/raid1/www/Hosts/bankrupt/CAR_Public/050117.mbx
C L A S S A C T I O N R E P O R T E R
Monday, January 17, 2005, Vol. 7, No. 11
Headlines
APOLLO GROUP: Shareholders Launch Securities Fraud Suits in AZ
ARGENTINA: Shalov Stone Distributes Legal Notices To Bondholders
BAY NETWORKS: CA Court Dismisses Suit For Securities Violations
CALAMP CORPORATION: CA Court Approves Wage Lawsuit Settlement
CAN-SPAM ACT: FTC Moves CAN-Spam Act Provisions' Effective Date
CONNECTICUT: Local Builders Lodge Suit Over Building Permit Fess
COVENTRY HEALTH: Enters Into MOU With Plaintiffs in IL Lawsuit
CROMPTON CORPORATION: Settles Price-Fixing Suits For $97M
CROSS ROADS: Recalls 5T Recreational Vehicles For Exhaust Defect
EMERSON TOOL: Recalls 6,500 Blower Vacs Because of Injury Hazard
ETHNIC GOURMET: Recalls Chicken Entrees For Undeclared Allergen
FLOW INTERNATIONAL: Recalls Snowboard Bindings For Injury Hazard
GENERAL MOTORS: Recalls 98,221 Vehicles Due to Defective Part
HAIR CUTTERY: Women Lodges Racial Discrimination Lawsuit in DC
HOLOCAUST LITIGATION: Settlement Fund Publishes Account Owners
MACY'S EAST: Reaches $600T Racial Profiling Settlement in NY
MCKESSON CORPORATION: $960M Settlement Won't Tap D&O Coverage
MICRON TECHNOLOGY: Faces Lawsuits Over DoJ DRAM Antitrust Probe
NATIONAL RESEARCH: Reaches Consumer Settlement With 42 States
NORTEL NETWORKS: Investors File Suits Over Financial Revisions
NORTEL NETWORKS: Asks NY Court To Dismiss Securities Fraud Suit
NORTEL NETWORKS: Faces Consolidated ERISA Violations Suit in TN
NORTEL NETWORKS: Investors File Stock Lawsuits in Canadian Court
PAYPERACTION LLC: TX AG Commences Lawsuit Over Unwanted E-mails
PERONA FARMS: Recalls Smoked Salmon Due To Listeria Content
POLARIS INDUSTRIES: CPSC Imposes Civil Penalty Over ATV Defects
POUNDEX ASSOCIATES: Recalls 32,000 Chairs Due To Injury Hazard
REMEDIA LTD.: Tel Aviv Court Approves NIS7.25 Million Settlement
SHAW GROUP: Shareholders Lodge Securities Fraud Suits in E.D. LA
UNIVERSAL LIFE: CEO Influenced Prudential Financial's Exec Picks
UNIVERSITY OF PHOENIX: Discovery Proceeds in CA Overtime Lawsuit
VERIZON WIRELESS: Customers Lodge Suit in CA Over Phone Features
VIRGINIA MASON: Patients Lodge Over-Billing Suit in WA
WAL-MART STORES: Recalls 600T GE Slow Cookers Due To Burn Hazard
WASHINGTON: 9/11 Compensation Administrator Urges Legal Reform
WASHINGTON: Court Ruling Could Lead To Deportations Of Somalis
New Securities Fraud Cases
CONEXANT SYSTEMS: Milberg Weiss Launches Securities Suit in NJ
CONEXANT SYSTEMS: Schiffrin & Barroway Files Stock Suit in NJ
INPUT/OUTPUT INC.: Charles J. Piven Lodges Securities Suit in TX
JAKKS PACIFIC: Lerach Couglin Updates NY Securities Fraud Suit
OFFICEMAX INC.: Lerach Coughlin Lodges Securities Suit in IL
OFFICEMAX INC.: Schiffrin & Barroway Files Securities Suit in IL
PFIZER INC.: Scott + Scott Lodges Securities Fraud Suit in CT
PFIZER INC.: Emerson Poynter Launches Securities Suit in S.D. NY
SOURCECORP INC.: Schiffrin & Barroway File Securities Suit in TX
SOURCECORP INC.: Lerach Coughlin Updates TX Securities Lawsuit
SUPPORTSOFT INC.: Marc S. Henzel Lodges Securities Suit in CA
SUPPORTSOFT INC.: Shepherd Finkelman Files Securities Suit in CA
TASER INTERNATIONAL: Berman DeValerio Lodges Stock Suit in AZ
TASER INTERNATIONAL: Girard Gibbs Lodges Securities Suit in AZ
*********
APOLLO GROUP: Shareholders Launch Securities Fraud Suits in AZ
--------------------------------------------------------------
The Apollo Group, Inc. faces several class actions filed in the
United States District Court for the District of Arizona,
alleging violations of federal securities laws.
On approximately October 12, 2004, a class action complaint was
filed, captioned "Sekuk Global Enterprises et. al. v. Apollo
Group, Inc. et. al., Case No. CV 04-2147 PHX NVW." Plaintiff, a
shareholder of the Company who purchased its shares in August
and September of 2004, filed this class action on behalf of
itself and all shareholders of the Company who acquired their
shares between March 12, 2004 and September 14, 2004, and seeks
certification as a class and monetary damages in unspecified
amounts.
Plaintiff alleges violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, and Rule 10b-5 promulgated
under the Exchange Act, by the Company for its issuance of
allegedly materially false and misleading statements in
connection with its failure to publicly disclose the contents of
the U.S. Department of Education's program review report.
A second class action complaint making similar allegations was
filed on or about October 18, 2004, in the United States
District Court for the District of Arizona, captioned
"Christopher Carmona et. al. v. Apollo Group, Inc. et. al., Case
No. CV 04-2204 PHX EHC." A third class action complaint making
similar allegations was filed on or about October 28, 2004, in
the United States District Court for the District of Arizona,
captioned "Jack B. McBride et. al. v. Apollo Group, Inc. et.
al., Case No. CV 04-2334 PHX LOA."
ARGENTINA: Shalov Stone Distributes Legal Notices To Bondholders
----------------------------------------------------------------
The law firm of Shalov Stone & Bonner LLP has begun to
distribute a Notice of Class Action in a Court-certified class
action on behalf of certain holders of bonds issued by the
Republic of Argentina. The case, entitled Urban GmbH v. Republic
of Argentina (Case No. 02 Civ. 5699 (TPG)), pending in the
United States District Court for the Southern District of New
York, was formally certified by the Court as a class action on
behalf of all persons who purchased either of the following
bonds on or before July 22, 2002, and hold them continuously
through the date of any final judgment as to liability:
-- Republic of Argentina Bonds, due January 30, 2017, bearing
interest at a rate of 11 3/8% per year (CUSIP No. 040114AR1,
ISIN No. US040114AR16, WKN No. 189518); or
-- Republic of Argentina Bonds, due April 7, 2009, bearing
interest at a rate of 11 3/4 % per year (CUSIP No. 040114BE9,
ISIN No. US04011BE93, WKN No. 299266).
Recently, the Court directed that plaintiff proceed with giving
notice of the class action to class members. A copy of the
Court-approved Notice of Class Action can be downloaded at the
website http://www.argentinaclassaction.com.
The lawsuit alleges that the Republic of Argentina's default is
a breach of contract. The lawsuit seeks to recover unpaid past
due interest. Shalov Stone & Bonner LLP, a law firm based in New
York City, represents the plaintiff and the class.
The website (http://www.argentinaclassaction.com)includes
information about the class action and an appendix to the
notice, which includes important information that holders of
Republic of Argentina bonds should consider in connection with
making a decision about whether to participate in the class
action or whether to participate in Argentina's current exchange
offer. By accepting the exchange offer, class members will be
foregoing the right to join the class action. The appendix to
the notice was not approved or disapproved by the court.
For more details, contact Thomas G. Ciarlone, Jr. of Shalov
Stone & Bonner LLP by Mail: 485 Seventh Avenue, Suite 1000, New
York, New York 10018 by Phone: (212) 239-4340 by E-mail:
tciarlone@lawssb.com or visit their Web site:
http://www.argentinaclassaction.com.
BAY NETWORKS: CA Court Dismisses Suit For Securities Violations
---------------------------------------------------------------
The California Superior Court for the County of Santa Clara
dismissed the shareholder class action filed against Bay
Networks, Inc., which Nortel Networks Corporation acquired on
August 31,1998.
On March 4, 1997, two separate lawsuits were filed in the U.S.
District Court for the Northern District of California and the
California Superior Court, County of Santa Clara against the
Company and ten of its then current and former officers and
directors purportedly on behalf of a class of shareholders who
purchased Bay Networks' common shares during the period of May
1, 1995 through October 14, 1996.
On August 17, 2000, the Federal Court granted the defendants'
motion to dismiss the federal complaint. On August 1, 2001, the
U.S. Court of Appeals for the Ninth Circuit denied the
plaintiffs' appeal of that decision. On April 18, 1997, a
second lawsuit was filed in the California Court, purportedly on
behalf of a class of shareholders who acquired Bay Networks'
common shares pursuant to the registration statement and
prospectus that became effective on November 15, 1995.
The two actions in the California Court were consolidated in
April 1998; however, the California Court denied the Plaintiffs'
motion for class certification. In January 2000, the California
Court of Appeal rejected the plaintiffs' appeal of the decision.
A petition for review was filed with the California Supreme
Court by the plaintiffs and was denied. In February 2000, new
plaintiffs who allege to have been shareholders of Bay Networks
during the relevant periods, filed a motion for intervention in
the California Court seeking to become the representatives of a
class of shareholders. The motion was granted on June 8, 2001
and the new plaintiffs filed their complaint-in-intervention on
an individual and purported class representative basis alleging
misrepresentations made in connection with the purchase and sale
of securities of Bay Networks in violation of California
statutory and common law.
On March 11, 2002, the California Court granted the defendants'
motion to strike the class allegations. The plaintiffs were
permitted to proceed on their individual claims. The
intervenor-plaintiffs appealed the dismissal of their class
allegations. On July 25, 2003, the California Court of Appeal
reversed the trial court's dismissal of the intervenor-
plaintiffs' class allegations. On September 3, 2003, the
defendants filed a petition for review with the California
Supreme Court seeking permission to appeal the Court of Appeal
decision. On October 22, 2003, the California Supreme Court
denied, without opinion, the defendants' petition for review.
On December 22, 2003, the plaintiffs served their motion for
certification of a class of purchasers of Bay Networks' common
shares from July 25, 1995 through to October 14, 1996. Hearing
of the plaintiffs' motion for class certification was held on
May 4, 2004. On July 27, 2004, the Court entered an Amended
Order Denying Motion of Intervenor Plaintiffs for class
certification and Setting Further Hearing. On August 9, 2004,
the intervenor-plaintiffs obtained Court approval to dismiss
their claims and this action and, on September 30, 2004, the
Court entered dismissal with prejudice of the entire action of
all parties and all causes of action.
CALAMP CORPORATION: CA Court Approves Wage Lawsuit Settlement
-------------------------------------------------------------
A California State court approved the settlement of a class
action filed against CalAmp Corporation, alleging certain
violations of the California labor code. Among other charges,
the class action complaint alleges that from October 2000 to the
present time certain hourly employees did not take their lunch
break within the time period prescribed by state law.
In September 2004, the Company and the plaintiffs entered into a
settlement agreement, which was approved by the court in October
2004. As a result of the settlement agreement, the Company
lowered its reserve by $200,000 in the nine months ended
November 30, 2004, which reduced Product Division cost of
revenue by the same amount.
CAN-SPAM ACT: FTC Moves CAN-Spam Act Provisions' Effective Date
---------------------------------------------------------------
The Federal Trade Commission has postponed the effective date of
rule provisions it adopted December 16, 2004, establishing
criteria for determining whether the primary purpose of an e-
mail message is commercial. The Commission adopted these
regulations in accordance with a specific requirement of the
CAN-SPAM Act.
When the FTC adopted these rule provisions, it determined that
they would become effective on February 18, 2005. Recently,
however, the Office of Management and Budget's Office of
Information and Regulatory Affairs (OIRA) has determined that
the provisions constitute a "major rule" under the Small
Business Regulatory Enforcement Fairness Act (SBREFA), 5 U.S.C.
Sec. 801-808. Under that Act, a major rule cannot take effect
until at least 60 days after it is published in the Federal
Register and submitted to Congress. As a result, the Commission
has revised the effective date in accordance with OIRA's
determination and the requirements of SBREFA. The revised
effective date will be March 28, 2005.
The Commission has made no other modifications to either the
text of the rule provisions themselves or the statement of basis
and purpose describing and explaining the provisions, the record
supporting them, and the Commission's rationale in adopting
them.
The CAN-SPAM Act, which took effect January 1, 2004, requires
the Commission to issue regulations "defining the relevant
criteria to facilitate the determination of the primary purpose
of an electronic mail message." The FTC published a Federal
Register notice of proposed rulemaking (NPRM) on August 13,
2004, seeking public comment on its proposed primary purpose
criteria. The NPRM followed an Advance Notice of Proposed
Rulemaking, issued on March 11, 2004, on this and other related
issues raised by the CAN-SPAM Act.
As detailed in the Federal Register notice, which soon will be
available, the final Rule is substantially similar to the
proposal contained in the NPRM, but adds a criterion for
determining the primary purpose of an e-mail message containing
only "transactional or relationship" content, among other minor
changes. The CAN-SPAM Act regulates both commercial messages and
transactional or relationship messages. The notice makes clear
that the Commission does not intend to regulate non-commercial
speech through the Rule. The notice also addresses public
comments received about the constitutionality of the CAN-SPAM
Act, as well as of the FTC's "primary purpose" criteria.
The final Rule sets forth criteria for determining the primary
purpose of various kinds of e-mail messages. These criteria
include:
(1) For e-mail messages that contain only the commercial
advertisement or promotion of a commercial product or
service ("commercial content"), the primary purpose of
the message will be deemed to be commercial;
(2) For e-mail messages that contain both commercial
content and "transactional or relationship" content as
set forth in the Act's definition of "transactional or
relationship message" and in the final Rule, the
primary purpose of the message will be deemed to be
commercial if either a recipient reasonably
interpreting the subject line of the e-mail would
likely conclude that the message contains commercial
content; or the e-mail's "transactional or
relationship" content does not appear in whole or
substantial part at the beginning of the body of the
message;
(3) For e-mail messages that contain both commercial
content and content that is neither "commercial" nor
"transactional or relationship," the primary purpose of
the message will be deemed to be commercial if either a
recipient reasonably interpreting the subject line of
the message would likely conclude that the message
contains commercial content; or a recipient reasonably
interpreting the body of the message would likely
conclude that the primary purpose of the message is
commercial. Factors relevant to this interpretation
include the placement of commercial content in whole or
in substantial part at the beginning of the body of the
message; the proportion of the message dedicated to
commercial content; and how color, graphics, type size,
and style are used to highlight commercial content; and
(3) For e-mail messages that contain only "transactional or
relationship" content, the message will be deemed to
have a "transactional or relationship" primary purpose.
(4) Finally, the final Rule incorporates the "Sexually
Explicit Labeling Rule" as promulgated in April 2004.
The Commission vote approving publication of the Federal
Register notice was 4-0-1, with Commissioner Jon Leibowitz not
participating. To ensure there is no confusion about the
effective date of the regulations, the Commission's original
December 16, 2004, press release on this issue has been removed
from the FTC's Web site.
For more details, contact the FTC's Consumer Response Center,
Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580 by
Phone: 1-877-FTC-HELP (1-877-382-4357), or visit the Website:
http://www.ftc.gov. Also contact Mitchell J. Katz, Office of
Public Affairs, Phone: 202-326-2161 or Allen W. Hile, Bureau of
Consumer Protection, by Phone: 202-326-3122
CONNECTICUT: Local Builders Lodge Suit Over Building Permit Fess
----------------------------------------------------------------
Five local area builders filed a civil suit in Superior Court
alleging that the town of Madison's building permit fee schedule
is an unconstitutional "scheme" that specifically and illegally
targets the building industry as a source of town revenue, Shore
Publishing reports.
