/raid1/www/Hosts/bankrupt/CAR_Public/080211.mbx             C L A S S   A C T I O N   R E P O R T E R

           Monday, February 11, 2008, Vol. 10, No. 29


BANK OF AMERICA: Calif. Consumer Sues Over "Live Check" Loans
CATHOLIC HEALTHCARE: Faces Labor Suit Filed by Mercy Workers
CHOCOLATE PRODUCERS: Merchant Law Files Suit Over Price Fixing
COLORADO: Governor Wants to be Co-Defendant in Property Tax Suit
CONEXANT SYSTEMS: Appeals Third Circuit Ruling in "Graden" Case

DELPHI CORP: Shareholders Drop Claims Against Advisers
FIRST COMMAND: Lawsuit Notices Sent to 179,000 Service Members
GOLDEN GATE: Faces Calif. Suit Over Park Access for the Disabled
HCC INSURANCE: Reaches Settlement for Tex. Securities Fraud Suit
HYDROFLO INC.: N.C. Court Sets April 10 Certification Hearing

IMERGENT INC: Hearing on $2.8M Settlement Slated for March 19
INDIANA: BMC Faces Suit Over Revocation of Driver's Licenses
LEGAL AID: Morrison & Foerster Files Fake Legal Aid Scheme Suit
MARTEK BIOSCIENCES: Court Fixes April 4 Settlement Hearing
MEDTRONIC INC: Kirby McInerney Lead Counsel in Securities Suit

METRIS COS: March 25 Fairness Hearing Set for $7.5M Settlement
MONEY MANAGERS: Investor Lawsuit Over Fund Liquidation Looms
MONRO MUFFLER: Faces Suit in N.Y. Alleging Wage, Hour Violations
NORTHWEST AIRLINES: Files Countersuit in Fuel Surcharge Action
OHIO: Judge Gives Sex Offenders Time to Oppose Reclassifications

PANTRY INC: Seeks Dismissal of Multiple "Hot Fuel" Lawsuits
QANTAS AIRWAYS: Flight Centre Backs Out from Price-Fixing Suit
SPRINT NEXTEL: Faces Ill. Suit for Defrauding Wireless Consumers
TEXAS: Circuit Upholds Dismissal of Lawsuit v. City of Palestine
TUESDAY MORNING: No Trial Date Set for Labor Calif. Litigation

UNITED STATES: Officials Sued Over U.S.-Mexico Security Fence
W.R. GRACE: Court Sides with Grace in 401(K) Plan Suit


BANK OF AMERICA: Calif. Consumer Sues Over "Live Check" Loans
A California consumer has filed a proposed class action against
Bank of America and MBNA Corporation for making knowingly false
and misleading statements in their "live check" loan
solicitations which intentionally concealed numerous fees and

The lawsuit exposes the banks' deceptive efforts to induce
consumers to open or draw upon a line of credit via a Live Check
Loan Offer (i.e., access checks, convenience checks or balance
transfer checks).

"Big banks are deceptively hiding fees and charges from
unsuspecting consumers in a classic bait and switch," said Azra
Z. Mehdi of Coughlin Stoia Geller Rudman & Robbins LLP.  "The
banks' false and misleading claim that these checks are 'just
like any other' is designed to trick consumers."

The complaint alleges that the banks falsely claim that the
check sent to consumers is "just like any other check" and is
usable immediately, using language such as "Valid Immediately,"
"Act Now," "Do It Now," "Use Today," or "Don't Wait," among
others, to suggest that customers need simply to write the
check.  The banks also misleadingly state that recipients can
"borrow up to the full amount" available in the "live check,"
according to the complaint.

However, the banks fail to disclose in these solicitations that
their proposed extension of credit is subject to a number of
hidden conditions and fees, including a credit evaluation and
possible resulting credit denial that does not occur until after
the customer has already relied upon defendants' representation
of available credit and has then endorsed, cashed, deposited, or
otherwise attempted to negotiate the "live check."

The complaint also alleges that the defendant banks' Live Check
Loan Offer falsely suggests that checks may be used up to a
certain amount, when in fact using the checks for the stated
amount will result in defendants declining to honor the check
and imposing undisclosed additional fees or charges.

The defendants' unlawful, unfair, and fraudulent business
practices, have caused consumers to lose money via returned
check charges, overdrawn account charges, increased interest
rates or other fees and charges.

The proposed class action covers the period of October 14, 2001
to the present. The case is currently pending in the Northern
District of California before the Honorable Charles Breyer.

For more information, contact:

          Dan Newman
          Coughlin Stoia Geller Rudman & Robbins LLP
          Phone: (800) 449-4900
          e-mail: dnewman@csgrr.com

CATHOLIC HEALTHCARE: Faces Labor Suit Filed by Mercy Workers
Sacramento Mercy employees commenced a class-action lawsuit with
the San Francisco Superior Court against Catholic Healthcare
West, claiming that CHW owes them money because they were not
allowed to take meal and rest breaks, The Sacramento Bee

The three plaintiffs are:

         1. Rhonda Cherin
         2. Joanne Underwood
         3. Patricia Thomas

The plaintiffs also want back pay for thousands of other CHW
nurses and medical technicians working at the hospital system.
The San Francisco-based CHW, SacBee's Gilbert Chan explains, is
the parent of the Sacramento-area Mercy hospitals.  CHW employs
50,000 workers at 42 state hospitals and medical centers.

The suit seeks compensation for current and former CHW workers
since January 2004, alleging that employees "were regularly
required to work through their daily meal . . . period without
CHW compensating them."

In a statement, CHW officials said: "CHW is committed to
providing our employees with the work environment, tools and
resources they need to provide excellent care.  We strive to
provide meal and rest periods consistent with law."

Mr. Chan writes that a rash of litigation has been filed over
back pay for missed breaks, following an April ruling by the
state Supreme Court that expanded the penalties and shifted
legal expenses.

Sutter Health and state labor officials are conducting an audit
of payroll and time cards of about 4,500 employees at five
Sacramento-area hospitals.  The report says that this audit
could lead to a multi-million-dollar payout.

SacBee explains that under the law, workers must receive a 10-
minute rest period every four hours and a 30-minute meal break
for every five hours of work.  Employers must compensate workers
for an hour's pay every day the law is violated.  A violation
occurs if the rest break is not taken within the fourth hour and
the meal within the fifth -- even if the worker takes the break
later in the shift.

According to the report, no wage claims have been filed against
Mercy or CHW with the state.  Workers can pursue four years of
back pay in a lawsuit, but only three years through the state.

Chad Schwartz, Esq., attorney for the Mercy workers, told SacBee
that more than 100 CHW nurses and medical technicians have
contacted him.

The plaintiffs are represented by:

          Chad A. Schwartz, Esq.
          Rust, Armenis, Schwartz Lamb & Bills A Professional
          4380 Auburn Boulevard
          Sacramento, CA 95841
          Phone: (916) 972-8300
          Fax: (916) 972-7878
          e-mail: chadallan@aol.com

CHOCOLATE PRODUCERS: Merchant Law Files Suit Over Price Fixing
The Merchant Law Group LLP is inviting all chocolate consumers
to join a class-action lawsuit based on allegations that
chocolate producers -- namely, Hershey, Mars, Nestle, and
Cadbury -- kept Canadian chocolate prices artificially high, The
Star Phoenix reports.

According to Star Phoenix, the "Chocolate Makers Class Action"
comes in the wake of an alleged conspiracy currently being
investigated by authorities.

The report recounts that six months ago, an anonymous company
approached the Canadian Competition Bureau and sought immunity
from prosecution in exchange for information on an alleged
scandal involving consumer pricing of chocolate in the country.
The anonymous company provided testimony from one of its top
executives and other employees, as well as correspondence in
connection with a high-level price-fixing scandal within the

Subsequently, the bureau began the ongoing investigation into
the offices of Hershey's, Mars, Nestle, as well as food
distributor ITWAL, in November.

Evatt Merchant, the lawyer heading the class action, said that
the chocolate companies allegedly worked together to inflate
market prices in a manner contrary to Canadian competitive

Mr. Merchant encourages any consumer that has purchased a
chocolate bar or any related product to get involved with the
suit.  It's not likely consumers will receive compensation for
every Smartie, Kit Kat, or chocolate kiss, but Merchant said
there is a possibility that the companies will be forced to sell
their goods at below-market prices for a certain period if they
win their case.

For more information about the class-action lawsuit, contact:

          Tony Merchant, Q.C.
          Phone: (888) 567-7777
                 (877) 359-7777
          e-mail: merchant@merchantlaw.com

               - or -

          The Merchant Law Group LLP
          Web site: http://www.merchantlaw.com/

COLORADO: Governor Wants to be Co-Defendant in Property Tax Suit
Gov. Bill Ritter is seeking to become a co-defendant in a class
action filed by the Mesa County Commission and others to
overturn his controversial property tax, education-funding law
known as Senate Bill 199, Nike Saccone and Le Roy Standish of
The Daily Sentinel reports.

In a motion filed earlier this month with a Denver district
court, Gov. Ritter has asserted his right to defend the 2007
state law in question because of his constitutional mandate to
enforce state laws.

Dubbed the "mill levy freeze," Senate Bill 199 prevents school
district property tax rates from falling when they otherwise
would.  Without the mill levy freeze, school district tax rates
would fall to compensate for increases in the properties'

In his motion to become a co-defendant, Gov. Ritter argues that
if the court rules that the law is unconstitutional under the
Taxpayers' Bill of Rights, which requires voter approval of all
tax increases, "it would significantly affect the state's
education and fiscal interests," according to The Daily Sentinel

Mark Grueskin, Esq., a private attorney representing the
governor's office, explains that his client has requested to
intervene in the case to make sure that the correct agency is
the target of the lawsuit, not just the Colorado Department of

Mr. Grueskin pointed out that "the state has an interest in
defending the constitutionality of the legislation the General
Assembly passed and the governor signed."  He also pointed out
that his client's motion merely argues that the governor is
better positioned to defend against the lawsuit than the
Colorado Department of Education.

The Daily Sentinel reports that the Mesa County Commission
entered the lawsuit back in November 2007.  It was originally
initiated by the conservative Independence Institute, arguing
the mill levy freeze forced certification of incorrect school
district tax rates.

For more details, contact:

          Mark G. Grueskin, Esq.
          Isaacson, Rosenbaum, P.C.
          633 Seventeenth Street, Suite 2200
          Denver, CO 80202
          Phone: (303) 256-3941
          Fax: (720) 974-7970

CONEXANT SYSTEMS: Appeals Third Circuit Ruling in "Graden" Case
Conexant Systems, Inc. appealed to the U.S. Supreme Court a
ruling entered by the U.S. Court of Appeals for the Third
Circuit in which it vacated an order dismissing a purported
class action against the company.  The class-action lawsuit
alleges violations of the Employee Retirement Income Security

On February 2005, the company and certain of its current and
former officers and the company's Employee Benefits Plan
Committee were named as defendants in the lawsuit.  It was filed
on behalf of all persons who were participants in the company's
401(k) Plan during a specified class period.

The suit alleges that the defendants breached their fiduciary
duties under ERISA, as amended, to the Plan and the participants
in the Plan.  The defendants believe these charges are without
merit and intend to vigorously defend the litigation.  

The plaintiffs filed an amended complaint on Aug. 11, 2005.  On
Oct. 12, 2005, the defendants filed a motion to dismiss the

On March 31, 2006, the judge dismissed the case and ordered it
closed.  The plaintiffs filed a notice of appeal on April 17,

The appellate argument was held on April 19, 2007.  On July 31,
2007, the U.S. Court of Appeals for the Third Circuit vacated
the District Court's order dismissing the Graden complaint and
remanded the case for further proceedings.

On Nov. 17, 2007, the defendants filed a Renewed Motion to
Dismiss with the U.S. District Court for New Jersey.  

On Dec. 4, 2007, the defendants also filed a petition for
certiorari in the U.S. Supreme Court with respect to the Third
Circuit Court of Appeals ruling, according to the company's
Feb. 5, 2008 form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended Dec. 28, 2007.

The suit is "Graden v. Conexant Systems, Inc., et al., Case No.
3:05-cv-00695-SRC-TJB," filed with the U.S. District Court for
the District of New Jersey under Judge Stanley R. Chesler, with
referral to Judge Tonianne J. Bongiovanni.  

Representing the plaintiffs is:

         Lisa J. Rodriguez, Esq.
         Trujillo Rodriguez & Richards, LLP
         8 Kings Highway
         West Haddonfield, NJ 08033
         Phone: (856) 795-9002
         e-mail: lisa@trrlaw.com

Representing the defendants is:

         Gregory B. Reilly, Esq.
         Lowenstein Sandler, PC
         65 Livingston Ave.
         Roseland, NJ 07068-1791
         Phone: (973) 597-2500
         e-mail: greilly@lowenstein.com

DELPHI CORP: Shareholders Drop Claims Against Advisers
The Class Action Reporter reported on Jan. 15, 2008, that U.S.
District Judge Gerald Rosen approved, on a final basis, the
$284.1-million settlement of a class action filed by
investors against bankrupt auto-parts maker Delphi Corp.

Judge Rosen also approved a separate $47-million settlement for
current and former employees who invested in Delphi through
their retirement plans.  The settlements will require approval
from the bankruptcy court.

The lead plaintiffs in the shareholder class include the
Mississippi Public Employees Retirees System and the Teachers
Retirement System of Oklahoma.

According to an update from The Detroit News, the shareholder-
plaintiffs have also decided not to seek a judgment against
Delphi's advisers.

According to Feb. 1, 2008 filing with the U.S. District Court
for the District of Detroit, the investors dismissed claims
against BBK Ltd ., SETECH Inc . and JPMorgan Chase & Co., which
represented the shareholders.

With the dismissal, all class-action securities fraud cases
involving Delphi have been resolved, said Hannah Greenwald,
Esq., of Bernstein Litowitz Berger & Grossmann LLP of New York.

Representing some of the plaintiffs are:

         Cari C. Laufenberg, Esq.
         Keller Rohrback
         1201 Third Ave., Suite 3200
         Seattle, WA 98101
         Phone: 206-623-1900
         Fax: 206-623-3384
         e-mail: claufenberg@kellerrohrback.com

              - and -

         Sara L. Madsen, Esq.
         Lockridge Grindal
         100 S. Washington Ave., Suite 2200
         Minneapolis, MN 55401
         Phone: 612-339-6900
         Fax: 612-339-0981
         e-mail: slmadsen@locklaw.com

Representing the company are:

         Stuart Baskin, Esq.
         Shearman & Sterling
         599 Lexington Ave.
         New York, NY 10022
         Phone: 212-848-4000
         Fax: 212-848-7179
         e-mail: sbaskin@shearman.com

              - and -

         Joseph E. Papelian, Esq.
         Delphi Corporation Legal Staff,
         5825 Delphi Drive
         Troy, MI 48098-2815
         Phone: 248-813-2000
         e-mail: joseph.e.papelian@delphi.com

FIRST COMMAND: Lawsuit Notices Sent to 179,000 Service Members
Claims administration company Gilardi & Co., LLC, has mailed
class-action notices to about 179,000 current, retired and
former service members who qualify to be part of a lawsuit
against First Command Financial Planning, Air Force Times

As reported in the Class Action Reporter on Oct. 1, 2007, Judge
Irma Gonzalez of the U.S. District Court for the Southern
District of California certified as class action the suit filed
against First Command Financial Planning.

The lawsuit is the consolidation of two complaints filed in
January 2005 against First Command Financial Planning in federal
courts in California and Kentucky.  The suit -- filed by two
soldiers and their spouses, and two sailors -- accuses First
Command of using deceptive practices to lure military personnel
to invest in a 10- to 15-year plan that allegedly reaped
billions for the firm at the expense of military personnel.

According to Air Force Times, the plaintiffs seek a refund of
the 50% sales load that each paid during the first year they
owned a systematic investment plan through First Command.

The report says those who want to be included in the class-
action lawsuit do not have to take any action after receiving
the notice.  Attorneys representing service members in the suit
will prosecute the claims at no expense to members of the class.
If any benefits are obtained as a result of the class action,
those in the class will be entitled to share in them after
deductions for costs and legal fees.

However, if the court rules against the class, members will be
bound by that ruling, and any legal rights against First Command
will be terminated, the report notes.

Air Force Times says that First Command denies that it used any
devices, schemes or artifices to defraud or engage in any acts
or practices that operated as fraud.  The company also contends
that investors are barred from recovering fees in court because
the systematic investment plan sales loads were disclosed to
them beforehand and that investors assumed the risk of any loss
based on advisory documents provided to them.

The plaintiffs contend that First Command entered into a
settlement with the NASD (now the Financial Industry Regulatory
Authority) that made restitution to clients who started and
ended their investment plans within a five-year period but
failed to look after the interests of current clients.

Under the terms of the Dec. 15, 2004 settlement, First Command
did not admit or deny any wrongdoing but agreed to pay a
$12-million fine, $4 million of which was set aside to pay
restitution to those who opened and closed a systematic
investment plan between Jan. 1, 1999, and Dec. 15, 2004, and who
paid an effective sales charge of more than 5 percent.

Almost two weeks before the NASD settlement was finalized, First
Command announced it would no longer sell systematic investment
plans and would seek to expand its client base beyond the
military community.

Those eligible to take part in the suit must meet these three

   1. They must have made a systematic investment plan payment
      and paid a 50% sales charge on the money placed into the
      plan through First Command during the period from Jan. 31,
      2000, through Dec. 31, 2004.  That includes initial
      investments, as well as increasing an investment on an
      existing SIP during that time and having paid 50% on the
      increased amount;

   2. They must have still owned the systematic investment plan
      on Dec. 15, 2004; and

   3. They must not have terminated their plans within 45 days
      of purchase in order to receive a full refund of the sales

Service members who do not want to be included in the class-
action lawsuit for any reason can fill out an opt-out form.  It
must be postmarked by March 21, 2008, with full name, address
and signature.

People also can send a written statement noting: "I do not want
to be a part of the plaintiff class in McPhail v. First Command,
No. 05cv0179 IEG (JMA)."  The request should be signed, with
name and address printed below the signature, and mailed to:

          First Command Litigation
          Class Administration c/o Gilardi & Co.
          P.O. Box 8060
          San Rafael, CA 94912-8060.

Questions about the notice should be addressed to the claims
administrator or the class counsel, or by calling toll-free
(866) 511-8879.

Those who think they are eligible to participate in the class
action but have not received a notice can request it through the
toll-free number or the Web site.  Requests can also be mailed
to the post office box listed above, as well as other
correspondence or address changes.

Representing the plaintiffs is:

          Blumenthal & Nordrehaug
          2255 Calle Clara
          La Jolla, CA 92037
          Phone:  (858) 551-1223
          Fax: (858) 551-1232
          e-mail: bam@bamlawlj.com
          Web site: http://www.bamlawca.com/

GOLDEN GATE: Faces Calif. Suit Over Park Access for the Disabled
The Golden Gate National Recreational Area and the National Park
Service face a class action filed with the U.S. District Court
for the Northern District of California, which accuses them of
discriminating against individuals with disabilities by denying
them access to GGNRA parks.  

The lawsuit was filed by the Disability Rights Advocates on
Jan. 31, 2008.  It was brought on behalf of all people with
mobility and vision disabilities who have been denied access to
GGNRA parks.

Aside from GGNRA and NPS, other defendants in the suit include:

       -- Brian O'Neill, General Superintendent of GGNRA; and

       -- Mary Bomar, Director of NPS.

GGNRA has been obliged to provide reasonable accommodations for
persons with disabilities, since the passage of the
Rehabilitation Act of 1973.

Spanning over 75,000 acres of land and water from San Mateo to
Marin County, GGNRA is the country's largest national park in an
urban area and attracts more than 13 million visitors a year.  
The park includes national landmarks as Alcatraz, the Presidio,
the Marin Headlands, Muir Woods, Crissy Field, and Forts Point
and Mason.  It contains 1,273 plant and animal species,
encompasses 59 miles of bay and ocean shoreline, and has
military fortifications that span centuries of California
history from the Spanish conquistadors to Cold War-era Nike
missile sites.

"What makes this case especially frustrating," said Laurence
Paradis, executive director of DRA, "is that we have been
working in good faith with the GGNRA for over a year in an
effort to achieve a plan to bring this agency into compliance
with federal law.  In the end, all we obtained was another year
of delayed access for people with disabilities."

DRA attorney Julia Pinover, Esq., echoed the sentiment, "This is
not rocket science.  We're not seeking accessibility in the most
remote part of the Amazon, we're talking about long overdue
accessible restrooms, visitors' centers, parking, exhibits,
trails and programs in the San Francisco Bay Area.  This case is
really about how our national parks systematically exclude
people with disabilities and, in doing so, fail to fulfill our
local and national policy of inclusion."  

Although access requirements took effect in 1973, now, in 2008,
GGNRA still does not provide basic accommodations to allow

Plaintiff Lori Gray, a wheelchair user with a visual impairment,
organizes and leads outdoors trips for groups of people with
various disabilities to facilitate outdoor experiences and the
enjoyment of the natural wonders of the Bay Area.  Ms. Gray
stated, "It's astonishing that decades after the Rehabilitation
Act was passed, the GGNRA still won't make the most basic
accommodations, never mind considering the possibility that
groups of people with disabilities might occasionally travel
together and need group accommodations."

Co-plaintiff Ann Sieck, like many Bay Area residents, has a
life-long love of the outdoors and is frustrated that she cannot
enjoy what GGRNA has to offer.  Ms. Sieck said, "The pervasive
access barriers discourage people with disabilities and their
families from visiting the parks.  I think many people have just
given up."

The suit is "Gray et al v. Golden Gate National Recreational
Area et al., Case No. 3:08-cv-00722-EDL," filed with the U.S.
District Court for the Northern District of California, Judge
Elizabeth D. Laporte presiding.

Representing the plaintiffs is:

          Laurence Wayne Paradis, Esq.
          Disability Rights Advocates
          2001 Center Street, 3rd Floor
          Berkeley, CA 94704-1204
          Phone: 510-665-8644
          Fax: 510-665-8511
          e-mail: larryp@dralegal.org

HCC INSURANCE: Reaches Settlement for Tex. Securities Fraud Suit
HCC Insurance Holdings, Inc. has reached a settlement, subject
to court approval, with the plaintiffs in a class action
litigation relating to the Company's historic stock option
granting practices.

The terms of the settlement, which includes no admission of
liability or wrongdoing by HCC or any other defendants, provide
for a full and complete release of all claims in the litigation
and payment of $10 million to be paid into a settlement fund,
pending approval by the Court of a plan of distribution.  The
amount will be paid by the Company's directors' and officers'
liability insurers, and will not have a material effect on HCC's
financial results.

The suit, "Bristol County Retirement System v. HCC Insurance
Holdings Inc et al., Case No. 4:07-cv-00801," was filed on
March 8, 2007.  The company is named as a defendant in the
putative class action along with certain current and former
officers and directors.

The plaintiff seeks to represent a class of persons who
purchased or otherwise acquired the company's securities between
May 3, 2005, and Nov. 17, 2006, inclusive.

The action purports to assert claims arising out of improper
manipulation of option grant dates, alleging violation of
Sections 20(a) and 10(b) of the U.S. Securities Exchange Act, as
well as Rule 10b-5 promulgated thereunder.

The plaintiff also purports to assert a claim for violation of
Section 14(a) of the U.S. Securities Exchange Act and Rules 14a-
1 and 14a-9 promulgated thereunder.  The plaintiff seeks
recovery of compensatory damages for the putative class and
costs and expenses.  

On Sept. 21, 2007, jointly with the other defendants,  the
company filed a motion to dismiss the suit.

On January 9, 2008, the company announced that it had reached a
settlement in the shareholder derivative litigation regarding
the stock option matter.  With the recent announcement, all
private securities litigation pending against the Company
regarding the stock option matter has been resolved.

Once approved, the settlement will resolve all class action
litigation pending against the Company, as well as its former
and current directors and officers.

"The settlement of this class action lawsuit is another step in
the direction of putting the entire option issue behind us. We
are now waiting to hear the Securities and Exchange Commission's
ruling on the option issue, which we hope will finally and
completely resolve the matter," HCC Chief Executive Officer
Frank J. Bramanti said.

The suit is "Bristol County Retirement System v. HCC Insurance
Holdings Inc. et al., Case No. 4:07-cv-00801," filed with the
U.S. District Court for the Southern District of Texas under
Judge Sim Lake.

Representing the plaintiff is:

         Damon Joseph Chargois, Esq.
         Chargois & Heron LLP
         2201 Timberloch Place, Ste. 110
         The Woodlands, TX 77380
         Phone: 281-444-0604
         Fax: 281-440-0124
         e-mail: damon@cmhllp.com

              - and –

         Alan I. Ellman, Esq.
         Labaton Sucharow & Rudoff
         100 Park Avenue
         New York, NY 10017
         Phone: 212-907-0813
         Fax: 212-818-0477
         e-mail: aellman@labaton.com

Representing the defendant is

         Barry F. McNeil, Esq.
         Haynes and Boone
         901 Main St., Ste. 3100
         Dallas, TX 75202-3789
         Phone: 214-651-5580
         Fax: 214-200-0535
         e-mail: barry.mcneil@haynesboone.com

HYDROFLO INC.: N.C. Court Sets April 10 Certification Hearing
The United States District Court for the Eastern District of
North Carolina has set a certification hearing -- for the
purposes of the $425,000 in cash plus accrued interest
settlement, pursuant to Rule 23 of the Federal Rules of Civil
Procedure -- on April 10, 2008 at 10:30 a.m. for the lawsuit
"Russell Todd Huttenstine et al. v. Dennis Mast et al., Case No.

The proposed class includes all persons who acquired the common
stock of HydroFlo, Inc. during the period from July 18, 2005,
through and including Oct. 26, 2005.

Deadline to file for exclusion and objection is on March 13,
2008.  Deadline to file claims is on April 28, 2008.

The United States District Court for the Eastern District of
North Carolina will hold a hearing on April 10, 2008, at
10:30 a.m. in the courtroom of the Honorable James C. Fox.

                        Case Background  

In 2005, the Rosen Law Firm P.A. filed a class action lawsuit on
behalf of all investors who purchased common stock of HydroFlo,
Inc. (OTC BB: HYRF) during the period from July 18, 2005 through
October 26, 2005, inclusive (Class Action Reporter, Nov. 28,

The complaint charges that the defendants violated sections
10(b) and 20(a) of the Exchange Act by issuing a series of false
and misleading press releases to the market during the Class

The complaint alleges that HydroFlo issued several materially
false and misleading press releases concerning the Company's
Metals & Arsenic Removal Technology, Inc. and Advance Water
Recycle Inc., wholly owned portfolio companies.

The complaint charges that the defendants misrepresented the
type, terms, amendments, demand, and revenue projections from
certain agreements between MARTI and EYI Industries and its
subsidiaries during the Class Period.  In addition, the
complaint alleges that defendants misrepresented the existence
and nature of certain agreements with government entities
involved in the Hurricane Katrina relief effort.

As a result of the Company's materially false and misleading
statements to the market, according to the complaint, the price
of HydroFlo stock was artificially inflated in the Class Period.

The suit is "Russell Todd Huttenstine et al. v. Dennis Mast et
al., Case No. 4:05-CV-00152-F(3)," filed with the United States
District Court for the Eastern District of North Carolina.

Lead Counsel for Plaintiffs are:

          Laurence Rosen, Esq.
          Phillip Kim, Esq.
          The Rosen Law Firm PA
          350 Fifth Avenue, Suite 5508
          New York, NY  10118
          e-mail: lrosen@rosenlegal.com

Liaison Counsel for Plaintiffs:

          Kevin Cartledge, Esq.
          Wilson & Coffey, LLP
          110 Oakwood Drive, Suite 400
          Winston-Salem, NC 27103
          e-mail: info@wilsoncoffey.com

Counsel for Defendants:

          Donald J. Harris, Esq.
          Harris, Winfield & Hodges, LLP
          255 Hillsborough Street, Suite 260
          Raleigh, NC 27603
          Web site: http://www.harriswinfield.com

               - and -

          L. Neal Ellis, Jr.
          Hunton & Williams LLP
          One Bank of America Plaza
          421 Fayetteville Street, Suite 1400
          Raleigh, NC 27601
          e-mail: nellis@hunton.com

IMERGENT INC: Hearing on $2.8M Settlement Slated for March 19
A March 19, 2008 final hearing was scheduled for the
$2.8-million settlement of a consolidated securities fraud class
action against iMergent, Inc.

                        Case Background

On March 8, 2005, an action was filed by Elliott Firestone, on
behalf of himself and all others similarly situated, against the
Company, certain current and former officers, and certain
current and former directors, with the U.S. District Court for
the District of Utah, Case No. 2:05cv00204 DB.  

Additional complaints were then filed against the Company
alleging similar claims.  The court ordered that the cases be
consolidated and on Nov. 23, 2005, allowed a "consolidated
amended complaint for violation of federal securities laws"
against the Company, certain current and former officers, and
certain current and former directors, together with the former
independent auditors for the Company, Grant Thornton LLP, as

The amended consolidated complaint alleges violations of federal
securities laws claiming that the defendants either made or were
responsible for making material misleading statements and
omissions, providing inaccurate financial information, and
failing to make proper disclosures which required the Company to
restate its financial results.  

The suit seeks unspecified damages, including attorneys' fees
and costs.

Although the action was determined by the court to be the
"consolidated action," a separate complaint was filed in October
2005 by Hillel Hyman, on behalf of himself and all others
similarly situated, against the Company, certain current and
former officers, certain current and former directors, and Grant
Thornton LLP.  This group in subsequent filings refers to itself
as the "accounting restatement group" and alleges that it should
be determined by the court to be the consolidated plaintiff as
it properly alleges a class period consistent with timing
necessary to raise a claim based upon the restatement of
financial results announced by the Company.  The second
complaint alleges violations of federal securities laws by the
Company and Grant Thornton LLP.

The Company disputes the allegations raised in both actions, but
has not filed substantive responsive pleadings.

On February 28, 2006, at a "Status Conference," the court
determined that the complaint filed by the accounting
restatement group should be substituted as the new consolidated
amended complaint.

On April 3, 2006, the court entered a consent order substituting
Mr. Hyman as the lead plaintiff.


On Sept. 19, 2007, the Company and the plaintiffs entered into a
Memorandum of Understanding (MOU) regarding settlement of all
claims in the litigation.  

The Company and the plaintiffs have filed a stipulation of
settlement seeking court approval of the terms.  

The MOU provides, in part, that:

       -- within 15 business days following the court’s
          preliminary approval of the settlement, defendants
          and/or their insurers shall pay $2,800,000 to the
          plaintiffs (the settlement payment is within policy
          limits of the directors and officers insurance policy
          maintained by the Company);

       -- the court order will include a provision dismissing
          the Company and individual defendants from the
          litigation with prejudice;
       -- the court order will include a provision that bars and
          enjoins Grant Thornton LLP from prosecuting any claims
          against the Company and individual defendants arising
          out of, or based upon, or related to the facts alleged
          in the complaint or that could have been alleged in
          the litigation;

       -- the Company and individual defendants shall assign to
          the  plaintiffs any and all claims or causes of action
          that they now have against Grant Thornton LLP,
          including, but not limited to, any claims or causes of
          action for accounting malpractice or breach of

       -- the Company and individual defendants shall cooperate
          with the plaintiffs in the continuing prosecution of
          the litigation against Grant Thornton LLP; and

       -- the Company is required to provide documentary
          evidence supporting the claims against Grant Thornton
          LLP to the plaintiffs.

The failure of the court to approve the terms, or the parties
not abiding by the terms of the MOU, will render the settlement
without any effect.  

The court has preliminarily approved the terms of the proposed
settlement and claims forms have been mailed to all affected
members of the class.  

A final hearing has been scheduled for March 19, 2008, according
to the company's Feb. 5, 2008 form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended Dec.
31, 2007.

The suit is "Hyman v. Imergent, et al., Case No. 2:05-cv-00861-
DAK," filed with the U.S. District Court for the District of
Utah under Judge Dale A. Kimball.  

Representing the plaintiffs are:

         C. Richard Henriksen, Jr., Esq.
         Henriksen & Henriksen
         320 S. 500 E.
         Salt Lake City, UT 84102
         Phone: (801) 521-4145
         e-mail: hhlaw@sisna.com

              - and -

         Ira M. Press, Esq.
         Kirby Mcinerney & Squire
         830 Third Ave.
         New York, NY 10022
         Phone: (212) 317-6600
         e-mail: ipress@kmslaw.com

Representing the defendants is:

         Jacqueline Benson, Esq.
         Gary F. Bendinger, Esq.
         Howrey, LLP
         Phone: (713) 654-7693 and (801) 533-8383
         e-mail: bendingerg@howrey.com

INDIANA: BMC Faces Suit Over Revocation of Driver's Licenses
Indiana's Bureau of Motor Vehicles faces a purported class
action that seeks to prevent the possible revocation of up to
56,000 driver's licenses that don't match information in a
Social Security database, WTHR-TV reports.

The American Civil Liberties Union filed the suit with the
Marion Superior Court on Feb. 8, 2008.  Ken J. Falk, Esq., an
attorney with the ACLU of Indiana filed the suit on behalf of
Lyn Leone, Esq., an attorney who lives in St. Joseph County.

In recent weeks, many individuals came under the threat of
losing their driver's licenses unless they reconcile
discrepancies in the way their names and other key information
are recorded by the state BMV and the federal Social Security
Administration, according to The Indianapolis Star.

WTHR-TV reports that many of the mismatches were created by
typographical errors or by people getting married and changing
their last names.

The BMV recently said that when it announced the errors, it had
sent warning letters to about 206,000 people in Indiana.  All
those affected by the mismatches were notified in November 2007,
and again a month later.  The BMV wanted the discrepancies
cleared up by Jan. 31, 2008.

Though many of the cases already have been resolved, the ACLU
pushed through with the lawsuit, seeking an injunction to make
sure no licenses are revoked without hearings.

For more details, contact:

          Kenneth J. Falk, Esq.
          ACLU of Indiana
          1031 E. Washington St.
          Indianapolis, IN 46202-3952
          Phone: (317) 635-4059 or (317) 635-4056
          e-Mail: kfalk@aclu-in.org

LEGAL AID: Morrison & Foerster Files Fake Legal Aid Scheme Suit
Law firm Morrison & Foerster LLP has brought suit with the U.S.
District Court for the District of Colorado against several
Colorado entities and individuals allegedly engaged in a
nationwide attempt to defraud consumers of legal services.  The
case is being brought on behalf of Colorado Legal Services and
Texas RioGrande Legal Aid, Inc., both non-profit agencies that
provide free civil legal services to indigent residents of their
respective states.  

Named defendants include Legal Aid National Services, which does
business as LANS Corp. of Aurora, Colorado, along with more than
a dozen other entities with similarly deceptive names, including
Legal Aid National Paralegal Services Division, Inc., Legal Aid
Low Cost Services Inc., and Legal Aid Services LLC.  Also named
are several individuals, some of whom are reportedly convicted

The complaint is an action for trademark infringement, false
advertising, unfair competition, racketeering, the unauthorized
practice of law, and violations of the Colorado Consumer
Protection Act and common law claims under Colorado, and Texas

According to the complaint, the defendants purport to offer
legal services through a so-called "attorney division" in 27
states, including California, Connecticut, Illinois, New York,
Ohio, New Jersey, Pennsylvania, Tennessee, Oklahoma, Oregon,
Maryland, North Carolina and Texas.  They also claim to offer
paralegal services in all states except Alaska.

CLS and TRLA are attempting to help a number of individuals who
contracted with various defendant organizations and claim to
have received "inadequate or incomplete services" -– and often
no service at all.  

      Representative Colorado Victims Demand for $800

Among those victimized in Colorado include Simone Jones, who
went in person to a LANS office in Denver and requested an
attorney to help her obtain spousal support from her husband,
who resides in Illinois.  Despite her payment of $475, LANS
failed to file or serve any of the divorce or support documents
for Ms. Jones.  As a result, her husband was able to file and
receive a decree from an Illinois court.

Another Denver-area resident, Karen Harris, contacted LANS
through the Yellow Pages, after her husband fell ill and the
couple fell behind on their mortgage.  Ms. Harris also went in
person to LANS offices in Colorado, to discuss bankruptcy and
avoiding foreclosure on her home.  LANS allegedly demanded $800,
$748 of which Ms. Harris paid in installments.  LANS did not
prepare or file any bankruptcy documents or provide services of
any kind for Ms. Harris, the complaint alleges.  Then, after
another request for an additional "$30 retaining fee," LANS
transferred her case to someone who claimed that his "hands were
tied" because LANS had not, in turn, paid him.  Ms. Harris faces
imminent foreclosure on her home.

          Texas Victims -- 411 Call Leads to Nowhere

The Texas victims include Kristy Matthijetz, of Travis County,
who was served with divorce papers by her husband's family while
he was in the hospital receiving treatment for a brain tumor.
Calling the local number for "Legal Aid, Inc." in the phone
book, she was allegedly told to wire $525 in order to be
assigned to an attorney who would represent her in proceedings
beginning the next day.  After the lawyer failed to show up in
court, Ms. Matthijetz lost custody of her daughter for two
weeks.  She is now represented by TRLA on her divorce and
custody matters.

Another woman, Isela Caldera of El Paso, sought to help her
father legally adopt his granddaughter after the child's mother,
Isela's sister, died.  Ms. Caldera obtained the local number for
"Legal Aid" by dialing 411.  The number she was given was
actually for LANS Corp.  According to the complaint, the
Calderas were told that Legal Aid was no longer free, and now
required payment of a "percentage fee."  Ms. Caldera provided
her check card number and paid a "reduced rate" of $415.  She
has not heard from anyone at LANS Corp. since September 2007,
when she says she was told the adoption papers would be filed.  
In fact, no papers were ever filed, and Mr. Caldera still does
not have legal custody of his granddaughter.  TRLA is currently
trying to place this case with a private attorney.  

Attorneys from Morrison & Foerster fear there may be many more
victims of this scheme.  According to the complaint, "Defendants
have been engaged in the foregoing practices for more than a
decade and continually reinvent themselves and their business
names in an attempt to defraud and confuse more consumers."

Describing the lucrative enterprise operated by the defendants,
the complaint adds, "In papers filed with the United States
Bankruptcy Court for the District of Colorado, witnesses claimed
that [one named individual] alone expected to earn $1.7 million
from Defendants' fraudulent businesses."

"The actions alleged in this case are highly disturbing," said
Morrison & Foerster New York litigation partner Alex Lawrence,
one of several attorneys at the firm working on the case pro
bono.  "Our complaint makes clear that not only have defendants
hijacked the names of legitimate legal services providers, but
they’ve done so in order to target individuals who are already
vulnerable, facing some of the most difficult personal crises of
their lives."

"Organizations such as Colorado Legal Services and Texas
RioGrande Legal Aid offer skilled, dedicated attorneys and
paralegals delivering much-needed services for clients in need,
many with limited financial resources and often facing critical
personal and family emergencies," added Jamie Levitt, another
Morrison & Foerster litigation partner handling the case.  "The
fact that poor and unsophisticated individuals assumed they were
dealing with a genuine provider of legal services means that
agencies such as CLS and TRLA have also been victimized in this
shell game.  We hope this new action exposes the wolf behind
sheep's clothing."

"For over 80 years, Colorado Legal Services has served the legal
needs of poor people in Colorado," said Jon Asher, Executive
Director of Colorado Legal Services.  "Colorado Legal Services
joined in this action because we think it is important to
investigate and protect low-income people from sham legal
services providers."

According to TRLA's Director of Communications, Cindy Martinez,
"Texas RioGrande Legal Aid is proud to have partnered with
Morrison & Foerster to investigate Legal Aid National Services
and the exploitation of Texans in need.  With their help, TRLA
will continue to provide quality legal services to the poor and
ensure that all Texans have access to justice."

In addition to damages and the disgorgement of the defendants'
"ill-gotten gains," plaintiffs are seeking injunctive relief
prohibiting defendants from both the unauthorized practice of
law, and the use of a name that in any way suggests association
with a legitimate legal aid organization.

The current complaint comes on the heels of a similar case filed
by Morrison & Foerster last year, challenging what the firm
alleged was a brazen fake "legal aid" scam targeting elderly and
often ill Californians facing eviction from their homes.  The
chief defendant in that case goes by the name "Legal Center for
Legal Aid."

Colorado Legal Services is represented by Faegre & Benson LLP,
of Denver, Colorado.

In addition to Mr. Lawrence and Ms. Levitt, Steven M. Kaufmann,
who chairs the firm's 500 lawyer Litigation Department, is
representing TRLA.  Sara D. Brin, Kelvin D. Chen, and Jonathan
C. Rothberg, associates from New York, and Nicole K. Serfoss,
associate from the Denver office, are also part of the
litigation team.  Representing Colorado Legal Services from
Faegre & Benson are Natalie Hanlon-Leh and Jared Briant.

                   About Morrison & Foerster

With more than one thousand lawyers in eighteen offices around
the world, Morrison & Foerster offers clients comprehensive,
global legal services in business and litigation.  The firm is
distinguished by its unsurpassed expertise in finance, life
sciences, and technology, its legendary litigation skills, and
an unrivaled reach across the Pacific Rim, particularly in Japan
and China.

For more information, visit http://www.mofo.com/or contact:

          Tania Zamorsky, Esq.
          Phone: (212) 262-7482     
          e-mail: tzamornyc@aol.com

          Allan Ripp, Esq.
          Phone: (212) 262-7477
          e-mail: arippnyc@aol.com

               - and -

          Frances Cosico, Esq.
          Phone: (415) 268-7986
          e-mail: fcosico@mofo.com

MARTEK BIOSCIENCES: Court Fixes April 4 Settlement Hearing
The U.S. District Court for the District of Maryland (Northern
Division) has certified as a class action the lawsuit titled  
"In Re Martek Biosciences Corp. (Ticker: MATK) Securities
Litigation, Civil Action No. MJG 05-1224," filed on behalf of      
individuals who purchased or acquired Martek common stock during
the period from Dec. 9, 2004, to April 28, 2005.

Moreover, a settlement for US$6,000,000 has been proposed.

A hearing will be held before Judge Marvin J. Garbis at
10:00 a.m. on April 4, 2008, to determine whether:

   1. the proposed Settlement should be approved by the Court as
      fair, reasonable, and adequate;

   2. the plaintiffs' co-lead counsel's application for an award
      of attorneys' fees and reimbursement of expenses should be

   3. the lead plaintiffs should be reimbursed for their
      reasonable costs and expenses (including lost wages)
      directly related to their representation of the Class in
      the litigation; and

   4. the claims against the defendants should be dismissed with

According to a Class Action Reporter report on Dec. 12, 2007,
the settlement will result in the dismissal of the claims
against Martek and all other defendants, subject to final court

Members of the Class who have not yet received the full printed
Notice of Proposed Settlement of Class Action and Motion for
Attorneys' Fees and Expenses, and Proof of Claim and Release
form may obtain copies of these documents by visiting
http://www.MartekSecuritiesSettlement.comor by contacting:

          Martek Biosciences Corp. Securities Litigation
          Claims Administrator
          c/o A.B. Data, Ltd.
          Post Office Box 170500
          Milwaukee, WI 53217
          (866) 963-9978

Accomplished claim forms must be submitted no later than May 15,
2008.  Deadline for submission of objections and requests for
exclusion from the Class is on March 21, 2008.

                        Case Background

On Nov. 18, 2005, a consolidated amended class action complaint
was filed with the U.S. District Court for the District of
Maryland on behalf of purchasers of the company's common stock
during the period beginning Dec. 9, 2004, and ending April 28,

The consolidated complaint alleges violations of Sections 10(b)
and 20(a) of the U.S. Securities Exchange Act of 1934, as
amended, and Rule 10b-5, promulgated thereunder, and violations
of Section 11 and 15 of the U.S. Securities Act of 1933, as

The consolidated complaint alleges generally that the company
and certain individual defendants made false or misleading
public statements and failed to disclose material facts
regarding its business and prospects in public statements the
company made or failed to make during the period and, in the
case of the U.S. Securities Act of 1933 claims, in the company's
January 2005 prospectus.

The company filed a motion to dismiss the consolidated
complaint, which the court dismissed on June 14, 2006.  The
court then entered a scheduling order for further proceedings in
the case.  

Subsequently, the parties stipulated to the dismissal of the
claims arising under the Securities Act of 1933, leaving only
the alleged violations of Section 10(b) and 20(a) of the U.S.
Securities Exchange Act of 1934 in the action.

On Sept. 20, 2006, the court approved the dismissal of the 1933
Act claims.  Additionally, on Sept. 21, 2006, the court approved
the parties' stipulation certifying a class to prosecute claims
under the U.S. Securities Exchange Act of 1934.

Subject to certain exceptions, the stipulated class generally
consists of all persons who either purchased Martek common stock
during the class period of Dec. 9, 2004, through April 28, 2005,
inclusive or otherwise acquired, without purchasing, Martek
common stock during the class period from a person or entity who
purchased those particular shares of Martek stock during the
class period.

The suit is "In re Martek Biosciences Corp. Securities
Litigation, Civil Action No. MJG 05-1224," filed in the U.S.
District Court for the District of Maryland under Judge Marvin
J. Garbis.   

The plaintiffs' co-lead counsel are:

          Katharine M. Ryan, Esq.
          Schiffrin Barroway Topaz & Kessler, LLP
          280 King of Prussia Road
          Radnor, PA 19087
          e-mail: kryan@sbtklaw.com  

               - and -

          Janine L. Pollack, Esq.
          Todd S. Kussin, Esq.
          Milberg Weiss LLP
          One Pennsylvania Plaza
          New York, NY  10119
          e-mail: jpollack@milbergweiss.com

The defendant is represented by:

          Steven F. Barley, Esq.
          Hogan and Hartson, LLP
          111 S. Calvert St., Ste. 1600
          Baltimore, MD 21202
          Phone: 14106592700
          Fax: 14105396981
          e-mail: sfbarley@hhlaw.com

MEDTRONIC INC: Kirby McInerney Lead Counsel in Securities Suit
The U.S. District Court for the District of Minnesota has
appointed Kirby McInerney, LLP to serve as lead counsel in the
securities class action lawsuit against Medtronic, Inc.

KM's client, a public pension fund, was appointed to serve as
lead plaintiff.

The Complaint, filed in 2007, charges Medtronic and certain of
its officers and directors with violations of the Securities
Exchange Act of 1934 (Class Action Reporter, Dec. 18, 2007).

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.

The plaintiff seeks to recover damages on behalf of class


          Ira Press, Esq.
          Peter Linden, Esq.
          Kirby McInerney, LLP
          Phone: (212) 371-6600
          e-mail: ipress@kmllp.com
          Web site: http://www.kmslaw.com

METRIS COS: March 25 Fairness Hearing Set for $7.5M Settlement
The U.S. District Court for the District of Minnesota will hold
a fairness hearing on March 25, 2008, at 10:00 a.m. for the
proposed $7,500,000 settlement in the matter, "In Re Metris
Companies Inc. Securities Litigation, Case No. 02-CV-3677

The hearing will be held before Judge James M. Rosenbaum at the
U.S. District Court for the District of Minnesota, 202 U.S.
Courthouse, 300 S. 4th Street, in Minneapolis, MN 55415.

Any objections or exclusions to and from the settlement must be
made on or before Feb. 28, 2008.  Deadline for the submission of
claims forms is on May 9, 2008.

                        Case Background

From Nov. 5, 2001 through July 17, 2002, Metris was a financial
services company that issued credit cards through its wholly
owned subsidiary, Direct Merchants Credit Bank, N.A.

The lawsuit alleges that defendants Metris, its then Chief
Executive Officer and Chairman of the Board Ronald N. Zebeck,
and its then Vice Chairman David Wesselink, intentionally or
recklessly misled investors through a series of material
misrepresentations and omissions concerning the business,
operations and financial condition of Metris in violation of the
Federal Securities laws.

These misstatements and omissions concerned, among other things:

       -- expectations for growth and profitability at Metris in
          2002, and earnings guidance related thereto;

       -- the negative impact an examination by the Office of
          the Comptroller of the Currency would have, and was
          having, on Metris' operations, financial condition and
          earnings; and

       -- undisclosed material changes in Metris' business model
          and lending practices.

The lawsuit further alleges that Defendants' misrepresentations
and omissions caused the price of Metris securities to be
artificially inflated, which resulted in monetary damage to
Class Members when Metris began to disclose its true financial
and operational condition.

The first securities class action complaint was filed in this
matter on Sept. 20, 2002.  

On March 5, 2003, the Court issued and filed an Order
Consolidating Actions, Appointing Lead Plaintiff, and Approving
Lead Plaintiff's Selection of Lead Counsel and Liaison Counsel.

On April 9, 2003, Lead Plaintiff filed a Consolidated Amended
Complaint.  Defendants moved to dismiss the CAC, and on July 14,
2003, after extensive briefing and oral argument, the Court
issued an Order denying Defendants' motion to dismiss in its
entirety.  Defendants answered the CAC on Aug. 18, 2003.

Thereafter, the parties engaged in extensive class and merits
discovery, as well as a significant amount of motion practice.
This discovery was extremely complicated and contentious,
involving many motions to compel and hearings before the Court.

The plaintiffs served, and responded to, multiple sets of
document requests, a myriad of interrogatories, and requests for
admissions.  The plaintiffs also served numerous third-party

As a result of the wide-ranging discovery efforts, the
plaintiffs obtained and analyzed hundreds of thousands of pages
of documents produced by the Defendants and third parties.  

The parties also deposed a total of nineteen percipient and
expert witnesses in locations throughout the U.S.

On Jan. 16, 2004, while discovery was continuing, plaintiffs
filed a motion for class certification.  Following briefing, the
Court heard oral argument, and on Nov. 30, 2004, Magistrate
Judge Franklin Noel issued his Report and Recommendation
recommending that the class be certified and that Michael Brody
Pettit be appointed class representative.

On Dec. 10, 2004, the Defendants filed their objection to the
Report.  Following briefing on the issue, Chief Judge Rosenbaum
issued an Order denying the Defendants' request for oral
argument and granting Plaintiffs' motion for class

On Jan. 21, 2005, the Defendants filed with the U.S. Court of
Appeals for the Eighth Circuit their petition for permission to
take an interlocutory appeal of Chief Judge Rosenbaum's grant of
class certification.  The Eighth Circuit issued its Judgment
denying Defendants' Petition on Feb. 4, 2005.

Following the completion of discovery, on Sept. 21, 2005, the
Defendants filed two separate motions for summary judgment.  On
Oct. 21, 2005, the plaintiffs filed an opposition to the Summary
Judgment Motions, and on Oct. 28, 2005, the Defendants filed
their reply briefs.  

On April 21, 2006, Chief Judge Rosenbaum granted Defendants'
Summary Judgment Motions.

On May 24, 2006, the plaintiffs filed a Notice of Appeal to the
Eighth Circuit.

Shortly thereafter, the Parties agreed to attend mediation
before Eighth Circuit Settlement Director John Martin and, on
July 26, 2006, the Parties, including the Court appointed Class
Representative, attended a full-day settlement conference in St.
Louis, Missouri.

While the Parties were unable to settle the Action on that date,
counsel for the Parties continued to negotiate and on or about
Aug. 21, 2006, the Parties reached an agreement in principle for
the Settlement of this Action.

For more details, contact:

          Metris Securities Litigation
          c/o Berdon Claims Administration LLC
          P.O. Box 9014
          Jericho, NY 11753-8914
          Fax: (516) 931-0810
          Web site: http://www.berdonclaims.com

          Patrice L. Bishop, Esq.
          Stull, Stull & Brody
          10940 Wilshire Boulevard, Suite 2300
          Los Angeles, CA 90024
          Phone: (888) 388-4605
          Fax: (310) 209-2087
          e-mail: Metris@SSBLA.com

               - and -

          Joseph H. Weiss, Esq.
          Joseph D. Cohen, Esq.
          Weiss & Lurie
          551 Fifth Avenue, Suite 1600
          New York, NY 10176
          Phone: (888) 593-4771
          Fax: (212) 682-3010
          e-mail: Info@WeissLurie.com

MONEY MANAGERS: Investor Lawsuit Over Fund Liquidation Looms
Barrister James MacFarlane is preparing to sue Money Managers on
behalf of investors over the liquidation of a group of funds
that left 7,000 investors owed NZ$457 million, The Dominion Post

Mr. MacFarlane, who is working with several law firms, told
Dominion Post that the class action would be to recover losses
from the First Step funds that were closed in October 2006.

First Step, the report recounts, was launched in 2000.  First
Step hit problems when changes in tax legislation introduced by
Finance Minister Michael Cullen in 2004 cut the products' growth
as its tax efficiency fell.  In November 2006, six trusts which
came under Money Managers' Five Steps umbrella were wound up
because more investors were quitting the trusts instead of
joining them.

So far, the company has paid out NZ$186.5 million, Dominion Post
says, but in December, investors received annual reports and a
letter from the trustee company stating that NZ$38 million had
been "written into the accounts," and that it was unlikely the
amount would be returned to the trust and to investors.  The
annual reports also stated that an additional NZ$108 million was
under "fundamental uncertainty."

Dominion Post notes that the annual reports showed significant
losses attributed to related-party transactions.

According to Dominion Post, Mr. MacFarlane declined to provide
detail on the causes of action, but hinted that they concerned
breach of duty and "deficiencies in the management and
supervision of the collective investment," arising partly from
conflicts of interest.  He also refused to disclose if Five
Steps trustee company Calibre Asset Services would be included
in the class action, but said all parties connected to the
scheme had been the subject to a "detailed analysis."

Mr. MacFarlane, the report notes, also hinted that legal issues
would be addressed on both sides of the Tasman, saying the
issues fell "squarely" within the jurisdiction of the Australian
Securities and Investment Commission, the Security Commission's
Australian counterpart.

He declined to comment on how many investors he represented or
when court papers would be filed, the report relates.

Money Managers spokesperson David Peach told Dominion Post that
the allegations are a "nonsense," and said that investors had
not lost money and funds managers were in the process of
realizing assets.  He added that the funds offered were under a
registered prospectus and that the laws have been complied with.

Mr. Peach also assured all investors that everybody is working
towards getting as much of the funds as they can back to them.

MONRO MUFFLER: Faces Suit in N.Y. Alleging Wage, Hour Violations
Monro Muffler Brake, Inc., faces a purported class action filed
with the Supreme Court of the State of New York that accuses it
of violating wage and hour laws.

The suit, filed on Dec. 19, 2007, is alleging that the Company
violated federal and state wage and hour laws relating to the
calculation and payment of overtime applicable to certain
information technology and other headquarters employees.  The
company considers these employees exempt from such laws.  

The plaintiffs are seeking unspecified monetary damages or
injunctive relief, or both, according to the company's Feb. 5,
2008 form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended Dec. 29, 2007.

Monro Muffler Brake, Inc. -- http://www.monro.com/-- is a chain  
of 698 company-operated stores and 14 dealer-operated stores
providing automotive under-car repair and tire services in the

NORTHWEST AIRLINES: Files Countersuit in Fuel Surcharge Action
Northwest Airlines Corp. filed a lawsuit with the U.S.
Bankruptcy Court in the Southern District of New York
(Manhattan) against the plaintiffs in a class action, saying
that they are violating the so-called automatic stay by
continuing a suit commenced before the airline's Chapter 11
filing, Bloomberg News reports.

The class action suit was filed with the federal court in
California, titled "Casteel v. Air New Zealand," seeking damages
for improper fuel surcharges.

Contending the class action is based on fares charged
before its bankruptcy, Northwest says the suit was halted
automatically by provisions in bankruptcy law that stop lawsuits
outside bankruptcy court and forcing all claims to be decided in
bankruptcy court, Bloomberg notes.

When Northwest emerged from Chapter 11 in May (concluding a 21-
month reorganization), the preclusion of lawsuits based on pre-
bankruptcy claims continued, the carrier argues.

According to Bloomberg, Northwest's lawsuit to stop the class
action in California gives U.S. Bankruptcy Judge Allan Gropper
the right to decide to what extent the pre-bankruptcy class-
action lawsuit is frozen if it pertains to ticket price policies
in effect during and after the reorganization.

OHIO: Judge Gives Sex Offenders Time to Oppose Reclassifications
Judge Patricia Gaughan of the U.S. District Court for the
Northern District of Ohio extended the deadline for sex
offenders to challenge their reclassification under a law that
took effect this year.

Specifically, Judge Gaughan stayed the community notification
provision in the Adam Walsh Child Protection Act for those who
weren't subject to it under the old law.

Under the law, offenders are automatically classified in one of
three tiers by their crime without considering the likelihood of

Judge Gaughan made the ruling in one of two class actions filed
by sex offenders or on their behalf.  In general, they claim
that the law denies them their constitutional right because
their classification can be changed without a hearing.

Recently, two purported class actions have been filed over
certain provisions in the Adam Walsh Child Protection Act.  One
lawsuit was filed with the U.S. District Court for the Northern
District of Ohio, while the other was filed with the Hamilton
County Common Pleas Court.

                       Federal Litigation

The federal suit, captioned, "Bell v. State of Ohio, Case No.
5:08-cv-00210-SL," was filed against the Ohio Attorney General's
Office, and Ohio's 88 county sheriffs (Class Action Reporter,
Feb. 1, 2008).

The Office of the Ohio Public Defender was among those who filed
the federal lawsuit against the state attorney-general's office,
and several county sheriffs.  

The suit over the new law was brought on behalf of all
individuals in the state whose sex offender classification
status has been changed by the new law.

It seeks a temporary court order preventing the new law from
being enforced until those affected by it can have
reclassification hearings and that the 60-day deadline for
challenging reclassifications be suspended.  

It also wants to prevent community notification from being
imposed on people retroactively.

                   Hamilton County Litigation

The case in Hamilton County was filed by the Ohio Justice and
Policy Center against the State of Ohio, claiming that new
requirements is unconstitutional, (Class Action Reporter,
Jan. 30, 2008).

The local legal watchdog group filed the suit on behalf of
convicted sex offender Jerome Sewell, and another unnamed female
sex offender.  They are seeking to stop the reclassification
under the law.  

For more details, contact

          Margie Slagle, Esq.
          Ohio Justice & Policy Center
          215 E. 9th St., Suite 601
          Cincinnati, Ohio 45202
          Phone: 513-421-1108
          Fax: 513-562-3200
          e-mail: contact@ohiojpc.org
          Web site: http://www.ohiojpc.org/

               - and -

          The Office of the Ohio Public Defender
          8 East Long Street - 11th Floor
          Columbus, Ohio 43215
          Phone: (614) 466-5394 or (800) 686-1573
          Web site: http://opd.ohio.gov/

PANTRY INC: Seeks Dismissal of Multiple "Hot Fuel" Lawsuits
The Pantry, Inc., is seeking for the dismissal of several
purported class actions over motor fuel that was greater than 60
degrees Fahrenheit at the time of sale.

Since the beginning of fiscal 2007, over 45 class-action
lawsuits have been filed with federal courts across the country
against numerous companies in the petroleum industry.  Major
petroleum companies and significant retailers in the industry
have been named as defendants in these lawsuits.  

To date, Pantry Inc. had been named as a defendant in seven

       -- one in Florida ("Cozza, et al. v. Murphy Oil USA, Inc.
          et al., S.D. Fla., No. 9:07-cv-80156-DMM," filed on
          Feb. 16, 2007);

       -- one in Delaware ("Becker, et al. v. Marathon Petroleum
          Company LLC, et al., D. Del., No. 1:07-cv-00136,"
          filed on March 7, 2007);

       -- one in North Carolina ("Neese, et al. v. Abercrombie
          Oil Company, Inc., et al., E.D.N.C., No. 5:07-cv-
          00091-FL,' filed on Match 7, 2007);

       -- one in Alabama ("Snable, et al. v. Murphy Oil USA,
          Inc., et al., N.D. Ala., No. 7:07-cv-00535-LSC," filed    
          on March 27, 2007);

       -- one in Georgia ("Rutherford, et al. v. Murphy Oil USA,
          Inc., et al., No. 4:07-cv-00113-HLM," filed on June 5,
       -- one in Tennessee ("Shields, et al. v. RaceTrac
          Petroleum, Inc., et al., No. 1:07-cv-00169," filed on
          July 13, 2007);

       -- one in South Carolina ("Korleski v. BP Corporation
          North America, Inc., et al., D.S.C., No 6:07-cv-03218-
          MDL," filed on Sept. 24, 2007).

Pursuant to an order entered by the Joint Panel on Multi-
District Litigation, all of the cases against the numerous
companies in the petroleum industry, including the seven in
which Pantry Inc. was named, have been or will be transferred to
the U.S. District Court for the District of Kansas where the
cases will be consolidated for all pre-trial proceedings.

The plaintiffs in the lawsuits generally allege that they are
retail purchasers who received less motor fuel than the
defendants agreed to deliver because the defendants measured the
amount of motor fuel they delivered in non-temperature adjusted
gallons which, at higher temperatures, contain less energy.  
These cases seek, among other relief, an order requiring the
defendants to install temperature adjusting equipment on their
retail motor fuel dispensing devices.

In certain of the cases, including some of the cases in which
Pantry is named, the plaintiffs also have alleged that because
defendants pay fuel taxes based on temperature adjusted 60
degree gallons, but allegedly collect taxes from consumers in
non-temperature adjusted gallons, defendants receive a greater
amount of tax from consumers than they paid on the same gallon
of fuel.

The plaintiffs in these cases seek, among other relief, recovery
of excess taxes paid and punitive damages.  

Both types of cases seek compensatory damages, injunctive
relief, attorneys' fees and costs, and prejudgment interest.

The defendants have filed motions to dismiss all cases for
failure to state a claim, which were heard by the court on
Jan. 11, 2008, according to the company's Feb. 5, 2008 form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended Dec. 27, 2007.

The Pantry, Inc. -- http://www.thepantry.com-- operates an  
independently operated convenience store chain in the U.S.  

QANTAS AIRWAYS: Flight Centre Backs Out from Price-Fixing Suit
Australian travel retailer Flight Centre Ltd (ASX:FLT) has
pulled out of an AU$80 million (US$72.3 million) class-action
lawsuit against six international airlines, including Qantas
Airways (ASX:QAN), over an alleged underpayment of commission

Aside from Qantas, the airline-defendants are:

          * Air New Zealand
          * British Airways
          * Cathay Pacific
          * Singapore Airlines
          * Malaysian Airlines

The Herald Sun recounts that law firm Slater & Gordon launched
the action on behalf of travel agents in December 2006 in an
attempt to recover commission on fuel surcharges.

Slater & Gordon asserts that the six airlines have short-changed
travel agents by up to AU$80 million by failing to include fuel
surcharges when calculating agents' fees.  It also alleges that
the airlines breached the Trade Practices Act by forcing travel
agents to record fuel surcharges as a tax rather than part of
the fare.

Moreover, in November 2007, Slater & Gordon accused Qantas,
which could account for AU$50 million of the claim, of
threatening to cut commissions of agents participating in the
class action, Herald Sun relates.  The law firm subsequently
sought an injunction in the Federal Court preventing the airline
from making any threats during commercial negotiations.

Flight Centre Managing Director Graham Turner said that the
travel center had advised Slater & Gordon that it was "unlikely"
to participate in the legal action because of "commercial
considerations" and would instead hold direct discussions with
the airlines, Trading Markets notes.

Mr. Turner expressed his belief, though, that fuel surcharges
should be incorporated into ticket prices rather than disguised
as taxes and treated as a separate cost.

Herald Sun points out that travel agents have been engaged in a
battle with airlines over their commission since the fuel
surcharge was introduced as a temporary measure in 2004 to
offset increased oil prices.  Almost 85% of the AU$17 billion in
international tickets sold in Australia between 2004 and 2006
came through travel agents.

The plaintiffs are represented by:

          Steven Lewis, Esq.
          Slater & Gordon
          11th Floor, 51 Druitt Street
          Sydney NSW 2000
          Phone: 8267 0626
          Fax: 8267 0650
          Legal help line: 1800 555 777
          Web site: http://www.slatergordon.com.au/

SPRINT NEXTEL: Faces Ill. Suit for Defrauding Wireless Consumers
Sprint Nextel Corp. faces a federal class-action lawsuit that
accuses the mobile phone carrier of defrauding wireless

The suit was filed with the U.S. District Court for the Southern
District of Illinois by Paula Appleby on Jan. 10, 2008, under
the caption, "Appleby v. Sprint Nextel Corporation et al., Case
No. 3:08-cv-00023-JPG-DGW."

Besides Sprint Nextel, other defendants in the matter include:

       -- Sprint Spectrum LP;
       -- Sprint Solutions, Inc.;
       -- Sprint/United Management Co.;
       -- Nextel Retail Stores LLC;
       -- Nextel Operations, Inc.;
       -- Nextel Partners Operating Corp.; and
       -- Nextel West Corp.

In general, the suit accuses defendants of defrauding customers
by extending contracts without "adequate notice," or else by
doing so without "obtaining meaningful consent."

The 23-page complaint states, "Defendants have misled and
deceived consumers by extending consumers' contracts for up to
two years without providing adequate notice or obtaining
meaningful consent to a contract extension when consumers made
small changes to their telephone service, such as adding extra
minutes or purchasing a new telephone; when they responded to
solicitations by defendants for additional products and
services; and when the consumer received 'courtesy discounts."

The suit is "Appleby v. Sprint Nextel Corporation et al., Case
No. 3:08-cv-00023-JPG-DGW," filed with the U.S. District Court
for the Southern District of Illinois, Judge J. Phil Gilbert

Representing the plaintiffs is:

          David W. Bauman, Esq.
          Carey & Danis LLC
          8235 Forsyth Boulevard, Suite 1100
          St. Louis, MO 63105-3786
          Phone: 314-725-7700
          e-mail: dbauman@careydanis.com

TEXAS: Circuit Upholds Dismissal of Lawsuit v. City of Palestine
The U.S. Court of Appeals for the Fifth Circuit upheld a ruling
by the U.S. District Court for the Eastern District of Texas,
that dismisses the class action, "L.D. Jones v. City of
Palestine, Case No. 6:06-cv-00299-JKG."

The suit was filed with the 3rd Judicial District Court in
Anderson County, Texas, on June 15, 2006, by L.D. Jones, on
behalf of a putative class of similarly situated individuals.

The suit challenges the fee charged by the City of Palestine,
Texas for residential wastewater between Sept. 12, 1994, and
Oct. 1, 2005.  In it, Mr. Jones alleged that the City of
Palestine passed an ordinance that clearly established a flat-
rate charge.

On July 5, 2006, the City of Palestine, removed the case to the
U.S. District Court for the Eastern District of Texas based on
federal question jurisdiction.

On Aug. 18, 2006, Mr. Jones moved for partial summary judgment.
On Sept. 29, 2006, the City of Palestine also moved for summary
judgment.  The parties filed the appropriate responses and

On Jan. 31, 2007, the district court denied Mr. Jones' motion,
granted the City's motion, and entered final judgment in favor
of the City.

Mr. Jones later appealed the District Court's decision to the
U.S. Court of Appeals for the Fifth Circuit.  The Fifth Circuit,
though, ruled in the City's favor by upholding the District
Court's ruling.

The suit is "Jones v. City of Palestine, Case No. 6:06-cv-00299-
JKG," filed with the U.S. District Court for the Eastern
District of Texas, Judge Judith K. Guthrie presiding.

Representing the plaintiff is:

          Jeffrey Don Herrington, Esq.
          Law Office of Dick Swift
          P.O. Drawer 2008
          Palestine, TX 75802-2008
          Phone: 214/729-2565
          Fax: 19037293061

Representing the defendant is:

          Ronald D. Stutes
          Potter Minton
          P. O. Box 359
          Tyler, TX 75710
          Phone: 903/597-8311
          e-mail ronstutes@potterminton.Com

TUESDAY MORNING: No Trial Date Set for Labor Calif. Litigation
No trial date has been set yet for the remaining complaint in a
consolidated labor-related class action filed against Tuesday
Morning Corp. in California.

During 2001 and 2002, the company was named as a defendant in
three complaints filed with the Superior Court of California in
and for the County of Los Angeles.  These three complaints were
subsequently consolidated into one action.  

The plaintiffs are seeking to certify a statewide class made up
of some current and former employees who claim to be owed
compensation for overtime wages, penalties and interest.  They
are also seeking attorney's fees and costs.

In October 2003, the company entered into a settlement agreement
with a sub-class of these plaintiffs, consisting of managers-in-
training and management trainees, which was paid in November

There is no trial date set for the remaining complaint,
according to the company's Feb. 8, 2008 form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter
ended Dec. 31, 2007.

Tuesday Morning Corp. -- http://www.tuesdaymorning.com/-- is a
closeout retailer of upscale home furnishings, gifts and related
items in the U.S.

UNITED STATES: Officials Sued Over U.S.-Mexico Security Fence
U.S. Department of Homeland Security Secretary Michael Chertoff
and U.S. Customs and Border Protection Active Executive Director
of Asset Management Robert F. Janson were sued by landowners
along the U.S.-Mexico border in an effort to keep surveyors off
their land.

In an attempt to curb the flow of illegal immigrants from Mexico
and other countries to the south, the federal government plans
to build 370 miles of security fencing and 300 miles of vehicle
barriers along the U.S. side of the border by the end of this
year, according to a report by James Osborne of The Monitor.

In December 2007, U.S. Homeland Security Secretary Michael
Chertoff sent out letters warning some 135 landowners to allow
federal surveyors on their land or face litigation.

While some have since complied, the vast majority continue to
hold out, bent on keeping the government from building the fence
across their properties, according to Laura Keehner, a
spokeswoman with the Department of Homeland Security tells The

One of those who are holding out is El Calaboz resident Eloisa
G. Tamez, who recently appeared before the U.S. District Court
for the Southern of District of Texas to fight a federal land
condemnation lawsuit filed to temporarily use 1.04 acres of land
that has been in her family's possession for hundreds of years.
Team 4 News reports that Ms. Tamez, and neighboring landowner
Benito J. Garcia, are the plaintiffs in the recently filed class
action they filed against the federal officials.  Both are
represented by attorney Abner Burnett, Esq. of the South Texas
Civil Rights Project, and Carlos Holguin of the Center for Human

The class action was filed on Feb. 6, 2008, under the caption,  
"Tamez v. Chertoff, Case No. 1:2008cv00055."  It was assigned to
Judge Andrew S. Hanen.

Generally, the suit contends that defendants ignored a recent
congressional mandate that repealed the mandatory construction
of 70 miles of border fence in the Rio Grande Valley.  It also
contends that federal officials did not follow laws requiring
them to work with property owners.

Furthermore, the suit claims that federal officials did not hold
any of its 18 town hall meetings regarding the construction of
the border wall in the Rio Grande Valley or other border
communities in Texas, according to Team 4 News.

The suit is "Tamez v. Chertoff, Case No. 1:2008cv00055," filed
with the U.S. District Court for the Southern District of Texas,  
Judge Andrew S. Hanen presiding.

Representing the plaintiffs are:

          Abner Burnett, Esq.
          Texas Civil Rights Project
          P.O. Box 188
          San Juan, TX 78589
          Phone: 956-787-8171
          Fax: 956-787-6348
          e-mail: lawyerburnett@netzero.com

               - and -

          Carlos Holguin, Esq.
          Center for Human Rights
          256 S. Occidental Blvd.
          Los Angeles, CA 90057
          Phone: 213-388-8693
          Fax: 213-386-9484
          e-mail: crholguin@centerforhumanrights.org

W.R. GRACE: Court Sides with Grace in 401(K) Plan Suit
The U.S. District Court for the District of Massachusetts
recently held that W.R. Grace and Co. and State Street Bank and
Trust Co. did not breach their fiduciary duties when making the
decision to divest Grace's 401(k) plan of the Grace Stock Fund,
Rebecca Moore writes for the Plan Adviser.

According to the report, Judge William G. Young agreed with
Grace and State Street that the current market price of Grace
stock was only one of the factors they needed to consider to
meet the prudent person standard of the Employee Retirement
Income Security Act.  "ERISA does not require that a fiduciary
maximize the value of investments provided to participants or
follow a detailed step by step process to analyze investment
options," Judge Young wrote in his opinion.

Judge Young said that the relevant question in the case was
whether State Street took into account all relevant information
in performing its fiduciary duty under ERISA.  And he concluded
that State Street did consider various factors including: the
current stock price, the Grace bankruptcy, the financial
performance and outlook of the company and its industry sector,
Grace's potential asbestos liability, and Securities and
Exchange Commission requirements.

Ms. Moore recounts that the plaintiffs had argued that State
Street overlooked the availability of other less risky
investment options that could provide diversification and
compensate for the high risk of keeping the Grace Stock Fund.
However, noting that Grace engaged State Street and charged it
with the single goal of determining the appropriateness of the
retention of Grace stock, Judge Young rejected the argument
since State Street had no discretion to make decisions about the
remaining investment options still available for the plan.

The plaintiffs recognized that in other company stock cases,
courts found it was prudent to keep the company stock even
though the price dropped.  However, Judge Young said that the
plaintiffs in other cases often argued that plan fiduciaries
should have dropped the stock investment because they had
knowledge that the price was likely to drop and that is what
State Street did in this case.

The plaintiffs also pointed out that Grace's financial results
were positive and it publicly announced it expected to survive
reorganization.  The court, however, concluded that State
Street's analysis showed "a potential for loss of value of the
Grace stock comparable to knowledge of an impeding collapse."

Judge Young also denied the plaintiffs' claim of self dealing on
the part of State Street for lack of "any specific proof that
State Street managed plan assets for a purpose other than the
benefit of the plan and its participants."  Since the Court
found that State Street did not commit a breach of its fiduciary
duties, Judge Young wrote, Grace prevails in the case as well
since the claims against it are derivative of the claims against
State Street.

                         Case Background

In 2003, a member of the Grace's Investments and Benefits
Committee informed plan participants that Grace fiduciaries were
"seriously consider[ing]" naming an independent fiduciary to
operate the Grace Stock Fund in order to avoid any potential
conflicts of interest arising out of the reorganization plan in
Grace's bankruptcy.  The committee later selected State Street
to serve as the independent fiduciary.

The goal of the delegation to State Street was to determine
whether the fund's retention or sale of Grace stock was
appropriate.  The investment guidelines included with its
engagement letter noted that State Street could sell the Grace
stock only if it determined that the continued holding of the
stock was inconsistent with ERISA.  State Street retained a
financial adviser and a legal adviser for the decision.

After determining, in February 2004, that the Plan's inclusion
of Grace stock was inconsistent with ERISA and, therefore,
imprudent, State Street gave Grace notice of its decision to
begin selling the plan's Grace stock.  After State Street sold
the stock -- at a price higher than market value -- a group of
participants filed a class action lawsuit against Grace, State
Street, and other plan fiduciaries claiming, among other things,
a breach of fiduciary duty.

The case is "Bunch v. W.R. Grace & Co., Case No. 04-11380-WGY,"
filed with the U.S. District Court for the District of

The plaintiffs are represented by:

          Jeffrey C Block, Esq.
          Berman DeValerio Pease Tabacco Burt & Pucillo
          One Liberty Square
          8th Floor
          Boston, MA 02109
          Phone: (617) 542-8300
          Fax: (617) 542-1194
          e-mail: jblock@bermanesq.com

               - and -

          Stanley M. Chesley, Esq.
          Waite, Schneider, Bayless & Chesley Co., LPA
          One W. Fourth Street
          1513 Fourth & Vine Tower
          Cincinnati, OH 45202
          Phone: (513) 621-0267
          Fax: (513) 621-0262

The defendants are represented by:

          Sean T. Carnathan, Esq.
          O'Connor, Carnathan and Mack LLC
          8 New England Executive Park
          Suite 310
          Burlington, MA 01803
          Phone: 781-359-9002
          Fax: 781-359-9001
          e-mail: scarnathan@ocmlaw.net

               - and -

          Carol Connor Cohen, Esq.
          Arent Fox PLLC
          1050 Connecticut Avenue NW
          Washington, DC 20036-5339
          Phone: (202) 857-6054
          Fax: (202) 857-6395
          e-mail: cohen.carol@arentfox.com


S U B S C R I P T I O N   I N F O R M A T I O N

Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA.   Glenn Ruel Senorin, Janice Mendoza, Freya Natasha Dy, and
Peter Chapman, Editors.

Copyright 2008.  All rights reserved.  ISSN 1525-2272.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
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Information contained herein is obtained from sources believed
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