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/raid1/www/Hosts/bankrupt/CAR_Public/110418.mbx C L A S S A C T I O N R E P O R T E R Monday, April 18, 2011, Vol. 13, No. 76 Headlines AECOM: Faces $700MM Class Action Over RiverCity Collapse BABIES "R" US: Aug. 1 Class Action Claim Filing Deadline Set BP PLC: Faces Class Action for Canceling Dividend Payout BUREAU OF COLLECTION: 10th Cir. Reverses "Lucero" Suit Dismissal CISCO SYSTEMS: May 30 Class Action Lead Plaintiff Deadline Set CLARUS MARKETING: Accused of Defrauding Online Shoppers CONSUMER PRIVACY CASES: Calif. App. Ct. Affirms Copy Charges EI DUPONT: Cristal Dismissed as Defendant in Haley Paint Suit GILAT SATELLITE: Merger-Related Suit Pending in Israeli Court HYUNDAI CAPITAL: Class Action Poses Challenge to Customers INSPIRE PHARMA: Being Sold to Merck for Too Little, Suit Claims LORAL SPACE: 2nd Cir. Says Former CEO Did Not Omit Material Facts MECHEL OAO: Awaits Ruling on Dismissal Plea in "Frederick" Suit METROPOLITAN PROPERTY: Back Doctors Suit Stays in Federal Court MICRON TECHNOLOGY: Awaits Final OK of Price-Fixing Suit Settlement MICRON TECHNOLOGY: Quebec Price-Fixing Suit Appeal Still Pending MICRON TECHNOLOGY: Awaits Court Approval of Idaho Securities Suit MISSION FOODS: Will Go to Trial Over Misleading Guacamole Claims NAT'L FOOTBALL LEAGUE: Judge Stays Class Action in Federal Court NEW YORK: MTA May Face Class Action Over Bus Clogging OHIO: App. Ct. Affirms Certification of Compensation Bureau Suit OHIO: To Fight Ruling on Class Action Over Group Discounts PENNSYLVANIA: ICFs/MR Residents Barred From Intervening in Suit ROLLS-ROYCE CORP: Denial of Randall Class Certification Affirmed SCHNEIDER LOGISTICS: Faces Class Action in Ill. Over Wage Theft SCORES HOLDING: Agrees to $450,000 Settlement in "Siri Diaz" Suit SH LEGGITT: Class Suit vs. Vanguard to Proceed in State Court SOUTHWOOD MANOR: Alaska UTPA Doesn't Apply to Residential Leases TEXAS: 5th Cir. Affirms Denial of Prisoner's Injunction Request UNITED STATES: Keepseagle Class Action Lawyers' Fee Challenged UNIVERSAL MUSIC: Rick James Estate Files Class Action * Wisconsin Investment Board to Hire Class Action Firm ********* AECOM: Faces $700MM Class Action Over RiverCity Collapse -------------------------------------------------------- Adele Ferguson, writing for The Sydney Morning Herald, reports that less than two months after the spectacular collapse of listed toll road operator RiverCity Motorways, its traffic modeling forecaster Aecom faces a $700 million class action. Litigation funder IMF will bankroll the class action and alleges that Aecom's statements in the PDS were misleading and deceptive and failed to provide investors with full information about another set of traffic figures it compiled on the project 18 months earlier. The case will be a landmark as it is the first time a traffic forecaster has become the target of a class action. It could also open up a can of worms as the spotlight turns to other traffic forecasters, particularly given the poor track record of such forecasting in toll road projects in the past decade. What will make this case interesting is that Rivercity provided an indemnity if the modeller was sued. The action will rely upon the insurance of RiverCity. RiverCity collapsed on February 25 after it was found that it only had enough cash to cover interest payments for a few months. The class action will be thrown open to all shareholders who took up shares in the float of RiverCity, which floated on the ASX in 2006. The issue of two installments at 50 cents each raised $690 million. A number of shareholders went back into the market and bought more shares when the share price started to tank on the basis they still believed the traffic forecasts in the PDS. The nub of the claim is that in the Product Disclosure Statement (PDS) Aecom forecast daily traffic numbers in the Clem7 Tunnel, which were chronically inaccurate. Aecom also failed to mention that it provided a different set of traffic figures 18 months earlier to Brisbane City Council's Environmental Impact Study on Clem7m, which were vastly different and would have raised questions about the viability of the project, according to the claim. In the PDS distributed to shareholders, Aecom forecast the average daily number of vehicles using the tunnel would be 90,676 within six months of operation and jump to 94,706 after 12 months. By 2011 they would hit more than 100,000 passing through the 6.8 kilometer tunnel, which runs between Bowen Hills in the north and Kangaroo Point and Wolloongabba in the south. In the PDS, Aecom refers to this earlier study and suggests that the modelling in the PDS is an "enhanced" form of the modelling used in the environmental impact study. What Aecom did not reveal in the PDS was that in their modelling for the EIS Aecom had forecast traffic volumes in 2011 of only 57,000 per week assuming a $3.30 toll. The PDS contains no reference to the fact that Aecom's PDS forecasts for 2011 are more than 65% higher than its EIS forecast, made only 18 months earlier. IMF believes investors may have rights to recover their losses in RiverCity under the Corporations Act 2001 because Aecom's statements in the PDS were misleading or deceptive; and/or Aecom omitted to provide investors with critical information relevant to their decision to acquire the units. The actual traffic numbers are averaging less than 24,000 per day. RiverCity's financial performance has been so disastrous that on 25 February 2011 it was placed in administration. RiverCity was a tale of woe from the beginning, and follows a number of other listed tollroads across the country that have suffered similar failures and left shareholders will little or nothing. BABIES "R" US: Aug. 1 Class Action Claim Filing Deadline Set ------------------------------------------------------------ Desiree Ferenczi, writing for ConsumerReports.org, that two proposed class action lawsuit settlements totaling up to $35.24 million have been reached with Toys "R" Us -- doing business as Babies "R" Us -- for allegedly conspiring with several manufacturers to illegally raise the prices on certain baby products. If you purchased one or more of the baby products listed below from Babies "R" Us during the dates noted, you may be able to receive a cash payment from the Baby Products Antitrust class action settlement. * BabyBjoern baby carrier, 2/2/00 - 4/30/05 * Britax car seat, 1/1/99 - 1/31/11 * Kids Line products*, 1/1/99 - 12/31/06 * Maclaren stroller, 10/1/99 - 1/31/11 * Medela Pump In Style breast pump, 7/1/99 - 1/31/11 * Peg Perego car seat, 7/1/99 - 1/31/11 * Peg Perego high chair, 7/1/99 - 1/31/11 * Peg Perego stroller, 7/1/99 - 1/31/11 (* All Kids Line products, including crib sets, blankets, valances, sheets, wall decorations, baskets, pillows, pads, hampers, porta crib sets, lamps, shelves, stackers, rugs, or mobiles, etc.) You must submit a valid claim form to receive a percentage of the purchase price you paid. You will also need to include proof of purchase: receipts, cancelled checks, credit card statements, or other records that show you purchased the baby product and when the purchase was made. The claim form and all related documentation must be postmarked, faxed or submitted online by Aug. 1, 2011. BP PLC: Faces Class Action for Canceling Dividend Payout -------------------------------------------------------- Courthouse News Service reports that in a federal class action, a shareholder says BP buckled to political pressure and unfairly canceled a dividend payout of $750 million, or 84 cents a share, which it had announced in the early days of the Deepwater Horizon disaster. A copy of the Complaint in Glenn v. BP P.L.C., Case No. 11-cv- 06124 (D. Or.), is available at: http://www.courthousenews.com/2011/04/13/BP.pdf The Plaintiff is represented by: Steve D. Larson Esq. Jennifer S. Wagner, Esq. Keith A. Ketterling, Esq. Jacob S. Gill, Esq. STOLL STOLL BERNE LOKTING & SHLACHTER P.C. 209 S.W. Oak Street, Fifth Floor Portland, OR 97204 Telephone: (503) 227-1600 E-mail: slarson@stollberne.com kketterling@stollberne.com jwagner@stollberne.com jgill@stollberne.com BUREAU OF COLLECTION: 10th Cir. Reverses "Lucero" Suit Dismissal ---------------------------------------------------------------- The U.S. Court of Appeal for the Tenth Circuit holds that the district court erred in dismissing Richard Lucero's class action suit against Bureau of Collection Recovery, Inc., without considering the timely motion for certification. Plaintiff's complaint was filed in state court seeking declaratory relief and damages, alleging violation of the Fair Debt Collection Practices Act and the New Mexico Collection Agency Regulatory Act on April 20, 2009. The complaint also included class action allegations. Defendant BCR subsequently removed the case to federal court. The district court concluded that because BCR offered to satisfy Plaintiff's entire claim, there was no longer a justiciable dispute. The district court granted BCR's motion to dismiss for lack of subject matter jurisdiction. And because BCR's offer of judgment had terminated, the district court did not compel Plaintiff to accept the judgment and did not enter a judgment against BCR. A three-judge panel of the 10th Circuit, composed of Paul Joseph Kelly, Jr., William Judson Holloway, Jr., and Deanell Reece Tacha, held that a named plaintiff in a proposed class action for monetary relief may proceed to seek timely class certification where an unaccepted offer of judgment is tendered in satisfaction of the plaintiff's individual claim before the court can reasonably be expected to rule on the class certification motion. "That certainly is the case here," the 10th Circuit said, "given the parties' agreement to proceed according to a specific schedule to resolve the class certification issues and given the Plaintiff's indisputable compliance with that schedule." The case is Richard Lucero, on behalf of himself and all others similarly situated, Plaintiff-Appellant v. Bureau of Collection Recovery, Inc., Defendant-Appellee, Case No. 10-2122, (10th Cir.). A copy of the 10th Circuit's March 31, 2011, Opinion is available at http://is.gd/RHe2Uvat Leagle.com. CISCO SYSTEMS: May 30 Class Action Lead Plaintiff Deadline Set -------------------------------------------------------------- Law Offices Bernard M. Gross, P.C. filed a class action lawsuit in the United States District Court, Northern District of California, 11cv01782, on behalf of all persons who purchased or otherwise acquired the common stock of Cisco Systems, Inc., between Feb. 3, 2010 and Feb. 9, 2011, against the Company, John T. Chambers, Frank Calderoni, Robert Lloyd, and Phil Smith for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. If you wish to serve as lead plaintiff, you must move the Court no later than May 30, 2011. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of its choice, or may choose to do nothing and remain an absent class member. If you wish to discuss this action or any questions concerning this notice, please contact plaintiffs' counsel, Deborah R. Gross or Susan R. Gross at 866- 561-3600 or via email at debbie@bernardmgross.com or susang@bernardmgross.com A copy of the complaint can be viewed at http://www.bernardmgross.com/ Cisco designs, manufactures, and sells internet protocol based networking and other products related to the communications and information technology industry and provides services related to their use worldwide. The Complaint alleges that, throughout the class period, defendants failed to disclose material adverse facts about the Company's true financial condition, business and prospects, specifically, intense pricing pressure from competitors forcing Cisco to dramatically lower its prices while allowing the individual defendants and certain Company insiders to collectively sell over 7.0 million shares of their personally-held Cisco common stock for proceeds in excess of $175 million, and thus caused Plaintiffs and members of the Class to purchase Cisco common stock at artificially inflated prices. On Feb. 9, 2011, defendants caused Cisco to announce its financial results for the 2011 fiscal second quarter, the period ended Jan. 29, 2011, in a press release and analyst call, wherein defendants noted that non-GAAP gross margins were 62.4%, down 1.9 percentage points quarter-over-quarter and down 3.2 percentage points year-over-year and product related non-GAAP gross margins for the second quarter were 61.1%, down 2.9 percentage points from the prior quarter. Due to the unexpected drop in Cisco's margins, the Company's shares fell $3.12 per share, or more than 14%, on extremely heavy trading volume. Plaintiffs are represented by Law Offices Bernard M. Gross, P.C. The firm has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud. Any questions, Please Contact: Susan R. Gross, Esq. Deborah R. Gross, Esq. LAW OFFICES BERNARD M. GROSS, P.C. Telephone: 866-561-3600 (toll free) E-mail: susang@bernardmgross.com debbie@bernardmgross.com Web site: http://www.bernardmgross.com/ CLARUS MARKETING: Accused of Defrauding Online Shoppers ------------------------------------------------------- Courthouse News Service reports that Clarus Marketing Group and Provide Commerce team up to defraud online shoppers by secretly enrolling them in and charging $9 to $20 a month for "membership" in a "club" -- merely because shoppers click on an offer for "free shipping," shoppers say in a federal class action. "Plaintiff is a victim of this scam, as are thousands of other class members who never agreed to join CMG's FreeShipping.com Insiders-Club," lead plaintiff Nicole Hall says. Ms. Hall says she was sucked into the scam when she bought flowers from Provide Commerce's website, ProFlowers.com, using her credit card. She clicked on free shipping, she says, but "never joined any type of membership program, including F reeShipping.com lnsiders-Club." Nonetheless, after a few months she discovered that Clarus had been charged her credit card $11.97 a month. "She was surprised to see the charges by CMG since she had never done business with CMG, she never authorized such charges, and she never authorized Provide Commerce to provide her account information to CMG." Provide Commerce is a Delaware corporation operating out of Eastgate Mall in San Diego. It runs at least five online shopping sites: RedEnvelope, ProFlowers, Cherry Moon Farms, Secret Spoon and Shari's Berries, according to the complaint. Clarus is a Connecticut corporation that operates out of Wethersfield, Conn. Ms. Hall seeks disgorgement, restitution, class damages and punitive damages for fraud, false advertising, unfair business practices, unjust enrichment, conversion and violations of the Electronic Communications Privacy Act. A copy of the Complaint in Hall v. Clarus Marketing Group, LLC, et al., Case No. 11-cv-01757 (N.D. Calif.), is available at: http://www.courthousenews.com/2011/04/13/Clarus.pdf The Plaintiff is represented by: Vahn Alexander, Esq. FARUQI & FARUQI, LLP 1901 Avenue of the Stars, 2nd Floor Los Angeles, CA 90067 Telephone: (310) 461-1426 E-mail: valexander@faruqilaw.com CONSUMER PRIVACY CASES: Calif. App. Ct. Affirms Copy Charges ------------------------------------------------------------ The Court of Appeal of California, First District, rejected an appeal by Renee M. Garvin from a order awarding $1,149.15 on plaintiffs' costs on appeal in the class action, In re Consumer Privacy Cases, Case No. A128862 (Calif. App. Ct.). Ms. Garvin's appeal is the second appeal in the case. She argued, in a March 2010 supplemental memorandum, that the respondents' counsel's $0.25 per page copying cost of the respondent's joint appendix was unreasonable and was not actually incurred. The trial court noted that it was presented with evidence establishing a range of per page copying charges, and found that $0.25 per page was respondents' counsel's regular charge and concluded that charge was reasonable. The appellate court agrees with the trial court on the matter of the reasonableness of the copy charges. The appellate court further finds that the trial court did not abuse its discretion when it rejected Ms. Garvin's allegations that the respondents' counsel's service of the joint appendix on co-counsel was unnecessary for the conduct of the litigation. The appellate court notes that Ms. Garvin asserted a conclusory argument but did not provide evidentiary support to establish her allegation. Thus, the appellate court affirms the trial court's award of costs on appeal to the respondents. The March 30, 2011 appellate court decision was penned by Judge Mark B. Simons, and concurred by Judges Barbara J.R. Jones and Terence L. Bruiniers. A copy of the decision is available at http://is.gd/d5u4Ltfrom Leagle.com. EI DUPONT: Cristal Dismissed as Defendant in Haley Paint Suit ------------------------------------------------------------- Judge Richard D. Bennett dismissed the class action, Haley Paint Company, et al. v. E.I. Dupont De Nemours and Co., et al., Civil Action No. RDB-10-0318 (D. Md.), as it pertains to The National Titanium Dioxide Company Ltd. d/b/a Cristal. On April 12, 2010, Haley Paint Company and Isaac Industries, Inc. filed a consolidated amended complaint and initiated a class action lawsuit against E.I. Dupont De Nemours and Co., Huntsman International LLC, Kronos Worldwide Inc., Millennium Inorganic Chemicals, Inc., and The National Titanium Dioxide Company Ltd. d/b/a Cristal, alleging a conspiracy to fix the price of titanium dioxide in the United States in violation of Section 1 of the Sherman Act, 15 U.S.C. Section 1. Plaintiffs filed the action on behalf of themselves and on behalf of a class consisting of all persons and entities who purchased titanium dioxide in the United States directly from one or more Defendants. Cristal sought to dismiss the class suit on grounds that it has not been properly served and for lack of personal jurisdiction. Cristal is a foreign corporation domiciled in the Kingdom of Saudi Arabia. Maryland-based Millennium manufactures titanium dioxide. According to Cristal, Millennium is its indirect subsidiary, and is a separate corporate entity with its own articles of incorporation and bylaws. Cristal contends that Millennium is not an agent or alter ego of Cristal. Pursuant to the District Court's ruling, the Court assumes, but does not hold, that Plaintiffs have effected service of process over Cristal under Rule 4(f)(2)(C)(ii) of the Federal Rules of Civil Procedure. In granting Cristal's motion to dismiss, the District Court held that Plaintiffs have the burden to prove that Cristal exerts considerable control over Millennium, and they have not made a sufficient showing. Plaintiffs may not impute to Cristal the jurisdictional contacts of Millennium, Judge Bennett said. Moreover, the District Court said Plaintiffs are not entitled to jurisdictional discovery in the matter because they have not provided a basis for piercing the "corporate veil." A copy of the March 31, 2011, District Court order is available at http://is.gd/B34pQ1from Leagle.com. GILAT SATELLITE: Merger-Related Suit Pending in Israeli Court ------------------------------------------------------------- Gilat Satellite Networks Ltd. continues to defend itself from a lawsuit filed in Israel in 2009 over a failed merger, according to the Company's April 12, 2011, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2010. In November 2009, a lawsuit was filed in the central district court in Israel by eight individuals and Israeli companies against the Company, all of its directors and its 20% shareholder, York Capital Management and its affiliates. The plaintiffs claim damages based on the amounts they would have been paid had the merger agreement signed on March 31, 2008, closed. The lawsuit, seeking damages of approximately $12.4 million, is similar to the lawsuit and motion for its approval as a class action proceeding previously filed by the same group of Israeli shareholders in October 2008. That lawsuit and motion were withdrawn by the plaintiffs in July 2009 at the recommendation of the court, which questioned the basis for the lawsuit. The Company and its outside legal counsel believe the claims in this 2009 action are completely without merit, and that the lawsuit is without basis. The Company intends to use all legal means necessary to protect and defend it and its directors. HYUNDAI CAPITAL: Class Action Poses Challenge to Customers ---------------------------------------------------------- Kang Seung-woo, writing for The Korea Times, reports that customers of Hyundai Capital are enraged over the company's ineptitude in protecting their data from cyber criminals, but bringing a class-action suit against the company looks to be a challenge. Hyundai Capital, an affiliate of automotives giant Hyundai Motor and the largest lender in the country's secondary financial sector, reported that the personal information of more than 420,000 of its customers has been breached by hackers. If any other company were involved, a security blunder of such a size would have lawyers scrambling to lure victims to sign up for collective legal action that could fetch them a massive payday. Things are a little more complicated with Hyundai Capital as many of those who borrowed from the company were in precarious financial situations to begin with. Many customers appear to feel that a class-action suit against the company would result in a backlash they couldn't afford. Should Hyundai Capital stop lending them money, their next option is to turn to the country's notorious loan sharks and their crippling interest rates. Major data breaches in the past, such as those involving online shopping site Auction -- http://www.auction.co.kr/-- refiner GS Caltex and e-mail provider Daum -- http://www.daum.net/-- had led to the creation of a slew of Web sites run by lawyers and law firms gunning for class-action suits. There is only one website for the Hyundai Capital fiasco with only two members who are obviously wondering whether a class action could be brought by a duo. Those who had their information breached accounted for more than 23% of Hyundai Capital's customers, and 13,000 might have had serious information such as their personal identification numbers for loans stolen as well. Right after discovering the information leak, Hyundai Capital informed its customers that they needed to change their passwords to avoid any possible damage. "We are recognizing that there might be a lawsuit," a Hyundai Capital official casually observed. "I was angry after receiving an e-mailed apology from Hyundai Capital that said my data had been stolen," wrote an Internet blogger. "I used Hyundai Capital to finance my car purchase. I assumed that a large company like Hyundai Capital would have a better security system to defend against hacking, but apparently, this was not the case." But anger seemed his only option. INSPIRE PHARMA: Being Sold to Merck for Too Little, Suit Claims --------------------------------------------------------------- Courthouse News Service reports that Inspire Pharmaceuticals is selling itself too cheaply to Merck, for $430 million or $5 a share, shareholders say in a class action. A copy of the Complaint in Luttenberger v. Inspire Pharmaceuticals, Inc., et al., Case No. 6363 (Del. Ch. Ct.), is available at: http://www.courthousenews.com/2011/04/13/DrugMerger.pdf The Plaintiff is represented by: Ryan M. Ernst, Esq. CROSS & SIMON, LLC 913 North Market Street, 11th Floor P.O. Box 1380 Wilmington, DE 19899-1380 Telephone: (302) 777-4200 E-mail: rernst@crosslaw.com - and - Donald J. Enright, Esq. Elizabeth K. Tripodi, Esq. 1101 30th Street, NW, Suite 115 Washington, DC 20007 Telephone: (202) 524-4290 E-mail: denright@zlk.com etripodi@zlk.com LORAL SPACE: 2nd Cir. Says Former CEO Did Not Omit Material Facts ----------------------------------------------------------------- The U.S. Court of Appeals for the Second Circuit upheld a district court's decision granting summary judgment for Bernard Schwartz, former Chief Executive Officer and the Chairman of Board of Directors of Loral Space & Communications, in a securities class action against him. The class action was brought on behalf of all persons or entities, other than Mr. Schwartz and the officers and directors of Loral or its subsidiaries, that purchased Loral securities between June 30, 2003 and July 15, 2003. The action, brought pursuant to the Securities Act of 1934, involves the Defendant's materially false and misleading representations concerning Loral's financial condition during the Class Period. Loral filed for Chapter 11 bankruptcy in 2003. It emerged in 2005. Plaintiff Harold Shapiro took an appeal from a February 27, 2009, judgment of the U.S. District Court for the Southern District of New York on Mr. Schwartz's summary judgment motion. The Plaintiff contends that the district court erred in focusing on allegations of material omissions, while ignoring allegations of affirmative misrepresentations in a July 1, 2003 Reuters article. The Plaintiff also argues that the former Loral CEO had a duty to disclose Loral's lack of viability and impending bankruptcy. Moreover, Mr. Schwartz's failure to disclose Loral's satellite sale negotiations with Intelsat and the related contingency bankruptcy plans "rendered Loral's Class period public statements materially incomplete and, thus, misleading," the Plaintiff says. But the 2nd Circuit held that based on the totality of the available information and the circumstances of the Loral bankruptcy, Mr. Schwartz was not required to disclose certain information because it was not material. The 2nd Circuit also pointed out that notwithstanding the positive business developments reported in the statements upon which the Plaintiff relies, the market was adequately informed of the dire nature of Loral's financial condition. "[I]n light of this 'total mix' of information, we conclude that the district court did not err in concluding that Schwartz had not omitted a material fact," the 2nd Circuit said. Accordingly, the 2nd Circuit affirmed the conclusion of the District Court to dismiss the class action's claims under sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The 2nd Circuit remanded the case to the district court for compliance with the Private Securities Litigation Reform Act. The appellate case is ROBERT BELESON, on behalf of himself and all others similarly situated, HARVEY MATCOVSKY, on behalf of himself and all others similarly situated, MARIA M. PFUSTERER, CHRIS, DAVID A. HULL, MARVIN RICH, Consolidated Plaintiffs, HAROLD SHAPIRO, Plaintiff-Appellant, TONY CHRIST, individually and as custodian for Brian and Katelyn Christ, Objector, CASEY CRAWFORD, individually and on behalf of all others similarly situated, Plaintiff, THOMAS ORNDORFF, individually and on behalf of all others similarly situated, Objector. v. BERNARD SCHWARTZ, Defendant-Appellee, RICHARD J. TOWNSEND, Consolidated Defendant, No. 09-1281-cv (2nd Cir.). A copy of the 2nd Circuit's April 5, 2011, Order, concurred by Circuit Judges Robert D. Sack, Robert A. Katzmann, and Richard C. Wesley, is available at http://is.gd/O4vOSIat Leagle.com. MECHEL OAO: Awaits Ruling on Dismissal Plea in "Frederick" Suit --------------------------------------------------------------- Mechel OAO is awaiting a ruling on its motion to dismiss all claims in the class action lawsuit alleging securities law violations pending in New York, according to the Company's April 12, 2011, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2010. On April 8, 2009, a person who had been a holder of the Company's common American Depositary Shares during the period October 2007- July 2008 filed an action against the Company in the United States District Court for the Southern District of New York, alleging claims against the Company and also naming as defendants the persons who were then the Company's chief executive officer, the Company's senior vice president and its vice president for finance. The case, Frederick v. Mechel OAO, No. 09 CV 3617 alleges claims under Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934. These claims arise from the Russian Federal Antimonopoly Service directive, in which the FAS claimed that the Company's pricing of coal concentrate of coking grades within the Russian Federation violated Russian antimonopoly laws and that, in addition, the Company used pricing mechanisms which could give rise to tax claims and the imposition of considerable sanctions on the part of the Russian government. The plaintiff in the class action alleges that the Company and its officers should have foreseen or did foresee these actions by the Russian authorities, and that the failure to disclose these risks constituted securities fraud under U.S. law. Lead plaintiffs have been appointed in the case, and the lead plaintiffs' Second Amended Complaint, filed on February 19, 2010, seeks certification of a class comprising all those who purchased Mechel's securities on the New York Stock Exchange between October 3, 2007, and July 25, 2008, and seeks imposition of unspecified damages. The Company says it has engaged counsel and is contesting this lawsuit vigorously. On April 2, 2010, the Company moved the court to dismiss all the claims against it. That motion has been fully briefed since June 21, 2010, and is awaiting decision. The Company expresses no opinion as to the likely outcome of the motion or of the case in general. METROPOLITAN PROPERTY: Back Doctors Suit Stays in Federal Court --------------------------------------------------------------- A three-member panel of the U.S. Court of Appeal for the Seventh Circuit remanded the class action complaint captioned, Back Doctors Ltd. v. Metropolitan Property and Casualty Insurance Company (7th Cir.), to the district court for further proceeding. Plaintiff is a provider of services, rather than an insured. Defendant is an insurance carrier. Plaintiff originally filed its class action complaint in an Illinois state court, contending that Defendant uses software that pays medical providers less than the policies require the insurer to pay. Plaintiff argued that using the software violates not only the contracts between insurer and insured but also the Illinois Consumer Fraud and Deceptive Business Practices Act. Defendant sought removal of the litigation to federal court under amendments that the Class Action Fairness Act of 2005 made to 28 U.S.C. Sections 1332(d) and 1453. Those provisions allow the removal of class actions in which the stakes exceed $5 million, provided that at least minimal diversity of citizenship exists. Back Doctors contended that the amount in controversy is less than $5 million and thus, asked the district court to remand the proceeding. That the stakes exceed $2.9 million is undisputed; the insurer contended that punitive damages make up the balance. Back Doctors replied that its complaint does not seek punitive damages. The district court ultimately remanded the proceeding, stating that removal is disfavored. Upon Defendant's appeal of the district court ruling, the 7th Circuit considered the matter on hand and noted that: -- Events after the date of removal do not affect federal jurisdiction, and this means in particular that a declaration by the plaintiff following removal does not permit remand; and -- Back Doctors has a fiduciary duty to its fellow class members. "A representative can't throw away what could be a major component of the class's recovery. Either a state or a federal judge might insist that some other person, more willing to seek punitive damages, take over as representative." A punitive award exceeding $2.1 million is possible in the litigation, the 7th Circuit pointed out, and thus the amount in controversy exceeds $5 million. Accordingly, the 7th Circuit vacated the order returning the class action suit to state court and remanded the action to the district court for decision on the merits. A copy of the 7th Circuit's April 1, 2011, Opinion is available at http://is.gd/ZHuD0Qat Leagle.com. The panel is composed of Chief Judge Frank H. Easterbrook, Judge Ilana Diamond Rovner, and Judge Terence T. Evans. MICRON TECHNOLOGY: Awaits Final OK of Price-Fixing Suit Settlement ------------------------------------------------------------------ Micron Technology, Inc., is still awaiting final court approval of its settlement of price-fixing lawsuits, according to the Company's April 12, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 3, 2011. At least sixty-eight purported class action price-fixing lawsuits have been filed against the Company and other DRAM suppliers in various federal and state courts in the United States and in Puerto Rico on behalf of indirect purchasers alleging price-fixing in violation of federal and state antitrust laws, violations of state unfair competition law, and/or unjust enrichment relating to the sale and pricing of DRAM products during the period from April 1999 through at least June 2002. The complaints seek joint and several damages, trebled, in addition to restitution, costs and attorneys' fees. A number of these cases have been removed to federal court and transferred to the U.S. District Court for the Northern District of California for consolidated pre-trial proceedings. In July, 2006, the Attorneys General for approximately forty U.S. states and territories filed suit in the U.S. District Court for the Northern District of California. The complaints allege, among other things, violations of the Sherman Act, Cartwright Act, and certain other states' consumer protection and antitrust laws and seek joint and several damages, trebled, as well as injunctive and other relief. On October 3, 2008, the California Attorney General filed a similar lawsuit in California Superior Court, purportedly on behalf of local California government entities, alleging, among other things, violations of the Cartwright Act and state unfair competition law. On June 23, 2010, the Company executed a settlement agreement resolving these purported class-action indirect purchaser cases and the pending cases of the Attorneys General relating to alleged DRAM price- fixing in the United States. Subject to certain conditions, including final court approval of the class settlements, the Company agreed to pay a total of approximately $67 million in three equal installments over a two-year period. No further updates were reported in the Company's latest SEC filing. MICRON TECHNOLOGY: Quebec Price-Fixing Suit Appeal Still Pending ---------------------------------------------------------------- An appeal from a ruling denying class certification in a lawsuit filed in Quebec, Canada, alleging price-fixing of DRAM products remains pending, according to Micron Technology, Inc.'s April 12, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 3, 2011. Three putative class action lawsuits alleging price-fixing of DRAM products have been filed against the Company in Quebec, Ontario, and British Columbia, Canada, on behalf of direct and indirect purchasers, asserting violations of the Canadian Competition Act and other common law claims. The claims were initiated between December 2004 (BC) and June 2006 (Quebec). The plaintiffs seek monetary damages, restitution, costs, and attorneys' fees. The substantive allegations in these cases are similar to those asserted in the DRAM antitrust cases filed in the United States. Plaintiffs' motion for class certification was denied in the British Columbia and Quebec cases in May and June 2008, respectively. Plaintiffs subsequently filed an appeal of each of those decisions. On November 12, 2009, the British Columbia Court of Appeal reversed the denial of class certification and remanded the case for further proceedings. The appeal of the Quebec case is still pending. No further updates were reported in the Company's latest SEC filing. MICRON TECHNOLOGY: Awaits Court Approval of Idaho Securities Suit ----------------------------------------------------------------- On February 24, 2006, a putative class action complaint was filed against Micron Technology, Inc., and certain of its officers in the U.S. District Court for the District of Idaho alleging claims under Section 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. Four substantially similar complaints subsequently were filed in the same Court. The cases purport to be brought on behalf of a class of purchasers of the Company's stock during the period February 24, 2001 to February 13, 2003. The five lawsuits have been consolidated and a consolidated amended class action complaint was filed on July 24, 2006. The complaint generally alleges violations of federal securities laws based on, among other things, claimed misstatements or omissions regarding alleged illegal price-fixing conduct. The complaint seeks unspecified damages, interest, attorneys' fees, costs, and expenses. On December 19, 2007, the Court issued an order certifying the class but reducing the class period to purchasers of the Company's stock during the period from February 24, 2001, to September 18, 2002. On August 24, 2010, the Company executed a settlement agreement resolving these purported class-action cases. Subject to certain conditions, including final court approval of the class settlement, the Company agreed to pay $6 million as its contribution to the settlement. No further updates were reported in Micron Technology, Inc.'s April 12, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 3, 2011. MISSION FOODS: Will Go to Trial Over Misleading Guacamole Claims ---------------------------------------------------------------- Nick McCann at Courthouse News Service reports that famed tortilla maker Mission Foods will head to trial over claims that it misleads consumers about transfat content by calling its spicy bean dip "all natural," and using "guacamole" to describe a dip that contains less than 2% avocado powder, a Los Angeles federal judge ruled. Lead plaintiffs Mary Henderson and Eileen Joy Peviani accused the manufacturer's Nevada-based parent, Gruma Corp., of using misleading labels for its guacamole and bean dips. The labels on Mission Guacamole and Mission Spicy Bean Dip promise "0 g transfat" and "0 g cholesterol" -- but the plaintiffs say the claims aren't true, and that guacamole-flavored dip isn't the same as guacamole. They argue that Gruma lies further when it claims that the "all natural" dips are made in "the authentic tradition" and "with garden vegetables." Ms. Henderson and Ms. Peviani say they lost money from buying Gruma's dips, and that they would not have bought the products if the labels did not conceal the incidence of transfat, which has been linked to cardiovascular disease, diabetes and cancer. U.S. District Judge A. Howard Matz ruled on April 11 that the plaintiffs identified a legitimate injury under unfair competition and false advertising laws, and that Gruma did not prove that it has removed the misleading labels from its products. "With such advertising remaining on supermarket shelves, Plaintiffs, as representatives of a class, should be entitled to pursue injunctive relief on behalf of all consumers in order to protect consumers from Defendant's alleged false advertising," Judge Matz wrote. The judge did strike several claims from the suit before letting it proceed to trial, however. Though the class can seek restitution and damages, Judge Matz threw out their claims for disgorgement of profits under the False Advertising Act. Gruma can also advertise its products as made in "the authentic tradition" and "with garden vegetables," since the first claim is simple puffery and the latter claim is accurate, if you disregard the amount of vegetables used. "The product does in fact contain vegetables that can be grown in a garden," Judge Matz wrote, citing the avocado powder, dehydrated onion and garlic powder present in Mission Guacamole. Since the Food and Drug Association regulates Mission products, and lets Gruma round down, Judge Matz found that the claims about "0 g transfat" and "0 g cholesterol" were pre-empted by federal law. "If the serving contains less than 0.5 gram [of transfat], the content, when declared, shall be expressed as zero," according to FDA regulations. Judge Matz will let the class press forward with claims over the "guacamole" label and the "all natural" label on the bean dip. "A reasonable consumer could interpret Defendant's statements and label to imply that the product is indeed guacamole, which it is not, as it allegedly contains less than 2% avocado powder," Judge Matz wrote. Though Gruma says that the word is just a part of the title, "Guacamole Flavored Dip," Judge Matz pointed out that the label makes the word "guacamole" much more prominent than the words "flavored dip." A copy of the decision in Henderson, et al. v. Gruma Corporation, Case No. 10-cv-04173 (C.D. Calif.), is available at: http://www.courthousenews.com/2011/04/12/dip.pdf NAT'L FOOTBALL LEAGUE: Judge Stays Class Action in Federal Court ---------------------------------------------------------------- Dan McCue at Courthouse News Service reports that a federal judge in Dallas has denied a request by aggrieved Super Bowl XLV ticketholders to have their class action against the NFL and the Dallas Cowboys remanded to a state court. U.S. District Judge Barbara M.G. Lynn said the plaintiffs -- ticketholders who had been denied, relocated or delayed in being seated for the big game between the Green Bay Packers and the Pittsburgh Steelers -- failed to show any compelling reason why the case should be remanded to the state's Dallas County District Court, where it was initially filed. Cowboys owner Jerry Jones had believed that Super Bowl XLV would be a coming-out party of sorts for the $1.5 billion Cowboys Stadium in Arlington, Texas. Instead, a rare winter storm little more than a week before the Super Bowl substantially damaged part of the facility. As a result, an estimated 2,000 fans were displaced during the game, and another six people visiting the stadium Super Bowl week were injured by melting snow and ice that fell from the stadium roof. NFL Commissioner Roger Goodell later apologized for problems at the stadium and offered the 400 who were left entirely without any seating at all free tickets to the next Super Bowl -- currently scheduled to be held in Indianapolis next February, pending the ratification of a new NFL labor agreement. He also offered free merchandise, food and beverages. In the meantime, however, three ticketholders, Ken Laffin, David Wanta and Rebecca Burgwin, sued on behalf of themselves and similarly situated fans, claiming fraud, breach of contract, fraudulent inducement, negligence and negligent misrepresentation. Along with the NFL and the Cowboys, the class named Jones' JWJ Corp. and the stadium as defendants. On Feb. 18, 2011, the defendants removed the class action the U.S. District Court for the Northern District of Texas, noting that the amount of the controversy exceeded $5 million. In considering the ticketholders' motion to return the case back to state court, the federal judge cited the Class Action fairness Act, which extends original jurisdiction of class-action lawsuits to federal courts in cases where the proposed class contains more than 100 members, where minimal diversity exists between the parties, when the amount in controversy exceeds $5 million and when principal defendants are not states, state officials or other governmental entities. Though removing parties still carry the burden of establishing federal jurisdiction, the burden shifts to the objecting party once that jurisdiction is established, Judge Lynn ruled. Trying to show any jurisdictional exceptions through a preponderance of the evidence, the defendants said more than 3,200 ticketholders were either displaced or relocated. They also claimed compensatory damages would not exceed $2.5 million. While the plaintiffs called the number of alleged class members highly speculative, Judge Lynn said it was unlikely that many, if any, had already settled with the defendants. After all, the NFL had mailed a settlement offer to ticketholders just two days before the lawsuit was filed, Judge Lynn found. Punitive damages must also be factored into the decision, Judge Lynn added. If the plaintiffs win "just" $2.5 million in compensatory damages, they can expect at least that amount in punitive damages, along with a "reasonable and conservative" estimate of $1 million in attorneys' fees. A copy of the Memorandum Opinion and Order in Laffin, et al. v. National Football Leauge, et al., Case No. 11-cv-00345 (N.D. Tex.), is available at: http://www.courthousenews.com/2011/04/13/superbowl%20tickets.pdf NEW YORK: MTA May Face Class Action Over Bus Clogging ----------------------------------------------------- Grace Rauh, writing for NY1.com, reports that buses clogging the street, double parking, idling along the curb: it's a view one might expect to see near the Port Authority, but the scene actually plays out each weeknight along East 57th Street between 3rd and Lexington Avenues. "A lot of the residents and the store owners want to do a class action suit against the MTA because what they are doing is actually illegal and dangerous," said Bob Schagrin, owner of Crush Wine & Spirits on 57th Street. Manhattan Councilman Dan Garodnick says more than 500 buses stop each day on the north side of the street alone. "The buses are extremely loud, they are extremely disturbing. You can actually taste the exhaust when you are standing out there," Mr. Garodnick said. Mr. Garodnick and other local politicians sent a letter to the Metropolitan Transit Authority and the city's Department of Transportation this week detailing the conditions and the serious problems caused by so many buses. "I've actually witnessed several people getting hit from buses turning off of 3rd Avenue and onto 57th Street," Mr. Schagrin said. The MTA itself last year said that the intersection of East 57th and 3rd had the most bus accidents in the city in 2009. There's also the question of noise and pollution. The manager of this restaurant says he can no longer open windows in the summer, at least not during the week. Not only are residents frustrated by the idling buses, but also by those that turn off their engines and sit for long stretches of time along the sidewalk, blocking entrances to buildings and businesses. "Anyone who is looking from the other side of the street can't see the store. And we pay very high rent just for the street view," said Mark Shapin of Belmora Pizza. A spokesman for the MTA says it is trying to find additional space for buses to wait nearby, but so far it hasn't come up with a suitable location. The spokesman says idling isn't allowed, and violations will be issued to drivers who do not follow the rules. OHIO: App. Ct. Affirms Certification of Compensation Bureau Suit ---------------------------------------------------------------- A three-member panel of the Court of Appeals of Ohio, Eighth District, Cuyohoga County, upheld the decision of a trial court granting class certification of the action entitled San Allen, Inc., et al. v. Stephen Buehrer, Administrator Ohio Bureau of Workers' Compensation, 2011-Ohio-1676 (Ohio App. Ct.). The panel is comprised of Judges Sean C. Gallagher, Frank D. Celebrezze, and James J. Sweeney. Plaintiffs filed a class action complaint, on behalf of themselves and similarly situated employers, raising statutory and constitutional challenges to the BWC's implementation of a group- experience rating plan. The plan allegedly granted group rated employers excessive discounts, which were subsidized by overcharging non-group rated employers through inflated base rates. Plaintiffs state that they are all employers that were non-group rated for one or more of the policy years at issue. The class suit was filed in the Cuyohoga County Court of Common Pleas. The trial court certified a class of "Ohio private employers subscribing to the Ohio workers' compensation State Fund, for any policy year from July 1, 2001 through and including policy year July 1, 2008, who in any of those policy years were rated on a non-group basis and who reported payroll and paid premiums in a manual classification for which the base rate was 'inflated' due to experience modifications under the group experience rating plan." On appeal, BWC argued that the trial court certified an overly broad class that included parties who suffered no injury attributable to the BWC's group-experience rating plan. The Appellate Court disagrees with BWC's contention. The Appellate Court said it is not persuaded by the BWC's arguments pertaining to injury, setoff and recoupment. The Appellate Court did not find that the trial court abused its discretion in finding the class membership, typicality, adequacy and commonality requirements were met. In affirming the trial court's decision to grant class certification, the Appellate Court remanded the matter for further proceedings. On remand, the trial court should strongly consider bifurcating the action on liability and damages, the Appellate Court noted. A copy of the Appellate Court's April 7, 2011, Opinion is available at http://is.gd/CEHsTCat Leagle.com. OHIO: To Fight Ruling on Class Action Over Group Discounts ---------------------------------------------------------- Business First reports that the Ohio Bureau of Workers' Compensation says it's considering fighting a court ruling that could spark a class-action suit over the agency's group discounts, the Associated Press reports. A state circuit court upheld a ruling granting class-action status to a suit filed by employers who say BWC wrongly gives major premium discounts to employer pools, the news service reported. The companies filing suit say it unconstitutionally forces them to foot the bill for the discount. Should BWC appeal the decision, it would take the case to the Ohio Supreme Court, the news service reported. PENNSYLVANIA: ICFs/MR Residents Barred From Intervening in Suit --------------------------------------------------------------- A three-member panel of the U.S. Court of Appeals for the Third Circuit affirmed the district court's order denying Springstead, et al.'s request to intervene in a class action commenced by residents of intermediate care facilities. Plaintiffs are individuals with mental retardation who reside in intermediate care facilities for persons with mental retardation -- ICFs/MR -- operated by the Pennsylvania Department of Public Welfare. They contend that the DPW's failure to offer community services to them and others similarly situated violates the integration mandates of the Americans with Disabilities Act and the Rehabilitation Act. The Springstead Intervenors are residents of Pennsylvania ICFs/MR who would decline community placement if it were offered to them. They moved to intervene of right and permissively under Rule 24 of the Federal Rules of Civil Procedure. Intervenors alleged that they are de facto members of the certified class; that they have protectable interests jeopardized by the lawsuit; and that neither Plaintiffs nor the DPW sufficiently represent their interests. The district court denied the motion to intervene of right or permissively, and Intervenors timely appealed. The 3rd Circuit agrees with the district court that the Intervenors' interest in maintaining their current form of care is not directly in jeopardy in the litigation. The current parties, the 3rd Circuit points out, have deliberately defined the class and the relief sought so that Intervenors' right to choose institutional treatment would not be affected. The 3rd Circuit, however, declined to speculate on that matter of whether reallocation of DPW resources will result in the closing of one or more ICFs/MR. The Intervenors have expressed concern that they are likely to be affected by the outcome of the lawsuit because relief sought by Plaintiffs might result to closure of ICFs/MR. The case is Joyce McCarthy; SYLVIA BALDWIN, by and through her next friend Shirl Meyers; ANTHONY BEARD, by and through his next friend, Nicole Turman, on behalf of themselves and all others similarly situated, v. DEPARTMENT OF PUBLIC WELFARE OF THE COMMONWEALTH OF PENNSYLVANIA; SECRETARY OF PUBLIC WELFARE OF THE COMMONWEALTH OF PENNSYLVANIA CRAIG SPRINGSTEAD, by and through his father and guardian, Bertin Springstead; MARIA MEO, by and through her mother and guardian, Grace Meo; DANIEL BASTEK, by and through his father and guardian, John Bastek; MICHAEL STORM, by and through his guardian, Polly Spare; BETH ANN LAMBO, by and through her father and guardian, Joseph Lambo; RICHARD CLARKE, by and through his father and guardian, Leonaed Clarke; RICHARD KOHLER, by and through his sister and guardian, Sara Fuller; MARIA KASHATUS, by and through her father and guardian, Thomas Kashatus; WILSON SHEPPARD, by and through his brother and next friend, Alfred Sheppard, Appellants, No. 10-1908 (3rd Cir.). A copy of the 3rd Circuit's April 5, 2011 Opinion is available at http://is.gd/nI192iat Leagle.com. The panel is composed of Circuit Judges Walter King Stapleton, Kent A. Jordan, and Joseph A. Greenaway, Jr. ROLLS-ROYCE CORP: Denial of Randall Class Certification Affirmed ---------------------------------------------------------------- A three-member appellate court panel affirmed a lower court's order denying class certification of the suit, In re Randall v. Rolls-Royce Corporation, et al., Case No. 10-3446, (7th Cir.) The panel consists of Circuit Judges Richard Posner, Joel M. Flaum, and Diane S. Skyes. Plaintiffs commenced the class action on behalf of more than 500 female employees of a Rolls-Royce plant in Indiana that manufactures aircraft, industrial, and marine engines. Plaintiffs charge Rolls-Royce with sex discrimination, in violation of Title VII and the Equal Pay Act, in paying the members of the class less than comparable male employees by setting the base pay of women employees in the class members' compensation categories below that of male employees in the same categories, and in denying them promotions they would have received had they been men. "The Plaintiffs' challenge to the denial of class certification fails," Judge Posner, who penned the decision, said. "Their claims are [] significantly weaker than those of some (perhaps many) other class members." The adequacy of the plaintiffs' representation is further undermined by the existence of a conflict of interest, beyond that implicit in their having weaker claims than some of the unnamed class members, between them and unnamed class members, the 7th Circuit noted. There is even evidence that the plaintiffs participated in decisions concerning female employees' compensation that, on their theory of the case, were discriminatory, the 7th Circuit stated. The 7th Circuit further disagreed with the plaintiffs' assertion that a class action may be maintained even if the equitable relief is mainly monetary. It would not be enough to award all class members 5% of their earnings during the complaint period to erase the alleged discriminatory differential in pay between male and women employees, Judge Posner says. "The claim of discrimination presents a further complication," Judge Posner held. He noted that because Rolls-Royce does not have a fixed compensation schedule for employees in the compensation categories at issue, individualized hearings would be required to determine how much higher an employee's pay would have been had she received a promotion denied her on the ground of her sex. A copy of the March 30, 2011, appellate court order is available at http://is.gd/0Ci2lWfrom Leagle.com. SCHNEIDER LOGISTICS: Faces Class Action in Ill. Over Wage Theft --------------------------------------------------------------- K. Scarpati, writing for Supply Chain Digital, reports that lots of attention has been paid to the Dukes v. Wal-Mart case, the largest class-action civil-rights lawsuit in American history that could affect 1.6 million women, but a smaller class-action lawsuit indirectly against a Wal-Mart warehouse is slowly getting more and more attention. Eight workers have accused Schneider Logistics, a Wal-Mart contractor, and another firm of violating state and federal labor laws. The suit could involve hundreds of warehouse employees should it be certified class-action. Schneider Logistics runs an Elwood, Ill. warehouse, which basically serves as a Mid-West Wal-Mart distribution center. The eight workers allege the distribution company failed to follow through on a promise of a $10 hourly rate, a "piece rate" for each items shipped and bonuses for "team lifts" that involved heavy loads. "I noticed after a couple of weeks that my checks didn't match my hours," worker Robert Hines said. "People are breaking their backs, trying to feed their families and be right." Mr. Hines also claimed he sometimes worked more than 50 hours per week and was shortchanged on overtime. Mr. Hines and other workers marched on the warehouse earlier this year, hoping to resolve the issue short of a lawsuit, but they were encouraged to go to court by a local advocacy group, Warehouse Workers for Justice. Wal-Mart was the world's largest public corporation in 2010 by revenue and has distribution centers and warehouses in 39 states and Washington D.C., according to an online listing. The case is Collins, et al. v. Schneider Logistics, et al., and will be heard at the Illinois Northern District Court. SCORES HOLDING: Agrees to $450,000 Settlement in "Siri Diaz" Suit ----------------------------------------------------------------- Scores Holding Company, Inc., has agreed to a $450,000 settlement in a wage and hour violations lawsuit pending in New York, according to the Company's April 12, 2011, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2010. On October 9, 2007, former Go West bartender Siri Diaz filed a purported class action and collective action on behalf of all tipped employees against the Company and other defendants alleging violations of federal and state wage/hour laws (Siri Diaz et al. v. Scores Holding Company, Inc.; Go West Entertainment, Inc. a/k/a Scores West Side; and Scores Entertainment, Inc., a/k/a Scores East Side, Case No. 07 Civ. 8718 (Southern District of New York, Judge Richard M. Berman)). On November 6, 2007, plaintiffs served an amended purported class action and collective action complaint, naming dancers and servers as additional plaintiffs and alleging the same violations of federal and state wage/hour laws. On February 21, 2008, plaintiffs served a second amended complaint adding two additional party defendants, but limiting the action to persons employed in the New York Scores' clubs. The amended complaint alleged that the Company and the other defendants are "an integrated enterprise" and that the Company jointly employ the plaintiffs, subjecting all of the defendants to liability for the alleged wage/hour violations. On behalf of itself and the other defendants, the Company filed a motion to dismiss that portion of the Complaint that asserted State law class action allegations; the Company also moved to dismiss the claims of two of the named plaintiffs for failure to appear for depositions. At the same time, plaintiffs moved for conditional certification under the federal law for a class of the servers, bartenders and dancers; the Company opposed that motion. On May 9, 2008, the Court issued its decision, denying the motion to dismiss and granting conditional certification for a class of servers, cocktail waitresses, bartenders and dancers who have worked at Scores East since October 2004. On May 29, 2008, the Company filed an answer to plaintiff's' second amended complaint. On September 5, 2009, plaintiffs served their third amended complaint adding in two individual defendants who are alleged to be employers under the state and federal wage claims. The Company disputes that it is a proper defendant in this action and the Company disputes that it violated the federal and state labor laws, and further dispute that the dancers are "employees" subject to the federal and state wage and hour laws. Two of the defendants have been dismissed without prejudice and the Company has agreed upon a settlement amount of $450,000 that will be contributed among and between all of the remaining defendants. The settlement documents are currently in the process of being prepared. SH LEGGITT: Class Suit vs. Vanguard to Proceed in State Court ------------------------------------------------------------- Bankruptcy Judge H. Christopher Mott lifted the automatic stay in the bankruptcy case of S.H. Leggitt Company to allow Audie Dragon, Sr. and John B. Howard, on behalf of themselves and purportedly on behalf of all others similarly situated, to proceed with their lawsuit against Vanguard Industries, Inc., Vanguard Plastics, Inc., and Vanguard Piping Systems, Inc., in the District Court of McPherson County, Kansas, case no. 01-C-98. S.H. Leggitt Company, Vanguard Plastics, Inc., Viega, Inc., and others entered into the VPI Escrow Agreement dated October 14, 2005, whereby $4,530,286 has been deposited into escrow. The Escrow Agreement was entered into in connection with a Stock Purchase Agreement dated Sept. 23, 2005, between Viega, Vanguard Industries, the Debtor and others. In general, the Plaintiffs asked the Court to determine and declare that the automatic stay in the Debtor's bankruptcy case does not apply to the State Court Suit and that the Debtor has no interest in the Escrow Funds protected by the automatic stay, or in the alternative, to lift the automatic stay. In general, the Debtor and the Official Committee of Unsecured Creditors in its case oppose the Plaintiffs' Motion and assert that the Debtor has an interest in the Escrow Funds which are property of the Debtor's bankruptcy estate, that the automatic stay applies and should not be lifted. The Debtor and Committee further contend that the issue regarding whether the Debtor's bankruptcy estate has an interest in the Escrow Funds and the extent of such interest should be determined through an adversary proceeding filed by the Debtor and the Committee against Plaintiffs, the Vanguard Companies and others in the Bankruptcy Court, adversary no. 11-1031. The Bankruptcy Court agrees that the State Court -- and any appellate tribunals -- are certainly the best and proper forum for and should move forward with the certification or decertification of any class of Plaintiffs, and adjudication of the validity and amount of any claims held by Plaintiffs against the Vanguard Companies. However, the Bankruptcy Court held that no funds shall be distributed out of the Escrow Funds that would cause the Escrow Funds to contain less than the amount of $2,138,295 (47.2% of the Escrow Funds), without approval of the Bankruptcy Court. The automatic stay will remain in place with respect to $2,138,295 of the Escrow Funds (47.2% of the Escrow Funds), until a final judgment is entered by the Bankruptcy Court in the Adversary Proceeding determining the extent of the Debtor's interest in the Escrow Funds or other Bankruptcy Court order. A copy of the Bankruptcy Court's April 12 Memorandum Opinion and Order is available at http://is.gd/Fg6IcKfrom Leagle.com. About SH Leggitt San Marcos, Texas-based S.H. Leggitt Company, aka Marshall Products -- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas Controls, Inc. -- sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Case No. 10-10279) on Feb. 2, 2010. In its schedules, the Debtor listed $15,869,020 in total assets and $11,404,353 in total debts. Joseph D. Martinec, Esq., and Rebecca S. McElroy, Esq., Ed Winn, Esq., and Lee Vickers, Esq., at Martinec, Winn, Vickers & McElroy, P.C., represent the company. As reported by the Troubled Company Reporter on Feb. 14, 2011, S.H. Leggitt proposed a chapter 11 plan of reorganization and the U.S. Bankruptcy Court has approved the company's disclosure statement explaining that plan. The plan proposes to insulate the reorganized company from all future product liability claims arising out of the use of products manufactured by the debtor and used in the manufacture of consumer LP-Gasgrills, cookers and other outdoor LP-Gas cooking appliances. The Debtor supplied LP- Gas regulators to the majority of the companies who made such appliances in North America between 1990 and 2005. The Debtor has also supplied gas regulators to the majority of companies that manufacture recreational vehicles in North America. SOUTHWOOD MANOR: Alaska UTPA Doesn't Apply to Residential Leases ---------------------------------------------------------------- Justice Daniel E. Winfree of the Supreme Court of Alaska affirmed a superior court decision dismissing an unfair practices claim in the class action captioned Diane Roberson, on behalf of herself and all others similarly situated v. Southwood Manor Associates, LLC, Case No. 6548 (Alaska Sup. Ct.). Southwood Manor owns and operates a mobile home park in Anchorage, Alaska, where Ms. Roberson was a tenant from September 1997 to August 2008. Southwood Manor sued Ms. Roberson for back rent and late charges. Ms. Roberson filed class action counterclaims, one of which asserted that the late charges violated Alaska's Unfair Trade Practices and Consumer Protection Act. Justice Winfree agreed with the superior court that the UTPA does not apply to residential leases. The UTPA does not apply to real property transactions and a lease is a real property transaction because it contains a transfer of the property's interest, the Supreme Court holds. Accordingly, the Supreme Court upholds the superior court's ruling on Ms. Roberson's UTPA claim. A copy of the Supreme Court's April 8, 2011, Opinion is available at http://is.gd/TPIgutat Leagle.com. TEXAS: 5th Cir. Affirms Denial of Prisoner's Injunction Request --------------------------------------------------------------- The U.S. Court of Appeals for the Fifth Circuit affirmed the district court's denial of plaintiff's preliminary injunction motion in the action, R. Wayne Johnson, plaintiff-appellant v. Rick Thaler, Director, Texas Department of Criminal Justice, Correctional Institutions Division, defendant-appellee, Case No. 10-50262, (U.S. Ct. App. 5th Cir.) Mr. Johnson is a Texas prisoner. He asserted motions for preliminary injunction and for class-action certification. The motions were filed in conjunction with a 28 U.S.C. Section 2254 application, in which Mr. Johnson challenged the validity of Texas's habeas corpus law, the alleged use of disciplinary infractions to deny inmates release on mandatory supervision, and the charging of criminal acts as disciplinary infractions. Mr. Johnson's application also stated that he was seeking an injunction ordering Texas courts and officials to adhere to Supreme Court precedent, declaring Texas's habeas corpus law void, and ordering Texas officials to discontinue prosecuting criminal acts as disciplinary infractions in the absence of full constitutional safeguards at disciplinary hearings. The 5th Circuit agrees with the district court that Mr. Johnson has not met the criteria for warranting a preliminary injunction. The 5th Circuit further notes that Mr. Johnson's notice of appeal was filed well more than 14 days after the denial of his motion for certification. Thus, the 5th Circuit dismissed his petition for permission to appeal the class certification denial as untimely filed. A copy of the 5th Circuit's April 8, 2011, Opinion, as concurred by Circuit Judges Jacques L. Wiener, Edward C. Prado, and Priscilla Owen, is available at http://is.gd/3kjkELat Leagle.com. UNITED STATES: Keepseagle Class Action Lawyers' Fee Challenged -------------------------------------------------------------- According to an article posted at The Blog of Legal Times by Mike Scarcella, responding to a judge's request, the Justice Department on April 12 said the plaintiffs' lawyers in a Native American class action should not receive the maximum legal fee award that the settlement in the case allows. The settlement in Keepseagle v. Vilsack, a suit over alleged discrimination against Native American farmers and ranchers in loan processing, said the plaintiffs' lawyers are entitled to between $30.4 million and $60.8 million for their work in the 12-year-old case in Washington federal district court. In court earlier this month, Judge Emmet Sullivan asked why he should not award the maximum amount the plaintiffs can receive in the $760 million settlement. On April 12, Justice Department lawyers responded to the judge, saying $60.8 million "bears no meaningful relationship to the work performed" in the case. A Justice lawyer, Amy Powell of the Civil Division's federal programs branch, said $30.4 million is a reasonable fee award and will fairly compensate the plaintiffs' attorneys, led by Joseph Sellers of Washington's Cohen Milstein Sellers & Toll. "Although the government's interest in the matter is secondary to that of the class, the government has an interest in ensuring that funds from federal coffers are expended efficiently to benefit the class and to effectuate the purposes of the settlement," Ms. Powell said in court papers. DOJ lawyers said the question before Judge Sullivan isn't really why he should not grant the plaintiffs' request for $60.8 million "but whether class counsel has justified the amount they seek." Mr. Sellers and the plaintiffs' lawyers argue they took a risk of nonpayment and advanced funds. But Justice attorneys said the class lawyers do not explain what multiplier or percentage was necessary for the attorneys to take that risk. Judge Sullivan is planning to meet with the lawyers April 26 for a hearing on the fee dispute. UNIVERSAL MUSIC: Rick James Estate Files Class Action ----------------------------------------------------- Tamera H. Bennett, writing for Billboard.biz, reports that The Rick James estate filed a class action lawsuit against Universal Music Group and it's raising expectations that more artists may enter the license-vs.-sale battle over digital downloads. But the clock could be ticking for heritage artists interested in pursuing action against their former record labels. In its suit against UMG, the James estate is seeking damages for what it alleges are unpaid royalties for the sale of music through digital downloads and ringtones. The filing came just days after the U.S. Supreme Court declined to review an appellate court decision granting F.B.T. Productions a greater share of royalties from UMG's sale of Eminem's music through digital downloads and ringtones. The Allman Brothers Band recently settled a proposed class action case against Sony Music Entertainment on the same issue: Is a digital download a license or a sale? In accordance with the Eminem decision in the Ninth Circuit Court of Appeals, a digital download is a license, and an artist is typically entitled to 50% of what the record label was paid for the license, versus a lesser percentage that would be due for the sale of a record. With record labels using standard agreements from the mid-'60s to the mid-2000s, the James estate is banking on having its case certified as a class action and bringing aboard thousands of plaintiffs who had record or production deals with UMG or affiliated record labels from Jan. 1, 1965, to April 30, 2004. What the James estate may not be counting on is another fairly standard provision in these recording contracts: the "incontestability provision." Most artist contracts signed during the proposed class window include language such as this: "All royalty statements rendered by the label to the artist shall be binding upon the artist and not subject to any objection by the artist for any reason unless specific objection in writing, stating the basis thereof, is given to the label within one year from the date the statement is rendered." A similar incontestability provision was included in the 1985 Allman Brothers recording agreement (originally signed with PolyGram Records) that's part of the band's current litigation against UMG pending in federal district court in New York. The court held in 2008 that the clause was valid and enforceable and denied the challenge to certain royalty statements because there wasn't a timely objection to the statements in accordance with the contract. Whether there is a one-, two-, three- or even a four-year window of time to object to a royalty statement, heritage artists who intend to challenge the royalty rate they've been paid for digital downloads may be barred from collecting years of unpaid revenue unless they act immediately. Joining the James estate's class action may sound appealing, but waiting for the case to be certified as a class action might be too late for some heritage acts. Even though there are common questions of law and fact among the proposed class members, the court may deny a class certification. Keep in mind that the Allmans' case against Sony settled almost five years after being filed, but before the class was ever certified. Heritage artists should review closely their agreements to determine if they have to take any additional action to preserve their rights. Launching a full-blown audit may not be financially viable for many heritage artists, but at a minimum they should immediately begin objecting in writing to the royalty rate paid for digital downloads. For those who have the financial resources, artists should comply with the contract objection provision, send notice of an audit and perhaps even send a tolling agreement to the label to freeze the contract-imposed limitations period. The Allman Brothers tried the tolling provision route first with UMG, but the major refused to freeze the limitations period, prompting the band to file suit. Although UMG has repeatedly discounted the Eminem decision as only applying to the particular facts of that case, it's anticipated that the Ninth Circuit decision will spur many heritage artists to start the litigation process to preserve their rights. Tactically speaking, individual suits may be more effective than a class action because the labels' efforts will be divided in defending the suits. Artists might want to investigate filing suit in the Northern District of California, where the James estate filed its case. If the rules of civil procedure are met, the court may consider a "joinder" of cases in lieu of a class action, potentially giving named plaintiffs more control over the terms of a settlement than under a class action. In the event of a joinder, only plaintiffs named in the lawsuit may recover damages. Either way, time is of the essence. Heritage artists interested in pursuing a higher royalty rate on digital downloads should act quickly as windows of opportunity are closing each year. Tamera H. Bennett is an entertainment and intellectual property attorney based in Lewisville, Texas. * Wisconsin Investment Board to Hire Class Action Firm ------------------------------------------------------ The Euromoney Institutional Investor, citing Pensions & Investments, reports that the State of Wisconsin Investment Board, Madison, is seeking to hire a firm to provide class-action securities litigation services. SWIB, which oversees $83.3 billion, requires assistance in evaluating and managing the impact of securities class-action litigation on its holdings of publicly traded securities. The selected firm will determine what action, if any, is beneficial for SWIB to take in securities class actions, provide notice of securities class action litigation and estimate damages to SWIB's investment portfolio. 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