Seeking both monetary and punitive damages as well as an
injunction prohibiting the town from continuing to charge its
stated fees, the builders are also seeking to bring the case as
a class action on behalf of all builders affected by the fee
schedule and not just the five named plaintiffs. The five
builders listed in the suit are among the best known in Madison,
Connecticut, which includes the Dowler Group, Peter Smith
Building Co., MJM Builders, Inc., and Paul Coady Construction,
all of Madison, and Neighborhood Builders, Inc., of Guilford.
In 2002 the town revised its building permit fee schedule. In
doing so, Town Engineer Stew MacMillan surveyed fee schedules in
a number of communities throughout the area and the state. Mr.
MacMillan told Shore Publishing, "The survey showed at that time
we were not the lowest, nor the highest. We were on the high
side, but others had highest fee schedules."
Following that survey he recommended a revised schedule for
building fees. Presently the town charges a builder $12 per
$1,000 of construction cost for a building permit. For example,
a builder constructing a home with an estimated construction
cost of $600,000 would pay $7,200 in fees to the town.
In their suit, the plaintiffs allege that the fees do not
reflect the actual costs the town incurs in the administration
and inspection of buildings under construction. Instead, the
plaintiffs say, the fee schedule is being used as a revenue
producing measure "in part to fund social programs, and other
initiatives that have no relationship to the offering and
regulation of building activity in the town."
Atty. Drew Lichtenfels, attorney for the builders, told Shore
Publishing "The suit is pretty simple. The real purpose of
building fees in Madison is to generate revenue. That is
patently illegal and well outside the law . The rates are
offensive and egregious. The rates are out of line. They know it
and we know it. The town determined, based on its need for
revenue, what people in the building industry should pay in
order to do business in town. It is a deliberate and considered
attempt to offset the costs of running the town by targeting
builders. We are suing Madison because what they are doing is
wrong."
The suit further contends, "Fees in excess of the amount which
is necessary for offering and regulating a particular service
constitute an illegal tax." The present fee schedule "bears no
relationship to [Madison's] true costs in offering and
regulating the building activity in town," it continues, and the
town "unlawfully uses building permit fees...in part to fund its
general operations." The fees constitute unlawful taxation, the
plaintiffs say, and violate the state's Unfair Trade Practices
Act.
Mr. Lichtenfels pointed out to Shore Publishing, "There is a
constitutional question here. The town has assumed a taxing
authority, which has not been granted to it by statute. Just as
grievous, the town is targeting a specific class of individuals.
They are telling builders, 'You can't work in this town unless
you pay what we say you have to pay.' That's arrogance, and
that's wrong." As of press time the town has turned the suit
over to its own legal counsel.
COVENTRY HEALTH: Enters Into MOU With Plaintiffs in IL Lawsuit
--------------------------------------------------------------
Coventry Health Care, Inc. (NYSE:CVH) and First Health Group
Corporation (NASDAQ:FHCC) have entered into a memorandum of
understanding with plaintiff's counsel in connection with a
purported class action lawsuit filed on October 20, 2004 (as may
be amended by the proposed amended complaint filed on January 7,
2004) against First Health, First Health's board of directors
and Coventry in the Circuit Court of Cook County, Illinois.
Under the terms of the memorandum, Coventry, First Health and
the plaintiff have agreed to settle the lawsuit subject to court
approval. If the court approves the settlement, the lawsuit will
be dismissed with prejudice. Coventry and First Health
vigorously deny all of the allegations in the lawsuit.
Nevertheless, pursuant to the terms of the memorandum Coventry
and First Health have agreed to provide additional information
to stockholders through publicly available filings which provide
additional information as to matters which were the subject of
the following sections of the Proxy Statement/Prospectus which
has been provided to First Health stockholders in connection
with the special meeting of stockholders concerning the proposed
merger:
(1) Background of the Merger;
(2) Interests of Certain Persons in the Merger;
(3) Opinion of First Health's Financial Advisor; and
(4) Comparison of Rights of Stockholders of Coventry and
Stockholders of First Health
For more details visit http://www.cvty.comor
http://www.firsthealth.com.
CROMPTON CORPORATION: Settles Price-Fixing Suits For $97M
----------------------------------------------------------
Crompton Corporation is set to pay $97 million to settle three
class-action lawsuits stemming from its role in an international
conspiracy to fix prices in the rubber additives market, the
Associated Press reports.
As previously reported in the January 13, 2004 edition of the
Class Action Reporter, Crompton Chairman, President and Chief
Executive Officer Robert L. Wood, stated that the settlement
"while costly, is manageable," and added that the deal allows
the Company to avoid prolonged litigation and possibly paying
damages three times over.
Crompton, which had sales of $2.2 billion in 2003, produces
specialty chemicals and polymer products used to make rubber and
plastics. They have about 5,400 employees worldwide, including
650 workers at its Middlebury headquarters, 65 at its research
and development installation in Naugatuck and 34 at a center in
Bethany.
According to the Company, Kenneth Feinberg, the special master
who oversaw the September 11 victims' compensation fund, will
act as a mediator and help determine how the funds will be
distributed among the three classes and that they will establish
a $93.1 million reserve in its 2004 financial reports to help
cover the settlement. The Company also stated that each of the
three courts where the lawsuits are pending would be asked to
give preliminary approval.
Crompton agreed to plead guilty in the United States and Canada
last March to participating in an international conspiracy to
eliminate competition in the rubber chemicals industry, and to
pay about $57 million in fines to U.S. and Canadian authorities
over the next five years.
The Company still faces three other class-action suits filed by
direct purchasers in courts in Quebec and Ontario, Canada, as
well as a number of suits filed by indirect purchasers in 15
states in the U.S.
CROSS ROADS: Recalls 5T Recreational Vehicles For Exhaust Defect
----------------------------------------------------------------
Cross Roads, Inc. is cooperating with the National Highway
Traffic Safety Administration (NHTSA) by voluntarily recalling
5,890 recreational vehicles, namely:
(1) CROSSROADS / CROSS TERRAIN, model 2001-2005
(2) CROSSROADS / CROSSROADS, model 2001-2005
(3) CROSSROADS / CRUISER, model 2001-2005
(4) CROSSROADS / PARADISE POINTE, model 2001-2005
(5) CROSSROADS / SILVERADO, model 2001-2005
Certain travel and fifth wheel trailers have improperly
installed furnace exhaust vents. Improper installation or lack
of the furnace exhaust vent will allow the exhaust fumes,
containing combustion products, including high concentrations of
carbon monoxide gas, to enter into the recreational vehicle and
could result in injury or death to occupants of the trailer.
Owners/Dealers will inspect the furnace exhaust vent and, if not
properly installed, the dealers will repair the vent. Owners
are being instructed not to use the furnace until the exhaust
vent has been inspected and is properly repaired. The recall is
expected to begin in Late January or early February 2005.
Owners may contact the Company by Phone: 260-593-2866 or contact
the NHTSA's auto safety hotline: 1-888-DASH-2-DOT
(1-888-327-4236).
EMERSON TOOL: Recalls 6,500 Blower Vacs Because of Injury Hazard
----------------------------------------------------------------
Emerson Tool Co., of St. Louis, Missouri is cooperating with the
United States Consumer Product Safety Commission by voluntarily
recalling about 6,500 Ridgidr 16-Gallon, Model WD16650 2-In-1
Blower Vac.
The air intake shield may be missing. Consumers can suffer
lacerations if they come into contact with the intake blower
wheel. Emerson Tool Co. has received two reports of consumers
who suffered lacerations to finger tips while using these
vacuums.
The Ridgidr 16-gallon 2-In-1 Blower Vac, Model WD16650, have
light gray drums with orange lids, gray power heads, and black
wheels. The recalled units have the model number and a serial
number from 04104C through 04114C located on a label on the side
of the power head. "Ridgidr 2 In 1 Blower Vac" is written on the
front of the units.
Manufactured in Canada, the blower vacs were sold at all Home
Depot stores and by RIDGE TOOL distributors nationwide from
April 2004 through January 2005 for about $100.
If the air intake shield is missing, consumers should stop using
their vacuum and contact the firm for a free repair kit.
Consumer Contact: Consumers should call Emerson Tool Co. at
(800) 372-7759 between 8 a.m. and 6 p.m. CT Monday through
Friday, or visit their Web site at
http://www.emersontoolCompany.com.
ETHNIC GOURMET: Recalls Chicken Entrees For Undeclared Allergen
---------------------------------------------------------------
Ethnic Gourmet Foods, a Framingham, Massachusetts,
establishment, is voluntarily recalling an undetermined number
of chicken biryani frozen entr‚es due to an undeclared allergen,
the Food Safety and Inspection Service announced. The package
label does not indicate that the product was marinated in
yogurt, which contains milk, a known potential allergen.
The products subject to recall are 12 oz. packages of "TRADER
JOE'S Chicken Biryani, Traditional Indian Style White Chicken
Biryani over Steamed Rice." Each package bears the product code
"0022 5250." Additionally, the establishment code "P-19362" is
located inside the USDA mark of inspection.
The products were produced on various dates between January 2000
and December 17, 2004, and distributed to retail establishments
in Connecticut, Delaware, the District of Columbia, Illinois,
Indiana, Maryland, Massachusetts, Michigan, Missouri, New
Jersey, New York, Ohio, Pennsylvania and Virginia.
The problem was discovered by the Company. FSIS has received no
reports of allergic reactions associated with consumption of
this product. Anyone concerned about an allergic reaction should
contact a physician.
Consumers or media with questions about the recall may contact
Company Consumer Affairs Manager Lisa Lehndorff at (303) 581-
1313. Consumers with other food safety questions can phone the
toll-free USDA Meat and Poultry Hotline at 1-888-MPHotline (1-
888-674-6854). The hotline is available in English and Spanish
and can be reached from 10 a.m. to 4 p.m. (Eastern Time), Monday
through Friday. Recorded food safety messages are available 24
hours a day.
FLOW INTERNATIONAL: Recalls Snowboard Bindings For Injury Hazard
----------------------------------------------------------------
Flow International Inc., of San Francisco, California is
cooperating with the United States Consumer Product Safety
Commission by voluntarily recalling about 6,000 2004 Flow MK
Series Snowboard Bindings.
The pin used to secure the rear snaplock lever to the bindings
can bend or break. Flow International has received 40 reports of
the pins bending or breaking. No injuries have been reported.
This recall includes 2004 Flow MK series snowboard bindings with
model numbers MK03, MK04, MK05 and MK110. The bindings affected
by this recall can be identified by the shape of the rear lock
lever and the cable adjustment wheel on the side of the
baseplate (as shown in the photos below). No other bindings are
included in this recall.
Manufactured in China, the bindings were sold at all snowboard
shops nationwide including Gart Sports/TSA and REI from July
2004 through December 2004 for between $150 and $170.
Consumers should stop using the bindings and return them a Flow
dealer to receive a free replacement axle pin used to secure the
rear snaplock lever. Consumers also can contact Flow
International to have a repair kit with instructions sent by
mail.
Consumer Contact: Consumers should contact a Flow Dealer for
repair and information. For additional information, call Flow
International at (800) 691-7611 between 9 a.m. and 5 p.m. PT
Monday through Friday or visit the firm's Web site at
http://www.flow.com.
GENERAL MOTORS: Recalls 98,221 Vehicles Due to Defective Part
-------------------------------------------------------------
General Motors Corporation is cooperating with the United States
National Highway Traffic Safety Administration by voluntarily
recalling 98,221 vehicles, namely:
(1) CHEVROLET / C/K PICKUPS, model 2000
(2) CHEVROLET / SILVERADO, model 2000
(3) CHEVROLET / SUBURBAN, model 2000
(4) GMC / SAVANA, model 2000
(5) GMC / SIERRA, model 2000
(6) GMC / YUKON XL, model 2000
Some pickup trucks, vans and sport utility vehicles equipped
with a hydraulic pump driveshaft that can fracture, resulting in
immediate loss of hydraulic power steering assist. On certain
vehicles equipped with hydro-boost power brakes, the same
condition can result in loss of power assist for braking after
the reserve pressure is depleted. An inoperative pump can cause
increased steering effort and in hydro-boost equipped vehicles
also increased braking effort, but does not completely eliminate
the ability to steer or slow the vehicle.
Dealers will replace the hydraulic pump. The campaign is
expected to begin during February 2005. For more details,
contact Chevrolet by Phone: 1-800-630-2438 or the Company by
Phone: 1-866-996-9463.
This action is deemed a safety improvement campaign and is not
being conducted under the safety act. The Company has informed
the NHTSA that it will provide the modifications described free
of charge.
HAIR CUTTERY: Women Lodges Racial Discrimination Lawsuit in DC
--------------------------------------------------------------
Black minorities Monica Clark of Capitol Heights and Leslie
Mercer of Reston filed a class-action lawsuit against the Hair
Cuttery, accusing the chain of unisex hair salons of charging
black customers more for services because of their race and of
sometimes refusing to serve them, the Washington Post reports.
In their lawsuit, which was filed in U.S. District Court in
Greenbelt, the two claimed that they were mistreated because of
their race repeatedly at several Hair Cuttery locations in the
Washington area. The suit was filed against two Falls Church
companies, Creative Hairdressers Inc., which owns Hair Cuttery,
and Ratner Cos., which operates the chain as well as other
salons.
The Hair Cuttery, which has 800 locations across the United
States, denied that the chain practices discrimination, the Post
reports.
According to an e-mail sent to the Washington Post Marie
Manning, a Hair Cuttery spokeswoman, "We are deeply concerned by
these allegations, and we are looking into this matter with
great diligence. Discrimination in any form never has been, and
never will be, tolerated at Hair Cuttery. All of our Stylists
are required to provide shampoo, cut and style services to any
person, regardless of hair type or race. It's the law, and any
Stylist who does not abide by this policy will be terminated."
Ms. Manning further wrote that stylists are given training "to
ensure that all clients are treated with fairness, equality and
sensitivity."
However, Gregory L. Murphy, an attorney for the plaintiffs, told
the Post there is evidence of repeated violations at various
Hair Cuttery locations. He states, "We know of complaints in
multi-state jurisdictions. How can you have all these complaints
if you are abiding by this policy?"
According to the lawsuit, Ms. Clark went to a Hair Cuttery in
Clinton in January 2004 and was charged $10 more for a wash and
set than the price advertised in the salon. About seven months
later, she again went to a Hair Cuttery in Waldorf, where she
alleges she was kept waiting for a half-hour and then ignored
and passed over for a white male. In October, she said, she went
to a Hair Cuttery in the Potomac Yard shopping center in
Alexandria for a wash, cut and blow dry. This time she alleges
that a stylist there tried to charge her $14 to cut her hair and
$24 to dry it. The standard price for a wash cut and dry was $13
and when she complained, the stylist refused to serve her, she
said. After having her hair done by another stylist, she then
complained to a store manager, but she alleges that the manager
told her that "her kind of hair" was difficult to blow dry.
On the other hand, Ms. Mercer, the second plaintiff, said that
in August she went to a Hair Cuttery in Reston and requested a
roller set, the Post reports. She alleges that she was denied
service and was told that her "type of hair [was] too difficult
to do."
The suit by both women is the second complaint of racial
discrimination filed against Hair Cuttery in the past year. In
June, an Anne Arundel County woman filed a complaint against
Creative Hairdressers in circuit court in Baltimore, alleging
that she was charged extra for services such as a shampoo and a
haircut that case has since been moved to federal court in
Baltimore.
Last year, a Fairfax County woman sued the Hair Cuttery in
Fairfax Circuit Court alleging that she was denied service on
several occasions at different Hair Cuttery locations that case
however, was dismissed.
