/raid1/www/Hosts/bankrupt/CAR_Public/060210.mbx
C L A S S A C T I O N R E P O R T E R
Friday, February 10, 2006, Vol. 8, No. 30
Headlines
3-DAY BLINDS: 'Taiwanese' Firm Protests Inclusion in Ill. Suit
ALBERTSONS: Worker Complains of Black, Hispanic Discriminations
BIOMEDICAL TISSUE: Bone Recipient Files Lawsuit in Ind. Court
CALIFORNIA: Students File Lawsuit V. High School Exit Exam
CANADA: Danier Suit Faces Hurdles that Could Affect Future Cases
COCA-COLA ENTERPRISES: To Ask Dismissal of Ga., Del. Lawsuits
FIRST ADVANTAGE: Settles Suit with Blacklisted Tenants for $2M
FIRST HORIZON: Kans. Court Certifies Class in Overtime Lawsuit
FLORIDA POWER: Court Junks Customer Lawsuit over Power Outages
ILLINOIS: Court Rules on CAFA Commencement Issue in Auto Cases
METRO WATER: Court Upholds Status of Workers' Racial Bias Suit
METROPOLITAN LIFE: N.Y. Court Decertifies Class in Rabouin Case
MICROSOFT CORPORATION: NBAPS Get Windfall from Antitrust Deal
MINNESOTA: Hearing Set for Lawsuit V. Minneapolis Police Dept.
MURPHY OIL: Prepares to Appeal Class Certification of La. Suit
NORTEL NETWORKS: Paying $2.4B to Settle Two Securities Lawsuits
NORTEL NETWORKS: Settles Stock Suit with Canadian Fund Manager
NORTH CAROLINA: Efforts to Obtain Secret Recordings Put on Hold
THREEMILE CANYON: Employees Launch Overtime Wage Lawsuit in Ore.
TIME WARNER: Hawaii Pension Funds Join Lawsuit Over AOL Merger
TYSON FRESH: Cattle Producers Urge High Court Review of Pickett
UBS AG: Reaches $89M Settlement on Salary, Hours Litigations
UNITED STATES: ACLU Fights for Students Right to Financial Help
WASHINGTON: City Files Suit V. Web Sites over Lost Hotel Taxes
Asbestos Alert
ASBESTOS LITIGATION: Unitrin Notes US$19M A&E Reserves for 2005
ASBESTOS LITIGATION: Owens-Illinois Pending Claims Drop to 32T
ASBESTOS LITIGATION: Crown Holdings Payments Reach $29M in 2005
ASBESTOS LITIGATION: St Paul Travelers Notes $830M Reserve Boost
ASBESTOS LITIGATION: PA Judge Prohibits Use of Clean Air Fund
ASBESTOS LITIGATION: Japan to Accept Aid Applications by March
ASBESTOS LITIGATION: Coroner Links Engineer's Death to Asbestos
ASBESTOS LITIGATION: Union Deems Omni-Pac Settlement Inadequate
ASBESTOS LITIGATION: Torts Group Issues Litigation Trends Study
ASBESTOS LITIGATION: Todd Shipyards Facing 593 Injury Claims
ASBESTOS LITIGATION: Altria Tackles Remaining Lawsuit in Calif.
ASBESTOS LITIGATION: Hercules Tags 4Q Loss to Asbestos Liability
ASBESTOS LITIGATION: Congoleum Files New Plan of Reorganization
ASBESTOS LITIGATION: Grace Shares Drop Before $140B Fund Debate
ASBESTOS LITIGATION: Bankrupt Firms Not Banking on Payout Bill
ASBESTOS LITIGATION: Owens Corning Exclusivity Extended to July
ASBESTOS LITIGATION: Century to Determine Stay Inapplicability
ASBESTOS LITIGATION: Asarco Seeks Exclusivity Period Extension
ASBESTOS LITIGATION: Court Confirms Kaiser Reorganization Plan
ASBESTOS LITIGATION: Compensation Fund Progresses to Next Stage
ASBESTOS LITIGATION: Property Casualty Opposes Trust Fund Bill
ASBESTOS LITIGATION: Govt. Study Sees US$150B Fund Shortfall
ASBESTOS ALERT: Rodgers' Case Remanded to Clear Succession Issue
ASBESTOS ALERT: Court Reverses Fuller-Austin Bankruptcy Ruling
ASBESTOS ALERT: TX Court Rejects Aleman Appeal in Suit v. Marsh
New Securities Fraud Cases
AMKOR TECHNOLOGY: Stull Stull Files Securities Fraud Suit in Pa.
APPLICA INC.: Schatz & Nobel Files Securities Fraud Suit in Fla.
DOT HILL: Lerach Coughlin Lodges Securities Fraud Suit in Calif.
JARDEN CORP: Roy Jacobs Files Securities Fraud Suit in S.D. N.Y.
LAFARGE NORTH: Bull Lifshitz Files Securities Fraud Suit in Md.
LAFARGE NORTH: Entwistle & Cappucci Files Securities Suit in Md.
ROYAL GROUP: Schiffrin & Barroway Lodges Securities Suit in N.Y.
*********
3-DAY BLINDS: 'Taiwanese' Firm Protests Inclusion in Ill. Suit
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A defendant in the Alsup vs. 3-Day Blinds company lawsuit is
seeking dismissal from the class action for reasons of
jurisdiction, according to Madison County Record.
In a Feb. 6 motion, Beautiful Window Enterprise attorney Brian
Parsons of Chicago told Madison County Circuit Judge Daniel
Stack the suit identified his client as a Texas company;
Beautiful Window has no business in Illinois. Mr. Parsons said
keeping Beautiful in the suit would violate its right to due
process, according to the report.
The Alsup vs. 3-Day Blinds case was initiated last year by
Ronald Alsup of Edwardsville and Robert Crews of Granite City
against dozens of companies that made, distributed or sold
blinds with cords. Attorney Jeffrey Lowe of Clayton stated in
the complaint that dangling cords strangled 339 persons in 30
years. He, however, is not seeking damages for the dead, but
for "hundreds of millions of individuals" who bought blinds.
According to the report some defendants of the class action had
settled, while others had moved to dismiss. Attorney Russell
Scott of Belleville previously filed a pair of motions to
dismiss Richfield Window Coverings from the suit citing failure
to state a cause of action, and lack of jurisdiction and
standing as reasons.
ALBERTSONS: Worker Complains of Black, Hispanic Discriminations
---------------------------------------------------------------
An Albertsons warehouse store employee filed a racial
discrimination suit against the Boise, Idaho-based company on
Feb. 7, according to The Associated Press.
Matthew Ricks alleged in a federal suit the store tolerated
ethic hate speech against black and Hispanic workers, and
discriminated them in work assignments.
The Equal Employment Opportunity Commission investigated the
allegations. It plans a class action suit against the
nationwide chain on behalf of at least 200 black and Hispanic
employees stemming back to 1995, according to the lawsuit.
Albertsons -- http://www.albertsons.com/-- owns and operates 19
distribution centers in 37-state operating area. Its
distribution centers are in Arizona, California, Colorado,
Florida, Idaho, Illinois, Oklahoma, Oregon, Pennsylvania, Texas,
and Utah.
BIOMEDICAL TISSUE: Bone Recipient Files Lawsuit in Ind. Court
-------------------------------------------------------------
A man who received bone transplant from Biomedical Tissue
Services Ltd. is suing the company for negligence, according to
the Indianapolis Star.
Brian Springer filed a suit seeking class-action status in
Marion Superior Court earlier this month. He is accusing
Biomedical Tissue of intentionally acquiring human tissue
harvested from bodies entrusted to New York funeral homes
without obtaining consent from families of the deceased,
according to the report. He is also claiming that the company
failed to test the bone, skin and tendons for diseases.
Mr. Springer, who had surgery to repair a herniated disk, did
not test positive for any disease, but his attorney, Richard E.
Shevitz, said his client is worried. The suit is thus seeking
damages for negligence and negligent infliction of emotional
distress. The suit did not specify damages claims. Mr.
Springer is requesting a jury trial before Marion Superior Court
Judge Cale Bradford. He is advised by the law firm of Cohen &
Malad.
Mr. Springer's case is the latest to be filed against Biomedical
Tissue in several states, including New Jersey, according to the
report.
The U.S. Food and Drug Administration ordered Biomedical Tissue
Services to stop manufacturing operations after an investigation
by the agency revealed "serious and widespread" deficiencies in
the firm's activities, Business New Jersey reports (Class Action
Reporter, Feb. 8, 2006).
Authorities investigated the Fort Lee, New Jersey firm after
allegations emerged it used harvested tissue taken from funeral
homes without proper permission.
CALIFORNIA: Students File Lawsuit V. High School Exit Exam
----------------------------------------------------------
Ten students from California filed a complaint against the state
over the high school exit exam that stands to keep 100,000
students from the class of 2006 from graduating, according to
the San Jose Mercury News.
Five Richmond High School students and five others from around
California filed a lawsuit with the San Francisco Superior Court
against state Superintendent Jack O'Connell, the State of
California, the state Department of Education and the state
Board of Education as defendants, the report said. Students
named in the complaint come from Hayward, Newark, Oakland, Fair
Oaks and Rialto, according to the report.
Lawyer Arturo Gonzalez of San Francisco firm Morrison Foerster
considered the standardized test 'unfair', 'unwise' and
"illegal'. The test is required for a diploma starting this
year. The class of 2006 will be the first to be denied a
diploma if they don't pass the state standardized test. About
22 percent of this year's senior class, which is roughly 100,000
students, did not pass the test as of last spring, according to
an independent evaluator's report prepared for the state
Education Department (Class Action Reporter, Jan. 4, 2006).
Mr. O'Connell believed the test helped students by holding them,
and public schools, to high standards, according to his press
secretary, Hilary McLean.
But the plaintiff's argument, according to the report, states:
(1) by denying a diploma to students who would otherwise
graduate the state would be depriving them of their
fundamental right to public education;
(2) the state violated the equal protection clause of the
California Constitution by providing inadequate
instruction in the first place and unfairly
distributing money dedicated to helping students pass
the test; and
(3) the state violated California's due process law when by
failing to thoroughly research alternatives as mandated
by the Legislature when it approved the exit exam in
1999.
Options suggested by the evaluators include allowing students to
submit a portfolio of work that proves they have mastered
certain math and English skills or creating an alternative
diploma or certificate for students who complete their K-12
courses but don't pass the test. State Superintendent of Public
Instruction Jack O'Connell is currently reviewing possible
options (Class Action Reporter, Jan. 4, 2006).
CANADA: Danier Suit Faces Hurdles that Could Affect Future Cases
----------------------------------------------------------------
The Danier Leather Inc. shareholder suit still faces two
important legal hurdles that could significantly affect the
future course of investor lawsuits despite its dismissal by the
Ontario Court of Appeal in December, The Globe and Mail reports.
Peter Jervis, one of the lawyers who argued the suit against the
Company and two senior executives, said he would seek leave to
appeal a recent decision to the Supreme Court of Canada. The
application is expected to trigger a lively debate among
litigators over whether the landmark class action that tested
the disclosure practices of public companies meet the Supreme
Court's criteria of hearing only those cases that are of public
importance or raise key issues of law.
While the High Court mulls the application, litigation experts
are eagerly waiting for an Ontario Court of Appeal decision,
expected later this month, about who should foot the legal
costs. Previously, the Ontario Court of Appeal allowed its
appeal from the May 2004 judgment of the Superior Court of
Justice (Ontario) in the matter of a class action concerning the
Company's initial public offering in 1998. In its unanimous
decision, a panel of the Court allowed the appeal on three
separate grounds, set aside the trial decision and dismissed the
class action.
The decision stated that the Company met its statutory
disclosure obligations during the IPO process. It noted that
the Company's achievement of its financial forecast was a
relevant consideration. It also said that greater deference
should have been accorded the business judgment of the Company's
senior management -- judgment that turned out to be correct,
(Class Action Reporter, Dec. 19, 2005).
The case attracted national attention because it marks the first
action by an investor in Canada claiming to have been misled by
a public company's statements. Essentially, the Company was
accused of printing overly rosy forecasts in a prospectus for
its initial public offering of stock in 1998. Subsequent to the
retailer's IPO, the retail chain issued disappointing sales
numbers citing poor weather conditions.
When the appeal court overturned the lower court decision, Mr.
Jervis of Lerners, LLP, and his client, Rick Durst, saw a $10-
million damages claim and a rare $1-million premium award go up
in smoke. Mr. Jervis told The Globe and Mail that unlike some
litigation boutiques, Lerners does not indemnify its clients
against costs. This means that Mr. Durst, a retired Bay Street
financier, could be facing more than a million dollars in legal
bills for a case that involved over 40 days of trial, two courts
and three sets of lawyers.
Mr. Jarvis reiterates, "The stakes of this cost award are very
high. The chilling effect on future shareholder class suits
will be very significant if the court orders the plaintiff to
pay all the costs."
The Company's attorneys, Lenczner Slaght Royce Smith Griffin
LLP, and lawyers for two of the retailer's executives, Goodmans
LLP, have argued it would be unfair not to make Mr. Durst pay
the legal bills because the case has cost the retailers and its
officers so much time and money.
However, Mr. Jervis countered that his client shouldn't pay
costs because current legislation allows courts to waive
plaintiff costs in unsuccessful class actions if the case is
novel and in the public interest. He pointed out, "This was a
novel and important case that should be shielded from cost
awards. Any other outcome would be a very unpleasant scenario
for all shareholders."
COCA-COLA ENTERPRISES: To Ask Dismissal of Ga., Del. Lawsuits
-------------------------------------------------------------
Coca-Cola Enterprises (CCE) Inc. Chairman and Chief Executive
Officer Lowry F. Kline dismissed recent lawsuits filed against
the company as 'totally without merit.'
"[I]n due course we will ask that each suit be dismissed," Mr.
Kline said. The lawsuits, filed in U.S. District Court in
Atlanta and the Delaware Court of Chancery, attack CCE's public
disclosures regarding sales expectations, reported results and
other business practices. The suit filed in Atlanta seeks class
action status.
Coca-Cola Enterprises Inc. -- http://www.cokecce.com-- (NYSE:
CCE) is distributor, and producer of bottled and canned liquid
non-alcoholic refreshment. It sells approximately 80 percent of
The Coca-Cola Company's bottle and can volume in North America
and is the sole licensed bottler for products of The Coca-Cola
Company in Belgium, continental France, Great Britain,
Luxembourg, Monaco, and the Netherlands.
The Atlanta case is styled "Carpenters Health, et. al. v. Coca-
Cola Co, et. al (1:00-cv-02838-WBH)," filed in the U.S. District
Court for the Northern District of Georgia under Judge Willis B.
Hunt Jr. Representing the plaintiff(s) are David Andrew Bain of
Chitwood Harley Harnes, LLP, 1230 Peachtree Street, N.E., 2300
Promenade II, Atlanta, GA 30309, Phone: 404-873-3900; E-mail:
dab@classlaw.com; and Mary K. Blasy of Lerach Coughlin Stoia
Geller Rudman & Robbins, 655 W. Broadway
Suite 1900, San Diego, CA 92101-4297, Phone: 619-231-1058, E-
mail: maryb@lerachlaw.com.
Representing the defendant(s) are Jeffrey S. Cashdan of King &
Spalding, 191 Peachtree Street, N.E., Atlanta, GA 30303-1763,
Phone: 404-572-4600, E-mail: jcashdan@kslaw.com; and Stephen B.
Devereaux of King & Spalding, 191 Peachtree Street, N.E.,
Atlanta, GA 30303-1763, Phone: 404-572-4600; E-mail:
sdevereaux@kslaw.com.
FIRST ADVANTAGE: Settles Suit with Blacklisted Tenants for $2M
--------------------------------------------------------------
A lawsuit on behalf of tenants wrongly blacklisted for previous
conflicts with landlords was tentatively settled for almost $2
million this month, according to the Gotham Gazette.
First Advantage Safe Rent, formerly First American Registry,
Inc., agreed to compensate 35,000 tenants who suffered a fate
similar to that of lead plaintiff Adam White. The settlement
was filed on February 3 for review and approval by the federal
court. James B. Fishman of Fishman & Neil, LLP is one of the
attorneys who filed the suit on behalf of the class.
Mr. White was subjected to eviction proceedings in 1996 because
he refused to pay rent to his landlord to demand that the latter
repair a serious leak in his ceiling. The matter was settled
amicably, but Mr. White was listed in the tenant screening
company's record of troublesome tenants. He only discovered
this six years later when a prospective landlord denied his
application to move to a new place.
According to the report, if the court approves the settlement,
First American Registry will likely make significant changes the
contents of its record. It might include outcomes of the cases
to avoid wrongly labeling tenants as troublemakers and
blacklisting them. According to tenant advocates many of the
300,000 cases filed in housing court every year -- most of them
non-payment cases -- are withdrawn or discontinued. Sometimes,
the landlord discovers that the case was filed in error, or
tenants have valid reasons for not paying the rent.
FIRST HORIZON: Kans. Court Certifies Class in Overtime Lawsuit
--------------------------------------------------------------
The United States District Court for the District of Kansas
conditionally certified a class in the suit styled, "Linda
Gieseke v. First Horizon Home Loan Corporation."
The plaintiffs in the complaint are loan originators for the
Company. They filed the lawsuit on behalf of similarly situated
employees and former employees under section 16(b) of the Fair
Labor Standards Act ("FLSA"), 29 U.S.C. Section 216(b), to
recover unpaid overtime compensation. They are also seeking
state law claims for quantum meruit and violation of the Kansas
Wage Payment Act.
According to court papers, the matter is before the court on
Plaintiffs' Motion for Conditional Collective Action
Certification Pursuant to 29 U.S.C. Section 216(b) (Doc. 62).
In essence the motion only concerns their FLSA claims. Court
papers revealed that plaintiffs also filed a motion to certify a
class action regarding their state law claims.
The suit is styled, "Gieseke et al v. First Horizon Home Loan
Corp., Case No. 2:04-cv-02511-CM-GLR," filed in the U.S.
District Court for the District of Kansas under Judge Carlos
Murguia with referral to Judge Gerald L. Rushfelt. Representing
the Plaintiff/s are, Virginia Stevens Crimmins and George A.
Hanson of Stueve Siegel Hanson Woody, LLP, 330 West 47th Street,
Suite 250, Kansas City, MO 64112, Phone: 816-714-7100, Fax:
816-714-7101, E-mail: crimmins@sshwlaw.com and
hanson@sshwlaw.com. Representing the Defendant/s are, William
T. Fiala, Frederick J. Lewis and James R. Mulroy, II, Lewis
Fisher Henderson Claxton & Mulroy, LLP, 6410 Poplar Ave., Suite
300, Memphis, TN 38119, Phone: 901-767-6160, Fax: 901-767-7411,
E-mail: williamf@lfhc.com, fredl@lfhc.com and jrmulroy@lfhc.com.
For more details, visit: http://researcharchives.com/t/s?522.
FLORIDA POWER: Court Junks Customer Lawsuit over Power Outages
--------------------------------------------------------------
Broward Circuit Court Judge Victor Tobin rejected on Feb. 8 a
negligence lawsuit filed against Florida Power & Light Co.,
according to Miami Herald.
Customers alleged "gross negligence" on the firm's part to
maintain power system after hurricane Katrina left 5% of homes
in Broward and Miami-Dade in the dark last year.
Judge Tobin dismissed the suit with prejudice, saying the Public
Service Commission, not the courts, had the authority to govern
utilities. He dismissed:
(1) Count I alleging the utility breached its contract with
customers to "provide continuous electricity and to
ensure that power outages do not occur;" and
(2) Count II, alleging gross negligence by FPL in failing
to provide proper service.
He intends to allow the second claim to be amended and refilled,
however. Randy Rosenblum, attorney for the plaintiffs, said he
planned to re-file within the required 20 days.
Lawyer Alvin P. Davis of Squires, Sanders who is representing
FPL, has filed a request that the plaintiffs' attorneys pay
FPL's fees and costs in the case, the report said.
A similar lawsuit, which was filed in Miami-Dade circuit court
after Hurricane Wilma, has already been voluntarily withdrawn
because just like the Katrina case, the PSC is the proper
authority to deal with it.
Attorneys for the defendants alleged that millions of its
customers lost power during Hurricane Wilma because of the
company's "gross negligence in its failure to properly maintain,
secure and protect its utility poles and substations," The South
Florida Sun-Sentinel reports (Class Action Reporter, Nov. 22,
2005).
ILLINOIS: Court Rules on CAFA Commencement Issue in Auto Cases
--------------------------------------------------------------
The United States Court of Appeals for the Seventh Circuit made
a ground breaking ruling over whether the addition of a new
defendant to a suit filed before the effective date of the Class
Action Fairness Act (CAFA) of 2005 "commences" a new action,
according to McGlinchey Stafford of http://www.cafalawblog.com.
Essentially, the court's ruling concerns what happens when new
plaintiffs come on board a case post-CAFA. The cases involved
are: "Phillips v. Ford Motor Company," and "Boxdorfer v.
DaimlerChrysler Corporation."
In its two-case opinion authored by Judge Richard Allen Posner,
the Seventh Circuit declared that the recent addition of
plaintiffs related back to the original pre-CAFA filing, and
therefore these amendments did not commence new actions under
the Class Action Fairness Act. The Judge began his analysis by
concisely framing the issue in both cases as whether amending a
complaint to add or substitute named plaintiffs commences a new
suit. If so, these amendments would effectively commence new
suits post-CAFA, and could therefore be removed to federal court
under CAFA's expanded federal jurisdiction. Relying heavily on
"Schorsch v. Hewlett-Packard Co., 417 F.3d 748, 749 (7th Cir.
2005)," Judge Posner established that "a routine amendment to
the complaint does not commence a new suit."
However, Judge Posner questioned whether adding a plaintiff to a
class action should be considered "routine." Considering that
the substitution of unnamed class plaintiffs for named class
plaintiffs that are no longer members of the litigation was
rather routine, the judge was likely tempted to label the
amendments commonplace and move on.
But, as Judge Frank Hoover Easterbrook analogized in Schorsch,
"tacking a wholly distinct claim onto an old suit . . . might
commence a new proceeding," just as adding a defendant post-CAFA
commences a new suit and allows for removal since suit against
it would not have commenced until after CAFA's effective date.
Thus, Judge Posner took note of this observation and dug a
little deeper.
After ironing out a "jurisdictional wrinkle," Judge Posner
turned to Illinois state law since the relation-back issue
depended on state procedural law and both suits originated in
Illinois state court. After recognizing, as in virtually all
commencement cases, that "an amendment relates back when it
arises out of the same transaction or occurrence set up in the
original pleading," the court considered the facts and
procedural history of each case.
The changes to the class complaining of the paint jobs on their
Ford automobiles were basically "routine," Judge Posner
believed, since the plaintiffs who owned 1996 model Fords added
in the amendment were actually included in the original pre-CAFA
complaint but subsequently amended out of the class.
The additions to the class complaining of the DaimlerChrysler
paint jobs were previously unnamed class members who were named
due to a potential bar of the originally named plaintiffs'
claims by the statute of limitations. Thus, these plaintiffs
were also members of the class at the pre-CAFA filing of the
original complaint.
Judge Posner was sensitive to the importance of the relation
back determination to the unnamed class members, especially
regarding the statute of limitations implications. If the
statute of limitations on the named plaintiff's claims had run,
and the amendments to the original complaint did not relate
back, the class would be barred from relief.
However, due to Illinois' liberal relation-back doctrine
generously tolling the statute of limitations for class members,
and the satisfaction of the relation-back test, Judge Posner
concluded that both set of amendments related back to their
original pre-CAFA complaints. Therefore, adding these new named
plaintiffs to each class failed to commence new actions under
CAFA. Affirming the district court in each case, the Seventh
Circuit concluded both actions must be remanded.
McGlinchey Stafford points out that the "jurisdictional wrinkle"
referred to by Judge Posner is notable in that the class against
DaimlerChrysler had not been certified as of the time of the
drafting of his opinion, thus, the judge reasoned that a class
action did not exist, so a dismissal of the named plaintiffs
would, in effect, terminate the suit. "If the case is later
restarted with a new plaintiff, it is a new commencement, a new
suit," and would be removable under CAFA. However, Judge Posner
observed that the courts shouldn't be so strict, and ignored
this "jurisdictional void" by allowing new class members to step
in after the previously named plaintiffs were dismissed pre-
class certification.
Visit: http://researcharchives.com/t/s?526(Philips Opinion),
http://researcharchives.com/t/s?527(Boxdorfer Opinion) and
http://researcharchives.com/t/s?49b(Schorsch Opinion).
METRO WATER: Court Upholds Status of Workers' Racial Bias Suit
--------------------------------------------------------------
The United States Court of Appeals for the Sixth Circuit in
Tennessee is standing by its October 2005 decision upholding
class-action status in a racial discrimination lawsuit filed by
nine employees against Metro Water Services, The Nashville City
Paper reports.
Previously, Metro asked the 6th Circuit to rehear the matter
before the full court, rather than in front of only three
judges, but was denied the request on Jan. 27. Last October,
the court denied Metro's appeal of an August order by U.S.
District Court Judge William Haynes making the suit a class
action.
In that October ruling, the court pointed out that a case may be
"especially appropriate" for appeal if granting class status
"propels the litigation into a high-stakes game such that the
defendant is more likely to settle than litigate," or if denying
class status "discourages the individual plaintiff from
continuing due to the expense of litigation." Such is not the
situation in this case, however, according to the court's order,
(Class Action Reporter, Nov. 9, 2005).
The suit, entitled, "Grant, et al. vs. Metro Government of
Nashville and Davidson County, Tennessee," was filed in 2004 by
nine black Water Services employees and alleges racially
disparate pay, promotion, job assignments, supervision,
discipline and accommodations.
According to the Nov. 9, 2005 issue of the Class Action
Reporter, the nine named plaintiffs are:
(1) application tech Princess A. Martindale,
(2) plumber Darrell W. Gant,
(3) office support representative Pamela N. Tucker,
(4) administrative services manager Claude P. Grant,
(5) water maintenance leader Antonio D. McKissack Sr.,
(6) administrative services officer Sandra J. Derrick,
(7) maintenance and repair leader Darryl L. McKibben,
(8) administrative services officer Faletha B. Reid, and
(9) former equipment operator Oralene Day, who is the only
plaintiff no longer with the department.
The plaintiffs are all seeking injunctive relief, which would
prohibit any future discriminatory practices, and compensatory
damages for pain, suffering and mental anguish, (Class Action
Reporter, Nov. 9, 2005). The class certification allowed the
case to proceed on behalf of all former, current and future
black Metro Water employees since January 2000. The plaintiffs
have said there are more than 175 such men and women.
The lawsuit alleges former Metro Water Services Human Resources
Manager Robin Brown, who is black, contributed to the problem by
not being receptive to the employees' concerns. Ms. Brown is
now a human resources manager at Metro's Department of Human
Resources.
In the past, Martin D. Holmes, who represents the plaintiffs in
the case, told The Nashville City Paper, "The claim is that,
historically, African Americans have been discriminated against
in the terms and conditions of their employment, including
promotions and pay as well as other acts. We have argued that
blacks are disciplined more frequently and more severely than
similarly situated white individuals."
However, Metro attorney Brooks Fox maintained, ". We feel as
though, on these particular ones, we have a defense that every
action was taken with nondiscriminatory reasons."
With the appellate court's recent decision, the trial will go on
as earlier scheduled on Nov. 14.
The suit was styled, "Grant, et al v. Metro Govt of Nash, et a,
3:04-cv-00630," filed in the United States District Court for
the Middle District of Tennessee under Judge William J. Haynes.
Representing the Plaintiff/s is, Martin D. Holmes of Stewart,
Estes & Donnell, SunTrust Center, 424 Church St., 14th Floor
Nashville, TN 37219-2392, Phone: (615) 244-6538, E-mail:
mdholmes@sedlaw.com. Representing the Defendant is J. Brooks
Fox of Metropolitan Legal Department, 204 Metro Courthouse,
Nashville, TN 37201, Phone: (615) 862-6341, E-mail:
brooks.fox@nashville.gov.
METROPOLITAN LIFE: N.Y. Court Decertifies Class in Rabouin Case
---------------------------------------------------------------
The Appellate Division, First Department unanimously reversed a
November 2004 court order in the case styled, "Joyce Rabouin v.
Metropolitan Life Insurance Company," an action pending before
Justice Herman Cahn of the Commercial Division of the New York
State Supreme Court in New York County, essentially decertifying
the class.
Previously, the 2004 court order had certified a nationwide
class of an estimated 6.6 million policyholders for plaintiffs'
breach of contract claim and a New York subclass for plaintiffs'
GBLSection349 (unfair business practices) claim. Plaintiffs had
claimed that class members were entitled to more than $720
million in damages.
The lawsuit challenged the Company's allocation of income from
real estate investments made during the 1970s and 1980s. It
claims that as a result of such allocation, certain owners of
participating life insurance policies received dividends during
the 1990s that were lower than they should have been.
Originally, the named plaintiff, Joyce Rabouin, pleads claims
for breach of contract (first cause of action), breach of
fiduciary duty (second cause of action), violation of General
Business Law Section 349 (third cause of action), and seeks an
accounting (fourth cause of action).
In reversing the trial court's class certification decision, the
Appellate Division, First Department found that plaintiffs'
breach of contract claim raised issues such as parol evidence,
the resolution of which necessarily required the application of
the law of jurisdictions other than New York. The Court found
that these "contract-related considerations," coupled with the
fact that approximately 30 percent of the prospective class
resided in jurisdictions with a statute of limitations shorter
than New York's, rendered a nationwide class inappropriate. The
Court also decertified the New York subclass, finding that a
necessary element of plaintiffs' GBLSection349 claim whether the
allegedly deceptive acts were misleading in a material way
required resolution of individual issues that precluded class
treatment.
The reversal was handed down just six weeks after the Company
was granted summary judgment in the trial court on plaintiffs'
two remaining causes of action.
For more details, contact Jeffrey S. Lichtman of Skadden, Arps,
Slate, Meagher & Flom, LLP, Phone: 212-735-2378, Fax:
917-777-2378, E-mail: jlichtma@skadden.com, Web site/s: (Court
Opinion) http://researcharchives.com/t/s?524or (Skadden News
Release) http://researcharchives.com/t/s?525.
MICROSOFT CORPORATION: NBAPS Get Windfall from Antitrust Deal
-------------------------------------------------------------
Minnesota's North Branch Area Public Schools (NBAPS) will
receive $179,000 to purchase computers and software from the
settlement of a state class-action suit against Microsoft
Corporation, The East Central Minnesota Post Review reports.
The amount is part of the $55.2 million schools statewide will
receive in vouchers, according to information released Jan. 30
from Gov. Tim Pawlenty's office. Initially, the Company agreed
to pay $174.5 million in vouchers to businesses and consumers in
Minnesota. Schools in the state could later claim what
consumers did not, (Class Action Reporter, Feb. 9, 2006).
In 2000, the Company faced a flurry of lawsuits back for using
its market power to force customers to pay higher prices for its
Windows operating system. Those federal cases were later
consolidated in the United States District Court for Maryland.
These cases allege that the Company competed unfairly and
unlawfully monopolized alleged markets for operating systems and
certain software applications, and they seek to recover alleged
overcharges for these products, (Class Action Reporter, Feb. 6,
2006).
To date, courts have dismissed all claims for damages in cases
brought against the Company by indirect purchasers under federal
law and in 17 states. Nine of those state court decisions have
been affirmed on appeal. An appeal of one of those state
rulings is pending. There was no appeal in four states. Claims
under federal law brought on behalf of foreign purchasers have
been dismissed by the U.S. District Court in Maryland as have
all claims brought on behalf of consumers seeking injunctive
relief under federal law, (Class Action Reporter, Nov. 2, 2005).
