/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
*********
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news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent research,
collectively face billions of dollars in asbestos-related
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*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Copyright 2008. All rights reserved. ISSN 1525-2272.
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