/raid1/www/Hosts/bankrupt/CAR_Public/050606.mbx
C L A S S A C T I O N R E P O R T E R
Monday, June 6, 2005, Vol. 7, No. 110
Headlines
AETNA INC.: Securities Settlement Hearing Set September 12, 2005
AMERICAN PROCESSING: TX Court Dismisses Class Claims in Lawsuit
APPLE COMPUTER: Opts To Settle Consolidated iPod Battery Suits
ARKANSAS: Judge To Decide Status of Women's Lawsuit Over Prempro
ARTHUR ANDERSEN: Lawsuit Settlement Hearing Set July 25, 2005
CAMPUS APARTMENTS: CA Judge OKs $300T Settlement For Tenant Suit
CANADA: Norske Skog Lodges Antitrust Suit V. 20 Chemical Firms
CHIRON CORPORATION: Plaintiffs File Consolidated Securities Suit
CHIRON CORPORATION: County of Nassau Files Amended MA AWP Suit
COMDISCO INC.: Securities Settlement Hearing Set July 14, 2005
CRYOLIFE INC.: Seeks Summary Judgment in Securities Suit in GA
DREAMWORKS ANIMATION: Shareholders Files CA Suit Over DVD Sales
FIRST AMERICAN: Court Case Launched in IL Over Closing Charges
FRANCE: DVD Suit Targets Major Video Production Companies
GENERIC VALUE: Recalls 20T Straightening Iron Due to Burn Hazard
GILEAD SCIENCES: Plaintiffs File Amended Securities Suit in CA
GREAT LAKES: Faces Litigation Due To GA Facility May 2004 Fire
HAWAII: Former Prisoners Win $1.2M Award Over Long Imprisonment
INTERNATIONAL PAPER: SC Court Refuses To Dismiss Antitrust Suit
INTERNATIONAL TRUCK: Recalls 3288 Vehicles Due to Brake Defect
ITEX CORPORATION: OR Court Sets June 22, 2005 Claims Deadline
KINDER MORGAN: CO Court Holds Suit Settlement Fairness Hearing
LAFARGE CANADA: Seeks Certiorari For Certification of MI Lawsuit
MAGNUM HUNTER: Enters Into MOU For Lawsuit Over Cimarex Merger
MARSH & MCLENNAN: Working on NYAG Probe, Civil Suit Settlement
MASSACHUSETTS: Suit Filed V. HN Crematorium, Local Funeral Homes
MERCURY INSURANCE: CA Court Grants Demurrer V. Consumer Lawsuit
MERCURY INSURANCE: Asks CA Court To Dismiss Consumer Fraud Suit
MERCURY INSURANCE: CA Court To Hear Summary Judgment in Lawsuit
MERRILL LYNCH: Plaintiffs Dismiss Securities Lawsuit in S.D. CA
PENNSYLVANIA: University Offers To Settle Suit V. Ticket Policy
PERINI CORPORATION: Suit Settlement Hearing Set August 8, 2005
PERINI CORPORATION: MA Settlement Fairness Hearing Set Aug. 2005
RADIOSHACK CORPORATION: Faces Overtime Wage Lawsuit in IL Court
RYLAND GROUP: Shareholders Launch Securities Lawsuit in C.D. CA
SEVILLE MARKETING: Inks Settlement For FTC Test Kits Complaint
SHERWIN-WILLIAMS: Lead Paint Litigation Trial Set For Sept. 2005
SKYLINE CORPORATION: Recalls 213 Trailers For Incorrect Labels
SKYWEST AIRLINES: Parties Fail To Reach Settlement For CA Suit
SUPERCONDUCTOR TECHNOLOGIES: Reaches Settlement For CA Lawsuits
TECUMSEH PRODUCTS: Consumers Launch Fraud Suits Over Lawnmowers
TEXTRON FINANCIAL: Faces OH Suit Over Buyers' Source Financing
TROPICANA PRODUCTS: Settles FTC Lawsuit for Misleading Juice Ads
UNITED AMERICAN: Schatz & Nobel Files Investors' Suit in E.D. MI
USF CORPORATION: Red Star Employees Launch WARN Suits in PA, NY
VASO ACTIVE: Enters MOU To Settle Pending Consolidated Lawsuits
VEGAS GRAND: NV Suit Expanded, Additional Firms Join Legal Team
VIRBAC CORPORATION: Asks TX Court To Dismiss Securities Lawsuit
WASHINGTON: Court Ruling Over WTO Protests Partially Favors City
WHIRLPOOL CORPORATION: Recalls 529T Coffeemakers For Fire Hazard
XL CAPITAL: Asks CT Court To Dismiss Securities Fraud Lawsuit
XPEDITE: Seeks Partial Dismissal of MD TCPA Violations Lawsuit
ZOMAX INC.: Securities Settlement Hearing Set September 6, 2005
New Securities Fraud Cases
CARRIER ACCESS: Lerach Coughlin Files Securities Lawsuit in CO
CORN PRODUCTS: Milberg Weiss Lodges Securities Fraud Suit in IL
CORN PRODUCTS: Stull Stull Lodges Securities Fraud Lawsuit in IL
DREAMWORKS ANIMATION: Abbey Gardy Lodges Securities Suit in CA
DREAMWORKS ANIMATION: Marc S. Henzel Files Securities Suit in CA
GRAVITY CO.: Murray Frank Files Securities Fraud Suit in S.D. NY
XYBERNAUT CORPORATION: Murray Frank Lodges Securities Suit in DE
*********
AETNA INC.: Securities Settlement Hearing Set September 12, 2005
----------------------------------------------------------------
The United States District Court for the Southern District of
New York will hold a fairness hearing for the proposed
settlement in the matter: In re Aetna, Inc. Securities
Litigation, Master File No. 01-CV-9796 (THK) on behalf of all
persons or entities who purchased the firm's shares on the open
market during the period between September 1, 2000 and December
12, 2000 and December 13, 2000 and April 9, 2001.
The hearing will be held before the Honorable Theodore H. Katz
in the United States Courthouse, 500 Pearl St., New York, NY
10007, at 2:00 p.m., on September 12, 2005.
For more details, contact Deborah R. Gross, Esq. of the the Law
Offices of Bernard M. Gross, P.C. by Mail: P.C. Suite 450, the
Wanamaker Building, Juniper and Market Sts., 100 Penn Square
East, Philadelphia, PA 19107 or by Phone: 215-561-3600 OR
Salvatore J. Graziano, Esq. of Milberg Weiss Bershad Schulman,
LLP by Mail: One Pennsylvania Plaze, New York, NY 10119-0165 by
Phone: 212-594-5300 OR Jeffrey M. Haber, Esq. of Bernstein
Liebhard & Lifshitz, LLP by Mail: 10 East 40th St., New York, NY
212-779-1414 OR In re Aetna, Inc. Securities Litigation c/o
Garden City Group, Inc. by Mail: P.O. Box 9000 #6300, Merrick,
NY 11566-9000 by Phone: (800) 377-7365 or visit their Web site:
http://www.gardencitygroup.com/cases/index.html.
AMERICAN PROCESSING: TX Court Dismisses Class Claims in Lawsuit
---------------------------------------------------------------
The 100th Judicial District Court for Carson County, Texas
dismissed the class claims in the lawsuit filed against American
Processing, L.P., a former wholly-owned subsidiary of Kinder
Morgan, Inc. and now owned by ONEOK, styled "Darrell Sargent
d/b/a Double D Production v. Parker & Parsley Gas Processing
Co., American Processing, L.P. and Cesell B. Cheatham, et al.,
Cause No. 878."
The plaintiff filed a purported class action suit in 1999 and
amended its petition in late 2002 to assert claims on behalf of
over 1,000 producers who process gas through as many as ten gas
processing plants formerly owned by the Company in Carson and
Gray counties and other surrounding Texas counties. The
plaintiff claims that the Company (and subsequently, ONEOK,
which purchased the Company from Kinder Morgan in 2000)
improperly allocated liquids and gas proceeds to the producers.
In particular, among other claims, the plaintiff challenges the
methods and assumptions used at the plants to allocate liquids
and gas proceeds among the producers and processors. The
petition asserts claims for breach of contract and Natural
Resources Code violations relating to the period from 1994 to
the present. The plaintiff alleged generally in the petition
that damages are "not to exceed $200 million" plus attorneys
fees, costs and interest. The defendants filed a counterclaim
for overpayments made to producers.
Pioneer Natural Resources USA, Inc., formerly known as Parker &
Parsley Gas Processing Company is a co-defendant. Parker &
Parsley claimed indemnity from the Company based on its sale of
assets to the Company on October 4, 1995. The Company accepted
indemnity and defense subject to a reservation of rights pending
resolution of the suit. The plaintiff also named ONEOK as a
defendant.
On or about January 21, 2003, Benson-McCown & Company (Benson-
McCown), another producer who sold gas to the Company and ONEOK,
filed a "Plea in Intervention" in which it essentially
duplicated the plaintiff's claims and also asserted the right to
bring a class action and serve as one of the class
representatives. Defendants denied Benson-McCown's claim and
filed a counterclaim for overpayments made to Benson-McCown over
the years. On January 14, 2005, Defendants filed a motion to
deny class certification. Subsequently, the plaintiffs agreed to
dismiss and withdraw their class claims. An Agreed Order
Dismissing all class claims, with prejudice, was entered by the
Court on January 19, 2005. The case is proceeding on the named-
plaintiffs' individual claims, with no class action being
asserted.
APPLE COMPUTER: Opts To Settle Consolidated iPod Battery Suits
--------------------------------------------------------------
Consumers who encountered battery problems with older versions
of Apple's popular iPod digital music player are set to receive
$50 vouchers and extended service warranties under a tentative
settlement in a class action lawsuit, The Associated Press
reports.
Attorneys representing consumers in the state court case against
Apple Computer Inc. told AP that the settlement could affect as
many as 2 million people nationwide who purchased first-,
second- and third-generation iPods through May 2004.
Court documents show that in the fall of 2003, eight consumers
filed suit alleging that the iPod failed to live up to claims
that the rechargeable battery would last the product's lifetime
and play music continuously for up to 10 hours. Consumers
complained that the battery, which cost $99 to replace, lasted
18 months or less and in addition they could play music for only
four hours or less before it needed a recharge.
Environmentalists were also upset saying that the short-lived
battery encouraged consumers to dispose of their old devices,
which were ending up in landfills and possibly leaking toxins.
The iPod made its debut in 2001, with early versions costing up
to $400. Considered a must-have accessory on college campuses
and a top choice for holiday shoppers ever since, the device has
been a windfall for Cupertino-based Apple.
Under the terms of the settlement, which Apple confirmed, but
deferred immediate comment, people who fill out a claim form are
entitled to receive $50 redeemable toward the purchase of any
Apple products or services except iTunes downloads or iTunes
gift certificates. They can redeem the voucher within 18 months
of final settlement approval at any bricks-and-mortar Apple
Store or online. Additionally, the settlement also stipulates
that consumers who had battery troubles can get their battery or
iPod replaced through the lawsuit. According to a plaintiffs'
attorney, Apple replaces or repairs defective products that are
returned within one year but the class action settlement extends
the warranty to two years. It also stipulates that consumers who
file a claim must have a receipt.
As previously reported in the May 30, 2005 edition of the Class
Action Reporter, a judge in California's Superior Court for San
Mateo County initially approved the settlement of the
consolidated amended consumer class action. A judge will hold
another hearing on August 25 to give final approval.
The eight separate plaintiffs filed purported class action cases
in various California courts alleging misrepresentations by the
Company relative to iPod battery life. The suits are styled:
(1) Craft v. Apple Computer, Inc., (filed December 23,
2003, Santa Clara County Superior Court);
(2) Chin v. Apple Computer, Inc. (filed December 23, 2003,
San Mateo County Superior Court);
(3) Hughes v. Apple Computer, Inc. (filed December 23,
2003, Santa Clara County Superior Court);
(4) Westley v. Apple Computer, Inc. (filed December 26,
2003, San Francisco County Superior Court);
(5) Keegan v. Apple Computer, Inc. (filed December 30,
2003, Alameda County Superior Court);
(6) Wagya v. Apple Computer, Inc. (filed February 19, 2004,
Alameda County Superior Court);
(7) Yamin v. Apple Computer, Inc., (filed February 24,
2004, Los Angeles County Superior Court);
(8) Kieta v. Apple Computer, Inc. (filed July 8, 2004,
Alameda County Superior Court)
The complaints include causes of action for violation of
California Business and Professions Code Section 17200 (unfair
competition), the Consumer Legal Remedies Action (CLRA) and
claims for false advertising, fraudulent concealment and breach
of warranty. The complaints seek unspecified damages and other
relief.
On July 26, 2004, Plaintiffs filed a consolidated complaint. On
August 25, 2004, the Company filed an answer denying all
allegations and asserting numerous affirmative defenses.
It's unclear though how many consumers will file claims, since
plaintiffs' attorneys did no advertising other than word of
mouth when they filed the suit, however details spread to
Internet sites and blogs. Within a year, lawyers had received e-
mails and calls from more than 12,000 people who said their iPod
batteries failed to meet expectations.
According to Elizabeth C. Pritzker, an attorney at Burlingame-
based law firm Cotchett, Pitre, Simon & McCarthy LLP, which
represented two plaintiffs, consumers will be notified of the
tentative settlement in three ways: by e-mail, by letters, and
through advertisements in USA Today and Parade Magazine in the
next month. She also told AP that Apple has agreed to pay up to
$2.8 million to the two law firms that represented consumers.
Environmentalists applauded the deal but emphasized that it does
not require Apple to change the design of the iPod, which
includes lead and other hazardous materials.
ARKANSAS: Judge To Decide Status of Women's Lawsuit Over Prempro
----------------------------------------------------------------
In one of several pretrial motions he is handling for Prempro
cases across the country, U.S. District Judge Bill Wilson Jr.
recently heard arguments in Little Rock to determine whether
millions of women who took the hormone-replacement drug can be
certified in a single class action lawsuit against the drug's
manufacturer, The Arkansas Democrat Gazette reports.
According to the suit, women who have used Prempro say the
manufacturer, Madison, New Jersey-based Wyeth (NYSE: WYE)
falsely advertised the benefits and failed to acknowledge the
risks of the drug, usually prescribed to treat menopause
symptoms.
As previously reported in the March 10, 2005 edition of the
Class Action Reporter n July 2002, the critical Women's Health
Initiative study concluded that Prempro raised the risk of heart
attack, stroke, breast cancer, cardiovascular disease and
embolisms. Medical researchers also concluded the following year
that hormone replacement pills should not be taken for any
reason other than as brief treatment to help women through the
worst symptoms of menopause. These findings triggered some of
the first suits brought against Wyeth.
However, in previous court testimony, attorneys for Wyeth have
argued that most research before 2002 shows that the drug
reduced the risk of heart disease and did not affect blood
pressure or the risk of stroke. Additionally, attorneys also
said that the research regarding breast cancer was inconclusive.
The recent pretrial hearing though that is pending in Judge
Wilson's court deals with a personal injury case. Specifically,
the case involves women who took Prempro for two years and have
not shown any signs of illness but want Wyeth to fund a medical-
monitoring program to test former Prempro users for breast
cancer and dementia.
Scheduled to continue in the two next days, the hearing is not
to determine the merits of the women's claims. Instead, Judge
Wilson will hear arguments as to whether the lawsuit meets the
federal criteria for class action certification. In opening
statements, attorneys for Prempro users argued that the 14 women
they had designated as class representatives meet these
requirements, while attorneys for Wyeth argued that they do not.
Eileen McGeever, an attorney for the women, argued that Wyeth
funded a unified national campaign to promote Prempro as a
"fountain of youth." Ms. McGeever also argued that drug ads said
that Prempro, treats not only menopause symptoms but also
increases mental alertness, improves skin tone and helps the
heart. "Every one of these women saw that advertising and relied
on it when talking to their doctors," she adds, according to the
Democrat Gazette.
Lane Heard though, an attorney for Wyeth, pointed out that the
drug's advertising as well as its label have changed many times
since the drug was introduced in 1994. He further points out
that not everyone in the class was exposed to the same ads or
pamphlets, and doctors advised their patients in different ways
when prescribing Prempro. "Not every piece of advertising talked
about cardiovascular benefits," he told the Democrat Gazette.
In addition, he also noted that Prempro remains on the market as
a possible menopause medication. "It's not hazardous across the
board," he stated, pointing out that women react differently,
which also counters the commonality argument in this case.
ARTHUR ANDERSEN: Lawsuit Settlement Hearing Set July 25, 2005
-------------------------------------------------------------
The United States District Court for the Northern District of
Texas, Dallas Division will hold a fairness hearing for the
proposed $1.65 million settlement in the matter: Michael Monahan
V. Arthur Andersen, LLP, Civil Action No. 02-CV-496M on behalf
of all persons who purchased or otherwise acquired the common
stock of Intelect Communications, Inc., N/K/A Teraforce
Technology, between March 31, 1998 and November 17, 1998.
The hearing will be held on July 25, 2005, at 1:30 p.m., in room
1570 at the United States District Court for the District of
Northern Texas, 1100 Commerce St., Dallas, TX 75242.
For more details, contact Intelect Securities Litigation c/o
Berdon Claims Administrator LLC by Mail: P.O. Box 9014, Jericho,
NY 11753-8914 by Fax: (516) 931-0810 or visit their Web site:
http://http://www.berdonllp.com/claims.
CAMPUS APARTMENTS: CA Judge OKs $300T Settlement For Tenant Suit
----------------------------------------------------------------
The settlement terms of a class action lawsuit launched by
tenants of an apartment complex in Arcata, California were
recently approved by the court, thus resulting in some 250
renters sharing a portion of $300,000 award, according to the
plaintiffs' attorney, The Times-Standard reports.
The owners of Campus Apartments and Professional Property
Management, which managed the four-story, 110-unit complex
nestled next to Humboldt State University, settled the case
without admitting any wrongdoing.
Plaintiffs' attorney Michael Crowley, of the Eureka law firm of
Janssen, Malloy, Needham, Morrison, Reinholtsen and Crowley told
the Times-Standard, he was able to distribute the rent
reimbursement to 95 percent of the tenants. He added that the
amount each client received was dependent on how long they lived
in the complex between the period of March 18, 1999, and March
15, 2001, and how much they paid in rent.
Mr. Crowley told the Times-Standard that the suit arose from the
existence of structural defects, including rotten support beams
on the south balconies of the complex that existed during a two-
year period and endangered the health and safety of tenants. He
also said that structural defects were known to the complex
owner, yet no action was taken to disclose the conditions to the
tenants or to correct the problem until after the city of Arcata
posted "danger" notices that the building was deemed unsafe for
human occupancy on March 15, 2001. Tenants on the south side of
the complex were ordered to vacate the premises. "Everybody who
paid rent deserved to have some of that rent back," Mr. Crowley
said.
After more than three years of litigation, the case was settled
in July 2004 for $300,000 and in March 2005, the Humboldt County
Superior Court approved the terms of plaintiffs' final
settlement proposal. Under the terms of the settlement, $30,000
is to be evenly distributed between Legal Services of Northern
California to help fund its landlord-tenant section in Humboldt
County and the Humboldt Bay Housing Development Corp., to help
support the Humboldt Community Development Land Trust, a program
promoting affordable housing.
CANADA: Norske Skog Lodges Antitrust Suit V. 20 Chemical Firms
--------------------------------------------------------------
Norske Skog Canada Ltd., a Vancouver-based pulp-and-paper
company launched a lawsuit against 20 American and European
chemical companies for conspiring to fix the price of hydrogen
peroxide, a chemical used for bleaching pulp, textiles, laundry,
and hair, The Georgia Straight reports.
In documents filed in British Columbia Supreme Court on May 25,
Norske Skog claims that last January 31, European Commission
antitrust regulators confirmed that the EC had formally charged
18 chemical companies with fixing the prices of the product from
1994 to 2001.
Additionally, Norske Skog claims that chemical-company
executives spoke with each other to fix prices at a high level
for Canada's consumers, to suppress and eliminate competition,
to reduce the supply of hydrogen peroxide, and to submit
collusive and rigged bids for the product. Aside from
allegations of a civil conspiracy, Norske lawyer J. J. Camp also
alleged conspiracy and tortuous interference with economic
interests under the federal Competition Act.
In the meantime though, along with general cost recoveries for
artificially high-set prices, Norske Skog seeks punitive
damages, alleging the defendants' conduct was "high-handed,
outrageous, reckless, wanton, entirely without care, deliberate,
callous, disgraceful, willful, in contumelious disregard of the
plaintiff's rights".
Norske Skog, which bought millions of dollars' worth of the
chemical in the past decade, told Georgia Straight that it will
try to convert the action into a class action suit for all
people who bought hydrogen peroxide in British Columbia since
1994. The product is also used for minor wounds, in baths, as a
mouthwash and food rinse, and in sexual practices to prevent
sexually transmitted diseases.
CHIRON CORPORATION: Plaintiffs File Consolidated Securities Suit
----------------------------------------------------------------
Plaintiffs filed a consolidated securities class action against
Chiron Corporation and certain of its officers in the United
States District Court for the Northern District of California.
Between October 2004 and December 2004, five securities class
action lawsuits were filed on behalf of purchasers of Company
securities for class periods ranging from July 23, 2003 through
October 13, 2004. Four of the suits were filed in the United
States District Court for the Northern District of California.
One action, although originally filed in the United States
District Court for the Eastern District of Pennsylvania, was
later transferred to the United States District Court for the
Northern District of California.
In March 2005, the Court named lead counsel, and in April 2005,
plaintiffs filed a consolidated complaint. Plaintiffs allege,
among other things, that the defendants violated certain
provisions of the federal securities laws by making false
statements preceding the suspension of the Company's license to
manufacture FLUVIRIN vaccine, and seek unspecified monetary
damages and other relief from all defendants. The trial is
scheduled to begin on May 1, 2006.
The consolidated suit is styled "Richard Gregory, et al. v.
Chiron Corporation, et al., case no. 04-CV-04293," filed in the
United States District Court for the Northern District of
California. The plaintiff firms in this litigation are:
(1) Milberg Weiss Bershad & Schulman LLP, 355 South Grand
Avenue, Suite 4170, Los Angeles, CA, 90071, Phone:
213.617.9007, Fax: 213.617.9185, E-mail:
info@milbergweiss.com
(2) 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
CHIRON CORPORATION: County of Nassau Files Amended MA AWP Suit
--------------------------------------------------------------
The County of Nassau filed an amended class action against
Chiron Corporation and other biotechnology and pharmaceutical
companies in the United States District Court for the District
of Massachusetts, in connection with setting average wholesale
prices for various products, including the Company's TOBI
solution, which are reimbursed by Medicaid.
The suit alleges improper or fraudulent reporting practices
related to the reporting of average wholesale prices of certain
products, and that the defendants committed other improper acts
in order to increase prices and market shares. The suit is
styled "In re: Pharmaceutical Industry Average Wholesale Price
Litigation, MDL Docket No. 1456."
The consolidated amended complaint alleges that the defendants'
acts improperly inflated the reimbursement amounts paid by
various public and private plans and programs. The amended
complaint alleges claims on behalf of a purported class of
plaintiffs that paid any portion of the price of certain drugs,
which price was calculated based on its average wholesale price,
or contracted with a pharmacy benefit manager to provide others
with such drugs.
The suit is styled "County of Nassau v. Abbott Laboratories,
Inc. et al, case no. 1:05-cv-10179-PBS," filed in the United
States District Court for the District of Massachusetts, under
Judge Patti B. Saris. Representing the plaintiffs are Michael
M. Buchman and Melvyn I. Weiss, Milbert, Weiss, Bershad, Hynes &
Lerach, LLP, One Pennsylvania Plaza, New York, NY 10119-0165,
Phone: 212-594-5300, Fax: 212-868-1229, E-mail:
mbuchman@milbergweiss.com.
COMDISCO INC.: Securities Settlement Hearing Set July 14, 2005
--------------------------------------------------------------
The United States District Court for the Northern District of
Illinois, Eastern Division will hold a fairness hearing for the
proposed $13.75 million settlement in the matter: In re
COMDISCO, Inc. Securities Litigation, Master Files No. 01 C 2110
on behalf of all persons and entities who purchased the common
stock of COMDISCO, Inc. during the period November 3, 1999,
through and including October 3, 2000.
The Final Settlement hearing will be held before the Honorable
Milton I. Shadur, on July 14, 2005, at 9:30 a.m., in Courtroom
2303 of the United States District Court for the Northern
District of Illinois, Everett McKinley Dirksen United States
Courthouse, 219 South Daerborn St., Chicago, IL 60604.
For more details, contact Adam j. Levitt, Esq. of Wolf
Haldenstein Adler Freeman & Herz, LLC by Mail: 55 West Monroe
St., Suite 1111, Chicago, Illinois 60603 by Phone:
(312) 984-0000 OR In re COMDISCO, Inc. Securities Litigation c/o
The Garden City Group, Inc., Claims Administrator, P.O. Box 9000
#6308, Merrick New York 11566-9000 by Phone: (800) 336-0045 or
visit their Web site:
http://www.gardencitygroup.com/cases/index.html.
CRYOLIFE INC.: Seeks Summary Judgment in Securities Suit in GA
--------------------------------------------------------------
Cryolife, Inc. moved for summary judgment in the consolidated
securities class action filed against it and certain of its
officers in the United States District Court for the Northern
District of Georgia.
Several putative class action lawsuits were filed in July
through September 2002 against the Company and certain officers
of the Company, alleging violations of Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934 based on a series of
purportedly materially false and misleading statements to the
market. The suits were consolidated, and a consolidated amended
complaint filed, that principally alleges that the Company made
misrepresentations and omissions relating to product safety and
the Company did not comply with certain FDA regulations
regarding the handling and processing of certain tissues and
other product safety matters. The consolidated complaint seeks
certification of a class of purchasers between April 2, 2001 and
August 14, 2002, compensatory damages, and other expenses of
litigation.
The Company and the other defendants filed a motion to dismiss
the consolidated complaint on February 28, 2003, which motion
the court denied in part and granted in part on May 27, 2003.
The discovery phase of the case commenced on July 16, 2003. On
December 16, 2003 the Court certified a class of individuals and
entities who purchased or otherwise acquired Company stock from
April 2, 2001 through August 14, 2002. On March 11, 2005
defendants moved for summary judgment on all of plaintiffs'
claims, and plaintiffs moved for partial summary judgment as to
some of their claims against certain defendants.
The suit is styled "Robert Murray and Richard A. Pearson,
individually and on behalf of all others similarly situated v.
Cryolife, Inc., Steven G. Anderson, Albert E. Heacox, James C.
Vander Wyk and D. Ashley Lee," and pending in the United States
District Court for the Northern District of Georgia, Atlanta
Division. Attorneys for the plaintiffs are:
(1) Martin D. Chitwood and Nikole Davenport of Chitwood &
Harley, Mail: 2900 Promenade II, 1230 Peachtree Street,
NE Atlanta, Georgia 30309, Phone: 404-873-3900, Fax:
404-876-4476
(2) Sherrie R. Savett, Carole A. Broderick, Barbara A.
Podell, David F. Sorensen of Berger & Montague PC, 1622
Locust Street, Philadelphia, PA 19103, Phone: 215-875-
3000, Fax: 215-875-4604
For more information, visit
http://securities.stanford.edu/1024/CRY02-
01/20020827_o01c_022388.pdf
DREAMWORKS ANIMATION: Shareholders Files CA Suit Over DVD Sales
---------------------------------------------------------------
DreamWorks Animation SKG faces its first ever shareholder
lawsuit since going public accusing company officers of
misrepresenting DVD sales for "Shrek 2," The Reuters News Agency
reports.
The lawsuit, which is a proposed class action, was filed in Los
Angeles federal court. It specifically accuses DreamWorks Chief
Executive Jeffrey Katzenberg and board Chairman Roger Enrico of
failing to disclose in the first quarter that sales of "Shrek 2"
DVDs were declining far more than expected. According to the
suit, DreamWorks continued to ship the title "far in excess of
the actual demand" and hid the fact that retailers were
returning "massive amounts" of unsold DVDs.
DreamWorks spokesman Bob Feldman told Reuters that the company
had not seen the lawsuit but called the claims "baseless." He
adds, "We believe the suit is completely without merit and we
intend to defend ourselves vigorously."
DreamWorks Animation stunned investors on May 10, the company's
first-quarter earnings call, by reporting that first-quarter DVD
sales for "Shrek 2" fell far short of the company's earlier
projections and that the Glendale, California, studio would
realize no revenue from the title in the quarter. In that
earnings call, Mr. Katzenberg said DreamWorks had overestimated
retail sales of "Shrek 2," and had been saddled with returns of
unsold discs from retail outlets. As a result of that
announcement, DreamWorks shares were sent tumbling by 12
percent, or $4.45, the next trading day, to close at $32.05 on
the New York Stock Exchange.
Mr. Feldman told Reuters, "Shrek 2," which broke all box office
records for an animated feature last year, sold 33.7 million DVD
units in the holiday fourth quarter. He also added that despite
sluggish first-quarter sales of 1.3 million units, DreamWorks
has not revised its projection for worldwide "Shrek 2" DVD sales
of 40 million units. To date, according to Mr. Feldman, "Shrek
2" has logged sales of 35 million.
Shares of DreamWorks Animation dropped another 7 percent on
Tuesday and were trading at $29.74 on Thursday, after last
weekend's theatrical debut of "Madagascar" failed to meet
analysts' expectations.
FIRST AMERICAN: Court Case Launched in IL Over Closing Charges
--------------------------------------------------------------
First American Title Insurance Company faces a class action
lawsuit by Peter Fiore in St. Clair County Circuit Court, which
alleges that the company misrepresented closing charges, The
Madison County Record reports.
The suit claims that Mr. Fiore, who is asking that his case be
maintained as a class action for residents of 31 states, had
used First American to purchase title insurance for refinancing
his home in 2003 in Stookey Township and was billed $1,639.09
for the service.
Court documents show that class members seek less than $75,000.
In order for the suit to meet state court filing criteria as
prescribed by the Class Action Fairness Act signed into law by
President Bush in February class members outside of Illinois are
not seeking more than $5 million.
According to Mr. Fiore's complaint, First American violated the
Illinois Consumer Fraud and Deceptive Practices act by
misrepresenting the actual cost of certain closing charges
including credit reports, tax service contracts to the lender,
flood certification fees, settlement or closing fees, recording
fees, wire transfer fees and delivery fees. Mr. Fiore also
claims that First American concealed or suppressed the fact that
its title insurance closing costs were not in compliance with
Illinois law. He says the title company failed to disclose and
charge the actual costs and retained money in excess of the
actual costs.
The complaint states, "First American has failed to disclose
information at Plaintiff's request concerning this matter,
thereby making damages appropriate with respect to the class as
a whole. The conduct was deceptive, fraudulent, unfair and
misleading,"
Residents of Alabama, Arkansas, California, Colorado,
Connecticut, Delaware, Florida, Georgia, Indiana, Illinois,
Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan,
Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, New
Jersey, New Mexico, New York, North Carolina, Pennsylvania,
Rhode Island South Carolina, Texas, Washington, Wisconsin, and
the District of Columbia make up the class. Jeffrey Hammel of
Belleville will represent the class.
FRANCE: DVD Suit Targets Major Video Production Companies
---------------------------------------------------------
A group of people, who launched a class action suit in France
against the major video production companies, started a web
site, http://www.classaction.fr/actions/action1/service1.htm,
asking others to join them in their fight, The p2pnet.net News
reports.
The group's case against Warner Bros France, Gaumont Columbia
Tristar Home Video, Fox Pathe Europa, TFI Video, Buena Vista
Home Entertainment and Universal Pictures France, who together
account for 85% of the French DVD market, rests on four points
stemming from the principal argument which states that when you
buy a DVD in France, the law assumes you may want to make a copy
for your own use and, consequently, the price you've paid
includes a tariff which is collected in the name of authors and
performers rights.
The suit's four points are:
(1) The copy protection measures stop you from making
copies of DVDs you have purchased (as allowed by the
French laws);
(2) Every time you buy a DVD you've been charged a fee for
authors' rights, the benefits of which you cannot
enjoy;
(3) Video producers mislead you into believing that you can
not make a copy of your DVD; and
(4) Video producers do not make it clearly evident that
their product includes copy protection.
The group's attorney, MaŚtre Emmanuel Jacques, has asked for a
hearing on June 13. He is demanding 1,000 ? ($1,227) per person
in view of the charges, with a further 250 ? ($307) per person
payable under Article 700 of the 'Nouveau Code de Proc‚dure
Civile'.
Among those lodging the suit is an unidentified mother, who
states, "I have a none-year-old son who's crazy about comics. We
have a DVDplayer as well as an old video player, which we've put
in his room. Unfortunately, the comics which we have bought in
DVD format can't be copied onto video cassettes and therefore my
son "monopolizes" the DVD player and the TV in our living room."
GENERIC VALUE: Recalls 20T Straightening Iron Due to Burn Hazard
----------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Generic Value Products, of Omaha, Nebraska and Sally
Beauty Company Inc., of Denton, Texas is voluntarily recalling
about 20,000 GVPT Ceramic Hair Straightening Iron.
The heated ceramic plates on these irons can loosen and detach
during use, posing a risk of burn injuries to consumers. Generic
Value Products has received 38 reports of the ceramic plate in
these irons overheating and detaching from the plastic housing,
including two minor skin burns from a detached plate.
This hair straightening iron has a black housing with golden-
colored ceramic heating plates. "Generic Value ProductsT" is
written on the top of the iron and "GVPT" is written in a white
circle on the side of the iron. The iron was packaged in a black
and white box with the letters GVPT in large type in the upper
left hand front corner. The SKU is 264800, which is written on
the packaging.
Manufactured in South Korea the irons were sold at all Sally
Beauty Supply stores nationwide and Puerto Rico from March 21,
2005 through April 5, 2005 for about $70.
Consumers should stop using these irons immediately and return
them to any Sally Beauty Supply store for a full refund or
exchange for a different straightening iron.
Consumer Contact: Call Generic Value Products toll-free at
(800) 526-3009 between 8:30 a.m. and 5 p.m. CT Monday through
Friday, or go to their Web site: http://www.GVPrecall.com.
GILEAD SCIENCES: Plaintiffs File Amended Securities Suit in CA
--------------------------------------------------------------
Plaintiffs filed a third amended securities class action against
Gilead Sciences, Inc. in the United States District Court for
the Northern District of California. The suit also names as
defendants the Company's Chief Executive Officer, Chief
Financial Officer, former Executive Vice President of Operations
(and current Senior Business Advisor), Executive Vice President
of Research and Development, and Senior Vice President of
Manufacturing and Research.
The complaint alleges that the defendants violated the federal
securities laws, specifically Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 of the Securities
and Exchange Commission, by making certain alleged false and
misleading statements. The plaintiff seeks unspecified damages
on behalf of a purported class of purchasers of the Company's
securities during the period from July 14, 2003 through October
28, 2003.
Other similar actions were subsequently filed and the court
issued an order consolidating the lawsuits into a single action
on December 22, 2003. On February 9, 2004, the court issued an
order appointing lead plaintiffs in the consolidated action. On
April 30, 2004 lead plaintiffs, on behalf of the purported
class, filed their consolidated amended complaint. On June 21,
2004 the Company and individual defendants filed their motion to
dismiss the consolidated amended complaint. On January 4, 2005
the court granted defendants' motion to dismiss with leave to
amend. Plaintiffs filed a Second Amended Complaint on February
25, 2005. On March 11, 2005 Plaintiffs filed a Third Amended
Complaint. Defendants will file a motion to dismiss this
complaint by May 10, 2005 and the matter is to be heard on
September 27, 2005. No trial date has been scheduled.
The suit is styled "In re Gilead Sciences Securities litigation,
case no. 03-CV-4999," filed in the United States District Court
for the Northern District of California under Judge Martin J.
Jenkins. The plaintiff firms in this litigation are:
(1) Geller Rudman, PLLC, 197 South Federal Highway, Suite
200, Boca Raton, FL, 33432, Phone: 561.750.3000, Fax:
888.262.3131, E-mail: info@geller-rudman.com;
(2) Kaplan Fox & Kilsheimer, LLP (San Francisco, CA), 100
Pine Street, 26th Floor, San Francisco, CA, 94111,
Phone: 415.772.4700, Fax: 415.677.1233, E-mail:
info@kaplanfox.com
(3) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(4) Milberg, Weiss, Bershad, Hynes & Lerach LLP (Seattle,
WA), 1001 Fourth Avenue - Suite 3200, Seattle, WA,
98154, Phone: 206.839.0730,
GREAT LAKES: Faces Litigation Due To GA Facility May 2004 Fire
--------------------------------------------------------------
Great Lakes Chemical Corporation is working to settle litigation
filed in connection with the fire at its Conyers, Georgia
warehouse on May 25,2004.
Five class actions were initially filed against the Company and
certain of its officers and employees in three counties in
Georgia pertaining to the fire, including the Davis case in
Rockdale County, the Burtts and Hill cases in Fulton County and
the Chapman and Brown cases in Gwinnett County. These suits
seek recovery for economic and non-economic damages allegedly
suffered as a result of the fire.
The Company established a claims settlement process within one
day of the fire to resolve all legitimate economic and personal
injury claims raised by residents and businesses in Rockdale
County, Georgia. While attorneys for certain plaintiffs
attempted to stop this process, the Rockdale Superior Court
ordered that the claims process continue in the interests of the
citizens of that county.
At the time of the fire, the Company maintained, and continues
to maintain, property and general liability insurance. While
the overall amount of damages caused by the fire to all third
parties cannot be ascertained at this time, the Company recorded
approximately $5 million in other income (expense) - net in 2004
for claims. The Company also incurred approximately $4 million
of legal and claims processing fees in 2004 that were not
reimbursable under the general liability policy.
On March 29, 2005, the plaintiffs filed an alleged class action
lawsuit in the United States District Court for the Northern
District of Georgia, the Martin case, seeking recovery of
damages allegedly caused by the May 2004 fire. In addition, the
Martin plaintiffs seek a declaratory judgment to void, as a
matter of law, all settlements executed to date. The Company
has filed a motion to dismiss the Martin case on jurisdictional
grounds. The plaintiffs have previously attempted to
voluntarily dismiss the Davis and Burtts cases. The Company
successfully opposed the dismissal of the Davis case and the
plaintiffs continue to appeal that outcome. Recently, the
plaintiffs filed motions to voluntarily dismiss three other
cases, the Hill, Brown and Chapman cases, indicating their
preference to proceed with all claims included in the Martin
federal court action.
HAWAII: Former Prisoners Win $1.2M Award Over Long Imprisonment
---------------------------------------------------------------
U.S. Magistrate Leslie Kobayashi approved a $1.2 million
settlement to be paid by the state of Hawaii to possibly
hundreds of prisoners held behind bars when they should have
been released, The Honolulu Advertiser reports. The federal
magistrate, who called the settlement "fair, reasonable and
adequate," said that settlement avoids a lengthy and expensive
trial.
As reported in the June 3, 2005 edition of the Class Action
Reporter, several hundred former state prisoners, who were kept
in their cells despite being cleared, or after their sentences
expired, may receive thousands of dollars from the state. In the
class action settlement, the state agreed to money payments to
prisoners and to improve procedures for releasing inmates.
Volunteer American Civil Liberties Union lawyers Mark Davis and
Susan Dorsey on behalf of inmates held in state correctional
facilities from December 1999 to December 2002 after they were
supposed to be released filed the class action lawsuit in
federal court in 2001.
Of the $1.2 million, $400,000 will be paid to the ACLU and
lawyers for legal fees and costs and up to $100,000 will be paid
to claims administrator Elbridge Smith, who will evaluate the
claims. That leaves at least $700,000 for the former inmates,
who could get $1,000 for every day their release was delayed and
another $3,000 if they were strip-searched. Court documents
indicate that another half million will go to attorneys, and the
costs of bringing the lawsuit and managing the claims.
The claims deadline is next month and if inmates do not claim
all of the money, the University of Hawaii law school will get
the rest of it, which the lawyers estimated will be at least
$50,000. It will go to the law school's projects that seek to
provide legal help for prisoners.
Deputy Attorney General Kendall Moser told the Advertiser that
the state reviewed the release of about 20,000 to 22,000
prisoners during the three-year period and estimated the number
of claimants to be as high as 200. But Mr. Davis said his
estimate is that as many as 600 can file claims.
Ms. Dorsey also told the Advertiser that although many claimants
will be getting about $5,000, she understood that two claimants
were held for about 90 days, which would mean each would be
getting $90,000. If the claims exceed the money available
though, the amounts to the clients will be reduced on a prorata
basis, Mr. Davis adds.
In addition to the monetary aspect of the settlement, the state
also agreed to make improvements to ensure that inmates are
released on time. According to Deputy A.G. Moser, "We hope with
the settlement of this lawsuit that everything will be working
the way it ought to be and inmates will get released when they
should get released."
INTERNATIONAL PAPER: SC Court Refuses To Dismiss Antitrust Suit
---------------------------------------------------------------
The United States District Court in Columbia, South Carolina
refused to dismiss the class action filed against International
Paper Co. and certain of its fiber suppliers, known as "quality
suppliers," alleging an unlawful conspiracy to artificially
depress the prices at which the Company procures fibers for its
mills. The suit seeks injunctive relief as well as treble
damages and other costs associated with the litigation.
On March 31, 2004, the case was certified as a class action.
The Company filed for permission from the U.S. Court of Appeals
for the Fourth Circuit to appeal the District Court's order
granting class certification, but that request was denied. In
January 2005, the Company filed motions requesting dismissal of
the plaintiff's claim based on plaintiffs' lack of standing to
sue and for decertification of the class. These motions were
denied on April 7, 2005. Discovery and issues concerning class
notice are ongoing.
INTERNATIONAL TRUCK: Recalls 3288 Vehicles Due to Brake Defect
--------------------------------------------------------------
International Truck & Engine Corporation in cooperation with the
National Highway Traffic Safety Administration's Office of
Defects Investigation (ODI) is voluntarily recalling about 3288
service brakes of 2006 International 3200/4000/7000/8000
vehicles.
According to the ODI, on certain vehicles equipped with air
brakes, the push rod that connects the brake pedal to the brake
valve was manufactured incorrectly and could break under certain
loading conditions. If these push rod breaks while a vehicle is
in operation, a partial loss of service braking may be
experienced. This could result in a vehicle crash without
warning. As a remedy dealers will replace the push rods.
For more details, contact International by Phone: 1-800-448-7825
or the NHTSA Auto Safety Hotline: 1-888-327-4236.
ITEX CORPORATION: OR Court Sets June 22, 2005 Claims Deadline
-------------------------------------------------------------
The United States District Court for the District of Oregon
entered an order that establishes a deadline of June 22, 2005,
as the last date by which all persons or entities asserting
claims against or right of distribution from the receivership
estate established to distribute proceeds from the lawsuit,
Securities and Exchange Comission V. Terry L. Neal, ITEX
Corporation et al., U.S.D.C. Case No. CV 99-1361-BR. The Suit
arises from the plaintiffs' purchase of ITEX stock from May 9,
1994 through and including March 24, 1997.
For more details, contact Michael A. Grassmueck of Michael A.
Grassmueck, Inc. by Mail: P.O. Box 1050, Portland, OR 97207 or
by Phone: (503) 294-1018.
KINDER MORGAN: CO Court Holds Suit Settlement Fairness Hearing
--------------------------------------------------------------
The United States District Court for the District of Colorado
heard the motion seeking approval of the settlement of the
securities class action filed against Kinder Morgan, Inc.,
styled "Lamb v. Kinder Morgan, Inc., et al., Civil Action No.
00-M-516, (formerly "Adams v. Kinder Morgan, Inc. et al.").
The case was originally filed on March 8, 2000 and is a
purported class action. As of this date no class has been
certified. Plaintiffs seek compensatory damages against all
defendants jointly and severally, together with interest,
attorney fees and expenses. The plaintiffs brought claims
alleging securities fraud under Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 on behalf of all people who
purchased the common stock of the Company during the class
period from October 30, 1997 to June 21, 1999. The class period
occurred prior to the installation of the Company's current
management team in October 1999.
The complaint centers on allegations of misleading statements
concerning operations of the Bushton Processing Plant and
certain contracts, as well as allegations of overstatement of
income in violation of accounting principles generally accepted
in the United States of America during the class period.
On February 23, 2001, the federal district court dismissed
several claims raised by the plaintiff, with prejudice, and
dismissed the remaining claims, without prejudice. On April 27,
2001, the Adams plaintiffs filed their second amended complaint.
On March 29, 2002, the federal district court dismissed the
Adams plaintiffs' second amended complaint with prejudice. On
May 2, 2002, the Adams plaintiffs appealed the dismissal to the
10th Circuit Court of Appeals. In a published decision, on
August 11, 2003, the appeals court reversed the district court's
dismissal, but upheld the dismissal of Richard Kinder, the
Company's Chairman and Chief Executive Officer, from this
action. The mandate from the appeals court was issued on October
17, 2003. Briefing regarding class certification is complete
and a decision is pending. Merits discovery commenced on June
7, 2004. The Court granted James E. Adams' motion to withdraw as
a lead plaintiff. As a result, the case is now styled as "Lamb
v. Kinder Morgan, Inc. et al."
The parties reached a settlement in principle of this matter and
have signed a Memorandum of Understanding. The settlement
documents were preliminarily approved by the Court on February
23, 2005.
The suit is styled "Adams, et al v. Kinder-Morgan, Inc., et al,
case no. 1:00-cv-00516-EWN-PAC," filed in the United States
District Court for the District of Colorado, under Judge Edward
W. Nottingham. Representing the plaintiffs are:
(1) Eric A. Beltzer, Gary C. Davenport and John T. Mauro,
McGloin, Davenport, Severson and Snow, 1600 Stout
Street, #1600, Denver, CO 80202-3144 U.S.A, Phone: 303-
863-9800, E-mail: johnmauro@mdsslaw.com
(2) Norman Berman and Mike G. Lange, Berman, DeValerio,
Pease, Tabacco, Burt & Pucillo-MA, One Liberty Square,
8th Floor, Boston, MA 02109, U.S.A., Phone: 617-542-
8300
(3) Curtis V. Trinko, Curtis V. Trinko, LLP, 16 West 46th
Street 7th Floor, New York, NY 10036 U.S.A Phone: 212-
490-9550, Fax: 986-0158
Representing the Company are:
(i) Clifford K. Atkinson, Atkinson & Thal, P.C., 201 Third
Street, N.W. #1850, Albuquerque, NM 87102, U.S.A,
Phone: 505-764-8111
(ii) Michael Lance Beatty, Michael Noone, John S. Thal,
Beatty Law Firm, PC, 216 16th Street #1100, Denver, CO
80202-5115 U.S.A., Phone: 303-407-4499, Fax: 303-407-
4494, E-mail: mnoone@beattylaw.com
(iii) Susan E. Chetlin, Dahl & Oserloth, L.L.P., 555
Seventeenth Street, #3405 Denver, CO 80202 U.S.A.,
Phone: 303-291-3200, Fax: 291-3201
LAFARGE CANADA: Seeks Certiorari For Certification of MI Lawsuit
----------------------------------------------------------------
LaFarge Canada, Inc. filed a petition for certiorari with the
United States Supreme Court related to the class action filed
against it, on behalf of individuals living in Alpena, Michigan.
The suit, filed in April 1999 in the United States District
Court for the Eastern District of Michigan, alleges personal
injury and property damages allegedly stemming from certain
emissions which plaintiffs claim originated from the Company's
cement manufacturing plant in Alpena. On October 24, 2001, the
trial court ordered that the case could proceed as a class
action on behalf of all persons who owned single family
residences in Alpena from April 1996 to the present who have
suffered damage from emissions from the Alpena plant.
The Company appealed the court's decision on several grounds,
including that the court did not have jurisdiction over the
putative class as not all class members' claims satisfied the
$75,000 amount in controversy for diversity jurisdiction. On
September 7, 2004, a Panel of the United States Court of Appeals
for the Sixth Circuit affirmed the lower court's order of class
certification. On September 21, 2004, the Company petitioned the
Sixth Court for Rehearing and Rehearing En Banc. The petition
was denied. The U.S. Supreme Court previously granted petitions
for certiorari in two unrelated cases involving the
jurisdictional question at issue in the Company case, and the
Company petitioned the Supreme Court for certiorari to address
the issue in the case.
MAGNUM HUNTER: Enters Into MOU For Lawsuit Over Cimarex Merger
--------------------------------------------------------------
Magnum Hunter Resources, Inc. (NYSE: MHR) entered into a
memorandum of understanding with counsel to the plaintiffs in a
lawsuit related to its proposed merger with Cimarex Energy Co.
(NYSE: XEC).
The lawsuit was filed on February 2, 2005 as a class action
complaint in the District Court in Clark County, Nevada, naming
as defendants Magnum Hunter and each of its directors.
Under the terms of the memorandum, the parties have agreed,
subject to approval by the court, to enter into a settlement
with respect to all claims raised, or which could be raised, by
the plaintiffs to the lawsuit. If the court approves the
settlement contemplated in the memorandum, the lawsuit will be
dismissed. The terms of the settlement contemplated by the
memorandum require that additional disclosure be made concerning
the merger. This disclosure is contained in a Form 8-K filed by
Magnum Hunter today with the Securities and Exchange Commission.
The parties also agreed that plaintiffs may seek attorneys' fees
and expenses in an amount not to exceed in the aggregate
$400,000 that Magnum Hunter will pay if the attorneys' fees and
expenses are granted by the court. There will be no other
settlement payment by Magnum Hunter. However, there can be no
assurance that the court will approve the proposed settlement or
that any ultimate settlement will be under the same terms as
those contemplated by the memorandum.
The proposed merger remains subject to the satisfaction of
closing conditions, including approval by the shareholders of
both Magnum Hunter and Cimarex. As previously announced,
meetings of Magnum Hunter and Cimarex shareholders to vote on
the merger are scheduled for June 6, 2005. If shareholder
approval is obtained and all other closing conditions are
satisfied, the parties anticipate that the closing of the merger
will occur on or about June 7, 2005.
For more details, contact Cimarex Energy Co., Paul Korus, Vice
President & CFO by Phone: 303-295-3995 OR Magnum Hunter
Resources, Inc., Howard Tate, Vice President of Capital Markets
by Phone: 972-401-0752.
MARSH & MCLENNAN: Working on NYAG Probe, Civil Suit Settlement
--------------------------------------------------------------
Marsh & McLennan Companies, Inc. is still working on the
settlement of the investigation and civil complaint filed by the
Office of the New York State Attorney General (NYAG) Eliot
Spitzer over broker compensation arrangements, generally and
compensation under placement or market service agreements,
specifically.
In April 2004, the NYAG commenced an investigation, and issued a
subpoena to the Company on April 7, 2004. The NYAG followed
with additional subpoenas in the summer and fall of 2004. On
October 14, 2004, NYAG filed a civil complaint in New York State
court against the Company and Marsh Inc. (collectively "Marsh")
asserting claims under New York law for fraudulent business
practices, antitrust violations, securities fraud, unjust
enrichment, and common law fraud.
The complaint alleged that market service agreements between
Marsh and various insurance companies (the "Agreements"),
created an improper incentive for Marsh to steer business to
such insurance companies and to shield them from competition.
The complaint further alleged that these Agreements were not
adequately disclosed to Marsh's clients or to Marsh's investors.
In addition, the complaint alleged that Marsh engaged in bid-
rigging and solicited fraudulent bids to create the appearance
of competitive bidding. The complaint sought relief that
included an injunction prohibiting Marsh from engaging in the
alleged wrongful conduct, disgorgement of all profits related to
such conduct, restitution and unspecified damages, attorneys'
fees, and punitive damages.
On October 21, 2004, the New York State Insurance Department
(the "NYSID") issued a citation, amended on October 24, 2004
(the "Amended Citation"), that ordered the Company and a number
of its subsidiaries and affiliates that hold New York insurance
licenses to appear at a hearing and show cause why regulatory
action should not be taken against them. The amended citation
charged the respondents with the use of fraudulent, coercive and
dishonest practices; violations of Section 340 of the New York
General Business Law relating to contracts or agreements for
monopoly or in restraint of trade; and violations of the New
York Insurance Law that resulted from unfair methods of
competition and unfair or deceptive acts or practices. The
Amended Citation contemplated a number of potential actions the
NYSID could take, including the revocation of licenses held by
the respondents.
On October 25, 2004, NYAG announced that it would not bring
criminal charges against Marsh. On January 30, 2005, Marsh
entered into an agreement (the "Settlement Agreement") with NYAG
and the NYSID to settle the NYAG Lawsuit and the Amended
Citation.
Pursuant to the Settlement Agreement, Marsh will establish a
fund of $850 million (the "Fund"), payable over four years, for
Marsh policyholder clients. As a general matter, U.S.
policyholder clients who retained Marsh to place insurance
between 2001 and 2004 that resulted in Marsh receiving market
service revenue will be eligible to receive a pro rata
distribution. No showing of fault, harm or wrongdoing is
required in order to receive a distribution. No portion of the
Fund represents a fine or penalty against Marsh and no portion
of the Fund will revert to Marsh. Clients who voluntarily elect
to participate in the Fund will tender a release relating to the
matters alleged in the NYAG Lawsuit or the Amended Citation,
except for claims which are based upon, arise out of or relate
to the purchase or sale of Marsh securities. The Settlement
Agreement further provides that Marsh will not seek or accept
indemnification pursuant to any insurance policy for amounts
payable pursuant to the Settlement Agreement.
Marsh also agreed to undertake the following business reforms
within 60 days of the date of the Settlement Agreement:
(1) Marsh will accept compensation for its services in
placing, renewing, consulting on or servicing any
insurance policy only by a specific fee paid by the
client; or by a specific percentage commission on
premium to be paid by the insurer; or a combination of
both. The amount of such compensation must be fully
disclosed to, and consented to in writing, by the
client prior to the binding of any policy;
(2) Marsh must give clients prior notification before
retaining interest earned on premiums collected on
behalf of insurers;
(3) In placing, renewing, consulting on or servicing any
insurance policy, Marsh will not accept from or request
of any insurer any form of contingent compensation;
(4) In placing, renewing, consulting on or servicing any
insurance policy, Marsh will not knowingly use
wholesalers for the placement, renewal, consultation on
or servicing of insurance without the agreement of its
client;
(5) Prior to the binding of an insurance policy, Marsh will
disclose to clients all quotes and indications sought
or received from insurers, including the compensation
to be received by Marsh in connection with each quote.
Marsh also will disclose to clients at year-end Marsh's
compensation in connection with the client's policy;
and
(6) Marsh will implement company-wide written standards of
conduct relating to compensation and will train
relevant employees in a number of subject matters,
including business ethics, professional obligations,
conflicts of interest, anti-trust and trade practices
compliance, and record keeping.
The Company's Board of Directors has established a committee of
the Board to monitor compliance with the standards of conduct
regarding compensation from insurers and will make quarterly
reports to the Board of the results of its monitoring activity
for a period of five years. The Settlement Agreement further
provides that Marsh reserves the right to request that NYAG and
the NYSID modify the Settlement Agreement if compliance with any
portion thereof proves impracticable.
Though Mercer Inc. ("Mercer") was not a defendant in the NYAG
Lawsuit, U.S. policyholder clients that retained Mercer to
place, renew, consult on or service insurance between 2001 and
2004 that related to Mercer receiving contingent commissions or
overrides are eligible to participate in the Fund. On April 28,
2005, the parties entered into Amendment No. 1 to the Settlement
Agreement, which modifies the scope of the application of the
business reforms provisions with respect to MMC operations
outside the United States.
On January 6, 2005, NYAG filed a felony complaint against former
Marsh employee Robert Stearns as to which Mr. Stearns has
entered a guilty plea. On February 15, 2005 and February 24,
2005, former Marsh employees, Joshua Bewlay and Kathryn Winter,
respectively, pled guilty to certain claims.
The Settlement Agreement does not resolve any investigation,
proceeding or action commenced by NYAG or NYSID against any
former or current employees of Marsh. As part of the Settlement
Agreement, Marsh apologized for the improper conduct of certain
employees. Marsh also agreed to continue to cooperate with NYAG
and NYSID in connection with their ongoing investigations of the
insurance industry, and in any related proceedings or actions.
NYAG has publicly stated that additional charges and/or guilty
pleas involving Marsh personnel and others are highly likely.
Investigations by the offices of attorneys general in 18
jurisdictions, and the departments of insurance or other state
agencies in 29 other jurisdictions remain pending.
MASSACHUSETTS: Suit Filed V. HN Crematorium, Local Funeral Homes
----------------------------------------------------------------
Lorraine Hunt launched a lawsuit against a New Hampshire
crematorium and Massachusetts funeral homes in the first federal
complaint filed since the crematorium was shut down by
authorities in February, The Associated Press reports.
Ms. Hunt, who alleges that her father's remains were mishandled,
filed the complaint in U.S. District Court. Her suit bares a
striking resemblance to recent complaints in state courts that
seek certification as class action complaints on behalf of
customers of funeral homes that contracted with the crematorium.
The suit, which seeks damages for negligence, intentional
emotional distress and other alleged breaches of trust, alleges
that Bayview Crematory "commingled bodies while they were
cremated, failed to keep accurate records of the bodies" and
either failed to return remains to families or returned them in
urns mixed with the ashes from other bodies. It specifically
alleges that the remains of Ms. Hunt's father, Robert Lowe
Cashman, were mishandled in April 2004 after they were entrusted
with a Quincy funeral home, Hamel, Wickens & Troupe and taken to
the crematorium in Seabrook, New Hampshire. Additionally, the
complaint contends that the funeral homes "turned a willful
blind eye" to the problems at Bayview and were "motivated by
greed" to use Bayview's services even though it was known to be
"a shoddy operator."
However, John Boyle, a lawyer for the Quincy funeral home, told
AP that there is no evidence that it or other funeral homes did
anything wrong or knew about problems in handling remains at
Bayview.
In addition to Bayview and the Quincy funeral home, other
defendants named in Ms. Hunt's lawsuit include Bayview's owners,
seven other Massachusetts funeral homes and three organizations
that set industry standards on handling human remains.
As previously reported in the May 17, 2005 edition of the Class
Action Reporter, the Bayview Crematory has been the subject of
an investigation by New Hampshire since February 23, when state
troopers found the partially decomposed body of a woman in a
non-air-conditioned room at the Seabrook business. The troopers
also found the remains of two people in the crematorium's oven
and a trash bin located in the rear of the building overflowing
with medical waste. After these discoveries, the crematorium was
shut down and an investigation ensued, which has led to charges
against two assistant medical examiners alleging that they took
money from crematoriums without overseeing the process, as the
law requires.
As of the moment, most records concerning the crematorium's
operations remain in the hands of the Rockingham County
Attorney's office and are sealed pending the outcome of an
investigation.
Last month, investigators said they were examining remains of at
least 25 bodies that had been cremated at Bayview and were
confiscated when police raided two Massachusetts funeral homes.
Authorities said the documentation police found did not clearly
identify all the remains.
Attorneys for the Melville, N.Y., law firm that filed Hunt's
lawsuit, Lerach, Coughlin, Stoia, Geller, Rudman & Robbins, told
AP that it was the first case against Bayview filed in federal
court.
The complaints filed so far in state courts against Bayview and
other defendants include a lawsuit last month in Essex County
Superior Court by Paul Anzalone of Mansfield and 35 other
Massachusetts plaintiffs.
MERCURY INSURANCE: CA Court Grants Demurrer V. Consumer Lawsuit
---------------------------------------------------------------
The Orange County Superior Court in California granted Mercury
Insurance Company's demurrer against the class action filed
against it, styled "Kate Steinbeck vs. Mercury Insurance
Company, Mercury Casualty Company, and California Automobile
Insurance Company."
The plaintiff alleges that billing service fees charged in
connection with installment payments made by insureds constitute
premium and that Section 381 of the California Insurance Code
bars the charging of premium not specified in the policy. The
Complaint states claims for breach of contract, violations of
the California Unfair Competition Law, violation of the
California Consumer Legal Remedies Act, and common count claims
for unjust enrichment and money had and received under this
theory. The Complaint also seeks class action status,
unspecified damages and restitution, injunctive relief, and
unspecified attorneys' fees.
The Company filed a Demurrer to the Complaint seeking its
dismissal with prejudice for failure to state a claim and a
Motion to Strike Certain Allegations in the Complaint. On April
28, 2005, the Court ruled in favor of the Company, sustaining
its Demurrer with prejudice.
MERCURY INSURANCE: Asks CA Court To Dismiss Consumer Fraud Suit
---------------------------------------------------------------
Mercury Insurance Company asked the Los Angeles Superior Court
in California to dismiss the class action filed against it,
styled "Dan O'Dell, individually and on behalf of others
similarly situated v. Mercury Insurance Company."
The suit, filed July 12, 2002, involves a dispute over whether
the Company's use of certain automated database vendors to help
determine the value of total loss claims is proper. The
plaintiff (along with plaintiffs in other coordinated cases
against other insurers) is seeking class certification and
unspecified damages for breach of contract and bad faith,
including punitive damages, restitution, an injunction
preventing the Company from using valuation software and
unspecified attorneys' fees and costs.
In 2003, the court granted the Company's motion to stay the
action pending compliance with a contractual arbitration
provision. The arbitration was completed in August 2004 and the
court confirmed the award in the Company's favor in January
2005. Based upon the arbitration result and other defenses, the
Company has filed a pleading seeking dismissal, which is
expected to be heard in July 2005.
MERCURY INSURANCE: CA Court To Hear Summary Judgment in Lawsuit
---------------------------------------------------------------
The Los Angeles Superior Court in California will hear Mercury
Insurance Company's motion for summary judgment for the class
action filed against it, styled "Marissa Goodman, on her own
behalf and on behalf of all others similarly situated v. Mercury
Insurance Company."
The plaintiff is challenging the Company's use of certain
automated database vendors to assist in valuing claims for
medical payments. The plaintiff is seeking to have the case
certified as a class action. Plaintiff alleges that these
automated databases systematically undervalue medical payment
claims to the detriment of insureds. The plaintiff is seeking
unspecified actual and punitive damages.
The case has been coordinated with two other similar cases, and
also with ten other cases relating to total loss claims. The
Company and the other defendants were successful on demurrer.
The plaintiffs filed a Second Amended Complaint on June 28, 2004
which was substantially the same as the original complaint. The
Company has answered the Second Amended Complaint and filed a
Motion for Summary Judgment as to the claims of Ms. Goodman. The
Motion is scheduled for a June 2005 hearing.
MERRILL LYNCH: Plaintiffs Dismiss Securities Lawsuit in S.D. CA
---------------------------------------------------------------
Plaintiff voluntarily dismissed the class action filed against
Merrill Lynch & Co., Inc. in the United States District Court
for the Southern District of California on behalf of purchasers
of Variable Annuity Insurance Products between January 1, 1990
and January 21, 2005, without prejudice to its right to re-file.
The complaint alleges that during the Class Period, the Company
made false and misleading statements and omitted material facts
concerning its undisclosed financial interests with third party
suppliers of annuity contracts. The third parties paid monies
and other incentives to have Variable Annuities steered to them
by the Company without properly disclosing the preexisting
arrangement to its customers, an earlier Class Action Reporter
story (January 28,2005) reports.
A variable annuity is an insurance contract with characteristics
causing it to be treated as an "investment" under the Securities
Act of 1933. A Variable Annuity contract generally provides that
the purchaser agree to a simple "lump sum" premium or scheduled
fixed premiums for a pre-set number of years. The premiums are
deposited into a separate account after deducting expenses, fees
and charges specified in the contract. The premiums thus
collected in the annuitant's separate account are available for
tax deferred investment in one or more portfolios (called sub-
accounts). Upon maturity of the annuity, the annuitant receives
payment from the accumulated value in such amounts and upon the
terms specified in the underlying investment contract.
Rather than providing independent and unbiased services for
clients wanting to purchase Variable Annuities, Merrill Lynch
maintained secret contingent fee sharing agreements with a
number of insurance company underwriters of annuity contracts.
These activities cause insurance companies to collect higher
premiums than would be paid absent these arrangements and result
in Merrill Lynch customers paying inflated premiums for the
Variable Annuities.
Plaintiff seeks to recover damages on behalf of all purchasers
of Variable Annuities from Merrill Lynch during the Class
Period. Plaintiff is represented by the below firms. These law
firms, working on a contingent fee basis, have extensive
expertise in prosecuting investor class actions and substantial
experience with financial fraud.
For more details, contact Amy Lepine, Esq. of Finkelstein &
Krinsk, LLP by Phone: 877-493-5366 by Fax: 619-238-5425 or by E-
mail: ajl@classactionlaw.com OR Ronald A. Marron, Esq. of the
Law Office of Ronald A. Marron, APLC by Phone: 619-685-6969 by
Fax: 619-690-0983 or by E-mail Ron.Marron@cox.net OR Frederick
Schenk, Esq. of Casey, Gerry, Reed & Schenk by Phone:
619-238-1811 by Fax: 619-544-9232 or by E-mail:
fschenk@cglaw.com and Stephen Basser, Esq. of Barrack, Rodos &
Bacine by Phone: 619-230-0800 by Fax: 619-230-1874 or E-mail:
sbasser@barrack.com.
PENNSYLVANIA: University Offers To Settle Suit V. Ticket Policy
---------------------------------------------------------------
In a bid to settle a class action lawsuit challenging the
school's new basketball season ticket policy, the University of
Pittsburgh proposed allowing some season ticket holders to keep
their seats if they boost their donations to the school, The
Associated Press reports.
As previously reported in the March 31, 2005 edition of the
Class Action Reporter, attorney John Stember filed a class
action lawsuit challenging university's new basketball season
ticket policy, which lets the school reassign some seats
depending on how much a ticket holder donates to the school.
According to the attorney, who is a season ticket holder, "Many
hardworking people, who have been loyal supporters of Pitt for
decades could lose their seats or have their seats changed every
year under this new plan." He also said that before the Petersen
Events Center opened in 2002, the university promoted a plan
that promised season ticket holders the same seats every year,
if they maintained or increased their contributions to a
fundraising program then known as "Team Pittsburgh" and now
called "The Panther Club."
Additionally, Mr. Stember stated Pitt had announced previously
that all non-Club season tickets will be reassigned annually
based on a point score which includes, among other things, how
much money ticket holders give to a new sports fundraising
drive. The plaintiffs are comparing that process to a silent
auction, saying that people could lose their seats to others who
gave more money.
Mr. Stember is suing on behalf of 500 to 1,000 people who bought
tickets in a general seating area that will likely be affected
by the new policy. "They advertised this as a once-in-a-lifetime
opportunity to get your seats assigned," Mr. Stember said of the
2002 policy, which he wants the court to enforce. "I guess a
lifetime passes quickly," he adds.
Court documents revealed that Mr. Stember is asking an Allegheny
County judge to order the school to let current season ticket
holders keep their seats, which are be reassigned in May,
regardless of their donations.
The school's proposed settlement is similar to the remedy Mr.
Stember sought from the Allegheny County judge. Under the
proposal, current season ticket holders who have maintained or
upped their donations would be able to keep their seats through
the 2009-2010 season by making additional contributions.
Originally, the university had implemented the new program as
part of a $45 million campaign to fund more athletic
scholarships and build better facilities for some secondary
sports. "Our student-athletes' needs are at the heart of these
efforts to encourage broader financial support," said Pitt
athletic director Jeff Long.
PERINI CORPORATION: Suit Settlement Hearing Set August 8, 2005
--------------------------------------------------------------
The United States District Court for the District of
Massachusetts will hold a fairness hearing in the matter:
Doppelt, et al. v. Tutor, et al., Case No. 02 CV. 12010 (MLW) on
behalf of all persons or entities who hold Perini Corporation's
$2.125 depository convertible exchangeable preferred shares,
representing 1/10 share of $2.125 convertible exchangeable
preferred stock ("senior depository preferred stock).
The Hearing will be held on August 8, 2005, at 3:00 p.m., before
the Honorable Mark L. Wolf, United States District Court Judge,
at the John Joseph Moakley United States Courthouse, Boston,
Massachusetts, Courtroom 10.
For more details, contact Alan M. Pollack, Esq. or Felecia S.
Ennis, Esq. of Robinson Brog Leinward Greene Genovese & Gluck
P.C. by Mail: 1345 Ave. of the Americas, New York, NY 10105 or
by Phone: (212) 603-6300 OR Court-approved Information Agent by
Phone: (877) 278-9672.
PERINI CORPORATION: MA Settlement Fairness Hearing Set Aug. 2005
----------------------------------------------------------------
Fairness hearing for the settlement of the class action filed
against certain current and former directors of Perini
Corporation is set for August 8,2005 in the United States
District Court of Massachusetts.
On October 15, 2002, Frederick Doppelt, Arthur I. Caplan and
Leland D. Zulch filed a lawsuit individually, and as
representatives of a class of holders of the $2.125 Depositary
Convertible Exchangeable Preferred Shares, representing 1/10
Share of $21.25 Convertible Exchangeable Preferred Stock
("Depositary Shares") against certain current and former
directors of Perini. This lawsuit is captioned "Doppelt, et al.
v. Tutor, et al.," and is pending before the United States
District Court for the District of Massachusetts. Mr. Doppelt is
a current director of Perini and Mr. Caplan is a former director
of Perini.
Specifically, the original complaint alleged that the defendants
breached their fiduciary duties owed to the holders of the
Depositary Shares and to the Company. The plaintiffs principally
allege that the defendants improperly authorized the exchange of
Series B Preferred Stock for common stock while simultaneously
refusing to pay accrued dividends due on the Depositary Shares.
In July 2003, the plaintiffs filed an amended complaint. The
amended complaint added an allegation that the defendants have
further breached their fiduciary duties by authorizing a tender
offer for the purchase of up to 90% of the Depositary Shares and
an allegation that the collective actions of the defendants
constitute unfair and deceptive business practices under the
provisions of the Massachusetts Consumer Protection Act. The
amended complaint withdrew the allegation of a breach of
fiduciary duty owed to Perini, but retained the allegation with
respect to a breach of those duties owed to the holders of the
Depositary Shares.
On April 12, 2004, pursuant to Defendants' Motions to Dismiss,
the Court dismissed the claim under the Massachusetts Consumer
Protection Act. The Court did not dismiss the claim for breach
of fiduciary duty, except as such claim relates to the tender
offer for the purchase of the Company's Depositary Shares.
Pursuant to the Court's April 12, 2004 Order, in May 2004 the
plaintiffs filed a third amended complaint and a motion for
class certification. Defendants filed an answer denying any and
all claims of wrongdoing and asserting affirmative defenses.
On November 30, 2004, the Company announced that the parties had
reached an agreement for settlement of the Action. Under the
terms of the settlement, the Company would purchase all of the
Depositary Shares submitted in the settlement for consideration
per share of $19.00 in cash and one share of the Company's
common stock. The named plaintiffs have agreed to support the
settlement. On April 19, 2005, the District Court of
Massachusetts conditionally certified a class of holders of
Depositary Shares for purposes of settlement only. A hearing is
scheduled for August 8, 2005 to seek Court approval of the
settlement. The Court instructed that, starting on May 16,
2005, notice and a claim form should be sent to identifiable
holders of Depositary Shares.
As of March 31, 2005, there were 559,273 Depositary Shares
outstanding. In the event that fewer than 200,000 Depositary
Shares are submitted in the settlement, the Company may
terminate the settlement agreement and the parties will revert
to their previous positions in the litigation. The proposed
settlement remains subject to approval of the Court. Frederick
Doppelt will resign from his position as a director of Perini
upon Court approval of the settlement.
The suit is styled Doppelt, et al v. Tutor, et al., 1:02-cv-
12010-MLW, and is pending in the United States District Court
for the District of Massachusetts, under Judge Mark L. Wolf.
The law firms involved in this litigation are:
(1) Samuel E. Bonderoff of Paul, Weis, Rifkind, Wharton &
Garrison, NY, representing plaintiffs Leland D. Zulch,
Arthur I. Caplan and defendants Arthur J. Fox, Jr.,
Bonnie R. Cohn, Christopher H. Lee, Douglas J.
McCarron, Jane E. Newman, Marshall M. Crider, Nancy
Hawthorne, Peter Arkley, Raymond R. Oneglia, Richard J.
Boushka, Robert A. Band, Robert A. Kennedy, Ronald N.
Tutor and Wayne L. Berman;
(2) Robert T. Cronan of Goodwin Procter LLP Mail: Exchange
Place, 53 State Street, Boston, MA 02109, Phone: 617-
570-1389 or 617-523-1231, E-mail:
tcronan@goodwinproctor.com, representing defendants
Arthur J. Fox, Jr., Bonnie R. Cohn, Christopher H. Lee,
Douglas J. McCarron, Jane E. Newman, Marshall M.
Crider, Nancy Hawthorne, Peter Arkley, Raymond R.
Oneglia, Richard J. Boushka, Robert A. Band, Robert A.
Kennedy, Ronald N. Tutor and Wayne L. Berman and
plaintiff Arthur I. Caplan;
(3) Felicia S. Ennis of Robinson Brog Leinwand Greene
Genovese & Gluck, Mail: 31st Floor, 1345 Avenue of the
Americas New York, NY 10105-0143, Phone: 212-603-6300,
Fax: 212-956-2164 E-mail: fse@robinsonbrog.com
representing plaintiffs Frederick Doppelt and Arthur I.
Caplan and defendant Richard J. Boushka;
(4) Stuart M. Glass of Goodwin Procter, LLP, Mail: Exchange
Place, 53 State Street, Boston, MA 02109, Phone: 617-
570-1920, Fax: 617-523-1231, E-mail:
sglass@goodwinprocter.com, representing defendants
Arthur J. Fox, Jr., Bonnie R. Cohn, Christopher H. Lee,
Douglas J. McCarron, Jane E. Newman, Marshall M.
Crider, Nancy Hawthorne, Peter Arkley, Raymond R.
Oneglia, Richard J. Boushka, Robert A. Band, Robert A.
Kennedy, Ronald N. Tutor, Michael R. Klein and Wayne L.
Berman and plaintiff Arthur I. Caplan;
(5) Daniel J. Kramer of Paul Weiss Rivkind Wharton &
Garrison LLP, Mail: 1285 Avenue of the Americas, New
York, NY 10019 Phone: 212-373-300 Fax: 212-757-3990 E-
mail: dkramer@paulweiss.com, representing plaintiff
Arthur I. Caplan,
(6) Alan M. Pollack of Robinson Brog Leinwand Greene
Genovese & Gluck, Mail: 31st Floor, 1345 Avenue of the
Americas, New York, NY 10105-0143 Phone: 212-603-6316,
Fax: 212-956-2164 or E-mail: amp@robinsonbrog.com
representing plaintiff Frederick Doppelt and defendant
Richard J. Boushka;
(7) Steven L. Schreckinger of Palmer & Dodge, LLP, Mail:
111 Huntington Avenue, Boston, MA 02199, Phone: 617-
239-0167, Fax: 617-227-4420, E-mail:
sschreckinger@palmerdodge.com, representing plaintiffs
Arthur I. Caplan, Frederick Doppelt, Yvonne Weber,
Leland D. Zulch and defendants Richard J. Boushka, and
Martin Ahubik,
(8) Eryn Starun of Paul Weiss Rivkind Wharton & Garrison
LLP, Mail: 1285 Avenue of the Americas, New York, NY
10019, Phone: 212-373-300, Fax: 212-757-3990, E-mail:
estarun@paulweiss.com, representing plaintiff Arthur I.
Caplan
(9) Matthew J. Weiss of Weiss & Associates, 419 Park Avenue
South 2nd Floor New York, NY 10016, Phone: 212-683-7373
Fax: 212-726-0135 E-mail:
mjweiss@weissandassiciatespc.com representing
plaintiffs Arthur I. Caplan, Frederick Doppelt, Leland
D. Zulch, Martin Ahubik and Yvonne Weber
RADIOSHACK CORPORATION: Faces Overtime Wage Lawsuit in IL Court
---------------------------------------------------------------
RadioShack Corporation continues to face a class action filed in
the United States District Court for the Northern District of
Illinois, Eastern Division styled "Alphonse L. Perez, et al. v.
RadioShack Corporation, Case No. 02 C 7884."
On October 31, 2002, Alphonse L. Perez and Douglas G. Phillips
brought this lawsuit against the Company on behalf of themselves
and all other past and present employees of RadioShack who were
designated, paid, or employed as "Y" Store Managers in the
United States within the past three (3) years, and who have not
already had their claims for overtime previously adjudicated.
The suit alleges a claim under the Federal Fair Labor Standards
Act. This lawsuit alleges that RadioShack has and continues to
have a policy of requiring their employees in the "Y" Store
Manager position to work in excess of forty (40) hours per week
without paying them overtime compensation as required by federal
wage and hour laws. Plaintiffs seek to recover unpaid overtime
compensation, including the interest thereon, statutory
penalties, reasonable attorneys' fees and litigation costs on
behalf of themselves and all similarly situated current and
former "Y" Store Managers.
The suit is styled, "Perez et. al. v. RadioShack Corporation,
Case No. 02 C 7884," filed in the United States District Court
for the Northern District of Illinois, Eastern Division, under
Judge Rebecca R. Pallmeyer.
Counsel for the class are: Timothy J. Touhy, Esq., Daniel K.
Touhy, Esq., James B. Zouras, Esq., and Ryan F. Stephan, Esq.,
of TOUHY & TOUHY, LTD., 161 North Clark Street, Suite 2210,
Chicago, Illinois 60601.,Phone: (877)372-2209, Fax:
(312)456-3838, Email: lawyers@touhylaw.com Website:
http://www.radioshackclassaction.com,and Peter M. Callahan,
Esq., Robert W. Thompson, Esq. and Lee A. Sherman, Esq. of
CALLAHAN, McCUNE & WILLIS, 111 Fashion Lane, Tustin, California,
92780, Phone: (714) 730-5700, Fax: (714) 730-1642, E-mail:
classaction@cmwlaw.net.
Defendant Radioshack is represented by: Edward W. Bergmann,
Esq., Justin M. Crawford, Esq., Brian J. Hipp, Esq. of SEYFARTH
SHAW, 55 East Monroe Street, Suite 4200, Chicago, Illinois,
60603, Phone: (312) 346-8000, Fax: (312) 269-8869, and Robert S.
Brewer, Jr., Esq., Ross H. Hyslop, Esq., and Robert A. Cocchia,
Esq., of MCKENNA, LONG & ALDRIDGE, LLP, 750 B Street, Suite
3300, San Diego, California, 92101, Phone: (619)595-5400, Fax:
(619) 595-5450, E-mail: rsattorneys@mckennalong.com, Website:
http://www.radioshackovertimelawsuits.com.
RYLAND GROUP: Shareholders Launch Securities Lawsuit in C.D. CA
---------------------------------------------------------------
Ryland Group, Inc. and two of its officers face several
securities class actions filed on behalf of purchasers of the
Company's publicly traded securities during the period between
October 22, 2003 through January 7, 2004, inclusive.
The complaint, filed in the United States District Court for the
Central District of California, charges Ryland Group, R. Chad
Dreier, and Gordon Milne with violations of Sections 10(b) and
20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder. Between October 22, 2003 and January 7,
2004, the defendants issued a series of material
misrepresentations to the market concerning the Company's
financial results.
SEVILLE MARKETING: Inks Settlement For FTC Test Kits Complaint
--------------------------------------------------------------
Canadian operators who sold defective HIV test kits over the
Internet have settled Federal Trade Commission charges of making
deceptive advertising claims. The settlement bars the
defendants from selling the "Discreet" HIV test kits to U.S.
consumers unless the kit has been approved by the U.S. Food and
Drug Administration, and prohibits them from making false or
misleading claims about any medical diagnostic device or
service. The order also provides for notification to purchasers
of the Discreet kits and requires destruction of hundreds of the
defective kits seized by the U.S. Customs Service and Federal
Express.
In May 2004, the FTC filed a suit in U.S. district court against
Seville Marketing, Ltd., and its principal, Gregory Stephen
Wong, both of British Columbia, Canada. The agency alleged
Defendants Seville and Wong deceptively advertised that the
Discreet test results were 99.4 percent accurate. In fact,
testing conducted by the Centers for Disease Control and
Prevention and submitted to the court showed that 59.3 percent
of tested kits provided inaccurate results, including both
inaccurate HIV-positive results and inaccurate HIV-negative
results.
A stipulated final judgment and order, approved by the district
court judge on May 18, 2005, bars the defendants from
advertising or selling HIV test kits that the FDA has not
approved for sale in the U.S. It also prohibits the defendants
from making false or misleading statements about any device or
service marketed to assist in the diagnosis of any disease or
health condition. It authorizes the FTC to notify past Discreet
purchasers that the agency believes that the defendants
misrepresented the efficacy of the product, and advises
purchasers who relied on the kits to contact a health
professional. In addition, the settlement requires the
destruction of several hundred test kits previously seized by
U.S. Customs and Border Protection and Federal Express under a
temporary restraining order entered by the court in May 2004.
The final order contains standard record-keeping provisions to
allow the agency to monitor compliance.
The case was brought with the substantial assistance of the
Centers for Disease Control and Prevention, the U.S. Food and
Drug Administration, U.S. Customs and Border Protection, and the
British Columbia Business Practices and Consumer Protection
Authority. The case was filed in U.S. District Court for the
Western District of Washington at Seattle.
Copies of the complaint and stipulated judgment for permanent
injunction 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,
D.C. 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 information, contact Claudia Bourne Farrell,
Office of Public Affairs, by Phone: 202-326-2181 or Janet M.
Evans, Bureau of Consumer Protection by Phone: 202-326-2125 or
Nadine Samter, FTC Northwest Region by Phone: 206-220-4479 or
visit the Website: http://www.ftc.gov/opa/2005/06/seville.htm.
SHERWIN-WILLIAMS: Lead Paint Litigation Trial Set For Sept. 2005
----------------------------------------------------------------
Trial in the litigation filed against Sherwin-Williams Co. by
the State of Rhode Island over its lead pigments and lead-based
paints is set for April 2005.
The Company's past operations included the manufacture and sale
of lead pigments and lead-based paints. The Company, along with
other companies, is a defendant in a number of legal
proceedings, including purported class actions, separate actions
brought by the State of Rhode Island, and actions brought by
various counties, cities, school districts and other government-
related entities, arising from the manufacture and sale of lead
pigments and lead-based paints.
The plaintiffs are seeking recovery based upon various legal
theories, including negligence, strict liability, breach of
warranty, negligent misrepresentations and omissions, fraudulent
misrepresentations and omissions, concert of action, civil
conspiracy, violations of unfair trade practices and consumer
protection laws, enterprise liability, market share liability,
nuisance, unjust enrichment and other theories. The plaintiffs
seek various damages and relief, including personal injury and
property damage, costs relating to the detection and abatement
of lead-based paint from buildings, costs associated with a
public education campaign, medical monitoring costs and others.
The Company believes that the litigation is without merit and is
vigorously defending such litigation. The Company expects that
additional lead pigment and lead-based paint litigation may be
filed against the Company in the future asserting similar or
different legal theories and seeking similar or different types
of damages and relief, the Company stated in a disclosure to the
Securities and Exchange Commission.
During September 2002, a jury trial commenced in the first phase
of the action brought by the State of Rhode Island against the
Company and the other defendants. The sole issue before the
court in this first phase was whether lead pigment in paint
constitutes a public nuisance under Rhode Island law. This
first phase did not consider the issues of liability or damages,
if any, related to the public nuisance claim. In October 2002,
the court declared a mistrial as the jury, which was split four
to two in favor of the defendants, was unable to reach a
unanimous decision. This was the first legal proceeding against
the Company to go to trial relating to the Company's lead
pigment and lead-based paint litigation. The State of Rhode
Island has decided to retry the case and has requested that the
new trial consider all issues, including liability and damages.
A trial has been tentatively scheduled for September 2005.
The suit, filed by then Attorney General Sheldon Whitehouse (D)
in 1999, was the first suit filed by a state against the lead
paint industry. According to the state's complaint, the
defendants marketed and sold lead-based paint until it was
banned in 1978, despite the knowledge that it was toxic.
The companies named in the suit include:
(1) American Cyanamid Co.
(2) Atlantic Richfield
(3) ConAgra Grocery Products Co.
(4) Cytec Industries Inc.
(5) DuPont Co.
(6) Millennium Inorganic Chemicals Inc.
(7) NL Industries Inc. and
(8) Sherwin-Williams Co.
The suit, styled "State of Rhode Island v. Lead Industries
Association, Inc., et al., Case No. 99-5226," is filed in the
Superior Court for the State of Rhode Island, under Judge
Michael Silverstein.
The suit was filed by RI Attorney General Sheldon Whitehouse,
150 South Main Street, Providence, RI 02903. Counsel for the
plaintiffs are Leonard Decof, Decof & Grimm, One Smith Hill,
Providence, RI 02903 and John J. McConnell Jr. of Ness, Motley,
Loadhold, Richardson & Poole, 321 South Main Street, P.O. Box
6067, Providence, RI 02940.
Counsel for the Company are Shelia High King of Cetrulo &
Capone, The Heritage Building, 321 South Main Street,
Providence, RI 02903; Lawrence G. Cetrulo and Nancy Kelly of
Cetrulo & Capone, Exchange Place, 53 State Street, Boston, MA
02109; and Paul Michael Pohl, Charles H. Moellenberg Jr., Laura
E. Ellsworth of Jones, Day, Reavis & Pogue, 500 Grant Street,
31st Floor, Pittsburgh, PA 15219.
SKYLINE CORPORATION: Recalls 213 Trailers For Incorrect Labels
--------------------------------------------------------------
Skyline Corporation in cooperation with the National Highway
Traffic Safety Administration's Office of Defects Investigation
(ODI) is voluntarily recalling about 213 units of 2005-06
Skyline Layton Limited/Nomad Limited Trailers.
According to the ODI, on certain travel trailers, the
certification label has incorrect information. The wrong tire
brand, tire size and cold inflation pressure are shown. Under-
inflation of the tires can lead to rapid tire wear and premature
failure that could result in a loss of control of the vehicle,
increasing the risk of a crash.
As a remedy dealers will send replacement labels along with
instructions.
For more details, contact Skyline by Phone: 1-800-736-2573 or
the NHTSA Auto Safety Hotline: 1-888-327-4236.
SKYWEST AIRLINES: Parties Fail To Reach Settlement For CA Suit
--------------------------------------------------------------
The overtime class action filed against SkyWest Airlines, Inc.
in the Superior Court of Santa Barbara, California remains
unresolved as mediation between the parties was unsuccessful.
Two former employees filed the suit, styled "Michaelena Fitz-
Gerald, Romead Neilson, et al., v. SkyWest Airlines, Inc.,"
alleging unpaid minimum wages, meal and rest break penalties,
and overtime, as well as violations of California Labor Code
SS203 and Business and California Professions Code SS17000, et
seq. In addition to their own claims, the plaintiffs have pled
the case as a class action on behalf of all current and former
SkyWest flight attendants based in California since July 1999
but had not obtained class certification as of May 6, 2005. The
plaintiffs are seeking monetary damages as compensation for
their grievances.
SUPERCONDUCTOR TECHNOLOGIES: Reaches Settlement For CA Lawsuits
---------------------------------------------------------------
Superconductor Technologies, Inc. reached a settlement for the
consolidated securities class action filed against it and
certain of its officers in the United States District Court for
the Central District of California.
Plaintiffs filed an amended consolidated complaint in October
2004. The plaintiffs allege securities law violations by the
Company and certain of its officers and directors under Rule
10b-5 and Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934, as amended. The complaint was filed on behalf of a
purported class of people who purchased Company stock during the
period between January 9, 2004 and March 1, 2004 and seeks
unspecified damages. The plaintiffs base their allegations
primarily on the fact that the Company did not achieve its
forecasted revenue guidance of $10 to $13 million for the first
quarter of 2004.
In February 2005 the Company settled with the lead plaintiffs
appointed by the Court to handle this matter. Under the terms of
the settlement, the Company's insurers will pay $4.0 million
into a settlement fund, and the Company will pay up to $50,000
of the costs of providing notice of the settlement to settlement
class members. The settlement remains subject to approval by
the District Court.
The suits are pending in the United States District Court for
the Central District of California, under Judge Dickran
Tevrizian. The suits are styled:
(1) Marc A Backhaus v. Superconductor Technologies Inc et
al., 2:04-cv-02680-DT-JTL,
(2) Sandy Goldfine v. Superconductor Technologies Inc et
al., 2:04-cv-02848-DT-JTL
(3) Aida Alvarez v. Superconductor Technologies Inc et al.,
2:04-cv-02927-DT-JTL
Lawyer for the Company is Richard H. Zelichov, Irell & Manella,
1800 Avenue of the Stars, Ste 900, Los Angeles, CA 90067-4276,
Phone: 310-277-1010, E-mail: rzelichov@irell.com. Lawyers for
the plaintiffs are:
(i) Arthur R. Angel, Arthur R Angel Law Offices, 1236 North
Fairfax Avenue, West Hollywood, CA 90046, Phone: 323-
656-9085
(ii) Stuart W Emmons and William B Federman, Federman and
Sherwood, 120 North Robinson, Suite 2720, Oklahoma
City, OK 73102, Phone: 405-235-1560, E-mail:
wfederman@aol.com
(iii) Christopher Kim, Liza J. Yang, Lim Ruger & Kim, 1055 W
7th St, Ste 2800, Los Angeles, CA 90017, Phone: 213-
955-9500, E-mail: ckim@lrklawyers.com or
lisayang@lrklawyers.com
(iv) Richard A Maniskas, Marc A. Topaz, Schiffrin & Barroway
3 Bala Plaza E Ste 400, Bala Cynwyd, PA 19004, Phone:
610-667-7706
(v) Peter A Binkow, Lionel Z. Glancy, Michael Goldberg,
Glancy & Binkow 1801 Avenue of the Stars, Ste 311, Los
Angeles, CA 90067, Phone: 310-201-9150, E-mail:
info@glancylaw.com
(vi) Robert I Harwood, Wechsler & Harwood, 488 Madison Ave,
8th Floor, New York, NY 10022, Phone: 212-935-7400
TECUMSEH PRODUCTS: Consumers Launch Fraud Suits Over Lawnmowers
---------------------------------------------------------------
Tecumseh Products, Inc. faces a class action, alleging that the
horsepower labels on the products the plaintiffs purchased were
inaccurate. The plaintiffs seek certification of a class of all
persons in the United States who, beginning January 1, 1995
through the present, purchased a lawnmower containing a two
stroke or four stroke gas combustible engine up to 20 horsepower
that was manufactured by defendants. The complaint seeks an
injunction, compensatory and punitive damages, and attorneys'
fees.
No orders have been entered in the case, and there has been
limited discovery. The Company denies the allegations and will
fight this case, according to a disclosure to the Securities and
Exchange Commission.
TEXTRON FINANCIAL: Faces OH Suit Over Buyers' Source Financing
--------------------------------------------------------------
Textron Financial Corporation faces a class action filed in the
Court of Common Pleas for Knox County, Ohio relating to the
financing of certain land purchases by consumers through a third
party land developer commonly known as "buyer's source."
In March 2003, the United States Department of Justice (DOJ)
authorized the filing of a civil action against Textron
Financial and its subsidiary, Litchfield Financial Corporation
(Litchfield), and other third parties, arising from the "Buyer's
Source." In the fourth quarter of 2003, the Company executed a
settlement agreement with DOJ, which required the Company to
offer affected consumers various options, ranging from cash
payments to forgiveness of debt in exchange for return of the
property. The Florida Attorney General's office also opened a
preliminary investigation into Litchfield's activities relative
to Buyer's Source and, while the Company believes it has good
defenses to any potential claims by the State of Florida, it is
engaged in settlement discussions with Florida.
The suit was commenced against the Company and Litchfield,
certain of their current and former officers, and other third-
parties, related to the Buyer's Source matter. Among other
claims, the purported class action alleges fraud in the
financing of the third-party land developers and seeks
compensatory damages and punitive damages in excess of $10
million.
TROPICANA PRODUCTS: Settles FTC Lawsuit for Misleading Juice Ads
----------------------------------------------------------------
The Federal Trade Commission has settled a complaint against
Tropicana Products, Inc., in which it alleged the company misled
consumers with claims that drinking two to three glasses a day
of its "Healthy Heart" orange juice would produce dramatic
effects on blood pressure, cholesterol, and homocysteine levels,
thereby reducing the risk of heart disease and stroke.
Under the terms of the consent agreement settling the charges,
Tropicana is prohibited from making similar health-related
claims in the future unless they can be substantiated by
reliable scientific evidence.
According to the Commission, Tropicana ran the "Healthy Heart"
ads between 2002 and early 2004, on television and in
publications such as Newsweek magazine. The ads claimed that
drinking two to three cups of Tropicana orange juice each day
would lower systolic blood pressure by 10 points, raise HDL
cholesterol by 21 percent and improve the HDL to LDL cholesterol
ratio by 16 percent, increase blood folate levels by 45 percent
and lower blood homocysteine levels by 11 percent. The complaint
charges that the benefits were not substantiated and claims of
clinical support for them were false.
"Orange juice contains many nutrients important to a healthy
diet, and advertising can be an important source of information
about the health benefits of foods," said Lydia Parnes, Director
of the Bureau of Consumer Protection. "But it is essential that
such advertising be truthful. In this case Tropicana's claims
went well beyond its scientific support."
According to the Commission, Tropicana ran the "Healthy Heart"
ad as a two-page spread in Newsweek magazine in February 2004.
In 2002, Tropicana ran a more extensive national advertising
campaign, including several television commercials and a full-
page print ad in the New York Times, as cited in the
Commission's complaint. The 2002 ad campaign made a claim
virtually identical to the 10-point blood pressure reduction
claim that appeared in the 2004 advertising. The Commission
staff had specifically expressed its concerns about the blood
pressure claim made in the earlier campaign in a public closing
letter in July 2002, but did not seek formal agency action at
that time. As the letter noted, although foods that are rich in
potassium and low in sodium such as orange juice have been
recognized by public health authorities, including the Food and
Drug Administration (FDA), to help reduce the risk of
hypertension and stroke, the 10-point blood pressure reduction
claim did not appear to be substantiated.
The Commission's complaint charges Tropicana with making
unsubstantiated claims that:
(1) drinking three cups of Tropicana orange juice a day for
four weeks will raise HDL cholesterol by 21 percent and
improve the ratio of HDL to LDL cholesterol by 16
percent;
(2) drinking 20 ounces of Tropicana orange juice a day will
increase blood levels of folate by almost 45 percent
and decrease homocysteine levels by 11 percent; and
(3) drinking two cups of Tropicana orange juice a day for
six or eight weeks will lower systolic blood pressure
an average of 10 points.
The complaint also charges that Tropicana's claims that clinical
studies demonstrated these benefits were false.
The consent order prohibits Tropicana from making the challenged
claims or any similar claims about the effects of orange juice
or other foods on blood pressure, cholesterol levels, folate
levels, and homocysteine levels or other biological markers or
health-related endpoints unless the company substantiates the
claim with competent and reliable scientific evidence. The order
also prohibits claims by Tropicana that any food will have an
effect on the risk of heart disease, stroke, or cancer unless
substantiated by competent and reliable scientific evidence. The
order also prohibits any misrepresentations relating to tests or
studies. Tropicana is permitted under the settlement to make
certain claims that comply with specific FDA regulations for
food labeling. Finally, the order contains various record
keeping requirements to assist the FTC in monitoring compliance.
Tropicana Products, Inc. is based in Chicago, Illinois, and is a
subsidiary of PepsiCo.
The Commission vote to issue the administrative complaint and
accept the consent agreement for public comment was 5-0. An
announcement regarding the consent agreement will be published
in the Federal Register shortly. The agreement will be subject
to public comment for 30 days, until July 1, 2005, after which
the Commission will decide whether to make it final. Comments
should be addressed to the FTC, Office of the Secretary, 600
Pennsylvania Avenue, N.W., Washington, DC 20580.
Copies of the administrative complaint and consent agreement 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 contact Michelle Rusk
or Karen Muoio, Bureau of Consumer Protection by Phone:
202-326-3148 or 202-326-2491 or visit the Website:
http://www.ftc.gov/opa/2005/06/tropicana.htm.
UNITED AMERICAN: Schatz & Nobel Files Investors' Suit in E.D. MI
----------------------------------------------------------------
United American Healthcare Corp.'s dealings with former state
Sen. John Ford through a TennCare managed care organization drew
a lawsuit that was filed by the Connecticut law firm Schatz &
Nobel on behalf of investors.
The suit, which is seeking class-action status, was filed in the
U.S. District Court for the Eastern District of Michigan on
behalf of anyone who bought the company's common stock (NASDAQ:
UAHC) between May 26, 2000 and April 22, 2004.
UAHC is the company behind UAHC Health Plan of Tennessee, a
TennCare MCO that was placed under administrative supervision by
the Tennessee Department of Commerce & Insurance in April due to
concerns about its dealings with Ford. The MCO covers about
130,000 TennCare enrollees in West Tennessee.
The suit alleges that officers and directors of UAHC violated
federal securities laws. Specifically, the lawsuit alleges the
company didn't disclose its "improper business and financial
relationship with a legislator having oversight" of the health
plan, and that the relationship with the legislator led to it
being placed under administrative supervision.
In an April order, Commerce & Insurance Commissioner Paula
Flowers expressed concern that federal and state investigations
of Ford's business dealings and lawsuits put the company at
financial risk.
However, Osbie Howard, former CEO of UAHC Health Plan of
Tennessee, which was formerly known as OmniCare, denied that the
company had any business relationships with Sen. Ford or Managed
Care Services Group or Managed Care Services Group I, companies
reportedly affiliated with the senator, according to the state.
On April 15, UAHC CEO William Brooks issued a statement saying
that the company had notified the Tennessee Department of
Finance & Administration about its relationship with Ford and
that it was terminated March 11.
The Commissioner Flowers' administrative supervision order also
notes that the Department of Commerce & Insurance believes
Briggette Green, a former vice president of the MCO, plans to
sue the company for wrongful termination after she found out it
was paying Sen. Ford $10,000 per month in consulting fees.
According to the Schatz & Nobel lawsuit, "investors could not
accurately assess the extent to which United American's ongoing
operations, reported revenue and income were dependent upon the
improper political payments scheme."
Last week, Sen. Ford and state Senators Ward Crutchfield (D-
Chattanooga,) Katherine Bowers (D-Memphis), and Rep. Chris
Newton (D-Cleveland) were arrested by the Federal Bureau of
Investigation on charges unrelated to TennCare as part of an
undercover sting operation. Also arrested in connection with the
sting were former Sen. Roscoe Dixon, Chattanooga lobbyist
Charles Love and Memphis activist Barry Myers. The charges
specifically focus on a bill governing the distribution of
excess property, a bill co-sponsored by the four current
legislators and Sen. Dixon. Sen. Ford resigned from his Senate
seat on Saturday.
USF CORPORATION: Red Star Employees Launch WARN Suits in PA, NY
---------------------------------------------------------------
USF Corporation faces several class actions filed in
Pennsylvania and New York federal courts, alleging violations of
the federal Worker Adjustment and Retraining Notification Act
(WARN).
On November 19, 2004, the Teamsters National Freight Industry
Negotiating Committee (TNFINC) filed a complaint against the
Company, USF Red Star Inc. and USF Holland Inc. in the United
States District Court for the Eastern District of Pennsylvania.
On January 13, 2005, service of process was effectuated on all
three USF defendants. TNFINC alleges certain violations of the
National Labor Relations Act and asks for damages.
Additionally, TNFINC filed a class action suit on behalf of the
employees of USF Red Star alleging violations of the WARN Act.
The Company and/or USF Red Star, Inc. are currently named in
five class action lawsuits alleging violations of the federal
WARN Act. Three WARN class actions are pending in the United
States District Court for the Eastern District of Pennsylvania
and one each is pending in the United States District Court for
the District of Connecticut and the United States District Court
for the Western District of New York. The WARN action in the
Western District of New York was filed in late January 2005 by
former mechanics of USF Red Star's Buffalo, New York terminal.
On September 30, 2004 USF Red Star filed a motion to transfer
and consolidate the three original WARN actions with the
Judicial Panel for Multidistrict Litigation (JPMDL), requesting
that all three cases be consolidated and transferred to the
United States District Court for Northern District of New York
where USF Red Star's former headquarters are located in Auburn,
New York. On February 16, 2005, the JPMDL transferred three of
the five WARN cases to the United States District Court for the
Eastern District of Pennsylvania.
VASO ACTIVE: Enters MOU To Settle Pending Consolidated Lawsuits
---------------------------------------------------------------
Vaso Active Pharmaceuticals, Inc. (Vaso Active) (VAPH.pk) of
Danvers, Massachusetts entered into a Memorandum of
Understanding Concerning Settlement Terms (MOU) to settle the
pending consolidated securities class action lawsuit. Under the
terms of the MOU, the lead plaintiffs and the settling
defendants agree that the final stipulation will contain a
disclaimer of liability consistent with the MOU.
Subject to the terms and conditions set forth in the MOU,
settling defendants will pay into escrow for the benefit of the
class $1,100,000 in cash and $750,000 face amount of 2-year 5%
subordinated callable notes convertible at $1.75 per share
within 10 business days of preliminary approval of the
settlement by the court. In consideration of this payment, the
parties will fully and finally release and discharge all claims
against each other. The settlement still needs court approval.
The Company's insurance carrier has agreed to pay the $1,100,000
cash payment in exchange for a release of its liability under
its insurance policy with the Company.
"This is a significant positive step forward for the Company. We
look forward to putting this obstacle behind us, allowing us to
now concentrate our efforts on building value for our
shareholders," said Joseph Frattaroli, President of Vaso Active.
VEGAS GRAND: NV Suit Expanded, Additional Firms Join Legal Team
---------------------------------------------------------------
A class action lawsuit filed on behalf of hundreds of Vegas
Grand condominium purchasers was expanded by the filing of a
First Amended Complaint, adding new legal theories to the case
against developers of the Las Vegas property.
The suit was filed after the developers unilaterally cancelled
the purchasers' agreements in a letter April 25, 2005. Six
additional class representatives were named in the amended
complaint.
In a related matter, court papers were filed to add three
additional law firms to the team of lawyers representing the
purchasers. Marquis & Aurbach, a well-known Las Vegas law firm,
associated into the case as counsel for the purchasers. Two
additional California law firms, Donahoo & Associates and Foley
& Bezek, LLP also filed court papers seeking to associate into
the class action as additional counsel on behalf of the
purchasers.
"We are pleased to welcome the additional law firms, who bring
strong resources to the team representing the purchasers," said
Las Vegas attorney George O. West III, who filed the original
class action complaint on May 19, 2005. Many California
residents were purchasers at Vegas Grand.
The new claims for relief seek to rescind any purported
agreements resulting from purchasers signing a "Deposit Option
Form" that was included with the cancellation letter April 25,
2005. The Developer's April 25, 2005 letter offered purchasers
only two options- to sign a new reservation agreement at almost
double the original price, or to receive their deposit money
back with a 5% "bonus."
"Many of the purchasers signed the form because there were no
other options presented and the developer did not promise in the
letter to refund their deposits without the Deposit Option Form
being signed. The purchasers were presented only two options,
sign up at a new price, or sign to obtain their money back,"
said attorney Craig Anderson of Marquis & Aurbach.
Many purchasers report receiving checks from the Nevada Title
Company purporting to refund their reservation deposits since
the filing of the class action lawsuit. "We advise purchasers
not to cash or deposit the refund checks, without first seeking
legal advice," said Mr. Anderson.
A website at http://www.vegascondolawsuit.comhas been
established to provide news and information to Vegas Grand
purchasers.
The class action lawsuit seeks damages under several theories
including breach of the original agreement and for deceptive
trade practices. Any individuals who entered into agreements
with Vegas Grand are advised to seek legal advice before taking
any steps that could impair their rights, including cashing
refund checks.
For more details, contact Craig Anderson of Marquis & Aurbach by
Mail: 10001 Park Run Drive, Las Vegas, Nevada 89145 by Phone:
702-382-0711 by Fax: 702-382-5816 OR George O. West III of the
Law Offices of George O. West III by Mail: 6787 West Tropicana
Avenue, Suite 263, Las Vegas, Nevada 89103 by Phone:
702-248-1076 or by Fax: 702-288-6710 OR Richard E. Donahoo of
Donahoo & Associates by Mail: 505 N. Tustin Ave., Suite 160,
Santa Ana, California 92705 by Phone: 714-953-1010 or by Fax:
714-953-1777 OR Thomas G. Foley of Foley & Bezek, LLP by Mail:
15 W. Carrillo Street, Santa Barbara, California by Phone:
805-962-9495 or by Fax: 805-962-0722 Facsimile or visit their
Web site to view the complaint:
http://www.vegascondolawsuit.com/pdfs/Complaint.pdf.
VIRBAC CORPORATION: Asks TX Court To Dismiss Securities Lawsuit
---------------------------------------------------------------
Virbac Corporation asked the United States District Court for
the Northern District of Texas, Fort Worth Division to dismiss
the consolidated securities class action filed against it and
certain of its officers and directors.
On December 15, 2003, Martine Williams, a Company stockholder,
filed a putative securities class action lawsuit against the
Company and:
(1) Virbac S.A. (VBSA),
(2) Thomas L. Bell (the Company's former President, Chief
Executive Officer and member of the Company's Board of
Directors),
(3) Joseph A. Rougraff (the Company's former Vice
President, Chief Financial Officer and Secretary), and
(4) Pascal Boissy (the Chairman of the Board of Directors)
The complaint asserted claims against the Company and the
individual defendants based on securities fraud under Section
10(b) of the Securities Exchange Act of 1934, as amended and
Rule 10b-5 of the Exchange Act and claims against VBSA and the
individual defendants based on "control person" liability under
Section 20(a) of the Exchange Act.
On May 19, 2004, the "Williams v. Virbac et al." lawsuit was
consolidated with a separate lawsuit filed by John Otley, which
contained virtually identical allegations to those claimed by
Martine Williams, and the court appointed lead counsel for the
plaintiffs. On September 10, 2004, plaintiffs filed a
consolidated amended class action complaint, asserting claims
against the Company and the individual defendants based on
securities fraud under Section 10(b) under the Exchange Act and
Rule 10b-5, and asserting claims against VBSA and the individual
defendants for violation of Section 20(a) of the Exchange Act as
alleged "control persons" of the Company.
Plaintiffs generally allege in the Amended Complaint that the
defendants caused the Company to recognize and record revenue
that it had not earned; that the Company thereupon issued
financial statements, press releases and other public statements
that were false and materially misleading; that these false and
misleading statements operated as a "fraud on the market,"
inflating the price of the Company's publicly traded stock; and
that when accurate information about the Company's actual
revenue and earnings emerged, the price of the Company's Common
Stock sharply declined, allegedly damaging plaintiffs.
Plaintiffs seek to recover monetary compensation for all damages
sustained as a result of the defendants' alleged wrongdoing, in
an amount to be determined at trial (including pre-judgment and
post-judgment interest thereon), costs and expenses incurred in
connection with the lawsuit (including attorneys' fees and
expert witnesses' fees), and such other and further relief as
the court may deem just and proper.
The Company filed a motion to dismiss the Amended Complaint on
December 10, 2004, as did defendants Bell and Rougraff.
Defendants VBSA and Boissy filed a joint motion to dismiss on
December 14, 2004. On February 11, 2005, plaintiffs filed a
consolidated opposition against all defendants' motions to
dismiss. On March 11, 2005, the Company, Mr. Bell, and Mr.
Rougraff each filed separate replies to plaintiffs' consolidated
opposition. Defendants VBSA and Boissy filed a joint reply on
March 11, 2005.
WASHINGTON: Court Ruling Over WTO Protests Partially Favors City
----------------------------------------------------------------
A federal appeals court panel ruled that the city had a right to
block off part of downtown Seattle when World Trade Organization
protests turned violent in 1999, The Associated Press reports.
However, the judges pointed out that the city might have gone
too far in targeting only anti-WTO protesters within the
restricted zone.
The ruling, which partially overturned a 2001 decision by U.S.
District Judge Barbara Rothstein, gives some demonstrators the
green light to pursue a class action claim that the city
violated their constitutional rights.
Court documents revealed that in November 1999, some 50,000
people swarmed downtown Seattle in protest of a WTO meeting. A
relatively small number of protesters smashed storefronts and
overwhelmed police, who responded with tear gas and mass
arrests. Damage totaled about $2.5 million.
The city's response to the riot was to impose a curfew and
declare a "no protest" zone around the downtown core. Only WTO
delegates or staff, downtown workers and shoppers were allowed
into the zone.
Some people were arrested for protesting in the zone, while
others were barred from entering the restricted zone even if
they were on their way to work or shop, because they were
wearing "No WTO" stickers or signs.
Subsequently, several protesters sued in federal court, arguing
that the city had no right to suppress lawful speech in response
to the actions of a few bad apples.
However Judge Rothstein threw out their claims, saying the city
had imposed a proper "time, place or manner" restriction to
ensure public safety.
The panel of the 9th U.S. Circuit Court of Appeals agreed 2-1
that the city did have a right to create the "no-protest" zone.
All three judges pointed out, however in the 109-page opinion,
that the way the zone was enforced, by arresting anti-WTO
protesters alone, raised serious questions about discrimination.
As previously reported in the November 6, 2001 edition of the
Class Action Reporter, the suit was brought by Steve Berman, the
attorney working on behalf of the Trial Lawyers for Public
Justice (TLPJ), who filed the suit on behalf of the protesters.
The Trial Lawyers for Public Justice filed the original suit in
October 2, 2000. It claims that the city and police department
violated the First Amendment and other provisions of the United
States and Washington State Constitutions. The complaint, thus
seeks damages from the city, Mayor Paul Schell, and former
Police Chief Norman Stamper on behalf of more than 600
protesters and others arrested and imprisoned on December 1 and
2, 1999, pursuant to the city's "no-protest zone" policy.
WHIRLPOOL CORPORATION: Recalls 529T Coffeemakers For Fire Hazard
----------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Whirlpool Corp., of Benton Harbor, Michigan is
voluntarily recalling about 529,000 KitchenAidr Coffeemakers.
An internal electrical component of the coffeemaker can overheat
and ignite, posing a fire hazard to consumers. Whirlpool Corp.
has received 13 reports of incidents involving coffeemakers
overheating resulting in minor property damage. No injuries have
been reported.
The recalled KitchenAidr coffeemakers are black, white, red, or
blue in color. They are manufactured in 10- and 12-cup models.
Consumers can determine if they have one of the recalled
coffeemakers by identifying the product's model and serial
numbers, which are located on a label on the bottom of the
coffeemaker. The affected models include:
10 - cup models
KCM120OB
KCM300OB
KCM120WH
KCM300WH
12 - cup models
KCM200OB
KCM400OB
KCM200WH
KCM400WH
KCM400ER
KCM400BU
The serial numbers of the affected products begin with the
letters WCJ, WCK, WCL, WCM, and WCP.
Manufactured in China, the coffeemakers were sold at all
catalogs, department stores, specialty retailers and on-line
retailers nationwide from January 1999 through December 2004 for
between $50 and $130.
Consumers should unplug and stop using the coffeemakers
immediately and contact KitchenAidr for a free comparable
coffeemaker model or an exchange for another KitchenAidr
product. Consumers should not return the coffeemaker to the
retailer where it was purchased.
Consumer Contact: Contact KitchenAidr at (800) 990-6255 between
8 a.m. and 8 p.m. ET Monday through Friday, and between 10 a.m.
and 5 p.m. ET on Saturday, or go to the firm's Web site at
http://www.KitchenAid.com/repair.
XL CAPITAL: Asks CT Court To Dismiss Securities Fraud Lawsuit
-------------------------------------------------------------
XL Capital Ltd. asked the United States District Court for the
District of Connecticut to dismiss the consolidated securities
class action filed against it and certain of its present and
former directors and officers, styled "Malin et al. v. XL
Capital Ltd et al."
The suit purports to be on behalf of purchasers of the Company's
common stock between November 1, 2001 and October 16, 2003, and
alleges claims under Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The
Amended Complaint alleges that the defendants violated the
Securities Laws by, among other things, failing to disclose in
various public and shareholder and investor reports and other
communications the alleged inadequacy of the Company's loss
reserves for its NAC Re subsidiary (now known as XL Reinsurance
America, Inc.) and that, as a consequence, the Company's
earnings and assets were materially overstated.
Defendants filed a motion to dismiss the Amended Complaint which
motion is pending before the Court. There has been no discovery
in the Malin Action.
XPEDITE: Seeks Partial Dismissal of MD TCPA Violations Lawsuit
--------------------------------------------------------------
Xpedite, a subsidiary of Premier Global Services, Inc., asked
the United States District Court for the District of Maryland to
partially dismiss the class action filed against it, alleging
violations of the Telephone Consumer Protection Act (TCPA).
On February 22, 2005, Paul Worsham filed a purported class
action in the Circuit Court for Montgomery County, Maryland,
alleging that the Company transmitted pre-recorded telephone
calls advertising Data Communications services to telephone
numbers in Maryland, including to Mr. Worsham's telephone
number, in violation of the federal TCPA and applicable FCC
rules. The complaint also alleges violations of federal caller
identification requirements under FCC rules and violations of
the Maryland Telephone Consumer Protection Act. The complaint
seeks statutory damages under the federal and Maryland statutes
for each violation and injunctive relief.
On April 4, 2005, the Company filed a notice of removal of this
case to federal court. On April 11, 2005, the Company filed its
answer and counterclaim and a partial motion to dismiss. On
April 20, 2005, the Company filed a motion to consolidate this
case with a separate state action filed by the plaintiff against
the Company and two other defendants alleging violations of the
same statutes as those at issue in the purported class action.
Also, on April 20, 2005, plaintiff filed a motion to remand the
case back to state court. These motions are pending. The court
has scheduled a hearing on the partial motion to dismiss for
July 18, 2005.
ZOMAX INC.: Securities Settlement Hearing Set September 6, 2005
---------------------------------------------------------------
The United States District Court for the District of Minnesota
will hold a fairness hearing for the proposed $2.25 million
settlement in the matter: In re Zomax, Inc. Securities
Litigation, Civil Action No. 04-1155 (DWF/SRN) on behalf of all
persons who purchased or otherwise acquired shares of the firm's
common stock between May 25, 200 through October 18, 2002.
The hearing shall be held on September 6, 2005, at 1:30 p.m. in
the United States District Court for the District of Minnesota,
700 Federal St., 316 N. Robert St., Saint Paul, MN 55101.
For more details, contact In re Zomax, Inc. Securities
Litigation c/o A.B. Data, Ltd., Claims Administrator by Mail:
P.O. Box 170200, Milwaukee, WI 53217-8016 OR Michael K. Yarnoff,
Esq. or Kay E. Sickles, Esq. of Schiffrin & Barroway, LLP by
Mail: 280 King of Prussia Road, Radnor, PA 19087 or by Phone:
(610) 667-7706.
New Securities Fraud Cases
CARRIER ACCESS: Lerach Coughlin Files Securities Lawsuit in CO
--------------------------------------------------------------
The law firm of Lerach Coughlin Stoia Geller Rudman & Robbins
LLP ("Lerach Coughlin") initiated a class action in the United
States District Court for the District of Colorado on behalf of
purchasers of Carrier Access Corporation ("Carrier Access")
(NASDAQ:CACSE) publicly traded securities during the period
between October 21, 2003 and May 20, 2005 (the "Class Period").
The complaint charges Carrier Access and certain of its officers
and directors with violations of the Securities Exchange Act of
1934. Carrier Access designs, manufactures and sells converged
access equipment to wireline and wireless carriers.
The complaint alleges that during the Class Period, defendants
made materially false and misleading statements regarding the
Company's financial results and its business prospects. As a
result of these false statements, the Company's shares traded at
inflated levels during the Class Period, allowing the defendants
to use the Company's shares as currency in its acquisition of
Paragon Networks and to sell 6 million shares to the public in a
secondary offering, raising proceeds of $78 million.
However, according to the complaint, by July 20, 2004, due to
the defendants' concerns about the government's stance towards
accounting fraud, the Company announced a reduction in the
Company's projections, sending its shares down 37%, a loss of
$4.73 to $8.06. On May 5, 2005, the Company issued a press
release in which it announced it had received a Nasdaq Staff
Determination letter which indicated that "although the company
filed its Form 10-K for the fiscal year ended December 31, 2004,
the filing did not include management's assessment of its
internal controls over financial reporting and the associated
auditor attestation report . . . ." As a result, the Company's
stock was subject to delisting on the Nasdaq Stock Market. Then
on May 20, 2005, the Company issued a press release stating that
it was in the process of performing a detailed review of all
significant customer relationships and as part of those reviews
was evaluating the propriety of the timing of revenue and cost
recognition and other revenue recognition issues. The release
stated: "At this point in time, the Company has determined that
certain revenues and direct costs have been recorded in
incorrect periods. The amounts that have been quantified to date
are significant and, as a result, previously issued financial
statements for the year ended December 31, 2004, and certain
interim periods in each of the years ended December 31, 2004,
and 2003, will be restated." On this news the Company's stock
fell to $4.60 per share.
For more details, contact William Lerach or Darren Robbins of
Lerach Coughlin by Phone: 800-449-4900 or 619-231-1058 by E-
mail: wsl@lerachlaw.com or visit their Web site:
http://www.lerachlaw.com/cases/carrieraccess/.
CORN PRODUCTS: Milberg Weiss Lodges Securities Fraud Suit in IL
---------------------------------------------------------------
The law firm of Milberg Weiss Bershad & Schulman LLP initiated a
class action lawsuit on behalf of purchasers of the securities
of Corn Products International, Inc. (NYSE: CPO) ("Corn
Products" or the Company) between January 25, 2005 and April 4,
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 Northern District of Illinois (Eastern Division) against
defendants Corn Products, Samuel Scott (CEO) and Cheryl Beebe
(CFO).
The complaint alleges that Corn Products manufactures starches
and liquid sweeteners, including glucose corn syrups, high
maltose corn syrups and industrial and food-grade starches. Its
basic raw material is corn and, throughout the Class Period,
defendants maintained that they had properly hedged the
Company's exposure to corn price fluctuations. The truth emerged
on April 4, 2005 after the market closed, when it became clear
that the Company had not, as it had claimed, properly hedged its
corn position. On that date, defendants announced that first-
quarter 2005 estimated earnings per share would be down 35-40%
year-over-year due to higher net corn costs, higher energy and
freight costs, and undisclosed "manufacturing expense problems"
(later revealed to have arisen from "freakish" manufacturing
problems at several plants in the U.S. and Canada). On this
news, Corn Product shares, which had closed at $25.86 on April
4, 2005, fell $5.75, or 22%, to a low of $20.11 before closing
out the day at $20.98.
For more details, contact Steven G. Schulman, Peter E. Seidman
or Andrei V. Rado of Milberg Weiss Bershad & Schulman LLP 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.
CORN PRODUCTS: Stull Stull Lodges Securities Fraud Lawsuit in IL
----------------------------------------------------------------
The law firm of Stull, Stull & Brody initiated a class action
lawsuit in the United States District Court for the Northern
District of Illinois on behalf of all persons who purchased the
securities of Corn Products International Inc. ("CornProducts"
or the "Company") (NYSE:CPO) between January 25, 2005, and April
4, 2005, inclusive (the "Class Period").
The complaint charges that Corn Products, Samuel Scott and
Cheryl Beebe with violations of the Securities Exchange Act of
1934. More specifically, the Complaint alleges that the Company
failed to disclose and misrepresented the following material
adverse facts, which were known to defendants or recklessly
disregarded by them:
(1) that the Company was experiencing manufacturing
problems at some of its facilities, which resulted in
increased manufacturing expenses;
(2) that the Company's net corn costs were significantly
higher due to the Company's speculative hedging of
Canadian corn;
(3) that US sweetener price increase, contrary to the
Company's representations, failed to offset higher
energy costs; and
(4) that as a result of the foregoing, defendants lacked
any reasonable basis for their positive statements
concerning the Company and its earnings and prospects.
On April 5, 2005, Corn Products said that it expected first-
quarter diluted earnings per share to decline 35 percent to 40
percent from the first quarter of 2040. News of this shocked the
market. Shares of Corn Products fell $4.88 per share or 18.87
percent, on April 5, 2005, to close at $20.98 per share.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody by Phone: 1-800-337-4983 by Fax: 212/490-2022 by E-mail:
SSBNY@aol.com or visit their Web site: http://www.ssbny.com.
DREAMWORKS ANIMATION: Abbey Gardy Lodges Securities Suit in CA
--------------------------------------------------------------
The law firm of Abbey Gardy, LLP commenced a Class Action
lawsuit on behalf of all purchasers of securities of DreamWorks
Animations SKG, Inc. ("DreamWorks" or the "Company") (NYSE: DWA)
between October 27, 2004 and May 10, 2005, inclusive (the "Class
Period").
The Complaint alleges that defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of material
misrepresentations to the market during the Class Period thereby
artificially inflating the price of DreamWorks securities. The
action captioned Pfeffer v. DreamWorks Animation SKG, Inc., et
al., is pending in the United States District Court for the
Central of California against defendants DreamWorks, Jeffery
Katzerberg (Chief Executive Officer) and Roger Enrico (Chairman
of the Board).
The Complaint alleges that starting on October 27, 2004 and
continuing until May 10, 2005, defendants made a series of
materially false and misleading statements regarding the about
Dreamworks business and earnings. During the Class Period the
Company filed its Form 10-K for its year ended December 31,
2004. In addition, the Company issued press releases on November
8, 2004, March 17, 2005 and May 10, 2005. The Complaint alleges
that throughout the Class Period, defendants failed to disclose
and misrepresented the following material adverse facts known to
defendants or recklessly disregarded by them:
(1) that sales of Shrek2 DVD's were declining;
(2) retailers were returning to the Company massive amounts
of unsold Shrek 2 DVD inventory;
(3) the Company was shipping products far in excess of the
actual demand for those products; and
(4) as a result of the foregoing, defendants' opinions and
statements concerning the Company's current and future
earnings lacked a reasonable basis at all times.
On May 10, 2005, Dreamworks announced that Shrek 2 did not meet
the company's retail sales expectations for the first quarter.
The Company reported for the first time that the "sales
shortfall resulted in a higher level of returns than expected.
As a result, DWA recorded no revenue from Shrek 2 in the quarter
other than from licensing and merchandising." On this news the
price of DreamWorks stock dropped from $36.50 to close at
$32.05.
For more details, contact Susan Lee or Nancy Kaboolian, Esq. of
Abbey Gardy, LLP by Mail: 212 East 39th Street, New York, New
York 10016 by Phone: (212) 889-3700 or (800) 889-3701 by E-mail:
slee@abbeygardy.com or visit their Web site:
http://www.abbeygardy.com.
DREAMWORKS ANIMATION: Marc S. Henzel Files Securities Suit in CA
----------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the Central of
California on behalf of all purchasers of securities of
DreamWorks Animations SKG, Inc. (NYSE: DWA) between October 27,
2004 and May 10, 2005, inclusive (the "Class Period"). The
Complaint alleges that defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of material
misrepresentations to the market during the Class Period thereby
artificially inflating the price of DreamWorks securities.
The action is pending in the United States District Court for
the Central of California against defendants DreamWorks, Jeffery
Katzerberg (Chief Executive Officer) and Roger Enrico (Chairman
of the Board).
The Complaint alleges that starting on October 27, 2004 and
continuing until May 10, 2005, defendants made a series of
materially false and misleading statements regarding the about
Dreamworks business and earnings. During the Class Period the
Company filed its Form 10-K for its year ended December 31,
2004. In addition, the Company issued press releases on November
8, 2004, March 17, 2005 and May 10, 2005. The Complaint alleges
that throughout the Class Period, defendants failed to disclose
and misrepresented the following material adverse facts known to
defendants or recklessly disregarded by them:
(1) that sales of Shrek2 DVD's were declining;
(2) retailers were returning to the Company massive amounts
of unsold Shrek 2 DVD inventory;
(3) the Company was shipping products far in excess of the
actual demand for those products; and
(4) as a result of the foregoing, defendants' opinions and
statements concerning the Company's current and future
earnings lacked a reasonable basis at all times.
On May 10, 2005, Dreamworks announced that Shrek 2 did not meet
the company's retail sales expectations for the first quarter.
The Company reported for the first time that the "sales
shortfall resulted in a higher level of returns than expected.
As a result, DWA recorded no revenue from Shrek 2 in the quarter
other than from licensing and merchandising." On this news the
price of DreamWorks stock dropped from $36.50 to close at
$32.05.
For more details, contact Law Offices of Marc S. Henzel by Mail:
273 Montgomery Ave., Suite 202, Bala Cynwyd, PA 19004 by Phone:
610-660-8000 or 888-643-6735 by Fax: 610-660-8080 or by E-mail:
mhenzel182@aol.com.
GRAVITY CO.: Murray Frank Files Securities Fraud Suit in S.D. NY
----------------------------------------------------------------
The law firm of Murray, Frank & Sailer LLP initiated a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of all securities
purchasers of Gravity Co., Ltd. ("Gravity" or "the company")
(Nasdaq:GRVY) between February 7, 2005 and May 12, 2005,
inclusive (the "Class Period").
The Complaint charges Gravity and certain of the Company's
executive officers with violations of federal securities laws by
issuing materially false and misleading financial statements to
the investing public that caused the price of the Company's
stock to be artificially inflated. Gravity develops and
distributes online games and related businesses within Korea and
other countries worldwide. The Company's primary product,
Ragnarok Online, is commercially available in 19 markets.
Historically, revenues from Ragnarok Online have accounted for
the majority of the Company's revenue, with 95% of the Company's
revenue prior to the IPO attributable to that product.
The Complaint alleges defendants failed to disclose and
misrepresented material adverse facts, including that:
(1) Ragnarok Online was experiencing a material decline in
customer demand and increased competition in the
marketplace, which caused Ragnarok Online's revenues to
steeply decline;
(2) Gravity's mobile animation business was in such a dire
state that it was no longer capable of producing a
viable revenue stream for the Company; and
(3) the Company's statements about substantial growth
potential for online gaming were lacking in any
reasonable basis when made because Gravity's royalties
and license fees (for online gaming) were negatively
impacted by unfavorable trends in China which caused a
decline of Ragnarok Online revenues.
On May 12, 2005, Gravity announced disappointing financial
results for first-quarter 2005 which shocked the market, causing
Gravity's share price to tumble $3.64 per share -- more than 39%
-- to close at $5.60 per share on May 13, 2005.
For more details, contact Eric J. Belfi or Christopher S. Hinton
of Murray, Frank & Sailer LLP by Phone: (800) 497-8076 or
(212) 682-1818 by Fax: (212) 682-1892 by E-mail:
info@murrayfrank.com or visit their Web site:
http://www.murrayfrank.com/CM/NewCases/NewCases.asp.
XYBERNAUT CORPORATION: Murray Frank Lodges Securities Suit in DE
----------------------------------------------------------------
The law firm of Murray, Frank & Sailer LLP initiated a class
action lawsuit in the United States District Court for the
District of Delaware on behalf of shareholders who purchased or
otherwise acquired the securities of Xybernaut Corporation
(XYBR) ("Xybernaut" or the "Company"; (Pink Sheets:XYBR) between
May 10, 2002 and April 8, 2005, inclusive (the "Class Period").
The complaint alleges that during the Class Period defendants
issued materially false and misleading financial statements to
the investing public regarding its financial performance,
financial condition and internal controls in violation of
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b 5 promulgated thereunder.
Xybernaut develops, markets and sales mobile/wearable computing
and communication systems. During the Class Period, defendants
made numerous positive statements in press releases and filings
with the SEC concerning the Company's financial performance and
future prospects. On March 31, 2005, after the close of trading,
Xybernaut announced that it was commencing an internal
investigation of the Company's internal controls, the propriety
of certain expenditures of the Chairman and CEO of the Company,
the Company's public disclosure process, the accuracy of certain
public disclosures, management's conduct in response to the
investigation, and the propriety of certain major transactions.
The press release further stated that the Company had received a
subpoena from the Securities and Exchange Commission seeking
information relating to the sale of Company securities by any
person identified as a selling shareholder in any Company
registration statement or other public filing.
After the close of trading on April 8, 2005, Xybernaut issued a
press release announcing directing investors to refrain from
relying on the Company's financial statements issued for the
years ended December 31, 2002 and 2003 covering the 2002 and
2003 annual periods and interim quarterly reports for the
quarters ended March 31, 2003, June 30, 2003, September 30,
2003, March 31, 2004, June 30, 2004 and September 30, 2004.
Subsequent to these disclosures, both the Company's CEO and
President have been removed, an investigation has been initiated
by the U.S. Attorney for the Eastern District of Virginia, and
the Company's stock has been de-listed by Nasdaq.
On April 19, 2005, Xybernaut announced the completion of its
internal investigation. Among other findings, the committee in
charge of the investigation found that the Company's Chairman
and CEO, Edward G. Newman ("Newman"), improperly used
substantial Company funds for personal expenses, that Newman
violated internal policies by implementing a systematic policy
of nepotism and violated disclosure regulations of the SEC by
failing to disclose the Company's employment of certain
relatives of Newman, and that the Company lacked adequate
internal controls concerning public disclosures and the
execution of major transactions.
The Complaint alleges that the systematic failures resulted in
the Company issuing statements concerning its financial
performance and business outlook that were materially false and
misleading and materially overstated the Company's financial
performance and financial condition.
For more details, contact Eric J. Belfi or Christopher S. Hinton
of Murray, Frank & Sailer LLP by Phone: (800) 497-8076 or
(212) 682-1818 by Fax: (212) 682-1892 by E-mail:
info@murrayfrank.com or visit their Web site:
http://www.murrayfrank.com/CM/NewCases/NewCases.asp.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
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Class Action Reporter is a daily newsletter, co-published by
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USA. Glenn Ruel Senorin, Aurora Fatima Antonio and Lyndsey
Resnick, Editors.
Copyright 2004. All rights reserved. ISSN 1525-2272.
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