/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/080623.mbx C L A S S A C T I O N R E P O R T E R Monday, June 23, 2008, Vol. 10, No. 123 Headlines AGRIFOOD CANADA: Negligence Suit Launched After Computer Theft ALABAMA: Lawsuit Challenges Jefferson County's Huge Sewer Debt AMERICAN FLAME: Replaces Gas Valves Due to Fire, Explosion Risks AMERICAN INTERNATIONAL: Bernstein Litowitz Files Securities Suit AUSTRIAN GOV'T: EUR13.9-Mln Deal Reached in Cable Car Fire Case BIG LOTS: Appeal on Calif. Labor Suit Deal Approval Dismissed BIG LOTS: La. Court Considers Arguments in FLSA Violations Suit BIG LOTS: Calif. Court Mulls Certification of Workers' Lawsuit BIG LOTS: Seeks Stay for Calif. Suits Over Client Info. Request BIG LOTS INC: Seeks Consolidation of Calif. Workers' Wage Cases BROWN SHOE: High Court Denies Retrial Request in Redfield Suit BUSH HOG: Recalls Off-Road UVs Due to Loss of Speed Control CAPE & ISLANDS: ACLU Launches Suit Over Worthington DNA Testing CARDINAL HEALTH: Patients Sue Over Contaminated Surgical Tools CSX CORP: Fla. Suit Claims Directors Breached Fiduciary Duties ESTYLE INC: Recalls Toy Kitchens Posing Choking, Tip-Over Risks FREDERICK'S OF HOLLYWOOD: Settles Calif. Consumer Privacy Suit GENERAL MOTORS: Court Upholds Class Status of Truck Brake Suit GENESCO INC: Faces Consolidated Securities Fraud Suit in Tenn. GENESCO INC: Plaintiffs Dismiss "Falzone" Lawsuit in New York GENESCO INC: Tenn. Court Dismisses Suit Over Foot Locker Offer GENESCO INC: Settles California Labor Code Violations Lawsuit GENESCO INC: Faces Calif. Suit Over Customer E-mail Addresses MEDICARE LITIGATION: Nationwide Prescription Drug Case Settled MEDIS TECH: Court Still to Rule on Securities Suit Dismissal Bid MERRILL LYNCH: Faces Ohio Suit Over Document Preparation Fees MITSUBISHI MOTORS: Faces California Lawsuit Over Peeling Paint MTD: Recalls Cub Cadet Utility Vehicles Due to Fire Hazard PARMALAT: Defendants Object to Interim Approval of Hermes Deal ROHM & HASS: Minnesota Lawsuit Alleges Plastics Price Fixing RUBIO'S RESTAURANTS: Faces Labor-Related Lawsuit in California SHORETEL INC: Faces Two Securities Fraud Lawsuits in California SOLERA HOLDINGS: Faces Lawsuit Over "Total Loss Estimation" TORREYPINES THERAPEUTICS: Motion to Junk Securities Suit Pending U.S. AUTO: Settles Calif. Consolidated Securities Fraud Lawsuit VIRGIN MOBILE: Plaintiff Appeals Dismissal of "Ballas" Lawsuit VIRGIN MOBILE: Continues to Faces D.C. Lawsuit Over Excise Tax VIRGIN MOBILE: Named as Defendant in New Jersey IPO-Related Suit WAL-MART: Recalls Charm Key Chains Due to Risk of Lead Exposure WET SEAL: California Court Approves Employees' Suit Settlement WET SEAL: Withdraws Settlement Offer in Calif. FCRA Litigation * Securities Litigation Team Gets 3 Major Victories in 10 Days ********* AGRIFOOD CANADA: Negligence Suit Launched After Computer Theft -------------------------------------------------------------- The federal government is being accused of negligence regarding the theft of a laptop from the Canadian Canola Growers Association, Portage Online reports. According to Portage Online, a class action lawsuit was filed against Agriculture and Agrifood Canada and the Canola Growers Association as the computer contained confidential information on about 32,000 Canadian producers. Tony Merchant, of the Merchant Law Group, contends that the Canadian government made little effort to protect the data. He notes, in some cases, that people were no longer farming but their information was still stored on the computer. Currently no suspicious activity stemming from the theft has been reported, Portage Online relates. The Canola Growers Association had said that the computer was secured by a password and biometric fingerprinting. ALABAMA: Lawsuit Challenges Jefferson County's Huge Sewer Debt -------------------------------------------------------------- A class-action complaint filed on June 17, 2008, in the Circuit Court of Jefferson County, Alabama, alleges fraudulent bond deals left Jefferson County sewer customers owing $11,491 apiece, the highest debt in the nation, CourtHouse News Service reports. The defendants named in the suit: -- JP Morgan Chase & Co.; -- Morgan Keegan & Company Inc.; -- Regions Bank; -- Charles LeCroy; -- Douglas McFaddin; -- Goldman Sachs Specialty Lending Group LP; -- Bear Stearns Funding Inc.; -- Blount Parrish & Roton Inc; -- William Blount; -- Bank of America, National Association; -- Lehman Brothers Inc.; -- Gardner-Michael Capital Inc.; -- Larry Langford; Gary White; -- Steve Small; -- Bettye Fine Collins; -- Jeff Germany; -- Mary Buckalew; -- Sheila Smoot; -- Steve Saylor; -- CDR Financial Services Inc.; -- Financial Guaranty Insurance Co.; and -- XL Capital Assurance Inc. The genesis of this civil action can to be traced to the series of events over the last eleven to fifteen years where the Jefferson County Commissioners, various investment banks, insurers and advisors have continuously failed to act in the best interests of the citizens of Jefferson County. Plaintiffs claim ewer bills have risen more than threefold since 1997. Through a long series of ill-conceived financial transactions, the sewer ratepayers of Jefferson County have been saddled with a debt of roughly $11,491 per residential sewer customer, which is the highest in the nation. Also, the sewer ratepayers have seen exponential growth, an increase of 329%, in their sewer rates in the last eleven years. Plaintiffs want the court to rule on: (a) whether defendants, both named and fictitious, engaged in a combination and conspiracy among themselves to fix, maintain or stabilize prices, and rig bids and allocate customers and markets of Municipal derivatives; (b) whether defendants, both named and fictitious, failed to properly capitalize their portfolio of investments to ensure that the product and service that was offered to Jefferson County for the benefit of Plaintiffs could be delivered to ensure the protection for unforeseen events that was the intended benefit of the offered product and service; (c) whether defendants, both named and fictitious, failed to properly disclose the inherent risks of moving from fixed rate to floating and adjustable rate securities whether set by agreement or by auction; (d) whether defendants, both named and fictitious, exceeded their power, authority and scope of their elective office in saddling plaintiffs with a debt load of $11,491 per residential customer and increasing their sewer rates by 329% and depriving the taxpaying citizens of Jefferson County, Alabama, of funds which should have been dedicated to building and repairing the new sewer system in accordance with the terms and conditions of the settlement of the lawsuit brought by taxpayers of Jefferson County and the Environmental Protection Agency in 1996; (e) whether the rate increase of 7.7% in January 2008 and other prior rate increases that have led to a 329% increase in sewer rates and the insufficient funds to adequately replace and repair the sewer system due to the debt load can be attributed to the actions of all defendants, jointly and severally, in causing harm to plaintiffs; and (f) the appropriate class-wide measure of damages. Plaintiff asks the court to: -- determine that this action may be maintained as a class action under Rule 23 of the Alabama Rules of Civil Procedure; -- enter judgment for plaintiffs and class members against defendants for monetary damages sustained by plaintiffs as a result of the herein described wrongful conduct and actions between 1993 and 2008; -- enter judgment for plaintiffs and class members against defendants for the disgorgement of fees, kickbacks and premiums received by defendants as a result of their wrongful conduct and actions between 1993 and 2008; -- award injunctive relief against defendants and prevent future excessive fees from being paid and that this Court set-aside the transactions that are made the basis of this case as all were entered into in contravention of Alabama law; -- award injunctive relief in the form of the disgorgement of fees, kickbacks and premiums received by defendants as a result of the wrongful conduct and actions between 1993 and 2008; -- award the plaintiffs and the class interest at the highest legal rate available under law related to excessive fees and kickbacks; and -- award attorneys' fees. The suit is "Charles E. Wilson, et al. v. JPMorgan Chase & Co., et al.," filed in the Circuit Court of Jefferson County, Alabama. Representing the plaintiff is: Kathryn S. Harrington, Esq. Hollis, Wright & Harrington, PC 1500 Financial Center 505 North 20th Street Birmingham, AL 35203 Phone: 205-324-3600 205-324-3636 AMERICAN FLAME: Replaces Gas Valves Due to Fire, Explosion Risks ---------------------------------------------------------------- American Flame Inc., of Fort Wayne, Ind., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 12,000 fireplace gas valves. The company said the gas can continue to flow into the fireplace pilot light area after the switch has been turned "off," posing a fire or explosion hazard to consumers. American Flame has received two reports of incidents involving valve failure and continuous gas flow. No injuries or fires have been reported. The recall involves American Flame AF-4000 series fireplace gas valves installed in residential fireplaces made by twelve manufacturers under the following brand names: Pacific Energy, Travis Industries, CFM Corporation, Canadian Heating Products, Portland Willamette, Rasmussen, Chimeneas de Columbia, Twin Eagles, FDM, Inca Metals (Savannah Heating), Even Temp, and Valley Comfort. The valves were installed in some but not all fireplaces. Date codes included in the recall include 0622 through 0718. The gas valve model number is located on a label on the bottom of each gas valve. The date code is located above the label. These recalled gas valves were manufactured in Taiwan and were being sold by fireplace retailers and distributors nationwide from September 2006 through July 2007 for between $500 and $2,000 for the fireplaces, with additional costs for installation. Pictures of the recalled gas valves are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08277a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08277b.jpg Consumers should immediately stop using the recalled fireplaces and contact their dealer for a free repair. The repair involves replacing the fireplace's valve if it leaks gas in the "off" position when tested by a qualified service technician. For additional information, contact American Flame toll-free at 888-672-8929 between 9:00 a.m. and 5:00 p.m. ET to determine if your fireplace is included in the recall and to arrange for a free repair, or visit the firm's Web site at http://www.skytechsystem.com/ AMERICAN INTERNATIONAL: Bernstein Litowitz Files Securities Suit ---------------------------------------------------------------- Bernstein Litowitz Berger & Grossmann LLP filed a securities class action lawsuit against American International Group, Inc., and certain senior executives in the Southern District of New York on behalf of Ontario Teachers' Pension Plan Board and similarly situated investors in AIG securities during the period November 10, 2006, through June 6, 2008. The case was filed as a related action to Jacksonville Police and Fire Pension Fund v. American International Group, Inc., No. 08-CV-4772 (RJS), the first-filed securities class action in this matter, which is presently pending before the Honorable Richard J. Sullivan. Investors should note that the Ontario Teachers action expands the class period alleged in the Jacksonville action. All interested investors are directed to the notice published on May 22, 2008, in connection with the filing of the Jacksonville action pursuant to the Private Securities Litigation Reform Act of 1995. As set forth in that notice, investors wishing to serve as the lead plaintiff are required to file a motion for appointment as lead plaintiff by no later than July 21, 2008. The Complaint alleges that during the Class Period, AIG and the individual defendants -- former Chief Executive Officer Martin J. Sullivan, former 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 -- violated the federal securities laws by issuing false and misleading press releases, financial statements, filings with the SEC and statements during investor conference calls. As alleged in the Complaint, throughout the Class Period, Defendants overstated the Company's earnings and financial position while repeatedly reassuring investors that AIG had successfully insulated itself from the turmoil in the housing and credit markets due to its superior risk management. In particular, defendants touted the value and security of AIGFP's super senior credit default swap portfolio, making numerous statements that this portfolio was secure and that AIG's method for accounting for the valuations of this portfolio was proper. 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 a "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 linked to the subprime mortgage market. Then, 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. On June 6, 2008, the Company disclosed investigations by the Securities and Exchange Commission and the U.S. Department of Justice concerning AIG's accounting and financial disclosures with respect to its CDS portfolio. As a result of these disclosures, the price of AIG stock plunged from a Class Period high of $72.81 per share on December 18, 2006, to $33.93 per share on June 6, 2008, wiping out tens of billions of dollars in shareholder value and causing damage to the class. The Complaint asserts claims against all defendants under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, as well as claims against defendants Sullivan and Bensinger under Section 20(a) of the Exchange Act. This case is filed as a separate case from a preexisting securities class action in the Southern District of New York arising from allegations concerning undisclosed bid-rigging and improper reinsurance transactions. That action, filed in 2004 and presently pending before the Honorable John E. Sprizzo, is captioned "In re American International Group, Inc. Securities Litigation, No. 04-CV-8141 (JES) (AIG I)." The lead plaintiff in the older AIG I action has sought leave to amend the action to encompass the allegations and time period at issue in the Jacksonville and Ontario Teachers actions. Ontario Teachers, which has suffered significant financial losses as a result of the alleged wrongful conduct that is the subject of the Jacksonville and Ontario Teachers actions, believes that these actions are and should remain separate from the AIG I action and that the interests of class members would be prejudiced by the proposed amendment of the AIG I action. Ontario Teachers intends to oppose any effort to amend AIG I to subsume the new actions into the older case. Ontario Teachers is the largest single-profession pension plan in Canada, with over US$100 billion in assets. Ontario Teachers invests the pension fund's assets and administers the pensions of over 278,000 active and retired Ontario teachers. Ontario Teachers has significant experience serving as a lead plaintiff in securities class actions, including in "In re Nortel Networks Corporation Securities Litigation, No. 05-MD-1659 (LAP) (S.D.N.Y.)," in which a settlement worth over $1.3 billion was obtained for investors, and "In re Williams Securities Litigation, 02-CV-72 (N.D. Okla.)," which settled for $311 million shortly before trial. The Ontario Teachers action is being investigated and prosecuted by Bernstein Litowitz Berger & Grossmann LLP and its subprime litigation group. The subprime litigation group is also representing investors in class and derivative subprime-related actions against Washington Mutual, Inc., American Home Mortgage Investment Corp., New Century Financial Corporation, Countrywide Financial Corporation and State Street, among others. For more information, contact: Gerald H. Silk, Esq. Bernstein Litowitz Berger & Grossmann LLP 1285 Avenue of the Americas New York, NY 10019 Phone: 212-554-1400 AUSTRIAN GOV'T: EUR13.9-Mln Deal Reached in Cable Car Fire Case --------------------------------------------------------------- Austrian authorities announced that families of 155 people who died from a fire that raged through a crowded Alpine cable car in 2000 will share EUR13.9 million in compensation, The Associated Press relates. According to the report, the settlement, equivalent to about US$21.5 million, ends more than seven years of legal battle over the fire, which caused what is considered as the worst peacetime disaster in Austrian history. Klaus Liebscher, governor of the Austrian Central Bank and chairman of the compensation commission, told the AP that the money would be paid immediately. Mr. Liebscher said that a total of 451 claimants, who signed the settlement on June 12, will split the settlement amount. The cash amounts will vary according to a claimant's relation to the victim, he explained. Mr. Liebscher added that the agreement also stipulated that the relatives abandon any pending lawsuits seeking compensation. The report recounts that the victims died on Nov. 11, 2000, when a fire swept through a cable car that was packed with skiers and snowboarders. The authorities blamed a faulty heater for the blaze, which broke out as the car passed through a tunnel on its way to the summit of the Kitzsteinhorn glacier near the Austrian ski resort of Kaprun. Only 12 people escaped alive, the AP says. Most of the victims were from Austria and Germany, eight were from the United States and the others were from Japan, Slovenia, the Netherlands and Britain. According to the report, Austrian prosecutors charged 16 people with criminal negligence in the case, including employees of Gletscherbahnen Kaprun, which operated the cable car; employees of the company that manufactured the car; technicians; and two government officials. In February 2004, however, the court acquitted all 16. Eight were retried on appeal and again acquitted. At one point, the relatives of the victims tried to take the case to the European Court of Human Rights in Strasbourg, but the court refused to hear it, the AP further recalls. The AP notes that there was no immediate reaction from groups representing the victims and their families, which had sought higher damages in class-action lawsuits filed in Austria and the United States. In Europe, compensation in such cases is typically much lower than the multimillion-dollar settlements often awarded by U.S. courts, the report points out. But no sum could ever compensate families for the "infinite pain" of losing a loved one, the Austrian justice minister, Maria Berger, told the AP. "Nevertheless, it's important that after years of discussions, we are able to give survivors a tangible sign of our sympathy and respect," she said. The Austrian government, Gletscherbahnen Kaprun and the insurance company Generali paid into the compensation fund, officials said. BIG LOTS: Appeal on Calif. Labor Suit Deal Approval Dismissed ------------------------------------------------------------- An appeal by two individuals in connection with a final order approving a settlement reached in the labor class action lawsuit filed against Big Lots, Inc., has been dismissed, according to Big Lots' June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. In October 2005, a class action complaint was served on the company for adjudication in the Superior Court of the State of California, County of Ventura. The suit alleged that the company had violated certain California wage and hour laws. The plaintiff seeks to recover, on her own behalf and on behalf of all other individuals who are similarly situated, unpaid wages and rest and meal period compensation, as well as penalties, reasonable attorneys' fees and costs, injunctive and other equitable relief. In the third quarter of fiscal year 2006, the company and the plaintiff reached a tentative settlement of the California matter. On April 30, 2007, the court approved the deal on a final basis and entered a judgment of dismissal with prejudice. Two class members whose objections to the settlement were overruled by the court have appealed the final order to the California Court of Appeal, challenging the settlement. These two objectors also filed a separate putative class action suit in the U.S. District Court for the Northern District of California, alleging the same class claims that were tentatively settled through the California matter. The federal court stayed the federal action pending resolution of the appeal before the California Court of Appeal. The objectors recently dismissed the federal action with prejudice. The objectors also recently dismissed the appeal. The parties are awaiting the Court of Appeal's final remittitur of the case to the trial court. Big Lots, Inc. -- http://www.biglots.com/-- is a national broadline closeout retailer. As of Feb. 3, 2007, the Company operated a total of 1,375 stores in 47 states. Big Lots, Inc.'s merchandising categories include Consumables, Home, Seasonal and Toys, and Other. BIG LOTS: La. Court Considers Arguments in FLSA Violations Suit --------------------------------------------------------------- The U.S. District Court for the Eastern District of Louisiana has yet to issue a decision in the matter, "Johnson, et al. v. Big Lots Stores, Inc., Case No. 2:04-cv-03201-SSV-SS," which alleged violations of the Fair Labor Standards Act, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. The civil putative collective action complaint was filed on November 2004 against the company in the U.S. District Court for the Eastern District of Louisiana. It alleges that the company violated FLSA by misclassifying assistant managers as exempt. The plaintiffs seek to recover, on behalf of themselves and all other individuals who are similarly situated, unpaid overtime compensation, as well as liquidated damages, attorneys' fees and costs. On July 5, 2005, the court issued an order conditionally certifying a class of all current and former assistant store managers who have worked for the company since Nov. 23, 2001. As a result of that order, notice of the lawsuit was sent to approximately 5,500 individuals who had the right to opt-in to the Louisiana matter. As of Nov. 3, 2007, approximately 1,100 individuals had joined the Louisiana matter. The company filed a motion to decertify the class and the motion was denied on Aug. 24, 2007. The trial began on May 7, 2008, and concluded on May 15, 2008. A decision has yet to be issued. The suit is "Johnson, et al. v. Big Lots Stores, Inc., Case No. 2:04-cv-03201-SSV-SS," filed with the U.S. District Court for the Eastern District of Louisiana, Judge Sarah S. Vance, presiding. Representing the plaintiffs is: Philip Bohrer, Esq. (phil@bohrerlaw.com) Bohrer Law Firm 8712 Jefferson Hwy, Suite B Baton Rouge, LA 70809 Phone: 225-925-5297 Representing the defendant is: Dominic J. Ovella, Esq. (dovella@hmhlp.com) Hailey, McNamara, Hall, Larmann & Papale One Galleria Blvd., P.O. Box 8288, Suite 1400 Metairie, LA 70011-8288 Phone: 504-836-6500 BIG LOTS: Calif. Court Mulls Certification of Workers' Lawsuit -------------------------------------------------------------- The Superior Court of the State of California, County of Los Angeles, has yet to certify a class or set a trial date for a purported class action lawsuit against Big Lots Inc., alleging that the company violated certain California wage and hour laws by misclassifying California store managers as exempt employees. The purported class action complaint was filed in September 2006. In it, the plaintiff seeks to recover, on his own behalf and on behalf of all other individuals who are similarly situated, damages for alleged unpaid overtime, unpaid minimum wages, wages not paid upon termination, improper wage statements, missed rest breaks, missed meal periods, reimbursement of expenses, loss of unused vacation time, and attorneys' fees and costs. The court has not yet determined whether the case may proceed as a class action, and has not set any deadlines for class certification or trial, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Big Lots, Inc. -- http://www.biglots.com-- is a national broadline closeout retailer. As of Feb. 3, 2007, the Company operated a total of 1,375 stores in 47 states. Big Lots, Inc.�s merchandising categories include Consumables, Home, Seasonal and Toys, and Other. BIG LOTS: Seeks Stay for Calif. Suits Over Client Info. Request --------------------------------------------------------------- Big Lots, Inc., asks the court to stay two purported class action lawsuits filed against it in California, alleging that it violated state law by requesting certain customer information in connection with the return of merchandise for which the customer sought to receive a refund to a credit card. The two class-action complaints were filed in May 2007 against the company. One was filed in the Superior Court of the State of California, County of Orange (Stary matter), and the other was filed in the Superior Court of the State of California, County of San Diego (Christopher matter). Both suits alleged that the company had violated California law by requesting certain customer information in connection with the return of merchandise for which the customer sought to receive a refund to a credit card. The plaintiffs seek to recover, on their own behalf and on behalf of all other individuals who are similarly situated, statutory penalties, costs and attorneys' fees and seek injunctive relief. The company believes that substantially all of the purported class members of the Christopher matter are within the purported class of the Stary matter. The Stary matter has been transferred to the Superior Court of the State of California, County of San Diego, where it will be coordinated with the Christopher matter before the same judge. Both matters were stayed pending the ruling of the California Court of Appeals, Fourth Appellate Division Three in a similar case involving another retailer. The appellate court recently ruled in favor of the other retailer, holding that the California law at issue does not apply to merchandise return transactions. After the opinion in that matter becomes final and the remittitur issues, which may not occur for some time, the company anticipate seeking the dismissal of the Stary and Christopher matters based on the appellate court ruling. In the interim, the company will request that both matters remain stayed pending finality and the remittitur issuing, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Big Lots, Inc. -- http://www.biglots.com/-- is a national broadline closeout retailer. As of Feb. 3, 2007, the Company operated a total of 1,375 stores in 47 states. Big Lots, Inc.'s merchandising categories include Consumables, Home, Seasonal and Toys, and Other. BIG LOTS INC: Seeks Consolidation of Calif. Workers' Wage Cases --------------------------------------------------------------- Big Lots, Inc., is seeking either the coordination or consolidation of several purported class action lawsuits filed against the company in California, asserting various wage and hour claims. In February 2008, three alleged class action complaints were filed against the company by a California resident. The first was filed before the Superior Court of California, Orange County, alleging that the company violated certain California wage and hour laws by misclassifying California store managers as exempt employees. The second and third matters, filed before the U.S. District Court, Central District of California, and the Superior Court of California, Riverside County, respectively, allege that the company violated certain California wage and hour laws for missed meal and rest periods and other wage and hour claims. The plaintiff seeks to recover, on her own behalf and on behalf of a California statewide class of all other individuals who are similarly situated, damages resulting from improper wage statements, missed rest breaks, missed meal periods, non-payment of wages at termination, reimbursement of expenses, loss of unused vacation time, and attorneys' fees and costs. The company believes that these matters overlap and it intends to transfer venue and to consolidate them before one court, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Big Lots, Inc. -- http://www.biglots.com/-- is a national broadline closeout retailer. As of Feb. 3, 2007, the Company operated a total of 1,375 stores in 47 states. Big Lots, Inc.'s merchandising categories include Consumables, Home, Seasonal and Toys, and Other. BROWN SHOE: High Court Denies Retrial Request in Redfield Suit -------------------------------------------------------------- The Supreme Court of Colorado denied a request that sought a review of the decision denying a new trial for a class action lawsuit filed against Brown Shoe Co., Inc., in connection with the company's operations at its Redfield, Colorado site. The suit was filed in March 2000 alleging claims for trespass, nuisance, strict liability, unjust enrichment, negligence, and exemplary damages arising from the alleged release of solvents contaminating the groundwater and indoor air in the areas adjacent to and near the site. In December 2003, the jury hearing the claims returned a verdict finding the company's subsidiary negligent and awarded the class plaintiffs $1.0 million in damages. The company recorded this award along with estimated pretrial interest on the award and estimated costs related to sanctions imposed by the court related to a pretrial discovery dispute between the parties. The total pretax charge recorded for these matters in 2003 was $3.1 million. The company recorded an additional $0.6 million in expense in 2004, related to pretrial interest, to reflect the trial court's ruling extending the time period for which prejudgment interest applied. The plaintiffs filed an appeal of the December 2003 jury verdict, and in August 2007, the Colorado Court of Appeals rejected the plaintiffs' attempt to obtain a new trial by affirming the trial court judgment. The Court also denied a cross-appeal by the company seeking a reversal of a portion of the pretrial interest awarded to the plaintiffs, and the company paid an additional $0.8 million in April 2008 for the remainder of the pretrial interest owing on the judgment. In addition, the Court reversed the trial court's award of costs to the company and remanded the case to the trial court for a determination of whether plaintiffs are entitled to recover their costs related to the trial. The plaintiffs subsequently filed a petition with the Supreme Court of Colorado seeking review of the Court of Appeal's decision denying them a new trial, which appeal was then denied the Supreme Court on May 19, 2008, effectively ending the plaintiffs' attempts to obtain a retrial, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Brown Shoe Co., Inc. -- http://www.brownshoe.com/-- operates in the footwear industry. The Company's activities include the operation of retail shoe stores, and the sourcing and marketing of footwear for women, men and children. It operates in two segments: Retail Operations and Wholesale Operations. BUSH HOG: Recalls Off-Road UVs Due to Loss of Speed Control ----------------------------------------------------------- Bush Hog LLC, of Selma, Ala., in cooperation with the U.S. Product Safety Commission, is recalling about 4,000 Bush Hog Off-Road Utility Vehicles. The company said the utility vehicle's throttle cable can freeze in freezing temperatures. This can cause the engine not to return to idle when the driver takes his or her foot off the accelerator pedal. Bush Hog has received 52 reports of incidents involving the utility vehicle, including one leg fracture injury. The recall includes the Bush Hog Models: -- TH440 (Trail Hunter), -- TH4200 (Trail Hand) and -- TH4400 (Trail Hand) Off-Road Utility Vehicles. "Bush Hog" is printed on the utility vehicle's cargo bed tail gate and on each side of the cargo bed. Model "TH440," "TH4200," or "TH4400" is printed on each side of the hood. The hood color is red, green, or mossy oak. These recalled off-road utility vehicles were manufactured in the United States and were being sold by Bush Hog dealerships nationwide from January 2004 through March 2008 for between $8,000 and $9,900. Pictures of the recalled off-road utility vehicles are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08586a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08586b.jpg Consumers are advised to immediately stop using the recalled off-road utility vehicles and contact a Bush Hog dealer to schedule a free inspection and repair. All registered owners have been notified about this recall by mail. For additional information, contact Bush Hog LLC toll-free at 877-873-0143 between 8:00 a.m. and 4:00 p.m. CT Monday through Friday, or visit the firm's Web site: http://www.bushhog.com/ CAPE & ISLANDS: ACLU Launches Suit Over Worthington DNA Testing --------------------------------------------------------------- The American Civil Liberties Union has filed a class action lawsuit on behalf of men who voluntarily gave DNA samples in the Christa Worthington murder probe, Cape Cod Today reports. According to Cape Cod Today, the lawsuit claims that Cape & Islands District Attorney Michael O'Keefe failed to make good on a promise to either return the samples or destroy them after the case was resolved. The report recounts that Christopher McCowen was convicted in the 2002 murder of the fashion writer in her Truro home. CARDINAL HEALTH: Patients Sue Over Contaminated Surgical Tools -------------------------------------------------------------- Surgical patients in North Carolina have filed a class-action lawsuit against Cardinal Health and cleaning-materials company Steris Corp. in connection with the contamination of surgical instruments at Duke University hospitals in 2004, Columbus Dispatch reports. According to Columbus Dispatch, the Dublin-based health services company is alleged to have sold barrels containing used hydraulic fluid but marked as cleaning fluid to two hospitals at Duke University in 2004. For two months, surgeons at the hospitals operated on 4,000 patients not knowing that their instruments had been washed with waste hydraulic fluid instead of soap. The report relates that the lawsuit against Cardinal Health and Steris represents 67 patients and their spouses. It alleges that the barrels had once contained the cleaning products but had been filled with the waste fluid by an elevator company doing work at one of the hospitals. The plaintiffs are seeking more than $30,000 in damages, and their spouses are seeking $10,000 in damages, according to the suit filed in Durham County, N.C., Superior Court. Officials of Dublin-based Cardinal declined to comment, Columbus Dispatch says. CSX CORP: Fla. Suit Claims Directors Breached Fiduciary Duties -------------------------------------------------------------- CSX Corp. is facing a class-action complaint filed in the Circuit Court of the Fourth Judicial Circuit of the State of Florida, in and for Duval County, alleging the company and its directors breached fiduciary duties in deceitful proxy statements that restrict, rather than increase, shareholders' rights to elect and replace CSX directors, the CourtHouse News Service reports. The plaintiff brings this action as a class action pursuant to Florida Rule of Civil Procedure 1.220 on behalf of all common stockholders of the company. The plaintiff wants the court to rule on: (a) whether defendants made misrepresentations to the class in violation of their fiduciary duties; (b) whether plaintiff and the other members of the class would suffer harm if they are deprived of their right to complete, fair and accurate information regarding the issues to be voted on at the 2008 shareholder meeting; and (c) whether the class is entitled to injunctive relief as a result of the wrongful conduct committed by defendants. The plaintiff asks the court to enter an order: -- granting appropriate equitable relief to remedy defendants' breaches of fiduciary duties; -- directing defendants to cure the material misstatements and omissions; -- awarding to plaintiff the costs and disbursements of the action, including reasonable attorneys' fees, accountants' and experts' fees, costs, and expenses; and -- granting such and further relief as the court deems just and proper. The suit is "Louis Steger, et al. v. Michael J. Ward, et al., Case No. 2008-CA-007230," filed in the Circuit Court of the Fourth Judicial Circuit of the State of Florida. Representing the plaintiff is: Chris A. Barker, Esq. (cbarker@barkerrodemsandcook.com) Barker, Rodems & Cook, PA 400 N. Ashley Dr., Suite 2100 Tampa, FL 33602 Phone: 813-486-1001 Fax: 813-489-1008 ESTYLE INC: Recalls Toy Kitchens Posing Choking, Tip-Over Risks --------------------------------------------------------------- eStyle Inc., of Los Angeles, California, in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 65 Mini Chef Complete Toy Kitchens. The company said the four pegs supporting the oven shelf and four pegs supporting the refrigerator shelf can pull out of the wood, posing a choking hazard to children. The toy kitchen unit also can tip over, posing a risk of serious injury to children. eStyle has received one report of a toddler placing a peg in his mouth. No injuries have been reported. The Mini Chef Complete Kitchen is a wooden unit with a metal sink, faucet, four burner stove with front oven and five turn knob control panel, refrigerator, shelves, phone, clock, microwave door and roof. The recalled toy kitchen is approximately 32 inches by 43 inches. These recalled mini toy kitchens were manufactured in Thailand and were being sold exclusively at Babystyle stores nationwide and at http://www.babystyle.com/from October 2007 through November 2007 for about $200. A picture of the recalled mini toy kitchens is found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08582.jpg Consumers are advised to immediately stop using the recalled product and contact the firm for a store credit. All known users have been contacted. For additional information, contact the firm at 877-378-9537 between 7:00 a.m. and 4:00 p.m. PT Monday through Friday or visit http://www.babystyle.com/ FREDERICK'S OF HOLLYWOOD: Settles Calif. Consumer Privacy Suit -------------------------------------------------------------- Frederick's of Hollywood, Inc., and its subsidiary, Frederick's of Hollywood Stores, Inc., settled a purported class action lawsuit filed against them before the Superior Court of California, County of Los Angeles, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended April 26, 2008. The suit was filed on Oct. 12, 2006 by Dennis Luciani. It alleged that Frederick's of Hollywood violated certain California consumer privacy laws in requesting cardholders' telephone numbers during credit card refund transactions and recording such telephone numbers onto a form. The plaintiff requested certification of the lawsuit as a class action, and sought statutory civil penalties and attorneys' fees, among other things. Frederick's of Hollywood filed an answer denying the plaintiff's claims and asserting various defenses. In order to mitigate the cost of litigation, the plaintiff, Frederick's of Hollywood and Frederick's of Hollywood Stores entered into a settlement agreement for the named plaintiff and the purported class, which was granted final approval by the Court on October 2, 2007. Pursuant to the settlement agreement, Frederick's of Hollywood: -- paid $2,500 to the class representative, -- paid $150,000 in attorneys' fees to the plaintiff's attorneys, -- provided each class member who filed a claim form with a certificate good for a certain amount off of future products purchased from Frederick's of Hollywood stores, -- agreed to adopt a policy not to request personal identification information from customers in all California Frederick's of Hollywood stores in conjunction with the processing of returns for credit card refunds, and -- agreed to bear the costs of implementing the settlement, including the costs of providing notice to potential class members and of retaining a claims administrator. The case was dismissed with prejudice pursuant to the settlement agreement on Dec. 14, 2007. New York, New York-based Frederick's of Hollywood Group Inc. -- http://www.moviestarinc.com-- formerly Movie Star, Inc., designs, manufactures (through independent contractors), imports, markets and distributes a line of women's intimate apparel to mass merchandisers, specialty and department stores, discount retailers, national and regional chains, and direct mail catalog marketers throughout the U.S. The Company's products include pajamas, nightgowns, baby dolls, nightshirts, dusters, shifts, caftans, sundresses, rompers, short sets, beachwear, peignoir ensembles, robes, leisurewear, panties and daywear consisting of bodysuits, soft bras, slips, half-slips, teddies, camisoles and cami tap sets. These products are manufactured in various fabrics, designs, colors and styles depending upon seasonal requirements, changes in fashion and customer demand. GENERAL MOTORS: Court Upholds Class Status of Truck Brake Suit -------------------------------------------------------------- Arkansas' highest court upheld the class-action status of a lawsuit filed against General Motors Corp. that alleges the company sold 4 million trucks and sport utility vehicles with defectively designed parking brakes, The Associated Press reports. According to the AP report, justices agreed with a Miller County Circuit judge's decision to grant class certification to Boyd Bryant, who filed the lawsuit against GM in September 2006. Mr. Bryant sued the company over vehicles manufactured from 1999 through 2002. Mr. Bryant claimed that the company discovered the defect in late 2000, redesigned the brake defect in October 2001 and withheld from dealers admission of responsibility for the defect until Jan. 28, 2003. He accused the automaker of avoiding paying millions of dollars in warranty claims. The AP recounts that GM appealed the lower court's ruling, claiming that the difference in motor vehicle product defect laws among the states prohibited giving the lawsuit class-action status. GM also argued that the class definition in the case was overbroad and unclear, saying the definition failed to distinguish between "owners" and "subsequent owners." However, Associate Justice Paul Danielson wrote in the court's ruling, "We simply cannot say that the class definition is in any way overbroad. Nor do any individual issues among potential class members raised by General Motors render the definition imprecise." GENESCO INC: Faces Consolidated Securities Fraud Suit in Tenn. -------------------------------------------------------------- Genesco, Inc., is facing a consolidated securities fraud lawsuit filed in the U.S. District Court for the Middle District of Tennessee. Roeglin Litigation On Dec. 5, 2007, a class-action complaint, entitled "Roeglin v. Genesco Inc., et al.," was filed against the company and four of its officers before the U.S. District Court for the Middle District of Tennessee, alleging violations of the federal securities laws on behalf of all purchasers of the company's common stock between April 20 and Nov. 26, 2007. The complaint alleges that the defendants violated federal securities laws by making false and misleading statements about the company's business during that period. It seeks unspecified damages and interest, costs and attorneys' fees and other relief. Koshti Litigation On Dec. 13, 2007, a second class-action complaint, entitled "Koshti v. Genesco Inc., et al.," was filed in the U.S. District Court for the Middle District of Tennessee, alleging violations of the federal securities laws on behalf of all purchasers of the company's common stock between April 20 and Nov. 26, 2007. The complaint, which was filed against the company and three of its officers, also alleges that the defendants violated federal securities laws by failing to disclose material adverse facts about the company's financial well being and prospects during the class period. It seeks unspecified damages and interest, costs and attorneys' fees and other relief. Consolidation On Jan. 22, 2008, the U.S. District Court entered a stipulation and order consolidating the Koshti case with the Roeglin case, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. The suit is "Roeglin v. Genesco Inc., et al., Case No. 3:2007- cv-01183," filed before the U.S. District Court for the Middle District of Tennessee, Judge William J. Haynes, Jr., presiding. Representing the plaintiffs are: A. Rick Atwood, Esq. (ricka@lerachlaw.com) Coughlin, Stoia, Geller, Rudman & Robbins, LLP 655 W. Broadway, Suite 1900 San Diego, CA 92101 Phone: 619-231-1058 George Edward Barrett, Esq. (gbarrett@barrettjohnston.com) Barrett, Johnston & Parsley 217 Second Avenue, N Nashville, TN 37201 Phone: 615-244-2202 - and - Paul Kent Bramlett, Esq. (pknashlaw@aol.com) Bramlett Law Offices P.O. Box 150734 Nashville, TN 37215 Phone: 615-248-2828 Fax: 615-254-4116 Representing the defendants is: Britt K. Latham, Esq. (blatham@bassberry.com) Bass, Berry & Sims AmSouth Center 315 Deaderick Street, Suite 2700 Nashville, TN 37238-3001 Phone: 615-742-6200 GENESCO INC: Plaintiffs Dismiss "Falzone" Lawsuit in New York ------------------------------------------------------------- The plaintiffs in the matter, "Falzone v. Genesco Inc., et al., Case No. 1:2007-cv-11146," are voluntarily dismissing the case, which was filed against Genesco, Inc., according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. The suit was filed against Genesco and its officers befor the U.S. District Court for the Southern District of New York on Dec. 11, 2007, alleging violations of the federal securities laws on behalf of all purchasers of the company's common stock between May 31 and Nov. 16, 2007. The suit also asserted that the defendants violated federal securities laws by making false and misleading statements about the Company's business during that period. It sought unspecified damages and interest, costs and attorneys' fees and other relief. On Feb. 5, 2008, the plaintiffs filed a Stipulation and Order of Discontinuance Without Prejudice dismissing the case in light of the earlier filed cases in Tennessee, one of which is under the caption, "Roeglin v. Genesco Inc., et al., Case No. 3:2007-cv- 01183." Genesco, Inc. -- http://www.genesco.com/-- is a retailer of branded footwear, licensed and branded headwear, and a wholesaler of branded footwear. GENESCO INC: Tenn. Court Dismisses Suit Over Foot Locker Offer -------------------------------------------------------------- The Tennessee Chancery Court issued an order dismissing without prejudice the suit captioned, "Phillips v. Genesco Inc., et al.," which involved a proposal by Foot Locker, Inc., to acquire Genesco, Inc. The suit was filed by Maxine Phillips on April 24, 2007, and generally alleges, among other things, that the individual defendants -- directors of the company -- refused to consider properly the proposal. The complaint seeks class certification, a declaration that defendants have breached their fiduciary and other duties, an order requiring defendants to implement a process to obtain the highest possible price for shareholders' shares, and an award of costs and attorneys' fees. Following the execution of the merger agreement with The Finish Line Inc., the plaintiff's counsel indicated, and continues to indicate, that the plaintiff intends to file an amended complaint alleging breach of fiduciary duties by the individual defendants in connection with the board of directors' approval of the merger agreement and the disclosures made in the preliminary proxy statement related to the merger and seeking injunctive relief. On April 28, 2008, the court entered an order dismissing the case without prejudice for failure to prosecute, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Genesco Inc. -- http://www.genesco.com/-- is a retailer of branded footwear, licensed and branded headwear, and a wholesaler of branded footwear. GENESCO INC: Settles California Labor Code Violations Lawsuit ------------------------------------------------------------- Genesco, Inc., and its subsidiary, Hat World, Inc., settled a purported class action lawsuit alleging violations of the California Labor Code, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. On May 18, 2006, a former employee filed the putative class, representative and private attorney general action alleging violations of the Labor Code in the Superior Court of California, Alameda County, seeking statutory penalties, damages, restitution, and injunctive relief. On Feb. 21, 2007, the court granted leave for the plaintiff to file an amended complaint adding the company's wholly owned subsidiary, Hat World, as a defendant. On April 15, 2008, the parties reached an agreement to settle the matter pursuant to which the company will pay a minimum of $750,000 and a maximum of $1,025,408, depending upon the number of verified claims submitted by class members. The settlement is subject to definitive documentation and approval by the court. Genesco Inc. -- http://www.genesco.com/-- is a retailer of branded footwear, licensed and branded headwear, and a wholesaler of branded footwear. GENESCO INC: Faces Calif. Suit Over Customer E-mail Addresses ------------------------------------------------------------- Genesco, Inc., is facing a purported class action lawsuit alleging violations of the Song-Beverly Credit Card Act of 1971, California Civil Code Section 1747.08, related to requests that customers in the company's California retail stores voluntarily provide the company with their e-mail addresses. The suit was filed before the Superior Court of California, San Diego County on April 8, 2008. The company has filed an answer to the complaint consisting of a general denial of its allegations and asserting a number of affirmative defenses and is presently unable to predict whether or to what extent it may have liability in the case, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. Genesco Inc. -- http://www.genesco.com/-- is a retailer of branded footwear, licensed and branded headwear, and a wholesaler of branded footwear. MEDICARE LITIGATION: Nationwide Prescription Drug Case Settled -------------------------------------------------------------- Pursuant to a settlement agreement filed in federal court in the Medicare Part D class action lawsuit "Situ v. Leavitt," the Bush administration has agreed to make significant changes to its administration of the prescription drug benefit for low-income beneficiaries. If approved by the judge, the agreement will make it easier for seniors and individuals with disabilities to access the full benefits of the Medicare Part D program and the Low Income Subsidy. The case was filed against Michael Leavitt, Secretary of the Department of Health and Human Services, by the National Senior Citizens Law Center and the Center for Medicare Advocacy in April 2006 and was certified as a nationwide class action in January 2007. Pro bono counsel from the law firm of Wilson Sonsini Goodrich & Rosati later joined the plaintiff team. Plaintiffs argued that the Bush Administration failed to provide sufficient protections for low- income senior citizens and persons with disabilities in developing the Medicare Part D enrollment and low income subsidy deeming system. The case was brought on behalf of 6.2 million low-income "dual eligible" Medicare beneficiaries, who also receive Medicaid. Dually eligible beneficiaries are elderly and disabled and very poor. The settlement addresses chronic problems related to information management in the Medicare Part D program. Plaintiffs argued that poor management created ongoing barriers for low-income people struggling to obtain prescription medications. Dual eligibles rely on an average of ten more prescriptions per month than other Medicare beneficiaries. These beneficiaries receive a Low-Income Subsidy, which entitles them to purchase prescription medication for a nominal charge, and are automatically enrolled into a Part D plan. "This settlement agreement is a victory for many of our nation's most vulnerable citizens," said National Senior Citizens Law Center Staff Attorney Kevin Prindiville. "These individuals have faced life-threatening delays in receiving vital medication. They do not have the means to front the costs of their prescription drugs while Medicare and the plans sort out paperwork. We view the administration's agreement to this settlement as a sign that it is now committed to providing adequate protections for these beneficiaries." The information management system that notifies pharmacies of the enrollment and low-income status of dual eligibles has been dogged by extensive delays when enrollees join the system or change drug plans. In addition to voluntary plan changes, a large proportion of beneficiaries have been forced to change plans each year due to ongoing shifts in available coverage. The system is dauntingly complex for beneficiaries and pervasive flaws have left many in this vulnerable population with gaps in coverage of essential medication while technical issues are resolved among the Centers for Medicare and Medicaid Services (CMS, the federal agency responsible for administering the Medicare program), state governments, pharmacies and drug plans. In exchange for the plaintiff's dismissal of their claims against the Secretary, CMS agreed to make a number of changes that will streamline the Medicare Part D enrollment process. The agency will: -- Speed up the enrollment process for new dual eligibles. Instead of waiting several weeks to process files received from states identifying new dual eligibles, CMS will process these files within one business day of receipt. CMS will also allow states to submit these files more frequently. -- Require plans and CMS Regional Offices to provide additional assistance to beneficiaries whose names are inadvertently missing from pharmacy or plan computer systems. New protocols will shift the burden of proof away from beneficiaries and to providers when eligibility is in question. -- Educate pharmacy organizations about new policies intended to increase protections for dual eligibles who are not automatically enrolled in a plan and, therefore, are unable to obtain medications. "We're anxious to see CMS successfully implement the changes outlined in the agreement," said Gill Deford, Director of Litigation at the Center for Medicare Advocacy. "CMS has taken the first step by agreeing to do more on behalf of low-income recipients. We look forward to working with agency staff to ensure that these improvements are integrated into its standard business practices." The settlement agreement does not prevent individual class beneficiaries from filing separate claims for individual benefits. Under the terms of the agreement, the court will retain jurisdiction over implementation of the agreement for up to three years, during which time the plaintiffs will monitor CMS activities to ensure the remedies are fully realized. The agreement must be approved by the presiding judge in the case, the Honorable Thelton E. Henderson, in order to take effect. Wilson Sonsini Goodrich & Rosati joined the plaintiff team in June 2007. Pro bono counsel from the firm played an integral role in developing the final settlement agreement. MEDIS TECH: Court Still to Rule on Securities Suit Dismissal Bid ---------------------------------------------------------------- The U.S. District Court for the Southern District of New York has yet to rule Medis Technologies, Ltd.'s motion seeking the dismissal of a securities fraud class action suit. The suit was filed on April 23, 2007, against the company and, among others, the company's chief executive officer. The complaint alleges that the company issued a false and misleading press release on April 13, 2007 regarding sales of the company's "24/7" fuel cell power packs to a major international company by overstating the importance of those sales, which resulted in the company's common stock being artificially inflated. The complaint seeks relief under Rule 10b-5 against all defendants, and under Section 20(a) of the Securities Exchange Act of 1934 against, among others, the Company's Chief Executive Officer. Thereafter, on Sept. 10, 2007, the plaintiffs filed the First Amended Class Action Complaint, which essentially alleges that defendants violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934 by issuing a false and misleading press release on April 13, 2007, stating that the company had begun "commercial sales" of "Microsoft-Branded" Power Packs to Microsoft. The announcement is alleged to have caused a temporary fluctuation in the stock price, causing the stock to trade from $18.29 to as high as $24.10 per share before closing at $20.32 per share. The plaintiffs allege that the April 13 Press Release was misleading because it failed to specifically state that the sale to Microsoft was for a small quantity and that Microsoft intended to use the Power Packs as give-aways. Moreover, plaintiffs allege, the units were not Microsoft branded. However, the April 13 Press Release explicitly conveyed the landmark importance of the sale to us and the fuel cell industry, and the company has vigorously denied any allegations of wrongdoing, standing by the truth of the April 13 Press Release. The plaintiffs' putative class includes those who "purchased the common stock, call options, and/or sold put options of Medis for the time period April 13, 2007 through April 17, 2007." Discovery was stayed as per the Private Securities Litigation Reform Act, and on Nov. 20, 2007, defendants filed a Motion to Dismiss the Amended Complaint, arguing that the First Amended Complaint failed as a matter of law because it did not allege "scienter," i.e., that defendants acted with a culpable intent. The defendants argued, among other things, that plaintiffs could not allege any reason why the defendants would seek to temporarily inflate the Company's stock price. The plaintiffs opposed the Motion to Dismiss on Jan. 28, 2008, arguing, among other things, that scienter was properly pled because defendants knew or should have known that they were misrepresenting material facts. The plaintiffs further asked the Court for permission to cross move to strike certain exhibits relied on by defendants and to convert the Motion to Dismiss into one for summary judgment, lifting the stay of discovery. The Court denied the plaintiffs' request, stating that it would consider those issues in due course when it ruled on the Motion to Dismiss. The defendants' reply papers on the Motion to Dismiss were filed on April, 24, 2008. The Motion to Dismiss is fully briefed, 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 "Kou v. Medis Technologies, Ltd., et al., Case No. 1:07-cv-03230-PAC," filed in the U.S. District Court for the Southern District of New York, Judge Paul A. Crotty, presiding. Representing the plaintiff is: Phillip C. Kim, Esq. (pkim@rosenlegal.com) The Rosen Law Firm, P.A. 350 Fifth Avenue, Suite 5508 New York, NY 10118 Phone: 212-686-1060 Fax: 212-202-3827 MERRILL LYNCH: Faces Ohio Suit Over Document Preparation Fees ------------------------------------------------------------- Merrill Lynch Credit Corp. is facing a class-action complaint filed in the Court of Common Pleas, Cuyahoga County, Ohio, alleging it charges document preparation fees for work that is not done by attorneys, which is illegal in Ohio, CourtHouse News Service reports. Plaintiff brings this class action suit to recover document preparation fees charged for services performed by clerical personnel preparing or completing legal documents relating to the issuance of mortgage loans. According to the complaint, Merrill Lynch routinely charges customers a document preparation fee in the sum of approximately $150 for services performed by non-lawyers in preparing legal documents relating to the issuance of mortgage loans, including, without limitation, promissory notes, mortgages, deeds or documents incorporated therein, even though Ohio law prohibits Merrill Lynch from charging fees for such legal services performed by non-attorneys. Plaintiff brings this action on behalf of all persons in the State of Ohio who were charged a fee for the preparation of documents that was paid to Merrill Lynch in connection with a loan at any time after six years preceding the filing of this action and before Sept. 15, 2004. Plaintiff wants the court to rule on: (a) whether Merrill Lynch charged a document preparation fee in connection with the preparation of legal documents relating to mortgage loans; (b) whether the agents or employees of Merrill Lynch who prepared the legal documents relating to such mortgage loans were not licensed to practice law; (c) whether the document preparation fee charged by Merrill Lynch for services performed by non attorneys in preparing such legal documents is prohibited by Ohio law; (d) whether Merrill Lynch should not be allowed to retain the money it received from the plaintiff and class members for such improper document preparation fees; (e) whether Merrill Lynch has been unjustly enriched through improper document preparation fees charged to the plaintiff and class members; and (f) the nature of the damages and other relief to which the plaintiff and class members are entitled as a remedy for Merrill Lynch's improper practices that are the subject of this action. Plaintiff requests that the court enter judgment ordering the defendant to disgorge the amounts by which it has been unjustly enriched by charging improper document preparation fees, and refund such amounts to the plaintiff and the class, together with prejudgment interest thereon as provided by law, and awarding attorneys' fees, the costs of this action, and such other relief as may be proper. The suit is "Steven Romanoff, et al. v. Merrill Lynch Credit Corp., Case No. CV 08 662306," filed in the Court of Common Pleas, Cuyahoga County, Ohio. Representing the plaintiff is: Mark Schlachet, Esq. 1700 North Point Tower 1001 Lakeside Avenue Cleveland, OH 44114 Phone: 216-696-5248 Fax: 216-696-5288 MITSUBISHI MOTORS: Faces California Lawsuit Over Peeling Paint -------------------------------------------------------------- Mitsubishi Motors North America, Inc., is facing a class-action complaint filed in the U.S. District Court for the Central District of California alleging paint on Mitsubishi model 2000- 2008 autos peels, fades and becomes discolored, CourtHouse News Service reports. Named plaintiff Pete Vizzi brings this action for money damages, injunctive, equitable, and declarative relief on behalf of all current and original owners or lessees of 2000-2008 Mitsubishi automobiles in the United States outfitted with the manufacturer's original paint. Public record demonstrates that, due to a defect in the paint of these Mitsubishi vehicles, they are prone to and do experience paint peeling and fading at rates and in a manner that does not conform to the industry standard. The plaintiff wants the court to rule on: (a) whether defendant is responsible for injunctive allegedly defective vehicles in the United States' stream of commerce; (b) whether the 2000-2008 model year Mitsubishi automobiles are unduly prone to experience paint peeling, fading or discoloration; (c) whether the 2000-2008 model year Mitsubishi vehicles or their factory-original paint are defective, and if so, the nature of the defect; (d) whether defendant breached any duty imposed upon it by law; (e) whether defendant fraudulently concealed any defect or breach of its duty to the members of the putative class; and (f) whether class members are entitled to the relief sought, and if so, the proper scope of such relief. The plaintiff asks the court: -- to determine that this action may be litigated as a class action, and that plaintiff and his counsel be appointed class representative and class counsel, respectively; -- that the defendant be permanently enjoined from continuing in any manner the violations alleged; -- enter judgment against defendant and in favor of plaintiff and the class members on all counts; -- to require defendant to create an equitable fund to be made available to remedy the defects alleged, and to order defendant to bear the cost of notifying the absent class members as to the availability of this fund to remedy the defects alleged; and -- to award plaintiff and the class members all such other relief as the court deems just and proper. The suit is "Pete Vizzi, et al. v. Mitsubishi Motors North America, Inc., Case No. SACV08-650 JVS," filed in the U.S. District Court for the Central District of California. Representing the plaintiff is: Michael D. Braun, Esq. Braun Law Group, PC 12304 Santa Monica Blvd., Suite 109 Phone: 310-442-7755 Fax: 310-442-7756 MTD: Recalls Cub Cadet Utility Vehicles Due to Fire Hazard ---------------------------------------------------------- MTD, of Brownsville, Tenn., in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 700 Cub Cadet 4x4 EFI Volunteer Utility Vehicles. The company said excessive heat can cause the wiring harness to melt. This defect can result in a fire hazard to consumers. MTD has received five reports of heat damage to the vehicle. There have been no reports of personal injury. The recalled utility vehicle is a four-wheel drive vehicle with "Cub Cadet, Tracker Edition" printed on the side panel. This vehicle has roll over protection and an open cargo bed in the back with "Volunteer" printed on the side. It is equipped with a Kohler electronic fuel-injected engine. The model/serial plate is located under the driver's seat. These recalled utility vehicles were manufactured in the United States and were being sold at Cub Cadet dealerships and Bass Pro retail outlets nationwide under the Cub Cadet brand name from March 2008 through April 2008 for between $9,700 and $10,500. A picture of the recalled utility vehicle is found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08583.jpg Consumers are advised to stop using these vehicles immediately and contact their Cub Cadet dealership to have their utility vehicle serviced at no charge. All known consumers have been contacted. Each reworked utility vehicle has a green "X" label on the model/serial tag. For additional information, contact the firm toll-free at 888-848-6038 between 8:00 a.m. and 5:00 p.m. ET Monday through Friday. PARMALAT: Defendants Object to Interim Approval of Hermes Deal -------------------------------------------------------------- Defendants Bank of America Corporation, Bank of America, N.A., Banc of America Securities Limited, Citigroup Inc., Citibank N.A., Eureka Securitisation Plc, Grant Thornton International, Grant Thornton LLP and Pavia e Ansaldo filed a memorandum with the U.S. District Court for the Southern District of New York on June 5, 2008, in opposition to the District Court's preliminary approval of Hermes Focus Asset Management Europe, Ltd.'s proposed settlement with Parmalat S.p.A, a report from the PARMALAT Bankruptcy News, Issue No. 103 said. The Non-Settling Defendants object to approval of the proposed Settlement unless the minimum pro tanto judgment credit incorporates: (1) the full value of the Settlement Class' negotiated allowed claim in Parmalat's Italian bankruptcy, or, in the alternative, the full market value of the Parmalat stock, provided under the Concordato as of May 1, 2008; and (2) the value of the settlement of Parmalat's claims against the Hermes Plaintiffs. Daniel A. McLaughlin, Esq., at Sidley Austin LLP, in New York, counsel to the BofA, tells the District Court that the judgment credit is particularly important in the Settlement, since Parmalat is the principal wrongdoer. Each claim against the Defendants is based on a theory of secondary participation, Mr. McLaughlin contends. Accordingly, the Settlement Agreement should incorporate the full value of the settlement, he asserts. In the alternative, Mr. McLaughlin says, should the District Court measure the judgment credit by the outcome of Parmalat's Italian bankruptcy proceeding, the distribution of 10,500,000 Parmalat S.p.A. shares to the settlement class -- the arbitrary valuation of the shares being worth $14,000,000 -- should not be used, since it understates inaccurately the value of the shares at the time of the agreement. Mr. McLaughlin contends that there is additional, preferential compensation provided to the Hermes Plaintiffs. The Settlement includes not only the settlement of the U.S. class action, but also settlement of a separate lawsuit brought by Parmalat against Hermes in Italy, as well as other complaints with the Italian prosecutors relating to Parmalat. According to Mr. McLaughlin, Parmalat seeks very substantial damages based on Hermes' alleged misconduct. Specifically, Parmalat sought EUR5,000,000,000 in damages, according to a press release from which Mr. McLaughlin cites. He added that the release of those claims provides relief to the Hermes Plaintiffs far in excess of the value of the stock component of the Settlement. Mr. McLaughlin points out the release of claims, seeking in excess of $7,000,000,000 at current exchange rates, have been a factor in the settlement. Accordingly, it must be incorporated in any meaningful estimate of the Settlement value. The Non- Settling Defendants submit that the release must be valued at the face value of the claims, unless the settling parties can come forward with evidentiary basis for assigning a lesser amount. Mr. McLaughlin maintains that while these matters may not require final resolution by the District Court until the Settlement is presented for final approval, they are properly raised at this time. He says that the Court should examine the issues, in light of their impact on the notice and certification of the settlement class. The Lead Plaintiffs and Parmalat should provide a more complete disclosure of the facts necessary to permit an informed evaluation of the Settlement Agreement, Mr. McLaughlin asserts. In light of these, the Non-Settling Defendants ask the Court to include the (i) full value of the allowed claim, and (ii) settlement of Parmalat's claims against the Hermes Plaintiffs in any judgment credit resulting from the Settlement. Meanwhile, Defendants Deloitte Touche Tohmatsu, Deloitte & Touche LLP and James E. Copeland tell Judge Kaplan that they do not object to Hermes' settlement of its disputes with Parmalat. However, they oppose the granting of Hermes' Motion, to the extent it would compromise the Deloitte Touche Defendants' right to the proper calculation of a pro tanto judgment reduction credit, as set forth by the Non-Settling Defendants, Michael J. Dell, Esq., at Kramer Levin Naftalis & Frankel LLP, in New York, tells the Court. Hermes Responds According to Hermes, the Defendants' responses do not challenge the the relief sought in the motion for preliminary approval, which was limited to the (i) preliminary certification of a settlement class, (ii) approval of the notice form, and (iii) scheduling a hearing. The Defendants' submissions are irrelevant to the Hermes' Preliminary Motion, James J. Sabella, Esq., at Grant & Eisenhofer P.A., in New York, reasons out, and their statements should not delay the approval of the Preliminary Motion and the commencement of the notice process. Moreover, the points raised by the Defendants, according to Mr. Sabella, are without merit since the Settlement Agreement and proposed final judgment contain a provision for judgment reduction that directly tracks the language in the Private Securities Litigation Reform Act. The exact amount that the Defendants will receive cannot be calculated at this juncture, Mr. Sabella insists. There is no merit to the Defendants' assertions that the credit should be based on the $200,000,000 judgment credit needed to yield 10,500,000 shares, or on the $7,000,000,000 ad damnun by Parmalat in its Italian proceeding against Hermes, Mr. Sabella tells the Court. However, Hermes does not dispute the Defendants' contention that the judgment credit should be based on the market value of the Parmalat stock as of May 1, 2008, valued at $35,000,000. Mr. Sabella maintains that granting the Preliminary Motion will be without prejudice to the Defendants' arguments as to class certification, and to their ability to present arguments at an appropriate time with respect to the amount of the judgment credit. ROHM & HASS: Minnesota Lawsuit Alleges Plastics Price Fixing ------------------------------------------------------------ Rohm & Hass is facing a class-action complaint before the U.S. District Court for the District of Minnesota alleging it conspired to fix prices for plastic additives, a $16.3 billion annual market, CourtHouse News Service reports. Other named defendants in the complaint are: -- Arkema fka Atofina Chemicals fka Elf Atochem North America, -- Ferro Corp., -- Mitsubishi Rayon America, -- Akcros Chemicals America, and -- Akzo Nobel. The chemicals companies are accused of conspiring to restrain trade and fix prices for plastic additive "such as heat stabilizers, impact modifiers, and processing aids used to manufacture or process plastics." Named plaintiff Sharon Defren alleges that she directly purchased plastic additives from defendants whose conspiracy violated Minn. Stat. Section 325D.49, et seq. Plaintiff also states a common-law claim for unjust enrichment under Minnesota's unjust enrichment law. Plaintiff brings this class action pursuant to Rule 23 of the Federal Rules of Civil Procedure on behalf of all persons and business entities in Minnesota that indirectly purchased products containing plastic additives manufactured, sold or distributed by defendants, other than for resale, from Jan. 1, 1990 to and including Jan. 31, 2003. Plaintiff wants the court to rule on: (a) whether defendants conspired to fix, raise, maintain, or stabilize the prices of plastic additives marketed, distributed, and sold in Minnesota; (b) whether defendants conspired to manipulate and allocate the market for plastic additives marketed, distributed, and sold in Minnesota; (c) the existence and duration of defendants' horizontal agreements to fix, raise, maintain, or stabilize the prices of plastic additives marketed, distributed, and sold in Minnesota; (d) the existence and duration of defendants' horizontal agreements to manipulate and allocate the market for plastic additives marketed, distributed and sold in Minnesota; (e) whether each defendant was a member of, or participated in, the arrangement, contract, or agreement to fix, raise, maintain, or stabilize the prices of plastic additives marketer, distributed and sold in Minnesota; (f) whether each defendant was a member of, or participated in, the arrangement, contract, or agreement to allocate the market for plastic additives marketed, distributed and sold in Minnesota; (g) whether defendants' conspiracy was implemented; (h) whether defendants took steps to conceal their conspiracy from plaintiff and the class members; (i) whether defendants' conduct caused injury in fact to the business or property of plaintiff and the class members, and if so, the appropriate classwide measure of damages; (j) whether the agents, officers or employees of defendants and their co-conspirators participated in telephone calls, meetings, and other communications in furtherance of their conspiracy; and (k) whether the purpose and effect of the acts and omissions alleged was to fix, raise, maintain or stabilize the prices of plastic additives marketed, distributed, and sold in Minnesota and to manipulate and allocate the market for plastic additives marketed, distributed and sold in Minnesota. Plaintiff requests: -- that the court determine that this action may be maintained as a class action under Rule 23 of the Federal Rules of Civil Procedure and certify plaintiff's proposed class; -- that the court rules that defendants' conspiracy violated Minn. Stat. Section 325D.49 et seq. and that compensatory damages, including treble damages and attorneys' fees are appropriate; -- that the court determine that defendants were unjustly enriched; -- that the court permanently enjoin defendants from conspiring to fix plastic additives prices and allocating plastic additives markets or other injunctive relief as the court deems appropriate; -- that the court award plaintiff post-judgment interest, their costs, and reasonable attorneys' fees; and -- that the court order any other relief as it deems just and proper. The suit is "Sharon Defren, et al. v. Rohm & Haas Company, et al., Case No. 08cv2208 JNE/FLN," filed in the U.S. District Court for the District of Minnesota. Representing the plaintiffs is: Stanley E. Karon, Esq. (karontrial@yahoo.com) Karon Trial Law PA 6600 Lyndale Ave., S., Suite 1004 Minneapolis, MN 55423 Phone: 612-236-1324 Fax: 612-236-1325 RUBIO'S RESTAURANTS: Faces Labor-Related Lawsuit in California -------------------------------------------------------------- Rubio's Restaurants, Inc., is facing a purported class action suit in California state court, alleging that it failed to provide former employees with certain meal and rest period breaks and overtime pay. The suit was filed on March 24, 2005, by a former employee of the company. The parties moved the matter into arbitration, and the former employee amended the complaint to claim that he represents a class of potential plaintiffs. The amended complaint alleges that current and former shift leaders who worked in the company's California restaurants during specified time periods worked off the clock and missed meal and rest breaks. This case is still in the pre-class certification discovery stage, and no class has been certified, 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. Rubio's Restaurants, Inc. -- http://www.rubios.com/-- owns, operates and franchises restaurants. As of March 25, 2008, the Company owned and operated 174 fast-casual Mexican restaurants, three licensed locations, and two franchised restaurants that offers Mexican cuisine, including chargrilled chicken, steak and fresh seafood items, such as burritos, tacos and quesadillas inspired by the Baja, California region of Mexico. The Company has two wholly owned subsidiaries: Rubio's Restaurants of Nevada, Inc. and and Rubio's Promotions, Inc. Its restaurants are located in California, Arizona, Nevada, Colorado and Utah. The Company's menu includes the Fish Tacos, HealthMex and Kid�s Meals. SHORETEL INC: Faces Two Securities Fraud Lawsuits in California --------------------------------------------------------------- ShoreTel, Inc., is facing two purported securities fraud class action suits before the U.S. District Court for the Northern District of California, 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 Jan. 16, 2008, a purported stockholder class action lawsuit, captioned "Watkins v. ShoreTel, Inc., et al.," was filed in the U.S. District Court for the Northern District of California against ShoreTel, certain of its officers and directors, and the underwriters of its initial public offering. On Jan. 29, 2008, a second purported stockholder class action complaint, captioned "Kelley v. ShoreTel, Inc., et al.," was filed in the U.S. District Court for the Northern District of California against the same defendants. Both complaints purport to bring suit on behalf of those who purchased the company's common stock pursuant to its initial public offering on July 3, 2007. Both complaints purport to allege claims for violations of the federal securities laws and seek unspecified compensatory damages and other relief. The company reported no development in the matter in its regulatory filing. ShoreTel, Inc. -- http://www.shoretel.com/-- is a provider of Internet protocol telecommunications systems for enterprises. The Company's systems are based on its distributed software architecture and switch-based hardware platform, which enable multi-site enterprises to be served by a single telecommunications system. ShoreTel's solution consists of ShoreGear switches, ShorePhone IP telephones and ShoreWare software applications. It provides its systems to enterprises across all industries, including to small, medium and large companies, and public institutions. Its enterprise customers include multi-site Fortune 500 companies. As of June 30, 2007, ShoreTel had sold its IP telecommunications systems to over 5,000 enterprise customers, including CNET Networks, Robert Half International, SEGA, Wedbush Morgan Securities, and the City of Oakland, California. SOLERA HOLDINGS: Faces Lawsuit Over "Total Loss Estimation" ----------------------------------------------------------- Solera Holdings, Inc., is facing a putative class action lawsuit in connection with total loss estimation, 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 alleges that the company colluded with its insurance company customers to cause the estimates of vehicle fair market value generated by the company's total loss estimation products to be unfairly low. Solera Holdings, Inc. -- http://www.solerainc.com/-- is a global provider of software and services to the automobile insurance claims processing industry. The Company's customers include more than 900 automobile insurance companies; 33,000 collision repair facilities; 7,000 independent assessors, and 3,000 automotive recyclers. Solera Holdings, Inc. helps its customers estimate the costs to repair damaged vehicles; determine pre-collision fair market values for vehicles damaged beyond repair; automate steps of the claims process; outsource steps of the claims process that insurance companies have historically performed internally, and improve their ability to monitor and manage their businesses through data reporting and analysis. As of June 30, 2007, it served more than 55,000 customers in 49 countries. Its software and services are organized into five general categories: estimating and workflow software; salvage and recycling software; business intelligence and consulting services; shared services, and other. TORREYPINES THERAPEUTICS: Motion to Junk Securities Suit Pending ---------------------------------------------------------------- The U.S. District Court for the Southern District of New York has yet to rule on a motion seeking the dismissal of a consolidated securities class action lawsuit filed against TorreyPines Therapeutics, Inc. -- formerly Axonyx, Inc. Several lawsuits were filed against the company in February 2005, asserting claims under Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934 and Rule 10b-5 thereunder on behalf of a class of purchasers of the company's common stock from June 26, 2003, through and including Feb. 4, 2005. Director and former Axonyx chief executive officer, Dr. M. Hausman, and current Axonyx CEO Dr. G. Bruinsma, were also named as defendants in the lawsuits. These suits were consolidated into a single class action in January 2006. The plaintiffs allege generally that the company's Phase III Phenserine development program was subject to errors of design and execution, which resulted in the failure of the first Phase III Phenserine trial to show efficacy. They also said that the defendants' failure to disclose the alleged defects resulted in the artificial inflation of the price of the company's shares during the class period. On April 10, 2006, the class action plaintiffs filed an amended consolidated complaint. The company filed its answer to that complaint on May 26, 2006. The company's motion to dismiss the consolidated amended complaint was filed on May 26, 2006, and was submitted to the court for a decision in September 2006. The motion to dismiss is still pending. The company reported no development in the matter in its May 13, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2008. The suit is "In Re: Axonyx Securities Litigation, Case No. 1:05-cv-02307-TPG," filed in the U.S. District Court for the Southern District of New York, Judge Thomas P. Griesa, presiding. Representing the plaintiffs are: Evan Jay Kaufman, Esq. (ekaufman@csgrr.com) Coughlin, Stoia, Geller, Rudman & Robbins, LLP(LIs) 58 South Service Road, Suite 200 Melville, NY 11747 Phone: 631-367-7100 Fax: 631-367-1173 - and - Evan J. Smith, Esq. (esmith@brodsky-smith.com) Brodsky & Smith, L.L.C. 240 Mineola Blvd. Mineola, NY 11501 Phone: 516-741-4977 Representing the defendants are: May Orenstein, Esq. (morenstein@brownrudnick.com) Sigmund Samuel Wissner-Gross, Esq. (swissnergross@brownrudnick.com) Brown Rudnick Berlack Israels, LLP Seven Times Square New York, NY 10036 Phone: 212-209-4800 212-209-4930 Fax: 212-938-2804 U.S. AUTO: Settles Calif. Consolidated Securities Fraud Lawsuit --------------------------------------------------------------- U.S. Auto Parts Network, Inc., reached a settlement in a consolidated securities fraud class action lawsuit filed against it before the U.S. District Court for the Central District of California, 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 March 24, 2007, a putative stockholder class action lawsuit was filed against the company and certain officers, directors and underwriters. The complaint alleges that the company filed a false Registration Statement in connection with the company's initial public offering in violation of Section 11 and Section 15 of the Securities Act of 1933, as amended. On April 26, 2007, a second complaint containing substantially similar allegations was filed, and also included a claim under Section 12(a)(2) of the Securities Act. The complaints were consolidated on May 15, 2007. A lead plaintiff was appointed on Aug. 9, 2007. An amended consolidated complaint was filed in October 2007. The amended complaint is against the company and certain current and former officers, as well as Oak Investment Partners XI, LP, and the underwriters involved in the initial public offering. The plaintiffs seek compensatory damages, restitution, unspecified equitable relief, as well as attorneys' fees and costs. The defendants filed a motion to dismiss the amended consolidated complaint on Oct. 31, 2007. In January 2008, the parties reached a settlement in principle to resolve the matter. A definitive settlement agreement was filed on May 1, 2008, which settlement is still subject to the Court's approval. The suit is "Patricia Johnson, et al. v. U.S. Auto Parts Network, Inc., et al., Case No. 07-CV-02030," filed in the U.S. District Court for the Central District of California, Judge George H. Wu, presiding. Representing the plaintiffs are: Sarah Catherine Boone, Esq. (sarah.boone@kgscounsel.com) Kahn Gauthier Swick 650 Poydras Street, Suite 2150 New Orleans, LA 70130 Phone: 504-455-1400 x106 Fax: 504-455-1498 - and - Timothy J. Burke, Esq. Stull Stull and Brody 10940 Wilshire Boulevard, Suite 2300 Los Angeles, CA 90024 Phone: 310-209-2468 e-mail: service@ssbla.com Representing the defendants are: Luke A. Liss, Esq. (lliss@wsgr.com) Wilson Sonsini Goodrich and Rosati 650 Page Mill Road Palo Alto, CA 94304-1050 Phone: 650-493-9300 - and - Diane Lee McGimsey, Esq. (mcgimseyd@sullcrom.com) Sullivan And Cromwell 1888 Century Park East, Suite 2100 Los Angeles, CA 90067 Phone: 310-712-6600 VIRGIN MOBILE: Plaintiff Appeals Dismissal of "Ballas" Lawsuit -------------------------------------------------------------- The plaintiff in the matter "Ballas v. Virgin Mobile USA, LLC, Virgin Mobile USA, Inc. and Virgin Media, Inc.," has appealed the dismissal of the case, which names Virgin Mobile USA, Inc., as a defendant. The putative class action suit was commenced on May 21, 2007, before the Supreme Court of the State of New York, Nassau County. It was brought on behalf of a purported class of individuals who purchased Virgin Mobile-brand handsets within the State of New York. The complaint names three defendants: the company, Virgin Mobile USA, LLC, and Virgin Media, Inc. Virgin Media was subsequently dismissed voluntarily from the lawsuit. The complaint alleges that the defendants failed to disclose, on their Web sites and on the retail packaging of Virgin Mobile- brand handsets, the replenishment or "Top-Up" requirements (the periodic minimum payments required to keep an account active) and the consequences of failing to adhere to them, and further alleges that the retail packaging implies that no such requirements exist. The plaintiff asserts two causes of action, one for breach of contract and one for deceptive acts and practices and misleading advertising under New York General Business Law Sections 349 and 350. The court granted the company's motion to dismiss the case for failure to state a cause of action. On Jan. 7, 2008, the plaintiff filed a notice of appeal in connection with the court's dismissal of the suit, 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. Virgin Mobile USA, Inc. -- http://www.virginmobileusa.com/-- is a provider of wireless communications services, offering prepaid, or pay-as-you-go, services targeted at the youth market. The Company offers its products and services on a flat per-minute basis and on a monthly basis for specified quantities, or buckets, of minutes purchased in advance, in each case without requiring VMU's customers to enter into long-term contracts or commitments. The Company markets its products and services under the Virgin Mobile brand. VMU has rights to use the Virgin Mobile brand for mobile voice and data services through 2027, in the U.S., Puerto Rico and the U.S. Virgin Islands through its trademark license agreement with the Virgin Group. VIRGIN MOBILE: Continues to Faces D.C. Lawsuit Over Excise Tax -------------------------------------------------------------- Virgin Mobile USA, Inc., is still one of 12 telecommunications carriers named as defendants in a class action lawsuit entitled, "Belloni, et al. v. Verizon Communications, et al.," which was brought on behalf of a purported class of long distance telephone customers. The amended class action complaint was filed in October 2006 before the U.S. District Court for the Southern District of New York. It alleges that the defendants unlawfully collected and remitted money to the IRS in the guise of an excise tax that the plaintiffs assert was inapplicable to the services provided. On Jan. 16, 2007, the Judicial Panel on Multidistrict Litigation conditionally transferred the action to the U.S. District Court for the District of Columbia for coordinated or consolidated pretrial proceedings with related actions, under the caption, "In Re: Long-Distance Telephone Service Federal Excise Tax Refund Litigation, MDL-1798, Case No. 1:2007mc00014." The plaintiffs seek compensatory, statutory and punitive damages in an amount not specified. They generally claim that the defendants are liable for the full amount collected from customers and remitted to the government, and damages flowing from the alleged failure to file with the FCC and communicate to the public the non-applicability of the Communications Excise Tax. The plaintiffs also seek attorneys' fees and costs. 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 quarter ended March 31, 2008. Virgin Mobile USA, Inc. -- http://www.virginmobileusa.com/-- is a provider of wireless communications services, offering prepaid, or pay-as-you-go, services targeted at the youth market. The Company offers its products and services on a flat per-minute basis and on a monthly basis for specified quantities, or buckets, of minutes purchased in advance, in each case without requiring VMU's customers to enter into long-term contracts or commitments. The Company markets its products and services under the Virgin Mobile brand. VMU has rights to use the Virgin Mobile brand for mobile voice and data services through 2027, in the U.S., Puerto Rico and the U.S. Virgin Islands through its trademark license agreement with the Virgin Group. VIRGIN MOBILE: Named as Defendant in New Jersey IPO-Related Suit ---------------------------------------------------------------- Virgin Mobile USA, Inc., certain of the its officers and directors, and other defendants, face a purported class action lawsuit before the U.S. District Court for the District of New Jersey, according to Virgin Mobile's May 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2008. Initially, two federal class-action lawsuits were filed with the U.S. District Court for the District of New Jersey and with the U.S. District Court for the Southern District of New York. Each suit alleges that the prospectus and registration statement filed pursuant to the company's IPO contained materially false and misleading statements in violation of the Securities Act of 1933, and additionally alleges that at the time of the IPO the Company was aware, but did not disclose, that results for the third quarter of 2007 indicated widening losses and slowing subscriber growth trends. On Jan 7, 2008, the company filed a motion to consolidate all cases with the U.S. District Court for the Southern District of New York for pre-trial purposes. On April 7, 2008, the U.S. Judicial Panel on Multidistrict Litigation granted the motion and consolidated the cases with the U.S. District Court for the District of New Jersey. On March 17, 2008, the district court judge in the New Jersey matter appointed the New Jersey plaintiffs as lead plaintiffs for the litigation. Virgin Mobile USA, Inc. -- http://www.virginmobileusa.com/-- is a provider of wireless communications services, offering prepaid, or pay-as-you-go, services targeted at the youth market. The Company offers its products and services on a flat per-minute basis and on a monthly basis for specified quantities, or buckets, of minutes purchased in advance, in each case without requiring VMU's customers to enter into long-term contracts or commitments. The Company markets its products and services under the Virgin Mobile brand. VMU has rights to use the Virgin Mobile brand for mobile voice and data services through 2027, in the U.S., Puerto Rico and the U.S. Virgin Islands through its trademark license agreement with the Virgin Group. WAL-MART: Recalls Charm Key Chains Due to Risk of Lead Exposure --------------------------------------------------------------- Wal-Mart Stores Inc., of Bentonville, Ark. in cooperation with the U.S. Consumer Product Safety Commission, is recalling about 39,000 (firm previously recalled 12,000 key chains in April 2008) "Hip Charm" Key Chains imported by FGX International Inc., of Smithfield, R.I. The company said the charms on the key chain can contain high levels of lead, which is toxic if ingested and can cause adverse health effects. here have been no injuries reported with the additional key chains included in this recall. The Illinois Attorney General informed Wal-Mart and CPSC in April that the previously recalled key chain was found in the home of a 9-month-old child who was discovered to have high blood levels of lead. The child was observed mouthing this key chain. The recalled key chains have several charms including a button, clover, leaf, and heart. The charms hang from a silver-colored chain. The words "Hip charm" and the following UPC numbers are printed on the products packaging: -- 03156811032, -- 03156811029, -- 03156811019, -- 03156811016, -- 03156811018, -- 03156811028, and -- 03156811030. These recalled hip charms were manufactured in China and were being sold at Wal-Mart stores nationwide from April 2005 through June 2008 for between $ .50 and $6. Pictures of the recalled hip charms are found at: http://www.cpsc.gov/cpscpub/prerel/prhtml08/08307a.jpg http://www.cpsc.gov/cpscpub/prerel/prhtml08/08307b.jpg Consumers should not allow children to handle the key chain and return it to any Wal-Mart store for a full refund. For further information, contact Wal-Mart at 800-925-6278 between 7:00 a.m. and 9:00 p.m. CT Monday through Friday, or visit the firm's Web site: http://www.walmartstores.com/ WET SEAL: California Court Approves Employees' Suit Settlement -------------------------------------------------------------- The Los Angeles Superior Court in California gave final approval to a settlement deal in a purported labor-related class action lawsuit filed on July 19, 2006, against The Wet Seal, Inc., according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. The class action complaint was filed on behalf of certain of the company's current and former employees that were employed and paid by the company on an hourly basis during the four-year period from July 19, 2002, through July 19, 2006. The complaint alleges violations under the State of California Labor Code, the State of California Business and Professions Code, and violation of orders issued by the Industrial Welfare Commission with respect to paying employees all overtime wages due, observing meal and rest periods and maintaining proper records of wages earned and rates of pay. The complaint seeks class certification, compensatory damages, costs, attorney's fees, injunctive relief and such other and further relief that the Superior Court may deem just and proper. On November 30, 2006, the company reached an agreement to pay approximately $0.3 million to settle this matter. On Feb. 29, 2008, the court issued its order granting final approval of the class action settlement. The Wet Seal, Inc. -- http://www.wetsealinc.com/-- is a national specialty retailer operating stores selling apparel and accessory items designed for female customers aged 13 to 35. As of Feb. 2, 2008, the Company operated 494 retail stores in 47 states, Puerto Rico and Washington D.C. Its products can also be purchased online. The Company operates two nationwide, primarily mall-based, chains of retail stores under the names Wet Seal and Arden B. Wet Seal is the junior apparel brand for teenage girls that seek trend-focused and value competitive clothing with a target customer age of 13 to 19 years old. Wet Seal seeks to provide its customer base with a balance of affordably priced fashionable apparel and accessories. Arden B is a fashion brand for the feminine contemporary woman with sex appeal. Arden B targets customers aged 25 to 35 and seeks to deliver contemporary collections of fashion separates and accessories for various aspects of the customers' lifestyles. WET SEAL: Withdraws Settlement Offer in Calif. FCRA Litigation -------------------------------------------------------------- The Wet Seal, Inc., withdrew its offer to settle a purported class action suit over alleged violations of credit rules, after a similar case was filed against the company, according to the company's June 10, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2008. In January 2007, a class-action complaint was filed before the U.S. District Court for the Central District of California, alleging violations of The Fair Credit Reporting Act. The Act provides in part that portions of the credit card number may not be printed together with expiration dates on credit or debit card receipts given to customers. It imposes significant penalties upon violators of these rules and regulations where the violation is deemed to have been willful. Otherwise, damages are limited to actual losses incurred by the card holder. In February 2007, a second class-action complaint was filed against the company alleging similar violations in the same court. Both parties in the February 2007 complaint have agreed to dismiss the complaint with prejudice. On Dec. 11, 2007, the company reached a tentative agreement to settle the January 2007 suit for less than $0.1 million. However, prior to the receipt of the executed settlement agreement, on Feb. 8, 2008, the company was named in another action, alleging the same violation, in the U.S. District Court for the Western District of Pennsylvania. As a result, the company withdrew its offer to settle the January 2007 action. On June 3, 2008, the Credit and Debit Card Receipt Clarification Act of 2007 was enacted. This measure amends the FCRA to declare that a company that printed an expiration date on any receipt provided to a consumer cardholder at the point of sale or transaction between Dec. 4, 2004, and the enactment of this legislation, but otherwise complied with FCRA requirements for such receipt, shall not be in willful noncompliance by reason of printing such expiration date in it. Under this definition, the company believes that it has not committed any willful violation of the FCRA. The Wet Seal, Inc. -- http://www.wetsealinc.com/-- is a national specialty retailer operating stores selling apparel and accessory items designed for female customers aged 13 to 35. As of Feb. 2, 2008, the Company operated 494 retail stores in 47 states, Puerto Rico and Washington D.C. Its products can also be purchased online. The Company operates two nationwide, primarily mall-based, chains of retail stores under the names Wet Seal and Arden B. Wet Seal is the junior apparel brand for teenage girls that seek trend-focused and value competitive clothing with a target customer age of 13 to 19 years old. Wet Seal seeks to provide its customer base with a balance of affordably priced fashionable apparel and accessories. Arden B is a fashion brand for the feminine contemporary woman with sex appeal. Arden B targets customers aged 25 to 35 and seeks to deliver contemporary collections of fashion separates and accessories for various aspects of the customers' lifestyles. * Securities Litigation Team Gets 3 Major Victories in 10 Days -------------------------------------------------------------- Pepper Hamilton LLP recently secured major victories for biotechnology and pharmaceutical clients in three separate securities class actions in a 10-day period. Representing Discovery Laboratories, Inc., Eli Lilly and Company and GlaxoSmithKline, the firm won dismissals from three federal courts between April 29 and May 9, 2008. "Pharmaceutical securities litigation is different than securities cases in other industries because the industry is heavily regulated by the Food and Drug Administration, which allows a lot of information to fall into the public arena and be available to investors quickly," said Robert L. Hickok, a partner with Pepper Hamilton and a leader of its securities litigation practice. He continued, "There is high potential for risk in the industry. If the FDA does not approve a company's product or issues a safety alert regarding a drug that is already on the market, the company's stock price may drop, causing investors concern. Our job, as defense attorneys, is to explain how the FDA works so that the judge can evaluate a company's disclosures within the proper context. Pepper Hamilton's long history of representing pharmaceutical clients, our extensive knowledge of the FDA process, and the depth of our securities litigation practice in general are tremendous assets. These three recent victories illustrate that." Discovery Labs On April 29, 2008, the U.S. Court of Appeals for the Third Circuit affirmed the district court's dismissal of In re Discovery Laboratories Securities Litigation, a securities class action filed against Discovery Laboratories, Inc. -- http://www.discoverylabs.com/-- a biotechnology company developing Surfactant Replacement Therapies for respiratory diseases. The complaint alleged that Discovery Labs misled investors about the prospects for regulatory approval of its lead product, Surfaxin, for the prevention of Respiratory Distress Syndrome in premature infants. In 2007, before Judge Stewart Dalzell of the U.S. District Court for the Eastern District of Pennsylvania, Pepper Hamilton won motions to dismiss the plaintiffs' first and second amended securities class action complaints, as well as a motion to dismiss a separately filed derivative action. The Pepper Hamilton team representing Discovery Labs in the litigation included partners Robert L. Hickok, Gay Parks Rainville and Christopher J. Huber; of counsel James D. VandeWyngearde; and associates Thomas T. Watkinson II and Michele C. Zarychta. Eli Lilly Eli Lilly and Company's -- http://www.lilly.com/-- victory occurred in the Zyprexa litigation pending in the U.S. District Court for the Eastern District of New York. In "In re Eli Lilly and Company Securities Litigation," a securities class action involving Lilly's atypical antipsychotic medication Zyprexa, the court granted Lilly's motion for summary judgment and dismissed all of the plaintiffs' federal securities fraud claims on statute of limitations grounds. In their complaint, the plaintiffs alleged that articles published in The New York Times in December 2006 reported for the first time that Zyprexa allegedly presents a higher risk of diabetes-related conditions than do other atypical antipsychotic medications, and that Lilly allegedly engaged in off-label promotion of the medicine. In his April 30, 2008 opinion, Judge Jack B. Weinstein of the U.S. District Court for the Eastern District of New York held that the class action was time-barred since both issues were publicly debated by scientists, investment analysts and members of the legal profession long before the two-year statute of limitations began to run on plaintiffs' claims on March 28, 2005. The Pepper Hamilton team representing Lilly in the litigation included partners Robert L. Hickok, Gay Parks Rainville, Christopher J. Huber and Kenneth J. King; and associates Andrea Toy Ohta, Elizabeth M. Ray, April Denise Seabrook, Thomas T. Watkinson II, Michele C. Zarychta, Amber M. Schuknecht and Andrea M. de Vries. GlaxoSmithKline In "Borochoff, et al. v. GlaxoSmithKline, et al.," a federal district judge granted GlaxoSmithKline's -- http://www.gsk.com/ -- motion to dismiss the securities class action filed by investors alleging that GSK's statements about its diabetes medicine, Avandia, were false and misleading. Judge Louis L. Stanton of the U.S. District Court for the Southern District of New York dismissed the case on May 9, 2008, and denied the plaintiffs' request to replead. The court held that the complaint failed to sufficiently plead that the defendants made any material misrepresentation or omission or acted with fraudulent intent. The plaintiffs recently filed a motion asking the court to reconsider its decision. The Pepper Hamilton team representing GSK in the litigation included partners Robert L. Hickok, Gay Parks Rainville, Michael E. Baughman and Kenneth J. King; and associates Patricia A. McCausland, William C. Root and Aubrey L. Jones. Pepper Hamilton LLP -- http://www.pepperlaw.com/-- is a multi- practice law firm with more than 500 lawyers in seven states and the District of Columbia. The firm provides corporate, litigation and regulatory legal services to leading businesses, governmental entities, nonprofit organizations and individuals throughout the nation and the world. The firm was founded in 1890. Pepper Hamilton's securities litigation practice includes representing corporations, their directors and officers, investment bankers and accountants in civil, criminal and administrative proceedings regarding corporate governance and the issuance and trading of securities. The firm's practice takes it before federal and state courts and administrative agencies in jurisdictions throughout the United States. Pepper lawyers also are experienced in representing clients in investigations and litigation by the U.S. Securities and Exchange Commission. Pepper Hamilton works with many biotechnology and pharmaceutical companies and has extensive experience defending them in securities class action litigation. Pepper lawyers know and understand the drug development and regulatory approval processes, and provide the courts with the context they need for fairly assessing the disclosures at issue. The firm's commercial litigators often draw upon the experience of their health effects litigation colleagues, whose deep expertise in the industry helps make the firm's representations more effective. Members of the Health Effects Litigation Practice Group, led by partner Nina M. Gussack, counsel clients and handle litigation involving claimed adverse health effects from ingestion of or exposure to pharmaceuticals, medical devices, radiation, chemicals, consumer goods, environmental substances and industrial equipment. ********* 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. ********* 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. * * * End of Transmission * * *