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C L A S S A C T I O N R E P O R T E R
Monday, August 8, 2011, Vol. 13, No. 155
Headlines
ALLSTATE CORP: Claims Processing in Contractors Suit Ongoing
ALLSTATE CORP: Summary Judgment Proceedings to Start in Early 2012
ALLSTATE CORP: Supreme Court Sends La. Suit Back to 5th Circuit
ALLSTATE CORP: Appeal in Worker Classification Suit Still Pending
ATLAS AIR: Still Defends Fuel Surcharges Manipulation Suits
BAXTER INT'L: Appeal From ERISA Suit Dismissal Still Pending
BAXTER INT'L: Continues to Defend Class Suit in Illinois
BAXTER INT'L: Discovery Still Ongoing in Plasma Therapies Suit
BECTON DICKINSON: 3rd Circuit Allows Appeal in Antitrust Suit
BLACK & DECKER: Fined $960T for Not Reporting Defective Trimmers
BRIDGEPOINT EDUCATION: Continues to Defend "Moore" Suit
BRIDGEPOINT EDUCATION: Continues to Defend "Rosendahl" Suit
BRIDGEPOINT EDUCATION: Still Defends "Sanchez" Suit in Calif.
BRIDGEPOINT EDUCATION: Still Defends "Stevens" Suit in Calif.
CADENCE DESIGN: Awaits Approval of $38-Mil. Securities Suit Deal
CAMERON INT'L: Awaits Final Report on Deepwater Horizon Accident
CARTER'S INC: 2nd Amended Complaint Filed in Consolidated Suit
CBS CORPORATION: Omaha Funds' Appeal From Dismissal Still Pending
CNO FINANCIAL: Appeal in "Ruderman" Suit Remains Pending
CNO FINANCIAL: Appeal in "Yue" Class Suit Remains Pending
CNO FINANCIAL: Consolidated Suit Trial Still Set for May 7, 2012
CNO FINANCIAL: Awaits Final OK of Annuity Marketing Suit Deal
CNO FINANCIAL: Plumbers and Pipefitters Union Suit Dismissed
CNO FINANCIAL: "Rowe" Suit Remains Pending in Illinois
COCA-COLA CO: Consolidated Georgia Class Suit Dismissed
COCA-COLA CO: Delaware Consolidated Class Suit Dismissed
COMCAST BUSINESS: Class Action Settlement Gets Preliminary Okay
COMMUNITY HEALTH: Defends Securities Class Suits in Tennessee
COMMUNITY HEALTH: Status Hearing Motion Pending in "Roswell" Suit
CONVERGYS CORP: Final Settlement Hearing Set for Sept. 27
E.I. DUPONT: Faces Numerous Class Actions Over Imprelis
ENCORE CAPITAL: Awaits Final OK of Deals Resolving Suits vs. Units
EQT PRODUCTION: Accused of Misleading Landowners on Settlement
GENWORTH FINANCIAL: Continues to Defend "Goodman" Suit
GERBER SCIENTIFIC: Signs MOU to Settler Merger-Related Suit
GREAT ATLANTIC: "LaMarca" Class Suit Remains Stayed
HARTE HANKS: Unit Set Up $7-Mil. Fund for "Gattuso" Suit Deal
HOTEL-BOOKING SITES: Get Favorable Ruling in New Jersey Tax Case
HSBC FINANCE: Awaits Court's Okay of Interchange Fees Suit Deal
HSBC FINANCE: Awaits Claims Admin. Completion in "Jaffe" Suit
HSBC FINANCE: Parties in Debt Cancellation Suits Working on Deal
HSBC USA: Awaits Ruling on Motion to Dismiss "Levin" Suit
HSBC USA: Continues to Defend Madoff-Related Suits
HUGOTON ROYALTY: XTO Continues to Defend "Fankhouser" Suit
HUGOTON ROYALTY: XTO Still Defends "Roderick" Suit in Kansas
HUMANA INC: Unit Continues to Defend "Sacred Heart" Suit
HUMANA INC: Wants to Eliminate Independent Pharmacies, Suit Says
HURONIA REGIONAL CENTRE: Ontario Gov't. Hinders Class Actions
ITRON INC: Still Faces Securities Class Suit in Washington
JIANGBO PHARMA: Milberg LLP Files Securities Class Action
JOHN DEMARCO: Ex-Workers File Class Action Over Unpaid Overtime
KINETIC CONCEPTS: Being Sold to Apax for Too Little, Suit Claims
KISSMETRICS: Faces Class Action Over Web Tracking Technology
LANDSTAR SYSTEM: Appeal From Denial of OOIDA Rehearing Pending
LIVE NATION: Files Suit Against Insurer Over Class Actions
M/I HOMES: Still Defending Class Suit on "Chinese Drywall" Claims
METROPOLITAN HEALTH: Faces 6 Merger-Related Suits in Florida
MORTON'S RESTAURANT: Deal to Settle Class Action in Calif. Pending
MORTON'S RESTAURANT: Jury Trial Scheduled for January 2012
NABORS INDUSTRIES: Final Hearing on "Denney" Deal Set for Sept. 8
NEWS OF THE WORLD: Silverman Sherliker Mulls Class Action
NEXTORCH INC: Recalls 16T Flashlight Batteries Due to Fire Hazard
NISOURCE INC: Suit Settlement Fund to Be Terminated Soon
NISOURCE INC: Gives $28.7-Mil. to "Thacker" Suit Settlement Fund
NORTHERN IRELAND: May Face Class Action Over Detention Policy
PILGRIM'S PRIDE: Reaches Verbal Pact to Settle Securities Suit
PILGRIM'S PRIDE: Awaits Ruling on Motion to Dismiss ERISA Suit
PRESCRIPTION DRUG STORES: Sup. Ct. to Decide on Class Action Row
RBS GLOBAL: 8th Circuit Affirms Class Standing in Suit Vs. Zurn
RIGEL PHARMACEUTICALS: Appeal in Consolidated Suit Still Pending
ROYAL CARIBBEAN: Awaits Ruling on Bid to Dismiss Florida Suit
SEACOR HOLDINGS: Oral Argument in "Robin" Suit Set for Aug. 24
SEACOR HOLDINGS: Plaintiffs Appeal Dismissal of Antitrust Suit
SHARP ENTERTAINMENT: Sued for Unauthorized Filming in Chicago
SILICON LABORATORIES: Appeal in Securities Suit Still Pending
SKILLED HEALTHCARE: Pursues $10-Mil. Claim Over "Humboldt" Suit
SONIC AUTOMOTIVE: Awaits Ruling on Plea to Vacate Partial Award
SONIC AUTOMOTIVE: Obtained Court Approval of "Galura" Settlement
SONUS NETWORKS: One Appeal From Settlement Order Remains Pending
SPACE PENCIL: Accused of Exploiting Consumers' Web Browsers
STRAYER EDUCATION: Va. Suit Stayed Pending Ruling on Dismissal Bid
TENET HEALTHCARE: 'Katrina' Settlement for Final Review in October
TEREX CORP: Still Awaits Rulings on Bid to Dismiss Conn. Suits
TIM HORTONS: Franchisee Owners' Suit Seeks Class-Action Status
TREX CO: Continues to Defend Product Defects Class Suits
TROVER SOLUTIONS: Sued Over Monetary Settlements of NY Claims
UNITED BANKSHARES: Continues to Defend Overdraft Practices Suits
UNITEDHEALTH GROUP: Class Action Lawsuits in Florida Still Pending
UNITEDHEALTH GROUP: Continues to Defend Ingenix-Related Suits
WESTERN UNION: Motion to Dismiss in Colorado Suits Still Pending
WESTINGHOUSE SOLAR: Agrees to Settle Securities Suit in Calif.
WISCONSIN ENERGY: Continues to Defend Class Suit Over Pension Plan
XEROX CORP: Consolidated Securities Suit Pending in Connecticut
*********
ALLSTATE CORP: Claims Processing in Contractors Suit Ongoing
------------------------------------------------------------
Processing of class members' claims pursuant to a settlement in
the lawsuit filed by general contractors is underway, according to
The Allstate Corporation's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
The Company has settled on a 48-state basis a nationwide class
action alleging that it failed to properly pay general contractors
overhead and profit on many homeowners structural loss claims.
General contractors' overhead and profit is an amount that is
added to payments on claims where the services of a general
contractor are reasonably likely to be required. To a large
degree, this lawsuit mirrored similar lawsuits filed against other
carriers in the industry, some of which have settled. A class was
certified for settlement purposes only, and the settlement
received preliminary approval from the court on December 6, 2010,
and final approval on May 6, 2011. No appeal was taken from the
final approval order and the settlement is now final. Processing
of class members' claims made as part of this settlement is
underway. The $75 million settlement was accrued as a prior year
reserve reestimate in property-liability insurance claims and
claims expense in 2010.
ALLSTATE CORP: Summary Judgment Proceedings to Start in Early 2012
------------------------------------------------------------------
Summary judgment proceedings on the validity of waivers and
releases in the lawsuits relating to The Allstate Corporation's
agency program are expected to occur in early 2012, according to
the Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
The Company is defending certain matters relating to the Company's
agency program reorganization announced in 1999. Although these
cases have been pending for many years, they currently are in the
early stages of litigation because of appellate court proceedings
and threshold procedural issues:
* These matters include a lawsuit filed in 2001 by the U.S.
Equal Employment Opportunity Commission ("EEOC") alleging
retaliation under federal civil rights laws ("EEOC I") and a
class action filed in 2001 by former employee agents
alleging retaliation and age discrimination under the Age
Discrimination in Employment Act ("ADEA"), breach of
contract and ERISA violations ("Romero I"). In 2004, in the
consolidated EEOC I and Romero I litigation, the trial court
issued a memorandum and order that, among other things,
certified classes of agents, including a mandatory class of
agents who had signed a release, for purposes of effecting
the court's declaratory judgment that the release was
voidable at the option of the release signer. The court
also ordered that an agent who voided the release must
return to Allstate "any and all benefits received by the
[agent] in exchange for signing the release." The court
also stated that, "on the undisputed facts of record, there
is no basis for claims of age discrimination." The EEOC and
plaintiffs asked the court to clarify and/or reconsider its
memorandum and order and in January 2007, the judge denied
their request. In June 2007, the court reversed its prior
ruling that the release was voidable and granted the
Company's motions for summary judgment, ruling that the
asserted claims were barred by the release signed by most
plaintiffs. Plaintiffs filed a notice of appeal with the
U.S. Court of Appeals for the Third Circuit ("Third
Circuit"). In July 2009, the Third Circuit vacated the
trial court's entry of summary judgment in the Company's
favor and remanded the cases to the trial court for
additional discovery, including additional discovery related
to the validity of the release and waiver. In its opinion,
the Third Circuit held that if the release and waiver is
held to be valid, then all of the claims in Romero I and
EEOC I are barred. Thus, if the waiver and release is
upheld, then only the claims in Romero I asserted by the
small group of employee agents who did not sign the release
and waiver would remain for adjudication. In January 2010,
following the remand, the cases were assigned to a new judge
for further proceedings in the trial court. Plaintiffs
filed their Second Amended Complaint on July 28, 2010.
Plaintiffs seek broad but unspecified "make whole relief,"
including back pay, compensatory and punitive damages,
liquidated damages, lost investment capital, attorneys' fees
and costs, and equitable relief, including reinstatement to
employee agent status with all attendant benefits for up to
approximately 6,500 former employee agents. Despite the
length of time that these matters have been pending, to date
only limited discovery has occurred related to the damages
claimed by individual plaintiffs, and no damages discovery
has occurred related to the claims of the putative class.
Nor have plaintiffs provided any calculations of the
putative class's alleged back pay or the alleged liquidated,
compensatory or punitive damages, instead asserting that
such calculations will be provided at a later stage during
expert discovery. Damage claims are subject to reduction by
amounts and benefits received by plaintiffs and putative
class members subsequent to their employment termination.
Little to no discovery has occurred with respect to amounts
earned or received by plaintiffs and putative class members
in mitigation of their alleged losses. Alleged damage
amounts and lost benefits of the approximately 6,500
putative class members also are subject to individual
variation and determination dependent upon retirement dates,
participation in employee benefit programs, and years of
service. Discovery limited to the validity of the waiver
and release is in process. At present, no class is
certified. Summary judgment proceedings on the validity of
the waiver and release are expected to occur in early 2012.
* A putative nationwide class action has also been filed by
former employee agents alleging various violations of ERISA,
including a worker classification issue ("Romero II").
These plaintiffs are challenging certain amendments to the
Agents Pension Plan and are seeking to have exclusive agent
independent contractors treated as employees for benefit
purposes. Romero II was dismissed with prejudice by the
trial court, was the subject of further proceedings on
appeal, and was reversed and remanded to the trial court in
2005. In June 2007, the court granted the Company's motion
to dismiss the case. Plaintiffs filed a notice of appeal
with the Third Circuit. In July 2009, the Third Circuit
vacated the district court's dismissal of the case and
remanded the case to the trial court for additional
discovery, and directed that the case be reassigned to
another trial court judge. In its opinion, the Third
Circuit held that if the release and waiver is held to be
valid, then one of plaintiffs' three claims asserted in
Romero II is barred. The Third Circuit directed the
district court to consider on remand whether the other two
claims asserted in Romero II are barred by the release and
waiver. In January 2010, following the remand, the case was
assigned to a new judge (the same judge for the Romero I and
EEOC I cases) for further proceedings in the trial court.
On April 23, 2010, plaintiffs filed their First Amended
Complaint. Plaintiffs seek broad but unspecified "make
whole" or other equitable relief, including losses of income
and benefits as a result of their decision to retire from
the Company between November 1, 1999 and December 31, 2000.
They also seek repeal of the challenged amendments to the
Agents Pension Plan with all attendant benefits revised and
recalculated for thousands of former employee agents, and
attorney's fees and costs. Despite the length of time that
this matter has been pending, to date only limited discovery
has occurred related to the damages claimed by individual
plaintiffs, and no damages discovery has occurred related to
the claims of the putative class. Nor have plaintiffs
provided any calculations of the putative class's alleged
losses, instead asserting that such calculations will be
provided at a later stage during expert discovery. Damage
claims are subject to reduction by amounts and benefits
received by plaintiffs and putative class members subsequent
to their employment termination. Little to no discovery has
occurred with respect to amounts earned or received by
plaintiffs and putative class members in mitigation of their
alleged losses. Alleged damage amounts and lost benefits of
the approximately 6,500 putative class members also are
subject to individual variation and determination dependent
upon retirement dates, participation in employee benefit
programs, and years of service. As in Romero I and EEOC I,
discovery at this time is limited to issues relating to the
validity of the waiver and release. Class certification has
not been decided. Summary judgment proceedings on the
validity of the waiver and release are expected to occur in
early 2012.
In these agency program reorganization matters, the threshold
issue of the validity and scope of the waiver and release is yet
to be decided and, if decided in favor of the Company, would
preclude any damages being awarded in Romero I and EEOC I and may
also preclude damages from being awarded in Romero II. In the
Company's judgment a loss is not probable. Allstate has been
vigorously defending these lawsuits and other matters related to
its agency program reorganization.
ALLSTATE CORP: Supreme Court Sends La. Suit Back to 5th Circuit
---------------------------------------------------------------
The Louisiana Supreme Court has sent back to the U.S. Court of
Appeals for the Fifth Circuit a putative class action lawsuit
filed by the Louisiana Attorney General for a determination as to
whether each carrier's anti-assignment clause is sufficient to
prohibit post-loss assignment, according to The Allstate
Corporation's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
The Company is vigorously defending a number of matters in various
stages of development filed in the aftermath of Hurricane Katrina,
including individual lawsuits and a statewide putative class
action in Louisiana. The Louisiana Attorney General filed a
putative class action lawsuit in state court against Allstate and
every other homeowner insurer doing business in the State of
Louisiana, on behalf of the State, as assignee, and on behalf of a
class of Road Home fund recipients (the "Road Home Class Action")
alleging that the insurers have failed to pay all damages owed
under their policies. The insurers removed the matter to federal
court. The district court denied plaintiffs' motion to remand the
matter to state court and the U.S. Court of Appeals for the Fifth
Circuit ("Fifth Circuit") affirmed that ruling. The defendants
filed a motion to dismiss and the plaintiffs filed a motion to
remand the claims involving a Road Home subrogation agreement. In
March 2009, the district court denied the State's request that its
claims be remanded to state court. As for the defendant insurers'
motion, the judge granted it in part and denied it in part.
Dismissal of all of the extra-contractual claims, including the
bad faith and breach of fiduciary duty claims, was granted.
Dismissal also was granted of all claims based on the Valued
Policy Law and all flood loss claims based on the levee breaches
finding that the insurers flood exclusions precluded coverage.
The remaining claims are for breach of contract and for
declaratory relief on the alleged underpayment of claims by the
insurers. The judge did not dismiss the class action allegations.
The defendants also had moved to dismiss the complaint on grounds
that the State had no standing to bring the lawsuit as an assignee
of insureds because of anti-assignment language in the insurers'
policies. The judge denied the defendants' motion for
reconsideration on the assignment issue but found the matter was
ripe for consideration by the federal appellate court. The
defendants filed a petition for permission to appeal to the Fifth
Circuit. The Fifth Circuit accepted review. After the Fifth
Circuit accepted review, plaintiffs filed a motion to remand the
case to state court, asserting that the class claims on which
federal jurisdiction was premised have now effectively been
dismissed as a result of a ruling in a related case. The Fifth
Circuit denied the motion for remand, without prejudice to
plaintiffs' right to refile the motion for remand after the Fifth
Circuit disposes of the pending appeal. On July 28, 2010, the
Fifth Circuit issued an order stating that since there is no
controlling Louisiana Supreme Court precedent on the issue of
whether an insurance policy's anti-assignment clause prohibits
post-loss assignments, the Fifth Circuit is certifying that issue
to the Louisiana Supreme Court.
On May 10, 2011, the Louisiana Supreme Court issued its ruling,
holding that the contractual prohibition on post-loss assignments
does not violate public policy, and that parties can contract to
prohibit post-loss assignments. However, the Court went on to
hold that the contract language must clearly and unambiguously
express that the non-assignment clause applies to post-loss
assignments. The Supreme Court refused to evaluate the language
of the various policies before it. Rather, the Court stated that
it is necessary for the federal court to evaluate the relevant
anti-assignment clauses on a policy-by-policy basis to determine
whether the language is sufficient to prohibit post-loss
assignment. The case will now be sent back to the Fifth Circuit
for a determination of whether each carrier's anti-assignment
clause is sufficient to prohibit post-loss assignment.
The Company believes that its adjusting practices and processes in
connection with Katrina homeowners claims were sound and in
accordance with industry standards and state law. Each of the
claims involved is fact-specific and requires independent
analysis. There remain significant questions of Louisiana law
that have yet to be decided, including the enforceability of the
Company's anti-assignment clause and certain statute of limitation
(prescription) issues. Based on recent rulings by the Louisiana
Supreme Court, which have been construed to extend the time period
within which Katrina actions can be filed, new individual cases
continue to be filed. In addition, the State has yet to identify
the specific claims that it contends are at issue in the Road Home
Class Action, or the alleged deficiencies in adjusting those
claims. There are many potential individual claims at issue in
this litigation, each of which will require individual analysis,
and a number of which may be subject to individual defenses,
including release, accord and satisfaction, prescription, waiver
and estoppel. There has been no factual development or discovery
in connection with the Road Home Class Action. The motions to
dismiss have been pending since the inception of the case. No
answers have been filed, and the case remains stayed until the
current appeal is concluded. Moreover, the State has indicated
that it intends to drop its class allegations and seek a remand to
state court, which is considered to be a less favorable forum, but
the dismissal of the class allegations and prosecution by the
State solely on its own behalf as assignee, may on the other hand
adversely impact the State's ability to recover exemplary damages
or penalties that might otherwise be sought on the underlying
claim. In the Company's judgment a loss is not probable.
ALLSTATE CORP: Appeal in Worker Classification Suit Still Pending
-----------------------------------------------------------------
An appeal from a court decision in a class action lawsuit
involving worker classification issues remains pending, according
to The Allstate Corporation's August 1, 2011, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2011.
Allstate has been vigorously defending a lawsuit in regards to
certain claims employees involving worker classification issues.
This lawsuit is a certified class action challenging a state wage
and hour law. In this case, plaintiffs sought actual damages in
an amount to be proven at trial, liquidated damages in an amount
equal to an unspecified percentage of the aggregate underpayment
of wages to be proven at trial, as well as attorneys' fees and
costs. Plaintiffs have not made a settlement demand nor have they
alleged the amount of damages with any specificity. The case was
bifurcated between liability and damages and is currently focused
only on liability issues. No discovery has taken place regarding
plaintiffs' alleged damages. In December 2009, the liability
phase of the case was tried, and, on July 6, 2010, the court
issued its decision finding in favor of Allstate on all claims.
The plaintiffs have appealed the decision in favor of Allstate to
the first level appellate court.
After concluding the current appeal, the Company says parties may
seek a subsequent appeal to the Illinois Supreme Court. Only
liability issues are being addressed on appeal and no damages may
be awarded at this stage of the proceedings. In the event the
trial court's order were to be overturned, however, the parties
would need to conduct damages discovery, and a trial on damages
would have to take place, before any damages could be awarded. In
the Company's judgment a loss is not probable.
ATLAS AIR: Still Defends Fuel Surcharges Manipulation Suits
-----------------------------------------------------------
Atlas Air Worldwide Holdings, Inc., continues to defend itself
from lawsuits alleging manipulation of fuel surcharges and other
rate components for air cargo services, according to the Company's
August 2, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
Atlas Air Worldwide Holdings, Inc., is the parent company of its
principal operating subsidiary, Atlas Air, Inc., and of Polar Air
Cargo LLC -- Old Polar.
In 2010, Old Polar entered into a plea agreement with the United
States Department of Justice (the "DOJ") relating to the
previously disclosed DOJ investigation concerning alleged
manipulation by cargo carriers of fuel surcharges and other rate
components for air cargo services (the "DOJ Investigation").
Under the terms of the agreement, Old Polar will pay a fine of
$17.4 million, payable in five annual installments, the first of
which was made in November 2010. The fine relates to an alleged
agreement by Old Polar with respect to fuel surcharges on cargo
shipped from the United States to Australia during the time period
from January 2000 through April 2003. The United States District
Court for the District of Columbia held a hearing on the plea on
November 15, 2010. The court accepted the plea and judgment was
entered the following day, finalizing the plea agreement, in the
amount of $17.4 million as agreed.
As a result of the DOJ Investigation, the Company and Old Polar
have been named defendants, along with a number of other cargo
carriers, in several class actions in the United States arising
from allegations about the pricing practices of a number of air
cargo carriers that have now been consolidated for pre-trial
purposes in the United States District Court for the Eastern
District of New York. The consolidated complaint alleges, among
other things, that the defendants, including the Company and Old
Polar, manipulated the market price for air cargo services sold
domestically and abroad through the use of surcharges, in
violation of United States, state, and European Union antitrust
laws. The lawsuit seeks treble damages and injunctive relief. The
defendants moved to dismiss the consolidated complaint, and on
September 26, 2008, the Magistrate Judge who heard the motion to
dismiss issued a decision recommending that the Federal District
Court Judge grant the defendants' motion to dismiss. The
Magistrate Judge recommended that plaintiffs' claims based on the
United States antitrust laws be dismissed without prejudice so
that plaintiffs have an opportunity to cure the defects in their
complaint by pleading more specific facts, if they have any,
relevant to their federal claims. The Magistrate Judge
recommended that the plaintiffs' claims based on state and
European Union laws be dismissed with prejudice. Both plaintiffs
and defendants objected to portions of the Magistrate Judge's
Report and Recommendation. In 2009, the Federal District Court
Judge issued an opinion and order, accepting the Magistrate
Judge's Report and Recommendation, except for the Magistrate
Judge's recommendation that the complaint be dismissed in its
entirety, instead maintaining the claims under the United States
antitrust laws on the grounds that the consolidated complaint was
sufficiently detailed to withstand a motion to dismiss. Old Polar
and the other defendants moved for reconsideration of that portion
of the Federal District Court Judge's decision which motion was
denied on March 22, 2010. The plaintiffs moved to join Polar Air
Cargo Worldwide, Inc., as a defendant in this case on February 10,
2011. The Federal District Court Judge granted the plaintiffs'
motion on April 13, 2011. Pre-trial written and document
discovery and depositions are ongoing. The Company says it is
unable to predict the outcome of this litigation.
In 2007, the Company and Old Polar commenced an adversary
proceeding in bankruptcy court against each of the plaintiffs in
this class action litigation seeking to enjoin the plaintiffs from
prosecuting claims against the Company and Old Polar that arose
prior to 2004, the date on which the Company and Old Polar emerged
from bankruptcy. In 2007, the plaintiffs consented to the
injunctive relief requested and the bankruptcy court entered an
order enjoining plaintiffs from prosecuting Company claims arising
prior to 2004.
The Company, Old Polar and a number of other cargo carriers have
also been named as defendants in civil class action lawsuits in
the provinces of British Columbia, Ontario and Quebec, Canada that
are substantially similar to the class action lawsuits in the
United States. The plaintiffs in the British Columbia case have
indicated they do not intend to pursue their lawsuit against the
Company and Old Polar. The Company says it is unable to
reasonably predict the outcome of the litigation in Ontario and
Quebec.
If the Company or Old Polar were to incur an unfavorable outcome
in connection with one or more of these matters, such outcome is
not expected to materially affect the Company's business,
financial condition, results of operations, and/or cash flows.
BAXTER INT'L: Appeal From ERISA Suit Dismissal Still Pending
------------------------------------------------------------
Plaintiffs' appeal from the dismissal of their class action
lawsuit against Baxter International Inc. remains pending,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In October 2004, a purported class action was filed in the
U.S.D.C. for the Northern District of Illinois against Baxter and
its current Chief Executive Officer and then current Chief
Financial Officer and their predecessors for alleged violations of
the Employee Retirement Income Security Act of 1974, as amended.
Plaintiff alleges that these defendants, along with the
Administrative and Investment Committees of the company's 401(k)
plans, breached their fiduciary duties to the plan participants by
offering Baxter common stock as an investment option in each of
the plans during the period of January 2001 to October 2004. In
March 2006, the trial court certified a class of plan participants
who elected to acquire Baxter common stock through the plans
between January 2001 and the present. Summary judgment in the
Company's favor was granted by the trial court in May 2010 and
plaintiffs appealed the decision to the U.S. Court of Appeals for
the Seventh Circuit.
BAXTER INT'L: Continues to Defend Class Suit in Illinois
--------------------------------------------------------
Baxter International Inc. continues to defend itself from a class
action lawsuit alleging it made false and misleading statements,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In September 2010, a purported class action was filed in the
U.S.D.C. for the Northern District of Illinois against the Company
and certain of its current executive officers. The complaint
alleges that, from September 17, 2009, to May 3, 2010, the
defendants issued materially false and misleading statements
regarding the Company's plasma-based therapies business and the
Company's remediation of its COLLEAGUE infusion pumps causing the
Company's common stock to trade at artificially high levels. Two
additional lawsuits have subsequently been filed against the
Company and certain of its executive officers in the U.S.D.C. for
the Northern District of Illinois. These lawsuits seek to recover
the lost value of investors' stock as damages. These lawsuits
have been consolidated for further proceedings.
No further updates were reported in the Company's latest SEC
filing.
BAXTER INT'L: Discovery Still Ongoing in Plasma Therapies Suit
--------------------------------------------------------------
Discovery is still ongoing in the consolidated lawsuit against
Baxter International Inc. relating to plasma-derived therapies,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
The Company is a defendant, along with others, in nineteen
lawsuits brought in various U.S. federal courts alleging that
Baxter and certain of its competitors conspired to restrict output
and artificially increase the price of plasma-derived therapies
since 2003. The complaints attempt to state a claim for class
action relief and in some cases demand treble damages. These
cases have been consolidated for pretrial proceedings before the
U.S.D.C. for the Northern District of Illinois. In February 2011,
the court denied the Company's motion to dismiss certain of the
claims and the parties are proceeding into discovery.
No further updates were reported in the Company's latest SEC
filing.
BECTON DICKINSON: 3rd Circuit Allows Appeal in Antitrust Suit
-------------------------------------------------------------
The Third Circuit Court of Appeals granted a request to appeal on
an interlocutory basis a trial court's denial of a motion to
approve a settlement agreement, according to Becton, Dickinson and
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
The Company is named as a defendant in the following purported
class action lawsuits brought on behalf of distributors and other
entities that purchase the Company's products (the "Distributor
Plaintiffs"), alleging that the Company violated federal antitrust
laws, resulting in the charging of higher prices for the Company's
products to the plaintiffs and other purported class members:
Case Court Date Filed
---- ----- ----------
Louisiana Wholesale Drug U.S. Dist. Court March 25, 2005
Company, Inc., et al. vs. Newark, NJ
Becton Dickinson and Co.
SAJ Distributors, Inc. U.S. Dist. Court Sept. 6, 2005
et. al. vs. Becton Eastern Dist. of
Dickinson & Co. Pennsylvania
Dik Drug Company, et al. U.S. Dist. Court Sept. 12, 2005
vs. Becton, Dickinson & Co. Newark, NJ
American Sales Company, U.S. Dist. Court Oct. 3, 2005
Inc. et. al. vs. Becton, Eastern Dist. of
Dickinson & Co. Pennsylvania
Park Surgical Co. Inc. U.S. Dist. Court Oct. 26, 2005
et. al. vs. Becton, Eastern Dist. of
Dickinson and Company Pennsylvania
These actions have been consolidated under the caption "In re
Hypodermic Products Antitrust Litigation."
The Company is also named as a defendant in the following
purported class action lawsuits brought on behalf of purchasers of
the Company's products, such as hospitals (the "Hospital
Plaintiffs"), alleging that the Company violated federal and state
antitrust laws, resulting in the charging of higher prices for the
Company's products to the plaintiffs and other purported class
members:
Case Court Date Filed
---- ----- ----------
Jabo's Pharmacy, Inc., U.S. Dist. Court June 7, 2005
et. al. v. Becton Greenville, Tenn.
Dickinson & Company
Drug Mart Tallman Inc. U.S. Dist. Court Jan. 17, 2006
et. al. v. Becton Newark, New Jersey
Dickinson and Company
Medstar v. Becton U.S. Dist. Court May 18, 2006
Dickinson Newark, New Jersey
The Hebrew Home for U.S. Dist. Court March 28, 2007
the Aged at Riverdale Southern Dist.
vs. Becton Dickinson of New York
and Company
The plaintiffs in each of the antitrust class action lawsuits seek
monetary damages. All of the antitrust class action lawsuits have
been consolidated for pre-trial purposes in a Multi-District
Litigation (MDL) in Federal court in New Jersey.
On April 27, 2009, the Company entered into a settlement agreement
with the Distributor Plaintiffs in these actions. The settlement
agreement provided for, among other things, the payment by the
Company of $45,000 in exchange for a release by all potential
class members of the direct purchaser claims under federal
antitrust laws related to the products and acts enumerated in the
complaint, and a dismissal of the case with prejudice, insofar as
it relates to direct purchaser claims. The release would not
cover potential class members that affirmatively opt out of the
settlement. On September 30, 2010, the court issued an order
denying a motion to approve the settlement agreement, ruling that
the Hospital Plaintiffs, and not the Distributor Plaintiffs, are
the direct purchasers entitled to pursue damages under the federal
antitrust laws for certain sales of BD products. The settlement
agreement currently remains in effect, subject to certain
termination provisions. On July 22, 2011, the Third Circuit Court
of Appeals granted the distributor plaintiffs' request to appeal
the trial court's order on an interlocutory basis. The Company
currently cannot estimate the range of reasonably possible losses
with respect to these class action matters beyond the $45,000
already accrued and changes to the amount already recognized may
be required in the future as additional information becomes
available.
BLACK & DECKER: Fined $960T for Not Reporting Defective Trimmers
----------------------------------------------------------------
The U.S. Consumer Product Safety Commission announced that Black &
Decker (U.S.) Inc., of Towson, Maryland, has agreed to pay a civil
penalty of $960,000. The penalty agreement has been provisionally
accepted by the Commission (5-0).
The settlement resolves CPSC staff's allegations that Black &
Decker knowingly failed to report several safety defects and
hazards with the Grasshog XP immediately to CPSC, as required by
federal law. CPSC staff also alleges the firm withheld
information requested by CPSC staff during the course of the
investigation.
Federal law requires manufacturers, distributors and retailers to
report to CPSC immediately (within 24 hours) after obtaining
information reasonably supporting the conclusion that a product
contains a defect which could create a substantial product hazard,
creates an unreasonable risk of serious injury or death, or fails
to comply with any consumer product safety rule or any other rule,
regulation, standard or ban enforced by CPSC.
CPSC staff alleges Black & Decker knew, on or before May 2006,
that the high-powered, electric Grasshog XP GH1000 was defective
and could cause harm, but failed to report this to CPSC.
CPSC staff also alleges that Black & Decker failed to provide full
information about defects with the Grasshog XP as requested in May
2006. Based on the incomplete information provided at that time,
CPSC closed the case. The firm did not give CPSC staff full
information about the extent of Grasshog XP defects or the
mounting number of incidents and injuries until October 2006.
In July 2007, Black & Decker and CPSC announced the recall of
about 200,000 Grasshog XP model GH1000 trimmer/edgers. By that
time, there were more than 700 reports of incidents, including 58
injuries with the Grasshog XP. The trimmer/edgers' spool, spool
cap and pieces of trimmer string can come loose during use and
become projectiles. This poses a serious laceration hazard to the
user and to bystanders. The trimmer/edgers also can overheat and
burn consumers. Black & Decker sold the Grasshog XP weed trimmers
from November 2005 through spring 2007 for about $70.
Pictures of the recalled products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml11/11295.html
The recall was reannounced in August 2009 with an additional 100
injuries reported. CPSC urges consumers with recalled Grasshog XP
trimmer/edgers to contact Black & Decker for a free repair kit.
In agreeing to the settlement, Black & Decker (U.S.) Inc. denies
CPSC staff allegations that it knowingly violated the law.
BRIDGEPOINT EDUCATION: Continues to Defend "Moore" Suit
-------------------------------------------------------
Bridgepoint Education, Inc., continues to defend itself against a
class action lawsuit captioned Moore v. Ashford University, LLC,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In April 2011, the Company received a copy of a complaint filed as
a class action lawsuit naming the Company and Ashford University,
LLC, as defendants. The complaint was filed in the Superior Court
of the State of California in San Diego on April 25, 2011, and is
captioned Moore v. Ashford University, LLC. The complaint
generally alleges that the plaintiff and similarly situated
employees were improperly denied certain wage and hour protections
under California law. The Company believes the lawsuit is without
merit and intends to vigorously defend against it.
BRIDGEPOINT EDUCATION: Continues to Defend "Rosendahl" Suit
-----------------------------------------------------------
Bridgepoint Education, Inc., continues to defend itself against a
class action lawsuit pending in California, according to the
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
In January 2011, the Company received a copy of a complaint filed
as a class action lawsuit naming the Company, Ashford University
and University of the Rockies as defendants. The complaint was
filed in the U.S. District Court for the Southern District of
California on January 11, 2011, and is captioned Rosendahl v.
Bridgepoint Education, Inc. The complaint generally alleges that
the Company and the other defendants engaged in improper,
fraudulent and illegal behavior in their efforts to recruit and
retain students. The Company believes the lawsuit is without
merit and intends to vigorously defend against it.
BRIDGEPOINT EDUCATION: Still Defends "Sanchez" Suit in Calif.
-------------------------------------------------------------
In May 2011, Bridgepoint Education, Inc., received a copy of a
complaint filed as a class action lawsuit naming the Company as a
defendant. The complaint was filed in the Superior Court of the
State of California in San Diego on May 6, 2011, and is captioned
Sanchez v. Bridgepoint Education, Inc. The complaint generally
alleges that the plaintiff and similarly situated employees were
improperly denied certain wage and hour protections under
California law. The Company believes the lawsuit is without merit
and intends to vigorously defend against it, according to the
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
BRIDGEPOINT EDUCATION: Still Defends "Stevens" Suit in Calif.
-------------------------------------------------------------
Bridgepoint Education, Inc., continues to defend itself against a
class action lawsuit alleging violations of wage and hour laws in
California, according to the Company's August 2, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2011.
In February 2011, the Company received a copy of a complaint filed
as a class action lawsuit naming the Company, Ashford University,
LLC, and certain employees as defendants. The complaint was filed
in the Superior Court of the State of California in San Diego on
February 17, 2011, and is captioned Stevens v. Bridgepoint
Education, Inc. The complaint generally alleges that the
plaintiffs and similarly situated employees were improperly denied
certain wage and hour protections under California law. The
Company believes the lawsuit is without merit and intends to
vigorously defend against it.
CADENCE DESIGN: Awaits Approval of $38-Mil. Securities Suit Deal
----------------------------------------------------------------
During fiscal 2008, three complaints were filed in the United
States District Court for the Northern District of California, or
District Court, all alleging violations of Sections 10(b) and
20(a) of the Exchange Act, and Rule 10b-5 promulgated thereunder,
on behalf of a purported class of purchasers of Cadence Design
Systems, Inc.'s common stock. The first such complaint was filed
on October 29, 2008, captioned Hu v. Cadence Design Systems, Inc.,
Michael J. Fister, William Porter and Kevin S. Palatnik; the
second such complaint was filed on November 4, 2008, captioned
Vyas v. Cadence Design Systems, Inc., Michael J. Fister and
Kevin S. Palatnik; and the third such complaint was filed on
November 21, 2008, captioned Collins v. Cadence Design Systems,
Inc., Michael J. Fister, John B. Shoven, Kevin S. Palatnik and
William Porter. On March 4, 2009, the District Court entered an
order consolidating these three complaints and captioning the
consolidated case "In re Cadence Design Systems, Inc. Securities
Litigation." The District Court also named a lead plaintiff and
lead counsel for the consolidated litigation. The lead plaintiff
filed its consolidated amended complaint on April 24, 2009, naming
Cadence, Michael J. Fister, Kevin S. Palatnik, William Porter and
Kevin Bushby as defendants, and alleging violations of Sections
10(b) and 20(a) of the Exchange Act, and Rule 10b-5 promulgated
thereunder, on behalf of a purported class of purchasers of
Cadence's common stock who traded Cadence's common stock between
April 23, 2008, and December 10, 2008, or the Alleged Class
Period. The amended complaint alleged that Cadence and the
individual defendants made statements during the Alleged Class
Period regarding Cadence's financial results that were false and
misleading because Cadence had recognized revenue that should have
been recognized in subsequent periods. The amended complaint
requested certification of the action as a class action,
unspecified damages, interest and costs, and unspecified equitable
relief. On June 8, 2009, Cadence and the other defendants filed a
motion to dismiss the amended complaint. On September 11, 2009,
the District Court held that the plaintiffs had failed to allege a
valid claim under the relevant legal standards and granted the
defendants' motion to dismiss the amended complaint. The District
Court gave the plaintiffs leave to file another amended complaint,
and the plaintiffs did so on October 13, 2009. The amended
complaint filed on October 13, 2009, names the same defendants,
asserts the same causes of action, and seeks the same relief as
the earlier amended complaint. Cadence moved to dismiss the
October 13, 2009, amended complaint. The District Court denied
the motion to dismiss on March 2, 2010. On July 7, 2010, the
parties agreed, and the District Court ordered, that the
litigation be stayed in order to facilitate mediation. On
February 11, 2011, the parties agreed to settle the litigation for
consideration of $38.0 million, of which approximately $22.2
million will be paid by Cadence's insurers, with the balance to be
paid by Cadence. Cadence agreed to this settlement without
admitting any wrongdoing on the part of the company or any of its
current or former directors or executive officers, and the
settlement is subject to completion of final settlement
documentation by the parties and approval by the District Court.
No further updates were provided in the Company's July 29, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 2, 2011.
CAMERON INT'L: Awaits Final Report on Deepwater Horizon Accident
----------------------------------------------------------------
Cameron International Corporation is awaiting the release of the
final report on the investigation relating to the Deepwater
Horizon accident, according to the Company's August 1, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2011.
A blowout preventer ("BOP") originally manufactured by the Company
and delivered in 2001, and for which the Company was one of the
suppliers of spare parts and repair services, was deployed by the
drilling rig Deepwater Horizon when the rig experienced a tragic
explosion and fire on April 20, 2010, resulting in bodily injuries
and loss of life, loss of the rig, and an unprecedented discharge
of hydrocarbons into the Gulf of Mexico.
While the Company did not operate the BOP, nor did it have anyone
on the rig at the time of the incident, claims for personal
injury, wrongful death and property damage arising from the
Deepwater Horizon incident have been asserted against the Company
and others. Additionally, claims for pollution and for economic
damages, including business interruption and loss of revenue, have
been, and may continue to be asserted against all parties
associated with this incident, including the Company, BP p.l.c.
and certain of its subsidiaries, the operator of Mississippi
Canyon Block 252 upon which the Macondo well was being drilled,
Transocean Ltd. and certain of its affiliates, the rig owner and
operator, as well as other equipment and service companies,
including Halliburton. The Company has been named as one of
multiple defendants in over 350 lawsuits filed and presently
pending in a variety of Federal and State courts, a number of
which have been filed as class actions or multi-plaintiff actions.
Other defendants, including BP, Transocean and Halliburton have
asserted cross-claims against the Company as the Company has
asserted such claims against them. Most of these lawsuits pending
in Federal courts have been consolidated into a single proceeding
before a single Federal judge under the rules governing multi-
district litigation. The consolidated case is styled In Re: Oil
Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico on
April 20, 2010, MDL Docket No. 2179. There are also a small
number of cases pending in state courts. The States of Alabama
and Louisiana have brought a claim for destruction of and/or harm
to natural resources against those associated with this incident,
including Cameron, in State of Alabama, ex. rel. Troy King,
Attorney General vs. Transocean Ltd., et. al., Cause No.
2:10cv00691, U.S. Dist. Ct., M.D. Ala., and State of Louisiana vs.
BP Exploration & Production, Inc., et. al, MDL No. 2179, as have a
number of other local governmental entities and 3 Mexican states.
It is possible other such claims may be asserted against the
Company by the United States Government (USG) and by other Gulf
and/or East Coast States, whose Attorneys General have notified
the Company to preserve documents in the event of a claim, and
possibly by other parties. The USG has brought lawsuit against BP
and certain other parties associated with this incident for
recovery under statutes such as the Oil Pollution Act of 1990
(OPA) and the Clean Water Act, which lawsuit has been made part of
the MDL proceedings. While the Company was not named as a
defendant in this lawsuit by the USG, BP brought a third-party
complaint for contribution under OPA against several parties
associated with this incident which were not named by the USG,
including the Company. A shareholder derivative lawsuit, Berzner
vs. Erikson, et al., Cause No. 2010-71817 in the 190th District
Court of Harris County, Texas, has been filed against the
Company's directors in connection with this incident and its
aftermath alleging the Company's directors failed to exercise
their fiduciary duties regarding the safety and efficacy of its
products. This incident and its causes have been investigated by
a joint investigation team of the U.S. Coast Guard and the Bureau
of Ocean Energy Management (the "JIT"), which has named Cameron a
party-in-interest, the Departments of the Interior and Justice,
the U.S. Chemical Safety and Hazard Investigation Board, and by
various other governmental entities, including Congressional
Committees. An investigation conducted by the National Commission
on the BP Deepwater Horizon Oil Spill and Offshore Drilling has
been completed. The U.S. Department of Justice, in addition to
its involvement in the civil litigation, formed a task force to
conduct criminal investigations into possible criminal charges
stemming from this incident and its aftermath.
The Federal Court overseeing the multi-district litigation has
ruled that it will begin trying liability issues arising out of
the Deepwater Horizon Matter in February 2012, and has issued a
number of orders to effectuate this scheduling.
Based on the facts known to date, the Company is of the opinion
that there was no defect in or failure of the BOP that caused or
contributed to the explosion. The reasons as to why the efforts
to shut-in the well after the explosion were unsuccessful are not
yet known and are the subject of continuing investigation and
discovery in the MDL proceedings. A report on the results of a
forensic examination of the BOP by Det Norske Veritas commissioned
by the JIT as part of its investigation was made public in March
2011. This report cited what it considered to be the inability of
the BOP to shear the off-center drill pipe as a contributing
factor to the BOP's blind shear rams being unable to close and
seal the well. The JIT recently announced that it would release
its final report in the "near future" but after the JIT's
previously scheduled July 27, 2011 release date.
The extent of the environmental impact, and the ultimate costs and
damages that will ultimately be determined attributable to this
incident and its aftermath are not yet known and therefore cannot
be reasonably estimated. As a result, the Company is unable to
make any reasonable determination of what liability, if any, the
Company could be found to have with respect to any of these claims
or whether the Company will be found to have any liability,
directly or by way of contribution, under any environmental laws
or regulations or otherwise. BP has been designated as the
Responsible Party for the pollution emanating from the Macondo
well under OPA, and has accepted such designation. Cameron has
not been named a Responsible Party.
The applicable contracts between Cameron and Transocean entities
provide for customary industry "knock-for-knock" indemnification
by which each party agreed to bear the risk of, and hold the other
harmless with respect to, all claims for personal injury, to
include wrongful death, and property loss or damage of its own,
its employees and those of its contractors. Settlements in a
number of personal injury and wrongful death cases have been
reached between Transocean and the claimants, and the settlement
agreements have included a complete release of Cameron. In
addition, the contracts provide that in the event Transocean is
entitled to indemnity under any contract with its customers or
suppliers for pollution or other damages associated with a blowout
or loss of well control, Transocean will provide Cameron with the
benefit of such indemnity to the fullest extent possible.
Transocean has publicly stated that it has a full pollution
indemnity from BP, although BP has so far declined to acknowledge
any obligation under the indemnity.
The Company has commercial general liability insurance, including
completed products and sudden accidental pollution coverage, with
limits of $500 million and a self retention of $3 million.
Defense costs are not covered by the policy. Coverage includes
claims for personal injury and wrongful death, as well as
liability for pollution and loss of revenue/business interruption.
The Company has notified its insurers of the claims being asserted
against it. The insurers have responded with "reservation of
rights" letters.
While the Company's BOPs have a history of reliable performance
when properly maintained and operated in accordance with product
specifications, until the litigation progresses and until the
investigations are completed, the Company says it is unable to
determine the extent of its future involvement in the litigation
and any liability resulting from this incident. If it is
ultimately determined that the Company bears some responsibility,
and therefore liability, for the costs and damages caused by this
event, the Company will rely on its contractual indemnity rights
and then, if and to the extent necessary and available, on its
insurance coverage. If the Company's contractual indemnities are
determined to be inapplicable, or the indemnitors fail or are
unable to fulfill their contractual indemnity obligations, and if
the damages and costs ultimately determined to be the Company's
responsibility exceed its available insurance coverage, the
Company could be liable for amounts that could have a material
adverse impact on its financial condition, results of operations
and cash flows.
Through June 30, 2011, the Company has incurred and expensed legal
fees of $34.8 million. The Company has not accrued any amounts
relating to this matter because it does not believe at the present
time a loss is probable.
CARTER'S INC: 2nd Amended Complaint Filed in Consolidated Suit
--------------------------------------------------------------
Plaintiffs filed a second amended and consolidated complaint in
the consolidated shareholder lawsuit against Carter's, Inc.,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
July 2, 2011.
A shareholder class action lawsuit was filed on September 19,
2008, in the United States District Court for the Northern
District of Georgia entitled Plymouth County Retirement System v.
Carter's, Inc., No. 1:08-CV-02940-JOF (the "Plymouth Action").
The Amended Complaint filed on May 12, 2009, in the Plymouth
Action asserted claims under Sections 10(b), 20(a), and 20A of the
1934 Securities Exchange Act, and alleged that between February 1,
2006, and July 24, 2007, the Company and certain current and
former executives made material misrepresentations to investors
regarding the successful integration of OshKosh into the Company's
business, and that the share price of the Company's stock later
fell when the market learned that the integration had not been as
successful as represented. Defendants in the Plymouth Action
filed a motion to dismiss the Amended Complaint for failure to
state a claim under the federal securities laws on July 17, 2009,
and briefing of that motion was complete on October 22, 2009.
A separate shareholder class action lawsuit was filed on
November 17, 2009, in the United States District Court for the
Northern District of Georgia entitled Mylroie v. Carter's, Inc.,
No. 1:09-CV-3196-JOF (the "Mylroie Action"). The initial
Complaint in the Mylroie Action asserted claims under Sections
10(b) and 20(a) of the 1934 Securities Exchange Act, and alleged
that between April 27, 2004, and November 10, 2009, the Company
and certain current and former executives made material
misstatements to investors regarding the Company's accounting for
discounts offered to some wholesale customers. The Court
consolidated the Plymouth Action and the Mylroie Action on
November 24, 2009. On March 15, 2010, the plaintiffs in the
Consolidated Action filed their amended and consolidated
complaint. The Company filed a motion to dismiss on April 30,
2010, and briefing of the motion was complete on July 23, 2010.
On March 16, 2011, the United States District Court for the
Northern District of Georgia granted without prejudice the
Company's motion to dismiss all of the claims in the amended and
consolidated complaint in the Consolidated Action for failure to
state a claim under the federal securities laws. The plaintiffs
filed a second amended and consolidated complaint on July 20,
2011.
The Company says it intends to vigorously defend against the
claims in the Consolidated Action.
CBS CORPORATION: Omaha Funds' Appeal From Dismissal Still Pending
-----------------------------------------------------------------
The appeal of The City of Omaha, Nebraska Civilian Employees'
Retirement System and The City of Omaha Police and Fire Retirement
System from the dismissal of their amended class action complaint
against CBS Corp. remains pending, according to the Company's
August 2, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarterly period ended June 30, 2011.
On December 12, 2008, the City of Pontiac General Employees'
Retirement System filed a self-styled class action complaint in
the United States District Court for the Southern District of New
York against the Company and its Chief Executive Officer, Chief
Financial Officer, Chief Accounting Officer, and Treasurer,
alleging violations of federal securities law. The complaint,
which was filed on behalf of a putative class of purchasers of the
Company's common stock between February 26, 2008 and October 10,
2008, alleges that, among other things, the Company's failure to
timely write down the value of certain assets caused the Company's
reported operating results during the Class Period to be
materially inflated. The plaintiffs seek unspecified compensatory
damages.
On February 11, 2009, a motion was filed in the case on behalf of
The City of Omaha, Nebraska Civilian Employees' Retirement System,
and The City of Omaha Police and Fire Retirement System seeking to
appoint the Omaha Funds as the lead plaintiffs in this case; on
March 5, 2009, the court granted that motion. On May 4, 2009, the
plaintiffs filed an Amended Complaint, which removes the Treasurer
as a defendant and adds the Executive Chairman. On July 13,
2009, all defendants filed a motion to dismiss this action. On
March 16, 2010, the court granted the Company's motion and
dismissed this action as to the Company and all defendants. On
April 30, 2010, the plaintiffs filed a motion for leave to serve
an amended complaint. On September 23, 2010, the court issued an
order granting leave to amend. On October 8, 2010, the Company
was served with an Amended Complaint, which redefines the Class
Period to be April 29, 2008 to October 10, 2008 and alleges that
the impairment charge should have been taken during the first
quarter of 2008. The Company filed a motion to dismiss this
Amended Complaint on November 19, 2010. On May 24, 2011, the
court granted the motion to dismiss and entered judgment in favor
of defendants on May 25, 2011. On June 23, 2011, plaintiffs filed
a Notice of Appeal.
CNO FINANCIAL: Appeal in "Ruderman" Suit Remains Pending
--------------------------------------------------------
An appeal in the purported class action lawsuit filed by Sydelle
Ruderman against CNO Financial Group, Inc.'s subsidiary --
Washington National Insurance Company -- remains pending,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
On December 8, 2008, a purported Florida state class action was
filed in the U.S. District Court for the Southern District of
Florida, Sydelle Ruderman individually and on behalf of all other
similarly situated v. Washington National Insurance Company, Case
No. 08-23401-CIV-Cohn/Selzer. The plaintiff alleges that the
inflation escalation rider on her policy of long-term care
insurance operates to increase the policy's lifetime maximum
benefit, and that Washington National breached the contract by
stopping her benefits when they reached the lifetime maximum. The
Company takes the position that the inflation escalator only
affects the per day maximum benefit. Plaintiffs filed their
motion for class certification, and the motion has been fully
briefed by both sides. The court has not yet ruled on the motion
or set it for hearing. Additional parties have asked the court to
allow them to intervene in the action, and on January 5, 2010, the
court granted the motion to intervene and granted the plaintiff's
motion for class certification. The court certified a (B)(3)
Florida state class alleging damages and a (B)(2) Florida state
class alleging injunctive relief. The parties have reached a
settlement in principle of the (B)(3) class. The plaintiffs filed
a motion for summary judgment as to the (B)(2) class which was
granted by the court on September 8, 2010. The Company filed a
notice of appeal on October 6, 2010.
The Company believes the action is without merit, and intends to
defend it vigorously. The ultimate outcome of the action cannot
be predicted with certainty.
CNO FINANCIAL: Appeal in "Yue" Class Suit Remains Pending
---------------------------------------------------------
Appeals in the lawsuit filed by Celedonia X. Yue against CNO
Financial Group, Inc., formerly Conseco, Inc., remains pending,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
On March 4, 2008, a complaint was filed in the United States
District Court for the Central District of California, Celedonia
X. Yue, M.D. on behalf of the class of all others similarly
situated, and on behalf of the General Public v. Conseco Life
Insurance Company, successor to Philadelphia Life Insurance
Company and formerly known as Massachusetts General Life Insurance
Company, Cause No. CV08-01506 CAS. Plaintiff in this putative
class action owns a Valulife universal life policy insuring the
life of Ruth S. Yue originally issued by Massachusetts General
Life Insurance Company in 1995. Plaintiff is claiming breach of
contract on behalf of the proposed national class and seeks
injunctive and restitutionary relief pursuant to California
Business & Professions Code Section 17200 and declaratory relief.
The putative class consists of all owners of Valulife and Valuterm
universal life insurance policies issued by either Massachusetts
General or Philadelphia Life and that were later acquired and
serviced by Conseco Life. Plaintiff alleges that members of the
class will be damaged by increases in the cost of insurance (a
non-guaranteed element) that are set to take place in the twenty
first policy year of Valulife and Valuterm policies. No such
increases have yet been applied to the subject policies.
During 2010, Conseco Life voluntarily agreed not to implement the
cost of insurance rate increase at issue in this litigation and is
following a process with respect to any future cost of insurance
rate increases as set forth in a regulatory settlement agreement.
Plaintiff filed a motion for certification of a nationwide class
and a California state class. On December 7, 2009, the court
granted that motion. On October 8, 2010, the court dismissed the
causes of actions alleged in the California state class. On
January 19, 2011, the court granted the plaintiff's motion for
summary judgment as to the declaratory relief claim and on
February 2, 2011, the court issued an advisory opinion, in the
form of a declaratory judgment, as to what, in its view, Conseco
Life could consider in implementing future cost of insurance rate
increases related to its Valulife and Valuterm block of policies.
On February 17, 2011, Conseco Life filed notice that it is
appealing the court's January 19, 2011 decision. On March 3,
2011, the plaintiff filed notice that she is appealing the court's
decision to dismiss the California causes of action.
The Company believes the action is without merit, and intends to
defend it vigorously. The ultimate outcome of the action cannot
be predicted with certainty.
CNO FINANCIAL: Consolidated Suit Trial Still Set for May 7, 2012
----------------------------------------------------------------
On December 24, 2008, a purported class action was filed in the
U.S. District Court for the Northern District of California,
Cedric Brady, et. al. individually and on behalf of all other
similarly situated v. Conseco, Inc. and Conseco Life Insurance
Company Case No. 3:08-cv-05746. The plaintiffs allege that
Conseco Life and Conseco, Inc. committed breach of contract and
insurance bad faith and violated various consumer protection
statutes in the administration of various interest sensitive whole
life products sold primarily under the name "Lifetrend" by
requiring the payment of additional cash amounts to maintain the
policies in force and by making changes to certain non-guaranteed
elements in their policies. On April 23, 2009, the plaintiffs
filed an amended complaint adding the additional counts of breach
of fiduciary duty, fraud, negligent misrepresentation, conversion
and declaratory relief. On May 29, 2009, Conseco, Inc. and
Conseco Life filed a motion to dismiss the amended complaint. On
July 29, 2009, the court granted in part and denied in part the
motion to dismiss. The court dismissed the allegations that
Conseco Life violated various consumer protection statutes, the
breach of fiduciary duty count, and dismissed Conseco, Inc. for
lack of personal jurisdiction. On October 15, 2009, Conseco Life
filed a motion with the Judicial Panel on Multidistrict Litigation
("MDL"), seeking the establishment of an MDL proceeding
consolidating this case and the McFarland case into a single
action. On February 3, 2010, the Judicial Panel on MDL ordered
this case be consolidated for pretrial proceedings. On July 7,
2010, plaintiffs filed an amended motion for class certification
of a nationwide class and a California state class. The Company
filed its motion in opposition on July 21, 2010. On October 6,
2010, the court granted the motion for certification of a
nationwide class and denied the motion for certification of a
California state class. Trial is set for May 7, 2012. The
Company believes the action is without merit and intends to defend
it vigorously. The ultimate outcome of the action cannot be
predicted with certainty.
On July 2, 2009, a purported class action was filed in the U.S.
District Court for the Middle District of Florida, Bill W.
McFarland, and all those similarly situated v. Conseco Life
Insurance Company, Case No. 3:09-cv-598-J-32MCR. The plaintiff
alleges that Conseco Life committed breach of contract and has
been unjustly enriched in the administration, including changes to
certain non-guaranteed elements, of various interest sensitive
whole life products sold primarily under the name "Lifetrend."
The plaintiff seeks declaratory and injunctive relief,
compensatory damages, punitive damages and attorney fees. On
February 3, 2010, the Judicial Panel on MDL ordered this case be
consolidated with the Brady case for pretrial proceedings in the
Northern District of California Federal Court. On July 7, 2010,
plaintiffs filed an amended motion for class certification of a
nationwide class and a California state class. The Company filed
its motion in opposition on July 21, 2010. On October 6, 2010,
the court granted the motion for certification of a nationwide
class and denied the motion for certification of a California
state class. Trial is set for May 7, 2012. The Company believes
the action is without merit and intends to defend it vigorously.
The ultimate outcome of the action cannot be predicted with
certainty.
No further updates were provided in CNO Financial Group, Inc.'s
August 1, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
CNO FINANCIAL: Awaits Final OK of Annuity Marketing Suit Deal
-------------------------------------------------------------
CNO Financial Group, Inc. is awaiting final approval of the
settlement reached in a consolidated class action over its
annuity marketing and sales practices, according to the Company's
August 1, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
On November 17, 2005, a complaint was filed in the United States
District Court for the Northern District of California, Robert H.
Hansen, an individual, and on behalf of all others similarly
situated v. Conseco Insurance Company, an Illinois corporation
f/k/a Conseco Annuity Assurance Company, Cause No. C0504726.
Plaintiff in this putative class action purchased an annuity in
2000 and is claiming relief on behalf of the proposed national
class for alleged violations of the Racketeer Influenced and
Corrupt Organizations Act; elder abuse; unlawful, deceptive and
unfair business practices; unlawful, deceptive and misleading
advertising; breach of fiduciary duty; aiding and abetting of
breach of fiduciary duty; and unjust enrichment and imposition of
constructive trust. On January 27, 2006, a similar complaint was
filed in the same court entitled Friou P. Jones, on Behalf of
Himself and All Others Similarly Situated v. Conseco Insurance
Company, an Illinois company f/k/a Conseco Annuity Assurance
Company, Cause No. C06-00537. Mr. Jones had purchased an annuity
in 2003. Each case alleged that the annuity sold was
inappropriate and that the annuity products in question are
inherently unsuitable for seniors age 65 and older. On March 3,
2006, a first amended complaint was filed in the Hansen case
adding causes of action for fraudulent concealment and breach of
the duty of good faith and fair dealing. In an order dated
April 14, 2006, the court consolidated the two cases under the
original Hansen cause number and retitled the consolidated action:
In re Conseco Insurance Co. Annuity Marketing & Sales Practices
Litig. A settlement in principle has been reached in this case,
and on April 22, 2011, the court granted preliminary approval of
the settlement.
No further updates were reported in the Company's latest SEC
filing.
CNO FINANCIAL: Plumbers and Pipefitters Union Suit Dismissed
------------------------------------------------------------
The purported class action lawsuit commenced by the Plumbers and
Pipefitters Local Union No. 719 Pension Trust Fund has been
dismissed with prejudice following the lead plaintiff's dismissal
of its appeal from a prior court ruling dismissing the case,
according to CNO Financial Group, Inc.'s August 1, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2011.
On August 6, 2009, a purported class action complaint was filed in
the United States District Court for the Southern District of New
York, Plumbers and Pipefitters Local Union No. 719 Pension Trust
Fund, on behalf of itself and all others similarly situated v.
Conseco, Inc., et al., Case No. 09-CIV-6966, on behalf of
purchasers of the Company's common stock during the period from
August 4, 2005, to March 17, 2008 (the "Class Period"). The
complaint charges CNO and certain of its officers and directors
with violations of the Securities Exchange Act of 1934. On
June 2, 2010, the lead plaintiff filed a second amended complaint.
The amended complaint alleges that, during the Class Period, the
defendants issued numerous statements regarding the Company's
financial performance. As alleged in the complaint, these
statements were materially false and misleading because the
defendants misrepresented and/or failed to disclose the following
adverse facts, among others: (i) that the Company was reporting
materially inaccurate revenue figures; (ii) that the Company's
reported financial results were materially misstated and did not
present the true operating performance of the Company; (iii) that
the Company's shareholders' equity was materially overstated
during the Class Period, including the overstatement of
shareholders' equity by $20.6 million at December 31, 2006; and
(iv) as a result of the foregoing, the defendants lacked a
reasonable basis for their positive statements about the Company,
its corporate governance practices, its prospects and earnings
growth. On August 2, 2010, the Company filed a motion to dismiss
the amended complaint.
On March 29, 2011, the court granted the Company's motion to
dismiss, and on April 29, 2011, the lead plaintiff filed a notice
of appeal. The lead plaintiff subsequently agreed to dismiss the
appeal and the case has been dismissed with prejudice.
CNO FINANCIAL: "Rowe" Suit Remains Pending in Illinois
------------------------------------------------------
A purported class action lawsuit commenced by Samuel Rowe and
Estella Rowe against a subsidiary of CNO Financial Group, Inc.,
remains pending in Illinois, according to the Company's August 1,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
On January 26, 2009, a purported class action complaint was filed
in the United States District Court for the Northern District of
Illinois, Samuel Rowe and Estella Rowe, individually and on behalf
of themselves and all others similarly situated v. Bankers Life &
Casualty Company and Bankers Life Insurance Company of Illinois,
Case No. 09CV491. The plaintiffs are alleging violation of
California Business and Professions Code Sections 17200 et seq.
and 17500 et seq., breach of common law fiduciary duty, breach of
implied covenant of good faith and fair dealing and violation of
California Welfare and Institutions Code Section 15600 on behalf
of the proposed national class and seek injunctive relief,
compensatory damages, punitive damages and attorney fees. The
plaintiff alleges that the defendants used an improper and
misleading sales and marketing approach to seniors that fails to
disclose all facts, misuses consumers' confidential financial
information, uses misleading sales and marketing materials,
promotes deferred annuities that are fundamentally inferior and
less valuable than readily available alternative investment
products and fails to adequately disclose other principal risks
including maturity dates, surrender penalties and other
restrictions which limit access to annuity proceeds to a date
beyond the applicants actuarial life expectancy. Plaintiffs have
amended their complaint attempting to convert this from a
California only class action to a national class action. In
addition, the amended complaint adds causes of action under the
Racketeer Influenced and Corrupt Organization Act ("RICO"); aiding
and abetting breach of fiduciary duty and for unjust enrichment.
On September 13, 2010, the court dismissed the plaintiff's RICO
claims. On October 25, 2010, the plaintiffs filed a second
amended complaint re-alleging their RICO claims. A hearing date
on the motion for class certification has not been set.
No further updates were reported in the Company's latest SEC
filing.
The Company believes the action is without merit, and intends to
defend it vigorously. The ultimate outcome of the action cannot
be predicted with certainty.
COCA-COLA CO: Consolidated Georgia Class Suit Dismissed
-------------------------------------------------------
The consolidated lawsuit against The Coca-Cola Company pending in
Georgia has been dismissed with prejudice and the plaintiff class
released the defendants from all claims, according to the
Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended July 1,
2011.
Shortly following the announcement of the agreement for the
Company's acquisition of Coca-Cola Enterprises Inc.'s North
American operations, purported shareowners of CCE filed three
putative class action lawsuits in the Superior Court of Fulton
County, Georgia, against the Company, CCE and the members of the
Board of Directors of CCE. These lawsuits were subsequently
consolidated into one action styled In Re The Coca-Cola Company
Shareholder Litigation (Civil Action No. 2010cv182035). On
May 17, 2010, the consolidated action was transferred to the
Business Case Division of the Fulton County Superior Court.
On June 3, 2010, an amended consolidated complaint was filed. On
July 6, 2010, the Company and all other defendants answered the
amended consolidated complaint and filed motions to dismiss the
amended consolidated complaint and for an order staying discovery.
On July 6, 2010, the plaintiffs filed a motion for class
certification.
In the amended consolidated complaint, the plaintiffs alleged,
among other things, that by virtue of its stock ownership in and
business dealings with CCE, the Company controlled and dominated
CCE during the relevant period and therefore owed to CCE a duty of
entire fairness and a duty not to misuse its control of CCE for
its own ends which the Company allegedly breached because, among
other things, the transaction was not entirely fair; and that the
Company, CCE and CCE's directors violated Delaware law by not
submitting the transaction to a separate vote of CCE's
shareowners.
In the amended consolidated complaint, the plaintiffs sought a
judgment enjoining the closing of the transaction and declaring
the transaction void (this request for relief became moot upon the
closing of the CCE transaction on October 2, 2010), and ordering
rescission, requiring disgorgement of profits, awarding damages,
awarding reasonable fees and expenses of counsel, and granting
such other relief as the court deemed just and proper.
Pursuant to the MOU, and in consideration for the settlement of
the consolidated Delaware litigation and the consolidated Georgia
litigation, prior to executing the Settlement Stipulation, the
parties to the CCE transaction made certain amendments to the
merger agreement and certain supplemental disclosures in
connection with the proxy statement sent to the CCE shareowners
soliciting approval of the merger. In addition, as contemplated
by the MOU, the plaintiffs sought an award of attorneys' fees. On
June 8, 2011, the Georgia court issued an order and final judgment
approving the class and the settlement. Upon the court's approval
of the settlement, and as contemplated by the Settlement
Stipulation, the consolidated Georgia litigation was dismissed
with prejudice and the plaintiff class released the defendants
from all claims under federal and state law that were or could
have been asserted in the consolidated Georgia litigation or the
consolidated Delaware litigation or which arose out of or related
to the transactions contemplated by the merger. As required under
the merger agreement with CCE, the Company has paid approximately
$2.4 million in plaintiffs' attorneys' fees, representing 50
percent of the amount awarded by the court, and considers this
matter concluded.
COCA-COLA CO: Delaware Consolidated Class Suit Dismissed
--------------------------------------------------------
The consolidated lawsuit against The Coca-Cola Company pending in
Delaware has been dismissed with prejudice following final court
approval of a settlement, according to the Company's August 1,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended July 1, 2011.
Shortly following the announcement of the agreement for the
Company's acquisition of Coca-Cola Enterprises Inc.'s North
American operations, purported shareowners of CCE filed five
substantially identical putative class action lawsuits in the
Court of Chancery of the State of Delaware against CCE, the
members of the Board of Directors of CCE and the Company. These
lawsuits were subsequently consolidated into one action styled In
Re CCE Shareholders Litigation (Consolidated C.A. No. 5291-VCN).
On March 31, 2010, the plaintiffs filed a consolidated complaint.
On June 25, 2010, the plaintiffs filed an amended consolidated
complaint.
In the amended consolidated complaint, the plaintiffs alleged,
among other things, that CCE, CCE's directors and the Company
violated Delaware law by not submitting the sale of CCE's North
American operations to a separate vote of CCE's shareowners; and
that CCE's directors breached their fiduciary duties to CCE and
its shareowners by approving the transaction for grossly
inadequate consideration, and that the Company aided and abetted
such breach. The plaintiffs further alleged that by virtue of its
stock ownership in CCE, representation on the Board of Directors
of CCE and various agreements and business relationships with CCE,
the Company dominated and controlled CCE during the relevant
period and therefore had a fiduciary duty to CCE's public
shareowners which the Company breached because, among other
things, the transaction was not entirely fair and that both CCE
and the Company failed to adequately disclose certain aspects of
the transaction, the disclosure of which would have been necessary
to fully inform a decision to vote for or against same.
In the amended consolidated complaint, the plaintiffs sought a
judgment enjoining the closing of the transaction and declaring
the transaction unlawful and unenforceable (this request for
relief became moot upon the closing of the CCE transaction on
October 2, 2010), and ordering rescission, directing defendants to
account for all damages, profits, special benefits and unjust
enrichment, awarding the costs and disbursements of the action,
including reasonable attorneys' fees, accountants' and experts'
fees, costs and expenses, and granting such other relief as the
court deemed just and proper.
On July 15, 2010, the Company, CCE and the other defendants filed
separate answers to the amended consolidated complaint.
On September 3, 2010, the parties to the consolidated Georgia
litigation executed a memorandum of understanding (the "MOU")
containing the terms for the parties' agreement in principle to
settle the lawsuits. On January 14, 2011, the parties to the
consolidated Delaware litigation and the consolidated Georgia
litigation entered into a Stipulation and Agreement of Compromise
and Settlement to resolve, subject to court approval, the
consolidated Delaware litigation and the consolidated Georgia
litigation. Pursuant to the Settlement Stipulation, the parties
in the consolidated Delaware litigation agreed to use their best
efforts to obtain the dismissal with prejudice of the consolidated
Delaware litigation within five business days of the final
approval of the settlement by the Georgia court. On
June 8, 2011, the Georgia court issued an order and final judgment
approving the class and the settlement and the consolidated
Delaware litigation has been dismissed with prejudice.
COMCAST BUSINESS: Class Action Settlement Gets Preliminary Okay
---------------------------------------------------------------
Nick McCann at Courthouse News Service reports that Comcast must
pay $100 for each robocall placed to Washington businesses under
the terms of a settlement a federal judge preliminarily approved
this week.
Four business owners sued Comcast in Seattle last year over the
company's use of automatic dialing systems to sell its business-
class service.
In March, the parties participated in mediation and reached a
settlement after several weeks of negotiations.
Comcast agreed to pay up to $3.8 million to resolve the matter,
which affords about $100 to each class member per received
robocall. The parties determined that there are a total of
148,843 class members.
Additionally, the businesses that served as class representatives
will receive $30,000 for their time and effort. U.S. District
Judge Robert Lasnik found the settlement was "fair, reasonable and
adequate," and ordered its preliminary approval on August 1, 2011.
A copy of the Order Preliminarily Approving Class Action
Settlement, Notice to Class Members and Scheduling Final Approval
Hearing in Hartman, et al. v. Comcast Business Communications,
LLC, et al., Case No. 10-cv-00413 (W.D. Wash.), is available at:
http://is.gd/L8B5f2
COMMUNITY HEALTH: Defends Securities Class Suits in Tennessee
-------------------------------------------------------------
Community Health Systems, Inc., is defending itself from three
shareholder lawsuits filed in Tennessee alleging that it made
misleading statements resulting to artificially inflated prices
for the Company's common stock, according to the Company's August
1, 2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
Three purported class action shareholder federal securities cases
have been filed in the United States District Court for the Middle
District of Tennessee namely, Norfolk County Retirement System v.
Community Health Systems, Inc., Wayne T. Smith and W. Larry Cash,
filed May 5, 2011; De Zheng v. Community Health Systems, Inc.,
Wayne T. Smith and W. Larry Cash, filed May 12, 2011; and
Minneapolis Firefighters Relief Association v. Community Health
Systems, Inc., Wayne T. Smith, W. Larry Cash and Thomas Mark
Buford, filed June 2, 2011. All three seek class certification on
behalf of purchasers of the Company's common stock between
July 27, 2006, and April 11, 2011, and allege that misleading
statements resulted in artificially inflated prices for the
Company's common stock. Two shareholder derivative actions have
also been filed in the United States District Court for the Middle
District of Tennessee; Plumbers and Pipefitters Local Union No.
630 Pension Annuity Trust Fund v. Wayne T. Smith, W. Larry Cash,
T. Mark Buford, John A. Clerico, James S. Ely III, John A. Fry,
William Norris Jennings, Julia B. North and H. Mitchell Watson,
Jr., filed May 24, 2011, and Roofers Local No. 149 Pension Fund v.
Wayne T. Smith, W. Larry Cash, John A. Clerico, James S. Ely, III,
John A. Fry, William Norris Jennings, Julia B. North and H.
Mitchell Watson, Jr., filed June 21, 2011. These two cases allege
breach of fiduciary duty arising out of allegedly improper
inpatient admission practices, mismanagement, waste and unjust
enrichment. The Company believes all of these matters are without
merit and will vigorously defend them.
COMMUNITY HEALTH: Status Hearing Motion Pending in "Roswell" Suit
-----------------------------------------------------------------
Community Health Systems, Inc., is awaiting a ruling on its motion
seeking a status hearing in the putative class action lawsuit
pending in New Mexico, according to the Company's August 1, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended June 30, 2011.
On April 19, 2009, the Company was served in Roswell, New Mexico,
with an answer and counterclaim in the case of Roswell Hospital
Corporation d/b/a Eastern New Mexico Medical Center vs. Patrick
Sisneros and Tammie McClain (sued as Jane Doe Sisneros). The case
was originally filed as a collection matter. The counterclaim was
filed as a putative class action and alleged theories of breach of
contract, unjust enrichment, misrepresentation, prima facie tort,
Fair Trade Practices Act and violation of the New Mexico RICO
statute. On May 7, 2009, the hospital filed a notice of removal
to federal court. On July 27, 2009, the case was remanded to
state court for lack of a federal question. A motion to dismiss
and a motion to dismiss misjoined counterclaim plaintiffs were
filed on October 20, 2009. These motions were denied. Extensive
discovery has been conducted. A motion for class certification
for all uninsured patients was heard on March 3 through March 5,
2010, and on April 13, 2010, the state district court judge
certified the case as a class action. Discovery is ongoing. A
hearing was conducted on March 1, 2011, to assess the sufficiency
of the methodology used to determine class damages. On May 13,
2011, the court ordered plaintiffs to respond by June 27, 2011,
with a definitive statement of how plaintiffs intend to remedy
their failure to present an acceptable methodology. On July 5,
2011, the Company objected to plaintiffs' response and on July 18,
2011, the Company filed a motion seeking a status hearing. The
Company says it is vigorously defending this action.
CONVERGYS CORP: Final Settlement Hearing Set for Sept. 27
---------------------------------------------------------
The United States District Court for the Northern District of
Texas has scheduled a hearing for September 27, 2011, to consider
final approval of a settlement in the consolidated lawsuit against
a unit of Convergys Corporation, according to the Company's
August 1, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
Several related class action lawsuits were filed in the United
States District Court for the Northern District of Texas in 2001
on behalf of purchasers of common stock of the Company's
subsidiary, Intervoice, Inc., during the period from October 12,
1999, through June 6, 2000 (the Class Period). Plaintiffs filed
claims, which were consolidated into one proceeding under Sections
10(b) and 20(a) of the Exchange Act and SEC Rule 10b-5 against
Intervoice (a subsidiary of the Company since 2008) as well as
certain named former officers and directors of Intervoice on
behalf of the alleged class members. In the complaint, plaintiffs
claim that Intervoice and the named former officers and directors
issued false and misleading statements during the Class Period
concerning the financial condition of Intervoice, the results of a
merger with another company and the alleged future business
projections of Intervoice. Plaintiffs have asserted that these
alleged statements resulted in artificially inflated stock prices.
The District Court dismissed the plaintiffs' complaint because it
lacked the degree of specificity and factual support to meet the
pleading standards applicable to federal securities litigation.
On appeal, the United States Court of Appeals for the Fifth
Circuit affirmed the dismissal in part and reversed in part. The
Fifth Circuit remanded a limited number of issues for further
proceedings in the District Court. In 2006, the District Court
granted the plaintiffs' motion to certify a class of purchasers of
Intervoice stock during the Class Period. Intervoice appealed and
in 2008, the Fifth Circuit vacated the District Court's class-
certification order and remanded the case to the District Court
for further consideration. In October 2009, the District Court
denied the plaintiffs' motion to certify a class. In January
2010, the Fifth Circuit granted the plaintiffs' petition for
permission to appeal the denial of class certification.
The Company and the plaintiffs signed a term sheet to settle and
terminate the lawsuit. The District Court has granted preliminary
approval of the parties' joint stipulation of settlement and has
scheduled a hearing for September 27, 2011, to consider a motion
for final approval of the settlement. The Company expects that
the settlement will not have a material adverse impact on its
results of operations or financial condition and believes its
reasonable range of loss does not exceed amounts accrued at
June 30, 2011.
E.I. DUPONT: Faces Numerous Class Actions Over Imprelis
-------------------------------------------------------
Courthouse News Service reports that DuPont faces a slew of class
actions that claim its Imprelis herbicide killed trees and ruined
millions of dollars of landscaping across the country; 17 such
class actions have been filed in the past 3 weeks.
A copy of the Complaint in Gingold v. E.I. Du Pont de Nemours an
Company, Case No. 11-cv-02166 (Kyle, J.), is available at:
http://www.courthousenews.com/2011/08/03/Imprelis.pdf
The Plaintiff is represented by:
Stephen J. Foley, Esq.
Thomas W. Pahl, Esq.
Jeffrey D. Klobucar, Esq.
FOLEY & MANSFIELD, PLLP
250 Marquette Avenue, Suite 1200
Minneapolis, MN 55401
Telephone: (612) 338-8788
E-mail: sfoley@foleymansfield.com
tpahl@foleymansfield.com
jklobucar@foleymansfield.com
- and -
Karl L. Cambronne, Esq.
Jeffrey D. Bores, Esq.
Bryan L. Bleichner, Esq.
CHESTNUT CAMBRONNE PA
17 Washington Avenue North, Suite 300
Minneapolis, MN 55401
Telephone: (612) 339-7300
E-mail: kcambronne@chestnutcambronne.com
jbores@chestnutcambronne.com
bbleichner@chestnutcambronne.com
ENCORE CAPITAL: Awaits Final OK of Deals Resolving Suits vs. Units
------------------------------------------------------------------
Encore Capital Group, Inc., is awaiting final approval of a
settlement in a lawsuit commenced by Andrea Brent and two other
pending lawsuits filed against its subsidiaries, according to the
Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
On May 19, 2008, an action captioned Brent v. Midland Credit
Management, Inc. et al., was filed in the United States District
Court for the Northern District of Ohio Western Division, in which
the plaintiff, Andrea Brent, has filed a class action counter-
claim against the Company's subsidiaries Midland Credit
Management, Inc. and Midland Funding LLC (the "Midland
Defendants"). The complaint alleges that the Midland Defendants'
business practices violated consumers' rights under the Fair Debt
Collection Practices Act ("FDCPA") and the Ohio Consumer Sales
Practices Act. The plaintiff is seeking actual and statutory
damages for the class of Ohio residents, plus attorney's fees and
costs of class notice and class administration. On August 11,
2009, the court issued an order partially granting plaintiff's
motion for summary judgment and entering findings adverse to the
Midland Defendants on certain of plaintiff's claims. The Midland
Defendants subsequently moved the court to reconsider the order
and were partially successful. However, because the court did not
completely reverse the August 11 order, certain portions of the
order remain subject to reversal only on appeal. On February 22,
2010, the District Court denied plaintiff's attempts to enlarge
the case to include a national class of consumers, and ordered the
parties to brief issues relating to whether a statewide class
should be certified. On November 4, 2010, the court granted in
part, and denied in part, plaintiff's motion for class
certification of a statewide class.
On February 10, 2011, the parties reached an agreement in
principle to settle this lawsuit, as well as two other pending
lawsuits in the Northern District of Ohio -- Franklin v. Midland
Funding LLC and Vassalle v. Midland Funding LLC, on a national
class basis, subject to entering into a definitive settlement
agreement and obtaining court approval after notice to the class.
On March 9, 2011, the parties entered into a final settlement
agreement, which was preliminarily approved by the court on
March 11, 2011. On July 11, 2011, the court held a final approval
hearing with respect to the settlement, and the parties are
awaiting the court's decision.
EQT PRODUCTION: Accused of Misleading Landowners on Settlement
--------------------------------------------------------------
Steve Szkotak, writing for The Associated Press, reports that an
energy company made false claims in attempts to settle with
southwest Virginia residents for coalbed methane drilled from
their land, a federal magistrate judge ruled.
The ruling is part of a potential class action involving thousands
of landowners in six Virginia coalfields counties who attorneys
claim were cheated out of hundreds of millions of dollars in
royalty payments.
The five separate legal actions in the U.S. District Court in
Abingdon are aimed at EQT Production Co. and CNX Gas Co.,
Pittsburgh-area energy companies that have thousands of natural
gas wells in Appalachia.
They have denied the allegations.
Attorneys for the landowners asked U.S. Magistrate Judge Pamela
Meade Sargent to stop EQT from soliciting settlements with
potential plaintiffs, and she concluded company representatives
misled landowners. She said the company could write to landowners
provided they fully explained their legal options and make the
correspondence available to the court.
"The court further finds that action is necessary to protect
putative class members from unwittingly giving up any right to
relief they may obtain through this case based on false
information provided by EQT," Judge Sargent wrote in an opinion
dated July 29.
An attorney seeking the class action status for thousands of
landowners said the opinion underscores attempts by the energy
companies to deny residents full compensation for natural gas
drilling on their land.
"It's a recognition by the court that EQT has been lying on a
systematic basis to these class members," Don Barrett said on
Aug. 3. "They want it to go away."
A spokesman for EQT denied that company representatives made false
presentations to landowners and said it would appeal.
"As far as making false statements, we didn't or don't tell
landowners the only way they can get royalties out of this was to
sign split agreements," said Kevin West, the EQT spokesman.
Under a split agreement, the landowner agrees to divide royalties
held in escrow with energy companies. The escrow account is
believed to be approximately $26 million.
"That's chicken feed compared to what they owe," Mr. Barrett said
of the energy companies.
The lawsuits allege the companies drilled thousands of wells in
southwest Virginia's coalbed to remove methane gas without
obtaining legal claim to the resource from the landowners. They
argued the mineral rights were held by the coal companies.
The Virginia Gas and Oil Board ultimately granted conditional
leases and placed royalties in the escrow account because of
conflicting claims. The royalties placed in the account amounted
to one-eighth of net proceeds of the drilling.
Attorneys for the landowners said the state panel subjected the
landowners to "an involuntary lease" and established a below-
market royalty rate.
The Virginia Supreme Court, in a 2004 ruling, found that the
methane gas is a "distinct mineral estate" from coal, concluding
the landowners owned the rights to natural gas removed from their
properties.
While the natural gas legal claims have survived motions to
dismiss them, a judge has yet to decide whether to certify them as
a class action. The claim is shaping up to be an epic legal
battle.
Mr. Barrett, a Lexington, Miss., attorney who was involved in
successful class actions against U.S. tobacco companies, is among
the half dozen attorneys from New York, Los Angeles and elsewhere
who have established an office in Abingdon. They are working
under the name of "Virginia Gas Owners Litigation Group."
Mr. Barrett estimates the class action could involve 10,000-15,000
landowners in the counties of Dickenson, Buchanan, Lee, Russell,
Scott and Wise.
Others have said the claims could approach $1 billion or more.
The Bristol Herald Courier won a Pulitzer Prize for Daniel
Gilbert's reporting on the mismanagement of natural gas royalties
owed to landowners in Virginia.
GENWORTH FINANCIAL: Continues to Defend "Goodman" Suit
------------------------------------------------------
Genworth Financial, Inc., continues to defend itself against a
putative class action lawsuit pending in New York, according to
the Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
In December 2009, one of the Company's non-insurance subsidiaries,
one of the subsidiary's officers and Genworth Financial, Inc. were
named in a putative class action lawsuit captioned Michael J.
Goodman and Linda Brown v. Genworth Financial Wealth Management,
Inc., et al, in the United States District Court for the Eastern
District of New York. In response to the Company's motion to
dismiss the complaint in its entirety, the Court granted on
March 30, 2011, the motion to dismiss the state law fiduciary duty
claim and denied the motion to dismiss the remaining federal
claims.
The Company says it continues to vigorously defend this action.
GERBER SCIENTIFIC: Signs MOU to Settler Merger-Related Suit
-----------------------------------------------------------
Gerber Scientific, Inc., entered into a memorandum of
understanding to settle a merger-related class action lawsuit,
according to the Company's August 1, 2011, Form 8-K filing with
the U.S. Securities and Exchange Commission.
Gerber Scientific, Inc. entered into an Agreement and Plan of
Merger with Vector Knife Holdings (Cayman), Ltd. ("Parent") and
Knife Merger Sub, Inc., controlled affiliates of Vector Capital
Corporation ("Vector"), on June 10, 2011. The Merger Agreement
provides for the merger (the "Merger") of Merger Sub with and into
the Company, with the Company surviving the Merger as a wholly
owned subsidiary of Parent.
As previously disclosed, the Company and Merger Sub were served
with a purported shareholder class action complaint. The lawsuit
was filed in Superior Court in the Judicial District of Tolland at
Rockville in the State of Connecticut and names as defendants the
Company, the Company's directors, Vector Capital Corporation and
Merger Sub. The lawsuit seeks, among other relief, certain
injunctive relief, including enjoining of the Merger, and damages.
It also purports to seek recovery of the costs of the action,
including reasonable attorneys fees.
On July 29, 2011, the defendants in the lawsuit entered into a
Memorandum of Understanding with respect to claims asserted in the
lawsuit. Pursuant to the MOU, the Company has agreed, among other
things, to provide certain amended disclosures to supplement the
proxy statement. The Company has also agreed to pay the
plaintiff's counsel's attorneys' fees in an amount to be awarded
by the Superior Court in the Judicial District of Tolland at
Rockville, but in no event more than $375,000.
The defendants have denied, and continue to deny, that any of them
has committed or has threatened to commit any wrongdoing,
violation of law or breach of duty to the plaintiff in this
lawsuit, the putative class, or anyone, that they have any
liability or owe any damages of any kind to the plaintiff or the
putative class, and that any additional disclosures are required
under any applicable rule, regulation, statute, or law, but are
entering into the settlement solely because they consider it
desirable that the lawsuit be settled and dismissed with prejudice
in order to (i) eliminate the burden, inconvenience, expense, risk
and distraction of further litigation, (ii) terminate all of the
claims which were or could have been asserted against the
defendants in the lawsuit and (iii) thereby permit the Merger to
proceed without risk of injunctive or other relief.
When effective, the settlement as contemplated by the MOU will
dismiss all of the plaintiff's claims with prejudice and release
all defendants from all claims related to the Merger. However,
the settlement as contemplated by the MOU is subject to the
approval of the Superior Court in the Judicial District of Tolland
at Rockville. A hearing is expected to be scheduled at which the
Superior Court in the Judicial District of Tolland at Rockville
will consider the fairness, reasonableness, and adequacy of the
settlement as contemplated by the MOU. The Company says there can
be no assurance that the Superior Court in the Judicial District
of Tolland at Rockville will approve the settlement as
contemplated by the MOU. In such event, the settlement as
contemplated by the MOU may be terminated.
GREAT ATLANTIC: "LaMarca" Class Suit Remains Stayed
---------------------------------------------------
On June 24, 2004, a class action complaint captioned LaMarca et al
v. The Great Atlantic & Pacific Tea Company, Inc., was filed in
the Supreme Court of the State of New York against The Great
Atlantic & Pacific Tea Company, Inc., d/b/a A&P, The Food
Emporium, and Waldbaum's alleging violations of the overtime
provisions of the New York Labor Law. Three named plaintiffs,
Benedetto LaMarca, Dolores Guiddy, and Stephen Tedesco, alleged on
behalf of a class that the Company failed to pay overtime wages to
full-time hourly employees who were either required or permitted
to work more than 40 hours per week. This matter has been stayed
by the Company's bankruptcy filing and is a claim that is subject
to compromise.
No further updates were reported in the Company's August 1, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended June 18, 2011.
HARTE HANKS: Unit Set Up $7-Mil. Fund for "Gattuso" Suit Deal
-------------------------------------------------------------
A unit of Harte-Hanks, Inc., paid $7 million in June 2011 to
establish a class settlement fund in connection with its agreement
in the lawsuit filed by Frank Gattuso et al., according to the
Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
On January 25, 2010, Harte-Hanks Shoppers, Inc. (Shoppers), a
California corporation and a subsidiary of Harte-Hanks, Inc.
(Harte-Hanks), reached an agreement in principle with Shoppers
employee Frank Gattuso and former employee Ernest Sigala,
individually and on behalf of a certified class, to settle and
resolve a previously disclosed class action lawsuit filed in 2001
(Frank Gattuso et al. v. Harte-Hanks Inc. et al.)
This agreement in principle was reduced to a class settlement
agreement executed by the parties, and received final approval
from the court on May 26, 2011. Pursuant to the settlement
agreement, Shoppers has established a class settlement fund of
$7.0 million. In return, each member of the class, including
Gattuso and Sigala, have released all claims against Shoppers and
its affiliates that in any way arose from or related to the
matters which were the subject of, or could have been the subject
of, the claims alleged in the class action lawsuit. Notices to
the class members were sent in the first and second quarters of
2011. Payments under the class settlement agreement from the
class settlement fund began in late July 2011, and any unclaimed
portion will revert back to Shoppers.
On March 23, 2001, Shoppers employee Frank Gattuso and former
employee Ernest Sigala filed a class action against Shoppers in
Los Angeles County Superior Court, claiming, among other related
allegations, that Shoppers failed to comply with California Labor
Code Section 2802 ("CLC 2802"), which requires an employer to
indemnify employees for expenses incurred on behalf of the
employer. The plaintiffs alleged that Shoppers failed to reimburse
them for expenses of using their automobiles as outside sales
representatives, and failed to accurately itemize these expenses
on plaintiffs' wage statements. The class, as certified by the
trial court, was limited to California Harte-Hanks outside sales
representatives who were not separately reimbursed apart from
their base salary and commissions for the expenses they incurred
in using their own automobiles after early 1998. The plaintiffs
sought indemnification and compensatory damages, statutory
damages, exemplary damages, penalties, interest, costs of lawsuit,
and attorneys' fees. Shoppers filed a cross-complaint seeking a
declaratory judgment that the plaintiffs were indemnified for
their automobile expenses by the higher salaries and commissions
paid to them as outside sales representatives. On January 30,
2002, the trial court ruled that CLC 2802 requires employers to
reimburse employees for mileage and other expenses incurred in the
course of employment, but that an employer is permitted to pay
increased wages or commissions instead of indemnifying actual
expenses. On May 28, 2003, the trial court denied the plaintiffs'
motion for class certification. On October 27, 2005, the
California Court of Appeal issued a unanimous opinion affirming
the trial court's rulings, including the interpretation of CLC
2802 and denial of class certification. On November 23, 2005, the
Court of Appeal denied the plaintiffs' petition for rehearing. On
November 5, 2007, the California Supreme Court affirmed the trial
court's ruling that CLC 2802 permits lump sum reimbursement and
that an employer may satisfy its obligations to indemnify
employees for reasonable and necessary business expenses under CLC
2802 by paying enhanced taxable compensation. The Supreme Court
remanded the matter back to the trial court for further
proceedings related to class certification and directed the trial
court to consider whether the following issues could properly be
resolved on a class-wide basis: (1) did Shoppers adopt a practice
or policy of reimbursing outside sales representatives for
automobile expenses by paying them higher commission rates and
base salaries than it paid to inside sales representatives, (2)
did Shoppers establish a method to apportion the enhanced
compensation payments between compensation for labor performed and
expense reimbursement and (3) was the amount paid for expense
reimbursement sufficient to fully reimburse the employees for the
automobile expenses they reasonably and necessarily incurred. On
May 19, 2009, the trial court issued a partial class certification
order certifying a class action with respect to the first two
foregoing questions and denying class certification on the third
foregoing question.
During the fourth quarter of 2009, the Company accrued the full
$7.0 million associated with this agreement. In June of 2011, the
Company paid $7.0 million to establish the class settlement fund.
Based upon the claims received from the class members, the Company
reduced the accrual by $0.8 million and $0.5 million in the first
and second quarters of 2011, respectively, and has a $1.3 million
receivable on the Company's Consolidated Balance Sheet at June 30,
2011. The Company says it cannot predict the impact of future
developments relating to the settlement agreement and matters
covered therein, and any further developments within a particular
fiscal quarter may adversely impact its results of operations for
that quarter.
HOTEL-BOOKING SITES: Get Favorable Ruling in New Jersey Tax Case
----------------------------------------------------------------
Jeff D. Gorman at Courthouse News Service reports that priceline
and other hotel-booking Web sites cannot be sued by New Jersey
municipalities for occupancy taxes, the United States Court of
Appeals for the Third Circuit ruled.
Before sites like Priceline can book customers into rooms, they
first negotiate a wholesale rate with the individual hotels and
then make a profit by charging customers a higher rate.
In a class-action lawsuit for unpaid taxes, conversion and unjust
enrichment, Lyndhurst Township said it should be allowed to tax
the higher price paid by customers rather than the wholesale rate
that hotels charge the Web sites.
Against this claim, a bevy of defendants including Priceline,
Lowestfare.com, Travelocity, Expedia, Hotels.com, Hotwire, Cheap
Tickets and Orbitz attacked Lyndhurst's standing.
The defendants also pointed out that the New Jersey Division of
Taxation had already cleared them of liability to the tax.
A New Jersey federal judge agreed to dismiss the case, and the
Philadelphia-based 3rd Circuit affirmed on Aug. 2.
"As the state Legislature never granted Lyndhurst the power to
'collect and administer' (that is, to 'enforce') its hotel
occupancy tax, there is nothing to construe liberally in its
favor," Judge Thomas Ambro wrote for a three-judge panel.
"As a result, the statute cannot be interpreted (liberally or
otherwise) to give Lyndhurst implied powers that the state
Legislature decided not to confer on it."
A copy of the Opinion in The Township of Lyndhurst, New Jersey v.
Priceline.com Inc., et al., No. 09-2053 (3rd Cir.), is available
at:
http://www.ca3.uscourts.gov/opinarch/092053p.pdf
HSBC FINANCE: Awaits Court's Okay of Interchange Fees Suit Deal
---------------------------------------------------------------
HSBC Finance Corporation is awaiting court approval of its
settlement in a consolidated lawsuit over interchange fees,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
Since June 2005, HSBC Finance Corporation, HSBC North America, and
HSBC Holdings plc ("HSBC"), as well as other banks and Visa Inc.
and Master Card Incorporated, were named as defendants in four
class actions filed in Connecticut and the Eastern District of New
York; Photos Etc. Corp. et al. v. Visa U.S.A., Inc., et al. (D.
Conn. No. 3:05-CV-01007 (WWE)): National Association of
Convenience Stores, et al. v. Visa U.S.A., Inc., et al.(E.D.N.Y.
No. 05-CV 4520 (JG)); Jethro Holdings, Inc., et al. v. Visa
U.S.A., Inc. et al. (E.D.N.Y. No. 05-CV-4521 (JG)); and American
Booksellers Ass'n v. Visa U.S.A., Inc. et al. (E.D.N.Y. No. 05-CV-
5391 (JG)). Numerous other complaints containing similar
allegations (in which no HSBC entity is named) were filed across
the country against Visa Inc., MasterCard Incorporated and other
banks. These actions principally allege that the imposition of a
no-surcharge rule by the associations and/or the establishment of
the interchange fee charged for credit card transactions causes
the merchant discount fee paid by retailers to be set at
supracompetitive levels in violation of the Federal antitrust
laws. These lawsuits have been consolidated and transferred to
the Eastern District of New York. The consolidated case is: In re
Payment Card Interchange Fee and Merchant Discount Antitrust
Litigation, MDL 1720, E.D.N.Y. ("MDL 1720"). A consolidated,
amended complaint was filed by the plaintiffs on April 24, 2006,
and a second consolidated amended complaint was filed on
January 29, 2009.
The parties are engaged in discovery, motion practice and
mediation. On February 7, 2011, MasterCard Incorporated, Visa
Inc., the other defendants, including HSBC Finance Corporation,
and certain affiliates of the defendants entered into settlement
and judgment sharing agreements (the "Agreements") that provide
for the apportionment of certain defined costs and liabilities
that the defendants, including HSBC Finance Corporation and its
affiliates, may incur, jointly and/or severally, in the event of
an adverse judgment or global settlement of one or all of these
actions. The Agreements also cover any other potential or future
actions that are transferred for coordinated pre-trial proceedings
with MDL 1720.
The Company continues to defend the claims in this action
vigorously and its entry into the Agreements in no way serves as
an admission as to the validity of the allegations in the
complaints. Similarly, the Agreements have had no impact on the
Company's ability to quantify the potential impact from this
action, if any, and the Company is unable to do so at this time.
HSBC FINANCE: Awaits Claims Admin. Completion in "Jaffe" Suit
-------------------------------------------------------------
HSBC Finance Corporation is awaiting completion of the claims
administration process in the lawsuit captioned Jaffe v. Household
International, Inc., et al., according to the Company's August 1,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
As a result of an August 2002 restatement of previously reported
consolidated financial statements and other corporate events,
including the 2002 settlement with 46 states and the District of
Columbia relating to real estate lending practices, Household
International, the predecessor to HSBC Finance Corporation, and
certain former officers were named as defendants in a class action
lawsuit, Jaffe v. Household International, Inc., et al., No. 02 C
5893 (N.D. Ill., filed August 19, 2002). The complaint asserted
claims under Sections 10 and 20 of the Securities Exchange Act of
1934, on behalf of all persons who acquired and disposed of
Household International common stock between July 30, 1999 and
October 11, 2002. The claims alleged that the defendants
knowingly or recklessly made false and misleading statements of
material fact relating to Household's Consumer Lending operations,
including collections, sales and lending practices, some of which
ultimately led to the 2002 state settlement agreement, and facts
relating to accounting practices evidenced by the restatement. A
jury trial concluded on April 30, 2009, and the jury rendered a
verdict on May 7 partially in favor of the plaintiffs with respect
to Household International and three former officers. A second
phase of the case was to proceed to determine the actual damages,
if any, due to the plaintiff class and issues of reliance. On
November 22, 2010, the Court issued a ruling on the second phase
of the case. On the issue of reliance, the Court ruled that claim
forms would be mailed to class members and that class members who
file claims would be asked to check a "YES" or "NO" box to a
question that asks whether they would have purchased Household
stock had they known false and misleading statements inflated the
stock price. As for damages, the Court set out a method for
calculating damages for class members who file claims. As
previously reported, in Court filings in March 2010, plaintiff's
lawyers have estimated that damages could range 'somewhere between
$2.4 billion to $3.2 billion to class members', before pre-
judgment interest. The defendants filed a motion for
reconsideration from the Court's November 22 ruling. On
January 14, 2011, the Court partially granted that motion,
slightly modifying the claim form; allowing defendants to take
certain discovery on the issue of reliance and reserving on the
issue whether the defendants would ultimately be entitled to a
jury trial on the issues of reliance and damages. On January 31,
2011, and April 7, 2011, the Court issued other rulings clarifying
the scope of discovery. Plaintiffs mailed the claim forms with
the modified language to class members.
Class members had until May 24 to file claims. In filings with
the Court, plaintiffs indicated that the Court-appointed claims
administrator mailed claim forms for delivery to 646,715 potential
class members and received 77,436 claims by the May 24, 2011
deadline. Plaintiffs also indicated that the claims administrator
has determined preliminarily that 45,332 of the claimants have an
allowed loss, and that the "preliminary, estimated damages for
these potential class members, subject to revision as duplicate
claims are identified and supplemental information is received,
exceeds $2,000,000,000." All submitted claims are subject to a
validation process that, as indicated in the plaintiffs' filings,
will not be completed until December 2011. Once the claims
administration process is complete, plaintiffs are expected to ask
the Court to assess pre-judgment interest to be included as part
of the Court's final judgment.
The date on which the Court may enter a final judgment is not
known at this time and the timing and outcome of the ultimate
resolution of this matter is uncertain. When a final judgment is
entered by the District Court, the parties have 30 days in which
to appeal the verdict to the Seventh Circuit Court of Appeals.
The Company continues to believe that it has meritorious grounds
for appeal of one or more of the rulings in the case and intends
to appeal the Court's final judgment, which could involve a
substantial amount. Upon appeal, the Company will be required to
secure the judgment in order to suspend execution of the judgment
while the appeal is ongoing by depositing cash in an interest-
bearing escrow account or posting an appeal bond in the amount of
the judgment (including any pre-judgment interest awarded). Given
the complexity and uncertainties associated with the actual
determination of damages, including the outcome of any appeals,
there is a wide range of possible damages. The Company believes
it has meritorious grounds for appeal on matters of both liability
and damages, and will argue on appeal that damages should be zero
or a relatively insignificant amount. If the Appeals Court
partially accepts or rejects the Company's arguments, the cost of
damages, including pre-judgment interest, could be higher, and may
lie in a range from a relatively insignificant amount to somewhere
in the region of $3.0 billion.
HSBC FINANCE: Parties in Debt Cancellation Suits Working on Deal
----------------------------------------------------------------
Parties in six of the eight class action lawsuits relating to HSBC
Finance Corporation's debt cancellation or suspension products are
currently in the process of memorializing the terms of a
settlement agreement, according to the Company's August 1, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended June 30, 2011.
Between July 2010 and May 2011, eight substantially similar
putative class actions were filed against the Company's
subsidiaries, HSBC Bank Nevada, N.A. ("HSBC Bank Nevada") and HSBC
Card Services Inc.: Rizera et al. v. HSBC Bank Nevada et al.
(D.N.J. 10-CV-03375); Esslinger et al v. HSBC Bank Nevada, N.A. et
al. (E.D. Pa. 10-CV-03213); McAlister et al. v. HSBC Bank Nevada,
N.A. et al. (W.D. Wash. 10-CV-05831); Mitchell v. HSBC Bank
Nevada, N.A. et al. (D. Md. 10-CV-03232); Samuels v. HSBC Bank
Nevada, N.A. et al. (N.D. III. 11-CV-00548); McKinney v. HSBC Card
Services et al. (S.D. III. 10-CV-00786); Chastain v. HSBC Bank
Nevada, N.A. (South Carolina Court of Common Pleas, 13th Circuit)
(filed as a counterclaim to a pending collections action); Colton
et al. v. HSBC Bank Nevada, N.A. et al. (C.D. Ca. 11-CV-03742).
These actions principally allege that cardholders were enrolled in
debt cancellation or suspension products and challenge various
marketing or administrative practices relating to those products.
The plaintiffs' claims include breach of contract and the implied
covenant of good faith and fair dealing, unconscionability, unjust
enrichment, and violations of state consumer protection and
deceptive acts and practices statutes. The Mitchell action was
dismissed by the plaintiff in March 2011. In July 2011, the
parties in Rizera, Esslinger, McAlister, Samuels, McKinney and
Colton executed a memorandum of settlement and filed notices of
settlement of all claims in each respective court. The parties
are currently in the process of memorializing the terms and
conditions of settlement in a formal agreement, which will be
submitted to one court on a consolidated basis for approval. The
Company says it is adequately reserved for the proposed
settlement.
HSBC USA: Awaits Ruling on Motion to Dismiss "Levin" Suit
---------------------------------------------------------
HSBC USA Inc. is awaiting a ruling on its motion to dismiss a
putative class action lawsuit filed against its subsidiary,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In February 2011, an action captioned Ofra Levin et al. v. HSBC
Bank USA, N.A. et al. (E.D.N.Y. 11-CV-0701) was filed in the
Eastern District of New York against HSBC Bank USA, HSBC USA and
HSBC North America on behalf of a putative nationwide class and
New York sub-class of customers who allegedly incurred overdraft
fees due to the posting of debit card transactions to deposit
accounts in high-to-low order. Levin asserts claims for breach of
contract and the implied covenant of good faith and fair dealing,
conversion, unjust enrichment, and violation of the New York
deceptive acts and practices statute. The plaintiffs dismissed
the Federal court action after the case was transferred to the
multi-district litigation pending in Miami, Florida, and re-filed
the case in New York state court on March 1, 2011. The action,
captioned Ofra Levin et al. v. HSBC Bank USA et al. (N.Y. Sup. Ct.
650562/11), alleges a variety of common law claims and violations
on behalf of a New York class, including breach of contract and
implied covenant of good faith and fair dealing, conversion,
unjust enrichment and a violation of the New York deceptive acts
and practices statute. The Company filed a motion to dismiss the
complaint on May 2, 2011. At this time the Company is unable to
reasonably estimate the liability, if any, that might arise as a
result of this action and will defend the claims vigorously.
HSBC USA: Continues to Defend Madoff-Related Suits
--------------------------------------------------
HSBC USA Inc. continues to defend lawsuits relating to the alleged
Ponzi scheme ran by Bernard L. Madoff, according to the Company's
August 1, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
In December 2008, Bernard L. Madoff was arrested for running a
Ponzi scheme and a trustee was appointed for the liquidation of
his firm, Bernard L. Madoff Investment Securities LLC ("Madoff
Securities"), a SEC-registered broker-dealer and investment
adviser. Various non-U.S. HSBC companies provided custodial,
administration and similar services to a number of funds
incorporated outside the United States whose assets were invested
with Madoff Securities. Plaintiffs (including funds, funds
investors and the Madoff Securities trustee) have commenced
Madoff-related proceedings against numerous defendants in a
multitude of jurisdictions. Various HSBC companies have been
named as defendants in lawsuits in the United States, Ireland,
Luxembourg and other jurisdictions. The lawsuits (which include
U.S. class actions) allege that the HSBC defendants knew or should
have known of Madoff's fraud and breached various duties to the
funds and fund investors.
The Company says these actions are at an early stage. There are
many factors that may affect the range of possible outcomes, and
the resulting financial impact, of the various Madoff-related
proceedings including, but not limited to, the circumstances of
the fraud, the multiple jurisdictions in which proceeding have
been brought and the number of different plaintiffs and defendants
in such proceedings. For these reasons, among others, the Company
says it is unable to reasonably estimate the aggregate liability
or ranges of liability that might arise as a result of these
claims but it could be significant. In any event, the Company
considers that it has good defenses to these claims and will
continue to defend them vigorously.
HUGOTON ROYALTY: XTO Continues to Defend "Fankhouser" Suit
----------------------------------------------------------
XTO Energy Inc. continues to defend itself from a class action
lawsuit filed by Fankhouser and Goddard, according to Hugoton
Royalty Trust's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
An amended petition for a class action lawsuit, Beer, et al. v.
XTO Energy Inc., was filed in January 2006 in the District Court
of Texas County, Oklahoma, by certain royalty owners of natural
gas wells in Oklahoma and Kansas. The plaintiffs allege that XTO
Energy has not properly accounted to the plaintiffs for the
royalties to which they are entitled and seek an accounting
regarding the natural gas and other products produced from their
wells and the prices paid for the natural gas and other products
produced, and for payment of the monies allegedly owed since June
2002, with a certain limited number of plaintiffs claiming monies
owed for additional time. XTO Energy removed the case to federal
district court in Oklahoma City. In April 2010, new counsel and
representative parties, Fankhouser and Goddard, filed a motion to
intervene and prosecute the Beer class, now styled Fankhouser v.
XTO Energy Inc. This motion was granted on July 13, 2010. The
new plaintiffs and counsel filed an amended complaint asserting
new causes of action for breach of fiduciary duties and unjust
enrichment. On December 16, 2010, the court certified the class.
XTO Energy has informed the trustee that it believes that it has
strong defenses to this lawsuit and intends to vigorously defend
its position.
No further updates were reported in the Company's latest SEC
filing.
Hugoton Royalty Trust is an express trust created under the laws
of Texas pursuant to the Hugoton Royalty Trust Indenture entered
into on Dec. 1, 1998 between XTO Energy Inc., as grantor, and
NationsBank, N.A., as trustee.
HUGOTON ROYALTY: XTO Still Defends "Roderick" Suit in Kansas
------------------------------------------------------------
XTO Energy Inc. continues to defend a class action lawsuit
commenced by Wallace B. Roderick Revocable Living Trust, according
to Hugoton Royalty Trust's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In September 2008, a class action lawsuit was filed against XTO
Energy Inc. styled Wallace B. Roderick Revocable Living Trust, et
al. v. XTO Energy Inc. in the District Court of Kearny County,
Kansas. XTO Energy removed the case to federal court in Wichita,
Kansas. The plaintiffs allege that XTO Energy has improperly
taken post-production costs from royalties paid to the plaintiffs
from wells located in Kansas, Oklahoma and Colorado. The
plaintiffs have filed a motion to certify the class, including
only Kansas and Oklahoma wells not part of that certain Fankhouser
matter also filed against XTO Energy. After filing the motion to
certify, but prior to the class certification hearing, Plaintiff
filed a motion to sever the Oklahoma portion of the case so it
could be transferred and consolidated with a newly filed class
action in Oklahoma styled Chieftain v. XTO Energy Inc. This
motion was granted. The Roderick case now comprises only Kansas
wells not previously included in the Fankhouser matter. XTO
Energy has informed the trustee that it believes that XTO Energy
has strong defenses to this lawsuit and intends to vigorously
defend its position.
In December 2010, a class action lawsuit was filed against XTO
Energy styled Chieftain Royalty Company vs. XTO Energy Inc. in
Coal County District Court, Oklahoma. XTO Energy removed the case
to federal court in the Eastern District of Oklahoma. The
Plaintiffs allege that XTO wrongfully deducted fees from royalty
payments on Oklahoma wells, failed to make diligent efforts to
secure the best terms available for the sale of gas and its
constituents, and demand an accounting to determine whether they
have been fully and fairly paid gas royalty interests. The case
expressly excludes those claims and wells being prosecuted in the
Fankhouser matter. The severed Roderick case claims will likely
be consolidated into Chieftain. XTO Energy has informed the
trustee that it believes that XTO Energy has strong defenses to
this lawsuit and intends to vigorously defend its position.
No further updates were reported in the Company's latest SEC
filing.
Hugoton Royalty Trust is an express trust created under the laws
of Texas pursuant to the Hugoton Royalty Trust Indenture entered
into on Dec. 1, 1998 between XTO Energy Inc., as grantor, and
NationsBank, N.A., as trustee.
HUMANA INC: Unit Continues to Defend "Sacred Heart" Suit
--------------------------------------------------------
A Humana Inc. subsidiary continues to defend itself against a
class action lawsuit commenced by Sacred Heart Health System,
Inc., according to the Company's August 1, 2011, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2011.
The Company's subsidiary, Humana Military Healthcare Services,
Inc. ("Humana Military") was named as a defendant in Sacred Heart
Health System, Inc., et al. v. Humana Military Healthcare Services
Inc., Case No. 3:07-cv-00062 MCR/EMT (the "Sacred Heart"
Complaint), a purported class action lawsuit filed on February 5,
2007, in the U.S. District Court for the Northern District of
Florida asserting contract and fraud claims against Humana
Military. The Sacred Heart Complaint alleged, among other things,
that, Humana Military breached its network agreements with a class
of hospitals in six states, including the seven named plaintiffs,
that contracted for reimbursement of outpatient services provided
to beneficiaries of the DoD's TRICARE health benefits program
("TRICARE"). The Complaint alleged that Humana Military breached
its network agreements when it failed to reimburse the hospitals
based on negotiated discounts for non-surgical outpatient services
performed on or after October 1, 1999, and instead reimbursed them
based on published CHAMPUS Maximum Allowable Charges (so-called
"CMAC rates"). Humana Military denied that it breached the
network agreements with the hospitals and asserted a number of
defenses to these claims. The Complaint sought, among other
things, the following relief for the purported class members: (i)
damages as a result of the alleged breach of contract by Humana
Military, (ii) taxable costs of the litigation, (iii) attorneys
fees, and (iv) any other relief the court deems just and proper.
Separate and apart from the class relief, named plaintiff Sacred
Heart Health System Inc. requested damages and other relief for
its individual claim against Humana Military for fraud in the
inducement to contract.
On September 25, 2008, the district court certified a class
consisting of all institutional healthcare service providers in
TRICARE former Regions 3 and 4 which had network agreements with
Humana Military to provide outpatient non-surgical services to
CHAMPUS/TRICARE beneficiaries as of November 18, 1999, excluding
those network providers who contractually agreed with Humana
Military to submit any such disputes with Humana Military to
arbitration. On March 3, 2010, the Court of Appeals reversed the
district court's class certification order and remanded the case
to the district court for further proceeding. On June 28, 2010,
the plaintiffs sought leave of the district court to amend their
complaint to join additional hospital plaintiffs. Humana Military
filed its response to the motion on July 28, 2010. The district
court granted the plaintiffs' motion to join 33 additional
hospitals on September 24, 2010. On October 27, 2010, the
plaintiffs filed their Fourth Amended Complaint claiming the U.S.
District Court for the Northern District of Florida has subject
matter jurisdiction over the case because the allegations in the
complaint raise a substantial question under federal law. The
amended complaint asserts no other material changes to the
allegations or relief sought by the plaintiffs. Humana Military's
Answer to the Fourth Amended Complaint was filed on November 30,
2010.
No further updates were reported in the Company's latest SEC
filing.
Humana says it intends to defend the action vigorously.
HUMANA INC: Wants to Eliminate Independent Pharmacies, Suit Says
----------------------------------------------------------------
Marimer Matos at Courthouse News Service reports that Humana is
waging "an unlawful crusade to eliminate as many independent
pharmacies from its network as possible" by terminating its
provider agreements without cause, a pharmacy claims in a class
action.
Intramed sued Humana on behalf of thousands of independent
pharmacies nationwide, in Broward County Court.
Humana, a Fortune 100 company, sells and administers health
insurance policies nationwide.
Intramed claims Humana violates federal regulations requiring that
any insurance company participating in a Medicare Part D program,
of which Humana is a member, must work with any pharmacy that
meets Part D plan's standards and conditions.
"Although Intramed has complied with all of Humana's audit
requirements, contract requirements, etc., Humana nevertheless
abruptly terminated Intramed twice 'without cause.'
Interestingly, during the last few years, Intramed is not the only
local independent Florida pharmacy (in contrast to the large chain
pharmacies) to have been terminated 'without cause.' Apparently,
Humana is engaged in an unlawful crusade to eliminate as many
independent pharmacies from its network as possible," the
complaint states.
Intramed claims that after providing low-cost prescriptions to
Humana's mostly elderly members for 8 years and satisfying all of
the contract requirements, Humana terminated their agreement
without cause in February 2010.
A few weeks later, Humana claimed that the contract was void
because Intramed had been "operating like a mail order pharmacy,"
which violated their agreement, according to the complaint.
But Intramed says the pretext of that excuse became apparent
before the termination date of May 2010, when, "having apparently
abandoned its first 'without cause' termination, Humana offered
Intramed the opportunity to join its mail order pharmacy network."
A year later, Humana terminated its agreement again without cause,
this time without 90-day notice, Intramed says. And this time,
Intramed says, Humana asked it again to be a part of its mail-
order pharmacy, but under more "onerous" terms.
Intramed seeks an injunction and damages for breach of contract,
deceptive trade, and tortious interference.
A copy of the Complaint in Intramed, Inc. v. Humana Inc., Case No.
11-17064 (Fla. Cir. Ct., Broward Cty.), is available at:
http://www.courthousenews.com/2011/08/03/Humana.pdf
The Plaintiff is represented by:
Kevin B. Love, Esq.
CRIDEN & LOVE, P.A.
7301 S.W. 57th Court, Suite 515
South Miami, FL 33143
Telephone: (305) 357-9000
E-mail: klove@cridenlove.com
HURONIA REGIONAL CENTRE: Ontario Gov't. Hinders Class Actions
-------------------------------------------------------------
The Canadian Press reports that a lawyer representing former
residents of two provincially run institutions for developmentally
disabled people says the Ontario government is unnecessarily
preventing the approval of two class action cases.
David Rosenfeld is trying to have the lawsuits approved on behalf
of former residents of the Rideau Centre in Smiths Falls and the
Southwestern Centre outside of Chatham.
He says the province is delaying the inevitable because the cases
are so similar to another one that has already been approved as a
class action.
A C$1-billion suit alleges mental and physical abuse as well as
the administration of unnecessary medication took place at the
Huronia Regional Centre in Orillia, Ont., from 1945 until it
closed in 2009.
The suit was approved as a class action in July 2010 but none of
the allegations have been proven in court.
Attorney general office spokesman Brendan Crawley says the
province has met all its deadlines for the cases.
ITRON INC: Still Faces Securities Class Suit in Washington
----------------------------------------------------------
Itron Inc. is still facing a class action lawsuit in Washington
alleging violation of securities laws relating to a restatement of
its financial results, according to the Company's August 2, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarterly period ended June 30, 2011.
On February 23, 2011, a class action lawsuit was filed in U.S.
Federal Court for the Eastern District of Washington alleging a
violation of federal securities laws relating to a restatement of
the Company's financial results for the quarters ended March 31,
June 30, and September 30, 2010. These revisions were made
primarily to defer revenue that had been incorrectly recognized on
one contract due to a misinterpretation of an extended warranty
obligation. The effect was to reduce revenue and earnings in each
of the first three quarters of the year. For the first nine
months of 2010, total revenue was reduced by $6.1 million and
diluted EPS was reduced by 11 cents. The Company believes the
facts and legal claims alleged are without merit and intends to
vigorously defend its interests.
No updates were reported in the Company's latest SEC filing.
JIANGBO PHARMA: Milberg LLP Files Securities Class Action
---------------------------------------------------------
Milberg LLP disclosed that on August 2, 2011, the firm filed a
class action lawsuit on behalf of investors who purchased the
securities of Jiangbo Pharmaceuticals, Inc. during the period
June 8, 2010, to May 31, 2011, inclusive. The case, Lewis v.
Jiangbo Pharmaceuticals, Inc., No. 1:11-cv-22788-PAS, is pending
in the United States District Court for the Southern District of
Florida and alleges violations of the Securities Exchange Act of
1934 by Jiangbo and certain of the Company's officers.
Jiangbo researches and develops pharmaceutical products in China.
Jiangbo produces both western and Chinese herbal-based medical
drugs in tablet, capsule, granule, syrup, and electuary form.
The Complaint alleges that throughout the Class Period, Defendants
made materially false and misleading statements to investors by
materially overstating the Company's cash balances and failing to
disclose that Jiangbo's internal controls over financial reporting
were inadequate.
In March 2011, the Company's Chief Financial Officer resigned. On
April 4, 2011, the Company reported that it had replaced its
auditor. On May 27, 2011, the Company disclosed that the
Securities and Exchange Commission had, in December 2010,
commenced an informal investigation. On May 31, 2011, NASDAQ
halted trading of Jiangbo stock. The Company received a delisting
letter from NASDAQ on July 26, 2011.
If you purchased securities of Jiangbo from June 8, 2010, to
May 31, 2011, you may move the court no later than September 14,
2011, and request that the Court appoint you as lead plaintiff. A
lead plaintiff is a class member that acts on behalf of other
class members in directing the litigation. Your share in any
recovery will not be enhanced or diminished by serving as a lead
plaintiff, however, lead plaintiffs make important decisions that
could affect the overall recovery for class members. You do not
need to be a lead plaintiff to recover in a class action; you can
recover as an absent class member. You may retain Milberg LLP, or
other attorneys, for this action, but do not need to retain
counsel to recover as an absent class member. If this action is
certified as a class action, class members will be automatically
represented by court-appointed counsel. The lawsuits discussed
here were not filed by Milberg.
Milberg LLP -- http://www.milberg.com-- represents individual and
institutional investors and serves as lead counsel in federal and
state courts throughout the United States. If you wish to discuss
this matter with us, or have any questions regarding this matter,
please contact the following attorneys:
Andrei Rado, Esq.
Jessica Sleater, Esq.
Milberg LLP
One Pennsylvania Plaza
49th Floor
New York, NY 10119-0165
Telephone: (800) 320-5081
E-mail: arado@milberg.com
jsleater@milberg.com
JOHN DEMARCO: Ex-Workers File Class Action Over Unpaid Overtime
---------------------------------------------------------------
Kate Wilcox, writing for Reading Eagle, reports that two former
employees of John DeMarco Landscaping in Amity Township have filed
a class action lawsuit against the company, accusing it of failing
to properly pay workers more than $7,000 in overtime.
The complaint was filed on July 29 in Berks County Court by Benito
Contreras and Martin Cruz, both of Berks County.
They are represented by the Community Justice Project of
Pennsylvania, a nonprofit public interest law firm that has a
Hispanic Outreach Office in Reading.
The complaint also lists as plaintiffs 60 to 100 hourly employees
who have been with the company for the past three years.
In the complaint, Messrs. Contreras and Cruz said DeMarco paid
employees in cash for some regular hours worked and paid all
overtime hours at the regular hourly rate of $10, not at the time-
and-a-half rate.
The complaint alleges the company violated the Pennsylvania
Minimum Wage Act and the Fair Labor Standards Act.
John DeMarco, company owner, said the lawsuit is a
misunderstanding.
"Benito worked for two separate companies," he said.
Mr. DeMarco declined to answer if he owned both companies.
Laurence E. Norton II, an attorney with the Community Justice
Project, said such situations are common.
"It's an opportunity to make it clear that the obligation to pay
fair overtime and wages is not dependent on legal status," he
said.
This is the second class-action lawsuit against a landscaper in
the Reading area in the past few years. The Community Justice
Project represented other workers who won a settlement against
Sal's Landscape and Tree Service in Lower Heidelberg Township.
That case also involved overtime pay.
"There are various ways that employers seek to make more money and
save money by cheating employees," Mr. Norton said. "But the law
is very clear: The business owner is responsible. We tend to be
very successful with these cases."
According to the complaint against Mr. DeMarco, Mr. Contreras
worked at the landscaping company from spring 2008 to June;
Mr. Cruz worked there from spring 2008 to summer 2010.
The plaintiffs are requesting Mr. DeMarco pay all unpaid overtime
wages and attorney's fees for themselves and the other workers
affected during the past three years.
Mr. Norton estimated that Mr. Contreras is owed more than $3,500,
which would be doubled under the Fair Labor Standards Act. The
other class members could be owed more or less, depending on hours
worked and duration of their employment, he said.
The complaint also requests the company report the wages it didn't
pay to the Social Security Administration and pay its share of
taxes on the wages.
"I think that they think that the workers are not going to
complain and that the workers are just happy to get work,"
Mr. Norton said.
He said that because many of the workers are Latino, some
employers believe a fear of deportation makes employees less
likely to report any problems.
Mr. Norton said that in addition to recovering money for the
workers, the nonprofit hopes to discourage employers from
underpaying workers.
KINETIC CONCEPTS: Being Sold to Apax for Too Little, Suit Claims
----------------------------------------------------------------
Courthouse News Service reports that shareholders say Kinetic
Concepts, a maker of medical products, is selling itself too
cheaply through an unfair process to Apax Partners, for $68.50 a
share or $6.3 billion.
A copy of the Complaint in Ross v. Kinetic Concepts, Inc., et al.,
Case No. 2011-CI-12497 (Tex. Dist. Ct., Bexar Cty.), is available
at:
http://www.courthousenews.com/2011/08/03/SCA.pdf
The Plaintiff is represented by:
James A. Hall, Esq.
Sonia M. Rodriguez, Esq.
BRANTON HALL RODRIGUEZ CRUZ P.C.
8100 Broadway
San Antonio, TX 78209
Telephone: (210) 224-4474
- and -
Lee D. Rudy, Esq.
Michael C. Wagner, Esq.
John Quinn Kerrigan, Esq.
KESSLER TOPAZ MELTZER & CHECK, LLP
280 King of Prussia Road
Radnor, PA 19087
Telephone: (610) 667-7706
E-mail: lrudy@ktmc.com
mwagner@ktmc.com
Qkerrigan@ktmc.com
- and -
Hamilton Lindley, Esq.
GOLDFARB BRANHAM LLP
Saint Ann Court
2501 N. Harwood St., Suite 1801
Dallas, TX 75201
Telephone: (214) 583-2233
E-mail: hlindley@goldfarbbranham.com
KISSMETRICS: Faces Class Action Over Web Tracking Technology
------------------------------------------------------------
Ryan Singel, writing for Wired.com, reports that Web site
analytics firm KISSmetrics and more than 20 of its customers,
including Spotify, AOL's About.me, Slideshare.net, Spokeo and the
news site Gigaom.com were sued on Aug. 1 on the grounds that
KISSmetrics' tracking technology violated federal and state
privacy laws.
The suit, filed in a federal court in Northern California, is
seeking class-action status and unspecified damages.
At issue are methods KISSmetrics used -- first reported by
Wired.com -- to track users who have deleted their cookies. The
company juggled a variety of other technologies including Flash,
Silverlight, HTML5 and so-called ETags in cached browser files to
place and read unique identifiers.
The suit was filed by a group of lawyers, including Scott Kamber,
who already filed suit against Hulu and KISSmetrics on July 29,
the same day a U.C. Berkeley report said those companies were re-
creating cookies after users deleted them.
Sometime over the weekend, KISSmetrics published a longer privacy
policy, and changed the "How It Works" page on its Web site to
reveal that the company would stop using ETags. "As of July 30,
2011 KISSmetrics uses standard first-party cookies to generate a
random identity assigned to visitors to our customers sites," the
new text promises. "This identity by itself does nothing." The
company added in a separate privacy policy for end-users that
users can now set an opt-out cookie that excludes them from
tracking entirely -- as one can do with many online advertising
companies and some analytics companies.
KISSmetrics founder Hiten Shah told Wired.com that KISSmetrics was
very respectful of privacy and that it's hardly the only site on
the net to use ETags as cookie replacements.
"KISSmetrics has never shared any information about a user with
any third party, including with any customer other than the one
that interacted with that user," Mr. Shah said via e-mail. "Our
business model is uniquely pro-privacy precisely because our tools
enable insights without sharing any user information across
Web sites and without developing or storing user profiles across
sites, and that for this reason, KISSmetrics offers key
differences from third parties that link up user data across the
Internet."
But the lawsuit has a different take.
"Defendants circumvented Plaintiffs and Class Members browser
privacy controls, conducted tracking in unreasonable and
unexpected way, and used Plaintiffs and Class Members' Computer
Assets to store LSOs [Local Storage Objects, or cookie-like files
in Flash] and engage in other tracking exploits . . . .", the suit
alleged. "Defendants did so knowing Plaintiffs and Class Members'
reasonably believed their privacy was protected."
A similar set of suits were filed in 2009, after U.C. Berkeley
researchers uncovered "zombie cookies" being used on some of the
net's top sites, including Hulu, thanks to technology from
Quantcast and Clearspring. Those suits were settled for $2.4
million and a promise from the two providers never to use that
technology again.
Those companies' clients were largely spared in the settlement and
agreed only to disclose in their privacy policy if they were using
Adobe Flash's storage capability. They also agreed to provide a
link in the policy for users who wanted to block that storage.
When asked about the suit, Spotify told Wired.com that it used
KISSmetrics to "help us understand customer registration and
purchase flow, and to make the process of using our Web site as
easy as possible for users," and that it takes privacy seriously.
"Following the recent report raising concerns around KISSmetrics'
treatment of cookies, we took immediate action to suspend our use
of KISSmetrics and began a thorough investigation," spokeswoman
Alison Bonny said. "Spotify can confirm that it has never had the
ability to see or use any customer information from KISSmetrics'
other clients. Kissmetrics has assured us that none of its other
clients have had the ability to see or use information about
Spotify's customers."
GigaOm CEO Paul Walborsky responded in a blog post, calling the
allegations are based on "misinformation" but added that the
company "suspended the use of it on our site while we investigate
the claims."
The other companies named in the suit are BabyPips, Moo.com,
RavenTools, Shoedazzle, 8tracks.com, Hasoffers.com,
Kongregate.com, Livemocha.com, Rockettheme, RunKeeper, SEOMoz,
Sharecash.org, visual.ly, Condueit (wibiya.com), and Flite
(widgetbox.com).
LANDSTAR SYSTEM: Appeal From Denial of OOIDA Rehearing Pending
--------------------------------------------------------------
A petition to appeal certain portions of a ruling denying a
request for a rehearing in the class-action lawsuit, Owner-
Operator Independent Drivers Association Inc. et al. v. Landstar
System Inc., et al., remains pending with the United States
Supreme Court, according to the Company's July 29, 2011 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 25, 2011.
The Company and certain of its subsidiaries are defendants in a
suit brought in the United States District Court for the Middle
District of Florida by the Owner-Operator Independent Drivers
Association, Inc., and four former BCO Independent Contractors on
behalf of all independent contractors who provide truck capacity
to the Company and its subsidiaries under exclusive lease
arrangements. The Plaintiffs allege that certain aspects of the
Company's motor carrier leases and related practices with its BCO
Independent Contractors violate certain federal leasing
regulations and seek injunctive relief, an unspecified amount of
damages and attorneys' fees.
On March 29, 2007, the District Court denied the request by
Plaintiffs for injunctive relief, entered a judgment in favor of
the Defendants and issued written orders setting forth its rulings
related to the decertification of the plaintiff class and other
important elements of the Litigation relating to liability,
injunctive relief and monetary relief. The Plaintiffs filed an
appeal with the United States Court of Appeals for the Eleventh
Circuit of certain of the District Court's rulings in favor of the
Defendants. The Defendants asked the Appellate Court to affirm
such rulings and filed a cross-appeal with the Appellate Court
with respect to certain other rulings of the District Court. On
September 3, 2008, the Appellate Court issued its initial ruling.
Each of the parties to the Litigation subsequently filed a
petition with the Appellate Court seeking rehearing of the
Appellate Court's ruling.
On October 4, 2010, the Appellate Court denied each of the motions
for rehearing, withdrew its initial ruling and substituted a new
ruling in its place. The new ruling by the Appellate Court
confirmed the absence of any violations alleged by the Plaintiffs
of the federal leasing regulations with respect to the written
terms of all leases currently in use between the Defendants and
BCO Independent Contractors. In particular, the new ruling, among
other things, held that (i) the Defendants are not prohibited by
the applicable federal leasing regulations from charging
administrative or other fees to BCO Independent Contractors in
connection with voluntary programs offered by the Defendants
through which a BCO Independent Contractor may purchase discounted
products and services for a charge that is deducted against the
compensation payable to the BCO Independent Contractor, (ii) in
the case of a Charge-back Deduction expressed as a flat-fee in the
lease, the applicable federal leasing regulations do not require
Defendants to do more than disclose the flat-fee Charge-back
Deduction in the lease and follow up with settlement statements
that explain the final amount charged back, (iii) the Plaintiffs
are not entitled to restitution or disgorgement with respect to
violations by Defendants of the applicable federal leasing
regulations but instead may recover only actual damages, if any,
which they sustained as a result of any such violations and (iv)
the claims of BCO Independent Contractors may not be handled on a
class action basis for purposes of determining the amount of
actual damages, if any, they sustained as a result of any
violations.
However, the new ruling of the Appellate Court reversed the
District Court's ruling that an old version of the lease formerly
used by Defendants but not in use with any current BCO Independent
Contractor complied with applicable disclosure requirements under
the federal leasing regulations with respect to adjustments to
compensation payable to BCO Independent Contractors on certain
loads sourced from the U. S. Department of Defense. The Appellate
Court then remanded the case to the District Court to permit the
Plaintiffs to seek injunctive relief with respect to this
violation of the federal leasing regulations and to hold an
evidentiary hearing to give the Named Plaintiffs an opportunity to
produce evidence of any damages they actually sustained as a
result of such violation.
On March 8, 2011, the Plaintiffs filed a petition with the United
States Supreme Court to seek to further appeal certain portions of
the Appellate Court's October 4, 2010 ruling. On March 23, 2011,
the Plaintiffs requested that the United States Supreme Court
consolidate such petition with a petition OOIDA subsequently filed
to seek to further appeal a decision of the United States Court of
Appeals for the Ninth Circuit on January 20, 2011, in a case not
otherwise involving the Company, Owner-Operator Indep. Drivers
Ass'n, Inc., et al v. Swift Transp. Co., Inc.
Although no assurances can be given with respect to the outcome of
the Litigation, including the March 8, 2011, petition to the
United States Supreme Court and any possible award of attorneys'
fees to the Plaintiffs, the Company believes that (i) no Plaintiff
has sustained any actual damages as a result of any violations by
the Defendants of the federal leasing regulations and (ii)
injunctive relief, if any, that may be granted by the District
Court on remand is unlikely to have a material adverse financial
effect on the Company.
LIVE NATION: Files Suit Against Insurer Over Class Actions
----------------------------------------------------------
Alfred Branch Jr., writing for TicketNews, reports that for the
second time in nine months, Live Nation has sued one of its
insurance companies for denying coverage to the live entertainment
and ticketing giant in class action lawsuits against it.
In the most recent lawsuit, Live Nation is suing underwriters at
Lloyd's London, and one of its subsidiaries Beazley Furlonge Inc.,
for $10 million for allegedly denying coverage to the company
against several class actions Live Nation fought as part of the
debacle over its Ticketmaster division redirecting customers to
the secondary ticket Web site TicketsNow it also owns. The $10
million lawsuit was filed last month in Los Angeles Superior Court
in California.
Live Nation has an insurance policy with Beazley Furlonge that it
claims covers it against certain damages, such as its professional
or technology services and content, according to Westlaw Journals,
which first reported on the lawsuit.
The company believes that the policy should cover the related
TicketsNow lawsuits, in part because they involved the company's
Web sites.
Roughly a dozen separate but similar lawsuits concerning the
redirecting of customers were filed in the U.S. and Canada over
the last couple of years, and those suits were eventually
consolidated into one class action. Most of the trouble occurred
in 2009 after Bruce Springsteen fans were redirected from
Ticketmaster.com to TicketsNow.com where tickets are resold at a
premium above face value. Fans angrily claimed that they did not
realize they were being pushed to the secondary Web site, which
prompted Ticketmaster to apologize for the practice and settle
complaints with the former attorney general of New Jersey and the
Federal Trade Commission.
Ticketmaster claims that by denying it coverage, Lloyd's breached
the policy in several ways, including not adequately investigating
Ticketmaster's claims and forcing the company to incur financial
costs. Lloyd's eventually agreed to help defend the lawsuits but
only said it may be liable for one of the Canadian cases.
Ticketmaster's attorney David Schack, a partner in the Los Angeles
law firm K&L Gates, did not immediately return a message seeking
comment.
Late last year, Live Nation filed a similar lawsuit against
insurer Illinois Union Insurance Co. for failure to honor a policy
claim, this time involving a class action over delivery and other
fees the company charges for tickets.
M/I HOMES: Still Defending Class Suit on "Chinese Drywall" Claims
-----------------------------------------------------------------
M/I Homes, Inc., is still defending itself against remaining
claims related to the Company's use of defective drywall in
certain customers' homes, according to the Company's August 2,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
On March 5, 2009, a resident of Florida and an owner of one of the
Company's homes filed a complaint in the United States District
Court for the Southern District of Ohio, on behalf of himself and
other similarly situated owners and residents of homes in the
United States or alternatively in Florida, against the Company and
certain other identified and unidentified parties. The plaintiff
alleged that the Company built his home with defective drywall,
manufactured and supplied by certain of the defendants, that
contains sulfur or other organic compounds capable of harming the
health of individuals and damaging metals. The plaintiff alleged
physical and economic damages and sought legal and equitable
relief, medical monitoring and attorney's fees. The Company filed
a responsive pleading on or about April 30, 2009. This case was
consolidated with other similar actions not involving the Company
and transferred to the Eastern District of Louisiana pursuant to
an order from the United States Judicial Panel on Multidistrict
Litigation for coordinated pre-trial proceedings. In connection
with the administration of the In Re: Chinese Manufactured Drywall
Product Liability Litigation, the same homeowner and seven other
homeowners were named as plaintiffs in omnibus class action
complaints filed in and after December 2009 against certain
identified manufacturers of drywall and others (including the
Company), including one homeowner named as a plaintiff in an
omnibus class action complaint filed in March 2010 against various
unidentified manufacturers of drywall and others (including the
Company). As they relate to the Company, the Initial Action and
the MDL Omnibus Actions address substantially the same claims and
seek substantially the same relief. During the third quarter of
2010, the Company entered into agreements with three of those
homeowners named as plaintiffs pursuant to which the Company
agreed to make repairs to their homes consistent with repairs made
to the homes of other homeowners. As a result of those agreements,
the Initial Action has been resolved, and those three homeowners
are no longer parties to any of the MDL Omnibus Actions. The
Company intends to vigorously defend against the remaining claims.
No updates were reported in the Company's latest SEC filing.
METROPOLITAN HEALTH: Faces 6 Merger-Related Suits in Florida
------------------------------------------------------------
Metropolitan Health Networks, Inc., is facing six class action
lawsuits over its proposed merger with Continucare Corporation,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
On June 26, 2011, the Company entered into an Agreement and Plan
of Merger with Continucare Corporation and Cab Merger Sub, Inc., a
Florida corporation and a wholly owned subsidiary of Metropolitan
("Merger Subsidiary"), providing for the merger of Continucare
with Merger Subsidiary. Subject to the terms and conditions of
the Merger Agreement, Merger Subsidiary will be merged with and
into Continucare.
On July 1, 2011, a putative class action was filed in the Circuit
Court of the Eleventh Judicial Circuit in and for Miami-Dade
County, Florida, by Kathryn Karnell, Trustee and the Aaron and
Kathryn Karnell Revocable Trust U/A Dtd 4/9/09 against
Continucare, the members of the Continucare Board, individually,
Metropolitan, and Merger Sub (styled Kathryn Karnell Trustee, etc.
v. Continucare Corporation et al., No. 11-20538 CA40). Also on
July 1, 2011, a second putative class action was filed in the
Circuit Court of the Eleventh Judicial Circuit in and for Miami-
Dade County, Florida, by Steven L. Fuller against Continucare, the
members of the Continucare Board, individually, Metropolitan, and
Merger Sub (styled Steven L. Fuller v. Richard C. Pfenniger et
al., No. 11-20537 GA04). On July 6, 2011, a third putative class
action was filed in the Circuit Court of the Eleventh Judicial
Circuit in and for Miami-Dade County, Florida, by Hilary Kramer
against Continucare, the members of the Continucare Board,
individually, Metropolitan, and Merger Sub (styled Hilary Kramer
v. Richard C. Pfenniger Jr. et al., No. 11-20925 CA20). On
July 12, 2011, a fourth putative class action was filed in the
Circuit Court of the Eleventh Judicial Circuit in and for Miami-
Dade County, Florida, by Jamie Suprina against Continucare, the
members of the Continucare board of directors, individually,
Metropolitan, and Merger Sub (styled Jamie Suprina v. Continucare
Corporation et al., No. 11-21522 CA15). On July 22, 2011, a fifth
putative class action was filed in the Circuit Court of the
Eleventh Judicial Circuit in and for Miami-Dade County, Florida,
by Kojo Acquaah against Continucare, the members of the
Continucare board of directors, individually, Metropolitan, and
Merger Sub (styled Kojo Acquaah v. Continucare Corporation et al.,
No. 11-22833 CA40). Also on July 22, 2011, a sixth putative class
action was filed in the Circuit Court of the Eleventh Judicial
Circuit in and for Miami-Dade County, Florida, by David DeYoung
against Continucare, the members of the Continucare board of
directors, individually, Metropolitan, and Merger Sub (styled
David DeYoung v. Continucare Corporation et al., No. 11-22837
CA40). The plaintiffs in the Fuller, Karnell, and Acquaah and
DeYoung actions have filed motions seeking appointment of lead
counsel and to expedite discovery and the proceedings.
Each of these lawsuits alleges a claim against the members of the
Continucare Board for breach of fiduciary duty and a claim against
Continucare, Metropolitan, and Merger Sub for aiding and abetting
the individual defendants' alleged breach of fiduciary duty. The
amended complaints in Karnell, Suprina and Fuller and the
complaints in Acquaah and DeYoung also allege that the disclosure
contained in the Proxy Statement or Registration Statement on Form
S-4 originally filed by the Company on July 11, 2011, regarding
the pending Merger was inadequate. All of the lawsuits seek to
enjoin the pending transaction between Continucare and
Metropolitan, as well as attorneys' fees. The Acquaah and DeYoung
lawsuits also seek rescission. The Fuller, Kramer, and Suprina
lawsuits also seek rescission and money damages. Metropolitan
denies the allegations and intends to vigorously defend the
actions.
MORTON'S RESTAURANT: Deal to Settle Class Action in Calif. Pending
------------------------------------------------------------------
A subsidiary of Morton's Restaurant Group, Inc., entered in May
2011 into an agreement to settle a class action complaint filed by
former employees in California, according to the Company's August
2, 2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarterly period ended July 3, 2011.
In February 2010, two former employees of the San Diego Morton's
steakhouse filed a class action complaint against Morton's of
Chicago/San Diego, Inc. in the Superior Court of the State of
California for the County of San Diego, alleging certain
violations of the California Labor Code and the California Unfair
Competition Law for failure to provide meal and rest breaks,
failure to pay overtime and failure to provide employees with
accurate wage statements. The plaintiffs were seeking recovery of
statutory penalties, unpaid wages and overtime, as well as
injunctive and declaratory relief and attorneys' fees and costs.
On January 7, 2011, the Company's partial motion for summary
judgment was granted and the plaintiffs' claims for failure to
provide rest periods and failure to provide employees with
accurate wage statements were dismissed. In addition, on
February 18, 2011, the court denied plaintiffs' motion for class
certification. In May 2011, a settlement and release agreement was
entered into by the parties resolving this matter.
MORTON'S RESTAURANT: Jury Trial Scheduled for January 2012
----------------------------------------------------------
A jury trial in connection with a class action complaint filed by
a former employee against Morton's Restaurant Group, Inc.'s
subsidiary is scheduled for January 2012, according to the
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarterly period ended
July 3, 2011.
In August 2010, a former employee of the Costa Mesa Morton's
steakhouse filed a state-wide class action complaint against
Morton's of Chicago in the Superior Court of the State of
California for the County of Los Angeles, alleging certain
violations of the California Labor Code and the California Unfair
Competition Law for failure to provide meal and rest breaks,
failure to pay overtime and failure to provide employees with
accurate wage statements as a result of the classification of
California-based Assistant Managers and Day Managers as salaried
exempt. The plaintiff is seeking recovery of statutory penalties,
unpaid wages and overtime, as well as injunctive and declaratory
relief and attorneys' fees and costs. The Company is contesting
this matter vigorously. In September 2010, the Company removed
the case to Federal court and the plaintiff subsequently filed a
motion to remand. On January 26, 2011, the plaintiff's motion to
remand was denied. In addition, on June 13, 2011, the court
denied plaintiffs' motion for class certification. A jury trial
is scheduled for January 2012. The plaintiff in this matter has
not stated the amount of damages sought and, at this stage of the
proceedings, it is not possible to state the estimated damages
sought by the plaintiff.
NABORS INDUSTRIES: Final Hearing on "Denney" Deal Set for Sept. 8
-----------------------------------------------------------------
Final hearing for the approval of a settlement agreement in the
shareholder class action lawsuit against Nabors Industries Ltd.
and a subsidiary is scheduled for September 8, 2011, according to
the Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
In August 2010, Nabors and its wholly owned subsidiary, Diamond
Acquisition Corp. ("Diamond"), were sued in three putative
shareholder class actions. Two of the cases were dismissed. The
remaining case pending, Jordan Denney, Individually and on Behalf
of All Others Similarly Situated v. David E. Wallace, et al.,
Civil Action No. 10-1154, is pending in the United States District
Court for the Western District of Pennsylvania. The lawsuits were
brought against Superior, the individual members of its board of
directors, certain of Superior's senior officers, Nabors and
Diamond. The complaints alleged that Superior's officers and
directors violated various provisions of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and breached their
fiduciary duties in connection with the Superior acquisition, and
that Nabors and Diamond aided and abetted these violations. The
complaints sought injunctive relief, including an injunction
against the consummation of the Superior acquisition, monetary
damages, and attorneys fees and costs. The claim against Superior
and its directors is covered by insurance after a deductible
amount. The Company has entered into a settlement agreement
pursuant to which Superior's insurers will pay $475,000 in
attorney's fees in full settlement of this matter. The court has
preliminarily approved the settlement, with a final hearing
scheduled on September 8, 2011.
NEWS OF THE WORLD: Silverman Sherliker Mulls Class Action
---------------------------------------------------------
Caroline Butcher, writing for The Lawyer, reports that city law
firm Silverman Sherliker has doubled the number of ex-News of the
World (NoW) employees it is advising and says they have 'a very
strong case' for launching a stigma damage action against News
International (NI).
Managing partner Chris Sherliker launched an online action group
for sacked NoW staff on July 8 with a view to launching a class
action-style claim against NI. The claim would state that the
former employees' careers have been damaged by their association
with NI during the phone-hacking scandal (July 8, 2011).
The action group attracted about 20 expressions of interest within
its first 24 hours and Mr. Sherliker said the firm's number of NoW
clients was continuing to grow and included senior managers and
editors of the axed tabloid.
While employees are still in the midst of a 90-day consultation
period and awaiting compensation offers from NI, Mr. Sherliker
said several senior staff had already reported receiving cool
receptions from prospective employers because of their link to
what he termed the "tainted" newspaper.
"A lot of people are completely confused about their position and
there's a high degree of fear and apprehension among the more
senior people as to what's going to become of them," he said.
"It's been made clear to some of them by other employers they've
approached that there's no possibility they'll be offered
employment because of their involvement in NoW."
Mr. Sherliker said a group litigation could be launched as soon as
September, depending on what level of compensation and other pay-
offs are eventually offered by NI.
"It'll be the only way these people can get any money unless the
company decides to pay them off," he said.
Commenting on the likely timeframe for any court action, he added:
"I suspect we're talking about a number of months, but the making
of a group litigation order may expedite a number of other cases.?
Silverman Sherliker is due to meet with two sets of chambers
during August to instruct counsel and is also in negotiations with
costs funders in preparation for possibly launching the
litigation.
NEXTORCH INC: Recalls 16T Flashlight Batteries Due to Fire Hazard
-----------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
NexTorch, Inc., of Mukiteo, Washington, announced a voluntary
recall of about 16,000 NexTorch(TM) NT123A flashlight batteries.
Consumers should stop using recalled products immediately unless
otherwise instructed. It is illegal to resell or attempt to
resell a recalled consumer product.
Batteries can overheat and rupture, posing a fire and burn hazard
to consumers.
There has been one report of NexTorch NT123A flashlight batteries
rupturing and catching fire, causing burns to the consumer's body,
clothes and vehicle.
The recalled product is a NexTorch NT123A flashlight battery,
bearing the trademark (TM) superscript, rather than registered
trademark (R) superscript. Its body is silver metallic-colored
and has the NexTorch logo and the voltage (3 V) on it. The
battery is often packaged with NexTorch flashlights. Pictures of
the recalled products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml11/11296.html
The recalled products were manufactured in China and sold at
firearm dealers and law enforcement supply stores, and on the Web,
including amazon.com and the firm's Web site
http://www.nextorch.com/,from July 2007 to July 2011 for about $2
per battery.
Consumers should immediately stop use of the battery and contact
NexTorch for instructions on how to receive a free replacement.
For additional information, please call the firm toll-free at
(877) 867-2415 Monday through Friday between 9:00 a.m. and 5:00
p.m. Pacific Time, visit the firm's Web site at
http://www.nextorch.com/or e-mail the firm at usa@nextorch.com
NISOURCE INC: Suit Settlement Fund to Be Terminated Soon
--------------------------------------------------------
The West Virginia Circuit Court for Roane County in West Virginia
issued in June 2011 a second supplemental order to conclude
administration of a settlement in the lawsuit against a subsidiary
of NiSource Inc., according to the Company's August 2, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2011.
The Plaintiffs in Tawney, et al. v. Columbia Natural Resources,
Inc., Roane County, WV Circuit Court, who are West Virginia
landowners, filed a lawsuit in early 2003 in the West Virginia
Circuit Court for Roane County, West Virginia (the "Trial Court")
against the Company's subsidiary, Columbia Natural Resources, Inc.
("CNR") alleging that CNR underpaid royalties on gas produced on
their land by improperly deducting post-production costs and not
paying a fair value for the gas. Plaintiffs also claimed that
Defendants fraudulently concealed the deduction of post-production
charges. In December 2004, the Trial Court granted Plaintiffs'
motion to add NiSource and Columbia as Defendants. The Trial
Court later certified the case as a class action that includes any
person who, after July 31, 1990, received or is due royalties from
CNR (and its predecessors or successors) on lands lying within the
boundary of the state of West Virginia. Although NiSource sold
CNR in 2003, NiSource remained obligated to manage this litigation
and was responsible for the majority of any damages awarded to
Plaintiffs. On January 27, 2007, the jury hearing the case
returned a verdict against all Defendants in the amount of $404.3
million inclusive of both compensatory and punitive damages;
Defendants subsequently filed their Petition for Appeal, which was
later amended, with the West Virginia Supreme Court of Appeals
(the "Appeals Court"), which refused the petition on May 22, 2008.
On August 22, 2008, Defendants filed Petitions to the United
States Supreme Court for writ of certiorari. Given the Appeals
Court's earlier refusal of the appeal, NiSource adjusted its
reserve in the second quarter of 2008 to reflect the portion of
the Trial Court judgment for which NiSource would be responsible,
inclusive of interest. This amount was included in "Legal and
environmental reserves," on the Consolidated Balance Sheet as of
December 31, 2008. On October 24, 2008, the Trial Court
preliminarily approved a Settlement Agreement with a total
settlement amount of $380 million. The settlement received final
approval by the Trial Court on November 22, 2008. NiSource's
share of the settlement liability is up to $338.8 million.
NiSource complied with its obligations under the Settlement
Agreement to fund $85.5 million in the qualified settlement fund
by January 13, 2009. Additionally, NiSource provided a letter of
credit on January 13, 2009, in the amount of $254 million and
thereby complied with its obligation to secure the unpaid portion
of the settlement. The letter of credit was terminated on
December 29, 2010.
The Trial Court entered its Order discharging the judgment on
January 20, 2009, and is supervising the administration of the
settlement proceeds. On June 21, 2011, the Court issued the
Second Supplemental Order to conclude administration of
settlement. The Order sets forth the specific steps to be taken
by the Parties to close administration of the settlement and
terminate the settlement fund. As of June 30, 2011, NiSource has
contributed a total of $338.5 million into the qualified
settlement fund, $330.5 million of which was contributed prior to
December 31, 2010. As of June 30, 2011, $0.3 million of the
maximum settlement liability has not been paid. NiSource will be
required to make additional payments, pursuant to the settlement,
upon notice from the Class Administrator; however, NiSource does
not expect these additional payments to be material.
NISOURCE INC: Gives $28.7-Mil. to "Thacker" Suit Settlement Fund
----------------------------------------------------------------
NiSource Inc. contributed $28.7 million to a fund that was
established for the administration of the settlement in the
lawsuit commenced by John Thacker against its subsidiary,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
On February 8, 2007, Plaintiff filed the case captioned John
Thacker, et al. v. Chesapeake Appalachia, L.L.C., U.S. District
Court, E.D. Kentucky, a purported class action alleging that
Chesapeake has failed to pay royalty owners the correct amounts
pursuant to the provisions of their oil and gas leases covering
real property located within the state of Kentucky. The Company's
subsidiary, Columbia Energy Group, has assumed the defense of
Chesapeake in this matter pursuant to the provisions of the Stock
Purchase Agreement dated July 3, 2003, among Columbia, NiSource,
and Triana Energy Holding, Inc., Chesapeake's predecessor in
interest ("Stock Purchase Agreement"). Plaintiffs filed an
Amended Complaint on March 19, 2007, which, among other things,
added NiSource and Columbia as Defendants. On March 31, 2008, the
Court denied a Motion by Defendants to Dismiss and on June 3,
2008, the Plaintiffs moved to certify a class consisting of all
persons entitled to payment of royalty by Chesapeake under leases
operated by Chesapeake at any point after February 5, 1992, on
real property in Kentucky.
In June 2009, the parties to the Thacker litigation presented a
Settlement Agreement to the Court for preliminary approval, which
provides for a settlement amount of $28.8 million. NiSource fully
reserved for the entire settlement amount. The court granted the
Motion for Preliminary Approval and held a fairness hearing on
November 10, 2009. On March 3, 2010, the Court granted final
approval of the settlement and on March 31, 2010, a notice of
appeal of that approval was filed with the Sixth Circuit. On
February 17, 2011, the Sixth Circuit affirmed the lower court's
approval of the settlement.
On June 17, 2011, an escrow was established for the administration
of the settlement. On June 21, 2011, NiSource contributed $28.7
million to the fund with a reservation of right to seek recovery
from Chesapeake.
NORTHERN IRELAND: May Face Class Action Over Detention Policy
-------------------------------------------------------------
Belfast Telegraph reports that thousands of crime suspects in
Northern Ireland could sue over potentially being held in police
custody beyond the maximum permitted detention period, a court has
heard.
As a Belfast man facing burglary allegations launched a legal bid
to have charges against him quashed, his lawyer set out the
possibility of mass litigation.
The case, heard on Aug. 2 by three High Court judges, centers on
the amount of time police have to question suspected criminals.
Emergency laws were introduced in England and Wales following a
shock ruling that time spent on police bail counted towards the
maximum 96-hour limit of pre-charge detention.
Mr. Justice McCombe's verdict earlier this year, in a case
involving murder suspect Paul Hookway, effectively had given
detectives just four days from arrest to gather evidence against a
person and then either charge or release them.
For years, police regularly bailed suspects and brought them back
for questioning at a later date.
But despite Northern Ireland operating under similar Police and
Criminal Evidence (PACE) legislation, similar changes to the law
have yet to be introduced by Stormont. The situation has prompted
a judicial review challenge by James Connelly, who was charged
with burglary offenses last month.
Mr. Connelly of Cliftonpark Avenue, Belfast, was first arrested in
April, and then questioned again in June and July.
His lawyers are seeking an order quashing decisions by the PSNI to
detain him on the latter two occasions and to charge him.
His legal team argued that the period of detention -- an initial
24 hours which can be extended up to the 96-hour limit -- had
elapsed and police had no right to bring him back in.
It was also disputed that the PACE detention clock can be stopped
while the suspect is on pre-charge police bail and then restarted
when he is brought back into custody.
Paul Maguire QC, for the PSNI, pointed out that Mr. Connelly was
detained just under six-and-a-half hours in total.
The judges, Lord Chief Justice Sir Declan Morgan, Mr. Justice
Weatherup and Mr. Justice McCloskey, reserved their decision on
the challenge.
PILGRIM'S PRIDE: Reaches Verbal Pact to Settle Securities Suit
--------------------------------------------------------------
The parties of a consolidated complaint styled In re: Pilgrim's
Pride Corporation Securities Litigation, have verbally agreed to
settle the issues between them, according to Pilgrim's Pride
Corp.'s July 29, 2011, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended June 26, 2011.
On October 29, 2008, Ronald Acaldo filed suit in the U.S. District
Court for the Eastern District of Texas, Marshall Division,
against the Company and individual defendants Lonnie "Bo" Pilgrim,
Lonnie Ken Pilgrim, J. Clinton Rivers, Richard A. Cogdill and
Clifford E. Butler. The Complaint alleged that the Company and the
individual defendants violated sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, as amended, and Rule 10b-5
promulgated thereunder, by allegedly failing to disclose that "(i)
the Company's hedges to protect it from adverse changes in costs
were not working and in fact were harming the Company's results
more than helping; (ii) the Company's inability to continue to use
illegal workers would adversely affect its margins; (iii) the
Company's financial results were continuing to deteriorate rather
than improve, such that the Company's capital structure was
threatened; (iv) the Company was in a much worse position than its
competitors due to its inability to raise prices for consumers
sufficient to offset cost increases, whereas its competitors were
able to raise prices to offset higher costs affecting the
industry; and (v) the Company had not made sufficient changes to
its business to succeed in the more difficult industry
conditions." Mr. Acaldo further alleged that he purports to
represent a class of all persons or entities who acquired the
common stock of the Company from May 5, 2008 through September 24,
2008. The Complaint sought unspecified injunctive relief and an
unspecified amount of damages.
On November 21, 2008, defendants filed a Motion to Dismiss and
Brief in Support Thereof, asserting that plaintiff failed to
identify any misleading statements, failed to adequately plead
scienter against any defendants, failed to adequately plead loss
causation, failed to adequately plead controlling person liability
and, as to the omissions that plaintiff alleged defendants did not
make, defendants alleged that the omissions were, in fact,
disclosed.
On November 13, 2008, Chad Howes filed suit in the U.S. District
Court for the Eastern District of Texas, Marshall Division,
against the Company and individual defendants Lonnie "Bo" Pilgrim,
Lonnie Ken Pilgrim, J. Clinton Rivers, Richard A. Cogdill and
Clifford E. Butler. The allegations in the Howes Complaint are
identical to those in the Acaldo Complaint, as are the class
allegations and relief sought. The defendants were never served
with the Howes Complaint.
On May 14, 2009, the Court consolidated the Acaldo and Howes cases
and renamed the style of the case, "In re: Pilgrim's Pride
Corporation Securities Litigation." On May 21, 2009, the Court
granted the Pennsylvania Public Fund Group's Motion for
Appointment of Lead Plaintiff. Thereafter, on June 26, 2009, the
lead plaintiff filed a Consolidated (and amended) Complaint. The
Consolidated Complaint dismissed the Company and Clifford E.
Butler as Defendants. In addition, the Consolidated Complaint
added the following directors as Defendants: Charles L. Black, Key
Coker, Blake D. Lovette, Vance C. Miller, James G. Vetter, Jr.,
Donald L. Wass, Linda Chavez, and Keith W. Hughes. The
Consolidated Complaint alleges four causes of action violations of
Sections 10(b) and 20(a) of the Securities and Exchange Act of
1934, as amended, and Rule 10b-5 promulgated thereunder solely
against Lonnie "Bo" Pilgrim, Clint Rivers, and Richard A. Cogdill
(the "Officer Defendants"). Those claims assert that, during the
Class Period of May 5, 2008 through October 28, 2008, the
defendants, through various financial statements, press releases
and conference calls, made material misstatements of fact and/or
omitted to disclose material facts by purportedly failing to
completely impair the goodwill associated with the Gold Kist
acquisition. The Consolidated Complaint also asserts claims under
Section 11 of the Securities Act of 1933 against all defendants,
asserting that, statements made in a registration statement in
connection with the May 14, 2008 secondary offering of the
Company's common stock were materially false and misleading for
their failure to completely impair the goodwill associated with
the Gold Kist acquisition. Finally, the Consolidated Complaint
asserts a violation of Section 15 of the Securities Act of 1933
against the Officer Defendants only, claiming that the Officer
Defendants were controlling persons of the Company and the other
defendants in connection with the Section 11 violation. By the
Consolidated Complaint, the lead plaintiff seeks certification of
the Class, undisclosed damages, and costs and attorneys' fees.
On July 27, 2009, defendants filed a Motion to Dismiss the
Consolidated Complaint for its failure to adequately plead, as to
the Sections 10(b) and 20(a) claims, scienter and loss causation
and, as to the Sections 11 and 15 claims, for its failure to
adequately plead misrepresentations and omissions. Defendants
requested that the Consolidated Complaint be dismissed with
prejudice. The plaintiffs filed an Opposition to the Motion to
Dismiss on August 27, 2009. Defendants filed a Reply Brief on
September 10, 2009 and plaintiffs filed a Sur-Reply on September
24, 2009. The Court has not yet ruled on the Motion to Dismiss.
On August 17, 2010, the Court issued its Memorandum Opinion and
Order on the motion to dismiss, granting in part and denying in
part, the defendants' motion. The Court dismissed without
prejudice the plaintiffs' claims alleging securities fraud under
Section 10(b) of the Exchange Act and Rule 10b-5 and for
controlling person liability under Section 20(a) of the Exchange
Act. The Court denied defendants' motion to dismiss with respect
to the plaintiffs' claim for negligent misrepresentation under
Section 11 of the Securities Act and for controlling person
liability under Section 15 of the Securities Act. The plaintiffs
were granted leave to amend their complaint but elected not to do
so. The defendants filed their Original Answer to the Complaint on
November 15, 2010.
On May 9, 2011, the Court issued an Order setting a class
certification hearing for February 7, 2012 and ordering the
parties to confer and file a Docket Control Order by May 26, 2011.
Thereafter, as per the Court's Order, the parties negotiated a
proposed Docket Control Order, which was signed by the Court on
May 31, 2011.
The parties have since reached a verbal agreement to settle this
matter, subject to the execution of settlement documents. In the
interim, the parties have agreed not to engage in discovery. If
the case does not settle as expected, the defendants intend to
defend vigorously against the merits of the action and any
attempts by the Lead Plaintiff to certify a class action.
PILGRIM'S PRIDE: Awaits Ruling on Motion to Dismiss ERISA Suit
--------------------------------------------------------------
The U.S. District Court for the Eastern District of Texas still
has yet to rule on Pilgrim's Pride Corp.'s motion to dismiss an
amended consolidated complaint alleging ERISA violations,
according to the Company's July 29, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 26, 2011.
On December 17, 2008, Kenneth Patterson filed suit in the U.S.
District Court for the Eastern District of Texas, Marshall
Division, against Lonnie "Bo" Pilgrim, Lonnie Ken Pilgrim,
Clifford E. Butler, J. Clinton Rivers, Richard A. Cogdill, Renee
N. DeBar, the Company's Compensation Committee and other unnamed
defendants. On January 2, 2009, a nearly identical suit was filed
by Denise M. Smalls in the same court against the same defendants.
The complaints in both actions, brought pursuant to section 502 of
the Employee Retirement Income Security Act of 1974 ("ERISA"), 29
US C. Section 1132, alleged that the individual defendants
breached fiduciary duties to participants and beneficiaries of the
Pilgrim's Pride Stock Investment Plan (the "Stock Plan"), as
administered through the Pilgrim's Pride Retirement Savings Plan
(the "RSP"), and the To-Ricos, Inc. Employee Savings and
Retirement Plan by failing to sell the common stock held by the
Plans before it declined in value in late 2008, based on factual
allegations similar to the allegation made in the Acaldo
securities case discussed above. Patterson and Smalls further
alleged that they purported to represent a class of all persons or
entities who were participants in or beneficiaries of the Plans at
any time between May 5, 2008 through the present and whose
accounts held the Company's common stock or units in its common
stock. Both complaints sought actual damages in the amount of any
losses the Plans suffered, to be allocated among the participants'
individual accounts as benefits due in proportion to the accounts'
diminution in value, attorneys' fees, an order for equitable
restitution and the imposition of constructive trust, and a
declaration that each of the defendants have breached their
fiduciary duties to the Plans' participants.
On July 20, 2009, the Court entered an order consolidating the
Smalls and Patterson actions. On August 12, 2009, the Court
ordered that the consolidated case will proceed under the caption
"In re Pilgrim's Pride Stock Investment Plan ERISA Litigation, No.
2:08-cv-472-TJW."
Patterson and Smalls filed a consolidated amended complaint on
March 2, 2010. The Amended Complaint names as defendants the
Pilgrim's Pride Board of Directors, Lonnie "Bo" Pilgrim, Lonnie
Ken Pilgrim, Charles L. Black, Linda Chavez, S. Key Coker, Keith
W. Hughes, Blake D. Lovette, Vance C. Miller, James G. Vetter,
Jr., Donald L. Wass, J. Clinton Rivers, Richard A. Cogdill, the
Pilgrim's Pride Pension Committee, Robert A. Wright, Jane
Brookshire, Renee N. DeBar, the Pilgrim's Pride Administrative
Committee, Gerry Evenwel, Stacey Evans, Evelyn Boyden, and "John
Does 1-10." The Amended Complaint purports to assert claims on
behalf of persons who were participants in or beneficiaries of the
RSP or the To-Ricos Plan at any time between January 29, 2008
through December 1, 2008, and whose accounts included investments
in the Company's common stock.
Like the original Patterson and Smalls complaints, the Amended
Complaint alleges that the defendants breached ERISA fiduciary
duties to participants and beneficiaries of the RSP and To-Ricos
Plan by permitting both Plans to continue investing in the
Company's common stock during the alleged class period. The
Amended Complaint also alleges that certain defendants were
"appointing" fiduciaries who failed to monitor the performance of
the defendant-fiduciaries they appointed. Further, the Amended
Complaint alleges that all defendants are liable as co-fiduciaries
for one another's alleged breaches. Plaintiffs seek actual damages
in the amount of any losses the RSP and To-Ricos Plan attributable
to the decline in the value of the common stock held by the Plans,
to be allocated among the participants' individual accounts as
benefits due in proportion to the accounts' alleged diminution in
value, costs and attorneys' fees, an order for equitable
restitution and the imposition of constructive trust, and a
declaration that each of the defendants have breached their ERISA
fiduciary duties to the RSP and To-Ricos Plan's participants.
The defendants filed a motion to dismiss the Amended Complaint on
May 3, 2010. The plaintiffs responded to that motion on July 2,
2010, dropping plaintiff Smalls from the case and adding an
additional plaintiff, Stanley Sylvestros. The defendants filed
their reply in support of their motion to dismiss on August 2,
2010. The court has not yet ruled on the motion to dismiss.
PRESCRIPTION DRUG STORES: Sup. Ct. to Decide on Class Action Row
----------------------------------------------------------------
John O'Brien, writing for Legal Newsline, reports that the U.S.
Supreme Court will have the opportunity to decide if West Virginia
Attorney General Darrell McGraw is acting like a class action
lawyer.
CVS, on behalf of itself and its co-defendants in one of McGraw's
lawsuits, has decided to appeal a ruling by the U.S. Court of
Appeals for the Fourth Circuit that said Mr. McGraw has not filed
a class action against it. A 2-1 vote by a panel of Fourth
Circuit judges in May decided the case for Mr. McGraw, and the
court has declined to have the entire roster of judges hear the
matter.
CVS, Wal-Mart, Target, Walgreen, Kroger and Kmart claim
Mr. McGraw's case, which alleges the companies did not pass
savings on generic prescription drugs onto consumers, is a class
action and should be heard in federal court.
In their motion to stay the Fourth Circuit's decision pending an
appeal to the U.S. Supreme Court, the drug stores said on Aug. 1
that the decision has created a conflict with decisions by the
Fifth and Ninth circuits.
"In light of the newly formed circuit split concerning the reach
of (the Class Action Fairness Act) to a complaint brought by a
state Attorney General nominally acting as parens patriae, the
district courts' divergent approaches to this issue and the sharp
disagreement reflected in this Court's panel opinion, the
Defendants intend to file their petition to the United States
Supreme Court asking for review of the majority's Opinion," the
motion says.
The motion was granted on Aug. 2. In its appeal brief to the
Fourth Circuit, the group of pharmacies claimed Mr. McGraw's
lawsuit satisfies the jurisdictional requirements of the federal
CAFA.
"The AG's allegations make abundantly clear that more than $5
million and the interests of more than 100 persons are at issue.
If the rightful interests of the West Virginia consumers on whose
behalf the AG has brought suit are recognized, there also is
undeniably minimal diversity between at least some plaintiffs (who
are West Virginia citizens) and all defendants (as none of the
defendants reside in or is a citizen of West Virginia)."
The pharmacies added that any consumer who was allegedly
overcharged is a real party-in-interest to the case.
The May decision says the West Virginia statutes on which
Mr. McGraw relies contain none of the essential requirements for a
class action. Mr. McGraw is not designated as a member of the
class and he is not required to give notice to overcharged
customers, the decision says.
"Indeed, the West Virginia Attorney General's role here is more
analogous to the role of the EEOC or other regulator when it
brings an action on behalf of a large group of employees or a
segment of the public," the decision says. "Yet, the Supreme
Court has concluded that such a regulator's action is not a class
action of the kind defined in Rule 23."
Judge Ronald Lee Gilman dissented. Even though the action was
brought under state statutes, it doesn't take away the "essence"
of the case, he wrote.
"(T)he elements of numerosity, commonality, typicality and
adequacy of representation have not been specifically pleaded,"
Judge Gilman wrote. "But I submit that these are subsidiary
factors that do not detract from the essence of the action.
"They are, in other words, 'bells and whistles' whose absence in
the pleadings do not prevent the Attorney General's suit from
being considered a class action under CAFA."
Judge Gilman wrote that similar lawsuits filed by Mr. McGraw's
outside counsel in other states are undisputed class actions.
Mr. McGraw hired two private firms -- Bailey & Glasser and
DiTrapano Barrett & DiPiero -- for the case. The two firms have
contributed more than $60,000 to Mr. McGraw's campaign fund over
the years, including $11,800 for his 2008 race against Republican
Dan Greear.
Bailey & Glasser brought similar lawsuits in Michigan and
Minnesota. The Michigan suits were dismissed by a state judge
because the only specific pricing information was obtained by a
West Virginia whistleblower who worked at Kroger.
The Minnesota lawsuit, brought on behalf of unions that provide
health care for their members, was initially dismissed in November
2009 by former U.S. District Judge James Rosenbaum, who had harsh
words for the plaintiffs attorneys.
Judge Rosenbaum was peeved that the complaint, filed against 13
defendants, only contained specific pricing information about two
of them.
"(T)his Complaint utterly fails to state a cause of action on any
basis. There are no, none, factual allegations touching any
defendant other than CVS and Walgreen's," Judge Rosenbaum said on
Nov. 20, 2009.
"There being no facts from which a fact finder could infer any
liability concerning (the other defendants), and you asked me to
sustain a complaint based upon that. It's not only laughable,
it's absolutely reprehensible."
A federal magistrate judge is currently deciding if that lawsuit
will be remanded to a Minnesota court.
RBS GLOBAL: 8th Circuit Affirms Class Standing in Suit Vs. Zurn
---------------------------------------------------------------
The U.S. Court of Appeals for the Eighth Circuit affirmed the
class certification order of a Minnesota court in the lawsuit
against RBS Global, Inc.'s subsidiaries, according to the
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended July 2,
2011.
Certain Water Management subsidiaries are subject to asbestos and
class action related litigation. As of July 2, 2011, the
Company's subsidiaries, Zurn PEX, Inc. and Zurn Industries LLC,
formerly known as Zurn Industries, Inc., and an average of
approximately 80 other unrelated companies were defendants in
approximately 7,100 asbestos related lawsuits representing
approximately 27,500 claims. Plaintiffs' claims allege personal
injuries caused by exposure to asbestos used primarily in
industrial boilers formerly manufactured by a segment of Zurn.
Zurn did not manufacture asbestos or asbestos components.
Instead, Zurn purchased them from suppliers. These claims are
being handled pursuant to a defense strategy funded by insurers.
As of July 2, 2011, the Company estimates the potential liability
for asbestos-related claims pending against Zurn as well as the
claims expected to be filed in the next ten years to be
approximately $65.0 million of which Zurn expects to pay
approximately $53.0 million in the next ten years on such claims,
with the balance of the estimated liability being paid in
subsequent years. However, there are inherent uncertainties
involved in estimating the number of future asbestos claims,
future settlement costs, and the effectiveness of defense
strategies and settlement initiatives.
Zurn Litigation
Zurn PEX and Zurn Industries have been named as defendants in
fourteen lawsuits, brought between July 2007 and December 2009, in
various United States courts (MN, ND, CO, NC, MT, AL, VA, LA, NM,
MI and HI). The plaintiffs in these lawsuits represent (in the
case of the proceedings in Minnesota), or seek to represent, a
class of plaintiffs alleging damages due to the alleged failure or
anticipated failure of the Zurn brass crimp fittings on the PEX
plumbing systems in homes and other structures. The complaints
assert various causes of action, including but not limited to
negligence, breach of warranty, fraud, and violations of the
Magnuson Moss Act and certain state consumer protection laws, and
seek declaratory and injunctive relief, and damages (including
punitive damages). All but the Hawaii lawsuit, which remains in
Hawaii state court, have been transferred to a multi-district
litigation docket in the District of Minnesota for coordinated
pretrial proceedings. The court in the Minnesota proceedings
certified certain classes of plaintiffs in Minnesota for
negligence and negligent failure to warn claims and for breach of
warranty claims.
On July 6, 2011, the U.S. Court of Appeals for the Eighth Circuit
affirmed the class certification order of the Minnesota court.
Class certification has not been granted in the other state court
actions. The Company's insurance carriers currently are funding
the Company's defense in these proceedings; however, they have
filed lawsuit for a declaratory judgment in Florida state court
challenging their coverage obligations with respect to certain
classes of claims. The Florida lawsuit currently is stayed,
pending resolution of the underlying claims. Although the Company
continues to vigorously defend itself in the various court
proceedings and continues to vigorously pursue insurance coverage,
the uncertainties of litigation, and insurance coverage and
collection, as well as the actual number or value of claims, may
subject the Company to substantial liability that could have a
material adverse effect on the Company.
RIGEL PHARMACEUTICALS: Appeal in Consolidated Suit Still Pending
----------------------------------------------------------------
An appeal from the dismissal of a consolidated securities lawsuit
against Rigel Pharmaceuticals, Inc., remains pending, according to
the Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
On February 6, 2009, a purported securities class action lawsuit
was commenced in the United States District Court for the Northern
District of California, naming as defendants the Company and
certain of its officers, directors and underwriters for its
February 2008 public offering of common stock (Stock Offering).
An additional purported securities class action lawsuit containing
similar allegations was subsequently filed in the United States
District Court for the Northern District of California on
February 20, 2009. By order of the Court dated March 19, 2009,
the two lawsuits were consolidated into a single action. On
June 9, 2009, the Court issued an order naming the Inter-Local
Pension Fund GCC/IBT as lead plaintiff and Robbins Geller Rudman &
Dowd LLP (formerly Coughlin Stoia) as lead counsel. The lead
plaintiff filed a consolidated complaint on July 24, 2009. The
Company filed a motion to dismiss on September 8, 2009. On
December 21, 2009, the Court granted the Company's motion and
dismissed the consolidated complaint with leave to amend.
Plaintiff filed its consolidated amended complaint on January 27,
2010. The lawsuit alleged violations of the Securities Act and
the Exchange Act in connection with allegedly false and misleading
statements made by the Company related to the results of the Phase
2a clinical trial of the Company's product candidate fostamatinib
(then known as R788). The plaintiff sought damages, including
rescission or rescissory damages for purchasers in the Stock
Offering, an award of their costs and injunctive and/or equitable
relief for purchasers of the Company's common stock during the
period between December 13, 2007, and February 9, 2009, including
purchasers in the Stock Offering. The Company filed a motion to
dismiss the consolidated amended complaint on February 16, 2010.
On August 24, 2010, the Court issued an order granting the
Company's motion and dismissed the consolidated complaint with
leave to amend. On September 22, 2010, plaintiff filed a notice
informing the Court that it will not amend its complaint and
requested that the Court enter a final judgment. On October 28,
2010, the plaintiff submitted a proposed judgment requesting entry
of such judgment in favor of the defendants. On November 1, 2010,
judgment was entered dismissing the action. The plaintiff filed a
notice of appeal on November 15, 2010, appealing the district
court's order granting the Company's motion to dismiss the
consolidated amended complaint. The plaintiff filed its opening
brief on February 23, 2011. The Company filed its opposition
brief on April 8, 2011. On May 9, 2011, the plaintiff filed its
reply brief.
No further updates were reported in the Company's latest SEC
filing.
The Company believes that it has meritorious defenses and intends
to defend this lawsuit vigorously.
ROYAL CARIBBEAN: Awaits Ruling on Bid to Dismiss Florida Suit
-------------------------------------------------------------
Royal Caribbean Cruises Ltd. is awaiting a court decision on its
motion to dismiss a class action lawsuit in Florida, according to
the Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
In June 2011, a class action complaint was filed against Royal
Caribbean Cruises Ltd. in the United States District Court for the
Southern District of Florida on behalf of a purported class of
stateroom attendants employed onboard Royal Caribbean
International cruise vessels alleging that they were required to
pay other crew members to help with their duties in violation of
the U.S. Seaman's Wage Act. The lawsuit also alleges that certain
lower rated stateroom attendants were required to work back of
house assignments without the ability to earn gratuities in
violation of the U.S. Seaman's Wage Act. Plaintiffs seek judgment
for damages, wage penalties and interest in an indeterminate
amount. The Company has filed a Motion to Dismiss the Complaint
on the basis that the applicable collective bargaining agreement
requires any such claims to be arbitrated.
The Company also believes it has meritorious defenses to the
lawsuit, which it intends to vigorously pursue.
SEACOR HOLDINGS: Oral Argument in "Robin" Suit Set for Aug. 24
--------------------------------------------------------------
The Court has scheduled for August 24, 2011, oral argument on
SEACOR Holdings Inc.'s motion to dismiss claims in the lawsuit
commenced by Terry G. Robin, according to the Company's August 1,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
On July 14, 2010, a group of individuals and entities purporting
to represent a class commenced a civil action in the U.S. District
Court for the Eastern District of Louisiana, Terry G. Robin, et
al. v. Seacor Marine, L.L.C., et al., No. 2:10-cv-01986 (E.D.
La.), in which they assert that support vessels, including vessels
owned by the Company, responding to the explosion and resulting
fire that occurred aboard the semi-submersible drilling rig, the
Deepwater Horizon, were negligent in their efforts to save lives
and put out the fire and contributed to the sinking of the
Deepwater Horizon and subsequent oil spill. The action now is
part of the overall multi-district litigation ("MDL"), In re Oil
Spill by the Oil Rig "Deepwater Horizon", MDL No. 2179. The
complaint seeks compensatory, punitive, exemplary, and other
damages.
The Company believes that this lawsuit brought by class action
lawyers targeting emergency responders, acting under the direction
of the U.S. Coast Guard, has no merit and will seek its dismissal.
The Company also recently filed petitions seeking exoneration
from, or limitation of liability in relation to, any actions that
may have been taken by vessels owned by the Company to extinguish
the fire. Pursuant to the Limitation of Liability Act, those
petitions impose an automatic stay on the Robin case, and the
court set a deadline of April 20, 2011, for individual claimants
to assert claims in the limitation cases. Approximately 66 claims
were submitted by the deadline in all of the limitation actions.
On June 8, 2011, the Company moved to dismiss these claims (with
the exception of one claim filed by a Company employee) on various
legal grounds. Oral argument on the motion is scheduled for
August 24, 2011.
SEACOR HOLDINGS: Plaintiffs Appeal Dismissal of Antitrust Suit
--------------------------------------------------------------
Plaintiffs have taken appeal from the dismissal of their antitrust
class action lawsuit against SEACOR Holdings Inc., according to
the Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
On June 12, 2009, a purported civil class action was filed against
the Company, Era Group Inc., Era Helicopters LLC and three other
defendants (collectively, the "Defendants") in the U.S. District
Court for the District of Delaware, Superior Offshore
International, Inc. v. Bristow Group Inc., et al., No. 09-CV-438
(D. Del.). The Complaint alleges that the Defendants violated
federal antitrust law by conspiring with each other to raise, fix,
maintain or stabilize prices for offshore helicopter services in
the U.S. Gulf of Mexico during the period January 2001 to December
2005. The purported class of plaintiffs includes all direct
purchasers of such services and the relief sought includes
compensatory damages and treble damages. The Company believes
that the claims set forth in the Complaint are without merit and
intends to vigorously defend the action. On September 4, 2009,
the Defendants filed a motion to dismiss the Complaint. On
September 14, 2010, the Court entered an order dismissing the
Complaint. On September 28, 2010, the plaintiffs filed a motion
for reconsideration and amendment and a motion for re-argument
(the "Motions"). On November 30, 2010, the Court granted the
Motions, amended the Court's September 14, 2010 Order to clarify
that the dismissal was without prejudice, permitted the filing of
an Amended Complaint, and authorized limited discovery with
respect to the new allegations in the Amended Complaint.
Following the completion of such limited discovery, on
February 11, 2011, the Defendants filed a motion for summary
judgment to dismiss the Amended Complaint with prejudice. On June
23, 2011, the Court granted summary judgment for the Defendants.
On July 22, 2011, the plaintiffs filed a notice of appeal to the
U.S. Court of Appeals for the Third Circuit.
The Company says it is unable to estimate the potential exposure,
if any, resulting from these claims but believes they are without
merit and will continue to vigorously defend the action.
SHARP ENTERTAINMENT: Sued for Unauthorized Filming in Chicago
-------------------------------------------------------------
Jennifer Zglobicki, Individually, and on Behalf of All Others
Similarly Situated v. Sharp Entertainment, LLC, a New York Limited
Liability Company, and The Travel Channel, LLC, a Delaware Limited
Liability Company, Case No. 2011-CH-27302 (Ill. Cir. Ct., Cook
Cty., August 2, 2011) is brought for injunctive relief and
compensatory damages pursuant to the Illinois Right of Publicity
Act.
Ms. Zglobicki alleges that Sharp filmed her while she was a
customer at the Chicago hot dog restaurant, The Wiener's Circle,
for an episode of a television program called "Extreme Fast Food."
She contends that in violation of the Illinois Compiled Statutes,
neither Sharp nor Travel Channel obtained her consent to use, air,
broadcast or share her image or likeness.
Ms. Zglobicki, at all relevant times, was a citizen of the city of
Chicago, county of Cook, and state of Illinois.
Sharp was a New York Limited Liability Company, producing
television programming in Illinois, which it sold to Travel
Channel. Travel Channel was a cable and satellite programming
company that broadcasts television programming worldwide,
including broadcasting into the state of Illinois.
The Plaintiff is represented by:
Nicholas S. Lane, Esq.
LAW OFFICES OF NICHOLAS S. LANE
35 E. Wacker, 9th floor
Chicago, IL 60601
Telephone: (312) 854-7160
- and -
Terrence Buehler, Esq.
TOUHY, TOUHY, BUEHLER, & WILLIAMS, LLP
55 W. Wacker, Ste. 1400
Chicago, IL 60601
Telephone: (312) 372-2209
SILICON LABORATORIES: Appeal in Securities Suit Still Pending
-------------------------------------------------------------
An appeal from the approval of a settlement resolving a
consolidated securities lawsuit remains pending, according to
Silicon Laboratories Inc.'s August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
July 2, 2011.
On December 6, 2001, a class action complaint for violations of
U.S. federal securities laws was filed in the United States
District Court for the Southern District of New York against the
Company, four officers individually and the three investment
banking firms who served as representatives of the underwriters in
connection with the Company's initial public offering of common
stock. The Consolidated Amended Complaint alleges that the
registration statement and prospectus for the Company's initial
public offering did not disclose that (1) the underwriters
solicited and received additional, excessive and undisclosed
commissions from certain investors, and (2) the underwriters had
agreed to allocate shares of the offering in exchange for a
commitment from the customers to purchase additional shares in the
aftermarket at pre-determined higher prices. The Complaint
alleges violations of the Securities Act of 1933 and the
Securities Exchange Act of 1934. The action seeks damages in an
unspecified amount and is being coordinated with approximately 300
other nearly identical actions filed against other companies. A
court order dated October 9, 2002, dismissed without prejudice the
four officers of the Company who had been named individually.
On December 5, 2006, the Second Circuit vacated a decision by the
District Court granting class certification in six of the
coordinated cases, which are intended to serve as test, or "focus"
cases. The plaintiffs selected these six cases, which do not
include the Company. On April 6, 2007, the Second Circuit denied
a petition for rehearing filed by the plaintiffs, but noted that
the plaintiffs could ask the District Court to certify more narrow
classes than those that were rejected.
The parties in the approximately 300 coordinated cases, including
the parties in the case against the Company, reached a settlement.
The insurers for the issuer defendants in the coordinated cases
will make the settlement payment on behalf of the issuers,
including the Company. On October 5, 2009, the Court granted
final approval of the settlement. Judgment was entered on
January 10, 2010. The settlement approval was appealed to the
United States Court of Appeals for the Second Circuit. One appeal
was dismissed and the second appeal was remanded to the District
Court to determine if the appellant is a class member with
standing to appeal.
As the litigation process is inherently uncertain, the Company
says it is unable to predict the outcome of the matter if the
settlement does not survive appeal. While the Company does
maintain liability insurance, it could incur losses that are not
covered by its liability insurance or that exceed the limits of
its liability insurance. Such losses could have a material impact
on the Company's business and its results of operations or
financial position.
SKILLED HEALTHCARE: Pursues $10-Mil. Claim Over "Humboldt" Suit
---------------------------------------------------------------
Skilled Healthcare Group, Inc., continues to pursue a claim
through arbitration for $10 million in insurance coverage related
to the Humboldt County litigation that its insurer has denied,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
In connection with the September 2010 settlement of certain class
action litigation (the "Humboldt County Action") against Skilled
and certain of its subsidiaries, including twenty-two California
nursing facilities operated by Skilled's subsidiaries, Skilled and
its defendant subsidiaries entered into settlement agreements with
the applicable plaintiffs and agreed to an injunction. The
settlement was approved by the Superior Court of California,
Humboldt County on November 30, 2010. Under the terms of the
settlement agreements, the defendant entities deposited a total of
$50.0 million into escrow accounts to cover settlement payments to
class members, notice and claims administration costs, reasonable
attorneys' fees and costs and certain other payments. Pursuant to
the injunction, the twenty-two defendants that operate California
nursing facilities must provide specified nurse staffing levels,
comply with specified state and federal laws governing staffing
levels and posting requirements, and provide reports and
information to an auditor. The injunction will remain in effect
for a period of twenty-four months unless extended for additional
three-month periods as to those defendants that may be found in
violation. Defendants demonstrating compliance for an eighteen-
month period may petition for early termination of the injunction.
The Company is required to demonstrate over the term of the
injunction that the costs of the injunction meet a minimum
threshold level pursuant to the settlement agreement, which level,
initially $9.6 million, is reduced by the portion attributable to
any defendant in the case that no longer operates a skilled
nursing facility during the injunction period. The injunction
costs include, among other things, costs attributable to (i)
enhanced reporting requirements; (ii) implementing advanced
staffing tracking systems; (iii) fees and expenses paid to an
auditor and special master; (iv) increased labor and labor related
expenses; and (v) lost revenues attributable to admission
decisions based on compliance with the terms and conditions of the
injunction. To the extent the costs of complying with the
injunction are less than $9.6 million, the defendants will be
required to remit any shortfall to the settlement fund.
The Company continues to pursue a claim through arbitration for
approximately $10.0 million in insurance coverage related to the
litigation that the Company's insurer has denied.
SONIC AUTOMOTIVE: Awaits Ruling on Plea to Vacate Partial Award
---------------------------------------------------------------
Sonic Automotive, Inc., is still awaiting a decision on its
petition to vacate an arbitrator's partial final award on class
certification in a consolidated class action proceeding, according
to the Company's August 1, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
Several private civil actions have been filed against Sonic
Automotive, Inc. and several of its dealership subsidiaries that
purport to represent classes of customers as potential plaintiffs
and made allegations that certain products sold in the finance and
insurance departments were done so in a deceptive or otherwise
illegal manner. One of these private civil actions was filed on
November 15, 2004, in South Carolina state court, York County
Court of Common Pleas, against Sonic Automotive, Inc. and 10 of
Sonic's South Carolina subsidiaries. The plaintiffs in that
lawsuit were Misty J. Owens, James B. Wright, Vincent J. Astey and
Joseph Lee Williams, on behalf of themselves and all other persons
similarly situated, with plaintiffs seeking monetary damages and
injunctive relief on behalf of the purported class. The group of
plaintiffs' attorneys representing the plaintiffs in the South
Carolina lawsuit also filed another private civil class action
lawsuit against Sonic Automotive, Inc. and three of its
subsidiaries on February 14, 2005, in state court in North
Carolina, Lincoln County Superior Court, which similarly sought
certification of a multi-state class of plaintiffs and alleged
that certain products sold in the finance and insurance
departments were done so in a deceptive or otherwise illegal
manner. The plaintiffs in this North Carolina lawsuit were Robert
Price, Carolyn Price, Marcus Cappeletti and Kathy Cappeletti, on
behalf of themselves and all other persons similarly situated,
with plaintiffs seeking monetary damages and injunctive relief on
behalf of the purported class. The South Carolina state court
action and the North Carolina state court action have since been
consolidated into a single proceeding in private arbitration
before the American Arbitration Association. On November 12,
2008, claimants in the consolidated arbitration filed a Motion for
Class Certification as a national class action including all of
the states in which Sonic operates dealerships. Claimants are
seeking monetary damages and injunctive relief on behalf of this
class of customers. The parties have briefed and argued the issue
of class certification.
On July 19, 2010, the Arbitrator issued a Partial Final Award on
Class Certification, certifying a class which includes all
customers who, on or after November 15, 2000, purchased or leased
from a Sonic dealership a vehicle with the Etch product as part of
the transaction, but not including customers who purchased or
leased such vehicles from a Sonic dealership in Florida. The
Partial Final Award on Class Certification is not a final decision
on the merits of the action. The merits of Claimants' assertions
and potential damages will still have to be proven through the
remainder of the arbitration. The Arbitrator stayed the
Arbitration for thirty days to allow either party to petition a
court of competent jurisdiction to confirm or vacate the award.
Sonic will seek review of the class certification ruling by a
court of competent jurisdiction and will continue to press its
argument that this action is not suitable for a class-based
arbitration. On July 22, 2010, the plaintiffs in this
consolidated arbitration filed a Motion to Confirm the
Arbitrator's Partial Final Award on Class Certification in state
court in North Carolina, Lincoln County Superior Court. On
August 17, 2010, Sonic filed to remove this North Carolina state
court action to federal court, and simultaneously filed a Petition
to Vacate the Arbitrator's Partial Final Award on Class
Certification, with both filings made in the United Stated
District Court for the Western District of North Carolina.
Sonic says it intends to continue its vigorous defense of this
arbitration and to assert all available defenses. However, an
adverse resolution of this arbitration could result in the payment
of significant costs and damages, which could have a material
adverse effect on Sonic's future results of operations, financial
condition and cash flows. The Company is currently unable to
estimate a range of reasonably possible loss, or a range of
reasonably possible loss in excess of amount accrued, for this
litigation matter.
SONIC AUTOMOTIVE: Obtained Court Approval of "Galura" Settlement
----------------------------------------------------------------
Sonic Automotive, Inc. obtained in June 2011, court approval of
its settlement agreement resolving the lawsuit commenced by
Galura, et al., according to the Company's August 1, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2011.
Sonic is a defendant in the matter of Galura, et al. v. Sonic
Automotive, Inc., a private civil action filed in the Circuit
Court of Hillsborough County, Florida. In this action, originally
filed on December 30, 2002, the plaintiffs allege that Sonic and
its Florida dealerships sold an antitheft protection product in a
deceptive or otherwise illegal manner, and further sought
representation on behalf of any customer of any of Sonic's Florida
dealerships who purchased the antitheft protection product since
December 30, 1998. The plaintiffs are seeking monetary damages
and injunctive relief on behalf of this class of customers. In
June 2005, the court granted the plaintiffs' motion for
certification of the requested class of customers, but the court
has made no finding to date regarding actual liability in this
lawsuit. Sonic subsequently filed a notice of appeal of the
court's class certification ruling with the Florida Court of
Appeals. In April 2007, the Florida Court of Appeals affirmed a
portion of the trial court's class certification, and overruled a
portion of the trial court's class certification.
In November 2009, the Florida trial court granted Summary Judgment
in Sonic's favor against Plaintiff Enrique Galura, and his claim
has been dismissed. Marisa Hazelton's claim is still pending. At
a mediation held February 4, 2011, Sonic reached an agreement in
principle with the plaintiffs to settle this class action lawsuit,
and a settlement agreement was signed by the parties on March 1,
2011. The settlement agreement was approved by the Florida state
court on June 24, 2011. The Company says the terms of the
approved settlement will not have a material adverse effect on
Sonic's future results of operations, financial condition and cash
flows.
SONUS NETWORKS: One Appeal From Settlement Order Remains Pending
----------------------------------------------------------------
One appeal from the approval of a settlement agreement in the
consolidated securities lawsuit against Sonus Networks, Inc.,
remains pending, according to the Company's August 2, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2011.
In November 2001, a purchaser of the Company's common stock filed
a complaint in the United States District Court for the Southern
District of New York (the "District Court") against the Company,
two of its officers and the lead underwriters alleging violations
of the federal securities laws in connection with the Company's
initial public offering ("IPO") and seeking unspecified monetary
damages. The purchaser seeks to represent a class of persons who
purchased the Company's common stock between the date of the IPO
on May 24, 2000, and December 6, 2000. The amended complaint,
filed in April 2002, alleges that the Company's registration
statement contained false or misleading information or omitted to
state material facts concerning the alleged receipt of undisclosed
compensation by the underwriters and the existence of undisclosed
arrangements between the underwriters and certain purchasers to
make additional purchases in the after market. The claims against
the Company are asserted under Section 10(b) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and Section
11 of the Securities Act of 1933, as amended (the "Securities
Act"), and against the individual defendants under Sections 11 and
15 of the Securities Act and Sections 10(b) and 20(a) of the
Exchange Act. Other plaintiffs have filed substantially similar
class action cases against approximately 300 other publicly-traded
companies and their IPO underwriters which, along with the actions
against the Company, have been transferred to a single federal
judge for purposes of coordinated case management.
On July 15, 2002, the Company, collectively with the other issuers
named as defendants in these coordinated proceedings, filed a
collective motion to dismiss the consolidated amended complaints
on various legal grounds common to all or most of the issuer
defendants. The plaintiffs voluntarily dismissed the claims
against many of the individual defendants, including the Company's
officers named in the complaint. On February 19, 2003, the
District Court granted a portion of the motion to dismiss by
dismissing the Section 10(b) claims against certain defendants
including the Company, but denied the remainder of the motion as
to the defendants.
In October 2004, the District Court certified the class in a case
against certain defendants. On August 31, 2005, the District
Court approved the terms of the proposed settlement.
On December 5, 2006, the United States Court of Appeals for the
Second Circuit (the "Second Circuit") reversed the District
Court's October 2004 order certifying a class. On August 25,
2009, the plaintiffs filed a motion for final approval of the
proposed settlement, approval of the plan of distribution of the
settlement fund and certification of the settlement classes. A
settlement fairness hearing was held on September 10, 2009. On
October 5, 2009, the District Court issued an opinion granting
plaintiffs' motion for final approval of the settlement, approval
of the plan of distribution of a new settlement fund and
certification of the settlement classes. An Order and Final
Judgment was entered on January 14, 2010.
On October 7, 2010, all but two parties who had filed a notice of
appeal filed a stipulation with the Second Circuit withdrawing
their appeals with prejudice, and one of the remaining objectors
filed a brief in support of his appeal. On December 8, 2010,
plaintiffs moved to dismiss with prejudice the appeal filed by one
of the two appellants based on alleged violations of the Second
Circuit's rules, including failure to serve, falsifying proofs of
service, and failure to include citations to the record. On
May 17, 2011, the Second Circuit dismissed one of the appeals and
remanded the one remaining appeal to the District Court for
further proceedings to determine whether the remaining objector
has standing.
SPACE PENCIL: Accused of Exploiting Consumers' Web Browsers
-----------------------------------------------------------
John B. Kim, and Dan C. Schutzman, Individually, on Behalf of
Themselves and All Others Similarly Situated v. Space Pencil, Inc.
d/b/a KISSmetrics, BabyPips.com, Involver.com, Moo, Inc.,
Sitening, LLC, Shoedazzle.com, Inc., 8tracks Inc., About.me,
friend.ly, Giga Omni Media Inc., Hasoffers.com, Kongregate Inc.,
LiveMocha Inc., Rockettheme, LLC, Fitnesskeeper, Inc., Seomoz,
Inc., ShareCash, LLC, Slideshare.net, Spokeo, Inc., Spotify USA,
Inc., visual.ly, Conduit USA Inc., Flite, Inc., Tangient, LLC,
Etsy Inc., and iVillage, Inc., Case No. 3:11-cv-03796, (N.D.
Calif., August 1, 2011) alleges that the Defendants engaged in
tracking activities by exploiting the Plaintiffs and Class
Members' browsers and other software in ways that consumers did
not reasonably expect.
The Plaintiffs also allege that the Defendants acquired personal
information to which they were not entitled and which the
Plaintiffs and Class Members had affirmatively sought and
reasonably expected to prevent the Defendants from acquiring. The
Plaintiffs further argue that the Defendants engaged in deception
and concealment to gain access to the Plaintiffs and Class
Members' computers.
Mr. Kim is a resident of San Diego County, California. Mr.
Schutzman is a resident of Los Angeles County, California.
All of the Defendants, except KISSmetrics, are business
organizations operating certain Web sites. KISSmetrics is a
business organization, with principal executive offices and
headquarters in Redwood City, California.
The Plaintiffs are represented by:
Scott A. Kamber, Esq.
David A. Stampley, Esq.
KAMBERLAW, LLC
100 Wall Street, 23rd Floor
New York, NY 10005
Telephone: (212) 920-3072
Facsimile: (212) 920-3081
E-mail: skamber@.kamberlaw.com
dstampley@kamberlaw.com
- and -
David C. Parisi, Esq.
Suzanne Havens Beckman, Esq.
Azita Moradmand, Esq.
PARISI & HAVENS LLP
15233 Valleyheart Drive
Sherman Oaks, CA 91403
Telephone: (818) 990-1299
Facsimile: (818) 501-7852
E-mail: dcparisi@parisihavens.com
shavens@parisihavens.com
amoradmand@parisihavens.com
STRAYER EDUCATION: Va. Suit Stayed Pending Ruling on Dismissal Bid
------------------------------------------------------------------
The lawsuit against Strayer Education, Inc., filed in Fairfax
County has been stayed pending resolution of the motion to dismiss
the putative securities action pending in the Middle District of
Florida, according to the Company's August 1, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2011.
On October 15, 2010, a putative securities class action styled
Kinnett v. Strayer Education, Inc., et al ., was filed in the
United States District Court for the Middle District of Florida.
On April 19, 2011, the Company filed a motion to dismiss the
complaint. On January 3, 2011, a shareholder derivative complaint
styled Vakharloskaya v. Silberman et al., was filed in Florida
state court in Hillsborough County, Florida. On March 29, 2011,
the plaintiff and Strayer jointly submitted to the Florida state
court a stipulation recognizing that Fairfax, Virginia is a more
appropriate forum for this litigation. On April 4, 2011,
plaintiff filed a complaint in the Circuit Court of Fairfax
County, and on June 27, 2011, the Court stayed the action pending
resolution of the motion to dismiss in the securities class action
lawsuit.
The Company believes these lawsuits to be without merit and will
contest them vigorously. While the outcome of any legal
proceedings cannot be predicted with certainty, the Company does
not presently expect that these matters will have a material
effect on its financial condition or results of operations.
TENET HEALTHCARE: 'Katrina' Settlement for Final Review in October
------------------------------------------------------------------
A settlement negotiated by Tenet Healthcare Corp. to resolve two
class action lawsuits alleging hospital negligence during, and in
the wake of, Hurricane Katrina, is up for final review in October,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarterly
period ended June 30, 2011.
In March 2011, Tenet Healthcare and its subsidiaries agreed to
settle two previously reported class action lawsuits brought on
behalf of patients, their family members and others who were
present and allegedly injured at Memorial Medical Center, one of
the Company's former New Orleans area hospitals, during Hurricane
Katrina and its aftermath. A $25 million cash settlement payment,
which was fully reserved at March 31, 2011, will be apportioned
among the approximately 1,400 eligible class members who file a
proof of claim in the cases. The court preliminarily approved the
final settlement agreement on July 21, 2011. The settlement is
now subject to a fairness hearing with class members and final
review by the court, which is scheduled to occur in October 2011.
Six lawsuits filed by plaintiffs who chose to opt out of the class
proceedings involving Memorial Medical Center remain pending at
this time. As of June 30, 2011, trial dates had not been set in
these individual cases. In addition, a third previously reported
purported class action lawsuit, also filed in the Civil District
Court for the Parish of Orleans, remains pending. The class
certification hearing in that action, which was brought on behalf
of patients, their family members and others who were present and
allegedly injured following Hurricane Katrina at Lindy Boggs
Medical Center, another one of the Company's former New Orleans
area hospitals was postponed in late 2010 and has not yet been
rescheduled. Furthermore, 14 individual Hurricane Katrina-related
lawsuits remain pending against Lindy Boggs and two other New
Orleans-area hospitals that the Company has since divested --
Meadowcrest Hospital and Kenner Regional Medical Center. In
general, the plaintiffs allege that the hospitals were negligent
in failing to properly prepare for the storm, failing to evacuate
patients ahead of the storm, and failing to have properly
configured emergency generator systems, among other allegations of
general negligence. The plaintiffs seek damages in various and
unspecified amounts for the alleged wrongful death of some
patients, aggravation of pre-existing illnesses or injuries to
patients who survived and were successfully evacuated, and the
inability of patients and others to evacuate the hospitals for
several days under challenging conditions. The Company is unable
to predict the ultimate resolution of the pending lawsuits, but it
intends to continue to vigorously defend the hospitals in these
matters.
Tenet Healthcare Corporation is an investor-owned health care
services company whose subsidiaries and affiliates principally
operate acute care hospitals and related health care facilities.
At June 30, 2011, the Tenet subsidiaries operated 49 acute care
hospitals, including four academic medical centers, and one
critical access hospital, with a combined total of 13,420 licensed
beds, primarily serving urban and suburban communities in 11 U.S.
states.
TEREX CORP: Still Awaits Rulings on Bid to Dismiss Conn. Suits
--------------------------------------------------------------
Terex Corporation is still awaiting a court decision on its
motions to dismiss two class action lawsuits pending in
Connecticut, according to the Company's August 1, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2011.
The Company has received complaints seeking certification of class
action lawsuits in a lawsuit filed under the Employee Retirement
Income Security Act of 1974, a securities lawsuit and a
stockholder derivative lawsuit as follows:
* A consolidated complaint in the ERISA lawsuit was filed in
the United States District Court, District of Connecticut on
September 20, 2010, and is entitled In Re Terex Corp. ERISA
Litigation.
* A consolidated class action complaint for violations of
securities laws in the securities lawsuit was filed in the
United States District Court, District of Connecticut on
November 18, 2010, and is entitled Sheet Metal Workers Local
32 Pension Fund and Ironworkers St. Louis Council Pension
Fund, individually and on behalf of all others similarly
situated v. Terex Corporation, et al.
* A stockholder derivative complaint for violation of the
Securities and Exchange Act of 1934, breach of fiduciary
duty, waste of corporate assets and unjust enrichment was
filed on April 12, 2010, in the United States District
Court, District of Connecticut and is entitled Peter Derrer,
derivatively on behalf of Terex Corporation v. Ronald M.
DeFeo, Phillip C. Widman, Thomas J. Riordan, G. Chris
Andersen, Donald P. Jacobs, David A. Sachs, William H. Fike,
Donald DeFosset, Helge H. Wehmeier, Paula H.J. Cholmondeley,
Oren G. Shaffer, Thomas J. Hansen, and David C. Wang, and
Terex Corporation.
These lawsuits generally cover the period from February 2008 to
February 2009 and allege, among other things, that certain of the
Company's SEC filings and other public statements contained false
and misleading statements which resulted in damages to it, the
plaintiffs and the members of the purported class when they
purchased the Company's securities and in the ERISA lawsuit and
the stockholder derivative complaint, that there were breaches of
fiduciary duties and of ERISA disclosure requirements. The
stockholder derivative complaint also alleges waste of corporate
assets relating to the repurchase of the Company's shares in the
market and unjust enrichment as a result of securities sales by
certain officers and directors. The complaints all seek, among
other things, unspecified compensatory damages, costs and
expenses. As a result, it is not possible for the Company to
estimate a loss or range of losses for these lawsuits. The
stockholder derivative complaint also seeks amendments to the
Company's corporate governance procedures in addition to
unspecified compensatory damages from the individual defendants in
its favor.
The Company believes that the allegations in the lawsuits are
without merit, and Terex, its directors and the named executives
will continue to vigorously defend against them. The Company
believes that it has acted, and continues to act, in compliance
with federal securities laws and ERISA law with respect to these
matters. Accordingly, on November 19, 2010, the Company filed a
motion to dismiss the ERISA lawsuit and on January 18, 2011, the
Company filed a motion to dismiss the securities lawsuit. These
motions are currently in the briefing stage and pending before the
court. The plaintiff in the shareholder derivative lawsuit has
agreed with the Company to put this lawsuit on hold pending the
outcome of the motion to dismiss in connection with the securities
lawsuit.
No further updates were reported in the Company's latest SEC
filing.
TIM HORTONS: Franchisee Owners' Suit Seeks Class-Action Status
--------------------------------------------------------------
Christine Dobby, writing for Financial Post, reports that with the
weather suggesting Iced Caps over double doubles, a critical stage
in a lawsuit against Tim Hortons Inc. is about to warm up.
One preliminary event has fizzled. A motion over the
confidentiality of materials filed in the case -- a $1.95-billion
claim filed by two franchise owners from Burlington, Ont., in June
2008 -- was scheduled for Aug. 3 but is no longer proceeding, says
Lori Stolz of Adair Morse LLP, lawyers for the plaintiffs.
But the real action begins on Aug. 15 with a much-anticipated two-
week certification hearing. The plaintiffs will try to convince a
judge of the Ontario Superior Court of Justice in Toronto to
certify the case as a class action, while the defendant coffee and
doughnut company will argue the claim should be shut down through
a motion for summary judgment.
The plaintiff franchisees' chief squabble is with the company's
par-baking method, which requires store owners to buy frozen
doughnuts from a Brantford, Ont., plant that Tim Hortons co-owned
until last year. Starting around 2002, baked goods were shipped
across the country from the central location to be microwaved in
the store.
The plaintiffs argue the shift away from complete in-store baking
to this par-baking system -- known as the "Always Fresh
conversion" -- ate into their profit margins. The plaintiff
franchise owners also say the quick-serve restaurant's expanded
lunch offerings are not profitable.
The claims are based on alleged breach of contract and unjust
enrichment, among other things, and the dollar value sought is
intended to cover about 500 to 800 potential class members, owners
of about 2,400 Tim Hortons stores in Canada.
The company has said the claim is "frivolous and completely
without merit" but warned shareholders in its 2010 annual report,
"there can be no assurance that the outcome of the claim will be
favorable."
TREX CO: Continues to Defend Product Defects Class Suits
--------------------------------------------------------
Trex Company, Inc., continues to defend itself from purported
class action lawsuits over defects in the Company's products,
according to the Company's August 1, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2011.
On January 19, 2009, a purported class action case was commenced
against the Company in the Superior Court of California, Santa
Cruz County, by the lead law firm of Lieff, Cabraser, Heimann &
Bernstein, LLP and certain other law firms (the "Lieff Cabraser
Group") on behalf of Eric Ross and Bradley S. Hureth and similarly
situated plaintiffs. These plaintiffs generally allege certain
defects in the Company's products, and that the Company has failed
to provide adequate remedies for defective products. On February
13, 2009, the Company removed this case to the United States
District Court, Northern District of California. On January 21,
2009, a purported class action case was commenced against the
Company in the United States District Court, Western District of
Washington by the law firm of Hagens Berman Sobol Shapiro LLP (the
"Hagens Berman Firm") on behalf of Mark Okano and similarly
situated plaintiffs, generally alleging certain product defects in
the Company's products, and that the Company has failed to provide
adequate remedies for defective products. This case was
transferred by the Washington Court to the California Court as a
related case to the Lieff Cabraser Group's case.
On July 30, 2009, the U.S. District Court for the Northern
District of California preliminarily approved a settlement of the
claims of the lawsuit commenced by the Lieff Cabraser Group
involving surface flaking of the Company's product, and on
March 15, 2010, it granted final approval of the settlement. On
April 14, 2010, the Hagens Berman Firm filed a notice to appeal
the District Court's ruling to the United States Court of Appeals
for the Ninth Circuit. On July 9, 2010, the Hagens Berman Firm
dismissed their appeal, effectively making the settlement final.
On March 25, 2010, the Lieff Cabraser Group amended its complaint
to add claims relating to alleged defects in the Company's
products and alleged misrepresentations relating to mold growth.
The Hagens Berman firm has alleged similar claims in its original
complaint. In its Final Order approving the surface flaking
settlement, the District Court consolidated the two pending
actions relating to the mold claims, and appointed the Hagens
Berman Firm as lead counsel in this case. The Company believes
that these claims are without merit, and will vigorously defend
this lawsuit.
On December 15, 2010, a purported class action case was commenced
against the Company in the United States District Court, Western
District of Kentucky, by the lead law firm of Cohen & Malad, LLP
on behalf of Richard Levin and similarly situated plaintiffs, and
on June 13, 2011, a purported class action was commenced against
the Company in the Marion Circuit/Superior Court of Indiana by
Cohen & Malad on behalf of Ellen Kopetsky and similarly situated
plaintiffs. On June 28, 2011, the Company removed the Kopetsky
case to the United States District Court, Southern District of
Indiana. The plaintiffs in both of these purported class actions
generally allege certain defects in the Company's products and
alleged misrepresentations relating to mold growth. The Company
believes that these claims are without merit, and will vigorously
defend these lawsuits.
TROVER SOLUTIONS: Sued Over Monetary Settlements of NY Claims
-------------------------------------------------------------
Rebecca Meek-Horton, on behalf of herself and all others similarly
situated v. Trover Solutions, Inc. d/b/a Healthcare Recoveries,
Healthcare Recoveries, Inc., The Rawlings Company, LLC, First
Recovery Group, LLC, Aetna Life Insurance Company, Inc., Aetna,
Inc., American Progressive Life & Health Insurance Company of New
York, Inc., Amerigroup Corporation, Anthem Life & Disability
Insurance Co., Inc., Bankers Conseco Life Insurance Company, Inc.,
Coventry Healthcare, Inc., Cigna Corporation, EmblemHealth
Company, LLC, Elderplan, Inc., Empire HealthChoice Assurance,
Inc., Excellus Health Plan, Inc., d/b/a Excellus BlueCross
BlueShield Central New York, Excellus BlueCross BlueShield, Inc.,
Excellus Health Plan, Inc., d/b/a Univera Healthcare, Fidelis
SeniorCare, Inc., First United American Life Insurance Company,
Inc., Group Health Incorporated, Inc. d/b/a GHI, Hartford Life
Insurance Company, Inc., HealthFirst, Inc., HealthNow New York
Inc., HealthNow New York Inc., d/b/a BlueCross BlueShield of
Western New York and d/b/a BlueCross BlueShield of Northeastern
New York, HealthPlus, Inc., HIP of New York, Inc., Humana
Insurance Company of New York, Inc., Humana Health Plan, Inc.,
Mutual of Omaha Insurance Company, Corp., MVP Health Plan Inc.,
Oxford Health Plans (NY), Inc., State Farm Mutual Automobile
Insurance Company, Inc., Sterling Life Insurance Company, Inc.,
Transamerica Financial Life Insurance Company, Inc., Touchstone
Health HMO, Inc., UnitedHealthcare Insurance Company of New York
d/b/a AARP Health Care Options, United Healthcare Secure Horizons,
Inc., United Health Care Services, Inc. d/b/a Oxford Health
Insurance, Wellcare Health Plans, Inc., Wellpoint, Inc. d/b/a
Wellpoint Health Networks Group, John Does 1-10, intending to be
Collection Agents of Medicare Advantage Health Insurance
Companies, their names currently being unknown and John Does 11-
20, intending to be Medicare Advantage Health Insurance Companies,
their names currently being unknown, Case No. 108804/2011 (N.Y.
Sup Ct., August 1, 2011) is brought to recover funds from monetary
settlements of the class members' New York personal injury,
wrongful death and other similar cases and claims, and to
extinguish the liens asserted by defendants and their agents
against all persons covered by a Medicare Advantage health
insurance policy as against their pending New York Claims.
Ms. Meek-Horton alleges that certain of the defendants, as agent
for one or more Medicare Advantage health insurance company
defendants, have asserted liens against her and the other
plaintiffs, who have settled their New York claims and lawsuits,
by wrongfully alleging liens and rights of subrogation and rights
of reimbursement in violation of the New York State General
Obligations Law.
Ms. Meek-Horton is a resident of the county, city and state of New
York.
The defendants, except the Does, are domestic corporations duly
organized and existing under or foreign corporations duly
authorized to do business in the state of New York.
Does 1-10 are in the business of acting as agents and have
contracts with Medicare Advantage health insurance coverage
providers to collect alleged liens and rights of subrogation and
reimbursement from settling parties in New York. Does 11-20 are
in the business of providing Medicare Advantage health insurance
coverage in New York.
The Plaintiff is represented by:
Howard Schatz, Esq.
SILBOWITZ, GARAFOLA, SILBOWITZ, SCHATZ & FREDERICK, LLP
25 West 43rd Street, Suite 711
New York, NY 10036
Telephone: (212) 354-6800
UNITED BANKSHARES: Continues to Defend Overdraft Practices Suits
----------------------------------------------------------------
United Bankshares Inc. continues to defend itself against class
lawsuits relating to overdraft practices, according to the
Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
In April 2011, United Bankshares, Inc. and United Bank, Inc. were
named as defendants in two putative class actions. In the first
putative class action, the plaintiffs seek to represent a national
class of United Bank customers allegedly harmed by United Bank's
overdraft practices. In the second putative class action, the
plaintiff seeks to represent a class of West Virginia residents
allegedly harmed by United Bank's overdraft practices.
These lawsuits are substantially similar to class action lawsuits
being filed against financial institutions nationwide. At this
stage of the proceedings, it is too early to determine if these
matters would be reasonably expected to have a material adverse
effect on United's financial condition. United believes it has
meritorious defenses to the claims asserted in both proceedings.
UNITEDHEALTH GROUP: Class Action Lawsuits in Florida Still Pending
------------------------------------------------------------------
UnitedHealth Group Incorporated continues to defend itself from
class action lawsuits filed by healthcare providers in Florida,
according to the Company's August 2, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter period
ended June 30, 2011.
Beginning in 1999, a series of class action lawsuits were filed
against the Company by health care providers alleging various
claims relating to the Company's reimbursement practices,
including alleged violations of the Racketeer Influenced Corrupt
Organization Act (RICO) and state prompt payment laws and breach
of contract claims. Many of these lawsuits were consolidated in a
multi-district litigation in the United States District Court for
the Southern District Court of Florida (MDL). In 2006, the trial
court dismissed all of the claims against the Company in the lead
MDL lawsuit, and the Eleventh Circuit Court of Appeals later
affirmed that dismissal. Seven related class action lawsuits that
were stayed during the litigation of the lead MDL lawsuit (tag-
along suits) remain pending before the District Court, and the
Company is a defendant in one other related tag-along suit that
was referred to arbitration. The Company is vigorously defending
against the claims in these cases. The Company cannot reasonably
estimate the range of loss, if any, that may result from these
matters given the procedural status of the cases, the potential
effect of prior rulings in related cases, the plaintiffs' failure
to provide any evidence-based damages analyses, and the
indeterminate number of claims and parties involved. In fact, no
formal demands have been made in any of the remaining suits and
the plaintiffs have not provided an estimate of alleged damages.
However, the Company does not believe that the remaining MDL
proceedings will have a material adverse effect on the Company.
UnitedHealth Group is a diversified health and well-being company,
whose focus is on improving the overall health and well-being of
the people and communities it serves and enhancing the performance
of the health system.
UNITEDHEALTH GROUP: Continues to Defend Ingenix-Related Suits
-------------------------------------------------------------
UnitedHealth Group Incorporated continues to defend itself from
putative class action lawsuits relating to its use of a database
maintained by Ingenix, Inc., according to the Company's August 2,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2011.
In 2000, a group of plaintiffs including the American Medical
Association filed a lawsuit against the Company asserting a
variety of claims challenging the Company's determination of
reimbursement amounts for non-network health care services based
on the Company's use of a database previously maintained by
Ingenix, Inc. (now known as OptumInsight). The parties entered
into a settlement agreement in 2009 and the class action lawsuit,
along with a related industry-wide investigation by the New York
Attorney General, is now resolved. The Company remains a party to
a number of other lawsuits, including putative class actions and
multidistrict litigation, brought on behalf of members of other
health insurance companies, including Aetna, WellPoint and CIGNA,
challenging those companies' determinations of out-of-network
reimbursement amounts based on their use of the same database.
Those suits allege, among other things, that the database licensed
to these companies by Ingenix was flawed and that Ingenix
conspired with these companies to underpay their members' claims
and seek unspecified damages and treble damages, injunctive and
declaratory relief, interest, costs and attorneys fees. The
Company is vigorously defending these suits. The Company cannot
reasonably estimate the range of loss, if any, that may result
from these matters due to the procedural status of the cases,
motions to dismiss that are pending in all of the cases, the
absence of class certification in any of the cases, the lack of a
formal demand on the Company by the plaintiffs, and the
involvement of other insurance companies as defendants.
UnitedHealth Group is a diversified health and well-being company,
whose focus is on improving the overall health and well-being of
the people and communities it serves and enhancing the performance
of the health system.
WESTERN UNION: Motion to Dismiss in Colorado Suits Still Pending
----------------------------------------------------------------
The Western Union Company's motion to dismiss the breach of
fiduciary duty and declaratory relief claims in the class action
lawsuits in Colorado remains pending, according to the Company's
August 2, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
The Company and one of its subsidiaries are defendants in two
purported class action lawsuits: James P. Tennille v. The Western
Union Company and Robert P. Smet v. The Western Union Company,
both of which are pending in the United States District Court for
the District of Colorado. The original complaints asserted claims
for violation of various consumer protection laws, unjust
enrichment, conversion and declaratory relief, based on
allegations that the Company waits too long to inform consumers if
their money transfers are not redeemed by the recipients and that
the Company uses the unredeemed funds to generate income until the
funds are escheated to state governments. The Tennille complaint
was served on the Company on April 27, 2009. The Smet complaint
was served on the Company on April 6, 2010. On September 21,
2009, the Court granted the Company's motion to dismiss the
Tennille complaint and gave the plaintiff leave to file an amended
complaint. On October 21, 2009, Tennille filed an amended
complaint. The Company moved to dismiss the Tennille amended
complaint and the Smet complaint. On November 8, 2010, the Court
denied Western Union's motion to dismiss as to the plaintiffs'
unjust enrichment and conversion claims.
On February 4, 2011, the Court dismissed plaintiffs' consumer
protection claims. On March 11, 2011, the plaintiffs filed an
amended complaint that adds a claim for breach of fiduciary duty,
various elements to its declaratory relief claim and Western Union
Financial Services, Inc. as a defendant. On April 25, 2011, the
Company and Western Union Financial Services, Inc. filed a motion
to dismiss the breach of fiduciary duty and declaratory relief
claims. Western Union Financial Services, Inc., has also moved to
compel arbitration of the plaintiffs' claims. The plaintiffs have
not sought and the Court has not granted class certification.
The Company and Western Union Financial Services, Inc., intend to
vigorously defend themselves against both lawsuits. However, due
to the preliminary stages of these lawsuits, the fact the
plaintiffs have not quantified their damage demands, and the
uncertainty as to whether they will ever be certified as class
actions, the potential outcome cannot be determined.
WESTINGHOUSE SOLAR: Agrees to Settle Securities Suit in Calif.
--------------------------------------------------------------
Westinghouse Solar, Inc., has reached an agreement in principle to
settle a securities lawsuit pending in California, according to
the Company's August 2, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2011.
On May 18, 2009, the Company and certain of its officers were
named in a class action complaint in the United States District
Court Northern District of California San Jose Division alleging
violations of the federal securities laws. The lawsuit alleges
various omissions and misrepresentations during the period of
December 26, 2007, to March 13, 2008, regarding, among other
things, the Company's backlog reporting and bank line of credit.
On October 22, 2010, plaintiffs moved the court to certify
themselves as a class, a procedure required in order for
plaintiffs to move forward with their case as a class action. On
March 10, 2011, the District Court granted plaintiffs' motion for
class certification.
On July 12, 2011, the parties reached an agreement in principle to
settle the class and derivative actions. The proposed settlement
would result in a release of all claims, implementation of certain
corporate governance measures, and a cash payment to be made
exclusively from the proceeds of directors and officers liability
insurance. The proposed settlement will not become final until
several additional events occur, including finalization and
documentation of the settlement terms, notice to the class
members, and court approval.
WISCONSIN ENERGY: Continues to Defend Class Suit Over Pension Plan
------------------------------------------------------------------
Wisconsin Energy Corporation continues to defend itself against a
class action lawsuit related to the Company's Cash Balance Pension
Plan, according to the Company's August, 2011, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2010.
In June 2009, a lawsuit was filed by Alan M. Downes, a former
employee, against Wisconsin Energy Corporation' Cash Balance
Pension Plan in the U.S. District Court for the Eastern District
of Wisconsin. Counsel representing the plaintiff has sought class
certification for other similarly situated plaintiffs. The
complaint alleges that Plan participants who received a lump sum
distribution under the Plan prior to their normal retirement age
did not receive the full benefit to which they were entitled in
violation of ERISA and are owed additional benefits, because the
Plan failed to apply the correct interest crediting rate to
project the cash balance account to their normal retirement age.
In September 2010, the plaintiff filed a First Amended Class
Action Complaint alleging additional claims under ERISA and adding
Wisconsin Energy as a defendant. The plaintiff has not specified
the amount of relief he is seeking.
In March 2011, after the matter was addressed by the Plan's
Employee Benefits Committee and following the Committee's review
and analysis of the facts and evolving state of the law, the Plan
acknowledged in an amended answer that it had used an incorrect
interest crediting rate in computing lump sum payments prior to
normal retirement age. The Committee determined the interest
crediting rates that should be applied to address the interest
crediting rate calculation and determined that the benefits for
certain eligible participants should be recalculated. The
plaintiff is opposing the Committee's actions and the Court has
not yet decided what deference, if any, to give to the Committee's
decision. Therefore, the Company is currently unable to predict
the final outcome or impact of this litigation. An adverse outcome
of this lawsuit could have a material adverse effect on Plan
funding and expense and the Company's results of operations.
XEROX CORP: Consolidated Securities Suit Pending in Connecticut
---------------------------------------------------------------
A consolidated securities lawsuit filed against Xerox Corporation
remains pending in Connecticut, according to the Company's
August 1, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2011.
A consolidated securities law action (consisting of 17 cases) is
pending in the United States District Court for the District of
Connecticut. Defendants are the Company, Barry Romeril, Paul
Allaire and G. Richard Thoman. The consolidated action is a class
action on behalf of all persons and entities who purchased Xerox
Corporation common stock during the period October 22, 1998,
through October 7, 1999, inclusive ("Class Period") and who
suffered a loss as a result of misrepresentations or omissions by
Defendants as alleged by Plaintiffs (the "Class"). The Class
alleges that in violation of Section 10(b) and/or 20(a) of the
Securities Exchange Act of 1934, as amended ("1934 Act"), and SEC
Rule 10b-5 thereunder, each of the defendants is liable as a
participant in a fraudulent scheme and course of business that
operated as a fraud or deceit on purchasers of the Company's
common stock during the Class Period by disseminating materially
false and misleading statements and/or concealing material facts
relating to the defendants' alleged failure to disclose the
material negative impact that the April 1998 restructuring had on
the Company's operations and revenues. The complaint further
alleges that the alleged scheme: (i) deceived the investing public
regarding the economic capabilities, sales proficiencies, growth,
operations and the intrinsic value of the Company's common stock;
(ii) allowed several corporate insiders, such as the named
individual defendants, to sell shares of privately held common
stock of the Company while in possession of materially adverse,
non-public information; and (iii) caused the individual plaintiffs
and the other members of the purported class to purchase common
stock of the Company at inflated prices. The complaint seeks
unspecified compensatory damages in favor of the plaintiffs and
the other members of the purported class against all defendants,
jointly and severally, for all damages sustained as a result of
defendants' alleged wrongdoing, including interest thereon,
together with reasonable costs and expenses incurred in the
action, including counsel fees and expert fees. In 2001, the
Court denied the defendants' motion for dismissal of the
complaint. The plaintiffs' motion for class certification was
denied by the Court in 2006, without prejudice to refiling. In
February 2007, the Court granted the motion of the International
Brotherhood of Electrical Workers Welfare Fund of Local Union No.
164, Robert W. Roten, Robert Agius ("Agius") and Georgia Stanley
to appoint them as additional lead plaintiffs.
In July 2007, the Court denied plaintiffs' renewed motion for
class certification, without prejudice to renewal after the Court
holds a pre-filing conference to identify factual disputes the
Court will be required to resolve in ruling on the motion. After
that conference and Agius' withdrawal as lead plaintiff and
proposed class representative, in February 2008 plaintiffs filed a
second renewed motion for class certification. In April 2008,
defendants filed their response and motion to disqualify Milberg
LLP as a lead counsel. On September 30, 2008, the Court entered
an order certifying the class and denying the appointment of
Milberg LLP as class counsel. Subsequently, on April 9, 2009, the
Court denied defendants' motion to disqualify Milberg LLP. On
November 6, 2008, the defendants filed a motion for summary
judgment. Briefing with respect to the motion is complete. The
Court has not yet rendered a decision. The parties also filed
motions to exclude the testimony of certain expert witnesses. On
April 22, 2009, the Court denied plaintiffs' motions to exclude
the testimony of two of defendants' expert witnesses. On
September 30, 2010, the Court denied plaintiffs' motion to exclude
the testimony of another of defendants' expert witnesses. The
Court also granted defendants' motion to exclude the testimony of
one of plaintiffs' expert witnesses, and granted in part and
denied in part defendants' motion to exclude the testimony of
plaintiffs' two remaining expert witnesses.
The Company says that it and the individual defendants deny any
wrongdoing and are vigorously defending the action. At this time,
the Company does not believe it is reasonably possible that it
will incur additional material losses in excess of the amount it
has already accrued for this matter. In the course of litigation,
the Company periodically engages in discussions with plaintiffs'
counsel for possible resolution of this matter. Should
developments cause a change in the Company's determination as to
an unfavorable outcome, or result in a final adverse judgment or a
settlement for a significant amount, there could be a material
adverse effect on its results of operations, cash flows and
financial position in the period in which such change in
determination, judgment or settlement occurs.
No further updates were reported in the Company's latest SEC
filing.
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S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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.
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