/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/060811.mbx C L A S S A C T I O N R E P O R T E R Friday, August 11, 2006, Vol. 8, No. 159 Headlines AMPCO TRANSPORTATION: Settles Col. Racial Discrimination Suits AQUILA INC: August 2007 Trial Slated for ERISA Litigation in Mo. BMO NESBITT: Faces $100M Lawsuit Over Retirement Savings Plans CYNOSURE INC: Faces TCPA Suit in Mass. Over Unsolicited Faxes EASTMAN KODAK: Files Motion to Dismiss N.Y. Stock Fraud Suit FIFTH THIRD: Named in Payment Card Interchange Fee Suit in N.Y. HERCULES INC: Court Mulls Appeal on Dismissal of Dioxin Lawsuit HERCULES INC: Court Yet to Approve $1.4M Deal in Ga. Gulf Suit HERCULES INC: Plaintiffs Appeal Dismissal of Agent Orange Suits HERCULES INC: Settles Carbon Fiber Litigation in Calif., Mass. INTERPOOL INC: N.J. Court Approves Securities Suit Settlement KEYSPAN CORP: Sued Over Operations at Former Bay Shore Gas Plant MASTEC INC: Fla. Court Sets Hearing for $10M Stock Settlement MICROSOFT CORP: Faces Suits in Wash. Over WGA Anti-Piracy Tool MINNESOTA: Judge Allows Lawsuit Against Airports Commission MOLEX INC: Discovery Continues in Ill. Securities Fraud Suit NORTHERN STATES: Seeks Dismissal of Consumer Fraud Suit in Minn. NORTHWESTERN CORP: Agrees to Settle S.D. Livonia Employees Suit NPS PHARMACEUTICALS: Faces Securities Suits in Utah Over PREOS PFIZER INC: Settlement of Bjork-Shiley Heart Valves Suit Ongoing PREMIUM STANDARD: Continues to Face Mo. Property Injury Lawsuit PRUDENTIAL FINANCIAL: Faces New Lawsuit Over Stock Broker Pay PRUDENTIAL FINANCIAL: "Saunders" Plaintiffs May Re-file Claims PRUDENTIAL INSURANCE: Court Denies Appeal on Insurance Complaint PRUDENTIAL INSURANCE: Court Nixes Appeal on HMO Suit Settlement PRUDENTIAL SECURITIES: Continues to Face IPO Litigation in N.Y. QWEST COMMUNICATIONS: DERP Opts Out of $400M Suit Settlement SOUTHERN CO: Plaintiffs Appeal Claims Dismissal in Mirant Suit ST. PAUL: Minn. Court Considers Motion to Dismiss Stock Suit TASER INTERNATIONAL: Settles Ariz. Stock Fraud Lawsuit for $20M TRIZEC PROPERTIES: Faces Lawsuits in Ill. Over Brookfield Deal UNITED STATES: Pa. Residents Fail to Stop Foreclosure of Homes UNITED STATES: Investors Lose Out in Stock Suits, Research Says UNIVERSITY OF CALIFORNIA: Paying $12M in Discrimination Suit WACHOVIA CORP: To Pay $1.25M in Adelphia Securities Lawsuit WESBANCO INC: Reaches Settlement in American Bancorporation Suit WILLBROS GROUP: Settles Consolidated Tex. Securities Fraud Suit XCEL ENERGY: Appeal Planned on Minn. Court's Ruling in "Bender" XCEL ENERGY: Faces Suit in Miss. Over Carbon Dioxide Emissions Asbestos Alert ASBESTOS LITIGATION: Union Carbide Settles N.Y. Suit v. Carriers ASBESTOS LITIGATION: Union Carbide Faces 121,128 Claims in 2Q06 ASBESTOS LITIGATION: Union Carbide Sees $87M Liabilities in 2Q06 ASBESTOS LITIGATION: Union Carbide's Defense Costs Drop to $28M ASBESTOS LITIGATION: Claims v. UIC, Detroit Stoker Fall to 9,496 ASBESTOS LITIGATION: Maremont's Claims Decrease to 60,500 in 2Q ASBESTOS LITIGATION: ArvinMeritor Pegs Liability at $54M in 2Q06 ASBESTOS LITIGATION: ArvinMeritor Faces Rockwell Injury Suits ASBESTOS LITIGATION: CNA Financial Has $1.505B for Claims in 2Q ASBESTOS LITIGATION: Court Mulls Protecting CNA from New Claims ASBESTOS LITIGATION: Court Hears Closing Arguments in CNA Suit ASBESTOS LITIGATION: CNA Financial Deals With Burns & Roe Action ASBESTOS LITIGATION: CNA Financial Units Face Suits in 4 States ASBESTOS LITIGATION: Continental Casualty Faces Adams Litigation ASBESTOS LITIGATION: Pending Claims v. Dana Corp. Remain at 76T ASBESTOS LITIGATION: Dow Chemical Has $1.346B Liabilities in 2Q ASBESTOS LITIGATION: Anadarko Faces 3rd-Party Liability Lawsuits ASBESTOS LITIGATION: Navigators Group Links Loss to Settlements ASBESTOS LITIGATION: Crown Cork Wins Appeal in Robinson Suit ASBESTOS LITIGATION: Fla. Court Favors Kishes in Insurance Suit ASBESTOS LITIGATION: PPG Industries' Claims Remain at 116T in 2Q ASBESTOS LITIGATION: AK Steel Contends With 401 Exposure Suits ASBESTOS LITIGATION: Diamond Offshore Faces Suit in Miss. Courts ASBESTOS LITIGATION: Cytec Industries Inc. Has 10T Claims in 2Q ASBESTOS LITIGATION: Lawsuits v. Mine Safety Drop to 280 in 2Q06 ASBESTOS LITIGATION: Celanese Units Face 650 Pending Cases in 2Q ASBESTOS LITIGATION: Hanson PLC Notes 127,750 Open Claims in 2Q ASBESTOS LITIGATION: CIRCOR Units Face Suits with 22T Plaintiffs ASBESTOS LITIGATION: Central Hudson Records 1,161 Cases in 2Q06 ASBESTOS LITIGATION: CPChem, ConocoPhillips Dispute Over Claims ASBESTOS LITIGATION: TRW Automotive Faces Claims v. Subsidiaries ASBESTOS LITIGATION: Navigators Group Sets Aside Claims Reserves ASBESTOS LITIGATION: Hartford Fin. Has $2.32B Liability in 2Q06 ASBESTOS LITIGATION: SCC Affiliates Contend With ASARCO Lawsuits ASBESTOS LITIGATION: Sealed Air Updates WR Grace Suit in Canada ASBESTOS LITIGATION: Sealed Air Accrues $106.9M Interest in 2Q06 ASBESTOS LITIGATION: Calif. County Drops Suit v. Sempra, SDG&E ASBESTOS LITIGATION: Foster Wheeler Gains From $79.6M Settlement ASBESTOS LITIGATION: DEQ Charges Ore. Hospital $10.2T for Breach ASBESTOS LITIGATION: Relief Trust Reports ZAR91M Payout in 2 Yrs ASBESTOS LITIGATION: W.Va. Court Receives Ambrose, Ullum Suits ASBESTOS LITIGATION: Probe Tags Engineer's Death to Mesothelioma ASBESTOS LITIGATION: Court Disallows Biersdorf Claims v. Grace ASBESTOS LITIGATION: Owens Corning Reports Move to Pay Trustees ASBESTOS LITIGATION: Sealed Air Corp Mulls Settlement with Grace New Securities Fraud Cases INFOSONICS CORP: Scott + Scott Sets Lead Plaintiff Deadline RAMBUS INC: Johnson & Perkinson Files Securities Fraud Suit SAFENET INC: Kahn Gauthier Announces N.Y. Securities Suit Filing ********* AMPCO TRANSPORTATION: Settles Col. Racial Discrimination Suits -------------------------------------------------------------- Mississippi lawyer Anne T. Sulton announced that her clients, former employees of Ampco Transportation System Inc., have settled two racial discrimination lawsuits filed in the U.S. District Court for the District of Colorado against the company, The Denver Post reports. In 2004, six black Ampco workers filed the first lawsuit "Woods, et al. v. Ampco Sys Trans Inc., et al., Case No. 1:04-cv-01724- JLK-MEH," filed in the U.S. District Court for the District of Colorado under John L. Kane, with referral to Judge Michael E. Hegarty. It alleged plaintiffs were fired for complaining about racial discrimination, receiving lower pay and fewer benefits than white workers. In 2005, the workers filed a second suit "Woods et al. v. Ampco System Transportation, Inc., Case No. 1:05-cv-02040-PSF-MEH," in the U.S. District Court for the District of Colorado under Judge Phillip S. Figa. The second suit seeks to have the suit certified as a class action representing about 400 current and former bus drivers and lot supervisors. Both suits claimed Ampco failed to pay the workers the city's "prevailing wages" they were entitled to. Ampco denied the claims in both suits and asked that they be dismissed. A judge did not rule on either suit prior to the settlement. Terms of the settlement in the wage and discrimination lawsuits were not disclosed. A copy of the October 2005 complaint is available for free at: http://ResearchArchives.com/t/s?f4a Representing the defendant is Susan Strebel Sperber of Rothgerber, Johnson & Lyons, LLP-Denver, 1200 Seventeenth Street One Tabor Center, #3000, Denver, CO 80202-5855, Phone: 303-628- 9563, Fax: 303-623-9222, E-mail: ssperber@rothgerber.com. Representing the plaintiffs are Gregory Alan Hall of Gregory A. Hall Law Office, P.O. Box 202922, Denver, CO 80220-8922, Phone: 303-320-0584, Fax: 303-370-6922, E-mail: gregory@federallaw.com; and Anne Thomas Sulton of the Sulton Law Offices, P.O.Box 2763 Olympia, WA 98507, Phone: 609-468-6029, E-mail: annesulton@comcast.net. AQUILA INC: August 2007 Trial Slated for ERISA Litigation in Mo. ---------------------------------------------------------------- The U.S. District Court for the Western District of Missouri set a tentative August 2007 trial for the consolidated class action, "In re Aquila ERISA Litigation" which is seeking recovery from the company more than $150 million in alleged retirement losses. On Sept. 24, 2004, a lawsuit was filed in the U.S. District Court for the Western District of Missouri against the company and certain members of the company's board of directors and management, alleging that they violated the Employee Retirement Income Security Act and were responsible for losses that participants in the company's 401(k) plan experienced as a result of the decline in the value of their Aquila common stock held in the 401(k) plan. A number of similar lawsuits alleging that the defendants breached their fiduciary duties to the plan participants in violation of ERISA by concealing information and/or misleading employees who held the company's common stock through the company's 401(k) plan were subsequently filed against the company. The suits also seek damages for the plan's losses resulting from the alleged breaches of fiduciary duties. On Jan. 26, 2005, the court ordered that all of these lawsuits be consolidated into a single case captioned, "In re Aquila ERISA Litigation." The plaintiffs filed an amended consolidated complaint in March 2005, which largely repeats each of the allegations in the first complaint. This case has been certified as a class action and set for trial in August 2007. The suit is "Itteilag v. Aquila, Inc. et al., Case No. 4:04-cv- 00865-DW," filed in the U.S. District Court for the Western District of Missouri under Judge Dean Whipple. Representing the plaintiffs are: (1) Michael Jaffe of Wolf Haldenstein Adler Freeman & Herz, LLP, 270 Madison Avenue, New York, NY 10016, US, Phone: (212) 545-4600; and (2) Bruce Keplinger of Norris & Keplinger, LLC, 6800 College Blvd., Suite 630, Overland Park, KS 66211, Phone: (913) 323-3185 and Fax: (913) 663-2006, E-mail: bkeplinger@k-c-lawyers.com. Representing the company is Stanley Daryl Davis of Shook Hardy & Bacon LLP, 2555 Grand Boulevard, Kansas City, MO 64108-2613, Phone: (816) 474-6550, Fax: (816) 421-4066, E-mail: sddavis@shb.com. BMO NESBITT: Faces $100M Lawsuit Over Retirement Savings Plans -------------------------------------------------------------- James R. MacDonald, on behalf of a class of individuals, initiated a class action against BMO Nesbitt Burns Inc., BMO Trust Co. and BMO Bank of Montreal in respect of foreign exchange transactions in Registered Retirement Savings Plans, Registered Retirement Income Funds or Registered Education Savings Plans accounts. The proposed class includes all present and former clients of the defendants who held or hold RRSP(s), RRIF(s) or RESP(s) and who, since June 14, 2001, have incurred foreign currency conversion charges in these accounts. The statement of claim alleges that the defendants have systematically converted foreign currency in these accounts to Canadian currency without instructions from the customers, and without there being any need to do so, based upon revisions to the Income Tax Act that came into effect on June 14, 2001. In effecting all currency conversions, the defendants levy an undisclosed conversion fee in addition to the amount that they actually pay to buy or sell currency. The statement of claim alleges that the defendants failed to change their operational practices after the change to the Income Tax Act, which allows RRSPs, RRIFs and RESPs to hold foreign currency as an investment. It further alleges that the reason for the defendants' failure to effect a change was so that they could continue to earn profits from the foreign exchange fees, at the expense of the class members. It seeks damages for all the fees charged in association with the unauthorized conversion of foreign currency to Canadian funds since the change to the Income Tax Act became effective. It also seeks repayment of all the hidden foreign exchange fees levied by the defendants on transactions where the customer did authorize a conversion of funds from Canadian to a foreign currency; but had no notice and did not agree to payment of the hidden fee. Each time a foreign exchange fee is charged by the defendants it depletes the funds in the customer's retirement or education fund, the plaintiff said. The plaintiff is claiming $100 million in damages, a permanent injunction prohibiting the defendants from conducting unauthorized foreign exchange transactions and a permanent injunction prohibiting the defendants from charging undisclosed fees on any foreign exchange transactions, punitive damages of $10 million. The proposed class is all current and former clients of the defendants resident in Canada, who held one or more trust account(s) administered by BMO Trust and/or Nesbitt and who, between June 14, 2001 and the date of certification of this action as a class proceeding, purchased or sold investments denominated in foreign currency in their trust account(s) or were paid dividends or interest in a foreign currency in their trust account(s) or otherwise held foreign currency into their trust account(s), which was then converted to Canadian dollars by the defendants. This proposed class action is proceeding on a contingency fee basis. A copy of Mr. MacDonald's Claim is available for free at: http://ResearchArchives.com/t/s?f3c The case is Court File No. 06-CV-316213 CA filed in the Ontario Superior Court of Justice. Representing the plaintiffs are Margaret Waddell or Odette Soriano both of Paliare Roland Rosenberg Rothstein LLP, 250 University Avenue, Suite 501, Toronto ON, M5H 3E5, Phone: 1-888- 569-4526, E-mail: info@rrspclassaction.com, Website: http://www.rrspclassaction.com. CYNOSURE INC: Faces TCPA Suit in Mass. Over Unsolicited Faxes ------------------------------------------------------------- Cynosure, Inc. is a defendant in a purported class action filed in Massachusetts state court over allegations it violated Telephone Consumer Protection Act. In May 2005, Dr. Ari Weitzner, individually and as putative representative of a purported class, filed a lawsuit against the company under the TCPA. The lawsuit alleges that the company violated the TCPA by sending unsolicited advertisements by facsimile. Although the company is continuing to investigate the number of facsimiles transmitted during the period for which the plaintiff in the lawsuit seeks class certification, and the number of these facsimiles that were "unsolicited" within the meaning of the TCPA, the company expects the number of unsolicited facsimiles to be very large. Westford, Massachusetts-based Cynosure, Inc. (NASDAQ: CYNO) -- http://www.cynosurelaser.com/-- develops, manufactures and markets treatment systems, which are used by physicians and other practitioners to perform non-invasive procedures to remove hair, treat vascular lesions, rejuvenate skin through the treatment of shallow vascular lesions and pigmented lesions, and temporarily reduce the appearance of cellulite. The company markets and sells its products to the dermatology, plastic surgery and general medical markets, domestically and internationally. EASTMAN KODAK: Files Motion to Dismiss N.Y. Stock Fraud Suit ------------------------------------------------------------ Parties in the consolidated securities class action in the U.S. District Court for the Western District of New York against Eastman Kodak Co. and two of its former executives have filed new motions in the case. On Jun. 13, 2005, a purported shareholder class action was filed against the company in the U.S. District Court for the Southern District of New York. On Jun. 20, 2005 and Aug. 10, 2005, similar lawsuits were filed against the same defendants in the U.S. District Court for the Western District of New York. The cases have been consolidated in the Western District of New York and the lead plaintiffs are John Dudek and the Alaska Electrical Pension Fund. The complaints filed in each of these actions seek to allege claims under the U.S. Securities Exchange Act on behalf of a proposed class of persons who purchased securities of the company between Apr. 23, 2003 and Sept. 25, 2003, inclusive. The substance of the complaints is that various press releases and other public statements made by the company during the proposed class period allegedly misrepresented the company's financial condition and omitted material information regarding, among other things, the state of the company's film and paper business. An amended complaint was filed on Jan. 20, 2006, containing essentially the same allegations as the original complaint but adding an additional named defendant. Defendants' motion to dismiss was filed on Apr. 21, 2006. Plaintiff's memorandum in opposition was filed on June 23, 2006 and the company's reply was filed on July 24, 2006. The suit is "McClain v. Eastman, Case No. 6:05-cv-06326-MAT," filed in the U.S. District Court for the Western District of New York under Judge Michael A. Telesca. Representing the plaintiffs are: (1) Stuart Berman of Schiffrin & Barroway, LLP, 280 King of Prussia Road, Radnor, PA 19087, US, Phone: 610-667- 7706; (2) Eugene Welch of Harris, Chesworth, O'Brien, Johnstone, Welch & Leone, 300 Linden Oaks, Ste. 100, Rochester, NY 14625, Phone: 585-899-1400, Fax: 585-899-1426, E-mail: ewelch@rochester.rr.com; and (3) Samuel H. Rudman of Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, 200 Broadhollow Road, Suite 406, Melville, NY 11747, Phone: 631-367-7100. Representing the defendants are: (i) Carolyn G. Nussbaum of Nixon Peabody, LLP, Clinton Square, P.O. Box 31051, Rochester, NY 14603, Phone: (585) 263-1558, Fax: 866-947-0625, E-mail: cnussbaum@nixonpeabody.com; and (ii) John C. Millian of Gibson, Dunn & Crutcher, LLP, 1050 Connecticut Avenue, N.W. Washington, DC 20036, Phone: (202) 955-8213. FIFTH THIRD: Named in Payment Card Interchange Fee Suit in N.Y. --------------------------------------------------------------- Fifth Third Bancorp is a defendant in a consolidated antitrust class action, "In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, MDL-1720, Case No. 1:05-md-01720- JG-JO," which was filed in the U.S. District Court for the Eastern District of New York. On April 26, 2006, the company was added as a defendant in the consolidated lawsuit, which was originally filed against Visa, MasterCard and several other major financial institutions. The plaintiffs, merchants operating commercial businesses throughout the U.S. and trade associations, claim that the interchange fees charged by card-issuing banks are unreasonable and seek injunctive relief and unspecified damages. The suit is "In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, MDL-1720, Case No. 1:05-md-01720- JG-JO," filed in the U.S. District Court for the Eastern District of New York under Judge John Gleeson with referral James Orenstein. Representing the plaintiffs: (1) Darla Jo Boggs of Lockridge Grindal Nauen, P.L.L.P., 100 Washington Avenue South, Suite 2200, Minneappolis, MN 55401, US, Phone: 612-339-6900, Fax: 612-339-0981, E-mail: djboggs@locklaw.com; (2) Christopher M. Burke of Lerach Coughlin Stoia Geller Rudman & Robbins, 655 W. Broadway, Suite 1900, San Diego, CA 92101, US, Phone: 619-231-1058, Fax: 619-231- 7423, E-mail: chrisb@lerachlaw.com; and (3) Jason S. Cowart of Pomerantz Haudek Block Grossman & Gross, LLP, 100 Park Avenue, 26th Floor, New York, NY 10017, Phone: 212-661-1100, Fax: 212-661-8665, E-mail: jasoncowart@yahoo.com. Representing the company is Patrick F. Fischer of Keating Muething & Klekamp, PLL, One East Fourth Street, Suite 1400, Cincinnati, OH 45202, Phone: 513-579-6400, Fax: 513-579-6457, E- mail: pfischer@kmklaw.com. HERCULES INC: Court Mulls Appeal on Dismissal of Dioxin Lawsuit --------------------------------------------------------------- The U.S. Court of Appeals for the Second Circuit has yet to rule on plaintiffs' appeal on the dismissal of their class action, "The Vietnam Association for Victims of Agent Orange/Dioxin, et al. v. The Dow Chemical Co., et al., Case No. 04-0400." In January 2004, Hercules, Inc., along with several other companies were sued in a purported class action filed in the U.S. District Court for the Eastern District of New York by The Vietnam Association for Victims of Agent Orange/Dioxin and several individuals who claim to represent between two and four million Vietnamese who allege that Agent Orange used by the U.S. during the Vietnam War caused them or their families to sustain personal injuries. The suit alleges violations of international law and war crimes, as well as violations of the common law for products liability, negligence and international torts. The defendants moved to dismiss the case on several grounds, including failure to state a claim under the Alien Tort Claims Statute, lack of jurisdiction and justiciability, the bar of the statute of limitations, failure to state claims for violations of international law, and the "government contractor defense." A hearing on these motions was held on Feb. 28, 2005. By order dated March 10, 2005, the court dismissed the lawsuit. Plaintiffs though have appealed that dismissal to the U.S. Court of Appeals for the Second Circuit. The suit is "Vietnam Association for Victims of Agent Orange/Dioxin, et al. v. Dow Chemical Co., et al.," on appeal from the U.S. District Court for the Eastern District of New York under Judge Jack B. Weinstein with referral to judge Joan M. Azrack. Representing the plaintiffs are: (1) Mary Ellen Bates of Hardin, Nomberg & Bates, LLP, 2151 Highland Ave., Suite 120, Birmingham, Al 35205, Phone: 205-930-690; and (2) Richard Bress Latham & Watkins, LLP, 555 Eleventh Street N.W., Suite 1000, Washington, DD 20004, Phone: 202-637-2137, E-mail: rick.bress@lw.com. Representing the defendants are: (i) Steven R. Brock of Rivkin Radler, LLP, EAB Plaza, 10th Floor, Uniondale, NY 11556-0111, Phone: 516-357-3315, Fax: 516-357-3333, E-mail: steve.brock@rivkin.com; and (ii) Chryssa V.B. Valletta of McDermott, Will, Emery, 50 Rockefller Plaza, New York, NY 10020, Phone: 212-547- 5400, Fax: 212-547-5444, E-mail: cvalletta@mwe.com. HERCULES INC: Court Yet to Approve $1.4M Deal in Ga. Gulf Suit -------------------------------------------------------------- The 18th Judicial District Court, Parish of Iberville, Louisiana has to grant final approval to the $1,412,000 settlement in class actions against Hercules, Inc. and other defendants over the contamination of potable water supply at Georgia Gulf. The company is one of several defendants that were sued by over 2,000 individuals in a series of lawsuits, including purported class actions that were all brought in the 18th Judicial District Court, Parish of Iberville, Louisiana, under the captions: -- "Jerry Oldham, et al. v. The State of Louisiana, et al., Civil Action No. 55,160"; -- "John Capone, et al. v. The State of Louisiana, et al., Civil Action No. 56,048C"; and -- "Georgenner Batton, et al. v. The State of Louisiana, et al., Civil Action No. 55,285." The purported class members and plaintiffs, who claimed to have worked or lived at or around the Georgia Gulf facility in Iberville Parish, Louisiana, alleged injury and fear of future illness from the consumption of contaminated water and, specifically, elevated levels of arsenic in that water. As to the company, plaintiffs alleged that the company itself and as part of a joint venture operated a nearby plant and, as part of those operations, used a groundwater injection well to dispose of various wastes, and that those wastes contaminated the potable water supply at Georgia Gulf. In August 2005, the company and several other defendants entered into an agreement to settle these matters with the company agreeing to pay $1,412,000 (Class Action Reporter, March 17, 2006). On May 4, 2006, the court granted settlement class certification. This settlement, which was agreed to by the company without any admission of liability, is pending final approval by the court. Wilmington, Delaware-based Hercules Inc. (NYSE: HPC) -- http://www.herc.com/-- is a manufacturer and marketer of specialty chemicals and related services for a range of business, consumer and industrial applications. Its principal products include chemicals used by the paper industry, water- soluble polymers, polypropylene fibers and polypropylene / polyethylene bicomponent fibers, and specialty resins. HERCULES INC: Plaintiffs Appeal Dismissal of Agent Orange Suits --------------------------------------------------------------- Plaintiffs are appealing the dismissal by the U.S. District Court for the Eastern District of New York of 23 lawsuits, including two purported class actions filed against Hercules, Inc. Plaintiffs filed the suits, alleging that exposure to Agent Orange caused them to sustain various personal injuries. On Feb. 9, 2004, the court issued a series of rulings granting several motions filed by defendants in the two cases that had been remanded to the U.S. District Court by the U.S. Court of Appeals for the Second Circuit on remand from the U.S. Supreme Court, namely: -- "In re: Agent Orange Product Liability Litigation: Joe Isaacson, et al. v. Dow Chemical Co., et al., (MDL 381, CV 98-6383 (JBW))"; and -- "Daniel Ray Stephenson, et al. v. Dow Chemical Co., et al., Case No. CV 99-3056 (JBW)." In relevant part, those rulings held that plaintiffs' claims against the defendant manufacturers of Agent Orange are properly removable to federal court under the "federal officer removal statute" and that such claims are subject to dismissal by application of the "government contractor defense." The court then dismissed plaintiffs' claims, but stayed its decision to allow plaintiffs to obtain additional discovery and to move for reconsideration of the court's decision. A hearing on the motion for reconsideration was held on Feb. 28, 2005. By orders dated March 2, 2005, the court denied reconsideration, lifted the stay of the earlier decision, and dismissed plaintiffs' claims in all 23 pending lawsuits. Plaintiffs have appealed those dismissals to the U.S. Court of Appeals for the Second Circuit. Wilmington, Delaware-based Hercules Inc. (NYSE: HPC) -- http://www.herc.com/-- is a manufacturer and marketer of specialty chemicals and related services for a range of business, consumer and industrial applications. Its principal products include chemicals used by the paper industry, water- soluble polymers, polypropylene fibers and polypropylene / polyethylene bicomponent fibers, and specialty resins. HERCULES INC: Settles Carbon Fiber Litigation in Calif., Mass. -------------------------------------------------------------- Hercules, Inc. settled several purported class actions in both state and federal courts in Massachusetts and California over the pricing and sale of carbon fiber products. Commencing in 1999, the company was one of several companies sued in a series of civil antitrust and related lawsuits concerning the pricing and sale of carbon fiber and carbon prepreg products, together referred to as "carbon fiber products." These products were manufactured and sold by the company's former Composite Products division, which division was sold to Hexcel Corp. in 1996. These lawsuits encompassed: -- a federal class action brought on behalf of direct purchasers of carbon fiber products captioned, "Thomas & Thomas Rodmakers v. Newport Adhesives and Composites, Case No. CV-99-07796-GHK (CTx)," filed in the U.S. District Court for the Central District of California; -- a total of nine California state purported class actions brought on behalf of indirect purchasers of carbon fiber products, all consolidated under the caption, "Carbon Fiber Cases I, II, and III, Judicial Council Coordination Proceeding Nos. 4212, 4216 and 4222," filed in the Superior Court of California, County of San Francisco; -- a Massachusetts state purported class action brought on behalf of indirect purchasers of carbon fiber products captioned, "Saul M. Ostroff, et al. v. Newport Adhesives, et al., Civil Action No. 02-2385," filed in the Superior Court of Middlesex County; and -- a lawsuit brought by Horizon Sports Technologies, a company that had "opted out" of the federal class action referred to above and captioned, "Horizon Sports Technologies, Inc. v. Newport Adhesives and Composites, Inc., et al., Case No. CV02-8126 FMC (RNEX)," filed in the U.S. District Court for the Central District of California. Throughout 2005, the company entered into agreements to resolve each of the foregoing lawsuits, and the results of such settlements have been reflected in the company's financial statements. At this time, all of the forgoing lawsuits have been resolved, and all payments have been made, without any admission of liability. The company entered each of the settlements into in order to avoid the risks, uncertainties and costs inherent in litigation. Wilmington, Delaware-based Hercules Inc. (NYSE: HPC) -- http://www.herc.com/-- is a manufacturer and marketer of specialty chemicals and related services for a range of business, consumer and industrial applications. Its principal products include chemicals used by the paper industry, water- soluble polymers, polypropylene fibers and polypropylene / polyethylene bicomponent fibers, and specialty resins. INTERPOOL INC: N.J. Court Approves Securities Suit Settlement ------------------------------------------------------------- The U.S. District Court for the District of New Jersey approved a $1 million settlement of the consolidated securities class action filed against Interpool, Inc. and certain of its present and former executive officers and directors as defendants. In February and March 2004, several lawsuits were filed in the U.S. District Court for the District of New Jersey. The complaints alleged violations of the federal securities laws relating to the company's reported Consolidated Financial Statements for the years ended Dec. 31, 2000 and 2001 and the nine months ended Sept. 30, 2002, which the company announced in March 2003 would require restatement. Each of the complaints purported to be a class action brought on behalf of persons who purchased securities during a specified period. In April 2004, the lawsuits, which seek unspecified amounts of compensatory damages and costs and expenses, including legal fees, were consolidated into a single action with lead plaintiffs and lead counsel having been appointed. The plaintiffs filed a consolidated amended complaint in September 2004, which included allegations of purported misstatements and omissions in public disclosures throughout an expanded purported class period from March 31, 1999 through December 26, 2003. In November 2004, the company filed a motion to dismiss the amended complaint. The motion to dismiss was granted by the District Court on Aug. 18, 2005, dismissing the plaintiffs' claims in their entirety and with prejudice. On Sept. 19, 2005, the plaintiffs filed a notice of appeal of the dismissal order, thereby initiating a review of the District Court's decision by the U.S. Court of Appeals for the Third Circuit. In view of the costs and uncertainties described above and which are inherent in the litigation process, the company elected to participate in the Third Circuit's mediation program through which a settlement of this litigation was negotiated. Following the conclusion of these negotiations, the company received a letter dated Dec. 8, 2005 from the Director of the Appellate Mediation Program for the U.S. Court of Appeals for the Third Circuit, confirming the settlement terms for this class action litigation, to which all parties have agreed, which are: -- a cash payment on behalf of defendants in the total amount of $1.0 million, inclusive of all of the fees and expenses of plaintiffs' counsel; and -- the dismissal of all claims against the company and the other defendants on a class-wide basis. The company's insurance carrier will fund the entire $1,000 payment. The agreed settlement terms have been embodied in a formal settlement agreement that has been submitted to the U.S. District Court for the District of New Jersey. The Court of Appeals remanded the case to the District Court for consideration of the settlement and on Aug. 1, 2006, held a fairness hearing with respect to the settlement where the judge announced in an oral ruling that the settlement had been approved and will be followed by a written order shortly. The suit is "Hurtado, et al. v. Interpool, Inc., et al., Case No. 3:04-cv-00321-SRC-TJB," filed in the U.S. District Court for the District of New Jersey under Judge Stanley R. Chesler with referral to Judge Tonianne J. Bongiovanni. 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) Lisa J. Rodriguez of Trujillo Rodriguez & Richards, LLP, 8 Kings Highway West, Haddonfield, NJ 08033, Phone: (856) 795-9002, E-mail: lisa@trrlaw.com; and (3) Daniel S. Sommers of Cohen, Milstein, Hausfeld & Toll, PLLC, Suite 500 West, 1100 New York Avenue, NW Washington, DC 20005, Phone: (202) 408-4600, E-mail: dsommers@cmht.com. Representing the company are: (i) Matthew M. Oliver of Lowenstein Sandler, 65 Livingston Avenue, Roseland, NJ 07068, E-mail: moliver@lowenstein.com. (ii) David A. Kotler of Dechert, LLP, Princeton Pike, Corporate Center, P.O. BOX 5218, Princeton, NJ 08543, Phone: 609-620-3200, E-mail: david.kotler@dechert.com. KEYSPAN CORP: Sued Over Operations at Former Bay Shore Gas Plant ---------------------------------------------------------------- Keyspan Corp. is facing a purported class action alleging damages resulting from contamination associated with the company's operations of the former manufactured gas plant in Bay Shore, New York. Based in New York, Keyspan Corp. -- http://www.keyspanenergy.com -- is a holding company under the Public Holding Co. Act of 2005. It operates six regulated utilities that distribute natural gas to approximately 2.6 million customers in New York City, Long Island, Massachusetts and New Hampshire, making KeySpan the fifth largest gas distribution company in the U.S. and the largest in the Northeast. MASTEC INC: Fla. Court Sets Hearing for $10M Stock Settlement ------------------------------------------------------------- The U.S. District Court for the Southern District of Florida set an Aug. 15, 2006 preliminary approval hearing for the $10 million settlement in the consolidated securities class action against MasTec, Inc. and certain of its officers. In the second quarter of 2004, purported class action complaints were filed against the company in the U.S. District Court for the Southern District of Florida and in the U.S. District Court for the Southern District of New York. These cases have been consolidated by court order in the Southern District of Florida. The complaints allege certain violations of Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, as amended, related to current and prior period earnings reports. On Jan. 25, 2005, a motion for leave to file a second amended complaint was filed by plaintiffs, which the court granted. Plaintiffs filed their second amended complaint on Feb. 22, 2005. Plaintiffs contend that the company's financial statements during the purported class period of Aug. 12, 2003 to May 11, 2004 were materially misleading in these areas: (1) the financials for the third quarter of 2003 were allegedly overstated by $5.8 million in revenue from unapproved change orders from a variety of the company's projects; and (2) the financials for the second quarter of 2003 were overstated by some $1.3 million as a result of the intentional overstatement of revenue, inventories and work in progress at the company's Canadian subsidiary. Plaintiffs seek damages, not quantified, for the difference between the stock price plaintiffs paid and the stock price plaintiffs believe they should have paid, plus interest and attorney fees. The company filed a motion to dismiss that was denied on Sept. 30, 2005. In April 2006, the company settled the lawsuit for $10 million in cash. On June 30, 2006, the parties executed a Stipulation of Settlement and filed a Joint Motion for Preliminary Approval of the settlement of the federal securities class action. The settlement is contingent upon final court approval. The court scheduled a preliminary hearing on the approval of the settlement for Aug. 15, 2006. The suit is "In Re: MasTec, Inc. Securities Litigation, Case No. 04-CV-20886, filed in the U.S. District Court for the Southern District of Florida under Judge Federico A. Moreno. Representing the plaintiffs are: (1) Bernstein Litowitz Berger & Grossmann LLP (New York, NY), 1285 Avenue of the Americas, 33rd Floor, New York, NY, 10019, Phone: 212-554-1400, Fax: 212-554-1444, E- mail: blbg@blbglaw.com; (2) Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, (Boca Raton), 197 South Federal Highway, Suite 200, Boca Raton, FL, 33432, Phone: 561-750-3000, Fax: 561- 750-3364, E-mail: info@lerachlaw.com; (3) Vianale & Vianale, LLP, The Plaza - Suite 801, 5355 Town Center Road, Boca Raton, FL, 33486, Phone: 561- 391-4900, Fax: 561-368-9274, E-mail: info@vianalelaw.com; and (4) Yourman Alexander & Parekh, LLP, 3601 Aviation Blvd., Suite 3000, Manhattan Beach, CA, 90266, Phone: 310-725- 6400, Fax: 310-725-6420. MICROSOFT CORP: Faces Suits in Wash. Over WGA Anti-Piracy Tool -------------------------------------------------------------- Microsoft Corp. is facing two federal lawsuits over its Windows Genuine Advantage (WGA) anti-piracy tool, alleging that the company is violating laws that seek to combat spyware, the English Business News reports. The purported class actions were both filed in the U.S. District for the Western District of Washington, under the captions: -- "Johnson v. Microsoft Corp., Case No. 2:06-cv- 00900-MJB, (filed on June 26, 2006);" and -- "Engineered Process Controls LLC et al v. Microsoft Corp., Case No. 2:06-cv-00927-JLR, (filed on June 30, 3006)." According to the suits, since WGA gathers data that can easily identify individual PCs and could potentially be used to gather other types of information, it is akin to malicious threats. In so doing, the suit claims that the program violates Washington's anti-spyware laws (Class Action Reporter, July 10, 2006). WGA is an anti-piracy tool designed to check the validity of a computer user's copy of the Windows operating system. It recently became the subject of controversy, after PC users discovered that WGA was contacting the company's servers on a daily basis without their knowledge. This allegedly happened even if a users' software was legitimate (Class Action Reporter, July 3, 2006). Microsoft introduced the piracy check in mid-2005 as a condition for downloading security fixes and other software, such as anti- spyware technology, from its Web site. But, some say the company clumsily handled several elements of the program, including a key privacy issue. The lawsuits allege that the company pushes it to all Windows PCs, whether they have Automatic Updates turned on or not. In effect the company installed the WGA software on consumers' systems without providing consumers any opportunity to make an informed choice about that software. Further, the suits -- both seeking unspecified damages -- contend that the anti-piracy tool amounts to a form of spyware and that the company misled users by labeling WGA as a critical security update without telling them that it would secretly communicate with its servers. Microsoft spokesman Jim Desler insists the piracy check is not spyware and that the lawsuits are without merit and distorts the objective of their anti-piracy program. However, Marc Rotenberg, executive director of the Electronic Privacy Information Center, argued the concern is that users did not know about or control the interaction. He said it's very much like a digital trespass -- someone getting access to your system without your consent. Microsoft conceded that it should have told users it was making the daily connection. It has since discontinued the daily check and revised its disclosures. The system will, however, continue to occasionally check in with Microsoft to make sure it still believes a person's software is legitimate. The named plaintiff in the June 26 lawsuit is Los Angeles resident Brian Johnson, while in the June 30 case the plaintiffs were: -- Engineered Process Controls, LLC; -- Univex, Inc.; -- David DiDomizio, individual end user; -- Edward Misfud, individual end user; and -- Martin Sifuentes, individual end user. For more details, contact: (1) [Engineered - Plaintiffs] David Elliot Breskin of Short Cressman & Burgess, 999 3rd Ave., Ste. 3000, Seattle, WA 98104-4088, Phone: 206-682-3333, Fax: 340-8856, E- mail: dbreskin@scblaw.com; (2) [Engineered - Plaintiffs] William W. Houck of Law Offices of William W. Houck, 4045 262ND Ave., SE Issaquah, WA 98029, Phone: 425-392-7118, E-mail: houck@houcklaw.com; (3) [Johnson - Plaintiff] Mitchell A. Broz and Jess Gilbert Webster of Mikkelborg Broz Wells & Fryer, 1001 4th Ave., Ste. 3600, Seattle, WA 98154-1115, Phone: 206- 623-5890, Fax: 206-623-0965, E-mail: mbroz@mbwf.com and jgwebster@mbwf.com. MINNESOTA: Judge Allows Lawsuit Against Airports Commission ----------------------------------------------------------- Hennepin County District Judge Stephen Aldrich has allowed a class action filed by Minneapolis and Richfield homeowners against the operator of Minneapolis-St. Paul International Airport, according to Associated Press. The residents accuse the Metropolitan Airports Commission of reneging in its promise to install noise protection for more homes under airplane flight paths. The potential class in the suit includes at least 3,500 homes around the airport. The plaintiffs are seeking more than $140 million in additional money for noise-proofing their homes near the Minneapolis-St. Paul International Airport. The lawsuit seeks full noise insulation, at a cost of over $157 million. A trial is set for February. Representing the plaintiffs is attorney Robert Moilanen at Zimmerman Reed, P.L.L.P., 651 Nicollet Mall, Suite 501 Minneapolis, Minnesota 55402 (Hennepin Co.), Phone: 612-341- 0400, Toll Free: 800-755-0098, Fax: 612-341-0844. MOLEX INC: Discovery Continues in Ill. Securities Fraud Suit ------------------------------------------------------------ Discovery is ongoing in the consolidated securities fraud class action pending in the U.S. District Court for the Northern District of Illinois against Molex, Inc. and certain of its officers and employees. Between March 2, 2005 and April 22, 2005, seven separate complaints were filed -- each purporting to be on behalf of a class of Molex shareholders -- against the company, and certain of its officers and employees. The shareholder actions have been consolidated before Judge Ruben Castillo in the case, "The Takara Trust v. Molex Inc., et al., Case No. 05C 1245," which is pending in the U.S. District Court for the Northern District of Illinois. The consolidated amended complaint alleges, among other things, that from July 27, 2004 to Feb. 14, 2005, the named defendants made or caused to be made a series of materially false or misleading statements about the company's business, prospects, operations, and financial statements which constituted violations of Section 10(b) of the U.S. Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder and Section 20(a) of the Exchange Act. The complaint also alleges that certain of the named defendants engaged in insider trading in violation of Section 10(b) and Rule 10b-5. As relief, the complaint seeks, among other things, a declaration that the action be certified as a proper class action, unspecified compensatory damages, including interest, and payment of costs and expenses, including fees for legal counsel and experts. The individual defendants named in the consolidated amended complaint are: -- J. Joseph King, -- Diane S. Bullock, -- John H. Krehbiel Jr., -- Frederick A. Krehbiel and -- Martin P. Slark. On April 28, 2006, the court denied defendants' motion to dismiss the complaint. On July 6, 2005, the court appointed City of Pontiac Group, Joan L. Weeks individually and as trustee, and James Baker as lead plaintiffs, and approved lead plaintiffs' choice of lead counsel. Discovery is ongoing, and is scheduled to conclude in March 2007. The suit is "The Takara Trust v. Molex Incorporated, et al., Case No. 05C 1245," filed in the U.S. District Court for the Northern District of Illinois under Judge Ruben Castillo. Representing the plaintiffs are: (1) Carol V. Gilden of Much, Shelist, Freed, Denenberg, Ament & Rubenstein, P.C., 191 North Wacker Drive, Suite 1800, Chicago, IL 60605-1615, Phone: (312) 521-2403, Fax: (312) 521-2100, E-mail: cgilden@muchshelist.com; and (2) Marc A. Topaz of Schiffrin & Barroway, LLP, 280 King of Prussia Road, Radnor, PA 19087, Phone: (610) 667-7706. Representing the defendants are Harold C. Hirshman, Jason L. Rubin, Christopher Qualley King and Gerald E. Fradin of Sonnenschein, Nath & Rosenthal, LLP, 233 South Wacker Drive, 8000 Sears Tower, Chicago, IL 60606, Phone: (312) 876-8000, E- mail: cking@sonnenschein.com and gfradin@sonnenschein.com. NORTHERN STATES: Seeks Dismissal of Consumer Fraud Suit in Minn. ---------------------------------------------------------------- The Minnesota state district court in Hennepin County is set to hear on Aug. 16, 2006, a motion to dismiss a purported consumer class action, "Hoffman vs. Northern States Power Co.," which was filed against Northern States Power Co., a wholly owned subsidiary of Xcel Energy, Inc. Filed on Mar. 15, 2006, the complaint was brought on behalf of NSP-Minnesota's residential customers in Minnesota, North Dakota and South Dakota for alleged breach of a contractual obligation to maintain and inspect the points of connection between NSP- Minnesota's wires and customers' homes within the meter box. Plaintiffs claim NSP-Minnesota's breach results in an increased risk of fire and that it is in violation of tariffs on file with the Minnesota Power Utilities Commission. They thus seek injunctive relief and damages in an amount equal to the value of inspections plaintiffs claim NSP-Minnesota was required to perform over the past six years. NSP-Minnesota has filed a motion for dismissal on the pleadings, which is to be heard on Aug. 16, 2006. Minneapolis, Minnesota-based Xcel Energy, Inc. (NYSE: XEL) -- http://www.xcelenergy.com/-- is a holding company engaged in the utility business in the U.S. Through its subsidiaries, it is engaged in the generation, purchase, transmission, distribution and sale of electricity. Xcel Energy is also involved in the purchase, transportation, distribution and sale of natural gas. The company's regulated wholly owned utility subsidiaries include Northern States Power Co. (NSP-Minnesota), Northern States Power Co. (NSP-Wisconsin), Public Service Co. of Colorado (PSCo) and Southwestern Public Service Co. (SPS). These utility subsidiaries serve electric and natural gas customers in portions of Colorado, Kansas, Michigan, Minnesota, New Mexico, North Dakota, Oklahoma, South Dakota, Texas and Wisconsin. NORTHWESTERN CORP: Agrees to Settle S.D. Livonia Employees Suit --------------------------------------------------------------- NorthWestern Corp. d/b/a NorthWestern Energy reached a memorandum of understanding to settle the putative shareholder class action and derivative lawsuit pending against it in the U.S. District Court for the District of South Dakota. In November 2005, the company and its directors were named as defendants in a shareholder class action and derivative action, "City of Livonia Employee Retirement System v. Draper, et al." The plaintiff claims, among other things, that the directors breached their fiduciary duties by not sufficiently negotiating with Montana Public Power Inc. and Black Hills Corp., two entities that had made public, unsolicited offers to purchase the company. On April 26, 2006, Livonia amended its complaint to add allegations that the company's directors had erred in choosing the Babcock & Brown Infrastructure Limited offer, since it was not the most attractive offer they had received for the company. The parties have entered into a memorandum of understanding to settle the claims of the plaintiff class. Under the terms of the MOU, the company will redeem the existing shareholder rights plan either following shareholder approval of the merger agreement with BBI or upon termination of the merger agreement with BBI, whichever occurs first. The board may adopt a new shareholder rights plan if the shareholders approve adoption of such a plan in advance or, in the event that circumstances require timely implementation of such a plan, the board seeks and receives approval from shareholders within 12 months after adoption. After limited confirmatory discovery, the parties plan to present a settlement agreement to the federal court for preliminary approval. Once received, notice will be sent to all class members informing them of the terms of the settlement, their right to object and notice of the final hearing to approve the settlement. The plaintiffs' lawyers will also have the right to seek an award of attorneys' fees from the federal court at which the company would object to any such award. Once approved, the lawsuit filed by the City of Livonia Employees' Retirement System would be dismissed. The suit is "City of Livonia Employees' Retirement System v. Draper, et al., Case No. 4:05-cv-04178-LLP," filed in the U.S. District Court for the District of South Dakota under Judge Lawrence L. Piersol. Representing the plaintiffs are: (1) Randall J. Baron and Darren J. Robbins of Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, 655 W. Broadway, Suite 1900, San Diego, CA 92101, Phone: (619) 231-1058, Fax: 231-7423; and (2) Timothy J. Dougherty of Dougherty & Dougherty, P.O. Box 1004, Sioux Falls, SD 57101-1004, Phone: 335-8586. Representing the defendants are: (i) Filiberto Agusti, Scott T. Bielicki, David F. Rifkind and Andrew Sloniewsky of Steptoe and Johnson, LLP, 1330 Connecticut Ave., NW Washington, DC 20036, US, Phone: 202-429-6428, 202-429-6751, 202-429-8094 and 202-429- 6759, E-mail: fagusti@steptoe.com, sbielicki@steptoe.com, drifkind@steptoe.com and asloniewsky@steptoe.com; and (ii) Roberto Antonio Lange of Davenport, Evans, Hurwitz & Smith, P.O. Box 1030, Sioux Falls, SD 57101-1030, Phone: 336-2880, Fax: 335-3639, E-mail: rlange@dehs.com. NPS PHARMACEUTICALS: Faces Securities Suits in Utah Over PREOS -------------------------------------------------------------- NPS Pharmaceuticals, Inc. and certain of its officers are defendants in two purported shareholder class actions filed in the in the U.S. District Court for the District of Utah. The suits are: -- "Roffe v. NPS Pharmaceuticals, Inc., et al.," filed on July 12, 2006; and -- "Baird v. NPS Pharmaceuticals, Inc., et al." Both lawsuits contain substantially identical allegations and allege that between August 2005 and May 2006, the defendants made false and misleading statements concerning the company's market prospects for its proprietary drug, PREOS(R), in violation of federal securities laws. PREOS is for the treatment of osteoporosis. The lawsuits seek certification as a class action, compensatory damages in an unspecified amount, and unspecified equitable or injunctive relief. The first identified suit is "Roffe v. NPS Pharmaceutical, et al., Case No. 2:06-cv-00570-PGC," filed in the U.S. District Court for the District of Utah under Judge Paul G. Cassell. Representing the plaintiffs are: (1) Jeffrey S. Abraham and Jack G. Fruchter of Abraham Fruchter & Twersky, LLP, One Penn Plaza, Ste. 2805, New York City, NY 10119, US, Phone: (212) 279-5050; and (2) Scott A. Call of Anderson & Karrenberg, 50 W. Broadway, Ste. 700, Salt Lake City, UT 84101, Phone: (801) 534- 1700, E-mail: scall@aklawfirm.com. PFIZER INC: Settlement of Bjork-Shiley Heart Valves Suit Ongoing ---------------------------------------------------------------- Wayne Smith, Bowling Claims Administrator urges all patients implanted with Bjork-Shiley Convexo-Concave Heart Valves to register with the court-appointed Bowling Settlement Claims Administrator. Under a 1992 class action settlement agreement in the "Bowling, et al. v. Pfizer Inc., et al." heart valve litigation, financial benefits are still available to certain patients implanted with the Bjork-Shiley Convexo-Concave heart valve. Approximately 86,000 of these heart valves were implanted in patients worldwide. A Supervisory Panel of experts funded by the Bowling Settlement has determined that risk of fracture depends on the patient's age, gender, valve size, valve implant position, and certain valve manufacturing characteristics. Because of a risk of strut fracture that could result in death or serious injury, the U.S. Food and Drugs Administration forced all Bjork-Shiley Convexo-Concave hear valves off the market in 1986. In 1992, Pfizer Inc. and Shiley Inc., a wholly owned subsidiary of Pfizer Inc., negotiated a settlement with members of the Bowling class in the case "Bowling, et al. v. Pfizer Inc., et al." filed in the U.S. District Court for the Southern District of Ohio. The Bowling class members were recipients of a mechanical heart valve manufactured by Shiley known as the Bjork-Shiley Convexo- Concave who claimed that the heart valve was defective due to a small, but potentially catastrophic risk of strut fracture. Under the settlement, the class is defined as "all living persons currently implanted with C/C heart valves and their current spouses" as of Jan. 23, 1992, except those persons who opted out from the class. Guidelines have been developed to determine which patients with Bjork-Shiley Convexo-Concave heart valves will be compensated from the Settlement for their valve replacement surgery. The guidelines are based on a comparison of the risk of the operation to replace the valve with the risk of fracture if the valve is left in place. If the risk of valve fracture exceeds the risk of reoperation, the class member qualifies for monetary benefits. People with Bjork-Shiley Convexo-Concave heart valves are advised to contact a cardiologist to discuss whether they are at an increased risk of fracture or possibly a candidate for a valve replacement. For more information on the class action settlement benefits, contact Wayne Smith, Bowling Claims Administrator, 525 Vine Street, Suite 2300, Cincinnati, Ohio 45202 U.S.A., Phone: 513- 421-4415 or 800-977-0779 (Toll Free), Fax: 513-421-7696, E-mail: bowlingpfizer@fuse.net, Website: http://www.bowling-pfizer.com. The suit is "Bowling, et al, et al v. Pfizer Inc, et al., Case No. 1:91-cv-00256-HJW-SM," filed in the U.S. District Court for the Southern District of Ohio under Judge Herman J. Weber. Representing the defendants are James Ralph Adams of Frost Brown Todd LLC - 1, 2200 PNC Center, 201 E 5th Street, Cincinnati, OH 45202-4182, Phone: 513-651-6800, E-mail: jadams@fbtlaw.com; and Alan F. Goott of Kay Scholer LLP, 425 Park Avenue, New York, NY 10022, Phone: 212-836-8157, Fax: 212-836-8689, E-mail: AGoott@kayescholer.com. Representing the plaintiffs are: (1) James T. Capretz, 5000 Birch Street, Suite 2500, Newport Beach, CA 92660, Phone: 949-724-3000, E-mail: jcapretz@capretz.com; (2) Stanley Morris Chesley of Waite Schneider Bayless & Chesley Co LPA, 1513 Fourth & Vine Tower, One West Fourth Street, Cincinnati, OH 45202, Phone: 513-621- 0267, E-mail: stanchesley@wsbclaw.cc; (3) Bruce A Finzen, 800 LaSalle Ave., Suite 2800, Minneapolis, MN 55402-2015, Phone: 612-349-8500; and (4) Marc David Mezibov of Mezibov & Jenkins, LLP, 401 East Court Street, Suite 600, Cincinnati, OH 45202, Phone: 513-723-1600, Fax: 513-723-1620, E-mail: mmezibov@mezibovjenkins.com. PREMIUM STANDARD: Continues to Face Mo. Property Injury Lawsuit --------------------------------------------------------------- Premium Standard Farms, Inc. remains a defendant in a purported class action, "Herrold et al. v. Contigroup Cos., Inc. et al.," which is pending in the Circuit Court of Jackson County, Kansas City, Missouri, according to the company's Aug. 2, 2006 Form 10- Q filing with the U.S. Securities and Exchange Commission for the period ended June 24, 2006. The suit was briefly removed to the U.S. District Court for the Western District of Missouri, but has since been remanded back to state court. It seeks to create a class of plaintiffs living within 10 miles of the company's farms in northern Missouri, including contract grower farms, who are alleged to have suffered interference with their right to use and have quiet enjoyment of their respective properties and are seeking unspecified damages. The suit is "Daniel Herrold, et al. and others similarly situated v. ContiGroup Companies, Inc., Premium Standard Farms, Inc., and PSF Group Holdings, Inc., Case No. 4:04-cv-00618-GAF," filed in the U.S. District Court for the Western District of Missouri under Judge Gary A. Fenner. Representing the plaintiffs are Tammy R. Dodson, Donnamarie Landsberg and Charles F. Speer of Speer Law Firm, 104 West 9th Street, Suite 305, Kansas City, MO 64105, Phone: (816) 472-3560, Fax: (816) 421-2150, E-mail: tdodson@speerlawfirm.com, dlandsberg@speerlawfirm.com or cspeer@speerlawfirm.com. Representing the company are: (1) Mark D. Anstoetter of Shook Hardy & Bacon LLP-Grand, 2555 Grand Boulevard, Kansas City, MO 64108-2613, Phone: (816) 474-6550, Fax: 816-421-5547, E-mail: manstoetter@shb.com; and (2) Kirk J. Goza, Goza & Honnold, LLC, 1100 Main Street, Suite 2630, Kansas City, MO 64148-2355, Phone: (816) 512-2171, Fax: (816) 512-2172, E-mail: kgoza@gohonlaw.com. PRUDENTIAL FINANCIAL: Faces New Lawsuit Over Stock Broker Pay ------------------------------------------------------------- Prudential Financial, Inc. faces an additional suit alleging that it has improperly classified stock brokers as exempt employees under state and federal wage and hour laws and, therefore, has improperly denied them overtime pay. The complaints seek back overtime pay and statutory damages, interest, and attorneys. The suits also name as defendants Prudential Securities, Inc. and Prudential Equity Group LLC. Between September and October 2005, two complaints -- "Janowsky v. Wachovia Securities, LLC, and Prudential Securities Inc.," and "Goldstein v. Prudential Financial, Inc." -- were filed in the U.S. District Court for the Southern District of New York. The "Goldstein" complaint purports to have been filed on behalf of a nationwide class. The "Janowsky" complaint alleges a class of New York brokers. Also in late 2005, three complaints were filed in California Superior Court, all purporting to have been brought on behalf of classes of California brokers. The suits are: -- "Dewane v. Prudential Equity Group, Prudential Securities Incorporated, and Wachovia Securities LLC"; -- "DiLustro v. Prudential Securities Incorporated, Prudential Equity Group, Inc. and Wachovia Securities"; and -- "Carayanis v. Prudential Equity Group LLC and Prudential Securities, Inc." In June 2006, another purported New York state class action complaint was filed in the U.S. District Court for the Eastern District of New York. The suit, "Panesenko v. Wachovia Securities, et al.," is alleging that the company failed to pay overtime to brokers in violation of state and federal law, according to the company's Aug. 3, 2006 Form 10-Q filing with the U.S. Securities and Exchange Commission for the period ended June 30, 2006. Based in Newark, New Jersey, Prudential Financial, Inc. -- http://www.prudential.com/-- (NYSE: PRU) is a financial services company that offers through its subsidiaries and affiliates an array of financial products and services, including life insurance, mutual funds, annuities, pension and retirement-related services and administration, asset management, banking and trust services, real estate brokerage and relocation services, and, through a joint venture, retail securities brokerage services. PRUDENTIAL FINANCIAL: "Saunders" Plaintiffs May Re-file Claims -------------------------------------------------------------- The U.S. District Court for the District of Maryland has granted plaintiffs in the mutual fund action, "Saunders v. Putnam American Government Income Fund, et al.," leave to re-file their federal securities law claims against Prudential Securities, Inc. In October 2004, Prudential Financial, Inc. and PSI were named as defendants in several class actions brought on behalf of purchasers and holders of shares in a number of mutual fund complexes. The actions were consolidated as part of the multi-district proceeding, "In re: Mutual Funds Investment Litigation, MDL- 1586, Master Docket Nos. 04-md-15861, 04-md-15862, 04-md-15863, and 04-md-15864," which is pending in the U.S. District Court for the District of Maryland. The complaints allege that purchasers and holders of mutual funds were harmed by dilution of the funds' values and excessive fees caused by market timing and late trading. It is seeking unspecified damages. In August 2005, the company was dismissed from several of the actions, without prejudice to repleading the state claims, but remains a defendant in other actions in the consolidated proceeding. In July 2006, in one of the consolidated mutual fund actions, "Saunders v. Putnam American Government Income Fund, et al.," the court granted plaintiffs leave to re-file their federal securities law claims against PSI. Motions to dismiss the other actions are pending. For more details, visit: http://researcharchives.com/t/s?f40 http://researcharchives.com/t/s?f42 PRUDENTIAL INSURANCE: Court Denies Appeal on Insurance Complaint ---------------------------------------------------------------- The Superior Court of New Jersey, Essex County nixed plaintiffs' application for interlocutory appeal in relation to certain dismissed claims in the class action, "Capitol Life Insurance Co. v. Prudential Insurance, et al.," which was filed against: -- Prudential Insurance Co. of America; -- Prudential Home Mortgage Co., Inc.; and -- several other subsidiaries. The suit was filed in connection with the sale of certain subordinated mortgage securities sold by a subsidiary of Prudential Home Mortgage. In May 2000, plaintiffs filed a second amended complaint that alleges violations of the New Jersey securities statute and the Racketeer Influenced and Corrupt Organizations Act, fraud, conspiracy and negligent misrepresentation, and seeks compensatory as well as treble and punitive damages. In October 2002, plaintiffs' motion for class certification was denied. Since that time, the court has permitted nine additional investors to intervene as plaintiffs. In August 2005, the court dismissed the New Jersey Securities Act and RICO claims and the negligent misrepresentation claim. Plaintiffs' application for interlocutory appeal of this ruling was denied, according to the company's Aug. 3, 2006 Form 10-Q filing with the U.S. Securities and Exchange Commission for the period ended June 30, 2006. PRUDENTIAL INSURANCE: Court Nixes Appeal on HMO Suit Settlement --------------------------------------------------------------- An appeal on the settlement of the class action, "In Re Humana, Inc. Managed Care Litigation," which was filed against Prudential Insurance Co. of America and other health management organizations in U.S. District Court for the Southern District of Florida, was recently dismissed. Filed in 2000, the nationwide class action originally known as "Shane v. Humana, et al." was brought on behalf of provider physicians and physician groups. It alleges that the company and other health care companies engaged in an industry-wide conspiracy to defraud physicians by failing to pay under provider agreements and by unlawfully coercing providers to enter into agreements with unfair and unreasonable terms. Specifically, the suit names as defendants Humana, Inc., Aetna, Inc., Aetna-USHC, Inc., Cigna, Health Net, Inc., Human Health Plan, Inc., Pacificare Health Systems, Inc., the company, United Health Group, United Health Care and Wellpoint Health Networks, Inc. An amended complaint, naming additional plaintiffs, including three state medical associations, and an additional defendant, was filed in March 2001. It alleges claims of breach of contract, quantum meruit, unjust enrichment, violations of the Racketeer Influenced and Corrupt Organizations Act, conspiracy to violate RICO, aiding and abetting RICO violations, and violations of state prompt pay statutes and the California unfair business practices statute. The amended complaint seeks compensatory and punitive damages in unspecified amounts, treble damages pursuant to RICO, and attorneys' fees. In September 2002, the District Court granted plaintiffs' motion for class certification of a nationwide class of provider physicians. In September 2004, the U.S. Court of Appeals for the Eleventh Circuit affirmed the decision with respect only to the federal claims for conspiracy to violate RICO and aiding and abetting RICO violations. In September 2005, the district court entered a final order approving the settlement of these claims by Prudential Insurance, which provides for payment to plaintiffs in the amount of $22 million. Two members of the plaintiff class appealed the final order. In February 2006, the appeals were dismissed. One appeal was reinstated in April 2006 and dismissed in June 2006. The suit is "In Re Humana Inc. Managed Care Litigation, MDL 1334," filed in the U.S. District Court for the Southern District of Florida under Judge Federico Moreno. For more details, contact: (1) Archie Lamb, 2017 2nd Avenue North, Birmingham, AL 35203, Phone: (205) 324-4644 and (800) 324-4425, Fax: (205) 324-4649, E-mail: Alamb@ArchieLamb.com; Web site: http://www.archielamb.com/;and (2) Harley S. Tropin of Kozyak Tropin & Throckmorton, P.A., 2525 Ponce de Leon, 9th Floor, Coral Gables, Florida 33134, (Miami-Dade Co.), Phone: 305-372-1800, Fax: 305- 372-3508, E-mail: http://www.kttlaw.com. PRUDENTIAL SECURITIES: Continues to Face IPO Litigation in N.Y. --------------------------------------------------------------- Prudential Securities, Inc. remains a defendant in a number of industry-wide purported class actions filed in the U.S. District Court for the Southern District of New York relating to its former securities underwriting business, according to the company's Aug. 3, 2006 Form 10-Q filing with the U.S. Securities and Exchange Commission for the period ended June 30, 2006. Plaintiffs in one consolidated proceeding "In re: Initial Public Offering Securities Litigation, Case No. 21 MC 92 (SAS)," allege that the underwriters engaged in a scheme involving tying agreements, undisclosed compensation arrangements and research analyst conflicts to manipulate and inflate the prices of shares sold in initial public offerings in violation of the federal securities laws. Certain issuers of these securities and their and former officers and directors have also been named as defendants. In October 2004, the district court granted plaintiffs' motion for class certification in six "focus cases." The underwriter defendants appealed that ruling to the U.S. Court of Appeals for the Second Circuit, which heard argument in March 2006. In June 2004, plaintiffs entered into a settlement agreement with the issuers, officers and directors named as defendants in the lawsuits, which the district court preliminarily approved in February 2005. For more details, visit http://www.iposecuritieslitigation.com/. QWEST COMMUNICATIONS: DERP Opts Out of $400M Suit Settlement ------------------------------------------------------------ The Denver Employees Retirement Plan has opted out of the $400 million settlement of the consolidated securities class action against Qwest Communications International, Inc., The Denver Post reports. According to Vicki Halliday, the plan's general counsel, the Denver workers who were slated to receive a total of less than $8,000 from the proposed settlement, instead, filed its own suit in the U.S. District Court for the District of Colorado against Qwest seeking at least $1.2 million. The retirement plan is seeking its losses plus attorney fees and other costs -- far more than what it was slated to receive from the class-action settlement, which was announced last November. Also named as defendants in the Retirement Plan suit are several former Qwest executives and directors and former Qwest auditor Arthur Andersen. Originally, 12 putative class actions were brought on behalf of purchasers of the company's publicly traded securities between May 24, 1999 and Feb. 14, 2002. The suits were consolidated as one class action in the U.S. District Court for the District of Colorado. On Nov. 23, 2005, the company and certain other defendants, and the putative class representatives entered into and filed with the court a Stipulation of Partial Settlement to settle the consolidated securities action against the company and certain other defendants. On Jan. 5, 2006, the court issued an order preliminarily approving the proposed settlement and certifying a settlement class on behalf of purchasers of the company's publicly traded securities between May 24, 1999 and July 28, 2002. The U.S. District Court for the District of Colorado has yet to give final approval to the proposed settlement (Class Action Reporter, Aug. 7, 2006). The recent suit is "Denver Employees Retirement Plan v. Qwest Communications International, Inc. et al., Case No. 1:06-cv- 01539-REB-BNB," filed in the U.S. District Court for the District of Colorado under Judge Robert E. Blackburn, with referral to Judge Boyd N. Boland. Representing plaintiffs is Ronald L. Wilcox of Hill & Robbins, P.C., 1441 - 18th Street, #100 Denver, CO 80202, Phone: 303-296- 8100, E-mail: ronwilcox@hillandrobbins.com. SOUTHERN CO: Plaintiffs Appeal Claims Dismissal in Mirant Suit -------------------------------------------------------------- Plaintiffs in the securities class action filed against The Southern Co. in relation to Mirant Corp.'s initial public offering are seeking reconsideration of the court order dismissing certain of their claims in the case. The suit is pending in the U.S. District Court for the Northern District of Georgia against the company, certain of its former and current senior officers, and 12 underwriters of the IPO. Several Mirant shareholders originally filed the suit against Mirant Corp. -- a former wholly owned subsidiary of the company until its initial public offering in October 2000 -- and certain Mirant officers in May 2002. Several other similar lawsuits were subsequently filed and later consolidated into this litigation. In November 2002, Southern Co., certain former and current senior officers of the company, and 12 underwriters of Mirant's initial public offering were added as defendants. The amended complaint is based on allegations related to alleged improper energy trading and marketing activities involving the California energy market, alleged false statements and omissions in Mirant's prospectus for its initial public offering and in subsequent public statements by Mirant, and accounting-related issues previously disclosed by Mirant. The lawsuit purports to include persons who acquired Mirant securities between Sept. 26, 2000 and Sept. 5, 2002. In July 2003, the court dismissed all claims based on Mirant's alleged improper energy trading and marketing activities involving the California energy market. The remaining claims do not allege any improper trading and marketing activity, accounting errors, or material misstatements or omissions on the part of the company but seek to impose liability on the company based on allegations that the company was a "control person" as to Mirant prior to the spin off date. The company filed an answer to the consolidated amended class action complaint in September 2003. Plaintiffs also filed a motion for class certification. On March 24, 2006, the plaintiffs filed a Motion for Reconsideration requesting that the court vacate that portion of its July 14, 2003 order dismissing the plaintiffs' claims based upon Mirant's alleged improper energy trading and marketing activities involving the California energy market. The company and the other defendants have opposed the plaintiffs' motion. The plaintiffs have also stated that they intend to request that the court grant leave for them to amend the complaint to add allegations based upon claims asserted against the company in the Mirant bankruptcy litigation. As a result of Mirant's Chapter 11 proceeding, the Bankruptcy Code automatically stayed all litigation as to Mirant. In November 2003, the Bankruptcy Court granted a request to extend this automatic stay to all other non-debtor defendants, including the company and its current and/or former officers named as defendants in the Mirant securities litigation. However, the Bankruptcy Court authorized Mirant to agree with parties in pending actions to allow discovery or other matters to proceed without violating the stay. Mirant and plaintiffs' counsel in the Mirant securities litigation agreed that document discovery could proceed. During Mirant's Chapter 11 proceeding, the securities litigation was stayed, with the exception of limited discovery. Since Mirant's plan of reorganization has become effective, the stay has been lifted, and activity in this case is expected to resume. Under certain circumstances, Southern Co. will be obligated under its bylaws to indemnify the four current and/or former Southern Co. officers who served as directors of Mirant at the time of its initial public offering through the date of the spin off and who are also named as defendants in this lawsuit. The final outcome of these matters cannot now be determined, the company said in a disclosure to the Securities and Exchange Commission. The suit is "In Re Mirant Corp. Securities Litigation, Case No. 1:02-cv-01467-RWS," filed in the U.S. District Court for the Northern District of Georgia under Judge Richard W. Story. Representing the plaintiffs are: (1) Robert Abrams, Gustavo Bruckner, Fred Taylor Isquith, Wolf Haldenstein Adler Freeman & Herz, 270 Madison Avenue, New York, NY 10016, Phone: 212-545-4600, E- mail: isquith@whafh.com; and (2) David Andrew Bain, Martin D. Chitwood, Chitwood & Harley, 1230 Peachtree Street, N.E. 2300 Promenade II Atlanta, GA 30309, Phone: 404-873-3900, E-mail: dab@classlaw.com or mdc@classlaw.com Representing the defendants are, Kirk Quillian, Thomas Edward Reilly, Jaime L. Theriort, Christi A. Cannon, Troutman Sanders Bank of America Plaza, 600 Peachtree Street, N.E., Suite 5200 Atlanta, GA 30308-2216, Phone: 404-885-3000, E-mail: kirk.quillian@troutmansanders.com, thomas.reilly@troutmansanders.com, jaime.theriot@troutmansanders.com. ST. PAUL: Minn. Court Considers Motion to Dismiss Stock Suit ------------------------------------------------------------ The U.S. District Court for the District of Minnesota heard oral arguments on the motion to dismiss a consolidated securities class action filed against St. Paul Travelers Cos., Inc. Initially, three actions were filed against the company and certain of its current and former officers and directors in the U.S. District Court for the District of Minnesota. Two of these actions were: -- "Kahn v. The St. Paul Travelers Companies, Inc., et al. (Nov. 2, 2004);" and -- "Michael A. Bernstein Profit Sharing Plan v. The St. Paul Travelers Companies, Inc., et al. (Nov. 10, 2004)." Certain shareholders of the company brought the putative class actions against the company and certain of its current and former officers and directors. These actions have been consolidated as, "In re St. Paul Travelers Securities Litigation II," and a lead plaintiff and lead counsel have been appointed. On Jul. 11, 2005, the lead plaintiff filed an amended consolidated complaint. The amended consolidated complaint alleges violations of federal securities laws in connection with the company's alleged failure to make disclosure relating to the practice of paying brokers commissions on a contingent basis, the company's alleged involvement in a conspiracy to rig bids and the company's allegedly improper use of finite reinsurance products. On Sept. 26, 2005, the company and the other defendants in "In re St. Paul Travelers Securities Litigation II" moved to dismiss the amended consolidated complaint for failure to state a claim. Oral argument on the company's motion to dismiss was presented on June 15, 2006. On Apr. 1, 2004, Travelers Property Casualty Corp. merged with a subsidiary of The St. Paul Companies, Inc. The suit is "In Re: St. Paul Travelers Securities Litigation II, Case No. 0:04-cv-04697-JRT-FLN," filed in the U.S. District Court for the District of Minnesota under Judge John R. Tunheim with referral to Magistrate Judge Franklin L. Noel. Representing the plaintiffs are: (1) Fred Taylor Isquith, Gustavo Bruckner and Mark C Rifkin of Wolf Haldenstein Adler Freeman & Herz, NYC, 270 Madison Ave., New York, NY 10016, Phone: 212-545-4690, 212-545-4605 and 212-545-4762, Fax: 212-545-4653, E- mail: isquith@whafh.com, bruckner@whafh.com and rifkin@whafh.com; and (2) Jack L. Chestnut and Karl L. Cambronne of Chestnut & Cambronne, 222 S. 9th St., Ste. 3700, Mpls., MN 55402, Phone: (612) 339-7300, Fax: 612-336-2940, E-mail: jchestnut@chestnutcambronne.com and kcambronne@chestnutcambronne.com. Representing the defendants are: (i) David H. LaRocca, Michael J. Chepiga and Michael J. Garvey of Simpson Thacher & Bartlett, LLP, 425 Lexington Ave., New York, NY 10017-3954, Phone: 212- 455-2377, 212-455-2598 and 212-455-7358, E-mail: dlarocca@stblaw.com, mchepiga@stblaw.com and mgarvey@stblaw.com; and (ii) Peter W. Carter and Richard B. Solum of Dorsey & Whitney - Mpls., 50 S. 6th St., Ste. 1500, Mpls., MN 55402-1498, Phone: 612-340-2600, Fax: 612-340-2868, E- mail: carter.peter@dorsey.com and solum.rick@dorsey.com. TASER INTERNATIONAL: Settles Ariz. Stock Fraud Lawsuit for $20M --------------------------------------------------------------- Taser International, Inc. has reached agreements to settle: -- a shareholder class action pending in U.S. District Court for the District of Arizona; -- derivative lawsuits pending in the U.S. District Court for the District of Arizona, the Arizona Superior Court, and the Delaware Chancery Court; and -- the Section 220 lawsuit for production of documents pending in Delaware Chancery Court. Under these agreements, all claims against the company and individuals named as defendants will be dismissed without presumption or admission of any liability or wrongdoing. Pursuant to the terms of the agreement to dismiss the shareholder class action litigation, TASER International will pay to the plaintiffs, for the benefit of the class, the total of $20 million payable by approximately $4.1 million from insurance proceeds, $7.9 million in company cash, and $8 million in company stock or cash at the company's election. Pursuant to the terms of the agreement to dismiss the derivative lawsuit pending in the U.S. District Court for the District of Arizona, TASER International will pay the amount of $1.75 million in company stock for plaintiffs' attorney fees and adopt certain corporate governance provisions consisting of the designation of a lead independent director who will be chosen from one of three independent directors now serving on the board. As part of the settlement of the derivative action pending in the District Court of Arizona, the two other derivative actions and the Section 220 action will be dismissed as well. In conjunction with the agreements to settle, the company will take a charge of approximately $18 million for litigation and related charges to the June 30, 2006 results. As such, the agreements to settle will be reflected in the company's Form 10- Q. "After a review of the evidence, it does not appear that the company oversold the safety of the TASER(R) device nor that there was any evidence of wrongdoing. This is consistent with the termination of the Securities and Exchange Commission investigation into this same general subject matter with a recommendation of no enforcement action," commented Robert B. Weiser, plaintiff's lead counsel in the derivative litigation. "As a result, we accepted company stock as payment for our legal fees because we believe in the future of the company," concluded Mr. Weiser. Rick Smith, chief executive of TASER International, commented: "Our commitment to our shareholders and our customers was the driving force behind this settlement, and we look forward to putting these issues behind the company and moving ahead with the next phase of TASER's business strategy. We have generated significant momentum in our operating results as of late. As a result, we believe it is imperative that we maintain our focus on the execution of these strategic initiatives. It is important for our company that we resolve the outstanding shareholder and derivative litigation, in part to protect our company and our customers from potentially disruptive, time- consuming and expensive class action legal inquiries." "From a risk management standpoint, we felt that the settlement was in the best interests of the company and our shareholders," commented Dan Behrendt, chief financial officer of TASER International. "The cash part of the settlement is roughly twice the amount of cash generated from operations in the 2nd Quarter of 2006 and with $49.1 million of cash and investments at June 30, 2006; this is an amount the company could adequately manage. The stock component of the settlement represents an approximate 2 percent dilution at the current stock price and given the inherent costs, distraction and uncertainty that come with this type of litigation, the company felt that settling these lawsuits now under the current terms was the best choice." These agreements to settle these actions are conditioned upon the appropriate settlement documents, approval by the respective Courts and other factors. There is no assurance that the settlements will be completed. If the settlements are not completed, then the parties may attempt to reach agreement on another settlement or resume the litigation. Further, the Board of Directors of TASER International, Inc. approved, in connection with the approval of the settlement agreements, a resolution authorizing the company to purchase up to $10 million of the company's common stock between the current date and the date of final payment of the shareholder class action settlement subject to stock market conditions and corporate considerations. The final payment of the settlement will take place after final court approval of the formal shareholder class action settlement agreement, a process expected to take several months. Case Background Beginning on or about Jan. 10, 2005, numerous securities class actions were filed against the company and certain of its officers and directors. These actions were filed on behalf of the purchasers of the company's stock in various class periods, beginning as early as May 29, 2003 and ending as late as Jan. 14, 2005 (Class Action Reporter, March 22, 2006). The majority of these lawsuits were filed in the U.S. District Court for the District of Arizona. Four actions were filed in New York and one Michigan, which were transferred to the District of Arizona. Judge Susan Bolton consolidated the class actions and lead plaintiff and lead counsel were selected. The lead plaintiff filed a consolidated complaint, which became the operative complaint for all of the class actions, on Aug. 29, 2005. The operative class period is May 29, 2003 to Jan. 11, 2005. The defendants filed a motion to dismiss the consolidated complaint, which has been fully briefed for the court but has not yet been decided. It alleged, among other things, violations of the U.S. Securities Exchange Act of 1934, as amended, and Rule 10b-5, promulgated thereunder, and seeks unspecified monetary damages and other relief against all defendants. The consolidated amended complaint generally alleges that the company and the individual defendants made false or misleading public statements regarding, among other things, the safety of the company's products and the company's ability to meet its sales goals, including the validity of a $1.5 million sales order with the company's distributor, Davidson's, in the fourth quarter of 2004. The consolidated complaint also alleges that product defects were leading to excessive product returns by customers. The suit is "In re Taser International Securities Litigation, Master File No. CV 05-115-PHX-SRB," filed in the U.S. District Court for the District of Arizona under Judge Susan R. Bolton. Representing the defendants are: (1) David B. Rosenbaum and Maureen Beyers both of Osborn Maledon, P.A., 2929 North Central Avenue, Phoenix, Arizona 85012-2794, Phone: (602) 640-9000, Fax: (602) 664-2053, E-mail: drosenbaum@omlaw.com or mbeyers@omlaw.com; and (2) Keith E. Eggleton and David A. McCarthy both of Wilson Sonsini Goodrich & Rosati, 650 Page Mill Road, Palo Alto, CA 94304, Phone: (650) 849-3011, Fax: (650) 493- 6811, E-mail: KEggleton@wsgr.com or DMcCarthy@wsgr.com. Representing the plaintiffs are: (1) Robert Mitchell, 2210 East Camelback Road, Suite 122B, Phoenix, AZ 85106; (2) Mel E. Lifshitz, Keith M. Fleischman, Timothy J. MacFall, Joseph R. Seidman, Jr., Stephanie Beige, Russell M. Iger and Jeffrey Lerner all of Berstein Liebhard & Lifshitz, LLP, 10 East 40th Street, New York, NY 10016; (3) Mario Alba, Jr. of Lerach Coughlin Stoia Geller Rudman & Robbins LLP, 200 Broadhollow Rd., Ste 406, Melville, NY 11747, Phone: (631) 367-7100; (4) Patricia I. Avery of Wolf Popper Ross Wolf & Jones LLP, 845 3rd Ave., 12th Floor, New York, NY 10022, Phone: (212) 759-4600; and (5) Jeffrey Craig Block of Berman DeValerio & Pease, 1 Liberty Sq., Ste 8, Boston, MA 02109, Phone: (617) 542- 8300. TRIZEC PROPERTIES: Faces Lawsuits in Ill. Over Brookfield Deal -------------------------------------------------------------- Trizec Properties, Inc. faces two purported stockholder class actions in the Circuit Court of Cook County, Illinois over a merger agreement with affiliates of Brookfield Properties Corp. On June 5, 2006, the company, Trizec Holdings Operating, LLC, and Trizec Canada, Inc., entered into an agreement and plan of merger and arrangement agreement with Grace Holdings LLC, Grace Acquisition Corp., 4162862 Canada Limited, and Grace OP LLC, who are all affiliates of Brookfield Properties. Trizec Canada is an indirect holder of approximately 38.1% of the company's outstanding common stock and all of the company's outstanding special voting stock and Class F convertible stock (TZ Canada). On June 6, 2006, two substantially identical purported stockholder class actions were filed related to the merger agreement. The suits are: -- "Doris Staehr v. Trizec Properties, et al. (Case No. 06CH11226);" and -- "Hubert Van Gent v. Trizec Properties, et al. (Case No. 06CH11571)." The suits named the company and each of its directors as defendants. They allege that the company's directors were conflicted, unjustly enriched, and engaged in self-dealing, and violated their fiduciary duties to the company's stockholders in approving the mergers, the merger agreement and the other transactions contemplated by the merger agreement. The lawsuits seek to enjoin the completion of the mergers and the related transactions. Additionally, the lawsuits seek class-action status, rescission of, to the extent already implemented, the mergers, the Trizec Voting Agreement, the PMCI Voting Agreement, and the termination fees, and costs and disbursements incurred in connection with the lawsuits, including attorneys' and experts' fees. The company said that the suits, even if they be found to be without merit, may potentially delay or, if the delay is substantial enough to prevent the consummation of the mergers by December 31, 2006, potentially prevent the closing of the mergers. Based Chicago, Illinois, Trizec Properties, Inc. (NYSE: TRZ) -- http://www.trz.com/-- is a fully integrated and self-managed, publicly traded real estate investment trust, in the U.S. It is engaged in owning and managing office properties in the U.S. As of December 31, 2005, it owned interests in 50 office properties comprising approximately 36.8 million square feet of total area. UNITED STATES: Pa. Residents Fail to Stop Foreclosure of Homes -------------------------------------------------------------- U.S. District Chief Judge Donetta W. Ambrose has refused to stop the sale of an East Hills subsidized housing development to the Urban Redevelopment Authority, according to the Pittsburgh Post- Gazette. At a recent hearing, the judge told residents of Third East Hills Park in Pittsburgh, Pennsylvania, who are seeking a preliminary injunction in a class action to block the sale, that being forced to move out of the property does not cause irreparable harm. Residents of the 30-year-old Third East Hills Park subsidized co-op filed a class action against the U.S. Department of Housing and Urban Development on July 26, 2006 in the U.S. District Court for the Western District of Pennsylvania. Named as plaintiffs in the case are: -- Third East Hills Park, Inc., -- Aline Reid, -- Dale Peoples, -- Jean Massie, -- Shirley Sowell, -- Yevorn Gaskins, -- Yugonda Alice, -- Zetta Brandon, and -- Louise Brandon The 49-page complaint pointed out that HUD wants to sell the property to the Urban Redevelopment Authority for $1, which in turn wants to sell it for a nominal fee to companies that plan to turn it into mixed-income housing. The suit, which was filed under the 1968 Fair Housing Act, states that HUD basically wants to sell the property to developers under the "East Hills Visioning" plan. Under that plan the homes of Third East Hills would be demolished and redeveloped. Those involved in the project have obtained and committed $60 million in public and private funding. The plan is reportedly similar to what happened to the First and Second East Hills Parks in 2002 and 2003, which were sold with the intent to revitalize the whole community with mixed-income housing and apartments. The lawsuit pointed out that under the co-op plan at Third East Hills, residents were able to become shareholders by paying a fee up front, and then contributing 30 percent of adjusted household income each month toward rent and utilities. It thus contends that under the current deed for the property, it must be used as "affordable housing" and for that to change, the deed must be nullified. In order to achieve that nullification, HUD is foreclosing, based on a failure in four consecutive physical inspections. However, plaintiffs claim that they never missed a mortgage payment and should not be foreclosed upon. Plaintiffs are seeking class certification for the case to include all others "similarly situated." They are also seeking to have the HUD permanently enjoined from foreclosing on the property; stopped from displacing any other residents; and forced to help manage the property. The suit is "Massie, et al. v. U.S. Department of Housing and Urban Development, et al., Case No. 2:06-cv-01004-DWA," filed in the U.S. District Court for the Western District of Pennsylvania under Judge Donetta W. Ambrose Representing the plaintiffs is Kevin Quisenberry of Community Justice Project, 429 Forbes Avenue, 1705 Allegheny Building, Pittsburgh, PA 15219, Phone: (412) 434-6004, E-mail: kquisenberry@earthlink.net. UNITED STATES: Investors Lose Out in Stock Suits, Research Says --------------------------------------------------------------- Since 1995, there have been 755 separate cases of class action securities litigation on allegations of companies inflating their stock prices due to fraud or untimely disclosure. Settlements from these cases totaled about $25.4 billion. On the surface, it appears that wronged shareholders have received just retribution for the losses incurred from purchasing stocks at inflated prices. But research from a professor at the Olin School of Business at Washington University in St. Louis shows that individual shareholders aren't receiving much benefit at all -- in fact, if anything they're losing out. "The majority of participants in securities class actions are institutional investors who trade more than $100 million a year. They don't have to pay for any gains they made from selling the inflated stocks, and once they're compensated for their losses they actually come out ahead," said Anjan Thakor, PhD., finance professor at the Olin School of Business. "Institutional investors are trading such a large volume. The net trading loss they suffer from buying inflated stocks is only 20 percent of their gross losses. Of the more than 2,300 firms we studied, 40 percent were shown to have realized a net benefit from the settlement proceeds." The only way institutional investors might lose from buying inflated shares of stock is if they buy newly issued securities. Mr. Thakor said that the Private Securities Litigation Reform Act of 1995 causes an asymmetry in how much benefit investors receive when companies actu fraudulently. "What's worse is that the system is set up so that one group of shareholders ends up suing another group of shareholders. If I'm a shareholder who bought stock before the period where stocks were inflated, I can't take part in the litigation, yet I will essentially be paying the settlement to those investors who did buy inflated shares," Mr. Thakor said. "It's a process of taking money from one group of shareholders in the company and giving it to another for some wrongdoing by the company. Well, send the managers to jail. Fine them. Do whatever you want to do with them. But why should I be paying a fellow shareholder when I'm not responsible for the problem?" Mr. Thakor said that the injustice of the system is made worse because the actual transfer of the payment is not a neutral process either. Huge resources are used up paying the lawyers and accountants who handled the litigation. After you pay all expenses, investors end up with maybe three cents on the dollar. "The settlement doesn't help the shareholders who paid the fine since they're paying out of their own pocket. It doesn't really help the shareholders who sued company, who barely recover their losses. So who made the money? Large institutional investors handling more than $100 million in assets, the lawyers and the accountants," Mr. Thakor said. The inequities that Mr. Thakor discovered are part of an analysis he conducted for the U.S. Chamber Institute for Legal Reform. He said his findings are disheartening since the Private Securities Litigation Reform Act of 1995 was an attempt to promote transparency in corporate activities and prevent fraud. In Mr. Thakor's opinion, it's time to re-examine the act, incorporating ways to appropriately punish those who committed the wrongdoing. The focus ought to be on getting managers to comply since they're the ones making the decisions so the company can have a transparent financial market. "I don't think you should get there by having system by which the only people who benefit are the lawyers, accountants and large institutional investors. The system ought to impose punishment on the people who committed the crime -- that ought to be the managers, not the shareholders." UNIVERSITY OF CALIFORNIA: Paying $12M in Discrimination Suit ------------------------------------------------------------ The U.S. District Court for the District of New Mexico has approved a $12 million settlement of the consolidated class action brought on behalf of females and Hispanics employed by the Regents of the University of California at Los Alamos National Laboratory between Dec. 10, 2000 and June 1, 2006. The lawsuits allege disparities in pay, promotions and other terms and conditions of employment. The Laboratory agreed to settle the lawsuits without admitting wrongdoing. The settlement agreement provides that the Regents will pay $12 million, not including attorneys' fees and costs. The court has given its preliminary approval to the proposed settlement. A hearing on a final approval will be held on Oct. 31, 2006, 9:00 a.m. at the U.S. District Court for the District of New Mexico, 333 Lomas Blvd., New Mexico, Albuquerque, New Mexico. The class in the suit consists of all females and Hispanics employed by the Regents of the University of California at the Los Alamos National Laboratory who are or were regular, limited- term or short-term employees at any time between Dec. 10, 2000, and June 1, 2006. Deadline for submission of claims is November 30, 2006. Deadline to object or opt out from the suit is Aug. 28, 2006. The suit is a consolidation of the suits: -- Veronique A. Longmire and Laura Barber, Case No. CIV-03- 1404 WJ/RLP against the Regents of The University of California, d/b/a Los Alamos National Laboratory; and -- Yolanda Garcia, Loyda Martinez, gloria a. Bennett, Ph.D., and Yvonne Ebelacker; Hispanic Roundtable of New Mexico; and University Professional & Technical, Employees CWA 9119 (AFL-CIO) Local, UPTE-Los Alamos (Case No. No. CIV-04-112 WJ/RLP) against Regents Of The University of California, and G. Peter Nanos, in his individual and official capacities. On December 10, 2003, a complaint alleging violation of the Equal Pay Act and breach of contract was filed in by Veronique A. Longmire and Laura Barber, on their own behalf and as representatives of a class of similarly situated employees at the Laboratory. On Jan. 6, 2004, a second lawsuit was filed in Rio Arriba County District Court by Yolanda Garcia, Loyda Martinez, Gloria A. Bennett, Yvonne Ebelacker, Hispanic Roundtable of New Mexico, and University Professional & Technical Employees CWA 9119 (AFL- CIO) alleging violation of the Equal Pay Act, breach of contract and other claims. The Garcia Action was removed to the U.S. District Court for the District of New Mexico and consolidated with the Barber Action to become the consolidated actions. The plaintiffs in the consolidated actions claim that the Regents, which operates and manages the Laboratory, and G. Peter Nanos, discriminated against female and Hispanic employees in terms of pay, promotion, educational opportunities, and other terms and conditions of employment. The consolidated actions sought unspecified damages for lost earnings and benefits, emotional distress damages, liquidated damages, punitive damages, and attorneys' fees and costs, in addition to certain injunctive and declaratory relief. On June 1, 2006, upon the stipulation of the parties, the court granted certification of a class pursuant to Rule 23, Federal Rules of Civil Procedure. The court has appointed as plaintiffs' class counsel: Patrick D. Allen and Joseph B. Wosick of Yenson, Lynn, Allen & Wosick, P.C., and Michael J. Flannery of Carey & Danis, LLC; and John C. Bienvenu, Richard W. Hughes, and Robert R. Rothstein of Rothstein, Donatelli, Hughes, Dahlstrom, Schoenburg & Bienvenu, LLP. The court has appointed as class representatives Laura Barber, Yolanda Garcia, Loyda Martinez, Gloria A. Bennett, and Yvonne Ebelacker. A copy of the settlement is available free of charge at: http://ResearchArchives.com/t/s?f63 The class counsels are: (1) Patrick D. Allen at Yenson, Lynn, Allen & Wosick, 4908 Alameda Blvd. NE, Albuquerque, NM 87113, Phone: (505) 266-3995; (2) Michael J. Flannery at Carey & Danis, 8235 Forsyth Blvd., Suite 1100, St. Louis, Missouri 63105, Phone: 314-725-7700; and (3) John C. Bienvenu at Rothstein, Donatelli, Hughes, Dahlstrom, Schoenburg & Bienvenu, P.O. Box 8180, Santa Fe, NM 87504-8180, Phone: 505-988-8004. Claims administrator: PO Box 1254, Minneapolis, MN 55440-1254, On the Net: www.lanlclassactionsettlement.com, Phone: 1-800-680- 3841 (toll-free number). WACHOVIA CORP: To Pay $1.25M in Adelphia Securities Lawsuit ----------------------------------------------------------- Wachovia Corp. is paying $1.25 million as part a $460 million settlement in "In Re Adelphia Communications Corp. Securities and Derivative Litigation, Case No. 03 MD 1529 (LMM) or MDL- 1529," according to regulatory filings. Banks involved in the proposed $460 million settlement in "In Re Adelphia Communications Corp. Securities and Derivative Litigation, Case No. 03 MD 1529 (LMM) or MDL-1529," reached a preliminary agreement to pay $250 million to settle investor lawsuits over losses from Adelphia's collapse. The banks included in this settlement are: -- ABN AMRO Inc., -- ABN AMRO Bank N.V., -- Banc of America Securities, LLC, -- Bank of America, N.A. (successor by merger to Fleet National Bank), -- Bank of Montreal, -- Barclays Capital, Inc., -- Barclays Bank, PLC, -- BNY Capital Markets, Inc., -- The Bank of New York Co., Inc., -- The Bank of New York, -- CIBC World Markets Corp., -- CIBC, Inc., -- Citigroup Global Markets Holdings, Inc. (f/k/a SSB Inc.), -- Citibank, N.A., -- Citicorp U.S.A., Inc., -- Calyon Securities (USA) Inc. (f/k/a Credit Lyonnais Securities (USA) Inc.), -- Calyon New York Branch (successor by operation of law to Credit Lyonnais, New York Branch), -- Credit Suisse Securities (USA) LLC (f/k/a Credit Suisse First Boston LLC), -- Credit Suisse, New York Branch (f/k/a Credit Suisse First Boston, New York Branch), -- Deutsche Bank Securities Inc. (f/k/a Deutsche Bank Alex. Brown Inc.), -- Deutsche Bank AG, -- Fleet Securities Inc., -- Harris Nesbitt Corp. (f/k/a BMO Nesbitt Burns Corp.), -- JPMorgan Securities, Inc., -- JPMorgan Chase & Co., -- JPMorgan Chase Bank, N.A., -- PNC Capital Markets, Inc., -- PNC Bank Corp., -- PNC Bank, National Association, -- Scotia Capital (USA), Inc., -- The Bank of Nova Scotia, -- SG Cowen Securities Corp., -- Societe Generale, -- SunTrust Capital Markets, Inc. (f/k/a SunTrust Equitable Securities), -- SunTrust Bank, -- TD Securities (USA) LLC (f/k/a TD Securities (USA) Inc.), -- Toronto Dominion (Texas) LLC (f/k/a Toronto Dominion (Texas) Inc.), -- Wachovia Capital Markets, LLC (f/k/a Wachovia Securities, Inc.), and -- Wachovia Bank, National Association. The court will hold a fairness hearing on Nov. 10, 2006 at 2:15 p.m. for the proposed $460 million settlement in the U.S. District Court for the Southern District of New York, Courtroom 15D, 500 Pearl Street, New York, New York 10007-1312. Deadline for submitting a proof of claim is March 10, 2007. The settlement covers all persons and entities that purchased or otherwise acquired securities issued by Adelphia Communications Corp. or its subsidiaries between Aug. 16, 1999, and June 10, 2002. It consists of two separate settlements: -- the $210,000,000 Deloitte & Touche Settlement; and -- the $250,000,000 Banks Settlement. Beginning in April 2002, more than 30 individual and class actions were filed by purchasers of Adelphia debt and equity securities against Adelphia, its officers and directors, its outside counsel, Adelphia's auditors Deloitte & Touche, and/or various of Adelphia's underwriters and lenders, the banks. Most of those actions were filed in the U.S. District Court for the Eastern District of Pennsylvania and were assigned to Judge Herbert Hutton. Among the cases filed in the Eastern District of Pennsylvania were approximately 30 class actions asserting claims under the U.S. Securities Act of 1933 and/or the U.S. Securities Exchange Act of 1934. In addition to the class actions, public pension funds and/or fund managers seeking to recoup losses on behalf of their funds commenced several individual actions. On April 30, 2002, Judge Hutton entered an order consolidating the then pending actions filed in the Eastern District of Pennsylvania as, "In re Adelphia Communications Securities Litigation, Master File No. 02 CV 1781," and providing for the consolidation of all later-filed actions. On or about June 25, 2002, Adelphia and its subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court in the Southern District of New York. The Chapter 11 cases were assigned to Hon. Robert E. Gerber and are being jointly administered in the case, "In re Adelphia Communications Corp., et al., Case No. 02- 41729 (REG)." Thereafter, by Order dated July 23, 2003, the class actions as well as certain individual actions against the same defendants were transferred by the Judicial Panel on Multi-District Litigation to the Southern District of New York and are currently pending before Judge McKenna as, "In re Adelphia Communications Corp. Securities & Derivative Litigation, 03 MD 1529 (LMM)." On Dec. 5, 2003, Eminence Capital, LLC, Argent Classic Convertible Arbitrage Fund L.P., Argent Classic Convertible Arbitrage Fund (Bermuda) L.P., Argent Lowlev Convertible Arbitrage Fund Ltd., UBS O'Conner LLC f/b/o UBS Global Equity Arbitrage Master Ltd. and UBS O'Conner LLC f/b/o UBS Global Convertible Portfolio were appointed as lead plaintiffs in the consolidated class actions and Abbey Gardy, LLP, (n/k/a Abbey Spanier Rodd Abrams & Paradis, LLP) and Kirby McInerney & Squire were appointed as co-lead counsel in accordance with the federal securities laws. On Dec. 22, 2003, lead plaintiffs filed a complaint, which alleges claims for violations of Sections 11, 12(a)(2) and 15 of the U.S. Securities Act, 15 U.S.C. Section 77k, 77l(a)(2) and 77o, and Sections 10(b) and 20(a) of the Exchange Act, 15 U.S.C. Section 78j(b) and 78t(a), and Rule 10b-5, 17 C.F.R. Section 240.10b-5, the Trust Indenture Act of 1939, 15 U.S.C. Section 77jjj, 77mmm, 77ooo and 77www et seq. and state law against various defendants including Deloitte & Touche and the Banks. After filing the complaint, on March 8, 2004, the Settling Defendants, along with other defendants, moved to dismiss the complaint. The court has not yet ruled on several of the issues raised by the defendants' motions, but has partially granted and partially denied some of the motions. On or about June 30, 2005, at the suggestion of Judge McKenna, various parties to the class action agreed to participate in mediation to resolve the pending litigation. The various parties selected Judge Daniel Weinstein, a retired judge, to serve as the mediator. Pursuant to the court's directives, lead plaintiffs' counsel and counsel for Deloitte & Touche and the Banks entered into extensive negotiations under the supervision of Judge Weinstein. As a result of such discussions and their involvement in the extensive negotiation process, lead plaintiffs agreed to the settlements with Deloitte & Touche and the Banks. For more details, contact: (1) Adelphia Claims c/o Valley Forge Administrative Services, One Aldwyn Center, P.O. Box 220, Villanova, PA 19085-0220, Phone: 877-965-3300, E-mail: info@adelphiasettlement.com, Web site: http://www.adelphiasettlement.com; (2) Kirby McInerney & Squire, LLP, Phone: 1-888-529-4787; and (3) Abbey Spanier Rodd Abrams & Paradis, LLP, Phone: 1-800- 889-3701. WESBANCO INC: Reaches Settlement in American Bancorporation Suit ---------------------------------------------------------------- WesBanco, Inc. has reached a preliminary agreement under a mediation process to settle claims in a class action pending in the U.S. District Court for the Northern District of West Virginia. On March 1, 2002, the WesBanco, Inc., consummated its acquisition of American Bancorporation through a series of corporate mergers. At the time of the consummation of this transaction, American Bancorporation was a defendant in the suit, "Martin, et al. v. The American Bancorporation Retirement Plan, et al., Civil Action No. 5:2000-CV-168," which was pending in the U.S. District Court for the Northern District of West Virginia. The company became the principal defendant in this suit by reason of the merger. This case involves a class action against American Bancorporation by certain beneficiaries of the American Bancorporation Defined Benefit Retirement Plan, seeking to challenge benefit calculations and methodologies used by the Plan Administrator in determining benefits under the Plan which was frozen by American Bancorporation, as to benefit accruals, some years ago. The Plan had been the subject of a prior a case, "American Bancorporation Retirement Plan, et al. v. McKain, Civil Action No. 5:93-CV-110," which was also litigated in the U.S. District Court for the Northern District of West Virginia. The McKain case resulted in an Order entered by the District Court on Sept. 22, 1995, which directed American Bancorporation to follow a specific method for determining retirement benefits under the Plan. American Bancorporation has asserted that it has calculated the benefits in accordance with the requirements of the 1995 Order. The purported class of plaintiffs asserted that they are not bound by the 1995 Order since they were not parties to that proceeding and are seeking a separate benefit determination. The District Court in the current case limited the class of plaintiffs to a group of approximately 37 individuals and granted partial summary judgment to significantly reduce the scope and extent of the case. The court subsequently granted summary judgment in favor of the company on the remaining claims on March 31, 2004, and the plaintiff appealed the decision to the Fourth Circuit Court of Appeals. The Fourth Circuit Court of Appeals issued an opinion dated May 11, 2005, which reversed the District Court's earlier grant of summary judgment on behalf of the company, and remanded the case for further proceedings. The Appellate Court reversed the District Court's ruling that res judicata and collateral estoppel were applicable under the circumstances, which precluded the re-litigation of matters previously decided by the District Court in the earlier 1995 case involving the same pension plan. The parties subsequently filed renewed Motions for Summary Judgment on the issues of the benefit calculation and plaintiffs' claims under Section 204(h) of the Employee Retirement Income Security Act in the District Court. The Magistrate Judge assigned to the case issued a report and recommendation dated Jan. 18, 2006, to the court denying both parties' Motions for Summary Judgment on the benefit calculation issues but recommending to the court a key finding of fact on a material issue in the case. The key finding recommended would have sustained WesBanco's position that a timely summary plan description was distributed to plan participants addressing a benefit calculation consistent with the methodology used by the plan administrator. The court subsequently denied both parties' motions and declined to make the finding of fact recommended by the Magistrate. The court has not yet addressed the Section 204(h) notice issue. A recent mediation was held in the case, which has resulted in a tentative settlement of both the benefit claim and the 204(h) notice issue. The settlement will require approval of the court and the class members involved in the case, as well as confirmation of the benefit calculations agreed to in the settlement. It is anticipated that the approval process will take several months to complete. The suit is "Martin, et al v. American the Plan, et al., Case No. 5:00-cv-00168-WCB-JES," filed in the U.S. District Court for the Northern District of West Virginia under Judge W. Craig Broadwater. Representing the plaintiffs is Thomas M. Cunningham of Cassidy, Myers, Cogan & Voegelin, L.C., 1413 Eoff St., Wheeling, WV 26003, Phone: 304-232-8100, Fax: 304-232-8352, E-mail: tmc@cmcvlaw.com. Representing the company is Cynthia B. Jones of Steptoe & Johnson, PLLC - Morgantown, PO Box 1616, Morgantown, WV 26507- 1616, Phone: 304-598-8111, Fax: 304-598-8116, E-mail: jonescb@steptoe-johnson.com. WILLBROS GROUP: Settles Consolidated Tex. Securities Fraud Suit --------------------------------------------------------------- Willbros Group, Inc. reached an agreement in principle to settle a consolidated securities class action filed in 2005 against the company and certain of its current officers and a former officer of its international subsidiary, according to the company's report for the second quarter. Under the terms of the agreement in principle, Willbros and the plaintiffs will negotiate and seek court approval of the definitive settlement. The settlement will be funded by Willbros' insurance carrier, and will include the dismissal of all claims against all defendants. On May 18, 2005 a securities class action, "Legion Partners, LLP v. Willbros Group, Inc. et al.," was filed in the U.S. District Court for the Southern District of Texas against the company and certain of its present and former officers and directors. Thereafter, three nearly identical lawsuits were filed. Plaintiffs purport to represent a class composed of all persons who purchased or otherwise acquired Willbros Group, Inc. common stock and/or other securities between May 6, 2002 and May 16, 2005, inclusive. These complaints generally allege violations by the defendants of Section 10(b) of U.S. the Exchange Act, Rule 10b-5 under the Exchange Act and Section 20(a) of the Exchange Act and allege, among other things, that defendants made false or misleading statements of material fact about the company's financial statements. The plaintiffs seek unspecified monetary damages and other relief. On October 17, 2005, the court ordered these actions consolidated and appointed ADAR Investments, LLC as lead plaintiff and Bernstein Liebhard & Lifshitz of New York as lead plaintiff's counsel. As ordered by the court, the plaintiff filed a consolidated amended complaint on Jan. 9, 2006. The consolidated amended complaint alleges that WGI and certain of its present and former officers and directors, including Michael Curran, Warren Williams, and J. Kenneth Tillery, violated the Securities Exchange Act of 1934 through a series of false and misleading statements and a "scheme to defraud." The alleged misrepresentations and scheme to defraud relate to the activities of Mr. Tillery in Nigeria and Bolivia, certain alleged accounting errors, the restatement of past financial results, and alleged Foreign Corrupt Practices Act violations. The plaintiffs seek to recover damages on behalf of all purchasers of WGI common stock during the purported class period. The complaint seeks unspecified monetary damages and other relief. WGI filed a motion to dismiss the complaint on March 9, 2006, and briefing on that motion was completed on June 14, 2006, according to the company's June 16, 2006 Form 10-K filing for the period ended Dec. 31, 2005. The suit is "Legion Partners, LLP v. Willbros Group, Inc. et al., Case No. 4:05-cv-01778," filed in the U.S. District Court for the Southern District of Texas under Judge Keith P. Ellison. Consolidated Plaintiff Counsel Adar Investment Management, LLC Ronald J. Aranoff Bernstein Liebhard Lifshitz 10 East 40th Street 22nd Floor New York, NY 10016 Phone: 212-779-1414 Fax: 212-779-3218 E-mail: aranoff@bernlieb.com Defendant Counsel Willbros Group Inc. Laurie B. Smilan Michele E. Rose Latham & Watkins LLP 11995 Freedom Dr Ste 500 Reston, VA 20190-1000 Phone: 703-456-1000 Fax: 703-456-1001 E-mail: michele.rose@lw.com XCEL ENERGY: Appeal Planned on Minn. Court's Ruling in "Bender" --------------------------------------------------------------- Plaintiffs will appeal to the U.S. Court of Appeals for the Eighth Circuit a Minnesota federal court's decision denying plaintiff's motion for summary judgment in full in the class action, "Bender et al. vs. Xcel Energy." On July 2, 2004, five former NRG Energy, Inc. officers filed a lawsuit against the company in the U.S. District Court for the District of Minnesota. NRG is a former independent power production subsidiary that had filed for bankruptcy protection in May 2003. The lawsuit alleges, among other things, that Xcel Energy violated the Employee Retirement Income Security Act of 1974 by refusing to make certain deferred compensation payments to the plaintiffs. The complaint also alleges interference with ERISA benefits, breach of contract related to the nonpayment of certain stock options and unjust enrichment. It alleges damages of approximately $6 million. On Jan. 19, 2005, the company filed a motion for summary judgment. On July 26, 2005, the court issued an order granting the company's motion for summary judgment in part with respect to claims for interference with ERISA benefits, breach of contract for nonpayment of stock options and unjust enrichment. The court denied the company's motion in part with respect to the allegations of nonpayment of deferred compensation benefits. Plaintiffs and the company have filed additional cross motions for summary judgment, with oral arguments presented on Feb. 24, 2006. On May 17, 2006, the court granted the company's motion for summary judgment in full and denied the plaintiff's motion for summary judgment in full. Plaintiffs have filed notice of intent to appeal to the U.S. Court of Appeals for the Eighth Circuit. The suit is "Bender, et al. v. Xcel Energy, Inc., Case No. 0:04- cv-03117-ADM-FLN," on appeal from the U.S. District Court for the District of Minnesota under Judge Ann D. Montgomery with referral to Judge Franklin L. Noel. Representing the plaintiffs are Kelly A. Jeanetta and Maurice W. O'Brien of Miller O'Brien, 120 S. 6th St., Ste. 2400, Mpls, MN 55402, Phone: 612-333-5831, Fax: 612-342-2613, E-mail: kjeanetta@miller-obrien.com and bobrien@miller-obrien.com. Representing the defendants are: (1) James L. Altman and Daniel A.R. Shoemaker of Xcel Energy, 800 Nicollet Mall, Ste. 2900, Mpls, MN 55402, Phone: 612-215-4582, Fax: 6122154544, E-mail: james.l.altman@xcelenergy.com and daniel.a.shoemaker@xcelenergy.com; and (2) Timothy R. Thornton and Steven W. Wilson of Briggs & Morgan, PA, 80 S. 8th St., Ste. 2200, Minneapolis, MN 55402, Phone: 612-977-8550, Fax: 612-977-8650, E-mail: pvolk@briggs.com and swilson@briggs.com. XCEL ENERGY: Faces Suit in Miss. Over Carbon Dioxide Emissions -------------------------------------------------------------- Xcel Energy Inc. is defendant in a purported class action in the U.S. District Court for the Southern District of Mississippi over carbon dioxide emission. On Apr. 25, 2006 Xcel Energy received notice of the lawsuit, which named as defendant more than 45 oil, chemical and utility companies. The suit alleges that defendants' carbon dioxide emissions "were a proximate and direct cause of the increase in the destructive capacity of Hurricane Katrina." Plaintiffs allege in support of their claim, several legal theories, including negligence, and public and private nuisance and seek damages related to the hurricane. On July 19, 2006, the company filed a motion to dismiss the lawsuit in its entirety. The suit is "Comer, et al. v. Nationwide Mutual Insurance Co., et al., Case No. 1:05-cv-00436-LTS-RHW," filed in the U.S. District Court for the Southern District of Mississippi under Judge L. T. Senter, Jr. with referral to Judge Robert H. Walker. Representing the plaintiffs are: (1) Carlos A. Zelaya of Maples & Kirwan, LLC, 902 Julia Street, New Orleans, LA 70113, US, Phone: 504/569-8732, Fax: 504/525-6932; (2) Stephen M. Wiles and Randall Allan Smith of Smith & Fawer, 201 St. Charles Ave., Suite 3702, New Orleans, LA 70170, Phone: 504/525-2200, Fax: 504/525-2205, E- mail: smwiles@smithfawer.com and rasmith3@bellsouth.net; and (3) F. Gerald Maples F. Gerald Maples, PA, 902 Julia Street, New Orleans, LA 70113, Phone: 504/569-8732, E- mail: federal@geraldmaples.com. Representing the company are John G. Corlew and Katherine K. Smith of Watkins & Eager, P. O. Box 650, Jackson, MS 39205-0650, Phone: (601) 948-6470, E-mail: jcorlew@watkinseager.com and ksmith@watkinseager.com. Asbestos Alert ASBESTOS LITIGATION: Union Carbide Settles N.Y. Suit v. Carriers ---------------------------------------------------------------- Union Carbide Corporation reached settlements, through the 2006- 2nd quarter, with several carriers involved in a comprehensive asbestos-related insurance coverage case pending in the Supreme Court of the State of New York. In the suit filed September 2003, the Corporation sought to confirm its rights to insurance for various asbestos claims and to facilitate an orderly and timely collection of insurance proceeds. Although the Corporation has settlements in place concerning coverage for asbestos claims with many of its insurers, including those covered by the 1985 Wellington Agreement, this suit was filed against insurers that are not signatories to the Wellington Agreement. The Corporation also filed this suit against insurers that do not otherwise have agreements in place with the Corporation regarding their asbestos-related insurance coverage. Based in Houston, Texas, Union Carbide Corp. makes chemicals such as ethylene and propylene, which are converted into polyethylene and polypropylene. The Company also produces ethylene oxide used to make polyester fibers and ethylene glycol used to make antifreeze. ASBESTOS LITIGATION: Union Carbide Faces 121,128 Claims in 2Q06 --------------------------------------------------------------- Union Carbide Corporation recorded 121,128 pending asbestos- related claims against it at June 30, 2006, compared with 198,470 claims at June 30, 2005. The Corporation recorded 143,806 asbestos-related claims pending against it at March 31, 2006, compared with 198,682 claims at March 31, 2005. (Class Action Reporter, June 9, 2006) The Corporation is and has been involved in asbestos-related lawsuits filed in state courts during the past three decades. These suits allege personal injury from exposure to asbestos- containing products and seek actual and punitive damages. The alleged claims relate to products that the Corporation sold in the past, alleged exposure to asbestos-containing products located on the Corporation's premises, and its responsibility for asbestos suits filed against a former subsidiary, Amchem Products Inc. In many cases, plaintiffs are unable to demonstrate that they have suffered any compensable loss as a result of such exposure, or that injuries incurred in fact resulted from exposure to the Corporation's products. At June 30, 2006, the Corporation had 79,032 individual claimants, compared with 133,788 individual claimants at June 30, 2005. At June 30, 2006, the Corporation had 42,096 claimants with claims against both the Corporation and Amchem, compared with 64,682 claimants at June 30, 2005. Based in Houston, Texas, Union Carbide Corp. makes chemicals such as ethylene and propylene, which are converted into polyethylene and polypropylene. The Company also produces ethylene oxide used to make polyester fibers and ethylene glycol used to make antifreeze. ASBESTOS LITIGATION: Union Carbide Sees $87M Liabilities in 2Q06 ---------------------------------------------------------------- Union Carbide Corporation had US$87 million in current asbestos- related liabilities at June 30, 2006, compared with US$121 million at Dec. 31, 2005. The Corporation's current asbestos-related liabilities amounted to US$111 million at March 31, 2006. (Class Action Reporter, June 9, 2006) At June 30, 2006, the Corporation had US$1.346 billion in non- current asbestos-related liabilities, compared with US$1.384 billion at Dec. 31, 2005. Asbestos-related liabilities for pending and future claims amounted to US$1.4 billion at June 30, 2006. About 36 percent of the recorded liability related to pending claims while about 64 percent related to future claims. The Corporation's asbestos-related liability for pending and future claims was US$1.5 billion at Dec. 31, 2005. About 39 percent of the recorded liability related to pending claims and about 61 percent related to future claims. At June 30, 2006, the Corporation's current asbestos-related insurance receivables were US$76 million, compared with US$117 million at Dec. 31, 2005. At June 30, 2006, the Corporation's non-current asbestos-related receivables were US$763 million, compared with US$818 million at Dec. 31, 2005. The Corporation's receivable for insurance recoveries related to its asbestos liability was US$485 million at June 30, 2006 and US$535 million at Dec. 31, 2005. At June 30, 2006 US$391 million (US$398 million at Dec. 31, 2005) of the receivable for insurance recoveries was related to insurers that are not signatories to the Wellington Agreement and do not otherwise have agreements in place regarding their asbestos-related insurance coverage. Based in Houston, Texas, Union Carbide Corp. makes chemicals such as ethylene and propylene, which are converted into polyethylene and polypropylene. The Company also produces ethylene oxide used to make polyester fibers and ethylene glycol used to make antifreeze. ASBESTOS LITIGATION: Union Carbide's Defense Costs Drop to $28M --------------------------------------------------------------- Union Carbide Corporation recorded US$28 million in defense costs, for the six months ended June 30, 2006, pertaining to asbestos-related claims filed against the Corporation and its former subsidiary Amchem Products Inc. For the six months ended June 30, 2005, the Corporation recorded US$32 million in defense costs. To date as of June 30, 2006, the Corporation recorded US$447 million in aggregate defense costs. The Corporation recorded US$73 million in resolution costs, for the six months ended June 30, 2006, pertaining to asbestos- related claims filed against the Corporation and Amchem. This compares to US$98 million in resolution costs for the same period in 2005. As of June 30, 2006, the Corporation recorded US$1.138 billion aggregate resolution costs. Moreover, the Corporation had receivables for defense and resolution costs submitted to insurance carriers for reimbursement. At June 30, 2006, the Corporation had US$21 million in receivables for defense costs, compared with US$73 million at Dec. 31, 2005. At June 30, 2006, the Corporation had US$333 million in receivables for resolution costs, compared with US$327 million at Dec. 31, 2005. At June 30, 2006, the Corporation's total receivables for defense and resolution costs was US$354 million, compared with US$400 million at Dec. 31, 2005. Based in Houston, Texas, Union Carbide Corp. makes chemicals such as ethylene and propylene, which are converted into polyethylene and polypropylene. The Company also produces ethylene oxide used to make polyester fibers and ethylene glycol used to make antifreeze. ASBESTOS LITIGATION: Claims v. UIC, Detroit Stoker Fall to 9,496 ---------------------------------------------------------------- United Industrial Corporation and its subsidiary Detroit Stoker Co. faced about 9,496 total pending asbestos-related claims asserted in lawsuits, as of June 30, 2006. This figure is comparable with about 11,059 pending claims as of Dec. 31, 2005 and about 13,750 pending claims as of June 30, 2005. As of March 31, 2006, the Company and Detroit Stoker had about 10,159 asbestos-related claims asserted in lawsuits. (Class Action Reporter, May 26, 2006) As of June 30, 2006, the Company and Detroit Stoker were named in asbestos litigation pending in Arkansas, California, Louisiana, Michigan, Minnesota, Mississippi, New Jersey, New York, North Dakota and Rhode Island. The Company and Detroit Stoker made several products, in which some of the parts and components used asbestos-containing material made and provided by third parties. The use of ACMs ceased around 1981. Cases involving the Company and Detroit Stoker name 80 to 100 defendants. The Company and Detroit Stoker have not gone to trial with respect to any asbestos-related personal injury claims, although there is no assurance that trials may not occur in the future. As of June 30, 2006, neither the Company nor Detroit Stoker has been required to pay any punitive damages. Moreover, as of June 30, 2006, some previously pending claims have been settled or dismissed with or without prejudice. As of June 23, 2006, the Company estimated US$31,450,000 undiscounted liability for asbestos-related matters including damages and defense costs, compared with US$31,852,000 as of June 30, 2005. As of June 30, 2006, the Company had US$20,186,000 insurance receivables for asbestos-related liabilities, compared with US$20,434,000 as of June 30, 2005. Based in Hunt Valley, Maryland, United Industrial Corp., through subsidiary AAI Corp., makes automatic test equipment for avionics, electronic warfare test and training systems, training simulators for combat systems and aircraft maintenance, and unmanned aerial vehicle systems. ASBESTOS LITIGATION: Maremont's Claims Decrease to 60,500 in 2Q --------------------------------------------------------------- ArvinMeritor Inc.'s subsidiary, Maremont Corporation, had about 60,500 pending asbestos-related claims at June 30, 2006, compared with 61,100 claims at March 31, 2006. At Dec. 31, 2005, Maremont had 61,900 pending asbestos-related claims, compared with 61,700 claims at Sept. 30, 2005. Acquired by the Company in 1986, Maremont made asbestos- containing friction products from 1953 through 1977, when it sold its friction product business. Maremont and many other firms defend in lawsuits by individuals claiming personal injuries as a result of exposure to asbestos- containing products. In the cases where actual injury has been alleged, very few claimants have established that a Maremont product caused their injuries. Plaintiffs' lawyers often sue dozens or even hundreds of defendants in individual suits on behalf of hundreds or thousands of claimants, seeking damages against all named defendants irrespective of the disease or injury and irrespective of any causal connection with a particular product. In the nine months ended June 30, 2006, billings to insurance companies for indemnity and defense costs of resolved cases were about US$5 million, compared with US$8 million in the nine months ended June 30, 2005. Based in Troy, Michigan, ArvinMeritor Inc. makes components for commercial vehicles, like axles, transmissions, and clutches. The Company also makes components for light vehicles, such as door, roof, exhaust, wheels, and suspension systems. ASBESTOS LITIGATION: ArvinMeritor Pegs Liability at $54M in 2Q06 ---------------------------------------------------------------- ArvinMeritor Inc.'s asbestos-related liabilities totaled US$54 million as of June 30, 2006, in which US$14 million was current and US$40 million was non-current. As of Sept. 30, 2005, the Company's asbestos-related liabilities also totaled US$54 million, in which US$16 million was current and US$38 million was non-current. The Company's asbestos-related recoveries totaled US$34 million as of June 30, 2006, in which US$11 million was current and US$23 million was non-current. As of Sept. 30, 2005, the Company's asbestos-related recoveries totaled US$35 million, in which US$13 million was current and US$22 million was non-current. In the fourth quarter of fiscal year 2005, the Company's subsidiary, Maremont Corp., hired Bates White LLC to help estimate the cost of resolving pending and future asbestos- related claims that have been, and could reasonably be expected to be filed against Maremont. Maremont also tasked Bates White to help estimate the cost of Maremont's share of committed but unpaid settlements entered into by the Center for Claims Resolution. The Company engaged Bates White to update the study as of June 30, 2006. Bates White provided an estimate of the reasonably possible range of Maremont's obligation for asbestos personal injury claims over the next three to four years of US$33 million to US$49 million. Maremont determined that as of June 30, 2006, the most likely and probable liability for pending and future claims over the next four years is US$44 million. Based in Troy, Michigan, ArvinMeritor Inc. makes components for commercial vehicles, like axles, transmissions, and clutches. The Company also makes components for light vehicles, such as door, roof, exhaust, wheels, and suspension systems. ASBESTOS LITIGATION: ArvinMeritor Faces Rockwell Injury Suits ------------------------------------------------------------- ArvinMeritor Inc. co-defends in lawsuits alleging personal injury as a result of exposure to asbestos in certain components of Rockwell Automation Inc.'s automotive products years ago. The Company assumed liability for these claims during the spin- off of the automotive business to ArvinMeritor from Rockwell in 1997. A significant portion of the claims do not identify any of Rockwell's products or specify which of the claimants were exposed to asbestos attributable to Rockwell's products. Past experience has shown that most of the claimants will never identify any of Rockwell's products. The Company has historically been dismissed from most of these claims with no payment to claimants. Based in Troy, Michigan, ArvinMeritor Inc. makes components for commercial vehicles, like axles, transmissions, and clutches. The Company also makes components for light vehicles, such as door, roof, exhaust, wheels, and suspension systems. ASBESTOS LITIGATION: CNA Financial Has $1.505B for Claims in 2Q --------------------------------------------------------------- CNA Financial Corporation carried about US$1.505 billion of claim and claim adjustment expense reserves, net of reinsurance recoverables, for reported and unreported asbestos-related claims, as of June 30, 2006. As of Dec. 31, 2005, CNA carried US$1.554 billion and US$1.508 billion as of March 31, 2006. For the six months ended June 30, 2006, the Company recorded US$1 million of unfavorable asbestos-related net claim and claim adjustment expense reserve development, compared with US$7 million for the six months ended June 30, 2005. At June 30, 2006, the Company paid US$50 million for asbestos- related claims, net of reinsurance recoveries, compared with US$73 million at June 30, 2005. At June 30, 2006, the Company had 1,339 policyholders. At Dec. 31, 2005, the Company paid US$142 million for asbestos- related claims, net of reinsurance recoveries. At Dec. 31, 2005, the Company had 1,324 policyholders. The Company noted that about 80 percent of its total active asbestos accounts are classified as small accounts at June 30, 2006. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, such as workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: Court Mulls Protecting CNA from New Claims --------------------------------------------------------------- A U.S. Bankruptcy Court is scheduled to consider confirmation of a bankruptcy plan containing an injunction to protect CNA Financial Corporation from any future asbestos-related claims by the end of 2006. On Feb. 13, 2003, CNA had resolved asbestos related coverage litigation and claims involving A.P. Green Industries, A.P. Green Services and Bigelow-Liptak Corporation. Under the agreement, CNA is required to pay US$74 million, net of reinsurance recoveries, over a 10-year period commencing after the final approval of a bankruptcy plan of reorganization. The settlement resolves CNA's liabilities for all pending and future asbestos and silica claims involving A.P. Green Industries, Bigelow-Liptak and related subsidiaries, including alleged "non-products" exposures. The settlement received initial bankruptcy court approval on Aug. 18, 2003. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, like workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: Court Hears Closing Arguments in CNA Suit -------------------------------------------------------------- A New York State Court held closing arguments, on March 27, 2006, for asbestos-related insurance coverage litigation, in which CNA Financial Corporation is involved. Case No. 601037/03, styled Continental Casualty Co. v. Employers Ins. of Wausau et al., was filed in 2003 in New York County. The litigation had a defendant class of underlying plaintiffs, who have asbestos bodily injury claims against the former Robert A. Keasbey Co., which used to sell and install asbestos- containing insulation products in New York and New Jersey. Plaintiffs have filed bodily injury claims against Keasbey. However, Keasbey's involvement at a number of work sites was a highly contested issue. Therefore, the defense disputed the percentage of valid claims against Keasbey. CNA issued Keasbey primary policies for 1970-1987 and excess policies for 1972-1978. CNA has paid an amount equal to the policies' aggregate limits for products and completed operations claims in the confirmed CNA policies. Claimants against Keasbey alleged that CNA owes coverage under sections of the policies not subject to the aggregate limits. In the litigation, CNA and the claimants sought declaratory relief as to the interpretation of various policy provisions. On March 21, 2004, the Court dismissed a claim alleging bad faith and seeking unspecified damages. The Appellate Division, First Department, affirmed the ruling on March 31, 2005. On July 13, 2005, the trial in the Keasbey coverage action commenced. Closing arguments ended on Oct. 28, 2005. The Court reopened the record in January 2006 for additional evidentiary submissions and briefing. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, like workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: CNA Financial Deals With Burns & Roe Action ---------------------------------------------------------------- CNA Financial Corporation deals with insurance coverage disputes related to asbestos bodily injury claims against a bankrupt insured, Burns & Roe Enterprises Inc. These disputes are part of coverage litigation, which is stayed in view of Burns & Roe's bankruptcy, and an adversary proceeding in Case No. 00-41610, styled Burns & Roe Enterprises Inc., which is pending in the U.S. Bankruptcy Court for the District of New Jersey. Burns & Roe provided engineering and related services in connection with construction projects. When it filed for bankruptcy on Dec. 4, 2000, Burns & Roe asserted that it faced about 11,000 claims alleging bodily injury resulting from exposure to asbestos as a result of construction projects in which Burns & Roe was involved. CNA allegedly provided primary liability coverage to Burns & Roe from 1956-1969 and 1971-1974, along with certain project- specific policies from 1964-1970. The litigation involves disputes over the confirmation of the Plan of Reorganization in bankruptcy, the scope and extent of coverage afforded to Burns & Roe for its asbestos liabilities. On Dec. 5, 2005, Burns & Roe filed its Third Amended Plan of Reorganization. A confirmation hearing relating to that Plan is expected in 2007. Coverage issues will be determined in a later proceeding. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, such as workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: CNA Financial Units Face Suits in 4 States --------------------------------------------------------------- CNA Financial Corporation stated that asbestos related lawsuits have been initiated against two of its subsidiaries and other insurers in four jurisdictions: Ohio, Texas, West Virginia, and Montana. In about 70 Ohio actions filed to date, plaintiffs initially alleged that the defendants negligently performed duties undertaken to protect workers and the public from the effects of asbestos, altered evidence and conspired and acted in concert to harm the plaintiffs. Several of these suits are styled Varner v. Ford Motor Co., filed on June 12, 2003, and pending in the Ohio Court of Common Pleas; Peplowski v. ACE American Ins. Co., filed on April 1, 2004, and pending in the N.D. of Ohio; and Cross v. Garlock Inc., filed on Sept. 1, 2004, and pending in the Ohio Court of Common Pleas. In the most recent of these cases, plaintiffs have made negligent undertaking claims against the insurers. One of these suits is styled Ball v. Goodyear Tire & Rubber Co., filed on May 16, 2005, and pending in the Ohio Court of Common Pleas. The Cuyahoga County court granted insurers, including CNA, dismissals against an initial group of plaintiffs, ruling that insurers had no duty to warn plaintiffs about the dangers of asbestos and that there was no basis for spoliation, conspiracy and concert of action claims. That ruling was affirmed on appeal in the suit styled Bugg v. Am. Std. Inc., No. 84829 (Ohio Ct. App. May 26, 2005). The Cuyahoga County Court has continued to dismiss similar complaints and plaintiffs have either failed to appeal the dismissals or have voluntarily dismissed their appeals. Plaintiffs continued to file similar suits although all cases in that court have been dismissed. The only case that is pending is Peplowski, which was transferred to the federal Multi-District Litigation court in October 2004 and has been dormant since then. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, like workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: Continental Casualty Faces Adams Litigation ---------------------------------------------------------------- CNA Financial Corporation's subsidiary Continental Casualty Co. is faced with a purported class action against it and other insurers, alleging that the defendants violated West Virginia's Unfair Trade Practices Act in handling and resolving asbestos claims against five named asbestos defendants. Case Nos. 0-2C-1708 to 0-2C-1719 styled Adams v. Aetna Inc., et al. was filed on June 28, 2002 in the Circuit Court of Kanawha County, W.Va. The Court has stayed the Adams litigation pending a planned motion by plaintiffs to file an amended complaint that reflected two June 2004 decision of the W.Va. Supreme Court of Appeals. In June 2005, the court presiding over Adams and three similar putative class actions against other insurers told plaintiffs to file any amended complaints by June 13, 2005, and directed the parties to agree upon a case management order that would result in trial being commenced by July 2006. Under the Amended Complaint, CCC and the other defendant insurers have now been sued for alleged violations of the UTPA in connection with handling and resolving asbestos personal injury and wrongful death claims in W. Va. courts against all their insureds if those claims were resolved before June 30, 2001. CCC, along with other insurer defendants removed the Adams case to Federal court, Adams v. Ins. Co. of North America (INA) et al. (S.D. W. Va. No. 2:05-CV-0527). A plaintiffs' motion to remand the case to state courts was granted on March 30, 2006. Following remand to state court, CCC's motion to dismiss the Amended Complaint was denied as to living plaintiffs, but granted as to claims brought by two estates, and CCC subsequently answered the Amended Complaint, as it had been narrowed by the plaintiffs in the interim. The trial court has stated that it intends to try the case starting July 2007. Based in Chicago, Illinois, CNA Financial Corp provides commercial coverage, such as workers' compensation, general and professional liability, and other products for businesses and institutions. Loews Corp. owns 91 percent of CNA. ASBESTOS LITIGATION: Pending Claims v. Dana Corp. Remain at 76T --------------------------------------------------------------- Dana Corporation's pending asbestos-related product liability claims remained at about 76,000 at June 30, 2006, including 9,000 that were settled but awaiting final documentation and payment. At March 31, 2006, the Company had about 76,000 active pending asbestos-related product liability claims, including 9,000 claims that were settled but awaiting final documentation and payment. (Class Action Reporter, June 9, 2006) At Dec. 31, 2005, the Company had 77,000 claims, including 10,000 claims that were settled but awaiting final documentation and payment. At June 30, 2006, the Company had accrued US$96 million for indemnity and defense costs for pending asbestos-related product liability claims, compared with US$98 million at Dec. 31, 2005. The Company estimated its potential liability through 2020 to be within a range of US$70 million to US$120 million. At June 30, 2006, the Company had recorded US$79 million as an asset for probable recovery from its insurers for the pending and projected claims, compared with US$78 million at Dec. 31, 2005. At Dec. 31, 2005, the Company had recorded a receivable of US$8 million in connection with an October 2005 settlement agreement with one of its insurers. The Company received a payment of US$2 million in the 2006-1st quarter and US$6 million in the 2006-2nd quarter. Moreover, the Company had a net amount recoverable from its insurers and others of US$14 million at June 30, 2006, compared with US$15 million at Dec. 31, 2005. Through June 30, 2006, the Company had paid US$47 million to Center for Claims Resolution claimants and collected US$29 from its insurance carriers with respect to these claims. At June 30, 2006, the Company had a net receivable of US$13 million that it expects to recover from available insurance and surety bonds relating to these claims. Based in Toledo, Ohio, Dana Corp. makes car parts, in which its core products include axles, brakes, and driveshafts, as well as engine, filtration, fluid-system, sealing, and structural products. Dana filed for bankruptcy in 2006. ASBESTOS LITIGATION: Dow Chemical Has $1.346B Liabilities in 2Q --------------------------------------------------------------- The Dow Chemical Co.'s non-current asbestos-related liabilities stood at US$1.346 billion in the 2006-2nd quarter, compared with US$1.384 billion in the 2005-4th quarter. In the 2006-1st quarter, the Company's non-current asbestos- related liabilities stood at US$1.366 billion. (Class Action Reporter, May 19, 2006) In the 2006-2nd quarter, the Company's non-current asbestos- related insurance receivables stood at US$763 million, compared with US$818 million in the 2005-4th quarter. Based in Midland, Michigan, The Dow Chemical Co. makes plastics, chemicals, hydrocarbons, herbicides, and pesticides. Other Company products include polyethylene resins for packaging, fibers, films, and performance chemicals like acrylic acid. ASBESTOS LITIGATION: Anadarko Faces 3rd-Party Liability Lawsuits ---------------------------------------------------------------- Anadarko Petroleum Corporation continues to defend against personal injury claims, including claims by employees of 3rd- party contractors alleging exposure to asbestos, silica, and benzene while working at refineries in Texas, California, and Oklahoma. Union Pacific Resources Group Inc., acquired by the Company in 2000, and Howell Corp., acquired by the Company in 2002, sold the refineries before being acquired by the Company. For the three months ended June 30, 2006, the Company spent US$10 million for litigation charges and adjustments. For the six months ended June 30, 2006, the Company spent US$3 million. For the three months ended June 30, 2005, the Company did not spend for litigation charges and adjustments. For the six months ended June 30, 2005, the Company spent US$27 million. Adjustments to litigation charges increased income before income taxes US$8 million during the quarter ended March 31, 2006, compared with a decrease of US$27 million for the same period of 2005. (Class Action Reporter, May 26, 2006) Based in The Woodlands, Texas, Anadarko Petroleum Corp. explores for, develops, produces, and market oil, natural gas, natural gas liquids, and related products worldwide. More than half of the Company's reserves are found in Alaska, Louisiana, Texas, the mid-continent and Rocky Mountain regions, and the Gulf of Mexico. ASBESTOS LITIGATION: Navigators Group Links Loss to Settlements --------------------------------------------------------------- The Navigators Group Inc.'s 2006 cash flow from operations was reduced by gross loss payments of about US$14,000,000 for settled asbestos claims, according to a Company press release, dated July 31, 2006, reported to the U.S. Securities and Exchange Commission. Of the US$14,000,000, US$8,400,000 is due to be collected from reinsurers in subsequent accounting periods. In the 2006-1st quarter, the Company's 2006 cash flow from operations was reduced by gross loss payments of about US$1,900,000 for a settled asbestos-related claim of which US$1,100,000 will be collected from reinsurers in subsequent accounting periods. (Class Action Reporter, May 12, 2006) Consolidated cash flow from operations was US$16,672,000 for the six-month period ended June 30, 2006, compared with US$115,906,000 for the same period in 2005. Based in New York City, New York, The Navigators Group Inc.'s main insurance units, Navigators Insurance and NIC Insurance, write ocean and marine insurance including hull, energy, liability, and cargo insurance, as well as property insurance for onshore energy concerns. The Company also offers specialty liability and professional liability insurance. ASBESTOS LITIGATION: Crown Cork Wins Appeal in Robinson Suit ------------------------------------------------------------ The Court of Appeals of Texas, Houston, 14th District, upheld a prior court ruling in favor of Crown Cork & Seal Co. Inc. in an asbestos-related lawsuit filed by John and Barbara Robinson. The Panel, comprised of Chief Justice Adele Hedges and Justices Wanda McKee Fowler and Ken Thompson Frost, handed down the decision of Case No. 14-04-00658-CV on May 4, 2006. In 1956, Mr. Robinson joined the U.S. Navy and served for about 20 years as a boiler tender on several vessels. He maintained boilers, pipes, steam lines, and other machinery and equipment insulated with asbestos products, including insulation products of Mundet Cork Corp., Crown Cork's predecessor. Mr. Robinson was diagnosed with mesothelioma. The Robinsons sued Crown Cork, Mundet's successor, and others for damages caused by Mr. Robinson's exposure to asbestos. The Robinsons moved for partial summary judgment to establish Crown Cork's liability for the damages allegedly caused by Mundet's products. The 55th District Court Harris County, Texas Trial Court granted the Robinsons' motion as to compensatory damages, but not as to punitive damages. While the Robinsons' suit was pending, the Texas Legislature passed House Bill 4, which had a new affirmative defense limiting the liability of successor corporations for asbestos- related claims. After the Statute became effective, Crown Cork moved for summary judgment. The Trial Court granted the motion and severed the Robinsons' claims against Crown Cork from those against the other defendants. The Robinsons appealed. Mr. Robinson died while the case was pending, and Mrs. Robinson continued to pursue his claims under the wrongful death statute. Mrs. Robinson attacked the summary judgment on three grounds. First, Mrs. Robinson claimed that the legislation is unconstitutionally retroactive as applied to her because it extinguished a vested right. Next, she claimed that the law is unconstitutional because it is a special law, designed specifically to aid Crown Cork. Finally, she claimed that Crown Cork failed to establish as a matter of law each element of its affirmative defense. The Appeals Court overruled Mrs. Robinson's issues and affirmed the Trial Court's judgment. Based in Philadelphia, Pennsylvania, Crown Cork & Seal Co. Inc.'s main products include steel and aluminum cans for food, beverage, household, and other consumer products. The Company also makes metal and plastic caps, closures, and dispensing systems. The Company is a subsidiary of Crown Holdings Inc. ASBESTOS LITIGATION: Fla. Court Favors Kishes in Insurance Suit --------------------------------------------------------------- The District Court of Appeal of Florida, Third District, granted an appeal filed by John and Elizabeth Kish in an insurance asbestos-related lawsuit filed against Metropolitan Life Insurance Co. and other entities. The Panel, comprised of Judges Linda Ann Wells, Angel A. Cortinas, and Leslie B. Rothenberg, handed down the decision of Case No. 3D05-1538 on April 26, 2006. In August 2004, Mr. & Mrs. Kish sued in the Circuit Court for Miami-Dade County against 21 entities. The suit alleged negligence, strict liability, breach of warranty, civil conspiracy to commit fraud, and intentional infliction of emotional distress relating to injuries Mr. Kish sustained from asbestos exposure. Mr. & Mrs. Kish sought to hold Metropolitan Life Insurance Co. liable for Mr. Kish's injuries because in the 1930s and 1940s, the insurer allegedly agreed not to "fully share with the public" the results of industrial hygiene surveys and studies it had performed. The Circuit Court ruled that the fraud statute of repose, barred the Kishes' fraud claims. The Kishes appealed from the final summary judgment. As to Metropolitan Life's alleged fraudulent conduct, the 12- year period provided for redress protected the Kishes' interests when balanced against Metropolitan Life's right not to be called upon to defend a claim some 50 or 60 years old. The Appeals Court rejected the claim that application of the statute of repose resulted in an unconstitutional denial of access to the courts. Angel M. Reyes and Daniel F. O'Shea of Reyes & O'Shea represented John and Elizabeth Kish. Carlton Fields and Alina Alonso and Jeffrey A. Cohen; Martin Unger (Orlando, Fla.); Steptoe & Johnson and Stephen A. Fennell and Jeffrey E. McFadden (Washington, D.C.), represented Metropolitan Life Insurance Co. ASBESTOS LITIGATION: PPG Industries' Claims Remain at 116T in 2Q ---------------------------------------------------------------- PPG Industries Inc. faced asbestos-related lawsuits involving about 116,000 claims, as of June 30, 2006, in which about 7,000 of the 116,000 claims pending against the Company and its subsidiaries are premises claims. As of March 31, 2006, the Company faced asbestos-related suits involving about 116,000 claims. (Class Action Reporter, June 16, 2006) The Company's potential exposure relates to allegations by plaintiffs that it should be liable for injuries involving asbestos-containing thermal insulation products made and distributed by Pittsburgh Corning Corp., in which the Company and Corning Inc. are each 50 percent shareholders. On April 16, 2000, PC filed for Chapter 11 Bankruptcy in the U.S. Bankruptcy Court for the Western District of Pennsylvania in Pittsburgh, Pa. On May 14, 2002, PPG had agreed with several other parties, including certain of its insurance carriers, the official committee representing asbestos claimants in the PC bankruptcy, and the legal representatives of future asbestos claimants appointed in the PC bankruptcy, on the terms of a settlement arrangement relating to asbestos claims against PPG and PC. On March 28, 2003, Corning Inc. had separately reached its own arrangement with the representatives of asbestos claimants for the settlement of certain asbestos claims that might arise from PC products or operations. For 2006, the Company recorded that accretion expense associated with the asbestos liability would be about US$6 million a quarter. 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: AK Steel Contends With 401 Exposure Suits -------------------------------------------------------------- AK Steel Holding Corporation recorded about 401 asbestos-related exposure lawsuits pending against it, as of Dec. 31, 2005, according to the Company's Quarterly Report for the period ending June 30, 2006, filed with the U.S. Securities and Exchange Commission. Since 1990, the Company or its predecessor, Armco Inc., has been named as a defendant in suits alleging personal injury as a result of exposure to asbestos. Most of these suits have been filed on behalf of people allegedly exposed to asbestos while visiting the premises of a current or former Company facility. About half of these premises suits are from claims of exposure at a site in Houston, Tex. that has been closed since 1984. The Company noted that specific dollar claims for damages were included in the complaints filed in 129 of the 401 cases pending at Dec. 31, 2005 in which it is a defendant. Those 129 cases involve a total of almost 2,520 plaintiffs and 15,665 defendants. In 2005, the Company recorded 186 newly filed claims, compared with 153 in 2004. In 2005, the Company recorded 112 claims disposed of, compared with 163 in 2004. In 2005, the Company settled US$1.3 million for claims, compared with US$1 million in 2004. Since the onset of asbestos claims against the Company, five asbestos claims against it have proceeded to trial in four separate cases. All five concluded with a verdict in favor of the Company. Based in Middletown, Ohio, AK Steel Holding Corp. makes carbon, stainless, and electrical steels. Sales to automakers comprise nearly half of the Company's business. ASBESTOS LITIGATION: Diamond Offshore Faces Suit in Miss. Courts ---------------------------------------------------------------- Diamond Offshore Drilling Inc. co-defends in an asbestos-related lawsuit filed in the Circuit Courts of the State of Mississippi. The suit alleged that defendants manufactured, distributed or utilized drilling mud containing asbestos and, in the Company's case, allowed drilling mud to have been utilized aboard its offshore drilling rigs. The plaintiffs sought an award of unspecified compensatory and punitive damages. The Company expects to receive complete defense and indemnity from Murphy Exploration & Production Co. under the terms of its 1992 asset purchase agreement with them. Based in Houston, Texas, Diamond Offshore Drilling Inc. operates as a contract offshore oil and gas driller that descends depths of 7,500 feet. Loews Corp. owns about 54 percent of the Company. ASBESTOS LITIGATION: Cytec Industries Inc. Has 10T Claims in 2Q --------------------------------------------------------------- Cytec Industries Inc. recorded 10,000 claimants in asbestos- related suits in the six months ended June 30, 2006, compared with 18,100 in the year ended Dec. 31, 2005. In the six months ended June 30, 2006, the Company noted 10,900 claimants associated with claims closed, compared with 12,000 claims in the year ended Dec. 31, 2005. In the six months ended June 30, 2006, the Company noted 2,800 claimants associated with claims opened, compared with 2,100 claimants in the year ended Dec. 31, 2005. The Company is subject to suits and claims incidental to the conduct of the Company or certain of its predecessors' businesses, including suits and claims relating to product liability, personal injury including asbestos, environmental, contractual, employment and intellectual property matters. At June 30, 2006, the asbestos liability was US$47.5 million, compared with US$47.8 million at Dec. 31, 2005. At June 30, 2006, the insurance receivable related to the liability as well as claims for past payments was US$35 million, compared with US$34.7 million at Dec. 31, 2005. Based in West Paterson, New Jersey, Cytec Industries Inc. produces chemicals from which it makes engineered materials, specialty chemicals, and additives used in treating water and in industrial processes. ASBESTOS LITIGATION: Lawsuits v. Mine Safety Drop to 280 in 2Q06 ---------------------------------------------------------------- Mine Safety Appliances Co. noted that 10 percent of the 2,800 respiratory products lawsuits filed against it are attributable to asbestosis and other combined injuries. According to the June 2, 2006 Class Action Reporter, the Company noted about 290 asbestos-related respiratory products suits filed against it. The 2,800 suits involve respiratory protection products allegedly manufactured and sold by the Company. Collectively, these suits represent a total of about 23,000 plaintiffs. About 90 percent of these suits involve plaintiffs alleging they suffer from silicosis. These suits allege that these conditions resulted in part from respirators that were negligently designed or manufactured by the Company. Based in Pittsburgh, Pennsylvania, Mine Safety Appliances Co. makes protective equipment for miners and workers in the fire service, construction, and homeland security industries. The Company produces air-purifying respiratory equipment, gas masks, and head protection gear. Mine Safety draws about 15 percent of its sales from the U.S. military. ASBESTOS LITIGATION: Celanese Units Face 650 Pending Cases in 2Q ---------------------------------------------------------------- Celanese Corporation's U.S. subsidiaries, Celanese Ltd. and CNA Holdings Inc., continue to face about 650 asbestos-related cases. In the three months ended June 30, 2006, 18 new cases were filed against the Company and 26 cases were resolved. As of March 31, 2006, Celanese Ltd. and CNA Holdings Inc. had about 660 asbestos-related cases filed against it. (Class Action Reporter, May 26, 2006) Since many of these cases involve numerous plaintiffs, the Company is subject to claims significantly in excess of the number of actual cases. The Company has reserves for defense costs related to claims arising from these matters. Based in Dallas, Texas, Celanese Corp. operates as global hybrid chemical firm. The company's business involves processing chemical raw materials, such as ethylene and propylene, and natural products, including natural gas and wood pulp, into value-added chemicals and chemical-based products. ASBESTOS LITIGATION: Hanson PLC Notes 127,750 Open Claims in 2Q --------------------------------------------------------------- Hanson PLC recorded about 127,750 outstanding claimants at the end of June 2006, a reduction of 3,600 compared with 131,350 claimants at the end of December 2005. In the first half of 2006, the Company noted about 2,750 new asbestos claimants filed in the first half of 2006, compared with 6,700 filed in the same period in 2005. In the first half of 2006, the Company resolved about 6,350 claims, in which over 90 percent were dismissals, compared with about 8,850 in the same period in 2005. Gross costs in the first half of 2006 were US$27.1 million, compared with US$22.2 million in the first half of 2005, US$21 million in the second half of 2005 and an annual cost of US$59.3 million in 2004. In the first half of 2006, the Company used US$2.2 million of the insurance asset, resulting in a net cost before tax of US$24.9 million, compared with US$15.4 million in the same period in 2005. Gross costs in the second half of 2006 are expected to be similar to those in the first half of this year. An asbestos provision is maintained for those gross costs considered to be both probable and reliably estimable. This is equivalent to about eight years of gross cost at an average of around US$60 million per annum. The US$30 million charge for the half-year is equivalent to GBP8.4 million after tax and discounting. This is offset by more insurance secured in the first half of GBP14.7 million. Hanson's U.S. subsidiaries, which are affected by asbestos, will continue to litigate and negotiate for more insurance cover and intend to settle only those cases with proven disease and product identification. Based in London, United Kingdom, Hanson PLC produces aggregates, ready-mixed concrete, bricks, and concrete pipe and building products. Other operations include quarries, marine dredging, and recycling. ASBESTOS LITIGATION: CIRCOR Units Face Suits with 22T Plaintiffs ---------------------------------------------------------------- CIRCOR International Inc. stated that its subsidiaries, Leslie, Spence, and Hoke, defend in asbestos-related claims, filed on behalf of about 22,000 plaintiffs, against 50 to 400 defendants. Of about 22,000 plaintiffs who have sued the Company's subsidiaries, all but about 700 have been filed in Mississippi. Of the plaintiffs who have sued CIRCOR units, all but about 650 have been filed in Mississippi. (Class Action Reporter, May 12, 2006) In some instances, the Company has also been named individually and as successor in interest to one or more of these units. These cases have been filed in state courts in Alabama, California, Connecticut, Georgia, Illinois, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, Montana, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Texas, Utah, Virginia, Washington and Wyoming with most claimants having filed their claims in Mississippi. In Mississippi, the courts have rendered decisions and the legislature has passed laws aimed at curbing certain abusive practices by plaintiff attorneys, in which large numbers of unrelated plaintiffs would be grouped in the same case against hundreds of defendants. As a result of the recent changes, many of these "mass filings," including some cases in which CIRCOR units have been named as defendants, have been or are to be dismissed. Based in Burlington, Massachusetts, CIRCOR International Inc. makes instrumentation and fluid regulation products, including precision valves, tube and pipe fittings, and regulators for hydraulic, pneumatic, cryogenic, and steam systems. ASBESTOS LITIGATION: Central Hudson Records 1,161 Cases in 2Q06 --------------------------------------------------------------- CH Energy Group Inc.'s subsidiary, Central Hudson Gas & Electric Corporation, had 1,161 remaining pending asbestos-related claims out of 3,283 cases filed against it as of June 30, 2006. Of the cases no longer pending against Central Hudson, 1,972 have been dismissed or discontinued without payment by Central Hudson, and Central Hudson has settled 150 cases. As of March 31, 2006, Central Hudson had 1,158 pending asbestos- related cases out of 3,280 cases. Of the cases no longer pending against Central Hudson, 1,972 have been dismissed or discontinued without payment by Central Hudson, and Central Hudson has settled 150 cases. (Class Action Reporter, May 26, 2006) Central Hudson is unable to assess the validity of the remaining asbestos suits. Accordingly, it cannot determine the ultimate liability relating to these cases. Based in Poughkeepsie, New York, CH Energy Group Inc., through Central Hudson, provides electricity to almost 290,000 customers and natural gas to more than 67,000 customers along the Hudson River in New York. Subsidiary Central Hudson Enterprises oversees the Group's non-regulated businesses in the Northeast and Mid-Atlantic, including petroleum product distribution and energy management services. ASBESTOS LITIGATION: CPChem, ConocoPhillips Dispute Over Claims --------------------------------------------------------------- Chevron Phillips Chemical Co. LLC is involved with certain asbestos-related lawsuits for which the financial responsibility between CPChem and parent ConocoPhillips is disputed. CPChem, ConocoPhillips, and parent Chevron Corp. are attempting to resolve whether ConocoPhillips or CPChem has financial responsibility for these suits. ConocoPhillips currently manages and defends in these suits. In the event the financial responsibility for these suits is ultimately determined to rest with CPChem, CPChem may be required to record a charge to operations that could be material to the period reported. Based in The Woodlands, Texas, Chevron Phillips Chemical Co. LLC produces ethylene, propylene, polyethylene, and polypropylene, which are sometimes used as a component for the Company's other products such as pipe. Most of the Company's operations are located in the U.S. Chevron Corporation and ConocoPhillips share ownership of CPChem. ASBESTOS LITIGATION: TRW Automotive Faces Claims v. Subsidiaries ---------------------------------------------------------------- TRW Automotive Holdings Corporation said that certain of its subsidiaries deal with asbestos-related claims, which seek damages for illnesses alleged to have resulted from exposure to asbestos used in certain components sold by the Company's units. The Company said that most of the claimants were assembly workers at U.S. automobile makers. Most of these claims name as defendants manufacturers and suppliers of products allegedly with asbestos. To the extent any of the products sold by the Company's subsidiaries and at issue in these cases had asbestos, management said that the asbestos was encapsulated. Management said that a small portion of the claimants has will develop any asbestos-related impairment. Many of these cases have been dismissed without any payment. Moreover, the Company has significant insurance coverage with solvent carriers with respect to these claims. Based in Livonia, Michigan, TRW Automotive Holdings Corp. makes components for automakers like Ford, DaimlerChrysler, Volkswagen, and General Motors. Products include chassis systems and safety systems such as airbags, security electronics, and seat belts. Other products include fasteners, body controls, and engine valves. ASBESTOS LITIGATION: Navigators Group Sets Aside Claims Reserves ---------------------------------------------------------------- The Navigators Group Inc. stated that it has established reserves for asbestos exposures at June 30, 2006 and Dec. 31, 2005. The reserves are for: -- The 2005-4th quarter settlements of two large claims aggregating about US$28 million for excess insurance policy limits exposed to class action suits against two insureds involved in the making or distribution of asbestos products, each settlement to be paid over two years; -- The 2004 settlement of a large claim about US$25 million exposed to a class action suit which settlement will be paid over seven years starting in June 2005; -- Other insureds not directly involved in the making or distribution of asbestos products, but that have more than incidental asbestos exposure for their purchase or use of products that had asbestos; and -- Attritional asbestos claims that could be expected to occur over time. The Company's exposure to asbestos liability stems from marine liability insurance written on an occurrence basis during the mid-1980s. In general, the Company's participation on those risks is in the excess layers, which requires the underlying coverage to be exhausted prior to coverage being triggered in the Company's layer. In many instances, the Company is an insurer who participates in the defense and ultimate settlement of these claims, and it is a minor participant in the overall insurance coverage and settlement. The Company has now settled four large asbestos claims where excess policy limits were exposed to class action suits, which gave rise to the reserve action taken in the 2003-4th quarter. At June 30, 2006, ceded asbestos paid and unpaid losses recoverable were US$26.2 million of which US$14.2 million was due from Equitas. The Company expects that it would pay about 74 percent of the gross asbestos reserves over the next two years. Based in New York City, New York, The Navigators Group Inc.'s main insurance units, Navigators Insurance and NIC Insurance, write ocean and marine insurance including hull, energy, liability, and cargo insurance, as well as property insurance for onshore energy concerns. The Company also offers specialty liability and professional liability insurance. ASBESTOS LITIGATION: Hartford Fin. Has $2.32B Liability in 2Q06 --------------------------------------------------------------- The Hartford Financial Services Group Inc. recorded US$2.327 billion net asbestos-related claims liability for the three months ended June 30, 2006, compared with US$2.224 billion net for the three months ended March 31, 2006. For the three months ended June 30, 2006, the Company incurred US$265 million net for claims and claim adjustment expenses. For the three months ended June 30, 2006, the Company paid US$162 million net for claims and claim adjustment expenses. For the six months ended June 30, 2006, the Company incurred US$267 million net for claim and claim adjustment expenses. For the six months ended June 30, 2006, the Company paid US$231 million net for claims and claims adjustment expenses. As of June 30, 2006, the Company recorded US$2.65 billion net reserves, in which US$2.34 billion was for asbestos claims and US$319 million was for environmental claims. The recorded net reserves are within an estimated range, unadjusted for covariance, of US$2.07 billion to US$3.15 billion. Based in Hartford, Connecticut, The Hartford Financial Services Group Inc. offers personal and commercial property-casualty insurance products, including homeowners, auto, and workers' compensation. Established in 1810, the Company sells its products through about 11,000 independent agencies and more than 100,000 registered broker-dealers. ASBESTOS LITIGATION: SCC Affiliates Contend With ASARCO Lawsuits ---------------------------------------------------------------- Southern Copper Corporation stated that its direct and indirect parent corporations, including Americas Mining Corp. and Grupo Mexico, have been named parties in litigation involving ASARCO LLC. On Aug. 9, 2005, ASARCO filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code before the U.S. Bankruptcy Court in Corpus Christi, Tex. ASARCO's bankruptcy case is being joined with the bankruptcy cases of its subsidiaries. In 2005, certain ASARCO subsidiaries filed bankruptcy petitions in connection with alleged asbestos liabilities. ASARCO has informed SCC that by utilizing the Chapter 11 process, ASARCO can achieve an orderly restructuring of its business and finally resolve its asbestos and environmental claims. In March 2003, AMC purchased its interest in SCC from ASARCO. In August 2002 the U.S. Department of Justice brought a claim alleging fraudulent conveyance in connection with AMC's then- proposed purchase of SCC from ASARCO. The action was settled pursuant to a Consent Decree dated Feb. 2, 2003. In October 2004, AMC, Grupo Mexico, Mexicana de Cobre and other parties, not including SCC, were named in a suit filed in New York State court in connection with alleged asbestos liabilities, which suit claimed, that AMC's purchase of SCC from ASARCO should be voided as a fraudulent conveyance. Based in Lima, Peru, Southern Copper Corp. mines, smelts, and refines copper at its Toquepala and Cuajone mines in Peru. It produces blister copper and copper cathodes at the smelter and refinery in Ilo, Peru. The Company also recovers silver and molybdenum from copper ore. Americas Mining Corp., a subsidiary of Grupo Mexico, owns 75 percent of the Company. ASBESTOS LITIGATION: Sealed Air Updates WR Grace Suit in Canada --------------------------------------------------------------- Sealed Air Corporation updated a lawsuit, in which the Company is involved, regarding W.R. Grace and Co. and its Canadian subsidiaries. In April 2001, Grace's subsidiary Grace Canada Inc. had obtained an order of the Superior Court of Justice, Commercial List, Toronto, Ontario, Canada recognizing the Ch. 11 actions in the U.S. involving Grace Canada Inc.'s U.S. parent corporation and other U.S. affiliates of Grace Canada Inc. The order enjoined all new actions and stayed all current proceedings against Grace Canada Inc. related to asbestos under the Canadian Companies' Creditors Arrangement Act. In November 2005, upon motion by Grace Canada Inc., the Court ordered an extension of the injunction and stay to actions involving asbestos against Sealed Air and its Canadian affiliate and the Attorney General of Canada, which had the effect of staying all of the Canadian actions. The stay has been extended through Oct. 1, 2006. Grace's proposed plan of reorganization provided that these claims will be paid by the trusts to be established under the Bankruptcy Code as part of Grace's plan of reorganization. It is expected that the defendants will ask the Canadian courts to enforce the terms of the plan of reorganization. If Grace's final plan does not include comparable provisions or if the Canadian courts refuse to enforce Grace's final plan of reorganization in the Canadian courts, and if Grace is unwilling or unable to defend and indemnify Sealed Air and its units in these cases, then Sealed Air could be required to pay damages. Based in Saddle Brook, New Jersey, Sealed Air Corp.'s Food Packaging segment produces Cryovac shrink films, absorbent pads, and foam trays used by food processors and supermarkets to protect meat and poultry. ASBESTOS LITIGATION: Sealed Air Accrues $106.9M Interest in 2Q06 ---------------------------------------------------------------- Sealed Air Corporation recorded US$106.9 million asbestos- related accrued interest charge at June 30, 2006, compared with US$90.3 million at Dec. 31, 2005. At March 31, 2006, recorded an asbestos-related interest charge of US$98.6 million. (Class Action Reporter, May 12, 2006) The Company recorded a charge of US$850.1 million in the 2002- 4th quarter, of which US$512.5 million covered a cash payment that the Company is required to make upon the effectiveness of a plan of reorganization in the bankruptcy of W.R. Grace & Co. The Company expects to fund this payment by using a combination of accumulated cash and future cash flows from operations and funds available under its US$500 million senior unsecured multi- currency credit facility or its accounts receivable securitization program or a combination of these alternatives. The cash payment of US$512.5 million accrued interest at a 5.5 percent annual rate, which is compounded annually, from Dec. 21, 2002 to the date of payment. Based in Saddle Brook, New Jersey, Sealed Air Corp.'s Food Packaging segment produces Cryovac shrink films, absorbent pads, and foam trays used by food processors and supermarkets to protect meat and poultry. ASBESTOS LITIGATION: Calif. County Drops Suit v. Sempra, SDG&E -------------------------------------------------------------- The County of San Diego, Calif. has withdrawn litigation against Sempra Energy and subsidiary, San Diego Gas & Electric Co., in an asbestos-related environmental lawsuit. The suit sought civil penalties for alleged violations of environmental standards applicable to the abatement, handling and disposal of asbestos-containing materials during a 2001 demolition of a natural gas storage facility in Lemon Grove, Calif. SDG&E and two employees, environmental supervisor Jacquelyn McHugh and environmental specialist David Williamson, have also been charged in a federal criminal indictment for these standards and with related charges of conspiracy and having made false statements to governmental authorities. In January 2005, Sempra Energy and SDG&E received a grand jury subpoena from the US Attorney's Office in San Diego seeking documents related to this matter and are fully cooperating with the investigation. (Class Action Reporter, March 4, 2005) SDG&E stated that the maximum fines and penalties that could reasonably be assessed against it with respect to these matters would not exceed US$750,000. A jury trial is set for January 2007. Based in San Diego, California, Sempra Energy distributes natural gas to about 6.2 million customers and electricity to 1.3 million customers through its Southern California Gas (SoCalGas) and San Diego Gas & Electric (SDG&E) utilities. ASBESTOS LITIGATION: Foster Wheeler Gains From $79.6M Settlement ---------------------------------------------------------------- Foster Wheeler Ltd. benefited from an asbestos settlement received from an insurer, and adding US$79.6 million to the Company's 2006-2nd quarter profits, Reuters reports. The Company said it continues to litigate claims against other insurers as it works toward settlements. Excluding the asbestos settlement, a charge of US$12.3 million related to debt reduction, and stock option expenses, the Company earned US$43.1 million, or US$0.61 a share, above the average forecast of US$0.41 a share among analysts polled by Reuters Estimates. The Company said that net earnings were US$106.2 million, or US$1.53 a share, compared with US$28.2 million, or US$0.55 a share, a year earlier. Revenue rose 42 percent to US$745.3 million. Based in Clinton, New Jersey, Foster Wheeler Ltd. builds business process and power generating facilities. The Company operates through two business groups. It also builds, owns, and leases cogeneration and independent power projects. ASBESTOS LITIGATION: DEQ Charges Ore. Hospital $10.2T for Breach ---------------------------------------------------------------- The Oregon state Department of Environmental Quality has issued a US$10,200 fine to the Oregon State Hospital for asbestos- related violations during a water line project, The Associated Press reports. The DEQ fined the hospital for allowing asbestos to accumulate in the open and for allowing the contractor Emery & Sons Construction to perform asbestos-related work without a license. The DEQ fined Emery & Sons US$3,600. Emery & Sons vice president Bill Martinak said the Company would appeal. The DEQ said the hospital hired Emery & Sons to install a water line. In January 2006, workers dug into an old asbestos- insulated pipeline, in which the asbestos was reportedly left in a pile of dirt and debris. Jane Hickman, the DEQ administrator or compliance and enforcement, said that officials at the psychiatric hospital should have known about the hazardous material because a 1990 survey documented asbestos sites on the 144-acre hospital campus. State hospital officials had said the asbestos was about 200 feet from the nearest residential area. Jim Sellers, spokesman for the Department of Human Services, said the department had not yet decided yet whether it would appeal the fine, but he said it would examine the 1990 survey and "find whatever lessons we can in the experience." ASBESTOS LITIGATION: Relief Trust Reports ZAR91M Payout in 2 Yrs ---------------------------------------------------------------- John Doidge, chairman of The Asbestos Relief Trust, said that the Trust, established to compensate asbestosis claimants, paid out more than ZAR91 million in 1,378 claims in the past two years, BusinessDay reports. In his report, Mr. Doidge said, "The manager's report shows that to date we have been able to compensate 1,378 people suffering with an asbestos related disease. The amount paid to these people is ZAR91,371,598." The average payment per claim was ZAR68,000. Since the first claim in March 2004, the Trust had worked with accredited claims handlers and set up offices in South African locations like Johannesburg, Kuruman and Mpumalanga, to ensure claims were processed speedily. Established by Gencor after extensive litigation was filed against the Company, the Trust compensates ex-miners, or people living in mining areas, who suffer from asbestos-related disease, as well as the families of people who have died due to asbestos exposure. To qualify for compensation, the claimant must have been employed by one of the qualifying operations during certain qualifying times when the mines were owned by Gencor, Msauli, or Griqualand Exploration & Finance Co. Mr. Doidge said the highest payments to beneficiaries were made in the past 12 months with the Trust paying out ZAR49,976,510 to more than 600 claimants. ASBESTOS LITIGATION: W.Va. Court Receives Ambrose, Ullum Suits -------------------------------------------------------------- The Kanawha Circuit Court in West Virginia received two jointly filed asbestos-related lawsuits, each naming 108 defendants, on July 26, 2006, The West Virginia Record reports. Charles and Nancy Ambrose filed the first suit. The suit said 71-year-old Mr. Ambrose has asbestosis and mesothelioma, two lung diseases related to asbestos exposure, from years of working as a steelworker. The complaint stated Mr. Ambrose worked out of Local 809 at various steel mills, including Weirton Steel Corp. and Wheeling- Pittsburgh Steel Corp. Loretta Ullum filed the second suit, individually and as the Executrix of the Estate of William Ullum. The suit said Mr. Ullum died of asbestosis and mesothelioma after years of working as a laborer out of Local 1149. Mrs. Ambrose and Mrs. Ullum made loss of consortium claims. The suits were filed through Pittsburgh, Pa. attorney David Chervenick of Goldberg, Persky and White. A visiting judge will be assigned Case Nos. 06-C-1465 and 06-C- 1466. ASBESTOS LITIGATION: Probe Tags Engineer's Death to Mesothelioma ---------------------------------------------------------------- An inquest in the U.K. has concluded that the death of 61-year- old engineer Rodney Brown was linked to mesothelioma, an asbestos-related lung cancer, icSouthLondon.co.uk reports. For over 30 years, Mr. Brown maintained the heating system at Guy's Hospital in Lambeth and later developed mesothelioma. He fell into a coma and died on May 6, 2006 after surgery at the hospital to treat strain on his heart caused by the tumor. At the inquest, a statement Mr. Brown wrote as part of a compensation claim was read out, saying he received no protection from the toxic dust he handled during his job. Mr. Brown said, "I was not provided with a protective mask. When the whole hospital was cleared of asbestos this was one of the areas found to contain the most." Southwark Coroner John Sampson recorded a verdict of death from industrial disease. ASBESTOS LITIGATION: Court Disallows Biersdorf Claims v. Grace -------------------------------------------------------------- At the request of W.R. Grace and Co. and the other Debtors, the U.S. Bankruptcy Court disallowed 53 non-traditional asbestos property damage claims filed by Biersdorf and Associates PA, for claimants in Minneapolis, Minn. The claimants seek recovery for "stigma" damage to property. The Claimants are residents of a Northeast Minneapolis neighborhood where a Superfund site is located. From the 1950s to 1989, the Debtors disposed of asbestos-contaminated vermiculite by offering and distributing it throughout the neighborhood as "free crushed rock." From 2000 to the present, the U.S. Environmental Protection Agency inspected over 1,600 homes in the claimants' neighborhood and remediated over 200 as result of the contamination. In 2003, EPA began its fourth, and likely final, year of outdoor properties cleanup. In a memorandum opinion, Judge Judith Fitzgerald rules that the Claimants failed to introduce any evidence suggesting that Minnesota law would permit a property owner to pursue a claim solely for stigma to property. Judge Fitzgerald refers to Jackson v. Reiling, 249 N.W. 2d 896 (Minn. 1977), which establishes that no claim is compensable when it involves remote and speculative damages. She maintains that the Bankruptcy Court "cannot create a new cause of action which has never been applied in Minnesota courts." In a supplemental memorandum filed with the Bankruptcy Court in support of protocol for disposition of Speights & Runyan's property damage claims involving buildings in Canada, the Debtors tell Judge Fitzgerald that the Canadian PD Claims are not enforceable under applicable Canadian law and, thus, should be disallowed under Section 502(b)(1) of the Bankruptcy Code. Pursuant to the Court's recent decision involving the Minneapolis Stigma Claims, if Canadian law does not recognize the Canadian PD Claims, then there is no basis on which they should be allowed, states James E. O'Neill, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub LLP, in Wilmington, Del. Mr. O'Neill states that the Canadian court has full authority to adjudicate the Debtors' objections to the Canadian PD Claims in a proceeding under Section 18.6 of the Companies' Creditors Arrangement Act. Since the commencement of the CCAA Proceeding, Mr. O'Neill relates, the Canadian Court has provided assistance to the Debtors' Chapter 11 case by entering an order that affect interests of the Debtors and Canadian third-parties asserting claims involving the Debtors. Those orders are consistent with the broad authority granted to the Canadian Court by the CCAA to aid the Bankruptcy Court in the resolution of the Debtors' cases. Mr. O'Neill clarifies that the Debtors, in their pending request for a scheduling order regarding certain PD claims, are not asking the Bankruptcy Court to abstain from addressing the Canadian PD Claims or to relinquish its jurisdiction over those Claims. Rather, the Debtors are proposing the use of the Canadian Court's expertise in the CCAA Proceeding to determine if the Canadian PD Claim can be allowed as enforceable claims against Grace under Canadian law. According to Mr. O'Neill, the three independent doctrines that U.S. bankruptcy courts have invoked to defer to foreign courts and tribunals for adjudication of disputes that are otherwise within the bankruptcy court's jurisdiction are: -- International comity, -- Concurrent jurisdiction, and -- The doctrine of forum non conveniens. Accordingly, the Debtors insist that the Bankruptcy Court should authorize them to litigate the enforceability of the Canadian PD Claims in the CCAA Proceeding because: (1) The Canadian Court has the strongest interest in resolving those claims; (2) Speights filed the Claims with a specific intent to bypass the Canadian law's application; and (3) Adjudication of the Debtors' objections in Canada would best serve the interests of judicial efficiency and the convenience of affected parties. (W.R. Grace Bankruptcy News, Issue No. 113; Bankruptcy Creditors' Service, Inc., 215/945-7000) ASBESTOS LITIGATION: Owens Corning Reports Move to Pay Trustees --------------------------------------------------------------- The Sixth Amended Plan of Reorganization of Owens Corning and the other Debtors provides for the establishment of a trust into which all asbestos-related personal injury claims will be channeled. Under the Plan, the occurrence of the "Effective Date" is subject to conditions precedent that, inter alia: -- Trustees for the Asbestos Personal Injury Trust will have accepted their appointment as Asbestos Personal Injury Trustees and will have executed the Asbestos Personal Injury Trust Agreement; and -- The individuals designated to serve as members of the Trustee's Advisory Committee for the Trust will have accepted their appointment as TAC members. James J. McMonagle, the Court-appointed legal Future Claimants Representative in the Debtors' Chapter 11 cases, and the Official Committee of Asbestos Personal Injury Claimants have interviewed about 80 candidates to serve as prospective trustees and directors in several cases, including the Owens Corning cases, in connection with the formation of asbestos personal injury trusts. However, the Trustees have not yet been selected. Once selected, Marla R. Eskin, Esq., at Campbell & Levine LLC, at Wilmington, Delaware, tells the Court that the Trustees will commence taking the steps necessary to have the Asbestos Personal Injury Trust operational and ready to receive, process and pay asbestos personal injury claims as soon as reasonably practicable after the Effective Date. The FCR and ACC expect that the Trustees will want to retain separate counsel in connection with carrying out their duties. Pursuant to the Asbestos Personal Injury Trust Agreement, the Trustees are required to consult with the TAC and the FCR on certain issues relating to the Asbestos Personal Injury Trust, including issues relating to the Trust's general implementation and administration. Each member of the TAC will be entitled to compensation from the Asbestos Personal Injury Trust in the form of a reasonable hourly rate set by the Trustees for attendance at meetings or other conduct of the Trust's business. The TAC members will also be reimbursed for reasonable out-of-pocket costs and expenses. The FCR and ACC want to have the Trustees and the TAC commence establishing the Asbestos Personal Injury Trust and taking the other steps necessary to have the Trust ready to be functioning by the Effective Date. As part of these preparations, the Trustees will be meeting with representatives of the Debtors, the FCR, the ACC and proposed TAC members. By this motion, the FCR and ACC ask the Court to authorize the Debtors: a. To reimburse the Trustees for the reasonable attorneys' fees and out-of-pocket expenses incurred in connection with the establishment of the Asbestos Personal Injury Trust and other actions necessary to have the Trust ready to be operational by the Effective Date; b. If the TAC members undertake activities prior to confirmation, to reimburse those members for reasonable out-of- pocket expenses incurred in connection with the activities and pay the members a reasonable hourly rate established by the Trustees for meetings attended or other conduct of the Trust's business; c. Pay the Trustees for meetings attended at the per diem rate as set forth in the Asbestos Personal Injury Trust Agreement and agreed on by the FCR and the FCC; and d. Pay the premiums for errors and omissions insurance to be issued on the Trustees' behalf. Under the Asbestos Personal Injury Trust Agreement, each of the Trustees will be entitled to receive US$60,000 per annum from the Asbestos Personal Injury Trust for their services. The Managing Trustee will receive US$75,000 for his service, plus: -- A per diem allowance for telephonic meetings or other Asbestos Personal Injury Trust business performed for US$1,500; -- A per diem allowance for in-person meetings for US$2,500; and -- The reimbursement of reasonable out-of-pocket costs and expenses. Ms. Eskin points out that the reimbursable fees and expenses will be of no cost to the Debtors' estates since payment will be offset against the US$1.25 billion payment to the Asbestos Personal Injury Trust on the Effective Date. The FCR and ACC further ask Judge Judith Fitzgerald to authorize the Debtors to make the payments without further authorization of, or approval by, the Bankruptcy Court. "By authorizing the Debtors to reimburse the Trustees and the TAC members now . . . the Debtors will be in a position to consummate the Sixth Amended Plan shortly after confirmation," Ms. Eskin maintains. (Owens Corning Bankruptcy News, Issue No. 138; Bankruptcy Creditors' Service, Inc., 215/945-7000) ASBESTOS LITIGATION: Sealed Air Corp Mulls Settlement with Grace ---------------------------------------------------------------- Sealed Air Corporation anticipates that a settlement agreement between the Company and W.R. Grace & Co. would become effective upon Grace's emergence from bankruptcy with a plan of reorganization. On Nov. 27, 2002, the Company agreed with the committees appointed to represent asbestos claimants in Grace's bankruptcy case, to resolve all current and future asbestos-related claims made against the Company and its affiliates, the fraudulent transfer claims, successor liability claims, and indemnification claims by Fresenius Medical Care Holdings Inc. and affiliated companies in connection with a Cryovac transaction. Completed on March 31, 1998, the Cryovac transaction was a multi-step transaction, which brought the Cryovac packaging business and the former Sealed Air Corp.'s business under the common ownership of the Company. On Dec. 3, 2002, the Company's Board of Directors approved the agreement. The Company received notice that both of the committees had approved the agreement as of Dec. 5, 2002. The parties to the agreement in principle signed a definitive settlement agreement as of Nov. 10, 2003. On June 27, 2005, the U.S. Bankruptcy Court in the District of Delaware, where the Grace bankruptcy case is pending, signed an order approving the definitive settlement agreement. In January 2005, Grace filed a proposed plan of reorganization and related documents with the Bankruptcy Court. Objections were filed, and the Company does not know whether the final plan would be consistent with the terms of the settlement agreement or if the other conditions to the Company's obligation to pay the settlement amount will be met. If these conditions are not met or not waived by the Company, the Company would not be obligated to pay the settlement amount. Based in Saddle Brook, New Jersey, Sealed Air Corp.'s Food Packaging segment produces Cryovac shrink films, absorbent pads, and foam trays used by food processors and supermarkets to protect meat and poultry. New Securities Fraud Cases INFOSONICS CORP: Scott + Scott Sets Lead Plaintiff Deadline ----------------------------------------------------------- Scott + Scott, LLC, reminds investors they have only until Aug 14, 2006 to request that the Court for appointment as lead plaintiff in a securities-fraud action against Infosonics Corp. and certain officers. On July 14, 2006, Scott+Scott, LLC, filed a class action in the U.S. District Court for the Southern District of California on behalf of Infosonics securities purchasers during the period May 8, 2006, through June 12, 2006. The complaint alleges that defendants made false and misleading statements regarding certain of the company's warrants, which were improperly "marked to market" in violation of Generally Accepted Accounting Principles. After being "marked to market," the warrants remained booked as a liability at the end of the quarter ended March 31, 2006, when they should have been reclassified as equity as of Feb. 17, 2006, the date upon which the U.S. Securities and Exchange Commission declared the company's Form S-3 effective, thereby registering the shares underlying the warrants. The immediate result was to artificially inflate the company's net income results for the quarterly period ended March 31, 2006, a condition that remained uncorrected until the end of the Class Period. Finally, on June 12, 2006, the company revealed that it had restated certain portions of the financial statements for the quarter ended March 31, 2006. On this news, the price of Infosonics' stock fell from $24.22 to $17.05, a drop of $7.17, on more than three times the normal trading volume. For more details, contact Scott + Scott, LLC, Phone: (800) 404- 7770 and (860) 537-5537, E-mail: scottlaw@scott-scott.com, Web site: http://www.scott-scott.com. RAMBUS INC: Johnson & Perkinson Files Securities Fraud Suit ----------------------------------------------------------- Johnson & Perkinson filed a class action on behalf of plaintiff and a proposed class of purchasers of securities of Rambus, Inc. during the period December 12, 2001 through July 18, 2006. The Complaint alleges that Rambus and certain officers and directors violated Sections 10(b), 14(a) and 20(a) of the U.S. Securities Exchange Act of 1934 by making false and misleading statements and omissions concerning Rambus's improper and undisclosed practice of backdating options conferred on certain executives which made it appear that such options were issued upon dates when the market price of Rambus stock was lower than actual market price on the actual grant dates. 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 materially false and misleading because they contained statements concealing Rambus's practice of backdating stock options. The plaintiff is represented by J&P, which has extensive experience in prosecuting investor class actions and actions involving financial fraud. J&P is a litigation boutique dedicated to maximizing shareholders' returns and keeping the lead plaintiffs involved in the litigation. Attorneys Johnson and Perkinson are both former employees of the Securities and Exchange Commission. Members of the firm have prosecuted complex class actions on behalf of plaintiffs in the areas of securities and consumer fraud since 1985. Based in South Burlington, Vermont, the firm has prosecuted leading actions on behalf of defrauded investors against numerous public companies resulting in the recovery of many millions of dollars and has been singled out for its excellence by various courts. The firm is litigating, or recently resolved litigation, as lead or co-lead counsel in securities class actions against Xerox, Priceline, i2, Allaire, and Exchange Applications, and serves on the Executive Committee in the Global Crossing case. Interested parties may no later than (60) days from July 19, 2006, move the court for appointment as lead plaintiff. For more details, contact James F. Conway, III of Johnson & Perkinson, Phone: 1888-459-7855, E-mail: jconway@jpclasslaw.com. SAFENET INC: Kahn Gauthier Announces N.Y. Securities Suit Filing ---------------------------------------------------------------- Kahn Gauthier Swick, LLC announces that a class action was filed in the U.S. District Court for the Southern District of New York on behalf of shareholders who purchased, exchanged or otherwise acquired the common stock and other securities of SafeNet, Inc. between March 31, 2003 and May 18, 2006. The action against SafeNet and certain of the company's executive officers charges violations of federal securities laws. On July 26, 2006, the company stated that it would be restating its earnings for the fourth quarter of 2002 that its year-ending 2002 financial statements are unreliable, and that future restatements may occur. SafeNet's accounting problems stem from the illegal backdating of stock options granted to senior management, which is the subject of ongoing investigations by the SEC and the U.S. Attorney for the Southern District of New York. Interested parties have only until October 2, 2006, to move the court for appointment as lead plaintiff. For more details, contact Managing Partner Lewis Kahn of KGS, Phone: 1-866-467-1400, ext. 100, or 504-648-1850, E-mail: lewis.kahn@kglg.com. ********* A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the Class Action Reporter. Submissions via e-mail to carconf@beard.com are encouraged. Each Friday's edition of the CAR includes a section featuring news on asbestos-related litigation and profiles of target asbestos defendants that, according to independent researches, collectively face billions of dollars in asbestos-related liabilities. ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Glenn Ruel Senorin, Maria Cristina Canson, and Janice Mendoza, Editors. Copyright 2006. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *