/raid1/www/Hosts/bankrupt/CAR_Public/050107.mbx              C L A S S   A C T I O N   R E P O R T E R

              Friday, January 7, 2005, Vol. 7, No. 5


ALBERTSONS, INC.: CA Judge Grants Certification To Wage Lawsuit
ARIZONA: State Supreme Court Takes On Lawsuit V. Tucson Citizen
AUSTRALIA: 50 Woolgrowers Expected To Join Lawsuit Against PETA
CALIFORNIA: Judge Set To Approve Cosmetics Antitrust Settlement
CALIFORNIA: Taser Gun Victim's Family Intends To Launch Lawsuit

CALIFORNIA: Court To Hear Arguments on Effect of Proposition 64
CALIFORNIA: Lompoc Students To Benefit From Education Suit Pact
CAPITOL ONE: MN Attorney General Sues Over Misleading Marketing
CHINA AVIATION: Singapore Group Not Interested in Filing Lawsuit
CONOCOPHILLIPS: Judge Approves 2003 Chemical Spill Lawsuit Pact

ELITE ACTIVITY: KY AG Says "Gifting Club" is Pyramid Scheme
FALUN GONG: Lawsuit V. Chinese Journalist Tests Alien Tort Law
HAIL RESTORATION: IL AG Madigan Launches Consumer Fraud Lawsuit
HMO LITIGATION: CT High Court Upholds Dismissal of CSMS' Lawsuit
HONEYWELL INTERNATIONAL: IL AG Files Suit V. Massac County Plant

ILLINOIS: Pres. Bush Visits Illinois, Calls For Limit On Suits
INTEGRATED CREDIT: MA AG Sends Out Checks in Consumer Suit Pact
J.D. BYRIDER: KY AG Stumbo Launches Consumer Protection Lawsuit
KGC CONSTRUCTION: IL AG Madigan Launches Consumer Fraud Suit
MESSERLI & KRAMER: Faces MN AG Lawsuit Over Collection Practices

METABOLIFE INTERNATIONAL: Seeks Settlement of Ephedra Litigation
MINNESOTA: City of St. Paul Sued Over Vendor Outreach Program
OHSL CORPORATION: Dismissed Oak Hills Case Re-filed in DE Court
PENNSYLVANIA: Suit Filed V. Kerr-McGee, T.P For Causing Ailments
SAGEE USA: Settles FTC Suit Over Unsubstantiated Health Claims

TV AZTECA: CEO Ricardo B. Salinas Says SEC Accusations False
UNITED STATES: Chamber of Commerce Hails Action on S. 2062 Bill
WORLDCOM INC.: Ten Former Directors Reach $54M Suit Settlement

                         Asbestos Alert

ASBESTOS LITIGATION: Tyco Int'l, Subsidiaries Fight 14,500 Cases
ASBESTOS LITIGATION: ATRA Identifies Top 9 "Judicial Hellholes"
ASBESTOS LITIGATION: Armstrong Creditors Await January Ruling
ASBESTOS LITIGATION: Advisers Explain How Work Tax Relief Works
ASBESTOS LITIGATION: ArvinMeritor, Maremont Meets Injury Claims
ASBESTOS LITIGATION: ArvinMeritor Faces Rockwell Product Claims

ASBESTOS LITIGATION: FiberMark Says Debtors Named in 11 Lawsuits
ASBESTOS LITIGATION: BlueLinx Notes Unresolved Claims Facing GP
ASBESTOS LITIGATION: WR Grace Acts to End State Control at Site
ASBESTOS LITIGATION: Parents Act to Abolish Asbestos Classrooms
ASBESTOS LITIGATION: Monsanto Co. Reserves US$285MM for Solutia

ASBESTOS LITIGATION: Test Results Intensify Worries at MA Court
ASBESTOS LITIGATION: Hardie Agrees to Asbestos Settlement Deal
ASBESTOS LITIGATION: Father, Son Get Prison in Removal Scam Case
ASBESTOS LITIGATION: Ex-worker Files GBP50T Claim V. RG Carter
ASBESTOS LITIGATION: NZ Victims Fight for Part of Hardie Deal

ASBESTOS LITIGATION: French Senate to Study Contamination Issue
ASBESTOS LITIGATION: 9/11 Rescue Dog Takes Part in Health Study
ASBESTOS LITIGATION: Union Pacific Sets $153.6MM Asbestos Charge
ASBESTOS LITIGATION: Tasmanian Victims Gain More Time for Claims
ASBESTOS LITIGATION: Courts Order Plaintiffs to Prove MS Ties

ASBESTOS LITIGATION: NZ Man Fighting For Compensation Inclusion
ASBESTOS LITIGATION: Dana Corp and Insurers Sign Settlement Deal
ASBESTOS LITIGATION: Councilors Call for More Tests at TBA Site
ASBESTOS LITIGATION: PBS Approval of Alimta Encounters Setbacks
ASBESTOS LITIGATION: BHP Billiton Faces Pressure to Put Up $240M

ASBESTOS LITIGATION: Aearo Increases Liability Estimate For 2004
ASBESTOS LITIGATION: Halliburton's $5Bil Asbestos Deal Closed
ASBESTOS LITIGATION: Oglebay Norton Co Named by 73,000 Claimants
ASBESTOS LITIGATION: Senate Panel Seeks End to Asbestos Lawsuits
ASBESTOS LITIGATION: UK School Union Demands Release of Findings

ASBESTOS LITIGATION: Exposure Causes Autoimmune Diseases, Study
ASBESTOS LITIGATION: ABB Sees No Major Change In Claims Amount
ASBESTOS LITIGATION: Asbestos in UK Schools Still Under Scrutiny
ASBESTOS LITIGATION: FPB Warns Local Firms to Comply with Plan
ASBESTOS LITIGATION: Assurant Cites Continued Exposure to Claims

ASBESTOS LITIGATION: Expert Recommends Fingerprint Asbestos Test
ASBESTOS ALERT: Fears of Asbestos Release Arise After House Fire
ASBESTOS ALERT: NC City Tests Show High Levels in Drinking Water
ASBESTOS ALERT: Builder of Site Over Dump Files for Bankruptcy
ASBESTOS ALERT: Widow Faces Red Tape Woes in Claim Attempts

ASBESTOS ALERT: Inquest Reveals Pipe Fitter Died from Asbestos
ASBESTOS ALERT: Secondary Exposure Claims Life of Plumber's Wife
ASBESTOS ALERT: Royal Navy Man Died Due to Asbestos Exposure
ASBESTOS ALERT: Standard Telephone Ex-worker Files GBP150T Claim
ASBESTOS ALERT: Widow Sues BAE Systems, British Aircraft Corp.

ASBESTOS ALERT: GA Supreme Court Denies John Crane Inc.'s Appeal
ASBESTOS ALERT: Court Dismisses Leggett & Platt Worker's Claim
ASBESTOS ALERT: TX Appeals Court Upholds Ruling V. Borg-Warner
ASBESTOS ALERT: DEP Warns 3 FL Contractors for Skipping Surveys
ASBESTOS ALERT: Water Pik Technologies Faces Asbestos Lawsuits

ASBESTOS ALERT: WorkCover Probes Walkout at Mall Due to Asbestos

                   New Securities Fraud Cases

ATHEROGENICS INC.: Schiffrin & Barroway Lodges Stock Suit in NY
CHINA AVIATION: Lerach Coughlin Lodges Securities Suit in NY
GEOPHARMA INC.: Lasky & Rifkind Sets Lead Plaintiff Deadline
MEDQUIST INC.: Goodkind Labaton Sets Lead Plaintiff Deadline
ROYAL GROUP: Lasky & Rifkind Lodges Securities Suit Fraud in NY

SUPPORTSOFT INC.: Goodkind Labaton Sets Lead Plaintiff Deadline


ALBERTSONS, INC.: CA Judge Grants Certification To Wage Lawsuit
A Los Angeles judge granted class-action status to a lawsuit
alleging Albertsons Inc. violated a California law governing the
payment of wages when employees leave an employer, the Los
Angeles Times reports.

Under California law employers are required to pay discharged
employees immediately and pay employees who quit or resign
within 72 hours. For employees who give 72 hours notice, the
employer must pay the employee at the time of quitting.

In the lawsuit, employees who worked at Albertsons, Lucky Stores
Inc., and Sav-on drugstores, two chains Albertsons acquired in
1999 are seeking penalties of one day's pay for each day they
allege that their paychecks were delayed, according to the

ARIZONA: State Supreme Court Takes On Lawsuit V. Tucson Citizen
The Arizona Supreme Court is taking up the case of a newspaper
that was slapped with lawsuits after it published a letter
suggesting American soldiers in Iraq respond to attacks by
killing Muslims at nearby mosques, the Associated Press reports.

The Tucson Citizen ran the controversial letter on December 2,
2003. It prompted protests and some Muslims were so scared they
kept their kids home from school. The paper published an apology
and sent staff members to meet with members of a local mosque.

However, the newspaper was slapped with a class-action lawsuit a
month later, which argues that the newspaper's wasn't
constitutionally protected when it published the letter because
it was a direct call to violence. The newspaper on the other
hand contends its First Amendment rights are at risk.

As previously reported in the September 21, 2004 edition of the
Class Action Reporter, the letter, which was written by a
certain Dr. Emory Metz Wright, Jr. made a suggestion about
"going to the nearest mosque and killing five Muslims." The
letter eventually resulted in terrified Muslims keeping their
children from going to religious school.

The controversial decision to print the article elicited
numerous protest letters from readers. The newspaper immediately
issued an apology and sent staff members to meet with members of
a local mosque in a bid to diffuse tensions.

However, on January 13, 2004, two men initiated a class-action
lawsuit against the newspaper on behalf of Islamic-Americans,
and thus the Arizona Supreme Court is being asked to decide
whether to overturn a trial judge's ruling allowing the
newspaper to be sued for alleged distress caused by what it

According to the newspaper its First Amendment rights protect it
from such lawsuits and that the most fundamental of this rights,
the right to engage in robust political debate, is at stake, but
the plaintiffs contend that the newspaper, by deciding to
publish the letter, crossed the line.

Aly Elleithee, an accountant and immigrant from Egypt, who is
one of plaintiffs in the case points out, "You can express your
opinion but not - especially with what's going on in the Middle
East - if you put some people's lives at risk. Somebody has to
be accountable for what they did."

Plaintiffs' attorney Herbert Beigel further adds that publishing
the letter was not constitutionally protected because the letter
"was a direct call to violence against innocent Islamic-

On May 10, 2004, Judge Leslie Miller of Pima County Superior
Court in Tucson dismissed an assault count in the original
lawsuit, but allowed the suit's claim of intentional infliction
of emotional distress to stand. A pretrial fact-finding is
currently on hold while the ruling is appealed.

An administrator of the Islamic Center of Tucson said many
members of the mosque were alarmed when the letter was published
but since have been satisfied with the newspaper's response.

AUSTRALIA: 50 Woolgrowers Expected To Join Lawsuit Against PETA
Australian woolgrowers are contemplating supporting a class
action filed against the animal rights group PETA by Australian
Wool Innovation, ABC News reports.

Around 50 Tasmanian growers are expected to join the suit, which
alleges that PETA's international campaign against mulesing and
the live sheep trade is directly affecting woolgrowers' incomes
and reputations.

Jim Cooper from Tasmania's Farmers and Graziers Association told
ABC News if the campaign's not stopped, PETA will lobby against
other areas of agriculture.

"It won't just be restricted to production of wool and sheep,"
he said.  "They'll move in on the cattle industry; they're
certainly active in the pig industry currently; the pulp
industry will cop a fair whack; and then they'll move onto the
racing industry: so people should not be shrinking violets in
this instance.  I think we need to stand up and be counted."

CALIFORNIA: Judge Set To Approve Cosmetics Antitrust Settlement
Customers of Macy's and other Federated Department Store chains
could be eligible for free cosmetics and fragrances if a
California judge approves settlement of a class-action lawsuit,
which is unrelated to the antitrust case with Wedgwood Waterford
and Lenox Inc. and Federated settled last August with the state
of New York, the Cincinnati Enquirer reports.

Judge Saundra Brown Armstrong is scheduled to hear details
involving the settlement of the suit in her Oakland court, whose
settlement hearing was postponed from November 16.

Federated and several high-end cosmetics makers have offered to
give away about $175 million of beauty care products to
consumers to end the case. To avail of the giveaways, U.S.
consumers must prove that they bought cosmetics from related
department stores between May 29, 1994, and July 16, 2003.

The suit, Azizian vs. Federated, contends that nine cosmetics
manufacturers and eight department stores conspired to fix
prices of make-up such as eye shadow, lipstick, skin creams,
moisturizers and fragrances. Furthermore, the lawsuit contended
that Estee Lauder, Federated and other defendants engaged in the
price-fixing scheme to never discount the manufacturer's
suggested retail price on cosmetics. The defendants did not
admit wrongdoing but agreed to the giveaway in July 2003.

CALIFORNIA: Taser Gun Victim's Family Intends To Launch Lawsuit
The San Mateo County District Attorney's office continues to co-
investigate two officer-involved deaths that recently occurred,
while the Pacifica Police Department faces a likely lawsuit from
one victim's family, the San Francisco Examiner.

The family of 30-year-old Greg Saulsbury, who died at Seton
Medical Center after getting shocked at least once by Pacifica
police with a Taser gun, retained the services of Oakland
attorney John Burris. Mr. Burris, who represented plaintiffs in
the infamous Oakland "Riders" class-action lawsuit, told the San
Francisco Examiner, he agreed to take the case after talking
with Mr. Saulsbury's family.

Regarding the issue of Tasers, he further told the newspaper,
"The whole issue about Tasers has been a matter of public
discussion for some time. I think in this case they were
inappropriately used. I've talked to the family, and they told
me what happened, and I'm not generally impressed with the
officers' version."

Mr. Saulsbury's actual cause of death and its connection to the
Taser shock is still unknown. An autopsy is scheduled soon.

Pacifica police claim Mr. Saulsbury was acting combative and
resisting arrest in his grandmother's home on the 400 block of
Inverness Drive in Pacifica. Police Capt. Jim Tasa said officers
responded to a 911 medical call and entered the house to secure
the area for medical personnel. However, he did not elaborate on
any details of the incident, such as how many times Mr.
Saulsbury was tased.

Though not elaborating on some of the details, police captain
did tell The Examiner, "It's unfortunate obviously, but we are
working in conjuncture with the San Mateo County District
Attorney's office to make sure we get all the facts straight and
verify exactly what happened."

On the other hand, Mr. Saulsbury's grandmother, Clarice
Patterson, told The Examiner that an ambulance never arrived at
the house, and that against her will, at least seven officers
pushed past her into the house just before midnight Sunday. She
adds, "They were just wrong ... they came in like vigilantes,
like they were hyped up on something. They didn't have a

Family members told The Associated Press that Mr. Saulsbury was
acting paranoid and irrational and was possibly on drugs,
however Mrs. Patterson said her grandson was just sick and
simply lying down in a back room when officers arrived. She said
police shocked Mr. Saulsbury several times with the Taser while
trying to arrest him, and that his father, Gregory Saulsbury
Sr., was also tased when he attempted to intervene on his son's

CALIFORNIA: Court To Hear Arguments on Effect of Proposition 64
A Los Angeles Court of Appeals panel is set to hear arguments on
whether Proposition 64 will affect lawsuits pending on November
2, when the initiative was passed with 59 percent of the votes,
the San Francisco Chronicle reports.

Under present law, lawsuits can be filed against companies for
alleged unfair business practices on behalf of the public in
general. According to its supporters, Proposition 64 would only
allow individual or class action suits if there is actual harm
or financial loss claimed by a plaintiff and that only
government entities would be able to enforce these laws on the
public's behalf, an earlier Class Action Reporter story
(November 5,2004) story states.

Since Prop. 64 was passed, businesses that faced such suits have
asked for the dismissal of the suits filed before November 2.
The suits number well over 100, according to advocates on both
sides.  Some of those suits include claims of illegal marketing
to minors, cell phone overcharges, concealment of credit card
fees and understaffing at a nursing home, said the Foundation
for Taxpayer and Consumer Rights, the Chronicle reports.
Business groups described the suits as shakedowns and said they
were typically used to coerce companies into settlements that
included attorneys' fees.

Lawyers say some of those cases could be refiled with other
plaintiffs, but many would be permanently scuttled.  That would
be fine with John Sullivan, president of the Civil Justice
Association of California, which sponsored Prop. 64.  "We're not
looking at a case that is trying to get some money back," he
told the Chronicle.  "We're talking about lawyers looking for
their fees. So there's no harm in stopping those kinds of cases

The harm, said Newport Beach attorney Sharon Arkin, president of
Consumer Attorneys of California, includes the dismissal of some
suits that were filed several years ago and resulted in
injunctions that businesses are still appealing.  "These are
legitimate cases that people were bringing on behalf of
consumers," she told the Chronicle.

At least 15 Superior Court judges have already ruled on whether
Prop. 64 applies to pending cases. The hearing this week, in a
suit by an insurance company that accused another insurer of
stealing its clients, is the first before an appeals court,
whose rulings serve as precedents for other cases.

An appellate court in Santa Ana, considering only written
arguments, is scheduled to rule by mid-March on whether Prop. 64
applies to a consumer group's suit against DaimlerChrysler, in
which a judge ordered the automaker in 2001 to repair or replace
defective cars. Either or both of those cases could soon reach
the state Supreme Court for a definitive ruling.

The text of Prop. 64 did not discuss its application to cases
already on file. The omission was deliberate, because "nobody
wanted to clutter it up with an issue that I felt we had a
pretty good chance of winning in the courts," Fred Hiestand, the
Civil Justice Association's general counsel told the Chronicle.

Arkin, of the Consumer Attorneys group, said an initiative that
fails to mention retroactivity shouldn't be ruled retroactive.
"This was their wish list," she told the Chronicle.  "They could
have put into it anything they wanted, including a retroactivity

No such clause was needed, argue lawyers for business
defendants, because Prop. 64 decreed that certain plaintiffs --
those who fail to claim direct injury -- should no longer be
allowed in California courts, regardless of when they sued.

Consumer advocates believe they hold a trump card: an e-mail
sent in September from the official Prop. 64 campaign, saying
the measure was not retroactive, in response to an inquiry from
Daniel Sigler, an Orange County attorney. But the Civil Justice
Association's Sullivan shrugs it off.  "True, it's not
retroactive," he told the Chronicle. "The initiative took effect
on Nov. 3. It doesn't change any litigation that was concluded
or decided before that date."

CALIFORNIA: Lompoc Students To Benefit From Education Suit Pact
Students in Lompoc, California will soon see the results of a
settlement of a class action filed against the State of
California and its education agencies, alleging that the state's
schools were lacking basic provisions, including adequate
facilities, teachers and materials, the Lompoc Record reports.

The American Civil Liberties Union (ACLU) filed the suit, styled
"Williams v. California," on behalf of nearly 100 San Francisco
County students.  The suit alleges that the state reneged on its
constitutional obligation to provide students with bare
essentials necessary for education.

To settle the suit, a four-bill legislative package was created,
covering a broad scope of issues regarding facilities funding,
instructional materials, teacher credentials and public
reporting to the School Accountability Report Cards, among other
issues.  The settlement specifically targets schools that are
ranked in the lowest tiers of the state's Academic Performance

As a result of the settlement, each public school in California
must have in place a uniform complaint process that specifically
deals with basic provisions public schools are required to
provide. Likewise, each classroom must have a displayed notice
that informs students about the process.

Under the settlement, students and parents can also file
complaints about school deficiencies to their school principals,
in person or anonymously.  Principals must fix valid complaints
within 30 days.  If not satisfied with the resolution, the
student, parent or teacher may file an appeal to the school
board or the district superintendent, or for facilities problems
directly to the state Allocation Board.  School districts will
provide public summaries of all complaints and their resolutions
quarterly, the Lompoc Record reports.

Notices should begin appearing this month in classrooms in
Lompoc Unified School District, Ann Gary, Lompoc Unified School
District (LUSD) superintendent told the Record.

The settlement specifically targets schools that are ranked in
the lowest tiers of the state's Academic Performance Index.
Arthur Hapgood and Clarence Ruth Elementary are the only two
schools in LUSD in those low tiers, which makes them eligible
for additional funding to fulfill any requirements named in the
settlement.  "Hapgood and Clarence Ruth qualify in ranking, but
I don't know if money will flow that far," Ms. Gary told the
Record.  "We're talking about big districts like L.A."

While advocates have praised the settlement as a landmark case
that ensures recourse for students suffering in inadequate
schools, critics say that the settlement doesn't have the
financial muscle to stretch across 2,300 struggling schools.
"It's not going to be the panacea that some people think," Jack
O'Connell, state superintendent told the Record. "It's going to
take more money to help some of those very challenged schools."

A San Francisco Superior Court judge is expected to give final
approval of the settlement March 23.  Any parents or students of
state public schools have until February 15 to file objections
to the planned settlement, the Record reports.

CAPITOL ONE: MN Attorney General Sues Over Misleading Marketing
Minnesota Attorney General Mike Hatch filed a lawsuit against
Capital One Bank and Capital One F.S.B. for using false,
deceptive and misleading television advertisements, direct-mail
solicitations, and customer service telephone scripts to market
credit cards with allegedly "low" and "fixed" interest rates
that, unlike its competitors' rates, will never increase.  In
fact, the lawsuit alleges that Capital One increases the
interest rate on such cards up to 400% for consumers who trigger
a "penalty" rate by defaulting in any number of ways.

"Capital One aggressively markets its brand image as the credit
card company with the nation's lowest fixed rates," Attorney
General Hatch said in a statement. "But that image is false. If
you do something as simple as pay a day late, your rate with
Capital One can sky-rocket overnight."

The State's suit alleges that Capital One uses "penalty rate"
pricing to offer a supposedly "fixed" interest rate to
consumers, but then increases that rate when an individual
account holder defaults. Capital One also retains the right to
unilaterally increase an account holder's interest rate--for any
reason or no reason at all--based upon a "change in terms"
provision in its credit card agreement.

Specifically, the lawsuit faults Capital One's marketing
practice as follows:

     (1) Television Ads: Capital One runs television ads with
         the same basic format, script, graphics and visual
         punch line designed to create the false and deceptive
         impression among consumers that its competitors' rates
         will increase, but Capital One's rates will not. In
         Capital One's "No-Hassle" ads, for instance, two people
         compete to pay for lunch, one with a competitors' card,
         the other with a Capital One card which has a "low and
         fixed" rate. When the man with a competitor's card asks
         what's going to happen to his rate, he is physically
         shot upward by a catapult operated by barbarians or a
         breaching whale. Capital One then orally and visually
         tells consumers that it offers the nation's lowest
         fixed rate at 4.99%.

     (2) Written Solicitations: Capital One bolsters its false
         television ads with deceptive direct mail
         solicitations. In one solicitation, for instance,
         Capital One describes its 4.99% interest rate as "low"
         thirteen times and as "fixed" seventeen times,
         including on both sides of the envelope, in the body of
         the text, in the application itself and elsewhere,
         including boxes comparing the interest rates and
         "savings" of Capital One's credit cards with consumers'
         other loans.

     (3) Customer Service Scripts: When consumers contact
         Capital One to apply for the card, Capital One scripts
         its customer service representatives to evade a direct
         response to the question "What does fixed mean?"
         Capital One answers: "Unlike most credit card
         companies, Capital One's fixed rate is not variable and
         will not go up and down as interest rates change." Only
         if a consumer "probes" another two times does Capital
         One concede that it cannot guarantee that its rates
         will stay the same forever.

Filed in Ramsey Country District Court, the State's lawsuit
alleges that Capital One's marketing practices violate
Minnesota's laws prohibiting false advertising, consumer fraud,
and deceptive trade practices. The suit seeks injunctive relief
prohibiting Capital One's false, deceptive and misleading
conduct and civil penalties.

The defendants are Capital One Bank and Capital One F.S.B. Both
are Virginia-based entities that offer credit card products to
prime and subprime consumers. Capital One is one of the top ten
largest credit card issuers in the United States. According to
Capital One Financial Corporation's most recent Form 10-Q filing
with the U.S. Securities and Exchange Commission, Capital One's
domestic credit card loans totaled $46.1 billion as of September
30, 2004. These loans generated net income of $414.4 million for
July, August and September, 2004, a 50% increase from the same
period in 2003. Capital One's marketing expenses were $826.6
million from January through September, 2004. Capital One's
solicitations claim that the company has 46 million customers.

For more details, contact the Office of Minnesota Attorney
General Mike Hatch by Mail: 1400 NCL Tower, 445 Minnesota Street
St. Paul, MN 55101, by Phone:  (651) 296-3353, 1-800-657-3787,
TTY: (651) 297-7206, TTY: 1-800-366-4812.

CHINA AVIATION: Singapore Group Not Interested in Filing Lawsuit
The Securities Investors Association Singapore (SIAS) is not
interested in filing a lawsuit against China Aviation Oil
(Singapore) Corporation, Ltd. (CAO), despite a class action
filed in the United States by a prominent law firm, XFN Asia

The Company has been suspended from trading on the Singapore
exchange since November 29.  The Monetary Authority of Singapore
and the police is conducting a probe on the Company after it
shocked the market on November 30 when it announced that it had
racked up US$550 million in derivatives oil trading losses.

According to PrimeZone Media Network, a press release newswire,
US law firm Murray, Frank & Sailer LLP has filed a class action
lawsuit in New York, on behalf of shareholders who purchased or
otherwise acquired CAO shares between February 5, 2004 and
November 30, 2004.  The law firm alleges that, during this
period, CAO issued false and misleading statements regarding the
company's business and prospects.  It is not clear from the
press release how many shareholders are represented by the law
firm, which urges other shareholders to join the class action
lawsuit by March 6.

SIAS President David Gerald told XFN Asia his group is opposed
to any lawsuits against the Company.  "Legal action is a
negative approach. We want to give the company time for
restructuring," he told XFN Asia.  "The company has no money.
Who will benefit from such a lawsuit? The lawyer."

CONOCOPHILLIPS: Judge Approves 2003 Chemical Spill Lawsuit Pact
A judge has recently approved a tentative settlement in a class
action lawsuit filed against ConocoPhillips over a 2003 chemical
release at the company's Westlake plant, the Associated Press

According to ConocoPhillips spokeswoman Michelle Woodyear, State
District Judge Wilford Carter issued an order granting
preliminary approval of the settlement. The Company did not
release the terms of the deal. An attorney for the plaintiffs
said the agreement prohibited him from speaking about settlement
details without the company's permission.

The suit stems from a leak of sulfur dioxide at the
ConocoPhillips facility in Westlake on January 18, 2003. In a
report the Company filed with state regulators, a power outage
that day caused the release of 64 tons of sulfur dioxide.

Though declining to discuss he more intricate details of the
settlement, Ms. Woodyear did tell the Associated Press that the
settlement also covers claims from two other smaller incidents:
a May 14, 2003, release of 40 tons of sulfur dioxide and a 2002
incident that did not result in any off-site release of
chemicals. She also stated that between 18,000 and 20,000 people
have submitted claims.

ELITE ACTIVITY: KY AG Says "Gifting Club" is Pyramid Scheme
An investigation by Kentucky Attorney General Greg Stumbo's
Consumer Protection Division has found that an illegal "gifting"
program known as "Elite Activity" is operating in Lexington and
Louisville.  The Attorney General advised Kentuckians to avoid
promotion and/or participation in this program.

AG Stumbo's office was alerted by several churches and consumers
who called the office questioning whether the recruitment
solicitations being made by individuals for them to join and
promote the activities of Elite Activity was asking them to
participate in a pyramid scheme.  An ongoing investigation
verified that the program is in fact a pyramid scheme, according
to Kentucky's Consumer Protection laws.

The Lexington and Louisville scheme is virtually identical to
many so-called "gifting clubs" being solicited within Kentucky
and around the country.  These so-called gifting clubs are not
charitable in nature because each prospective participant has an
expectation of return on their initial investment.  A pyramid
promotional plan is defined by law as a plan or operation by
which a person gives consideration (something of value like
money) for the opportunity to receive compensation that is
derived primarily from a person's introduction of other people
to participate in the plan or operation, instead of from the
sale of a product or service by the person introduced into the
plan or operation.

This Elite Activity scheme works like this: People are solicited
to invite only friends that they know to invest $100 to get into
the alleged "gifting" program. People are promised a payoff of
up to $48,000 in gifting contributions to be paid by others
participating in multiple gifting programs. The scheme spreads
when individuals invite friends, and in this case, fellow church
members to enroll in the program. Participants are told that it
is not an illegal pyramid but in fact that an attorney had
researched the law and found the plan to be a legitimate gifting
club under federal tax laws.

According to the Attorney General's office, these
representations are not true. Under Kentucky's law, you may not
promote or participate in a pyramid promotional scheme. Not only
does this conduct violate the Consumer protection Act but each
person involved could be convicted of a Class C felony which
carries a penalty of 5 to 10 years in prison.

"The participants are required to recruit at least two people
each to qualify for monetary payoffs in the program, initial
consideration is paid by each participant and no product or
service is sold to qualify for payout of money. Clearly, each
element of proof required to demonstrate that the Elite Activity
program is an illegal pyramid is present," said AG Stumbo.

AG Stumbo has concluded that this and similar programs are
doomed to fail leaving hundreds of investors no return and a
loss of any money invested. The Attorney General's Office has
gone to court to halt similar programs. This program and those
who choose to participate in it will be treated no different
according to the Attorney General.  People who encounter others
promoting the Elite Activity scheme or other illegal activities
may contact the Attorney General's Consumer Protection Division
at 888-432-9257.

For more information, please contact the Office of the Attorney
General by Mail: State Capitol, Suite 118, Frankfort, Kentucky
40601, by Phone: (502) 696-5300

FALUN GONG: Lawsuit V. Chinese Journalist Tests Alien Tort Law
A lawsuit filed against a Chinese television station director by
followers of Falun Gong, a spiritual practice banned in China is
testing the limits of the Alien Tort Statute, the 215-year-old
law allowing foreigners to sue in federal court over serious
human rights violations anywhere in the world, The New York
Times reports.

Falun Gong is a form of qigong, an ancient Chinese practice of
yogalike breathing exercises.  In 1999, the Chinese Government
outlawed the practice.  Members of the movement say they have
been sent to prisons, labor camps and mental hospitals and that
they have been tortured with electric shocks and nerve-damaging
drugs.  Independent human rights groups have confirmed many of
the charges.  The State Department, too, most recently in a
September report on religious freedom in China, said, "there
have been credible reports of deaths due to torture and abuse."

Followers of Falun Gong filed the suit against Zhao Zhizhen,
director of a television station in Wuhan, China, who was
visiting his daughter in New Haven, Connecticut, after she
graduated from Yale.  The suit alleges that the broadcasts Mr.
Zhao produced and supervised were propaganda "reminiscent of
Nazi stereotypes of Jews and Ku Klux Klan stereotypes of
African-Americans."  The programs allegedly incited violence
against Falun Gong practitioners in China.

At least six lawsuits have been filed against Chinese officials
in the United States. The lawsuits are a source of diplomatic
friction, and the State Department has filed papers in several
cases urging courts not to hear them.   Similar lawsuits by the
movement's followers are not unusually and officials usually
ignore them.

However, Mr. Zhao asserts the lawsuit challenges his honor as an
independent and objective journalist.  In court filings, he
asserted that American free speech should protect him, saying
that his programs were not different from 60 Minutes, 20/20 and
Nova.  They cast, he said in a sworn statement, a skeptical eye
on the unusual claims made for the movement's practices.
According to him, Falun Gong " . is seen by supporters as a
spiritual group dedicated to inner serenity, and by critics as a
mind-control cult led by Li Hongzhi, a charlatan who claims
supernatural powers," the Times reports.

Bruce Rosen, Zhao's lawyer, said his client was not aware of
such abuses, according to the Times.  "If someone has been
tortured or mistreated in the way it's described in the
complaint," Mr. Rosen said, referring to the lawsuit, "it's not
something he would support."

The suit pits a growing international hostility to statements
disparaging ethnic and religious groups against the American
tolerance for such speech and tests the limits of the Alien Tort
Statute, azcentral.com reports.  In June, the U.S. Supreme
Court, in a separate case, upheld the law but said lower courts
should apply it cautiously.

Mr. Rosen told the Times the central question in the lawsuit is
whether a U.S. court should entertain an objection to Chinese
journalism.  "The plaintiffs are attempting to use a U.S. law to
punish him for his speech," he said.

However, Terri E. Marsh, a lawyer representing the plaintiffs in
the Connecticut lawsuit, disagreed. "It's not a free speech
case," she told the Times.  "It's a torture case."

Mr. Zhao provided the court with an English translation of the
transcript of one program cited by the plaintiffs, a profile of
Li that was broadcast in 1999. It was, according to the
transcript, largely a series of interviews with people who had
become disillusioned with Falun Gong. It was framed by not
especially fiery socialist rhetoric, and it contained no
explicit calls to violence.

The plaintiffs say other programs were uglier.  "The tactics
deployed in these media reports and TV shows are virtually
identical to those used in Rwanda during the genocide of the
Tutsi by the Hutu," they said in their papers, according to the

A year ago, the international war crimes tribunal in Tanzania
convicted three men for using a radio station and newspaper to
incite genocide in Rwanda. The tribunal suggested that American
law, which it called "the most speech protective" in the world,
might have called for a different result.

Peter Spiro, a specialist in international law at the University
of Georgia School of Law in Athens, said the case against Zhao
"is not completely without foundation" in light of the Rwanda
judgment.  "But that case," he told the Times, "involved
broadcasters who in effect were directing traffic for the Rwanda
massacres, telling persecutors where to find their victims and
the like. In that case, direct complicity with the genocidal
activity was clear. Not so in the case against Zhao."

HAIL RESTORATION: IL AG Madigan Launches Consumer Fraud Lawsuit
Illinois Attorney General Lisa Madigan filed a consumer fraud
lawsuit alleging a door-to-door home repairman soliciting storm-
related roofing repair jobs in Cook, DuPage, Lake and Will
Counties, accepted down payments for repair work and then either
never began or never completed the projects or, in some cases,
actually made the damage worse.

Since February of this year, AG Madigan's office has received 52
consumer complaints alleging Robert K. Olson and his company,
Hail Restoration, Inc., accepted more than $225,000 in down
payments from Illinois residents and then failed to repair
damages to the consumers' roofs.  Sixteen of the 44 complaints
have been filed by senior citizens.

Hail Restoration, an Illinois corporation registered in the
state since December 2003, either has or has had offices in
Elgin, Joliet, Naperville, Berwyn and Chicago. Currently, Hail
Restoration's main office is located at 75 Market St. in Elgin.
Madigan's case was filed in Cook County Circuit Court.

Madigan's lawsuit alleges Olson travels the Chicago area going
door-to-door to solicit work by claiming consumers' homes have
sustained roof damage during storms. Olson allegedly tells
customers his company will repair damaged roofs and negotiate
with insurance companies for a settlement. Many of the consumers
allege they signed contracts with Olson during his first visit
to their homes.

"Our case alleges that Robert Olson walks up to consumers' doors
with claims that he will fix damaged roofs," Madigan said. "The
fact that we've received so many complaints indicates that his
real plans may have more to do with fraud and deception than
actually providing repair services."

According to the complaint, on one occasion in June 2004, the
defendants informed an elderly Maywood resident that she was
entitled to have the hailstorm damage to her home repaired at no
cost. The elderly woman signed a contract with the defendants
and signed over a $7,843 insurance check to the defendants.
Following that, the defendants never showed up at her home to
begin the repair work.

The defendants have been charged with multiple violations of the
Illinois Consumer Fraud and Deceptive Business Practices Act and
the Home Repair and Remodeling Act for failing to complete the
work for which they contracted and, in many cases where work was
begun, for performing substandard work. Madigan's complaint also
alleges the defendants violated the law because they have never
been obtained either a roofing license or a public adjuster's
license in Illinois and failed to inform customers of this.
Finally, the complaint charges that consumers were not provided
with the legally required "Home Repair: Know Your Consumer
Rights" pamphlet.

Madigan's lawsuit asks the court to prohibit the defendants from
engaging in the business of home repair and remodeling and from
further violating Illinois' consumer protection laws. The
lawsuit also seeks a civil penalty of $50,000 and additional
penalties of $50,000 per violation found to be committed with
the intent to defraud. Additionally, the suit seeks $10,000 per
violation committed against a person 65 or older. Finally,
Madigan's lawsuit asks the court to order the defendants to pay
restitution to consumers.

Assistant Attorney General Katrina Wanzer is handling the case
for Madigan's Chicago Consumer Fraud Bureau.  For more
information, visit the Website:
http://www.IllinoisAttorneyGeneral.gov/or call the Attorney
General's Consumer Fraud Hotline: Chicago 1-800-386-5438 TTY
1-800-964-3013, Springfield 1-800-243-0618 TTY 1-877-844-5461,
Carbondale 1-800-243-0607 TTY 1-877-675-9339

HMO LITIGATION: CT High Court Upholds Dismissal of CSMS' Lawsuit
In a favorable ruling for two managed-care companies, the
Connecticut Supreme Court has upheld the dismissal of lawsuits
brought by the Connecticut State Medical Society that sought
class-action status on behalf of the society's member
physicians, alleged the companies participated in an "unfair and
deceptive scheme" to delay and deny full payments to the
doctors, the BestWire Services reports.

The society's suits, brought on behalf of its 7,000 member
physicians, were filed in February 2001 against Oxford Health
Plans Inc. and ConnectiCare Inc. in Connecticut state court,
seeking injunctive relief for the companies' alleged violations
of the Connecticut Unfair Trade Practices Act. The suits alleged
that Oxford and ConnectiCare "systematically" denied requests by
the society's member physicians to pay for services the
physicians provided.

Tim Norbeck, executive director of the Connecticut State Medical
Society, told BestWire the society was disappointed with the
ruling. "We are looking at options...and I'm not sure, frankly,
that we have any," he said. However, "We felt that we did have a
standing to stand up for our members that we felt were being
deprived of the opportunity to provide the best care in
Connecticut," Mr. Norbeck said.

The trial court granted Oxford's and ConnectiCare's motions to
strike the complaints, ruling that the society "lacked standing
because the harm allegedly suffered by the plaintiff was
derivative, indirect and too remote to be actionable."

The society appealed to the Connecticut Appellate Court and the
Connecticut Supreme Court transferred the appeals to itself.

In separate opinions, recently posted on the Connecticut Supreme
Court's Web site, the state high court affirmed the trial
court's judgments in favor of Oxford and ConnectiCare, ruling
that the society lacked standing to sue.

"There can be no dispute that all of the injuries that the
plaintiff allegedly suffered derive solely and exclusively from
the harm allegedly visited upon the plaintiff's members by the
defendant," the court wrote in the Oxford opinion. "In other
words, none of the harm that the plaintiff allegedly suffered as
a result of the defendant's conduct is direct."

The society's member physicians "were directly injured by the
defendant's allegedly improper conduct, and there is nothing to
prevent one or more of them from remedying any such harm," the
court said. "Consequently, the plaintiff's member physicians,
and not the plaintiff itself, are proper parties to an action
seeking redress for the defendant's allegedly improper conduct."

In the ConnectiCare opinion, the court said the society's appeal
arose in a "factual and legal context that is the same in all
material respects" as the Oxford case. Therefore the court
rejected the society's claim that the trial court improperly
granted ConnectiCare's motion to strike and upheld the trial
court's judgment in favor of ConnectiCare.

Last summer, Trumbull, Conn.-based Oxford Health said its
stockholders approved the company's $4.8 billion merger with
UnitedHealth Group Inc. (NYSE:UNH) in a transaction that would
give the combined company a stronghold in the Northeast
(BestWire, July 9, 2004). Their merger was completed July 29,

Meanwhile, Norbeck said the Connecticut State Medical Society is
a plaintiff in the national class-action racketeering lawsuit
filed by about 700,000 physicians and other state medical
societies against managed-care companies Anthem Inc. (NYSE:ATH),
Coventry Health Care Inc. (NYSE:CVH), Health Net Inc.
(NYSE:HNT), Humana Inc. (NYSE:HUM), PacifiCare Health Systems
Inc. (NYSE:PHS), United Health and WellPoint Health Networks
Inc. (NYSE:WLP), currently in the U.S. District Court for the
Southern District of Florida in Miami. That lawsuit, under U.S.
District Judge Federico A. Moreno, alleges the companies
conspired to violate the federal civil Racketeer Influenced and
Corrupt Organizations Act, or RICO, by systematically denying,
delaying and diminishing payments for services the physicians
provided to the companies' members by using automated claims-
processing systems.

Late last month, the long-anticipated merger of Anthem and
WellPoint was completed, forming the new company WellPoint Inc.,
the nation's largest health insurance company based on
membership. Anthem, the corporate parent, was renamed WellPoint
Inc. (NYSE:WLP) in the $16.5 billion merger, which was made
official more than a year after the agreement first was

In the physicians' RICO suit, Moreno previously ruled that the
societies did have standing to sue, Norbeck said, noting that
those cases are scheduled to go to trial in September.

Cigna Corp. (NYSE:CI) and Aetna Inc. (NYSE:AET), which were
defendants in the RICO suits, have reached settlements, Norbeck
said. Aetna reached a $470 million settlement (BestWire, Oct. 1,
2004), while Cigna Health Care, a unit of Cigna Corp., reached a
$540 million settlement (BestWire, April 23, 2004).

HONEYWELL INTERNATIONAL: IL AG Files Suit V. Massac County Plant
Illinois Attorney General Lisa Madigan filed a lawsuit against a
Massac County chemical plant stemming from two releases in 2003
of alleged hazardous materials that sent several people to the
hospital and forced the evacuation of nearby homes.

The complaint, filed at the request of the Illinois
Environmental Protection Agency (IEPA), charges Honeywell
International, Inc., of Morristown, New Jersey, with air
pollution for the September and December 2003 incidents that
occurred at its plant on Route 45 North, Metropolis. The
Metropolis facility converts natural uranium ore to uranium
hexafluoride. The hexafluoride is used in manufacturing nuclear
reactor fuel for military and industrial electric utilities.

According to Madigan's complaint, a plume of hydrogen fluoride
(HF) drifted in a south-southwesterly direction during the early
morning of September 12, 2003, after alleged operator error
caused a release of antimony pentafluoride (SbF5) at the
Honeywell plant. HF can pose a threat to public health and is
formed when SbF5 reacts with moisture in the atmosphere. Non-
emergency personnel were evacuated, access to Honeywell was
restricted and some plant operations ceased during the release,
which lasted approximately 30 minutes.

According to the complaint, a more serious release occurred
December 22, 2003, when, again, human error allegedly led to a
release of uranium hexafluoride gas (UF6) and sent an HF cloud
in a north-northeasterly direction, which activated alarms
adjacent to Honeywell's property line. UF6 is a hazardous
material and HF is a regulated hazardous air pollutant that can
allegedly create a significant threat to public health. Reports
indicate at least one person was hospitalized for observation
and several others were evaluated for any ill-effects of
exposure to HF. Persons living near the plant were evacuated and
Route 45 was closed for two miles in both directions as a result
of the release.

"Honeywell subjected its workers and its neighbors not once, but
twice, to dangerous levels of hazardous materials," Madigan
said. "We are working to ensure that corrective measures have
been taken to minimize the possibility that these alleged
employee mistakes will occur again."

The suit, filed December 30, 2004, in Massac County Circuit
Court, also names Honeywell for alleged reporting violations
that occurred in November 2003 when a faulty gas meter failed to
properly monitor and record natural gas burned during
operations. Honeywell also was chargedwith land pollution, land
use violations and hazardous waste violations stemming from an
August 2000 IEPA inspection which revealed that potentially
hazardous waste sand was handled as general refuse and buried in
the facility's on-site landfill.

Madigan's suit seeks a civil penalty of $50,000 per violation
and an additional $10,000 for each day the violations continue.
Assistant Attorney General Jennifer Bonkowski is handling the
case for Madigan's Environmental Bureau.

ILLINOIS: Pres. Bush Visits Illinois, Calls For Limit On Suits
In his visit to Collinsville, Illinois, President George W. Bush
demanded congressional action this year to rein in "junk"
lawsuits against doctors and hospitals, arguing that the time
had come to impose federal restraints on a system traditionally
left to the states, the Los Angeles Times reports.

Taking his tort reform campaign to a southern Illinois county
that is known as a hotbed of civil litigation, President Bush
stated that the prospect of big jury awards in medical
malpractice cases was causing insurance rates to soar and
doctors to abandon their practices.

The president said, "What's happening all across this country is
that lawyers are filing baseless suits against hospitals and
doctors. ... They know the medical liability system is tilted in
their favor," Bush told a group of medical professionals and
business allies. Medical liability reform is a national issue,
and it requires a national solution."

President Bush's comments were the opening round in a
legislative battle between some of the country's most powerful
and well-financed interest groups. Doctors, hospitals, drug
makers and other manufacturers who want to limit litigation
expenses are teaming up against the trial attorneys who
represent plaintiffs in personal injury cases.

The president prodded lawmakers to take action this year to
address three facets of what the White House described as a
litigation crisis costing the U.S. economy more than $230
billion a year. The bills sought by his administration would
limit damages in malpractice cases, restrict class-action
lawsuits and curb asbestos-related litigation.

White House officials have even revealed that the president
wants the new Congress to tackle legal reform before taking up
other top domestic policy priorities such as Social Security
restructuring and tax code changes. Though facing uncertain odds
in the Senate, where many members are attorneys and where
Republicans still lack the votes to cut off Democrat
filibusters, it is expected to heed his call.

The malpractice legislation backed by the president would not
limit the size of damage awards for medical treatment and lost
wages, but it would place a $250,000 ceiling on awards for pain
and suffering and other non-economic damages. Such caps have
already been implemented in a number of states already. The U.S.
House has voted several times to impose a $250,000 federal cap
on damages, but the measures have stalled in the Senate.

The president and his allies contend that the prospect of
multimillion-dollar judgments is driving a crisis in malpractice
insurance rates.

However, opponents say caps disproportionately affect children,
seniors and stay-at-home mothers who have little or no lost
wages on which to base a malpractice award. According to a full-
page newspaper advertisement welcoming the president to southern
Illinois but urging him to reverse course on damage caps, "The
value of a life should not be equal to the value of a paycheck."
An advocacy group allied with trial lawyers had purchased the

Madison County and adjacent St. Clair County have been ranked by
tort reform advocates as the two worst places in the nation to
be sued, based on the number of lawsuits filed in recent years
and a history of pro-plaintiff rulings by judges this is why,
according to sources close to the president, his medical
liability campaign was launched in Illinois.

The president further stated during his visit to the state, the
medical liability system is "out of control." Addressing the
people of the controversial counties he said, "And you people in
this area and the doctors in this area understand what I'm
talking about." The president pointed out that nationwide, the
high cost of malpractice liability caused nearly half of all
hospitals to lose doctors or reduce services and that in Madison
and St. Clair counties, 160 physicians have retired or relocated
over the past two years.

However, the American Trial Lawyers Association challenged
President Bush's figures, citing statistics showing no loss of
physicians in Madison County, the state of Illinois or the
nation as a whole. Countering the White House spotlight on
distressed doctors and abandoned patients, opponents of
liability limits are offering up their anecdotes in the form of
patients and their families who say they were victims of medical

INTEGRATED CREDIT: MA AG Sends Out Checks in Consumer Suit Pact
Massachusetts Attorney General Tom Reilly began sending out
refund checks, ranging from $100 to $500, in late December 2004
to more than 1,400 Massachusetts consumers who paid up-front
fees to a Florida-based telemarketer in order to enroll in
credit counseling provided by a non-profit corporation.

The checks, totaling close to $400,000, stem from a settlement
AG Reilly reached earlier this year with Integrated Credit
Solutions (ICS), Inc., of Largo, Florida. The settlement
resolves allegations that ICS gave false and misleading
information about benefits and savings to lure consumers into
purchasing credit counseling services. AG Reilly's settlement,
filed in US District Court in May, requires ICS to pay more than
$600,000 in restitution to an estimated 2,600 Massachusetts
consumers who enrolled in credit counseling services following
ICS's sales pitch, which Reilly alleged violated federal
telemarketing laws as well as the Massachusetts Consumer
Protection Act.

"This company misled hundreds of people, many of whom were in
serious personal debt, into paying extra fees that they simply
were not told about up-front," AG Reilly said in a statement. "I
am pleased to announce that Massachusetts consumers are
receiving full refunds for those up-front fees."

ICS charged an up-front fee of hundreds of dollars - depending
on a consumer's total debt - in order to enroll in credit
counseling provided by a different, non-profit organization, but
failed to disclose that the up-front fee went only to ICS, a
for-profit telemarketer.  The restitution checks represent a
full refund of all up-front fees paid by Massachusetts

In 2001 and early 2002, ICS sent tens of thousands of pre-
recorded messages to answering machines in the Commonwealth,
promising lower interest rates and substantial savings for
consumers with credit card debt. Roughly 2,600 Massachusetts
citizens paid ICS up-front fees ranging between $200 and $500 to
enroll in "non-profit" credit counseling offered by a different
company.  ICS telemarketers claimed that consumers would save
significant amounts of money by using the help of a credit
counselor, AG Reilly alleged in his original complaint. Those
promised savings, however, were significantly diminished after
monthly charges of $35 or more and an up-front "enrollment" fee
of between $200 and $500 per consumer.

Under the terms of the settlement, ICS paid $400,000 to AG
Reilly's Office to pay refunds to Massachusetts consumers who
paid ICS to enroll in credit counseling services and have since
ended their dealings with the agency. For those consumers still
enrolled in credit counseling at the time of the settlement, ICS
will directly return the up-front fee when consumers terminate
services or finish their debt management program. The total
value of restitution is approximately $600,000, not including
the $50,000 civil penalty paid to the Commonwealth.

ICS is a subsidiary of Flagship Capital Services Corp., which is
also based in Florida and was named in the 2002 complaint.  ICS
solicited clients for non-profit credit counselors, including
Lighthouse Credit Foundation (LCF), a non-profit Florida-based
corporation established in 2000 by a former Flagship executive.

Assistant Attorney General Chris Barry-Smith of AG Reilly's
Consumer Protection and Antitrust Division handled this case,
and paralegal Lois Martin assisted in coordinating the
restitution payments.

J.D. BYRIDER: KY AG Stumbo Launches Consumer Protection Lawsuit
Kentucky Attorney General Greg Stumbo filed a Consumer
Protection lawsuit against national used car dealership
franchisor, J.D. Byrider, Inc. and the Louisville J.D. Byrider
franchise owned by James Maguire.  Both Maguire and his son, J.
Marc Maguire, are named as defendants along with several
corporations and limited liability companies (LLC's) owned and
controlled by the Maguires. The suit was filed today in
Jefferson Circuit Court.

The lawsuit alleges that the local franchise engaged in multiple
violations of the Kentucky Consumer Protection Act, as well as
the federal Magnusson-Moss Warranty Act and Truth in Lending Act
which harmed hundreds of consumers.  The allegations include the
violations of law, such as:

     (1) failing to repair or correct vehicle defects under an
         implied warranty of merchantability as required by law;

     (2) making unfair, false, misleading and deceptive
         statements that it had disclaimed all warranties when
         in fact it was prohibited from disclaiming such
         warranties as a matter of law;

     (3) refusing to recognize customers' right to revoke
         acceptance of their contract as required by law;

     (4) making false, misleading and deceptive statements that
         vehicles were "certified" or "inspected" when such was
         not the case;

     (5) charging consumers unlawful deductibles for warranty
         repair work;

     (6) requiring consumers to purchase credit life insurance
         and service contracts and failing to disclose these
         items as a cost of credit in violation of the federal
         Truth in Lending Act and state law; and

     (7) offering unlawful inducements to consumers in the form
         of referral sales "commissions" in violation of
         Kentucky statutory law.

The complaint also alleges that the business model of the
franchisor, utilized by the local franchise, unfairly makes
consumers vulnerable to abusive sales tactics and is unlawful.
The complaint alleges that the business model intentionally
targets credit-vulnerable consumers, discourages consumers from
choosing cars to purchase, hides or fails to disclose the
purchase price, requires detailed financial information and a
credit check before disclosing price, sells the "payment" to the
consumer, and keeps consumers at the site of the local franchise
for hours resulting in unfair contracts for consumers.

The complaint seeks restitution on behalf of consumers including
those who were required to pay deductibles for warranty repairs
that should have been performed at no cost due to the implied
warranty of merchantability and for consumers who attempted to
revoke acceptance of a substantially defective vehicle whose
attempts were wrongfully denied by the defendants. The complaint
alleges that the violations were willful and seeks civil
penalties of $2,000 per violation.

The Attorney General's Office has been engaged in negotiations
with the local franchise, which has voluntarily made some
positive changes in its operations addressing the practices
noted in the complaint. The Attorney General hopes to continue
to pursue a resolution of all outstanding issues including
consumer restitution during the course of the litigation.

For more information, please contact the Office of the Attorney
General, by Mail: State Capitol, Suite 118, Frankfort, Kentucky
40601, by Phone: (502) 696-5300

KGC CONSTRUCTION: IL AG Madigan Launches Consumer Fraud Suit
Illinois Attorney General Lisa Madigan filed a consumer fraud
suits lawsuit against Chicago company KGC Construction, Inc.,
alleging that consumers lost more than $350,000 to its team of
home repair con artists.

AG Madigan's office has received numerous consumer fraud
complaints alleging the company signed contracts for renovation
projects - including such large-scale projects as the conversion
of a one-family home into two apartment units and accepted
hundreds of thousands of dollars from its clients, then started
the projects with shoddy workmanship and failed to complete the

The lawsuit also names as defendants Elizabeth Hiero, a/k/a
Elizabeth Hiero Mulinski, individually and as president of KGC
Construction, and Mark Kowalkowski, an agent for the company.
The defendants have two business addresses: one in the 1700
block of W. 35 th St. and the other in the 5100 block of S.
Latrobe Ave., both in Chicago.

"KGC Construction posed as a legitimate construction company
capable of undertaking large renovation projects," AG Madigan
said. "Only after paying large sums of money did the consumers
realize the work they paid for was unacceptable and would likely
never be completed."

The defendants, who allegedly advertised their business in the
"Bridgeport News," are charged with multiple violations of the
Illinois Consumer Fraud and Deceptive Business Practices Act and
the Illinois Home Repair and Remodeling Act. The lawsuit alleges
the defendants failed to complete the home repair work for which
they were contracted and refused to refund the consumers' down
payments when requested.

Three separate consumer complaints received by Madigan's
Consumer Protection Division allege KGC Construction was
contracted to renovate and reconstruct residential buildings.
The consumers allegedly paid amounts of $215,000, $108,000 and
$37,000 for the projects, but KGC Construction failed to
complete the renovations on any of the projects. The company
allegedly failed to respond to requests from the consumers and
letters sent by Madigan's office requesting a refund. The
consumers were forced to pay for different contractors to
complete the renovations.

"The consumers defrauded by KGC Construction were undertaking a
complete remodeling of their homes. This type of project is a
huge investment and consumers cannot afford to pay for this
fraud," she said.

In addition, AG Madigan's lawsuit alleges the defendants did not
provide the consumers with the legally-required "Home Repair:
Know Your Consumer Rights" pamphlet nor, for those customers who
entered into contracts at their home, notification of the
consumer's three-day right to cancel.

AG Madigan's office served Hiero with a subpoena on August 19,
2004, requiring her to appear and provide documents at the
Attorney General's Office on August 30. Hiero did not appear and
has not contacted Madigan's office.

AG Madigan's lawsuit asks the court to prohibit the defendants
from engaging in the business of home repair and remodeling and
from further violating Illinois' consumer protection laws. In
addition, the lawsuit asks the court to assess a civil penalty
of $50,000 and additional penalties of $50,000 per violation
found to be committed with the intent to defraud. Finally, AG
Madigan's lawsuit asks the court to order the defendants to pay
restitution to the consumers.

Assistant Attorney General Monica Grubbs is handling the case
for AG Madigan's Consumer Fraud Bureau.

MESSERLI & KRAMER: Faces MN AG Lawsuit Over Collection Practices
Mid-Minnesota Legal Assistance and the Minnesota Attorney
General Mike Hatch's Office filed separate lawsuits against
Messerli & Kramer ("M&K"), a Twin Cities law firm, alleging that
M&K's collection attorneys used unlawful and bad faith tactics
to collect debts from Minnesota consumers.

"This firm specializes in obtaining default judgments, often
against the poor, sick, and disabled," said Tim Thompson,
Litigation Director at Mid-Minnesota Legal Assistance. "That's
not illegal. But what is illegal is adding to the misery by
piling their own attorney fees on to these judgments without
following Minnesota law. They even bill for time they haven't
spent on the case."

"It is wrong for collection attorneys to use their knowledge of
the system to make unlawful gains," said Attorney General Hatch.
"Garnishing wages such as Social Security, veterans' benefits,
or other exempted incomes, when the law states otherwise, is
inappropriate and in bad faith."

Both lawsuits allege that M&K improperly adds unearned, or
"future," attorneys' fees to the debts owed by consumers when
M&K obtains default judgments, adding hundreds or thousands of
dollars to the amount of the bill. The lawsuits allege that M&K
files boilerplate affidavits in Minnesota district courts
seeking attorneys' fees for work that has not yet been
performed. M&K's boilerplate affidavits request 15% of the
principal balance (up to $3,000), which includes attorneys' fees
that it estimates it will incur in the future. The lawsuits
allege that M&K's practices violate Minnesota law, which
outlines the requirements to obtain an award of attorneys' fees
in connection with a default judgment. Minnesota statutes do not
include awards for unearned or "future" work.

The Attorney General's lawsuit also alleges that M&K's
collection attorneys have garnished in bad faith accounts of
vulnerable consumers who live on limited or fixed incomes. Under
Minnesota law, creditors can collect debts by garnishing
debtors' bank accounts. Minnesota law, however, provides that
certain earnings are exempt from garnishment, including income
from Social Security, veterans' benefits, disability, or other
protected sources. M&K's collection attorneys attach bank
accounts, garnishing exempted funds, thereby shifting the burden
to the consumer to file a notice of exemption claiming that the
funds are exempt from garnishment. The Attorney General's
lawsuit alleges that M&K used the garnishment process in bad
faith. Among other things, instead of releasing levies where
appropriate, the lawsuit alleges that M&K's collection attorneys
objected to consumers' exemption claims, often without a good
faith basis for doing so, thereby forcing consumers to file
court documents to prove that the funds are exempt. The lawsuit
alleges that, in some cases where consumers requested a hearing
to determine the validity of an exemption, M&K's attorneys
either failed to show up, conceded the case at the hearing, or a
court found that the funds were, in fact, exempt from
garnishment. Consumers in such cases lost access to their money
for weeks because their accounts were frozen by M&K's initial
levy. The Attorney General's lawsuit alleges that, in some
instances, M&K garnished consumers' income even after the
consumer had shown a valid exemption from garnishment.

This is not the first time M&K's collection attorneys have been
involved in disputes over aggressive debt collection tactics.
For instance, a collections case filed in Anoka County District
Court by M&K was dismissed when the judge found that the default
judgment was "entered in error and as a result of the false
statements contained in the affidavit of plaintiff's attorney
(M&K)." Last month, the Minnesota Court of Appeals noted the
"gravity" of actions by a M&K collection attorney who falsely
told the court that a Minnesota consumer had never denied that
he owed a debt to the credit card company represented by M&K.

Both lawsuits were filed in Ramsey County District Court.
Messerli & Kramer's collections operations are located at 3033
Campus Drive, Suite 250, Plymouth, Minnesota 55441. M&K's web
site states that it "is one of the largest collection law firms
in the country."

For more details, contact the Office of Minnesota Attorney
General Mike Hatch by Mail: 1400 NCL Tower, 445 Minnesota Street
St. Paul, MN 55101 or by Phone:  (651) 296-3353, 1-800-657-3787,
TTY: (651) 297-7206, TTY: 1-800-366-4812

METABOLIFE INTERNATIONAL: Seeks Settlement of Ephedra Litigation
San Diego-based Metabolife International is seeking a national
settlement with U.S. consumers who allege they were injured by
the company's now-defunct ephedra diet pill, the North County
Times reports.

Citing a "litigation onslaught" that threatens to financially
bury it, the privately held company has asked a federal judge in
New York to approve the proposed multimillion-dollar class-
action settlement, according to The San Diego Union-Tribune.

The newspaper reported that if the plan is approved, consumers
represented in about 300 personal injury lawsuits in federal and
state courts could each receive up to $1.05 million although
they could also opt out and pursue separate court cases. The
settlement would also cover future claims by injured consumers
who have not filed lawsuits.

The Metabolife 356 pill, which was used by bodybuilders for
increasing stamina and dieters for shedding pounds, generated
hundreds of millions of dollars in revenues after its 1995
launch. However, the pill, a combination of caffeine and the
herbal stimulant ephedra, has also been linked to strokes, heart
attacks and, in some cases death. Last year, the Food and Drug
Administration banned all dietary supplements containing

MINNESOTA: City of St. Paul Sued Over Vendor Outreach Program
A class-action lawsuit has been initiated against the City of
St. Paul alleging continued race-discrimination regarding
economic development opportunities under its vendor outreach
program, the Minnesota Spokesman-Recorder reports.

The suit, which has been filed with the United States District
Court, 3rd Division, alleges that the city has failed to
properly enforce Chapter 84, its charter for guaranteeing equal
access for doing business with the city.

Among the defendants named are: Mayor Randy Kelly, Deputy Mayor
Dennis Flaherty, current Director of Planning and Economic
Development Susan Kimberly, former Director of Planning and
Economic Development Martha Fuller, and Linda Camp, who
currently oversees Chapter 84, the city's vendor outreach

The plaintiffs seek relief from what they say are unlawful
practices that deny minority-owned developers opportunities to
contract with the City.

According to Steven L. Smith, an attorney for the plaintiff,
Cornerstone Community Realty & Mortgage Services, the suit
challenges St. Paul and the Kelly Administration to comply with
its vendor outreach requirements. Chapter 84 is supposed to
insure that bids are solicited from minority-owned and women-
owned enterprises, and that reasonable goals are set in reaching
them. Mr. Smith explains, "Chapter 84, if followed, will
significantly increase the likelihood that women- and minority-
owned businesses are getting a piece of the economic pie."

OHSL CORPORATION: Dismissed Oak Hills Case Re-filed in DE Court
A corporate fraud lawsuit that was dismissed by a federal judge
in Cincinnati two months ago has been re-filed in a state court
in Delaware, the Cincinnati Enquirer reports.

The class action civil complaint filed in the Delaware Court of
Chancery in Wilmington restates the claim that OHSL Financial
Corporation, the parent of the defunct Oak Hills Savings & Loan
and its directors committed fraud and breached their fiduciary
duty to shareholders in approving the thrift's sale to Provident
Financial Group for $57 million in 1999.

Chief U.S. District Judge Sandra Beckwith had dismissed the
original suit, which was filed in 2000 in U.S. District Court in
Cincinnati, last November 5 in its pre-trial stages. In her
dismissal, she ruled that the suing shareholders, represented by
Cincinnati lawyer Mike Brautigam, had failed to prove that the
banks, directors and their lawyers intended to deceive or
defraud anyone.

Mr. Brautigam has appealed the dismissal. Meanwhile, he hopes
the Delaware filing will revive the dismissed claims that were
based on Ohio law. He told the Cincinnati Enquirer, "In
dismissing the case, the court declined to exercise jurisdiction
over the state claims, so it's appropriate to file in Delaware
because OHSL was a Delaware corporation. The Delaware courts
have expertise in this area, and we're confident they're going
to come to the right decision."

The Chancery Court specializes in corporate matters. Since there
are thousands and thousands of Delaware corporations, the court
is the forum to resolve disputes involving the internal affairs
of these companies, through which much of the world's commercial
affairs are conducted.

James Greer of Dayton, one of the lawyers defending Oak Hills
and its directors, said he couldn't comment on specifics of the
new filing because he hadn't seen it, but he did tell the
Cincinnati Enquirer, "All I can tell you is we'll continue to
fight the allegations as we have been doing for quite some time
now." Provident itself has since been acquired by National City

PENNSYLVANIA: Suit Filed V. Kerr-McGee, T.P For Causing Ailments
About 4,000 people, who were listed in 24 complaints filed
recently in Luzerne County Court, are pursuing a class-action
lawsuit against the Kerr-McGee Corporation and the T.P.
Corporation, claiming the factories caused life-threatening
ailments for employees and neighbors, the Scranton Times Tribune

According to the complaints, plaintiffs who lived near or worked
at Kerr-McGee's Avoca plant and T.P. Corporation in Dureya
developed skin, liver and lung cancer, asthma, leukemia, myeloma
and non-Hodgkin's lymphoma due to the release of hazardous
chemicals used at the facilities.

Kerr-McGee, a global energy and inorganic chemical company based
in Oklahoma City, operated in Avoca from 1956 until the plant
closed in 1996. The facility preserved wooden railroad ties and
utility poles. Among the chemicals used at Kerr-McGee were
creosote, arsenic, benzene and chromium, according to the

The complaint states that the Kerr-McGee facility had several
sources of air emissions, including two cylinders that produced
large amounts of emissions when they were opened to remove
treated wood at the end of the treatment cycle. Other sources of
emissions of hazardous chemicals included the evaporation of
treated wood, a vacuum system used to reduce the pressure in the
treatment cylinder, a chemical tank designed to capture unused
chemicals, boilers that were used during the preservation
operations and wastewater, the complaint further states.

On the other hand, T.P. Corporation, which could not be reached
for comment uses six printers to apply solvent-based printings
and impressions to various fabrics. Prior to 1991, the company's
primary solvent usage included acetone, xylene, ethyl benzene,
mineral spirits, ethanol, butyl acetate, toluene and several
other chemicals.

In 1991, a thermal oxidizer was installed to destroy solvent
emissions prior to discharge into the atmosphere, but when the
thermal oxidizer began to operate, the oxidizer stack became a
source of unburned solvent emissions, as well as a source of
carbon monoxide, oxides of nitrogen, and polynuclear aromatic
hydrocarbon emissions, according to the complaint.

Mark Carmon, spokesman for the state's Department of
Environmental Protection told the Scranton Times Tribune that
Kerr-McGee has submitted a cleanup plan for its Avoca site. He
also adds that once Kerr-McGee submits its final cleanup report,
DEP will inspect the site to determine if the company can be
released from liability.

SAGEE USA: Settles FTC Suit Over Unsubstantiated Health Claims
A company that heavily advertised an herbal dietary supplement
called "Sagee" to the Chinese-language and Vietnamese-language
communities settled Federal Trade Commission charges of making
false and unsubstantiated claims for the product.  The ads
claimed that Sagee can improve brain health and revitalize and
rejuvenate the brain, as well as alleviate or treat a number of
serious, chronic brain-related diseases.

Under the terms of the settlement announced today, the
defendants, Sagee U.S.A. Group, Inc., and its President, Xiao
Hua Li, are prohibited from making any health benefits,
performance, or efficacy claims for any product that purports to
repair damaged brain cells; improve memory or concentration;
slow down the brain's aging process; and treat or alleviate
conditions such as insomnia, migraine headaches, or cerebral
embolism, unless the defendants have reliable scientific
evidence to substantiate their claims.

"The FTC is committed to ensuring that supplement sellers make
only truthful claims backed by scientific evidence - no matter
what language they advertise in," said Lydia Parnes, Acting
Director of the FTC's Bureau of Consumer Protection in a

According to the complaint filed in federal court, Sagee
purported to treat or alleviate such conditions as insomnia,
migraine headaches, neuroticism, schizophrenia, tinnitus,
autism, Alzheimer's disease, cerebral embolism, cerebral
hemorrhage, epilepsy, Parkinson's disease, senile dementia, and
stroke. In addition, the defendants' ads contained statements
that Sagee repairs brain cells, improves memory, concentration,
attentiveness, and response times, slows down the brain's aging
process, and relieves aging-related conditions of the brain. The
defendants advertised and sold Sagee through Chinese-language
advertising on radio and television, in newspaper ads, and on
the Internet. Some ads also appeared in Vietnamese and English.
The complaint alleges that the defendants made unsubstantiated
efficacy claims for Sagee and falsely claimed that clinical
studies support their therapeutic claims for the product.

To settle the charges, the proposed stipulated final judgment
and order prohibits the defendants from making unsubstantiated
efficacy claims for any dietary supplement, food, drug, device,
or service. It also prohibits the defendants from
misrepresenting through endorsements, the existence, contents,
validity, results, conclusions, or interpretations of any test,
study, or research.

The order requires the defendants to pay $10,000 in redress and
contains a $1.38 million avalanche clause that would become due
if the court finds that the defendants misrepresented their
financial condition. In addition, the order requires the
company, based in City of Industry, California, to send a notice
to distributors containing the terms of the stipulated final
judgment and warning them that if they fail to have their ads
approved in advance, or make any claims prohibited by the order,
the company will not ship further products to them. Finally, the
order contains various record-keeping provisions to assist the
FTC in monitoring the defendants' compliance.

The Commission vote authorizing staff to file the complaint and
the stipulated final judgment and order was 5-0. The complaint
and the stipulated final judgment and order were filed in the
U.S. District Court for the Central District of California, on
December 29, 2004. The stipulated final judgment and order
requires the court's approval.

For more details, contact the FTC's Consumer Response Center, by
Mail: Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C.
20580 or visit the website: http://www.ftc.gov. Also contact
Brenda Mack, Office of Public Affairs by Phone: 202-326-2182 or
Janice Charter, FTC Western Region - San Francisco by Phone:

TV AZTECA: CEO Ricardo B. Salinas Says SEC Accusations False
In response to the securities fraud charges being leveled by the
Securities and Exchange Commission, Ricardo B. Salinas, the
founder, chairman and majority shareholder of TV Azteca, issued
a statement claiming, "The SEC accusations are false, in bad
faith and discriminatory," World Screen News reports.

As previously reported in the January 6, 2005 edition of the
Class Action Reporter, in a U.S. Federal Court, the SEC has
filed charges against TV Azteca SA de CV, Mexico's second
biggest television broadcaster, Mr. Salinas and current board
member and former CEO Pedro Padilla Longoria. The SEC alleges
that the parties named violated federal securities laws in
connection with a complex debt deal involving Unefon, Nortel and
Codisco. The SEC claims that Mr. Salinas and two other
executives sought to conceal Mr. Salinas' role in the deal, in
which he netted a profit of some $109 million.

Still TV Azteca maintains that, over the past year, it has been
cooperating with the SEC and has received several settlement
offers from the regulator, none of which it wanted to accept.

In his press statement, Mr. Salinas said, "Principles are not
negotiable. We could have settled for money, but this is not
about money, it is about standing up for what you believe to be
right. The transactions discussed in the SEC press release
benefited Unefon, TV Azteca and their shareholders and I stand
behind them. The SEC accusations are false, in bad faith and
discriminatory. We will prevail because we acted correctly."

Furthermore, he states, "It's absurd for the SEC to use a
Mexican company and Mexican citizens to try to impose U.S.
regulations in an extraterritorial manner, unilaterally ignoring
international laws and the Mexican legal framework. In my view
they are trying to politically compensate their deficiencies in
supervising U.S. companies in the past. It is these
irresponsible and arbitrary SEC actions, not the Unefon debt
transactions, which are adversely affecting both minority and
majority shareholders."

The SEC's action is seeking fines, repayment of ill-gotten gains
and injunctions against future violations. According to local
reports, the fine could be anywhere from $4.5 million and $8
million, and class action lawsuits could cost the company
anywhere from $1.2 million to $10.2 million.

UNITED STATES: Chamber of Commerce Hails Action on S. 2062 Bill
The United States Chamber of Commerce Institute for Legal Reform
welcomed Senate Majority Leader Bill Frist's and House Speaker
Dennis Hastert's announcements that they are moving forward on
the Class Action Fairness Act, CSNnews.com reports.

"We are pleased by Senator Frist's announcement that he intends
to bring the Class Action Fairness Act to the Senate floor in
early February," said Stanton D. Anderson, executive vice
president and chief legal officer of the U.S. Chamber of
Commerce, according to CSNnews.com.  "We are also heartened by
his public support for asbestos litigation and medical liability

Lisa Rickard, ILR president, also urged Congress to pass the
Class Action Fairness Act, an asbestos litigation reform bill,
and medical liability reform. "It's good for America's
employers, workers and families," Mr. Rickard told CSNnews.com.
"We must understand that there is a huge cost of abusive
lawsuits on jobs and our economy."

A recent study conducted by the Institute found that the system
is costing small businesses $88 billion every year.  The
Institute further asserts that the system drained more than $233
billion from the U.S. economy and cost the average American
family of four more than $3,200 a year in higher prices,
insurance rates and health care costs, making the system the
most expensive in the world.  During the past decade alone,
class action lawsuit filings rose more than 300 percent in
federal courts and more than 1,000 percent in state courts, ILR
says.  The group also says asbestos litigation has driving more
than 70 companies into bankruptcy, costing as many as 60,000
Americans their jobs.

