/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/110728.mbx C L A S S A C T I O N R E P O R T E R Thursday, July 28, 2011, Vol. 13, No. 148 Headlines ALLIANT SOUTHSIDE: Sued by Tenants Over Rodent Infestation BANK OF NEW YORK: Sued for Assigning Fictitious FX Rates BANNER SUPPLY: Judge Seeks More Info on Class Action Settlement CATHOLIC HEALTH: Mothers of Stolen Babies Mull Class Action CITIMORTGAGE INC: Accused of Breaching Contracts in New York CONAGRA FOODS: Faces Class Actions Over Wesson Cooking Oils FEDERAL INSURANCE: Asked to Pay Osmond Class Action Settlement HARRISBURG, PA: Court Weighs on Howard Day Settlement LOS ANGELES, CA: Telephone Tax Class Action May Proceed METRO: Short-Statured Population May File Class Action METROPOLITAN WATER: Sued Over July 2010 Flood in Cook County, IL NOVO NORDISK: Faces Wage & Hour Overtime Class Action in Calif. OREGONIAN PUBLISHING: Two Classes Seek to Revive Privacy Suit OTTAWA, CANADA: Further Mediation Expected for Flooding Suit PROGRESS ENERGY: Faces Securities Class Action in North Carolina SONY: Zurich American Refuses to Cover Class Action Costs TRAVELERS COS: Appeals in Asbestos-Related Suits Remain Pending TRAVELERS COS: Final Hearing in Antitrust Suit Set for Sept. 14 WHIRLPOOL CORP: Reports $306-M Expense in Embraco Matters in June ZOO ENTERTAINMENT: Faces Securities Class Action in Ohio ********* ALLIANT SOUTHSIDE: Sued by Tenants Over Rodent Infestation ---------------------------------------------------------- Larry Blankenship, Roderick James, Antoinette Hudson, Yvette Willis, individually and on behalf of all others similarly situated v. Southside Preservation Portfolio, LLC, et al.; The Woodlawn Organization; Woodlawn Community Development Corporation; Kass Management Services, Incorporated; and EF&A Funding d/b/a Alliant Capital, LLC a/k/a/ Alliant Southside, LLC, Case No. 2011- CH-25778 (Ill. Cir. Ct., Cook Cty., July 22, 2011) is a class action complaint brought by Chicago tenants against their landlords. Their landlords are five corporate Defendants who, despite receiving large sums of money from the federal, state, and city governments, relegate their tenants to living in squalor, surrounded by rodent and insect infestations, the complaint alleges. The Plaintiffs are also accusing the Defendants of mismanaging security deposits and failing to provide the required summaries of the Chicago Residential Landlord Tenant Ordinance. The Plaintiffs are residents of Chicago, Illinois, and has leased apartments owned or managed by the Defendants. Southside is an inactive Illinois limited liability company and a wholly owned subsidiary and affiliate of Woodlawn. Prior to its involuntary dissolution by the state of Illinois, Southside was the owner and manager of the Leased Properties. Woodlawn is a not for profit Illinois corporation, and the owner and controlling interest of Southside. The Woodlawn Organization is a not for profit Illinois corporation, and the owner of, and has controlling interest in, Woodlawn. KASS is an Illinois corporation, and following the involuntary dissolution and foreclosure of Southside, became the manager and owner of the Leased Properties. EF&A is a limited liability company based in Michigan, and the successor-in-interest to Southside following its foreclosure and involuntary dissolution. Alliant is now the owner and manager of the Leased Properties. The Plaintiffs are represented by: Berton N. Ring, Esq. BERTON N. RING, P.C. 123 West Madison Street, 15th Floor Chicago, IL 60602 Telephone: (312) 781-0290 Facsimile: (312) 781-0390 BANK OF NEW YORK: Sued for Assigning Fictitious FX Rates -------------------------------------------------------- Courthouse News Service reports that in a federal class action, a union pension fund accuses The Bank of New York Mellon of "assigning fictitious foreign currency exchange rates to the Class' purchase and sales of foreign securities . . . for the exclusive pecuniary benefit" of the bank. A copy of International Union of Operating Engineers, Stationary Engineers Local 39 Pension Trust Fund v. The Bank of New York Mellon Corporation, et al., Case No. 11-cv-03620 (N.D. Calif.), is available at: http://www.courthousenews.com/2011/07/25/BNYMellon.pdf The Plaintiff is represented by: Richard M. Heimann, Esq. Lexi J. Hazam, Esq. Robert L. Lieff, Esq. LIEFF, CABRASER, HEIMANN & BERNSTEIN, LLP Embarcadero Center West 275 Battery Street, 29th Floor San Francisco, CA 94111-3339 Telephone: (415) 956-1000 E-mail: rheimann@lchb.com lhazam@lchb.com rlieff@lchb.com - and - Michael P. Lehmann, Esq. Christopher L. Lebsock, Esq. HAUSFELD LLP 44 Montgomery Street, 34th Floor San Francisco, CA 94104 Telephone: (415) 633-1908 E-mail: mlehmann@hausfeldllp.com clebsock@hausfeldllp.com - and - Michael D. Hausfeld, Esq. William P. Butterfield, Esq. Ralph J. Bunche, Esq. HAUSFELD LLP 1700 K Street, NW Suite 650 Washington, DC 20006 Telephone: (202) 540-7200 E-mail: mhausfeld@hausfeldllp.com wbutterfield@hausfeldllp.com - and - Steven E. Fineman, Esq. Daniel P. Chiplock, Esq. Michael J. Miarmi, Esq. LIEF, CARBRASER, HEIMANN & BERNSTEIN, LLP 250 Hudson Street, 8th Floor New York, NY 10013-1413 E-mail: sfineman@lchb.com dchiplock@lchb.com mmiarmi@lchb.com - and - Michael P. Thornton, Esq. Michael A. Lesser, Esq. THORNTON & NAUMES LLP 100 Summer Street, 30th Floor Boston, MA 02110 Telephone: (617) 720-1333 E-mail: mthornton@tenlaw.com mlesser@tenlaw.com - and - Gregory S. Hach, Esq. Michael A. Rose, Esq. Frank R. Schirripa, Esq. HACH ROSE SCHUMACHER SCHIRRIPA & CHEVERIE LLP 185 Madison Avenue, 14th Floor New York, NY 10016 Telephone: (212) 213-8311 E-mail: ghach@hrssclaw.com mrose@hrssclaw.com fschirripa@hrssclaw.com - and - Michael Schumacher Jr., Esq. HACH ROSE SCHUMACHER SCHIRRIPA & CHEVERIE LLP 44 Montgomery Street, 34th Floor San Francisco, CA 94104 Telephone: (415) 745-0966 BANNER SUPPLY: Judge Seeks More Info on Class Action Settlement --------------------------------------------------------------- The Associated Press reports that a South Florida judge has ruled that a Miami-based supplier of tainted Chinese drywall must disclose more details about a proposed $55 million class-action settlement. A Broward County judge ruled on July 25 that Banner Supply Co. must release more information about its insurance coverage and assets. It must also disclose the number of victims and how the money will be split. A federal judge in New Orleans gave preliminary approval of the class-action settlement earlier this month. Attorney David Durkee says the South Florida decision could potentially help thousands decide whether to take the settlement or pursue separate lawsuits in Florida. Lawsuits claim Banner Supply sold more than a million sheets of Chinese drywall. It contains harmful toxins that corrode pipes and electrical wiring, emit sulfur gases and cause health problems. CATHOLIC HEALTH: Mothers of Stolen Babies Mull Class Action ----------------------------------------------------------- Donna Sharpe, writing for Newcastle Herald, reports that Therese Pearson, of Merewether, and Juliette Clough, of Windale, agree that nothing will ease the decades of pain they have endured and they want to launch a class action against the organization that drugged them and "stole" their babies. The women agree that Monday's apology from Catholic Health Australia is too little too late and nothing more than a strategy to shut them up and make them go away. As young girls both women were drugged, forced to sign adoption papers and their babies were "stolen" from them, an act that made them feel like dirt, affected their lives and the lives of their loved ones. They thought they would receive personal apologies from Catholic Health Australia, but instead learned of the apology from the media. "This has done little to relieve any of our pain," Ms. Clough said. "It has validated their wrongdoing but it's not liberating us the victims. "I really want to pursue a class action now." Ms. Clough's baby boy was taken from her in 1969 when she was 15. Her mother had committed suicide, her father did not want the responsibility of children and the Catholic Church put her in a home where she was raped and fell pregnant. She delivered a boy she named Richard at the Mater Hospital, Waratah. "My legs were tied in stirrups, I was drugged and didn't know what was going on and I don't remember signing any papers for adoption," she said. Ms. Clough's son is now 41 and believed to be living in the Northern Territory. She has been unsuccessful in contacting him. Ms. Pearson, who also delivered a son, said as a young Catholic girl she was an embarrassment to her family. She was an unwed 19-year-old in 1964 when she was coerced into adopting out her baby. "I didn't even know if I had a son or a daughter because pillows were held over my face and stomach when he was born," she said. She later made contact with her son, a Canberra businessman named Peter, in 1996. "I have mixed thoughts about [Mon]day's announcement. I think they just want to shut us up. "It certainly hasn't given us back all those lost years." Ms. Pearson said a recent inquiry into the Catholic Church and its adoption practices from the 1950s to the 1970s has only scratched the surface of a worldwide problem. "There are many others like us," she said. Ms. Pearson has formed the Hunter arm of Origins, a group that offers support, healing and assistance with family reunions for those associated with adoption separation and secrecy. CITIMORTGAGE INC: Accused of Breaching Contracts in New York ------------------------------------------------------------ Daniel and Brenda Seller, on behalf of themselves and all others similarly situated v. CitiMortgage, Inc., Case No. 652001/2011 (N.Y. Sup Ct. July 22, 2011) is brought to challenge Citi's failure to honor its uniform written agreements with borrowers to modify mortgages and prevent foreclosures under the federal Home Affordable Modification Program. The Plaintiffs allege common law claims for breach of contract, breach of the implied covenant of good faith and fair dealing and promissory estoppel and statutory violations under the New York General Business Law. The Sellers are residents of Westchester County, New York. They have a mortgage from Citi for their primary residence located at 12 Hemlock Drive, in Lincolndale, New York. Citi is a New York corporation, authorized to transact business in New York. Citi is the fourth largest mortgage service provider in the United States of America. The Plaintiffs are represented by: Oren Giskan, Esq. Catherine E. Anderson, Esq. GISKAN SOLOTAROFF ANDERSON & STEWART LLP 11 Broadway, Suite 2150 New York, NY 10004 Telephone: (212) 847-8315 E-mail: ogiskan@gslawny.com canderson@gslawny.com - and - Richard Wolfson, Esq. RICHARD WOLFSON P.C. 100 Ring Road West, Suite 214 Garden City, NY 11530 Telephone: (516) 220-1380 - and - Keith Scott Lederman, Esq. THE LAW OFFICE OF KEITH SCOTT LEDERMAN 100 Ring Road West, Suite 214 Garden City, NY 11530 Telephone: (516) 806-4363 E-mail: ktlederman@aol.com CONAGRA FOODS: Faces Class Actions Over Wesson Cooking Oils ----------------------------------------------------------- Western Farm Press reports that class action suits filed in federal courts in New York and California allege that ConAgra Foods is violating state consumer protection and business practices laws by claiming that its Wesson cooking oils are "100 percent natural." The claim is misleading, the complaints argue, because the oils come from "unnatural" biotech corn, canola and soybeans. The lawyers asked the courts to find that the labeling claims are misleading and award an undetermined amount of money to their clients and all other consumers who bought the oils, believing that they were "natural" and not derived from genetically modified crops. The suit contends that the oils are not 100 percent natural, citing a definition by the World Health Organization of GMOs as "organisms in which the genetic material has been altered in a way that does not occur naturally." It alleges that the claims violate California and New York false advertising and unfair competition laws and business codes. FEDERAL INSURANCE: Asked to Pay Osmond Class Action Settlement -------------------------------------------------------------- Courthouse News Service reports that The Screen Actors Guild demands $330,000 from Federal Insurance Co., claiming it refused in bad faith to pay the settlement of Ken Osmond's (Eddie Haskell's) class action on residuals. HARRISBURG, PA: Court Weighs on Howard Day Settlement ----------------------------------------------------- Matt Miller, writing for The Patriot-News, reports that four public housing tenants who sued the Harrisburg Housing Authority, saying they fear for their lives after being displaced by renovations at the William Howard Day Homes, might soon be going home. At least 100 other families affected by the ongoing modernization project will have the same choice if a federal judge approves a proposed settlement of the class-action case. The accord being weighed by U.S. Middle District Chief Judge Yvette Kane requires that all Howard Day residents who were or might be ousted by the renovation work be given the chance to return to the complex off North Cameron Street. The residents who sued the authority claimed their rights were being trampled because displaced Howard Day residents weren't being allowed to return after being moved to other complexes, including Hall Manor and Hoverter Homes, which they claimed are more crime-ridden and dangerous. "I would not say the plaintiffs got everything they were hoping for, but it is a good result that will provide real help to these people," Kevin Quisenberry of the Community Justice Project said of the proposed accord. Irwin W. Aronson, the authority's lawyer, on July 21 said that the agency always intended to give displaced Howard Day tenants first dibs on returning to renovated apartments. "Our concern all along has been to avoid to the greatest degree possible the displacement of people who don't want to be displaced," Mr. Aronson said. However, some relocations are unavoidable given the scope of the renovations, he said. The $10 million-plus project has been going on at the 70-year-old, 244-unit complex for years and is expected to take several more years to complete. Despite the claims in the tenants' suit, the authority "always follows the law," Mr. Aronson said. The court battle erupted in February when Kadejah Holton, Christine Brooks, Kiesha Maclin and Elizabeth Whitley -- three single mothers and a disabled senior citizen -- sued the agency, claiming it was violating federal law by displacing them for renovations and not allowing them to return to Howard Day. The suit was declared a class-action on behalf of all Howard Day residents in March. Ms. Maclin claimed in the suit that, while she felt safe in her Howard Day apartment, she is afraid to allow her 6-year-old daughter to play outside at Hall Manor. Ms. Wiley said a shooting occurred outside her Hoverter Homes apartment a week after she moved in. Ms. Brooks claimed she and her three children have seen gunfights since moving to Hall Manor in mid-2009 and that a bullet hit her front window last summer. The women contended that their unwilling moves also upset their transportation, school, day care and even medical care arrangements. They argued that the authority was violating the law by not offering displaced Howard Day residents more housing options or adequate moving assistance and by not permitting them to return home as renovated units became available. The proposed resolution to the Harrisburg suit would require the authority to give every displaced family the right of first refusal on returning to a renovated unit at Howard Day. It would require that "reasonable" moving expenses be provided to those who have to relocate at least temporarily. The authority would be barred from leasing renovated Howard Day units to new occupants before all displaced residents decide whether to return. LOS ANGELES, CA: Telephone Tax Class Action May Proceed ------------------------------------------------------- Los Angeles Times reports that a class action lawsuit against the city of Los Angeles for a refund of potentially hundreds of millions of dollars in telephone taxes may proceed as a result of a unanimous ruling on Monday by the California Supreme Court. The ruling, written by Justice Ming W. Chin, upheld the right of citizens to bring class actions against municipal governments for collection of allegedly illegal taxes. The decision will affect similar lawsuits against Los Angeles County, Long Beach and Chula Vista, lawyers in the case said. The suits claim that the governments have illegally taxed telephone users. The tax appears on phone bills. The case against L.A. was filed in 2006. The city argued that the taxpayers should have filed individual claims for refunds before bringing a class action and won in the trial court and the appeals court. As a result of Monday's ruling, "It's possible we will consider bringing actions against other jurisdictions," said Frank Gregorek, who argued the case for the taxpayer. The class that would recover funds would include all residents who paid the taxes. During the years at which the suit is aimed, L.A. charged users a 10% tax on their phone bills, he said. City voters later approved the tax but lowered it to 8%, he said. An attorney for the city was unavailable for comment. METRO: Short-Statured Population May File Class Action ------------------------------------------------------ Nick Leys, writing for Herald Sun, reports that train operator Metro has come under attack from Melbourne's short-statured population, who claim they are being left with nowhere to sit and nothing to hang on to. Metro this week rolled out modified carriages with some seats removed to create more standing room. But for anyone who can't reach an overhead handle, or push through a crowded carriage to grab a handrail, life has become just a little bit harder. Local members of the Short Statured People of Australia have condemned the change, saying it is just one more reason not to use public transport. Samantha Lilly, 22, said the thought of entering a crowded carriage with little hope of a seat was "just horrible". "My face is at bottom height, so a crowded train is horrendous," the 112cm university student said. "It's quite scary. People don't know you are there and if they step back you can get trampled. "If people can see you and know your intentions they let you through, but if they can't move they can't let you through anyway." Trams are just as frustrating. Several years ago Ms. Lilly was fined for not having a ticket, but she could not reach the vending machine. "A lot of us have that problem," she said. "When I argued with them they told me to ask a stranger to buy a ticket for me. Eventually they dropped the fine, but I thought things would change. They haven't." Sam Millard, 23, is 120cm and also a university student. He stopped using public transport because he decided it was unsafe. "The hardest thing is getting on and off," Mr. Millard said. "When things are really crowded it can be dangerous and you get bumped around." Mr. Millard and Ms. Lilly are attempting to take a class action against Metro. Metro spokeswoman Geraldine Mitchell said the removal of seats would improve access to handrails. "Our assessment of the congestion near the door areas has proven there is limited access to handrails for all heights," she said. "This change will ease congestion and improve customer flow, providing better access to handrails." Metro is removing the third aisle seat in 48 trains in the X'Trapolis fleet, meaning every six-car X'Trapolis train will have 72 fewer seats -- down from 528 to 456. METROPOLITAN WATER: Sued Over July 2010 Flood in Cook County, IL ---------------------------------------------------------------- Jenice Hampton, Sharon Banks-Revis, Claire Batherson, Mark Batherson, Theresa Becton, Maurice Brewster, Kimberly Davidson, Claudia Duncan, Ju Wanna L. Elery, Nancy Elery, Valencia Goodlow, Renita Grimes, Venetta Johnson, Frank Koob, Johnnie Mcclinton, Marla Mcelroy, Carrier Navarra, Janice O'connor, Lavern Partee, Jarvis Revis, Terry Revis, David Roselund, Cassandra Sanders, Kimberly Suttle, Anita Thomas, Martha Turner, Michael Turner, Geraldine Ward, Joseph Ward, Roy White, Sr., Kitty Williams, Isabelle Wright, and Lenette Yarbar, each individually and on behalf of a class of similarly situated persons v. Metropolitan Water Reclamation District of Greater Chicago, Case No. 2011-CH- 25822 (Ill. Cir. Ct., Cook Cty., July 22, 2011) is brought in connection with the MWRD's activities, including pumping of stormwater and closing floodgates, after Cook County experienced a heavy rainfall event on July 23 and 24, 2010. The Plaintiffs allege that their private property was taken and damaged by the MWRD for public use without just compensation, in violation of the Illinois Constitution. Therefore, the Plaintiffs are asking for compensatory damages in excess of $50,000. The Plaintiffs are residents of Cook County, Illinois, each being a landowner or renter of real property located in Cook County, Illinois. The MWRD is a Cook County local public entity created by the "Metropolitan Water Reclamation District Act." The MWRD plans, manages, implements and finances activities relating to stormwater management, including management of floods and floodwaters, in Cook County. The Plaintiffs are represented by: Glen J. Dunn, Jr., Esq. GLEN J. DUNN & ASSOCIATES, LTD. 35 East Wacker Drive, Suite 650 Chicago, IL 60601 Telephone: (312) 546-5056 Facsimile: (312) 546-5058 E-mail: gdunn@gjdlaw.com - and - Jeffrey Grant Brown, Esq. JEFFREY GRANT BROWN, P.C. 35 East Wacker Drive, Suite 650 Chicago, IL 60601 Telephone: (312) 789-9700 Facsimile: (312) 782-4519 NOVO NORDISK: Faces Wage & Hour Overtime Class Action in Calif. --------------------------------------------------------------- Blumenthal, Nordrehaug & Bhowmik on July 25 disclosed that on May 18, 2011, the employment law attorneys at the firm filed a class action lawsuit against pharmaceutical company Novo Nordisk on behalf of drug sales reps for alleged overtime wage and hour violations. The overtime complaint against the pharmaceutical giant was filed in Sacramento Superior Court and is entitled Brown v. Novo Nordisk, Case No. 34-2011-00103639. According to the wage and hour class action complaint filed against the drug company, Novo Nordisk violated California overtime laws by failing to pay pharmaceutical sales representatives for overtime hours worked. Under California law, companies are required to pay all non-exempt employees overtime compensation whenever the employees work more than eight hours in a day or forty hours in a week. The primary requirement to satisfy the outside salesperson exemption and not get paid overtime under California law and the Fair Labor Standards Act is that the sales reps are actually making sales. In the Novo Nordisk overtime class action lawsuit, the pharmaceutical sales reps allege that they were not actually making sales but rather promoting prescription drugs to physicians. At most, the physician can agree to prescribe the medicine to patients as needed, but cannot actually buy the prescription medicine from the pharmaceutical sales reps directly. The drug sales rep overtime class action suit is one of many that has been recently filed against pharmaceutical companies. The California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik are also representing pharma sales reps in overtime class action suits against Merck (Frudakis v. Merck, Case No. SACV11- 00146 in the Central District of California) and Schering-Plough (Valadez v. Schering-Plough, Case No. 10-CV-2595 in the Southern District of California). The class action lawsuits all allege that the pharmaceutical sales reps should be paid overtime compensation for working more than eight hour days under the California Labor Code and/or forty hour weeks under the Fair Labor Standards Act based on the contention that the drug sales reps do not qualify for the outside salesperson exemption because they are not actually making sales. For more information about the pharmaceutical sales rep class action suit against Novo Nordisk, visit the Novo Nordisk California wage and hour class action suit Web site or call (866) 771-7099. The California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik represent employees in class action and individual lawsuits involving unpaid overtime, wage and hour violations, wrongful termination, job harassment, discrimination and other illegal employment law violations. OREGONIAN PUBLISHING: Two Classes Seek to Revive Privacy Suit ------------------------------------------------------------- June Williams at Courthouse News Service reports that two classes urged the United States Court of Appeals for the Ninth Circuit to revive their lawsuits against several companies including the publishers of The Oregonian newspaper that allegedly violated federal law to obtain personal information about Washington and Oregon residents. The classes had accused the companies of using bulk requests to obtain and "stockpile" their information for later use, which is not allowed under the Driver's Privacy Protection Act. Last year, federal judges dismissed the claims against Ampco Parking Systems, Automotive.com and Members Only in the Washington case, and Oregonian Publishing, Criminal Information Services and Western Mercantile Agency in the Oregon case. Both cases were dismissed for failure to state a claim. In her order dismissing the Washington case, U.S. District Judge Marsha J. Pechman said the plaintiff's "threadbare complaint" failed to show the information was obtained for an improper purpose. Amended complaints that were filed in both actions were also dismissed. Arguing for the Oregonian class before the appellate panel on July 12, Dallas-based attorney Thomas Corea had difficulty convincing the judges that the consolidated appeal presented a different issue from Taylor v. Acxiom in which the United States Court of Appeals for the Fifth Circuit approved the legality of bulk obtainment. Judge Richard Clifton called it "exactly the same case." "It seems to me you may be saying that Taylor is wrongly decided or Taylor shouldn't be applied in the context of your plaintiffs' claim, but I'm having real trouble figuring out how what happened in Texas is any different than what happened in Oregon or Washington," Judge Clifton said. "You just don't like the result in Texas," he added. Mr. Corea responded that Taylor focused on improper use under the Driver's Privacy Protection Act, but this case was about improper obtainment. He said that the defendants obtained the bulk files for convenience and "stockpiling," while misrepresenting that they had a "present purpose" for the information. Judge Clifton said that the federal courts said this argument was "not a viable legal theory." "The courts have decided stockpiling is not illegal," he said. Judge Edward Korman said Mr. Corea was "just trying to bootstrap an argument that doesn't fly." An attorney for the Oregonian publisher and other defendants said the class had "absolutely no facts" to support their claims that the driver's license information was improperly obtained. "His only theory of improper purpose is this theory of stockpiling," Charles Hinkle with Stoel Rives said. Judge N. R. Smith said that if stockpiling was prohibited, then companies would have to destroy the record after one use. "So it would be an absurd result to suggest that stockpiling is an improper purpose," he said. OTTAWA, CANADA: Further Mediation Expected for Flooding Suit ------------------------------------------------------------ Neco Cockburn, writing for The Ottawa Citizen, reports that a lawsuit launched against the City of Ottawa after west-side homes were flooded nine years ago is still making its way through court, even as more legal action is taken over further flooding and the city works to fix the problem. Derek Nicholson, a lawyer representing 77 plaintiffs who suffered property damage when sanitary and storm sewers in Glen Cairn overflowed during a storm on June 27, 2002, said a settlement in the case has not been reached despite two mediation sessions. The lawsuit was certified by a judge as a class-action on March 21, 2005. Mr. Nicholson said he offered in October 2009 to settle out of court for C$1.7 million, which he said represented 80% of the residents' actual losses. The offer remains on the table, he said. Mr. Nicholson said he expects further mediation within months, adding that he hopes to set a trial date. Even then, "I'd expect (the trial date) would be eight months to a year from now," he said. Insurance companies and "lay people" are involved in the lawsuit, but Mr. Nicholson said he fears some residents "just gave up" or didn't get involved because of the amount of time it has taken. The city would not comment on the case and a lawyer for an engineering firm that was added as a defendant could not be reached for comment. As that case continues, more court action has been taken over flooding on July 24, 2009, when nearly 1,500 west-side basements were damaged following heavy rain. The city has within the last two months denied more than 875 claims received from property owners and insurance companies after that flooding, and at least two lawsuits have followed. Plaintiffs in the lawsuits seek a total of almost C$2 million, and one of the cases appears to open the door for a class action. Statements of claim allege the city was negligent and failed to properly inspect, repair or maintain its sewer and drainage systems. None of the allegations have been proven in court. City legal staff provided in a staff report in May a legal analysis that's to be used for the city's defense in at least one of the cases, but declined to comment on the lawsuits. The staff report generally found rainfall and high water levels overwhelmed the sewer and drainage system, and sewer backups, overflows at two sewage pumping stations and seven culvert failures contributed to that flooding. After several solutions were recommended, council approved the C$32-million "West-End Flooding Investigation Action Plan" that's meant to reduce the risk of flooding through improvements to pumping stations, drainage and sewer systems. Some of that work has started, said Kanata South Councillor Allan Hubley, who's now lobbying the Insurance Bureau of Canada to try to get insurance rates lowered for people in his ward. Mr. Hubley, who was elected in October, said he came to office promising that work would be done to mitigate the risk of flooding, and "the other part of it was the insurance rates." Mr. Hubley said 600 to 800 homes in the K2L postal area were flooded, but about 6,500 residences are within the postal code and most of them are also getting higher rates or deductibles "because the companies set the rates based on a postal code." "Even though it's just several hundred homes within the postal code that are flooded in my ward's case, there are thousands of homes impacted by this. Their insurance rates have gone up various degrees" because they're deemed to be in a higher-risk area, he said. Mr. Hubley said he hopes to meet with insurance bureau officials within the next few months. He wants to show insurance companies that the city has come up with causes and is implementing solutions to the flooding, "and then they can reassess the risk based on this new knowledge," which hopefully leads to lower rates, he said. PROGRESS ENERGY: Faces Securities Class Action in North Carolina ---------------------------------------------------------------- Levi & Korsinsky, LLP disclosed that on July 18, 2011, it commenced a class action lawsuit in the United States District Court, Eastern District of North Carolina (case no. 4:11-cv-00120- D) on behalf of purchasers of Progress Energy, Inc. who purchased shares between January 8, 2011, and July 19, 2011. The Complaint alleges, among other things, that Progress Energy and its Board of Directors unfairly deprived shareholders of the true value of the Company by entering into a definitive merger agreement with Duke Energy Corporation, wherein Progress Energy shareholders will receive 2.6125 shares of Duke Energy common stock for each share of Progress Energy stock they own, violated their fiduciary duties to shareholders, and violated Section 14(a) of the Securities Exchange Act of 1934 by omitting material disclosures and providing misleading disclosures in its Proxy. If you are a member of the class and own Progress Energy stock purchased during the above period, you have 60 days from the date of this notice to request that the Court appoint you as lead plaintiff. To obtain additional information or a copy of the complaint, contact Eduard Korsinsky, Esq. either via e-mail at ek@zlk.com or by telephone at (877) 363-5972, or visit http://www.zlk.com/progress-energy-pgn.html Levi & Korsinsky has expertise in prosecuting investor securities litigation and extensive experience in actions involving financial fraud and represents investors throughout the nation, concentrating its practice in securities and shareholder litigation. CONTACT: Eduard Korsinsky, Esq. Levi & Korsinsky, LLP 30 Broad Street - 15th Floor New York, NY 10004 Telephone: (212) 363-7500 Toll Free: (877) 363-5972 Web site: http://www.zlk.com SONY: Zurich American Refuses to Cover Class Action Costs --------------------------------------------------------- Ericka Chickowski, writing for Dark Reading, reports that a new court battle reported last week could potentially decide how liability is determined when organizations covered by general liability insurance get hacked and suffer a database breach. The case at hand pits insurer Zurich American against its client Sony: Zurich has refused to cover the costs of class-action lawsuits stemming from Sony's embarrassing breaches earlier this year, and wants the courts to weigh in with a judgment to clarify the matter. Sony says it expects the financial fallout from the breaches to add up to more than $178 million this year; the firm is currently fighting 55 class action lawsuits. According to a report from Reuters, Zurich recently stated in court papers that it had received claims from Sony to cover costs related to these lawsuits under a general liability insurance policy written by Zurich. The insurer says it shouldn't have to pay the claim since the policy is for "bodily injury, property damage, or personal and advertising injury," and none of those apply within the class- action suits. Given the rising prevalence of data breaches and the increasing storm of litigation companies face from customers furious about their loss of privacy, this case is a must-follow precedence- setter for professionals in IT security and enterprise risk management. Ty Sagalow, an insurance consultant and founder of Innovation Insurance Group, says there are still many within the industry who are under the mistaken assumption that general liability policies will help them out in the event of a data breach. "There are probably still some risk managers out there that think that their comprehensive general liability policy cover breaches," says Mr. Sagalow, who was one of the main experts in charge of first drafting cyberinsurance policies for Zurich when he worked for the company prior to starting his own consulting shop. "These types of cyberevents are not covered in the typical standard forms of insurance." Mr. Sagalow says that as cyber-risks increase in sophistication and pervasiveness, organizations need to think about adding additional coverage that can hold up to court scrutiny when everything hits the fan. But because cyberinsurance is such a new phenomenon, it's a buyer-beware situation. "Unlike many insurance policies that companies buy, there is no standard form -- it's not like comprehensive general liability or workman's comp or fleet auto -- cyber is not standard," Mr. Sagalow says. "Plus, it is in an area which is called surplus insurance, meaning that they're not subject to state filing regulations for state approval, which allows freedom of an insurance carrier to set terms and conditions." This means that organizations considering cyberpolicies have to read very carefully before signing on the dotted line, says Rick Kam, president and founder of consultancy ID Experts, a firm that helps with pre- and post-breach strategy. He says that companies often buy cyberinsurance expecting it to cover breaches, only to discover after an event that the insurance is primarily for instances such as denial-of-service attacks. "Insurance has to be very specific to cover those issues related to a data breach," Mr. Kam says. "One of the major tips I would suggest is to have their enterprise risk manager -- the person responsible for their insurance policies -- meet with their insurers to validate what's covered and what's not when it comes to a breach." TRAVELERS COS: Appeals in Asbestos-Related Suits Remain Pending --------------------------------------------------------------- Appeals in asbestos-related lawsuits against The Travelers Companies, Inc., remain pending, according to the Company's July 21, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2011. In October 2001 and April 2002, two purported class action lawsuits (Wise v. Travelers and Meninger v. Travelers) were filed against Travelers Property Casualty Corp. (TPC) and other insurers (not including The St. Paul Companies, Inc. (SPC)) in state court in West Virginia. These and other cases subsequently filed in West Virginia were consolidated into a single proceeding in the Circuit Court of Kanawha County, West Virginia. The plaintiffs allege that the insurer defendants engaged in unfair trade practices in violation of state statutes by inappropriately handling and settling asbestos claims. The plaintiffs seek to reopen large numbers of settled asbestos claims and to impose liability for damages, including punitive damages, directly on insurers. Similar lawsuits alleging inappropriate handling and settling of asbestos claims were filed in Massachusetts and Hawaii state courts. These lawsuits are collectively referred to as the Statutory and Hawaii Actions. In March 2002, the plaintiffs in consolidated asbestos actions pending before a mass tort panel of judges in West Virginia state court amended their complaint to include TPC as a defendant, alleging that TPC and other insurers breached alleged duties to certain users of asbestos products. The plaintiffs seek damages, including punitive damages. Lawsuits seeking similar relief and raising similar allegations, primarily violations of purported common law duties to third parties, have also been asserted in various state courts against TPC and SPC. The claims asserted in these lawsuits are collectively referred to as the Common Law Claims. The federal bankruptcy court that had presided over the bankruptcy of TPC's former policyholder Johns-Manville Corporation issued a temporary injunction prohibiting the prosecution of the Statutory Actions (but not the Hawaii Actions), the Common Law Claims and an additional set of cases filed in various state courts in Texas and Ohio, and enjoining certain attorneys from filing any further lawsuits against TPC based on similar allegations. Notwithstanding the injunction, additional common law claims were filed against TPC. In November 2003, the parties reached a settlement of the Statutory and Hawaii Actions. This settlement includes a lump-sum payment of up to $412 million by TPC, subject to a number of significant contingencies. In May 2004, the parties reached a settlement resolving substantially all pending and similar future Common Law Claims against TPC. This settlement requires a payment of up to $90 million by TPC, subject to a number of significant contingencies. Among the contingencies for each of these settlements is a final order of the bankruptcy court clarifying that all of these claims, and similar future asbestos-related claims against TPC, are barred by prior orders entered by the bankruptcy court ("the 1986 Orders"). On August 17, 2004, the bankruptcy court entered an order approving the settlements and clarifying that the 1986 Orders barred the pending Statutory and Hawaii Actions and substantially all Common Law Claims pending against TPC ("the Clarifying Order"). The Clarifying Order also applies to similar direct action claims that may be filed in the future. On March 29, 2006, the U.S. District Court for the Southern District of New York substantially affirmed the Clarifying Order while vacating that portion of the order that required all future direct actions against TPC to first be approved by the bankruptcy court before proceeding in state or federal court. Various parties appealed the district court's March 29, 2006 ruling to the U.S. Court of Appeals for the Second Circuit. On February 15, 2008, the Second Circuit issued an opinion vacating on jurisdictional grounds the District Court's approval of the Clarifying Order. On February 29, 2008, TPC and certain other parties to the appeals filed petitions for rehearing and/or rehearing en banc, requesting reinstatement of the district court's judgment, which were denied. TPC and certain other parties filed Petitions for Writ of Certiorari in the United States Supreme Court seeking review of the Second Circuit's decision, and on December 12, 2008, the Petitions were granted. On June 18, 2009, the Supreme Court ruled in favor of TPC, reversing the Second Circuit's February 15, 2008 decision, finding, among other things, that the 1986 Orders are final and generally bar the Statutory and Hawaii actions and substantially all Common Law Claims against TPC. Further, the Supreme Court ruled that the bankruptcy court had jurisdiction to issue the Clarifying Order. However, since the Second Circuit had not ruled on certain additional issues, principally related to procedural matters and the adequacy of notice provided to certain parties, the Supreme Court remanded the case to the Second Circuit for further proceedings on those specific issues. On October 21, 2009, all but one of the objectors to the Clarifying Order requested that the Second Circuit dismiss their appeal of the order approving the settlement, and that request was granted. On March 22, 2010, the Second Circuit issued an opinion in which it found that the notice of the 1986 Orders provided to the remaining objector was insufficient to bar contribution claims by that objector against TPC. On April 5, 2010, TPC filed a Petition for Rehearing and Rehearing En Banc with the Second Circuit, requesting further review of its March 22, 2010 opinion, which was denied on May 25, 2010. On August 18, 2010, TPC filed a Petition for Writ of Certiorari in the United States Supreme Court seeking review of the Second Circuit's March 22, 2010 opinion, and a Petition for a Writ of Mandamus seeking an order from the Supreme Court requiring the Second Circuit to comply with the Supreme Court's June 18, 2009 ruling in TPC's favor. The Supreme Court denied the Petitions on November 29, 2010. The plaintiffs in the Statutory and Hawaii actions and the Common Law Claims actions filed Motions to Compel with the bankruptcy court on September 2, 2010, and September 3, 2010, respectively, arguing that all conditions precedent to the settlements have been met and seeking to require TPC to pay the settlement amounts. On September 30, 2010, TPC filed an Opposition to the plaintiffs' Motions to Compel on the grounds that the conditions precedent to the settlements, principally the requirement that all contribution claims be barred, have not been met in light of the Second Circuit's March 22, 2010 opinion. On December 16, 2010, the bankruptcy court granted the plaintiffs' motions and ruled that TPC was required to fund the settlements. On January 20, 2011, the bankruptcy court entered judgment in accordance with its December 16, 2010 ruling and ordered TPC to pay the settlement amounts plus prejudgment interest. On January 21, 2011, TPC filed an appeal with the U.S. District Court for the Southern District of New York from the bankruptcy court's January 20, 2011 judgment. On January 24, 2011, certain of the plaintiffs in the Common Law Claims actions appealed that portion of the bankruptcy court's January 20, 2011 judgment that denied their request for an order of contempt and for sanctions. The appeals are pending. SPC, which is not covered by the Manville bankruptcy court rulings or the settlements, is a party to pending direct action cases in Texas state court asserting common law claims. All such cases that are still pending and in which SPC has been served are currently on the inactive docket in Texas state court. If any of those cases becomes active, SPC intends to litigate those cases vigorously. SPC was previously a defendant in similar direct actions in Ohio state court. Those actions have all been dismissed following favorable rulings by Ohio trial and appellate courts. From time to time, SPC and/or its subsidiaries have been named in individual direct actions in other jurisdictions. The Company says it is not possible to predict legal outcomes and their impact on the future development of claims and litigation relating to asbestos and environmental claims. Any such development will be affected by future court decisions and interpretations, as well as changes in applicable legislation. Because of these uncertainties, additional liabilities may arise for amounts in excess of the current related reserves. In addition, the Company's estimate of ultimate claims and claim adjustment expenses may change. These additional liabilities or increases in estimates, or a range of either, cannot now be reasonably estimated and could result in income statement charges that could be material to the Company's results of operations in future periods. TRAVELERS COS: Final Hearing in Antitrust Suit Set for Sept. 14 --------------------------------------------------------------- A final fairness hearing on the settlement in the consolidated antitrust litigation against The Travelers Companies, Inc., is set for September 14, 2011, according to the Company's July 21, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2011. In 2005, four putative class action lawsuits were brought against a number of insurance brokers and insurers, including the Company, by plaintiffs who allegedly purchased insurance products through one or more of the defendant brokers. The plaintiffs alleged that various insurance brokers conspired with each other and with various insurers, including the Company, to artificially inflate premiums, allocate brokerage customers and rig bids for insurance products offered to those customers. To the extent they were not originally filed there, the federal class actions were transferred to the U.S. District Court for the District of New Jersey and were consolidated for pre-trial proceedings with other class actions under the caption In re Insurance Brokerage Antitrust Litigation. On August 1, 2005, various plaintiffs, including the four named plaintiffs in the class actions, filed an amended consolidated class action complaint naming various brokers and insurers, including the Company, on behalf of a putative nationwide class of policyholders. The complaint included causes of action under the Sherman Act, the Racketeer Influenced and Corrupt Organizations Act (RICO), state common law and the laws of the various states prohibiting antitrust violations. The complaint sought monetary damages, including punitive damages and trebled damages, permanent injunctive relief, restitution, including disgorgement of profits, interest and costs, including attorneys' fees. All defendants moved to dismiss the complaint for failure to state a claim. After giving plaintiffs multiple opportunities to replead, the court dismissed the Sherman Act claims on August 31, 2007, and the RICO claims on September 28, 2007, both with prejudice, and declined to exercise supplemental jurisdiction over the state law claims. The plaintiffs appealed the district court's decisions to the U.S. Court of Appeals for the Third Circuit. On August 16, 2010, the Third Circuit affirmed the district court's dismissal of all Sherman Act and RICO claims against certain defendants, including the Company, except for Sherman Act and RICO claims involving the sale of excess casualty insurance through a single defendant broker, as well as all state law claims, which they remanded to the district court for further proceedings. On October 1, 2010, defendants, including the Company, filed renewed motions to dismiss the remanded claims. On March 18, 2011, the Company and certain other defendants entered into an agreement with the plaintiffs to settle the lawsuit. The settlement, under which the Company agreed to pay $6.75 million, is subject to court approval. Preliminary approval of the settlement was granted on June 27, 2011, and a final fairness hearing is scheduled for September 14, 2011. WHIRLPOOL CORP: Reports $306-M Expense in Embraco Matters in June ----------------------------------------------------------------- As of June 30, 2011, Whirlpool Corporation has incurred expenses, including defense costs and other expenses, aggregating $306 million due to the Embraco antitrust matters, according to the Company's July 21, 2011, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended June 30, 2011. Government authorities in various jurisdictions are conducting antitrust investigations of the global compressor industry, including the Company's compressor business headquartered in Brazil ("Embraco"). In 2010, Embraco sales represented approximately 8% of the Company's global net sales. In February 2009, competition authorities in Brazil, the United States of America and Europe began to seek documents from the Company in connection with their investigations. A grand jury subpoena from the United States Department of Justice (the "DOJ") requested documents for the time period from 2003 to 2009. Competition authorities in other jurisdictions have sought similar information. In September 2009, the Brazilian competition commission (CADE) agreed to terminate the administrative investigation of the Company's compressor business. Under the terms of the settlement agreement, Whirlpool affiliates and certain executives located in Brazil acknowledged a violation of Brazilian antitrust law in the Brazilian compressor market by some Embraco employees. The settlement agreement provides for the affiliates to make contributions totaling 100 million Brazilian reais to a Brazilian government fund. The contributions translated to approximately $56 million, all of which was recorded within interest and sundry income (expense) in 2009. The payments are to be made in twelve semiannual installments of approximately $5 million through 2015. As of June 30, 2011, approximately $15 million has been paid. In September 2010, the DOJ and Embraco entered into a plea agreement related to the DOJ's investigation which was approved by the United States District Court for the Eastern District of Michigan in December 2010. Under the plea agreement, the DOJ recognized Embraco's substantial assistance in the investigation and agreed not to bring further charges against Embraco or any related entities for any conspiracy involving compressor pricing during the investigation period. Pursuant to the plea agreement, Embraco (1) acknowledged that it violated United States antitrust law with respect to the sale of certain compressors from October 2004 through December 2007, and (2) agreed to pay a fine totaling $91.8 million to the United States government. The full amount of the fine was recorded within interest and sundry income (expense) in the third quarter of 2010. Embraco made the first payment of $16.8 million in January 2011. The five remaining annual payments of $15.0 million plus interest will be made during each fourth quarter through 2015. Since the government investigations became public in February 2009, the Company has been named as a defendant in related antitrust lawsuits in various jurisdictions seeking damages in connection with the pricing of compressors from 1996 to 2009. Several other compressor manufacturers who are the subject of the government investigations have also been named as defendants in the litigation. United States federal lawsuits instituted on behalf of purported purchasers and containing class action allegations have been combined in one proceeding in the United States District Court for the Eastern District of Michigan. The Company continues to cooperate with ongoing government investigations in other jurisdictions, to defend the related antitrust lawsuits and to take other actions to minimize the Company's potential exposure. The final outcome and impact of these matters, and related claims and investigations that may be brought in the future are subject to many variables, and cannot be predicted. The Company establishes accruals only for those matters where the Company determines that a loss is probable and the amount of loss can be reasonably estimated. The Company has now accrued for a loss with respect to the investigation by the European Commission and certain other matters because, based on recent developments, a minimum loss amount can now be reasonably estimated. As of June 30, 2011, the Company has incurred, in the aggregate, charges of approximately $306 million due to the Embraco antitrust matters, including defense costs and other expenses. These charges have been recorded within interest and sundry income (expense) when incurred. At June 30, 2011, $209 million remains accrued. While it is currently not possible to reasonably estimate the aggregate amount of costs which the Company may incur in connection with these matters, such costs could have a material adverse effect on the Company's financial position, liquidity, or results of operations. ZOO ENTERTAINMENT: Faces Securities Class Action in Ohio -------------------------------------------------------- On July 22, 2011, a class action lawsuit was filed in the United States District Court for the Southern District of Ohio against Zoo Entertainment, Inc. The complaint alleges violations of federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, including allegations of issuing a series of material misrepresentations to the market which had the effect of artificially inflating the market price. The class period is from May 17, 2010, through April 15, 2011. Plaintiff seeks to recover damages on behalf of the Class. If you are a member of the Class, you may move the Court no later than Tuesday, September 20, 2011, to serve as a lead plaintiff for the Class. However, in order to do so, you must meet certain legal requirements pursuant to the Private Securities Litigation Reform Act of 1995. If you wish to discuss this action, participate in this or any other lawsuit, or have any questions or concerns regarding this notice, or preservation of your rights, please contact: William B. Federman, Esq. FEDERMAN & SHERWOOD 10205 North Pennsylvania Avenue Oklahoma City, OK 73120 Telephone: (405) 235-1560 E-mail: wbf@federmanlaw.com Web site: http://www.federmanlaw.com ********* 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, Joy A. Agravante, Julie Anne Lopez, 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 written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *