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/raid1/www/Hosts/bankrupt/CAR_Public/080826.mbx C L A S S A C T I O N R E P O R T E R Tuesday, August 26, 2008, Vol. 10, No. 169 Headlines ADOLOR CORP: Awaits Dismissal of Pa. Securities Fraud Lawsuit AMERICAN TOWER: Plaintiff Appeal Approval of $14-Mln. Suit Deal CAI INC: Settles 2006 Facility Explosion Suit for $6.6 Million CAREER EDUCATION: Court Mulls Final OK for "Sanders" Settlement CAREER EDUCATION: Still Faces CCA Students' Suit in California CAREER EDUCATION: Wants Medical Assistant Program Suit Dismissed CAREER EDUCATION: Amended Complaint Filed in "Gozzi" Lawsuit CAREER EDUCATION: Responds to Amended Complaint in "Diallo" Case CAREER EDUCATION: Faces Calif. Lawsuit Over Admissions Process CAREER EDUCATION: Seeks Dismissal of "Blake" Lawsuit in Missouri CAREER EDUCATION: Reaches Ill. FLSA Violations Suit Settlement CAREER EDUCATION: Faces Suit in Calif. Over Rest & Meal Periods EXTENDICARE HOMES: Extendicare REIT Acknowledges Wash. Lawsuit FCSTONE GROUP: Lead Plaintiff Application Deadline is Sept. 15 GENERAL NUTRITION: Alabama Suit Claims Formadrol is Snake Oil GOODYEAR: USW Hails Approval of Retirees' $1B Health Care Fund J2 GLOBAL: Calif. Court Orders Stay on Internet Facsimile Suit MRV COMMS: Lead Plaintiff Application Deadline Set For Sept. 8 NUTRISYSTEM INC: Seeks Dismissal of Consolidated Securities Suit NUTRISYSTEM INC: Pa. Court Dismisses Certain Claims in "Parker" QWEST COMMS: Continues to Face Multiple Rights-of-Way Lawsuits QWEST COMMS: Faces Suit in Colorado Over Reduction of Benefits RAIT FINANCIAL: Awaits Court's Dismissal of Pa. Securities Suit REPUBLIC SERVICES: Shareholders Fight $2.8 Billion Trash Deal SAN DIEGO CITY: Police Officers File Suit Over Unpaid Overtime SMITHKLINE BEECHAM: Faces Pa. Lawsuit Over Allergy Drug Flonase SPRINT NEXTEL: Discovery Ongoing in Kansas Securities Fraud Suit VATERROTT EDUCATION: Mo. Lawsuit Alleges Defrauding of Students WENDY'S INT'L: Parties in Triarc Merger Suits Seek Consolidation WENDY'S INT'L: N.Y. Lawsuit Over Triarc Merger Agreement Stayed ZURN INDUSTRIES: Sued Over Defective Brass Fittings Warranty New Securities Fraud Cases CHINA SHENGHOU: Rosen Firm Files Securities Fraud Suit in N.Y. CIT GROUP: Schiffrin Barroway Files Securities Suit in New York COMPUCREDIT CORP: Pomerantz Files Securities Fraud Suit in Ga. INYX INC: Brualdi Files Securities Fraud Lawsuit in New York PERINI CORP: Coughlin Stoia Files Securities Fraud Suit in Mass. ********* ADOLOR CORP: Awaits Dismissal of Pa. Securities Fraud Lawsuit ------------------------------------------------------------- The U.S. District Court for the Eastern District of Pennsylvania has yet to rule on a motion by Adolor Corp. to dismiss a consolidated securities class action lawsuit filed against it, its director and certain officers. The lawsuit was filed on April 21, 2004, with the U.S. District Court for the Eastern District of Pennsylvania against the company, one of its directors and certain of its officers, seeking unspecified damages on behalf of a putative class of persons who purchased common stock between Sept. 23, 2003, and Jan. 14, 2004. It alleges violations of Section 10(b) and section 20(a) of the U.S. Securities Exchange Act of 1934, in connection with the announcement of the results of certain studies in the company's Phase III clinical trials for Entereg(R), which allegedly had the effect of artificially inflating the price of the company's common stock. The suit has been consolidated with three subsequent actions asserting similar claims under the caption, "In re Adolor Corporation Securities Litigation, No. 2:04-cv-01728." On Dec. 29, 2004, the district court issued an order appointing the Greater Pennsylvania Carpenters' Pension Fund as lead plaintiff. The appointed lead plaintiff filed a consolidated amended complaint on Feb. 28, 2005. The complaint purported to extend the class period, so as to bring claims on behalf of a putative class of Adolor shareholders who purchased stock between Sept. 23, 2003, and Dec. 22, 2004. The amended suit also adds as defendants the board of directors, asserting claims against them and the other defendants for violation of Section 11 and Section 15 of the U.S. Securities Act of 1933 in connection with the company's public offering of stock in November 2003. The company and its management and director defendants moved to dismiss the complaint on April 29, 2005. The plaintiffs responded to this motion on June 28, 2005, and the defendants' reply was filed on Aug. 12, 2005. The company reported no further development in the matter in its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "In re Adolor Corp. Securities Litigation, No. 2:04- cv-01728," filed in U.S. District Court for the Eastern District of Pennsylvania. Representing the plaintiffs are: Ramzi Abadou, Esq. (ramzia@lcsr.com) Lerach Coughlin Stoia & Robbins LLP 401 B St., Ste. 1700 San Diego CA, 92101 Phone: 619-231-1058 - and - Marc S. Henzel, Esq. (mhenzel182@aol.com) Law Offices of Marc S. Henzel 273 Montgomery Ave., Suite 202 Bala Cynwyd PA 19004 Phone: 610-660-8000 Representing the defendants are: Michael S. Doluisio, Esq. (michael.doluisio@dechert.com) Jeffrey G. Weil, Esq. Dechert, Price & Rhoads 1717 Arch Street, 4000 Bell Atlantic Tower Philadelphia, PA 19103-2793 Phone: 215-994-2749 Fax: 215-994-2222 - and - Laurie B. Smilan, Esq. (laurie.smilan@lw.com) Latham & Watkins LLP Two Freedom Square 11955 Freedom Drive, Suite 500 Reston, VA 20190-5651 Phone: 1-703-456-5220 Fax: 1-703-456-1001 AMERICAN TOWER: Plaintiff Appeal Approval of $14-Mln. Suit Deal --------------------------------------------------------------- A plaintiff in the matter captioned "In re American Tower Corporation Securities Litigation, No. 06 CV 10933 (MLW) (D. Mass.)," has appealed an order entered by the U.S. District Court for the District of Massachusetts that granted final approval to the $14-million settlement reached in the case, according to defendant American Tower Corp.'s Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for quarter ended June 30, 2008. The suit was filed by John S. Greenebaum in 2006. Also named as plaintiff in the case is Steamship Trade Association- International Longshoremen's Association Pension Fund. The complaint names the company, James D. Taiclet Jr., and Bradley E. Singer as defendants. It alleges that the defendants violated federal securities laws in connection with public statements made relating to the company's stock option practices and related accounting. The suit asserts claims under Sections 10(b) and 20(a) of the U.S. Exchange Act and Rule 10b-5. It seeks monetary relief. In December 2006, the court appointed the Steamship Trade Association-International Longshoreman's Association Pension Fund as the lead plaintiff. On March 26, 2007, the plaintiffs filed an amended consolidated complaint, which includes additional current and former officers and directors of the company as defendants. In December 2007, the company announced that it had reached a settlement in principle regarding the securities class action. The settlement, which was preliminarily approved by the court in February 2008, provided for a payment by the company of $14 million and would lead to a dismissal of all claims against all defendants in the litigation. The company paid $250,000 of the settlement amount to an escrow account controlled by the plaintiffs during the quarter ended March 31, 2008. In April 2008, the company paid the remaining settlement amount of $13.8 million into escrow and received $12.5 million in insurance proceeds. In May 2008, the original plaintiff, Mr. Greenebaum, filed an objection to the settlement. Following a hearing in June 2008, the Court dismissed Mr. Greenebaum's objection and approved the settlement. In July 2008, Mr. Greenebaum filed an untimely request to opt out of the settlement class certified by the Court in its orders. Mr. Greenebaum's request was opposed by the company. Additionally, Mr. Greenebaum filed a notice of appeal of the Court's final order approving the settlement agreement. The members of the plaintiff class will not be entitled to draw the funds until Mr. Greenebaum's appeal is finally resolved. The suit is "In re American Tower Corporation Securities Litigation, No. 06 CV 10933 (MLW)," filed in the U.S. District Court for the District of Massachusetts, Judge Mark L. Wolf, presiding. Representing the plaintiff is: Jason B. Adkins, Esq. (jadkins@akzlaw.com) Adkins, Kelston and Zavez, P.C. 90 Canal Street, 5th Floor Boston, MA 02114 Phone: 617-367-1040 Fax: 617-742-8280 - and - David J. Goldsmith, Esq. Goodkind Labaton Rudoff & Sucharow LLP 100 Park Avenue New York, NY 10017-5563 Phone: 212-907-0700 Representing the company is: Michael T. Gass, Esq. (mgass@eapdlaw.com) Edwards Angell Palmer & Dodge LLP 111 Huntington Avenue Boston, MA 02199 Phone: 617-239-0100 Fax: 617-227-4420 CAI INC: Settles 2006 Facility Explosion Suit for $6.6 Million -------------------------------------------------------------- A settlement of $6.6 million has been proposed to resolve a class-action lawsuit against CAI, Inc., and Arnel Co., over an explosion at an ink-and-paint factory near Danversport that happened in 2006, Kathy McCabe writes for the Boston Globe. Boston Globe relates that CAI Inc., of Georgetown, and Danvers- based Arnel Co. -- which co-owned the factory that exploded into a fireball on Nov. 22, 2006 -- were named as defendants in the proposed class action filed by Rachelle Borrelli of Waltham, a boat owner whose craft was destroyed at Liberty Marina, which is next to the destroyed factory. She is seeking compensation for individuals, boat owners, homeowners, businesses, and others affected by the blast. Michael Germano, Esq., of Boston, filed the lawsuit on behalf Ms. Borrelli, who did not have enough insurance to cover her losses. He believes that there are many other property owners like his client. In Feb. 2007, Judge Richard Welch of the Newburyport Superior Court granted a motion filed by Arnel to transfer the case into a special Business Litigation session at Suffolk Superior Court (Class Action Reporter, Feb. 22, 2007). Subsequently, the parties entered into talks regarding a settlement of the case. Under the proposed settlement, the companies would pay $1.4 million to about 100 property owners and $5.2 million to insurance carriers, according to a settlement proposal filed in Lawrence Superior Court. The $6.6 million represents the entire amount of liability insurance carried by each company, according to the court filing. The settlement would "not be an admission of liability" by either company, court papers show. Insurance carriers have paid out in excess of $20 million to settle claims filed by homeowners, businesses, and boat owners. The report states that federal and state investigators concluded that the explosion was caused when chemical vapors that had built up inside the factory ignited from an unknown source. Jan Schlichtmann, Esq., a Beverly environmental lawyer who represented the plaintiffs, said "The settlement would be for the benefit of anyone who was impacted by the explosion." The settlement must also be approved by the court, he added. The settlement also would apply to 215 members of The Danversport Trust, which formed last year to negotiate an out- of-court settlement. According to the report, members of the trust will be meeting to vote on whether to accept the offer. A three-person panel would decide how much each individual receives in compensation, if the agreement is approved. "Everybody's circumstances are different," said Susan Tropeano, a resident who helped to organize the trust. "We really think this settlement is the best way to do it." W. Paul Needham, Esq., a lawyer for the companies, did not return Boston Globe's call seeking comment. CAI International, Inc., together with its subsidiaries, operates as an intermodal freight container leasing and management company. It leases, re-leases, and disposes containers and contract for the repair, repositioning, and storage of containers. The Company is based in San Francisco, Calif. with additional offices in Belgium, Hong Kong, Japan, Malaysia, Singapore, Taiwan, and the United Kingdom. CAREER EDUCATION: Court Mulls Final OK for "Sanders" Settlement --------------------------------------------------------------- The U.S. District Court for the District of Maryland has yet to grant final approval to the proposed settlement in the matter captioned "Sanders et al. v. Career Education Corporation et al., Case No. 8:2006-cv-01031." On March 15, 2006, 26 current and former students of the Landover, Maryland campus of Sanford-Brown Institute, one of Career Education's schools, filed a class-action complaint on behalf of themselves and all others similarly situated against Career Education and Ultrasound Technical Services, Inc., one of the company's subsidiaries. The suit, entitled "Laronda Sanders, et al. v. Ultrasound Technical