HOLOCAUST LITIGATION: Settlement Fund Publishes Account Owners
--------------------------------------------------------------
The Swiss Bank Holocaust settlement fund will publish an
additional list of 2,700 names of potential Swiss bank account
owners, and the names of 400 Power of Attorney Holders of Swiss
bank accounts. The newly-published accounts are "probably or
possibly" owned by Victims of Nazi Persecution, and were open in
a Swiss bank between 1933-1945. The publication is being made in
connection with the administration of the $1.25 billion
settlement between Holocaust survivors and Swiss banks reached
in January 1999, in the United States District Court for
the Eastern District of New York before Chief Judge Edward R.
Korman.
Publication of the newly available information is the result of
extensive negotiations with the Swiss banks in an effort to
provide claimants with all available information. 2,400 of the
newly- published names were identified by an audit conducted by
Paul Volcker in December 1999, as "probably or possibly" owned
by Holocaust victims. Swiss banking authorities declined to
permit their publication in February 2001. After extensive
negotiations, the Swiss authorities have now authorized the
publication of the 2,400 names.
In addition, the newly-published names include accounts
identified by Switzerland in 1962 as potentially owned by
Holocaust victims that have been published earlier, but that
have not yet been claimed. The newly published names also
include accounts owned by Polish and Hungarian depositors that
were published locally in Poland and Hungary, but that have not
been the subject of worldwide publication. Certain other names
were obtained by CRT investigators from publicly available
archival sources. Finally, 400 Power of Attorney Holders are
separately listed in an effort to provide additional information
about the newly-published accounts.
Publication of the information concerning the newly-published
accounts on January 13, 2005 will begin a new six-month claims
period, ending on July 13, 2005, during which owners of the
newly published accounts or their heirs may file a claim to a
newly-published bank account with the Claims Resolution Tribunal
(CRT), established by the District Court to administer the bank
account claims process. A complete list of the 3,100 names and
all necessary application forms are available at the websites of
the CRT, http://www.crt-ii.org,and the Holocaust Victim Assets
Litigation (Swiss bank settlement),
http://www.swissbankclaims.com. Potential claimants may also
call designated help centers throughout the world for
information concerning the claims process.
An earlier list of approximately 21,000 accounts was similarly
published in February 2001. The claims period for the February
2001 accounts has expired. CRT will accept new claims only in
connection with the newly published accounts.
Thus far, the CRT has identified approximately 2,800 Swiss bank
accounts owned by Victims of Nazi Persecution, and has awarded
approximately $219 million to bank account claimants. The CRT is
continuing to process bank account claims and anticipates
awarding substantial additional funds to claimants. The District
Court has allocated up to $800 million for the payment of bank
account claims. Until now, bank account claims have been
matched by the CRT against a data base consisting of 36,000
accounts identified by the Volcker Audit as potentially owned by
Holocaust victims. As a result of extensive negotiations, the
CRT is now authorized to match particularly promising claims
against larger databases consisting of up to 4.1 million
accounts open during the relevant period for which any records
survive. Unfortunately, all records of more than 2 million
accounts have been destroyed by the banks, making it impossible
to trace their ownership.
Burt Neuborne, the New York University Law Professor designated
by the Court to serve as lead Settlement Counsel, announced the
following interim distribution figures for the settlement fund:
"I am pleased to announce that approximately $700 million has
now been distributed from the Swiss bank settlement to Holocaust
victims or their heirs. The CRT has identified 2,800 Swiss bank
accounts owned by Holocaust victims, and has awarded
approximately $219 million, with significant additional
distributions anticipated," said Professor Neuborne.
"In addition, researchers have identified about 158,000
surviving Jewish slave laborers, and 18,000 Roma surviving slave
laborers, and have made payments of $1,450 to each, totaling
approximately $255 million. Judge Korman has allocated $205
million to social service agencies to assist the poorest
victims of Nazism throughout the world with food, clothing, fuel
and other necessities. More than $10 million has been
distributed to more than 4,000 Jewish and Roma refugees who were
barred from Switzerland or mistreated there during WW II," said
Professor Neuborne.
"All told, the Swiss bank settlement has now touched the lives
of more than 300,000 Holocaust survivors and victims' heirs. We
will not rest until every claim has been carefully investigated.
"Great credit should go to the dedicated staff of the CRT, as
well as the extraordinary efforts of the Claims Conference and
the International Organization for Migration in Geneva, whose
research, computer, and administrative skills have made it
possible to carry out the most extensive individual claims
program ever undertaken by an American class action," said
Professor Neuborne.
"More than six decades after frightened Europeans tried to hide
their assets from the Nazis by trusting the vaunted Swiss
bankers, the banks have still not come forward with all the
information necessary to rightfully restore all those assets.
Forcing the Swiss banks to produce the additional lists of
victim's names is another step to ensure that the fiduciary
responsibilities of some of the world's most important banks be
fulfilled," said attorney Mel Weiss of Milberg Weiss Bershad &
Schulman LLP, one of the lead attorneys in the cases that
brought about the settlement.
MACY'S EAST: Reaches $600T Racial Profiling Settlement in NY
------------------------------------------------------------
Macy's East agreed to pay $600,000 in damages and change its
security practices for alleged racial profiling of black and
Latino customers, according to a settlement New York State
Attorney General Eliot Spitzer plans to file in court, the New
York Newsday reports.
According to the attorney general, he and his office found that
more than 75 percent of the customers detained at Macy's East,
owner of 29 department stores in New York state, are black and
Latino, significantly higher than the percentage of blacks and
Latinos who shop at there. He also adds that they found that
Macy's staff was unlawfully handcuffing customers and that some
of the incidents occurred at stores in New York City.
The attorney general's investigation also found that at one
upstate store, blacks and Latinos were five times more likely to
be handcuffed than whites by security guards.
The case parallels numerous complaints made nationwide for many
years by minority customers at stores large and small who charge
that they are often followed, questioned and searched based
solely on their race or ethnicity, an offense wryly referred to
as "shopping while black."
Elina Kazan, a spokeswoman for Macy's, told the New York Newsday
that the agreement was a cooperative effort to improve security
procedures and "to ensure that all customers are treated equally
and that all employees abide by the spirit and letter of our
policies." According to Ms. Kazan among the specific changes
Macy's must make are:
(1) Appointing a security monitor to investigate
complaints.
(2) Training security employees extensively to avoid
discrimination.
(3) Adopting new recordkeeping requirements to track
security employees' interaction with customers.
(4) Permit handcuffing of detainees only after they have
been assessed as dangerous.
Last year, Macy's settled a $100 million class-action lawsuit
brought by legal assistant Sharon Simmons-Thomas, of the Bronx,
who claimed she was accused of shoplifting at the 34th Street
flagship store in December 2002 even though she was able to
produce receipts.
Retailers estimate their losses from shoplifting exceed $10
billion a year, and Macy's East estimated in 2002 that it lost
$40 million to such thefts. It claimed that 99 percent of the
12,600 individuals who were apprehended at Macy's East for
shoplifting that year had merchandise they had not paid for.
Though Mr. Spitzer's action is not expected to preclude private
lawsuits by individuals affected, not everybody is happy with
the settlement. City Councilman Charles Barron (D-Brooklyn) who
is a mayoral candidate told Newsday that the settlement was too
small and added, "There should be some punitive damages. You
might not be able to change attitudes, but you can change
behavior if there are consequences. And there really aren't any
consequences here."
MCKESSON CORPORATION: $960M Settlement Won't Tap D&O Coverage
-------------------------------------------------------------
No directors and officers liability insurance will be used to
pay plaintiffs $960 million to settle a securities class action
lawsuit filed against McKesson Corporation, a subsidiary and
current and former executives, according to a spokesman for the
San Francisco-based medical drug and supplies distributor, the
BI Daily News reports.
The reason for this, the spokesman said is that most of the
Company's D&O coverage has been exhausted by previous
settlements and defense costs. Instead, the spokesman adds, the
remaining coverage will be used to fund part of the $240 million
of reserves that McKesson says it also has established to cover
its estimated cost to resolve the remaining claims against the
Company and that insurance would account less than 10% of that
reserve.
The spokesman explained that the claims were triggered by
alleged accounting fraud at a McKesson subsidiary, formerly
called McKesson HBOC, which is now called McKesson Information
Solutions.
As previously reported in the January 14, 2005 edition of the
Class Action Reporter, the settlement by McKesson ranks behind
only those in securities cases filed against Cendant Corp. and
WorldCom Inc. It had stemmed from the drop in McKesson's stock
price after McKesson HBOC began issuing financial restatements
in April 1999. McKesson acquired the unit, originally named HBO
& Co., in a January 1999 transaction.
On April 28, 1999, McKesson HBOC revealed a restatement of $26
million of improperly recorded software revenue for the fiscal
quarter that had ended less than a month earlier and of $16
million of additional improper revenue for previous quarters of
that fiscal year. McKesson HBOC later restated more than $327
million of its reported revenue for previous years.
The settlement class consists of shareholders who acquired HBOC
securities from January 20, 1997, through January 12, 1999, or
acquired McKesson securities from October 18, 1998, through
April 27, 1999, or held McKesson common stock on November 27,
1998, through January 12, 1999.
Like the WorldCom case, the lead plaintiff was the New York
State Common Retirement Fund, however, unlike the WorldCom
settlement, none of the settling McKesson executives is required
to contribute personal funds to the settlement.
A spokesman for New York State Comptroller Alan G. Hevesi, the
trustee for the retirement fund, explained that Mr. Hevesi does
not intend to seek personal contributions in every case and
that, unlike the WorldCom settlement, a judge had dismissed
outside directors from the McKesson litigation. The spokesman
also noted that several defendants, some of whom were involved
in the settlement, still face criminal charges and possibly
"much more severe penalties."
MICRON TECHNOLOGY: Faces Lawsuits Over DoJ DRAM Antitrust Probe
---------------------------------------------------------------
Micron Technology faces numerous class actions in federal and
state courts, over an investigation by the Antitrust Division of
the Department of Justice (DoJ) into possible antitrust
violations in the "Dynamic Random Access Memory" or DRAM
industry.
On June 17, 2002, the Company received a grand jury subpoena
from the U.S. District Court for the Northern District of
California seeking information regarding the DoJ's
investigation. The Company is cooperating fully and actively
with the DOJ in its investigation.
Sixteen cases were filed between June 21, 2002, and September
19, 2002, one in the Southern District of New York, five in the
District of Idaho and ten in the Northern District of
California. The foregoing federal district court cases were
transferred to the U.S. District Court for the Northern District
of California (San Francisco) for consolidated proceedings.
On October 6, 2003 and November 8, 2004, the plaintiffs filed
consolidated amended class action complaints. The most recent
consolidated amended complaint purports to be on behalf of a
class of individuals and entities who purchased DRAM directly
from the various DRAM suppliers during the period from July 1,
1999 through at least June 30, 2002.
The consolidated amended complaint alleges price-fixing in
violation of the Sherman Act and seeks treble monetary damages,
costs, attorneys' fees, and an injunction against the allegedly
unlawful conduct. Eight additional cases were filed between
August 2, 2002, and March 11, 2003, - five in San Francisco
County state court, one in Santa Clara County, one in Los
Angeles County and one in Humboldt County.
Each of the California state cases purports to be on behalf of a
class of individuals and entities who indirectly purchased DRAM
during a specified time period commencing December 1, 2001. The
complaints allege violations of California's Cartwright Act and
state unfair competition law and unjust enrichment and seek
treble monetary damages, restitution, costs, attorneys' fees,
and an injunction against the allegedly unlawful conduct.
The foregoing California state cases were transferred to San
Francisco County Superior Court for consolidated proceedings.
On October 15, 2003, the plaintiffs filed a consolidated amended
class action complaint. The consolidated amended complaint
purports to be on behalf of a class of individuals and entities
who purchased DRAM indirectly from the various DRAM suppliers
during the period from November 1, 2001 through June 30, 2002.
The consolidated amended complaint alleges violations of
California's Cartwright Act and state unfair competition law and
unjust enrichment and seeks treble monetary damages, costs,
attorneys' fees, and an injunction against the allegedly
unlawful conduct.
Thirty additional cases were filed in the following state courts
between May and November 2004:
(1) Hot Spring County, Arkansas; Maricopa County, Arizona
(2 suits);
(2) Collier County, Florida (subsequently dismissed without
prejudice);
(3) Broward County, Florida;
(4) Lee County, Florida;
(5) Miami Dade County, Florida;
(6) Johnson County, Kansas;
(7) Essex County, Massachusetts (subsequently dismissed
with prejudice);
(8) Middlesex County, Massachusetts;
(9) Wayne County, Michigan;
(10) Hennepin County, Minnesota;
(11) Mecklenburg County, North Carolina;
(12) Guilford County, North Carolina;
(13) Cass County, North Dakota;
(14) Lancaster County, Nebraska;
(15) Hudson County, New Jersey;
(16) New York County, New York;
(17) Albany County, New York;
(18) Westchester County, New York;
(19) Cuyahoga County, Ohio;
(20) Pennington County, South Dakota;
(21) Minnehaha County, South Dakota;
(22) Davidson County, Tennessee (3 suits);
(23) Chittenden County, Vermont (2 suits);
(24) Monroe County, Wisconsin; and
(25) Brooke County, West Virginia
The complaints purport to be on behalf of a class of individuals
and entities who indirectly purchased DRAM and/or products
containing DRAM in the respective states during various time
periods ranging from 1999 through the filing of the complaint.
The complaints allege violations of the various state antitrust,
consumer protection and/or unfair competition laws relating to
the sale and pricing of DRAM products and seek treble monetary
damages, restitution, costs, interest and attorneys' fees.
NATIONAL RESEARCH: Reaches Consumer Settlement With 42 States
-------------------------------------------------------------
Idaho and 41 other states joined in a consumer protection
settlement with National Research Center for College and
University Admissions (NRCCUA), Idaho Attorney General Lawrence
Wasden said in a statement. The settlement concerns NRCCUA's
collection of personal information through high school student
surveys.
NRCCUA is a not-for-profit corporation headquartered in Lee's
Summit, Missouri. It surveys and collects information from high
school students each year. In 2001, it collected personal
information from more than two million high school students.
The states alleged that NRCCUA represented or implied that the
information it collected from high school students was shared
only with colleges, universities and other entities providing
education-related services. The states also alleged that NRCCUA
shared the information with commercial entities. Those
businesses used the information to attempt to sell products or
services to the students.
"Parents of high school and junior high school students should
be aware that their children may be asked to complete surveys
like those conducted by NRCCUA," Attorney General Lawrence
Wasden said. "They should also be aware that, by federal law,
parents have the right to tell schools not to give certain
surveys to their children. Parents who do not want their
children to be given surveys should make their preference known
to the school."
AG Wasden added that high school students 18 and older have the
same right to opt out of completing the surveys.
NRCCUA provides its surveys to high school teachers and guidance
counselors and requests that the surveys be given to students to
complete. Students may also complete the survey over the
Internet. The surveys ask students for personal information,
such as their name, address, gender, grade point average, date
of birth, academic and occupational interests, racial or ethnic
background, and, in the event the student is interested in
attending a college with a religious affiliation, the
denomination of their choice.
Under terms of the settlement, NRCCUA agreed:
(1) Not to misrepresent how personally identifiable
information will be collected, used or disclosed, or
how the collection of the information is funded;
(2) To clearly and conspicuously disclose why it collects
personal information and the types of entities to which
the information is disclosed;
(3) To make such disclosures in all of its privacy
statements and in all questionnaires, survey
instruments, and other documents;
(4) To cease all future use of survey data collected from a
student if a parent (in the case of a minor) or an
adult high school student requests that the student be
opted-out of completing the survey or that NRCCUA cease
using previously collected information;
(5) To supply schools with a notice form to be given to
parents telling them the survey may be administered and
how to opt their student-children out of completing the
survey if NRCCUA changes its current practice and
resumes using or permitting others to use its survey
data for non-educational-related marketing purposes;
NRCCUA did not admit any violations in settling the matter but
agreed to change its practices as required by the settlement.
NRCCUA stated in the settlement document that, in 2002, it
ceased permitting use of the student data for marketing purposes
not related to education.
For more information, contact Bob Cooper of the Office of
Attorney General Lawrence Wasden by Phone: (208) 334-4112
NORTEL NETWORKS: Investors File Suits Over Financial Revisions
--------------------------------------------------------------
Nortel Networks Corporation continues to face litigation filed
against it, subsequent to the Company's February 15, 2001
announcement in which it provided revised guidance for financial
performance for the 2001 fiscal year and the first quarter of
2001.
The Company and certain of its then current officers and
directors were named as defendants in more than twenty-five
purported class action lawsuits. These lawsuits were filed in
the U.S. District Courts for the Eastern District of New York,
for the Southern District of New York and for the District of
New Jersey and the provinces of Ontario, Quebec and British
Columbia in Canada, on behalf of shareholders who acquired
Nortel Networks Corporation securities as early as October 24,
2000 and as late as February 15, 2001. The suits allege, among
other things, violations of U.S. federal and Canadian provincial
securities laws. These matters also have been the subject of
review by Canadian and U.S. securities regulatory authorities.
On May 11, 2001, the defendants filed motions to dismiss and/or
stay in connection with the three proceedings in Quebec
primarily based on the factual allegations lacking substantial
connection to Quebec and the inclusion of shareholders resident
in Quebec in the class claimed in the Ontario lawsuit. The
plaintiffs in two of these proceedings in Quebec obtained court
approval for discontinuances of their proceedings on January 17,
2002. The motion to dismiss and/or stay the third proceeding
was heard on November 6, 2001 and the court deferred any
determination on the motion to the judge who will hear the
application for authorization to commence a class proceeding.
On December 6, 2001, the defendants filed a motion seeking leave
to appeal that decision. The motion for leave to appeal was
dismissed on March 11, 2002. On October 16, 2001, an order in
the Southern District of New York was filed consolidating
twenty-five of the related U.S. class action lawsuits into a
single case, appointing class plaintiffs and counsel for such
plaintiffs. The plaintiffs served a consolidated amended
complaint on January 18, 2002.
On December 17, 2001, the defendants in the British Columbia
action served notice of a motion requesting the court to decline
jurisdiction and to stay all proceedings on the grounds that
British Columbia is an inappropriate forum. The motion has been
adjourned at the plaintiffs' request to a future date to be set
by the parties.
A class action lawsuit against the Company was also filed in the
U.S. District Court for the Southern District of New York on
behalf of shareholders who acquired the securities of JDS
Uniphase between January 18, 2001 and February 15, 2001,
alleging violations of the same U.S. federal securities laws as
the above-noted lawsuits.
On April 1, 2002, Nortel Networks filed a motion to dismiss both
the above-consolidated U.S. shareholder class action and the
above JDS shareholder class action complaints on the grounds
that they failed to state a cause of action under U.S. federal
securities laws. With respect to the JDS shareholder class
action complaint, Nortel Networks also moved to dismiss on the
separate basis that JDS shareholders lacked standing to sue
Nortel Networks. On January 3, 2003, the District Court granted
the motion to dismiss the JDS shareholder class action complaint
and denied the motion to dismiss the consolidated U.S. class
action complaint. Plaintiffs appealed the dismissal of the JDS
shareholder class action complaint.
On November 19, 2003, oral argument was held before the Second
Circuit on the JDS shareholders' appeal of the dismissal of
their complaint. On May 19, 2004, the Second Circuit issued an
opinion affirming the dismissal of the JDS shareholder class
action complaint and on July 14, 2004 the Second Circuit denied
plaintiffs' motion for rehearing. On October 12, 2004, the
plaintiffs filed a petition for writ of certiorari in the U.S.
Supreme Court. On November 12, 2004, the defendants filed Brief
for the Respondents in Opposition, and on November 22, 2004, the
plaintiffs filed Reply to Brief in Opposition.
With respect to the consolidated U.S. shareholder class action,
the plaintiffs served a motion for class certification on March
21, 2003. On May 30, 2003, the defendants served an opposition
to the motion for class certification. Plaintiffs' reply was
served on August 1, 2003. The District Court held oral
arguments on September 3, 2003 and issued an order granting
class certification on September 5, 2003. On September 23,
2003, the defendants filed a motion in the Second Circuit for
permission to appeal the class certification decision.
The plaintiffs' opposition to the motion was filed on
October 2, 2003. On November 24, 2003, the Second Circuit
denied the motion. On March 10, 2004, the District Court
approved the form of notice to the class, which was published
and mailed.
On July 17, 2002, a new purported class action lawsuit was filed
in the Ontario Superior Court of Justice, Commercial List,
naming Nortel Networks, certain of its current and former
officers and directors and its auditors as defendants. The
factual allegations in the Ontario Claim are substantially
similar to the allegations in the consolidated amended complaint
filed in the U.S. District Court described above.
The Ontario Claim is on behalf of all Canadian residents who
purchased Nortel Networks Corporation securities (including
options on Nortel Networks Corporation securities) between
October 24, 2000 and February 15, 2001. The plaintiffs claim
damages of Canadian $5,000, plus punitive damages in the amount
of Canadian $1,000, prejudgment and post-judgment interest and
costs of the action.
On September 23, 2003, the Court issued an order allowing the
plaintiffs to proceed to amend the Ontario Claim and requiring
that the plaintiffs serve class certification materials by
December 15, 2003. On September 24, 2003, the plaintiffs filed
a notice of discontinuance of the original action filed in
Ontario. On December 12, 2003, plaintiffs' counsel requested an
extension of time to January 21, 2004 to deliver class
certification materials. On January 21, 2004, plaintiffs'
counsel advised the Court that the two representative plaintiffs
in the action no longer wished to proceed, but counsel was
prepared to deliver draft certification materials pending the
replacement of the representative plaintiffs.
On February 19, 2004, the plaintiffs' counsel advised the Court
of a potential new representative plaintiff. On February 26,
2004, the defendants requested the Court to direct the
plaintiffs' counsel to bring a motion to permit the withdrawal
of the current representative plaintiffs and to substitute the
proposed representative plaintiff. On June 8, 2004, the Court
signed an order allowing a Second Fresh as Amended Statement of
Claim that substituted one new representative plaintiff, but did
not change the substance of the prior claim.
NORTEL NETWORKS: Asks NY Court To Dismiss Securities Fraud Suit
---------------------------------------------------------------
Nortel Networks Corporation asked the United States District
Court for the Southern District of New York to dismiss the
consolidated securities class action filed against it and
certain of its then current and former officers and directors.
Subsequent to the March 10, 2004 announcement in which Nortel
Networks indicated it was likely that it would need to revise
its previously announced unaudited results for the year ended
December 31, 2003, and the results reported in certain of its
quarterly reports for 2003, and to restate its previously filed
financial results for one or more earlier periods, the Company
and certain of its then current and former officers and
directors were named as defendants in 27 purported class
action lawsuits.
These lawsuits, filed in the U.S. District Court for the
Southern District of New York on behalf of shareholders who
acquired Nortel Networks Corporation securities as early as
February 16, 2001 and as late as May 15, 2004, allege, among
other things, violations of U.S. federal securities laws. These
matters are also the subject of investigations by Canadian and
U.S. securities regulatory and criminal investigative
authorities.
On June 30, 2004, the Court signed Orders consolidating the 27
class actions and appointing lead plaintiffs and lead counsel.
The plaintiffs filed a consolidated class action complaint on
September 10, 2004, alleging a class period of April 24, 2003,
through and including April 27, 2004. On November 5, 2004,
Nortel Networks Corporation and the Audit Committee Defendants
filed a motion to dismiss the consolidated class action
complaint.
The suit is styled "In re NORTEL NETWORKS CORPORATION SECURITIES
LITIGATION, case no. 1:04-cv-02115-GBD," filed in the United
States District Court for the Southern District of New York
under Judge George B. Daniels.
Lawyer for the Company is Elizabeth Robin Weiss of Shearman &
Sterling LLP (New York), 599 Lexington Avenue, New York, NY
10022, Phone: 212 848-5086, Fax: 646 848-5086, E-mail:
elizabeth.weiss@shearman.com. The plaintiff firms in this
litigation are:
(1) Berger & Montague, P.C., 1622 Locust Street,
Philadelphia, PA, 19103, Phone: 800.424.6690, Fax:
215.875.4604, E-mail: investorprotect@bm.net;
(2) Berman, DeValerio, Pease, Tabacco Burt & Pucillo (MA),
One Liberty Square, Boston, MA, 2109, Phone:
617.542.8300, Fax; 617.230.0903, E-mail:
info@bermanesq.com
(3) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com;
(4) Cauley Geller Bowman Coates & Rudman, LLP (New York),
200 Broadhollow, Suite 406, Melville, NY, 11747, Phone:
631.367.7100, Fax: 631.367.1173,
(5) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com
(6) Chitwood & Harley, 1230 Peachtree Street, N.E., 2900
Promenade II, Atlanta, GA, 30309, Phone: 888.873.3999,
(7) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(8) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(9) Wechsler Harwood LLP, 488 Madison Avenue 8th Floor, New
York, NY, 10022, Phone: 212.935.7400, E-mail:
info@whhf.com
(10) Weiss & Yourman (New York, NY), The French Building,
551 Fifth Ave., Suite 1600, New York, NY, 10126, Phone:
212.682.3025, Fax: 212.682.3010, E-mail: info@wyca.com
(11) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, e-mail:
newyork@whafh.com
NORTEL NETWORKS: Faces Consolidated ERISA Violations Suit in TN
---------------------------------------------------------------
Nortel Networks Corporation faces a consolidated class action
filed in the United States District Court for the Middle
District of Tennessee, alleging violations of the Employee
Retirement Income Security Act (ERISA).
A purported class action lawsuit was filed on December 21, 2001,
on behalf of participants and beneficiaries of the Nortel
Networks Long-Term Investment Plan (the "Plan") at any time
during the period of March 7, 2000 through the filing date and
who made or maintained Plan investments in Nortel Networks
Corporation common shares. The suit seeks Plan-wide relief and
alleges, among other things, material misrepresentations and
omissions to induce Plan participants to continue to invest in
and maintain investments in Nortel Networks Corporation common
shares in the Plan.
A second purported class action lawsuit, on behalf of the Plan
and Plan participants for whose individual accounts the Plan
purchased Nortel Networks Corporation common shares during the
period from October 27, 2000 to February 15, 2001 and making
similar allegations was filed in the same court on March 12,
2002. A third purported class action lawsuit, on behalf of
persons who are or were Plan participants or beneficiaries at
any time since March 1, 1999 to the filing date and making
similar allegations, was filed in the same court on March 21,
2002. The first and second purported class action lawsuits were
consolidated by a new purported class action complaint, filed on
May 15, 2002 in the same court and making similar allegations,
on behalf of Plan participants and beneficiaries who directed
the Plan to purchase or hold shares of certain funds, which held
primarily Nortel Networks Corporation common shares, during the
period from March 7, 2000 through December 21, 2001.
On September 24, 2002, plaintiffs in the consolidated action
filed a motion to consolidate all the actions and to transfer
them to the U.S. District Court for the Southern District of New
York. The plaintiffs then filed a motion to withdraw the
pending motion to consolidate and transfer. The withdrawal was
granted by the District Court on December 30, 2002.
A fourth purported class action lawsuit, on behalf of the Plan
and Plan participants for whose individual accounts the Plan
held Nortel Networks Corporation common shares during the period
from March 7, 2000 through March 31, 2001 and making similar
allegations, was filed in the U.S. District Court for the
Southern District of New York on March 12, 2003. On March 18,
2003, plaintiffs in the fourth purported class action filed a
motion with the Judicial Panel on Multidistrict Litigation to
transfer all the actions to the Southern District of New York
for coordinated or consolidated proceedings pursuant to 28
U.S.C. section 1407.
On June 24, 2003, the Judicial Panel on Multidistrict Litigation
issued a transfer order transferring the Southern District of
New York action to the Middle District of Tennessee (the
"Consolidated ERISA Action"). On September 12, 2003, the
plaintiffs in all the actions filed a consolidated class action
complaint. On October 28, 2003, the defendants filed a motion
to dismiss the complaint and a motion to stay discovery pending
disposition of the motion to dismiss.
On March 30, 2004, the plaintiffs filed a motion for
certification of a class consisting of participants in, or
beneficiaries of, the Plan who held shares of the Nortel
Networks Stock Fund during the period from March 7, 2000 through
March 31, 2001. On April 27, 2004, the Court granted the
defendants' motion to stay discovery pending resolution of
defendants' motion to dismiss. On June 15, 2004, the plaintiffs
filed a First Amended Consolidated Class Action that added
additional current and former officers and employees as
defendants and expanded the purported class period to extend
from March 7, 2000 through to June 15, 2004.
On May 18, 2004, a purported class action lawsuit was filed in
the U.S. District Court for the Middle District of Tennessee on
behalf of participants and beneficiaries of the Plan at any time
during the period of December 23, 2003 through the filing date
and who made or maintained Plan investments in Nortel Networks
Corporation common shares, under the ERISA for Plan-wide relief
and alleging, among other things, breaches of fiduciary duty.
On September 3, 2004, the Court signed a stipulated order
consolidating this action with the Consolidated ERISA Action
described above.
On June 16, 2004, a second purported class action lawsuit, on
behalf of the Plan and Plan participants for whose individual
accounts the Plan purchased Nortel Networks Corporation common
shares during the period from October 24, 2000 to June 16, 2004,
and making similar allegations, was filed in the U.S. District
Court for the Southern District of New York. On August 6, 2004,
the Judicial Panel on Multidistrict Litigation issued a
conditional transfer order to transfer this action to the U.S.
District Court for the Middle District of Tennessee for
coordinated or consolidated proceedings pursuant to 28 U.S.C.
section 1407 with the Consolidated ERISA Action described above.
On August 20, 2004, plaintiffs filed a notice of opposition to
the conditional transfer order with the Judicial Panel. On
December 6, 2004, the Judicial Panel denied the opposition and
ordered the action transferred to the U.S. District Court for
the Middle District of Tennessee for coordinated or consolidated
proceedings with the Consolidated ERISA Action described above.
The suit is styled "In re: Nortel Networks Corp ERISA
Litigation, case no. 03-MD-1537," filed in the United States
District Court for the Middle District of Tennessee, under Judge
John T. Nixon.
NORTEL NETWORKS: Investors File Stock Lawsuits in Canadian Court
----------------------------------------------------------------
Nortel Networks Corporation, Nortel Networks Limited (NNL) and
certain directors and officers, and certain former directors and
officers, of Nortel Networks and NNL, face a purported class
proceeding in the Ontario Superior Court of Justice on behalf of
shareholders who acquired Nortel Networks Corporation securities
as early as November 12, 2002 and as late as July 28, 2004.
This lawsuit alleges, among other things, breaches of trust and
fiduciary duty, oppressive conduct and misappropriation of
corporate assets and trust property in respect of the payment of
cash bonuses to executives, officers and employees in 2003 and
2004 under the Nortel Networks Return to Profitability bonus
program and seeks damages of Canadian $250 and an order under
the Canada Business Corporations Act directing that an
investigation be made respecting these bonus payments.
PAYPERACTION LLC: TX AG Commences Lawsuit Over Unwanted E-mails
---------------------------------------------------------------
Texas Attorney General Greg Abbott filed the state's first
lawsuit against one of the world's largest spam operations in an
effort to crack down on the massive flow of illegal e-mail into
Texas consumers' in-boxes.
Ryan Samuel Pitylak, a University of Texas at Austin student,
and Mark Stephen Trotter of California, are named in the
Attorney General's federal complaint as controlling PayPerAction
L.L.C., Leadplex L.L.C. and Leadplex Inc., three companies
registered in Nevada. One watchdog group, SpamHaus.org, ranks
the defendants as the fourth largest illegal spam operation in
the world.
"Spam is one of the most aggravating and pervasive problems
facing consumers today," said Attorney General Abbott.
"Unwanted, unsolicited e-mail clogs computers of Texas consumers
and Texas businesses, wasting precious time and money. Texans
are fed up, and today's action aims to give them relief by
shutting down one of the world's worst spam operations."
Attorney General Abbott was joined by Houston-area residents Joe
Shields and Bruce Paige. Mr. Shields said he has had to abandon
several personal e-mail accounts after they were overwhelmed
with thousands of spam e-mails. Mr. Paige receives about 150 to
200 spam e-mails every day, advertising everything from medical
products to mortgage refinancing. He said he has tried to set up
filters to delete incoming spam, but the strong filters
sometimes get rid of e-mail he didn't intend to throw away.
The complaint was filed under the federal Controlling the
Assault of Non-Solicited Pornography and Marketing Act of 2003
(CAN-SPAM), which carries penalties of $250 per violation, up to
$2 million. Attorney General Abbott is also alleging violations
of the Texas Electronic Mail and Solicitation Act, which allows
for penalties of up to $10 per unlawful e-mail or $25,000 per
day and the Texas Deceptive Trade Practices Act, which
authorizes penalties of up to $20,000 per violation.
One involved citizen, Dewey Coffman of Austin, has been an
instrumental player in Attorney General Abbott's investigation.
Mr. Coffman, who has significant expertise in spam filtering,
firewalls and other mechanisms to protect consumers, set up
"trap" e-mail accounts on his personal server to capture the
defendants' unsolicited e-mails. He archived and forwarded these
messages to investigators with the Office of the Attorney
General (OAG), who then pinpointed their origin.
Internet service providers and the Federal Trade Commission
(FTC) also supported the Attorney General's spam-fighting
efforts. Like Mr. Coffman, Microsoft Corp. forwarded to OAG
investigators e-mails captured in its trap e-mail accounts. In
only a six-month period last year, these undercover accounts
alone received 24,000 illegal e-mails sent by the defendants.
The FTC provided the OAG access to its database of spam
complaints.
Attorney General Abbott added: "I am grateful to all those who
assisted in our investigation. Through collaborative efforts
like these, we can more effectively fight the vast public menace
of spam."
Since Pitylak and Trotter established PayPerAction in 2002, it
has operated over 250 assumed names, leading Internet users to
believe they are being deluged by different companies soliciting
services. The defendants engaged in the common, but illegal,
practice of using misleading subject lines that give recipients
the false impression the e-mail contains information specific to
them. By law, such promotional e-mails must clearly indicate
they are advertisements and cannot use misleading subject line
to trick recipients into opening them.
When opened, most e-mails sent by the defendants contained
hyped-up language pitching mortgage refinancing services, even
though the defendants are not licensed in Texas to provide such
services. Consumers often responded to these e-mails by
providing additional information after being told their privacy
would be protected. Instead, the defendants sold the information
as sales leads to other companies for as much as $28 per lead.
In passing the CAN-SPAM law, Congress recognized spam as a
growing threat to the convenience and efficiency of e-mail.
Internet service providers reported to Congress that unsolicited
e-mail accounted for more than half of all e-mail traffic in
2003, up from an estimated 7 percent in 2001.
PERONA FARMS: Recalls Smoked Salmon Due To Listeria Content
-----------------------------------------------------------
Perona Farms is voluntarily recalling "Smoked Atlantic Salmon"
and flavored varieties in 4 oz., 8 oz., 12 oz., 16 oz., and
larger packages only of Lot #4328 because they have the
potential to be contaminated with Listeria monocytogenes.
Listeria monocytogenes is an organism, which can cause serious
and sometimes fatal infections in young children, frail or
elderly people, and others with weakened immune systems.
Although healthy individuals may suffer only short-term symptoms
such as high fever, severe headache, stiffness, nausea,
abdominal pain and diarrhea. Listeria infection can cause
miscarriages and stillbirths among pregnant women.
The recalled "Smoked Salmon" in question is Lot #4328 with an
expiration date of 1/29/05, 1/30/05, 1/31/05, 2/01/05, 2/02/05
or 2/03/05. Perona Farms is voluntarily recalling the lot that
has been produced of the Salmon, including Moroccan, Scampi,
Bacon, Ming-Tsai's, Gravelox, Czar and Pastrami Flavors as a
precautionary measure.
This product is mainly retail, sold through stores of
supermarket chains: Shop Rite, Price Chopper/Golub, Weis
Markets, Earth Fare and Publix. Stores of these chains are
located throughout the eastern United States. This product was
also sold through various Beverage and Party Stores, as well as,
Gourmet and Specialty Shops in the eastern United States.
Consumers may have also purchased the products directly from the
plant nationwide via phone or internet.
No illnesses have been reported in connection with this problem.
The potential for contamination was noted after a random
inspection by the Florida Department of Agriculture and Markets
revealed the presence of Listeria monocytogenes in a 4 oz.
package of "Smoked Atlantic Salmon."
Consumers that have purchased any of the above products with
Specific 4328 lot number are urged to return them to the place
of purchase for a full refund.
Consumers with questions may contact Perona Farms at
800-750-6190.
POLARIS INDUSTRIES: CPSC Imposes Civil Penalty Over ATV Defects
---------------------------------------------------------------
The U.S. Consumer Product Safety Commission (CPSC) provisionally
accepted a settlement that imposes CPSC's first civil penalty
for reporting violations involving all-terrain vehicles (ATVs).
Polaris Industries Inc., of Medina, Minn., has agreed to pay a
$950,000 penalty to settle allegations that the ATV manufacturer
failed to timely inform CPSC of serious defects and hazards in
certain models of the Company's ATVs. (Settlement Agreement and
Order - PDF)
CPSC conducted two investigations into the timeliness of
Polaris's reporting. In the first matter, Polaris manufactured
and sold 13,600 Scrambler, Sport and Xplorer 400 model ATVs. The
throttles on these ATVs can stick and prevent the machines from
slowing down or stopping, leading to loss of control and
crashes.
Between December 1998 and May 2000, Polaris learned of 88
reports of throttles sticking due to defects in the throttle
control, including 19 crashes or other accidents. The Company
also had seven reports of injuries, including a dislocated hip,
a broken shoulder, torn back muscles and scrapes and bruises.
Prior to reporting these incidents to CPSC, the Company
allegedly made three engineering changes to the ATVs in an
attempt to prevent the throttles from sticking. Polaris reported
to CPSC in May 2000 and announced a recall in August 2000.
In the second matter, Polaris manufactured and sold 55,500
Xpedition, Trail Boss and Magnum 325 model ATVs. The oil lines
on these ATVs blew off, disconnected or loosened, resulting in
the spraying of hot pressurized oil. This presented the risk of
fires, burns, other injuries and death.
Between March 1999 and February 2001, Polaris received nearly
1,450 reports of oil line blow-offs, disconnections and leaks
resulting from the oil line defect. In 61 reports, the
discharging oil caused smoke, fire, melting and accidents, and
42 of those 61 reports involved ATV fires or the surrounding
area catching fire. Polaris received 18 reports of injuries,
including second- and third-degree burns, scarring, bruises and
scrapes.
Between February 2000 and January 2001, Polaris allegedly did
extensive analyses and made four engineering changes to the
defective ATVs without informing CPSC; and from May 2000 to
January 2001, the Company sent five alerts to its dealers about
the oil line defects without telling the government. Polaris
finally reported to CPSC in February 2001, a little more than a
month after CPSC asked the Company to report. Polaris announced
a recall of the ATVs in April 2001.
Federal law requires manufacturers, retailers and distributors
to report to CPSC immediately (within 24 hours) after obtaining
information reasonably supporting the conclusion that a product
contains a defect which could create a substantial risk of
injury to the public, presents an unreasonable risk of serious
injury or death, or violates a federal safety standard.
Although it agreed to pay a civil penalty, Polaris denies CPSC's
allegations and that it violated the law.
POUNDEX ASSOCIATES: Recalls 32,000 Chairs Due To Injury Hazard
--------------------------------------------------------------
Poundex Associates Corp., of City of Industry, California is
cooperating with the United States Consumer Product Safety
Commission by voluntarily recalling about 32,000 Residential
Dining Chairs.
The welds on the chair's rear legs can crack and break apart,
posing a fall hazard to consumers. Poundex Associates Corp. has
received one report of a chair breaking, involving one report of
a minor injury.
The recalled dining chair has a dark bronze metallic frame,
birch colored wooden back and gold colored upholstered seat. The
front and rear legs have a curved shape. The label under the
seat reads in part "Imported by Poundex Associates Corp." The
recalled dining chair is approximately 42-inches high and 17-
inches wide.
Manufactured in China, the chairs were sold at all independent
furniture stores nationwide from January 2004 through September
2004 for about $50 each. The recalled chairs were mainly sold as
part of a 5-piece dining set with a table for about $400 per
set.
Consumers should stop using the chairs immediately and contact
Poundex to receive a free rear leg replacement kit.
Consumer Contact: Contact Poundex Associate Corp. at
(800) 717-0484 anytime or visit http://www.poundex.comfor more
information.
REMEDIA LTD.: Tel Aviv Court Approves NIS7.25 Million Settlement
----------------------------------------------------------------
Uri Goren, the president of the Tel Aviv District Court,
approved the agreement settling three class action suits against
baby food marketer Remedia, Ltd. a settlement that the Israel
Consumer Council has opposed, calling it inadequate, the
Ha'aretz reports.
Mr. Goren, who had ruled that the settlement is reasonable and
had been achieved using proper procedure, decided not to wait
for Attorney General Menachem Mazuz to submit his official
opinion on the settlement, which is for a tiny fraction of the
amount originally demanded, after the attorney general postponed
filing his papers on several occasions.
The class actions in question all relate to mental anguish, not
to actual harm caused by the Remedia affair. Cases where
Remedia's soy-based formula caused death or nervous system
damage are still pending. Remedia and the manufacturer of the
baby food, Humana Milchunion of Germany, will pay the plaintiffs
NIS 7.25 million as compensation for their distress.
The agreement was reached in August 2004 and delivered to Mr.
Mazuz for scrutiny with certain changes being introduced into
its format in discussions between the families, the companies
and the prosecution.
The three class actions were filed shortly after the Remedia
affair hit the press in November 2003. They were based on
misrepresentation in labeling, which claimed the soy-based baby
formula contained the crucial vitamin B1, which it did not. The
first class action demanded NIS 115 million, the second a
billion shekels and the third, NIS 56 million.
Once the motions had been filed, the lawyers representing the
plaintiffs negotiated with Remedia's legal counsel until
arriving at the settlement. The parties decided that the parents
who deserved compensation had bought the soy formula from July
2003 to November 2003. To prove entitlement to compensation,
parents have to prove their children consumed the soy formula
during that period by filing a claim with a copy of the birth
certificate. They also need to show a receipt for the product or
a "real-time" confirmation from a doctor or from well baby
clinics that the child consumed the product in the relevant
period of time.
After discussions with the prosecution, the Company agreed to
accept alternative forms of real-time proof of consumption.
Parents have a 90-day window to file their claims.
Out of the NIS 7.25 million, NIS 4 million will be earmarked to
pay all the families found eligible, an amount that is based on
Remedia's sales figures for the relevant period of time.
The attorney general also made a contribution in the key to
distribution of the compensation. Originally the agreement
stated that children up to 1 year of age by November 7, 2003,
would receive maximum compensation of NIS 1,300 that sum,
however has risen to NIS 2,000. Children between 1 and 3 at that
date are eligible to receive up to NIS 800, instead of NIS 500.
Aside from the families, the NIS 7.25 million compensation,
which the council had hoped to shoot down on the grounds that it
fails to achieve its purposes, will also be split to give NIS 2
million to five public organizations, and NIS 1.1 million to the
various lawyers representing the claimants.
As previously reported in the November 15, 2004 edition of the
Class Action Reporter, the compromise Remedia delivered to the
Tel Aviv court for approval is designed to deflect three
consolidated class actions, which would cost Remedia and the
German firm, Humana Milchunion, which actually made the B1-
deficient soy formula, about NIS 7.25 million. Consumers
complaining that Remedia's labeling, which claimed vitamin B1 to
be present in the soy formula had misled them filed the class
actions. The consumers demanded their money back on the product
and compensation for mental anguish.
The Consumer Council had complained to the Tel Aviv District
Court that the compromises baby food maker Remedia, Ltd. reached
to deflect class actions after its vitamin-defective soy formula
killed three babies are not sufficiently deterrent. According to
the council, Remedia's consent to pay mental anguish
compensation of only NIS 500 to NIS 1,300 per family that used
the offending product contravenes court precedent. The
compensation does not relate to families whose babies were
killed or injured from the product, but to ones whose babies
imbibed the milk substitute without being harmed. The council
further told the Tel Aviv District Court, which has to rule on
the validity of the compromises that according to precedent,
anguish compensation of this kind should be in the range of
thousands of shekels per family, even above ten thousand
shekels.
SHAW GROUP: Shareholders Lodge Securities Fraud Suits in E.D. LA
----------------------------------------------------------------
The Shaw Group, Inc. and certain of its current officers face
purported shareholder class action lawsuits alleging violations
of federal securities laws in the United States District Court
for the Eastern District of Louisiana.
The first filed lawsuit is styled "Earl Thompson v. The Shaw
Group Inc. et al," and was filed on June 16, 2004, under Case
No. 04-1685. The complaint filed in the "Thompson" action
alleges claims under Sections 10(b) and Rule 10(b-5) promulgated
thereunder and 20(a) of the Securities Exchange Act of 1934 on
behalf of a class of purchasers of our common stock during the
period from October 19, 2000 to June 10, 2004.
The complaint alleges, among other things, that certain of the
Company's press releases and SEC filings contained material
misstatements and omissions, that the manner in which the
Company accounted for certain acquisitions was improper and that
it improperly recorded revenue on certain projects, and as a
result, its financial statements were materially misstated at
all relevant times. The complaint does not specify the amount
of damages sought.
Since the filing of the Thompson lawsuit, nine additional
purported shareholder class action lawsuits have been filed and
other actions may also be commenced. Each of the additional
lawsuits includes the same defendants, and essentially alleges
the same statutory violations based on the same or similar
alleged misstatements and omissions. All of these actions have
been consolidated under the Thompson caption in the Eastern
District of Louisiana and the Court has appointed a lead
plaintiff to represent the members of the purported class. The
consolidated actions have not been certified as class actions by
the Court.
In addition, two shareholder derivative actions, styled as
"Jonathan Nelson v. J.M. Bernhard, Jr., et al." and "Larry F.
Reusche v. Tim Barfield, Jr., et al.," have been filed based on
essentially the same allegations as the purported class actions.
The derivative actions, which the plaintiffs purport to be
bringing on behalf of the Company, name certain of our directors
and current and former officers as defendants, and name the
Company as a nominal defendant.
The derivative suits collectively make claims of breach of
fiduciary duty, abuse of control, gross mismanagement, waste of
corporate assets and unjust enrichment based on allegations that
the named defendants committed, condoned or failed to identify
and disclose the misconduct alleged in the purported class
action lawsuits, and that certain defendants sold Company stock
while in possession of knowledge of the alleged misconduct. The
complaints do not specify the amount of damages sought. These
derivative lawsuits have been stayed indefinitely by a court
order as of December 14, 2004.
The suit is styled "Thompson et al v. Shaw Group, Inc., et al,
case no. 04-CV-1685," filed in the United States District Court
for the Eastern District of Louisiana under Judge Helen G.
Berrigan.
