Sections 11, 12(a) (2) and 15 of the Securities Act by making materially false and misleading statements in registration statements and prospectuses about the Company's financial results, underwriting performance, loss reserves and related internal controls. The complaint seeks unspecified compensatory damages, the right to rescind the purchases of securities in the public offerings, interest, and plaintiffs' reasonable costs and expenses, including attorneys' fees and expert fees. REALNETWORKS INC.: WA Court Grants Stay of Consumer Fraud Suit -------------------------------------------------------------- Washington State Court granted RealNetworks, Inc.'s motion to stay the consumer fraud suit filed against it, alleging causes of action based on the Washington Consumer Protection Act and unjust enrichment. In March 2003, William Cirignani filed the suit, which alleges consumers who attempted to download or purchase certain of the Company's products and services were fraudulently and deceptively enrolled in, and prevented from canceling, the Company's subscription services. The plaintiff seeks compensatory damages, equitable relief in the form of an order prohibiting the alleged false and deceptive practices, treble damages and other relief. The trial Court has granted the Company's motion to stay the action pending arbitration on an individual, non-class basis and the Court of Appeals and the Washington Supreme Court have rejected the plaintiff's appeal. SOUTH AFRICA: NY Court Dismisses Apartheid Cases V. U.S. Firms -------------------------------------------------------------- A New York court recently dismissed legal cases against more than 30 companies that were accused of having illegally aided the apartheid-era South African Government, the BBC News reports. The dismissed class action lawsuits had targeted firms like computer giant IBM and banking giant Citigroup, which the plaintiffs, who suffered under apartheid, accused of supplying oil, money and technology to South Africa. These resources, the case argued, were used for "oppression and persecution". However, District Judge John Sprizzo, who presided over the case, found that there was no violation of the law in commercial links with South Africa. In his judgment, he wrote, "Although it is clear that the actions of the apartheid regime were repugnant, and that the decision of the defendants to do business with that regime may have been morally suspect... it is this court's job to apply the law and not some normative or moral ideal." The promoters of the lawsuit had hoped to follow the success of legal action on behalf of victims of the Nazi Holocaust, though those cases have been complicated, legal pressure has persuaded companies and governments involved in the Holocaust to arrange for compensation. However, in the case of apartheid, matters have been impeded by the lack of direct corporate involvement in South African human- rights abuses, according to human rights experts. UNITED STATES: ATLA, Law Firms Outraged By Vioxx Web Site --------------------------------------------------------- Kenneth Suggs, president-elect of the Association of Trial Lawyers of America (ATLA), is considering making a phone call to Sen. Orrin Hatch telling the Utah Republican to blame a Canadian who goes by the name of Leon Master and not America's trial lawyers for a Web site that crows "Get Your Million Dollars From Vioxx Lawsuit," The Recorder reports. The site links to several law firms, including Suggs' Baltimore- based firm Janet, Jenner & Suggs, who have apparently entered deals with Google to serve up links to their firms alongside Vioxx-related content. Sen. Hatch, the outgoing Senate Judiciary Committee Chair has been pushing for caps on damages against drug makers, had pointed to the site at a recent Senate Finance Committee hearing as evidence of "a feeding frenzy from trial lawyers" against Merck & Co., the maker of the pain drug that has been shown to cause heart problems. Mr. Suggs protests that he had never heard of the site until a friend called to tell him that the senator was reading from the text of the site, and that it linked to his firm. "My law firm was put on there totally without our knowledge, and we certainly didn't pay this person. The claims that are made on there could get me disbarred," Mr. Suggs said. The "million dollars" site provides no information about its creator except an e-mail address for potential advertisers. But according to research by ATLA, the "Get Your Million Dollars From Vioxx Lawsuit" site, www.vioxx.x.yi.org, looks to be the work of a mysterious 29-year-old Ontarian who identifies himself on a hacking bulletin board as Leon Master. In addition to the million-dollar