/raid1/www/Hosts/bankrupt/CAR_Public/070222.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, February 22, 2007, Vol. 9, No. 38
Headlines
APPRAISAL COS: Ind. Fraud Suit Defendants File Motion to Dismiss
ARIZONA: PUSD to Settle Suit Over Racial Segregation at Schools
AUSTRALIA: Yambuk Farmers to File Lawsuit Over January Fire
CAI INC: Faces Litigation Over 2006 Explosion at Mass. Facility
COLORADO: Veteran Inmate Sues Over Disabilities Act Violations
COLLEGIATE PACIFIC: Del. Investor's Suit Voluntarily Dismissed
COLLEGIATE PACIFIC: Faces New Stockholder's Litigation in Del.
CONAGRA FOODS: Faces Wash. Suit Over Contaminated Peanut Butter
DOLE FRESH: Recalls Cantaloupes Contaminated with Salmonella
EMERY WORLDWIDE: Still Faces Ohio Suit Alleging WARN Violations
GILMAN & CIOCIA: June 2007 Hearing Set for Del. Investors Suit
HOSPIRA INC: Continues to Face ERISA Violations Lawsuit in Ill.
JJB SPORTS: To Face Lawsuit for Fixing Prices of Football Shirts
KRISPY KREME: Court Grants Final Approval for $75M Settlement
LEGENDS RESORT: Timeshare Owners Prepare Suit After Trading Halt
MORTGAGE LENDERS: Anticipate a Wave of Suits Over Loan Terms
NTL INC: Court Rejects "Gordon" Motion for Attorneys' Fees Share
OFFICE DEPOT: Reaches $16M Settlement in "Birch" Litigation
OHIO: Sixth Circuit Allows Suit Over Cadaver Photos to Proceed
PAPA JOHN'S: Calif. Court Grants Class Status to Employees' Suit
REFCO INC: Plan Administrators File Omnibus Objection to Claims
RETAIL VENTURES: Faces Lawsuits Over Credit Card, Data Thefts
SMILECARE: Dental Hygienist Complains of Unpaid Overtime Work
TENNESSEE: Judge Haynes Sides with Senior Services Patients
TOBACCO LITIGATION: Appeals Court Cuts $590M Award in "Scott"
TYSON FOODS: Summary Judgment Motion Rejected in Kan. Labor Suit
UNITED STATES: Veterans Affairs Faces Ala. Suit Over Data Theft
UST LIQUIDATING: Plaintiff's Right to Appeal Calif. Suit Lapses
VESTIN REALTY: Still Faces Lawsuit Over Vestin Fund II Merger
VITA SPECIALTY: Recalls Sauces Over Undeclared Milk Content
New Securities Fraud Cases
GLOBALSTAR INC: Schiffrin Barroway Files Securities Suit in N.Y.
NEW CENTURY: Charles Johnson Announces Securities Suit Filing
*********
APPRAISAL COS: Ind. Fraud Suit Defendants File Motion to Dismiss
----------------------------------------------------------------
Defendants in a class action concerning an alleged mortgage
fraud scheme from Virginia to North Carolina and Kentucky have
filed a motion to dismiss the suit with the U.S. District Court
for the Southern District of Indiana.
Defendants in the suit are:
-- Robert Penn,
-- Ace Appraisal Services,
-- Frederick Bauter,
-- Brown Funding Inc.,
-- Brian Carrington,
-- EU Group, LLC,
-- Land Economics, LLC,
-- Sharon Penn,
-- People's Trust Mortgage, LLC,
-- Amy Pollard,
-- Robert Pollard,
-- Susan L. Ruhana,
-- Tamara Scott-Penn,
-- Showhomes Property Management, LLC,
-- KTD Enterprises, Inc.,
-- Excel Realty Group, LLC,
-- Homevestors, LLC,
-- Realty Options, LLC,
-- Beulah Penn, and
-- Jerry Jacques
Filed in October 2006, the 15-count, 25-page suit alleges that
local residents unwittingly were involved in a mortgage fraud
scheme to buy modestly priced homes, inflate the appraisals and
resell (flip) them to unsuspecting buyers for the inflated
price.
It alleges that Robert Penn and his associates formed a group of
individuals and legitimate business entities in order to defraud
mortgage lenders.
The Penns are alleged to have recruited participants from North
Carolina and Virginia by inviting them to participate in an
"investment opportunity or real estate club."
Allegations for one or more defendants named in the suit
include:
-- fraud, theft by deception, civil RICO (Indiana Racketeer
Influenced and Corrupt Organization Act);
-- civil conspiracy; criminal mischief;
-- unjust enrichment;
-- negligence against appraisers;
-- negligent misrepresentation against the appraisers;
-- indemnity;
-- invasion of privacy;
-- breach of fiduciary duty;
-- constructive fraud and
-- federal RICO.
"[D]efendants' actions affected interstate commerce in that they
involved persons and properties located at least within the
states of Indiana, Virginia and Kentucky," according to court
documents.
The suit seeks actual and punitive damages, expenses, attorneys'
fees, compensation for loss of credit rating and other relief to
which plaintiffs are entitled.
The suit is "Watkins et al. v. Penn et al., Case No. 1:06-cv-
01473-JDT-TAB," filed in the U.S. District Court for the
Southern District of Indiana under Judge John Daniel Tinder,
with referral to Judge Tim A. Baker.
Representing defendants are:
(1) Bruce D. Brattain of Brattan & Minnix, 151 N. Delaware
Street, Suite 760, Indianapoilis, IN 46204, Phone:
(317) 231-1750, Fax: (317) 231-1760, E-mail:
batmi5@aol.com;
(2) Curtis J. Butcher of Curtis J. Butcher & Associates, 8
West Main Street, Carmel, IN 46032, Phone: (317) 846-
2561, Fax: (317) 846-2597, E-mail:
curtisbutcherlaw@msn.com;
(3) Erin A. Clancy and Richard Alan Young, both of
Kightlinger & Gray, 151 North Delaware Street, Suite
600, Indianapolis, IN 46204, Phone: (317) 638-4521,
Fax: (317) 636-5917, E-mail: eclancy@k-glaw.com or
ryoung@k-glaw.com;
(4) Laura Brooke Conway, Matthew A. Griffith and Mark W.
Rutherford all of Thrasher Buschmann Griffith & Voelkel
PC, 151 North Delaware Street, Suite 1900,
Indianapolis, IN 46204, Phone: (317) 686-4773, Fax:
(317) 686-4777, E-mail: conway@indiana-attorneys.com or
griffith@indiana-attorneys.com or
rutherford@indiana-attorneys.com;
(5) Donald F. Foley and Dana L. Luetzelschwab, both of
Foley & Turner, 342 Massachusetts Avenue, Suite 300,
Indianapolis, IN 46204, Phone: (317) 261-0900, Fax:
(317) 261-0200, E-mail: donf@foleyandturner.com or
danal@foleyandturner.com; and
(6) Douglas W. Langdon and Joshua Taylor Rose, both of
Frost Brown & Todd, LLC, 120 West Spring Street, Suite
400, New Albany, IN 47150, Phone: (812) 948-2800, Fax:
(812) 581-1087, E-mail: dlangdon@fbtlaw.com or
jtrose@fbtlaw.com.
Representing plaintiffs are:
(1) Kathleen A. Farinas of George & Sipes, 600 Inland
Building, 156 East Market Street, Indianapolis, IN
46204, Phone: 317-637-6071, Fax: 317-685-6505;
(2) Linda S. George, Aaron Tracy Milewski and W. Russell
Sipes, all of George & Sipes, 156 East Market Street,
Suite 600, Indianapolis, IN 46204, Phone: (317) 637-
6071, Fax: (317) 685-6505, E-mail: lg@lgrslaw.com or
atm@lgrslaw.com or wrsipes@lgrslaw.com; and
(3) Scott A. Kainrath of Kainrath Law Firm, PC, 155 East
Market Street, Suite 400, Indianapolis, IN 46204,
Phone: (317) 632-9411, Fax: (317) 236-0481, E-mail:
scott@kainrathlaw.com.
ARIZONA: PUSD to Settle Suit Over Racial Segregation at Schools
---------------------------------------------------------------
Page Unified School District (PUSD) continues to settle a
protracted class action that alleges the district segregates its
two elementary schools as "white" and "Indian," The Arizona
Daily Sun reports.
On Feb. 6, PUSD's Governing Board agreed to pay $30,000 as
plaintiffs' attorney fees.
The board has already agreed to address underlying community
issues related to ethnic disparities at the two schools. The
issues will be taken at future board meetings, according to PUSD
Superintendent James Walker.
Court documents revealed that Dino Communities for Equal
Education, Inc. filed the civil rights lawsuit in November 2005
on behalf of its group and nine other individuals. Those
individuals are parents of Desert View Elementary School
students.
Generally, the suit alleges the vast majority of students
attending Desert View in 2004-05 were American Indian and that
these students were denied access to the district's other
primary school, Lake View Elementary School, which has a more
equitable student makeup.
It also alleges that the district's "open enrollment" policy
allows the segregation to occur and that PUSD's "Elementary
Reconfiguration" plan admits segregation at the two schools.
AUSTRALIA: Yambuk Farmers to File Lawsuit Over January Fire
-----------------------------------------------------------
Local law firm Maddens Lawyers is preparing a class action on
behalf of Yambuk farmers whose properties were damaged as a
result of a January bushfire that swept through bush and
pastoral lands in the area, just west of Port Fairy in South
West Victoria, the ABC Regional Online reports.
Initial investigation by the Country Fire Authority reports that
the fire was started by the use of welding equipment. While no
homes were destroyed in the blaze, Maddens Lawyers attorney,
Gary Foster, pointed towards the loss of income-making ability
for the farms in the area as grounds for action.
Mr. Foster, said compensation is being sought for 11 burnt-out
landowners in the January bushfire in Yambuk who are part of the
class action the law firm is pursuing. He added that loses
could run to hundreds of thousands of dollars in some cases.
For more information, contact Gary Foster of Maddens Lawyers, 1a
Liebig Street, PO Box 320, Warrnambool Victoria 3280, Phone:
(03) 5560 2000, Fax: (03) 5560 2099.
CAI INC: Faces Litigation Over 2006 Explosion at Mass. Facility
---------------------------------------------------------------
CAI, Inc., and Arnel Co. were named as defendants in a proposed
class action filed in a Massachusetts court over an explosion at
an ink-and-paint factory near Danversport that happened three
months ago, The Boston Globe reports.
The suit was filed by Rachelle Borrelli of Waltham, a boat
owner, whose craft was destroyed at Liberty Marina, which is
next to the destroyed factory. She is seeking compensation for
individuals, boat owners, homeowners, businesses, and others
affected by the blast.
Attorney Michael Germano of Boston filed the lawsuit on behalf
Ms. Borrelli, who did not have enough insurance to cover her
losses. He believes that there are many other property owners
like his client.
The lawsuit, however, still must be certified as a class action
by a judge. A lawyer for CAI said he would argue against the
case being allowed as a class action.
W. Paul Needham, a Boston-based lawyer, argues that there is a
fairly finite number of people, maybe in the hundreds affected
by this. He doesn't think the number will meet the requirements
of a class action.
Judge Richard Welch of the Newburyport Superior Court recently
granted a motion filed by Arnel to transfer the case into a
special Business Litigation session at Suffolk Superior Court.
For more details, contact The Law Offices of Michael F. Germano,
63 Atlantic Avenue, 3rd Floor, Boston, MA 02110, Phone: (617)
367-5911, Fax: (617) 227-3384, Web site:
http://www.bostoncaraccidentattorney.com.
COLORADO: Veteran Inmate Sues Over Disabilities Act Violations
--------------------------------------------------------------
Chris Bernard Hughes, an inmate who described himself as a
bipolar and schizophrenic American veteran, filed a lawsuit in
the U.S. District Court for the District of Colorado, alleging
that he was illegally denied mental health care while he was at
the Denver jail, TheDenverChannel.com reports.
Named defendants in the suit are:
-- the Colorado Department of Corrections,
-- Ari Zavaras,
-- Steve Crigler,
-- city and county of Denver,
-- Thomas Moore, and
-- RRK Enterprises Inc.
The lawsuit sought class-action status for an estimated 100 to
400 people.
It alleges violations of the Americans with Disabilities Act and
of Mr. Hughes' constitutional rights because he didn't receive
proper mental health treatment and because his parole was
revoked.
According to the lawsuit, Mr. Hughes pleaded guilty in 2000 to a
crime related to auto theft. Sentencing orders in 2001 stated
that Mr. Hughes should receive mental health treatment and
medications. It was not until mid-2006 that Mr. Hughes saw a
psychiatrist who gave him the medications he needed.
The lawsuit said staffing issues, including high turnover, lack
of training and variation in staff quality, were part of the
problem.
Mr. Hughes sought unspecified damages.
The suit is "Hughes v. Colorado Department of Corrections et
al., Case No. 1:07-cv-00354-WYD," filed in the U.S. District
Court for the District of Colorado under Judge Wiley Y. Daniel.
Representing plaintiffs is Anne Thomas Sulton of Sulton Law
Offices, P.O.Box 2763, Olympia, WA 98507, Phone: 609-468-602, E-
mail: annesulton@comcast.net.
COLLEGIATE PACIFIC: Del. Investor's Suit Voluntarily Dismissed
--------------------------------------------------------------
A purported stockholder's class action filed in the Court of
Chancery of the state of Delaware in and for New Castle County
against Collegiate Pacific, Inc. was voluntarily dismissed
without prejudice.
On Dec. 15, 2005, a stockholder of Sport Supply Group, Inc.,
Jeffrey S. Abraham, as trustee of the Law Offices of Jeffrey S.
Abraham Money Purchase Plan, dated Dec. 31, 1999, f/b/o Jeffrey
S. Abraham, filed a lawsuit against:
-- Emerson Radio Corp.,
-- Geoffrey P. Jurick,
-- Arthur J. Coerver,
-- Harvey Rothenberg,
-- the company, and
-- Michael J. Blumenfeld
The plaintiff filed the lawsuit as a class action on behalf of
the public stockholders of Sport Supply in connection with:
* the Sept. 8, 2005, agreement and plan of merger pursuant
to which the company was to have acquired the remaining
shares of the outstanding capital stock of Sport Supply
that it did not already own; and
* the company's subsequent acquisition of an additional
1.66 million shares of Sport Supply for approximately
$9.2 million cash from an institutional stockholder.
The suit alleges the defendants breached certain fiduciary
duties owed to Sport Supply's stockholders and the company was
unjustly enriched from its use of certain Sport Supply assets.
The lawsuit seeks damages against Emerson Radio Corp. and Mr.
Jurick for breach of fiduciary duty to Sport Supply stockholders
and a derivative claim against the company and the defendant
directors for breach of fiduciary duty and unjust enrichment in
connection with the use of Sport Supply assets without due
compensation.
The defendant directors and the company filed their answer to
the complaint on March 15, 2006. Defendants Emerson and Mr.
Jurick filed a motion to dismiss Count I of the complaint
alleging breach of fiduciary duty as to them.
The court issued its opinion on July 5, 2006 and ordered that
Count I as to Emerson and Mr. Jurick be dismissed for failure to
state a claim upon which relief can be granted.
This lawsuit was voluntarily dismissed, without prejudice in
January 2007, according to the company's Feb. 14 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
period ended Dec. 31, 2006.
For more details, contact the Law Offices of Jeffrey S. Abraham,
60 East 42nd Street, Suite 4700, New York, NY 10165, Phone:
(212) 692-0555.
COLLEGIATE PACIFIC: Faces New Stockholder's Litigation in Del.
--------------------------------------------------------------
Collegiate Pacific, Inc. is a defendant in a purported
stockholder's class action filed in the Court of Chancery of the
state of Delaware in and for New Castle County, according to the
company's Feb. 14 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the period ended Dec. 31, 2006.
On Sept. 21, 2006, Jeffrey S. Abraham, as Trustee of the Law
Offices of Jeffrey S. Abraham Money Purchase Plan, dated Dec.
31, 1999, f/b/o Jeffrey S. Abraham, filed a complaint in the
Court of Chancery of the State of Delaware in and for New Castle
County (C.A. No. 2435-N) against:
-- the company;
-- Michael J. Blumenfeld;
-- the four directors of Sport Supply Group, Inc.;
-- Arthur J. Coerver;
-- Harvey Rothenberg;
-- Robert W. Philip;
-- Thomas P. Treichler; and
-- Sport Supply, as a nominal defendant.
Plaintiff is a stockholder of Sport Supply and brought the
action as a class action on behalf of all Sport Supply minority
stockholders in connection with the Sept. 20, 2006, agreement
and plan of merger pursuant to which the company acquired the
remaining shares of the outstanding capital stock of SSG that it
did not already own.
Plaintiff alleges, among other things, that the $8.80 cash price
per share of Sport Supply common stock paid to the minority
stockholders in the merger is unfair in that it fails to take
into account the value of Sport Supply, its improving financial
results and its value in comparison to similar companies.
Plaintiff also alleges that the process by which the merger
agreement was arrived at could not have been the product of good
faith and fair dealing in that the company and Mr. Blumenfeld
acted in bad faith by taking various actions to depress the
price of Sport Supply common stock and dry up the market
liquidity in such shares, all in an effort to effect the merger.
In addition, the plaintiff alleges that the directors of Sport
Supply breached their fiduciary duties of good faith and loyalty
to the plaintiff and the other minority stockholders in the
merger agreement negotiations.
The plaintiff requested that the merger be enjoined or in the
alternative, damages be awarded to the Sport Supply minority
stockholders.
On Jan. 31, 2007, the plaintiff amended his complaint and is
requesting that the court certify plaintiff as the class
representative of the proposed class and award plaintiff and the
class compensating and/or rescissory damages.
Plaintiff also seeks the costs of bringing the action, including
reasonable attorneys fees and experts' fees.
For more details, contact the Law Offices of Jeffrey S. Abraham,
60 East 42nd Street, Suite 4700, New York, NY 10165, Phone:
(212) 692-0555.
CONAGRA FOODS: Faces Wash. Suit Over Contaminated Peanut Butter
---------------------------------------------------------------
A class action was filed against ConAgra Foods in the U.S.
District Court for the Western District of Washington.
The lawsuit was filed on behalf of named plaintiffs James
Daniels and Linda Oswald, and all other individuals who became
ill with salmonella infections after consuming salmonella-
contaminated Peter Pan or Great Value peanut butter.
"We have been contacted by over 2,200 families who consumed
peanut butter and are looking to pursue legal claims against
ConAgra since the [U.S. Food and Drug Administration] announced
the recall of ConAgra-manufactured peanut butter on February
14," said William Marler, managing partner of Seattle-based law
firm, Marler Clark.
"We feel that a class action is the most efficient means for
achieving fair compensation for people who were not
hospitalized, but have strong evidence of a Salmonella
infection."
Mr. Marler pointed out that the class action excludes any
individuals who were hospitalized or died as a result of their
illnesses.
Marler Clark has been contacted by hundreds of people who were
hospitalized as a result of their salmonella infections, and is
investigating three deaths that may be tied to this outbreak.
"Those people suffered more severe injuries than the majority of
people we have been contacted by, and we will pursue individual
claims on their behalf," added Mr. Marler.
The proposed class includes all persons who:
-- purchased Peter Pan or Great Value peanut butter since
May 2006 with a product-code beginning with 2111
imprinted on the lid; and
-- as a result suffered either:
(a) a lab-confirmed salmonella infection, or
(b) symptoms consistent with a salmonella infection --
i.e., fever, abdominal cramps, headache, and
diarrhea -- that otherwise fit the CDC case-
definition for the subject outbreak.
Plaintiffs' counsel is Marler Clark L.L.P., P.S., 6600 Bank of
America Tower, 701 Fifth Avenue, Seattle, WA 98104, Phone: (866)
770 - 2032.
For more information, contact Suzanne Schreck of Marler Clark
LLP, PS, Phone: (206) 346-1879, E-mail:
sschreck@marlerclark.com.
DOLE FRESH: Recalls Cantaloupes Contaminated with Salmonella
------------------------------------------------------------
Dole Fresh Fruit Co. is recalling cantaloupes in the Eastern
U.S. and Quebec due to potential health concerns.
Some cantaloupes packed on Jan. 25, 26 and 27, 2007 by an
independent, third-party grower in Costa Rica have tested
positive for salmonella.
Although no illnesses have been reported, Dole voluntarily has
decided to recall all cantaloupes imported from Costa Rica and
packed by that grower.
Persons infected with salmonella may experience a variety of
symptoms and illnesses. According to the U.S. Food and Drug
Administration, healthy persons infected with Salmonella often
experience fever, diarrhea (which may be bloody), nausea,
vomiting and abdominal pain. In rare circumstances, infection
with Salmonella can result in more severe illnesses and
potentially can be fatal.
Approximately 6,104 cartons of cantaloupes were distributed to
wholesalers in regions of the eastern U.S. and Quebec between
Feb. 5 and Feb. 8, 2007. The cantaloupes have a light green
color skin on the exterior, with orange flesh. The cantaloupes
were distributed for sale in bulk in cardboard cartons, with 9,
12 or 15 cantaloupes to a carton.
The recalled cartons are dark brown with "Dole Cantaloupes" in
red lettering. They have a 13-digit number on a white tag
pasted to the carton; the tenth digit is a 2.
The recall is a result of a random test by the company.
Consumers who have uneaten cantaloupe purchased in the eastern
U.S. or Quebec, on or after Feb. 5, 2007, may contact their
retail store to see if the product is the recalled brand.
Consumers with additional questions should contact the Dole
Consumer Center at (800) 232-8888.
EMERY WORLDWIDE: Still Faces Ohio Suit Alleging WARN Violations
---------------------------------------------------------------
Emery Worldwide Airlines, a subsidiary of CNF, Inc. and the U.S.
Postal Service, remains a defendant in a labor class action
filed in the U.S. District Court for the Southern District of
Ohio.
The suit alleges violations of the Worker Adjustment and
Retraining Notification Act in connection with employee layoffs
and ultimate terminations due to the August 2001 grounding of
Emery Worldwide's airline operations and the shutdown of the
airline operations in December 2001.
The court subsequently certified the lawsuit as a class action
on behalf of affected employees laid off between Aug. 11 and
Aug. 15, 2001.
The WARN Act generally requires employers to give 60-days
notice, or 60-days pay and benefits in lieu of notice, of any
shutdown of operations or mass layoff at a site of employment.
Con-way, Inc. did not report development in the case at its Nov.
8, 2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended Sept. 30, 2006.
The suit is "Bledsoe, et al. v. Emery Worldwide Airlines, et
al., Case No. 3:02-cv-00069-WHR-SLO," filed in the U.S. District
Court for the Southern District of Ohio under Judge Walter H.
Rice.
Representing the plaintiffs is David Gerard Torchia, Tobias &
Kraus - 1 414 Walnut Street Cincinnati, OH 45202 Phone: 513-241-
8137 Fax: 513-241-8137 E-mail: davet@tktlaw.com.
Representing the company are:
(1) Michelle R. Arendt and Thomas H. Barnard, Jr. Ulmer and
Berne Penton Media Building 1300 E. Ninth Street Suite
900 Cleveland, OH 44114 Phone: 216-931-6056 Fax: 216-
931-6057 E-mail: marendt@ulmer.com; and
(2) Jacqueline Schuster Hobbs, Cinergy Services, Inc. 139
East Fourth Street 25ATII Cincinnati, OH 45201-0960
Phone: 513-287-1238 Fax: 513-287-2996 E-mail:
Jacqueline.Hobbs@Cinergy.com.
GILMAN & CIOCIA: June 2007 Hearing Set for Del. Investors Suit
--------------------------------------------------------------
A June 4, 2007 trial is slated for the purported stockholders'
class action against Gilman & Ciocia, Inc., which is pending in
the Court of Chancery of the State of Delaware in and for New
Castle County.
On Feb. 4, 2004, the company was served with a summons and a
shareholder's class action and derivative complaint filed by
Gary Kosseff against James Ciocia, Thomas Povinelli, Michael P.
Ryan, Kathryn Travis, Seth A. Akabas, Louis P. Karol, Edward H.
Cohen, Steven Gilbert and Doreen Biebusch, and Gilman & Ciocia,
Inc. (Civil Action No. 188-N).
The action accuses the company, its board of directors and its
management of breaching their fiduciary duty of loyalty in
connection with the sale of offices to Pinnacle Taxx Advisors,
LLC in 2002.
The action alleges that the sale to Pinnacle was for inadequate
consideration and without a fairness opinion by independent
financial advisors, without independent legal advice and without
a thorough evaluation and vote by an independent committee of
the board of directors.
The action seeks:
-- a declaration that the company, its board of directors
and management breached their fiduciary duty and other
duties to the plaintiff and to the other members of the
purported class;
-- a rescission of the Asset Purchase Agreement;
-- unspecified monetary damages; and
-- an award to the plaintiff of costs and disbursements,
including reasonable legal, expert and accountants
fees.
On March 15, 2004, counsel for the company and for all
defendants filed a motion to dismiss the lawsuit. On June 19,
2004, the plaintiff filed an amended complaint.
On July 12, 2004, counsel for the company and for all defendants
filed a motion to dismiss the amended complaint. On March 8,
2005, oral argument was heard on the motion to dismiss, and on
July 27, 2005 the case master delivered his draft report denying
the motion.
The parties filed exceptions to the report and on Aug. 3, 2006,
the master delivered his final report denying the motion to
dismiss.
The parties are proceeding with discovery and the case is
scheduled for trial on June 4, 2007, according to the company's
Feb. 14 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended Dec. 31, 2006.
HOSPIRA INC: Continues to Face ERISA Violations Lawsuit in Ill.
---------------------------------------------------------------
Hospira, Inc. remains a defendant in a purported class action
alleging that the spin-off of the company from Abbott
Laboratories adversely affected employee benefits in violation
of the Employee Retirement Security Act of 1974.
The lawsuit was filed on Nov. 8, 2004 in the U.S. District Court
for the Northern District of Illinois, and is captioned: "Myla
Nauman, Jane Roller and Michael Loughery v. Abbott Laboratories
and Hospira, Inc."
On Nov. 18, 2005, the complaint was amended to assert an
additional claim against Abbott and the company for breach of
fiduciary duty under ERISA. The company has moved to dismiss
the new claim.
By Order dated Dec. 30, 2005, the court granted class action
status to the lawsuit. The new claim in the amended complaint
is not subject to the class certification ruling.
As to the sole claim against the company in the original
complaint, the court certified a class defined as:
"all employees of Abbott who were participants in the
Abbott Benefit Plans and whose employment with Abbott was
terminated between Aug. 22, 2003 and April 30, 2004, as a
result of the spin-off of the HPD/creation of Hospira
announced by Abbott on Aug. 22, 2003, and who were
eligible for retirement under the Abbott Benefit Plans on
the date of their terminations."
The company did not report development in the case at its Nov.
8, 2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended Sept. 30, 2006.
The suit is "Myla Nauman, Jane Roller and Michael Loughery v.
Abbott Laboratories and Hospira, Inc., Case No. 1:04-cv-07199,"
filed in the U.S. District Court for the Northern District of
Illinois under Judge Robert W. Gettleman.
Representing the plaintiffs is Paul William Mollica of Meites,
Mulder, Burger & Mollica, 208 South LaSalle Street, Suite 1410,
Chicago, IL 60604, Phone: (312) 263-0272.
Representing the Company is James F. Hurst, Winston & Strawn
LLP, 35 West Wacker Drive, 41st Floor, Chicago, IL 60601, Phone:
(312) 558-5230 or E-mail: jhurst@winston.com.
The suit is "Nauman, et al. v. Abbott Labs, et al.," filed in
the U.S. District Court for the Northern District of Illinois
under Judge Robert W. Gettleman with referral to Judge Geraldine
Soat Brown.
Representing the plaintiffs is Paul William Mollica of Meites,
Mulder, Burger & Mollica, 208 South LaSalle St., Suite 1410,
Chicago, IL 60604, Phone: (312) 263-0272, E-mail:
pwmollica@mmbmlaw.com.
Representing the defendants are:
(1) William Denby Heinz of Jenner & Block, LLC, One IBM
Plaza, 330 North Wabash Ave., 40th Floor, Chicago, IL
60611, Phone: (312) 222-9350, E-mail:
wheinz@jenner.com; and
(2) James F. Hurst of Winston & Strawn, 35 West Wacker
Drive, 41st Floor, Chicago, IL 60601, Phone: (312)
558-5600, E-mail: jhurst@winston.com.
JJB SPORTS: To Face Lawsuit for Fixing Prices of Football Shirts
----------------------------------------------------------------
Consumer organization Which? is planning to sue JJB Sports on
behalf of people who bought replica England and Manchester
United football shirts between 2000 and 2001, according to The
Lawyer.
Which? is planning to bring the case before the Competition
Appeals Tribunal. It is the only U.K. organization that has the
power to bring claims on behalf of wronged consumers under the
Enterprise Act of 2002, the report said.
JJB Sports was found to have conspired with Umbro, AllSports in
fixing prices for football shirts.
Which? has already approached Clyde & Co. regarding the suit.
Senior competition associate Mark Warrington is leading the
team, the report said.
Which? hopes to win GBP20 for every consumer who bought one of
the replica shirts.
KRISPY KREME: Court Grants Final Approval for $75M Settlement
-------------------------------------------------------------
The U.S. District Court for the Middle District of North
Carolina granted final approval for the $75 million settlement
of a consolidated securities fraud class action filed against
Krispy Kreme Doughnuts, Inc.
The suit was filed May 12, 2004 on behalf of persons who
purchased the company's publicly traded securities between Aug.
21, 2003 and May 7, 2004 against the company and certain of its
current and former officers.
Plaintiff alleged that defendants violated Sections 10(b) and
20(a) of the U.S. Exchange Act and Rule 10b-5 promulgated
thereunder in connection with various public statements made by
the company. They sought damages in an unspecified amount.
Thereafter, 14 substantially identical purported class actions
were filed in the same court. On Nov. 8, 2004, all of these
cases were consolidated into one action.
The court appointed lead plaintiffs in the consolidated action,
who filed a second amended complaint on May 23, 2005, alleging
claims under Sections 10(b) and 20(a) of the Exchange Act on
behalf of persons who purchased the company's publicly-traded
securities between March 8, 2001 and April 18, 2005. The
company filed a motion to dismiss the second amended complaint
on Oct. 14, 2005 that is currently pending.
On Oct. 31, 2006, the company and the Special Committee entered
into a Stipulation and Settlement Agreement with the lead
plaintiffs in the securities class action, all defendants named
in the class action, except for Scott Livengood, the company's
former chairman and chief executive officer, providing for the
settlement of the securities class action.
The stipulation provides for the certification of a class
consisting of all persons who purchased Krispy Kreme's publicly
traded securities between March 8, 2001 and April 18, 2005,
inclusive.
The settlement class will receive total consideration of
approximately $75 million, consisting of:
-- a cash payment of $34,967,000 to be made by the
company's directors' and officers' insurers;
-- a cash payment of $100,000 to be made by Mr. John Tate,
former chief operating officer;
-- a cash payment of $100,000 to be made by Mr. Randy
Casstevens, former chief financial officer;
-- a cash payment of $4,000,000 to be made by the company's
independent registered public accounting firm and common
stock and warrants to purchase common stock to be issued
by the company having an aggregate value of $35,833,000
(based on the market price of the company's common stock
as of late October and early November 2006).
Claims against all defendants will be dismissed with prejudice;
however, claims that the company may have against Mr. Livengood
that may be asserted by the company in the derivative action for
contribution to the securities class action settlement or
otherwise under applicable law are expressly preserved.
The stipulation contains no admission of fault or wrongdoing by
the company or the other defendants. On Nov. 16, 2006, the
court entered an order granting preliminary approval to the
settlement.
On Feb. 15, 2007, the U.S. District Court for the Middle
District of North Carolina granted final approval of the roposed
settlement in the consolidated securities class action, "In re
Krispy Kreme Doughnuts, Inc. Securities Litigation, Case No.
1:04-CV-00416," and entered final judgment dismissing all claims
with respect to all defendants, the company said in a Feb. 16,
2007 Form 8-K filing with the U.S. Securities and Exchange
Commission.
The suit is "In re Krispy Kreme Doughnuts, Inc. Securities
Litigation, Case No. 1:04-CV-00416," filed in the U.S. District
Court for the Middle District of North Carolina under Judge
William L. Osteen.
Representing the plaintiffs are:
(1) Richard B. Brualdi of The Brualdi Law Firm, 29
Broadway, Ste. 2400, New York, NY 10006, US, Phone:
212-952-0602, Fax: 212-952-0608, E-mail:
rbrualdi@brualdilawfirm.com;
(2) John Thurston O'Neal of O'Neal Law Office, 7
Battleground Court, Suite 212, Greensboro, NC 27408,
Phone: 336-510-7904, Fax: 336-510-7965, E-mail:
oneallaw@triadbiz.rr.com; and
(3) Leslie Bruce McDaniel of McDaniel & Anderson, L.L.P.,
P.O.B. 58186, Raleigh, NC 27658-8186, Phone: 919-872-
3000, Fax: 919-790-9273, E-mail: mcdas@mcdas.com.
Representing the defendants are:
(i) William Mark Conger of Kilpatrick Stockton, L.L.P.,
1001 W. Fourth St., Winston-Salem, NC 27101, Phone:
336-607-7309 and 336-607-7351, Fax: 336-734-2633 and
336-734-2625, E-mail: mconger@kilpatrickstockton.com
and jkelly@kilpatrickstockton.com; and
(ii) Nicholas I. Porritt of Wilson Sonsini Goodrich &
Rosati, P.C., Two Fountain Sq., Reston Town Ctr., 11921
Freedom Dr., Ste. 600, Reston, VA 20190-5634, Phone:
703-734-3107, Fax: 703-734-3199, E-mail:
nporritt@wsgr.com.
LEGENDS RESORT: Timeshare Owners Prepare Suit After Trading Halt
----------------------------------------------------------------
About 30 timeshare owners at Legends Resort & Country Club in
northern New Jersey are preparing a class action against the
McAfee hotel and country club for alleged fraud, The New Jersey
Herald reports.
The timeshare owners said the former Playboy Club has fallen
into disrepair over the years. They claim that when they
purchased timeshares more than six years ago they had been
promised a boost in their trading power rating once repairs are
made to the hotel.
A timeshare purchase gives the owner one week in one of the 23
available rooms on the hotel's sixth floor, which they can trade
for a week-long vacation at other hotels and resorts around the
world, according to the report.
The Resort Condominiums International vacation exchange company
has suspended the resort from its exchange program in December,
reportedly because of "ongoing concerns regarded by members."
Ben Harris, an attorney representing Metairie Corp., the
developer that owns Legends, said they were working to restore
and maintain the hotel, and had been for the last six years,
according to the report.
The timeshare holder group's attorney is Ryan Mulvaney at
McElroy, Deutsch, Mulvaney & Carpenter, LLP, 1300 Mount Kemble
Avenue, P.O. Box 2075, Morristown, New Jersey 07962-2075 (Morris
Co.).
MORTGAGE LENDERS: Anticipate a Wave of Suits Over Loan Terms
------------------------------------------------------------
Class action lawyers are preparing to go after mortgage lenders
in a wave of class actions by borrowers claiming they were
deceived about loan terms, the The Kiplinger Letter reports.
Most suits will focus on subprime borrowers, mostly low-incomers
or people with shaky finances who pay higher interest rates on
loans.
These lenders allegedly concealed how high and fast interest
rates could rise on some adjustable rate mortgages, leaving
borrowers in shock later on.
The main targets will be the biggest lenders to tap for damages.
NTL INC: Court Rejects "Gordon" Motion for Attorneys' Fees Share
----------------------------------------------------------------
U.S. Magistrate Judge Andrew Peck denied the "Gordon plaintiffs"
request for a share of the attorneys' fees to be awarded to
counsel for the class plaintiffs in connection with the proposed
$9,000,000 settlement in the matter, "In Re NTL, Inc. Securities
Litigation, Case No. 02-CV-3013 (LAK)(AJP)," the New York Law
Journal reports.
Several suits were initially filed, generally alleging that the
defendants failed to disclose NTL Europe's financial condition,
finances and future prospects accurately in press releases and
other communications with investors prior to filing its Chapter
11 case in federal court.
The defendants filed motions to dismiss the actions and, on July
31, 2003, the court entered an order dismissing the complaint in
the individual action without prejudice to filing an amended
complaint and deferred its decision on the complaint in the
class actions. On Aug. 20, 2003, the plaintiff in the
individual action filed an amended complaint. The company then
asked the court to dismiss the suit.
On Dec. 7, 2004, the court denied in part and granted in part
the defendants' motions to dismiss all actions. The court
denied the defendants' motions to dismiss claims based on
factual allegations that NTL Europe failed to disclose material
difficulties it faced in integrating acquired companies, failed
to disclose material practices that inflated subscriber numbers
(with respect to some defendants), and failed to disclose the
cash flow status of its largest acquisition during the relevant
period (with respect to some defendants). The court found no
factual support for the plaintiffs' other allegations.
In 2005, the U.S. District Court for the Southern District of
New York granted in part the company's motion to dismiss the
consolidated securities class action filed against NTL Europe,
Inc. and some of its former officers (Class Action Reporter,
Sept. 21, 2005).
In 2006, NTL Inc. proposed a $9,000,000 settlement in the
matter, "In Re NTL, Inc. Securities Litigation, Case No. 02-CV-
3013 (LAK)(AJP)" (Class Action reporter, Oct. 13, 2006).
The case covers all persons or entities that purchased or
otherwise acquired the publicly traded securities of NTL, Inc.
on the open market during the period between Aug. 10, 2000 and
Nov. 29, 2001.
During the class period, NTL was a New York based corporation
providing telephone, cable television, Internet, and broadband
communications services in the United Kingdom, Ireland, and
parts of continental Europe.
While NTL Europe, Inc. has been released from monetary liability
(other than PTV's insurance coverage) in these actions as a
result of the completion of the company's Reorganization Plan,
the case remained pending against PTV and the individuals named
as defendants.
Plaintiffs then moved for discovery sanctions against NTL Europe
and "nominal non-party NTL Inc.," claiming they "hindered and
delayed document discovery and allowed numerous documents and
electronically stored information, including the emails of
approximately forty-four of NTL's 'key players,' to be
destroyed."
The Gordon plaintiffs requested that the court impose a range of
sanctions, including an adverse inference order for fact finding
purposes during summary judgment or trial, and payment of
attorneys' fees and costs relating to this motion and the
document discovery process.
On Jan. 29, the court heard oral arguments on the motion and
granted the motion in substantial part and awards an adverse
inference spoliation sanction, plus attorneys' fees in an amount
to be determined (Class Action Reporter, Feb. 6, 2007).
Magistrate Judge Andrew J. Peck denied the motion of counsel for
the Gordon plaintiffs -- who are not part of the class action --
for a share of the attorneys' fees to be awarded to counsel for
the class plaintiffs in connection with the $9 million
settlement of the class action.
Class counsel's separate motion for attorneys' fees of 20
percent of the settlement amount is separately pending before
the Court and will be decided in a separate decision.
The suit is "In Re: NTL, Inc. Securities Litigation, Case No.
1:02-cv-03013-LAK-AJP," filed in the U.S. District Court for the
Southern District of New York.
Representing the company is Seth Marc Schwartz, Skaddden, Arps,
Slate, Meagher & Flom LLP (NYC), Four Times Square, New York, NY
10036, Phone: 212-735-3000, Fax: 917-777-2710, Email:
sschwart@skadden.com.
Representing the plaintiffs are:
(1) Cary L. Talbot, Daniel Bernard Scotti, Steven G.
Schulman, Milberg Weiss Bershad & Schulman LLP (NYC),
One Pennsylvania Plaza, New York, NY 10119, Phone:
(212) 594-5300, Fax: (212) 868-1229, Email:
dscotti@milberg.com and sschulman@milbergweiss.com
(2) David Arthur Scott, Michael A. Swick, Scott & Scott,
L.L.C., P.O. Box 192, 108 Norwich Avenue, Colchester,
CT 06415, Phone: (860) 537-5537
(3) Nadeem Faruqi, Farrell & Thurman, PC, P.O. Box 671,
Princeton, NJ 08542, Phone: (212)983-9330, Fax: (212)
983-9331, Email: nfaruqi@faruqilaw.com;
(4) Samuel Howard Rudman, Lerach, Coughlin, Stoia, Geller,
Rudman & Robbins, LLP, 200 Broadhollow Road, Ste. 406,
Melville, NY 11747, Phone: 631-367-7100, Fax: 631-367-
1173, Email: srudman@lerachlaw.com.
OFFICE DEPOT: Reaches $16M Settlement in "Birch" Litigation
-----------------------------------------------------------
Office Depot Inc. agreed in principle to settle for $16 million
the purported class action, "Birch et al. v. Office Depot,
Inc.," which was filed in the U.S. District Court for the
Southern District of California.
The case was brought as a class action by certain current and
former employees of the company, alleging that they and other
current and former employees were not properly compensated for
meal breaks and rest breaks in accordance with California law.
Named as plaintiffs in the case are:
-- Eric Birch,
-- Fabian Alcala, and
-- Laura Muller.
Without admitting any liability, during 2007, the company agreed
in principle to settle this matter in full for a total payment
of approximately $16 million.
The parties are working to secure court approval of the
settlement, according to the company's Feb. 14 Form 10-K filing
with the U.S. Securities and Exchange Commission for the fiscal
year ended Dec. 30, 3006.
The suit is "Birch v. Office Depot Inc., et al., Case No. 3:06-
cv-01690-DMS-WMC," filed in the U.S. District Court for the
Southern District of California under Judge Dana M. Sabraw with
referral to Judge William McCurine, Jr.
Representing the plaintiffs is Christopher John Nelson of Grace
Hollis Lowe Hanson and Schaeffer, 3555 Fifth Avenue, San Diego,
CA 92103, Phone: (619) 692-0800, Fax: (619) 692-0822, E-mail:
cnelson@gracehollis.com.
Representing the defendant is Robin J. Samuel of Hogan &
Hartson, 1999 Avenue of the Stars, Suite 1400, Los Angeles, CA
90063, Phone: (310) 785-4765, Fax: (310) 785-4701, E-mail:
rjsamuel@hhlaw.com.
OHIO: Sixth Circuit Allows Suit Over Cadaver Photos to Proceed
--------------------------------------------------------------
The U.S. Court of Appeals for the Sixth Circuit allowed a class
action to continue against employees at Hamilton County Morgue
and a photographer, who took hundreds of pictures of cadavers
posed with props without the families' consent.
Case Background
In 2001, Jaqueline Chesher and other named plaintiffs initiated
a class action against Hamilton County, several individuals
employed at the Hamilton County Morgue, and Thomas Condon, a
private photographer. The suit was filed in the U.S. District
Court for the Southern District of Ohio.
The substance of Ms. Chesher's claims arises from the heavily
publicized discovery in January 2001 of at least 317 allegedly
improper photographs of dead bodies taken at the Hamilton County
Morgue without the knowledge or consent of the decedents'
relatives.
Taken between August 2000 and mid-January 2001, the photographs
depict the bodies in unnatural "artistic" poses, often employing
props for effect.
According to court documents, the employee defendants allegedly
engaged in a civil conspiracy and inflicted emotional distress
on the class members by facilitating the project and later
covering up their involvement.
Generally, the suit accused county officials of not doing enough
to prevent Mr. Condon's pictures and causing them emotional
distress when they learned the bodies of their loved ones had
been photographed.
In March of 2002, Ms. Chesher filed an amended complaint, naming
as defendants Hamilton County, Mr. Condon, and employee
defendants:
-- Terry Daly,
-- Rhonda Gros,
-- Carl Parrott,
-- Robert Pfalzgraf,
-- Jonathan Tobias, and
-- Gary Utz.
The amended complaint asserted federal claims under 42 U.S.C.
Section 1983 and state-law claims for negligent and intentional
infliction of emotional distress, as well as for a civil
conspiracy to inflict such harm.
In May 2003, the district court issued an order that
conditionally certified the class under Rule 23(a) of the
Federal Rules of Civil Procedure.
Subsequently, in response to a motion by the defendants to
decertify the class, the court split the class into two
subclasses.
Subclass One consists of the family members of all the deceased
whose remains, for other than a proper government purpose, were
photographed by Messrs. Condon or Tobias or one of their agents
between August 2000 and January 2001 (inclusive) while such
bodies were in custody of the Hamilton County Coroner's office,
without permission from the legal representatives of the
deceased.
Subclass Two consists of a corresponding group of family members
of the deceased whose remains were not photographed, but were
instead only "accessed, viewed or manipulated" by Messrs. Condon
or Tobias.
In December of 2004, the district court granted the county's
motion to dismiss Ms. Chesher's claims for intentional
infliction of emotion distress and for civil conspiracy,
concluding that the county was immune from liability for the
intentional tort claims.
However, the court held that the claim against the county for
negligent infliction of emotional distress remained viable under
an exception to the county's statutory immunity. That order has
not been appealed.
In September 2005, the district court denied in part the various
defendants' motions for summary judgment. Those motions were
based in part on state-law immunity grounds, but the court found
that the employee defendants were not entitled to immunity under
Ohio law.
The court did dismiss all of the claims against Ms. Gros based
on the lack of evidence supporting her involvement. In
addition, it reminded the county that the state-law intentional
tort claims against it had already been dismissed.
The county did not move for summary judgment based on state-law
immunity regarding the negligence claim still pending against
it.
The remaining employee defendants, timely filed the present
interlocutory appeal from the district court's denial of their
motions for summary judgment.
Hamilton County joined the appeal, contending that the district
court's September 2005 order improperly denied the county
summary judgment based on statutory immunity regarding Ms.
Chesher's state-law negligence claims, despite the fact that the
county never moved for summary judgment on that ground.
The federal Section 1983 claims have been dismissed with respect
to all of the defendants except the county, and that claim is
not at issue in the appeal.
On Feb. 16, the 6th Circuit affirmed the district court's denial
of most of the defendants' motions for summary judgment, in
which they sought statutory immunity under Ohio law.
In essence, the appeals court affirmed the judgment of the
district court and remanded the case for further proceedings
consistent with the opinion it issued.
A copy of the Sixth Circuit's opinion is available free of
charge at: http://researcharchives.com/t/s?1a2a.
The suit is "Chesher, et al. v. Neyer, et al., Case No. 1:01-cv-
00566-SAS-TSH," on appeal from the U.S. District Court for the
Southern District of Ohio under Judge S. Arthur Spiegel with
referral to Judge Timothy S. Hogan.
Representing the plaintiffs are:
(1) Alphonse Adam Gerhardstein of Gerhardstein Branch &
Laufman Co. LPA, 617 Vine Street # 1409, Cincinnati, OH
45202, Phone: 513-621-9100, E-mail:
agerhardstein@GBfirm.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.
Representing the defendants are:
(i) Louis Francis Gilligan of Keating Muething & Klekamp -
1, One E Fourth Street, Suite 1400, Cincinnati, OH
45202, Phone: 513-579-6400, Fax: 513-579-6523, E-mail:
lgilligan@kmklaw.com; and
(ii) Stephen James Patsfall of Patsfall Yeager & Pflum LLC -
1, One W Fourth Street, Suite 1800, Cincinnati, OH
45202, Phone: 513-721-4500, E-mail:
spatsfall@pyplaw.com.
PAPA JOHN'S: Calif. Court Grants Class Status to Employees' Suit
----------------------------------------------------------------
The U.S. District Court for the Central District of California
recently granted class action certification to a wage and hour
suit involving more than 900 possible plaintiffs who worked at
Papa John's Pizza.
Brought by the Los Angeles offices of Shawn Khorrami and
Kabateck Brown Kellner, LLP in 2005, the suit charges that PJ
United and its subsidiary PJ Cheese, the holding company for 14
Papa John's Pizza restaurants throughout Los Angeles County,
misclassified workers as "store managers" as a matter of policy,
to circumvent California employment laws.
The suit also alleges that the pizza chain denied meal and rest
periods to its drivers as well as other in-store employees,
violating California wage and hour statutes.
Under California law, an "exempt" manager status must meet
certain requirements, among them, they must regularly and
customarily exercise independent judgment in decision-making and
most of their time must be spent engaged in managerial type
work.
The suit contends that PJ Cheese did not meet these criteria
with its "managers" and, in fact, gave workers the title as a
ploy to avoid providing meal breaks, rest periods and overtime
pay.
The U.S. Circuit court found that this policy, and other
violations, were widespread and standardized, thereby awarding
the suit class action status.
"Most of these people live paycheck to paycheck -- each dollar
of pay was vital to their families. This ruling is a major step
in bringing justice to them," says Shawn Khorrami from the Law
Offices of Shawn Khorrami and the lead lawyer in the case.
The class-action status of this suit increases the risk of a
large judgment against PJ United and PJ Cheese and may increase
the amount of settlement for the plaintiffs.
"Non-exempt workers were forced to work through lunch hours and
forego breaks," says Brian S. Kabateck, partner in Kabateck
Brown Kellner and one of the attorneys representing the class.
"California laws are designed to protect the hard working men
and women of this state.
These laws prohibit businesses from lining their pockets by
withholding wages due their workers and making employees work
unreasonable hours."
The suit is "John Alba et al. v. Papa John's USA Inc. et al.,
Case No. 2:05-cv-07487-GAF-CT," filed in the U.S. District Court
for the Central District of California under Judge Gary A.
Feess, with referral to Judge Carolyn Turchin.
Representing plaintiffs are:
(1) Brian S. Kabateck and Richard L. Kellner, both of
Kabateck Brown Kellner, 350 S Grand Ave, 39th Floor,
Los Angeles, CA 90071, Phone: 213-217-5000, E-mail:
bsk@kbklawyers.com; and
(2) Shawn Khorrami and Patricia L. Mitchell, both of Shawn
Khorrami Law Offices, 14550 Haynes St., 3rd Fl., Van
Nuys, CA 91411, Phone: 818-947-5111, E-mail:
skhorrami@khorrami.com.
Representing defendants are Anthony S. Brill, Lawrence J.
Gartner and Stefanie M. Gusha, all of Baker & Hostetler, 333 S
Grand Ave, Ste 1800, Los Angeles, CA 90071-1523, Phone: 213-975-
1600, E-mail: abrill@bakerlaw.com.
REFCO INC: Plan Administrators File Omnibus Objection to Claims
---------------------------------------------------------------
RJM, LLC, as Plan Administrator of the Chapter 11 cases of the
Reorganized Refco Inc. and its debtor-affiliates, and Marc S.
Kirschner, as Plan Administrator of Refco Capital Markets,
Ltd.'s case, have identified certain proofs of claim in the
Debtors' books and records that assert both:
(i) a secured claim representing amounts related to foreign
exchange trading accounts with Refco F/X Associates, LLC;
and
(ii) an unsecured non-priority claim of not less than a pro
rata share of $102,000,000 relating to a class action
filed after the Petition Date, styled American Financial
International Group - Asia, LLC, et al. v. Phillip R.
Bennett, et al., Case No. 05 Civ. 8988 (GEL), pending in
the U.S. District Court for the Southern District of New
York.
The Plan Administrators ask the U.S. Bankruptcy Court for the
Southern District of New York to reclassify the Account Claim
portion of each FXA Class Action Client Disputed Claims as
unsecured non-priority claims.
The Plan Administrators do not dispute that each Account
Claimant is entitled to assert a claim in an amount equal to the
claimant's foreign exchange trading account balance, if any,
under the terms of its client agreement with FXA.
Although they have not yet reviewed each Account Claim to
reconcile those claims with their books and records, the Plan
Administrators are not disputing the prima facie amount of each
Account Claim.
However, the Plan Administrators assert that the Account Claims
are not properly categorized as secured. The Client Agreements
establish the rights between the parties and established a
debtor-creditor relationship between FXA and the claimants.
Mark W. Deveno, Esq., at Bingham McCutchen LLP, in New York,
tells Judge Drain that despite the Account Claimants' assertion
of secured status for their claims, clients that trade in
foreign currencies are not entitled by statute or otherwise to a
priority in the bankruptcy of an unregulated foreign exchange
dealer like FXA.
Mr. Deveno adds that none of the Claims are secured by a lien on
any property in which FXA, or any other debtor entity, has an
interest, or are subject to setoff under Section 553 of the
Bankruptcy Code.
Furthermore, the Plan Administrators want the Class Claim
portion of each FXA Class Action Client Disputed Claims
disallowed and expunged because FXA is not a defendant in the
Class Action.
Mr. Deveno points out that filing of the Class Action after the
Petition Date violated the automatic stay of Section 362 and,
thus was void ab initio. After admonition from the Bankruptcy
Court, the putative class action plaintiffs dismissed their
claims against FXA and the other debtor entities, he notes.
Moreover, pursuant to the Reorganized Debtors' Chapter 11 Plan,
general unsecured creditors of FXA are entitled to receive a pro
rata portion of the proceeds of the sale of the FXA customer
list.
To prevent disclosure of confidential and proprietary
information regarding the identity of the FXA customers, the
Plan Administrators separately seek the Bankruptcy Court's
authority to file the complete list of the FXA Class Action
Client Disputed Claims and any subsequent amendments under seal
pursuant to Section 107(b).
The Plan Administrators want the documents available only to
their counsel, the Bankruptcy Court, the Plan committee, and the
U.S. Trustee and her counsel.
Mr. Deveno states that publicly disclosing the information on
the list of the Claims will compromise the sale of the FXA
customer list and decrease its market value, hence, prejudicing
the FXA creditors' interests and impede the Plan's
implementation.
(Refco Bankruptcy News, Issue No. 57; Bankruptcy Creditors'
Service, Inc.: http://bankrupt.com/newsstand/or 215-945-7000)
RETAIL VENTURES: Faces Lawsuits Over Credit Card, Data Thefts
-------------------------------------------------------------
Retail Ventures, Inc. is a defendant in two class actions
arising from theft of credit card and other purchase
information, the company said at its Dec. 6, 2006 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarterly period ended Oct. 28, 2006.
On March 8, 2005, Retail Ventures announced that it had learned
of the theft of credit card and other purchase information from
a portion of DSW, Inc.'s customers.
On April 18, 2005, Retail Ventures issued the findings from its
investigation into the theft. The theft covered transaction
information involving approximately 1.4 million credit cards and
data from transactions involving approximately 96,000 checks.
DSW and Retail Ventures contacted and continue to cooperate with
law enforcement and other authorities with regard to this
matter.
The company is involved in several legal proceedings arising out
of this incident, including two putative class actions, which
seek unspecified monetary damages, credit monitoring and other
relief.
Each of the two lawsuits seeks to certify a different class of
consumers.
One of the lawsuits seeks to certify a nationwide class that
would include every consumer who used a credit card, debit card,
or check to make purchases at DSW between November 2004 and
March 2005 and whose transaction data was taken during the data
theft incident.
The other lawsuit seeks to certify classes of consumers that are
limited geographically to consumers who made purchases at
certain stores in Ohio.
Retail Ventures on the Net: http://www.retailventuresinc.com.
SMILECARE: Dental Hygienist Complains of Unpaid Overtime Work
-------------------------------------------------------------
Dental hygienist Tami Ware filed a class action against
SmileCare claiming she was cheated out of rest breaks and
overtime pay, The Record reports.
Ms. Ware, a resident of Discovery Bay, California, claims
SmileCare overscheduled patients, forcing her to work nonstop
for more than eight hours a day. She has worked for one month
in the Stockton office of the dental chain.
This "assembly-line mentality" violates state law and results in
poor treatment for patients, said Los Angeles attorney Shawn
Khorrami, who filed the suit for Ms. Ware.
SmileCare vice president of legal affairs, Jeffrey Katz, called
Ms. Ware's claims in the lawsuit bogus and said she never lodged
a complaint about being overworked.
Mr. Katz said none of the company's other employees has filed a
claim like Ms. Ware's, nor had SmileCare received a call from
the Los Angeles attorneys who filed the suit to check the
validity of her story.
He added SmileCare follows labor laws, protecting the rights of
its employees and patients.
Mr. Khorrami believes that up to 1,000 other employees of Smile-
Care could feel that their rights were violated, too, and will
join her suit filed in the Los Angeles County Superior Court.
TENNESSEE: Judge Haynes Sides with Senior Services Patients
-----------------------------------------------------------
U.S. District Judge William J. Haynes Jr. has issued a ruling
preventing the state of Tennessee from cutting off services to
500 patients of Memphis-based home health care firm Senior
Services.
Senior Services offers a range of services to elderly and
disabled people, including a program supported by TennCare, the
state administrator of the federal Medicaid program for the poor
and disabled.
The firm's case managers work with outside companies and arrange
for patients to receive services such as meals and home health
aides. But Senior Services also offers some of the services
itself.
Senior Services said last year that it would choose case
management services and lay off 140 workers in its direct
services divisions after being forced to choose between offering
direct services or case management services. As a result, low-
income patients were to receive care through another state
program.
When a group of patients sued in October, the transition to the
other program was put on hold until the court devises a method
to transfer the patients' care from one state program to
another.
In recent developments, the court said the state should continue
services to patients. It also ordered the state to restore any
benefits that it has discontinued.
The court has certified the case as a class action. Senior
Services is not directly involved in the lawsuit.
Representing the patients is Don Donati at Donati Law Firm, LLP,
1545 Union Avenue, Memphis, Tennessee 38104-3726 (Shelby Co.),
Phone: 901-278-1004, Fax: 901-278-3111.
TOBACCO LITIGATION: Appeals Court Cuts $590M Award in "Scott"
-------------------------------------------------------------
The Louisiana 4th Circuit Court of Appeal affirmed in part and
reversed in part a 2004 jury verdict rejecting medical
monitoring claims but allowing smoking cessation assistance in
the suit "Scott v. American Tobacco Co."
The case is a statewide class action certified in Louisiana
state court. The plaintiffs asked that the defendants pay
billions of dollars to fund a 25-year medical monitoring
program. The jury returned a verdict in the first phase of the
trial in 2003 rejecting medical monitoring claims but allowing
smoking cessation assistance. In May 2004, the jury found that
the duration of the smoking cessation program should be 10
years, and awarded approximately $590 million for the program.
In February 2007, the Louisiana Court of Appeal upheld the class
wide cessation program only for a certain of those who began
smoking before 1988 but rejected the award of approximately $440
million in prejudgment interest.
The court also remanded the case to the trial court with
instructions to further reduce the $590 million jury award for
the program by more than $312 million.
The suit was originally brought by smokers in the state against
cigarette manufacturers, including R.J. Reynolds, Altria Group
Inc.'s Philip Morris USA, British American Tobacco Plc's Brown &
Williamson, and Loews Corp.'s Lorillard, whose tracking stock is
Carolina Group.
According to a report by Reuters, the suit differed from many
other tobacco cases because the plaintiffs did not claim harm
from smoking, but instead said the defendants caused their
addiction to tobacco, and that cessation programs would help
them quit.
The suit is "Gloria Scott, et al. v. American Tobacco Co., Inc.,
et al., Case No. 96-8461."
The lawsuit was brought on behalf of Louisiana residents who
took up smoking as of May 1996. The original class definition
in "Scott" is:
"all Louisiana residents who are or who were smokers on or
before May 24, 1996, of cigarettes manufactured by the
defendants, who desire to participate in a program
designed to assist them in the cessation of smoking and/or
to monitor the medical condition of class members to
ascertain whether they may be suffering from diseases
caused by, contributed to, or exacerbated by the habit of
cigarette smoking, provided the class member alleges that
he or she commenced smoking before Sept. 1, 1988 or
that one or more defendants actively and intentionally
engaged in a course of conduct designed to undermine or
eliminate compliance with or attention to warnings on
cigarette packaging."
It was originally filed by:
(1) Wendell H. Gauthier at Gauthier & Murphy 3500 N. Hullen
St. Metairie, Louisiana 70002, Phone: (50) 456-8600;
(2) Setphen B. Murray at Murray Law Firm 909 Poydras St.,
Suite 2550 New Orleans Louisiana 70112, Phone: (504)
525-8100;
(3) Walter J. Leger, Jr. at Leger & Mestayer, 600
Carondelet St., 9th Floor New Orleans, Louisiana 70130,
Phone: (504) 588-9043; and
(4) Robert L. Redfearn at Simon, Peragine, 30th Floor,
Energy Center, 1100 Poydras St. New Orleans, Louisiana
70163, Phone: (504) 569-2030.
TYSON FOODS: Summary Judgment Motion Rejected in Kan. Labor Suit
----------------------------------------------------------------
U.S. District Judge John W. Lungstrum in Kansas City, Kansas
rejected Tyson Foods Inc.'s motion for summary judgment in a
suit filed by workers asking compensation for time spent putting
on and removing safety gear for work, Associated Press reports.
On May 15, 2006, a lawsuit, "Adelina Garcia, et al. v. Tyson
Foods, Inc. and Tyson Fresh Meats, Inc.," was filed in the U.S.
District Court for the District of Kansas. About 262 current
and former hourly employees of Tyson Food's beef slaughter
facility in Holcomb (Finney County), Kansas filed the suit
seeking class-action status (Class Action Reporter, May 18,
2006).
Plaintiffs filed suit on behalf of themselves and other
allegedly similarly situated employees, claiming defendants
failed to pay employees for all hours worked, including overtime
compensation in violation of the Fair Labor Standard Act and
Kansas law.
Three plaintiffs also have asserted claims under state law for
breach of contract, quantum meruit and violation of the Kansas
Wage Payment Act, K.S.A. Section 44-312.
They seek to act as class representatives for a class action
under Federal Rule of Civil Procedure 23 on behalf of all
current and former hourly employees who worked at the plant in
the preceding five years who were allegedly not paid for all
time worked.
In particular, the suit alleges employees should be paid for the
time it takes to change into protective work uniforms and safety
equipment worn by employees, and walking to and from the
changing area, work areas and break areas.
Plaintiffs are seeking back wages, liquidated damages, pre- and
post-judgment interest, attorneys' fees and costs.
Approximately 700 persons have filed consents to join the case
(Class Action Reporter, Dec. 18, 2006).
Tyson is now paying workers for times spent on changing to and
from special protective clothing, but the current lawsuit would
also covers employees who are required to wear items such as
hair nets, hard hats, gloves and earplugs, according to the
report.
The company filed a motion for partial summary judgment under
the FLSA based on the holdings of "Reich v. IBP, inc., No. 88-
2171-EEO, 1996 WL 445072 (D. Kan. July 30, 1996)," aff'd,
"Metzler v. IBP, inc., 127 F.3d 959 (10th Cir. 1997)" and
related proceedings, where the compensability of donning and
doffing certain clothing and protective gear worn by these
company employees was fully litigated.
In the recent ruling, the court wrote that if the court in that
case were to revisit the issue, it would analyze it differently
considering subsequent cases, particularly one involving IPB,
titled IBP Inc. v. Alvarez in 2005, according to the report.
For more information, contact George A. Hanson or Eric L. Dirks
of Stueve Siegel Hanson Woody LLP, 330 West 47th Street, Suite
250, Kansas City, Missouri, 64112, Phone: (800) 714-0360 or
(816) 714-7100, Fax: (816) 714-7101, E-mail: hanson@sshwlaw.com,
On the Net: http://www.sshwlaw.com.
UNITED STATES: Veterans Affairs Faces Ala. Suit Over Data Theft
---------------------------------------------------------------
The U.S. Department of Veterans Affairs faces a class action in
the U.S. District Court for the Northern District of Alabama
after admitting that it lost a computer hard drive containing
confidential medical information of about 535,000 patients, the
CourtHouse News Service reports.
The complaint, filed Feb. 15, alleges defendants have committed
and continue to commit multiple violations of the Privacy Act, 5
U.S.C. Section 552a, with respect to the Personal Information
and the Medical Information.
Such violations include, but are not limited to:
(1) disclosing the personal information and the Medical
Information without the prior written consent of the
individuals to which the information pertains;
(2) failing to establish rules of conduct for persons
involved in the design, development, operation or
maintenance of any system of records, or in maintaining
any record, and instruct each such person with respect
to such rules and the requirements of the Privacy Act
and the penalties for non-compliance; and
(3) failing to establish appropriate administrative,
technical and physical safeguards to insure the
security and confidentiality of records and to protect
against any anticipated threats or hazards to their
security or integrity which could result in substantial
harm, embarrassment, inconvenience, or unfairness to
any individual on whom information is maintained.
Named plaintiff Greg Fanin, a member of the Alabama National
Guard who served in both Persian Gulf Wars, says an employee of
the Veterans Affairs' Medical Center in Birmingham reported the
hard drive missing on Jan. 22.
In addition to patient records, the hard drive contained billing
records for 1.3 million doctors, the complaint states, but the
defendant did not announce it until Feb. 2.
Mr. Fanin claims the Veterans Affairs informed him he is at risk
of identity theft, and he claims the Veterans Affairs violated
the Privacy Act and federal regulations by failing to protect
the information and failing to encrypt it.
Plaintiff, on behalf of himself and all others similarly
situated, pray that the court grant the following relief:
-- declare that defendants' acts and admissions constitute
a willful and intentional failure to establish
appropriate safeguards to ensure the security and
privacy of the Personal Information and the Medical
Information to protect against known and anticipated
threats or hazards to the security and integrity of
these records in violation of the Privacy Act and the
Administrative Procedure Act;
-- that the court order injunctive relief enjoining,
prohibiting, and preventing defendants from continuing
to operate without appropriate safeguards to ensure the
security and privacy of the Personal Information and the
Medical Information and similar information and to
protect anticipated threats or hazards to the security
and integrity of these records;
-- that the court permanently enjoin defendant VA, its
officers, agents, employees and those acting for and
with them, from accessing, viewing, handling,
disclosing, or in any way transferring any record or
system of records subject to Privacy Act requirements at
the Birmingham, Alabama VA Medical Center until an
independent panel of experts finds that adequate
information security has been established and
implemented by VA, unless such activity is explicitly
allowed by court order and under supervision of persons
independent of VA, such supervision to be at VA expense;
-- that the court enjoin defendant VA, its officers,
agents, employees and those acting for and with them
from removing any device capable of storing, containing
or transferring any record or system of records,
including, but not limited to, laptop computers,
portable hard drives, memory stick or similar devices
and "iPods" and similar devices, from property under
VA's supervision and control at the Birmingham, Alabama
VA Medical Center until unless VA demonstrates that
adequate information security has been established to
the court's satisfaction;
-- that the court grant to plaintiff and the class
judgment against defendant VA for damages in an amount
not less than $1,000 for each individual who was
adversely affected by defendant's Privacy Act
violations;
-- that the court grant to plaintiffs their costs and
reasonable attorneys' fees; and
-- that the court grant such additional relief as the court
deems proper and just.
A copy of the complaint is available free of charge at:
http://ResearchArchives.com/t/s?182a
The suit is "Fanin v. U.S. Department of Veterans Affairs et
al., Case No. 2:07-cv-00310-IPJ," filed in the U.S. District
Court for the Northern District of Alabama under Judge Inge P.
Johnson.
Representing plaintiffs are Andrew P. Campbell and Caroline
Smith Gidiere both of Campbell Waller & Poer, LLC, 2100-A
Southbridge Parkway, Suite 450, Birmingham, AL 35209, Phone:
803-0051, Fax: 205-803-0053, E-mail: acampbell@cwp-law.com or
cgidiere@cwp-law.com.
UST LIQUIDATING: Plaintiff's Right to Appeal Calif. Suit Lapses
---------------------------------------------------------------
Plaintiff's right to appeal a decision by a California court
finding UST Liquidating Corp. not guilty of breaching fiduciary
duty in relation to the sale of its assets to Veeder-Root
Service Co. has already expired.
In June 2000, a class action complaint was filed against the
company and certain other parties on behalf of certain common
shareholders of the company, alleging that the company and other
parties breached their fiduciary duty to the company's common
shareholders in connection with the Veeder-Root sale
transaction.
A trial was held in March and April 2006. In July 2006, the
court issued its decision, finding no liability on behalf of the
company.
The court issued a ruling that the business judgment rule
applied, because, there were disinterested directors in the
decision process, and that the transaction was fair and the
plaintiffs failed to meet their burden of proving breach of
duty.
The plaintiff's right to appeal expired in January 2007,
according to the company's Feb. 14 Form 10-QSB filing with the
U.S. Securities and Exchange Commission for the quarterly period
ended Dec. 31, 2006.
VESTIN REALTY: Still Faces Lawsuit Over Vestin Fund II Merger
-------------------------------------------------------------
Vestin Realty Mortgage II, Inc. and Vestin Mortgage, Inc. remain
defendants in a breach of contract suit filed in San Diego
Superior Court in California by certain plaintiffs who allege,
among other things, that they were wrongfully denied appraisal
rights in connection with the merger of Vestin Fund II into
Vestin Realty Mortgage II, Inc.
The action is being brought as a purported class action on
behalf of all members of Vestin Fund II who did not vote in
favor of the merger.
Defendants believe that the allegations are without merit and
that they have adequate defenses. They intend to undertake a
vigorous defense.
The terms of the company's management agreement and Vestin Fund
II's Operating Agreement contain indemnity provisions whereby
Vestin Mortgage and Michael V. Shustek may be eligible for
indemnification by the company with respect to the above action.
Vestin Fund III, LLC, did not report any development in the case
at its Nov. 8, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarterly period ended Sept. 30,
2006.
VITA SPECIALTY: Recalls Sauces Over Undeclared Milk Content
-----------------------------------------------------------
Vita Specialty Foods, Inc. of Martinsburg, West Virginia, is
voluntarily recalling certain products because their labels do
not disclose that the products contain a flavor ingredient
derived from milk.
People who have an allergy or severe sensitivity to milk run the
risk of serious or life-threatening allergic reaction if they
consume these products. Anyone who is allergic to milk should
not consume these products. There is no risk to individuals who
are not allergic to milk.
Only these products are affected by this recall:
ITEM SIZE "BEST BEFORE"
DATES
Scorned Woman
Wicked Wing Sauce 18 oz. 5/04/07 - 1/18/08
Jim Beam Hot Wing
Sauce 5 oz. 4/17/07 - 11/7/07
Jim Beam Hot Wing
Sauce 13 oz. 1/26/07 - 12/19/07
Jim Beam Gourmet
Foods Hot Wing Sauce 1 gal. 10/25/07
IU Hoosiers Varsity
Wing Sauce 12 oz. 1/10/07 - 7/26/07
Virginia Tech Hot
Wing Sauce 12 oz. 1/10/07 - 7/26/07
Budweiser Barbecue
Sauce 19 oz., 77 oz, All date codes
1 gal, 5 gal. through 6/11/08
Budweiser Basting 14 oz., 71 oz., All date codes
Sauce 1 gal, 5 gal. through 12/19/07
No illnesses or adverse reactions have been reported to date in
connection with this problem, and there is no risk to consumers
who are not allergic to milk.
The recalled products were distributed nationwide in retail
stores except for the Virginia Tech Hot Wing Sauce and the IU
Hoosiers Varsity Wing Sauce that were distributed in Virginia
and Indiana respectively.
Vita Specialty Foods, Inc., in review of its products and
labels, discovered that these products were distributed with
labels that did not disclose the presence of a flavor ingredient
derived from milk. The labels are being corrected.
Consumers who have purchased these products are urged to dispose
of them or contact Vita Specialty Foods, Inc. at 1-800-974-4778
for a refund. Consumers with questions may contact Vita
Specialty Foods at 1-800-974-4778.
New Securities Fraud Cases
GLOBALSTAR INC: Schiffrin Barroway Files Securities Suit in N.Y.
----------------------------------------------------------------
The law firm of Schiffrin Barroway Topaz & Kessler, LLP filed a
lawsuit in the United States District Court for the Southern
District of New York on behalf of all common stock purchasers of
Globalstar, Inc. from November 2, 2006 through February 5, 2007,
inclusive.
The Complaint charges Globalstar and certain of its officers and
directors with violations of the Securities Exchange Act of
1934.
More specifically, the Complaint alleges that the Company failed
to disclose and misrepresented the following material adverse
facts which were known to defendants or recklessly disregarded
by them:
(1) that the performance of the Company's power
amplification communication system antennas on its
global satellite system was degrading at an accelerated
rate; and
(2) as such, the commercial usefulness of the satellites
was declining at an accelerated rate.
On February 5, 2007, Globalstar disclosed that its power
amplification communication system antennas were degrading at a
greater rate than that disclosed in connection with the IPO
Prospectus.
On this news, shares of the Company's stock declined $4.08 per
share, or 28 percent, to close on February 6, 2007 at $10.40 per
share, on unusually heavy trading volume.
Plaintiff seeks to recover damages on behalf of class members.
Interested parties may move the court no later than April 10,
2007 for lead plaintiff appointment.
For more information, contact Darren J. Check, Esq., or Richard
A. Maniskas, Esq., both of Schiffrin Barroway Topaz & Kessler,
LLP, Phone: +1-888-299-7706 (toll free) or +1-610-667-7706, E-
mail: info@sbtklaw.com, Website: http://www.sbtklaw.com/.
NEW CENTURY: Charles Johnson Announces Securities Suit Filing
-------------------------------------------------------------
Charles H. Johnson & Associates announced that a class action
has been commenced in the United States District Court for the
Central District of California on behalf of purchasers of New
Century Financial Corp. publicly traded securities during the
period May 4, 2006 through February 7, 2007.
The Complaint alleges that New Century and certain of its
officers and directors violated Federal securities laws.
Specifically, the Complaint alleges that defendants made false
and misleading statements concerning the Company's operations
and financial results for the first three quarters of 2006.
During the Class Period defendants failed to disclose that New
Century was being forced to buy-back substantially more loans
than originally had been expected. Despite knowing of the surge
in forced loan repurchases, the defendants failed to properly
account for them.
On February 7, 2007, New Century announced that it was going to
restate its financial results for the first three quarters of
2006 because the Company had failed to account for all of the
repurchased loans, and had failed to properly reduce the value
of the loans repurchased.
The Company was forced to admit that its financial statements
could no longer be relied upon. On this news, New Century shares
fell $10.92, a decline of over 36%, to close at $19.24.
Interested parties may move the court no later than April 10,
2007 for lead plaintiff appointment.
New Century is a mortgage finance company that makes a
substantial number of residential mortgage loans. It does not
hold these loans but sells the loans to banks and investors. The
purchasers can require New Century to repurchase loans which
become troubled.
For more information, contact Neil Eisenbraun, Esq. of Charles
H. Johnson & Associates, 2599 Mississippi Street, New Brighton,
MN 55112, Phone: (651) 633-5685, E-mail: cjohnsonlaw@gmail.com.
*********
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, Ma. Cristina Canson, and Janice
Mendoza, Editors.
Copyright 2007. 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
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Information contained herein is obtained from sources believed
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The CAR subscription rate is $575 for six months delivered via
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