/raid1/www/Hosts/bankrupt/CAR_Public/050419.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, April 19, 2005, Vol. 7, No. 76
Headlines
ACLARA BIOSCIENCES: NY Court Approves Securities Suit Settlement
ACTV INC.: Faces DE Shareholder Fraud Lawsuit V. OpenTV Merger
AETHER SYSTEMS: NY Court Preliminarily Approves Suit Settlement
ALLOS THERAPEUTICS: Asks CO Court To Dismiss Securities Lawsuit
AMERICAN HONDA: Recalls 1,923 Passenger Cars For Crash Hazard
ASIAINFO HOLDINGS: NY Court Preliminarily OKs Lawsuit Settlement
CAESAR'S PALACE: EEOC Initiates Complaint For Sexual Harassment
CALIFORNIA: AG Lockyer Files Complaint V. Illegal Spam Operation
CALIFORNIA: PRI Talks About Employment Bias Cases at SIOP Meet
CENTRA SOFTWARE: NY Court Preliminarily Approves Suit Settlement
CROMPTON CORPORATION: PA Court OKs Antitrust Lawsuit Settlement
CROMPTON CORPORATION: Forges Pact For CT, PA, CA Antitrust Suits
CROMPTON CORPORATION: Continues To Face Federal Antitrust Suits
CROMPTON CORPORATION: Faces State Chemical Antitrust Lawsuits
CROMPTON CORPORATION: Faces Two Multiple Product Antitrust Suits
CROMPTON CORPORATION: Canada Motion To File Lawsuits Suspended
CROMPTON CORPORATION: Canadians Commence EPDM Antitrust Lawsuit
CROMPTON CORPORATION: Faces EPDM Antitrust Suit in Ontario Court
CROMPTON CORPORATION: Faces Antitrust Lawsuit in Canadian Court
CROMPTON CORPORATION: Asks CT Court To Dismiss Securities Suit
DDI CORPORATION: Plaintiffs File Amended Securities Suit in CA
DYNEGY INC.: Settles Securities, Derivative Litigation in TX
ERPENBECK CO.: Subcontractors Receive Meager Settlement in KY
ESPEED INC.: Shareholders File Securities Fraud Suits in S.D. NY
FINDWHAT.COM: Consumers Commence Lawsuit V. Gambling Ads in CA
FINDWHAT.COM: Faces Suit For Electronic Privacy Act Violations
FLORIDA: Republicans Seeking Limits For Class Action Litigation
FORBES REGIONAL: Negligence Suit Lodged Over Colon Examinations
GENERAL MOTORS: Recalls 2,536 Sierra Denali SUVs For Injury Risk
GEORGIA: Police Officer Lodges $100M Reverse Discrimination Suit
HORIZON BLUE: Suit Filed Over Flawed Data Used To Set Low Rates
INTERSIL CORPORATION: NY Court Preliminarily Approves Settlement
MAGEE-WOMENS: PA Court Sides With Hospital in Pap Smear Lawsuit
MCCOWN DE LEEUW: Trustee Doubts Validity of Ex-Workers ID Suit
NEOFORMA INC.: NY Court Preliminarily Approves Suit Settlement
NETRATINGS INC.: NY Court Preliminarily Approves Suit Settlement
NEW JERSEY: Two Men Launch Suit Over Jail's Strip-Search Policy
OPENTV CORPORATION: NY Court Preliminarily OKs Suit Settlement
PEC SOLUTIONS: Plaintiffs Appeal VA Securities Lawsuit Dismissal
RAYTHEON COMPANY: Reaches $39M Settlement For ID Securities Suit
RENT-A-CENTER: AR Court Grants Firm's Motion To Dismiss Lawsuit
SINA CORPORATION: Shareholders Launch Stock Fraud Lawsuits in NY
STONEPATH GROUP: Faces Consolidated Securities Suit in E.D. PA
SUPPORTSOFT, INC.: Goodkind Labaton Appointed Co-Lead Counsel
SUPPORTSOFT INC.: NY Court Preliminarily OKs Lawsuit Settlement
TOYOTA MOTOR: Recalls Tundra Pick-up Trucks Due To Crash Hazard
WESTER ENERGY: Settles Securities, Derivative Lawsuits in KS
WINK COMMUNICATIONS: NY Court Preliminarily Approves Settlement
ZHONE TECHNOLOGIES: Asks NJ Court To Dismiss Securities Lawsuit
New Securities Fraud Cases
BLUE COAT: Lasky & Rifkind Lodges Securities Fraud Lawsuit in CA
GLAXOSMITHKLINE PLC: Schiffrin & Barroway Files Stock Suit in NY
IMERGENT INC.: Cohen Milstein Lodges Securities Fraud Suit in UT
KRISPY KREME: Keller Rohrback Launches ERISA Lawsuit in M.D. NC
MBIA INC.: Spector Roseman Lodges Securities Fraud Lawsuit in NY
XYBERNAUT CORPORATION: Shepherd Finkelman Files Stock Suit in DE
*********
ACLARA BIOSCIENCES: NY Court Approves Securities Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York preliminarily approved the settlement for the
consolidated securities class action filed against ACLARA
Biosciences, Inc. and certain of its former officers and
directors, (referred to together as the "ACLARA defendants"),
styled "In re ACLARA BioSciences, Inc. Initial Public Offering
Securities Litigation." The suit also names several of the
underwriters involved in the Company's initial public offering,
or IPO, as defendants.
This class action is brought on behalf of a purported class of
purchasers of ACLARA common stock from the time of ACLARA's
March 20, 2000 IPO through December 6, 2000. The central
allegation in this action is that the underwriters in the ACLARA
IPO solicited and received undisclosed commissions from, and
entered into undisclosed arrangements with, certain investors
who purchased ACLARA stock in the IPO and the after-market. The
complaint also alleges that the ACLARA defendants violated the
federal securities laws by failing to disclose in the IPO
prospectus that the underwriters had engaged in these allegedly
undisclosed arrangements.
More than 300 issuers who went public between 1998 and 2000 have
been named in similar lawsuits. In July 2002, an omnibus motion
to dismiss all complaints against issuers and individual
defendants affiliated with issuers (including ACLARA defendants)
was filed by the entire group of issuer defendants in these
similar actions. On February 19, 2003, the Court in this action
issued its decision on the defendants' omnibus motion to
dismiss. This decision dismissed the Section 10(b) claim as to
ACLARA but denied the motion to dismiss Section 11 claim as to
ACLARA and virtually all of the other defendants.
On June 26, 2003, the plaintiffs in the consolidated class
action lawsuits announced a proposed settlement with ACLARA and
the other issuer defendants. The proposed settlement, which was
approved by ACLARA's board of directors, provides that the
insurers of all settling issuers will guarantee that the
plaintiffs recover $1 billion from non-settling defendants,
including the investment banks who acted as underwriters in
those offerings. In the event that the plaintiffs do not
recover $1 billion, the insurers for the settling issuers will
make up the difference. Under the proposed settlement, the
maximum amount that could be charged to ACLARA's insurance
policy in the event that the plaintiffs recovered nothing from
the investment banks would be approximately $3.9 million.
The suit is styled "In re ACLARA Biosciences, Inc. Initial
Public Offering Sec. Litigation," related to "In re Initial
Public Offering Securities Litigation, Master File No. 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
ACTV INC.: Faces DE Shareholder Fraud Lawsuit V. OpenTV Merger
--------------------------------------------------------------
ACTV, Inc. continues to face a class action filed in the Court
of Chancery of the State of Delaware in and for New Castle
County, over its merger with OpenTV Corporation.
The suit was originally filed on November 18, 2002, and also
names as defendants certain of the Company's directors and
OpenTV Corporation. The complaint generally alleges that the
Company's directors breached their fiduciary duties to the
Company's shareholders in approving the ACTV merger agreement
pursuant to which OpenTV acquired ACTV on July 1, 2003, and
that, in approving the ACTV merger agreement, the Company's
directors failed to take steps to maximize the value of ACTV to
its shareholders. The complaint further alleges that the
Company aided and abetted the purported breaches of fiduciary
duties committed by its directors on the theory that the merger
could not occur without our participation. No proceedings on
the merits have occurred with respect to this action, and the
case is dormant.
AETHER SYSTEMS: NY Court Preliminarily Approves Suit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Aether
Systems, Inc. and certain of its officers and directors.
The Company is among the hundreds of defendants named in nine
class action lawsuits seeking damages on account of alleged
violations of securities law. The case is being heard in the
United States District Court for the Southern District of New
York. The court has consolidated the actions by all of the
named defendants that actually issued the securities in
question. Now there are approximately 310 consolidated cases
before Judge Shira Scheindlin, including the Aether Systems
action, under the caption "In Re Initial Public Offerings
Litigation, Master File 21 MC 92 (SAS)."
These actions were filed on behalf of persons and entities that
acquired the Company's common stock after its initial public
offering in October 20, 1999. Among other things, the
complaints claim that prospectuses, dated October 20, 1999 and
September 27, 2000 and issued by the Company in connection with
the public offerings of common stock, allegedly contained untrue
statements of material fact or omissions of material fact in
violation of securities laws because the prospectuses allegedly
failed to disclose that the offerings' underwriters had
solicited and received additional and excessive fees,
commissions and benefits beyond those listed in the arrangements
with certain of their customers which were designed to maintain,
distort and/or inflate the market price of the Company's common
stock in the aftermarket. The actions seek unspecified monetary
damages and rescission.
Initial motions to dismiss the case were filed and the court
held oral argument on the motions to dismiss on November 1,
2002. On February 19, 2003, the court issued an Opinion and
Order on defendants' motions to dismiss, which granted the
motions in part and denied the motions in part. As to the
Company, the motion to dismiss the claims against it was denied
in its entirety. Discovery has now commenced. The plaintiffs
voluntarily dismissed without prejudice the officer and director
defendants of the Company.
On June 26, 2003, the Plaintiff's Executive Committee in this
case announced a proposed settlement with the issuers. The
proposed settlement is a settlement among the plaintiffs, the
issuer-defendants, including the Company, and the officer and
director defendants of the issuers. The plaintiffs will
continue litigating their claims against the underwriter-
defendants. Under terms of the proposed settlement, the Company
would not incur any material financial or other liability. On
June 14, 2004, the plaintiffs and issuer defendants presented
the executed settlement agreement to Judge Scheindlin during a
court conference. Subsequently, plaintiffs and issuers made a
motion for preliminary approval of the settlement agreement. On
July 14, 2004, the underwriter defendants filed a memorandum of
law in opposition to plaintiffs' motion for preliminary approval
of the settlement agreement. Reply briefs in support of the
settlement were submitted to the court. In December 2004, the
court ordered additional briefing on the motion. All of the
additional briefs were submitted to the court. On February 15,
2005, Judge Scheindlin issued an Opinion and Order granting
preliminary approval to the settlement agreement. The court
will schedule a fairness hearing on the proposed settlement and
subsequently will decide whether to grant final approval to the
settlement agreement. The settlement agreement is subject to
the approval of the District Court.
The suit is styled "In re Aether Systems, Inc. Initial Public
Offering Sec. Litigation," related to "In re Initial Public
Offering Securities Litigation, Master File No. 21 MC 92 (SAS),"
filed in the United States District Court for the Southern
District of New York under Judge Shira A. Scheindlin. The
plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
ALLOS THERAPEUTICS: Asks CO Court To Dismiss Securities Lawsuit
---------------------------------------------------------------
Allos Therapeutics, Inc. asked the United States District Court
for the District of Colorado to dismiss the consolidated
securities class action filed against it and one of its
officers.
An amended complaint was filed in August 2004. The lawsuit is
brought on behalf of a purported class of purchasers of the
Company's securities during the period from April 23, 2003 to
April 29, 2004, and is seeking unspecified damages relating to
the issuance of allegedly false and misleading statements
regarding EFAPROXYN during this period and subsequent declines
in the Company's stock price. On October 12, 2004, the Company
filed a motion to dismiss the case with prejudice. That motion
remains pending.
AMERICAN HONDA: Recalls 1,923 Passenger Cars For Crash Hazard
-------------------------------------------------------------
American Honda Motor Co. is cooperating with the National
Highway Traffic Safety Administration (NHTSA) by voluntarily
recalling 1,923 passenger cars, namely:
(1) ACURA / TL, model 2005
(2) HONDA / ACCORD, model 2005
(3) HONDA / ODYSSEY, model 2005
On certain passenger vehicles, a loose terminal in the main fuse
box may cause the fuel pump to lose power. If the fuel power
becomes inoperative, the engine may not start. If the fuel pump
loses power while driving the engine could stall without
warning, which could result in a crash.
Dealers will replace the entire fuse box. The recall is
expected to begin on April 13,2005. For more details, contact
Honda by Phone: 800-999-1009, Acura by Phone: 1-800-382-2238 or
the NHTSA's auto safety hotline: 1-888-327-4236.
ASIAINFO HOLDINGS: NY Court Preliminarily OKs Lawsuit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the consolidated
securities class action filed against Asiainfo Holdings, Inc.,
certain of its officers and directors and the underwriters of
its initial public offering, or IPO.
On December 4, 2001, a securities class action case was filed,
alleging violations of the federal securities laws and was
docketed in the United States District Court for the Southern
District of New York as "Hassan v. AsiaInfo Holdings, Inc., et
al." The lawsuit alleged, among other things, that the
underwriters of the Company's IPO improperly required their
customers to pay the underwriters excessive commissions and to
agree to buy additional shares of Company common stock in the
aftermarket as conditions to their purchasing shares in the
company's IPO. The lawsuit further claimed that these supposed
practices of the underwriters should have been disclosed in the
Company's IPO prospectus and registration statement. The suit
seeks rescission of the plaintiffs' alleged purchases of our
common stock as well as unspecified damages.
In addition to the case against the Company, various other
plaintiffs have filed approximately 1,000 other, substantially
similar class action cases against approximately 300 other
publicly traded companies and their IPO underwriters in New York
City, which along with the case against the Company have all
been transferred to a single federal district judge for purposes
of case management. On July 15, 2002, together with the other
issuer defendants, the Company filed a collective motion to
dismiss the consolidated, amended complaints against the issuers
on various legal grounds common to all or most of the issuer
defendants. The underwriters also filed separate motions to
dismiss the claims against them. On October 9, 2002, the court
dismissed without prejudice all claims against the individual
defendants in the litigation. The dismissals were based on
stipulations signed by those defendants and the plaintiffs'
representatives.
On February 19, 2003, the court issued its ruling on the motions
to dismiss filed by the underwriter and issuer defendants. In
that ruling the court granted in part and denied in part those
motions. As to the claims brought against the Company under the
anti-fraud provisions of the securities laws, the court
dismissed all such claims without prejudice. As to the claims
brought under the registration provisions of the securities
laws, which do not require that intent to defraud be pleaded,
the court denied the motion to dismiss such claims as to the
Company and as to substantially all of the other issuer
defendants. The court also denied the underwriter defendants'
motion to dismiss in all respects.
In June 2003, based on a decision made by a special independent
committee of the Company's board of directors, the Company
elected to participate in a proposed settlement agreement with
the plaintiffs in this litigation. If ultimately approved by
the court, this proposed settlement would result in a dismissal,
with prejudice, of all claims in the litigation against us and
against any of the other issuer defendants who elect to
participate in the proposed settlement, together with the
current or former officers and directors of participating
issuers who were named as individual defendants. The proposed
settlement does not provide for the resolution of any claims
against the underwriter defendants, and the litigation against
those defendants is continuing.
The proposed settlement provides that the class members in the
class action cases brought against the participating issuer
defendants will be guaranteed a recovery of $1 billion by
insurers of the participating issuer defendants. If recoveries
totaling $1 billion or more are obtained by the class members
from the underwriter defendants, however, the monetary
obligations to the class members under the proposed settlement
will be satisfied. In addition, all participating issuer
defendants will be required to assign to the class members
certain claims that the Company may have against the
underwriters. The proposed settlement contemplates that any
amounts necessary to fund the settlement or settlement-related
expenses would come from participating issuers' directors and
officers liability insurance policy proceeds as opposed to funds
of the participating issuer defendants themselves. A
participating issuer defendant could be required to contribute
to the costs of the settlement if that issuer's insurance
coverage were insufficient to pay that issuer's allocable share
of the settlement costs. Consummation of the proposed settlement
is conditioned upon, among other things, negotiating, executing,
and filing with the court final settlement documents, and final
approval by the court.
CAESAR'S PALACE: EEOC Initiates Complaint For Sexual Harassment
---------------------------------------------------------------
A class of kitchen workers was severely sexually harassed by
supervisors for years at famed Las Vegas hotel/casino Caesars
Palace, the U.S. Equal Employment Opportunity Commission (EEOC)
charged in an employment discrimination lawsuit. The EEOC also
said Caesars management illegally retaliated against employees
for complaining about the abuse.
The EEOC's suit, "EEOC v. Caesars Entertainment, Inc., et al.,
CV-S-05-0427-LRH-PAL," was filed in U.S. District Court for the
District of Nevada under Title VII of the Civil Rights Act of
1964 against hotel and casino giant Caesars Entertainment, Inc.
/ Park Place Entertainment Corporation. The EEOC alleges that
since 2000, kitchen workers at Caesars Palace were victimized by
egregious harassment, including:
(1) A supervisor trying to have forced sex with a worker
when she was four months pregnant;
(2) Another supervisor exposing himself to the same
employee three to four times, making lewd suggestions
and forcing her hand to his private parts;
(3) A third supervisor showing another worker nude
pictures, forcibly grabbing her breasts, buttocks and
kissing her as he exposed himself and performed lewd
acts on her;
(4) Yet another supervisor grabbing an employee by her hair
and forcing her face to his private parts and forcing
oral sex on her;
(5) Other instances of fondling the charging parties and
demanding oral sex;
(6) Supervisors offering favorable treatment in exchange
for sex.
The suit also charges that employees who complained about the
harassment by supervisors were subjected to retaliation in the
form of demotion, loss of wages, further harassment, discipline
or discharge.
Such alleged conduct violates Title VII, which prohibits
employment discrimination based on race, color, religion, sex
(including sexual harassment or pregnancy) or national origin
and protects employees who complain about such offenses from
retaliation. The EEOC filed suit after exhausting its
conciliation efforts to reach a voluntary pre-litigation
settlement.
The Regional Attorney for the EEOC's Los Angeles District
Office, Anna Park, added, "All sexual harassment is wrong and
illegal. The EEOC is absolutely determined to stop this
misconduct."
Olophius Perry, District Director of the EEOC's Los Angeles
District Office, said, "Employees need to be encouraged to
report harassment of all kinds. Disciplining or discharging an
employee for trying to do what is required under the law is
simply wrong, and the EEOC will be steadfast in protecting
employees against acts of retaliation."
Caesars Entertainment / Park Place Entertainment identifies
itself as one of the world's leading gaming companies, with $4.5
billion in annual net revenue and 28 properties in five
countries on four continents. The company has its corporate
headquarters in Las Vegas, Nev., where it operates Caesars
Palace and three other major casino resorts.
In addition to enforcing Title VII, the EEOC enforces the Age
Discrimination in Employment Act of 1967 (ADEA), which protects
workers age 40 and older from discrimination based on age; the
Equal Pay Act of 1963, which prohibits gender-based wage
discrimination; the Rehabilitation Act of 1973, which prohibits
employment discrimination against people with disabilities in
the federal sector; Title I of the Americans with Disabilities
Act of 1990 (ADA), which prohibits employment discrimination
against people with disabilities in the private sector and state
and local governments; and sections of the Civil Rights Act of
1991. Further information about the Commission is available on
the agency's web site at www.eeoc.gov, or by calling
(800) 669-4000.
For more details, contact Anna Y. Park, Regional Attorney by
Phone: (213) 894-1080 or contact Gregory L. McClinton, Trial
Attorney by Phone: (213) 894-1053 or (213) 894-1121.
CALIFORNIA: AG Lockyer Files Complaint V. Illegal Spam Operation
----------------------------------------------------------------
California Attorney General Bill Lockyer asked a federal court
to shut down a major California-based spam operation that has
bombarded people across the country with illegal email ads
pitching mortgage services, car warranties, travel deals,
prescription drugs and college degrees.
"Spam ranks as one of the major consumer and business protection
problems of our generation," said Attorney General Lockyer. "It
clogs our email boxes, invades our privacy, serves as a gateway
to consumer fraud and costs our businesses billions of dollars.
California has been a national leader in fighting spam, and
stopping this operation is in keeping with that tradition. My
office will continue to aggressively prosecute those who flout
our anti-spam laws."
U.S. District Court Judge Samuel Conti, Northern District of
California, heard a request that he issue a temporary
restraining order (TRO) in a 13-count lawsuit against the
spammers filed jointly by the Attorney General and the Federal
Trade Commission (FTC). The TRO requested by Attorney General
Lockyer and the FTC would stop the defendants from continuing to
send illegal spam, freeze their assets and require them to turn
over to his office and the FTC computer records related to their
operation. The defendants include Los Angeles residents Rick
Yang and Peonie Pui Ting Chen, and the spam operation they run
under the corporate names of Optin Global, Inc. and Vision Media
Limited Corp. Judge Conti could rule on the TRO request as early
as today.
Attorney General Lockyer's action makes California the first
state in the country to bring a lawsuit jointly with the FTC
under a federal anti-spam law that took effect January 1, 2004.
The federal statute is known as the CAN-SPAM Act (Controlling
the Assault of Non-Solicited Pornography and Marketing Act of
2003). The lawsuit also is the first filed by the Attorney
General under the recently-revised California anti-spam law,
which was amended in 2004 after much of it was preempted by the
CAN-SPAM Act.
For violations of the CAN-SPAM Act, he and the FTC seek damages,
disgorgement of ill-gotten profits, and immediate and permanent
injunctive relief to prohibit further violations of the law. For
violations of California law, he seeks civil penalties of $2,500
per violation, actual damages, and liquidated damages of $1,000
per illegal email, up to $1 million per incident.
"Since at least January 1, 2004, and continuing to the present
(the) defendants have initiated the transmission of hundreds of
thousands of commercial email messages," the complaint alleges.
Attorney General Lockyer and the FTC allege the defendants
violated provisions of the CAN-SPAM Act that require senders of
unsolicited email ads to provide recipients the ability to
request not to receive further emails, prohibit senders from
transmitting messages to recipients who make such requests,
require senders to include a valid postal address and require
senders to identify commercial emails as ads. The defendants
also violated federal and state laws that prohibit commercial
emails from containing false or deceptive header information and
subject lines, according to the complaint.
The defendants' spam advertises such products as auto
warranties, pharmaceutical products, online college degree
programs and mortgage services, the complaint alleges. The
emails typically contain hyperlinks to defendant-operated web
sites that promote the products and services, according to the
complaint. The defendants used mailing addresses in several
countries, including China and Canada, and Internet domains
registered in Switzerland.
Since March 2004, the court papers allege, consumers across the
country have forwarded to the FTC more than 1,870,000 spam
messages that advertise web sites linked to the defendants. In
California, Attorney General Lockyer's office has received from
consumers more than 4,000 such emails since January 2004.
Many of the defendants' spam messages, according to the
complaint, market mortgage services. When directed by hyperlinks
to the defendants' mortgage services web sites, consumers are
asked to provide personal information, ostensibly to be shared
with mortgage brokers or banks.
In fact, the complaint alleges, the defendants sell the personal
information to "lead" companies, which then sell the information
to other "lead" companies. Ultimately, the information winds up
in the hands of mortgage lenders and brokers, such as Ameriquest
Mortgage Company, Indy Mac Bank, BLS Funding and Mortgage South.
The lenders and brokers then contact consumers and offer
mortgage services, according to the complaint. Mortgage lead
companies that bought the personal information directly from the
defendants include Abacus Enterprises and Infinite Leads
Marketing. Abacus Enterprises, based in El Cerrito, purchased
about 69,000 leads from the defendants in 2004, the complaint
alleges.
Internet service providers (ISPs), including Microsoft,
cooperated with Lockyer's office and the FTC in the
investigation. In March 2004, Microsoft, Yahoo, America Online
and Earthlink filed CAN-SPAM lawsuits of their own against major
spammers. And the FTC has brought several enforcement actions
under the CAN-SPAM law since April 2004.
Despite the best efforts of law enforcement, regulators and
ISPs, spam has become a substantial, persistent and costly
problem. In 2001, spam accounted for eight percent of all email.
By March 2004, the number had reached 62 percent. In 2002,
experts estimated spam cost U.S. businesses about $9 billion in
lost productivity, and screening and other expenses.
Attorney General Lockyer encourages Californians who believe
they have received illegal spam to file complaints with his
office. Complaints can be filed by writing to the Public Inquiry
Unit at P.O. Box 944255, Sacramento, CA 94244-2550. Californians
who receive spam at their email addresses also can send examples
to the Attorney General's Office at caspam@doj.ca.gov.
Consumers can find out how to file a spam complaint with the
FTC, or send spam to the FTC, visit the Website:
http://www.ftc.gov.
CALIFORNIA: PRI Talks About Employment Bias Cases at SIOP Meet
--------------------------------------------------------------
At the recent Society for Industrial and Organizational
Psychology (SIOP) annual conference, Lisa Harpe, Ph.D., an
industrial psychologist and senior consultant for the
Peopleclick Research Institute (PRI), addressed employee
discrimination cases and statistical methods that examine
discrimination.
After providing an introduction to the federal rule of civil
procedure, which governs the litigation of class actions, Dr.
Harpe presented information on conducting studies during the
class certification stage of a class action lawsuit.
"Analysts should always examine a filed complaint along with the
company's policies and procedures for the personnel systems
mentioned in the complaint to correctly answer legal questions,"
said Dr. Harpe. "Job factors that affect the decisions under
investigation, such as pay or promotion, should be addressed
before a statistical model is chosen."
PRI, the affirmative action research and compliance consulting
arm of Peopleclick Inc., conducts tailored, quantitative
research to help employers and attorneys analyze employment
decisions, manage risk and promote workforce diversity.
According to Dr. Harpe, analysts may want to use a cohort
analysis, which groups similarly situated employees, to examine
an employer's decisions for evidence of discrimination. She
said, "A cohort analysis makes few assumptions about underlying
data and allows comparison of employees who are similarly
situated along racial or gender lines."
Since the American Society for Industrial and Organizational
Psychology's first annual conference in 1986, the organization
has hosted the conference for participants to learn about a wide
range of research and studies on workplace issues and trends.
For more details, contact Kathy Barton of Peopleclick by Phone:
919-645-2862 by E-mail: kathy.barton@peopleclick.com or visit
their Web site: http://www.peopleclick.comor Meggan Manson of
Young & Associates by Phone: 410-641-4055 or by E-mail:
megganm@yapr.com.
CENTRA SOFTWARE: NY Court Preliminarily Approves Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement for the
consolidated securities class action filed against Centra
Software, Inc., certain of its officers and directors and the
managing underwriters of its initial public offering.
The plaintiffs filed an initial complaint on December 6, 2001
and purported to serve us on or about March 18, 2002. The
original complaint has been superseded by an amended complaint
filed in April 2002. The action, captioned "in re Centra
Software, Inc. Initial Public Offering Securities Litigation,
No. 01 CV 10988," which is being coordinated with an action
captioned "in re Initial Public Offering Securities Litigation,
No. 21 MC 92," is purportedly brought on behalf of the class of
persons who purchased the Company's common stock between
February 3, 2000 and December 6, 2000.
The complaint asserts claims under Sections 11 and 15 of the
Securities Act of 1933 and Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934. The complaint alleges that, in
connection with the Company's initial public offering in
February 2000, the underwriters received undisclosed commissions
from certain investors in exchange for allocating shares to them
and also agreed to allocate shares to certain customers in
exchange for the agreement of those customers to purchase
additional shares in the after-market at pre-determined prices.
The complaint asserts that the Company's registration statement
and prospectus for the offering were materially false and
misleading due to their failure to disclose these alleged
arrangements. The complaint seeks damages in an unspecified
amount against the Company and the named individuals.
The Company joined in motions with the underwriter defendants to
dismiss the above-reference action on July 3 and July 15, 2002,
respectively. On October 9, 2002, the plaintiffs dismissed,
without prejudice, the claims against the Company's officers and
directors in the above-referenced action. On February 19, 2003,
the court issued an order denying the motion to dismiss as to
the other defendants and the Company. On June 7, 2003, the
plaintiffs announced a proposed settlement with all issuers,
including the Company. On June 25, 2004, the plaintiffs filed a
motion with the United States District Court for the Southern
District of New York requesting preliminary approval of the
settlement. The court has given preliminary approval of the
settlement. The Company plans to participate in this
settlement, which has been negotiated, and will be fully funded
directly to the plaintiffs, by its insurers.
The suit is styled "in re Centra Software, Inc. Initial Public
Offering Securities Litigation, No. 01 CV 10988," related to "In
re Initial Public Offering Securities Litigation, Master File
No. 21 MC 92 (SAS)," filed in the United States District Court
for the Southern District of New York under Judge Shira A.
Scheindlin. The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
CROMPTON CORPORATION: PA Court OKs Antitrust Lawsuit Settlement
---------------------------------------------------------------
The United States District Court for the Eastern District of
Pennsylvania granted final approval to the settlement of a
single consolidated direct purchaser class action filed against
Crompton Corporation and other companies.
The suit was filed on behalf of a class consisting of all
persons and entities who purchased plastics additives in the
United States directly from any of the defendants or from any
predecessors, parents, subsidiaries or affiliates thereof at any
time during the period from January 1, 1990 through January 31,
2003. The complaint in this action principally alleged that the
defendants conspired to fix, raise, maintain or stabilize prices
for plastics additives sold in the United States in violation of
Section 1 of the Sherman Act and that this caused injury to the
plaintiffs who paid artificially inflated prices for such
products as a result of such alleged anticompetitive activities.
Under the Plastics Additives Settlement Agreement, the Company
paid $5.0 million to a settlement fund in exchange for the final
dismissal with prejudice of the lawsuit as to the Company and a
complete release of all claims against the Company set forth in
the lawsuit. The court granted final approval of the Plastics
Additives Settlement Agreement in January 2005.
The suit is styled "In re Plastic Additives Antitrust
Litigation, No. 03 CV 2038, M.D.L. No. 1547," filed in the
United States District Court for the Eastern District of
Pennsylvania, under Judge Legrome D. Davis. The Company is
represented by Thomas J. Mcgarrigle, 2500 One Liberty Pl., 1650
Market St., Philadelphia PA 19103-7301 Phone: 215-851-8220 Fax:
215-851-1420. Representing the plaintiffs are:
(1) Hilary Cohen, Craig W. Hillwig, William E. Hoese, and
Joseph C. Kohn, KOHN SWIFT & GRAF, P.C., One South
Broad Street Suite 2100 Philadelphia, PA 19107 Phone:
215-238-1700 Fax: 215-238-1968 E-mail:
chillwig@kohnswift.com; and hcohen@kohnswift.com;
(2) Gregory P. Hansel, One City Center, P.O. Box 9546
Portland, ME 04112-9546 Phone: 207-791-3000 Fax: 207-
791-3111;
(3) Robert N. Kaplan, KAPLAN FOX & KILSHEIMER LLP, 805
Third Ave., 22/F, New York, NY 10022 Phone: 212-687-
1980 E-mail: rkaplan@kaplanfox.com;
(4) Roberta D. Liebenberg, FINE, KAPLAN AND BLACK 1845
Walnut Street, Suite 2300 Philadelphia PA 19103 Phone:
215-567-6565 Fax: 215-568-5872 E-mail:
rliebenberg@finekaplan.com;
(5) Eugene A. Spector, SPECTOR, ROSEMAN & KODROFF 1818
Market Street, Suite 2500 Philadelphia PA 19103 Phone:
215-496-0300 Fax: 215-496-6611 E-mail:
espector@srk-law.com;
(6) Randall B. Weill, P.O. Box 9546 One City Center,
Portland, ME 04112-9546 Phone: 207-791-3000 E-mail:
rweill@preti.com
CROMPTON CORPORATION: Forges Pact For CT, PA, CA Antitrust Suits
----------------------------------------------------------------
Crompton Corporation reached a settlement for three consolidated
direct purchaser class actions filed against it, its subsidiary
Uniroyal Chemical Company, Inc., now known as Crompton
Manufacturing, Inc. and other companies in the United States
District Courts in the District of Connecticut, Western District
of Pennsylvania and Northern District of California.
On January 11, 2005, the Company and plaintiff class
representatives entered into a Settlement Agreement for the
suits, which were filed on behalf of all persons or entities who
purchased ethylene propylene diene monomer (EPDM), nitrile
rubber and rubber chemicals, respectively, in the United States
directly from one or more of the defendants or any predecessor,
parent, subsidiary or affiliates thereof, at any time during
various periods, with the earliest commencing on January 1,
1995. The complaints in the consolidated actions principally
alleged that the defendants conspired to fix, raise, maintain or
stabilize prices for EPDM, nitrile rubber and rubber chemicals,
as applicable, sold in the United States in violation of Section
1 of the Sherman Act and that this caused injury to the
plaintiffs who paid artificially inflated prices for such
products as a result of such alleged anticompetitive activities.
Under the Global Settlement Agreement, the Company agreed to pay
$97.0 million to a settlement fund in exchange for the final
dismissal with prejudice of the foregoing three lawsuits as to
the Company and a complete release of all claims against the
Company set forth in the lawsuits. The plaintiffs, with the
assistance of a neutral party, will determine the allocation of
the settlement funds, or if the plaintiffs fail to achieve
agreement, the neutral party will establish the allocation. When
the allocation of the settlement funds has been determined, the
parties will enter into Implementing Settlement Agreements for
the applicable affected actions. Following an initial payment of
$500,000 to an escrow account, the Company will pay the
settlement funds to an escrow account in three installments,
without interest, beginning at preliminary approval of the
Implementing Settlement Agreements by the applicable courts and
continuing through the later of 20 days following final approval
of the settlement by each applicable court or June 30, 2006.
The Company has the right to rescind the Global Settlement
Agreement in its entirety if:
(1) the court for the rubber chemicals action or the court
for the EPDM action refuses to approve the Implementing
Settlement Agreements for the applicable product area
without modification, or does not enter the final
judgment, or
(2) the court for the rubber chemicals action and the court
for the EPDM action enter the final judgment and
appellate review is sought and, on such review, either
or both of those final judgments is modified or set
aside on appeal.
Under certain circumstances relating to persons requesting
exclusion from the applicable class, the Company has the option
to terminate the Global Settlement Agreement in whole or in
part.
CROMPTON CORPORATION: Continues To Face Federal Antitrust Suits
---------------------------------------------------------------
Crompton Corporation, individually or together with its
subsidiary Uniroyal Chemical Company, and other companies,
continues to be or has become a defendant in certain direct
purchaser lawsuits filed in federal courts during the period
from May 2004 through December 2004 involving the sale of rubber
chemicals, Ethylene Propylene Diene Monomer (EPDM),
polychloroprene, nitrile rubber, plastics additives and
urethanes and urethane chemicals.
With respect to rubber chemicals, the Company, Uniroyal and
other companies are defendants in two single direct purchaser
lawsuits, one filed on July 15, 2004, in the United States
District Court, Western District of Pennsylvania, by RBX
Industries, Inc., and the other filed on July 16, 2004, in the
United States District Court, Northern District of Ohio, by
Goodyear Tire & Rubber Company, in each case, with respect to
purchases of rubber chemicals from one or more of the
defendants. Both actions have been transferred to the Northern
District of California for pre-trial purposes by the Judicial
Panel on Multidistrict Litigation.
With respect to EPDM, the Company, Uniroyal and other companies
are defendants in a single direct purchaser lawsuit filed on May
7, 2004, in the United States District Court, Northern District
of Ohio, by Goodyear Tire & Rubber Company with respect to
purchases of EPDM and polychloroprene from one or more of the
defendants. The Company, Uniroyal and other companies are also
defendants in a single direct purchaser lawsuit filed on July
28, 2004, in the United States District Court, Eastern District
of Pennsylvania, by RBX Industries, Inc. Both actions have been
transferred to the District of Connecticut for pre-trial
purposes by the Judicial Panel on Multidistrict Litigation.
With respect to nitrile rubber, the Company, Uniroyal and other
companies are defendants in a direct purchaser class action
lawsuit filed on November 30, 2004, in the United States
District Court, Western District of Pennsylvania, by Quabaug
Corporation on behalf of itself and a class consisting of all
persons or entities who purchased nitrile rubber directly from
one or more of the defendants or any predecessor, successor,
subsidiary, or affiliate of any of the defendants in the United
States during the period from January 1, 1995 through June 30,
2003.
The Company, Uniroyal and other companies are defendants in a
direct purchaser lawsuit filed on November 14, 2004, in the
United States District Court, Northern District of Ohio, by
Parker Hannifin Corporation and PolyOne Corporation with respect
to purchases of EPDM, nitrile rubber and polychloroprene from
one or more of the defendants.
With respect to plastics additives, the Company and other
companies are defendants in a single direct purchaser lawsuit,
filed on December 28, 2004, in the United States District Court,
Northern District of Ohio, by PolyOne Corporation with respect
to purchases of plastics additives from one or more of the
defendants. In February 2005, the Company filed an unopposed
motion with the Judicial Panel on Multidistrict Litigation for
the transfer of this action to the Eastern District of
Pennsylvania for coordination with the consolidated class action
pending there.
With respect to urethanes and urethane chemicals, the Company,
Uniroyal and other companies are defendants in a consolidated
direct purchaser class action lawsuit filed on November 19,
2004, in the United States District Court, District of Kansas,
by plaintiffs on behalf of themselves and a class consisting of
all persons and entities who purchased urethanes and urethane
chemicals in the United States directly from any of the
defendants or from any present or former parent, subsidiary or
affiliate thereof at any time during the period from January 1,
1998 to the present. This action consolidates twenty-six direct
purchaser class action lawsuits previously described in the
Company's quarterly report on Form 10-Q for the quarter ended
September 30, 2004.
The complaints in these actions principally allege that the
defendants conspired to fix, raise, maintain or stabilize prices
for rubber chemicals, EPDM, polychloroprene, nitrile rubber,
plastics additives or urethanes and urethane chemicals, as
applicable, sold in the United States in violation of Section 1
of the Sherman Act and that this caused injury to the plaintiffs
who paid artificially inflated prices for such products as a
result of such alleged anticompetitive activities. With respect
to the complaints relating to the sale of polychloroprene,
although the Company does not sell or market polychloroprene,
the complaints allege that the Company and producers of
polychloroprene conspired to raise prices with respect to
polychloroprene and the other products included in the complaint
collectively in one conspiracy. In each of the foregoing
actions, the plaintiffs seek, among other things, treble damages
of unspecified amounts, costs (including attorneys' fees) and
injunctive relief preventing further violations of the Sherman
Act.
CROMPTON CORPORATION: Faces State Chemical Antitrust Lawsuits
-------------------------------------------------------------
Crompton Corporation individually or together with its
subsidiary Uniroyal Chemical Company, and other companies,
continues to be or has become a defendant in certain direct
purchaser lawsuits filed in state courts during the period from
May 2004 through December 2004 involving the sale of rubber
chemicals, Ethylene Propylene Diene Monomer (EPDM),
polychloroprene, nitrile rubber, plastics additives and
urethanes and urethane chemicals.
With respect to rubber chemicals, the Company, certain of its
subsidiaries and other companies remain defendants in ten
pending putative indirect purchaser class action lawsuits filed
during the period from October 2002 through February 2005 in
state courts in eight states.
Seven of the outstanding ten lawsuits were filed in California,
Florida, Minnesota, South Dakota, Tennessee, Vermont and West
Virginia, and the putative class in each lawsuit comprises all
persons within each of the applicable states who purchased tires
other than for resale that were manufactured using rubber
processing chemicals sold by the defendants since 1994. The
complaints principally allege that the defendants agreed to fix,
raise, stabilize and maintain the price of rubber processing
chemicals used as part of the tire manufacturing process in
violation the laws of these states and that this caused injury
to individuals who paid more to purchase tires as a result of
such alleged anticompetitive activities. The plaintiffs seek,
among other things, treble damages of an unspecified amount,
interest and attorneys' fees and costs.
The eighth lawsuit was filed in Massachusetts, and the putative
class comprises all natural persons within Massachusetts who
purchased for non-commercial purposes any product containing
rubber chemicals sold by the defendants or any subsidiary or
affiliate thereof, or any co-conspirator, since January 1, 1994
and who are residents of Massachusetts. The complaint
principally alleges that the defendants agreed to fix, raise,
stabilize and maintain the price of rubber chemicals distributed
or sold in Massachusetts and throughout the United States in
violation of the laws of that state and that the plaintiff and
the alleged class were injured. The plaintiff seeks, among other
things, double or treble damages of an unspecified amount,
interest and attorneys' fees and costs.
The ninth lawsuit was filed in Tennessee, and the putative class
comprises all individuals and entities in Tennessee, 22 other
states and the District of Columbia, who purchased rubber
chemicals indirectly from the defendants or any of their co-
conspirators, parents, predecessors, successors, subsidiaries
and affiliates at any time from at least January 1, 1994. The
complaint principally alleges that the defendants agreed to fix,
raise, stabilize and maintain the price of rubber chemicals and
to allocate markets and customers for the sale of rubber
chemicals in violation of the laws of these states and that this
caused the members of the class to pay inflated prices for
products manufactured using rubber chemicals. The plaintiffs
seek, among other things, to recover single or treble damages of
an unspecified amount, attorneys' fees and costs.
The Company and its defendant subsidiaries have filed motions to
dismiss on substantive and personal jurisdictional grounds or
answers with respect to eight of the lawsuits, and intends to
file motions to dismiss the remaining two lawsuits. Certain
motions to dismiss remain pending, and other motions to dismiss
have been denied by the applicable court, which are being, or
will be, appealed by the Company and its defendant subsidiaries.
With respect to EPDM, the Company, its subsidiary Uniroyal, and
other companies are defendants in fourteen pending putative
indirect purchaser class action lawsuits filed during the period
of October 2003 through February 2005 in state courts in twelve
states.
Ten of the outstanding fourteen lawsuits were filed in
California, North Carolina, Florida, New York, Iowa, New Mexico,
New Jersey, Vermont, Arizona and Nebraska, respectively, and the
putative class of each action comprises all persons or entities
in each of the applicable states who purchased indirectly EPDM
at any time from the defendants or any predecessors, parents,
subsidiaries, or affiliates thereof from at least January 1,
1994. The complaints principally allege that the defendants
conspired to fix, raise, stabilize, and maintain the price of
EPDM and allocate markets and customers in the United States,
including the foregoing states, respectively, in violation of
the laws of those states and that this caused injury to
purchasers who paid more to purchase indirectly EPDM as a result
of such alleged anticompetitive activities. The plaintiffs seek,
among other things, single or treble damages of an unspecified
amount, costs (including attorneys' fees), and disgorgement of
profits. The Company and its defendant subsidiaries have filed
motions to dismiss on substantive and personal jurisdictional
grounds or answers with respect to most of the foregoing
actions.
The eleventh lawsuit was filed in Tennessee, and the putative
class comprises all persons or business entities in Tennessee,
24 other states and the District of Columbia that purchased
indirectly EPDM manufactured, sold or distributed by the
defendants, other than for resale, from January 1994 to December
2002. The complaint principally alleges that the defendants
conspired to fix, raise, stabilize, and maintain the price of
EPDM and allocate markets and customers in the United States,
including the foregoing states, respectively, in violation of
the laws of those states and that this caused injury to
purchasers who paid more to purchase indirectly EPDM as a result
of such alleged anticompetitive activities. The plaintiffs seek,
among other things, single or treble damages of an unspecified
amount, costs (including attorneys' fees), and disgorgement of
profits. The Company and its defendant subsidiary have filed
motions to dismiss on substantive and personal jurisdictional
grounds in this action.
The twelfth lawsuit was filed in Tennessee, and the putative
class comprises all persons or entities in 23 states and the
District of Columbia who purchased EPDM indirectly from the
defendants or any of their co-conspirators, parents,
predecessors, successors, subsidiaries and affiliates at any
time from January 1, 1999 to the present. These lawsuits
principally allege that the defendants conspired to fix, raise,
stabilize, and maintain the price of EPDM and allocate markets
and customers in the United States, including the foregoing
states, respectively, in violation of the laws of those states
and that this caused injury to purchasers who paid more to
purchase indirectly EPDM as a result of such alleged
anticompetitive activities. The plaintiffs seek, among other
things, single or treble damages of an unspecified amount, costs
(including attorneys' fees), and disgorgement of profits.
With respect to plastics additives, the Company and other
companies are defendants in six pending putative indirect
purchaser class action lawsuits filed during the period of May
2004 through February 2005 in state courts in six states.
Five of the outstanding six lawsuits were filed in California,
Vermont, Arizona, Ohio and Nebraska, respectively, and the
putative class of each action comprises all persons or entities
in each of the applicable states who purchased indirectly
plastics additives at any time from any of the defendants, other
than for resale, during various periods, each commencing on
January 1, 1990.
The sixth lawsuit was filed on January 5, 2005 in Tennessee. The
putative class in this action comprises all individuals and
entities in 23 states and the District of Columbia who purchased
indirectly plastics additives from any of the defendants or any
of their predecessors, parents, subsidiaries or affiliates at
any time from January 1, 1990 to January 31, 2003.
Each of the foregoing lawsuits principally alleges that the
defendants and co-conspirators agreed to fix, raise, stabilize
and maintain the price of plastics additives in violation of the
laws of jurisdictions named in the complaints, as applicable,
and that this caused injury to purchasers who paid more to
purchase plastics additives as a result of such alleged
anticompetitive activities. The plaintiffs seek, among other
things, treble damages of an unspecified amount, costs
(including attorneys' fees) and/or injunctive relief preventing
the defendants from continuing the unlawful activities alleged
in the complaint.
With respect to nitrile rubber, the Company, its subsidiary
Uniroyal, and other companies are defendants in twelve pending
putative indirect purchaser class action lawsuits in state
courts in seven states.
Six of the outstanding twelve lawsuits were filed from March
2004 to August 2004 in California. The putative classes in these
actions comprise all persons or entities in California who
purchased indirectly nitrile rubber from any of the defendants
at various times from January 1, 1994. The complaints
principally allege that the defendants conspired to fix, raise,
stabilize and maintain the price of nitrile rubber and allocate
markets and customers in the United States and California in
violation of the laws of that state and that this caused injury
to purchasers who paid more to purchase, indirectly, nitrile
rubber as a result of such alleged anticompetitive activities.
The plaintiffs in these actions seek, among other things, treble
damages of an unspecified amount, costs (including attorneys'
fees), and disgorgement of profits. By agreement, plaintiffs in
the six California actions will file a consolidated amended
complaint.
One of the outstanding lawsuits was filed on January 5, 2005 in
Tennessee. The putative class comprises all individuals and
entities in 23 states and the District of Columbia who purchased
indirectly nitrile rubber from the defendants or any of their
co-conspirators, parents, predecessors, successors, subsidiaries
and affiliates from January 1, 1994 to the present. The
complaint principally alleges that the defendants conspired to
fix, raise, stabilize and maintain the price of nitrile rubber
and allocate markets and customers in Tennessee and the other
named jurisdictions in violation of the Tennessee Trade
Practices Act and the Tennessee Consumer Protection Act of 1977,
as well as the common law of the other named jurisdictions, and
that this caused injury to purchasers in the foregoing states
who paid more to purchase, indirectly, nitrile rubber as a
result of such alleged anticompetitive activities. The
plaintiffs seek, among other things, treble damages of
unspecified amounts and costs (including attorneys' fees).
Three of the outstanding lawsuits were filed in Vermont, Arizona
and Nebraska, respectively, and the putative class of each
action comprises all persons or entities in each of the
applicable states who purchased indirectly nitrile rubber
manufactured, sold or distributed by the defendants, other than
for resale, during January 1, 1995 through June 30, 2003. The
complaints principally allege that the defendants conspired to
fix, raise, stabilize and maintain the price of nitrile rubber
in violation of the laws of these states. The plaintiffs seek,
among other things, damages of unspecified amounts and costs
(including attorneys' fees).
With respect to urethanes and urethane chemicals, the Company,
its subsidiary Uniroyal, and other companies are defendants in
fifteen pending putative indirect purchaser class action
lawsuits in four states.
Eleven of the outstanding fifteen lawsuits were filed during the
period from March through June 2004 in California. The putative
class in the California actions comprises all persons or
entities in California who purchased indirectly urethanes and
urethane chemicals from any of the defendants at any time during
various periods with the earliest commencing on January 1, 1990.
Two of the lawsuits were each filed in Tennessee on December 22,
2004. The putative class in the first Tennessee action comprises
all natural persons who purchased indirectly urethanes and
urethane chemicals during the period from January 1, 1994 to
April 2004. The putative class in the second Tennessee action
comprises all individuals and entities in 23 states and the
District of Columbia who purchased indirectly urethanes and
urethane chemicals from the defendants or any of their co-
conspirators, parents, predecessors, successors, subsidiaries
and affiliates from March 19, 2000 through the present.
The foregoing lawsuits principally allege that the defendants
conspired to fix, raise, stabilize and maintain the price of
urethanes and urethane chemicals and allocate markets and
customers in violation of the laws of the applicable
jurisdictions, and that this caused injury to purchasers who
paid more to purchase, indirectly, urethanes and urethane
chemicals as a result of such alleged anticompetitive
activities. The plaintiffs seek, among other things, treble
damages of an unspecified amount, costs (including attorneys'
fees), and/or disgorgement of profits.
CROMPTON CORPORATION: Faces Two Multiple Product Antitrust Suits
----------------------------------------------------------------
The Company, its subsidiary Uniroyal Chemical Company, Inc., and
other companies are defendants in two pending putative indirect
purchaser class action lawsuits in two states that each involve
multiple products.
One of the outstanding multi-product lawsuits was filed in
Florida, and the putative class comprises all natural persons
who, within Florida, 19 other states and the District of
Columbia, purchased for non-commercial purposes any product
containing rubber and urethane products (defined to include
rubber chemicals, ethylene propylene diene monomer (EPDM),
nitrile rubber and urethanes and urethane chemicals)
manufactured or sold by any of the defendants, and which were
the subject of price-fixing by any of the defendants or any co-
conspirator, at any time from January 1, 1994 through December
31, 2004. The complaint principally alleges that the defendants
agreed to fix, raise, stabilize and maintain the price of rubber
chemicals distributed or sold in Florida, 19 other states and
the District of Columbia in violation of the laws of these
states and the District of Columbia, and that the plaintiff and
the alleged class were injured. The plaintiff seeks, among other
things, damages of an unspecified amount, interest and
attorneys' fees and costs.
The other outstanding multi-product lawsuit was filed in
Massachusetts, and the putative class comprises all natural
persons who, within Massachusetts, purchased for non-commercial
purposes any product containing rubber and urethane products
(defined to include EPDM, nitrile rubber, urethanes and urethane
chemicals) manufactured or sold by any of the defendants, and
which were the subject of price-fixing by any of the defendants
or any co-conspirator, at any time from January 1, 1994 through
December 31, 2004. The complaint principally alleges that the
defendants agreed to fix, raise, stabilize and maintain the
price of rubber chemicals distributed or sold in Massachusetts
and throughout the United States in violation of the laws of
that state, and that the plaintiff and the alleged class were
injured. The plaintiff seeks, among other things, damages of an
unspecified amount, interest and attorneys' fees and costs.
CROMPTON CORPORATION: Canada Motion To File Lawsuits Suspended
--------------------------------------------------------------
The two motions for authorization to commence a class action in
the Superior Court of the District of St. Francois and the
Superior Court of the District of Montreal, in Quebec, Canada,
against Crompton Corporation, Crompton Co./Cie (with respect to
the motion filed in the Superior Court of the District of St.
Francois only) and other companies have been suspended pending
determination of the constitutionality of certain Quebec civil
procedure rules involving class actions.
The motions were filed on behalf of persons and certain entities
that purchased in Quebec rubber chemicals directly or indirectly
from the parties respondent during various periods commencing in
July 1995. The motions principally allege that the Company
conspired with other defendants to restrain unduly competition
in the sale of rubber chemicals and to inflate artificially the
sale price of the rubber chemicals in violation of Canada's
Competition Act, and that this caused injury to purchasers who
paid artificially inflated prices for such rubber chemicals. The
plaintiffs in both motions seek, among other things,
authorization to commence their respective class actions,
recovery of the additional revenues generated by the artificial
inflation of the price of rubber chemicals, attorneys' fees and
costs. The plaintiff in the motion filed in the District of
Montreal also seeks exemplary and punitive damages.
CROMPTON CORPORATION: Canadians Commence EPDM Antitrust Lawsuit
---------------------------------------------------------------
A motion for authorization to commence a class action was filed
in February 2005, in the Superior Court of the District of
Quebec, in Quebec, Canada, against Crompton Corporation, its
subsidiaries Crompton Canada Corporation, Crompton Co./Cie and
Uniroyal Chemical Company, and other companies.
The motion was filed on behalf of all residents of Quebec who
purchased, used or received ethylene propylene diene monomer
(EPDM) or who purchased products containing EPDM between January
1, 1994 and December 31, 2002. The motion principally alleges
that the Company conspired with other defendants to restrain
unduly competition in the sale of EPDM and to inflate
artificially the sale price of EPDM in violation of Canada's
Competition Act, and that this caused injury to purchasers who
paid artificially inflated prices for EPDM or products
containing EPDM. The plaintiffs seek, among other things,
authorization to commence a class action, recovery of the
additional revenues generated by the artificial inflation of the
price of EPDM, exemplary and punitive damages, attorneys' fees
and costs.
CROMPTON CORPORATION: Faces EPDM Antitrust Suit in Ontario Court
----------------------------------------------------------------
A Statement of Claim was filed in October 2004, in the Ontario
Superior Court of Justice in London, Ontario in Canada, against
Crompton Corporation, its subsidiaries Crompton Canada
Corporation, Crompton Co./Cie and Uniroyal, and other companies.
The Statement of Claim was filed on behalf of a proposed class
of persons and entities in Canada who purchased ethylene
propylene diene monomer (EPDM) manufactured by the defendants or
products containing such EPDM during the period from at least
January 1994 to December 2002.
The Statement of Claim principally alleges that the Company
conspired with other defendants to restrain unduly competition
in the sale of EPDM and to inflate artificially the sale price
of EPDM in violation of Canada's Competition Act, and that this
caused injury to purchasers who paid artificially inflated
prices for EPDM. The plaintiff seeks, among other things,
general and punitive damages, interest and costs on behalf of
the proposed class. This case will proceed as a class action
only if, when and to the extent it is certified as a class
proceeding by the Ontario Court.
CROMPTON CORPORATION: Faces Antitrust Lawsuit in Canadian Court
---------------------------------------------------------------
A Statement of Claim was filed in February 2005, in the Ontario
Superior Court of Justice in London, Ontario in Canada, against
Crompton Corporation, its subsidiaries Crompton Canada
Corporation, Crompton Co./Cie and Uniroyal, and other companies.
The Statement of Claim was filed on behalf of a proposed class
of persons and entities in Canada who purchased rubber chemicals
(including accelerants and antidegradants) manufactured by the
defendants or products containing such rubber chemicals from at
least July 1995 to 2001.
The Statement of Claim principally alleges that the Company
conspired with other defendants to coordinate the timing and
amounts of price increases for certain rubber chemicals and to
allocate customers and sales volumes amongst themselves in
violation of Canada's Competition Act, and that this caused
injury to purchasers who paid artificially inflated prices for
rubber chemicals or products containing rubber chemicals. The
plaintiff seeks, among other things, general and punitive
damages, interest and costs on behalf of the proposed class.
This case will proceed as a class action only if, when and to
the extent it is certified as a class proceeding by the Ontario
Court.
CROMPTON CORPORATION: Asks CT Court To Dismiss Securities Suit
--------------------------------------------------------------
Crompton Corporation asked the United States District Court for
the District of Connecticut to dismiss the consolidated class
action filed against it, certain of its former officers and
directors (the "Crompton Individual Defendants"), and certain
former directors of the Company's predecessor Witco Corporation.
The suit was filed on behalf of a class consisting of all
purchasers or acquirers of the Company's stock between October
1998 and October 2002. The consolidated amended complaint
principally alleges that the Company and the Crompton Individual
Defendants caused the Company to issue false and misleading
statements that violated the federal securities laws by
reporting inflated financial results resulting from an alleged
illegal, undisclosed price-fixing conspiracy. The putative class
includes former Witco Corporation shareholders who acquired
their securities in the Crompton-Witco merger pursuant to a
registration statement that allegedly contained misstated
financial results.
The complaint asserts claims against the Company and the
Crompton Individual Defendants under Section 11 of the
Securities Act of 1933, Section 10(b) of the Securities Exchange
Act of 1934, and Rule 10b-5 promulgated thereunder. Plaintiffs
also assert claims for control person liability under Section 15
of the Securities Act of 1933 and Section 20 of the Securities
Exchange Act of 1934 against the Crompton Individual Defendants.
The complaint also asserts claims for breach of fiduciary duty
against certain former directors of Witco Corporation for
actions they allegedly took as Witco Corporation directors in
connection with the Crompton-Witco merger. The plaintiffs seek,
among other things, unspecified damages, interest, and
attorneys' fees and costs. The Company and the Crompton
Individual Defendants filed a motion to dismiss on September 17,
2004, which is now fully briefed and pending. The former
directors of Witco Corporation filed a motion to dismiss in
February 2005, which is pending.
DDI CORPORATION: Plaintiffs File Amended Securities Suit in CA
--------------------------------------------------------------
Plaintiffs filed a second amended consolidated securities class
action against certain of DDi Corporation's officers and
directors, namely:
(1) Bruce D. McMaster, President and Chief Executive
Officer,
(2) Joseph P. Gisch, former Chief Financial Officer,
(3) Charles Dimick, former Chairman of its Board of
Directors,
(4) Gregory Halvorson, former Vice President of Operations,
and
(5) John Peters, former Vice President of Sales and
Marketing
In October and November 2003, several class action complaints
were filed in the United States District Court for the Central
District of California on behalf of purchasers of the Company's
common stock, alleging violations of the federal securities laws
between December 19, 2000 and April 29, 2002. Neither the
Company nor any of its subsidiaries was named in this lawsuit.
The complaints seek unspecified damages and allege that
defendants violated Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934 by, among other things, misrepresenting
and/or failing to disclose material facts about the Company's
reported and projected financial results during the class
period. In December 2003, a related class action complaint was
filed in the Central District of California alleging similar
claims against the same parties and seeking unspecified damages,
but also adding causes of action under the Securities Act of
1933 in connection with the Company's February 2001 secondary
offering. This complaint alleges that the defendants
misrepresented and/or failed to disclose material facts about
the Company's reported and projected financial results in
connection with the registration statement and prospectus for
the secondary offering. This complaint also added former
directors David Dominik, Steven Pagliuca, Steven Zide and Mark
Benham as defendants, as well as Bain Capital, Inc. and the
underwriters of the February 2001 offering.
On December 16, 2003, a federal district court judge
consolidated the Central District of California actions in to a
single action, styled "In re DDi Corp. Securities Litigation,
Case No. CV 03-7063-MMM (SHx)." On May 21, 2004, the Court
appointed as Lead Plaintiffs Paul Poppe, LeRoy Schneider, and
Rand Skolmick. On July 26, 2004, Lead Plaintiffs filed a
consolidated amended complaint on behalf of all persons or
entities who purchased Company common stock between December 19,
2000 and April 29, 2002, including those who acquired Company
common stock pursuant to, or traceable to, its February 14, 2001
secondary offering.
The consolidated amended complaint seeks unspecified damages and
alleges that defendants violated Sections 11, 12(a)(2), and 15
of the Securities Act and Sections 10(b) and 20(a) of the
Exchange Act by, among other things, misrepresenting and/or
failing to disclose material facts about the Company's reported
and projected financial results during the class period,
including reported and projected financial results in connection
with the registration statement and prospectus for the secondary
offering. Neither the Company nor any of it subsidiaries were
named as a defendant in this consolidated amended complaint.
Pursuant to a June 13, 2004 scheduling order, the defendants
responded to the consolidated amended complaint on September 9,
2004 with a motion to dismiss. The plaintiffs filed their
opposition on October 25, 2004. The defendants filed a reply in
support of the motion to dismiss in November 2004. On January
7, 2005, without the necessity of oral argument, the Court
entered an Order Denying in Part and Granting in Part
Defendants' Motions to Dismiss the Consolidated Amended
Complaint. The Court's Order denied the motions to dismiss to
the extent they relied upon statutes of limitations arguments.
The Court's Order granted the motions to dismiss on the grounds
that the Consolidated Amended Complaint failed to adequately
allege any materially false or misleading representations or
omissions. The Court's Order also granted Defendants' motions to
the extent the Consolidated Amended Complaint inappropriately
relied upon the group pleading or group published information
doctrine. As a consequence of this, the totality of plaintiffs'
claims were dismissed with leave to file a Second Amended
Consolidated Complaint. The plaintiffs filed a Second Amended
Complaint on February 22, 2005. The defendants are in the
process of briefing a motion to dismiss this complaint in
accordance with the Court-ordered schedule.
DYNEGY INC.: Settles Securities, Derivative Litigation in TX
------------------------------------------------------------
Dynegy Inc. (NYSE:DYN) reached a comprehensive settlement
agreement related to the shareholder litigation brought by the
Regents of the University of California as a class action in the
U.S. District Court in Houston.
In its lawsuit, the Regents alleged violation of securities laws
primarily related to "Project Alpha," a structured natural gas
transaction entered into by the company in 2001. The class
action included claims for damages on behalf of a class of
purchasers of Dynegy Class A common stock during the class
period of June 2001 to July 2002.
The Company agreed to provide total settlement payment of $468
million from Dynegy, which includes $150 million to be covered
by Dynegy's director and officer insurance policies, a $250
million cash payment, and the issuance of $68 million in Class A
common stock to the class represented by the Regents. Two
payments totaling $250 million will be made in 2005. An initial
payment of $175 million will be made during the second quarter,
followed by a second payment of $75 million upon federal court
approval. The company expects approval during the second half of
the year. Dynegy will also issue Class A common stock in the
value of $68 million following court approval. The number of
shares of Class A common stock will be determined based on a
calculation using a volume weighted average stock price for
Dynegy Class A common stock for 20 trading days ending today.
The Company also agreed to an election to the Board of Directors
of Dynegy Inc. of two new qualified directors from a list of not
less than five qualified candidates submitted by the Regents,
and in accordance with a time schedule consistent with the
approval of the settlement by the federal court. Thereafter,
the recommendation for election of two new directors to the
Board of Directors of Dynegy Inc. at the company's 2006 annual
shareholders' meeting from a list of not less than five
qualified candidates submitted by the Regents. The process for
election of the new directors will be conducted in accordance
with the normal processes previously established by Dynegy's
Corporate Governance and Nominating Committee for the election
of new directors.
In addition, in a related court case brought in Texas District
Court, two plaintiffs made similar claims to those in the class
action litigation. Dynegy has agreed to settle the derivative
litigation on the basis of corporate governance changes, many of
which have been implemented since the claim was filed. The
company has also agreed to pay related attorney fees and
expenses in the amount of $5 million. This settlement is not
included in the $468 million payment discussed above.
According to Bruce A. Williamson, Chairman, President and Chief
Executive Officer of Dynegy Inc., "As with other elements of our
self-restructuring, by entering into these settlement agreements
we are taking responsibility for the resolution of issues
associated with a past era for the company in order to put them
behind us. These settlements represent the last significant
legal impediments to the pursuit of growth opportunities for our
Natural Gas Liquids and Power Generation businesses. With these
matters resolved, management and the Board of Directors can
concentrate fully on the future direction of our company to
maximize value for shareholders."
"The financial impact of these settlements, along with liquidity
for our business operations, can be accommodated through our
available cash and bank lines," he said. "These settlements are
fair and equitable for all parties involved, including the
company, our current investors and former investors who are
members of the class."
Mr. Williamson added, "Finally, from a governance perspective,
we look forward to adding two new members to our Board of
Directors. We are confident that the diversity of skills and
contributions of the new directors will enhance our industry-
leading corporate governance practices."
Dynegy and various other parties settling the litigation do not
admit to any liability by the company, its directors or
officers. In addition, there were no findings of any violation
of federal securities laws.
Dynegy will record a first quarter pre-tax charge of
approximately $225 million (approximately $155 million after-
tax) related to the settlements and associated legal expenses.
While the settlements and expenses will impact the company's
2005 GAAP earnings guidance estimate, they do not affect core
business earnings. Management will provide updated guidance
reflecting the impact of the settlements, as well as differences
in current commodity and power prices from previously issued
commodity forecasts, during the release of the company's first
quarter 2005 financial results on Monday, May 9, 2005.
The suit is styled, "In re Dynegy, Inc. Securities Litigation,
Master File No. H-02-1571," filed in the United States District
Court for the Southern District of Texas - Houston Division. The
law firm of Lerach Coughlin Stoia Geller Rudman & Robbins LLP
represented the Regents. Dynegy was represented in the
litigation by the law firm of Haynes & Boone, LLP, while
Stonebridge International LLC and Hogan & Hartson, LLP,
represented the firm in the settlement.
ERPENBECK CO.: Subcontractors Receive Meager Settlement in KY
-------------------------------------------------------------
Subcontractors owed money by the Erpenbeck Co., a former
northern Kentucky homebuilding company that collapsed amid
scandal, received a legal settlement that will pay them no more
than 10 cents on the dollar, The Associated Press reports. U.S.
District Judge William O. Bertelsman approved the settlement in
which Erpenbeck's primary bank, the defunct Peoples Bank of
Northern Kentucky, agreed to pay the group $557,000.
Attorney Jerry Miniard of Florence, who filed the lawsuit in
2002, told AP "I'm very happy that the subcontractors received
something." Without the class action suit, they "would have
gotten nothing," he adds.
When the Erpenbeck Co. collapsed in April 2002 in a $34 million
check-kiting scheme, subcontractors found themselves at the
bottom of a long list of creditors. Banks were able to recover
some of their losses by seizing unfinished subdivisions and
unsold homes, while homeowners who faced the threat of
foreclosure were able to keep their homes. However, the
companies that supplied and helped build Erpenbeck homes had no
safety nets, in spite of state lien laws written for their
protection, some even went out of business. Eventually, fifty-
six subcontractors filed claims for $5.1 million in unpaid
debts.
Court documents revealed that the lead plaintiff in the lawsuit,
Morris Heating & Cooling of Boone County, worked on 12 to 15
Erpenbeck projects over nearly two years. Owner Louis Morris
told The Associated Press that Erpenbeck owed him $485,000. The
settlement with Peoples Bank, Mr. Morris adds that it will help
him recoup about 10 percent of that amount. He also told The
Associated Press, "Naturally everybody wishes we got a larger
amount of our money, but anything is better than nothing, I
guess. I'm glad it's over."
The task of qualifying claims and distributing the settlement
money falls to Covington lawyer Sue Cassidy, who is still unsure
when she would be done in executing the settlement. She told The
Associated Press, "I'm still in the process of reviewing claims
to see if they comply with the terms of the class action and
have the proper documentation to back up their claims."
Mr. Miniard, whose lawsuit also represented suppliers, told The
Associated Press that the group could receive additional money
from Peoples Bank's lawsuit against its audit firm. He also adds
that the subcontractors stand to receive 20 percent of any
settlement or judgment in that case, which was filed in Boone
County.
Bill Erpenbeck, the former president of Erpenbeck Co., pleaded
guilty to bank fraud in 2004 and is now serving 30 years in a
federal prison.
ESPEED INC.: Shareholders File Securities Fraud Suits in S.D. NY
----------------------------------------------------------------
eSpeed, Inc. faces several securities class actions filed in the
United States District Court for the Southern District of New
York, on behalf of all persons who purchased the securities of
eSpeed from August 12, 2003, to July 1, 2004. The suit also
names as defendants Cantor Fitzgerald, L.P. and certain
affiliated entities, as well as two of the Company's executive
officers, Howard Lutnick and Lee Amaitis.
The suits uniformly allege that the Company made "material false
positive statements during the class period" and violated
certain provisions of the U.S. Securities Exchange Act of 1934,
as amended, and certain rules and regulations thereunder. The
Complaint alleges that during the Class Period defendants touted
eSpeed as an unmitigated success story, but knowingly or
recklessly misrepresented and failed to disclose the following
material adverse facts:
(1) eSpeed was not successfully competing with ICAP Plc -
eSpeed's principal competitor;
(2) eSpeed's market share was declining;
(3) ICAP and its BrokerTec division were taking market
share from eSpeed; and
(4) eSpeed's pricing model was driving customers to its
principal competitor.
The litigation is styled "In Re Espeed, Inc. Securities
Litigation, case no. 1:05-cv-02091-SAS," filed in the United
States District Court for the Southern District of New York,
under Judge Shira A. Scheindlin. Representing the plaintiffs
are Roy Laurence Jacobs, Roy Jacobs & Associates 60 East 42nd
Street 46th Floor New York, NY 10165 Phone: 212-867-1156 Fax:
212-504-8343 E-mail: rljacobs@pipeline.com; and Laurence
Paskowitz, Paskowitz & Associates 60 East 42nd Street, 46th
Floor New York, NY 10165 Phone: (212)-685-0969 Fax:
(212)-685-2306 E-mail: classattorney@aol.com.
FINDWHAT.COM: Consumers Commence Lawsuit V. Gambling Ads in CA
--------------------------------------------------------------
Findwhat.com, Inc. faces a putative class action lawsuit was
filed in the Superior Court of the State of California, County
of San Francisco, by two individuals, Mario Cisneros and Michael
Voight, "on behalf of themselves, all other similarly situated,
and/or for the general public." The suit also names other
Internet search sites and service providers.
The complaint alleges that acceptance of advertising for
Internet gambling violates several California laws and
constitutes an unfair business practice. The complaint seeks
unspecified amounts of restitution and disgorgement as well as
an injunction preventing the Company from accepting paid
advertising for online gambling. Three of the Company's
industry partners, each of which is a co-defendant in the
lawsuit, have asserted indemnification claims against the
Company for costs incurred as a result of such claims arising
from transactions with the Company.
The suit is styled "Mario Cisneros et al, v. Yahoo! Inc., et al,
case no. CGC-04-433518," filed in the California Superior Court
in San Francisco County, under Judge Richard A. Kramer.
Representing the plaintiffs are Kathrein R. Reed and Ira P.
Rothken. Lawyers for the Company are David T. Biderman, Robert
Harvey Binzel, Janet L. Cullum, Charles H. Dick, Jr., Albert
Gidari, Richard Jay Idell, Matthew P. Kanny, David H. Kramer,
Thomas P. Laffey, Ryan M. Malone, Laurence F. Pulgram, John C.
Rawls, David O. Stewart.
FINDWHAT.COM: Faces Suit For Electronic Privacy Act Violations
--------------------------------------------------------------
Findwhat.com, Inc. faces a class action filed in the U.S.
District Court for the Northern District of Georgia, Atlanta
Division, by Robert R. Pagniello, on behalf of himself and all
others who are similarly situated. The suit also names as
defendants other Internet search services and websites.
The complaint alleges that the Defendants have, without
authorization or in excess of authorization given, installed
adware and other software on Plaintiff's and other Internet
users' computers and thereby caused damage to those computers.
The complaint seeks injunctive relief, unspecified damages and
punitive damages for alleged violations of the Electronic
Communications Privacy Act, common law trespass to personal
property, invasion of privacy, and violation of an unidentified
state consumer protection and deceptive business practice
statutes.
The suit is styled "Pagniello v. Microsmarts, LLC, case no.
1:04-cv-03131-CAM," filed in the United States District Court
for the Northern District of Georgia under Judge Charles A. Moye
Jr. Representing the Company is Richard Brooks Holcomb, Alston
& Bird 1201 West Peachtree Street One Atlantic Center Atlanta,
GA 30309-3424 Phone: 404-881-7000 E-mail: rholcomb@alston.com.
Representing the plaintiff Robert R. Pagniello is Jeffrey S.
Kowalski, Law Offices of Robert R. Pagniello 1400 Scott
Boulevard Decatur, GA 30030 Phone: 404-373-5550 E-mail:
JeffreyKowalski@Earthlink.net.
FLORIDA: Republicans Seeking Limits For Class Action Litigation
--------------------------------------------------------------
Florida's Republicans are pushing for the passing of a new bill
that aims to curb class action lawsuits, The Associated Press
reports. The bill known as HB 1925, which is set to go before
the House floor for a vote, would block out-of-state residents
from joining many Florida class-action suits and give defendants
a 60-day window to settle the case and fix whatever's wrong
before a class-action suit is filed.
According to several attorneys, who specialize in class action
suits, many potential plaintiffs won't get to participate
because cases will be settled before a judge ever certifies a
class. The business community though thinks few issues are as
important as trying to protect themselves from what they see as
out-of-control lawsuits. They point out that many of the suits
are simply nuisances, dealing with technicalities where no one
is hurt, and serve only to provide big windfalls for lawyers.
However, plaintiffs' lawyers fear the bill may prevent victims
from seeking justice by giving companies a chance to settle with
individual plaintiffs and keep the wrongdoing under wraps.
Had the legislation passed earlier, Weston lawyer Gary Farmer
says it might have prevented his clients from suing a Fort
Lauderdale cemetery that was burying people in the wrong plots,
AP reports. He adds that had his client had to notify the
cemetery before filing suit, it would have offered the family a
large settlement not to pursue a class-action case. Mr. Farmer
said, "The other 3,000, 4,000 family members never would have
even found out this was going on. This is a class-action
elimination bill."
FORBES REGIONAL: Negligence Suit Lodged Over Colon Examinations
---------------------------------------------------------------
Lawyers representing two local Pennsylvania residents launched a
lawsuit claiming that Forbes Regional Hospital was negligent in
allowing about 200 people to undergo colon examinations with
equipment that had not been adequately cleaned, The Pittsburgh
Post-Gazette reports.
Filed in Allegheny County Common Pleas Court, the lawsuit claims
that hospital officials knew about the cleaning problem in late
February but waited more than a month to inform patients that
they could be at risk of infection. The suit though does not
allege that anyone has been infected as a result of the colon
examinations.
Court documents revealed that hospital officials have said that
patients who had colonoscopies at Forbes between October 28 and
February 26 could have been infected, but emphasized that the
risk is extremely low. The suit, which also names Forbes'
parent corporation, West Penn Allegheny Health System, as a
defendant, asks the court to certify the suit as a class action
and to award compensatory and punitive damages to patients who
had the colonoscopies. In addition, the suit is also asking that
the court direct hospital officials to provide additional
testing to those patients affected. The suit is also asking for
a medical monitoring program, paid for by the hospital system
and supervised by the court, with tests conducted every six
months for two years.
Lawyers had filed the suit on behalf of Barbara Haluska of West
Mifflin and Linda Kiszie of Penn Hills. According to the
plaintiffs' attorney, Daniel Berger, more than 10 people who had
the colonoscopies have expressed an interest in pursuing a
claim.
Hospital officials have said the cleaning problem involved two
colonoscopes purchased last fall. Officials said hospital
staffers did not immediately notice that the scopes had
auxiliary channels that needed to be cleaned. Those unused
channels had not existed in colonoscopes previously used at
Forbes.
GENERAL MOTORS: Recalls 2,536 Sierra Denali SUVs For Injury Risk
----------------------------------------------------------------
General Motors Corporation is cooperating with the National
Highway Traffic Safety Administration (NHTSA) by voluntarily
recalling 2,536 Sierra Denali sport utility vehicles, model
2005.
The SUVs fail to comply with the requirements of federal motor
vehicle safety standard no. 225 "Child restraint anchorage
systems", the requirements for location and instructions for
properly attaching child restraints. The owner manual in these
vehicles indicate the incorrect seat locations with upper and
lower tether anchors and provide incorrect installation
instructions for the top tether anchorage. Improper use of
child restraint anchorage could result in personal injury to the
seat occupant.
Dealers will mail an owners manual update that describes the
location and proper use of the tether anchors. The recall began
on April 15,2005. For more details contact the Company by
Phone: 1-866-996-9463 or the NHTSA's auto safety hotline:
1-888-327-4236.
GEORGIA: Police Officer Lodges $100M Reverse Discrimination Suit
----------------------------------------------------------------
A police officer from the city of Unadilla, Georgia, initiated a
$100 million class action lawsuit against the city and its
officials claiming that his superiors discriminated against
white employees and routinely ordered them to reduce charges
against black people, The Associated Press reports.
Specifically, Officer Michael Smith sued 10 city officials for
$10 million each because of what he calls a pattern of reverse
discrimination. According to court documents, the conflict
stems from a February incident between Mr. Smith and a black
suspect. That incident had involved a black woman, who attempted
to elude arrest after a fight at a local nightclub. The woman
had allegedly rolled up a window on Mr. Smith's arm, and Mr.
Smith had to use his flashlight to break the window, free his
arm and arrest the suspect. The city, according to Mr. Smith's
suit, released the suspect and reduced the charges while he was
being treated for a fractured elbow, a separated shoulder and
back and nerve injuries.
The civil rights lawsuit alleges the city violated a law that
prohibits conspiracies to prevent an officer from performing his
duties based on race, and conspiracies to obstruct justice. It
also alleges that the city routinely drops or reduces charges
made by white officers while charges made by black officers to
white citizens are not dropped or reduced. As a class action,
the suit could involve a potential group of litigants composed
of all former white police officers with the city of Unadilla.
"We hope the citizens of Unadilla will demand of their elected
officials that the city work harder to remedy the current
situation against an officer who was merely doing his job and
trying to make the streets of Unadilla safer for everyone,"
Michelle Smith, the attorney representing the officer, told the
Cordele Dispatch.
HORIZON BLUE: Suit Filed Over Flawed Data Used To Set Low Rates
---------------------------------------------------------------
A proposed class action lawsuit is accusing New Jersey-based
Horizon Blue Cross Blue Shield of intentionally using flawed
data to set low reimbursement rates for medical care services,
The BI Daily News reports.
Filed in the Superior Court of New Jersey Law Division in Essex
County, the complaint also accused Ingenix Inc., a unit of
Minneapolis-based UnitedHealth Group Inc., of intentionally
providing the outdated and flawed data that Horizon used to set
reimbursement rates.
According to the complaint, Ingenix engaged in flawed and
incomplete methodology, analysis and data compilation methods to
develop the information it provided to Horizon. The complaint
further states that the data provided by Ingenix is not
reflective of reasonable rates for medical services in northern
New Jersey.
The complaint alleges that the plaintiff, Wayne Surgical Center
Inc., based in Wayne, New Jersey, has submitted numerous
requests for reimbursements for medical services and has
received inadequate reimbursements for these services from
Horizon due to the low reimbursement rates. In further alleges
that the Newark-based insurer knew that the information was
flawed, but continued to pay inadequate reimbursements with full
knowledge that the rates were unreasonable.
Court documents reveal that the lawsuit will seek certification
as a class action of all out-of-network providers in northern
New Jersey who obtained inadequate reimbursements for providing
care, treatment, supplies or other services to Horizon members.
But, according to Neil Prupis, a lawyer for the plaintiff with
West Orange, New Jersey-based Lampf, Lipkind, Prupis & Petigrow,
the lawsuit does not ask for a specific damage amount because
that will be determined during the discovery phase.
In a press statement, the plaintiff said Horizon has accumulated
$1 billion in cash while underpaying the out-of-network
providers for the services rendered.
INTERSIL CORPORATION: NY Court Preliminarily Approves Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Intersil
Corporation and certain of the Company's present officers and
directors as well as our lead initial public offering
underwriter and lead underwriter of the Company's September 2000
initial public offering, Credit Suisse First Boston Corporation.
Several suits were initially filed, the first of which is a
class action filed on June 8, 2001 in the United States District
Court for the Southern District of New York. The complaints
allege violations of Rule 10b-5 based on, among other things,
the dissemination of statements containing material
misstatements and/or omissions concerning the commissions
received by the underwriters of the initial public offering, as
well as failure to disclose the existence of purported
agreements by the underwriters with some of the purchasers in
these offerings to thereafter buy additional shares of Intersil
in the open market at pre-determined prices above the offering
prices.
These lawsuits against the Company, as well as those alleging
similar claims against other issuers in initial public
offerings, have been consolidated for pre-trial purposes with a
multitude of other securities related suits. In April 2002, the
plaintiffs filed a consolidated amended complaint against the
Company and certain of its officers and directors. The
consolidated amended complaint pleads claims under both the 1933
Securities Act and under the 1934 Securities Exchange Act. In
addition to the allegations of wrongdoing described above,
plaintiffs also now allege that analysts employed by
underwriters who were acting as investment bankers for the
Company improperly touted the value of its shares during the
relevant class period as part of the purported scheme to
artificially inflate the value of the Company's shares.
In October 2002, the individual employee defendants were
dismissed from the class action suit. The plaintiffs seek
unspecified damages, litigation costs and expenses. A tentative
settlement has recently been reached between the plaintiffs and
all defendant stock issuers, with ongoing negotiations as to the
specific terms of the settlement agreement. Under that
agreement, the Company would not be required to pay any damages,
expenses or litigation costs to the plaintiffs. When
negotiations are completed and the parties have agreed upon the
final terms of the settlement agreement, the agreement must be
approved by the court before dismissal of the Company and other
parties to the agreement from the suit. On February 15, 2005,
the Judge preliminarily approved the issuer's settlement
agreement. Final approval is subject to certain revisions
requested by the Judge, notice to the affected class members,
and a final hearing.
The suit is styled "In re Intersil Corporation Initial Public
Offering Securities Litigation, 1:01-cv-09798-SAS," related to
"In re Initial Public Offering Securities Litigation, 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York, under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(3) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
MAGEE-WOMENS: PA Court Sides With Hospital in Pap Smear Lawsuit
---------------------------------------------------------------
State Superior Court in Pennsylvania affirmed a lower court
decision dismissing a proposed class action suit by two local
women against Magee-Womens Hospital for alleged mishandling of
Pap smear reports, The Pittsburgh Post-Gazette reports.
Filed by Christine Walter of Sewickley and Sharon King of West
Deer, the suit accused Magee of using physician auto signatures
to intentionally mislead patients into believing a physician had
reviewed the test results. Common Pleas Judge Robert Horgos
threw out the case a year ago, saying the two women had not
shown any harm occurred, a decision which the Superior Court
panel affirmed.
In the ruling Judge Patrick R. Tamilia wrote, "Although the
presence of reproduced signatures on cytotechnologist-reviewed
Pap smear reports were slightly misleading, we cannot conclude
appellants' reliance on the reports was the proximate cause of
their alleged injury -- the cost of medical retesting."
Even with the court recent decision, attorney Joseph Podraza
Jr., legal counsel for Ms. Walter and Ms. King, indicated that
they would appeal the decision or ask for reconsideration. "This
is too serious a matter to end at this juncture," he told The
Pittsburgh Post Gazette. He also said that while his clients
have been retested and found to be disease-free, "nothing has
been done to directly notify other women [tested at Magee] that
there is a possible problem, and that is disheartening."
Meanwhile, in a press statement, University of Pittsburgh
Medical Center spokeswoman Jane Duffield said that the hospital
is calling the court's decision as "further confirmation that
the accusations of the plaintiffs in this case were not only
groundless, but also irresponsible," the Post-Gazette reports.
Ms. Duffield adds, "In fact, as now two courts have confirmed,
the only thing the plaintiffs in this class-action suit had to
show as a result of their treatment at Magee is their own good
health. There is, and has never been, any reason to doubt the
high quality of services provided by Magee-Womens Hospital."
MCCOWN DE LEEUW: Trustee Doubts Validity of Ex-Workers ID Suit
--------------------------------------------------------------
Questions have been raised about the validity of a class-action
lawsuit launched by former CEDU employees against McCown, De
Leeuw & Co. (MDC), as it wasn't filed in Delaware, Brown
Schools' bankruptcy trustee George Miller told The Bonner County
Daily Bee.
Mr. Miller, a tax accountant by profession told The Bonner
County Daily Bee, "You got to file it in Delaware. If it's not
filed in Delaware, we don't have to respond to it." He also
adds, "Any lawsuit against the bankrupt organization ... in my
opinion has to be brought in bankruptcy court."
However, the prosecuting attorney for the class-action lawsuit,
Robert S. Banks, said the lawsuit was valid. He told the Daily
Bee, "We don't have anything to do with a bankruptcy. We're not
suing the Brown Schools. We're suing MDC and that is our only
defendant. I don't see how the bankruptcy court could have any
jurisdiction."
Mr. Banks maintains MDC is responsible for the abrupt closure of
the Brown Schools. He said, "We gathered the facts that we were
able to gather, and it sure looked to us like McCown (MDC) had a
significant amount of influence at the Brown Schools. It looks
like the company made the decision to close those schools
without notice." Furthermore, he adds, "I think it's a very good
case. When you have a third party controlling an employer and
actually ... making management decisions about how the employers
are to be operated ... then there is liability on that third
party."
As previously reported in the April 19, 2005 edition of the
Class Action Reporter, former CEDU Education/Brown School
employees, Douglas Marshall, Mason Jones, Curtis Hewston and
Doreen Dengris initiated a class action lawsuit against McCown
Deleeuw & Company, Inc. in US District Court, Coeur d'Alene,
Idaho on behalf of themselves and of similarly situated people.
The plaintiffs launched the suit based on the allegation that
McCown violated the WARN Act, which falls under Rule 23 of the
Federal Rules of Civil Procedure.
According to court papers, filed by the attorneys for the
plaintiffs, Reed & Giesa of Spokane, Washington and Banks Law
Office of Portland, Oregon, this rule states that any employer
of 100 or more people is prohibited from ordering a simultaneous
mass layoff without a 60-day notice.
The document further stated that former President of CEDU
Education, Fenton "Pete" Talbot, was one of three persons to
sign the Unanimous Written Consent of the Board of Directors of
Brown Schools, Inc. The Unanimous Written Consent authorized the
March 25, 2005, voluntary filing of bankruptcy petitions of each
member of the Brown School Enterprise, indicating that of McCown
controlled and effected the mass layoffs in violation of the
WARN Act.
NEOFORMA INC.: NY Court Preliminarily Approves Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Neoforma,
Inc., its chairman and chief executive officer, Robert Zollars,
its former chief financial officer, Frederick Ruegsegger and the
underwriters of its initial public offering (IPO) - Merrill
Lynch, Pierce, Fenner & Smith, Bear Stearns and FleetBoston
Robertson Stephens.
The suits were filed on behalf of those who purchased shares of
the Company's common stock from January 24, 2000 to December 6,
2000. These actions have since been consolidated, and a
consolidated amended complaint was filed in the Southern
District of New York on April 24, 2002. The amended complaint
alleges that the underwriters solicited and received
"undisclosed compensation" from investors in exchange for
allocations of stock in the Company's IPO, and that some
investors in the IPO allegedly agreed with the underwriters to
buy additional shares in the aftermarket to artificially inflate
the price of Company stock.
The Company, Mr. Zollars and Mr. Ruegsegger are named in the
suits pursuant to Section 11 of the Securities Act of 1933 and
Section 10(b) of the Securities Exchange Act of 1934, and Rule
10b-5 promulgated thereunder, for allegedly failing to disclose
in the IPO registration statement and prospectus that the
underwriters had entered into the arrangements described above.
The complaints seek unspecified damages.
Approximately 300 other issuers and their underwriters have had
similar suits filed against them, all of which are included in a
single coordinated proceeding in the Southern District of New
York. On July 1, 2002, the underwriter defendants moved to
dismiss all of the IPO allocation litigation complaints against
them, including the action involving the Company. On July 15,
2002, the Company, along with the other non-underwriter
defendants in the coordinated cases, also moved to dismiss the
litigation. Those motions were fully briefed on September 13
and September 27, 2002, respectively, and in February 2003, the
Court denied the Company's motion to dismiss. On October 9,
2002, all of the individual defendants, including Mr. Zollars
and Mr. Ruegsegger, were dismissed from the action without
prejudice. On June 30, 2003, the Company's board of directors
approved a proposed settlement for this matter, which is part of
a larger global settlement between the issuers and plaintiffs.
The acceptance of the settlement by the plaintiffs is contingent
on a number of factors, including the percentage of issuers who
approve the proposed settlement.
The Company has agreed to undertake other responsibilities under
the proposed settlement, including agreeing to assign away, not
assert, or release certain potential claims it may have against
its underwriters. Any direct financial impact of the proposed
settlement is expected to be borne by its insurers. On February
15, 2005, the Court issued an order preliminarily approving the
proposed settlement and scheduling a hearing to determine
whether to finally approve the settlement.
The suit is styled "In re Neoforma, Inc. Initial Public Offering
Securities Litigation, 1:01-cv-09798-SAS," related to "In re
Initial Public Offering Securities Litigation, 21 MC 92 (SAS),"
filed in the United States District Court for the Southern
District of New York, under Judge Shira A. Scheindlin. The
plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(3) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
NETRATINGS INC.: NY Court Preliminarily Approves Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval for the settlement of the
consolidated securities class action filed against NetRatings,
Inc. and certain of its officers and directors on behalf of
purchasers of its common stock alleging violations of federal
securities laws. The case is now "designated as In re
NetRatings, Inc. Initial Public Offering Securities Litigation,"
related to "In re Initial Public Offerings Securities
Litigation."
The case is brought purportedly on behalf of all persons who
purchased the Company's common stock from December 8, 1999
through December 6, 2000. The complaint names as defendants
NetRatings; two of the Company's former directors; and
investment banking firms that served as underwriters for its
initial public offering in December 1999. The Plaintiffs
electronically served an amended complaint on or about April 19,
2002.
The amended complaint alleges violations of Section 11 and 15 of
the Securities Act of 1933, and Section 10(b) of the Securities
Exchange Act of 1934, on the grounds that the prospectus
incorporated in the registration statement for the offering
failed to disclose, among other things, that:
(1) the underwriters had solicited and received excessive
and undisclosed commissions from certain investors in
exchange for which the underwriters allocated to those
investors material portions of the shares of the
Company's stock sold in the initial public offering,
and
(2) the underwriters had entered into agreements with
customers whereby the underwriters agreed to allocate
shares of the Company's stock sold in the initial
public offering to those customers in exchange for
which the customers agreed to purchase additional
shares of the stock in the aftermarket at pre-
determined prices.
The amended complaint also alleges that false analyst reports
were issued following the IPO. No specific damages are claimed.
The Company is aware that similar allegations have been made in
lawsuits relating to more than 300 other initial public
offerings conducted in 1999 and 2000. Those cases, including
the Company's case, have been consolidated for pretrial purposes
before the Honorable Judge Shira A. Scheindlin. On July 15,
2002, the Company (as well as the other issuer defendants) filed
a motion to dismiss the complaint. The motions were heard on
November 1, 2002. In February 2003, the judge granted the
motion to dismiss certain of the claims against the Company and
the two individual defendants and denied the motion to dismiss
certain other claims against the Company and the two individual
defendants.
In July 2004, the Company and the individual defendants accepted
a settlement proposal made to all of the issuer defendants.
Under the terms of the settlement, the plaintiffs will dismiss
and release all claims against participating defendants in
exchange for a contingent payment guaranty by the insurance
companies collectively responsible for insuring the issuers in
all related cases, and the assignment or surrender to the
plaintiffs of certain claims the issuer defendants may have
against the underwriters. Under the guaranty, the insurers will
be required to pay the amount, if any, by which $1 billion
exceeds the aggregate amount ultimately collected by the
plaintiffs from the underwriter defendants in all the cases.
The settlement is subject to approval of the Court, which cannot
be assured.
The suit is styled "In re NetRatings, Inc. Initial Public
Offering Securities Litigation, 1:01-cv-09798-SAS," related to
"In re Initial Public Offering Securities Litigation, 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York, under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(i) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(ii) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(iii) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(iv) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(v) 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
(vi) 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
NEW JERSEY: Two Men Launch Suit Over Jail's Strip-Search Policy
---------------------------------------------------------------
Two men who claimed that they were strip-searched at the Camden
County Jail after being arrested on charges of failing to pay
fines for traffic violations and misdemeanors initiated a
federal suit claiming that the search policy is
unconstitutional, The Cherry Hill Courier Post reports.
Filed in U.S. District Court in New Jersey, the lawsuit requests
class-action status because of the large number of individuals
who also were strip-searched after being transferred to the jail
for "minor crimes of violations." It claims that the
Constitution bars detention without probable cause or an arrest
warrant and seeks unspecified compensatory and punitive damages.
The plaintiffs in the suit are Laverne Hicks of Texas, and
Michael Velez, identified only as a Camden County resident.
According to the lawsuit, New Jersey State Police arrested Mr.
Hicks in February in Camden, after being stopped on charges of
failing to wear a seat belt. When police checked for outstanding
warrants, a routine procedure at traffic stops, they found that
Mr. Hicks was delinquent in paying a fine for a traffic
violation and turned him over to the Camden Police Department.
The suit goes on to claim that although Mr. Hicks posted bail of
$168, he was still transferred to the jail, where he was strip-
searched, fingerprinted and photographed. The suit though does
not state how long Mr. Hicks was held at the jail.
On the other hand, Mr. Velez claims that state police in Camden
stopped him for a minor driving infraction in March 2004. When a
records search showed he had failed to pay a fine to a municipal
court, he was taken first to a state police barracks, the
lawsuit says. The suit further claims that Camden County
sheriff's officers transferred him to the jail, where Mr. Velez
was held overnight after being strip-searched.
The lawsuit comes as jail officials say they are working to
lessen overcrowding in the facility after two suicides by jail
inmates and the beating death of another within the last 15
months.
Ken Shuttleworth, spokesman for Camden County, told The Cherry
Hill Courier Post that county department heads and
administrators named as defendants in the lawsuit "will pass at
this time" on commenting on the lawsuit.
Court documents revealed that the lawsuit is asking U.S.
District Judge Joseph H. Rodriguez, to whom the case is assigned
for trial, to issue both a preliminary and permanent injunction
against detention of people charged with minor crimes or
municipal violations. It further asks the judge to prohibit
strip-searching of prisoners unless there is suspicion they are
carrying contraband or weapons.
If given class action status, the lawsuit says, it could affect
hundreds of people including many who "are low-income persons,
may not speak English, may not know of their rights, and likely
would have great difficulty in pursuing their rights
individually."
OPENTV CORPORATION: NY Court Preliminarily OKs Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against OpenTV
Corporation, certain of its officers and directors and the
underwriters for its initial public offering.
In July 2001, the first of a series of putative securities class
actions, styled "Brody v. OpenTV Corp., et al.," was filed in
United States District Court for the Southern District of New
York. These lawsuits were consolidated and are captioned
"In re OpenTV Corp. Initial Public Offering Securities
Litigation."
The complaints allege undisclosed and improper practices
concerning the allocation of the Company's initial public
offering shares, in violation of the federal securities laws,
and seek unspecified damages on behalf of persons who purchased
OpenTV Class A ordinary shares during the period from November
23, 1999 through December 6, 2000. The Court has appointed a
lead plaintiff for the consolidated cases. On April 19, 2002,
the plaintiffs filed an amended complaint.
Other actions have been filed making similar allegations
regarding the initial public offerings of more than 300 other
companies. All of these lawsuits have been coordinated for
pretrial purposes as "In re Initial Public Offering Securities
Litigation." Defendants in these cases filed an omnibus motion
to dismiss on common pleading issues. Oral argument on the
omnibus motion to dismiss was held on November 1, 2002. All
claims against the Company's officers and directors have been
dismissed without prejudice in this litigation pursuant to the
parties' stipulation approved by the Court on October 9, 2002.
On February 19, 2003, the Court denied in part and granted in
part the omnibus motion to dismiss filed on behalf of
defendants, including the Company. The Court's Order dismissed
all claims against us except for a claim brought under Section
11 of the Securities Act of 1933. The Court has given
plaintiffs an opportunity to amend their claims in order to
state a claim. Plaintiffs have not yet filed an amended
complaint. Plaintiffs and the issuer defendants, including the
Company, have agreed to a settlement, in which plaintiffs will
dismiss and release their claims in exchange for a guaranteed
recovery to be paid by the insurance carriers of the issuer
defendants and an assignment of certain claims. A stipulation of
settlement for the claims against the issuer-defendants,
including the Company, has been submitted to the Court. On
February 15, 2005, the Court preliminarily approved the
settlement contingent on specified modifications.
The suit is styled "In re OpenTV Corporation Initial Public
Offering Securities Litigation," related to "In re Initial
Public Offering Securities Litigation, 21 MC 92 (SAS)," filed in
the United States District Court for the Southern District of
New York, under Judge Shira A. Scheindlin. The plaintiff firms
in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(3) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
PEC SOLUTIONS: Plaintiffs Appeal VA Securities Lawsuit Dismissal
----------------------------------------------------------------
The United States Fourth Circuit Court of Appeals heard
plaintiffs' appeal of a lower court's dismissal of a
consolidated class action filed against PEC Solutions, Inc. and
certain of its officers.
On March 18, 2003, several purported class action complaints
were filed against the Company and certain of its officers in
the United States District Court for the Eastern District of
Virginia. The complaints allege that between October 22, 2002
and March 14, 2003, the defendants made, or were aware of, false
and misleading statements which had the effect of inflating the
market price of the Company's common stock, in violation of
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
The complaints were consolidated into a single class action on
September 13, 2003.
The class action was dismissed by the District Court on January
28, 2004. The plaintiffs filed an appeal with the U.S. Court of
Appeals for the Fourth Circuit on September 30, 2004. Oral
arguments on the appeal were held on December 2, 2004, and the
Company is awaiting the appellate court's decision.
RAYTHEON COMPANY: Reaches $39M Settlement For ID Securities Suit
----------------------------------------------------------------
A proposed $39 million settlement has been reached with the
Raytheon Corporation (NYSE: RTN) in the case "Muzinich & Co.,
Inc. et al v. Raytheon Company, et al," according to attorneys
representing investors of Washington Group International, Inc.
The lawsuit was originally filed in June 2001, and charged
Raytheon and certain of its officers with violating federal
securities laws in connection with an April 2000 sale to
Washington Group International.
The suit alleged that Raytheon deliberately misrepresented the
financial condition of its Raytheon Engineers & Constructors
(RE&C) division in order to sell the division to Washington
Group International at an artificially inflated price. According
to the suit, the RE&C division had cost overruns of
approximately $700 million that were known to exist at the time
of sale, but were not disclosed to investors. The suit alleged
that as a result of these cost overruns and Raytheon's refusal
to reimburse Washington Group, Washington Group's stock
plummeted severely and the company ultimately sought protection
under bankruptcy laws.
Steve Berman, managing partner of Hagens Berman Sobol Shapiro
and lead attorney for the plaintiffs, said that this case had
substantial challenges to recovery, but the settlement
ultimately resulted in a victory for investors.
"We worked long and hard to unearth evidence of Raytheon's
actions and put pressure on the company," said Mr. Berman. "We
are pleased to see those efforts come to fruition, and feel that
this settlement rightly benefits the investors."
According to the terms of the proposed settlement, Raytheon
Corporation will pay $39 million to the settlement class of
shareholders who purchased WGI stock or bonds from April 17,
2000 through March 2, 2001.
The settlement is subject to certain conditions, including
approval by the court. Also, as part of the settlement
agreement, the Raytheon Corporation makes no admission of
wrongdoing.
RENT-A-CENTER: AR Court Grants Firm's Motion To Dismiss Lawsuit
---------------------------------------------------------------
The class action lawsuit against Rent-A-Center that alleged
violations of Arkansas' usury law has been dismissed, The RTO
Online reports.
According to Chris Korst, Senor Vice President and General
Counsel for Rent-A-Center, "We received word this morning that
our motion to dismiss the case has been granted." He explains,
"The suit claimed that our rental purchase transaction was
subject to the Arkansas Constitution's usury limit of 10%. The
court rejected that claim now for the 3rd time." The Court
recognized that rent to own transactions are governed by the
Arkansas [Rental Purchase Act] and are not subject to usury
limits, he adds.
A virtually identical suit is pending in Arkansas against Rent
Way. Mr. Korst adds, "I've been very gratified with the unity
that dealers in Arkansas have shown in working together to
protect our industry."
Rent A Center, Aaron Rents, RentWay, and the Arkansas Rental
Dealers Association (ARDA) have cooperated on this and other
recent Arkansas challenges at the state level. "This is another
example of how rental dealers can work together too make sure
that the right result is achieved," he adds.
SINA CORPORATION: Shareholders Launch Stock Fraud Lawsuits in NY
----------------------------------------------------------------
Sina Corporation and certain of its officers and directors face
multiple purported securities class actions complaints filed in
the United States District Court for the Southern District of
New York, following the Company's announcement of anticipated
financial results for the first quarter of 2005 ending on March
31, 2005.
The complaints seek unspecified damages on alleged violations of
federal securities laws during the period from October 26, 2004
to February 7, 2005. The complaints allege violations of the
federal securities laws through the issuance of false or
misleading statements during the class period covered. More
specifically, the Complaint alleges that the Company failed to
disclose and misrepresented the following material adverse
facts, known to defendants or recklessly disregarded by them:
(1) that the Company was increasingly relying on services
related to "fortune telling" advertising, like
horoscopes and astrology, in order to meet its earnings
forecasts and generate a positive revenue stream;
(2) that the Chinese government had clamped down on
"fortune telling" advertising and the resulting
clampdown on "fortune telling" advertising would have a
material effect on the Company's revenue stream;
(3) that China Mobile Communication Corp.'s recent change
in its billing process for multimedia messaging
services SINA provides to China Mobile subscribers had
a material effect on the Company's business; and
(4) that as a result of the above, the defendants' positive
statements about the growth and prospectus of SINA were
lacking in any reasonable basis when made.
Consolidation and the appointment of lead plaintiff are
currently pending in these purported class actions. The Company
intends to take all appropriate action in response to these
lawsuits, it stated in a disclosure to the Securities and
Exchange Commission.
The first identified complaint in the litigation is "Xianglin
Shi, et al. v. SINA Corporation, et al., case no. 05-CV-2268."
The suits are pending in the United States District Court for
the Southern District of New York, under Judge Kimba M. Wood.
The plaintiff firms in this litigation are:
(i) Brodsky & Smith, LLC, 11 Bala Avenue, Suite 39, Bala
Cynwyd, PA, 19004 Phone: 610.668.7987, Fax:
610.660.0450, E-mail: esmith@Brodsky-Smith.com;
(ii) Dyer & Shuman, LLP 801 East 17th Avenue, Denver, CO,
80218-1417 Phone: 303.861.3003, Fax: 800.711.6483, E-
mail: info@dyershuman.com
(iii) Glancy Binkow & Goldberg LLP (NY) 1501 Broadway, Suite
1416, New York, NY, 10036 Phone: (917) 510-000, Fax:
(646) 366-089, E-mail: info@glancylaw.com
(iv) Law Offices of Brian M. Felgoise, P.C., Esquire at 261
Old York Road, Suite 423, Jenkintown, PA, 19046 Phone:
215.886.1900, E-mail: securitiesfraud@comcast.net
(v) Milberg Weiss Bershad & Schulman LLP (New York), One
Pennsylvania Plaza, 49th Floor, New York, NY, 10119
Phone: 212.594.5300, Fax: 212.868.1229, E-mail:
info@milbergweiss.com
(vi) Schatz & Nobel, P.C. 330 Main Street, Hartford, CT,
06106 Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com
(vii) Schiffrin & Barroway, LLP 3 Bala Plaza E, Bala Cynwyd,
PA, 19004 Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(viii) Seeger Weiss LLP 40 Wall Street, The Trump Building ,
New York, NY, 10005 Phone: 212.584.0700,
(ix) Wechsler Harwood LLP 488 Madison Avenue 8th Floor, New
York, NY, 10022 Phone: 212.935.7400, E-mail:
info@whhf.com
STONEPATH GROUP: Faces Consolidated Securities Suit in E.D. PA
--------------------------------------------------------------
Stonepath Group, Inc. faces a consolidated securities class
action filed in the United States District Court for the Eastern
District of Pennsylvania, styled "In re Stonepath Group, Inc.
Securities Litigation, Civ. Action No. 04-4515." The suit also
names as defendants officers Dennis L. Pelino and Thomas L.
Scully and former officer Bohn Crain.
Eight purported class action complaints were initially filed
between September 24, 2004 and November 19, 2004, and later
consolidated. The plaintiffs initially sought to represent a
class of purchasers of the Company's shares between May 7, 2003
and September 20, 2004, and allege claims for securities fraud
under Sections 10(b) and 20(a) of the Securities Exchange Act of
1934. These claims were based upon the allegation that certain
public statements made during the period from May 7, 2003
through August 9, 2004 were materially false and misleading
because they failed to disclose that the Company's Domestic
Services operations had improperly accounted for accrued
purchased transportation costs. The plaintiffs sought
compensatory damages, attorneys' fees and costs, and further
relief as may be determined by the Court.
The Court has consolidated the eight lawsuits into a single
action and the lead plaintiff has filed an amended complaint.
The amended complaint seeks to represent a class of purchasers
of the Company's shares between March 29, 2002 and September 20,
2004 based upon public statements made during that period.
The suit is styled, "In re Stonepath Group, Inc. Securities
Litigation, case no. 2:04-cv-04515-SD," filed in the United
States District Court for the Eastern District of Pennsylvania,
under Judge Stewart Dalzell. Representing the plaintiffs are:
(1) Stephanie M. Beige, U. Seth Ottensoser, BERNSTEIN
LIEBHARD & LIFSHITZ, LLP 10 East 40th Street New York,
NY 10016 Phone: 212-779-1414
(2) Deborah R. Gross, Susan R. Gross, LAW OFFICES BERNARD
M. GROSS, PC 100 Penn Square West, Juniper & Market St.
John Wanamaker Bldg Suite 450, Philadelphia PA 19107
Phone: 215-561-3600 Fax: 215-561-3000 E-mail:
debbie@bernardmgross.com or susang@bernardmgross.com;
(3) Timothy J. Macfall, LAW OFFICES OF CURTIS V. TRINKO 310
Madison Avenue, 14th Floor, New York NY 10017;
Representing the Company are Kendra Lee Baisinger, Steven E.
Bizar, Thomas P. Manning, Howard D. Scher, BUCHANAN INGERSOLL PC
1835 Market St., 14th Floor, Philadelphia PA 19103 Phone:
215-665-3878 E-mail: baisingerkl@bipc.com, bizarse@bipc.com,
manningtp@bipc.com, scherhd@bipc.com.
SUPPORTSOFT, INC.: Goodkind Labaton Appointed Co-Lead Counsel
-------------------------------------------------------------
The law firm of Goodkind Labaton Rudoff & Sucharow LLP
("Goodkind Labaton") reports on recent updates in the class
action litigation filed in the United States District Court for
the Northern District of California, on behalf of persons who
purchased or otherwise acquired publicly traded securities of
SupportSoft, Inc. ("SupportSoft" or the "Company") (Nasdaq:SPRT)
between January 20, 2004 and October 1, 2004, inclusive, (the
"Class Period").
By order dated March 21, 2005, (the "order") Goodkind Labaton
was appointed by the Court to serve as Co-Lead Counsel for the
Class in the now consolidated action In re SupportSoft
Securities Litigation, Civil Action No. 04-CV-5222 (N.D. Cal.).
Goodkind Labaton continues to conduct an extensive investigation
into the allegations in the initial complaint. The firm expects
to file its amended complaint by April 21, 2005.
The initial actions filed against the Company allege that
Defendants violated the federal securities laws by issuing false
and misleading statements regarding the Company's sales and its
ability to execute. Specifically, the Company failed to disclose
that in fact its business was not materially different from
other enterprise software companies who had been experiencing a
downturn in business, that its customers were also implementing
additional hurdles making it difficult to gain approval for new
and expanded deals, and that it was experiencing execution
difficulties, ranging from implementation problems at customer
sites to client relationship issues.
The Company's October 4, 2004, press release indicated that, in
fact, it was very similar to other enterprise software vendors
and that it expected total revenues to be meaningfully below its
previous guidance. The Company then expected revenues to fall in
a range of $11.9 million to $12.3 million, versus previous
guidance of $16.7 million to $17.5 million. Shares reacted
negatively to the news, dropping a stunning 35.4%, from $9.62
per share to $6.21 per share and have never recovered. Insider
Defendants sold at least 350,000 of their own shares of
SupportSoft ahead of the bad news for proceeds in excess of
$3,000,000.
For more details, contact Joseph Sternberg, Esq. of The Law Firm
of Goodkind Labaton Rudoff & Sucharow LLP by Phone: 800-321-0476
or visit their Web site: http://www.glrslaw.com.
SUPPORTSOFT INC.: NY Court Preliminarily OKs Lawsuit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against SupportSoft,
Inc. and two of its officers.
In November 2001, a class action lawsuit was filed, alleging
that the Company's registration statement and prospectus dated
July 18, 2000 for the issuance and initial public offering of
4,250,000 shares of its common stock contained material
misrepresentations and/or omissions, related to alleged inflated
commissions received by the underwriters of the offering. Also
named as defendants in the lawsuit are:
(1) Radha Basu,
(2) Brian Beattie,
(3) Credit Suisse First Boston Corporation,
(4) Bear, Stearns & Co. Inc. and
(5) FleetBoston Robertson Stephens Inc.
The lawsuit seeks unspecified damages as well as interest, fees
and costs. Similar complaints have been filed against 55
underwriters and more than 300 other companies and other
individual officers and directors of those companies. All of the
complaints against the underwriters, issuers and individuals
have been consolidated for pre-trial purposes before U.S.
District Court Judge Scheindlin of the Southern District of New
York.
On June 26, 2003, the plaintiffs announced that a proposed
settlement between the issuer defendants and their directors and
officers had been reached. As a result of the proposed
settlement, which is subject to court approval, the Company
anticipates that its insurance carrier will be responsible for
any payments other than attorneys' fees prior to June 1, 2003.
On September 2, 2003, plaintiffs' executive committee advised
the court that the lead plaintiff in the action against the
company was unwilling to serve as a class representative, and
sought leave to seek a new class representative. On October 20,
2003, the Company was notified that a new class representative
would be substituted into the case against it, but its attempts
to formally confirm this substitution have not been successful.
At a court conference on March 4, 2004, plaintiffs' executive
committee advised the court that the negotiators for plaintiffs
and issuers have agreed on the terms of the settlement. During
mid-2004, the plaintiffs moved for preliminary approval of the
proposed settlement. After full briefing and argument, on
February 15, 2005, the court issued an opinion preliminarily
approving the proposed settlement, contingent upon modifications
being made to one aspect of the proposed settlement - the
proposed "bar order." The court ruled that it had no authority
to deviate from the wording of the Plaintiff's Securities Law
Reform Act of 1995 and that any bar order that may issue should
the proposed settlement be finally approved must be limited to
the express wording of 15 U.S.C. section 78u-4(f)(7)(A).
TOYOTA MOTOR: Recalls Tundra Pick-up Trucks Due To Crash Hazard
---------------------------------------------------------------
Toyota Motor North America, Inc. is cooperating with the
National Highway Traffic Safety Administration by voluntarily
recalling 5,726 Tundra pick-up trucks, model 2004-2005, equipped
with both vehicle stability control (VSC) and the TRD Dual
Exhaust systems.
The TRD Dual exhaust system met all clearance specifications on
models without VSC, however the driver's side exhaust located in
a position where contact between a brake line found only on
vehicles with VSC and the TRD Exhaust pipe might occur.
In this condition, the exhaust pipe flange may rub against the
right rear brake line, which could cause brake fluid leakage.
This could lead to an increase of vehicle stopping distance,
which could result in a crash.
Dealers will inspect and, if so equipped, will replace the TRD
dual exhaust system. During this replacement, the dealer will
also inspect the specific brake line to assure it has not been
damaged and replace it, if necessary. The recall is expected to
begin April 2005. For more details, contact the Company by
Phone: 1-800-331-4331 or contact the NHTSA's auto safety
hotline: 1-888-327-4236.
WESTER ENERGY: Settles Securities, Derivative Lawsuits in KS
------------------------------------------------------------
Westar Energy, Inc. (NYSE: WR), the largest electric utility in
Kansas, reached an agreement in principle to settle pending
shareholder securities class action and shareholder derivative
lawsuits related to actions that occurred under former
management. Under the terms of the settlement, the company will
make a payment of $1.25 million and the company's insurance
carriers will make a payment of $31.25 million.
"This is one more matter dealing with actions under former
management that we are relieved to have closed," Jim Ludwig,
vice president, public affairs, said.
The settlement amount, less legal fees for the plaintiffs'
counsel in amounts to be determined by the court, will be paid
to the plaintiffs in the securities class action lawsuit. The
settlement is subject to various conditions, including the
execution of definitive agreements and approval of the United
States District Court in Topeka, Kansas. Also as part of the
settlement, the company has agreed not to seek reimbursement
from its insurance carriers for past or future legal costs
related to these lawsuits or the criminal proceedings against
certain of the company's former executives. The settlement does
not prevent the company from seeking reimbursement from those
former executives of legal expenses advanced to them or on their
behalf following the conclusion of relevant proceedings.
Both the securities class action lawsuit and the shareholder
derivative lawsuit were related to the matters covered by the
report of the Special Committee of the Board of Directors
released in May 2003.
The settlement does not include an admission of liability by the
company or any of the individual defendants. The company entered
into the settlement agreement to eliminate uncertainties related
to these lawsuits and the burden and expense of further
protracted litigation. The settlement does not include the
pending class action lawsuit related to the company's 401(k)
savings plan.
This settlement does not prevent the company from pursuing its
claims against certain of its former executives in arbitration
and has no impact on the criminal prosecution of them by the
United States Attorney's Office.
WINK COMMUNICATIONS: NY Court Preliminarily Approves Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Wink
Communications, Inc., two of its officers and directors and
certain investment banks which acted as an underwriter for the
Company's initial public offering.
In November 2001, a putative securities class action was filed
and is now captioned "In re Wink Communications, Inc. Initial
Public Offering Securities Litigation." The operative amended
complaint alleges undisclosed and improper practices concerning
the allocation of the Company's initial public offering shares
in violation of the federal securities laws, and seeks
unspecified damages on behalf of persons who purchased the
Company's common stock during the period from August 19, 1999
through December 6, 2000.
This action has been consolidated for pretrial purposes as "In
re Initial Public Offering Securities Litigation." On February
19, 2003, the Court ruled on the motions to dismiss filed by all
defendants in the consolidated cases. The Court denied the
motions to dismiss the claims under the Securities Act of 1933,
granted the motion to dismiss the claims under Section 10(b) of
the Securities Exchange Act of 1934 against the Company and one
individual defendant, and denied that motion against the other
individual defendant.
A stipulation of settlement for the claims against the issuer
defendants has been submitted to and preliminarily approved by
the Court. There is no guarantee that the settlement will become
effective, as it is subject to a number of conditions, including
approval of the Court, which cannot be assured.
The suit is styled "In re Wink Communications, Inc. Initial
Public Offering Securities Litigation," related to "In re
Initial Public Offering Securities Litigation, 21 MC 92 (SAS),"
filed in the United States District Court for the Southern
District of New York, under Judge Shira A. Scheindlin. The
plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(3) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) 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
(6) 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
ZHONE TECHNOLOGIES: Asks NJ Court To Dismiss Securities Lawsuit
---------------------------------------------------------------
Zhone Technologies, Inc. asked the United States District Court
for the District of New Jersey to dismiss a securities class
action filed against Tellium, Inc. As a result of the Company's
merger with Tellium, Inc., it became a defendant in the lawsuit.
On various dates between approximately December 10, 2002 and
February 27, 2003, numerous class-action securities complaints
were filed against Tellium. On May 19, 2003, a consolidated
amended complaint representing all of the actions was filed.
The complaint alleges, among other things, that Tellium and its
then-current directors and executive officers, and its
underwriters, violated the Securities Act of 1933 by making
false and misleading statements or omissions in its registration
statement prospectus relating to the securities offered in the
initial public offering. The complaint further alleges that
these parties violated the Securities Exchange Act of 1934 by
acting recklessly or intentionally in making the alleged
misstatements and/or omissions in connection with the sale of
Tellium stock. The complaint seeks damages in an unspecified
amount, including compensatory damages, costs and expenses
incurred in connection with the actions and equitable
relief as may be permitted by law or equity.
On March 31, 2004, the Court granted Tellium's and the
underwriters' motions to dismiss the complaint and allowed the
plaintiffs to file a further amended complaint. On May 14,
2004, the plaintiffs filed a second consolidated and amended
complaint. On June 25, 2004, the Company, as Tellium's
successor-in-interest, and the underwriters again moved to
dismiss the complaint. The motions to dismiss have been fully
briefed, and the parties are awaiting the Court's decision on
the motions.
New Securities Fraud Cases
BLUE COAT: Lasky & Rifkind Lodges Securities Fraud Lawsuit in CA
----------------------------------------------------------------
The law firm of Lasky & Rifkind, Ltd., initiated a lawsuit in
the United States District Court for the Northern District of
California, on behalf of persons who purchased or otherwise
acquired publicly traded securities of Blue Coat Systems, Inc.
("Blue Coat" or the "Company") (NASDAQ:BCSI) between February
20, 2004 and May 27, 2004, inclusive, (the "Class Period"). The
lawsuit was filed against Blue Coat, Brian M. NeSmith and Robert
Verheecke ("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
Blue Coat and its executives failed to disclose or
misrepresented that the Company would be unable to maintain its
sequential rate of sales growth, that its operating costs were
increasing dramatically, and that its gross margin levels
attained in the third fiscal quarter of 2004 were unsustainably
high. Defendants maintained that gross margins would fall in the
68% to 69% range for the fiscal fourth quarter, when they knew
that this margin level was unrealistic. Shares of Blue Coat
rallied in reaction to the announcement of the Company's first
profitable quarter since inception as well as the projections to
$38.27 per share. Following the fiscal third quarter earnings
announcement, Defendants NeSmith and Verheecke began to sell
large amounts of shares, selling 127,877, and 21,400 shares
respectively. Shares continued to trade robustly until April 27-
29, 2004, when unexpectedly and not driven by Company specific
news, the shares dropped $10 per share on extraordinary volume.
Then on May 27, 2005, Blue Coat announced worse than expected
results for their fiscal fourth quarter, with sequential revenue
growth slowing to 10%, gross margins falling, and earnings below
analyst consensus estimates. Shares plummeted $11.45 in reaction
to the news to close at $27.80 per share. In the months
following this drop the Securities & Exchange Commission ("SEC")
opened an informal investigation into the Company regarding the
Company's fourth quarter earnings announcement. On April 7,
2005, the SEC upgraded the probe to "formal" status.
For more details, contact Lasky & Rifkind, Ltd. by Phone:
(800) 495-1868 or by E-mail: investorrelations@laskyrifkind.com.
GLAXOSMITHKLINE PLC: Schiffrin & Barroway Files Stock Suit in NY
----------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of all securities
purchasers of GlaxoSmithKline plc (NYSE: GSK) ("GSK" or the
"Company") between February 21, 2001 and August 5, 2004,
inclusive (the "Class Period").
The complaint charges GSK and Jean-Pierre Garnier 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 GSK misrepresented information concerning the
safety and efficacy of Paxil in children and
adolescents;
(2) that by withholding negative information about the
drug, GSK was able to hold on to its patent on Paxil
and prevented other manufacturers from marketing a less
expensive version of the drug;
(3) that as a result the Company's financial results were
materially inflated; and
(4) that shares of GSK were inflated throughout the Class
Period.
On August 5, 2004, The Wall Street Journal published an article
entitled "FDA Revisits Issue of Antidepressants for Youths --
New Analysis May Pressure Agency to Set Limit on Use Because of
Suicide Risk." The article confirmed that analysis of clinical-
trial data shows evidence of a link between antidepressant drugs
and suicidal tendencies among young people. On this news shares
of GSK fell $0.80 per share or 1.95 percent, on August 5, 2004,
to close at $40.18 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.
IMERGENT INC.: Cohen Milstein Lodges Securities Fraud Suit in UT
----------------------------------------------------------------
The law firm of Cohen, Milstein Hausfeld & Toll, P.L.L.C. has
filed a lawsuit on behalf of its client and on behalf of other
similarly situated purchasers of the securities of iMergent,
Inc. (AMEX:IIG)("iMergent" or the "Company") from November 30,
2004, and February 25, 2005, inclusive (the "Class Period"). The
lawsuit was filed in the United States District Court for the
District of Utah against defendants iMergent, Brandon B. Lewis,
Robert M. Lewis, Donald L. Danks, David L. Rosenvall, David T.
Wise, Peter Fredericks and Thomas Scheiner.
The complaint charges iMergent and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. iMergent is an e-services company headquartered in Orem,
Utah. The Complaint alleges that the Company failed to disclose
material defects with the operation of its software, and that
its sales practices violated the laws of many of the states
iMergent operates in. On February 22, 2005, the Texas Attorney
General filed a lawsuit against iMergent in support of a
nationwide roundup targeting the operators of fraudulent
business opportunities. The Texas Attorney General's complaint
alleged that the Company's wholly owned subsidiary,
StoresOnline.com, was selling defective storefront software and
service packages and extorting thousands of dollars in
additional "executive mentoring" fees from its customers in
violation of state law.
In response to the unexpected news, shares of iMergent fell
$3.33 per share or almost 15 percent, on Feb. 23, 2005, and
another $2.80 per share or 14.55 percent on Feb. 24, 2005, to
close at $16.45 per share.
On Feb. 25, 2005, additional information about iMergent's
financial condition was revealed. On that day, defendant Danks
stated at an investment conference that iMergent had been
selling software packages through installment contracts to
customers with subprime credit. Danks further stated that only
slightly more than half of the purchase price was eventually
collected from these subprime customers. Following the
revelation of this information iMergent's stock price fell even
further, closing at $16.06 per share.
For more details, contact Steven J. Toll, Esq. or Elena Takacs
of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. by Mail: 1100 New
York Avenue, N.W. West Tower -- Suite 500, Washington, D.C.
20005 by Phone: 888-240-0775 or 202-408-4600 or by E-mail:
stoll@cmht.com or etakacs@cmht.com.
KRISPY KREME: Keller Rohrback Launches ERISA Lawsuit in M.D. NC
---------------------------------------------------------------
The law firm of Keller Rohrback L.L.P. commenced a class action
in the United States District Court for the Middle District of
North Carolina against Krispy Kreme Doughnuts, Inc. ("Krispy
Kreme" or the "Company") (NYSE:KKD) for violations of the
Employee Retirement Income Security Act of 1974 ("ERISA").
The class action focuses on investments in KKD stock by the
Krispy Kreme Doughnut Corp. Retirement Saving Plan and the
Krispy Kreme Profit Sharing Stock Ownership Plan (the "Plans")
from January 1, 2003, through the present (the "Class Period").
Specifically, the Plaintiffs allege in the Complaint:
(1) that Defendants breached their fiduciary duties to
Plaintiffs in violation of ERISA by failing to
prudently and loyally manage the Plan's investment in
KKD stock by continuing to offer KKD stock as an
investment option when the stock no longer was a
prudent investment for participants' retirement
savings;
(2) that Defendants who communicated with participants
regarding the Plans' assets, or had a duty to do so,
failed to provide participants with complete and
accurate information regarding KKD stock sufficient to
advise participants of the true risks of investing
their retirement savings in KKD stock;
(3) that Defendants, responsible for the selection,
removal, and, thus, monitoring of the Plans'
fiduciaries, failed to properly monitor the performance
of their fiduciary appointees and remove and replace
those whose performance was inadequate; and
(4) that Defendants breached their duties and
responsibilities as co-fiduciaries in the manner and to
the extent set forth in the Complaint.
For more details, contact Brian Schiewe, Paralegal of Keller
Rohrback L.L.P. by Phone: 800-776-6044 by E-mail:
investor@kellerrohrback.com or visit their Web site:
http://www.erisafraud.comor http://www.seattleclassaction.com.
MBIA INC.: Spector Roseman Lodges Securities Fraud Lawsuit in NY
----------------------------------------------------------------
The law firm of Spector, Roseman & Kodroff, P.C. announces that
a securities class action lawsuit was commenced in the United
States District Court for the Southern District of New York, on
behalf of purchasers of the common stock of MBIA Inc. ("MBIA" or
the "Company") (NYSE: MBI) between August 5, 2003 through March
30, 2005, inclusive (the "Class Period").
The Complaint alleges that defendants violated the federal
securities laws by issuing materially false and misleading
statements contained in press releases and filings with the
Securities and Exchange Commission during the Class Period.
Specifically, the Complaint alleges that MBIA engaged in
fraudulent accounting for its reinsurance policies and related
services which artificially inflated its financial results in
order to conceal its massive losses and, at the same time, to
smooth its earnings. As alleged in the Complaint, the Company
conceded that it had materially overstated its financial results
for failure to properly account for a $70 million payment it
received pursuant to two reinsurance agreements with Converium
Holding AG (formally known as Zurich Re). The Company also
stated that as a result of the improper accounting, it would
have to restate its results for 1998 and subsequent years.
On November 18, 2004, MBIA issued a press release after the
market closed announcing that it had received subpoenas from the
SEC and the New York Attorney General seeking information about
non-traditional or loss mitigation insurance products developed,
offered, or sold to third parties since January 1, 1998. In
reaction to this news, the price of MBIA stock fell $1.72, or
2.7%, from its closing price of $61.46 per share on November 18,
2004 to close at $59.74 per share on November 19, 2004.
On March 8, 2005, MBIA announced that it would restate its
financial results for 1998 and subsequent years for failure to
properly account for the $70 million payment it received in 1998
pursuant to the two reinsurance agreements. On March 9, 2005,
the Company announced that it had received a subpoena from the
U.S. Attorney's Office for the Southern District of New York
relating to the Company's reinsurance agreements with Converium.
Finally, on March 30, 2005, the last day of the Class Period,
MBIA issued a press release after the close of the market
announcing that it had received additional subpoenas from the
SEC and the New York Attorney General requesting information
relating to
(1) the Company's accounting treatment of advisory fees;
(2) the Company's methodology for determining loss reserves
and case reserves;
(3) purchases of credit default protection on itself; and
(4) documents relating to Channel Reinsurance Ltd., a
reinsurance company of which MBIA is a 17.4% owner.
In reaction to this news, the price of MBIA stock dropped $4.36
per share, or 7.6%, from its closing price of $56.64 on March
30, 2005 to close at $52.28 on March 31, 2005, on trading volume
of 8.38 million shares.
For more details, contact Robert M. Roseman of Spector, Roseman
& Kodroff by Phone: +1-888-844-5862.
XYBERNAUT CORPORATION: Shepherd Finkelman Files Stock Suit in DE
----------------------------------------------------------------
The law firm of Shepherd, Finkelman, Miller & Shah, LLC filed a
lawsuit seeking class action status in the United States
District Court for the District of Delaware on behalf of all
persons (the "Class") who purchased the securities of Xybernaut
Corporation (Nasdaq: XYBRE) ("Xybernaut" or the "Company")
during the period March 27, 2003 and April 8, 2005 (the "Class
Period"). A copy of the Complaint may be obtained from the
Court, or you can call our offices toll free at either 866/540-
5505 or 877/891-9880 to speak with an attorney regarding this
matter and we will send you a copy of the Complaint.
The Complaint charges Xybernaut, Edward G. Newman, Steven A.
Newman, M.D., and Thomas D. Davis with violations of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder. More specifically, the Complaint
alleges that the Company omitted or misrepresented material
facts about its financial condition, business prospects, revenue
expectations and internal controls during the Class Period.
On March 14, 2005, Xybernaut announced that it was seeking an
extension of time within which to file its annual report with
the Securities and Exchange Commission ("SEC"). On March 31,
2005, after the close of trading, Xybernaut belatedly revealed
that it was in dire financial and regulatory straits. The
Company issued a press release that day, which stated, in part:
"Xybernaut Corporation (Nasdaq: XYBR) announced today that the
filing of its Form 10-K and other related reports for the year
ended December 31, 2004, anticipated to occur today, will be
further delayed, pending completion of an internal investigation
undertaken by its Audit Committee." The press release stated
that independent counsel had been engaged to assist in an
internal investigation of, "among other things, concerns brought
to the Audit Committee's attention relating to the internal
control environment of the Company, the propriety of certain
expenditures and the documentation of certain expenses of the
Chairman and CEO of the Company, the Company's transparency and
public disclosure process, the accuracy of certain public
disclosures, management's conduct in response to the
investigation, and the propriety of certain major transactions."
The press release further stated that the Company had received a
subpoena from the Northeast Regional Office of the SEC seeking
"documents and other information relating to the sale of Company
securities by any person identified as a selling shareholder in
any Company registration statement or other public filing."
On this news, the Company's share price, which at one time had
traded as high as $2.23 per share due to the Company's positive
press releases and false and misleading representations during
the Class Period, closed at $0.42 per share on March 31, 2005,
and then dropped further by almost fifty percent (50%), to close
at $0.24 per share on April 1, 2005.
On April 8, 2005, after the close of trading, Xybernaut
announced in a press release that "investors and others should
refrain from relying upon the Company's historical financial
statements... for the years ended December 31, 2002 and 2003,
and interim quarterly reports for the quarters ended March 31,
2003, June 30, 2003, September 30, 2003, March 31, 2004, June
30, 2004 and September 30, 2004." On the heels of this shocking
news, trading was again heavy and the Company's price per share
fell to $0.13 per share.
For more details, contact James E. Miller, Esq. by Phone:
+1-866-540-5505 or by E-mail: jmiller@classactioncounsel.com OR
James C. Shah, Esq. by Phone: +1-877-891-9880 or by E-mail:
jshah@classactioncounsel.com.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
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S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA. Glenn Ruel 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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
The CAR subscription rate is $575 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
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