/raid1/www/Hosts/bankrupt/CAR_Public/071218.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, December 18, 2007, Vol. 9, No. 250
Headlines
AFFINION GROUP: Continues to Face Multiple Consumer Fraud Suits
AMERIQUEST MORTGAGE: Checks Sent to Class in $295M Settlement
AT&T MOBILITY: Settles Suit Over Municipality Taxes for $76M
AVX CORP: Faces Lawsuit Over Contamination of S.C. Properties
CANADA: Suit by Public Service Pension Plan Holders Certified
COLORADO: Suit Claims Educ. Dept.'s School Finance Act Illegal
CONSECO INC: Ind. Court Denies Motion to Dismiss Securities Suit
CONSECO INC: Still Faces Lawsuits Over Life Insurance Policies
CONSECO INSURANCE: Seeks Dismissal from Cal. Annuities Lawsuit
DOLLAR FINANCIAL: Cal. Court Dismisses Settled Labor Lawsuits
DYNEGY POWER: Expects 2007 Ruling in Suit Over Power Auction
EDO CORP: Settles Shareholder Lawsuit Over Disposal to ITT Corp.
RELIANT ENERGY: Ninth Circuit Remands Natural Gas Cases
RESIDENTIAL CAPITAL: Pa. Court Approves RESPA Suit Settlement
RESIDENTIAL CAPITAL: Decertification of Ill. FCRA Suit Appealed
RESIDENTIAL CAPITAL: Jan. 2008 Hearing Set for FCRA Suit Deal
RESIDENTIAL CAPITAL: Unit Faces SMLA Violations Lawsuit in Mo.
REWARDS NETWORK: Cal. Court Okays “Bistro Executive” Settlement
SEMCO ENERGY: Mich. Court OKs Settlement of Shareholder Lawsuit
UNIVERSAL HEALTH: Settles Calif. Labor Litigation for $10.4M
VALUECLICK INC: Faces Multiple Securities Fraud Suits in Calif.
VISTEON CORP: Dismissal of Mich. Securities Fraud Suit Appealed
VISTEON CORP: Mich. Court Dismisses Certain Claims in ERISA Case
VWA ASSET: Workers File FLSA Violations Lawsuit in California
WARNER-LAMBERT: Pa. Court Certifies Class in Neurontin Lawsuit
XYBERNAUT CORP: Feb. Hearing Set for $6M Securities Suit Deal
New Securities Fraud Cases
MEDTRONIC INC: Schiffrin Barroway Files Securities Fraud Suit
SYNTAX-BRILLIAN: Zwerling Schachter Files Securities Fraud Suit
VERIFONE HOLDINGS: Kaplan Fox Files Securities Suit in Calif.
ZUMIEZ INC: Schiffrin Barroway Files Wash. Securities Fraud Suit
*********
AFFINION GROUP: Continues to Face Multiple Consumer Fraud Suits
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Affinion Group, Inc., which prior to 2007 was known as the
Trilegiant Corp., along with certain other defendants, still
faces a number of purported class actions alleging violations of
federal or state consumer protection statutes, according to the
company's Nov. 13, 2007 Form 10-K Filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
Aug. 25, 2007.
August 2005 Litigation
On Aug. 9, 2005, a class action was filed against Trilegiant
Corp. in the U.S. District Court for the Northern District of
California.
The claim asserts violations of the Electronic Funds Transfer
Act and various California consumer protection statutes. The
suit seeks unspecified actual damages, statutory damages,
attorneys' fees, costs and injunctive relief.
January 2005 Litigation
On Jan. 28, 2005, a class action complaint was filed against The
Bon, Inc., FACS Group, Inc., and Trilegiant in the Superior
Court of Washington, Spokane County.
The claim asserts violations of various consumer protection
statutes. The company filed a motion to compel arbitration,
which was denied by the court.
The company appealed the court's decision, and the case has been
stayed until the appellate court has ruled on the motion to
compel arbitration.
November 2002 Litigation
On Nov. 12, 2002, a class action complaint was filed against
Sears, Roebuck & Co., Sears National Bank, Cendant Membership
Services, Inc., and Allstate Insurance Co. in the Circuit Court
of Alabama for Greene County alleging, among other things,
breach of contract, unjust enrichment, breach of duty of good
faith and fair dealing and violations of the Illinois consumer
fraud and deceptive practices act.
The case was removed to the U.S. District Court for the Northern
District of Alabama but was remanded to the Circuit Court of
Alabama for Greene County.
The Company has filed a motion to compel arbitration, which is
still pending.
November 2001 Litigation
On Nov. 15, 2001, a class action complaint was filed in Madison
County, Illinois against Trilegiant alleging violations of state
consumer protection statutes in connection with the sale of
certain membership programs.
Motions to dismiss were denied and certification of a class of
consumers has been granted; the exact size of the certified
class is not known at this time.
Affinion Group Holdings, Inc. -- http://www.affiniongroup.com--
is a global provider of integrated marketing and loyalty
solutions to companies around the world. Affinion partners with
other companies to develop customized marketing programs that
provide products and services to their end customers.
AMERIQUEST MORTGAGE: Checks Sent to Class in $295M Settlement
-------------------------------------------------------------
Checks are being mailed to all eligible claimants in the January
2006 settlement of a suit filed against Ameriquest Mortgage Co.
and other affiliated companies over the company's mortgage
lending practices.
An investigation was made into Ameriquest by the Attorneys
General and/or banking and finance regulators of every state
(except Virginia) and the District of Columbia. The claim was
that Ameriquest and other affiliated companies had engaged in
various unlawful mortgage lending practices from January 1, 1999
through December 31, 2005. It included Ameriquest, ACC Capital
Holdings Corp., Town and Country Credit Corp., and AMC Mortgage
Services, Inc. (formerly doing business under the name Bedford
Home Loans). Together, all of these companies are referred to as
“Ameriquest.”
A $295 million Settlement Fund was established to provide
restitution payments to certain Ameriquest borrowers identified
by the States. Beginning July 9, 2007, borrowers who were
eligible for a payment were mailed Notice letters and Release
Forms. The Notice detailed the minimum dollar restitution
payment eligible borrowers could receive.
The $295 million Settlement Fund was divided into two separate
funds of $175 million and $120 million. Borrowers could have
been eligible for a restitution payment from one or both funds.
Eligible for a restitution payment from the $175 million fund
are those who:
* obtained at least one mortgage loan or home equity loan
directly from Ameriquest between January 1, 1999 and
April 1, 2003, and
* the loan met criteria set by the States.
The vast majority of borrowers who obtained a mortgage loan
directly from Ameriquest, Bedford Home Loans, or Town and
Country between January 1, 1999 and April 1, 2003 were eligible
to participate in the Settlement. However, a small number of
loans that closed between January 1, 1999 and April 1, 2003 did
not meet the criteria to be eligible for restitution.
Eligible for a restitution payment from the $120 million fund
are those:
* who obtained at least one mortgage loan or home equity
loan directly from Ameriquest between January 1, 1999 and
December 31, 2005, and
* the loan met criteria set by the States.
Each individual State determined its own criteria for
Distributing its share of the $120 million fund to its
residents, based on the type of loan and other loan
characteristics. The $120 million fund was Distributed to
borrowers who: (1) obtained loans between April 2, 2003 and
December 31, 2005, and (2) met the criteria set by the State
where the borrower lived at the time he or she obtained the
loan.
On Dec. 13, an update on the settlement Web site
http://www.ameriquestmultistatesettlement.cominforms that
checks are being mailed to all eligible borrowers who submitted
a valid and timely Release Form by the deadline.
For more information, contact the Settlement Administrator by:
Calling toll-free 1-800-420-5875 (hearing impaired call 1-
866-494-8274) between the hours of 8:00 a.m. and 7:00 p.m.,
Central Time, Monday through Friday;
Sending an e-mail to
info@ameriquestmultistatesettlement.com; or
Writing to:
Ameriquest Settlement Administrator
P.O. Box 1855, Faribault, MN 55021-7110
AT&T MOBILITY: Settles Suit Over Municipality Taxes for $76M
------------------------------------------------------------
A state judge in St. Louis granted preliminary approval to a $76
million settlement of a class action filed against AT&T Mobility
in relation to municipality taxes levied on wireless carriers,
reports say.
Under the settlement, AT&T will also pay attorneys' fees of
$10.9 million. The agreement settles a suit filed by
approximately 250 cities.
The agreement covers back taxes for 27 months —- Sept. 1, 2005,
to Nov. 30, 2007, according to John Mulligan Jr. of Clayton, the
lawyer who led the collection efforts for the cities.
AT&T officials argued that the tax is reserved for utilities and
landline phone companies that provided cell phone service, but
AT&T Mobility, they argued, does not fall into that category.
The class action also includes five other phone companies:
Verizon Wireless Inc. (NYSE: VZ), T-Mobile USA Inc., U.S.
Cellular, Sprint Nextel Corp. (NYSE: S) and Alltel Wireless.
Verizon agreed in the summer to pay $31.5 million.
Final agreements should be concluded in the next three months,
said Mr. Mulligan.
“We look forward to working with all of the parties involved, as
prescribed by the courts, with the goal of reaching final
settlement in May 2008,” AT&T Mobility said in a statement. St.
Louis County Circuit Judge Bernhardt C. Drumm Jr. is set to
decide on that month whether to finally approve the settlement.
AVX CORP: Faces Lawsuit Over Contamination of S.C. Properties
-------------------------------------------------------------
Surfside Beach, South Carolina lawyer Gene Connell filed a class
action on behalf of all home and business owners in a
neighborhood near AVX Corp. facility in Myrtle Beach where toxic
contamination has been found.
The suit follows that of Horry Lanch, which claims
trichloroethylene contamination contamination has migrated onto
its property from AVX, and it wants the manufacturer to pay $5.4
million in damages.
Mr. Connell wants AVX to pay those property owners the fair-
market value for their contaminated land, an amount that could
top tens of millions of dollars. That is because S.C. law
requires property sellers to disclose all defects and dangerous
conditions to prospective buyers.
"No one is going to want to buy those homes for fear that the
contamination might cause damage to their children, much less
their property," Mr. Connell said.
For more information, contact:
Gene M. Connell Jr., Esq.
Kelaher, Connell & Connor, P.C.
P.O. Box 14547
1500 Us Hwy 17 N
Surfside Beach, SC 29587-4547
Phone: (843) 238-5648
(843) 238-1033
(843) 238-5017
Fax: (843) 238-5050
CANADA: Suit by Public Service Pension Plan Holders Certified
-------------------------------------------------------------
A class action proceeding has been certified against the
Province of British Columbia on behalf of the members of the
British Columbia Public Service Pension Plan who were presently
entitled to receive premium-free Medical Services Plan Benefits
and Extended Health Care Benefits, and who retired on or before
November, 2002.
The representative plaintiff for this class action is Frederick
Bennett.
The plaintiff is represented by the law firm of Albert Peeling
in Victoria, as well as Koskie Minsky LLP in Toronto and
Underhill Faulkner Boies Parker Law Corporation in Vancouver and
Victoria.
Plan Members claim damages against the Government for breaching
fiduciary obligations with respect to the provision of premium-
free Medical Services Plan Benefits and Extended Health Care
Benefits. Additionally, Plan Members who were directly employed
by the Government claim damages for breaching contractual
obligations with respect to the applicable medical benefits.
On November 13, 2007, Madam Justice Dorgan of the Supreme Court
of British Columbia approved the release of the attached Notice
to all of the members of the Class, setting out the nature of
the claim.
The litigation will now proceed to the document and oral
discovery stages.
Deadline to file for exemption is on March 31, 2008.
For more information, contact:
Koskie Minsky
"BC Benefits Class Action"
Albert Peeling
c/o Underhill Faulkner Boies Parker Law Corporation
1124 Fort Street, Victoria
BC V8V 3K8
Phone: 1-888-502-7455
E-mail: bcbenefitsclassaction@kmlaw.ca
COLORADO: Suit Claims Educ. Dept.'s School Finance Act Illegal
--------------------------------------------------------------
The Colorado Dept. of Education is facing a class action over
the 2007 School Finance Act, a property-tax plan to prop up
school funding, reports say.
The suit was filed by the Independence Institute on behalf of
several named taxpayers as well as Colorado taxpayers in
general. The lawsuit was filed on behalf of six plaintiffs and
taxpayers, including the Mesa County Board of Commissioners and
Main Street Cafe in Grand Junction and a former Boulder County
school board member, according to Rocky Mountain News. It is
asking a Denver District Court to strike down the new law,
arguing it amounts to a tax policy change.
Jon Caldara, president of the Institute, says the new law
requires a vote of the people as provided by the Taxpayer's Bill
of Rights.
Richard Westfall, an attorney who filed the lawsuit, said he
will ask the court to fast-track the complaint before property
tax bills are delivered in January.
For more information, contact:
Richard A. Westfall, Esq.
Hale Friesen, LLP
1430 Wynkoop Street
Suite 300
Denver, CO 80202
Phone: (720) 904-6000
Fax: (720) 904-6006
CONSECO INC: Ind. Court Denies Motion to Dismiss Securities Suit
----------------------------------------------------------------
The U.S. District Court for the Southern District of Indiana
denied a motion to dismiss a second amended complaint in a
consolidated securities class action filed against Conseco,
Inc., and some of its former officers.
After the company’s predecessor (Conseco, Inc., incorporated in
Indiana) announced its intention to restructure on Aug. 9, 2002,
eight purported securities fraud class actions were filed in the
U.S. District Court for the Southern District of Indiana.
These suits were filed on behalf of persons or entities that
purchased its Predecessor's common stock on various dates
between Oct. 24, 2001 and Aug. 9, 2002.
The plaintiffs allege claims under Sections 10(b) and 20(a) of
the U.S. Securities Exchange Act of 1934, as amended and allege
material omissions and dissemination of materially misleading
statements regarding, among other things, the liquidity of
Conseco and alleged problems in Conseco Finance Corp.’s
manufactured housing division, allegedly resulting in the
artificial inflation of the company's Predecessor's stock price.
On March 13, 2003, all of these cases were consolidated into one
case in the U.S. District Court for the Southern District of
Indiana, captioned, “Franz Schleicher, et al. v. Conseco, Inc.,
Gary Wendt, William Shea, Charles Chokel and James Adams, et
al., Case No. 02-CV-1332 DFH-TAB.”
The complaint seeks an unspecified amount of damages. The
plaintiffs filed an amended consolidated class action complaint
with respect to the individual defendants on Dec. 8, 2003.
A motion to dismiss was filed on behalf of defendants Mr. Shea,
Mr. Wendt and Mr. Chokel and on July 14, 2005, this matter was
dismissed.
Plaintiffs filed a second amended complaint on Aug. 24, 2005.
The company filed a motion to dismiss the second amended
complaint on Nov. 7, 2005. This motion was denied on Sept. 12,
2007, according to Conseco, Inc.'s Nov. 8, 2007 Form 10-Q Filing
with the U.S. Securities and Exchange Commission for the
quarterly period ended Sept. 30, 2007.
The suit is “Schleicher, et al. v. Wendt, et al., Case No. 1:02-
cv-01332-DFH-TAB,” filed in the U.S. District Court for the
Southern District of Indiana under Judge David Frank Hamilton
with referral to Judge Tim A. Baker.
Representing the plaintiffs are:
Kwasi Abraham Asiedu, Esq.
3858 Carson Street, Suite 204
Torrance, CA 90503
Phone: (310) 792-3948
Fax: (310) 792-0600
E-mail: laskido@hotmail.com
- and -
Brian Joseph Barry, Esq.
Law Offices Of Brian Barry
1801 Avenue of the Stars, Suite 307
Los Angeles, CA 90046
Phone: (310) 788-0831
Fax: (310) 788-0841
E-mail: bribarry1@yahoo.com
Representing the defendants are:
Steven Kenneth Huffer, Esq.
Huffer & Weathers
151 North Delaware Street, Suite 1850
Indianapolis, IN 46204
Phone: (317) 822-8010
Fax: (317) 822-8088
E-mail: steve_huffer@hufferandweathers.com
- and -
Robert J. Kopecky, Esq.
Kirkland & Ellis
200 East Randolph Drive
Chicago, IL 60601
Phone: (312) 861-2084
Fax: (317) 660-0412
E-mail: rkopecky@kirkland.com
CONSECO INC: Still Faces Lawsuits Over Life Insurance Policies
--------------------------------------------------------------
Conseco, Inc., and certain subsidiaries, including principally
Conseco Life Insurance Co., continue to face several purported
class actions over its sale of life insurance policies in
Indiana, Pennsylvania, California, and Illinois, according to
Conseco, Inc.'s Nov. 8, 2007 Form 10-Q Filing with the U.S.
Securities and Exchange Commission for the quarterly period
ended Sept. 30, 2007.
The suits alleges breach of contract, fraud and
misrepresentation in relation to a change made in 2003 and 2004
in the way cost of insurance charges are calculated by the
company for life insurance policies sold primarily under the
names “Lifestyle,” and “Lifetime.”
Mangelson Litigation
Those cases filed in Superior Court, Hamilton County, Indiana
were consolidated as “Arlene P. Mangelson, et al. v. Conseco
Life Insurance Company, Cause No. 29D01-0403-PL-211.”
Cost of Insurance Cases
Four putative nationwide and/or statewide class actions filed in
California state courts have been consolidated and are being
coordinated in the Superior Court of San Francisco County under
the new caption “Cost of Insurance Cases, Judicial Council
Coordination Proceeding No. 4384” (Judicial Council of
California).
Schwartz Litigation
On Jan. 25, 2005 an amended complaint making similar allegations
as filed in the case, “William Schwartz v. Jeffrey Landerman,
Diann P. Urbanek, Metro Insurance, Inc., Samuels Jacky Insurance
Agency, Conseco Life Insurance Co., Successor to Philadelphia
Life Insurance Co., Case No. GD 00-011432,” filed in the Court
of Common Pleas, Allegheny County, Pennsylvania.
Additionally, Mr. Schwartz filed a purported nationwide class
action, “William Schwartz and Rebecca R. Frankel, Trustee of the
Robert M. Frankel Irrevocable Insurance Trust v. Conseco Life
Ins. Co. et al., Case No. GD 05-3742,” filed in the Court of
Common Pleas, Allegheny County, Pennsylvania.
On May 12, 2006 these two Schwartz cases were consolidated under
both original case numbers.
Harte Litigation
On May 24, 2005 a purported class action was filed in Illinois
on behalf of a putative statewide class captioned 'William J.
Harte, individually and on behalf of all others similarly
situated v. Conseco Life Insurance Company, Case No. 05CH08925
(Circuit Court of Cook County, Illinois, Chancery Division),"
which has been removed to the U.S. District Court for the
Northern District of Illinois, transferred to California and
consolidated and coordinated with “In re Conseco Life Insurance
Co. Cost of Insurance Litigation, MDL 1610.”
Conseco, Inc. -- https://www.conseco.com/ -- is the holding
company for a group of insurance companies operating throughout
the U.S. that develop, market and administer supplemental health
insurance, annuity, individual life insurance, and other
insurance products.
CONSECO INSURANCE: Seeks Dismissal from Cal. Annuities Lawsuit
--------------------------------------------------------------
The U.S. District Court for the Northern District of California
has yet to rule on a motion to dismiss Conseco Insurance
companies in a consolidated consumer lawsuit filed against them
over sales of annuity products to seniors 65 years and older.
On Nov. 17, 2005, the complaint “Robert H. Hansen v. Conseco
Insurance Co., f/k/a Conseco Annuity Assurance Co., Case No.
C0504726” was filed in the U.S. District Court for the Northern
District of California.
Plaintiff in this putative class action purchased an annuity in
2000 and is claiming relief on behalf of the proposed national
class over alleged:
-- violations of the Racketeer Influenced and
Corrupt Organizations Act;
-- elder abuse;
-- unlawful, deceptive and unfair business practices;
-- unlawful, deceptive and misleading advertising;
-- breach of fiduciary duty; aiding and abetting of breach
of fiduciary duty; and
-- unjust enrichment and imposition of constructive trust.
On Jan. 27, 2006, a similar complaint was filed in the same
court, “Friou P. Jones, on Behalf of Himself and All Others
Similarly Situated v. Conseco Insurance Company, an Illinois
company f/k/a Conseco Annuity Assurance Company, Cause No. C06-
00537.” Mr. Jones had purchased an annuity in 2003.
Each case alleged that the annuity sold was inappropriate and
that the annuity products in question are inherently unsuitable
for seniors age 65 and older.
On March 3, 2006 a first amended complaint was filed in the
Hansen case adding causes of action for fraudulent concealment
and breach of the duty of good faith and fair dealing.
In an order dated April 14, 2006, the court consolidated the two
cases under the original Hansen cause number and retitled the
consolidated action: “In re Conseco Insurance Co. Annuity
Marketing & Sales Practices Litigation.”
A motion to dismiss the amended complaint was granted in part
and denied in part, and the plaintiffs filed a second amended
complaint on April 27, 2007.
The second amended complaint includes the same causes of action
as the prior complaint, but added as defendants Conseco, Inc.,
Conseco Services, LLC, Conseco Marketing, LLC and 40|86
Advisors, Inc. while deleting Friou Jones as a named plaintiff.
The company filed a motion to dismiss the second amended
complaint and it was granted in part and denied in part.
A motion to dismiss Conseco, Inc., Conseco Services, LLC,
Conseco Marketing, LLC and 40|86 Advisors, Inc. was filed on
Sept. 14, 2007, and the company awaits a ruling on the motion,
according to Conseco, Inc.'s Nov. 8, 2007 Form 10-Q Filing with
the U.S. Securities and Exchange Commission for the quarterly
period ended Sept. 30, 2007.
The suit is “Robert H. Hansen v. Conseco Insurance Co., Case No.
5:05-cv-04726-RMW,” filed in the U.S. District Court for the
Northern District of California under Judge Ronald M. Whyte with
referral to Judge Richard Seeborg.
Representing the plaintiffs are:
Howard D. Finkelstein, Esq.
Finkelstein & Krinsk
501 West Broadway, Suite 1250
San Diego, CA 92101-3593
Phone: 619-238-1333
Fax: 619-238-5425
E-mail: fk@classactionlaw.com
Andrew S. Friedman, Esq.
Bonnett Fairbourn Friedman & Balint, P.C.
2901 N. Central Avenue, Suite 1000
Phoenix, AZ 85012
Phone: 602-274-1100
Fax: 602-274-1199
- and -
John J. Stoia, Jr., Esq.
Lerach Coughlin Stoia Geller Rudman & Robbins, LLP
655 West Broadway, Suite 1900
San Diego, CA 92101
Phone: (619) 231-1058
Fax: (619) 231-7423
E-mail: jstoia@lerachlaw.com
Representing the defendants are:
Thomas A. Doyle, Esq.
James J. Dries, Esq.
Mark L. Karasik, Esq.
Baker & McKenzie, LLP
130 E. Randolph Drive, Suite 3500
Chicago, IL 60601
Phone: 312-861-8000
Fax: 312-861-2899
E-mail: Thomas.A.Doyle@bakernet.com
James.J.Dries@bakernet.com
Mark.L.Karasik@bakernet.com
DOLLAR FINANCIAL: Cal. Court Dismisses Settled Labor Lawsuits
-------------------------------------------------------------
A California court dismissed three of four wage-and-hour class
actions that was filed against Dollar Financial Corp. and was
subsequently settled.
Initially the company was named as a defendant in four lawsuits
commenced by the same law firm. Each lawsuit was pled as a
class action, and each lawsuit alleges violations of
California's wage-and-hour laws.
The named plaintiffs are former employees:
-- Vernell Woods (suit commenced Aug. 22, 2000),
-- Juan Castillo (suit commenced May 1, 2003),
-- Stanley Chin (suit commenced May 7, 2003), and
-- Kenneth Williams (suit commenced June 3, 2003)
Each of these suits sought an unspecified amount of damages and
other relief in connection with allegations that the company:
-- misclassified California store (Woods) and area
(Castillo) managers as "exempt" from a state law
requiring the payment of overtime compensation;
-- the company failed to provide non-management employees
with meal and rest breaks required under state law
(Chin); and
-- the company computed bonuses payable to its store
managers using an impermissible profit-sharing formula
(Williams).
The trial court in “Chin” denied plaintiff's motion for class
certification. Plaintiffs appealed that ruling and in May 2006,
the Appellate Court affirmed the denial of class certification.
On March 15, 2006, the company reached a settlement in the
Woods, Castillo and Williams actions, and the court granted
preliminary approval of that settlement on June 19, 2006.
The company agreed to settle Woods for $4,000,000, Castillo for
$1,100,000, and Williams for $700,000. The total amount paid to
the class members in “Woods,” and “Castillo” may increase if the
company's estimate of the total number of workweeks for those
classes proves to be too low. It is unlikely that the
settlement amounts for “Woods” or “Castillo” will increase by
more than twenty percent.
The court granted approval of that settlement in October of
2006.
The Company agreed to settle these cases for a total of $5.8
million and a settlement distribution, including payment to the
attorneys for fees and costs occurred on Jan. 11, 2007.
On Oct. 2, 2007, the court held a final accounting hearing
regarding the distribution of the settlement funds. At that
hearing, the court dismissed the consolidated cases.
Dollar Financial Corp. -- http://www.dfg.com-- is an
international financial services company serving under-banked
consumers. The Company provides a range of consumer financial
products and services primarily consisting of check cashing,
single-payment consumer loans, longer-term installment loans,
money orders, money transfers, and legal document processing
services.
DYNEGY POWER: Expects 2007 Ruling in Suit Over Power Auction
------------------------------------------------------------
Dynegy Power Marketing, Inc., a subsidiary of Dynegy, Inc.,
expects a 2007 decision on the dismissal of claims in two
purported class actions related to the Illinois reverse power
procurement auction.
Attorney General’s Complaint
On March 15, 2007, as amended on March 16, 2007, the Attorney
General of the State of Illinois filed a complaint at the
Federal Energy Regulatory Commission against 16 electricity
suppliers engaged in wholesale power sales, challenging the
results of the Illinois reverse power procurement auction
conducted in September 2006 (Class Action Reporter, Sept. 14,
2007).
The complaint alleges that the prices charged under supply
contracts resulting from the auction process are not just and
reasonable.
It also requests that FERC investigate purported price
manipulation by the wholesale suppliers in the auction process.
The complaint names Dynegy Power among the respondents.
The public version of the complaint served upon Dynegy Power is
heavily redacted resulting in substantial uncertainty regarding
the specific allegations against DPM and the specific relief
sought by the IAG against DPM.
Class Actions
Shortly after the Attorney General’s filing at FERC, two civil
class action complaints against 21 wholesale electricity
suppliers and utilities, including Dynegy Power, were filed in
Illinois state court.
The complaints largely mirror the Attorney General’s filing and
seek unspecified actual and punitive damages.
In April 2007, the cases were removed to federal court, and in
June 2007, the defendants moved to dismiss plaintiffs’ claim on
grounds of the filed rate doctrine and preemption.
In October 2007, at the request of the Court, the parties
provided supplemental briefs on the impact of the FERC dismissal
order and the Illinois rate relief package.
A decision on defendants’ motion to dismiss is expected in the
fourth quarter 2007, according to the company's Nov. 8, 2007
Form 10-Q Filing with the U.S. Securities and Exchange
Commission for the quarterly period ended Sept. 30, 2007.
Dynegy, Inc. -- http://www.dynegy.com/-- is a holding company
focused on the power generation sector of the energy industry.
The Company’s primary business is the production and sale of
electric energy, capacity and ancillary services from its
11,739-megawatt fleet (20 plants) of owned or leased power
generation facilities. Dynegy’s power generation facilities
generate electricity by burning coal, natural gas or oil.
EDO CORP: Settles Shareholder Lawsuit Over Disposal to ITT Corp.
----------------------------------------------------------------
Edo Corp. agreed to issue supplemental disclosures to settle a
consolidated shareholder lawsuit filed against it over a planned
disposal of the company to ITT Corp.
On November 5, 2007, EDO Corp. filed with the U.S. Securities
and Exchange Commission a definitive proxy statement in
connection with the proposed acquisition of the Company by ITT
Corp., an Indiana corporation, pursuant to the previously
announced Agreement and Plan of Merger, dated as of September
16, 2007, among the Company, ITT and Donatello Acquisition
Corp., a New York corporation and a wholly-owned subsidiary of
ITT (Merger Sub).
As disclosed in the Definitive Proxy Statement, on October 15,
2007, one of the company's shareholders, the City of Bethlehem
Aggregated Pension Fund, filed in the Supreme Court of the State
of New York, New York County, a putative shareholder
class action against the Company and the individual members of
the Board of Directors.
The complaint alleges, among other things, that the proposed
acquisition of the Company by ITT substantially undervalues our
common shares and unfairly benefits the Company's insiders. The
plaintiff seeks injunctive relief with regard to the proposed
acquisition. On November 1, 2007, plaintiff filed an amended
complaint, adding allegations that the preliminary proxy
statement filed by the Company on October 23, 2007 failed to
disclose material non-public information concerning the
financial position and prospects of the Company.
On October 26, 2007, one of the company's shareholders, Mr.
Samuel Pill, filed in the Supreme Court of the State of New
York, New York County, a substantially similar putative
shareholder class action against the individual members of the
Board of Directors, the Company, ITT and Merger Sub. The
complaint alleges, among other things, that the $56.00 per share
merger consideration is inadequate and unfair to the public
shareholders of the Company and that the preliminary proxy
statement filed by the Company on October 23, 2007 failed to
disclose material non-public information concerning the
financial position and prospects of the Company. The plaintiff
seeks injunctive relief with regard to the proposed transaction.
On November 29, 2007, the two actions were consolidated in the
Supreme Court of the State of New York, New York County, under
the caption, “In re EDO Corp. Shareholders Litigation (Index No.
603400/07).” Also on November 29, 2007, the Company made
supplemental disclosure in the form of additional proxy
soliciting materials filed on Form DEFA14A containing
additional financial information, which were updated on December
4, 2007.
A consolidated complaint was filed in the Action on December 5,
2007. A hearing on plaintiffs' motion for a preliminary
injunction was scheduled for December 12, 2007.
EDO has elected to make the following supplemental disclosures
in an effort to provide you with additional information as you
consider your vote on the proposed merger, as part of its
settlement of the Action pursuant to a Memorandum of
Understanding entered into among the parties on December 7,
2007, which Memorandum of Understanding provides that the
parties will enter into a definitive settlement and release
agreement and that any such settlement and release agreement is
subject to court approval and to the completion of the
transaction. Upon approval, the Settlement will be binding on
all shareholders.
Also pursuant to the Settlement, ITT agreed that the amount of
the Company Termination Fee payable by the Company under certain
circumstances would be $40 million, rather than $47 million. The
amount of the Parent Expenses payable by the Company under
certain circumstances was not modified.
RELIANT ENERGY: Ninth Circuit Remands Natural Gas Cases
-------------------------------------------------------
Certain lawsuits filed against Reliant Energy, Inc. over natural
gas prices have been remanded by the U.S. Court of Appeals for
the Ninth Circuit for further proceedings at the trial court
level.
Initially, the company was party to 27 lawsuits, several of
which are class actions, in state and federal courts in
California, Colorado, Kansas, Missouri and Wisconsin.
These lawsuits relate to alleged conduct to increase natural gas
prices in violation of antitrust and similar laws. They seek
treble damages, restitution and/or expenses.
Plaintiffs also name a number of unaffiliated energy companies
as parties.
In September 2007, the Ninth Circuit issued decisions in a
number of the gas cases in which the company is a defendant.
The Ninth Circuit Court of Appeals reversed a series of lower
court decisions holding that the filed rate doctrine barred the
plaintiff’s claims in those cases.
As a result of the Ninth Circuit Court of Appeals rulings, these
cases have been remanded for further proceedings at the trial
court level, according to the company's Nov. 8, 2007 Form 10-Q
Filing with the U.S. Securities and Exchange Commission for the
quarterly period ended Sept. 30, 2007.
Reliant Energy, Inc. -- http://www.reliant.com-- is a provider
of electricity and energy services to retail and wholesale
customers through two business segments.
RESIDENTIAL CAPITAL: Pa. Court Approves RESPA Suit Settlement
-------------------------------------------------------------
The U.S. District Court for the Eastern District of Pennsylvania
gave final approval to a settlement of the purported class
action, “Santiago v. GMAC Mortgage Group, Inc. et al., Case No.
2:02-cv-04048-JKG,” which names a subsidiary of Residential
Capital, LLC, as a defendant.
The putative class action was filed against the company's
subsidiary in June 2002 in the U.S. District Court for the
Eastern District of Pennsylvania.
Plaintiffs assert violations of Section 8(b) of RESPA based on
the alleged collection of “unearned fees for settlement
services” composed of an $85 tax service fee, a $20 flood
certification fee, and a $250 funding fee.
The putative nationwide class consists of “all persons who, on
or after Jan. 1, 1995 - paid fees for tax service, flood
certification, and/or underwriting.”
In September 2003, the district court dismissed plaintiffs’
causes of action under RESPA as to all three fees for failure to
state a claim.
Plaintiffs appealed to the U.S. Court of Appeals for the Third
Circuit, which affirmed the dismissal as to an alleged
overcharge concerning the funding fee, but reversed the district
court’s dismissal as to alleged additional charges for further
proceedings, including discovery and motions, on both of these
RESPA issues and ancillary state law claims.
After filing an answer to the claims denying the allegations,
the subsidiary conducted preliminary discovery in conjunction
with court-supervised mediation.
As a result of that mediation, an agreement was reached to
settle part of the claims on a class basis with all of the other
claims to be dismissed on an individual basis.
The settlement provides for a total payment of $625,000 to be
split evenly between the class and plaintiffs’ counsel.
The settlement was finally approved by the court on Aug. 7,
2007. There were no objectors.
Plaintiff’s counsel has been paid and 81,965 settlement checks
(in denominations of either $14.40 or $2.00) have been
distributed to class members. Any funds remaining after one
year will be paid to charity.
The suit is “Santiago v. GMAC Mortgage Group, Inc. et al., Case
No. 2:02-cv-04048-JKG,” filed in the U.S. District Court for the
Eastern District of Pennsylvania
Representing the plaintiffs are:
Daniel E. Bacine, Esq.
Barrack Rodos & Bacine
3300 Two Commerce Sq., 2001 Market St.
Philadelphia, PA 19103
Phone: 215-963-0600
E-mail: dbacine@barrack.com
Timothy G. Blood, Esq.
Milberg Weiss Bershad Hynes & Lerach LLP
401 B St., Ste. 1700
San Diego, CA 92101
Phone: 619-231-1058
- and -
Joann Shields, Esq.
Shields Law Firm, P.C.
185 South State Street, 13th Floor
Salt Lake City, UT 84111
Phone: 801-257-7976
E-mail: jshields@shieldslawfirm.net
Representing the defendants is:
Robert A. Nicholas, Esq.
Reed Smith LLP
1650 Market St., 2500 One Liberty Pl.
Philadelphia, PA 19103
Phone: 215-851-8100
Fax: 215-851-1420
E-mail: rnicholas@reedsmith.com
RESIDENTIAL CAPITAL: Decertification of Ill. FCRA Suit Appealed
---------------------------------------------------------------
Plaintiffs in a lawsuit filed against a subsidiary of
Residential Capital, LLC are appealing an order vacating a
certification of the suit. The suit was filed in the U.S.
District Court for the Northern District of Illinois in March
2005.
In the suit, “Murray v. GMAC Mortgage Corporation, Case No.
1:2005cv01229,” plaintiff’s counsel alleges that the company's
subsidiary, in sending a “pre-approved offer” to the plaintiff,
accessed the plaintiff’s credit report without authorization
from the plaintiff and without a “permissible purpose” under the
Fair Credit Reporting Act (FCRA) since the material allegedly
did not qualify as a “firm offer of credit.”
The suit also alleges that the material failed to make FCRA
required notices and disclosures in a “clear and conspicuous”
manner.
Plaintiff seeks statutory penalties for an allegedly willful
violation of the statute.
Class certification was denied by the district court, but that
decision was reversed on appeal and the matter remanded to the
district court for further proceedings, including amended cross-
motions for summary judgment as well as a renewed motion for
class certification.
On April 10, 2007, the district court certified a narrow class
limited to those residents of Will County, Illinois who received
the mailer in question during the fall of 2004 and who can be
identified from any available mailing list.
The district court also granted in part and denied in part each
of the parties’ summary judgment motions, opining that the
mailer in question did not constitute a firm offer of credit,
entering judgment in favor of our subsidiary on the clear and
conspicuous disclosure issue, and finding a genuine issue of
fact with respect to whether the alleged violation of FCRA could
be said to be willful.
On June 5, 2007, the company's subsidiary filed a motion for
reconsideration on the willfulness issue based upon the U.S.
Supreme Court decision in “Safeco Ins. Co., et al. v. Burr, et
al.”
Upon reconsideration, on July 2, 2007, the district court
vacated its order certifying the class and granted the
subsidiary’s motion for summary judgment on the willfulness
issue, entering judgment on behalf of the subsidiary.
Plaintiffs have filed an appeal, which the subsidiary intends to
vigorously contest.
The suit is “Murray v. GMAC Mortgage Corporation, Case No.
1:2005cv01229,” filed in the U.S. District Court for the
Northern District of Illinois under Judge David H. Coar.
Representing the plaintiffs is:
Daniel A. Edelman, Esq.
Edelman, Combs, Latturner & Goodwin, LLC
120 South LaSalle Street, 18th Floor
Chicago, IL 60603
Phone: (312) 739-4200
E-mail: courtecl@edcombs.com
Representing the defendants is:
Thomas Justin Cunningham, Esq.
Locke Lord Bissell & Liddell LLP
111 South Wacker Drive
Chicago, IL 60606
Phone: (312) 443-0700
E-mail: tcunningham@lockelord.com
RESIDENTIAL CAPITAL: Jan. 2008 Hearing Set for FCRA Suit Deal
-------------------------------------------------------------
A Jan. 7, 2008 fairness hearing is set for a settlement of a
purported class action filed against a subsidiary of Residential
Capital, LLC over alleged violations of the Fair Credit
Reporting Act.
The putative class action was filed against the company's
subsidiary in the U.S. District Court for the Central District
of California in August 2005.
In general, the suit alleges that the company's subsidiary, in
sending a pre-approved offer to the plaintiff, accessed the
plaintiffs credit report without authorization from the
plaintiff and without a permissible purpose under the Fair
Credit Reporting Act (FCRA) since the material allegedly did not
qualify as a firm offer of credit.
It also alleges that the material failed to make FCRA required
notices and disclosures in a clear and conspicuous manner.
The litigation is essentially a copycat of the Murray case and
seeks to recover for essentially the same alleged conduct
although for a later class period and on behalf of a putative
nationwide class that excludes any residents of Will County,
Illinois.
The district court granted the subsidiary's motion to dismiss in
part, striking four counts seeking declaratory and injunctive
relief, and has permitted the case to go forward on the same
firm offer of credit claims present in Murray. (The plaintiff
has voluntarily withdrawn her clear and conspicuous disclosure
claims.)
On June 28, 2007, while a class certification motion was pending
and summary judgment motions had not yet been filed, the parties
reached a settlement agreement in principle.
The court preliminarily approved the settlement on Sept. 13,
2007 with respect to a settlement class of 1.4 million members,
each of whom is to be offered a free credit report and one year
of free credit monitoring.
The company's subsidiary has agreed not to contest an award of
class counsel’s fees up to $1.1 million.
A hearing on final approval is set for Jan. 7, 2008.
The suit is Vasuki Parthiban v. GMAC Mortgage Corporation, Case
No. 8:05-cv-00768-ODW-MLG, filed in the U.S. District Court for
Central District of California under Judge Otis D. Wright, II
with referral to Judge Marc L. Goldman.
Representing the plaintiffs are:
Douglas Bowdoin, Esq.
Douglas Bowdoin
255 South Orange Avenue, Suite 800
Orlando, FL 32801
Phone: 407-422-0025
E-mail: ctassi@bowdoinlaw.com
- and -
Jill H. Bowman, Esq.
James Hoyer Newcomer & Smiljanich
4830 West Kennedy Boulevard, Suite 550
Tampa, FL 33609
Phone: 813-286-4100
RESIDENTIAL CAPITAL: Unit Faces SMLA Violations Lawsuit in Mo.
--------------------------------------------------------------
A subsidiary of Residential Capital, LLC continues to face a
purported class action that was filed on July 29, 2003 in state
court in Kansas City, Missouri over alleged violations of the
Missouri Second Mortgage Loan Act (SMLA), Mo.R.S. Section
408.233, based on the lenders’ charging or contracting for
payment of allegedly unlawful closing costs and fees.
The relief sought includes a refund of all allegedly illegal
fees, the refund of interest paid, and the discounted present
value of interest to be paid in the future on active loans.
The plaintiffs also seek prejudgment interest and punitive
damages.
The company's subsidiary is an assignee. The plaintiffs contend
that our subsidiary is strictly liable for the lender’s
(Mortgage Capital Resources Corp.) alleged SMLA violations
pursuant to the assignee provisions of the Home Ownership and
Equity Protection Act of 1994 (HOEPA), 15 U.S.C. Section
1641(d)(1).
The Mitchell case involves approximately 258 Missouri second
mortgage loans made by MCR and assigned to our subsidiary.
The Plaintiffs and the class are seeking approximately $6.7
million in actual and statutory damages plus prejudgment
interest, attorney’s fees and expenses. The plaintiff’s counsel
will seek a contingent fee of approximately 40% plus litigation
expenses.
In addition plaintiffs will seek prejudgment interest and
punitive damages.
The parties participated in a mediation in August 2007 without
success. MCR is currently in the process of being liquidated in
a Chapter 7 bankruptcy.
The company subsidiary terminated its relationship with MCR in
early May 2000. The case has been scheduled for trial beginning
on Dec. 3, 2007.
Residential Capital, LLC -- https://www.rescapholdings.com/ --
is a wholly owned subsidiary of GMAC Mortgage Group, LLC, which
is a wholly owned subsidiary of GMAC LLC (GMAC). The Company is
real estate finance company focused primarily on the residential
real estate market. Its businesses include the origination,
purchase, service, sale and securitization of residential
mortgage loans. The Company conducts its operations primarily
through three operating business segments: Residential Finance
Group, Business Capital Group and International Business Group.
REWARDS NETWORK: Cal. Court Okays “Bistro Executive” Settlement
---------------------------------------------------------------
The U.S. District Court for the Central District of California
gave final approval to a proposed settlement in a purported
class action filed against Rewards Network, Inc., according to
the company's Nov. 8, 2007 Form 10-Q Filing with the U.S.
Securities and Exchange Commission for the quarterly period
ended Sept. 30, 2007.
Case Background
On May 25, 2004, Bistro Executive, Inc.; Westward Beach
Restaurant Holdings, LLC; and MiniBar Lounge filed a complaint
in the Los Angeles County Superior Court against the company and
its subsidiaries (Class Action Reporter, June 14, 2007).
Plaintiffs were all participants in the company's dining credits
Purchase Plan (Dining Plan), and their respective owners.
The complaint was brought as a putative class action and alleges
that amounts paid by the company under the Dining Plan
constituted loans in violation of California usury laws and the
California Unfair Competition Law.
The suit seeks, among other relief, damages and equitable and
injunctive relief, including disgorgement of all purported
“interest” and profits earned by the company from the Dining
Plan in California, which plaintiffs allege to be a significant
portion of an amount in excess of $300 million, and treble
damages for all purported “interest” paid within one year prior
to the filing of the complaint.
On June 25, 2004, the action was removed to the U.S. District
Court for the Central District of California.
On Oct. 11, 2005, plaintiffs' motion for class certification was
granted certifying two classes as:
-- all California restaurants which, from May 25, 2000 to
May 25, 2004, participated in the Dining Plan and which
took a cash advance from the company pursuant to its
California Dining Plan agreements;: and
-- all persons who, from May 25, 2000 to May 25, 2004,
guaranteed payment of cash advances underlying the
company's California Dining Plan agreements.
On July 20, 2006, the U.S. District Court for the Central
District of California issued a decision denying the company's
motion for summary judgment and granting plaintiffs' motion for
summary judgment as to plaintiffs' usury and usury-based claims.
The district court did not reach any determination regarding
monetary relief.
On Aug. 23, 2006, the district court issued an order granting
the company's motion to certify an issue for interlocutory
appeal to the U.S. Court of Appeals for the 9th Circuit.
On Aug. 30, 2006, the district court also issued an order
continuing the trial date in this matter from Oct. 3, 2006 to
Dec. 12, 2006.
On Oct. 16, 2006, the 9th Circuit granted the company's petition
for an interlocutory appeal of the district court's summary
judgment ruling in favor of plaintiffs and set a briefing
schedule for the appeal that contemplates that briefing will be
completed in March 2007.
On Dec. 21, 2006, the company entered into an initial agreement
with the representative plaintiffs to settle this litigation on
behalf of a settlement class.
On March 6, 2007, the Company entered into a formal agreement
with the representative plaintiffs acting on behalf of a
Settlement Class to settle this litigation.
On Aug. 23, 2007, the District Court issued an order granting
formal approval of the settlement and it became final on Sept.
24, 2007 after no appeal was taken.
The Aug. 23, 2007 order gave effect to the settlement, including
granting the Company full and final releases from the Settlement
Class, vacating the District Court’s earlier order granting
summary judgment against the Company, and dismissing the
California litigation with prejudice.
However, the District Court specifically reserved ruling on the
request of class counsel for payment of attorneys’ fees and
class representative fees. The Company does not know when the
District Court is likely to rule on this request.
Settlement Terms
Under the settlement, the “Settlement Class” is defined to
include:
-- all California merchants that, during the period of
May 25, 2000 through Dec. 31, 2004 participated in the
Company’s dining credits program and received a cash
advance during that period from the Company pursuant
to the pre-October 2004 versions of the Company’s same
contracts, and
-- any person who from May 25, 2000 to Dec. 31, 2004,
guaranteed the merchant’s obligations under the
relevant contracts.
The suit is “Bistro Executive Inc., et al. v. Rewards Network
Inc., et al., Case No. 2:04-cv-04640-CBM-Mc,” filed in the U.S.
District Court for the Central District of California under
Judge Consuelo B. Marshall with referral to Judge James W.
McMahon.
Representing the plaintiffs are:
John S. Purcell, Esq.
Kenneth R. Chiate, Esq.
Daniel L. Brockett, Esq.
James E. Doroshow, Esq.
Chandra L. Gooding, Esq.
Quinn Emanuel Urquhart Oliver & Hedges
865 S. Figueroa St., 10th Fl.
Los Angeles, CA 90017-2543
Phone: 213-624-7707 and 213-443-3000
Fax: 213-624-0643 and 213-443-3100
E-mail: danbrockett@quinnemanuel.com
- and -
Anat Levy, Esq.
Anat Levy and Associates
8840 Wilshire Boulevard, Third Floor
Beverly Hills, CA 90211
Phone: 310-358-3138
E-mail: alevy96@aol.com
Representing the defendants are:
Scott M. Pearson, Esq.
Daniel A. Rozansky, Esq.
Julia B. Strickland, Esq.
Stroock Stroock & Lavan
2029 Century Park E, 18th Fl.
Los Angeles, CA 90067-3086
Phone: 310-556-5800
Fax: 310-556-5959
E-mail: lacalendar@stroock.com
SEMCO ENERGY: Mich. Court OKs Settlement of Shareholder Lawsuit
---------------------------------------------------------------
The Michigan Circuit Court of the County of St. Clair approved a
settlement reached in a purported shareholder class action filed
against SEMCO Energy, Inc., each of its directors, and Cap Rock
Holding Corp.
On April 16, 2007, a purported shareholder class action lawsuit,
captioned, “Advantage Investors v. John T. Ferris et al.,” was
filed.
The complaint alleged, among other things, that the Directors
were self-interested and breached their fiduciary duties to the
shareholders of the Company in approving the Share Exchange. It
also alleged that Cap Rock had aided the alleged breaches of
fiduciary duty by the Directors.
The suit sought a declaration that the action was properly
maintainable as a class action and that the plaintiff was the
proper class representative, a declaration that the defendants
had breached their fiduciary duties or aided such breaches, and
compensatory and/or rescissory damages, reasonable costs and
attorneys’ fees and other remedies.
This lawsuit was settled, subject to Court approval of the
settlement and the completion of various procedural steps (such
as notifying shareholders of the settlement and their rights).
For its part, the Company agreed to make, and subsequently made,
certain additional disclosures in the proxy solicitation
materials sent to shareholders in connection with the special
meeting to consider the Share Exchange.
On Oct. 1, 2007, the Court approved the settlement. The
settlement binds a class consisting of essentially all holders
of the Company’s Common Stock on Feb. 23, 2007, and their
successors and transferees through the closing of the Share
Exchange.
SEMCO Energy, Inc. -- http://www.semcoenergy.com/-- distributes
natural gas to more than 400,000 customers combined in Michigan,
as SEMCO Energy Gas Co., and in Alaska, as ENSTAR Natural Gas
Company. It also owns and operates businesses involved in
propane distribution, intrastate pipelines and natural gas
storage in various regions of the U.S.
UNIVERSAL HEALTH: Settles Calif. Labor Litigation for $10.4M
------------------------------------------------------------
Universal Health Services, Inc. and some of its subsidiaries
settled for $10.4 million a purported class action filed in Los
Angeles Superior Court that is alleging violations of various
California Labor Code sections and applicable wage orders.
On Nov. 1, 2005, the company's management company and several of
its facilities located in California, including Inland Valley
Medical Center, Rancho Springs Medical Center, Del Amo Hospital
and Corona Regional Medical Center were named defendants in a
wage and hour suit, “Lasko-Hoellinger, et al v. UHS of Delaware,
Inc., et al.”
While two of the four original plaintiffs in that case
voluntarily requested that they be dismissed as plaintiffs from
the lawsuit, the remaining two plaintiffs are seeking to have
the matter certified as a class action.
The remaining plaintiffs are alleging, among other things, that
they are entitled to recover damages from the Hospitals for
missed breaks and other alleged violations of various California
Labor Code sections and applicable wage orders for a period of
at least one year prior to the filing of the case.
During 2006, the company recorded an estimated $10 million pre-
tax provision in connection with this and another related matter
($2 million during the first quarter of 2006 and $8 million
during the fourth quarter of 2006).
During the third quarter of 2007, this case and the related
matter were settled for a combined total of $10.4 million,
according to the company's Nov. 8, 2007 Form 10-Q Filing with
the U.S. Securities and Exchange Commission for the quarterly
period ended Sept. 30, 2007.
Universal Health Services, Inc. -- http://www.uhsinc.com/-- is
engaged in owning and operating, through its subsidiaries,
acute-care hospitals, behavioral health centers, surgical
hospitals, ambulatory surgery centers and radiation oncology
centers.
VALUECLICK INC: Faces Multiple Securities Fraud Suits in Calif.
---------------------------------------------------------------
ValueClick, Inc. faces several purported securities fraud class
actions in the U.S. District Court for the Central District of
California.
On Aug. 17, 2007, a purported securities fraud class action was
filed by Carl Waldrep, on behalf of himself and all others
similarly situated, presuming to represent all persons who
purchased or otherwise acquired the common stock of ValueClick,
Inc. between Nov. 1, 2006 and July 27, 2007.
The lawsuit alleges violations of certain federal securities
laws and is brought against the Company, its Executive Chairman
and its Chief Administrative Officer.
Since Aug. 17, 2007 and through the date of this filing, other
purported plaintiffs have filed similar actions, according to
the company's Nov. 8, 2007 Form 10-Q Filing with the U.S.
Securities and Exchange Commission for the quarterly period
ended Sept. 30, 2007.
The suit is “Carl Waldrep, et al. v. ValueClick, Inc., et al.,
Case No. 2:2007cv05411,” filed in the U.S. District Court for
the Central District of California under Judge Dean D.
Pregerson.
Representing the plaintiffs are:
Daniel E. Bacine, Esq.
Barrack Rodos and Bacine
3300 Two Commerce Square, 2001 Market Street
Philadelphia, PA 19103
Phone: 215-963-0600
E-mail: dbacine@barrack.com
- and -
Spencer A. Burkholz, Esq.
Coughlin Stoia Geller Rudman & Robbins LLP
655 West Broadway, Suite 1900
San Diego, CA 92101
Phone: 619-231-1058
Fax: 619-231-7423
VISTEON CORP: Dismissal of Mich. Securities Fraud Suit Appealed
---------------------------------------------------------------
Plaintiffs in a securities fraud suit filed against Visteon
Corp. have appealed a ruling of the U.S. District Court for the
Eastern District of Michigan dismissing an amended complaint.
The Van Buren Township, Michigan-based company is a leading
global supplier of automotive systems, modules and components to
global vehicle manufacturers and the automotive aftermarket.
In February 2005, a shareholder lawsuit was filed in the U.S.
District Court for the Eastern District of Michigan against it
and certain of its current and former officers.
In July 2005, the Public Employees' Retirement System of
Mississippi was appointed as lead plaintiff in this matter. In
September 2005, the lead plaintiff filed an amended complaint,
which alleges, among other things, that the company and its
independent registered public accounting firm,
PricewaterhouseCoopers LLP, made misleading statements of
material fact or omitted to state material facts necessary in
order to make the statements made, in light of the circumstances
under which they were made, not misleading.
The named plaintiff seeks to represent a class consisting of
purchasers of the company's securities during the period between
June 28, 2000 and Jan. 31, 2005. Class action status has not
yet been certified in this litigation.
On Aug. 31, 2006, the defendants motion to dismiss the amended
complaint for failure to state a claim was granted. The
plaintiffs have appealed this decision.
The company reported no development in the matter in its Nov. 8,
2007 Form 10-Q Filing with the U.S. Securities and Exchange
Commission for the quarterly period ended Sept. 30, 2007.
The suit is “Ley v. Visteon Corp., et al., Case No. 2:05-cc-
70737-RHC-VMM,” filed in the U.S. District Court for the Eastern
District of Michigan under Robert H. Cleland with referral to
Judge Virginia M. Morgan.
Representing the plaintiffs are:
E. Powell Miller, Esq.
Marc L. Newman, Esq.
Miller Shea (Rochester)
950 W. University Drive Suite 300
Rochester, MI 48307
Phone: 248-841-2200
E-mail: emiller335@aol.com
Representing the defendants are:
Michael A. Duffy, Esq.
Kirkland & Ellis
200 E. Randolph Drive, Suite 6000
Chicago, IL 60601
Phone: 312-861-2000
Fax: 312-861-2200
E-mail: maduffy@kirkland.com
Jenice C. Mitchell, Esq.
Foley & Lardner
500 Woodward Avenue, Suite 2700
Detroit, MI 48226-3489
Phone: 313-234-7100
E-mail: jmitchell@foley.com
- and -
Thomas P. Bruetsch, Esq.
Bodman (Troy)
201 W. Big Beaver Road, Suite 500
Troy, MI 48084
Phone: 248-743-6000
E-mail: tbruetsch@bodmanllp.com
VISTEON CORP: Mich. Court Dismisses Certain Claims in ERISA Case
----------------------------------------------------------------
The U.S. District Court for the Eastern District of Michigan
partially dismissed a purported class action filed against
Visteon Corp. and Ford Motor Co. over alleged violations of the
Employee Retirement Income Security Act.
In June 2006, the company and Ford Motor Co. were named as
defendants in a purported class action brought under ERISA in
the U.S. District Court for the Eastern District of Michigan on
behalf of certain former salaried employees of the company
associated with two plants located in Michigan.
The complaint alleges that the company and Ford violated their
fiduciary duties under ERISA when they established and spun off
the company and allocated certain pension liabilities between
them, and later when they transferred the subject employees to
Ford as new hires in 2006 after Ford acquired the plants.
In August 2006, the company and Ford moved to dismiss the
complaint for failure to state a claim.
In July 2007, the motion to dismiss the complaint filed on
behalf of the Company and Ford was granted in part and denied in
part.
Six of the seven named plaintiffs in this action have agreed to
release their claims by agreements entered into with Ford.
As a result, in September of 2007 the court entered a Rule 26(f)
Report reflecting the remaining plaintiff’s agreement to amend
the complaint by the end of November 2007 to withdraw the class
action allegation with prejudice and to add the names of any
other similarly situated employees that will join the action as
named plaintiffs.
Further, in September of 2007 the court entered a Stipulated
Order of Partial Dismissal dismissing, without prejudice, all of
the claims against Visteon brought on behalf of all of the named
plaintiffs who have entered into the release agreements referred
to above.
The suit is “Mark Ensley et al. v. Ford Motor Co. et al., Case
No. 2:06-cv-12845-AJT-SDP,” filed in the U.S. District Court for
the Eastern District of Michigan under Judge Arthur J. Tarnow
with referral to Judge Steven D. Pepe.
Representing the plaintiffs are:
Cary S. McGehee, Esq.
Robert W. Palmer, Esq.
Michael L. Pitt, Esq.
Peggy G. Pitt, Esq.
Pitt, Dowty
117 W. Fourth Street, Suite 200
Royal Oak, MI 48067-3804
Phone: 248-398-9800
E-mail: cmcgehee@pdmmp.com
rpalmer@pdmmp.com
attorneypitt@aol.com
VWA ASSET: Workers File FLSA Violations Lawsuit in California
-------------------------------------------------------------
On December 3, 2007, Sales Service Support Representatives filed
a putative collective action and class action overtime lawsuit
against VWA Asset Management, Inc., and Vengroff, Williams &
Associates, Inc., in the United States District Court for the
Northern District of California.
The lawsuit alleges that VWA violated the federal Fair Labor
Standards Act (FLSA) by misclassifying Sales Service Support
Representatives as exempt from the FLSA and corresponding
California wage and hour laws.
The lawsuit was brought by three Sales Service Support
Representatives who worked for VWA at Cisco Systems, Inc. in
California. They brought the action as a collective action and a
class action on behalf of themselves and others similarly
situated in the State of California.
Plaintiffs' attorney Paul Lukas explained, "VWA misrepresented
that Sales Service Support Representatives were exempt employees
that should be paid on a salary basis. In reality, the Sales
Service Support Representatives performed non-exempt work. As a
result, Sales Service Support Representatives were wrongfully
denied overtime pay for the overtime hours they worked."
Plaintiffs are represented by Donald Nichols, Paul Lukas and
Matthew Helland from the law firm of Nichols Kaster & Anderson.
Nichols, Kaster & Anderson has offices in Minneapolis, Minnesota
and San Francisco, California.
The case is entitled "Suh et al. v. VWA Asset Management, Inc.
et al, Civ. No. 07-6123," N.D. California.
Individuals may find information about joining this action at
www.nka.com and www.overtimecases.com or by calling (877) 448-
0492.
For more information, contact:
Paul Lukas
Phone: (612) 256-3200
Matt Helland
Phone: (415) 277-7235
WARNER-LAMBERT: Pa. Court Certifies Class in Neurontin Lawsuit
--------------------------------------------------------------
The Court of Common Pleas of Philadelphia County, Pennsylvania
granted class-action status to the lawsuit, “Clark v. Pfizer No.
1819 June Term 2004,” which names Warner-Lambert, LLC, as a
defendant.
Plaintiffs claim that they fraudulently promoted Neurontin's use
to treat conditions not approved by the U.S. Food and Drug
Administration. They claim that there was, and is, no
scientifically adequate proof that Neurontin or gabapentin can
effectively treat these unapproved conditions.
Named as defendants in the matter are Warner-Lambert, LLC, and
Pfizer, Inc.
The suit seeks a refund of all money paid by those who purchased
Neurontin or gabapentin for these unapproved uses.
In granting class-action status to the case, the court certified
as class members all persons who purchased Neurontin, or its
generic equivalent, gabapentin, in the Commonwealth of
Pennsylvania from 1995 to the present, for personal, family, or
household purposes for the treatment of conditions other than:
-- Adjunctive treatment of partial seizures associated
with epilepsy, or
-- The management of post-herpetic neuralgia (nerve pain
associated with “shingles”).
The certified class only includes people who were Pennsylvania
residents as of Nov. 1, 2007.
For more details, contact:
Sacks & Weston
Pennsylvania Neurontin Class Action
114 Old York Road
Jenkintown, PA 19046
Phone: 215-925-8200
Web site: http://www.paneurontinclassaction.com/
XYBERNAUT CORP: Feb. Hearing Set for $6M Securities Suit Deal
-------------------------------------------------------------
The U.S. District Court for the Eastern District of Virginia
will hold a final fairness hearing on Feb. 20, 2008 at 10:00
a.m. for the $6,300,000 settlement of the consolidated
securities class action, “In re: Xybernaut Corp. Securities MDL
Litigation, Case No. 1:05-MDL-1705 (LMB/TCB).”
The hearing will be held before Judge Albert V. Bryan, in the
U.S. Courthouse, 401 Courthouse Sq., Alexandria, VA 22314.
Deadline for the submission of a proof of claim is on Sept. 3,
2007.
Case Background
During March 2005, Xybernaut announced that it would be unable
to file its 2004 annual report and announced that it had
discovered material weaknesses in its internal controls with
regards to expense reimbursement, revenue recognition, and
monitoring business risks.
In April 2005, Xybernaut announced the conclusions of an
internal investigation. Xybernaut also announced that Grant
Thornton had resigned as auditor, Edward G Newman and Steven A
Newman, along with certain other employees were asked to leave
the company, and the U.S. Attorney’s Office was investigating
the company.In May 2005, NASDAQ delisted Xybernaut. In July
2005, Xybernaut filed a bankruptcy petition.
The Complaint alleges that one or more of the Original
Defendants:
-- failed to disclose rampant nepotism within the company;
-- failed to disclose use of Company funds for personal
expenses;
-- issued false and misleading statements concerning
Xybernaut’s business and prospects; and/or
-- misled investors about fund raising through private
placements of Xybernaut stock.
Defendants deny and continue to deny that they have committed
any act or omission giving rise to any liability or violation of
law.
For more details, contact:
Xybernaut Securities Litigation Settlement
c/o Analytics Incorporated, Claims Administrator
P.O. Box 2007
Chanhassen, MN 55317-2007
Phone: 1-888-633-9346
Web site: http://www.xybernautsettlement.com/
New Securities Fraud Cases
MEDTRONIC INC: Schiffrin Barroway Files Securities Fraud Suit
-------------------------------------------------------------
The law firm of Schiffrin Barroway Topaz & Kessler, LLP filed a
class action in the United States District Court for the
District of Minnesota on behalf of all purchasers of securities
of Medtronic, Inc. from June 25, 2007 through October 15, 2007,
inclusive.
The Complaint charges Medtronic and certain of its officers and
directors with violations of the Securities Exchange Act of
1934.
Medtronic is engaged in the medical technology business.
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 Company had received a substantial and
increased number of reports of death and serious
injuries caused by fractures in its Sprint Fidelis
defibrillator leads;
(2) that the Company had failed to suspend distribution of
its Sprint Fidelis defibrillator leads in the face of
such mounting safety concerns;
(3) that the Company, as such safety concerns were
revealed, would be forced to suspend distribution of
its Sprint Fidelis defibrillator leads;
(4) that the FDA would consider this "removal action" to be
a "medical device recall";
(5) that this medical device recall would have a
significant financial impact on the Company's financial
statements in subsequent quarters;
(6) that the Company lacked adequate internal and financial
controls; and
(7) that, as a result of the foregoing, the Company's
statements about its financial well-being and future
business prospects were lacking in any reasonable basis
when made.
On October 15, 2007, the Company shocked investors when it
disclosed that it had received a significant, and an increased,
number of adverse reports about the Company's Sprint Fidelis
defibrillator leads, which were attributable to manufacturing
defects and resulted in significant safety concerns.
The Company admitted that it had identified hundreds of
malfunctions, serious injuries, and five patient deaths where a
Sprint Fidelis lead fracture "may have been a possible or likely
contributing factor."
Additionally, the Company reported that it had suspended the
distribution of its Sprint Fidelis leads, and instructed
physicians to stop implanting the leads and return all unused
products. Subsequently, the Food and Drug Administration ("FDA")
issued a notice stating that it considered such a product
"removal action" to be a "medical device recall," which the FDA
terms as "an action taken when a medical device is defective,
when it could be a risk to health, or when it is both defective
and a risk to health."
On this news, the Company's shares declined $6.33 per share, or
11.2 percent, to close on October 15, 2007 at $50.00 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 January 7,
2008 for lead plaintiff appointment.
For more information, contact:
Darren J. Check, Esq.
Richard A. Maniskas, Esq.
Schiffrin Barroway Topaz & Kessler, LLP
280 King of Prussia Road
Radnor, PA 19087
Phone: 1-888-299-7706 (toll free) or 1-610-667-7706
E-mail: info@sbtklaw.com
SYNTAX-BRILLIAN: Zwerling Schachter Files Securities Fraud Suit
---------------------------------------------------------------
Zwerling, Schachter & Zwerling, LLP has filed a class action in
the United States District Court for District of Arizona on
behalf of all persons and entities who purchased the common
stock of Syntax-Brillian Corp. during the period from February
9, 2007 through November 14, 2007.
The complaint alleges that defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. Specifically, the complaint alleges that
throughout the Class Period defendants issued numerous
materially false and misleading statements concerning Syntax-
Brillian's revenue growth, profitability, and its business in
China.
On September 12, 2007, in sharp contrast to the numerous
positive statements issued throughout the Class Period, Syntax-
Brillian announced that the results for its first quarter 2008,
ending on September 30, 2007, would be significantly below
expectations. The Company projected first quarter 2008 revenues
of between $170-180 million, when analysts were expecting the
Company to report revenues of $254 million, a shortfall of more
than 25%. On November 11, 2007, the Company announced that
revenues for the quarter ended September 30, 2007, were $150.6
million, a decline of 26.6% from the previous quarter, and that
revenue from China in the quarter was $14.6 million, compared
with $96.8 million in the prior quarter, a decline of
approximately 85%.
The complaint alleges that Syntax-Brillian failed to disclose
that while the Company shipped hundreds of thousands of LCD
televisions to its sole distributor in China during the Class
Period, and recorded hundreds of millions of dollars in revenue
in connection with these shipments, the end-user demand for the
Company's LCD televisions in China did not support the level of
shipments made by the Company, thereby overstating its revenues.
The Complaint further alleges that defendants engaged in this
scheme, in part, to complete a public offering of approximately
25.6 million shares of its common stock at $5.75 per share on
May 23, 2007.
Interested parties may move the court no later than January 15,
2008 for lead plaintiff appointment.
For more information, contact:
Kevin McGee, Esq.
Don Lanier
Zwerling Schachter
Phone: 1-800-721-3900 or
E-mail: kmcgee@zsz.com or dlanier@zsz.com
VERIFONE HOLDINGS: Kaplan Fox Files Securities Suit in Calif.
-------------------------------------------------------------
Kaplan Fox & Kilsheimer LLP has filed a class action in the
United States District Court for the Northern District of
California against VeriFone Holdings, Inc. and certain of its
officers on behalf of all persons who purchased the publicly
traded securities of VeriFone between March 1, 2007 through
November 30, 2007.
The Complaint alleges that defendants violated the federal
securities laws by publicly disseminating materially false and
misleading financial results for VeriFone's first three fiscal
quarters of 2007.
Specifically, the Complaint alleges that, with regard to these
three quarters, Defendants:
(1) materially overstated VeriFone's earnings and
inventory;
(2) falsely represented that they were prepared in
accordance with Generally Accepted Accounting
Principles ("GAAP"); and
(3) falsely represented that VeriFone had adequate internal
financial and disclosure controls.
During the same period, VeriFone's Chairman and Chief Executive
Officer, defendant Douglas G. Bergeron, sold approximately
1,028,822 VeriFone shares at artificially inflated prices for
proceeds of approximately $41.5 million, and VeriFone's
Executive Vice President and Chief Financial Officer, defendant
Barry Zwarenstein, sold 118,585 VeriFone shares at artificially
inflated prices for proceeds of approximately $4.6 million.
On December 3, 2007, VeriFone announced that it was restating
its financial statements for the first three fiscal quarters of
2007, and that its financial results for those three quarters
could no longer be relied upon. In reaction to this news, it is
alleged that VeriFone's share price fell by 45% -- or $22 per
share -- on exceptional trading volume.
Interested parties may move the court no later than February 4,
2008 for lead plaintiff appointment.
For more information, contact:
Frederic S. Fox
Joel B. Strauss
Donald R. Hall
Jeffrey P. Campisi
Kaplan Fox & Kilsheimer LLP
850 Third Avenue, 14th Floor
New York, New York 10022
Phone: (800) 290-1952 or (212) 687-1980
Fax: (212) 687-7714
E-mail address: mail@kaplanfox.com
- and -
Laurence D. King
Kaplan Fox & Kilsheimer LLP
350 Sansome Street, Suite 400
San Francisco, California 94104
Phone: (415) 772-4700
Fax: (415) 772-4707
E-mail address: mail@kaplanfox.com
ZUMIEZ INC: Schiffrin Barroway Files Wash. Securities Fraud Suit
----------------------------------------------------------------
The law firm of Schiffrin Barroway Topaz & Kessler, LLP filed a
class action in the United States District Court for the Western
District of Washington on behalf of all purchasers of securities
of Zumiez Inc. from March 14, 2007 through November 7, 2007,
inclusive.
The Complaint charges Zumiez and certain of its officers and
directors with violations of the Securities Exchange Act of
1934.
Zumiez is a mall-based specialty retailer of action sports
related apparel, footwear, equipment and accessories operating
under the Zumiez brand name.
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 sales of Zumiez's winter merchandise had slowed
dramatically, to the point that they were far below
internal expectations;
(2) that as a result of this, the Company's retail stores
did not meet sales expectations and same store sales
suffered;
(3) that the Company lacked adequate internal and financial
controls; and
(4) that, as a result of the foregoing, the Company's
statements about its financial well-being and future
business prospects were lacking in any reasonable basis
when made.
On November 7, 2007, the Company shocked investors when it
announced its October 2007 sales results. The Company announced
that its comparable store sales had only increased by 5.1% for
the four-week period (ended November 3, 2007), against a
comparable store sales increase of 15.9% for the year ago
period. Additionally, the Company announced disappointing
preliminary third quarter 2007 results of between $0.27 - $0.28
earnings per share ("EPS"), and that it was now "taking a more
conservative outlook for the remainder of fiscal 2007 due to the
reliance on seasonal merchandise in the fourth quarter." As a
result, the Company significantly reduced its full year fiscal
2007 EPS outlook, from a previous range of between $0.97 - $0.99
EPS down to between $0.92 - $0.94 EPS for the year.
On this news, the Company's shares fell $10.71 per share, or
over 27 percent, to close on November 8, 2007 at $28.74 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 February 11,
2007 for lead plaintiff appointment.
For more information, contact:
Darren J. Check, Esq.
Richard A. Maniskas, Esq.
Schiffrin Barroway Topaz & Kessler, LLP
280 King of Prussia Road
Radnor, PA 19087
Phone: 1-888-299-7706 (toll free) or 1-610-667-7706
*********
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
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USA. Glenn Ruel Senorin, Ma. Cristina Canson, and Janice
Mendoza, Editors.
Copyright 2007. All rights reserved. ISSN 1525-2272.
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