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C L A S S A C T I O N R E P O R T E R
Friday, July 28, 2006, Vol. 8, No. 149
Headlines
ANTARES INVESTMENT: Antique Dealers Sue Over Yale & Towne Fire
BAYER AG: Sept. Hearing Set for Rubber Chemicals Suit Settlement
CALIFORNIA: County to Appeal Strip Search Ruling to High Court
CALIFORNIA: Court Hears Arguments in High School Exit Exam Case
DELAWARE: Convicted Ax Murderer Questions Execution Method
EPHEDRA LITIGATION: FDA Seeks Reinstatement of Diet Pill Ban
GEORGIA: Ga. Judge Allows Bus Stop Law Against Sex Offenders
IMPERIAL TRADING: Aug. Trial Set for Junk Faxes Suit Settlement
INTELLIGROUP INC: Continues to Face N.J. Securities Fraud Suit
INTERLINK ELECTRONICS: Still Faces Securities Suit in Calif.
KENTUCKY: Resident Sues City, Sanitation District for Sewer Fees
KOREA: Yeongdeungpo-gu Residents File Suit Over Flood Damage
MCI COMMUNICATIONS: Sept. Hearing Set for D.C. Stock Suit Deal
MEDICAL SAVINGS: Faces Suit in Fla. Over Insurance Policy Add-On
MICROSOFT CORP: $1.1B Antitrust Settlement Ready for Allocation
MICROSOFT CORP: Calif. Schools to Receive $600M from Settlement
NPS PHARMACEUTICALS: Facing Securities Fraud Lawsuit in Utah
PARLUX FRAGRANCES: Faces Fla. Shareholder's Suit Over PFA Offer
PUTNAM FUND: High Court Remands Ruling in Securities Fraud Suit
ROYAL OASIS: Timeshare Owners File Suit in Fla. Over Closure
SEARS CANADA: Lawsuits Over Tire Pricing, Sears Card Continue
SILICON LABORATORIES: IPO Suit Settlement Yet to Obtain Court OK
STORA ENSO: Files Response to Paper Price Manipulation Lawsuit
SUPER STEEL: Increases Reward to Find Author of Racist Message
TENNESSEE: Lawyers Want Out of East High School Black Mold Suit
WEST CORP: Shareholder Files Lawsuit in Nebr. Over $4.1B Sale
Asbestos Alert
ASBESTOS LITIGATION: Suits v. AB Electrolux Rise by 50 to 1,162
ASBESTOS LITIGATION: Honeywell Posts $1.491B Liabilities at 2Q06
ASBESTOS LITIGATION: PPG Industries Inc. Has $280M Income in 2Q
ASBESTOS LITIGATION: PPG Ind.'s Settlement for Claims Hit $560M
ASBESTOS LITIGATION: Honeywell Int'l Has $49M Charges for Claims
ASBESTOS LITIGATION: Honeywell Estimates $1.7B for NARCO Claims
ASBESTOS LITIGATION: Travelers Sues Honeywell Over NARCO Claims
ASBESTOS LITIGATION: Honeywell Notes 72,174 Bendix Claims in 2Q
ASBESTOS LITIGATION: Honeywell Has $2.011B Liability for Claims
ASBESTOS LITIGATION: RPM International Posts $335M Charges in 4Q
ASBESTOS LITIGATION: RPM Int'l. Has $58.9Mil Current Liabilities
ASBESTOS LITIGATION: Crane Posts Long-term Liability at $509.5M
ASBESTOS LITIGATION: Crane Co. Records 88,833 Claims in 2Q06
ASBESTOS LITIGATION: Crane Settles With 2 Insurers in Conn. Suit
ASBESTOS LITIGATION: USG Records $27M Reversal of Claims Reserve
ASBESTOS LITIGATION: BOC Group Faces About 15,966 Injury Claims
ASBESTOS LITIGATION: Corning Records $7Mil Settlement Adjustment
ASBESTOS LITIGATION: BNSF Railway's Claims Remain at 2,153 in 2Q
ASBESTOS LITIGATION: ENSCO Has Multiparty Suits in Miss. Courts
ASBESTOS LITIGATION: LECO Faces Claims With 33,604 Plaintiffs
ASBESTOS LITIGATION: American Standard Has 114,669 Claims in 2Q
ASBESTOS LITIGATION: American Standard Has Action in N.J. Court
ASBESTOS LITIGATION: Litigation Ebbs in Face of Legal Reforms
ASBESTOS LITIGATION: W.R. Grace, Creditors Unable to Strike Deal
ASBESTOS ALERT: Court Issues Split Ruling on Greene, Tweed Suit
New Securities Fraud Cases
NPS PHARMACEUTICALS: Federman & Sherwood Reports Filing of Suit
PAR PHARMACEUTICAL: Schiffrin & Barroway Files Stock Lawsuit
RAMBUS INC: Schatz & Nobel Announces Filing of Calif. Stock Suit
VONAGE HOLDINGS: Aug. 1 Deadline Set for Lead Plaintiff Filing
ZALE CORP: Stull, Stull Announces Filing of N.Y. Securities Suit
*********
ANTARES INVESTMENT: Antique Dealers Sue Over Yale & Towne Fire
--------------------------------------------------------------
A piano shop owner and three companies are facing a class action
filed by attorneys of antique dealers who lost millions in a
fire at the old Yale & Towne site, Connecticut in April, the
Stamford Advocate reports.
Antares Investment Partners, the owner of the piano shop were
the blaze started, and two financial companies that backed
Antares' purchase of the property in the area are named as
defendants. Antares is accused of failing to meet fire codes,
while Paul Haller, owner of Haller Piano, is accused of
permitting "dangerous conditions to exist" in his shop by
storing flammable refinishing chemicals near the bench.
The suit was filed by Bainton McCarthy LLC of New York --
http://www.baintonlaw.com/firm.html-- and attorney Anthony
Truglia Jr. on behalf of about 100 tenants who rented space in
the Stamford Antiques Center.
On April 3 a fire spread from a small piano shop into seven
other businesses at 735 Canal St. Investigations by authorities
reportedly found out that Investment Partners officials knew
that a sprinkler system provided for in cases of fire in the
area was broken when they bought the site, but failed to repair
it.
BAYER AG: Sept. Hearing Set for Rubber Chemicals Suit Settlement
----------------------------------------------------------------
The U.S. District Court for the Northern District of California
will hold a fairness hearing on Sept. 12, 2006, at 9:30 a.m. for
Bayer AG and Bayer Corp.'s proposed $250 million settlement in
the matter, "In Re Rubber Chemicals Antitrust Litigation, MDL
Docket No. C-04-1648 (MJJ)."
The hearing will be held at the U.S. District Court for the
Northern District of California, 450 Golden Gate Ave., Courtroom
11, 19th Floor, San Francisco, CA 94102.
Objections to the settlement must be mailed no later than Aug.
7, 2006. Deadline for submission of proof of claim is on Sept.
30, 2006.
The case was brought on behalf of all persons and entities in
the U.S. and its territories, excluding government entities,
that directly purchased rubber chemicals from any defendant at
anytime from May 1, 1995 to Dec. 31, 2001.
The first complaint in this action was filed in the U.S District
Court for the Northern District of California on April 8, 2003.
That case and several subsequently filed cases were consolidated
and a consolidated amended complaint was filed on Nov. 3, 2003.
On or about March 15, 2005, plaintiffs filed their second
amended consolidated complaint. The complaint alleges that the
defendants conspired to fix or maintain the prices of, and/or
allocate markets for, Rubber Chemicals sold in the U.S. in
violation of Section 1 of the Sherman Act, 15 U.S.C. Section 1.
It also alleges that, as a result of this conspiracy, members of
the class paid more for Rubber Chemicals than they otherwise
would have and, thus, were injured.
For more details, contact:
(1) Gilardi & Co., LLC, 3301 Kerner Boulevard, San Rafael,
CA 94901, Phone: 415-461-0410, Fax: 415-461-0412, E-
mail: classact@gilardi.com, Web site:
http://www.gilardi.com/php/all.php.
(2) Richard A. Koffman of Cohen, Milstein, Hausfeld & Toll,
P.L.L.C., 1100 New York Avenue, N.W., Suite 500 West,
Washington, District of Columbia 20005-3964, Phone:
202-408-4600, Fax: 202-408-4699, Web site:
http://www.CMHT.com;and
(3) Steven O. Sidener of Gold Bennett Cera & Sidener, LLP,
595 Market Street, Suite 2300, San Francisco,
California 94105, (San Francisco Co.), Phone: 415-777-
2230, Fax: 415-777-5189, Web site:
http://www.gbcslaw.com.
CALIFORNIA: County to Appeal Strip Search Ruling to High Court
--------------------------------------------------------------
The Ventura County Board of Supervisors will appeal a federal
appeals court's ruling on jail strip searches to the U.S.
Supreme Court, according to Ventura County Star.
In a unanimous 5-0 decision, the board agreed to ask the high
court to strike down the ruling that found a search of former
bartender Noelle Way was unconstitutional. Ms. Way's attorney
previously filed a class action on behalf of others who were
searched.
Ms. Way was arrested by a Ventura police officer in September
2000 on suspicions of being under the influence of a controlled
substance, a misdemeanor.
The officer took her to Ventura County Jail, where she went
through the booking process, which, following jail security
policy, included a strip search.
Ms. Way tested negative for drugs, bailed out of jail and was
never charged. In 2001, she sued the county over the strip
search policy in a class action, "Noelle Way v. Ventura County,
et al., Case No. 2:01-cv-05401-CBM-E."
Subsequently, a U.S. District Court for the Central District of
California ruled that a "blanket strip search" policy violated
Ms. Way's Fourth Amendment rights against illegal search and
seizure. The 9th Circuit U.S. Court of Appeals in San Francisco
upheld that decision in a 16-page ruling in April.
According to county officials, they decided to ask for the
review by the highest court due to the threat of multiple
damages and the lack of a consistent standard.
Jeff Held, a private attorney handling the case for the county,
told The Ventura County Star that he recommended appealing since
there were inconsistencies in the rulings.
Mr. Held pointed out that the 9th Circuit ruling contradicted
four previous rulings by the same court on visual strip searches
for drug charges as well as a state law allowing the practice.
He said the county has until Aug. 28 to file a writ asking for
Supreme Court review.
The suit is "Noelle Way v. Ventura County, et al., Case No.
2:01-cv-05401-CBM-E," filed in the U.S. District Court for the
Central District of California under Judge Consuelo B. Marshall
with referral to Judge Charles F. Eick.
Representing the plaintiffs is Earnest C.S. Bell, Earnest C.S.
Bell Law Offices, 3897 Market St., Ventura, CA 93003, Phone:
805-650-5458, Fax: 805-650-3778.
Representing the defendants are Jeffrey Held and Alan E.
Wisotsky of Alan E. Wisotsky Law Offices, 300 Esplanade Dr.,
Ste. 1500, Oxnard, CA 93036, Phone: 805-278-0920, Fax: 805-278-
0289.
CALIFORNIA: Court Hears Arguments in High School Exit Exam Case
---------------------------------------------------------------
The California Court of Appeal recently heard arguments from
both parties in a class action over the state's high school exit
exam, styled, "Valenzuela vs. O'Connell," according to The San
Francisco Chronicle.
A judge recently granted class-action status to the case by
ruling that the state failed to provide thousands of high school
seniors the education needed to pass the California High School
Exit Exam, in violation of their constitutional rights.
The lawsuit alleges that not all students had equal learning
opportunities, and denying them a diploma -- if all other
graduation requirements are met -- violates equal-protection
clauses of the state constitution.
In the recent hearing, the appellate judges grilled attorneys
from both sides with questions that examined the class action on
behalf of thousands of seniors who didn't pass the exit exam,
required of graduates for the first time this year.
The three judges essentially wanted to know if students were
denied an equal opportunity to learn what's on the California
High School Exit Exam and if so, should they receive a diploma
anyway, even if they didn't learn the required skills?
Within the next 3 months, the judges will decide whether to give
diplomas those students that earned the necessary credits, but
failed the exam. However, the judges' decision will almost
certainly be appealed to the California Supreme Court.
The hearing was the latest in a five-month case that bounced
around the judicial system as the courts addressed whether to
freeze the graduation requirement while the case proceeds to a
trial.
In May, an Alameda County Superior Court judge granted an
injunction in early May, however both the California Court of
Appeal and the state Supreme Court stayed the decision until the
appellate justices could consider the injunction more fully.
Presiding Justice Ignazio Ruvolo and Associate Justices Patricia
Sepulveda and Timothy Reardon gave little indication which way
they leaned in regards to the case, according to the report.
Case Background
Liliana Valenzuela and four of her fellow Richmond High School
students plus five others from around California filed the
lawsuit in 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 Students named in the complaint come from
Hayward, Newark, Oakland, Fair Oaks and Rialto (Class Action
Reporter, Feb. 10, 2006).
The plaintiff's arguments are:
(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.
For more details, contact Arturo J. Gonzalez of Morrison &
Foerster, LLP, 425 Market Street, San Francisco, California
94105-2482, Phone: 415-268-7000, Fax: 415-268-7522, Web site:
http://www.mofo.com/.
DELAWARE: Convicted Ax Murderer Questions Execution Method
----------------------------------------------------------
Attorneys for convicted ax murderer Robert W. Jackson III and
the Federal Community Defender's Office for the Eastern District
of Pennsylvania are considering turning his civil case that
raises constitutional questions about how Delaware's death
penalty is carried out into a class action, The News Journal
reports.
In Mr. Jackson's lawsuit, filed in the U.S. District Court for
the District of Delaware on May 8, 2006, and similar other cases
around the country, attorneys are questioning the chemicals used
in lethal injections -- supposed to be nearly instantaneous --
and the training of people who carry them out.
Specifically, the suit questions whether lethal injection is
truly quick and a humane way to die. It alleges that some
prisoners actually die a slow, lingering death by suffocation.
Mr. Jackson, 33, was convicted and sentenced to death for the
1992 ax murder of 47-year-old Elizabeth Girardi during a
burglary of her Hockessin home.
His suit placed an indefinite and unofficial hold on state's
death penalty, including his May 19 execution, especially after
Chief District Judge Sue L. Robinson ordered state officials to
respond to the case by Sept. 24.
Essentially, Mr. Jackson's execution is on hold while his
lawsuit works its way through the federal court system. And
since the case presents new challenges for the state's execution
methods -- specifically that it is cruel, unusual and
unconstitutional -- no other inmate is likely to be executed
until it is resolved.
"That is a fair assumption," according to Kevin J. O'Connell of
the state Public Defender's Office. Thomas A. Foley, Mr.
Jackson's attorney agrees.
However, Deputy Attorney General Loren C. Meyers told The News
Journal that it is "premature" to say that Mr. Jackson's case
has stopped all state executions, since no other inmate is
scheduled for execution in the next several months.
The events in Delaware have been expected since the U.S. Supreme
Court's ruling in June that allowed inmates to raise
constitutional questions about lethal injection in federal
court.
Mr. Jackson's lawsuit was filed less than two weeks before his
scheduled execution. At that time, Judge Robinson issued a
preliminary injunction blocking Mr. Jackson's execution, pending
the June ruling by the U.S. Supreme Court.
The suit is "Jackson v. Taylor et al., Case No. 1:06-cv-00300-
SLR," filed in the U.S. District Court for the District of
Delaware under Judge Sue L. Robinson.
Representing the plaintiffs is Michael Wiseman, Federal
Community Defender for the Eastern District of Pennsylvania,
Capital Habeas Unit, Federal Court Division, Defender
Association of Philadelphia, Curtis Center, Suite 545 West, 601
Walnut Street, Philadelphia, PA 19106, US, Phone: (215) 928-
0520, Fax: (215) 928-0825, E-mail: Michael_Wiseman@fd.org.
Representing the defendants is Loren C. Meyers, Department of
Justice, State of Delaware, 820 N. French Street, 8th Floor,
Carvel Office Building, Wilmington, DE 19801, Phone: (302) 577-
8500, E-mail: loren.meyers@state.de.us.
EPHEDRA LITIGATION: FDA Seeks Reinstatement of Diet Pill Ban
------------------------------------------------------------
The U.S. Food and Drugs Administration is asking the Federal
Appeals Court to reinstate the ban it placed on Ephedra diet
pills, which was overturned by a Utah judge
Citing that the FDA needed proof that the herb was harmful if
taken as directed, a Utah judge overturned the FDA's ban on
April 2005. The FDA has yet to provide the proof.
A ban is proposed for these ephedra dietary products:
-- Metabolife, -- MetaboLift,
-- Hydroxycut, -- Herbalife,
-- Herbalite, -- Stackers,,
-- Ripped Fuel, -- Extreme Ripped Force,
-- Diet Fuel, -- GH Fuel,
-- Herba Fuel, -- ThermiCare,
-- ETA Stack, -- Xenadrine RFA-1,
-- Ultimate Orange, -- Thermogenic Power, and
-- BetaLean
Diet pills containing herbal ephedra and mahuang are legally
available again, but the FDA still wants the effective weight
loss herb removed from diet supplements. Prescription weight
loss drugs cannot compete on a level playing field with ephedra
weight loss products.
Numerous medical reports, studies, articles, and government
agencies have indicated that ephedra dietary products can cause
sudden cardiac complications, strokes and seizures, which could
be fatal. Several organizations have already banned ephedra
such as the NCAA, the Olympic Committee and the National
Football League (Class Action Reporter, May 14, 2003).
Ephedra Lawsuit
On Jan. 9, 2002, Canada banned all sales of ephedra. On March
5, 2003, Suffolk County in New York was the first county to ban
ephedra.
On April 21, 2003, Public Citizen, one of the nation's leading
consumer advocacy groups, asked the FDA to ban the sale of
dietary supplements containing the herbal stimulant ephedra.
In May 2003, manufacturers of ephedra dietary products faced a
nationwide class action in the U.S. District Court for the
Northern District of Illinois (Class Action Reporter, May 14,
2003).
Named defendants in the suit are:
* Metabolife International,
* Cytodyne Technologies,
* MuscleTech,
* NVE Pharmaceuticals,
* Twin Laboratories, and
* EAS
The primary objectives of the suit were to:
(i) obtain a court order forcing defendants to cease and
desist from the manufacture and sale of ephedra dietary
products and issue a recall;
(ii) inform the public that consumers taking ephedra dietary
products are at an increased risk of sudden cardiac
complications, strokes, and seizures;
(iii) provide compensation to all victims for death and
personal injuries;
(iv) provide a fund for all users of ephedra dietary
products for medical monitoring; and
(v) reimburse monies paid for the ephedra dietary products
Ephedra on the net: http://www.superb-weight-loss.com.
GEORGIA: Ga. Judge Allows Bus Stop Law Against Sex Offenders
------------------------------------------------------------
Judge Clarence Cooper of the U.S. District Court for the
Northern District of Georgia refused to extend a temporary order
blocking the enforcement of a state law banning sex offenders
from living near school bus stops, The Associated Press reports.
Judge Cooper said blocking the bus stop law from taking effect
would be premature, according to the report. The law provides
that bus stops must be officially designated by local school
board. Judge Cooper did not rule on the measure's
constitutionality.
The Southern Center for Human Rights has filed a federal class
action over HB 1059 on June 20, 2006. HB 1059 broadens the law
governing where registered sex offenders may reside by
prohibiting them from living or working within 1,000 feet of any
child care facility, church, school or "area where minors
congregate," including parks and recreation facilities,
playgrounds, skating rinks, neighborhood centers, gymnasiums,
swimming pools and bus stops. The law also stiffens minimum
prison sentences and requires certain offenders to wear
electronic monitoring devices.
The suit contends that the law renders vast tracts of Georgia's
residential areas off-limits to state's roughly 11,000
offenders.
It also contends that HB 1059 turns the law "from one tailored
to keep offenders away from children into one that essentially
drives every person on the registry from all urban areas and
many rural areas."
Defendants in the case are:
-- Gov. Sonny Perdue;
-- Georgia Attorney;
-- General Thurbert E. Baker;
-- Scot Dean, Chief of Probation in Cedartown; and
-- Polk County Sheriff Robert Sparks.
Plaintiffs include Al Reginald Marks, Dewayne Owens, James
Victor Wilson, Janet Jenkins Allison, Jeffery York, Rev. Joel
Jones, Joseph Linaweaver, Lori Sue Collins, and Wendy Whitaker.
State attorneys, however, argue that the provision is necessary
to protect children. In disputing claims that sex offenders
would be forced to move, they argued that untold numbers of bus
stops don't meet the letter of the law, which requires that each
stop be officially designated by the school board.
SCHR attorneys explained that the law is the only one in the
nation that bans offenders from living and working near school
bus stops.
Last month's order by Judge Cooper only covers the school bus
stop provision and allowed the rest of the law to take effect on
July 1.
A copy of the complaint is available free of charge at:
http://ResearchArchives.com/t/s?bdb
The suit is "Whitaker et al v. Perdue et al., Case No. 4:06-cv-
00140-CC," filed in the U.S. District Court for the Northern
District of Georgia under Judge Clarence Cooper.
Representing the plaintiffs are:
(1) Stephen Brooks Bright of the Southern Center for Human
Rights, 83 Poplar Street, N.W., Atlanta, GA 30303-2122,
Phone: 404-688-1202, E-mail: sbright@schr.org;
(2) Margaret Fletcher Garrett of the American Civil
Liberties Union Foundation of Georgia, Inc., Suite 514
75 Piedmont Avenue, Atlanta, GA 30303, Phone: 404-523-
6201, E-mail: mgarrett@acluga.org;
(3) Sarah E. Geraghty of the Southern Center for Human
Rights, 83 Poplar Street, N.W., Atlanta, GA 30303-2122,
Phone: 404-688-1202, E-mail: sgeraghty@schr.org;
(4) Lisa L. Kung of the Southern Center for Human Rights
83 Poplar Street, N.W., Atlanta, GA 30303-2122, Phone:
404-688-1202;
(5) Elizabeth Lynn Littrell of the American Civil Liberties
Union Foundation of Georgia, Inc., Suite 514, 75
Piedmont Avenue, Atlanta, GA 30303, Phone: 404-523-
6201, E-mail: blittrell@acluga.org; and
(6) Gerald R. Weber of the American Civil Liberties Union
Foundation of Georgia, Inc., Suite 514, 75 Piedmont
Avenue, Atlanta, GA 30303, Phone: 404-523-6201, E-mail:
gweber@acluga.org.
IMPERIAL TRADING: Aug. Trial Set for Junk Faxes Suit Settlement
---------------------------------------------------------------
The Circuit Court of Cook County, Illinois County Department,
Chancery Division, will hold a fairness hearing on Aug. 7, 2006,
11:00 a.m. for the proposed $100,000 settlement in the matter:
"Jordan C. Block v. Imperial Trading, Ltd., Case No. No. 02 CH
15137."
The fairness hearing will be held at room 1703 of the Richard J.
Daley Center, 50 W. Washington, Chicago, IL 60602 before Judge
Patrick E. McGann.
The settlement affects all persons who, on or after Sept. 3,
1998, were sent advertising faxes by Imperial Trading, Ltd.
Jordan Block, represented by Edelman, Combs, Latturner &
Goodwin, LLC, filed the suit against Imperial Trading Ltd.,
alleging that it sent him an unsolicited fax advertisement in
violation of the Telephone Consumer Protection Act.
Jordan Block filed his suit as a class action on behalf of all
others who received the advertising faxes as well.
For more details, contact Edelman, Combs, Latturner & Goodwin,
LLC, 18th Floor, 120 S. LaSalle, Chicago, Illinois 60603, Phone:
312-917-4504, Fax: 312-419-0379.
INTELLIGROUP INC: Continues to Face N.J. Securities Fraud Suit
--------------------------------------------------------------
The U.S. District Court for the District of New Jersey has yet
to set a trial date for the consolidated securities fraud class
action against Intelligroup, Inc. No discovery has taken place
either.
On or about October 12, 2004, the first of six class actions was
filed on behalf of a purported class of investors who purchased
the company's common stock, against the company and former
officers Arjun Valluripalli, Nicholas Visco, Edward Carr and
David Distel in the U.S. District Court, District of New Jersey.
In August 2005, the court consolidated the six class actions and
appointed a lead plaintiff. Plaintiffs subsequently dropped Mr.
Distel and Mr. Carr from the shareholder class action, failing
to name either of them as a defendant in the amended
consolidated complaint filed on or about Oct. 10, 2005.
The shareholder class action generally alleges violations of
federal securities laws, including allegations that the
Defendants made materially false and misleading statements
regarding the company's financial condition and that the
Defendants materially overstated financial results by engaging
in improper accounting practices.
The class period proposed was May 1, 2001 through Sept. 24,
2004. The shareholder class action generally seeks relief in
the form of unspecified compensatory damages and reasonable
costs, expenses and legal fees.
On Dec. 5, 2005, defendants filed motions to dismiss the amended
consolidated complaint. On Feb. 10, 2006, prior to the hearing
on defendants' motions to dismiss, plaintiffs filed a second
amended consolidated complaint.
Defendants' motions to dismiss the second amended consolidated
complaint, which was filed around March 27, 2006, are currently
pending before the court. No trial date has been scheduled and
no discovery has taken place.
The suit is "Lydia Garcia, et al. v. Intelligroup Inc., et al.,
Case No. 04-CV-4980," filed in the U.S. District Court for the
District of New Jersey under Judge John C. Lifland with referral
to Judge Mark Falk.
Representing the plaintiffs are:
(1) Joseph J. DePalma of Lite, DePalma, Greenberg & Rivas,
LLC, Two Gateway Center, 12th Floor, Newark, NJ 07102-
5003, Phone: (973) 623-3000, E-mail:
jdepalma@ldgrlaw.com;
(2) Gary S. Graifman of Kantrowitz, Goldhamer & Graifman,
Esqs., 210 Summit Avenue, Montvale, NJ 07645, Phone:
(201) 391-7000, E-mail: ggraifman@kgglaw.com; and
(3) Lisa J. Rodriguez of Trujillo Rodriguez & Richards,
LLP, 8 Kings Highway West, Haddonfield, NJ 08033,
Phone: (856) 795-9002, E-mail: lisa@trrlaw.com.
Representing the defendants are Dennis J. Drasco and Kevin J.
O'Connor of Lum, Danzis, Drasco & Positan, LLC, 103 Eisenhower
Parkway, Roseland, NJ 07068-1049, Phone: (973) 403-9000, E-mail:
ddrasco@lumlaw.com and koconnor@lumlaw.com.
INTERLINK ELECTRONICS: Still Faces Securities Suit in Calif.
------------------------------------------------------------
Interlink Electronics, Inc. remains a defendant in a purported
securities fraud class action, "Roger Brooks, et al. v.
Interlink Electronics, Inc., et al., Case No. 2:05-cv-08133-PA-
SH," filed in the U.S. District Court for the Central District
of California.
Filed on Nov. 15, 2005, the suit was brought against the company
and two of its current and former officers. It alleges that
between April 24, 2003 and Nov. 1, 2005, the company and two of
its current and former officers made false and misleading
statements and failed to disclose material information regarding
the company's results of operations and financial condition.
The complaint also alleges violations of federal securities
laws, Sections 10(b) and 20(a) of the U.S. Securities Exchange
Act of 1934 and Rule 10b-5, including allegations of issuing a
series of material misrepresentations to the market which had
the effect of artificially inflating the market price.
To date, the court has not certified a class, and the litigation
remains in its early stages, according to the company's July 24,
2006 Form 10-k filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2005.
The suit is "Roger Brooks, et al. v. Interlink Electronics,
Inc., et al., Case No. 2:05-cv-08133-PA-SH," filed in the U.S.
District Court for the Central District of California under
Judge Percy Anderson with referral to Judge Stephen J. Hillman.
Representing the plaintiffs are:
(1) Timothy J. Burke of Stull Stull and Brody, 10940
Wilshire Boulevard, Suite 2300, Los Angeles, CA 90024,
Phone: 310-209-2468, E-mail: service@ssbla.com;
(2) Lionel Z. Glancy of Glancy Binkow and Goldberg, 1801
Avenue of the Stars, Suite 311, Los Angeles, CA 90067,
Phone: 310-201-9150; and
(3) Roy L. Jacobs of Roy L. Jacobs and Associates, 60 East
42nd Street, 46th Floor, New York, NY 10165, Phone:
212-867-1156.
Representing the defendants is Daniel S. Floyd of Gibson Dunn &
Crutcher, 333 S. Grand Ave., 45th Fl., Los Angeles, CA 90071-
3197, Phone: 213-229-7000, E-mail: dfloyd@gibsondunn.com.
KENTUCKY: Resident Sues City, Sanitation District for Sewer Fees
----------------------------------------------------------------
The City of Independence, Kentucky and Sanitation District No.1
faces a purported class action in Kenton County Circuit Court
that seeks the return of about $1.7 million in sewer maintenance
fees to residents who paid them, The Kentucky Post reports.
Bill Cobbles, husband of city councilwoman JoAnne Cobbles, filed
the suit on July 25. He is seeking class-action status for the
case to represent all city residents.
The lawsuit was in response to Independence City Council's
decision that turned over the money to Sanitation District No. 1
in exchange for the district assuming ownership of the Fowler
Creek sewer system.
Mr. Cobbles argues the city does not have the authority to give
people's money away that was collected illegally. In his suit,
he alleges that Independence collected roughly $1.7 million from
city residents from 1999 through 2005 for sewer maintenance,
even though the Sanitation District No. 1 was responsible for
that work.
He also argues that the fee, which had been collected since the
1970s, should have expired when the Sanitation District assumed
responsibility for the city's sewer system in 1999. He points
out that the council voted last year to stop charging the fee
but did not return to residents the money it generated.
For more details, contact Independence Mayor Chris Moriconi,
Phone: (859) 363-2940.
KOREA: Yeongdeungpo-gu Residents File Suit Over Flood Damage
------------------------------------------------------------
The city of Seoul, Korea, Samsung Corp., and Daelim Industrial
Co., were named defendants in a class action filed by more than
300 residents in flood-hit Yeongdeungpo-gu in southwestern
Seoul, The Korea Herald reports.
The residents alleged that the recent flooding was to be blamed
on the defendants' carelessness. They are seeking remuneration
of at least KRW10 million ($10,469.196) to each plaintiff.
On July 16, heavy seasonal rains broke part of the Anyang Stream
embankment in Yangpyeong-dong, submerging over 1,900 low-lying
houses and apartments and forcing more than 900 residents to
evacuate, according to the report. The embankment was once
severed due to construction of a nearby subway station and then
restored.
MCI COMMUNICATIONS: Sept. Hearing Set for D.C. Stock Suit Deal
--------------------------------------------------------------
The U.S. District Court for the District of Columbia will hold a
fairness hearing on Sept. 1, 2006 at 10 a.m. for the proposed
$4.5 million settlement in the matter, "In re: MCI
Communications Corp. Securities Litigation, Case No. 97-CV-1976
(RWR)."
The hearing will be held in Courtroom 9 of the U.S. District
Court for the District of Columbia, 333 Constitution Ave., N.W.,
Washington, D.C.
Any objection to the settlement, plan of distribution, or award
of attorney fees and reimbursement of expenses must be mailed or
delivered by Aug. 1, 2006.
The case was brought on behalf of all persons who purchased MCI
common stock between July 11, 1997 and Aug. 21, 1997.
Case Background
On Aug. 28, 1997, a class action was filed in the U.S. District
Court for the District of Columbia, on behalf of persons who
purchased the common stock of MCI Communications Corp. between
July 11, 1997 and Aug. 21, 1997, against defendants MCI, and
certain of its officers and directors, including Gerald H.
Taylor, Timothy F. Price, Douglas L. Maine, Jr. Bert C. Roberts,
and David M. Case. The suit alleges violations under Sections
10(b) and 20(a) of the U.S. Securities and Exchange Act of 1934,
15 U.S.C. Section 78(j)(b) and 78(t), and Rule 10b-5 promulgated
thereunder by the U.S. Securities and Exchange Commission, 17
C.F.R. 240.10b-5.
The complaint alleges that MCI and BT Telecommunications PLC
entered into a merger agreement in November 1996 whereby BT
would acquire all of the outstanding shares of MCI in exchange
for cash and stock valued at approximately $24 billion. The
Merger faced serious regulatory hurdles from the start that had
to be cleared before the Merger could be consummated. During
the time these approvals were being sought, MCI surprised the
investment community and, apparently, BT when it announced in
July 1997, that it would suffer an $800 million loss for the
year.
Unbeknownst to the public, BT and MCI thereafter began
renegotiating the terms of the Merger as BT and its stockholders
now felt they were overpaying for MCI. MCI kept silent,
however, regarding the negotiations, even saying at one point
during July that the deal was going "straight ahead." On Aug.
14, 1997, in the company's Form 10-Q Report for the quarter
ended June 30, 1997, defendants are accused of brazenly, and
misleadingly, announcing that the merger was set to close in the
fall of 1997. Defendants never mentioned the renegotiations
with BT.
One week later, on Aug. 21, 1997, MCI was forced to acknowledge
that the merger had been renegotiated, and shortly thereafter it
announced that its shareholders would receive 22% less than
under the merger agreement as originally structured. The price
of MCI stock plummeted on this announcement. Plaintiffs and the
class lost tens of millions of dollars as a result.
Additional cases were filed on behalf of investors. On Oct. 31,
1997, motions were made to consolidate the various actions and
appoint lead plaintiff and lead counsel. On March 18, 1998, the
court consolidated the cases under the caption, "In re MCI
Communications Corp. Securities Litigation, No. 97-CV-1976," and
appointed Wolf Haldenstein Adler Freeman & Herz, LLP, co-lead
counsel. On May 8, 1998, plaintiffs filed a consolidated and
amended class action complaint. On July 13, 1998, defendants
filed a motion to dismiss, which was denied pursuant to an Order
entered on May 8, 2002.
On July 31, 2002, lead plaintiffs moved for certification of the
class consisting of all persons who purchased or acquired common
stock of MCI between July 11, 1997, and Aug. 21, 1997, and who
were damaged thereby, and appointing the plaintiff class
representatives as representatives of the class. On Feb. 12,
2003, that motion was granted in full with respect to the
individual defendants. The class certification did not extend
to MCI, as the claims against MCI were stayed as a result of
MCI's bankruptcy proceedings.
On Oct. 27, 2003, the court ordered that this case was stayed
pending resolution of MCI's bankruptcy proceedings, or until
such time as MCI provided discovery to plaintiffs. Pursuant to
that order, the case was administratively closed.
MCI emerged from bankruptcy in April 2004. A motion to re-open
discovery was never brought by plaintiffs because the individual
defendants and lead plaintiffs were already engaged in
settlement discussions. On March 11, 2005, the parties agreed
to the principle terms of the Settlement set forth in the
Stipulation. On Dec. 29, 2005, plaintiffs voluntarily dismissed
their claims against MCI.
For more details, contact:
(1) Jeffrey G. Smith of Wolf, Haldenstein, Adler, Freeman &
Herz, 270 Madison Avenue, New York, NY 10016, Phone:
(212) 545-4600; Web site:
http://www.whafh.com/modules/case/?action=view&id=775.
(2) Ilana Kohn of Abbey Gardy, L.L.P., 212 East 39th
Street, New York, NY 10016, Phone: (212) 889-3700, Fax:
212-684-5191;
(3) Herbert Esar Milstein of Cohen, Milstein, Hausfeld &
Toll, P.L.L.C., 1100 New York Avenue, NW, Suite 500
West Tower, Washington, DC 20005-3934, Phone: (202)
208-4600, Fax: (202) 208-4699, E-mail:
hmilstein@cmht.com; and
(4) Joseph Alexander Ward of Jenner & Block, 601 13th
Street, NW Suite 1200, Washington, DC 20005, Phone:
(202) 639-6000, E-mail: award@jenner.com.
MEDICAL SAVINGS: Faces Suit in Fla. Over Insurance Policy Add-On
----------------------------------------------------------------
Medical Savings Insurance Co. faces a class action in Florida
over an "obscure arrangement" with Freedom Works, a conservative
grass-roots political organization formerly known as Citizens
for a Sound Economy (CSE), according to The Washington Post.
The arrangement in question is about Medical Savings
policyholders' names being rented out as CSE members. The
arrangement was uncovered in a series of letters between CSE and
Medical Savings officials.
Buyers of the insurance policies claim that they were enrolled
in the political organization unknowingly when they agreed to
purchase a health insurance plan from Medical Savings.
Jeffrey M. Liggio, a lead lawyer in the case, noted that the
insurance policies themselves never mention FreedomWorks or
Citizens for a Sound Economy. It only labels the group
policyholder simply by a number: 1214.
According to the suit's motion for class certification, which
was granted in December, "The certificates of insurance issued
to class members, despite the clear language contained therein,
did not disclose the identity of the Group Policyholder of the
group policy, despite the fact that each putative insured must
'join' and pay money to such group as a condition of obtaining
the insurance."
Louis Silber, another attorney involved in the class action,
said that it was clearly concluded that the policyholders had no
idea what Citizens for a Sound Economy was.
Documents produced through the suit against Medical Savings show
how FreedomWorks joined the insurance business by making the
"obscure arrangement." Under the deal, proposed by Medical
Savings in 2000, its brokers will sell high-deductible insurance
policies and tax-free savings plans at a group discount to
buyers who join the conservative political organization.
Republican businessman J. Patrick Rooney heads Medical Savings.
Freedom Works, a political group that made its name fighting for
a flat income tax and questioning global warming, is headed by
former House majority leader Richard Armey, R-Texas.
Critics call the actions as a way to "inflate" the group's
membership numbers and its "bottom line." They point out that
over a span of five and a half years, the group gathered
$638,040 in dues.
However, Freedom Works officials defended their actions, saying
the insurance sales are just another way for grassroots groups
to garner members and are no different from the activities of
such giants as the Association for the Advancement of Retired
Persons.
For more details, contact:
(1) Jeffrey M. Liggio of Liggio, Benrubi & Williams, PA,
Suite 3B, Barristers Building, 1615 Forum Place, West
Palm Beach, FL 33401-2320, Phone: (561) 616-3333 and
(877) 604-3100, Fax: (561) 616-3266, Web site:
http://www.liggiolaw.com;and
(2) Louis M. Silber of Silber Valente & Davis, 1806 Old
Okeechobee Road, West Palm Beach, Florida 33409, (Palm
Beach Co.), Phone: 561-615-6200, Fax: 561-615-6206, Web
site: http://www.silberandvalente.com.
MICROSOFT CORP: $1.1B Antitrust Settlement Ready for Allocation
---------------------------------------------------------------
Attorneys for California's businesses and consumers announced
that a $1.1 billion antitrust settlement with Microsoft Corp. is
now available for distribution after an eighteen-month appellate
court battle.
Beginning in August 2006, vouchers worth hundreds of millions of
dollars will be sent to Californians who previously made claims
for their share of the settlement. The vouchers can be redeemed
for cash anytime during the next four years as businesses and
consumers purchase computer hardware or software from a wide
variety of eligible products offered by any competitor in the
computer industry.
A unique feature of the settlement gave businesses and consumers
the option to donate two thirds of their settlement benefits to
California's public schools by simply declining to make a
settlement claim. Because of their generosity, vouchers worth
hundreds of millions of dollars also will be distributed to
California's public schools beginning in September.
Those vouchers will allow schools that serve a high percentage
of underprivileged students to purchase much needed computer
hardware, software, training and services.
Superior Court Judge Paul Alvarado approved the $1.1 billion
settlement in July 2004. Under the terms of the settlement,
consumers and businesses that purchased certain Microsoft
products both directly and indirectly between March 31, 1995,
and Dec. 31, 2002, could apply for a reimbursement voucher to
buy computer hardware and software and other technology from any
manufacturer (Class Action Reporter, July 12, 2006).
However, distribution of the settlement proceeds was held up by
the appeal of a single class member who declined to make a claim
for his share of the settlement but objected to the donation of
any portion of his unclaimed benefits to the public schools.
The California Court of Appeals and the California Supreme Court
rejected his appeal. Last week he failed to meet the deadline
for an appeal to the U.S. Supreme Court, which finally clears
the way for distribution of the settlement proceeds.
Eugene Crew and Richard Grossman, co-lead counsel for the
plaintiffs who filed the antitrust case against the company
expressed their satisfaction with the final result.
"We filed this case in 1999 because we saw an opportunity to use
our expertise in technology and antitrust law to obtain justice
for the millions of California consumers and businesses that
were overcharged for their software as a result of Microsoft's
illegal monopoly," said Mr. Grossman. "We are delighted that our
seven year-legal battle is finally paying off for California's
businesses, consumers and schools."
Mr. Crew added, "I have devoted my entire career to the
enforcement of our nation's antitrust laws. This certainly is a
great day for antitrust enforcement in the State of California."
Both lawyers are partners in the San Francisco office of
Townsend and Townsend and Crew, which was appointed by the
California Superior Court to oversee the antitrust class action
against Microsoft on behalf of the California's businesses and
consumers.
They recently settled another case against Microsoft on behalf
of California's state and local government entities for $70
million.
Previously, the software giant was accused in an antitrust
lawsuit of violating the state's consumer fraud act. A Windham
Superior Court judge later approved a motion to make that case a
class action (Class ACtion Reporter, July 12, 2006).
Back in 2000, the company faced numerous lawsuits for using its
market power to force customers to pay higher prices for its
Windows operating system. These suits 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.
Based in Washington, Microsoft Corp. -- http://www.microsoft.com
-- provides a variety of products and services, including its
Windows operating systems and Office software suite. The
company has expanded into markets such as video game consoles,
interactive television, and Internet access.
For more information, contact Richard L. Grossman, Brian
Colucci, Eugene R. Crew, and James G. Gilliland all of Townsend
and Townsend and Crew LLP, Phone: +1-415-273-7580 or +1-415-273-
4769 or +1-415-273-7520 or +1-415-273-7560, Mobile: +1-510-853-
2337 or +1-650-766-8861, E-mail: rlg@townsend.com,
bccolucci@townsend.com, ecrew@townsend.com or jgg@townsend.com.
MICROSOFT CORP: Calif. Schools to Receive $600M from Settlement
---------------------------------------------------------------
A member of an antitrust class action against Microsoft Corp.
who declined to make a claim for his share but objected to the
donation of any portion of his unclaimed benefits to public
schools, failed to meet a third appeals deadline last week,
according to CBS5.
The class action member's appeal was rejected by the California
Court of Appeals and the California Supreme Court. He is
supposed to appeal to the U.S. Supreme Court, but failed to meet
the deadline.
The failure frees up proceeds of a settlement for distribution
to public schools. Recently, State Superintendent of Public
Instruction Jack O'Connell said up to $600 million from a $1.1
billion antitrust class action settlement against Microsoft
could be made available to public schools serving disadvantaged
students.
