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/raid1/www/Hosts/bankrupt/CAR_Public/120611.mbx C L A S S A C T I O N R E P O R T E R Monday, June 11, 2012, Vol. 14, No. 114 Headlines AIG DOMESTIC: Blumenthal, Nordrehaug, Bhowmik Files Class Action ALON HOLDINGS: Dor Alon Still Defends Fueling-Related Suit ALON HOLDINGS: Eden Faces Suit Over Choking Hazard Warnings ALON HOLDINGS: Faces Class Suit Over Misleading Special Sales ALON HOLDINGS: Mega Retail Defends Suit Over "Economy Packs" ALON HOLDINGS: Overcharging Suit Parties Asked to File Pleadings ALON HOLDINGS: Series A Debentures Suit in Conclusions Stage ARCTIC GLACIER: Ontario Super. Court OKs Class Action Settlement ARKANSAS: Lottery Commission Disputes Ticket Flaw Suit AUSTRALIA: Subcontractors Asked to Join Suit v. NSW Gov't. CALIFORNIA: Faces Class Action Over Forced Furlough CATALINA RESTAURANT: Blumenthal Nordrehaug Files Class Action COMCAST: Faces Class Action Over Customer Data CVS: Judge Dismisses Class Action Over Employee Seats DJSP ENTERPRISES: Ex-Shareholders File Revised Class Action FACEBOOK INC: Alfred G. Yates Law Firm Files Class Action FANNIE MAE: Oral Arguments on Motions for Summary Judgment Begin HEARTLAND PAYMENT: Time to Appeal Class Settlement Order Open HILTON LAX: Settles Wage & Missed Breaks Class Action for $2.5MM IDAHO: Tribe to Get $60 Million in Settlement Money IMPERIAL TOBACCO: CEO Testifies in C$27BB Tobacco Class Action JP MORGAN: Settles Bid-Rigging Class Action Suit for $44MM KNOLOGY INC: Shareholders Sue Over Proposed WideOpenWest Sale KRAFT FOODS: Faces Wage and Hour Violations Suit in California LOS ANGELES, CA: LAPD Sued Over Discriminatory Arrests MAXIMUM RETURN: Smidi Must Pay $5.6MM in Alleged Ponzi Scheme NATIONWIDE COIN: Sued in California for False Advertising PHOENIX COMPANIES: Awaits Updates on Tiptree-Related Suit SOUNDBITE COMMUNICATIONS: Defends Against Sager Litigation SOUNDBITE COMMUNICATIONS: Sued Over Antitrust Violations TD AMERITRADE: Pleas to Dismiss Suit Over Yield Plus Fund Pending TREX CO: Class Suit Over Mold Growth Pending in Calif. WEST MARINE: Recalls 1,200 Folding Chairs Due to Collapse Hazard WHOLE FOODS: Obtains Favorable Ruling in Antitrust Class Action ZONEPERFECT NUTRITION: Sued Over "All Natural" Nutrition Bars ********* AIG DOMESTIC: Blumenthal, Nordrehaug, Bhowmik Files Class Action ---------------------------------------------------------------- Employment Lawyers Blumenthal, Nordrehaug & Bhowmik filed a class action lawsuit against AIG Domestic Claims, Inc. and Chartis Claims, Inc. on June 1, 2012, alleging that the company failed to pay the salaried workers' compensation hearing representatives overtime pay even though these employees worked in excess of 8 hours in a workday and more than 40 hours in a workweek. Gallardo, et al. v. AIG Domestic Claims, Inc. and Chartis Claims, Inc., Case No. 30-2012-00573906-CU-OE-CXC is currently pending in the Orange County Superior Court. According to the wage and hour class action Complaint filed against the workers' compensation service provider, Chartis violated California overtime laws by failing to pay hearing representatives for their overtime hours worked. Specifically, the Complaint alleges that the hearing representatives regularly worked 10 to 12 hours each workday without being compensated for any of their overtime hours worked. Under California law, companies are required to pay all non-exempt employees overtime compensation whenever the employees work more than eight hours in a day or forty hours in a week. In the opinion of the managing partner of the law firm, Norman B. Blumenthal, "this illegal practice of misclassifying employees as exempt from overtime wages strips workers of benefits and protections, puts responsible employers at a competitive disadvantage, and cheats taxpayers." Mr. Blumenthal claims that if the Courts would simply enforce overtime laws as Congress intended, these rulings would create thousands of jobs in America overnight. "If the wage and hour laws were enforced by the Courts, as, I think intended, corporations would hire more employees to get the job done rather than pay fewer employees overtime wages," says Mr. Blumenthal. Blumenthal, Nordrehaug & Bhowmik is a California employment law firm that focuses on salaried employee claims involving overtime pay laws under the California Labor Code and Fair Labor Standards Act. ALON HOLDINGS: Dor Alon Still Defends Fueling-Related Suit ---------------------------------------------------------- A class action was lodged against Alon Holdings Blue Square - Israel Ltd.'s subsidiary, Dor Alon Energy In Israel (1988) Ltd., and other fuel companies in December 2007. The total amount of the claim is NIS132 million (the subsidiary's share in this amount is NIS8.8 million). The claimant asserts that the defendants charged each customer NIS2 for fueling on Saturdays and on holidays. Based on the opinion of its legal advisers, the subsidiary's management believes that the chances of the claimant would prevail in the claim are lower than 50%, and therefore did not include a provision in its accounts for this matter. No further updates were reported in the Company's April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011. ALON HOLDINGS: Eden Faces Suit Over Choking Hazard Warnings ----------------------------------------------------------- A subsidiary of Alon Holdings Blue Square - Israel Ltd. is facing a purported class action lawsuit alleging violations of regulations on choking hazard warning on products, according to the Company's April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011. In December 2011, a letter of claim and a motion for approval of action as a class action was filed against the Company's 51% subsidiary, Eden Briut Teva Market Ltd. ("Eden") and additional food supplier, alleging that Eden and the additional food supplier are violating the Public Health (Food) Order [new version], 5643- 1983 and its regulations, according to which certain products must be marked with a choking hazard warning. If the claim is approved as a class action, the plaintiff claims it should apply to all Eden customers that purchased products which should be marked as aforementioned, including any customer who had bought such products by way of bulk. If the claim is approved as a class action, the approximate claim is estimated by the plaintiff at approximately NIS10 million. In the opinion of the Company, based on the opinion of its legal advisers, the chances that the claim will be rejected exceed 50%. Accordingly, the Company did not make any provision for this claim in its financial statements. ALON HOLDINGS: Faces Class Suit Over Misleading Special Sales ------------------------------------------------------------- Alon Holdings Blue Square - Israel Ltd. is facing a purported class action lawsuit alleging it misleads its customers with respect to special sales for food products that are sliced or cut, according to the Company's April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011. In March 2012, a letter of claim and a motion for approval of action as a class action was filed against the Company, alleging that it misleads its customers in special sales it holds regarding food products that are sliced or cut to the customers' request, and are priced per weight. The plaintiff claims that the Company does not provide full and correct details regarding the terms of the special sales, violating requirements of the law in connection with products marking and price display. The plaintiff claims, among other, that customers choosing to buy such products under special sales with accordance to the Company's advertisements are required to purchase not willingly an extra weight of the product, for the full price. If the Claim is approved as a class action, the approximate claim is estimated by the plaintiff at approximately NIS72 million. The plaintiff further requests the court to issue a decree ordering the Company to fulfill the requirements of the law. In the opinion of the Company, based on the opinion of its legal advisers, the chances that the claim will be rejected exceed 50%. Accordingly, the Company did not make any provision for this claim in its financial statements. ALON HOLDINGS: Mega Retail Defends Suit Over "Economy Packs" ------------------------------------------------------------ Alon Holdings Blue Square - Israel Ltd.'s subsidiary is defending a purported class action lawsuit alleging it unjustly enriched itself at the expense of the consumers by selling large packages of goods which are labeled as "economy packs," but has not lowered the price of the larger package, according to the Company's April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011. In July 2011, a letter of claim and a motion for approval of action as class action was filed against Mega Retail Ltd., claiming that Mega Retail has unjustly enriched itself at the expense of the consumers by selling large packages of goods which are labeled as "economy packs", but has not lowered the price of the larger package, thus forcing the consumers to buy a more expensive product instead of sufficing for an ordinary package. The appellant argues that the financial damage incurred by all class members is NIS15 million. The appellant further argues that the class suffered a non-monetary damage which it did not quantify. The court was also asked to issue an affirmative order to instruct the respondent to price its products according to the labeling as an "economy package". In the opinion of the Company, should it be obligated to pay any amount with regard to this matter, it is not expected to be a material sum. In the opinion of the Company and its advisors, the provisions included in the Company's financial statements are sufficient to cover the potential liabilities. ALON HOLDINGS: Overcharging Suit Parties Asked to File Pleadings ---------------------------------------------------------------- An Israeli court asked the parties of a purported class action lawsuit initiated against a subsidiary of Alon Holdings Blue Square - Israel Ltd. to file their pleadings before their compromise agreement is filed, according to the Company's April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011. In October 2009, Dor Alon Energy In Israel (1988) Ltd. received a statement of claim and an application for approval of the claim as a class action; the claim was lodged against Dor Alon and other fuel companies. The claimant claims payment of damages of NIS124 million (Dor Alon's share in the said claim amount as per the statement of claim is NIS21.9 million). According to the claimant, the defendants overcharged him for fuel when filling up his car. According to the claimant, after passing his debit card but before starting to fill up, the payment meter started operating without the provision of fuel. The overcharge has allegedly amounted at times to several Agorot and at times to several NIS. The parties have reached a compromise that was rejected by court, and the court asked the parties to file their pleadings before the compromise agreement is filed. In the event the parties will not reach a compromise agreement, the Company believes that the chances that the claim will be allowed are less than 50%, and therefore Dor Alon did not make a provision in its financial statements. ALON HOLDINGS: Series A Debentures Suit in Conclusions Stage ------------------------------------------------------------ Alon Holdings Blue Square - Israel Ltd. disclosed in its April 30, 2012, Form 20-F filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2011, that the claim filed by holders of its subsidiary's Series A debentures is currently in the conclusions stage. On June 27, 2010, a statement of claim and a request to approve the claim as a class action and as a derivative claim was filed against Dor Alon Energy In Israel (1988) Ltd., members of the Board of Directors of Dor Alon and Alon. The claim was lodged by holders of Series A debentures of Dor Alon that wish to represent the holders of Series A Dor Alon debentures as of February 7, 2010, who did not convert the debentures into Dor Alon shares. In their claim, the plaintiffs claim that the distribution (on February 9, 2010) of the shares of Alon Natural Gas Exploration Ltd. to Dor Alon's shareholders was an unlawful distribution. The plaintiffs also claim that Dor Alon should have adjusted the Series A debentures' conversion rate following the distribution of shares. The plaintiffs request that the Court would oblige Alon and the members of Dor Alon's Board of Directors to return to Dor Alon the shares that were distributed; alternatively, the plaintiffs request that Dor Alon will be required to adjust the conversion rate of the debentures to the "Ex rate" subsequent to the distribution; alternatively, the plaintiffs seek damages for non adjustment of the conversion rate. In November 2010, the defendants filed their responses to court, and as of April 30, 2012, the claim is in the conclusions stage. Based on information received from Dor Alon's management, the Company believes that the chances that the claim will be allowed are less than 50% and therefore Dor Alon did not make a provision in its financial statements. ARCTIC GLACIER: Ontario Super. Court OKs Class Action Settlement ---------------------------------------------------------------- Arctic Glacier Income Fund on June 5 disclosed that Ontario Superior Court has approved the settlement of the class action lawsuit filed by unitholders of the Fund. The settlement, announced on February 8, 2012, was subject to the approval by the Court. The Court Order found the settlement of $13.75 million to be fair and reasonable to the class members and approved the Settlement Agreement. The settlement will be entirely funded by Arctic Glacier's insurers, without the Fund making any admission of liability or making any monetary contribution to the settlement. The class action named the Fund, its trustees, its operating company, Arctic Glacier Inc. and certain of its current and past senior officers and directors. The suit sought damages on behalf of all persons who acquired Arctic Glacier units between March 22, 2002 and September 16, 2008. The Court Order approving the settlement and the Settlement Agreement provides for an opt-out period of 60 days for those class members who elect not to participate in the settlement. The opt-out period will begin to run from the date the Notice of Court Approval is published, which is expected to be June 13, 2012. The settlement is expected to become final and binding, including the release of all parties from all claims advanced in the class action, at the expiry of the opt-out period. About Arctic Glacier Arctic Glacier Income Fund, through its operating company, Arctic Glacier Inc., is a producer, marketer and distributor of packaged ice in North America, primarily under the brand name of Arctic Glacier(R) Premium Ice. Arctic Glacier operates 39 production plants and 47 distribution facilities across Canada and the northeast, central and western United States servicing more than 75,000 retail locations. ARKANSAS: Lottery Commission Disputes Ticket Flaw Suit ------------------------------------------------------ The Associated Press reports that the Arkansas Lottery Commission is denying allegations that it deliberately sold unsecure tickets that had a design defect that could easily lead to potential tampering. Assistant Attorney General Mark Ohrenberger submitted the statements on June 1 in legal papers in response to a lawsuit filed by a Little Rock man who claims he bought two $20 Arkansas Millionaires Club tickets that had been damaged. State officials also disputed claims that the agency deliberately allowed flawed tickets to remain in play rather than risk losing revenue. Richard Tomboli sued in April after discovering that both tickets were tampered with to the point where someone could determine whether the card was at least a $50 winner, the Arkansas Democrat Gazette reported in the June 2 editions. Mr. Tomboli's April 23 complaint to lottery officials led to a Little Rock police investigation that resulted in the arrest of a Raceway store's former manager, who was charged with theft. Meanwhile, Mr. Tomboli claimed that the commission's security chief told him the tickets had a manufacturing defect but the commission didn't want to stop selling them, because the agency would lose money while they were reprinted by ticket manufacturer Scientific Games. He also said he was given lottery marketing merchandise, including tote bags, T-shirts, sunglasses and hats, as a "gesture of thanks" for reporting the marred tickets. In Mr. Ohrenberger's response, the commission said security chief Lance Huey did speak with Mr. Tomboli, but officials say accounts of the conversations are inaccurate. The lawsuit accuses the commission of committing fraud and violating its duty to manage the lottery. Huey, Lottery Director Bishop Woosley, commission chairman Dianne Lamberth and Scientific Games also are named as defendants in the case. Mr. Tomboli's lawyer, state Rep. John Walker, is seeking class- action status for the complaint and has asked a judge to stop further Millionaire ticket sales. AUSTRALIA: Subcontractors Asked to Join Suit v. NSW Gov't. ---------------------------------------------------------- Leonie Lamont, writing for BusinessDay, reports that immediate future of the Reed construction group has been thrown into doubt amid fears that subcontractors and suppliers will not be paid what has been estimated to be up to AUD80 million owed to them. On June 6, the New South Wales Department of Education told BusinessDay that it owed nothing to Reed for work done under the Building the Education Revolution contracts. The prospect of tens of millions of dollars in BER payments flowing to Reed has been the lifeline on which subcontractors and other creditors have been relying. It also emerged that subcontractors owed money by Reed for work on NSW road projects were being asked to sign up to a possible class action against the state government. Glenn Bower, the managing director of Recoup Contractor Debt Recovery, said the class action was in addition to the 20 clients he represented owed nearly AUD20 million. "I just want to put the pressure on the government to pay the subbies because we believe Roads and Maritime Services is culpable," he said. The Reed troubles underline the turmoil in the building sector, which has recently seen the collapse of the century-old firm Kell & Rigby, and St. Hilliers Construction. The Reed Group, which is privately owned by Geoff Reed, diversified into the mining and energy equipment sector last year. In the process, Westpac approved a loan last September of up to AUD100 million, secured against the company's assets. Mr. Reed has also given a personal guarantee of AUD13 million. Mr. Reed had claims against the government for money it says it was owed on education and roads projects. The dispute was dealt with by an expert panel, but its findings about quantum have not been released. Following inquiries on June 6, the Education Minister's spokesman, Mark Davis, confirmed other legal communications about BER, which BusinessDay has seen. "The expert determination process is ongoing, which means the department is not able to discuss details of that process at this time," he said. "However, the department believes it has no obligation to make further payments to Reed under the Building the Education Revolution program. The department communicated this to Reed after the interim determination was handed down on May 21." Mr. Reed said on June 6 it was "still in negotiations" with the government about the panel's determination. The matter came to a head as the Queensland building firm J Hutchinson Pty Ltd, which is owed AUD640,000 for BER work and is a party to a winding-up application against Reed in the NSW Supreme court this month, voiced its frustration that subcontractors and suppliers had not been given a proper update about the panel's determination. CALIFORNIA: Faces Class Action Over Forced Furlough --------------------------------------------------- Courthouse News Service reports that Dr. Mark Horton, former director of the California Department of Public Health, claims in a class action that the Department of Personnel Administration illegally reduced his and dozens of other appointees' salaries by forced furlough days, as they are exempt from civil service rules, in Superior Court. A copy of the Complaint in Horton v. Brown, et al., Case No. 34- 2012-00125438 (Calif. Super. Ct., Sacramento Cty.), is available at: http://www.courthousenews.com/2012/06/06/CalBudget.pdf The Plaintiffs are represented by: Robin K. Perkins, Esq. Natalia D. Asbill, Esq. PERKINS & ASSOCIATES 300 Capitol Mall, Suite 1800 Sacramento, CA 95814 Telephone: (916) 446-2000 E-mail: rperkins@perkins-lawoffice.com nasbill@perkins-lawoffice.com CATALINA RESTAURANT: Blumenthal Nordrehaug Files Class Action ------------------------------------------------------------- On June 4, 2012, the overtime attorneys at Blumenthal, Nordrehaug & Bhowmik filed a class action Complaint against Catalina Restaurant Group Inc. and JoJo's California Family Restaurants, Inc. for wage and hour violations, specifically for violating California labor laws in regards to overtime pay and requiring their employees to work off-the-clock without being paid for all their hours worked. McDermott, et al. vs. Catalina Restaurant Group Inc. and JoJo's California Family Restaurants, Inc., Case No. 30-2012-00574113 is currently pending in Orange County Superior Court for the state of California. According to the class action Complaint filed against Catalina, the restaurant "did not have in place an immutable timekeeping system to accurately record and pay Plaintiff and other California Class Members for the actual number of hours these employees worked each day, including overtime hours worked." Specifically, the lawsuit claims that Catalina "consistently did not allocate enough labor hours such that there was not enough time for Plaintiff and California Class Members to complete their required duties." As a result, the Complaint alleges Plaintiff and California Class Members were forced to clock out of Catalina's timekeeping system, but were still required to perform additional work for Catalina for which they were not compensated for. Furthermore, the Complaint also alleges that the Plaintiff and California Class Members received non-discretionary quarterly bonuses from Catalina, but Catalina failed to include this extra bonus compensation in the regular rate of pay for the purposes of calculating the correct overtime pay rates owed to these employees. The failure to include the bonus compensation in the regular rate of pay for overtime purposes, according to the complaint, "has resulted in a systematic underpayment of overtime compensation" to the Plaintiff and members of the California Class. The Complaint further claims that as a result of Catalina's failure to record all hours worked by members of the California Class and Catalina's failure to pay these employees the correct overtime rate, Catalina "failed to provide the Plaintiff and the other members of the California Class with complete and accurate wage statements which failed to show, among other things, the correct number of all hours worked and the correct overtime rate for overtime hours worked." Founding partner of Blumenthal, Nordrehaug, & Bhowmik, Norman Blumenthal asserts, "when employers exclude non-discretionary bonuses from the regular rate of pay when calculating their employee's overtime rate, they are violating the law." Blumenthal, Nordrehaug & Bhowmik is a California employment law firm that dedicates its practice to helping employees, investors and consumers fight back against unfair business practices, including violations of the California Labor Code and Fair Labor Standards Act. COMCAST: Faces Class Action Over Customer Data ---------------------------------------------- Eriq Gardner, writing for The Hollywood Reporter, reports that class-action lawsuits have been launched against Comcast and Time Warner Cable alleging the companies collect Social Security numbers, credit card information and other information from customers and retain the data even after cable service is canceled. The plaintiffs say this is a violation of the Cable Communications Policy Act. The two lawsuits were filed late last week in California federal court. According to the complaint against Comcast, "consumers are unaware that their personally identifiable information is retained indefinitely by Comcast, as Comcast fails to send annual privacy notices informing consumers that Comcast continues to retain their information." The plaintiffs say that the CCPA requires cable operators to destroy personally identifiable information when it is no longer required for the purpose for which it was collected and that the companies also have privacy disclosure duties. The lawsuit cites "troubling" issues implicated by the alleged practice, including the risk of identity theft and conversion of personal financial accounts. Besides CCPA, the proposed class of plaintiffs also asserts violation of California Customer Records Act and breach of implied contract. They are seeking an order that enjoins the cable companies from allegedly unlawful practices as well as liquidated damages. The complaint says the CCPA law allows an individual to collect $100 a day for each day of violation. TWC declined comment. Comcast hasn't responded yet. CVS: Judge Dismisses Class Action Over Employee Seats ----------------------------------------------------- On June 1, a California judge ruled that CVS does not have to provide chairs for its cashiers. The decision ended a class action lawsuit filed in 2009 by Nykeya Kilby, a former cashier at a CVS in Chula Vista, Calif. Ms. Kilby accused her employer of not following a state labor law that requires retailers to provide "suitable seats" for employees, according to court documents. Many of the tasks performed by CVS cashiers, such as scanning merchandise, receiving payment, making change and waiting for customers could be performed while seated, Ms. Kilby's attorneys wrote in her original complaint. In Europe, most cashiers in supermarkets and other chain stores sit down while working. In the U.S., the custom of standing up was hardly questioned before 2009, when a handful of California workers filed class action lawsuits against Home Depot, 99 Cents Only and other retailers. Since, Walmart and Target have also been hit with lawsuits. Workers claim that the companies should not only provide seats but pay each worker who was made to stand a penalty under a 2004 law called the Private Attorneys General Act. Critics have dubbed the Act the "Sue Your Boss Law," as it allows employees to demand penalties for any violations of California's labor code. In court documents, CVS argued that Ms. Kilby was fired after eight months of employment for missing work and never requested a chair during her time there. Other courts have ruled in favor of seatless employees at Home Depot and 99 Cents Only. But the judge in the CVS case argued that the nature of CVS's cashier job doesn't "reasonably permit the use of a seat," according to court documents. CVS said it could not "maintain its commitment to excellent customer service" if cashiers sat rather than stood. Employees in office jobs, meanwhile, are choosing to stand. "Standing desks" have become the new trendy accessory in Silicon Valley offices, and advocates say they're better for workers health than traditional desks. DJSP ENTERPRISES: Ex-Shareholders File Revised Class Action ----------------------------------------------------------- Daily Business Review reports that former shareholders in foreclosure attorney David Stern's DJSP Enterprises have filed a more extensive version of a proposed class action that was dismissed last year by a federal judge. The new claims target Mr. Stern, DJSP -- Mr. Stern's back-office foreclosure processing operation -- and several former high-ranking DJSP executives. FACEBOOK INC: Alfred G. Yates Law Firm Files Class Action --------------------------------------------------------- The Law Office of Alfred G. Yates Jr., PC announced that it has filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of purchasers of Facebook, Inc. common stock pursuant and/or traceable to the Company's May 18, 2012 initial public offering. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Alfred G. Yates Jr., Esquire at 1-800-391- 5164, toll free, or at yateslaw@aol.com by e-mail. Please visit http://yatesclassactionlaw.comfor more information. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. If you wish to serve as lead plaintiff, you must move the Court no later than July 23, 2012. The complaint charges Facebook and certain of its officers and directors with violations of the Securities Act of 1933. On or about May 16, 2012, Facebook filed with the SEC a Form S-1/A Registration Statement for the IPO. On or about May 18, 2012, the Prospectus, which forms part of the Registration Statement, became effective and defendants sold 421 million shares of Facebook common stock to the public at $38 per share, for total proceeds of more than $16 billion. The complaint alleges that the Registration Statement and Prospectus issued in connection with the IPO were false and misleading in violation of the Securities Act. The complaint asserts that defendants failed to disclose that because Facebook was experiencing a pronounced reduction in revenue growth due to an increase of users of its Facebook app or Web site through mobile devices rather than traditional PCs, at the time of the IPO the Company had told the lead underwriters to reduce their 2012 performance estimates for Facebook. These revisions were material information which was not shared with all investors, but rather, was selectively disclosed by defendants to certain preferred investors and omitted from the Registration Statement and/or Prospectus. Plaintiffs seek to recover damages on behalf of all purchasers of Facebook common stock pursuant and/or traceable to the Company's IPO. FANNIE MAE: Oral Arguments on Motions for Summary Judgment Begin ---------------------------------------------------------------- According to an article posted by Zoe Tillman at The Blog of Legal Times, attorneys on both sides of a securities class action against Fannie Mae made their case on June 5 for summary judgment, with plaintiffs' counsel arguing that the mortgage giant clearly admitted to fraud and defense counsel arguing that the evidence proved Fannie Mae acted in good faith. Fannie Mae and its auditor, KPMG, were sued in 2005 by the attorney general of Ohio on behalf of that state's pension plans, after the federal agency regulating Fannie Mae found that the company had overstated profits and failed to comply with other generally accepted accounting principles. The plaintiffs have moved for summary judgment on Fannie Mae's liability for losses suffered by people who bought stock between 2001 and 2004. If U.S. District Judge Richard Leon rules in their favor, a jury would be tasked with deciding damages. The defendants have moved for summary judgment on the claims related to their accounting practices. If they win, Scott Fink -- sfink@gibsondunn.com -- of Gibson, Dunn & Crutcher told Judge Leon that the defense thought it would be a "case ender." W.B. "Bill" Markovitz -- billmarkovits@wsbclaw.com -- of Waite, Schneider, Bayless & Chesley acknowledged in his arguments on behalf of the plaintiffs' motion that it was unusual for plaintiffs to move for summary judgment on liability. Still, he said, it was appropriate because the evidence showed Fannie Mae had already admitted to the alleged fraud in its filings with the U.S. Securities and Exchange Commission and public statements made by Fannie Mae officials about its accounting problems. Mr. Markovitz focused on a 2006 report by former Senator Warren Rudman and Paul, Weiss, Rifkind, Wharton & Garrison, which found that Fannie Mae not only departed from generally accepted accounting principles, but also that officials did so to avoid making costly changes to its business model. He cited a public statement issued in 2006 by then-chairman of Fannie Mae's board of directors, Stephen Ashley, that the board "accepts and embraces" the report. Judge Leon pressed Mr. Markovitz on the issue of whether there was fraudulent intent, asking him why he should look to the report when Mr. Rudman wasn't tasked with deciding whether Fannie Mae had actually committed fraud. Mr. Markovitz said the report presented the elements of the fraud, even if Mr. Rudman didn't come to that formal conclusion. Robert Stern -- rstern@omm.com -- of O'Melveny & Myers, arguing against the plaintiffs' motion, said the voluminous case record, which included testimony from more than a hundred witnesses, trumped the plaintiffs' reliance on the Rudman report. The report was never formally adopted by the board, Mr. Stern said, meaning it wasn't an admission of liability by Fannie Mae. Mr. Stern argued that no witness testified that Fannie Mae officials knew they were acting contrary to generally accepted accounting principles at the time. If there was an error, he said, it was only that. "This simply is not the stuff of fraud," he said. Whether there was any evidence of fraudulent intent is also at the heart of the defendants' motion for summary judgment. Gibson Dunn's Mr. Fink, arguing on June 5 on behalf of the defendants, told Judge Leon that the case boiled down to a difference of opinion between Fannie Mae and the SEC over how to interpret the accounting regulations at issue. There was no evidence that Fannie Mae officials intentionally advocated an interpretation of those rules that they knew was wrong, he said. Mr. Fink argued that the regulations in question are extraordinarily complex and have been the subject of debate for years, and that the SEC even changed its own opinion on how to interpret them in 2007. It was the first of three days of oral arguments on motions for summary judgment in the case. The arguments involved the core joint motions filed by both sides, while most of the remaining motions involve individual defendants. HEARTLAND PAYMENT: Time to Appeal Class Settlement Order Open ------------------------------------------------------------- The time provided for parties to challenge a Texas court final approval order of a settlement resolving a customer class action against Heartland Payment Systems, Inc. is still open, according to the Company's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. On June 10, 2009, the Judicial Panel on Multidistrict Litigation entered an order centralizing the class action cases for pre-trial proceedings before the U.S. District Court for the Southern District of Texas, under the caption In re Heartland Payment Systems, Inc. Customer Data Security Breach Litigation, MDL No. 2046, 4:09-md-2046. On August 24, 2009, the court appointed interim co-lead and liaison counsel for the financial institution and consumer plaintiffs. On September 23, 2009, the financial institution plaintiffs filed a Master Complaint in the MDL proceedings, which the Company moved to dismiss on October 23, 2009. On December 1, 2011, the Court entered an order granting in part the Company's motion to dismiss the financial institution plaintiffs' master complaint against the Company, but allowing the plaintiffs leave to amend to re-plead certain claims. Plaintiffs' amended complaint was due on June 4, 2012 and a status conference will be set following the filing of the amended master complaint. On December 18, 2009, the Company and interim counsel for the consumer plaintiffs filed with the Court a proposed settlement agreement, subject to court approval, of the consumer class action claims. On May 3, 2010, the Court entered an order preliminarily certifying the settlement class, authorizing notice to the class to proceed, and scheduling a fairness hearing for December 10, 2010, which was later adjourned to December 13, 2010. On March 20, 2012, the Court issued a memorandum and opinion granting final approval to the settlement and on April 12, 2012, the Court entered a judgment. The time period for parties to appeal the Court's ruling has not yet expired. Based in Princeton, New Jersey, Heartland Payment Systems, Inc. -- http://www.heartlandpaymentsystems.com/-- provides bankcard payment processing services in the United States and Canada. It facilitates the exchange of information and funds between merchants and cardholder's financial institutions; and offers end- to-end electronic payment processing services, including merchant set-up and training, transaction authorization and electronic draft capture, clearing and settlement, merchant accounting, merchant assistance and support, and risk management to merchants. HILTON LAX: Settles Wage & Missed Breaks Class Action for $2.5MM ---------------------------------------------------------------- Jobmouse reports that one of LA's biggest hotels, The Hilton Los Angeles Airport Hotel, has settled a class action lawsuit and agreed to pay its workers $2.5 million. The class action lawsuit alleged that the hotel withheld wages, failed to pay overtime and failed to provide meal and rest breaks to about 1,200 hotel workers. The class action was filed in 2008 and covers all hourly workers who worked at the hotel from 2004 to 2011. "For years, we've felt like machines only here to make more and more money for the owners of the Hilton LAX," said Juan Banales, a Hilton LAX cook of almost 20 years. "This settlement is a huge victory. We've won justice and respect." Mr. Banales said he would receive about $3,800 from the lawsuit. "For years, I was unable to take breaks," Mr. Banales said. "The law says we have the right to take breaks. It's a shame we had to file a lawsuit to get the hotel to understand that." The suit also claimed that the hotel failed to pay employees for the time spent preparing for work and putting on and taking off work uniforms that were required to be left at the hotel. Further, plaintiffs alleged they were required to fill out time sheets saying they took breaks whether they truthfully did or not. "Since this lawsuit was filed, hundreds of workers at hotels near LAX have won union contracts that guarantee breaks and workers' right to negotiate fair wages and benefits," said Tom Walsh, President of UNITE HERE Local 11, the union representing 20,000 hospitality workers in Southern California. "Instead of choosing to respect workers, the Hilton LAX has taken the low road, fighting its own employees. I hope this expensive lawsuit teaches the Hilton LAX owners to respect the workers who make it successful." IDAHO: Tribe to Get $60 Million in Settlement Money --------------------------------------------------- The Associated Press reports that a Shoshone-Bannock Tribes official in eastern Idaho says $60 million in settlement money the tribe expects to receive as part of a class-action lawsuit will be distributed to about 5,700 tribal members. Public Affairs Manager Randy'L Teton tells KIFI-TV that the tribe is planning financial workshops once the distribution begins. Officials say it's unclear exactly how much each tribal member will receive, and the tribe itself has yet to receive the money. The settlement money is expected following the decision by a three-judge panel from the U.S. Court of Appeals for the District of Columbia who last month upheld a $3.4 billion settlement between the U.S. government and hundreds of thousands of Native American plaintiffs whose land trust royalties were mismanaged by the Interior Department. IMPERIAL TOBACCO: CEO Testifies in C$27BB Tobacco Class Action -------------------------------------------------------------- William Marsden, writing for The Montreal Gazette, reports that the president of Canada's largest tobacco manufacturer admitted on June 5 that all tobacco products are dangerous and none is comparatively safer than other brands. Marie Polet, president and CEO of Imperial Tobacco Canada, testified in Superior Court that even low-tar cigarettes are as risky as other brands. "We are selling a product that is a product that can cause serious and in some cases fatal diseases, and it is a product that we have to manage very responsibly," she said. She is testifying at the C$27-billion class-action tobacco lawsuit launched by 1.8 million Quebec smokers against Canada's three major tobacco companies. The plaintiffs allege they have become seriously ill because of smoking and have been unable to quit. Ms. Polet, a native of Germany, has been in the tobacco marketing business for more than 30 years and last November became the chief executive of Imperial Tobacco. She claimed in her testimony that she was unaware of what happened at Imperial before her arrival even though she had worked for many years for Imperial's owner, British American Tobacco. Under questioning from lawyer Bruce Johnston, acting for the plaintiffs, Ms. Polet testified that it is "part of our fundamental principles" at Imperial Tobacco not to market products to people under 18 and not to try to persuade non-smokers to smoke. "We do not want to convince anyone who is a non-smoker to start smoking," she said. She said Imperial's marketing is designed only to take market share away from its competitors. "Our business is about creating value for our shareholders and our business is about taking away share from our competition," she said. "It is not about convincing anybody to start smoking, whether young or older." She said that nobody in the tobacco business wants to expand the market. At the same time, she claimed that smoking "adds value" to smokers' lives. "I believe it does add value to our consumers," she said. "Consumers must be adults. They must be clearly informed about the risks. Given those conditions, I believe that a lot of smokers in Canada and around the world do enjoy smoking." She also testified that Imperial does not conduct market research on young people. However, documents indicate that Imperial Tobacco began targeting young people between 15 and 19 years old in 1975 with marketing campaigns. One Imperial document dated 1975 and titled "Du Maurier and Young People", has a section headed "Some Hypotheses About How to Best Appeal to Young People." It then lists 11 suggestions. These include showing "a male and female couple associated with a particular activity" and the "couple should be left shadowy and in the background so that there are no discernible clues to their looks, or age." The activity should "provide an undercurrent of excitement" and should appeal to "young people (particularly boys)." "The activity itself should result in the impression of a peaceful, tranquil, 'free' sort of feeling, not a hard, frenetic, sweaty, tiresome sort of feeling (thus sailing would be better than motor boat racing, bicycling better than jogging, etc.)," the document states. Other marketing documents indicate that tobacco companies followed what they called "starters," or new smokers, as well as "switchers," defined as smokers who had changed to another brand. JP MORGAN: Settles Bid-Rigging Class Action Suit for $44MM ---------------------------------------------------------- Dow Jones Newswires reports that J.P. Morgan Securities has agreed to pay up to $44.6 million to resolve claims from municipalities that it conspired to fix prices and rig bids for municipal derivatives, becoming the latest bank to settle the class-action civil suit. U.S. District Judge Victor Marrero in New York approved the settlement terms late on June 4. He scheduled a hearing on Dec. 14 to consider final approval. The city of Baltimore, the Mississippi Department of Transportation and five other public entities sued a group of banks on behalf of other cities, universities and special districts, accusing the banks of rigging bids to provide services to municipalities. Morgan Stanley and Wachovia Bank previously settled, court documents said. The civil suit is in addition to charges levied against J.P. Morgan by the U.S. Securities and Exchange Commission and other federal and state authorities. UBS Financial Services, Banc of America Securities, GE Funding Capital Market Services, Wachovia and J.P. Morgan, have agreed to settle those charges for more than $700 million in total, according to the SEC. "It shows that it is possible to have a dual resolution where state and private recoveries are complementary," said Michael Hausfeld -- mhausfeld@hausfeldllp.com -- co-lead attorney for the municipalities. The allegations involve bidding and pricing for various investment products, which municipalities use to reinvest proceeds from municipal-bond sales that are not immediately needed, according to the SEC. Proceeds of tax-exempt municipal bonds must be invested at fair market value, and the most common way to do so is through a competitive bidding process. According to the SEC, J.P. Morgan at times won bids because it obtained information from the bidding agents about competing bids. Other times, the bidding agent deliberately obtained non-winning bids from other providers, allowing the bank to essentially win in advance. The municipalities alleged they received lower interest rates than they would have received otherwise. "Anytime that you have collusion in the financial markets, it means that purchasers or investors are going to be cheated," Mr. Hausfeld said. Other banks have not yet settled the class-action case, Mr. Hausfeld said. A representative for J.P. Morgan declined to comment. KNOLOGY INC: Shareholders Sue Over Proposed WideOpenWest Sale ------------------------------------------------------------- Courthouse News Service reports that Knology is selling itself too cheaply through a "tainted process" to WideOpenWest Finance, for $19.75 a share or $1.5 billion, shareholders say in a class action in Chancery Court. A copy of the Complaint in Lewis v. Johnson, et al., Case No. 7592 (Del. Ch. Ct.), is available at: http://www.courthousenews.com/2012/06/06/SCA.pdf The Plaintiff is represented by: Brian D. Long, Esq. Seth D. Rigrodsky, Esq. Gina M. Serra, Esq. RIGRODSKY & LONG, P.A. 919 North Market Street, Suite 980 Wilmington, DE 19801 Telephone: (302) 295-5310 E-mail: sdr@rigrodskylong.com bdl@rigrodskylong.com gs@rigrodskylong.com - and - Shannon L. Hopkins, Esq. Allen Schwartz, Esq. LEVI & KORSINSKY LLP 30 Broad Street, 24th Floor New York, NY 10004 Telephone: (212) 363-7500 KRAFT FOODS: Faces Wage and Hour Violations Suit in California -------------------------------------------------------------- Gilbert Salinas, individually, and on behalf of all others similarly situated v. Kraft Foods Global, Inc., and Does 1 through 100, inclusive, Case No. CGC-12-520292 (Calif. Super. Ct., San Francisco Cty., April 25, 2012) is brought on behalf of all similarly situated persons, who are or were employed as a Route Salesperson by Kraft Foods in the state of California within the applicable class period designated as from April 25, 2008, through the date of trial. The Plaintiff seeks unpaid wages, including unpaid overtime compensation, compensation for missed meal and rest periods interest thereon and other penalties, injunctive and other equitable relief, and reasonable attorneys' fees and costs. The Plaintiff alleges that during the Class Period, Kraft Foods has had a consistent policy of, among other things, permitting, encouraging and requiring its allegedly overtime-exempt salaried route salespersons to work in excess of eight hours per day and in excess of forty hours per week without paying them overtime compensation as required by California's wage and hour lawsuit. During the Class Period, Mr. Salinas was employed by the Defendants as a route salesperson at one or more of their California locations. Kraft Foods is a corporation doing business in the county of San Francisco, California. Kraft Foods is purportedly the second largest food company in the world with annual revenues of over forty-nine billion dollars. Kraft Foods operates numerous manufacturing facilities worldwide and in California, including the one in which the Plaintiff worked as a route salesperson. The Plaintiff is currently unaware of the true names and capacities of the Doe Defendants. Kraft Foods removed the lawsuit on June 4, 2012, from the Superior Court of the state of California, County of San Francisco, to the United States District Court for the Northern District of California. The Company argues that the removal is proper because the District Court has original jurisdiction over this case in that it is a civil action filed as a class action wherein the matter in controversy exceeds the sum of $5 million, exclusive of interest and costs. The District Court Clerk assigned Case No. 4:12-cv-02894 to the proceeding. The Plaintiff is represented by: Matthew R. Bainer, Esq. Hannah R. Salassi, Esq. SCOTT COLE & ASSOCIATES, APC 1970 Broadway, Ninth Floor Oakland, CA 94612 Telephone: (510) 891-9800 Facsimile: (510) 891-7030 E-mail: mbainer@scalaw.com hsalassi@scalaw.com The Defendants are represented by: Douglas J. Farmer, Esq. Michael J. Nader, Esq. Christopher M. Ahearn, Esq. OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Steuart Tower, Suite 1300 One Market Plaza San Francisco, CA 94105 Telephone: (415) 442-4810 Facsimile: (415) 442-4870 E-mail: douglas.farmer@ogletreedeakins.com michael.nader@ogletreedeakins.com chris.ahearn@ogletreedeakins.com LOS ANGELES, CA: LAPD Sued Over Discriminatory Arrests ------------------------------------------------------ Matt Reynolds at Courthouse News Service reports that the Los Angeles Police Department unconstitutionally uses decoys to arrest gay men for the bogus crime of soliciting "nonmonetary intimate association with other men," a man claims in a federal class action. Eric St. Mark Christie seeks to represent a class of men "arrested for soliciting or engaging in lewd conduct by Los Angeles Police acting as decoys." Mr. Christie claims the LAPD targets the men because "they are perceived to be interested in meeting, in public, men interested in nonmonetary intimate association with other men." Mr. Christie says he was arrested after he unwittingly solicited an undercover cop. He claims the LAPD has a "policy and custom" of sending decoys into areas where men solicit sex from one another, and that this policy violates constitutional guarantees of free speech, equal protection, and protection from search and seizure. He sued the City of Los Angeles, Chief Charlie Beck and the four officers who allegedly arrested him in Hollenbeck Park on May 6, 2011. Mr. Christie says that on that day he encountered a male plainclothes officer who "pretended to be sexually interested" in him. "After a short conversation, the two adults agreed to engage in oral sex to take place inside a totally enclosed restroom stall whose door could be locked from the inside," according to the complaint. Mr. Christie says the decoy-cop signaled to his three fellow officers to initiate an arrest, though Mr. Christie had not broken any law, and the agreement to have sex in a stall was a "legal solicitation." As the plainclothes officers moved in, Mr. Christie says, he "ran in terror" believing he was about to be mugged. He claims the cops ran him down and assaulted him. "(T)he LAPD never arrest men by women decoy officers for nonmonetary sexual solicitations nor do they arrest women by male decoy officers for nonmonetary sexual solicitations," the complaint states. Mr. Christie says criminal charges against him were dropped in April. He seeks a jury trial, an injunction and class damages for excessive force, discriminatory arrest, false arrest and conspiracy. The LAPD declined to comment. A copy of the Complaint in Christie v. City of Los Angeles, et al., Case No. 12-cv-04866 (C.D. Calif.), is available at: http://www.courthousenews.com/2012/06/06/Decoys.pdf The Plaintiffs are represented by: Bruce W. Nickerson, Esq. 231 Manor Drive San Carlos, CA 94070 Telephone: (650) 594-0195 E-mail: brucenic@pacbell.net MAXIMUM RETURN: Smidi Must Pay $5.6MM in Alleged Ponzi Scheme ------------------------------------------------------------- Jon Burstein, writing for Sun Sentinel, reports that a traveling yoga teacher must pay federal authorities almost $5.6 million for her role in an alleged Ponzi scheme out of Plantation that raked in more than $30 million from investors. Zeina "Zeeluv" Smidi, who tours the country in a bus fueled by vegetable oil, had the multimillion-dollar judgment entered against her in Fort Lauderdale federal court. Ms. Smidi and her former fiance, James Clements, once ran a group of companies under the names MRT or Maximum Return Transactions that the U.S. Securities and Exchange Commission alleged served as fronts for an investment fraud involving foreign currency trading. Ms. Smidi, 31, and Clements, 50, have been accused by SEC lawyers of moving about $3 million of investors' money to their personal bank accounts and using another $3 million for travel, luxury items and other expenses. In one three-week span, money from an MRT account was used to pay for $8,000 in NFL tickets, meals at ski resorts in Vermont and Colorado, and hotel reservations in Las Vegas, bank records show. Ms. Smidi must pay $2.5 million in profits she made, $2.5 million in civil penalties and another $600,000 in interest, U.S. District Judge William Dimitrouleas ordered May 21 in the SEC civil case against her. In a separate judgment, Mr. Clements was ordered to pay $768,000 to the SEC. The attorney for Mr. Clements and Ms. Smidi said that they have done everything they can to help clients recover their money, and that allegations they used the funds to support an extravagant lifestyle are not true. "The [SEC] case is resolved," said Inger Garcia, their attorney. "I'd love to comment, but I can't on certain issues." Mr. Clements testified at a June 2008 court hearing that he had "nothing to be ashamed of" and had made no guarantees to clients. The U.S. Attorney's Office sent letters in March 2010 to Mr. Clements and Ms. Smidi informing them that they were targets of a criminal investigation. The status of that inquiry was unclear on June 1. That frustrates MRT clients such as Nyra Horowitz, 75, a Boynton Beach widow who lost $140,000 to the company. "That's what gets me -- they still walk the streets," Ms. Horowitz said. "In the meantime, I haven't seen one nickel." Mr. Clements and Ms. Smidi ran MRT from 2005 until the summer of 2007, first promising investors high returns from foreign currency trading and then saying the company was investing in high-yield overseas products, according to the SEC lawsuit. Less than $3 million was used for currency trading, while old investors were paid with new investors' money, federal authorities said. Besides the judgments in the SEC case, Mr. Clements and Ms. Smidi are on the hook for a $50 million judgment entered against them in a class-action lawsuit filed by MRT investors. Jeffrey Sonn, the attorney who brought the class-action case, said that by all indications Clements headed MRT while Ms. Smidi filled a role analogous to a chief operations officer. He said that there have been some small recoveries of investors' money, but the MRT bank accounts had been emptied and there were no visible assets by the time the class-action suit was brought. NATIONWIDE COIN: Sued in California for False Advertising --------------------------------------------------------- Courthouse News Service reports that Nationwide Coin & Bullion Reserve, of Houston, falsely claims a relationship with the federal government to sell "$5 Gold American Eagles" for $172 apiece, with a five-coin minimum, a class action claims in Federal Court. A copy of the Complaint in Bayonne v. Nationwide Coin & Bullion Reserve, Inc., et al., Case No. 12-cv-04900 (C.D. Calif.), is available at: http://www.courthousenews.com/2012/06/06/CCA.pdf The Plaintiff is represented by: Scott J. Ferrell, Esq. James B. Hardin, Esq. Victoria C. Knowles, Esq. NEWPORT TRIAL GROUP 895 Dove Street, Suite 425 Newport Beach, CA 92660 Telephone: (949) 706-6464 E-mail: sferrell@trialnewport.com jhardin@trialnewport.com vknowles@trialnewport.com PHOENIX COMPANIES: Awaits Updates on Tiptree-Related Suit --------------------------------------------------------- The Phoenix Companies is awaiting developments in the case titled Carol Curran, et al. v. AGL Life Assurance Co. et al., according to Phoenix's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. On January 4, 2010, the Company signed a definitive agreement to sell PFG Holdings Inc. and its subsidiaries, including AGL Life Assurance Company, to Tiptree. Because of the divestiture, these operations are reflected as discontinued operations. On June 23, 2010, the Company completed the divestiture of PFG and closed the transaction. The definitive agreement contains a provision requiring the Company to indemnify Tiptree for any losses due to actions resulting from certain specified acts or omissions associated with the divested business prior to closing. The Curran case was filed in the state district court in Boulder County, Colorado that falls under the indemnification with Tiptree. The Company is not a party to the lawsuit. On August 8, 2011, the state district court judge certified a class action. On October 18, 2011, the Colorado Supreme Court granted defendants' petition to determine whether the Securities Litigation Uniform Standards Act deprives the state court of jurisdiction of the class action as certified and issued a stay of the state court proceedings. On January 17, 2012, the Colorado Supreme Court dismissed the appeal without reaching the merits. The trial court proceedings will now continue. The outcome of this litigation is uncertain and the amount of potential loss in the event of an adverse outcome cannot be estimated. Based in Hartford, Connecticut, The Phoenix Companies, Inc. -- http://www.phoenixwm.com/-- through its subsidiaries, provides life insurance and annuity products through independent agents and financial advisors in the United States. Its subsidiaries include Phoenix Life Insurance Agency and PHIL Variable Insurance Company. SOUNDBITE COMMUNICATIONS: Defends Against Sager Litigation ---------------------------------------------------------- Soundbite Communications Inc. continues to defend itself against a complaint referred to as the Sager Litigation, according to the Company's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. On January 11, 2012, a class action litigation, which the Company refers to as the Sager Litigation, was filed against Bank of America and the Company as co-defendants. The Sager Litigation alleges that the Company and Bank of America sent text messages to the plaintiff without the plaintiff's prior express consent, in violation of the U.S. Telephone Consumer Protection Act or TCPA. Plaintiff is seeking confirmation of a class of individuals who received unauthorized text message solicitations from the Company. The Company's response to the complaint in the Sager Litigation was due on May 7, 2012. The Company intends to defend vigorously against the claims in the Sager Litigation that allege it violated provisions of the TCPA in delivering text messages. The Company is continuing to investigate this matter. At this time, it is not possible for the Company to estimate the amount of damages, losses, fees and other expenses that it will incur as the result of the Sager Litigation, but such an amount could have a material adverse effect on its business, financial condition and operating results. Even if the Company succeeds in defending against the Sager Litigation, it is likely to incur substantial costs and management's attention will be diverted from its operations. SoundBite Communications, Inc. -- http://soundbite.com/-- is a global provider of cloud-based, multi-channel proactive customer communications solutions designed to transform the way organizations communicate throughout the customer lifecycle to build trusted, lifelong and profitable relationships. SOUNDBITE COMMUNICATIONS: Sued Over Antitrust Violations -------------------------------------------------------- Soundbite Communications Inc. has been sued in two class action complaints alleging antitrust violations relating to its acquisition of 2ergos Americas, according to the Company's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. In February 2012, the Company acquired 2ergos Americas, a provider of mobile business and marketing solutions. The Company has just begun the process of integrating the operations, technology and personnel of 2ergo Americas. It expects the process will be more complex than in its previous acquisitions due to the need to integrate elements of the 2ergo Americas software platform with its platforms and to the complexities likely to be involved in addressing certain technologies previously shared by 2ergo Americas and its parent. The Company acquired 2ergo Americas in order to broaden its client base and gain technology and personnel, and it will be unable to recognize the anticipated benefits of the acquisition if it is unable to integrate the acquired technology effectively in a timely manner or if it fails fail to maintain and incentivize the former 2ergo Americas employees in a manner that enables it to maintain existing clients and add additional mobile marketing clients. On April 5, 2012, a class action litigation, which the Company refers to as the "Club Texting Litigation," was filed against numerous defendants, including the Company. On April 6, 2012, a related class action litigation, which the Company refers to as the "TextPower Litigation," was filed against numerous defendants, including the Company. In both the Club Texting Litigation and the TextPower Litigation, the Company is named as successor-in- interest to 2ergos Americas, which the Company acquired in February 2012. Both the Club Texting Litigation and the TextPower Litigation allege that the named mobile telecom companies and aggregators violated antitrust provisions set forth in the Sherman Act through the use of various common short code requirements related to the sending of text messages by businesses to consumers. Further, both the Club Texting Litigation and the TextPower Litigation are seeking confirmation of a class of entities and persons who leased a common short code from Neustar, Inc. and sent or received text messages through one or more aggregators. All of the alleged violations occurred prior to the Company's acquisition of 2ergo Americas, and the Company has served an indemnification claim on 2ergo Group plc, the former parent company of 2ergo Americas, in relation to both the Club Texting Litigation and the TextPower Litigation. In connection with the acquisition, $750,000 was deposited in an escrow account to secure claims by the Company for breaches of representations and warranties made with respect to 2ergo Americas. The Company intends to defend vigorously against the claims in the Club Texting Litigation and the TextPower Litigation that allege violations of the Sherman Act. At this time it is not possible for the Company to estimate the amount of damages, losses, fees and other expenses that it will incur as the result of the Club Texting Litigation or the TextPower Litigation, but such an amount could have a material adverse effect on its business, financial condition and operating results. Even if the Company succeeds in defending against the Club Texting Litigation and the TextPower Litigation, it is likely to incur substantial costs and management's attention will be diverted from its operations. SoundBite Communications, Inc. -- http://soundbite.com/-- is a global provider of cloud-based, multi-channel proactive customer communications solutions designed to transform the way organizations communicate throughout the customer lifecycle to build trusted, lifelong and profitable relationships. TD AMERITRADE: Pleas to Dismiss Suit Over Yield Plus Fund Pending ----------------------------------------------------------------- Motions to dismiss a securities class action complaint against TD Ameritrade Holding Corporation relating to the Yield Plus Fund remain pending, according to the Company's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. In November 2008, a purported class action lawsuit was filed with respect to the Yield Plus Fund. The lawsuit is captioned Ross v. Reserve Management Company, Inc. et al., and is pending in the U.S. District Court for the Southern District of New York. The Ross lawsuit is on behalf of persons who purchased shares of Reserve Yield Plus Fund. On November 20, 2009, the plaintiffs filed a first amended complaint naming as defendants the fund's advisor, certain of its affiliates and the Company and certain of its directors, officers and shareholders as alleged control persons. The complaint alleges claims of violations of the federal securities laws and other claims based on allegations that false and misleading statements and omissions were made in the Reserve Yield Plus Fund prospectuses and in other statements regarding the fund. The complaint seeks an unspecified amount of compensatory damages including interest, attorneys' fees, rescission, exemplary damages and equitable relief. On January 19, 2010, the defendants submitted motions to dismiss the complaint. The motions are pending. Based in Omaha, Nebraska, TD Ameritrade Holding Corporation -- http://www.ameritrade.com/-- through its subsidiaries, provides securities brokerage services and technology-based financial services to retail investors, traders, and independent registered investment advisors (RIAs) in the United States. TREX CO: Class Suit Over Mold Growth Pending in Calif. ------------------------------------------------------ A consolidated lawsuit against Trex Co Inc. over allegations of mold growth remains pending in California, according to the Company's May 7, 2012, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2012. 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 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 U.S. District Court, Northern District of California. On January 21, 2009, a purported class action case was commenced against the Company in the U.S. District Court, Western District of Washington by the law firm of Hagens Berman Sobol Shapiro LLP 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 U.S. 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 the case. The Company believes that these claims are without merit, and will vigorously defend this lawsuit. Headquartered in Winchester, Virginia, Trex Company, Inc. -- http://www.trex.com/-- manufactures and distributes wood/plastic composite products, and related accessories primarily for the residential and commercial decking and railing applications in the United States. WEST MARINE: Recalls 1,200 Folding Chairs Due to Collapse Hazard ---------------------------------------------------------------- The U.S. Consumer Product Safety Commission, in cooperation with West Marine Products Inc., of Watsonville, California, announced a voluntary recall of about 1,200 units of folding deck chair. Consumers should stop using recalled products immediately unless otherwise instructed. It is illegal to resell or attempt to resell a recalled consumer product. The chair cannot support the stated weight capacity. This poses a collapse hazard to consumers. West Marine is aware of six incidents of the chair collapsing. No injuries were reported. The recalled item is a West Marine Deluxe Deck Chair. It is a folding deck chair with metal legs and light-colored wood armrests. It has plastic feet on the corners of each leg. The seat and back are covered with blue and gray nylon fabric. The back can be adjusted to various angles. Model/SKU number "13110341" is printed on a coated paper tag attached to the chair frame. A picture of the recalled products is available at: http://www.cpsc.gov/cpscpub/prerel/prhtml12/12193.html The recalled products were manufactured in China and sold exclusively at West Marine stores nationwide, online at westmarine.com and in the West Marine catalog from February 2012 to May 2012 for about $70. Consumers should immediately stop using the deck chairs and call West Marine for a full refund or store credit. Consumers may also return the chairs to any West Marine store to receive the refund or store credit. For additional information, please contact West Marine toll-free at (800) 262-8464 between 8:00 a.m. and 5:00 p.m. Pacific Time Monday through Friday, or visit the firm's Web site at http://www.westmarine.com/ WHOLE FOODS: Obtains Favorable Ruling in Antitrust Class Action --------------------------------------------------------------- The National Law Journal reports that the plaintiff in a civil antitrust lawsuit against Whole Foods Market over its merger with Wild Oats has agreed to judgment in favor of the company, following a decision in April by the D.C. Circuit not to hear an appeal of an order denying class certification. ZONEPERFECT NUTRITION: Sued Over "All Natural" Nutrition Bars ------------------------------------------------------------- James Colucci and Kimberly S. Sethavanish, on behalf of themselves and all others similarly situated v. ZonePerfect Nutrition Company, a Delaware corporation, Case No. SCV-251556 (Calif. Super. Ct., Sonoma Cty., April 26, 2012) is a class action on behalf of Plaintiffs and a nationwide class of consumers, who, from September 14, 2007, through the present, purchased ZonePerfect's Nutrition Bars, which are labeled, marketed and sold as being "All Natural" even though each bar contained between six and nine of these artificial and synthetic ingredients: Ascorbic Acid, Calcium Pantothenate, Calcium Phosphate, Glycerine, Potassium Carbonate, Pyridoxine Hydrochloride, Disodium Phosphate, Sorbitan Monostearale, Tocopherols and/or Xanthan Gum. Throughout the Class Period, ZonePerfect prominently made the claim "All Natural" on the labels of its Nutrition Bars, cultivating a wholesome and healthful image in an effort to promote the sale of these products, even though its Nutrition Bars were actually not "All Natural," the Plaintiff contends. They add that while the "All Natural" Nutrition Bars' labels did disclose that they contained Ascorbic Acid, et al., the labels did not disclose that these ingredients were artificial or synthetic. The Plaintiff has been a resident of Windsor, California, since December 2010. Prior thereto, Mr. Colucci actively served in the United States Marine Corps and was stationed in Camp Pendleton in San Diego County, California. From September 2009 through April 2010, he was deployed as part of his service with the Marines, and during that time, he asked Ms. Sethavanish to purchase two multi- bar packs of ZonePerfect Nutrition Bars per month, including its Classic ZonePerfect "All-Natural" Nutrition Bars Chocolate Peanut Butter flavor, to include in the packages that she sent him on a monthly basis. ZonePerfect is a Delaware corporation based in Abbott Park, Illinois. ZonePerfect manufactures, distributes and sells nutrition bars through walk-in and online retailers. ZonePerfect has operated as a subsidiary of Abbott Laboratories. ZonePerfect removed the lawsuit on June 5, 2012, from the Superior Court of the state of California, County of Sonoma, to the United States District Court for the Northern District of California. The Company argues that the removal is proper because the lawsuit asserts a cause of action arising under federal law. The District Court Clerk assigned Case No. 3:12-cv-02907 to the proceeding. The Plaintiffs are represented by: Janet Lindner Spielberg, Esq. LAW OFFICES OF JANET LINDNER SPIELBERG 12400 Wilshire Boulevard, #400 Los Angeles, CA 90025 Telephone: (310) 392-8801 Facsimile: (310) 278-5938 E-mail: llspielberg@jlslp.com - and - Michael D. Braun, Esq. BRAUN LAW GROUP, P.C. 10680 West Pico Boulevard, Suite 280 Los Angeles, CA 90064 Telephone: (310) 836-6000 Facsimile: (310) 836-6010 E-mail: service@braunlawgroup.com - and - Joseph N. Kravec, Jr., Esq. Wyatt A. Lison, Esq. Maureen Davidson-Welling, Esq. STEMBER FEINSTEIN DOYLE PAYNE & KRAVEC, LLC Allegheny Building, 17th Floor 429 Forbes Avenue Pittsburgh, PA 15219 Telephone: (412) 281-8400 Facsimile: (412) 281-1007 E-mail: jkravec@stemberfeinstein.com wlison@stemberfeinstein.com mdavidsonwelling@stemberfeinstein.com The Defendant is represented by: Elizabeth L. Deeley, Esq. KIRKLAND & ELLIS LLP 555 California Street San Francisco, CA 94104 Telephone: (415) 439-1400 Facsimile: (415) 439-1500 E-mail: elizabeth.deeley@kirkland.com - and - Gregg F. LoCascio, P.C., Esq. Jonathan D. Brightbill, Esq. Dennis J. Abdelnour, Esq. KIRKLAND & ELLIS LLP 655 Fifteenth Street, N.W. Washington, D.C. 20005 Telephone: (202) 879-5000 Facsimile: (202) 879-5200 E-mail: glocascio@kirkland.com jbrightbill@kirkland.com dabdelnour@kirkland.com ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. 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. 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