Lawyers for the plaintiffs are:
(1) Peter E. Seidman, Milberg Weiss Bershad Hynes & Lerach
LLP, One Pennsylvania Plaza, New York, NY 10119-0165
Phone: (212) 594-5300
(2) Lewis Stephen Kahn, Kahn Gauthier Law Group, LLC, 650
Poydras St., Suite 2150, New Orleans, LA 70130, Phone:
504-455-1400
(3) Joel R. Waltzer, Waltzer & Associates, 14349 Chef
Menteur Hwy., P. O. Box 29423, Suite D, New Orleans, LA
70189, Phone: 504-254-4400
(4) Darren J. Robbins, Lerach Coughlin Stoia Geller Rudman
& Robbins LLP, 401 B Street, Suite 1700, San Diego, CA
92101, Phone: 619-231-1058
(5) John Donellan Fitzmorris, Jr., John D. Fitzmorris, Jr.,
Attorney at Law, 210 Baronne St., Suite 1122, New
Orleans, LA 70112, 504-586-9395
(6) David A. Rosenfeld, Lerach Coughlin Stoia Geller Rudman
& Robbins, LLP, 200 Broadhollow Rd., Suite 406,
Melville, NY 11747, Phone: 631-367-7100
Lawyers for the defendants are:
(i) Steven W. Copley, Gordon, Arata, McCollam, Duplantis &
Eagan LLP, 201 St. Charles Ave., Suite 4000, New
Orleans, LA 70170-4000, Phone: (504) 582-1111
(ii) J. J. (Jerry) McKernan, McKernan Law Firm, 8710
Jefferson Hwy., Baton Rouge, LA 70809, Phone: 225-926-
1234
(iii) Clifford Thau, Steven R. Paradise of Vinson & Elkins,
LLP, 666 Fifth Ave., 26th Floor, New York, NY 10103,
Phone: 212-237-0007
UNIVERSAL LIFE: CEO Influenced Prudential Financial's Exec Picks
----------------------------------------------------------------
A California consulting firm that is embroiled in the insurance
industry's broker-fee scandal had such influence at Prudential
Financial that it helped place executives in the Company,
according to new filings in a federal lawsuit, The Star-Ledger
reports.
The civil racketeering suit alleges that the chief executive of
Universal Life Resources, a San Diego-based firm that advises
large companies on insurance matters, played a role in the
hiring of Michael Witwer, a former MetLife executive who became
senior vice president of group products and marketing at
Prudential. Mr. Witwer, who has denied any wrongdoing, was one
of two employees suspended with pay in November as part of the
Newark-based insurer's internal review into its business
practices.
ULR is one of several insurance brokers under investigation by
state and federal authorities for alleged kickbacks and bid
rigging. New York Attorney General Eliot Spitzer filed suit
against the Company last year for practices that allegedly
inflated workers' and employers' premiums by tens of millions of
dollars. The California Insurance Commissioner has also filed a
similar action that also names Prudential as a defendant.
Originally filed in federal district court in California in
October, the civil racketeering suit class-action status for
employers and employees whose insurance premiums were affected
by ULR's allegedly hidden relationships with insurers.
The filings now incorporate many of Mr. Spitzer's charges, as
well as new allegations. According to the suit, Prudential and
other insurers, for example, allegedly attended annual meetings
sponsored by ULR in Las Vegas, where the consulting firm
dictated "the terms and amounts of compensation" it expected.
Furthermore the suit alleges that besides his role in Mr.
Witwer's move, ULR Chief Executive Douglas Cox also recommended
the hiring of Michael Prochno, another group life officer at
Prudential who came from UnumProvident. Mr. Cox and his firm
"moved executives from one preferred carrier to another to
influence the relationship with the new employer" and that ULR
directed some 50 percent of its business to MetLife, and 30
percent to Prudential, the suit states.
UNIVERSITY OF PHOENIX: Discovery Proceeds in CA Overtime Lawsuit
----------------------------------------------------------------
Discovery is proceeding in the class action filed against the
University of Phoenix, Inc. in the Superior Court of the State
of California for the County of Orange, captioned "Bryan Sanders
et. al. v. University of Phoenix, Inc. et. al., Case No.
03CC00430."
The Plaintiff, a former academic advisor with University of
Phoenix, filed this class action on behalf of himself and
current and former academic advisors employed by the Company in
the State of California and seek certification as a class,
monetary damages in unspecified amounts, and injunctive relief.
Plaintiff alleges that during his employment, he and other
academic advisors worked in excess of 8 hours per day or 40
hours per week, and contend that the Company failed to pay
overtime.
Two status conferences have occurred and the parties are now in
the process of discovery. A continued status conference is
scheduled in late January 2005.
VERIZON WIRELESS: Customers Lodge Suit in CA Over Phone Features
----------------------------------------------------------------
Verizon Wireless customers initiated a lawsuit seeking class
action status against the mobile service provider, claiming that
it is selling a cell phone with fewer Bluetooth short range
radio features than they expected, according to the plaintiffs'
lawyer, Reuters reports.
Filed in Los Angeles Superior Court, the lawsuit accuses Verizon
Wireless, which is owned by Verizon Communications and Vodafone,
of excluding some common Bluetooth features in the v710 phone
from Motorola Inc. Bluetooth is a revolutionary technology that
allows wireless links, within about 10 meters, between gadgets
such as phones, computers, printers and headsets. The links are
free when the devices are not connected to a cellular network at
the same time.
According to Michael Kelly, the Kirtland & Packard lawyer who
filed the suit, his clients expected Verizon to provide all the
Bluetooth features Motorola includes in its v710 products.
However, since Verizon Wireless doesn't enable Bluetooth for
uses such as photograph transfers between the v710 phone and
other gadgets, the lawsuit claims it is forcing users to use its
network for functions that would be free on Bluetooth. Mr.
Kelly, who wants class-action status for the suit, told Reuters,
"our allegation is that it's probably more than a coincidence
that the functions that are disabled can be replaced by Verizon
functions for which you pay extra."
However, both Verizon Wireless and Motorola disputed the
allegations and cited that it is common practice for mobile
service providers to determine the features included in phones
they sell. Motorola also added that Bluetooth doesn't always
involve free wireless connections. Motorola spokesman Alan
Buddendeck even points out, "Nobody in the industry has ever
said that Bluetooth would always be cost free. It will vary from
operator to operator." Verizon Wireless for its part explained
that its customers could connect the v710 phone with a Bluetooth
headset or laptop computer, while using its cellular network.
Telecom analyst Ed Snyder said service providers' decisions to
exclude new features on phones could stunt innovation. He
however, noted that lawsuits based on these moves are not likely
to succeed unless false advertising is involved. Mr. Snyder even
pointed out to Reuters, "the fact that people build Lamborghinis
that'll go 180 miles an hour and the dealer you buy it from is
offering a smaller engine ... doesn't mean you have the right to
sue the dealer."
VIRGINIA MASON: Patients Lodge Over-Billing Suit in WA
-------------------------------------------------------
Patients of Virginia Mason Medical Center in Seattle have
initiated a lawsuit seeking class-action status against the
hospital, claiming they were over-billed for routine procedures
done at its downtown clinic, the Associated Press reports.
Filed in King County Superior Court on behalf of Lori Mill and
DeLois Gibson, the lawsuit alleges unfair and deceptive
practices by Virginia Mason in charging patients more at one
clinic than another and not telling clients beforehand. Both
plaintiffs, who are friends and co-workers, are covered by
insurance plans that require they pay 20 percent of medical
costs.
According to the lawsuit, Ms. Mill was charged $1,133 for a 30-
second procedure to clip her toenail and send it to a lab for
tests. She questioned the charge and learned if she'd had the
same procedure done at a Kirkland clinic it would have cost $418
less. On the other hand, Ms. Gibson, the lawsuit states also had
a similar experience involving the same downtown clinic. She was
billed $1,451 to remove a small bump on her neck, which included
an $846 amount in miscellaneous hospital charges, the lawsuit
states. Ms. Gibson paid her bill, but Ms. Mill has not.
John Phillips, who said other Virginia Mason clients might have
been charged extra because they visited doctors in offices next
to the hospital, represents both women in the suit. Mr. Phillips
hopes to have the lawsuit certified as a class action against
the hospital. He has filed the lawsuit under the Washington
Consumer Protection Act, which could result in triple damages
being awarded each patient in the class, up to a maximum of
$10,000 per patient.
Hospital officials had not yet reviewed the lawsuit, said Patti
Crome, Virginia Mason senior vice president and clinic
administrator who said she could not comment. She told the
Associated Press, "We're obviously taking this very seriously.
We need some time to investigate what the issues are, and gather
the facts." She even states, "Virginia Mason is committed to
billing appropriately, and we believe our practices are
consistent with other clinics integrated with hospitals."
WAL-MART STORES: Recalls 600T GE Slow Cookers Due To Burn Hazard
----------------------------------------------------------------
Wal-Mart Stores Inc., of Bentonville, Arkansas and Hamilton
Beach/Proctor-Silex Inc., of Glen Allen, Virginia is cooperating
with the United States Consumer Product Safety Commission by
voluntarily recalling about 600,000 GE Oval and Double Dish Slow
Cookers.
The handles on the base of the slow cookers can break, posing a
risk of burns from hot food spilling onto consumers. Hamilton
Beach and Wal-Mart have received 531 reports of handles
breaking, including four reports of consumers who were burned by
hot food.
The recalled slow cookers include the 4.5-Quart Oval and 6-Quart
Double Dish models sold under the General Electric (GE) brand
name. The model name is printed on the front of the units. The
4.5-quart unit has model number 106661 and the 6-quart unit has
model number 106851. Both models have series codes A through D,
which are printed on the bottom along with the model number. The
base of the slow cookers is white with an olive or honeysuckle
graphic.
The slow cookers were sold at all Wal-Mart stores nationwide
from August 2000 through December 2002 for about $25 (4.5-quart
model) and $35 (6-quart model).
Consumers should stop using the product immediately and contact
Wal-Mart to receive a replacement slow cooker base.
Consumer Contact: Call the Wal-Mart Slow Cooker Recall Hotline
toll-free at (888) 293-3343 anytime or go to
http://www.walmart.com.
WASHINGTON: 9/11 Compensation Administrator Urges Legal Reform
--------------------------------------------------------------
Kenneth Feinberg, the official who ran the $7 billion government
compensation program for the victims of the September 11
attacks, said that a similar effort should be made to limit
asbestos liability class-action lawsuits, which is a legislative
priority this year for Republicans, the Associated Press
reports.
He particularly scolded Congress for not taking action on the
large number of asbestos claims working through the court
system. In a forum sponsored by the Manhattan Institute, a
conservative think tank, he stated, "it's a scandal that they
haven't passed an asbestos statute yet." He further adds, that
asbestos cases are unique because there are so many claims that
companies facing the lawsuits simply don't have enough money to
pay them all.
Mr. Feinberg faced strong criticism over program rules at the
outset of the September 11 compensation fund, but he was
generally praised by the time it shut down last summer. He has
done similar work on more conventional mass litigation claims,
including asbestos and the Vietnam-era herbicide Agent Orange.
Some advocates for limiting liability lawsuits contend that the
response to September 11 claims may provide a benchmark for
resolving massive class-action lawsuits over products like
asbestos or prescription drugs.
Senate Judiciary Chairman Arlen Specter, R-Pa., who is pushing
legislation to ban asbestos liability lawsuits in exchange for a
multibillion-dollar compensation fund, has said that his goal
for this year is to put a stop to the stream of lawsuits over
asbestos that drives companies out of business and leaves
victims with little help to pay medical bills.
Asbestos is a fibrous mineral used often until the mid-1970s in
insulation and fireproofing material, its fibers can cause
cancer and other ailments when inhaled.
WASHINGTON: Court Ruling Could Lead To Deportations Of Somalis
--------------------------------------------------------------
Somalis who are facing deportation could find comfort in a 2003
federal judge's ruling that they could not be sent back to the
East African nation, Somalia, lacking a functioning central
government, could not accept deportees and thus deportations to
the country would be illegal, Seattle attorneys had argued, the
Seattle Times Reports.
Further enforcing the attorneys' arguments was an injunction
that halted such deportations, which was issued by U.S. District
Judge Marsha Pechman. Her ruling would later be upheld in a 2-1
decision by a panel of the 9th U.S. Circuit Court of Appeals.
However, in a stunning reversal, the U.S. Supreme Court, in a 5-
4 decision, ruled the United States does not need the advance
consent of a foreign country before deporting someone, a
decision that opens the door to deportation of about 8,000 of
the Somalis living throughout the country.
Asked how quickly deportations to Somalia might occur, a
spokesman for Immigration and Customs Enforcement said the
agency was examining the ruling.
The petitioner in the Supreme Court case is Keyse G. Jama, who
was admitted to the United States as a refugee in 1996, he was
later convicted of felony assault in a Minnesota state court,
and his refugee status revoked in 2000.
Seattle attorneys had been keeping close watch, knowing that a
decision by the Supreme Court could lead to the removal of the
federal court injunction.
Nick Gellert, an attorney with Perkins Coie in Seattle, the firm
that had been handling the local Somali case pro bono, called
the high court's decision "disappointing." That case, initially
filed on behalf of five Somali nationals, later was certified as
a class-action case. Attorneys had argued that Somalis faced
torture and death if sent back to the war-ravaged country. Mr.
Gellert told the Seattle Times, "It's almost ironic that at the
same time we're spending billions on tsunami-relief efforts,
including to those people on the coast of Somalia, that the
government would turn around and put more people in grave risk."
Though the number of local Somalis who might now be deported is
unknown, the state's entire Somali population is estimated to be
25,000, the third highest in the country after Minnesota and
Ohio.
As word of the high court's decision spread, Hate Free Zone, a
Seattle organization that advocates for immigrant rights,
fielded about a dozen phone calls from Somalis in immigration
detention and from other family members. "It's just
devastating," said Pramila Jayapal, Hate Free Zone executive
director.
New Securities Fraud Cases
CONEXANT SYSTEMS: Milberg Weiss Launches Securities Suit in NJ
--------------------------------------------------------------
Milberg Weiss Bershad & Schulman LLP initiated a securities
class action on behalf of purchasers of the securities of
Conexant Systems, Inc. (Nasdaq: CNXT) between March 1, 2004 and
November 4, 2004, inclusive seeking to pursue remedies under the
Securities Exchange Act of 1934. The action is pending in the
United States District Court for the District of New Jersey
against defendants Conexant, Dwight W. Decker (Chairman),
Armando Geday (CEO) and J. Scott Blouin (Chief Accounting
Officer).
The complaint alleges that defendants' Class Period
representations about the Company's operations, made in Conexant
press releases, were materially false and misleading because
they failed to disclose the following adverse facts:
(1) that the Company was stuffing the channel with
products, such that its revenues did not reflect the
true, end-user demand for its products;
(2) that the Company's inventory glut would lead to lowered
revenues as distributors and retailers would need to
exhaust existing inventory before purchasing new
products from Conexant;
(3) that the combined Company was suffering from serious
operating deficiencies, particularly in the wireless
local area network ("WLAN") division of Globespan that
was not effectively integrated into the combined
Company's operations, causing the Company to lose its
leadership position in the WLAN market;
(4) that, contrary to defendants express representations
that the Globespan integration was "on schedule" and
that "outstanding progress" was being made in that
regard, integration of the Globespan acquisition was
mishandled, causing such a massive drain on the Company
that, by the end of the Class Period, the outlook for
the much larger combined Company was worse than
Conexant's stand-alone prospects.
On November 4, 2004, defendants issued a press release
announcing disappointing results for the fourth quarter of 2004,
including a loss of $367.5 million ($0.79 per share) which was
blamed on poor demand, inventory buildup and failed product
launches. Later that day, the Company held a conference call to
discuss its fourth quarter results. Defendant Geday's response
to an analyst's question revealed that the Company's inventory
glut was not a recent phenomenon, but had been building for as
long as five quarters. In reaction to the Company's press
release and conference call, the price of Conexant securities
dropped to $1.60 per share on November 5, 2004 from $1.76 on
November 4, 2004.
As detailed in the complaint, earlier announcements that only
partially disclosed the facts about Conexant's business had
already taken a heavy toll on Conexant's stock price, which
traded as high as $7.77 per share during the Class Period.
For more details, contact Steven G. Schulman, Peter E. Seidman
and Andrei V. Rado, by Mail: One Pennsylvania Plaza, 49th fl.
New York, NY, 10119-0165, by Phone: (800) 320-5081 by E-mail:
sfeerick@milbergweiss.com or visit the firm's Website:
http://www.milbergweiss.com
CONEXANT SYSTEMS: Schiffrin & Barroway Files Stock Suit in NJ
-------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
District of New Jersey on behalf of all securities purchasers of
the publicly traded securities of Conexant Systems, Inc.
(NASDAQ:CNXT) ("Conexant" or the "Company") during the period
between March 1, 2004 and November 4, 2004 (the "Class Period"),
and former GlobespanVirata, Inc. ("Globespan") shareholders who
received shares of Conexant in the merger.
The complaint charges Conexant, Dwight W. Decker, and Armando
Geday with violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. More specifically, the Complaint alleges that the
Company failed to disclose and misrepresented the following
material adverse facts known to defendants or recklessly
disregarded by them:
(1) that the merger between Conexant and GlobespanVirata
was plagued by integration problems;
(2) that the performance of the Company's WLAN unit, the
top producer of WLAN chips, was being materially
impacted by the GlobespanVirata merger rather than a
merely difficult market;
(3) that the integration issues with the merger caused the
Company to experience diminished revenue streams as
demand for products diminished;
(4) that Conexant remained vulnerable to the effects of
weak bargaining power, commoditization and pricing
pressures across most of its product portfolio, despite
the Company's continuing efforts to achieve
differentiation based on product features and
functionalities in several main target markets; and
(5) that as a result of the above, the defendants' fiscal
projections were lacking in any reasonable basis when
made.
On July 6, 2004, Conexant announced that it expected revenues
for its third fiscal quarter, which ended July 2, 2004, to be
lower than anticipated due primarily to weakness in its wireless
local area network ("WLAN") business. The news shocked the
market. Shares of Conexant fell $1.77 per share, or 43.38
percent, on July 6, 2004, to close at $2.31 per share. On
November 4, 2004, Conexant released its financial and
operational results for the fourth quarter ended October 1,
2004. Fourth fiscal quarter 2004 revenues of $213.1 million
decreased 20 percent from the third fiscal quarter revenues of
$267.6 million. This announcement sent shares of Conexant
tumbling $0.16 per share, or 9.09 percent on November 5, 2004,
to close at $1.60 per share.
For more details, contact of 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.
INPUT/OUTPUT INC.: Charles J. Piven Lodges Securities Suit in TX
----------------------------------------------------------------
The Law Offices Of Charles J. Piven, P.A. initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of
Input/Output, Inc. (NYSE:IO) between May 10, 2004 and January 4,
2005, inclusive (the "Class Period").
The case is pending in the United States District Court for the
Southern District of Texas against defendant Input/Output, Inc.
and one or more of its officers. The action charges that
defendants violated federal securities laws by issuing a series
of materially false and misleading statements to the market
throughout the Class Period, which statements had the effect of
artificially inflating the market price of the Company's
securities. No class has yet been certified in the above action.
For more details, contact the Law Offices Of Charles J. Piven,
P.A. by Phone: The World Trade Center-Baltimore, 401 East Pratt
Street, Suite 2525, Baltimore, Maryland 21202 by Phone:
410/986-0036 or by E-mail: hoffman@pivenlaw.com.
JAKKS PACIFIC: Lerach Couglin Updates NY Securities Fraud Suit
--------------------------------------------------------------
Lerach Coughlin Stoia Geller Rudman & Robbins LLP updated the
securities class action filed in the United States District
Court for the Southern District of New York on behalf of
purchasers of JAKKS Pacific, Inc. ("JAKKS") (NASDAQ:JAKK) common
stock during the period between February 17, 2004 and October
19, 2004.
The complaint charges JAKKS and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. JAKKS describes itself as a multi-line, multi-brand toy
company that designs, develops, produces and markets toys and
related products.
The complaint alleges that, throughout the Class Period,
defendants issued numerous positive statements concerning the
increasing sales of JAKKS's products licensed through the World
Wrestling Entertainment Inc. ("WWE"). As alleged in the
complaint, these statements were materially false and misleading
because defendants knew, but failed to disclose:
(1) that the WWE was contending that the WWE licenses had
been obtained through a pattern of commercial bribery;
(2) that the Company's relationship with the WWE was being
negatively impacted by the WWE's contention that the
licenses it had granted to the Company were improperly
obtained; and
(3) given the foregoing, the Company was subject to the
heightened risk that the WWE would seek some
modification to its WWE licensing agreements or
complete nullification of those agreements, which would
negatively impact the Company's future financial
results.
On October 19, 2004, JAKKS issued a press release announcing
that it was "engaged in discussions with WWE concerning the
restructuring of its toy license and with WWE and THQ with
respect to the restructuring of the JAKKS THQ Joint Venture
video games license agreement with WWE." In response to the
announcement of the problems with the WWE licenses, the price of
JAKKS stock declined from $24.15 per share to $18.81 per share.
Then, after the market closed for trading, it was reported that
the WWE had just filed a lawsuit against JAKKS which alleged
that the videogame license and certain toy licenses that the WWE
previously granted to JAKKS were obtained through a pattern of
racketeering and commercial bribery and seeking, among other
things, that the licensing agreements be declared void.
Following this announcement, on the next day of trading, the
price of JAKKS common stock continued to fall to close at $12.96
per share on extremely heavy trading volume.
Subsequent to the filing of the complaint, on November 16, 2004,
JAKKS issued a press release announcing that it entered into a
worldwide licensing agreement with WWE to develop and market
WWE(R) TV Games. The press release gave the impression that
JAKKS and WWE had resolved their differences. However, it was
later disclosed, by WWE, that the deal was only an amendment to
an earlier agreement that is now in dispute and the litigation
between the two companies is continuing.
For more details, contact Samuel H. Rudman or David A. Rosenfeld
of Lerach Coughlin by Phone: 800/449-4900 or 619/231-1058 by E-
mail: wsl@lerachlaw.com or visit the firm's Website:
http://www.lerachlaw.com.
OFFICEMAX INC.: Lerach Coughlin Lodges Securities Suit in IL
------------------------------------------------------------
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 Northern District of Illinois on
behalf of purchasers of OfficeMax Inc. ("OfficeMax") (NYSE:OMX)
publicly traded securities during the period between November 9,
2004 and January 11, 2005 (the "Class Period").
The complaint charges OfficeMax and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. OfficeMax, formerly Boise Cascade Corporation, is a
multinational contract and retail distributor of office supplies
and paper, technology products and office furniture.
The complaint alleges that during the Class Period, defendants
made false and misleading statements regarding the Company's
earnings. 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 for a period of at least two years, millions of
dollars worth of the Company's sales were fraudulently
booked as legitimate sales;
(2) that the Company was using (and manipulating its use
of) "vendor allowances" (monies paid by suppliers for
promotions, prime shelf space, discounts and rebates)
in order to manipulate the Company's earnings and
timing of revenue recognition;
(3) that the Company's Q4 2004 results and those beyond
were being eroded by the Company's internal
investigation costs and the halting of the Company's
abusive vendor allowance scheme;
(4) that the Company lacked the necessary internal controls
to insure all revenue reported complied with generally
accepted accounting principles; and
(5) that the Company had entered into a long term-paper
supply contract with Boise Cascade, LLC, which,
unbeknownst to investors, was not commensurate with the
market rate.
As a result of defendants' false statements, OfficeMax shares
traded at inflated levels during the Class Period, increasing to
as high as $32.52 on December 16, 2004, whereby the Company's
top officers and directors arranged to sell nearly $1.5 billion
worth of the Company's notes.
On January 12, 2005, OfficeMax announced that its chief
financial officer had resigned and that it would postpone the
release of its earnings for the fourth quarter and full year
2004, pending the conclusion of an internal investigation into
issues relating to its accounting for vendor income.
For more details, contact William Lerach or Darren Robbins of
Lerach Coughlin by Phone: 800/449-4900 or 619/231-1058 by E-
mail: wsl@lerachlaw.com or visit their Web site:
http://www.lerachlaw.com/cases/officemaxinc/.
OFFICEMAX INC.: Schiffrin & Barroway Files Securities Suit in IL
----------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
Northern District of Illinois on behalf of all securities
purchasers of OfficeMax Incorporated (NYSE: OMX) ("OfficeMax" or
the "Company") between January 22, 2004 and January 11, 2005,
inclusive (the "Class Period").
The complaint charges OfficeMax, George Harad, Christopher
Milliken, and Ted Crumley with violations of the Securities
Exchange Act of 1934. 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 certain employees of the Company fabricated
supporting documentation for approximately $3.3 million
in claims billed to a vendor of OfficeMax during 2003
and 2004;
(2) that the Company improperly timed the recognition of
recorded rebates and other such payments from vendors;
(3) that the Company's financial results were in violation
of Generally Accepted Accounting Principles ("GAAP");
(4) that the Company lacked adequate internal controls; and
(5) that as a result of the above, the Company's financial
results were materially inflated at all relevant times.
On January 12, 2005, OfficeMax announced that Brian Anderson,
executive vice president and chief financial officer, had
resigned. Ted Crumley, the former chief financial officer of
OfficeMax, will return to that position on an interim basis.
Furthermore, OfficeMax announced that it would postpone the
release of its earnings for the fourth quarter and full year
2004, pending the conclusion of an internal investigation into
issues relating to its accounting for vendor income.
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.
PFIZER INC.: Scott + Scott Lodges Securities Fraud Suit in CT
-------------------------------------------------------------
The law firm of Scott + Scott, LLC initiated a class action
lawsuit against Pfizer, Inc. (NYSE:PFE) in the United States
District Court for the District of Connecticut on behalf of
those who purchased or acquired Pfizer, Inc. securities from
October 31, 2000 to December 16, 2004 (the "Class Period").
The lawsuit against Pfizer alleges the Company violated the
federal securities laws by issuing materially false and
misleading statements during the Class Period. New prescriptions
for Pfizer's pain killer Celebrex(R), the leader in a class of
drugs called cox-2 inhibitors, plummeted 56% last week just
after a federal study found a link between Celebrex(R) and a
heightened risk of heart attacks and strokes. This lawsuit also
names individual defendants Henry A. McKinnell who was Chairman
of the Board and Chief Executive Officer and John L. LaMattina,
who was President of Global Research and Development of Pfizer.
Specifically, as stated in the complaint, LaMattina was
responsible for scientific reporting concerning the safety of
Celebrix. This lawsuit comes just months after the firm filed a
lawsuit on behalf of the employees, former employees and
beneficiaries of Merck (NYSE:MRK) to protect their pension
benefits.
The suit was filed on behalf of Pfizer shareholders everywhere
due to its belief that, the Company, according to the complaint,
employs well over 4,000 workers at the facilities in New London,
CT and Groton, CT. Scott + Scott further states that the "world-
class, $294-million Pfizer Global Research & Development (PGRD)
headquarters can house up to 2,000 highly skilled employees. In
addition to senior management of the Research & Development
division, the facility serves as the center for the Company's
global development team, responsible for demonstrating the
effectiveness and safety of drugs through clinical trials", such
as the introduction of Celebrex.
According to the allegations, Pfizer Inc. said it found an
increased risk of heart attacks and strokes for patients taking
high dosages of its top-selling arthritis painkiller Celebrex,
the same problem that led to the withdrawal of its one-time
competitor Vioxx--made by Merck. The Company has since stated
that it has no plans to remove Celebrex(R) from the market, but
the disclosure last Friday sent Pfizer's shares tumbling because
of fears that it could cripple sales of what had been the most-
prescribed drug for treating arthritis, causing shareholders to
bring this action.
Shares of Pfizer, a member of the Dow index and the world's
largest pharmaceutical maker, plunged $3.23, or 11.15 percent,
to $25.75 upon this announcement. The complaint states that at
the time of the announcement, the decline wiped out almost $25
billion of Pfizer's market value. Both Pfizer's Celebrex(R) and
Merck's Vioxx(R) are a type of drug called cox-2 inhibitors.
Vioxx was pulled from the market in September because it doubled
patients' risk of heart attack and strokes. Further, in an
independent National Cancer Institute study of 2000 patients,
not done by Pfizer, 15 individuals taking 400 mgs, 20 patients
taking 800 mgs and 6 patients on a placebo suffered a cardiac-
related death, heart attack or stroke.
The complaint alleges that in a separate study done by Pfizer,
the Company found no increased heart risk with patients taking
400mg of Celebrex(R) per day. Further it is alleged that those
safety claims may cause problems for Pfizer--citing recent
Company statements, including a Nov. 4 press release touting the
drug's safety. Members of Congress have asked Pfizer for
documents regarding Celebrex(R) and Bextra(R), the Company's
other Cox-2 inhibitor. They want to know what information Pfizer
had about the NCI study when it made the safety statements.
Plaintiff contends that the Company has declared in the first
nine months of the year, worldwide sales of Celebrex(R) more
than doubled from a year earlier to $2.3 billion, accounting for
6 percent of Pfizer's total sales of $37.6 billion during that
period. The withdrawal of Vioxx(R) has been a financial and
public relations disaster for Merck. Its legal liabilities are
estimated at up to $18 billion, and its shares have dropped by
nearly one-third since the recall announcement in late
September. Vioxx(R) had been Merck's No. 2 earner with annual
global sales of $2.5 billion, amounting to 11 percent of the
Company's $22.49 billion in revenue last year. Earlier this
month, according to the complaint, the Food and Drug
Administration said it was adding a warning to the labels of
another Pfizer drug, Bextra(R), noting a risk of potential heart
problems associated with the use of Bextra(R) in the people who
have recently had heart bypass surgery. Bextra(R) is also a cox-
2 inhibitor type of drug. Pfizer shareholders who acquired or
purchased their shares after October 31, 2000 and up to November
16, 2004 are included in this lawsuit.
Earlier today, the Wall Street Journal reported that Pfizer's
new drug called Lyrica, to be used for the treatment of nerve
pain, "was likely to be classified" a controlled substance. A
classification such as this by the Drug Enforcement Agency could
cause advertising, prescribing, stocking and dispensing problems
or difficulties, according to the article. Pfizer had hoped that
sales of Lyrica would replace the smaller sales of Neurontin
which last year became a generic drug. Pfizer and Merck were not
the only pharmaceutical companies to get negative news as it was
reported in the British Medical Journal on Friday that it had
sent documents provided by an anonymous source to the U. S. Food
and Drug Administration that the producer of the anti-depressant
Prozac, Eli Lilly & CO. (NYSE:LLY), knew since the 1980's that
the drug had "troubling side effects." Scott + Scott has not
filed suit against Lilly at this time.
For more details, contact Neil Rothstein or David R. Scott by
Phone: 800-404-7770 (EDT) or 800-332-2259 (PDT) or 619-233-4565
(California) or Connecticut 860-537-3818 (Connecticut) or by E-
mail: nrothstein@scott-scott.com or drscott@scott-scott.com.
PFIZER INC.: Emerson Poynter Launches Securities Suit in S.D. NY
----------------------------------------------------------------
Emerson Poynter LLP initiated a securities class action filed in
the United States District Court for the Southern District of
New York on behalf of purchasers of Pfizer Inc (NYSE: PFE)
(NYSE:PFE) publicly traded securities during the period between
October 31, 2000 and December 16, 2004.
The complaint charges Pfizer and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Pfizer is a research-based, global pharmaceutical Company
that discovers, develops, manufactures and markets prescription
medicines for humans and animals, as well as consumer healthcare
products.
The complaint alleges that during the Class Period, defendants
issued false and misleading statements and omissions regarding
the safety and marketability of Pfizer's Celebrex and Bextra
COX-2 inhibitor products. Throughout the Class Period,
defendants were made aware of strong indicators that Pfizer's
COX-2 inhibitor drugs posed serious undisclosed health risks to
patients who were prescribed the drugs. As a result of the
defendants' false statements, Pfizer's stock traded at inflated
levels during the Class Period.