"Now is the time for Congress to pass legal reform legislation
that will bring balance to America's legal system by ending the
lawsuit abuse that cripples our employers and hits the
pocketbooks of America's working families," said Anderson,
according to CSNnews.com.

WORLDCOM INC.: Ten Former Directors Reach $54M Suit Settlement
To settle their portion of a class-action lawsuit brought by
bondholders and shareholders, ten former outside directors for
the former WorldCom Inc. have agreed in principal to pay $54
million, including $18 million personally, according to a report
published by the Wall Street Journal, citing unnamed sources,
the CBS MarketWatch reports.

According to the report, the remaining $36 million would be paid
by the directors' liability insurers and that under the accord
the $18 million to be paid by the former directors represents
about 20 percent of their combined personal net worth, excluding
their primary residences, retirement accounts and certain joint
marital assets.

The Journal also reported that some of the former directors
would pay more than others, though the amounts have yet to be
determined and that the formal agreement is to be signed and
presented for approval to a federal judge in New York on
Thursday. None of the 10 former directors was a participant in
the accounting machinations of the WorldCom fraud, which
overstated earnings by about $11 billion, and all suffered large
losses as a result of the company's collapse, the Journal
further reported.

In July 2002, MCI (MCIP: news, chart, profile) then known as
WorldCom, filed the largest bankruptcy in U.S. history. MCI
emerged from bankruptcy protection in April. To date, the SEC
hasn't brought any disciplinary actions against WorldCom's
former outside directors, the Journal reported.

The report also revealed that this latest WorldCom settlement
includes all but two of WorldCom's former outside directors:
Bert Roberts and Francesco Galesi, who remain defendants in the
lawsuit. The lawsuit's lead plaintiff is the New York State
Common Retirement Fund.

The 10 settling former outside directors, according to the
reports are James C. Allen, Judith Areen, Carl J. Aycock, Max E.
Bobbit, Clifford L. Alexander, Stiles A. Kellett Jr., Gordon S.
Macklin, John A. Porter, Lawrence C. Tucker and the estate of
John W. Sidgmore, who died last year.

Citing a person familiar with the matter, the Journal reported
that the $36 million to be paid by their insurers wouldn't fully
tap out the company's director-liability insurance coverage.
But, regardless of how much the insurers would pay, New York
State Comptroller Alan Hevesi, the New York retirement fund's
sole trustee, personally has insisted that the directors each
personally pay a significant portion of the settlement proceeds.

The Journal report detailed that in their most recent amended
complaint, the New York fund wrote that the "WorldCom's board of
directors was utterly derelict in fulfilling the most basic
functions of a true board."

Under the agreement-in-principle, the settling directors are
expected to deny wrongdoing and state they are settling the case
to eliminate the uncertainties and expense of further
litigation, the report concludes.

                         Asbestos Alert

ASBESTOS LITIGATION: Tyco Int'l, Subsidiaries Fight 14,500 Cases
Tyco International Ltd. (NYSE: TYC), a diversified manufacturing
and service company, reported that at the end of the third
quarter, the total asbestos liability cases reached 14,500
brought against the Company and its subsidiaries. Most of the
cases involve product liability claims, based principally on
allegations of past distribution of heat-resistant industrial
products incorporating asbestos or the past distribution of
industrial valves that incorporated asbestos-containing gaskets
or packing. Each case typically names between dozens to hundreds
of corporate defendants.

The majority of these cases have been filed against subsidiaries
in Healthcare and Engineered Products and Services. A limited
number of the cases allege premises liability, based on claims
that individuals were exposed to asbestos while on a
subsidiary's property.

Tyco's involvement in asbestos cases has been limited because
its subsidiaries did not mine or produce asbestos. Furthermore,
in its experience, a large percentage of these claims were never
substantiated and have been dismissed by the courts. The Company
will continue to vigorously defend these lawsuits. It asserts
further that it has not suffered an adverse verdict in a trial
court proceeding related to asbestos claims. When appropriate,
the Company says that it settles claims. However, it reports
that the total amount paid to date to settle and defend all
asbestos claims has been immaterial.

Like many other companies, Tyco and some of its subsidiaries are
named as defendants in personal injury lawsuits based on alleged
exposure to asbestos-containing materials. Consistent with the
national trend of increased asbestos-related litigation, the
Company has observed an increase in the number of these lawsuits
in the past several years.

The Company believes that it and its subsidiaries have
substantial indemnification protection and insurance coverage,
subject to applicable deductibles, with respect to asbestos
claims. These indemnitors and the relevant carriers typically
have been honoring their duty to defend and indemnify. The
Company believes that it has valid defenses to these claims and
intends to continue to defend them vigorously.

Additionally, based on the Company's historical experience in
asbestos litigation and an analysis of the Company's current
cases, it believes that it has adequate amounts recorded for
potential settlements and adverse judgments in asbestos-related

The manufacturing conglomerate, whose Fire and Security unit is
the world leader in security and fire-protection systems, has
been reorganized into five main business segments: Fire and
Security; Electronics; Healthcare; Engineered Products and
Services; and Plastics & Adhesives. Tyco is domiciled in Bermuda
but run primarily from Princeton, New Jersey.

ASBESTOS LITIGATION: ATRA Identifies Top 9 "Judicial Hellholes"
A report released recently by the American Tort Reform
Association identifies the nation's nine "judicial hellholes,"
defined as places that have a disproportionately harmful impact
on civil litigation.

For the second year in a row, Madison County, Illinois, topped
ATRA's list of the worst courts in America and, for the first
time, neighboring county, St. Clair, made the list, ranking as
the country's second worst jurisdiction. Madison and St. Clair
are home to a multitude of national class-action lawsuits,
including those related to ongoing asbestos litigation.

"When it comes to the big business of trial lawyering, again
there is no better place to set up shop than Madison County,"
according to the ATRA report.

Sherman Joyce, President of ATRA, outlined the case against the
courts in the Metro East region of Illinois, "Lawsuit abuse has
devastated the region's health-care system."

Many political observers believe that Judge Lloyd Karmeier's
election to the Illinois Supreme Court and the backlash against
trial lawyers, particularly because of concern about the quality
of health care available to southern Illinois residents, will
keep this issue of lawsuit abuse at the top of the legislative
agenda for both political parties when the state's General
Assembly convenes for their spring session later next month.

"Judicial hellholes are a nightmare for businesses and
consumers, but a dream come true for trial lawyers," said John
Marlow, AIA assistant vice president, Southwest region. "The
deck is stacked in their favor in these destructive
jurisdictions, through favorable rulings and verdicts that
encourage frivolous lawsuits and unfair financial windfalls."

ATRA also identified Orleans Parish, Louisiana on the list. Mr.
Marlow said, "The results of this report should serve as a wake-
up call to Louisiana's elected officials-states with
jurisdictions designated as judicial hellholes often experience
harmful economic side effects that are very damaging to
businesses and consumers, including higher costs of goods and
services, higher insurance premiums, reduced wages, loss of
employment opportunities and reduced access to health care."

Mr. Marlow also said that the good news for Louisiana is that
out-of-balance tort systems can be fixed. He cited the case in
Mississippi where after years in the spotlight as a hellhole,
the legislature this year passed comprehensive civil justice
reform. Insurers and other businesses have brought additional
jobs and investment to the state.

"AIA will be working with our civil justice coalition partners
to bring this same success to Louisiana during next year's
legislative session," assured Mr. Marlow.

ASBESTOS LITIGATION: Armstrong Creditors Await January Ruling
Armstrong Holdings, Inc.'s Chapter 11 bankruptcy proceedings
come to a crossroads as Judge Eduardo C. Robreno of the U.S.
District Court for the District of Delaware, considered
objections to confirmation of the Company's plan of

The objections were offered by the Official Committee of
Unsecured Creditors and opposed by the Company and the Asbestos
Claimants Committee and Future Claimants' Representative. The
judge indicated he would probably issue a ruling on the
objections to the plan of reorganization in January.

"I shall rule on the matter very promptly, but it'll be a couple
weeks. I'll get back to you early in the [new] year," said
federal Judge Robreno, at the conclusion of a 4-hour hearing.

The hearing aired the creditors' objections to Armstrong's
reorganization plan and to the actions of a bankruptcy judge who
recommended to the federal court that the plan be approved. But
Armstrong called the objections a "totally transparent" tactic
to stall the process in hopes that Congress will create a
national system to pay asbestos claims, freeing more Armstrong
money for creditors.

Judge Robreno provided no hint of what he's likely to do. The
first possibility includes dumping Armstrong's plan and forcing
the Company to develop a new one. This would be a huge blow,
given that Armstrong already has spent four years and millions
of dollars on reorganizing.

It could also be that he might decide the bankruptcy judge erred
and order further hearings to be held on the existing plan or he
might rule the bankruptcy judge's actions were proper and the
plan is fine as is, allowing Armstrong to emerge from

Most bankruptcy plans can get final approval from a bankruptcy
judge. But Armstrong's plan needs the approval of a federal
judge such as Judge Robreno because of the way it handles
asbestos-injury claims.

Armstrong filed for bankruptcy in December 2000 to resolve
nearly 200,000 of those asbestos-injury claims. In November
2002, Armstrong unveiled its reorganization plan. The plan,
revised in May 2003, would set aside US$1.8 billion to pay
asbestos claimants various sums, depending on their
circumstances. Unsecured creditors would split US$982 million,
giving them 59.5 percent of what they're owed.

The plan was negotiated with, and supported by, the asbestos
claimants and unsecured creditors. But the creditors' support
eroded in fall 2003 after the FAIR Act, a bill to create a
national system for paying asbestos claims, was proposed in

Under the FAIR Act, former asbestos companies like Armstrong and
the insurers would finance a national trust fund that would
compensate asbestos claimants for their sicknesses. Armstrong
might contribute as little as US$520 million to a national
system, rather than the US$1.8 billion it would set aside to pay
asbestos claims under its own plan.

That difference would allow unsecured creditors to be repaid in
full, rather than get 59.5 percent.

Armstrong Holdings, Inc. is the parent Company of Armstrong
World Industries, Inc., a global leader in the design and
manufacture of flooring, ceilings and cabinets. In 2003,
Armstrong's net sales totaled more than US$3 billion. Based in
Lancaster, Pa., Armstrong has 44 plants in 12 countries and
about 15,500 employees worldwide.

ASBESTOS LITIGATION: Advisers Explain How Work Tax Relief Works
Martin Hoyle, regional head of building consultancy at property
advisers GVA Grimley in Bristol, says that although tax relief
of 150 percent was introduced in 2001, many companies still do
not realize they can benefit. He said, "Recent national research
has revealed that 37 percent of businesses have not heard of the
new asbestos regulations."

The Control of Asbestos at Work regulations, which came into
force in full earlier this year, state that anyone responsible
for maintaining and repairing all or part of a property, such as
the owner or occupier, has a duty to find out whether the
building contains asbestos.

Mr. Hoyle said that detecting asbestos might then result in
having to treat or remove asbestos, which can result in
significant financial outlay.

Ian Jones, tax partner at KPMG's Bristol office, said that in
the past many companies have struggled to obtain tax relief for
the unforeseen costs involved in dealing with asbestos. However,
this situation has now changed.

He said, "In effect, that means that the legislation treats
every GBP100 spent as if the cost had been GBP150, with the
effective rate of tax relief being 45 percent instead of 30
percent, for large companies."

ASBESTOS LITIGATION: ArvinMeritor, Maremont Meets Injury Claims
ArvinMeritor Inc. (NYSE: ARM), recently submitted a filing to
the Securities and Exchange Commission, stating that Maremont
Corporation, its subsidiary, is a co-defendant with many other
companies in suits brought by individuals claiming personal
injuries as a result of exposure to asbestos-containing

Maremont manufactured friction products containing asbestos from
1953 through 1977, when it sold its friction product business.
Arvin acquired Maremont in 1986.

Maremont's potential liabilities for asbestos-related claims can
be grouped into three categories.

The first group includes unbilled committed settlements entered
into by the Center for Claims Resolution. Maremont participated
in the CCR and shared with other members in the payment of
defense and indemnity costs for asbestos-related claims. The CCR
handled the resolution and processing of asbestos claims on
behalf of its members until February 2001, when it was
reorganized and discontinued negotiating shared settlements.
Billings to insurance companies related to committed settlements
were US$1 million in fiscal year 2004.

Pending claims compose the second group. Upon dissolution of the
CCR in February 2001, Maremont began handling asbestos-related
claims through its own defense counsel. Maremont had about
74,000 and 63,000 pending asbestos-related claims at September
30, 2004 and 2003, respectively.

Although the Company expects legal defense costs to continue at
higher levels than when it participated in the CCR, it believes
its litigation strategy has reduced the average indemnity cost
per claim. In addition, although Maremont has been named in
these cases, in the cases where actual injury has been alleged,
very few claimants have established that a Maremont product
caused their injuries. Billings to insurance companies for
indemnity and defense costs of resolved cases were US$12 million
in fiscal year 2004.

The third group constitutes the shortfall. Several former
members of the CCR have filed for bankruptcy protection, and
these members have failed, or may fail, to pay certain financial
obligations with respect to settlements that were reached while
they were CCR members. Maremont is subject to claims for payment
of a portion of these defaulted member shares. In an effort to
resolve the affected settlements, it has entered into
negotiations with plaintiffs' attorneys, and an estimate of its
obligation for the shortfall is included in the total asbestos-
related reserves. Payments by the Company related to shortfall
and other were US$4 million in fiscal year 2004.

At September 30, 2004, Maremont had established reserves of
US$74 million relating to these potential asbestos-related
liabilities and corresponding asbestos-related recoveries of
US$72 million.

Maremont is a division of ArvinMeritor Light Vehicle
Aftermarket, a global automotive aftermarket Company providing
exhaust, filter, and ride control products to its customers.
ArvinMeritor Light Vehicle Aftermarket is headquartered in
Brentwood, TN and is a division of ArvinMeritor Inc.

ASBESTOS LITIGATION: ArvinMeritor Faces Rockwell Product Claims
ArvinMeritor Inc. (NYSE: ARM), a leading provider of products
and services to the automotive industry, reports in its latest
annual report filed with the Securities and Exchange Commission
that along with hundreds of other companies, it has been named
as a defendant in lawsuits alleging personal injury as a result
of exposure to asbestos used in certain components of Rockwell
products many years ago.

Liability for these claims was transferred to the Company at the
time of the spin-off of the automotive business to Meritor from
Rockwell in 1997. Currently there are tens of thousands of
claimants in lawsuits that name ArvinMeritor, together with
hundreds of other companies, as defendants.

The great bulk of the complaints, however, do not identify any
of Rockwell's products or specify which of the claimants, if
any, were exposed to asbestos attributable to Rockwell's
products, and past experience has shown that the vast majority
of the claimants will never identify any of Rockwell's products.

For those claimants who do show that they worked with Rockwell's
products, the Company believes it has meritorious defenses, in
substantial part due to the integrity of the products involved,
the encapsulated nature of any asbestos-containing components,
and the lack of any impairing medical condition on the part of
many claimants. Historically, ArvinMeritor has been dismissed
from the vast majority of these claims with no payment to

Rockwell maintained insurance coverage that covers indemnity and
defense costs, over and above self-insurance retentions, for
most of these claims. The Company has initiated claims against
these carriers to enforce the insurance policies.

ArvinMeritor has not established reserves for pending claims and
corresponding recoveries for Rockwell-legacy asbestos-related
claims, and defense and indemnity costs related to these claims
are expensed as incurred. Reserves have not been established
because management cannot reasonably estimate the ultimate
liabilities for these costs, primarily because it does not have
a sufficient history of claims settlement and defense costs from
which to develop reliable assumptions.

Rockwell was not a member of the CCR and handled its asbestos-
related claims using its own litigation counsel. As a result,
the Company does not have any additional potential liabilities
for committed CCR settlements or shortfall in connection with
the Rockwell-legacy cases.

ASBESTOS LITIGATION: FiberMark Says Debtors Named in 11 Lawsuits
FiberMark, Inc. (OTC: FMKIQ), a maker of specialty fiber-based
materials, reported in the latest filing to the Securities and
Exchange Commission that over the last several years, certain of
its debtors or its predecessors have been named as a defendant
in a large number of asbestos lawsuits, including several class
action lawsuits.

It is the debtors' position that they were named in error, and
the vast majority of such lawsuits have been dismissed on that
basis. The debtors have never been found liable on any asbestos-
related claim. As of this date, there are 11 lawsuits still
pending against certain of the debtors, as to which proofs of
claim have been filed in the Chapter 11 Case. The debtors intend
to seek the disallowance of such proofs of claim.

Based upon the Company's experience, it expects that the future
cost of complying with existing environmental laws, and the
Company's liability for known environmental claims under those
laws, will not have a material adverse effect on the Company's
financial condition or results of operation. However, new
information, changes in environmental laws or how they are
interpreted, or more vigorous enforcement by regulatory
authorities may give rise to additional expenditures or
liabilities that could be material to the Company's financial
condition and results of operations.

The Company's 11 U.S. and European facilities produce products
from a variety of natural and man-made materials - cotton, metal
and synthetic fibers, wood pulp, and recovered paper - for a
broad range of applications. FiberMark has been a publicly
traded Company since 1993, currently quoted on the OTC Bulletin

ASBESTOS LITIGATION: BlueLinx Notes Unresolved Claims Facing GP
BlueLinx Holdings Inc. (NYSE: BXC), the country's largest
supplier of construction products, reported in its most recent
filing to the Securities and Exchange Commission that Georgia-
Pacific (NYSE: GP) is a defendant in suits brought in various
courts around the nation by plaintiffs who allege that they have
suffered personal injury as a result of exposure to products
containing asbestos.

Originally a lumber outlet division owned by paper and building
products giant Georgia-Pacific Corp., BlueLinx further states
that these suits allege a variety of lung and other diseases
based on alleged exposure to products previously manufactured by
Georgia-Pacific. No reserves or costs of Georgia-Pacific's
asbestos claims have been assigned or allocated to the division.

Based on Georgia-Pacific's public disclosure in its Quarterly
Report on Form 10-Q for the quarter ended October 2, 2004, there
were 59,800 unresolved asbestos claims against Georgia-Pacific
at the end of the first nine months of 2004. Although the terms
of the asset purchase agreement provide that Georgia-Pacific
will indemnify BlueLinx against all obligations and liabilities
arising out of, relating to or otherwise in any way in respect
of any product liability claims (including, without limitation,
claims, obligations or liabilities relating to the presence or
alleged presence of asbestos-containing materials) with respect
to products purchased, sold, marketed, stored, delivered,
distributed or transported by Georgia-Pacific and its
affiliates, including the division prior to the acquisition, the
Company believes that circumstances may arise under which
asbestos-related claims against Georgia-Pacific could cause it
to incur substantial costs.

For instance, in the event that Georgia-Pacific is financially
unable to respond to an asbestos product liability claim,
plaintiffs' lawyers may, in order to obtain recovery, attempt to
sue BlueLinx, in its capacity as owner of assets sold by
Georgia-Pacific, despite the fact that the assets sold to
BlueLinx did not contain asbestos.

Asbestos litigation has, over the years, proved unpredictable,
as the aggressive and well-financed asbestos plaintiffs' bar has
been creative, and often successful, in bringing claims based on
novel legal theories and on expansive interpretations of
existing legal theories. These claims have included claims
against companies that did not manufacture asbestos products. As
a result of these factors, a number of companies have been held
liable for amounts far in excess of their perceived exposure.

Although BlueLinx believes, based on its understanding of the
law as currently interpreted, that it should not be held liable
for any of Georgia-Pacific's asbestos-related claims, and, to
the contrary, that it would prevail on summary judgment on any
such claims, there is nevertheless a possibility that new
theories could be developed, or that the application of existing
theories could be expanded, in a manner that would result in
liability. Any such liability would ultimately be borne by
BlueLinx if Georgia-Pacific is unable to fulfill its indemnity
obligation under the asset purchase agreement.

Georgia-Pacific has agreed to indemnify BlueLinx against any
claim arising from environmental conditions that existed prior
to May 7, 2004. The Company also carries environmental
insurance. However, any remediation costs not related to
conditions existing prior to May 7, 2004, may not be covered by
indemnification. In addition, certain remediation costs may not
be covered by insurance.

ASBESTOS LITIGATION: WR Grace Acts to End State Control at Site
W.R. Grace, a premier specialty chemicals and materials company,
is applying to end state oversight of the cleanup of its
contaminated North Cambridge property. They have held a public
meeting to present their "closure strategy." Meanwhile,
neighborhood groups are encouraging residents to demand long-
term protection from asbestos fibers.

Based on data collected by W.R. Grace, the Alewife Study Group,
a neighborhood watchdog organization, estimates that there are
600,000 pounds of asbestos buried in the soil on the site. In
2001, the federal Environmental Protection Agency concluded that
tests "indicated that there were significant amounts of asbestos
below the surface," but it "does not pose an immediate health
hazard as long as the waste remains buried."

Many North Cambridge residents are concerned because there are
not enough safeguards in place to keep the asbestos from being
exposed if the site is developed. Asbestos has been shown to
cause lung cancer, along with other diseases.

Environmental consultants for W.R. Grace are proposing that
development can occur if a plan is established for controlling
asbestos, dust and odors. There are currently no specific state
or federal requirements for handling asbestos-contaminated soil.

A Risk Characterization study, released by Cambridge
Environmental Inc. on Nov. 24 indicated that under current
conditions there is no significant risk, but if a large-scale
construction process is undertaken as planned, it could raise
the risk level 20 times the state guidelines for residents
living near the site.

"We need continued government oversight to ensure asbestos
fibers will not become airborne during future construction,"
said Ronnie Millar, a Jackson Street resident who lives with his
wife and two young children just two blocks from the site.

W.R. Grace had plans to develop the site into office buildings
and a hotel, but withdrew them just before filing for Chapter 11
bankruptcy protection under the weight of asbestos lawsuits.

Last Dec. 3, the Class Action Reporter revealed that W.R. Grace
had indicated that the Company expects grand jury indictments on
the first quarter of 2005 for criminal behavior related to
asbestos contamination in Libby, Montana.

The Alewife Study Group contends that the best solution is to
leave the asbestos buried in the soil undisturbed. W.R. Grace
intends to maintain protection with a deed restriction
specifying uses of the property that will be allowed or not
allowed, and through the requirement of a plan to contain
asbestos, dust and odors.

"The plan shall be developed by a certified industrial hygienist
or similarly knowledgeable and trained professional," according
to the draft Activity and Use Limitation document submitted by
consultants for W.R. Grace.

"The development process will not require someone certified by
the state to oversee the cleanup of contaminated waste, as would
be required if they developed the site now, under state watch,"
said Mike Nakagawa, who lives close to the W.R. Grace property
and is a board member of the community nonprofit group, Alewife
Neighbors Inc.

After the last public meeting in June 1999, there was much
concern over the way the site was being managed by the
environmental consultants hired by W.R. Grace as part of the
privatized state waste cleanup process. As a result of
discussions that followed the meeting, the city of Cambridge
instituted an ordinance to specify conditions for handling
asbestos in soil, the first such regulation in the country.

Residents are concerned that the ordinance may undergo changes
when W.R. Grace informs the city of its intent to develop the
site, and are pushing for specific state requirements for the
site in writing.

ASBESTOS LITIGATION: Parents Act to Abolish Asbestos Classrooms
The parents committee at an Israeli elementary school intends to
petition the High Court of Justice to order the municipality of
Lod and the Education Ministry to remove the hazards that
endanger the lives of the students. The committee is demanding
to improve the deplorable conditions surrounding their children
in Al-Rashidiyah elementary school who study in asbestos-riddled

The parents, together with the Musawa Center for Arab rights,
will ask the court to order the authorities to build new
classrooms instead of the asbestos structure currently housing
several of the classrooms.

The school's 550 pupils study in overcrowded conditions and are
subject to severe security and health hazards, the parents said.
"The school's shocking condition cannot fulfill the most minimal
requirements of education, and this violates the right to
education, equality and dignity," they said.

Attorney Rim Mazawi of Musawa said the school's safety hazards
endanger the pupils' lives. "We demand the authorities treat the
education system in the Arab community equally and stop
discriminating against it," he said.

ASBESTOS LITIGATION: Monsanto Co. Reserves US$285MM for Solutia
Marking a shift in the Company's position, Monsanto Co. (NYSE:
MON) last month said it would set aside US$285 million to cover
liabilities tied to its former affiliate Solutia Inc. (OTC:

This indicates an initial move to define the cost of legal
problems stemming from Solutia, which filed for Chapter 11
bankruptcy protection in December 2003. This move resulted from
years of litigation and debt remaining from its spin-off from
Monsanto in 1997.

Previously, Monsanto had unwaveringly refused to reserve for
Solutia's problems and asserted it did not think it was
obligated to take on any Solutia liabilities, which included
certain employee benefits, asbestos and PCB contamination clean-
up costs, and expenses for some 600 lawsuits.

Monsanto, a leading provider of agricultural products and
solutions, said it was reducing its first-quarter and 2005 net
earnings outlook because of the reserve, but said its operating
profits should be better because of strength in its biotech
seeds businesses.

Investors have been increasingly concerned and had awaited
indications from Monsanto on how much the bankruptcy of Solutia
might cost the company. However, news of the reserve, combined
with the talk of strength in Monsanto's seeds businesses, helped
push shares up more than 1 percent.

Monsanto Chief Financial Officer Terry Crews said that there
were still other potential liabilities related to the Solutia
bankruptcy that Monsanto could be forced to pay for, but the
Company thought it was important to begin to reserve for the

"It's possible the reserve may have to be adjusted in the
future," Mr. Crews said. "While we're not done, we're on the way
to bringing resolution to an issue that has been an overhang for
us for some time."

Because of the reserve, Monsanto said it now expects to post a
first-quarter net loss of 16 cents per share, compared with its
previous outlook for a profit 43 cents a share.

On an ongoing basis, which excludes the reserve, the first-
quarter outlook is now a profit of 13 cents a share; up from the
company's previous forecast for a profit of 4 cents a share.

For the fiscal year 2005, Monsanto pegged its net earnings at
US$1.56 to US$1.71 a share, down from its previous outlook for
US$2.16 to US$2.29 a share. On an ongoing basis, Monsanto's
full-year forecast was US$1.85 to US$2.00 a share, up from its
previous estimate US$1.77 to US$1.90 a share.

Mr. Crews said it was possible that Monsanto might receive some
equity in Solutia in exchange for taking on some of the costs,
but that will be dealt with through the bankruptcy process. "It
is something still to be worked out," he said.

ASBESTOS LITIGATION: Test Results Intensify Worries at MA Court
Two asbestos specialists are now urging the state to quickly
relocate workers at the Middlesex County courthouse in Cambridge
after tests revealed heightened levels of the carcinogenic
material. They are saying that despite complaints about health
risks going back two decades, the state has allowed employees to
be "unduly exposed" to potentially hazardous asbestos.

The 22-story courthouse, built in 1969, is full of sprayed-on
asbestos, some of it flaking or falling in clumps, according to
a report made public last month by Dr. L. Christine Oliver, a
specialist in occupational and environmental medicine, and Paul
Heffernan, who served as New England's regional asbestos
coordinator for the US Environmental Protection Agency.

Dr. Oliver and Mr. Heffernan, hired by a lawyer representing
employees at the courthouse and associations of lawyers, said
the state must start removing the asbestos "within months, not
years." In the meantime, they said, maintenance workers who have
probably been exposed the most should be offered physical

"The irrefutable medical and scientific evidence is that it's
not a safe place to be until it's abated," said Chris A. Milne,
the pro bono lawyer who hired the consultants and accompanied
them on a Dec. 8 inspection of the building. He said he wants
employees out of the building within six months or he will
recommend that his clients, the Superior Court Clerk Edward J.
Sullivan, the Massachusetts Bar Association, the Massachusetts
Academy of Trial Attorneys, and the Middlesex Bar Association,
sue the state.

District Court Judge George R. Sprague, one of several judges
alarmed by the findings, is wondering whether there is a
connection between the issue and his illness. He had surgery for
lung cancer in 2000 but had never smoked. His doctor did say
however, that his environment was the most likely cause of his

Judge Sprague said that a prior occupant of his office died of
lung cancer in the late 1980s, and that a courthouse employee
has compiled a list of seven or eight district court workers who
have died of cancer in the past 15 to 20 years.

Numerous employees, including the trial court's former chief
justice for administration and management, complained about
asbestos concerns as far back as 1984, the report states. But
the Division of Capital Asset Management, the state agency that
oversees government properties, ignored the problem and kept
many workers in the dark about potential dangers.

Neither David B. Perini, the head of the Division of Capital
Asset Management, nor Robert A. Mulligan, the trial court's
current chief justice for administration and management, had
commented on the report.

Last Dec. 9, in response to growing concerns about asbestos in
the building, both of them issued a joint statement saying that
tests conducted by the state in October showed no problems with
airborne asbestos at the courthouse - tests that Mr. Milne said
are not a reliable indicator of health risks.

Superior Court Judge Charles Grabau called the report
"comprehensive and compelling" and said he is concerned about
the safety of building occupants and visitors. He said he hoped
Mr. Perini and Mr. Mulligan heeded its recommendations.

Last Dec. 17's edition of the Class Action Reporter related that
Middlesex District Attorney Martha Coakley wanted the state to
move all her 70 to 80 employees to another location to safeguard
their health.

The asbestos has caused an uproar in recent months because the
state was preparing to remove the substance from the building's
elevator shafts while hundreds of employees continue to work in
the building. The US$14.3 million renovation project was
scheduled to start next spring.

ASBESTOS LITIGATION: Hardie Agrees to Asbestos Settlement Deal
Ending a 14-month wrangle, building products firm James Hardie
Industries NV has signed a landmark compensation deal for
thousands of Australians battling asbestos-related disease after
exposure to its products.

Chairman Meredith Hellicar pledged the Company would meet its
responsibilities to victims for decades to come as she announced
a deal which effectively wipes out a funding shortfall for
compensation of AUD1.5 billion Australian dollars or US$1.15
billion. Under the agreement Hardie will make annual payments to
a special purpose fund, capped at 35 percent of its free cash

The agreement will run for an initial period of 40 years but can
be extended. Initial funding will be around 250 million
Australian dollars. If approved by shareholders, a definitive
agreement will be signed next year. Initially the fund will
receive three years worth of funding. There will also be a two-
year funding buffer to be maintained by annual contributions.

Ms. Hellicar said the deal would allow the Company to grow
despite the huge financial burden and pledged to restore its
reputation, marred by the crisis since a 2001 move to the
Netherlands. "All parties involved in the recent negotiations
have agreed it is in the interests of asbestos claimants that
James Hardie is, and remains, financially strong and able to
continue to fund its growth," she said.

James Hardie was a leading supplier of asbestos related building
products to the Australian construction industry for decades,
often ending up in cheap residential housing much of which is
still standing.

Hardie, which now derives more than 80 percent of its income
from the U.S., had set up a AUD293 million compensation fund in
2001, but it proved inadequate to fully pay present and future
claims. Three years ago the Company moved its corporate domicile
from Australia to the Netherlands, which provoked a public
outcry and led to an inquiry by the government of New South
Wales into its operations.

Many former employees and other victims are angry that it
profited from asbestos when the dangers were clearly known and
the plight of victims has united all sections of Australian
politics. The inquiry found in September this year that Hardie
broke Australian law when it misled the public about money set
aside for the fund.

Ms. Hellicar apologized to victims for the funding shortfall of
the Medical Research and Compensation Foundation, which recently
filed for liquidation. "I regret any stress caused to asbestos
disease sufferers and their families by the unintentional
funding shortfall of the MRCF and hope that this announcement
will ease the concern of those sufferers and their families,"
she said.

Australian Councl of Trade Unions secretary Greg Combet, who led
the negotiations, warned shareholders not to think about
blocking the deal, saying the Company could be forced to
implement it, through legal action in Australia or the United
States, where most of its assets now are.

With thousands of new cases of asbestos-related disease expected
to arise in Australia in the coming decades, unions put the
ultimate value of the deal at up to AUD4.5 billion.

One former employee said around 50,000 more people in Australia
would likely be diagnosed with asbestos related disease by 2020,
of which up to 18,000 would die of mesothelioma, a deadly lung

The crisis affected the company's profitability. Profits for the
six months to September were down seven percent at 61.1 million
US dollars and full-year profits are also expected to be hit.

A victim, Stewart Beckworth, said the money would not keep him
alive, but would help his wife and seven children cope without
him. He contracted mesothelioma from working with James Hardie
asbestos products as a builder in Victoria. He has signed a
confidentiality agreement preventing him from revealing how much
compensation he has received. But it is understood that victims
will receive about AUD200,000 on average.

Following the agreement, the New South Wales Government has
called for all bans and boycotts of James Hardie products to be
lifted. Local Government Association president Genia McCaffery
said, "I think they're to be congratulated, that's why I will be
in our first executive of next year, getting a resolution to say
that we should remove the ban."

Victims and unions were optimistic the building products Company
would not renege on its agreement to compensate its asbestos
victims over the next 40 years in a deal worth as much as
|US$4.5 billion. Hardie said it was possible but unlikely that
its historic asbestos compensation settlement could still come

James Hardie's agreement is only in principle, with a legally
binding agreement to follow a NSW Government review of the
States asbestos compensation system. Ms. Hellicar said, "This is
a 40-page agreement, it isn't a draft ... it is a signed heads
of agreement and although that's not legally binding, it's
certainly completely morally binding," she said.

The agreement to provide further funds, negotiated with the
company's unions, will both save the foundation, and assure
payments on present and future clams. It is the largest such
voluntary settlement in Australian legal history.

ASBESTOS LITIGATION: Father, Son Get Prison in Removal Scam Case
A father and son were sentenced late last month to lengthy
prison terms and ordered to pay $23 million in restitution for
cutting corners and faking tests in an asbestos removal
operation that put thousands of people at risk around the state.

Assistant U.S. Attorney Craig Benedict said the scheme by
Alexander and Raul Salvagno was among the "longest, most serious
environmental crimes in United States history."

U.S. District Court Judge Howard Munson sentenced Alexander
Salvagno, aged 38, to 25 years in federal prison. His father,
Raul, aged 72, was sentenced to 19 1/2 years.

Raul and Alexander Salvagno, owners of AAR Contractor Inc., were
convicted of running their Latham, N.Y.-based asbestos-removal
Company as a criminal enterprise to defraud customers and
violate the federal Clean Air Act and Toxic Substance Control

A federal jury convicted them last March 30 of running a
racketeering conspiracy that defrauded customers over a decade.
Former employees testified the Company took shortcuts on
cleanups and falsified tens of thousands of tests over the
course of a decade of wrongdoing.

Prosecutors identified 1,555 victims, including a nuclear power
plant, a children's interactive science museum, a brewery, a
hospital and dozens of college buildings around the state.

U.S. District Judge Howard Munson listened to more than two
hours of statements from the defendants and their victims. One
of those who testified was Timothy Lawson, the superintendent of
the Warrensburg Central School District, who said the Company
never fully removed asbestos from his school district's
buildings. An environmental consultant recently found chunks of
leftover asbestos stashed in desks that were in storage, Mr.
Lawson said.

The district will have to pay an extra US$120,000 to US$155,000
to finish removing the asbestos, in addition to what they paid
during a renovation project in 1995 and 1996.

Mr. Benedict said the restitution will be used to pay the
government and private customers who had fraudulent asbestos
abatement work done by AAR Contractor Inc. or its affiliates.
Part of the restitution will be used to establish a fund for
medical screenings and treatment of those who may have been
exposed to asbestos.

Asbestos was used commonly until the 1970s in insulation and
fireproofing material. Inhalation of the tiny asbestos fibers
can cause lung diseases such as asbestosis, mesothelioma and
lung cancer. But it can take years, even decades for symptoms of
the illnesses to occur.

"This criminal case, and the lengthy prison sentences imposed,
send a clear message: Those who knowingly jeopardize public
health will be held fully accountable for their crimes," said
Thomas V. Skinner, the U.S. Environmental Protection Agency's
acting assistant administrator for Enforcement and Compliance

ASBESTOS LITIGATION: Ex-worker Files GBP50T Claim V. RG Carter
A former employee, who claims he fell ill after being exposed to
asbestos more than 30 years ago, is suing one of the leading
family-owned construction businesses in Great Britain.

Michael Johnson, aged 62, of Crown Green, Burston, has issued a
writ against RG Carter Ipswich, claiming damages of at least
GBP50,000 for personal injury and resulting losses after he
developed pleural mesothelioma, a rare form of cancer.

The writ, issued at the High Court in London, says Mr. Johnson
contracted the disease after negligent exposure to asbestos
during his employment with one of the firm's businesses,
Blackburns builders and contractors in Harleston, between 1958
and 1963.

Since then, he has undergone chemotherapy and radiotherapy, and
the writ adds that his life has been shortened by about 20
years. He will need high levels of nursing care and painkilling
medication during the last months of his life, it says.

It is also claimed that RG Carter Ipswich, of Drayton, near
Norwich, failed in its statutory duty to protect Mr. Johnson,
who worked as an apprentice carpenter in a joiner's shop and at
commercial, domestic and school sites across East Anglia.

The writ says he carried out work during which he was exposed to
and inhaled or ingested asbestos. He also had to shape and drill
asbestos sheets on a regular basis. This work and that of others
caused "substantial quantities" of asbestos fibers to be
released into Mr. Johnson's "breathing zone" on a regular basis.

Simon Davis, of Kester Cunningham John solicitors, in Thetford,
representing Mr. Johnson, said the exact amount of the claim had
yet to be assessed.

"Mr. Johnson has contracted a disease, which will kill him, in
circumstances which suggest that his employers should have done
more to protect him from asbestos exposure," he said.

Mr. Johnson found out he was suffering from pleural
mesothelioma, which affects the lungs, in January 2004. He first
experienced symptoms in summer 2003 and suffers from
breathlessness, fatigue, a severe cough and the prognosis is

He claimed that at no stage during his work was he warned about
the dangers of asbestos or provided with any form of respiratory

Alleged breaches of statutory duty include failing to provide
adequate ventilation in the area where Mr. Johnson worked,
failing to give him suitable overalls and head coverings and
failing to keep free from asbestos waste and dust the machinery,
benches and equipment he used.

A previous edition of the Class Action Reporter dated Nov. 19,
2004 revealed that Pamela Wiseman, the widow of another employee
of the firm, RG Carter, has been actively pursuing her
compensation claim against the Company's insurers. A former
apprentice, her husband Robin Wiseman, was diagnosed with
mesothelioma on December 2003 and succumbed to the illness last
October 9.

ASBESTOS LITIGATION: NZ Victims Fight for Part of Hardie Deal
In light of the recent settlement between James Hardie
Industries NV and the Australians suffering from asbestos-
related disease due to exposure to its products, New Zealand
victims are preparing to launch a fight for a share of this $1.6
billion deal.

Under New Zealand law, sufferers cannot file a lawsuit against
James Hardie's local subsidiaries and can get compensation only
from the Accident Compensation Corporation. The ACC receives
about 50 new claims for asbestos-related lung disease every

Until it was banned in 1984, asbestos was used in wallboard and
other building materials in Australia, which has the world's
highest death rate from the asbestos-related disease

A hearing early this year would determine whether New Zealanders
could sue James Hardie in Australia for the products that were
used in this country, said Wellington lawyer Hazel Armstrong,
who represents clients in asbestos-related cases. She added, "A
hearing in New South Wales in February should make that

Ms. Armstrong said victims in Australia received an average of
$245,000 compensation but New Zealand sufferers received
considerably less.

ASBESTOS LITIGATION: French Senate to Study Contamination Issue
The French Senate is planning to establish a study of the
asbestos contamination problem. A group of 28 senators
representing various political parties on a proportional basis
is slated to lead this study. This research would include the
issue of responsibility and its human and financial

According to the statement released last month, this group could
deliver its conclusions by the end of the Parliamentary session
in June 2005.

Asbestos was widely used for fireproofing and insulation until
the 1970s. Scientists say inhaled fibers are linked to cancer
and other diseases.

In the United States, companies have paid out an estimated US$70
billion on about 730,000 asbestos claims, making it the most
expensive type of litigation in U.S. history, according to the
RAND Institute for Civil Justice.

ASBESTOS LITIGATION: 9/11 Rescue Dog Takes Part in Health Study
A 9-year-old German Shepherd rescue dog is participating in a
scientific study on the effects of inhaling asbestos-laden cloud
of gases and dust that covered Lower Manhattan after the
September 11 attack.

Three years ago, Mizu the rescue dog helped search for bodies in
the smoldering remains of the World Trade Center. There at
ground zero, Mizu, who works for Miami-Dade Fire Rescue, spent
two weeks sniffing the rubble for signs of survivors or their

The results of the study could save human lives. Since the dogs
did not have masks to protect them, and since their metabolism
works faster than people's, scientists are monitoring the
animals to see if they develop any illnesses because of their
exposure. If they do, it may provide an early warning of
problems that would only show up in humans years later.

"Dogs live a more compact life than humans. Their hearts beat
faster, there's more packed into those years," said Kurt
Iverson, a spokesman for dog-food manufacturer Iams, one of the
study's sponsors. "What happens to them gives us an indication
in what humans can expect down the line."

So Mizu travels yearly to the Iams Pet Imaging Center in Vienna,
Va., where veterinarians use magnetic resonance imaging to view
her brain, sinus cavity, nasal passages, glands and other soft
tissues where diseases can develop. The scans give vets a three-
dimensional view that reveals tumors or cancers that can't be
caught by X-rays.

So far, the news is good for the 17 dogs in the study, whose
other sponsors include the University of Pennsylvania and the
American Kennel Club Canine Health Foundation. A recent progress
report said the dogs appear to be in good health and cancer-

"It really is surprising at her age that she's going strong,"
says Mizu's owner, firefighter Billy Kidd, of Miami-Dade Fire
Rescue's aviation unit. "It's a real hazardous job."

Disaster dogs usually die of cancer by age 7 or 8; the grueling
job wears on their bodies and grinds down their joints, says Mr.

The 9/11 study caps a long career for Mizu, who has served in
recovery missions around the world, arriving in the wake of
earthquakes and explosions.

ASBESTOS LITIGATION: Union Pacific Sets $153.6MM Asbestos Charge
Shares of Union Pacific Corp. surged last month after it said it
will set aside US$153.6 million to pay for potential asbestos
exposure claims, as it makes a switch to estimating future
liability and away from calculating claims as they arise.

The Company, operator of the nation's largest railroad, is
raising its fourth-quarter outlook, despite this charge, saying
revenue for shipping commodities would grow faster than
previously expected.

The after-tax asbestos charge amounts to 58 cents per share, a
figure that Union Pacific said would cover liability for
unasserted claims. It has hired a consultant to determine the
amount, which means ongoing asbestos expenses would decline
beginning in 2005, adding about US$8 million a year to earnings.

Fourth-quarter earnings, excluding the asbestos charge, would
now be 82 cents to 87 cents per share, reflecting stronger
commodity revenue growth of 8 percent rather than 5 percent.
That far outpaces previous Union Pacific estimates of 65 cents
to 75 cents per share.

"Partially offsetting this growth are continued high operating
expenses related to network inefficiencies resulting in an
estimated operating margin of approximately 13 percent," the
Company said.

The average analyst estimate from Thomson First Call is for
fourth quarter earnings of 68 cents per share.

Union Pacific's rail lines cover 23 states in the western two-
thirds of the country. It is a leading carrier of low-sulfur
coal used in electrical power generation and has broad coverage
of the large chemical-producing areas along the Gulf Coast.

ASBESTOS LITIGATION: Tasmanian Victims Gain More Time for Claims
New laws extending the time people can pursue a claim for injury
in court came into effect on January 1. This change in law now
allows up to 100 Tasmanian asbestos victims to seek

The symptoms of asbestosis and other asbestos-related illnesses
are dormant and sometimes do not appear for 40 years, but the
Limitations Act had prevented workers who had been negligently
exposed to asbestos from seeking compensation because it did not
allow for retrospectivity.

Responding to calls to improve Tasmania's negligence laws, the
Legislative Council passed a bill to remove asbestos-related
diseases from the Limitations Act 1974 last month. Before the
amendments, Tasmania had some of the strictest limitations in
the country. The change removes the six-year deadline on claims.

Under the new laws, a person can claim up to 12 years from when
the injury was caused, or three years from when the injury was
discovered. There is also some provision for retrospective
application to cover those who knew they were ill but were
prevented from claiming because of the old laws.

Acting Attorney-General Paula Wriedt said the changes brought
the laws into line with most other states. "If someone suffering
a latent disease, such as asbestosis, has recently discovered or
discovers in the future they are suffering from that disease,
they can apply to the court to have the time for taking action
extended to three years from the date of the discovery," she

Former Goliath Cement Works employee Laurie Appleby said he was
relieved that Tasmanian workers could now be treated fairly.
"This change has come about after two and a half years of
constant door banging and lobbying of politicians," he said.

Mr. Appleby said that almost all Tasmanian asbestos victims had
worked at Goliath's Railton plant, now owned by Cement
Australia. He said he himself had unloaded asbestos, imported
from interstate, from trucks at the Railton site from 1969 to

Mr. Appleby said that as president of Asbestos Disease Tasmania,
he gets numerous calls by former employees affected by asbestos-
related illness every week. At the moment, the group is seeking
legal advice to determine who to pursue, Goliath or the company
that supplied the asbestos or both. He also plans to hold
seminars to ensure that Tasmanians are made aware of their
entitlements under the new law.

ASBESTOS LITIGATION: Courts Order Plaintiffs to Prove MS Ties
In an effort to weed out non-residents, some 13,000 plaintiffs
in three Mississippi courts have been ordered to show they
either live in Mississippi or were injured there or face the
chance their lawsuits will be dismissed.

The courts heeded the dictates set in a series of rulings that
began in February 2003. The state Supreme Court has said out-of-
state plaintiffs must be dismissed from asbestos and similar
litigation and that plaintiffs in the same county must have
separate trials.

Jefferson County Circuit Judge Lamar Pickard has given about
8,000 plaintiffs 20 days to say where they live and where they
were exposed to asbestos. In cases that involve Mississippi
companies, the county of each company must be listed. More than
10,000 plaintiffs overall have sued in Jefferson, Copiah and
Claiborne counties, alleging injuries from asbestos.

Holmes County Circuit Judge Jannie Lewis has set a 60-day
deadline for about 4,000 plaintiffs to show why they have
standing to sue in Holmes, Humphreys or Yazoo counties. Those
exposed outside of Mississippi will be dismissed, and the claims
of those allegedly exposed in other counties will be transferred
to those districts.

Circuit Judge Winston Kidd has delivered a similar ruling in
Hinds County, involving about 1,300 plaintiffs and giving them a
225-day deadline.

The lawsuits involve thousands of plaintiffs in and outside
Mississippi and hundreds of defendants. The defendants are
mostly companies where the plaintiffs claimed to have been
exposed to asbestos.

The judges' actions came in response to a Mississippi Supreme
Court ruling in August on an asbestos case from Bolivar County.
The Supreme Court ruled the plaintiffs must provide the
defendants with information on whom each plaintiff sued and why.
That information should also include when and where the
plaintiff was exposed.

The Supreme Court said if the information is not provided, the
claim should be thrown out. The justices also said separate
trials should be scheduled for each plaintiff and those cases
involving residents in other Mississippi counties should be
transferred to other courts.

"The judges' rulings relating to out-of-state plaintiffs not
only follows the law, but makes common sense. Mississippi should
not be a dumping ground for claims that have no connection to
this state," said Jackson defense lawyer Larry Jones.

Starkville lawyer Mickey Montgomery, who represents 5,864
plaintiffs, said the rulings are not the final hearings. "There
are a lot of issues involved in this," he said. "Each plaintiff
may have different causes of action. There are so many

Marcy Bryan Croft, a Jackson lawyer who represents more than 75
defendants, said she conservatively estimates about half of the
more than 13,000 plaintiffs affected are from out of state. She
said more rulings are expected.

Circuit Judge Billy Landrum has not ruled on asbestos cases in
Jones County involving about 15,000 plaintiffs.

Defendant companies have asked Mississippi judges to dismiss the
asbestos lawsuits, citing recent court cases that have thrown
out "shotgun" complaints. A shotgun complaint often involves
hundreds of plaintiffs and is so vague in describing
circumstances and injuries that defendants claim the allegations
are difficult or impossible to respond to.

