/raid1/www/Hosts/bankrupt/CAR_Public/050207.mbx
C L A S S A C T I O N R E P O R T E R
Monday, February 7, 2005, Vol. 7, No. 26
Headlines
AMERICAN HONDA: Recalls 34,919 Motorcycles Due To Crash Hazard
APPLE COMPUTER: CA Court To Hear Dismissal Appeal in Feb. 2005
APPLE COMPUTER: CA Court Considers Show Cause Order in Lawsuit
APPLE COMPUTER: Parties Enter Settlement Discussions in CA Suit
APPLE COMPUTER: Consumers Launch Antitrust Suit Over Ipods in CA
APPLE COMPUTER: Asks IL Court To Dismiss Consumer Fraud Lawsuit
ARGENTINA: GCAB Slams Government Attempt To Coerce Bondholders
CALIFORNIA: Appeals Court Rules Proposition 64 Not Retroactive
INDIANA: ACLU Files Suit Over Prison Conditions At Wabash Valley
JUDY'S CANDY: Recalls Caramel/Jar 50ps Due To Undeclared Almonds
MASSMUTUAL: NJ Ruling Qualifies Millions For $700 Mil Settlement
MICHIGAN: Bank, Credit Issues Top MI Consumer Complaints Lists
NBTY INC.: To Ask NY Court To Dismiss Securities Fraud Lawsuits
NETOPIA INC.: CA Court Consolidates Securities Fraud Lawsuits
NEW YORK: Steuben County Joins Suit Over Medicaid Reimbursement
NORTH CAROLINA: A.G. Cooper Cracks Down on 2 Telemarketing Firms
PENNSYLVANIA: Court Refuses To Allow Students To Join $1.4M Suit
ROYAL SEAFOOD: Recalls Mushrooms Due To Undeclared Sulfites
SOBONITO INVESTMENTS: Inks Settlement With FTC Over Illegal Spam
TIDEL TECHNOLOGIES: TX Court Approves Securities Suit Settlement
UNITED STATES: Alliance For Justice Opposes Approval of S.5
UNITED STATES: Big "I" Elated Over Progress Of Litigation Reform
UNITED STATES: Lawyers' Committee Calls For Amendments To S.5
UNITED STATES: President's State Of The Union Address Applauded
UNITED STATES: Senate Panel OK's Measure To Curb Frivolous Suits
New Securities Fraud Cases
ASTRAZENECA PLC: Smith & Smith Files Securities Fraud Suit in MA
DIRECT GENERAL: Lasky & Rifkind Lodges Securities Suit in TN
DIRECT GENERAL: Marc S. Henzel Files Securities Fraud Suit in TN
EPIX PHARMACEUTICALS: Smith & Smith Lodges Securities Suit in MA
GANDER MOUNTAIN: Marc S. Henzel Lodges MN Securities Fraud Suit
GANDER MOUNTAIN: Schiffrin & Barroway Lodges MN Securities Suit
PHARMOS CORPORATION: Schor Greenwald Files Securities Suit in NJ
SIERRA WIRELESS: Charles J. Piven Lodges Securities Suit in NY
SIERRA WIRELESS: Marc S. Henzel Lodges Securities Suit in NY
SIERRA WIRELESS: Schiffrin & Barroway Lodges Stock Suit in NY
SIERRA WIRELESS: Smith & Smith Files Securities Fraud Suit in NY
SIPEX CORPORATION: Smith & Smith Lodges Securities Suit in CA
SYSTEMATIC INVESTMENT: Blumenthal & Markham Lodges CA Stock Suit
TASER INTERNATIONAL: Glancy Binkow Lodges Securities Suit in AZ
*********
AMERICAN HONDA: Recalls 34,919 Motorcycles Due To Crash Hazard
--------------------------------------------------------------
American Honda Motor Co. is cooperating with the National
Highway Traffic Safety Administration (NHTSA) by voluntarily
recalling 34,919 motorcycles, namely:
(1) HONDA / GL1800, models 2001-2004
(2) HONDA / GL1800A, models 2001-2004
On some motorcycles, certain frame welds do not meet
manufacturing specifications. High loads created when riding on
rough road surfaces or through potholes can cause the affected
welds to crack. The welded area could break, resulting in rear
suspension collapse or lower cross member separation, increasing
the risk of a crash.
Dealers will inspect and, if necessary, reinforce the welds on
2001-2002 motorcycles. On 2003-2004 motorcycles, the units will
be repaired, no inspection will be necessary. The recall is
expected to begin on February 15, 2005. For more details,
contact the Company by Phone: 1-866-784-1870 or the NHTSA's auto
safety hotline: 1-888-327-4236.
APPLE COMPUTER: CA Court To Hear Dismissal Appeal in Feb. 2005
--------------------------------------------------------------
The United States District Court for the Northern District of
California will hear on February 17,2005 plaintiffs' appeal of
the dismissal of three securities class actions filed against
Apple Computer, Inc. and chief executive Steven P. Jobs. The
suits are styled:
(1) Hawaii Structural Iron Workers and Pension Trust Fund
v. Apple Computer, Inc. and Steven P. Jobs;
(2) Young v. Apple Computer, Inc., et al.;
(3) Hsu v. Apple Computer, Inc., et al.
These lawsuits are substantially identical, and purport to bring
suit on behalf of persons who purchased the Company's publicly
traded common stock between July 19, 2000, and September 28,
2000. The complaints allege violations of the 1934 Securities
Exchange Act and seek unspecified compensatory damages and other
relief.
The Company filed a motion to dismiss on June 4, 2002, which was
heard by the Court on September 13, 2002. On December 11, 2002,
the Court granted the Company's motion to dismiss for failure to
state a cause of action, with leave to Plaintiffs to amend their
complaint within thirty days. Plaintiffs filed their amended
complaint on January 31, 2003, and on March 17, 2003, the
Company filed a motion to dismiss the amended complaint. The
Court heard the Company's motion on July 11, 2003 and dismissed
Plaintiffs' claims with prejudice on August 12, 2003.
Plaintiffs appealed the ruling. The parties have fully briefed
the appeal.
The lead case in this litigation is styled "Hawaii Structural
Iron Workers Pension Trust Fund v. Apple Computer Inc., et al.,
case no. 4:01-cv-03667, filed in the U.S. District Court
California Northern District (Oakland), under Judge Hon. Claudia
Wilken.
Lawyers for the plaintiffs are:
(1) William S. Lerach, Thomas Edward Egler, Lerach Coughlin
Stoia & Robbins LLP, 401 B Street, Suite 1700, San
Diego, CA 92101, Phone: 619/231-1058, Fax: 619-231-
7423, E-mail: billl@lerachlaw.com or tome@lerachlaw.com
(2) Dennis J. Herman, Eli Greenstein, Patrick J. Coughlin,
Randi D. Bandman, Sylvia Wahba Keller, Lerach Coughlin
Stoia & Robbins LLP, 100 Pine Street, Suite 2600, San
Francisco, CA 94111, Phone: 415/288-4545, Fax: 415-288-
4534, E-mail: dennish@mwbhl.com, Elig@mwbhl.com,
patc@mwbhl.com, randib@mwbhl.com
(3) Edwina A. Ebisui, Jr., Law Office of Edwina A. Ebisui,
Jr., 410 Kilani Street, Suite 211, Wahiawa, HI 96786,
Phone: 808-622-3933, Fax: 808-621-6208
(4) Roger B. Greenberg, Schwartz Junell Campbell Oathout,
909 Fannin Ste 2000, Houston, TX 77057, Phone: (713)
752-0017, Email: rgreenberg@schwartz-junell.com
(5) Marc S. Henzel, Law Offices of Marc S. Henzel, 273
Montgomery Ave., Suite 202 Bala Cynwyd, PA 19004,
Phone: 610-660-8000/888-643-6735, Fax: 610-660-8080, E-
mail: mhenzel182@aol.com
(6) Marc A. Topaz, Schiffrin & Barroway, Three Bala Plaza
East, Suite 400, Bala Cynwyd, PA 19004, Phone: 610/667-
7706, Fax: 610-667-7056
(7) Paul J. Geller, Cauley Geller Bowman & Coates LLP, One
Boca Place, Suite 421A, 2255 Glades Road, Boca Raton,
FL 33431, Phone: 561-750-3000, Fax: 561-750-3364
Lawyers for the defendants are David R. Eberhart and George A.
Riley of O'Melveny & Myers LLP, 275 Battery Street, Suite 2600,
San Francisco, CA 94111-3305, Phone: 415-984-8808, Fax:
415-984-8701, Email: deberhart@omm.com or griley@omm.com.
APPLE COMPUTER: CA Court Considers Show Cause Order in Lawsuit
--------------------------------------------------------------
The Los Angeles County Superior Court heard arguments for the
show cause order in a class action filed against Apple Computer,
Inc., styled "Cagney v. Apple Computer, Inc."
Plaintiff filed this purported class action on January 9, 2004,
alleging improper collection of sales tax in transactions
involving mail-in rebates. The complaint alleges violations of
California Business and Professions Code Section 17200 (unfair
competition) and seeks unspecified damages and other relief.
The Company was served on January 21, 2004, and filed an answer
on February 20, 2004, denying all allegations and asserting
numerous affirmative defenses. The Company is investigating
these allegations. The Company filed a motion to disqualify
Plaintiff's counsel, which the Court denied. The Company filed
a petition for a writ of mandate with respect to this ruling and
the Court of Appeal has issued an order to show cause as to why
the writ should not issue. Plaintiff's lead counsel
subsequently withdrew. The hearing on the show cause order took
place on January 26, 2005 and the Court has not yet issued its
ruling. The Company has obtained an opinion on the tax issue
from the State Board of Equalization.
APPLE COMPUTER: Parties Enter Settlement Discussions in CA Suit
---------------------------------------------------------------
Discovery is stayed pending settlement discussions for the
consolidated consumer class action filed against Apple Computer,
Inc. in California Superior Court for the County of San Mateo,
over alleged misrepresentations by the Company over the battery
life of its popular iPod mp3 player.
Eight suits were initially filed, entitled:
(1) Craft v. Apple Computer, Inc., (filed December 23,
2003, Santa Clara County Superior Court);
(2) Chin v. Apple Computer, Inc., (filed December 23, 2003,
San Mateo County Superior Court);
(3) Hughes v. Apple Computer, Inc., (filed December 23,
2003, Santa Clara County Superior Court);
(4) Westley v. Apple Computer, Inc., (filed December 26,
2003, San Francisco County Superior Court);
(5) Keegan v. Apple Computer, Inc., (filed December 30,
2003, Alameda County Superior Court);
(6) Wagya v. Apple Computer, Inc., (filed February 19,
2004, Alameda County Superior Court);
(7) Yamin v. Apple Computer, Inc., (filed February 24,
2004, Los Angeles County Superior Court);
(8) Kieta v. Apple Computer, Inc., (filed July 8, 2004,
Alameda County Superior Court)
The suits include causes of action for violation of California
Civil Code Section 17200 (unfair competition), the Consumer
Legal Remedies Action ("CLRA") and claims for false advertising,
fraudulent concealment and breach of warranty. The complaints
seek unspecified damages and other relief, an earlier Class
Action Reporter story (December 28,2004) reports. The Company
is investigating these claims. The cases have been consolidated
in San Mateo County.
On July 26, 2004, Plaintiffs filed a consolidated complaint. On
August 25, 2004, the Company filed an answer denying all
allegations and asserting numerous affirmative defenses.
Discovery is stayed pending settlement discussions among the
parties.
In addition, a similar complaint relative to iPod battery life,
Mosley v. Apple Computer, Inc.," was filed in Westchester
County, New York on June 23, 2004 alleging violations of New
York General Business Law Sections 349 (unfair competition) and
350 (false advertising). The Company removed the case to
Federal Court and Plaintiff filed a motion for remand, which the
Court has not yet decided.
The consolidated suit is styled "Lisa Chin v. Apple Computer,
Inc., case no. CIV-43-6509. Plaintiffs are Lisa Chin, Andrew E.
Westley, Sylvia Kieta, Steve Yamin, Joseph Smiley and Sam Wagya.
Lawyers for the plaintiffs are Steven N. Williams, Reginald
Terrell, Shannon P. Cereghino, Andrew N. Friedman, Emelike I.
Kalu. Lawyer for the Company is Andrew D. Muhlbach.
APPLE COMPUTER: Consumers Launch Antitrust Suit Over Ipods in CA
----------------------------------------------------------------
Apple Computer, Inc. faces a class action filed in the United
States District Court for the Northern District of California,
styled "Slattery v. Apple Computer, Inc.," alleging various
claims including alleged unlawful tying of music purchased on
the iTunes Music Store with the purchase of iPods and vice versa
and unlawful acquisition or maintenance of monopoly market
power.
Plaintiff's complaint alleges violations of Sections 1 and 2 of
the Sherman Act (15 U.S.C. Sections 1 and 2), California
Business and Professions Code Section 16700 et seq. (the
Cartwright Act), California Business and Professions Code
Section 17200 (unfair competition), common law unjust enrichment
and common law monopolization. Plaintiff seeks unspecified
damages and other relief.
The Company is investigating this claim in connection with
preparing its response to the complaint. The Company's response
is due on February 10, 2005.
The suit is styled "Slattery v. Apple Computer, Inc., case no.
5:05-cv-00037-JW," filed in the United States District Court for
the Northern District of California, under Judge James Ware.
Lawyer for the Company is Adam Richard Sand, Esq. of Jones Day,
555 California Street, 26th Floor, San Francisco, CA 94104,
Phone: 415-875-5716, E-mail: arsand@JonesDay.com. Lawyers for
the class are:
(1) Eric J. Belfi, Murray, Frank & Sailer LLP, 275 Madison
Avenue, Suite 801, New York, NY 10016, Phone: 212-682-
1818, Fax: 212-682-1892, E-mail: ebelfi@murrayfrank.com
(2) Michael David Braun and Marc L. Godino, BRAUN LAW
GROUP, P.C., 12400 Wilshire Boulevard, Suite 920, Los
Angeles, CA 90025, Phone: 310-442-7755, Fax: (310) 442-
7756, E-mail: mdb@braunlawgroup.com or
service@braunlawgroup.com
(3) Roy A. Katriel, The Katriel Law Firm, P.L.L.C., 1101
30th Street, NW Suite 500, Washington, D.C. 20007,
Phone: 202-625-4342, Fax: 202-625-6774
(4) Jacqueline Sailer, Rabin & Peckel LLP, 275 Madison
Avenue, New York, NY 10016, Phone: 212-682-1818, Fax:
212-682-1892
APPLE COMPUTER: Asks IL Court To Dismiss Consumer Fraud Lawsuit
---------------------------------------------------------------
Apple Computer, Inc. asked the United States District Court in
Illinois to dismiss a class action filed against it, styled
"Stamm v. Apple Computer, Inc."
Plaintiff initially filed this purported class action in the
Circuit Court for Cook County on November 12, 2004, alleging
that a defect in Apple's 17" Studio Display monitors results in
dimming of half of the screen and constant blinking of the power
light.
The Company is investigating the claim. The Company removed the
case to federal court on December 22, 2004. Plaintiff filed a
motion to remand the case to state court on January 21, 2005.
The Company filed a motion to dismiss on January 27, 2005.
The suit is styled "Stamm v. Apple Computer, Inc., case no.
2004-CH-18767. Lawyer for plaintiff David Stamm is Kenneth A.
Wexler, 1 N. Lasalle St., Chicago IL 60602, Phone:
(312) 346-2222. Law firm for the Company is KIRKLAND & ELLIS
LLP, 200 E. Randolph Dr., Chicago IL, 60601, Phone:
(312) 861-2000
ARGENTINA: GCAB Slams Government Attempt To Coerce Bondholders
--------------------------------------------------------------
The Argentine Economy Minister Roberto Lavagna publicly revealed
that the executive branch would send to the Argentine Congress a
law that would prohibit any future offer to bondholders who do
not accept the current exchange offer commenced by Argentina on
January 12, 2005. In addition, the law would require the
government to take all necessary steps to de-list defaulted
bonds not tendered in the exchange offer.
This proposal, according to the Global Committee of Argentina
Bondholders (GCAB) is another deliberate attempt by Argentina to
threaten bondholders into accepting a unilateral and coercive
exchange offer that many holders are now realizing is well below
Argentina's ability to pay and does not represent fair value for
the defaulted debt held by hundreds of thousands of holders. It
ignores the various international legal systems under which the
defaulted debt was issued. Passing a law in Argentina does not
subordinate a creditor's rights that are contained in the bond
agreements.
Holders of the defaulted debt should recognize that this action
by Argentina is a last ditch attempt to rescue a failing
transaction following public rejection of the offer from major
bondholder groups. Congressional action in Argentina will not
supersede rights under international law. Moreover, Argentina
has historically adopted and repealed laws to suit short-term
political goals and this action should not be considered a
permanent change.
If there was any question that Argentina has not acted in good
faith, this development should clarify matters. Given this lack
of good faith, which is contrary to its written commitment to
the International Monetary Fund and the G-7 to do so, the IMF
cannot re-engage Argentina and, in any way, provide added
financial assistance as it will be acting in direct
contradiction of its own policy regarding "lending in arrears."
The Official Sector needs to finally express, in the strongest
possible terms, its condemnation of this maneuver, which will
establish a dangerous precedent for sovereign bond issuances.
GCAB again calls on the G-7 and the IMF to reject this plan and
denounce Argentina's unilateral and coercive exchange offer as
Italy has already done so rather than stand by in tacit
approval.
Formed in January 2004, GCAB is composed of key Argentina
bondholder groups and committees from around the world, its
Steering Committee has been empowered to facilitate a good
faith, market-based consensual and equitable restructuring of
Argentina's defaulted debt. The global committee represents
holders of over US$39 billion in debt that encompasses more than
500,000 retail investors and more than 100 institutions, banks,
partnerships and committees.
As previously reported in the June 30, 2004 edition of the Class
Action Reporter, bondholders initiated a proposed class-action
suit against the Argentine government, bringing the fight over
the country's default of $88 billion in bonds to the U.S.
courts. Once approved by the court, the proposed class would
cover more than five hundred thousand investors primarily from
Italy, Germany, France and the United States who purchased the
government-issued bonds.
This move will almost certainly raise the stakes in the standoff
between Buenos Aires and the bondholders. If successful, the
case would allow bondholders to seize Argentine government
assets in the United States and use those assets to repay
bondholders.
Filed in U.S. District Court in New York, the complaint states
that the moratorium on foreign debt declared by Argentina on
December 23, 2001 and its subsequent lack of payment on bonds
constitutes a default of the bond agreement made between the
government and its bondholders. This is the first major suit
seeking a global settlement for all purchasers of Argentine
bonds. The complaint seeks compensation for damages sustained by
bondholders and payment of the cost of suit fees incurred by
bondholders.
For more details, contact GCAB c/o Hans Humes Greylock Capital
Associates, LLC by Phone: +1-212-808-1818 OR Nicola Stock
Associazione per la Tutela Degli Investitori in Titoli Argentini
by Phone: +3906-676-7603 or visit the GCAB Web site:
http://www.gcab.org.
CALIFORNIA: Appeals Court Rules Proposition 64 Not Retroactive
--------------------------------------------------------------
The First District Court of Appeals has ruled that Proposition
64's limitations on private enforcement of unfair competition
laws do not apply to lawsuits filed before its effective date of
November 3 of this year, the Metropolitan News-Enterprise
reports.
In a published opinion, Division Four denied a motion by the
owner of the Mervyn's department store chain to dismiss an
appeal from Alameda Superior Court Judge Henry Needham Jr.'s
ruling in favor of the Company.
Citing the Unruh Civil Rights Act and the Disabled Persons Act
as authority, the Californians for Disability Rights had sued
Mervyn's, LLC, alleging that the Company, which operates 125
stores across California discriminates against those with
mobility disabilities by failing to provide adequate pathway
space between merchandise displays. Judge Needham then held a
bench trial in August 2003 and granted final judgment several
months later. While the appeal was pending, voters approved
Proposition 64, an initiative barring unfair competition actions
by private persons unless the plaintiff has suffered economic
injury and can qualify as a class representative.
Justice Patricia Sepulveda, writing for the Court of Appeal,
said the presumption against retroactive application of new laws
applies to Proposition 64. The justice wrote, "Proposition 64
contains no express declaration of retrospectivity, as Mervyn's
rightly concedes. Proposition 64 is wholly silent on the
matter. The terms of the statutory amendments, the legislative
analysis, and the ballot arguments make no mention as to whether
Proposition 64 is meant to apply retroactively to preexisting
lawsuits. The language used in the proposition and ballot
materials also fails to provide any implicit indication that the
electorate intended the law to be retroactive."
Justice Sepulveda cited Evangelatos v. Superior Court (1988) 44
Cal.3d 1188, in which the court held that Proposition 51, the
1986 initiative that ended joint-and-several liability for non-
economic damages could not be applied to actions that accrued
before the measure's effective date.
The justice rejected Mervyn's argument that retroactive
application of Proposition 64 would further the measure's goal
of deterring abuse of the unfair competition laws, an argument
that was similar to the one rejected in the Evangelatos case,
the jurist noted, adding that if the measure's sponsors wanted
the measure to apply retroactively, they could have said so in
the text.
Justice Sepulveda agreed that new legislation might usually be
applied retroactively without violating the state Constitution.
But, the justice explained that this does not mean that intent
to do so can be inferred in the absence of legislative language
to the effect.
The justice also rejected the argument that Proposition 64 was a
change in procedural rules, so that a dismissal would be a
prospective, not a retroactive, application, a contention that
Justice Sepulveda called "ill suited to the situation presented
here," since Mervyn's was seeking to apply Proposition 64 to
deprive the plaintiff of substantive rights.
He went on to address the practical implications of retroactive
application, including future litigation as to whether
plaintiffs who did not plead actual injury or class action
allegations could do so by amendment and whether such amendments
relate back to the filing of the complaint. The justice
explains, "Retroactive application of a statute often entails
difficulties in enforcement and unanticipated consequences, and
should not be embarked upon where, as here, there is no
indication that retroactivity was ever considered or intended by
the voters."
Attorneys on appeal included Andrea G. Asaro of Rosen, Bien &
Asaro and Sidney Wolinsky of Disability Rights Advocates for the
plaintiff and David F. McDowell of Morrison & Foerster for
Mervyn's.
Sharon J. Arkin of Robinson, Calcagnie & Robinson authored an
amicus brief for Consumer Attorneys of California in support of
the plaintiff and Roy G. Weatherup and David N. Makous of Lewis
Bribois Bisgaard & Smith filed an amicus brief for ReadyLink
HealthCare, Inc. on behalf of Mervyn's.
The case is Californians for Disability Rights v. Mervyn's, LLC,
A106199.
INDIANA: ACLU Files Suit Over Prison Conditions At Wabash Valley
----------------------------------------------------------------
The isolation and other conditions found in the Secured Housing
Unit of western Indiana's Wabash Valley Correctional Facility,
one of the state's most restrictive prison units have led four
mentally ill inmates to kill themselves and others to self-
mutilation, the American Civil Liberties Union claimed in a
recently filed federal lawsuit, the Associated Press reports.
According to documents filed in U.S. District Court in Terre
Haute, the ACLU further claims that conditions within the
facility, which houses up to 288 prisoners in solitary,
windowless cells, and one-half to two-thirds of them are
mentally ill, have caused prisoners to hallucinate, rip chunks
of flesh from their bodies, rub human excrement on themselves
and attempt suicide.
Though it did not seek monetary damages, the complaint instead
sought to ban the state from placing mentally ill prisoners in
the unit and class action status to represent all mentally ill
prisoners assigned to the unit at the prison, which is located
about 30 miles south of Terre Haute.
Ken Falk, legal director of the Indiana Civil Liberties Union,
the ACLU's state affiliate, told AP "Locking up prisoners with
mental illness in small, windowless cells is psychological
torture. Confinement for lengthy periods of time in 24-hour
isolation would compromise even a healthy person's sanity."
Conditions at the unit have attracted negative attention in the
past, one of which includes a 1997 report issued by Human Rights
Watch, a U.S.-based human rights monitoring organization, which
condemned the conditions there, saying, "In some cases the
suffering that results is so great that the treatment must be
condemned as torture."
Inmates are incarcerated in cells about 7 feet by 12 feet, each
with a concrete bed and plastic mattress, a metal shelf, a fixed
table and stool, and a combination sink and toilet. Many choose
to remain locked in their cells 24 hours per day because they
have no group recreation. Books, letters, photographs and other
personal items are restricted.
The Department of Correction created the Secured Housing Unit to
shock its most troublesome inmates into conforming, Mr. Falk
said. He told AP, "The problem with that is, if you're mentally
ill and not able to conform your behavior, you will never leave
the SHU."
The lawsuit alleges that since 2000, four mentally ill inmates
in the unit have committed suicide including one who hanged
himself, another set himself on fire, a third cut his wrists and
throat, and the fourth swallowed a cloth and choked to death.
The case is the second in two weeks in which the ICLU has gone
to federal court to force the Indiana prison system to alleviate
what it considers oppressive inmate conditions.
The first lawsuit, which was filed on January 24, alleges that
the department subjected more than 400 inmates at the Pendleton
Correctional Facility northeast of Indianapolis to conditions
unfit for dogs. It said inmates were held two per cell for
nearly five months during a lockdown last year in which they
could leave the 12-by-8-foot spaces for only three shower
periods a week.
JUDY'S CANDY: Recalls Caramel/Jar 50ps Due To Undeclared Almonds
----------------------------------------------------------------
Judy's Candy Company of Berkeley, CA is recalling Assorted
Caramel/Jar 50ps, because it may contain undeclared almonds.
People who have an allergy or severe sensitivity to almonds run
the risk of serious or life-threatening allergic reaction if
they consume these products.
Assorted Caramel/Jar 50ps was distributed to retail stores in
California, Washington, and Idaho.
Assorted Caramel/Jar 50ps is a point-of-sale display consisting
of fifty (50) 1.1 oz. square caramels in a round, clear plastic
tub. The label reads: "Item #0517, Assorted Caramels - 50 Ct.
Jar".
No illnesses have been reported to date.
The recall was initiated after it was discovered that product
containing almonds was distributed in packaging that did not
reveal the presence of almonds. Subsequent investigation
indicates the problem was caused by a printing error.
Consumers who have purchased Assorted Caramel/Jar 50ps are urged
to return it to the place of purchase for a full refund.
Consumers with questions may contact the Company at
1-800-223-1642.
MASSMUTUAL: NJ Ruling Qualifies Millions For $700 Mil Settlement
----------------------------------------------------------------
An estimated 3 million policyholders of insurer MassMutual are
eligible for part of a nationwide class-action settlement valued
at nearly $700 million, which a federal judge recently approved
in Newark, the Newark Star Ledger reports.
U.S. District Judge Jose Linares valued the final settlement at
least $698.7 million with MassMutual obligated to pay as much as
$165 million for certain claims. Court documents revealed that
the remaining value of the settlement involves providing
policyholders additional insurance coverage.
Eight named plaintiffs will receive $10,000 each as an incentive
bonus, while the six plaintiffs' law firms that pursued the
cases on a contingency basis will split $58.2 million, to be
paid on top of the settlement.
Coming more than seven months after MassMutual reached a
preliminary settlement with attorneys pursuing cases in New
Jersey, California and other states, the agreement virtually
consolidated all the lawsuits, some of which had been pending
for nearly a decade.
Commenting on the settlement, Bruce Greenberg of the Newark law
firm Lite DePalma Greenberg & Rivas, one of the firms
representing the class told the Star Ledger, "This is an
excellent settlement for the class and we're very pleased the
court agreed and approved it."
The Springfield, Massachusetts-based insurer reiterated a
statement it made in June, noting it agreed to the settlement to
avoid the expense and risk of an ongoing class- action case. To
further enforce that spokesman Jim Lacey said just recently,
"The settlement will not have a material adverse effect on the
Company's financial position."
The complaints against Massachusetts Mutual Life Insurance and
several of its subsidiaries alleged that agents misled policy
owners into believing they would need to make only a limited
number of premium payments on permanent life insurance policies.
However, the lawsuit charged that the so-called "vanishing
premiums" were based on false representations about the
likelihood dividends or interest would accrue to such a level
that policy owners would no longer have to pay premiums.
According to the lawsuit, the Company encouraged agents to push
this type of policy rather than term life insurance by paying
them higher commissions, bonuses or other benefits.
Legal papers further revealed that owners of certain life and
disability insurance policies between 1983 and 2003 could be
eligible for part of the settlement. More than 8,200 New Jersey
residents bought certain covered policies between 1985 and 1989,
according to the suit.
The bulk of the settlement allows certain policyholders to
receive a supplemental death benefit, which, according to court
papers, "operates essentially to increase the face value of the
claimant's insurance coverage by a specified amount for a
specified period of time."
Some policyholders though objected to the settlement, arguing it
was unfair to certain people suing because they had a stronger
case than other class members.
For more information about the settlement, policy owners may
call an information center paid for by MassMutual by Phone:
(800) 242-7026.
MICHIGAN: Bank, Credit Issues Top MI Consumer Complaints Lists
--------------------------------------------------------------
As part of National Consumer Protection Week, Michigan Attorney
General Mike Cox announced the top consumer complaints of 2004
and urged Michigan residents to fight identity theft through
action and education. Banking and credit complaints - including
identify theft - continue to lead the annual list, followed by
telecommunication and cable or satellite TV complaints, with
complaints related to Internet use coming in third.
"Identity theft dominates the Top 10 list and I want to prevent
identity theft by educating and empowering consumers," Cox said.
"On March 1, Michigan residents will have access to free credit
reports and I encourage them to obtain this important identity
theft prevention tool. Through the continuation of the Attorney
General's `It's MI Identity' campaign, the office will educate
consumers on how to obtain and understand their free credit
reports, the importance of other identity theft prevention
measures, and what to do if they are victimized."
The Top 10 list was compiled from more than 18,400 written
complaints and 84,000 telephone inquiries received from
individuals and businesses. The 2004 Michigan Attorney General
Top 10 consumer complaint categories were:
(1) Banking and Credit Concerns: Includes disputes
regarding credit reports and collections, billing and
finance charges, misrepresenting the terms of credit,
and identity theft complaints.
(2) Telecommunications and Cable or Satellite TV: Includes
telemarketing, cramming (unauthorized charges),
slamming (unauthorized switch of a service provider),
do not call, cell phone, and identity theft complaints.
(3) Internet: A perennial top category that includes
Internet purchases and auctions, failure to deliver or
refund, fraudulent e- mail solicitations that may lead
to identity theft or fraudulent transfer of money, and
Internet service provider complaints.
(4) Retail: Includes misrepresentation of rights or
obligations, billing disputes, identity theft, quality
of merchandise, and scanner or pricing error
complaints.
(5) Motor Vehicle: Includes lemon law, advertising,
warranty, quality, and misrepresentation complaints.
(6) Mail Order: Includes failure to deliver or refund,
unsolicited merchandise, sweepstakes, and
misrepresentation complaints.
(7) Contractor: Home improvement contractors continue to be
the cause of complaints involving quality of work,
failure to deliver services or a refund, and warranty
issues.
(8) Gasoline/Fuel/Energy: This category includes
allegations of gasoline prices grossly in excess of
competitors, high utility rates, billing disputes, and
contract misrepresentation complaints.
(9) Small Business Service Providers: Breaking into the
Top 10 for the first time, this category includes
complaints by small business for unauthorized services
or goods, including advertising and directory
publications, unsolicited faxes, and leases for
business equipment that cannot be cancelled.
(10) Travel: Includes complaints related to travel clubs and
travel memberships, misrepresentations, fail to
deliver, failure to refund, and unsolicited faxes
promoting travel opportunities.
Protecting consumers continues to be a priority for Attorney
General Cox and his office continues to set records collecting
monies on behalf of the State of Michigan and Michigan
consumers. Through the efforts of the Attorney General's
Consumer Protection Division, more than $274 million was
collected on behalf of the State of Michigan and a record $3
million was directly refunded or forgiven to consumers in 2004.
To file a consumer complaint, Michigan residents can visit the
Attorney General's Web site: http://www.michigan.gov/agor mail
a letter explaining the problem to: Michigan Attorney General,
Consumer Protection Division, P.O. Box 30213, Lansing, MI 48909.
Consumers can also call the toll- free hotline at 1-877-SOLVE-88
(1-877-765-8388).
NBTY INC.: To Ask NY Court To Dismiss Securities Fraud Lawsuits
---------------------------------------------------------------
NBTY, Inc. intends to file a motion to dismiss the securities
class actions filed against it and certain of its officers and
directors in the United States District Court for the Eastern
District of New York, once these suits are consolidated.
During the period from June 24, 2004 through September 3, 2004,
six separate shareholder class actions were filed against the
Company and certain of its officers and directors on behalf of
shareholders who purchased shares of the Company's common stock
between February 9, 2004 and July 22, 2004. The actions allege
that the Company failed to disclose material facts during the
Class Period that resulted in a decline in the price of the
Company's stock after June 16, 2004 and July 22, 2004,
respectively.
These actions are stayed pending the Court's decision on the
unopposed motions, filed in August 2004, to consolidate the six
class actions and to appoint lead plaintiffs and lead counsel.
The suits are styled:
(1) Horn v. NBTY, Inc., et al, case no. 2:04-cv-02767-LDW-
ETB
(2) Melstein v. NBTY Inc., case no. 2:04-cv-03006-LDW-ETB
(3) Cato v. NBTY, Inc., case no. 2:04-cv-03825-LDW-ETB
(4) Ulmer v. NBTY, Inc., case no. 2:04-cv-02619-LDW-ETB
(5) Marcano v. NBTY, Inc., et al, case no. 2:04-cv-02687-
LDW-ETB
(6) Krupski v. NBTY, Inc., et al., case no. 2:04-cv-03208-
LDW-ETB
The suit is filed in the United States District Court for the
Eastern District of New York, under Judge Leonard D. Wexler.
Lawyers for the defendants are Robert Novack and Charles W.
Stotter of Edwards & Angell, LLP, 750 Lexington Avenue, New
York, NY 10022-1200, Phone: 973-376-7700, Fax: 973-376-3380, E-
mail: rnovack@ealaw.com or cstotter@edwardsangell.com. The
plaintiff firms in this litigation are:
(i) Cauley, Geller, Bowman, Coates & Rudman LLP (San Diego,
CA), 225 Broadway, Suite 1900, San Diego, CA, 92010,
Phone: 619.702.7350, Fax: 619.702.7351,
(ii) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com
(iii) Desmond Law Firm, 2161 Palm Beach Lakes Blvd., Suite
204, West Palm Beach, FL, 33409, Phone: 888337.6663, E-
mail: Info@SecuritiesAttorney.com
(iv) Finkelstein, Thompson & Loughran, 1050 30th Street, NW,
Washington, DC, 20007, Phone: 202.337.8000, Fax:
202.337.8090, E-mail: contact@ftllaw.com
(v) Milberg, Weiss, Bershad, Hynes & Lerach LLP (San Diego,
CA), 600 West Broadway, 1800 One America Plaza, San
Diego, CA, 92101, Phone: 800.449.4900, E-mail:
support@milberg.com
(vi) Paul C. Whalen
(vii) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(viii) Wechsler Harwood LLP, 488 Madison Avenue 8th Floor, New
York, NY, 10022, Phone: 212.935.7400, E-mail:
info@whhf.com
(ix) 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
(x) 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
NETOPIA INC.: CA Court Consolidates Securities Fraud Lawsuits
-------------------------------------------------------------
The United States District Court for the Northern District of
California ordered consolidated the securities class actions
filed against Netopia, Inc. under "In re Netopia, Inc.
Securities Litigation."
In August 2004, the first of four purported class action
complaints, "Valentin Serafimov, on behalf of himself and all
others similarly situated, v. Netopia, Inc., Alan B. Lefkof and
William D. Baker," was filed, alleging violations of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934, as
amended. The complaint alleged that during the purported class
period, November 6, 2003 and July 6, 2004, the Company made
materially false, misleading and incomplete statements and
issued false and misleading reports regarding its earnings,
product costs, and sales to foreign customers. The other three
complaints that subsequently were filed made additional related
claims based on the same announcements and allegations of
misstatements.
As provided in the Private Securities Litigation Reform Act of
1995, the plaintiffs in these actions filed motions to
consolidate and to appoint lead plaintiff and lead plaintiff
counsel. On December 3, 2004, the court issued an order
consolidating the cases and appointing a lead plaintiff and
plaintiff's counsel.
The litigation is styled "In re Netopia, Inc. Securities
Litigation," filed in the United States District Court for the
Northern District of California under Judge Ronald M. Whyte.
The Levy Group has been assigned as Lead Plaintiff. The law
firms in this litigation are:
(1) Braun Law Group, P.C., Phone: (888)658-7100, E-mail:
info@braunlawgroup.com
(2) Brian Felgoise, 230 South Broad Street, Suite 404,
Philadelphia, PA, 19102, Phone: 215.735.6810, Fax:
215/735.5185,
(3) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com
(4) Kirby, McInerney & Squire LLP, 830 Third Avenue 10th
Floor, New York Ave, NY, 10022, Phone: 212.317.2300,
(5) Lerach Coughlin Stoia Geller Rudman & Robbins (San
Diego), 401 B Street, Suite 1700, San Diego, CA, 92101,
Phone: 619.231.1058, Fax: 619.231.7423, E-mail:
info@lerachlaw.com
(6) Schatz & Nobel, P.C., 330 Main Street, Hartford, CT,
06106, Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com
(7) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(8) Spector, Roseman & Kodroff (Philadelphia), 1818 Market
Street; Suite 2500, Philadelphia, PA, 19103, Phone:
215.496.0300, Fax: 215.496.6610, E-mail:
classaction@srk-law.com
(9) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
NEW YORK: Steuben County Joins Suit Over Medicaid Reimbursement
---------------------------------------------------------------
Basing their claims on low Medicaid reimbursement rates for
nursing homes, Steuben County is joining other entities in a
class-action lawsuit against the state of New York, the Corning
Leader reports.
The Steuben County Health Care Facility is joining 62 health
care facilities in western New York to take on the state over
the 20-year-old base rate that they say does not keep pace with
the cost of providing basic care. Officials are reporting that
another 20 facilities from the Rochester area are likely to join
the court action as well.
While cautious, County Attorney Frederick Ahrens Jr. told the
county Legislature's Health and Education Committee that a
similar lawsuit was filed in the 1980s, which ended up in
settlements ranging near $1 million for participating agencies.
Mr. Ahrens also said that the law firm of Harter, Secrest and
Emery would represent Steuben County for a $5,250 retainer and
10 percent of the financial settlement.
While the new lawsuit may take years to settle, it could boost
the prospects of facilities now struggling to survive. "This is
a make-or-break reality for all nursing homes in the state,"
echoes Steuben County Health Care Facility Administrator John
Zehr. He also said that one purpose of the lawsuit is to prevent
the state from using a two-tiered reimbursement rate in the
future.
The state does pay a significantly higher Medicaid reimbursement
rate for new facilities built under state Department of Health
guidelines set after 1983. But the lower reimbursement rate,
which includes a small annual increase, has driven some older
private, non-profit and public facilities out of existence,
officials said, while others verge on bankruptcy.
According to the state Association of Nursing Homes and Services
for the Aging, during the past six years more than 100 adult
homes have closed in the state, displacing more than 5,100 low-
income residents.
NORTH CAROLINA: A.G. Cooper Cracks Down on 2 Telemarketing Firms
----------------------------------------------------------------
Two telemarketing fraud operations located in Canada and Florida
will no longer be able to cheat North Carolina consumers,
Attorney General Roy Cooper announced in a statement.
A.G. Cooper's office joined with U.S. and Canadian authorities
to shut down a major telemarketing fraud ring in Montreal.
Also, a Florida telemarketing firm that charged customers for
credit cards and credit relief services but failed to deliver
has been ordered to stop contacting North Carolina consumers, AG
Cooper announced.
"Telemarketing fraud artists are out to trick hard-working North
Carolinians out of their money," said the Attorney General.
"We'll keep going after these telemarketing outfits, whether
they're located here, in another state or another county."
A.G. Cooper's Telemarketing Fraud Prevention Project has worked
with Canadian and federal US officials in a two-year
investigation that resulted in the closure of First Choice
Teleservices' telemarketing centers in Montreal, Canada and the
arrest so far of more than 15 suspects. A.G. Cooper's office
works frequently with federal and international authorities to
track down telemarketing scammers and other fraud artists who
prey on North Carolinians.
One of Cooper's investigators is currently in Montreal assisting
those authorities with information provided by North Carolina
victims as well as information from Cooper's investigations into
related US-based firms. The suspects are alleged to have
defrauded consumers through a variety of scams, including false
promises of sweepstakes winnings and loans, grants and credit
cards in exchange for a fee. The case is being prosecuted by
the US Attorney for the Southern District of New York.
In Wake County Superior Court, Judge Donald W. Stephens granted
A.G. Cooper's request to stop another telemarketing firm,
Phoenix Consumer Services of Florida, from targeting North
Carolina consumers. Under terms of the preliminary injunction,
Phoenix must stop placing calls or mailing packages to North
Carolina while Cooper's case against the firm goes forward.
A.G. Cooper filed suit last week seeking to stop Phoenix from
violating laws on unfair and deceptive trade practices,
telemarketing sales and loan brokering and to win refunds for
North Carolina consumers. The telemarketing company, based in
Largo, FL, is the eighth outfit from that area that Cooper has
stopped from contacting North Carolina consumers with illegal
telemarketing pitches within the past four years.
As alleged in the complaint, Phoenix Consumer Services began
calling North Carolina consumers in early 2003 with offers of
pre-approved credit cards and credit repair services. The
telemarketers told consumers that if they paid a fee of $129.95,
the Company would improve their credit or send them a pre-
approved credit card within two weeks. After they paid the fee,
consumers got a packet of information about credit and how to
apply for credit cards from other financial institutions but no
one ever got a credit card or help with their credit. Consumers
who complained to Phoenix about the product and asked for a
refund were never granted one.
When Phoenix telemarketers made their pitch, they asked
consumers for their bank account information so the fee could be
drafted from their account. In some cases, the telemarketers
already had customers' bank account numbers and read them out
over the phone for confirmation. Some consumers who declined
Phoenix's pitch still had the fee debited from their account.
During one nine-month period, Phoenix attempted to debit fees
from at least 1,885 North Carolina consumers' bank accounts.
A total of 11 North Carolina consumers have filed complaints
about Phoenix with Cooper's Consumer Protection Division or the
Federal Trade Commission. However, United Parcel Service
records show that Phoenix mailed packets to more than 1,000
North Carolina addresses in a six-month period. A.G. Cooper's
office estimates that approximately 2,000 consumers across the
state may be victims of this group's scam. Any North Carolina
consumer who has dealt with Phoenix is encouraged to file a
complaint by calling 1-877-5-NO-SCAM.
Action against both Phoenix and First Choice Teleservices by
Cooper's Telemarketing Fraud Prevention Project is funded by the
US Department of Justice's Bureau of Justice Assistance.
"Telemarketers will use every trick in the book to get your
money, including dangling offers of easy credit over the phone,"
A.G. Cooper said. "To make sure you don't get lured in by these
offers, sign up for the Do Not Call Registry and then report any
telemarketer who calls you to my office."
To sign up for the Do Not Call list, consumers can call
1-888-382-1222 or visit the Website: http://www.nocallsnc.com.
Consumers whose numbers are listed on the Registry can file a
complaint with the Attorney General's Office by calling
1-877-5-NO-SCAM.
For more details, contact Noelle Talley, Public Information
Officer, N.C. Department of Justice, Phone: (919) 716-6484 or
(919) 716-6413, Fax: (919) 716-0803 E-mail: ntalley@ncdoj.com.
PENNSYLVANIA: Court Refuses To Allow Students To Join $1.4M Suit
----------------------------------------------------------------
A Commonwealth Court panel has refused to allow 1,800 Berks
County students to join a lawsuit that charges the Twin Valley
School District of improperly recording conversations on school
buses, the Associated Press reports.
The 2-1 ruling upheld a decision by Berks County Judge Jeffrey
L. Schmehl to deny class-action status in the $1.4 million suit
filed by Morgan Keppley. The judges ruled that Ms. Keppley, 24,
failed to show why the other students should be allowed to
become part of the suit.
According to court records, the recordings were made possible by
the district's decision to install audio-video cameras on buses
in March 1996. The cameras were disabled after Ms. Keppley filed
the suit in October 2001, which had claimed that the audio
taping violated Ms. Keppley's right to privacy while she was a
student between 1996 and 2000.
ROYAL SEAFOOD: Recalls Mushrooms Due To Undeclared Sulfites
-----------------------------------------------------------
Royal Seafood Baza, Inc. is recalling SMAK MARINATED MUSHROOMS
because it may contain undeclared sulfites. People who have
severe sensitivity to sulfites run the risk of serious or life-
threatening allergic reactions if they consume this product.
The recalled SMAK MARINATED MUSHROOMS, packed in glass jars with
metal tops, 30.5 oz., and code date Best Before:
07.05.2005/T/4539/DDA/8503 and SMAK MARINATED MUSHROOMS, packed
in glass jars with metal tops, 23.45 oz., and code date Best
Before: 09.03.2005/RL/458/DDH/1203, were sold in Net Cost
Markets in Brooklyn, NY and Philadelphia, PA.
The recall was initiated after routine sampling by New York
State Department of Agriculture and Markets Food Inspectors and
subsequent analysis by food laboratory personnel revealed the
presence of undeclared sulfites in SMAK MARINATED MUSHROOMS in
glass jars which did not declare sulfites on the label. The
consumption of 10 milligrams of sulfites per serving has been
reported to elicit severe reactions in some asthmatics.
Anaphylactic shock could occur in certain sulfite sensitive
individuals upon ingesting 10 milligrams or more of sulfites.
No illnesses have been reported to date in connection with this
problem.
Consumers who have purchased SMAK MARINATED MUSHROOMS should
return it to the place of purchase. Consumers with questions may
contact the Company at 1-718-318-1888.
SOBONITO INVESTMENTS: Inks Settlement With FTC Over Illegal Spam
----------------------------------------------------------------
An adult Web site operation that used illegal spam to drive
customers to its site has agreed to settle Federal Trade
Commission charges that the spam was deceptive and unfair and
violates federal law. The settlement will bar the operation from
using or hiring affiliates to send deceptive spam and require
that they comply with the CAN-SPAM Act, which bars deceptive
subject lines and return addresses, and requires a warning on
spam that is sexually explicit.
According to the FTC complaint, Sobonito Investments, Ltd. used
"affiliates" to advertise its Web sites and induce consumers to
purchase the adult content. The affiliates sent spam with
subject lines such as "Payment declined," and "I thought you
called" to disguise the contents of the spam. When consumers
opened the e-mail messages, they were subjected to sexually
explicit solicitations to visit the defendant's adult-oriented
Web sites. Because of the deceptive subject lines, consumers had
no reason to expect to see such material. In some cases,
consumers may have opened the e-mails in their offices, in
violation of Company policies. In other cases, children may have
been exposed to inappropriate adult-oriented material, the FTC
complaint noted. In addition, the affiliates used false header
information, identifying innocent third parties, as the sender
of the spam. Those innocent third parties risked damage to their
computer systems when angry victims of the original spam
responded to them. Consumers forwarded tens of thousands of the
affiliates' spam to the FTC's spam database at spam@uce.gov. The
agency charged that the practices were unfair and deceptive in
violation of federal law.
The settlement with Sobonito Investments, Ltd. bars it and its
agents, including affiliates, from using misleading subject
lines in e-mail messages, bars the use of false or misleading
headers, and bars them from violating or assisting others to
violate the CAN-SPAM Act, including its provision that requires
sexually oriented spam to carry the words "SEXUALLY-EXPLICIT: "
in the subject line. The settlement also contains standard
reporting and record keeping provisions to allow the FTC to
monitor compliance. Sobonito is incorporated in Cyprus.
For more details, contact the FTC's Consumer Response Center by
Mail: Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C.
20580 by Phone: 1-877-FTC-HELP (1-877-382-4357), or visit the
Website: http://www.ftc.gov. Also, contact Claudia Bourne
Farrell, Office of Public Affairs by Phone: 202-326-2181 or
Steven Baker or Steven M. Wernikoff, Midwest Region by Phone:
312-960-5634.
TIDEL TECHNOLOGIES: TX Court Approves Securities Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
Texas approved the settlement of the securities class action
filed against Tidel Technologies, Inc. and certain of its
officers and directors.
A purported class action was initially filed on October 31,
2001, styled "George Lehockey v. Tidel Technologies, et al., H-
01-3741." Subsequent to the filing of this suit, four identical
suits were also filed in the Southern District. On March 18,
2002, the Court consolidated all of the pending class actions
and appointed a lead plaintiff under the Private Securities
Litigation Reform Act of 1995 ("Reform Act").
On April 10, 2002, the lead plaintiff filed a Consolidated
Amended Complaint ("CAC") that alleged that the Defendants made
material misrepresentations and omissions concerning the
Company's financial condition and prospects between January 14,
2000 and February 8, 2001 (the putative class period).
In June 2004, the Company reached an agreement in principle to
settle these class action lawsuits. The settlement, which was
subject to a definitive agreement and court approval, provided
for a cash payment of $3 million to be funded by the Company's
liability insurance carrier and the issuance of two million
shares of common stock by the Company. In October 2004, the
court approved the settlement and the shares were issued in
November 2004.
UNITED STATES: Alliance For Justice Opposes Approval of S.5
-----------------------------------------------------------
Alliance for Justice raised a strong warning about the Senate
Judiciary Committee vote to approve of the Class Action Fairness
Act (S.5), and outlined a series of steps to mitigate the damage
this bill could do to consumer and environmental protections,
enforcement of state wage-and-hour and civil rights laws, and
efforts to deter corporations from production of negligent
products or fraudulent services.
"As passed in Committee, this bill will undermine longstanding
rights and protections that ordinary Americans take for
granted," stated Alliance for Justice President Nan Aron.
"Americans believe in fair justice, and that if you break
something, you should fix it. This bill eliminates those
fundamental principles, making it almost impossible for
individuals to join together to hold large corporations
responsible for the damages they cause. That is not justice
reformed, it is justice reversed. This bill will break a key
tenet of our legal system, and we call upon the full Senate to
fix it before it is signed into law."
The Class Action Fairness Act is a priority of the Bush
administration and the United States Chamber of Commerce. It
moves nearly all class actions filed in state court to federal
court, even when based solely on state law. A coalition of
consumer, civil rights, labor and environmental organizations
oppose the bill because it takes away the rights of individuals
to use their own state courts to bring class actions against
corporations that pollute communities, violate state wage-and-
hour laws, defraud consumers and negligently manufacture
defective products. These cases will languish in federal court
and many will never be certified as class actions.
Alliance for Justice and other members of the coalition are
actively pushing amendments that will fix the dangerous flaws in
the bill: an amendment to be offered by Sen. Bingaman and an
amendment to be offered by Sen. Kennedy. Sen. Bingaman's
amendment provides a mechanism for federal courts to certify
nationwide consumer class action. Under current law, federal
courts uniformly deny class certification in such cases. Sen.
Kennedy will offer an amendment to exempt state civil rights and
wage-and-hour cases from the bill so that workers and victims of
discrimination keep the right to use their own state courts for
these claims.
"We are asking senators to support these amendments to protect
the longstanding legal principle that if you do wrong, you
should make it right," Aron stated. "As it stands today, the
class action bill will make it easier for corporations to evade
accountability when they negligently break state law and make it
harder for individuals who are trying to make their voices heard
in our courts."
UNITED STATES: Big "I" Elated Over Progress Of Litigation Reform
----------------------------------------------------------------
The Independent Insurance Agents & Brokers of America, also
known as the Big "I", expressed its extreme elation about the
House of Representatives' moving forward on legislation to
reform the nation's class-action litigation system, the
Insurance Journal reports.
According to Charles Symington Jr., Big "I" senior vice
president of federal government affairs, "The introduction of a
bill in the House is a good sign, and we will be working to
ensure that true class action reform is enacted."
The Big "I" strongly supports reforms to the nation's class
action system, particularly changes that would put an end to so-
called 'venue shopping,' in which plaintiffs' lawyers steer
cases to particular state courts, which are trial lawyer
friendly. Such abuses of the system reportedly encourage
frivolous lawsuits and create hardships for small businesses,
including independent insurance agents and brokers.
A Senate markup of a similar bill, the Class Action Fairness
Act, has also been scheduled. The Big "I" is hopeful that both
houses of Congress can quickly pass legislation, iron out any
differences between the two versions, and get a bill before
President Bush for his signature as soon as possible. The
President has been very vocal in recent weeks on the need for
class-action reform and overarching legal reform in general,
including asbestos and medical-malpractice reform.
Mr. Symington states, "Our 300,000 members across America
strongly support legal reforms across the board, and we applaud
Congress and President Bush for making these necessary changes a
priority. We will work together with elected officials of either
party who understand the need to get our legal system under
control in a way that benefits both small businesspeople and
consumers."
UNITED STATES: Lawyers' Committee Calls For Amendments To S.5
-------------------------------------------------------------
The Lawyers' Committee for Civil Rights Under Law calls upon
Senators to amend the class action bill to insure that America's
workers are protected.
Senate Bill S.5, the so-called "Class Action Fairness Act," is
anything but fair to workers and victims of discrimination. The
bill would significantly impair access to the courts and delay
justice. A broad coalition of civil rights and labor
organizations urge the Senate to support the amendment being
offered by Senators Kennedy and Cantwell that would exempt civil
rights and wage and hour state law cases from the scope of the
bill.
"This bill takes away accountability for large companies like
the Enrons, Walmarts and Exxons of the world and strips rights
away from our nation's workers," said Michael L. Foreman, Deputy
Director of Legal Programs for the Lawyers' Committee for Civil
Rights. Cases brought under state labor laws or state civil
rights laws are not filed by nameless, faceless plaintiffs. They
are filed by low wage workers seeking their fair day's wages and
by individuals seeking to vindicate the equal rights guaranteed
by law.
Moving thousands of these cases into federal court will have
devastating consequences for workers and victims of
discrimination. The business backers of this bill know that long
delays in federal courts will discourage plaintiffs from
pursuing their legitimate claims.
"This would be a huge setback for those in the civil rights
community who work each day to fight injustice in the areas of
employment, housing, and education," said Mr. Foreman.
The Lawyers' Committee calls upon the Senate to reject big
business's attempt to escape responsibility for abusive
employment practices and discrimination. The exemption for civil
rights and wage and hour cases is a narrow amendment needed to
ensure that working men and women will have access to their own
state courts for cases brought under their own state law.
The Lawyers' Committee is a forty-year-old nonpartisan,
nonprofit civil rights legal organization, formed in 1963 at the
request of President John F. Kennedy to provide legal services
to address racial discrimination.
For more information on the Lawyers Committee, visit
http://www.lawyerscommittee.org.
UNITED STATES: President's State Of The Union Address Applauded
---------------------------------------------------------------
Business Roundtable President John J. Castellani hailed
President Bush's State of the Union address saying it promoted
innovative, pro-growth approaches that will benefit all
Americans.
"The President's speech articulated the right agenda, at the
right time, for the right reasons -- to grow this economy and
safeguard the economy in the future," said Mr. Castellani. He
adds, "Our highest priority is fostering strong economic growth
that will result in more jobs for American workers, and the
President spoke to that goal."
Mr. Castellani noted that several of the President's priorities
resonated with those outlined by the Roundtable: "We are
focused, as is the President, in reducing costs to business and
consumers by curbing lawsuit abuse," he said. "This abuse costs
our economy $246 billion per year, and has increased a
hundredfold over the past 50 years. The real tragedy is that
those harmed get less than 50 cents on the dollar in today's
court system."
"We will work to strengthen the financial security of our
nation's retirees by reforming Social Security, which is safe
for current seniors but is in danger for future generations. The
Roundtable believes that reforms should strengthen Social
Security's long-term financial foundation, protect benefits for
current retirees and those near retirement, and provide the
option of personal accounts to younger workers."
"We look forward to improvement in the health care marketplace
through successful implementation of the Medicare Modernization
Act, through improving information technology and creating
incentives for disease protection and wellness."
"These priorities -- and efforts to continue to strengthen the
education of our nation's students, improve homeland security,
and preserve and protect the environment -- are critical
components of a strong and competitive U.S. economy. We look
forward to working with the Administration and Congress on these
important objectives."
Business Roundtable (http://www.businessroundtable.org)is an
association of chief executive officers of leading corporations
with a combined workforce of more than 10 million employees in
the United States and $4 trillion in revenues. The chief
executives are committed to advocating public policies that
foster vigorous economic growth and a dynamic global economy.
UNITED STATES: Senate Panel OK's Measure To Curb Frivolous Suits
----------------------------------------------------------------
A delicate compromise that would curb class-action lawsuits and
achieve one of President Bush's second-term goals endured its
first test when senators foiled attempts to alter the
legislation, the Associated Press reports.
However, Democrats are hoping to make changes to the bill that
many of them would not mind seeing fail, according to Sen.
Joseph Biden, D-Del., "This is a bad idea whose time has
apparently come."
In a majority 13-5 vote, the Senate Judiciary Committee approved
the overall bill, known as the Class Action Fairness Act, S.5,
which would send the majority of class-action suits to federal
court, who are assumed to be less likely than state courts to
award multimillion-dollar verdicts to people suing big
companies. The Republican-controlled Senate is set to tackle the
measure next week.
Supporters will try to get the legislation to the GOP-dominated
House, which has agreed to support the bill if it is not
substantially changed. According to the chairman of the Senate
Judiciary Committee, Sen. Arlen Specter, R-Pa., "We have a very
sensitive agreement with the House of Representatives on this
bill, and if there are amendments it may jeopardize the
acquiescence of the House on our bill."
Democrats though are already preparing amendments, including
proposals to raise judges' salaries and let federal judges
decide which state's law would apply in multi-state suits. But,
according to Republicans, making those changes will break the
agreement with the House and kill the bill.
The president has said that curbing class action cases will be
one of his second-term priorities. Senators who support the bill
have long contended that greedy lawyers make more money from
these cases than do the actual victims, and that lawyers
sometimes threaten companies with legal action just to get quick
financial settlements.
As written, the bill has enough backing from Democrats and
Republicans to survive a filibuster attempt in the Senate. Even
Senate Majority Leader Bill Frist, R-Tenn., and Senate Minority
Leader Harry Reid, D-Nev., have agreed not to support major
changes. Senator Frist said, "If we can succeed in passing a
clean bill through the Senate, it is my expectation that the
House will act quickly and we can send a bill to the president."
Furthermore, lawmakers said that House Republican leaders,
including Judiciary Chairman James Sensenbrenner, R-Wis., would
make sure the legislation receives a warm reception if it is not
substantially changed. But just in case something happens to the
Senate compromise, House Republicans have again introduced their
own bill, which they say is tougher than the Senate version. "If
the Senate compromise agreement falls though, then the House is
ready to move forward with its legislation," said Rep. Bob
Goodlatte, R-Va.
Opponents of the bill said it was aimed at helping businesses
escape multimillion-dollar judgments for their wrongdoing and
would hurt lawyers trying to litigate those cases. Sen. Patrick
Leahy, D-Vt., who tried to get the committee to add the judges'
pay provision even stated, "It benefits the special interests,
but I don't see how it benefits the citizens of individual
states."
Under the Senate proposal, class-action suits in which the
primary defendant and more than one-third of the plaintiffs are
from the same state still would be heard in state court. But if
less than one-third of the plaintiffs were from the same state
as the primary defendant, the case would go to federal court. It
will also require that at least $5 million would have to be at
stake for a class-action suit to be heard in federal court.
New Securities Fraud Cases
ASTRAZENECA PLC: Smith & Smith Files Securities Fraud Suit in MA
----------------------------------------------------------------
The law offices of Smith & Smith LLP initiated a securities
class action lawsuit on behalf of shareholders who purchased
securities of AstraZeneca PLC ("AstraZeneca" or the "Company")
(NYSE:AZN), between April 2, 2003 and October 11, 2004,
inclusive (the "Class Period"). The class action lawsuit was
filed in the United States District Court for the District of
Massachusetts.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period
concerning the Company's prospects, thereby artificially
inflating the price of AstraZeneca securities. No class has yet
been certified in the above action.
For more details, contact Smith & Smith LLP by Phone:
(866) 759-2275 or by E-mail: howardsmithlaw@hotmail.com.
DIRECT GENERAL: Lasky & Rifkind Lodges Securities Suit in TN
------------------------------------------------------------
The law firm of Lasky & Rifkind, Ltd., initiated a lawsuit in
the United States District Court for the Middle District of
Tennessee, on behalf of persons who purchased or otherwise
acquired publicly traded securities of Direct General Corp.
("Direct General" or the "Company") (NASDAQ:DRCT) between August
11, 2003 and January 26, 2005, inclusive, (the "Class Period").
The lawsuit was filed against Direct General and William Adair,
Jr., Barry Elkins, Brian Moore, Jacqueline Adair, and Tammy
Adair ("Defendants").
The complaint alleges that Defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. Specifically, the complaint alleges that
Defendants concealed from investors the negative effect of a
change in the Florida Personal Injury Protection scheme would
have on the Company's business operations. The Company also
failed to properly reserve for its insurance losses as a result
of the change in the Florida statute.
On January 26, 2005, the Company indicated in a press release
that its current reserves were inadequate and disclosed for the
first time the negative impact of the Florida PIP Statute was
having on its operations. Shares of Direct General reacted
negatively to the news, falling from $28.49 per share to $19.61
per share, a decline of 31.1% in heavy volume.
For more details, contact Leigh Lasky, Esq. of The Law Firm of
Lasky & Rifkind, Ltd. by phone: 800-495-1868.
DIRECT GENERAL: Marc S. Henzel Files Securities Fraud Suit in TN
----------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the United
States District Court for the Middle District of Tennessee on
behalf of purchasers of the securities of Direct General Corp.
(NASDAQ: DRCT) between August 11, 2003, through January 26,
2005, inclusive, (the "Class Period"), seeking to pursue
remedies under the Securities Exchange Act of 1934 (the
"Exchange Act").
The action is pending against defendants Direct General Corp.,
William Adair, Jr., Barry Elkins, Brian Moore, Jacqueline Adair,
and Tammy Adair. The complaint alleges that throughout the Class
Period, Defendants issued, or caused to be issued, false and
misleading statements to artificially inflate the value of
Direct General Stock. Specifically, Defendants concealed from
the investing public the negative effect a change in the Florida
Personal Injury Protection scheme would have on the Company's
business operations. The Company also failed to properly reserve
for its insurance losses as a result of the change in the
Florida statute. While the stock's value was just a few dollars
from its Class Period high, and almost $15 from its current
price, Defendants and other insiders sold over 3.3 million
shares for net proceeds of $108 million. On January 26, 2005,
the Company admitted that its current reserves were inadequate
and disclosed for the first time the substantial impact the
revised Florida PIP Statute was having on its operations.
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 by E-
mail: mhenzel182@aol.com.
EPIX PHARMACEUTICALS: Smith & Smith Lodges Securities Suit in MA
----------------------------------------------------------------
The law firm of Smith & Smith LLP initiated a securities class
action lawsuit on behalf of shareholders who purchased
securities of EPIX Pharmaceuticals, Inc. ("EPIX" or the
"Company'') (Nasdaq:EPIX), between July 10, 2003 and January 14,
2005, inclusive (the "Class Period''). The class action lawsuit
was filed in the United States District Court for the District
of Massachusetts.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period
concerning the Company's prospects and financial performance,
thereby artificially inflating the price of EPIX securities. No
class has yet been certified in the above action.
For more details, contact Smith & Smith LLP by Phone:
(866) 759-2275 or by E-mail: howardsmithlaw@hotmail.com.
GANDER MOUNTAIN: Marc S. Henzel Lodges MN Securities Fraud Suit
---------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the United
States District Court for the District of Minnesota on behalf of
purchasers of Gander Mountain Company (NASDAQ: GMTN) common
stock pursuant to the Company's Initial Public Offering ("IPO")
and on the open market between April 20, 2004 and January 13,
2005 (the "Class Period").
The complaint charges Gander Mountain and certain of its
officers and directors with violations of the Securities
Exchange Act of 1934 and the Securities Act of 1933. Gander
Mountain is a specialty retailer offering an assortment of
merchandise that caters to outdoor lifestyle enthusiasts, with a
particular focus on hunting, fishing and camping.
The complaint alleges that prior to going public (and even
afterward) Gander Mountain was controlled by the Erickson family
(including certain of the defendants named in the complaint)
through their individual ownership in the Company as well as
their holdings in the Company's major shareholders. Defendants
knew that unless the Company went public, their shares in the
Company would remain illiquid, and virtually worthless. Further,
defendants were also keenly aware that unless the Company went
public prior to revelations of lowered earnings expectations in
November 2004 and January 2005, the Company would be prevented
from going public altogether. This possibility would not only
jeopardize defendants' ability to infuse value and liquidity
into their shares via the IPO, but also would jeopardize the
Company's ability to repay a $9.8 million debt owed to a Company
owned by the Erickson family.
On April 26, 2004, Gander Mountain closed its IPO of 6,583,750
shares of its common stock and converted existing preferred
stock to common stock, raising in excess of $105 million. On
November 9, 2004, the Company announced it had "lowered its
outlook for pretax income for fiscal 2004 to a range of $8
million to $13 million, compared with the Company's prior
guidance of $16 million to $21 million." Then, on January 14,
2005, the Company issued a press release lowering its outlook
for pretax income for fiscal 2004 even further, "to a range of
$2.0 million to $4.0 million, compared with the Company's prior
guidance of $8 million to $13 million." On this news, the
Company's shares plunged to an all time low of $9.30 per share,
more than a 60% drop from the Class Period high of $24.65 on
June 7, 2004.
According to the complaint, the true facts, which were known to
each of the defendants during the Class Period and concealed
from the public, were as follows:
(1) the Company's co-branded credit card program was
faltering;
(2) the value of the Company's inventory was overstated,
requiring massive reductions and causing the Company's
future margins to be negatively impacted as a result;
(3) the Company's debt capacity was jeopardized and was
inconsistent with defendants' own growth plans;
(4) the Company was actually experiencing average trends
with respect to its sales; and
(5) as a result of the above, defendants' own projections
of positive comparable sales growth of 3%-5% and pretax
income of $8-$13 million were materially false and
misleading.
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 by E-
mail: mhenzel182@aol.com.
GANDER MOUNTAIN: Schiffrin & Barroway Lodges MN Securities Suit
---------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
District of Minnesota on behalf of all securities purchasers of
Gander Mountain Company ("Gander Mountain" or the "Company")
from April 20, 2004 through January 13, 2005, inclusive (the
"Class Period").
The complaint charges Gander Mountain, Mark R. Baker, Dennis M.
Lindahl, Gerald A. Erickson, Donovan A. Erickson, Neal D.
Erickson, Richard A. Erickson, Marjorie J. Pihl and Ronald A.
Erickson, with violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder and Sections 11 and 15 of Securities Act of 1933.
More specifically, the Complaint alleges that the Company failed
to disclose and misrepresented the following material adverse
facts which were known to defendants or recklessly disregarded
by them:
(1) that the Company's co-branded credit card promotions
were ineffective;
(2) that the Company's inventory was overstated, which
forced Gander Mountain to offer 40 to 60 percent
discounts in order to move its merchandise;
(3) that the Company was funding its overly aggressive
expansion by borrowing above its revolving credit line;
(4) that the Company had difficulties establishing a
specific direction for it merchandise, by continuously
changing the products and services offered to
customers, thereby failing to establish continuity;
(5) the Company's same store sales were in the negative;
and
(6) and that as a consequence of the foregoing, defendants
lacked a reasonable basis for their positive statements
about the Company's growth and prospects.
On November 9, 2004, the Company lowered its outlook for pretax
income for fiscal 2004 to a range of $8 million to $13 million,
compared with the Company's prior guidance of $16 million to $21
million. The news shocked the market. Shares of Gander fell
$4.64 per share, or 25.01 percent, on November 9, 2004, to close
at $13.91 per share. On January 14, 2005, before the markets
opened, Gander Mountain lowered its outlook for pretax income
for fiscal 2004 to a range of $2.0 million to $4.0 million,
compared with the Company's prior guidance of $8 million to $13
million. On this news shares of Gander Mountain fell $1.86 per
share, or 16.47 percent, on January 14, 2005, to close at $9.43
per share.
For more details, contact Marc A. Topaz, Esq. or Darren J.
Check, Esq. of Schiffrin & Barroway, LLP by Mail: 280 King of
Prussia Road, Radnor, PA 19087 by Phone: 1-888-299-7706 or
1-610-667-7706 Or by E-mail: info@sbclasslaw.com.
PHARMOS CORPORATION: Schor Greenwald Files Securities Suit in NJ
----------------------------------------------------------------
The law firm of Schor, Greenwald & Levy initiated a class action
lawsuit in the United States District Court for the District of
New Jersey on behalf of all purchasers of Pharmos Corp.
("Pharmos" or the "Company") (Nasdaq:PARS) securities during the
period from August 23, 2004 through December 17, 2004, inclusive
(the "Class Period").
The action charges Pharmos and certain of its senior officers
with violations of Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The
alleged violations stem from the dissemination of false and
misleading statements, which had the effect -- during the Class
Period -- of artificially inflating the price of Pharmos's
shares.
During the Class Period, defendants concealed the fact that
Dexanabinol, the Company's flagship drug product, which had
completed enrollment for Phase III trials for Traumatic Brain
Injury (TBI), was not exhibiting materially favorable reactions.
Prior to disclosing this information to the public, Pharmos sold
$16.75 million worth of stock in a private placement.
Furthermore, the Company's CEO sold 20% of his holdings and its
President sold almost 50% of his holdings. Such sales occurred
after the close of Phase III enrollment and after the six month
post-enrollment period concluded. On December 20, 2004, just
weeks after insiders sold 400,000 shares of stock, they
announced Dexanabinol was not found to be materially effective
in Phase III testing. Furthermore, after years of touting the
effectiveness of Dexanabinol, the Company abruptly ceased its
effort to gain approval for Dexanabinol for TBI.
For more details, contact Jacob Greenwald of SCHOR, GREENWALD &
LEVY by Mail: 4 Taas St. (145 Bialik St.), Ramat-Gan 52512 by
Phone: 972-3-6136633 or by Fax: 972-3-6136644 OR Vivian Lee of
KIRBY McINERNEY & SQUIRE, LLP by Mail: 830 Third Avenue, 10th
Floor, New York, New York 10022 by Phone: (212) 317-2300 or
888-529-4787 or by E-Mail: vlee@kmslaw.com.
SIERRA WIRELESS: Charles J. Piven Lodges Securities Suit in NY
--------------------------------------------------------------
The Law Offices Of Charles J. Piven, P.A. today announced that a
securities class action was commenced on behalf of shareholders
who purchased, converted, exchanged or otherwise acquired the
common stock of Sierra Wireless, Inc. (Nasdaq:SWIR) between
January 28, 2004 and January 26, 2005, inclusive (the "Class
Period").
The case is pending in the United States District Court for the
Southern District of New York against defendant Sierra Wireless
and one or more of its officers and/or directors. 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: (410) 986-0036 or by E-mail:
hoffman@pivenlaw.com.
SIERRA WIRELESS: Marc S. Henzel Lodges Securities Suit in NY
------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the United
States District Court for the Southern District of New York on
behalf of purchasers of Sierra Wireless, Inc. (NASDAQ: SWIR)
common stock during the period between January 28, 2004 and
January 26, 2005 (the "Class Period").
The complaint charges Sierra and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Sierra develops and markets a range of products, including
wireless data modems for portable computers, embedded modules
for original equipment manufacturers, rugged vehicle-mounted
modems and mobile phones. In addition, Sierra has recently
entered into the Smartphone market with its Voq product line.
The Complaint alleges that, throughout the Class Period,
defendants issued numerous statements concerning the Company's
performance and future prospects. As alleged in the Complaint,
these statements were materially false and misleading when made
as they failed to disclose these material adverse facts then
known to defendants or recklessly disregarded by them:
(1) that Sierra's strategy to correct its deficiency in
technology as compared to its competitors by
introducing the Voq Smartphone was flawed and its
business model was not working;
(2) that Sierra was facing increasing competition,
intensified by its failure to enter into the WCDMA
(wideband code-division multiple access) market;
(3) that Sierra's recent venture into the Smartphone market
with the introduction of its new Voq line was a serious
misstep, as it did little to add revenue and further
seriously harmed Sierra's relationship with a prime
customer palmOne as its Voq Smartphone would compete
with palmOne's Treo - the product for which Sierra was
a supplier;
(4) that Sierra's dependence on revenue from palmOne in its
original equipment manufacturer ("OEM") business -
selling embedded modules that allow other device
manufacturers to give their products wireless
connectivity - was substantially greater than had been
reported; and
(5) that Sierra's customers were materially over-
inventoried, which would lead to greatly diminished
orders and sales in future quarters.
On January 26, 2005, after the market closed for regular
trading, Sierra issued a press release announcing its financial
results for the fourth quarter of 2004 and provided guidance for
the first quarter of 2005. Specifically, Sierra announced that
its revenue for the fourth quarter of 2004 was well below the
previous guidance that it had given to investors and further
announced that it expected a steep decline in its revenue going
forward. Following this announcement, on January 27, 2005, the
next day of trading, Sierra's stock plunged 38% to a 52-week low
of $8.97 per share, on extremely heavy trading volume.
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 by E-
mail: mhenzel182@aol.com.
SIERRA WIRELESS: Schiffrin & Barroway Lodges Stock Suit in NY
-------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of all purchasers of the
common stock of the Sierra Wireless, Inc. (NASDAQ: SWIR)
("Sierra Wireless" or the "Company") from January 28, 2004
through January 26, 2005, inclusive (the "Class Period").
The complaint charges Sierra Wireless and certain of its
officers and directors 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 introduction of the Sierra Wireless' Voq-
branded professional phones was a complete and utter
disaster because it harmed the Company's relationship
with its biggest customer, palmOne and ultimately lead
to palmOne's decision to stop purchasing embedded
modules from Sierra Wireless;
(2) that Sierra Wireless' decision to invest in Voq
development at the expense of a UMTS card lead to a
serious reduction in revenues;
(3) that Sierra Wireless' dependence on palmOne revenue was
significantly greater than had been reported;
(4) that Sierra Wireless was facing increasing competition
in the PC Card market due to its out-dated technology;
and
(5) that due to the Company's out-dated PC Cards, many of
Sierra's major customers had excess inventory of its
products.
On January 26, 2005, after the market closed for regular
trading, Sierra issued a press release announcing its financial
results for the fourth quarter of 2004 and provided guidance for
the first quarter of 2005. Specifically, Sierra announced that
its revenue for the fourth quarter of 2004 was well below the
previous guidance that it had given to investors and further
announced that it expected a steep decline in its revenue going
forward. News of this shocked the market. Shares of Sierra
Wireless, on January 27, 2005, fell $5.53 per share, or 38.14
percent, to close at $8.97 per share on unusually heavy trading
volume.
For more details, contact Marc A. Topaz, Esq. or Darren J.
Check, Esq. of Schiffrin & Barroway, LLP by Mail: 280 King of
Prussia Road, Radnor, PA 19087 by Phone: 1-888-299-7706 or
1-610-667-7706 Or by E-mail: info@sbclasslaw.com.
SIERRA WIRELESS: Smith & Smith Files Securities Fraud Suit in NY
----------------------------------------------------------------
The law offices of Smith & Smith LLP initiated a securities
class action lawsuit on behalf of shareholders who purchased
securities of Sierra Wireless, Inc. ("Sierra Wireless" or the
"Company") (Nasdaq:SWIR), between January 28, 2004 and January
26, 2005, inclusive (the "Class Period"). The class action
lawsuit was filed in the United States District Court for the
Southern District of New York.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period
concerning the Company's prospects and financial performance,
thereby artificially inflating the price of Sierra Wireless
securities. No class has yet been certified in the above action.
For more details, contact Smith & Smith LLP by Phone:
(866) 759-2275 or by E-mail: howardsmithlaw@hotmail.com.
SIPEX CORPORATION: Smith & Smith Lodges Securities Suit in CA
-------------------------------------------------------------
The law offices of Smith & Smith LLP initiated a securities
class action lawsuit on behalf of shareholders who purchased
securities of Sipex Corporation ("Sipex" or the "Company")
(Nasdaq:SIPX), between April 10, 2003 and January 20, 2005,
inclusive (the "Class Period"). The class action lawsuit was
filed in the United States District Court for the Northern
District of California.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period
concerning the Company's operations and financial performance,
thereby artificially inflating the price of Sipex securities. No
class has yet been certified in the above action.
For more details, contact Smith & Smith LLP by Phone:
(866) 759-2275 or by E-mail: howardsmithlaw@hotmail.com.
SYSTEMATIC INVESTMENT: Blumenthal & Markham Lodges CA Stock Suit
----------------------------------------------------------------
The law firms of Blumenthal & Markham, Brewer & Carlson LLP and
Greco, Traficante & Edwards initiated a class action the United
States District Court for the Southern District of California.
The complaint seeks to recover, on behalf of all persons who
still owned their Systematic Investment Plan ("SIP") on December
15, 2004 ("Class Members"), all amounts paid into First
Command's Systematic Investment Plan for indirect interests in
mutual-fund shares which had not been withdrawn as of December
15, 2004 ("Class Period"). This case is entitled McPhail, et al.
v. First Command Financial Planning, Inc., Case No. 05 CV 0179
IEG (JMA).
The complaint alleges that First Command and certain of its
officers and directors violated the Securities Exchange Act of
1934 and the Investment Advisers Act. The complaint further
alleges that the defendants' conduct also violated the Texas
Deceptive Trade Practices Act, California's Unfair Competition
Act and First Command's fiduciary duties to investors. First
Command is a seller of investment plans and insurance
principally to military personnel.
The complaint alleges that, during the Class Period, defendants
through an affinity marketing scheme made false and misleading
statements regarding First Command's investment plans and
insurance. Specifically, the case involves First Command's
marketing and sales of indirect interests in mutual-fund shares
through an SIP. The defendants are alleged to have made false
statements and concealed the truth with respect to the SIP, the
effect of the charges associated with this investment, and the
investment alternatives. The facts, known by each of the
defendants, but concealed from the investing public during the
Class Period are alleged to be as follows:
(1) the First Command SIP was among the worst, if not the
worst, investment of its kind for the Class Members;
(2) First Command's SIPs have no redeeming financial upside
potential and the same minimum downside risks as
comparable investments;
(3) an investment in a Thrift Savings Plan ("TSP") was an
undisputedly better investment alternative for military
personnel than First Command's SIP;
(4) only 43% of First Command clients retained their SIP
long enough to even receive their principal back;
(5) the recommended whole life insurance plans coupled with
the SIP were inappropriate for the Class Members;
(6) First Command did not tailor investment plans to the
specific needs of each Class Member;
(7) First Command steered Class Members to SIPs based
solely on fact that First Command received
substantially more in fees (50% of the first year's
deposit) from the SIPs;
(8) the majority of First Command customers have not
completed the 15-year period of the SIP;
(9) the Family Financial Plan ("FFP") was not an objective
and truthful investment plan;
(10) the long-term costs of owning no-load funds are
substantially lower than the costs of owning load funds
such as SIPs;
(11) the no-load investment index funds offered by the TSP
had substantially lower net expense ratios than even a
no-load fund and most certainly the SIPs sold by First
Command; and,
(12) there was no empirical evidence to support the
inference that SIPs will outperform other funds due to
low "cash-flow volatility."
As a result of the defendants' false and misleading statements,
and concealment of facts known to them, Class Members were
placed into unsuitable investments and paid excessive sales
commissions and fees to defendants in connection with the
purchase of publicly traded securities.
On December 15, 2004 the Securities & Exchange Commission
("SEC") instituted a public administration and cease and desist
proceeding against First Command. In response to the SEC
proceeding and related disciplinary actions by the National
Association of Securities Dealers ("NASD"), First Command
submitted an Offer of Settlement which the SEC accepted, and
submitted a Letter of Acceptance, Waiver, and Consent to the
NASD which provided for restitution only to those customers who,
as of December 15, 2004, had already terminated their First
Command SIP. As a result, no relief was provided to the Class
Members.
For more details, contact Norman Blumenthal of Blumenthal &
Markham by Phone: 858/551-1223, ext. 120 or by E-mail:
Bam@bamlawlj.com OR Mark Brewer or Dan Carlson of Brewer &
Carlson LLP by PhoneL 858/558-7766 or by E-mai:
gmbrewer@brewercarlson.com OR Peter Shulz of Greco, Traficante &
Edwards by Phone: 619/234-3660 or by E-mail: pjs@gtelaw.com or
visit their Web site: http://www.bamlawca.com.
TASER INTERNATIONAL: Glancy Binkow Lodges Securities Suit in AZ
---------------------------------------------------------------
The law firm of Glancy Binkow & Goldberg LLP initiated a Class
Action lawsuit in the United States District Court for the
District of Arizona on behalf of a class (the "Class")
consisting all persons or entities who purchased or otherwise
acquired securities of TASER International Inc. ("TASER" or the
"Company") (Nasdaq:TASR) between October 19, 2004 and January
10, 2005, inclusive (the "Class Period").
The Complaint charges TASER and certain of the Company's
executive officers with violations of federal securities laws.
Plaintiff claims defendants' omissions and material
misrepresentations concerning TASER's financial performance and
prospects artificially inflated the Company's stock price,
inflicting damages on investors. TASER develops and manufactures
less-lethal self-defense devices. The Complaint alleges that
during the Class Period defendants failed to disclose or
indicate that:
(1) the Company actively and continually obscured the truth
about the safety of its TASERs;
(2) even after it was revealed that more than 70 people had
died in North America in TASER-related incidents, the
Company vehemently asserted that its weapons were safe,
in order to maintain profitability;
(3) the Defendants accelerated a distribution deal with
Davidson's Inc. in fourth quarter 2004, in order to
book the revenue, so TASER did not have to report its
first quarter-to-quarter revenue decline in nearly two
years; and
(4) as a result, the Company lacked any reasonable basis
for any statements it made regarding profitability and
safety.
On January 6, 2005, just before midnight, TASER announced that
it was the subject of an informal inquiry by the Securities &
Exchange Commission into Company statements concerning the
safety of its products and that the SEC sought information
concerning a large end-of-quarter sale to one of the Company's
distributors. On this news, TASER shares fell $4.90 per share,
or 17.74 percent, on January 7, 2005, to close at 22.72 per
share. On Monday, January 10, 2005, TASER shares tumbled another
$2.67 per share or 11.75 percent, to close at $20.05 per share.
For more details, contact Lionel Z. Glancy or Michael Goldberg
of Glancy Binkow & Goldberg LLP by Phone: (310) 201-9150 or
(888) 773-9224 by Mail: info@glancylaw.com or visit their Web
site: http://www.glancylaw.com.
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asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
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Copyright 2005. All rights reserved. ISSN 1525-2272.
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