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 although the information does not appear in the
U.S. package insert and prescribing information,
Celebrex increases the potential for causing adverse
cardiovascular events, since it is a selective COX-2
inhibitor capable of creating a metabolic imbalance
between prothrombic cyclo-oxygenase-1 (COX-1) and
antithrombotic cyclo-oxygenase-2 (COX-2) metabolism;
(2) that prior clinical studies, including the CLASS study
where concurrent low-dose aspirin therapy, ibuprofen or
diclofenac controls were employed, were flawed and
defective, since non-steroidal anti-inflammatory drug
("NSAID") use also impacts the metabolic balance
between COX-1 and COX-2 metabolism, potentially
lowering the observed number of cardiovascular events
in those studies;
(3) that even as defendants promoted Celebrex to
physicians, patients and investors on the basis of its
safety and efficacy, health authorities continued to
receive alarming reports of observed cardiovascular and
cerebrovascular adverse reactions in patients not
predisposed to cardiovascular disease;
(4) that even as defendants heralded the safety of Celebrex
following the recall of Vioxx, another anti-arthritic
drug marketed by Merck, defendants knew that, unlike
the scientifically valid clinical studies triggering
the Vioxx recall, previous clinical trials pointing to
the cardiovascular safety of Celebrex, including the
CLASS study, were so flawed and defective that
additional clinical studies looking at cardiovascular
safety were required; and
(5) that even as defendants intensified their retail
advertising campaign and public statements following
the Vioxx recall, including publishing full-page
advertisements in major newspapers heralding the safe
use of the drug, overwhelming and indisputable data and
results pointed to a class-specific cardiovascular
health risk for COX-2 inhibitors, including the adverse
cardiovascular safety data defendants had already
generated for Bextra, the Company's other selective
COX-2 inhibitor drug, and nearly completed specific
safety studies of Celebrex that would demonstrate that
Celebrex suffered from the class-specific
cardiovascular risks attributable to COX-2 inhibitors.
On December 17, 2004, Pfizer announced it had "received new
information . about the cardiovascular safety of its COX-2
inhibitor Celebrex (celecoxib) based on an analysis of two long-
term cancer trials." On this news, Pfizer shares fell to as low
as $22 per share.
For more details, contact the shareholder relations department
of Emerson Poynter LLP by Phone: 1-800-663-9817 or by E-mail:
epllp@emersonpoynter.com.
SOURCECORP INC.: Schiffrin & Barroway File Securities Suit in TX
----------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action on behalf of all securities purchasers of the SOURCECORP
Incorporated (NASDAQ: SRCPE) from May 7, 2003 through October
26, 2004 inclusive in the United States District Court for the
Northern District of Texas.
The complaint charges SOURCECORP, Ed H. Bowman, Jr. and Barry L.
Edwards 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 had materially overstated its net
income and earnings per share;
(2) that defendants prematurely recognized revenue in its
Information Management and Distribution Division;
(3) that the Company's financial statements were not
prepared in accordance with Generally Accepted
Accounting Principles ("GAAP");
(4) that the Company lacked adequate internal controls and
was therefore unable to ascertain the true financial
condition of the Company; and
(5) that as a result, the value of the Company's net income
and financial results were materially overstated at all
relevant times.
On October 27, 2004, SOURCECORP announced that based on
information provided by, and the recommendation of, corporate
management, the Company's Audit Committee concluded on October
25, 2004 that the Company's previously issued financial
statements and related independent auditors' report for the year
ended December 31, 2003, as well as its previously issued
financial statements for the 2004 quarterly periods ended March
31, 2004 and June 30, 2004, should no longer be relied upon. The
Company, under the guidance of the Audit Committee, had
initiated an investigation of the financial results of one of
the Company's operating subsidiaries in the Information
Management Division of the Company's Information Management and
Distribution reportable segment. Following this announcement,
shares of SOURCECORP fell $6.59 per share, or 29.67 percent.
For more details, contact Marc A. Topaz, Esq. or Darren J.
Check, Esq., by Phone: 1-888-299-7706 or 1-610-667-7706, or by
E-mail at info@sbclasslaw.com.
SOURCECORP INC.: Lerach Coughlin Updates TX Securities Lawsuit
--------------------------------------------------------------
Lerach Coughlin Stoia Geller Rudman & Robbins LLP updated the
class action commenced in the United States District Court for
the Northern District of Texas on behalf of purchasers of
SOURCECORP, Incorporated (NASDAQ:SRCPE) common stock during the
period between May 7, 2003 and October 27, 2004.
The complaint charges SOURCECORP and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. SOURCECORP provides value-added business process
outsourcing solutions to clients across the United States. The
Company targets information intensive industry segments such as
healthcare, legal, financial services and government.
The complaint alleges that, throughout the Class Period
defendants issued numerous positive statements and filed
quarterly reports with the SEC which described the Company's
increasing financial performance. These statements were
materially false and misleading because they failed to disclose
and misrepresented the following adverse facts, among others:
(1) that the Company had improperly and prematurely
recognized revenue prior to the delivering
contractually required output to a certain customer;
(2) that the Company improperly and prematurely recognized
revenue for services that were performed and delivered
to customers that were in excess of the volume and/or
revenue limits set by the contract with the customer
and of which there is no assurance that the customer
will ever make payment;
(3) that the Company lacked adequate internal controls and
was therefore unable to ascertain its true financial
condition; and
(4) that as a result of the foregoing, the values of the
Company's revenues and earnings for 2003 and the first
two quarters of 2004 were materially overstated at all
relevant times and will now have to be restated.
On October 27, 2004, the Company shocked the market when it
issued a press release announcing that based on information
provided by, and the recommendation of, corporate management,
the Company's Audit Committee concluded on October 25, 2004 that
the Company's previously-issued financial statements and related
independent auditors' report for the year ended December 31,
2003, as well as its previously-issued financial statements for
the 2004 quarterly periods ended March 31, 2004 and June 30,
2004, should no longer be relied upon.
Specifically, the Company admitted that the Information
Management Division of its Information Management and
Distribution reportable segment had improperly and prematurely
recognized revenue prior to the delivery of contractually
required output to a certain customer; and for services which
were performed and delivered to certain customers in excess of
the volume and/or revenue limits set by the contract. Due to
its improper revenue recognition practices, the Company will
have to adjust its revenues and diluted earnings per share for
2003 by at least $5.4 million and $0.19 respectively. For the
six months ended June 30, 2004, the Company may have to adjust
its revenues and diluted earnings per share by at least $2.8
million and $0.10 respectively.
Upon this shocking news, shares of the Company's stock fell
$5.96 per share, or almost 30%, to close at $16.25 per share, on
unusually heavy trading volume.
Following that announcement, on November 16, 2004, the Company
received a Nasdaq Staff Determination letter indicating that the
Company had failed to timely file its quarterly report on Form
10-Q for the quarter ended September 30, 2004, as required by
Nasdaq Marketplace Rule 4310(c)(14), and that the Company's
common stock is therefore subject to delisting from The Nasdaq
Stock Market. The Company now trades under the ticker symbol
SRCPE.
For more details, contact Samuel H. Rudman or David A. Rosenfeld
of Lerach Coughlin by Phone: 800/449-4900 or 619/231-1058 by E-
mail: wsl@lerachlaw.com or visit the firm's Website:
http://www.lerachlaw.com.
SUPPORTSOFT INC.: Marc S. Henzel Lodges Securities Suit in CA
-------------------------------------------------------------
The law offices of Marc S. Henzel initiated class action lawsuit
in the United States District Court for the Northern District of
California on behalf of all securities purchasers of
SupportSoft, Inc. (Nasdaq: SPRT) between January 20, 2004 and
October 1, 2004, inclusive (the "Class Period").
The complaint charges SupportSoft, Radha R. Basu, and Brian M.
Beattie with violations of the Securities Exchange Act of 1934.
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 failed to close two $4.5 million
transactions, due to major flaws in SupportSoft's
internal controls;
(2) that the Company was experiencing sales execution
issues;
(3) that SupportSoft's product pipeline was heavily
weighted toward perpetual deals;
(4) that due to the saturation of the domestic broadband
market, the Company was facing a more challenging
software spending environment of authorization
signatures and longer sales cycles; and
(5) that as a result of the above, the defendants' fiscal
2004 projections were lacking in any reasonable basis
when made.
On October 4, 2004, SupportSoft announced preliminary financial
results for the quarter ended September 30, 2004. The Company
expected total revenues for the third quarter 2004 to be in the
range of $11.9 million to $12.3 million versus $13.5 million for
the same period last year. GAAP loss per share was expected to
be in the range of $0.01 to $0.04, this was well below
expectations. News of this shocked the market. Shares of
SupportSoft fell $3.41 per share, or 35.45 percent, to close at
$6.21 per share.
For more details, contact the Law Offices of Marc S. Henzel by
Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by
Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by
E-Mail: mhenzel182@aol.com.
SUPPORTSOFT INC.: Shepherd Finkelman Files Securities Suit in CA
----------------------------------------------------------------
The law firm of Shepherd, Finkelman, Miller & Shah, LLC
initiated a lawsuit seeking class action status in the United
States District Court for the Northern District of California on
behalf of all persons (the "Class") who purchased the securities
of SupportSoft, Inc. ("SupportSoft" or the "Company") (NasdaqNM:
SPRT - News) between January 20, 2004 and October 1, 2004 (the
"Class Period"). The Complaint names the following Defendants:
SupportSoft, Radha R. Basu and Brian M. Beattie.
The Complaint alleges that, during the Class Period, Defendants
violated Sections 10(b) and 20(a) of the Securities Act of 1934
and Rule 10b-5 promulgated thereunder. Specifically, the
Complaint alleges that, during the Class Period, Defendants
issued a series of false and misleading statements to the market
regarding its financial performance.
The Complaint alleges that Defendants' 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, which ended on September 30, 2004.
The Company announced that it now expected total revenues for
the third quarter of 2004 to be between $11.9 million and $12.3
million -- as compared to $13.5 million for the same period in
2003. The Company claimed that an alleged "tightness in IT
spending" and "more complex approval processes"' were the
reasons for this significant miss in earnings. On this news, the
Company's share price dropped precipitously from $9.62 per share
to $6.21 per share -- a drop of 35.4% on extremely heavy trading
volume.
For more details, contact James E. Miller, Esq. or James C.
Shah, Esq. by Phone: 866/540-5505 or 877/891-9880 or by E-mail:
jmiller@classactioncounsel.com or jshah@classactioncounsel.com.
TASER INTERNATIONAL: Berman DeValerio Lodges Stock Suit in AZ
-------------------------------------------------------------
The law firm of Berman DeValerio Pease Tabacco Burt & Pucillo on
behalf of an investor has initiated a class action lawsuit
against Taser International, Inc. ("Taser" or the "Company")
(Nasdaq:TASR) in the U.S. District Court for the District of
Arizona, claiming that the manufacturer of less-lethal weapons
misled investors about the demand for and the safety of its
products. The lawsuit seeks damages for violations of federal
securities laws on behalf of all investors who bought Taser
common stock during the period of October 18, 2004 through and
including January 6, 2005 (the "Class Period").
The lawsuit claims that the defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder, including U.S.
Securities and Exchange Commission ("SEC") Rule 10b-5.
The complaint names as defendants: Taser; Dr. Phillips W. Smith,
who at all relevant times served as Taser's Chairman; Patrick
(Rick) W. Smith, who was at all relevant times the Company's
Chief Executive Officer and Director; Thomas P. Smith, who at
all relevant times served as President and Director; and Daniel
Behrendt, who was at all relevant times the Company's Chief
Financial Officer.
According to the complaint, Defendants claimed increasing demand
for Taser products and touted their safety throughout the Class
Period. The Company repeatedly stated that its products were not
the primary cause of death of people captured by the use of its
products. Taser referred to a Department of Defense ("DoD")
study conducted by the Human Effects Center of Excellence, which
it claimed concluded that its products were generally effective
without significant risk of unintended results.
In reality, however, Taser knew at the time they made these
statements that studies conducted on the Company's products
raised reservations as to the products' safety, the lawsuit
says. Taser allegedly knew that the DoD study was inconclusive
and that further research needed to be done to determine the
safety of the Company's products. Taser also knew that sales of
its products were slowing as a result of the questions
concerning its products' safety.
On January 6, 2005, after the markets closed, Taser stunned the
public when it announced that it had received an informal
inquiry letter from the SEC regarding the Company's statements
about the safety of its products and a $1.5 million order of
Taser devices received from one of the Company's distributors,
which was booked in late December 2004.
As a result of the announcement, shares of the Company's common
stock fell $4.90, or 18%, to close at $22.72 per share.
Then, on January 11, 2005, Taser further shocked investors when
it announced that orders for the first half of 2005 might be
delayed while law enforcement agencies test competitors'
products. On this news, shares of the Company's common stock
fell an additional $5.95, or 30%, to close at $14.10 per share.
For more details, contact Colleen M. Conners, Esq. or Leslie R.
Stern, Esq. by Mail: One Liberty Square, Boston, MA 02109 by
Phone: (800) 516-9926 or by E-Mail: law@bermanesq.com.
TASER INTERNATIONAL: Girard Gibbs Lodges Securities Suit in AZ
--------------------------------------------------------------
The law firm of Girard Gibbs & De Bartolomeo LLP initiated a
class action lawsuit on behalf of investors in TASER
International, Inc. (NASDAQ:TASR) ("TASER" or "the Company"),
who purchased or otherwise acquired the common stock of TASER,
between November 4, 2004 and January 6, 2005, inclusive (the
"Class Period"). The lawsuit asserts claims under the Securities
Exchange Act of 1934 (the "Exchange Act").
The class action, captioned Guzman v. TASER International, Inc.,
et al, CV05-0142 PHXMHM, is pending in the United States
District Court for the District of Arizona. The class action is
brought against defendants TASER International, Inc., Patrick W.
Smith, Thomas P. Smith, Phillips W. Smith, Kathleen C. Hanrahan
and Daniel M. Behrendt ("Defendants").
According to the complaint, Defendants falsely touted the safety
of TASER stun guns and engaged in sales of stun guns merely to
meet end-of-year projections. Specifically, throughout the Class
Period, Defendants issued numerous positive statements
concerning the demand for the Company's TASER devices and the
safety of the Company's products. These statements, however,
were materially false and misleading because they failed to
disclose:
(1) that, contrary to Defendants' representations, the
studies conducted on the Company's TASER devices were
inconclusive as to their safety;
(2) that TASER's revenues and earnings would be negatively
impacted once the truth of these studies was disclosed;
(3) that an end-of-the-quarter order of TASER devices which
the Company had received from one of its distributors
was done solely to help TASER meet its projected
revenue growth and did not accurately reflect the
demand for the Company's devices; and
(4) as a result of the foregoing, Defendants lacked a
reasonable basis for their positive statements
regarding the safety of, and demand for, TASER devices.
After the market closed on January 6, 2005, Defendants issued a
press release disclosing that TASER had received an informal
inquiry letter from the Securities and Exchange Commission
regarding the Company's statements about the safety of its
products and a recent order received from one of its
distributors. The market reacted to TASER's announcement by
punishing the Company's share price, and on January 7, 2005,
shares of TASER common stock closed at $22.72 per share, off
$4.90 per share, or 18 percent, from the previous day's closing
price.
For more details, contact Aaron M. Sheanin by Mail: 601
California Street, Suite 1400, San Francisco, CA 94108 by
Phone: (866) 981-4800 or by E-mail: mail@girardgibbs.com or Web
site: http://www.girardgibbs.com/TASER.html.
*********
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.
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news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
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Class Action Reporter is a daily newsletter, co-published by
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Copyright 2005. All rights reserved. ISSN 1525-2272.
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