Services, Inc. et al.," was filed in the Circuit Court for Prince George's County, Maryland. It alleges that the defendants made fraudulent misrepresentations and violated the Maryland consumer fraud act by misrepresenting or failing to disclose, among other things, details regarding instructors' experience or preparedness, availability of clinical externship assignments, and estimates for the dates upon which the plaintiffs would receive their certificates and be able to enter the work force. The plaintiffs further allege that the defendants failed to maintain accurate attendance records, and that the defendants negligently or deliberately dropped students without justification. The complaint also alleges that the defendants breached the enrollment contract with the plaintiffs by failing to provide the promised instruction, training, externships, and placement services. The plaintiffs seek actual damages, punitive damages, and costs. The defendants removed the action to the U.S. District Court for the District of Maryland and filed a motion to dismiss significant portions of the complaint. The plaintiffs requested to remand the action to state court. On Sept. 18, 2006, the court denied the plaintiffs' remand motion. The court, however, granted the defendants' motion to dismiss the common law and statutory fraud counts of the complaint, with leave to amend. On Oct. 17, 2006, the plaintiffs filed an amended complaint. The case was later consolidated with a separate action brought in the same court by another former student. On March 12, 2007, the plaintiffs filed a second amended complaint. On March 7, 2008, the court granted the plaintiffs leave to file a third amended complaint adding four additional former students as plaintiffs based on similar allegations. The parties subsequently agreed to resolve their dispute and entered into a deal. The parties are in the process of finalizing terms of a proposed settlement in the matter, which deal would only be effective upon approval of the court. The settlement remains subject to final approval by the court after notice to potential class members, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Sanders, et al. v. Career Education Corporation, et al., Case No. 8:2006-cv-01031," filed in the U.S. District Court for the District of Maryland, Judge Peter J. Messitte, presiding. Representing the plaintiffs are: George Wadie Hermina, Esq. Hermina Law Group 8327 Cherry Ln Laurel, MD 20707 Phone: 1-301-206-3166 Fax: 1-301-490-7913 e-mail: law@herminalaw.com - and - Allan W. Steinhorn, Esq. (allansteinhorn@gmail.com) Clark and Steinhorn PC 11720 Beltsville Dr Ste 1001 Calverton, MD 20705 Phone: 1-301-572-5000 Fax: 1-301-572-9500 Representing the defendants are: Karl Richard Barnickol, IV, Esq. (karl.barnickol@kattenlaw.com) Katten Muchin Rosenman LLP 525 W Monroe St. Chicago, IL 60661 Phone: 1-312-902-5271 Fax: 1-312-577-4421 - and - Brian Andrew Briz, Esq. (bbriz@homerbonner.com) Homer Bonner PA 1441 Brickell Ave., Ste. 1200 Miami, FL 33131 Phone: 1-305-350-5117 Fax: 1-305-982-0062 CAREER EDUCATION: Still Faces CCA Students' Suit in California -------------------------------------------------------------- Career Education Corp. continues to face two purported class- action suits in California that were filed by certain students of CEC's California Culinary Academy, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. Amador Litigation On Sept. 27, 2007, a complaint, entitled "Amador et al. v. California Culinary Academy and Career Education Corp.," was filed in the California Superior Court in San Francisco on behalf of 37 current and former students of the California Culinary Academy. The plaintiffs brought their complaint as a putative class suit and alleged four putative causes of action: 1. fraud; 2. constructive fraud; 3. violation of the California Unfair Competition Law; and 4. violation of the California Consumer Legal Remedies Act. They contend that CCA made a variety of misrepresentations to them, primarily oral, during the admissions process. The alleged misrepresentations relate generally to the school's reputation, the value of the education, the competitiveness of the admissions process, the students' employment prospects upon graduation from CCA and CCA's ability to arrange beneficial student loans. CCA filed a motion to compel arbitration of certain of the claims by certain of the purported class representatives, but the Court denied that request on Feb. 28, 2008. The plaintiffs filed a First Amended Complaint on or about May 5, 2008, that alleges the same claims. The defendants filed demurrers to and a motion to strike the claims and various allegations, but no hearing date has been set. Adams Litigation On April 3, 2008, the same counsel representing the plaintiffs in the Amador action filed another suit on behalf of Jennifer Adams and several other unnamed members of the Amador putative class. The Adams action also is styled as a class action, is based on the same allegations underlying the Amador action, and attempts to plead the same four causes of action as in the Amador action. Although the Adams complaint is virtually identical to the Amador complaint, it makes adjustments to the manner in which the plaintiffs' counsel pleads plaintiffs' claim under the California Consumer Legal Remedies Act in an effort to avoid certain defects that may lead to dismissal of the claim in the Amador action. The date by which CCA and CEC must respond to the complaint has not yet been set. The defendants intend to move to coordinate this case with the Amador action and also to file demurrers to the plaintiffs' claims on various grounds when the response date is established. Career Education Corp. -- http://www.careered.com/-- is an educational services company. The company's schools and universities prepare students for professional careers through the operation of more than 75 on-ground campuses located throughout the U.S., France, Canada, Italy and the U.K., and three online academic programs. During the year ended Dec. 31, 2007, the company had approximately 89,500 students. The schools and universities offer doctoral degree, master's degree, bachelor's degree, associate degree, and non-degree certificate and diploma programs in Culinary Arts, Visual Communication and Design Technologies, Health Education, Business Studies and Information Technology. The segments of the company include Academy, Colleges, Culinary Arts, Health Education, International and University. CAREER EDUCATION: Wants Medical Assistant Program Suit Dismissed ---------------------------------------------------------------- Sanford Brown College and Career Education Corp. are seeking the dismissal of a purported class-action complaint filed on Feb. 11, 2008, before the Madison County Circuit Court, alleging that they fraudulently induced the plaintiffs and the class to join a medical assistant program through a number of deceptive acts The suit alleges that the defendants defrauded the students by misrepresenting transferability of credits in their RN program and financial aid opportunities at Sanford's Collinsville campus (Class Action Reporter, Feb. 21, 2008). The named plaintiffs are: * Jenna Lilley, * Jessica Lilley, * Candace Lindsay, and * Ashley Cunningham. The plaintiffs claim that they were aware they needed to take prerequisite courses in order to attend an accredited institution and inquired with Sanford Brown to see if the medical assistant program would fulfill the prerequisite requirements for a nursing program. "None of the four putative class representatives had any interest in taking the medical assistant program to become a medical assistant," the complaint states. "They saw the medical assistant program as a stepping-stone to becoming a registered nurse." The admissions representatives at Sanford Brown allegedly claim that: -- the tuition to attend Sanford Brown and obtain a medical assistant certificate was fixed, however students were forced to pay twice for classes they failed; -- the instructors had real-world experience and were otherwise well-qualified, however the majority of the instructors were themselves graduates of Sanford Brown, with little or no real-world experience. -- the students would be provided with the most up-to-date training aids and equipment but much of the perishable equipment provided was past its expiration date; -- the students would be placed in an actual doctor's office, however Sanford Brown was unable to place students in externships, and the students that were placed were assigned as a secretary or receptionist, not a medical assistant; and -- that there was a high demand for medical assistants, however the field is well staffed and doctors do not hire students from Sanford Brown because they are not properly trained. According to the complaint, Sanford Brown violated the Illinois Consumer Fraud and Deceptive Business Practices Act by engaging in conduct that creates a likelihood of confusion or misunderstanding. The plaintiffs, who are area nursing students, assert that they suffered actual damages by Sanford Brown's deceptive practices by the payment of fraudulently obtained tuition, by the payment for textbooks which were of no use, being overcharged for equipment and medical aides, being forced to purchase items from the school and exhausting federal aide available to them making it impossible to pursue a legitimate degree. "Plaintiffs and class members would not have sustained the damages but for the defendants deceptive practices in fraudulently inducing them to enroll in the medical assistant program," the complaint further states. According to the complaint, all persons who attended Sanford Brown in Collinsville and enrolled in the medical assistant program are eligible to join the class. The plaintiffs and the class want the court to rule on: (a) whether defendants represented that tuition would be set at a fixed amount; (b) whether defendants gave plaintiffs and the class inaccurate and inflated data concerning wages graduates could reasonably expect to earn including signing bonuses they could reasonably expect to receive; (c) whether defendants claimed Sanford Brown credits were transferable to other colleges and universities within Illinois; (d) whether Sanford Brown instructors were well experienced and well-qualified in teaching at the college level; (e) whether defendants misrepresented that there were a limited number of seats available for Sanford Brown programs that were filling up quickly; (f) whether defendants misrepresented that plaintiffs and class members would be provided with the most up to date training aids and equipment upon which to learn; (g) whether defendants misrepresented that plaintiffs and class members would be placed in a safe, educational environment for clinical study that was in close proximity to their homes; (h) whether defendants misrepresented that plaintiffs and class members would receive large financial grants and loans and the program would cost nothing out of pocket; (i) whether defendants misrepresented that plaintiffs and class members needed to purchase scrubs and other equipment from the school; (j) whether defendants misrepresented that plaintiffs and class members needed to purchase certain new textbooks to master the information needed to pass the classes; (k) whether defendants misrepresented that plaintiffs and class members needed to purchase all new textbooks and other equipment from the Sanford Brown bookstore; (l) whether defendants misrepresented that there was a high demand for workers in the fields for which plaintiffs and class members would be educated; (m) whether defendants misrepresented that plaintiffs and class members would receive large federal loans with low payments and interest; (n) whether defendants misrepresented that plaintiffs and class members would obtain their degrees much quicker and earn more money post degree completion than they would at a community college; (o) whether defendants misrepresented that plaintiffs and class members could only finance their education at Sanford Brown through Sanford Brown's Financial Aid Office; (p) whether defendants misrepresented to plaintiffs and class members that class sizes would be small and not exceed 20 people; (q) whether defendants intended the public to be misled by its various misrepresentations; (r) whether defendants' conduct constituted breach of contract; (s) whether defendants' conduct constituted a breach of the implied covenant of good faith and fair dealing; (t) whether the defendants' conduct is in violation of the Illinois Consumer Fraud Act; and (u) whether the conduct of alleged results in damages to plaintiffs and class members and, if so, the proper measure of those damages. The plaintiffs and class are seeking judgment for: -- compensatory, consequential, and incidental damages; -- general damages, including emotional distress in amount to be proved at trial; -- disgorgement and restitution of all monies converted, taken or appropriated by Sanford Brown; and -- prejudgment interest, attorney fees and costs of the suit. The company filed a motion to dismiss the case, which request is currently pending, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Jenna Lilley, et al. v. Career Education Corp., et al., Case No. 08 L 113," filed in the Circuit Court of Madison County, Illinois. The plaintiffs are represented by: John Carey, Esq. (jcarey@careydanis.com) David Bauman, Esq. (dbauman@careydanis.com) Corey Sullivan, Esq. (csullivan@careydanis.com) Carey & Danis, L.L.C. 8235 Forsyth Blvd. Suite 1100 St. Louis, MO 63105 Toll Free: 800-721-2519 Phone: 314-725-7700 (voice) Fax: 314-721-0905 CAREER EDUCATION: Amended Complaint Filed in "Gozzi" Lawsuit ------------------------------------------------------------ A second amended complaint was filed in a purported class-action suit in Oregon entitled "Gozzi, et al. v. Western Culinary Institute, Ltd. and Career Education Corporation." On March 5, 2008, Shannon Gozzi and Megan Koehnen filed the complaint in Portland, Oregon, in the Circuit Court of the State of Oregon in and for Multnomah County. The plaintiffs filed the complaint individually and as a putative class action and alleged two claims for equitable relief: violation of Oregon's Unlawful Trade Practices Act and unjust enrichment. They filed an amended complaint on April 10, 2008, adding two claims for money damages: fraud and breach of contract. The suit alleges that Western Culinary Institute made a variety of misrepresentations to them, relating generally to WCI's placement statistics, students' employment prospects upon graduation from WCI, the value and quality of an education at WCI, and the amount of tuition students could expect to pay as compared to salaries they may earn after graduation. On May 21, 2008, plaintiffs filed a second amended complaint in which they simply changed the statement "Claims Subject to Mandatory Arbitration" on the caption to "Claims Not Subject to Mandatory Arbitration" (emphasis added). WCI and CEC filed an answer to plaintiff's second amended complaint on June 13, 2008, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The defendants intend to file a motion to dismiss the lawsuit at the appropriate time, the company added. Career Education Corp. -- http://www.careered.com/-- is an educational services company. The company's schools and universities prepare students for professional careers through the operation of more than 75 on-ground campuses located throughout the U.S., France, Canada, Italy and the U.K., and three online academic programs. During the year ended Dec. 31, 2007, the company had approximately 89,500 students. The schools and universities offer doctoral degree, master's degree, bachelor's degree, associate degree, and non-degree certificate and diploma programs in Culinary Arts, Visual Communication and Design Technologies, Health Education, Business Studies and Information Technology. The segments of the company include Academy, Colleges, Culinary Arts, Health Education, International and University. CAREER EDUCATION: Responds to Amended Complaint in "Diallo" Case ---------------------------------------------------------------- Career Education Corp. and American InterContinental University, Inc., have filed their answers to an amended complaint filed in a purported class-action suit over AIU's admissions process. On March 19, 2008, a complaint, entitled "Diallo v. American Intercontinental University, Inc., and Career Education Corporation," was filed in the Superior Court of the State of Georgia of Fulton County, on behalf of Tajuansar Diallo. The plaintiff filed the complaint individually and as a putative class action and purports to allege causes of action for fraud, constructive fraud, negligent misrepresentation, and violations of the Georgia Deceptive and Unfair Trade Practices Act. The suit contends that AIU made a variety of oral and written misrepresentations to her during the admissions process. It alleged misrepresentations relate generally to the school's reputation, the value of the education, the competitiveness of the admissions process, the students' employment prospects upon graduation from AIU and AIU's ability to arrange beneficial student loans. On May 16, 2008, the plaintiffs filed a first amended complaint in which they added several named plaintiffs and expanded some of the factual allegations underlying their claims. On May 31, 2008, AIU and CEC filed an answer to the First Amended Complaint, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. Career Education Corp. -- http://www.careered.com/-- is an educational services company. The company's schools and universities prepare students for professional careers through the operation of more than 75 on-ground campuses located throughout the U.S., France, Canada, Italy and the U.K., and three online academic programs. During the year ended Dec. 31, 2007, the company had approximately 89,500 students. The schools and universities offer doctoral degree, master's degree, bachelor's degree, associate degree, and non-degree certificate and diploma programs in Culinary Arts, Visual Communication and Design Technologies, Health Education, Business Studies and Information Technology. The segments of the company include Academy, Colleges, Culinary Arts, Health Education, International and University. CAREER EDUCATION: Faces Calif. Lawsuit Over Admissions Process -------------------------------------------------------------- Career Education Corp. and California School of Culinary Arts, Inc., are facing a purported class-action suit in California in connection with their admissions process, according to CEC's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The putative class-action suit was filed on June 23, 2008, in the Los Angeles County Superior Court entitled, "Daniel Vasquez and Cherish Herndon v. California School of Culinary Arts, Inc. and Career Education Corporation." The plaintiffs allege causes of action for fraud, constructive fraud, violation of the California Unfair Competition Law and violation of the California Consumer Legal Remedies Act. They also allege improper conduct in connection with the admissions process during the alleged class period. The alleged class is defined as including "all persons who purchased educational services from CSCA, or graduated from CSCA, within the limitations periods applicable to the herein alleged causes of action (including, without limitation, the period following the filing of the action)." The company reported no development in the matter in its regulatory filing. Career Education Corp. -- http://www.careered.com/-- is an educational services company. The company's schools and universities prepare students for professional careers through the operation of more than 75 on-ground campuses located throughout the U.S., France, Canada, Italy and the U.K., and three online academic programs. During the year ended Dec. 31, 2007, the company had approximately 89,500 students. The schools and universities offer doctoral degree, master's degree, bachelor's degree, associate degree, and non-degree certificate and diploma programs in Culinary Arts, Visual Communication and Design Technologies, Health Education, Business Studies and Information Technology. The segments of the company include Academy, Colleges, Culinary Arts, Health Education, International and University. CAREER EDUCATION: Seeks Dismissal of "Blake" Lawsuit in Missouri ---------------------------------------------------------------- Career Education Corp. and Sanford Brown College are seeking the dismissal of a class-action complaint filed in the Circuit Court of the County of St. Louis, State of Missouri, over allegations that the company "sells" college degrees in criminal justice by misrepresenting tuition, the quality of the staff, job placement services, and transferability of credits. The plaintiffs bring the class action suit pursuant to Rule 52.08 of the Missouri Rules of Civil Procedure and Section 407.025 RSMo on behalf of all Missouri citizens who were paying students of the associate and bachelor degree programs in criminal justice st Sanford Brown College during the period from Jan. 1, 2003, through Jan. 1, 2008 (Class Action Reporter, March 5, 2008). The suit, entitled "Blake v. Career Education Corporation," alleges that the defendants violated the Missouri Merchandising Practices Act (Section 407.010 RSMo, et seq.) by purposefully employing a pattern and practice of deception, fraud, and misrepresentation in the sale of the Criminal Justice Degree Programs to potential students. The suit also alleges that the employees and agents of the defendants made misrepresentations to them which deceived them to believe that associate and bachelor criminal justice degrees from SBC were valuable when in reality the degrees had little to no practical value in the real world. The plaintiffs want the court to rule on: (a) whether the Missouri Merchandising Practices Act, Section 407.010 RSMo, et seq., was violated by the defendants' acts and omissions, as alleged; and (b) whether plaintiffs and members of the class have sustained injury by reason of defendants' actions and omissions. They request for injunctive relief enjoining the defendants from utilizing the deceptive and unfair business practices, and judgment in favor of the plaintiffs and members of the class and against the defendants, and award the plaintiffs actual damages in an amount to be proven at trial, for a sum greater than $25,000, punitive damages in an amount to be proven at trial, the plaintiffs' reasonable costs and attorneys' fees incurred,but in no event any total sum greater than $4,999,99, and for such other and further relief as the court deems proper under the premises. The defendants have filed a motion to dismiss the case, which request is currently pending with the court, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Janet Blake et al. v. Career Education Corporation, et al., Case No. 0822-CC000777," filed in the Circuit Court of the County of St. Louis, State of Missouri. Representing the plaintiffs are: Matthew C. Casey, Esq. Matthew J. Devoti, Esq. Casey & Devoti, P.C. 100 North Broadway, Suite 1000 St. Louis, MO 63102 Phone: 314-421-0763 Fax: 314-421-5059 e-mail: info@caseydevoti.com Web site: http://www.caseydevoti.com CAREER EDUCATION: Reaches Ill. FLSA Violations Suit Settlement -------------------------------------------------------------- A tentative settlement was reached in the purported class-action suit filed in the U.S. District Court for the Northern District of Illinois against Career Education Corp., American InterContinental University, Inc. (AIU Online), and the president of the company's Online Education Group. The suit, entitled "Paul Vander Vennet, et al. v. American InterContinental University, Inc., et al.," was filed on Aug. 24, 2005, by former admissions advisors of AIU, alleging that the defendants violated the Fair Labor Standards Act the Illinois Minimum Wage Law, and the Illinois Wage Payment and Collection Act. It also alleged that defendants failed to pay the plaintiffs for all of the overtime hours they allegedly worked. The plaintiffs are seeking certification as a class under the FLSA and, on Aug. 24, 2005, filed a motion for FLSA Notice. On Dec. 22, 2005, and April 7, 2006, the Court granted plaintiffs' motions to send FLSA Notice, and the plaintiffs' counsel has distributed such notice to certain current and former admissions advisors. On April 7, 2006, the Court granted the plaintiffs' motion to expand the class to include temporary admissions advisors. The deadline for potential plaintiffs to opt-in to this lawsuit was June 23, 2006. Less than 10% of the persons to whom notice of the suit was sent, including current and former admissions advisors, have joined the litigation. The defendants deny all of the material allegations in the complaint. Several of these opt-in plaintiffs have subsequently dropped out of the lawsuit. The parties are in the process of finalizing the terms of a proposed settlement with respect to the remaining plaintiffs, which deal would only be effective upon approval of the court, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Vennet, et al. v. American Intercontinental University Online, et al., Case No. 1:05-cv-04889," filed in the U.S. District Court for the Northern District of Illinois under, Judge William T. Hart, presiding. Representing the plaintiffs is: Robin B. Potter, Esq. (robinpotter@igc.org) Robin Potter & Associates P.C. 111 East Wacker Drive, Suite 2600 Chicago, IL 60601 Phone: 312-861-1800 Representing the defendants is: James M. Gecker, Esq. (james.gecker@kattenlaw.com) Katten Muchin Rosenman, LLP 525 West Monroe Street, Suite 1600 Chicago, IL 60661 Phone: 312-902-5200 CAREER EDUCATION: Faces Suit in Calif. Over Rest & Meal Periods --------------------------------------------------------------- Career Education Corp. is facing a purported class-action suit in California, alleging violations of the California Labor Code for failure to authorize and permit rest and meal periods and failure to pay compensation for work performed during rest and meal periods, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. On Oct. 31, 2007, Tino Anglade, a former Admissions Representative at the California School of Culinary Arts, filed a lawsuit in Los Angeles County, California Superior Court, on behalf of himself and a putative class consisting of all admissions representatives employed by most of CEC's California schools. The plaintiff also alleges a violation of California's unfair competition law asserting that the alleged rest and meal period violations constitute an act of unfair competition. They seeks unspecified lost wages, attorneys' fees, civil and statutory penalties, and injunctive relief. They also seek class certification under California law. Each named California school (California School of Culinary Arts, California Culinary Academy, American InterContinental University�Los Angeles, Brooks College, Brooks Institute, and Kitchen Academy) has been served with the suit. Career Education Corp. -- http://www.careered.com/-- is an educational services company. The company's schools and universities prepare students for professional careers through the operation of more than 75 on-ground campuses located throughout the U.S., France, Canada, Italy and the U.K., and three online academic programs. During the year ended Dec. 31, 2007, the company had approximately 89,500 students. The schools and universities offer doctoral degree, master's degree, bachelor's degree, associate degree, and non-degree certificate and diploma programs in Culinary Arts, Visual Communication and Design Technologies, Health Education, Business Studies and Information Technology. The segments of the company include Academy, Colleges, Culinary Arts, Health Education, International and University. EXTENDICARE HOMES: Extendicare REIT Acknowledges Wash. Lawsuit -------------------------------------------------------------- Extendicare Real Estate Investment Trust acknowledges a class action lawsuit was filed on August 21, 2008, against Extendicare Homes, Inc., and Fir Lane Terrace Convalescent Center, Inc., two wholly owned U.S. based subsidiaries of Extendicare Real Estate Investment Trust, in Washington state court in Seattle. The class action lawsuit alleges that 15 of Extendicare REIT's Washington facilities violated the Washington Consumer Protection Act by fraudulently advertising their services when the corporation knew that the Washington facilities had deficiencies in its surveys. The class action alleges that private pay residents of these facilities were influenced in their choice by the fraudulent advertising practices during a four-year period of time. Extendicare REIT has commenced its preliminary evaluation of the class action lawsuit. Extendicare REIT has never had a claim of fraudulent advertising however is aware of other cases involving other long-term care providers in the recent past. Extendicare REIT, through its wholly owned subsidiaries, is a major provider of short and long-term care services for seniors in North America. FCSTONE GROUP: Lead Plaintiff Application Deadline is Sept. 15 -------------------------------------------------------------- Law Offices of Howard G. Smith announced a September 15, 2008 deadline for investors to move to be a lead plaintiff in the securities class action lawsuit filed on behalf of all purchasers of the common stock of FCStone Group, Inc., between April 10, 2008, and July 9, 2008, inclusive. The shareholder lawsuit is pending in the United States District Court for the Western District of Missouri. The Complaint alleges that the defendants violated federal securities laws by issuing material misrepresentations to the market concerning the FCStone's financial performance and prospects, thereby artificially inflating the price of FCStone stock. For more information, contact: Howard G. Smith, Esq. (howardsmithlaw@hotmail.com) Law Offices of Howard G. Smith 3070 Bristol Pike, Suite 112 Bensalem, PA 19020 Phone: 215-638-4847 Toll-Free: 888-638-4847 Web site: http://www.howardsmithlaw.com/ GENERAL NUTRITION: Alabama Suit Claims Formadrol is Snake Oil ------------------------------------------------------------- General Nutrition Centers is facing a class-action complaint filed in the Circuit Court of Jefferson County, Alabama, alleging it sells adulterated and misbranded dietary supplements made by LG Sciences, and pushing it with false claims that it will "boost testosterone," CourtHouse News Service reports. The plaintiffs claim "Formadrol" contains an unapproved substance -- 4-etioallocholen-3,6,17-trione -- that has not been proven safe. The plaintiffs bring the suit on behalf of all individuals who have purchased any of the LG Sciences products known as Methyl 1-D, Methyl 1-DXL, and Formadrol Extreme XL since their introduction to the market. The plaintiffs want the court to rule on: (a) whether the defendants have disclosed the presence of ATD and 4-etioallocholen 3,6,17-trione; (b) whether the defendants misled the members of the class by not disclosing that the presence of ATD and 4- etioallocholen 3,6,17-trione caused the LG Sciences products to be adulterated; (c) whether the defendants must refund to the plaintiffs and members of the class the purchase prices of the misbranded and adulterated products; (d) whether the defendants breached the product's warranty by selling adulterated and misbranded products and whether the products, as labeled, are unmerchantable; (e) whether the defendants must make restitution to the plaintiffs and the members of the class; (f) whether defendants must disgorge any profit and/or income derived from its wrongful conduct. The plaintiffs ask the court for: -- an order that this action may be maintained as a class under Alabama Rules of Civil Procedure 23(b)(1)(A) and 23(b)(2)(3); -- a declaration that for each year LG Sciences has manufactured, produced, marketed, offered for sale and sold its products described, and the other defendants, too, and each of them, have marketed and sold the adulterated products in derogation of the law; -- a declaration that for each year since the inception of the products described, GNC have advertised, marketed, offered for sale and sold the adulterated products in derogation of the law; -- an order that the defendants pay to the plaintiffs and the class all amounts obtained or received by defendants as a result of the wrongful conduct and misbranding and adulteration specified; -- an order enjoining the defendants from continuing to misbrand, advertise, market, offer for sale and sell LG Sciences Methyl 1-D, Methyl 1-DXL and Formadrol Extreme XL; -- a determination that the total award to representative plaintiffs and the proposed class will under no circumstances exceed $5 million; and -- such other and further relief as is just and equitable under the circumstances. The suit is "Timothy Lee, et al. v. LG Sciences LLC, et al., Case No. CV200802619," filed in the Circuit Court of Jefferson County, Alabama. Representing the plaintiffs is: Samuel M. Hill, Esq. The Law Offices of Sam Hill, LLC 2117 Magnolia Avenue Birmingham, AL 35205 Phone: 205-250-7776 Fax: 205-250-7675 GOODYEAR: USW Hails Approval of Retirees' $1B Health Care Fund -------------------------------------------------------------- The United Steelworkers applauded the judgment issued by the U.S. District Court for the Northern District of Ohio, approving the $1 billion Voluntary Employees' Benefits Association trust fund, established as part of a 2006 contract settlement following an 86-day strike. "This decision confirms the victory we achieved as a result of the work stoppage," said USW International President Leo W. Gerard. "Retirees who spent their working lives employed at Goodyear can now be assured that funding for health insurance and prescription drug coverage is protected and cannot be taken away from them." The class action lawsuit was brought by the USW and two Goodyear retirees, Gerald Redington, of Lena, Ill., and Bennett Toller, of Danville, Va. It challenged the company's right to reduce or terminate health care benefits for retirees. The $1-billion trust fund will be removed from Goodyear's hands and taken over by independent fiduciaries with expertise in health care benefits. Nine trustees will oversee the fund. Three will be appointed by the union; four are public members, drawn from experts in the health care field; and two trustees will be appointed by Redington and Toller. "The union will not operate the fund but our members will contribute to it in the future," said Ron Hoover, USW executive vice president of the Rubber and Plastic Industry Conference (R/PIC). "Trustees of the fund and the fund's management will be working strictly on behalf of Goodyear's retirees." The Goodyear Tire & Rubber Company is the third largest tire company in the world after Bridgestone and Michelin. Goodyear manufactures tires for automobiles, commercial trucks, race cars, airplanes, and heavy earth-mover machinery. J2 GLOBAL: Calif. Court Orders Stay on Internet Facsimile Suit -------------------------------------------------------------- The U.S. District Court for the Central District of California entered an order staying a purported class-action suit against j2 Global Communications, Inc., that alleges the company has attempted to monopolize and monopolized the market for Internet facsimile services to home and small offices, in violation of Section 2 of the Sherman Act. The suit was filed on June 29, 2007, by Justin Lynch. The claims relate in substantial part to the patent infringement actions by the company against various companies. The suit seeks treble damages, injunctive relief, attorneys fees and costs. On Aug. 24, 2007, the company filed an answer to the complaint denying liability. The case is stayed. The company reported no further development in the matter in its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Justin Lynch v. j2 Global Communications Inc. et al., Case No. 2:07-cv-04304-DDP-AJW," filed in the U.S. District Court for the Central District of California, Judge Dean D. Pregerson, presiding. Representing the plaintiffs are: Steve W. Berman, Esq. (steve@hbsslaw.com) Hagens Berman Sobol Shapiro 1301 5th Avenue, Ste 2900 Seattle, WA 98101 Phone: 206-623-7292 - and - Mark J. Tamblyn, Esq. (mjt@wtwlaw.us) Wexler Toriseva Wallace 1610 Arden Way, Suite 290 Sacramento, CA 95815 Phone: 916-568-1100 MRV COMMS: Lead Plaintiff Application Deadline Set For Sept. 8 -------------------------------------------------------------- Pomerantz Haudek Block Grossman & Gross LLP reminds investors of MRV Communications Inc. that September 8 is the deadline for them to seek the Court's appointment as lead plaintiff for the class in the pending class action against the company. The Pomerantz Firm filed a class action lawsuit against MRV and certain officers of the company in the United States District Court, Central District of California. The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and was filed on behalf of purchasers of the common stock of the Company between July 24, 2003, and June 5, 2008. MRV Communications is a Delaware corporation which maintains its principal executive office in Chatsworth, California. The company supplies communications equipment and services to carriers, governments and enterprise customers worldwide. The complaint alleges that unbeknownst to investors and contrary to its public representations, MRV issued stock options that were deliberately backdated in order to provide improper windfalls to the individual defendants. Moreover, defendants compounded the fraud by improperly accounting for the backdated options, thereby inflating reported results. Finally, the Company belatedly admitted that such misconduct had taken place. The complaint specifically alleges that: (1) the Company backdated the actual grants of its stock options grants and improperly recognized stock-based compensation expenses related to its stock options grants; (2) the Company failed to disclose that the stock option grants had not been accounted for in accordance with Generally Accepted Accounting Principles; (3) the Company materially understated tax expenses, since MRV had improperly deducted such expenses on its tax returns, thereby reducing the amount of taxes to the extent owed; and (4) the Company failed to accurately report its financial statements and will now have to restate its historical financial statements for the period between 2002 and 2008. For more information, contact: Teresa Webb, Esq. (tlwebb@pomlaw.com) Pomerantz Haudek Block Grossman & Gross LLP 100 Park Avenue New York, NY 10017-5516 Phone: 888-476-6529 888-4.POMLAW NUTRISYSTEM INC: Seeks Dismissal of Consolidated Securities Suit ---------------------------------------------------------------- NutriSystem, Inc., and certain of its officers and directors filed a motion seeking the dismissal of a consolidated class action suit filed against them that alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The suits were filed in the U.S. District Court for the Eastern District of Pennsylvania on Oct. 9, 2007. They purport to bring claims on behalf of a class of individuals who purchased the company's common stock between Feb. 14, 2007, and Oct. 3 or Oct. 4, 2007. The complaints allege that the defendants issued various materially false and misleading statements relating to the company's projected performance that had the effect of artificially inflating the market price of its securities. These suits were consolidated in December 2007 under the caption, "Kairalla v. NutriSystem, inc. et al., Case No. 2:07- cv-04215-MK." On Jan. 3, 2008, the Court appointed lead plaintiffs and lead counsel pursuant to the requirements of the Private Securities Litigation Reform Act of 1995, and a consolidated amended complaint was filed on March 7, 2008. The consolidated amended complaint raises the same claims but alleges a class period of Feb. 14, 2007, through Feb. 19, 2008. The defendants filed a motion to dismiss the consolidated suit on May 6, 2008. The plaintiffs' opposition is due July 7, 2008, and defendants' reply is due on Aug. 6, 2008. The company reported no further development in the matter in its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The suit is "Kairalla v. NutriSystem, inc. et al., Case No. 2:07-cv-04215-MK," filed with the the U.S. District Court for the Eastern District of Pennsylvania, Judge Marvin Katz, presiding. Representing the plaintiffs are: Deborah R. Gross, Esq. (debbie@bernardmgross.com) Law Offices Bernard M. Gross, PC 100 Penn Square East John Wanamaker Bldg., Suite 450 Philadelphia, PA 19107 Phone: 215-561-3600 Fax: 215-561-3000 David A. Rosenfeld, Esq. (DRosenfeld@csgrr.com) Coughlin Stoia Geller Rudman & Robbins LLP 58 South Service Rd., Suite 200 Melville, NY 11747 Phone: 631-367-7100 - and - Leon W. Silverman, Esq. (leon@steinandsilverman.com) Stein & Silverman PC 230 S. Broad St. 18th Fl. Philadelphia, PA 19102 Phone: 215-985-0255 Fax: 215-985-0342 Representing the defendants is: Karen Pieslak Pohlmann, Esq. (kpohlmann@morganlewis.com) Morgan, Lewis & Bockius LLP 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5740 Fax: 215-963-5001 NUTRISYSTEM INC: Pa. Court Dismisses Certain Claims in "Parker" --------------------------------------------------------------- The U.S. District Court for the Eastern District of Pennsylvania dismissed the state law claim in the class-action complaint filed against NutriSystem Inc., alleging it failed to pay overtime to an estimated 400 sales associates, according to its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. On March 28, 2008, Adrian E. Parker, a former NutriSystem Inc. sales representative, filed a putative collective action complaint in the U.S. District Court for the Eastern District of Pennsylvania, alleging that NutriSystem unlawfully failed to pay overtime in violation of the Fair Labor Standards Act. The complaint purported to bring claims on behalf of a class of current and former sales representatives who were compensated by NutriSystem pursuant to a commission-based compensation plan, rather than on an hourly basis. The plaintiff filed an amended complaint on May 28, 2008, adding a state-law class claim under the Pennsylvania Minimum Wage Act, alleging that NutriSystem's compensation plan also violated state law. On June 11, 2008, NutriSystem answered the amended complaint and moved to dismiss the plaintiff's state-law class claim. Also, on June 11, 2008, the plaintiff filed a motion to proceed as a collective action and send class members notice under the Fair Labor Standards Act claim. On July 25, 2008, the Court granted NutriSystem's motion to dismiss with respect to the state law claim. The suit is "Parker v. NutriSystem, Inc., Case No. 2:08-cv- 01508-HB," filed in the U.S. District Court for the Eastern District of Pennsylvania, Judge Harvey Bartle III, presiding. Representing the plaintiffs are: Shanon J. Carson, Esq. (scarson@bm.net) Berger & Montague, P.C. 1622 Locust St., Philadelphia, PA 19103 Phone: 215-875-4656 Fax: 215-875-4674 - and - Peter D. Winebrake, Esq. (pwinebrake@winebrakelaw.com) The Winebrake Law Firm LLC Twining Office Center, Suite 114 715 Twining Road Dresher, PA 19025 Phone: 215-884-2491 Fax: 215-884-2492 Representing the defendants is: Sarah E. Bouchard, Esq. (sbouchard@morganlewis.com) Morgan Lewis & Bockius LLP 1701 Market St. Philadelphia, PA 19103 Phone: 215-963-5077 QWEST COMMS: Continues to Face Multiple Rights-of-Way Lawsuits -------------------------------------------------------------- Qwest Communications International, Inc., continues to face several putative class-action suits in state and federal courts in relation to the installation of fiber optic cable in certain rights-of-way. To recall, several putative class action lawsuits in connection with the installation of fiber optic cable in certain rights-of- way were filed against the company on behalf of landowners on various dates and in various courts in California, Colorado, Georgia, Illinois, Indiana, Kansas, Massachusetts, Mississippi, Missouri, Oregon, South Carolina, Tennessee and Texas. For the most part, the complaints challenge the company's right to install fiber optic cable in railroad rights-of-way. The complaints in Colorado, Illinois and Texas, also challenge the company's right to install fiber optic cable in utility and pipeline rights-of-way. The complaints allege that the railroads, utilities and pipeline companies own the right-of-way as an easement that did not include the right to permit the company to install its fiber optic cable in the right-of-way without the plaintiffs' consent. Most actions (California, Colorado, Georgia, Kansas, Mississippi, Missouri, Oregon, South Carolina, Tennessee and Texas) purport to be brought on behalf of state-wide classes in the named plaintiffs' respective states. The Massachusetts action purports to be on behalf of state-wide classes in all states (other than Louisiana and Tennessee) in which Qwest has fiber optic cable in railroad rights-of-way, and also on behalf of two classes of landowners whose properties adjoin railroad rights-of-way originally derived from federal land grants. Several actions purport to be brought on behalf of multi-state classes. The Illinois state court action purports to be on behalf of landowners in Illinois, Iowa, Kentucky, Michigan, Minnesota, Nebraska, Ohio and Wisconsin. The Illinois federal court action purports to be on behalf of landowners in Arkansas, California, Florida, Illinois, Indiana, Missouri, Nevada, New Mexico, Montana and Oregon. The Indiana action purports to be on behalf of a national class of landowners adjacent to railroad rights-of-way over which the company's network passes. The complaints seek damages on theories of trespass and unjust enrichment, as well as punitive damages. The company reported no further development in the matters in its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. Denver, Colorado-based Qwest Communications International, Inc. -- http://www.qwest.com/-- is a provider of voice, data and video services. The company operates most of its business within its local service area, which consists of the 14-state region of Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington and Wyoming. The company operates through three segments: wireline services, wireless services and other services. QWEST COMMS: Faces Suit in Colorado Over Reduction of Benefits -------------------------------------------------------------- Qwest Communications International, Inc., is facing a purported class-action suit in connection with its decision to reduce the life insurance benefit for certain of its retirees to a $10,000 benefit, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The putative class-action suit was filed in the U.S. District Court for the District of Colorado on March 30, 2007, under the caption "Kerber et al. v. Qwest Group Life Insurance Plan et al., Case No. 1:07-cv-00644-WDM-KLM." It was brought on behalf of certain of the company's retirees against the company, the Qwest Life Insurance Plan and other related entities. The plaintiffs allege, among other things, that the company and other defendants were obligated to continue their life insurance benefit at the levels in place before the company decided to reduce them. They seek restoration of the life insurance benefit to previous levels and certain equitable relief. The court ruled in the company's favor on the central issue of whether the company properly reserved its right to reduce the life insurance benefit under applicable law and plan documents. The retirees have amended their complaint to assert additional claims. The company reported no further development in the matter in its regulatory filing. The suit is "Kerber et al. v. Qwest Group Life Insurance Plan et al., Case No. 1:07-cv-00644-WDM-KLM," filed in the U.S. District Court for the District of Colorado, Judge Walker D. Miller, presiding. Representing the plaintiffs is: Curtis L. Kennedy, Esq. (CurtisLKennedy@aol.com) Curtis L. Kennedy, Law Office of 8405 East Princeton Avenue Denver, CO 80237-1741 Phone: 303-770-0440 Fax: 303-834-0360 Representing the defendants is: Michael Brian Carroll, Esq. (mcarroll@sah.com) Sherman & Howard, L.L.C. 633 17th Street, #3000 Denver, CO 80202-3624 Phone: 303-299-8474 Fax: 303-298-0940 RAIT FINANCIAL: Awaits Court's Dismissal of Pa. Securities Suit --------------------------------------------------------------- The U.S. District Court for the Eastern District of Pennsylvania has yet to rule on a motion by RAIT Financial Trust that seeks the dismissal of a consolidated securities fraud class-action suit that was filed against the company, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2008. The company, certain of its executive officers and trustees and the lead underwriters involved in the company's public offering of common shares in January 2007 were named defendants in one or more of nine putative class actions filed in August and September 2007 with the U.S. District Court for the Eastern District of Pennsylvania. By Order dated Nov. 17, 2007, the court consolidated these cases under the caption, "In re RAIT Financial Trust Securities Litigation, Case No. 2:07-cv-03148," and appointed a lead plaintiff and lead counsel. On Jan. 4, 2008, the lead plaintiff filed a consolidated class action complaint on behalf of a putative class of purchasers of the company's securities between June 8, 2006, and August 3, 2007. The complaint names as defendants RAIT, 11 current and former officers and trustees of RAIT, 10 underwriters who participated in certain of the company's securities offerings in 2007, and the company's independent accounting firm. The suit alleges, among other things, that certain defendants violated Sections 11, 12(a)(2) and 15 of the U.S. Securities Act of 1933 by making materially false and misleading statements and material omissions in registration statements and prospectuses about the company's credit underwriting, the company's exposure to certain issuers through investments in debt securities, and the company's loan loss reserves and other financial items. The complaint further alleges that certain defendants violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, and Rule 10b-5 thereunder, by making materially false and misleading statements and material omissions during the putative class period about the company's credit underwriting, the company's exposure to certain issuers through investments in debt securities, and the company's loan loss reserves and other financial items. It seeks unspecified compensatory damages, the right to rescind the purchases of securities in the public offerings, interest, and plaintiffs' reasonable costs and expenses, including attorneys' fees and expert fees. On March 10, 2008, the defendants moved to dismiss the complaint on a number of grounds. The Court permitted the plaintiffs to file a single brief in opposition to all defense motions to dismiss on May 15, 2008. All defendants filed reply briefs in support of dismissal motions on June 5, 2008. Thereafter, RAIT and certain of the officer/trustee defendants sought leave to file a supplemental brief, which the Court permitted as of June 24, 2008. The plaintiffs were permitted a response to the supplemental brief, which was deemed filed as of July 1, 2008. The suit is "A1 Credit company v. RAIT Financial Trust, et al., Case No. 2:07-cv-03148-LDD," filed in the U.S. District Court for the Eastern District of Pennsylvania, Judge Legrome D. Davis, presiding. Representing the plaintiffs are: Gerald S. Berkowitz (gsb@berklein.com) Berkowitz and Klein LLP 625 B Swedesford Rd. Swedsford Corporate Center Malvern, PA 19355-1530 Phone: 610-889-3200 Fax: 610-889-9564 - and - Roberta D. Liebenberg, Esq. (rliebenberg@finekaplan.com) Fine, Kaplan and Black 1835 Market St., 28th Floor Philadelphia, PA 19103 Phone: 215-567-6565 Fax: 215-568-5872 Representing the defendants are: Robert W. Hayes, Esq. (rhayes@cozen.com) Cozen O'Connor 1900 Market Street Philadelphia, PA 19103 Phone: 215-665-2094 Fax: 215-665-2013 - and - Barbara W. Mather, Esq. (matherb@pepperlaw.com) Pepper Hamilton LLP 3000 Two Logan Sq. 18th & Arch Streets Philadelphia, PA 19103-2799 Phone: 215-981-4895 Fax: 215-981-4756 REPUBLIC SERVICES: Shareholders Fight $2.8 Billion Trash Deal ------------------------------------------------------------- Republic Services Inc. is facing a class-action complaint filed in the Court of Chancery of the State of Delaware alleging it is cheating shareholders by merging with Allied Waste Industries and refusing to consider Waste Management's superior offer, CourtHouse News Service reports. This is a class action on behalf of the securities holders of Republic Services who are or will be damaged by the breach of fiduciary duties, including the duties of candor, due care and loyalty, being committed by Republic's board of directors. Republic has 182 million shares outstanding, according to the complaint. Its pre-announcement price was $33.66 a share; Allied shares traded at $13.92. The complaint states, without explanation, that this made "the implied transaction price per share worth $15.15" -- or $2.8 billion. The plaintiff brings this action as a class action, pursuant to Rule 23 of the Rules of the Court of Chancery, on behalf of all securities holders of the company and their successors in interest, who are or will be threatened with injury arising from defendants' actions. The plaintiff wants the court to rule on: (a) whether the individual defendants have violated their fiduciary obligations to the class; (b) whether the class is entitled to injunctive relief (preliminary or otherwise) or damages as a result of the wrongful conduct committed by defendants; (c) whether defendants are attempting to entrench themselves; (d) whether the defendants intend to solicit shareholder approval of the transaction by way of false and misleading proxy; (e) whether defendants have breached any of their fiduciary duties to plaintiff and the other members of the class in connection with taking action to frustrate a bid by Waste management and suitors and their failure to comply with their duties of loyalty, good faith, diligence, due care, independence, candor and fair dealing; and (f) whether defendants, in bad faith and for improper motives, have impeded or erected barriers to discourage other offers for the company or its assets. The plaintiff demands judgment: -- declaring that this action is properly maintainable as a class action and certifying plaintiff as the representative of the class; -- preliminarily and permanently enjoining defendants and their counsel, agents, employees, and all persons acting under, in concert with, or for them, from proceeding with, consummating, or closing the transaction, including preliminarily and permanently enjoining the vote on the transaction, and in the event that the transaction is consummated, rescinding it and setting it aside; -- directing the individual defendants to fairly and fully investigate, assess and evaluate the alternatives to the proposed merger, including the Waste Management proposal, and to fully comply with their fiduciary duties and act in accordance with the terms of the "fiduciary out" provisions of the Merger Agreement; -- awarding compensatory damages against defendants, individually and severally, in an amount to be determined at trial, together with pre-judgment and post-judgment interest at the maximum rate allowable by law, for damages suffered by plaintiff and the class as a result of defendants' wrongful conduct, including pre- and post-judgment interest; -- awarding plaintiff his costs and disbursements and reasonable allowances for fees of plaintiff's counsel and experts and reimbursement of expenses; and -- granting plaintiff and the class such other and further relief as the court may deem just and proper. The suit is "David Shade, et al. v. Republic Services, Inc., et al., Transaction ID: 21158705," filed in the Court of Chancery of the State of Delaware. Representing the plaintiff are: Pamela S. Tikellis, Esq. Robert J. Kriner, Jr., Esq. Scott M. Tucker, Esq. Chimicles & Tikellis, LLP One Rodney Square, P.O. Box 1035 Wilmington, DE 19899 Phone: 302-656-2500 Fax: 302-656-9053 SAN DIEGO CITY: Police Officers File Suit Over Unpaid Overtime -------------------------------------------------------------- The Petersen Law Firm, a Law Corporation, filed a class action grievance against the City of San Diego for failing to properly pay its police officers for pre- and post-shift activities, missed or interrupted meal periods and reimburse its officers for job related expenses. The grievances that are alleged are common to almost all of the police officers covered under the Memorandum of Understanding, which governs the terms of employment between the police officers and the City of San Diego. The four San Diego Police Officers named in the complaint are alleging a class action grievance on their behalf and on behalf of similarly situated officers. The four named officers, and those officers similarly situated, performed many hours of integral and indispensable pre- and post-shift duties per week that were not compensated, in violation of the MOU. These activities include, but are not limited, to: -- preparing for roll-call; -- shift wrap-up briefings; -- preparing for inspections; -- report writing; -- completing activity logs; -- loading and unloading patrol vehicles; -- preparing for court appearances; -- cleaning weapons and gear, collecting, returning and maintaining equipment; -- on-site donning and doffing of protective equipment and uniforms; -- traveling to and from court; and -- range certification. The grievance also states that the police officers were consistently interrupted during their code 7s or worked through their code 7s for which they were not paid or not paid premium pay for instances of missed code 7s, which is also a violation of the MOU. These were not isolated violations but occurred frequently, and continue to occur, given the nature of a police officer's duties and the need for prompt and immediate action. This is a problem that was known and recognized by the department but has been ignored. Additionally, the officers, and other officers similarly situated, were not properly reimbursed for expenses associated with the maintenance and replacement of their uniforms. The City improperly included the expense reimbursement as part of the officers' wages and taxes the reimbursement, yet did not include the money in the calculation of officer's base pay. Greg Petersen, Esq., Managing Partner the Petersen Law Firm, commented, "We look forward to the City's response to these issues. They come as no surprise to the City of San Diego since it has been involved in litigation on these very issues for more than two years." For more information, contact: Jeff Leonard, Esq. The Petersen Law Firm Phone: 949-335-1300 SMITHKLINE BEECHAM: Faces Pa. Lawsuit Over Allergy Drug Flonase --------------------------------------------------------------- SmithKline Beecham Corporation -- d/b/a GlaxoSmithKline Plc -- is facing an antitrust class-action complaint filed in the U.S. District Court for the Eastern District of Pennsylvania accusing it of delaying release of generic forms of its allergy drug Flonase (fluticasone proprionate) by filing "groundless citizen petitions with the Food and Drug Administration," CourtHouse News Service reports. The plaintiff brings this nationwide class action on behalf of indirect purchasers of the prescription drug Flonase and its generic equivalent (fluticasone propionate) who did not purchase the drug for resale at any time from May 19, 2004, until the anticompetitive effects of defendant's conduct ceased. The lawsuit centers on GSK's filings of groundless citizen petitions with the FDA for the exclusive purpose of obstructing the entry of generic Flonase into the market. GSK's filings constituted an abuse of the citizen petition process established by Section 505(j) of the Federal Food, Drug and Cosmetic Act (FDCA). The plaintiff wants the court to rule on: (a) whether GSK delayed or prevented generic manufacturers from entering the market in the United States; (b) whether GSK's petitions to the FDA were objectively baseless; (c) whether GSK prolonged its monopoly on Flonase by illegally delaying generic entry through its filing of sham citizen petitions with the FDA; (d) whether direct proof exists of GSK's monopoly power, and if so, whether such proof sufficiently demonstrates GKS's monopoly power without the need to define a relevant market; (e) if relevant market or markets must be defined, what that definition is; (f) whether the activities of GSK as alleged have substantially affected interstate commerce; and (g) whether, and to what extent, GSK's conduct caused antitrust injury to the business or property of plaintiff and the members of the class, and if so, what the appropriate measure of damage is. The plaintiff asks the court for an order: -- certifying the class in accordance with the Federal Rules of Civil Procedure, certifying plaintiff as the representative of the class, and designating its counsel as counsel for the class; -- declaring defendant's conduct to be in violation of the antitrust and deceptive practice statutes in the indirect purchaser states; -- granting plaintiff and the class equitable relief in the nature of disgorgement, restitution, and the creation of a constructive trust to remedy defendant's unjust enrichment; -- granting plaintiff and the class damages as permitted by law; -- granting plaintiff the right of disgorgement; -- granting plaintiff and the class their costs of prosecuting this action, together with interest and reasonable attorneys' fees, experts' fees and other costs; and -- granting such other relief as the court may deem just and proper. The suit is "A.F. of L.-A.G.C. Building Trades Welfare Plan et al. v. SmithKline Beecham Corp.," filed in the U.S. District Court for the Eastern District of Pennsylvania. Representing the plaintiff are: Anthony J. Bolognese, Esq. Joshua H. Grabar, Esq. Bolognese & Associates, LLC Two Penn Center 1500 JFK Boulevard, Suite 320 Philadelphia, PA 19102 Phone: 215-814-6750 Fax: 215-814-6764 SPRINT NEXTEL: Discovery Ongoing in Kansas Securities Fraud Suit ---------------------------------------------------------------- Discovery is ongoing in a purported class action lawsuit, captioned "State of New Jersey And Its Division of Investment, et al. v. Sprint Corporation et al., Case No. 2:03cv2071-JWL," which was filed in the U.S. District Court for the District of Kansas and names Sprint Nextel Corp. as a defendant. The suit is alleging that the company's 2001 and 2002 proxy statements were false and misleading in violation of federal securities laws to the extent they described new employment agreements with senior executives without disclosing that, according to the allegations, replacement of those executives was inevitable. These allegations, made in an amended complaint in a lawsuit originally filed in 2003, are asserted against the company and certain current and former officers and directors, and seek to recover any decline in the value of FON and PCS common stock during the class period. The parties have stipulated that the case can proceed as a class action. Allegations in the original complaint, which asserted claims against the same defendants and the company's former independent auditor, were dismissed by the court in April 2004. The company's motion to dismiss the amended complaint was denied in September 2004, and the parties are engaged in discovery. The company reported no further development in the matter in its Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for quarter ended June 30, 2008. The suit is "State of New Jersey And Its Division of Investment, et al. v. Sprint Corporation et al., Case No. 2:03cv2071-JWL," filed in the U.S. District Court for the District of Kansas, Judge John W. Lungstrum, presiding. Representing the plaintiffs are: Thomas R. Buchanan, Esq. (tbuchanan@mcdowellrice.com) McDowell, Rice, Smith & Buchanan, PC -- KC 605 West 47th Street, Suite 350 Kansas City, MO 64112 Phone: 816-753-5400 816-960-7388 Fax: 816-753-9996 - and - Gregory M. Castaldo, Esq. (gcastaldo@sbtklaw.com) Schiffrin & Barroway Topaz & Kessler LLP 280 King of Prussia Road Radnor, PA 19087 Phone: 610-667-7706 Fax: 610-667-7056 Representing the defendants are: Francis P. Barron, Esq. (fbarron@cravath.com) Cravath, Swaine & Moore LLP Worldwide Plaza, 825 Eighth Avenue New York, NY 10019-7475 Phone: 212-474-1000 Fax: 212-474-3700 - and - Chad C. Beaver, Esq. (cbeaver@spencerfane.com) Spencer Fane Britt & Browne LLP KC 1000 Walnut, Suite 1400 Kansas City, MO 64106-2140 Phone: 816-474-8100 Fax: 816-474-3216 VATERROTT EDUCATION: Mo. Lawsuit Alleges Defrauding of Students --------------------------------------------------------------- Vatterott Education Holdings Inc. is facing a class-action complaint filed in the 21st Judicial Circuit Court in St. Louis County, Missouri, alleging it defrauded students with false claims about the quality of its education, CourtHouse News Service reports. Vatterott charged more than $30,000 but failed to provide computers or an instructor for a computer programming class, and "had other students teach the class," the complaint states. The suit is filed on behalf of all students who attended Vatterott College during the winter 2006 school term who were enrolled in the Programmable Logic Controller class at the Sunset Hills Campus. The plaintiffs want the court to rule on whether: (a) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (b) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (c) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (d) the difficulties likely to be encountered in the management of a class action. The plaintiffs demand for an award of money damages sufficient to compensate them for their damages incurred, an award of punitive damages assessed against defendants. The suit is "Logan Michels, et al. v. Vatterott Education Holdings, Inc. et al.," filed in the 21st Judicial Circuit Court in St. Louis County, Missouri. Representing the plaintiffs is: Robert Herman, Esq. (gherman@621skinker.com) Schwartz, Herman & Davidson 621 North Skinker Boulevard St. Louis, MO 63130 Phone: 314-862-0200 Fax: 314-862-3050 WENDY'S INT'L: Parties in Triarc Merger Suits Seek Consolidation ---------------------------------------------------------------- The parties in three purported class-action suits filed in Ohio against Wendy's International, Inc., over its merger agreement with Triarc Cos., Inc., and Green Merger Sub, Inc., are seeking the consolidation of the cases, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 29, 2008. Merger Agreement On April 23, 2008, the company entered into an Agreement and Plan of Merger with Triarc Companies and Green Merger Sub, a wholly owned subsidiary of Triarc. The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into Wendy's International, with Wendy's International continuing as the surviving corporation and as a wholly owned subsidiary of Triarc. The Merger has been approved by the board of directors of both the company and Triarc. Guiseppone Litigation On April 25, 2008, a putative class action complaint was filed by Ethel Guiseppone on behalf of herself and others similarly situated, against the company, its directors, Triarc and Trian Partners in the Franklin County, Ohio Court of Common Pleas. A motion for leave to file an amended complaint was filed on June 19, 2008. The proposed amended complaint alleged breach of fiduciary duties arising out of the board of directors' search for a merger partner and out of its approval of the Merger Agreement on April 23, 2008, and failure to disclose material information related to the Merger in the Form S-4 that Triarc filed with the U.S. Securities and Exchange Commission. The proposed amended complaint sought certification of the proceeding as a class action; preliminary and permanent injunctions against disenfranchising the purported class and consummating the Merger; a declaration that the defendants breached their fiduciary duties; costs and attorneys fees; and any other relief the court deems proper and just. Henzel Litigation On April 25, 2008, a putative derivative class action complaint was filed by Cindy Henzel, on behalf of herself and others similarly situated, and derivatively on behalf of the company, against the company and its directors in the Franklin County, Ohio Court of Common Pleas. A motion for leave to file an amended complaint was filed on June 16, 2008. The proposed amended complaint alleges breach of fiduciary duties arising out of the board of directors' search for a merger partner and out of its approval of the Merger Agreement on April 23, 2008, and failure to disclose material information related to the Merger in the Form S-4 that Triarc filed with the U.S. Securities and Exchange Commission. The proposed amended complaint sought certification of the proceeding as a derivative and class action; an injunction against consummating the Merger and requiring the defendants to promptly hold an annual meeting and to seek another merger partner; rescission of any part of the Merger Agreement already implemented; a declaration that the defendants breached their fiduciary duties; costs and attorneys fees; and any other relief the court deems proper and just. Smith Litigation On May 22, 2008, a putative class-action complaint was filed by Ronald Donald Smith, on behalf of himself and others similarly situated, against the company and its directors in the Franklin County, Ohio Court of Common Pleas. A motion for leave to file an amended complaint was filed on June 30, 2008. The proposed amended complaint alleged breach of fiduciary duties arising out of the board of directors' search for a merger partner and out of its approval of the Merger Agreement on April 23, 2008, and failure to disclose material information related to the Merger in the Form S-4 that Triarc filed with the U.S. Securities and Exchange Commission. The Smith action seeks the same relief as the Henzel action. Proposed Consolidation of Ohio Cases On July 9, 2008, the parties to the three Ohio actions filed a stipulation and proposed order that would consolidate the cases, provide for the proposed amended complaint in the Henzel case to be the operative complaint in each of the cases, designate one law firm as lead plaintiffs' counsel, and establish an answer date for the defendants in the consolidated case. The court entered the order as proposed in all three cases on July 9, 2008. Wendy's International, Inc. -- http://www.wendys.com/-- is primarily engaged in the operation, development and franchising of quick-service restaurants. As of Dec. 31, 2007, the company and its franchise owners operated 6,645 restaurants under the name Wendy's in 50 states and in 19 other countries and territories. Of these restaurants, 1,414 restaurants were operated by the company, and 5,231 restaurants were operated by its franchisees. Each Wendy's restaurant offers a relatively standard menu featuring hamburgers and filet of chicken breast sandwiches, which are prepared to order with the customer's choice of condiments. The New Bakery Co. of Ohio, Inc., a wholly owned subsidiary of the company, is a producer of buns for Wendy's restaurants, and to a lesser extent for outside parties. At Dec. 30, 2007, the Bakery supplied 637 restaurants operated by the company and 2,366 restaurants operated by franchisees. WENDY'S INT'L: N.Y. Lawsuit Over Triarc Merger Agreement Stayed --------------------------------------------------------------- A purported class-action suit filed in New York against Wendy's International, Inc., over its merger agreement with Triarc Cos., Inc., and Green Merger Sub, Inc., has been stayed, according to the company's Aug. 6, 2008 Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 29, 2008. Merger Agreement On April 23, 2008, the company entered into an Agreement and Plan of Merger with Triarc Companies and Green Merger Sub, a wholly owned subsidiary of Triarc. The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into Wendy's International, with Wendy's International continuing as the surviving corporation and as a wholly owned subsidiary of Triarc. The Merger has been approved by the board of directors of both the company and Triarc. Ravanis Litigation On June 13, 2008, a putative class action complaint was filed by Peter D. Ravanis and Dorothea Ravanis, on behalf of themselves and others similarly situated, against the company, its directors, and Triarc in the Supreme Court of the State of New York, New York County. An amended complaint was filed on June 20, 2008. The amended complaint alleges breach of fiduciary duties arising out of the board of directors' search for a merger partner and out of its approval of the Merger Agreement on April 23, 2008, and failure to disclose material information related to the Merger in the Form S-4 that Triarc filed with the U.S. Securities and Exchange Commission. The amended complaint seeks certification of the proceeding as a class action; preliminary and permanent injunctions against consummating the Merger; other equitable relief; attorneys fees; and any other relief the court deems proper and just. All parties to the Ravanis case have jointly requested that the court stay the action pending resolution of the Ohio cases. Wendy's International, Inc. -- http://www.wendys.com/-- is primarily engaged in the operation, development and franchising of quick-service restaurants. As of Dec. 31, 2007, the company and its franchise owners operated 6,645 restaurants under the name Wendy's in 50 states and in 19 other countries and territories. Of these restaurants, 1,414 restaurants were operated by the company, and 5,231 restaurants were operated by its franchisees. Each Wendy's restaurant offers a relatively standard menu featuring hamburgers and filet of chicken breast sandwiches, which are prepared to order with the customer's choice of condiments. The New Bakery Co. of Ohio, Inc., a wholly owned subsidiary of the company, is a producer of buns for Wendy's restaurants, and to a lesser extent for outside parties. At Dec. 30, 2007, the Bakery supplied 637 restaurants operated by the company and 2,366 restaurants operated by franchisees. ZURN INDUSTRIES: Sued Over Defective Brass Fittings Warranty ------------------------------------------------------------ Zurn Industries LLC and Zurn Pex Inc. are facing a class-action complaint filed in the U.S. District Court for the Southern District of Alabama alleging the companies won't honor its warranty for defective brass fittings in its Zurn Plumbing System, which leak and cause property damage, CourtHouse News Service reports. The complaint alleges the Zurn Plumbing System caused severe damage to Alabama homes, offices and buildings upon installation. The Zurn Plumbing System was designed to carry tap water as well as in-floor hot water heating systems. As a result of the defendants' failure to properly design, develop, test, manufacture, distribute, market, and sell the Zurn Plumbing System, and failure to ensure that the Zurn Plumbing System was properly installed, the plaintiff suffered damages. The defendants warrant and advertise that their brass fittings provide "a worry-free" plumbing system. The defendants warrant and advertise that, with their brass fittings, "you can rest assured that your new plumbing . . . system will provide a lifetime of reliable services," the complaint states. However, the defendants refuse to honor their purported 25-year warranty because the failures are allegedly not "covered in Zurn's cost structure." The defendants are responsible and liable for, among other things, the costs of removing and replacing the Zurn Plumbing System installed in the homes, offices, buildings and other structures belonging to the plaintiff and members of the proposed class, as well as other related consequential damages that resulted from the defendants' defective fittings. The plaintiff seeks to bring this case as a class action, pursuant to Rule 23 of the Federal Rules of Procedure, on behalf of all persons and entities that own a commercial or residential structure located within the State of Alabama that contains a Zurn Plumbing System consisting of linked Pex tubing and brass fitting; additionally, every individual or entity that paid for or performed on its own behalf repairs of damage to a commercial or residential structure located within the State of Alabama, where such damage was caused by the failure of a Zurn Plumbing System. The plaintiff wants the court to rule on: (a) whether defendants sold and entered a defective product into the stream of commerce in Alabama and other states; (b) whether defendants failed to prevent damages which occurred because of the defective product they designed, manufactured and sold into the stream of commerce; (c) whether defendants failed to warn consumers about the reasonably foreseeable dangers of using the Zurn Plumbing System; (d) whether defendants were unjustly enriched by the sale of the defective product; (e) whether defendants breached the 25-year warranty they represented as existing and engaged in fraudulent, false, deceptive and misleading misconduct with respect to the handling of warranty claims; (f) whether defendants omitted material information or provided false information when they sold the Zurn Plumbing System; and (g) whether the members of the class have sustained damages and, if so, the proper measure of such damages. The plaintiff requests that the Court: 1) declare, adjudge and decree that the defendants have committed the violations of state law alleged herein; 2) determine that under Rule 23 of the Federal Rules of Civil Procedure, this civil action may be maintained as a class action, and certify it as such; 3) order that judgment is entered for the plaintiff and the class on their claims against the defendants; 4) award plaintiff and the class damages, as determined at trial, with interest; 5) award plaintiff and the class restitution of profits from the illegal manufacture and sale of the Zurn Plumbing System and otherwise preclude the defendant's unjust enrichment; 6) award plaintiff and the class punitive damages, as determined at trial; 7) award plaintiff and the class their costs, including counsel and experts' fees, prejudgment interest, and such other and further relief as this Court may deem just and proper. The suit is "Gerald Adams et al. v. Zurn Pex Inc., Case No. 08- 484," filed in the U.S. District Court for the Southern District of Alabama . Representing the plaintiff are: Michael A. McShane, Esq. (mmcshane@audetlaw.com) Jessica E. Hawk, Esq. Audet & Partners, LLP 221 Main Street, Suite 1460 San Francisco, CA 94105 Phone: 415-568-2555 Fax: 415-576-1776 New Securities Fraud Cases CHINA SHENGHOU: Rosen Firm Files Securities Fraud Suit in N.Y. -------------------------------------------------------------- The Rosen Law Firm filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all purchasers of China Shenghuo Pharmaceutical Holdings, Inc., common stock during the period from July 23, 2007, through and including August 20, 2008. The complaint charges that CSP and certain of its officers and directors violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by issuing materially false and misleading statements pertaining to CSP's business prospects and condition, and filing materially false financial statements with the SEC. On August 20, 2008, the Company announced that its previously issued financial statements for the fiscal periods ended June 30, September 30, and December 30, 2007 and fiscal quarter ended March 31, 2008, should no longer be relied upon and would be restated due to certain accounting errors, internal control issues and related matters. News that the Company's financial statements must be restated caused the Company's stock price to fall dramatically damaging investors. Interested parties may move the court no later than October 22, 2008 for lead plaintiff appointment. For more information, contact: Laurence Rosen, Esq. Phillip Kim, Esq. The Rosen Law Firm P.A. Phone: 212-686-1060 Toll Free: 1-866-767-3653 Fax: 212-202-3827 Web site: http://www.rosenlegal.com/ CIT GROUP: Schiffrin Barroway Files Securities Suit in New York --------------------------------------------------------------- The law firm of Schiffrin Barroway Topaz & Kessler, LLP gave notice that a class action lawsuit was filed in the United States District Court for the Southern District of New York on behalf of all purchasers of securities of CIT Group Inc. from April 18, 2007, through March 5, 2008, inclusive. The Complaint charges CIT and certain of its officers and directors with violations of the Securities Exchange Act of 1934. CIT is a commercial finance company that provides financial products and advisory services. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company had made tens of millions of dollars of loans to students attending Silver State Helicopter ("Silver State"), and that there was little chance of their repayment; (2) that the Company should have taken a write-down for the Silver State loans in its financial statements; (3) that as a result, the Company's financial statements were not prepared in accordance with Generally Accepted Accounting Principles; (4) that the Company lacked adequate internal and financial controls; and (5) that, as a result of the foregoing, the Company's financial statements were materially false and misleading at all relevant times. Up until very recently, CIT had participated in the student loan market through its Student Loan Xpress unit. The majority of CIT's private student loans were made to non-traditional schools, which have a lower graduation rate than traditional schools (the graduation rate being a critical factor in a borrower's ability to pay back a loan). CIT had been making private loans to students attending Silver State, a non- traditional school. As of December 31, 2007, Silver State students accounted for $196 million in CIT's outstanding student loans, an astounding 32 percent of CIT's $599.3 million of finance receivables related to private student loans. On January 31, 2008, Citibank announced that it would refuse to make any additional private student loans to Silver State students, due to its strong suspicion that the loans would not be repaid. The following day, on February 1, 2008, Silver State declared bankruptcy and ceased all operations. It was subsequently revealed that Silver State had assets of only $50,000 and liabilities in the tens of millions of dollars. On March 6, 2008, investors were shocked when Keefe, Bruyette & Woods issued an analyst report that lowered CIT's first quarter 2008 earnings per share estimate from $0.76 to $0.08. The report stated that CIT would be forced to write-down a significant portion of its private student loan portfolio. Upon the release of this news, the Company's shares fell $4.50 per share, or 22.10 percent, to close on March 6, 2008 at $15.86 per share, on unusually heavy trading volume. Plaintiff seeks to recover damages on behalf of class members. Interested parties may move the court no later than September 23, 2008 for lead plaintiff appointment. For more information, contact: Darren J. Check, Esq. David M. Promisloff, Esq. Schiffrin Barroway Topaz & Kessler, LLP 280 King of Prussia Road Radnor, PA 19087 Phone: 1-888-299-7706 (toll free) 1-610-667-7706 e-mail: info@sbtklaw.com COMPUCREDIT CORP: Pomerantz Files Securities Fraud Suit in Ga. -------------------------------------------------------------- Pomerantz Haudek Block Grossman & Gross LLP filed a class action complaint in the United States District Court, Northern District of Georgia, against CompuCredit Corporation and certain of its officers on behalf of purchasers of the common stock of the Company between November 6, 2006, and June 9, 2008. The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5. CompuCredit markets credit cards to underserved or "un-banked" consumers and also engages in debt collection services. It is alleged that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results, including: (a) touted the Company's consumer friendly marketing practices and the growth of its credit card business; (b) portrayed the Company's marketing and collection practices as being fully compliant with the law; and (c) to the extent they disclosed any investigations by regulators, they assured the public that the Company was addressing the regulators' concerns and that the outcome would not be material to the Company's financial condition. According to the Complaint, the Company's true state of affairs began to be revealed when on June 10, 2008, The Wall Street Journal reported that, "Federal regulators are expected to seek more than $100 million in fines and restitution Tuesday against CompuCredit Corp. and affiliate banks related to credit-card- marketing and debt-collection practices, people familiar with the matter said." The same day, the FDIC and FTC announced enforcement actions against the Company and affiliated banks seeking restitution to consumers in the form of credits for certain fees and charges of over $200 million. The FDIC detailed egregious misconduct. For example, the Company's solicitations to consumers created the impression they were getting a card with a $300 credit limit. However, CompuCredit concealed that consumers would be immediately charged with upfront fees of as much as $185, so that the credit would be reduced to $115 before a consumer ever used the card. The market was shocked by the previously undisclosed level of exposure from the federal investigation. The potential fines could wipe out the Company's "managed" earnings as reported throughout the Class Period. On this news, CompuCredit's stock dropped $2.49 per share to close at $6.30 per share on June 10, 2008, a one-day decline of 28% on extremely high volume, resulting in damage to Class members who had purchased at prices inflated by defendants' materially false and misleading statements. For more information, contact: Teresa Webb, Esq. (tlwebb@pomlaw.com) Pomerantz Haudek Block Grossman & Gross LLP 100 Park Avenue New York, NY 10017-5516 Phone: 888-476-6529 INYX INC: Brualdi Files Securities Fraud Lawsuit in New York ------------------------------------------------------------ The Brualdi Law Firm, P.C., disclosed that a lawsuit has been commenced in the United States District Court for the Southern District of New York on behalf of purchasers of Inyx, Inc. (Pink Sheets:IYXI) common stock during the period between March 31, 2005-July 2, 2007, for violations of the federal securities laws. The complaint alleges that, during the Class Period, defendants made numerous statements about the Company's financial performance in both its public statements and in the filings that it made with the Securities and Exchange Commission. As alleged in the complaint, these statements were materially false and misleading because they failed to disclose: (i) that the Company was materially overstating its assets and revenues by creating false sales invoices, as these invoices were created before the items were billable and had not actually been issued to customers; (ii) that the Company was not following its publicly stated accounting policies; and (iii) as a result of the foregoing, the Company's financial statements were not prepared in accordance with Generally Accepted Accounting Principles and were therefore materially false and misleading. On July 2, 2007, after the market opened for trading, news services carried a report that Inyx had filed for Chapter 11 protection in the U.S. Bankruptcy Court in Delaware. In response to this announcement, the price of Inyx common stock plummeted, falling from $2.44 per share on June 29, 2007, to a low as $0.30 per share in intra-day trading on July 2, 2007, on extremely heavy trading volume of more than 7.7 million shares. Interested parties may move the court no later than October 20, 2008, for lead plaintiff appointment. For more information, contact: Sue Lee, Esq. (slee@brualdilawfirm.com) The Brualdi Law Firm, P.C. 29 Broadway, Suite 2400 New York, NY 10006 Phone: 877-495-1187 (toll free) 212-952-0602 Web site: http://www.brualdilawfirm.com/ PERINI CORP: Coughlin Stoia Files Securities Fraud Suit in Mass. ---------------------------------------------------------------- Coughlin Stoia Geller Rudman & Robbins LLP announced that a class action has been commenced in the United States District Court for the District of Massachusetts on behalf of purchasers of Perini Corp. common stock during the period between Nov. 2, 2006, and Jan. 17, 2008. The complaint charges Perini and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Perini and its subsidiaries offer general contracting, construction management, and design-build services to private clients and public agencies worldwide. According to the complaint, during the Class Period, defendants issued materially false and misleading statements that misrepresented and failed to disclose: (a) that the developer of Perini's Las Vegas, Nevada projects, including the Cosmopolitan Resort & Casino Project, was experiencing financial problems because it failed to secure financing for the entire project and was dependent upon raising the remainder of the financing from the expected sale of residential units. However, the proceeds from the residential unit sales were based on unrealistic and aggressive prices at a time when the condo market in Las Vegas, Nevada was extremely weak; (b) that the Company's Las Vegas projects were being delayed, and could possibly be halted; (c) that the developer was in risk of defaulting on its construction loan; (d) that the Company's future revenue and profit was dependent upon the Las Vegas projects since the projects consisted of approximately 20% of its backlog; and (e) as a result of the foregoing, the Company's ability to maintain its profit margins was in serious doubt. Then, on Jan. 17, 2008, the Company issued a press release announcing that Deutsche Bank "delivered a notice of loan default to the developer of the Cosmopolitan Resort and Casino project under construction in Las Vegas, Nevada." In response to this announcement, shares of the Company's common stock fell $10.05 per share, or 27%, to close at $27.65 per share, on heavy trading volume. Plaintiff seeks to recover damages on behalf of all purchasers of Perini 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 publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *