/raid1/www/Hosts/bankrupt/CAR_Public/050722.mbx
C L A S S A C T I O N R E P O R T E R
Friday, July 22, 2005, Vol. 7, No. 144
Headlines
ANTI-SPAM LITIGATION: FTC Charges 7 Firms For Explicit Spam Mail
ARKANSAS: Defendants Want "Pay Per Click" Suit in Federal Court
BIOLASE TECHNOLOGY: CA Court Consolidates Securities Fraud Suits
CAL POLY: Program Gets Windfall From Methionine Antitrust Deal
CANADA: Smiths Falls Mayor Supports Lawsuit to Stop RRC Closure
CANADA: Residents Mull Property Damage Suit V. Red Hill Valley
CARBON FIBER: Antitrust Settlement Hearing Set August 11, 2005
CARDIZEM CD: Pennsylvania To Participate in Antitrust Settlement
CARDIZEM CD: UT Residents To Receive Antitrust Settlement Share
CARDIZEM CD: WA Residents To Get Share in Antitrust Settlement
CARDSYSTEMS SOLUTIONS: Visa, Amex Cuts Ties For Security Breach
CONAGRA FOODS: Retiree Lodges Suit Over Earnings Manipulation
DAN NELSON: SD AG To Help Customers of Closed Car Dealership
ELECTRICAL CARBON: Suit Settlement Hearing Set November 10, 2005
ENRON CORPORATION: WA To Participate in $1.52B Multistate Pact
ESPEED INC.: Individual Investors Achieve Lead Plaintiff Status
FLORIDA: AG Crist Files Suit V. Three Firms For Medicaid Fraud
HSBC USA: Call Center Employees Launch Overtime Wage Suit in NY
KANSAS: Vietnamese Group Sues Wichita Diocese Over Money Shift
LOUISIANA: French Quarter Residents File Parking Meter Suit
MICHELIN: Refund Offer Not Likely To Please US Grand Prix Fans
MICHIGAN: Grosse Point Park Losses Lawsuit Over Flood Insurance
OHIO: OHCA Launches Suit Over Biennial Budget Bill's Provisions
OHIO: Presiding Judge OKs $120M Fund For Priest Abuse Victims
PEPSI BOTTLING: Receives $24M Share in Corn Syrup Antitrust Pact
PIZZA HUT: CA Court Strikes Certain Class Members From FLSA Suit
PRB CONTRACTING: VT AG Initiates Home Improvement Fraud Lawsuit
SOUTH DAKOTA: AG To Give Share in Taxol Settlement To Charities
TXU ELECTRIC: Rusk City Accepts Share Ratepayer Suit Settlement
TOYOBO COMPANY: Ohio To Receive Share in Zylon Vest Settlement
UNITED STATES: FDA Issues Safety Alert on Recalled Smoked Salmon
WASHINGTON: Utah Women Sue DOC Over Sex Offender's Supervision
Asbestos Alert
ASBESTOS LITIGATION: Dockyard Worker Dies from Asbestos Exposure
ASBESTOS LITIGATION: Party Urges Gov't to Rush Asbestos Removal
ASBESTOS LITIGATION: Conference Turns Focus on Staff Education
ASBESTOS LITIGATION: Derby School Case Adjourned Until September
ASBESTOS LITIGATION: EPA Probes Dumping Incident at AU Toll Road
ASBESTOS LITIGATION: UK Govt Expands Coverage in Benefits Scheme
ASBESTOS LITIGATION: Chase Corp.'s Lone Pending Suit Inactive
ASBESTOS LITIGATION: EPA Conducts Testing on Demolition Methods
ASBESTOS LITIGATION: Japan Asbestos Group Lobbying Delayed Laws
ASBESTOS LITIGATION: Court Upholds Junking of Suit V. John Crane
ASBESTOS LITIGATION: New U.S. Lawsuits Loom Before James Hardie
ASBESTOS LITIGATION: UK School Exposure Causes Teacher's Death
ASBESTOS LITIGATION: Group Finds Fault in Cape's Funding Scheme
ASBESTOS LITIGATION: CA Court Affirms Junking of 33 Suits V. CCR
ASBESTOS LITIGATION: Trains with Asbestos Insulation Pose Risks
ASBESTOS LITIGATION: Method to Detoxify Asbestos Removes Risks
ASBESTOS LITIGATION: Widow Vows to Campaign Against Mesothelioma
ASBESTOS LITIGATION: Gov't Report Could Signal a Surge of Suits
ASBESTOS LITIGATION: RI Court Denies GE's Motion to Dismiss Suit
ASBESTOS LITIGATION: W.R. Grace & Co. 2Q05 Profit Rises by 53%
ASBESTOS LITIGATION: SB 852 Challengers to Hold Forum Next Week
ASBESTOS LITIGATION: Munich Re Boosts US Unit Reserves by $1.6B
ASBESTOS LITIGATION: Japan Govt Urges Industry for Voluntary Ban
ASBESTOS LITIGATION: NSW Premier Drops Local Insulation Concerns
ASBESTOS LITIGATION: Claimants Seek to Propose USG's Ch. 11 Plan
ASBESTOS LITIGATION: Prosecutors Probe 3 Law Firms Over Claims
ASBESTOS LITIGATION: Workers Covered by Insurance Rises 53.7%
ASBESTOS LITIGATION: Japan Gov't Fails to Warn Against Asbestos
ASBESTOS LITIGATION: Legislation to Reach Senate Floor on Sept.
ASBESTOS LITIGATION: Study Reveals Asbestos in 90 Kansai Schools
ASBESTOS LITIGATION: UK Agency Probes Dumping at Housing Site
ASBESTOS ALERT: Former Employee Files Lawsuit V. EMI Group PLC
ASBESTOS ALERT: DEP Halts NY Bldg Project for Disposal Breaches
ASBESTOS ALERT: GA Court Favors Prison Officers in Inmate's Suit
ASBESTOS ALERT: NY Court Affirms Ruling V. Appalachian Insurance
ASBESTOS ALERT: DE Court Remands Claimant's Petition V. 2 Firms
ASBESTOS ALERT: Hexion's Bakelite Incurs Liability for Cleanups
New Securities Fraud Cases
AVAYA INC.: Wolf Haldenstein Files ERISA Class Action Suit in NJ
MAJESCO ENTERTAINMENT: Charles J. Piven Lodges Stock Suit in NJ
MAJESCO ENTERTAINMENT: Shepherd Finkelman Files Stock Suit in NJ
MAJESCO ENTERTAINMENT: Schiffrin & Barroway Lodges Suit in NJ
RAMP CORPORATION: Abraham Fruchter Lodges Securities Suit in NY
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ANTI-SPAM LITIGATION: FTC Charges 7 Firms For Explicit Spam Mail
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In a crackdown on operations that illegally expose unwitting
consumers to graphic sexual content, the Federal Trade
Commission charged seven companies with violating federal laws
requiring warning labels on e-mail that contains sexually-
explicit content.
Federal suits filed against three operations seek civil
penalties and a permanent bar on the illegal marketing.
Settlements with four other operations have imposed $1.159
million in civil penalties. The settlements bar the illegal
marketing practices in the future and require that the
defendants monitor their affiliates to ensure they are not
violating the law.
"This x-rated e-mail is electronic flashing," said Lydia Parnes,
Director of the Bureau of Consumer Protection. "It exposes kids
and other unwary consumers to graphic sexual content, and it is
unwanted, offensive, and illegal."
"The Adult Labeling Rule was designed to protect consumers who
don't want to be exposed to random assaults of sexual material
and others, like kids, for whom it is inappropriate. It's the
law, and we intend to enforce it," Parnes said.
The FTC's Adult Labeling Rule and the CAN-SPAM Act require
commercial e-mailers of sexually-explicit material to use the
phrase "SEXUALLY EXPLICIT: " in the subject line of the e-mail
message and to ensure that the initially viewable area of the
message does not contain graphic sexual images. The Rule and the
Act also require that unsolicited commercial e-mail contain an
opportunity for consumers to opt out of receiving future e-mail
and provide a postal address, among other things. The FTC
charged that the companies sent sexually-explicit e-mail
messages that:
(1) violated the Adult Labeling Rule requirements;
(2) violated the requirement to provide a clear and
conspicuous opt-out mechanism; and
(3) violated the requirement to provide a postal address.
While the defendants did not send e-mail directly to consumers,
they operated "affiliate marketing" programs in which they paid
others to send spam on their behalf. Under the CAN-SPAM Act, the
defendants are liable for the illegal spam sent by their
affiliates because the defendants "initiated" the e-mail by
paying others to send it on their behalf.
The settlements bar future violations of the CAN-SPAM Act and
the Adult Labeling Rule. They also require that the defendants
closely monitor the practices of their affiliate marketers to
insure that they are not violating the law. The participants
are:
(i) BangBros.com Inc., based in Florida, will pay $650,000
in civil penalties;
(ii) MD Media, a Michigan corporation, will pay $238,743;
(iii) APC Entertainment, Inc., a Florida corporation, will
pay $220,000; and
(iv) Pure Marketing Solutions, LLC, a Florida company, and
Internet Matrix Technology, a corporation based in
Louisiana, will together pay $50,000.
The settlements contain record-keeping provisions to allow the
FTC to monitor the defendants' compliance with the orders. In
addition to the settlements, at the request of the FTC, the
Department of Justice (DOJ) has filed suit in U.S. District
Courts citing three other operations for violations of the CAN-
SPAM Act and the Adult Labeling Rule:
(a) TJ Web Productions, LLC, a Nevada company;
(b) Cyberheat, Inc., an Arizona Corporation; and
(c) Impulse Media, a Washington corporation.
Microsoft Corporation provided valuable technical assistance in
the investigation of these cases.
The Commission votes to file the complaints in the Cyberheat,
Impulse Media and TJ Web Productions cases were 5-0. Votes in
the other matters were 4-0. The proposed stipulated final
judgments and orders will be filed by the DOJ at the request of
the FTC. They are subject to court approval.
Copies of the complaints and consents 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 details, contact
Claudia Bourne Farrell, Office of Public Affairs, by Phone:
202-326-2181 or Jonathan M. Kraden of the Bureau of Consumer
Protection by Phone: 202-326-3257 or visit the Website:
http://www.ftc.gov/opa/2005/07/alrsweep.htm.
ARKANSAS: Defendants Want "Pay Per Click" Suit in Federal Court
---------------------------------------------------------------
Web search companies America Online, Google, Yahoo and others
filed a petition with the 8th U.S. Circuit Court of Appeals at
St. Louis, relating to the lawsuit alleging they overcharged for
Internet "pay per click" advertising, arguing that the suit
belongs in federal court, not the Arkansas court system, The
Associated Press reports.
The companies, which filed their petition with 8th U.S. Circuit
Court of Appeals at St. Louis is seeking permission to appeal a
court ruling by U.S. District Judge Harry Barnes, who recently
ruled that the suit properly belongs in Miller County Circuit
Court, where it was filed on February 4 by Lane's Gifts and
Collectibles of Texarkana. The plaintiffs have asked that the
complaint be designated as a class action suit, and has since
bounced up and down the court system stem from disagreements
over where the suit should be heard in light of a new federal
law.
The suit was filed in state court right before approval by
Congress of a new law that designated federal courts as the
primary location for class action lawsuits. Judge Barnes ruled
that meant that the new law did not apply to the case. Under
the new law, which Congress approved on February 18, class
action suits seeking $5 million or more would be heard in state
court only if the primary defendant and more than one-third of
the plaintiffs are from the same state. But if less than one-
third of the plaintiffs are from the same state as the primary
defendant, and more than $5 million is at stake, the case would
go to federal court. However, the petition by the defendants
argues that the date Judge Barnes should have considered in
deciding where the case should be heard was March 30, which was
the day a petition was filed in federal court to remove the case
from the state court.
In addition, the defendants' petition stated, "This appeal
presents the first opportunity for this circuit to decide the
proper interpretation of the act's effective-date provision.
Deciding the issue now will remove uncertainty, which was the
reason Congress altered long-standing law to permit an appeal
like this one, and ensure that these suits are heard in federal
court where they belong." The petition also argued, "it makes
sense to construe 'commenced' to include the date an action
begins in federal court with the filing of a removal notice."
As previously reported in the July 14, 2005 edition of the Class
Action Reporter, the suit claims that the Internet companies
charged Lane's for advertising traffic not generated by bona
fide customers. It specifically alleges that the defendant
companies worked with one another in a conspiracy to create an
online environment that harms advertisers. The suit also states
that the companies "have grown the Internet PPC (pay per click)
advertising market while failing to disclose that they have
routinely and systematically overcharged and-or over collected
for PPC advertising revenue from their customers."
In the online advertising world, businesses pay Internet
providers a fee based on the number of times their ads are
"clicked." The click takes would-be customers to another page
for more information. Lane's alleges that these ads are often
clicked only to generate a bigger bill for advertisers, not by
someone truly seeking more information.
Other defendants in the suit are, Yahoo! Inc., Overture Services
Inc., Time Warner Inc., America Online Inc., Netscape
Communications Corp., Ask Jeeves Inc., Buena Vista Internet
Group doing business as Go.Com, Google Inc., Lycos Inc.,
Looksmart Ltd. and Findwhat.com Inc.
BIOLASE TECHNOLOGY: CA Court Consolidates Securities Fraud Suits
---------------------------------------------------------------
The United States District Court for the Central District of
California ordered consolidated the securities class actions
filed against Biolase Technology, Inc. and certain of its
officers in the United States District Court for the Central
District of California. The complaints purport to seek
unspecified damages on behalf of an alleged class of persons who
purchased the Company's common stock between October 29, 2003
and July 16, 2004.
The complaints allege that the Company and its officers violated
federal securities laws by failing to disclose material
information about the demand for our products and the fact that
the Company would not achieve the alleged forecasted growth.
The claimed misrepresentations include certain statements in the
Company's press releases and the registration statement the
Company filed in connection with our public offering of stock in
March 2004.
The suit is styled "Van Dam Holdings Ltd. v. Biolase Technology,
Inc., et al, case no 8:04-cv-947," filed in the United States
District Court for the Central District of California, under
Judge David O. Carter. Lead plaintiffs Alan Harvey and
Elizabeth Paul are represented by Dale Joseph MacDiarmid, Lionel
Z Glancy, Peter Arthur Binkow of Glancy Binkow and Goldberg,
1801 Avenue of the Stars, Suite 311 Los Angeles, CA 90067, USA,
Phone: 310-201-9150.
CAL POLY: Program Gets Windfall From Methionine Antitrust Deal
--------------------------------------------------------------
Cal Poly State University's Animal Science program received
$500,000 for its animal nutrition research and instruction
programs as the result of a settlement of an industry-wide class
action suit and could possibly receive more funding later this
year. Cal Poly could receive additional funds from the
settlement fund before the end of 2005, depending on final
resolution of the case, said Animal Science Department Head Andy
Thulin.
Cal Poly was not a plaintiff in the original suit resulting in
the settlement, but was chosen to receive the funding because of
its strong animal nutrition program. "This money will
significantly enhance the department's ability to do research
and educate students about cutting-edge technologies that will
ultimately benefit California," Mr. Thulin said.
To receive the settlement funding, Cal Poly submitted a proposal
after being contacted along with other universities by the law
firms overseeing the settlement. Mr. Thulin's proposal outlined
the Cal Poly Animal Science program, its offerings, and what the
university would do with the settlement money if received.
The strength of the university's program and its partnership
with a strong advisory board of industry representatives aided
Cal Poly in receiving the settlement funding, Mr. Thulin said.
"Cal Poly's Animal Science Department is a national leader in
undergraduate training in animal nutrition and reproductive
biology. We're expanding and improving the biotechnology program
and we're particularly strong in beef, equine, poultry, and
swine studies," Thulin said.
One project already lined up for the department is research into
reducing phosphates, nitrates and other components of animal
waste in commercial swine operations, Mr. Thulin said. Cal Poly
is already involved in several avian nutrition and immunology
research projects through its Foster Farms professorship and
poultry science program, he noted.
The unanticipated $500,000 comes at a critical time; Cal Poly's
Animal Science Department is about to launch into a $12 million
construction project to build four new facilities. They include
a new animal nutrition center, beef center and feedlot, and a
meat processing center, with associated classrooms, labs and
animal areas. The facilities are being relocated and rebuilt to
make way for a new student housing project set to break ground
this fall.
Cal Poly has secured $8 million in state funding for the animal
science construction projects, and the department is on a drive
to raise the remaining $4 million over the next several months.
The bulk of the $500,000 settlement, and any future monies
received from the settlement, will go toward building the new
campus animal nutrition center, Mr. Thulin said. Anyone
interested in contributing to the department's fund-raising
drive can contact Mr. Thulin or development officer Andy Carlin
at the department office at (805) 756-2419.
The university received the $500,000 check June 29 from a class
action settlement fund involving a suit by purchasers of animal
feeds against the makers of a synthetic animal feed ingredient
called methionine. The ingredient is an amino acid found
naturally in soybeans that is a key component of swine and
poultry feed.
The original lawsuits, filed in California, accused several
international synthetic methionine manufacturers of global
price-fixing. The court-approved settlement provided that at
least $500,000 in payments agreed to by the methionine makers is
used to further animal nutrition research and education.
Attorneys for the plaintiffs reviewed several other animal
nutrition programs and learned details of Cal Poly's program.
Attorney Dario de Ghetaldi of Corey, Luziach, Pliska, De
Ghetaldi & Nastari and Michele C. Jackson of Lieff Cabraser
Heimann & Bernstein proposed Cal Poly to the court as the
recipient of the $500,000. The court agreed.
Ms. Jackson and Mr. de Ghetaldi said in a joint statement that
they are sure Cal Poly will put the funds to good use and their
law firms are gratified by being able to assist Cal Poly's
Animal Science program.
CANADA: Smiths Falls Mayor Supports Lawsuit to Stop RRC Closure
---------------------------------------------------------------
The mayor of Smiths Falls, Dennis Staples is supporting a legal
action by Toronto attorney James Gray that seeks to keep the
Rideau Regional Center from closing its doors, The Brockville
Recorder & Times reports.
As previously reported in the July 21, 2005 edition of the Class
Action Reporter, Mr. Gray issued a claim as a guardian for his
sister Ann Gray and filed a class action lawsuit against the
Province of Ontario, Ontario Premier Dalton McGuinty, Community
and Social Services Minister Sandra Pupatello and "any other
minister or Crown officer" involved in the impending closure of
the Rideau Regional Center (RRC) located just outside of Smiths
Falls. It was filed on behalf of the families of Rideau center
residents. Mr. Gray's lawyer is to be in Superior Court in Perth
on August 26, where she will seek an injunction to keep the
center open while the case proceeds.
Following a recent town council meeting Mayor Staples told The
Brockville Recorder & Times reports, "I'm hoping it will work.
I'm hoping that a sober second look will be taken in terms of
the policy direction." Mr. Staples is a former finance director
and administrator at the facility, which is home to
approximately 430 residents, many of whom have severe
developmental disabilities. He also told The Brockville Recorder
& Times, "I know the type of care that is provided."
The mayor called the closure, which was announced last September
by Community and Social Services Minister Sandra Pupatello, an
"injustice" to residents and their families. He told The
Brockville Recorder & Times, "Some of the individuals there have
high needs, some of them can't see, can't talk, can't walk,
can't feed themselves. The parents are concerned about what's
going to become of them."
In addition, Mayor Staples also told The Brockville Recorder &
Times that Ms. Pupatello and her ministry have done nothing to
allay the concerns of families since announcing the closure,
which is to be completed by March 2009. In fact, according to
him, they've broken promises by saying, "She said there was
going to be public consultation well, that hasn't taken place
yet. They were supposed to do it this past winter." The mayor
further stated that the government's assurances that displaced
residents would find a support system in the community haven't
been backed up with evidence the high level of care required by
residents actually exists outside the center. Commenting on that
situation, he told The Brockville Recorder & Times, "If that's
the case, I wish the ministry would come out and put everybody's
mind at ease," adding, "I'm not convinced (the supports) are or
will be (there)."
CANADA: Residents Mull Property Damage Suit V. Red Hill Valley
--------------------------------------------------------------
Red Hill Valley, Canada faces a potential $60 million lawsuit
from its residents, alleging the city failed to properly protect
homeowners who live along the proposed Red Hill Creek
Expressway, Mountain News reports.
The Red Hill Valley Neighbourhood Association (RHVNA) is
preparing to file the suit. The city has identified 101
households that will be affected by expressway. The association
believes that up to 500 more households will also be affected by
the traffic, noise and air pollution, and falling property
values.
Residents in the Red Hill Neighbourhood are fed up with city
officials offer of constructing a barrier, installing triple
glaze windows and an air conditioner to reduce noise and air
pollution, Richard Reble, spokesperson for the association, told
Mountain News. "Many of the residents believe we should have
taken the action sooner," said Mr. Reble.
Eric Gillespie, who is representing RHVNA, told Mountain News
the decision to follow through on their legal threat will be
determined by city officials' response to their offer to further
review health studies conducted on residents living near
highways in other jurisdictions. He said the news conference,
held at city hall and including a representative from the Sierra
Club of America, was to provide city officials time to
"reconsider their position." "There is no doubt, should we be
unable to reach a resolution, legal action will follow," Mr.
Gillespie said, who refused to characterize his clients'
announcement as a threat to the city.
"The compensation package put in front of residents is not
sufficient and the law appears to support that position. These
are the options that RHVNA have available to it. And it will
depend a large measure on the city which of the options
ultimately RHVNA pursues," Mr. Gillespie told Mountain News.
However, Mr. Gillespie has delayed the formal submission of
legal documents against the city because he is waiting for a
judgement from the Ontario Court of Appeal in the case of
"Pearson vs Inco," involving whether or not Port Colborne
residents can sue the large nickel company either individually
or in a class action suit. A decision isn't expected until
later in the fall. Once the decision is revealed, Mr. Gillespie
told Mountain News he will launch the lawsuit against the city.
The $60 million figure is based upon compensation claims of
between $10,000 to $250,000 on 500 homes. Mr. Gillespie said he
would prefer to seek legal action by way of a class action suit.
Residents have provided the city with some information about
health effects, but "we have not heard from the city in the last
month," Mr. Gillespie told Mountain News. "We needed to
kickstart the discussion. This (news conference) may do it."
Mr. Gillespie said there are already residents suffering
illnesses due to the construction of the project. There is also
an undetermined number of homeowners who are asking the city to
purchase their properties and relocate them, Mr. Gillespie told
Mountain News. The cost, the association believes, should be
paid by the municipality since the expressway will benefit all
of the city.
"There is no hard number (of the number of people who want to
move). But there are significant numbers," said Mr. Gillespie.
"Many people do enjoy living in east Hamilton. And giving proper
mitigation they could stay. There are other people that truly
believe it is not possible for them to live there."
CARBON FIBER: Antitrust Settlement Hearing Set August 11, 2005
--------------------------------------------------------------
The United States District Court for the Central District of
California, Western Division will hold a fairness hearing for
the proposed settlement by defendants BP Amoco Polymers, Inc.
and Hercules, Inc. in the matter: In re Thomas & Thomas
Rodmakers, Inc., et al. v. Newport Adhesives Composites, Inc.,
et al., Case No. CV-99-07796-FMC (RNBx), on behalf of all
persons (excluding government entities, defendants, their
subsidiaries and affiliates) who purchased carbon fiber in the
United States directly from the defendants or any subsidiary or
affiliate thereof, at any time during the period from January 1,
1993 through January 31, 1999.
The hearing will be held on August 11, 2005, at 2:30 p.m.,
before the Honorable Florence-Marie Cooper, at the Edmond R.
Roybal Federal Building and Courthouse, 255 East Temple St., Los
Angeles, CA.
For more details, contact Carbon Fiber Antitrust Litigation, c/o
Heffler Radetich & Saitta, LLP, P.O. box 410, Philadelphia, PA,
19105-0410, E-mail: http://www.hrsclaimsadministration.comOR
Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, Phone:
(800) 449-4900.
CARDIZEM CD: Pennsylvania To Participate in Antitrust Settlement
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Nearly $1.4 million will be released this week to 4,700
Pennsylvania residents who were prescribed the heart drug
Cardizem CD between 1998 and 2004. Each consumer will receive an
average refund of $317, state Attorney General Tom Corbett today
announced in a statement.
The funds represent a portion of a $24 million settlement
between 50 state Attorneys General and New Jersey-based Aventis
Pharmaceuticals Inc., and Andrx Corporation, located in Kansas
City, Missouri. Aventis Pharmaceuticals, the maker of Cardizem
CD, and Andrx, a generic drug company, were accused of engaging
in a price-fixing scheme that violated state and federal
antitrust laws.
Mr. Corbett said the 2003 settlement resolves claims that
beginning in July 1998 Hoechst, one of the world's largest
pharmaceutical companies, acquired by Aventis in 2000, along
with Andrx illegally agreed that Andrx would stay out of the
market and not produce a less expensive generic version of
Cardizem CD. In return, Aventis agreed to pay Andrx nearly $90
million. States' investigators claimed that the delay in the
availability of the generic form of Cardizem CD meant that
patients without prescription drug coverage, medical insurance
companies and the government had to pay a much higher price for
the brand name version of the drug for at least an extra year.
"This alleged price-fixing scheme forced thousands of
Pennsylvanians to pay more for a life saving heart drug because
the parties consciously and illegally manipulated the system,"
Mr. Corbett said. "Today, we begin to return to consumers what
should never have been taken in the first place." He said the
distribution to third party purchasers of the drug will begin
later this year. In addition, approximately $4.5 million will be
distributed among the states to reimburse certain government
purchasers, including Medicaid.
Under the terms of the 2003 settlement, Aventis and Andrx will
pay the states $24 million in restitution to 76,000 consumers
nationwide including 4,700 from the Commonwealth. The checks
will be released to consumers this week by the claims
administrator. This settlement is in addition to a $110 million
agreement reached earlier between the companies and drug
wholesalers involving similar alleged antitrust violations.
The Commonwealth's case was negotiated by Chief Deputy Attorney
General James A. Donahue III and Deputy Attorney General
Benjamin Cox of Corbett's Antitrust Section in Harrisburg. For
more details, contact the Pennsylvania Office of Attorney
General by Mail: 16th Floor Strawberry Square, Harrisburg, PA
17120 by Phone: 717-787-5211 by Fax: 717-787-8242 or visit the
Website: http://www.attorneygeneral.gov/contact/Index.cfm.
CARDIZEM CD: UT Residents To Receive Antitrust Settlement Share
---------------------------------------------------------------
Hundreds of Utah heart patients will be getting a healthy refund
soon for being overcharged for the heart medication Cardizem CD,
Attorney General Mark Shurtleff announced in a statement. 405
Utahns will receive a total of $126,907 from a multi-state
antitrust settlement with two pharmaceutical companies.
Aventis Pharmaceuticals Inc. and Andrx Corporation agreed to pay
$80 million for delaying the sales of generic versions of
Cardizem CD. The lawsuit alleged that in July 1998, Hoechst, a
pharmaceutical company acquired by Aventis in 2000, paid Andrx
to withhold marketing of the generic version of the heart
medication.
"Those delays meant higher prices for consumers and higher taxes
for everyone else because government agencies also had to pay
the inflated price," says Mr. Shurtleff. "It's about time these
drug companies gave the money back."
Utahns who purchased Cardizem CD between 1998 and 2002 will
receive an average refund of $313. The checks will begin to be
mailed from the court-appointed administrator this week. Utah
will also receive more than $80,600 to recover damages incurred
by the state, plus attorneys fees and costs incurred in the
litigation. Assistant Attorney General Ronald Ockey represented
Utah in the settlement.
For more details, contact Paul Murphy by Phone: (801)538-1892 or
visit the Attorney General's Website:
http://www.attorneygeneral.utah.gov/settlements.html.
CARDIZEM CD: WA Residents To Get Share in Antitrust Settlement
--------------------------------------------------------------
Washington residents who paid high prices for a popular heart
medication will share nearly $403,000 in refunds from an
antitrust case settlement, Attorney General Rob McKenna
announced in a statement. The state began mailing checks to
1,127 consumers on July 18,2005.
The payments are the result of a nationwide settlement with two
drug companies that made a pact to delay the availability of a
generic equivalent of Cardizem CD. Cardizem CD is used to treat
chest pain, high blood pressure and heart disease.
"Thousands of patients whose lives depended on Cardizem CD were
manipulated into paying more than they should for the medicine,"
Mr. McKenna said. "This was not a case of a company trying to
earn a reasonable profit for a new product. It was a deliberate
and illegal maneuver by two drug manufacturers who sought to
enrich themselves at the expense of vulnerable consumers."
Washington was among 27 states and several private plaintiff
groups that sued Aventis and Andrx. The states alleged that
Aventis, maker of Cardizem CD, paid Andrx nearly $90 million to
keep a cheaper generic form of the drug off the market. As a
result, consumers, medical insurance companies and the
government had to purchase the higher-priced, brand-name version
of the drug for a year. The defendants settled in 2002 but the
case remained in limbo while a third-party appealed. In May, the
U.S. Supreme Court refused to hear the final appeal and a trial
judge approved the reimbursements. Aventis and Andrx will pay a
total of $80 million.
The settlement will benefit more than 76,000 consumers
throughout the U.S. and Puerto Rico who bought Cardizem CD
between January 1998 and January 2003. Those consumers, who were
represented by the states, will share a total of $24 million.
In addition, $4.5 million will be distributed among the states
to reimburse certain government purchasers, including Medicaid.
Washington agencies, including the Washington State Procurement
Office, Department of Social and Health Services, Washington
Health Care Authority, University of Washington Medical Center
and Harborview Medical Center, will receive nearly $126,500.
The states will also receive $2.5 million as reimbursement for
legal fees and other costs connected with the lawsuit;
Washington's share is $150,000. The remaining $49 million will
be paid to consumers represented in private class actions.
The deadline to submit reimbursement claims was November 2003.
Fewer Washington residents submitted claims than initially
predicted, but individual payments exceeded earlier estimates.
Refund amounts will vary depending on consumer purchases.
Further details are available on the settlement administration's
Website: http://www.cardizemsettlement.com.
For more information, contact Kristin Alexander, Public
Information Officer, by Phone: (206) 464-6432 or Brady Johnson,
Assistant Attorney General, by Phone: (206) 389-2848 or visit
the Website: http://www.atg.wa.gov/
CARDSYSTEMS SOLUTIONS: Visa, Amex Cuts Ties For Security Breach
---------------------------------------------------------------
Credit card giants Visa USA, Inc. and American Express Co. are
severing ties with payment-processing company CardSystems
Solutions, Inc., after a breach in the Company's computer
network left 40 million credit and debit card accounts
vulnerable to hackers, the Associated Press reports.
In June 2005, hackers installed a rogue computer program that
extracted data, potentially compromising as many as 22 million
Visa-branded cards and 14 million MasterCard-branded cards, as
well as others. According to news reports, records on about
200,000 credit cards may have been stolen, but not birth dates
or Social Security numbers.
On June 17,2005, MasterCard International also issued a
statement notifying its member financial institutions of a
breach of payment card data, which potentially exposed more than
40 million cards of all brands to fraud, of which approximately
13.9 million are MasterCard-branded cards. The Company's team of
security experts identified that the breach occurred at the
Tucson-based Company. The security breach occurred after
CardSystems the Company inappropriately held onto card data for
"research purposes" rather than deleting it, an earlier Class
Action Reporter story (June 5,2005) states.
CardSystems Solutions Inc. "has not corrected, and cannot at
this point correct, the failure to provide proper data security
for Visa accounts," Rosetta Jones, a spokeswoman for Foster
City, Calif.-based Visa, told AP. She said banks that issue
Visa cards would have until Oct. 31 to replace CardSystems with
one of the hundreds of other payment-processing companies in the
United States.
American Express also notified CardSystems it would sever their
relationship as of October, spokeswoman Judy Tenzer told AP.
CardSystems was a small part of American Express' network,
handling less than 0.5 percent of its transactions, she said.
Atlanta-based CardSystems released a statement saying it was
"disappointed and very surprised," and hoped Visa would
reconsider. The company did not address American Express'
decision, AP reports.
CardSystems told the FBI it learned of a potential breach of its
computer network on May 22, and the break-in was publicly
disclosed last month.
However, it appears the breach happened much earlier. Visa's
Jones told AP Australian banks had notified the credit card
company about fraud in January that at the time seemed isolated.
But later investigation revealed that the security hole at
CardSystems was responsible, she said. Visa said that while
CardSystems has taken some remediating actions since the breach
was disclosed, those could not overcome the fact that it was
inappropriately holding on to account information - purportedly
for "research purposes" - when the breach occurred, in violation
of Visa's security rules.
MasterCard International Inc. is taking a different tack with
CardSystems. The credit card company expects CardSystems to
develop a plan for improving its security by Aug. 31, "and as of
today, we are not aware of any deficiencies in its systems that
are incapable of being remediated," spokeswoman Sharon Gamsin
told AP. "However, if CardSystems cannot demonstrate that they
are in compliance by that date, their ability to provide
services to MasterCard members will be at risk," she said.
A spokeswoman for Discover Financial Services Inc., which also
has a relationship with CardSystems, declined to comment, AP
reports.
CONAGRA FOODS: Retiree Lodges Suit Over Earnings Manipulation
-------------------------------------------------------------
A third class action lawsuit this one from a retiree of ConAgra
Foods Inc., was filed in U.S. District Court in Nebraska,
accusing top executives of manipulating the Omaha-based
company's earnings, The Associated Press reports.
Filed by Michael Rantana on behalf of ConAgra employees who
bought the company's stock as part of their 401(k) plans after
September 18, 2003, the suit, which asks for unspecified
damages, accuses Bruce Rohde, ConAgra president, chief executive
and chairman, as well as other executives, of hiding information
about the company's finances from the public. According to the
lawsuit, executives' action caused the retirees to lose money
when the value of the company's stock later fell.
ConAgra spokesman Chris Kircher told The Associated Press that
he had not seen the lawsuit and could not comment specifically.
"But it appears to be driven by the same logic" as the other two
lawsuits, he said. "Class action attorneys jumping on the same
bandwagon. We believe it has no merit, and we will fight."
DAN NELSON: SD AG To Help Customers of Closed Car Dealership
------------------------------------------------------------
South Dakota Attorney General Larry Long and Revenue and
Regulation Secretary Gary Viken want to remind consumers that
help is available for Dan Nelson customers. The recent closing
of the Dan Nelson Automotive dealerships in Sioux Falls and
Rapid City has caused some concern among buyers.
"My Consumer Protection Division assists dozens of consumers
with a variety of issues," said Mr. Long, "and we stand ready to
assist consumers with concerns about Dan Nelson Automotive.
Consumer Investigators mediated complaints prior to the closure
and will continue to do so."
"The Motor Vehicle Division will assist consumers with title
issues; however, there may be situations where it will be
necessary for consumers to seek legal counsel, depending upon
the circumstance," said Motor Vehicle Division Director Deb
Hillmer.
Mr. Long said that his office and the Department of Revenue are
also working with MetaBank to resolve issues as they arise in
connection with the closure of the Dan Nelson Automotive
dealerships. Consumers who have questions or complaints can
contact the Consumer Protection Division by Phone:
1-800-300-1986 or the Motor Vehicle Division by Phone:
605-773-3541 or visit the Website:
http://www.state.sd.us/attorney.
ELECTRICAL CARBON: Suit Settlement Hearing Set November 10, 2005
----------------------------------------------------------------
The United States District Court for the District of New Jersey
will hold a fairness hearing in the proposed $24.2 million
settlement for the matter: In re Electrical Carbon Products
Antitrust Litigation, MDL No. 1514, Master Civil No. 03-2182
(JBS), on behalf of all persons who purchased Electrical Carbon
Products in the United States from a facility located in the
United States, directly from the defendants during the period
January 1, 1990 through December 31, 1999.
The hearing will be held on November 10, 2005, at 10:00 p.m., at
the Mitchell H. Cohen U.S. Courthouse, Fourth and Cooper
Streets, Camden, NJ, 08101.
For more details, contact Steven A. Asher of Weinstein
Kitchenoff & Asher LLC, 1845 Walnut St., Suite 1100,
Philadelphia, PA, 19103, Phone: 215-545-7200 or 877-805-7200,
Fax: 215 545 6535, E-mail: asher@wka-law.com OR Melissa H.
Maxman, Esq. of Duanne Morris LLP, 101 W. Broadway, Ste 900, San
Diego, CA, 92101, Phone: (619) 744-2200, Fax: (619) 744-2201 OR
visit http://www.hrsclaimsadministration.com/cases/ecp/.
ENRON CORPORATION: WA To Participate in $1.52B Multistate Pact
--------------------------------------------------------------
Washington Attorney General Rob McKenna announced a $1.52
billion multistate settlement with Enron to resolve some of the
claims of market manipulation and price gouging stemming from
the energy shortage of 2000-2001, in a statement dated July
15,2005.
The states of Washington, California and Oregon, as well as some
California utilities and other organizations, are parties to the
settlement. The agreement must be approved by the Federal Energy
Regulatory Commission (FERC) and the Enron bankruptcy court.
"Enron used malicious tactics to illegally manipulate the energy
market and get rich at the expense of Washington utility
companies and residents," Mr. McKenna said. "This settlement is
a bittersweet victory because although the penalties are
significant, litigation almost always brings incomplete recovery
and, as a result of Enron's bankruptcy, we'll likely see only
pennies on the dollar."
Enron traders engaged in numerous incidents of unlawful conduct
in Washington State, Mr. McKenna said. During the 2000-2001
energy crisis, the company overcharged Washington utilities by
millions of dollars for wholesale electricity, resulting in
utility rate increases passed along to consumers.
The proposed settlement resolves certain claims now pending
before FERC and in the Enron bankruptcy. It does not resolve all
claims rising from Enron's behavior in the energy crisis - such
as litigation involving a contract termination claim involving
Enron and the Snohomish Public Utility District - nor does it
prevent the state from pursuing criminal charges against Enron.
Under this settlement, Washington and Oregon each receive more
than $22 million in unsecured bankruptcy claims. However, the
amount ultimately paid by Enron under the settlement will not be
known until the bankruptcy court decides on a distribution
amount and schedule, which could take a year or more. Attorneys
anticipate the final amount actually received by Washington will
be just a few million dollars.
Prior to declaring bankruptcy, Enron was reportedly the largest
wholesale power marketer in North America by sales volume, and
made nearly $2 billion in profits during from its electricity
trading operations in the Western states during 2000 and 2001.
The attorneys allege that Enron traders manipulated the energy
market with schemes dubbed with such colorful names as "Death
Star," "Fat Boy," "Get Shorty," "Ricochet," and "Load Shift."
The "Fat Boy" scam, for example, involved "overscheduling" power
transmission to a company subsidiary that didn't really need all
of it. Then Enron would sell the "excess" power to the state at
a premium. With "Ricochet," Enron bought power cheaply from
California, sold it to an intermediary in another state, then
sold it back to California at an inflated price. In addition,
the company engaged in "wash trades" to manipulate index prices
and falsely create the appearance of higher volume trading,
thereby boosting their credit and stock status.
The Washington State Attorney General's Office previously
settled with three other companies for their roles in the 2000-
2001 energy crisis. El Paso Corp. paid Washington $23 million.
Williams Companies, Inc. and the Williams Energy Marketing and
Trading Company settled for $15 million. Duke Energy Company
paid $3.25 million.
For more information, contact Kristin Alexander, Public
Information Officer, Attorney General's Office, by Phone:
(206) 464-6432 or visit the Website: http://www.atg.wa.gov/.
ESPEED INC.: Individual Investors Achieve Lead Plaintiff Status
---------------------------------------------------------------
Southern District Judge Shira Scheindlin took the unusual step
of selecting a small group of individual investors, rather than
an institutional investor, as presumptive lead plaintiff in a
securities class action suit against the financial software
company, eSpeed, Inc. (NASDAQ: ESPD), The New York Law Journal
reports.
Both the Greater Pennsylvania Carpenters Pension Fund and a
group of five investors led by Shabbir Adib sought to be named
lead plaintiff in a suit against the New York-based firm. In
the case, In Re eSpeed, Inc. Securities Litigation, 05 Civ.
2091, the judge acknowledged that the standards established in
the 1995 Private Securities Litigation Reform Act were designed
to favor pension funds and other institutional investors in
selecting lead plaintiffs.
Additionally, Judge Scheindlin wrote in her ruling, "Appointing
a group of unrelated investors lead plaintiff could lead to
fragmentation and the problem of determining whose voice reigns
when the group cannot agree. An institutional investor with
substantial losses functioning as lead plaintiff is less likely
to cause a 'flurry of otherwise pointless activity' in the form
of disputes within the lead plaintiff group."
However, Judge Scheindlin noted that, while courts in the
Southern District were divided as to whether a group of
unrelated investors, could serve as lead plaintiff, the majority
view was that such a group can serve in that role in the
appropriate circumstances. To that end, she wrote, "Where
aggregation would not displace an institutional investor as
presumptive lead plaintiff based on the amount of losses
sustained, a small group of unrelated investors may serve as
lead plaintiff."
Judge Scheindlin wrote that the contest for presumptive lead
plaintiff hinged on whether the Adib group had larger losses
than the pension fund.
Two of the four factors used in determining which plaintiff had
the greatest financial interest in the outcome of the
litigation, which include net number of shares purchased during
the class period and the total net funds expended, favored the
Adib group, Judge Scheindlin wrote. She further wrote that a
third factor, the number of gross shares purchased during the
class period, favored the pension fund, while the fourth factor
required a measurement of the parties' financial losses.
The pension fund applied the First-In, First-Out accounting
method while the Adib group applied the Last-In, Last-Out method
to make this calculation. The methods, often called by their
acronyms, FIFO and LIFO, are normally used in the accounting
world to calculate the value of inventory. Courts though have
used both methods in determining loss valuation.
The judge stated, "The main advantage of LIFO is that, unlike
FIFO, it takes into account gains that might have accrued to
plaintiffs during the class period due to the inflation of a
stock price."
The plaintiffs had accused eSpeed of inflating its stock price
by hiding negative information about the company's prospects.
But, Judge Scheindlin held, "FIFO, as applied by the Pension
Fund ignores sales occurring during the class period and hence
may exaggerate losses." If plaintiffs had sold some eSpeed
stock during the class period when this alleged deception took
place, then they would have profited from the inflated price.
Referring to LIFO Judge Scheindlin wrote, "Because this method
contemplates the offsetting gains the parties collected during
the class period, it is a better measurement of the true damages
sustained by the plaintiffs."
As it turned out, the pension fund had sold some of its eSpeed
shares during the class period at a significantly higher price
than the price after eSpeed's disclosure of its true financial
condition.
"Thus the Pension Fund's losses due to eSpeed's alleged fraud
were actually somewhat cushioned by the sales made when eSpeed's
stock price was high, sales that are not taken into account by
the Pension Fund's application of FIFO," Judge Scheindlin held.
She continued, "By contrast the Adib Group's utilization of LIFO
reflects offsetting 'gains' that were attained through the sale
of stock during the class period."
On that basis, the judge calculated that Adib group lost either
$166,743 or $196,795, while the pension fund lost $121,264 and
since the group otherwise met the requirements of federal rules
for a lead plaintiff, she also granted it the status of
presumptive lead plaintiff.
The suit is styled, In Re eSpeed, Inc. Securities Litigation, 05
Civ. 2091, which is pending the United States District Court for
the Southern District of New York, before the Honorable Shira
Scheindlin. Laurence Paskowitz of Paskowitz & Associates
represented the Adib group. Samuel Rudman of Lerach Coughlin
Stoia Geller Rudman & Robin acted as plaintiffs' counsel. Lionel
Glancy of Glancy Binkow & Goldberg in Los Angeles acted as
plaintiffs' counsel. Eric Belfi of Murray, Frank & Sailer acted
as plaintiffs' counsel. Dennis Orr and Joseph De Simone of
Mayer, Brown, Rowe & Maw's New York office represented eSpeed.
FLORIDA: AG Crist Files Suit V. Three Firms For Medicaid Fraud
--------------------------------------------------------------
Florida Attorney General Charlie Crist filed suit against three
pharmaceutical manufacturers for defrauding Florida's Medicaid
program in a scheme that cost Florida taxpayers $25 million.
The lawsuit alleges that the companies wrongfully inflated
prices in a way that let pharmacies receive excessive
reimbursement for filling prescriptions for Medicaid patients
who bought generic drugs for depression, schizophrenia,
seizures, angina and other serious illnesses.
An investigation by the Attorney General's Medicaid Fraud
Control Unit revealed that the three companies - Mylan
Pharmaceuticals, Inc., Teva Pharmaceutical Industries, Ltd., and
Watson Pharmaceuticals, Inc. - and various parent and subsidiary
companies enabled Medicaid pharmacies to obtain reimbursements
that far exceeded the actual cost of the drugs. The
manufacturers then used this potential windfall as a marketing
tool, telling pharmacies they could make more money in Medicaid
reimbursements if they sold the companies' products rather than
those of their competitors. The fraudulent practices began as
early as 1994 and allegedly resulted in hundreds of thousands of
false claims. The lawsuit was prompted by a whistle-blower
lawsuit filed by a small Key West pharmacy.
"These companies ripped off Florida's Medicaid program and
cheated the public," Mr. Crist said. "They profited by helping
pharmacies line their pockets with Medicaid money that was
supposed to help needy Floridians obtain medicine and health
care."
Like most Medicaid programs around the country, the Florida
program reimburses pharmacies, physicians and other medical
providers for the drugs they dispense to Medicaid patients. The
reimbursements are based on the drugs' "average wholesale
prices," which the manufacturers are required to accurately
report. If manufacturers report inflated prices to the Medicaid
program, the bogus amounts can cause the taxpayer-supported
program to overpay for medications. The result of this scheme is
that the manufacturers sell more of their products, pharmacies
receive excessive reimbursement and the taxpayers pay more than
they should, thereby depleting limited Medicaid resources.
The lawsuit marks the third case of its kind Mr. Crist has
brought against drug manufacturers for defrauding Medicaid and
Florida taxpayers. Mr. Crist brought similar allegations against
three pharmaceutical manufacturers in July 2003, and filed a
second lawsuit against an additional three companies in April
2005. Today's lawsuit alleges violations of the Florida False
Claims Act and common law fraud. The False Claims Act authorizes
triple damages, increasing the state's potential recovery to $75
million.
For more details, contact the Attorney General by Mail: The
Capitol PL-01, Tallahassee, FL 32399-1050 by Phone: 850-414-3300
or 1-866-966-7226 or view the civil complaint at this Website:
http://myfloridalegal.com/webfiles.nsf/WF/MRAY-
6EFRYC/$file/AWP_Complaint.pdf.
HSBC USA: Call Center Employees Launch Overtime Wage Suit in NY
---------------------------------------------------------------
Global banking firm HSBC USA, Inc. (NYSE: HBC) violated federal
and state labor laws, according to a lawsuit filed recently in
New York federal court.
Two former telephone call center workers in HSBC facilities in
the Buffalo, N.Y. area -- James Stefaniak and Keith Panaccione -
- allege that neither they nor their coworkers received overtime
pay as required by federal Fair Labor Standards Act ("FLSA") and
New York state laws.
Attorneys from Outten & Golden LLP and Stueve Siegel Hanson
Woody LLP represent the call center workers and will seek
certification of the case as a class action that could include
thousands of current and former workers at HSBC call center
facilities in Buffalo, N.Y.; Depew, N.Y.; Chesapeake, Va.; Wood
Dale, Ill.; Las Vegas, Nev.; and other locations.
According to Mr. Panaccione, "Like many employees at the call
center, I came in early and left late, but was only paid for
scheduled shifts. In my case, it was one to two extra hours per
week, on average, that I gave the company without overtime
compensation. That adds up over time."
Attorney George A. Hanson, of Stueve Siegel Hanson Woody's
Kansas City, Mo., office, stated, "The law requires that
employers properly record work performed and pay workers for all
of the time that they work, not just for their scheduled shifts.
Unfortunately, this practice is common to call centers across
the country."
Justin M. Swartz, an attorney with Outten & Golden's New York
City office, stated, "Call center employees work in high-stress,
low-pay jobs. Ensuring that workers got paid for all of their
well-done should be a top priority of all call center operators
such as HSBC." He added that the law firms' investigation of
overtime practices involves call centers throughout the nation.
The suit is styled, "James Stefaniak and Keith Panaccione v.
HSBC Bank USA Inc.," (No. 05 CV 6528) in the U.S. District Court
for the Southern District of New York.
For more details, contact Justin M. Swartz or Tammy Marzigliano
of Outten & Golden LLP, Phone: (877) 468-8836, E-mail:
jms@outtengolden.com or tm@outtengolden.com, Web site:
http://www.outtengolden.comOR George A. Hanson or Amy E. Bauman
of STUEVE SIEGEL HANSON WOODY, LLP, Phone: (800) 714-0360, E-
mail: hanson@sshwlaw.com or bauman@sshwlaw.com, Web site:
http://www.sshwlaw.com.
KANSAS: Vietnamese Group Sues Wichita Diocese Over Money Shift
--------------------------------------------------------------
A lawsuit seeking class action status was launched in Sedgwick
County District Court against the Catholic Diocese of Wichita,
which alleges that it illegally transferred more than $400,000
from a Vietnamese Catholic group's fund into a church account,
The Wichita Eagle reports. Defendants named in the suit include
the Catholic Diocese of Wichita and the Rev. Hung Quoc Pham,
pastor of St. Anthony's Catholic Church, 256 N. Ohio.
However, according to the lawyer and spokeswoman for the
diocese, it did only what members of the Vietnamese Catholic
community asked it to do. The lawyer also pointed out that the
money is in diocesan accounts for the Vietnamese Cultural
Center, St. Anthony's Catholic Church and Vietnamese Catholics.
The suit was filed in April by Wichitan Thai Hong Mai, who is
identified in the lawsuit as a member of a group called the
Vietnamese Catholic Community in Wichita, Kansas. The group was
formed in 1980 to help Vietnamese Catholics protect and develop
Vietnamese culture and support the Catholic Church.
According to the suit, in February 2003, then-Bishop Thomas
Olmsted issued a statement saying that the group's funds would
be placed into St. Anthony Church's account and administered
according to diocesan policy and regulations. The group, which
had about $420,000 in assets at the time, also indicated in the
suit that in May 2003, members of the group's governing board
voted to dissolve the group and later to transfer the
community's funds to the church account.
Lee Thompson, lawyer for Mr. Mai, told The Wichita Eagle that
any decision of what to do with the funds required the vote of
all members of the group, not just the board, since it was an
unincorporated organization. He pointed out, "A committee, which
acted only after the bishop announced what he was going to do,
did not legally have the authority to make these decisions."
However, Karl Hesse, lawyer for the diocese, told The Wichita
Eagle that Bishop Olmsted issued his statement only after
members of the Vietnamese Catholic community came to him and
asked that the diocese take over the funds. Mr. Hesse also
stated that members expressed concern over mismanagement of the
funds. "They said, 'We just want it off our plate,' " Mr. Hesse
adds.
Additionally, Mr. Hesse pointed out that an audit was done, and
the governing board and other group leaders voted to dissolve
the group and transfer the funds, thus after the decision was
made the funds were moved into the St. Anthony's account and
into a diocesan account for Vietnamese Catholics. He also
pointed out that the group's 22 leaders were within their rights
when they voted, since it was unclear who comprised the total
membership of the group. "They did what made the most sense,
given how they had run this group," he states.
In July 2003, Bishop Olmsted issued a letter agreeing with the
group's decision and recommended that half the funds be
deposited in St. Anthony's account at the chancery and half be
put into an account for the Interim Vietnamese Diocesan Pastoral
Council to support its activities in service to the Vietnamese
Catholic community. The funds were placed in those two accounts,
Mr. Hesse said.
The diocese is in the process of renovating St. Anthony's
Catholic Church, but none of the funds used in that project have
come from the Vietnamese group's account, according to Amy
Pavlacka, director of communication for the diocese.
LOUISIANA: French Quarter Residents File Parking Meter Suit
-----------------------------------------------------------
Residents at Louisiana's French Quarter filed a lawsuit
disputing the installation of the new plastic parking meters,
alleging that they did not meet the aesthetic requirements of
the Vieux Carre, The Times Picayune reports.
In a recent news conference wherein they plead their case in the
court of public opinion, the residents stated that they have
added in their complaint that not only are the city's new
parking meters ugly, but they have also been causing drivers to
be fined illegally.
Stuart H. Smith, the lead plaintiff and a local lawyer stated at
the news conference that the city should meet with residents "to
determine where people want these meters and where they don't --
we don't want them in the French Quarter." The amended lawsuit
also seeks class action status on behalf of all city residents,
Mr. Smith adds. The case was recently assigned to Civil District
Court Judge Rosemary Ledet.
Mr. Smith told Times Picayune that the Vieux Carre residents are
not the only ones who believe the bulky green meters interfere
with the ambiance of their neighborhoods stating that he has
gotten similar complaints from residents of Magazine Street and
the Garden District. According to him, the City Planning
Commission, the City Council and the Vieux Carre Commission
installed the meters this year without notice to the public or
review, procedures that he claims are legally required.
In addition, he told Times Picayune that according to city law,
tickets can be written only when an expired, mechanical meter
displays a yellow or red flag. Since the new meters do not
display these signals, tickets issued to motorists are illegal,
he said. The new meters issue a paper receipt that drivers
display on their dashboards, showing when their paid parking
time expires.
Mr. Smith also stated that he does not know how many tickets
have been written during the past seven months or the amount of
fines involved, but he intends to get this information. He adds
that the amended lawsuit also names a new defendant, the
national company ACS State and Local Solutions Inc., both of
whom were hired by the city to collect the parking fines. The
new solar-powered parking meters, which take credit cards, as
well as coins, replaced many of the old meters. Mayor Ray Nagin
installed the new meters "unilaterally", the suit says.
Mr. Smith told Times Picayune that he was not aware of a case
pending in federal court before U.S. District Judge Thomas
Porteous. In that case, WorldWide Parking, one of the losing
bidders for the parking meter contract, has challenged the
city's decision to treat the contract award as a professional
service, meaning that the job did not have to go to the lowest
bidder. The job was awarded to Parking Solutions LLC and
Standard Parking Corp., and Mr. Smith's suit contends that both
companies had "political ties" to the city.
To reinforce his case that the city did not properly notify
residents, Mr. Smith pointed to City Councilwoman Jacquelyn
Brechtel Clarkson's proposal to legalize the green meters
retroactively. He stated that her proposed ordinance also would
delete the requirement that residential property owners be
notified of the city's intention to install new meters.
The ordinance was scheduled for consideration soon, but the City
Council's meeting has been postponed until July 28. A summary of
her proposal on the council's Web site said that the ordinance
would provide for the use of multi-space pay stations to
regulate on-street parking, ratify the installation of such
devices already in place, and provide for the enforcement of
citations for parking violations issued in connection with these
meters.
MICHELIN: Refund Offer Not Likely To Please US Grand Prix Fans
--------------------------------------------------------------
Some customers are still disgruntled about the US Grand Prix,
despite tiremaker Michelin's offer to refund their tickets, 24
Hour News 8 reports.
14 out of 20 cars participating in the Grand Prix refused to
race after Michelin earlier told its partners that racing was
unsafe after they failed to find out what had caused two crashes
in practice at the Indianapolis Motor Speedway, an earlier Class
Action Reporter story (June 23,2005) reports.
After the debacle, Michelin offered to refund money to those who
bought race tickets and buy 20,000 tickets for those wanting to
return for the 2006 race. Michelin is spending $10 million to
try to make things right. "At this point, what we'd like to do
is just move forward. Let's look forward. Let's do everything in
our power to return Grand Prix racing to Indianapolis," Michael
Fanning, Michelin, told 24 Hour News 8.
The speedway told 24 Hour News 8 the vast majority of the fans
bought their tickets through the administration office, and
their names are on file with the track. Those fans will receive
details by mail on how to get their money back, but they won't
need to send in any forms. Spectators who bought tickets at the
gate will need to send-in their stubs, along with a refund form
which will be available next month.
However, some fans think the offer was not enough. Five class
actions have already been filed in Indianapolis. "That's what's
left unanswered, who is going to pay the rest of the damages
that these people suffered, in order to do what Michelin wants
to do, which is to re-establish Grand Prix in Indianapolis as a
valid and viable spectator event?" Henry Price, one of the
attorneys filing suit, told 24 Hour News.
Price says fans spent their money for more than just a ticket to
one race. "A thousand dollars for travel on the average, a
thousand dollars for three or four days of hotel, a hundred
dollars a day for food, fifty dollars a day for parking, put all
that together, and you have $240-300 million," he said. Mr.
Price thinks $10 million is mere pocket change for the people
behind the richest racing league in the world.
MICHIGAN: Grosse Point Park Losses Lawsuit Over Flood Insurance
---------------------------------------------------------------
A decade after city officials first got in hot water for
flooding homes in Detroit, Grosse Pointe Park learned that its
former insurance company wouldn't have to pay for the mishap,
The Detroit News reports.
According to a recent ruling by the state's Supreme Court, the
Michigan Municipal Liability and Property Pool does not owe
Grosse Pointe Park the $1.9 million it paid to settle with angry
homeowners in 1997. After the ruling was handed down, Herold
Deason, city attorney for Grosse Pointe Park told The Detroit
News, "We are obviously disappointed the court didn't see it our
way. The city could have used the money."
The problem began with a longstanding policy Grosse Pointe Park
had of dumping sewage into Fox Creek, which straddles Detroit,
when its sewage system was strained, typically during heavy
rains. On July 24, 1995, Grosse Pointe Park sent overflow rain
and sewage into the creek. Two months later, homeowners whose
yards and basements were ruined launched a class action suit for
flooding damages. Since 1940, the city had dumped overflow
waste into the creek and has continued to do so until 1995.
Grosse Pointe Park used to have a single pipeline that pumped
rain and sewage to the city of Detroit's nearby filtering plant.
Under the city's insurance policy, Michigan Municipal Liability
would cover claims of sewage-backup damage to residents and
businesses because of system failures. However, the city's
decision to intentionally direct overflow sewage into the creek
was simply pollution, not system failure, the insurer maintained
and because of that, it refused to cover the city.
In two 26-page opinions, the Supreme Court unanimously agreed to
the insurers arguments. Justice Robert Young writing on behalf
of the court, "It is difficult to imagine an insurance policy
that is clearer or more explicit."
The city had paid the 1997 settlement with the residents and
then sued its insurer. Wayne County Circuit Judge Amy Hathaway
sided with the city, saying the insurance company had always
paid damage claims before. But, the Supreme Court said that
didn't prevent Michigan Municipal Liability from balking this
time. As part of the August 1997 settlement with the
homeowners, Grosse Pointe Park now has separate sewer and
rainwater lines and no longer dumps into Fox Creek. That
settlement required Grosse Pointe Park and the city of Detroit
to each pay $1.9 million to residents whose homes were flooded.
Michigan Municipal Liability is a self-insurance operation
involving several municipalities who pool their money. Grosse
Pointe Park has not used the insurer since 1998.
OHIO: OHCA Launches Suit Over Biennial Budget Bill's Provisions
---------------------------------------------------------------
Ohio's largest organization representing long-term care
providers commenced a class action lawsuit against the Ohio
Department of Job and Family Services (ODJFS) and the Ohio
Department of Health. The lawsuit by the Ohio Health Care
Association (OHCA) and several association members asserts that
provisions of the recently passed biennial budget bill violate
federal and state law.
"We must stand up for our members and protest some of the things
that the budget bill does," said Peter Van Runkle, OHCA's
President and Chief Executive Officer. "There are provisions in
the bill that inappropriately penalize people who are trying to
provide quality care to Ohio's seniors," he added.
The suit (Ohio Health Care Association, et al. v. Barbara Riley,
Director, et al), which was filed in the Franklin County Court
of Common Pleas, takes aim at a new formula for Medicaid
payments to nursing homes being implemented by ODJFS. "The new
price-based system does not take adequate account of capital
expenditures that providers need to make so residents can have
safe, pleasant living environments and to comply with ever-
increasing building regulations," said Mr. Van Runkle. OHCA's
lawsuit points out that the state did not follow the
requirements of federal law when it adopted the new pricing
system.
"Our members didn't have an opportunity for input into this new
formula before it was put in place, as the federal law
mandates," Mr. Van Runkle said. "The way the pricing system
deals with capital costs is not best for Ohio's seniors and
should be changed." He noted that OHCA is generally supportive
of other aspects of the pricing system and believes it should be
implemented even more quickly than the budget bill provides.
The association's suit also challenges provisions in the budget
bill that penalize providers who are in the process of replacing
or upgrading aging nursing homes. "These people made long-term
financial commitments in good faith, based on a set of rules
that have been in place for many years. The rug has been pulled
out from under them, and that needs to be fixed," said Mr. Van
Runkle.
The association's complaint asks the court to declare the
offending sections of the budget bill to be invalid and to
enjoin ODJFS from enforcing them. The complaint also asks the
court to order ODJFS to pay for new or renovated nursing homes
under the law in effect when the projects began. A copy of the
lawsuit is available at
www.ohca.org/uploads/news/lawsuit7-20-05.pdf.
OHIO: Presiding Judge OKs $120M Fund For Priest Abuse Victims
-------------------------------------------------------------
Special Judge John Potter of Louisville, who is presiding over
the nation's only class action suit alleging sexual abuse by
priests, recently gave his approval of the settlement agreement
in writing, The Cincinnati.com reports. The judge's action was
the catalyst that the Covington Diocese and lawyers for sexual
abuse victims were waiting for before they start the process to
compensate victims.
Under the settlement an advertisement announcing the much-touted
settlement plan will be published in USA Today on July 21. That
advertisement will be followed with the same announcement in
newspapers across Kentucky, including the Kentucky Enquirer. In
addition, there will be radio and television spots for the
settlement. The advertising blitz is to inform potential victims
of the settlement fund. Anyone choosing to submit a claim to the
fund will be required to submit a confidential form by November
10. Objections to the compensation fund must be submitted to the
court in writing by December 19. A hearing on whether the
proposed settlement is fair is set for January 9, 2006, in the
Boone County Justice Center.
The settlement fund will immediately include $40 million
provided by the diocese. The remaining $80 million was to be
provided by the diocese's insurance carriers. Recently, the
diocese filed suit in federal court in an attempt to force them
to contribute the amount to the $120 million compensation fund.
Additionally, the settlement calls for a special administrator
to evaluate the claims and pay the money. That administrator
will be asked to divide claims based on the severity and type of
abuse, thus settlements would range from $5,000 to $450,000.
There is a special clause in the agreement that says people with
the most severe abuse can ask for up to an additional $550,000 -
meaning the most any one person could receive is $1 million.
Both the diocese and plaintiff's attorneys must agree with the
administrator for any additional money to be awarded. Any money
not paid out in claims will be given back to the diocese.
The class action lawsuit, as previously reported in the February
18, 2003 edition of the Class Action Reporter, was filed in
Boone County Circuit Court by Cincinnati-based attorney Stan
Chesley, claims that 21 priests and some other workers abused
more than 150 victims in the Diocese of Covington for decades
while church officials did nothing to stop the misconduct.
According to the court filings, from about 1956, information on
the sexual abuse of minors by diocesan priests has been
concealed from the public, including parents of children in
schools and parishes where the alleged perpetrators were
assigned, as well as from family members of employees of the
diocese. Specifically, the suit accuses the diocese, which is
just across the Ohio River from Cincinnati, of a 50-year cover-
up of sexual abuse by priests and others.
PEPSI BOTTLING: Receives $24M Share in Corn Syrup Antitrust Pact
----------------------------------------------------------------
Pepsi Bottling Group, Inc. received a total of $24 million as
its share in the settlement proceeds attributable to its current
bottling operations previously owned by PepsiCo, in the
antitrust class action filed against three of the Company's
suppliers on the sale of high fructose corn syrup from 1991 and
1995.
About 20 corn syrup buyers initially filed the suit in the
United States District Court for the Central District of
Illinois against several corn processors, alleging that they
violated antitrust laws from 1988 to 1995 by conspiring to
artificially inflate the price of high fructose corn syrup.
About 2,000 plaintiffs joined the suit, including Coca-Cola Co.,
PepsiCo Inc., Kraft Foods Inc. and Quaker Oats, an earlier Class
Action Reporter story (July 30,2004) states.
In July 2004, the parties in the suit forged a $531 million
settlement for the suit. The settlement amount was allocated to
each class action recipient based on the proportion of its
purchases of high fructose corn syrup from these suppliers
during the period 1991 through 1995 to the total of such
purchases by all class action recipients.
From 1991 to 1995, the Company was still part of PepsiCo. On
June 28, 2005, the Company and PepsiCo entered into a settlement
agreement under which the Company will receive 45.8% of the
settlement proceeds attributable to current PBG bottling
operations that were previously owned by PepsiCo (the "PepsiCo
Recovery"). Subsequent to the end of the second quarter, the
court overseeing the lawsuit approved payment of 90% of claim
awards, including the PepsiCo Recovery. In connection with this
partial payment of the PepsiCo Recovery and in accordance with
the Company's agreement with PepsiCo, the Company received $21
million. The Company also received an additional $3 million as
a result of certain other claims it had submitted, which are
unrelated to the bottling operations previously owned by
PepsiCo. These amounts will be recognized in the third quarter
of 2005. The Company currently intends to utilize settlement
proceeds to fund long-term, strategic productivity initiatives,
it disclosed in a filing with the Securities and Exchange
Commission.
The suit is styled "In Re High Fructose Corn Syrup Antitrust
Litigation, Master File No. 95-1477," filed in the United States
District court for the Central District of Illinois, Peoria
Division. Representing the plaintiffs were:
(1) Mr. Michael J. Freed of Much Shelist Freed Denenberg
Ament Bell & Rubenstein, P.C., 200 N. LaSalle Street,
Suite 2100 Chicago, IL 60601-1095
(2) Mr. Robert N. Kaplan, Kaplan, Kilsheimer & Fox, LLP
805 Third Avenue, New York, NY 10022
(3) Mr. H. Laddie Montague, Jr., Berger & Montague, P.C.
1622 Locust Street, Philadelphia, PA 19103-6365
PIZZA HUT: CA Court Strikes Certain Class Members From FLSA Suit
----------------------------------------------------------------
The United States District Court for the District of California
granted Pizza Hut, Inc.'s motion to strike certain members of
the class in the lawsuit filed against it, alleging violations
of the United States Fair Labor Standards Act (FLSA).
The suit, entitled "Coldiron v. Pizza Hut, Inc.," was filed on
August 13, 2003, alleging that the Company's current and former
Pizza Hut Restaurant General Managers (RGMs) were improperly
classified as exempt employees. There is also a pendent state
law claim, alleging that current and former RGMs in California
were misclassified under that state's law. Plaintiff seeks
unpaid overtime wages and penalties.
On May 5, 2004, the District Court granted conditional
certification of a nationwide class of RGMs under the FLSA
claim, providing notice to prospective class members and an
opportunity to join the class. Approximately 12 percent of the
eligible class members have joined the litigation as of June 29,
2005 (although a number were later stricken by the District
Court, as described below). Once class certification discovery
is completed, the Company intends to challenge the propriety of
conditional class certification.
On July 20, 2004, the District Court granted summary judgment on
Ms. Coldiron's individual FLSA claim. The Company believes that
the District Court's summary judgment ruling in favor of Ms.
Coldiron is clearly erroneous under well-established legal
precedent. Ms. Coldiron also filed a motion to certify an
additional class of current and former California RGMs under
California state law, a motion for summary judgment on her
individual state law claims and a motion requesting that the
District Court enter summary judgment on the damages that FLSA
class members would be due upon successful prosecution of the
class-wide litigation. The Company opposed all three motions.
On April 1, 2005, the District Court issued an order granting
Ms. Coldiron's motion to certify a California state law class.
On April 15, 2005, the Company filed a petition for review of
that order by the United States Court of Appeals for the Ninth
Circuit. On May 5, 2005, the District Court sua sponte filed an
order extending the opt-in cut-off date in the FLSA action until
September 1, 2005. On May 13, 2005, the District Court sua
sponte amended its April 1, 2005 order to identify the
California class claims and appoint class counsel. On May 27,
2005, the Company filed a petition for review of the amended
order by the Ninth Circuit. The Ninth Circuit has not yet ruled
on either petition.
On June 30, 2005, the District Court granted the Company's
motion to strike all FLSA class members who joined the
litigation after July 15, 2004. The effect of this order is to
reduce the number of FLSA class members to only approximately 87
(or approximately 2.5% of the eligible class members).
The suit is styled "Ann Coldiron v. Pizza Hut Inc., et al., case
no. 2:03-cv-05865-TJH-Mc," filed in the United States District
Court for the Central District of California under Judge Terry
J. Hatter.
Representing the plaintiffs are Bicvan T. Brown, Rex Hwang,
Justian Jusuf, Gregory G. Petersen, and H. Ernie Nishii of
Castle Petersen and Krause, 4675 MacArthur Court, Suite 1250
Newport Beach, CA 92660, Phone: 949-417-5600, E-mail:
justian@cpk-law.com; and Catherine Starr of Catherine Starr Law
Offices, 24325 Crenshaw Blvd, Suite 211, Torrance, CA 90505
Phone: 310-539-4806, Fax: 310-539-2454.
Representing the Company are:
(1) Andra Barmash Greene, Layn R. Phillips, Henry Shields,
Jr. and Bruce A. Wessell, Irell & Manella, 1800 Avenue
of the Stars, Suite 900, Los Angeles, CA 90067-4276,
Phone: 310-277-1010, fax: 310-203-7199, E-mail:
lphillips@irell.com, hshields@irell.com or
bwessell@irell.com
(2) George A McNamee, III, Richard S. Ruben, Ellen Laguerta
Uy, Paula Maxine Weber, Pillsbury Winthrop, 725 S
Figueroa St, Ste 2800, Los Angeles, CA 90017-5406,
Phone: 213-488-7100
PRB CONTRACTING: VT AG Initiates Home Improvement Fraud Lawsuit
---------------------------------------------------------------
Vermont Attorney General William H. Sorrell's Office filed a
complaint against Paul Beaulieu of Essex, Vermont with seven
counts of home improvement fraud.
The charges allege that between June of 2003 and December of
2004, Mr. Beaulieu, doing business as either Articulate Painting
and Contracting or PRB Contracting engaged in a pattern and
practice of entering into agreements with homeowners to perform
home improvement projects, collected substantial payments toward
the work and then either did not start or complete the work.
The Vermont Attorney General's Office is continuing its
investigation into Mr. Beaulieu's contracting activities. For
more details, contact Attorney General Investigator Thomas
Howell by Phone: (802) 828-5512 or Craig Matanle, Assistant
Attorney General, by Mail: 109 State Street, Montpelier VT
05609-1001, by Phone: (802) 828-3171, by Fax: (802) 828-5341 or
visit the Website: http://www.state.vt.us/atg/
SOUTH DAKOTA: AG To Give Share in Taxol Settlement To Charities
---------------------------------------------------------------
As the result of an antitrust settlement with the drug Taxol,
the South Dakota Attorney General Larry Long's Office has been
awarded $12,476.70 for distribution to a nonprofit charitable
organization, which provides services, benefits and assistance
to cancer patients and their families.
The settlement money will be distributed to the Rapid City
Regional Hospital's Cancer Care Institute. The money will be
used to provide financial assistance to cancer patients and
their families to cover costs of accommodations, transportation
and food needs of patients and family members who travel to
Rapid City Regional for cancer treatment. These types of
expenses are typically not covered by insurance or health care
coverage plans.
"This settlement effectively allows us to give the money right
back to the cancer victims and their families," said Mr. Long.
"We hope that this settlement money will help offset some of the
costs accrued while traveling for cancer treatment."
For additional information about the settlement, contact Sara
Rabern by Phone: 605-773-3215 or Rapid City Regional's Public
Relations Office by Phone: 605-719-7514 for more information
about the Cancer Care Institute, or visit the Website:
http://www.state.sd.us/attorney.
TXU ELECTRIC: Rusk City Accepts Share Ratepayer Suit Settlement
---------------------------------------------------------------
The Rusk City Council in Texas agreed to accept money from TXU
Electric Delivery as part of a settlement of litigation,
regarding justification of TXU rates, the Jacksonville Daily
Progress reports.
Several customer cities in Texas, not including Rusk, filed a
lawsuit against the Company. TXU Spokesperson Carol Peters said
in an earlier interview with the Daily Progress, agreements were
reached with the customer cities to settle litigation against
the company, but settlement money was to be distributed to more
than just the approximate 20 cities that filed suits. She said
the settlement offered to Rusk and other cities not involved in
the original litigation is being made "in good faith" as an
incentive to not initiate further litigation concerning TXU
Electric Delivery's rates prior to July 1, 2006.
The council members voted unanimously to accept the settlement.
"There was a class action suit we did not participate in, but
we'll benefit from," Rusk Mayor Suzann McCarty told the Daily
Progress.
The city of Rusk will receive $18,175.52 this year, and another
payment of $17,309.54 will be made by TXU in March 2006.
Councilmember Don Jones asked how long the company would make
the payments to the city of Rusk.
"If we initiate any legal action (or) ... intervene in any legal
action (or ) ... participate in legal action (against TXU), it
stops," City Attorney Forrest Phifer told the Daily Progress.
TOYOBO COMPANY: Ohio To Receive Share in Zylon Vest Settlement
--------------------------------------------------------------
A court approved preliminary settlement could provide Ohio law
enforcement with a refund or assist in the replacement of
defective Second Chance-brand bullet proof vests in a nationwide
class action case, Ohio Attorney General Jim Petro said in a
statement.
The proposed settlement comes as part of a private class action
by the Southern States Police Benevolent Association ("SSPBA")
against Toyobo Co., Ltd. and Toyobo America, Inc., as well as
Second Chance Body Armor, Inc. and others. The District Court of
Mayes County, Oklahoma, issued a preliminary order approving the
settlement with Toyobo Co., Ltd. and Toyobo America, Inc. This
settlement does not include Second Chance Body Armor, Inc.
Litigation against that company is currently stayed due to its
bankruptcy status.
"Through letters to the law enforcement community I am
recommending that they review the proposed preliminary
settlement carefully with their local prosecutor or legal
representative," said Mr. Petro. "My office will continue to
update Ohioans about additional information regarding Second
Chance."
The settlement provides $29 million to purchasers and owners of
Second Chance vests containing Zylonr, including Ultima, Ultimax
and Triflex model vests. Purchasers and owners of these vests
will have three options to choose from if they elect to
participate in the settlement.
Purchasers and owners should receive notification by mail soon
that will explain the settlement options in detail, along with
instructions on how to file a claim to participate in the
settlement or how to opt out or object to it. More information
can be found at www.zylonvestclassaction.com or by calling the
claims administrator at 1-877-567-2754. Additional information
may be found on the SSPBA website, www.sspba.org, or by
contacting class counsel W. Pitts Carr at 1-888-755-1649 or
Allan Kanner at 1-800-331-1546.
Summaries of the three settlement options are:
(1) Option 1 - A cash option to receive a pro rata share of
the $29 million settlement fund. The amount each
officer or agency receives is dependent on the total
number of Class Members that participate in the
settlement. Each Class Member selecting this option is
free to use the money received from the Settlement Fund
in any manner they choose.
(2) Option 2 - Class members may elect to use their pro
rata share of cash from the Settlement Fund to purchase
a replacement vest from Armor Holdings Products, L.L.C.
The company will be responsible for all transaction
costs associated with the purchase and delivery of
these vests.
(3) Option 3 - Class members may elect to receive a
nonrefundable credit or voucher from Armor worth $25
more than their pro rata share of cash from the
settlement fund to purchase an Armor replacement vest
or any other Armor product available from its
distributors.
For Additional Information on this Press Release, contact
Michelle Gatchell, Attorney General's Office, by Phone:
(614) 466-3840 or visit the Website: http://www.ag.state.oh.us/.
UNITED STATES: FDA Issues Safety Alert on Recalled Smoked Salmon
----------------------------------------------------------------
The U.S. Food and Drug Administration (FDA) is issuing a Safety
Alert to consumers about the recall of Smoked Salmon Skinless
Sliced Sides packaged in various 2 to 4 lb. weight packages
because they may be contaminated with Listeria monocytogenes.
The products are sold under the brand names: Imperial Salmon
House, Superior brand Norwegian Cure and Golden Eagle Smoked
Salmon.
The alert extends to packages produced on June 13th, 2005 and
have a shelf life of 3-4 months if maintained in an un-opened
frozen state, four days if kept refrigerated. They are sold in
individual 2 to 4 lb. packages labeled as: "Processed by Hickory
House, Hialeah, FL 33016", "21555, Product of the USA", "keep
frozen until ready to use." The product was sold in Florida,
Georgia, New York and Virginia.
Listeria monocytogenes is an organism, which can be serious and
sometimes cause fatal infections in young children, frail or
elderly people, and others with weakened immune systems.
Although healthy individuals may suffer only short-term symptoms
such as: high fever, severe headache, stiffness, nausea,
abdominal pain and diarrhea, Listeria infection can cause
miscarriages and stillbirths among pregnant women.
If you experience the symptoms listed above, you should contact
your health care provider. No illnesses have been reported to
date.
The contamination was noted after routine testing by the Florida
Department of Agriculture and Consumer Services revealed the
presence of Listeria monocytogenes.
Consumers who have purchased this product are urged to destroy
it. Questions may be directed to the recalling firm, Golden
Eagle Smoked Foods, Inc., DBA Hickory House, Hialeah, FL 33016
at (305) 512-5900.
WASHINGTON: Utah Women Sue DOC Over Sex Offender's Supervision
--------------------------------------------------------------
The state's failure to provide supervision for a convicted sex
offender has led to a lawsuit against the state filed by two
women shot by the man in 2004.
The suit, filed July 18, 2005, alleges that the Department of
Corrections (DOC) failed to provide even minimal supervision to
Richard Wilson, although the twice-convicted sex offender
required the highest level of oversight by DOC standards.
On June 9, 2004, Mr. Wilson robbed and shot both Kimberli
Lingard and Diana "Dee" Jensen within hours of each other,
leaving them for dead -- the final victims of his crime spree
that included robbery, rape and murder. Mr. Wilson's 24-day
crime spree ended when he killed himself after a high-speed
police chase near the Utah-Nevada border.
"These people were victims of brutal crimes at the hands of a
high-risk, repeat offender," said Tony Shapiro, attorney for the
Lingard and Jensen families. "However, they were also victims of
a corrections system that has failed to make the public's safety
its number-one priority."
When Mr. Wilson was released in February 2004, the Department of
Corrections knew that he was an offender who was at high risk to
re-offend. According to the complaint, the DOC knew Mr. Wilson
was a violent drug user who had previously tried to evade DOC
supervision.
Mr. Wilson had a felony criminal history dating back to 1989
including robbery, rape, theft, and failure to register as a sex
offender, the complaint states. In 1995, he was convicted of
committing rape at knifepoint in Vancouver, Washington. He was
released in February 2004 after serving the minimum term.
According to the complaint, Mr. Wilson was required to be
supervised by the DOC upon his release. The suit states that Mr.
Wilson's community corrections officer (CCO) met with him on
four occasions between March 5 and March 24, 2004, but failed to
follow up after that date.
The complaint notes that aside from a urinalysis on April 13,
2004, the DOC had no other contact with Mr. Wilson, with no
attempted home visits or field contacts.
On May 18, 2004, Mr. Wilson's CCO called his home and indicated
to Wilson's mother that Wilson needed to report to the DOC, the
suit states. When Mr. Wilson never showed up, neither his CCO
nor any other DOC representative did anything to follow up.
"We intend to show that the DOC did very little to ensure that
Wilson was working or performing community service, and
otherwise abiding by the terms of his release," Mr. Shapiro
said. "This complete failure by the DOC ultimately caused
tremendous harm to a number of innocent victims.
"The DOC's lack of meaningful supervision of Mr. Wilson is even
more startling when one compares his CCO's supervision of Wilson
in 2004 with his prior supervision of Wilson in 2001 through
early June 2002," Mr. Shapiro added. "During that time, his CCO
made many field contacts with Wilson, administered 15 urinalysis
tests to ensure that Wilson was not using illegal drugs, and yet
Wilson still managed to abscond after stealing a truck and a
credit card.
"Mr. Wilson's CCO knew that even the level of supervision he
used in 2001-2002 was insufficient," Mr. Shapiro said.
The DOC's supervision was so inadequate that they were unaware
of Mr. Wilson's death. His corrections officer had a bench
warrant issued for Mr. Wilson's arrest on June 21, 2004 -- nine
days after he committed suicide, according to court documents.
"The DOC requires that an offender like Mr. Wilson, who is
listed in the highest and most dangerous category of offenders,
be given the highest level of supervision," Mr. Shapiro said.
"Had the DOC followed its own policies, directives and training,
Mr. Wilson's whereabouts would have been known on June 9, 2004
and Kimberli Lingard and Diana Jensen would not have been shot
and severely injured."
Ms. Lingard, who underwent several hours of brain surgery and an
angiogram, was hospitalized for more than three weeks. She
suffered permanent nerve damage, sensory loss, and cognitive
impairments.
Mrs. Jensen was hospitalized and her injuries resulted in
permanent disabilities. In addition to her physical injuries,
Mrs. Jensen and her husband suffered severe financial losses as
the gas station they owned failed after the shooting.
The suit seeks damages for both Ms. Lingard and Mrs. Jensen's
physical injuries, pain and suffering, emotional distress, past
and future medical expenses, wage loss, other expenses, and
other economic damages.
For more details, contact Tony Shapiro of Hagens Berman Sobol
Shapiro, LLP, Phone: +1-206-623-7292, E-mail: tony@hbsslaw.com
Asbestos Alert
ASBESTOS LITIGATION: Dockyard Worker Dies from Asbestos Exposure
----------------------------------------------------------------
At last week's inquest, the Coroner recorded a verdict of death
due to industrial disease in the case of a worker who had
contact with asbestos dust while working at a Government
dockyard.
Retired marine engineer and fitter Edgar Harris, aged 76, of
Peasland Road, Sidmouth, died of mesothelioma, an asbestos-
linked cancer of the lining of the lungs.
Mr. Harris had formerly worked in the dockyard at Portsmouth
from 1943. He also worked as an apprentice in boiler rooms,
where pipes were lagged with asbestos. Court documents revealed
that before his death, he stated that it was "like working in a
snowstorm of asbestos particles."
Dr. Elizabeth Earland, the Exeter and Greater Devon Coroner,
said he had been diagnosed as terminally ill and had died at
home last May 10 after becoming exposed to asbestos during his
working life.
According to his widow, Daisy, a successful claim for
compensation had been made against the Ministry of Defense.
ASBESTOS LITIGATION: Party Urges Gov't to Rush Asbestos Removal
---------------------------------------------------------------
The Liberal Party is urging the Queensland government to fast
track the removal of cancer-causing asbestos fiber from the
public schools, The Bayside Bulletin reports.
The Queensland Liberals are also calling for the Education
Minister Anna Bligh to be replaced over the May-June report,
which shows asbestos is present in 21 schools, proving that the
Minister has misled parents and teachers regarding the state of
contamination.
As previously reported in the May 27, 2005 edition of the Class
Action Reporter, the Queensland Government moved to allocate an
extra $120 million in the state budget to replace more than
1,100 asbestos-riddled roofs in 370 schools. The program is
slated to begin with a $7.2 million allocation to replace 70
roofs in 61 schools over the next financial year. Premier Peter
Beattie also told the Parliament that the work would be carried
out in over 10 years.
Federal Member for Bowman Andrew Laming said Redland children
could remain at risk of contracting asbestos-related illnesses
for the whole length of these 10 years. In the Redland Shire
alone there are close to 20 public schools containing asbestos
fiber, including eight with asbestos roofs.
Mr. Laming called on local State MPs, Messrs Choi, Briskey, and
English to petition the Premier and Education Minister to
resolve the problem.
State Member for Capalaba, Michael Choi, replied that asbestos
removal could not "happen overnight." He said that there was no
risk to pupils unless the asbestos in the buildings would be
disturbed.
Queensland has yet to adopt a national safety code requiring
clear labeling of asbestos in schools. The National Occupational
Health and Safety Commission in April declared a new code of
practice for the management of asbestos in workplaces, requiring
warning signs.
ASBESTOS LITIGATION: Conference Turns Focus on Staff Education
--------------------------------------------------------------
On Asbestos Awareness Day, leading experts reiterated their call
for employers to educate their staff about the dangers of
asbestos in the workplace.
More than 200 people across the UK attended the event, which was
hosted by Bristol-based refurbishment company Midas Property
Services and Shield Environmental Services. The event was aimed
at helping employers reduce the risks of asbestos in the
workplace.
Aside from the presentations, the Bristol conference also had
trade displays, exhibitions, handouts and free health checks.
Safety Officer Tony Abbott said that although there are more
safety measures nowadays, people are still being put at risk by
unknowingly working on or near to asbestos-containing materials.
He emphasized the duty of care that every business owes to its
employees. He said that the risk of exposure occurs when changes
are made to building structures, such as during refurbishment
work, which can disturb and release harmful asbestos fibers
"It is vital that companies educate their workforce about the
risk of asbestos exposure and have a risk management plan in
place to reduce the likelihood of this happening," Mr. Abbott
added.
Asbestos-associated diseases are the biggest cause of work-
related deaths in the UK. According to the Health and Safety
Executive, 3,500 people die every year as a result of exposure
to asbestos. The agency predicts that the death toll will
increase to 10,000 by 2010.
Despite new safety measures, the number of asbestos-related
deaths is set to increase because illnesses resulting from
asbestos exposure can take up to 60 years to manifest.
ASBESTOS LITIGATION: Derby School Case Adjourned Until September
----------------------------------------------------------------
Court magistrates adjourned the case related to the release of
asbestos dust at a Derby primary school until September 8, 2005.
Silverhill Primary was shut for eight weeks after asbestos was
discovered during routine maintenance work. The contamination
occurred during the replacement of up to 30 windows. Contractors
broke wall panels exposing the asbestos from February 16 last
year, but the problem was not discovered until March 9.
The incident exposed 400 pupils and staff to the potentially
fatal substance over a three-week period. More than GBP750,000
had been spent for the decontamination after asbestos was
discovered last March. The school reopened in May 2004 after
being closed for three months.
The city council and Peter Westran, from Horizon Windows and
Glass, are accused of failing to ensure the safety of employees.
Former head teacher Philip Robinson is charged with failing to
ensure the health and safety of others. The Environment Agency
confirmed it has also charged Horizon Glass and Windows under
the 1990 Environmental Protection Act, concerning the depositing
of asbestos.
No pleas have been entered in the case.
ASBESTOS LITIGATION: EPA Probes Dumping Incident at AU Toll Road
----------------------------------------------------------------
The Environmental Protection Authority is investigating claims
that asbestos was dumped illegally on land where construction of
the new toll road is ongoing.
A truck driver said in a statutory declaration that he dumped
two loads of asbestos at a Ringwood Eastlink reserve near Summer
Lane.
Senior manager of urban services Stuart McConnell said they were
first informed of the illegal dumping in May and are conducting
further investigations. However, he claims that they did not
find any visible signs of asbestos during a site inspection
before receiving the declaration.
The EPA is working with Theiss John Holland, which was
constructing the tollway, to address the clean up of the site.
Opposition spokesman for the environment, Phil Honeywood, said
the Government had a responsibility to ensure the company
building the tollway managed their site according to
environmental regulations. He is calling for an independent
audit to resolve the issue.
Whitehorse City councilor Chris Aubrey said residents and
workers could have been exposed by any allegedly dumped
asbestos.
A spokesman for Theiss John Holland said they were awaiting the
outcome of the EPA investigation.
ASBESTOS LITIGATION: UK Govt Expands Coverage in Benefits Scheme
----------------------------------------------------------------
Considered a major breakthrough, lung cancer sufferers exposed
to asbestos will soon be able to get government benefits for the
first time and will have increased chances of claiming
compensation.
In the past, these people were disadvantaged since only those
with asbestos-related diseases such as asbestosis, mesothelioma,
and pleural thickening could claim benefits. Being afflicted
with lung cancer alone and not one of the other diseases set
back the case since it was thought the illness could have
developed from other causes, such as smoking.
Leading industrial diseases lawyer Brigitte Chandler, who
herself has fought successfully for many Swindon people through
the courts, has hailed the government's change of stance.
Ms. Chandler, a solicitor with law firm Charles Lucas & Marshall
is urging lung cancer sufferers exposed heavily to asbestos and
their partners to apply for the government pension as soon as
the regulations are in force. She is also encouraging them to
seek legal advice now that they are more likely to take a claim
for compensation successfully to court.
The asbestos-related cancer mesothelioma - dubbed the Swindon
Disease - has accounted for thousands of deaths in Swindon, many
of whom worked at the Great Western Railway in the town.
Thousands of people were exposed to asbestos between the 1940s
and 1970s when working in the railway industry and shipbuilding
and construction.
Margaret Hodge, minister for Employment and welfare Reform
accepted all the report recommendations from the Industrial
Diseases Advisory Council to change the schedule of prescribed
diseases.
ASBESTOS LITIGATION: Chase Corp.'s Lone Pending Suit Inactive
-------------------------------------------------------------
Chase Corporation (AMEX: CCF), a diversified manufacturing
Company providing a wide-variety of high quality products and
services, is one of over a hundred defendants in a personal
injury lawsuit, which alleges personal injury from exposure to
asbestos contained in Chase products. This lawsuit, pending in
Ohio, has been inactive with respect to Chase since the Company
was named as a defendant in July 2004.
The Company, based in Bridgewater, MA, was dismissed from
another personal injury lawsuit in early 2005. It had likewise
been named as a defendant in the suit alleging injury from
exposure to asbestos contained in the Company's products.
ASBESTOS LITIGATION: EPA Conducts Testing on Demolition Methods
---------------------------------------------------------------
After a previous demolition proved to have released
"unacceptable levels" of asbestos in the air, the Environmental
Protection Agency will be revising its protocols and will be
using a different technique in its next project in downtown
Libby, Montana.
In late June, the EPA tore down a dilapidated structure between
Epperson Mountaineering and Tony's Muffler in Libby. According
to information released by the agency, extensive air and dust
sampling taken indicated the presence of asbestos at the
immediate work site.
EPA project manager Peggy Churchill said that samples, which
were taken throughout the three days workers were on the site,
are still being analyzed but it is clear that the contamination
was confined to the work area and did not extend beyond the
perimeter. To get the data, air monitors were set up at
different heights in three rings extending from the immediate
work site. Dust was also collected at locations around the area
and indoors of nearby businesses. Samples are being studied to
determine at what points in the demolition asbestos fibers were
released and how they behaved once they were in the air.
The initial demolition had followed a nationally reviewed
workplan drawn up by the EPA. However, the next will be
conducted in a considerably different manner. The house to be
torn down will be pre-wet and water will be sprayed directly
into the wall cavities over the 24 hours preceding demolition.
Quick analysis of samples is planned for updates while
demolition work is in progress.
EPA policy calls for buildings to be cleaned of asbestos
contamination before demolition, except in cases where the
building is structurally unsound, as in the case of the downtown
building, or impossible to clean, as with the house being
demolished this week.
ASBESTOS LITIGATION: Japan Asbestos Group Lobbying Delayed Laws
---------------------------------------------------------------
In 1992, Japanese lawmakers discarded a proposed bill seeking to
ban asbestos after an asbestos industry group lobbied against
it, according to the daily Mainichi Shimbun.
The Japan Asbestos Association had said the dangers of asbestos
had been exaggerated. It reasoned further that alternatives to
asbestos would be expensive and that the safety of these
substitutions had not been adequately verified anyway.
As disclosed last Friday, July 15, 2005, in the Class Action
Reporter, the health ministry plans to ban all asbestos use by
2008 following reports that hundreds of workers at various
companies have died from asbestos-related diseases. Asbestos
remains to be used to make gaskets for machinery, insulating
plates for switchboards, seals for chemical plants and
industrial rope.
Accusations of government negligence over its policies on
asbestos now proliferate especially since it was yet in 1980
that the World Health Organization sent out a warning about the
carcinogenic material. Japan did not ban the two most toxic
kinds of asbestos until 1995 and prohibited asbestos use in
construction only last year.
Socialist lawmakers proposed this bill in 1992 that would have
banned the use, sale or manufacture of asbestos. The bill also
called for surveys on its health effects.
An association official was quoted as saying, "The association
at that time probably believed that asbestos was safe if laws
and government directives were obeyed. This is different from
both the present social situation and the thinking of the
association."
In the past two weeks, revelations of asbestos-linked deaths
from about 33 companies in Japan have hogged the media. Health
Ministry data shows that nearly 900 people died from
mesothelioma, a lethal cancer of the chest caused mainly by
asbestos exposure, in 2003 alone.
Asbestos was extensively used in construction in Japan because
the nation's population density makes fire prevention a
priority.
ASBESTOS LITIGATION: Court Upholds Junking of Suit V. John Crane
----------------------------------------------------------------
The Court of Common Pleas of Pennsylvania on May 24, 2005
affirmed the decision to dismiss the asbestos-related injury
suit against John Crane Inc., citing failure to comply with
Pennsylvania's two-year statute of limitations.
Marilyn Shaw, widow and executrix of the estate of John Shaw,
filed the appeal from the order dated March 8, 2005 that
dismissed her claim.
John Shaw claimed that he commenced this civil action against
John Crane Inc. within two years of when he was diagnosed with
an asbestos-related cancer.
Court records show that on September 25, 1985, the Shaws filed a
complaint in the Court of Common Pleas of Philadelphia County,
in which he named numerous defendants but did not name John
Crane, Inc. In the 1985 lawsuit, Mr. Shaw filed a negligent
claim and strict liability claim for exposure to asbestos in his
work area.
From 1952 to 1984, Mr. Shaw continually worked with, used,
handled and was caused to come in contact with and be exposed to
the defendants' asbestos products. He was employed as a laborer
in 1952, as a lab technician from 1953 to 1954, as a laborer
from 1954 to 1955, as a welder from 1955 to 1957, as a
maintenance security worker from 1957 to 1958, as an insulator
from 1958 to 1967, and as an inspector from 1967 to 1984; all of
the above at the Sun Oil Company in Marcus Hook, PA.
In January 2, 1985, Mr. Shaw became aware that he suffered from
asbestosis and chronic restrictive pulmonary lung disease. As a
result, he claimed to suffer from severe anxiety possibly rising
to a traumatic neurosis or cancerophobia due to knowledge that
he is likely or could possibly contract cancer because of his
exposure to asbestos at his work place.
In its defense, John Crane, Inc. contended that at the time the
2003 civil action was filed, the plaintiff already knew of his
asbestos-related condition 18 years previously. It argued that
an action for personal injury in the Commonwealth of
Pennsylvania must be commenced within a two-year statute of
limitations.
The Court, presided by Judge Norman Ackerman, held that no error
was committed in granting John Crane's motion for summary
judgment in this suit. It stated that Mr. Shaw had an
opportunity in 1985 to recover damages for both an asbestos-
related condition and for fear and risk of cancer. It stated
that because Mr. Shaw chose not to assert such claims against
John Crane then, he is barred from bringing this action.
John Crane, a subsidiary of the UK's Smiths Group plc,
manufactures seals, packings, lubrication systems and power
transmission couplings. Headquartered in Morton Grove, IL, John
Crane has more than 25 offices across the US and a presence in
more than 20 other countries throughout the world.
ASBESTOS LITIGATION: New U.S. Lawsuits Loom Before James Hardie
---------------------------------------------------------------
New lawsuits threaten James Hardie Industries over its asbestos
exports to the United States and its involvement in asbestos
mines and mills in South Africa, reports The Australian.
Hardie, being one of the few former asbestos producers in the
U.S. that has not gone bankrupt and continues to make huge
profits, has encouraged US law firms to seek opportunities to
sue it. Hardie exported asbestos building products and brake
blocks from Australia to the U.S. from the 1960s to the 1980s.
Several US law firms are also considering suing the company for
its involvement in South African blue asbestos mines. Hardie is
the second-largest shareholder in Cape Asbestos, which has been
sued in numerous asbestos compensation cases in the U.S. Cape
Asbestos had exported its products to the U.S. but its main
owner, Cape Plc, would not answer suits.
Earlier this year, Hardie's asbestos compensation trust had paid
out US$250,000 to an American victim. The company is believed to
face a Californian court for allegedly killing two Americans
with its asbestos exports. Hardie chief financial officer
Russell Chenu at the time played down the company's American
exposure, saying the asbestos exports to the U.S. had been
"modest."
The US legal newsletter Mealeys Law Report revealed that Hardie,
which now has the vast majority of its operations in the U.S.,
had been named in 75 asbestos suits in the San Francisco
jurisdiction alone since 1999, with several cases pending.
David Dogan, whose law firm Dogan & Wilkinson of Jackson,
Mississippi, represents U.S. companies that manufactured
asbestos, said he planned to have Hardie brought in as a co-
defendant to share the costs.
Hardie spokesman James Rickards said that the Company continued
to believe the prospects of actions against it in the U.S., or
for its past involvement in Cape Asbestos, were minimal.
ASBESTOS LITIGATION: UK School Exposure Causes Teacher's Death
--------------------------------------------------------------
The Greater Manchester Coroner's Court heard that asbestos
exposure at Culcheth High School caused the death of a former
teacher.
Barrie Cunliffe, who died of asbestos-induced lung cancer in
June 2005, taught geography at the school and headed the Bronte
house from 1966 until 1972. He was diagnosed with mesothelioma
in 2004. In a statement made before he died, he described
several instances of exposure to asbestos, including working
near an asbestos factory in Rochdale and on a secondment to
Laportes factory in Widnes.
However, during the inquest, two colleagues from Culcheth High
School, head teacher Brian Stevens, and teacher John Leach, both
remembered working on lagged piping as the old school building
was rebuilt from 1969 to 1970. Mr. Cunliffe's classroom was down
the corridor from where most of the work was carried out.
Simon Nelson, Coroner for Greater Manchester North, recorded a
verdict of death by industrial disease.
Solicitors acting for his widow, Yvonne, have now begun a
compensation claim against Lancashire County Council, which ran
the school at the time.
ASBESTOS LITIGATION: Group Finds Fault in Cape's Funding Scheme
---------------------------------------------------------------
Asbestos campaigners criticized the proposed GBP40 million
asbestos fund, saying that the scheme is "unacceptable to Cape's
asbestos victims."
The fund, which is meant to cap UK multinational Cape Plc's
asbestos liabilities, would be reviewed by an independent body
every three years and topped up only if Cape has sufficient
funds. The scheme, which would need to be approved by the
courts, would protect Cape from asbestos litigation within the
UK and remove the threat of insolvency should asbestos claims
increase dramatically.
The English Asbestos Victims Support Groups' Forum said the
proposed fund, which will be overseen by a Cape subsidiary,
would receive GBP40 million to compensate Cape's UK asbestos
victims for the next 12 years.
Cape, which owned the Barking's until the 1960s when it was
closed, allocated the fund to cover all UK claims made by former
employees, who have contracted the asbestos-related lung cancer
and other respiratory illnesses, including their families.
Tony Whitston, spokesperson for the Forum, said the group was
not convinced by supposed safeguards on the fund. He added, "If
claims were to increase, there is no guarantee that Cape will
top up the fund and asbestos victims would be left high and
dry."
Many mesothelioma settlements are in six figures, and at least
two have broken the GBP1 million mark, the largest being GBP4.37
million in 2003. Mr. Whitston said that all previous schemes to
cap companies' asbestos disease liabilities have disadvantaged
asbestos victims.
ASBESTOS LITIGATION: CA Court Affirms Junking of 33 Suits V. CCR
----------------------------------------------------------------
The First District of the Court of Appeal of California on July
15, 2005 affirmed a trial court ruling, which dismissed 33
asbestos-related cases brought against the Center for Claims
Resolution for its failure to fund a portion of the settlements
owed by GAF Corporation.
In earlier litigation, the 33 plaintiffs filed suits against GAF
Corporation and 20 other defendants in which they alleged
personal injuries from exposure to asbestos products. They
settled those in negotiations with the Center for Claims
Resolution, which is a corporation formed by a consortium of
former asbestos producers to coordinate the defense and
settlement of asbestos personal injury claims. As part of the
agreement, they released from liability all CCR members as well
as their related companies, employees, distributors, and
insurers. For each plaintiff, CCR negotiated a single lump-sum
payment without disclosing which of its members would fund the
settlement.
CCR billed GAF for its share of the settlements negotiated with
plaintiffs, but GAF stopped making payments and filed for
bankruptcy on January 5, 2001. Plaintiffs initiated this
litigation, in which they sought to hold CCR liable for GAF's
unfunded portion of the settlements. CCR filed a motion for
summary judgment, contending that CCR itself is not responsible
because it was acting only as an agent for fully disclosed
principals.
GAF and 20 other former asbestos producers formed CCR in 1988 to
coordinate the defense and settlement of asbestos personal
injury claims against them. CCR has settled tens of thousands of
asbestos claims asserted against its members. Between November
1998 and December 1999, CCR negotiated settlements with
plaintiffs in the underlying asbestos litigation.
In January 2000, GAF stopped paying its share of any settlement
negotiated by CCR, including the settlements reached with
plaintiffs. CCR sent settlement checks to plaintiffs for amounts
smaller than the agreed settlement amount, with an explanation
that the amount assigned to GAF was not forthcoming. The CCR has
billed GAF Corporation for these amounts, but GAF has to date
refused to pay such billings."
In August 2000, the 33 plaintiffs represented in this appeal
filed lawsuits against CCR and GAF alleging breach of contract.
The lawsuits were consolidated in the trial court in May 2001.
CCR filed a motion for summary judgment in September 2001, upon
grounds that it negotiated the settlement agreements as an agent
for fully disclosed principals--CCR members named by plaintiffs
in their underlying personal injury suits--and as a matter of
law is therefore not liable for a principal's alleged breach of
those agreements.
Following receipt of opposition and a hearing, the court granted
the motion on October 25, 2001. For undisclosed reasons, the
court did not enter judgment in favor of CCR until October 2003.
Plaintiffs timely appealed the judgment to this court in
December 2003, and completed briefing in May 2005.
CCR and its former asbestos producer members are governed by a
contract authorizing CCR to settle asbestos claims and allocate
the costs of settlements. Under the producer agreement,
settlement shares are "generally allocated to the member
companies that were named as defendants in each case." CCR
submitted evidence that the producer agreement has been a matter
of public record, and its contents known to the asbestos
plaintiffs' bar, for over 10 years.
Plaintiffs' attorneys countered that CCR did not disclose the
terms of the producer agreement to them when settling the cases,
but did not affirmatively deny knowledge of the agreement from
other sources.
Judge Patricia Sepulveda, writing for the Court of Appeal, held
that CCR could not be held liable for breach of the settlement
agreements since it was not a party to the agreements and
participated in the settlements solely as an agent acting on
behalf of fully disclosed principals.
Lisa Lurline Oberg, McKenna, Long & Aldridge, San Francisco, CA,
William F. Sheehan, Goodwin Proctor LLP, Washington, DC, stood
for defendant-respondent, Center for Claims Resolution.
Headquartered in Wayne, NJ, G-I Holdings (formerly GAF
Corporation) is one of the US's oldest sources for commercial
and residential roofing materials, with more than 25 plants.
ASBESTOS LITIGATION: Trains with Asbestos Insulation Pose Risks
---------------------------------------------------------------
Three hundred railway employees walked off the job after it
became known that some of the carriages on the new train link
joining Thessaloniki with Istanbul contained asbestos, reports
The Kathimerini, a Greek news publication.
The Hellenic Railway Organization (OSE) recently purchased 21
carriages, which are intended for use on night travel for its
Balkan routes, from the French National Railway Company (SNCF).
Sources said that these carriages belonged to a lot withdrawn by
SNCF more than five years ago when it was discovered that they
contained asbestos.
The carriages were reportedly withdrawn from France after being
confirmed responsible for several deaths. As a result, the
French company was forced to pay compensation to some employees
after they developed lung cancer. It has also paid out pensions
to widows whose spouses died after working to remove the cancer-
causing material.
SNCF had the asbestos removed from the trains in 2002 but it
still remains in the carriage's insulation. OSE initially
rejected purchasing the carriages in 2000. However, five years
later, it decided to go ahead with the deal due to an increased
need for night trains.
Sources said that the latest recommendation made to OSE's board
did not make any mention of the asbestos, however, an attached
500-page report pointed out the problem. The signed agreement
also ensured that OSE waived any legal claims it may have
against SNCF.
The 21 carriages were purchased at a low price of EUR476,630.
Responding to reports that the trains posed a health threat, the
OSE simply said, "The carriages comply with all health and
safety standards."
The employees said they will return to work on the carriages
only after samples taken from them have been cleared by
independent laboratory tests.
ASBESTOS LITIGATION: Method to Detoxify Asbestos Removes Risks
--------------------------------------------------------------
A cheaper and safer alternative to detoxify asbestos could
eliminate the health hazards the mineral poses to people living
near plants and building demolition sites, reports The Asahi
Shimbun.
Akira Kojima leads a research team, which has developed a method
of reducing cancer-causing asbestos into harmless dust by using
a catalyst linked to the destruction of the ozone layer. Mr.
Kojima, a professor of materials engineering at Gunma National
College of Technology, said the process uses chlorofluorocarbons
or CFCs.
Through an energy-saving approach, byproducts such as calcium
fluoride and calcium oxide, created through decomposed CFCs, are
mixed with fibrous asbestos, and the mixture is heated to 700
degrees. The chemical reaction that arises converts the asbestos
from fibrous material into harmless powder.
Currently, breaking down asbestos is a costly process requiring
a large amount of electricity to heat the material to about
1,000 degrees.
Mr. Kojima has successfully patented his process, which uses
cheaper fuels such as kerosene. He is now developing commercial
applications. He expressed his intent to focus on recycling
byproducts of detoxified asbestos as a material for tiles and
concrete.
This research breakthrough comes in light of recent reports that
hundreds of Japanese workers involved in the manufacture of
products using asbestos have died from mesothelioma and other
respiratory diseases. Members of workers' families as well as
people living near factories where asbestos was used have also
died from such diseases. Concerns are rising about asbestos
spreading through the air when old buildings containing the
material are destroyed.
Masafumi Kikuchi, a professor at Meiji University, said it is
important to render asbestos harmless since even when buried,
there is the possibility that it could later become exposed and
cause health problems.
ASBESTOS LITIGATION: Widow Vows to Campaign Against Mesothelioma
----------------------------------------------------------------
The widow of a modern languages teacher who died of asbestos-
related cancer mesothelioma expressed her determination to draw
attention to the risks posed by the disease, reports The Derby
Evening Telegraph.
Alan Anthony died on May 27, 2005 at the age of 72. His wife
Carol said she and her husband worked at a comprehensive school
in southern England for many years. She believes Mr. Anthony was
exposed in a particular part of the school in the 1970s where
work was taking place and asbestos was disturbed.
Mrs. Anthony warned that mesothelioma could affect thousands
more in the years to come.
Liz Darlison, consultant nurse with Mesothelioma UK, commented
that although 85 to 90% of mesothelioma cases are attributed to
exposure to asbestos, it is likely that the remaining 10% of
cases were caused by asbestos but it is not known when the
exposure occurred.
Based in Leicester, Mesothelioma UK center provides impartial
up-to-date information for patients diagnosed with mesothelioma
and their caregivers.
ASBESTOS LITIGATION: Gov't Report Could Signal a Surge of Suits
---------------------------------------------------------------
Japanese firms could face an imminent lawsuit tide after a
government report linked asbestos-related diseases to the deaths
of at least 374 people in Japan, the Financial Times reports.
The government report, based on an 89-company survey, follows a
growing concern among the Japanese public that asbestos is not
only a work-related hazard. Companies may also face claims from
people living near factories.
Kazuzo Nomura, a lawyer for asbestos victims, said the deaths
suggest asbestos may develop into an environmental pollution
problem and cannot be dismissed as a labor issue.
The Japanese mesothelioma death rate rose to 878 in 2003, up
from 500 in 1995. However, the 2003 deaths recognized as work-
related was only 83, signifying a large number of victims could
have suffered from environmental exposure, said Sugio Furuya,
secretary-general of the nonprofit body, Ban Asbestos Network
Japan.
Japan used to be a leading asbestos importer before the
substance was almost completely banned last year.
In the west, asbestos litigation hit dozens of companies that
prompted US politicians to set up a US$140 billion (EUR107
billion, GBP82 billion) Asbestos Compensation Fund.
Mr. Furuya also pointed out that the continuing use of asbestos
in developing Asian countries was a significant cause for
concern. China, for example, is the world's second largest
producer of asbestos and also imports the substance from Russia.
It is unclear whether Japan will emulate the United States,
where an increasing number of large lawsuits have burdened the
business world.
With the demolition of buildings containing asbestos scheduled
to peak in Japan after 2010, the companies and the government
are hurrying to take measures to prevent asbestos-linked
diseases from expanding.
ASBESTOS LITIGATION: RI Court Denies GE's Motion to Dismiss Suit
----------------------------------------------------------------
The Superior Court of Rhode Island on May 27, 2005 denied the
motion to dismiss the asbestos-related case filed by Canadian
residents against General Electric Company.
Judge Alice Gibney presided over the suit styled, "Deborah L.
Kedy, legal rep. for the Estate of Brian Scallion V. A.W.
Chesterton Co., et al." Other defendants in the suit joined
General Electric's motion to dismiss. These include The Anchor
Packing Company; Garlock Sealing Technologies LLC, Successor by
Merger to Garlock, Inc.; General Refractories Company; Grefco,
Inc.; and Durametallic Corporation.
General Electric moved to dismiss the cases under the doctrine
of forum non conveniens, citing that public and private factors
demonstrate that the claims should not be heard by the Court.
The doctrine of forum non conveniens allows a court to dismiss a
case when a chosen forum, despite the existence of jurisdiction
and venue, is so inconvenient that it would be unfair to the
defendant to conduct its defense of the claim in that location.
The plaintiffs are lifelong Canadian residents whose employment,
exposure, injuries and treatment occurred in Canada. They are
alleging both personal injury and wrongful death caused by
exposure to products containing asbestos.
As General Electric is a corporation authorized to do business
in the state of Rhode Island, venue is proper in this Court.
The defendants argued that this Court should adopt the doctrine
of forum non conveniens and dismiss the case because the public
and private factors of Gulf Oil Corp. weigh strongly in favor of
dismissal.
The plaintiffs contended that neither the Rhode Island
Legislature nor the Rhode Island Supreme Court has ever
recognized the doctrine of forum non conveniens. They also
argued that even if this Court were to adopt the doctrine, the
public and private factors do not weigh in favor of the cases'
dismissal.
This Court held that as no litigation crisis exists in Rhode
Island, no compelling reason would warrant the Court's adopting
the doctrine of forum non conveniens at this time. The Court
boasted that it has been individually responsible for case
management of all asbestos-related litigation since January and
that it has resolved numerous cases. In addition, it said that
asbestos and asbestos-related litigation defies containment by
boundaries. That plaintiffs and defendants get their claims and
defenses heard as promptly as possible is essential to this
docket.
Only if and when the asbestos docket becomes too burdensome or
inefficient will the motion to dismiss the case be revisited,
said the Court.
ASBESTOS LITIGATION: W.R. Grace & Co. 2Q05 Profit Rises by 53%
--------------------------------------------------------------
Chemical maker W.R. Grace & Co.'s second-quarter profit
increased by 53 percent due to income from two insurance
settlements and an 18.2 percent jump in sales, AP reports.
Quarterly income of the Columbia, MD-based Company rose to
US$32.7 million, or 49 cents per share, from US$21.3 million, or
32 cents per share, last year. Revenue increased to US$676.5
million from US$572.4 million during the year-ago period.
Second-quarter results include about US$20 million of proceeds
from the settlement of two disputes with insurance carriers.
That was offset by higher interest expense to conform to rates
in Grace's proposed Chapter 11 plan of reorganization and higher
legal costs related to Chapter 11 and litigation related to
coverage of past environmental remediation and asbestos-related
costs.
The Bankruptcy Court proceedings are currently focused on the
estimation of Grace's asbestos-related liabilities, a process
that Grace expects to extend into 2006. The company, which spent
US$3.2 million in legal costs during the quarter, could get a
reprieve if Congress passes proposed legislation to end asbestos
liability lawsuits in exchange for a US$140 billion victims
trust fund.
The company has since stopped producing chemicals linked to
asbestos. W.R. Grace is one of hundreds of companies currently
facing criminal and civil lawsuits linked to the production of
asbestos, which was once used to make insulation and later was
found to cause cancer.
W.R. Grace said both current and former employees continue to be
involved as defendants in criminal proceedings regarding
asbestos claims. Two employees were named as defendants in a
civil suit filed during the quarter for the clean up of a former
vermiculite-processing site in New Jersey.
During the second quarter, W.R. Grace said its two biggest
business segments posted sharp gains due to overall higher
global demand. Davison Chemicals reported sales of US$358.9
million, up 20.5 percent from the year-ago period. Performance
Chemicals revenue rose 15.7 percent to US$317.6 million.
As of June 30, Grace said it had available liquidity of US$404.0
million cash, US$81.3 million net cash value of life insurance
and unused credit under its debtor-in-possession facility of
US$212.5 million. It added that it believes these sources of
liquidity are sufficient to support its business operations,
strategic initiatives and Chapter 11 proceedings for the
foreseeable future.
ASBESTOS LITIGATION: SB 852 Challengers to Hold Forum Next Week
---------------------------------------------------------------
Intending to strengthen opposition to the Asbestos Trust Fund
bill, the Coalition for Asbestos Reform and other groups from
across the political spectrum will hold a "Morning Newsmaker"
news conference on Monday, July 25 at 10 a.m. in the Murrow Room
of the National Press Club, 14th & F Streets NW, Washington,
D.C. (13th floor).
The Specter-Leahy bill, also known as S. 852, which would create
a US$140 billion trust fund to compensate asbestos exposure
cases, is one of the most controversial bills on the
congressional calendar. As Congress prepares to vote on the
measure, the Coalition for Asbestos Reform, representing small-
to-medium-sized business owners, will join conservative and
liberal groups with widely divergent interests to discuss why
this particular issue has united them.
The groups will discuss the impacts of the bill on the business
community, exposed workers, insurers and others. This Newsmaker
event will provide the opportunity to get the full span of
opposition to S. 852 gathered in one room.
As disclosed in the April 29, 2005 edition of the Class Action
Reporter, the Coalition for Asbestos Reform asserted at a Senate
hearing that the plan to make companies and insurers finance the
fund amounted to an "unconstitutional taking of private
property." However, bill supporters, including its author, Sen.
Specter, insisted the bill could withstand a constitutional
challenge.
For more information, contact: Keith Alm, Fleishman-Hillard,
202-828-8857 or almk@fleishman.com.
ASBESTOS LITIGATION: Munich Re Boosts US Unit Reserves by $1.6B
----------------------------------------------------------------
Munich Re, the world's largest reinsurance company, will boost
reserves at its American Re unit by US$1.6 billion to cover
casualty and asbestos policies in the U.S., ending a review of
potential claims at the business.
Meant to compensate for higher-than-expected court awards for
asbestos claims, the increase will cut second-quarter profit by
EUR400 million or US$480 million, Munich Re Chief Executive
Nikolaus von Bomhard said. The company is sticking to its 2005
goal of achieving 12 percent returns on equity after tax.
Investors welcomed the news as its shares posted the biggest
gain in 10 months after Mr. von Bomhard said he's sure the
reserve question at American Re has been "dealt with" following
the increase. Munich Re has added about US$5 billion to American
Re's reserves in the past five years, more than it paid to buy
the Princeton, New Jersey-based Company in 1996.
The stock rose EUR3.18, or 3.6 percent, to EUR92.48 in
Frankfurt, valuing the Munich-based company at EUR21.2 billion.
The shares have risen 2.2 percent this year, compared with an
8.4 percent increase in the 27-member Bloomberg Europe 500
Insurance Index.
Insurers worldwide have underestimated liabilities to compensate
victims exposed to asbestos by about US$14 billion, according to
a study by credit-rating company A.M. Best Co. Reinsurers have
struggled to cover U.S. casualty claims for policies written
between 1997 and 2001, when insurers relied on rising stock
markets to boost reserves and cover more policies at lower
rates.
American Re "is taking prompt account of current developments in
its clients loss reporting," Munich Re said in a statement. The
unit is also using "a particularly prudent approach to
determining reserves for losses that have been incurred but not
yet reported."
The Company said that the reserves "are particularly for losses
from liability and workers compensation business incurred
between 1997 and mid-2002 and for asbestos and environmental
claims."
Putting an end to funding shortfalls at American Re is part of
Mr. von Bomhard's strategy of restoring Munich Re's credit
rating and improving profitability. American Re's net income
more than halved last year after it boosted reserves by US$482
million. The unit will probably have a full-year loss in 2005,
Munich Re's chief financial officer, Joerg Schneider, said,
without predicting an amount.
Standard & Poor's, which has cut Munich Re's credit rating four
levels in the past 2 1/2 years to A+, said today it revised the
outlook on its rating on American Re to "developing" from
"negative." It reiterated its "stable" outlook for Munich Re.
Fitch Rating downgraded Munich Re's financial strength rating to
AA- from AA with a "stable" outlook, citing the impact of the
reserve increases on the company's earnings.
Munich Re has also been shedding stakes in German companies, and
last week sold EUR1.1 billion of shares in Allianz AG. The
company expects to book a gain of EUR560 million in the third
quarter from the sale, Mr. Schneider said.
ASBESTOS LITIGATION: Japan Govt Urges Industry for Voluntary Ban
----------------------------------------------------------------
Japan government agencies plan to ask 18 industry groups to
totally eliminate the use of asbestos in the country and to
substitute it with a safer material, The Yomiuri Shimbun
reports.
The Economy, Trade and Industry Ministry and the Health, Labor
and Welfare Ministry are considering support measures, such as
shouldering part of the replacement costs, to help companies
replace asbestos with another material.
The ministries will hold an emergency meeting this month with
the 18 groups, which include the Federation of Electric Power
Companies of Japan, the Japan Iron and Steel Federation and the
Glass Fibre Association of Japan, to urge them to stop using all
kinds of asbestos.
The use of blue and brown asbestos, the more dangerous forms of
asbestos, was banned in Japan in 1995. But the ban on the use of
white asbestos was delayed until October 2004. Even after that,
the use of white asbestos, which is extremely resistant to fire
and acids, is allowed in limited areas as exceptions, such as
for packing in pipe connectors at power stations.
Under the Industrial Safety and Health Law, the use of asbestos
will be completely banned by 2008. But due to the increase in
the number of illnesses attributed to asbestos, the ministries
decided to encourage companies to speed up voluntary actions to
refrain from using the material. According to the Economy, Trade
and Industry Ministry, 374 employees at 27 out of 89 building
material manufacturers and related companies have died from
health problems caused by asbestos.
As revealed on July 15, 2005 in last Friday's edition of the
Class Action Reporter, asbestos imports are expected to fall as
the manufacturing and other industries develop replacements to
the toxic material. Although the government officially banned
the shipment or production of asbestos only last year, it
continues to be used to make gaskets for machinery, insulating
plates for switchboards, seals for chemical plants and
industrial rope.
ASBESTOS LITIGATION: NSW Premier Drops Local Insulation Concerns
----------------------------------------------------------------
New South Wales Premier Bob Carr dismissed loose fiber asbestos
insulation concerns in the South Coast and refused to initiate
an inquiry into associated public health issues, the Bay Post
Moruya Examiner reports.
Andrew Constance, the Liberal member for Bega, called for a
public health warning issuance and the creation of a South East
Asbestos Taskforce after revelations earlier this year that a
lethal form of asbestos was used in home insulation in the 1960s
and 1970s.
Twenty years ago, the Federal and ACT Governments removed
asbestos fill from homes in Canberra but ignored affected homes
in Batemans Bay, Queanbeyan and possibly elsewhere throughout
South East NSW.
In a letter to Mr. Constance, Mr. Carr stated that NSW Health
investigated the public health issues associated with asbestos
insulation usage in the 1990s and would not consider the issue
again.
"Generally these are matters that are the responsibility of the
homeowner," Mr. Carr added. "The government remains focused,
however, on improving public awareness of issues relating to
asbestos in the home, particularly for homeowners and builders
undertaking renovations."
Mr. Constance also expressed concerns about the government's
decision to stop asbestos insulation testing in the past two
months after years of testing by the Public Health Unit within
Greater Southern Area Health Service.
"I am sure Health Minister (Morris) Iemma will be able to
confirm that the health service was accredited and qualified for
undertaking such testing and the government for the assessments
provided the appropriate facilities and testing sites," Mr.
Constance said.
ASBESTOS LITIGATION: Claimants Seek to Propose USG's Ch. 11 Plan
----------------------------------------------------------------
Lawyers for asbestos claimants objected to USG Corp.'s request
for extension to file a Chapter 11 plan and instead asked the
Court to allow them to propose a plan on how the value in a
reorganized USG will be handed out, Dow Jones reports.
Embattled in bankruptcy for more than four years, Chicago, IL-
based USG has been under massive liabilities stemming from
people alleging injury from exposure to asbestos products.
USG goes before a court August 29 to ask for its eighth
extension of the time during which it alone is entitled to
propose a Chapter 11 plan.
A committee that represents the interests of stockholders in the
Chapter 11 case has been empanelled, a sign that there could be
sufficient value in the company to leave shareholders with an
equity stake. Shareholders get nothing in bankruptcy until
creditors have been paid in full.
The Chapter 11 plan that USG's asbestos creditors want to
propose would allocate the Company's cash, notes and future
stock issues to asbestos claims and unsecured creditors.
Distributions would start as soon as a federal court sets a
number on USG's asbestos liabilities and as soon as the
bankruptcy court determines which USG units are accountable for
the asbestos claims.
Under the plan that asbestos claimants suggest, anything left
would go to the shareholders.
The Company contended only its U.S. Gypsum Co. unit should pay
and that other divisions be excluded from contributing into the
trust that would be set up under a Chapter 11 plan for asbestos
claimants.
USG wants to spell out its Chapter 11 plan after the conclusion
of what are expected to be prolonged federal court asbestos
estimation proceedings. However, asbestos creditors say that's
an unreasonable delay and that USG is making no progress in its
attempt to get out of Chapter 11.
The official committee of unsecured creditors, which represents
USG's commercial creditors, said it would be "reasonable and
practical" to hold up the filing of a plan for an additional six
months.
USG is requesting for until December 31 to file a plan.
ASBESTOS LITIGATION: Prosecutors Probe 3 Law Firms Over Claims
--------------------------------------------------------------
Federal prosecutors are looking into claims of improper conduct
concerning asbestos litigation at three law firms, The New York
Times reports.
G-1 Holdings, formerly GAF Corp., a roofing materials maker,
hired investigative firm Kroll Inc. to collect evidence in its
three-year-old civil lawsuit against Baron & Budd of Dallas;
Ness, Motley, Loadholt, Richardson & Poole of Mount Pleasant,
S.C.; and Weitz & Luxenberg of New York.
In extensive interviews Kroll collected from former employees of
the three law firms, employees said potential claimants were
coached and said there were efforts to influence doctors'
diagnoses.
In response to a subpoena, Kroll investigators turned over their
documents to prosecutors last month. The documents, which
surfaced in the bankruptcy case of G-1 Holdings, showed that
lawyers for G-1 have met with prosecutors from the U.S.
Attorney's Office in Manhattan in recent months. Lawyers said at
least one insurance company has also received a subpoena.
The criminal investigation could have broad implications for the
civil justice system that compensates victims of personal
injuries. If it proceeds to an actual case, it could also force
some lawyers who file what are known as mass tort claims to
change their tactics.
Asbestos litigation has been an extremely costly problem for
companies and a hugely profitable business for plaintiffs'
lawyers.
The U.S. Attorney's Office in Manhattan is also pursuing an
investigation into thousands of claims filed on behalf of people
who said they had been injured by exposure to silica, another
dangerous material.
Advocates of changes to the civil justice system will almost
certainly seize on the investigation. Plaintiff's lawyers said
they worried that any such changes might make it harder for
legitimate asbestos victims to recover damages.
The spreading investigation could result to a new wave of
litigation over claims that were already paid. People who are
genuinely sick, and who recovered less money than they might
have if so much of the asbestos compensation funds had not been
used to pay fraudulent claims, could sue the firms that filed
those false claims.
G-1 was driven to seek Chapter 11 bankruptcy protection in 2001
as a result of about 150,000 asbestos claims.
ASBESTOS LITIGATION: Workers Covered by Insurance Rises 53.7%
-------------------------------------------------------------
Compared to the previous year, the number of Japanese workers
with asbestos-linked diseases qualified for industrial accident
compensation rose to 186 in fiscal 2004 representing a 53.7%
increase, said Senior Vice Health, Labor and Welfare Minister
Hiroyoshi Nishi.
In a meeting of the House of Representatives Committee on
Health, Welfare and Labor, Mr. Nishi said that 849 people were
qualified to receive benefits for asbestos-linked illness under
the workers' accident compensation insurance by fiscal 2004. Of
the 849, 354 suffered from lung cancer and 495 had asbestos-
related cancer mesothelioma, Kyodo News reports.
For fiscal 2004, the 186 workers comprised 58 lung cancer
patients and 128 mesothelioma sufferers.
When asked if the government seeks to recognize health hazards
from asbestos exposure to be eligible for compensation as an
illness caused by pollution, Senior Vice Environment Minister
Hiroshi Takano said that at the moment, information is being
gathered via prefectural governments.
"It is necessary to analyze research results and then determine
if they conform to the objectives of the pollution health hazard
compensation law," added Mr. Takano.
ASBESTOS LITIGATION: Japan Gov't Fails to Warn Against Asbestos
---------------------------------------------------------------
Although the Japanese government was aware from 1976 of the
health risks asbestos posed to workers and their families,
including residents nearby the plants, it failed to introduce
effective countermeasures, The Mainichi reports.
As asbestos-related deaths continue to be reported, the
government is likely to face criticism over its inaction.
In 1976, the former Ministry of Labor sent notices dated May 22,
1976 to labor standards offices across the nation. Titled,
"Regarding promotion of measures to prevent health damage from
asbestos particles," the notice gave details on regulations for
the prevention of health risks from specified chemicals that
were revised in September 1975.
Attached to the notices was data from Britain that proved that
even relatives and nearby residents were at risk. The data
showed that of 83 British hospital patients who were diagnosed
with the asbestos-related cancer mesothelioma in the 50 years up
until 1965, nine were relatives of workers at factories handling
asbestos, and 11 were people living near the factories.
However, after issuing the notices, the government did not
introduce any illness prevention measures for those at risk.
In a news conference earlier this week, Economy, Trade and
Industry Minister Shoichi Nakagawa said that the government's
delay in enforcing regulations to control asbestos use could not
be refuted, but added that the government did not act illegally
or negligently at the time.
Officials at the Ministry of Health Labor and Welfare confirmed
that the notice had been sent, but said they were not able to
confirm the contents of the notice, because the person in charge
was not available.
ASBESTOS LITIGATION: Legislation to Reach Senate Floor on Sept.
--------------------------------------------------------------
The legislation's co-author confirmed that the Asbestos
Compensation Bill is not expected to come up on the Senate floor
before the August recess, Reuters reports.
Senate Judiciary Chairman Arlen Specter said that majority
leader Sen. Bill Frist postponed bringing the measure to the
floor. Sen. Specter, a Pennsylvanian Republican, suggested it
was a matter of scheduling, and made no reference to criticisms
of the bill that have been raised by both parties.
The Senate begins its month-long August recess at the end of
next week.
Asbestos was widely used for fireproofing and insulation until
the 1970s. Its fibers are linked to cancer and other diseases.
Injury claims have bankrupted dozens of companies.
The asbestos bill, which Specter co-sponsored with Vermont
Democrat Sen. Patrick Leahy, would halt asbestos injury suits
and pay the claims from a US$140 billion fund financed by
defendant companies and insurers instead.
While arguments from both sides continue to plague the bill, the
fact that those concerns remain dispels any thoughts that the
bill could be quickly debated on the Senate floor.
ASBESTOS LITIGATION: Study Reveals Asbestos in 90 Kansai Schools
----------------------------------------------------------------
About 90 schools in Japan's Kansai region still have asbestos-
coated building parts and ceilings, in a survey conducted by The
Yomiuri Shimbun.
No damage to health has been reported however.
In most schools, new ceilings are fitted beneath the asbestos-
lined ceilings to prevent spread of the harmful substance but
some schools, for financial reasons, failed to take measures to
counteract the possible risks.
From the hearing that the Yomiuri Shimbun conducted with
education boards in six Kansai prefectures, at least 30 public
high schools in Osaka Prefecture came out to still have
facilities coated with asbestos.
The Osaka Prefectural Board of Education coated the asbestos
ceilings of 21 schools to prevent scattering, but did not take
measures in nine other schools where asbestos-lined parts are
covered. Eleven primary and middle schools and a kindergarten in
Osaka, and schools in Sakai, Suita and Neyagawa also appeared to
contain asbestos.
In Hyogo Prefecture, asbestos is in six Kobe primary and middle
schools and 29 primary, middle and high schools in Itami,
Kawanishi, Amagasaki and Nishinomiya.
The Ministry of Education, Science and Technology intends to
conduct another probe of prefectural education boards nationwide
to check schools for asbestos.
ASBESTOS LITIGATION: UK Agency Probes Dumping at Housing Site
-------------------------------------------------------------
Prompted by documentary evidence supplied by locals, the
Environment Agency is continuing to investigate the dumping of
tons of deadly asbestos on a 14-acre Brixham site intended for
the location of 191 houses.
Alan Burrows, of the Environment Agency, said that after the
agency establishes the identity of the person responsible, it
would be prepared to prosecute for the criminal offense
committed.
Torbay Council, which gave permission for the development of the
14-acre site last December, admitted in a letter sent last week
to one of the residents, that "a significant amount of buried
asbestos has been found" and that more "may well be" found as
investigations continue. The council had previously been adamant
in asserting that the site posed no health threat and that
asbestos contamination was minimal.
Pontins set up the area as a holiday camp in 1938 when the
dangers of asbestos as insulation were not recognized. By 1989,
Pontins abandoned the site after fire gutted it down and
eventually sold it in May of that year. For many years, it was
also used as a children's playground. The council changed the
local planning laws to enable housing development after a
developer purchased the site.
Five years ago, the Health and Safety Executive investigated the
camp when contractors were removing some of the buildings. After
it discovered that a wide area had been contaminated, it advised
the Council to consider taking action under public safety
legislation to prevent children from being exposed to the
material.
Aside from the asbestos, the area is also a potential landfill
gas risk. The Environment Agency warned the council in August
2004 that any developer should check the area because a disused
household rubbish tip is situated a few hundred meters from
site's edge.
The planning consent for the site required a "remediation
statement" detailing how any residual asbestos was to be removed
before work began. However, the council has still not approved
this document even though demolition work has continued for
several months.
ASBESTOS ALERT: Former Employee Files Lawsuit V. EMI Group PLC
--------------------------------------------------------------
A former glassblower filed a suit against record company EMI
Group Plc for allegedly exposing him to asbestos during his
employment, The Shropshire Star reports.
Henry Lee, aged 64, of Chelmick Drive, Church Stretton, filed a
writ in the Queen's Bench Division of the High Court against the
Company, claiming damages of between GBP150,000 and GBP250,000.
He asserted that his pain, injury, loss and damage were caused
by the Company's negligence and breach of statutory duty.
According to the writ, Mr. Lee was diagnosed in November 2004
with asbestos-related cancer mesothelioma and was predicted to
have a limited life expectancy of less than a year. He is
accusing the company of failing to protect him from the health
dangers of exposure to the material.
Mr. Lee worked for EMI Group at its first factory in Hayes,
Middlesex from September 1956 to September 1991. For the first
10 months he was employed as a trainee glassblower when rolls of
asbestos tape were used in the workshop. He claimed that this
activity liberated asbestos dust into the atmosphere.
Citing the exposure as the culprit, Mr. Lee now claims to suffer
from breathlessness and pleural plaques. The writ states there
would be continued deterioration in his condition "probably with
worsening pain, increasing breathlessness and debility." He
stated that in the course of his terminal illness, he will need
increasing levels of assistance and constant nursing care.
Dylan Jones, spokesman for EMI Group, said that the company
could not make any comment to an ongoing case.
Company Profile:
EMI Group Plc
27 Wrights Ln.
London
W8 5SW, United Kingdom Phone: +44-20-7795-7000
Fax: +44-20-7795-7296
http://www.emigroup.com/
Fiscal Year-End : March
2004 Sales (mil.) : US$3,872.0
1-Year Sales Growth : 13.1%
2004 Net Income (mil.) : (US$130.7)
2004 Employees : 7,996
1-Year Employee Growth : (1.1%)
Description:
Headquartered in London, UK, EMI Group Plc is the third largest
record company in terms of worldwide sales. In addition to
recorded music, it is also the world's largest music publishing
business. It has operations in more than 50 countries.
ASBESTOS ALERT: DEP Halts NY Bldg Project for Disposal Breaches
---------------------------------------------------------------
The Department of Environmental Protection put a halt to the
condo project at the former Board of Education Building in
Brooklyn after its investigation revealed violations of asbestos
disposal regulations.
DEP spokesman Ian Michaels said that demolition workers were
found to have removed asbestos-containing debris from the
building. Nearly all of the 15 samples taken showed dangerous
levels of asbestos
Brooklyn developer David Walentas faces stiff fines and must pay
for a proper asbestos removal before the project can resume.
Documents filed with the Buildings Department indicated the
company, Two Trees Management, was aware of asbestos at the
site, Mr. Michaels said.
K&R Demo Corp. workers, who weren't wearing protective gear,
were seen dumping contaminated debris from 36 bins into a truck
days before the project was halted. Clouds of white dust from
the illegal operation spewed onto nearby buildings, alarming its
occupants to the possible health risk.
Edison Severino, manager of Local 78, the asbestos, lead, and
hazardous waste handlers union, said that Mr. Walentas should be
hit with the highest fines possible for showing disregard to the
safety of the workers and the public for the purpose of saving
money.
In proper asbestos removal, workers wear protective gear, the
site is closed off and monitored, and the debris is carefully
disposed of, according to experts.
ASBESTOS ALERT: GA Court Favors Prison Officers in Inmate's Suit
----------------------------------------------------------------
The U.S. District Court for the Middle District of Georgia on
July 6, 2005 dismissed the case against the defendants, prison
authorities who allegedly knowingly exposed an inmate to cancer-
causing asbestos.
U.S. Magistrate Claude Judge Hicks presided over the case
styled, "John Ed Boldin v. Jim Wetherington, et al.," with Case
No. 5:03-CV-308 (CWH). Kevin T. Brown and Mary Elizabeth Hand,
of Macon, GA, represented the defendants.
John Ed Boldin, who represented himself in this case, is an
inmate in the custody of the State of Georgia. He sued
defendants Jim Wetherington, Jimmy Sikes, Thalrone Williams,
Cheryl Chapman, Artie Braddock, Bob Davis, Lonnie Durden, Don
Hayslip, and David B. Harrison alleging that they violated his
constitutional rights while he was incarcerated at Rivers State
Prison in Hardwick, Georgia. Mr. Boldin claimed that the
defendants were deliberately indifferent to his medical needs
from October 2001 to March 2003 when they knowingly allowed him
to be exposed to extremely high levels of friable asbestos while
performing repair work at the prison.
In support of their motion for summary judgment, the defendants
submitted Mr. Boldin's deposition and their discovery responses.
They stated that the deposition and discovery responses
indicated that his Eighth Amendment rights have not been
violated by exposure to asbestos. Further, by Mr. Boldin's own
admission, he has suffered no medical problems as a result of
exposure to asbestos at Rivers but has had nightmares about
health problems related to asbestos exposure.
The evidence indicated that the Georgia Department of
Corrections did not know that Rivers contained asbestos until
late 2002. In February 2003, the DOC began contracting with
third parties to remove the asbestos from Rivers in various
locations including pipe chases, tunnels and crawl spaces. Prior
to the removal of the asbestos, precautions were taken for
inmate workers who worked in areas that contained asbestos. This
included not allowing inmates to work in areas that were
suspected to contain asbestos.
In the court's view, Mr. Boldin failed to establish his case
under the Eighth Amendment. It stated that Mr. Boldin submitted
no evidence to show that he was exposed to unreasonably high
levels of asbestos after the problem was detected, and does not
present any evidence of actual physical injury. Accordingly, the
court ruled that the defendants are entitled to summary
judgment.
ASBESTOS ALERT: NY Court Affirms Ruling V. Appalachian Insurance
----------------------------------------------------------------
The Appellate Court of the Supreme Court of New York on June 14,
2005 affirmed a ruling in favor of Appalachian Insurance Company
that individual claims against insured to recover for asbestos
exposure could not be aggregated in determining excess insurers'
duty to defend or indemnify.
Judges David Saxe, George Marlow, Joseph Sullivan, Milton
Williams, and Luis Gonzalez evaluated the case.
On December 23, 2003, the Supreme Court, New York County,
presided by Judge Ira Gammerman, declared that certain of the
excess insurers are not obligated to defend or indemnify the
insured with respect to any single claim that does not exceed
US$5 million.
The court assessed that availability of excess coverage is
triggered by an "occurrence," that results in personal injury,
sickness, disease or death. An individual claimant's exposure
to asbestos to the turbines manufactured by General Electric,
rather than earlier events, creates potential future injury,
i.e., the insured's design, manufacture and sale of the turbines
without warnings about asbestos. Accordingly, individual claims
could not be aggregated.
The NY Court considered General Electric's earlier arguments
insufficient.
E. Leo Milonas, David G. Keyco, Frederick A. Brodie, and Laura
L. Smith of Pillsbury, Winthrop LLP, New York; Evan A. Davis and
Goldie Weixel of Cleary, Gottlieb, Steen & Hamilton, New York;
and Gita F. Rothschild and Nicholas Gimbel of McCarter &
English, LLP, New York represented General Electric Company,
Appellant.
Patrick J. Dwyer of Smith, Stratton, Wise, Heher & Brennan, LLP,
New York, Scott M. Seaman and Jason R. Schulze of Meckler,
Bulger & Tilson, LLP, Chicago, IL represented Appalachian
Insurance Company, Respondent.
Michael J. Balch of Skadden, Arps, Slate, Meagher & Flom LLP,
New York represented North Star Reinsurance Corporation,
Respondent.
Brian R. Ade of Rivkin Radler, LLP, Summit, NJ represented
Federal Insurance Company, Respondent.
Dylan C. Braverman of Morrison, Mahoney & Miller, LLP, New York
represented Swiss Reinsurance Company, Respondent.
Richard A. Fogel of Law Office Richard A. Fogel, P.C., Islip, NY
represented Dairyland Insurance Company, Respondent.
Alexander H. Gillespie of Bonner, Kiernan, Trebach & Crociata,
Parsippany, NJ represented Riunione Adriatica DiSicurta and
Fireman's Fund Insurance Company, Respondents.
Elizabeth M. DeCristofaro and Alfred L. D'Isernia of Ford,
Marrin, Esposito, Witmeyer & Gleser, LLP, New York represented
Continental Casualty Company, Continental Insurance Company (as
successor in interest to certain alleged Harbor Insurance
Company policies), and Fidelity & Casualty Company of New
York and Pacific Insurance Company, Respondents.
Company Profile:
Appalachian Insurance Company
Allendale Park P.O. Box 7500
Johnston, RI 02919-0500
Phone: (401)-275-3000
ASBESTOS ALERT: DE Court Remands Claimant's Petition V. 2 Firms
---------------------------------------------------------------
The Superior Court of Delaware on May 26, 2005 reversed and
remanded an appeal from a decision of the Industrial Accident
Board, which dismissed a claimant's petition for workers'
compensation benefits based on the statute of limitations.
Judge John E. Babiarz Jr. wrote the decision for the case
tagged, "Larry Marshall V. Brand Insulation and Catalytic
Incorporated," with Case No. Civ.A.04A-08-005-JEB.
On July 12, 2002, Mr. Marshall filed a petition for workers'
compensation benefits against numerous employers alleging that
he had contracted asbestosis and kidney cancer due to asbestos
exposure in his workplace. Because the parties were unable to
agree to a hearing date, they entered into a stipulation which
provided that Mr. Marshall would withdraw his petition and
refile it within 60 days, and that the original filing date of
July 12, 2002 would toll the statute of limitations. He made a
timely refiling, naming only Brand Insulation and Catalytic
Inc., as employers, and the Board held a hearing in May 2004.
At the conclusion of the case, counsel for the employers moved
to dismiss the petition on grounds that the suit was time-barred
under the statute of limitations and the notice provisions for
occupational diseases. Following post-hearing briefing, the
Board granted the employers' motion to dismiss, finding that the
claimant did not file his petition within the statute of
limitations for workers' compensation benefits. The Board did
not address the notice issue.
Mr. Marshall filed a timely appeal to this Court, challenging
the dismissal, as well as evidentiary rulings made by the Board
during the hearing.
The parties agree that the first issue to be addressed is the
date upon which the statute of limitations was tolled. They also
agree that the Board erred in finding that the statute was
tolled as of January 7, 2004, the date upon which the claimant
refiled his petition. The record shows that all parties entered
into a stipulation which provided that the original filing date
of July 12, 2002 would toll the statute of limitations.
The Court concluded that the board erred in determining the date
on which the statute of limitations was tolled and that the case
must be remanded. The Court instructed the Board on remand to
adopt July 12, 2002, as the operative date for purposes of the
statute of limitations.
Richard T. Wilson, Wilmington, Delaware, stood for Larry
Marshall.
Richard P.S. Hannum, Wilmington, Delaware, represented Brand
Insulation while Nancy Chrissinger-Cobb, Wilmington, Delaware,
stood for Catalytic Incorporated.
ASBESTOS ALERT: Hexion's Bakelite Incurs Liability for Cleanups
---------------------------------------------------------------
Hexion Specialty Chemicals, Inc. revealed in its latest filing
to the Securities and Exchange Commission that thermosetting
resins producer Bakelite, which it acquired from Rutgers AG, has
responsibilities for environmental cleanup under various state,
local and federal laws in the countries in which it operates.
As a result of Bakelite's operations that involve the use,
handling, processing, storage, transportation and disposal of
hazardous materials, it has recorded liabilities of EUR288,000
and EUR760,000 at December 31, 2004 and 2003, respectively, for
all probable and estimable environmental remediation activities.
These accruals primarily represent two cases at the Solbiate,
Italy site where remediation was performed for asbestos-
containing materials identified on site and where remediation
was assessed by local authorities for cumene contamination
discovered. The removal of asbestos-containing materials for
insulation on pipelines began in 2003 and was finalized in
August 2004. This removal was not required under local law but
was carried out voluntarily.
In Italy, there have been several civil law claims filed against
Bakelite related to asbestos-containing materials that were used
in production. Italian regulations provide a general fund to pay
damages related to asbestos claims by employees, former
employees or surviving family members. The surviving family
members of two former employees have initiated legal claims
against Bakelite, in addition to their claim against the general
fund. It is currently unclear whether a claim against Bakelite
will be accepted by the Court, or to what damages Bakelite may
be exposed.
Furthermore, there is another asbestos related employee claim
against the Spanish subsidiary. For all of the asbestos related
claims, management has assessed the outcome of the litigation to
be favorable, and therefore no accrual has been recorded by
Bakelite.
Company Profile:
Hexion Specialty Chemicals, Inc. (NYSE: HXN Proposed)
180 E. Broad St.
Columbus, OH 43215
Phone: 614-225-4000
http://www.bordenchem.com/
Fiscal Year-End : December
2004 Sales (mil.) : US$2,019.0
1-Year Sales Growth : 158.2%
2004 Net Income (mil.) : (US$114.0)
2004 Employees : 6,900
Description:
Formed in 2005, Hexion Specialty Chemicals unites the former
Borden Chemical, Resolution Performance Products, Resolution
Specialty Materials, and Bakelite. The new company is the
world's largest thermosetting resins maker. It also manufactures
formaldehyde and other forest product resins, epoxy resins, and
raw materials for coating and sinks.
New Securities Fraud Cases
AVAYA INC.: Wolf Haldenstein Files ERISA Class Action Suit in NJ
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The law firm of Wolf Haldenstein Adler Freeman & Herz LLP filed
an ERISA class action lawsuit in the United States District
Court for the District of New Jersey, on behalf of all
participants and beneficiaries of the Avaya, Inc. Savings Plan,
the Avaya Inc. Savings Plan for Salaried Employees, and the
Avaya Inc. Savings Plan for the Variable Workforce
(collectively, the "Plans") established by Avaya Inc. ("Avaya"
or the "Company") (NYSE: AV), between October 5, 2004, through
the present (the "Class Period"), and whose accounts included
investments in Avaya Stock, against Defendant Avaya, certain
officers and directors of the Company who are members of the
Company's Compensation Committee, Finance Committee, and other
unnamed members of the Company's other benefits related
committees. The case name is Edgar v. Avaya Inc., et al.
The Complaint alleges that during the Class Period, Defendants
breached their fiduciary duties owed to participants and
beneficiaries of the Plans. The Defendants failed to act in the
interests of the Plans' participants and beneficiaries and with
reasonable care, skill, or diligence in offering Avaya Stock as
an investment option, purchasing Avaya Stock for the Plans,
holding Avaya stock in the Plans, monitoring the Plans'
investment in Avaya Stock, and communicating information
concerning Avaya's financial performance to the Plans'
participants and beneficiaries.
The Complaint further alleges that Avaya Stock was an
inappropriate investment in the Plans as Avaya represented to
the investment community that it was a highly successful
communications network company, while concealing,
(1) that its new go-to-market model in the United States,
created disruption affecting its U.S. sales, and
(2) as opposed to the Company's rosy financial projections,
there was softness in the U.S. technology market
further affecting U.S. sales, and
(3) that the costs of its Tenovis GmbH & Co. KG ("Tenovis")
acquisition far exceeded projections.
For more details, contact Mark C. Rifkin, Esq., Matthew M.
Guiney, Esq., or Derek Behnke of Wolf Haldenstein Adler Freeman
& Herz LLP, Phone: 1-800-575-0735 or +1-212-545-4600, Web site:
classmember@whafh.com.
MAJESCO ENTERTAINMENT: Charles J. Piven Lodges Stock Suit in NJ
---------------------------------------------------------------
The Law Offices Of Charles J. Piven, P.A. initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of Majesco
Entertainment Company (NASDAQ: COOL) between December 8, 2004
and July 12, 2005, inclusive (the "Class Period").
The case is pending in the United States District Court for the
District of New Jersey against defendant Majesco Entertainment
Company and one or more of its officers. The action charges that
defendants violated federal securities laws by issuing a series
of materially false and misleading statements to the market
throughout the Class Period, which statements had the effect of
artificially inflating the market price of the Company's
securities. No class has yet been certified in the above action.
For more details, contact the Law Offices Of Charles J. Piven,
P.A., The World Trade Center-Baltimore, 401 East Pratt Street,
Suite 2525, Baltimore, MD, 21202, Phone: 410/986-0036 E-mail:
hoffman@pivenlaw.com.
MAJESCO ENTERTAINMENT: Shepherd Finkelman Files Stock Suit in NJ
----------------------------------------------------------------
The law firm of Shepherd, Finkelman, Miller & Shah, LLC filed a
lawsuit seeking class action status in the United States
District Court for the District of New Jersey on behalf of all
persons (the "Class") who purchased the securities of Majesco
Entertainment Co. (Nasdaq: COOL) ("Majesco" or the "Company")
during the period December 8, 2004 and July 12, 2005 (the "Class
Period").
The Complaint charges Majesco, a producer of video games, and
its former CEO, Carl Yankowski, and its former CFO, Jan E.
Chasen ("Defendants"), with violations of Sections 10(b) and
20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of materially false
and misleading statements to the market throughout the Class
Period that had the effect of artificially inflating the market
price of the Company's securities. The Complaint alleges that,
throughout the Class Period, Defendants touted the
diversification of Majesco's product line and stated that the
Company's revenue and income would significantly increase in
fiscal year 2005. Unbeknownst to investors, Majesco's claimed
increase in revenue and income was unreasonable because it would
disproportionately depend on the success of just one of its
video games, and on the Company's continued improper accounting
for development costs.
The truth began to emerge on July 12, 2005, when Majesco issued
a press release after the market closed announcing a dramatic
reduction in its anticipated 2005 results. Rather than the
expected net revenues of $175-$185 million and income of $16-$18
million, the Company now stated it expected a loss of $16-$19
million on revenues that would be at least $50 million lower
than previously announced. Majesco also announced that, after
less than a year, Yankowski had resigned as CEO and Chasen had
been removed as CFO. On this news, the price of Majesco stock
dropped drastically, falling 48%, from $6.89 per share on July
12, 2005 to $3.56 per share on July 13, 2005.
For more details, contact James E. Miller, Esq. or James C.
Shah, Esq. of Shepherd, Finkelman, Miller & Shah, LLC, Phone:
+1-866-540-5505 or +1-877-891-9880, E-mail:
jmiller@classactioncounsel.com or jshah@classactioncounsel.com.
MAJESCO ENTERTAINMENT: Schiffrin & Barroway Lodges Suit in NJ
-------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit in the United States District Court for the
District of New Jersey on behalf of all securities purchasers of
Majesco Entertainment Company (f/k/a Majesco Holdings Inc.)
("Majesco" or the "Company") (Nasdaq: COOL) between December 8,
2004 and July 12, 2005 inclusive (the "Class Period").
The complaint charges Majesco, Carl J. Yankowski, Morris Sutton,
Jesse Sutton, and Jan E. Chason 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's transition from a narrow focused
gadget video game company to a diversified video game
company with premium frontline publishing was off
track;
(2) that the Company, contrary to its express
representations, was experiencing generally weak
consumer demand and had high retail inventory;
(3) that the Company had to take write-downs of receivables
as a result of a recent bankruptcy of one of its
customers;
(4) that the Company's relationships with retailers were
weak;
(5) that the launch of the Company's Game Boy Advance
products had been delayed; and
(6) that as a consequence of the foregoing, defendants'
positive statements about the Company's growth and
progress lacked in any reasonable basis when made.
On July 12, 2005, Majesco drastically lowered its guidance for
its fiscal year 2005. Additionally, the Company announced that
its Chief Executive Officer, Carl Yankowski, had resigned his
position. This news shocked the market. Shares of Majesco fell
$3.33 per share, or 48.33 percent, on unusually high volume, on
July 13, 2005, to close at $3.56 per share.
For more details, contact Marc A. Topaz, Esq. or Darren J.
Check, Esq. of Schiffrin & Barroway, LLP, 280 King of Prussia
Road, Radnor, PA, 19087, Phone: 1-888-299-7706 or
1-610-667-7706, E-mail: info@sbclasslaw.com, Web site:
http://www.sbclasslaw.com.
RAMP CORPORATION: Abraham Fruchter Lodges Securities Suit in NY
---------------------------------------------------------------
The law firm of Abraham Fruchter & Twersky LLP announces that a
securities fraud class action lawsuit was filed on July 19, 2005
on behalf of all persons who purchased the securities of Ramp
Corporation ("Ramp" or the "Company") (OTC: RCOCQ) during the
period from April 14, 2004 to May 20, 2005, inclusive (the
"Class Period").
The lawsuit, entitled Silverlake Holdings, Inc. v. Andrew Brown,
et al., is pending before the Honorable Denise Cote in the
United States District Court for the Southern District of New
York, Case No. 05 CV 6521 (DC). It names as defendants, Andrew
Brown, who was the Company's Chief Executive Officer (CEO),
Chairman of the Board and President until May 22, 2005 when he
resigned as Chairman and was suspended as President and CEO; Ron
Munkittrick, who has been Chief Financial Officer (CFO) of Ramp
since October 12, 2004; Darryl R. Cohen, who was CEO and
Chairman of the Board of Ramp at the start of the Class Period
until April 25, 2004; Mitchell Cohen, who was CFO of Ramp from
the start of the Class Period until September 8, 2004; and BDO
Seidman LLP ("Seidman"), an accounting firm, which performed
audits for the Company for the years ended December 31, 2004 and
December 31, 2003.
The complaint alleges that the Defendants violated Sections
10(b) and 20(a) of the Securities Exchange Act of 1934 by making
materially false and misleading representations and omissions in
public filings with the Securities and Exchange Commission. The
complaint alleges that on May 21, 2005, Seidman resigned as the
Company's auditor and advised Ramp that the Company's 2003 and
2004 audit reports were unreliable. The complaint further
alleges that as a result of such information, Ramp stated that
is would not file its quarterly report on Form 10-Q for the
quarter ended March 31, 2005 on time, which led to its
defaulting on certain debentures. It is also alleged in the
complaint that Defendant Brown resigned and was suspended on May
22, 2005 because he may have violated Company policies or the
law when he received an unspecified amount of cash as a gift in
December 2003. The complaint alleges that the Company filed for
reorganization under Chapter 11 of the Bankruptcy laws on June
2, 2005, and that the American Stock Exchange notified it on
June 6, 2005 that it was delisting the Company's stock.
It is alleged that when Seidman announced that it was resigning
and that Ramp's financial statements were unreliable, trading in
the Company's stock was halted on May 23, 2005. At the time,
Ramp's stock was trading at $1.25 per share. When the Company's
stock began trading again, it decreased in price to $0.10 per
share.
For more details, contact Jeffrey S. Abraham, Esq. or Lawrence
D. Levit, Esq. of Abraham Fruchter & Twersky LLP, One Penn
Plaza, Suite 2805, New York, NY, 10119, Phone: (212) 279-5050 or
(800) 440-8986, Fax: (212) 279-3655, E-mail: Jabraham@aftlaw.com
or Llevit@aftlaw.com.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA. Glenn Ruel Senorin, Aurora Fatima Antonio and Lyndsey
Resnick, Editors.
Copyright 2005. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
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