/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/080307.mbx C L A S S A C T I O N R E P O R T E R Friday, March 7, 2008, Vol. 10, No. 48 Headlines ALABAMA: Man Jailed For Not Paying Traffic Fines Sues Florence ALPHARMA INC: Still Faces N.J. Suit Alleging FLSA Violations ALLEGHENY ENERGY: Fifth Circuit Considers Appeal in "Comer" Case ALLSTATE INSURANCE: Faces Lawsuit in Calif. Over Seat Belts AMERICAN WEST: Faces Lawsuit in Nevada Over Substandard Homes CALIFORNIA: Lawsuit Accuses El Grupo Mayan of Bilking Citizens CANADA: Students Disqualified in Woodlands School Lawsuit CAREMARK INC: Tenn. Grants Summary Judgment Motion in "Morrell" CAREMARK RX: Continues to Faces Pharmacy Benefit Managers' Suit CAREMARK RX: Discovery Ongoing in Cal. Suit by Non-ERISA Members CAREMARK RX: Plaintiff Seeks Stay on Proceedings in Ala. Lawsuit CNA FINANCIAL: Parties Settle Health Care Policyholders' Lawsuit CONSECO LIFE: Accused of Illegal Rate Hikes in Calif. Lawsuit CVS CAREMARK: Reaches Settlement in Calif. Pharmacists' Lawsuit FORD MOTOR: Court Grant Leave to Appeal Petition in N.J. Lawsuit FORD MOTOR: First Circuit Mulls Canadian Antitrust Suit Appeal FORD MOTOR: Mich. Court Mulls Motion to Dismiss ERISA Litigation FRY'S ELECTRONICS: Faces Labor Code Violations Suit in Calif. GILEAD SCIENCES: Nixing of CA Securities Lawsuit Still on Appeal GORTON'S SEAFOOD: Recalls Adulterated Battered Fish Fillets INFATINO LLC: Recalls Infant Rattles Due to Choking Hazard LORILLARD INC: Faces Calif. Tobacco Marketing, Advertising Suits LORILLARD INC: Fla. Court Decertifies Class in "Engle" Lawsuit LORILLARD INC: La. High Court Denies Review Petitions in "Scott" LORILLARD INC: Plaintiff in "Sanders" Seeks Supreme Court Review LORILLARD INC: Second Circuit Stays Proceedings in "Schwab" Case LUFKIN INDUSTRIES: Liability in "Discrimination Impact" Affirmed MERCURY INSURANCE: Settles Claims Valuation Suit in California MICROSOFT: e-Mails Show Knowledge of Error in "Vista" Lawsuit NEW YORK: Sued by Two Men Busted on Loitering Law QUAKER OATS: Recalls Pancake, Waffle Mixes Posing Health Risk REBELETTE INTL: Recalls Hoodies Posing Strangulation Hazard New Securities Fraud Cases ENERNOC INC: Federman & Sherwood Announces Securities Fraud Suit ENERNOC INC: Roy Jacobs Files Securities Fraud Lawsuit in Mass. SLM CORP: Charles Johnson Announces Filing of NY Securities Suit Asbestos Alerts ASBESTOS LITIGATION: Appeals Court OKs Dismissal of Beavers Case ASBESTOS LITIGATION: Temple-Inland Still Faces Exposure Actions ASBESTOS LITIGATION: United Fire's A&E Loss Reserves Total $5Mil ASBESTOS LITIGATION: U.S. Steel's Cases Rise to 325 at Dec. 31 ASBESTOS LITIGATION: Universal Forest Has Site Cleanup Reserves ASBESTOS LITIGATION: Sunoco Inc. Faces Potential 3rd Party Suits ASBESTOS LITIGATION: Solutia Still Involved in Asbestos Lawsuits ASBESTOS LITIGATION: Rogers Faces 175 Pending Claims at Dec. 30 ASBESTOS LITIGATION: Parsons Case v. Reynolds Units Still Stayed ASBESTOS LITIGATION: Regal Beloit Subject to Asbestos Lawsuits ASBESTOS LITIGATION: Cooper Ind. Action v. PepsiAmericas Ongoing ASBESTOS LITIGATION: PepsiAmericas Accrues $4Mil for Liability ASBESTOS LITIGATION: OfficeMax Continues to Face Injury Actions ASBESTOS LITIGATION: Court Rules v. Plaintiff in Kellogg Lawsuit ASBESTOS LITIGATION: Old Republic Cites Net Reserves of $121.9M ASBESTOS LITIGATION: Owens Corning Has $36M for Remaining Claims ASBESTOS LITIGATION: Minerals Technologies Still Faces 26 Suits ASBESTOS LITIGATION: Midwest Generation Has 207 Cases at Dec. 31 ASBESTOS LITIGATION: W.W. Grainger Inc. Faces 2,800 Plaintiffs ASBESTOS LITIGATION: Calif. Appeal Court Favors Black & Veatch ASBESTOS LITIGATION: Injury Lawsuits Still Pending v. Ford Motor ASBESTOS LITIGATION: Injury Suits Pending v. Advance Auto, Units ASBESTOS LITIGATION: 426 Lawsuits Pending v. AK Steel at Dec. 31 ASBESTOS LITIGATION: Alleghany Records $22.9M Reserve at Dec. 31 ASBESTOS LITIGATION: Allegheny Faces 826 W.Va. Claims at Dec. 31 ASBESTOS LITIGATION: Allstate Reserves $1.3B for Claims at Dec. ASBESTOS LITIGATION: AMETEK Continues to Face Exposure Lawsuits ASBESTOS LITIGATION: 538 Claims Pending v. Constellation & BGE ASBESTOS LITIGATION: Injury Lawsuits Still Pending v. Flowserve ASBESTOS LITIGATION: Fitzgerald Briefed on Johns-Manville Issues ASBESTOS LITIGATION: Grace Claimants Asks Court to Extend Period ASBESTOS LITIGATION: 40 Speights Claimants Appeal on Expungement ASBESTOS LITIGATION: Deadline on Grace's Appeal Set for April 14 ASBESTOS LITIGATION: Minn. Court Favors Plaintiffs in Northshore ASBESTOS LITIGATION: Oregon Court Affirms Newman's Remand Motion ASBESTOS LITIGATION: Ill. AG Sues Bldg. Owner for Cleanup Breach ASBESTOS LITIGATION: Vancouver Workers Back to Work After Scare ASBESTOS LITIGATION: Worker Sues Chesterton, 29 Firms in Texas ASBESTOS LITIGATION: Mining Sites' Hazard Limit Set Last Feb. 29 ASBESTOS LITIGATION: Americana Tenants Awarded $7,500 in Damages ASBESTOS LITIGATION: Groups Blast Canadian Gov't. Over Policies ASBESTOS LITIGATION: 160 Workers to File Lawsuit v. Japan Gov't. ASBESTOS LITIGATION: Inquest Links U.K. Worker's Death to Hazard ASBESTOS LITIGATION: Rigby's Widow Raises Awareness of Asbestos ASBESTOS LITIGATION: Hanover Has $19.4M A&E Reserves at Dec. 31 ASBESTOS LITIGATION: Lawsuits v. ENSCO Pending in Miss., Calif. ASBESTOS LITIGATION: 114 Suits Pending v. Curtiss-Wright in Dec. ASBESTOS LITIGATION: Hercules Offshore Faces Lawsuit from TODCO ASBESTOS LITIGATION: Foster Wheeler Cites $376.8M Dec. Liability ASBESTOS LITIGATION: Foster Wheeler Records 131,340 U.S. Claims ASBESTOS LITIGATION: Foster Wheeler Records $27.6M for N.Y. Case ASBESTOS LITIGATION: Foster Wheeler Has 342 U.K. Claims at Dec. ASBESTOS LITIGATION: CIRCOR Records $9.7M Liability at Dec. 31 ASBESTOS LITIGATION: Canadian Home Operator Given CDN50,000 Fine ASBESTOS LITIGATION: Wendell Couple of W.Va. Sues 38 Companies ASBESTOS LITIGATION: EnPro Faces 105,700 Open Cases at Dec. 31 ASBESTOS LITIGATION: Garlock Sealing Involved in 9 Trials in '07 ASBESTOS LITIGATION: Garlock Appealing $1.4M in Verdicts for '07 ASBESTOS LITIGATION: Garlock Settlement Commitments Total $76Mil ASBESTOS LITIGATION: Garlock Has $381.5M Coverage at Dec. 31 ********* ALABAMA: Man Jailed For Not Paying Traffic Fines Sues Florence -------------------------------------------------------------- A man filed a federal class action lawsuit against Florence, Alabama, who jailed him after being unable to pay fines for numerous misdemeanor traffic violations, the Associated Press reports. Matthew Dendy, 19, is described by his attorney, Robert Gonce, Esq., as indigent. Times Daily relates that between Feb. 27 and May 5, 2007, Mr. Dendy was sentenced to varying fines and jail terms, and on May 24, 2007, part-time Municipal Court Judge James Hall II sentenced him to 444 days in jail or a fine of $6,653. AP says that the suit, filed on Feb. 28, 2008, claims that Mr. Dendy's constitutional rights were violated by the court automatically imposing jail time and failing to examine the reasons why he could not pay the fines. According to Times Daily, the lawsuit also includes a claim that Mr. Dendy was denied medical care while incarcerated and that he must pay a fee to obtain medical services at the Lauderdale County Detention Center, where he is being held. Some say that the ability to pay fines can be questioned, Times Daily notes. "Fines are punishment; you can sit in jail in lieu of paying your fines," Tracy Roberts, assistant general counsel with the Alabama League of Municipalities, said. "If you have the ability to have income, but you do not earn income, you aren't exactly indigent (totally lacking income)." Times Daily points out that currently, the inability to pay fines and court costs is translated into jail time. Florence converts fines and costs against defendants into days spent in jail at a rate of $15 per day of jail time. The suit claims, however, that the statutory rate is $25 per day of jail time. Mr. Gonce said that the city will be served papers on the suit and that Police Chief Rick Singleton and Judge Hall will have 20 days to respond to the charges before a trial date is set. The plaintiff is represented by: Robert L. Gonce, Esq. (rgonce@alalawyers.com) Gonce, Young, Collum-Butler & Messer 09 North Court Street Florence, Alabama 35630 Phone: (256) 767-7411 (256) 764-1481 Fax: (256) 767-0320 ALPHARMA INC: Still Faces N.J. Suit Alleging FLSA Violations ------------------------------------------------------------ Alpharma, Inc. continues to face a purported class action in the U.S. District Court for the District of New Jersey, which is alleging violations of the Fair Labor Standards Act, according to the company's Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The complaint alleges that, among other things: -- over 200 of the Company's U.S. based Pharmaceuticals sales representatives were denied overtime pay, in violation of state and federal labor laws, by being paid for forty hour weeks even though they worked in excess of fifty-five hours per week, and -- that the Company violated federal record-keeping requirements. The suit is "Jackson v. Alpharma, Inc., Case No. 3:07-cv-03250- GEB-JJH," filed with the U.S. District Court for the District of New Jersey, Judge Garrett E. Brown, Jr. presiding. Representing the plaintiffs is: James E. Cecchi, Esq. Carella Byrne Bain Gilfillan Cecchi Stewart & Slstein, PC 5 Becker Farm Road Roseland, NJ 07068 Phone: (973) 994-1700 Fax: (973) 994-1744 e-mail: jcecchi@carellabyrne.com Representing the defendants is: Michael T. Bissinger Day Pitney, LLP PO Box 1945 Morristown, NJ 07962-1945 Phone: (973) 966-6300 Fax: (973) 966-1015 e-mail: mbissinger@daypitney.com ALLEGHENY ENERGY: Fifth Circuit Considers Appeal in "Comer" Case ---------------------------------------------------------------- The U.S. Court of Appeals for the Fifth Circuit has yet to issue a ruling on an appeal regarding the dismissal the of all defendants, including Allegheny Energy, Inc., from the purported class action, "Comer, et al. v. Nationwide Mutual Insurance Co., Case No. 1:05-cv-00436-LTS-RHW." The suit was filed on April 19, 2006 against Allegheny Energy, Inc., and numerous other companies with coal-fired generation facilities. It was brought on behalf of a purported class of residents and property owners in Mississippi who were harmed by Hurricane Katrina. The named plaintiffs allege that the emission of greenhouse gases by defendants contributed to global warming, thereby causing Hurricane Katrina and plaintiffs' damages. The plaintiffs seek unspecified damages. On Dec. 6, 2006, the company filed a motion to dismiss the plaintiffs' complaint on jurisdictional grounds and joined a motion filed by other defendants to dismiss the complaint for failure to state a claim. At a hearing on Aug. 30, 2007, the Court granted the motion to dismiss that Allegheny Energy had joined, and dismissed all of the plaintiffs’ claims against all defendants. The plaintiffs filed a notice of appeal of that ruling on Sept. 17, 2007, and the appeal will now proceed before the U.S. Court of Appeals for the Fifth Circuit. The company reported no development in the matter in its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "Comer, et al. v. Nationwide Mutual Insurance Co., Case No. 1:05-cv-00436-LTS-RHW," filed with the U.S. District Court for the Southern District of Mississippi, Judge L. T. Senter, Jr. presiding. Representing the plaintiffs are: F. Gerald Maples, Esq. Meredith A. Mayberry, Esq. F. Gerald Maples, PA 902 Julia Street New Orleans, LA 70113 Phone: 504/569-8732 e-mail: federal@geraldmaples.com mmayberry@geraldmaples.com - and - Randall Allan Smith, Esq. Stephen M. Wiles, Esq. Smith & Fawer 201 St. Charles Ave., Suite 3702 New Orleans, LA 70170 Phone: 504/525-2200 Fax: 504/525-2205 e-mail: rasmith3@bellsouth.net smwiles@smithfawer.com ALLSTATE INSURANCE: Faces Lawsuit in Calif. Over Seat Belts ----------------------------------------------------------- Allstate Insurance is facing a class-action complaint filed on Feb. 29, with the U.S. District Court for the Northern District of California accusing the company of refusing to inspect or replace seat belts in cars that have been involved in accidents, CourtHouse News Service reports. Named plaintiff Robert Watts claims that Allstate refused to pay for inspecting and repairing the seat belts in his 2005 Honda Civic after they were damaged in a collision. Mr. Watts says Allstate promised to pay for "the direct and accidental loss" to insured cars but does not make good on its promise, leaving policyholders in danger and in violation of the law in most states. Mr. Watts demands restitution and an injunction on charges of breach of contract, bad faith, fraud and RICO violations. This class action complaint asserts claims for relief for the following: (i) breach of contract; (ii) bad faith; (iii) breach of the implied covenant of good faith and fair dealing; (iv) fraud/misrepresentation; (v) unfair competition; and (vi) racketeer influenced and corrupt organizations violations. Mr. Watts brings the action pursuant to Rule 23 of the Federal Rules of Civil Procedure on behalf of any person insured by Allstate for any length of time from 1998 to the present who was involved in a collision in which automatic seat belt tensioners activated, after which Allstate failed to underwrite the inspection and replacement of the seat belts in the vehicle. Mr. Watts requests for the following relief: -- that the court determine that the action may be maintained as a class action under Rule 23 of the Federal Rules of Civil Procedure; -- that the court find that Allstate has violated Business and Professions Coed Section 17200 by developing and implementing a uniform policy of wrongfully declining to underwrite the post-collision inspections and repairs of Allstate-insured vehicles; -- that the court find that Allstate has violated 18 USC Section 1962(c) by preventing third party auto-repair shops from inspecting and repairing defective seat belt tensioners in Allstate-insured vehicles; -- that the court find that Allstate has violated 18 USC Section 1962(c) by operating its own line of auto-repair shops in part to further its implementation of its uniform scheme to wrongfully avoid underwriting post- collision inspections and repairs to Allstate-insured vehicles; -- that the court find that Allstate's violations as described have been knowing and willful; -- that Allstate be ordered and enjoined to pay restitution to plaintiffs and the class due to Allstate's unlawful and unfair and fraudulent activities, pursuant to Business and Professions Code Sections 17200-05; -- that Allstate further be enjoined to cease and desist from unlawful and unfair and fraudulent activities in violation of Business and Professions Code Section 17200, pursuant to Section 17203; -- that Mr. Watts and the class be awarded reasonable attorneys' fees and costs pursuant to Rule 23(h) of the Federal Rules of Civil Procedure and other applicable law; -- for punitive and exemplary damages in an amount commensurate with Allstate's ability to pay and sufficient to deter such conduct in the future; -- that the court award such other and further relief as the court may deem appropriate. The suit is "Robert Watts et al. v. Allstate Insurance Company et al., Case No. 08 1236," filed with the U.S. District Court for the Northern District of California. Representing the plaintiff are: Wendy C. York, Esq. Timothy B. Nelson, Esq. York Law Corporation 1111 Exposition Boulevard, Building 500 Sacramento, CA 95815 Phone: (916) 643-2200 Fax: (916) 643-4680 AMERICAN WEST: Faces Lawsuit in Nevada Over Substandard Homes ------------------------------------------------------------- American West Homes is facing a class-action complaint filed with the U.S. District Court for the District of Nevada alleging it built and sold dozens of substandard homes, CourtHouse News Service reports. Residents of the Classics Development subdivision bring this action on behalf of homeowners of approximately 100 homes within the the Classics Development. The complaint alleges defendants knew or in the exercise of reasonable diligence should have known, that all persons who planned to purchase and who did in fact purchase said structures would do so without inspection of the defects -- which include patent defects, latent defects and defects which defendants knew or in the exercise of reasonable diligence should have known would occur. As a direct and proximate result of defendants' willful misconduct, plaintiffs sustained damages in an amount precisely unknown but believed to be within the jurisdiction of the court, in that plaintiffs have been and will be required to perform investigations and works for repair, restoration, and construction to portions of the structures to prevent further damage and to restore the structures to their proper condition and will suffer damages in an amount in excess of $10,000, the full nature and extent of which shall be ascertained according to proof of trial. The suit is "Linda Bennett et al v. American West Homes, Inc., Case No. A558243," filed with the U.S. District Court for the District of Nevada. Representing the plaintiffs are: Craig D. Fuller, Esq. 4250 Executive Square, Suite 555 La Jolla, CA 92037 - and - Mark A. Lobello, Esq. The LoBello Law Firm 2061 E. Sahara, 2dn Floor Las Vegas, NV 89104 Phone: (702) 870-8000 CALIFORNIA: Lawsuit Accuses El Grupo Mayan of Bilking Citizens -------------------------------------------------------------- A federal class-action complaint filed with the U.S. District Court for the Central District of California accuses El Grupo Mayan Palace of bilking U.S. citizens of "hundreds of millions of dollars" in Mayan Resorts timeshares, CourtHouse News Service reports. The complaint names the following as defendants: -- Desarollo Marina Vallarta SA de CV, -- El Grupo Mayan Palace, -- Daniel Chavez Moran, -- Daniel Omar Chavez, -- Scott Erikson, -- Casey Jon Owens, -- Canamere Inc., -- Huffsmith-Kohrville Inc., -- Preferred Vacations Inc., -- Premium Travel Services Inc., -- Resort Solutions Inc., -- Seven Oceans US Inc., -- AZM Marketing LLC, -- Resort Quality Controls Inc., -- Resort Condominiums International LLC, and -- Resorts International Marketing Corp. The plaintiffs brings the action under Title 18 of the U.S. Code Section 1961, et seq., the Racketeer Influenced and Corrupt Practices Act (RICO) and California state law, seeking monetary and injunctive relief. This case concerns a conspiracy operating and managing resorts in Mexico -- the Mayan Resorts -- which has bilked U.S. citizens out of hundreds of millions of dollars through the use of high pressure fraudulent sales tactics that are comparable to the worst tactics ever employed by used car salesmen in a Hollywood movie. The complaint states that the "defendants earn hundreds of millions each year from such sales by systematically misrepresenting in sales presentations and documents the value of the timeshares they are selling. Defendants as part of their scheme also have misled Plaintiffs as to their rights under Mexican law." The plaintiffs seek to represent all persons who purchased a Mayan Resorts timeshare within the preceding four years and executed a document waiving their right to have their deposit returned if the contract was canceled within five business days. The plaintiffs want the court to rule on: (a) whether the Mayan Resorts defendants falsely represented the nature of the cancellation waiver; (b) whether the defendants falsely represented, failed to disclose and concealed the investment value of the timeshare units; (c) whether the defendants conspired with others to falsely represent the Rental Return of the timeshare rentals; (d) whether the defendants' acts constitute violations of the federal RICO statute, 18 USC Section 1961 et seq.; (e) whether the defendants' activities related to their failure to disclose that the five day right to cancellation could not be waived constitute violations of California's Unfair Competition Law, Business and Professions Code Section 17200, et seq.; (f) whether the fact that the five business day right to cancel was non-waivable was material and relevant information under California's Unfair Competition Law, Business and Professions Code Section 17200, et seq.; (g) whether the defendants' conduct is unlawful, unfair or fraudulent within the meaning supplied by California's Unfair Competition Law, Business and Professions Code Section 17200, et seq.; (h) whether the defendants' acts constitute unfair competition within the meaning of California's Unfair competition Law, Business and Professions Code Section 17200, et seq.; (i) whether the defendants' acts constitute false advertising within the meaning of California Business and Professions Code Section 17500, et seq.; (j) whether the defendants' acts constitute common law fraud; (k) whether the defendants' acts constitute fraud in the inducement; (l) whether the defendants' acts constitute civil conspiracy to defraud; (m) whether the defendants' acts constitute breach of the duty of good faith and fair dealing; (n) whether the defendants' acts constitute negligence; (o) whether the defendants' acts constitute gross negligence; (p) whether the defendants' acts constitute negligent misrepresentation; and (q) whether the defendants' acts constitute grossly negligent misrepresentation. The plaintiffs request that the court grant the following relief: -- grant judgment in favor of plaintiffs and against the defendants; -- grant temporary and permanent injunctive relief; -- declare that the defendants' conduct constitutes violations of the statutes and common law cited; -- award the plaintiffs an appropriate amount in monetary damages as determined at trial, including pre- and post- judgment interest; -- award the plaintiffs attorneys' fees and the costs of bringing this action; -- award the plaintiffs treble damages against all defendants, jointly and severally, in an amount in excess of $75,000 to be proven at trial together with prejudgment interest, costs and attorneys' fees; -- impose exemplary and punitive damages against defendants in an appropriate amount to be determined at trial; and -- grant the plaintiffs such other relief as is just and appropriate. The suit is "Jessica Monugian et al. v. Desarollo Marina Vallarta S.A. de C.V. et al., Case No. CV08-01497," filed with the U.S. District Court for the Central District of California. Representing the plaintiffs is: Kevin J. Barry, Esq. Boies, Schiller & Flexner LLP 1999 Harrison street, Suite 900 Oakland, CA 94612 Phone: (510) 874-1000 Fax: (510) 874-1460 CANADA: Students Disqualified in Woodlands School Lawsuit --------------------------------------------------------- A class-action lawsuit filed by the survivors of New Westminster's Woodlands school has been delayed yet again, CKNW reports. The suit alleges students suffered years of physical, emotional and sexual abuse at the school. According to CKNW, a full third of the applicants has been thrown out of the lawsuit. Specifically, students who allegedly suffered abuse at the school prior to 1974 have been told they cannot sue the provincial government because laws at that time make it nearly impossible to do so. However, lawyer David Klein, who represents the former students, says that itis the government, not the laws, preventing victims from seeking compensation. Mr. Klein says he is appealing the decision. The Class Action Reporter reported on Dec. 4, 2007, that Poyner Baxter filed the class action in 2002 against the Government of British Columbia on behalf of an estimated 1,500 former residents of Woodlands School. Subsequently, the province's Public Guardian and Trustee commenced a similar suit, seeking to represent all victims in the class. The court eventually awarded "carriage" to Poyner Baxter. In March 2005, Madam Justice Nancy Morrison of the British Columbia Supreme Court certified the suit as a class action. For more information on the case, contact: Jim Poyner (jim@poynerbaxter.com) Poyner Baxter, LLP #408 - 145 Chadwick Court North Vancouver, B.C. Phone: (604) 988-6321 Fax: (604) 988-3632 CAREMARK INC: Tenn. Grants Summary Judgment Motion in "Morrell" --------------------------------------------------------------- The U.S. District Court for the Middle District of Tennessee granted a motion for partial summary judgment in the matter, "Moeckel v. Caremark RX, Inc., et al., Case No. 3:04-cv-00633." Caremark Inc. (now known as Caremark, L.L.C.), a subsidiary of Caremark Rx, Inc. that merged with CVS Corp. to form CVS Caremark Corp., was named as a defendant in the putative class action, which was filed on July 2004 by an individual named Robert Moeckel. The suit was brought purportedly on behalf of the John Morrell Employee Benefits Plan, which is an employee benefit plan sponsored by a former Caremark client. The lawsuit, which seeks unspecified damages and injunctive relief, alleges that Caremark acts as a fiduciary under ERISA and has breached certain alleged fiduciary duties under ERISA. In November 2007, the court granted Caremark Inc.’s motion for partial summary judgment finding that it is not an ERISA fiduciary under the applicable PBM agreements and that the plaintiff may not sustain claims for breach of fiduciary duty, according to CVS Caremark's Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 29, 2007. The suit is "Moeckel v. Caremark RX, Inc., et al., Case No. 3:04-cv-00633," filed with the U.S. District Court for the Middle District of Tennessee, Judge Aleta A. Trauger presiding. Representing the plaintiffs are: Rebecca Cothran Blair, Esq. John A. Day, Esq. Branham & Day P.C. 5300 Maryland Way, Suite 300 Brentwood, TN 37027 Phone: (615) 742-4880 e-mail: rblair@branhamday.com jday@branhamday.com - and - Mike Miller, Esq. Solberg Stewart Miller & Tjon 1129 Fifth Avenue South P.O. Box 1897 Fargo, ND 58107-1897 Phone: (701) 237-3166 e-mail: mmiller@solberglaw.com Representing the defendants are: Paul Savage Davidson, Esq. Joseph A. Woodruff, Esq. Jennifer L. Weaver, Esq. Waller, Lansden, Dortch & Davis Nashville City Center 511 Union Street, Suite 2100 Nashville, TN 37219 Phone: (615) 244-6380 Fax: (615) 244-6380 e-mail: pdavidson@wallerlaw.com joseph.woodruff@wallerlaw.com jennifer.weaver@wallerlaw.com - and - Frank E. Pasquesi, Esq. Foley & Lardner LLP Phone: 312.832.5176 e-mail: fpasquesi@foley.com CAREMARK RX: Continues to Faces Pharmacy Benefit Managers' Suit --------------------------------------------------------------- Caremark Rx, Inc., which merged with CVS Corp. to form CVS Caremark Corp., continues to face the consolidated class action, "In Re Pharmacy Benefit Managers Antitrust Litigation, Case No. No. 06-md-01782-JF," which is pending with the U.S. District Court for the Eastern District of Pennsylvania. Initially, various lawsuits were filed alleging that Caremark and its subsidiaries Caremark Inc. (now known as Caremark, L.L.C.) and AdvancePCS (now known as CaremarkPCS, L.L.C.) have violated applicable antitrust laws in establishing and maintaining retail pharmacy networks for client health plans. Bellevue Drug Litigation In August 2003, Bellevue Drug Co., Robert Schreiber, Inc. d/b/a Burns Pharmacy and Rehn-Huerbinger Drug Co. d/b/a Parkway Drugs #4, together with Pharmacy Freedom Fund and the National Community Pharmacists Association filed a putative class action against AdvancePCS in Pennsylvania federal court, seeking treble damages and injunctive relief. The claims were initially sent to arbitration based on contract terms between the pharmacies and AdvancePCS. North Jackson Litigation In October 2003, two independent pharmacies, North Jackson Pharmacy, Inc. and C&C, Inc. d/b/a Big C Discount Drugs, Inc., filed a putative class action complaint in Alabama federal court against Caremark, Caremark Inc., AdvancePCS (acquired by Caremark in March 2004 and now known as CaremarkPCS, L.L.C.), and two PBM competitors, seeking treble damages and injunctive relief. The case against Caremark and Caremark Inc. was transferred to Illinois federal court, and the AdvancePCS case was sent to arbitration based on contract terms between the pharmacies and AdvancePCS. The arbitration was then stayed by the parties pending developments in Caremark’s court case. Consolidation In August 2006, the Bellevue case and the North Jackson Pharmacy case were transferred to the U.S. District Court for the Eastern District of Pennsylvania by the Judicial Panel on Multidistrict Litigation for coordinated and consolidated proceedings with other cases before the panel, including cases against other PBMs. Caremark has appealed a decision which vacated the order compelling arbitration and staying the proceedings in the Bellevue case to the U.S. Court of Appeals for the Third Circuit. Motions for class certification in the coordinated cases within the multidistrict litigation, including the North Jackson Pharmacy case, remain pending. The consolidated action is now known as the "In Re Pharmacy Benefit Managers Antitrust Litigation, Case No. No. 06-md-01782- JF." CVS Caremark reported no development in the matter in its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 29, 2007. CVS Caremark Corp. -- http://www.cvs.com-- is a provider of prescriptions and related healthcare services in the U.S. The Company fills or manages more than one billion prescriptions annually. CAREMARK RX: Discovery Ongoing in Cal. Suit by Non-ERISA Members ---------------------------------------------------------------- Discovery is ongoing in a purported class action filed with the Superior Court of the State of California against Caremark Rx Inc., which merged with CVS Corp. to form CVS Caremark Corp., on behalf of all California members of non-ERISA health plans and/or all California taxpayers. Caremark and its subsidiaries Caremark Inc. (now known as Caremark, L.L.C.) and AdvancePCS (acquired by Caremark in March 2004 and now known as CaremarkPCS, L.L.C.) have been named in a putative class action lawsuit filed in California state court by an individual named Robert Irwin, purportedly on behalf of California members of non-ERISA health plans and/or all California taxpayers. The lawsuit, which also names other Pharmacy Benefit Managers (PBM) as defendants, alleges violations of California’s unfair competition laws and challenges alleged business practices of PBMs, including practices relating to pricing, rebates, formulary management, data utilization and accounting and administrative processes. Discovery in the case is ongoing, according to its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 29, 2007. CVS Caremark Corp. -- http://www.cvs.com-- is a provider of prescriptions and related healthcare services in the U.S. The Company fills or manages more than one billion prescriptions annually. CAREMARK RX: Plaintiff Seeks Stay on Proceedings in Ala. Lawsuit ---------------------------------------------------------------- John Lauriello who had sued Caremark Rx, Inc. over a 1999 settlement of various securities class action and derivative lawsuits against Caremark and others is seeking for a stay in his case against the company. Caremark, which merged with CVS Corp. to form CVS Caremark Corp., was named in a putative class action filed in 2003 in Alabama state court by Mr. Lauriello, purportedly on behalf of participants in the 1999 settlement of various securities class action and derivative lawsuits against Caremark and others. Other defendants in the lawsuit include insurance companies that provided coverage to Caremark with respect to the settled lawsuits. The Lauriello lawsuit seeks approximately $3.2 billion in compensatory damages plus other non-specified damages based on allegations that the amount of insurance coverage available for the settled lawsuits was misrepresented and suppressed. A similar lawsuit was filed the next month by Frank McArthur, also in Alabama state court, naming Caremark, several insurance companies and attorneys and law firms involved in the 1999 settlement. This lawsuit was subsequently stayed by the court as a later-filed class action. In 2005, the trial court in the Lauriello case issued an order allowing the Lauriello case to proceed on behalf of the settlement class in the 1999 securities class action. Mr. McArthur then sought to intervene in the Lauriello case and to challenge the adequacy of Mr. Lauriello as class representative and his lawyers as class counsel. The trial court denied Mr. McArthur’s motion to intervene, but the Alabama Supreme Court subsequently ordered the lower court to vacate its prior order on class certification and allow McArthur to intervene. Caremark and other defendants have filed motions to dismiss the complaint in intervention filed by Mr. McArthur. In November 2007, the trial court dismissed the attorneys and law firms named as defendants in the McArthur complaint in intervention, and denied the motions to dismiss that complaint filed by Caremark and the insurance company defendants. In January 2008, Mr. Lauriello filed a motion to dismiss Mr. McArthur’s complaint in intervention, appealed the court’s dismissal of the attorney and law firm defendants, and filed a motion to stay proceedings pending his appeal, according to CVS Caremark's Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 29, 2007. CVS Caremark Corp. -- http://www.cvs.com-- is a provider of prescriptions and related healthcare services in the U.S. The Company fills or manages more than one billion prescriptions annually. CNA FINANCIAL: Parties Settle Health Care Policyholders' Lawsuit ---------------------------------------------------------------- Parties in the purported class action, "Shaffer v. Continental Casualty Co., et al., Case No. CV06-2235 RGK," which names CNA Financial Corp., an 89%-owned subsidiary of Loews Corp, and Continental Casualty Co. (CCC), as defendants, have reached binding agreement settling the matter, according to Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit, which is pending in the U.S. District Court for the Central District of California, is a class action on behalf of certain California long term health care policyholders, alleging that CCC and CNAF knowingly used unrealistic actuarial assumptions in pricing these policies, which according to plaintiff, would inevitably necessitate premium increases (Class Action Reporter, Nov. 9, 2007). The plaintiff asserts claims for intentional fraud, negligent misrepresentation, and violations of various California statutes. CCC and CNAF have denied the material allegations of the amended complaint and intend to vigorously contest the claims. On Jan. 26, 2007, the court certified the case to proceed as a class action. CCC and CNAF have appealed the grant of class certification to the U.S. Court of Appeals for the Ninth Circuit. The Ninth Circuit refused to hear the appeal on an interlocutory basis. In April 2007, the Court denied CCC’s and CNAF’s motions for summary judgment with the exception of the motion relating to plaintiffs’ claim under the California Legal Remedies Act, which was dismissed. The claim under CLRA involved a provision for claims of awards for attorneys’ fees and enhanced damages. In June 2007, CCC and CNAF filed a motion to reconsider the denial of summary judgment on the fraud claim. In July 2007, the Court denied the motion for reconsideration. On Oct. 10, 2007, CCC, CNA and the plaintiffs reached agreement on terms, subject to entering into a binding settlement agreement. On Jan. 8, 2008, parties entered into a binding agreement settling the case on a nationwide basis for the policy forms potentially affected by the allegations of the complaint. Under the settlement agreement, CCC will provide certain enhanced benefits to eligible class members including certain non-forfeiture benefits, opportunities to exchange policies and free health screenings. The agreement, which is subject to notice to the class as well as Court approval, did not have a material adverse effect on the financial condition, cash flows or results of operations of the Company. The suit is "Ralph Shaffer v. Continental Casualty Co. et al., Case No. 2:06-cv-02235-PSG-PJW," filed with the U.S. District Court for the Central District of California, Judge Philip S. Gutierrez presiding. Representing the plaintiffs are: Wayne S. Kreger, Esq. Milstein Adelman & Kreger LLP 2800 Donald Douglas Loop North Santa Monica, CA 90405 Phone: 310-396-9600 e-mail: wkreger@maklawyers.com - and - Richard J. Arsenault, Esq. Neblett Beard and Arsenault 2220 Bonaventure Court, P.O. Box 1190 Alexandria, LA 71309-1190 Phone: 318-487-9874 e-mail: rarsenault@nbalawfirm.com Representing the defendants are: Brent R. Austin, Esq. Wildman Harrold Allen and Dixon 225 West Wacker Drive, Suite 2200 Chicago, IL 60606-1229 Phone: 312-201-2848 e-mail: austin@wildmanharrold.com - and - Stan Karas, Esq. Quinn Emanuel Urquhart Oliver and Hedges 865 South Figueroa Street, 10th Floor Los Angeles, CA 90017-2543 Phone: 213-443-3000 e-mail: stankaras@quinnemanuel.com CONSECO LIFE: Accused of Illegal Rate Hikes in Calif. Lawsuit ------------------------------------------------------------- Conseco Life Insurance is facing a class-action complaint filed on March 4, 2008, with the U.S. District Court for the Central District of California accusing it of illegally imposing "staggering" rate hikes on policyholders that "are so huge and so sudden that they cannot possibly be based on expectations as to future mortality," CourtHouse News Service reports. The complaint states that the court ruled against the defendant in a previous national class action "Rosenbaum et al. v. Philadelphia Life Insurance Co.," (Conseco's predecessor). After that ruling, "Defendant Conseco Life was forced to return all the unlawful cost of insurance charges, plus interest, to its policyholders. The policies at issue in this action have the exact same cost of insurance provisions as the policies adjudicated by this Court in the Rosenbaum Action," the complaint states. Named plaintiff Celedonia X. Yue brings the action on behalf of all owners of Valuelife and Valuterm universal life insurance policies administered by defendant. The plaintiff seeks an injunction requiring the defendant to reverse the unlawful increases in cost of insurance charges on the policies and to fulfill their contractual and other obligations to the class. The plaintiff seeks a corresponding declaration that the defendant must determine the cost of insurance charges for the policies in accordance with the terms of the policies and reinstate the cost of insurance charges that existed before the recent unlawful increases. The plaintiff also seeks corresponding monetary relief requiring defendant to repay to the class, or restore to the accumulation accounts of the policies, the amount of any unlawful overcharges. The plaintiff wants the court to rule on: (a) whether the defendant's actions to increase the cost of insurance charges on the policies violated the terms of the policies; (b) whether Conseco Life breached its contracts with the plaintiff and members of the class; (c) whether the defendant breached obligations of good faith and fair dealing owed to plaintiff and members of the class; (d) whether the defendant committed acts of unfair competition as defined by California Business and Professions Code Section 17200, et seq.; (e) whether the plaintiff and members of the class are entitled to specific performance, injunctive relief or other equitable relief against the defendant; and (f) whether the plaintiff and class members are entitled to receive incidental monetary relief or, alternatively, damages as a result of the unlawful conduct by the defendant alleged. The plaintiffs request for judgment providing: -- injunctive relief to preliminarily and permanently enjoin the defendant, its representatives, and all] others acting with it or on its behalf: (a) from changing the cost of insurance and the attendant cost of insurance charges, other than for expectations as to future mortality experience, respecting the policies; and (b) from increasing the cost of insurance charges for the policies and requiring those charges to be returned to the levels that existed prior to the unlawful increases imposed by defendant; -- injunctive relief requiring the defendant, its representatives, and all others acting with it or on its behalf to reinstate any policyholder whose policy was canceled or surrendered as a result of the intended unlawful cost of insurance increases; -- incidental or other monetary relief in the form of repayments to the plaintiff and members of the class of all overcharges resulting from the cost of insurance increases complained of and payment of such amounts into the accumulation accounts of the policies; -- alternatively, general damages, consequential damages, and other incidental damages in a sum to be determined at the time of trial; -- restitutionary relief requiring defendant to disgorge and divest all money received from policyholders as a result of, or caused by, the artificial and sham increase in the cost of insurance (mortality) charges; -- a declaration that the increases in cost of insurance charges are in material breach of the policies and that defendant must determine the cost of insurance charges as explicitly set forth in the policies; -- attorneys' fees expended and incurred in recovery of benefits and enforcement of the terms of the policies against defendant in a sum to be determined at the time of trial; -- costs of suit incurred; and -- award of prejudgment and post-judgment interest. The suit is "Celedonia X. Yue et al. v. Conseco Life Insurance et al., Case No. CV08-01506 CAS," filed with the U.S. District Court for the Central District of California. Representing the plaintiffs are: Timothy P. Dillon, Esq. (timothy@dillon.net) Law Office of Timothy P. Dillon 361 Forest Avenue, Suite 205 Laguna Beach, California 92651 Phone: (949) 376-2800 Fax: (949) 376-2808 - and - Andrew S. Friedman, Esq. (afriedman@BFFB.com) Bonnet, Fairbourn, Friedman & Balint, P.C. 2901 N. Central, Suite 1000 Phoenix, AZ 85012 Phone: (602) 776-5902 Fax: (602) 274-1199 CVS CAREMARK: Reaches Settlement in Calif. Pharmacists' Lawsuit --------------------------------------------------------------- CVS Caremark Corp. reached a tentative settlement for a purported class action filed in California against the company by Gabe Tong, purportedly on behalf of current and former pharmacists working in the company’s California stores. The lawsuit alleges that CVS failed to provide pharmacists in the purported class with meal and rest periods or to pay overtime as required under California law. In October 2007, CVS reached a conditional agreement, which is subject to approval by the court to resolve this matter, according to CVS Caremark's Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 29, 2007. CVS Caremark Corp. -- http://www.cvs.com-- is a provider of prescriptions and related healthcare services in the U.S. The Company fills or manages more than one billion prescriptions annually. FORD MOTOR: Court Grant Leave to Appeal Petition in N.J. Lawsuit ---------------------------------------------------------------- The U.S. Court of Appeals for the Third Circuit has granted the company's petition for leave to appeal the class certification order in the matter "Danvers Motor Co., et al. v. Ford Motor Co., Case No. 2:2002cv02197." In November 2000, a putative nationwide class of Ford dealers brought suit with the U.S. District Court for the District of New Jersey, claiming that the Company's recently-introduced Blue Oval Program violated state and federal law (Class Action Reporter, Jan. 27, 2006). The plaintiffs specifically allege that Ford's Blue Oval Certified Program, which was designed to reward dealers who obtained high customer satisfaction ratings, violated the Robinson-Patman Act, the Automobile Dealer's Day in Court Act, and various state laws. The complaint seeks injunctive and declaratory relief, and unspecified damages (including compensatory, statutory, treble, and punitive damages). On Jan. 31, 2007, the U.S. District Court for the District of New Jersey certified a nationwide class of dealers who were franchisees of Ford Motor Company's Ford Division at any time during the period mid-2000 through March 2005. The U. S. Court of Appeals for the Third Circuit has granted the company's petition for leave to appeal the class certification order, and its appeal is pending, according to its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "Danvers Motor Co., et al. v. Ford Motor Co., Case No. 2:2002cv02197," filed with the U.S. District Court for the District of New Jersey, Judge Dennis M. Cavanaugh presiding. Representing the plaintiffs are: Eric Lewis Chase, Esq. Bressler, Amery & Ross, Esqs. 325 Columbia Turnpike Florham Park, NJ 07932 Phone: (973) 514-1200 e-mail: echase@bressler.com - and - Richard Lloyd Hertzberg, Esq. Greenbaum, Rowe, Smith, & Davis, LLP Metro Corporate Campus One PO Box 5600 Woodbridge, NJ 07095 Phone: (732) 549-5600 e-mail: rhertzberg@greenbaumlaw.com Representing the defendants are: James Steven Dobis, Esq. Dobis Russell & Peterson 326 South Livingston Avenue Livingston, NJ 07039 Phone: 973-740-2474 e-mail: jdobis@drp-law.com FORD MOTOR: First Circuit Mulls Canadian Antitrust Suit Appeal -------------------------------------------------------------- The U.S. Court of Appeals for the First Circuit has yet to rule on an appeal in connection to the certification of a nationwide class of buyers and lessees in the purported class action, "In re New Market Vehicle Canadian Export Antitrust Litigation Cases," which names Ford Motor Co., as one of the defendants. Initially, eighty-three purported class actions on behalf of all purchasers of new motor vehicles in the U.S. since Jan. 1, 2001 have been filed in various state and federal courts against numerous defendants, including Ford, General Motors Corp., DaimlerChrysler Corp., Toyota Motor Corp., Honda Motor Co., Nissan Motor Co., BMW Group, the National Automobile Dealers Association, and the Canadian Automobile Dealers Association. The federal and state complaints allege, among other things, that the manufacturers, aided by the dealer associations, conspired to prevent the sale to U.S. citizens of vehicles produced for the Canadian market and sold by dealers in Canada at lower prices than vehicles sold in the U.S. The complaints seek injunctive relief under federal antitrust law and treble damages under federal and state antitrust laws The federal court actions have been consolidated for coordinated pretrial proceedings in the U.S. District Court for the District of Maine. On March 21, 2007, the U.S. District Court ruled that it will certify classes of all purchasers of new vehicles in 20 states between Jan. 1, 2001 and April 30, 2003 for damages under various state law theories. The company intends to appeal. The company's appeal of the class certification order is pending, according to its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. Ford Motor Co. -- http://www.ford.com-- is a producer of cars and trucks. The Company and its subsidiaries also engage in other businesses, including financing vehicles. Ford operates in two sectors: Automotive and Financial Services. The Automotive sector includes the operations of Ford North America, Ford South America, Ford Europe, Premier Automotive Group, and Ford Asia Pacific and Africa/Mazda segments. The Financial Services sector includes the operations of Ford Motor Credit Company (Ford Credit), which is engaged in vehicle-related financing, leasing, and insurance. FORD MOTOR: Mich. Court Mulls Motion to Dismiss ERISA Litigation ---------------------------------------------------------------- The U.S. District Court for the Eastern District of Michigan has yet to rule on a motion seeking for the dismissal of a purported class action against Ford Motor Co., and several of the company's current or former employees and officers, which is alleging violations of the Employee Retirement Income Security Act (ERISA). The suit, "Nowak, et al. v. Ford Motor Company, et al., Case No. 06-cv-11718," originally filed by Theodore Nowak and Gary Brockway on April 7, 2006 (Class Action Reporter, July 31, 2007). The lawsuit alleges that the defendants violated ERISA by failing to prudently and loyally manage funds held in employee savings plans sponsored by Ford. Specifically, the plaintiffs allege among other claims that the defendants violated fiduciary duties owed to plan participants by continuing to offer Ford Common Stock as an investment option in the savings plans. The company's motion to dismiss currently is pending before the court, according to its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "Nowak, et al. v. Ford Motor Company, et al., Case No. 06-cv-11718," filed with the U.S. District Court for the Eastern District of Michigan. Representing the plaintiffs are: Elizabeth A. Leland, Esq. Derek W. Loeser, Esq. Lynn L. Sarko, Esq. Keller Rohrback LLP 1201 Third Avenue, Suite 3200 Seattle, WA 98101 Phone: 206-623-1900 Fax: 206-623-3384 e-mail: bleland@kellerrohrback.com dloeser@kellerrohrback.com lsarko@kellerrohrback.com - and - Jayson E. Blake, Esq. The Miller Law Firm 950 W. University Drive, Suite 300 Rochester, MI 48307 Phone: 248-841-2200 e-mail: jeb@millerlawpc.com Representing defendants are: Michelle Thurber, Esq. Czapski of Dickinson Wright (Detroit) 500 Woodward Avenue, Suite 4000 Detroit, MI 48226-3425 Phone: 313-223-3500 e-mail: mczapski@dickinsonwright.com - and - Robert N. Eccles, Esq. O'Melveny & Myers 1625 Eye St., NW Washington, DC 20006-4001 Phone: 202-383-5315 Fax: 202-383-5414 e-mail: beccles@omm.com FRY'S ELECTRONICS: Faces Labor Code Violations Suit in Calif. ------------------------------------------------------------- Fry's Electronics is facing a class-action complaint filed on Feb. 28, 2008, with the Superior Court of the State of California, County of Santa Clara accusing it of violating the Labor Code. This is a class action for violation of California wage and hour laws brought on behalf of current and former Fry's employees who have been employed by Fry's in the State of California, at any time between Feb. 22, 2004, and who have been employed anywhere in the United States between Feb. 22, 2004, and the date of notice is mailed to the class. The plaintiffs allege that during the relevant time period, they were not paid all earned and vested 'vacation' pay, worked over 40 hours in a week or over eight hours in a day time without receiving the proper pay rate, received pay stubs that were inaccurate, were required to purchase shirts from Fry's bearing a corporate logo and were not indemnified fr the expense of the shirts, and plaintiffs and the class of Fry's employees who worked throughout the United States for Fry's who worked in excess of 40 hours a week and were not properly paid for the hours worked. The plaintiffs request judgment as follows: -- that this action be certified as a class action; -- that plaintiffs be appointed as representatives of the classes they seek to represent; -- that counsel for plaintiffs be appointed as class counsel; -- for all vested vacation wages earned; -- for waiting time penalties pursuant to Labor Code Section 203; -- for interest; -- for attorneys' fees and costs; -- for the difference between earned overtime wages and the paid overtime wages, earned for hours worked in excess of eight in a day of 40 in a week; -- for statutory waiting time penalties up to 30 days; -- for all unpaid overtime wages earned for hours worked in excess of 40 in a week; -- for liquidated damages; -- for indemnification of costs and associated with the purchasing of defendants' shirts with the defendants' logo on them; -- for indemnification of costs associated with maintaining the uniform shirts; -- for damages and penalties for violation of Labor Code Section 226; and -- for restitution to the class of wages owed. The suit is "Manuel Rubio et al. v. Fry's Electronics et al., Case No. 108CV-106994," filed with the Superior Court of the State of California, County of Santa Clara. Representing the plaintiffs are: Peter K. Levine, Esq. Albert J. Gopin, Esq. 5455 wilshire Boulevard. Suite 1259 Los Angeles, California 90036 Phone: (323) 934-1234 Fax: (323) 934-1230 e-mail: frys.peterlevine@neverbox.com GILEAD SCIENCES: Nixing of CA Securities Lawsuit Still on Appeal ---------------------------------------------------------------- The dismissal by the U.S. District Court for the Northern District of California of the fourth amended complaint in a consolidated securities fraud lawsuit against Gilead Sciences, Inc. is still on appeal. On May 12, 2006, the federal court executed orders dismissing in its entirety and with prejudice the fourth consolidated amended complaint associated with a purported class action against: -- the company, -- the chief executive officer, -- chief financial officer, -- former executive vice president of operations, -- executive vice president of research and development, -- senior vice president of manufacturing, and -- senior vice president of research. The complaint is generally alleging that the defendants violated federal securities laws, specifically Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated by the Securities and Exchange Commission, by making certain alleged false and misleading statements. The plaintiffs have appealed the dismissal. The company reported no development in the matter in its Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "In re Gilead Sciences Securities litigation, Case No. 03-CV-4999," filed with the U.S. District Court for the Northern District of California, Judge Martin J. Jenkins presiding. Representing thee plaintiffs are: Eric J. Belfi, Esq. Labaton Sucharow & Rudoff LLP 100 Park Avenue New York, NY 10017 Phone: 212-907-0878 Fax: 212-818-0477 e-mail: ebelfi@labaton.com Robert S. Green, Esq. Green Welling LLP 595 Market Street, Suite 2750 San Francisco, CA 94105 Phone: 415-477-6700 Fax: 415-477-6710 e-mail: RSG@CLASSCOUNSEL.COM - and - David Jude George, Esq. Coughlin Stoia Geller Rudman & Robbins LLP 120 East Palmetto Park Road - Suite 500 Boca Raton, FL 33432 Phone: (561) 750-3000 Fax: (561) 750-3364 e-mail: dgeorge@csgrr.com Representing the defendants are: John C. Dwyer, Esq. Grant P. Fondo, Esq. Cooley Godward, LLP Five Palo Alto Square, 3000 El Camino Real Palo Alto, CA 94306-2155 Phone: 650-843-5000 Fax: 650-857-0663 e-mail: dwyerjc@cooley.com gfondo@cooley.com GORTON'S SEAFOOD: Recalls Adulterated Battered Fish Fillets ----------------------------------------------------------- Gorton's Seafood, based in Gloucester, Mass., is voluntarily recalling one frozen seafood product with a specific date code because the product may have been adulterated with pills. While there has been only one isolated case of adulteration and no reports of illness from the product, the company is taking this action as a precautionary measure. The following product is subject to recall: * Gorton's 6 Crispy Battered Fish Fillets 11.4 oz -- UPC #4440015770 Date code: 7289G1 Best if used by date: April 2009 The product included in this recall was produced on October 16, 2007, and distributed to retail outlets in Alabama, California, Delaware, Florida, Georgia, Mississippi, Oklahoma, Pennsylvania, South Carolina, Tennessee and Texas. The product is being removed from retail outlets, and consumers are urged to look in their freezers for products bearing this particular code. Gorton's is conducting an investigation into the source of the problem and working with the Pennsylvania Department of Agriculture and the Food & Drug Administration. There have been no reported illnesses from consumers. Consumers who have the product may return it to Gorton's for a refund by calling 800-896-9479. Consumers may report any complaints to FDA's local district complaint coordinators located on the FDA web site: http://www.fda.gov/opacom/backgrounders/complain.html INFATINO LLC: Recalls Infant Rattles Due to Choking Hazard ---------------------------------------------------------- Infantino LLC, of San Diego, Calif., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 2,000 Infantino Lamb Grabby Rattles. The company said the tail-piece on the rattles can detach, posing a choking hazard to young children. Infantino has received eight reports of the tail piece on the rattle detaching. No injuries have been reported. The recalled Infantino Lamb Grabby Rattles are shaped like a lamb with an Infantino elliptical-shaped logo stamped on the front right foot of the lamb. Only rattles with date code 0907 printed on the back of the left ear of the lamb are included in the recall. The production batch code is printed in a dial format with the year in the middle of a circle and an arrow pointing to the number on the circle that indicates the month. Rattles that do not have a date code are not included in the recall. These recalled rattles were manufactured in China and were being sold at Wal-Mart, Babies "R" Us and other specialty stores nationwide from September 2007 through February 2008 for between $3 and $4. Picture of the recalled rattle is found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08208a.jpg Consumers are advised to immediately take the recalled toys away from young children and contact Infantino for a replacement rattle or a product of equal value. For additional information, contact Infantino toll-free at (888) 808-3111 between 8:00 a.m. And 4:00 p.m. PT or visit the firm's Web site: http://service.infantino.com LORILLARD INC: Faces Calif. Tobacco Marketing, Advertising Suits ---------------------------------------------------------------- Lorillard, Inc., a wholly owned subsidiary of Loews Corp., continues to face class actions in California that were on appeal to the either the California Supreme Court or the U.S. Supreme Court, according to the Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. Brown Litigation One of the suits is "Brown v. The American Tobacco Company, Inc., et al.," which was filed with the Superior Court, San Diego County, California on June 10, 1997. The California court granted defendants' motion to decertify the class. The class decertification order was affirmed on appeal, but the California Supreme Court has agreed to hear the case. The class originally certified in "Brown" was composed of residents of California who smoked at least one of defendants' cigarettes between June 10, 1993 and April 23, 2001 and who were exposed to defendants' marketing and advertising activities in California. Daniels Litigation The second case is "Daniels v. Philip Morris, Incorporated, et al.," which was filed with the Superior Court, San Diego County, California on Aug. 2, 1998. The court granted defendants' motion for summary judgment during 2002 and dismissed the case. Both the California Court of Appeal and the California Supreme Court have affirmed the case's dismissal. The plaintiffs have petitioned the U.S. Supreme Court to review "Daniels," but the Court has not determined whether it will hear the case. Prior to granting defendants' motion for summary judgment, the court had certified a class composed of California residents who, while minors, smoked at least one cigarette between April 1994 and Dec. 31, 1999 and were exposed to defendants' marketing and advertising activities in California. Loews Corp. -- http://www.loews.com-- is a holding company, whose lines of business its subsidiaries are engaged in include commercial property and casualty insurance (CNA Financial Corporation (CNA), an 89%-owned subsidiary); production and sale of cigarettes (Lorillard, Inc. (Lorillard), a wholly owned subsidiary); operation of offshore oil and gas drilling rigs (Diamond Offshore Drilling, Inc., a 51%-owned subsidiary); exploration, production and marketing of natural gas and natural gas liquids (HighMount Exploration & Production LLC, a wholly owned subsidiary); operation of interstate natural gas transmission pipeline systems (Boardwalk Pipeline Partners, LP, a 70%-owned subsidiary), and operation of hotels (Loews Hotels Holding Corporation, a wholly owned subsidiary). LORILLARD INC: Fla. Court Decertifies Class in "Engle" Lawsuit -------------------------------------------------------------- The Circuit Court, Dade County, Florida entered an order that formally decertified the class in the matter, "Engle v. R.J. Reynolds Tobacco Co., et al.," which names Lorillard, Inc., a wholly owned subsidiary of Loews Corp., as one of the defendants. The case was originally filed with the Circuit Court, Dade County, Florida on May 5, 1994. It was later certified as a class action on behalf of Florida residents, and survivors of Florida residents, who were injured or died from medical conditions allegedly caused by addiction to smoking. The case was tried between 1998-2000 in a multi-phase trial that resulted in verdicts in favor of the class. During 2006, the Florida Supreme Court issued a ruling that, among other things determined that the case could not proceed further as a class action. During February 2008, the trial court entered an order on remand from the Florida Supreme Court that formally decertified the class, according to Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. Loews Corp. -- http://www.loews.com-- is a holding company, whose lines of business its subsidiaries are engaged in include commercial property and casualty insurance (CNA Financial Corporation (CNA), an 89%-owned subsidiary); production and sale of cigarettes (Lorillard, Inc. (Lorillard), a wholly owned subsidiary); operation of offshore oil and gas drilling rigs (Diamond Offshore Drilling, Inc., a 51%-owned subsidiary); exploration, production and marketing of natural gas and natural gas liquids (HighMount Exploration & Production LLC, a wholly owned subsidiary); operation of interstate natural gas transmission pipeline systems (Boardwalk Pipeline Partners, LP, a 70%-owned subsidiary), and operation of hotels (Loews Hotels Holding Corporation, a wholly owned subsidiary). LORILLARD INC: La. High Court Denies Review Petitions in "Scott" ---------------------------------------------------------------- The Louisiana Supreme Court denied both parties' separate petitions for review of the matter, "Scott v. The American Tobacco Company, et al.," which names Lorillard, Inc., a wholly owned subsidiary of Loews Corp. The suit was filed with District Court, Orleans Parish, Louisiana on May 24, 1996. It was filed as a class action on behalf of certain cigarette smokers resident in the State of Louisiana. In June 2004, the court entered a final judgment in favor of the plaintiffs in the case. The plaintiffs in the case were awarded approximately $591 million to fund cessation programs for Louisiana smokers. The court final judgment also reflected its award of prejudgment interest. In February 2007, the Louisiana Court of Appeal issued a ruling that, among other things: -- reduced the amount of the award by approximately $328 million; -- struck the award of prejudgment interest, which totaled approximately $440 million as of Dec. 31, 2006; and -- ruled that the only class members who are eligible to participate in the smoking cessation program are those who began smoking by Sept. 1, 1988, and whose claims accrued by Sept. 1, 1988. The Louisiana Court of Appeal has returned the case to the trial court for further proceedings. During January 2008, the Louisiana Supreme Court denied plaintiffs' and defendants' separate petitions for review, according to Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. Loews Corp. -- http://www.loews.com-- is a holding company, whose lines of business its subsidiaries are engaged in include commercial property and casualty insurance (CNA Financial Corporation (CNA), an 89%-owned subsidiary); production and sale of cigarettes (Lorillard, Inc. (Lorillard), a wholly owned subsidiary); operation of offshore oil and gas drilling rigs (Diamond Offshore Drilling, Inc., a 51%-owned subsidiary); exploration, production and marketing of natural gas and natural gas liquids (HighMount Exploration & Production LLC, a wholly owned subsidiary); operation of interstate natural gas transmission pipeline systems (Boardwalk Pipeline Partners, LP, a 70%-owned subsidiary), and operation of hotels (Loews Hotels Holding Corporation, a wholly owned subsidiary). LORILLARD INC: Plaintiff in "Sanders" Seeks Supreme Court Review ---------------------------------------------------------------- The plaintiff in the matter, "Sanders v. Lockyer, et al., Case No. 3:04-cv-02281-SI," which was filed with U.S. District Court for Northern District of California is seeking for a review of the dismissal of the case from the U.S. Supreme Court. On June 9, 2004, Lorillard, Inc., a wholly owned subsidiary of Loews Corp., and other major cigarette manufacturers, along with the Attorney General of the State of California, were sued by a consumer purchaser of cigarettes in a putative class action alleging violations of the Sherman Act and California state antitrust and unfair competition laws. The plaintiff seeks treble damages of an unstated amount for the putative class as well as declaratory and injunctive relief. All claims are based on the assertion that the Master Settlement Agreement (http://ag.ca.gov/tobacco/msa.php)together with certain implementing legislation enacted by the state of California, constitute unlawful restraints of trade. On March 28, 2005 the defendants' motion to dismiss the suit was granted. Plaintiff appealed the dismissal to the U.S. Court of Appeals for the Ninth Circuit. Argument was heard on Feb. 15, 2007, and the Ninth Circuit issued an opinion on Sept. 26, 2007 affirming dismissal of the suit. On Jan. 25, 2008, the plaintiff filed a petition seeking certiorari from the U.S. Supreme Court, according to Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "Sanders v. Lockyer, et al., Case No. 3:04-cv-02281- SI," filed with U.S. District Court for Northern District of California, Judge Susan Illston presiding. Representing the plaintiffs are: Thad Alan Davis, Esq. Quinn Emanuel Urquhart Oliver & Hedges, LLP 865 S. Figueroa St., 10th Floor Los Angeles, CA 90017 Phone: 213-443-3000 e-mail: thaddavis@quinnemanuel.com Representing the defendants are: D. Eric Shapland, Esq. Heller Ehrman White & McAuliffe LLP 601 S. Figueroa Street 40th Floor Los Angeles, CA 90017-5758 Phone: 213-689-0200 Fax: 213-614-1868 e-mail: eshapland@hewm.com Margaret Eve Spencer, Esq. California Attorney General Antitrust 455 Golden Gate Avenue San Francisco, CA 94102-3664 Phone: 415-703-5543 Fax: 415-703-5480 e-mail: margaret.spencer@doj.ca.gov - and - Patrick J. Gregory, Esq. Shook Hardy & Bacon LLP 333 Bush Street, Suite 600 San Francisco, CA 94104 Phone: 415-544-1900 Fax: 415-391-0281 e-mail: pgregory@shb.com LORILLARD INC: Second Circuit Stays Proceedings in "Schwab" Case ---------------------------------------------------------------- The U.S. Court of Appeals for the Second Circuit has stayed proceedings in the matter, "[Schwab] McLaughlin v. Philip Morris USA, Inc. et al., Case No. 1:04-cv-01945-JBW-SMG," which was filed with the U.S. District Court for the Eastern District of New York, and names Lorillard, Inc., a wholly owned subsidiary of Loews Corp., as one of the defendants. The case is a nationwide "lights" class action that was filed on May 11, 2004, in the U.S. District Court for the Eastern District of New York several tobacco manufacturers, including Lorillard, Inc. (Class Action Reporter, July 17, 2007). The plaintiffs seek compensatory and treble damages against each defendant, jointly and severally, for all losses and damages suffered as a result of the defendants' alleged wrong-doings complained of, including pre- and post-judgment interest, costs and disbursements of the action, including attorneys' fees and experts' fees and costs. They also seek temporary, preliminary and permanent equitable and/or injunctive relief, including enjoining future wrong- doing, rescission, disgorgement of defendants' ill-gotten funds, and attaching, impounding or imposing a constructive trust upon or otherwise restricting the proceeds of defendants' ill-gotten funds. The plaintiffs brought the case pursuant to the Racketeer Influenced and Corrupt Organizations Act, challenging the practices of the defendants in connection with the manufacturing, marketing, advertising, promotion, distribution and sale of cigarettes that were labeled as "lights" or "light." They have estimated damages to the class to be in the hundreds of billions of dollars. Any damages awarded to the plaintiffs based on defendants violation of the RICO statute would be trebled. The case was certified as a nationwide class action involving lights cigarettes. Defendants including the company appealed the certification to the U.S. Court of Appeals for the Second Circuit. The Second Circuit has agreed to review the class certification order, and it has stayed all activity before the trial court until the appeal is concluded, according to Loews Corp.'s Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit is "[Schwab] McLaughlin v. Philip Morris USA, Inc. et al., Case No. 1:04-cv-01945-JBW-SMG," filed with the U.S. District Court for the Eastern District of New York, Judge Jack B. Weinstein presiding. Representing the plaintiffs are: Linda P. Nussbaum, Esq. Kaplan Fox & Kilsheimer, LLP 805 Third Avenue, 22nd Floor New York, NY 10022 Phone: 212-687-1980 Fax: 212-687-1980 (fax) e-mail: lnussbaum@kaplanfox.com William P. Butterfield, Esq. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. 1100 New York Ave. NW, Ste. 500, West Tower Washington, D.C. 20005 Phone: 202.408.4600 Fax: 202.408.4699 e-mail: wbutterfield@cmht.com Representing the defendants are: Mark A. Belasic, Esq. Jones Day 901 Lakeside Avenue, North Point Cleveland, OH 44114 Phone: (216) 586-3939 Fax: 216-579-0212 e-mail: mabelasic@jonesday.com - and - Peter A. Bellacosa, Esq. Kirkland & Ellis Citigroup Center 153 East 53rd Street New York, NY 10022-4675 Phone: (212) 446-4800 Fax: (212) 446-4900 e-mail: peter_bellacosa@ny.kirkland.com LUFKIN INDUSTRIES: Liability in "Discrimination Impact" Affirmed ---------------------------------------------------------------- The 5th Circuit Court of Appeals gave a split decision on Feb. 29, 2008, in a class action lawsuit charging Lufkin Industries with racially unfair hiring and promotion policies, The Lufkin Daily News reports. According to Lufkin Daily, the Appeals Court affirmed Lufkin Industries' liability for the "discriminatory impact" of a history of subjective promotional policies. However, the Court refused the charge that the company was unfair to blacks in hiring for the foundry division. The Court, in its 26-page decision, described the 12-year-old suit a "wide-ranging, complex discrimination case." It is known to be the largest class-action of its kind, Lufkin Daily says. The report recalls that in 2005, a federal court awarded $3.4 million in back pay to the nearly 700 employees named in the suit for decades of alleged racial workplace behavior and hiring practices. To date, no money has been awarded in the case. A split decision, Lufkin Daily notes, means that the decision on how much money to pay to the employees and attorneys involved will be saved for another time. Nacogdoches attorney Tim Garrigan, Esq., who represents the class members, said that the Appeals Court's affirmation of the case "means that civil rights are still viable here in East Texas." The suit is "McClain, et al., v. Lufkin Industries, Case No. 9:97-cv-00063-HC," filed with the U.S. District Court for the Eastern District of Texas, under Judge Howell Cobb. Representing the plaintiffs are: Morris J. Baller, Esq. (mjb@gdblegal.com) Goldstein Demchak Baller Borgen 300 Lakeside Dr., Suite 1000 Oakland, CA 94612 Phone: 510-763-9800 Fax: 15108351417 Timothy B. Garrigan, Esq. (tbgstugar@cox-internet.com) Stuckey Garrigan & Castetter 2803 North Street, P.O. Box 631902 Nacogdoches, TX 75963-1902 Phone: 936/560-6020 Fax: 19365609578 Representing the company is: Christopher V. Bacon, Esq. (cbacon@velaw.com) Vinson & Elkins 1001 Fannin St., Suite 2300 Houston, TX 77002-6760 Phone: 713/758-2222 Fax: 17136155014 MERCURY INSURANCE: Settles Claims Valuation Suit in California -------------------------------------------------------------- A tentative settlement was reached in a class action questioning Mercury Insurance Corp.'s use of certain automated database vendors to assist in valuing claims for medical payments, according to the company's Feb. 27, 2008 Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Dec. 31, 2007. The suit, "Marissa Goodman, et al. v. Mercury Insurance Co." was filed with the Los Angeles Superior Court on June 16, 2002. The plaintiff filed a motion seeking class-action certification to include all of the company's insureds from 1998 to the present who presented a medical payments claim, had the claim reduced using the computer program and whose claim did not reach the policy limits for medical payments. On Jan. 11, 2007, the Court certified the requested class, and class notice has been sent to approximately 14,000 class members. The Company has appealed the class certification ruling, and the Court of Appeal has stayed the case pending their review. The Plaintiff alleges that these automated databases systematically undervalue medical payment claims to the detriment of insureds. The Plaintiff is seeking actual and punitive damages. The case has been coordinated with two other similar cases, and also with ten other cases relating to total loss claims. The Court denied the Company’s Motion for Summary Judgment holding that there is an issue of fact as to whether Ms. Goodman sustained any damages as a result of the Company’s handling of her medical payments claim. The Company and the Plaintiff have agreed to settle the claims for an amount that is immaterial to the Company’s operations and financial position. The settlement is subject to review and approval by the Court. Mercury General Corp. -- http://www.mercuryinsurance.com-- and its subsidiaries are engaged primarily in writing automobile insurance principally in California. MICROSOFT: e-Mails Show Knowledge of Error in "Vista" Lawsuit ------------------------------------------------------------- Internal Microsoft e-mail messages released with court documents in a class-action suit suggest that the software giant bowed to pressure from Intel Corp. in the run-up to the release of Windows Vista, allowing computers to be labeled "Windows Vista Capable" despite concerns that they were not up to the task of running the operating system, news.ebrandz.com reports. According to the report, a Microsoft executive said that Microsoft was pressured by partner Intel Corp. to certify some chips as capable of running the Windows Vista operating system to help Intel meet earnings estimates. The e-mail has come to light as a result of a lawsuit filed in March 2007 against Microsoft, news.ebrandz points out. The e-mails were introduced as evidence in the case, which was recently granted class-action status. As reported in the Class Action Reporter on Feb. 25, 2008, Judge Marsha Pechman of the U.S. District Court for the Western District of Washington granted class-action status to the lawsuit, which is alleging that Microsoft unjustly enriched itself by promoting PCs as "Windows Vista Capable" even when they could only run a bare-bones version of the operating system called "Vista Home Basic." The slogan, CAR noted, was emblazoned on PCs during the 2006 holiday shopping season as part of a campaign by Microsoft to maintain sales of Windows XP computers after the launch of Windows Vista was delayed. According to news.ebrandz, the e-mails show that the company's own executives were frustrated by hardware requirements for Vista. The e-mails also suggest that Intel was worried about keeping up with demand, so it put pressure on Microsoft to lower its standards for the "Vista Ready" marketing program and accept an older chip that could not run Vista's Aero interface. Aero, news.ebrandz explains, is one of the most marketed features in Vista; it is the cool-looking graphical interface that critics say resembles a Mac. However, Aero only works with PCs running newer graphics hardware. The lawsuit alleges that the e-mail messages show that Microsoft went along with misrepresenting the capabilities of computers with some Intel chipsets, and that consumers wound up with badly working computers as a result. news.ebrandz notes that the decision was made over the objection of some Microsoft officials, who expressed concern that Intel's 915 chipset was not capable of properly displaying Vista's graphics features, according to e-mails released on Feb. 27, 2008. "In the end, we lowered the requirements to help Intel make their quarterly earnings so they could continue to sell motherboards with the 915 graphics embedded," John Kalkman, a Microsoft general manager who handles relations with personal- computer makers, said in one message. Motherboards are the main circuit boards in PCs. In another message, executive Mike Ybarra put it more succinctly: "We are caving to Intel." In a statement, Microsoft said the e-mail messages "reflect part of an active discussion about how best to implement the Windows Vista Capable program." Vista was widely released in January 2007. Microsoft confirmed the authenticity of the e-mails on March 2, 2008. Intel, the biggest maker of computer processors, said the messages' allegations were unfounded. "With respect to the statement in the e-mail from one John Kalkman, we have no idea who he is and we are absolutely certain he would have zero visibility into Intel's financials, Intel's financial forecasts or anything to do with any particular quarter at any time," said Chuck Mulloy, a spokesman for the Santa Clara, California-based Intel. The Seattle Post-Intelligencer's Todd Bishop got its hands on the entire 300-pages worth of Microsoft e-mails that are part of the lawsuit regarding Microsoft's Vista Capable logo program. The e-mails (a 3.5-MB PDF file) can be accessed at: http://blog.seattlepi.nwsource.com/microsoft/library/vistaexhibitsone.pdf The suit is "Kelley v. Microsoft Corp., Case No. 2:07-cv-00475- MJP," filed with the U.S. District Court for the Western District of Washington under Judge Marsha J. Pechman. Representing the plaintiff is: Gordon Murray Tilden, LLP 1001 4th Ave., Ste. 4000, Seattle, WA 98154 Phone: 206-467-6477 Fax: 206-467-6292 e-mail: office@gmtlaw.com Web site: http://www.gmtlaw.com NEW YORK: Sued by Two Men Busted on Loitering Law ------------------------------------------------- Two men busted on a loitering law declared unconstitutional 25 years ago have filed a federal class-action suit accusing New York City and the New York Police Department of false arrest, Daily News reports. If the suit is certified as a class-action case, it will cover others illegally arrested and could cost the city a considerable amount of money, according to the report. A Daily News computer review found that 2,513 people have been arrested under the law since it was thrown out in 1983. The suit is related to a pending class-action case accusing the NYPD of arresting thousands of people under an anti-panhandling law that was ruled unconstitutional in 1992. In 2006, the city agreed to pay former beggar Eddie Wise $100,000 to drop his complaint. That suit remains active as dozens more panhandlers came forward with similar claims. In the new suit, Paul Casale, a midtown ad agency coordinator, and Anthony Garcia, a married Brooklyn dad, were busted at the Port Authority in March 2007 and strip-searched. Mr. Casale, who lives on the upper West Side, was walking with Mr. Garcia, who is on public assistance, when they were approached by cops on a sidewalk outside the bus depot, their lawyers said. Mr. Casale, who had never before been arrested, had run into Mr. Garcia, a friend, who had just put a woman friend on a bus. Katie Rosenfeld, Esq., said it was unclear why the two men were arrested but the cops did so under a law voided in 1988. The men were taken into custody under a law that made a person guilty of loitering if they were unable to give a "satisfactory explanation" as to why they were in a transportation facility. "This action seeks to end -- finally, for all time -- this pattern and practice of unconstitutional conduct by police officers in the NYPD," the suit says. "You can't arrest someone for not having a sufficient explanation -- but they do," said Matthew Brinckerhoff, Esq., another lawyer on the case. "It's even crazier when [the statute is] long dead." The men are suing even though the charges were eventually dropped. The suit also challenges the enforcement of a second subsection of the penal code, one that made it illegal to solicit "deviant" sex in a public place. QUAKER OATS: Recalls Pancake, Waffle Mixes Posing Health Risk ------------------------------------------------------------- The Quaker Oats Co. announced the products in the recall are a small quantity of Aunt Jemima Pancake & Waffle Mix: Original, Original Complete and Buttermilk Complete, which may have potential salmonella contamination. No other Aunt Jemima, frozen Aunt Jemima or Quaker products are affected. The products, sold in 2 pound and 5 pound boxes with Best Before dates of "FEB 08 09 H" through "FEB 16 09 H" stamped on the top, contain the following UPC codes: * 30000 43272: Aunt Jemima Buttermilk Complete, 5 lb. * 30000 05040: Aunt Jemima Original, 2 lb. * 30000 05070: Aunt Jemima Original Complete, 2 lb. * 30000 05300: Aunt Jemima Buttermilk Complete, 2 lb. Salmonella is a food borne illness that can cause serious and sometimes fatal infections in young children, frail or elderly people, and others with weakened immune systems. Healthy persons infected with salmonella often experience fever, diarrhea, nausea, vomiting and abdominal pain. No illnesses have been reported in connection with this issue to date. There is very low risk of illness when preparation directions on box are followed and product is not consumed raw or undercooked. Salmonella bacteria is killed at a temperature of 160� F. If consumers have this product with the indicated UPC codes and Best Before dates, they should return it to the place of purchase for a full refund. Consumers with questions may contact the company by calling the toll-free hotline at 1-800- 407-2247 or by logging onto http://www.auntjemima.com. Quaker is in the process of recovering the product involved. Quaker knows specifically to which customer warehouses the product was shipped. Approximately 98% of the product is within Quaker's control. The 2% of product which is outside of Quaker's control was shipped to a limited number of retail and mass merchandiser stores (no direct distribution to West Coast). Of that small quantity, the vast majority likely has not been placed on store shelves. Product was shipped to 17 states including Texas, Georgia, Alabama, South Carolina, North Carolina, Illinois, Florida, Missouri, Minnesota, Colorado, Wisconsin, Ohio, New York, New Mexico, Kansas and Utah. REBELETTE INTL: Recalls Hoodies Posing Strangulation Hazard ----------------------------------------------------------- Rebelette International Trading Corp., of South El Monte, Calif., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 4,800 Girls' Hooded Sweatshirts. The sweatshirt jackets have a drawstring through the hood which poses a strangulation hazard to children. In February 1996, CPSC issued guidelines to help prevent children from strangling or getting entangled on the neck and waist by drawstrings in upper garments, such as jackets and sweatshirts. No injuries have been reported. The recalled hooded sweatshirts have a drawstring at the neck. They zip up the front, and are either blue with pink stripes on the sleeves with "Red Hot Chili Steppers" printed on the front, or brown with blue stripes on the sleeves with "Powder Puffs Touch League" on the front. The sweatshirts were sold in children's sizes small, medium, large, and sizes 4, 5, 6, and 6X. "REBELETTE of Los Angeles" is printed on the collar label. These recalled hoodies were manufactured in China and were being sold at Marshalls Stores and specialty children's clothing retailers nationwide from July 2007 through September 2007 for about $15. Pictures of the recalled hoodies are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08207a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08207c.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08207b.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08207d.jpg Consumers should immediately remove the drawstring from the hood to eliminate the hazard, or return the sweatshirt to either the place of purchase or to Rebelette International for a full refund. For additional information, contact Rebelette International collect at (626) 448-9988 between 9:00 a.m. And 5:00 p.m. PT Monday through Friday. New Securities Fraud Cases ENERNOC INC: Federman & Sherwood Announces Securities Fraud Suit ---------------------------------------------------------------- On March 4, 2008, a class action lawsuit was filed with the United States District Court for the District of Massachusetts against EnerNoc, Inc. The complaint alleges violations of federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, including allegations of issuing a series of material misrepresentations to the market which had the effect of artificially inflating the market price. The class period is from November 1, 2007, through February 27, 2008. The plaintiff seeks to recover damages on behalf of the class. Interested parties may move the court no later than May 5, 2008, for lead plaintiff appointment. For more information, contact: William B. Federman, Esq. (wfederman@aol.com) Federman & Sherwood 10205 North Pennsylvania Avenue Oklahoma City, OK 73120 Web site: http://www.federmanlaw.com ENERNOC INC: Roy Jacobs Files Securities Fraud Lawsuit in Mass. --------------------------------------------------------------- Roy Jacobs & Associates commenced a class action lawsuit with the United States District Court for the District of Massachusetts on behalf of a class of all persons who purchased or acquired securities of EnerNOC, Inc. in the open market from November 1, 2007, through February 27, 2008, or in the Offering which closed on or about November 19, 2007. The Complaint alleges that EnerNOC presented itself throughout the Class Period as a company that was growing rapidly, and one which was able to provide services and book revenues on an almost immediate basis. At the end of the Class Period, however, EnerNOC revealed, among other things, that: (1) ballooning operational and compensation expenses were outpacing revenue growth, resulting in losses greater than the market expected; and (2) that an increasing number of EnerNOC's forward capacity contracts involve substantial upfront costs, but a prolonged "lag" in the ability to recognize revenue. Upon the announcement of this adverse news, EnerNOC's shares dropped almost 30% in heavy trading, wiping out over $100 million in shareholder value. On November 1, 2007, the Company's Chairman and Chief Executive Officer, Timothy Healey, told analysts that the Company's sales force was driving rapid organic revenue growth, but failed to adequately reveal adverse expense trends, and the fact that an increasing number of "megawatts under management" involve prolonged lags in the Company's ability to recognize revenue. Then, on November 19, 2007, the Company and certain insiders sold 2.5 million EnerNOC shares at $43.00 per share in a secondary offering (the Offering). Mr. Healey sold over 64,000 of his own shares for proceeds of approximately $2.7 million, and David Brewster, the Company's President sold approximately 140,000 of his own shares for proceeds of $6 million. In all, 2.5 million shares were sold for proceeds of over $100 million, including substantial shares sold by large investors who have representatives on EnerNOC's Board of Directors. The Prospectus for the Secondary Offering failed to reveal the material adverse facts set forth above. Interested parties may move the court no later than May 5, 2008, for lead plaintiff appointment. For more information, contact: Roy L. Jacobs, Esq. (rjacobs@jacobsclasslaw.com) Roy Jacobs & Associates 60 East 42nd Street 46th Floor New York, NY 10165 Phone: 1-888-884-4490 Web site: http://www.jacobsclasslaw.com SLM CORP: Charles Johnson Announces Filing of NY Securities Suit ---------------------------------------------------------------- Charles H. Johnson & Associates announced that a class action has been commenced with the United States District Court for the Southern District of New York on behalf of purchasers of SLM Corporation -- Sallie Mae -- publicly traded securities during the period January 18, 2007, through January 3, 2008. The Complaint alleges that Sallie May and certain of its officers and directors violated federal securities laws by issuing a series of materially false and misleading statements. Specifically, Defendants concealed the following: 1) the Company failed to engage in proper due diligence in originating student loans to subprime borrowers, particularly those attending non-traditional institutions; 2) the Company was not adequately reserving for uncollectible loans in its non-traditional portfolio; 3) the Company had far greater exposure to anticipated losses and defaults related to its non-traditional loan portfolio than previously disclosed; and 4) given the deterioration of the subprime market and reductions in federal subsidies, the Company would be forced to tighten lending standards on both federal loans and private education loans which would have a direct material negative impact on its loan originations going forward. On January 3, 2008, the Company disclosed that it would be cutting back on its core business of lending to students by being "more selective" in making students loans due to turmoil in the credit markets and a new federal law that slashed subsidies to the private companies that make government-backed student loans. On this news, Sallie Mae's stock dropped $2.49 per share to close at $16.67 per share. Sallie Mae traded as high as $57.98 per share in July 2007. Interested parties may move the court no later than March 31, 2008, for lead plaintiff appointment. For more information, contact: Neal Eisenbraun, Esq. (cjohnsonlaw@gmail.com) Charles H. Johnson & Associates 2599 Mississippi Street New Brighton, MN 55112 Phone: (651) 633-5685 Asbestos Alerts ASBESTOS LITIGATION: Appeals Court OKs Dismissal of Beavers Case ---------------------------------------------------------------- The U.S. Court of Appeals, 11th Circuit, affirmed the ruling of the U.S. District Court for the Northern District of Alabama, which dismissed an asbestos complaint filed by nearly 100 plaintiffs, including Vera L. Beavers. The case was filed against A.O. Smith Electrical Products Company (a division of The A.O. Smith Corporation), A.O. Smith Corporation, A.W. Chesterton Company, Albany International Inc., American Optical Corporation, Crown Cork & Seal Company, Inc., Crown Holdings, Inc., Kelly-Moore Paint Company, Borg Warner Corp., by and through its successor in interest, Borgwarner Morse Tec Inc., Exteco, Inc. f/k/a Thermo Electric Co., Inc., Marley-Wylain Co. d/b/a Weil-Mclain Co., Inc., Honeywell Inc., John Crane Inc. and other defendants. Circuit Judges Tjoflat, Black, and Carnes entered judgment of Case Nos. 06-15401, 07-11401 on Feb. 13, 2008. In this case, which is not a class action, the plaintiffs, nearly 100 individuals, appealed the district court's dismissal of their complaint for lack of subject matter jurisdiction, as well as the court's denial of their subsequent motion for relief from judgment. The complaint, which sought damages for personal injury and wrongful death resulting from exposure to asbestos, alleged that the court had diversity jurisdiction. However, the district court determined that it lacked subject matter jurisdiction because there was not complete diversity among the parties. Specifically, the complaint contained plaintiffs and defendants that were both alleged to be from California and Georgia. Accordingly, on Aug. 31, 2006, the court dismissed the complaint. On Oct. 2, 2006, the plaintiffs filed a notice of appeal, challenging the district court's dismissal of their complaint. On that same day, the plaintiffs moved for relief from judgment. The plaintiffs also moved to sever each plaintiff's claim and to amend their complaint. On Oct. 25, 2006, the district court struck the plaintiffs' motion for relief from judgment because it believed that the pending appeal stripped it of jurisdiction over the motion. On the next day, the plaintiffs filed a motion for reconsideration. The district court held a hearing on the plaintiffs' motion on Jan. 9, 2007, and the next day, Jan. 10, 2007, denied their. On Jan. 19, 2007, the plaintiffs filed a motion to reopen the case and to file their proposed amended complaint, which was attached to the motion. The district court denied that motion on Feb. 28, 2007, for want of jurisdiction because the case was still pending on appeal in this Court. On March 12, 2007, the plaintiffs filed with the district court a motion for an extension of time to appeal the court's Jan. 10, 2007, order denying their motion. The district court granted the plaintiffs' motion, and the plaintiffs appealed the district court's order denying their motion. The district court properly denied the plaintiffs' Rule 60(b) motion for relief. ASBESTOS LITIGATION: Temple-Inland Still Faces Exposure Actions ---------------------------------------------------------------- Temple-Inland Inc. is a defendant in various various lawsuits involving alleged workplace exposure to asbestos, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. These cases involve exposure to asbestos in premises owned or operated by the Company. It does not manufacture any products that contain asbestos and all its cases in this area are limited to workplace exposure claims. Historically, the Company's aggregate annual settlements related to asbestos claims have been about US$1 million. The number of claims has remained relatively constant in the past few years despite the fact that most of the claims relate to a facility the Company sold at the end of 1999. Austin, Tex.-based Temple-Inland Inc. manufactures corrugated packaging and building products. ASBESTOS LITIGATION: United Fire's A&E Loss Reserves Total $5Mil ---------------------------------------------------------------- United Fire & Casualty Company's direct and assumed asbestos and environmental loss reserves were US$5 million at Dec. 31, 2007, compared with US$3.5 million at Dec. 31, 2006, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company's ceded A&E loss reserves were US$1.9 million at Dec. 31, 2007, compared with US$600,000 at Dec. 31, 2006. Cedar Rapids, Iowa-based United Fire & Casualty Company is engaged in the business of writing property and casualty insurance and life insurance. The Company reports its operations in two business segments: property and casualty insurance and life insurance. As of Dec. 31, 2007, the Company employed 667 full-time employees. ASBESTOS LITIGATION: U.S. Steel's Cases Rise to 325 at Dec. 31 -------------------------------------------------------------- United States Steel Corporation, as of Dec. 31, 2007, face about 325 active asbestos cases involving about 3,000 plaintiffs, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. These cases include cases involving the businesses acquired from Lone Star Technologies, Inc. As of Sept. 30, 2007, the Company faced about 300 active asbestos cases involving about 3,050 plaintiffs, including cases involving the businesses acquired from Lone Star. (Class Action Reporter, Nov. 9, 2007) Many of these cases involve multiple defendants (typically from 50 to more than 100). Almost 2,650, or about 88 percent, of these claims are currently pending in jurisdictions which permit filings with massive numbers of plaintiffs. During 2007, the Company paid about US$9 million in settlements. These settlements, and other dispositions resolved about 1,230 claims. New case filings in 2007 added about 530 claims. At Dec. 31, 2006, the Company faced about 300 active cases involving about 3,700 plaintiffs. During 2006, the Company paid about US$8 million in settlements. These settlements, and other dispositions resolved about 5,150 claims. New case filings in 2006 added about 450 claims. Most claims filed in 2006 and 2007 involved individual or small groups of claimants as many jurisdictions no longer permit the filing of mass complaints. These asbestos cases allege a variety of respiratory and other diseases based on alleged exposure to asbestos. The Company is currently a defendant in cases in which a total of about 150 plaintiffs allege that they are suffering from mesothelioma. Pittsburgh-based United States Steel Corporation is an integrated steel producer with operations in North America and Central Europe. The Company has annual raw steel production capability of 31.7 million net tons (24.3 million tons in North America and 7.4 million tons in Central Europe) and is the fifth largest steel producer in the world. ASBESTOS LITIGATION: Universal Forest Has Site Cleanup Reserves --------------------------------------------------------------- Universal Forest Products, Inc. states that a reserve was established for its affiliate's facility in Thornton, Calif., to remove asbestos and certain lead containing materials, which existed on the property at the time of purchase. The reserve amount was not disclosed in the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. Grand Rapids, Mich.-based Universal Forest Products, Inc. engineers, manufactures, treats, distributes and installs lumber, composite wood, plastic and other building products to the do-it-yourself/retail, site-built construction, manufactured housing, and industrial markets. ASBESTOS LITIGATION: Sunoco Inc. Faces Potential 3rd Party Suits ---------------------------------------------------------------- Sunoco Inc. faces or may face claims alleging exposures of third parties to toxic substances, such as asbestos or benzene. No other matters were disclosed in the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. Philadelphia-based Sunoco, Inc., through its subsidiaries, is a petroleum refiner and marketer and chemicals manufacturer with interests in logistics and cokemaking. The petroleum refining and marketing, chemicals and logistics operations are conducted principally in the eastern half of the United States. The Company's cokemaking operations are conducted in Virginia, Indiana, Ohio and Vitoria, Brazil. ASBESTOS LITIGATION: Solutia Still Involved in Asbestos Lawsuits ---------------------------------------------------------------- Solutia Inc. is still involved in numerous asbestos-related proceedings, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company was in April 1977 by Pharmacia Corporation, which was then known as Monsanto Company (Old Monsanto) to hold and operate substantially all of the assets, and assume all of the liabilities of Old Monsanto's historical chemicals business. Pharmacia spun the Company off to Pharmacia's shareholders and the Company became an independent company in September 1977 (Solutia Spinoff). Pharmacia subsequently formed a new company, Monsanto Company, (Monsanto) to hold its agricultural and seed businesses and then spun Monsanto off to its shareholders as well. Monsanto also indemnified Pharmacia on a number of legal proceedings in which the Company was named defendant or were defending solely due to the Pharmacia related indemnification obligations. The legal proceedings relate to property damage, personal injury, products liability, premises liability or other damages relating to exposure to polychlorinated biphenyls, asbestos and other chemicals manufactured before the Solutia Spinoff. Defense and settlement costs as well as judgments, if any, are currently being funded by Monsanto for these matters. Monsanto's funding of these legal activities, and the resulting claim against the Company, which Monsanto has asserted in the Chapter 11 case, inclusive of the non-quantified unliquidated and contingent components of their claim, will be resolved via the Plan of Reorganization. The estimated unsecured claim amount, classified as a liability subject to compromise, was US$106 million as of Dec. 31, 2007, and US$111 million as of Dec. 31, 2006. St. Louis-based Solutia Inc. manufactures and markets high- performance chemical and engineered products that are used in consumer and industrial applications. The Company has 29 manufacturing facilities, eight technical centers and over 30 sales offices globally, including 20 facilities in the U.S. The Company employs about 6,000 individuals. ASBESTOS LITIGATION: Rogers Faces 175 Pending Claims at Dec. 30 --------------------------------------------------------------- Rogers Corporation faced about 175 pending asbestos-related claims as of Dec. 30, 2007, compared with about 148 pending claims as of Dec. 31, 2006, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company recorded about 177 pending asbestos-related claims filed against it as of Sept. 30, 2007. (Class Action Reporter, Nov. 16, 2007.) Over the past several years, there has been an increase in certain U.S. states in asbestos-related product liability claims brought against numerous industrial companies where the third- party plaintiffs allege personal injury from exposure to asbestos-containing products. The Company has been named as a defendant in some of these claims. In virtually all of these claims filed against the Company, the plaintiffs are seeking unspecified damages, or, if an amount is specified, it merely represents jurisdictional amounts or amounts to be proven at trial. The Company did not mine, mill, manufacture or market asbestos. Rather, the Company made some limited products, which contained encapsulated asbestos. Those products were provided to industrial users. The Company stopped manufacturing these products in 1987. The Company has been named in asbestos litigation primarily in Pennsylvania, Illinois, and Mississippi. Cases that the Company is involved in typically name 50-300 defendants, although some cases have had as few as one and as many as 833 defendants. The Company has obtained dismissals of many of these claims. In 2007, the Company was able to have about 59 claims dismissed (76 claims in 2006). In 2007, the Company has settled 12 claims (15 claims in 2006). The Company's insurance carriers have paid most costs, including the majority of costs associated with the small number of cases that have been settled. Those settlements totaled about US$2 million in 2007 and about US$5.1 million in 2006. Rogers Corporation develops and manufactures high performance, specialty-material-based products for various applications in diverse markets including: portable communications, communications infrastructure, computer and office equipment, consumer products, ground transportation, aerospace and defense. The Company is based in Rogers, Conn. ASBESTOS LITIGATION: Parsons Case v. Reynolds Units Still Stayed ---------------------------------------------------------------- An asbestos related lawsuit, which is pending in a West Virginia court and filed against Reynolds American Inc. subsidiaries: R. J. Reynolds Tobacco Co. and Brown & Williamson Holdings Inc., is still stayed, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. In Parsons v. A C & S, Inc. (a case filed in February 1998 in Circuit Court, Ohio County, W.Va.), the plaintiff sued asbestos manufacturers, U.S. cigarette manufacturers, including RJR Tobacco and B&W, and parent companies of U.S. cigarette manufacturers, including RJR, seeking to recover US$1 million in compensatory and punitive damages individually and an unspecified amount for the class in both compensatory and punitive damages. The class is brought on behalf of persons who allegedly have personal injury claims arising from their exposure to respirable asbestos fibers and cigarette smoke. The plaintiffs allege that Mrs. Parsons' use of tobacco products and exposure to asbestos products caused her to develop lung cancer and to become addicted to tobacco. The case has been stayed pending a final resolution of the plaintiffs' motion to refer tobacco litigation to the judicial panel on multi-district litigation filed in In Re: Tobacco Litigation in the Supreme Court of Appeals of West Virginia. On Dec. 26, 2000, three defendants, Nitral Liquidators, Inc., Desseaux Corporation of North American and Armstrong World Industries, filed bankruptcy petitions in the U.S. Bankruptcy Court for the District of Delaware, In re Armstrong World Industries, Inc. Under section 362(a) of the Bankruptcy Code, Parsons is automatically stayed with respect to all defendants. Winston-Salem, N.C.-based Reynolds American Inc.'s wholly owned subsidiaries include its operating subsidiaries: R. J. Reynolds Tobacco Co., Lane Ltd., Santa Fe Natural Tobacco Company Inc., R. J. Reynolds Global Products Inc., and Conwood Company LLC, Conwood Sales Co. LLC, Scott Tobacco LLC, and Rosswil LLC. ASBESTOS LITIGATION: Regal Beloit Subject to Asbestos Lawsuits -------------------------------------------------------------- Regal Beloit Corporation is, from time to time, a party to litigation that arises in its operations, including, asbestos matters, contract disputes, product warranty and liability claims, and environmental, employment and other litigation matters. Litigation may have an adverse effect on the Company because of potential adverse outcomes, the costs associated with defending lawsuits, the diversion of management's resources and other factors. No other matters were disclosed in the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. Company Profile: Regal Beloit Corporation 200 State St. Beloit, Wis. 53511-6254 United States Phone: (608) 364-8800 Web site: http://www.regal-beloit.com/ Description: Regal Beloit Corporation is a manufacturer of commercial, industrial, and HVAC electric motors, electric generators and controls, and mechanical motion control products. The Company is based in Beloit, Wis. ASBESTOS LITIGATION: Cooper Ind. Action v. PepsiAmericas Ongoing ---------------------------------------------------------------- An asbestos-related insurance action filed by Cooper Industries, LLC against PepsiAmericas, Inc., and other parties is ongoing in Cook County Circuit Court, Minn., according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. On May 31, 2005, Cooper filed and later served a lawsuit against the Company, Pneumo Abex, LLC, and the Trustee of the Trust, captioned Cooper Industries, LLC v. PepsiAmericas, Inc., et al., Case No. 05 CH 09214. The claims involve the Trust and an insurance policy. Cooper asserts that it was entitled to access US$34 million that previously was in the Trust and was used to purchase the insurance policy. Cooper claims that Trust funds should have been distributed for underlying Pneumo Abex asbestos claims indemnified by Cooper. Cooper complains that it was deprived of access to money in the Trust because of the Trustee's decision to use the Trust funds to purchase the insurance policy. Pneumo Abex, the corporate successor to the Company's prior subsidiary, has been dismissed from the suit. During the second quarter of 2006, the Trustee's motion to dismiss, in which the Company had joined, was granted and three counts against the Company based on the use of Trust funds were dismissed with prejudice, as were all counts against the Trustee, on the grounds that Cooper lacks standing to pursue these counts because it is not a beneficiary under the Trust. The Company then filed a separate motion to dismiss the remaining counts against it. The Company's motion was granted during the second quarter of 2006 and all remaining counts against the Company were dismissed with prejudice. Cooper subsequently filed a notice of appeal with regard to all rulings by the court dismissing the counts against the Company and the Trustee. Prior to any oral argument, the appellate court on Sept. 7, 2007, issued an opinion affirming the trial court's opinion. Cooper subsequently filed motion papers asking the Illinois Supreme Court to accept a discretionary appeal of the rulings. The Trustee then filed an opposition brief explaining why the Illinois Supreme Court should not allow another appeal, and the Company joined in that brief. On Nov. 29, 2007, the Supreme Court of Illinois denied Cooper's petition for leave to appeal the appellate court's Sept. 7, 2007 ruling. Cooper had until Feb. 27, 2008 to file a petition for certiorari seeking discretionary review by the U.S. Supreme Court. Minneapolis-based PepsiAmericas, Inc. manufactures, distributes, and markets beverage products in the United States, Central and Eastern Europe and the Caribbean, and has expanded its distribution to include snack foods and beer in certain markets. The Company accounts for about 19 percent of all PepsiCo, Inc. beverage products sold in the U.S. ASBESTOS LITIGATION: PepsiAmericas Accrues $4Mil for Liability -------------------------------------------------------------- PepsiAmericas, Inc. had accrued US$4 million related to product liability as of the end of fiscal year 2007, compared with US$5.5 million as of the end of fiscal year 2006. These accruals primarily relate to probable asbestos claim settlements and legal defense costs. The Company has certain indemnification obligations related to product liability and toxic tort claims that might emanate out of a 1988 agreement with Pneumo Abex, LLC. Other companies not owned by or associated with the Company also are responsible to Pneumo Abex for the financial burden of all asbestos product liability claims filed against Pneumo Abex after a certain date in 1998, except for certain claims indemnified by the Company. The Company also has additional amounts accrued for legal and other costs associated with obtaining insurance recoveries for previously resolved and currently open claims and their related costs. These amounts are included in the total liabilities of US$40.2 million accrued as of the end of fiscal year 2007. In addition to the known and probable asbestos claims, the Company may be subject to additional asbestos claims that are possible for which no reserve had been established as of the end of fiscal year 2007. These additional reasonably possible claims are primarily asbestos related and the aggregate exposure related to these possible claims is estimated to be in the range of US$4 million to US$17 million. Minneapolis-based PepsiAmericas, Inc. manufactures, distributes, and markets beverage products in the United States, Central and Eastern Europe and the Caribbean, and has expanded its distribution to include snack foods and beer in certain markets. The Company accounts for about 19 percent of all PepsiCo, Inc. beverage products sold in the U.S. ASBESTOS LITIGATION: OfficeMax Continues to Face Injury Actions --------------------------------------------------------------- Over the past several years and continuing in 2008, OfficeMax Incorporated has been named a defendant in a number of cases where the plaintiffs allege asbestos-related injuries from exposure to asbestos products or exposure to asbestos while working at job sites. The claims vary widely and often are not specific about the plaintiffs' contacts with the Company. None of the claimants seeks damages from the Company individually. Many of the cases filed against the Company have been voluntarily dismissed, although the Company has settled some cases. The settlements the Company has paid have been covered mostly by insurance. To date, no asbestos case against the Company has gone to trial. Naperville, Ill.-based OfficeMax Incorporated engages in office products distribution. The Company provides office supplies and paper, print and document services, technology products and solutions and furniture to large, medium and small businesses, government offices, and consumers. Company customers are served by about 36,000 associates through direct sales, catalogs, the Internet and retail stores. ASBESTOS LITIGATION: Court Rules v. Plaintiff in Kellogg Lawsuit ---------------------------------------------------------------- The U.S. District Court, S.D. Texas, Houston Division, denied Geraldine Nicholas' motion to compel arbitration and to stay, in a lawsuit filed on behalf of James Nicholas against his former employers M.W. Kellogg Company, Kellogg Brown & Root LLC, KBR, Inc., and Halliburton Co. The case is styled Geraldine Nicholas, Individually and as Administratrix of the Estate of James Nicholas, Plaintiff, v. M.W. Kellogg Company, et al., Defendants. District Judge Lee H. Rosenthal entered judgment of Civil Action No. H-07-0657 on Feb. 12, 2008. Mr. Nicholas was an M.W. Kellogg employee who developed mesothelioma. On Dec. 24, 1998, he and M.W. Kellogg signed a severance agreement. Under the agreement, Mr. Nicholas released M.W. Kellogg from liability for any claims he had against M.W. Kellogg, and M.W. Kellogg agreed to continue Mr. Nicholas' "company-provided benefits." Mr. Nicholas took a medical leave of absence from his job in 1998 and continued to receive health insurance benefits at active employee rates. He received short-term and then long-term disability insurance benefits under the parties' agreement. On Jan. 2, 2003, Mr. Nicholas' benefits were terminated and he received a COBRA notification informing him that he was not entitled to benefits. He contacted the defendants' human resources department and was instructed to exercise his COBRA rights to prevent his health coverage from lapsing while M.W. Kellogg corrected the error in termination. Mr. Nicholas medical and dental benefits were restored on Nov. 1, 2003, and the defendants reimbursed Mr. Nicholas for his out-of-pocket costs associated with the COBRA coverage he had received in the interim. In this suit, Mrs. Nicholas alleged that the defendants did not reinstate her husband's life insurance, which he was entitled to receive under his severance agreement. Mr. Nicholas died on Dec. 20, 2006. Mrs. Nicholas sued the defendants in Texas state court on Jan. 17, 2007, alleging breach of contract and seeking damages in the amount of the life insurance allegedly promised under the severance agreement. The defendants removed. After the District Court denied her motion to remand based on federal question removal jurisdiction, Mrs. Nicholas sought and obtained leave to amend to assert causes of action under ERISA. Mrs. Nicholas now sought to compel arbitration under the agreement between her husband and his employer. The defendants argued that Mrs. Nicholas has waived her right to arbitrate by substantially invoking the judicial process in this litigation. Mrs. Nicholas did not respond to these arguments. Ten months after filing suit, Mrs. Nicholas moved to stay these proceedings and compel arbitration. The defendants have responded. The District Court denied Mrs. Nicholas' motion to compel arbitration and to stay. Edward Downs Fisher, Provost Umphrey, Beaumont, Tex., represented Geraldine Nicholas. Michael James Muskat, Muskat, Martinez & Mahony, LLP, Houston, represented M.W. Kellogg Company and other Defendants. ASBESTOS LITIGATION: Old Republic Cites Net Reserves of $121.9M --------------------------------------------------------------- Old Republic International Corporation's asbestos reserves were a net of US$121.9 million (a gross of US$149.4 million) at the end of Dec. 31, 2007, compared with a net of US$117.3 million (a gross of US$151.8 million) at the end of Dec. 31, 2006. The Company's reserve estimates also include provisions for indemnity and settlement costs for various asbestosis and environmental impairment ("A&E") claims that have been filed in the normal course of business against a number of its insurance subsidiaries. Many such claims relate to policies issued prior to 1985, including many issued during a short period between 1981 and 1982 under an agency agreement canceled in 1982. Over the years, the Company's property and liability insurance subsidiaries have typically issued general liability insurance policies with face amounts ranging between US$1 million and US$2 million and rarely exceeding US$10 million. Those policies have, in turn, been subject to reinsurance cessions which have typically reduced the subsidiaries' net retentions to US$500,000 or less as to each claim. In recent times, the Executive Branch and the U.S. Congress has proposed or considered changes in the legislation and rules affecting the determination of liability for environmental and asbestosis claims. As of Dec. 31, 2007, however, there is no solid evidence to suggest that possible future changes might mitigate or reduce some or all of these claim exposures. At Dec. 31, 2007, the Company's aggregate indemnity and loss adjustment expense reserves specifically identified with A&E exposures amounted to about US$190.5 million gross, and US$158.1 million net of reinsurance. Based on average annual claims payments during the five most recent calendar years, such reserves represented 7.7 years (gross) and 10.7 years (net of reinsurance) of average annual claims payments. For the five years ended Dec. 31, 2007, incurred A&E claim and related loss settlement costs have averaged 2.8 percent of average annual General Insurance Group claims and related settlement costs. Chicago-based Old Republic International Corporation is a holding company engaged in the single business of insurance underwriting. It conducts its operations through a number of regulated insurance company subsidiaries organized into three major segments, namely, its General (property and liability insurance), Mortgage Guaranty, and Title Insurance Groups. ASBESTOS LITIGATION: Owens Corning Has $36M for Remaining Claims ---------------------------------------------------------------- Owens Corning has reserved about US$36 million as of Dec. 31, 2007, to pay remaining asbestos claims in the Bankruptcy of which about US$34 million relates to non-tax claims (the "Non- Tax Bankruptcy Reserve"). On Oct. 5, 2000, Owens Corning Sales, LLC (formerly known as Owens Corning) and the 17 U.S. subsidiaries filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. Until Oct. 31, 2006, the date on which the Debtors emerged from bankruptcy, the Debtors operated their businesses as debtors-in- possession in accordance with the Bankruptcy Code. The Chapter 11 cases of the Debtors (collectively, the "Chapter 11 Cases") were jointly administered under Case No. 00-3837 (JKF). The Debtors filed for relief under Chapter 11 of the Bankruptcy Code to address the growing demands on cash flow resulting from the multi-billion dollars of asbestos personal injury claims that had been asserted against OCD and Fibreboard Corporation. Following a Confirmation Hearing on Sept. 18, 2006, the USBC entered an Order on Sept. 26, 2006, confirming the Debtors' Sixth Amended Joint Plan of Reorganization for Owens Corning and Its Affiliated Debtors and Debtors-In-Possession (as Modified), and the Findings of Fact and Conclusions of Law Regarding Confirmation of the Sixth Amended Joint Plan of Reorganization for Owens Corning and Its Affiliated Debtors and Debtors-In- Possession. On Sept. 28, 2006, the U.S. District Court for the District of Delaware entered an order affirming the Confirmation Order and the Findings of Fact and Conclusions of Law. Under the Confirmation Order, the Plan became effective in accordance with its terms on Oct. 31, 2006 (the "Effective Date"). Under the terms of the Plan and related Confirmation Order, asbestos personal injury claims against each of OCD and Fibreboard will be administered and distributions on account of such claims will be made, exclusively from the 524(g) Trust that has been established and funded under the Plan. In addition, all asbestos property damage claims against OCD or Fibreboard either: (i) have been resolved, (ii) will be resolved under the Plan, along with certain other unsecured claims for an aggregate amount within the Company's Non-Tax Bankruptcy Reserve, or (iii) are barred under the Plan and Confirmation Order. Accordingly, other than the limited number and value of property damage claims being resolved under clause (ii) above, the Company has no further asbestos liabilities. Under the terms of the Plan, the Company is obligated to make certain additional payments to certain creditors, including certain payments to holders of administrative expense priority claims and professional advisors in the Chapter 11 Cases. Under the Plan, the Company has established a Disputed Distribution Reserve, funded in the amount of about US$33 million as of Dec. 31, 2007, which is reflected as restricted cash in the Consolidated Balance Sheet, for the potential payment of certain non-tax claims against the Debtors that were disputed as of the Effective Date. Toledo, Ohio-based Owens Corning produces residential and commercial building materials and glass fiber reinforcements and other similar materials for composite systems. The Company operates within two general product categories: building materials and composites. ASBESTOS LITIGATION: Minerals Technologies Still Faces 26 Suits --------------------------------------------------------------- Minerals Technologies Inc. continues to face 26 pending asbestos-related cases, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2007. To date, one asbestos case has been dismissed. In the 2007-3rd quarter, the Company faced 26 asbestos-related cases filed against it. (Class Action Reporter, Nov. 16, 2007) Certain of the Company's subsidiaries are among numerous defendants in a number of cases seeking damages for exposure to asbestos containing materials. The Company has not settled any asbestos lawsuit to date. It is unable to state an amount or range of amounts claimed in any of the lawsuits because state court pleading practices do not require identifying the amount of the claimed damage. The aggregate cost to the Company for the legal defense of asbestos and silica cases in 2006 was US$100,000. Costs for the legal defense of these cases in 2007 were US$78,500. New York-based Minerals Technologies Inc. is a resource- and technology-based company that develops, produces and markets specialty mineral, mineral-based and synthetic mineral products and supporting systems and services. The Company has two reportable segments: Specialty Minerals and Refractories. ASBESTOS LITIGATION: Midwest Generation Has 207 Cases at Dec. 31 ---------------------------------------------------------------- Midwest Generation, LLC, at Dec. 31, 2007, recorded about 207 asbestos-related cases for which it was potentially liable and that had not been settled and dismissed, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company had recorded a US$54.5 million liability related to this matter at Dec. 31, 2007, compared with US$64.6 million at Dec. 31, 2006. At Sept. 30, 2007, the Company recorded about 208 asbestos- related cases for which it was potentially liable and that had not been settled and dismissed. (Class Action Reporter, Nov. 23, 2007.) The Company entered into a supplemental agreement with Commonwealth Edison Company and Exelon Generation Company, LLC on Feb. 20, 2003, to resolve a dispute regarding interpretation of its reimbursement obligation for asbestos claims under the environmental indemnities set forth in an Asset Sale Agreement. Under this supplemental agreement, the Company agreed to reimburse Commonwealth Edison and Exelon Generation for 50 percent of specific asbestos claims pending as of February 2003 and related expenses less recovery of insurance costs, and agreed to a sharing arrangement for liabilities and expenses associated with future asbestos-related claims as specified in the agreement. Commonwealth Edison and the Company apportion responsibility for future asbestos-related claims based upon the number of exposure sites that are Commonwealth Edison locations or Company locations. The Company engaged an independent actuary in 2004 to complete an estimate of future losses. Based on the actuary's analysis, the Company recorded an undiscounted liability for its indemnity for future asbestos claims through 2045. During the fourth quarter of 2007, the actuary report was updated and the liability reduced by US$9 million. Chicago-based Midwest Generation, LLC sells wholesale electricity to markets in the Midwest. The Company has a generating capacity of more than 5,610 MW from its six coal- fired power plants in Illinois. The Company is a subsidiary of Edison International unit Edison Mission Midwest Holdings Co. ASBESTOS LITIGATION: W.W. Grainger Inc. Faces 2,800 Plaintiffs -------------------------------------------------------------- W.W. Grainger, Inc., as of Jan. 14, 2008, is named in cases filed on behalf of about 2,800 plaintiffs in which there is an allegation of exposure to asbestos and silica, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2009. As of Jan. 17, 2007, the Company faced cases filed on behalf of about 3,100 plaintiffs, in which there are allegations of exposure to asbestos and silica. (Class Action Reporter, March 9, 2007.) The Company has been named as a defendant in litigation in various states involving asbestos and silica. These lawsuits typically assert claims of personal injury arising from alleged exposure to asbestos and silica as a consequence of products purportedly distributed by the Company. The Company has denied, or intends to deny, the allegations in those lawsuits. In 2007, lawsuits relating to asbestos and silica and involving about 250 plaintiffs were dismissed with respect to the Company, typically based on the lack of product identification. If a specific product distributed by Grainger is identified in any of these lawsuits, Grainger would attempt to exercise indemnification remedies against the product manufacturer. Lake Forest, Ill.-based W.W. Grainger, Inc., through its Branch- based Distribution, Acklands-Grainger, and Lab Safety units, distributes maintenance, repair, and service equipment, components, and supplies. The Company provides more than 180,000 products like compressors, motors, signs, lighting and welding equipment, and hand and power tools. ASBESTOS LITIGATION: Calif. Appeal Court Favors Black & Veatch -------------------------------------------------------------- The Court of Appeal, 1st District, Division 4, California, upheld the ruling of the San Francisco County Superior Court, which granted summary judgment to Black & Veatch Corporation (Black), in an asbestos-related lawsuit filed by spouses Jennifer Drinkwater and Robert Drinkwater. The case is styled Jennifer A. Drinkwater et al., Plaintiffs and Appellants, v. Black & Veatch Corporation, Defendant and Respondent. Judges Ruvolo, Reardon, and Sepulveda entered judgment of Case No. A118061 on Feb. 14, 2008. On Sept. 7, 2000, the Drinkwaters' trial counsel filed a "Master Complaint-Asbestos" in San Francisco Superior Court, under that court's "General Order No. 55." On Aug. 23, 2006, the Drinkwaters filed a complaint for personal injury and loss of consortium-asbestos. Under General Order No. 55, the complaint referenced in chart form, those claims pleaded in the "Master Complaint-Asbestos" against the individual defendants sued in the current action. A motion for calendar preference was made in October 2006 by the Drinkwaters based upon a showing that Mrs. Drinkwater was not expected to live more than six months. Several of the defendants, including Black, filed a "Conditional Non- Opposition" to the motion. The motion was granted by the trial court on Oct. 31, 2006. The order granting calendar preference set strict procedural time limits for further proceedings. The case was "singly assigned" to Judge Katherine Feinstein, and the parties were ordered to appear before Judge Feinstein on Nov. 3, 2006. Also in October 2006, the Drinkwaters filed their "Second Amendment to Complaint," which added another defendant. Black made a request for leave to file a first amended answer, which was not opposed by the Drinkwaters, and the motion was granted by order dated Dec. 6, 2006. By then, Feb. 20, 2007, had been set as the trial date. On or about Jan. 23, 2007, Black filed a motion for summary judgment, calendared to be heard on Feb. 9, 2007. The motion was extensively briefed by both sides, and a hearing was held on Feb. 9, 2007. That same date the trial court entered a written order granting Black's motion for summary judgment, concluding that the Drinkwaters had sued Black on a theory of premises/contractor liability only, and there was no triable issue of fact which could establish that respondent owned, occupied or controlled premises containing asbestos, which was a factual predicate to the claim against Black. On Feb. 15, 2007, the Drinkwaters applied to the court for an order shortening time to allow them to bring a motion before trial commenced to amend their complaint "to conform to proof." Alternatively, they intended to move for a new trial or for reconsideration of Black's motion for summary judgment. On Feb. 16, 2007, the trial court issued a written order entering judgment in favor of Black. A hearing on the combined, alternative motions was held on March 16, 2007 and a written order denying the motions was filed on March 29, 2007. The Drinkwaters appealed after the trial court granted Black's motion for summary judgment and denied the Drinkwaters' request for leave to amend the complaint against Black. The motion for summary judgment was based principally on the ground that there was no triable issue of fact as to whether Black owned, occupied, or controlled any property containing asbestos, a factual element essential to establishing the premises liability cause of action asserted against Black. The Drinkwaters contended on appeal that the complaint also stated a claim for general negligence against Black, but if a viable negligence claim had not been stated adequately, the trial court abused its discretion in denying the Drinkwaters' motion for leave to amend. The Appeals Court disagreed with the Drinkwaters, and affirmed the judgment. Bryce Clay Anderson, Law Office of Bryce C. Anderson, Antioch, Calif., Gloria E. Chun, Paul Hanley & Harley, Berkeley, Calif., represented Jennifer A. Drinkwater and Robert Drinkwater. Daniel Brent Hoye, McKenna Long & Aldridge, San Francisco, Kurt Legarde Rasmussen, Kansas City, Mo., Shawn Michael Ridley, Redwood City, Calif., represented Black & Veatch Corporation. ASBESTOS LITIGATION: Injury Lawsuits Still Pending v. Ford Motor ---------------------------------------------------------------- Ford Motor Company continues to be a defendant in actions for injuries claimed to have resulted from alleged contact with Ford parts and other products containing asbestos, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. Asbestos was used in brakes, clutches, and other automotive components from the early 1900s. Plaintiffs in these personal injury cases allege various health problems as a result of asbestos exposure, either from component parts found in older vehicles, insulation or other asbestos products in Company facilities, or asbestos aboard its former maritime fleet. Most of the asbestos litigation the Company faces involves mechanics or other individuals who have worked on the brakes of Company vehicles over the years. Most of the asbestos cases asserted against the Company do not specify a dollar amount for damages, and in many of the other cases the dollar amount specified is the jurisdictional minimum. Most of these cases involve multiple defendants, with the number in some cases exceeding 100. Many of these cases also involve multiple plaintiffs, and the Company is often unable to tell from the pleadings which of the plaintiffs are making claims against the Company (as opposed to other defendants). With some variation from year to year, the Company's annual payout and related defense costs in asbestos cases has generally been decreasing since 2003. These costs may, however, become substantial in the future. Dearborn, Mich.-based Ford Motor Company was incorporated in Delaware in 1919. The Company acquired the business of a Michigan company, also known as Ford Motor Company, that had been incorporated in 1903 to produce and sell automobiles designed and engineered by Henry Ford. The Company produces cars and trucks combined. The Company and its subsidiaries also engage in other businesses, including financing vehicles. ASBESTOS LITIGATION: Injury Suits Pending v. Advance Auto, Units ---------------------------------------------------------------- Advance Auto Parts, Inc., and some of its subsidiaries have been named as defendants in asbestos-related lawsuits, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company's Western Auto subsidiary, together with other defendants including automobile manufacturers, automotive parts manufacturers and other retailers, has been named as a defendant in lawsuits alleging injury as a result of exposure to asbestos- containing products. The plaintiffs have alleged that these products were manufactured, distributed and sold by the various defendants. To date, these products have included brake and clutch parts and roofing materials. Many of the cases pending against the Company or its subsidiaries are in the early stages of litigation. The damages claimed against the defendants in some of these proceedings are substantial. Additionally, some of the automotive parts manufacturers named as defendants in these lawsuits have declared bankruptcy, which will limit plaintiffs' ability to recover monetary damages from those defendants. Roanoke, Va.-based Advance Auto Parts, Inc. operates within the United States automotive aftermarket industry, which includes replacement parts (excluding tires), accessories, maintenance items, batteries and automotive chemicals for cars and light trucks (pickup trucks, vans, minivans and sport utility vehicles). ASBESTOS LITIGATION: 426 Lawsuits Pending v. AK Steel at Dec. 31 ---------------------------------------------------------------- AK Steel Holding Corporation states that, as of Dec. 31, 2007, about 426 asbestos-related lawsuits were pending against its subsidiary AK Steel Corporation, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. As of Dec. 31, 2006, the Company had 421 asbestos-related lawsuits pending against it. (Class Action Reporter, March 9, 2007) In 2007, AK Steel noted 71 new claims filed and 138 claims disposed of. The total amount paid in settlements was US$400,000. In 2006, AK Steel noted 60 new claims filed and 65 claims disposed of. The total amount paid in settlements was US$400,000. Since 1990, AK Steel (or its predecessor, Armco Inc.) has been named as a defendant in numerous lawsuits alleging personal injury as a result of exposure to asbestos. Most of these lawsuits have been filed on behalf of people who claim to have been exposed to asbestos while visiting the premises of a current or former AK Steel facility. About 40 percent of these premises suits arise out of claims of exposure at a facility in Houston that has been closed since 1984. Only 135 of the 426 cases pending at Dec. 31, 2007, in which AK Steel is a defendant include specific dollar claims for damages in the filed complaints. Those 135 cases involve a total of 2,600 plaintiffs and 17,317 defendants. In each, the complaint typically includes a monetary claim for compensatory damages and a separate monetary claim in an equal amount for punitive damages, and does not attempt to allocate the total monetary claim among the various defendants. For example, 120 of the 135 cases involve claims of US$200,000 or less, seven involve claims of between US$200,000 and US$5 million, five involve claims of between US$5 million and US$15 million, and three involve claims of US$20 million. It has been AK Steel's experience to date that a small percentage of asbestos plaintiffs ultimately identify AK Steel as a target defendant from whom they actually seek damages and most of these claims ultimately are either dismissed or settled for a small fraction of the damages initially claimed. Since the onset of asbestos claims against AK Steel in 1990, five asbestos claims against it have proceeded to trial in four separate cases. All five concluded with a verdict in favor of AK Steel. West Chester, Ohio-based AK Steel Holding Corporation is a fully-integrated producer of flat-rolled carbon, stainless and electrical steels and tubular products through its wholly owned subsidiary, AK Steel Corporation. ASBESTOS LITIGATION: Alleghany Records $22.9M Reserve at Dec. 31 ---------------------------------------------------------------- Alleghany Corporation's asbestos and environmental reserve for unpaid losses and loss adjustment expenses includes US$22.9 million of gross reserves (US$22.7 million of net reserves) at Dec. 31, 2007. These reserves were for various liability coverages related to asbestos and environmental impairment claims that arose from reinsurance assumed by Capitol Indemnity Corporation, a subsidiary of Capitol Transamerica Corporation (CATA), between 1969 and 1976. Capitol Indemnity exited this business in 1976. Promptly after the Company acquired CATA in January 2002, CATA's management commenced a program to settle, or position for commutation, Capitol Indemnity's assumed reinsurance treaties and make appropriate payments on a timely basis when deemed necessary. For the year ended Dec. 31, 2007, the aggregate gross loss and LAE payments for A&E impairment claims of CATA were US$1 million, compared with US$1.9 million in Dec. 31 2006. As of Dec. 31, 2007, reserves of CATA totaled about US$16.7 million for asbestos liabilities. At Dec. 31, 2007, the reserves for asbestos liabilities were about 15.8 times the average paid claims for the prior three-year period, compared with 14.5 times at Dec. 31, 2006. New York-based Alleghany Corporation has interests ranging from property/casualty insurance to real estate. The Company's operating subsidiaries include Capitol Transamerica, which provides property/casualty, fidelity, and surety insurance; and Darwin Professional Underwriters (55-percent owned), which writes specialty property/casualty insurance. ASBESTOS LITIGATION: Allegheny Faces 826 W.Va. Claims at Dec. 31 ---------------------------------------------------------------- Allegheny Energy, Inc., as of Dec. 31, 2007, had a total of 826 claims in West Virginia alleging exposure to asbestos, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. As of Dec. 31, 2007, the Company faced two claims in Pennsylvania and one in Illinois. As of Sept. 30, 2007, the Company recorded a total of 826 asbestos exposure claims pending in West Virginia. (Class Action Reporter, Nov. 30, 2007) The Distribution Companies (Monongahela Power Company, The Potomac Edison Company, and West Penn Power Company) have been named as defendants, along with multiple other defendants, in pending asbestos cases alleging bodily injury involving multiple plaintiffs and multiple sites. These suits have been brought mostly by seasonal contractors' employees and do not involve allegations of the manufacture, sale or distribution of asbestos-containing products by the Company. These asbestos suits arise out of historical operations and are related to the installation and removal of asbestos-containing materials at the Company' generation facilities. The Company's historical operations were insured by various foreign and domestic insurers, including Lloyd's of London. Asbestos-related litigation expenses have to date been reimbursed in full by recoveries from these historical insurers. However, certain insurers have contested their obligations to pay for the future defense and settlement costs relating to the asbestos suits. The Company is involved in three asbestos and environmental insurance-related actions: -- Certain Underwriters at Lloyd's, London et al. v. Allegheny Energy, Inc. et al., Case No. 21-C-03-16733 (Washington County, Md.), -- Monongahela Power Company et al. v. Certain Underwriters at Lloyd's London and London Market Companies, et al., Civil Action No. 03-C-281 (Monongalia County, W.Va.) and -- Allegheny Energy, Inc. et al. v. Liberty Mutual Insurance Company, Civil Action No (Suffolk Superior Court, Ma.). The parties in these actions seek a declaration of coverage under the policies for asbestos-related and environmental claims. Greensburg, Pa.-based Allegheny Energy, Inc. is an integrated energy business that owns and operates electric generation facilities and delivers electric services to customers in Pennsylvania, West Virginia, Maryland and Virginia. The Company has two business segments: Delivery and Services segment and Generation and Marketing. ASBESTOS LITIGATION: Allstate Reserves $1.3B for Claims at Dec. --------------------------------------------------------------- The Allstate Corporation's reserves for asbestos claims, at Dec. 31, 2007, totaled US$1.30 billion, net of reinsurance recoverables of US$752 million, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. At Dec. 31, 2006, the Company's reserves for asbestos claims was US$1.38 billion, net of reinsurance recoverables of US$823 million. About 63 percent of the total net asbestos and environmental reserves at Dec. 31, 2007 (67 percent at Dec. 31, 2006) were for incurred but not reported estimated losses. Reinsurance recoverables include US$240 million at Dec. 31, 2007 (US$$271 million at Dec. 31, 2006) from Lloyd's of London. Lloyd's of London, through the creation of Equitas Limited, implemented a restructuring plan in 1996 to solidify its capital base and to segregate claims for years prior to 1993. The recoverable from Equitas Limited syndicates is spread among thousands of Lloyd's of London investors who have unlimited liability. The reinsurance recoverables valuation allowance was reduced by US$46 million in 2007 related to Equitas Limited's improved financial position as a result of its obtaining reinsurance coverage with National Indemnity Company. Underwriting loss of US$54 million in 2007 primarily related to a US$63 million reestimate of environmental reserves and a US$6 million reestimate of asbestos reserves as a result of the annual third quarter 2007 ground up reserve review, partially offset by a US$46 million reduction in the reinsurance recoverable valuation allowance related to Equitas Limited's improved financial position as a result of its reinsurance coverage with National Indemnity Company. The cost of administering claims settlements totaled US$14 million for the year ended Dec. 31, 2007, compared with US$19 million for the year ended Dec. 31, 2006. For the year ended Dec. 31, 2007, the Company noted 876 new claims filed, 795 total claims closed, 9,256 pending claims, and 364 claims closed without payment. For the year ended Dec. 31, 2006, the Company noted 1,220 new claims filed, 851 claims total claims closed, 9,175 pending claims, and 596 claims closed without payment. Based in Northbrook, Ill., The Allstate Corporation's business is conducted principally through Allstate Insurance Company. The Company is engaged in the personal property and casualty insurance business and the life insurance, retirement and investment products business. The Company has four business segments: Allstate Protection, Allstate Financial, Discontinued Lines and Coverages, and Corporate and Other. ASBESTOS LITIGATION: AMETEK Continues to Face Exposure Lawsuits --------------------------------------------------------------- AMETEK, Inc., including its subsidiaries, is a defendant in asbestos-related lawsuits, in which many of these suits either relate to businesses which were acquired by the Company and do not involve products which were manufactured or sold by the Company, or relate to previously owned businesses of the Company which are under new ownership. In connection with many of these lawsuits, the sellers or new owners of those businesses have agreed to indemnify the Company against these claims (Indemnified Claims). The Indemnified Claims have been tendered to, and are being defended by, those sellers and new owners. These sellers and new owners have met their obligations in all respects, and the Company does not have any reason to believe such parties would fail to fulfill their obligations in the future. To date, no judgments have been rendered against the Company as a result of any asbestos-related lawsuit. Paoli, Pa.-based AMETEK, Inc. is a manufacturer of electronic instruments and electromechanical devices with operations in North America, Europe, Asia, and South America. ASBESTOS LITIGATION: 538 Claims Pending v. Constellation & BGE -------------------------------------------------------------- Constellation Energy Group, Inc. and its subsidiary Baltimore Gas and Electric Company (BGE) face about 538 asbestos-related claims, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. These 538 individuals who were never employees of BGE or the Company have pending claims each seeking several million dollars in compensatory and punitive damages. Since 1993, BGE and certain Company subsidiaries have been involved in several actions concerning asbestos. The actions are based upon the theory of "premises liability," alleging that BGE and the Company knew of and exposed individuals to an asbestos hazard. In addition to BGE and the Company, numerous other parties are defendants in these cases. Cross-claims and third-party claims brought by other defendants may also be filed against BGE and the Company in these actions. To date, most asbestos claims against the Company have been dismissed or resolved without any payment and a minority have been resolved for amounts that were not material to the Company's financial results. The remaining claims are pending in state courts in Maryland and Pennsylvania. Asbestos-related claims against the Company and BGE remained at about 535. (Class Action Reporter, Nov. 30, 2007) Baltimore-based Constellation Energy Group, Inc. is an energy company that includes a merchant energy business and Baltimore Gas and Electric Company, a regulated electric and gas public utility in central Maryland. ASBESTOS LITIGATION: Injury Lawsuits Still Pending v. Flowserve --------------------------------------------------------------- Flowserve Corporation continues to defend against a number of pending lawsuits (which include, in many cases, multiple claimants) that seek to recover damages for personal injury allegedly caused by exposure to asbestos-containing products manufactured and/or distributed by the Company in the past. While the aggregate number of asbestos-related claims against the Company has declined in recent years, there can be no assurance that this trend will continue. Asbestos associated with any such products was encapsulated and used only as components of process equipment, and the Company said it does not believe that any significant emission of asbestos fibers occurred during the use of this equipment. The Company said it believes that a high percentage of the claims are covered by applicable insurance or indemnities from other companies, according to its annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. Irving, Tex.-based Flowserve Corporation is a manufacturer and aftermarket service provider of comprehensive flow control systems. The Company develops and manufactures precision- engineered flow control equipment, such as pumps, valves and seals, for critical service applications that require high reliability. ASBESTOS LITIGATION: Fitzgerald Briefed on Johns-Manville Issues ---------------------------------------------------------------- Counsel to The Burlington Northern Santa Fee Railway, Anne Marie Aaronson, at Pepper Hamilton, LLP, in Philadelphia, notified Judge Judith Fitzgerald that a recent opinion of the U.S. Court of Appeals for the 2nd Circuit in In re Johns-Manville Corporation touched on certain issues relevant to W.R. Grace & Co.'s motion for injunctive relief, including: (1) Whether the bankruptcy court has subject matter jurisdiction to enjoin claims against a non-debtor that do not claim against the res of the bankruptcy estate; (2) Whether the Bankruptcy Court has subject matter jurisdiction to enjoin claims against a non-debtor, which claims seek recovery in excess of and unrelated to the debtor's policy proceeds; and (3) Whether the bankruptcy court has subject matter jurisdiction to enjoin claim against a non-debtor party. The Appellate Court, in a 28-page memorandum published on Feb. 15, 2008, ruled that a confirmed Chapter 11 plan of reorganization dealing with asbestos claims may not give insurance companies releases from all claims. Johns Manville Corp., the largest manufacturer of asbestos- containing products in the United States, sought protection under Chapter 11 in 1982 in the U.S. Bankruptcy Court for the Southern District of New York. In 1986, Judge Burton Lifland, the bankruptcy judge overseeing Manville's reorganization, confirmed Manville's plan of reorganization, which provided for the creation of a trust that took over all of the company's asbestos liabilities. Under that reorganization plan, Manville's insurers were given release from all liabilities under insurance policies they issued to Manville in return for a contribution of roughly US$850 million. However, some asbestos plaintiffs continued individual and class lawsuits against the Manville insurers asserting that they have "direct action claims" against the insurance companies not related to the Manville insurance policies. In 2004, Judge Lifland approved a settlement where he ruled that the remaining insurance lawsuits were and always had been blocked by the confirmed Manville reorganization plan. The Appellate Court ruled that there is no bankruptcy jurisdiction that bars independent tort actions where plaintiffs neither seek to recover insurance proceeds nor rely on the insurance policies for recovery, in reverse to Judge Lifland's 2004 opinion. The Appellate Court also held that there was no power in bankruptcy law to stop a lawsuit against a third party simply because the third party made a financial contribution to the Chapter 11 plan. A full-text copy of the Feb. 15 Manville Opinion is available for free at: http://bankrupt.com/misc/grace_feb15ManvilleOpinion.pdf (W.R. Grace Bankruptcy News, Issue No. 152; Bankruptcy Creditors' Service, Inc. 215-945-7000 FAX 215-945-7001) ASBESTOS LITIGATION: Grace Claimants Asks Court to Extend Period ---------------------------------------------------------------- Speights & Runyan asks the U.S. Bankruptcy Court to extend the time for three asbestos-related property damage claimants to file their memorandum in response to W.R. Grace & Co.'s objection to their claims: Claimant Claim No. -------- --------- Bayshore Community Hospital 6901 Children's Hospital of Pittsburgh 10962 Jameson Memorial Hospital 14410 Daniel A. Speights, at Speights & Runyan, in Hampton, S.C. relates that in November 2007, the Court instructed the Debtors to attempt to settle the issues relating to the three Claims before the Feb. 25, 2008, omnibus hearing. The Debtors, however, have not conferred with the Claimants or their counsel regarding any settlement, according to Mr. Speights. (W.R. Grace Bankruptcy News, Issue No. 152; Bankruptcy Creditors' Service, Inc. 215-945-7000 FAX 215-945-7001) ASBESTOS LITIGATION: 40 Speights Claimants Appeal on Expungement ---------------------------------------------------------------- W.R Grace & Co. states that more than 40 asbestos-related property damage claimants represented by the law firm Speights & Runyan take an appeal to the U.S. States Court of Appeals for the 3rd Circuit from District Judge Ronald L. Buckwalter's order affirming the U.S. Bankruptcy Court's order expunging some PD Claims. The Appellants are: 1. 1199 SEIU, 2. 99 Founders Plaza, 3. Abbeville General Hospital, 4. Baptist Health Medical Center - Little Rock, 5. Bethesda Rehabilitation Hospital, 6. Carson Pirie Scott Store #537, 7. Cayuga County Office Building, 8. Dodge County Hospital, 9. First Health Montgomery Memorial Hospital, 10. First Tennessee Bank - Court Thomas Computer Center, 11. First Tennessee Bank, 12. Friendly Home Nursing Care & Rehabilitation, 13. Fulton County Health Center, 14. Gundersen Lutheran Medical Center, 15. Harry C. Levy Gardens, 16. Hotel Captain Cook - Tower #2, 17. IBM Metro Employees Federal Credit Union, 18. Jordan Hospital, Inc., 19. Keller Building, 20. Manor Oak Two, 21. McKenzie Willamette Medical Center, 22. Mission Towers, 23. Nebraska Skilled Nursing and Rehabilitation, 24. New Hanover Regional Medical Center, 25. Ohio Savings Plaza, 26. Oneida County Office Building, 27. Palos Community Hospital, 28. Panda Prints, 29. Pierre LaClede Center No. 1 & 2, 30. Santa Teresa Medical Office Building, 31. Schuyler Hospital, 32. Scottish Rite Cathedral, 33. St. Anthony's Regional Hospital & Nursing Home, 34. St. Joseph's Hill Infirmary Nursing Home, 35. St. Luke's Hospital, 36. St. Mary's Medical Center, 37. The Homeplace of Mondovi Hospital, 38. Titusville Hospital, 39. University of New England - Westbrook Campus, 40. Virtua Health - West Jersey Hospital Voorhees, 41. Virtua West Jersey Hospital Marlton, 42. Washington Township Health Care District, and 43. Y.W.C.A. of Greater Des Moines. (W.R. Grace Bankruptcy News, Issue No. 152; Bankruptcy Creditors' Service, Inc. 215-945-7000 FAX 215-945-7001) ASBESTOS LITIGATION: Deadline on Grace's Appeal Set for April 14 ---------------------------------------------------------------- U.S. Supreme Court Justice Anthony Kennedy gives W.R. Grace & Co., until April 14, 2008, to file an appeal from the U.S. Court of Appeals for the 9th Circuit's decision restoring the conspiracy charges filed by the U.S. Government against Grace and certain of its officers, the Associated Press reported. To recall, the Government, in 2005, filed a criminal case in the U.S. District Court for the District of Montana against Grace and seven of its former officers for violations of environmental law and for alleged conspiracy in hiding the real health risks associated with the company's vermiculite mine in Libby, Mont. In 2005, Montana District Court Judge Donald Molloy dropped the conspiracy charges ruling that they are time-barred. The Appellate Court, however, reinstated the conspiracy charges in September 2007, pointing out that Grace did not dispute that the criminal case was timely filed. According to The Missoulian, a trial on Grace's criminal case could begin in May 2008, although no date can be set until the appeals are settled. Grace has said in its Form 10-Q filed with the U.S. Securities and Exchange Commission in September 2007 that it may pay as much as US$280 million in fines if convicted in the criminal case. Grace added that its former officers may face up to 15 years of imprisonment, if convicted. (W.R. Grace Bankruptcy News, Issue No. 152; Bankruptcy Creditors' Service, Inc. 215-945-7000 FAX 215-945-7001) ASBESTOS LITIGATION: Minn. Court Favors Plaintiffs in Northshore ---------------------------------------------------------------- The U.S. District Court, D. Minnesota, granted Save Lake Superior Association and Sierra Club's Motion to Lift the Stay, in an asbestos-related lawsuit filed against Northshore Mining Company. The stay entered Sept. 24, 2007 was lifted. The case is styled Save Lake Superior Association and Sierra Club, Plaintiffs, v. Northshore Mining Company, Defendant. District Judge Paul A. Magnuson entered judgment of Civil No. 07-3557 (PAM/JSM) on Feb. 12, 2008. This matter was before the District Court on Save Lake Superior and Sierra's Motion to Lift the Stay. In September 2007, the Court granted Northshore's Motion to Stay the matter, pending resolution of Northshore's Motions in a related case. The Court has disposed of the pending Motions in the related case, and Save Lake Superior and Sierra now argued that the Court should lift the stay in this matter to allow them to pursue their claims. Northshore opposed the Motion. This lawsuit sought to enforce the "control city" standard in Northshore's air quality permits. According to Save Lake Superior and Sierra, testing has revealed that the ambient air surrounding Northshore's Silver Bay taconite plant contains more asbestos and asbestos-like fibers than the ambient air in the "control city" of St. Paul, Minn. Save Lake Superior and Sierra requested damages (payable to the U.S. treasury), as well as attorney's fees and costs, for the alleged violations of Northshore's permit under the citizen-suit enforcement provisions of the Environmental Protection Act. The Court granted a stay because the Motions in the related case sought to clarify or strike down the "control city" standard contained in a 1975 injunction. Northshore contended that the stay should remain in place because the Minnesota Court of Appeals is poised to consider Northshore's attempt to amend its permits to remove the "control city" standard. Save Lake Superior and Sierra asserted that, unless and until the state courts or the Minnesota Pollution Control Agency ("MPCA") remove the "control city" standard from Northshore's permit, Northshore is obligated to comply with that standard and Save Lake Superior and Sierra may seek to enforce the standard. Accordingly, the District Court ordered that Save Lake Superior and Sierra's Motion to Lift the Stay (Docket No. 29) was granted and the stay entered Sept. 24, 2007 (Docket No. 27), was lifted. Amy L. De Kok, Michael D. Madigan, Madigan, Dahl & Harlan, PA, Minneapolis, Reed Zars, Attorney at Law, Laramie, Wyo., represented Save Lake Superior Association and Sierra Club. Geoffrey K. Barnes, Squire, Sanders & Dempsey L.L.P., Cleveland, Ohio, James A. Mennell, William P. Hefner, Environmental Law Group, Ltd., Minneapolis, Vincent Atriano, Square, Sanders & Dempsey LLP, Columbus, Ohio, represented Northshore Mining Company. ASBESTOS LITIGATION: Oregon Court Affirms Newman's Remand Motion ---------------------------------------------------------------- The U.S. District Court, D. Oregon, granted Claude E. Newman's motion to remand, in an asbestos-related lawsuit filed against various defendants including Airgas-Nor Pac, Inc. and Ford Motor Company. The case is styled Claude E. Newman, Plaintiff, v. Crown Cork & Seal Company, Inc., a Pennsylvania corporation, individually and as successor-in-interest to Mundet Cork Corporation; et al., Defendants. Judge Jones entered judgment of Civil No. 07-1533-JO on Feb. 11, 2008. Mr. Newman filed this action in Multnomah County Circuit Court in October 2006, alleging state law claims to the effect that the products and activities of several named defendants exposed him to asbestos and caused him severe injuries. During the course of litigation in state court, Mr. Newman dismissed the only Oregon defendant, Oregon Airgas, Inc., as incorrectly named. On Oct. 12, 2007, before Mr. Newman was able to file an amended complaint naming the proper defendant, Airgas-Nor Pac and Ford removed the action to this court based on diversity jurisdiction. On Oct. 29, 2007, Mr. Newman filed two motions in this court: a motion for leave to amend the complaint to add Airgas-Nor Pac, and a motion to remand the action to state court. On Nov. 16, 2007, the Judicial Panel on Multi-District Litigation issued a conditional transfer order transferring this action as a tag-along to the asbestos litigation now pending in the U.S. District Court for the Eastern District of Pennsylvania, MDL No. 875. On Dec. 18, 2007, Mr. Newman filed a motion with the MDL Panel to vacate the conditional transfer order. In the meantime, Mr. Newman asked this court to proceed with his motions to amend and to remand, and on Jan. 17, 2008, the Court heard oral argument on the motions. As a result of that hearing, Judge Jones granted Mr. Newman's motion for leave to amend and took Mr. Newman's motion to remand under advisement. Mr. Newman's motion to remand was granted, and this action was remanded to Multnomah County Circuit Court for all further proceedings. Patrick D. Angel, Brayton Purcell, Portland, Ore., represented Claude E. Newman. Daniel K. Reising, Mark J. Fucile, Fucile & Reising, Portland, Ore., Michael A. Jaeger, Wilson Smith Cochran Dickerson, Seattle, represented Crown Cork & Seal Company, Inc. and other Defendants. ASBESTOS LITIGATION: Ill. AG Sues Bldg. Owner for Cleanup Breach ---------------------------------------------------------------- Illinois Attorney General Lisa Madigan has filed a lawsuit alleging that a Bloomington, Ill., building owner and his tenant broke the law when they did not use a licensed asbestos contractor to properly remove asbestos-containing materials during a major renovation project in 2006, according to an Illinois Attorney General press release dated March 4, 2008. The complaint, filed in McLean County Circuit Court, alleges that the defendants did not follow proper removal procedures required by law to avoid contamination. The complaint names Merle Huff, owner of the Front 'N Center Building at 102 N. Center St., and his tenant Ben Slotky. The complaint alleges that Mr. Huff allowed Mr. Slotky – during a March 2006 renovation project – to remove asbestos-containing flooring materials and place them in unsealed plastic garbage bags. Mr. Slotky is not a licensed asbestos contractor. Ms. Madigan said, "Because there is no known safe exposure level to asbestos, this careless and improper handling of a known carcinogen created a very serious danger to public health." Ms. Madigan's complaint alleges that both defendants failed to inspect and follow required work practices. Mr. Huff allegedly did not inspect the area for the presence of asbestos before the start of the renovation as required by National Emission Standards for Hazardous Air Pollutants (NESHAP) regulations. In addition, the complaint alleges that Mr. Huff allegedly failed to limit access to the work area and allowed it to be reoccupied before proper cleanup and air monitoring. The complaint alleges that Mr. Slotky violated regulations pertaining to the removal of asbestos-containing materials when he removed them and loaded them in unsealed plastic bags. NESHAP regulations require the use of proper containers distinctly marked with warning labels and the delivery of materials to a licensed facility. Additionally, the complaint alleges that Mr. Slotky failed to properly contain the area where he was removing the flooring materials and failed to properly decontaminate the external surfaces of containers and equipment contaminated by the asbestos containing materials. Ms. Madigan's lawsuit asks the court to prohibit the defendants from further violations of environmental law and to impose a monetary penalty and other relief deemed appropriate by the Court. In March 2006, an Illinois Department of Public Health (IDPH) inspection found piles of dry broken and chipped flooring materials and carpeting on site, and an analysis of the samples confirmed that they contained asbestos. The complaint notes that the building owner repeatedly failed to hire a licensed asbestos contractor as demanded by IDPH following the discovery of the materials and the improper procedures at the site and failed to respond to the emergency stop work order issued and posted. Assistant Attorney General Raymond Callery is handling the case for Ms. Madigan's Environmental Bureau. ASBESTOS LITIGATION: Vancouver Workers Back to Work After Scare --------------------------------------------------------------- Drydock workers from Vancouver, Canada are back to work on March 3, 2008 after an asbestos scare forced them off the job on Feb. 27, 2008, CKNW reports. There are many areas with asbestos on a ship, but most had been sealed off for safety. Union president Toby Charette says specialists were brought in as soon as a new pocket of asbestos was found. He said, "There was a company in there called Westcor. They were going in and going through the whole ship again and ensuring that there was no asbestos around and cleaning up whatever was there." As many as 100 workers may have been exposed to asbestos. ASBESTOS LITIGATION: Worker Sues Chesterton, 29 Firms in Texas -------------------------------------------------------------- An asbestos-related lawsuit filed by Paul A. Wilhelm against A.W. Chesterton Co. and 29 other companies is pending in Jefferson County District Court, Tex., The Southeast Texas Record reports. In the suit filed on July 19, 2007, Mr. Wilhelm sues for conspiring to mine, process and sell asbestos products, suppressing the information pertaining to the fiber's hazardous influence on human health and purposely inflicting him with an asbestos disease. Mr. Wilhelm's wife, Moye, is also a plaintiff in the suit. According to Mr. Wilhelm's original petition, companies such as American Standard Companies Inc., General Electric Company, and Zurn Industries Inc. knew that the asbestos products they manufactured would hit the market without inspection for defects. The suit says the defendants have been in possession of medical and scientific data exposing the health risks of asbestos for decades, but conspired among themselves to suppress the information. The suit indicates that Mr. Wilhelm, a man of may trades, was most likely exposed to asbestos while working at shipyards, steel mills, refineries, paper mills, chemical plants, the military and other facilities in the U.S. However, the suit does not give specifics on the location or time of his employment. Mr. Wilhelm is suing for physical pain and suffering in the past and future, mental anguish in the past and future, lost wages, loss of earning capacity, disfigurement in the past and future, physical impairment in the past and future, and past and future medical expenses, including homecare costs. He also seeks punitive and exemplary damages. Judge Gary Sanderson, 60th Judicial District, will preside over Case No. B181-370. ASBESTOS LITIGATION: Mining Sites' Hazard Limit Set Last Feb. 29 ---------------------------------------------------------------- The U.S. Mine Safety and Health Administration, on Feb. 29, 2008, issued a ruling, for mining operations nationwide, that limits asbestos exposure to two fibers per cubic centimeter, The Associated Press reports. That limit already is in place for industries covered by the U.S. Occupational Safety and Health Administration. MSHA's previous limit was 20 times higher than OSHA's cap. The final rule applies to exposure at metal and nonmetal mines, surface coal mines and surface areas of underground coal mines. The U.S. Department of Labor recommended that MSHA toughen its standard after news reports in 1999 linked asbestos contamination at the now-closed W.R. Grace and Co. vermiculite mine in Libby, Mont., to an unusually large number of deaths and illnesses. The vermiculite mine provided material for various household products, fireproofing and insulation. It also blew tremolite asbestos all over Libby. Tremolite asbestos is blamed by some health authorities for killing about 200 people and sickening one of every eight Libby residents. Acting MSHA director Richard Stickler said the new asbestos exposure limit would "help improve health protection for miners who work in an environment where asbestos is present." Mr. Stickler added, "Furthermore, it will help lower the risk of material impairment of health or functional capacity over a miner's working lifetime." Celeste Monforton, a former MSHA staffer and a public health researcher at George Washington University, said the new limit is good but does not go far enough. ASBESTOS LITIGATION: Americana Tenants Awarded $7,500 in Damages ---------------------------------------------------------------- Commissioner Steven Yep awarded US$7,500 to Ab and Mina Hashemi, who are former Americana apartment complex tenants exposed to asbestos fibers during a botched roofing job in October 2007, Mountain View VOICE reports. The court in Mountain View, Calif., awarded the Hashemis US$7,500, the small claims maximum, to compensate for damages from toxic asbestos contamination that destroyed furniture and clothes. Due to the roofing job, which shook dust particles down from the ceilings of upper-floor apartments, more than a dozen tenants were exposed to asbestos in Americana's Building Five on Continental Circle. The dust settled on clothes and furniture that no one would guarantee was clean -- even after the landlord, a company called Prometheus, had a team of workers go through each apartment with HEPA vacuums and special wipes. Mr. Hashemi estimated damages of over US$13,000 for two couches, several business suits and patio furniture that he had to leave behind because it was still covered in asbestos dust. Linda Rodriguez, appearing on behalf of Prometheus, admitted that "This was an unfortunate learning experience," and blamed the problem on the roof, which was unknown to be missing a necessary piece of sheet metal above the ceiling. Ms. Rodriguez said that 18 of the complex's 24 buildings were built between 1969 and 1972, and that asbestos is in the ceiling's fire retardant "popcorn" and in the tape used to fill gaps in the drywall. Residents say workers, who apparently did not know about the asbestos, pounded violently on the roof and even cut right through the ceiling during the project. At one point, a hole in the roof led to water damage in some apartments after the first of the season's winter storms hit. The company's own documents showed that asbestos was found in Mr. Hashemi's apartment at four times the limit an environmental contractor found to be safe. Ms. Rodriguez said that tenants were quickly notified of the problem and apartments were sealed off. However in court, Mr. Hashemi played a phone message from Prometheus manager Mike Drouin telling the couple that air sampling for their apartment had come back "absolutely perfect" several days after the problem started. "Unfortunately there's no hard and fast standards," for dealing with asbestos cleanup, Ms. Rodriguez said, adding that the company paid US$700 in moving expenses to the Hashemis and offered to have clothes dry cleaned at a nearby cleaner. The Hashemis argued that dry cleaning the clothes would not only be ineffective, according to standards of the Occupational Safety and Health Administration, but that it would contaminate other people's clothes as well. ASBESTOS LITIGATION: Groups Blast Canadian Gov't. Over Policies --------------------------------------------------------------- A number of environment, health and labor groups challenge the Canadian government to stop promoting the interests of the asbestos industry and instead help the growing number of Canadians who are suffering and dying from asbestos-related disease, according to a Ban Asbestos Canada press release dated Feb. 29, 2008. Kathleen Ruff, founder of RightOnCanada, a citizens' human rights group, said, "It is particularly heartless that the Canadian government, which put asbestos-contaminated Zonolite insulation in the houses of First Nations people living on reserves, has refused to take any responsibility for removing the deadly material or helping the victims." Larry Stoffman, chair of the National Committee on Environmental and Occupational Exposures, said, "Canada's record on asbestos is shameful. We are one of the few industrialized countries who have rejected the call by the World Health Organization and all the independent, recognized scientific organizations around the world to ban all forms of asbestos." Increasing numbers of Canadian are dying from asbestos, the world's biggest occupational health killer. In 2007, in British Columbia, for example, over half of occupational deaths were from asbestos-related disease. Anthony Pizzino, national research director of the Canadian Union of Public Employees, said, "Yet the Canadian government refuses to even set up a registry to keep track of the increasing number of Canadians falling sick and dying from asbestos-caused disease. It seems they just don't care." While the Canadian government turns a deaf ear to those whose lives have been devastated by asbestos, it has given CDN20 million over the years to the asbestos industry. The science that asbestos is deadly and must be banned is indisputable, but the Harper government is continuing devious strategies to avoid action. Instead of acting, the government continues to deny the science and blocks action on asbestos both in Canada and internationally. ASBESTOS LITIGATION: 160 Workers to File Lawsuit v. Japan Gov't. ---------------------------------------------------------------- About 160 construction workers and bereaved families from Tokyo, Chiba and Saitama prefectures in Japan are to file an asbestos- related lawsuit as early as May 2008 with the Tokyo District Court, The Yomiuri Shimbun reports. According to the plaintiffs, they may demand JPY35 million compensation per person from the central government, which they say failed to take due action to prevent health damage related to exposure to asbestos. Most of the plaintiffs have been officially recognized as suffering workplace-related sickness, and are receiving compensation for absence from work. Others are receiving compensation for the loss of a dead family member's pension. However, they aim to use the lawsuit to pin ultimate responsibility on the government, alleging that many sicknesses and deaths could have been avoided if the government had issued strong warnings against the dangers posed by asbestos. Thirty-eight construction workers and others are expected to file a similar suit with the Yokohama District Court. According to the Health, Labor and Welfare Ministry, the lawsuit will be the largest of the asbestos-related suits. Currently, such lawsuits are proceeding at the Osaka and Kobe district courts. According to the plaintiffs in the Tokyo case, materials including asbestos remained in use for construction even after the World Health Organization and other international entities pointed out the carcinogenic nature of asbestos. They also allege that insufficient attention was paid to ensuring the safety of demolition workers. They point out that while the government banned the use and production of asbestos in 2006, it could have taken such measures earlier. Seventy eight-year-old Kazuo Miyajima, leader of the plaintiffs, worked as a construction-site electrician from the age of 15. He was found to have lung cancer five years ago, and said he first thought it was because of cigarettes, which he had been smoking since he was young. However, Mr. Miyajima eventually found it was because of his job after pleural plaques was found in his lungs. Mr. Miyajima said, "We only ever covered our mouths with a towel even though the construction sites were covered in dust. Our work clothes became white with the dust. I had absolutely no idea at that time that asbestos was hazardous." ASBESTOS LITIGATION: Inquest Links U.K. Worker's Death to Hazard ---------------------------------------------------------------- An inquest at Rotherham, South Yorkshire, England, linked the death of 73-year-old John Martin, a former power station worker at Cottam Power Station, to asbestos, The Star reports. Mr. Martin worked lagging pipes at the station, near Nottingham, for 10 years from 1969. However, it was only after Mr. Martin's death, from mesothelioma, at Rotherham Hospice in October 2007 that his family discovered his job had involved working with deadly asbestos. Pathologist Dr. Terry Marshall said Mr. Martin, who was otherwise in good health, was found to be suffering from the cancer-like condition. Solicitor Simone Hardy, acting for Mr. Martin's widow Shirley, said, "The dangers of asbestos dust from lagging insulation on pipework and boilers was well known at the time and Mr. Martin's employers should have protected him from this hazard." Coroner Stanley Hooper recorded a verdict of death from industrial disease. Mrs. Martin's solicitor is appealing for anyone who worked with Mr. Martin at the Cottom Power Station in the 1970s to contact her about the working conditions at the time. ASBESTOS LITIGATION: Rigby's Widow Raises Awareness of Asbestos --------------------------------------------------------------- Vera Rigby, the widow of former electrician Barrie Rigby who was killed by exposure to asbestos, is fighting to raise awareness of the deadly material, Manchester Evening News reports. Mrs. Rigby was a speaker at Manchester town hall for Action Mesothelioma Day on Feb. 27, 2008 as hundreds of balloons were released to raise awareness. Mrs. Rigby said, "Nationally there are more deaths from asbestos exposure than from car crashes. Look at the emphasis we place on reducing speeding - yet I still find plumbers and electricians who couldn't even tell you what asbestos looks like." Mr. Rigby died in 2005 at the age of 62. He had worked in a number of cotton mills in Oldham, England, and regularly inhaled asbestos as he disturbed pipework during the course of his work. He stopped working in the mills in the early 1970s to become a lecturer. On his granddaughter's first birthday in 2003, Mr. Rigby was diagnosed with mesothelioma. ASBESTOS LITIGATION: Hanover Has $19.4M A&E Reserves at Dec. 31 --------------------------------------------------------------- The Hanover Insurance Insurance Group, Inc.'s recorded asbestos and environmental reserves were US$19.4 million at Dec. 31, 2007, compared with US$24.7 million at Dec. 31, 2006, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The Company's actuarial point estimate for A&E reserves was US$20 million at Dec. 31, 2007, compared with US$20.5 million at Dec. 31, 2006. The Company's asbestos reserves were US$11.3 million for the year ended Dec. 31, 2007, compared with US$13.6 million for the year ended Dec. 31, 2006. In addition, the Company has established loss and LAE reserves for assumed reinsurance pool business with asbestos, environmental damage and toxic tort liability of US$56.9 million in 2007 and US$57 million in 2006. These reserves relate to pools in which the Company has terminated its participation. However, the Company continues to be subject to claims related to years in which it was a participant. The Company participated in the Excess and Casualty Reinsurance Association voluntary pool during 1950 to 1982, until it was dissolved and put in runoff in 1982. The Company's percentage of the total pool liabilities varied from one percent to six percent during these years. The Company's participation in this pool has resulted in asbestos and environmental average paid losses of about US$2 million annually over the past 10 years. Based in Worcester, Mass., The Hanover Insurance Group, Inc. (f/k/a Allmerica Financial Corporation) is an all-around property/casualty insurance holding company. The Company sells its products through a network of independent agents in the midwestern, northeastern, and southeastern United States, but Michigan and Massachusetts account for more than 50 percent of the Company's business. ASBESTOS LITIGATION: Lawsuits v. ENSCO Pending in Miss., Calif. --------------------------------------------------------------- Asbestos-related lawsuits are pending against ENSCO International Incorporated in Mississippi and California courts, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. In August 2004, the Company and certain current and former subsidiaries were named as defendants, along with numerous other third party companies as co-defendants, in three multi-party lawsuits filed in the Circuit Courts of Jones County (2nd Judicial District) and Jasper County (1st Judicial District), Miss. The lawsuits sought an unspecified amount of monetary damages on behalf of individuals alleging personal injury or death, primarily under the Jones Act, purportedly resulting from exposure to asbestos on drilling rigs and associated facilities during the period 1965 through 1986. In compliance with the Mississippi Rules of Civil Procedure, the individual claimants in the original multi-party lawsuits whose claims were not dismissed were ordered to file either new or amended single plaintiff complaints naming the specific defendant(s) against whom they intended to pursue claims. As a result, out of more than 600 initial multi-party claims, the Company has been named as a defendant by 66 individual plaintiffs. Of these claims, 63 claims or lawsuits are pending in Mississippi state courts and three are pending in the U.S. District Court as a result of their removal from state court. At present, none of the pending Mississippi asbestos lawsuits against the Company has been set for trial. In addition to the pending cases in Mississippi, the Company recently received a letter demanding that it defend and indemnify two parties that formerly held an interest in a predecessor company named in a lawsuit pending in the Superior Court of the State of California. The demand arises under the terms and conditions of an Assumption Agreement given by the Company's predecessor, Penrod Drilling Corporation. The plaintiff seeks monetary damages allegedly arising from exposure to asbestos or products containing asbestos while employed by Penrod. The Company has yet to conduct discovery. Dallas-based ENSCO International Incorporated is an international offshore contract drilling company. As of Feb. 15, 2008, the Company's offshore rig fleet included 44 jackup rigs, one ultra-deepwater semisubmersible rig and one barge rig. Additionally, the Company has four ultra-deepwater semi- submersible rigs under construction. ASBESTOS LITIGATION: 114 Suits Pending v. Curtiss-Wright in Dec. ---------------------------------------------------------------- The Company has been named in about 114 pending lawsuits that allege injury from exposure to asbestos, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. In addition, to date, the Company has secured dismissals with prejudice and without prejudice in about 50 and 107 lawsuits, respectively, and is in discussions for similar dismissal of several other lawsuits, and has not been found liable or paid any material sum of money in settlement in any case. The Company said it believes that the minimal use of asbestos in its past and current operations and the relatively non-friable condition of asbestos in its products makes it unlikely that it will face material liability in any asbestos litigation, whether individually or in the aggregate. The Company faced about 120 lawsuits that allege injury from exposure to asbestos. (Class Action Reporter, March 9, 2007) Roseland, N.J.-based Curtiss-Wright Corporation designs and manufactures highly engineered, advanced technologies that perform critical functions in demanding conditions in the defense, commercial aerospace, energy, and general industrial markets. The Company's general industrial markets include high- performance automotive, construction, simulation and test equipment, and engineering services. ASBESTOS LITIGATION: Hercules Offshore Faces Lawsuit from TODCO --------------------------------------------------------------- Hercules Offshore, Inc. faces an asbestos-related lawsuit from TODCO, which the Company acquired in July 2007, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 27, 2008. The case is styled Robert E. Aaron et al. vs. Phillips 66 Company et al. Circuit Court, Second Judicial District, Jones County, Miss. This is the case name used to refer to several cases that have been filed in the Circuit Courts of the State of Mississippi involving 768 persons that allege personal injury or whose heirs claim their deaths arose out of asbestos exposure in the course of their employment by the defendants between 1965 and 2002. The complaints name as defendants certain of TODCO's subsidiaries and certain of subsidiaries of TODCO's former parent to whom TODCO may owe indemnity and other unaffiliated defendant companies, including companies that allegedly manufactured drilling related products containing asbestos that are the subject of the complaints. The number of unaffiliated defendant companies involved in each complaint ranges from about 20 to 70. The complaints allege that the defendant drilling contractors used asbestos-containing products in offshore drilling operations, land based drilling operations and in drilling structures, drilling rigs, vessels and other equipment and assert claims based on negligence and strict liability, and claims authorized under the Jones Act. The plaintiffs seek awards of unspecified compensatory and punitive damages. All of these cases were assigned to a special master who has approved a form of questionnaire to be completed by plaintiffs so that claims made would be properly served against specific defendants. As of Feb. 27, 2008, about 700 questionnaires were returned and the remaining plaintiffs, who did not submit a questionnaire reply, have had their suits dismissed without prejudice. Of the respondents, about 100 shared periods of employment by TODCO and its former parent which could lead to claims against either company, even though many of these plaintiffs did not state in their questionnaire answers that the employment actually involved exposure to asbestos. After providing the questionnaire, each plaintiff was further required to file a separate and individual amended complaint naming only those defendants against whom they had a direct claim as identified in the questionnaire answers. Defendants not identified in the amended complaints were dismissed from the plaintiffs' litigation. To date, three plaintiffs named TODCO as a defendant in their amended complaints. The Company said that it is possible that some of the plaintiffs who have filed amended complaints and have not named TODCO as a defendant may attempt to add TODCO as a defendant in the future when case discovery begins and greater attention is given to each individual plaintiff's employment background. The Company continues to monitor a small group of these other cases. The Company has not determined which entity would be responsible for such claims under the Master Separation Agreement between TODCO and its former parent. Houston-based Hercules Offshore, Inc. provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the U.S. Gulf of Mexico and internationally. In July 2007, completed the acquisition of TODCO for total consideration of about US$2.398 billion, consisting of US$925.8 million in cash and 56.6 million shares of common stock. ASBESTOS LITIGATION: Foster Wheeler Cites $376.8M Dec. Liability ---------------------------------------------------------------- Foster Wheeler Ltd.'s long-term asbestos related liability was US$376,803,000 as of Dec. 28, 2007, compared with US$424,628,000 as of Dec. 29, 2006, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. The Company's long-term asbestos-related liability amounted to US$363,478,000 as of Sept. 28, 2007. (Class Action Reporter, Nov. 23, 2007) The Company's long-term asbestos-related insurance recovery receivable was US$324,588,000 as of Dec. 28, 2007, compared with US$350,322,000 as of Dec. 29, 2006. The Company's long-term asbestos-related insurance recovery receivable amounted to US$311,279,000 as of Sept. 28, 2007. (Class Action Reporter, Nov. 23, 2007) The Company's deferred tax assets for asbestos claims amounted to US$32,790,000 as of Dec. 28, 2007, compared with US$43,493,000 as of Dec. 29, 2006. Some of the Company's U.S. and U.K. subsidiaries are defendants in numerous asbestos-related lawsuits and out-of-court informal claims pending in the United States and the United Kingdom. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to or use of asbestos in connection with work allegedly performed by Company subsidiaries during the 1970s and earlier. Clinton, N.J.-based Foster Wheeler Ltd., which is an international engineering and construction contractor, designs, builds, and upgrades oil and gas processing facilities and manufactures power equipment through its two business units: Global Engineering & Construction and Global Power. ASBESTOS LITIGATION: Foster Wheeler Records 131,340 U.S. Claims --------------------------------------------------------------- Foster Wheeler Ltd.'s subsidiaries in the United States faced 131,340 open asbestos claims for the year ended Dec. 28, 2007, compared with 135,890 open claims for the year ended Dec. 29, 2006, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. The Company recorded 132,810 open asbestos-related claims filed against its U.S. subsidiaries during the three and nine months ended Sept. 28, 2007, compared with 150,800 claims during the three and nine months ended Sept. 29, 2006. (Class Action Reporter, Nov. 23, 2007) For the year ended Dec. 28, 2007, the Company noted 5,140 new U.S. claims filed, 9,690 U.S. claims resolved, 66,040 U.S. claims not valued in the liability, and 65,300 U.S. claims valued in the liability at the end of the year. For the year ended Dec. 29, 2006, the Company noted 8,250 new U.S. claims filed, 37,180 U.S. claims resolved, 47,820 U.S. claims not valued in the liability, and 88,070 U.S. claims valued in the liability at the end of the year. Of about 131,000 open claims, the Company's subsidiaries are respondents in about 31,000 open claims wherein the Company has administrative agreements and are named defendants in lawsuits involving about 100,000 plaintiffs. About 65 percent do not specify the monetary damages sought or merely recite that the amount of monetary damages sought meets or exceeds the required jurisdictional minimum in the jurisdiction in which suit is filed. About 11 percent request damages ranging from US$10,000 to US$50,000. About 11 percent request damages ranging from US$51,000 to US$1,000,000. About 10 percent request damages ranging from US$1,001,000 to US$10,000,000. The remaining three percent request damages ranging from US$10,001,000 to, in a very small number of cases, US$50,000,000. Total asbestos-related assets for U.S. claims was US$326,200,000 for the year ended Dec. 28, 2007, compared with US$363,700,000 for the year ended Dec. 29, 2006. Total asbestos-related liabilities for U.S. claims was US$403,300,000 for the year ended Dec. 28, 2007, compared with US$466,000,000 for the year ended Dec. 29, 2006. In connection with updating its estimated asbestos liability and related asset, the Company recorded a charge of US$7,400,000 in the fourth quarter of 2007. The amount paid on asbestos litigation, defense, and case resolution was US$86,700,000 in fiscal year 2007 and US$83,300,000 in fiscal year 2006. Through Dec. 28, 2007, total cumulative indemnity costs paid were about US$625,300,000 and total cumulative defense costs paid were about US$248,400,000. As of Dec. 28, 2007, total asbestos-related liabilities were comprised of an estimated liability of US$165,100,000 relating to open (outstanding) claims being valued and an estimated liability of US$238,200,000 relating to future unasserted claims through year-end 2022. Clinton, N.J.-based Foster Wheeler Ltd., which is an international engineering and construction contractor, designs, builds, and upgrades oil and gas processing facilities and manufactures power equipment through its two business units: Global Engineering & Construction and Global Power. ASBESTOS LITIGATION: Foster Wheeler Records $27.6M for N.Y. Case ---------------------------------------------------------------- Foster Wheeler Ltd., as of Dec. 28, 2007, estimated the value of its unsettled asbestos insurance asset related to ongoing litigation in New York state court with its subsidiaries' insurers at US$27,600,000, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. The litigation relates to the amounts of insurance coverage available for asbestos-related claims and the proper allocation of the coverage among the Company's subsidiaries' various insurers and the Company's subsidiaries as self-insurers. An adverse outcome in the pending insurance litigation could limit the Company's remaining insurance recoveries and result in a reduction in its insurance asset. However, a favorable outcome in all or part of the litigation could increase remaining insurance recoveries above the Company's current estimate. If it prevails in whole or in part in the litigation, the Company will re-value its asset relating to remaining available insurance recoveries based on the asbestos liability estimated at that time. Over the last several years, certain Company subsidiaries have entered into settlement agreements calling for insurers to make lump-sum payments, as well as payments over time, for use by the Company's subsidiaries to fund asbestos-related indemnity and defense costs and, in certain cases, for reimbursement for portions of out-of-pocket costs previously incurred. In fiscal year 2006, Company subsidiaries reached agreements to settle their disputed asbestos-related insurance coverage with four of their insurers. Primarily as a result of these insurance settlements, the Company increased its asbestos-related insurance asset and recorded a gain of US$96,200,000 in fiscal year 2006. In fiscal year 2007, the Company's subsidiaries reached an agreement to settle their disputed asbestos-related insurance coverage with four additional insurers, including two in the fourth quarter. As a result of these settlements, the Company increased its asbestos-related insurance asset and recorded a gain of US$4,900,000 in the fourth quarter and US$13,500,000 in fiscal year 2007. Also in fiscal year 2006, the Company was successful in its appeal of a New York state trial court decision that previously had held that New York, rather than New Jersey, law applies in the above coverage litigation with the subsidiaries' insurers, and as a result, the Company increased its insurance asset and recorded a gain of US$19,500,000. On Feb. 13, 2007, the Company's subsidiaries' insurers were granted permission by the appellate court to appeal the decision to the New York Court of Appeals, the state's highest court. On Oct. 11, 2007, the New York Court of Appeals upheld the appellate court decision in the Company's favor. The Company funded US$19,000,000 of the asbestos liability indemnity payments and defense costs from its cash flows in fiscal year 2007, net of the cash received from insurance settlements. The Company expects to fund a total of US$25,000,000 of the asbestos liability indemnity and defense costs from its cash flows in fiscal year 2008, net of the cash expected to be received from existing insurance settlements. Clinton, N.J.-based Foster Wheeler Ltd., which is an international engineering and construction contractor, designs, builds, and upgrades oil and gas processing facilities and manufactures power equipment through its two business units: Global Engineering & Construction and Global Power. ASBESTOS LITIGATION: Foster Wheeler Has 342 U.K. Claims at Dec. --------------------------------------------------------------- Foster Wheeler Ltd.'s subsidiaries in the United Kingdom faced 342 open asbestos-related claims as of Dec. 28, 2007, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. As of Sept. 28, 2007, the Company recorded 343 open asbestos- related claims filed against its subsidiaries in the United Kingdom. (Class Action Reporter, Nov. 23, 2007) Some of the Company's subsidiaries in the United Kingdom have received claims alleging personal injury arising from exposure to asbestos. To date, 866 claims have been brought against the Company's U.K. Subsidiaries. None of the settled claims has resulted in material costs to the Company. As of Dec. 28, 2007, the Company had recorded total liabilities of US$48,500,000 comprised of an estimated liability relating to open (outstanding) claims of US$9,000,000 and an estimated liability relating to future unasserted claims through year-end 2022 of US$39,500,000. Of the total, US$3,000,000 was recorded in accrued expenses and US$45,500,000 was recorded in asbestos-related liability on the consolidated balance sheet. An asset in an equal amount was recorded for the expected U.K. asbestos-related insurance recoveries, of which US$3,000,000 was recorded in accounts and notes receivable-other and US$45,500,000 was recorded as asbestos-related insurance recovery receivable on the consolidated balance sheet. The liability estimates are based on a U.K. House of Lords judgment that pleural plaque claims do not amount to a compensable injury and accordingly, the Company has reduced its liability assessment. Should this ruling be reversed by legislation, the asbestos liability and related asset recorded in the U.K. would be about US$66,100,000. Clinton, N.J.-based Foster Wheeler Ltd., which is an international engineering and construction contractor, designs, builds, and upgrades oil and gas processing facilities and manufactures power equipment through its two business units: Global Engineering & Construction and Global Power. ASBESTOS LITIGATION: CIRCOR Records $9.7M Liability at Dec. 31 -------------------------------------------------------------- CIRCOR International, Inc.'s current asbestos liability was US$9,697,000 as of Dec. 31, 2007, compared with US$1,026,000 as of Dec. 31, 2006, according to a Company report, on Form 8-K, filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. The Company's long-term asbestos liability was US$7,062,000 as of Dec. 31, 2007. Revenues for the 2007 fourth quarter were US$174.5 million, an increase of three percent from US$169.6 million for the fourth quarter 2006 period. Net income for the fourth quarter of 2007 was US$10.1 million, or US$0.60 per diluted share, compared with US$10.4 million, or US$0.63 per diluted share, for the fourth quarter of 2006. Net income for the fourth quarter of 2007 includes net pre-tax charges of US$1.6 million, or US$0.06 per diluted share: (i) a US$0.10 per share charge to accrue estimated indemnity costs associated with open asbestos claims affecting the Company's Leslie Controls subsidiary; (ii) US$0.01 per diluted share for a charge related to accelerated vesting of equity awards for retiring executives; and (iii) US$0.05 per share from a gain on sale of the Company's former location in China. For the 12 months ended Dec. 31, 2007, revenues were US$665.7 million, an increase of 13 percent from US$591.7 million for 2006. Net income for the 12 months of 2007 was US$37.9 million, or US$2.27 per diluted share, an increase of 26 percent from US$29.3 million, or US$1.80 per diluted share, in the same period last year. Results for the 12 months of 2007 include net pre-tax charges of US$3.3 million, or US$0.15 per diluted share: (i) US$0.11 per diluted share for charge from accelerated vesting of equity awards for the Company's retiring executives; (ii) US$0.10 per diluted share for charge to accrue estimated indemnity costs associated with open asbestos claims affecting the Company's Leslie Controls subsidiary; (iii) US$0.05 per diluted share for charges related to facility consolidation; (iv) US$0.06 per diluted share from gain on sale of an unrelated business; and (v) US$0.05 per diluted share from gain on sale of a former Chinese manufacturing site. During the fourth quarter of 2007, the Company's Leslie Controls subsidiary, whose results are reported in Circor's Instrumentation and Thermal Fluid Controls Segment, recorded an additional liability of US$9.0 million for the estimated indemnity cost associated with resolution of its current open claims for asbestos-related litigation. The recording of this liability resulted in a pre-tax charge of US$2.6 million, or US$0.10 per share, net of insurance recoveries. Burlington, Mass.-based CIRCOR International, Inc. makes instrumentation and fluid regulation products, including precision valves, tube and pipe fittings, and regulators for hydraulic, pneumatic, cryogenic, and steam systems. The Company's remaining sales come from making valves and other products for the oil and gas industry. ASBESTOS LITIGATION: Canadian Home Operator Given CDN50,000 Fine ---------------------------------------------------------------- A Hanover retirement home operator, Retirement Residences Genpar Inc., failed to notify the Canadian Ministry of Labour of an asbestos removal project and was fined CDN50,000 in the Ontario Court of Justice on March 3, 2008, according to CNW Group press release dated March 5, 2008. Justice of the Peace Robert Gay heard that on March 27, 2006, maintenance workers employed by Retirement Residences Genpar Inc., which operated a retirement home at 101 Tenth St., Hanover, were at that location to remove a boiler from a boiler room. An asbestos-containing material, chrysotile, insulated the boiler. The company failed to notify the ministry of the work involving asbestos. The company pleaded guilty to failing, as an employer, to provide notice as required by section 11(1) of Ontario Regulation 278/05, contrary to section 66(1) of the Occupational Health and Safety Act. In addition to the fine, the court imposed a 25 percent victim fine surcharge, as required by the Provincial Offences Act. The surcharge is credited to a special provincial government fund to assist victims of crime. ASBESTOS LITIGATION: Wendell Couple of W.Va. Sues 38 Companies -------------------------------------------------------------- Houston Wendell and Patricia Wendell, on Jan. 28, 2008, filed an asbestos-related lawsuit against 38 companies in Kanawha Circuit Court, W.Va., The West Virginia Record reports. The Wendells claim that Mr Wendell developed mesothelioma after being exposed to asbestos fibers. He was employed by E.I. du Pont de Nemours and Company, located in Belle, W.Va., from 1941 to 1980. According to the suit, Mr. Wendell was unaware that he was being exposed to asbestos fibers, which caused him to develop mesothelioma. He claims his illness is progressive and essentially untreatable and incurable. Mr. Wendell also claims he is suffering from pneumoconiosis caused by the inhalation of products containing asbestos, other severe and disabling diseases of the body, shock and other attendant nervous or emotional disorders. Wendell claims the companies are at fault because they failed to warn him of the dangers associated with the asbestos found in the workplace. According to the suit, the defendants should have known of the dangers of asbestos and should have warned their employees. Mrs. Wendell claims she has lost the consortium, companionship, society and services of her husband. The Wendells claim they have suffered and will continue to suffer serious bodily injury, great pain and suffering and mental anguish, medical expenses, lost earnings and other damages. In the 11-count suit, the Wendells seek compensatory and punitive damages. Attorney William K. Schwartz represents the Wendells. Kanawha Circuit Court Case No. 08-C-188 will be assigned to a visiting judge. ASBESTOS LITIGATION: EnPro Faces 105,700 Open Cases at Dec. 31 -------------------------------------------------------------- Certain of EnPro Industries, Inc.'s subsidiaries, at Dec. 31, 2007, are defendants in 105,700 open asbestos-related cases, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. Certain of the Company's subsidiaries, primarily Garlock Sealing Technologies LLC and The Anchor Packing Company, are defendants in actions filed in various states by plaintiffs alleging injury or death as a result of exposure to asbestos fibers. Since the first asbestos-related lawsuits were filed against Garlock in 1975, Garlock and Anchor have processed about 900,000 asbestos claims to conclusion (including judgments, settlements and dismissals) and, together with their insurers, have paid about US$1.3 billion in settlements and judgments and over US$400 million in fees and expenses. Of those claims resolved, about three percent have been claims of plaintiffs alleging the disease mesothelioma, about six percent have been claims of plaintiffs with lung or other cancers, and more than 90 percent have been claims of plaintiffs alleging asbestosis, pleural plaques or other non-malignant impairment of the respiratory system. The mix of cases filed in 2007 contains about 26 percent mesothelioma claims and 19 percent lung or other cancer claims. In the remaining 55 percent of the new cases, either the plaintiffs alleged non-malignant impairment or the disease or condition is not alleged and remains unknown to the Company. Of the 105,700 open cases at Dec. 31, 2007, the Company is aware of about 9,500 (nine percent) that involve claimants alleging mesothelioma, lung cancer or some other cancer. The number of new actions filed against the Company's subsidiaries in 2007 (5,200) was lower than the number filed in 2006 (7,700). Charlotte, N.C.-based EnPro Industries, Inc. produces sealing products, metal polymer and filament wound bearings, compressor systems and components, diesel and dual-fuel engines and other engineered products for use in critical applications by industries worldwide. ASBESTOS LITIGATION: Garlock Sealing Involved in 9 Trials in '07 ---------------------------------------------------------------- EnPro Industries, Inc.'s subsidiary, Garlock Sealing Technologies LLC, in 2007, was involved in nine asbestos trials against 12 plaintiffs, according to the Company's annual report filed with the U.S. Securities and Exchange Commission on Feb. 26, 2008. Certain of the Company's subsidiaries, primarily Garlock and The Anchor Packing Company, are defendants in actions filed in various states by plaintiffs alleging injury or death as a result of exposure to asbestos fibers. Garlock's product defenses have enabled it to be successful at trial, winning defense verdicts in one of the two cases tried to verdict in 2007, and in 12 of 25 cases tried to verdict in the years 2004 through 2007. In the successful jury trials, the juries determined that either Garlock's products were not defective, that Garlock was not negligent, or that the claimant was not exposed to Garlock's products. In 2007, Garlock began nine trials. A Massachusetts jury returned a defense verdict in favor of Garlock. In a Kentucky case, the jury awarded the plaintiff US$145,000 against Garlock. Garlock plans to appeal this verdict. Four lawsuits in Pennsylvania settled during trial before the juries had reached a verdict. Garlock also settled cases during trial in Louisiana, Maryland and Washington. In 2006, Garlock began 10 trials involving 11 plaintiffs. Garlock received jury verdicts in its favor in Oakland, Calif.; Easton, Pa.; and Louisville, Ky. In Pennsylvania, three other lawsuits involving four plaintiffs settled during trial before the juries reached verdict. Garlock also settled cases in Massachusetts, California and Texas during trial. In a retrial of a Kentucky case, the jury awarded the plaintiff US$900,000 against Garlock. The award was significantly less than the US$1.75 million award against Garlock in the previous trial, which Garlock successfully appealed. Garlock has also appealed the new verdict. In addition, Garlock obtained dismissals in two cases in Philadelphia after the juries were selected but before the trials began because there was insufficient evidence of exposure to Garlock products. Charlotte, N.C.-based EnPro Industries, Inc. produces sealing products, metal polymer and filament wound bearings, compressor systems and components, diesel and dual-fuel engines and other engineered products for use in critical applications by industries worldwide. ASBESTOS LITIGATION: Garlock Appealing $1.4M in Verdicts for '07 ---------------------------------------------------------------- Three Garlock Sealing Technologies LLC appeals were pending from adverse verdicts totaling US$1.4 million at Dec. 31, 2007, down from US$6.8 million at Dec. 31, 2006, and more than US$41 million at Dec. 31, 2005. Certain of EnPro Industries, Inc.'s subsidiaries, primarily Garlock and The Anchor Packing Company, are defendants in actions filed in various states by plaintiffs alleging injury or death as a result of exposure to asbestos fibers. Garlock has historically enjoyed success in a majority of its appeals. In March 2006, a three-judge panel of the Ohio Court of Appeals, in a unanimous decision, overturned a US$6.4 million verdict that was entered against Garlock in 2003, granting a new trial. The case subsequently settled. On the other hand, the Maryland Court of Appeals denied Garlock's appeal from a 2005 Baltimore verdict, and Garlock paid that verdict, with post-judgment interest, in the fourth quarter of 2006. In a separate Baltimore case in the fourth quarter of 2006, the Maryland Court of Special Appeals denied Garlock's appeal from another 2005 verdict. The subsequent appeal of that decision was also denied and Garlock paid that verdict in the second quarter of 2007. In June 2007, the New York Court of Appeals, in a unanimous decision, overturned an US$800,000 verdict that was entered against Garlock in 2004, granting a new trial. At Dec. 31, 2007, the Company had US$1.1 million of cash collateral relating to appeal bonds recorded as restricted cash on the Consolidated Balance Sheet. This amount was reduced from US$1.3 million at Dec. 31, 2006 and US$41.1 million at Dec. 31, 2005. Charlotte, N.C.-based EnPro Industries, Inc. produces sealing products, metal polymer and filament wound bearings, compressor systems and components, diesel and dual-fuel engines and other engineered products for use in critical applications by industries worldwide. ASBESTOS LITIGATION: Garlock Settlement Commitments Total $76Mil ---------------------------------------------------------------- Garlock Sealing Technologies LLC's new settlement commitments total US$76 million in 2007, compared with US$84 million in 2006. Certain of EnPro Industries, Inc.'s subsidiaries, primarily Garlock and The Anchor Packing Company, are defendants in actions filed in various states by plaintiffs alleging injury or death as a result of exposure to asbestos fibers. Garlock settles and disposes of actions on a regular basis. Garlock's historical settlement strategy was to settle only cases in advanced stages of litigation. In 1999 and 2000, however, Garlock employed a more aggressive settlement strategy. The purpose of this strategy was to achieve a permanent reduction in the number of overall asbestos claims through the settlement of a large number of claims, including some early-stage claims and some claims not yet filed as lawsuits. Due to this short-term aggressive settlement strategy and a significant overall increase in claims filings, the settlement amounts paid in those years and several subsequent years were greater than the amounts paid in any year prior to 1999. In 2001, Garlock resumed its historical settlement strategy and focused on reducing settlement commitments to match insurance recoveries. As a result, Garlock reduced new settlement commitments from US$180 million in 2000 to US$94 million in 2001 and US$86 million in 2002. About US$15 million of the 2006 amount and about US$5 million of the 2007 amount were committed in settlements in 2006 to pay verdicts that had been rendered in the years 2003-2005. Charlotte, N.C.-based EnPro Industries, Inc. produces sealing products, metal polymer and filament wound bearings, compressor systems and components, diesel and dual-fuel engines and other engineered products for use in critical applications by industries worldwide. ASBESTOS LITIGATION: Garlock Has $381.5M Coverage at Dec. 31 ------------------------------------------------------------ Garlock Sealing Technologies, LLC, at Dec. 31, 2007, had available US$381.5 million of solvent insurance and trust coverage. Certain of EnPro Industries, Inc.'s subsidiaries, primarily Garlock and The Anchor Packing Company, are defendants in actions filed in various states by plaintiffs alleging injury or death as a result of exposure to asbestos fibers. The Company said it believes the US$381.5 million will be available to cover future asbestos claims and certain expense payments. In addition, at Dec. 31, 2007, Garlock classified US$56 million of otherwise available insurance as insolvent. The Company said it believes that Garlock will recover some of the insolvent insurance over time. In fact, Garlock collected about US$1 million from insolvent carriers in 2007, bringing total collections from insolvent carriers from 2002 through 2007 to about US$39.3 million. Of the US$381.5 million of collectible insurance and trust assets, the Company considers US$333 million (87 percent) to be of high quality. The Company considers US$48 million (13 percent) to be of moderate quality because the insurance policies are written with (a) other solvent U.S. carriers who are unrated or below investment grade (US$42 million) or (b) with various London market carriers (US$6 million). Of the US$381.5 million, US$252 million is allocated to claims that have been paid by Garlock and submitted to its insurance companies for reimbursement and the remainder is allocated to pending and estimated future claims. During the fourth quarter of 2006, the Company reached an agreement with a significant group of related U.S. insurers. These insurers had withheld payments pending resolution of a dispute. The agreement provides for the payment of the full amount of the insurance policies (US$194 million) in various annual payments to be made from 2007 through 2018. Under the agreement, Garlock received US$22 million in 2007. In May 2006, the Company reached agreement with a U.S. insurer that resolved two lawsuits and an arbitration proceeding. Under that settlement, Garlock received US$3 million in 2007 and US$4 million in 2006 and will receive another US$14 million in the future. During the first quarter of 2005, the Company reached agreement with two of Garlock's U.S. insurers. The insurers agreed to pay Garlock a total of US$21 million in three equal bi-annual payments of US$7 million. The first and second payments were received in May 2005 and April 2007. The third payment is due in May 2009. In the second quarter of 2004, the Company reached agreement with Equitas, the London-based entity responsible for the pre- 1993 Lloyds' of London policies in the Company's insurance block, concerning settlement of its exposure to the Company's subsidiaries' asbestos claims. As a result of the settlement, US$88 million was placed in an independent trust. In the fourth quarter of 2004, the Company reached agreement with a group of London market carriers (other than Equitas) and one of its U.S. carriers that has some policies reinsured through the London market. As a result of the settlement, US$55.5 million was placed in an independent trust. At Dec. 31, 2007, the market value of the funds remaining in the two trusts was US$43.6 million, which was included in the US$382 million of insurance and trust coverage available to pay future asbestos- related claims and expenses. The Company's liability as of Dec. 31, 2007 was US$524.4 million. The total liability as of Dec. 31, 2007, included US$86.9 million classified as a current liability and US$437.5 million classified as a non-current liability. Charlotte, N.C.-based EnPro Industries, Inc. produces sealing products, metal polymer and filament wound bearings, compressor systems and components, diesel and dual-fuel engines and other engineered products for use in critical applications by industries worldwide. ********* 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 re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. 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