/raid1/www/Hosts/bankrupt/CAR_Public/080630.mbx
C L A S S A C T I O N R E P O R T E R
Monday, June 30, 2008, Vol. 10, No. 128
Headlines
99 CENTS: Court Yet to Give $3.2M Labor Suit Settlement Final OK
ABERCROMBIE & FITCH: Settlement of Claims in Labor Suit Approved
CITIGROUP INC: Scott+Scott Commences Lawsuit Over MAT Funds
CITIGROUP INC: Falcon Plus Investors Commence N.Y. Lawsuit
COMCAST CORP: Faces California Lawsuit Over Improper Charging
CSX CORP: Directors Breached Fiduciary Duties, Fla. Suit Claims
DAVE & BUSTER'S: Faces Consolidated Labor Lawsuit in California
FIRST NLC: Continues to Face FCRA Violations Lawsuit in Illinois
FOOT LOCKER: Subsidiaries Face Multiple Labor-Related Lawsuits
GENERAL MOTORS: Faces Mo. Suit Over Leaking Avalanche Windows
GLOBAL CROSSING: Ill. Landowners' Rights-of-Way Suit Continues
HILLENBRAND INDUSTRIES: Sept. 8 Docket Call Set for FCA Matter
HILLENBRAND INDUSTRIES: Sept. 8 Docket Call Set for PVC Matter
HILLENBRAND INDUSTRIES: Nov. 3 Trial Set for "Staples" Lawsuit
KNIGHT INC: Discovery Continues in "Going Private" Lawsuits
NEW CENTURY: Indiana Court Yet to Approve FCRA Suit Settlement
NEW CENTURY: Fourth Amended Complaint Filed in Calif. Wage Suit
NEW CENTURY: Parties Seek Dismissal of "Forrest" Case in Calif.
NEW CENTURY: Still Faces Securities Fraud Lawsuits in California
NORTH AMERICAN: Faces Suit in N.J. Over Discharge Recording Fees
PERPETUAL STORAGE: Suit Launched Over Stolen U. Billing Records
PHONE COS: Deceptive Marketing Suit Settlement Gets Approval
RITE AID: Faces Pennsylvania Suit Over Sale of Expired Medicine
SAKS INC: Still Faces Alabama Suit Over Merchandise Return Fees
SECURITY PLAN: Faces Policyholder's Suit Over Medical Expenses
SECURITY PLAN: Faces La. Litigation Over Insurance Coverage
TYCO INT'L: New Hampshire Securities Fraud Suits Emerge Again
WR GRACE: Court Yet to Rule on Relief Motions in ZAI Claims
* Americas Watchdog Expands Services for Plaintiffs
* Retroactive Liability Protection Changes Considered by Senate
New Securities Fraud Cases
FIRST AMERICAN: Federman & Sherwood Files N.Y. Securities Suit
SONOCO PRODUCTS: Coughlin Stoia Files S.C. Securities Fraud Suit
*********
99 CENTS: Court Yet to Give $3.2M Labor Suit Settlement Final OK
----------------------------------------------------------------
The Ventura County Superior Court has yet to grant final
approval to the proposed $3.2-million settlement of two labor-
related class action lawsuits filed against 99 Cents Only
Stores, according to the company's June 11, 2008 Form 10-K
filing with the U.S. Securities and Exchange Commission for the
fiscal year ended March 29, 2008.
The two suits are:
1. "Vargas v. 99c Only Stores," filed in the Ventura
County Superior Court in California, and
2. "Washington v. 99c Only Stores," filed in the Los
Angeles County Superior Court in California.
Vargas Litigation
On June 19, 2006, plaintiff Joanna Vargas filed a putative class
action lawsuit against the company, seeking to represent its
California retail non-exempt employees. The Vargas lawsuit
alleges that 99c Only failed to provide or pay for meal or rest
breaks and associated claims, non-payment of wages, and non-
payment of overtime wages.
The Vargas lawsuit sought compensatory, special and punitive
damages in unspecified amounts, penalties, attorneys fees and
injunctive relief.
Washington Litigation
On Oct. 31, 2006, plaintiff Chantelle Washington filed a
putative class action lawsuit against the company, seeking to
represent its California retail non-exempt cashier employees
with respect to similar claims. The Washington lawsuit alleges
failure to provide or pay for meal or rest breaks and associated
claims.
The Washington lawsuit seeks compensatory damages and penalties
in unspecified amounts, as well as equitable relief, attorney
fees and interest.
The Vargas and Washington actions have now been coordinated in
Ventura County Superior Court.
In November 2007, the company and the plaintiffs in both cases
entered into a settlement agreement providing for a maximum
payment of $3.2 million (including attorneys' fees).
On Nov. 30, 2007, the court granted preliminary approval to the
settlement and authorized the parties to provide a notice to
class members about the settlement.
The notice and claims process is now complete, and the parties
are awaiting final approval from the court.
99 Cents Only Stores -- http://www.99only.com/-- is a retailer
of consumable general merchandise. It operates through two
segments: retail operations and wholesale distribution. The
wholesale segment, Bargain Wholesale, sells primarily the same
merchandise as the retail segment at prices generally below
normal wholesale levels to local, regional and national
distributors and exporters. The Company had no customers
representing more than 10% of net sales. Substantially all of
the Company's net sales were to customers located in the U.S.
As of March 29, 2008, the Company operated 265 retail stores
with 186 in California, 46 in Texas, 22 in Arizona, and 11 in
Nevada. These stores averaged approximately 21,722 gross square
feet. The Company is also a wholesale distributor of various
consumable products.
ABERCROMBIE & FITCH: Settlement of Claims in Labor Suit Approved
----------------------------------------------------------------
The Superior Court of the State of California for the County of
Los Angeles approved the settlement of certain claims in a class
action lawsuit filed against Abercrombie & Fitch Co. and
Abercrombie & Fitch Stores, Inc., according to the company's
June 11, 2008 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended May 3, 2008.
The suit was filed by Lisa Hashimoto on June 23, 2006. She,
along with several other plaintiffs, alleged on behalf of a
putative class of California store managers employed in
Hollister and Abercrombie stores that they were entitled to
receive overtime pay as "non-exempt" employees under California
wage and hour laws.
The complaint seeks injunctive relief, equitable relief, unpaid
overtime compensation, unpaid benefits, penalties, interest and
attorneys' fees and costs.
The defendants filed an answer to the complaint on Aug. 21,
2006. The parties engaged in discovery.
On Dec. 10, 2007, the defendants reached an agreement in
principle with the plaintiffs' counsel to settle certain claims
in the action.
The agreement resulted in a written Stipulation and Settlement
Agreement, effective as of Feb. 7, 2008, settling all claims of
Hollister and Abercrombie store managers who served in the
stores from June 23, 2002, to April 30, 2004.
On June 9, 2008, the Court approved that settlement. The
settlement does not affect claims which are alleged to have
arisen in the period commencing on April 30, 2004, and the
parties are continuing to litigate those claims.
Abercrombie & Fitch Co. -- http://www.abercrombie.com/-- is a
specialty retailer that operates stores selling casual apparel,
such as knit shirts, graphic t-shirts, jeans, woven shirts,
shorts, as well as personal care and other accessories for men,
women and kids under the Abercrombie & Fitch, Abercrombie,
Hollister and RUEHL brands. As of Jan. 28, 2006, the company
operated 851 stores in the U.S. and Canada.
CITIGROUP INC: Scott+Scott Commences Lawsuit Over MAT Funds
-----------------------------------------------------------
Scott+Scott LLP has filed a class action on behalf of all
persons or entities who purchased or otherwise acquired shares
of the MAT Five LLC Fund (MAT Five Fund or Fund) pursuant and
traceable to the Private Placement Memorandum issued on or about
December 18, 2006.
The complaint alleges that MAT Five, Citigroup Global Markets
Inc., Citigroup Alternative Investments LLC and Citigroup Fixed
Income Alternatives violated section 12(a)(2) of the Securities
Act of 1933 and Delaware law.
Specifically, the complaint alleges that during late 2006 and
continuing into early 2007, Citigroup, through Citigroup Fixed
Income Alternatives and Citigroup Alternative Investments LLC
targeted many of its clients who were interested in fixed-income
investments which would provide higher yields.
Defendants marketed the MAT Five Fund to these clients and
disseminated a false and misleading Private Placement Memorandum
in connection with the issuance of hundreds of millions of
dollars of shares. The Private Placement Memorandum and related
selling documents were false and misleading because they
represented that the Fund was a secure, non-volatile investment.
In reality, the Fund was a high-risk investment which could lose
substantial value if the markets changed or if it was not
properly managed.
Indeed, MAT Five Fund management employed risky strategies and
lost. On March 20, 2008, CAI wrote a letter to investors which
stated that the recent credit crunch had rapidly accelerated and
spread into the municipal bond markets. As a result, the cash
positions and net asset values of the MAT Five Fund had been
severely impacted, and they were going to indefinitely suspend
the fund's income distributions in an effort to preserve
liquidity. At the time of the letter, the Fund had declined to
less than 10% of its original value and no further distributions
were made to the Plaintiffs.
For more information, contact:
Scott + Scott, LLP
29 West 57th Street
New York, NY 10019
Phone: 800-404-7770
860-537-5537
e-mail: scottlaw@scott-scott.com
CITIGROUP INC: Falcon Plus Investors Commence N.Y. Lawsuit
----------------------------------------------------------
Silverman Acampora LLP and Bragar Wexler Eagel & Squire have
filed a class action lawsuit on behalf of investors of the
Falcon Plus Strategies fund seeking damages against Citigroup
and its subsidiary entities including Citi Alternative
Investments LLC for the substantial losses incurred in the
investments.
The lawsuit was filed in Supreme Court State of New York, New
York County.
Clients of Silverman Acampora LLP, as investors in Citigroup's
Falcon funds , reported that they sustained heavy losses
(approximately 90%) in their investments. Citigroup, in
marketing the funds, compared the funds to relatively safe,
fixed-income investments. According to investors, Citigroup,
its subsidiary entities, and each of their representatives also
touted the investments as low risk and low volatility for
guaranteed income, and stated that the investors' maximum loss
of principal would range only between 10% and 15%.
Investors of Citigroup's Falcon funds are urged to explore legal
options with Silverman Acampora LLP. Ronald J. Friedman, Esq.
said, "We would be pleased to confer with any other investors in
the Falcon funds. The class action lawsuits may help recover
some of the substantial losses of the Citigroup fund investors."
For more information, contact:
Ronald J. Friedman, Esq.
Silverman Acampora, LLC
100 Jericho Quadrangle, Suite 300
Jericho, NY 11753
Phone: 516-479-6300
COMCAST CORP: Faces California Lawsuit Over Improper Charging
-------------------------------------------------------------
Comcast Corporation is facing a class-action complaint filed in
the Superior Court of the State of California in and for the
County of Santa Clara accusing it of improperly charging
customers who cancel after receiving inadequate services,
CourtHouse News Service reports.
The named plaintiff says he was charged $408 for one month of
inadequate, or nonexistent, service, and that he paid it to
preserve his credit rating.
The plaintiff brings this action on behalf of all California
residents whose purchased goods or services from Comcast
pursuant to a home solicitation contract which did not comply
with Civil Code Section 1689.7.
The plaintiff wants the court to rule:
(a) whether the defendant's policy and practice of failure
to provide important notice of cancellation information
to customers at the time the contract is signed is a
violation of the Home Solicitation Sales Act; and
(b) whether the defendant's policy of failure to provide
important notice of cancellation information to
customers at the time the contract is signed
constitutes a violation of the Business and Professions
Code Section 17200 et seq.;
The plaintiff asks the court:
-- for orders or judgments as may be necessary to
prevent the use or employment by any person of any
practice which constitutes unfair competition or as may
be necessary to restore to any person in interest any
money or property, real or personal, which may have been
acquired by means of such unfair competition;
-- for prejudgment interest to the extent allowed by law;
-- for actual damages;
-- for rescission of the contracts;
-- for costs;
-- for attorneys' fees; and
-- for such other and further relief as the court may deem
just and proper under the circumstances.
The suit is "Jose Aguaristi, et al. v. Comcast Corp., Case No.
108CV115401," filed in the Superior Court of the State of
California in and for the County of Santa Clara.
Representing the plaintiff is:
William E. Kennedy, Esq. (willkennedy@pacbell.net)
Law Office of William E. Kennedy
2797 Park Avenue, Suite 201
Santa Clara, CA 95050
Phone: 408-241-1000
Fax: 408-241-1500
CSX CORP: Directors Breached Fiduciary Duties, Fla. Suit Claims
---------------------------------------------------------------
On June 6, 2008, Louis Steger filed a purported class action
lawsuit in the Circuit Court of the Fourth Judicial Circuit of
the State of Florida, in and for Duval County, against the
directors of CSX Corporation, alleging breaches of fiduciary
duty in connection with the solicitation of proxies in respect
of the CSX 2008 annual meeting of shareholders.
According to the company's June 20, 2008 Form 8-K filing with
the U.S. Securities and Exchange Commission, the plaintiff
seeks, among other things:
(i) injunctive relief directing the directors to cure
alleged misstatements and omissions in the Company's
proxy filings,
(ii) appropriate equity relief to remedy the alleged
breaches of fiduciary duties and
(iii) costs (including attorneys', accountants' and experts'
fees and expenses).
The Company and the directors believe the allegations are
without merit and will defend against them vigorously.
Jacksonville, Fla.-based CSX Corporation is a transportation
company. The Company's rail and intermodal businesses provide
rail-based transportation services including traditional rail
service and the transport of intermodal containers and trailers.
The Company's principal operating company, CSX Transportation,
Inc., provides a crucial link to the transportation supply chain
through about 21,000 route mile rail network, which serves every
major population center in 23 states east of the Mississippi
River, the District of Columbia and the Canadian provinces of
Ontario and Quebec.
DAVE & BUSTER'S: Faces Consolidated Labor Lawsuit in California
---------------------------------------------------------------
Dave & Buster's, Inc., and one of its subsidiaries, are facing a
consolidated lawsuit over alleged violations of state
regulations concerning mandatory meal breaks and rest periods.
Initially, two purported class action complaints were filed in a
California court. These two cases have been consolidated and
coordinated because the potential class members are virtually
identical, according to the company's June 11, 2008 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended May 4, 2008.
The company provided no further detail and reported no
development in the matter in its regulatory filing.
Dave & Buster's, Inc. -- http://www.daveandbusters.com/-- is an
operator of large-format, high-volume, regional entertainment
complexes. Each entertainment complex offers an array of
entertainment attractions, such as pocket billiards,
shuffleboard, interactive simulators and virtual reality
systems, as well as traditional carnival-style games of skill.
The Company's complexes offers food and beverages.
FIRST NLC: Continues to Face FCRA Violations Lawsuit in Illinois
----------------------------------------------------------------
First NLC Financial Services, LLC, continues to face a purported
class action lawsuit alleging violations of Fair Credit
Reporting Act.
The putative class action, "Cerda v. First NLC Financial
Services, LLC," was filed in the U.S. District Court for the
Northern District of Illinois on Feb. 8, 2006.
ACE Securities Corp. Home Equity Loan Trust, Series 2006-HE4
reported no development in the matter in its May 2008 Form 10-
K/A filing with the U.S. Securities and Exchange Commission for
the fiscal year ended Dec. 31, 2006.
The suit is "Cerda v. First NLC Financial Services, LLC, Case
No. 1:06-cv-00735," filed in the U.S. District Court for the
Northern District of Illinois, Judge Mark Filip presiding.
Representing the plaintiff is:
Daniel A. Edelman, Esq.
Edelman, Combs, Latturner & Goodwin, LLC
120 South LaSalle Street, 18th Floor
Chicago, IL 60603
Phone: 312-739-4200
e-mail: courtecl@edcombs.com
Representing the defendant is:
Mitchel H. Kider, Esq. (kider@wbsk.com)
Weiner, Brodsky, Sidman & Kider
1300 Nineteenth Street, NW, Fifth Floor
Washington, DC 20005
Phone: 202-628-2000
FOOT LOCKER: Subsidiaries Face Multiple Labor-Related Lawsuits
--------------------------------------------------------------
Certain subsidiaries of Foot Locker, Inc., are facing a number
of lawsuits in state and federal courts over allegations of
labor-related violations, according to Foot Locker's June 11,
2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended May 3, 2008.
The suits contain various class action allegations under state
wage and hour laws, including allegations concerning
classification of employees as exempt or nonexempt, unpaid
overtime, meal and rest breaks, and uniforms.
Foot Locker, Inc. -- http://www.footlocker-inc.com/-- is a
global retailer of athletic footwear and apparel, operated 3,785
primarily mall-based stores in the U.S., Canada, Europe,
Australia, and New Zealand as of Feb. 2, 2008. The Company,
through its subsidiaries, operates in two segments: Athletic
Stores and Direct-to-Customers. The Athletic Stores segment is
an athletic footwear and apparel retailer, whose formats include
Foot Locker, Lady Foot Locker, Kids Foot Locker, Champs Sports
and Footaction. The Direct-to-Customers segment reflects
Footlocker.com, Inc., which sells, through its affiliates,
including Eastbay, Inc., to customers through catalogs and
Internet Websites. The Foot Locker brand is the Company’s
principal brand.
GENERAL MOTORS: Faces Mo. Suit Over Leaking Avalanche Windows
-------------------------------------------------------------
General Motors Corp. is facing a class-action complaint filed in
the U.S. District Court for the Eastern District of Missouri
alleging its Chevrolet Avalanche has defective, leaky windows,
CourtHouse News Service reports.
Named plaintiff Robert Atwell says he returned his 2006
Avalanche five times for ineffective repairs.
This is an action for damages arising from breach of contract
and breach of implied and express warranty due to defendants'
inability to deliver a merchantable vehicle to Mr. Atwell and
the other class members.
Mr. Atwell brings this action pursuant to Rule 23 of the Federal
Rules of Civil Procedure on behalf of all persons and entities
in the United States and its territories that purchased a
Chevrolet Avalanche.
Mr. Atwell wants the court to rule on:
(a) whether the terms and conditions sales contract between
defendants and class members are substantially similar;
(b) whether the terms and conditions of the express
warranty between defendants and class members are
substantially similar;
(c) whether the water leakage in the Avalanche constitutes
a defect;
(d) whether the Avalanche, as sold, was of merchantable
quality;
(e) whether defendants are merchants with respect to
vehicles such as the Avalanche;
(f) whether the Avalanche, as sold, breached defendants'
express warranty;
(g) whether the Avalanche, as sold, breached defendants'
contract with the class members; and
(h) whether the conduct alleged results in damages to
defendants' customers and, if so, the proper measure of
those damages.
Mr. Atwell requests that the court:
-- determine that this action may be maintained as a class
action, pursuant to the appropriate subsections of Rule
23 of the Federal Rules of Civil Procedure; that the
court certify a class action with respect to particular
issues if appropriate, and that the court designate and
appoint plaintiff and counsel to serve as class
representatives and class counsel;
damages in such amount as to be determined at trial and
-- grant class members awards of actual and compensatory
as provided by applicable law;
-- grant class members their costs of suit, including
reasonable attorneys' fees and expenses as provided by
law;
-- grant class members a rescission of the sale contract
and a refund of all monies paid; and
-- grant class members such other, further, and different
relief as the nature of the case may require or as may
be determined to be just, equitable and proper by the
court.
The suit is "Robert Michael Atwell, et al. v. General Motors
Corp., et al.," filed in the U.S. District Court for the Eastern
District of Missouri.
Representing the plaintiff are:
John J. Carey, Esq.
David W. Bauman, Esq.
Corey Sullivan, Esq.
Carey & Danis, LLC
8235 Forsyth Boulevard, Suite 1100
St. Louis, MO 63105
Phone: 314-725-7700
Fax: 314-721-0905
GLOBAL CROSSING: Ill. Landowners' Rights-of-Way Suit Continues
--------------------------------------------------------------
The Qwest Rights-of-Way Lawsuit faced by subsidiaries of Global
Crossing Ltd. (GX) continues in the U.S. District Court for the
Southern District of Illinois.
In May 2001, a purported class action suit was commenced against
three of Global Crossing's subsidiaries in the U.S. District
Court for the Southern District of Illinois. The complaint
alleges that GX had no right to install a fiber-optic cable in
rights-of-way granted by the plaintiffs to certain railroads.
Pursuant to an agreement with Qwest Communications Corp., GX has
an indefeasible right to use certain fiber-optic cables in a
fiber-optic communications system constructed by Qwest within
the rights-of-way.
The complaint alleges that the railroads had only limited
rights-of-way granted to them that did not include permission to
install fiber-optic cable for use by Qwest or any other
entities.
The action has been brought on behalf of a national class of
landowners whose property underlies or is adjacent to a railroad
right-of-way within which the fiber-optic cables have been
installed.
The suit seeks actual damages in an unstated amount and alleges
that the wrongs done by the Company involve fraud, malice,
intentional wrongdoing, willful or wanton conduct and reckless
disregard for the rights of the plaintiff landowners. The
plaintiffs also request an award of punitive damages.
GX made a demand of Qwest to defend and indemnify it in the
lawsuit. In response, Qwest has appointed defense counsel to
protect GX's interests.
The company's North American network includes capacity purchased
from Qwest on an Indefeasible Right of Use (IRU) basis. Though
the amount of the claim is unstated, an adverse outcome could
have an adverse impact on the company's ability to utilize large
portions of the company's North American network.
This litigation was stayed against the company pending the
effective date of its Plan of Reorganization, and the
plaintiffs' pre-petition claims against the company were
discharged at that time in accordance with the Plan of
Reorganization.
By agreement between the parties, the Plan of Reorganization
preserved plaintiffs' rights to pursue any post-confirmation
claims of trespass or ejectment.
If the plaintiffs were to prevail, the company could lose its
ability to operate large portions of its North American network,
although it believes that it would be entitled to
indemnification from Qwest for any losses under the terms of the
IRU agreement under which the company originally purchased this
capacity.
As part of a global resolution of all bankruptcy claims asserted
against the company by Qwest, Qwest agreed to reaffirm its
obligations of defense and indemnity to the company for the
assertions made in this claim.
In September 2002, Qwest and certain of the other
telecommunication carrier defendants filed a proposed settlement
agreement in the U.S. District Court for the Northern District
of Illinois.
On July 25, 2003, the court granted preliminary approval of the
settlement and entered an order enjoining competing class action
claims, except those in Louisiana.
The settlement and the court's injunction were opposed by a
number of parties who intervened and an appeal was taken to the
U.S. Court of Appeals for the Seventh Circuit.
In a decision dated Oct. 19, 2004, the Court of Appeals reversed
the approval of the settlement and lifted the injunction. The
case has been remanded to the District Court for further
proceedings.
The company reported no further development in the matter in its
May 2008 Form 10-Q filing with the U.S. Securities and Exchange
Commission for quarter ended March 31, 2008.
Global Crossing, Ltd. -- http://www.globalcrossing.com/-- is a
communications solutions provider, offering a suite of Internet
protocol and legacy telecommunications services worldwide.
HILLENBRAND INDUSTRIES: Sept. 8 Docket Call Set for FCA Matter
--------------------------------------------------------------
The U.S. District Court for the Southern District of Texas
scheduled a Sept. 8, 2008 docket call in connection with a
purported class action lawsuit filed by Funeral Consumers
Alliance, Inc., against funeral home businesses, including
Hillenbrand Industries Inc., according to the company's May 2008
Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2008.
On May 2, 2005, FCA, which is a non-profit entity, and several
individual consumers filed a purported antitrust class action
complaint against three national funeral home businesses Service
Corporation International; Alderwoods Group, Inc.; and Stewart
Enterprises, Inc., together with Hillenbrand, and its Batesville
Casket Company Inc. subsidiary, with the U.S. District Court for
the Northern District of California.
The lawsuit alleged:
-- a conspiracy to suppress competition in an alleged
market for the sale of caskets through a group boycott
of so-called independent casket discounters, that is,
third-party casket sellers unaffiliated with licensed
funeral homes;
-- a campaign of disparagement against these independent
casket discounters; and
-- concerted efforts to restrict casket price competition
and to coordinate and fix casket pricing, all in
violation of federal antitrust law and California's
Unfair Competition Law.
The lawsuit claimed, among other things, that Batesville's
maintenance and enforcement of, and alleged modifications to,
its long-standing policy of selling caskets only to licensed
funeral homes were the product of a conspiracy among Batesville,
the other defendants and others to exclude independent casket
discounters and that this alleged conspiracy, combined with
other alleged matters, suppressed competition in the alleged
market for caskets and led consumers to pay higher than
competitive prices for caskets.
The FCA Action further alleged that two of Batesville's
competitors, York Group, Inc., and Aurora Casket Company, are
co-conspirators but did not name them as defendants. The FCA
Action also asserted that SCI, Alderwoods, Stewart and other
unnamed co-conspirators conspired to monopolize the alleged
market for the sale of caskets in the U.S.
After the FCA Action was filed, several more purported class
actions on behalf of consumers were filed based on essentially
the same factual allegations and alleging violations of federal
antitrust law and related state law claims.
Batesville, Hillenbrand, and the other defendants filed motions
to dismiss the FCA Action and a motion to transfer to a more
convenient forum. In response, the court in California
permitted the plaintiffs to replead the complaint and later
granted the defendants' motion to transfer the action to the
U.S. District Court for the Southern District of Texas.
On Oct. 12, 2005, the FCA plaintiffs filed an amended complaint
consolidating all but one of the other purported consumer class
actions in the U.S. District Court for the Southern District of
Texas. The amended FCA complaint contains substantially the
same basic allegations as the original FCA complaint.
The only other then remaining unconsolidated purported consumer
class action, "Fancher v. SCI et al.," was subsequently
dismissed voluntarily by the plaintiff after the defendants
filed a motion to dismiss.
The FCA plaintiffs are seeking certification of a class that
includes all U.S. consumers who purchased Batesville caskets
from any of the funeral home co-defendants at any time during
the fullest period permitted by the applicable statute of
limitations.
On Oct. 18, 2006, the Court denied the defendants' request to
dismiss the amended FCA complaint. Class certification hearings
were then held on the matter in early December 2006. Post-
hearing briefing on the plaintiffs' class certification motions
was completed in March 2007, though briefing on certain
supplemental evidence related to class certification in the FCA
Action also occurred in September 2007 and October 2007. The
Court has not yet ruled on the motions for class certification.
On Aug. 27, 2007, the Court suspended all pending deadlines in
both cases, including the previously set February 2008 trial
date.
The Court reset a docket call in the FCA Action for Sept. 8,
2008. A docket call is typically a status conference with the
Court to set a trial date. It is anticipated that new
deadlines, including a trial date, will not be set until
sometime after the Court has ruled on the motions for class
certification.
The plaintiffs in the FCA Action filed a report indicating that
they are seeking damages ranging from approximately $947 million
to approximately $1.46 billion before trebling.
The suit is "Funeral Consumers Alliance Inc., et al. v. Service
Corp. International, Case No. 4:05-cv-03394," filed in the U.S.
District Court for the Southern District of Texas, Judge Kenneth
M. Hoyt, presiding.
Representing the plaintiffs are:
Jonathan S. Abady, Esq. (jabady@ecbalaw.com)
Emery Celli Brinckerhoff
545 Madison Ave.
New York, NY 10022
Phone: 212-763-5000
Fax: 212-763-5001
- and -
Gordon Ball, Esq. (gball@ballandscott.com)
Ball & Scott
550 W. Main Ave., Ste. 750
Knoxville, TN 37902
Phone: 865-525-7028
Fax: 865-525-4679
Representing the defendants are:
John F. Cove, Jr., Esq. (jcove@bsfllp.com)
Richard Bruce Drubel, Jr., Esq. (rdrubel@bsfllp.com)
Boies Schiller Flexner
Phone: 510-874-1000
603-643-9090
Fax: 510-874-1460
603-643-9010
- and -
Kenneth S. Marks, Esq. (kmarks@susmangodfrey.com)
Susman Godfrey, LLP
1000 Louisiana, Ste. 5100
Houston, TX 77002-5096
Phone: 713-946-9567
Fax: 713-654-6666
HILLENBRAND INDUSTRIES: Sept. 8 Docket Call Set for PVC Matter
--------------------------------------------------------------
The U.S. District Court for the Southern District of Texas
scheduled a Sept. 8, 2008 docket call for the case, "Pioneer
Valley Casket, et al. v. Service Corp. International, et al.,
Cause No. 4:05-CV 03399," which names Hillenbrand Industries,
Inc., as a defendant, according to the company's May 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended March 31, 2008.
On July 8, 2005, Pioneer Valley Casket Co., an alleged casket
store and Internet retailer, filed a purported class action
complaint against Batesville, Hillenbrand, Service Corp.
International, Alderwoods Group Inc. and Stewart Enterprises
Inc. in the U.S. District Court for the Northern District of
California on behalf of the class of "independent casket
distributors."
The complaint alleges violations of state and federal antitrust
law and state unfair and deceptive practices laws based on
essentially the same factual allegations as in the consumer
cases.
Pioneer Valley claimed that it and other independent casket
distributors were injured by the defendants' alleged conspiracy
to boycott and suppress competition in the alleged market for
caskets, and by an alleged conspiracy among SCI, Alderwoods,
Stewart and other unnamed co-conspirators to monopolize the
alleged market for caskets.
The plaintiff Pioneer Valley seeks certification of a class of
all independent casket distributors who are now in business or
have been in business since July 8, 2001.
Pioneer Valley generally seeks actual unspecified monetary
damages on behalf of the purported class, trebling of any such
damages that may be awarded, recovery of attorneys' fees and
costs and injunctive relief.
The Pioneer Valley complaint was transferred to the U.S.
District Court for the Southern District of Texas but was not
consolidated with the action, "Funeral Consumers Alliance Inc.
et al. v. Service Corp. International, Case No. 4:05-cv-03394,"
although the scheduling orders for both cases are identical.
On Oct. 21, 2005, Pioneer Valley filed an amended complaint
adding three new plaintiffs, each of whom purports to be a
current or former "independent casket distributor."
Like Pioneer Valley's original complaint, the amended complaint
alleges violations of federal antitrust laws, but it has dropped
the causes of actions for alleged price fixing, conspiracy to
monopolize, and violations of state antitrust law and state
unfair and deceptive practices laws.
On Oct. 25, 2006, the district court denied a motion by the
defendants to have the amended Pioneer Valley complaint
dismissed. Class certification hearings on the FCA Action and
the Pioneer Valley Action were then held in early December 2006.
Post-hearing briefing on the plaintiffs' class certification
motions in both cases was completed in March 2007, though
briefing on certain supplemental evidence related to class
certification in the FCA Action also occurred in September 2007
and October 2007.
The Court has not yet ruled on the motions for class
certification.
On Aug. 27, 2007, the Court suspended all pending deadlines in
both cases, including the previously set February 2008 trial
date.
The Court reset a docket call in the FCA Action for Sept. 8,
2008. A docket call is typically a status conference with the
Court to set a trial date. It is anticipated that new
deadlines, including a trial date, will not be set until
sometime after the Court has ruled on the motions for class
certification.
The plaintiffs in the Pioneer Valley Action generally seek
monetary damages, trebling of any such damages that may be
awarded, recovery of attorneys fees and costs, and injunctive
relief. The Pioneer Valley plaintiffs filed a report indicating
that they are seeking damages of approximately $99.2 million
before trebling.
The suit is "Pioneer Valley Casket, et al. v. Service Corp.
International, et al., Cause No. 4:05-CV-03399," filed in the
U.S. District Court for the Southern District of Texas, Judge
Kenneth M. Hoyt presiding.
Representing the plaintiffs are:
Thomas E. Bilek, Esq. (tbilek@hb-legal.com)
Hoeffner and Bilek, LLP
1000 Louisiana, Suite 1302
Houston, TX 77002
Phone: 713-227-7720
Fax: 713-227-9404
Robert S. Green, Esq. (rsg@CLASSCOUNSEL.COM)
Green Welling, LLP
595 Market Street, Suite 2750
San Francisco, CA 94105
Phone: 415-477-6700
Fax: 415-477-6710
- and -
Christine P. Bartholomew, Esq.
(cbartholomew@finkelsteinthompson.com)
Finkelstein Thompson & Loughran
601 Montgomery Street, Suite 665
San Francisco, CA 94111
Phone: 415-398-8700
Fax: 415-398-8704
Representing the company is:
Andrew M. Edison, Esq.
(andrew.edison@bracewellgiuliani.com)
Bracewell and Giuliani, LLP
711 Louisiana, Ste. 2300
Houston, TX 77002
Phone: 713-221-1371
Fax: 713-221-2144
HILLENBRAND INDUSTRIES: Nov. 3 Trial Set for "Staples" Lawsuit
--------------------------------------------------------------
A Nov. 3, 2008 trial date was set for the purported class action
lawsuit captioned, "Vertie Staples v. Batesville Casket Company,
Inc., Case No. 5:2007cv00214," which names Hillenbrand
Industries, Inc., as a defendant.
On Aug. 17, 2007, the lawsuit was filed against the company in
the U.S. District Court for the Eastern District of Arkansas.
The case is a putative class action suit on behalf of the
plaintiff and all others who purchased a Monoseal casket
manufactured by Batesville from a licensed funeral home located
in Arkansas from Jan. 1, 1989, to the present.
The plaintiff claims that Monoseal caskets were marketed as
completely resistant to the entrance of air and water when they
allegedly were not resistant. The plaintiff asserts causes of
action under the Arkansas Deceptive Trade Practices Act and for
fraud, constructive fraud and breach of express and implied
warranties.
On Jan. 9, 2008, the plaintiff filed an amended complaint that
added another putative class plaintiff, restated the pending
claims, and added a claim for unjust enrichment.
In order to establish federal jurisdiction over the claims under
the Class Action Fairness Act, the plaintiff alleges that the
amount in controversy exceeds $5 million.
Though the action is in the very early stages of litigation, a
trial date of Nov. 3, 2008, has been scheduled.
The company reported no further 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.
The suit is "Vertie Staples v. Batesville Casket Company, Inc.,
Case No. 5:2007cv00214," filed in the U.S. District Court for
the Eastern District of Arkansas, Judge James M. Moody,
presiding.
Representing the plaintiff are:
Charles P. Boyd, Jr., Esq. (boyd_law_firm@yahoo.com)
The Boyd Law Firm
Post Office Box 3494
Little Rock, AR 72203-3494
Phone: 501-372-0770
- and -
Thomas P. Thrash, Esq. (tomthrash@sbcglobal.net)
Thrash Law Firm
1101 Garland Street
Little Rock, AR 72201
Phone: 501-374-1058
Representing the defendants is:
Jess L. Askew, III, Esq. (jaskew@williamsanderson.com)
Williams & Anderson, PLLC
111 Center Street, Suite 2200
Little Rock, AR 72201-2413
Phone: 501-372-0800
KNIGHT INC: Discovery Continues in "Going Private" Lawsuits
-----------------------------------------------------------
Consolidated discovery is ongoing in two purported class action
lawsuits against Knight, Inc. -- formerly Kinder Morgan, Inc. --
over a proposed "Going Private" Transaction.
On May 28, 2006, Richard D. Kinder; the company's chairman and
chief executive officer together with other members of Kinder
Morgan's management; co-founder Bill Morgan; current board
members Fayez Sarofim and Mike Morgan; and investment partners
Goldman Sachs Capital Partners, American International Group
Inc., The Carlyle Group, and Riverstone Holdings LLC, submitted
a proposal to the company's Board of Directors to acquire all of
the company's outstanding common stock at a price of $100 per
share in cash.
On Aug. 28, 2006, Kinder Morgan entered into a definitive merger
agreement with Knight Holdco LLC and Knight Acquisition Co. to
effectuate the transaction at a price of $107.50 per share in
cash.
Beginning on May 29, 2006, and in the days following, eight
putative class action complaints were filed in Harris County
(Houston), Texas, and seven putative class action lawsuits were
filed in Shawnee County (Topeka), Kansas, against, among others,
Kinder Morgan, its Board of Directors, and several corporate
officers.
Harris County, Texas Cases
1. "Mary Crescente v. Kinder Morgan, Inc., Richard D.
Kinder, Edward H. Austin, Charles W. Battey, Stewart
A. Bliss, Ted A. Gardner, William J. Hybl, Michael C.
Morgan, Edward Randall III, Fayez S. Sarofim, H.A.
True III, Douglas W.G. Whitehead, and James M.
Stanford, Cause No. 2006-33011," filed in the 164th
Judicial District Court, Harris County, Texas;
2. "CWA/ITU Negotiated Pension Plan, individually and on
behalf of others similarly situated v. Kinder Morgan,
Inc., Richard D. Kinder, Edward H. Austin, Jr.,
William J. Hybl, Ted A. Gardner, Charles W. Battery,
H.A. True, III, Fayez Sarofim, James M. Stanford,
Michael C. Morgan, Stewart A. Bliss, Edward Randall,
III, and Douglas W.G. Whitehead, Cause No. 2006-
39364," filed in the 129th Judicial District Court,
Harris County, Texas;
3. "Robert Kemp, on behalf of himself and all other
similarly situated v. Richard D. Kinder, Edward H.
Austin, Jr., William J. Hybl, Ted A. Gardner, Charles
W. Battey, H.A. True, III, Fayez Sarofim, James
Stanford, Michael C. Morgan, Stewart A. Bliss, Edward
Randall III, Douglas W. G. Whitehead, Kinder Morgan,
Inc., GS Capital Partners V Fund, L.P., AIG Global
Asset Management Holdings Corp., Carlyle Partners IV,
L.P., and Carlyle/Riverstone Energy Partners III,
L.P., Cause No. 2006-33015," filed in the 113th
Judicial District Court, Harris County, Texas;
4. "Dean Drulias v. Kinder Morgan, Inc., Richard D.
Kinder, Edward H. Austin, Jr., William J. Hybl, Ted A.
Gardner, Charles W. Battey, H.A. True III, Fayez S.
Sarofim, James Stanford, Michael C. Morgan, Stewart A.
Bliss, Edward Randall III, Douglas W.G. Whitehead,
Goldman Sachs, American International Group, Inc., the
Carlyle Group, and Riverstone Holdings, LLC, Cause No.
2006-34594," filed in the 333rd Judicial District
Court, Harris County, Texas;
5. "J. Robert Wilson, On Behalf of Himself and All Others
Similarly Situated v. Kinder Morgan, Inc., Richard D.
Kinder, Michael C. Morgan, Fayez Sarofim, Edward H.
Austin, Jr., William J. Hybl, Ted A. Gardner, Charles
W. Battey, H.A. True, III, James M. Stanford, Stewart
A. Bliss, Edward Randall, III, Douglas W.G. Whitehead,
Bill Morgan, Goldman Sachs Capital Partners, American
International Group, Inc., The Carlyle Group,
Riverstone Holdings, L.L.C., C. Park Shaper, Steven J.
Kean, Scott E. Parker, and Tim Bradley, Cause No.
2006-40027," filed in the 270th Judicial District
Court, Harris County, Texas;
6. "Sandra Donnelly, On Behalf of Herself and All Others
Similarly Situated v. Kinder Morgan, Inc., Richard D.
Kinder, Michael C. Morgan, Fayez S. Sarofim, Edward H.
Austin, Jr., William J. Hybl, Ted A. Gardner, Charles
W. Battey, H.A. True III, James M. Stanford, Stewart
A. Bliss, Edward Randall III, and Douglas W.G.
Whitehead, Cause No. 2006-33042," filed in the 61st
Judicial District Court, Harris County, Texas;
7. "David Zeitz, On Behalf of Himself and All Others
Similarly Situated v. Richard D. Kinder, Cause No.
2006-34520," filed in the 234th Judicial District
Court, Harris County, Texas; and
8. "Robert L. Dunn, Trustee for the Dunn Marital Trust,
and the Police & Fire Retirement System of the City of
Detroit v. Richard D. Kinder, Edward H. Austin, Jr.,
William J. Hybl, Ted A. Gardner, Charles W. Battey,
H.A. True, III, Fayez Sarofim, James M. Stanford,
Michael C. Morgan, Stewart A. Bliss, Edward Randall
III, and Douglas W.G. Whitehead, Cause No. 2006-
36184," filed in the 127th Judicial District Court,
Harris County, Texas.
By order of the Court dated June 26, 2006, these cases have been
consolidated into the case captioned, "Crescente v. Kinder
Morgan, Inc., et al." in the 164th Judicial District Court,
Harris County, Texas, which challenges the proposed transaction
as inadequate and unfair to Kinder Morgan's public stockholders.
Seven of the eight original petitions consolidated into this
lawsuit raised virtually identical allegations.
One of the eight original petitions (Zeitz) challenges the
proposal as unfair to holders of the common units of Kinder
Morgan Energy Partners and listed shares of Kinder Morgan
Management.
On Sept. 8, 2006, interim class counsel filed the consolidated
petition for breach of fiduciary duty and aiding and abetting,
in which they alleged that Kinder Morgan's board of directors
and certain members of senior management breached their
fiduciary duties and the sponsor-investors aided and abetted the
alleged breaches of fiduciary duty in entering into the merger
agreement. They seek, among other things, to enjoin the merger,
rescission of the merger agreement, disgorgement of any improper
profits received by the defendants, and attorneys' fees.
The defendants filed answers to the consolidated petition on
Oct. 9, 2006, denying the plaintiffs' substantive allegations
and denying that the plaintiffs are entitled to relief.
Shawnee County, Kansas Cases
1. "Michael Morter v. Richard D. Kinder, Edward H.
Austin, Jr., Charles W. Battey, Stewart A. Bliss, Ted
A. Gardner, William J. Hybl, Michael C. Morgan, Edward
Randall, III, Fayez S. Sarofim, H.A. True, III, and
Kinder Morgan, Inc., Cause No. 06C 801," filed in the
District Court of Shawnee County, Kansas, Division 12;
2. "Teamsters Joint Counsel No. 53 Pension Fund v.
Richard D. Kinder, Edward H. Austin, Charles W.
Battey, Stewart A. Bliss, Ted A. Gardner, William J.
Hybl, Michael C. Morgan, Edward Randall, III, Fayez S.
Sarofim, H.A. True, III, and Kinder Morgan, Inc.,
Cause No. 06C 841," filed in the District Court of
Shawnee County, Kansas, Division 12;
3. "Ronald Hodge, Individually And On Behalf Of All
Others Similarly Situated v. Kinder Morgan, Inc.,
Richard D. Kinder, Edward H. Austin, Jr., William J.
Hybl, Ted A. Gardner, Charles W. Battery, H.A. True
III, Fayez S. Sarofim, James M. Stanford, Michael C.
Morgan, Stewart A. Bliss, Edward Randall, III, and
Douglas W.G. Whitehead, Cause No. 06C 813, filed in
the District Court of Shawnee County, Kansas, Division
6;"
4. "Robert Cohen, Individually And On Behalf Of All
Others Similarly Situated v. Kinder Morgan, Inc.,
Richard D. Kinder, Edward H. Austin, Jr., William J.
Hybl, Ted A. Gardner, Charles W. Battery, H.A. True,
III, Fayez Sarofim, James M. Stanford, Michael C.
Morgan, Stewart A. Bliss, Edward Randall, III, and
Douglas W.G. Whitehead, Cause No. 06C-864," filed with
the District Court of Shawnee County, Kansas, Division
6;"
5. "Robert P. Land, individually, and on behalf of all
others similarly situated v. Edward H. Austin, Jr.,
Charles W. Battey, Stewart A. Bliss, Ted A. Gardner,
William J. Hybl, Edward Randall, III, James M.
Stanford, Fayez Sarofim, H.A. True, III, Douglas W.G.
Whitehead, Richard D. Kinder, Michael C. Morgan, AIG
Global Asset Management Holdings Corp., GS Capital
Partners V Fund, LP, The Carlyle Group LP, Riverstone
Holdings LLC, Bill Morgan and Kinder Morgan, Inc.,
Cause No. 06C-853," filed in the District Court of
Shawnee County, Kansas, Division 6;"
6. "Dr. Douglas Geiger, individually, and on behalf of
all others similarly situated v. Edward H. Austin,
Jr., Charles W. Battey, Stewart A. Bliss, Ted A.
Gardner, William J. Hybl, Edward Randall, III, James
M. Stanford, Fayez Sarofim, H.A. True, III, Douglas
W.G. Whitehead, Richard D. Kinder, Michael C. Morgan,
AIG Global Asset Management Holding Corp., GS Capital
Partners V Fund, LP, The Carlyle Group LP, Riverstone
Holdings LLC, Bill Morgan and Kinder Morgan, Inc.,
Cause No. 06C-854," filed in the District Court of
Shawnee County, Kansas, Division 6;" and
7. "John Bolton, On Behalf of Himself and All Others
Similarly Situated v. Kinder Morgan, Inc., Richard D.
Kinder, Michael C. Morgan, Fayez Sarofim, Edward H.
Austin, Jr., William J. Hybl, Ted A. Gardner, Charles
W. Battey, H.A. True, III, James M. Stanford, Stewart
A. Bliss, Edward Randall, III, Douglas W.G. Whitehead,
William V. Morgan, Goldman Sachs Capital Partners,
American International Group, Inc., The Carlyle Group,
Riverstone Holdings LLC, C. Park Shaper, Steven J.
Kean, Scott E. Parker and Tim Bradley, Case No. Cause
No. 06C-837," filed in the District Court of Shawnee
County, Kansas, Division 6;
By order of the Court dated June 26, 2006, the Kansas cases have
been consolidated, under the caption, "In Re Kinder Morgan, Inc.
Shareholder Litigation, Case No. 06 C 801," filed with the
District Court of Shawnee County, Kansas, Division 12.
On Aug. 1, 2006, the Court selected lead plaintiffs' counsel in
the Kansas State Court proceedings.
On Aug. 28, 2006, the plaintiffs filed their consolidated and
amended class action petition in which they alleged that Kinder
Morgan's board of directors and certain members of senior
management breached their fiduciary duties and the sponsor-
investors aided and abetted the alleged breaches of fiduciary
duty in entering into the merger agreement.
The plaintiffs seek, among other things, to enjoin the
stockholder vote on the merger agreement and any action taken to
effect the acquisition of Kinder Morgan and its assets by the
buyout group, damages, disgorgement of any improper profits
received by the defendants, and attorney’s fees.
The Two Consolidated Cases
On Oct. 12, 2006, the District Court of Shawnee County, Kansas
entered a Memorandum Decision and Order in which it ordered the
parties in both the "Crescente v. Kinder Morgan, Inc. et al."
case pending in Harris County Texas and the "In Re Kinder
Morgan, Inc. Shareholder Litigation" pending in Shawnee County
Kansas to confer and to submit to the court recommendations for
the "appointment of a Special Master or a Panel of Special
Masters to control all of the pretrial proceedings in both the
Kansas and Texas Class Actions arising out of the proposed
private offer to purchase the stock of the public shareholders
of Kinder Morgan, Inc."
By Order dated Nov. 21, 2006, the Kansas District Court
appointed the Honorable Joseph T. Walsh to serve as Special
Master for In Re Kinder Morgan Inc. Shareholder Litigation case
pending in Kansas.
By Order dated Dec. 6, 2006, the Texas District Court also
appointed the Honorable Joseph T. Walsh to serve as Special
Master in the "Crescente v. Kinder Morgan, Inc. et al." case
pending in Texas for the purposes of considering any
applications for pretrial temporary injunctive relief.
On Nov. 21, 2006, the plaintiffs in "In Re Kinder Morgan, Inc.
Shareholder Litigation" filed a third amended class action
petition with Special Master Walsh. This Petition was later
filed under seal with the Kansas District Court on Dec. 27,
2006. The defendants' answer to the third amended class action
petition was filed in March 2007.
Following extensive expedited discovery, the plaintiffs in both
consolidated actions filed an application for a preliminary
injunction to prevent the holding of a special meeting of
shareholders for the purposes of voting on the proposed merger,
which was scheduled for Dec. 19, 2006.
The application was briefed by the parties between Dec. 4, 2006,
and Dec. 13, 2006, and oral argument was heard by Special Master
Walsh on Dec. 14, 2006.
On Dec. 18, 2006, Special Master Walsh issued a Report and
Recommendation concluding, among other things, that "plaintiffs
have failed to demonstrate the probability of ultimate success
on the merits of their claims in this joint litigation."
Accordingly, the Special Master concluded that the plaintiffs
were "not entitled to injunctive relief to prevent the holding
of the special meeting of KMI shareholders scheduled for
December 19, 2006."
The parties are currently engaged in consolidated discovery in
these matters, according to Knight, Inc.'s May 2008 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2008.
Knight Inc. -- http://www.kindermorgan.com/-- formerly Kinder
Morgan, Inc., is an energy transportation and storage company in
North America. Its pipelines transport natural gas, gasoline,
crude oil, carbon dioxide and other products, and its terminals
store petroleum products and chemicals and handle bulk materials
like coal and petroleum coke. Knight is also an independent
provider of carbon dioxide (CO2) for oil recovery projects in
North America. principal business segments are Natural Gas
Pipeline Company of America and certain affiliates, referred to
as Natural Gas Pipeline Company of America, Power, Express
Pipeline System, Products Pipelines-KMP, Natural Gas Pipelines-
KMP, CO2-KMP and Terminals-KMP. On Aug. 28, 2006, the Company
entered into an agreement and plan of merger whereby it would
merge with a wholly owned subsidiary of Knight Holdco LLC. On
May 30, 2007, the merger closed, with Kinder Morgan, Inc.
continuing as the surviving legal entity and subsequently
renamed Knight, Inc.
NEW CENTURY: Indiana Court Yet to Approve FCRA Suit Settlement
--------------------------------------------------------------
The U.S. District Court for the Northern District of Indiana has
yet to grant preliminary approval to the settlement of a
purported class action lawsuit against New Century Mortgage
Corp., alleging violations of the Fair Credit Reporting Act.
Perrie Bonner and Darrell Bruce filed the suit against the
company and Home123 Corp. in April 2005. The suit claimed that
the company and Home123 accessed consumer credit reports without
authorization because the pre-screened offers of credit did not
qualify as firm offers of credit.
The proposed class consists of all persons in Indiana, Illinois
and Wisconsin who received the pre-screened offers from
April 20, 2003, to May 10, 2005.
The company and Home 123 filed their answer to the complaint on
June 30, 2005. In September 2005, the plaintiffs filed a motion
for class certification and on Nov. 1, 2005, the company and
Home123 filed a motion for judgment on the pleadings.
In August 2006, the court granted the plaintiffs' motion for
class certification. The class size is limited to the Northern
District of Indiana.
On March 9, 2007, the court heard the motion for summary
judgment, and ruled that the defendants' solicitation did not
constitute a "firm offer of credit", and that plaintiff Bonner's
claim that the disclosure was not "clear and conspicuous" was
moot.
On March 12, 2007, this action settled on a class-wide basis
(Northern District of Indiana). On March 16, 2007, the parties
moved for preliminary approval of the settlement. The court has
not yet granted this interim approval.
ACE Securities Corp. Home Equity Loan Trust, Series 2006-SL1
reported no further development in the matter in its May 2008
Form 10-K/A filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2006.
The suit is "Bonner, et al. v. Home123 Corp., et al., Case No.
2:05-cv-00146-PPS-APR," filed in the U.S. District Court for the
Northern District of Indiana, Judge Philip P. Simon, presiding.
Representing the plaintiffs are:
Daniel A. Edelman, Esq. (dedelman@edcombs.com)
Jeremy P. Monteiro, Esq. (jmonteiro@edcombs.com)
Edelman Combs Latturner & Goodwin LLC
120 S. LaSalle Street, Suite 1800
Chicago, IL 60603
Phone: 312-739-4200
Fax: 312-419-0379
Representing the company is:
Mayer Brown Rowe and Maw LLP
71 S. Wacker Drive
Chicago, IL 60606
Phone: 312-782-0600
Fax: 312-701-7711
e-mail: vcollado@mayerbrownrowe.com
lnale@mayerbrownrowe.com
drsabol@mayerbrownrowe.com
NEW CENTURY: Fourth Amended Complaint Filed in Calif. Wage Suit
---------------------------------------------------------------
The parties in "Daniel J. Rubio v. New Century Mortgage Corp.,
et al.," which is pending with the U.S. District Court for the
Central District of California agreed to the filing of a fourth
amended complaint in the matter.
In March 2005, Daniel J. Rubio, a former employee of New Century
Mortgage Corp., filed a lawsuit in the Superior Court of Orange
County, California, alleging failure to pay overtime wages,
failure to provide meal and rest periods, and engagement in
unfair business practices in violation of the California Labor
Code. The complaint seeks recovery of unpaid wages, interest,
and attorneys' fees and costs.
The company was served with the complaint on March 22, 2005.
The company filed a motion to strike and a demurrer to the
complaint in May 2005. On July 8, 2005, the court overruled the
demurrer and granted the motion to strike.
An amended complaint was filed in July 2005 and the company
filed its answer in August 2005. In December 2005, the company
filed a motion to strike portions of the complaint, which was
granted in its favor, limiting the statute of limitations for
plaintiff's meal and rest period claims to one year.
The court reconsidered and reversed its ruling in May 2006. A
second amended complaint was filed by the plaintiff, adding a
cause of action for failure to pay overtime in violation of the
FLSA.
In July 2006, mediation occurred, followed by New Century
Mortgage's removal of the case to the U.S. District Court for
the Central District of California in August 2006.
In September 2006, the court again granted New Century
Mortgage's motion to strike, limiting the statute of limitations
for plaintiff's meal and rest period claims to one year. The
plaintiff's third amended complaint was filed in October 2006.
In December 2006, the court granted New Century Mortgage's
motion to strike the punitive damages allegations from the
plaintiff's third amended complaint and denied New Century
Mortgage's motion to dismiss the sixth cause of action for
alleged wage statement violations.
In December 2006, the parties stipulated to the plaintiff's
filing of a fourth amended complaint, adding plaintiffs John
Hicks and David Vizcarra.
ACE Securities Corp. Home Equity Loan Trust, Series 2006-SL1
reported no development in the matter in its May 2008 Form 10-
K/A filing with the U.S. Securities and Exchange Commission for
the fiscal year ended Dec. 31, 2006.
The suit is "Daniel J. Rubio v. New Century Mortgage Corp., et
al., Case No. 8:06-cv-00811-CJC-AJW," filed in the U.S. District
Court for the Central District of California, Judge Cormac J.
Carney, presiding.
Representing the plaintiffs are:
Kevin T. Barnes, Esq. (barnes@kbarnes.com)
Kevin T. Barnes Law Offices
5670 Wilshire Blvd., Suite 1460
Los Angeles, CA 90036
Phone: 323-549-9100
- and -
James M. Trush, Esq. (jtrush@earthlink.net)
Trush Law Offices
1920 Main Street, Suite 900
Irvine, CA 92614
Phone: 949-581-9090
Representing the defendants is:
Greg S. Labate, Esq.
Sheppard Mullin Richter & Hampton
650 Town Center Drive, 4th Floor
Costa Mesa, CA 92626-1993
Phone: 714-513-5100
Fax: 714-513-5130
NEW CENTURY: Parties Seek Dismissal of "Forrest" Case in Calif.
---------------------------------------------------------------
The parties in the purported class action, "Forrest v. New
Century Mortgage Corporation," are seeking the dismissal of the
matter, which is pending with the U.S. District Court for the
Central District of California.
The plaintiff, Mary Forrest, who filed the suit in January 2006,
alleged violations of the Fair Credit Reporting Act. Ms.
Forrest claimed that the originator accessed pre-screened credit
reports without authorization, because the offers of credit
allegedly did not qualify as firm offers of credit.
The proposed class consisted of persons with Wisconsin addresses
to whom the originator sent a particular pre-screened offer of
credit after Nov. 20, 2004.
In February 2006, the company filed both its answer and a motion
to transfer the case to the U.S. District Court for the Central
District of California.
In June 2006, the court granted New Century Mortgage's motion to
transfer and transferred the case from the U.S. District Court
for the District of Wisconsin to the U.S. District Court for the
Central District of California.
In July 2006, New Century Mortgage filed a Notice of Related
Case to consolidate this matter with the Phillips class action.
On March 11, 2007, the action settled by the parties. A
stipulation for dismissal of individual claims dismissed with
prejudice and claims of putative class members dismissed without
prejudice was filed with the court.
ACE Securities Corp. Home Equity Loan Trust, Series 2006-SL1
reported no further development in the matter in its May 2008
Form 10-K/A filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2006.
The suit is "Forrest v. New Century Mortgage Corporation, Case
No. 2:06-cv-00010-RTR," filed in the U.S. District Court for the
Eastern District of Wisconsin, Judge Rudolph T. Randa,
presiding.
Representing the plaintiffs is:
John D. Blythin, Esq. (jblythin@ademilaw.com)
Ademi & O'Reilly, LLP
3620 E. Layton Ave.
Cudahy, WI 53110
Phone: 414-482-8000
Fax: 414-482-8001
Representing the defendants are:
Sarah J. Friday, Esq. (sjf@kravitlaw.com)
Kravit Hovel Krawczyk & Leverson, SC
825 N. Jefferson St., 5th Fl.
Milwaukee, WI 53202
Phone: 414-271-7100
Fax: 414-271-81335
- and -
Bruce A. Friedman, Esq.
Alschuler Grossman Stein & Kahan, LLP
9th Tower, 1620 26th St., 4th Fl.
Santa Monica, CA 90404-4060
Phone: 310-907-1000
Fax: 310-907-2000
NEW CENTURY: Still Faces Securities Fraud Lawsuits in California
----------------------------------------------------------------
New Century Financial Corp. continues to face several purported
securities fraud class action lawsuits filed in a California
federal court.
On Feb. 8, 2007, Avi Gold filed a securities class action
complaint in the U.S. District Court for the Central District of
California against the company and certain of its directors and
officers.
The original complaint alleges that the defendants violated
federal securities laws by issuing false and misleading
statements and failing to disclose material facts about the
company, which resulted in artificially inflated market prices
of the company's common stock. The purported class period is
between April 7, 2006, and Feb. 7, 2007.
The original complaint seeks money damages in favor of its
purported class of purchasers of the company's securities, the
costs and expenses of the action and other relief that may be
granted by the court.
The company has also learned that 17 additional purported class
action complaints were filed in the U.S. District Court for the
Central District of California between Feb. 8, 2007, and
March 16, 2007.
These complaints, some of which the company has not yet been
served with and which name the company and certain of its
officers and directors as defendants, present in large degree
the same legal and factual issues as the original complaint and
allege various class periods, the longest of which is from
April 7, 2006, to March 2, 2007.
One of these class action suits has been brought on behalf of
the holders of the company's 9.125% Series A Cumulative
Redeemable Preferred Stock (Series A Preferred Stock) and the
holders of the company's 9.75% Series B Cumulative Redeemable
Preferred Stock (Series B Preferred Stock).
Another of these class actions has been brought on behalf of the
holders of the company's Series B Preferred Stock.
ACE Securities Corp. Home Equity Loan Trust, Series 2006-SL1
reported no further development in the matter in its May 2008
Form 10-K/A filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2006.
New Century Financial Corp. -- http://www.ncen.com/-- is a real
estate investment trust, and through its subsidiaries, operates
one of the mortgage finance companies. The Company originates
and purchases primarily first-mortgage loans worldwide. It
focuses on lending to individuals whose borrowing needs are
generally not fulfilled by traditional financial institutions
because they do not satisfy the credit, documentation or other
underwriting standards prescribed by conventional mortgage
lenders and loan buyers. The Company originates and purchases
mortgage loans through two divisions: Wholesale Division and
Retail Division. In September 2005, the New Century acquired a
mortgage origination platform from RBC Mortgage Co., which
expands its offerings to include conventional mortgage loans,
including Alt-A mortgage loans, loans insured by the Federal
Housing Administration, and loans guaranteed by the Veterans
Administration (VA).
NORTH AMERICAN: Faces Suit in N.J. Over Discharge Recording Fees
----------------------------------------------------------------
North American Title Agency -- d/b/a Independence Abstract and
Title Agency -- is facing a class-action complaint before the
U.S. District Court for the District of New Jersey alleging it
charges a fee for recording the discharge of a prior mortgage at
closings, though previous lenders did that work, and charged for
it, CourtHouse News Service reports.
The plaintiffs sue for violations of the Real Estate Settlement
Practices Act, 12 USC Section 2601, et seq., consumer fraud
pursuant to NJSA Sections 56:8-1 et seq., and common law breach
of contract, breach of contractual duty of good faith and fair
dealing, breach of fiduciary duty and unjust enrichment.
The basis of the claim is that defendant is improperly charging
plaintiffs and the class, at closing, a fee for a phantom
service -- recording the discharge of the prior mortgage -- a
service that has been performed by another party, and for which
plaintiffs ad the class have already paid.
The plaintiff brings this class action pursuant to Rule 23(a),
and 23(b)(3) of the Federal Rules of Civil Procedure on behalf
of all persons or entities who, from six years prior to the
filing date to the present, were charged fees in connection with
real estate transactions in Arizona, California, Colorado,
Florida, Illinois, Maryland, Minnesota, Nevada, New Jersey,
Pennsylvania, Texas, Virginia, and the District of Columbia by
North American Title Company or its predecessor Independence
Abstract & Title Agency for recording releases of mortgages and
on whose behalf North American Title Company or Independence
Abstract & Title Agency did not record the release.
The plaintiff wants the court to rule on:
(a) whether defendant violated RESPA by charging recording
fees for services it did not provide;
(b) whether defendant's conduct violated the New Jersey
Consumer Fraud Act;
(c) whether defendant's conduct constituted a breach of its
contracts with members of the plaintiff class;
(d) whether defendant was unjustly enriched by the receipt
of fees for services it did not perform;
(e) whether defendant participated in and pursued a common
course of conduct to defraud the members of the
plaintiff class;
(f) whether defendant's conduct harmed the members of the
plaintiff class economically;
(g) the amount and nature of the disgorgement and
restitution to be imposed due to defendant's improper
collection of fees for which it performed no service;
(h) whether defendants made express representations
regarding the fees charged and the services to be
provided in return for payment of those fees;
(i) the nature and amount of any additional relief to which
plaintiffs and the class are entitled.
The plaintiff asks the court for:
-- judgment in favor of plaintiff and the class,
specifically:
(a) an order pursuant to Fed. R. Civ. P. 23, permitting
this action to be maintained as a class action on
behalf of the class as specified, appointing
plaintiff as class representative and plaintiff's
counsel as class counsel;
(b) awarding restitution and all appropriate
compensatory damages, including treble damages, for
monies expended by class members for the wrongful
charged for recording fees;
-- plaintiffs' costs and disbursements, including
reasonable plaintiffs' counsel's fees; and
-- such further relief as the court deems necessary, just
and proper.
The suit is "Arthur R. and Jane M. Tubbs, et al. v. North
American Title Agency d/b/a Independence Abstract and Title
Agency, Case No. 1:33-av-00001," filed in the U.S. District
Court for the District of New Jersey.
Representing the plaintiff are:
Robert J. LaRocca, Esq.
Hadley Perkins Roeltgen, Esq.
Kohn, Swift & Graf PC
One South Broad Street, Suite 2100
Philadelphia, PA 19107
Phone: 215-238-1700
PERPETUAL STORAGE: Suit Launched Over Stolen U. Billing Records
---------------------------------------------------------------
With the billing records of 2.2 million patients at the
University of Utah Hospital and Clinics still missing, a
proposed class-action lawsuit has been filed earlier this month,
Aaron Falk writes for Deseret News.
U. patient Patrick M. Beamish claims that a courier for
Perpetual Storage Inc. acted negligently in transporting the
records, resulting in their theft and putting millions of people
at "significant risk" of identity theft, according to the
lawsuit.
"Our main interest is making sure everyone is protected," Karra
J. Porter, Esq., at Christensen & Jensen, in Salt Lake, told
Deseret News. "This isn't a money maker for us. Protection is
the key concern."
The report recounts that hospital officials, on June 10,
announced that the records of 2.2 million patients, dating back
16 years, had been stolen. Tapes containing a backup of the
hospital's master billing records had been picked up by a
Perpetual Storage courier on the afternoon of June 1. However,
instead of using a secure van, the courier violated company
policy by using his personal vehicle, the officials said.
The officials further related that instead of taking the records
to Perpetual Storage's secure vault in Little Cottonwood Canyon,
the courier took them to his home in Kearns, leaving the tapes
inside a metal box on the front seat of his car overnight. In
the early morning hours of June 2, police said, someone smashed
the car's window and took the box and the tapes inside.
According to Deseret News, already, patients are lining up to be
a part of the proposed class-action lawsuit. "Judging by the
number of phone calls we're already receiving, it's going to be
substantial," Ms. Porter said.
Deseret News points out that the U. has not been named in any
lawsuits pertaining to the breach, but Mr. Porter said her firm
could file a complaint. "We're playing phone tag with the U.,"
she said, as of Deseret News press time, with regard to the
story. "As a courtesy, we have not yet filed our notice of
claim against them."
Hospital spokesman Chris Nelson declined to comment to Deseret
News regarding any pending litigation. "Our focus right now is
on moving forward and making sure our patients are notified," he
said.
According to the report, more than 2.2 million notifications are
in the process of being mailed out to affected patients. The
hospital has offered a free year of credit monitoring to the 1.3
million patients whose Social Security numbers were included in
the stolen records.
Mr. Beamish is suing for immediate and ongoing credit monitoring
and unconditional credit repair for any damages sustained. In
suing for damages, Mr. Beamish and his attorneys may seek the
creation of an escrow account to remedy any future problems that
may arise from the breach.
"Credit monitoring is helpful because it tells you when
something has happened," Ms. Porter said. "It doesn't fix it."
The risk of damages "will not be eliminated if the records are
returned," the lawsuit states. "Identity theft can and often is
accomplished by recording information and returning or disposing
of the original material source."
PHONE COS: Deceptive Marketing Suit Settlement Gets Approval
------------------------------------------------------------
A settlement has been approved in a long-running class action
suit against a group of long distance phone companies that had
engaged in deceptive marketing practices in Washington.
The lawsuit was filed in 2005 in Seattle on behalf of Washington
customers of NOS Communications, Affinity Network, and NOSVA
Limited Partnership, collectively known as "NOS."
The plaintiff in the case, Baxter Air, Inc., of Woodinville,
claimed it switched to NOS for long distance service in 2003
because it was promised lower rates than offered by competing
carriers. But unlike most carriers, NOS does not bill customers
in "cents per minute" but rather uses a complicated system it
calls "total call units" or "TCUs." NOS did not disclose how
this system worked until after customers signed a contract. The
system results in more than double the cost per call than an
equivalent per-minute rate. A court had determined that NOS's
marketing practices were deceptive and violated Washington's
Consumer Protection Act.
A trial to determine class damages had been set for April when a
proposed settlement was reached. The court granted final
approval of the settlement June 25, 2008.
Class counsel, Daniel Johnson of Breskin Johnson & Townsend,
PLLC, said the settlement would provide hundreds or even
thousands of dollars in refunds to about 1,000 class members
throughout the state, depending on how long they had service
with NOS and how much they paid for it.
It also guarantees that NOS will not market long distance
service in Washington using its unique "TCU" pricing system
again without disclosing in advance exactly how it compares to
normal per-minute pricing.
For more information, contact:
Breskin Johnson & Townsend, PLLC
999 Third Avenue, Suite 4000
Seattle, WA 98104-4009
Web site: http://www.bjtlegal.com/
RITE AID: Faces Pennsylvania Suit Over Sale of Expired Medicine
---------------------------------------------------------------
Rite Aid Corp. is facing a consumer class-action complaint filed
in the U.S. District Court for the Eastern District of
Pennsylvania accusing it of selling expired medicines,
CourtHouse News Service reports.
This action arises from the defendant's sale of potentially
dangerous expired products, including milk, eggs, over the
counter medicines, and baby formula. Many of the expired
products at issue were sold over a year past their expiration
dates.
The complaint states that investigators for the New York
Attorney General found an "egregious pattern at Rite Aid of
selling expired products," including eggs, milk and baby
formula.
The suit says state investigators bought more than 600 expired
products, including eggs, milk and baby products at 112 Rite Aid
stores in 41 counties.
Named plaintiff Terri Brennan says she bought expired over the
counter medicine at a Rite Aid.
The plaintiff seeks to maintain the action as a class action
under Rule 23(b)(2) of the Federal Rules of Civil Procedure on
behalf of all persons in the United States who purchased expired
products from Rite Aid and who were damaged thereby.
The plaintiff wants the court to rule on:
a. whether the defendant breached any implied warranties in
selling expired products;
b. whether the defendant breached implied contracts in
selling expired products;
c. whether the class is entitled to injunctive relief
and money damages.
The plaintiff requests:
-- that the Court certify this action as a class action
pursuant to Federal Rule of Civil Procedure 23(a),
(b)(2), and, alternatively, (b)(3) and appoint Plaintiff
and her counsel to represent the Class;
-- that the Court enter judgment in favor of Plaintiff and
the class, and against the defendant under the legal
theories alleged;
-- that the Court issue an injunction ordering the
defendant to stop selling expired products;
-- that the Court issue an injunction ordering the
defendant to offer class members a right to return the
offending products for a full refund;
-- that the Court award damages resulting from the
defendant's conduct, if any, to the plaintiff and the
class under the legal theories alleged herein;
-- that the Court award attorneys' fees, expenses, and
costs of this suit;
-- that the Court award the plaintiff and the class pre-
judgment and post judgment interest at the maximum rate
allowable by law; and
-- that the Court award such other and further relief as
it may deem just and appropriate.
The suit is "Terri A. Berman, et al. v. Rite Aid Corp.," filed
in the U.S. District Court for the Eastern District of
Pennsylvania.
Representing the plaintiff are:
Sherrie R. Savett, Esq.
Michael T. Fantini, Esq.
Doug Risen, Esq.
Shoshana T. Savett, Esq.
Berger & Montague, PC
1622 Locust Street
Philadelphia, PA 19103
Phone: 215-875-3000
Fax: 215-875-4636
SAKS INC: Still Faces Alabama Suit Over Merchandise Return Fees
---------------------------------------------------------------
Saks, Inc., continues to face a purported class action suit
before the U.S. District Court for the Northern District of
Alabama over breach of contract allegations.
Adamson Apparel, Inc., filed the suit on Dec. 8, 2005. The
plaintiff alleges that the company improperly assessed
chargebacks, timely payment discounts, and deductions for
merchandise returns against members of the plaintiff-class.
The lawsuit seeks compensatory and incidental damages and
restitution.
The Bon-Ton Stores, Inc., reported no further development in the
matter in its June 11, 2008 Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended May 3,
2008.
The suit is "Adamson Apparel, Inc. v. Saks Inc., Case No. 2:05
cv-02514-SLB," filed in the U.S. District Court for the Northern
District of Alabama, Judge Sharon Lovelace Blackburn, presiding.
Representing the plaintiffs are:
Richard T. Dorman, Esq. (rtd@cbycb.com)
Cunningham Bounds Yance Crowder & Brown
P.O. Box 66705
Mobile, AL 36660
Phone: 1-251-471-6191
Rachel J. Geman, Esq. (rgeman@lchb.com)
Lieff Cabraser Heimann & Bernstein, LLP
780 Third Avenue, 48th Floor
New York, NY 10017
Phone: 212-355-9500
Fax: 212-355-9592
- and -
David J. Guin, Esq. (davidg@dglawfirm.com)
Tammy McClendon Stokes, Esq. (tstokes@dglawfirm.com)
Donaldson & Guin, LLC
The Financial Ctr., 505 20th Street, North Suite 1000
Birmingham, AL 35203
Phone: 205-503-4505
Fax: 205-226-2357
Representing the defendant is:
Andrew J. Sinor, Jr., Esq. (dsinor@handarendall.com)
Hand Arendall, LLC
1200 Park Place Tower, 2001 Park Place North
Birmingham, AL 35203
Phone: 205-324-4400
Fax: 205-397-1310
SECURITY PLAN: Faces Policyholder's Suit Over Medical Expenses
--------------------------------------------------------------
Security Plan Fire Insurance Co., a wholly owned subsidiary of
Citizens, Inc., is facing a purported class action lawsuit
entitled, "Lilac Todd vs. Security Plan Life Insurance Company,"
according to Citizens, Inc.'s May 2008 Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2008.
The suit was filed on Nov. 8, 2005, on behalf of Lilac Todd,
alleging that SPLIC failed to pay Ms. Todd's claim for medical
expenses arising out of the amputation of one of her limbs.
On Dec. 20, 2007, a Supplemental and Amended Petition for
Damages was filed pursuant to which the plaintiff has asserted
class action allegations.
The purported class is defined as all Louisiana insureds of
SPLIC whose policies contained an incontestability provision
identical or similar to Ms. Todd's policy, and whose claims were
denied within 10 years of the petition filing on the basis of
illnesses, injuries or diseases diagnosed or which occurred at
any time preceding the incontestability.
SPLIC has responded by filing Exceptions of Vagueness and of
Improper Use of the Class Action Procedure, as well as an Answer
to the Supplemental and Amended Petition for Damages. SPLIC has
also recently filed a Motion for Partial Summary Judgment. The
Exceptions and Partial Motion for Summary Judgment have not yet
been set for hearing.
The Lilac Todd matter is in the early stages of litigation
relative to the class allegations and minimal discovery has
occurred.
The plaintiffs have not established how many, if any,
individuals are within the class definition proposed by
plaintiff.
Citizens, Inc. -- http://www.citizensinc.com/-- is an insurance
holding company serving the life insurance needs of individuals
in the U.S. and in more than 35 countries. The Company's core
operations include issuing and servicing, which intern include
ordinary whole life insurance policies predominantly to high net
worth, high income foreign residents, principally in Latin
America and the Pacific Rim, through approximately 2,600
independent marketing consultants; ordinary whole life insurance
policies to middle income households in the Midwest and the
southern U.S. through approximately 600 independent marketing
consultants; and final expense and limited liability property
policies to middle to lower income households in Louisiana
through approximately 300 employee agents in its home service
distribution channel. The Company's business consists of three
primary operating business segments: Life Insurance, Home
Service Insurance, and Other Non-insurance Enterprises.
SECURITY PLAN: Faces La. Litigation Over Insurance Coverage
------------------------------------------------------------
Security Plan Fire Insurance Co., a wholly-owned subsidiary of
Citizens, Inc., faces a purported class action over insurance
coverage that the company provided, according to Citizens,
Inc.'s May 12, 2008 Form 10-Q Filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2008.
The suit was filed with the Civil District Court for the Parish
of Orleans on behalf of Karen Cheneau in August 2006. It stems
from damages Ms. Cheneau sustained during Hurricane Katrina.
In November 2007, plaintiff filed a Motion for Leave to File
First Amended Petition to Assert Class Allegations Against
SPFIC.
The purported class consists of Louisiana citizens who purchased
homeowner's insurance coverage and/or contents insurance
coverage from SPFIC, whose homes and/or property covered by said
policies were damaged as a result of Hurricane Katrina and who
timely submitted claims to SPFIC for their losses, and who
either received no recovery or received less than the proper
value of their valued policies as a result of their claims.
SPFIC has responded to the Amended Petition by filing Exceptions
of No Cause of Action, No Right of Action, Vagueness,
Prescription and Failure to Meet Class Action Requirements.
Citizens, Inc. -- http://www.citizensinc.com-- is an insurance
holding company serving the life insurance needs of individuals
in the U.S. and in more than 35 countries. The Company's core
operations include issuing and servicing, which intern include
ordinary whole life insurance policies predominantly to high net
worth, high income foreign residents, principally in Latin
America and the Pacific Rim, through approximately 2,600
independent marketing consultants; ordinary whole life insurance
policies to middle income households in the Midwest and the
southern U.S. through approximately 600 independent marketing
consultants; and final expense and limited liability property
policies to middle to lower income households in Louisiana
through approximately 300 employee agents in its home service
distribution channel. The Company's business consists of three
primary operating business segments: Life Insurance, Home
Service Insurance, and Other Non-insurance Enterprises.
TYCO INT'L: New Hampshire Securities Fraud Suits Emerge Again
-------------------------------------------------------------
Five years after Tyco International left New Hampshire, class
action lawsuits associated with securities fraud that sent the
company's chief executive officer and chief financial officer to
prison returned to the state earlier this month, New Hampshire
Business Review reports.
The report relates that by June 17, at least four class action
lawsuits were filed against Tyco in the U.S. District Court in
Concord, representing some 50 mutual funds and the state of
Michigan. N.H. Business Review says more may be on their way.
According to the report, the lawsuits will be heard by Judge
Paul J. Barbadoro, who tried the first wave of class action
cases that led to a $3-billion settlement in May 2007.
N.H. Business Review recounts that, according to the court's
order in December 2007 granting final approval to that
settlement, some 288 class members -- who owned about 4% of the
company's shares -- opted out of the deal, keeping their right
to launch their own lawsuits.
Thus far, the plaintiffs in the new cases involve these major
fund families: Merrill Lynch, Federated, American Nuveen and
BlackRock. N.H. Business Review notes that several attorneys
representing the funds said they believe they could get a better
deal for their clients than that agreed upon in the previous
settlement.
The cases were transferred to New Hampshire to work out pre-
trial motions, but the actual trials might take place back in
their own state, the report explains. So far, three of the
cases came from New Jersey, Tyco's current U.S. headquarters,
while the filing involving the state of Michigan came from
there. However, given Judge Barbadaro's knowledge of the case,
there also is a chance some, or all, of the cases could be
consolidated and tried in New Hampshire.
N.H. Business Review recalls that Tyco was once the most
profitable public company in New Hampshire, and its former CEO,
L. Dennis Kozlowski, the state's highest paid executive. Yet,
all that came to a halt when Manhattan's district attorney filed
criminal charges against Mr. Kozlowski and former CFO Mark
Swartz in New York City, charging that they looted their own
company. Their trial featured descriptions of lavish parties
and furnishings for a Manhattan apartment. Mr. Kozlowski and
Mr. Swartz were eventually convicted of grand larceny,
falsification of business records and conspiracy and are serving
up to 25 years in New York state prison.
Under pressure from the New Hampshire Bureau of Securities
Regulation, the Tyco board of directors paid New Hampshire
$5 million, money that has since been used to start a corporate
responsibility and investor education program. The company then
settled with the Securities and Exchange Commission for 10 times
that amount, N.H. Business Review further relates.
Institutional investors, led by pension funds, started the first
class action litigation against the company, Mr. Kozlowski and
other top executives in 2003. The suits were consolidated in
June 2006, and settled for about $2.975 billion nearly a year
later. A few months later, PricewaterhouseCoopers agreed to pay
investors $225 million for failing to blow the whistle on their
clients in their audits.
N.H. Business Review writes that given the large settlements in
the case, many thought the matter was finally closed. However,
the class action settlement gave individual investors the right
to opt out, and quietly those investors -- primarily mutual
funds -- began filing their own lawsuits at the beginning of
this year. The cases then went before a panel of judges who
decide whether it makes sense, at least when it comes to
pretrial motions, to consolidate them. On June 9, 2008, that
panel assigned them to New Hampshire. The New Jersey cases were
transferred on June 12 and the Michigan case was transferred
June 16.
The new cases are substantially similar to the old case,
according to the report. The 363-page complaint filed by a
dozen Federated funds for instance, charges that Tyco executives
"conceived, controlled, and concealed a massive criminal
enterprise that will forever link Tyco with the most infamous of
corporate scandals ever to rock the global securities markets."
The suit goes on to say, "The Tyco fraud, masterminded by the
Individual Defendants but permeating the entire Company, fused
bald theft of corporate assets with fraudulent accounting
entries designed to conceal and perpetuate the Individual
Defendants' unparalleled looting of shareholders' money."
The company then used "accounting gimmickry" to cover up the
theft, inflating the company's value, then cashing in on their
stock. When it all came out in the wash, Tyco's stock dropped
from $58.90 at the end of 2001 to $8.25 in June 12, wiping out
some $90 billion in market capitalization.
Tyco left the state in 2003, is under entirely new management
and has watched its stock rebound to $135 a share at the end of
June 2007, about a month after the settlement and before it
split up into three companies -- Tyco, Tyco Electronics and
Covidien.
WR GRACE: Court Yet to Rule on Relief Motions in ZAI Claims
-----------------------------------------------------------
The court overseeing the bankruptcy proceedings of WR Grace &
Co. has yet to rule on motions for various forms of relief
regarding claims pertaining to the company's attic insulation
product Zonolite Attic Insulation.
Approximately 4,300 property damage claims were filed against WR
Grace in addition to 380 asbestos property damage cases filed
against it prior to the March 31, 2003 claims bar date
established in the company's bankruptcy proceedings (Class
Action Reporter, Jan. 8, 2007).
The bar date did not apply to claims against ZAI, a former Grace
attic insulation product. As of Oct. 31, 2006, following the
reclassification, withdrawal or expungement of claims,
approximately 640 property damage claims remain outstanding.
Eight of the ZAI-related complaints were filed as purported
class actions in 2000 and 2001. In addition, 10 lawsuits were
filed as purported class actions in 2004 and 2005 with respect
to persons and homes in Canada. These cases seek damages and
equitable relief, including the removal, replacement and
disposal of all such insulation.
The plaintiffs assert that the product is in millions of homes
and that the cost of removal could be several thousand dollars
per home. As a result of the filing, the eight U.S. cases have
been transferred to the Bankruptcy Court.
Based on Grace's investigation of the claims described in these
lawsuits, and testing and analysis of this product by Grace and
others, Grace believes that the product was and continues to be
safe for its intended purpose and poses little or no threat to
human health.
The plaintiffs in the ZAI lawsuits dispute Grace's position on
the safety of ZAI. In July 2002, the Bankruptcy Court approved
special counsel to represent, at Grace's expense, the ZAI
claimants in a proceeding to determine certain threshold
scientific issues regarding ZAI.
On Oct. 18, 2004, the Bankruptcy Court held a hearing on motions
filed by the parties to address a number of important legal and
factual issues regarding the ZAI claims.
On Dec. 14, 2006, the Bankruptcy Court issued an opinion and
order holding that, although ZAI is contaminated with asbestos
and can release asbestos fibers when disturbed, there is no
unreasonable risk of harm from ZAI.
The ZAI claimants sought an interlocutory appeal of the opinion
and order with the District Court in Delaware but that request
was denied.
The ZAI claimants have indicated they still intend to appeal
such opinion and order when it becomes a final order.
The Debtors have asked the Bankruptcy Court to establish a bar
date for ZAI claims and approve a related notice program that
would require persons with a ZAI claim to submit individual
proofs of claim.
At the same time, the ZAI Claimants have asked the Bankruptcy
Court for various forms of relief:
-- to take such actions as would finalize the Dec. 14,
2006 order and permit an appeal to be taken;
-- to allow the ZAI claims to return to the state court
tort system;
-- to appoint an expert to estimate the number of homes
containing ZAI; and
-- to certify a class claim on behalf of Washington state
residents.
These motions were scheduled to be argued at a hearing in
June 2008. The company has not yet reported further
developments in its May 2008 Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended
March 31, 2008.
W.R. Grace & Co. -- http://www.grace.com/-- supplies catalysts
and silica products, especially construction chemicals and
building materials, and container products globally.
* Americas Watchdog Expands Services for Plaintiffs
---------------------------------------------------
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something happens with respect to a FDA recall, and they
don't jump on it instantly. The case goes to someone
else, or a great case never gets filed. Trying to get
involved three or four weeks after an FDA recall is too
late".
* National or Regional Home builders: Aside from selling
mortgage backed securities that were inflated by 20% or
more -- exposing the shareholders to a down graded stock,
US home builders have defrauded millions of US consumers
with over priced internal mortgage products, phony title
insurance policies, appraisal fraud and more. This
mentions nothing of millions of possibly defective homes
built by undocumented workers. Plaintiffs law firms
wishing to know about US home builders are welcome to
contact Americas Watchdog anytime at 866-714-6466.
Americas Watchdog's National Mortgage Complaint Center is
one of the most quoted sources in the US on predatory
mortgage lending. The group also has a specific
expertise in defective construction products.
* Law firms that might have an interest in hospital or
nursing home issues are welcome to call Americas Watchdog
anytime. The group has years of experience investigating
hospitals or medical facilities for negligence, abuse,
and fraud. According to the group, "if it happened once
typically it happened more than once.
* Law firms that might have an interest in insurance
companies involved in red lining consumers, or insurance
bad faith issues should contact Americas Watchdog.
Americas Watchdog's President formerly lived in New
Orleans before, during and after Hurricane Katrina.
According to the group, "a consumer getting 50 cents on
the dollar for a major loss in an insurance claim is not
acceptable. We are passionate about exposing insurance
companies for what they are & what they do to average US
consumers".
Americas Watchdog is one of the most quoted consumer sources in
the US on banks or financial institutions, securities, or
financial products, national or regional home builders, Wall
Street, pharmaceutical companies, US drug recalls, hospitals or
nursing homes.
The group has been featured in Money Magazine, the Wall Street
Journal, Newsweek Magazine, Good Housekeeping Magazine, The New
York Times, The Daily Telegraph of London and numerous other US
or international publications. If Americas Watchdog can assist
a plaintiffs law firm in any of the mentioned areas, partners
are welcome to call the group anytime at 866-714-6466.
Americas Watchdog on the net: http://AmericasWatchdog.com/
Americas Watchdog is all about consumer protection and corporate
responsibility.
* Retroactive Liability Protection Changes Considered by Senate
---------------------------------------------------------------
The Senate could consider amendments that would strip or weaken
the retroactive liability protection provided by the bipartisan
FISA modernization bill that passed the House by an overwhelming
vote of 293 to 129.
Failure to pass the liability protection contained in the House
bill for companies that assisted intelligence professionals
after the 9/11 attacks will undermine partnership with the
private sector. Such cooperation is essential to protecting the
country from another terrorist attack.
The Senate should pass the bipartisan House legislation so
intelligence professionals can better protect Americans from
foreign threats.
Without this protection, private sector companies will become
less willing to cooperate with the intelligence community's
efforts to protect the country.
Failure to provide retroactive liability protection would
undermine the private sector's willingness to cooperate with the
Intelligence Community -- cooperation that is essential to
protecting America.
Companies may also be less willing to assist the government in
the future if they face a threat of private lawsuits each time
they are alleged to have provided assistance.
* Providing retroactive liability protection is critical to
providing intelligence officials the tools they need
to carry out their mission of protecting the homeland.
The Attorney General and Director of National
Intelligence have reported that "even prior to the
expiration of the Protect America Act, we experienced
significant difficulties in working with the private
sector because of the continued failure to provide
liability protection for such companies."
* The Senate should not pass any amendment that would
unnecessarily complicate and prolong lawsuits against
companies. A major purpose of the retroactive liability
protections in the bipartisan House bill is to provide
for the expeditious dismissal of lawsuits once the
Attorney General certifies, and the district court
confirms, that companies provided assistance in response
to a request from the Government. The Senate
Intelligence Committee, in a bipartisan report, concluded
that any companies that provided assistance acted in good
faith and that permitting the lawsuits to continue could
deter the private sector from providing lawful assistance
to the intelligence community in the future.
It is unfair and unjust to threaten companies with financial
ruin because they are believed to have helped their country.
Allowing these lawsuits to continue would be unfair because any
companies that assisted us after 9/11 were assured by the
government that their cooperation was legal and necessary. More
than 40 such lawsuits have been filed, seeking hundreds of
billions of dollars in damages from these companies. These
lawsuits are good for class action trial lawyers, but they are
terrible for the United States.
* Companies that assisted with the clear intention of
helping to protect their fellow citizens should be
thanked for their patriotic service, not subjected to
multibillion-dollar lawsuits that will make them less
willing to help in the future.
Allowing these lawsuits to proceed risks disclosure of highly
classified information regarding the methods used by the
intelligence community to protect the country from terrorist
attack.
This litigation could lead to the disclosure of state secrets
and possibly the public release of highly classified information
that enemies could use against us. It makes no sense to give
the enemy critical knowledge about what the United States is
doing to protect the American people. But this is what could
happen if the Senate allows massive and costly class-action
lawsuits to proceed, which would increase the risk of revealing
the methods used by the Intelligence Community to monitor
foreign terrorist communications.
New Securities Fraud Cases
FIRST AMERICAN: Federman & Sherwood Files N.Y. Securities Suit
--------------------------------------------------------------
On June 23, 2008, a class action lawsuit was filed in the United
States District Court for the Southern District of New York
against First American Corporation.
The complaint alleges violations of federal securities laws,
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b-5, including allegations of issuing a series of
material misrepresentations to the market which had the effect
of artificially inflating the market price.
The class period is from April 26, 2006, through November 6,
2007.
Plaintiff seeks to recover damages on behalf of the Class.
Interested parties may move the court no later than August 25,
2008, for lead plaintiff appointment.
For more information, contact:
William B. Federman, Esq. (wfederman@aol.com)
Federman & Sherwood
10205 North Pennsylvania Avenue
Oklahoma City, OK 73120
Web site: http://www.federmanlaw.com
SONOCO PRODUCTS: Coughlin Stoia Files S.C. Securities Fraud Suit
----------------------------------------------------------------
Coughlin Stoia Geller Rudman & Robbins LLP disclosed that a
class action has been commenced on behalf of an institutional
investor in the United States District Court for the District of
South Carolina on behalf of purchasers of Sonoco Products Co.
common stock during the period between February 7, 2007, and
September 18, 2007.
The complaint charges Sonoco Products and certain of its
officers and directors with violations of the Securities
Exchange Act of 1934.
Sonoco Products manufactures industrial and consumer packaging
products, and packaging services primarily in the United States,
Europe, and Canada.
The complaint alleges that, during the Class Period, defendants
issued a series of materially false and misleading statements
concerning the Company's financial performance and prospects.
Specifically, the complaint alleges that these statements were
materially false and misleading because defendants failed to
disclose and misrepresented:
(i) that the Company was losing market share to its
competitors;
(ii) that the Company was having operational difficulties in
implementing its next generation of products;
(iii) that the Company was experiencing weaker sales in its
Engineered Carriers and Paper and Consumer Packaging
segments, especially in North America;
(iv) that the Company was distracted by the loss of a bid on
a large contract, which resulted in decreased sales and
price concessions on current contracts;
(v) that the Company was having a difficult time in moving
its old inventory; and
(vi) that as a result of the forgoing, the Company had no
reasonable basis for its 2007 earnings guidance.
On July 20, 2007, the Company announced its financial results
for the second quarter of 2007, the period ended July 1, 2007.
For the quarter, the Company reported earnings of $0.41 per
diluted share, below analysts' expectations. In response to
this announcement, shares of the Company's common stock fell
$6.30 per share, or over 14%, to close at $38.00 per share, on
heavy trading volume.
On September 18, 2007, the Company announced that it was
reducing its third quarter 2007 base earnings estimate to a
range of $0.55 to $0.58 per diluted share. Upon this news,
shares of the Company's stock fell $2.42 per share, or over 7%,
to close at $30.78 per share, on heavy trading volume.
Plaintiff seeks to recover damages on behalf of all purchasers
of Sonoco common stock during the Class Period.
For more information, contact:
Samuel H. Rudman, Esq.
David A. Rosenfeld, Esq.
Coughlin Stoia Geller Rudman & Robbins LLP
655 West Broadway, Suite 1900
San Diego, CA 92101
Phone: 800-449-4900
e-mail: djr@csgrr.com
*********
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
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