/raid1/www/Hosts/bankrupt/CAR_Public/051114.mbx
C L A S S A C T I O N R E P O R T E R
Monday, November 14, 2005, Vol. 7, No. 225
Headlines
AMERICAN GREETINGS: Recalls 14.2T Fairy Wands Due to Injury Risk
ANTIGENICS INC.: NY Court Preliminarily Approves Suit Settlement
AVICI SYSTEMS: NY Court Preliminarily Approves Suit Settlement
BANK OF AMERICA: Gets Federal Subpoenas, Faces Refco Lawsuits
BARR LABORATORIES: FTC Sues To End Anti-competitive Practices
CHECKPOINT SYSTEMS: Continues To Face Antitrust Suits in PA, NJ
CINCINNATI INSURANCE: County Judge Dismisses Chiropractor's Suit
CIT GROUP: Seeks Decertification For NJ Consumer Fraud Lawsuit
FIFTH THIRD: OH Court Mulls Approval For Securities Settlement
FMC CORPORATION: Faces Hydrogen Peroxide Antitrust Litigation
GENERAL NUTRITION: Continues To Face Pro-Hormone Product Suits
GENERAL NUTRITION: Reaches Settlement For False Labeling Suits
JOURNAL SENTINEL: WI Court Partially Dismisses Advertisers' Suit
LOUISIANA: Law Firm, Legal Groups File Suit Over Katrina Relief
MAKITA U.S.A.: Recalls 1,500 Angle Grinders Due to Injury Hazard
MCDONALD'S CORPORATION: Plaintiffs File Amended Suit in N.D. IL
MCMORAN EXPLORATION: Investor Suit Trial Reset To May 2006 in DE
MEDICAL STAFFING: FL Court Dismiss in Part Securities Fraud Suit
MICHIGAN: Attorneys Seeks Expansion of Class in Inmate Lawsuit
MIDAMERICAN ENERGY: NY Court Grants Certification To Fraud Suit
MOLEX INC.: Shareholders Commence Securities Fraud Litigation
MOLSON COORS: Faces Securities, ERISA Lawsuits in Various Courts
MONSANTO CO.: WV Dioxin Suits Moved Back to Putnam County Court
MPOWER HOLDING: Continues To Face Labor Violations Lawsuit in CA
MYLAN LABORATORIES: Plaintiffs Withdraw PA Securities Fraud Suit
NATURAL PRODUCTS: Enters FTC Consent Agreement For False Claims
NICOR INC.: Consumer Fraud Suit Moved To Dupage County, IL Court
NICOR GAS: Working On Settlement of IL Mercury Injury Litigation
NICOR GAS: IL Property Owners Launch Suit V. Oak Park Facility
NISOURCE INC.: Trial in Gas Royalty Lawsuit Moved To 1st Q 2006
ON SEMICONDUCTOR: NY Court Preliminarily OKs Lawsuit Settlement
PATINA OIL: CO Court Grants Certification To Gas Royalties Suit
PENNSYLVANIA: School District to Comply with Gaskin Settlement
QUANTUM CORPORATION: Faces DLT Tape Antitrust Suit Filed in CA
STEWART FINANCE: Settles FTC Deceptive Trade Practices Lawsuit
SUNRISE POWER: CA Court Sustains Demurrer in Unfair Trade Suit
TYCO INTERNATIONAL: Meites Mulder Expands Suit Investigation
TYSON FOODS: Supreme Court Ruling Favors WA Plant's Meat Packers
WESTAR ENERGY: KS Court Approves Securities Lawsuit Settlement
WESTAR ENERGY: Re-enters Mediation For KS ERISA Suit Settlement
WHOLESALE CONNECTION: IL Businessman Sues Over Unsolicited Faxes
WORLD KITCHEN: Recalls 472T Immersion Heaters Due to Shock Risk
WORTHINGTON FOODS: Recalls Patties Due to Undeclared Egg, Milk
New Securities Fraud Cases
BLOCKBUSTER INC.: Milberg Weiss Files Securities Suit in N.D. TX
BLOCKBUSTER INC.: Schatz & Nobel Lodges Securities Suit in TX
HCA INC.: Charles Piven Lodges Securities Fraud Suit in M.D. TN
HCA INC.: Marc S. Henzel Lodges Securities Fraud Suit in M.D. TN
HCA INC.: Stull Stull Lodges Securities Fraud Suit in M.D. TN
PEGASUS COMMUNICATIONS: Marc Henzel Lodges Securities Suit in PA
PIXAR ANIMATION: Glancy Binkow Files Securities Fraud Suit in CA
*********
AMERICAN GREETINGS: Recalls 14.2T Fairy Wands Due to Injury Risk
----------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), American Greetings Corporation, of Cleveland, Ohio is
voluntarily recalling about 14,200 packages containing four
wands each of DesignWarer 4 Fairy Wands.
According to the companies, the fairy wand party favors can
break apart, exposing sharp wires that pose a laceration hazard
to children. No injuries have been reported. The recalled fairy
wands are pink or purple with multi-colored beads, feathers and
ribbons. The wands are 7-inches long. There are four wands in
each package. The packaging has a light pink cardboard backer.
Model number WAND1361 is written on the back of the packaging.
Manufactured in China, the wands were sold at all discount, toy,
drug, grocery, party and specialty gift stores nationwide from
March 2003 through September 2005 for about $4.
Consumers should take the recalled wands away from young
children immediately. Contact the firm for a coupon redeemable
wherever American Greetings products are sold. Consumer
Contact: For additional information, contact American Greetings
at (800) 777-4891 between 8 a.m. and 5 p.m. ET Monday through
Friday, or visit the firm's Web site:
http://americangreetings.com.
ANTIGENICS INC.: NY Court Preliminarily Approves Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Antigenics,
Inc., its Chairman and Chief Executive Officer Garo Armen, and
two investment banking firms that served as underwriters in its
initial public offering. The suit was filed behalf of a class
of purchasers of its stock between February 3, 2000 and December
6, 2000.
Similar complaints were filed against about 300 other issuers,
their underwriters, and in many instances directors and
officers. These cases have been coordinated under the caption
"In re Initial Public Offering Securities Litigation, Civ. No.
21 MC 92 (SAS)," by order dated August 9, 2001.
The suit against the Company and Dr. Armen alleges that the
brokerage arms of the investment banking firms charged secret
excessive commissions to certain of their customers in return
for allocations of our stock in the offering. The suit also
alleges that shares of the Company's stock were allocated to
certain of the investment banking firms' customers based upon
agreements by such customers to purchase additional shares of
the Company's stock in the secondary market. The complaint
alleges that the Company is liable under Section 11 of the
Securities Act of 1933, as amended, and Dr. Armen is liable
under Sections 11 and 15 of the Securities Act because its
registration statement did not disclose these alleged practices.
On April 19, 2002, the plaintiffs in this action filed an
amended class action complaint, which contains new allegations.
Similar amended complaints were filed with respect to about 300
companies. In addition to the claims in the earlier complaint,
the amended complaint alleged that the Company and Dr. Armen
violated Sections 10(b) and 20 of the Securities Exchange Act
and SEC Rule 10b-5 by making false and misleading statements
and/or omissions in order to inflate stock price and conceal the
investment banking firms' alleged secret arrangements. The
claims against Dr. Armen, in his individual capacity, have been
dismissed without prejudice.
On July 15, 2002, the Company and Dr. Armen joined the Issuer
Defendants' Motion to Dismiss the Consolidated Amended
Complaints. By order of the Court, this motion set forth all
"common issues," i.e., "all grounds for dismissal common to all
or a significant number of Issuer Defendants." The hearing on
the Issuer Defendant's Motion to Dismiss and the other
Defendants' motions to Dismiss was held on November 1, 2002. On
February 19, 2003, the Court issued its opinion and order on the
Issuer Defendants' Motion to Dismiss. The Court granted the
Company's motion to dismiss the Rule 10b-5 and Section 20 claims
with leave to amend and denied its motion to dismiss the Section
11 and Section 15 claims. In June 2003, a proposed settlement
of this litigation was structured between the plaintiffs, the
issuer defendants in the consolidated actions, the issuer
officers and directors named as defendants, and the issuers'
insurance companies. The settlement would provide, among other
things, a release for the Company and for the individual
defendants for the conduct alleged to be wrongful in the amended
complaint. The Company would agree to undertake other
responsibilities under the partial settlement, including
agreeing to assign away, not assert, or release certain
potential claims us that may have against our underwriters. Any
direct financial impact of the proposed settlement is expected
to be borne by its insurance carriers.
In June 2004, an agreement of settlement was submitted to the
Court for preliminary approval. The court requested that any
objections to preliminary approval of the settlement be
submitted by July 14, 2004, and the underwriter defendants
formally objected to the settlement. The plaintiffs and issuer
defendants separately filed replies to the underwriter
defendants' objections to the settlement on August 4, 2004. The
court granted the preliminary approval motion on February 15,
2005, subject to certain modifications. The parties are
directed to report back to the court regarding the
modifications. If the parties are able to agree upon the
required modifications, and such modifications are acceptable to
the court, notice will be given to all class members of
settlement, a "fairness" hearing will be held and if the Court
determines that the settlement is fair to the class members, the
settlement will be approved. There can be no assurance that this
proposed settlement would be approved and implemented in its
current form, or at all.
On September 1, 2005, the Court preliminarily approved the
proposed settlement, directed that notice of the terms of the
proposed settlement be provided to class members, and scheduled
a fairness hearing, at which objections to the proposed
settlement will be heard. Thereafter, the Court will determine
whether to grant final approval to the proposed settlement.
The suit is styled "IN RE ANTIGENICS INC. INITIAL PUBLIC
OFFERING SECURITIES LITIGATION," filed in relation to "IN RE
INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File No.
21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. Scheindlin. The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(3) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(6) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
AVICI SYSTEMS: NY Court Preliminarily Approves Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York preliminarily approved the revised settlement of the
securities class action filed against Avici Systems, Inc., one
or more of its underwriters of its initial public offering (IPO)
and certain of its officers and directors.
Twelve purported securities class action lawsuits were initially
filed, alleging violations of the federal securities laws,
namely:
(1) Felzen, et al. v. Avici Systems Inc., et al., C.A. No.
01-CV-3363;
(2) Lefkowitz, et al. v. Avici Systems Inc., et al., C.A.
No. 01-CV-3541;
(3) Lewis, et al. v. Avici Systems Inc., et al., C.A. No.
01-CV-3698;
(4) Mandel, et. al v. Avici Systems Inc., et al., C.A. No.
01-CV-3713;
(5) Minai, et al. v. Avici Systems Inc., et al., C.A. No.
01-CV-3870;
(6) Steinberg, et al. v. Avici Systems Inc., et al., C.A.
No. 01-CV-3983;
(7) Pelissier, et al. v. Avici Systems Inc., et al., C.A.
No. 01-CV-4204;
(8) Esther, et al. v. Avici Systems Inc., et al., C.A. No.
01-CV-4352;
(9) Zhous, et al. v. Avici Systems Inc. et al., C.A. No.
01-CV-4494;
(10) Mammen, et al. v. Avici Systems Inc., et. al., C.A. No.
01-CV-5722;
(11) Lin, et al. v. Avici Systems Inc., et al., C.A. No. 01-
CV-5674; and
(12) Shives, et al. v. Banc of America Securities, et al.,
C.A. No. 01-CV-4956.
On April 19, 2002, a consolidated amended class action
complaint, which superseded these twelve purported securities
class action lawsuits, was filed in the Court. The Complaint is
captioned "In re Avici Systems, Inc. Initial Public Offering
Securities Litigation (21 MC 92, 01 Civ. 3363 (SAS)" and names
as defendants the Company, certain of the underwriters of its
initial public offering, and certain of its officers and
directors.
The Complaint, which seeks unspecified damages, alleges
violations of the federal securities laws, including among other
things, that the underwriters of the Company's initial public
offering improperly required their customers to pay the
underwriters excessive commissions and to agree to buy
additional shares of Company stock in the aftermarket as
conditions of receiving shares in the Company's IPO. The
Complaint further claims that these supposed practices of the
underwriters should have been disclosed in the IPO prospectus
and registration statement.
In addition to the Complaint against the Company, various other
plaintiffs have filed other substantially similar class action
cases against approximately 300 other publicly traded companies
and their IPO underwriters in New York City, which along with
the case against the Company have all been transferred to a
single federal district judge for purposes of case management.
On July 15, 2002, the Company, together with the other issuers
named as defendants in these coordinated proceedings, filed a
collective motion to dismiss the consolidated amended complaints
against them on various legal grounds common to all or most of
the issuer defendants. On October 9, 2002, the Court dismissed
without prejudice all claims against the individual current and
former officers and directors who were named as defendants in
the Company litigation, and they are no longer parties to the
lawsuit. On February 19, 2003, the Court issued its ruling on
the motions to dismiss filed by the issuer defendants and
separate motions to dismiss filed by the underwriter defendants.
In that ruling, the Court granted in part and denied in part
those motions.
As to the claims brought against Avici under the antifraud
provisions of the securities laws, the Court dismissed all of
these claims with prejudice, and refused to allow the plaintiffs
an opportunity to re-plead these claims against the Company. As
to the claims brought under the registration provisions of the
securities laws, which do not require that intent to defraud be
pleaded, the Court denied the motion to dismiss these claims as
to the Company and as to substantially all of the other issuer
defendants as well. The Court also denied the underwriter
defendants' motion to dismiss in all respects.
In June 2003, the Company elected to participate in a proposed
settlement agreement with the plaintiffs in this litigation. If
ultimately approved by the Court, this proposed settlement would
result in the dismissal, with prejudice, of all claims in the
litigation against the Company and against any of the other
issuer defendants who elect to participate in the proposed
settlement, together with the current or former officers and
directors of participating issuers who were named as individual
defendants. The proposed settlement does not provide for the
resolution of any claims against the underwriter defendants, and
the litigation as against those defendants is continuing. The
proposed settlement provides that the class members in the class
action cases brought against the participating issuer defendants
will be guaranteed a recovery of $1 billion by insurers of the
participating issuer defendants. If recoveries totaling $1
billion or more are obtained by the class members from the
underwriter defendants, however, the monetary obligations to the
class members under the proposed settlement will be satisfied.
In addition, the Company and any other participating issuer
defendants will be required to assign to the class members
certain claims that they may have against the underwriters of
their IPOs.
The proposed settlement contemplates that any amounts necessary
to fund the settlement or settlement-related expenses would come
from participating issuers' directors and officers liability
insurance policy proceeds as opposed to funds of the
participating issuer defendants themselves. A participating
issuer defendant could be required to contribute to the costs of
the settlement if that issuer's insurance coverage were
insufficient to pay that issuer's allocable share of the
settlement costs.
Consummation of the proposed settlement is conditioned upon
obtaining both preliminary and final approval by the Court.
Formal settlement documents were submitted to the Court in June
2004, together with a motion asking the Court to preliminarily
approve the form of settlement. Certain underwriters who were
named as defendants in the settling cases, and who are not
parties to the proposed settlement, opposed preliminary approval
of the proposed settlement of those cases. On February 15,
2005, the Court issued an order preliminarily approving the
proposed settlement in all respects but one. In response to
this order, the plaintiffs and the issuer defendants are in the
process of submitting revised settlement documents to the Court.
The underwriter defendants may object to the revised settlement
documents. If the Court approves the revised settlement
documents, it will direct that notice of the terms of the
proposed settlement be published in a newspaper and on the
internet and mailed to all proposed class members. It will also
schedule a fairness hearing, at which objections to the proposed
settlement will be heard. Thereafter, the Court will determine
whether to grant final approval to the proposed settlement.
Consummation of the proposed settlement is conditioned upon
obtaining approval by the Court. On September 1, 2005, the
Court preliminarily approved the proposed settlement, directed
that notice of the terms of the proposed settlement be provided
to class members, and scheduled a fairness hearing, at which
objections to the proposed settlement will be heard. Thereafter,
the Court will determine whether to grant final approval to the
proposed settlement.
The suit is styled "In re Avici Systems, Inc. Securities
Litigation," related to "In re Initial Public Offering
Securities Litigation, 21-MC-92 (Sas)," filed in the United
States District Court for the Southern District of New York,
under Judge Shira A. Scheindlin. The plaintiff firms in this
litigation are:
(i) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(ii) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(iii) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(iv) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(v) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(vi) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, newyork@whafh.com
BANK OF AMERICA: Gets Federal Subpoenas, Faces Refco Lawsuits
-------------------------------------------------------------
Bank of America Corporation received regulatory inquiries as
part of probes into the collapse of commodities and futures
brokerage Refco Inc., The Akron Beacon Journal reports
The Charlotte-based bank, which has received subpoenas, was one
of the lead underwriters in the $583 million initial public
offering last August by Refco. That company filed for bankruptcy
protection October 17 after its former chief executive was
charged with securities fraud. The bank also disclosed that was
named as a defendant in a number of class action lawsuits that
alleges Refco underwriters violated securities laws in the IPO.
That complaints seek unspecified damages.
BARR LABORATORIES: FTC Sues To End Anti-competitive Practices
-------------------------------------------------------------
The Federal Trade Commission filed a complaint in federal
district court seeking to put an end to an agreement between
drug manufacturers Galen Chemicals Ltd. (now known as Warner
Chilcott) and Barr Laboratories (Barr) that is denying consumers
the choice of a lower-priced generic version of Warner
Chilcott's Ovconr oral contraceptive.
According to the FTC's complaint, Barr planned to launch a
generic version of Ovcon as soon it received regulatory approval
from the Food and Drug Administration (FDA). Warner Chilcott
expected to lose half its Ovcon sales within the first year if
Ovcon faced competition from a generic equivalent. Faced with
this prospect, instead of competing with Barr, Warner Chilcott
entered into an agreement with Barr preventing entry of Barr's
generic Ovcon into the United States for five years. In exchange
for Barr's promise not to compete, Warner Chilcott paid Barr $20
million.
"The agreement between Warner Chilcott and Barr is a naked
agreement not to compete and to share the resulting profits
between a branded drug seller and its only prospective generic
competitor," said FTC Chairman Deborah Platt Majoras. "When
firms agree to eliminate competition without plausible
justification, the Commission will step in to protect
consumers."
In January 2000, Warner Chilcott acquired Ovcon 35, a branded
oral contraceptive, from Bristol-Myers Squibb (BMS). Ovcon is
not subject to any patent protection. As part of the
acquisition, BMS agreed to provide Ovcon to Warner Chilcott.
According to the complaint, Galen's sales of Ovcon more than
doubled since 2000, and the drug was one of the company's
largest sellers by 2004.
The complaint alleges that in September 2001, Barr filed an
application with the FDA for approval to make and sell a generic
version of Ovcon. Barr planned to sell generic Ovcon at a 30
percent discount to the branded product. In January 2003, Barr
publicly announced its intention to market generic Ovcon by the
end of that year. Generic Ovcon entry was understood by Warner
Chilcott to be the "biggest risk to the company," the complaint
alleges. Warner Chilcott expected that Barr's generic Ovcon
would capture at least 50 percent of Ovcon's new prescriptions
within the first year, thus causing a significant decline in
Ovcon revenues.
To protect these revenues from generic competition, Warner
Chilcott intended to introduce a chewable form of the product
(Ovcon Chewable) before generic entry occurred. Warner
Chilcott's strategy, the complaint states, was to convert its
Ovcon customers to Ovcon Chewable and to stop selling Ovcon.
Prescriptions for Ovcon Chewable could not be replaced at the
pharmacy with generic Ovcon without express approval of the
patient's physician.
According to the FTC, by mid-2003, Warner Chilcott's switch
strategy to protect its Ovcon revenues - by converting customers
to Ovcon Chewable before generic Ovcon entry - was in jeopardy.
Barr's generic Ovcon entry appeared imminent, and Ovcon Chewable
had not obtained FDA approval. Facing the imminent threat of
generic Ovcon entry, the complaint alleges, Warner Chilcott, in
September 2003, entered into an agreement in principle with
Barr. Under this agreement, after Barr received final FDA
approval for its generic Ovcon product, Warner Chilcott would
have the option to pay Barr a total of $20 million. In return
for this payment, the complaint alleges, Barr would not compete
in the United States for five years with its generic Ovcon
product. Instead of entering and competing, alleges the FTC,
Barr would agree to be available as a second supplier of Ovcon
to Warner Chilcott if Warner Chilcott so requested.
The complaint alleges that Warner Chilcott and Barr carried out
their horizontal agreement not to compete. In April 2004, Barr
received FDA approval to make and sell generic Ovcon. Several
weeks later, Warner Chilcott paid Barr the money owed under the
agreement. As a result, Barr is precluded from entering with its
own generic Ovcon product until May 2009.
The Commission's complaint charges that defendants' horizontal
agreement not to compete, which prevents entry of Barr's generic
version of Ovcon for five years, constitutes an unfair method of
competition in violation of Section 5 of the FTC Act. According
to the complaint, the agreement on its face eliminates
competition, has no plausible justification, and thus is a naked
restraint of trade.
The Commission vote authorizing the staff to file the complaint
was 4-0. The complaint was filed in the U.S. District Court for
the District of Columbia under Section 13(b) of the FTC Act on
November 7, 2005. The Commission seeks permanent injunctive
relief to undo the provision in the Warner Chilcott-Barr
agreement prohibiting Barr from selling a generic version of
Ovcon, with the goal of facilitating the prompt introduction of
a generic version of Ovcon into the United States. Twenty-one
states and the District of Columbia also have filed a complaint
in the same court challenging the agreement. In addition to
injunctive relief, the states will be seeking disgorgement and
civil penalties.
Copies of the complaint will be available shortly from the FTC's
Web site at http://www.ftc.govand also from the FTC's Consumer
Response Center, Room 130, 600 Pennsylvania Avenue, N.W.,
Washington, DC 20580. The FTC's Bureau of Competition seeks to
prevent business practices that restrain competition. The Bureau
carries out its mission by investigating alleged law violations
and, when appropriate, recommending that the Commission take
formal enforcement action. To notify the Bureau concerning
particular business practices, call or write the Office of
Policy and Coordination, Room 394, Bureau of Competition,
Federal Trade Commission, 600 Pennsylvania Ave, N.W.,
Washington, DC 20580, Electronic Mail: antitrust@ftc.gov;
Telephone (202) 326-3300. For more information on the laws that
the Bureau enforces, the Commission has published "Promoting
Competition, Protecting Consumers: A Plain English Guide to
Antitrust Laws," which can be accessed at
http://www.ftc.gov/bc/compguide/index.htm. For more details,
contact Mitchell J. Katz, Office of Public Affairs by Phone:
202-326-2161 or Bradley S. Albert, Bureau of Competition,
by Phone: 202-326-3670 or visit the Website:
http://www.ftc.gov/opa/2005/11/galenbarr.htm.
CHECKPOINT SYSTEMS: Continues To Face Antitrust Suits in PA, NJ
---------------------------------------------------------------
Checkpoint Systems, Inc. continues to face several class actions
filed in in connection with the jury decision in the ID Security
Systems Canada Inc. litigation. The purported class action
complaints generally allege a claim of monopolization and are
substantially based upon the same allegations as contained in
the ID Security Systems Canada Inc. case (Civil Action No. 99-
CV-577).
On August 1, 2004, the Company and ID Security Systems Canada
Inc. entered into a settlement agreement effective July 30,
2004, pursuant to which the Company agreed to pay $19.95
million, in full and final settlement of the claims covered by
the litigation. This settlement was accrued in the second
quarter of 2004. Payment in full was made on August 5, 2004.
On August 1, 2002, a civil action was filed in United States
District Court for the Eastern District of Pennsylvania,
designated as Civil Action No. 02-6379(ER) by plaintiff Diane
Furs, Inc. t/a Diane Furs against Checkpoint Systems, Inc. and
served on August 21, 2002. On August 21, 2002, a Notice of
Substitution of Plaintiff and Filing of Amended Complaint was
filed by the plaintiff, and the named plaintiff was changed to
Medi-Care Pharmacy, Inc.
On August 2, 2002, a civil action was filed in the United States
District Court, District of New Jersey (Camden) designated as
Docket No. 02-CV-3730(JEI) by plaintiff Club Sports
International, Inc., d/b/a Soccer CSI against Checkpoint
Systems, Inc. and served on August 26, 2002.
On October 2, 2002, a civil action was filed in the United
States District Court, District of New Jersey (Camden)
designated as Docket No. 02-CV-4777(JBS) by plaintiff Baby Mika,
Inc. against Checkpoint Systems, Inc. and served on October 7,
2002.
On October 23, 2002, a civil action was filed in the United
States District Court, District of New Jersey (Camden)
designated as Docket No. 02-CV-5001(JEI) by plaintiff Washington
Square Pharmacy, Inc. against Checkpoint Systems, Inc. and
served on November 1, 2002. On October 18, 2002, The United
States District, District of New Jersey (Camden) entered an
Order staying the proceedings in the Club Sports International,
Inc. and Baby Mika, Inc. cases referred to above. In accordance
with the Order, the Stay will also apply to the Washington
Square Pharmacy, Inc. case referred to above. In addition, the
Medi-Care Pharmacy, Inc. case, referred to above, will be
voluntarily dismissed, and it has been re-filed in New Jersey
and is included in the Stay Order. As a result of the
settlement of the litigation with ID Security Systems Canada
Inc. described above, an application can be made to the Court to
dissolve the Stay Order at this time.
On November 13, 2002, a civil action was filed in the United
States District Court, District of New Jersey (Camden)
designated as Docket No. 02-CV-5319(JEI) by plaintiff 1700
Pharmacy, Inc. against Checkpoint Systems, Inc. and served on
November 15, 2002.
On December 30, 2002, a civil action was filed in the United
States District Court, District of New Jersey (Camden)
designated as Docket No. 02-CV-6131(JEI) by plaintiff Medi-Care
Pharmacy, Inc. against Checkpoint Systems, Inc. and served on
January 3, 2003.
Both the 1700 Pharmacy, Inc. case and the Medi-Care Pharmacy,
Inc. case were consolidated with the previously mentioned cases
and are included in the October 18, 2002 Stay Order referred to
above.
CINCINNATI INSURANCE: County Judge Dismisses Chiropractor's Suit
----------------------------------------------------------------
Madison County Circuit Judge George Moran of Illinois dismissed
a proposed class action suit that chiropractor Frank Bemis filed
in February against Cincinnati Insurance, The Madison County
Record reports.
The ruling came thirty-six days after a motion to dismiss
hearing was held. Judge Moran based his decision on Cincinnati's
argument that Mr. Bemis tried to fit a square peg in a round
hole. Mr. Bemis, who was represented by the Lakin Law Firm in
Wood River, Illinois, launched the suit against Cincinnati
claiming that it improperly reduced payment for his treatment of
a patient, Mr. Stanley, under a workers' compensation policy.
His lawyers alleged consumer fraud, civil conspiracy and unjust
enrichment and thus moved to certify Mr. Bemis as representative
of plaintiffs in 31 states. In March, Cincinnati moved to have
the case dismissed.
Brad Lakin and Jeffrey Millar of the Lakin firm, which were
designated as lead counsels for the proposed class by Madison
County Circuit Judge Daniel Stack, opposed the motion. They
pointed out that Mr. Bemis signed a contract with a company,
Corvel, to steer patients to him in exchange for discounted
rates. Additionally, they wrote in a response to insurer's
motion that Corvel and Cincinnati signed a contract under which
Cincinnati could pay discounted rates in return for steering
patients to Bemis. The attorneys claimed that Cincinnati took
the discounts but did not steer the patients.
Replying in a May 9 memorandum, Cincinnati Insurance attorney
George Smyrinotis of Chicago, argued that Mr. Bemis had no
contract with Cincinnati. He pointed out, "Simply stated,
Cincinnati does not have any obligations to Bemis to pay him any
amount whatsoever for any chiropractic treatment." He also
argued that jurisdiction belonged with the Illinois Industrial
Commission. He also contends, "The only dispute is about the
amount of benefits properly payable. This is exactly the type of
dispute that the commission is exclusively set up to resolve."
The attorney also attacked the attempt to style the suit as a
class action was irrelevant and failed to relieve the commission
of jurisdiction. Mr. Smyrinotis also lambasted Mr. Bemis's
consumer fraud claim by stating, "Mr. Bemis does not allege that
Cincinnati deceived him into treating Mr. Stanley. Mr. Bemis
does not allege that Cincinnati represented to him that it would
pay any part of Stanley's medical bills." He goes on to state,
"At most, Mr. Bemis suggests a difference of opinion about the
value of the treatment rendered to Mr. Stanley. Differences of
opinion are not considered deceptive under Illinois law." With
those arguments, Mr. Smyrinotis contends that Mr. Bemis could
not claim consumer fraud because he was not a consumer.
Additionally, Mr. Smyrinotis also attacked the conspiracy claim,
which alleged that Corvel wrongfully transferred commercial
information about Mr. Bemis to Cincinnati. He wrote, "This is
not wrongful conduct. Rather, it is exactly what Bemis
contracted for with Corvel." He also attacked the unjust
enrichment claim, writing that Mr. Bemis did not allege that any
contract or policy bound Cincinnati to pay any amount. He also
pointed out, "Because Cincinnati did not owe Mr. Bemis any
payment, Cincinnati cannot be deemed to have wrongfully retained
any amount purportedly due Mr. Bemis."
On May 20, Mr. Bemis motioned for a substitute judge, which
Judge Stack granted, and thus Chief Judge Edward Ferguson
assigned the case to Judge Moran.
CIT GROUP: Seeks Decertification For NJ Consumer Fraud Lawsuit
--------------------------------------------------------------
CIT Group, Inc. and other financial institutions asked the
Superior Court of New Jersey, Monmouth County to decertify the
class action filed against them, styled "Exquisite Caterers
Inc., et al. v. Popular Leasing Inc., et al."
The defendants acquired equipment leases ("NorVergence Leases")
from NorVergence, Inc., a reseller of telecommunications and
Internet services to businesses. The suit alleges that
NorVergence misrepresented the capabilities of the equipment
leased to its customers and overcharged for the equipment. The
complaint asserts that the NorVergence Leases are unenforceable
and seeks rescission, punitive damages, treble damages and
attorneys' fees. Plaintiffs filed a motion for reconsideration
of the Court's denial. The court later certified a New Jersey-
only class, and a motion for decertification is pending.
In addition, putative class action suits in Florida, Illinois,
New York and Texas and several individual suits, all based upon
the same core allegations and seeking the same relief, were
filed by NorVergence customers against the Company and other
financial institutions. Thereafter, the putative class action
suits in Florida and New York and one of the putative class
action suits in Illinois were dismissed as to the Company,
leaving pending putative class action suits in Illinois and
Texas.
FIFTH THIRD: OH Court Mulls Approval For Securities Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
Ohio has yet to rule on the approval of the settlement for the
consolidated securities class action filed against it and
certain of its officers in the United States District Court for
the Southern District of Ohio, alleging violations of federal
securities laws.
The suit relates to disclosures made by the Company regarding
its integration of Old Kent Financial Corporation and its effect
on the Company's infrastructure, including internal controls,
prospects and related matters. The complaint sought
unquantified damages on behalf of putative classes of persons
who purchased the Company's common stock, attorneys' fees and
other expenses.
On March 31, 2005 the Registrant announced that it had settled
this suit. The settlement is subject to court approval. Under
the proposal, a settlement fund of $17 million plus interest,
but minus lawyers' fees and expenses would be established. The
proposal further said that the settlement would be divided among
investors who bought Fifth Third Bancorp stock between September
21, 2001 and January 31, 2003. Lawyers' fees would be limited to
a maximum of 28 percent of the fund plus about $300,000 for
expenses, according to a proposed order submitted for court
approval, an earlier Class Action Reporter story (April 4,2005)
reports.
The amount to which any investor would be entitled would depend
on how many investors sign up for the settlement, the number of
Fifth Third shares they bought and how much they paid for those
shares. The plaintiffs' lawyers estimated that 116 million
shares were traded during the class period and that the average
amount recovered per share would be 14.6 cents. Individual
investors could reject the settlement and pursue actions on
their own, the lawyers added. Under terms of the proposed
settlement, the Company and the other defendants don't admit to
the validity of any claims made by the plaintiffs.
FMC CORPORATION: Faces Hydrogen Peroxide Antitrust Litigation
-------------------------------------------------------------
FMC Corporation and other U.S. hydrogen peroxide producers face
several antitrust class actions filed in various federal and
state courts, alleging violations of antitrust laws.
On January 28, 2005, the Company and its wholly owned subsidiary
Foret received a Statement of Objections from the European
Commission concerning alleged violations of competition law in
the hydrogen peroxide business in Europe during the period 1994
to 2001. All of the significant European hydrogen peroxide
producers also received the Statement of Objections. The
Company and Foret responded to the Statement of Objections in
April 2005 and a hearing on the matter was held at the end of
June 2005. The Company also received a subpoena for documents
from a grand jury sitting in the Northern District of
California, which is investigating anticompetitive conduct in
the hydrogen peroxide business in the United States during the
period 1994 through 2003.
In connection with these two matters, in February 2005 putative
class action complaints were filed. Federal law provides that
persons who have been injured by violations of federal anti-
trust law may recover three times their actual damage plus
attorney fees. Related cases were also filed in various state
courts. All of the federal court cases were consolidated in the
United States District Court for the Eastern District of
Pennsylvania (Philadelphia). Most of the state court cases have
been dismissed, although some remain in California. In
addition, putative class actions have been filed in provincial
courts in Ontario, Quebec and British Columbia under the laws of
Canada.
GENERAL NUTRITION: Continues To Face Pro-Hormone Product Suits
--------------------------------------------------------------
General Nutrition Companies, Inc. and various manufacturers of
products containing pro-hormones, including androstenedione,
face five substantially identical suits filed in the state
courts of the States of Florida, New York, New Jersey,
Pennsylvania and Illinois. The suits are styled:
(1) Brown v. General Nutrition Companies, Inc., Case No.
02-14221-AB, Florida Circuit Court for the 15th
Judicial Circuit Court, Palm Beach County;
(2) Rodriguez v. General Nutrition Companies, Inc., Index
No. 02/126277, New York Supreme Court, County of New
York, Commercial Division;
(3) Abrams v. General Nutrition Companies, Inc., Docket No.
L-3789-02, New Jersey Superior Court, Mercer County;
(4) Toth v. Bodyonics, Ltd., Case No. 003886, Pennsylvania
Court of Common Pleas, Philadelphia County; and
(5) Pio v. General Nutrition Companies, Inc., Case No. 2-
CH-14122, Illinois Circuit Court, Cook County
On March 20, 2004, a similar lawsuit was filed in California
(Guzman v. General Nutrition Companies, Inc., Case No. 04-
00283).
Plaintiffs allege that the defendants distributed or published
periodicals that contain advertisements claiming that the
various pro-hormone products promote muscle growth. The
complaints allege that the Company knew the advertisements and
label claims promoting muscle growth were false, but nonetheless
continued to sell the products to consumers. Plaintiffs seek
injunctive relief, disgorgement of profits, attorney's fees and
the costs of suit. All of the products involved in the cases
are third-party products. The Company has tendered these cases
to the various manufacturers for defense and indemnification.
GENERAL NUTRITION: Reaches Settlement For False Labeling Suits
--------------------------------------------------------------
General Nutrition Companies, Inc. reached a settlement for the
five class action lawsuits filed against it in the state courts
of Alabama, California, Illinois and Texas with respect to
claims that the labeling, packaging and advertising with respect
to a third-party product sold by the Company were misleading and
deceptive.
As a result of mediation, the parties have agreed in principle
to a settlement of the lawsuits, which is currently in the
process of being finalized. Once finalized, the settlement will
be subject to court approval. Pursuant to the settlement, a
notice to the class will be published in a one-time mass
advertising media publication. Each person that purchased the
third-party product and is part of the class will receive a cash
reimbursement equal to the retail price paid, net of sales tax,
upon presentation to the Company of a cash register receipt as
proof of purchase or, if a receipt is not available, return of
the actual product. If a person purchased the product, but does
not have a cash register receipt or the product itself, such a
person may submit a signed affidavit and will then be entitled
to receive one or more coupons. The number of coupons will be
based on the total amount of purchases of the product subject to
a maximum of five coupons per purchaser. Each coupon will have a
cash value of $10.00 valid toward any purchase of $25.00 or more
at a GNC store. The coupons will not be redeemable by any GNC
Gold Card member during Gold Card Week and will not be
redeemable for products subject to any other price discount.
The coupons are to be redeemed at point of sale and are not
mail-in rebates. They will be redeemable for a 90-day period
after the settlement is final.
The Company will issue a maximum of 5 million certificates with
a combined face value of $50.0 million. Based on its experience
with coupons, the Company believes that the redemption rate will
be approximately 1%. In addition to the cash reimbursements and
coupons, as part of the settlement GNC will be required to pay
legal fees of $1.0& million.
JOURNAL SENTINEL: WI Court Partially Dismisses Advertisers' Suit
----------------------------------------------------------------
The Milwaukee County Circuit Court in Wisconsin granted in part
Journal Sentinel, Inc.'s motion to dismiss a class action filed
in April 2005 against it, alleging it misstated its circulation
numbers.
The plaintiff, Shorewest Realtors, seeks to bring a class action
lawsuit against the Company, which is a subsidiary of Journal
Communications, Inc., on behalf of "Milwaukee Journal Sentinel"
advertisers, alleging that the newspaper improperly inflated its
circulation numbers from 1996 on. Shorewest is seeking
disgorgement or restitution by Journal Sentinel of alleged
improperly collected charges (with interest), plus an
unspecified amount of damages.
The Company filed a motion to dismiss the plaintiffs' claims on
July 20, 2005. On October 10, 2005, the court ruled on the
Amended motion to dismiss. The court dismissed the plaintiffs'
claims based on breach of contract and breach of the duty of
good faith and fair dealing and allowed the plaintiffs to
proceed with their other claims.
LOUISIANA: Law Firm, Legal Groups File Suit Over Katrina Relief
---------------------------------------------------------------
A prominent New York law firm, a Washington-based civil rights
legal organization, and a California not-for-profit legal
organization, together with a Louisiana Law Professor filed a
class action suit in the United States District Court for the
Eastern District of Louisiana to force the Federal Emergency
Management Agency (FEMA) to provide timely aid to victims of
Hurricane Katrina living in Louisiana, Mississippi and Alabama.
The lawsuit, the first file against FEMA in relation to its
response to Katrina, says that the agency has violated and
continues to violate Federal law by failing to discharge its
obligations as the federal agency chartered to care for victims
of natural disasters.
"There is no excuse for this failure by FEMA or for its refusal
to fulfill its mandate," said John C. Brittain of the Lawyers
Committee for Civil Rights Under the Law, the non-profit, civil
rights legal organization that has joined with Schulte Roth as
attorneys for the plaintiffs. "Without judicial oversight along
the lines we have asked the court to provide, there is little
chance that the victimization will cease or that FEMA will come
through with the services it is legally obligated to provide."
The suit seeks a court order to require FEMA to make it easier
for victims to apply for temporary housing assistance, to
improve the agency's outreach and accessibility and immediately
to provide trailers or other alternatives to replace shelters,
tents and other makeshift arrangements. The suit also asks the
court to force FEMA to establish application guidelines under
which victims can obtain continued financial assistance beyond a
three-month period and receive adjustments based on family size
and other factors. The plaintiffs also request that the court
order FEMA to eliminate certain rules regarding the use of funds
victims have already received and to cease a policy whereby FEMA
makes room for its housing by evicting and destroying the homes
of residents of trailer parks.
"More than two months after Katrina, thousands of Americans are
still being victimized, this time by bureaucratic inaction,
indifference and incompetence," said Howard O. Godnick of
Schulte Roth & Zabel LLP, a New York law firm that is providing
its services on a pro bono basis. "The poor and vulnerable --
including children, the elderly and the disabled -- are
suffering the most. It is an outrage that these victims must sue
a Federal agency to secure services they are so clearly entitled
to."
The legal action has been brought by 14 named plaintiffs on
their own behalf and on the behalf of a class of people who
lived in Louisiana, Mississippi or Alabama on August 29, 2005 in
areas that were subsequently declared Federal Disaster Areas,
were displaced by Hurricane Katrina and have or will apply for
disaster housing assistance under the Stafford Act. John K.
Pierre, a Professor at Southern University Law Center has been
retained as local counsel. Pierre described his involvement
saying "I just want to help out the people of Louisiana any way
I can." Steve Ronfeldt of The Public Interest Law Project in
Oakland and Eva Paterson of the Equal Justice Society also
worked on the Complaint.
For more details, contact Schulte Roth & Zabel, LLP, Phone:
1-212-843-8050, E-mail: rsolomon@rubenstein.com.
MAKITA U.S.A.: Recalls 1,500 Angle Grinders Due to Injury Hazard
----------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Makita U.S.A. Inc., of La Mirada, California is
voluntarily recalling about 1,500 units Makita 7-inch Angle
Grinders.
According to the company, the guards on some of these angle
grinders will not fully cover a hubbed grinding wheel. As a
result, if the hubbed grinding wheel comes apart during use, it
could hit the user, possibly causing serious personal injury.
Makita has not received any reports of incidents or injury.
Description: The recall only involves Makita GA7011C 7-inch
angle grinders. The grinder's model number and serial number are
located on the silver nameplate, which is located above the
trigger switch. The last four digits of the serial numbers of
the recalled grinders are in the following ranges: 1745 - 1748,
1768 - 1778, 1780 - 1784, 1797 - 1808, 1861 - 1872, 1885 - 1892,
1897 - 1900, 1909 - 1912, 1921 - 1924, 1953 - 1956, 1969 - 1972,
1989 - 1992, 2013 - 2016, 2025 - 2028, 2465 - 2468, 2471 - 2472,
2477 - 2484, 2489 - 2496, 2501 - 2508, 2513 - 2520, 2529 - 2540,
2549 - 2560, 2573 - 2576, 3133 - 3137, 3162 - 3169, 3874 and
3590 - 3613.
The grinder's housing is blue and the name "Makita" appears in
large white letters on the housing. No other Makita grinders are
involved in the recall. Manufactured in China, the grinder were
sold at industrial suppliers and home centers from about July
2005 through September 2005 for about $179.
Remedy: Consumers with these angle grinders should stop using
them with a hubbed grinding wheel immediately and contact Makita
to arrange for a replacement of their guard free of charge.
Known purchasers were sent direct mail notification of this
recall. Consumer Contact: For more information, call Makita
toll-free at (866) 838-5008 between 8 a.m. and 4:30 p.m. PT
Monday through Friday, or visit their Web site:
http://www.makitatools.com.
MCDONALD'S CORPORATION: Plaintiffs File Amended Suit in N.D. IL
---------------------------------------------------------------
Plaintiffs filed an amended securities class action against
McDonald's Corporation and certain of its officers in the United
States District Court for the Northern District of Illinois,
alleging violations of federal securities laws.
On April 2, 2004, a class action lawsuit, styled "Allan Selbst
v. McDonald's Corporation, Jack M. Greenberg, Matthew H. Paull
and Michael J. Roberts, case no. Case No. 04C-2422," was filed.
Two nearly identical actions were subsequently filed in the same
court. On October 19, 2004, the lead plaintiff filed its
amended and consolidated class action complaint, alleging, among
other things, that the Company and individual defendants misled
investors by issuing false and misleading financial reports and
earnings projections in a series of press releases and other
public statements between December 14, 2001 and January 22,
2003, thereby overstating the Company's current and anticipated
earnings. The amended complaint seeks class action
certification, unspecified compensatory damages, and attorneys'
fees and costs.
On January 18, 2005, the defendants filed a motion to dismiss
the amended complaint. On September 21, 2005, the Court denied
this motion. The lead plaintiff then filed its First Amended
Complaint on October 7, 2005.
MCMORAN EXPLORATION: Investor Suit Trial Reset To May 2006 in DE
----------------------------------------------------------------
Trial in the shareholder class action filed against McMoRan
Exploration Co. has been rescheduled for May 2006 in the
Delaware Chancery Court.
The suit alleges that the directors of Freeport-McMoRan Sulphur
Inc. breached their fiduciary duty to Freeport-McMoRan Sulphur
Inc.'s stockholders in connection with the 1998 merger of
Freeport-McMoRan Sulphur Inc. and McMoRan Oil & Gas Co. The
plaintiffs claim that the directors failed to take actions that
were necessary to obtain the true value of Freeport-McMoRan
Sulphur Inc. The plaintiffs also claim that McMoRan Oil & Gas
Co. knowingly aided and abetted the breaches of fiduciary duty
allegedly committed by the other defendants.
In September 2002, the Chancery Court granted the defendants'
motion to dismiss. The plaintiffs appealed the court's decision
and in June 2003, the Delaware Supreme Court reversed the trial
court's dismissal and remanded the case to the trial court for
further proceedings. The lawsuit was certified as a class
action in January 2005. In February 2005 the defendants filed a
motion for summary judgment, and on June 30, 2005, the Chancery
Court rendered a written opinion denying defendants' motion for
summary judgment. A trial on the merits was scheduled for
September 2005 but following Hurricane Katrina in late August
2005, the trial has been rescheduled for May 2006.
MEDICAL STAFFING: FL Court Dismiss in Part Securities Fraud Suit
----------------------------------------------------------------
The United States District Court for the Southern District of
Florida granted in part Medical Staffing Network Holdings,
Inc.'s motion to dismiss the consolidated securities class
action filed against it and certain of its officers and
directors.
On February 20, 2004, Joseph and Patricia Marrari, and on April
16, 2004, Tommie Williams, filed class action lawsuits against
Medical Staffing Network in the United States District Court for
the Southern District of Florida, on behalf of themselves and
purchasers of the Company's common stock pursuant to or
traceable to the Company's initial public offering in April
2002. The complaints allege that certain disclosures in the
Registration Statement/Prospectus filed in connection with the
Company's initial public offering on April 17, 2002 were
materially false and misleading in violation of the Securities
Act of 1933. The complaints seek compensatory damages as well
as costs and attorney fees.
On March 29, 2004, a third class action lawsuit brought on
behalf of the same class of Company stockholders, making claims
under the Securities Act similar to those in the lawsuits filed
by Plaintiffs Joseph and Patricia Marrari and Tommie Williams,
was commenced by Plaintiff Haddon Zia in the Florida Circuit
Court of the Fifteenth Judicial Circuit in and for Palm Beach
County, Florida. Defendants removed this case to the United
States District Court for the Southern District of Florida and
Plaintiff moved to remand the case back to the Florida Circuit
Court of the Fifteenth Judicial Circuit, which motion Defendants
opposed. On September 16, 2004 the federal district court
entered an order granting Plaintiff's motion to remand. On
January 6, 2005, the state court stayed the state court
proceedings until further order of the court. The Zia complaint
seeks rescission or damages as well as certain equitable relief
and costs and attorney fees.
On March 2, 2004, another class action complaint was filed
against the Company and certain of its directors and executive
officers in the United States District Court for the Southern
District of Florida by Jerome Gould, individually and on behalf
of a class of Company stockholders who purchased stock during
the period from April 18, 2002 through June 16, 2003. The
complaint alleges that certain of the Company's public
disclosures during the class period were materially false and
misleading in violation of Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The
complaint seeks compensatory damages, costs and attorney fees.
On July 2, 2004, the Marrari, Gould, Williams and Zia actions
were consolidated, although, as noted above, the Zia action was
subsequently remanded to state court. Plaintiff Thomas Greene
was appointed Lead Plaintiff of the consolidated action and the
law firm of Cauley Geller Bowman & Rudman LLP was appointed
Lead Counsel for Plaintiffs. On September 1, 2004, Lead
Plaintiff filed his consolidated amended class action complaint.
The Complaint makes allegations on behalf of a class consisting
of purchasers of the Company's common stock pursuant to or
traceable to its initial public offering in April 2002, for
purposes of the Securities Act claims, and on behalf of Medical
Staffing Network's s stockholders who purchased stock during the
period from April 18, 2002 through June 16, 2003, for purposes
of the Exchange Act claims. The Complaint alleges that certain
of the Company's public disclosures during the class period were
materially false and misleading in violation of Section 11 of
the Securities Act and Section 10(b) of the Exchange Act. The
Complaint seeks compensatory damages as well as costs and
attorney fees.
Defendants filed a motion to dismiss the Complaint, which on
September 27, 2005, was granted in part as to those portions of
the Plaintiff's Section 10(b) and 20(a) claims concerning
statements or omissions prior to October 29, 2002 and denied as
to the remaining claims. The litigation is now proceeding as to
those portions of the Complaint that were not dismissed.
MICHIGAN: Attorneys Seeks Expansion of Class in Inmate Lawsuit
--------------------------------------------------------------
Lawyers want to expand a proposed class action lawsuit against
Saginaw County in Michigan on claims that jail guards abused
inmates who were serving sentences, The Saginaw News reports.
Previously, attorneys sued the county over activities that took
place before inmates went to trial. But just recently, they
argued before U.S. District Judge David M. Lawson that they want
to widen the scope of the suit. "It should apply regardless of
reason in jail," according to Royal Oak attorney Stephen F.
Wasinger, who represents the plaintiffs on behalf of the
American Civil Liberties Union. Attorneys have already
identified 21 plaintiffs who filed suit in 2003 alleging that
jail personnel violated their rights by holding them naked in
cells. That number could exceed 100, Mr. Wasinger tells The
Saginaw News.
Mr. Wasinger told The Saginaw News that jail officials removed
inmates from the general population, placed them in segregated
areas and strip-searched them, adding, "We believe the law
dictates these are privacy issues." He argues that Judge Lawson
should grant certification because "there is a larger class of
persons whose rights would be compromised if this court does not
certify. A lot of people were subjected to a standard that was
unconstitutional. We got a lot of people who think they were
harmed."
Judge Lawson already ruled the county's conduct unconstitutional
and that the plaintiffs whether individually or as a class, can
seek liability damages. In his written opinion, Judge Lawson
said that the jail's policy of naked detention qualified as
"humiliating" and "demeaning."
The county's attorney, James E. Tamm of Bloomfield Hills, argued
that the proposed class should not include those serving jail
sentences. He contends that the proposed class should remain at
21 even as attorneys for the plaintiffs are attempting to
enlarge the class to 70 or more by adding post-trial inmates. He
also argues that some of the inmates did receive gowns to wear
while incarcerated, but they were not pre-trial detainees. Mr
Tamm also pointed out that the court already has determined
liability claims for pre-trial inmates and now the attorneys
want to bring in plaintiffs under a different set of facts. Mr.
Tamm, who is seeking to amend the complaint, arguing that
detainees should not receive damages unless they were physically
hurt, says about the claims, "That is inappropriate."
MIDAMERICAN ENERGY: NY Court Grants Certification To Fraud Suit
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted class certification for the consolidated
securities class action filed against MidAmerican Energy Co. and
other firms, in relation to a settlement for the suit.
The suit alleges that the defendants have engaged in unlawful
manipulation of the prices of natural gas futures and options
contracts traded on the New York Mercantile Exchange (NYMEX)
during the period of January 1, 2000 to December 31, 2002. The
Company is mentioned as a company that has engaged in wash
trades on Enron Online (an electronic trading platform) that had
the effect of distorting prices for gas trades on the NYMEX. The
plaintiffs to the class action do not specify the amount of
alleged damages.
The original complaint in this matter, styled "Cornerstone
Propane Partners, L.P. v. Reliant, et al.," was filed on August
18, 2003 in the United States District Court, Southern District
of New York naming the Company. On October 1, 2003, a second
complaint, styled "Roberto, E. Calle Gracey, et al. v. Reliant,
et al.," was filed in the same court but did not name the
Company. On November 14, 2003, a third complaint, styled
"Dominick Viola (Viola), et al.," was filed in the same court
and named the Company as a defendant. On December 5, 2003, the
court entered Pretrial Order No. 1, which among other procedural
matters, ordered the consolidation of the Cornerstone, Calle
Gracey and Viola complaints and permitted plaintiffs to file an
amended complaint in this matter. On January 20, 2004,
plaintiffs filed "In Re: Natural Gas Commodity Litigation," as
the amended complaint reasserting their previous allegations.
On February 19, 2004, the Company filed a Motion to Dismiss and
joined with several other defendants to file a joint Motion to
Dismiss. The plaintiffs filed a response on May 19, 2004,
contesting both Motions to Dismiss. On September 24, 2004, the
pending motions to dismiss were denied. On October 14, 2004,
plaintiffs filed an amended complaint to add certain defendants'
affiliates as defendants and reasserted their previous
allegations. The Company and the other defendants filed their
respective answers to the complaint on October 28, 2004.
Plaintiffs filed a motion for class actions certification on
January 25, 2005.
On September 6, 2005, the Company and counsel for the plaintiffs
executed a stipulation and agreement of settlement, which upon
final approval by the court following notice to all class
members, the Company will be dismissed from the lawsuit. The
Company agreed to the settlement in order to avoid the expense
and uncertainty associated with the ongoing litigation. If
accepted by the court, the settlement will not have a material
impact upon the Company. Additionally, the court issued an
order on September 29, 2005, granting the plaintiffs' motion for
class certification.
The suit is styled "Cornerstone Propane v. Reliant Energy, et
al., case no. 1:03-cv-06186-VM-AJP," filed in the United States
District Court for the Southern District of New York, under
Judge Victor Marrero and Magistrate Judge Andrew J. Peck.
Representing the Company are Robert A. Jaffe of Kutak, Rock,
L.L.P., 100 Park Avenue, New York, NY 10017, Phone: (212) 922-
9155; and Gregory Copeland, Holly Roberts, J. Michael Baldwin,
Baker Botts, L.L.P., One Shell Plaza, 910 Louisiana, Houston, TX
07002, Phone: (713) 229-1234. Plaintiffs are represented by:
(1) Ali Oromchian, Finkelstein Thompson & Loughran, 601
Montgomery Street, San Francisco, CA 94111, by Phone:
(415)-398-8700
(2) Christopher J. Gray, Law Office of Christopher J. Gray,
P.C, 460 Park Avenue 21st Floor, New York, NY 10022,
Phone: (212) 838-3221, Fax: (212) 508-3695, E-mail:
gray@cjgraylaw.com
(3) Christopher Lovell, Gary S. Jacobson, Lovell, Stewart,
Halebian, L.L.P., 500 Fifth Avenue, New York, NY 10110,
Phone: (212) 608-1900
(4) Louis F. Burke, Louis F. Burke, P.C., 460 Park Avenue,
21st Floor, New York, NY 10022, Phone: (212) 682-1700,
Fax: (212) 808-4280
MOLEX INC.: Shareholders Commence Securities Fraud Litigation
-------------------------------------------------------------
Molex, Inc. and certain of its officers and employees faces a
consolidated securities class action filed on behalf of a class
of Company stockholders from July 27, 2004 to February 14, 2005,
alleging violations of federal securities laws.
Seven suits were initially filed and later consolidated. The
consolidated complaint alleges, among other things, that during
the period the named defendants made or caused to be made a
series of materially false or misleading statements about the
Company's business, prospects, operations, and financial
statements which constituted violations of the federal
securities laws and rules. As relief, the complaint seeks,
among other things, declaration that the action be certified as
a proper class action, unspecified compensatory damages
(including interest) and payment of costs and expenses
(including fees for legal counsel and experts).
MOLSON COORS: Faces Securities, ERISA Lawsuits in Various Courts
----------------------------------------------------------------
Molson Coors Brewing Co. and certain of its officers and
directors face several purported class actions filed in the
United States and Canada, including the United States District
Courts in Delaware and Colorado and provincial courts in Canada,
alleging, among other things, that the Company and its
affiliated entities, including Molson Inc., and certain officers
and directors misled stockholders by failing to disclose first
quarter (January-March) 2005 U.S. business trends prior to the
Merger vote in January 2005.
In August 2005, another purported class action, predicated upon
factual allegations similar to those raised in the securities
class actions filed earlier this year in the United States and
Canada, was filed against the Company and certain of its
directors and officers in the United States District Court for
the District of Delaware. This action is filed purportedly on
behalf of participants in Molson Coors Brewing Company 401(k)
Savings Plan (Plan), and alleges that the defendants violated
their fiduciary duties under the Employee Retirement Income
Security Act of 1974 with respect to prudence and investment of
Plan assets by failing to disclose complete and accurate
information to Plan participants regarding investment in Company
common stock and by failing to monitor the Plan's investments
which resulted in losses by Plan participants who held Company
stock.
MONSANTO CO.: WV Dioxin Suits Moved Back to Putnam County Court
---------------------------------------------------------------
Two class action lawsuits that accuse Monsanto Co. and its
affiliates of contaminating the Nitro area with the chemical
dioxin are now headed back to Putnam County Circuit Court, WTRF
reports.
In a ruling handed down on November 2, Judge Robert C. Chambers
of the U.S. District Court for the Southern District of West
Virginia stated that the two related lawsuits should be
litigated in state rather than federal court. The lawsuits
accuse Monsanto and its affiliates of contaminating the water
and air with dioxin, a toxic chemical byproduct in the
manufacture of Agent Orange, 2,4,5-trichlorophenoxyacetic acid,
which Monsanto manufactured until 1965.
Plaintiffs' attorney Stuart Calwell told WTRF that one lawsuit
against Monsanto, which he called the "Carter case," is about
five years old and involves accusations of dioxin contamination
in local water supplies that also is affected property. A newer
case he called the "Allen case" was filed last year and alleges
Monsanto is responsible for dioxin in the air.
Charles Love, lead defense attorney, told WTRF that Monsanto
wanted both cases removed to federal court because of a recent
Pennsylvania case in which similar lawsuits were removed to
federal court. He pointed out, "The court here found that was
not a valid argument . and there's no appeal from that."
Thought somewhat pleased with the decision, Mr. Calwell told
WTRF that both the federal and circuit court judges were top-
notch jurists. "I suppose state court is better for the
plaintiff," he adds.
MPOWER HOLDING: Continues To Face Labor Violations Lawsuit in CA
----------------------------------------------------------------
MPower Holding Corporation faces a class action filed in the
Superior Court of the State of California for Los Angeles
County, alleging violations of California Labor Code Sections
2802 and 2804. The group of plaintiffs attempting to be formed
and certified as a class would include the Company's sales
representatives in California for the past four years.
The plaintiffs are seeking to recover what they claim to be
unreimbursed expenses incurred in the performance of their
duties, including additional mileage reimbursement. The Company
denied any liability to the plaintiffs, and intend to vigorously
defend the action, and believe that ultimate settlement or
damages awarded, if any, will not have a material adverse effect
on its financial position, results of operations or cash flows,
it stated in a disclosure to the Securities and Exchange
Commission.
MYLAN LABORATORIES: Plaintiffs Withdraw PA Securities Fraud Suit
----------------------------------------------------------------
Plaintiffs voluntarily dismissed the consolidated amended
shareholder class action filed against Mylan Laboratories, Inc.
and the members of its board of directors in the Court of Common
Pleas, Allegheny County, Pennsylvania.
On November 22, 2004, an individual purporting to be a Company
shareholder filed the civil action, alleging that the Board
members had breached their fiduciary duties by approving the
planned acquisition of King Pharmaceuticals, Inc. (King) and by
declining to dismantle the Company's anti-takeover defenses to
permit an auction of the Company to Carl Icahn or other
potential buyers of the Company, and also alleging that certain
transactions between the Company and its directors (or their
relatives or companies with which they were formerly affiliated)
may have been wasteful.
On November 23, 2004, a substantially identical complaint was
filed in the same court by another purported Company
shareholder. The actions were styled as shareholder derivative
suits on behalf of the Company and class actions on behalf of
all Company shareholders, and were consolidated by the court
under the caption "In re Mylan Laboratories Inc. Shareholder
Litigation."
The Company and its directors filed preliminary objections
seeking dismissal of the complaints. On January 19, 2005, the
plaintiffs amended their complaints to add Bear Stearns & Co.,
Inc., Goldman Sachs & Co., Richard C. Perry, Perry Corp.,
American Stock Transfer & Trust Company, and "John Does 1-100"
as additional defendants, and to add claims regarding trading
activity by the additional defendants and the implications on
the Company's shareholder rights agreement. On October 26, 2005,
the court approved the voluntary dismissal of these cases by the
plaintiffs, with prejudice.
NATURAL PRODUCTS: Enters FTC Consent Agreement For False Claims
---------------------------------------------------------------
Under the terms of a consent agreement approved by the Federal
Trade Commission (FTC), Tustin, California based Natural
Products, LLC, All Natural 4 U, LLC and their owner, Ana M.
Solkamans, are permanently prohibited from making false and
misleading claims about weight-loss products, including a
dietary supplement they marketed as "Bio Trim," "Body-Trim/Bio-
Trim," and "Body-Trim."
In a complaint filed in November 2004, the FTC alleged that the
defendants made false and unsubstantiated claims in advertising
on their Web sites and in magazines and newspapers around the
country. They claimed, for example, that Bio Trim "guarantee[d]
rapid weight loss" and its users could "eat all [they] want and
still lose weight (pill does all the work)."
"If you see an ad for a weight-loss product making fantastic
claims, keep your money in your pocket," said Lydia Parnes,
Director of the FTC's Bureau of Consumer Protection. "It's just
that - a fantasy. The claims made for Bio Trim were simply not
possible. There is no pill that lets you eat all you want and
still lose weight."
The Commission's complaint alleged that the defendants' sales
pitches were false, unsubstantiated, and in violation of the FTC
Act. Under the terms of the stipulated order settling the
Commission's charges, the defendants can no longer claim that
any weight-loss product:
(1) causes users to lose substantial weight while eating
unlimited amounts of food,
(2) causes substantial weight loss by blocking the
absorption of fat or calories, or
(3) works for all overweight users.
The order also prohibits the defendants from making any claims
that any health-related service or program, weight-loss product,
dietary supplement, food, drug or device causes weight loss, or
about their health benefits, performance, efficacy, safety, or
side effects, unless, at the time a claim is made, the
defendants have competent and reliable scientific evidence that
substantiates the truth of the claim. They are also prohibited
from profiting from, or disclosing, personal information about
their customers or prospective customers in connection with
commerce in weight-loss products.
A judgment of more than $2.1 million, representing the amount of
consumer injury, will be suspended due to defendants' inability
to pay. The judgment will be imposed if they are found to have
misrepresented their financial condition.
The stipulated final order stopping the defendants' allegedly
illegal conduct was a result of "Operation Big Fat Lie," the
Commission's November 2004, multi-agency crackdown on false
weight-loss advertising. The Commission vote approving the
consent agreement was 4-0. The FTC filed the proposed stipulated
final order in the U. S. District Court for the Central District
of California, Southern Division, on October 28, 2005. The order
was signed and filed on November 2, 2005 by District Judge
Alicemarie H. Stotler.
"Operation Big Fat Lie" identified "Seven Red Flag Bogus Weight-
Loss Claims" that the FTC has advised publications and
broadcasters to avoid. These "red flags" include the following:
a claim is too good to be true if it says the product will 1)
cause weight loss of two pounds or more a week for a month or
more without dieting or exercise; 2) cause substantial weight
loss no matter what or how much you eat; 3) cause permanent
weight loss (even when you stop using the product); 4) block the
absorption of fat or calories to enable you to lose substantial
weight; 5) safely enable you to lose more than three pounds per
week for more than four weeks; 6) cause substantial weight loss
for all users; or 7) cause substantial weight loss by wearing it
on the body or rubbing it into the skin.
Challenged ads in the "Operation Big Fat Lie" sweep ran in
nationally-known publications. For example, ads for defendants'
products ran in national magazines, including Woman's Own
magazine. The Red Flag Reference Guide for Media on Bogus Weight
Loss Claim Detection is available at
http://www.ftc.gov/bcp/conline/pubs/buspubs/redflag.pdfto
assist media in detecting false weight-loss claims. The FTC also
uses "teaser" websites such as http://wemarket4u.net/fatfoe/to
educate consumers about weight loss scams.
Copies of the complaint and stipulated final order are available
from the FTC's Web site at http://www.ftc.govand also from the
FTC's Consumer Response Center, Room 130, 600 Pennsylvania
Avenue, N.W., Washington, 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
Mitch Katz, Office of Public Affairs by Phone: 202-326-2161 or
Frank Dorman, Office of Public Affairs, by Phone: 202-326-2674,
or visit the Website:
http://www.ftc.gov/opa/2005/11/biotrim.htm.
NICOR INC.: Consumer Fraud Suit Moved To Dupage County, IL Court
----------------------------------------------------------------
The consumer class action filed against Nicor, Inc., Nicor Gas
and Nicor Services, entitled "Rivera v. Nicor Inc., Nicor Gas
and Nicor Services," has been transferred to the Circuit Court
of Dupage County, Illinois.
The class action was initially filed in the Circuit Court of
Cook County, Illinois, charging the Company with deceptive
practices relating to the marketing and sale of the Gas Line
ComfortGuard service offered by Nicor Services. The plaintiff
also alleges violations of the Illinois Consumer Fraud and
Deceptive Business Practices Act and unjust enrichment. The
plaintiff is seeking damages in an amount equal to the total Gas
Line ComfortGuard charges paid by the plaintiff and the putative
class members, punitive damages, and attorney's fees and costs.
The suit is styled "Rivera v. Nicor Inc., Nicor Gas and Nicor
Services, case no. 2005-CH-07875," under Judge Sophia H. Hall.
Representing the plaintiffs is MUCH SHELIST FREED, 191 N. Wacker
No. 1800, Chicago IL, 60606, Phone: (312) 521-2000. Representing
the Company is SONNENSCHEIN NATH & ROSEN, 8000 Sears Tower,
Chicago IL 60606, Phone: (312) 876-8000.
NICOR GAS: Working On Settlement of IL Mercury Injury Litigation
----------------------------------------------------------------
Nicor Gas Company reached a settlement for lawsuits filed
against it, related to its historical use of mercury in various
kinds of company equipment.
The Company is a defendant in several private lawsuits, all in
the Circuit Court of Cook County, Illinois, seeking a variety of
unquantified damages (including bodily injury, property and
punitive damages) allegedly caused by mercury-containing
regulators. The suit also names as defendants:
(1) Commonwealth Edison
(2) Exelon Corporation
(3) Illinois Gas Co.
(4) Northern Illinois Gas Co.
(5) Village Oak Park
(6) Parsons Engineering Science
(7) Oak Park District
(8) Cindy Melin
Under the terms of a class action settlement agreement, the
Company will continue, until 2007, to provide medical screening
to persons exposed to mercury from its equipment, and will use
its best efforts to replace any remaining inside residential
mercury regulators by 2006. The class action settlement
permitted class members to "opt out" of the settlement and
pursue their claims individually. The Company is currently
defending claims brought by 27 households.
The suit is styled "John Spillane, et al. v. Commonwealth
Edison, et al., case no. 2001-CH-20680," filed in the Circuit
Court of Cook County, Illinois. Plaintiff John Spillane is
represented by STERN, HOLSTEIN & ZIMMERMAN, 70 E Walton, Chicago
IL 60611, Phone: (312) 440-0020. Representing the Company is
MAYER BROWN ROWE MAW, 71 South Wacker Dr., Chicago IL 60606,
Phone: (312) 782-0600.
NICOR GAS: IL Property Owners Launch Suit V. Oak Park Facility
--------------------------------------------------------------
Nicor Gas Company continues to face class actions filed in the
Circuit Court of Cook County, Illinois, alleging among other
things, that the ongoing cleanup of a former manufactured gas
plant site in Oak Park, Illinois is inadequate.
In December 2001, a purported class action lawsuit was filed
against Exelon Corporation, Commonwealth Edison Company and the
Company. Since then, additional lawsuits have been filed
related to this same former manufactured gas plant site. These
lawsuits seek, in part, unspecified damages for property damage,
nuisance, and various personal injuries that allegedly resulted
from exposure to contaminants allegedly emanating from the site,
and punitive damages.
NISOURCE INC.: Trial in Gas Royalty Lawsuit Moved To 1st Q 2006
--------------------------------------------------------------
Trial in the class action filed against NiSource, Inc. in the
West Virginia Circuit Court for Roane County, styled "Tawney, et
al. v. Columbia Natural Resources, Inc.," has been rescheduled
from the third quarter of 2005, to the first quarter of 2006.
The Plaintiffs, who are royalty owners, filed a lawsuit in early
2003 against Columbia Natural Resources, Inc., alleging that
Columbia Natural Resources underpaid royalties by improperly
deducting post-production costs and not paying a fair value for
the gas produced from their leases. Plaintiffs seek the alleged
royalty underpayment and punitive damages claiming that Columbia
Natural Resources fraudulently concealed the deduction of post-
production charges.
The court has certified the case as a class action that includes
any person who, after July 31, 1990, received or is due
royalties from Columbia Natural Resources (and its predecessors
or successors) on lands lying within the boundary of the State
of West Virginia. All individuals, corporations, agencies,
departments or instrumentalities of the United States of America
are excepted from the class. Columbia Natural Resources
appealed the decision certifying the class and the Supreme Court
of West Virginia denied the appeal. Although NiSource sold
Columbia Natural Resources in 2003, it remains obligated to
manage this litigation and also remains at least partly liable
for any damages awarded to the plaintiffs. In December 2004,
the court granted plaintiffs' motion to add the Company and
Columbia Energy Group as defendants.
ON SEMICONDUCTOR: NY Court Preliminarily OKs Lawsuit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against ON
Semiconductor Corporation, certain of its former officers,
current and former directors and the underwriters for its
initial public offering.
During the period July 5, 2001 through July 27, 2001, the
Company was named as a defendant in three shareholder class
action lawsuits, alleging violations of the federal securities
laws. The suits were docketed in the U.S. District Court for
the Southern District of New York as:
(1) Abrams v. ON Semiconductor Corp., et al., C.A. No. 01-
CV-6114;
(2) Breuer v. ON Semiconductor Corp., et al., C.A. No. 01-
CV-6287; and
(3) Cohen v. ON Semiconductor Corp., et al., C.A. No. 01-
CV-6942
On April 19, 2002, the plaintiffs filed a single consolidated
amended complaint that supersedes the individual complaints
originally filed. The amended complaint alleges, among other
things, that the underwriters of the Company's initial public
offering improperly required their customers to pay the
underwriters' excessive commissions and to agree to buy
additional shares of its common stock in the aftermarket as
conditions of receiving shares in the Company's initial public
offering. The amended complaint further alleges that these
supposed practices of the underwriters should have been
disclosed in the Company's initial public offering prospectus
and registration statement. The amended complaint alleges
violations of both the registration and antifraud provisions of
the federal securities laws and seeks unspecified damages.
Various other plaintiffs have filed substantially similar class
action cases against approximately 300 other publicly traded
companies and their public offering underwriters in New York
City, which have all been transferred, along with the case
against the Company, to a single federal district judge for
purposes of coordinated case management.
On July 15, 2002, together with the other issuer defendants, the
Company filed a collective motion to dismiss the consolidated,
amended complaints against the issuers on various legal grounds
common to all or most of the issuer defendants. The underwriters
also filed separate motions to dismiss the claims against them.
In addition, the parties have stipulated to the voluntary
dismissal without prejudice of the Company's individual former
officers and current and former directors who were named as
defendants in our litigation, and they are no longer parties to
the litigation. On February 19, 2003, the Court issued its
ruling on the motions to dismiss filed by the underwriter and
issuer defendants. In that ruling the Court granted in part and
denied in part those motions. As to the claims brought against
the Company under the antifraud provisions of the securities
laws, the Court dismissed all of these claims with prejudice,
and refused to allow plaintiffs the opportunity to re-plead
these claims. As to the claims brought under the registration
provisions of the securities laws, which do not require that
intent to defraud be pleaded, the Court denied the motion to
dismiss these claims as to the Company and as to substantially
all of the other issuer defendants as well. The Court also
denied the underwriter defendants' motion to dismiss in all
respects.
In June 2003, upon the determination of a special independent
committee of the Company's Board of Directors, the Company
elected to participate in a proposed settlement with the
plaintiffs in this litigation. If ultimately approved by the
Court, this proposed settlement would result in a dismissal,
with prejudice, of all claims in the litigation against the
Company and against any of the other issuer defendants who elect
to participate in the proposed settlement, together with the
current or former officers and directors of participating
issuers who were named as individual defendants. The proposed
settlement does not provide for the resolution of any claims
against the underwriter defendants, and the litigation against
those defendants is continuing. The proposed settlement provides
that the class members in the class action cases brought against
the participating issuer defendants will be guaranteed a
recovery of $1 billion by the participating issuer defendants.
If recoveries totaling less than $1 billion are obtained by the
class members from the underwriter defendants, the class members
will be entitled to recover the difference between $1 billion
and the aggregate amount of those recoveries from the
participating issuer defendants. If recoveries totaling $1
billion or more are obtained by the class members from the
underwriter defendants, however, the monetary obligations to the
class members under the proposed settlement will be satisfied.
In addition, the Company and any other participating issuer
defendants will be required to assign to the class members
certain claims that it may have against the underwriters of its
initial public offerings.
The proposed settlement contemplates that any amounts necessary
to fund the settlement or settlement-related expenses would come
from participating issuers' directors and officers' liability
insurance policy proceeds, as opposed to funds of the
participating issuer defendants themselves. A participating
issuer defendant could be required to contribute to the costs of
the settlement if that issuer's insurance coverage were
insufficient to pay that issuer's allocable share of the
settlement costs. Consummation of the proposed settlement is
conditioned upon obtaining both preliminary and final approval
by the Court. Formal settlement documents were submitted to the
Court in June 2004, together with a motion asking the Court to
preliminarily approve the form of settlement. Certain
underwriters who were named as defendants in the settling cases,
and who are not parties to the proposed settlement, opposed
preliminary approval of the proposed settlement of those cases.
On February 15, 2005, the Court issued an order preliminarily
approving the proposed settlement in all respects but one. The
plaintiffs and the issuer defendants are in the process of
assessing whether to proceed with the proposed settlement, as
modified by the Court. If the plaintiffs and the issuer
defendants elect to proceed with the proposed settlement, as
modified by the Court, they will submit revised settlement
documents to the Court. The underwriter defendants may then
have an opportunity to object to the revised settlement
documents. If the Court approves the revised settlement
documents, it will direct that notice of the terms of the
proposed settlement be published in a newspaper and mailed to
all proposed class members and schedule a fairness hearing, at
which objections to the proposed settlement will be heard.
Thereafter, the Court will determine whether to grant final
approval to the proposed settlement.
On September 1, 2005, the Court preliminarily approved the
proposed settlement, directed that notice of the terms of the
proposed settlement be provided to class members, and scheduled
a fairness hearing, at which objections to the proposed
settlement will be heard. Thereafter, the Court will determine
whether to grant final approval to the proposed settlement.
The suit is styled "IN RE ON SEMICONDUCTOR CORPORATION INITIAL
PUBLIC OFFERING SECURITIES LITIGATION," filed in relation to "IN
RE INITIAL PUBLIC OFFERING SECURITIES LITIGATION, Master File
No. 21 MC 92 (SAS)," both pending in the United States District
Court for the Southern District of New York, under Judge Shira
N. Scheindlin. The plaintiff firms in this litigation are:
(i) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(ii) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300
(iii) Schiffrin & Barroway, LLP, Mail: 3 Bala Plaza E, Bala
Cynwyd, PA, 19004, Phone: 610.667.7706, Fax:
610.667.7056, E-mail: info@sbclasslaw.com
(iv) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(v) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(vi) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
PATINA OIL: CO Court Grants Certification To Gas Royalties Suit
---------------------------------------------------------------
The District Court for Weld County, Colorado granted class
certification for the lawsuit filed against Patina Oil & Gas
Corporation, styled "Jack Holman, et al v. Patina Oil & Gas
Corporation; Case No. 03-CV-09."
The suit was initially filed in January 2003, alleging that the
Company had improperly deducted certain costs in connection with
its calculation of royalty payments relating to its Colorado
operations. In May 2004, the plaintiff filed an amended
complaint narrowing the class of potential plaintiffs, and
thereafter filed a motion seeking to certify the narrowed class
as described in the amended complaint. The class certification
motion was heard on September 22, 2005 and granted on October
13, 2005.
PENNSYLVANIA: School District to Comply with Gaskin Settlement
--------------------------------------------------------------
North Hills School Board members in Pennsylvania are focusing on
special education requirements due to ramifications of a new
court settlement that will affect the field of education for
years to come, The McKnight Journal reports.
The Gaskin Settlement, is the result of a class action lawsuit
brought on behalf of all Pennsylvania special education students
with physical, behavioral and developmental disabilities. First
brought about a decade ago, the suit alleged that students with
disabilities in the state were denied their federal statuary
right to a free appropriate public education in the least
restrictive environment, in other words a regular education
classroom. The suit also alleged that special education
students were denied supplemental aids and services to make the
least restrictive environment possible.
The suit came about when the Carlisle Area School District in
Cumberland County refused to allow the parents of Lydia Gaskin,
who has Down syndrome, to place her in a regular kindergarten
classroom. Ms. Gaskin, now 21, graduated this year from high
school in Carlisle, having completed almost all of her education
in regular classes, an earlier Class Action Reporter story
(September 22, 2005) reports.
Rita Neu, assistant to the superintendent for pupil services
told McKnight Journal, "This is the most important legal
agreement in the courts in the last 20 years. We will be
impacted on our special education audit in December, which will
look at how included they are in regular education." North Hills
School district has 618 special education students with 12
placed outside the district.
According to a letter from Ms. Neu to the superintendent,
special education students in the district are in regular
education classrooms 63.7-percent of the day as opposed to the
overall average of 44.1 percent. Additionally, 75.1 percent
receive the minimum amount of pull out services while the state
average is 37.2 percent.
During North Hills' last audit, the district received two
commendations including that they provide least restrictive
environment for most of their special education students and
that secondary student have opportunities to prepare for life
after school through transition placements in supported
employment training opportunities.
The settlement gives more power to the parents of disabled
children and forces state officials to make sure school
districts comply with the federal Individuals with Disabilities
Education Act (IDEA). Specifically, under the deal, the state is
required to set up a five-year monitoring system, along with a
parent-dominated advisory board. The settlement also requires
that school districts be graded on how well they include
disabled children in regular classrooms with those with the
worst records of including disabled students being placed on a
monitoring list. The state will then help the failing districts
improve and impose penalties on those who don't. Additionally,
the settlement stipulates that the most severe penalties include
losing state funds and disciplinary action against school
administrators, an earlier Class Action Reporter story
(September 22, 2005) reports.
Under the federal IDEA law passed in 1974, state public schools
are required to make sure disabled students spend as much time
with non-disabled students as possible and receive as much
academic instruction as possible. It covers mental retardation,
physical handicaps and autism, an earlier Class Action Reporter
story (September 22, 2005) reports.
QUANTUM CORPORATION: Faces DLT Tape Antitrust Suit Filed in CA
--------------------------------------------------------------
Quantum Corporation continues to face a class action lawsuit
filed in the Superior Court of the State of California for the
County of San Francisco. The suit also names as defendants:
(1) Hitachi Maxell, Ltd.,
(2) Maxell Corporation of America,
(3) Fuji Photo Film Co., Ltd., and
(4) Fuji Photo Film U.S.A., Inc.
The plaintiff, Franz Inc., alleges violation of California
antitrust law, violation of California unfair competition law,
and unjust enrichment. Franz Inc. charges, among other things,
that the defendants entered into agreements and conspired to
monopolize the market and fix prices for data storage tape
compatible with DLT tape drives. Franz seeks an order that the
lawsuit be maintained as a class action and that defendants be
enjoined from continuing the violations alleged in the
complaint. Franz also seeks compensatory damages, treble
damages, statutory damages, attorneys' fees, costs, and
interest.
STEWART FINANCE: Settles FTC Deceptive Trade Practices Lawsuit
--------------------------------------------------------------
Stewart Finance Company, seven related companies, and their
principals have agreed to settle Federal Trade Commission
charges that the companies deceived consumers, many of them
elderly, by, among other things, packing optional products such
as accidental death and dismemberment insurance and membership
in roadside assistance clubs onto small personal loans of $500
or less. The settlement requires the companies to shut down and
to agree to the entry of a $10.5 million judgment in the FTC's
case. The companies will liquidate their assets in federal
bankruptcy court and through a federal district court
receivership. Because the companies also owe amounts to other
creditors, the FTC does not expect to collect the full amount of
its judgment against the defendants. Monies the FTC receives
through the bankruptcy and receivership will be combined with
amounts due from certain individual defendants and directed to a
consumer redress fund.
In a complaint filed in September 2003, the Commission alleged
that the defendants deceptively induced consumers to purchase
expensive add-on products ancillary to the loan, to participate
in a free "direct deposit" program that was not in fact free,
and to incur additional costs and fees by repeatedly refinancing
their loans. The complaint also alleged that the company failed
to provide consumers who were denied loans with federally
required "adverse action" notices, and took unlawful security
interests in borrowers' household goods.
According to the FTC, the Stewart companies violated the FTC
Act, the Truth In Lending Act (TILA), its implementing
regulation, Regulation Z, the Fair Credit Reporting Act, and the
FTC's Credit Practices Rule. In addition to defendants Stewart
Finance Company and the late John Ben Stewart Jr., the FTC's
complaint named Stewart Finance Company Holdings, Inc.; Stewart
National Finance Company, Inc.; D & E Acquisitions, Inc.;
Preferred Choice Auto Club, Inc.; Stewart Insurance, Ltd.; and J
& J Insurance, Ltd. The complaint also named Mr. Stewart's wife,
Janice Stewart, and his two sons, William Joseph Stewart and
John Benjamin Stewart III. The family members of John Ben
Stewart Jr., the deceased company owner, were joined solely as
relief defendants and were not charged with any wrongdoing.
The stipulated final order permanently bars the Stewart
companies and their principals from participating in any lending
or direct deposit business. The stipulated final order also
prohibits the companies from failing to disclose clearly and
conspicuously the material terms of any loan, from
misrepresenting the cost, benefit, or optional nature of any
add-on loan products, from soliciting consumers for costly
renewal loans, from misrepresenting direct deposit as a "free"
service, or misrepresenting its costs and terms, from violating
TILA, from violating the Fair Credit Reporting Act by failing to
provide adverse action notices, and from taking security
interests in household goods contrary to the Credit Practices
Rule.
Under the terms of the settlement, the FTC will obtain
(1) a $10.5 million claim in the consolidated bankruptcy
cases of Stewart Finance Company, Stewart National
Finance Company, and D & E Acquisitions, Inc., and in
the bankruptcy case of John Ben Stewart Jr.,
(2) a fifty percent share of the assets of the district
court receivership,
(3) a suspended judgment of $250,000 against relief
defendant Janice Stewart, and
(4) a judgment of $423,592.91 against relief defendants
William Joseph Stewart and John Benjamin Stewart III.
The settlement, announced by the Federal Trade Commission, must
be approved by a federal district court in Atlanta, Georgia,
before it is final. The Commission vote authorizing staff to
file the stipulated final judgment and order was 4-0. The order
was filed in the U.S. District Court for the Northern District
of Georgia on November 4, 2005.
Copies of the complaint and stipulated final judgment and order
are available from the FTC's Web site at http://www.ftc.govand
also from the FTC's Consumer Response Center, Room 130, 600
Pennsylvania Avenue, N.W., Washington, 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, visit the Website:
http://www.ftc.gov/opa/2005/11/stewart.htm.
SUNRISE POWER: CA Court Sustains Demurrer in Unfair Trade Suit
--------------------------------------------------------------
The Superior Court of the State of California, City and County
of San Francisco sustained Sunrise Power Company's demurrer
regarding preemption and filed rate doctrine in relation to a
class action filed in the Superior Court of the State of
California, City and County of San Francisco. The suit was
filed by James M. Millar, "individually, and on behalf of the
general public and as a representative taxpayer suit" against
sellers of long-term power to the California Department of Water
Resources, including the Company.
The lawsuit alleges that the defendants, including the Company,
engaged in unfair and fraudulent business practices by knowingly
taking advantage of a manipulated power market to obtain unfair
contract terms. The lawsuit seeks to enjoin enforcement of the
"unfair and oppressive terms and conditions" in the contracts,
as well as restitution by the defendants of excessive monies
obtained by the defendants. Plaintiffs in several other class
action lawsuits pending in Northern California have filed
petitions seeking to have the Millar lawsuit consolidated with
those lawsuits.
In December 2003, James Millar filed a First Amended Class
Action and Representative Action Complaint which contains
allegations similar to those in the earlier complaint but also
alleges a class action. One of the newly added parties removed
the lawsuit to federal court, and the court ordered remand to
the San Francisco Superior Court. Defendants filed a responding
pleading on May 6, 2005. Following a hearing on September 7,
2005, the court sustained defendants' demurrer regarding
preemption and filed rate doctrine. The plaintiff has waived his
right to appeal.
The suit is styled "James M. Millar, individually and on behalf
of all others similarly situated and on behalf of the general
public v. Allegheny Energy, et al., Case No. 04-CV-901," pending
in the Superior Court of San Francisco, California. Lawyers for
the plaintiffs are Steve W Berman of Hagens and Berman, 1301
Fifth Avenue, Suite 2900, Seattle, WA 98101, Phone:
(206) 623-0594 or (206)623-7292; and Kevin P Roddy of Hagens
Berman, 700 South Flower Street, Suite 2940, Los Angeles, CA
90017-4101, Phone: (213)330-7150 or (213)330-7152.
TYCO INTERNATIONAL: Meites Mulder Expands Suit Investigation
------------------------------------------------------------
The law firm of Meites, Mulder, Burger & Mollica is broadening
its investigation in a class action that is pending against Tyco
International and Tyco directors on behalf of former
shareholders of Mallinckrodt, Inc. (MLKT), which was acquired by
Tyco in a merger effective October 17, 2000 in which
Mallinckrodt shareholders exchanged shares of Mallinckrodt
common stock for shares of Tyco common stock.
The firm seeks to contact former Mallinckrodt shareholders as
part of an investigation into whether registration statements
misrepresented or omitted material facts regarding Tyco's
business condition.
A class action was filed against Tyco in the Circuit Court of
Cook County in Illinois, alleging that this undisclosed
information was material to Mallinckrodt shareholders
considering how to vote on the Merger.
For more details, contact Paul Mollica of Meites, Mulder, Burger
& Mollica, Phone: 312-263-0272, Web site:
http://www.mmbmlaw.com,and Robert Allison of Robert Allison &
Associates, Phone: 312-427-7600.
TYSON FOODS: Supreme Court Ruling Favors WA Plant's Meat Packers
----------------------------------------------------------------
The U.S. Supreme Court cleared the way for 800 workers at a
former IBP Inc.-owned Pasco, Washington meat packing plant to
receive $7.3 million compensation in a protracted class action
case that both the business community and organized labor
followed closely, The News Tribune reports.
In a unanimous decision, which is the first by the court since
John Roberts was sworn in as chief justice, it ruled that the
workers should be paid not only for the time it takes for them
to put on protective clothing, but also for the three to four
minutes it takes them to walk from the locker room to the
production line. The ruling comes barely eight weeks after the
court heard oral arguments.
Kathy Goater, one of the Seattle attorneys who represented the
workers told The News Tribune, "We though we would win, but a
unanimous decision makes this even better. It's been a long wait
for them."
Attorneys for Tyson Fresh Meats Inc., which now owns the Paso
plant, told IBP Inc. that it was reviewing the court's ruling
and so could not immediately comment.
With the high court's decision, the case, which was filed back
in 1999, will now be sent back to U.S. District Judge Robert
Whaley in Spokane, who earlier had awarded the workers the $7.3
million, Ms. Goater told The News Tribune. The workers could
receive their money by the first of the year while lawyers will
receive an additional $1.9 million for their work, according to
her.
Workers brought the class action lawsuit, Alvarez vs. IBP,
claiming that they should be paid for the time it takes them to
put on protective clothing. They argued that because federal law
and the company required the gear, their workday should begin
when they start to put it on, an earlier Class Action Reporter
story (October 6, 2005) reports.
The company countered that the 1947 Portal-to-Portal Act
required only that they start paying the workers when they
arrived at their actual workstations, an earlier Class Action
Reporter story (October 6, 2005) reports. Additionally, during
later oral arguments, a lawyer representing IBP contended that
even though the walking time involved was fairly minimal, paying
workers for it could cost business billions of dollars.
However, Judge Whaley and later the 9th U.S. Circuit Court of
Appeals agreed with the workers even though another federal
appeals court issued a differing opinion in a similar case. IBP,
now a part of Tyson Foods, appealed the case to the Supreme
Court, which agreed to hear whether workers should be paid for
the time it took to walk from the changing room to the
production line, an earlier Class Action Reporter story (October
6, 2005) reports.
In an opinion written by Justice John Paul Stevens, the Supreme
Court noted that 50 years earlier it had ruled that workers
should be compensated for the time it took for them to put on
clothing required by federal or state law. The court went on to
say the workers also should be paid for the time it took them to
walk to their workstations.
In addition, Justice Stevens wrote that the workers' day begins
at the time they started dressing in the special gear. "The
relevant walking in this case occurs after the workday begins
and before it ends," according to him.
The suit is styled, "Alvarez, et al v. IBP Inc., Case No. 2:98-
cv-05005-RHW," filed in the United States District Court for the
Eastern District of Washington, under Judge Robert H. Whaley.
Representing the Defendant are, Nancy Watkins Anderson, Douglas
E. Smith, Sarah Elyse Haushild, Barbara J. Duffy and Michael
Barr King of Lane Powell Spears Lubersky LLP - SEA, 1420 Fifth
Ave., Suite 4100, Seattle, WA 98101-2338, Phone: 206-223-7000,
Fax: 12062237107, E-mail: andersonn@lanepowell.com and
smithd@lanepowell.com; and Clemens H. Barnes of Graham & Dunn PC
2801 Alaskan Way, Suite 300, Pier 70, Seattle, WA 98121-1128,
Phone: 206-340-9681, Fax: 206-340-9599, E-mail:
cbarnes@grahamdunn.com. Representing the Plaintiff/s are:
(1) William Rutzick and Kathryn Goater of Schroeter
Goldmark & Bender, 810 Third Ave., Suite 500, Seattle,
WA 98104-1614, Phone: 206-622-8000, Fax: 12066822305,
E-mail: rutzick@sgb-law.com, and goater@sgb-law.com;
(2) Richard G. Piccioni of Richard Piccioni Attorney at
Law, 1916 Pike Place, Suite 12-203, Seattle, WA 98101,
Phone: 206-443-1344; and
(3) David N. Mark of The Law Office of David N. Mark, 810
Third Ave., Suite 500, Seattle, WA 98104, Phone: 206-
340-1840, Fax: 12063401846, E-mail:
david@marklawoffice.com.
WESTAR ENERGY: KS Court Approves Securities Lawsuit Settlement
--------------------------------------------------------------
The United States District Court in Topeka, Kansas approved the
settlement of the class action filed against Westar Energy, Inc.
and certain of its present and former officers is proceeding.
The suit, styled "In Re Westar Energy, Inc. Securities
Litigation, Master File No. 5:03-CV-4003," is pending in the
United States District Court in Topeka, Kansas.
Plaintiffs filed a Consolidated Amended Complaint on July 15,
2003. The lawsuit is brought on behalf of purchasers of the
Company's common stock between March 29, 2000, the date the
Company announced its intention to separate its electric utility
operations from its unregulated businesses, and November 8,
2002, the date the KCC issued an order prohibiting the
separation.
The lawsuit alleges that the Company violated federal securities
laws by making material misrepresentations or omitting material
facts concerning the purpose and benefits of the previously
proposed separation of the Company's electric utility operations
from its unregulated businesses, the compensation of its senior
management and the independence and functioning of its board of
directors and that as a result the Company artificially inflated
the price of the Company's common stock.
On August 26, 2004, the court issued an order granting a joint
motion of all parties, which stayed the lawsuit until December
7, 2004, pending efforts to settle the lawsuit through
mediation. The court also denied without prejudice motions to
dismiss the lawsuit filed by the Company and other defendants.
The court stated its intention to set aside the order upon
notice by any party that mediation efforts were unsuccessful, in
which case the court would address the motions to dismiss the
lawsuit.
In early April 2005, the Company reached an agreement in
principle with the plaintiffs to settle this lawsuit for $30.0
million. The Company will pay $1.25 million of the settlement
and our insurance carriers will pay $28.75 million of the
settlement, which includes the payments by its insurance
carriers related to the settlement of the shareholder derivative
lawsuit described below, less legal fees for the plaintiffs'
counsel in that matter. The full terms of the proposed
settlement are set forth in a Stipulation and Agreement of
Compromise, Settlement and Release dated as of May 31, 2005
filed with the court. On September 1, 2005, the court approved
the proposed settlement and directed the parties to consummate
the settlement in accordance with the stipulation. Pursuant to
the stipulation, the Company paid $1.25 million and our
insurance carriers paid $28.75 million into a settlement fund
that will be disbursed, after payment of $9.0 million of legal
fees for plaintiffs' counsel plus expenses, to shareholders as
provided in the stipulation.
WESTAR ENERGY: Re-enters Mediation For KS ERISA Suit Settlement
---------------------------------------------------------------
Westar Energy enters mediation again to attempt a settlement for
the consolidated class action filed against it and certain of
its present and former officers and employees, styled "In Re
Westar Energy ERISA Litigation, Master File No. 03-4032-JAR."
The suit is pending in the United States District Court in
Topeka, Kansas, on behalf of participants in, and beneficiaries
of, the Company's Employees' 401(k) Savings Plan between July 1,
1998 and January 1, 2003. The lawsuit alleges violations of the
Employee Retirement Income Security Act arising from the conduct
of certain present and former officers and employees who served
or are serving as fiduciaries for the plan.
The conduct is related to alleged securities law violations
related to the previously proposed separation of the Company's
electric utility operations from our unregulated businesses, its
rate cases filed with the KCC in 2000, the compensation of and
benefits provided to its senior management, energy marketing
transactions with Cleco Corporation (Cleco) and the first and
second quarter 2002 restatements of its consolidated financial
statements related to the revised goodwill impairment charge and
the mark-to-market charge on its putable/callable notes.
On August 26, 2004, the court issued an order granting a joint
motion of all parties, which stayed the lawsuit until December
7, 2004, pending efforts to settle the lawsuit through
mediation. The court also denied without prejudice motions to
dismiss the lawsuit filed by us and other defendants. The court
stated its intention to set aside the order upon notice by any
party that mediation efforts were unsuccessful, in which case
the court would address the motions to dismiss the lawsuit.
On February 8, 2005, the court held a conference at which the
parties notified the court that efforts to settle the lawsuit
through mediation had not been successful. The court then
issued an order renewing the previously filed motions to dismiss
and issued a scheduling order addressing the scope and timing of
discovery in the lawsuit. On September 29, 2005, the court
largely denied motions to dismiss previously filed by the
defendants. The parties have notified the court of efforts to
settle the lawsuit through mediation.
WHOLESALE CONNECTION: IL Businessman Sues Over Unsolicited Faxes
----------------------------------------------------------------
John Alleman initiated a class action lawsuit in U.S. District
Court for the Southern District of Illinois against Wholesale
Connection of Longwood, Florida over two unsolicited faxes
received at his Carbondale business, The Madison County Record
reports.
Mr. Alleman claims that on October 11 and October 27, Wholesale
sent faxes for discount vacations to Orlando and Daytona Beach
without his consent or approval in violation of the Telephone
Consumer Protection Act (TCPA). The act states that no person
may use a telephone facsimile machine, computer or other device
to send an unsolicited advertisement to a telephone fax machine.
The complaint alleges that Wholesale sent over 1,000 unsolicited
advertisements in the past year to people all over the country.
It also states, "John Alleman has an actual claim for damages
under the TCPA, and is a representative who will fairly and
adequately protect the interests of all class members and a
class action is the superior method for the fair and efficient
adjudication of the issues raised."
Mr. Alleman, represented by Mark Prince of the Prince Law Firm
in Carbondale, is asking the court to restrain Wholesale from
sending unsolicited faxes, certify his complaint as a class
action naming him the representative, and certifying the class
as "All persons who seek damages from Wholesale Connection for
sending unsolicited advertisements in the past 12 months."
In addition, he also seeks a judgment of $500 for each
violation, and if the court deems that Wholesale willfully or
knowingly violated the TCPA, a judgment for $1,500 for each act.
Costs are also being sought.
The suit is styled, "Alleman v. Wholesale Connection Co., Inc.,
Case No. 05-CV-04205-JPG-PMF," filed in the United States
District Court for the Southern District of Illinois, under
Judge G. Patrick Murphy, with referral to Judge J. Phil Gilbert
and Judge Philip M. Frazier. Representing the Plaintiff is Mark
D. Prince of Prince Law Firm, Generally Admitted, 204 W. College
P.O. Box 1030, Carbondale, IL 62903, Phone: 618-457-5575, E-
mail: mdprince@princelawfirm.net.
WORLD KITCHEN: Recalls 472T Immersion Heaters Due to Shock Risk
---------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), World Kitchen Inc., of Reston, Virginia and Chun Tai
Electric Heater Company, of Taiwan are voluntarily recalling
about 472,000 units of Immersion Heaters.
According to the companies, moisture in the heating element
could cause corrosion over time, presenting a shock hazard.
World Kitchen Inc. has received two reports of short circuits.
No injuries have been reported.
The immersion heaters are portable chrome-plated steel heaters
with a white plastic handle and mug hook used for warming tea,
coffee, soup, or other liquids. "IMMERSION HEATER," and "MADE IN
TAIWAN" are embossed on the white plastic handle of these
heaters. Some products were sold under the EKCO brand and others
were sold with no brand. Manufactured in Taiwan, the heaters
were sold at all mass retailers, hardware and grocery stores
nationwide from January 1999 through August 2005 for between $5
and $6.
Remedy: Consumers should immediately stop using the product and
contact World Kitchen for a refund. Consumer Contact: Contact
World Kitchen at (800) 853-6567 between 9 a.m. and 5 p.m. ET
Monday through Friday, or visit the firm's Web site:
http://www.worldkitchen.com.
WORTHINGTON FOODS: Recalls Patties Due to Undeclared Egg, Milk
--------------------------------------------------------------
Worthington Foods of Battle Creek, MI is recalling about 6,000
cans of Worthington Choplets Vegetable and Grain Protein Patties
because they may contain undeclared egg and milk. People with an
allergy or severe sensitivity to egg or milk run the risk of
serious or life-threatening allergic reaction if they consume
this product.
The affected cans of Worthington Choplets were distributed in
Arizona, California, Colorado, Illinois, Iowa, Kansas,
Minnesota, Missouri, New York, Ohio, Oregon, South Dakota and
Washington State through grocery and natural food retail stores
and foodservice distributors.
The product is packaged in a 1 LB. 4 oz can with a green
Worthington Choplets label and a bar code of 28989 22503. Only
cans with a manufacturing code beginning with 06085 CS L stamped
on the bottom of the can are included in this alert. No allergic
reactions have been reported to date.
The recall was initiated after it was discovered that the label
for Worthington Choplets, which does not declare egg or milk,
was mistakenly applied to a limited number of cans containing a
veggie hot dog type product containing egg and milk.
Subsequently the packaging does not reveal the presence of egg
or milk.
Consumers who have a Worthington Choplets can with a bar code of
28989 22503 and a manufacturing code beginning 06085 CS L
stamped on the bottom should call 1-800-557-6525.
New Securities Fraud Cases
BLOCKBUSTER INC.: Milberg Weiss Files Securities Suit in N.D. TX
----------------------------------------------------------------
The law firm of Milberg Weiss Bershad & Schulman, LLP, initiated
a class action lawsuit on behalf of purchasers of all those who
acquired shares of Blockbuster, Inc. ("Blockbuster" or the
"Company") (NYSE:BBI) pursuant to the Company's exchange offer
of Viacom, Inc. ("Viacom") stock for 144 million common shares
of Blockbuster (the "Exchange Offer"), and on behalf of those
who purchased Blockbuster shares in the open market between
September 8, 2004 and August 9, 2005, inclusive (the "Class
Period"). The lawsuit seeks to pursue remedies under the
Securities Exchange Act of 1934 (the "Exchange Act").
The action, numbered 05 CV 2213, is pending in the United States
District Court for the Northern District of Texas before the
Honorable David C. Godbey against defendants Blockbuster;
Viacom, National Amusements, Inc. (Viacom's controlling
shareholder) and certain of Viacom and Blockbuster's officers
and directors.
The complaint alleges that Viacom was Blockbuster's controlling
shareholder and that, prior to the Exchange Offer, Viacom caused
Blockbuster to pay a $5 per share special dividend of which
Viacom was the primary beneficiary. In order to pay the
dividend, Blockbuster was forced to take on debt in the amount
of approximately $1.1 billion.
Subsequently, in the Prospectus issued in connection with
Viacom's divestiture of its Blockbuster shares, (the
"Prospectus"), defendants stated that Blockbuster planned to
transform itself "from a place where you go to rent a movie to a
brand where you go to rent, buy or trade a movie or game, new or
used, pay-by-the-day, pay-by-the-month, in-store or online." The
transformation was to be achieved through a series of
initiatives: Blockbuster Online (Internet sales); Movie Pass
(in-store movie subscription); Game Pass (in-store game
subscription); and "No More Late Fees." Defendants warned
investors that the transformation would require heavy investment
but assured them that Blockbuster's debt obligations would not
stand in the way and that, "the steady operating cash flow from
our core rental business has provided us with the ability to
invest in new initiatives."
As set forth in the complaint, defendants failed to disclose in
the Prospectus and throughout the Class Period that Blockbuster
was wholly unprepared to build the technological infrastructure
required to integrate its in-store and online sales operations
and otherwise execute the Company's transformation. Moreover,
the Company's core in-store rental operations were not
generating sufficient cash flow to fund Blockbuster's investment
in "new initiatives." The truth began to emerge on August 9,
2005, when, before the market opened, the Company reported:
(1) a second-quarter net loss of $57.2 million, or $0.31
per share --- well below Company-guided analyst
estimates;
(2) negative free cash flow of $118 million compared to
positive free cash flow of $23 million in the second
quarter of 2004; and
(3) that it was abandoning its 2005 guidance.
The Company also announced that, on August 8, 2005, it had been
forced to amend its credit facility to provide for a waiver of
its leverage ratio covenants. After this announcement, the
Company's stock opened that morning at $7.05, down 11.9%, or
$0.96 from the previous day's closing price of $8.01. The stock
continued to decline as the market absorbed the full impact of
the announcement, falling to a six-year low of $6.30 on August
10, 2005.
After the Class Period, on November 8, 2005, defendants stated
in an SEC filings that Blockbuster "may not have sufficient cash
flows from operating activities, cash on hand and available
borrowings under our credit facilities to service our
indebtedness" and that the Company could be forced into
bankruptcy if it was unable to raise additional funds through a
private offering.
Milberg Weiss Bershad & Schulman LLP
(http://www.milbergweiss.com)is a firm with over 100 lawyers
with offices in New York City, Los Angeles, Boca Raton, Delaware
and Washington, D.C. and is active in major litigations pending
in federal and state courts throughout the United States.
Milberg Weiss has taken a leading role in many important actions
on behalf of defrauded investors, consumers, and others for
nearly 40 years. Please contact the Milberg Weiss website for
more information about the firm. If you wish to discuss this
action with us, or have any questions concerning this notice or
your rights and interests with regard to the case, please
contact the following attorneys:
For more details, contact Steven G. Schulman, Peter E. Seidman
and Andrei V. Rado, One Pennsylvania Plaza, 49th fl., New York,
NY, 10119-0165, Phone: (800) 320-5081, E-mail:
sfeerick@milbergweiss.com, Web site:
http://www.milbergweiss.com.
BLOCKBUSTER INC.: Schatz & Nobel Lodges Securities Suit in TX
-------------------------------------------------------------
The law firm of Schatz & Nobel, P.C., filed a lawsuit seeking
class action status in the United States District Court for the
Northern District of Texas on behalf of all persons who acquired
the publicly traded securities of Blockbuster, Inc. (NYSE:BBI)
pursuant to the Company's exchange offer of Viacom, Inc.
("Viacom") stock for 144 million common shares of Blockbuster
(the "Exchange Offer"), and on behalf of those who purchased
Blockbuster shares in the open market between September 8, 2004
and August 9, 2005, inclusive (the "Class Period").
The Complaint alleges that defendants violated federal
securities laws by issuing a series of materially false
statements. It is alleged that Viacom caused Blockbuster to pay
a special dividend of which Viacom was the primary beneficiary.
In order to pay the dividend, Blockbuster was forced to take on
debt in the amount of approximately $1.1 billion. In the
Prospectus issued in connection with Viacom's divestiture of its
Blockbuster shares (the "Prospectus"), defendants stated that
Blockbuster planned to transform itself through a series of
initiatives and that Blockbuster's debt obligations would not
impede its transformation.
Unbeknownst to investors, Blockbuster was wholly unprepared to
build the technological infrastructure required to integrate its
in-store and online sales operations and otherwise execute the
Company's transformation. Moreover, the Company's core in-store
rental operations were not generating sufficient cash flow. On
August 9, 2005, Blockbuster reported:
(1) a second-quarter net loss of $57.2 million, or $0.31
per share;
(2) negative free cash flow of $118 million compared to
positive free cash flow of $23 million in the second
quarter of 2004; and
(3) that it was abandoning its 2005 guidance. Blockbuster
also announced that, on August 8, 2005, it had been
forced to amend its credit facility to provide for a
waiver of its leverage ratio covenants.
For more details, contact Wayne T. Boulton or Nancy A. Kulesa of
Schatz & Nobel, P.C., Phone: (800) 797-5499, E-mail:
sn06106@aol.com, Web site: http://www.snlaw.net.
HCA INC.: Charles Piven Lodges Securities Fraud Suit in M.D. TN
---------------------------------------------------------------
The Law Offices Of Charles J. Piven, P.A., filed a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of HCA, Inc.
(NYSE: HCA) between January 12, 2005 and July 12, 2005,
inclusive (the "Class Period").
The case is pending in the United States District Court for the
Middle District of Tennessee against defendant HCA and one or
more of its officers and/or directors. 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 St.,
Suite 2525, Baltimore, MD 21202, Phone: 410/986-0036, E-mail:
hoffman@pivenlaw.com.
HCA INC.: Marc S. Henzel Lodges Securities Fraud Suit in M.D. TN
----------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the Middle
District of Tennessee on behalf of purchasers of HCA, Inc.
(NYSE: HCA) publicly traded securities during the period between
January 12, 2005 and July 12, 2005 (the "Class Period").
The complaint charges HCA and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. HCA is the nation's largest chain of for-profit hospitals.
The complaint alleges that during the Class Period, defendants
caused HCA's shares to trade at artificially inflated prices by
issuing false statements concerning the Company's purported
financial successes while concealing that HCA's operational
metrics had substantially deteriorated. Defendants' positive
statements had their intended effect, inflating the Company's
stock price by almost 50% from less than $40 per share on
January 11, 2005 to its Class Period high of over $58 per share
on June 22, 2005, during which time defendants sold almost 1
million shares of the Company's stock at inflated prices,
pocketing more than $48 million in proceeds.
According to the complaint, on July 13, 2005, HCA issued a
profit warning for its 2Q 2005 disclosing that:
(1) contrary to defendants' statements that HCA had been
experiencing trends beneficial to its "operating
results," in reality the Company was then experiencing
negative operational trends which were driving down
HCA's revenues and decreasing the Company's
profitability;
(2) despite defendants' statements that the Company was
experiencing "a moderation in the growth in its
uninsured patient admissions and emergency room
visits," the Company's uninsured admissions and
emergency room visits were actually increasing more
rapidly than insured admissions and emergency room
visits, which defendants knew was increasing the
Company's bad-debt expense and reducing HCA's
profitability;
(3) notwithstanding defendants' statements lauding the
Company's "favorable change in its estimated provision
for doubtful accounts," and "substantial(ly)
improv(ing) ... financial performance" due to its
"improving bad debt trends," HCA's provision for
doubtful accounts was actually increasing as a
percentage of revenues; and
(4) defendants had materially limited surgeries at certain
hospitals due to illegal misconduct.
On this news, HCA's stock fell approximately $5 per share on
nearly six times the average daily trading volume over the
preceding 12 months. Soon thereafter, the Securities and
Exchange Commission and the U.S. Department of Justice opened
formal investigations into Class Period insider trading at HCA.
For more details, contact Marc S. Henzel, Esq. of The Law
Offices of Marc S. Henzel, 273 Montgomery Ave, Suite 202 Bala
Cynwyd, PA 19004-2808, Phone (888) 643-6735 or (610) 660-8000,
Fax: (610) 660-8080, E-mail: Mhenzel182@aol.com, Web site:
http://members.aol.com/mhenzel182.
HCA INC.: Stull Stull Lodges Securities Fraud Suit in M.D. TN
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The law firm of Stull, Stull & Brody initiated a class action in
the United States District Court for the Middle District of
Tennessee on behalf of all persons who purchased the securities
of HCA, Inc. (NYSE: HCA) between January 12, 2005 and July 12,
2005 (the "Class Period").
The complaint alleges that HCA violated federal securities laws
by issuing false or misleading public statements. On July 13,
2005, HCA issued a profit warning for the second quarter of
2005, disclosing adverse business trends which, according to the
Complaint, were contrary to its previous positive statements and
representations. Prior to this disclosure, the Complaint alleges
that company insiders sold almost one million shares of HCA
stock for more than $48 million in proceeds. After the
disclosure, HCA stock fell from a close of $54.57 on July 12,
2005, to close at $49.74 on July 13, 2005.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, 6 East 45th Street, New York, NY 10017, Phone:
1-800-337-4983, Fax: 212/490-2022, E-mail: SSBNY@aol.com, Web
site: http://www.ssbny.com.
PEGASUS COMMUNICATIONS: Marc Henzel Lodges Securities Suit in PA
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The Law Offices of Marc S. Henzel initiated a class action
lawsuit in the United States District Court for the Eastern
District of Pennsylvania on behalf of purchasers of Pegasus
Communications Corporation (OTC: PGTV.PK) common stock during
the period from November 10, 2000 through June 2, 2004 (the
"Class Period").
The Complaint alleges that Pegasus and certain of its management
violated 10b and Rule 10b-5 of the federal securities laws by
failing to disclose its "exclusive" distribution rights for
DirecTV services could be terminated without cause prior to
2008. On June 2, 2004 Pegasus disclosed that its exclusive
rights to distribute DirecTV services had been terminated. That
same day certain Pegasus' operating subsidiaries filed for
bankruptcy protection, damaging investors.
For more details, contact Marc S. Henzel, Esq. of The Law
Offices of Marc S. Henzel, 273 Montgomery Ave, Suite 202 Bala
Cynwyd, PA 19004-2808, Phone (888) 643-6735 or (610) 660-8000,
Fax: (610) 660-8080, E-mail: Mhenzel182@aol.com, Web site:
http://members.aol.com/mhenzel182.
PIXAR ANIMATION: Glancy Binkow Files Securities Fraud Suit in CA
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The law firm of Glancy Binkow & Goldberg, LLP, initiated a Class
Action lawsuit in the United States District Court for the
Northern District of California on behalf of a class (the
"Class") consisting of all persons or entities who purchased or
otherwise acquired securities of Pixar Animation Studios (the
"Company") (Nasdaq:PIXR) between January 18, 2005 and June 30,
2005, inclusive (the "Class Period").
The Complaint charges Pixar and certain of the Company's
executive officers with violations of federal securities laws.
Among other things, plaintiff claims that defendants' material
omissions and dissemination of materially false and misleading
statements concerning Pixar's operations and prospects caused
the Company's stock price to become artificially inflated,
inflicting damages on investors. Pixar engages in the creation,
development, and production of animated films and related
products worldwide. The Complaint alleges defendants' Class
Period representations were materially false and misleading when
made because:
(1) defendants had intentionally flooded the market with
millions of copies of "The Incredibles" home videos,
far in excess of actual or forecast demand, in an
effort to capitalize on a very narrow sales window;
(2) this flooding strategy had the effect of artificially
inflating reported "The Incredibles" home video sales
in the days immediately following its release, yet at
the expense of future sales and with the effect of
increasing foreseeable home video returns;
(3) as a direct result of this undisclosed flooding
strategy, defendants exposed the Company to significant
undisclosed risks, including the risk that large
numbers of unsold home video units would be returned to
the Company;
(4) defendants' forecasts for the sale of "The Incredibles"
home video units lacked any reasonable basis throughout
the Class Period; and
(5) Pixar lacked an internal system of controls adequate
for the purpose of preventing the dissemination of
materially false and misleading information.
On June 30, 2005, Pixar lowered its second quarter 2005 earnings
guidance to $0.10 per diluted share, down from $0.15, as a
result of disappointing sales of "The Incredibles" home videos
and an increase in Pixar's reserves for video returns. In
reaction to this news, Pixar shares fell from a close of $50.05
per share on June 30, 2005, to close at $43.06 per share on July
1, 2005. On August 26, 2005, Pixar announced that the SEC had
commenced an investigation in connection with Pixar's reported
sales of "The Incredibles" videos, and that the SEC had
"requested information leading up to the filmmaker's report
earlier this month of lower second-quarter earnings."
For more details, contact Lionel Z. Glancy or Michael Goldberg
of Glancy Binkow & Goldberg LLP, 1801 Avenue of the Stars, Suite
311, Los Angeles, CA 90067, Phone: (310) 201-9150 and
(888) 773-9224, E-mail: info@glancylaw.com, Web site:
http://www.glancylaw.com.
*********
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collectively face billions of dollars in asbestos-related
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*********
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Copyright 2005. All rights reserved. ISSN 1525-2272.
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