Richard Grossman of Townsend and Crew, the law firm representing
the plaintiffs notes that under an agreement with Microsoft two
years ago, two-thirds of the proceeds not claimed by California
consumers and businesses would benefit public schools. The
remainder of the unclaimed funds is to go back to Microsoft.
The amount that each school district will receive will be known
after all consumer and business complaints are processed and the
school districts apply, according to the report.
The $1.1 billion settlement was approved by Superior Court Judge
Paul Alvarado in July 2004.
Beginning in August 2006, vouchers worth hundreds of millions of
dollars will be sent to Californians who previously made claims
for their share of the settlement. The vouchers can be redeemed
for cash anytime during the next four years as businesses and
consumers purchase computer hardware or software from a wide
variety of eligible products offered by any competitor in the
computer industry.
For more information, contact Richard L. Grossman of Townsend
and Townsend and Crew, LLP, Phone: +1-415-273-7580, E-mail:
rlg@townsend.com; or Brian C. Colucci, Director of Marketing,
Phone: +1-415-273-4769, E-mail: bccolucci@townsend.com.
NPS PHARMACEUTICALS: Facing Securities Fraud Lawsuit in Utah
------------------------------------------------------------
NPS Pharmaceuticals, Inc. is facing a class action in the U.S.
District Court for the District of Utah over alleged violations
of the U.S. Securities Exchange Act of 1934.
Plaintiff, Richard Baird, filed the suit on behalf of all
securities purchasers of NPS Pharmaceuticals from Aug. 10, 2005
to May 2, 2006.
The suit alleges that NPS and certain of its officers and
directors failed to disclose and misrepresented these material
adverse facts, which were known to defendants or recklessly
disregarded by them:
-- that the PaTH study, released on Aug. 10, 2005 and
touted by the company, did not show that PREOS was
superior to Fosamax in treating postmenopausal
osteoporotic women;
-- that problems existed regarding the risks associated
with PREOS;
-- that patients taking PREOS were at risk of developing
hypercalcemia;
-- that the injection device used to deliver PREOS to the
patient was unreliable;
-- that such issues, as described above, would result in a
significant delay in PREOS' approval because further
clinical trials would be needed to gain U.S.
Food and Drug Administration approval; and
-- that, as a result of the above, the company's
statements concerning PREOS and its sales figures were
lacking in any reasonable basis when made.
On May 2, 2006, after the market closed, NPS announced the
results of the company's meeting with officials from the FDA
regarding the FDA's March 2006 approvable letter concerning the
company's parathyroid hormone PREOS.
NPS reported that the FDA had proposed that NPS generate
additional clinical data in the form of a new clinical trial in
order to address the hypercalcemia issue raised in the March
approvable letter.
A copy of the complaint is available free of charge at:
http://ResearchArchives.com/t/s?e76
The suit is "Baird v. NPS Pharmaceutical et al., Case No. 2:06-
cv-00597-TS," filed in the U.S. District Court for the District
of Utah under Judge Ted Stewart.
Representing the plaintiffs are A. John Pate and Gary D. E.
Pierce both of Pate Pierce & Baird, 215 S State St., Ste 550,
Parkside Tower, Salt Lake City, UT 84111, Phone: (801) 530-0330,
E-mail: pate@patepiercebaird.com or pierce@patepiercebaird.com.
PARLUX FRAGRANCES: Faces Fla. Shareholder's Suit Over PFA Offer
---------------------------------------------------------------
Parlux Fragrances, Inc. is a defendant in a purported
shareholder's class action filed in the Circuit Court of the
Seventeenth Judicial Circuit in and for Broward County, Florida
over the proposal by PF Acquisition of Florida LLC to acquire
all of the outstanding common stock of the company.
On June 14, 2006, the company's Board of Directors received an
unsolicited letter from company chairman and chief executive,
Mr. Ilia Lekach, representing PFA, pertaining to the possible
acquisition of all of the outstanding common stock of the
company at a proposed price of $29.00 ($14.50 after the Stock
Split) per share in cash, representing a premium of 55% over the
closing price of the company's common stock on June 13, 2006.
The proposal was subject to financial and other contingencies,
and was referred to the Special Committee of Independent
Directors of the Parlux Board of Directors.
On June 21, 2006, the company was served with a shareholder's
class action complaint that was filed by Glen Hutton, purporting
to act on behalf of other public stockholders of the company.
The class action names the company as a defendant, along with
company directors Ilia Lekach, Frank A. Buttacavoli, Glenn
Gopman, Esther Egozi Choukroun, David Stone, Jaya Kader Zebede
and Isaac Lekach.
The suit seeks equitable relief for inadequate and unfair
consideration, without full disclosure of all material
information, to the detriment of the public shareholders, all in
breach of defendants' fiduciary duties.
It alleges that the proposal is solely designed to ensure that
the company's management completes it despite the fact that the
consideration called for in the proposal is unfair to the public
shareholders and the company's public shareholders have not been
provided with all material information concerning it, which is
necessary for them to make an informed decision.
On July 12, 2006, the Committee received a letter from PFA
stating that, due to corporate developments occurring with
respect to the potential acquisition of certain of the company's
brands, Mr. Lekach was withdrawing the proposal.
Parlux Fragrances, Inc. is a manufacturer and international
distributor of prestige products. It holds licenses for Paris
Hilton fragrances, watches, cosmetics, sunglasses, handbags and
other small leather accessories in addition to licenses to
manufacture and distribute the designer fragrance brands of
Perry Ellis, GUESS?, XOXO, Ocean Pacific (OP), Maria Sharapova,
Andy Roddick, babyGund and Fred Hayman Beverly Hills.
For more information, contact Frank A. Buttacavoli of Parlux
Fragrances, Inc., Phone: +1-954-316-9008, ext. 8117.
PUTNAM FUND: High Court Remands Ruling in Securities Fraud Suit
---------------------------------------------------------------
The U.S. Supreme Court vacated and remanded the Seventh U.S.
Circuit Court of Appeals' decision to review the federal
district court's remand of a securities fraud class action
against Putnam Fund Trust to state court, according to the
Securities Class Action Clearinghouse.
Putnam Fund is facing lawsuits filed by eight investors alleging
fraud in relation to their mutual fund holdings. It has
succeeded in removing all the cases to federal district court
pursuant to the Securities Litigation Uniform Standards Act of
1998, but the district court remanded the cases to state court.
In remanding the suits, the district court said that action
could not be brought under the Act because investors are not
buyers or sellers of the mutual funds, but "holders." Besides,
the funds were not covered under the Act.
The Seventh Circuit reversed the district court's order after
finding that indeed the funds were covered under the Act.
Recently, however, the Supreme Court granted certiorari, vacated
and remanded the Seventh Circuit's decision. It said that
Section 1447(d) of the Labor Code bars review of district court
orders remanding removed cases for lack of subject matter
jurisdiction.
The suit is "Kircher v. Putnam Funds Trust," No. 05-409.
ROYAL OASIS: Timeshare Owners File Suit in Fla. Over Closure
------------------------------------------------------------
Sunrise Properties Limited, Driftwood Freeport Limited and
Driftwood Hospitality Management, LLC were named as defendants
in a purported federal class action filed in Florida by
timeshare owners of now defunct Royal Oasis resort in the
Bahamas, The Freeport News reports.
The suit, which was at least six months in the making, alleges
four counts, including breach of contract, breach of the implied
duty of good faith and fair dealing, unjust enrichment and for a
declaration of the class' ownership rights and interests in
their timeshare units.
The 13-page complaint states that the timeshare owners were
excommunicated from the resort since November 2004. It also
states that they are dejected over inquiries they made with the
resort that went unanswered.
Several months ago, the Crowne Plaza Golf Resort and Casino at
the Royal Oasis closed down, reportedly for much-needed repairs
after Hurricane Frances in September 2004. The closure forced
the lay-off of some 1,300 employees and subsequently the time-
share arm (Class Action Reporter, Jan. 11, 2006).
In a November 4, 2004 letter, timeshare owners learned that the
resort had anticipated re-opening the vacation club on June 1,
2005; however, it never happened.
With no news from the timeshare resort for several months
regarding a pending sale or reopening of the resort, and
virtually stuck with a time-share point system that is useless
to them, several owners threatened the resort with legal action,
the one that was recently filed.
The Royal Oasis property includes a casino, country club and
tower and is the second largest resort on the island. With its
closure, the Bahamas Government is seeking out a buyer for the
defunct resort, which there were two.
In an interview with The Freeport News, plaintiffs' attorney
Carlin Phillips, of Phillips and Garcia, P.C. in Massachusetts,
said that with the sale in limbo, they believe the timeshare
owners have at least a leasehold interest and maybe even some
kind of property interest in the timeshare units.
He pointed out that most owners who paid cash in advance for
their timeshare lost a significant amount of money with
contracts bought up for years.
Mr. Phillips explains that they are trying to assert the owners'
rights for the money they have lost in the past and what they
will lose in the future, because if the resort is not going to
be developed, the owners are losing yearly.
In pointing out the defendants never repaired or reopened the
resort, the suit revealed that timeshare owners have not been
notified about the status of their units and their rights. It
adds that plaintiffs were given no assurance that their
timeshare interests would be protected if the property were
sold.
According to the suit, a contract clause reveals that the
membership agreement states that should the resort be delayed
from performing any obligations by reason or as a result of any
peril and in the event the timeshare owner is unable to use his
unit as a result of damage to the unit, the resort at its
discretion will provide:
-- an alternate accommodation; or
-- refund one-21st of the price paid by the timeshare
owner for each unit week the timeshare owner is unable
to use it as a result of damage from an insured peril.
For more details, contact Carlin J. Phillips, Esq. of Phillips &
Garcia, LLP, 13 Ventura Drive, North Dartmouth, MA 02747, Phone
(toll free): 1-877-892-5620, Ext. 112 and 508-998-0800, Ext.
112, Fax: 508-998-0919, E-mail: cphillips@phillipsgarcia.com,
Web site: http://www.phillipsgarcia.com/.
SEARS CANADA: Lawsuits Over Tire Pricing, Sears Card Continue
-------------------------------------------------------------
Sears Canada Inc. continues to face three class actions in the
provinces of Quebec, Saskatchewan and Ontario over its tire
pricing, according to the company's second-quarter earnings
report.
In 2000, a class action with respect to the Sears Card was filed
against the company pursuant to Quebec law. The company was
named in a Quebec class action relating to the required 21-day
grace period for credit cardholders to pay their obligations
without attracting credit charges.
In 2006, Sears Canada reported that the parties in the suit
reached a settlement for the case, which was approved by the
court in early April 2005 without admission of any kind by the
defendants (Class Action Reporter, Feb. 7, 2006).
The settlement, the company states, required it to repay
interest and lost opportunity costs to cardholders in Quebec in
a total amount, which was not material to the company's
financial statements.
Sears Canada -- http://www.sears.ca-- is a multi-channel
retailer with a network of 188 corporate stores, 181 dealer
stores, 66 home improvement showrooms, over 2,100 catalogue
merchandise pick-up locations, 107 Sears Travel offices and a
nationwide home maintenance, repair, and installation network.
The Company also publishes Canada's most extensive general
merchandise catalogue and offers shopping online.
SILICON LABORATORIES: IPO Suit Settlement Yet to Obtain Court OK
----------------------------------------------------------------
The U.S. District Court for the Southern District of New York
has yet to issue an order with respect to the final approval of
the settlement of a consolidated securities class action against
Silicon Laboratories, Inc., according to the company's July 24,
2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended July 1, 2006.
On Dec. 6, 2001, a class action complaint for violations of U.S.
federal securities laws was filed in the U.S. District Court for
the Southern District of New York against the company, four
officers individually and the three investment banking firms who
served as representatives of the underwriters in connection with
the company's initial public offering of common stock.
A consolidated amended complaint alleges that the registration
statement and prospectus for the company's initial public
offering did not disclose that:
-- the underwriters solicited and received additional,
excessive and undisclosed commissions from certain
investors; and
-- the underwriters had agreed to allocate shares of the
offering in exchange for a commitment from the
customers to purchase additional shares in the
aftermarket at pre-determined higher prices.
The action seeks damages in an unspecified amount and is being
coordinated with approximately 300 other nearly identical
actions filed against other companies. A court order dated Oct.
9, 2002 dismissed without prejudice the four officers of the
company who had been named individually.
On Feb. 19, 2003, the court denied the motion to dismiss the
complaint against the company. On Oct. 13, 2004, the court
certified a class in six of the approximately 300 other nearly
identical actions and noted that the decision is intended to
provide strong guidance to all parties regarding class
certification in the remaining cases.
Plaintiffs have not yet moved to certify a class in the Silicon
Laboratories case. The underwriter defendants have appealed the
class certification decision and the Second Circuit has accepted
the appeal.
The company has approved a settlement agreement and related
agreements, which set forth the terms of a settlement between
the company, the plaintiff class and the vast majority of the
other approximately 300-issuer defendants.
Among other provisions, the settlement provides for a release of
the company and the individual defendants for the conduct
alleged in the action to be wrongful.
The company would agree to undertake certain responsibilities,
including agreeing to assign away, not assert, or release
certain potential claims the company may have against its
underwriters.
The settlement agreement also provides a guaranteed recovery of
$1 billion to plaintiffs for the cases relating to all of the
approximately 300 issuers.
To the extent that the underwriter defendants settle all of the
cases for at least $1 billion, no payment will be required under
the issuers' settlement agreement.
To the extent that the underwriter defendants settle for less
than $1 billion, the issuers are required to make up the
difference.
The company anticipates that its potential financial obligation
to plaintiffs pursuant to the terms of the settlement agreement
and related agreements will be covered by existing insurance.
On Feb. 15, 2005, the court granted preliminary approval of the
settlement agreement, subject to certain modifications
consistent with its opinion. Those modifications have been
made.
On March 20, 2006, the underwriter defendants submitted
objections to the settlement to the court. The court held a
hearing regarding these and other objections to the settlement
at a fairness hearing on April 24, 2006, but has not issued a
ruling yet. There is no assurance that the court will grant
final approval to the settlement.
For more details, visit http://www.iposecuritieslitigation.com/.
STORA ENSO: Files Response to Paper Price Manipulation Lawsuit
--------------------------------------------------------------
Finnish firm Stora Enso Corp. said it has investigated
allegations of antitrust violations filed against it, and given
its response to a class action by a June 22 deadline.
Stora Enso was named in a number of class actions filed in the
U.S. coincident with European investigations into the paper
industry in U.S. and Europe.
In May 2004 Stora Enso was the subject of inspections carried
out by the European Commission and the Finnish Competition
Authority at locations in Europe. It received subpoenas issued
by the U.S. Department of Justice as part of preliminary anti-
trust investigations into the paper industry in Europe and the
U.S.
Following the 2004 inspections, on April 5, 2006 Stora Enso
received from the Finnish Competition Authority a request for a
response concerning alleged price collaboration and exchange of
information between forest companies in connection with the
purchasing of timber in Finland from 1997 to 2004.
Stora Enso -- http://www.storaenso.com-- manufactures and
distributes paper and board products worldwide. It operates in
six segments: Publication Paper, Fine Paper, Merchants,
Packaging Boards, Wood Products, and Wood Supply.
SUPER STEEL: Increases Reward to Find Author of Racist Message
--------------------------------------------------------------
Train car maker Super Steel Schenectady Inc. has upped the
reward for anyone who can offer information to help police find
out who left a racist message in an employee's locker in
January.
In an advertisement in Schenectady newspaper Daily Gazette, the
Scotia, New York-based company has increased the reward by
$25,000 to $2,500, according to The Business Review.
The incident in January led to a $173 million class action
against the company four months after. Nine current and former
African-American employees of Super Steel Schenectady initiated
the suit against their employer in the U.S. District Court for
the Northern District of New York (Class Action Reporter, April
21, 2006).
Plaintiffs were Criss Murphy, Norman Jordan, Andino
Ward, Eddie Barnes, Jr., Paul Hannon, Curtis Nelson, David
Chambers, Herion Murphy and Vincent Safford and a class of
current and former African American employees of the company.
They are represented by David Sanford of Sanford, Wittels &
Heisler, LLP. They are seeking:
-- certification of their case as a class action under
federal statutes;
-- their designation as representatives of the class and
Mr. Sanford as counsel of record for the class;
-- declaratory judgments that Super Steel's employment
practices are illegal and in violation of the Civil
Rights Acts of 1866; and
-- temporary and permanent injunctions against Super Steel,
which would bar Super Steel from engaging in further
unlawful practices, policies and customs.
In addition, the plaintiffs are also requesting an order
requiring the company to implement programs that effectively
remedy the hostile work environment and eliminate the
discriminatory and retaliatory practices currently in use; an
order establishing a workplace task force on equality and
fairness to monitor conditions at the Company; and damages,
including not less than $25 million dollars in compensatory
damages, not less than $150 million dollars in punitive damages,
and nominal damages. The plaintiffs have demanded a jury trial
in the matter.
The suit is "Murphy, et al. v. Super Steel Schenectady, Inc.,
Case No. 1:06-cv-00480-GLS-DRH," filed in the U.S. District for
the Northern District of New York under Judge Gary L. Sharpe
with referral to Judge David R. Homer. Representing the
plaintiffs is Steven L. Wittels of Sanford, Wittels Law Firm, 18
Half Mile Road, Armonk, NY 10504, US, Phone: 914-273-7314, Fax:
914-273-7314, E-mail: classaxe@optonline.net.
TENNESSEE: Lawyers Want Out of East High School Black Mold Suit
---------------------------------------------------------------
Attorneys behind a 2001 class action over black mold at East
High School in Memphis City, Tennessee are seeking to be removed
from the case, according to WMC-TV.
Five years after the discovery and cleanup of the black mold at
East High School, 15 Memphis City School parents and students
got a letter from attorneys asking the courts that they taken
out of the case.
Named in the suit are the school and its former cleanup company
Aramark-ServiceMaster. Plaintiffs are claiming that mold in the
school caused health problems to some parents and students.
Memphis City Schools Attorney, Mike S. Marshall, said plaintiffs
have until October to make their case and if they can't prove
their case or bring forth evidence to show that there's reason
to go forward, then the suit is going to be dismissed.
Attorneys asking to be removed from the case say the parents
have a good case, but they don't have the money to prove the
case.
However, according to former PTA president Zorina Bowen, one of
the leaders behind the case back in 2001, she believes that the
attorneys took the case under false pretenses, since they led
her and others to believe that they (attorneys) had the
resources to fight it, but later find out that they actually
don't.
For more details, contact Michael R. Marshall, Evans & Petree,
PC, 1000 Ridgeway Loop Road, Suite 200, Memphis, Tennessee
38120, (Shelby Co.), Phone: 901-525-6781, Fax: 901-521-0681, E-
mail: mmarshall@evanspetree.com, Web site:
http://www.evanspetree.com.
WEST CORP: Shareholder Files Lawsuit in Nebr. Over $4.1B Sale
-------------------------------------------------------------
West Corp. (NASDAQ: WSTC) faces a purported shareholder class
action in Douglas County District Court in Nebraska that seek to
stop the planned sale of the publicly traded company to two
private investment firms, The Omaha World-Herald reports.
The company plans to sell itself in a $4.1 billion deal to
Thomas H. Lee Partners of Boston and Quadrangle Group LLC of New
York.
Filed by Claude Lee of Reno, Nevada, the suit alleges that the
sale "is being advanced through unfair procedures" and that
founders Gary and Mary West, who hold 56 percent of the
company's stock, dictated "inequitable terms" to further their
financial interests and those of some people in the company
management.
The suit also alleges that "lucrative side agreements" were
made, which would deliver $12.5 million in bonuses to 14 company
managers.
Mr. Lee's suit also alleges that the $48.75 per share being
offered to all shareholders except the company founders was
below the premium typically paid in such deals, however it did
not say what the typical premium is. It also charges that
shareholders other than the founders would get no opportunity to
benefit from the company's expected growth.
Thus, Mr. Lee asks the court that the suit be declared a class
action on behalf of "hundreds" of shareholders other than the
defendants. He also asks the court that the deal be blocked or,
if it goes ahead, rescinded. The suit asks for compensatory
damages without specifying a dollar amount.
Besides the corporation, other defendants named in the suit
include Gary L. West, Mary E. West and Chief Executive Thomas
Barker, all of whom are board members, and the three other board
members, William Fisher, George Krauss and Greg Sloma.
Based in Omaha, Nebraska, West Corp. -- http://www.west.com/--
provides business process outsourcing services focused on
helping its clients communicate effectively with their
customers.
Asbestos Alert
ASBESTOS LITIGATION: Suits v. AB Electrolux Rise by 50 to 1,162
---------------------------------------------------------------
AB Electrolux, as of June 30, 2006, had a total of 1,162 pending
asbestos-related cases, representing about 8,050 plaintiffs.
As of March 31, 2006, the Company posted a total of 1,112
pending asbestos-related cases representing about 8,250
plaintiffs. About 6,870 of the plaintiffs related to cases
pending in Mississippi. (Class Action Reporter May 5, 2006)
In the 2006-2nd quarter, a total of 147 new cases with about 300
plaintiffs were filed and 97 pending cases with about 500
plaintiffs were resolved. About 6,470 of the plaintiffs related
to cases pending in Mississippi.
Most cases refer to externally supplied components used in
industrial products made by discontinued operations before the
early 1970s. Many of the cases involve multiple plaintiffs who
have made identical allegations against many other defendants
who are not part of the Electrolux Group.
Based in Stockholm, Sweden, AB Electrolux makes household
appliances like washing machines, stoves, refrigerators, and
freezers under the AEG, Electrolux, Eureka, Frigidaire, and
Zanussi names. The Company also makes vacuum cleaners, including
the Electrolux and Eureka brands.
ASBESTOS LITIGATION: Honeywell Posts $1.491B Liabilities at 2Q06
----------------------------------------------------------------
Honeywell International Inc.'s asbestos-related liabilities, as
of June 30, 2006, was US$1.491 billion compared with US$1.549
billion as of December 31, 2005, according to a Company press
release dated July 20, 2006.
As of June 30, 2006, the Company's insurance recoveries for
asbestos related liabilities was US$1.139 billion compared with
US$1.302 billion as of December 31, 2005.
For the three months ended June 30, 2006, the Company's asbestos
related liability payments was US$136 million compared with
US$188 million for the three months ended June 30, 2005.
For the six months ended June 30, 2006, the Company's asbestos
related liability payments was US$161 million compared with
US$280 million for the six months ended June 30, 2005.
The Company's insurance receipts for asbestos related
liabilities, for the three months ended June 30, 2006, was US$73
million compared with US$90 million for the three months ended
June 30, 2005.
The Company's insurance receipts for asbestos related
liabilities, for the six months ended June 30, 2006, was US$108
million compared with US$99 million for the six months ended
June 30, 2005.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: PPG Industries Inc. Has $280M Income in 2Q
---------------------------------------------------------------
PPG Industries Inc. reported record sales and earnings for any
quarter with second quarter net income of US$280 million, or
US$1.68 a share, according to a Company press release, dated
July 20, 2006, filed with the U.S. Securities and Exchange
Commission.
Net income includes after-tax earnings of US$12 million, or
US$0.07 a share, for net legal and insurance matters, and an
after-tax charge of US$4 million, or US$0.03 cents a share, to
reflect the net increase in the current value of the Company's
obligation under its asbestos settlement agreement reported in
May 2002.
Sales were US$2.82 billion, surpassing the old record set in the
2005-2nd quarter by six percent. That compares with 2005-2nd
quarter net income of US$231 million, or US$1.34 a share,
including after-tax charges of US$12 million, or US$0.07 a
share, for debt refinancing, and US$2 million, or US$0.01 a
share, to reflect the net increase in value of the asbestos
settlement agreement. Sales for the 2005-2nd quarter were
US$2.66 billion.
For the first six months of 2006, PPG recorded net income of
US$464 million, or US$2.79 a share, which includes after-tax
earnings of US$12 million, or US$0.07 a share, for net legal and
insurance matters; and after-tax charges of US$23 million, or
US$0.14 a share, for business restructuring; and US$10 million,
or US$0.06 a share, to reflect the net increase in the current
value of the Company's obligation under the asbestos settlement
agreement. Sales for the first half of 2006 were US$5.46
billion.
For the first six months of 2005, PPG recorded net income of
US$326 million, or US$1.89 a share, which included after-tax
charges of US$91 million, or US$0.52 cents a share, for a legal
settlement; US$12 million, or US$0.07 cents a share, for debt
refinancing; and US$7 million, or US$0.04 cents a share, to
reflect the net increase in the value of the Company's
obligation under the asbestos settlement agreement. Sales for
the first half of 2005 were US$5.15 billion.
Based in Pittsburgh, Pennsylvania, PPG Industries Inc. makes
coatings (paints and stains) and sealants. The Company also
makes glass and chemicals. PPG operates nearly 110 manufacturing
facilities in more than 20 countries worldwide. It also operates
more than 350 paint retail centers in the U.S.
ASBESTOS LITIGATION: PPG Ind.'s Settlement for Claims Hit $560M
----------------------------------------------------------------
PPG Industries Inc.'s current settlement for asbestos claims, as
of June 30, 2006, was US$560 million, compared with US$472
million as of December 31, 2005.
As of March 31, 2006, the Company's current liabilities for
asbestos settlement were US$480 million. (Class Action Reporter,
June 6, 2006)
As of June 30, 2006, the Company's non-current settlement for
asbestos claims was US$321 million, compared with US$385 million
as of December 31, 2005.
The Company's net asbestos settlement, for the three months
ended June 30, 2006, was US$8 million, compared with US$3
million for the three months ended June 30, 2005.
For the six months ended June 30, 2006, the Company's net
asbestos settlement was US$17 million, compared with US$12
million for the six months ended June 30, 2005.
Based in Pittsburgh, Pennsylvania, PPG Industries Inc. makes
coatings (paints and stains) and sealants. The Company also
makes glass and chemicals. PPG operates nearly 110 manufacturing
facilities in more than 20 countries worldwide. It also operates
more than 350 paint retail centers in the U.S.
ASBESTOS LITIGATION: Honeywell Int'l Has $49M Charges for Claims
----------------------------------------------------------------
Honeywell International Inc. recognized a charge of US$49
million for asbestos-related claims in the 2006-2nd quarter,
according to the Company's Quarterly Report for the period
ending June 30, 2006, on Form 10-Q, delivered to the U.S.
Securities and Exchange Commission.
The charges were mainly for subsidiary Bendix's asbestos claims
and defense costs incurred during the 2006-2nd quarter. The
charge included the net effect of the settlement of certain
North American Refractories Co. pending asbestos claims and a
Bendix insurance settlement.
The Company owned NARCO, which made refractory products, from
1979 to 1986.
For the six months ended June 30, 2006, the Company's asbestos-
related litigation charges, net of insurance, was US$77 million,
compared with US$14 million for the six months ended June 30,
2005.
The Company recognized a charge of US$28 million for Bendix
asbestos claims and defense costs incurred during the 2006-1st
quarter, net of probable insurance recoveries.
Honeywell recognized a net credit of US$20 million consisting of
a reduction in the Bendix net asbestos liability of US$70
million related to an update of expected resolution values
regarding claims pending as of June 30, 2005.
This net credit was partially offset by a charge of US$50
million for Bendix asbestos claims filed and defense costs
incurred during the 2005-2nd quarter, net of probable insurance
recoveries, and for the write-off of a Bendix related insurance
receivable.
In the 2005-1st quarter, the Company recognized a charge of
US$34 million, mainly for Bendix asbestos claims filed and
defense costs incurred during the 2005-1st quarter, net of
probable insurance recoveries.
The asbestos related charge also included the net effect of a
settlement of certain NARCO pending asbestos claims, a Bendix
related structured insurance settlement and write-offs of
certain Bendix related insurance receivables.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: Honeywell Estimates $1.7B for NARCO Claims
---------------------------------------------------------------
Honeywell International Inc. estimated its settlement liability
of pending and future North American Refractories Co. asbestos
claims to be US$1.7 billion, as of June 30, 2006.
The estimated liability for current claims was based on terms
and conditions in definitive agreements with about 260,000
current claimants. About US$90 million of payments due pursuant
to these settlements is due upon establishment of the NARCO
trust.
As of June 30, 2006, Honeywell's insurance receivable
corresponding to the liability for settlement of pending and
future NARCO-related asbestos claims was US$1 billion, compared
with US$1.1 billion as of December 31, 2005.
As of March 31, 2006 and December 31, 2005, the Company
estimated its pending and future NARCO asbestos-related
settlement liability at US$1.8 billion. (Class Action Reporter,
April 28, 2006)
Honeywell owned NARCO from 1979 to 1986. NARCO made refractory
products like high temperature bricks and cement, which were
sold to the steel industry in the East and Midwest. Less than 2
percent of NARCO's products had asbestos.
When Honeywell sold NARCO in 1986, Honeywell agreed to indemnify
NARCO regarding personal injury claims for products that had
been discontinued before the sale. NARCO retained all liability
for all other claims.
On Jan. 4, 2002, NARCO filed for reorganization under Chapter 11
of the U.S. Bankruptcy Code. All of the claims pending against
NARCO are automatically stayed pending NARCO's reorganization.
Moreover, the bankruptcy court enjoined both the filing and
prosecution of NARCO-related asbestos claims against Honeywell.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: Travelers Sues Honeywell Over NARCO Claims
---------------------------------------------------------------
Travelers Casualty and Insurance Co. sued Honeywell
International Inc. and other insurance carriers in the New York
Supreme Court, New York County, in the 2006-2nd quarter.
The Company sued over obligations for North American
Refractories Co. asbestos claims under high excess insurance
coverage issued by Travelers and other insurance carriers.
Honeywell owned NARCO, which made refractory products, from 1979
to 1986.
About US$370 million of coverage under these policies is
included in Honeywell's NARCO-related insurance receivable at
June 30, 2006.
Honeywell said it is entitled to the coverage at issue and has
accordingly filed counterclaims in the Superior Court of New
Jersey seeking declaratory relief.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: Honeywell Notes 72,174 Bendix Claims in 2Q
---------------------------------------------------------------
Honeywell International Inc.'s Bendix friction materials
business, for the six months ended June 30, 2006, had 72,174
asbestos-related claims compared with 79,502 claims for the six
months ended December 31, 2005.
Bendix made automotive brake pads that had chrysotile asbestos
in an encapsulated form.
For the six months ended June 30, 2006, the Company filed 1,963
Bendix asbestos claims compared with 7,520 claims for the six
months ended December 31, 2005.
For the six months ended June 30, 2006, the Company resolved
9,291 Bendix asbestos claims compared with 4,366 claims for the
six months ended December 31, 2005. The 4,366 claims excluded
2,524 claims, which were inadvertently included in resolved
claims as of December 31, 2005.
From 1981 through June 30, 2006, Honeywell had resolved about
87,000 Bendix related asbestos claims including trials covering
122 plaintiffs, which resulted in 116 favorable verdicts.
Trials covering six individuals resulted in adverse verdicts.
However, two verdicts were reversed on appeal, a third is on
appeal, and the remaining three claims were settled.
Of the 72,124 unresolved Bendix claims for the six months ended
June 30, 2006, the Company noted that 4,906 were mesothelioma
claims and 67,268 were other claims.
Of the 79,502 unresolved Bendix claims for the year ended
December 31, 2005, 4,810 were mesothelioma claims and 74,692
were other claims.
Honeywell currently has about US$1.9 billion of insurance
coverage remaining regarding pending and potential future Bendix
asbestos claims of which US$273 million was reflected as
receivables in Honeywell's consolidated balanced sheet at June
30, 2006, and US$377 million was reflected as receivables in
Honeywell's consolidated balance sheet at December 31, 2005.
About 30 percent of about 72,000 pending claims at June 30, 2006
are on the inactive, deferred, or similar dockets established in
some jurisdictions for claimants who allege minimal or no
impairment. The pending claims include claims filed in
jurisdictions like Texas, Virginia and Mississippi that
historically allowed for consolidated filings.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: Honeywell Has $2.011B Liability for Claims
---------------------------------------------------------------
Honeywell International Inc. had US$2.011 billion asbestos
related liabilities for the six-month period ending June 30,
2006, compared with US$2.069 billion for the six-month period
ending December 31, 2005.
Of the US$2.011 billion figure for liabilities, US$302 million
was for claims of Honeywell's Bendix friction materials business
and US$1.702 billion was for claims of its former subsidiary,
North American Refractories Co.
For the six months ended June 30, 2006, Honeywell's insurance
recoveries for asbestos related liabilities was US$1.293
billion, compared with US$1.473 billion for the six month period
ended December 31, 2005.
Of the US$1.293 billion, US$273 million was for Bendix claims
and US$1.020 billion was for NARCO claims.
Based in Morristown, New Jersey, Honeywell International Inc.'s
largest business segment, Honeywell Aerospace, makes products
like turbofan and turboprop engines and flight safety and
landing systems.
ASBESTOS LITIGATION: RPM International Posts $335M Charges in 4Q
----------------------------------------------------------------
RPM International Inc.'s asbestos charges totaled US$335 million
for the fourth quarter and fiscal year ended May 31, 2006,
including a long-term reserve of US$321 million and current
reserves of US$14 million, according to a Company press release
dated July 24, 2006.
The net loss for the period was US$142 million, or US$1.21 per
diluted share, compared with a net income of US$46.2 million, or
US$0.37 per diluted share in the fiscal 2005-4th quarter, which
included a US$16 million asbestos charge.
Excluding the asbestos charges, RPM's net income for the fourth
quarter grew 29 percent to a record US$73.6 million from US$57
million in the fiscal 2005-4th quarter, and diluted earnings per
share grew 26.1 percent, to a record US$0.58 from US$0.46 a year
ago.
For the 2006 fiscal year, net sales increased 17.7 percent to a
record US$3.01 billion from US$2.56 billion a year ago. The net
loss for the year, including asbestos charges, of US$76.2
million compared to net income of US$105 million a year ago,
including asbestos charges.
The fiscal 2006 net loss per diluted share was US$0.65, compared
to earnings per diluted share of US$0.86 in fiscal 2005. The
fiscal 2006 loss before interest and taxes of US$81.1 million
compared with Earnings Before Interest and Tax of US$199.1
million in fiscal 2005.
Excluding the asbestos charges, fiscal 2006 net income increased
8.8 percent to a record US$168.1 million from US$154.5 million,
while earnings per diluted share were up 8.0 percent to a record
US$1.35 from US$1.25 in fiscal 2005. EBIT increased 7.9 percent
to US$298.9 million from US$277.1 million a year ago, before
asbestos charges.
Based in Medina, Ohio, RPM International Inc. makes home repair
products. The Company is divided into two units: industrial
products (waterproofing, corrosion resistance, floor
maintenance, and wall finishing) and consumer products (caulks
and sealants, rust-preventative and general-purpose paints,
patch and repair products, and hobby paints).
ASBESTOS LITIGATION: RPM Int'l. Has $58.9Mil Current Liabilities
----------------------------------------------------------------
RPM International Inc.'s asbestos-related liabilities, for the
year ended May 31, 2006, was US$58,925,000 compared with
US$55,000,000 for the same period in 2005, according to a
Company press release dated July 24, 2006.
The Company's non-current asbestos-related liabilities, for the
year ended May 31, 2006, was US$362,360,000 compared with
US$46,172,000 for the same period in 2005.
For the year ended May 31, 2006, RPM's net asbestos charges
interest expense was US$41,343 million compared with
US$35,378,000 for the year ended May 31, 2005.
For the three months ended May 31, 2006, the Company's net
asbestos charges interest expense was US$12,952,000 compared
with US$9,893,000 for the three months ended May 31, 2005.
The Company increased its existing asbestos reserve by US$321
million to cover the costs of future claims through May 2016.
Related payments for indemnity and defense costs of US$12.9
million this fourth quarter bring the 2006 fiscal-year total to
US$59.9 million, or 11.1 percent lower than the US$67.4 million
paid during fiscal 2005. The Company took an additional US$14
million charge this fourth quarter to increase its asbestos
liability reserves to fully provide for known, in-house claims
at year-end.
Total asbestos reserves on RPM's May 31, 2006 balance sheet
amounting to US$421.3 million will be drawn down as expenditures
are made for indemnity and defense costs in coming years, and
adjusted when necessary.
"Based on our current outlook, we anticipate that the draw down
of this reserve will be higher in its earlier years and decline
over time, which is consistent with our recent experience," said
Frank C. Sullivan, RPM President and Chief Executive Officer.
Based in Medina, Ohio, RPM International Inc. makes home repair
products. The Company is divided into two units: industrial
products (waterproofing, corrosion resistance, floor
maintenance, and wall finishing) and consumer products (caulks
and sealants, rust-preventative and general-purpose paints,
patch and repair products, and hobby paints).
ASBESTOS LITIGATION: Crane Posts Long-term Liability at $509.5M
---------------------------------------------------------------
Crane Co.'s long-term asbestos liability, as of June 30, 2006,
was US$509,559,000 compared with US$526,830,000 as of Dec. 31,
2005.
As of March 31, 2006, the Company's long-term asbestos liability
stood at US$515,762,000. (Class Action Reporter, April 28, 2006)
As of June 30, 2006, Crane's asbestos-related insurance
receivable was US$216,449,000 compared with US$224,600,000 as of
Dec. 31, 2005.
As of March 31, 2006, the Company recorded US$222,833,000 for
its asbestos-related insurance receivable. (Class Action
Reporter, April 28, 2006)
Asbestos-related payments, net of insurance recoveries, amounted
to US$220,000 for the three-month period ended June 30, 2006,
compared with (US$8,434,000) for the same period in 2005.
For the six-month period ended June 30, 2006, asbestos-related
payments, net of insurance recoveries, amounted to
(US$9,080,000) compared with (US$19,258,000) for the same period
in 2005.
Based in Stamford, Connecticut, Crane Co. makes industrial
products, including fluid handling equipment, aerospace
components, engineered materials, merchandising systems, and
controls. The Company serves the power generation, general
aviation, commercial construction, food and beverage, and
chemical industries.
ASBESTOS LITIGATION: Crane Co. Records 88,833 Claims in 2Q06
------------------------------------------------------------
Crane Co. recorded 88,833 asbestos-related claims against it as
of June 30, 2006, compared with 88,563 asbestos-related claims
as of June 30, 2005.
The 88,833 claims do not include 36,175 maritime actions that
were filed in the U.S. District Court for the Northern District
of Ohio and transferred to the Eastern District of Pennsylvania.
Of the 88,833 pending claims, about 25,000 claims were pending
in New York, about 32,500 claims were pending in Mississippi,
about 9,000 claims were pending in Texas, and about 3,400 claims
were pending in Ohio.
As of March 31, 2006, Crane had 89,164 pending asbestos-related
claims against it. (Class Action Reporter, April 28, 2006)
The gross settlement and defense costs incurred, before
insurance and tax effects, for the Company in the six-month
period ended June 30, 2006 totaled US$31.2 million compared with
US$19.9 million in the same period in 2005.
The Company's total pre-tax cash payments for settlement and
defense costs, net of payments from insurers and including
certain legal fees and expenses relating to the terminated
Master Settlement Agreement in the six-month period ended June
30, 2006 totaled US$9.1 million compared with US$19.2 million in
the same period in 2005.
On July 22, 2005, the Company entered into an agreement to
settle its insurance coverage claims for asbestos and other
liabilities against underwriters at Lloyd's of London reinsured
by Equitas Ltd. for a total payment of US$33 million. In the
agreement, US$1.5 million was paid to the Company in the 2005-
3rd quarter.
Effective March 1, 2006, the Company entered into two agreements
with Hartford Accident and Indemnity Co. and certain affiliated
firms settling all outstanding claims under the Company's
primary policies with Hartford for a final payment of US$1.3
million and creating a coverage-in-place arrangement for
asbestos claims under the Company's excess policies with
Hartford, including a payment of US$2.6 million for claims
billed to Hartford through September 1, 2005.
Effective April 10, 2006, the Company and Everest Reinsurance
Co. and Mt. McKinley Insurance Co. reached a settlement
agreement pursuant to Everest's and Mt. McKinley's insurance
coverage obligations for asbestos claims under three historical
policies issued to Crane Co. were released. On April 21, 2006,
the Company received a US$3.8 million cash payment under this
settlement agreement.
On June 30, 2006, the Company and Fireman's Fund Insurance Co.
entered into an agreement, effective July 3, 2006, establishing
a coverage-in-place arrangement for asbestos claims under the
Company's excess policies with Fireman's Fund, including a
payment of US$2.3 million for claims billed to Fireman's Fund
through June 26, 2006, to be paid on or before Aug. 15, 2006.
Based in Stamford, Connecticut, Crane Co. makes industrial
products, including fluid handling equipment, aerospace
components, engineered materials, merchandising systems, and
controls. The Company serves the power generation, general
aviation, commercial construction, food and beverage, and
chemical industries.
ASBESTOS LITIGATION: Crane Settles With 2 Insurers in Conn. Suit
----------------------------------------------------------------
Crane Co., effective April 10, 2006, settled with Everest
Reinsurance Co. and Mt. McKinley Insurance Co., in which the two
insurers were plaintiffs in a Connecticut state court action
filed against Crane.
The Company reached a settlement with Everest and Mt. McKinley
under the two insurers' insurance coverage obligations for
asbestos claims in three historical Everest and McKinley
policies issued to the Company.
The policies were released in exchange for a US$3.8 million cash
payment, which was received by the Company on April 21, 2006.
On Jan. 21, 2005, five of Crane's insurers within two corporate
insurer groups, in Connecticut state court, sought injunctive
relief against the Company and declaratory relief against the
Company and dozens of the Company's other insurers.
On April 8, 2005, the insurer plaintiffs filed an Amended
Complaint raising five counts against the Company.
The Amended Complaint sought:
-- Declaratory relief regarding the Company's rights to
coverage, if any, under the policies;
-- Declaratory relief regarding the Company's alleged breaches
of the policies in connection with an alleged increase in
asbestos claim counts;
-- A declaration of no coverage in connection with allegedly
time-barred claims;
-- Declaratory relief against the Company and the other insurer
defendants for allocation of damages that may be covered under
the insurance policies; and
-- Preliminary and permanent injunctive relief.
On April 18, 2005, the Company moved to dismiss the claims for
injunctive relief. On Oct. 19, 2005, the Court denied the
Company's move, ruling that the injunctive claims were "not
unripe."
Based in Stamford, Connecticut, Crane Co. makes industrial
products, including fluid handling equipment, aerospace
components, engineered materials, merchandising systems, and
controls. The Company serves the power generation, general
aviation, commercial construction, food and beverage, and
chemical industries.
ASBESTOS LITIGATION: USG Records $27M Reversal of Claims Reserve
----------------------------------------------------------------
USG Corporation, in its 2006-2nd quarter results, noted an
inclusion of a US$27 million reversal of a reserve for asbestos-
related claims, according to a Company press release dated July
24, 2006 reported the U.S. Securities and Exchange Commission.
This reversal was based on USG's evaluation of the asbestos
property damage settlements it has reached in principle and the
remaining unresolved asbestos property damage claims. The after-
tax income from this reversal amounted to US$17 million, or
US$0.29 a share.
USG reported 2006-2nd quarter net sales of US$1.6 billion and
net earnings of US$176 million. Net sales increased US$286
million, or 22 percent, and net earnings increased US$66
million, or 60 percent, compared with the 2005-2nd quarter.
Diluted earnings per share for the 2006-2nd quarter were
US$3.03, compared with US$1.96 in the same period a year ago.
Net sales for the first half of 2006 were US$3 billion compared
with US$2.5 billion for the same period in 2005. Net earnings
were US$35 million, or US$0.60 per share, for the first six
months of 2006. Net earnings of US$187 million, or US$3.33 per
share, were recorded in the first six months of 2005.
Second quarter and first half results also included a charge for
post-petition interest and fees related to pre-petition
obligations, primarily debt and trade payables.
The Company noted US$36 million pretax charges for the 2006-2nd
quarter and US$520 million pretax charges for the first six
months of 2006. The corresponding after-tax amounts for the
2006-2nd quarter were US$21 million, or US$0.36 a share, and
US$321 million, or US$5.54 a share, for the first half of 2006.
USG Chairman and Chief Executive Officer William C. Foote said,
"With our emergence from bankruptcy on June 20th, I am pleased
to report that USG has delivered on its commitment to repay our
creditors in full, compensate those who have been injured by
asbestos, preserve equity value and emerge operationally
stronger."
Based in Chicago, Illinois, USG Corp.'s North American Gypsum
division makes SHEETROCK brand gypsum products and joint
compound and DUROCK brand cement board. It also makes abuse-
resistant wall panels (FIBEROCK), poured gypsum underlayments
(LEVELROCK), and construction plaster products.
ASBESTOS LITIGATION: BOC Group Faces About 15,966 Injury Claims
---------------------------------------------------------------
The BOC Group plc noted a total of about 15,966 claimants at
Sept. 30, 2005, in pending asbestos related cases that name The
BOC Group Inc. as a defendant, a net decrease of about 600 from
Sept. 30, 2004, according to a Group Report filed on Form 6-K,
dated July 24, 2006, filed with the U.S. Securities and Exchange
Commission.
The BOC Group Inc., the Group's U.S. subsidiary, is a defendant
in these cases that claim compensatory and punitive damages for
alleged injuries, including cancer, through exposure to asbestos
in welding fumes or from welding consumables. A number of these
claimants allege injuries from exposure to asbestos in non-
welding rod products and premises.
The BOC Group, Inc. has been a co-defendant in other asbestos
related claims that have been resolved. From Jan. 1, 1997 to
Sept. 30, 2005, 11,776 claims were dismissed and 75 claims were
dismissed on summary judgments.
Through Sept. 30, 2005, nine cases were tried to final jury
verdicts in favor of the defendants, including The BOC Group
Inc., and one case was tried to a final jury verdict in favor of
the plaintiffs, which is being appealed.
Based in Surrey, England, The BOC Group produces industrial and
specialty gases. BOC's operations include the manufacture and
distribution of gases and the installation of plants that
produce nitrogen, argon, and other gases used to make industrial
metals and other products.
ASBESTOS LITIGATION: Corning Records $7Mil Settlement Adjustment
----------------------------------------------------------------
Corning Inc. recorded a US$7 million charge in the 2006-2nd
quarter to adjust the estimated fair value of certain other
components of its proposed asbestos settlement, according to a
Company press release dated July 25, 2006.
The Company also recorded a credit of US$61 million, pretax and
after-tax, including a mark-to-market credit of US$68 million
reflecting the decrease in its common stock from March 31, 2006
to June 30, 2006.
On March 28, 2003, Corning had reached agreement with the
representatives of asbestos claimants for the settlement of all
current and future asbestos claims against Corning and
Pittsburgh Corning Corp., which might arise from PCC products or
operations.
The proposed settlement, when the plan becomes effective, will
require Corning to relinquish its equity interest in PCC,
contribute its equity interest in Pittsburgh Corning Europe
N.V., a Belgian corporation, and contribute 25 million shares of
Corning common stock.
Corning also agreed to make cash payments with a value of US$131
million, in March 2003, over six years from the effective date
of the settlement and to assign insurance policy proceeds from
its primary insurance and a portion of its excess insurance at
the time of the settlement.
The Company announced 2006-2nd quarter sales of US$1.26 billion
and net income of US$514 million, or US$0.32 a share. These
results include net special gains of US$93 million, or US$0.06 a
share.
A US$61 million gain primarily to reflect the decrease in the
market value of Corning common stock to be contributed to settle
the asbestos litigation related to PCC was included in Corning's
2006-2nd quarter results.
Based in Corning, New York, Corning Inc. makes fiber-optic
cable, which it invented more than 30 years ago. Once known
mainly for its kitchenware and lab products, the Company now
provides optical fiber and cable products and communications
network equipment. Other business segments include environmental
technologies and life sciences.
ASBESTOS LITIGATION: BNSF Railway's Claims Remain at 2,153 in 2Q
----------------------------------------------------------------
Burlington Northern Santa Fe Corporation recorded 2,153
asbestos-related claims filed against subsidiary BNSF Railway
Co. at June 30, 2006.
The Company reported 2,153 unresolved asbestos-related claims at
March 31, 2006 compared with 1,919 unresolved claims at March
31, 2005. (Class Action Reporter, April 28, 2006)
At June 30, 2005, the Company had 2,120 asbestos-related claims
filed against BNSF Railway.
For the three months ended June 30, 2006, the Company filed 150
claims compared with 312 claims for the same period in 2005. For
the three months ended June 30, 2006, the Company noted 150
claims that were settled, dismissed, or resolved, compared with
111 claims for the same period in 2005.
The Company defends in personal injury claims by employees and
non-employees who may have been exposed to asbestos. The
heaviest exposure for BNSF Railway employees was due to work
conducted in and around the use of steam locomotive engines that
were phased out between 1950 and 1967.
However, other types of exposures, including exposure from
locomotive component parts and building materials, continued
after 1967, until they were eliminated by 1985.
For the three months ended June 30, 2006 and June 30, 2005, the
Company paid US$4 million for asbestos matters.
For the three months ended June 30, 2006, the Company accrued
US$318 million obligations for asserted and unasserted asbestos
matters compared with US$336 million for the same period in
2005.
Of the June 30, 2006 obligation, US$256 million was related to
unasserted claims while US$62 million was related to asserted
claims. At June 30, 2006, US$21 million was included in current
liabilities.
Based in Fort Worth, Texas, Burlington Northern Santa Fe
Corp., through subsidiary BNSF Railway Co., operates as a
railroad running through 28 states in the West, Midwest, and
Sunbelt regions of the U.S. and in two Canadian provinces.
ASBESTOS LITIGATION: ENSCO Has Multiparty Suits in Miss. Courts
---------------------------------------------------------------
ENSCO International Inc. and certain of its subsidiaries
continue to face multi-party asbestos-related lawsuits filed in
the Circuit Courts of Jones County, Second Judicial District,
and Jasper County, First Judicial District, Miss.
Filed in Aug. 2004, the suits seek monetary damages on behalf of
individuals alleging personal injury or death, including claims
under the Jones Act, purportedly resulting from exposure to
asbestos on drilling rigs and associated facilities during 1965
through 1986.
Following the recent lapse of a period of time granted by the
Special Master appointed to oversee the litigation, all
plaintiffs were required to prepare and submit "Fact Sheets" to
facilitate the determination of issues or facts as:
-- Whether the plaintiffs have a proper cause of action;
-- Which defendants are the focuses of a particular plaintiff's
claim;
-- By whom a plaintiff may have been employed and the period(s)
of employment;
-- Where a plaintiff resides and whether the Miss. courts have
jurisdiction over their alleged claim; and
-- Venue, assuming the Miss. courts have jurisdiction.
The suits are at their preliminary stages.
Based in Dallas, Texas, ENSCO International Inc. is an offshore
drilling contractor. The Company does most of its domestic
drilling business in the Gulf of Mexico, but also operates in
the North Sea, offshore West Africa, Indonesia, Trinidad, and in
the Asia-Pacific region.
ASBESTOS LITIGATION: LECO Faces Claims With 33,604 Plaintiffs
-------------------------------------------------------------
Lincoln Electric Holdings Inc. is a co-defendant in cases
alleging asbestos-induced illness involving claims by about
33,604 plaintiffs, as of June 30, 2006.
As of March 31, 2006, the Company had cases alleging asbestos
induced illness involving claims by about 33,987 plaintiffs.
(Class Action Reporter, May 5, 2006)
In the asbestos cases, the claimants allege that exposure to
asbestos in welding consumables caused the plaintiffs to develop
adverse pulmonary diseases, including mesothelioma and other
lung cancers.
In each instance, the Company is one of a large number of
defendants. The claimants seek compensatory and punitive damages
for unspecified sums.
Since January 1, 1995, the Company has been a co-defendant in
other similar cases that have been resolved as follows: 20,851
of those claims were dismissed, nine were tried to defense
verdicts, four were tried to plaintiff verdicts -- two of which
were satisfied and two of which are subject to appeal -- and 325
were decided in favor of the Company following summary judgment
motions.
In the U.S., asbestos use in welding consumables ceased in 1981.
Based in Cleveland, Ohio, Lincoln Electric Holdings Inc. makes
arc-welding, cutting products, and welding supplies, including
arc-welding power sources, automated wire-feeding systems, and
consumable electrodes for arc welding.
ASBESTOS LITIGATION: American Standard Has 114,669 Claims in 2Q
---------------------------------------------------------------
American Standard Companies Inc. reported that it faced 114,669
open asbestos-related claims filed against it as of June 30,
2006, compared with 128,197 claims as of Dec. 31, 2005.
As of June 30, 2006, the Company recorded 2,327 new claims
filed, 263 claims settled, and 9,726 claims dismissed.
Over the years, the Company co-defends in numerous lawsuits
alleging various asbestos-related personal injury claims arising
from its historical sales of boilers and railroad brake shoes.
Many of these suits involve multiple claimants, do not identify
the injury or disease for which damages are sought, and do not
allege a connection between any Company product and a claimed
injury or disease. Hence, numerous suits have been placed on the
inactive or deferred dockets.
At June 30, 2006, the total asbestos liability was estimated at
US$680.7 million compared with US$686 million at Dec. 31, 2005.
The asbestos indemnity liability decreased by US$5.3 million
during the first six months of 2006 due to claims payments made
during the first half of the year.
The asbestos indemnity liability decreased by US$13.4 million in
2005, from US$699.4 million as of December 31, 2004 to US$686
million as of December 31, 2005. This decrease was due to claims
payments made during the year.
The total amount of all settlements paid by the Company,
excluding insurance recoveries, and by its insurance carriers is
about US$69.7 million, for an average payment per resolved claim
of US$1,376.
The average payment per claim resolved during the six months
ended June 30, 2006 was US$519 compared with US$1,026 for the
year ended December 31, 2005.
From receipt of its first asbestos claim more than 20 years ago
to June 30, 2006, the Company has resolved 50,669 claims.
Based in Piscataway, New Jersey, American Standard Cos. Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems. Deriving over half of sales, the
Company's air-conditioning division makes consumer and
commercial systems under the Trane and American Standard brand
names.
ASBESTOS LITIGATION: American Standard Has Action in N.J. Court
---------------------------------------------------------------
American Standard Companies Inc. is involved in litigation
against certain carriers whose policies, the Company claimed,
provide asbestos claims coverage. The insurance carriers in the
lawsuit, filed in New Jersey, are challenging the Company's
right to recovery.
In April 1999, the Company sued several of its primary and lower
layer excess insurance carriers in the Superior Court of New
Jersey, Middlesex County, seeking coverage for environmental
claims.
The New Jersey litigation was later expanded to also seek
coverage for asbestos related liabilities from 21 primary and
lower layer excess carriers and underwriting syndicates.
On Sept. 19, 2005, the Court granted the Company's motion to add
to the N.J. Litigation 16 additional insurers and 117 new
insurance policies.
The Company and the defendants in the New Jersey litigation have
engaged in several mediation sessions since Jan. 18, 2006. On
May 15, 2006, the Court issued an order to extend discovery
through Dec. 8, 2006.
In February 2005, the Company settled with Equitas Ltd. for
US$84.5 million to buy out the participants of certain
underwriters in pre-1993 Lloyd's, London policies included in
the Company's insurance coverage.
Through June 30, 2006, US$16.2 million of this amount was
received by the Company to cover asbestos and environmental
costs, and US$68.3 million remains in a trust expiring Jan. 3,
2007.
At June 30, 2006, the Company's asbestos receivable was US$390.1
million compared with US$390 million at Dec. 31, 2005. During
the six-month period, the Company had received cash from
insurance companies of US$8.5 million, offset by the recoverable
portion of incurred legal expenses and refinements to
settlements of US$8.6 million.
Based in Piscataway, New Jersey, American Standard Cos. Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems. Deriving over half of sales, the
Company's air-conditioning division makes consumer and
commercial systems under the Trane and American Standard brand
names.
ASBESTOS LITIGATION: Litigation Ebbs in Face of Legal Reforms
-------------------------------------------------------------
Asbestos litigation in the U.S. has receded in response to legal
reforms by state legislatures and counts around the country,
Financial Times reports.
Figures for 2005 show a decline of more than 75 percent against
some defendants. The fall has come in claims filed by plaintiffs
who have been exposed to asbestos but are not ill, the bulk of
the type of litigation that has forced 78 firms into bankruptcy
since the mid-1970s.
According to NERA Economic Consulting figures, asbestos claims
against Viacom Inc., for example, have fallen from 60,000 in
2001 to 11,470 in 2005. Claims against Union Carbide Corp. have
dropped from more than 122,000 in 2003 to about 34,000 in 2005.
Claims for the Manville Trust, long regarded as a reliable
indicator of asbestos litigation, have fallen from 101,000 in
2003 to 18,000 in 2005.
"There has been a sea change in asbestos litigation," according
to Edmund Kelly, chief executive of Liberty Mutual, the
insurance company, in testimony to Congress in June 2006.
The decline in asbestos litigation, coupled with recent
victories by the tobacco firms in fending off cigarette suits,
could be signs that some of the biggest legal threats that have
haunted corporate America for the past few decades may be
receding.
Congress has so far failed to pass legislation to tackle the
asbestos crisis, including a US$140 billion (EUR110 billion)
trust fund that failed by two votes in the Senate in February
2006.
Sen. Arlen Specter, a Pa. Republican and the chairman of the
Senate judiciary committee, is trying to revive the legislation
but chances of passage appear slim.
Several state legislatures have passed laws that crack down on
lawsuit abuse, and judges have made it harder for "unimpaired"
plaintiffs to get into court.
ASBESTOS LITIGATION: W.R. Grace, Creditors Unable to Strike Deal
----------------------------------------------------------------
Bankruptcy lawyers said that an attempt to strike a deal between
W.R. Grace & Co. and its asbestos creditors has failed, Dow
Jones Newswires reports.
Grace's lead bankruptcy lawyer, David Bernick, said it had
decided not to negotiate further when asbestos-claim lawyers
offered nothing for shareholders.
In 2006, U.S. Bankruptcy Judge Judith Fitzgerald appointed a
mediator to attempt to settle differences between Grace and
lawyers for people with asbestos-related diseases and property
damage.
Lawyers for asbestos creditors also told Judge Fitzgerald that
the mediation with the company wasn't successful. Grace wants to
settle the claims of those with asbestos-related diseases and
property damage without taking all the value out of the hands of
its shareholders.
Mr. Bernick said that the negotiations with asbestos claimants
could resume at some point in the future, but he added that the
main priority for the Company is to get an estimate of its
liabilities.
Grace and some top-ranking executives pleaded not guilty for the
second time to federal criminal charges that grew out of its
mining operation in Libby, Mont.
Based in Columbia, Maryland, W.R. Grace & Co. filed for Chapter
11 protection in 2001 in an effort to resolve liabilities
stemming from products containing asbestos.
ASBESTOS ALERT: Court Issues Split Ruling on Greene, Tweed Suit
---------------------------------------------------------------
The U.S. District Court, Eastern District of Pennsylvania,
partially granted and denied Greene, Tweed & Co. Inc.'s motion
for partial summary judgment against American Home Assurance Co.
and Allstate Insurance Co., in an insurance-related asbestos
case.
U.S. Magistrate Judge Thomas J. Rueter handed down the decision
for Civil Action No. 03-3637 on April 21, 2006.
Greene Tweed sued for declaratory judgment against American Home
and Allstate. The two firms issued Umbrella Excess Liability
insurance policies to Greene Tweed.
Greene Tweed sought a declaration as to the extent of coverage
under these UEL policies for personal injury claims asserted
against it from alleged exposure to asbestos in products made
and sold by Greene Tweed.
On May 14, 2004, Greene Tweed moved for partial summary judgment
against American Home and Allstate. On May 14, 2004, American
Home moved for partial summary judgment. Allstate joined in the
motion filed by American Home.
In the case, the 60,000 asbestos claims against Greene Tweed
have a common source or cause: Greene Tweed's manufacture and
sale of asbestos products. The limit of American Home's
liability to Greene Tweed is US$10 million for the asbestos
claims and Allstate's limit of liability is US$15 million for
the asbestos claims.
Greene Tweed's motion against American Home and Allstate was
denied on the issue of number of occurrences and granted as to
the issue of American Home Policy's Non-Cumulation Clause.
The partial summary judgment motion of American Home and
Allstate was granted and denied in part on the issue of the
number of occurrences but denied on the issue of American Home
Policy's Non-Cumulation Clause.
Jacquelyn J. Ager and Robert N. Feltoon of Conrad, O'Brien,
Gellman & Rohn PC, Philadelphia, Pa., Neil K. Roman, Richard
Beckmann, and William Greaney of Covington & Burling,
Washington, D.C, represented Greene, Tweed & Co. Inc.
Charles L. Kerr, Susan E. Quinn, Morrison, Forrester, et al.,
New York, N.Y., David Newmann, Hogan & Hartson LLP,
Philadelphia, Pa., David E. Dopf, Loren L. Pierce, McElroy
Deutsch & Mulvaney LLP, Lorraine M. Armenti, Coughlin Duffy,
Morristown, N.J., John C. Sullivan, Kathleen K. Kerns, Post &
Schell PC, Philadelphia, Pa., Eric J. Voigt, John F. Parker,
Mound, Cotton, Wollan & Greengrass, New York, N.Y., Mitchell S.
Pinsly, Margolis, Edelstein, Philadelphia, Pa., Michael J.
Jones, Stefano V. Calogero, Cuyler, Burk LLP, Parsippany, N.J.,
represented American Home Assurance Co. and Allstate Insurance
Co.
COMPANY PROFILE
Greene, Tweed & Co.
2075 Detwiler Rd.
Kulpsville, PA 19443
Phone: 215-256-9521
Fax: 215-256-0189
http://www.gtweed.com
Description:
Established in 1863, the Company makes specialty seals, gaskets,
and engineered plastic components for applications in the
aerospace and defense, pharmaceutical, chemical, petrochemical,
oilfield equipment manufacturing, industrial hydraulics, and
semiconductor industries.
New Securities Fraud Cases
NPS PHARMACEUTICALS: Federman & Sherwood Reports Filing of Suit
---------------------------------------------------------------
Federman & Sherwood announces that on July 12, 2006, a class
action was filed in the U.S. District Court for the District of
Utah against NPS Pharmaceuticals, Inc.
The complaint alleges violations of federal securities laws,
Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of
1934 and Rule 10b-5, including allegations of issuing a series
of material misrepresentations to the market which had the
effect of artificially inflating the market price. The class
period is from Aug. 10, 2005 to May 2, 2006.
Interested parties may move the court no later than Sept. 11,
2006 for appointment as lead plaintiff for the class.
For more details, contact William B. Federman of Federman &
Sherwood, 120 N. Robinson, Suite 2720, Oklahoma City, OK 73102,
Phone: (405) 235-1560, Fax: (405) 239-2112, E-mail:
wfederman@aol.com, Web site: http://www.federmanlaw.com.
PAR PHARMACEUTICAL: Schiffrin & Barroway Files Stock Lawsuit
------------------------------------------------------------
Schiffrin & Barroway, LLP filed a class action in the U.S.
District Court for the District of New Jersey on behalf of all
securities purchasers of Par Pharmaceutical Companies, Inc. from
April 29, 2004 through July 5, 2006.
The complaint charges Par and certain of its officers and
directors with violations of the U.S. Securities Exchange Act of
1934.
More specifically, the complaint alleges that the company failed
to disclose and misrepresented the following material adverse
facts, which were known to defendants or recklessly disregarded
by them:
-- that the company materially overstated its financial
results by at least $55 million;
-- specifically, that the company delayed recognition of
customer credits and uncollectible customer deductions,
which resulted in an understatement of accounts
receivable revenues;
-- that the company failed to take timely write-downs of
the company's inventory, which caused the company to
overstate the worth of its inventory by at least $15
million;
-- that the company lacked adequate internal controls;
-- that the company's financial statements were presented
in violation of Generally Accepted Accounting
Principles; and
-- that, as a result of the above, the company's financial
statements were materially false and misleading at all
relevant times.
On July 5, 2006, after the market closed, Par announced that the
company had discovered certain accounting errors and
consequently would restate sales and income figures for fiscal
years 2004, 2005, and the first quarter of 2006.
Specifically, the company stated that an internal review of its
trade accounts receivable balances revealed accounting errors
that would result in the restatement of financial results for
fiscal years 2004 and 2005 and the first quarter of 2006.
The company also reported that it expected that the effect of
the restatement adjustments to its accounts receivable would be
to reduce revenues by an amount up to $55 million over the
applicable periods, prior to any potential recoveries.
In addition, Par announced that it would write-off inventory in
an amount up to $15 million. On this news, shares of Par
plummeted $4.78, or 26.2 percent, to close, on July 6, 2006, at
$13.47 per share, on heavy trading volume.
Subsequently, on July 24, 2006, the company filed a current
report with the U.S. Securities and Exchange Commission on Form
8-K. Therein, the defendants disclosed that the SEC had
commenced an informal probe into the Company's restatement.
Interested parties may no later than Sept. 15, 2006, move the
court for appointment as lead plaintiff of the class.
For more details, contact Darren J. Check, Esq. or Richard A.
Maniskas, Esq. of Schiffrin & Barroway, LLP, Phone: 1-888-299-
7706 or 1-610-667-7706, E-mail: info@sbclasslaw.com, Web site:
http://www.sbclasslaw.com.
RAMBUS INC: Schatz & Nobel Announces Filing of Calif. Stock Suit
----------------------------------------------------------------
The law firm of Schatz & Nobel, P.C. announces that a lawsuit
seeking class-action status has been filed in the U.S. District
Court for the Northern District of California on behalf of all
persons who purchased or otherwise acquired the publicly traded
securities of Rambus between Dec. 12, 2001 and June 27, 2006,
inclusive.
The complaint alleges that defendants violated federal
securities laws by issuing a series of materially false
statements.
Specifically, defendants made misleading statements and
omissions concerning Rambus' improper and undisclosed practice
of backdating options. This improper backdating masked the
virtually instant profits the option recipients obtained.
Under generally accepted accounting principles, these profits
were required to be recognized as an expense in the company's
financial statements for the appropriate period, but were not.
This backdating of options also violated provisions of the
Internal Revenue Code relating to deduction of option payments.
Thus, the company's financial statements in Form 10-K filings
for the years 2002, 2003, 2004 and 2005 were materially false
and misleading. In addition, the company's Proxy Statements for
annual shareholder meetings held in years 2002 to 2005 were also
misleading because they contained statements concealing Rambus'
practice of backdating stock options.
Interested parties may, no later than Sept. 18, 2006, request
the court for appointment as lead plaintiff of the class.
For more details, contact Wayne T. Boulton and Nancy A. Kulesa
of Schatz & Nobel, P.C., Phone: (800) 797-5499, E-mail:
sn06106@aol.com, Web site: www.snlaw.net.
VONAGE HOLDINGS: Aug. 1 Deadline Set for Lead Plaintiff Filing
--------------------------------------------------------------
Pomerantz Haudek Block Grossman & Gross, LLP announces that Aug.
1, 2006 is the deadline for qualified investors of Vonage
Holdings Corp. to request the court for appointment as lead
plaintiff in the class action against the defendant.
Pomerantz Haudek filed a class action in the U.S. District Court
District of New Jersey against the company and other related
defendants. The class action was filed on behalf of purchasers
of the common stock of the company pursuant to its Directed
Share Program, which was offered in the company's May 23, 2006
initial public offering. The complaint alleges violations of
Section 5, 11, 12(a) (2), and 15 of the U.S. Securities Act.
Vonage describes itself as a leading provider of broadband
telephone services, whose technology enables anyone to make and
receive phone calls with a touch tone telephone almost anywhere
a broadband Internet connection is available.
The complaint alleges that, in connection with the company's
Directed Share Program, defendants failed to disclose that:
-- Vonage's technology platform experienced problems
carrying telephone data over the networks of certain
Internet service providers, including AOL;
-- Vonage's voice-over-Internet protocol technology did
not properly allow facsimile transmissions; and
-- the company did not adequately inform Vonage customers
who opened brokerage accounts and participated in
Vonage's Directed Share Program concerning the
customers' obligations to purchase allocated shares.
Furthermore, the complaint alleges that the IPO offering
violated Section 5 of the Securities Act because the company's
e-mails to prospective participants in the program did not
include an active hyperlink to the prospectus contained in
Vonage's most recently filed registration statement.
Immediately following the IPO, shares of Vonage declined from
the offering price of $17.00 per share to close on May 24, 2006,
at $14.85 per share, a loss of $2.15, or 12.6 percent, amid
concerns about the company's ability to compete in the market
place.
Thereafter, shares of Vonage continued to slide on news that the
company's Directed Share Program was a debacle in light of
several technical and legal failures. In the seven days after
the IPO, shares of Vonage plummeted by nearly one third of its
initial offering price of $17.00.
For more details, contact Teresa L. Webb or Carolyn S. Moskowitz
of Pomerantz Haudek Block Grossman & Gross, LLP, Phone: 888-476-
6529, E-mail: tlwebb@pomlaw.com and csmoskowitz@pomlaw.com.
ZALE CORP: Stull, Stull Announces Filing of N.Y. Securities Suit
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Stull, Stull & Brody announces that a class action was commenced
in the U.S. District Court for the Southern District of New York
on behalf of all persons who purchased or acquired the publicly
traded securities of Zale Corp. between Feb. 18, 2005 and May 5,
2006, inclusive. The lawsuit was filed against Zale and Mary L.
Forte, Mark R. Lenz, Cynthia T. Gordon and Sue E. Gove.
The complaint alleges that defendants violated Section 10(b) and
20(a) of the U.S. Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder.
Specifically, the complaint alleges that defendants issued a
series of material misrepresentations to the market, which had
the impact of artificially inflating the market price of Zale
securities.
Unbeknownst to investors, the representations in the company's
reported results of operations materially overstated Zale's net
cash flows and free operating cash flows, which are important
measures of the company's cash generating abilities. In
addition, the company improperly accounted for extended service
agreements, leases and accrued payroll.
On April 10, 2006, before the open of regular trading, the truth
began to emerge as Zale announced that the U.S. Securities and
Exchange Commission had initiated a broad investigation into
many aspects of the company's accounting, operations and
disclosure practices, including Zale's accounting for extended
service agreements, leases, and accrued payroll, executive
compensation and severance, earnings guidance, stock trading and
the timing of vendor payments.
In reaction to this announcement, the price of Zale's stock fell
from $27.80 per share on April 7, 2006 to $25.16 per share on
April 10, 2006, the following trading day for a one-day loss of
11.5% on unusually heavy volume.
Then on Friday, May 5, 2006, after the market closed, Zale
announced that it had replaced its chief financial officer,
Defendant Lenz, after discovering that the Company improperly
inflated its reported net cash flows and free cash flows.
In response to the announcement, the price of Zale stock dropped
by $0.44 per share to close at $24.18 per share on May 8, 2006,
and by another $0.40 per share between May 8, 2006 and May 9,
2006, as the market continued to digest the information.
Interested parties may request the court for appointment as lead
plaintiff by no later than Sept. 18, 2006.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, Phone: 1-800-337-4983, Fax: 212-490-2022, E-mail:
SSBNY@aol.com, Web site: http://www.ssbny.com.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
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Class Action Reporter is a daily newsletter, co-published by
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Mendoza, Editors.
Copyright 2006. All rights reserved. ISSN 1525-2272.
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