/raid1/www/Hosts/bankrupt/CAR_Public/050519.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, May 19, 2005, Vol. 7, No. 98
Headlines
ABERCROMBIE & FITCH: CA Court Dismisses Wardrobing Policy Suit
ABERCROMBIE & FITCH: Employees File Overtime Suits in CA, OH, TN
ABERCROMBIE & FITCH: CA Court Approves Discrimination Settlement
ABERCROMBIE & FITCH: Securities Lawsuit Still Pending in S.D. NY
ACCUBUILT INC.: Recalls 51 2004-2005 Vans Due To Fire Hazard
ALFA LEISURE: Recalls 320 Gold See Ya Motorhomes For Fire Hazard
ALLSTATE INSURANCE: Certification Sought For KY Insurance Suit
APOLLO GROUP: Shareholders Commence Securities Fraud Suit in AZ
APOLLO GROUP: Discovery Proceeds in CA Teachers Overtime Lawsuit
BARNES & NOBLE: Plaintiffs File Amended Overtime Wage Suit in CA
BARNESANDNOBLE.COM: Court Gives Suit Settlement Final Approval
BRIO RESTAURANT: Servers Commence Lawsuit Over Withheld Tips
BRITISH CAPITAL: FTC Inks Settlement For Investment Fraud Suit
CAJOHNS FIERY: Recalls Sauces Due To Undeclared Ingredients
COMPUTER NETWORK: Shareholders Sue V. McDATA Merger in MN Court
COSINE COMMUNICATIONS: Tut Deal Terminated, Reviews Alternatives
CROSS ROADS: Recalls 131 2005 Vehicles Due To Crash Hazard
DANIER LEATHER: Superior Court Rules on 2004 Trial's Legal Costs
DECODE GENETICS: Plaintiffs Voluntarily Dismisses 2004 Lawsuits
DILLARDS INC.: Plaintiffs File Second Amended Suit in S.D. Ohio
DUCATI NORTH: Recalls 117 Motorcycles For Defect, Crash Hazard
DUCATI NORTH: Recalls 622 Motorcycles For Defect, Fire Hazard
EASYHOME LTD.: Quebec Superior Court OKs Settlement Agreement
FATBRAIN.COM: NY Court Preliminarily Approves Lawsuit Settlement
FIFTH THIRD: Agrees To Amend 2005 Federal Securities Settlement
GENERAL ELECTRIC: Subsidiary Chief Launches $450M Race Bias Suit
GLS CAPITAL: PA Court Mulls Certification For Taxpayer Lawsuit
HOT TOPIC: To Seek Dismissal For CA Jewelry Lead Exposure Suits
HOT TOPIC: Discovery Proceeds in CA Employees' Overtime Lawsuit
INRANGE TECHNOLOGIES: NY Court Preliminarily OKs Suit Settlement
KAISER VENTURES: Discovery Proceeds in CA Unfair Trade Lawsuit
KROGER CO.: EEOC Launches Sexual Discrimination Lawsuit in TX
LUIGINO'S INC.: Launches Suit V. WV Economic Development Agency
MARVELL TECHNOLOGY: NY Court Preliminarily OKs Suit Settlement
MERCEDES-BENZ USA: Recalls 7191 M-Class Cars Due To Crash Hazard
MICHAELS OF OREGON: Recalls 8T Belt Holsters Due To Injury Risk
NORTH DAKOTA: New Proceedings Ordered in Case Labor Department
PHIL LONG FORD: Car Buyer Lodges CO Suit Over Extras in Contract
PRICESMART INC.: Reaches Settlement For CA Securities Fraud Suit
ST. JAMES: Limited Partners Launch Securities Fraud Suit in TX
TURNSTONE SYSTEMS: NY Court Preliminarily OKs Lawsuit Settlement
VAN HOOL: Recalls 150 2000-01 Buses For Window Latching Defect
WATCHGUARD TECHNOLOGIES: Law Firm Sets Lead Plaintiff Deadline
New Securities Fraud Cases
DORAL FINANCIAL: Abraham Fruchter Lodges Securities Suit in NY
FINDWHAT.COM INC.: Brodsky & Smith Lodges Securities Suit in FL
FRIEDMAN BILLINGS: Glancy Binkow Lodges Securities Lawsuit in NY
FRIEDMAN BILLINGS: Milberg Weiss Lodges Securities Lawsuit in VA
MOLSON COORS: Brodsky & Smith Lodges Securities Fraud Suit in DE
MOLSON COORS: Charles J. Piven Files Securities Fraud Suit in DE
*********
ABERCROMBIE & FITCH: CA Court Dismisses Wardrobing Policy Suit
--------------------------------------------------------------
The coordinated class action filed against Abercrombie & Fitch
Co. over its "wardrobing" policy has been settled and dismissed.
Six actions were initially filed on behalf of purported classes
of employees and former employees of the Company alleging that
the Company required its associates to wear and pay for a
"uniform" in violation of applicable law. In each case, the
plaintiff, on behalf of his or her purported class, seeks
injunctive relief and unspecified amounts of economic and
liquidated damages.
Two of these cases, "Jennifer M. Solis v. Abercrombie & Fitch
Stores, Inc. and A&F California, LLC" and "Sarah Stevenson v.
Abercrombie & Fitch Co.," allege violations of California law
and were filed on February 10, 2003 and February 4, 2003 in the
California Superior Courts for Los Angeles County and San
Francisco County, respectively.
An answer was filed in the Solis case on March 26, 2003.
Pursuant to a Petition for Coordination, the Solis and the
Stevenson cases were coordinated by order issued November 17,
2003. On February 28, 2005, these cases were settled and
dismissed with prejudice as to the individual claims and without
prejudice as to the putative class claims. The settlement was
not material to the consolidated financial statements.
ABERCROMBIE & FITCH: Employees File Overtime Suits in CA, OH, TN
----------------------------------------------------------------
Abercrombie & Fitch Co. continues to face three actions filed in
California, Ohio and Tennessee, alleging violations of overtime
wage laws. In each action, the plaintiffs, on behalf of their
respective purported class, seek injunctive relief and
unspecified amounts of economic and liquidated damages.
The first suit, styled "Bryan T. Kimbell, Individually and on
Behalf of All Others Similarly Situated and on Behalf of the
Public v. Abercrombie & Fitch Stores, Inc.," was filed on July
10, 2002 in the California Superior Court for Los Angeles
County. The plaintiffs allege that California general and store
managers were entitled to receive overtime pay as "non-exempt"
employees under California wage and hour laws.
An answer was filed in the Kimbell case on September 4, 2002 and
the parties are in the process of discovery. The trial court
has ordered a class of store managers in California certified
for limited purposes.
The second suit, styled "Melissa Mitchell, et al. v. Abercrombie
& Fitch Co. and Abercrombie & Fitch Stores, Inc.," was filed on
June 13, 2003 in the United States District Court for the
Southern District of Ohio. The plaintiffs allege that assistant
managers and store managers were not paid overtime compensation
in violation of the Fair Labor Standards Act and Ohio law.
The defendants filed a motion to dismiss the Mitchell case on
July 28, 2003. The case was transferred from the Western
Division to the Eastern Division of the Southern District of
Ohio on April 21, 2004. The plaintiffs filed an amended
complaint to add Scott Oros as a named plaintiff on October 28,
2004. The defendants subsequently renewed their motion to
dismiss, which was denied as to the two original plaintiffs and
remains pending as to certain claims of Plaintiff Oros. The
parties have commenced discovery.
The last suit, styled "Casey Fuller, Individually and on Behalf
of All Others Similarly Situated v. Abercrombie & Fitch Stores,
Inc.," was filed on December 28, 2004 in the United States
District Court for the Eastern District of Tennessee. The
plaintiff alleges that he and other similarly situated assistant
managers and managers in training were not paid properly
calculated overtime during their employment and seeks overtime
pay under the Fair Labor Standards Act. The defendant filed an
answer on February 7, 2005.
ABERCROMBIE & FITCH: CA Court Approves Discrimination Settlement
----------------------------------------------------------------
The United States District Court for the Northern District of
California granted final approval to the settlement of three
employee class actions filed against Abercrombie & Fitch Co.,
alleging discrimination in in hiring or employment decisions due
to race, national origin and/or gender.
The first suit, styled "Eduardo Gonzalez, et al. v. Abercrombie
& Fitch Co.," was filed on June 16, 2003 in the United States
District Court for the Northern District of California. The
plaintiffs subsequently amended their complaint to add A&F
California, LLC, Abercrombie & Fitch Stores, Inc. and A&F Ohio,
Inc. as defendants. The plaintiffs allege on behalf of their
purported class that they were discriminated against in hiring
and employment decisions due to their race and/or national
origin. The plaintiffs seek, on behalf of their purported class,
injunctive relief and unspecified amounts of economic,
compensatory and punitive damages.
A second amended complaint, which added two additional
plaintiffs, was filed on January 9, 2004. The defendants filed
an answer to the second amended complaint on January 26, 2004. A
third amended complaint was filed on June 10, 2004, restating
the original claims and adding two individual, but not class,
claims of gender discrimination. The defendants filed an answer
on June 21, 2004. On November 8, 2004, the plaintiffs filed a
fourth amended complaint, adding an additional plaintiff and
claims on behalf of those who asserted they were discriminated
against in hiring and employment decisions as managers due to
their race and/or national origin. On November 11, 2004, the
defendants answered the fourth amended complaint.
Two other class action employment discrimination lawsuits have
been filed in the United States District Court for the Northern
District of California, both on November 8, 2004. In "Elizabeth
West, et al. v. Abercrombie & Fitch Stores, Inc., et al.," the
plaintiffs allege gender (female) discrimination in hiring or
employment decisions and seek, on behalf of their purported
class, injunctive relief and unspecified amounts of economic,
compensatory and punitive damages. The other was brought by the
Equal Employment Opportunity Commission (the "EEOC") and alleges
race, ethnicity and gender (female) discrimination in hiring or
employment decisions. The EEOC complaint seeks injunctive relief
and, on behalf of the purported class, unspecified amounts of
economic, compensatory and punitive damages.
On November 8, 2004, the Company signed a consent decree
settling these three related class action discrimination
lawsuits, subject to judicial review and approval. The monetary
terms of the consent decree provide that the Company will set
aside $40.0 million to pay to the class, approximately $7.5
million for attorneys' fees, and approximately $2.5 million for
monitoring and administrative costs to carry out the settlement.
As part of the consent decree, the Company also agreed to
implement a series of programs and initiatives that are designed
to achieve greater diversity throughout its stores.
The Consent Decree (settlement agreement) contains provisions
related to the recruitment, hiring, job assignment, training,
and promotion of Abercrombie & Fitch, Hollister, and abercrombie
kids employees. The Decree is effective immediately, pursuant to
the Court's order. An appointed Monitor will regularly evaluate
and report on Abercrombie's compliance with the provisions in
the Consent Decree. These provisions include:
(1) "Benchmarks" for hiring and promotion of women,
Latinos, African Americans, and Asian Americans. These
benchmarks are goals, rather than quotas, and the
Company will be required to report on its progress
toward these goals at regular intervals;
(2) A prohibition on targeting fraternities, sororities, or
specific colleges for recruitment purposes;
(3) Advertising of available positions in publications
targeting minorities of both genders;
(4) A new Office and Vice President of Diversity,
responsible for reporting to the CEO on the Company's
progress toward fair employment practices (the Office
has already been created, and the VP has been hired and
begun work);
(5) The hiring of 25 recruiters who will focus on and seek
women and minority employees. (At least 24 of the 25
have already been hired, and are working.);
(6) Equal Employment Opportunity (EEO) and Diversity
Training for all employees with hiring authority;
(7) Revision of Performance Evaluations for managers,
making progress toward diversity goals a factor in
their bonuses and compensation;
(8) A new internal complaint procedure; and
(9) Company marketing materials will reflect diversity by
including members of minority racial and ethnic groups
The preliminary approval order was signed by Judge Susan Illston
of the United States District Court for the Northern District of
California on November 16, 2004, and that order scheduled a
final fairness and approval hearing for April 14, 2005.
The suit is styled "Gonzalez et al v. Abercrombie & Fitch Co. et
al., case no. 3:03-cv-02817," filed in the United States
District Court for the Northern District of California, under
Judge Susan Illston. Representing the Company is Thomas Brennan
Ridgley of Vorys Sater Seymour & Pease LLP, 52 East Gay Street,
P.O. Box 1008 Columbus, OH 43216-1008 Phone: (614) 464-6229 Fax:
614-464-6350 E-mail: tbridgley@vssp.com. Lead counsel for the
plaintiffs is Thomas A. Saenz of the Mexican American Legal
Defense and Educational Fund, 634 South Spring Street, 11th
floor Los Angeles, CA 90014 Phone: 213/629-2512
Fax: 213/629-0266 E-mail: tsaenz@maldef.org.
ABERCROMBIE & FITCH: Securities Lawsuit Still Pending in S.D. NY
----------------------------------------------------------------
Abercrombie & Fitch Co. continues to face a consolidated
securities class action filed against it in the United States
District Court for the Southern District of New York, styled "In
re Abercrombie & Fitch Securities Litigation."
Twenty actions were initially filed against the Company and
certain of its officers and directors on behalf of a purported,
but as yet uncertified, class of shareholders who purchased the
Company's Class A Common Stock between October 8, 1999 and
October 13, 1999. These 20 actions have been filed in the United
States District Courts for the Southern District of New York and
the Southern District of Ohio, Eastern Division, alleging
violations of the federal securities laws and seeking
unspecified damages. On April 12, 2000, the Judicial Panel on
Multidistrict Litigation issued a Transfer Order transferring
the 20 pending actions to the Southern District of New York for
consolidated pretrial proceedings.
On November 16, 2000, the Court signed an Order appointing the
Hicks Group, a group of seven unrelated investors in the Company
securities, as lead plaintiff, and appointing lead counsel in
the consolidated action. On December 14, 2000, plaintiffs filed
a Consolidated Amended Class Action Complaint (the "Amended
Complaint") in which they did not name as defendants Lazard
Freres & Co. and Todd Slater, who had formerly been named as
defendants in certain of the 20 complaints.
The Company and other defendants filed motions to dismiss the
Amended Complaint on February 14, 2001. On November 14, 2003,
the motions to dismiss the Amended Complaint were denied. On
December 2, 2003, the Company moved for reconsideration or
reargument of the November 14, 2003 order denying the motions
to dismiss. The motions for reconsideration or reargument were
fully briefed and submitted to the Court on January 9, 2004. The
motions were denied on February 23, 2004.
The suit is styled "Krouner et al v. Abercrombie & Fitch, case
no. 1:00cv2914," filed in the United States District Court for
the Southern District of New York, under Judge Thomas P. Griesa.
Representing the Company are David S. Cupps and Philip A. Brown,
Vorys, Sater, Seymour & Pease, LLP, 52 East Gay Street,
Columbus, OH 43215 USA Phone: (614) 464-6400. Representing the
plaintiffs are:
(1) Mel E. Lifshitz, Sandy A. Liebhard and Stanley A.
Bernstein of Bernstein, Liebhard & Lifshitz, 274
Madison Avenue New York, NY 10016 USA, Phone: (212)
779-1414, E-mail: Lifshitz@bernlieb.com,
Bernstein@bernlieb.com or Liebhard@bernlieb.com
(2) Richard S Wayne and William K. Flynn, Strauss & Troy
The Federal Reserve Building 150 East Fourth Street,
Cincinnati, OH 45202 USA Phone: (513) 621-2120
(3) Samuel Howard Rudman, Lerach, Coughlin, Stoia, Geller,
Rudman & Robbins, LLP, 200 Broadhollow Road, Ste 406,
Melville, NY 11747 USA Phone: 631-367-7100 Fax: 631-
367-1173 E-mail: Srudman@cauleygeller.com
(4) Steven G. Schulman, Milberg Weiss Bershad & Schulman
LLP (NYC), One Pennsylvania Plaza, New York, NY 10119
USA Phone: 212-594-5300 Fax: 212-868-1229 Email:
Sschulman@milberg.com
ACCUBUILT INC.: Recalls 51 2004-2005 Vans Due To Fire Hazard
------------------------------------------------------------
Accubuilt, Inc. in cooperation with the National Highway Traffic
Safety Administration's Office of Defects Investigation (ODI) is
voluntarily recalling about 51 units of 2004-2005 Accubuilt
vans.
According to ODI, on certain handicap accessible vans built on
Ford E350 chassis with 6.0L diesel engines, Accubuilt adds an
additional positive lead wire from the dual vehicle batteries to
the mobility lift for operating power. The end connections for
the added power wire can become corded, which can cause
increased heat generation in the wire and can melt the plastic
coating and/or the plastic corrugated protective sheathing. As
a consequence, heat generation could potentially melt the wire
to connector joint and a fire could occur without prior notice.
To remedy this Blue Bird will mail replacement decals with
correct nomenclature for the brake dash-warning indicator light.
For more details, contact Accubuilt by Phone: 419-222-8608 or
the NHTSA Auto Safety Hotline: 1-888-327-4236.
ALFA LEISURE: Recalls 320 Gold See Ya Motorhomes For Fire Hazard
----------------------------------------------------------------
Alfa Leisure, Inc. is cooperating with the National Highway
Traffic Safety Administration by voluntarily recalling 320 Alfa
Gold See Ya motorhomes, models 2002-2005.
On certain Class A motor homes equipped with Vehicle Systems'
Aqua-hot and Hydro-hot water heaters, which use Webasto Burner
tubes, the burner tubes do not meet specifications and could
fail prematurely. The surface temperature of the exhaust tube
exiting from the heater can increase and could potentially
ignite combustible materials in or around the vehicle.
Vehicle Systems is conducting the owner notification and remedy
for this campaign. For more details, contact Vehicle Systems by
Phone: 1-800-685-4298 or Alfa Leisure by Phone: 1-800-373-3372
or contact the NHTSA's auto safety hotline: 1-888-327-4236.
ALLSTATE INSURANCE: Certification Sought For KY Insurance Suit
--------------------------------------------------------------
Attorneys are asking a judge to grant class action status to a
lawsuit filed by a Richmond woman, alleging Allstate Insurance
Co. forced claimants to file costly and time-consuming
litigation to get a fair offer for damage claims, The Associated
Press reports.
Geneva Hager, of Richmond, suffered neck and lower back injuries
after her vehicle was rear-ended by a truck insured by Allstate
in 1997. Court documents reveal that the insurance company paid
Ms. Hager $25,000, the policy limit for the truck's driver,
Thomas J. Lapointe Jr., more than five years ago. However, Ms.
Hager's attorneys argue it was only offered days after Fayette
Circuit Court Judge Thomas Clark set a trial date over her
claim. The attorneys further argue that Allstate did not act in
good faith and they question whether Allstate's protocol for
handling what the company calls "minor impact, soft tissue"
claims violates Kentucky's Unfair Claims Settlement Practices
Act.
The plaintiff's lawyers say Allstate illegally singles out cases
with about $1,000 in property damage, trains adjusters to assume
such wrecks can't result in severe injuries and drags out those
cases so claimants will give up. Allstate though contends that
it looks at each claim individually and that separating low-
impact wrecks is a legitimate way of weeding out fraudulent
claims. Defense attorney Mindy Barfield contended that Ms. Hager
and her attorneys are motivated by greed and started plotting a
lawsuit soon after the accident, AP reports.
Ms. Hager's attorneys asked the court to allow them to proceed
with an $800 million, class action lawsuit against the company.
The lawyers are seeking $6 million in damages for Ms. Hager
alone. Judge Clark however gave no indication at a hearing when
his decision might come. Ms. Hager's trial is scheduled for
September.
Ms. Hager's attorneys told AP that her case is proof that
Allstate does not negotiate in good faith. They add that her
injuries were so apparent the claim should have been settled
quickly. Instead, according to attorney Dale Golden of
Lexington, one of the attorneys, Allstate forced her to file a
lawsuit and dragged her claim out for 2 1/2 years. Mr. Golden
also said that such delaying tactics are part of a coordinated
strategy outlined in internal company documents that Allstate's
lawyers successfully argued to have sealed in court records.
Ms. Hager's lawyers projected excerpts of the internal
documents, which provide a blueprint for claims handling, on the
courtroom wall. The documents described claims handling as a
"zero-sum economic game" that Allstate must win and "others must
lose." Mr. Golden argued, "In order for Allstate to benefit, it
must take the money from the injured victims and it's got to put
it in its own pocket. That's exactly what Allstate set out to
do, and it made no bones about it."
He goes on to argue that executives knew hardball tactics would
result in more bad-faith lawsuits, but accepted that as a cost
of doing business since legal fees and damage awards would not
outpace cost savings. "They are manipulating the justice
system," he adds, according to AP. "They are taking advantage of
the people who are most vulnerable."
Allstate's lawyers vigorously defended the company's claims
handling, contending that it is a way to crack down on
fraudulent claims that drive up insurance premiums. Allstate's
lawyers also noted that Kentucky's Department of Insurance found
the practice to be legal. In addition, Allstate also accused
the plaintiff's lawyers of selectively quoting and distorting
its internal documents. Ms. Barfield said that Ms. Hager's
lawyer, Paul Kaplan, who is working with Mr. Golden on the case,
dragged out the claim by refusing to hand over medical records
of a prior medical condition. She also said that Allstate was
justified in originally classifying the wreck as a minor
accident, since Hager's vehicle only had a small dent on the
rear bumper. Allstate is also opposing Ms. Hager's motion to
seek class action status, saying her claim is not representative
of passengers in low-impact accidents. Ms. Barfield points out
that there are so many individual factors in each accident that
a class action lawsuit "would be a nightmare."
APOLLO GROUP: Shareholders Commence Securities Fraud Suit in AZ
---------------------------------------------------------------
Apollo Group, Inc. faces several securities class actions filed
in the United States District Court for the District of Arizona
on behalf of purchasers of the Company's stock between March 12,
2004, and September 14, 2004.
On approximately October 12, 2004, a class action complaint was
filed in the United States District Court for the District of
Arizona, captioned "Sekuk Global Enterprises et. al. v. Apollo
Group, Inc. et. al., Case No. CV 04-2147 PHX NVW." Plaintiff, a
shareholder of the Company who purchased its shares in August
and September of 2004, filed this class action on behalf of
itself and all shareholders of the Company who acquired their
shares, and seeks certification as a class and monetary damages
in unspecified amounts. Plaintiff alleges violations of
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934,
and Rule 10b-5 promulgated under the Exchange Act, by the
Company for its issuance of allegedly materially false and
misleading statements in connection with its failure to publicly
disclose the contents of the U.S. Department of Education's
program review report.
A second class action complaint making similar allegations was
filed on October 18, 2004, in the United States District Court
for the District of Arizona, captioned "Christopher Carmona et.
al. v. Apollo Group, Inc. et. al., Case No. CV 04-2204 PHX EHC."
A third class action complaint making similar allegations was
filed on October 28, 2004, in the United States District Court
for the District of Arizona, captioned "Jack B. McBride et. al.
v. Apollo Group, Inc. et. al., Case No. CV 04-2334 PHX LOA."
"Sekuk Global Enterprises et. al. v. Apollo Group, Inc. et. al.,
Case No. CV 04-2147 PHX NVW" is pending before Judge Neil V.
Wake. "Christopher Carmona et. al. v. Apollo Group, Inc. et.
al., Case No. CV 04-2204 PHX EHC" is pending before Judge Earl
H. Carroll. "Jack B. McBride et. al. v. Apollo Group, Inc. et.
al., Case No. CV 04-2334 PHX LOA" is pending before Judge
Lawrence O. Anderson. The plaintiff firms in this litigation
are:
(1) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com;
(2) Dyer & Shuman, LLP, 801 East 17th Avenue, Denver, CO,
80218-1417, Phone: 303.861.3003, Fax: 800.711.6483, E-
mail: info@dyershuman.com
(3) 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
(4) Robbins Umeda & Fink, LLP, 1010 Second Avenue, Suite
2360, San Diego, CA, 92101, Phone: 800-350-6003, E-
mail: info@ruflaw.com
(5) Schatz & Nobel, P.C., 330 Main Street, Hartford, CT,
06106, Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com
(6) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
APOLLO GROUP: Discovery Proceeds in CA Teachers Overtime Lawsuit
----------------------------------------------------------------
Discovery is proceeding in the class action filed against Apollo
Group, Inc. in the Superior Court of the State of California for
the County of Orange, captioned "Bryan Sanders et. al. v.
University of Phoenix, Inc. et. al., Case No. 03CC00430."
Plaintiff, a former academic advisor with University of Phoenix,
filed this class action on behalf of himself and current and
former academic advisors employed by the Company in the State of
California and seek certification as a class, monetary damages
in unspecified amounts, and injunctive relief. Plaintiff alleges
that during his employment, he and other academic advisors
worked in excess of 8 hours per day or 40 hours per week, and
contend that the Company failed to pay overtime. Three status
conferences have occurred and the parties are now in the process
of discovery. A continued status conference is scheduled for
June 6, 2005.
BARNES & NOBLE: Plaintiffs File Amended Overtime Wage Suit in CA
----------------------------------------------------------------
Plaintiffs filed an amended overtime class action against Barnes
& Noble, Inc. in the Superior Court of California, Orange
County.
A company employee filed the suit on March 14, 2003, alleging
that the Company improperly classified the assistant store
managers, department managers and receiving managers working in
its California stores as salaried exempt employees. The
complaint alleges that these employees spent more than 50
percent of their time performing non-exempt work and should have
been classified as non-exempt employees. The complaint alleges
violations of the California Labor Code and California Business
and Professions Code and seeks relief, including overtime
compensation, prejudgment interest, penalties, attorneys' fees
and costs.
On November 18, 2004, an amended complaint was filed alleging
that the Company improperly classified the music managers and
caf‚ managers working in its California stores as salaried
exempt employees.
BARNESANDNOBLE.COM: Court Gives Suit Settlement Final Approval
--------------------------------------------------------------
The Delaware Court of Chancery granted final approval to the
settlement of the consolidated securities class action filed
against barnesandnoble.com, Inc. (bn.com), its directors and
Barnes & Noble, Inc., styled "In re BarnesandNoble.com, Inc.
Shareholders Litigation, Consolidated Civil Action No. 042-N."
Following the November 7, 2003 announcement of Barnes & Noble,
Inc.'s proposal to purchase all of the outstanding shares of
bn.com's common stock at a price of $2.50 per share in cash,
fifteen substantially similar putative class action lawsuits
were filed by individual stockholders of bn.com against bn.com,
bn.com's directors and Barnes & Noble. The complaints in these
actions, which purported to be brought on behalf of all of
bn.com's stockholders excluding the defendants and their
affiliates, generally alleged:
(1) breaches of fiduciary duty by Barnes & Noble and
bn.com's directors,
(2) that the consideration offered by the Barnes & Noble
was inadequate and constituted unfair dealing and
(3) that Barnes & Noble, as controlling stockholder,
breached its duty to bn.com's remaining stockholders by
acting to further its own interests at the expense of
bn.com's remaining stockholders.
The complaints sought to enjoin the proposal or, in the
alternative, damages in an unspecified amount and rescission in
the event a merger occurred pursuant to the proposal. The suits
were later consolidated.
On February 23, 2005, the Court entered a Final Order and
Judgment approving a Stipulation of Settlement providing for,
among other things, the release of all claims of the plaintiffs
and other members of the class against defendants that were or
could have been asserted in the action or in any way arise out
of or in connection with the merger. The Stipulation of
Settlement also expressly provides that the defendants in the
action deny that they have committed any violation of law
whatsoever and are entering into the Stipulation of Settlement
solely to eliminate the burden, expense and distraction of
further litigation. It was further agreed that defendants would
pay or reimburse the costs of mailing. The settlement was made
contingent upon, among other things, the merger consideration
being $3.05 per share in cash and consummation of the merger,
which occurred on May 27, 2004. The Court also approved an
attorneys' fee award to plaintiffs' counsel in the amount of
$600,000, including costs.
BRIO RESTAURANT: Servers Commence Lawsuit Over Withheld Tips
------------------------------------------------------------
Servers at the Brio restaurant in Newport initiated a lawsuit
against their employer, alleging that it illegally withheld some
of their tips to pay other employees, The Kentucky Post reports.
Known as "tip pooling," such a practice is illegal in Kentucky,
and in fact in Brio Tuscan Grille at Newport on the Levee it has
been halted.
Scot Singleton of Cincinnati and Derrick Whittle of Newport, who
are both seeking class-action status on behalf of all present
and former Brio servers, brought the lawsuit in Campbell Circuit
Court, Kentucky. The employees allege that the restaurant has
not returned all of their lost wages.
According to the suit, since Brio opened in 2001, it required
servers to share 3 percent of their sales with other employees,
"in effect requiring the servers to pay the wages of Brio's
other employees." The suit states that the practice though was
halted earlier this year by virtue of an order by the state
Department of Labor. As a result of the Department of Labor's
ensuing investigation, Brio made settlement offers to servers
and other employees, the lawsuit adds.
The suit maintains that the amounts offered to the servers are
not enough to pay the lost wages. According to the lawsuit,
which was filed by attorneys Margo Grubbs and Sherrill Hondorf
of Covington, "The offers to settle ... are inadequate and do
not comport with the requirements of (the laws) requiring (Brio)
to make full payment to its current and former employees as a
result of its unlawful conduct." It further said, "The offers of
settle made to the plaintiffs and the members of the class
contain an adjustment for 'authorized deductions," which is
unexplained and is most likely incorrect or unlawful. If the
"authorized deduction" is for the payment of income taxes, it is
an unlawful and/or incorrect because Plaintiff and the members
of the class have already been taxed on these funds."
BRITISH CAPITAL: FTC Inks Settlement For Investment Fraud Suit
--------------------------------------------------------------
The Federal Trade Commission settled a complaint against a set
of California-based defendants whose telemarketers and
promotional brochures allegedly misled hundreds of consumers
about their ability to make big money by speculating on foreign
currency prices.
The Commission also charged the defendants with making a variety
of other misrepresentations, including how and when investors
could access their money, and that the defendants would not make
money unless the investors did. The stipulated court order
settling the FTC's complaint bars the defendant from making any
of the false claims put forward in their telemarketing and
written promotional pitches.
The stipulated order announced today settles the Commission's
charges against the following defendants: Michael Zelener,
individually and as an officer or director of corporate
defendants Amgine Corp., a Nevada corporation doing business as
(dba) British Capital Group (BCG); and Markham & Co., a Nevada
corporation dba British Capital Group Ltd. Neither of the
corporate defendants are currently in business, having been shut
down as a result of a lawsuit filed by the Commodities Futures
Trading Commission (CFTC) in June 2003.
According to the FTC, BCG used telemarketing boiler-rooms
staffed by associates Zelener hired to cold-call potential
investors. Investors were solicited to open trading accounts at
AlaronFX (AFX), a subsidiary of a large currency trading company
in Chicago, that is not named in the Commission action. BCG's
telemarketers allegedly told consumers that they could make
money by speculating on the movement of foreign currency prices,
so-called "forex" transactions, in which foreign currency
contracts are traded over-the-counter. However, most of the
customers BCG's telemarketers called were unsophisticated
investors who were not familiar with forex transactions. Also,
they were retail investors, unlike most forex investors who
trade in foreign currencies to balance the risks associated with
their other investments or to cover other foreign currency
trades.
During the solicitations, the FTC's complaint states, the
defendants' telemarketers made a range of misrepresentations, as
detailed below. The Commission also alleges that once the
telemarketers identified consumers who were interested in BCG's
solicitations, Zelener sent the potential investors information
packages that also contained misinformation, including
statements such as: "[Accounts] professionally managed 24 hours
a day" and "traders and analysts professionally supervise the .
. . account program on a 24 hour basis." The promotional
materials also falsely stated that investors would receive
monthly statements showing profits and losses, and that accounts
"have a high degree of liquidity," with funds "available to the
client on 48 hours notice." Finally, the FTC alleges that while
BCG told investors it would make no money unless they did, the
company was paid by AFX for every trade it solicited - for a
total of $1.4 million, while at the same time its customers lost
more than $1.46 million.
The Commission's complaint contains two counts. The first
alleges that the defendants made seven misrepresentations, each
of which violated the FTC Act. The second alleges that five of
these misrepresentations also violated the FTC's Telemarketing
Sales Rule (TSR). The seven alleged misrepresentations include
the following:
(1) that investors would make at least 10 percent profit
per month;
(2) that only 20 percent of the investor's equity would be
used for trading;
(3) that investors would be notified if their accounts fell
below a certain percentage equity;
(4) that investors would have 24-hour access to their
accounts;
(5) that investors would receive monthly statements;
(6) that investors could recover their balances quickly;
and
(7) that the defendants would not make money unless the
investors made money.
The consent order bars the defendants from making any of the
misrepresentations alleged in the FTC's complaint, and more
generally from violating the FTC Act or the TSR in the future.
It also contains specific reporting and compliance requirements
that will allow the Commission ensure the defendants meet the
conditions of the order.
The Commission vote to approve the complaint and consent order
was 5-0. The FTC filed the complaint and consent in the U.S.
District Court for the Northern District of Illinois, Eastern
Division, on May 9, 2005, and was entered by the court on May
10, 2005. The FTC gratefully acknowledges the support of the
CFTC in investigating this matter.
Copies of the complaint and stipulated final order are available
from the FTC's Web site at http://www.ftc.govand also from the
FTC's Consumer Response Center, Room 130, 600 Pennsylvania
Avenue, N.W., Washington, DC 20580. The FTC works for
the consumer to prevent fraudulent, deceptive, and unfair
business practices in the marketplace and to provide information
to help consumers spot, stop, and avoid them. To file a
complaint in English or Spanish (bilingual counselors are
available to take complaints), or to get free information on any
of 150 consumer topics, call toll-free, 1-877-FTC-HELP
(1-877-382-4357), or use the complaint form at
http://www.ftc.gov.The FTC enters Internet, telemarketing,
identity theft, and other fraud-related complaints into Consumer
Sentinel, a secure, online database available to hundreds of
civil and criminal law enforcement agencies in the U.S. and
abroad. For more details, contact Mitchell J. Katz, Office of
Public Affairs, by Phone: 202-326-2161 or David A. O'Toole, FTC
Midwest Region by Phone: 312-960-5601 or visit the Website:
http://www.ftc.gov/opa/2005/05/britishcapital.htm.
CAJOHNS FIERY: Recalls Sauces Due To Undeclared Ingredients
-----------------------------------------------------------
CaJohns Fiery Foods Company is voluntarily recalling 16-ounce
glass bottles and 1-gallon size plastic jugs of several brands
of barbeque sauces because they contain undeclared anchovies,
soybeans, and wheat. People who have allergies to these
ingredients run the risk of serious or life-threatening allergic
reaction if they consume these products.
The specific brands of barbeque sauces being recalled are
CaBoom! Bayou-Q Barbeque Sauce Spicy, CaBoom! Barbeque Sauce
Hot, CaBoom! Bayou-Q Barbeque Sauce X Hot, Gecko Gary's
Brushfire Spicy BBQ Sauce, Irish Scream BBQ Sauce, and HDH
Grillin' Sauce. All lot codes of these sauces are being recalled
for re-labeling.
The recalled barbeque sauces were distributed nationwide through
retailers, mail order and web sites.
The problem was discovered by US Food and Drug Administration
(FDA) officials during a routine inspection of the firm. CaJohns
Fiery Foods Company is working with the FDA on this recall. The
firm has suspended distribution of these products until a new
revised label listing the undeclared ingredients is acquired. No
illnesses have been reported to date in connection with this
problem.
Distributors and retailers that have these products should
immediately discontinue distribution and notify CaJohns Fiery
Foods Company for instructions on handling the recalled
products. Consumers or retailers with questions should contact
the manufacturer at 888-703-3473.
COMPUTER NETWORK: Shareholders Sue V. McDATA Merger in MN Court
---------------------------------------------------------------
Computer Network Technology Corporation and certain of its
directors face a class action filed in the District Court of
Hennepin County, State of Minnesota, styled "Jack Gaither v.
Thomas G. Hudson et al. (File No. MC 05-003129)."
The suit was filed following the announcement of the Company's
proposed merger with McDATA Corporation. The suit asserts
claims on behalf of a purported class of Company stockholders
and alleges claims of breach of fiduciary duty in connection
with the merger on the grounds that the defendants allegedly
failed to take appropriate steps to maximize the value of a
merger transaction for Company stockholders. Additionally, the
plaintiff claims that the defendants have made insufficient
disclosures in connection with the merger.
COSINE COMMUNICATIONS: Tut Deal Terminated, Reviews Alternatives
----------------------------------------------------------------
Equipment vendor CoSine Communications' proposed acquisition by
Tut Systems was terminated, because it was "unlikely to gain
shareholder approval, given current market conditions," The
Telephony Online reports.
The proposed acquisition was first announced in January, a stock
transaction valued at about $24.1 million, however a few days
later some CoSine shareholders filed a class action lawsuit to
try to stop the merger. Those shareholder had accused CoSine's
officers and directors of "self-dealing and breach of fiduciary
duties," charges the company denies.
In April, a group of CoSine shareholders led by Warren G.
Lichtenstein, who is the chairman and CEO of equipment vendor SL
Industries, urged the company not to complete the merger,
arguing that the Tut acquisition was not in the best interest of
CoSine investors, the group suggested the deal be terminated if
shareholders did not approve it by May 15.
In a filing with the U.S. Securities and Exchange Commission in
April, Mr. Lichtenstein's group, Steel Partners II wrote,
"CoSine should continue as a going concern and seek to acquire a
business so as to be able to utilize its cash on hand and take
advantage of its net operating loss carry-forwards."
In a press statement, CEO Terry Gibson said the company would
continue to review strategic alternatives. In its quarterly
report to the SEC, CoSine said, "Should the merger with Tut
Systems not be completed, we would continue to explore strategic
alternatives, including a sale of the company, a sale or
licensing of products, intellectual property, or a winding-up
and liquidation of the business and a return of capital."
CROSS ROADS: Recalls 131 2005 Vehicles Due To Crash Hazard
----------------------------------------------------------
Cross Roads, Inc. in cooperation with the National Highway
Traffic Safety Administration's Office of Defects Investigation
(ODI) is voluntarily recalling about 131 units of 2005 Cross
Road Cruisers and Zingers.
According to ODI, on certain vehicles equipped with RFD wheels,
there is a defective weld of the wheels' center hub to the
wheel's rim. This could result in a wheel separation, thus
increasing the risk of a crash.
As a remedy, RFD Components is conducting the owner notification
and remedy for this recall campaign.
For more details, contact RFD Components by Phone: 574-295-3939
or Cross Roads by Phone: 260-593-2866 or the NHTSA Auto Safety
Hotline: 1-888-327-4236.
DANIER LEATHER: Superior Court Rules on 2004 Trial's Legal Costs
----------------------------------------------------------------
The Superior Court of Justice in Ontario ruled in the matter or
costs regarding the trial in the class action filed against
Danier Leather Inc. (TSX:DL.SV) in 2004.
The class action concerned information contained in a financial
forecast issued by the Company during its initial public
offering ("IPO") in 1998. On May 7, 2004 the trial Judge
concluded that two senior officers of the Company had an honest
belief at the time the IPO closed that the forecast prepared
during the process could be achieved. The Judge further held
that the forecast was, in fact, substantially achieved. However,
the Court found that a proper review had not been done on the
date of closing and had it been done the Company should have
concluded that the forecasted results were not achievable, even
though the forecast was in fact substantially achieved. The
Judge held in favor of the plaintiffs and awarded damages to all
Canadian shareholders who had purchased shares in the IPO.
The trial Judge did not deal with the awarding of costs at that
time. A hearing in that regard was held in April 2005. In its
decision, the Court awarded a portion of the costs claimed by
the plaintiffs but referred the matter for assessment to
determine the amount of costs to be paid. The quantum of the
costs award will not be known until the final assessment ordered
by the Court has been conducted. Based on the information as of
this date, the Company estimates that this award, if unchanged
on appeal, would cost approximately $3 million to $4 million.
The Company's appeal hearing regarding the trial decision is
currently scheduled in June 2005. The Company also plans to
appeal certain aspects of the costs award. It is anticipated
that both appeals will be heard at the same time. The original
decision and the costs award are stayed pending the appeal.
The judgment in the class action and the award of costs are
joint and several responsibilities of the Company and of the two
officers in question. The Company carries directors and officers
insurance and expects that such insurance will cover the two
officers' portion of the total award. The amount of the
insurance is not readily determinable at this time and its
recovery, therefore, has not been accrued.
The Company anticipates having sufficient financial resources to
pay any anticipated award, interest, and costs associated with
these matters. Based solely on the information then available,
the Company established a provision of $15 million in this
regard during the fourth quarter of 2004. A review of this
provision will be made in the fourth quarter of 2005 based upon
this new information. Danier continues to maintain a strong
financial position with working capital of $44.8 million and no
long-term debt as at the end of its most recent quarter.
DECODE GENETICS: Plaintiffs Voluntarily Dismisses 2004 Lawsuits
---------------------------------------------------------------
The class action and derivative lawsuits filed against deCODE
genetics, Inc. (Nasdaq: DCGN) and certain of its officers and
directors in September and October 2004 have been voluntarily
dismissed by the plaintiffs. The plaintiffs did not receive any
payment or fees in connection with the dismissal of these suits.
As reported in previous editions of the Class Action Reporter,
law firms initiated class action suits in the United States
District Court for the Southern District of New York on behalf
of purchasers of deCODE genetics, Inc. publicly traded
securities during the period between October 29, 2003 and August
26, 2004.
The complaint charges deCODE and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. deCODE is a population genetics company developing drugs
and deoxyribonucleic acid (DNA)-based diagnostics, based upon
its discoveries in the inherited causes of common diseases.
The complaint alleges that during the Class Period, defendants
caused deCODE's shares to trade at artificially inflated levels
through the issuance of false and misleading statements,
including by concealing its continuing internal control
problems. As a result of this inflation, deCODE was able to
complete a public offering of $150 million worth of convertible
notes in April 2004, raising net proceeds of $144 million. Then,
on August 26, 2004, deCODE filed a Form 8-K with the SEC in
which it disclosed the resignation of its outside accountant and
disclosed a "reportable condition" with respect to deCODE's
closing procedures. On this news, deCODE's stock collapsed to
$5.70 per share, 58% below the Class Period high of $13.80 per
share.
DILLARDS INC.: Plaintiffs File Second Amended Suit in S.D. Ohio
---------------------------------------------------------------
Plaintiffs filed a second amended class action against Dillards,
Inc. in the United States District Court for the Southern
District of Ohio. The suit also names as defendants the
Mercantile Stores Pension Plan and the Mercantile Stores Pension
Committee and was filed on behalf of a putative class of former
Plan participants.
The complaint alleges that certain actions by the Plan and the
Committee violated the Employee Retirement Income Security Act
of 1974, as amended (ERISA), as a result of amendments made to
the Plan that allegedly were either improper and/or ineffective
and as a result of certain payments made to certain
beneficiaries of the Plan that allegedly were improperly
calculated and/or discriminatory on account of age. The Second
Amended Complaint does not specify any liquidated amount of
damages sought and seeks recalculation of certain benefits paid
to putative class members. No trial date has been set.
The suit is styled "Christnacht, et al v. Dillards Inc, et al,
case no. 1:00-cv-00488-SSB-JS," filed in the United States
District Court for the Southern District of Ohio, under Judge
Sandra S. Beckwith. The plaintiffs were represented by Stanley
Morris Chesley and Terrence Lee Goodman, Waite Schneider Bayless
& Chesley Co LPA 1513 Fourth & Vine Tower One West Fourth Street
Cincinnati, OH 45202 Phone: 513-621-0267 E-mail:
stanchesley@wsbclaw.cc, or terrygoodman@wsbclaw.com.
Representing the Company are Michael Devanney Eagen and Gregory
Alan Harrison of Dinsmore & Shohl - 1, 1900 Chemed Center 255 E
5th Street, Cincinnati, OH 45202 Phone: 513-977-8200 E-mail:
michael.eagen@dinslaw.com or greg.harrison@dinslaw.com; and Gina
Marie Saelinger of Ulmer & Berne LLP, 600 Vine Street Suite 2800
Cincinnati, OH 45202 Phone: 513-977-8200 Fax: 513-977-8141
E-mail: gsaelinger@ulmer.com.
DUCATI NORTH: Recalls 117 Motorcycles For Defect, Crash Hazard
--------------------------------------------------------------
Ducati North America is cooperating with the National Highway
Traffic Safety Administration (NHTSA) by voluntarily recalling
117 motorcycles, namely:
(1) DUCATI / MTS 1000, model 2005
(2) DUCATI / MTS 620, model 2005
(3) DUCATI / S2 R, model 2005
(4) DUCATI / S4 R, model 2005
On certain motorcycles, the incorrect rear shock absorber rocker
arm was installed during production. The incorrect component
could potentially fail, causing the vehicle to crash without
prior warning.
Dealers will inspect the rear shock absorber rocker arm and
replace it if necessary. The manufacturer has not yet provided
an owner notification schedule for this campaign. For more
details, contact the Company by Phone: 408-253-0499 or the
NHTSA's auto safety hotline: 1-888-327-4236.
DUCATI NORTH: Recalls 622 Motorcycles For Defect, Fire Hazard
-------------------------------------------------------------
Ducati North America is cooperating with the National Highway
Traffic Safety Administration (NHTSA) by voluntarily recalling
622 motorcycles, namely:
(1) DUCATI / ST3, model 2004
(2) DUCATI / ST4S, model 2004
(3) DUCATI / ST4S ABS, model 2004
On certain motorcycles, the air box breather hose may come in
contact with the horizontal cylinder exhaust pipe. This will
create a potential fire hazard.
Dealers will shorten the air box breather hose securing it away
from the horizontal cylinder exhaust pipe. The manufacturer has
not yet provided an owner notification schedule. For more
information, contact the Company by Phone: 408-253-0499 or
contact the NHTSA by Phone: 1-888-327-4236.
EASYHOME LTD.: Quebec Superior Court OKs Settlement Agreement
-------------------------------------------------------------
The settlement agreement between Option Consommateurs, Madam
Deborah Ditchburn and easyhome Ltd. (TSX:EH) entered into on
November 22, 2004 that ends the litigation between the parties
was approved by the Quebec Superior Court.
The plaintiffs filed a class action suit on November 28, 1997
against easyhome Ltd. Option Consommateurs and Madam Ditchburn
contended, among other things, that the contract used by
easyhome Ltd. did not conform to the requirements of the Quebec
Consumer Protection Act. While denying any wrongdoing and
liability of any kind whatsoever in relation to the allegations
made by the plaintiffs, easyhome Ltd. considered it desirable to
settle the litigation in light of the extensive time commitments
required by its senior executives to defend the suit as well as
the costs necessary to defend the class action.
easyhome Ltd. customers in Quebec who are included in the
definition of Eligible Class Members, as defined in the
settlement agreement, will receive a cash payment by mail before
the end of this month.
Pursuant to the terms of the settlement agreement, easyhome Ltd.
will pay out a total sum of $547,512. Once the various expenses
have been paid, including the fees of the plaintiffs' attorneys
as authorized by the Court, approximately $298,000 will be
distributed amongst the Eligible Class Members. Management
recorded a reserve on its books in a prior year in an amount,
which is adequate to cover the liability of easyhome Ltd. under
the settlement agreement.
easyhome Ltd., with 147 locations, is Canada's largest
merchandise rental company and the fourth largest in North
America, offering top quality, brand-name household furnishings,
appliances and home electronic products to consumers under
weekly or monthly rental agreements.
For more details, contact Donald K. Johnson, Chairman of the
Board by Phone: (416) 359-4119 OR David Ingram, President and
Chief Executive Officer by Phone: (905) 272-2788 OR Bill Johnson
Executive Vice President & Chief Financial Officer by Phone:
(780) 930-3012, all of easyhome Ltd.
FATBRAIN.COM: NY Court Preliminarily Approves 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 Fatbrain.com,
LLC, a subsidiary of BarnesandNoble.com, Inc. The suit also
names certain of the Company's officers and the underwriters of
its initial public offering (IPO).
The suit has been consolidated with other litigation in "In Re
Initial Public Offering Securities Litigation" filed in the U.S.
District Court, Southern District of New York in April 2002 (the
Action), naming over one thousand individuals and 300
corporations, including the Company.
The amended complaint alleges that the initial public offering
registration statements filed by the defendant issuers with the
SEC, including the one filed by the Company, were false and
misleading because they failed to disclose that the defendant
underwriters were receiving excess compensation in the form of
profit sharing with certain of its customers and that some of
those customers agreed to buy additional shares of the defendant
issuers' common stock in the after market at increasing prices.
The amended complaints also allege that the foregoing constitute
violations of:
(1) Section 11 of the Securities Act of 1933, as amended
(the 1933 Act) by the defendant issuers, the directors
and officers signing the related registration
statements, and the related underwriters;
(2) Rule 10b-5 promulgated under the Securities Exchange
Act of 1934 (the 1934 Act) by the same parties; and
(3) the control person provisions of the 1933 and 1934 Acts
by certain directors and officers of the defendant
issuers.
A motion to dismiss by the defendant issuers, including the
Company, was denied. After extensive negotiations among
representatives of plaintiffs and defendants, a memorandum of
understanding (MOU), outlining a proposed settlement resolving
the claims in the Action between plaintiffs and the defendants
issuers, has been entered into. Subsequently a settlement
agreement was executed between the defendants and plaintiffs in
the action, the terms of which are consistent with the MOU.
The Settlement Agreement was submitted to the Court for approval
and on February 15, 2005, the judge granted preliminary approval
of the settlement, subject to certain modifications. The
proposed settlement is expected to be funded by the defendants'
insurance companies.
The suit is styled "IN RE FATBRAIN.COM, LLC. INITIAL PUBLIC
OFFERING SECURITIES LITIGATION," filed in relation to "IN RE
INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File No.
21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. 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
FIFTH THIRD: Agrees To Amend 2005 Federal Securities Settlement
---------------------------------------------------------------
Fifth Third Bancorp agreed to amend the federal securities
settlement that it previously announced on April 1, 2005, to
make it clear that claims brought under the Employee Retirement
Income Security Act (ERISA) on behalf of employee and retiree
participants in the Company's 401(k) plan will not be covered by
the securities settlement, the law firm of Scott + Scott, LLC
announced in a statement.
The ERISA claims are the subject of a separate class action
lawsuit against Fifth Third Bancorp. The announcement affects
current and former Fifth Third employees who have funds invested
in the Fifth Third Master Profit Sharing Plan.
ERISA is a federal law that provides remedies to employees and
retirees who are betrayed by fiduciaries who fail to prudently
and loyally manage employee retirement plans. The Complaint in
the Fifth Third 401(k) lawsuit alleges that Fifth Third and
certain other Defendants breached their fiduciary duties under
ERISA by, among other things:
(1) failing to properly manage the Plan's assets by
investing the Plan's assets in Fifth Third stock at a
time when they knew or should have known that it was
not prudent to do so;
(2) making material misrepresentations about Fifth Third
stock and failing to provide complete and accurate
information to participants and beneficiaries;
(3) failing to monitor those persons or entities who were
charged with managing the Plan and its assets; and
(4) failing to avoid conflicts of interest with respect to
the Plan.
The Fifth Third 401(k) lawsuit has been pending in federal court
in Ohio since early this year.
For more details, contact Amy Saba or Neil Rothstein of Scott +
Scott, LLC by Phone: 1-800-332-2259 or by E-mail:
53lawsuit@scott-scott.com.
GENERAL ELECTRIC: Subsidiary Chief Launches $450M Race Bias Suit
----------------------------------------------------------------
Marc Thomas, the chief executive of a subsidiary of General
Electric Corporation launched a $450 million civil lawsuit
against the company, alleging that GE denied him and other black
employees equal pay, promotions and other benefits, The Dallas
Morning News reports.
According the suit, Mr. Thomas, 43, who has led the GE Aviation
Materials LP since early 2004, is accusing the Connecticut-based
industrial, finance and media giant of bias that began last year
when he spoke out against discriminatory practices. The suit
states that Mr. Thomas has led GE Aviation Materials to an 89
percent profit increase last year and 162 percent growth in
first quarter 2005. But, despite his efforts, according to the
suit, he earned a rating of "least effective," reflecting
performance among the bottom 7 percent to 10 percent of all
company employees after complaining about practices he believed
favored white employees.
David Sanford, Mr. Thomas' Washington-based attorney told the
Morning News, "This suit was a last resort; he described in
detail his concerns. He went to in-house counsel, and he tried
to resolve concerns and complaints. That went nowhere."
Mr. Thomas had joined the company in 2001 as a manager in the
Fairfield, Connecticut corporate offices, but a year later, he
became general manager at GE Rail in Erie, Pennsylvania, before
eventually moving on to GE Aviation.
Mr. Sanford also told The Morning News that he's seeking class
action status for the suit, covering as many as 4,500 current
and former employees. He adds that he took the allegations
against GE to the U.S. Equal Employment Opportunity Commission
last week.
GE spokesman Rick Kennedy countered that the suit has no merit
and thus they will ask the United States District Court
officials in Bridgeport, Connecticut, to dismiss the case, the
Dallas Morning News reports. In an e-mailed statement to the
Morning News, Mr. Kennedy points out that his climb illustrates
how the company rewards good work. He adds, "We are an equal
opportunity employer and do not discriminate on the basis of
race. Our internal actions and policies bear this out in
pursuing and promoting diverse talent."
GLS CAPITAL: PA Court Mulls Certification For Taxpayer Lawsuit
--------------------------------------------------------------
The Commonwealth Court of Pennsylvania heard the motion for
class certification for the lawsuit filed against GLS Capital,
Inc. (GLS) and the County of Allegheny, Pennsylvania.
Plaintiffs were two local businesses seeking status to represent
as a class, delinquent taxpayers in Allegheny County whose
delinquent tax liens had been assigned to the Company.
Plaintiffs challenged the right of Allegheny County and the
Company to collect certain interest, costs and expenses related
to delinquent property tax receivables in Allegheny County, and
whether the County had the right to assign the delinquent
property tax receivables to the Company and therefore employ
procedures for collection enjoyed by Allegheny County under
state statute. This lawsuit was related to the purchase by the
Company of delinquent property tax receivables from Allegheny
County in 1997, 1998, and 1999.
In July 2001, the Commonwealth Court issued a ruling that
addressed, among other things:
(1) the right of the Company to charge to the delinquent
taxpayer a rate of interest of 12% per annum versus 10%
per annum on the collection of its delinquent property
tax receivables,
(2) the charging of a full month's interest on a partial
month's delinquency;
(3) the charging of attorney's fees to the delinquent
taxpayer for the collection of such tax receivables,
and
(4) the charging to the delinquent taxpayer of certain
other fees and costs.
The Commonwealth Court in its opinion remanded for further
consideration to the lower trial court items (1), (2) and (4)
above, and ruled that neither Allegheny County nor the Company
had the right to charge attorney's fees to the delinquent
taxpayer related to the collection of such tax receivables. The
Commonwealth Court further ruled that Allegheny County could
assign its rights in the delinquent property tax receivables to
the Company, and that plaintiffs could maintain equitable class
in the action.
In October 2001, the Company, along with Allegheny County, filed
an Application for Extraordinary Jurisdiction with the Supreme
Court of Pennsylvania, Western District appealing certain
aspects of the Commonwealth Court's ruling. In March 2003, the
Supreme Court issued its opinion as follows:
(i) the Supreme Court determined that the Company can
charge delinquent taxpayers a rate of 12% per annum;
(ii) the Supreme Court remanded back to the lower trial
court the charging of a full month's interest on a
partial month's delinquency;
(iii) the Supreme Court revised the Commonwealth Court's
ruling regarding recouping attorney fees for collection
of the receivables indicating that the recoupment of
fees requires a judicial review of collection
procedures used in each case; and
(iv) the Supreme Court upheld the Commonwealth Court's
ruling that GLS can charge certain fees and costs,
while remanding back to the lower trial court for
consideration the facts of each individual case.
Finally, the Supreme Court remanded to the lower trial court to
determine if the remaining claims can be resolved as a class
action. In August 2003, the Pennsylvania legislature enacted a
law amending and clarifying certain provisions of the
Pennsylvania statute governing GLS' right to the collection of
certain interest, costs and expenses. The law is retroactive to
1996, and amends and clarifies that as to items (ii)-(iv) noted
above by the Supreme Court, that the Company can charge a full
month's interest on a partial month's delinquency, that the
Company can charge the taxpayer for legal fees, and that it can
charge certain fees and costs to the taxpayer at redemption.
Subsequent to the enactment of the law, challenges to the
retroactivity provisions of the law were filed in separate
cases, which did not include the Company as a defendant.
In September 2004, the trial court in that litigation upheld the
retroactive provisions enacted in 2003. Plaintiffs in the case
are seeking class action status and have not currently set forth
a damage claim. A hearing on the class-action status was held in
late April 2005.
HOT TOPIC: To Seek Dismissal For CA Jewelry Lead Exposure Suits
---------------------------------------------------------------
Hot Topic, Inc. intends to ask the United States District Court
in Alameda, California to dismiss a class action filed against
it and over two dozen retailers by a non-profit corporation
named Center for Environmental Health (CEH). The suit also
names as defendants teen retailers like Claire's and Wet Seal,
department stores like Sears, Nordstrom, Macy's and J.C. Penney,
and large retailers like Wal-Mart and Target.
The suit sues the defendants for selling jewelry that has been
shown to contain dangerous amounts of lead. Most of the toxic
jewelry is imported costume jewelry specifically marketed to
children and women of child-bearing age. Lead can affect brain
development and is especially harmful to fetuses, infants and
young children, CEH said in a press release.
"It's frightening to think that a necklace could be a toxic
noose around your daughter's neck," CEH Executive Director
Michael Green said in a statement. "We expect these companies
to stop selling lead-contaminated jewelry immediately and put an
end to this real fashion emergency."
The jewelry found with high levels of lead include necklaces
made with plastic cords and metal jewelry made with tin. Poly
vinyl chloride (PVC) plastic in the cords leaches lead, and low-
grade tin in pendants and clasps is often lead-contaminated.
Exposure to lead is a special concern when women or children
chew on jewelry cords or metal parts. Brand names include:
Orion (Burlington), Claire's, Forever 21, Worthington (J. C.
Penney), Juststyle (K-Mart), Lane Bryant, Nairi (Nordstrom),
Eitenne V (Nordstrom), Apostrophe (Sears), Mainframe (Sears),
and Xhilaration (Target).
Certain of the defendants, but not the Company, were also named
defendants in a substantially similar lawsuit filed by the State
of California. The complaint in each case alleges, in general,
that the defendant retailers have violated certain California
statutes by not providing sufficient warning about an alleged
potential for lead exposure relating to costume jewelry sold in
stores. The complaints do not contain allegations of personal
injury.
In August 2004, the Company was served another complaint, filed
in the Circuit Court of Shelby County, Tennessee, claiming the
Company is liable due to alleged lead content in its costume
jewelry we allegedly target to children. This complaint is an
alleged class action, again excluding any personal injury claim,
with counts of negligence and breach of implied warranty.
Similar claims had been made, prior to service upon the Company,
against other retailers in the same jurisdiction by plaintiffs
represented by the same law firm. Currently, a motion to dismiss
is under consideration by the court in a separate case against
another retailer, and the Tennessee case against the Company has
been delayed pending the court's ruling on that motion.
The Company expects to file a similar motion to dismiss for the
suit. The plaintiffs in the above California cases seek
unspecified fines and penalties, attorneys' fees and costs, and
injunctive and other equitable relief; and the plaintiff in the
Tennessee case seeks unspecified money damages, punitive
damages, attorneys' fees and injunctive relief on behalf of the
alleged class.
CEH is represented in the suits by the Lexington Law Group, LLP,
a San Francisco firm specializing in environmental and consumer
public interest litigation.
HOT TOPIC: Discovery Proceeds in CA Employees' Overtime Lawsuit
---------------------------------------------------------------
Discovery is proceeding in the class action filed against Hot
Topic, Inc. in the Superior Court of Los Angeles County,
California on behalf of former Torrid store employees, alleging
state labor law violations.
The lawsuit asserts claims for failure to provide adequate meal
or rest breaks, improper payment of overtime wages, failure to
timely pay wages at end of employment and unfair business
practices. The lawsuit seeks compensatory damages, statutory
penalties, punitive damages, attorneys' fees and injunctive
relief.
INRANGE TECHNOLOGIES: 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 Inrange
Technologies, Inc., certain of its officers and the underwriters
of its initial public offering (IPO).
A shareholder class action was initially filed on November 30,
seeking recovery of damages caused by the Company's alleged
violation of securities laws, including section 11 of the
Securities Act of 1933 and section 10(b) of the Exchange Act of
1934.
The complaint, which was also filed against the various
underwriters that participated in the Company's IPO, is
identical to hundreds of shareholder class actions pending in
this court in connection with other recent IPOs and is generally
referred to as "In re Initial Public Offering Securities
Litigation." The complaint alleges, in essence, that the
underwriters combined and conspired to increase their respective
compensation in connection with the IPO by receiving excessive,
undisclosed commissions in exchange for lucrative allocations of
IPO shares, and trading in the Company's stock after creating
artificially high prices for the stock post-IPO through "tie-in"
or "laddering" arrangements (whereby recipients of allocations
of IPO shares agreed to purchase shares in the aftermarket for
more than the public offering price for Inrange shares) and
dissemination of misleading market analysis on the Company's
prospects. The suit further alleged that the Company violated
federal securities laws by not disclosing these underwriting
arrangements in its prospectus.
The defense has been tendered to the carriers of the Company's
director and officer liability insurance, and a request for
indemnification has been made to the various underwriters in the
IPO. At this point the insurers have issued a reservation of
rights letter and the underwriters have refused indemnification.
The court has granted the Company's motion to dismiss claims
under section 10(b) of the Securities Exchange Act of 1934
because of the absence of a pleading of intent to defraud. The
court granted plaintiffs leave to replead these claims, but no
further amended complaint has been filed. The court denied the
Company's motion to dismiss claims under Section 11 of the
Securities Act of 1933. The court has also dismissed the
Company's individual officers without prejudice, after they
entered into a tolling agreement with the plaintiffs.
On July 25, 2003, the Company's board of directors conditionally
approved a proposed partial settlement with the plaintiffs in
this matter. The settlement would provide, among other things, a
release of the Company and of the individual defendants for the
conduct alleged in the action to be wrongful in the complaint.
The Company would agree to undertake other responsibilities
under the partial settlement, including agreeing to assign away,
not assert, or release certain potential claims it may have
against its underwriters.
In June 2004, an agreement of settlement was submitted to the
court for preliminary approval. The underwriters objected to the
proposed settlement and the plaintiffs and issuer defendants
separately filed replies to the underwriter defendants'
objections. The court granted the preliminary approval motion
on February 15, 2005, subject to certain modifications. If the
parties are able to agree upon the required modifications, and
such modifications are acceptable to the court, notice will be
given to all class members of the settlement, a "fairness"
hearing will be held and if the court determines that the
settlement is fair to the class members, the settlement will be
approved.
The suit is styled "IN RE INRANGE TECHNOLOGIES, INC. INITIAL
PUBLIC OFFERING SECURITIES LITIGATION," filed in relation to "IN
RE INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File
No. 21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. 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
KAISER VENTURES: Discovery Proceeds in CA Unfair Trade Lawsuit
--------------------------------------------------------------
Discovery is proceeding in the class action filed against Kaiser
Ventures LLC in the San Bernardino County District Court in
California, styled "Thomas M. Slemmer, et al v. Fontana Union
Water Company, et al., Case No. SCVSS 086856." The suit also
names as defendants:
(1) Fontana Union Water Company,
(2) Cucamonga County Water Company,
(3) San Gabriel Valley Water and
(4) individuals serving on the Board of Directors of
Fontana Union Water Company
Plaintiffs allege that they are the owners of 175 shares of the
stock of Fontana Union Water Company, a mutual water company,
and that the defendants conspired and committed acts that
constitute an unlawful restraint of trade, a breach of fiduciary
duty by the controlling shareholders of Fontana Union and
fraudulent business practices in violation of California law.
Among other things, plaintiffs have requested $25,000,000 in
damages and the trebling of such damages under California law.
The lawsuit is proceeding as a class action lawsuit. Discovery
in the case is currently ongoing and a trial on the matter is
currently scheduled to occur in 2005.
KROGER CO.: EEOC Launches Sexual Discrimination Lawsuit in TX
-------------------------------------------------------------
The Equal Employment Opportunity Commission initiated a sex bias
class action lawsuit against The Kroger Company, alleging the
grocery chain refused to hire women for physically demanding
jobs at its distribution center in northeast Houston, The
Houston Chronicle reports.
Court documents state that two women, Yolanda Washington and
Subrena Tarver, who both had each had previous experience as
"order selectors" and met the other qualifications, such as a
high school diploma and a crime-free background, applied for
jobs at Kroger's warehouse in September 2003. However, according
to the suit, the two women were never hired for the positions,
which require lifting and stacking boxes up to 60 pounds, while
less qualified men were hired.
Rose Adewale-Mendes, EEOC supervisory trial attorney told the
Chronicle that they were never even interviewed for the jobs.
She also said that until Kroger was notified of the complaint in
October 2003, the company didn't have any women working as order
selectors in its Houston warehouse. Additionally, Ms. Adewale-
Mendes added that Kroger offered women those jobs only after the
complaint was filed with the EEOC.
LUIGINO'S INC.: Launches Suit V. WV Economic Development Agency
---------------------------------------------------------------
Luigino's Inc., Jeno Paulucci's Duluth-based frozen food
company, launched a lawsuit against a West Virginia economic
development agency for $2.5 million, alleging that the agency
did not disclose a class action lawsuit regarding an
environmental hazard near a plant the company plans to build,
The Duluth News Tribune reports.
Court documents reveal that Luigino's signed a purchase
agreement in late 2002 to build a 180,000-square-foot food
processing facility in Parkersburg, West Virginia, that was to
have been completed in 2004. According to the Luigino's
complaint, which was filed in Monongalia County Circuit Court,
the West Virginia Economic Development Authority said in the
agreement that no private party or government litigation was
pending that affected the project.
However, the complaint contends that a class-action lawsuit by
Parkersburg residents against DuPont's Washington Works Plant,
less than six miles from the site, had been filed in 2001. That
suit had contended that the plant "was the cause of significant
environmental hazards and significant personal injury and health
problems because the plant was polluting the air, groundwater,
soil and the environment generally with a substance used to make
Teflon called C8."
As reported in previous edition of the Class Action Reporter,
DuPont paid millions of dollars in February to settle that case.
In its case against the agency, the company is asking for the
$2.5 million it invested in the building and site before
learning of the suit and pulling out the project and in addition
asks for damages and attorney's expenses.
Luigino's lawyer George Eck of Minneapolis law firm Dorsey &
Whitney, told the Tribune, because Luigino's was building a food
processing plant, "there cannot be any environmental stigma"
attached to the plant. He adds, "We're sure we can prove that
the West Virginia Economic Development Authority knew about the
suit."
MARVELL TECHNOLOGY: 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 Marvell
Technology Group, Inc., certain of its officers and the
underwriters of the Company's initial public offering (IPO).
On July 31, 2001, a putative class action suit was filed against
two investment banks that participated in the underwriting of
the Company's IPO on June 29, 2000. That lawsuit, which did not
name the Company or any of its officers or directors as
defendants, was filed in the United States District Court for
the Southern District of New York. Plaintiffs allege that the
underwriters received "excessive" and undisclosed commissions
and entered into unlawful "tie-in" agreements with certain of
their clients in violation of Section 10(b) of the Securities
Exchange Act of 1934.
Thereafter, on September 5, 2001, a second putative class action
was filed in the Southern District of New York relating to the
Company's IPO. In this second action, plaintiffs named three
underwriters as defendants and also named as defendants Marvell
and two of the Company's officers, one of whom is also a
director. Relying on many of the same allegations contained in
the initial complaint in which Marvell was not named as a
defendant, plaintiffs allege that the defendants violated
various provisions of the Securities Act of 1933 and the
Securities Exchange Act of 1934. In both actions, plaintiffs
seek, among other items, unspecified damages, pre-judgment
interest and reimbursement of attorneys' and experts' fees.
These two actions relating to the Company's IPO have been
consolidated with hundreds of other lawsuits filed by plaintiffs
against approximately 40 underwriters and approximately 300
issuers across the United States. Defendants in the
consolidated proceedings moved to dismiss the actions. In
February 2003, the trial court issued its ruling on the motions,
granting the motions in part, and denying them in part. Thus,
the cases may proceed against the underwriters and the Company
as to alleged violations of section 11 of the Securities Act of
1933 and section 10(b) of the Securities Exchange Act of 1934.
Claims against the individual officers have been voluntarily
dismissed with prejudice by agreement with plaintiffs. On June
26, 2003, the plaintiffs announced that a settlement among
plaintiffs, the issuer defendants and their directors and
officers, and their insurers has been structured, a part of
which provides that the insurers for all issuer defendants would
guarantee up to $1 billion to investors who are class members,
depending upon plaintiffs' success against non-settling parties.
The Company's board of directors has approved the proposed
settlement, which will result in the plaintiffs' dismissing the
case against the Company and granting releases that extend to
all of its officers and directors. Definitive settlement
documentation was completed in early June 2004 and first
presented to the court on June 14, 2004. On February 15, 2005,
the court issued an opinion preliminarily approving the proposed
settlement, contingent upon certain 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). The court
scheduled a further conference for April 13, 2005, for the
purposes of making a final determination as to the form,
substance and program of class notice, and scheduling a Rule 23
public hearing on the fairness of the proposed settlement.
The suit is styled "IN RE MARVELL TECHNOLOGY GROUP, INC. INITIAL
PUBLIC OFFERING SECURITIES LITIGATION," filed in relation to "IN
RE INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File
No. 21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. 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
MERCEDES-BENZ USA: Recalls 7191 M-Class Cars Due To Crash Hazard
----------------------------------------------------------------
Mercedes-Benz USA, LLC is cooperating with the National Highway
Traffic Safety Administration (NHTSA) by voluntarily recalling
7,191 M-Class cars, model 2006.
On these cars, a hose clamp that secures the power steering
fluid cooling hose to the power steering fluid cooler may not
provide sufficient clamping force for this connection. A loss
of power steering fluid can damage the power steering pump and
may result in diminished power assist for steering, which could
lead to a crash.
Dealers will replace the power steering hose clamp. The recall
is expected to begin on May 23,2005. For more details contact
the Company by Phone: 1-800-367-6372 or contact the NHTSA's auto
safety hotline: 1-888-327-4236.
MICHAELS OF OREGON: Recalls 8T Belt Holsters Due To Injury Risk
---------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Michaels of Oregon, of Oregon City, Oregon is
voluntarily recalling about 8,000 Kydex Belt Holsters for Glock
model handguns.
The holster's retention strap can move out of position and could
cause a handgun to unexpectedly discharge while being
reholstered, posing a serious injury risk to consumers. The firm
has received three reports of unexpected discharges. In one
incident, a law enforcement officer was shot in the leg while
reholstering his firearm.
The recall includes Kydex Belt and Tactical Holsters with thumb
break fits for Glock model handguns. The holsters are rigid and
are made of black Kydex and come with tension screws for a
proper fit. The words, "Uncle Mike's by Michaels of Oregon" are
printed on the back of the holster. The recall involves sizes
12, 21, and 25, which is printed on the inside of the holster
between the two screws securing the holster to the belt slide.
Manufactured in the United States, the holsters were sold at all
Uncle Mike's and Uncle Mike's Law Enforcement catalogs and at
sporting goods stores and gun supply stores nationwide from
January 2002 through October 2002 for between $25 and $50.
Consumers who have purchased a Kydex Holster with a Thumb break
for a Glock Handgun should stop using it immediately and contact
Michaels of Oregon for a replacement retention strap free of
charge.
Consumer Contact: Call Michaels of Oregon at (800) 471-4999
between 7:30 a.m. and 4:30 p.m. PT Monday through Friday, or
visit their Web site: http://www.michaeloforegon.com.
NORTH DAKOTA: New Proceedings Ordered in Case Labor Department
--------------------------------------------------------------
North Dakota's Supreme Court ordered a Fargo judge to clarify
who may be affected by a proposed class action lawsuit against
the state Labor Department, The Associated Press reports.
Seven people, all of whom have filed discrimination claims with
the agency and believe it has been tardy in resolving them, are
pursuing the suit in question. Another participant though in the
original lawsuit, the North Dakota Human Rights Coalition, was
dismissed from it last year.
Last August, East Central District Judge Douglas Herman had
ruled that three of the seven individual plaintiffs could pursue
a class action lawsuit against the Labor Department. Those three
plaintiffs who were allowed by the judge had filed complaints,
but had not received an agency decision about whether their
claims had merit.
To avoid confusion, the Supreme Court, in a unanimous decision,
said that Judge Herman's order was open to different
interpretations about who would be affected by the lawsuit. In
the Supreme Court's ruling, Justice Dale Sandstrom wrote, "Here,
the court's decision to certify this class action does not
provide an adequate explanation for us to understand the basis
for its decision." Judge Herman's order, according to Jsutice
Sandstrom, "does not clearly define the class."
Mark Schneider, a Fargo attorney for the plaintiffs, told AP
that he believes the Supreme Court wants Judge Herman to "simply
put some flesh on the bones" of his earlier decision. He adds,
"This is not rocket science. What we're looking to do is to have
the Department of Labor conduct its mandatory administrative
civil rights enforcement duties. They're not doing the job. That
is our mantra, and we think Judge Herman agrees with us."
Asked for comment, the Labor Department's lawyer, Douglas Bahr,
the state solicitor general, told AP that the agency has already
filed requests that the cases be dismissed. He believes the
agency has handled the lawsuit plaintiffs' cases properly, Mr.
Bahr adds.
PHIL LONG FORD: Car Buyer Lodges CO Suit Over Extras in Contract
----------------------------------------------------------------
Amy Gooch, 33, a resident of Centennial, Colorado launched a
lawsuit against Phil Long Ford dealership of Denver for
allegedly charging her extra for unwanted products and
insurance, The Denver Post reports.
Court documents reveal that Ms. Gooch was pressured to buy a
handful of extras that she either didn't want or thought she was
required to buy when she purchased a used 2002 Ford Explorer
from Phil Long in January.
She told the Denver Post that she was alerted to the fact that
the extras were included in her contract when a 9News reporter
contacted her several weeks ago. She adds, "I was shocked that I
wasn't made more aware that these items were in there and that I
was automatically paying for them and that my payments could
have been much less without them. I think they saw me as a woman
coming in there and not knowing too much. I was taken advantage
of."
The suit, which was filed in Denver District Court, seeks class-
action status and alleges that Phil Long routinely engaged in
deceptive advertising and concealment of information from
customers from May 1996 to the present. The suit though does not
specify the amount of purported overcharges paid by Ms. Gooch.
The extras that Ms. Gooch said she was sold included life
insurance and gap insurance, which provides added accident
coverage. Ms. Gooch told the Post that she was led to believe
she had to buy them. Additionally, she said that she also paid
$199 without her knowledge to have the car's vehicle-
identification number etched into the windshield, the service,
however was never performed.
PRICESMART INC.: Reaches Settlement For CA Securities Fraud Suit
----------------------------------------------------------------
PriceSmart, Inc. reached a settlement for the consolidated
securities class action filed in the United States District
Court for the Southern District of California against it and
certain of its former and present officers and directors, styled
as "In re PriceSmart, Inc. Securities Litigation, Lead Case No.
03cv02260L (LSP)." The suits specifically name as individual
defendants former President and Chief Executive Officer Gilbert
Partida, and former Chief Financial Officer Allan C. Youngberg.
On behalf of a proposed class of persons who purchased the
Company's common stock between December 20, 2001 and November 7,
2003, plaintiffs asserted claims under Section 10(b) and Section
20(a) of the Securities Exchange Act of 1934, and SEC Rule 10b-5
promulgated thereunder, based on the allegation that defendants
made material misstatements and omissions in connection with the
financial statements that were the subject of a financial
restatement. Plaintiffs seek damages on behalf of the proposed
class.
Another federal securities fraud complaint, styled "Performance
Capital L.P. v. PriceSmart, Inc., Case No. 03cv02561 JAH (S.D.
Cal)," was filed by investors who purchased the Company's Series
A Preferred Stock in January 2002, as well as on behalf of a
class of common stock purchasers, and added a breach of
fiduciary duty claim against every then-current member of the
Company's current Board of Directors, as well as a claims under
Section 12(a)(2) and Section 15 of the Securities Act of 1933
relating to plaintiffs' purchase of Series A Preferred Stock.
The Company refers to this litigation as the Performance Capital
lawsuit. Plaintiffs sought damages on behalf of the proposed
class as well as rescission of their contracts with the Company
regarding the Series A Preferred Stock.
All of the federal securities actions were consolidated before
The Honorable John Houston in an order dated September 9,
2004, which also appointed a lead plaintiff on behalf of the
proposed class of common stock purchasers. The lead plaintiff
filed a consolidated complaint on November 29, 2004, with an
expanded proposed class period of November 1, 2001 to December
16, 2003.
Defendants and the plaintiffs who brought the Performance
Capital lawsuit entered into a Stipulation of Settlement dated
September 3, 2004, which was preliminarily approved by Judge
Houston on September 30, 2004. On September 30, 2004, Judge
Houston also approved a stipulation appointing the plaintiffs in
the Performance Capital lawsuit as lead plaintiff for a proposed
sub-class made up of certain purchasers and holders of the
Company's Series A Preferred Stock, which the Company refers to
as the Series A Preferred Sub-Class. On November 8, 2004,
following notice to members of the Series A Preferred Sub-Class,
the settlement was approved and judgment was entered. Pursuant
to the settlement, the Performance Capital lawsuit has been
dismissed and the Court has entered an order releasing claims
that were or could have been brought by the Series A Preferred
Sub-Class arising out of or relating to the purchase or
ownership of the Company's Series A Preferred Stock. As a term
of the settlement, members of the Series A Preferred Sub-Class
were offered the opportunity to exchange their Series A
Preferred Stock for shares of the Company's common stock at a
conversion price of $10.00 per share, and all members of the
Series A Preferred Sub-Class accepted this offer. The Company
paid attorney's fees and costs to counsel for the Performance
Capital plaintiffs in the amount of $325,000, which was covered
by the Company's insurance carrier.
Defendants and the parties to the remaining class action
lawsuits entered into a Memorandum of Understanding dated March
2, 2005 which sets forth the terms of a settlement of all
claims, subject to confirmatory discovery and final court
approval. Under the tentative settlement, in exchange for a full
release of all claims, plaintiffs would receive $2,350,000, of
which the Company's directors and officers insurance carrier
would pay 80% and the Company would pay 20%, subject to
discussions between the Company and the insurance carrier on the
issue of whether the Company has already reached the $1 million
retention of its insurance policy.
The settlement is subject to court approval and there can be no
assurance that the settlement will receive such approval. If the
settlement is not approved and the Company is ultimately
adjudged to have violated federal securities laws, the Company
may incur substantial losses as a result of an award of damages
to plaintiffs, which could impair the Company's liquidity and
have a material adverse effect on its business, results of
operations and financial condition.
The suit is styled "IN re PriceSmart, Inc. Securities
Litigation, case no. 03-CV-2260," filed in the United States
District Court for the Southern District of California, under
Judge John A. Houston. Representing the Company is Julia Parry
of Latham and Watkins LLP, West Broadway, Suite 1800, San Diego,
CA 92101-8197 Phone: (619)236-1234. The plaintiff firms in this
litigation are Glancy and Binkow, 1801 Avenue of the Stars,
Suite 311, Los Angeles, CA, 90067, Phone: 310-201-9150, E-mail:
info@glancylaw.com; and Goodkind Labaton Rudoff & Sucharow LLP,
100 Park Avenue, New York, NY, 10017, Phone: 212.907.0700, Fax:
212.818.0477, E-mail: info@glrslaw.com.
ST. JAMES: Limited Partners Launch Securities Fraud Suit in TX
--------------------------------------------------------------
St. James Capital Partners, L.P. and its affiliated entity SJMB,
L.P. (collectively "St. James Partnerships") face a class action
filed in Texas State Court. The suit also names as defendants
the partnerships' general partners and Charles E. Underbrink,
director of Black Warrior Wireline Corporation and a director of
the general partners of the St. James Partnerships.
Two of the limited partners of the St. James Partnerships filed
the suit, initially against the auditors of the St. James
Partnerships. The suit was amended in March 005. The
plaintiffs brought the action as a class action on behalf of all
the limited partners of the St. James Partnerships and are
seeking class action certification.
No claim has been asserted against Black Warrior and it is not a
defendant in the action. However, the complaint and the amended
complaint in the action contain allegations that Black Warrior
participated with Mr. Underbrink in actions the plaintiffs
allege were fraudulent and constituted securities violations.
TURNSTONE SYSTEMS: NY Court Preliminarily OKs Lawsuit Settlement
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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 Turnstone
Systems, Inc., certain of its current and former officers and
directors, and the underwriters of its initial public offering
of stock as well as its secondary offering of stock.
On November 9, 2001, Arthur Mendoza filed a securities class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of a class of
individuals who purchased common stock in the Company's initial
public offering and its secondary stock offering between January
31 and December 6, 2000. The complaint alleges generally that
the prospectuses under which such securities were sold contained
false and misleading statements with respect to discounts and
commissions received by the underwriters.
The case has been coordinated for pre-trial purposes with over
300 cases raising the same or similar issues and also currently
pending in the Southern District of New York. On April 18, 2002,
Michael Szymanowski was appointed lead plaintiff in the action.
On April 22, 2002, an amended complaint was filed. On July 1,
2002, the underwriter defendants filed an omnibus motion to
dismiss. On July 15, 2002, the Company, collectively with the
other issuer defendants, also filed an omnibus motion to
dismiss. The lead plaintiff filed an opposition to the
underwriters' motion to dismiss on August 15, 2002 and to the
issuers' motion to dismiss on August 27, 2002. The
underwriters' reply to the opposition was filed on September 13,
2002, and the Company's reply to the opposition was filed on
September 27, 2002. On February 19, 2003, the court issued an
order denying the motions to dismiss with respect to
substantially all of the plaintiffs' claims, including those
against the Company.
In February 2005, the court granted preliminary approval for a
proposed settlement and release of claims against the issuer
defendants, including the Company. The settlement is still
subject to a number of conditions, including final court
approval.
The suit is styled "IN RE TURNSTONE SYSTEMS, INC. INITIAL PUBLIC
OFFERING SECURITIES LITIGATION," filed in relation to "IN RE
INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File No.
21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. 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
VAN HOOL: Recalls 150 2000-01 Buses For Window Latching Defect
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Van Hool, N.V. in cooperation with the National Highway Traffic
Safety Administration's Office of Defects Investigation (ODI) is
voluntarily recalling about 150 units of 2000-01 C2045 buses.
Cross Road Cruisers and Zingers.
According to ODI, certain busses fail to comply with the
requirement of Federal Motor Vehicle Safety Standard No. 217,
"Bus Emergency Exits and Window Retention and Release." The
office states that there is a mismatching of the emergency
window latching components. The mismatch could make the window
open prematurely or inadvertently in the event of a crash.
As a remedy dealer will inspect and replace the mismatched
emergency window latching components.
For more details, contact Van Hool by Phone: 877-427-7278 or the
NHTSA Auto Safety Hotline: 1-888-327-4236.
WATCHGUARD TECHNOLOGIES: Law Firm Sets Lead Plaintiff Deadline
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Investors have until June 7, 2005 to seek appointment by the
Court as one of the lead plaintiffs in the class action lawsuit
filed by Pomerantz Haudek Block Grossman & Gross LLP on behalf
of purchasers of WatchGuard Technologies, Inc. ("WatchGuard" or
the "Company") (NASDAQ:WGRD) securities during the period from
February 12, 2004 to March 15, 2005, inclusive (the "Class
Period"). The lawsuit was filed on April 19, 2005 in the United
States District Court, Western District of Washington.
The complaint charges WatchGuard and certain of its officers and
directors with knowingly or recklessly misrepresented the
Company's earnings throughout the Class Period, and thereby
causing the Company's stock price to trade at artificially
inflated prices in violation of the Securities Exchange Act of
1934.
According to the complaint, the true facts, which were known by
the defendants during the Class Period but concealed from the
investing public, were as follows:
(1) the Company's Q1-Q3 2004 reported financial results
were materially false and misleading due to inaccurate
income statement classification of early pay incentive
discounts taken by customers, under-accrual of customer
rebate obligations and timing of revenue recognition
associated with specific products and services
(resulting from an overstatement of product revenue and
an understatement of deferred revenue);
(2) the Company's February 12, 2004 projections were
materially false and misleading;
(3) the functionality and value of the Company's "Firebox
X" product was grossly overstated and this product did
not materially or accurately improve the Company's
gross margins, streamline the Company's management or
otherwise reduce its reliance on custom components; and
(4) contrary to defendants' statements, the Firebox X was
not tracking as defendants claimed.
On March 16, 2005, WatchGuard disclosed that certain errors were
discovered in its audit process and that it would need to
reclassify early pay incentive discounts from interest expense
to reduce its revenue for its previous financial results for
2002, 2003 and the first three quarters of 2004 an error was
discovered in the Company's handling of lease incentives and the
errors reflected a material weakness in the Company's internal
controls over financial reporting. The market reacted swiftly to
this disclosure, with the Company's stock price falling to a
closing price of $3.17 on March 16, 2005.
For more details, contact Carolyn S. Moskowitz of Pomerantz
Haudek Block Grossman & Gross LLP by Phone: 888-476-6529 by E-
mail: csmoskowitz@pomlaw.com or visit their Web site:
http://www.pomlaw.com.
New Securities Fraud Cases
DORAL FINANCIAL: Abraham Fruchter Lodges Securities Suit in NY
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The law firm of Abraham Fruchter & Twersky LLP initiated a class
action in the United States District Court for the Southern
District of New York on behalf of purchasers of Doral Financial
Corporation ("Doral") (NYSE: DRL) publicly traded securities
during the period between October 10, 2002 and April 19, 2005
(the "Class Period").
The complaint charges Doral and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Doral is a diversified financial services company engaged
in mortgage banking, commercial banking, institutional broker-
dealer activities and insurance agency activities.
The complaint alleges that during the Class Period, defendants
made materially false and misleading statements regarding the
Company's business and prospects. On January 19, 2005, the
company reported fourth quarter earnings and for the first time
warned of potential trouble with its hedging strategy against
interest rate changes through its use of a derivative portfolio
of interest-only strips ("IO Strips"). Doral was forced to
record a $97.5 million pretax impairment charge on its
derivative portfolio of IO Strips. On March 15, 2005, Doral
filed its Annual Report on Form 10-K with the Securities and
Exchange Commission ("SEC"). In its 2004 Annual Report the
Company disclosed for the first time its use of overly
aggressive assumptions in valuing its derivatives portfolio of
IO Strips. In a matter of days Doral stock plummeted from $38.29
per share to $21.50 per share in extremely heavy volume of more
than ten times the daily average.
Then on April 19, 2005, the Company announced that "after
consulting with various financial institutions and other firms
with experience in valuation issues, the Company has determined
that it is appropriate to correct the methodology used to
calculate the fair value of its portfolio of floating rate
interest only strips ("IOs"). The Company's preliminary estimate
is that this correction will result in a decrease in the fair
value of its floating rate IOs of between $400 million to $600
million as of December 31, 2004."
According to the complaint, the true facts, which were known by
each of the defendants but concealed from the investing public
during the Class Period, were as follows:
(1) the Company was using overly aggressive and unrealistic
assumptions to value its derivative portfolio of IO
Strips used to hedge its mortgage portfolio against
interest rate fluctuations;
(2) the Company was using fraudulent accounting practices
and materially overstated its net income, net gain on
mortgage loan sales and net capital; and
(3) the Company was using ineffective risk management and
hedging strategies against the increasing risk of
rising interest rates.
As a result of these false statements, Doral's stock price
traded at inflated levels during the Class Period, increasing to
as high as $49.45 per share on January 18, 2005. The Company
sold $740 million worth of notes and $345 million worth of
preferred stock during the Class Period. However, after the
truth was revealed in Doral's press release on April 19, 2005,
the Company's shares fell to below $16 per share.
For more details, contact Jack G. Fruchter, Esq. or Ximena
Skovron, Esq. of Abraham, Fruchter & Twersky, LLP by Mail: One
Penn Plaza, Suite 2805, New York, New York 10119 by Phone:
(212) 279-5050 or (800) 440-8986 by Fax: (212) 279-3655 or by E-
mail: jfruchter@aftlaw.com or xskovron@aftlaw.com.
FINDWHAT.COM INC.: Brodsky & Smith Lodges Securities Suit in FL
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The Law Offices of Brodsky & Smith, LLC initiated a class action
lawsuit in the United States District Court for the Middle
District of Florida on behalf of all those who purchased or
otherwise acquired securities of FindWhat.com, Inc.
(Nasdaq:FWHT) ("FindWhat" or the "Company") between January 5,
2004 and May 4, 2005, inclusive (the "Class Period").
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period,
thereby artificially inflating the price of FWHT securities. No
class has yet been certified in the above action.
For more details, contact Evan J. Smith, Esquire or Marc L.
Ackerman, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza,
Suite 602, Bala Cynwyd, PA 19004 by Phne: 877-LEGAL-90 or by E-
mail: clients@brodsky-smith.com.
FRIEDMAN BILLINGS: Glancy Binkow Lodges Securities Lawsuit in NY
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The law firm of Glancy Binkow & Goldberg LLP initiated a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of a class (the "Class")
consisting of all persons or entities who purchased or otherwise
acquired securities of Friedman, Billings, Ramsey Group, Inc.
("FBR" or the "Company") (NYSE:FBR) during the period January
29, 2003 through April 25, 2005 (the "Class Period").
The Complaint charges FBR and certain of the Company's executive
officers with violations of federal securities laws. FBR is an
investment bank that provides investment banking, institutional
brokerage and asset management services, and invests as
principal in mortgage-backed securities and merchant banking
investments. Plaintiff claims defendants' omissions and material
misrepresentations concerning the Company's operations and
financial performance artificially inflated the Company's stock
price, inflicting damages on investors. The Complaint alleges
that during the Class Period, defendants knew or recklessly
disregarded and failed to disclose material adverse facts,
including that:
(1) the Company was being negatively impacted by its role
as a placement agent for an insurer in a "Private
Investment In Public Equity" (PIPE) transaction in
2001;
(2) as a result of the 2001 transaction, the Company was
forced to take $7.5 million dollar charge, which
adversely affected FBR's earnings; and
(3) the Company's earnings were being adversely impacted by
interest rate increases.
On November 9, 2004, FBR filed its third quarter 2004 Form 10-Q
in which it disclosed an SEC and National Association of
Securities Dealers (NASD) investigation concerning FBR's role in
2001 as a placement agent for an issuer in a PIPE transaction.
On April 4, 2005, CEO Emanuel J. Friedman resigned. Then, on
April 25, 2005, after the market closed, FBR announced
disappointing preliminary financial results for first quarter
2005, including a charge for its liability in the PIPE
transaction. This news shocked the market, sending FBR shares
down 13 percent, or $1.87 per share, to close at $12.52 per
share on April 26, 2005.
For more details, contact Lionel Z. Glancy or Michael Goldberg
of Glancy Binkow & Goldberg LLP, Los Angeles, CA by Phone:
(310) 201-9150 or (888) 773-9224 by E-mail: info@glancylaw.com
or visit their Web site: http://www.glancylaw.com.
FRIEDMAN BILLINGS: Milberg Weiss Lodges Securities Lawsuit in VA
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The law firm of Milberg Weiss Bershad & Schulman LLP initiated a
class action lawsuit on behalf of purchasers of the securities
of Friedman, Billings Ramsey Group, Inc. ("FBR" or the
"Company") (NYSE:FBR) between May 7, 2003 and April 25, 2005,
inclusive (the "Class Period"), seeking to pursue remedies under
the Securities Exchange Act of 1934 (the "Exchange Act").
The action is pending in the United States District Court for
the Eastern District of Virginia against defendants FBR, Emanuel
J. Friedman (Co-CEO), Eric F. Billings (Co-CEO), Kurt R.
Harrington (CFO), and Robert Kiernan (VP and Chief Accounting
Officer).
The complaint alleges that FBR provides investment banking,
institutional brokerage and asset management services, and
invests as principal in mortgage-backed securities (MBS) and
merchant banking investments. The complaint further alleges that
FBR's revenues and earnings are dependent upon customers' and
investors' perception that FBR maintained an adequate system of
internal financial and operational controls, including a
"Chinese Wall" between its banking and brokerage divisions
adequate to prevent those inside the Company from illegally
usurping information that could be used to manipulate the market
or facilitate insider trading. Unbeknownst to investors, the
Company did not maintain such a Chinese Wall and defendants
caused FBR to engage in insider trading and the manipulation of
PIPE (Private Investment in Public Equity) transactions. The
truth emerged on April 26, 2005. On that date, the Company
announced preliminary results for the first quarter of 2005,
which were well below guidance, and disclosed that the results
included a reserve of $7.5 million for potential settlement by
the company's broker-dealer subsidiary related to an SEC
investigation concerning a PIPE transaction. On this news, FBR
shares fell $1.87 per share, or 13%, to close at $12.52.
For more details, contact Steven G. Schulman, Peter E. Seidman
or Andrei V. Rado by Mail: One Pennsylvania Plaza, 49th fl.
New York, NY 10119-0165 by Phone: (800) 320-5081 by E-mail:
sfeerick@milbergweiss.com or visit their Web site:
http://www.milbergweiss.com.
MOLSON COORS: Brodsky & Smith Lodges Securities Fraud Suit in DE
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The Law Offices of Brodsky & Smith, LLC initiated a class action
lawsuit in the United States District Court for the District of
Delaware on behalf of former shareholders of Molson, Inc.
("Molson") who received shares of Molson Coors Brewing Company
("Molson Coors" or the "Company") (NYSE:TAP) as a result of the
February 9, 2005 merger of Molson by and into the Adolph Coors
Company ("Coors"), open market purchasers of the common stock of
Coors from July 22, 2004 to February 9, 2005, inclusive and open
market purchasers of the common stock of the Company, following
completion of the merger between Molson and Coors on or about
February 9, 2005 to April 27, 2005, inclusive, and who were
damaged by the decline in the Company's stock. Plaintiff is
seeking remedies under the Securities Exchange Act of 1934 (the
"Exchange Act").
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the Class Period,
thereby artificially inflating the price of TAP securities. No
class has yet been certified in the above action.
For more details, contact Evan J. Smith, Esquire or Marc L.
Ackerman, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza,
Suite 602, Bala Cynwyd, PA 19004 by Phne: 877-LEGAL-90 or by E-
mail: clients@brodsky-smith.com.
MOLSON COORS: Charles J. Piven Files Securities Fraud Suit in DE
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The Law Offices Of Charles J. Piven, P.A. initiated a securities
class action on behalf of former shareholders of Molson, Inc.
who received shares of Molson Coors Brewing Company (NYSE: TAP)
(the "Company") as a result of the February 9, 2005 merger of
Molson by and into the Adolph Coors Company, open market
purchasers of the common stock of Coors from July 22, 2004 to
February 9, 2005, inclusive and open market purchasers of the
common stock of the Company, following completion of the merger
between Molson and Coors on or about February 9, 2005 through
April 27, 2005, inclusive, and who were damaged by the decline
in the Company's stock.
The case is pending in the United States District Court for the
District of Delaware against defendant Molson Coors, Peter H.
Coors, W. Leo Kiely, III, Charles M. Herington, Franklin W.
Hobbs, Randall Oliphant, Pamela Patsley, Wayne Sanders, Albert
C. Yates, Timothy V. Wolf, Peter Swinburn, David G. Barnes and
Peter M. R. Kendall. The action charges that defendants violated
federal securities laws by issuing a series of materially false
and misleading statements to the market throughout the Class
Period, which statements had the effect of artificially
inflating the market price of the Company's securities. No class
has yet been certified in the above action.
For more details, contact the Law Offices Of Charles J. Piven,
P.A. by Mail: The World Trade Center-Baltimore, 401 East Pratt
Street, Suite 2525, Baltimore, Maryland 21202 by Phone:
410/986-0036 or by E-mail: hoffman@pivenlaw.com.
*********
A list of Meetings, Conferences and Seminars appears in each
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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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Copyright 2005. All rights reserved. ISSN 1525-2272.
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