The ruling on injunctive relief and the ruling dismissing the
federal claims of indirect purchasers are currently on appeal to
the United States Court of Appeals for the Fourth Circuit, as is
a ruling denying certification of certain proposed classes of
U.S. direct purchasers. Courts in eleven states have ruled that
indirect purchaser cases may proceed as class actions, while
courts in two states have denied class certification, (Class
Action Reporter, Nov. 2, 2005).
Statewide, 467 school districts and charter schools will receive
vouchers intended to supplement current technology budgets,
updating computer software and hardware and enhancing
professional development for teachers and staff, (Class Action
Reporter, Feb. 9, 2006).
The monies given to individual school districts are based on
their percentage of students receiving free and reduced-price
meals. According to details of the settlement, school districts
may use the money for hardware, software or technology training
purposes. The money must be used to "supplement," not "supplant
or replace" technology systems within school districts. It must
be spent by Jan. 12, 2012.
MINNESOTA: Hearing Set for Lawsuit V. Minneapolis Police Dept.
--------------------------------------------------------------
A federal class action lawsuit by Daryl Robinson against the
Minneapolis Police Department (MPD) is slated to go to court on
Feb. 15 and 16, The Pulse of the Twin Cities reports.
Mr. Robinson, the suit's lead plaintiff, is a clean-cut African-
American man. According to the suit, he was walking to his car
after buying some seltzer water when a Minneapolis police
cruiser intercepted him with interrogation that implied he was a
criminal. When Mr. Robinson, who has no criminal record, said
that he felt "harassed," one of the officers got out of the car
and beat him to the ground. After rupturing Mr. Robinson's
eardrum, the officer poured seltzer water into the bleeding ear,
hit Mr. Robinson's head with the bottle and said, "Now, that's
harassment!"
The suit goes on to state that after being left lying in the
alley, Mr. Robinson drove himself to Hennepin County Medical
Center and had his abuse complaint taped by a Minneapolis
sergeant. Subsequently, MPD said that tape was "lost." For a
year and a half, Mr. Robinson went to MPD's Internal Affairs and
continued to insist on having his complaint investigated. The
only response he got was an official telling him if he "kept
complaining, the harassment will get worse."
Michelle Gross, co-founder of Communities United Against Police
Brutality (CUAPB) told The Pulse of the Twin Cities, "Daryl
Robinson is a very brave man, who's continued to stand up." She
said of Mr. Robinson's current state that, "The harassment
doesn't end just because you stand up for your rights. They're
still trying to keep him from standing up for his rights. He
had so many racial-profile traffic stops, he quit driving!"
The class action lawsuit is the latest attempt by community
organizers to change MPD policies and practices that lead to
police abuses. In August 2002, several shootings by Minneapolis
Police culminated with a 10-year-old North Minneapolis African-
American boy being shot in the arm, leading to what's been
alternatively described as the Jordan neighborhood uprising or
the Jordan neighborhood riot.
CUAPB activists made that night a catalyst to finally get the
Department of Justice to intervene with mediators. Going door
to door for months, CUAPB activists gathered grassroots demands,
creating a 10-page document about the police changes people
wanted. Community representatives were elected to participate
in the mediation.
According to Ms. Gross, though, "The City couldn't stand the
idea of not controlling the process. All the people the
community elected were booted off the team. So, the City not
only chose who represented them, but also handpicked the
community team as well, and a fair number were in the City's
pocket."
"So, they weren't going to demand anything," Ms. Gross tells The
Pulse of the Twin Cities. She also described the failed
mediation with obvious frustration by saying, "The 10-page
document never saw the light of day! The mediation agreement
that resulted is weak, has no enforcement and doesn't ask police
to do anything. It's got very little tangible benefit to the
community at all."
To prepare for the lawsuit, CUAPB analyzed hundreds of
complaints, identifying five representative plaintiffs and the
policies and practices they seek to change such as excessive
force, false charges made against brutality victims (to
discourage complaints), Internal Affairs' inaction, witness
intimidation, and serious harassment of brutalized victims who
seek redress.
Ms. Gross pointed out, "Take the example of duty logs all
officers are supposed to fill out. That's the policy, but the
practice is often they're not done or not turned in. This makes
the police less accountable to the community, so you don't even
know which officers were at the scene of an incident!" She
explained. "Also, without these logs, they can change their
stories later."
The City of Minneapolis has paid out over $14M in individual
police brutality cases in recent years. According to Ms. Gross,
"At one point, the City told our lawyers they'd rather pay out
money than make policy changes. The police federation and the
DFL have close ties because the federation gives endorsements
and campaign contributions. The City is willing to give out our
tax dollars as long as they don't have to confront the
federation."
Ms. Gross reiterates, "This lawsuit is about changing the
conditions that allow police brutality to occur. The idea is to
make things better, which you can't do with individual cases."
City Attorney, Tim Skarda, commented by phone, "We've made a
tentative agreement on policy matters with some details to be
worked out." He expounds that one of the remaining points to be
addressed in the hearing is enforcement and who will monitor the
agreement. One possibility is the federal court could provide
oversight and CUAPB would participate in the monitoring.
In addition, Mr. Skarda told The Pulse of the Twin Cities that
damages for four of the five plaintiffs in the lawsuit have been
agreed to with only Mr. Robinson remaining. None received
punitive damages, instead they only had medical bills and lost
wages paid by the City. As is standard in class action
lawsuits, legal expenses will likely be reimbursed.
Commenting on the upcoming hearing, Ms. Gross told The Pulse of
the Twin Cities, "The lawsuit hearing will be very exciting
because Daryl will finally be heard. No boring preliminaries,
but the real meat of what's happening to people. We really need
to fill up the courtroom with the community. This is one of the
most important cases in decades."
The suit was styled, "Robinson v. Minneapolis, City of, et al,
Case No. 0:03-cv-02897-DWF-SRN," filed in the U.S. District
Court for the District of Minnesota under Judge Donovan W. Frank
with referral to Susan R. Nelson. Representing the Plaintiff/s
is Jill Clark of Jill Clark, PA, 2005 Aquila Ave., N. Golden
Valley, MN 55427, Phone: 763-417-9102, Fax: 763-417-9112, E-
mail: jill@jillclarkpa.com. Representing the Defendant/s is
Timothy S. Skarda, Minneapolis City Attorney's Office, 333 S.
7th St., Ste. 300, Mpls, MN 55402-2453, Phone: 612-673-2553,
Fax: 612-673-3362, E-mail: Timothy.Skarda@ci.minneapolis.mn.us.
For more info, see Communities United Against Police Brutality
Web site at CUAPB.org or call 612-874-7867.
MURPHY OIL: Prepares to Appeal Class Certification of La. Suit
--------------------------------------------------------------
Murphy Oil Corp. is preparing to appeal a recent class-action
certification of the case involving an oil spill at its
Louisiana refinery during Hurricane Katrina, The Arkansas
Democrat-Gazette reports.
As the scope of litigation emerges, the Company expects to file
an appeal with the 5th U. S. Circuit Court of Appeals this week,
according to George Frilot, an attorney for the El Dorado-based
company.
The suit, which was filed by property owner Patrick Joseph
Turner on behalf of at least 500 property owners in St. Bernard
Parish, states, "as a direct and proximate cause of the
negligence of the defendant, plaintiffs sustained damages that
include contamination of property, mental anguish, emotional
distress, inconvenience, loss of use, loss of property value,
loss of income, loss of profits, loss of business opportunity
and fear of cancer," (Class Action Reporter, Sept. 20, 2005).
The spill sent some 85,000 barrels of crude oil from a storage
tank at the Company refinery into the surrounding community and
drenched houses in several feet of oily sludge. The August 29
hurricane and the flooding that followed devastated St. Bernard
Parish, which lies to the east of New Orleans and had a pre-
storm population of almost 70,000 people, (Class Action
Reporter, Jan. 16, 2006).
U.S. District Judge Eldon Fallon's decision centers on an area
in St. Bernard's Parish. The Company has said that the spill
affected only about one square mile and 2,900 residences. But
those bringing the lawsuit say the spill affected six square
miles and about 10,000 residences, (Class Action Reporter, Feb.
2, 2006).
The size of U. S. District Judge Eldon Fallon's certification
area fell somewhere between. He said though that the boundaries
could change.
Claiborne Deming, the Company's president and chief executive
officer, told The Arkansas Democrat-Gazette recently that during
a conference call that the certified area "covers about 2 square
miles" and "up to 6, 000 residences." That includes more than
2, 000 residences with which Murphy has settled, he adds. "We
continue to believe that we are adequately insured and there is
no material adverse impact on the company," Mr. Deming said
during the call.
The Company said during the recent certification hearing in New
Orleans that it had paid out more than $50 million through its
settlement program for about 1, 800 residences. That didn't
include the more than $13 million it paid for cleanup of public
property and more than $4 million spent on private-property
work.
The Company contended that damage varies, so treating the case
as a class with uniformity is not justified. It also does not
view residences that have settled as being part of the class,
Mindy West, a Murphy spokesman told The Arkansas Democrat-
Gazette.
On Aug. 29, 2005, the Company's Meraux, La., spilled about 1
million gallons of oil in the aftermath of Hurricane Katrina,
which struck the Gulf Coast. Some of the oil leaked into the
surrounding area, sparking litigation against the Company.
The plaintiffs argue in court filings that the Company was
negligent. The Company has denied that.
According to a notice to residents and property owners that was
approved by Judge Fallon, "If you want to participate in the
class action and you are within the class area as defined in
this notice, you do not need to take any action at this time.
If you are a member of the class, Murphy Oil is legally
prohibited from dealing with you individually or directly
concerning your claim."
Judge Fallon decided that residents could opt out of the class-
action litigation if they inform both sides before June 1. The
notice further states that people who don't want to participate
must opt out by writing, faxing or e-mailing Sidney Torres,
liaison counsel for the plaintiffs, and Kerry Miller, liaison
counsel for the Company. It also says people might want to talk
with an attorney before deciding not to be part of the class.
The document goes on to state, "If you opt out of the class
action, you are responsible for either settling your claim with
Murphy or bringing your own lawsuit against Murphy in connection
with the... spill. If you opt out, you will not be able to
share in monetary damages, if any, that the Plaintiffs may
obtain in this litigation." It further says the case "is
proceeding to trial while the appeal of certification is
pending." Aug. 14 is the date set for the trial's first phase,
which "will determine Murphy Oil's liability, if any, for the
spill at issue," the notice says.
The suit was styled, "Turner v. Murphy Oil USA, Inc., Case No.
2:05-cv-04206-EEF-JCW," filed in the U.S. District Court for the
Eastern District of Louisiana, under Judge Eldon E. Fallon with
referral to Judge Joseph C. Wilkinson. Representing the
Plaintiff/s is Mickey P. Landry of Landry & Swarr, LLC, 1010
Common St., Suite 2050, New Orleans, LA 70112, Phone:
504-299-1214, E-mail: mlandry@landryswarr.com and Joseph M.
Bruno of Bruno & Bruno, 855 Baronne St., New Orleans, LA 70113,
Phone: (504) 525-1335, E-mail: jbruno@brunobrunolaw.com.
Representing the Defendant/s is George A. Frilot, III of Frilot
Partridge Kohnke & Clements (Lafayette), 107 Global Circle,
Lafayette, LA 70503, Phone: 337-988-5422, E-mail:
gfrilot@fpkc.com.
NORTEL NETWORKS: Paying $2.4B to Settle Two Securities Lawsuits
---------------------------------------------------------------
The Ontario Teachers' Pension Plan Board (OTPP) and several
plaintiffs reached agreement in principle with Nortel Networks
Corp. to settle two major securities-related class actions. The
conditional settlement is for approximately $2.4 billion in cash
and Nortel common stock (all figures in U.S. dollars and at the
current NYSE price). OTPP is a court-appointed Co-Lead
Plaintiff in the securities class actions.
"We pursued this class action on our 250,000 members' behalf and
are pleased with the tentative settlement," said Claude
Lamoureux, Ontario Teachers' President and CEO. "We have a
fiduciary duty to the active and retired Ontario teachers for
whom we invest to press the companies we invest in to deliver
shareholder value. As this suit illustrates, we are prepared to
act when necessary."
The settlement, which is subject to a number of conditions, is
part of a global settlement between Nortel (and certain of its
current and former directors) and the lead plaintiffs for two
separate securities fraud class actions ("Nortel I" and "Nortel
II") currently pending against the company in the United States
District Court in New York, New York.
In 2004, OTPP and the New Jersey Department of the Treasury were
appointed by a U.S. federal judge to head the prosecution of the
"Nortel II" case, the second of two major cases arising from the
disclosure of significant accounting improprieties at Nortel in
recent years. The "Nortel II" case is being prosecuted on
behalf of persons who purchased Nortel common stock between
April 24, 2003 and April 27, 2004. (The earlier "Nortel I"
class period is October 24, 2000 through February 15, 2001.)
The contingent settlement announced settles the securities fraud
claims being prosecuted against the company and certain of its
directors in "Nortel II", as well as the claims asserted in the
earlier "Nortel I" case.
The total consideration Nortel is paying to the two investor
classes comprises $575 million in cash, plus 14.5% of the
company's current equity (approximately 628 million shares).
Based on the $3.02 closing price of Nortel common stock on
February 7, 2006, the settlement equity would be worth
approximately $1.9 billion.
The settlement was reached after an extensive mediation process
presided over by Senior U.S. District Judge Robert W. Sweet.
The mediation process culminated this week in an intensive two
day session in New York involving the top management of Nortel
and senior representatives from Ontario Teachers' and other
plaintiffs.
The payment by the Company will be allocated equally between the
two investor classes using an allocation formula worked out
between the Nortel I and Nortel II lead plaintiffs with the
active assistance of Judge Sweet.
The settlement in principle has at least three significant
conditions, including governance provisions, insurance issues
and securities regulators' approvals for issuing the 628 million
Nortel settlement shares.
If the conditions to the settlement are satisfied, the
settlement must be approved by the Honourable Loretta A. Preska,
U.S. District Court Judge for the Southern District of New York,
after notice to the Nortel II class.
Ontario Teachers' was represented in the "Nortel II" litigation
and the settlement negotiations by New-York based outside
counsel at Bernstein Litowitz Berger & Grossmann LLP.
For more information contact Deborah Allan, Director,
Communications of Ontario Teachers' Pension Plan, Phone:
(416) 730-5347, E-mail: deborah_allan@otpp.com.
NORTEL NETWORKS: Settles Stock Suit with Canadian Fund Manager
--------------------------------------------------------------
The OPSEU Pension Trust (OPTrust) said it reached conditional
settlement of a major U.S. securities class action against
Nortel Networks.
OPTrust was appointed by U.S. District Judge Richard M. Berman
as sole Lead Plaintiff in this action, which is pending in
Federal Court in the Southern District of New York (In Re Nortel
Networks Corp. Securities Litigation, 01-CIV-1855).
Under the settlement, Nortel will pay financial compensation of
approximately US$2.4 billion (based on current share prices),
consisting of U.S.$575 million in cash and approximately 628
million common shares.
Compensation will be shared equally between the members of the
OPTrust class, which covers the class period October 24, 2000 to
February 15, 2001, and the members of a subsequent class covered
by a second securities class action for the period April 24,
2003 to April 27, 2004 (the Nortel II litigation).
As a major institutional investor in Canada, OPTrust has a
longstanding commitment to shareholder rights and the proper
functioning of the securities markets in which it invests.
"OPTrust has worked hard for many years to bring this case to
its successful conclusion, and, with this conditional
settlement, has secured an historically significant financial
recovery for class members," said Heather Gavin, Chief
Administrative Officer of the OPSEU Pension Trust." It is very
important that institutional owners live up to their obligations
as shareholders, and we believe that the OPSEU Pension Trust has
fulfilled this important responsibility in regard to this
litigation."
The settlement is conditional on, among other things, corporate
governance reforms to be agreed between the plaintiffs and
Nortel, and the negotiation of further settlement payments from
insurance carriers. The settlement is also subject to court
approval and to applicable regulatory approvals.
Senior Judge Robert W. Sweet of the Southern District of New
York successfully mediated the intense discussions leading to
these arrangements. The mediation was initiated following Judge
Sweet's appointment by Judges Berman and Preska, and took
several months of protracted discussions (including an intensive
two day session this week involving the top management of Nortel
and senior representatives from OPTrust and other plaintiffs) to
culminate in the conditional settlement announced. Judge Sweet
will continue to work with the parties to resolve outstanding
issues.
The OPSEU Pension Trust has been represented in this litigation
by David J. Bershad, Steven G. Schulman and Daniel B. Scotti of
Milberg Weiss Bershad & Schulman LLP, and Murray Gold of the
Canadian law firm of Koskie Minsky LLP.
OPTrust manages one of Canada's largest pension funds and
administers the OPSEU Pension Plan, with more than $10 billion
in assets under management.
The case is styled "Weinstein, et. al v. Nortel Networks, et. al
(1:01-cv-01855-RMB-MHD)," filed in the U.S. District Court for
the Southern District of New York under Judge Richard M. Berman,
with referral to Judge Michael H. Dolinger. Representing the
defendant(s) is Richard F. Albert of Morvillo, Abramowitz,
Grand, Iason & Silberberg, P.C., 565 Fifth Avenue, New York, NY
10017, Phone: (212) 856-9600. Representing the plaintiffs are
Steven G. Schulman of Milberg Weiss Bershad & Schulman LLP
(NYC), One Pennsylvania Plaza, New York, NY 10119, Phone: 212-
946-9356; Fax: 212-273-4406; E-mail: sschulman@milbergweiss.com;
and Daniel Bernard Scotti of Milberg Weiss Bershad & Schulman
LLP (NYC), One Pennsylvania Plaza, New York, NY, Phone: 10119
(212) 594-5300; Fax: 212-868-1229; E-mail: dscotti@milberg.com.
NORTH CAROLINA: Efforts to Obtain Secret Recordings Put on Hold
---------------------------------------------------------------
An effort by some officials of Union County, North Carolina, to
get a copy of a secret recording Commissioner Stony Rushing made
of a conversation between himself and the county manager could
be on hold, The Charlotte Observer reports.
Commissioners' Chairman Roger Lane told The Charlotte Observer
that he's going to "take a wait and see approach," and doesn't
plan to discuss the issue during the Union Board of County
Commissioners meeting on Feb. 13, 2006.
Last month, county staff attorney Jeffrey Crook sent an open
records request to Mr. Rushing, asking for a copy of the
recording. Mr. Crook said that it is a public record because it
was made in a county-owned building, county-related issues were
discussed and Mr. Rushing has publicly said he wanted to release
the content to the "media and the public." He also asked Mr.
Rushing to turn over the recording and copies of any transcripts
to the commissioners' clerk "as soon as possible."
County Manager Mike Shalati told The Charlotte Observer that the
county should have a copy so "we can accurately answer any
questions about it." The recording is the basis of criticisms
Mr. Rushing has made of Mr. Shalati and other commissioners.
However, Mr. Rushing told The Charlotte Observer that he's
withholding the information because "it's a legal matter." He
also said that evidence on the tape might be used in a possible
class-action lawsuit against "the three renegade commissioners."
When told that Mr. Rushing declined to turn over the recording,
Mr. Shalati said, "We'll let the board deal with that." He
pointed out to The Charlotte Observer, "He's one of their
colleagues and a member of the board, and the board will do
whatever they deem appropriate."
On Jan. 14, Rushing publicly released part of the 90-minute
audio recording he secretly made of a July conversation he had
with Mr. Shalati. According to him, he did it, because in the
past Mr. Shalati has denied saying some things to Mr. Rushing
"or gave another story." Mr. Shalati though denies the
allegations and said he stands by what he says.
The recording, which Mr. Rushing played during a news
conference, is part of a long-running offensive against three
commissioners and the county manager. Mr. Rushing says the
conversation proves commissioners Lane, Hughie Sexton and
Richard Stone meet illegally before casting votes, and Mr.
Shalati is "pushed" to do their "dirty work."
Those officials though told The Charlotte Observer that it
proved nothing. Mr. Shalati explains that they wanted the
recording "because otherwise everything is one-sided and we have
no clue about what he's talking about."
Mr. Rushing, long at odds with Mr. Shalati and the three
commissioners, told The Charlotte Observer that he released the
recording publicly after the county leaders declined to talk
about the accusations. Mr. Rushing and Commissioner Kevin
Pressley frequently are on the losing end of 3-2 votes on the
all-Republican board.
THREEMILE CANYON: Employees Launch Overtime Wage Lawsuit in Ore.
----------------------------------------------------------------
Four employees in the composting operation at Threemile Canyon
Farms in Boardman, Oregon initiated a class-action lawsuit
against the dairy's owners, alleging that the Company wrongly
classified them as agricultural workers in order to avoid paying
overtime, The Tri-City Herald reports.
The lawsuit was filed in Federal Court in Portland on behalf of
Leonardo Ramirez, Jose Marquez, Roberto Valencia and Andres
Garay. It could be expanded to include 30 or more employees who
worked at the farm since 2003.
Jim McCandlish, attorney for the plaintiffs told The Tri-City
Herald, "What is amazing here is that we've got as much as 105
hours a week that a guy is working driving heavy equipment." He
adds, "(This case) is about the employer following the law and
treating the employees with the respect that the law gives
them."
The employees worked in a division of the farm known as RDO-BOS
Farms, LLC, a North Dakota-based company owned by Threemile
Canyon Farms proprietors Ron D. Offutt and John Bos. RDO-Bos
processes animal waste from the Columbia River Dairy, mixes it
with yard debris from Spokane and sells the compost
commercially.
Farm spokesman Len Bergstein told The Tri-City Herald that he
hadn't seen the lawsuit and was frustrated attorneys provided
copies to the media before the company. He accused the
attorneys of rushing "to have a press release rather than having
a real lawsuit." Mr. Bergstein added that RDO-Bos is a fully
licensed agricultural facility and is recognized as such by
Morrow County as well as the Oregon Department of Environmental
Quality.
As agricultural workers, the Company could allow the employees
to work more than 40 hours per week without paying time and a
half. However, Mr. McCandlish told The Tri-City Herald that the
men were assigned to work in the processing, packaging and
shipping of compost and Oregon law exempts them from being
classified as agricultural workers.
In addition, Ms. McCandlish also told The Tri-City Herald that
he would argue that the Company defaulted its agricultural
designation when it imported material from off-site areas and
developed it for other purposes. He pointed out that the
workers should be classified as manufacturing employees and
deserve to be paid overtime wages for anything more than 40
hours per week. Paycheck stubs showed some employees put in
well more than that on a regular basis, according to the
lawsuit.
Mr. Valencia, who was hired in 2003, worked more than 105 hours
during the week of May 1, 2005, but received only his regular
pay for the additional hours. Mr. Ramirez and Mr. Marquez had
pay stubs showing weeks during which they worked more than 86
hours for regular pay, which was about $8 per hour.
"What I find astounding is that here we have this huge farm that
can't come into compliance with state and federal law and over
and over employees have had to turn to regulatory agencies to
find redress," Erik Nicholson, regional director of the United
Farm Workers of America told The Tri-City Herald.
The suit is styled, "Ramirez et al v. RDO-BOS Farms, LLC, Case
No. 3:06-cv-00174-KI," filed in the U.S. District Court for the
District of Oregon under Judge Garr M. King. Representing the
Plaintiff/s are, Mark E. Griffin and James Edward McCandlish of
Griffin & McCandlish, 215 SW Washington St., Waldo Block, Suite
202, Portland, OR 97204, Phone: (503) 224-2348 and
(503) 224-2349, Fax: (503) 224-3634, E-mail:
mark@markgriffin.com and j@mccandlish.com.
TIME WARNER: Hawaii Pension Funds Join Lawsuit Over AOL Merger
--------------------------------------------------------------
Five retirement funds for Hawaii workers joined approximately
100 other plaintiffs in a shareholder lawsuit against Time
Warner Inc., its management and others associated with the
Company's 2001 merger with America Online (AOL), The Honolulu
Star-Bulletin reports.
The suit alleges that AOL inflated sales to help close the deal,
which created a conglomerate that was to marry the new media
embodied by AOL with the traditional media of Time Warner, the
giant whose assets include such venerable institutions as the
Warner Bros. studio in Hollywood and Time magazine. The suit
asks for $1.6 billion.
The new shareholder complaint comes after more than 100
investors chose to opt out of a $2.4 billion settlement of a
class-action lawsuit against New York-based Time Warner, William
Lerach, whose San Diego-based firm, Lerach Coughlin Stoia Geller
Rudman & Robbins, is lead counsel for the plaintiffs told The
Honolulu Star-Bulletin. He explains, "They feel they want to
maximize whatever recovery they can." Mr. Lerach also said that
all investors lost as much as $300 billion from the merger,
including interest.
Among those joining the plaintiffs are the Hawaii Electricians
Annuity Fund, the Hawaii Electricians Pension Fund, the Hawaii
Laborers Pension Fund, the Hawaii Reinforcing Ironworkers
Pension Trust Fund and the Hawaii Structural Ironworkers Pension
Trust Fund. They are represented locally by Price Okamoto
Himeno & Lum.
Time Warner spokeswoman Susan Duffy told The Honolulu Star-
Bulletin of the new suits, "We will defend against these actions
vigorously." She added that the "overwhelming majority" of Time
Warner shareholders are participating in the settlement and that
the opt-out suits don't threaten it.
TYSON FRESH: Cattle Producers Urge High Court Review of Pickett
---------------------------------------------------------------
The Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of
America or otherwise known as R-CALF USA, along with 36 local,
state and tribal groups that represent independent cattle
producers across the nation jointly filed a friend-of-the-court
brief asking the U.S. Supreme Court to review a recent decision
by the U.S. 11th Circuit Court of Appeals on price manipulation
in the meatpacking industry in the case styled, "Pickett v.
Tyson Fresh Meats, Inc. (TFM, formerly IBP, Inc.)," The
CattleNetwork.com reports.
In the brief, R-CALF USA argues that failure to review the 11th
Circuit's decision could profoundly undermine the Packers and
Stockyards Act of 1921 (PSA), a key component of U.S. law, which
regulates market abuses by the meatpacking industry. R-CALF USA
President Chuck Kiker pointed out, "This case deserves the
Supreme Court's attention. The PSA was enacted to rein in the
worst excesses of a highly concentrated meatpacking industry at
the beginning of the last century."
Mr. Kiker explains, "The industry is again becoming highly
consolidated, and today, meatpackers use increasingly
sophisticated techniques to deny cattle producers an honest
price for their product. Independent cattle producers have been
deeply concerned for many years over the packing industry's
captive-supply practices, and a review of the Pickett case by
the Supreme Court will help clarify whether these practices
violate the current law, as many cattle producers believe."
In July 1996, certain cattle producers filed a class action
styled "Henry Lee Pickett, et al. v. IBP, Inc." in the U.S.
District Court for the Middle District of Alabama, seeking
certification of a class of all cattle producers. The complaint
alleged that TFM "used its market power and alleged captive
supply agreements to reduce the prices paid by TFM on purchases
of cattle in the cash market in alleged violation of the Packers
and Stockyards Act (PSA), (Class Action Reporter, Jan. 4, 2005).
Plaintiffs sought injunctive and declaratory relief, as well as
actual and punitive damages. Plaintiffs submitted an amended
expert report on November 19, 2003, showing alleged damages on
all cash market purchases by TFM of approximately $2.1 billion.
Trial of this matter began on January 12, 2004, and concluded on
February 10, 2004. On February 17, 2004, a jury returned a
verdict against TFM on liability and gave an "advisory" verdict
on damages that estimated the impact on the cash market (i.e., a
group larger than the class) to be $1.28 billion, (Class Action
Reporter, Jan. 4, 2005).
On February 25, 2004, TFM filed a renewed motion requesting the
Court to enter a judgment as a matter of law (JMOL) for TFM. On
March 1, 2004, the plaintiffs filed motions asking the Court to
enter the $1.28 billion advisory verdict as an award of damages
to the plaintiffs and requesting prejudgment interest. On March
22, 2004, the Court denied the plaintiff's motions for entry of
a damages award. On April 23, 2004, the Court granted TFM's
JMOL motion, and held:
(1) TFM had legitimate business reasons for using "captive
supplies,"
(2) there was "no evidence before the Court to suggest that
[TFM's] conduct is illegal," and
(3) "plaintiffs failed to present evidence at trial to
sustain their burden with respect to liability and
damages," (Class Action Reporter, Jan. 4, 2005).
The plaintiffs appealed the Court's entry of judgment in favor
of TFM to the 11th Circuit Court of Appeals with oral arguments
being heard by the Circuit Court starting December 17, 2004.
The 11th Circuit though affirmed the trial-court's earlier
ruling, and the plaintiffs have now filed a petition for
certiorari seeking Supreme Court review.
Leo McDonnell, Co-Founder and Past President of R-CALF USA told
The CattleNetwork.com, "The PSA has been an important law for
the cattle industry for over 80 years. We believe the
plaintiffs in the Pickett case presented a strong claim and we
are hopeful that the Supreme Court will accept this case." He
continued, "Supreme Court clarification of the ongoing viability
of the PSA can help ensure we have a strong and healthy cattle
industry in the United States." He also pointed out, "Just last
month, USDA's own Inspector General reported the agency is
failing to fulfill its duty to enforce the PSA.
Mr. McDonnell even emphasized, "Cattle producers may face
increasing difficulty in enforcing their own rights under the
Act, unless the Pickett decision is accepted for review, and the
bounds of the law are made clear for all."
The suit is styled "Pickett, et al v. Tyson Fresh Meats, et al,
2:96-cv-01103-LES-CSC," filed in the United States District
Court for the Middle District of Alabama under Judge Lyle E.
Strom, presiding. Representing the Plaintiff/s are:
(i) Andrew Clay Allen, Joe R. Whatley, Peter Harrington
Burke, Whatley Drake, LLC, PO Box 10647, Birmingham, AL
35202-0647, Phone: 205-328-9576, Fax: 328-9669, Email:
aallen@whatleydrake.com, jwhatley@whatleydrake.com or
measterwood@whatleydrake.com
(ii) David Alan Domina, Norah M. Kane, Domina Law PC, 1065
North 115th Street, Suite 150, Omaha, NE 68154, Phone:
402-493-4100, Fax: 402-493-9782, E-mail:
dad@dominalaw.com or nmk@dominalaw.com
(iii) Ernest Clayton Hornsby, Jr., Morris Haynes & Hornsby
The Financial Center, 505 North 20th Street, Suite
1150, Birmingham, AL 35203, Phone: 205-324-4008, Fax:
205-324-0803, Email: chornsby@bellsouth.net
(iv) Larry Wade Morris, Morris, Haynes & Hornsby, PO Box
1660, Alexander City, AL 35011-1660, Phone: 256-329-
2000, Fax: 329-2015, Email: paralegal888@yahoo.com
(v) Pierce Jackson Harris, Jr., Randy Beard, Beard & Beard
PO Box 88, Guntersville, AL 35976-0088, Phone: 256-582-
3189, Fax: 256-582-6787, Email: pj@beardandbeard.com or
randy@beardandbeard.com
(vi) Stephen K. Griffith, Knight Griffith McKenzie Knight
McLeroy & Little LLP, PO Box 930, Cullman, AL 35056,
Phone: 256-734-0456, Fax: 256-734-0466 or Email:
skgriff@knight-griffith.com.
Representing the Defendant/s are, Sidley Austin Brown & Wood,
1501 K Street, NW, Washington, DC 20005, Phone: 202-736-8000,
Fax: 202-736-8711, E-mail: fvolpe@sidley.com and Nathan Hodne,
Tyson Foods, Inc., Asst. General Counsel, 2210 West Oaklawn
Drive Springdale, AR 72762, Phone: 479-290-4706, Fax:
479-290-7967, E-mail: Nathan.Hodne@Tyson.com.
UBS AG: Reaches $89M Settlement on Salary, Hours Litigations
------------------------------------------------------------
UBS AG reached agreement in principle to settle class-action
wage and hour claims filed in several federal courts on behalf
of Financial Advisors and Financial Advisor trainees.
The settlement resolves claims that UBS incorrectly classified
Financial Advisors and Financial Advisor trainees as exempt
under federal law and the laws of all the states where UBS
employs such employees. It also resolves claims that UBS should
not have made certain adjustments to the compensation of
Financial Advisors and Financial Advisor trainees.
As part of the settlement, the firm has agreed to pay as much as
$89 million. The vast majority of this amount was provisioned
in third quarter 2005.
UBS settled this case at the national and state level because it
did not believe protracted litigation in multiple courts was in
the best interests of employees or clients.
Approximately three-quarters of the settlement will be available
to employees via a claims process that must be approved by the
court. Final details of the payment process are still to be
determined by the court and will be managed by a third-party
administrator. The remaining quarter of the settlement amount
will go to administrative and legal costs.
Asset manager, UBS AG -- http://www.ubs.com--headquartered in
Zurich and Basel, is present in all major financial centers
worldwide. It has offices in 50 countries, with 38% of its
employees working in the Americas, 38% in Switzerland, 16% in
Europe and 8% in the Asia Pacific time zone. UBS's financial
businesses employ over 70,000 people worldwide.
UNITED STATES: ACLU Fights for Students Right to Financial Help
---------------------------------------------------------------
The American Civil Liberties Union is considering filing a
lawsuit to uphold the rights of students denied federal
financial aid for past drug convictions, according to USA Today.
ACLU Drug Law Reform Project is preparing to file a nationwide
class-action lawsuit against officials "who have ultimately
denied student aid" to students with drug offenses, staff
attorney Adam Wolf said, according to the report. Mr. Wolf said
lawyers have met with hundreds of students.
The statement comes just as Congress passed a bill pushing for
the eligibility of some college students or would-be students to
avail of financial aid previously denied from them. The bill is
seeking to tone down a 1998 law denying federal financial aid to
applicants who indicated they had been convicted of a drug
offense. It will still, however, limit access to federal aid of
students convicted of a drug felony or misdemeanor in college,
to at least one year.
According to the report, Department of Education data shows the
reform coalition and other groups estimate about 175,000
applications have been disqualified since the government began
asking about drug convictions on financial aid forms in 2000.
This doesn't include students who didn't apply on assumption
they would be denied.
The law was the work of Rep. Mark Souder, R-Ind., who believes
it would deter students' drug involvement, and encourage abusers
to get treatment. He, too, is now supporting the bill that
would introduce revisions to the law.
American Civil Liberties Union on the Net: http://www.aclu.org/.
WASHINGTON: City Files Suit V. Web Sites over Lost Hotel Taxes
--------------------------------------------------------------
The city of Bellingham, Washington launched a federal lawsuit
against a host of Web sites offering reduced rate hotel rooms,
hoping to collect money lost to every city and county in the
state, The Bellingham Herald reports.
However, Washington State Department of Revenue officials say
the city will withdraw the suit at its request over concerns the
issue should be resolved administratively, not through the
courts.
The suit was filed in the U.S. District Court in Seattle and is
seeking class-action status. It names as defendants Web sites
such as Hotels.com, Priceline.com, Travelocity.com and
Orbitz.com.
Court documents filed on behalf of the city outlines how the Web
sites offer customers hotel rooms at cheap prices by buying
rooms in bulk. The suit contends the companies pay lodging
taxes at the bulk rate rather than the high retail rate their
customers pay, cheating cities and counties out of money through
an "illicit tax evasion scheme."
The lawsuit mirrors similar cases across the country as other
counties and cities try to collect lodging taxes from online
brokers. If granted class-action status by the court, 176
cities and counties across the state collecting the lodging tax
could join as parties to the lawsuit.
It remains unclear though if the city's lawsuit will be moving
forward. The city may drop its lawsuit in the next few weeks,
Mike Gowrylow, a spokesman for the state Department of Revenue
told The Bellingham Herald. He explains that state officials
only learned of the city's lawsuit after it was filed in federal
court.
Hotel/motel taxes are collected by the state treasurer and later
doled out to counties and cities. In Bellingham, the city
levies a 4 percent hotel/motel tax, finance director Therese
Holm told The Bellingham Herald. In 2005, the city collected
$818,490 in lodging taxes.
The suit is styled "Bellingham City of v. Hotels.com LP et al.,
Case No. 2:05-cv-01822-RSL," filed in the United States District
Court for the Western District of Washington under Judge Robert
S. Lasnik. Representing the plaintiffs are:
(1) Karl Phillip Barth and Benjamin Schwartzman, LOVELL
STEWART HALEBIAN & BARTH, 1420 FIFTH AVE, STE 2200,
SEATTLE, WA 98116, Phone: 425-452-9800, E-mail:
kbarth@lmbllp.com, ben@lmbllp.com
(2) Dean Ralph Brett, BRETT & DAUGERT, PO BOX 5008,
BELLINGHAM, WA 98227-5008, Phone: 360-733-0212, Fax:
360-647-1902, E-mail: dbrett@brettlaw.com
(3) William M Sweetnam, FREED & WEISS, 111 W WASHINGTON
ST., STE 1331, CHICAGO, IL 60602, US, Phone: 312-220-
0000, E-mail: bills@freedweiss.com
(4) Dean Ralph Brett of BRETT & DAUGERT, P.O. BOX 5008,
BELLINGHAM, WA 98227-5008, Phone: 360-733-0212, Fax:
360-647-1902, E-mail: dbrett@brettlaw.com
(5) Ingrid L. Moll and William H. Narwold of MOTLEY RICE
(CT), 20 CHURCH ST., 17TH FLOOR, HARTFORD, CT 06103,
US, Phone: 860-882-1678 and 860-882-1676, E-mail:
imoll@motleyrice.com and bnarwold@motleyrice.com
Representing the Defendant/s are:
(i) Michael A. Barlow, Karen L. Valihura and Darrel J.
Hieber of SKADDEN ARPS SLATE MEAGHER & FLOM (DE),
Phone: 302-651-3000 and 213-687-5000, E-mail:
MBARLOW@SKADDEN.COM, KVALIHUR@SKADDEN.COM and
DHIEBER@SKADDEN.COM
(ii) Randall Paul Beighle of LANE POWELL PC (SEA), 1420
FIFTH AVE., STE. 4100, SEATTLE, WA 98101-2338, Phone:
206-223-7000, E-mail: beighler@lanepowell.com
(iii) Thomas L. Boeder and Cori Gordon Moore of PERKINS COIE
(SEA), 1201 3RD AVE., STE. 4800, SEATTLE, WA 98101-3099
Phone: 206-583-8888, Fax: 583-8500, E-mail:
tboeder@perkinscoie.com and cgmoore@perkinscoie.com
(iv) Portia R. Moore of MORRISON & FOERSTER (SF), 425 MARKET
ST., SAN FRANCISCO, CA 94105-2482, Phone: 415-268-7450,
Fax: 415-268-7522, E-mail: pmoore@mofo.com
(v) John D. Pernick of BINGHAM MCCUTCHEN, 3 EMBARCADERO
CTR., SAN FRANCISCO, CA 94111-4067, Phone: 415-393-
2000, E-mail: john.pernick@bingham.com
(vi) Jeremy E Roller of YARMUTH WILSDON CALFO, 925 FOURTH
AVE., STE. 2500, SEATTLE, WA 98104, Phone: 206-516-
3800, Fax: 206-516-3888, E-mail: jroller@yarmuth.com
(vii) Stephen M. Rummage of DAVIS WRIGHT TREMAINE, LLP, 1501
4TH AVE., STE. 2600, SEATTLE, WA 98101-1688, Phone:
206-628-7755, Fax: 628-7699, E-mail:
steverummage@dwt.com
Asbestos Alert
ASBESTOS LITIGATION: Unitrin Notes US$19M A&E Reserves for 2005
---------------------------------------------------------------
Unitrin Inc. reports total asbestos and environmental reserves
in its Business Insurance segment at about US$19 million and
US$20 million at December 31, 2005 and 2004, respectively,
according to a SEC report.
The Company's commercial lines business is focused on the small
commercial market and does not usually write policies insuring
large manufacturers. Its exposure to asbestos and environmental
losses is limited.
The Company does have some exposure to asbestos claims and
construction defect. The estimation of loss reserves relating to
asbestos and construction defect are subject to greater
uncertainty than other types of claims due to differing court
decisions as well as judicial interpretations and legislative
actions that in some cases have tended to broaden coverage
beyond the original intent of such policies.
COMPANY PROFILE
Unitrin, Inc.
1 E. Wacker Dr.
Chicago, IL 60601
Phone: 312-661-4600
Fax: 312-494-6995
http://www.unitrin.com
Description:
Unitrin Inc.'s units provide property & casualty, life and
health, direct insurance, and consumer finance. The Company
operates in the southern, midwestern, and western parts of the
US, primarily in California and Texas.
ASBESTOS LITIGATION: Owens-Illinois Pending Claims Drop to 32T
--------------------------------------------------------------
Owens-Illinois Inc. states that the number of pending asbestos-
related lawsuits and claims is about 32,000 as of December 31,
2005, according to a Securities and Exchange Commission report.
As of September 30, 2005, the Company had about 33,000 asbestos-
related lawsuits and claims compared with about 35,000 at
December 31, 2004 (Class Action Reporter, October 21, 2005).
The Company believes that a significant number of these cases
have exposure dates after the Company's 1958 exit from the
business.
Asbestos-related cash payments in the 2005-4th quarter were
US$35.9 million compared with US$39.8 million in the 2004-4th
quarter, a reduction of US$3.9 million, or 9.8%. New filings
during the quarter were 56% lower than the prior year quarter.
Deferred amounts payable totaled about US$91 million at December
31, 2005, virtually unchanged from the amount at December 31,
2004. Asbestos cash payments for the full year 2005 were
US$171.1 million compared with US$190.1 million for the full
year 2004, representing a reduction of US$19.0 million or 10.0%.
The Company recorded a non-cash charge of US$135.0 million to
increase the accrual for future asbestos-related costs. In 2004,
the Company increased its accrual for future asbestos-related
costs by US$152.6 million. As of December 31, 2005, the
Company's accrual for future asbestos-related costs is US$730.1
million of which US$158.0 million is classified as a current
liability.
Toledo, OH-based Owens-Illinois Inc. makes glass containers (for
beer, soft drinks, liquor, wine, and other beverages), which
accounts for almost 90% of sales. The Company also makes plastic
healthcare packaging, including prescription bottles, tamper-
proof closures, and plastic medical devices. The Company markets
in the Americas, Europe, and the Asia/Pacific region.
ASBESTOS LITIGATION: Crown Holdings Payments Reach $29M in 2005
---------------------------------------------------------------
Crown Holdings Inc. reports that it paid a total of US$29
million for asbestos-related matters in 2005, according to a
Company release.
The payments included US$13 million under existing settlement
agreements, compared to US$41 million payments, which included
US$22 million under existing settlement agreements, in 2004.
In the 2005-4th quarter, the Company recorded a US$10 million
charge (net of tax or US$0.06 per diluted share) to increase its
asbestos litigation reserve.
The Company estimates that its liability for pending and future
asbestos claims will range from US$214 million to US$272
million. At December 31, 2004, the Company reported a range of
US$233 million to US$351 million.
After the US$10 million charge, the Company's recorded liability
at December 31, 2005, was US$214 million compared to US$233
million at December 31, 2004.
Formerly known as Crown Cork & Seal Co., Philadelphia, PA-based
Crown Holdings Inc. makes consumer packaging. Its product
portfolio consists of aerosol cans, food and beverage cans,
paint cans, plastic bottles and other containers, and metal
caps, crowns, and closures.
ASBESTOS LITIGATION: St Paul Travelers Notes $830M Reserve Boost
----------------------------------------------------------------
In accordance with its annual asbestos review, the St. Paul
Travelers Companies Inc. reports increased asbestos reserves by
US$830 million in the 2005-4th quarter resulting in a US$548
million after-tax charge, according to a Company release.
In the 2004-4th quarter, the Company increased asbestos reserves
by US$922 million, resulting in a US$613 million after-tax
charge.
The 2005-4th quarter included after-tax charges of US$566
million (US$860 million pre-tax) for asbestos and environmental
reserve development and US$435 million (US$623 million pre-tax)
for catastrophe losses.
The 2004-4th quarter included after-tax charges of US$673
million (US$1.006 billion pre-tax) for asbestos and
environmental reserve development and US$80 million (US$116
million pre-tax) for catastrophe losses.
Based in St. Paul, Minnesota, the St. Paul Travelers Companies
Inc. offers personal and commercial liability and casualty,
property, workers' compensation, auto, marine, and other
coverage to companies in North America and the UK.
ASBESTOS LITIGATION: PA Judge Prohibits Use of Clean Air Fund
-------------------------------------------------------------
Common Pleas Judge Judith L.A. Friedman halts a plan to utilize
US$1.3 million from the Allegheny County's US$7.5 million Clean
Air Fund to remove asbestos from a redevelopment site in
Duquesne, the Pittsburgh Tribune-Review reports.
Judge Friedman extended an emergency injunction that she granted
to the Group Against Smog & Pollution, a Squirrel Hill-based
organization.
GASP sued the County and its health department, alleging that it
is illegal to use money to aid the Regional Industrial
Development Corporation in demolishing 15 crumbling, asbestos-
laden blast furnaces on a former U.S. Steel site at Duquesne
City Center.
Lawyers for the County have 20 days to file written arguments.
Judge Friedman noted in a memorandum to lawyers that use of the
Clean Air Fund "is clearly not aimed at actual abatement of
pollution problems, but rather at monitoring and educating."
"It appears that the judge is coming down on our side of this
issue," said GASP spokeswoman Elizabeth Rosemeyer, who said
money for the asbestos removal could come from other state
funds.
ASBESTOS LITIGATION: Japan to Accept Aid Applications by March
--------------------------------------------------------------
The Japanese Government plans to start accepting applications
for financial assistance in March following the implementation
of the new asbestos relief law.
The law, which seeks to provide financial support to people
suffering from asbestos-related diseases, had recently cleared
the House of Councilors. The law also aims to aid those who have
lost family members to such illnesses.
Under the law, the Government will cover out-of-pocket medical
expenses and recuperation fees for people suffering from
asbestos-linked diseases, including mesothelioma, and will
provide funeral fees when they die. The Government will pay
condolence money and funeral fees to the families of the victims
of such illnesses who died before the law's implementation and
who were not covered by the current industrial accident
insurance schemes.
Revisions to four laws ensuring the swift elimination and
tighter control of asbestos were also approved.
ASBESTOS LITIGATION: Coroner Links Engineer's Death to Asbestos
----------------------------------------------------------------
Coroner Roger Whittaker ruled that exposure to asbestos killed a
40-year-old water engineer, the Telegraph & Argus reports. Mr.
Whittaker recorded a verdict of death by industrial disease.
Jonathan Kay died of mesothelioma, a rare and incurable form of
cancer, last August 2005 knowing he had won a compensation
battle against Kelda Group plc, the parent company of Mr. Kay's
former employer Yorkshire Water.
Mr. Kay sued Kelda for GBP300,000 for allegedly exposing him to
the deadly material asbestos (Class Action Reporter, May 20,
2005).
Mr. Kay had fought mesothelioma for one-and-a-half years
following his work for Yorkshire Water in the late 1980s. He had
worked at the firm's Eccup Water Treatment Works near Adel,
Leeds, and its pumping stations in North Lane, Headingley and at
Brayton Barff Works near Selby.
Mr. Whittaker said he understood that the normal time span
between asbestos exposure to mesothelioma development is 30 to
40 years.
Pathologist John O'Hara said a post-mortem examination indicated
Mr. Kay died from a lung infection caused by malignant
mesothelioma.
ASBESTOS LITIGATION: Union Deems Omni-Pac Settlement Inadequate
----------------------------------------------------------------
The Transport and General Workers Union considers inadequate the
GBP136,000 total fines and costs bill imposed on egg box company
Omni-Pac (UK) Ltd, according to a Trades Union Congress report.
The Norwich Crown Court issued a GBP50,000 fine to Omni-Pac,
GBP25,000 for each of two charges, after the Company pleaded
guilty to violating health and safety laws, by exposing workers
to asbestos. The Court also ordered the Company to pay
prosecution costs amounting to GBP86,000 (Class Action Reporter,
February 3, 2006).
In a statement after Omni-Pac's sentencing, TGWU added that many
former workers might still pay the price through future ill
health. The union said it had campaigned hard to ensure the
Company was held accountable.
TGWU regional industrial organizer Ivan Crane said the health
effects of asbestos exposure may not become apparent for some
years, adding former workers "are, in essence, sitting on a
potential time bomb and are facing an uncertain future, both for
themselves and their families."
The Court heard that, in 1993, senior plant engineer Michael
James had raised concerns about the Company's asbestos risk.
American owned Omni-Pac finally closed the Great Yarmouth
factory in March 2004, although it had been non-operational from
October 2003 following the asbestos revelations.
ASBESTOS LITIGATION: Torts Group Issues Litigation Trends Study
---------------------------------------------------------------
The American Academy of Actuaries' Mass Torts Subcommittee
released a report, "Current Issues in Asbestos Litigation,"
which studies recent trends in asbestos litigation. The report
has a brief litigation overview and stresses recent changes in
the litigation environment.
The report states that at least half a million more claims could
be filed over the next several decades. Despite the huge costs,
the asbestos litigation system has been inefficient, with only
41% of total spending reaching claimants.
While Congress has been debating the issue during the past few
years, several state and local jurisdictions have started their
own reforms.
Projections of future asbestos costs are uncertain because
historical data is incomplete, the litigation environment is
changing, and asbestos diseases will emerge over the next
several decades.
"Stricter medical criteria, combined with heightened scrutiny of
potentially fraudulent claims, might lead to fewer mass
settlements of pending claim inventories and will likely affect
whether and how mass screening activities are conducted in the
future," said Jenni Biggs, Chairperson of the subcommittee.
The Washington, DC-based Academy conducts a public policy
program at the state, federal, and international levels,
bringing actuarial expertise to tackle issues such as Social
Security, Medicare, insurance regulation, and pension reform.
Copies of the report can be found at http://www.actuary.org/.
ASBESTOS LITIGATION: Todd Shipyards Facing 593 Injury Claims
------------------------------------------------------------
Todd Shipyards Corporation defends itself against about 593
personal injury claims, of which 24 cases are "malignant" and
569 are "non-malignant," according to the Company's 10-K report
for fiscal 2005.
Plaintiffs claim damages from exposure to toxic substances,
generally asbestos, at closed former Company facilities. In
addition to the Company, defendants in these cases are other
ship builders and repairers, ship owners, asbestos
manufacturers, distributors and installers, and equipment
manufacturers.
Based on current patterns, certain diseases including
mesothelioma, lung cancer and fully developed asbestosis are
categorized by the Company as "malignant" claims. Others of a
less serious nature are categorized as "non-malignant."
The Company recorded about 597 claims, of which 26 are
"malignant" and 571 are "non-malignant," (Class Action Reporter,
November 11, 2005).
As of January 1, 2006 the Company has recorded a bodily injury
liability reserve of US$7.1 million and a bodily injury
insurance receivable of US$5.2 million. At April 3, 2005, the
Company had a bodily injury reserve and insurance receivable of
US$7.3 million and US$5.3 million, respectively.
Seattle, WA-based Todd Shipyards Corporation repairs, maintains,
overhauls, and builds government-owned and commercial vessels
through subsidiary Todd Pacific Shipyards. The US Government
accounts for more than 90% of the Company's sales.
ASBESTOS LITIGATION: Altria Tackles Remaining Lawsuit in Calif.
---------------------------------------------------------------
Altria Group Inc. reports one cigarette smoking-related asbestos
claim, which is pending in a California Court, according to a
Securities and Exchange Commission report.
These cases seek contribution or reimbursement for amounts
expended related to the defense and payment of asbestos claims
that were allegedly caused in whole or in part by cigarette
smoking.
These cases were filed on behalf of former asbestos producers
and affiliated entities against subsidiary Philip Morris USA and
other cigarette makers.
New York, NY-based Altria Group Inc., formerly Philip Morris
Companies, is a tobacco firm that operates through subsidiaries
Philip Morris USA and Philip Morris International. The Company
controls about half of the US tobacco market.
ASBESTOS LITIGATION: Hercules Tags 4Q Loss to Asbestos Liability
----------------------------------------------------------------
Hercules Inc. posted a 2005-4th quarter loss due to asbestos
liability and charges related to the sale of its stake in a
unit, Reuters reports.
The Wilmington, DE-based Company posted a loss of US$67.9
million, or US$0.62 a share, in the quarter, compared with a
profit of US$49 million, or US$0.45 a share, in the 2004-4th
quarter.
The Company stated net income from ongoing operations was
US$0.17 per share. The average earnings forecast of analysts
polled by Reuters Estimates was US$0.16 cents a share.
Hercules Inc.'s pulp and paper division supplies water-treatment
chemicals and services to the pulp and paper industry, and its
Aqualon subsidiary makes thickeners for water-based products.
The Company's FiberVisions unit makes staple fibers used in
disposable diapers and automotive textiles, and its Pinova unit
makes resins and terpene specialties.
ASBESTOS LITIGATION: Congoleum Files New Plan of Reorganization
---------------------------------------------------------------
Congoleum Corporation files a modified Plan of Reorganization
and disclosure statement with the New Jersey Bankruptcy Court,
the Business Wire reports.
The modified Plan revises the proposed arrangements under which
different groups of asbestos claimants would share in the
insurance proceeds and other assets of the trust to be formed to
pay asbestos claims against Congoleum and the procedures the
trust would follow for payment of claims.
The modified Plan stipulates that Congoleum would make a
contribution to the plan trust consisting of 3.8 million new
Class A Common shares, a convertible security whose value would
be based on the share price of reorganized Congoleum, and a cash
contribution equal to US$7.3 million plus 50% of the interest
accrued on Congoleum's 8 5/8% Senior Notes during Congoleum's
bankruptcy.
The trust would also be funded by proceeds from Congoleum's
insurance policies. To date, insurance settlements amount to
about US$164 million.
The modified Plan also provides that interest accrued on
Congoleum's 8 5/8% Senior Notes during the period it is in
Chapter 11 would be forgiven, and the maturity date of the Notes
would be extended by three years to August 1, 2011.
Board Chairman Roger S. Marcus commented, "We believe filing our
proposed plan is a positive step toward emergence. We have
addressed the issues that posed potential obstacles for our
previous plans. I feel this plan is fair and will provide
greater value to all creditors than any alternative available.
While negotiations with the creditors are still underway, I am
hopeful they ultimately will be satisfied with the terms of this
plan and vote to support it. We can then move ahead with
confirmation of a plan and putting this process behind us."
On December 31, 2003, Congoleum voluntarily filed for Chapter 11
bankruptcy in New Jersey as a means to resolve claims asserted
against it related to the use of asbestos in its products
decades ago.
Mercerville, NJ-based Congoleum Corporation manufactures
resilient flooring, serving both residential and commercial
markets. American Biltrite Inc. own 55% of the Company.
ASBESTOS LITIGATION: Grace Shares Drop Before $140B Fund Debate
---------------------------------------------------------------
W.R. Grace & Co.'s shares dropped to more than 11%, ahead of a
Senate debate on a bill that would put up a US$140 billion fund
to compensate people sickened by asbestos exposure, the
Associated Press reports.
Grace's stock fell US$1.48 to US$11.29 in midday trading on the
New York Stock Exchange, at more than double its average daily
volume.
Under the proposed US$140 billion fund legislation, defendant
companies and their insurers would contribute to a trust fund to
benefit asbestos victims; all asbestos-related court cases would
be stopped, sparing defendants from paying crippling jury
awards.
In 2001, Grace declared bankruptcy after its asbestos injury
claims surged.
In February 2005, a federal grand jury indicted the Company and
a number of its executives, saying the Company knew that
vermiculite from its mine in Libby, MT, contained harmful
tremolite asbestos that is blamed for deaths and sickness in
area residents and former mine workers.
Columbia, MD-based W.R. Grace & Co. operates through two major
units. Its Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: Bankrupt Firms Not Banking on Payout Bill
--------------------------------------------------------------
Major companies forced into bankruptcy by asbestos lawsuits are
not banking on the proposed US$140 billion fund legislation that
would take billion-dollar liabilities off their hands, the Dow
Jones reports.
After five years in bankruptcy, Owens Corning dismissed the idea
of writing the passage of a national asbestos trust into its
Chapter 11 Plan of Reorganization. Armstrong World Industries
Inc. set a May 23 date to begin its reorganization plan's
confirmation hearings.
Federal-Mogul Corporation, ABB Ltd.'s U.S. unit and Kaiser
Aluminum Corporation are other firms that have chosen not to
count on a Congress rescue.
Bankruptcy lawyers also say that continued legislative debate is
getting in the way of companies trying to get out of Chapter 11.
Lawyers say that in some cases, creditors and shareholders have
pressured Chapter 11 companies to stay away from the negotiating
table and to sit tight and wait for Congress to act instead.
Even so, lawyers say many companies have decided to handle their
own asbestos liabilities than participating in the national
asbestos trust.
Federal-Mogul's creditors lobbied against the asbestos bill,
saying it would do more harm than good to the Company's
restructuring effort.
"Over the last couple of years, the continued pendency of this
legislation has had a very confusing and negative effect on the
ability to get cases through Chapter 11 and negotiate deals,"
said W.R. Grace & Co. bankruptcy lawyer and legislation
supporter David Bernick.
ASBESTOS LITIGATION: Owens Corning Exclusivity Extended to July
---------------------------------------------------------------
Judge Judith Fitzgerald of the Delaware Bankruptcy Court
extended the exclusivity period of Owens Corning and its other
Debtors to July 31, 2006.
Norman L. Pernick, of Saul Ewing LLP, argued before the Court at
the hearing on January 30, 2006, that there's plenty of reason
to extend the Debtors' exclusive periods to file and solicit
acceptances of a plan of reorganization. Mr. Pernick said the
objections to the Extension Motion should be overruled.
"I think it's easy for the Court to see that we have a
confirmable plan that's on the table. We treat similarly
situated creditors alike," he said.
Mr. Pernick also pointed out that the Objecting parties'
arguments were inconsistent. He maintained that the plan the
objectors prepared is not confirmable.
"It's not even close if you look at the terms of it," Mr.
Pernick told Judge Judith Fitzgerald. "They're asking asbestos
[claimants] to accept a recovery that asbestos, I think, is
going to tell you they're not interested in doing," he said.
According to Mr. Pernick, the Bondholder Committee's plan
basically is to litigate for another two or three years.
"Then once that litigation's resolved, and assuming that nobody
else can be creative and think of more litigation, maybe we'll
move forward then.
"We've done enough litigation."
Lewis Kruger, of Stroock, Stroock & Levine, counsel for certain
bondholders, clarified that it was not the bondholders'
intention to delay the process "but rather to make the process
one that would be more amenable to a consensual plan."
"We believe that we could indeed file one if the Court
terminated exclusivity," Mr. Kruger told the Court. "We believe
we could file a plan very promptly that would be acceptable to
both the banks and to the asbestos claimants and the Futures
Representative as well, and that we could do it on the same time
table that now exists with the April 5th hearing on the
disclosure document and the prospect of a summertime
confirmation of a plan," he said.
Anthony Gray, of Brown Rudnick Berlack Israels, on behalf of an
ad hoc committee of preferred and equity security holders,
argued that the Debtors have met their burden under Section 1121
of the Bankruptcy Code to show cause that granting an extension
for the exclusivity period for six months is warranted. Mr. Gray
complained that the Debtors are not including the equity and
preferred security holders in the plan process.
Mr. Gray represents 11 institutions that hold in the aggregate
19.5% of the Owens Corning common stock and 54.2% of the shares
of the outstanding preferred securities.
Judge Fitzgerald, however, reminded Mr. Gray that the Debtors
cannot go out to every constituent in the case and invite them
to participate in a case.
"This is an unofficial committee," the Court said.
"I see no basis on which to terminate the Debtor's exclusivity
under these circumstances," Judge Fitzgerald explained on
Debtors' exclusivity extension.
"The Debtor does have a plan on the table. I don't know whether
it will be confirmed, but at least facially, it looks as though
it is confirmable."
The Court noted that the bondholders' plan is dependent on the
passage of the FAIR Act, "which is nothing but a wish and a
prayer.
"Passage of the FAIR Act, if it happens, nobody knows what it's
going to be like," according to Judge Fitzgerald.
Judge Fitzgerald also believes that equity holders are out of
the money.
"I have no evidence in this case that there is going to be a
return unless some secured creditor somewhere decides that it
wants to give some of its money to equity that equity's going to
get any funds," she said.
(Owens Corning Bankruptcy News, Issue No. 125; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
ASBESTOS LITIGATION: Century to Determine Stay Inapplicability
----------------------------------------------------------------
On June 19, 1985, Owens Corning and Century Indemnity Company
became parties to an agreement between a number of insurers and
a number of producers of asbestos-containing products to settle
disputes over liability insurance coverage for asbestos-related
claims against the Subscribing Producers.
The agreement is commonly referred to as the Wellington
Agreement because it was negotiated with the assistance of Harry
Wellington, who was Dean of the Yale Law School at the time.
The Wellington Agreement provides for reciprocal and continuing
rights and obligations of the Subscribing Insurers and the
Subscribing Producers with respect to the handling and funding
of liabilities arising out of asbestos-related personal injury
litigation.
Among others, the Wellington Agreement contains comprehensive,
confidential and mandatory Alternative Dispute Resolution
Procedures that require parties to resolve through alternative
dispute resolution any disputed issues within the scope of the
Agreement.
James S. Yoder, of White & Williams LLP, relates that between
March 1989 and October 1994, Century paid Owens Corning and its
affiliates $30,000,000 with respect to asbestos claims under an
excess general liability insurance policy issued to the Debtors
by Century's predecessor, Insurance Company of North America.
As a result, Century believes that the limits of the Policy have
been exhausted or overpaid. The combined single limit of the
Policy is $10,000,000 per occurrence, Mr. Yoder says.
Despite the Overpayment, Owens Corning sought additional
insurance coverage from Century under the Wellington Agreement
with respect to the same Insurance Policy. Century disputes that
any additional insurance coverage is available to the Debtor.
Pursuant to the ADR Procedures, the parties attempted to resolve
their issues. In 2000, prior to the Petition Date, Owens Corning
initiated the negotiation phase of the ADR Procedures under the
Wellington Agreement. In 2002, after the Petition Date, Owens
Corning notified Century that it was initiating arbitration
under the arbitration trial phase of the ADR Procedures.
As previously reported, Century asked the Court compel Owens
Corning to assume the Wellington Agreement as an executory
contract as a condition of proceeding with the Wellington
Arbitration. Although Owens Corning refused to assume the
Wellington Agreement as an executory contract, Owens Corning
agreed to be bound by any award entered in the Arbitration
pursuant to a Court-approved stipulation between the parties.
Century has not filed a counterclaim and has not yet sought
affirmative relief in the Wellington Arbitration, Mr. Yoder
states. Accordingly, Century did not seek relief from the
automatic stay. The parties neither addressed the automatic stay
issue in the Stipulation.
Century has raised in the Wellington Arbitration a number of
defenses to the Debtors' assertion of coverage for asbestos-
related personal injury claims. Century also reserved its rights
to assert a claim for recoupment of the Overpayment.
The Wellington Agreement provides that the losing party will pay
the costs of the Arbitration proceedings.
Mr. Yonder notes that on January 19, 2006, the Court of Appeals
for the Third Circuit held in ACandS, Inc. v. Travelers Casualty
and Surety Company, that an arbitration proceeding arising out
of an insurance coverage dispute similar to the dispute between
the Debtors and Century is stayed by Section 362 of the
Bankruptcy Code.
Before January 19, 2006, Century believed that it could assert
all coverage defenses and its right of recoupment under the
Wellington Agreement without first obtaining relief from the
automatic stay. Mr. Yonder explains the belief was based on the
Stipulation and on various judicial decisions interpreting the
scope of the automatic stay, like in Charter Crude Oil Company
v. Enron Oil Trading and Transportation Company, fka P & O
Falco, Inc., where the creditor could assert affirmative defense
of setoff in action brought by the debtor without obtaining
relief from bankruptcy stay.
Century asserts that the Third Circuit ruling in ACandS creates
uncertainty and potential prejudice to it if it proceeds with
the Wellington Arbitration without clarification that any award
entered in the arbitration will not be void.
Mr. Yonder argues that it would be inequitable and contrary to
the Bankruptcy Code:
-- For Owens Corning to obtain the benefits of the Wellington
Agreement and the ADR Procedures while retaining the option of
seeking to vacate any award based on a subsequent assertion that
the arbitration violated the automatic stay; and
-- To force Century and the trial judge to proceed with the
Wellington Arbitration and possibly risk sanctions for violation
of the stay.
Proceeding to arbitration without a determination that the
proceedings do not violate the automatic stay will also result
in the expenditure of vast amounts of litigation costs by both
Century and the Debtors' estate without any assurance that the
Wellington Arbitration will finally resolve the dispute over the
extent of insurance coverage available under the Policy, Mr.
Yonder adds.
Century also believes that it will be unfairly prejudiced if it
is forced to participate in the Wellington Arbitration without
the ability to assert any defenses and counterclaims under the
Policy and the Wellington Agreement.
Against this backdrop, Century asks Judge Fitzgerald to find
that the automatic stay is not applicable to the Wellington
Arbitration or any coverage defenses or claim for recoupment
raised by Century under the Wellington Agreement.
If the Court determines that the automatic stay is applicable,
Century alternatively asks the Court to annul the automatic stay
retroactive to the Petition Date:
-- To allow the Wellington Arbitration to proceed; and
-- So Century may assert any other claims available to it under
the Wellington Agreement including its right to recover costs of
the proceedings in the event it is the prevailing party in the
Wellington Arbitration.
Century seeks the Court's permission to file under seal some
exhibits related to its request. The exhibits are subject to the
confidentiality agreement among the parties to the Wellington
Agreement.
(Owens Corning Bankruptcy News, Issue No. 125; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
ASBESTOS LITIGATION: Asarco Seeks Exclusivity Period Extension
--------------------------------------------------------------
Because the debtor subsidiaries of ASARCO LLC did not file for
bankruptcy on the same date, the Court has set the deadlines for
the exclusive period for filing a plan and for obtaining
acceptances for the plan for the different groups of Debtors at
different dates.
The Court has set the deadline for the Exclusive Period for
ASARCO, Encycle, Inc., and ASARCO Consulting, Inc. -- the
Asbestos Subsidiaries -- on March 7, 2006, and their
Solicitation Period on May 6, 2006.
The remaining group of Debtors' -- the October Filing
Subsidiaries -- Exclusive Period will expire on February 10,
2006, and their Solicitation Period will expire on April 11,
2006.
The October Filing Subsidiaries are: ALC, Inc., American
Smelting and Refining Company, AR Mexican Explorations, Inc., AR
Sacaton LLC, Asarco Master, Inc., Asarco Oil and Gas Company,
Inc., Bridgeview Management Company, Inc., Covington Land
Company, Government Gulch Mining Company, Ltd., and Salero
Ranch, Unit III, Community Association, Inc.
The Debtors seek a unified deadline for their Exclusive and
Solicitation Periods.
Thus, the Debtors ask the Court to extend their Exclusive and
Solicitation Period to the same date for all Debtors:
(a) June 5, 2006 for filing a plan of reorganization; and
(b) August 4, 2006, for solicitation of acceptances of the Plan.
Jack L. Kinzie, of Baker Botts LLP, in Dallas, Texas, asserts
that setting the expiration of the Exclusive Periods on the same
dates for all the Debtors will assist in the efficient
management of the Debtors' cases.
(Asarco Bankruptcy News, Issue No. 15; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ASBESTOS LITIGATION: Court Confirms Kaiser Reorganization Plan
--------------------------------------------------------------
The US Bankruptcy Court in Delaware confirmed Kaiser Aluminum
Corporation's second amended Plan of Reorganization, which must
be affirmed by the District Court before the Company can emerge,
BusinessWire reports.
The Company's restructuring would resolve pre-petition claims
that are currently subject to compromise including retiree
medical, pension, asbestos, and other tort, bond, and note
claims.
All personal injury claims relating to both pre-petition and
future claims for asbestos, silica and coal tar pitch volatiles,
and existing claims regarding noise-induced hearing loss, would
be permanently resolved by the formation of certain trusts
funded by Kaiser's rights to proceeds from some of its insurance
policies and the establishment of channeling injunctions that
would permanently channel these liabilities away from Kaiser and
into the trusts.
The POR would also result in the cancellation of the equity
interests of current stockholders and the distribution of equity
in the emerging company to creditors or creditor
representatives.
The majority of the new equity would be distributed to two
voluntary employee benefit associations that were created in
2004 to provide medical benefits or funds to defray the cost of
medical benefits for salaried and hourly retirees.
"We are very pleased by the ruling and it means that the finish
line is within sight," said Jack Hockema, president and chief
executive officer, Kaiser Aluminum. "We are hopeful that we can
proceed quickly through the steps necessary for us to emerge
before the end of the first quarter of 2006."
Foothill Ranch, CA-based Kaiser Aluminum Corporation produces
fabricated aluminum products for aerospace and high-strength,
general engineering, automotive, and custom industrial
applications.
ASBESTOS LITIGATION: Compensation Fund Progresses to Next Stage
---------------------------------------------------------------
With a 98-1 Senate vote, lawmakers move forward the plan to
create an asbestos compensation fund, which would gather US$140
billion to stem a tide of litigation dating from the 1970s up to
the present, the Star Tribune reports.
Senator Minority Leader Harry Reid, a Nevada Democrat, requested
the vote to proceed to debate. He ultimately voted against his
own motion to open the debate after concluding he did not have
the votes to stop the legislation.
The sole vote to block the debate came from Oklahoma Republican
Senator James M. Inhofe.
The vote was significant because a defeat would have doomed the
legislation this year. Final action on the measure is weeks
away, and the measure faces significant hurdles even though it
has gained considerable momentum.
The bill, which would not provide federal money for settlement,
would restrict asbestos victims from bringing their claims into
court and would limit the liability of makers and insurers but
force them to make contributions to the fund.
The bill would set a schedule of payments, based on the severity
of the illness, ranging from US$25,000 for breathing impairments
to as much as US$1.1 million for victims of mesothelioma, a
lethal cancer of the lungs. Fees for lawyers would be capped at
5% of the final award.
Compensation plan supporters say it is needed to defuse an
increasingly costly wave of litigation and economic uncertainty
faced by companies over lawsuits. Asbestos manufacturers and
their insurance firms would finance the fund.
Opponents have argued that the fund could prove insufficient,
relieving companies of the financial burden and possibly
shifting it to taxpayers.
Asbestos was widely used for their insulating and fire-retardant
capabilities, but they are linked to lung-scarring diseases,
including cancer. Hundreds of thousands of asbestos injury
claims have been filed, bankrupting some 70 companies, including
W.R. Grace & Co. and USG Corp.
ASBESTOS LITIGATION: Property Casualty Opposes Trust Fund Bill
--------------------------------------------------------------
Property Casualty Insurers Association of America, an industry
organization comprised of more than 1,000 insurance companies,
asserts opposition to S. 852, the Fairness in Asbestos Injury
Resolution (FAIR) Act, the Insurance Journal reports.
The Group calls the legislation "well intentioned" but
representing "a potential public policy disaster."
PCI president and CEO Ernie Csiszar said that the current
legislation has been "cobbled together in an effort to satisfy
all political factions, without due diligence given to the
effects the bill will have on asbestos victims, employers,
insurers, and our nation's economy."
According to PCI, S. 852 lacks two key provisions that are
needed to resolve the asbestos litigation crisis.
"There is no certainty that the contributions made to the fund
by insurers and businesses will be enough to cover all valid
asbestos claims," said Mr. Csiszar.
"The potential costs of the bill lie not just in the US$46
billion insurers will be responsible for providing to the trust
fund, but in the countless billions in legal costs insurers will
spend on cases that the trust fund does not cover," Mr. Csiszar
further stated.
Asbestos was widely used for their insulating and fire-retardant
capabilities, but they are linked to lung-scarring diseases,
including cancer. Hundreds of thousands of asbestos injury
claims have been filed, bankrupting some 70 companies, including
W.R. Grace & Co. and USG Corp.
ASBESTOS LITIGATION: Govt. Study Sees US$150B Fund Shortfall
------------------------------------------------------------
An analysis by the Senate Budget Committee Democrats states that
a proposed fund to compensate people suffering from asbestos-
related diseases would have at least a US$150 billion shortfall,
Reuters reports.
Kent Conrad, the committee's ranking Democrat, said he feared
taxpayers would have to pay the shortfall if the legislation to
create the fund, now pending in the Senate, is passed.
The bill calls for collecting US$140 billion from asbestos
defendant companies and their insurers for the proposed trust
fund.
However, the Budget Committee's Democratic analysis said that
the amount of asbestos injury claims and cost to run the fund
would far exceed that amount, Mr. Conrad told reporters.
ASBESTOS ALERT: Rodgers' Case Remanded to Clear Succession Issue
----------------------------------------------------------------
The California Court of Appeal for the First District remanded
James Rodgers' asbestos personal injury case to the San
Francisco County Superior Court to resolve certain defendants'
successor liability issues.
Judge Douglas E. Swager, together with Presiding Judge James J.
Marchiano and Judge Sandra L. Margulies, reviewed Case No.
A110023, decided on January 30, 2006.
On December 5, 2000, Mr. Rodgers sued Sargent Controls &
Aerospace and other defendants for Mr. Rodgers' occupational
exposure to "asbestos and asbestos-containing products," which
made him develop asbestosis and other lung damage.
Sargent Controls & Aerospace was alleged to be liable to Mr.
Rodgers as a successor-in-interest to other firms: Sargent
Industries, Inc., Kahr Bearing Corp., Aetna Steel Products
Corp., and Arnot Marine Corp.
Sargent Controls sought summary judgment citing that it was not
a successor-in-interest of Arnot, which was alleged to be a
source of Mr. Rodgers asbestos exposure. Sargent Controls also
asserted that Mr. Rodgers failed to prove his exposure to
asbestos-containing products installed by Arnot.
For lack of any successor liability, the San Francisco County
Superior Court granted Sargent Controls' motion for summary
judgment and remanded the case to the trial court to resolve the
issue of Sargent's liability to Mr. Rodgers as a successor-in-
interest of Arnot.
Alan R. Brayton, Gilbert L. Purcell, Lloyd F. LeRoy, David L.
Fiol, and Nance F. Becker, of Brayton Purcell represented James
Rodgers.
James P. Cunningham, Laurie J. Hepler, and Lee G. Sullivan, of
Carroll, Burdick & McDonough LLP represented Sargent Controls &
Aerospace.
COMPANY PROFILE
Sargent Controls & Aerospace
5675 West Burlingame Road
Tucson, Arizona, 85743 USA
Phone: 520.744.1000
Fax: 520.744.9290
24 Hour AOG: 520.703.6313
FAA Repair Station: S1CR155N
http://www.sargentcontrols.com/
Description:
Sargent Controls & Aerospace provides precision hydraulic
control components and specialty and self-lubricated lined
bearings to commercial and military aircraft and US Naval
Nuclear Class submarines. The Company also serves the aerospace
aftermarket through its industry leading turn-times and OEM
expertise and quality.
ASBESTOS ALERT: Court Reverses Fuller-Austin Bankruptcy Ruling
--------------------------------------------------------------
The Court of Appeal in California reversed a Los Angeles
Superior Court ruling, which stated that bankruptcy determined a
Company's liability and combined value to indemnify asbestos
claims.
Justice Kathryn Doi Todd, with Presiding Justice Roger W. Boren
and Justice Judith M. Ashmann-Gerst, reviewed Case No. B170079
filed on January 19, 2006.
Certain Underwriters at Lloyd's, London and Certain London
Market Insurance Companies; Stonewall Insurance Co.;
Transcontinental Insurance Co. and Columbia Casualty Co. (CNA);
First State Insurance Co., New England Reinsurance Corp., and
Twin City Fire Insurance Co. (First State); and International
Insurance Co. appeal from the Superior Court decision in favor
of Fuller-Austin Insulation Co.
From the 1940s to the 1980s, Fuller-Austin installed and removed
asbestos-containing building products. In 1974, DynCorp acquired
Fuller-Austin, which was a subsidiary until 1987. Insurance
companies issued excess policies to Fuller-Austin or DynCorp
that covered periods during which Fuller-Austin was in
operation.
In a suit filed on November 1994, Fuller-Austin sought to
establish coverage for past, present and future asbestos bodily
injury claims under multiple general liability, excess and
umbrella policies.
With approval from 75% of asbestos claimants, Fuller-Austin
filed for Chapter 11 bankruptcy in the Delaware Federal District
Court on September 4, 1998.
On November 13, 1998, the Bankruptcy Court issued findings of
fact and conclusions of law, and confirmed the Bankruptcy Plan,
which became effective on December 11, 1998.
On August 1, 2003, the trial court entered judgment. On
September 18, 2003, the trial court denied a new trial and
judgment and awarded certain costs to Fuller-Austin.
The Appeal Court reversed the judgment to the extent it imposes
liability on the insurance firms, to the extent it requires them
to pay a sum for present and future asbestos claims against
Fuller-Austin, and to the extent that any indemnification was
calculated on a certain basis.
Alschuler Grossman Stein & Kahan, Frank Kaplan, Kenneth S.
Meyers; Spepanik Cortner McNaboe Colliau & Jordan and Michael T.
Colliau represented Transcontinental Insurance Co. and Columbia
Casualty Co.
Hogan & Hartson, Kenneth D. Klein, David R. Singer, William J.
Bowman, James P. Ruggeri, Catherine E. Stetson; Wilmer Cutler
Pickering Hale and Dorr, Seth P. Waxman, Jonathan E.
Nuechterlein, Craig T. Goldblatt and Todd Zubler represented
First State Insurance Co., New England Reinsurance Corp., and
Twin City Fire Insurance Co.
Berkes Crane Robinson & Seal, Steven M. Crane, Barbara S.
Hodous; Munger, Tolles & Olson, Ronald L. Olson, Kelly M. Klaus,
Paul J. Watford, Sarah E. Kurtin and Grant A. Davis-Denny
represented Stonewall Insurance Co.
Hancock Rothert & Bunshoft, Patrick A. Cathcart, William J.
Baron; Wachtell, Lipton, Rosen & Katz, Michael W. Schwartz,
Douglas K. Mayer, William Savitt; Greines, Martin, Stein &
Richland, Irving H. Greines, Robert A. Olson and Peter O. Israel
represented Certain Underwriters at Lloyd's London and Certain
London Market Insurance Companies.
Sonnenschein Nath & Rosenthal and Ronald D. Kent represented
International Insurance Co.
Morgan, Lewis & Bockius, Michel Y. Horton, Thomas M. Peterson,
Jason B. Komorsky, Laura R. Ramos; Anderson Kill & Olick, Robert
M. Horkovich, Rhonda D. Orin and Robert Y. Chung represented
Fuller-Austin Insulation Co.
ASBESTOS ALERT: TX Court Rejects Aleman Appeal in Suit v. Marsh
---------------------------------------------------------------
For lack of jurisdiction, the Texas Court of Appeals dismissed
an appeal filed by Maximino R. Aleman and other individuals
against several defendants in asbestos-related litigation.
Chief Justice Rogelio Valdez, with Justices Frederico G.
Hinojosa and Linda Reyna Yanez, heard Case No. 13-04-084-CV,
delivered and filed on January 26, 2006.
Maximino R. Aleman and other appellants sued asbestos defendants
and various insurers, including Marsh USA, Inc. (Delaware) and
Marsh USA, Inc. (Texas).
The Nueces County District Court approved Marsh's filing of
special exceptions to appellants' several amended petitions,
alleging that they possessed no duty to the appellants.
On October 30, 2003, the District Court granted Marsh's special
exceptions and dismissed appellants' claims. On February 12,
2005, appellants appealed and filed a motion to extend their
appeal.
Appellants received an extension to file their reply to the
dismissal motion until 30 days following the filing of the
clerk's record. The record currently before the Court did not
contain any document that would constitute a final judgment.
Because the order of severance did not result in a final
judgment in the severed action, the Appeals Court concluded that
the action is still pending and is not yet subject to appeal.
COMPANY PROFILE
Marsh Inc.
1166 Avenue of the Americas
New York, NY 10036-2424
Phone: 212-345-6000
Fax: 212-345-4808
http://www.marsh.com
Description:
New York, NY-based, Marsh Inc. sells insurance and provides
risk-management services primarily to corporate clients in Asia,
Europe, and North and South America. The Company gets about half
its revenues from outside the US. Marsh & McLennan Companies
Inc. is the parent firm of Marsh Inc.
New Securities Fraud Cases
AMKOR TECHNOLOGY: Stull Stull Files Securities Fraud Suit in Pa.
----------------------------------------------------------------
Stull Stull & Brody initiated a class action in the United
States District Court for the Eastern District of Pennsylvania
on behalf of all securities purchasers of Amkor Technology, Inc.
(AMKR) ("Amkor" or the "Company") from October 27, 2003 through
July 1, 2004 inclusive (the "Class Period").
The complaint charges Amkor and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Amkor operates as a subcontractor of semiconductor
packaging and test services worldwide. It offers traditional
packaging, which includes traditional lead frame products; and
advanced packaging, which includes advanced lead frames and
laminate products. The complaint alleges that defendants issued
a series of false and misleading statements to the market
artificially inflating the Company's stock. As a consequence of
the Company's material inflation of its stock price, the
Defendants were able to raise $152 million in a secondary
offering and to complete a $250 million note offering. More
specifically, the Defendants failed to disclose the following
materially adverse facts to be market:
(1) that the Company was shipping inventory to customers
far in excess of customer demand;
(2) as a result of this deliberate channel stuffing, the
Company undermined the future demand for its products;
(3) that the Company's profit margins were significantly
and negatively impacted by the rapidly rising material
costs; and
(4) that as a consequence of the foregoing, the Company's
positive statements about its condition and future
prospects were lacking in a reasonable basis.
On April 27, 2004, Amkor announced that the Company was
experiencing weakness for its cellphone products. On this news,
shares of Amkor fell $4.26 per share, or 31.74 percent, to
close, on April 27, 2004, at $9.16 per share. Following this
disclosure, on July 1, 2004, Amkor announced that it failed to
meet its expected guidance for net income in the second quarter
of 2004. On this news, shares of Amkor fell $2.39 per share, or
20.22 percent, to close, on July 1, 2004, at $5.79 per share.
Then, on August 22, 2005, Amkor announced that the SEC issued a
former order of investigation concerning certain trading in
Amkor securities.
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.
APPLICA INC.: Schatz & Nobel Files Securities Fraud Suit in Fla.
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The law firm of Schatz & Nobel, P.C., which has significant
experience representing investors in prosecuting claims of
securities fraud, announces that a lawsuit seeking class action
status has been filed in the United States District Court for
the Southern District of Florida on behalf of all persons who
acquired the common stock of Applica Incorporated ("Applica" or
the "Company") (APN) between November 4, 2004 and April 28,
2005, inclusive, (the "Class Period").
The Complaint alleges defendants violated federal securities
laws by issuing a series of materially false statements
regarding Applica's financial condition. Specifically,
defendants failed to disclose that:
(1) Applica was experiencing decreasing demand for its
products. In particular, Tide(tm) Buzz(tm) Ultrasonic
Stain Remover and Home Cafe(tm) single cup coffee
maker, were not meeting internal expectations;
(2) Applica was materially overstating its net worth by
failing to timely write down the value of its inventory
which had become obsolete and unsaleable;
(3) Applica was experiencing higher product warranty
returns, which it had not appropriately reserved for;
and
(4) Applica's financial statements issued during the Class
Period were not prepared in accordance with Generally
Accepted Accounting Principles ("GAAP") and therefore
were materially false and misleading.
The Complaint further alleges that, on April 20, 2005,
defendants revealed that the Company would not come near
achieving the guidance they had previously sponsored and/or
endorsed, that Applica's business was suffering from numerous
adverse factors and that the Company was marking down inventory
and experiencing increased warranty expenses. Then, on April
28, 2005, defendants further detailed the impact of these
adverse factors on Applica's business. These belated
disclosures had an immediate, adverse impact on the price of
Applica shares.
For more details, contact Schatz & Nobel, P.C., Phone:
(800) 797-5499, E-mail: sn06106@aol.com, Web site:
http://www.snlaw.net.
DOT HILL: Lerach Coughlin Lodges Securities Fraud Suit in Calif.
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Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, filed a
class action in the United States District Court for the
Southern District of California on behalf of purchasers of Dot
Hill Systems Corp. ("Dot Hill") (HILL) common stock during the
period between April 23, 2003 and February 3, 2005 (the "Class
Period").
The complaint charges Dot Hill and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Dot Hill is a provider of innovative design and delivery
of storage network solutions to channel and OEM partners
worldwide. The Company provides scalable, rugged, highly
available data storage products for mission-critical
applications.
The complaint alleges that during the Class Period, defendants
issued materially false and misleading financial statements to
the investing public due to improper revenue recognition and
inadequate internal controls. As a result of defendants' false
financial statements, Dot Hill stock traded at artificially
inflated prices.
On February 3, 2005, the Company announced its preliminary Q4 04
financial results and that it would be restating its 2004
unaudited financial results due to a data entry error that the
Company attributed to "the material weaknesses in its internal
control over its financial closing process." The Company also
stated that it had "identified other errors pertaining to the
quarters ended March 31, 2004, June 30, 2004 and September 30,
2004 that it deems immaterial, including: the incorrect
classification of certain product costs as operating expenses,
the failure to eliminate corresponding revenue and cost of goods
sold entries and the presence of duplicate entries."
The complaint alleges that the true facts, which were known by
each of the defendants but concealed from the investing public
during the Class Period, were as follows:
(1) the Company's accounting department suffered from
material weaknesses and deficiencies and lacked the
necessary staff and resources to perform its required
functions;
(2) the Company's inadequate internal accounting process
and controls enabled Dot Hill management to manipulate
the Company's Costs of Goods Sold ("COGS") and
routinely and inappropriately misclassify "expenses"
causing Dot Hill to issue false financial statements;
(3) multiple areas of the Company's internal controls
suffered serious deficiencies;
(4) the Company lacked effective internal controls in its
financial reporting process; and
(5) the Company falsely reported its Q1-Q3 04 financial
results by improperly recognizing revenue and by
improperly recording expenses.
As a result of defendants' allegedly false statements, Dot
Hill's stock traded at inflated levels during the Class Period,
increasing to as high as $17.37 on December 1, 2003. The
Company's shares now trade at around $6.00 per share, 66% below
the Class Period high.
For more details, contact Darren Robbins of Lerach Coughlin
Stoia Geller Rudman & Robbins, LLP, Phone: 800-449-4900, E-mail:
wsl@lerachlaw.com.
JARDEN CORP: Roy Jacobs Files Securities Fraud Suit in S.D. N.Y.
----------------------------------------------------------------
Roy Jacobs & Associates initiated a lawsuit seeking class action
status in the United States District Court for the Southern
District of New York on behalf of all persons who purchased the
publicly traded securities of Jarden Corp. ("Jarden") between
June 29, 2005 and January 11, 2006 (the "Class Period").
The Complaint alleges that Jarden and CEO Martin Franklin
("Franklin") violated the federal securities laws in connection
with a scheme to convert hundreds of millions of dollars of
convertible stock to common stock, and earn defendant Franklin
tens of millions of dollars in restricted stock compensation.
Specifically, it is asserted that Franklin misrepresented the
business situation and potential of the Holmes Group, Inc. when
that company was acquired by Jarden at the beginning of the
Class Period. This caused the stock to rise substantially,
triggering the personal benefits to Franklin. On January 11,
2006 Jarden announced that Holmes' profit margins and product
mix were not what the market had been led to expect. On this
news, Jarden's stock fell substantially.
For details, contact Roy L. Jacobs, Esq. of Roy Jacobs &
Associates, Phone: 1-888-884-4490, E-mail:
classattorney@pipeline.com.
LAFARGE NORTH: Bull Lifshitz Files Securities Fraud Suit in Md.
---------------------------------------------------------------
Bull & Lifshitz, LLP filed a securities class action in the
Circuit Court of Baltimore City, Maryland, on behalf of owners
of the common stock of Lafarge North America Inc., ("Lafarge NA"
or the "Company").
The Complaint alleges that Lafarge S.A. allegedly owns
securities representing approximately 52% of Lafarge NA's
outstanding equity securities. Lafarge S.A. intends to make an
offer to purchase all outstanding shares of common stock of
Lafarge NA not owned by Lafarge S.A. or its affiliates, at a
price of $75.00 per share.
The Complaint alleges that the price of $75.00 per share offered
to the class members is unconscionable, unfair and grossly
inadequate consideration and has been the object of manipulation
because, among other things:
(1) the intrinsic value of the stock of Lafarge NA is
materially in excess of $75.00 per share, giving due
consideration to the possibilities of growth and
profitability of Lafarge NA in light of its business,
earnings and earnings power, present and future;
(2) the $75.00 per share price is inadequate and offers an
inadequate premium to the public stockholders of
Lafarge NA; and
(3) the $75.00 per share price is not the result of arm's
length negotiations but was fixed arbitrarily by
Lafarge S.A. to "cap" the market price of Lafarge NA
stock, as part of a plan for defendants to obtain
complete ownership of Lafarge NA assets and business at
the lowest possible price.
For more details, contact Joshua M. Lifshitz, Esq. of Bull &
Lifshitz, LLP, 18 East 41st Street, New York, NY 10017, Phone:
(212) 213-6222, Fax: (212) 213-9405, E-mail:
counsel@nyclasslaw.com.
LAFARGE NORTH: Entwistle & Cappucci Files Securities Suit in Md.
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Entwistle & Cappucci, LLP, initiated a class action lawsuit in
the Circuit Court of Baltimore City, Maryland on behalf of
stockholders of Lafarge North America, Inc. ("Lafarge North
America" or the "Company") (LAF) against Lafarge North America,
Lafarge S.A., Bertrand P. Collomb, Bernard L. Kasriel, Philippe
R. Rollier, Marshall A. Cohen, Philippe P. Dauman, Bruno Lafont,
Claudine B. Malone, Blythe J. McGarvie, James M. Micali, Robert
W. Murdoch, Bertin F. Nadeau, John D. Redfern, Michel Rose and
Lawrence M. Tanenbaum. Lafarge North America operates as a
supplier of construction materials in the United States and
Canada, providing cement, ready-mixed concrete, gypsum
wallboard, aggregates, asphalt and related products and
services.
On February 6, 2006, the French parent company of Lafarge North
America, Lafarge S.A., which owns approximately 53% of Lafarge
North America's outstanding common stock, announced its
intention to commence a tender offer for all outstanding shares
of common stock of the Company, at a purchase price of $75.00
per share (the "Offer"). The Offer, as priced, represents only
a 16.7% premium over the closing price on February 3, 2006. As
recently as October 2, 2005, Lafarge North America's shares
traded as high as $70.47 per share. Moreover, the action
alleges that the Offer is grossly inadequate in light of Lafarge
North America's projected growth and profitability. The $75.00
price per share does not adequately value the Company in light
of its recent, outstanding financial performance as announced on
February 1, 2006. At that time, the Company reported its
fourth-quarter results, which included a 47% surge in its
profits and a 14% increase in revenues as compared with the
year-ago quarter.
The class action is brought on behalf of the public minority
stockholders of Lafarge North America, to void and enjoin the
efforts to deprive the company's minority shareholders of their
equity interest in Lafarge North America at a grossly unfair and
inadequate price and to usurp the benefits of the Company's
growth and future prospects for the defendants' own benefit.
For more details, contact Stephen D. Oestreich, Esq., Robert N.
Cappucci, Esq., William W. Wickersham, Esq. of Entwistle &
Cappucci LLP, New York, Phone: 212-894-7200, Fax: 212-894-7272,
E-mail: soestreich@entwistle-law.com, rcappucci@entwistle-
law.com and wwickersham@entwistle-law.com, Web site:
http://www.entwistle-law.com.
ROYAL GROUP: Schiffrin & Barroway Lodges Securities Suit in N.Y.
----------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP initiated a class
action lawsuit against Royal Group Technologies, Ltd. (RYG)
("Royal Group" or the "Company") in the United States District
Court for the Southern District of New York on behalf of a class
consisting of all United States citizens and entities that
purchased or otherwise acquired the common stock of Royal Group
on the New York Stock Exchange ("NYSE") or the Toronto Stock
Exchange ("TSE"); and all foreign persons and entities that
purchased or otherwise acquired the common stock of Royal Group
on the NYSE between February 24, 2000 and October 18, 2004,
inclusive (the "Class Period").
The complaint charges Royal Group and certain of its officers
and directors with violations of the Securities Exchange Act of
1934. Royal Group is a vertically integrated manufacturer of
polymer-based home improvement, consumer and construction
products. More specifically, the Defendants failed to disclose
the following materially adverse facts to the market:
(1) that Individual Defendants abused their control over
the Company to engage in a series of undisclosed
related-party transactions and self-dealing
transactions, which were never disclosed to
shareholders;
(2) as a result of this abuse of power, the Individual
Defendants reaped substantial personal gains from their
dealings;
(3) that the undisclosed self-dealing and related-party
transactions caused the Company to misappropriate
millions of dollars;
(4) that the Company lacked adequate controls in place to
ensure that related- party transactions were disclosed
to the Company's shareholders; and
(5) that the Company's financial results were not prepared
in accordance with Canadian Generally Accepted
Accounting Principles ("Canadian GAAP") or reconciled
with US Generally Accepted Accounting Principles ("US
GAAP").
On February 25, 2004, Royal Group revealed that it was the
subject of an investigation by the Ontario Securities Commission
(the "OSC") into the flow of goods and services between the
Company and a resort owned by De Zen. In response to this
announcement, Royal Group purportedly organized a so-called
Special Committee to conduct an "independent" inquiry into the
conduct that the OSC was investigating. The Special Committee
quickly concluded that there was no evidence of wrongdoing.
On October 15, 2004, the Company announced that the Company
insiders were the subject of the Royal Canadian Mounted Police's
("RCMP") criminal investigation in connection with their
engaging in self-dealing transactions with Royal Group. Then, on
October 18, 2004 (after the close of trading), the Company
announced that the Company itself, as well as the Company
insiders, were being criminally investigated by the RCMP in
connection with the defendants' self-dealing transactions. As a
result of the revelations of the substantial self-dealing
transactions by Defendants, shares of Royal Group fell $1.12 per
share, or 12.49 percent, on October 18, 2004 (the first day of
trading after the disclosure of the RCMP's investigation into
the Company), to close at $7.85 per share.
For more details, contact Darren J. Check, Esq. and Richard A.
Maniskas, Esq. of Schiffrin & Barroway, LLP, 280 King of Prussia
Road, Radnor, PA 19087, Phone: 1-888-299-7706 or 1-610-667-7706,
E-mail: info@sbclasslaw.com.
*********
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asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
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*********
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Class Action Reporter is a daily newsletter, co-published by
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Editors.
Copyright 2006. All rights reserved. ISSN 1525-2272.
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