/raid1/www/Hosts/bankrupt/CAR_Public/080528.mbx
C L A S S A C T I O N R E P O R T E R
Wednesday, May 28, 2008, Vol. 10, No. 105
Headlines
1-800-FLOWERS.COM: Still Faces FACTA Violations Lawsuit in Fla.
ALLIANCE DATA: Settles Texas Litigation Over Aladdin Merger Deal
CABLEVISION SYSTEMS: Court Orders Discovery in Stock Swap Suit
CABLEVISION SYSTEMS: Condition in N.Y. Suit Settlement Not Met
CABLEVISION SYSTEMS: Faces Antitrust Litigation in California
CABLEVISION SYSTEMS: N.Y. Shareholder Lawsuits Remain Stayed
CALPINE CORP: Faces Texas Suit Over $9.6-Bln. Sale to NRG Energy
CLAYTON HOMES: Continues to Face Lawsuit Over Manufactured Homes
CUMULUS MEDIA: Settles Cloud Merger Lawsuit; Still Faces Others
DAM OWNERS: Birchwood Lakes Agrees to Settle Rancocas Creek Suit
DRUGSTORE.COM INC: Faces FCRA Violations Lawsuit in Washington
GOLD FIELDS: Continues to Face Suits in Okla. Over Lead Exposure
HANARO TELECOM: Continues to Face Suit Over Information Leak
INDIANA FSSA: Residents Sue Over Medicaid Termination/Denial
INSPIRE PHARMACEUTICALS: Nixing of N.C. Securities Suit Appealed
ISTAR FINANCIAL: Faces Securities Fraud Litigation in New York
JUNIPER NETWORKS: Calif. Court Dismisses Certain Claims in Suit
KEYSTONE AUTOMOTIVE: Calif. Court Gives Final Okay to Settlement
KOSA LTD: Settles Antitrust Suit in North Carolina for $33 Mln.
MERALCO (PHILS.): NGOs Threaten Anew to Sue Over Power Rates
PDI INC: Faces Suits Arising From Use of Baycol Medication
PHARMANET DEVELOPMENT: Final OK for $28.5MM Settlement Appealed
RAIT FINANCIAL: Seeks Dismissal of Pa. Securities Fraud Lawsuit
REGIONAL CONTRACTORS: Face Calif. Suit Over Labor Code Breach
TAKE 2 INTERACTIVE: GTA Suit Deal Fairness Hearing Set June 25
TRIZETTO GROUP: Faces Del., Calif. Suits Over Proposed Apax Deal
UNITED PARCEL: Must Face "Mom & Pop" Franchisees Trial in Calif.
UNITED PARCEL: Appeals Court Reverses Favorable "Marlo" Ruling
UNITED PARCEL: Faces Antitrust Suit Over Fuel Surcharge Rates
UNUM GROUP: Court Approves $40-Mln Settlement in Investors' Suit
VALUECLICK INC: Seeks Dismissal of California Securities Lawsuit
WEST CORP: Expert Discovery Ongoing in "Sanford" Litigation
WEST CORP: Sup. Ct. Upholds Certification of Class in "Ritt"
* Class Action Powerhouse Schneider & Wallace Changes Firm Name
* Ohio Securities Case Widens to Include Housing Market Losses
New Securities Fraud Cases
AMERICAN INSURANCE: Florida Pension Fund Files Lawsuit in N.Y.
ARBITRON INC: Brower Piven Files Securities Fraud Suit in N.Y.
DOWNEY FINANCIAL: Brower Piven Files Securities Suit in Calif.
MGIC INVESTMENT: Brower Piven Files Securities Suit in Michigan
TRM CORP: Schatz Nobel Files Oregon Securities Fraud Lawsuit
Meetings, Conferences & Seminars
* Scheduled Events for Class Action Professionals
* Online Teleconferences
*********
1-800-FLOWERS.COM: Still Faces FACTA Violations Lawsuit in Fla.
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1-800-Flowers.Com, Inc., and its subsidiary, 1-800-Flowers
Retail, Inc., continue to face a class action lawsuit in
Florida, alleging violations of the federal Fair and Accurate
Credit Transaction Act.
In October 2007, the defendants were served with a purported
nationwide class action suit, entitled "Grabein v. 1-800-
Flowers.Com., Inc., et al; Case No. 07-22235," which was filed
with the U.S. District Court for the Southern District of
Florida.
The complaint claims violation of FACTA based on the allegation
that the company printed or provided receipts to consumers at
the point of sale or transaction on which receipts appeared more
than the last five digits of customers' credit or debit card
numbers and the expiration dates of such cards.
The complaint does not specify any actual damages for any
member of the purported class. However, the complaint does seek
statutory damages of $100 to $1,000 for each proven alleged
willful violation of the statute, if any, as well as,
attorneys' fees, costs, unspecified punitive damages and a
permanent injunction.
The company reported no development in the matter in its May
2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended March 30, 2008.
The suit is "Grabein v. 1-800-Flowers.com, Inc. et al., Case No.
1:07-cv-22235-PCH," filed in the U.S. District Court for the
Southern District of Florida, Judge Paul C. Huck, presiding.
Representing the plaintiffs are:
John Elliott Leighton, Esq. (Leighton@Leesfield.com)
Leesfield Leighton & Partners
2350 S. Dixie Highway
Miami, FL 33133
Phone: 305-854-4900
Fax: 305-854-8266
- and -
Jay Mitchell Levy, Esq. (jay@jaylevylaw.com)
Jay M. Levy, P.A.
9130 S. Dadeland Boulevard
Suite 1510 Two Datran Center
Miami, FL 33156
Phone: 305-670-8100
Fax: 305-670-4827
Representing the defendants are:
David E. Block, Esq. (blockd@jacksonlewis.com)
Jackson Lewis LLP
2 S Biscayne Boulevard
Suite 3500 One Biscayne Tower
Miami, FL 33131-1802
Phone: 305-577-7600
Fax: 305-373-4466
- and -
Thomas E. Plastaras, Esq. (tplastaras@1800flowers.com)
Gallagher Walker Bianco & Plastaras
98 Willis Avenue
Mineola, NY 11501-2611
Phone: 516-248-2002
Fax: 516-248-2394
ALLIANCE DATA: Settles Texas Litigation Over Aladdin Merger Deal
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Alliance Data Systems Corp. reached a settlement for a
consolidated class action suit in Texas over a merger agreement
by the company with Aladdin Holdco, Inc., and Aladdin Merger
Sub, Inc., according to the company's May 2008 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2008.
On May 17, 2007, Alliance Data entered into an Agreement and
Plan of Merger with Aladdin Holdco and Aladdin Merger Sub, Inc.
Under the terms of the Merger Agreement, Merger Sub will be
merged with and into the company, and as a result, the company
will continue as the surviving corporation and a wholly—owned
subsidiary of Aladdin Holdco. Aladdin Holdco is owned by an
affiliate of The Blackstone Group.
At the effective time of the Merger, each outstanding share of
common stock of the company, other than shares owned by the
company, Aladdin Holdco, any subsidiary of the company or
Aladdin Holdco, or by any stockholders who are entitled to and
who properly exercise appraisal rights under Delaware law, will
be canceled and converted into the right to receive $81.75 in
cash, without interest.
Initially, three putative class actions were filed, which were
later consolidated with the 68th Judicial District Court of
Dallas County, Texas.
On May 18, 2007, Sherryl Halpern filed a putative class action
suit (case no. 07-04689) on behalf of company stockholders in
the 68th Judicial District of Dallas County, Texas against the
company, all of its directors and Blackstone.
On May 29, 2007, Linda Levine filed a putative class action suit
(case no. 07-05009) on behalf of company stockholders in the
192nd Judicial District of Dallas County, Texas against the
company and all of its directors.
On May 31, 2007, the J&V Charitable Remainder Trust filed a
putative class action suit (case no. 07-05127-F) on behalf of
company stockholders in the 116th Judicial District of Dallas
County, Texas against the company, all of its directors and the
Blackstone Group.
The three putative class actions have been consolidated in the
68th Judicial District Court of Dallas County, Texas under the
caption, "In re Alliance Data Corp. Class Action Litigation, No.
07-04689."
On July 16, 2007, a consolidated class action petition was
filed, seeking a declaration that the action was a proper class
action, an order preliminarily and permanently enjoining the
Merger, a declaration that the director defendants breached
their fiduciary duties and an award of fees, expenses and costs.
The company and its directors filed general denials in response
to the putative class actions.
On July 12, 2007, the class plaintiffs filed a motion to enjoin
the scheduled Aug. 8, 2007 special meeting of stockholders at
which stockholders would be asked to vote to adopt the Merger
Agreement.
On July 27, 2007, the company and its directors filed an
opposition brief the motion. The company continued to deny all
of the allegations in the consolidated class action petition,
contended that the asserted claims were baseless and strongly
believed that its disclosures in the Company's definitive proxy
statement filed with the U.S. Securities and Exchange Commission
on July 5, 2007 (Definitive Proxy) were appropriate and adequate
under applicable law.
Nevertheless, in order to lessen the risk of any delay of the
closing of the Merger as a result of the litigation, the company
made available to its stockholders certain additional
information in connection with the Merger, which was filed with
the SEC on July 27, 2007, and subsequently mailed to
stockholders on or about July 28, 2007 (Proxy Supplement).
Class action plaintiffs subsequently withdrew their motions to
enjoin the Aug. 8, 2007 special meeting of stockholders.
On Aug. 14, 2007, the class plaintiffs filed a Second Amended
Petition, in which they withdrew all prior claims but added a
claim for an equitable award of attorney's fees.
They allege that their lawsuits caused the company to issue the
Proxy Supplement, and that the supplement constituted a benefit
to the company, its directors and stockholders for which class
plaintiffs' attorneys should be compensated.
In mid-December 2007, the parties reached a tentative settlement
wherein the company agreed to pay class plaintiffs' counsel
$380,000 as consideration for their contribution to the issuance
of the Proxy Supplement.
The parties are in the process of finalizing a stipulation of
settlement, which must be approved by the Court.
Alliance Data Systems Corp. -- http://www.alliancedata.com/--
is a provider of loyalty and marketing solutions derived from
transaction rich data. ADSC partners with its clients to
develop insight into consumer behavior. It uses that insight to
create and manage customized solutions and enables its clients
to build stronger, mutually beneficial relationships with their
customers. ADSC focuses on facilitating and managing
interactions between its clients and their customers through
multiple distribution channels, including in-store, catalogs and
online. It operates in three business segments: Marketing
Services, Credit Services and Transaction Services.
CABLEVISION SYSTEMS: Court Orders Discovery in Stock Swap Suit
--------------------------------------------------------------
The Delaware Chancery Court ordered that certain discovery take
place and deferred approval of a settlement in a breach of
fiduciary duty lawsuit filed against Cablevision Systems Corp.
in relation to the exchange of the Rainbow Media Group tracking
stock for Cablevision NY Group common stock, according to
Cablevision Systems' May 2008 Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended
March 31, 2008.
Delaware Litigation
In August 2002, purported class action complaints naming as
defendants Cablevision and each of its directors were filed in
the Delaware Chancery Court.
The actions, which allege breach of fiduciary duties and breach
of contract with respect to the exchange of the Rainbow Media
Group tracking stock for Cablevision NY Group common stock, were
purportedly brought on behalf of all holders of publicly traded
shares of Rainbow Media Group tracking stock.
The actions sought to:
-- enjoin the exchange of Rainbow Media Group tracking
stock for Cablevision NY Group common stock,
-- enjoin any sales of Rainbow Media Group assets, or,
in the alternative, award rescissory damages,
-- if the exchange is completed, rescind it or award
rescissory damages,
-- award compensatory damages, and
-- award costs and disbursements.
The suits were consolidated into one action on Sept. 17, 2002,
and in October 2002, Cablevision filed a motion to dismiss the
consolidated action.
The action was stayed by agreement of the parties pending
resolution of a related action brought by one of the plaintiffs
to compel the inspection of certain books and records of
Cablevision.
On Oct. 26, 2004, the parties entered into a stipulation
dismissing the related action and providing for Cablevision's
production of certain documents.
On Dec. 13, 2004, the plaintiffs filed a consolidated amended
complaint, which Cablevision asked the Court to dismiss.
On April 19, 2005, the court granted the company's motion in
part, dismissing the breach of contract claim but upholding the
breach of fiduciary duty claim on the pleadings.
New York Litigation
In August 2003, a purported class action suit naming as
defendants Cablevision, the company's directors and officers,
and certain current and former officers and employees of the
company's Rainbow Media Holdings and American Movie Classics
subsidiaries was filed in the New York Supreme Court by the
Teachers Retirement System of Louisiana.
The suit relates to the August 2002 Rainbow Media Group tracking
stock exchange and allege, among other things, that the exchange
ratio was based upon a price of the Rainbow Media Group tracking
stock that was artificially deflated as a result of the improper
recognition of certain expenses at the national services
division of Rainbow Media Holdings.
The complaint alleges breaches by the individual defendants of
fiduciary duties. It also alleges breaches of contract and
unjust enrichment by Cablevision.
The complaint seeks monetary damages and such other relief as
the court deems just and proper.
On Oct. 31, 2003, Cablevision and the other defendants moved to
stay the action in favor of the previously filed lawsuits
pending in Delaware or, in the alternative, to dismiss for
failure to state a claim.
On June 10, 2004, the court stayed the action on the basis of
the previously filed action in Delaware.
TRSL subsequently filed a motion to vacate the stay in the New
York action, and simultaneously filed a motion to intervene in
the Delaware action and to stay that action. Cablevision
opposed both motions.
On April 19, 2005, the Delaware court in denied the motion to
stay the Delaware action and granted TRSLs motion to intervene
in that action. On June 22, 2005, the court in the New York
action denied TRSL's motion to vacate the stay in that action.
Cablevision reached an agreement in principle with respect to
the settlement of the Delaware action in the quarter ended
June 30, 2007.
In connection with the anticipated settlement, Cablevision
expects to seek dismissal of the New York action as well as the
Delaware action.
A hearing on the proposed settlement took place in April 2008.
At that hearing, the court ordered that certain discovery may
take place and deferred a judgment approving the settlement.
Cablevision Systems Corp. -- http://www.cablevision.com/-- is a
cable operator in the U.S. that operates cable programming
networks, entertainment businesses and telecommunications
companies.
CABLEVISION SYSTEMS: Condition in N.Y. Suit Settlement Not Met
--------------------------------------------------------------
A condition in a stipulation of settlement with regards to
several shareholder suits relating to an October 2006 offer by
the Dolan Family Group to acquire all of the outstanding shares
of Cablevision Systems Corp., has not been meet.
In October 2006, a number of shareholder class action complaints
were filed in New York Supreme Court, Nassau County against
Cablevision and its individual directors relating to the Oct. 8,
2006 offer by the Dolan Family Group to acquire all of the
outstanding shares of Cablevision's common stock, except for the
shares held by the Dolan Family Group.
These lawsuits allege breaches of fiduciary duty and seek
injunctive relief to prevent consummation of the proposed
transaction and compensatory damages.
The trial court ordered expedited discovery, which began in
November 2006.
On Jan. 12, 2007, the Special Transaction Committee of
Cablevision's Board of Directors received a revised proposal
from the Dolan Family Group to acquire all of the outstanding
shares of common stock of Cablevision, except for the shares
held by the Dolan Family Group.
On Jan. 16, 2007, the Special Transaction Committee delivered a
letter to Charles F. Dolan and James L. Dolan, rejecting as
inadequate the revised proposal.
On May 2, 2007, Cablevision entered into a merger agreement
pursuant to which the Dolan Family Group will obtain ownership
of all of the common stock equity of Cablevision.
Lawyers representing shareholders in these lawsuits and in an
action involving claims for alleged options backdating (that is
also pending in the Nassau County Supreme Court) actively
participated in the negotiations, which led to improvements to
the financial terms of the transaction as well as significant
contractual protections for shareholders.
The parties have agreed in principle to the dismissal of the
pending going private litigation, subject to approval of a
settlement by the Nassau County Supreme Court.
Lawyers representing shareholders in certain of the Transactions
Lawsuits, in consultation with lead counsel for the plaintiffs
in the Nassau County Supreme Court options backdating
litigations, participated in the negotiations to improve the
financial terms of the Proposed Merger as well as to add certain
contractual provisions designed to protect the rights of
shareholders.
Based on these events and circumstances, and the role that the
lead counsel for the plaintiffs in the Transactions Lawsuits
played in connection with the Proposed Merger, the parties
subsequently reached a memorandum of understanding for the
dismissal of the Transactions Lawsuits (and of the going-private
claim in the cases pending in the U.S. District Court for the
Eastern District of New York), subject to approval of a
settlement by the Nassau County Supreme Court, and for the
transfer to Cablevision, if the Proposed Merger were to be
consummated, of the options-related derivative claims pending in
the Nassau County Supreme Court and in the U.S. District Court
for the Eastern District of New York.
Pursuant to the memorandum of understanding, the parties
executed a stipulation of settlement as of Sept. 18, 2007.
The stipulation of settlement was conditioned on, among other
things, consummation of the Proposed Merger, and provided that
the stipulation would become null and void and of no further
force and effect in the event that this condition was not
satisfied. This condition was not satisfied, according to the
company's May 2008 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2008.
Cablevision Systems Corp. -- http://www.cablevision.com/-- is a
cable operator in the U.S. that operates cable programming
networks, entertainment businesses and telecommunications
companies.
CABLEVISION SYSTEMS: Faces Antitrust Litigation in California
-------------------------------------------------------------
Cablevision Systems Corp. is facing a purported antitrust class
action suit, entitled, "Rob Brantley et al v. NBC Universal,
Inc. et al., Case No. 2:2007cv06101.," according to the
company's May 2008 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2008.
On Sept. 20, 2007, the antitrust lawsuit was filed with the U.S.
District Court for the Central District of California against
Cablevision and several other defendants, including other cable
and satellite providers and programming content providers.
The complaint alleges that the defendants have violated Section
1 of the Sherman Antitrust Act by agreeing to the sale and
licensing of programming on a "bundled" basis and by offering
programming in packaged tiers rather than on an "a la carte"
basis.
The plaintiffs, purportedly on behalf of a nationwide class of
cable and satellite subscribers, seek unspecified treble
monetary damages and injunctive relief to compel the offering of
channels to subscribers on an "a la carte" basis.
The suit is "Rob Brantley et al v. NBC Universal, Inc. et al.,
Case No. 2:07-cv-06101-CAS-VBK," filed in the U.S. District
Court for the Central District of California, Judge Christina A.
Snyder presiding.
Representing the plaintiffs is:
Maxwell M. Blecher, Esq. (mblecher@blechercollins.com)
Blecher & Collins
515 South Figueroa Street, 17th Floor
Los Angeles, CA 90071
Phone: 213-622-4222
Representing the defendants are:
Arthur J. Burke, Esq. (arthur.burke@dpw.com)
Davis Polk and Wardwell
1600 El Camino Real
Menlo Park, CA 94025
Phone: 650-752-2005
John D. Lombardo, Esq. (john.lombardo@aporter.com)
Arnold and Porter
777 South Figueroa Street, 44th Fl
Los Angeles, CA 90017-2513
Phone: 213-243-4000
- and -
Steven F. Cherry, Esq. (steven.cherry@wilmerhale.com)
Wilmer Cutler Pickering Hale & Dorr
1875 Pennsylvania Avenue NW
Washington, DC 20006
Phone: 202-663-6321
CABLEVISION SYSTEMS: N.Y. Shareholder Lawsuits Remain Stayed
------------------------------------------------------------
Several shareholder lawsuits over stock option grants and stock
appreciation rights filed in New York against Cablevision
Systems Corp. remain stayed.
The company announced on Aug. 8, 2006, that, based on a
voluntary review of its past practices in connection with grants
of stock options and SARs, it has determined that the grant date
and exercise price assigned to a number of its stock option and
SAR grants during the 1997-2002 period did not correspond to the
actual grant date and the fair market value of Cablevision's
common stock on the actual grant date.
The review was conducted with a law firm that was not previously
involved with the company's stock option plans. The company has
advised the U.S. Securities and Exchange Commission and the U.S.
Attorneys Office for the Eastern District of New York of these
matters and each has commenced an investigation.
The company received a grand jury subpoena from the U.S.
Attorneys Office for the Eastern District of New York seeking
documents related to the stock options issues. The U.S.
received a document request from the SEC relating to its
informal investigation into these matters. The company
continues to fully cooperate with such investigations.
In August, September and October 2006, purported derivative
lawsuits, including one purported combined derivative and class
action suit, relating to the company's past stock option and
SARs grants that were brought by parties identifying themselves
as shareholders of Cablevision purporting to act on behalf of
Cablevision.
The suits were filed with:
-- the New York State Supreme Court for Nassau County,
-- the U.S. District Court for the Eastern
District of New York, and
-- the Delaware Chancery Court for New Castle County.
These lawsuits named as defendants certain present and former
members of Cablevision's Board of Directors and certain present
and former executive officers, alleging breaches of fiduciary
duty and unjust enrichment relating to practices with respect to
the dating of stock options, recordation and accounting for
stock options, financial statements and SEC filings, and alleged
violation of Internal Revenue Code 162(m).
In addition, certain of these lawsuits asserted claims under
Sections 10(b), 14(a), and 20(a) of the U.S. Securities Exchange
Act of 1934 and Section 304 of the Sarbanes-Oxley Act.
The lawsuits sought damages from all defendants, disgorgement
from the officer defendants, declaratory relief, and equitable
relief, including rescission of the 2006 Employee Stock Plan and
voiding of the election of the director defendants.
On Oct. 27, 2006, the Board of Directors of Cablevision
appointed Grover C. Brown and Zachary W. Carter as directors
and, on the same date, appointed Messrs. Brown and Carter to a
newly formed special litigation committee of the Board.
The SLC was directed by the Board to review and analyze the
facts and circumstances surrounding these claims, which purport
to have been brought derivatively on behalf of the company, and
to consider and determine whether or not prosecution of such
claims is in the best interests of the company and its
shareholders, and what actions the company should take with
respect to the cases.
The SLC, through its counsel, filed motions in all three courts
to intervene and to stay all proceedings until completion of the
SLCs independent investigation of the claims raised in these
actions.
The Delaware action subsequently was voluntarily dismissed
without prejudice by the plaintiff. The actions pending in
Nassau County have been consolidated and a single amended
complaint has been filed in that jurisdiction.
Similarly, the actions pending in the Eastern District of New
York have been consolidated and a single amended complaint has
been filed in that jurisdiction.
Both the Nassau County action and the Eastern District of New
York action assert derivative claims on behalf of the U.S. as
well as direct claims on behalf of Cablevision shareholders
relating to the company's past stock option and SAR grants.
On Nov. 14, 2006, the trial court in the Nassau County action
denied the SLCs motion for a stay of proceedings and ordered
expedited discovery.
The Appellate Division of the New York State Supreme Court
subsequently stayed all proceedings in the Nassau County action
(including all discovery) pending the SLCs appeal of the denial
of its stay motion.
On Oct. 9, 2007, the Appellate Division affirmed the trial
court's denial of the SLC's motion to stay proceedings. The
U.S. District Court for the Eastern District of New York granted
the SLC's motion for a stay and stayed the cases pending in that
court. That stay expired following the determination that the
transaction contemplated by the Dolan Family Group 2006 Proposal
would not close.
There have been a series of extensions and stays in the Nassau
County and Eastern District actions, and both actions are
currently stayed, according to the company's May 2008 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2008.
Cablevision Systems Corp. -- http://www.cablevision.com/-- is a
cable operator in the U.S. that operates cable programming
networks, entertainment businesses and telecommunications
companies.
CALPINE CORP: Faces Texas Suit Over $9.6-Bln. Sale to NRG Energy
----------------------------------------------------------------
Shareholders sued Calpine Corp. and its directors in the U.S.
District Court for the District Court of Harris County, Texas,
claiming that the defendants are selling Calpine too cheaply to
NRG Energy, for $23 a share, or $9.6 billion, a 6.7% premium
over market price, CourtHouse News Service reports.
This is a shareholder class action suit brought on behalf of all
holders of Calpine common stock who are being and will be harmed
by the defendants' actions.
The plaintiffs want the court to rule on:
(a) whether defendants have breached their fiduciary duties
of undivided loyalty, independence or due care with
respect to plaintiff and the other members of the class
in connection with the merger;
(b) whether the individual defendants are engaging in self-
dealing in connection with the merger;
(c) whether the individual defendants have breached their
fiduciary duty to secure and obtain the best exchange
ratio or price reasonable under the circumstances for
the benefit of plaintiff and the other members of the
class in connection with the merger;
(d) whether defendants have breached any of their other
fiduciary duties to plaintiff and the other members of
the class in connection with the merger, including the
duties of good faith, diligence, honesty and fair
dealing; and
(e) whether plaintiff and the other members of the class
would suffer irreparable injury were the transactions
complained of are consummated.
The plaintiffs ask the court to:
-- declare this action to be a proper class action and
certify named plaintiff Joseph Leone as class
representative and his counsel as class counsel;
-- preliminarily and permanently enjoin the defendants
from disenfranchising the class and effectuating the
merger on current terms;
-- declare that the individual defendants have breached
their fiduciary duty to the plaintiffs;
-- declare the proposed transaction void and order
rescission if consummated;
-- award damages, including rescissory damages, in
favor of the class against all defendants, jointly and
severally, together with interest; and
-- award fees, expenses and costs to the plaintiff and
plaintiff's counsel.
The suit is "Joseph Leone et al. v. Calpine Corp. et al, Case
No. 2008-31781," filed in the U.S. District Court for the
District of Harris County, Texas.
Representing the plaintiffs are:
James H. Powers, Esq.
Joyce B. Margarce, Esq.
Powers & Frost LLP
One Houston Center
1221 McKinney Street, Suite 2400
Houston, TX 770101
Phone: 713-767-1555
Fax: 713-767-1799
CLAYTON HOMES: Continues to Face Lawsuit Over Manufactured Homes
----------------------------------------------------------------
A status hearing was scheduled for May 23 in the class action
suit pending in the circuit court of Miller County, Ark. (Case
No. cv-2005-72-2) against Clayton Homes Inc. and CMH Homes Inc.
over charges for wheels and axles of manufactured homes,
Michelle Massey of the Southeast Texas Record reports.
Texarkana attorney Matt Keil, Esq., of the Keil and Goodson law
firm filed the original class complaint on Feb 17, 2005,
accusing defendants of charging for the manufactured homes'
wheels and axles but never disclosing the charge to the
purchaser.
Ms. Massey recounts that the charge for the wheels and axles
"appears nowhere on any of the documents the plaintiffs are
asked to sign during the purchase of the home."
Furthermore, the defendants were accused of then taking the
wheels and axles and reselling them to an outside company and
retaining the profits of the sales.
The lawsuit is seeking a total of $2,200 for each class member,
$1,200 for the wheels and axles that they were unknowingly
charged and $1,000 for the resale value.
In April, the case was stayed for mediation to be conducted
under retired Judge Layn Phillips. If the parties are unable to
resolve the case during mediation, Circuit Court Judge Jim
Hudson has ordered the defendants to respond to the plaintiffs'
numerous discovery requests.
The defendants believe that the plaintiffs cannot prevail on
their claims because evidence shows the plaintiffs agreed to
purchase a manufactured home, not wheels and axles, the report
states.
Clayton Homes -- http://www.clayton.net/-- and its subsidiaries
make up a vertically integrated manufactured housing company
with 32 manufacturing plants, 392 company-owned stores, more
than 1,400 independent retailers, 83 manufactured housing
communities and subdivisions, and financial services operations
that provide mortgage services for more than 400,000 customers
and insurance protection for 135,000 families.
CUMULUS MEDIA: Settles Cloud Merger Lawsuit; Still Faces Others
---------------------------------------------------------------
Cumulus Media, Inc., settled one of three purported class action
suits over a merger agreement with Cloud Acquisition Corp. and
its subsidiary Cloud Merger Corp., according to the company's
May 2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2008.
On July 23, 2007, Cumulus Media entered into an Agreement and
Plan of Merger with Cloud Acquisition and subsidiary Cloud
Merger (Merger Sub).
Under the terms of the Merger Agreement, Merger Sub will be
merged with and into Cumulus Media, with Cumulus continuing as
the surviving corporation and a wholly owned subsidiary of Cloud
Acquisition.
Lawsuits
The three purported class action suits related to the merger
are:
1. "Jeff Michelson, on behalf of himself and all others
similarly situated v. Cumulus Media Inc., et al."
(Case No. 2007CV137612, filed July 27, 2007), which
was filed in the Superior Court of Fulton County,
Georgia against the company, Lew Dickey, the other
directors and the sponsor;
2. "Patricia D. Merna, on behalf of herself and all
others similarly situated v. Cumulus Media Inc., et
al." (Case No. 3151, filed August 8, 2007), which was
filed in the Chancery Court for the State of
Delaware, New Castle County, against the company, Lew
Dickey, the other directors, the sponsor, Cloud
Acquisition and Merger Sub; and
3. "Paul Cowles v. Cumulus Media Inc., et al." (Case No.
2007-CV-139323, filed August 31, 2007), which was
filed before the Superior Court of Fulton County,
Georgia against the company, Lew Dickey, the other
directors and the sponsor.
The complaints in each of these lawsuits allege, among other
things, that the merger is the product of an unfair process,
that the consideration to be paid to the company's stockholders
pursuant to the merger is inadequate, and that the defendants
breached their fiduciary duties to the company's stockholders.
The complaints further allege that the company and the sponsor
(and Cloud Acquisition and Merger Sub) aided and abetted the
actions of the company's directors in breaching such fiduciary
duties. The complaints seek, among other relief, an injunction
preventing completion of the merger.
Partial Settlement
In order to resolve one of the lawsuits, the company has reached
an agreement along with the individual defendants in that
lawsuit, without admitting any wrongdoing, pursuant to a
memorandum of understanding dated Nov. 13, 2007, to extend the
statutory period in which holders of the company's common stock
may exercise their appraisal rights and to make certain further
disclosures in the proxy statement filed in connection with the
merger as requested by counsel for the plaintiff in that
litigation.
The parties have completed confirmatory discovery and anticipate
that they will cooperate in seeking dismissal of the lawsuit.
Such dismissal, including an anticipated request by plaintiff's
counsel for attorneys' fees, will be subject to court approval.
The company intends to vigorously defend the remaining two
lawsuits.
Cumulus Media Inc. -- http://www.cumulus.com-- owns and
operates frequency modulation (FM) and audio modulation (AM)
radio station clusters serving mid-sized markets throughout the
U.S. Through its investment in Cumulus Media Partners, LLC
(CMP), the Company also operates radio station clusters serving
large-sized markets throughout the U.S. As of Dec. 31, 2007,
Cumulus owned and operated 303 radio stations in 56 mid-sized
U.S. media markets and operated the 33 radio stations in eight
markets, including San Francisco, Dallas, Houston and Atlanta
that are owned by CMP. Under an local marketing agreement
(LMA), the Company provides sales and marketing services for one
radio station in the United States in exchange for a management
or consulting fee. In summary, Cumulus owns and operates,
directly or through its investment in CMP, a total of 336
stations in 64 U.S. markets.
DAM OWNERS: Birchwood Lakes Agrees to Settle Rancocas Creek Suit
----------------------------------------------------------------
Medford dam owner Birchwood Lakes Colony Club has agreed to pay
$200,000 to settle its portion of an ongoing class-action
lawsuit brought by victims of the 2004 floods in the Rancocas
Creek watershed, Danielle Camilli writes for Burlington County
Times.
According to the report, a judge must hold a fairness hearing
and approve the Birchwood Lakes settlement before it is
finalized. The hearing has not yet been scheduled.
Case Background
Burlington Times recounts that a series of dam failures during a
torrential rainstorm on July 12-13, 2004, led to flooding that
caused about $25 million in property damage in the Rancocas
Creek watershed.
The suit, which includes more than 200 property owners who
suffered flood damage, contends that the dams were not properly
maintained by their owners.
The report relates that Birchwood Lakes is the latest dam owner
to settle its part of the lawsuit. To date, about 20 defendants
have settled the claims for about $6.7 million in aggregate.
Edward Petkevis, Esq., who represents the class, said that
mediation is scheduled next month for the remaining two
defendants -- the YMCA Camp Ockanickon in Medford and the Girl
Scouts of Camden County, which has a camp with lakes in
Tabernacle. Dams owned by YMCA Camp Ockanickon and the Girl
Scouts of Camden County were the first to fail as a result of
the storm, and the class is seeking the largest settlements from
these owners, Mr. Petkevis said.
If settlements can not be reached with the YMCA and the Girl
Scouts, the cases would go to trial.
Currently, the highest settlement accepted by the class was
$2.5 million from the towns of Medford and the Evesham Municipal
Utilities Authority.
As reported in the Class Action Reporter on Oct. 10, 2007, other
defendants in the suit include Lost Lake Colony Club; the
Marlton Lakes Civic Association, which owns Crane Lake Dam in
Evesham; three estates that own other dams; Bowman Contractors
of West Berlin and Pine Acres Associates, which owns Kenilworth
dams in Evesham.
Settlement money will be divided among the members of the class
once the two remaining claims are settled through agreements or
by trial, Burlington Times says.
For more information, contact:
Edward Petkevis, Esq.
1380 Hornberger Ave.
Roebling, N.J. 08554-1309
DRUGSTORE.COM INC: Faces FCRA Violations Lawsuit in Washington
--------------------------------------------------------------
Drugstore.com, Inc., is facing a purported class action suit
alleging breach of a provision of the Fair Credit Reporting Act
related to the printing of credit card receipts.
The suit was filed by Aaron Burgess and John James Garland
before the U.S. District Court for the Western District of
Washington on Feb. 26, 2008. It seeks statutory and punitive
damages.
The company was served with the complaint on March 7, 2008, and
filed its answer the following month, according to the company's
May 2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 30, 2008.
The suit is "Burgess et al v. Drugstore.com Inc et al., Case No.
2:08-cv-00335-RSMm" filed in the U.S. District Court for the
Western District of Washington, Judge Ricardo S. Martinez
presiding.
Representing the plaintiffs are:
Stephen P. Connor, Esq. (steve@cslawfirm.net)
Connor & Sargent PLLC
1200 Fifth Avenue
Suite 1650
Seattle, WA 98101
Phone: 206-654-5050
Fax: 206-624-5469
Charles L. Holliday, Esq. (holliday@spraginslaw.com)
Spragins Barnett & Cobb
312 East Lafayette Street
Jackson, TN 38301
Phone: 731-424-0461
- and -
James Brandon Mcwherter, Esq.
(bmcwherter@gilbertfirm.com)
Gilbert Russell Mcwherter PLC
101 North Highland Avenue
Jackson, TN 38301
Phone: 731-664-1340
Representing the defendant is:
Mark A. Wilner, Esq. (mwilner@gordontilden.com)
Gordon Tilden Thomas & Cordell LLP
1001 4th Ave.
Ste. 4000
Seattle, WA 98154
Phone: 206-467-6477
Fax: 206-467-6292
GOLD FIELDS: Continues to Face Suits in Okla. Over Lead Exposure
----------------------------------------------------------------
Gold Fields Mining, LLC, a subsidiary of Peabody Energy Corp.,
and two other companies continue to face two class action
lawsuits that were brought on behalf of people allegedly exposed
to lead in connection with past operations near Picher,
Oklahoma.
The plaintiffs have asserted claims predicated on allegations of
intentional lead exposure by the defendants and are seeking
compensatory damages, punitive damages and the implementation of
medical monitoring and relocation programs for the affected
individuals.
The lawsuits are pending with the U.S. District Court for the
Northern District of Oklahoma.
Golf Fields reported no development in the case in its May 2008
Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended March 31, 2008.
Peabody Energy Corp. -- http://www.peabodyenergy.com/-- is a
coal company. It sells coal to over 340 electricity generating
and industrial plants in 19 countries. The Company owns
majority interests in 31 coal operations located throughout all
the United States coal producing regions and in Australia. In
addition, it owns a minority interest in one Venezuelan mine,
through a joint venture arrangement. Most of the production in
the western U.S. is low-sulfur coal from the Powder River Basin.
Peabody owns and operates six mines in Queensland, Australia,
and five mines in New South Wales, Australia.
HANARO TELECOM: Continues to Face Suit Over Information Leak
------------------------------------------------------------
Thousands of former and current subscribers of South Korean
broadband and fixed-line operator Hanarotelecom (KSE:033630)
filed a class-action lawsuit against the company for allegedly
selling their confidential information to telemarketers,
Telecoms Korea reports.
Yoo Chul-min, an attorney in Seoul who has been gathering
alleged victims of the information leak through an Internet
community, lodged the lawsuit with the Seoul Central District
Court on behalf of 3,000 former and current users who had
subscribed to the company's service for at least a month between
2006 and the end of April 2008.
Mr. Yoo requested that the company offer compensation of $955 to
each client for illegally selling their private information,
including resident registration and mobile phone numbers.
Mr. Yoo also expressed his intention to launch additional class
action suits, claiming to have collected some 6,000 former users
that have expressed their wish to join in the legal battle.
Last month, Namkang Law & IP Firm, the Seoul-based law firm
filed a similar lawsuit with the Seoul Central District Court,
requesting that the company offer compensation of KRW1 million
(US$1,004) to each client for illegally selling their
information (Class Action Reporter, May 2, 2008).
The report also recalled that in April, the police revealed that
several former managers, including Hanarotelecom's former
president, allegedly sold the private information, including
resident registration and phone numbers, of some 6 million users
to telemarketing companies over the past two years.
Listed on the Korea Composite Stock Price Index, Hanaro is South
Korea's second largest fixed-line telecommunications operator.
It has a market share of approximately 24.9% (equating to 3.7
million subscribers) for broadband and 8.8%, or 2.0 million
subscribers, for telephony based services (source: Ministry of
Information and Communication). In addition, Hanaro offers a
wide range of services including multimedia data, internet data
centre services and, more recently has launched hanaTV, an on-
demand TV service. Hanaro also provides leased or dedicated
lines and IDC services to corporate clients.
INDIANA FSSA: Residents Sue Over Medicaid Termination/Denial
------------------------------------------------------------
Several Madison County residents have filed a class-action
lawsuit in Marion County against the Indiana Family and Social
Services Administration, Jason M. White writes for Anderson
Herald Bulletin.
According to the report, more than 20 people are listed as
plaintiffs in the lawsuit, which criticizes the FSSA for
terminating or denying Medicaid and food stamp assistance for
people, many of whom are disabled, based on minor
technicalities.
"The system is broken," Denny Lanane, leader of Madison County
Triad, told Anderson Herald. Mr. Lanane, who has attended many
meetings about FSSA concerns across central Indiana, said he was
familiar with the problems people face.
For instance, Mr. Lanane said he knows a Bloomington woman who
drove to Madison County to help her partially deaf mother speak
with FSSA representatives over the phone. Her mother was a
senior citizen who also had memory problems, Mr. Lanane said.
FSSA representatives asked for personal information over the
speaker phone, and the senior citizen's daughter helped provide
the answers.
The daughter was criticized by FSSA representatives and told she
could not participate in the interview. The representative told
her the interview was suspended because she helped, and her
mother was denied coverage, Mr. Lanane said.
According to the lawsuit, the FSSA can terminate or deny
assistance to individuals who fail to cooperate with verifying
their information, such as residency, income and eligibility.
But no leeway is given to people with disabilities who may have
trouble and need help cooperating with the FSSA, Mr. Lanane
added to Anderson Herald.
Anderson Herald says the FSSA could not be reached for comment
as of press time.
INSPIRE PHARMACEUTICALS: Nixing of N.C. Securities Suit Appealed
----------------------------------------------------------------
The plaintiffs in a consolidated class action lawsuit against
Inspire Pharmaceuticals, Inc., are appealing to the U.S. Court
of Appeals for the Fourth Circuit the dismissal of their case
earlier by the U.S. District Court for the Middle District of
North Carolina, according to Inspire Pharma's May 9, 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended March 31, 2008.
On Feb. 15, 2005, the first of five identical purported
shareholder class action complaints was filed against the
company and certain of its senior officers.
Each complaint alleged violations of sections 10(b) and 20(a) of
the U.S. Securities Exchange Act of 1934, and Securities and
Exchange Commission Rule 10b-5, and focused on statements that
are claimed to be false and misleading regarding a Phase 3
clinical trial of the company's dry eye product candidate,
ProlacriaTM (diquafosol tetrasodium).
Each complaint sought unspecified damages on behalf of a
purported class of purchasers of the company's securities
between June 2, 2004, and Feb. 8, 2005.
On March 27, 2006, following a consolidation of the lawsuits
into a single civil action and the appointment of lead
plaintiffs, a consolidated class action complaint asserting the
same allegations as the original ones was filed.
The complaint also asserts claims against certain parties that
served as underwriters in the company's securities offerings
during the period relevant to the complaint.
The consolidated complaint seeks unspecified damages on behalf
of a purported class of purchasers of the company's securities
from May 10, 2004, to Feb. 8, 2005.
In May 2006, the plaintiffs agreed to voluntarily dismiss their
claims against the underwriters on the basis that they were
time-barred.
On June 30, 2006, the company and other defendants asked the
court to dismiss the complaint on the grounds that it fails to
state a claim upon which relief can be granted and does not
satisfy the pleading requirements under applicable law.
On July 26, 2007, the court granted Inspire's and the other
defendants' request and dismissed the consolidated action with
prejudice.
On Aug. 24, 2007, the plaintiffs filed an appeal to the U.S.
Court of Appeals for the Fourth Circuit.
The plaintiffs filed their opening appellate brief in November
2007. The company and the other defendants filed an opposition
brief earlier this year, followed by the plaintiffs' reply.
The company reported no further development in the matter in its
regulatory SEC disclosure.
The suit is "Mirco Investors, LLC v. Inspire Pharma, et al.,
Case No. 1:05-cv-00118-WLO," filed before the U.S. District
Court for the Middle District of North Carolina, Judge William
L. Osteen, presiding.
Representing the plaintiffs are:
Leslie Bruce Mcdaniel, Esq.