Ms. Croft said these rulings by judges will help those truly
injured. "It will give Mississippi citizens better access to
Mississippi courts," she said.

ASBESTOS LITIGATION: NZ Man Fighting For Compensation Inclusion
An Auckland man whose father died from asbestosis last year has
appealed to Prime Minister Helen Clark for help getting victim
compensation similar to that offered to Australian victims.

In his letter, John Lehmann has asked PM Clark for Government
support to boycott James Hardie building products. He wrote,
"They are not good corporate citizens. They should be made to
pay those victims." He added that the company knew several years
ago their products would kill people "but carried on profiting."

Last month, an agreement signed in Melbourne meant thousands of
families would be compensated after individuals were ravaged by
the deadly respiratory disease mesothelioma. Victims and unions
in Australia had been fighting for compensation from James
Hardie and the company agreed to a compensation plan for
mesothelioma victims for at least the next 40 years. The
agreement included a confidentiality clause but it is believed
on average, victims would receive about $220,000.

Mr. Lehmann said the agreement in Australia covered Australians
only. "We are saying this is grossly unfair. The New Zealand
workers are suffering just as badly as the Australians did. We
need to have some sort of compensation."

A previous edition of the Class Action Reporter on Sept. 3,
2004, disclosed that the Accident Compensation Corporation had
appealed the NZD100,000 award to the estate of Ross Lehmann, who
worked as a fitter and welder. The ACC had paid him compensation
but had demanded it back on legal issues.

ASBESTOS LITIGATION: Dana Corp and Insurers Sign Settlement Deal
On December 17, 2004, manufacturer of car parts Dana Corp. and
certain of its insurers signed a settlement agreement and
release with respect to:

(1) Existing and future liabilities, expenses and losses arising
out of claims under certain policies subscribed to by the
insurers providing insurance to Dana; and

(2) Certain alternate dispute resolution and court proceedings
to which Dana and the insurers are parties.

The agreement provides for the insurers to make cash payments to
Dana in exchange for, among other things, the Company's release
of all rights under the settled insurance policies and its
assumption of liability for all future claims under these

Dana expects to receive a payment under the agreement in the
fourth quarter of 2004, which it will apply to substantially
reduce the US$54 million amount recoverable for settled
asbestos-related product liability claims and related defense
costs and the estimated US$30 million amount recoverable for
claims relating to defaults by some former members of the Center
for Claims Resolution on the payment of their shares of CCR-
negotiated settlements in connection with asbestos-related
product liability claims.

The agreement also provides for Dana to receive cash payments in
2005, most of which are conditional. The Company expects to
apply such payments, when and if received, primarily to reduce
the US$118 million recoverable relating to settlements of
pending asbestos-related product liability claims.

Founded in 1904 and based in Toledo, Ohio, Dana operates
technology, manufacturing, and customer-service facilities in 30
countries. Sales from continuing operations totaled US$7.9
billion in 2003.

ASBESTOS LITIGATION: Councilors Call for More Tests at TBA Site
A group of councilors is calling for further tests for asbestos
on the former Turner Brothers site in Rochdale, once the largest
asbestos factory in the world. The six councilors, who were
tasked to investigate the residents' concerns, fears many areas
on the 70-acre site have been left unchecked.

In a report that will go to planning officers, developers say
only one out of the 86 soil tests they carried out showed any
traces of the potentially deadly dust. The report says traces of
lead and copper were more prevalent on the site, on which they
hope to build an "urban village" containing 650 houses and a
business park.

One member, Councilor Elwyn Watkins, says he discovered asbestos
fibers hanging on trees when he joined campaigners on the north
side of the site near Healey Dell Nature Reserve. "Although the
developers have carried out 86 tests, I don't think they have
sampled the majority of the site," he said.

"We have to make certain that any areas to be developed have no
asbestos on them or that it can be properly dealt with if found.
As a working party, we will be calling for a proper management
plan of the contaminated areas and for them to be fenced off
before any work is carried out," added Councilor Watkins.

The Save Spodden Valley campaign group also wants the working
party to consult ex-workers who may know the location of any
asbestos. Spokesman Jason Addy said, "The developers' report
does not seem to address the history of the site or the issue of
contamination fully. We haven't delved into matters like sewers
and road access yet - our number one priority remains public

The outline application revealed the developers - Rathbone
Jersey Ltd, MMC Development and Countryside Properties
(Northern) Ltd - also wish to alter access points on Rooley Moor
Road and build community facilities like shops and a doctors'

The Friends of Healey Dell fear the move could put local
wildlife at risk. Spokesman Rhys Watkins said, "Obviously, we
are very concerned about the effect the development could have
on Healey Dell, particularly the effect of any tree felling on
the local wildlife. But a proposal to build houses on an old
asbestos site is equally worrying."

ASBESTOS LITIGATION: PBS Approval of Alimta Encounters Setbacks
Despite being considered standard treatment by medical experts,
Australia's federal committees have yet to include Eli Lilly's
new drug Alimta in the Pharmaceutical Benefits Scheme, which
subsidizes a selected list of medicines.

The government committees failed to approve the drug although it
has been proven to improve the quality of life and longevity of
those with mesothelioma. Australia was one of the first
countries in the world to require products to be cost-effective
as well as efficacious before they can be listed.

Brisbane medical oncologist Rick Abraham said earlier this week
mounting evidence of the success of Alimta chemotherapy made it
standard treatment for the "cruel, insidious" disease.

Dr. Abraham said Alimta was the only drug shown to prolong the
life span of victims by three months, drastically cut the amount
of mesothelioma present in about half of patients, and improved
quality of life overall. However, the drug costs $4500 for each
treatment, and the average patient needed six treatments at
three-weekly intervals.

"They're being punished twice - waiting for the resolution of
the James Hardie [compensation claims], and being aware the drug
Alimta is licensed for use in this country, experts say it's
standard but it's not available on the PBS," Dr. Abraham said.

Malignant mesothelioma is a cancer of the outer covering of the
lung or abdominal cavity, and is frequently associated with past
exposure to asbestos. The disease can be dormant for up to 25
years before symptoms develop, but it is very aggressive and
painful, with most people given only three to 12 months to live.

About 100 Queenslanders were diagnosed every year, but by 2017
up to 10,000 Australians who have currently have no symptoms
will be diagnosed with mesothelioma. Australian has the highest
incidence of asbestos-related deaths with 26.3 deaths per
million people, compared with 24.08 deaths per million in the
Netherlands and 8.21 deaths per million in the US.

Dr. Abraham, whose father has asbestos-related lung disease and
brothers were also at risk, said the two-year trial involving 60
patients found thalidomide benefited some patients but its
toxicity resulted in significant side effects. "It gave some
benefit in terms of symptom relief, but when you looked at scans
there was no major reduction," he said.

The final results were presented at the Clinical Oncology
Society of Australia annual meeting last month.

ASBESTOS LITIGATION: BHP Billiton Faces Pressure to Put Up $240M
Lawyers and unions are now pressuring BHP Billiton to set aside
more than $240 million to pay compensation to former
shipbuilders exposed to deadly asbestos in its Whyalla

Lawyer Tania Segelov said the $4.5 billion settlement that James
Hardie Industries entered to fill compensation claims by its
victims should serve as a warning to other companies such as
BHP. "These companies should be sensitive to what happened at
James Hardie and to the trauma it causes the victims," Ms.
Segelov said. "They have to reassure victims they have the money
to pay and will pay up quickly."

About 800 former workers are expected to die from mesothelioma,
with each eligible for compensation of between $250,000 and
$300,000. That could result in BHP paying more than $240

The final tally does not include the estimated hundreds of
millions of dollars in compensation to be paid to men whose
diseases are not life threatening but will require intensive
medical care for many years. Funds for research into asbestos-
related disease would also have to be allocated.

More than 200 former shipbuilders have died or are seriously ill
after being exposed to asbestos in Whyalla. But about 20,000
workers were said to have been exposed to asbestos at BHP for
over 37 years. Doctors expect the death toll will top 800.

Australian Manufacturing Workers' Union state secretary John
Camillo said new cases emerged almost daily. He believes that
BHP has to make sure they put money aside to pay compensation
for the next 20 or 30 years. He plans to meet Industrial
Relations Minister Michael Wright to pressure the State
Government into setting up a specialist dust diseases tribunal
to handle asbestos cases.

A BHP Billiton spokeswoman said the company is "fully able to
meet its asbestos liabilities." She adds, "We have met all our
asbestos liabilities to date and will continue to do so."

Asbestos liabilities were recalculated each year to ensure the
company covered its financial risk. BHP claims it never knew of
the dangers of asbestos exposure, despite mounting evidence
since the 1920s.

ASBESTOS LITIGATION: Aearo Increases Liability Estimate For 2004
Aearo Co. reported on its latest filing to the Securities and
Exchange Commission that the Company is a defendant in lawsuits
by plaintiffs alleging that they suffer from respiratory medical
conditions, such as asbestosis or silicosis and that such
conditions result, in part, from the use of respirators that
were negligently designed or manufactured.

The Company states that the defendants in these lawsuits are
often numerous, and include, in addition to manufacturers and
distributors of respirators, manufacturers, distributors and
installers of sand, asbestos and asbestos-containing products.

As of September 30, 2004 and September 30, 2003, the Company has
recorded liabilities of about US$5.4 million and US$4.5 million,
respectively, which represents reasonable estimates of its
probable liabilities for product liabilities substantially
related to asbestos and silica-related claims as determined by
the Company in consultation with an independent consultant.

This reserve is reevaluated periodically and additional charges
or credits to results of operations may result as additional
information becomes available. Consistent with the current
environment being experienced by companies involved in asbestos
and silica-related litigation, there has been an increase in the
number of asserted claims that could potentially involve Aearo
Corporation and its subsidiaries, including the Company.

Various factors increase the difficulty in determining the
Company's potential liability, if any, in such claims, including
the fact that the defendants in these lawsuits are often
numerous and the claims generally do not specify the amount of
damages sought. Additionally, the bankruptcy filings of other
companies with asbestos and silica-related litigation could
increase the Company's cost over time.

In light of these and other uncertainties inherent in making
long-term projections, the Company has determined that the five-
year period through fiscal 2009 is the most reasonable time
period for projecting asbestos and silica-related claims and
defense costs. It is possible that the Company may incur
liabilities in an amount in excess of amounts currently

Through subsidiary Aearo Company, Aearo Corporation makes and
sells personal protection equipment in more than 70 countries.
Products include earplugs, goggles, face shields, respirators,
hard hats, safety clothing, first-aid kits, and communication
headsets. Headquartered in Indianapolis, Indiana, the firm also
sells safety prescription eyewear and makes energy-absorbing
foams that control noise, vibration, and shock for use in its
own and other manufacturers' products.

ASBESTOS LITIGATION: Halliburton's $5Bil Asbestos Deal Closed
Halliburton Company earlier this week claimed it had ended the
asbestos problems that have hounded it for years with a US$5
billion settlement.

The Houston-based oil services conglomerate's construction and
engineering subsidiary, KBR, and other subsidiaries that filed
for bankruptcy protection in December 2003 as part of the
settlement have emerged from Chapter 11.

The reorganization plan, which included a US$2.775 billion cash
payment with the rest in stock to settle 400,000 asbestos and
21,000 silica claims, received court approval in July last year
and went into effect last Dec. 31.

"The asbestos chapter in Halliburton's history is closed," said
Dave Lesar, chairman and chief executive of Halliburton.

Halliburton inherited the claims when the company acquired
Dresser Industries, Inc. for US$7.7 billion in 1998 - a deal put
together by Vice President Dick Cheney during his tenure as CEO
from 1995 to 2000. Most of the asbestos claims were filed
against a former Dresser subsidiary, Pittsburgh-based Harbison-
Walker Refractories Co.

The settlement allows Halliburton to take several subsidiaries
out of bankruptcy protection and spin off the Kellogg Brown &
Root arm.

KBR is the engineering and construction unit that is the largest
military contractor in Iraq, taking in more than US$10 billion
for repairing oil fields and providing services to soldiers.
Halliburton said last year that it proposed to sell off or float
KBR once it had resolved its asbestos liability.

Moody's Investors Service, the credit ratings agency, reaffirmed
Halliburton's "Baa2" senior unsecured debt ratings and revised
the company's rating outlook to "positive" from "stable" on the

"The rating affirmation and positive outlook reflect the
significant benefits to Halliburton of capping its asbestos
exposure, as well as the company's near-term opportunities to
reduce its debt obligations with free cash flow," Moody's

Halliburton and KBR have been criticized for contracts in Iraq
and Kuwait to serve food, deliver fuel, handle mail and provide
other services for U.S. troops. Several federal agencies are
investigating allegations of overbilling and favoritism stemming
from Cheney's past tenure as company head. Halliburton has
consistently denied any wrongdoing.

Halliburton said the company anticipates funding trusts to pay
the claims by the end of this month.

ASBESTOS LITIGATION: Oglebay Norton Co Named by 73,000 Claimants
Oglebay Norton Company (Pink Sheets: OGLEQ) in its most recent
filing to the Securities and Exchange Commission reported that
it has been named as a defendant in various lawsuits related to
silica and asbestos exposure. As of September 30, 2004, it was
named a co-defendant in cases alleging asbestos-induced illness
involving claims of about 73,000 claimants. With respect to
silica claims, it was named a co-defendant in cases involving
about 23,000 claimants.

Subject to Bankruptcy Plan confirmation prior to December 15,
2004, the Company agreed to settle about 20,000 of these
asbestos related claims, to be paid primarily using funds in the
insurance trust established pursuant to the Settlement Trust
Agreement, made and entered into on August 28, 2003, by and
among its subsidiary ON Marine Services Company, underwriters at
Lloyd's and London Market Company Signatories and Wells Fargo
Bank Minnesota, N.A.

After the most recent settlements, Oglebay claims to have about
US$240 million of insurance resources available to address both
current and future asbestos liabilities. Currently, it faces
about 53,000 unresolved asbestos claims asserted against it
before filing for bankruptcy and after the most recent
settlements and have had an average of 15,000 asbestos claims
asserted against it each year over the past five years. The
average cost per claim for settlement or other resolution over
the past five years prior to the most recent settlements was
about US$1,100 and the average cost per claim of the most recent
settlements was about US$3,000.

The plaintiffs in these cases generally seek compensatory and
punitive damages of unspecified sums based upon common law or
statutory product liability claims. Some of these claims have
been brought by plaintiffs against the Company and other product
manufacturer co-defendants, some of whom have also filed for
bankruptcy protection. In addition, Oglebay believes that it is
the target of hundreds of lawsuits relating to the exposure by
seamen employees to asbestos on our vessels. Considering its
past operations relating to the use of asbestos, it is possible
that additional claims may be made against it based upon similar
or different legal theories seeking similar or different types
of damages and relief.

The Company also reported that several of its subsidiaries have
been and continue to be named as defendants in a large number of
cases of asbestos and silica-related cases, which have been
stayed by the Chapter 11 filings. The plaintiffs in the cases
generally seek compensatory and punitive damages of unspecified
sums based upon the Jones Act, common law or statutory product
liability claims.

The Company asserts that both the asbestos and silica product
liability claims are covered by multiple layers of insurance
policies and an insurance trust from multiple sources. In the
third quarter of 2003, Oglebay agreed with one of its several
insurers to fund a settlement insurance trust to cover a
significant portion of settlement and defense costs arising out
of asbestos litigation. This means that the Company will have
access to insurance trust funds to cover asbestos settlements
and defense costs and will not have the obligation to cover such
costs from its own funds to the extent so covered.

Accordingly, the US$2.408 million reserve for asbestos claims
related to insolvent insurers recorded at the end of 2002 has
been reversed, as has an US$845,000 increase to this reserve
provided during the first half of 2003. The agreement provides
that the Company may use up to US$4 million (US$1.681 million
used in 2003) of the insurance trust's assets to cover the cost
of any other related or unrelated insurable or insurance related

On November 4, 2004, the Company filed a motion with the
Bankruptcy Court seeking approval of certain settlement
agreements between our affiliate ON Marine Services Company and
certain asbestos claimants. The settlements with these tort
plaintiffs resolve about 20,000 of the about 73,000 asbestos
claims asserted against certain of our affiliates, as of
September 30, 2004.

The Company estimates that the payments under the settlement
agreements for about 17,800 of these asbestos claims will
aggregate about US$53.204 million and will be paid from the
insurance trust established pursuant to the Settlement Trust
Agreement, made and entered into on August 28, 2003.

The remaining 2,200 settled asbestos claims will be paid upon
the approval of the insurers paying the claims, and the total
amount of settlement payments under the settlement agreements
relating to these asbestos claims cannot be determined until
medical and exposure evidence is provided by such claimants. The
Company anticipates that any settlement payments made on account
of such claims will be paid under both the insurance trust and
its other insurance policies.

As part of the settlement agreements, about 20,000 asbestos
cases against ON Marine Services Company will be dismissed, and
it will obtain a general release from the settling tort
plaintiffs. A hearing on the settlement motion commenced with
the Bankruptcy Court on November 16, 2004 and relief requested
in the motion was granted on November 17, 2004.

ASBESTOS LITIGATION: Senate Panel Seeks End to Asbestos Lawsuits
Despite a two-year deadlock, the incoming chairman of the Senate
Judiciary Committee said republicans will aim for quick action
on a measure that would end asbestos lawsuits in exchange for a
trust fund to compensate victims.

Sen. Specter, a Pennsylvania Republican, hoped to get the bill
approved by committee and on the Senate floor by "late January
or early February," but acknowledged this would be difficult.
"It is my hope to be able to present a bill through markup at a
very, very early date," he said.

Republicans say Democrats wouldn't let previous bills pass
because trial lawyers don't want to lose the money they make
from asbestos lawsuits. Democrats argue that the Republican
bills didn't have enough money for victims and that Republicans
are only trying to help their friends in the business and
insurance communities by immunizing them from lawsuits.

Sen. Specter said negotiations are still going on. "We're very
close on many, many issues," he said. "There are some issues
where there is some difference of opinion, but the differences
have been narrowed."

Sen. Specter said his office had held some 34 meetings on the
subject, presided over by a federal appeals judge, Edward
Becker, and "a lot of progress has been made." There were still
questions, however, about how much money would go into the fund,
and under what conditions claimants could revert to the court
system, he said.

Former Senate Democratic leader Tom Daschle last year offered
Republicans a compromise US$141 billion trust fund for people
suffering from asbestos-related diseases, but no action was
taken. Republicans also were not able to get enough support for
a US$124 billion trust fund financed by businesses and insurance
companies to ensure Senate passage.

Sen. Specter would not say what numbers he would start from with
his legislation, but he hoped to circulate a draft later this
week and perhaps meet with interested parties next week. He also
said he hoped to hold his first hearing on the subject Jan. 11,
after the committee finishes with its confirmation hearings for
Attorney General nominee Alberto Gonzales.

Senate Majority Leader Bill Frist, R-Tenn., also said he plans
to push legislation to curb class-action lawsuits. "I'm
confident we'll pass this bill and take a big first step to
restoring sanity and fairness to our legal system," he said.

The legislation would move more class-action lawsuits out of
state courts and into federal courts. Opponents of the
legislation say federal judges will either throw out many of the
cases or be less likely to issue multimillion-dollar judgments
against corporations.

ASBESTOS LITIGATION: UK School Union Demands Release of Findings
A teaching union is demanding that a report into the disturbance
of asbestos at a school in Derby be made public. It wants
findings to be readily available to parents and teachers of the
Silverhill Primary, in Mickleover, which was shut for eight
weeks in 2004 after asbestos was found during routine building

The National Association of Schoolmasters: Union of Women
Teachers says it has asked Derby City Council to make the
results of the internal investigation public. The new Freedom of
Information Act, which came into force on New Year's Day, means
the local authority has to consider that request.

Dave Wilkinson from the union said, "It looks as if the council
is trying to sit on a report which it might find unwelcome. Why
can't the council come clean?"

So far, only senior councilors have been able to see the results
of the internal report, but the NASUWT said it has asked the
council's chief executive Ray Cowlishaw to publish the findings.
But Mr. Cowlishaw said he would wait for the conclusions of a
separate Health and Safety investigation before anything is made

A previous edition of the Class Action Reporter that came out on
Sept. 24, 2004 revealed that the school's headteacher had been
suspended after the three-month closure. GBP750,000 had been
spent for the decontamination after asbestos was discovered last
March. Independent experts had said health risks to children and
staff had been minimal.

ASBESTOS LITIGATION: Exposure Causes Autoimmune Diseases, Study
A breakthrough study reveals that exposure to asbestos may lead
to future autoimmune diseases, according to the January issue of
the peer-reviewed journal Environmental Health Perspectives.

Researchers evaluated 50 residents from Libby, Montana, a town
highly exposed to asbestos fibers, and found them much more
likely to have a class of autoantibodies in their blood than a
control group. Exposure to toxic amphibole asbestos may
contribute to autoimmunity, potentially laying the groundwork
for diseases such as rheumatoid arthritis and multiple
sclerosis. Presence of these biological markers, known as
antinuclear antibodies (ANAs), are often found in people whose
immune systems may be predisposed to cause inflammation against
their own body tissues.

Researchers found that ANAs occurred 28.6% more frequently in
the Libby samples than in the controls. In addition, people who
had been exposed to asbestos for more than five years tended to
have higher concentrations of ANAs than those with less
exposure. Of the Libby residents tested, 76% had asbestos-
related lung problems, and those with more severe lung problems
also had higher concentrations of autoantibodies.

The town of Libby was designated a Superfund National Priorities
List site in 2002, after decades of mining vermiculite
contaminated the town with amphibole asbestos, known to be
extremely toxic and believed to be responsible for the unusually
high number of asbestosis and mesothelioma deaths in the area.

"By demonstrating an association between asbestos exposure and
measures of autoimmune responses, this study supports and
augments other existing evidence that, like silica, asbestos is
an agent of systemic autoimmunity," wrote the study authors.

"Asbestos-contaminated vermiculite from Libby has been shipped
and processed in many sites in the United States, and this
material is still used in many applications.

"It therefore remains a significant health risk to humans both
occupationally and environmentally, and an awareness of an
association with autoimmunity could impact necessary monitoring,
testing, and treatment regimens for exposed individuals or

Based on the results of this relatively small-scale study, the
researchers intend to continue their studies of actual
autoimmune diseases among the Libby population, which depended
for years on the jobs at the W.R. Grace vermiculite mine.

"Asbestos exposure has long been associated with cancers,
fibrosis, and other diseases, but the link between subclinical
markers of autoimmune disease and asbestos exposure is important
information," says Dr. Jim Burkhart, science editor for EHP.

The authors of the study were Jean C. Pfau, Jami J. Sentissi,
Greg Weller, and Elizabeth A. Putnam of the Center for
Environmental Health Sciences at the University of Montana. The
article is available free of charge at

ASBESTOS LITIGATION: ABB Sees No Major Change In Claims Amount
Switzerland-based engineering and automation company ABB Ltd.
(NYSE: ABB) said last Tuesday it doesn't expect its proposed
US$1.2 billion asbestos claims settlement to be increased

"We don't expect a significant change in the settlement amount,"
ABB spokesman Wolfram Eberhardt said, reacting to news that U.S.
oil services company Halliburton Co. (NYSE: HAL) has completed a
US$5.1 billion settlement to free itself from asbestos

The ABB spokesman said the Halliburton settlement may be an
indication that the mood towards companies with asbestos
problems is improving. He said the finalization of Halliburton's
settlement did not substantially change ABB's asbestos
situation, but did improve sentiment.

ABB's shares rose as the Halliburton news raised hopes ABB could
resolve its asbestos issue swiftly.

Last Dec. 10, the Class Action Reporter divulged that ABB would
probably have to revise its bankruptcy plan after a federal
appeals court questioned the plan's fairness to certain classes
of asbestos injury claimants. At that time, many analysts said
that the company's new legal dealings could result in additional
costs between US$500 million and US$2 billion.

The rejection of the proposal by the Third Circuit Court of
Appeals in Philadelphia, with which ABB hoped to settle more
than 100,000 pending asbestos lawsuits, came as a surprise since
two lower courts had already confirmed the plan. This proved to
be a major setback to the firm, which had hoped the deal would
end years of legal struggles and put a cap on asbestos claims
filed by thousands of former U.S. workers.

The engineering firm's stock had fallen sharply after the
court's unexpected rejection of its asbestos plan as investors
worried about extra costs and an increased settlement price. But
ABB's management moved quickly to calm such fears, saying the
issues raised by the court would be resolved within months and
without significant additional costs.

ABB has since asked the court to reconsider parts of the ruling
that dealt with the inclusion of two U.S. divisions, Lummus and
Basic, in its plan for its Combustion Engineering unit to ring-
fence asbestos claims for all three subsidiaries.

The court also wanted a closer look into whether ABB's plans
treated all claimants equally, saying that some who went along
with the plan at an early stage seemed to have received higher
compensation than those who settled at a later stage.

"We have elected for now not to request reconsideration of the
other portions of the decision. We remain confident that we can
address the concerns of the court adequately to successfully
finalize Combustion Engineering's bankruptcy plan," ABB said.

The Company, which operates through two major divisions - power
technologies and automation technologies - had hoped the deal
would end years of legal wrangling and put a cap on asbestos
claims filed more than 100,000 former U.S. workers.

Steven Kazan, a lawyer representing a number of claimants, had
said that ABB may face between US$800 million and US$2 billion
in extra costs, on top of the US$1.2 billion it already put into
a claims fund.

However, ABB's U.S. lawyer David Bernick has said these numbers
were far too high.

ASBESTOS LITIGATION: Asbestos in UK Schools Still Under Scrutiny
Sixteen schools identified as having asbestos in classrooms or
other parts of their premises have yet to have the hazardous
substance removed but it was revealed that as many as 138
secondary schools in the Province are in a similar position,
according to figures released by the Department of Education.

GBP4.5 million has been made available to Education Boards for
surveys and preparations for the introduction of new asbestos
regulations. A further GBP3.8 million has been set aside for
removal, decontamination work or repairs should surveys deem
asbestos removal necessary in instances where it is found to be
in poor condition or at risk of being disturbed.

The Department has written to all Boards instructing them to
complete surveys as soon as possible.

A spokesman for the North Eastern Education and Library Board
said a full management asbestos program was underway and
proceeding on schedule. He stressed that measures were being
undertaken to ensure pupils, staff or members of the public were
not at risk in any of its properties. "The Board has employed
three specialist contractors to survey all the properties in the
area in relation to asbestos," he said.

Of the 344 premises, which include nursery, primary, secondary
and special schools, libraries and youth facilities, 221 have so
far been surveyed. The remaining buildings will be completed by
February, when the survey contracts are due to end.

"No one is at risk from asbestos as long as it is managed
properly and the Board works closely with the Health and Safety
Executive to ensure there is no risk to pupils, staff or the
public," he said.

It was recently revealed that only 110 surveys had been carried
out in the 138 schools identified in the Province as having

ASBESTOS LITIGATION: FPB Warns Local Firms to Comply with Plan
The Forum of Private Businesses is warning firms in West
Lancashire they could be heavily fined if they fail to properly
implement an Asbestos Management Plan.

Major changes to the Health and Safety law came into force six
months ago and it is expected the Health and Safety Executive
will begin to crack down on businesses that have failed to
adequately comply.

FPB chief executive, Nick Goulding, said, "The HSE will expect
businesses to have found out if their premises contain

The asbestos regulations cover all non-domestic buildings,
whatever type of business is carried out in them, plus common
areas of residential rented properties including halls,
stairwells, lift shafts and roofs.

"If your business occupies a building, whether you own it or
not, you are responsible for maintaining and repairing it," Mr.
Goulding added.

A fact sheet is available at www.fpb.org and is free to members.
Non-members can contact FPB's Member Information Services on
01565 626001.

ASBESTOS LITIGATION: Assurant Cites Continued Exposure to Claims
Assurant Inc. (NYSE: AIZ), which provides a range of specialty
insurance products, reported to the Securities and Exchange
Commission that it remains to have exposure to asbestos,
environmental and other general liability claims arising from
its participation in various reinsurance pools from 1971 through

This exposure arose from a short duration contract that the
Company discontinued writing many years ago. It carried case
reserves for these liabilities as recommended by the various
pool managers and bulk reserves for IBNR of US$37 million
(before reinsurance) and US$36 million (after reinsurance) in
the aggregate at December 31, 2003. Any estimation of these
liabilities is subject to greater than normal variation and
uncertainty due to the general lack of sufficiently detailed
data, reporting delays and absence of a generally accepted
actuarial methodology for those exposures.

There are significant unresolved industry legal issues,
including such items as whether coverage exists and what
constitutes an occurrence. In addition, the determination of
ultimate damages and the final allocation of losses to
financially responsible parties are highly uncertain. However,
based on information currently available, and after
consideration of the reserves reflected in the financial
statements, the Company believes that any changes in reserve
estimates for these claims are not reasonably likely to be

Asbestos, environmental and other general liability claim
payments, net of reinsurance recoveries, were US$2.9 million,
US$1.4 million and US$2.2 million for the years ended December
31, 2003, 2002 and 2001, respectively.

The Company's Property and Warranty line of business includes
creditor-placed homeowners, manufactured housing homeowners,
credit property, credit unemployment and warranty insurance and
some longer-tail coverages (e.g., asbestos, environmental, other
general liability and personal accident).

ASBESTOS LITIGATION: Expert Recommends Fingerprint Asbestos Test
To indicate the location of asbestos inside the building, a
consultant hired by the Brookfield school system is suggesting a
fingerprint analysis at both Center Elementary School and
Whisconier Middle School.

Dust samples will be compared with other asbestos samples
compiled in a database that show a general location, such as
flooring or roofing, said district consultant Dr. Mark Granville
of Brooks Laboratories. He said that this activity would
effectively aid in dealing with asbestos in the school system.

Last Dec. 16, Dr. Granville had met with Superintendent John
Goetz and board of education members. Earlier this week at the
facilities committee meeting, chairman Rob Gianazza presented a
draft of all of Dr. Granville's recommendations. Along with
fingerprint analysis, the recommendations included:

(1) Hold off on dust testing until the state issues its report
on the use of dust testing to assess asbestos contamination in a
building and that report is accepted by the Department of

(2) Continue to follow the asbestos management plan until able
to remove all known sources of building materials that contain

(3) Keep floor tiles covered with area runners in the B wing of
the middle school in the vicinity of the walkway to the portable
classrooms. Abate/remove the tiles during the summer of 2005;

(4) Present to the town a plan for the removal of all known
sources of building materials containing asbestos in all

Dr. Granville added that there is no imminent danger and no need
to do anything on an emergency basis.

In the fall, a group of 18 parents circulated a petition asking
the board to conduct micro-dust vacuuming and to allow parents
to pay for fingerprinting analysis. At a previous facilities
committee meeting, members did not consider bringing the
petition before the full board, saying that parents should not
bear the responsibility of paying for testing.

Kathy Rossland-Hulce, one of the parents who has been a
proponent of asbestos testing, said she still plans to be
vigilant to make sure the recommendations are followed. She
still wants to hear Dr. Granville's comments for herself at the
board of education meeting.

If the district decides to do the fingerprint analysis, Brooks
Laboratory would conduct the analysis in conjunction with
asbestos researcher Dr. James Millett of Georgia.

A motion was also unanimously passed to go before the full board
with a recommendation on partial abatement at Whisconier Middle
School. The partial abatement will allow a portion of the back
hallway to be closed off and tiles removed. The tiles are
suspected of harboring asbestos dust, which was found wafting
into the new wing of the school.

If approved, the partial abatement will take about five weeks
and about US$30,000 to remove old, loose tiles. A sealer would
be put down on the bare concrete floor. The work would be done
in the summer.

ASBESTOS ALERT: Fears of Asbestos Release Arise After House Fire
A fire gutted the Great Bay Road, St. David's residence occupied
by a senior citizen and her three grandchildren last Tuesday.
But the Fire Service said they had "serious concerns" for the
family's safety after breathing smoke from the asbestos sheet
roof, which was consumed by the kitchen fire.

The home's owner, Chesleigh Oscar Foggo, was thankful that his
wife Thelma and three grandchildren were able to get out in
time. Mr. Foggo was on the property but not in the building when
the fire started. Neighbors tried to form a chain of water
buckets when they saw the flames, but the heat and smoke became

Apparently, the fire started in the kitchen where Mr. Foggo had
recently bought a gas stove. "Its one of those things you read
about or see on TV and think, that will never happen to me. You
don't realize it could happen to you. I just thank the Good
Lord, they are all safe. I can always build a new house, or buy
new clothes. The most important part is no life was lost."

Speaking at the scene as his team continued to battle the blaze,
Divisional Officer Anthony Caisey said the Bermuda Fire Service
received a call at 3:10 p.m. "The first Fire Personnel to arrive
were from Clearwater Station who found the fire in the home
fairly involved as the fire was through the roof," he said.

Officer Caisey said Fire Personnel were not able to enter the
home at first as the fire caused the roof to collapse, spreading
the flames to the four other rooms in the home. "We will
concentrate our efforts there [kitchen area] in going to get the
information we need for our assessment."

Regarding the smoke from the burning asbestos slate roof, he
said, "The roof was a serious concern because it was asbestos.
We didn't want people downwind and were concerned about family
members breathing the smoke that contained asbestos dust. At the
moment there is a fairly steady breeze taking the smoke away
from the immediate area."

Old wooden homes common to St. David's "were built prior to
building code regulations," he said. And he said he would prefer
it if old Bermuda homes with asbestos sheet roofs were modified
to more acceptable levels.

ASBESTOS ALERT: NC City Tests Show High Levels in Drinking Water
After routine testing of its drinking water revealed asbestos
levels exceeding acceptable standards, Kinston City in North
Carolina will be holding more frequent tests of its water

Last November, four water samples were taken. The one taken Nov.
30 contained an asbestos level of 29.3 million fibers per liter,
or about four times the state's standard of below 7 million
fibers per liter. Three other samples were less than one-seventh
of the standard.

Notices will be sent out in the next utility bills explaining
about the asbestos in their drinking water and what is being
done to remedy the problem. It would emphasize that the water is
safe to drink without any additional treatment by the city or
the customer.

"Although high levels of asbestos in your water system is not
good, it is not an immediate health risk," said Scott Stevens,
Kinston's director of public services.

"Studies have shown that asbestos levels in drinking water above
seven over many years can lead to an increased risk of
developing benign intestinal polyps, so it is important that we
determine if this is a short-term abnormality in our water
system or a more significant long-term problem," he said.

Asbestos cement pipe used in the water distribution system is
the likely cause of the unusually high asbestos reading, Kinston
City Council members were told. This type of pipe was used for
water lines in many systems until the mid-1980s, he said, and
there is about 19 miles, or 10 percent of the city's water main,
that is made up of this material.

Mr. Stevens said that if asbestos levels continue to increase,
some of the cement pipes making up the city's distribution
system may have to be replaced, or additional water treatment
might be needed if the asbestos is naturally occurring from
ground and surface water.

The state has only required the city to test for the substance
every nine years but once a level of asbestos exceeds the state
standard, the state requires testing every quarter. The city
however intends to test monthly for the first quarter. The first
retest was on Dec. 20, and all of the samples contained levels
of asbestos well within state requirements.

Fred Hill, regional engineer for the public water supply section
of the state Department of Environment and Natural Resources,
described Kinston's asbestos situation as "a cause for concern,
but not alarm." He said the high reading was unusual and
probably just a one-time incident.

ASBESTOS ALERT: Builder of Site Over Dump Files for Bankruptcy
A developer being sued over building a Klamath Falls subdivision
on an old asbestos dump has filed for federal bankruptcy
protection. The subdivision is the subject of a U.S.
Environmental Protection Agency cleanup of asbestos-laden
material from a World War II-era Marine Corps barracks that once
stood on the land.

MBK Partnership, which developed the 52-acre North Ridge
Estates, filed for Chapter 11 protection last month in U.S.
Bankruptcy Court in Eugene, according to court records. The move
by MBK Partnership and its principal, Mel Stewart, effectively
halts a federal lawsuit brought by 13 families in North Ridge
Estates that claim the partnership knew of the buried waste but
failed to tell buyers. The lawsuit seeks US$6 million in
property losses and more than US$14 million in other losses.

In its bankruptcy filing, MBK Partnership says it has US$1
million to US$10 million in assets and faces about the same
amount of debts.

An expert for some homeowners has said cleaning up the
subdivision could cost as much as US$20 million. Klamath County
officials have in the past valued the North Ridge Estates
properties at about US$6 million.

MBK attorney David A. Foraker said the filing came after the
partnership concluded it could not reach a fair settlement with
the homeowners who have brought the lawsuit. He said the
bankruptcy case will instead allow the partnership to reach a
unified settlement of claims from all North Ridge Estates
property owners.

"We think it makes more sense to use the resources the
partnership has to address all the environmental problems,
rather than take it piecemeal and not have enough money to clean
up the mess," Mr. Foraker said.

Tom Lindley, a Portland attorney representing the 13 families
that sued, called the bankruptcy filing a delaying tactic,
halting plans to begin taking a deposition from MBK partner
Melvin Stewart. "It is clearly intended to be one more effort by
the defendants to delay or stop this case from getting to the
jury," Mr. Lindley said.

Homeowners at the 33-lot subdivision discovered in 2001 the
buried debris from razed buildings, raising concerns about their
exposure to asbestos fibers.

If inhaled, the fibers can cause scarring of the lungs and even
cancer. The Oregon Department of Human Services has concluded
that North Ridge Estates is a "past and present public health
hazard." No North Ridge Estate resident has claimed health
damage from living at the site. Residents have been told to
limit their outdoors activity in the wooded subdivision.

MBK Partnership has denied any wrongdoing in the development.
The partnership has claimed in court that the federal government
and the state of Oregon share in the liability for the cleanup
costs as former owners of the site.

ASBESTOS ALERT: Widow Faces Red Tape Woes in Claim Attempts
A widow whose husband died of an asbestos-related illness is
furious of the red tape wrangle she has faced in trying to get

Patricia Withers, aged 64, of Sendall Road, North Walsham, said
efforts to pursue claims against both her late husband's
employer and the Government have led her nowhere.

Mr. Withers died in June 2002 at the age of 61 from malignant
mesothelioma after being exposed to asbestos during his working
life. He died 18 months after he was diagnosed with the illness.
An inquest into his death determined he had died from industrial

Mrs. Withers has now instructed the Sheffield-based solicitors
Irwin Mitchell to sue the driving firm Lawrence Brothers
(Transport Ltd) in London where Mr. Withers had worked as a
lorry driver in the 1960s. Part of her late husband's work
included transporting sacks of white asbestos. But the driving
firm was dissolved in 1978 and unless it is found to have had
employee liability cover, and the insurance Company is traced,
she is unlikely to get compensation.

She says she is devastated, distressed and exhausted by her
experience and upset that no one will take responsibility for
what has happened. She said, "I am now getting angry. Thomas was
my soul mate. We were married nearly 40 years and had never been
apart. I think somebody should be accountable. It's not about
money, but it's been two years now."

She has therefore put in a posthumous claim for dust-related
diseases to the Government under the pneumoconiosis (workers'
compensation) scheme. It pays out compensation to victims or
dependents of certain industrial diseases caused by dust who do
not have employers to pursue.

But she has faced endless bureaucracy there and been told she
should have applied during his life or sooner after his death.
"As my husband got ill I was so distraught. I was more
interested in making sure he had a decent day than making a
claim." She said that to add to her infuriation, she had also
been told that pertinent paperwork was lost.

If successful she will only get about GBP6,000 from the
Government, which is at least 10 times less than she would have
got through an industrial claim.

While her husband was alive, she received industrial injuries
disablement benefit but once he had died, this stopped.

Adrian Budgen, head of the asbestos disease unit at Irwin
Mitchell, said insurers were not obliged to admit if they had
insurance for a Company that had used asbestos. "I don't want to
raise Mrs. Wither's hopes," he said. "The procedure is not at
all straightforward."

ASBESTOS ALERT: Inquest Reveals Pipe Fitter Died from Asbestos
An inquest heard that an Ellesmere Port man suffered from severe
breathing and mobility problems in his last few years due to
working with asbestos in the 1950s.

Frank Dagnall Kilshaw, aged 90, of Don Walk, died on Dec. 3,
2003 at the Countess of Chester Hospital, leaving his wife of 63
years, Gladys, and two sons.

Mr. Kilshaw had met his wife at Shell, where he worked in the
can factory making fuel cans for the armed forces, and as a pipe
fitter, from 1947 to 1963. His son, Frank Thomas Kilshaw, told
the inquest how his father had worked in confined conditions,
breaking off asbestos from pipes, with no protective gear.

Mrs. Kilshaw, aged 83, told the coroner he had been taken to the
hospital in 1999 after he became short of breath at his younger
son's home in Jersey. Mrs. Kilshaw said that his health had
declined from then on.

He had eventually had to use oxygen canisters and a wheelchair,
but had been going through too many canisters. Mrs. Kilshaw
added that he became housebound in the last few years of his
life. He passed away after being in the Countess of Chester
Hospital for four-and-a-half weeks.

Deputy coroner for Cheshire, Dr. Janet Napier, said, "Mr.
Kilshaw managed to work hard all his life in quite nasty
conditions. He was in very difficult works conditions, but he
had quite a happy retirement, and was happy for those 63 years."

A post-mortem examination showed that he had pulmonary fibrosis,
and chronic pulmonary obstructive disease. It concluded that he
died of asbestosis. She recorded a verdict that Mr. Kilshaw died
from industrial disease.

ASBESTOS ALERT: Secondary Exposure Claims Life of Plumber's Wife
A wife of a plumber in Pentrebach died of cancer after suffering
from an asbestos-related illness after years of breathing in
asbestos as she washed her husband's overalls.

Cheryl Williams laundered husband Roger's three pairs overalls
alternatively throughout the whole week. But by shaking dust off
before washing them, she inhaled the carcinogenic asbestos
fibers. Mrs. Williams was 52 when she died on July 31 last year.

At the inquest, Mr. Williams, who is now retired, said he was
not warned that working as a plumber would bring him into
contact with asbestos. He had worked on the construction of the
Prince Charles Hospital in Merthyr Tydfil in the early 1970s.

"They never told us anything at all about asbestos," he said. "I
worked on the Prince Charles for two to three years. I have
always been a plumber, but only on domestic jobs after that."

Mr. Williams said asbestos was used to fill holes and cracks in
the walls and ceilings while the hospital was being built. He
says that the asbestos was sprayed on so it was caught

In a statement read to Merthyr Tydfil coroners court, Mr.
Williams said, "At no time was I warned about working in close
proximity to asbestos," he said.

Consultant pathologist at Prince Charles Hospital, Sam Kiberu,
said cancer had spread throughout her body. During the post
mortem examination, he found that cancerous cells had virtually
encased the aorta of the heart and spread to the right lung. Her
left lung was removed in an operation in 2002 to stop the cancer
growing. But it had continued to spread to other organs. Dr.
Kiberu said she also showed signs of heart failure.

He said although no asbestos was found during the post mortem,
this did not mean it was not the cause of Mrs. Williams's
cancer. She died of a mesothelioma - a lung cancer that is
overwhelmingly caused by exposure to asbestos. Only 30% of cases
are caused by other factors.

Recording a verdict of accidental death, coroner Philip Walters
gave the cause of death as disseminated malignant mesothelioma
due to asbestos exposure. He said, "On the balance of
probabilities the asbestos exposure would have caused the

Dr. Kiberu said, "This does happen quite often. That was not
recognized at the beginning, but now it's another example of
something like passive smoking. A lot of housewives who are
married to people working with asbestos get exposure by handling
their clothes."

A High Court ruling is expected which will settle if
compensation claims can be made for asbestos injuries. In a
landmark case, insurance companies have challenged claims by
people with pleural plaques, scars on the lungs caused by
breathing in asbestos.

ASBESTOS ALERT: Royal Navy Man Died Due to Asbestos Exposure
Norwich-born Arthur Webster, a former Royal Navy man, has died
from cancer brought by his exposure to asbestos during his years
in service from 1946 to 1952. It is believed that he breathed in
the asbestos dust while making insulating paste, one of his
regular tasks. Mr. Webster, a great-grandfather aged 75, was one
of three people from Norfolk who have died in the last few weeks
from asbestos-related diseases.

His widow Bernice, aged 73, said having to watch her husband of
54 years die a slow death had been terrible for the whole
family. She said that her husband experienced extreme difficulty
in breathing. Chemotherapy was even tried at one point but after
three times was stopped since it did not help at all.

His widow said Mr. Webster, who was also a former post office
inspector, had never been bitter about developing the disease.
Following his death at the Norfolk and Norwich University
Hospital on November 14, a post mortem revealed that he had died
from a form of asbestosis.

Norwich coroner William Armstrong recorded a verdict of death by
industrial disease. "Clearly he died from a condition brought
about by his exposure to asbestos many years ago at a time when
the dangers of asbestos were not as widely known as they are
now," he said.

ASBESTOS ALERT: Standard Telephone Ex-worker Files GBP150T Claim
A former telephone company worker is seeking compensation worth
GBP150,000 after being afflicted with what he claims is an
asbestos-related illness.

Ray Thomas, of Long Road, Lowestoft, has issued a High Court
writ against his former employers Standard Telephone Cables, of
Sidcup, Kent. Mr. Thomas believes he was exposed to asbestos
dust and fibers while he worked for the firm.

Mr. Thomas blames his condition on the firm's alleged
negligence. He also alleges breach of contract and breach of
statutory duty.

No one from Standard Telephone Cables was immediately available
for comment.

ASBESTOS ALERT: Widow Sues BAE Systems, British Aircraft Corp.
A widow whose husband died from asbestos-related cancer has
launched a high court battle against his former employers,
British Aircraft Corporation and defense giant BAE Systems. She
is seeking an unspecified sum, expected to be more than

Shirley Reed, aged 69, of South Shore, Blackpool, is accusing
the companies of negligence in failing to protect her husband
from asbestos dust, failing to warn him of the risks, failing to
provide a safe workplace and exposing him to a foreseeable risk.

Graham Reed died in 2002 at the age of 65 on February 27, 2002
after contracting malignant mesothelioma. He spent all his
working life apart from a gap of about 15 years at BAE's Warton
site. He had retired in 1993 from his job as a senior foreman on
the Tornado production line.

According to the writ issued at London's High Court, Mr. Reed
worked for British Aircraft's predecessor English Electric
Company between 1959 and 1961 and was in direct contact with
asbestos lagged pipes as he built and serviced Lightning
aircraft in Hangar 31. The writ says he inhaled deadly asbestos
dust and fibers and worked alongside those removing lagging,
without personal protection. It is alleged asbestos was widely
used in the aircraft industry.

Aside from his widow Shirley, he left a son Martyn, aged 44, who
also works at BAE Warton, a daughter Tracy Clayton, aged 37, and
three grandchildren. Ms. Tracy said, "He had complained of chest
and rib pains for the best part of two years before he was
diagnosed. It is heartbreaking to hear a doctor tell your dad
that there is nothing they can do for him."

A spokeswoman for BAE Systems said, "As this matter is in the
hands of our legal advisors, we feel it would not be appropriate
for BAE Systems to comment at this stage. Our thoughts are with
the family."

Company Profile:

BAE SYSTEMS plc (London: BA)
Warwick House, PO Box 87, Farnborough Aerospace Center
Hampshire GU14 6YU, United Kingdom
Phone: +44-1252 373232
Fax: +44-1252 383000

Fiscal Year-End December
2003 Sales (mil.)   : GBP8,384.6
1-Year Sales Growth   : 15.1%
2003 Net Income (mil.)   : GBP6.0
2003 Employees    : 68,400

BAE Systems is an international Company engaged in the
development, delivery and support of advanced defense and
aerospace systems in the air, on land, at sea and in space. The
Company designs, manufactures and supports military aircraft,
surface ships, submarines, fighting vehicles, radar, avionics,
communications, electronics and guided weapon systems.

Company Profile:
British Aircraft Corporation
Farnborough, Hampshire

The British Aircraft Corporation, or BAC, is a British aircraft
manufacturer, formed from the forced merger of the Bristol
Aeroplane Company, English Electric, Vickers-Armstrong and
Hunting in 1959. Most of the BAC designs were taken over from
the individual companies that formed it. Later consolidation in
the aerospace industry resulted in the Company merging into
British Aerospace in 1977.

ASBESTOS ALERT: GA Supreme Court Denies John Crane Inc.'s Appeal
The Supreme Court of Georgia last Dec. 9 denied an appeal filed
by packing Company John Crane Inc. that sought to reverse the
US$1,975,000 verdict of the trial court. The ruling came about
as a result of a claim for compensation arising from exposure to
asbestos products, which caused an employee's death. The trial
court also denied John Crane's motions for judgment
notwithstanding the verdict and for new trial.

Court records show that in 1996, Robert H. Jones filed a
negligence and product liability action against John Crane and
seven other corporate defendants alleging that he contracted
mesothelioma because of occupational exposure to asbestos dust
from products manufactured by the defendants.

After Mr. Jones's death in 1997, his wife and executrix of his
estate, Laila A. Jones, was substituted as plaintiff. She
amended the complaint to add claims of wrongful death and loss
of consortium. All defendants but John Crane were either
dismissed from the suit or filed for bankruptcy prior to trial.

John Crane appealed to the Court of Appeals, arguing that the
trial court erred in refusing to charge the jury that Mr. Jones
could not recover unless her husband's exposure to its products
was a "substantial contributing factor" to his injuries.

The Company argues that the Court of Appeals erred in its
conclusion because the "substantial factor" formulation is
consistent with Georgia law, has been widely accepted throughout
the country, and is justified by public policy considerations.

The Supreme Court held that showing that the supplier's asbestos
was the "significant" contributing factor in employee's death
was not required. The jury was only required to consider whether
supplier's negligence was contributing factor.

Contrary to John Crane's contention, requiring that its
contribution to the resulting injury be "substantial" is not in
accord with the longstanding law of Georgia.

Company Profile:

John Crane Inc.
6400 W. Oakton St.
Morton Grove, IL 60053-2725
Phone: 847-967-2400
Fax: 847-967-3915
Toll Free: 800-732-5464

Fiscal Year-End    : July
2003 Sales (mil.)   : GBP444.9
1-Year Sales Growth   : 1.2%

John Crane, a subsidiary of the UK's Smiths Group plc,
manufactures seals, packings, lubrication systems and couplings.
The Company serves the oil and gas, pharmaceutical, chemical,
automotive, Food and Beverage, and power generations industries,
among others. It has a workforce of over 6000 people in 47

ASBESTOS ALERT: Court Dismisses Leggett & Platt Worker's Claim
The Court of Appeals of Ohio last Dec. 15 dismissed an appeal of
a former employee of Leggett & Platt, Inc., who filed a claim
for workers' compensation alleging that he contracted asbestosis
as a result of his employment.

This issue with Case No. 04CA008466 is represented by Anthony L.
Ania, for the appellant, Mr. Denzil Wright. Lawrence C. Davison,
Patrick J. Krebs, and Timothy McGrail are representing Leggett &

On March 31, 2003, a district hearing officer denied Mr.
Wright's claim finding that there was insufficient evidence to
establish his asbestos-related disease and its causal connection
to his employment. He then appealed that denial to a staff
hearing officer.

On May 30, 2003, the staff hearing officer vacated the decision
of the district hearing officer and dismissed the claim due to a
failure to provide evidentiary materials required by Industrial
Commission Resolution 96-1-01. This resolution requires that
claimants seeking compensation for asbestosis must provide x-
rays interpreted by a "B reader," pulmonary functions studies
interpreted by a physician, and evidence presented by a
physician of the causal connection between exposure and the
disease. Mr. Wright was only able to provide the x-rays.

The Industrial Commission declined to hear his appeal. On August
22, 2003, he filed a notice of appeal in the Lorain County Court
of Common pleas.

On Jan. 9, 2004, Leggett & Platt moved to have Mr. Wright's
appeal dismissed on the ground that he failed to exhaust his
administrative remedies. The following month, the trial court
dismissed the appeal finding that it lacked subject matter
jurisdiction because the dismissal of the claim was not a final
order and was therefore unappealable.

This Court disagrees with all of Mr. Wright's contentions that
blunders were made when his appeals got dismissed. The Court
affirms the judgments handed down and considers these
contentions as lacking merit.

Company Profile:

Leggett & Platt, Incorporated (NYSE: LEG)
No.1 Leggett Rd.
Carthage, MO 64836
Phone: 417-358-8131
Fax: 417-358-5840

Fiscal Year-End    : December
2003 Sales (mil.)   : GBP2,467.5
1-Year Sales Growth   : 2.7%
2003 Net Income (mil.)   : GBP115.8
1-Year Net Income Growth  : (11.7%)
2003 Employees    : 33,000

Leggett & Platt is a diversified manufacturer that conceives,
designs and produces a broad variety of engineered components
and products for customers worldwide. It's best known as the
pioneer of coiled bedsprings. The Company makes components for
bedding and chairs, furnishings, and die-cast products. Leggett
& Platt also produces industrial materials and specialized items
such as quilting machinery. Customers include furniture
retailers and manufacturers of automobiles, construction-related
products, furniture and bedding, and garden and yard equipment.

ASBESTOS ALERT: TX Appeals Court Upholds Ruling V. Borg-Warner
The Court of Appeals of Texas last Dec. 16 rejected a plea to
overturn a ruling that found Borg-Warner liable for negligence
and strict liability in the case filed by former employee,
Arturo Flores. The Court also found that Borg-Warner acted with
malice and awarded US$50,000 in punitive damages, in addition to
US$103,200 in compensatory damages.

Borg-Warner Corp., now known as Burns International Services
Corp., filed the appeal tagged as Case No. 13-03-058-CV before
Chief Justice Valdez and Justices Yanez and Garza. The Company
intended to reverse the decision made by the 319th District
Court of Nueces County, Texas. Elizabeth L. Phifer represented
Borg-Warner and Scott W. Wert was Counsel for Mr. Flores.

Mr. Flores, a mechanic who was an employee from 1964 to 2001,
sued his former employer for damages arising from his exposure
to the asbestos-containing brake pads it manufactured. From 1972
to 1975, his task consisted of grinding new brake pads prior to
installation, a process necessary to minimize "brake squealing."
The process produced visible dust, which Mr. Flores inhaled.
Those brake pads reportedly contained between seven and 28%
asbestos by weight.

In 1998, Mr. Flores was diagnosed with asbestosis. During the
hearings, Dr. Castleman testified that brake mechanics can be
exposed to "respirable asbestos fibers." Another expert, Dr.
Bukowski testified, "Brake dust can cause asbestosis."

The Company argued that the evidence was legally insufficient to
prove negligence. Ms. Phifer cited that there was no evidence
that asbestos fibers were released from its brake pads and thus,
no evidence that its brake pads injured Mr. Flores. However, the
Court overruled the argument, citing that in the context of
asbestos-related claims, if there is sufficient evidence that
the defendant supplied any of the asbestos to which the
plaintiff was exposed, then the plaintiff has met the burden of

The Company also asserted that there was no evidence to show
that use of its brake pads posed an extreme risk of harm. But
medical and scientific literature dating as far back as 1898
published in the United States, Great Britain, and Germany
documented the dangers of asbestos dust. According to Dr.
Castleman, between 1950 and 1968, hundreds of articles were
published on the health hazards of asbestos. These articles
emphasized the dangers faced by employees, including brake
mechanics, who worked with asbestos materials. As a manufacturer
of asbestos products, the Court assumed that Borg-Warner had
such knowledge.

Another issue that the Court commented on was that the Company
never placed any warnings on its brake pads. Due to these
reasons, among others, the Court of Appeals affirmed the
judgment of the trial court.

Company Profile:

BorgWarner Inc. (NYSE: BWA)
200 South Michigan Ave
Chicago, IL 60604
Phone: 312-322-8500
Fax: 312-322-8599

Employees                  :          14,300
Revenue                    : US$ 3,070,000,000.00
Net Income                 : US$   174,900,000.00
(As of December 31, 2003)

BorgWarner Inc. (formerly Borg-Warner Automotive) is a leading
maker of power train products for the world's major automakers.
Its largest customers -- Ford, DaimlerChrysler, and General
Motors -- together account for more than 50% of sales.  Its
power train products include four-wheel-drive and all-wheel-
drive transfer cases (primarily for light trucks and sport
utility vehicles), as well as automatic transmission and timing
chain systems.  BorgWarner has 43 facilities in 14 countries.

ASBESTOS ALERT: DEP Warns 3 FL Contractors for Skipping Surveys
The Florida Department of Environmental Protection has warned
the owners of three businesses, which assisted in the rebuilding
effort after Hurricane Charley, that they may have violated
asbestos-control regulations when they demolished the buildings.

The agency cited Punta Gorda's Holiday Inn, Morton's Ace
Hardware and the Harbour Inn in Charlotte Harbor. It was
revealed that some inspectors skipped the requirement to get
surveys for the presence of asbestos before taking the buildings

King Excavating, the demolition contractor working at Morton's,
has already paid US$3,750 in penalties to resolve the matter.
The DEP did not find asbestos products in the rubble, but there
was no survey administered beforehand.

Three other cases, including the two hotels, have yet to be
resolved, said agency spokeswoman Lisa Douglass. She said, "Out
of protection for people in the neighboring areas, we want to
get to the bottom of it."

Of the four warning letters issued by DEP to Charlotte
businesses, only the Holiday Inn states that asbestos products
were found. A Nov. 29 warning letter states that efforts to
salvage copper tubing and other materials before the hotel
demolition disturbed walls and sprayed-on ceilings containing

Ms. Douglass said the owners claim that looters were responsible
for the salvage work.

After getting a survey, contractors must take steps to remove
asbestos products safely. Normally, contractors must give DEP 10
days' notice before knocking down commercial or multi-family
buildings. But during the state of emergency, the DEP waived the
10-day notice requirements for storm-damaged structures. Some
contractors may have taken advantage of the drop in oversight.

Attorney Geri Waksler, whose family owns Morton's Hardware, said
they weren't aware of the asbestos-control requirements. When
the county issued a demolition permit for the site, there was no
mention of it.

County Building Official Jim Evetts said that in the commotion
after the hurricane, some staffers may have forgotten to give
checklists reminding people that they needed surveys. He said,
"I'm sure it was one of those things that slipped by people."

Mr. Evetts said homes built after 1980 are unlikely to have any
asbestos in them. Asbestos products are more common in
commercial buildings. Asbestos isn't as prevalent in Florida,
where many buildings are often poorly insulated, he said.

Company Profile:

King Excavating Inc
3508 Tamiami Trl
Port Charlotte, FL 33952
Phone: (941) 625-9550

ASBESTOS ALERT: Water Pik Technologies Faces Asbestos Lawsuits
Water Pik Technologies Inc. (NYSE: PIK), a leading provider of
personal health care products, pool products and heating
systems, reports in its latest filing to the Securities and
Exchange Commission that the Company has been named in a number
of asbestos-related lawsuits.

In many of these suits the alleged ties to its products are
either unclear or the Company has been able to demonstrate that
the identified product did not contain asbestos.

The Company does not expect to incur any material liabilities in
connection with these lawsuits. However, there is no assurance
that it will continue to be successful in defending asbestos
claims. In addition, its historic insurance coverage, including
that of its predecessors, may not cover asbestos claims or the
defense of such matters, as coverage depends on the year of
purported exposure and other factors.

The Company noted that there has been an increase in asbestos-
related lawsuits against multiple defendant companies, some of
which historically may have manufactured or sold products that
had asbestos-containing components. Many of these companies have
not been historically associated with having asbestos risks.

Water Pik Technologies Inc. manufactures and markets a line of
end-of-faucet water filtration products for consumers. The
Company developed the first end-of-faucet water filter in the
mid-1970s. The high performance water filtration products are
designed to reduce lead, chlorine, pesticides, cryptosporidium
and giardia cysts, asbestos, sediment, bad taste and odors to
provide consumers with healthier, better tasting water.

Company Profile:

Water Pik Technologies, Inc. (NYSE: PIK)
23 Corporate Plaza, Ste. 246
Newport Beach, CA 92660
Phone: 949-719-3700
Fax: 949-719-6472

Fiscal Year-End December
2003 Sales (mil.)   : GBP171.6
1-Year Sales Growth   : 8.3%
2003 Net Income (mil.)   : GBP6.1
1-Year Net Income Growth  : 98.2%
2003 Employees    : 1,600

Water Pik Technologies, Inc. is an independent, publicly traded
Company with over 35 years of experience. It has been spun off
by Allegheny Technologies, whose metals business didn't fit with
Water Pik Technologies' personal care and pool products.

ASBESTOS ALERT: WorkCover Probes Walkout at Mall Due to Asbestos
About 400 construction workers in a shopping center in Sydney's
west walked off a refurbishment job after being alerted to the
presence of asbestos on the site.

WorkCover is now investigating the incident at the Westpoint
shopping center in Blacktown, whose renovation is operated by
the Baulderstone Hornibrook Company.

The construction union's Tim Vollmer says the project has been
under way for several weeks but workers have only just learned
of the presence of asbestos.

The site is seeing no work at the moment while the workers are
meeting with Baulderstone to come up with an acceptable plan.
The workers have given a list of demands, including a full risk
assessment and the hiring of a hygienist. They are also asking
that removal of the danger be done before any of the workers

"If those demands aren't met, there's not going to be any
further work on this site," added Mr. Vollmer.

Company Profile:

Baulderstone Hornibrook Company
Level 10, 40 Miller Street,
North Sydney, New South Wales 2060
Phone: (02) 9935 7100
Fax: (02) 9935 7080
E-mail: bh@bh.com.au

Baulderstone Hornibrook Company is one of the largest integrated
engineering, building and service provides in Australia, with
diverse operations across building, civil engineering, services
and capital solutions. Baulderstone Hornibrook has a proud
history for creating world-class facilities and landmarks for
the Australian community.

                   New Securities Fraud Cases

ATHEROGENICS INC.: Schiffrin & Barroway Lodges Stock Suit in NY
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of all securities
purchasers of the Atherogenics, Inc. (Nasdaq: AGIX) ("AGIX" or
the "Company") from September 28, 2004 and December 31, 2004
inclusive (the "Class Period").

The complaint charges AGIX, Russell Medford, Mark Colonnese, and
Robert Scott 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 which were known to defendants or
recklessly disregarded by them:

     (1) that the Company hyped the results of an inconclusive
         and limited study of AGI-1067;

     (2) that the statistically impressive levels of plaque
         reduction, described by AGIX in the initial
         announcement, varied significantly from the results
         achieved by the Cleveland Clinic;

     (3) that the Company was burning cash at a high rate; and

     (4) that the Company manipulated the study's results in
         order to enter into a strategic partnership with a
         major pharmaceutical company to complete the
         development and commercialization of AGI-1067.

For more details contact Marc A. Topaz, Esq. or Darren J. Check,
Esq. of Schiffrin & Barroway, LLP by Phone: 1-888-299-7706 or
1-610-667-7706 or by E-mail: info@sbclasslaw.com.

CHINA AVIATION: Lerach Coughlin Lodges Securities Suit in NY
The law firm of Lerach Coughlin Stoia Geller Rudman & Robbins
LLP ("Lerach Coughlin") initiated a class action in the United
States District Court for the Southern District of New York on
behalf of purchasers of China Aviation Oil (Singapore)
Corporation Ltd. ("China Aviation") (Pink Sheets:CAOLF) publicly
traded securities during the period between February 5, 2004 and
November 30, 2004 (the "Class Period").

The complaint charges China Aviation and certain of its officers
and directors with violations of the Securities Exchange Act of
1934. China Aviation trades in petroleum products, including jet
fuel, gas oil, fuel oil, crude oil, plastics and oil

The complaint alleges that during the Class Period, defendants
issued false and misleading statements regarding the Company's
business and prospects. As a result of the defendants' false
statements, China Aviation shares traded at inflated levels
during the Class Period, whereby the Company's top officers and
directors assisted the Company's parent company/controlling
shareholder in the sale of $120 million worth of its own shares.
The true facts, which were known by each of the defendants but
concealed from the investing public during the Class Period,
were as follows:

     (1) that contrary to the Company's prospectus, the Company
         did not have the necessary risk management controls in
         place for hedging and trading;

     (2) that contrary to the private placement offering
         documents, the funds raised were not to fund an
         acquisition of the controlling shareholders but rather
         to meet margin calls for massive derivative losses; and

     (3) that the Company's financial statements were grossly
         overstated or the Company was hiding liabilities
         totaling in excess of $550 million in derivative
         trading losses.

On November 30, 2004, Bloomberg reported that China Aviation was
seeking court protection after losing $550 million from bad bets
on oil prices. On this news, trading in the Company's shares was
suspended after the shares dropped to below $.60 per share.

For more details, contact Samuel Rudman or David Rosenfeld of
Lerach Coughlin by Phone: 800/449-4900 or 619/231-1058 or by E-
mail: wsl@lerachlaw.com or visit their Web site:

GEOPHARMA INC.: Lasky & Rifkind Sets Lead Plaintiff Deadline
The law firm of Lasky & Rifkind, Ltd., reminds investors that
the deadline for purchasers of GeoPharma, Inc. ("GeoPharma" or
the "Company") (NASDAQSC:GORX) to move for lead plaintiff in
this securities fraud class action is rapidly approaching. The
lawsuit was filed against GeoPharma and Kotha Sekharam
("Defendants"). If you purchased or otherwise acquired publicly
traded securities of GeoPharma between July 13, 2004 and
December 2, 2004, inclusive, (the "Class Period") and wish to be
a lead plaintiff in the case you must move to serve as a lead
plaintiff by filing a motion in the United States District Court
for the Northern District of California no later than January
31, 2005.

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
Defendants issued false and misleading statements with respect
to its product Mucotrol. In particular, On July 13, 2004,
GeoPharma and its wholly-owned subsidiary, Belcher
Pharmaceuticals, Inc., issued a press release reporting that
GeoPharma had met with success in a clinical study of its drug,
MF5232, later named "Mucotrol," in treating patients with
mucositis. On December 1, 2004, GeoPharma announced that
Mucotrol had been approved by the Food & Drug Administration
("FDA"). In reaction to this news, shares of GeoPharma
skyrocketed to $11.25 per share. Soon thereafter, journalists
uncovered that the FDA had not approved any such drug. It was
then acknowledged by the Company that Mucotrol was a "device"
and not a drug, which is a material difference. In addition,
Mucotrol did not contain any medical ingredients. On this news
shares of GeoPharma declined, trading at $6.81 at which point
trading was halted.

For more details, contact Lasky & Rifkind, Ltd. by Phone:
(800) 495-1868 or by E-mail: investorrelations@laskyrifkind.com.

MEDQUIST INC.: Goodkind Labaton Sets Lead Plaintiff Deadline
The law firm of Goodkind Labaton Rudoff & Sucharow LLP reminds
investors that the deadline for purchasers of Medquist Inc.
("Medquist" or the "Company") (Pink Sheets:MEDQ) to move for
lead plaintiff in the securities fraud class action is rapidly
approaching. The lawsuit was filed against Medquist, Brian J.
Kearns and Davis A. Cohen ("Defendants"). If you purchased or
otherwise acquired publicly traded securities of Medquist
between April 23, 2002 and November 2, 2004, inclusive, (the
"Class Period") and wish to be a lead plaintiff in the case you
must move to serve as a lead plaintiff by filing a motion in the
United States District Court for the District of New Jersey no
later than January 7, 2005.

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
Defendants issued a series of materially false and misleading
statements regarding the financial condition of the Company.
More specifically, the complaint alleges that Defendants
statements were materially false and misleading because the
Company's financial statements for 2002 and 2003 were the result
of fraudulent financial manipulations, including ambiguous
billing to clients which resulted in the overstatement of the
Company's revenue and earnings by a material amount. Moreover,
the complaint alleges that the Defendants indicated that
Company's financial statements complied with Generally Accepted
Accounting Principles ("GAAP") when they did not.

On November 2, 2004, Medquist announced that on October 29,
2004, the Company's Board of Directors concluded that the
Company's previously issued financial statements, including the
10-K reports for 2002 and 2003, as well as the encompassed Forms
10-Q for the corresponding periods, and all earnings releases
and communications should no longer be relied upon. These
statements by the Company followed the conclusion of Debevoise &
Plimpton LLP and PricewaterhouseCoopers LLP, that the way
Medquist billed for services created ambiguities in how client
accounts were calculated. This in turn led to incorrect billing
and inflated revenues. Shares of Medquist traded to
approximately $13.00 per share in reaction to the news, nearly
53% below the Class Period high of $29.13 per share.

For more details, contact Christopher Keller, Esq. of Goodkind
Labaton Rudoff & Sucharow LLP by Phone: (800) 321-0476 or by E-
mail: http://www.glrslaw.com/get/?case=Medquist.

ROYAL GROUP: Lasky & Rifkind Lodges Securities Suit Fraud in NY
The law firm of Lasky & Rifkind, Ltd., initiated a lawsuit in
the United States District Court for the Southern District of
New York, on behalf of persons who purchased or otherwise
acquired publicly traded securities of Royal Group Technologies
Limited ("Royal Group" or the "Company") (NYSE:RYG) between
February 11, 1999 and October 13, 2004, inclusive, (the "Class
Period"). The lawsuit was filed against Royal Group and certain
officers and directors ("Defendants").

The complaint alleges that during the Class Period, 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 Defendants issued a series of false and
misleading statements during the Class Period regarding the
Company's financial performance. More specifically, Defendants
failed to disclose that they were enjoined in a scheme to packet
ill-gotten monies in violation of applicable law, including laws
governing "fraud" and "conspiracy", used a resort partially
owned by them as a vehicle to steal money from the Company,
delayed the write down of these assets to prevent further
earnings erosion, the Company's U.S. window business was not
poised for growth but faltering, contrary to defendants'
portrayal, the Defendants' margins were being eroded by the
increase of higher raw material costs and as a result
Defendants' projections for FY 2003-2004 were grossly

On October 15, 2004, Royal Group disclosed the first Royal
Canadian Mounted Police ("RCMP") production order for three
Royal Group current or former executives who faced allegations
of defrauding shareholders and creditors. The court documents
named company founder, controlling shareholder and non-executive
chairman Vic De Zen, former CFO Gary Brown and then current
President and CEO Douglas Dunsmuir. The investigation relates to
allegations that De Zen, Brown and Dunsmuir violated sections of
the Criminal Code for fraud and conspiracy by circulating or
publishing a prospectus or statement or account which they knew
was false, for a period between January 1996 and July 2004. Upon
this news, shares of Royal Group fell $1.12 per share, or almost
15%, to close at $7.85 per share on the next trading day on
unusually heavy trading volume. On October 28, 2004, these
allegations widened to include current CFO Ronald Goegan and
large shareholders Domenic D'Amico and Fortunato Bordin, and
expanded the time period to between January 1996 to present.

For more details, contact Lasky & Rifkind, Ltd. by Phone:
(800) 495-1868 or by E-mail: investorrelations@laskyrifkind.com.

SUPPORTSOFT INC.: Goodkind Labaton Sets Lead Plaintiff Deadline
The law firm of Goodkind Labaton Rudoff & Sucharow LLP, reminds
investors that the deadline for purchasers of Supportsoft, Inc.
("Supportsoft" or the "Company") (Nasdaq:SPRT) to move for lead
plaintiff in this securities fraud class action is rapidly
approaching. The lawsuit was filed against Supportsoft and Radha
R. Basu and Brian M. Beattie ("Defendants"). If you purchased or
otherwise acquired publicly traded securities of Supportsoft
between January 20, 2004 and October 1, 2004, inclusive, (the
"Class Period") and wish to be a lead plaintiff in the case you
must move to serve as a lead plaintiff by filing a motion in the
United States District Court for the Northern District of
California no later than February 7, 2005.

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
Defendants issued a series of false and misleading statements to
the market during the Class Period. These statements were false
and misleading because the Company failed to disclose that its
business model was in fact not materially differentiated from
other enterprise software companies, that its customers were
implementing additional hurdles to contract approvals and that
it was experiencing execution difficulties.

On October 4, 2004, the Company announced its preliminary
financial results for the third quarter 2004, ended September
30, 2004. The Company announced that it expected total revenues
for the third quarter 2004 to be in the range of $11.9 million
to $12.3 million as compared to $13.5 million for the same
period the prior year. The Company claimed that a "tightness in
IT spending" and "more complex approval processes" was the
reason for the significant miss. On this news, the Company's
share price dropped from $9.62 per share to $6.21 per share,
representing a drop of 35.4% on extremely heavy trading volume.

For more details, contact Christopher Keller, Esq. of Goodkind
Labaton Rudoff & Sucharow LLP by Phone: (800) 321-0476 or by E-
mail: http://www.glrs.com/get/?case=Supportsoft.


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


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Copyright 2005.  All rights reserved.  ISSN 1525-2272.

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