C L A S S A C T I O N R E P O R T E R Friday, February 8, 2008, Vol. 10, No. 28 Headlines AMERICAN CORRECTIVE: Ninth Circuit Allows Calif. Suit to Proceed AWP LITIGATION: Court Rejects First DataBank Suit Settlements COUNTRYWIDE FINANCIAL: CA Couples Sue Over Inflated Home Prices COUNTRYWIDE HOME: Calif. Suit Protests Sale to Bank of America FIRST MAGNUS: Judge Mulls Firm's Liability in Employee Lawsuit GLOBETEL COMMS: Fla. Court Gives Final OK to $2.3M Settlement GOLDMAN SACHS: Reaches $11.5M Settlement in UC Enron Litigation MCKESSON CORP: Seeks Dismissal of RICO Claims in Mass. Lawsuit MCKESSON CORP: Wants "Related" Antitrust Suit in Mass. Dismissed MEAT PACKERS: Appeals Court Reverses $9.3M Ruling in Cattle Case MICHIGAN: Court-Appointed Experts Cite Problems in Foster Care OWN MY TRAVEL: Suit on Behalf of Pyramid Scheme Investors Looms PACIFIC CYCLE: Recalls Trailer Bikes Posing Injuries to Children PILGRIM'S PRIDE: Fifth Circuit Denies Appeal in "Wheeler" Case POTTERY BARN: Recalls Decorative Candles Due to Fire Hazard RADIATION THERAPY: Settles Suits Over RTS Merger Agreement SEVENTY TWO INC: Recalls Hoodies Due to Strangulation Hazard SOMA FINANCIAL: Faces Calif. Suit Over PayOption Sale Omissions TRUCKEE CARSON: Two Flood-Related Suits Moved to Federal Court UNITED STATES: Says Vets Not Entitled to Specific Medical Care VALUECLICK: Ohio Resident Sues Over "Free" Merchandise Promises VISA INC: Added as Defendant in Calif. "Attridge" Litigation VISA INC: N.Y. Court Dismisses Claims for Damages in MDL-1720 VISA USA: Ninth Circuit Mulls Appeal Over "Kendall" Suit Nixing VISA USA: Mounts Successful Defense V. Multiple Consumer Suits VISA USA: Parties in Calif. Lawsuit Engage in Settlement Talks VISA USA: Faces Litigation in Maryland Over Credit Card Fees WACHOVIA CORP: Faces Penna. Lawsuit Alleging Telemarketing Fraud WEST PUBLISHING: New Antitrust Lawsuit Filed in California YAHOO INC: Faces Calif. Suit Over Microsoft's $45BB Buyout Offer Asbestos Alerts ASBESTOS LITIGATION: H.B. Fuller Settles Six Lawsuits for $405T ASBESTOS LITIGATION: Appeal to FELA Suit v. Ill. Railroad Upheld ASBESTOS LITIGATION: Owens-Illinois Liabilities Rise to $245.5M ASBESTOS LITIGATION: Appeals Court Favors Warden in Purser Case ASBESTOS LITIGATION: Supreme Court Refuses Appeal in McCord Suit ASBESTOS LITIGATION: Cascino Vaughan Represents USG's Creditors ASBESTOS LITIGATION: SimmonsCooper Files 4 Out-of-State Lawsuits ASBESTOS LITIGATION: Oregon DEQ Imposes $6,358 Penalty to Local ASBESTOS LITIGATION: Studio Worker's Widow Gets GBP210T Payout ASBESTOS LITIGATION: Md. Court Orders John Crane to Pay $15.3M ASBESTOS LITIGATION: Inquest Links Painter's Death to Asbestos ASBESTOS LITIGATION: Inquest Links U.K. Worker's Death to Hazard ASBESTOS LITIGATION: Inquest Links Hazard to Yard Worker's Death ASBESTOS LITIGATION: Sacramento Survey Finds Asbestos in Schools ASBESTOS LITIGATION: Contractors Indicted in Gordon-Smith Action ASBESTOS LITIGATION: W.Va. Contractor Faces Disposal Breach Suit ASBESTOS LITIGATION: New Ontario Laws May Affect Asbestos Claims ASBESTOS LITIGATION: Wear Valley Council Faces Asbestos Breaches ASBESTOS LITIGATION: HSE to Hold 11th Asbestos Summit on Feb. 13 ASBESTOS LITIGATION: Cleanup of Metro-North Hudson Line Ongoing ASBESTOS LITIGATION: P&G Co. Says Fla. Plant Workers Not Exposed ASBESTOS LITIGATION: General Motors Starts Cleanup of Wyo. Plant ASBESTOS LITIGATION: No Safe Asbestos Levels, Aussie Group Says ASBESTOS LITIGATION: Appeals Court Upholds Rulings in Brown Suit ASBESTOS LITIGATION: Folksamerica Records $63M for A&E Reserves ASBESTOS LITIGATION: Unitrin Has A&E Reserves of $18M at Dec. 31 ASBESTOS LITIGATION: Sensus Metering Still Faces Exposure Suits ASBESTOS LITIGATION: RBS Records $136M Claims Reserve at Dec. 29 ASBESTOS LITIGATION: Grace Parties File Briefs on Admissibility ASBESTOS LITIGATION: Labor Unions, NGOs Demanding Ban in India ASBESTOS LITIGATION: Scapa Dryers, Wallace & Gale Liable in Suit ASBESTOS LITIGATION: Lacone's Family Gives AUD200T for Research ASBESTOS LITIGATION: Asymptomatic Claimants Laud Scottish Bill ASBESTOS LITIGATION: Court Junks Pending Motions in Grace Action ASBESTOS LITIGATION: Tyco Int'l Has 5,600 Cases Recorded at Dec. ASBESTOS LITIGATION: RBS Global Inc. Records 675 Stearns Actions ASBESTOS LITIGATION: RBS Global Records 2 Prager Injury Lawsuits ASBESTOS LITIGATION: RBS Global Inc. Records 130 Falk Lawsuits ASBESTOS LITIGATION: RBS Faces About 7,800 Zurn Cases at Dec. 29 ASBESTOS LITIGATION: Court Junks Dismissal of Anderson's Action ASBESTOS LITIGATION: Magnetek Receives $1.4M Payment from Trust ASBESTOS LITIGATION: Del. Court Junks Claims Against Contractors ASBESTOS LITIGATION: Canadian Study Says 300 Workers Die Yearly ASBESTOS LITIGATION: UCATT OKs U.K. Gov't. Admission on Asbestos ASBESTOS LITIGATION: Wis. Officials Urging to Hasten Demolitions ASBESTOS LITIGATION: Cleanup at ABB's Site in Australia Ongoing ASBESTOS ALERT: Equitable Developer Could Face Asbestos Penalty New Securities Fraud Cases CELLCYTE GENETICS: Hagens Berman Files WA Securities Fraud Suit HUNTINGTON BANCSHARES: Strauss & Troy Files OH Securities Suit MAXIM INTEGRATED: Rosen Law Firm Files Ca. Securities Fraud Suit ********* AMERICAN CORRECTIVE: Ninth Circuit Allows Calif. Suit to Proceed ---------------------------------------------------------------- The U.S. Court of Appeals for Ninth Circuit has ruled that American Corrective Counseling Services, Inc., a private debt collection company used by several counties to collect on bouncing checks, can be sued for its allegedly overaggressive tactics, Howard Mintz of Mercury News reports. A unanimous three-judge panel found that ACCS is not entitled to government immunity against lawsuits, even if it was hired by local district attorneys to track down thousands of bad check writers each year. Mercury News reports that the company had been attempting to extricate itself from a class action filed with the U.S. District Court for the Northern District of California back in Dec. 11, 2001. That lawsuit, entitled, "Elena Del Campo v. American Corrective Counseling, Case No. 5:01-cv-21151-JW," generally accuses company officials of intimidating people with the phony threat of jail, and charging them exorbitant fees to clear their debts. According to court records, plaintiffs in the case, who are being backed by the Washington, D.C.-based consumer watchdog group Public Citizen, include: -- Elena M. Del Campo; -- Miriam Campos; -- Lisa Johnston; -- Ashorina Medina; and -- Lois Artz. Additionally, court records revealed that besides ACCS, there are also other defendants named in the case. These defendants are: -- Don R. Mealing; -- Bruce D. Raye; -- Fulfillment Unlimited, Inc.; -- Fundamental Performance Strategies; -- Inc. Fundamentals; -- ACCS Administration, Inc.; -- R.D Davis; -- Defendant Green; -- Defendant Kramer; and -- Defendant Lopez. With the Ninth Circuit's rejection of the company's immunity defense, the case can now proceed to a trial, according to the Mercury News report. However, Mercury News has learned that attorneys for ACCS, who expressed disappointment at the decision, may ask an 11-judge panel of the U.S. Court of Appeals for the Ninth Circuit to to reconsider the ruling. The suit is "Elena Del Campo v. American Corrective Counseling, Case No. 5:01-cv-21151-JW," filed with the U.S. District Court for the Northern District of California, Judge James Ware presiding. Representing the plaintiffs are: Paul Arons, Esq. Law Office of Paul Arons 685 Spring Street # 104 Friday Harbor, WA 98250 Phone: 360-378-6496 e-mail: lopa@rockisland.com - and - Deepak Gupta, Esq. Public Citizen Litigation Group 1600 20th Street, NW Washington, DC 20009 Phone: 202-588-1000 Web site: http://www.citizen.org/ Representing the defendants are: Shawn Marie Harpen, Esq. Jones Day 3 Park Plaza, Suite 1100 Irvine, CA 92614 Phone: 949-553-7518 Fax: 949-553-7539 e-mail: sharpen@jonesday.com - and - Timothy P. Irving, Esq. Ross, Dixon & Bell 550 West B Street, Suite 400 San Diego, CA 92101 Phone: 619-235-4040 Fax: 619-231-8796 e-mail: tirving@rdblaw.com AWP LITIGATION: Court Rejects First DataBank Suit Settlements ------------------------------------------------------------- The U.S. District Court for the District of Massachusetts entered a minute order denying final approval of the proposed settlements by First DataBank, Inc., and Medi-Span, Inc. in the class actions, "New England Carpenters Health Benefits Fund, et al. v. First Databank, Inc., et al., Case No. 1:05-cv-11148- PBS," and "D. C. 37 Health & Security Plan v. Medi-Span, No. 07- cv-10988-PBS." Case Background The two lawsuits were filed by the New England Carpenters Health Benefits Fund and the AFSCME District Council 27 Health and Security Plan, respectively. Both suits concern how the published price of drugs are determined, what consumers pay for the drugs and what third- party payors reimburse for them (Class Action Reporter, Sept. 26, 2007). In general, the suits allege that defendants conspired with drug wholesaler McKesson Corp. to manipulate the price of medicines to benefit that company's customers. McKesson Corp., which is not part of the settlement, previously issued a press statement, maintaining that it did not conspire with the defendants to raise the published average wholesale prices of drugs (Class Action Reporter, Oct. 11, 2006). First DataBank, Inc., and Medi-Span, Inc., publish data related to the prices of prescription drugs in their printed and electronic databases. The data includes the Average Wholesale Price of each drug. Pharmaceutical manufacturers report certain prices to FDB and Medi-Span. FDB then marked-up these prices to get the AWP reported in their publications and databases. From December 2001 into April 2004, Medi-Span published AWP that it obtained from FDB. Subsequently, Medi-Span independently published certain AWP information in its publications and databases. Third-party payors and pharmacies may use the AWP as a benchmark in determining the amount of reimbursement for drugs or the cost of drugs to certain consumers. One of the lawsuits alleges that FDB and McKesson wrongfully inflated the mark-up used to determine the AWP. The other lawsuit claims that Medi-Span negligently published inflated prescription drug prices. As a result, the two lawsuits claim that insurers, third-party Payors, and some consumers paid more for certain drugs than they should have. FDB/Medi-Span Settlement Both FDB and Medi-Span reached tentative settlements in their respective cases. The proposed settlement aimed to provide "injunctive relief," which technically means that instead of paying money damages, defendants agree to change what they are doing to benefit the class. In essence, FDB and Medi-Span will: -- reduce the mark-up factor for thousands of drugs in their respective data publications. -- cease to publish an AWP within two (FDB) or three (Medi- Span) years of the settlement's final approval. -- Provide information on drug price publishing in connection with this and other lawsuits. The class covered by the settlements consists of all individual persons or entities that made purchases and paid, whether directly, indirectly, or by reimbursement, for all or part of the purchase price of certain prescription pharmaceuticals based on the AWP data reported by FDB or Medi-Span. The court had set a final approval hearing on Jan. 22, 2008, wherein it would consider whether the proposed deals are fair, reasonable, and adequate. On Jan. 23, 2008, the trial court conducted a "fairness" hearing on the proposed settlement between the plaintiff classes and defendants FDB and Medi-Span, according to McKesson Corp.'s Feb. 1, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. A number of objections were filed against the proposed settlement by various retail chain and independent pharmacy groups. Thus, on Jan. 24, 2008, Judge Patti B. Saris entered a minute order denying approval of the settlement "without prejudice for reasons stated in court." The court has not yet issued an opinion reflecting in more detail the bases for Judge Saris' denial of the settlement. More information on the matter is available free of charge at: http://www.FDBMediSpanSettlement.com COUNTRYWIDE FINANCIAL: CA Couples Sue Over Inflated Home Prices --------------------------------------------------------------- Countrywide Financial Corp. and KB Home face a purported class action in California, which is claiming that the two schemed with real estate appraisers to inflate prices paid for homes as the housing market began to collapse in 2005, the Associated Press reports. The suit was filed with the Los Angeles Superior Court by two California couples on Feb. 6, 2008. It also names as defendants KB Home Mortgage Co., Countrywide Home Loans Inc., Countrywide KB Home Loans -- a joint venture of Countrywide and the builder -- and two real estate appraisers. The couples, all residents of Live Oak in Northern California, are: -- Deborah and Lonnie Bolden, and -- David and Dolores Contreras The suit alleges that prospective homebuyers were presented with false or misleading data on previously sold homes in order to justify higher asking prices on new purchases, according to AP. KB customers were presented with comparable sales data from homes that were dissimilar, nowhere near the KB property being sold, or from sales that had not yet closed, the lawsuit states. Furthermore, the suit alleges that when independent appraisers evaluated comparable home sales, the values were between 10 percent and 15 percent lower than the price the plaintiffs paid for their KB homes. The plaintiffs are seeking unspecified restitution as well as compensatory and punitive damages. In addition, they want class-action status to cover KB Home customers in California who obtained financing through Countrywide and closed on their purchases between Aug. 1, 2005 and July 31, 2006. The complaint, which was obtained by AP, suggests the alleged scheme likely affected other KB customers. Specifically, the complaint pointed out, "Inflated closed-sale prices resulting from the fraudulent appraisals, in turn, infected subsequent appraisals and valuations, allowing KB Home to continue to obfuscate falling values and obtain prices inflated well beyond where they would have been in the absence of this unlawful price manipulation." For more details, contact: Peter B. Fredman, Esq. Brayton Purcell LLP 222 Rush Landing Road P.O. Box 6169 Novato, CA 94948-6169 Phone: (415) 898-1555 Fax: (415) 898-1247 Web site: http://www.braytonlaw.com COUNTRYWIDE HOME: Calif. Suit Protests Sale to Bank of America -------------------------------------------------------------- Countrywide Home Loans shareholders have brought a class-action complaint with the Los Angeles Superior Court against Countrywide Home Loans CEO Angelo Mozilo and Bank of America, CourtHouse News Service reports. The suit claims that Mr. Mozilo is selling his beleaguered company too cheaply to BofA, on grossly unfair terms. The plaintiffs claim that BofA snapped up Countrywide at the "bargain basement price" of 0.1822 shares of BofA stock for each Countrywide share. They also assert that Countrywide directors harmed the company by their risky lending practices, while pumping up the stock through false and misleading statements and unjustly enriching themselves by dumping their own shares at inflated prices. According to the suit, Mr. Mozilo and "his cohorts" face "hundreds of millions, if not billions, of dollars of personal liability" from class-action and derivative lawsuits. They assert that these defendant-directors each profited certain amounts in millions of dollars by dumping shares before the misconduct became known: -- Mr. Mozilo, $450.5 million; -- Henry G. Cisneros, $5.6 million; -- Jeffrey M. Cunningham, $3 million; -- Robert J. Donato, $5.5 million; -- Oscar P. Robertson, $10.2 million; -- David Sambol, $57.8 million; and -- Harley W. Snyder, $9 million. In other words, the complaint states, the defendant-directors reaped more than $500 million in illicit gains, and when Countrywide's misconduct was revealed on July 24, 2007, and the share price fell by $3.56 that day, shareholders lost more than $2.1 billion. The plaintiffs want the terms of the sale rescinded, including any accompanying termination fees, and they want the defendants enjoined from consummating an acquisition tied to extracting indemnity agreements, unless and until the Company adopts and implements a fair procedure or process that does not unfairly advantage defendants at the expense of Countrywide shareholders. The plaintiffs also object to BofA's providing legal defense for Mr. Mozilo and the other individual defendants. The plaintiffs' counsel is: Coughlin Stoia Geller Rudman & Robbins LLP Web site: http://www.csgrr.com FIRST MAGNUS: Judge Mulls Firm's Liability in Employee Lawsuit -------------------------------------------------------------- U.S. Bankruptcy Judge James Marlar is determining whether First Magnus Financial Corp. is liable for not providing notice of a mass layoff, Christie Smythe writes for the Arizona Daily Star. According to Ms. Smythe, Judge Marlar seemed to be leaning toward dismissing the case and against awarding damages to the eight employees included in the lawsuit against the lender. As reported in the Class Action Reporter on Jan. 17, 2008, Judge Marlar denied the request of First Magnus employees to certify a lawsuit for unpaid wages and benefits. The lawsuit was initially filed as a potential class-action suit on behalf of all of First Magnus' roughly 5,500 employees nationwide, who were laid off on Aug. 16, 2007, when the company shut down its operations. The employees also have not received their final pay checks because First Magnus failed to pay them before filing for bankruptcy on Aug. 21. The suit -- which was also filed against First Magnus Capital Inc., a holding company formed by First Magnus executives and shareholders and has 100% ownership in the lender -- alleged that the employees are entitled to damages for First Magnus' failure to provide 60 days notice of a mass layoff, as required by the federal Worker Adjustment and Retraining Notification Act. In his order issued on Jan. 11, 2008, Judge Marlar denied certification of the suit as a class action, saying that "such an event would unnecessarily increase the costs and reduce the distribution to the proposed class members." The judge further wrote that the employees should simply file claims, "each of which will be addressed on its merits." The attorneys representing the employees, however, have filed an appeal of Judge Marlar's decision in federal court. Judge Marlar, according to Arizona Daily, admitted to having "real difficulty associating the facts of this case with the bankruptcy code." Rene Roupinian, Esq., cited numerous precedents in her arguments that First Magnus should be held liable for not notifying its workers, Arizona Daily notes. Judge Marlar said he would consider Ms. Roupinian's arguments, but is not interested in cases that might hold up First Magnus' bankruptcy proceedings and further delay employees getting their final checks. Arizona Daily cites Judge Marlar as saying that the employees were thrown out without pay and that he is trying to get them paid through the company's bankruptcy case. First Magnus Capital, the report recalls, earlier asked to be dismissed from the lawsuit on the grounds that it is not directly involved in the lender's bankruptcy case. Jan Saffer, Esq., who is representing First Magnus Capital, also said that the employees should simply be treated as creditors. The plaintiffs are represented by: Rene S. Roupinian, Esq. Outten & Golden, LLP e-mail: rroupinian@outtengolden.com Web site: http://www.masslayoff.com About First Magnus Based in Tucson, Arizona, First Magnus Financial Corporation -- http://www.firstmagnus.com/-- purchases and sells prime and Alt-A mortgage loans secured by one-to-four unit residences. The company filed for chapter 11 protection on Aug. 21, 2007 (Bankr. D. Ariz. Case No.: 07-01578). John R. Clemency, Esq., at Greenberg Traurig LLP, serves as the counsel for the Debtor. The Official Committee of Unsecured Creditors has selected the firm Warner Stevens LLP as its counsel. When the Debtor filed for bankruptcy, it listed total assets of $942,109,860 and total debts of $812,533,046. The Debtor's exclusive period to file a plan expired on Dec. 19, 2007. The confirmation hearing on the Debtor's liquidation plan is on Feb. 7, 2008. (First Magnus Bankruptcy News, Issue No. 16; Bankruptcy Creditors' Service Inc. http://bankrupt.com/newsstand/or 215/945-7000). GLOBETEL COMMS: Fla. Court Gives Final OK to $2.3M Settlement ------------------------------------------------------------- The U.S. District Court for the Southern District of Florida gave final approval to settlements reached in pending securities class action and a shareholder derivative action filed against GlobeTel Communications Corp., and certain of its current and former officers and directors. On April 28, 2006, the law firm of Sarraf Gentile, LLP, commenced a securities fraud class action on behalf of those investors who acquired the securities of GlobeTel Communications Corp. from Dec. 30, 2005 to April 11, 2006 (Class Action Reporter, Nov. 21, 2007). On Oct. 29, 2007, GlobeTel reached settlements in principle in pending securities class action as well as shareholder derivative litigation (Case Nos. 06-21071 and 06-60923, respectively) filed against certain of current and former officers and directors. The settlements were and preliminary approval announced on Nov. 20, 2007 Under the terms of the proposed settlement agreement in the class action, the Company's D&O insurance carrier will make a cash payment to the class of $2,300,000, less up to $100,000 for potential counsel fees and expenses. All claims in the class action will be dismissed with prejudice. Pursuant to the proposed settlement in the derivative action, the Company's D&O insurance carrier will pay $60,000 in attorneys' fees to plaintiff's counsel, the Company will implement or maintain certain corporate governance changes, and all claims will be dismissed with prejudice. As a result of these approvals, all claims in these two lawsuits have been fully settled and dismissed with prejudice by the court. The securities fraud suit is "Richard Stevens, et al. v. GlobeTel Communications Corp., et al., Case No. 06-CV-21071," filed with the U.S. District Court for the Southern District of Florida, Judge Cecilia M. Altonaga presiding. Representing the plaintiffs are: Glancy Binkow & Goldberg, LLP, (LA) 1801 Ave. of the Stars, Suite 311 Los Angeles, CA, 90067 Phone: (310) 201-915 Fax: (310) 201-916 e-mail: info@glancylaw.com Howard G. Smith Attorney at Law 3070 Bristol Pike, Suite 112 Bensalem, PA, 19020 Phone: (215) 638-4847 Fax: (215) 638-4867 Milberg Weiss Bershad & Schulman, LLP, (Boca Raton) The Plaza - 5355 Town Center Road, Suite 900 Boca Raton, FL, 33486 Phone: 561.361.5000 Fax: 561.367.8400 e-mail: info@milbergweiss.com - and - Sarraf Gentile, LLP 485 Seventh Avenue, Suite 1005 New York, NY, 10018 Phone: 212.868.3610 Fax: 212.918.7967 GOLDMAN SACHS: Reaches $11.5M Settlement in UC Enron Litigation --------------------------------------------------------------- The University of California and Goldman Sachs Group, Inc., have reached a $11.5-million settlement over investment losses from Enron Corp., Angelica Dongallo of The Daily Californian reports. The settlement with Goldman Sachs is the latest resolved case in the university's class action against Enron, which folded in 2001 after being found to have committed investor fraud. To date, approximately 500,000 plaintiffs in the lawsuit, led by UC, have received about $7.3 billion in settlements. The university alleged that prior to Enron's 2001 collapse, Goldman Sachs used a false registration statement to sell the 7% exchangeable notes issued to investors by Enron. The notes were exchangeable for stocks at Enron Oil & Gas Co., according to The Daily Californian report. As the lead plaintiff in the case, UC is seeking repayment for investments made with the company from banks, law firms, and individuals who were involved with the investments. The Daily Californian reports that the UC Board of Regents approved the Goldman Sachs settlement at their business meeting last month, but the decision must still be approved by the district court. Case Background The university's original suit was filed in October 2001. The case against Goldman Sachs began in 2004 when the investment firm was added as a defendant in the university's case against Enron. The suit was filed by Enron investors seeking to recover $40 billion in losses from the bankruptcy of the energy company. Enron filed for Chapter 11 bankruptcy on Dec. 2, 2001 (Class Action Reporter, March 22, 2007). In June 2006, Judge Melinda Harmon of the U.S. District Court for the Southern District of Texas, certified the lawsuit as a class action. On March 19, 2007, the U.S. Court of Appeals for the 5th Circuit ruled that the suit was improperly certified as a class action, and was thus sent back to the lower court for reconsideration. The shareholders then sought U.S. Supreme Court review of the ruling. In their Petition, the Plaintiffs asked the Supreme Court: does liability exist under Section 10(b) of the Securities Exchange Act of 1934 and the Securities and Exchange Commission Rule 10b 5, where an actor knowingly employs deceptive devices and contrivances as part of a scheme to defraud investors in another public company, but makes no affirmative misrepresentations to the market? The Plaintiffs contended that Section 10(b) and Rule 10b-5, which both prohibit any person from directly or indirectly using or employing a deceptive device or contrivance, clearly encompasses the banks' conduct in the Enron fraud case. Plaintiffs-Appellees are: -- Regents of the University of California; -- Washington State Investment Board; -- San Francisco City and County Employees' Retirement System; -- Employer-Teamsters Local Numbers 175 and 505 Pension Trust Fund; -- Hawaii Laborers Pension Plan; -- Staro Asset Management LLC; -- Amalgamated Bank, as Trustee for the Longview Collective Investment Fund; -- Robert V. Flint; -- John Zegarski; Mervin Schwartz, Jr.; -- Steven Smith; -- Archdiocese of Milwaukee; -- Greenville Plumbers Pension Plan; -- Nathaniel Pulsifer, as Trustee of the Shooters Hill -- Revocable Trust. Defendants-Appellants are: -- Credit Suisse First Boston (USA), Inc.; -- Credit Suisse First Boston LLC; -- Pershing LLC; -- Merrill Lynch & Co., Inc.; -- Merrill Lynch Pierce Fenner & Smith, Inc.; Barclays PLC, Barclays Bank PLC, Barclays Capital Inc. are also Appellants. However, just recently, the U.S. Supreme Court denied without comment the petition filed by Enron Corp. shareholders to review the appeals court ruling that blocked a class action against investment banks and firms that did business with the Enron prior to its collapse (Class Action Reporter, Jan. 22, 2008). To date as lead plaintiff, the University of California has so far reached these settlements: Arthur Andersen LLP, September 2006 $72.5 million Kirkland & Ellis LLP, September 2006 $13.5 million Canadian Imperial Bank of Commerce, August 2005 $2.4 billion JPMorganChase, June 2005, $2.2 billion Citigroup, June 2005, $2 billion Outside Directors, January 2005 $168 million Lehman Brothers, October 2004 $222.5 million Bank of America, July 2004 $69 million Andersen Worldwide SC, 2002 $32 million LJM2 bankruptcy recovery, 2004-05 $37 million For more details, contact: Patrick J. Coughlin, Esq. Lerach Coughlin Stoia Geller Rudman & Robbins, LLP 655 West Broadway, Suite 1900 San Diego, CA 92101 Phone: (415) 288-4545 Fax: (415) 288-4534 e-mail: patc@lerachlaw.com Web site: http://www.lerachlaw.com MCKESSON CORP: Seeks Dismissal of RICO Claims in Mass. Lawsuit -------------------------------------------------------------- McKesson Corp. is seeking for the dismissal of the Racketeer Influenced and Corrupt Organizations claims that were made in the class action, "New England Carpenters Health Benefits Fund et al., v. First DataBank, Inc. and McKesson Corporation, Case No. 05-11148," according to McKesson Corp.'s Feb. 1, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. Case Background The suit was originally filed with the U.S. District Court for the District of Massachusetts on October 2006 by Seattle-based Hagens Berman Sobol Shapiro (Class Action Reporter, Nov. 13, 2007). It was brought on behalf of consumers and third-party payers alleges that McKesson entered into a secret agreement to artificially inflate the reported average wholesale price of thousands of drugs, a benchmark used by Medicaid and insurance plans to determine payment to pharmacies. Class Certification Issues On Aug. 27, 2007, the court issued its ruling on the plaintiffs' petition for class certification. The court certified a class of third party payors for purposes of liability and equitable relief, but declined to certify such a class for purposes of a damages award. The court did certify a class of percentage co-pay consumers on issues of both liability and damages. Subsequently, at a Nov. 13, 2007 hearing, the court requested supplemental briefing on class certification issues. Supplemental briefing has been completed, but the court has not yet issued any order modifying its Aug. 27, 2007 class certification order. New Class Sought On Oct. 9, 2007, the plaintiffs filed a motion to amend the complaint to add a new class made up of uninsured purchasers of branded drugs who paid what is known as the Usual and Customary price, and plaintiffs also sought to add federal and state antitrust claims on behalf of the existing classes and the proposed new U&C class. On Nov. 6, 2007, the court denied the plaintiffs' motion to add antitrust claims, allowed the amendment to add a class of U&C consumers and indicated that the U&C class claims would be put on a different schedule from that of the two classes addressed in the August 2007 class certification order. On the same day, the plaintiffs filed a Third Amended Complaint which included the U&C class, and the court has subsequently set a trial date of Jan. 26, 2009, for claims by that class. No other trial date has been set in these matters. Dismissal of RICO Claims Sought On Dec. 13, 2007, the company filed a motion to dismiss the Racketeer Influenced and Corrupt Organizations claims on which the U&C class claims were based, and the company also moved for judgment on the pleadings with respect to the RICO claims supporting the two original classes. No hearing date has been set for argument of those motions. The suit is "New England Carpenters Health Benefits Fund, et al. v. First Databank, Inc., et al., Case No. 1:05-cv-11148-PBS," filed in the U.S. District Court for the District of Massachusetts under Judge Patti B. Saris. Representing the plaintiffs are: George E. Barrett, Esq. Barret Johnston & Parsley 217 Second Avenue N. Nashville, TN 37201-1601 Phone: 615-244-2202 e-mail: gbarrett@barrettjohnston.com Jennifer Fountain Connolly, Esq. The Wexler Firm, LLC, 2000 One LaSalle Street Chicago, IL 60602 Phone: 312-346-2222 Fax: 312-346-0022 e-mail: jfc@wtwlaw.us Barbara Mahoney, Esq. Hagens Berman Sobol Shapiro, LLP 1301 Fifth Avenue, Suite 2900 Seattle, WA 98101 Phone: 206-623-7292 Fax: 206-623-0594 e-mail: barbaram@hbsslaw.com - and - Spector, Roseman & Kodroff, P.C. 1818 Market Street, Suite 2500 Philadelphia, PA 19103 Phone: 215-496-0300 Fax: 215-496-6611 E-mail: classaction@srk-law.com Web site: http://www.srk-law.com MCKESSON CORP: Wants "Related" Antitrust Suit in Mass. Dismissed ---------------------------------------------------------------- McKesson Corp. is seeking for the dismissal of the antitrust class action, entitled, "New England Carpenters Health Benefits Fund et al., v. McKesson Corporation." The suit, which was filed with the U.S. District Court for the District of Massachusetts on Dec. 10, 2007, was brought as a "related" matter to "New England Carpenters Health Benefits Fund, et al. v. First Databank, Inc., et al., Case No. 1:05-cv- 11148-PBS." Listed as plaintiffs in the new case are: -- New England Carpenters Health Benefits Fund, -- Pirelli Armstrong Retiree Medical Benefits Trust, -- Teamsters Health & Welfare Fund of Philadelphia and Vicinity, -- Philadelphia Federation of Teachers Health and Welfare Fund, -- District Council 37, -- AFSCME-Health & Security Plan, -- June Swan, -- Bernard Gorter, -- Shelly Campbell, and -- Constance Jordan. In general, the new complaint incorporates the federal and state antitrust claims that could not be brought by way of amendment to the existing class complaint. On Jan. 31, 2008, the company filed a motion to dismiss the new antitrust class action, according to McKesson Corp.'s Feb. 1, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. The new suit is "New England Carpenters Health Benefits Fund et al., v. McKesson Corporation, Case No. 1:07-12277," filed with the U.S. District Court for the District of Massachusetts, Judge Patti B. Saris, presiding. Representing the plaintiffs is: Steve W. Berman, Esq. Hagens Berman Sobol Shapiro LLP 1301 5th Avenue, Suite 2900 Seattle, WA 98101-1090 Phone: 206-623-7292 Fax: 206-623-0594 e-mail: steve@hbsslaw.com Representing the defendant is: James P. Bennett, Esq. Morrison & Foerster LLP 425 Market Street San Francisco, CA 94107-2406 Phone: 415-268-7000 Fax: 415-268-7522 e-mail: jbennett@mofo.com MEAT PACKERS: Appeals Court Reverses $9.3M Ruling in Cattle Case ---------------------------------------------------------------- A three-judge panel of the 8th U.S. Circuit Court of Appeals reversed the district court's 2006 ruling in favor of cattle ranchers who claimed that four large meat packing companies underpaid producers for live cattle by taking advantage of a pricing error made by the U.S. Department of Agriculture in 2001, press reports say. The class action lawsuit, filed with the U.S. District Court for the District of South Dakota in 2002, by Herman Schumacher of Herreid, Michael Callicrate of Kansas, and Roger Koch of Nebraska, sought almost $43 million from: 1. Tyson Fresh Meats Inc., 2. Cargill Meat Solutions Corp., 3. Swift Beef Co., and 4. National Beef Packing Co. According to the Associated Press, the federal appeals court found that the cattle ranchers, who won a $9.25-million federal jury verdict against the meat packers, failed to show that the companies were guilty of price manipulation. AP explains that from April 2, 2001, to May 11, 2001, the USDA misreported the boxed beef cutout prices for choice and select cuts of meat. The erroneous reports were the result of a flawed computer program that took into account a lesser quality of beef when calculating cutouts for choice and select cuts. As a result, the choice and select cutouts were too low. The lawsuit alleged that the meatpackers knowingly used this information to pay less to cattle producers than they would have if the cutouts were correct. The packers, however, denied knowing about the faulty reports before the USDA acknowledged them. The recent ruling stated that the ranchers produced no evidence that the packers intentionally violated the Packers and Stockyards Act by manipulating or controlling cattle, or attempting to manipulate or control, prices. To prove a violation, the ruling noted, a plaintiff must show that a packer intentionally committed unlawful conduct. "Therefore, the district court erred when it instructed the jury that a showing of intent was not required and reversal of the district court is necessary," the judges ruled. "The appeals court ruling confirms our long-standing position that our company acted appropriately and should not be penalized for the government's mistake," The Morning News cites a statement by Tyson Foods. Mr. Schumacher, AP notes, vowed to press on with the legal battle. The case it captioned "Schumacher v. Tyson Fresh Meats, Inc.," Case No: 2006 DSD 12, filed with the U.S. District Court for the District of South Dakota, Northern Division. Representing the plaintiffs are: Elizabeth J. Anderson, Esq. David F. Herr, Esq. Maslon, Edelman, Borman & Brand 3300 Wells Fargo Center 90 S. 7th St. Minneapolis, MN 55402-4140 Phone: (612) 672-8200 Fax: 672-8397 email: david.herr@maslon.com Representing the defendants are: William H. Baumgartner, Jr., Esq. Sidley Austin LLP One South Dearborn Street Chicago, IL 60603 Phone: (312) 853-7000 Fax: (312) 853-7036 e-mail: wbaumgartner@sidley.com - and - Patrick E. Brookhouser, Jr., Esq. McGrath North Mullin & Kratz, PC LLO 1601 Dodge St., Suite 3700 First Natl. Tower Omaha, NE 68102-1627 Phone: (402) 341-3070 Fax: (402) 341-0216 e-mail: pbrookhouser@mnmk.com MICHIGAN: Court-Appointed Experts Cite Problems in Foster Care -------------------------------------------------------------- The Michigan Department of Human Service is facing a class- action lawsuit filed in August 2006 by New York-based Children's Rights, a national child advocacy group that alleges 19,000 Michigan children are being harmed in foster care. U.S. District Judge Nancy Edmunds, who is overseeing the class- action lawsuit, earlier appointed The Children's Research Center, a non-profit group based in Madison, Wis., to conduct the case record review. According to Free Press, the study found that the Michigan Department of Human Services failed to follow its own policies and to meet basic standards for care of foster children. The report, which was released on Feb. 5, 2008, said that the state: * failed to run required checks on the homes of relatives where children were placed; * missed required visits to children; * bounced children from one foster home to another; and * failed to keep adequate medical records for children. Specifically, the Associated Press says that the study found that state caseworkers did not make required face-to-face visits with children in foster care and failed to conduct background checks before placing children with relatives. The analysis of the cases of 460 children in the custody of the Michigan Department of Human Service also found that caseworkers did not adequately plan for the children's needs early in their foster care placements. AP explains that policy states that caseworkers make two face- to-face contacts with children during their first month in foster care. However, caseworkers did not make any contacts in 31% of the 460 cases analyzed by the Children's Research Center. Experts also said that about 41% of children were moved at least three times during foster care. Michigan officials, according to Free Press, questioned the methodology of the report. Initially, Michigan officials said that they wanted to try to settle the suit, AP recounts. However, settlement talks broke off in 2007 when the state said it had no money to enact reforms. A trial date for the lawsuit has been set for June. Sara Bartosz, Esq., the lead lawyer in the case, told Free Press that she expects the report to figure prominently in the group's lawsuit against the state. The group hopes to convince Judge Edmunds to order the state to make changes to the system. OWN MY TRAVEL: Suit on Behalf of Pyramid Scheme Investors Looms --------------------------------------------------------------- Some Orlando residents claim that they lost thousands of dollars after investing in an apparent discount travel venture that may have been a pyramid scheme, Local6.com reports, citing a Problem Solvers investigation. The report relates that the Own My Travel business sold discount travel memberships to all takers from Orlando to Los Angeles out of an office near Lake Eola. The venture promises a steady stream of lifetime cash. According to Local6, sales hit $10 million at one point. However, in December 2007, the staff stopped showing up and OMT was gone, including the money. Local6 cites attorneys as saying that more than 2,000 Orlando residents lost anywhere from $2,500 to $100,000 in connection with the business. OMT's chief executive officer, Darrell West, said that rumors ruined the company, the report notes. He said that it was not a pyramid scheme and the money went to commissions. Winter Park attorney Eric Lanigan's firm is teaming up with Robert Sirianni, Esq., to file a class-action lawsuit on behalf of dozens of investors. "Everything we've seen points to a classic type of scheme or artifice to defraud," Mr. Lanigan told Local6. "Ultimately, what happened was the money went into the pockets of the three principal members [] and went back to Nevada," Mr. Sirianni said. Local6 says that it is not known if any of the investors will get any of their money back. Eric A. Lanigan, Esq., can be reached at: Eric A. Lanigan Suite 105, 174 W. Comstock Ave. Winter Park, FL 32789-4347 Phone: (800) 785-9090 (407) 740-7379 Fax: (407) 740-6812 PACIFIC CYCLE: Recalls Trailer Bikes Posing Injuries to Children ---------------------------------------------------------------- Pacific Cycle Inc., of Madison, Wis., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 7,000 InStep "Pathfinder," Schwinn "Run About," and Mongoose "Alley Cat" Trailer Bicycles. The company said the coupler connecting the children's trailer bike to the adult's bicycle has welds that can fail, posing a fall hazard to children. Pacific Cycle has received one report of the coupler failing, resulting in a fall and abrasions to the rider. The "Pathfinder," "Run About," and "Alley Cat" are single- wheeled, children's bicycles that connect to an adult's bicycle by a coupler. The recall includes model numbers: 12-PF250, 13- SC250, 13-SC350 and M5101. The model number is located on the lower seat tube of the frame. The affected couplers have welded plates; bicycles that have couplers with cast parts are not included in this recall. The recalled trailer bikes were manufactured in China and were being sold at bicycle stores and retailers nationwide from January 2007 through August 2007 for between $80 and $120. Pictures of the recalled trailer bikes are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08156a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08156b.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08156c.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08156d.jpg Consumers are advised to stop using the trailer bicycle immediately and contact the firm for a free repair kit. For additional information, contact Pacific Cycle toll-free at (877) 564-2261, 8:00 a.m.-5:00 p.m., CT, Monday-Friday, or visit these Web sites: http://www.instep.net http://www.schwinnbikes.comor http://www.mongoose.com PILGRIM'S PRIDE: Fifth Circuit Denies Appeal in "Wheeler" Case -------------------------------------------------------------- The U.S. Court of Appeals for the Fifth Circuit denied the plaintiffs' appeal of an order that quashed their request for class certification of one of two similarly titled lawsuits, "Cody Wheeler, et al. v. Pilgrim's Pride Corp., et al.," according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 29, 2007. Original Wheeler Litigation On July 1, 2002, three individuals, on behalf of themselves and a putative class of chicken growers, filed their original class action complaint against the company in the U.S. District Court for the Eastern District of Texas, styled "Cody Wheeler, et al. v. Pilgrim's Pride Corp." In their lawsuit, plaintiffs initially alleged that the Company violated the Packers and Stockyards Act (7 U.S.C. Section 192) and breached fiduciary duties allegedly owed to the plaintiff growers. The plaintiffs also brought individual actions under the Packers and Stockyards Act alleging, among other things, breach of fiduciary duties and breach of contract. On Sept. 30, 2005, the plaintiffs amended their lawsuit to join Tyson Foods, Inc. as a co-defendant. Two additional former chicken growers were also added as plaintiffs to the lawsuit. This amendment, which occurred 38 months after the lawsuit's initial filing, virtually re-wrote most of the allegations. Now the plaintiffs contend that the Company and Tyson are involved in a conspiracy to violate federal antitrust laws. The plaintiffs' initial allegations, although still contained in the amended lawsuit, are no longer the sole focus of the case. On Jan. 3, 2006, the Court entered an order severing the plaintiffs' Packers and Stockyards Act and antitrust claims. After severance, the plaintiffs voluntarily withdrew their request for class certification of the Packers and Stockyards Act and antitrust claims, and the Court subsequently entered an order prohibiting the plaintiffs from filing any additional class-action claims against Pilgrim's Pride in this lawsuit. New Wheeler Litigation On Jan. 3, 2006, an action styled, "Cody Wheeler, et al. v. Pilgrim's Pride Corp., et al.," arising out of the original Wheeler litigation described above, was filed with the U.S. District Court for the Eastern District of Texas. The lawsuit was filed by the three original plaintiffs and a former grower, both in their individual capacities and on behalf of a putative class of chicken growers. In the lawsuit, the four plaintiffs allege that the Company and Tyson are involved in a conspiracy to violate federal antitrust laws. On Sept. 28, 2007, the court issued an order denying the plaintiffs' request to certify a class action. The plaintiffs filed the Petition for Permission to Appeal the District Court's Order on Oct. 15, 2007, with the U.S. Court of Appeals for the Fifth Circuit, which was denied on Dec. 7, 2007. Both of the Wheeler cases now involve only individual claims, and the Company intends to defend vigorously against these individual claims. The Company does not believe these matters will have a material impact on its financial condition, results of operations and cash flows, and the Company does not intend to provide updates regarding these cases in its future periodic reports. Pilgrim's Pride Corp. -- http://www.pilgrimspride.com/-- is a producer of poultry in the U.S., Mexico and Puerto Rico. In the U.S., the Company produces prepared and fresh chicken, and turkey while in Mexico and Puerto Rico, it produces only fresh chicken. Through vertical integration, it controls the breeding, hatching and growing of chickens, and the processing and preparation, packaging and sale of its product lines. POTTERY BARN: Recalls Decorative Candles Due to Fire Hazard ----------------------------------------------------------- Pottery Barn of San Francisco, Calif., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 185,000 round and egg-shaped decorative candles. The company said the candle's exterior coating can ignite, posing a fire hazard. Pottery Barn has received two reports of the gold paint on the candle exterior igniting. No injuries or property damage have been reported. This recall involves egg-shaped and large and small round candles sold in three sizes. The candles were sold in green, red and white with gold glitter and leaf designs. The recall includes all styles of this candle, including style numbers 9444811, 9444928, 9444936, 9444944, 9444944, 9445214, 9445222, 9445222, and 9445313. The style number for the candles can be found on the price ticket under the candle. These recalled candles were manufactured in Hong Kong and were being sold at Pottery Barn stores nationwide from September 2007 through December 2007 for between $10 and $20. Picture of recalled candles is found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08168.jpg Consumers are advised to immediately stop using the recalled candles and return them to any Pottery Barn store for a full refund. For additional information, contact Pottery Barn toll-free at (888) 922-9245, between 7:00 a.m. And 12:00 a.m. ET, Monday through Sunday, or visit the company's Web site at http://www.potterybarn.com RADIATION THERAPY: Settles Suits Over RTS Merger Agreement ----------------------------------------------------------- Radiation Therapy Services, Inc. (Nasdaq: RTSX) previously disclosed that two lawsuits were filed in connection with a proposed Plan of Merger -- dated as of Oct. 19, 2007, among the Company, Radiation Therapy Services Holdings, Inc., and RTS MergerCo, Inc. -- on Oct. 24, 2007, and Nov. 16, 2007, respectively. The suits were filed against the Company, each of the Company's directors and Vestar Capital Partners as purported class actions on behalf of the public shareholders of the Company in the Circuit Court of Lee County, Florida. On Jan. 3, 2008, the plaintiff in the first case voluntarily dismissed his claims. The second case was settled in principle on Feb. 1, 2008, by the parties with no admission of any liability. The settlement is subject to court approval and consummation of the transactions contemplated by the Merger Agreement. At this time, there are no other pending actions challenging the proposed merger. Headquartered in Fort Myers, Florida, Radiation Therapy Services Inc. (Nasdaq: RTSX) -- http://www.rtsx.com/-- operates radiation treatment centers under the name 21st Century Oncology. The company is a provider of radiation therapy services to cancer patients. The company's 80 treatment centers are clustered into 25 local markets in 16 states, including Alabama, Arizona, California, Delaware, Florida, Kentucky, Maryland, Massachusetts, Michigan, Nevada, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island and West Virginia. SEVENTY TWO INC: Recalls Hoodies Due to Strangulation Hazard ------------------------------------------------------------ Seventy Two Inc., of La Puente, Calif., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 1,800 Bonafide Love Hooded Children's Sweatshirts. The company said the garments have a drawstring through the hood, which can pose a strangulation hazard to children. No injuries have been reported. This recall involves the Bonafide Love children's hooded sweatshirts. The sweatshirts are reversible and come in two styles. The hearts and stars style is green and in the front has a heart surrounded by pink stars. On the reverse, it is hot pink with light pink dots. The Robots style is gray with drawings of robots and pink hearts. On the reverse, it has a zebra-like pattern with gray and black stripes. "Bonafide Love" is printed on a label sewn into the collar. These recalled children's hoodies were manufactured in China and were being sold exclusively at Nordstrom retail stores nationwide from November 2007 through December 2007 for about $40. Pictures of recalled hoodies are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08185a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08185b.jpg Consumers should immediately remove the drawstrings to eliminate the hazard or return the sweatshirts to Nordstrom or to Seventy Two for a full refund. For additional information, contact Seventy Two Inc. collect at (626) 330-8027 ext. 170 between 9:00 a.m. and 6:00 p.m. ET, Monday through Friday. SOMA FINANCIAL: Faces Calif. Suit Over PayOption Sale Omissions --------------------------------------------------------------- Soma Financial, Inc., is facing a class-action complaint filed with the U.S. District Court for the Eastern District of California accusing it of using deception and omissions to sell PayOption adjustable-rate mortgages that produce negative amortization, CourtHouse News Service reports. The complaint alleges that defendants marketed and sold a PayOption Adjustable Rate Mortgage as loan that would allow the borrower to choose a very low payment schedule in the PayOption ARM loan documents and the Truth in Lending Disclosure Statement. However, the payment schedule set forth in the TILDS bore no relation to the interest rate stated in the note and the TILDS. In fact, following the payment schedule in the TILDS would result in payments that are insufficient to pay the interest due on the PayOption ARM and the deficit would be added on to the principal, a process known as negative amortization. This results to borrowers owing more than the loan amount and a decrease in the equity of their homes. The action arises from the fact that defendants failed to disclose to borrowers that the interest rate used to calculate the payment schedule was not the interest rate stated in the note and the TILDS and that negative amortization was guaranteed if they followed the payment schedule set forth in the TILDS. Named plaintiff Catherine Anne Campbell brings this action to recover damages and other relief available at law and in equity on behalf of all individuals who within the four year period preceding the filing of plaintiff's complaint through the date notice is mailed to the class, received a PayOption ARM loan through defendants on their primary residence located in the State of California for which the initial payment amount was insufficient t cover the interest charged on the loan. Ms. Campbell wants the court to rule on: (a) whether defendants' acts and practices violate the Truth in Lending Act, 15 USC Section 1601, et seq.; (b) whether defendants' conduct violated 12 CFR Section 226.17; (c) whether defendants' conduct violated 12 CFR Section 226.19; (d) whether defendants had a duty to disclose to plaintiffs important material information concerning their loans, including, but not limited to: (i) that the payment amounts listed in the TILDS were insufficient to pay both principal and interest; (ii) that the payment schedule was not based on the listed interest rate; and (iii) that negative amortization would occur if plaintiff made payments according to the schedule of payments defendants listed in the TILDS; (e) whether defendants, by and through their officers, employees and agents concealed, omitted and otherwise failed to disclose information they were mandated to disclose under TILA; (f) whether defendants failed to disclose, and by omission, failed to inform plaintiff that the payment schedule was not based on the interest rate disclosed in the note and TILDS; (g) whether defendants failed to disclose, and by omission, failed to inform plaintiff that the payment amounts listed in the note and TILDS are insufficient to cover both principal and interest; (h) whether defendants failed to disclose, and by omission, failed to inform plaintiff that negative amortization was absolutely certain to occur if plaintiff made the payments according to the payment schedule provided by defendants; (i) whether defendants engaged in unfair business practices aimed at deceiving plaintiff and the class members before and during the loan application process; (j) whether defendants' failure to apply plaintiff and the class members payments to principal as promised in the notes constitutes a breach of the contract, including of the covenant of good faith and fair dealing; (k) whether defendants breached the covenant of good faith and fair dealing; (l) whether the terms and conditions of defendants' PayOption ARM home loan are unconscionable, including but not limited to: (i) listing a payment amount and interest rate which bear no relation to each other; (ii) stating that the payment "could be less" than the interest due when, in fact, negative amortization was guaranteed to occur if consumers followed the payment schedule provided by defendants in the TILDS; and (iii) under the terms and conditions of these loans, the pre-payment penalty provision; (m) whether plaintiffs are entitled to declaratory relief, including, but not limited, to whether defendants' PayOption ARM loan violates TILA; (n) whether plaintiff and the class are entitled to rescission under TILA; (o) whether plaintiff and the class are entitled to punitive damages; and (p) whether plaintiff and the class are entitled to equitable relief, including but not limited to, restitution and injunctive relief. The Plaintiff requests entry of an order: -- certifying the case as a class action and appointing plaintiff and their counsel to represent the class; -- providing actual damages according to proof; -- providing compensatory damages as permitted by law; -- providing consequential damages as permitted by law; -- providing rescission; -- providing equitable relief, including restitution; -- providing restitutionary disgorgement of all profits defendants obtained as a result of their unfair competition; -- providing declaratory relief; -- providing reasonable attorneys' fees and costs; and -- providing such other relief as is just and proper. The suit is "Catherine Anne Campbell et al. v. Soma Financial, Inc.," filed with the U.S. District Court for the Eastern District of California. Representing the plaintiffs are: Brian S. Kabateck, Esq. Richard L. Kellner, Esq. Kabateck Brown Kellner LLP 644 South Figueroa Street Los Angeles, CA 90017 Phone: (213) 217-5000 Fax: (213) 217-5010 TRUCKEE CARSON: Two Flood-Related Suits Moved to Federal Court -------------------------------------------------------------- Attorneys for the Truckee Carson Irrigation District have had a pair of class action lawsuits against it moved from district court to U.S. Federal Court, the Reno Gazette Journal reports. The lawsuits were brought against the irrigation district by over 100 Fernley flood victims. The flood was caused by the rupture of an irrigation canal during a storm on Jan. 5. There are three similar lawsuits filed against TCID, but only two were moved: 1. "Shows v. Truckee-Carson Irrigation District, Case. No. 3:08-cv-00044" filed on Jan. 24, 2008, transferred to the U.S. District Court for the District of Nevada. The case is represented by Robert C. Maddox, Esq. The case was initiated with the Third Judicial District Court of the State of Nevada County of Churchill. 2. "Reynolds, et al. v. Board of Directors of Truckee-Carson Irrigation, et al., Case No. 3:2008cv00045," filed on Jan. 24, 2008, U.S. District Court for the District of Nevada. The suit is represented by Charles A. Jones, Esq. The case was originally with the Third Judicial District of Nevada, County of Lyon. Although Reno attorney Robert Hager, Esq., indicated that his 70 clients have also sued TCID, he said he will not move his lawsuit to federal court because the suit also names other defendants, including the City of Fernley, Lyon County, developers, and real estate agencies, and that the district court is the appropriate jurisdiction. In each of three lawsuits, the Reno Gazette says, the complaints indicate that TCID failed to maintain and monitor the Truckee Canal, and respond to a January 5 breach in the canal once it occurred. According to the Reno Gazette, TCID attorney Gary Cardinal, Esq., filed a "Notice of Removal to Federal Court," indicating that TCID is a government contractor that performs operation and maintenance of the Newlands Project under the supervision and control of the U.S. government. Mr. Maddox indicated that he recently sent a letter to the TCID asking the irrigation district to "desist from filling the canal (with water). We have yet to receive a response from them," he said, adding that his firm has retained an engineer specializing in levees and dams to assist with an analysis of the canal. Mr. Maddox also indicated that his firm has obtained subdivision maps and gathered other data to determine "responsibility for blocking drainage channels which exacerbated the impact of the flood." The plaintiffs in the first class action lawsuit are represented by: Robert C. Maddox, Esq. 10587 Double R Blvd, Ste 100 Reno, NV 89521 Phone: (775) 322-3666 Fax: (775) 322-6338 e-mail: efiling@maddoxandassociates.com - and - Calvin R.X. Dunlap, Esq. Law Office of Calvin R.X. Dunlap P.O. Box 3689 Reno, NV 89505 Phone: (775) 323-7790 Fax: (775) 323-5454 e-mail: worldlyx@worldnet.att.net The plaintiffs in the second class action lawsuit are represented by: Charles A. Jones, Esq. McInerney & Jones 9460 Double R Blvd Suite 503 Reno, NV 89521 Phone: (775) 853-6440 Fax: (775) 853-6445 e-mail: caj@mcinerneylaw.net The defendant is represented by: Gary A Cardinal, Esq. Erickson, Thorpe & Swainston, Ltd. 99 West Arroyo Street P.O. Box 3559 Reno, NV 89509 Phone: (775)786-3930 Fax: (775)786-4160 e-mail: gcardinal@etsreno.com UNITED STATES: Says Vets Not Entitled to Specific Medical Care -------------------------------------------------------------- The Bush administration filed its arguments in a lawsuit with the U.S. District Court for the Northern District of California in San Francisco stating that veterans have no legal right to specific types of medical care, the San Francisco Chronicle reports. According to Kaiser Network, the government's arguments were filed in response to a class-action lawsuit initiated by the Veterans for Common Sense and Veterans United for Truth, which claims that vets were illegally denied mental health treatment by the Department of Veterans Affairs. As reported in the Class Action Reporter on Jan. 15, 2008, U.S. District Court Judge Samuel Conti allowed the class action to go ahead against the Department of Veterans Affairs. The lawsuit sought to be a nationwide class action on behalf of an estimated 320,000 to 800,000 post-9/11 veterans of the wars in Iraq and Afghanistan suffering from Post Traumatic Stress Disorder. VCSVUT alleges that Veterans Affairs is responsible for a "systemwide pattern of abusive and illegal administrative practices." The lawsuit claims that VA: -- failed to deliver the mandatory two years of disability benefits for veterans; -- failed to address staff problems that led to long wait times for care and provided insufficient care for post- traumatic stress disorder; and -- deliberately reclassified PTSD claims as pre-existing disorders as a way to avoid paying out benefits. Judge Conti, Kaiser Network recounts, ruled that federal law entitles veterans to health care for a period of two years after leaving the service. A bill recently signed by President Bush extends the period from two to five years. However, according to government lawyers, federal law establishes "veterans' eligibility for health care, but it does not create an entitlement to any particular medical service." The lawyers said the law entitles veterans only to "medical care which the secretary [of Veterans Affairs] determines is needed, and only to the extent funds . . . are available." Kaiser Network notes that the government attorneys also said VA "is making great progress in addressing the mental health care needs of combat veterans," citing a law passed in November 2007 that established a suicide-prevention program that makes mental health care available around the clock. A hearing on the case is set before March 7, 2008. The case is captioned "Veterans for Common Sense, et al. v. Nicholson, et al., Case No. 3:2007cv03758," filed with the U.S. District Court for the Northern District of California, Judge Samuel Conti, presiding. The plaintiffs are represented by: Jennifer Weiser Bezoza, Esq. Katrina Kasey Corbit, Esq. Disability Rights Advocates 2001 Center Street Fourth Floor Berkeley, CA 94704 Phone: (510) 665-8644 Fax: (510) 665-8511 e-mail: jbezoza@dralegal.org KCorbit@dralegal.org - and - Gordon P. Erspamer, Esq. Morrison & Foerster 101 Ygnacio Valley Road, Suite 450 Walnut Creek, CA 94596 Phone: 925/295-3341 e-mail: GErspamer@mofo.com The defendants are represented by: Daniel Bensing, Esq. U.S. Dept. of Justice 20 Massachusetts Ave., N.W. Rm 6114 Washington, DC 20530 Phone: (202) 305-0693 Fax: (202) 616-8460 e-mail: Daniel.Bensing@USDOJ.gov - and - Steven Yale Bressler, Esq. U.S. Department of Justice Civil Division, Federal Programs Branch 20 Massachusetts Ave., NW Washington, DC 20530 Phone: (202) 514-4781 e-mail: steven.bressler@usdoj.gov VALUECLICK: Ohio Resident Sues Over "Free" Merchandise Promises --------------------------------------------------------------- Cleveland Heights, Ohio resident Dan Cheyfitz sued ValueClick, Inc., last month, over the use of the word "free" in its Web ads, Wendy Davis of Mediapost.com reports. Mr. Cheyfitz accuses ValueClick and its subsidiaries of violating a provision of Ohio's consumer protection law by promising "free" goods without also prominently stating that consumers first had to make a purchase or otherwise participate in an offer before they were eligible for the free merchandise. Mr. Cheyfitz alleges that he received "voluminous" e-mails from ValueClick falsely promising "free" items "which were, in fact, not free." The complaint asserts, "None of the email received by plaintiff and from defendants clearly and conspicuously set out the 'terms and conditions' of receiving the 'free' items at the outset of the offer." According to the report, Ohio's consumer protection law requires that disclaimers about free merchandise must be printed in a font at least half as big as the word free and in "close conjunction" to the term. Mr. Cheyfitz is seeking damages of up to $1,500 per e-mail, on the theory that the "free" merchandise promoted was worth around $500 and that Ohio provides for consumers to recover up to three times their damages, the report says. Using this formula, Mr. Cheyfitz is seeking a total of up to $75,000 for himself and $4.9 million for the class, assuming the court certifies one. Alternatively, he's seeking up to $200 per violation -- an amount set by Ohio's consumer protection statute. Mr. Cheyfitz's lawyer, Joseph Compoli, Jr., Esq., said that Mr. Cheyfitz isn't alleging that he made any purchases, but charges that the ads caused him to waste time clicking through to other Web pages to learn the details of the offer. Mr. Compoli, who has previously sued marketers for sending junk faxes, is seeking class-action status for this case against ValueClick. ValueClick filed an answer in which it denied most of the allegations or said it did not have enough information to address them, Mediapost adds. Westlake Village, Calif.-based ValueClick, Inc., offers a suite of products and services that enable marketers to advertise and sell their products through all major online marketing channels� display advertising, lead generation marketing, email marketing, search marketing, comparison shopping, and affiliate marketing. VISA INC: Added as Defendant in Calif. "Attridge" Litigation ------------------------------------------------------------ Visa, Inc. was added as a defendant in the purported class action, "Attridge v. Visa U.S.A. Inc., et al.," which is asserting claims under California's Cartwright Act and Unfair Competition Law, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. The complaint was filed with a California state court on Dec. 8, 2004. It was brought on behalf of a putative class of consumers against Visa U.S.A., Visa International and MasterCard. The claims in the action seek to piggyback on the portion of a DOJ litigation in which the U.S. District Court for the Southern District of New York found that Visa's bylaw 2.10(e) and MasterCard's Competitive Programs Policy constitute unlawful restraints of trade under the federal antitrust laws. After the plaintiff twice amended his complaint, Visa U.S.A., Visa International and MasterCard demurred to (moved to dismiss) the complaint and, at a hearing on Nov. 2, 2005, the court dismissed plaintiffs claims with leave to amend. On Dec. 2, 2005, the plaintiff filed a third amended complaint. The defendants again demurred that complaint. On May 19, 2006, the court entered an order dismissing plaintiffs Cartwright Act claims with prejudice but allowing the plaintiff to proceed with his Unfair Competition Law claims. On June 19, 2006, Visa U.S.A., and Visa International answered the third amended complaint. The parties are now moving forward with discovery. No trial date has been set. On Dec. 14, 2007, the plaintiff amended his complaint to add Visa, Inc., as a defendant. No new claims were added to the complaint. For more details, contact: Lingel H. Winters, Esq. 1 Maritime Plaza, Suite 400 San Francisco, California 94111-3492 Phone: 415-398-2941 Fax: 415-393-9887 Web site: http://www.lawyers.com/winterslaw/ VISA INC: N.Y. Court Dismisses Claims for Damages in MDL-1720 ------------------------------------------------------------- The U.S. District Court for the Eastern District of New York dismissed the class plaintiffs' claims for damages in the matter, "In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, MDL-1720, 1:05-md-01720-JG-CLP," which names subsidiaries of Visa, Inc., as defendants, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. Georgia Litigation On May 6, 2005, a purported class action was filed by a merchant, Animal Land, Inc., against Visa U.S.A. with the U.S. District Court for the Northern District of Georgia, alleging that Visa U.S.A.'s no-surcharge rule violates Sections 1 and 2 of the Sherman Act. The plaintiff alleges that under the no-surcharge rule, merchants are not permitted to pass along to cardholders a discrete surcharge to account for the fees that the merchant pays in connection with Visa-branded payment card transactions. The plaintiff alleges that this rule causes the fees paid by merchants to be supracompetitive. The suit seeks treble damages in an unspecified amount, attorneys fees and injunctive relief. The Animal Land case has been transferred to the multidistrict litigation proceedings and is included in the First Amended Class Action Complaint discussed below. Connecticut Litigation On June 22, 2005, a purported class action was filed by a group of merchants with the U.S. District Court of Connecticut against MasterCard, Visa U.S.A., Visa International, and a number of Visa U.S.A., and Visa International member financial institutions alleging, among other things, that Visas and MasterCards purported setting of interchange fees violates Section 1 of the Sherman Act. In addition, the complaint alleges Visas and MasterCards purported tying and bundling of transaction fees also constitutes a violation of Section 1 of the Sherman Act. Other Litigation Since the filing of this complaint, there have been approximately 48 similar complaints, all but 10 of which were styled as class actions, filed on behalf of merchants against Visa U.S.A. and MasterCard, and in some cases, certain Visa U.S.A. and Visa International member financial institutions, in U.S. federal courts. Visa International was named as a defendant in more than 30 of these complaints. Multidistrict Litigation On Oct. 19, 2005, the Judicial Panel on Multidistrict Litigation issued an order transferring these cases to the U.S. District Court for the Eastern District of New York for coordination of pre-trial proceedings (Multidistrict Litigation 1720). On April 24, 2006, the group of purported class plaintiffs filed a First Amended Class Action Complaint. Taken together, the claims in the First Amended Class Action Complaint and in the 10 complaints brought on behalf of individual merchants are generally brought under Sections 1 and 2 of the Sherman Act. In addition, some of these complaints contain certain state unfair competition law claims. These interchange-related litigations also seek treble damages in an unspecified amount (although several of the complaints allege that the plaintiffs expect that damages will range in the tens of billions of dollars), as well as attorneys fees and injunctive relief. Visa U.S.A., and Visa International answered the First Consolidated Amended Class Action Complaint and the individual merchant complaints on June 9, 2006. On July 10, 2007, pursuant to a joint request by the parties, the court entered a scheduling order setting deadlines for completion of fact discovery to June 30, 2008 and expert discovery to Feb. 20, 2009, and for filing all summary judgment and other pretrial motions by March 27, 2009. On Sept. 7, 2007, the Magistrate Judge issued a Report and Recommendation to the District Court recommending that the District Court grant the defendants motion to dismiss the class plaintiffs claims for damages incurred prior to Jan. 1, 2004. On Oct. 12, 2007, the Magistrate Judge granted putative class plaintiffs request to brief the issue of whether the Report and Recommendation would affect the claims of non-party members of the putative class that opted out of the "In re Visa Check/ MasterMoney Antitrust Litigation." Following the submissions, the Magistrate Judge declined plaintiffs request to advise on that issue. Putative class plaintiffs filed objections to the Report and Recommendation on Nov. 14, 2007, and defendants filed their responses to those objections on Dec. 13, 2007. On Jan. 8, 2008, the court adopted the Magistrate Judges Report and Recommendation without modification, dismissing the class plaintiffs claims for damages incurred prior to Jan. 1, 2004. Visa, Inc. -- http://www.corporate.visa.com-- is a retail electronic payments network. The Company facilitates global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses and government entities. Its primary customers are financial institutions, for which it provides processing services and payment product platforms, including platforms for consumer credit, debit, prepaid and commercial payments. The Company has three business operations: transaction processing services, product platforms and payments network management. VISA USA: Ninth Circuit Mulls Appeal Over "Kendall" Suit Nixing --------------------------------------------------------------- The U.S. Court of Appeals for Ninth Circuit has yet to rule on an appeal regarding the dismissal of the purported class action, "Kendall v. Visa U.S.A. Inc., et al." On Oct. 8, 2004, a purported class action was filed by a group of merchants in the U.S. District Court for the Northern District of California against Visa U.S.A., MasterCard and several Visa U.S.A. member financial institutions alleging, among other things, that Visa U.S.A.'s and MasterCard's interchange fees contravene the Sherman Act and the Clayton Act (Kendall v. Visa U.S.A. Inc., et al.). The plaintiffs seek treble damages in an unspecified amount, attorneys fees and an injunction against Visa U.S.A., and MasterCard from setting interchange and engaging in joint marketing activities, which plaintiffs allege include the purported negotiation of merchant discount rates with certain merchants. On Nov. 19, 2004, Visa U.S.A. filed an answer to the complaint. The plaintiffs filed an amended complaint on April 25, 2005. Visa U.S.A. moved to dismiss the complaint for failure to state a claim and, in the alternative, also moved for summary judgment with respect to certain of the claims. On July 25, 2005, the court issued an order granting Visa U.S.A.'s motion to dismiss, and dismissed the complaint with prejudice. On Aug. 10, 2005, the plaintiffs filed a notice of appeal. Appellate briefing is complete and the U.S. Court of Appeals for Ninth Circuit heard oral argument on June 11, 2007. No ruling has been issued, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. The suit is "Kendall et al v. Visa U.S.A. Inc. et al., Case No. 3:04-cv-04276-JSW," filed with th U.S. District Court for the Northern District of California, Judge Jeffrey S. White presiding. Representing the plaintiffs is: Richard Joseph Archer, Esq. Archer & Hansen 3110 Bohemian Highway Occidental, CA 95465 Phone: 707-874-3438 Fax: 707-874-3438 e-mail: archerdic@aol.com Representing the defendants are: Marie L. Fiala, Esq. Heller, Ehrman, White & McAuliffe LLP 333 Bush Street San Francisco, CA 94104 Phone: (415) 772-6527 e-mail: mfiala@hewm.com - and - Jay Neil Fastow, Esq. Weil Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153 Phone: 212-310-8644 Fax: 212-310-8007 e-mail: jay.fastow@weil.com VISA USA: Mounts Successful Defense V. Multiple Consumer Suits -------------------------------------------------------------- Visa U.S.A. successfully defended itself against several lawsuits in different jurisdictions that were generally alleging state antitrust, consumer protection, and common law claims, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. Despite the dismissals, the company still continues to face one such case in New Mexico. Initially, complaints were filed in 19 different states and the District of Columbia, alleging state antitrust, consumer protection and common law claims against Visa U.S.A. and MasterCard on behalf of putative classes of consumers. The claims in these actions largely mirror the allegations made in the U.S. merchant lawsuit and assert that merchants, faced with excessive merchant discount fees, have passed on some portion those fees to consumers in the form of higher prices on goods and services sold. Visa U.S.A. has been successful in the majority of these cases, as courts 17 jurisdictions have granted Visa U.S.A.'s motions to dismiss for failure to state a claim or plaintiffs have voluntarily dismissed their complaints. The parties are awaiting a decision on Visa U.S.A.'s motion to dismiss in New Mexico. Visa, Inc. -- http://www.corporate.visa.com-- is a retail electronic payments network. The Company facilitates global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses and government entities. Its primary customers are financial institutions, for which it provides processing services and payment product platforms, including platforms for consumer credit, debit, prepaid and commercial payments. The Company has three business operations: transaction processing services, product platforms and payments network management. VISA USA: Parties in Calif. Lawsuit Engage in Settlement Talks -------------------------------------------------------------- Parties in a purported consumer and merchant class action, which was filed with the California state court against Visa U.S.A., Visa International, MasterCard, Merrick Bank, and CardSystems Solutions, Inc., are engaged in settlement negotiations. The complaint, filed on June 27, 2005, stems from a data- security breach at CardSystems, a payment card processor that handled Visa and other payment brand transactions. It alleges that Visa U.S.A. and Visa Internationals failure to inform cardholders of the CardSystems breach in a timely manner constitutes an unlawful and unfair business practice under California's Unfair Competition Law and violates Californias statutory privacy-notice law. In August 2005, the court denied the plaintiffs application for a temporary restraining order, except with respect to the defendants retention of affected account-identifying information, and in September 2005 denied plaintiffs motion for a preliminary injunction. Also in September 2005, the court dismissed the claims brought by the merchant class. On Nov. 18, 2005, the defendants answered the remaining claims. Limited discovery occurred. CardSystems filed for bankruptcy in U.S. District Court for the District of Arizona in May 2006, staying the litigation as to it. The plaintiffs removed the case to U.S. District Court for the Northern District of California on Aug. 10, 2006, and then sought to transfer the case to federal court in Arizona. Visa U.S.A., Visa International and MasterCard moved for remand to state court. On Oct. 11, 2006, the court granted the defendants motion for remand and denied the plaintiffs motion to transfer the case. Proceedings involving CardSystems continue in the bankruptcy court in Arizona, and the California state court plaintiffs appear to be pursuing claims against CardSystems in that forum. The state court in California has not set discovery deadlines or a trial date. The parties are currently engaged in settlement negotiations, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. Visa, Inc. -- http://www.corporate.visa.com-- is a retail electronic payments network. The Company facilitates global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses and government entities. Its primary customers are financial institutions, for which it provides processing services and payment product platforms, including platforms for consumer credit, debit, prepaid and commercial payments. The Company has three business operations: transaction processing services, product platforms and payments network management. VISA USA: Faces Litigation in Maryland Over Credit Card Fees ------------------------------------------------------------ Visa U.S.A., Inc. faces a putative class action that is pending with the U.S. District Court for the District of Maryland in connection to credit card fees, according to the company's Feb. 4, 2008 form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Dec. 31, 2007. On Nov. 13, 2007, a putative class action was filed with the Maryland state court against Visa U.S.A., MasterCard Worldwide, and Discover Financial Services. Plaintiff AAA Antiques Mall, Inc. alleges that credit card fees assessed by defendants as to the state tax portion of a sales transaction constitute unjust enrichment and intentional misrepresentation. On Jan. 2, 2008, Visa U.S.A. removed the case to U.S. District Court for the District of Maryland. At this time, it is too early to make any reasonable evaluation of the claims alleged. The suit is "AAA Antiques Mall, Inc. v. Visa USA, Inc. et al., Case No. 1:08-cv-00006-JFM," filed with the U.S. District Court for the District of Maryland, Judge J. Frederick Motz presiding. Representing the defendants are: Michael Louis Bernstein, Esq. Arnold and Porter LLP 555 12th St NW Washington, DC 20004 Phone: 12029425000 Fax: 12029425999 e-mail: michael.bernstein@aporter.com - and - Joseph William Hovermill, Esq. Miles and Stockbridge PC 10 Light St. Baltimore, MD 21202-1487 Phone: 14107276464 Fax: 14103853700 e-mail: jhovermill@milesstockbridge.com WACHOVIA CORP: Faces Penna. Lawsuit Alleging Telemarketing Fraud ---------------------------------------------------------------- Wachovia Corp. is facing a class-action complaint filed last month with the U.S. District Court for the Eastern District of Pennsylvania accusing it of letting fraudulent telemarketers use its accounts to milk millions of dollars from consumers, Reuters' Jonathan Stempel reports. In court papers filed Jan. 17, the plaintiffs accused Wachovia and its in-house lawyers of knowing "for several years" that the bank could be legally liable for dealing with fraudulent telemarketers. According to the report, the plaintiffs accused Wachovia of allowing some "payment processors" to create unsigned checks on behalf of telemarketers to withdraw funds from victims between 2003 and 2006. The United Press International asserts that despite warnings, Wachovia bank kept working with telemarketers who were using unauthorized checks to steal millions. Court documents showed that plaintiffs also accused Wachovia of trying to win or retain business from companies that it knew were accused of telemarketing fraud, despite being alerted by other banks about the deceptive activity. Plaintiffs are seeking class-action status on behalf of at least 346,000 victims they say lost millions of dollars. Internal Wachovia e-mail messages allegedly show that executives knew some accounts had crossed banking standard thresholds and, yet, frequently didn't close the accounts, The New York Times reported. According to the Reuters report, bank spokeswoman Christy Phillips-Brown declined to comment on the lawsuit, but said, "We took this issue very seriously, and senior management, led by CEO Ken Thompson, was actively involved in directing aggressive steps to correct the processes related to the situation." She also said that the Charlotte, North Carolina-based bank has taken steps to implement new risk management for third-party payment processors and telemarketers. Ms. Phillips-Brown said Wachovia "does not have customers who are strictly telemarketers, or who are third-party payment processors to telemarketers." Based in Charlotte, N.C., Wachovia Corp. provides commercial and retail banking and trust services through full-service banking offices. It also provides mortgage banking, investment banking, investment advisory, home equity lending, asset-based lending, leasing, insurance, international and securities brokerage services through its subsidiaries. WEST PUBLISHING: New Antitrust Lawsuit Filed in California ---------------------------------------------------------- A new antitrust class action lawsuit against West Publishing Corporation -- dba BAR/BRI -- and Kaplan, Inc., was filed with the U.S. District Court for the Central District of California in Los Angeles. The lawsuit accuses the two companies of illegally dividing their highly lucrative LSAT and bar exam test preparation businesses. According to the complaint, executives of BAR/BRI and Kaplan secretly agreed to a per se illegal market division, which, in part, involved BAR/BRI annually paying to Kaplan substantial sums to keep it out of its bar review course market. The Complaint further alleges that BAR/BRI has engaged for decades in an overall scheme to monopolize the relevant market, by committing a litany of antitrust violations. According to the Complaint, BAR/BRI interfered with and prevented competitors� entry or expansion in the relevant market by buying them out, threatening them, spreading false rumors about them, and even breaking into their offices to steal competitively significant records. The Complaint also states that BAR/BRI has engaged in the continuing practice of tearing down, otherwise removing, or preventing the posting of, the signs, placards and related promotional materials of local bar review course competitors at various law schools. Without substantial competition, BAR/BRI's net price per student increased steadily over the years throughout the U.S. Class Representatives: -- Stephen Stetson, -- Shane LaVigne, -- Christina Brown-Roberts, -- Valentin Karpenko, and -- Jake Fathy are suing on behalf of about 80,000 law students and 40,000 recent BAR/BRI customers to recover injunctive relief and damages. The lawsuit proposes two classes: -- Class A consists of individuals who have paid for a BAR/BRI course since July 1, 2006, or will do so prior to the time any injunctive relief is fully implemented by the Court. -- Class B consists of law students who have not yet paid in full for a BAR/BRI course, but will have little choice but to purchase such a course when they graduate from law school, as soon as in 2008. Mr Stetson and Mr. LaVigne are designated as representatives of Class A, and Ms. Brown-Roberts, Mr. Karpenko, and Mr. Fathy are designated the representatives of Class B. Representing the plaintiffs are The Disner Law Corporation and Harris & Ruble, both of Los Angeles, California. The lead attorney is antitrust trial lawyer Eliot G. Disner, who was also lead attorney in the federal case titled "Rodriguez v. West Publishing Corp CDCAL, Case No. 05-3222R." In that case, West's BAR/BRI and co-defendant Kaplan jointly agreed to pay $49 million to a class of some 300,000 BAR/BRI course students who overpaid between 1997 and 2006 due to the anticompetitive practices of the two companies. Representing plaintiffs is: Eliot Disner, Esq. Disner Law Corporation 2029 Century Park East 19th Floor Los Angeles, CA 90067 Phone : 310-286-0600 Fax : 310-282-2585 e-mail: edisner@disnerlaw.com YAHOO INC: Faces Calif. Suit Over Microsoft's $45BB Buyout Offer ---------------------------------------------------------------- A federal class-action derivative lawsuit -- with clashing intentions -- has been filed against Yahoo! and its directors with the Superior Court of the State of California for the County of Santa Clara, stemming from Microsoft's $45-billion buyout offer, CourtHous