lure, the site claims that some firms "even pay $200 per sign-up, regardless of the outcome of the class action lawsuit." It also encourages patients to buy the drug at pharmacies still selling Vioxx, which may then be sued. Lawyers agree that the site's promises of financial gain as a result of Merck's September 30 recall of Vioxx are clearly unethical. "That is terrible. No wonder lawyers get a bad name," said Heather Foster, a partner with Lieff Cabraser Heimann & Bernstein currently involved in several Vioxx suits. An incensed Todd Schneider says his San Francisco firm, Schneider & Wallace, was linked to the "million dollars" site without his knowledge. "We believe their Web site is immoral, illegal and unethical," he said. Mr. Schneider said he has contacted the yi.org provider and Google, which apparently served up the ads, seeking to have the link to his firm pulled. But his attempts have so far been unsuccessful. "No one has been any help whatsoever," he said. "Frankly, it's an outrage." The Vioxx recall has elicited both shame and enthusiasm from the plaintiff bar, which has unleashed a deluge of newspaper and TV ads and a multitude of Web sites soliciting clients who suffered cardiovascular problems while taking Vioxx. Meanwhile, plaintiff attorneys insist that a single example of egregiously unethical advertising shouldn't deflect blame for the Vioxx disaster away from Merck, which allegedly marketed the drug for three years after finding it was unsafe. "Wouldn't you know that someone would turn it around so it's all the trial lawyers' fault?" said San Francisco solo Mary Alexander, who's currently preparing about 50 separate Vioxx suits. UNITED STATES: Charfoos and Christensen Lodges MEPA Suit in MI -------------------------------------------------------------- The law firm of Charfoos and Christensen will be holding a press conference to provide details on a recently filed class action suit entitled, City of River Rouge, the Citizens of the City of River Rouge and the Citizens of the City of Ecorse vs. United States Steel for alleged violation of the State of Michigan Natural Resources and Environmental Protection Act. The press conference will be held on Tuesday, November 30 at 11:00 am at the West Jefferson Ave entrance of the United States Steel, Great Lakes Works Plant, One Quality Drive, Ecorse, MI 48229. The firm is set to reveal the filing of a class action air pollution case against United States Steel Corporation on behalf of the City of River Rouge, the residents of the City of River Rouge and the residents of the City of Ecorse. The Michigan Natural Resources and Environmental Protection Act is the states equivalent to the National Environmental Policy Act (NEPA), and is also known as the Michigan Environmental Protection Act (MEPA). MEPA, (Natural Resources and Environmental Protection Act, 1994 PA 451, Part 17 -- formerly, Act 127, Public Act 1970), which is a supplemental to all other Michigan environmental laws, applies to any activity which "...has, or is likely to pollute, impair or destroy the air, water or other natural resources or the public trust therein..." Any person, organization, government body, or other legal entity can file MEPA suits. For more details, contact Ronald D. Baker, Principal of the Marketing Communications Counsel, Inc. by Phone: 248-615-6480 or 248-420-3276 (CELL) by Fax: 248-615-6488 or by E-mail: rbaker@mktcom.net OR David Bower, City Attorney, City of River Rouge by Phone: 313-842-5604 OR Jason Thompson of Charfoos and Christensen, P.C. by Phone: 313-875-8080 or 800-247-5974 by Fax: 313-875-8522 or visit their Web site: http://www.c2law.com. UNUMPROVIDENT: Quadrino & Schwartz Opens Site For Policyholders --------------------------------------------------------------- The law firm of Quadrino & Schwartz recently launched: http://www.unumprovidentclassaction.net,a website dedicated to helping UnumProvident (NYSE: UNM) policyholders get their long- term disability insurance claims fully and fairly considered. On November 18, UnumProvident, the largest provider of disability insurance in the country announced that it would reconsider over 200,000 previously denied claims as a result of a multi-state investigation into the Company's practices. Starting in the mid-1990s, the Company came under fire for its alleged practice of systematically denying and terminating legitimate disability claims in order to boost profits. Quadrino & Schwartz urges UnumProvident policyholders to seek legal representation as their claims are re-evaluated to ensure a fair claims handling process. "It is important for policyholders and plan beneficiaries to continue to seek legal representation regarding any re- evaluation by UnumProvident," said Richard Quadrino, founding partner of Quadrino & Schwartz. "The process is a legal minefield loaded with traps which we believe still benefit the Company, not the claimant," he added. "We will not stop fighting for the rights of the disabled until UnumProvident treats all of its disabled policyholders fairly." Quadrino & Schwartz has represented hundreds of disabled people who have had their long-term disability claims unfairly denied. Quadrino & Schwartz was the first long-term disability insurance law firm in the United States to bring a class action lawsuit against UnumProvident, Unum, Paul Revere, First Unum, Provident Life, and other UnumProvident subsidiaries to stop and correct their dishonest disability claims practices. Two class action lawsuits have been filed, the first seeking recovery for people who obtained their disability coverage through their employers, and the second seeking relief for those who purchased their own disability policies. Policyholders who had a disability claim denied or terminated at any time after January 1, 1997 by UnumProvident, Paul Revere Life Insurance Company, First Unum Life Insurance Company, Provident Life and Accident Insurance Company, Provident Life and Casualty Insurance Company, or Unum Life Insurance Company of America may visit http://www.unumprovidentclassaction.netor http://www.disabilityinsurancelawyers.comto receive a free initial case evaluation. For more details, contact Richard J. Quadrino or Evan S. Schwartz of Quadrino & Schwartz by Phone: (516) 745-1122 by E- mail: rjq@quadrinoschwartz.com or ess@quadrinoschwartz.com or visit their Web site: http://www.disabilityinsurancelawyers.com. VIGNETTE CORPORATION: Approves MOU To Settle NY Securities Suit --------------------------------------------------------------- Vignette Corporation approved a memorandum of understanding (MOU) to settle the securities class action filed against it and certain of its current and former officers and directors in the United States District Court for the Southern District of New York. Several suits were initially filed, seeking unspecified damages on behalf of a purported class that purchased Vignette common stock between February 18, 1999 and December 6, 2000. Also named as defendants were four underwriters involved in the Company's initial public offering of Vignette stock in February 1999 and the Company's secondary public offering of Vignette stock in December 1999 - Morgan Stanley Dean Witter, Inc., Hambrecht & Quist, LLC, Dain Rauscher Wessels and U.S. Bancorp Piper Jaffray, Inc. A Consolidated Amended Complaint, which is now the operative complaint, was filed on April 19, 2002. The complaint alleges violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, based on, among other things, claims that the four underwriters awarded material portions of the shares in the Company's initial and secondary public offerings to certain customers in exchange for excessive commissions. The complaint also asserts that the underwriters engaged in "tie-in arrangements" whereby certain customers were allocated shares of Company stock sold in its initial and secondary public offerings in exchange for an agreement to purchase additional shares in the aftermarket at pre-determined prices. With respect to the Company, the complaint alleges that the Company and its officers and directors failed to disclose the existence of these purported excessive commissions and tie-in arrangements in the prospectus and registration statement for the Company's initial public offering and the prospectus and registration statement for the Company's secondary public offering. The action is being coordinated with approximately 300 other nearly identical actions filed against other companies. On July 15, 2002, the Company moved to dismiss all claims against it. On October 9, 2002, the Court dismissed the Individual Defendants from the case without prejudice based upon Stipulations of Dismissal filed by the plaintiffs and the Individual Defendants. This dismissal disposed of the Section 15 and 20(a) control person claims without prejudice, since these claims were asserted only against the Individual Defendants. On February 19, 2003, the Court denied the motion to dismiss the complaint against the Company. The Company has approved a Memorandum of Understanding ("MOU") and related agreements that set forth the terms of a settlement between the Company, the plaintiff class and the vast majority of the other approximately 300 issuer defendants. Among other provisions, the settlement contemplated by the MOU provides for a release of the Company and the individual defendants for the conduct alleged in the action to be wrongful. The Company would agree to undertake certain responsibilities, including agreeing to assign away, not assert, or release certain potential claims the Company may have against its underwriters. It is anticipated that any potential financial obligation of the Company to plaintiffs pursuant to the terms of the MOU and related agreements will be covered by existing insurance. Therefore, the Company does not expect that the settlement will involve any payment by the Company. The MOU and related agreements are subject to a number of contingencies, including the negotiation of a settlement agreement and its approval by the Court. The Company cannot opine as to whether or when a settlement will occur or be finalized and is unable at this time to determine whether the outcome of the litigation will have a material impact on its results of operations or financial condition in any future period. WAL-MART STORES: Files Brief in CA Court Opposing Class Status -------------------------------------------------------------- Wal-Mart Stores Inc. (WMT) recently filed a brief with the U.S. Ninth Circuit Court of Appeals in California outlining why a sex-discrimination lawsuit against the retailer should lose its class action status, the Dow Jones Newswires reports. As previously reported in the September 29, 2004 edition of the Class Action Reporter, the appellate court agreed to review an earlier ruling by District Court Judge Martin Jenkins in San Francisco that six current and former Wal-Mart employees from California may represent all female Wal-Mart employees who worked at Wal-Mart's U.S. stores anytime since Dec. 26, 1998, which eventually lead to a class that covers about 1.6 million women. In their suit, the women, which include employees hired by Wal- Mart (WMT) since Dec. 26, 1998 claim they were consistently held back from promotions and paid less than male counterparts since at least 1987. The suit also calls for future hires to be included in the class action until the court issues an order ending the allegedly illegal practices. The world's largest retailer, which has vehemently maintained that it does not discriminate against women and that the class size is too large for the case to be manageable has consistently, argued that hiring, promoting and firing decisions were made at individual store levels and urged the judge to pull the cases apart for each store. They further argued that the suit doesn't take into account the thousands of women whose paychecks are bigger than their male counterparts. According to Joseph Sellers, one of the lawyers representing the plaintiffs in the case, there is no basis for the court to overturn the class-action status of the lawsuit based on arguments presented in the Wal-Mart's brief. Mr. Sellers even describes it as "a very ambitious brief that attempts to tackle more than just this case and adds, "Wal-Mart is attempting to overturn some fairly settled law in the Ninth Circuit Court." In the 83-page document, which contains a 60-page appellate brief, Wal-Mart again reiterated its previous argument that if the suit retained class-action status, women who weren't discriminated against could receive damages, including punitive damages, if disparate treatment was proven, while women who were discriminated against might not be compensated appropriately. The retailer also restated another earlier argument that it believes the class size -- which it says exceeds the popular of at least 12 of the 50 U.S. states -- is too large for the retailer to address individual plaintiff's claims. Ted Boutrous, lead defense counsel for Wal-Mart argues, "Even if plaintiffs make a statistical showing of disparity, an employer has a right to show that in individual cases there was no discrimination." In addition, Wal-Mart argues that the lower court ignored the retailer's "unrebutted" evidence that more than 90% of Wal-Mart stores showed no statistically significant disparities in pay between men and women. The judge for the lower court said the evidence related to the overall "merits" of the case, but Wal- Mart contends its evidence shows it didn't practice discrimination nationwide. "The judge was required to look at statistics from both sides, but he didn't do that," Mr. Boutrous said. "Many appeals courts have ruled that the district court has an obligation to look at the full record at this stage." Despite this latest legal maneuver by Wal-Mart, plaintiffs' lawyers were quick to point out that although the appeals court has agreed to review the lower-court's class action ruling, it doesn't necessarily mean it will overturn the decision. WAL-MART STORES: Lawyers Say FL Workers' Suit Will Be Narrowed -------------------------------------------------------------- Attorneys for Florida employees who had lodged a class action lawsuit against Wal-Mart Stores Inc., accusing it of failing to pay them for working during breaks and after hours recently revealed that they would proceed with a lawsuit after amending it to comply with an appellate court ruling, the AL.com, AL reports. As previously reported in the November 30, 2004 edition of the Class Action Reporter, the 1st District Court of Appeal in Tallahassee had refused to grant class-action status to the suit filed in Panama City on behalf of about 230,000 Wal-Mart workers because the class was too broad. In its ruling, the three-judge panel suggested that the class should be narrowed only those who have worked off the clock instead of all current and former hourly wage-earners who had been employed on or after July 13, 1997, which the plaintiffs' lawyers said they would follow. According to Russell Lloyd of Houston, who is handling similar suits in at least four other states, "We don't look at it as a loss," since tens of thousands of Florida workers would still be covered by the narrower suit and adds that narrowing the class should not be an obstacle. In reaction to the plaintiffs recent decision to follow the appellate court's recommendation, Wal-Mart spokesman Bill Wertz said, "We had a favorable ruling and now they're going to pursue an appeal, which they have every right to do. We feel confident about our case and we'll just have to wait and see what the ourt decides." New Securities Fraud Cases DOBSON COMMUNICATIONS: Marc S. Henzel Lodges Stock Suit in OK ------------------------------------------------------------- The law offices of Marc S. Henzel initiated a class action lawsuit in the United States District Court for the Western District of Oklahoma on behalf of purchasers of Dobson Communications, Inc. (NASDAQ: DCEL) common stock during the period between May 19, 2003 and August 9, 2004 (the "Class Period"). The complaint charges Dobson and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Dobson is a rural and suburban wireless communications services provider offering wireless calling, voice privacy and call security, tri-mode handsets and roaming. The Complaint alleges that, throughout the Class Period, defendants issued numerous positive statements describing the Company's financial prospects and the continued growth in the Company's roaming minutes, which are based on increased minutes of use. As alleged in the complaint, these statements were materially false and misleading because defendants knew, but failed to disclose that: (1) the Company's growth in roaming minutes was substantially declining, and the Company had experienced negative growth in October 2003; (2) AT&T, the Company's largest roaming customer, had notified defendants that it wanted to dispose of its equity interest in Dobson that it had held since Dobson's IPO, significantly decreasing AT&T's interest in purchasing roaming capacity from Dobson; (3) Bank of America intended to dispose of its substantial equity interest in Dobson as soon as AT&T disposed of its equity interest in Dobson; (4) the Company had been missing sales quotas and losing market share throughout the Class Period; and (5) the Company lacked the internal controls required to report meaningful financial results. On February 17, 2004, defendants announced that the Company had fallen materially short of hitting its earnings projections forecast in October 2003 and that it would drastically reduce its 2004 projections. Defendants now admitted that roaming revenue had declined from a 36% growth rate in April 2003 over April 2002 to a 22% decline by October 2003, causing the Company to miss EBITDA expectations by $9.5 million. On this news, the Company's shares plunged by 36% on extremely high trading volume. Then, on August 9, 2004, Dobson issued a press release announcing its second quarter financial results. The Company reported a net loss of $15.9 million per share, or $(0.12) per share. Dobson also dramatically cut its forecasts for subscriber additions. In response to this news, the price of Dobson stock plunged an additional 55% per share. For more detail, contact the law offices of 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. FANNIE MAE: Marc S. Henzel Lodges Securities Fraud Suit in DC ------------------------------------------------------------- The law offices of Marc S. Henzel initiated a class action lawsuit in the United States District Court for the District of Columbia on behalf of all persons who purchased or acquired the securities of the Federal National Mortgage Association (NYSE: FNM) between October 11, 2000 and September 22, 2004, inclusive (the "Class Period"). The Complaint charges Fannie Mae and certain executive officers of Fannie Mae with violations of the Securities Exchange Act of 1934. Among other things, the Complaint alleges that defendants' material omissions and the dissemination of materially false and misleading statements concerning Fannie Mae's financial results caused Fannie Mae's stock price to become artificially inflated, inflicting damages on investors. Fannie Mae is a Congressionally-chartered corporation that provides financing and conducts similar activities related to home mortgages and expanding home ownership in the United States. It is the largest source of home mortgage financing in the U.S. The Complaint alleges that the defendants failed to disclose or misrepresented the following adverse facts that were known to defendants or were recklessly disregarded by them: (1) that Fannie Mae applied accounting methods and practices that do not comply with Generally Accepted Accounting Principles ("GAAP") in accounting for the enterprise's derivatives transactions and hedging activities; (2) that Fannie Mae had materially understated its accrued cost-of-access liability by $50-$80 million; (3) that Fannie Mae used "cookie jar" accounting wherein it arbitrarily distributed current gains to subsequent quarters in a bid to keep its revenue and earning growth steady; (4) that Fannie Mae deferred expenses to achieve bonus compensation targets; (5) that Fannie Mae had insufficient and inadequate internal controls; and (6) that as a result, the value of the Company's net income and financial results was materially misstated at all relevant times. On September 22, 2004, Fannie Mae, prior to the opening of the market, issued a statement, revealing that over a year ago, the Office of Federal Housing Enterprise Oversight ("OFHEO") began a special examination of Fannie Mae's accounting policies and practices, and that the report of that examination -- delivered to Fannie Mae on September 20, 2004 -- concluded that Fannie Mae applied accounting methods and practices that do not comply with GAAP in accounting for the enterprise's derivatives transactions and hedging activities, employed an improper 'cookie jar' reserve in accounting for amortization of deferred price adjustments under GAAP, tolerated related internal control deficiencies, in at least one instance deferred expenses apparently to achieve bonus compensation targets, and maintained a corporate culture that emphasized stable earnings at the expense of accurate financial disclosures. Fannie Mae also disclosed that the Securities and Exchange Commission has been conducting an informal inquiry that includes issues raised in the OFHEO report. In the wake of Fannie Mae's announcement, on September 22 shares of Fannie Mae fell $4.96 per share, or 6.56 percent, to close at $70.69 per share on unusually high trading volume. On September 23, shares of Fannie Mae fell an additional $3.54 per share, or 5.01 percent, to close at $67.15 per share. For more detail, contact the law offices of 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. SIRVA INC.: Lasky & Rifkind Lodges Securities Fraud Suit in IL -------------------------------------------------------------- The law firm of Lasky & Rifkind, Ltd., initiated a lawsuit in the United States District Court for the Northern District of Illinois, on behalf of persons who purchased or otherwise acquired publicly traded securities of Sirva, Inc. ("Sirva" or the "Company") (NYSE:SIR) between November 25, 2003 and November 9, 2004, inclusive, (the "Class Period"). The lawsuit was filed against Sirva and Brian P. Kelley, Joan E. Ryan, James W. Rogers and Richard J. Schnall ("Defendants"). 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. Specifically, the complaint alleges that Sirva's financial statements issued during the class period, including those in its IPO prospectus, were materially false and misleading because Sirva's insurance and claim reserves were inadequate and as a result the Company's earnings were materially inflated, and violated generally accepted accounting principles, ("GAAP"). In addition, the complaint alleges that the Company mischaracterized its business model as "asset-light" when in fact it later described its European operations as "asset-intensive", which in fact represented a significant undisclosed risk to the Company. On November 9, 2004, Sirva announced that it would take a $15.2 million charge to bolster its insurance reserves, which had a negative impact to earnings. Moreover, its insurance business had deteriorated so significantly that the Company had to discontinue entire lines of its insurance business. The Company also reported poor results from its European operations. In reaction to the news, Sirva shares sank, dropping from $23.78 to $17.95 in heavy volume. For more details, contact Lasky & Rifkind, Ltd. by Phone: (800) 495-1868 or by E-mail: investorrelations@laskyrifkind.com. SIRVA INC.: Marc S. Henzel Lodges Securities Fraud Suit in IL ------------------------------------------------------------- The law offices of Marc S. Henzel initiated a class action lawsuit in the United States District Court for the United States District Court for the Northern District of Illinois on behalf of all of the common stock of SIRVA, Inc. (NYSE: SIR) between November 24, 2003 and November 9, 2004, inclusive (the "Class Period") and on behalf of purchasers who bought SIRVA common stock pursuant to and/or traceable to the Company's June 8, 2004 Registration Statement. The complaint charges SIRVA and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. SIRVA is in the global relocation industry, providing its solutions to a diverse customer base, including transferring corporate and government employees and moving individual consumers. According to the Complaint, 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 maintained inadequate reserves in the Network Services division; (2) that the growth and profitability of the Network Services division was being adversely affected; (3) that SIRVA failed to rationalize capacity, reduce fixed costs, and generate a more meaningful relocation volume growth in its European division; and (4) that the profitability of the European operations was suffering. Additionally, during the Class Period and with the Company's stock trading at artificially inflated prices, Company insiders embarked on an insider trading scheme. As a result of the insider trading scheme, Company insiders reaped more than $336 million in gross proceeds. On November 9, 2004, SIRVA reported third-quarter profit fell from the year-ago period as the Company booked a $15.2 million charge to increase insurance loss reserves. The Company said due to higher reserves for U.S. insurance claims and continued poor market conditions in Europe, 2004 earnings from continuing operations are now projected to be between 86 cents and 87 cents. For 2005, it expects to post earnings in the range of $1.25 to $1.30 per share. News of this shocked the market. Shares of SIRVA fell $5.83 per share, or 24.52 percent, to close at $17.95 per share. For more detail, contact the law offices of 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. STAR GAS: Pomerantz Haudek Sets Lead Plaintiff Deadline ------------------------------------------------------- The law firm of Pomerantz Haudek Block Grossman & Gross LLP, which has filed a class action lawsuit against Star Gas Partners, L.P. ("Star Gas" or the "Company") (NYSE:SGU) and two of the Company's senior officers, on behalf of all persons or entities who purchased the securities of Star Gas during the period between December 4, 2003 through October 18, 2004, inclusive (the "Class Period"), reminds investors that they have until Monday, December 20, 2004 to seek appointment by the Court as one of the lead plaintiffs in this action. The lawsuit alleges that defendants issued false and misleading statements concerning the Company's operations, business model, financial results and growth prospects. According to the Complaint, defendants caused Star Gas's securities to trade at artificially inflated levels through the issuance of false and misleading statements. As a result of this inflation, Star Gas was able to complete a secondary offering of 1.3 million common units and two note offerings totaling $65 million, raising net proceeds of $95 million during the Class Period. Specifically, defendants concealed from investors that the Company was experiencing massive delays in the centralization of its dispatch system, causing customers to flee to competitors, that the company's Petro heating oil division's process improvement program was not delivering the benefits claimed by Defendants, and that contrary to prior indications, the Company could not maintain profit margins in its heating oil segment. On October 18, 2004, the Company indicated that results at its heating oil unit were expected to decline significantly, which would inhibit it from meeting borrowing conditions under its working capital credit line. In reaction to this news, shares of Star Gas dropped dramatically, falling from $21.60 per share to close at $4.32 the following day. For more detail, contact Andrew G. Tolan, Esq. of Pomerantz Haudek Block Grossman & Gross LLP by Phone: 888-476-6529 ((888) 4-POMLAW) or by E-mail: agtolan@pomlaw.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. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *