/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/120126.mbx C L A S S A C T I O N R E P O R T E R Thursday, January 26, 2012, Vol. 14, No. 18 Headlines APPLE INC: Faces Antitrust Class Action in California CACHE CACHE: Faces Class Action in Colorado Over Tip Pool CALIFORNIA INNOVATIONS: Recalls 248,000 Expandable Lunch Boxes CALIFORNIA INNOVATIONS: Recalls 55T Travelin' Chef Food Carriers CHICO'S FAS: Continues to Defend "Haefner" Suit in California CLOROX CO: Fresh Step Advertisement Deceives Consumers, Suit Says COSTA CRUISES: Criminal Probe Set to Expand After Class Action DIOCESE OF COVINGTON: Suits v. Class Action Lawyers Dismissed FOCUS MEDIA: Faces Securities Class Action Suit in New York GOOGLE INC: 9th Cir. Upholds Approval of CLRB Settlement GOV'T OF CANADA: Judge Certifies Class Action Over Charity Tax HEWLETT-PACKARD: Fined $425,000 Over Lithium-Ion Battery Packs HSBC HOLDINGS: Terminates Thema Fund Class Action Settlement INVESTMENT RETRIEVERS: Accused of Illegal Debt Collection in Ill. LADENBURG THALMANN: Unit Paid All Dues in Consolidated Suit Deal LOUISIANA CITIZEN: Court Denies Bid for Class Action Rehearing MOSTYN LAW FIRM: Paralegals' Class Action Gets Conditional Okay STATE OF INDIANA: Witnesses' State Fair Class Action Dropped VERIZON COMMS: Faces Class Action Over TV Protection Plan VENOCO INC: Being Sold for Too Little, Del. Suit Claims WESTWOOD COLLEGE: Sued Over False Claims on Accreditation YOUNG CHANG: App. Ct. Affirms Ruling Denying Class Certification YRC WORLDWIDE: Court Set to Decide on Class Action Settlement ********* APPLE INC: Faces Antitrust Class Action in California ----------------------------------------------------- Matt Reynolds at Courthouse News Service reports that Apple bills iPhone purchasers for voice and data services even after they cancel it, and stifles competition and increases prices for software apps by charging developers an annual "application" fee, consumers say in a federal antitrust class action. Lead plaintiff Eric Terrell accuses Apple of "unlawful anticompetitive activities," and claims that consumers did not contractually consent to Apple and AT&T's 5-year exclusivity agreement. AT&T Mobility LLC, referred to in the complaint as ATTM, is not a party to the lawsuit. "Apple launched its iPhone on or about June 29, 2007," the complaint states. "Prior to launch, Apple entered into a secret five-year contract with ATTM that established ATTM as the exclusive provider of cell phone voice and data services for iPhone customers through some time in 2012 ('Exclusivity Agreement'). As part of the contract, Apple shared in ATTM's revenues and profits with respect to the first generation of iPhones launched. The plaintiffs and other class members who purchased iPhones did not agree to use ATTM for five years. Apple's undisclosed five-year exclusivity agreement with ATTM, however, effectively locked iPhone users into using ATTM for five years, contrary to those users' knowledge, wishes and expectations. "To enforce ATTM's exclusivity, Apple, among other things, programmed and installed software locks on each iPhone it sold that prevented the purchaser from switching to another carrier that competed with ATTM in the cell phone voice and data services industry. Under an exemption to the Digital Millennium Copyright Act of 1998, 17 U.S.C. Sec. 1201, el seq. (2008) (the 'DMCA'), cell phone consumers have an absolute legal right to modify their phones to use the network carrier of choice. Apple prevented iPhone customers from exercising their legal right by locking the iPhones and refusing to give customers the software codes necessary to unlock them." The complaint adds: "Prior to plaintiffs' purchases of their iPhones and voice and data service, Apple had not disclosed-much less obtained plaintiffs' contractual consent to-the fact that (a) plaintiffs' iPhones were locked to only work with ATTM SIM cards, or (b) that the unlock codes would be provided to them on request. "On information and belief, ATTM provides unlock codes for cell phones other than the iPhone if requested by a customer. . . . "In the United States, as a general rule, only GSM [Global System for Mobile Communications] phones use SIM cards. The removable SIM card allows phones to be instantly activated, interchanged, swapped out and upgraded, all without carrier intervention. The SIM card itself is tied to the network rather than the actual phone. Phones that are SIM card-enabled generally can be used with any GSM carrier." Mr. Terrell says mobile carries customarily allow customers to unlock SIM cards to avoid roaming fees during international travel. He says Apple is an exception, enforcing its exclusivity agreement with AT&T by installing locks on SIM cards and refusing to disclose unlock codes so customers can change their cards or switch carriers. Mr. Terrell says Apple also uses program locks to prevent customers from using third-party Apps, unless the developers of those Apps paid a fee through iTunes, or handed over 30 percent of their revenue. "In March 2008, Apple released a 'software development kit' ('SDK') for the stated purpose of enabling independent software developers to design applications for use on the iPhone," the complaint states. "For an annual fee of $99, the SDK allows developers to submit applications to be distributed through Apple's application market, the 'iTunes App Store.' If the application is not made available for free in the App Store, Apple collects 30 percent of the sale price for each application and the developer receiving the remaining 70 percent. On information and belief, throughout the class period, Apple refused to 'approve' any application by a developer who did not pay the annual fee, or agree to Apple's apportionment scheme. Apple also unlawfully discouraged iPhone customers from downloading competing applications software (hereafter 'Third Part Apps') by telling customers it would void and refuse to honor the iPhone warranty of any customer who downloaded third party apps. "iPhone consumers were not provided a means to download third party apps that were not approved by Apple for sale on the App Store." Savvy users cracked locking codes using software available on the Internet, Mr. Terrell says. Apple claimed its locks helped prevent fraud. The Librarian of Congress announced the first 3-year exemption to the DMCA in late 2006, allowing users to circumvent locking codes, Mr. Terrell says. He says that exemption was extended in 2009, and put into effect in July 2010. "Because Apple was unable to enforce its SIM card program locks through legal means, it engaged in a scheme to enforce them unlawfully as to the iPhone," the complaint states. Mr. Terrell says that in early 2007, Apple announced its exclusive agreement with AT&T, roughly 1 month after the Librarian of Congress made its first ruling. "Through these actions, Apple has unlawfully stifled competition, reduced output and consumer choice, and artificially increased prices in the aftermarkets for iPhone voice and data services for iPhone software applications," the complaint states. Mr. Terrell says that even though AT&T and Apple no longer share revenues, they still enforce the terms of the agreement. Mr. Terrell, an Oakland attorney, seeks damages and equitable relief for unlawful monopolization of the applications aftermarket, and conspiracy to monopolize the iPhone voice and data services aftermarket. Mr. Terrell's law firm did not respond to a request for comment. Apple is the only defendant. It did not respond to a request for an interview. A copy of the Complaint in Terrell, et al. v. Apple Inc., Case No. 12-cv-00259 (N.D. Calif.), is available at: http://www.courthousenews.com/2012/01/23/AppleApps.pdf The Plaintiffs are represented by: Reginald Terrell, Esq. THE TERRELL LAW GROUP P.O. Box 13315 Oakland, CA 94661 Telephone: (510) 237-9700 E-mail: reggie2@aol.com CACHE CACHE: Faces Class Action in Colorado Over Tip Pool --------------------------------------------------------- Rick Carroll, writing for The Aspen Times, reports that a Fort Collins law firm has taken steps to launch a class-action lawsuit against an Aspen restaurant accused of running an illegal tip pool for its employees. The Law Offices of Brian Gonzalez PLLC, on behalf of Sandro Torres, filed a complaint on Jan. 20 in the U.S. District Court of Denver against Cache Cache restaurant and its owners, Jodi Larner and Chris Lanter. The federal lawsuit aims for class-action certification from the court and seeks current and former Cache Cache employees "whose tips were diverted illegally" to participate in the complaint. For now, Mr. Torres is the only plaintiff in the suit, which says he worked at Cache Cache as a back waiter and food runner from February 2004 to March 2008 and from January 2011 to April. Under Cache Cache's employ, Mr. Torres made less than minimum wage -- $4 to $4.25. Paying less than minimum wage to regularly tipped employees is a standard practice in the restaurant industry. But for restaurants to take a tip credit against the minimum wage, they must adhere to state labor laws, which allow for tip pools. By Colorado law, the suit alleges, the only employees who can collect from a tip pool are "front of the house" workers such as servers and hostesses. But at Cache Cache, such employees as chefs, dishwashers and food preparers -- who were not regularly tipped -- also participated in the tip pool, the suit says. By doing so, Cache Cache violated the Colorado Wage Claim Act and the federal Fair Labor Standards Act, the suit alleges. "The misuse of tips and participating of non-tipped employees invalidates the Cache Cache tip pool and nullifies (Cache Cache's) entitlement to claim a tip credit against the minimum wage," the suit says. "Defendants are liable for, among other things, paying a sub-minimum wage to current and former employees and for all tips diverted improperly." The suit also asks that Torres and other "similarly situated plaintiffs" be reimbursed for all tip credits taken against their hourly wages. Mr. Gonzalez, who filed the suit, did not return a telephone message on Jan. 20 seeking comment for this story. Ms. Larner and Mr. Lanter also did not return a message left on Jan. 20 at the restaurant. CALIFORNIA INNOVATIONS: Recalls 248,000 Expandable Lunch Boxes -------------------------------------------------------------- The U.S. Consumer Product Safety Commission, in cooperation with California Innovations Inc., of Toronto, Canada, announced a voluntary recall of about 248,000 units of Expandable Insulated Lunch Box with Freezer Gel Pack. Consumers should stop using recalled products immediately unless otherwise instructed. It is illegal to resell or attempt to resell a recalled consumer product. Gel that contains diethylene glycol and ethylene glycol can leak out of damaged freezer gel packs, posing a poisoning hazard if ingested by children or adults. The firm has received two separate reports of a dog chewing and ingesting gel from the gel pack. One dog reportedly died from ingestion of the gel. The other was reported to have received treatment and has recovered. The recalled product is a Ci Sport three-piece, expandable, insulated lunch box set, which includes the lunch box, aluminum bottle and the freezer gel pack. The lunch box of the recalled set has the code "1-61731-99-57" printed on one of the two white labels that are sewn under the white fastener inside the main compartment. The lunch box is 8 inches wide, 5 inches deep and 10.25 inches high. It is made of vinyl, polyester nylon and crushed nylon and has a logo with the words "Ci Sport" attached to the upper left corner. The lunch box has a carrying handle on the top and a mesh carrying pouch for the aluminum bottle on the side. The aluminum bottle measures 2.75 inches in diameter and 7.5 inches tall. The gel pack is a 6-inch by 4-inch transparent plastic pouch filled with blue liquid gel. The words "Cryofreeze" and "Ice Pack/Hot Pack" are printed in white letters on the front of the pouch. The lunch box was available in four colors: navy blue, red, black and denim blue. Picture of the recalled products is available at: http://www.cpsc.gov/cpscpub/prerel/prhtml12/12089.html The recalled products were manufactured in China and sold at Costco Wholesale Clubs, Leon Korol and Cost U Less stores between May 2007 and September 2008 for about $10. Consumers should immediately stop using the gel packs and dispose of them according to federal, state and/or local regulations. It is recommended that consumers contact their local waste disposal authority for instructions. Consumers may return the lunch box set to Costco for a full refund or may receive a $5 cash refund for the gel pack only by contacting California Innovations. For additional information, call California Innovations at (800) 722- 2545 between 9:00 a.m. and 5:00 p.m. Eastern Time Monday through Friday, e-mail ci-recall@ca-innovations.com or visit the firm's Web site at http://www.californiainnovations.com/ CALIFORNIA INNOVATIONS: Recalls 55T Travelin' Chef Food Carriers ---------------------------------------------------------------- The U.S. Consumer Product Safety Commission, in cooperation with California Innovations Inc., of Toronto, Canada, announced a voluntary recall of about 55,000 units of Travelin' Chef Expandable Thermal Food Carrier. Consumers should stop using recalled products immediately unless otherwise instructed. It is illegal to resell or attempt to resell a recalled consumer product. Gel that contains diethylene glycol and ethylene glycol can leak out of damaged freezer gel packs, posing a poisoning hazard if ingested by children or adults. No incidents or injuries have been reported. The recalled product is a four-piece food carrier set, which includes a light blue thermal carrier with black carrying handles, a medium plastic food container, a large plastic food container and a freezer gel pack. The recalled thermal carrier has the code "1-38018-69-07" printed on a white label on the inside of the main compartment on the left hand side. The thermal carrier is 18 inches wide, 10.5 inches deep and 4.7 inches high and made of vinyl and polyester. The medium food container measures 9.75 inches by 6.25 inches by 3.5 inches. The large food container measures 11.75 inches by 8.75 inches by 3.5 inches. The gel pack is an 8.5-inch by 8-inch, opaque blue plastic pouch filled with liquid gel. The words "Cryofreeze" and "Ice Pack/Hot Pack" are printed in white letters on the front of the pouch. A picture of the recalled products is available at: http://www.cpsc.gov/cpscpub/prerel/prhtml12/12090.html The recalled products were manufactured in China and sold at Walmart between August 2008 to December 2011 for about $22. Consumers should immediately stop using the gel packs and dispose of them according to federal, state and/or local regulations. It is recommended that consumers contact their local waste disposal authority for instructions. Consumers may return the gel pack to Walmart for a refund of $6 or contact California Innovations customer service at (800) 722-2545 for the same refund. For additional information, call California Innovations at (800) 722- 2545 between 9:00 a.m. and 5:00 p.m. Eastern Time Monday through Friday or visit the firm's Web site at http://www.californiainnovations.com/ CHICO'S FAS: Continues to Defend "Haefner" Suit in California ------------------------------------------------------------- Chico's FAS, Inc. continues to defend a putative class action lawsuit commenced by Michele L. Massey Haefner in California, according to the Company's January 20, 2012, Form 8-K/A filing with the U.S. Securities and Exchange Commission. The Company was named as defendant in a putative class action filed in June 2008 in the Superior Court for the State of California, County of San Diego, Michele L. Massey Haefner v. Chico's FAS, Inc. The Complaint alleges that the Company, in violation of California law, requested or required customers to provide personal information in conjunction with credit card transactions. The Company filed an answer denying the material allegations of the Complaint. The Company believes that the case is wholly without merit and, thus, does not believe that the case should have any material adverse effect on the Company's financial condition or results of operations. CLOROX CO: Fresh Step Advertisement Deceives Consumers, Suit Says ----------------------------------------------------------------- Kristin Luszcz, Individually and on behalf of all others similarly situated v. The Clorox Company, Case No. 4:12-cv-00356 (N.D. Calif., January 23, 2012) alleges that Clorox's marketing and advertising campaign messages that its carbon-containing Fresh Step Cat Litter is more effective at eliminating odors than other cat litters, and that cats "choose" Fresh Step over other cat litters are false, misleading and deceptive. Clorox boasts about the superiority of odor-eliminating capabilities of carbon throughout its advertisement, however, Clorox has no evidence to support its superiority claims, Ms. Luszcz contends. She tells the Court that during the class period, she was exposed to and saw Clorox's marketing and advertising claims, purchased Fresh Step based on those claims, and suffered injury because of the Company's unfair and deceptive trade practices. She insists that she did not receive the benefit of her bargain in each purchase of Fresh Step. Ms. Luszcz is a resident of New York. Clorox, a Delaware corporation, is headquartered in Oakland, California. Clorox manufactures and markets consumer and institutional products. The Plaintiff is represented by: Joseph J. Tabacco, Jr., Esq. Christopher T. Heffelfinger, Esq. Anthony D. Phillips, Esq. BERMAN DEVALERIO One California Street, Suite 900 San Francisco, CA 94111 Telephone: (415) 433-3200 Facsimile: (415) 433-6382 E-mail: jtabacco@bermandevalerio.com cheffelfinger@bermandevalerio.com aphi1lips@bermandevalerio.com - and - Hollis Salzman, Esq. Kellie Lerner, Esq. Gregory Asciolla, Esq. LABATON SUCHAROW LLP 140 Broadway New York, NY 10005 Telephone: (212) 907-0700 Facsimile: (212) 818-0477 E-mail: hsalzman@labaton.com klerner@labaton.com gasciolla@labaton.com COSTA CRUISES: Criminal Probe Set to Expand After Class Action -------------------------------------------------------------- Antonella Cinelli and Gabriele Pileri, writing for National Post, reports that a criminal probe into the Costa Concordia's doomed voyage, which ended with at least 15 dead and the cruise ship lying off the Italian coast, may be widened, a lawyer for the captain said on Jan. 23. The toll includes the bodies of two women, their nationalities so far unknown, found by divers on Jan. 23. Captain Francesco Schettino is accused of causing the accident and is under investigation for multiple manslaughter and abandoning the EUR450 million (US$590 million) ship before it was evacuated. Mr. Schettino's lawyer Bruno Leporatti said in a statement that evidence from his client about phone calls with the ship's owners, Costa Cruises, at the time of the accident could lead to the investigation being widened. He said the calls with Costa's marine operation director had "opened further channels for investigation that could reasonably lead to an increase in the number of those under investigation." Third parties "could have at least contributed to creating the tragic event," Mr. Leporatti said. According to leaked transcripts from the investigation, Mr. Schettino has admitted steering too close to shore. Mr. Leporatti has said that while Mr. Schettino is willing to accept his share of responsibility, other factors were involved in the accident. Investigators say he brought the ship to within 150 meters of the shore, apparently while performing a "salute" to the island. Mr. Schettino says this maneuver was common but the company says it should not be performed so close to the shore. Costa Cruises, a unit of Carnival Corp, the world's largest cruise ship operator, has suspended Mr. Schettino and declared itself an injured party in the case. It has said "unfortunate human error" by Mr. Schettino caused the disaster. Class-Action A U.S. lawyer said on Jan. 23 the Costa Concordia had earlier cruised recklessly close to other islands to impress passengers. Mitchell Proner of New York law firm Proner & Proner, which is planning to file a class-action suit in Miami on Jan. 18 on behalf of passengers in the disaster, said the ship owner would be a main target of the lawsuit. "At this point we're exploring numerous defendants; certainly you've got (ship owner) Costa Cruise lines," Mr. Proner told AFP. "While they might be trying to indicate that the incident is the fault of this one rogue captain, we know that they've had some precedents going close to these islands along the Italian coast," he said. Costa Concordia Italian cruise ship sinking: Can it be salvaged? He said the same ship had earlier cruised dangerously close to the island of Procida in the Gulf of Naples. "Procida set up mortars and saluted and the Concordia responded by blasting their sirens. So this is something that they have done in the past as a way of generating publicity and advertising for their company," he said. "It's thrill-seeking for the passengers, but it's reckless." Proner & Proner is teaming up with Italian consumer rights' association Codacons and another New York law firm, Napoli Bern Ripka Shkolnik, to lead the lawsuit on behalf of victims in the Jan. 13 shipwreck, which occurred after the vessel moved too close to the shore of the island of Giglio. Mr. Proner said they would likely file the suit on behalf of all victims on Jan. 18 in Miami, home base of Carnival, the giant U.S. cruise ship operator which owns Costa Cruise lines. They would seek at least US$160,000 for each of the victims. "If they sustained injury it can be a multiple of that number. If they have a disability as a result of the incident and certainly in the cases of fatalities, we're expecting in excess of a million euros per individual." He said they would also be examining whether the equipment on board the vessel designed to prevent such accidents had failed or were disengaged. Notification The vice president of Carnival Corp, Howard Frank, arrived in Italy on Jan. 22 to help oversee the situation, according to a source close to the company. Frank and Pier Luigi Foschi, chairman and chief executive of Costa Cruises, met some of families of the victims of the tragedy on Giglio island on Jan. 22, the source said. Costa Cruises has not received any notification that it is being investigated, according to a company spokesman. The company will be forthright with investigators and has full faith in the magistrature, he added. According to transcripts of Mr. Schettino's questioning by prosecutors leaked to Italian media, the captain said that immediately after hitting the rock he sent two of his officers to the engine room to check on the state of the vessel. As soon as he realized the scale of the damage, he called Roberto Ferrarini, marine operations director for Costa Cruises. "I told him: 'I've got myself into a mess, there was contact with the seabed. I am telling you the truth, we passed under Giglio and there was an impact'," Mr. Schettino said. "I can't remember how many times I called him in the following hour and 15 minutes. In any case, I am certain that I informed Ferrarini about everything in real time." Separately, Mr. Leporatti said that Mr. Schettino tested negative in hair and urine tests for drug use, but was not tested for alcohol on the night of the accident. If the probe is broadened, it will reduce the glare of the spotlight on Mr. Schettino, who has so far been assigned almost exclusive responsibility for the disaster. His first officer Ciro Ambrosio is also under investigation. A judge has said Mr. Schettino showed "incredible carelessness" and a "total inability to manage the successive phases of the emergency," according to documents from a hearing. Search Continues Search operations were still under way for nearly 20 bodies missing. Navy divers blasted underwater holes in the hull of the ship to provide additional points of access. Debris floated out and was gathered by coastguard boats. An Italian navy ship, the Galatea, which is equipped with a sophisticated undersea radar system, has been sent to the area to help search for bodies. Reports on Jan. 22 of the possible presence of unregistered passengers, including one Hungarian woman, raised questions about the exact number of people missing. Costa Cruises on Jan. 23 denied the presence of stowaways. The Hungarian foreign ministry said it had no news that any of its nationals had been secretly on board, according to Italy's civil protection agency. Franco Gabrielli, head of Italy's civil protection authority, said the ship was stable and there appeared to be no immediate risk that it could slide off the rock outcrop where it is caught and slip into deeper waters. He said search operations could continue, and operations to pump some 2,400 tons of fuel from the vessel could begin while the search for bodies was still under way. On Jan. 17, a platform boat for the fuel recovery team will be positioned near the Costa Concordia and preparatory dives will be made, according to SMIT, the Dutch company hired to salvage the fuel. Giglio's economy depends on tourists seeking clean beaches and clear water for snorkeling and scuba diving. Its drinking water, too, is drawn from the sea and desalinated. UNESCO Decree United Nations cultural body UNESCO urged the Italian government on Jan. 23 to restrict the access of cruise ships to World Heritage Site Venice in the wake of the Costa Concordia cruise ship disaster. In a statement, Paris-based UNESCO said it had called on the Italian government "to restrict access of large ships to culturally and ecologically important areas, particularly Venice and its lagoon which are visited by some 300 large cruise ships a year." It said cruise liner traffic in Venice "is particularly damaging because of the fragile structure of the city. "The ships cause water tides that erode the foundations of buildings. They contribute to pollution and impact the cityscape as they dwarf monuments in the heart of the city," UNESCO said. Amid efforts to eventually pump out hundreds of tons of fuel remaining in the ship, environmentalists have warned of an ecological catastrophe in Europe's biggest marine sanctuary. Discounts On Jan. 23, it emerged that the ship's owner, Costa Cruises, a division of Carnival, the largest cruise ship operator in the world, is offering survivors a 30% discount off future cruises. The move is the first obvious effort to limit the corporate damage done by the shipwreck, the result of a failed nighttime sail-by in which the ship was gashed by a rock, then beached to facilitate rescue, only to topple over on the rocks when the tide went out. But with people still missing, and the rescue operation complicated by the question of unregistered passengers, the offer was criticized as "insulting," by one British survivor. The Daily Telegraph also reported that the Florida-based company had been telephoning survivors "asking if they are suffering nightmares or sleepless nights," which are the hallmark symptoms of post-traumatic stress disorder. DIOCESE OF COVINGTON: Suits v. Class Action Lawyers Dismissed ------------------------------------------------------------- Jon Newberry, writing for Business Courier, reports that Kenton Circuit Judge Gregory Bartlett in Covington on Jan. 23 dismissed two lawsuits against Cincinnati lawyer Stan Chesley and his associate Bob Steinberg related to their handling of the Covington Diocese sex-abuse class-action settlement. The diocese class-action was settled in 2006. The first of the two lawsuits was filed in May 2010 alleging, among other things, that Messrs. Mr. Chesley and Steinberg failed to adequately inform the plaintiffs about the settlement process and final terms. Judge Bartlett ruled that the Boone Circuit Court, which handled the original class-action litigation, had already determined the diocese settlement was fair, reasonable and adequate following a fairness hearing. The decision echoed an earlier decision by U.S. District Judge Danny Reeves, who ruled that the federal court did not have jurisdiction to hear the complaints because of earlier state court rulings on the matter. A statement sent from Mr. Chesley's office referred to the complaints as "baseless lawsuits . . . by a small number of disgruntled class members" who were all "associated with attorney Barbara Bonar or her attorney, Thomas Clay." Louisville lawyer David Ward, an associate of Mr. Clay's who attended a hearing in Judge Bartlett's courtroom last week, said at the time that they would appeal to the Kentucky Court of Appeals if Bartlett ruled against them. Messrs. Ward and Clay represent three claimants in the Diocese settlement who sued Mr. Chesley. A fourth claimant filed a lawsuit on her own behalf without legal representation. Mr. Chesley's statement said Bonar unsuccessfully sued him and his firm in a dispute over legal fees from the diocese settlement. The trial judge in that case ruled Ms. Bonar was not entitled to any of the fees, and that decision was upheld by the Court of Appeals. Ms. Bonar then appealed to the Kentucky Supreme Court, which decided to review the case and is scheduled to hear oral arguments Feb. 16. FOCUS MEDIA: Faces Securities Class Action Suit in New York ----------------------------------------------------------- Focus Media Holding Limited is facing a securities class action lawsuit in New York, according to the Company's January 20, 2012, Form 20-F/A filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2010. On December 12, 2011, Plaintiff Tom Palny filed a putative class action lawsuit in the United States District Court for the Southern District of New York against the Company and certain of its current or former officers and directors. The complaint relates to certain allegations made by the firm Muddy Waters about the Company in a series of releases in November 2011, and alleges that the Company's public filings, including the Company's 2006, 2007, 2008, 2009 and 2010 Form 20-Fs, the Form F-1 and Prospectus filed in connection with the Company's November 2007 secondary offering, and the Q3 2011 earnings press release, contain material misstatements and omissions. The complaint's allegations, include, but are not limited to, alleged misrepresentations relating to the Company's acquisition, write-down and divestiture of certain assets (including, without limitation, Allyes, OOH, and certain mobile handset companies), and the size and composition of the Company's LCD display network. Defendants have not yet been served with the complaint. The Company says it intends to defend against this lawsuit vigorously as it believes it has meritorious defenses to the claims alleged. However, there can be no assurance that the Company will prevail in the lawsuit and any adverse outcome could have a material adverse effect on its business or results of operations. GOOGLE INC: 9th Cir. Upholds Approval of CLRB Settlement -------------------------------------------------------- The U.S. Court of Appeals for the Ninth Circuit affirmed the district court's approval of a class action settlement, approval of the notice to the class of the proposed settlement, and award of attorney's fees in the class action styled as CLRB Hanson Industries, LLC, Howard Stern, on behalf of themselves and all others similarly situated v. Google Inc., Case No. 09-17380. The Ninth Circuit ruling is issued upon the appeal of Weiss & Associates, P.C., from the lower court's decision. A copy of the Ninth Circuit's Jan. 5, 2012 memorandum is available at http://is.gd/erWQhyfrom Leagle.com. GOV'T OF CANADA: Judge Certifies Class Action Over Charity Tax -------------------------------------------------------------- Joseph Brean, writing for National Post, reports that an Ontario Superior Court judge has certified a massive class-action lawsuit over a "scheme" in which thousands of Canadians submitted inflated charitable donation receipts the taxman refused to accept. "When Michael Cannon heard about the Donations for Canada Gift Program -- an opportunity to obtain a C$10,000 charitable tax credit in return for a C$2,500 donation -- he thought it was too good to be true," wrote Mr. Justice George Strathy. "It was. A few years later, his tax returns were reassessed by Canada Revenue Agency and he had to repay his deductions, with interest. The only thing he received for his 'donation' was a tax bill." Mr. Cannon, a retired police officer who donated more than C$20,000, is the representative plaintiff for the class, which includes nearly 10,000 Canadians from every province and territory except the Northwest Territories, who contributed a total of C$144-million to the plan. "They came from all walks of life: teachers, lawyers, nurses, administrators, presidents and police officers," the judge wrote. One person donated C$4-million. More than 700 people donated more than $100,000 each. Calling it a "scheme" that serves only to enrich a private tax shelter, the CRA decided these donors lacked "donative intent," meaning that the supposed gift did not cost them anything because they expected to be enriched by a far larger tax credit. As a result, they were required to repay the full deduction, plus interest. The gift program was the idea of Edward Furtak, a businessman the judge described as a "puppet master" who licenses financial software through a trust in Bermuda. He was originally a defendant in this lawsuit, but settled with Mr. Cannon "in exchange for information and some degree of co-operation." The other defendants include Mr. Furtak's corporations and private trusts, the directors and trustees of the Funds for Canada Foundation, a prominent Nova Scotia tax lawyer and his firm. The judge wrote that for the program to work, it needed donors "who were willing to buy into the concept," and for that it needed both a sales team and a written legal opinion that the gift program would survive a challenge by the CRA. It also needed a network of companies, trusts and agreements to process the flow of funds, and significant cash flow, which Mr. Furtak's Bermuda trust provided. And it needed legitimate charities "that were in need of cash and were prepared to give back 99% of the money donated to them to Furtak's companies in return for the promise of a future income stream from the use of [Mr. Furtak's] software program." Initially, in 2005, these included Biathlon Canada, Canadian Lacrosse Association, Little League Baseball Canada, and amateur associations for football, wrestling and bowling. The next year the Scarboro Foreign Missions and the New Brunswick Foundation for the Arts participated. No wrongdoing is alleged on the part of the charities. When a donor gave C$2,500, he would also become the beneficiary of a private charitable trust created by Mr. Furtak, which would then "prime the pump," as the judge put it, by acquiring units of this trust for C$7,500. The ultimate result would be that C$10,000 would remain in the possession of a charity for a "scintilla juris," a legal term meaning a mere instant, and the donor received two tax reciepts: one for C$2,500 in cash, and one for a C$7,500 donation-in-kind, for the trust units. In the eyes of the taxman, the judge wrote, this "was nothing more than a scheme, in which the funds of 'donors' like Mr. Cannon flowed through a giant circle into the pockets of the promoters." When the CRA revoked the charitable status of the Funds for Canada Foundation in 2009, saying it operated for the private benefit of tax-shelter operators, an audit revealed it had issued nearly C$176.5-million in receipts for cash received through a tax shelter. "The charity, in turn, paid over C$14.2-million to the tax-shelter promoter as fundraising fees and directed C$160.8 million to an offshore investment vehicle," according to a CRA statement. "Our audit findings indicate that 79.05% of the funds directed to the offshore investment vehicle were eventually returned to the original lender of the funds. The charity retained a meager 1% of the total tax-receipted amounts for use in its own programs." No trial date has been set. HEWLETT-PACKARD: Fined $425,000 Over Lithium-Ion Battery Packs -------------------------------------------------------------- The U.S. Consumer Product Safety Commission (CPSC) announced that Hewlett-Packard Company (HP), of Palo Alto, California, has agreed to pay a civil penalty of $425,000. The settlement agreement [http://www.cpsc.gov/cpscpub/prerel/prhtml12/12091.pdf]has been provisionally accepted by the Commission (3-1). The settlement resolves staff allegations that HP knowingly failed to report immediately to CPSC, as required by federal law, that certain lithium-ion battery packs contained a defect or created an unreasonable risk of serious injury or death. The lithium-ion battery packs can overheat, posing a fire and burn hazard to consumers. The packs were shipped with new HP Notebook computers, sold as accessories or provided as spare parts for various HP models. CPSC staff alleges that by September 2007, HP knew of about 22 incidents associated with the lithium-ion battery packs. At least two of these incidents resulted in injuries to consumers. HP also was aware that at least one consumer apparently went to the hospital. HP did not receive any information on the consumer's injuries or treatment, if any. CPSC staff also alleges that between March 2007 and April 2007, HP conducted a study, from which it obtained additional information about the lithium-ion battery packs. HP did not notify the Commission about the incidents or the study until July 25, 2008. By that time, CPSC staff alleges that the firm was aware of at least 31 incidents involving the lithium-ion battery packs. In October 2008, HP and CPSC announced a recall [http://www.cpsc.gov/cpscpub/prerel/prhtml09/09035.html]of about 32,000 lithium-ion battery packs. HP sold notebook computers for between $700 and $3,000 that contained the lithium-ion battery packs, as did computer and electronics stores nationwide and various Web retailers. Lithium-ion battery packs that were sold separately for use with the notebook computers retailed for between $100 and $160. 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. In agreeing to the settlement, HP denies CPSC staff allegations that the lithium-ion battery packs (or the notebooks with which the packs were used) could create an unreasonable risk of serious injury or death, or that HP violated the reporting requirements of the Consumer Product Safety Act. * Statement of Chairman Inez Tenenbaum on the Proposed Civil Penalty Settlement for Hewlett-Packard [http://www.cpsc.gov/pr/tenenbaum01192012.pdf] * Statement of Commissioner Robert Adler on the Proposed Civil Penalty Settlement for Hewlett-Packard http://www.cpsc.gov/pr/adler01192012.pdf HSBC HOLDINGS: Terminates Thema Fund Class Action Settlement ------------------------------------------------------------ FNNO, citing Dow Jones, reports that HSBC terminated a proposed settlement relating to Thema UCITS Fund after a New York federal court dismissed claims against the bank and the other defendants in a class action suit, saying Ireland was a more appropriate forum to litigate the claims. HSBC Holdings is currently below its 200-day moving average (MA) of $44.86 and should find support at its 50-day MA of $38.72. In the last five trading sessions, the 50-day MA has fallen 0.53% while the 200-day MA has slid 0.51%. HSBC Holdings plc is the holding company for the HSBC Group. The Company provides a variety of international banking and financial services, including retail and corporate banking, trade, trusteeship, securities, custody, capital markets, treasury, private and investment banking, and insurance. The Group operates worldwide. INVESTMENT RETRIEVERS: Accused of Illegal Debt Collection in Ill. ----------------------------------------------------------------- Gary Harris, individually and on behalf of the classes defined herein, and People of the State of Illinois ex rel. Gary Harris v. Investment Retrievers, Inc., Case No. 2012-CH-02141 (Ill. Cir. Ct., Cook Cty., January 20, 2012) seeks redress for the conduct of Investment Retrievers in taking collection actions prohibited by the Illinois Collection Agency Act. Although unlicensed, Investment Retrievers instituted more than 35 lawsuits against Illinois consumers between January 1, 2008, and June 25, 2010, the Plaintiff alleges. The Plaintiff adds that Investment Retrievers also took collection action in existing cases and collected money from other Illinois consumers. The Plaintiff is a resident of Cook County, Illinois. Investment Retrievers, a California corporation, purchases or claims to purchase charged-off consumer debts and enforcing the debts against the consumers by filing collection lawsuits and otherwise. The Plaintiff is represented by: Daniel A. Edelman, Esq. Cathleen M. Combs, Esq. James O. Latturner, Esq. EDELMAN, COMBS, LATTURNER & GOODWIN, LLC 120 S. LaSalle Street, 18th Floor Chicago, IL 60603 Telephone: (312) 739-4200 Facsimile: (312) 419-0379 E-mail: courtecl@edcombs.com ccombs@edcombs.com jlatturner@edcombs.com LADENBURG THALMANN: Unit Paid All Dues in Consolidated Suit Deal ---------------------------------------------------------------- Ladenburg Thalmann Financial Services Inc. disclosed in its January 20, 2012, Form 8-K/A filing with the U.S. Securities and Exchange Commission, that all due payments in connection with a settlement of class action lawsuits involving its subsidiary, were fully paid since no appeal was filed against the settlement. On November 9, 2011, Ladenburg Thalmann Financial Services Inc. reported to the SEC its acquisition of the outstanding capital stock of Securities America Financial Corporation ("SAFC"). In July 2009, two issuers of private placement interests (Medical Capital Holdings, Inc./Medical Capital Corporation and affiliated corporations and Provident Shale Royalties, LLC and affiliated corporations) sold by SAFC were the subject of SEC actions against those entities and individuals associated with them, which has resulted in the filing of several putative class action lawsuits naming both SAFC and Ameriprise Financial, as well as related regulatory inquiries. Approximately $400 million of Medical Capital and Provident Shale investments made by SAFC's clients are outstanding and currently in default. On January 26, 2010, the Commonwealth of Massachusetts filed an Administrative Complaint against SAFC. A significant volume of FINRA arbitrations have been brought against SAFC. Several of them were individually settled and there was one adverse ruling. The putative class actions and arbitrations generally allege violations of state and/or federal securities laws in connection with SAFC's sales of these private placement interests. These actions were commenced in September 2009 and thereafter. The Medical Capital-related class actions were centralized and moved to the Central District of California by order of the United States Judicial Panel on Multidistrict Litigation under the caption "In re: Medical Capital Securities Litigation." The Provident Shale-related class actions remain pending in Texas federal court. On June 22, 2010, the Liquidating Trustee of the Provident Liquidating Trust filed an adversary action ("Liquidating Trustee Action") in the Provident bankruptcy proceeding naming SAFC on behalf of both the Provident Liquidating Trust and a number of individual Provident investors who are alleged to have assigned their claims. The Liquidating Trustee Action generally alleges the same types of claims as are alleged in the Provident class actions, as well as a claim under the Bankruptcy Code. The Liquidating Trustee Action has been moved from bankruptcy court to the Texas federal court with the other Provident class actions. On January 24, 2011, the Medical Capital Class Action was temporarily transferred to the Northern District of Texas (the "Court"), where the Provident class action was pending, so that coordinated settlement negotiations could be conducted under that single Court's supervision. On February 17, 2011, the named plaintiffs to the class actions filed with the Court a Settlement Agreement and Motion for Preliminary Approval of Class Action Settlement, seeking the court's approval of agreed-upon settlement terms. On March 18, 2011, the Court declined to grant preliminary approval of that settlement. On April 15, 2011, SAFC entered into new settlement agreements which, in exchange for release of pending arbitration and litigation claims (including certain class action claims pending against SAFC and the claims brought by the Liquidating Trustee), provide for the payment of a total of $123 million. The new settlements were subject to certain conditions, including participation requirements for claimants to be covered by the settlements, and preliminary and final review and Court approval of the class action settlement. The Court granted preliminary approval of the settlement after a hearing on April 29, 2011, and on July 27, 2011, the Final Approval Hearing was held, at which the judge stated that he would give final approval to the class action settlement agreement. The Court issued an order approving the class action settlement on August 4, 2011, and since no appeal was filed, all payments due were fully paid shortly thereafter. A related Administrative Complaint brought against SAFC by the Commonwealth of Massachusetts on January 26, 2010, was also settled on May 24, 2011, with an agreement to pay $2.8 million to Massachusetts investors. Including another $13.0 million in other legal reserves as of December 31, 2010, the matters collectively total $138.8 million as of December 31, 2010, and are included in special reserves on the condensed consolidated statements of financial condition. The expense associated with the special reserves has been recognized in legal settlements in the year ended December 31, 2009, the year in which the case was filed in accordance with ASC 855 "Subsequent Events". LOUISIANA CITIZEN: Court Denies Bid for Class Action Rehearing -------------------------------------------------------------- Rebecca Mowbray of The Times-Picayune, reports that the Louisiana Supreme Court has declined to reconsider its ruling in a class- action lawsuit against Louisiana Citizens Property Insurance Corp. that could cost the state-run insurer of last resort about $103.8 million. The state's highest court declined the application for rehearing on Jan. 20 by the same 4-3 vote that reinstated a March 2009 lower court judgment against Louisiana Citizens. Associate Justices John Weimer, Jeffrey Victory and Greg Guidry said they would have reheard the case. In the original March 2009 judgment, Judge Henry Sullivan of the 24th Judicial District Court in Jefferson Parish awarded 18,573 homeowners in the class-action case, Geraldine R. Oubre et al. v. Louisiana Citizens Fair Plan, $5,000 each because Citizens' own records proved that the state-sponsored insurer of last resort waited more than 30 days to begin adjusting hurricane claims, violating state law. A state appeals court had thrown out the ruling before the Supreme Court reinstated it in December. While the original $92.8 million judgment was on appeal, another $11 million in interest was added to the verdict, bringing the total to about $103.8 million. The move is potentially great news for Citizens policyholders who were jilted by the insurer during hurricanes Katrina and Rita. When the 2005 storms hit, Citizens was beset with operational problems, and started adjusting hurricane claims later than other companies, putting policyholders behind in getting money to begin home repairs. In December, Insurance Commissioner Jim Donelon called state supreme court's decision "unconscionable." Citizens has about $200 million in the bank and can afford to pay the judgment, but Mr. Donelon said the verdict places the insurer at risk if a hurricane hits this season. Citizens chief executive Richard Robertson said that his company plans to ask the U.S. Supreme Court to review the case. "The last thing that can be done from a legal perspective is to ask the U.S. Supreme court to take up the case, and we have 90 days from last Friday to do that," he said. "If they don't take it up, all the appeals are exhausted, we'd have to pay the judgment." Before any money can be distributed to policyholders, the judgment in the case must be finalized. Plaintiff attorneys in the case weren't immediately available for comment Monday, so it wasn't clear whether that could happen while a U.S. Supreme Court application was pending. Meanwhile, the cost of the Oubre case could grow. Another 7,000 to 10,000 homeowners in the Oubre case also say that Citizens initiated the adjustment of their hurricane claims too slowly. Their motion had been on hold while the case was on appeal, but if Judge Sullivan finds in their favor, Citizens could have to pay another $35 million to $50 million. MOSTYN LAW FIRM: Paralegals' Class Action Gets Conditional Okay --------------------------------------------------------------- Bonnie Barron at Courthouse News Service reports that a federal judge has conditionally certified a class of paralegals who demand overtime pay from the Texas law firm that negotiated a huge insurance settlement for hurricane victims. Lead plaintiff Sherri Davis says the Mostyn Law Firm denied overtime pay to paralegals who worked more than 40 hours in a week, as mandated by the Fair Labor Standards Act. Texas Monthly included the law firm's founder, Steve Mostyn, as one of the most influential people determining the fate of Texas in 2011. The article states that "Mostyn, who made his fortune representing home-owners devastated by Hurricane Rita (2005) and Ike (2008), contributed nearly $10 million to Democratic causes in the 2010 election cycle." The Texas Windstorm Insurance Association ultimately settled Hurricane Ike claims for $189 million. In addition to its two Houston locations, the Mostyn Law Firm has offices in Austin, Galveston and Beaumont. Ms. Davis says that she often worked more than 70 hours a week for the firm in Houston during her employment as a paralegal from June 2007 to February 2009, yet she only received a salary that covered 40 hours per week. Carlos Alvarado, who joined the federal class action as a plaintiff after it was filed in August 2011, reported a similar experience. He says he didn't receive overtime pay, despite putting in more than 50 hours a week as a paralegal for the firm from July 2009 to June 2010. U.S. District Judge Keith Ellison on Jan. 19 granted certification for a class of current and former salaried paralegals who worked at the firm but did not receive time-and-a-half pay for hours worked in excess of 40 per week going back to Aug. 3, 2008. Though Messrs. Davis and Alvarado have not worked for Mostyn in over a year, Judge Ellison rejected claims that they are disconnected from paralegals employed more recently by the firm. "Plaintiffs assert that they worked with, knew of, and conversed with other salaried paralegals who worked more than forty hours per week and were also denied overtime pay," Judge Ellison wrote. "Davis also contends that she spoke with office manager, Margaret McCoy, who informed her that no salaried employee received overtime pay. With these declarations, plaintiffs have established that there is a reasonable basis to believe other aggrieved individuals exist." Mostyn also claimed that class members were not similarly situated because of variations in job duties, titles and locations, but Judge Ellison disagreed. "The court finds that plaintiffs have shown a reasonable basis that others will join the lawsuit because additional plaintiffs have joined the lawsuit since its inception, in conjunction with the fact that plaintiffs have named other paralegals who worked overtime without being paid at an overtime rate," Judge Ellison wrote. Mostyn did persuade the court to narrow the class definition in two aspects. "The court agrees that notice should not issue as to 'legal assistants,' as plaintiffs nowhere provide a basis for assuming that they are similarly situated to legal assistants, or indeed even describe the job duties of legal assistants," Judge Ellison wrote. "The court also believes that the proposed class should be limited to salaried paralegals only. Plaintiffs have not advanced sufficient evidence to show there is a reasonable basis for believing that they are similarly situated to non- salaried paralegals." A copy of the Memorandum and Order in Davis v. The Mostyn Law Firm, P.C., Case No. 11-cv-02874 (S.D. Tex.), is available at: http://www.courthousenews.com/2012/01/23/Overtime%20Class.pdf STATE OF INDIANA: Witnesses' State Fair Class Action Dropped ------------------------------------------------------------ FOX59 reports that a class action lawsuit filed following the stage collapse at the Indiana State Fair in August has now been dropped. The dropped lawsuit was filed by individuals who said they witnessed the tragedy. Angela Fisher, who was part of the class action suit, said she was traumatized from watching her boyfriend jump into action to help the victims. Now, the attorneys who filed the suit are withdrawing it, due to lack of evidence to support the claim. When it was filed, the lawsuit drew outrage from other attorneys and critics who said this was a piggyback lawsuit, cheapening the claims of the real victims of the Indiana State Fair tragedy. VERIZON COMMS: Faces Class Action Over TV Protection Plan --------------------------------------------------------- Courthouse News Service reports that a federal class action claims Verizon sold a TV Protection Plan that promises subscribers with screens bigger than 32 inches would not have to pay the $75 fee for service calls, but refuses to make service calls unless they pay it. A copy of the Complaint in Chandra v. Verizon Communications, Inc., Case No. 12-cv-_____, docketed as Doc. 13916 in Case No. 33- av-00001 on Jan. 20, 2012 (D. N.J.), is available at: http://www.courthousenews.com/2012/01/23/Verizon.pdf The Plaintiff is represented by: Barry R. Eichen, Esq. Thomas Paciorkowski, Esq. EICHEN CRUTCHLOW ZASLOW & MCELROY, LLP 40 Ethel Road Edison, NJ 08817 Telephone: (732) 777-0100 E-mail: beichen@njadvocates.com tpaciorkowski@njadvocates.com - and - Sidney S. Liebesman, Esq. LIEBESMAN LAW, LLC 501 Silverside Road, Suite 2 Wilmington, DE 19809 Telephone: (302) 798-1000 E-mail: sliebesman@delawgroup.com VENOCO INC: Being Sold for Too Little, Del. Suit Claims ------------------------------------------------------- Courthouse News Service reports that shareholders say Venoco, an oil company, is selling itself too cheaply through an unfair process to its CEO and majority shareholder Timothy Marquez, for $12.50 a share or $1.5 billion, in Chancery Court. A copy of the Complaint in Feldbaum v. Venoco, Inc., et al., Case No. 7183 (Del. Ch. Ct.), is available at: http://www.courthousenews.com/2012/01/23/SCA.pdf The Plaintiff is represented by: Blake A. Bennett, Esq. COOCH AND TAYLOR, P.A. The Brandywine Building 1000 West Street, 10th Floor Wilmington, DE 19801 Telephone: (302) 984-3889 E-mail: bbennett@coochtaylor.com - and - Brian J. Robbins, Esq. Stephen J. Oddo, Esq. Arshan Amiri, Esq. Edward B. Gerard, Esq. ROBBINS UMEDA LLP 600 B Street, Suite 1900 San Diego, CA 92101 Telephone: (619) 525-3990 E-mail: brobbins@robbinsumeda.com soddo@robbinsumeda.com aamiri@robbinsumeda.com kmcintyre@robbinsumeda.com - and - Nicholas Koluncich, Esq. LAW OFFICES OF NICHOLAS KOLUNCICH III, LLC 6501 Americas Parkway NE, Suite 620 Albuquerque, NM 87110 Telephone: (505) 881-2228 E-mail: nkoluncich@newmexicoclassactions.com WESTWOOD COLLEGE: Sued Over False Claims on Accreditation --------------------------------------------------------- Jack Bouboushian at Courthouse News Service reports that Westwood College faces a class action from students, and another lawsuit from the Illinois attorney general, accusing the profit-seeking school of defrauding students with false claims about its accreditation. Latoya Sims filed the class action in Federal Court, and the Illinois attorney general sued the college and its corporate parent, Alta Colleges and affiliates, in Cook County Court. Ms. Sims says she graduated from Westwood College, but when she sought work in her field of juvenile justice, employers "promptly rejected her because the transcripts reflected coursework taken at a school lacking regional accreditation." Westwood's home page claims to have campuses in five states and online, and says, "Over 24,000 graduates have transformed their lives by obtaining the skills, tools, experience and connections necessary to achieve meaningful careers." But according to the complaint: "Westwood markets itself as a degree-granting 'institution of higher learning' that offers practical training and programs allegedly 'designed to empower students to pursue their individual career goals.' Although Westwood is a for-profit organization and its coursework is expensive, it boasts of offering a hands-on curriculum that will supposedly prepare students for careers in criminal justice, industrial services, and healthcare, among other industries. Westwood confers what it characterizes as a 'bachelor's degree' in these and similar fields after students earn three years of coursework. What Westwood has failed to offer its students and graduates, unfortunately, is a truthful assessment of the value of their coursework and degree. "The members of the plaintiff class are graduates of Westwood who were deceived by their school into believing that their courses were accredited, and that the academic credits that they earned would enable them to attain employment in their desired profession. Instead, these graduates learned that no employers in their field would accept their academic credits or recognize their costly degree, leaving them with massive student loan debt, worthless credits, and no closer to a position in their desired career than they were before they began their program. "Students, including plaintiff and members of the putative class, were drawn to Westwood's accelerated and supposedly 'career- focused' learning programs due to patently inaccurate and misleading representations that appeared on the school's Web site and were perpetuated by the school's academic and career advisors. Plaintiff and the class were given every reason to believe they would receive all of the tools and training necessary to continue their professional development -- whether by transferring to a graduate program or transitioning into a job. As they discovered upon graduating, however, Westwood's programs were anything but 'career focused,' and these alumni had nothing to show for all of the time and money they spent on courses there -- except substantial debt. "Accordingly, this nationwide class action seeks punitive damages and financial recovery for the injuries, expenses, financial losses, and intangible losses suffered by the plaintiffs and members of the class." Ms. Sims adds that when the college recruits students, "Westwood fails to explicitly mention that it does not have regional academic accreditation -- which is almost always necessary if students wish to continue their education elsewhere and receive credit for the courses that they have already completed." One day before Ms. Sims filed her federal class action, the Illinois attorney general sued the college in state court. Defendants in the state's complaint are Alta Colleges, Westwood College, Wesgray Corp. dba Westwood College-River Oaks and Westwood College-Chicago Loop, Elbert Inc. dba Westwood College-Du Page, and El Nell Inc. dba Westwood College-O'Hare Airport. All the corporate defendants were incorporated in Colorado. Illinois claims that Westwood "regularly promoted their Criminal Justice Program with television and radio advertisements depicting or presenting police officers -- despite the fact that many police departments do not recognize defendants' national accreditation, and as a result, very few graduates have ever become police officers in Illinois. Defendants even purchased search terms such as, 'Become Police Officer in Chicago,' 'Chicago Police Requirements,' 'Join the Illinois State Police,' and 'Regionally Accredited Schools Chicago' in order to present to prospective students their Internet ads and/or its website link as the top result in a Google or other search engine result. Defendants' admissions representatives were trained to engage in zealous selling techniques to convince prospective students that Westwood was just the right fit for the student to pursue his/her career goals, and in many instances made misrepresentations or false promises regarding the value and accreditation of Westwood's criminal justice degrees. When enrolling prospective students expressed concern about financing, defendants promised to assist the prospective students in obtaining part-time jobs to assist with paying for their degrees, but failed to follow through with that promise in any meaningful way. Defendants compounded these misrepresentations or false promises by misleading students about the magnitude of the financial burden associated with obtaining their degrees, engaging in a pattern and practice of downplaying the burdens of student loans they advised students to take out." In its 66-page complaint, Illinois says one student in Westwood's Criminal Justice Program, Paul Lindsay, "was pulled out of class on more than one occasion and told to go to the financial aid office." The complaint continues: "Once in the financial aid office, Mr. Lindsay was told that he would need to apply for additional loans to register for the next term. "He was additionally told he could not return to any classes, including the class he had just been pulled out of, until he filled out the appropriate paperwork to apply for the necessary loans. "According to Mr. Lindsay, defendants' actions felt like a 'shakedown' to him." The state adds: "In effect, defendants charge a premium for a criminal justice degree that many times is worthless because the degree does not assist students with finding employment in law enforcement, is not regionally accredited, and fails to adequately prepare students to secure employment that would enable them to repay their much larger federal and private student loans." Ms. Sims seeks damages for breach of contract, unjust enrichment and fraud. Illinois seeks damages for consumer fraud and deceptive trade, and wants the court to revoke, forfeit or suspend Westwood's Criminal Justice Program. A copy of the Complaint in Sims v. Westwood College, Case No. 12- cv-00396 (N.D. Ill.), is available at: http://www.courthousenews.com/2012/01/23/Westwood2.pdf The Plaintiff is represented by: Joseph J. Siprut, Esq. James M. McClintick, Esq. Aleksandra M. S. Vold, Esq. SIPRUT PC 122 South Michigan Avenue, Suite 1850 Chicago, IL 60603 Telephone: (312) 588-1440 E-mail: jsiprut@siprut.com jmcclintick@siprut.com avold@siprut.com YOUNG CHANG: App. Ct. Affirms Ruling Denying Class Certification ---------------------------------------------------------------- The Court of Appeals of California, Fourth District, upheld a trial court order denying certification of the purported class in the case, Carmen Genovese, et al. v. Young Chang America et al., Case No. D058380. The Appeals Court agrees with the trial court's finding that there is a lack common issues of fact and law, particularly with respect to privity of warranty or contract, and statute of limitations problems arising from the delayed manifestation of injury or defect. Young Chang Co Ltd. is a Korean piano manufacturer. The proposed class action was filed in 2007 by the plaintiffs against Young Chang Co. Ltd.'s American subsidiary distributors and marketers, Young Chang America Inc. and its later-formed "doing business as" company, and Music Corp. Plaintiffs brought a motion for certification of their proposed class of 59,470 piano purchasers, identified by serial numbers on the products sold to them, alleging that Defendants have known since 1996 about a defect in the composition of the metal used to manufacture the action brackets (which are piano component parts), but Defendants failed to remedy the defect, as required by their express or implied warranties. Plaintiffs seek damages and other relief for alleged breaches of product warranties, and for violations of the California Consumer Legal Remedies Act. On appeal, Plaintiffs assert the trial court erred and abused its discretion in denying their motion for class certification, by using improper legal criteria or making erroneous assumptions. A copy of the appeals court's Jan. 6, 2012 order is available at http://is.gd/NzPxBXfrom Leagle.com. YRC WORLDWIDE: Court Set to Decide on Class Action Settlement ------------------------------------------------------------- William B. Cassidy, writing for The Journal of Commerce Online, reports that a U.S. District Court will soon decide whether to put its final stamp of approval on a $6.5 million settlement to a class action lawsuit against YRC Worldwide. The U.S. District Court for the District of Kansas will hold a fairness hearing March 6 to determine whether the proposed settlement is "fair, reasonable and adequate." The lawsuit and settlement are part of the aftermath of the $4.3 billion trucking operator's severe losses in the years prior to its restructuring last July. Details of the proposed settlement, reached last year, were mailed to class members -- salaried and hourly non-union employees of YRC Worldwide -- on Jan. 14. Information on the class action lawsuit, including court documents, is available online. The class action lawsuit, recognized by the court in 2010, claimed YRC Worldwide violated federal law in its management of employee's 401(k) retirement plans. The class includes participants in several YRC Worldwide 401(k) plans from Oct. 25, 2007 through June 8, 2011 whose plans included shares of YRCW stock. The litigation alleged the carrier broke the law by allowing the plans to purchase and hold its stock at a time when it was "unsuitable and imprudent investment." In the settlement, YRC Worldwide denied any wrongdoing but agreed to the proposed settlement to "eliminate the burden and expense of further litigation." YRC Worldwide's stock value tumbled from 2006 through 2011, when it lost more than $2.5 billion and underwent two debt-for-equity swaps and reverse stock splits. The trucking operator's stock hit its nadir in December at about 3 cents per share before jumping above $9 a share Dec. 2 after a 300-to-1 reverse stock split. ********* 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. Noemi Irene A. Adala, Joy A. Agravante, Ivy B. Magdadaro, Psyche A. Castillon, Julie Anne L. Toledo, Christopher Patalinghug, Frauline Abangan and Peter A. Chapman, Editors. Copyright 2012. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter Chapman at 240/629-3300. * * * End of Transmission * * *