/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/101020.mbx C L A S S A C T I O N R E P O R T E R Wednesday, October 20, 2010, Vol. 12, No. 207 Headlines ALBERTO-CULVER: D&Os Sued Over $3.7 Billion Sale to Unilever AUDIOVOX CORP: Suits Over Cell Phone Radiation Remain Pending AUTHENTIDATE HOLDING: Defends Second Amended Complaint in NY BRIGGS & STRATTON: Recalls 500 Craftsman Riding Mowers CCA INDUSTRIES: Court Gives Final Nod to "Wally" Suit Settlement CHICAGO CARRIAGE: Sued for Retaining 5% of Fares Made on Credit GATEWAY INC: Sued Over Defective LX6810 Desktop Computer INDYMAC BANK: Accused of Breaching Option ARM Mortgage Contracts LLOYDS TSB: To Face U.S. Class Action Over HBOS Takeover PERIGEUM DEVELOPMENT: Recalls 500 Revl Carbon Bicycle Brakes RYOBI TECHNOLOGIES: Recalls 445,000 HP 1802M Cordless Power Drills UK: New FSA Redress Powers Could Spark Platform "Class Actions" UNITED STATES: "Don't Ask, Don't Tell" Ruling Questioned UNITED STATES: Nears Settlement in Native American Farmers' Suit WASHINGTON MUTUAL: Suit Over Lending Granted Class-Action Status WILLMOTT FORESTS: Faces Class Action Lawsuit From Investors YUM! BRANDS: Continues to Defend "Chhibber" in Orange County YUM! BRANDS: Defends Wage and Hour Suits in California YUM! BRANDS: Plaintiff's Appeal of Ruling in KFC Suit Ongoing YUM! BRANDS: "Rosales" Suit in Orange County Remains Stayed YUM! BRANDS: Awaits Class Certification Ruling in "Hines" Suit * Securities Class Action Suits Decreasing, Advisen Report Says ********* ALBERTO-CULVER: D&Os Sued Over $3.7 Billion Sale to Unilever ------------------------------------------------------------ Dolores Joyce, individually and on behalf of all others similarly situated v. Leornard H. Lavin, et al., Case No. 2010-CH-44626 (Ill. Cir. Ct., Cook Cty. October 13, 2010), seeks to enjoin the proposed acquisition of the publicly owned shares of Alberto- Culver Company common stock by Unilever N.V., Unilever PLC, Conopco, Inc. and ACE Merger, Inc., for $37.50 per share in an all cash transaction valued at approximately $3.7 billion. Specifically, Ms. Joyce says certain of Alberto-Culver's officers and directors breached their fiduciary duties to the Company's public shareholders when they failed to secure the best price obtainable for the benefit of the Company's shareholders. In addition to the grossly inadequate consideration, Ms. Joyce states the offer was also arrived at through a flawed sales process. The individual defendants include: 1) Leonard H. Lavin, founder, Chairman Emeritus and director 2) Carol Lavin Bernick, Executive Chairman and director 3) V. James Marino, President, CEO and director 4) King W. Harris, director 5) Robert H. Rock, director 6) Thomas A. Dattilo, director 7) Sam J. Susser, director 8) James R. Edgar, director 9) James G. Brocksmith, Jr., director 10) George L. Fotiades, director The suit alleges that Alberto-Culver's Board of Directors had substantial leverage to negotiate a significant premium in an all- cash sale of the Company, but elected to negotiate solely with Unilever to sell the Company without even contacting any other potential buyers. The Complaint states that the individual defendants further breached their fiduciary duties by agreeing to certain deal protection devices designed to make the proposed transaction a virtual fait d'accompli and deter the emergence of any competing bidders, including: i) a termination fee of $125 million; ii) a strict "no shop" provision that prevents Alberto-Culver from communicating with or providing Company information to competing bidders; and iii) a matching rights provision. In addition, it is anticipated that the Company's key executives, including President and CEO V. James Marino, will secure lucrative continued employment with the surviving company, according to the Complaint. Moreover, concurrently with the execution of the Merger Agreement, certain of the individual defendants including Leonard H. Lavin and Carol Lavin Bernick who collectively own over 13% of the Company's stock, entered into a Stockholder Agreement that irrevocably binds them to vote in favor of the proposed transaction. The suit also asserts claims against Unilever and Alberto-Culver for knowingly aiding and abetting the individual defendants' breach of their fiduciary duties. The Plaintiff is represented by: Mark D. Belongia, Esq. Harry O. Channon, Esq. BELONGA, SHAPIRO & FRANKLIN, LLP 20 S. Clark Street, Suite 300 Telephone: (312) 662-1030 - and - Nadeem Faruqi, Esq. David H. Leventhal, Esq. Juan E. Monteverde, Esq. FARUQI & FARUQI, LLP 369 Lexington Avenue, 10th Floor New York, NY 10017 Telephone: (212) 983-9330 - and - James S. Notis, Esq. Charles A. Germershausen GARDY & NOTIS, LLP 560 Sylvan Avenue Englewood Cliffs, N.J. 07632 Telephone: (201) 567-7377 AUDIOVOX CORP: Suits Over Cell Phone Radiation Remain Pending ------------------------------------------------------------- Certain consolidated class actions transferred to a Multi-District Litigation Panel of the U.S. District Court of the District of Maryland against Audiovox Corp. and other suppliers, manufacturers and distributors of hand-held wireless telephones are still pending. The suits generally allege damages relating to exposure to radio frequency radiation from hand-held wireless telephones. No additional information was disclosed in the company's Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Aug. 31, 2010. Audiovox Corp. -- http://www.audiovox.com/-- is an international distributor and value added service provider in the accessory, mobile and consumer electronics industries. AUTHENTIDATE HOLDING: Defends Second Amended Complaint in NY ------------------------------------------------------------ Authentidate Holding Corp. continues to defend a second amended complaint in the U.S. District Court for the Southern District of New York, according to the company's Oct. 13, 2010, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended June 30, 2010. Between June and August 2005, six purported shareholder class actions were filed in the United States District Court for the Southern District of New York against the company and certain of its current and former directors and former officers. Plaintiffs in those actions alleged that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Sections 11 and 15 of the Securities Act of 1933. The securities law claims were based on the allegations that the company failed to disclose that its August 2002 agreement with the USPS contained certain performance metrics, and that the USPS could cancel the agreement if it did not meet these metrics; that it did not disclose complete and accurate information as to its performance under, and efforts to renegotiate, the USPS agreement; and that when it did disclose that the USPS might cancel the agreement, the market price of its stock declined. On Oct. 5, 2005 the Court consolidated the class actions under the caption In re Authentidate Holding Corp. Securities Litigation., C.A. No. 05 Civ. 5323 (LTS), and appointed the Illinois State Board of Investment as lead plaintiff under the Private Securities Litigation Reform Act. The plaintiff filed an amended consolidated complaint on January 3, 2006, which asserted the same claims as the prior complaints and also alleged that Authentidate violated the federal securities laws by misrepresenting that it possessed certain patentable technology. On July 14, 2006, the Court dismissed the amended complaint in its entirety; certain claims were dismissed with prejudice and plaintiff was given leave to replead those claims which were not dismissed with prejudice. In August 2006, plaintiff filed a second amended complaint, which did not assert any claims relating to the company's patents or under the Securities Act of 1933, but which otherwise was substantially similar to the prior complaint. The second amended complaint sought unspecified monetary damages. The company moved to dismiss the second amended complaint on November 13, 2006. On March 26, 2009, the S.D.N.Y. dismissed, with prejudice, the second amended complaint. The lead plaintiff filed an appeal and a hearing in the case was held before the U.S. Court of Appeals for the Second Circuit on Feb. 3, 2010. On March 16, 2010, the U.S. Court of Appeals for the Second Circuit issued an order affirming in part and vacating and remanding in part the March 2009 decision of the S.D.N.Y. which had granted the company's motion to dismiss these claims with prejudice. Authentidate Holding Corp. -- http://www.authentidate.com/-- is a worldwide provider of secure Health Information Exchange and workflow management services. The Company's software and web- based services enable healthcare organizations and other enterprises to increase revenues, improve productivity and reduce costs by eliminating paper and manual work steps from clinical, administrative and other processes and enhancing compliance with regulatory requirements. The web-based services are delivered as Software as a Service (Saas) to customers. These solutions incorporate rules-based electronic forms, intelligent routing, transaction management, electronic signatures, identity credentialing, content authentication and automated audit trails. Both web and fax based communications are integrated into automated and trusted workflow solutions. The company has offices in the United States and Germany. In the United States, Authentidate offers its patent pending content authentication technology in the form of the United States Postal Service(R) Electronic Postmark(R) (EPM). BRIGGS & STRATTON: Recalls 500 Craftsman Riding Mowers ------------------------------------------------------ The U.S. Consumer Product Safety Commission, in cooperation with Briggs & Stratton Power Products Group, LLC, of Milwaukee, Wis., announced a voluntary recall of about 500 Craftsman riding mowers. Consumers should stop using recalled products immediately unless otherwise instructed. These riding mowers came to consumers with the side discharge chute not fully secured to the mower. Bolts can be forcefully discharged from mower if not properly tightened, posing an injury hazard to consumers. The firm received one report of a bolt that discharged forcefully, breaking a window. This recall involves Craftman riding mower with model number 107.28034 and serial numbers listed below. The rear engine mounted riding mower is black. The model and serial numbers can be found on the data tag on the back of the riding mower. Serial numbers included in this recall -------------------------------------- 2014033403 through 2014034552 2014082112 through 2014082861 2014149995 through 2014151266 2014346290 through 2014346803 Pictures of the recalled products are available at: http://www.cpsc.gov/cpscpub/prerel/prhtml11/11704.html The recalled products were manufactured in USA and sold through Sears stores nationwide between February 2010 and May 2010 for about $1,400. Consumers should immediately stop using these recalled riding mowers and contact Sears for a free inspection and repair. Sears is sending consumers letters with information on scheduling an inspection and repair. For additional information, contact Sears at (800) 859-7026 between 8:00 a.m. and 10:00 p.m. Eastern Time, Monday through Friday, or visit the firm's Web site at http://www.sears.com/ CCA INDUSTRIES: Court Gives Final Nod to "Wally" Suit Settlement ---------------------------------------------------------------- The Superior Court for the State of California, County of Los Angeles, Central Civil West, on Sept. 28, 2010, entered a Final Order and Judgment in the case Denise Wally and Lauren Fleischer, et al. vs. CCA Industries, Inc. The Final Order reconfirms the Preliminary Approval order dated June 9, 2010, which, subject to the Court's final approval, provided for the deposit of $2,500,000 into a common fund to be dispersed as per provisions approved by the Court in the final Order of Settlement, according to the company's Oct 13, 2010, Form 8-K filing with the U.S. Securities and Exchange Commission. The suit was originally filed on Sept. 29, 2009, alleging false and misleading advertisement of the company's dietary supplement. The action was brought seeking monetary and equitable remedies. CCA Industries, Inc., manufactures and distributes health and beauty aid products. CCA has several wholly-owned subsidiaries, CCA Cosmetics, Inc., CCA Labs, Inc., and Berdell, Inc, all of which are currently inactive. CCA has two active wholly-owned subsidiaries, CCA Online Industries, Inc., and CCA IND., S.A. DE C.V., a Variable Capital Corporation organized pursuant to the laws of Mexico. CHICAGO CARRIAGE: Sued for Retaining 5% of Fares Made on Credit --------------------------------------------------------------- Benjamin Durueke, individually and on behalf of others similarly situated v. Chicago Carriage Cab Co. and Royal 3 CCC Chicago Tax Association, Inc., Case No. 2010-CH-44770 (Ill. Cir. Ct., Cook Cty. October 14, 2010), accuses the taxicab operators of turning over to their taxicab drivers only 95% or less of amounts shown on receipts for payments made by passengers on credit, which includes payments through credit cards, debit cards, prepaid cards, and company charge cards. Mr. Durueke says that despite demands made to the defendants to turn over 100% of the fares or gratuities made by credit to their taxicab drivers, defendants have refused. Mr. Durueke states that no agreement exists authorizing defendants to take any part of the money paid by credit to the taxicab drivers as either fares or gratuities, and that their only obligation is to pay the agreed rental amounts specified in the lease when they rent the taxicabs. The Plaintiff is represented by: Robert A. Holstein, Esq. HOLSTEIN LAW OFFICES, LLC 19 S. LaSalle Street, Suite 1500 Chicago, IL 60603 Telephone: (312) 906-8000 - and - Clayton P. Voegtle, Esq. 14047 W. Petronella Dr., Suite 202A Libertyville, IL 60048 Telephone: (847) 918-9840 GATEWAY INC: Sued Over Defective LX6810 Desktop Computer -------------------------------------------------------- Courthouse News Service reports that a class action claims the Gateway LX6810 desktop computer overheats and crashes under normal conditions, in Los Angeles Federal Court. A copy of the Complaint in Kelly, et al. v. Gateway, Inc., et al. Case No. 10-cv-01563 (C.D. Calif.), is available at: http://www.courthousenews.com/2010/10/15/Gateway.pdf The Plaintiffs are represented by: Daniel E. Park, Esq. Shahram A. Shayesteh, Esq. Edward Kang, Esq. Lisa M. Lawrence, Esq. Alice Wang, Esq. LURIE & PARK 16501 Ventura Blvd., Suite 620 Encino, CA 91423 Telephone: (818) 949-6000 INDYMAC BANK: Accused of Breaching Option ARM Mortgage Contracts ---------------------------------------------------------------- Courthouse News Service reports that a class action claims that IndyMac Bank and its successor, One West Bank Group, breached "Option ARM" mortgage contracts, and made principal balances increase,by applying payments to escrow accounts before principal and interest. By violating the explicit terms of its contracts, the banks made the mortgage loans negatively amortize, increasing the principal balance, the class claims. They seek an injunction and damages for breach of contract, unjust enrichment, and violations of business and professional codes and consumer laws. The Plaintiffs are represented by: Richard Kellner, Esq. KABATECK BROWN KELLNER, LLP Engine Company No. 28 Building 644 South Figueroa Street Los Angeles, CA 90017 Telephone: 213-217-5000 It's the second class action against IndyMac and One West last week in L.A. Superior Court. LLOYDS TSB: To Face U.S. Class Action Over HBOS Takeover -------------------------------------------------------- Jane Bradley, writing for The Scotsman, reports shareholders fighting for compensation for the takeover of HBOS by Lloyds TSB have appointed lawyers in the United States to launch a class action against the bank through the American courts. A court case is expected to be lodged by early next year, through which US shareholders will attempt to claw back the money they believe they lost as a result of the bank's alleged failure to fully describe financial problems experienced by HBOS ahead of the merger which created Lloyds Banking Group. Led by campaign group Lloyds Action Now, shareholders claim they were denied the proper information they needed to vote on the matter and will argue the bank did not allow them an opportunity to sell their shares before the vote. The group has already begun legal action in the UK, through the civil courts, where it is currently awaiting a decision from the bank as to whether it will agree to a pre-court settlement known as mediation. If mediation does not take place, the case will proceed to court. It is expected the US case will be opened in Kentucky where there are a large number of Lloyds shareholders, although Kentucky lawyer Robert Sparks, who has been appointed to handle the case alongside Harry Rankin, said it seemed "destined" to be heard in New York, where "judges are highly qualified in securities litigation". LAN has also sent a delegation to the offices of Mary Shapiro, chair of the Securities Exchange Commission (SEC), and New York Attorney General Andrew Cuomo, to brief them on the case. London-based barrister Johan du Toit, leader of the delegation, said: "While this is a civil case there could be implications for the directors of Lloyds who did not make a proper disclosure of the facts." Claimants say Lloyds directors and the Treasury deliberately failed to disclose the extent of the GBP25.4 billion emergency funding to HBOS in order to keep it afloat until the merger could be approved. This, they claim, was a breach of SEC regulations in the US and the Financial Services and Securities Act in the UK. PERIGEUM DEVELOPMENT: Recalls 500 Revl Carbon Bicycle Brakes ------------------------------------------------------------ The U.S. Consumer Product Safety Commission, in cooperation with Perigeum Development Inc., dba The Hive, of Petaluma, Calif., announced a voluntary recall of about 500 Revl carbon bicycle brakes. Consumers should stop using recalled products immediately unless otherwise instructed. The cable clamping area of the bicycle brakes can crack over time, causing the brakes to fail. This could pose a fall or crash hazard to the cyclist. No injuries or incidents have been reported. The recall involves black Revl carbon road bicycle brakes with date codes 41B, 44B, 45B, 53B, 13C and 16C printed on the underside of the carbon brake arms. "Revl" is printed on the brake. Pictures of the recalled products are available at: http://www.cpsc.gov/cpscpub/prerel/prhtml11/11010.html The recalled products were manufactured in Taiwan and sold through Bicycle specialty stores nationwide from September 2009 through August 2010 for about $390 per set. Consumers should stop using their bicycles with these recalled brakes and contact The Hive for replacement parts and instruction to repair their brakes or contact their retailer to perform the repair free of charge. For additional information, contact The Hive at (800) 801-9936 between 9:00 a.m. and 5:00 p.m., Pacific Time, Monday through Friday or visit the firm's Web site at http://www.bythehive.com/recall/ RYOBI TECHNOLOGIES: Recalls 445,000 HP 1802M Cordless Power Drills ------------------------------------------------------------------ The U.S. Consumer Product Safety Commission, in cooperation with Ryobi Technologies Inc., of Anderson, S.C., announced a voluntary recall of about 445,000 Ryobi Model HP 1802M Cordless Power Drills. Consumers should stop using recalled products immediately unless otherwise instructed. The switch on the cordless drill can overheat, posing a fire and burn hazard to consumers. Ryobi has received 47 reports of the drills overheating, smoking, melting or catching fire, including 12 reports of property damage to homes or vehicles. Two of the incidents involved minor burns from touching an overheated switch. This recall involves the Ryobi Model HP 1802M cordless drill is powered by an 18 volt rechargeable NiCad battery. The drills are blue and black in color with "Ryobi" appearing in red and white on the left side. The model number can be found on a white label on the right side of the drill. Pictures of the recalled products are available at: http://www.cpsc.gov/cpscpub/prerel/prhtml11/11009.html The recalled products were manufactured in China and sold through Home Depot from January 2001 to July 2003 for about $100. Consumers should immediately stop using the recalled drill, remove the rechargeable battery and contact Ryobi to receive a free replacement drill. For additional information, contact Ryobi Customer Service at (800) 597-9624 between 10:00 a.m. and 7:00 p.m., Eastern Time, Monday through Friday or visit the firm's Web site at http://www.ryobitools.com/ UK: New FSA Redress Powers Could Spark Platform "Class Actions" --------------------------------------------------------------- Will Roberts, writing for IFAonline, reports new FSA consumer redress powers could have "catastrophic" implications for advisers who have not conducted proper platforms due diligence, warns Capita Financial Software. New FSA powers, which came into force this week, require businesses to set up collective redress schemes where the regulator sees evidence of widespread failings. But Capita Financial Software business development director William Watling says this raises the specter of class action lawsuits being issued by clients against their advisers' choice of platform. "If a client proved they had been detrimentally impacted by an adviser's choice of platform -- for example, they could have got certain funds or wrappers cheaper elsewhere -- that could potentially mean any client on the same platform impacted in the same way has a right to collective redress," he says. "I am concerned by this and think it is an important question to be raised. If you have hundreds of clients filing class actions, this could be catastrophic." Mr. Watling says the regulator's new powers could also have a significant impact on advisers using just one platform. "If there is one market where IFAs do things in one way, it is the wrap and platform space," he says. The FSA recently indicated advisers can still label themselves as independent despite using just a single platform as long as their clients are all of a similar kind. AT8 director Mark Thelwell says the FSA's new redress powers -- part of April's Financial Services Act 2010 -- could potentially have significant ramifications but are only likely to be used in extreme cases. "There would have to be widespread evidence of people failing to apply principles in the client interest for these powers to be invoked, requiring some high hurdles for the FSA to go through," he says. "They certainly have the armory to hand but they would likely only use it in extreme circumstances." But he adds the new powers will ramp up the pressure on advisers to conduct rigorous due diligence. "These powers will still be a threat in the background so advisers need to make sure they go through the proper processes and, if this hasn't been done recently, then this needs to be revisited." He also suggests advisers will find it difficult to use just one platform without falling foul of the FSA's rigid guidelines. "In reality, when you listen to all of the FSA criteria it is difficult to come up with a client segmentation strategy so narrowly defined as to allow all clients to sit on one platform." UNITED STATES: "Don't Ask, Don't Tell" Ruling Questioned -------------------------------------------------------- David S. Cloud and David Savage, writing for The Los Angeles Times, report that legal scholars on Wednesday questioned whether a federal judge in Riverside, California, can prohibit the entire armed services from forcing out openly gay service members, and the Obama administration scrambled to decide how to respond to the sweeping ruling. The Justice Department is expected to appeal Judge Virginia Phillips' order overturning "don't ask, don't tell" and halting all Defense Department proceedings aimed at discharging gay and lesbian personnel. Last month, government lawyers cited several legal opinions in a brief that warned the judge against issuing an order that went beyond the handful of plaintiffs who had sued in her court. President Obama supports allowing gays to serve, as does Defense Secretary Robert M. Gates. But they have commissioned a study on how troops feel and on how to integrate gays and lesbians into the military. Mr. Gates told reporters traveling with him to Brussels on Wednesday that Congress should decide the question, the Associated Press reported -- and only after the Pentagon task force completed its study, scheduled for Dec. 1. "I feel strongly this is an action that needs to be taken by the Congress and that it is an action that requires careful preparation, and a lot of training," Mr. Gates said. "It has enormous consequences for our troops." If the administration appeals, most legal experts expect the U.S. 9th Circuit Court of Appeals in San Francisco or the Supreme Court to lift Phillips' order while legal proceedings continue. Vikram Amar, a UC Davis law professor, agreed that the judge's authority extended only to the plaintiffs, not to the entire nation. "The 'don't ask, don't tell' case was not certified as a class action," Mr. Amar said. Most federal appellate courts have said that a judge cannot issue a ruling that goes well beyond the parties who sued. Others disagreed. USC law professor David Cruz said Judge Phillips' ruling in favor of the Log Cabin Republicans, a gay rights group, determined that the policy was unconstitutional on its face. In such a suit, plaintiffs do not argue that the measure is unfair to them, but that it is unconstitutional for all. Once a judge declares the entire policy unconstitutional, "she has the authority to issue a ruling binding all the defendants," Mr. Cruz said, which in this instance is the U.S. military. White House spokesman Robert Gibbs told reporters Wednesday, "The president believes that ['don't ask, don't tell'] should end. We have to figure out an orderly way for it to end." Mr. Gibbs referred to the Justice Department questions on whether the administration would appeal. The department had no comment. At a public appearance in the Rose Garden, President Obama ignored a question shouted by a reporter about whether he would allow the judge's ruling to stand. President Obama said in January that he would work with Congress on repealing the law, but a Senate test vote failed last month. It remains unclear whether Democrats will bring up the measure in a lame-duck session scheduled after next month's election. Even lawyers who favor repeal acknowledged that the ruling might not stand for long. The litigation on the law's constitutionality could go on for years, said Aaron Tax, legal director for Servicemembers Legal Defense Network, an organization that represents gay and lesbian military personnel. "We're thrilled by her ruling, but we recognize that it was very broad," Mr. Tax said. "It's likely to be quickly taken up by the 9th Circuit Court of Appeals and it may well be reversed." On Tuesday, Judge Phillips ordered the Defense Department "to immediately suspend and discontinue any investigation, or discharge, separation or other proceeding that may have been commenced" under the 17-year-old policy, which originally was intended as a reform. "Don't ask, don't tell" allows gay service members to serve as long as they do not disclose their sexual orientation. More than 13,000 people have been removed from the military under "don't ask, don't tell," and investigations of service members believed to be gay or lesbian have continued. Pentagon officials said Wednesday they had not received any guidance on whether to continue with pending cases, although its lawyers were studying the issue. One senior military official said that he had heard opposing views from two military lawyers -- one arguing that Judge Phillips' ruling applied only in the Central District of California and another contending that the opinion overturned the policy for the entire armed forces unless a higher court ruling supersedes it. Because of that uncertainty, Mr. Tax said his organization was still advising service members not to disclose that they are gays or lesbians. Although the Pentagon tracks and signs off on decisions to discharge service members under the policy, the process is decentralized, beginning at the unit level, with an investigation and a recommendation to a unit's commanding officer. The need for legal guidance was clear Wednesday when Maj. Gen. John Campbell, a senior U.S. commander in Afghanistan, said most soldiers there were unaware of Judge Phillips' ruling. "Over here, probably none of them even know a judge said that," he said in a video news conference with Pentagon reporters. He added that soldiers "follow the law," and "if the law is changed they will abide by the law." The Pentagon task force charged with examining the issue is "well along" in formulating recommendations, and the ruling is not expected to affect its work, another senior military officer said. The task force found deep resistance to the idea of repealing the policy in some elements of the armed services, especially within the combat units, an officer familiar with the findings said. But the surveys also have found segments of the military that were not overly worried about allowing gays and lesbians to serve, the officer said. UNITED STATES: Nears Settlement in Native American Farmers' Suit ---------------------------------------------------------------- Mike Scarcella, writing for The National Law Journal, reports the Justice Department is nearing a comprehensive class settlement with a class of Native American farmers who filed a discrimination suit against the federal government in 1999. Lawyers for the plaintiffs and DOJ attorneys met for a status conference this week in Washington federal district court. A lead plaintiffs' attorney, Joseph Sellers of Washington's Cohen Milstein Sellers & Toll, said a settlement is close. Neither side in the dispute discussed the terms of the proposed settlement in court and Mr. Sellers declined to provide specifics about the deal-in-progress after the hearing. He said the settlement, which could impact tens of thousands of farmers, would not require congressional authorization. The suit against the U.S. Department of Agriculture was filed in 1999 in the U.S. District Court for the District of Columbia. An economic expert for the plaintiffs said in court records filed in December 2009 that loan shortfalls meant Native American farmers were operating with $2.25 billion less in credit between 1981 and 2007. The expert calculated the economic loss involved in these loans to between $608 and $776 million in that same period. In court papers filed in the case in July, the lawyers for the opposing sides -- including Jenner & Block partner Paul Smith and Anurag Varma of Patton Boggs for the plaintiffs -- said the parties have been "negotiating intensively" over numerous meeting and phone calls. The attorneys said in the joint status report that "given the complexity of this nationwide class action involving both injunctive and monetary claims, the process has moved more slowly than we had hoped." Mr. Sellers said Wednesday that Assistant Attorney General Tony West of the Civil Division has actively participated in the negotiations. Civil Division lawyer Joshua Gardner, who works in the Federal Programs Branch, said in court that DOJ has expedited review of the settlement, which is awaiting approval by Acting Deputy Attorney General Gary Grindler. "We're all trying to move the ball forward," Gardner said. He said there is a "mutual interest" in approving the settlement. Judge Emmet Sullivan of the U.S. District Court for the District of Columbia set a follow-up hearing for October 19. WASHINGTON MUTUAL: Suit Over Lending Granted Class-Action Status ---------------------------------------------------------------- Karen Gullo, writing for Bloomberg News, reports investors suing Washington Mutual Inc., the former owner of the biggest U.S. bank to fail, won certification as a class-action case of their suit alleging shoddy lending practices. Shareholders who lost money on stock purchased from October 2005 to July 2008 can proceed with claims under a single lawsuit, U.S. District Judge Marsha Pechman in Seattle ruled Tuesday, according to court documents. The judge appointed the New York-based law firm Bernstein Litowitz Berger & Grossmann to lead the plaintiffs' case. The lawsuit consolidates more than 20 cases filed against Washington Mutual that claim the bank secretly lowered lending standards, artificially inflated home-price appraisals and failed to disclose its deteriorating financial condition when the loans began to fail. John Wolfe, an attorney representing Washington Mutual defendants, didn't immediately return a voice-mail message seeking comment. The named plaintiffs in the case include Ontario Teachers' Pension Plan Board, the largest single-profession pension plan in Canada, and four other pension groups, according to court documents. They seek to represent tens of thousands of shareholders who lost money on three types of preferred stock purchased between October 2005 and July 2008 and certain securities offered by the bank in 2006 and 2007. The shareholders argued the case should be granted class-action status because their claims are typical of what other investors experienced and are based on common legal issues. WaMu filed for bankruptcy Sept. 26, 2008, the day after its banking unit was taken over by regulators and sold to JPMorgan Chase for $1.9 billion. Before it failed, Washington Mutual Bank had more than 2,200 branches and $188 billion in deposits. Judge Pechman ruled Sept. 28 that a separate federal shareholder lawsuit in Seattle claiming the bank misled purchasers of $10.8 billion in mortgage-backed securities could proceed. WILLMOTT FORESTS: Faces Class Action Lawsuit From Investors ----------------------------------------------------------- Leonie Wood, writing for The Sydney Morning Herald, reports investors who sank millions of dollars into tree plantation schemes run by the failed Willmott Forests group are considering filing a class action alleging the company misled and deceived them for years about its financial position. The proposed action, which is still some way from being filed, is being managed by Macpherson+Kelley lawyers, the firm responsible for class actions against Great Southern and Timbercorp in the Victorian Supreme Court. Ron Willemson, the principal of Macpherson+Kelley, said growers would seek damages from the responsible entity and directors. The class action would encompass Willmott grower/investors who either paid cash or borrowed from the company or from its agent, the Commonwealth Bank, and bought tree plantation lots from early 2008. Willmott sank into receivership in September when Commonwealth Bank and St George Bank, which are owed $122 million, appointed Bryan Webster and Mark Korda of KordaMentha to take control. Willmott's board appointed a sole practitioner, Tom Fernandez of Melbourne's eastern suburbs. That appointment has been challenged by the banks, the Australian Securities and Investments Commission and a faction of grower/investors. The Federal Court judge Ray Finkelstein told Mr. Fernandez's counsel this week that he too was concerned Mr. Fernandez did not have the capacity and resources to deal with what would be a complex administration. The banks want PPB appointed in place of Mr. Fernandez; the judge has floated the idea that the administrator's role could be offered by tender. Justice Finkelstein has reserved his decision. Macpherson+Kelley's Mr. Willemson said the proposed class action would be funded not by a litigation funder but by the grower/investors on a proportionate basis. "We will say there was sufficient deterioration in 2008 that required some sort of disclosure about the risk to be made to investors before they decided to invest in Willmott plantations," he said. "Investors were thinking Willmott was this solid company which had been around for 30 years with a track record of good success, and the message was: there was not much risk associated with this other than the usual agriculture risk." Mr. Willemson said Willmott's annual report indicated the company had used some "adventurous" accounting policies, including the booking of future-year revenues which, he claimed, bolstered profit. Willmott's accounts indicate it received $97 million of growers' funds for investment schemes in the year to June 2008, $67 million in 2009 and $20 million in 2010. YUM! BRANDS: Continues to Defend "Chhibber" in Orange County ------------------------------------------------------------ Taco Bell Corp. continues to defend a consolidated suit captioned Rajeev Chhibber vs. Taco Bell Corp., according to YUM! Brands, Inc.'s Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 4, 2010. Taco Bell is a concept owned and operated by YUM! Brands. On Aug. 4, 2006, a putative class action lawsuit against Taco Bell was filed in Orange County Superior Court. On Aug. 7, 2006, another putative class action lawsuit styled Marina Puchalski v. Taco Bell Corp. was filed in San Diego County Superior Court. Both lawsuits were filed by a Taco Bell Restaurant General Manager purporting to represent all current and former RGMs who worked at corporate-owned restaurants in California since August 2002. The lawsuits allege violations of California's wage and hour laws involving unpaid overtime and meal period violations and seek unspecified amounts in damages and penalties. The cases were consolidated in San Diego County as of Sept. 7, 2006. Based on plaintiffs' revised class definition in their class certification motion, Taco Bell removed the case to federal court in San Diego on Aug. 29, 2008. On March 17, 2009, the court granted plaintiffs' motion to remand. On Jan. 29, 2010, the court granted the plaintiffs' class certification motion with respect to the unpaid overtime claims of RGMs and Market Training Managers but denied class certification on the meal period claims. The parties participated in mediation on May 26, 2010, without reaching resolution. YUM! Brands, Inc. -- http://www.yum.com/-- is a quick service restaurant (QSR) with over 35,000 units in more than 100 countries and territories. Through the five concepts of KFC, Pizza Hut, Taco Bell, LJS and A&W (the Concepts), the company develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of food items. In all five of its Concepts, the company either operates units or they are operated by independent franchisees or licensees under the terms of franchise or license agreements. In addition, the company owns non-controlling interests in Unconsolidated Affiliates who operate similar to franchisees. YUM! BRANDS: Defends Wage and Hour Suits in California ------------------------------------------------------ Taco Bell Corp. continues to defend the matter In Re Taco Bell Wage and Hour Actions pending in the U.S. District Court for the Eastern District of California, according to YUM! Brands, Inc.'s Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 4, 2010. Taco Bell is a concept owned and operated by YUM! Brands. On Sept. 10, 2007, a putative class action against Taco Bell Corp., the company and other related entities styled Sandrika Medlock v. Taco Bell Corp., was filed in U.S. District Court, Eastern District, Fresno, California. The case was filed on behalf of all hourly employees who have worked at corporate-owned restaurants in California since September 2003 and alleges numerous violations of California labor laws including unpaid overtime, failure to pay wages on termination, denial of meal and rest breaks, improper wage statements, unpaid business expenses and unfair or unlawful business practices in violation of California Business & Professions Code Section 17200. The company was dismissed from the case without prejudice on Jan. 10, 2008. On April 11, 2008, Lisa Hardiman filed a Private Attorneys General Act complaint in the Superior Court of the State of California, County of Fresno against Taco Bell Corp., the company and other related entities. This lawsuit, styled Lisa Hardiman vs. Taco Bell Corp., et al., was filed on behalf of Hardiman individually and all other aggrieved employees pursuant to PAGA. The complaint seeks penalties for alleged violations of California's Labor Code. On June 25, 2008, Hardiman filed an amended complaint adding class action allegations on behalf of hourly employees in California very similar to the Medlock case, including allegations of unpaid overtime, missed meal and rest periods, improper wage statements, non-payment of wages upon termination, unreimbursed business expenses and unfair or unlawful business practices in violation of California Business & Professions Code Section 17200. On June 16, 2008, a putative class action lawsuit against Taco Bell Corp. and the company, styled Miriam Leyva vs. Taco Bell Corp., et al., was filed in Los Angeles Superior Court. The case was filed on behalf of Leyva and purportedly all other California hourly employees and alleges failure to pay overtime, failure to provide meal and rest periods, failure to pay wages upon discharge, failure to provide itemized wage statements, unfair business practices and wrongful termination and discrimination. The company was dismissed from the case without prejudice on Aug. 20, 2008. On Nov. 5, 2008, a putative class action lawsuit against Taco Bell Corp. and the company styled Loraine Naranjo vs. Taco Bell Corp., et al., was filed in Orange County Superior Court. The case was filed on behalf of Naranjo and purportedly all other California employees and alleges failure to pay overtime, failure to reimburse for business related expenses, improper wage statements, failure to pay accrued vacation wages, failure to pay minimum wage and unfair business practices. The company filed a motion to dismiss on Dec. 15, 2008, which was denied on Jan. 20, 2009. On March 26, 2009, Taco Bell was served with a putative class action lawsuit filed in Orange County Superior Court against Taco Bell and the company styled Endang Widjaja vs. Taco Bell Corp., et al. The case was filed on behalf of Widjaja, a former California hourly assistant manager, and purportedly all other individuals employed in Taco Bell's California restaurants as managers and alleges failure to reimburse for business related expenses, failure to provide rest periods, unfair business practices and conversion. Taco Bell removed the case to federal district court and filed a notice of related case. On June 18, 2009 the case was transferred to the Eastern District of California. On May 19, 2009 the court granted Taco Bell's motion to consolidate the Medlock, Hardiman, Leyva and Naranjo matters, and the consolidated case is styled In Re Taco Bell Wage and Hour Actions. On July 22, 2009, Taco Bell filed a motion to dismiss, stay or consolidate the Widjaja case with the In Re Taco Bell Wage and Hour Actions, and Taco Bell's motion to consolidate was granted on Oct. 19, 2009. The In Re Taco Bell Wage and Hour Actions plaintiffs filed a consolidated complaint on June 29, 2009, and on March 30, 2010 the court approved the parties' stipulation to dismiss YUM from the action. The parties participated in mediation on Aug. 5, 2010 without reaching resolution. Motions regarding class certification are scheduled to be filed by Dec. 30, 2010 and the hearing on any class certification motion has been scheduled for May 9, 2011. YUM! Brands, Inc. -- http://www.yum.com/-- is a quick service restaurant (QSR) with over 35,000 units in more than 100 countries and territories. Through the five concepts of KFC, Pizza Hut, Taco Bell, LJS and A&W (the Concepts), the company develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of food items. In all five of its Concepts, the company either operates units or they are operated by independent franchisees or licensees under the terms of franchise or license agreements. In addition, the company owns non-controlling interests in Unconsolidated Affiliates who operate similar to franchisees. YUM! BRANDS: Plaintiff's Appeal of Ruling in KFC Suit Ongoing ------------------------------------------------------------- The plaintiff's appeal on a ruling that his suit against KFC U.S. Properties, Inc., would not go forward as a class action is ongoing. On Oct. 14, 2008, a putative class action, styled Kenny Archila v. KFC U.S. Properties, Inc., was filed in California state court on behalf of all California hourly employees alleging various California Labor Code violations, including rest and meal break violations, overtime violations, wage statement violations and waiting time penalties. KFC removed the case to the U.S. District Court for the Central District of California on Jan. 7, 2009. On July 7, 2009, the Judge ruled that the case would not go forward as a class action. Plaintiff also sought recovery of civil penalties under the California Private Attorney General Act as a representative of other "aggrieved employees." On Aug. 3, 2009, the Court ruled that the plaintiff could not assert such claims and the case had to proceed as a single plaintiff action. On the eve of the Aug. 18, 2009 trial, the plaintiff stipulated to a dismissal of his individual claims with prejudice but reserved his right to appeal the Court's rulings regarding class and PAGA claims. KFC reserved its right to make any and all challenges to the appeal. On or about Sept. 16, 2009, plaintiff filed a notice of appeal. Plaintiff filed his opening appellate brief on March 31, 2010, KFC filed its opposition brief on May 28, 2010 and plaintiff filed his reply brief on June 25, 2010. No updates were reported in YUM! Brands, Inc.'s Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 4, 2010. YUM! Brands, Inc. -- http://www.yum.com/-- is a quick service restaurant (QSR) with over 35,000 units in more than 100 countries and territories. Through the five concepts of KFC, Pizza Hut, Taco Bell, LJS and A&W (the Concepts), the company develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of food items. In all five of its Concepts, the company either operates units or they are operated by independent franchisees or licensees under the terms of franchise or license agreements. In addition, the company owns non-controlling interests in Unconsolidated Affiliates who operate similar to franchisees. YUM! BRANDS: "Rosales" Suit in Orange County Remains Stayed ----------------------------------------------------------- A putative class action against Taco Bell Corp. styled Marisela Rosales v. Taco Bell Corp. and filed in the Orange County Superior Court, remains stayed. The suit was filed on Sept. 28, 2009. The plaintiff, a former Taco Bell crew member, alleges that Taco Bell failed to timely pay her final wages upon termination, and seeks restitution and late payment penalties on behalf of herself and similarly situated employees. This case, according to the company, appears to be duplicative of the In Re Taco Bell Wage and Hour Actions case. Taco Bell removed the case to federal court on Nov. 5, 2009, and subsequently filed a motion to dismiss, stay or transfer the case to the same district court as the In Re Taco Bell Wage and Hour Actions case. The parties stipulated to remand of the case to Orange County Superior Court on March 18, 2010. Taco Bell's answer or other responsive pleading was due by April 19, 2010. The state court granted Taco Bell's motion to stay the Rosales case on May 28, 2010, but required Taco Bell to give notice to Rosales' counsel of the In Re Taco Bell Wage and Hour Actions mediation. No updates were reported in YUM! Brands, Inc.'s Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 4, 2010. YUM! Brands, Inc. -- http://www.yum.com/-- is a quick service restaurant (QSR) with over 35,000 units in more than 100 countries and territories. Through the five concepts of KFC, Pizza Hut, Taco Bell, LJS and A&W (the Concepts), the company develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of food items. In all five of its Concepts, the company either operates units or they are operated by independent franchisees or licensees under the terms of franchise or license agreements. In addition, the company owns non-controlling interests in Unconsolidated Affiliates who operate similar to franchisees. YUM! BRANDS: Awaits Class Certification Ruling in "Hines" Suit -------------------------------------------------------------- The parties in the matter Domonique Hines v. KFC U.S. Properties, Inc., continue to await the ruling on the plaintiff's motion for class certification, according to YUM! Brands, Inc.'s Oct. 12, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 4, 2010. On Oct. 2, 2009, a putative class action was filed in California state court on behalf of all California hourly employees alleging various California Labor Code violations, including rest and meal break violations, overtime violations, wage statement violations and waiting time penalties. Plaintiff is a current non-managerial KFC restaurant employee represented by the same counsel that filed the suit Kenny Archila v. KFC U.S. Properties, Inc. KFC filed an answer on Oct. 28, 2009, in which it denied plaintiff's claims and allegations. KFC removed the action to the U.S. District Court for the Southern District of California on Oct. 29, 2009. KFC filed a motion to transfer the action to the Central District of California due to the overlapping nature of the claims in this action and the Archila action. Plaintiff filed a motion to remand the action to state court. The District Court denied both motions. Plaintiff filed a motion for class certification on May 20, 2010 and KFC filed a brief in opposition. A hearing on plaintiff's motion was held on Aug. 13, 2010, and the parties are awaiting a ruling. No trial date has been set. YUM! Brands, Inc. -- http://www.yum.com/-- is a quick service restaurant (QSR) with over 35,000 units in more than 100 countries and territories. Through the five concepts of KFC, Pizza Hut, Taco Bell, LJS and A&W (the Concepts), the company develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of food items. In all five of its Concepts, the company either operates units or they are operated by independent franchisees or licensees under the terms of franchise or license agreements. In addition, the company owns non-controlling interests in Unconsolidated Affiliates who operate similar to franchisees. * Securities Class Action Suits Decreasing, Advisen Report Says --------------------------------------------------------------- New securities lawsuits sparked by the credit crisis have all but disappeared, but the pace of securities lawsuit filings in the third quarter continued at elevated credit crisis-like levels, according to a new report from Advisen Ltd, sponsored by ACE. With 284 suits filed in the third quarter, 2010 is on target to surpass the 2008 total of 928 suits filed and will likely draw near to the unprecedented 1,105 new filings in 2009. "With the worst of the credit crisis behind us, 2010 was expected to be a comparatively quiet year for securities litigation," said John W. Molka III, the author of the report. "The year began quietly enough, with 206 suits filed in the first quarter, but the volume of new filings in the second and third quarters has been more typical of the activity we saw in 2008 and 2009." The elevated level of new filings in the second quarter was largely attributable to suits arising from the Deepwater Horizon oil spill. The third quarter, however, had no one event that sparked a large number of suits. Financial services companies and their directors and officers were most frequently named in suits, as was the case throughout the credit crisis, but companies in the information technology and healthcare sectors were close behind. Suits alleging breach of fiduciary duty accounted for over one- third of new filings. These suits, which often are filed in state courts, typically are brought by shareholders of an acquired company claiming that directors and officers sold the company too cheaply. Securities fraud suits, a category defined by Advisen to be comprised principally of suits brought by regulatory and law enforcement agencies, represented 29 percent of the total, while securities class action suits accounted for 20 percent of new filings. Securities class action filings have been decreasing as a percentage of total security lawsuit filings since 2004, but still represent most of the largest settlements: five of the seven largest settlements during the quarter were of securities class action suits. "The credit crisis may have abated, but securities lawyers aren't taking a break," said Dave Bradford, Advisen's Executive Vice President. "They are filing fewer securities class action suits, but more suits alleging breach of fiduciary duty. The pace of mergers and acquisitions should pick up as the economy improves, which probably will lead to even more breach of fiduciary duty suits in the coming year." The report, "Securities Litigation Remains Escalated," sponsored by ACE, can be downloaded for no charge at the Advisen Corner Store: http://corner.advisen.com/reports_topical_Q3_2010_ACE_blurb.html About Advisen Advisen's data, analytics and news offerings are game-changers for 100,000 commercial P&C professionals. For Underwriters, Reinsurers, Brokers and Risk Managers, the resources of Advisen provide productivity and insight into underwriting, marketing, broking and purchasing commercial insurance. Configurable applications allow Advisen to customize each solution and/or craft special offline delivery, too. ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Gracele D. Canilao, Leah Felisilda, Rousel Elaine Fernandez, Joy A. Agravante, Ronald Sy, Christopher Patalinghug, Frauline Abangan and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *