/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
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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. Interested candidates are
required to submit the applications by May 6, 2011.
*********
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. Leah
Felisilda, Noemi Irene A. Adala, Rousel Elaine Fernandez, Joy A.
Agravante, Ronald Sy, Christopher Patalinghug, Frauline Abangan
and Peter A. Chapman, Editors.
Copyright 2011. 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
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Information contained herein is obtained from sources believed to
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The CAR subscription rate is $575 for six months delivered via
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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 * * *