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C L A S S A C T I O N R E P O R T E R
Thursday, March 17, 2005, Vol. 7, No. 54
Headlines
AMERIQUEST MORTGAGE: Agrees To Pay $50M To Settle With Borrowers
BELL CANADA: Customers Launch Complaint Over Fraudulent Calls
BROOKSTONE CO.: Trial Set For NV Inventor's Suit Over Knockoffs
BURLEY TOBACCO: KY Judge Grants Class Status To Growers' Lawsuit
CALIFORNIA: Berkeley Unified Settles Expelled Students' Lawsuit
CALIFORNIA: Ex-Owners Of Oil Refinery Reach Tentative Settlement
CIENA CORPORATION: NY Court Approves Securities Suit Settlement
CRYOLIFE INC.: Discovery Closes in GA Securities Fraud Lawsuit
ECZEMA DRUGS: FDA Issues Advisory Due To Potential Cancer Risks
EXPRESS SCRIPTS: Plaintiffs Seek Certification For MO Lawsuits
EXPRESS SCRIPTS: Plaintiffs Seek Certification For Consumer Suit
EXPRESS SCRIPTS: Moves For Partial Summary Judgment in NJ Suit
EXPRESS SCRIPTS: GA Court Grants Summary Judgment For Lawsuit
EXPRESS SCRIPTS: Court Yet To Rule on CA Suit Dismissal Appeal
EXPRESS SCRIPTS: Asks CA Court To Dismiss Consumer Fraud Lawsuit
EXPRESS SCRIPTS: Moves For Summary Judgment in CA Consumer Suit
EXPRESS SCRIPTS: Parties To Dismiss CA Unfair Competition Suit
EXPRESS SCRIPTS: Pharmacies Launch Antitrust Lawsuit in N.D. CA
EXPRESS SCRIPTS: Asks NY Court To Dismiss Consumer Fraud Lawsuit
EXPRESS SCRIPTS: Asked NY Court To Dismiss ERISA Violations Suit
EXPRESS SCRIPTS: Shareholders Launch Stock Lawsuits in E.D. MO
EXPRESS SCRIPTS: Seeks Transfer of ERISA Fraud Suit To E.D. MO
FLORIDA: Gov. Jeb Bush Proposes Changes To Curb Lawsuit Abuse
HANS KISSLE: Recalls Tuna Fish Salad For Listeria Contamination
JANUS CAPITAL: Faces Suits For Mutual Fund Trading Malpractice
LABORATORY CORPORATION: NC Court Mulls Dismissal of Stock Suit
MISSISSIPPI: Judge Grants Certification To Foster Care Lawsuit
NORTH CAROLINA: AG Warns Tobacco Program Participants V. Fraud
NUVEEN INVESTMENTS: Shareholders Launch Stock Fraud Suits in IL
OWENS CORNING: Judge Dismisses Shareholder Suit, Cites Statutes
TADIAN HOMES: Homeowners Lodge Suit Over Construction Practices
TENNESSEE: Both Parties Ordered To Split Costs in Crematory Case
TEXAS: AG Abbott Warns Firms Of Consumer Info Security Threats
UNITED RETAIL: Former Employees Launch Overtime Wage Suit in CA
UNITED STATES: Arbitration Service Reverses Class Action Policy
New Securities Fraud Cases
CELL THERAPEUTICS: Chitwood & Harley Files Securities Suit in WA
ECHOSTAR COMMUNICATIONS: Marc S. Henzel Files CO Securities Suit
ELAN CORPORATION: Marc S. Henzel Lodges MA Securities Fraud Suit
ELAN CORPORATION: Stull Stull Lodges Securities Fraud Suit in NY
FOREST LABORATORIES: Marc S. Henzel Lodges Securities Suit in NY
SIPEX CORPORATION: Goldman Scarlato Sets Lead Plaintiff Deadline
*********
AMERIQUEST MORTGAGE: Agrees To Pay $50M To Settle With Borrowers
----------------------------------------------------------------
Orange County-based Ameriquest Mortgage Co. has agreed to pay up
to $50 million to settle a class-action lawsuit that alleges it
defrauded thousands of borrowers in four states, including
California, the Los Angeles Times reports.
The proposed settlement in the class-action suit will go before
a San Mateo Superior Court judge June 24 for final approval. If
the settlement is approved, individual borrowers could opt out
of it to pursue their own suits. Michael J. Cereseto, an
attorney representing Ameriquest, which is the nation's largest
mortgage lender to people with spotty credit or modest incomes,
said the Company hadn't admitted any liability in agreeing to
settle the case.
In a press statement, the Company said, "We are satisfied that
the terms of the settlement are fair and that the settlement
allows Ameriquest to focus all of its attention on providing
credit to millions of Americans. The settlement pertains to some
issues that are nearly 10 years old."
The suit, filed by Burlingame, California, law firm Cotchett,
Pitre, Simon & McCarthy, accused Ameriquest employees of
surprising borrowers at loan closings with high fees and
interest rates that often were markedly higher than had been
promised in good-faith estimates of the loan costs. In
addition, the suit alleges that employees used ruses such as
telling the borrowers their old loans had already been paid off
to pressure them into accepting new loans.
The proposed settlement would give refunds to certain California
customers who received loans from 1996 through February 2004,
and other borrowers in Texas, Alabama and Alaska who took out
loans from 1998 through February 2004. To qualify for the
proposed settlement, the annual percentage rate on the
borrowers' loans must have risen by more than 0.9 percentage
point from the good-faith estimate provided early in the loan
process until the closing. Class members whose loans were made
between February 3, 2003, when Ameriquest said it initiated
"fixed pricing" that protected consumers and February 29, 2004,
must swear that they were subjected to "bait and switch"
tactics, since their claims could be challenged by the Company.
Court documents reveal that class members could also be entitled
to a 50% refund of any prepayment penalties if their preliminary
loan disclosures did not reflect that the loan might have
contained such a penalty. Ameriquest has identified 1,671 class
members who may fall into that category. According to estimates
filed with the proposed settlement, a few borrowers might
qualify for five-figure refunds from the Company.
An Ameriquest spokesman said he anticipated there would be few
refunds, noting that an economist hired by the Company had
determined that in nearly 70% of the loans, the annual
percentage rate decreased between the time of the good-faith
estimate of costs and when the loan closed, the LA Times
reports. Ameriquest would pay at least $15 million, and no more
than $50 million, under the terms of the deal, the spokesman
said.
BELL CANADA: Customers Launch Complaint Over Fraudulent Calls
-------------------------------------------------------------
Montrealers Annie Blanchette and C‚dric Carignan-Leblanc are
asking the Quebec Superior Court to authorize a class action
lawsuit against Bell Canada, CBC News reports.
The two want the Company to reimburse customers for long
distance phone calls they say they didn't make. Ms. Blanchette
and Mr. Carignan-Leblanc claim that they were billed a total of
$337 in long distance charges. Their phone bills included calls
to Sao Tome, the Cook Islands, and Guinea Bissau that were
placed in October 2003 and July 2004. According to the two they
didn't make the calls and were both the victims of fraud by
phone hackers, noting they complained to Bell but the Company
refused to reimburse them.
They contend that they've taken legal action because Bell has a
duty to provide secure service to its clients. In their
statement of claims, they allege that Bell has known for years
about phone frauds involving half a dozen locations, yet has not
put an automatic call-blocking program in place. The suit seeks
reimbursements plus interest on behalf of all defrauded
customers. Bell though has not yet filed court documents in
response to the claim.
BROOKSTONE CO.: Trial Set For NV Inventor's Suit Over Knockoffs
---------------------------------------------------------------
Dayton artist and inventor Steven Saylor's lawsuit against
Brookstone Co., which is claiming that the catalog and retail
sales Company stole one of his inventions and then had a cheap
knockoff produced in Taiwan, has been scheduled for a May 31
jury trial before U.S. District Judge Edward Reed in Reno,
Nevada federal court, the Associated Press reports.
Mr. Saylor is seeking more than $20 million in damages from the
Merrimack, N.H.-based Company, after learning that Brookstone,
which had carried his trademark "CarPad" vinyl floor cover for
garages for several years, had sold thousands of the imitations
starting in 2001. In an interview, Mr. Saylor told AP, "We try
to be honest and fair with everyone. That's the way you do
things. You don't go out and steal things from people and
defraud them. Brookstone seems to have had a different idea."
Lawyers for Brookstone though countered that Mr. Saylor's patent
is invalid and he's not protected under federal trademark law,
AP reports.
According to court documents, Mr. Saylor learned about the
knockoffs while checking to see why orders for his product had
fallen off. He wound up ordering one of what were supposed to be
his own floor covers, which sell for about $120, through
Brookstone and was shipped an inferior product made in Taiwan.
Mr. Saylor states, "I got a box of trash. It was terrible. They
didn't even do a good job of knocking it off. It was a wrinkled
mess."
Besides his local counsel, Bob Cox, attorney Joel Joseph of the
Made in the USA Foundation also represents Mr. Saylor. Mr.
Joseph says that what's happened to his client is part of "a
larger and larger problem across the country." According to him,
"We've brought cases against many major American stores and
catalog companies," adding, "One of the last bastions of
American superiority is in the design of products. If we lose
that, we're really in trouble." Mr. Joseph told AP that a
class-action lawsuit might be filed in the case, in addition to
the pending case in the federal court in Reno.
Robert Padgett, spokesman for Brookstone, told AP Mr. Saylor's
claims are unfounded and Brookstone switched suppliers as part
of "a normal business decision that does not violate any local,
state or federal laws."
"Mr. Saylor appears to be upset that Brookstone decided to carry
a different and better-performing product and is venting his
anger in court," Mr. Padgett said, adding that Brookstone
already has prevailed on some pretrial motions - including one
to invalidate Mr. Saylor's patent.
In his pretrial ruling invalidating the patent last year, Judge
Reed said Mr. Saylor's floor pad "doesn't seem like a very new
or novel idea." He added it didn't seem like something that
others could be prevented from manufacturing "no matter how you
doll it up."
BURLEY TOBACCO: KY Judge Grants Class Status To Growers' Lawsuit
----------------------------------------------------------------
Fayette County District Judge Bruce Bell granted class-action
status to a lawsuit against the Burley Tobacco Growers
Cooperative, which is seeking $22.8 million in reserves the co-
op has accumulated since 1992, the Associated Press reports.
Filed by eight burley growers, the lawsuit contends that the
Lexington-based co-op had violated its own bylaws by not
distributing the reserve to its member farmers in 1992 after it
refinanced its debt to the federal Commodity Credit Corporation.
Judge Bell granted class-action status on behalf of as many as
144,000 burley growers in Kentucky, Indiana, Ohio, West Virginia
and Missouri, he however denied the plaintiffs' request for a
summary judgment.
According to the judge, the summary judgment motion was "a
pretty close call," but "I believe there are some issues of fact
that should be heard by a jury." The judge told the lawyers in
the case, "I think you guys need to get together and try to
resolve this thing." He also said that he would order mediation
"at some point" if the parties didn't move in that direction, AP
reports.
Robert E. Maclin, an attorney for the eight growers, told AP the
co-op's board and management had acted in "an opportunistic way"
to hold onto the money while paying fees to 25 directors,
salaries to staff members and funding "trips and junkets all
over the world."
However, co-op attorney John W. Bilby contends that the alleged
"trips and junkets" were actually necessary travel related to
the tobacco reform bill passed by Congress in 2004 that ended
the burley price support program. Furthermore, he argued that
the co-op had been required by the federal government to keep
the $22.8 million reserve to protect the Commodity Credit Corp.
from losses on other loans held by the co-op.
The lawsuit seeks an accounting of all funds handled by the co-
op since 1982 on behalf of two groups namely burley growers
whose tobacco did not sell at auction in 1982 and those with
tobacco in any co-op auction between 1983 and 2002. No date for
a trial has been set.
CALIFORNIA: Berkeley Unified Settles Expelled Students' Lawsuit
---------------------------------------------------------------
A closely watched civil rights lawsuit against the Berkeley
Unified School District, which was filed by African American and
Latino students, who alleged that they were denied their
constitutional right to a formal hearing before being excluded
from school for various disciplinary reasons, was settled out of
court, the AScribe Newswire reports.
Under the out of court settlement, the students who filed the
federal class action lawsuit, entitled Smith v. Berkeley Unified
School District, in August 2004 for being wrongfully expelled
from Berkeley High School will be allowed to return to classes.
According to William Abrams, co-counsel on the case and senior
partner at the law firm Pillsbury Winthrop LLP, who represented
the plaintiffs on a pro bono basis, "This is a noteworthy
victory for the students and the community. Now that their due
process rights have been enforced, the students can get back to
the classroom and move forward with their education."
Pillsbury Winthrop hooked up with Stanford Law School's Youth
and Education Law Clinic and San Francisco-based Legal Services
for Children in championing the rights of the Berkeley students
in the Smith case. Additionally, as part of the settlement in
the case, the Berkeley School District has committed to respect
the constitutional rights of students, and to reduce the
disproportionate impact of its policies on students of color.
Once the district court approves the settlement, the affected
students will be reinstated to school and will receive tutoring
and other services to compensate for the time they were
wrongfully excluded.
Lagertha Smith, mother of Yarman Smith, one of the student
plaintiffs in the case, expressed her elation at reaching the
settlement by saying, "I am very pleased with the settlement
because it not only affects my son, but it will prevent other
students from being mistreated in the future. Being involved in
this lawsuit has given my son more self esteem, since he was
empowered to stand up for his rights," the AScribe Newswire
reports
Bill Koski, director of the Youth and Education Law Clinic
added, "To Superintendent Michelle Lawrence's credit, the
Berkeley School District recognizes that students are entitled
to due process. The agreement reached yesterday shows that the
district is committed to ensuring that students will no longer
be wrongfully excluded from Berkeley schools."
CALIFORNIA: Ex-Owners Of Oil Refinery Reach Tentative Settlement
----------------------------------------------------------------
A tentative settlement was reached in a class-action lawsuit
against Equilon Enterprises and Texaco, the former owners of
Bakersfield's biggest oil refinery, the KGET 17, CA reports.
Both oil firms have agreed to pay nearly $3 million to 347
plaintiffs in a groundwater contamination case filed four years
ago. However, many of those plaintiffs aren't happy with the
terms of that settlement.
According to court documents, the lawsuit claims that Equilon
Enterprises and Texaco were liable for a wide array of medical
problems afflicting residents of the now abandoned Gaslite
Mobile Home Park. Plaintiffs attorneys even claimed that their
clients became sick after drinking and bathing in well water
contaminated by gasoline and MTBE spills at the refinery in the
1990's.
Plumes of contaminants containing benzene and MTBE had drifted
off site into water wells serving the trailer park and several
industrial companies. As precaution, the oil companies later
supplied the trailer park with bottled water, but eventually
they bought the trailer park in 1999 and paid to relocate some
of the residents.
A Los Angeles law firm filed suit four years ago, alleging the
oil companies concealed the true extent of contamination from
Gaslite residents. That lawsuit blamed tenant illnesses,
including cancer, to Equilon's contamination of groundwater.
The case isn't going to trial since the plaintiffs started
receiving letters in the mail this week informing them of a
tentative settlement in the case. The letters stated that the
oil companies have agreed to pay $2.8 million in damages.
However, the individual damage awards are small, ranging from
$3,000 to $300 per plaintiff.
Lead attorney Michael Arias said there were high levels of
benzene in the Gaslite well during an 11-month period, so any
plaintiff who didn't live there during that period wouldn't be
compensated for exposure to benzene. He also told KGET 17 that
he couldn't go to trial without clear and convincing evidence
linking MTBE to medical illnesses. Since the gasoline additive
is still not listed as a known cancer-causing agent, even his
own experts wouldn't testify that there was a direct link, he
adds. Additionally, Mr. Arias said even with his 40 percent cut
of the settlement, his law firm still loses money in this case.
CIENA CORPORATION: NY Court Approves Securities Suit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of a
consolidated securities class action filed against Ciena
Corporation, as a result of its merger with ONI Systems
Corporation.
Beginning in August 2001, a number of substantially identical
class action complaints alleging violations of the federal
securities laws were filed against ONI Corporation and:
(1) Hugh C. Martin, ONI's former chairman, president and
chief executive officer;
(2) Chris A. Davis, ONI's former executive vice president,
chief financial officer and administrative officer; and
(3) certain underwriters of ONI's initial public offering
The complaints were consolidated into a single action, and a
consolidated amended complaint was filed on April 24, 2002. The
amended complaint alleges, among other things, that the
underwriter defendants violated the securities laws by failing
to disclose alleged compensation arrangements (such as
undisclosed commissions or stock stabilization practices) in the
initial public offering's registration statement and by engaging
in manipulative practices to artificially inflate the price of
ONI's common stock after the initial public offering. The
amended complaint also alleges that ONI and the named former
officers violated the securities laws on the basis of an alleged
failure to disclose the underwriters' alleged compensation
arrangements and manipulative practices. No specific amount of
damages has been claimed.
Similar complaints have been filed against more than 300 other
issuers that have had initial public offerings since 1998, and
all of these actions have been included in a single coordinated
proceeding. Mr. Martin and Ms. Davis have been dismissed from
the action without prejudice pursuant to a tolling agreement. In
July 2004, following mediated settlement negotiations, the
plaintiffs, the issuer defendants (including Ciena), and their
insurers entered into a settlement agreement, whereby the
plaintiffs' cases against the issuers are to be dismissed.
The plaintiffs and issuer defendants subsequently moved the
court for preliminary approval of the settlement agreement,
which motion was opposed by the underwriter defendants. On
February 15, 2005, the district court granted the motion for
preliminary approval of the settlement agreement, subject to
certain modifications to the proposed bar order, and directed
the parties to submit a revised settlement agreement reflecting
its opinion.
CRYOLIFE INC.: Discovery Closes in GA Securities Fraud Lawsuit
--------------------------------------------------------------
Discovery has closed in the consolidated securities class action
filed against CryoLife, Inc. and certain of its officers in the
United States District Court for the Northern District of
Georgia.
Several putative class action lawsuits were filed in July
through September 2002, alleging violations of Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 based on a
series of purportedly materially false and misleading statements
to the market. The suits were consolidated, and a consolidated
amended complaint filed, which principally alleges that the
Company made misrepresentations and omissions relating to
product safety and the Company's alleged lack of compliance with
certain FDA regulations regarding the handling and processing of
certain tissues and other product safety matters. The
consolidated complaint seeks certification of a class of
purchasers between April 2, 2001 and August 14, 2002,
compensatory damages, and other expenses of litigation.
The Company and the other defendants filed a motion to dismiss
the consolidated complaint on February 28, 2003, which the court
denied in part and granted in part on May 27, 2003. The
discovery phase of the case commenced on July 16, 2003. On
December 16, 2003, the court certified a class of individuals
and entities who purchased or otherwise acquired the Company's
stock from April 2, 2001 through August 14, 2002. At present,
discovery in the case has closed, and the Court has instructed
the parties to serve their dispositive motions, if any, by March
11, 2005.
The suit is styled "Robert Murray and Richard A. Pearson,
individually and on behalf of all others similarly situated v.
Cryolife, Inc., Steven G. Anderson, Albert E. Heacox, James C.
Vander Wyk and D. Ashley Lee," and pending in the United States
District Court for the Northern District of Georgia, Atlanta
Division. Attorneys for the plaintiffs are:
(1) Martin D. Chitwood and Nikole Davenport of Chitwood &
Harley, Mail: 2900 Promenade II, 1230 Peachtree Street,
NE Atlanta, Georgia 30309, Phone: 404-873-3900, Fax:
404-876-4476
(2) Sherrie R. Savett, Carole A. Broderick, Barbara A.
Podell, David F. Sorensen of Berger & Montague PC, 1622
Locust Street, Philadelphia, PA 19103, Phone: 215-875-
3000, Fax: 215-875-4604
For more information, visit
http://securities.stanford.edu/1024/CRY02-
01/20020827_o01c_022388.pdf
ECZEMA DRUGS: FDA Issues Advisory Due To Potential Cancer Risks
---------------------------------------------------------------
The Food and Drug Administration (FDA) advised health care
professionals to prescribe Elidel (pimecrolimus) and Protopic
(tacrolimus) only as directed and only after other eczema
treatments have failed to work because of a potential cancer
risk associated with their use. In addition, FDA is adding a
black box warning to the health professional label for the two
products and developing a Medication Guide for patients.
The actions follow the recommendations made by the FDA's
Pediatric Advisory Committee during its February 15, 2005
meeting. At this meeting, findings of cancer in three different
animal species were reviewed. The data showed that the risk of
cancer increased as the amount of the drug given increased. The
data also included a small number of reports of cancers in
children and adults treated with Elidel or Protopic.
The manufacturers of the products have agreed to conduct
research to determine whether there is an actual risk of cancer
in humans, and, if so, its extent. Both products are applied to
the skin to control eczema by suppressing the immune system.
FDA's Public Health Advisory specifically advises physicians to
weigh the risks and benefits of these drugs in adults and
children and consider the following:
(1) Elidel and Protopic are approved for short-term and
intermittent treatment of atopic dermatitis (eczema) in
patients unresponsive to, or intolerant of other
treatments.
(2) Elidel and Protopic are not approved for use in
children younger than 2 years old. The long-term effect
of Elidel and Protopic on the developing immune system
in infants and children is not known. In clinical
trials, infants and children younger than 2 years of
age treated with Elidel had a higher rate of upper
respiratory infections than those treated with placebo
cream.
(3) Elidel and Protopic should be used only for short
periods of time, not continuously. The long term safety
of these products is unknown.
(4) Children and adults with a weakened or compromised
immune system should not use Elidel or Protopic.
(5) Use the minimum amount of Elidel and Protopic needed to
control the patient's symptoms. The animal data suggest
that the risk of cancer increases with increased
exposure to Elidel or Protopic.
Protopic was approved in 2000 and Elidel in 2001 to treat
eczema.
EXPRESS SCRIPTS: Plaintiffs Seek Certification For MO Lawsuits
--------------------------------------------------------------
Plaintiffs filed motions for class certification and partial
summary judgment in the consolidated securities class action
filed in the United States District Court for the Eastern
District of Missouri, under Judge Stephen N. Limbaugh.
The first suit, styled "Minshew v. Express Scripts, Cause No.
Civ.4:02-CV-1503," was filed on December 12, 2001 in the United
States District Court for the District of Arizona. The case was
subsequently transferred to the Federal District Court for the
Eastern District of Missouri. The plaintiff asserts that certain
of the Company's business practices, including those relating to
its contracts with pharmaceutical manufacturers for
retrospective discounts on pharmaceuticals and those related to
its retail pharmacy network contracts, violate fiduciary duties
that the Company allegedly owes to certain of its clients under
the Federal Employee Retirement Income Security Act (ERISA). The
putative class consists of health benefit plans that are self-
funded by an employer client. The complaint seeks money damages
and injunctive relief on behalf of this class of health plans.
Another suit, styled "Mixon v. Express Scripts, Inc.," Civil
Action No. 4:03CV1519, was filed in the same court on October
23, 2003, and it purports to be class action on behalf of
participants or beneficiaries of any ERISA plan which required
the participant or beneficiary to pay a percentage co-payment on
prescription drugs during the period from October 1, 1997 to the
present.
The case alleges that certain of the Company's business
practices, including those relating to its contracts with
pharmaceutical manufacturers for retrospective discounts on
pharmaceuticals and those related to its retail pharmacy network
contracts, violated alleged fiduciary duties under ERISA. The
plaintiff seeks an accounting and unspecified damages. The
Company filed a motion to dismiss this case on standing grounds
which was denied. This case has been coordinated with "Minshew"
in the Eastern District of Missouri.
Discovery is proceeding in this litigation. Plaintiffs have
filed motions for class certification and partial summary
judgment on the issue of the Company's fiduciary status under
ERISA.
EXPRESS SCRIPTS: Plaintiffs Seek Certification For Consumer Suit
----------------------------------------------------------------
Plaintiffs asked the Superior Court of New Jersey, Law Division,
Camden County to certify a class in the lawsuit filed against
Express Scripts, Inc., styled "International Association of
Firefighters, Local No. 22, et al. v. National Prescription
Administrators and Express Scripts, Inc., Cause No. L03216-02."
On August 16, 2002, the Company was served with this lawsuit
alleging that its subsidiary, National Prescription
Administrators (NPA), had breached agreements with two benefit
plans to whom NPA had provided services under an umbrella
agreement with a labor coalition client. The Company was also
named as a defendant under a theory of de facto merger. The
plaintiffs purport to bring the action on behalf of a class of
similarly situated plans. The lawsuit alleges that NPA had not
paid the plans the rebates to which they were entitled under the
agreement. Claims for unspecified money damages are asserted
under the New Jersey Consumer Fraud Act (the CFA), and for
breach of contract and unjust enrichment.
The Company filed answers denying liability. On July 23, 2004,
summary judgment was granted in favor of NPA and ESI on the
customer fraud counts. Plaintiff filed a motion to certify a
class of all members of the labor coalition, approximately 80
plans. The Company filed a response opposing the motion.
EXPRESS SCRIPTS: Moves For Partial Summary Judgment in NJ Suit
--------------------------------------------------------------
Express Scripts, Inc. filed a motion for partial summary
judgment in the class action filed against it, its subsidiary
National Prescription Administrators (NPA) and Benecard
Prescription Services in the Superior Court of New Jersey, Law
Division, Camden County, styled "City of Paterson, et al. v.
Benecard Prescription Services, et. al, Cause No. L-005908-02."
On September 13, 2002, plaintiffs filed this action against
Benecard Prescription Services (Benecard) and the Company's
subsidiary, NPA, alleging violations of the New Jersey Consumer
Protection Act. The allegations by the plaintiffs assert that
various business practices of the defendants violated the
statute. Neither the Company nor NPA owns any interest in
Benecard, which is an independent entity. Subsequently,
Plaintiff added the Company as a defendant and added claims for
common law fraud, negligent misrepresentation, and breach of
contract. Plaintiffs purport to represent a class of similarly
situated plaintiffs and seek unspecified monetary damages.
Both NPA and ESI have filed answers denying liability. On March
7, 2004, the Company's motion for summary judgment on the
consumer protection counts was granted. Benecard's motion for
partial summary judgment dismissing the class action allegations
was granted.
EXPRESS SCRIPTS: GA Court Grants Summary Judgment For Lawsuit
-------------------------------------------------------------
The Superior Court of Fulton County, Georgia granted summary
judgment in favor of Express Scripts, Inc. in the class action
styled "Deborah R. Bauer v. Express Scripts, Inc., case no.
2002CV60672."
Plaintiff filed suit on October 29, 2002, claiming that the
Company misclassified the prescription drug tamoxifen citrate as
a brand drug. Plaintiff claims that tamoxifen citrate is a
generic drug for purposes of determining the proper co-payment
under her health plan. She seeks to prosecute her claim on
behalf of a nationwide class of tamoxifen citrate users who are
members of health benefit plans using the Company's services.
Plaintiff's motion for class certification, which the Company
opposed, was denied by the court. Summary judgment has been
granted in favor of Express Scripts, and no appeal was taken
from this judgment.
EXPRESS SCRIPTS: Court Yet To Rule on CA Suit Dismissal Appeal
--------------------------------------------------------------
The United States Ninth Circuit Court of Appeals has yet to rule
on plaintiffs' appeal of a lower court ruling dismissing the
class action filed against Express Scripts, Inc. and other
pharmacy benefit management companies, styled "Jerry Beeman, et
al. v. Caremark, et al. Cause No. 021327."
The complaint, filed by several California pharmacies as a
putative class action, alleged that the Company, and the other
defendants, failed to comply with statutory obligations under
California Civil Code Section 2527 to provide our California
clients with the results of a bi-annual survey of retail drug
prices. On July 12, 2004, the case was dismissed with prejudice
on the grounds that the plaintiffs lacked standing to bring the
action, an earlier Class Action Reporter story (November 9,2004)
states.
The suit is styled "Jerry Beeman & Pharm, et al v. Caremark,
Inc., et al., case no. 5:02-cv-01327-VAP-SGL," filed in the
United States District Court for the Central District of
California, under Judge Virginia A. Phillips. Representing the
plaintiffs are:
(1) Michael A. Bowse, Bonny A. Sweeney, Milberg Weiss
Bershad Hynes & Lerach, 355 S Grand Ave, Ste 4170, Los
Angeles, CA 90071-3172, Phone: 213-617-9007, Fax: 213-
617-9185
(2) Allan Browne, Browne & Woods, 450 N Roxbury Dr, 7th Fl
Beverly Hills, CA 90210-4231, Phone: 310-274-7100
(3) Alan M. Mansfield, Helen D. Rosner, Rosner Law and
Mansfield, 10085 Carroll Canyon Road, First Fl, San
Diego, CA 92131, Phone: 858-348-1005, E-mail:
alan@rosnerandlaw.com
Representing the Company are:
(i) Christopher Chorba, Gail E. Lees, Gibson Dunn &
Crutcher, 333 S Grand Ave, 45th Fl, Los Angeles, CA
90071-3197, Phone: 213-229-7000
(ii) Thomas M Dee, Angela S. Quinn, Christopher A. Smith,
Christopher J. Valeriote, Husch & Eppenberger, 190
Carondelet Plaza, Ste 600, St Louis, MO 63105-3441
Phone: 314-480-1500
(iii) Douglas C Rawles, Morgan Lewis & Bockius, 300 S Grand
Ave, 22nd Fl, Los Angeles, CA 90071-3132, Phone: 213-
612-2500
EXPRESS SCRIPTS: Asks CA Court To Dismiss Consumer Fraud Lawsuit
----------------------------------------------------------------
Express Scripts, Inc. asked the Superior Court for the State of
California, Los Angeles County to dismiss the class action filed
against it and other companies, styled "Anthony Bradley, et al
v. First Health Services Corporation, et al., case no.
BC319292."
On July 30, 2004, plaintiffs filed a complaint as a putative
class action, alleging rights to sue as a private attorney
general under California law. The complaint alleges that the
Company, and the other defendants, failed to comply with
statutory obligations under California Civil Code Section 2527
to provide its California clients with the results of a bi-
annual survey of retail drug prices. Plaintiffs request
injunctive relief, unspecified monetary damages and attorneys
fees. Several of the plaintiffs are the same as in "Beeman, et
al v. Caremark, et al," and the relief sought is substantially
the same as that sought in Beeman.
EXPRESS SCRIPTS: Moves For Summary Judgment in CA Consumer Suit
---------------------------------------------------------------
Express Scripts, Inc. filed a motion for summary judgment in the
class action filed against it and its subsidiary National
Prescription Administrators (NPA), styled "Lynch v. National
Prescription Administrators, et al., Cause No. 03 CV 1303," in
the United States District Court for the Southern District of
New York.
This action was filed on February 26, 2003. The plaintiff, a
trustee of the Health and Welfare Fund and the Retiree Health
and Welfare Fund of the Patrolmen's Benevolent Association of
the City of New York, alleges that certain business practices of
NPA and the Company violate duties said to be owed to the class
members, including duties under the Employee Retirement Income
Security Act (ERISA), state common law, and state consumer
protection statutes. The putative class consists of all current
and former self-funded ERISA and non-ERISA employee benefit
plans for which NPA or the Company served as PBM. The suit seeks
unspecified monetary damages and declaratory and injunctive
relief.
The suit is styled "Lynch et al v. NPA Inc. et al, case no. :03-
cv-01303-GBD-JCF," filed in the United States District Court for
the Southern District of New York, under Judge George B.
Daniels. Representing the Company are:
(1) Mark G. Arnold, Joseph P. Conran, Thomas M. Dee, Husch
& Eppenberger, LLC, St. Louis, MS
(2) Kenneth R. Logan, Jayma M. Meyer, Arthur L. Smith,
Simpson, Thacher & Bartlett, L.L.P., 425 Lexington
Avenue, New York, NY 10017-3954, Phone: (212) 455-2000,
E-mail: klogan@stblaw.com
Representing the plaintiffs are John T. Brennan, The Law Offices
of John T. Brennan, P.C., 26 Court Street, Suite 710, Brooklyn,
NY 11242, Phone: (718) 923-5640, Fax: (718) 923-5641, E-mail:
lo.jtb@verizon.net; and Jeffrey J. Corrigan and Jeffrey L.
Kodroff, Spector, Roseman & Kodroff, P.C., 1818 Market Street,
Suite 2500, Philadelphia, PA 19103, Phone: (215) 496-0300.
EXPRESS SCRIPTS: Parties To Dismiss CA Unfair Competition Suit
--------------------------------------------------------------
Parties have agreed to dismiss the class action filed against
Express Scripts, Inc. in the Superior Court of the State of
California, styled "American Federation of State, County &
Municipal Employees (AFSCME) v. AdvancePCS, et al., case no.
BC292227."
This action was filed on March 17, 2003. The case purports to be
a class action on behalf of AFSCME, its California member unions
having non-Employee Retirement Income Security Act (ERISA)
health plans, and all California public employees who
participate in non-ERISA health plans. The complaint alleges
that certain business practices engaged in by us and other PBM
defendants violated California's Unfair Competition Law. The
suit seeks unspecified monetary damages and injunctive relief.
This case was coordinated with the "Irwin" case in this court,
as described below. A stipulated dismissal has been signed by
the parties and filed with the court. However, a judgment has
not been entered and if a judgment is entered, plaintiffs retain
the right to appeal.
Another suit, styled "Irwin v. AdvancePCS, et al., case no.
RG030886393," was filed in the Superior Court of the State of
California for Alameda County on March 26, 2003. This case is
brought by plaintiff alleging his right to sue as a private
attorney general under California law. This case purports to be
a class action against the Company and other pharmacy benefit
manager (PBM) defendants on behalf of self-funded, non-ERISA
health plans; and individuals with no prescription drug benefits
that have purchased drugs at retail rates.
The complaint alleges that certain business practices engaged in
by the Company and by other PBM defendants violated California's
Unfair Competition Law. The suit seeks unspecified monetary
damages and injunctive relief. This case has been coordinated
with the AFSCME case in Los Angeles County Superior Court.
EXPRESS SCRIPTS: Pharmacies Launch Antitrust Lawsuit in N.D. CA
---------------------------------------------------------------
Express Scripts, Inc. continues to face a class action filed in
the United States District Court for the Northern District of
Alabama, styled "North Jackson Pharmacy, Inc., et al. v. Express
Scripts, Civil Action No. CV-03-B-2696-NE."
This case purports to be a class action against the Company on
behalf of independent pharmacies within the United States. The
complaint alleges that certain of its business practices violate
the Sherman Antitrust Act, 15 U.S.C 1, et. seq. The suit seeks
unspecified monetary damages (including treble damages) and
injunctive relief.
The suit is styled "North Jackson Pharm, et al v. Express
Scripts Inc, et al, case no. 5:03-cv-02696-VEH," filed in the
United States District Court for the Northern District of
Alabama, under Judge Virginia Emerson Hopkins.
Representing the Company are A Kelly Brennan, Gregory C. Cook,
BALCH & BINGHAM LLP, PO Box 306 Birmingham, AL 35201-0306,
Phone: 251-8100, Fax: 488-5828, E-mail: kbrennan@balch.com,
gcook@balch.com; and Peter E. Kazanoff, Kenneth R. Logan, Jama
M. Meyer, SIMPSON THACHER & BARTLETT LLP, 425 Lexington Avenue
New York, NY 10017-3954, Phone: 212-455-3525, Fax: 212-455-2502,
E-mail: pkazanoff@stblaw.com, klogan@stblaw.com,
jmeyer@stblaw.com.
Representing the plaintiffs are:
(1) Andrew C Allen, Othni J. Lathram, Joe R. Watley,
WHATLEY DRAKE LLC, 2323 Second Avenue North Post Office
Box 10647, Birmingham, AL 35202-0647, Phone: 328-9576,
E-mail: ecf@whatleydrake.com, jwhatley@whatleydrake.com
(2) Chris W. Cantrell, A. David Fawal, Archie Lamb, Jr.,
LAW OFFICES OF ARCHIE LAMB LLC, PO Box 2088,
Birmingham, AL 35201, Phone: 324-4644, Fax: 324-4649,
E-mail: ccantrell@archielamb.com,
dfawal@archielamb.com, alamb@archielamb.com
(3) Gail A McQuilkin, Harley Tropin, KOZYAK TROPIN &
THROCKMORTON PA, 2525 Ponce de Leon, 9th Floor Coral
Gables, FL 33134, Phone: 305-372-1800, fax: 305-372-
3508, E-mail: gam@kttlaw.com or hst@kttlaw.com
EXPRESS SCRIPTS: Asks NY Court To Dismiss Consumer Fraud Lawsuit
----------------------------------------------------------------
Express Scripts, Inc. asked the United States District Court for
the Southern District of New York to dismiss the class action
filed against the Company, styled "Scheuerman, et al v. Express
Scripts, case no. 04-CV-0626 (FIS) (RFT)."
This action was filed on April 26, 2004. This case purports to
be a class action filed on behalf of all individuals who receive
health benefits through the New York Health Insurance Program.
The complaint alleges that certain business practices constitute
a breach of fiduciary injunction relief and unspecified monetary
damages.
EXPRESS SCRIPTS: Asked NY Court To Dismiss ERISA Violations Suit
----------------------------------------------------------------
Express Scripts, Inc. asked the United States District Court for
the Southern District of New York to dismiss the class action
filed against it, styled "Correction Officers' Benevolent
Association of the City of New York, et al v. Express Scripts,
Inc., case no. 04-Civ-7098 (WHP).
On August 5, 2004, plaintiffs filed a complaint alleging that
certain of the Company's business practices violate duties owed
to the class members including fiduciary duties, breach of
covenant of good faith and fair dealing, deceptive trade
practices, breach of contract, and unjust enrichment. The
complaint purports to be a class action filed on behalf of all
non-Employee Retirement Income Security Act (ERISA) health plans
with members who are employees of the City of New York and the
members of those plans. Plaintiffs request unspecified
compensatory and punitive damages, equitable relief and
attorney's fees.
EXPRESS SCRIPTS: Shareholders Launch Stock Lawsuits in E.D. MO
--------------------------------------------------------------
Express Scripts, Inc. faces several shareholder fraud class
actions filed against it and certain of its officers in the
United States District Court for the Eastern District of
Missouri, styled:
(1) Sylvia Childress, et al v. Express Scripts, Inc., et
al., Cause No. 04-CV-01191,
(2) Lidia Garcia, et al v. Express Scripts, Inc., et al.,
Cause No. 04-CV-1009,
(3) Robert Espriel, et al v. Express Scripts, Inc., et al,
Cause No. 04-CV-01084,
(4) Raymond Hoffman, et al v. Express Scripts, Inc., et al,
Cause No. 04-CV-01054,
(5) John R. Nicholas, et al v. Express Scripts, Inc., et
al, Cause No. 04-CV-1295,
(6) John Keith Tully, et al v. Express Scripts, Inc., et
al, Cause No. 04-CV-01338,
All of these suits allege violations of federal securities law.
The complaints allege that the Company failed to disclose
certain alleged improper business practices and issued false and
misleading financial statements. The complaints allege that they
are brought on behalf of purchasers of Company stock during the
period October 29, 2003 to August 3, 2004. The complaints
request unspecified compensatory damages, equitable relief and
attorney's fees. Three of these cases have been consolidated.
EXPRESS SCRIPTS: Seeks Transfer of ERISA Fraud Suit To E.D. MO
--------------------------------------------------------------
Express Scripts, Inc. is seeking the transfer of the class
action filed against it and its subsidiary National Prescription
Administrators (NPA), styled "United Food and Commercial Workers
Unions and Employers Midwest Health Benefits Fund, et al v.
National Prescription Administrators, Inc., et al, Cause No. 04-
CV-7472, from the United States District Court for the Southern
District of New York to the United States District Court for the
Eastern District of Missouri.
The complaint alleges that certain of the Company's business
practices violate duties to the class members including duties
under the Employee Retirement Income Security Act (ERISA), state
common law and state consumer protection statutes. The complaint
purports to be a class action filed on behalf of all current
former self-funded ERISA and non-ERISA funds for which the
Company or NPA served as the pharmacy benefit manager (PBM).
Plaintiffs request unspecified compensatory damages, equitable
relief and attorney's fees. The Company has also filed a motion
to dismiss some of the claims.
FLORIDA: Gov. Jeb Bush Proposes Changes To Curb Lawsuit Abuse
-------------------------------------------------------------
Proclaiming that protecting companies from abusive use of the
courts would give the state a better business climate, Gov. Jeb
Bush has proposed a series of changes to the rules governing
lawsuits, the Associated Press reports.
A few months back, Gov. Bush had said that one of his top
priorities this year is legislation that would give businesses
protection from some types of lawsuit liability, which is a
major push for his Republican Party nationwide. "This is a
threat to the growth of our state. There are many things about
Florida that draw many businesses here, this is a deterrent,"
Gov. Bush declares.
However, opponents of the measures contended that they would
simply help businesses get away with wrongdoing by escaping
multimillion-dollar judgments and the idea that the state is
rife with runaway verdicts for frivolous cases is a big
exaggeration.
Gov. Bush's proposals include one that would insulate retailers
from liability for defective products they sell and another
would immunize the owners of cars from liability when someone
else is driving them and gets in an accident. The Florida
governor is also backing legislation (SB 2564) that deals with
class-action lawsuits filed in Florida, in essence limiting
plaintiffs in most cases to only Florida residents. Another
proposal the governor is backing is one that would immunize
property owners from liability for criminal acts on their
property when the property owner has nothing to do with it.
Additionally, he also wants to end the ability of plaintiffs to
collect damages from defendants who are only partly at fault.
Proponents of the changes say victims of wrongdoing sometimes
sue defendants who had little to do with the wrongdoing, but
have lots of money.
According to Gov. Bush, Florida's economy has created jobs in
recent years, but the outlook would be even better if it were
more difficult to win damages that often aren't warranted. "We
do lead the nation in job growth and I want to keep it that
way," he told AP.
Still, opponents led by consumer groups and lawyers who
represent plaintiffs in lawsuits contend that Gov. Bush is
playing to a myth in the public mind, perpetuated by a few rare
cases in which people seemed to have received ridiculous awards.
Those aren't the norm, opponents say and in some instances
frivolous cases are thrown out.
"We hear the anecdotes, we'd like to see the facts," Scott
Carruthers, executive director of the Academy of Florida Trial
Lawyers, told AP. "They want to put all the onus on the injured
victim," Alexander Clem, a lawyer who represents injured victims
in Orlando, told AP.
In Florida, the governor's desire to see lawsuit restraints will
meet with a compliant, GOP-dominated Legislature. House Speaker
Allan Bense, R-Panama City, and Senate President Tom Lee, R-
Brandon joined the governor, at a rally announcing the
proposals.
HANS KISSLE: Recalls Tuna Fish Salad For Listeria Contamination
---------------------------------------------------------------
Hans Kissle is conducting a voluntary recall of all prepared
tuna fish salad sold in the retail deli section because it has
the potential to be contaminated with Listeria monocytogenes, an
organism which can cause serious and sometimes fatal infections
in young children, frail or elderly people, and others with
weakened immune systems. Although healthy individuals may suffer
only short-term symptoms such as high fever, severe headache,
stiffness, nausea, abdominal pain and diarrhea, Listeria
infection can cause miscarriages and stillbirths among pregnant
women.
Hans Kissle tuna fish salad is available for purchase in the
deli section of select supermarkets under the Hans Kissle,
Shaw's, Stop & Shop and Block & Barrel label. The product
subject to recall is tuna salad in five lb. and 8 oz. containers
with sell-by dates between March 15th and March 31th, 2005.
"As part of our continuous quality control checking system at
all levels of manufacturing and distribution, possible
contamination with Listeria monocytogenes was identified",
states Steve Zenlea, president of Hans Kissle. "As a rapid
response to this finding, we have immediately and voluntarily
recalled all tuna fish salad from the marketplace in Mass, Rhode
Island, New Hampshire, Vermont, New York and New Jersey.
No illnesses have been reported related to this voluntary
recall. If any of this tuna fish salad remains at home,
consumers should return the product to these stores for a full
refund.
Hans Kissle and all affiliated retailers apologize for any
inconvenience, and remain committed to constantly monitor the
quality of all food products to assure the safety and
satisfaction of all customers. For additional information,
please call Hans Kissle at 978-556-3100 ext.248.
Hans Kissle manufactures a wide variety of premium salads and
foods under their own name and private label. No other Hans
Kissle products are affected nor have they been involved in this
recall.
JANUS CAPITAL: Faces Suits For Mutual Fund Trading Malpractice
--------------------------------------------------------------
Denver-based Janus Capital Group Inc. reports that it might be
hurt financially by 60 lawsuits filed against it that stems from
last year's investigations into trading irregularities of its
mutual funds, the Associated Press reports.
The troubled fund giant disclosed in a recent 10-Q filing with
the Securities and Exchange Commission that the lawsuits were
filed in various state and federal courts, but have been
recently consolidated into five complaints seeking class-action
status. Last year, Janus spent $325 million to settle government
and regulatory charges it was involved in market-timing trades.
According to Janus' SEC filing, "the outcome of civil lawsuits
brought against (it) may have a material adverse effect on the
business, financial condition, and results of operations.
Although there can be no assurances, at this time management
believes - based on information currently available - that it is
not probable the ultimate outcome of each of the actions will
have a material adverse effect on the consolidated financial
condition of the Company," Janus further said in the filing,
"although they might be material to the operating results for a
particular period depending, in part, upon operating results for
that period."
In a report to clients, Merrill Lynch analyst Guy Moszkowski
said that he found the phrasing used by Janus in its report to
be a bit more than the usual language seen in reports to the
SEC. He points out that many companies use such reports as a
forum to disclose risks, operational or legal that might impact
business in coming quarters. He told AP, "Janus' 10-Q report
contained slightly more than the usual boilerplate language
involving legal risk. Some of its litigation costs may be
recoverable from insurance, as noted in the 10-Q, but Janus
(said) it 'is unable to assess any possible insurance
reimbursement at this time.'"
Janus was the target of investigations by New York Attorney
General Eliot Spitzer and Colorado Attorney General Ken Salazar,
for which it paid $225 million last April to settle. The firm
also paid $100 million to settle a similar probe launched by the
SEC last August.
LABORATORY CORPORATION: NC Court Mulls Dismissal of Stock Suit
--------------------------------------------------------------
The United States District Court for the Middle District of
North Carolina has yet to rule on Laboratory Corporation of
America's motion to dismiss the consolidated securities class
action filed against it and certain of its executive officers,
alleging securities fraud.
The suit, filed under Judge James Beatty, alleges that the
defendants violated the federal securities laws by making
material misstatements and/or omissions that caused the price of
the Company's stock to be artificially inflated between February
13 and October 3, 2002. The plaintiffs seek certification of a
class of substantially all persons who purchased shares of the
Company's stock during that time period and unspecified monetary
damages.
MISSISSIPPI: Judge Grants Certification To Foster Care Lawsuit
--------------------------------------------------------------
U.S. District Court Judge Tom S. Lee has ruled that attorneys
for abused and neglected foster care children in Mississippi
have met the criteria for a class-action suit against the state
Department of Human Services, The Clarion-Ledger reports. In
his ruling, the federal judge noted that the "plaintiffs have
identified alleged shortcomings by DHS in terms ... of its
staffing, policies and practices, which if proven, could readily
be found to place every child in DHS custody at substantial risk
of harm."
The lawsuit, which represents one side of a legal argument, says
that the state has failed to protect the children who depend on
DHS and the Division of Family and Children's Services for
fundamental needs, and has failed to provide the support
necessary for their care.
Stephen Leech, the Jackson attorney for the children, said a win
in the case could bring about substantial reforms. He told the
Clarion-Ledger, "It means the court will determine the
violations of constitutional rights, then will determine the
remedies for those constitutional rights of all the children who
are in the custody of the Department of Human Services." He also
points out that a remedy could include training caseworkers or
increasing their numbers.
Betty Mallett of McGlinchey Stafford PLLC, which is representing
the defendants, explained in a statement that cases against
state child welfare agencies are typically handled as class-
action suits. She told the Clarion-Ledger though that
Mississippi is no different from other states struggling with a
burgeoning child welfare system in tight budget times. She adds,
"The class action will make this case more expensive and
difficult to try, and we believe the money is better spent when
it is used to support our children instead of using it for
litigation."
NORTH CAROLINA: AG Warns Tobacco Program Participants V. Fraud
--------------------------------------------------------------
North Carolina Attorney General Roy Cooper encouraged farmers
participating in the Tobacco Transition Payment Program run by
the U.S. Department of Agriculture to keep an eye out for
scammers seeking to make an unfair profit as the buyout begins.
"The buyout is a much-needed opportunity for North Carolina
families that depend on tobacco," said Attorney General Cooper.
"Unfortunately, fraud artists will see it as an opportunity to
entice farmers into shaky loans, risky investments or payment
schemes."
The sign-up period for the program began on March 14,2005, at
local Farm Service Agency offices across North Carolina.
Tobacco growers and quota holders have until June 17 of this
year to sign up for the buyout program.
The program is structured so that participants will receive
annual payments for 10 years. Buyout participants who want to
receive the funds in one lump sum can sign over their payments
to a financial institution in return for an up-front payment.
However, the financial institution will discount that one-time
payment by a certain percentage, meaning that farmers who choose
a lump-sum payment will receive less than the total amount they
would get through ten year's worth of payments under the buyout
program. Growers and quota holders who are interested in
getting a lump-sum payment should compare discount rates from
several financial institutions to find the best rate.
Other growers and quota owners may choose to take out a loan
against their annual payments. As with all loans, consumers
should shop around to get the best terms. Interest rates and
fees tend to vary widely among lenders. Consumers should be
wary of loans offered through door-to-door sales or
telemarketers, and they should always read the entire loan
application carefully and make sure they understand it before
signing. Also, watch out for hidden terms such as prepayment
penalties, extra cash if the debt is paid early, and balloon
payments, a sudden increase in payments one month.
Tobacco growers and quota owners who have questions about
getting a fair loan or steering clear of scams can contact Mr.
Cooper's Consumer Protection Division toll-free at 1-877-5-NO-
SCAM.
Buyout participants who opt for a lump-sum payment or loan may
also attract the interest of those pitching investment offers,
the Attorney General warned. "If a deal sounds too-good-to-be-
true, it almost certainly is. Don't fall victim to high-
pressure sales pitches. Make sure the Company is registered to
sell securities. To check up on an investment opportunity,
contact the N.C. Secretary of State's office at 1-800-688-4507.
It is also wise to consult a lawyer, accountant, or financial
advisor before making an investment or taking out a loan," he
added in a statement.
"Tobacco has sustained families and communities across our state
for generations," said Attorney General Cooper. "I want North
Carolinians who are participating in the buyout to get their
money's worth, not get taken by scammers."
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.
NUVEEN INVESTMENTS: Shareholders Launch Stock Fraud Suits in IL
---------------------------------------------------------------
Nuveen Investments, Inc. faces a shareholder class action filed
in the United States District Court in the Northern District of
Illinois, styled "James Jacobs et al v Nuveen Investments, Inc.
et al., No. 05 C 0143." An individual purporting to be a
shareholder of one open-end fund sponsored by Nuveen filed the
suit, which also names as defendants:
(1) Nuveen Institutional Advisory Corp. (merged into NAM
as of January 1,2005)
(2) NWQ Investment Management Company, LLC,
(3) Rittenhouse Asset Management, Inc.,
(4) Institutional Capital Corporation, and
(5) the individual Nuveen fund directors, including
Nuveen's Chairman and Chief Executive Officer Timothy
R. Schwertfeger
Purporting to sue on behalf of investors in all Nuveen-sponsored
open-end mutual funds with equity holdings, the plaintiff has
alleged that the defendants breached common law fiduciary
duties, duties of care and Sections 36(a), 36(b) and 47(b) of
the Investment Company Act of 1940 by failing to ensure that the
open-end funds participated in securities class action
settlements for which those funds were eligible. The complaint
contains no specific allegations that the Nuveen funds failed to
participate in particular settlements but lists 136 settlements
during the period from January 10,2000 through January 10,2005
and alleges that the funds failed to submit claims in some of
those proceedings. The plaintiff has claimed as damages
disgorgement of fees paid to the investment advisers,
compensatory damages, punitive damages, attorney's fees, and
other unspecified relief.
On February 4, 2005, the defendants filed a Motion for an
Extension of Time to Answer or Otherwise Respond to Plaintiff's
Complaint which motion was granted. Since the lawsuit was
recently filed and the Company's equity funds include funds
managed by sub-advisers, Nuveen is still in the process of
reviewing the facts related to the claims stated in the lawsuit.
The suit is styled "Jacobs v. Bremner, et al, case no. 1:05-cv-
00143," filed in the United States District Court for the
Northern District of Illinois, under Judge Milton I. Shadur.
Representing the plaintiffs are:
(1) Hank Bates and J. Allen Carney, Cauley Bowman Carney &
Williams, LLP, 11311 Arcade Drive, Suite 200, Little
Rock, AR 72212, Phone: (501) 312-8500
(2) Marvin Alan Miller, Jennifer Winter Sprengel and
Matthew Eric Van Tine, Miller Faucher and Cafferty,
LLP, 30 North LaSalle Street, Suite 3200 Chicago, IL
60602, Phone: (312) 782-4880
(3) Randall K Pulliam, Baron & Budd, P.C., 3102 Oak Lawn
Avenue, Suite 1100, Dallas, TX 75219, Phone: (214) 521-
3605
Representing the Company are James Kevin McCall and James L.
Thompson of Jenner & Block, LLC, One IBM Plaza, 330 North Wabash
Avenue, 40th Floor, Chicago, IL 60611, Phone: (312)222-9350
OWENS CORNING: Judge Dismisses Shareholder Suit, Cites Statutes
---------------------------------------------------------------
A federal judge in Toledo has dismissed a two-year-old
securities-fraud lawsuit that was filed by a group of
shareholders against current and former officials of Owens
Corning, the Toledo Blade reports.
According to Judge David Katz's written ruling, the suit, which
had sought class-action status and was instigated by national
law firms that specialize in securities litigation, is barred by
the statute of limitations. He specifically wrote, ". Their
lawsuit, filed in January 2003, is time-barred."
The lawsuit had alleged that retired Chief Executive Officer
Glen Hiner and others hid Owens Cornings' poor financial
condition from investors in the months leading up to the firm's
bankruptcy filing in October 2000. The suit was one of three
filed across the United States against Mr. Hiner and certain
other executives and board members.
Neither New York attorney Ira Press nor Cleveland attorney
Timothy Fitzgerald, who represented the plaintiffs returned
calls seeking comment. Chicago lawyer Chad Pekron, who defended
Mr. Hiner and the others, also couldn't be reached, the Toledo
Blade reports.
In federal court in Boston, a four-year-old lawsuit filed by
bondholders who contend that they were misled is pending. And in
state court in the New York, a similar action by firms holding
Owens Cornings' bank debt has been put on hold by the Delaware
judge overseeing the bankruptcy case.
Owens Cornings, a building product manufacturer that is Toledo's
third-largest corporation, is not named in the suits. It
continues to operate under Chapter 11 protection, which shields
firms from litigation. Under it's proposed bankruptcy exit plan,
stock will be voided.
Judge Katz, of U.S. District Court in Toledo, didn't address the
substance of the allegations but rather accepted defense
arguments that the plaintiffs waited too long to file suit. In
the early March ruling, Judge Katz said shareholders had one
year from the discovery of the alleged fraud, or until late
2001, to file suit. Passage of the Sarbanes-Oxley bill extended
the time to two years, but in waiting until 2003, the action was
too late, he said.
In written arguments, plaintiffs tried to get around the issue
of the statute of limitations by saying that they didn't learn
of the alleged fraud until evidence was produced much later in
Owens Cornings' bankruptcy case. Judge Katz said, however
pointed out that there were plenty of "storm warnings" in 2000,
and the plaintiffs had a duty under the law to begin their own
investigation at that time. He also said that they presented no
evidence indicating that they did so.
Besides Mr. Hiner, defendants included current Chairman Michael
Thaman, who is also Owens Cornings' chief financial officer, J.
Thurston Roach, former CFO, Deyonne Epperson, comptroller,
Landon Hilliard, a director and Maura Abeln Smith, former legal
chief.
TADIAN HOMES: Homeowners Lodge Suit Over Construction Practices
---------------------------------------------------------------
Forty homeowners in the Ashford of Clarkston subdivision have
initiated a lawsuit against Troy's Tadian Homes and its
Illinois-based parent Company alleging substandard construction
practices in the 53-home community, The Daily Oakland Press
reports,
Filed in Oakland County Circuit Court, the suit names Tadian,
Warrenville, Illinois-based Neumann Homes, window supplier MW
Manufacturers Inc., and two Neumann and Tadian subsidiaries.
Neumann had acquired Tadian, which was founded in metro Detroit
20-plus years ago, in January. The subdivision in question was
been built by Tadian, on Sashabaw Road south of Oak Hill Road,
in the late 1990s and early 2000s.
The Ashford homeowners, who bought homes ranging from 2,600
square feet to 3,100 square feet for $270,000-plus, allege a
host of construction defects including improperly installed
windows, mold buildup, defective furnaces, substandard floors
and improper grading that led to leaks. Additionally they have
alleged that Tadian ignored homeowner complaints and tried to
cover up defects listed in an internal Company report.
Mark Rossman, an attorney with Mantese & Associates, the Troy
law firm that filed the suit on behalf of the Ashford
homeowners, told the Daily Press "They put their trust in Tadian
and now they feel betrayed. Tadian Homes has done nothing to
remedy these problems. Tadian has essentially turned their backs
on them." Mr. Rossman is seeking class-action status, claiming
similar defects at two other Tadian subdivisions namely the
Woods of Orchard Square in Sterling Heights and Glenwood Park in
Troy.
Dennis Bailey, division manager for Tadian, told the Daily Press
he is unaware of any homeowner complaints in Orchard Square or
Glenwood. He did however acknowledge that Ashford had an unusual
number of problems, which were mostly connected to faulty
windows, which he believes the Company has addressed. In
reference to the allegation Tadian ignored complaints, Mr Bailey
goes on to say, "What the attorney is alleging is absolutely
false. We have spent an inordinate amount of time working on
issues in that community over the last four years." He also
points out that Tadian representatives were on-site at Ashford
up to two years past the time the builder's warranty on the
homes expired.
In the suit though, Mr. Rossman refers extensively to a report
from a former Tadian employee detailing defects at various
Tadian communities. The employee, who shared the report with the
Ashford homeowners, was fired, Mr. Rossman pointed out. Mr.
Bailey countered that the warranty service worker resigned after
working for Tadian for a short time, under circumstances not
connected to the report.
In the lawsuit, Mr. Rossman alleges breach of contract, fraud,
violations of the Michigan Consumer Protection Act and several
other violations of the law. Thus, according to him, he will
seek relief "in the millions of dollars" for his clients. A
trial on the matter likely wouldn't take place until some time
next year, Mr. Rossman estimated.
TENNESSEE: Both Parties Ordered To Split Costs in Crematory Case
----------------------------------------------------------------
Hamilton County Circuit Court Judge Neil Thomas has ruled that
court costs totaling $7,000 in a class action lawsuit against a
Georgia crematory operator and funeral homes will be split
between the defendants and the plaintiffs, the Associated Press
reports.
Plaintiffs will pay about $90 each while defendants, including
Tri-State Crematory operator Brent Marsh and his family and 26
funeral homes, will each pay about $120, according to Judge
Thomas. The judge's ruling affects all the Tennessee cases that
were dismissed after the plaintiffs agreed to join with the
federal class-action lawsuit in Georgia against Mr. Marsh and
the funeral homes.
Earlier this year, Mr. Marsh was sentenced to 12 years in prison
earlier on criminal charges in Georgia and Tennessee that he had
dumped 334 bodies sent to him for cremation and passed off dirt
and cement dust as the remains. Specifically, his sentence
included up to 12 years in prison, lengthy probation and a
$20,000 fine.
Stuart James, who represents the Marshes in the civil cases, had
argued that plaintiffs should pay all costs because they agreed
to join the cases in Georgia.
The Georgia lawsuit was settled last year with funeral homes
agreeing to pay about $36 million and the lawyers for the Marsh
family negotiating an $80 million payment from the crematory's
insurance Company. However, Walker County court records reveal
that insurer Farm Bureau is denying the claim. According to
Officials, Farm Bureau has only agreed to pay $3.1 million for
Mr. Marsh's lawyers and to set aside $400,000 in a trust fund
for his mother, AP reports.
TEXAS: AG Abbott Warns Firms Of Consumer Info Security Threats
--------------------------------------------------------------
Texas Attorney General Greg Abbott sent an urgent message to all
Texas businesses that manage databases with sensitive personal
information on citizens to immediately undertake measures to
ensure the security of the data.
"Recent events in California, New York and elsewhere involving
ChoicePoint, DSW Shoe Warehouse, LexisNexis and other companies
that store sensitive data show an alarming breakdown of security
that has compromised consumers' sensitive personal information,"
said Attorney General Abbott. "Names, Social Security numbers,
driver's license numbers and financial information of hundreds
of thousands of consumers, many in Texas, may have been
compromised or even unleashed to identity thieves. This trend
must be halted now and the perpetrators brought to justice."
Attorney General Abbott has sent letters to LexisNexis and DSW
to underscore his concerns about private consumer information
falling into the hands of criminals who could exploit the
information and cause widespread ruin of personal finances of
Texans. The Attorney General also has been in communication with
ChoicePoint and California law enforcement officials concerning
Texas consumers who were possibly affected by that Company's
security breach this year.
In the letters, Attorney General Abbott asks the companies to
provide his office information about the number of Texans
possibly affected by these breaches and a description of the
information illegally obtained. Attorney General Abbott stressed
the need to fast-track the information gathering process and to
notify consumers at the earliest possible opportunity.
The Attorney General's Office is currently working with
authorities in other states and with the U.S. Federal Trade
Commission and U.S. Secret Service to strengthen efforts of
these companies to protect sensitive information and avoid
serious breaches in the future. The Texas Legislature is also
considering new bills to address this problem.
Texas businesses that have reason to believe their consumer
databases may have been jeopardized should immediately contact
the Attorney General's Office with details about the types of
information possibly compromised. The toll-free number is
(800) 252-8011.
UNITED RETAIL: Former Employees Launch Overtime Wage Suit in CA
---------------------------------------------------------------
United Retail Incorporated faces an overtime wage suit filed in
California Superior Court, Los Angeles County, styled "Erik
Stanford vs. United Retail Incorporated." A former store
manager in California filed the suit on behalf of certain
current and former associates in California in the previous four
years. The suit asserts state wage and hour claims.
The Company intends to fight class certification and, if
necessary, the case at trial, it said in a disclosure to the
Securities and Exchange Commission.
UNITED STATES: Arbitration Service Reverses Class Action Policy
---------------------------------------------------------------
After months of complaints from general counsel and defense
attorneys, the alternative dispute resolution (ADR) provider
JAMS has reversed its policy of refusing to enforce contract
clauses that prohibit consumer and employee class actions, The
Recorder reports.
According to JAMS GC John "Jay" Welsh, the arbitration firm
still thinks that the clauses may be unfair to workers and
consumers. But, nevertheless, the service changed its policy to
counter the perception of outside lawyers that JAMS, which had
been the only ADR provider to refuse to enforce exclusion
clauses, was favoring the plaintiff bar. Mr. Welsh explained
its recent decision by saying, "People on each side of the aisle
were misrepresenting our position. Plaintiffs interpreted it in
a way that was beneficial to them, and defense attorneys
interpreted it in a way that was detrimental," The Recorder
reports.
At least one large client, Citibank, wrote JAMS out of its
contracts in response to the policy, Mr. Welsh confirmed. While
another client, Discover Card also wrote out JAMS, according to
the ADR Institute, which is sponsored by the National
Arbitration Forum.
Though both plaintiff and defense attorneys said they knew other
companies that had dropped JAMS they refused to give names. Eric
Tuchmann, general counsel for the American Arbitration
Association (AAA), the country's biggest ADR provider, said
though that he wasn't sure whether his Company had picked up any
clients as a result of JAMS' policy.
Mr. Welsh insisted that image and not lost business was the
reason for changing the policy. A day after the JAMS board voted
unanimously to overturn a rule that, in November, it had
unanimously approved, Mr. Welsh said, "This was not a business
issue. People were misinterpreting the policy and
misinterpreting it to the detriment of our mission of
neutrality."
The decision, however, infuriated plaintiff attorneys who had
earlier applauded the JAMS policy. According to Cliff Palefsky,
a partner with McGuinn, Hillsman & Palefsky in San Francisco and
a longtime opponent of mandatory ADR, "If you're not capable of
withstanding the pressure and doing what you think is right, you
shouldn't be doing arbitrations." He adds that JAMS and other
arbitrators violate their standards of giving people the same
rights they would have in court when they honor class action
preclusion clauses.
F. Paul Bland Jr., an attorney with Trial Lawyers for Public
Justice in Washington, D.C., agreed and pointed out, "They've
knuckled under to financial pressure." He also adds that the
arbitration service had been swayed by a fierce campaign by
defense lawyers and general counsel, The Recorder reports.
Another attorney, Alan Kaplinsky, Philadelphia-based partner
with the defense firm Ballard Spahr Andrews & Ingersoll, who was
one of the lawyers who most vigorously fought the JAMS policy,
also said that the policy change was a response to defense bar
criticism. He told the Recorder, "I have been speaking very
publicly about it, and I have been writing about it. I have been
very, very critical of the policy, and I think some other
lawyers who have been critical of the issue have been talking
about it, and I think JAMS has taken that criticism to heart."
In addition to public griping, Mr. Kaplinsky adds that JAMS was
also pressured by corporate clients' decision to use arbitration
services that would honor class action preclusions. "I do have
clients who have written JAMS out of their contracts," said Mr.
Kaplinsky, who declined to name them.
Mr. Bland also said he was surprised by the policy change, even
though he heard Mr. Kaplinsky at a conference last week say he
thought JAMS was close to reversing its stance. He adds, "I
thought Alan was blowing smoke. I was pretty disappointed."
Class action arbitrations are a relatively new issue and have
only received substantial debate over the past two years. "The
whole idea of a class action arbitration was pretty foreign,"
said Mr. Tuchmann. However, according to the AAA general counsel
that all changed with a 2003 U.S. Supreme Court decision, Green
Tree Financial v Bazzle, 539 U.S. 444, which gave arbitrators
authority to decide whether class actions were allowed under
particular contracts. Since then, the debate over exclusion
clauses has been "very difficult and very divisive," Mr.
Tuchmann points out.
Lawyers on all sides of the arbitration debate say that more
definitive court rulings are needed to address whether it's
legal for a contract to rule out class actions. Until that
debate is resolved, JAMS will allow such clauses in
jurisdictions where they're legal.
New Securities Fraud Cases
CELL THERAPEUTICS: Chitwood & Harley Files Securities Suit in WA
----------------------------------------------------------------
The law firm of Chitwood & Harley LLP initiated a securities
fraud class action complaint in the United States District Court
for the Western District of Washington against Cell
Therapeutics, Inc. ("CTIC" or the "Company") (NASDAQ: CTIC), Max
Link and James A. Bianco on behalf of purchasers of CTIC
securities during the period between June 7, 2004 and March 4,
2005 (the "Class Period").
The complaint charges Cell Therapeutics, Inc., Max Link, and
James Bianco 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, known to defendants or recklessly disregarded by
them:
(1) that contrary to the defendant's express and repeated
representations the results of STELLAR 3 trial were not
encouraging;
(2) that XYOTAX failed to boost survival for non-small cell
lung cancer;
(3) that XYOTAX failed to show greater survival benefit
than Taxol, the leading drug on the market; and
(4) that based on the results of the trial the Company
would not be able to begin pre-launch activities and to
position itself to submit a new drug application for
XYOTAX.
On March 7, 2005, prior to the opening of the market, CTIC
announced that a phase III study of XYOTAX in combination with
carboplatin, known as STELLAR 3, missed its primary endpoint.
News of this shocked the market. Shares fell $4.75 per share or
47.5 percent, on March 7, 2005, to close at $5.25 per share, on
unusually high volume.
For more details, contact Nichole Browning Adams, Esq. of
Chitwood & Harley by visiting their Web site:
http://www.classlaw.com.
ECHOSTAR COMMUNICATIONS: Marc S. Henzel Files CO Securities Suit
----------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit was filed in the United States District Court for the
District Court of Colorado against EchoStar Communications
Corporation (NASDAQ: DISH), Charles W. Ergen, David Rayner,
Michael R. McConnell, Paul W. Orban and David Moskowitz on
behalf of purchasers of DISH securities during the period
between August 10, 2004 and March 9, 2005 (the "Class Period").
The complaint charges that defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of materially false
and misleading statements to the market concerning EchoStar's
results of operation. More specifically, the Complaint alleges
that the Company's Class Period financial statements and
disclosures were materially false and misleading and in
violation of Generally Accepted Accounting Principles ("GAAP")
because, among other things the Company lacked internal controls
adequate to ensure that the information contained in the
Company's financial reports fairly presented in all material
respects, the financial condition and results of operations of
the Company and the Company improperly booked certain
transactions with vendors and engaged in improper accounting.
The truth began to emerge on March 10, 2005 when the market
learned that EchoStar's audit committee had launched an internal
accounting probe and that the Company and Defendant Ergen were
the subjects of an SEC inquiry. According to a March 10, 2005
Reuters article, the probe relates to the booking of
transactions with suppliers and consulting payments to a friend
of Defendant Ergen, the Company's Chief Executive Officer.
Bloomberg reported that the probe by EchoStar's audit committee
was prompted by KPMG's audit of the Company and that the SEC
inquiry concerns Defendant Ergen's role in to the Company's
accounting. Bloomberg cited unnamed sources familiar with the
internal investigation who claimed that the investigation had
uncovered "evidence," including "Company records that showed
Ergen may have directed or authorized vendor transactions and
consulting payments to an unidentified friend." The Bloomberg
article also noted that since July 2004, the SEC has been
examining the way EchoStar and other companies in the
telecommunications industry account for subscribers. During the
Class Period, several of the Individual Defendants and other
officers and/or directors of EchoStar engaged in massive insider
trading, which Ft.com reported last night regulators are
probing.
Following the March 10, 2005 disclosure, the market price of
EchoStar's common stock dropped from a high of $34.38 per share
during the Class Period to as low as $28.20 per share on March
10, 2005, the lowest price at which EchoStar has traded since
August 2004. Trading in EchoStar common stock on March 10, 2005
exceeded 15 million shares, which is nearly eight times the
average daily trading volume for DISH common stock for the
previous three months of 1.876 million shares.
For more details, contact the Law Offices of Marc S. Henzel by
Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by
Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by
E-Mail: mhenzel182@aol.com.
ELAN CORPORATION: Marc S. Henzel Lodges MA Securities Fraud Suit
----------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit was filed in the United States District Court for the
District of Massachusetts a class action on behalf of purchasers
of Elan Corp., plc (NYSE: ELN) securities during the period
between February 18, 2004 and February 25, 2005 (the ``Class
Period'').
The complaint charges Elan and certain of its officers with
violations of the Securities Exchange Act of 1934. Elan is
engaged in the development and commercialization of TYSABRI, a
vaccine designed to treat patients with multiple sclerosis (MS),
slowing the progression of the disease and reducing incidents of
relapses. Throughout the Class Period, defendants caused Elan to
make a number of positive statements about the status of its
clinical trials and the commercial potential of TYSABRI, causing
Elan's stock to trade at artificially inflated prices. The
Complaint alleges that Elan violated federal securities laws by
issuing false or misleading information. Specifically,
defendants failed to disclose and misrepresented these material
adverse facts:
(1) that TYSABRI(r) (natalizumab), a monoclonal antibody
for the treatment of Multiple Sclerosis (``MS''), posed
serious immune-system side effects;
(2) that TYSABRI, like other MS drugs, made patients
susceptible to progressive multifocal
leukoencephalopathy (``PML'') by changing the way
certain white blood cells function, thereby allowing
PML, a normally dormant virus, to run rampant within
the human body;
(3) that defendants knew and/or recklessly disregarded
documented facts that MS drugs can cause greater
incidents of PML to occur; and
(4) that defendants concealed these facts in order to fast
track TYSABRI for FDA approval so that they could reap
the financial benefits from the sales of the drug.
On February 28, 2005, Elan shocked the market by reporting that
they were withdrawing TYSABRI from the market following reports
of patients contracting PML, with at least one instance
resulting in death. The announcement caused Elan's shares to
plummet, declining over 70% to approximately $8 per share on
February 28, 2005.
For more details, contact the Law Offices of Marc S. Henzel by
Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by
Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by
E-Mail: mhenzel182@aol.com.
ELAN CORPORATION: Stull Stull Lodges Securities Fraud Suit in NY
----------------------------------------------------------------
The law firm of Stull, Stull & Brody initiated a class action
lawsuit in the United States District Court for the Southern
District of New York, against Elan Corporation, PLC ("Elan" or
the "Company") (NYSE:ELN) on behalf of purchasers of Elan
securities between February 18, 2004 and February 25, 2005,
inclusive (the "Class Period").
The complaint charges Elan and certain of its officers and
directors with violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and SEC Rule 10b-5 promulgated
thereunder. Elan is engaged in the development and
commercialization of TYSABRI, a vaccine designed to treat
patients with multiple sclerosis (MS), slowing the progression
of the disease and reducing incidents of relapses. Throughout
the Class Period, defendants caused Elan to make a number of
positive statements about the status of its clinical trials and
the commercial potential of TYSABRI, causing Elan's stock to
trade at artificially inflated prices. The Complaint alleges
that Elan violated federal securities laws by issuing false or
misleading information. Specifically, defendants failed to
disclose and misrepresented the following material adverse
facts:
(1) that TYSABRI(r) (natalizumab), a monoclonal antibody
for the treatment of Multiple Sclerosis ("MS"), posed
serious immune-system side effects;
(2) that TYSABRI, like other MS drugs, made patients
susceptible to progressive multifocal
leukoencephalopathy ("PML") by changing the way
certain white blood cells function, thereby allowing
PML, a normally dormant virus, to run rampant within
the human body;
(3) that defendants knew and/or recklessly disregarded
documented facts that MS drugs can cause greater
incidents of PML to occur; and
(4) that defendants concealed these facts in order to fast
track TYSABRI for FDA approval so that they could reap
the financial benefits from the sales of the drug.
On February 28, 2005, Elan shocked the market by reporting that
they were withdrawing TYSABRI from the market following reports
of patients contracting PML, with at least one instance
resulting in death. The announcement caused Elan's shares to
plummet, declining over 70% to approximately $8 per share on
February 28, 2005.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody by Phone: 1-800-337-4983 by Fax: 212/490-2022 by E-mail:
SSBNY@aol.com or visit their Web site: http://www.ssbny.com.
FOREST LABORATORIES: 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 Southern
District of New York on behalf of purchasers of Forest
Laboratories, Inc. (NYSE: FRX) common stock during the period
between August 15, 2002 and September 1, 2004 (the "Class
Period").
The complaint charges Forest Labs and certain of its officers
and directors with violations of the Securities Exchange Act of
1934. Forest Labs develops, manufactures and sells prescription
drug products, as well as non-prescription pharmaceutical
products.
According to the complaint, during the Class Period, defendants
caused Forest Labs' stock price to be overstated by concealing
deficiencies with its Celexa/Lexapro drugs in treating
adolescent depression. When Forest Labs ultimately disclosed an
agreement with the New York State Attorney General to make
available summaries of previously undisclosed studies on the
drugs to the public, the price of Forest Labs stock dropped to
as low as $36 per share.
For more details, contact the Law Offices of Marc S. Henzel by
Mail: 273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by
Phone: 610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by
E-Mail: mhenzel182@aol.com.
SIPEX CORPORATION: Goldman Scarlato Sets Lead Plaintiff Deadline
----------------------------------------------------------------
The law firm of Goldman Scarlato & Karon, P.C., a law firm with
offices in Philadelphia, PA and Cleveland, OH, reminds investors
that the deadline for purchasers of Sipex Corporation ("Sipex"
or the "Company") (Nasdaq: SIPX) to move for Lead Plaintiff in
the securities fraud class action is rapidly approaching.
The lawsuit was filed against Sipex and Douglas M. McBurnie,
Walid Maghribi, Phillip A. Kagel and Clyde R. Wallin
("Defendants") in the United States District Court for the
Northern District of California on behalf of individuals who
purchased or otherwise acquired publicly traded securities of
Sipex between April 10, 2003 and January 20, 2005, inclusive,
(the "Class Period").
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 failed to disclose or misrepresented that the Company
inappropriately recognized revenue on sales for which price
protection, stock rotation and/or return rights were granted,
that the Company's financial results were in violation of
Generally Accepted Accounting Principles ("GAAP") and that the
Company lacked adequate internal controls.
On January 20, 2005 Sipex announced that the Company would
restate its financial results for the fiscal year ended December
31, 2003 and the fiscal quarters ended April 3, 2004, July 3,
2004 and October 2, 2004 due to the possible improper
recognition of revenue during these periods. Shares of Sipex
reacted negatively to the news, losing $0.90 per share, or 23.4%
on January 21, 2005.
For more details, contact Goldman Scarlato & Karon, P.C. by
Phone: +1-888-753-2796.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA. Glenn Ruel Senorin, Aurora Fatima Antonio and Lyndsey
Resnick, Editors.
Copyright 2005. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
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