Mcdaniel & Anderson, L.L.P.
P.O. Box 58186
Raleigh, NC 27658-8186
Phone: 919-872-3000
Fax: 919-790-9273
e-mail: mcdas@mcdas.com
- and –
Kristi Stahnke Mcgregor, Esq.
(kmcgregor@milbergweiss.com)
Milberg Weiss Bershad & Schulman, LLP
5200 Town Ctr. Cir., Ste. 600
Boca Raton, FL 33486
Phone: 561-361-5022
Fax: 561-367-8400
Representing the defendants are:
William Mark Conger, Esq.
(mconger@kilpatrickstockton.com)
Kilpatrick Stockton, L.L.P.
1001 W. Fourth St.
Winston-Salem, NC 27101
Phone: 336-607-7309
Fax: 336-734-2633
- and -
Barry m. Kaplan, Esq.
Wilson Sonsini Goodrich & Rosati
701 Fifth Ave., Ste. 5100
Seattle, WA 98104
Phone: 206-883-2500
Fax: 206-883-2699
ISTAR FINANCIAL: Faces Securities Fraud Litigation in New York
--------------------------------------------------------------
iStar Financial Inc. is facing two purported securities fraud
class action suits filed in the U.S. District Court for the
Southern District of New York, making substantially similar
claims, according to the company's May 2008 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2008.
Citiline Litigation
On April 14, 2008, Citiline Holdings, Inc., filed suit on behalf
of purchasers of common stock in iStar's Dec. 13, 2007 public
offering.
The complaint names the company and certain of its current
executive officers as defendants. It alleges violations of the
U.S. Securities Act of 1933, as amended, in connection with the
December 2007 public offering.
The plaintiff seeks compensatory damages plus interest and
attorneys fees and rescission of the public offering.
Christenson Litigation
On April 24, 2008, Dennis Christenson filed suit on behalf of
purchasers of the company's common stock on its Dec. 13, 2007
public offering.
The complaint names the company and certain of its current
executive officers as defendants. It alleges violations of the
Securities Act of 1933, as amended, in connection with the
December 2007 public offering.
The plaintiff seeks compensatory damages plus interest and
attorneys fees and rescission of the public offering.
iStar Financial, Inc. -- http://www.istarfinancial.com/-- is a
finance company focused on the commercial real estate industry.
The Company provides custom-tailored financing to private and
corporate owners of real estate, including senior and mezzanine
real estate debt, senior and mezzanine corporate capital,
corporate net lease financing and equity. cIt has two primary
lines of business: lending and corporate tenant leasing. Its
primary sources of revenues are interest income, which is the
interest that borrowers pay on loans, and operating lease
income, which is the rent that corporate customers pay to lease
corporate tenant lease properties. The lending business
primarily consists of senior and mezzanine real estate loans
that range in size from $20 million to $150 million, and have
maturities ranging from 3 to 10 years. The Company's corporate
tenant leasing business provides capital to corporations and
others who control facilities leased primarily to single credit-
worthy customers.
JUNIPER NETWORKS: Calif. Court Dismisses Certain Claims in Suit
---------------------------------------------------------------
The U.S. District Court for the Northern District of California
issued an order granting in part and denying in part Juniper
Networks, Inc.'s motion to dismiss a securities fraud class
action filed against it, according to the company's May 9, 2008
Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2008.
On July 14, 2006, a purported class-action complaint captioned,
"Garber v. Juniper Networks, Inc., et al., No. C-06-4327 MJJ,"
was filed in the U.S. District Court for the Northern District
of California against the company and certain of its officers
and directors. The plaintiff filed a corrected complaint on
July 28, 2006.
The Garber class action is brought on behalf of all purchasers
of Juniper Networks' common stock between Sept. 1, 2003, and
May 22, 2006.
On Aug. 29, 2006, another purported class-action complaint
captioned, "Peters v. Juniper Networks, Inc., et al., No. C 06
5303 JW," was filed in the U.S. District Court for the Northern
District of California against the company and certain of its
officers and directors.
The Peters class action is brought on behalf of all purchasers
of Juniper Networks' common stock between April 10, 2003, and
Aug. 10, 2006.
Both purported class action lawsuits allege that the company and
certain of its officers and directors violated federal
securities laws by manipulating stock option grant dates to
coincide with low stock prices and issuing false and misleading
statements including, among others, incorrect financial
statements due to the improper accounting of stock option
grants.
Both suits were later consolidated. On Nov. 20, 2006, the court
appointed the New York City Pension Funds as lead plaintiff, who
filed a consolidated class action complaint in January 2007.
The consolidated complaint asserts claims on behalf of all
purchasers of, or those who otherwise acquired, Juniper
Networks' publicly traded securities from April 10, 2003,
through and including Aug. 20, 2006. It alleges violations of
the U.S. Securities Act of 1933 and the U.S. Securities Exchange
Act of 1934 by the company and certain of its current and former
officers and directors.
In February 2007, the parties agreed in a court-approved
stipulation that the plaintiffs may file an amended consolidated
complaint within 30 days after the company files its restated
financial statements with the U.S. Securities Exchange
Commission.
On June 7, 2007, the defendants filed a motion to dismiss
certain of the claims, and a hearing was held on Sept. 10, 2007.
On March 31, 2008, the Court issued an order granting in part
and denying in part the defendants' dismissal motion. The Court
dismissed with prejudice the plaintiffs' section 10(b) claim to
the extent it was based on challenged statements made before
July 14, 2001. The order also dismissed, with leave to amend,
the plaintiffs' section 10(b) claim against Pradeep Sindhu.
All of the plaintiffs' other claims were upheld. The order gave
the plaintiffs until May 1, 2008, to file an amended complaint,
but they chose not to amend their complaint. The defendants'
deadline for responding to the operative complaint is June 16,
2008.
The suit is "In Re: Juniper Securities Litigation, Case No.
5:06-cv-04327-JW," filed in the U.S. District Court for the
Northern District of California, Judge James Ware presiding.
Representing the plaintiffs are:
Richard Bemporad, Esq. (rbemporad@ldbs.com)
Lowey Dannenberg Bemporad Selinger & Cohen, P.C.
White Plains Plaza
1 North Broadway, 5th Floor
White Plains, NY 10601-2310
Phone: 914-997-0500
- and -
William M. Audet, Esq. (waudet@audetlaw.com)
Audet & Partners
221 Main Street, Suite 1460
San Francisco, CA 94105
Phone: 415-982-1776
Fax: 415-576-1776
Representing the defendants is:
Joni L. Ostler, Esq. (jostler@wsgr.com)
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304
Phone: 650-493-9300
Fax: 650-565-5100
KEYSTONE AUTOMOTIVE: Calif. Court Gives Final Okay to Settlement
----------------------------------------------------------------
The Superior Court of the State of California, County of Los
Angeles, gave final approval to a proposed settlement for two
purported class action suits against Keystone Automotive
Industries, Inc., over its merger agreement with LKQ Corp.
On July 16, 2007, the company entered into an Agreement and Plan
of Merger with LKQ Corp., a Delaware corporation; LKQ
Acquisition Company, a California corporation; and a wholly
owned subsidiary of LKQ Corp., wherein LKQ Corp. agreed to
acquire Keystone Automotive.
The merger agreement is subject to shareholder and regulatory
approval. The merger was expected to close in the fourth
quarter of calendar 2007.
On July 18, 2007, two putative class action complaints were
filed against Keystone and its directors in the Superior Court
of the State of California, County of Los Angeles, in connection
with the proposed merger. The suits are:
1. "Lynch v. Keystone Automotive Industries, Inc., Case
No. BC374399," and
2. "Shoys v. Keystone Automotive Industries, Inc., Case
No. BC374480."
The lawsuits purport to represent a class of all holders of the
company's common stock, allege self-dealing and breach of
fiduciary duty and challenge the adequacy of the process
employed by the company and the share price to be paid to the
company's stockholders in the merger. They seek to enjoin the
proposed merger and request payment of attorneys' fees.
On Sept. 17, 2007, Keystone entered into a conditional
memorandum of understanding with the plaintiffs' counsel and the
other named defendants in the actions pursuant to which the
parties agreed to settle the actions, subject to certain
conditions, including confirmatory discovery and court approval
of the final settlement.
On April 28, 2008, the court approved the settlement, which was
covered by insurance, other than the company's costs for the
$250,000 deductible and approximately $100,000 in fees and
expenses, according to LKQ Corp.'s May 2008 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2008.
Keystone Automotive Industries, Inc. -- http://www.keystone-
auto.com/ -- is a distributor of aftermarket collision
replacement parts produced by independent manufacturers for
automobiles and light trucks. Keystone distributes products
primarily to collision repair shops throughout most of the
United States and certain areas in Canada. It also recycles and
produces chrome plated and plastic bumper, and remanufactures
alloy and steel wheels. The Company's principal product lines
consist of automotive body parts, bumpers and remanufactured
alloy wheels, light truck accessories, as well as paint and
other materials used in repairing a damaged vehicle.
KOSA LTD: Settles Antitrust Suit in North Carolina for $33 Mln.
---------------------------------------------------------------
KoSa Ltd., now known as Invista, has reached a proposed
$33-million settlement with plaintiffs in a six-year-old
antitrust lawsuit, John Downey of the Charlotte Business Journal
reports.
Filed in 2002, the consumer class action suit was filed on
behalf of all individuals who purchased Polyester Staple in the
United States directly from defendants:
(1) DuPont de Nemours and Company,
(2) DAK Americas LLC,
(3) Dak Fibers LLC,
(4) Alpek S. A. de C.V.,
(5) Nan Ya Plastics Corporation, America a/k/a Nan Ya
Plastics Corporation USA,
(6) Wellman, Inc.,
(7) Arteva Specialties, S.a.r.l. d/b/a KoSa,
(8) Arteva Specialties LLC,
(9) Arteva Service S.a.r.l.,
(10) Koch Industries, Inc.
(11) IMASAB S.A. de C.V.
The lawsuit alleged that the defendants conspired to fix prices
of Polyester Staple sold in the United States and to allocate
markers or customers, in violation of antitrust laws (Class
Action Reporter, Nov. 14, 2003).
KoSa, which has its regional headquarters in Charlotte, admits
no wrongdoing in the settlement.
When the lawsuits started, KoSa had a major manufacturing plant
in Salisbury, employing 800 workers. Invista, a division of
Koch Industries Inc., sold that plant in March.
Judge Richard Voorhees of the U.S. District Court for the
Western District of North Carolina has given preliminary
approval to the settlement and will hold a June 24, 2008 hearing
in Charlotte.
MERALCO (PHILS.): NGOs Threaten Anew to Sue Over Power Rates
------------------------------------------------------------
Several non-government organizations again vowed to file a class
action suit against the Manila Electric Co. -- which is owned
and controlled by the Lopez family -- over the company's
allegedly onerous power rates, Kristine L. Alave writes for the
Philippine Daily Inquirer.
PDI says that in a press conference in Mandaluyong City,
representatives of around 30 NGOs -- including the Volunteers
Against Crime and Corruption; Philippine Federation of Electric
Cooperative; Luntiang Pangarap; and Bantay Bayan Foundation Inc.
-- demanded quick respite against what they deemed "unjustly
imposed and oppressively collected electric rates" under guises
such as "system loss," generation charges, transmission charges,
metering charges and universal charges.
According to the report, the groups, under the umbrella
organization Refund Energy Fees Unjustly Debited (REFUND
Movement), said it will file a class suit against Meralco before
the Energy Regulatory Commission within a fortnight to
accommodate other organizations that have indicated their
intention to join the case.
In a manifesto read at the news conference, REFUND members urged
a full accounting of Meralco's charges and an immediate refund
of the "unjust" charges. In particular, the group demanded a
full accounting of money collected by Meralco under "system
loss" and various other charges, the immediate issuance by the
ERC of an order ending the collection of "system loss" and other
unjust charges, and a full and speedy refund of the payments
made by customers for such charges.
REFUND hit the alleged preferential treatment Meralco gives to
other Lopez-owned companies and the company's reported practice
of passing on its losses and office expenses to the consumers.
In an earlier Senate hearing, PDI notes, Meralco executives
admitted that the company passed on to the public its own
electricity bills amounting to PHP427.5 million per year. The
company said it was part of the system loss that Meralco was
allowed to charge and is supported by law.
"Just for the first quarter of 2008, Meralco gained a net profit
of PHP655 million. Yet, Meralco makes all their consuming
public pay for Meralco offices' unlimited consumption of
electricity amounting to hundreds of millions of pesos. Meralco
keeps the profits and makes us pay for its losses. What could
be more outrageous than this?" REFUND said.
Aside from Meralco, government agencies involved in power also
earned the ire of the group, the report relates.
REFUND Movement hit the debt-laden National Power Corp. for its
"continued inefficiency and dubious loans and contracts," which
the public shoulders, and demanded that it, too, be
investigated.
The group also slammed the Energy Regulatory Commission, saying
it failed to protect consumers from Meralco's dubious rates and
promote market competition as mandated by the Electric and Power
Industry Reform Act.
The group opposed a government takeover of Meralco, according to
PDI. The key for a well-governed Meralco, REFUND Movement said,
was to have significant consumer representation in the country's
largest electricity distributor.
Dante Jimenez, VACC chairman, said REFUND will not only file a
civil case against the company, it will also file a criminal
charge of large-scale estafa against Meralco for allegedly
overcharging consumers and for the slow release of the
PHP30-billion refund ordered by the Supreme Court in a previous
case.
Aside from these two legal remedies, Mr. Jimenez said REFUND
Movement is eying the possibility of urging the public not to
pay their Meralco bills, considering that the company has yet to
complete its PHP30-billion refund.
"They should stop fooling the people. This is the start of
something that will unite the people, especially in Metro
Manila," Mr. Jimenez said.
After Meralco, REFUND Movement said it will focus on running
after electricity distributors in the provinces who overcharge
their clients as well, Mr. Jimenez said.
PDI INC: Faces Suits Arising From Use of Baycol Medication
----------------------------------------------------------
PDI, Inc., is facing two purported class action lawsuits
alleging claims arising from the use of Baycol, a prescription
cholesterol-lowering medication.
Baycol was distributed, promoted and sold by Bayer in the U.S.
until early August 2001, at which time Bayer Corp. voluntarily
withdrew Baycol from the U.S. market.
Bayer had retained certain companies, such as PDI, to provide
detailing services on its behalf pursuant to contract sales
force agreements.
To date, the company has defended these actions vigorously and
have asserted a contractual right of defense and indemnification
against Bayer for all costs and expenses the company incur
relating to these proceedings.
In February 2003, the company entered into a joint defense and
indemnification agreement with Bayer, pursuant to which Bayer
has agreed to assume substantially all of the company's defense
costs in pending and prospective proceedings and to indemnify
the company in these lawsuits, subject to certain limited
exceptions.
Furthermore, Bayer agreed to reimburse the company for all
reasonable costs and expenses incurred through such date in
defending these proceedings.
As of Dec. 31, 2007, Bayer has reimbursed the company for
approximately $1.6 million in legal expenses, the majority of
which was received in 2003 and was reflected as a credit within
selling, general and administrative expense.
The company did not incur any costs or expenses relating to
these matters during 2005, 2006, 2007 or the first three months
of 2008.
The company reported no development in the matter in its May
2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended March 31, 2008.
PDI Inc. -- http://www.pdi-inc.com/-- is a provider of contract
sales teams to pharmaceutical companies, offering a range of
sales support services. In addition to contract sales teams,
the Company also provides marketing research, physician
interaction and medical education programs. The services offer
customers a range of promotional and educational options for the
commercialization of their products throughout their lifecycles,
from development through maturity. The three segments of the
Company are Sales Services, Marketing Services and PDI Products
Group.
PHARMANET DEVELOPMENT: Final OK for $28.5MM Settlement Appealed
---------------------------------------------------------------
Certain parties in the securities fraud class action captioned
"Michael et al. v. SFBC International, Inc., Case No. 2:06-cv-
00165-SRC-CCC," which named PharmaNet Development Group Inc. --
formerly SFBC International, Inc. -- as a defendant, are
appealing the court's final approval of a $28.5-million
settlement that should have resolved the matter.
Beginning in late December 2005, a number of class action
complaints have been filed before the U.S. District Court for
the Southern District of Florida and the U.S. District Court for
the District of New Jersey alleging that SFBC and certain of its
current and former officers and directors violated Sections
10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, and
Rule 10b-5 thereunder.
The company was served notice of these lawsuits in early January
2006. The suits allege that the defendants misrepresented the
company's business conditions, prospects and financial results
and failed to disclose the company's allegedly improper and
reckless business practices, such as improper recruiting
practices and mismanagement of clinical trials.
They purport to have been brought by one of two proposed
classes: those who purchased the company's common stock from
Aug. 4, 2003, through Dec. 15, 2005, or from Feb. 17, 2004,
through Dec. 15, 2005.
On June 21, 2006, the Judicial Panel for Multidistrict
Litigation transferred all of the Federal Securities Actions for
pre-trial proceedings to the District of New Jersey, where they
were later consolidated.
On Nov. 1, 2006, the Arkansas Teachers' Retirement System, the
lead plaintiff in the case, filed a consolidated amended class
action complaint.
The Amended Complaint alleges that the company and several of
its current and former officers and directors violated Sections
11, 12 (a)(2) and 15 of the U.S. Securities Act of 1933, as well
as Sections 10(b) and 20(a) of the U.S. Securities Exchange Act
of 1934. It claims violations of these federal securities laws
through misstatements or omissions regarding:
-- the maximum occupancy at the company's Miami
facility;
-- the Miami facility's purportedly dangerous and unsafe
structure;
-- the company's clinical practices;
-- purported conflicts of interests involving
Independent Review Boards used by the company; and
-- related-party transactions and some former
executives' qualifications.
On Aug. 1, 2007, the company issued a press release announcing
that it had entered into an agreement to settle the suit.
Pursuant to the terms of the Settlement Agreement, the class
will receive approximately $28.5 million (less legal fees,
administration and other costs).
The Settlement Agreement received preliminarily court approval.
On March 10, 2008, the Court formally approved the Settlement
Agreement and entered Final Judgment.
On April 9, 2008, a Notice of Appeal of the Final Judgment was
filed, according to the company's May 2008 Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2008.
The suit is "Michael et al. v. SFBC International, Inc., Case
No. 2:06-cv-00165-SRC-CCC," filed before the U.S. District Court
for the District of New Jersey, Judge Stanley R. Chesler,
presiding.
Representing the plaintiffs is:
Joseph J. DePalma, Esq. (jdepalma@ldgrlaw.com)
Lite, DePalma, Greenberg & Rivas, LLC
Two Gateway Center, 12th Floor
Newark, NJ 07102-5003
Phone: 973-623-3000
Representing the defendants are:
Patrick Charles English, Esq.
Dines & English, LLC
685 Van Houten Avenue
Clifton, NJ 07013
Phone: 973-778-7575
e-mail: dinesandenglish@aol.com
- and -
Stephen Patrick Warren, Esq.
(stephen.warren@hklaw.com)
Holland & Knight, LLP
701 Brickell Avenue, Suite 3000
Miami, FL 33131
Phone: 305-374-8500
RAIT FINANCIAL: Seeks Dismissal of Pa. Securities Fraud Lawsuit
---------------------------------------------------------------
RAIT Financial Trust is seeking the dismissal of a consolidated
securities fraud class action suit filed in the U.S. District
Court for the Eastern District of Pennsylvania, according to the
company's May 9, 2008 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2008.
The company, certain of its executive officers and trustees and
the lead underwriters involved in the company's public offering
of common shares in January 2007 were named defendants in one or
more of nine putative class actions filed in August and
September 2007 with the U.S. District Court for the Eastern
District of Pennsylvania.
By Order dated Nov. 17, 2007, the court consolidated these cases
under the caption, "In re RAIT Financial Trust Securities
Litigation, Case No. 2:07-cv-03148," and appointed a lead
plaintiff and lead counsel.
On Jan. 4, 2008, the lead plaintiff filed a consolidated class
action complaint on behalf of a putative class of purchasers of
our securities between June 8, 2006, and August 3, 2007.
The complaint names as defendants RAIT, 11 current and former
officers and trustees of RAIT, 10 underwriters who participated
in certain of the company's securities offerings in 2007, and
the company's independent accounting firm.
The complaint alleges, among other things, that certain
defendants violated Sections 11, 12(a)(2) and 15 of the
Securities Act of 1933 by making materially false and misleading
statements and material omissions in registration statements and
prospectuses about our credit underwriting, the company's
exposure to certain issuers through investments in debt
securities, and the company's loan loss reserves and other
financial items.
The complaint further alleges that certain defendants violated
Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of
1934, and Rule 10b-5 thereunder, by making materially false and
misleading statements and material omissions during the putative
class period about our credit underwriting, the company's
exposure to certain issuers through investments in debt
securities, and the company's loan loss reserves and other
financial items.
The complaint seeks unspecified compensatory damages, the right
to rescind the purchases of securities in the public offerings,
interest, and plaintiffs' reasonable costs and expenses,
including attorneys' fees and expert fees.
On March 10, 2008, the defendants moved to dismiss the complaint
on a number of grounds. Briefing on the dismissal motions is
presently scheduled to close on June 5, 2008.
The suit is "A1 Credit Company v. RAIT Financial Trust, et al.,
Case No. 2:07-cv-03148-LDD," filed before the U.S. District
Court for the Eastern District of Pennsylvania, Judge Legrome D.
Davis, presiding.
Representing the plaintiffs are:
Gerald S. Berkowitz (gsb@berklein.com)
Berkowitz and Klein LLP
625 B Swedesford Rd.
Swedsford Corporate Center
Malvern, PA 19355-1530
Phone: 610-889-3200
Fax: 610-889-9564
- and -
Roberta D. Liebenberg, Esq.
(rliebenberg@finekaplan.com)
Fine, Kaplan and Black
1835 Market St.
28th Floor
Philadelphia, PA 19103
Phone: 215-567-6565
Fax: 215-568-5872
Representing the defendants are:
Robert W. Hayes, Esq. (rhayes@cozen.com)
Cozen O'Connor
1900 Market Street
Philadelphia, PA 19103
Phone: 215-665-2094
Fax: 215-665-2013
- and -
Barbara W. Mather, Esq. (matherb@pepperlaw.com)
Pepper Hamilton LLP
3000 Two Logan Sq.
18th & Arch Streets
Philadelphia, PA 19103-2799
Phone: 215-981-4895
Fax: 215-981-4756
REGIONAL CONTRACTORS: Face Calif. Suit Over Labor Code Breach
-------------------------------------------------------------
A class-action lawsuit has been filed in Santa Barbara County
Superior Court accusing two Santa Barbara-based contractors --
ACS Construction and Melchiori Construction -- of labor code
violations, including failure to pay correct wages and overtime,
failure to provide meal and rest breaks, payroll tax fraud and
retaliation, Barbara Pearson of the Pacific Coast Business Times
reports.
The plaintiffs include workers Shane Roberts and Troy Turano,
who were electrician employees of ACS, and various organizations
including:
-- the Ventura County Electrical Joint Apprenticeship
Training Committee;
-- Santa Barbara County Electrical Workers Labor Management
Cooperation Committee; and
-- California Central Coast Chapter of the National
Electrical Contractor's Association.
Among the allegations asserted in the suit were:
(a) The defendant regularly required plaintiffs to work
overtime without paying a rate of one-and-a-half times
the basic rate for the extra hours;
(b) The defendant did not pay plaintiffs for all hours
worked by requiring that they work off-the-clock for
certain time periods;
(c) The defendant did not provide the meal and rest periods
required by law;
(d) The defendant did not hold safety meetings, but
required plaintiffs to sign attendance sheets for the
meetings; and
(e) The defendant "retaliated" against a plaintiff by
terminating his employment after he complained about
receiving incorrect wages.
The suit claims the defendants failed to request apprentices
from the required entities and failed to pay contributions to
organizations that receive funding based on hours worked by
union members.
The plaintiffs' attorney, Ellyn Moscowitz, Esq., said the suit
will likely seek at least $1 million in purported lost wages
from the regional contractors.
Ms. Moscowitz related that the alleged labor violations first
came to her attention following work that ACS, Melchiori and
others did during renovation of The Granada on State Street in
Santa Barbara.
Renovation of the 84-year-old, 1,553-seat theater cost more than
$50 million and involved a round-the-clock effort to meet the
deadline for the opening performance, but Ms. Moscowitz said her
clients were looking beyond The Granada's alleged problems.
TAKE 2 INTERACTIVE: GTA Suit Deal Fairness Hearing Set June 25
--------------------------------------------------------------
The U.S. District Court for the Southern District of New York
will hold a fairness hearing at 10:30 a.m. on June 25, 2008, in
connection with the final approval of a proposed settlement in
the matter, "In Re: Grand Theft Auto Video Game Consumer
Litigation, Case No. 1:06-md-01739-SWK."
Case Background
In July 2005, the defendants -- Take-Two Interactive Software,
Inc., and its subsidiary Rockstar Games -- were subjects of four
purported class action complaints. Two of the four complaints
were filed before the U.S. District Court for the Southern
District of New York, one was filed before the U.S. District
Court for the Eastern District of Pennsylvania, and the other
was filed before the Circuit Court in St. Clair County, Illinois
(Class Action Reporter, Jan. 11, 2008).
The plaintiffs, alleged purchasers of the defendants' Grand
Theft Auto: San Andreas First Edition game manufactured before
July 20, 2005, assert that the company engaged in consumer
deception, false advertising and breached an implied warranty of
merchantability and were unjustly enriched as a result of the
company's alleged failure to disclose that Grand Theft Auto: San
Andreas contained "hidden" content, which resulted in the game
receiving a Mature 17+ (M) rating from the Entertainment
Software Rating Board rather than an Adults Only 18+ rating.
The Judicial Panel on Multidistrict Litigation later transferred
all the cases to the U.S. District Court for the Southern
District of New York, which consolidated them under the caption,
"In re Grand Theft Auto Video Game Consumer Litigation (No. II),
06-MD-1739 (SWK)(MHD)."
Settlement
In the last half of 2007, the defendants reached an agreement to
settle the matter.
Under the terms of the settlement, class members will be able to
claim benefits if they swear that they:
(a) bought a copy of Grand Theft Auto: San Andreas
before July 20, 2005;
(b) were offended and upset by the ability of consumers to
modify and alter the game's content using the third-
party Hot Coffee modification;
(c) would not have bought the game had they known that
consumers could modify and alter the game's content
using the third-party Hot Coffee modification; and
(d) would have returned the game, upon learning the game
could be modified and altered, if they thought this
possible.
Settlement class members who attest to these facts may apply for
benefits that range from an exchange of the game disk for an
edited copy of Grand Theft Auto: San Andreas to a cash payment
of up to $35 for consumers who submit detailed proofs of
purchase.
The following is what class members may obtain under the
settlement:
Available Benefits
If you have and submit: What you may get:
* Grand Theft Auto: San Andreas
First Edition Disc Replacement Disc
* Detailed Store Receipt Cash payment up to $35.00
* General Credit Card Statement
or Check Cash payment up to $17.50
* Disc/Purchase Details Cash payment up to $10.00
* No Disc/Purchase Details Cash payment up to $5.00
The actual value of all cash payments under the settlement will
depend on the number of class members that apply for benefits.
Take-Two has committed to spend at least $1.025 million on
settlement benefits, and the settlement generally caps the
defendants' out-of-pocket costs at no more than $2.75 million,
in addition to the costs of providing notice to class members
and paying a fee to plaintiffs' counsel.
In November 2007, the U.S. District Court for the Southern
District of New York granted preliminary approval to the
settlement (Class Action Reporter, April 18, 2008).
GTA Class Action Settlement on the net:
http://www.gtasettlement.com
The suit is "In Re: Grand Theft Auto Video Game Consumer
Litigation, Case No. 1:06-md-01739-SWK," filed in the U.S.
District Court for the Southern District of New York, Judge
Shirley Wohl Kram presiding.
Representing the plaintiffs is:
Seth R. Lesser, Esq.
Locks Law Firm PLLC
110 East 55th St.
New York, NY 10022
Phone: 888-8LLF-NYC
Representing the company is:
Jeffrey S. Jacobson, Esq.
Debevoise & Plimpton LLP
919 Third Avenue
New York, NY 10022
Phone: 212-909-6000
TRIZETTO GROUP: Faces Del., Calif. Suits Over Proposed Apax Deal
----------------------------------------------------------------
The TriZetto Group, Inc., is facing three purported class action
lawsuits in Delaware and California over its proposed merger
with Apax Partners, L.P., according to Trizetto's May 9, 2008
Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2008.
Initially, two complaints were filed against the company and the
members of its board of directors on April 15, 2008, seeking to
enjoin the proposed merger with Apax Partners.
Delaware Litigation
The first case was a Verified Class Action Complaint filed by
David P. Simonetti Rollover IRA in the Court of Chancery of the
State of Delaware, entitled, "David P. Simonetti Rollover IRA,
Individually and On Behalf of All Others Similarly Situated,
Plaintiff, v. Jeffrey H. Margolis, Donald J. Lothrop, Thomas B.
Johnson, Paul F. Lefort, Jerry P. Widman, Nancy H. Handel, L.
William Krause, Apax Partners, L.P., TZ Holdings, L.P., TZ
Merger Sub, Inc., and The TriZetto Group Inc., Defendants, Case
No. 3694."
The complaint seeks certification of a class of all common
stockholders of TriZetto who are allegedly harmed by the
defendants' actions challenged in the complaint, a declaration
that the defendants have breached their fiduciary and other
duties, entry of an order requiring the defendants to take
certain steps in connection with the proposed transaction,
compensatory damages, costs and disbursements, including the
plaintiff's counsel's fees and experts' fees, and other relief.
California Litigation
The City of Fort Lauderdale Police and Firefighters' Retirement
System filed the second case -- a complaint based on self-
dealing and breach of fiduciary duty -- in the Superior Court of
the State of California, County of Orange. This suit is
entitled, "City of Fort Lauderdale Police and Firefighters'
Retirement System, on Behalf of Itself and All Others Similarly
Situated, Plaintiff, v. Jeffrey H. Margolis, Paul F. Lefort,
Nancy H. Handel, Thomas N. Johnson, L. William Krause, Donald J.
Lothrop, Jerry P. Widman, The TriZetto Group, Inc., and Apax
Partners, Defendants, Case No. 30-2008-00061215."
The complaint seeks certification of a class of all holders of
TriZetto's stock who are allegedly harmed by the defendants'
actions challenged in the complaint, a declaration that the
Agreement and Plan of Merger was entered into in breach of
defendants' fiduciary duties and is therefore unlawful and
unenforceable, injunctive relief enjoining defendants and others
from consummating the proposed transaction, rescission, a
constructive trust, and costs and disbursements, including
attorneys' and experts' fees, among other requested relief.
Second California Litigation
On May 7, 2008, a third complaint was filed against the company
and the members of its Board, seeking to enjoin the proposed
merger. Plaintiff Police and Fire Retirement System of the City
of Detroit filed a complaint based on self-dealing and breach of
fiduciary duties in the Superior Court of the State of
California, County of Orange, entitled, "Police and Fire
Retirement System of the City of Detroit, on Behalf of Itself
and All Others Similarly Situated, Plaintiff, v. The TriZetto
Group Inc., Jeffrey H. Margolis, Donald L. Lothrop, Thomas B.
Johnson, Paul F. Lefort, Jerry P. Widman, Nancy H. Handel, L.
William Krause, Apax Partners, L.P., TZ Holdings, L.P., and TZ
Merger Sub, Inc., Defendants, Case No. 30-2008-00180024."
The complaint seeks certification of a class of all holders of
TriZetto's stock who are allegedly harmed by the defendants'
actions challenged in the complaint, a declaration that the
Agreement and Plan of Merger was entered into in breach of
defendants' fiduciary duties, injunctive relief enjoining
defendants from disenfranchising the proposed class and
consummating the proposed transaction, and costs and
disbursements, including attorneys' fees, among other requested
relief.
The company reported no further development in the matters in
its regulatory SEC filing.
The TriZetto Group, Inc. -- http://www.trizetto.com/-- offers a
portfolio of information technology products and services
targeted to the payer industry, which is comprised of health
insurance plans and third party benefits administrators. The
Company offers core administration software, including Facets
Extended Enterprise, QicLink Extended Enterprise, QNXT,
enterprise software, including Clinical CareAdvance and Personal
CareAdvance, and its NetworX suite for provider network
management. The Company also provides a number of component
software solutions and add-ons to the enterprise software
solutions, including Workflow, Constituent Web Solution and
Benefit Cost Modeler. In addition, the Company also provides
business solutions for Medicare Advantage, Detection and
Recovery Services, and Healthcare Informatics.
UNITED PARCEL: Must Face "Mom & Pop" Franchisees Trial in Calif.
----------------------------------------------------------------
A decision by the California Appellate Court on May 23 reversed
the 2007 decision by a Los Angeles Superior Court that had
granted motions by United Parcel Service (NYSE: UPS) and Mail
Boxes Etc., Inc. (MBE) for summary judgments against its
franchisees.
"The Court of Appeals gave us a total victory. The court
reversed every single claim that UPS/MBE made, and awarded costs
on appeal to the plaintiffs. This is a complete repudiation of
UPS' and MBE's position and was the last major hurdle for us,"
stated Howard Spanier. "Now UPS must face a public trial, where
UPS and MBE will be forced to explain their anti-franchisee
actions in front of a jury. We can't wait to finally have our
day in court," he added.
Mr. Spanier is the owner of Malibu Business & Shipping Center,
which had previously been a Mail Boxes Etc. "The reason I am no
longer at Mail Boxes Etc. is that UPS blocked my renewal as an
MBE despite my franchise agreement allowing me to do so. They
would only allow me to renew as a UPS Store. I considered that
option to be financial suicide, since under the UPS Store
business model profit is totally controlled by UPS."
Mr. Spanier is also President of the Platinum Shield Association
(PSA), one of three franchisee associations litigating against
UPS. PSA has been involved in the lawsuit with UPS since 2003.
Other former MBE franchisees were also forced to go independent.
Glenn Sturgis of Montpelier, Vermont is one of them. He is a
PSA member and is now the owner of Capitol Copy in Montpelier,
after being blocked by UPS from renewing as an MBE. "The latest
bullying tactic by UPS against its 'Mom & Pop' franchisees is,
after blocking their renewal as an MBE, to close their UPS
retail shipping account. Clearly, UPS wants to further disrupt
the relationship franchisees have with their customers and thus
cut off a source of revenue."
Mr. Sturgis continued, "First UPS destroyed our franchise brand
and now UPS has tried to drive us out of business. We are
committed to our cause and look forward to having our day in
court and demonstrating the unlawful acts of UPS. This cynical,
indifferent bully corporation will be brought to justice."
The five-year-old lawsuit alleges among other charges UPS'
intentional destruction of the Mail Boxes Etc. franchise brand
and business system, violation of the MBE franchise agreements,
fraud and anti-competitive actions by UPS in its creation of the
UPS Store franchise system.
This decision is the third time that the California Court of
Appeals has reversed the lower court and upheld the case of the
UPS/MBE franchisees. The previous decision by the Court of
Appeals was to grant certification of a national class action
against UPS on behalf of the UPS Store franchisees.
UNITED PARCEL: Appeals Court Reverses Favorable "Marlo" Ruling
--------------------------------------------------------------
An appeals court reversed a a California federal court's summary
judgment in favor of United Parcel Service, Inc. on all claims
in the case, entitled, "Marlo v. UPS," which contains various
class-action allegations under certain wage-and-hour laws.
Marlo Litigation
"Marlo v. UPS" was certified as a class action in a California
federal court. In the case, the plaintiffs allege that they
improperly were denied overtime. They are seeking penalties for
missed meal and rest periods, and interest and attorneys' fees.
The plaintiffs purport to represent a class of 1,300 full-time
supervisors.
In August 2005, the court granted summary judgment in favor of
UPS on all claims, and the plaintiff appealed the ruling. In
October 2007, the appeals court reversed the lower court's
ruling, according to the company's May 2008 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2008.
The company reported no further development in the matter in its
regulatory SEC disclosure.
United Parcel Service, Inc. -- http://www.ups.com/-- is a
package delivery and supply chain management company. The
primary business of the Company includes time-definite delivery
of packages and documents. Other services of UPS include supply
chain solutions, such as freight forwarding, customs brokerage,
fulfillment, returns, financial transactions, repairs and less-
than-truckload transportation services.
UNITED PARCEL: Faces Antitrust Suit Over Fuel Surcharge Rates
-------------------------------------------------------------
United Parcel Service, Inc., and UPS Freight, along with several
other companies involved in the less-than-truckload freight
business, are facing numerous putative class action lawsuits
filed since July 30, 2007.
On July 30, 2007, Farm Water Technological Services, Inc. (doing
business as Water Tech) and C.B.J.T. (doing business as
Agricultural Supply), on behalf of themselves and other
plaintiffs, filed a putative class action lawsuit against the
company and other companies engaged in the LTL trucking business
in the U.S. District Court for the Southern District of
California (Class Action Reporter, May 19, 2008).
The other named defendants in the complaint are:
-- Arkansas Best Corp.,
-- Averitt Express,
-- Con-Way, Inc.,
-- Fedex Corp.,
-- Jevic Transportation, Inc.,
-- Sun Capital Partners IV, LLC,
-- New England Motor Freight, Inc.,
-- R+L Carriers, Inc.,
-- Saia, Inc.,
-- United Parcel Service, Inc.,
-- YRC Worldwide Inc., and
-- Old Dominion Motor Freight, Inc.
Farm Water and C.B.J.T. contend that the practice dates back to
2003. They assert that the carriers agreed to impose identical
or nearly identical surcharges by linking them to diesel fuel
prices published by the U.S. Department of Energy and by listing
surcharges on their websites to communicate pricing.
The plaintiffs bring the action on behalf of all persons or
entities who purchased LTL service directly from the defendants
or their unnamed co-conspirators from July 30, 2003, through the
conclusion of the trial in this matter.
The plaintiffs want the court to rule on:
(a) whether defendants and their co-conspirators engaged in
a combination and conspiracy among themselves to fix,
raise, maintain or stabilize fuel surcharges imposed
for LTL services sold in the United States;
(b) the identity of the participants in the conspiracy;
(c) the duration of the conspiracy alleged in this
complaint and the nature and character of the acts
performed by defendants and their co-conspirators in
furtherance of the conspiracy;
(d) whether the alleged conspiracy violated Section of the
Sherman Act;
(e) whether the conduct of defendants and their co-
conspirators, as alleged in the complaint, caused
injury to the business and property plaintiffs and
other members of the classes;
(f) the effect of defendants' conspiracy on the prices of
LTL services sold in the United States during the class
period; and
(g) the appropriate measure of damages sustained by
plaintiffs and other members of the damages class.
The plaintiffs pray that:
-- the court determines that this action may be maintained
as a class action under Rule 23 of the Federal Rules of
Civil Procedure;
-- the contract, combination or conspiracy, and the acts
done in furtherance thereof by defendants and their co-
conspirators, b adjudged to have been in violation of
Section 1 of the Sherman Act, 15 U.S.C. Section 1;
-- judgment be entered for plaintiffs and members of the
damages class against defendants for three times the
amount of damages sustained by plaintiffs and the
damages class as allowed by law, together with the costs
of this action, including reasonable attorneys' fees;
-- defendants and their affiliates, successors,
transferees, assignees, and the officers, directors,
partners, agents and employees thereof, and all other
persons acting or claiming to ac on their behalf, be
permanently enjoined and restrained from, in any manner:
(i) continuing, maintaining or renewing the contract,
combination or conspiracy alleged, or from engaging
in any other contract, combination or conspiracy
having a similar purpose or effect, and from
adopting or following any practice, plan, program
or device having a similar purpose or effect; and
(ii) communicating or causing to be communicated to any
other person engaged in the manufacture,
distribution or sale of any product except to the
extent necessary in connection with a bona fide
sales transaction between the parties to such
communications; and
-- plaintiffs and members of the class have such other,
further and different relief as the case may require and
the court may deem just and proper under the
circumstances.
Subsequent to this original complaint, similar complaints have
been filed against the defendants and other LTL motor carriers,
each with the same allegation of conspiracy to fix fuel
surcharge rates.
The cases have been consolidated for pretrial purposes in a
Multi-District Litigation proceeding with the U.S. District
Court for the Northern District of Georgia.
The lawsuits allege that the defendants conspired to fix fuel
surcharge rates, and they seek injunctive relief, treble damages
and attorneys' fees, according to the company's May 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended March 31, 2008.
United Parcel Service, Inc. -- http://www.ups.com/-- is a
package delivery and supply chain management company. The
primary business of the Company includes time-definite delivery
of packages and documents. Other services of UPS include supply
chain solutions, such as freight forwarding, customs brokerage,
fulfillment, returns, financial transactions, repairs and less-
than-truckload transportation services.
UNUM GROUP: Court Approves $40-Mln Settlement in Investors' Suit
----------------------------------------------------------------
U.S. District Judge Curtis L. Collier approved a $40-million
settlement for Unum Group investors whose lawsuit accused the
Chattanooga-based disability insurer of artificially inflating
its stock price, The Associated Press reports.
According to the AP report, Judge Collier's approval of the
agreement ends the five-year-old suit. Unum attorney Brian
Frawley, Esq., said, however, that the company "continues to
deny the allegation."
Company spokesman Jim Sabourin said Unum agreed to the
settlement "essentially to prevent further controversy and to
avoid the significant costs associated with continued
litigation." He also indicated that the company's earnings
report showed the $40-million settlement in 2007.
The class-action suit, possibly involving almost 186,000
investors between March 2000 and April 2003, contended that Unum
made misleading statements to artificially inflate its share
price.
Plaintiffs' attorney Keith Park, Esq., of San Diego told the AP
that none of his clients have objected to the settlement. He
also said that June 6, 2008, is the deadline for filing claims.
VALUECLICK INC: Seeks Dismissal of California Securities Lawsuit
----------------------------------------------------------------
ValueClick, Inc., seeks the dismissal of a consolidated
securities fraud class action lawsuit filed before the U.S.
District Court for the Central District of California.
On Aug. 17, 2007, a purported securities fraud class action suit
was filed by Carl Waldrep, on behalf of himself and all others
similarly situated, presuming to represent all persons who
purchased or otherwise acquired the common stock of ValueClick,
Inc., between Nov. 1, 2006, and July 27, 2007.
The lawsuit alleges violations of certain federal securities
laws and is brought against the company, its executive chairman
and its chief administrative officer.
A similar purported class action was filed later. On Nov. 20,
2007, the U.S. District Court for the Central District of
California consolidated the second purported securities fraud
class action with the first lawsuit. The court appointed the
combined funds of Laborers' International Union of North America
National Pension and the LIUNA Staff & Affiliates Pension Fund
as lead plaintiffs.
In January 2008, the LIUNA Funds filed a consolidated complaint
alleging violations of certain federal securities laws based
upon the company's and its officers' alleged misrepresentation
of materially false and misleading statements concerning the
company's compliance with laws and standards applicable to its
lead generation business, among other things.
The LIUNA Funds purport to represent all persons who purchased
or otherwise acquired the common stock of the company between
June 13, 2005, and July 27, 2007, and seek class certification,
damages, costs incurred in bringing suit, and
equitable/injunctive relief.
In March 2008, the company filed a motion to dismiss the
litigation, according to the company's May 2008 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the
quarterly period ended March 31, 2008.
The suit is "Carl Waldrep, et al. v. ValueClick, Inc., et al.,
Case No. 2:2007cv05411," filed in the U.S. District Court for
the Central District of California, Judge Dean D. Pregerson,
presiding.
Representing the plaintiffs are:
Daniel E. Bacine, Esq. (dbacine@barrack.com)
Barrack Rodos and Bacine
3300 Two Commerce Square, 2001 Market Street
Philadelphia, PA 19103
Phone: 215-963-0600
- and -
Mary K. Blasy, Esq. (maryb@csgrr.com)
Coughlin Stoia Geller Rudman and Robbins
655 West Broadway, Suite 1900
San Diego, CA 92101
Phone: 619-231-1058
Representing the defendants is:
Michael B. Smith, Esq. (mbsmith@gibsondunn.com)
Gibson Dunn and Crutcher
1881 Page Mill Road
Palo Alto, CA 94304
Phone: 650-849-5300
WEST CORP: Expert Discovery Ongoing in "Sanford" Litigation
-----------------------------------------------------------
Expert discovery is ongoing in the matter "Sanford v. West Corp.
et al., No. GIC 805541," which accuses West Corp. of engaging in
unlawful business practice when it sent Memberworks, Inc.
membership kits to people who inquired about or purchased
another product from the company.
The litigation was filed on Feb. 13, 2003, with the San Diego
County, California Superior Court. The original complaint
alleged:
-- violations of the California Consumer Legal Remedies
Act, California Civil Code SS 1750 et seq.;
-- unlawful, fraudulent and unfair business practices in
violation of California Business & Professions Code SS
17200 et seq.;
-- untrue or misleading advertising in violation of
California Business & Professions Code SS 17500 et seq.;
and
-- common law claims for conversion, unjust enrichment,
fraud and deceit, and negligent misrepresentation, and
sought monetary damages, including punitive damages, as
well as restitution, injunctive relief and attorneys
fees and costs.
The complaint was brought on behalf of a purported class of
persons in California who were sent a Memberworks membership kit
in the mail, were charged for an MWI membership program, and
were allegedly either customers of what the complaint contended
was a joint venture between MWI and West Corp. or West
Telemarketing Corp. or wholesale customers of West Corp. or West
Telemarketing.
West Telemarketing and West Corp. filed a demurrer in the trial
court on July 7, 2004. The court sustained the demurrer as to
all causes of action in the plaintiff's complaint, with leave to
amend. West Telemarketing and West Corp. received an amended
complaint and filed a renewed demurrer.
On Jan. 24, 2005, the court entered an order sustaining West
Corp. and West Telemarketing's demurrer with respect to five of
the seven causes of action. On Feb. 14, 2005, West
Telemarketing and West Corp. filed a motion for judgment on the
pleadings seeking a judgment as to the remaining claims.
On April 26, 2005, the court granted the motion without leave to
amend. The court also denied a motion to intervene filed on
behalf of Lisa Blankenship and Vicky Berryman. The court
entered judgment in West Corp.'s and West Telemarketing's favor
on May 5, 2005. The plaintiff and proposed intervenors appealed
the judgment and the order denying intervention.
On June 30, 2006, the 4th Appellate District Court of Appeals
affirmed the entry of judgment against the original plaintiff,
Patricia Sanford, but reversed the denial of the motion to
intervene and remanded the case for the trial court to determine
whether Ms. Berryman and Ms. Blankenship should be added as
plaintiffs through intervention or amendment of the complaint.
On Dec. 1, 2006, the trial court permitted Ms. Berryman and Ms.
Blankenship to join the action pursuant to a second amended
complaint which contained the same claims as Sanford's original
complaint. West Corp. and West Telemarketing filed a demurrer
to the second amended complaint. The Court overruled that the
demurrer, with one exception, on Dec. 4, 2006.
On Feb. 16, 2007, after receiving briefing and hearing argument
on class certification, the trial court certified a class
consisting of:
"All persons in California, who, after calling defendants
West Corp. and West Telemarketing Corp. (collectively
"West" or "defendants") to inquire about or purchase
another product between Sept. 1, 1998, through July 2,
2001, were:
(a) sent a membership kit in the mail;
(b) charged for a MemberWorks, Inc. membership program;
and
(c) customers of a joint venture between MWI and West or
were wholesale customers of West.
Not included in the class are defendants and their officers,
directors, employees, agents and/or affiliates."
On March 19, 2007, West and West Telemarketing filed a Petition
for Writ of Mandate and Request for Stay asking the appellate
court to first stay and then order reversal of the Superior
Court's class certification Order.
However, this Petition was denied on June 8, 2007. Thereafter,
on June 18, 2007, West and West Telemarketing filed a Petition
for Review and Request for Stay in the California Supreme Court,
but this Petition was denied on June 27, 2007.
Discovery in the Superior Court as to the facts of the case is
almost complete and expert discovery remains, according to West
Corp.'s May 9, 2008 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2008.
West Corp. -- http://www.west.com/-- is a customer relationship
management (CRM) solution provider, offering comprehensive
customer service outsourcing programs.
WEST CORP: Sup. Ct. Upholds Certification of Class in "Ritt"
------------------------------------------------------------
The Ohio Supreme Court declined to review the certification of a
class in the case, "Brandy L. Ritt, et al. v. Billy Blanks
Enterprises, et al.," which relates to the marketing of certain
membership programs offered by the company's clients.
The original suit was filed in January 2001 in the Court of
Common Pleas in Cuyahoga County, Ohio, against two of the
company's clients.
The case, a purported class action, was amended for the third
time in July 2001 and West Corp. was added as a defendant at
that time.
The suit, which seeks statutory, compensatory, and punitive
damages as well as injunctive and other relief, alleges
violations of various provisions of Ohio's consumer protection
laws, negligent misrepresentation, fraud, breach of contract,
unjust enrichment and civil conspiracy in connection with the
marketing of certain membership programs offered by the
company's clients.
On Feb. 6, 2002, the court denied the plaintiffs' motion for
class certification. On July 21, 2003, the Ohio Court of
Appeals reversed and remanded the case to the trial court for
further proceedings.
The plaintiffs filed a Fourth Amended Complaint naming West
Telemarketing Corp. as an additional defendant and a renewed
motion for class certification.
One of the defendants, NCP Marketing Group, filed for bankruptcy
and on July 12, 2004, removed the case to federal court. The
plaintiffs filed a motion to remand the case back to state
court.
On Aug. 30, 2005, the U.S. Bankruptcy Court for the District of
Nevada remanded the case back to the state court in Cuyahoga
County, Ohio. The Bankruptcy Court also approved a settlement
between the named plaintiffs and:
-- NCP,
-- Shape The Future International LLP, and
-- Integrity Global Marketing LLC.
West Corp. and West Telemarketing Corp. have filed motions for
judgment on the pleadings and a motion for summary judgment.
On March 28, 2006, the state trial court certified a class of
Ohio residents. West and WTC filed a notice of appeal from that
decision, and the plaintiffs cross-appealed. The appeal was
briefed and was then argued on Feb. 26, 2007.
On April 12, 2007, the Court of Appeal affirmed in part and
reversed in part the trial court's Order.
The Court of Appeal ordered certification of a class of "All
residents of Ohio who, from September 1, 1998 through July 2,
2001:
(a) called a toll-free number, marketed by West and MWI, to
purchase any Tae-Bo product;
(b) purchased a Tae-Bo product;
(c) subsequently were enrolled in an MWI membership
program; and
(d) were charged for the MWI membership on their
credit/debit card.
Not included in the class are defendants, and their officers,
directors, employees, agents, and/or affiliates."
West and WTC sought review of this ruling by the Ohio Supreme
Court. However, on Oct. 3, 2007, the Ohio Supreme Court
declined to review the case. West and WTC's summary judgment
motion remains pending.
West Corp. reported no furtehr development in the matter in its
May 9, 2008 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2008.
West Corp. -- http://www.west.com/-- is a customer relationship
management solution provider, offering comprehensive customer
service outsourcing programs.
* Class Action Powerhouse Schneider & Wallace Changes Firm Name
---------------------------------------------------------------
San Francisco-based Schneider & Wallace, a leading class action
law firm serving the legal needs of employees and consumers for
15 years, is now Schneider Wallace Cottrell Brayton Konecky LLP.
The firm name change reflects its growth and the ongoing
contributions of Partners Carolyn Cottrell, Esq., Clint Brayton,
Esq., and Joshua Konecky, Esq.
"During the last 15 years, our attorney ranks have grown in
numbers and the matters we handle have also expanded in both
size and importance. Carolyn, Clint and Josh have all played
substantial roles in that growth and in the firm's success, and
I can think of no better way to acknowledge this to our clients
and community than putting their names on the door," said Todd
Schneider, Esq., founder and partner.
Founded in 1993, the firm has experienced consistent, strategic
growth and has demonstrated continued success in leading class
actions against corporations and government entities.
Recently, the firm has handled high-profile class actions
involving:
-- race discrimination (Satchell v. FedEx),
-- race and gender discrimination (Holloway v. BestBuy),
-- access to education for disabled students (Lopez v.
SFUSD),
-- sexual orientation discrimination (Carlson v. eHarmony),
-- disability discrimination of behalf of deaf employees
(Bates v. UPS) and
-- gender discrimination (Singlton v. Regents of the
University of California).
Ms. Cottrell focuses on discrimination, harassment and
retaliation matters. She has litigated hundreds of employment
discrimination and civil rights actions. She is a member of the
State Bar of California, San Francisco Trial Lawyers
Association, Public Justice and California Employment Lawyers
Association. She earned her J.D. from the University of
Pacific, McGeorge School of Law (1993).
Involved in the trial of several high-profile cases, Mr. Brayton
has extensive experience litigating employment claims in both
federal and state court. He is a member of the San Francisco
Trial Lawyers Association and Consumer Attorneys of California.
Brayton earned his J.D. from Loyola Law School (1997).
Mr. Konecky handles matters involving disability rights,
employment discrimination and wage and hour class actions. His
extensive experience includes trial and appellate work in
federal and state courts. A frequent lecturer, Mr. Konecky has
authored and edited publications on discrimination and
employment law. He is a former Skadden Public Interest Law
Fellow, U.S. Fulbright Scholar in Argentina and judicial law
clerk for the Honorable Lawrence K. Karlton, U.S. District Court
for the Eastern District of California. Mr. Konecky earned his
J.D. from New York University School of Law (1995).
Schneider Wallace Cottrell Brayton Konecky LLP is a dedicated
group of California trial lawyers committed to continuing the
work of the civil rights movement through individual and class
action litigation. For 15 years, the firm's attorneys have
handled matters involving: class action lawsuits involving
disability rights employment discrimination wage and hour and
consumer rights.
For more information, contact:
Schneider Wallace Cottrell Brayton Konecky LLP
180 Montgomery Street, Suite 2000
San Francisco, CA
Web site: http://www.schneiderwallace.com/
* Ohio Securities Case Widens to Include Housing Market Losses
--------------------------------------------------------------
The Ohio Attorney General's Office, which has been prosecuting a
securities class action case against American International
Group, Inc., and 22 other defendants for more than three years,
announced its intention to add claims relating to AIG's recent
multi-billion dollar write-downs stemming from its exposure to
problems in the residential housing market.
Last week, the Ohio Attorney General asked the judge presiding
over the case in New York federal court for permission to seek
damages relating to the more than $20 billion in write-downs
that AIG recently incurred from losses in its portfolio of
credit default swaps, which are complex derivatives that insure
against the risk of default on underlying bonds. The court has
scheduled a hearing on the matter for June 3.
The existing securities class action, which is being prosecuted
by the Ohio Attorney General's Office on behalf of the Ohio
Public Employees Retirement System, State Teachers Retirement
System and Ohio Police & Fire Pension Fund, has been pending
since late in 2004. The suit seeks damages on behalf of a class
of investors in connection with AIG's involvement in a market
division scheme with others in the insurance industry, and
relating to AIG's improper accounting for reinsurance and other
transactions that led to the company's $3.9 billion restatement
of earnings in May 2005.
Those accounting problems led to the ouster of AIG's then-
Chairman and CEO, Maurice R. "Hank" Greenberg, and several other
senior company executives. Mr. Greenberg, along with AIG's
current CEO, Martin J. Sullivan, are already named as defendants
in the lawsuit.
New Securities Fraud Cases
AMERICAN INSURANCE: Florida Pension Fund Files Lawsuit in N.Y.
--------------------------------------------------------------
Bernstein Litowitz Berger & Grossmann LLP filed a class action
lawsuit in the United States District Court for the Southern
District of New York on behalf of its client Jacksonville Police
and Fire Pension Fund (Jacksonville Police & Fire) and
purchasers of the securities of American International Group,
Inc. (NYSE: AIG) during the period from May 11, 2007, through
May 9, 2008.
The complaint alleges that during the Class Period, AIG and the
individual defendants, Chief Executive Officer Martin J.
Sullivan, Executive Vice President and Chief Financial Officer
Steven J. Bensinger, Senior Vice President and Chief Risk
Officer Robert Lewis and Joseph Cassano, the former head of AIG
subsidiary American International Group Financial Products
(AIGFP), violated the federal securities laws by issuing false
and misleading press releases, financial statements, filings
with the SEC and statements during investor conference calls.
The complaint alleges that, throughout the class period, the
defendants repeatedly reassured investors that AIG had
successfully insulated itself from the recent turmoil in the
housing and credit markets due to its superior risk management.
In particular, the defendants touted the security of AIGFP's
"super senior" credit default swap (CDS) portfolio, making
numerous statements that this portfolio was secure and that
AIG's method for accounting for the valuations of this portfolio
accurately reflected its value.
Investors began to learn the truth regarding AIG's financial
condition and the Company's exposure to the mortgage market
when, on February 11, 2008, the Company disclosed that its
outside auditor had determined that there was "material weakness
in its internal control" over the financial reporting and
oversight relating specifically to its accounting for the CDS
portfolio, and that the Company was revising the loss valuations
it previously reported. Under the new valuations, losses on the
CDS portfolio more than quadrupled -- from the $1.4 billion
reported on the CDS portfolio just weeks before to over
$4.5 billion. Two weeks later, on February 28, 2008, AIG
disclosed that the market valuations on the CDS portfolio would
increase to $11.5 billion and revealed for the first time that
the Company had notional exposure of $6.5 billion in liquidity
puts written on collateralized debt obligations (CDOs) linked to
the sub-prime mortgage market. Finally, on May 8, 2008, the
Company disclosed that market valuation losses on the CDS
portfolio for the quarter climbed an additional $9.1 billion,
for a cumulative loss of $20.6 billion, and that the Company was
expecting actual losses on the portfolio to be about $2.4
billion. As a result of these disclosures, the price of AIG
stock plunged from a class period high of $75.24 per share on
June 5, 2008, to $38.37 per share on May 12, 2008, wiping out
tens of billions of dollars in shareholder value and causing
damage to the class.
The complaint alleges that the defendants violated Section 10(b)
of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder and that Defendants Sullivan and
Bensinger violated Section 20(a) of the Exchange Act.
Interested parties may move the court no later than 60 days from
July 21, 2008, for lead plaintiff appointment.
For more information, contact:
Gerald H. Silk, Esq.
Salvatore J. Graziano, Esq.
Bernstein Litowitz Berger & Grossmann LLP
1285 Avenue of the Americas
New York, NY 10019
Phone: 212-554-1400
Fax: 212-554-1444
ARBITRON INC: Brower Piven Files Securities Fraud Suit in N.Y.
--------------------------------------------------------------
Brower Piven, A Professional Corporation, has commenced a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of purchasers of the
common stock of Arbitron, Inc. between July 19, 2007, and
November 26, 2007, inclusive.
The complaint alleges that, during the Class Period, the
Company, and certain of its officers and directors, violated
federal securities laws by issuing materially false and
misleading statements that hid from the investing public that
the Company was experiencing difficulties that would delay
implementation of its Portable People Meter audience ratings
service in certain major markets.
The complaint further alleges that such anticipated delays
caused defendants to lack a reasonable basis for positive
statements about the timing of the implementation of Arbitron's
Portable People Meter ratings service and the Company's
prospects and future earnings.
On November 26, 2007, Arbitron announced that "it [would] delay
the commercialization of its Portable People Meter (PPM) radio
ratings service in nine markets" and that the Company would
revise its financial guidance for 2007 and its outlook for 2008.
After this news, the price of Arbitron common stock declined on
high trading volume.
Interested parties may move the court no later than June 30,
2008, for lead plaintiff appointment.
For more information, contact:
Brower Piven, A Professional Corporation
The World Trade Center-Baltimore
401 East Pratt Street, Suite 2525
Baltimore, MD 21202
Phone: 410-332-0030
e-mail: hoffman@browerpiven.com
Web site: http://www.browerpiven.com/
DOWNEY FINANCIAL: Brower Piven Files Securities Suit in Calif.
--------------------------------------------------------------
Brower Piven, A Professional Corporation, disclosed that a class
action lawsuit has been commenced in the United States District
Court for the Central District of California on behalf of
purchasers of the common stock of Downey Financial Corp.
between October 16, 2006, and March 14, 2008, inclusive.
The complaint alleges that, during the Class Period, the
Company, and certain of its officers and directors, violated
federal securities laws by withholding material facts from the
investing public, including:
-- that defendants' portfolio of Option ARMs contained
millions of dollars worth of impaired and risky
securities backed by subprime mortgage loans;
-- that prior to the Class Period, Downey became more
aggressive by acquiring risky loans from brokers; and
-- that defendants failed to properly account for highly
leveraged loans and to adequately reserve for Option ARM
loans in, at risk of, default.
After announcing on October 10, 2007, that it expected to incur
an operating loss for the 2007 third quarter, on March 17, 2008,
Downey released financial results showing an increase in non-
performing assets. This news caused Downey's stock price to
drop.
Interested parties may move the court no later than July 15,
2008, for lead plaintiff appointment.
For more information, contact:
Brower Piven, A Professional Corporation
The World Trade Center-Baltimore
401 East Pratt Street, Suite 2525
Baltimore, MD 21202
Phone: 410-332-0030
e-mail: hoffman@browerpiven.com
Web site: http://www.browerpiven.com/
MGIC INVESTMENT: Brower Piven Files Securities Suit in Michigan
---------------------------------------------------------------
Brower Piven, A Professional Corporation, has commenced a class
action lawsuit in the United States District Court for the
Eastern District of Michigan on behalf of purchasers of the
common stock of MGIC Investment Corporation between February 6,
2007, through February 12, 2008, inclusive.
The complaint alleges that, during the Class Period, the
Company, and certain of its officers and directors, violated
federal securities laws by withholding material facts from the
investing public, including:
-- that the Company's investment in Credit-Based Asset
Servicing and Securitization LLC (C-BASS) was materially
impaired from increasing margin calls and rapidly
declining value;
-- that the Company was materially overstating its
financial results by failing to properly value its
investment in C-BASS in violation of Generally Accepted
Accounting Principles; and
-- that the Company's loss and default exposure was far
greater than previously disclosed.
On February 13, 2008, MGIC announced its fourth quarter 2007
results reporting a net loss for the quarter of $1.47 billion,
including an after-tax charge of $33 million related to equity
losses incurred by C-BASS. After this announcement, MGIC's
stock traded at the lowest price it had traded in over thirteen
years.
Interested parties may move the court no later than July 15,
2008, for lead plaintiff appointment.
For more information, contact:
Brower Piven, A Professional Corporation
The World Trade Center-Baltimore
401 East Pratt Street, Suite 2525
Baltimore, MD 21202
Phone: 410-332-0030
e-mail: hoffman@browerpiven.com
Web site: http://www.browerpiven.com/
TRM CORP: Schatz Nobel Files Oregon Securities Fraud Lawsuit
------------------------------------------------------------
The law firm of Schatz Nobel Izard P.C., which has significant
experience representing investors in prosecuting claims of
securities fraud, disclosed that a lawsuit seeking class action
status has been filed in the United States District Court for
the District of Oregon on behalf of all persons who purchased
the common stock of TRM Corporation, between March 16, 2006, and
May 22, 2007, inclusive.
The Complaint charges that TRM and certain of its officers and
directors violated federal securities laws by issuing materially
false and misleading statements regarding the Company's
financial health and performance. As alleged in the Complaint,
these statements were materially false and misleading because
defendants misrepresented and failed to disclose:
(i) that the Company's financial results were artificially
inflated due to the failure to timely write down
certain assets, which were materially overvalued in the
Company's financial statements;
(ii) that TRM lacked adequate internal controls and
procedures necessary to ascertain its true financial
condition and worth; and
(iii) as a result of the foregoing, the Company's ability to
continue its operations and remain a going-concern was
in serious doubt.
At the end of the Class Period, TRM provided investors with
details about the progress of its restructuring plan and
announced new management positions. Following this disclosure,
shares of the Company's stock declined dramatically.
Interested parties may move the court no later than July 22,
2008, for lead plaintiff appointment.
For more information, contact:
Wayne T. Boulton, Esq.
Nancy A. Kulesa, Esq.
Schatz Nobel Izard P.C.
20 Church Street, Suite 1700
Hartford, CT 0610
Phone: 800-797-5499
e-mail: firm@snilaw.com
Web site: http://www.snilaw.com/
Meetings, Conferences & Seminars
* Scheduled Events for Class Action Professionals
-------------------------------------------------
May 29-30, 2008
MASS LITIGATION
ALI-ABA
Charleston, SC
Contact: 215-243-1614; 800-CLE-NEWS x1614
June 23-24, 2008
MEALEY'S WRAP INSURANCE CONFERENCE
Mealeys Seminars
The Signatures at the MGM Grand, Las Vegas
Phone: 1-800-MEALEYS; 610-768-7800;
e-mail: mealeyseminars@lexisnexis.com
June 25, 2008
LEXISNEXIS WOMEN IN THE LEGAL PROFESSION SUMMIT: RAINMAKING,
NEGOTIATING AND COLLABORATIVE DEVELOPMENT (NEW YORK)
Mealeys Seminars
The Harvard Club, New York
Phone: 1-800-MEALEYS; 610-768-7800;
e-mail: mealeyseminars@lexisnexis.com
July 10-11, 2008
CLASS ACTION LITIGATION 2008: PROSECUTION AND
DEFENSE STRATEGIES
Practising Law Institute
New York
Phone: 800-260-4PLI; 212-824-5710
July 30, 2008
MANAGING COMPLEX FEDERAL LITIGATION: A PRACTICAL GUIDE TO NEW
DEVELOPMENTS, PROCEDURES, & STRATEGIES
Practising Law Institute
Chicago
Phone: 800-260-4PLI; 212-824-5710
October 23-24, 2008
Mass Torts Made Perfect Seminar
Mass Torts Made Perfect
Bellagio, Las Vegas
Phone: 1-800-320-2227
* Online Teleconferences
------------------------
December 13, 2008
MEALEY'S FINITE REINSURANCE TELECONFERENCE
Mealeys Seminars
Phone: 1-800-MEALEYS; 610-768-7800;
e-mail: mealeyseminars@lexisnexis.com
CACI: CALIFORNIA'S NEW CIVIL JURY INSTRUCTIONS
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
CIVIL LITIGATION PRACTICE: 22ND ANNUAL RECENT DEVELOPMENTS
(2004)
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
CIVIL LITIGATION PRACTICE: 23RD ANNUAL RECENT DEVELOPMENTS
(2005)
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
EFFECTIVE DIRECT AND CROSS EXAMINATION
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
PUNITIVE DAMAGES: MAXIMIZING YOUR CLIENT'S SUCCESS OR MINIMIZING
YOUR CLIENT'S EXPOSURE
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
STRATEGIC TIPS FOR SUCCESSFULLY PROPOUNDING & OPPOSING
WRITTEN DISCOVERY
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
SUMMARY JUDGMENT AND OTHER DISPOSITIVE MOTIONS
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
TORTS PRACTICE: 19TH ANNUAL RECENT DEVELOPMENTS (2004)
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
TORTS PRACTICE: 20TH ANNUAL RECENT DEVELOPMENTS (2005)
CEB Online
e-mail: customer_service@ceb.ucop.edu
Phone: 1-800-232-3444
ADVERSARIAL PROCEEDINGS IN ASBESTOS BANKRUPTCIES
LawCommerce.Com/Mealey's
Online Streaming Video
e-mail: customerservice@lawcommerce.com
ASBESTOS BANKRUPTCY-PANEL OF CREDITORS COMMITTEE MEMBERS
LawCommerce.Com/Mealey's
Online Streaming Video
e-mail: customerservice@lawcommerce.com
EXPERT WITNESS ADMISSIBILITY IN MOLD CASES
LawCommerce.Com/Mealey's
Online Streaming Video
e-mail: customerservice@lawcommerce.com
INTRODUCTION TO CLASS ACTIONS AND LARGE RECOVERIES
Big Class Action
e-mail: seminars@bigclassaction.com
NON-TRADITIONAL DEFENDANTS IN ASBESTOS LITIGATION
Online Streaming Video
LawCommerce.Com/Mealey's
e-mail: customerservice@lawcommerce.com
PAXIL LITIGATION
Online Streaming Video
LawCommerce.Com/Mealey's
e-mail: customerservice@lawcommerce.com
RECENT DEVELOPMENTS INVOLVING BAYCOL
Online Streaming Video
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RECOVERIES
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e-mail: seminars@bigclassaction.com
SELECTION OF MOLD LITIGATION EXPERTS: WHO YOU NEED ON YOUR TEAM
Online Streaming Video
LawCommerce.Com/Mealey's
e-mail: customerservice@lawcommerce.com
SHOULD I FILE A CLASS ACTION?
LawCommerce.Com/Law Education Institute
e-mail: customerservice@lawcommerce.com
THE EFFECTS OF ASBESTOS ON THE PULMONARY SYSTEM
Online Streaming Video
LawCommerce.Com/Mealey's
e-mail: customerservice@lawcommerce.com
THE STATE OF ASBESTOS LITIGATION: JUDICIAL PANEL DISCUSSION
Online Streaming Video
LawCommerce.Com/Mealey's
e-mail: customerservice@lawcommerce.com
TRYING AN ASBESTOS CASE
LawCommerce.Com
e-mail: customerservice@lawcommerce.com
THE IMPACT OF LORILLAR ON STATE AND LOCAL REGULATION OF TOBACCO
SALES AND ADVERSTISING
American Bar Association
Phone: 800-285-2221
e-mail: abacle@abanet.org
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A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent research,
collectively face billions of dollars in asbestos-related
liabilities.
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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 S. Senorin, Janice M. Mendoza, Freya Natasha F.
Dy, and Peter A. 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.
The CAR subscription rate is $575 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
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