/raid1/www/Hosts/bankrupt/CAR_Public/121004.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, October 4, 2012, Vol. 14, No. 197
Headlines
A123 SYSTEMS: Continues to Defend Securities Suit in Mass.
ALLSCRIPTS HEALTHCARE: Lead Plaintiff Appointment Motion Pending
ALLSCRIPTS HEALTHCARE: Discovery in "Physicians" Suit Stayed
ALLSCRIPTS HEALTHCARE: Obtains Final OK of Stockholder Suit Deal
AMERICAN NATIONAL: "Basham" Suit Remanded to Ark. State Court
BAYER CORP: Settles One-A-Day Vitamin False Advertising Class Suit
BP: Plaintiffs Wants Oil Spill Settlement Deadline Extended
BRE-X MINERALS: Bankruptcy Trustees Seek to Dismiss Investors Suit
BRIGHT HOUSE: Sued for Retaining Consumers' Personal Information
CARFAX INC: February 21 Settlement Fairness Hearing Set
CHASE HOME: Judge Dismisses Truth-In-Lending Class Action
CHINA AUTOMOTIVE: Court Denies Securities Suit Dismissal Bid
CIT GROUP: Obtained Final Approval of Securities Suit Settlement
COHEN MCNEILE: Judge Tosses Debt Collection Class Action
COSTCO WHOLESALE: Loses Bid to Dismiss Gender Bias Class Action
DALE AND THOMAS: Recalls Bags of Various Popcorn Products
FANNIE MAE: Sherburne County Joins Deed Tax Class Action
FIRST ALARM: Blumenthal, Nordrehaug & Bhowmik Files Class Action
FORD MOTOR: Faces Class Action Over Non-Flat Towable Vehicles
FREDDIE MAC: Judge Tosses Civil Securities Fraud Class Action
GENON ENERGY: Appeals in Natural Gas Prices Suit Remain Pending
GENON ENERGY: Faces Shareholder Suits Over Proposed NRG Merger
GENON ENERGY: Removed Plant Emissions Suit to Penn. Dist. Ct.
GMX RESOURCES: Responses to Oklahoma Suit to Be Filed Late 2012
GROUPON INC: Judge Rejects $8.5-Mil. Class Action Settlement
HOUSTON AMERICAN: Continues to Defend "Silverman" Class Suit
INDIANA: Dental Services Monetary Cap Class Action Ruling Upheld
LOCAL.COM CORP: "Bernstein" Class Action Suit Dismissed in May
MI WINDOWS: Sues Insurers for Class Action Coverage
PELLA CORP: Seeks to Thwart Class Action Settlement Talks
RELIANT ENERGY: Nevada Loses Natural Gas Class Action Bid
SHAW GROUP: Sued Over Proposed Chicago Bridge & Iron Merger
SKECHERS USA: "Stalker" Plaintiff Awaits Ruling on Grabowski Deal
SKECHERS USA: Class Certification Bid in "Lovston" Suit Pending
SKECHERS USA: "Hochberg" Suit Transferred to Toning Shoes MDL
SKECHERS USA: Judge Has Yet to Be Assigned in "Angell" Class Suit
SKECHERS USA: "Loss" and "Boatright" Suits Consolidated in July
SKECHERS USA: "Scovil" Suit Transferred to Toning Shoes MDL
SKECHERS USA: "Tomlinson" Class Suit Remains Stayed in Arkansas
STORM FIN'L: Two Banks Deny Involvement in Investment Scheme
SUN DRILLING: Faces Class Action Over Release of Toxic Substances
*********
A123 SYSTEMS: Continues to Defend Securities Suit in Mass.
----------------------------------------------------------
A123 Systems, Inc. continues to defend itself against a
consolidated securities class action lawsuit pending in
Massachusetts, according to the Company's August 9, 2012, Form 10-
Q filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2012.
On April 2, 2012, a complaint was filed in the United States
District Court for the District of Massachusetts by Scott Heiss,
purportedly acting individually and on behalf of other similarly
situated persons, against the Company and its CEO, David Vieau,
its CFO, David Prystash, and its former Interim CFO, John Granara.
The complaint followed the Company's disclosure in March 2012 of
potentially defective prismatic cells used in battery packs and a
replacement program for such cells. The complaint attempts to
allege that certain of the Company's disclosures were inaccurate
because the potentially defective cells and their replacement were
not disclosed earlier. The complaint asserts a claim under
Section 10(b) of the Securities Exchange Act of 1934 against the
Company and claims under Sections 10(b) and 20(a) of that statute
against the individuals. It asserts a purported class period from
February 28, 2011, through March 23, 2012.
On April 12, 2012, a similar complaint was filed in the United
States District Court for the District of Massachusetts by Terry
Leon Fike, purportedly acting individually and on behalf of other
similarly situated persons, against the same defendants. The
complaint makes similar allegations and also asserts claims under
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and a purported class period from February 28, 2011, through March
23, 2012. On June 7, 2012, the Court consolidated the two cases
and appointed a lead plaintiff and lead counsel for the asserted
class. No substantive response has been required at this time.
ALLSCRIPTS HEALTHCARE: Lead Plaintiff Appointment Motion Pending
----------------------------------------------------------------
Allscripts Healthcare Solutions, Inc. is awaiting court decisions
on plaintiffs' motions for appointment as lead plaintiff and for
appointment as lead plaintiff's counsel in the securities class
action lawsuit pending in Illinois, according to the Company's
August 9, 2012, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2012.
On May 2, 2012, a lawsuit was filed in the United States District
Court for the Northern District of Illinois against the Company,
Glen Tullman and William Davis, the former Chief Financial Officer
of the Company, by the Bristol County Retirement System for itself
and on behalf of a purported class consisting of stockholders who
purchased Allscripts common stock between November 18, 2010, and
April 26, 2012. The Complaint alleges that the Company, Mr.
Tullman and Mr. Davis made materially false and misleading
statements and/or omissions during the putative class period
regarding the Company's progress in integrating Allscripts' and
Eclipsys Corporation's business following the August 24, 2010
merger and that the Company lacked a reasonable basis for certain
statements regarding the Company's post-merger integration
efforts, operations, results and projections of future financial
performance. Two groups of plaintiffs have filed motions for
appointment as lead plaintiff and for appointment as lead
plaintiff's counsel. These motions were fully briefed as of July
31, 2012. Defendants' time to answer or otherwise plead is stayed
pending appointment of lead plaintiff and lead plaintiffs'
counsel. The Company intends to vigorously defend against these
claims.
Allscripts Healthcare Solutions, Inc., is a provider of clinical,
financial, connectivity and information solutions and related
professional services that empower hospitals, physicians and post-
acute organizations to deliver world-class outcomes. Its
businesses deliver innovative solutions that provide physicians
and other healthcare professionals with just-right, just-in-time
information, connect them to each other and to the entire
community of care, and transform healthcare by improving the
quality and efficiency of patient care. The Company is based in
Chicago, Illinois.
ALLSCRIPTS HEALTHCARE: Discovery in "Physicians" Suit Stayed
------------------------------------------------------------
Discovery in the class action lawsuit commenced by Physicians
Healthsource, Inc. has been stayed pending a decision on a similar
case, according to Allscripts Healthcare Solutions, Inc.'s August
9, 2012, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2012.
On May 1, 2012, Physicians Healthsource, Inc. (hereinafter
"Plaintiff") filed a class action Complaint in U.S. District Court
for the Northern District of Illinois against Allscripts-Misys
Healthcare Solutions Inc., Allscripts, LLC and Allscripts
Healthcare Solutions, Inc. ("Allscripts"). The Complaint alleges
that on multiple occasions between July 2008 and December 2011,
Allscripts or its agent sent advertisements by fax to the
Plaintiff and a class of similarly situated persons, without first
receiving the recipients' express permission or invitation in
violation of the Telephone Consumer Protection Act, 47 U.S.C.
Section 227 ("TCPA"). The Complaint seeks $500 for each alleged
violation of the TCPA, treble damages if the Court finds the
violations to be willful, knowing or intentional, and injunctive
and other relief. Allscripts was served with the Complaint and
Plaintiff's Motion for Class Certification on May 7, 2012, and the
Company responded by filing a Motion to Dismiss. Discovery in
this matter has been stayed pending a decision of the 7th Circuit
Court of Appeals in the case of Holtzman v. Turza, which involves
issues raised in the Company's Motion. The Company has also filed
a Motion requesting denial of Plaintiff's Motion for Class
certification. The Company intends to vigorously defend against
these claims.
Allscripts Healthcare Solutions, Inc., is a provider of clinical,
financial, connectivity and information solutions and related
professional services that empower hospitals, physicians and post-
acute organizations to deliver world-class outcomes. Its
businesses deliver innovative solutions that provide physicians
and other healthcare professionals with just-right, just-in-time
information, connect them to each other and to the entire
community of care, and transform healthcare by improving the
quality and efficiency of patient care. The Company is based in
Chicago, Illinois.
ALLSCRIPTS HEALTHCARE: Obtains Final OK of Stockholder Suit Deal
----------------------------------------------------------------
Allscripts Healthcare Solutions, Inc. received in July 2012 final
approval of its $10 million settlement of a stockholder class
action lawsuit, according to the Company's August 9, 2012, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2012.
On August 4, 2009, a lawsuit was filed in the United States
District Court for the Northern District of Illinois against the
Company, Glen Tullman and William Davis by the Plumbers and
Pipefitters Local Union No. 630 Pension-Annuity Trust Fund on
behalf of a purported class consisting of stockholders who
purchased Allscripts common stock between May 8, 2007, and
February 13, 2008. On October 13, 2009, David Robb was appointed
lead plaintiff, and on November 25, 2009, an amended complaint was
filed containing allegations that the Company, Tullman and Davis
made materially false and misleading statements and/or omissions
in connection with the release of TouchWorks EHR, Version 11. On
September 19, 2011, the Court entered an order certifying a class.
On February 7, 2012, the parties agreed, subject to execution of
settlement documents and Court approval, to settle this matter on
a class-wide basis. The settlement amount totaling approximately
$10 million will be funded by the Company's directors' and
officers' liability insurance carrier and therefore has no
material impact on the Company's financial condition or results of
operations. On March 16, 2012, the parties entered into a written
settlement agreement and filed a motion with the Court for
approval of the settlement.
On July 13, 2012, the Court entered an order granting final
approval of the settlement.
Allscripts Healthcare Solutions, Inc., is a provider of clinical,
financial, connectivity and information solutions and related
professional services that empower hospitals, physicians and post-
acute organizations to deliver world-class outcomes. Its
businesses deliver innovative solutions that provide physicians
and other healthcare professionals with just-right, just-in-time
information, connect them to each other and to the entire
community of care, and transform healthcare by improving the
quality and efficiency of patient care. The Company is based in
Chicago, Illinois.
AMERICAN NATIONAL: "Basham" Suit Remanded to Ark. State Court
-------------------------------------------------------------
Michelle Keahey, writing for Legal Newsline, reports that a
federal judge has sent a class action lawsuit against several
insurance companies back to an Arkansas state court.
In a class action lawsuit against insurance companies accused of
conspiring to underpay bodily injury claims through the use of the
software program called Colossus, U.S. District Judge Susan Hickey
granted plaintiffs Eddie Basham and Freda McClendon's motion to
remand the case back to Miller County Circuit Court on Sept. 6.
The case was filed on Dec. 7, 2011, in Miller County, and the
defendants removed it to the Western District of Arkansas,
Texarkana Division on Jan. 17. The defendants wanted the case out
of the lower court because they have been repeatedly on the losing
end of rulings, specifically the Circuit Court's decision to put
off ruling on jurisdictional challenges until the class-
certification stage of litigation.
"Plaintiffs, obtaining the benefit of these rulings, are happy to
be in Miller County Circuit Court, and want to return there,"
Judge Hickey wrote.
The defendants removed the case to federal court, arguing that the
Class Action Fairness Act places it under federal jurisdiction
based on the amount in controversy. According to CAFA, more than
$5 million dollars must be in controversy if the case is to remain
in federal court.
Mr. Basham and Ms. McClendon have promised and stipulated that
they will not seek more than that amount. However, the defendants
argue that the plaintiffs' stipulations are not valid and are not
binding for several reasons.
In her order remanding the case back to Miller County, Judge
Hickey discussed four issues that the defendants found with the
plaintiffs' stipulations: injunctive relief, distinction in the
plaintiffs terms "seek" v. "accept", ad damnum v. a separate
stipulation, and the issue of bad faith.
The insurance companies argued that the plaintiffs are seeking
injunctive relief that falls outside their stipulation's coverage.
Judge Hickey disagreed and wrote that the plaintiffs adequately
capped injunctive relief because they capped "whatever form of
relief may be available."
The defendants further argue that although the Plaintiffs' promise
not to "seek" a certain award, that does not prevent them from
"accepting" a higher award. Judge Hickey states that she is not
persuaded by the distinction and she does not require "magic
words" for an effective stipulation.
Continuing with their argument, the insurance companies state that
the stipulation that is included within the complaint, rather than
separate from the complaint, also causes a problem and makes the
stipulations insufficiently reliable. Judge Hickey found that the
Plaintiffs' in-complaint stipulations were binding and that any
efforts by the plaintiffs to later seek higher damages would be
prevented by the doctrine of judicial estoppel.
Finally, Judge Hickey took up the defendants' arguments of the
plaintiffs' motives.
"Defendants cite Plaintiffs' counsel's pattern of favorable state-
court rulings and prodigious settlements as evidence that
something underhanded is afoot," Judge Hickey wrote.
However, Judge Hickey wrote that speculation was not enough for a
ruling of bad faith.
Just prior to this decision, the insurance companies filed a
motion with Judge Hickey stating that the U.S. Supreme Court
granted certiorari in a case connecting Plaintiffs' remand
arguments (Standard Fire Ins. Co. v. Knowles).
In that case, the Supreme Court will answer the question: if a
plaintiff attempts to beat a defendant's right to removal under
CAFA by filing with a class action complaint a stipulation that
attempts to limit the damages for absent putative class members to
less than the $5 million threshold for federal jurisdiction, and
the defendant establishes that the action amount in controversy,
without the stipulation, exceeds $5 million, is the stipulation
binding on absent class members so as to destroy federal
jurisdiction?
The insurance companies argued that the Supreme Court decision in
Standard Fire would determine that outcome of Mr. Basham and
Ms. McClendon's remand motion. Judge Hickey stated that sitting
on the Basham case for an indeterminate time awaiting a decision
was unwarranted.
The Basham remand is currently on appeal.
BAYER CORP: Settles One-A-Day Vitamin False Advertising Class Suit
------------------------------------------------------------------
Linda Chiem, writing for Law360, reports that Bayer Corp. agreed
on Sept. 26 to pay $300,000 to resolve a certified class action
brought by Ohio consumers claiming the drug giant made false and
unsubstantiated claims about the prostate health benefits of some
of its One-A-Day Men's Health multivitamins.
The proposed deal caps off more than two years of litigation over
claims that Bayer Corp. and subsidiary Bayer Healthcare LLC
breached express warranties under Ohio law by hyping up the
prostate health benefits of substances in the vitamins, including
lycopene and selenium, without scientific backing.
BP: Plaintiffs Wants Oil Spill Settlement Deadline Extended
-----------------------------------------------------------
FuelFix reports that as a Nov. 1 deadline looms, some plaintiffs
say they need more time to decide whether to participate in a
proposed class action settlement in the 2010 Deepwater Horizon rig
explosion and oil spill.
Three Florida plaintiffs are asking a federal judge to extend the
deadline for opting out, saying they can't evaluate the deal
because a court-supervised facility for paying claims hasn't made
enough settlement offers.
Triton Diving Services, Dauphin Island Property Owners Association
and Recreation Investments are asking for the opt-out deadline to
be replaced with one that would allow plaintiffs to opt out at a
much later stage of the spill-related litigation.
U.S. District Judge Carl Barbier recently extended the original
opt-out deadline from Oct. 1 to Nov. 1, calling it a one-time
extension. Plaintiffs who opt out can pursue their own lawsuits;
those who don't automatically become part of the settlement class.
Judge Barbier has scheduled a hearing starting Nov. 8 in which he
will assess the fairness of the proposed settlement between BP and
thousands of Gulf Coast residents who suffered economic damages
when BP's Macondo well blew out.
"It is not an exaggeration to say that 99 percent of class members
will have received absolutely no information regarding the amount
of their settlement (or if they will even receive an offer) when
the current opt-out deadline expires," wrote James Garner, the
lead attorney for Triton Diving Services.
He wrote that thousands of plaintiffs might be denied damages,
after having relinquished their rights to pursue further
litigation.
In a Sept. 24 status report, the court-supervised Deepwater
Horizon Claims Center said it had reduced some documentation
requirements to help speed up the review process. It reported it
had paid only one individual economic loss claim out of the more
than 15,000 claims submitted. At that time the Claims Center said
it hoped to have offer letters for 30 percent of claimants by the
beginning of October.
"The time is running out," said Brent Coon, a Houston-based
attorney with several thousand cases. Mr. Coon said he will wait
as late as possible to decide whether many of his cases should opt
out, but without offer letters, he is under pressure to leave open
the possibility for litigation.
"They promised that we would see a lot of money coming out soon,
but this plan has been in place for five months, with very few
offers to show for it," Mr. Coon said. "We have claimants who
have not had a support check for nine months."
BRE-X MINERALS: Bankruptcy Trustees Seek to Dismiss Investors Suit
------------------------------------------------------------------
Daryl Slade, writing for Calgary Herald, reports that a hearing to
determine the fate of claims by one-time investors against Bre-X
Minerals has been delayed for more than two months after a brief
sitting before Court of Queen's Bench Justice Sal LoVecchio on
Sept. 27.
Deloitte & Touche, the bankruptcy trustees, are seeking to have
the class-action lawsuits by investors dismissed because there is
no money to pay them.
Clint Docken, who has for a long time represented the investors in
the class action, said outside court it was adjourned in order to
have "a more fuller hearing."
Lawyers for the trustees have filed an affidavit with the court
asking for discontinuance of the massive claims on behalf of
Bre-X's creditors in Alberta, Ontario and elsewhere almost 15
years after they were initially filed.
Mr. Docken has called the move from the bankruptcy trustee a
shameful end to what has been billed as the largest mining fraud
and largest stock market scandal in Canadian history.
The application is now scheduled to be heard on Dec. 4.
BRIGHT HOUSE: Sued for Retaining Consumers' Personal Information
----------------------------------------------------------------
Courthouse News Service reports that Bright House Networks
collects personal information from tens of millions of consumers
and retains such information indefinitely, a federal class claims.
CARFAX INC: February 21 Settlement Fairness Hearing Set
-------------------------------------------------------
Nixon Peabody, LLP and Federman & Sherwood on Sept. 28 issued a
statement regarding the Davis v. Carfax, Inc., proposed class
action settlement.
NOTICE OF CLASS ACTION SETTLEMENT
If you purchased a Carfax Vehicle History Report directly from
Carfax, Inc. in Ohio, Oklahoma, Tennessee, or Texas at any time
from October 1, 1998 through December 31, 2007, or in North
Carolina at any time from May 1, 2001 through December 31, 2007,
or in California at any time from February 17, 2002 through
December 31, 2007, you're a Class Member of two subclasses (one
for injunctive relief and one for damages) for purposes of a
proposed settlement of legal claims about that purchase.
As a Class Member, you may, if you desire, enter an appearance in
this Action through an attorney. On February 21, 2013 at 9:00
a.m., the Court in this case will hold a hearing in Courtroom 2N
at the Cleveland County Courthouse, 200 S. Peters, Norman,
Oklahoma, to decide whether to approve this settlement. If the
Court approves it, all Class Members will be bound by the
resulting judgment and Court orders, and eligible Class Members
will be entitled to claim certain discounts or free report
benefits. The Court will also order Carfax to make certain
changes in its disclosures and contracting process with customers.
IF YOU DO NOT OPT OUT OF THE SETTLEMENT AND IT IS APPROVED, YOU
WILL FOREVER RELEASE ANY RIGHTS YOU HAVE TO SUE CARFAX OR ITS
RELATED ENTITIES FOR ANYTHING RELATED TO THE FACTS OR CLAIMS
COVERED IN THE SETTLEMENT.
Claim Forms are available at http://www.daviscarsettlement.comor
by writing to Davis v. Carfax, Inc., c/o GCG, P.O. Box 35026,
Seattle, WA, 98124-1026, and must be completed by February 21,
2013. If you're a Class Member and want to opt out of this
settlement, however, you must do so in writing by January 7, 2013.
You must provide your full name and address, state that you want
to opt out of the Carfax settlement in Davis v. Carfax, Inc., No.
CJ-04-1316L, and deliver your request by hand, mail or courier
delivery service to Class Counsel and Defendants' Counsel. If you
do not elect to opt out of the settlement, you may, if you desire,
enter an appearance in this Action through an attorney. If you
want to object to this settlement, you must do so in writing by
January 21, 2013. You must provide your full name and address,
include all arguments, citations, and evidence supporting your
objection, specify who, if anyone, will attend the hearing to
speak for your objection, deliver your objection both to Class
Counsel and to Defendants' Counsel by hand, mail or courier
delivery service, and file a copy of your objection with the Clerk
of Court in Norman, Oklahoma.
For further information, including details of the settlement,
please visit http://www.daviscarsettlement.comor write to Class
Counsel c/o William B. Federman at the address below. DO NOT
CONTACT THE COURT FOR INFORMATION.
Christopher M. Mason, Esq. William B. Federman, Esq.
NIXON PEABODY, LLP Jennifer Sherrill, Esq.
437 Madison Avenue FEDERMAN & SHERWOOD
New York, New York 10022 10205 North Pennsylvania Avenue
Oklahoma City, Oklahoma 73120
Defendants' Counsel Class Counsel
CHASE HOME: Judge Dismisses Truth-In-Lending Class Action
---------------------------------------------------------
Kaitlin Ugolik, writing for Law360, reports that an Alabama
federal judge on Sept. 26 dismissed a putative truth-in-lending
class action against Chase Home Financial LLC alleging it failed
to timely notify customers when their mortgages were assigned to
it, finding that the lender is exempt from such requirements.
Chase's activities fall within the "safe harbor" provision of the
Truth in Lending Act, which states that as a loan servicer it
shouldn't be treated as the assignee or owner of the loan and
therefore has no duty of notification, U.S. District Judge William
H. Steele ruled.
CHINA AUTOMOTIVE: Court Denies Securities Suit Dismissal Bid
------------------------------------------------------------
The United States District Court for the Southern District of New
York denied in August 2012 China Automotive Systems, Inc.'s
motion to dismiss a securities class action lawsuit, according to
the Company's August 9, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2012.
On October 25, 2011, a purported securities class action was filed
in the United States District Court for the Southern District of
New York on behalf of all purchasers of the Company's securities
between March 25, 2010, and March 17, 2011. On February 24, 2012,
the plaintiffs filed an amended complaint, changing the purported
class period from May 12, 2009, through March 17, 2011. The
amended complaint alleges that the Company, certain of its present
officers and directors and the Company's former independent
accounting firm violated Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, and the rules promulgated there
under, and seeks unspecified damages. The Company has filed a
motion to dismiss the amended complaint, which was fully briefed
on April 18, 2012. On August 8, 2012, the court denied the
Company's motion to dismiss the amended complaint. The Company
has not yet responded to plaintiffs' amended complaint, and
continues to believe that the allegations in the complaint are
without merit and intends to defend itself vigorously against the
claims.
The complaint does not specify an amount of damages that the
plaintiffs seek. Moreover, because the matter is in very early
stage, the Company cannot determine whether an adverse outcome is
probable, nor can it provide a reasonable estimate of potential
losses related to these matters. While the Company believes that
it has meritorious defenses to the action and intends to defend it
vigorously, an adverse outcome in the matter could have a material
adverse effect on the Company's business, financial condition,
results of operations or liquidity.
Based in Hubei Province, People's Republic of China, China
Automotive Systems, Inc. (Nasdaq: CAAS) is a supplier of power
steering systems and components to China automotive industry,
operating through nine subsidiaries. Its product offering
encompasses a full range of auto parts incorporated into steering
systems for both passenger automobiles and commercial vehicles.
CIT GROUP: Obtained Final Approval of Securities Suit Settlement
----------------------------------------------------------------
CIT Group Inc. received final approval of its settlement of a
securities class action lawsuit in June 2012, according to the
Company's August 9, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2012.
In July and August 2008, two putative class action lawsuits were
filed in the United States District Court for the Southern
District of New York (the "SDNY") on behalf of CIT's pre-
reorganization stockholders against CIT, its former CEO and its
former CFO. In August 2008, a putative class action lawsuit was
filed in the SDNY by a holder of CIT-PrZ equity units against CIT,
its former CEO, former CFO, former Controller and certain members
of its current and former Board of Directors. In May 2009, the
Court consolidated these three shareholder actions into a single
action (the "Securities Litigation") and appointed Pensioenfonds
Horeca & Catering as Lead Plaintiff to represent the proposed
class, which consisted of all acquirers of CIT common stock and
PrZ preferred stock from December 12, 2006, through March 5, 2008,
who allegedly were damaged, including acquirers of CIT-PrZ
preferred stock pursuant to the October 17, 2007 offering of such
preferred stock.
In July 2009, the Lead Plaintiff filed a consolidated amended
complaint alleging violations of the Securities Exchange Act of
1934 ("1934 Act") and the Securities Act of 1933 ("1933 Act").
Specifically, it was alleged that the Company and certain of its
former officers violated Section 10(b) of the 1934 Act by making
false and misleading statements and omissions regarding CIT's
subprime home lending and student lending businesses. The
allegations relating to the Company's home lending business are
based on the assertion that the Company failed to fully disclose
the risks in the Company's portfolio of subprime mortgage loans.
The allegations relating to the Company's student lending business
were based upon the assertion that the Company failed to account
in its financial statements or, in the case of the preferred
stockholders, its registration statement and prospectus, for
private loans to students of a helicopter pilot training school,
which it alleged were highly unlikely to be repaid and should have
been written off. The Lead Plaintiff also alleged that the
Company, certain of its former officers, and those current and
former Directors of the Company who signed the registration
statement in connection with the October 2007 CIT-PrZ preferred
offering violated the 1933 Act by making false and misleading
statements concerning the Company's student lending business.
Pursuant to a Notice of Dismissal filed on November 24, 2009, CIT
Group Inc. was dismissed as a defendant from the Securities
Litigation as a result of its discharge in bankruptcy. On
June 10, 2010, the SDNY denied the remaining defendants' motion to
dismiss the consolidated amended complaint. In February 2012, the
parties to the Securities Litigation agreed to the terms of a
settlement (the "Settlement Agreement"). The Settlement Agreement
was granted final approval by the SDNY by order dated June 13,
2012. In light of the Company's insurance coverage and existing
reserves, the settlement did not have a material effect on the
Company's financial condition.
COHEN MCNEILE: Judge Tosses Debt Collection Class Action
--------------------------------------------------------
David Lee at Courthouse News Service reports that a Kansas federal
judge has tossed a class action that accused a law firm of
illegally collecting debts by charging excessive post-judgment
interest in violation of a 12 percent maximum under state law.
U.S. District Judge Eric F. Melgren granted defendant Cohen,
McNeile & Pappas P.C.'s motion to dismiss on September 18.
Named plaintiffs Donald M. Browning and Gabrielle Browning sued
the Leawood, Kansas-based law firm in state court in 2011,
accusing it of violating the federal Fair Debt Collection
Practices Act and Kansas Consumer Protection Act by charging them
26.15 percent and 23.10 percent interest, respectively, on post-
judgment debt.
The Brownings filed their complaint after the law firm sued them
over small claims consumer debt that was then converted to
judgment debt when the court ruled in the creditor's favor.
Later removed to Wichita Federal Court, the suit hinged on the
Brownings' contention that the defendant is collecting interest at
an illegally excessive rate and that it abused judicial process
when it altered a post-judgment interest provision of a
standardized, pre-written judgment form filled out for Johnson
County.
The defendant responded that it is allowed to charge the higher
rate under state law "because the interest rate on the underlying
consumer debt represents a contract between the debtor and
creditor that carries through to the judgment debt."
Judge Melgren was not persuaded by the suit, writing that "because
plaintiffs' claims for relief are based on an improper reading of
Kansas statutes, and because plaintiffs have not presented
sufficient support for the court to conclude that a plausible
claim for relief exists under the facts alleged, the court grants
Defendant's motion to dismiss."
In his 22-page opinion, Judge Melgren wrote that it is ambiguous
which of two competing state statutes apply to the facts of the
case.
"Both sections discussing post-judgment interest apply to the
judgment against plaintiffs," he wrote. "But applying the plain
language of the statutes to this case renders them incapable of
simultaneous application- under section 16-204(e)(2), the post-
judgment interest rate is 12 percent, and under section 16-205,
defendant may collect the same interest rate that applied to
plaintiffs' underlying debt."
As a result, Judge Melgren was forced to consider case law and
canons of statutory construction to determine which applies. He
concluded that neither the plain language of the 12 percent limit
nor case law supported the plaintiff's argument.
"First, the Kansas legislature prefaced all provisions of Kan.
Stat. Ann. Sec. 16-204 with the phrase, 'Except as otherwise
provided in accordance with law.' That phrase indicates that
other interest rates -- including higher interest rates -- may
supersede the provisions of section 16-204," the judge wrote.
"Second, section 16-204(e)(2) does not say that twelve percent is
the maximum interest rate authorized by law. And although section
16-204(e)(2) says that 'the rate of interest on judgments . . .
shall be 12 percent per annum,' the Kansas Supreme Court has
repeatedly interpreted 'shall' to mean 'may' within the context of
certain statutes."
Furthermore, Judge Melgren wrote that it would be bad public
policy to support the statute limiting the interest rate and that
Kansas courts have generally allowed parties to choose the terms
that they will be bound to under contract.
"Having negotiated those terms, it would be unfair for a party to
escape its contractual obligations by defaulting on the contract,"
he wrote. "Section 16-205(a) is therefore "the legislature's
recognition that a party is entitled to the bargained-for interest
rate until paid in full."
Judge Melgren also ruled the Brownings failed to state a common
law claim for abuse of process regarding the defendant's changes
to the judgment form, finding they were "unclear" as to their
exact theory of recovery.
"Rather than leaving an ambiguous term in the judgment form,
defendant changed the offending provision to reflect the
appropriate interest rate, as permitted by Kan. Stat. Ann.
Sec. 16-205(a)," Judge Melgren wrote. "Because it comports with
Kansas law and the local rules for actions under Chapter 61, the
substance of Defendant's alteration was not an abuse of process."
(top of page 20) He also ruled the plaintiffs failed to state
claim under FDCPA and KCPA for abuse of process because the
defendant did not "make false or deceptive representations on
court orders or otherwise abuse judicial process."
"Defendant was entitled to collect interest at a "statutory" rate
-- even if the applicable statute was not the one advocated by
plaintiffs -- and that statutory rate should be reflected in the
parties' judgment forms," he wrote. "Furthermore, abuse of
process generally involves 'some form of extortion, using the
process to put pressure upon the other to compel him to pay a
different debt.' Plaintiffs do not allege that they were
confused, let alone exploited, by Defendant's line-item alteration
of the court's journal entry and judgment form."
COSTCO WHOLESALE: Loses Bid to Dismiss Gender Bias Class Action
---------------------------------------------------------------
Jonny Bonner at Courthouse News Service reports that Costco must
face claims that it refused to promote women to management
positions, a federal judge ruled, striking down the membership
retailer's motion to deny class status in a long-running
California lawsuit.
Shirley "Rae" Ellis, Leah Horstman and Elaine Sasaki sued Costco
in 2006. Their putative class action alleged the company denied
general and assistant general manager positions to female workers
since 2002.
U.S. District Judge Marilyn Patel granted the action class
certification in 2007. But, the Ninth Circuit affirmed in part,
vacated in part and remanded the order for reconsideration in
2011, citing Wal-Mart Stores Inc. v. Dukes.
Costco filed a motion for an order eliminating class claims on
remand, and the plaintiffs filed a cross-motion for class
certification, leading to a Sept. 24 decision by U.S. District
Judge Edward Chen.
In an 86-page ruling, Judge Chen approved injunctive and monetary
relief classes in the suit, and said a jury may decide whether the
Issaquah, Wash.,-based business engaged in the alleged
discrimination.
Current and future female employees constitute the injunctive
class, the ruling states, while former employees subject to
Costco's system for promotion after Jan. 3, 2002, are included in
the monetary class.
About 700 women may join the suit, Judge Chen added.
According to the Ninth Circuit, Costco promotes almost entirely
from within. Only assistant general managers are eligible for
general manager positions, and the company has no written
guidelines for or informs employees about promotions.
Nonetheless, the appeals court added, Costco imposed uniform
policies and practices with regard to its promotion system.
However, Judge Chen countered, "Plaintiffs" statistical evidence
demonstrates class-wide -- as opposed to fragmented or localized
-- gender disparities supporting its contention that defendant's
class-wide practices yield class-wide effects."
Judge Chen added: "Because Plaintiffs have presented significant
proof of companywide policies and companywide gender disparities
-- essentially, purported common 'causes' and common 'effects' --
the court finds plaintiffs have satisfied the requirement for
commonality under Rule 23(a)(2) for purposes of their disparate
treatment claim."
Judge Chen called individualized hearings in the case "narrow in
scope," and said "multiple and substantial" questions on class-
wide issues trumped claims for individual relief.
"There are numerous common questions of fact and law, the answers
to which are apt to drive the resolution of this case," Judge Chen
said, referring to Costco's promotion system as a "tap-on-the-
shoulder appointment process."
Costco operates nearly 600 warehouse-style clubs worldwide,
selling items from groceries to electronics. On average, a Costco
general manager earns $116,000 annually. Assistant general
managers command about $73,000 per year.
Judge Chen appointed Ms. Sasaki, a current Costco employee, as
representative of the injunctive relief class. Ellis, Horstman
and Sasaki will act as class representatives of the monetary
class.
Judge Chen also appointed Impact Fund; Lewis, Feinberg, Lee,
Renaker & Jackson P.C.; Davis, Cowell & Bowe LLP; Lieff, Cabraser,
Heimann & Bernstein LLP; and Altshuler Berzon LLP as class
counsel.
A copy of the Order Granting Plaintiffs' Motion for Class
Certification; and Denying Defendant's Motion to Eliminate Class
Claims in Ellis, et al. v. Costco Wholesale Corporation, Case No.
04-cv-03341 (N.D. Calif.), is available at:
http://www.courthousenews.com/2012/10/01/304-cv-03341.pdf
DALE AND THOMAS: Recalls Bags of Various Popcorn Products
---------------------------------------------------------
Dale and Thomas Popcorn is voluntarily recalling a limited number
of ready-to-eat bags of select flavors of Popcorn, Indiana-brand
popcorn products (listed below) because of possible contamination
by Listeria monocytogenes. Listeria monocytogenes is an organism
which can cause serious and sometimes fatal infections in young
children, frail or elderly people, and others with weakened immune
systems. Although healthy individuals may suffer only short-term
symptoms such as high fever, severe headache, stiffness, nausea,
abdominal pain and diarrhea, Listeria infection can cause
miscarriages and stillbirths among pregnant women. Anyone who is
concerned about a possible health problem or illness should
contact a healthcare provider immediately.
Products involved in the recall should not be consumed and may be
returned to the point of purchase for a full refund or
replacement.
The recalled products were distributed to various retailers,
vendors, distribution centers, and consumers through the Internet
on or after August 8, 2012, with Best By dates of February 4,
2013, through March 12, 2013. All recalled products were packaged
in red bags of various sizes. Consumers can identify if they have
purchased an impacted product by looking at the Best By date
located in the front, top right corner of the package and the Bag
UPC (Code) located in the nutritional panel found on the back,
bottom left corner of the package. Pictures of the recalled
products' labels are available at:
http://www.fda.gov/Safety/Recalls/ucm321980.htm
All other Popcorn, Indiana-brand products are safe to consume.
The potential for contamination was noted after testing by the
company revealed the presence of Listeria monocytogenes in some
ready-to-eat bags of Popcorn, Indiana-brand products.
Consumers with recalled product(s) should contact Dale and Thomas'
dedicated recall hotline (866) 940-7936 Monday through Friday 9:00
a.m. to 4:30 p.m. Eastern Time, or e-mail the Company at:
recall@daleandthomaspopcorn.com for additional information.
Recalled Products
PKG
Flavor Type Size Bag UPC (Code) Best By Dates
------ ---- ---- -------------- -------------
Aged White Bag 3.5 oz 843571000532 2/11/2013,
Cheddar 2/16/2013,
2/25/2013,
2/27/2013,
3/09/2013,
3/10/2013
Aged White Bag 8 oz 843571000785 2/05/2013,
Cheddar 2/11/2013,
2/16/2013,
2/17/2013,
2/18/2013,
2/25/2013,
2/26/2013,
2/27/2013,
3/09/2013,
3/10/2013
Aged White Bag 8.3 oz 843571002956 2/04/2013,
Cheddar 2/05/2013,
2/11/2013,
2/17/2013,
2/18/2013,
2/25/2013,
2/26/2013,
2/27/2013
Aged White Bag 9 oz 843571000785 2/18/2013,
Cheddar 2/25/2013
Almond Bag 6.5 oz 843571003809 2/16/2013,
Biscotti 3/04/2013
Almond Bag 7 oz 843571003854 3/03/2013,
Biscotti 3/04/2013
American Bag 7 oz 843571004134 2/04/2013,
Cheese 2/12/2013,
3/09/2013
Apple Crisp Bag 8 oz 843571003243 3/04/2013
Bacon Ranch Bag 3.5 oz 843571001942 2/18/2013,
3/06/2013,
3/09/2013,
3/10/2013
Bacon Ranch Bag 7.75 oz 843571001935 2/18/2013
Bacon Ranch Bag 8.3 oz 843571003007 2/12/2013,
2/18/2013,
3/06/2013
Black & White Bag 6 oz 843571002345 2/09/2013,
Drizzle 2/13/2013,
2/23/2013,
3/03/2013
Caramel Bag 7.4 oz 843571003045 2/16/2013,
3/12/2013
Caramel Bag 8 oz 843571002369 2/04/2013,
2/16/2013,
3/03/2013
Caramel Bag 7 oz 843571003861 3/03/2013
Roasted Peanuts
Chocolate Bag 5 oz 843571003786 3/06/2013,
Peanut Butter 3/09/2013
Chocolate Bag 5.5 oz 843571003847 2/05/2013,
Peanut Butter 2/20/2013,
2/23/2013,
2/24/2013,
3/06/2013
Cinnamon Bag 5.5 oz 843571003052 3/06/2013,
Sugar Drizzle 3/09/2013
Cinnamon Bag 6 oz 843571002352 2/19/2013,
Sugar Drizzle 2/24/2013,
3/10/2013
Dark Fudge Bag 5.5 oz 843571003076 3/06/2013,
Chocolate Chip Drizzle 3/09/2013
Dark Fudge Bag 6 oz 843571002338 2/10/2013,
Chocolate Chip 2/12/2013,
Drizzle 2/23/2013
Kettlecorn Bag 9.75 oz 843571000150 2/06/2013,
2/17/2013
Kettlecorn Bag 14 oz 843571000693 2/06/2013
Kettlecorn 8-Pack 0.7 oz 843571001676 2/04/2013
Multipack Bag
Salt & Pepper Bag 6.9 oz 843571003557 2/12/2013,
3/10/2013
Wasabi Bag 5.5 oz 843571002048 2/18/2013,
Reserve 3/06/2013
FANNIE MAE: Sherburne County Joins Deed Tax Class Action
--------------------------------------------------------
Ken Francis, writing for Sherburne County Citizen, reports that
Sherburne County is joining with Hennepin County in a class action
lawsuit in an effort to collect taxes that should have been paid
by another party.
At the request of Sherburne County Attorney Kathleen Heaney, the
board of commissioners agreed to become part of a class action
civil lawsuit against mortgage loan corporations Fannie Mae and
Freddie Mac for allegedly failing to pay deed tax on homes they
acquired during the foreclosure crisis that started back in 2005.
Fannie Mae (Federal National Mortgage Association), and Freddie
Mac (Federal Home Loan Mortgage Corp.), are corporations
established by Congress that purchase mortgage loans established
by other entities.
When the number of foreclosures began to increase as the housing
crisis escalated, so did Fannie Mae and Freddie Mac's
participation. But neither have paid the Minnesota Deed Transfer
Tax on properties the corporations owned during the foreclosure
crisis.
"They're for-profit, publicly traded corporations," Ms. Heaney
told the board on Sept. 25. "The issue is whether or not they're
exempt from paying deed transfer tax. They have not been paying
it."
State deed tax is paid by the seller whenever a home is sold and
the deed is recorded. The tax is collected by the county, says
Sherburne County Recorder Michelle Ashe. Most of it (97%) goes to
the state and the county retains the rest. The state deed
transfer tax is 0.33%. For a home valued at $150,000 in greater
Minnesota that's about $500.
But Fannie Mae and Freddie Mac haven't paid the tax, claiming they
are exempt because they are an instrument of the federal
government.
Hennepin County announced its lawsuit on Aug 24. The suit, if
successful, could recoup more than $10 million in unpaid state
deed taxes.
A number of other states have filed similar suits in the past few
weeks. Ms. Heaney said earlier this year, the U.S. District Court
in Michigan ruled Fannie Mae and Freddie Mac were not exempt from
paying the tax.
Ms. Heaney said Hennepin County is not asking for any monetary
compensation from participating counties. She said they will pay
the cost of the lawsuit and deduct actual costs from monies
rewarded if the suit is successful. Should the lawsuit fail,
Sherburne County is not on the hook for anything, she said.
Ms. Ashe said she has no figures on how much the county would
receive if the lawsuit is successful, but it won't be a large
figure.
Commissioner Ewald Petersen said as long as it doesn't cost the
county anything, it was better to join in the class action suit.
"The bottom line is, something is better than nothing," he said.
FIRST ALARM: Blumenthal, Nordrehaug & Bhowmik Files Class Action
----------------------------------------------------------------
Blumenthal, Nordrehaug & Bhowmik disclosed that on September 11,
2012, First Alarm Security & Patrol, Inc. found itself the target
of a wage and hour lawsuit at the hands of San Francisco
employment law firm Blumenthal, Nordrehaug & Bhowmik.
Among the many allegations, the Complaint asserts that First Alarm
did not pay their Security Employees for mandatory training time.
Moreover, the complaint alleges that First Alarm required their
employees to work "off the clock." The Security Employees
allegedly were required to show up to work 15 minutes prior to
their scheduled shifts for briefings on their day's activities and
were never paid for the time spent showing up early.
For more information on this case, see Swartout, et al. vs. First
Alarm Secuirty & Patrol, Inc., Case No. 112CV231989, currently
pending in the Santa Clara County Superior Court for the State of
California.
Blumenthal, Nordrehaug & Bhowmik is a labor and employment law
firm dedicated to representing employees who were victimized by
their employers with wage and hour violations.
FORD MOTOR: Faces Class Action Over Non-Flat Towable Vehicles
-------------------------------------------------------------
Courthouse News Service reports that Ford Motor Co. failed to warn
that the Ford Escapes, Ford Fusions, Mercury Milans and Mercury
Mariners could not be "flat towed" on all four wheels, a class
claims in federal court.
FREDDIE MAC: Judge Tosses Civil Securities Fraud Class Action
-------------------------------------------------------------
The Associated Press reports that a federal judge has tossed out a
lawsuit against Freddie Mac that accused the mortgage giant and
three top executives of understating the level of risky mortgages
the company held before the housing bubble burst.
U.S. District Judge John Keenan in New York City dismissed the
class-action suit filed by several shareholders accusing Freddie
Mac and the former executives of civil securities fraud. Judge
Keenan said the company reported full and accurate information to
investors during the period in question, from Nov. 20, 2007, to
Sept. 7, 2008.
The Securities and Exchange Commission filed charges in December
alleging similar violations against Freddie Mac, its sibling
Fannie Mae and six former executives of the companies. That suit
is still pending.
The government rescued Fannie and Freddie in 2008 after they
incurred massive losses on risky mortgages. Taxpayers have spent
about $170 billion to rescue the companies.
Judge Keenan dismissed the suit with prejudice, meaning that the
claims cannot be raised again. The suit was originally filed in
August 2008. Judge Keenan had dismissed an earlier version of the
lawsuit in April 2011, and the plaintiffs filed a revised suit.
Judge Keenan's ruling, which was made on Sept. 24, was announced
by McLean, Va.-based Freddie on Sept. 27.
The executives named in the suit are former Freddie CEO Richard
Syron, former chief financial officer Anthony Piszel and former
chief business officer Patricia Cook.
The pension funds that held Freddie stock and filed the suit
alleged that Freddie and the executives understated the company's
exposure to high-risk mortgages and overstated its capital
reserves. The stock price fell when information about Freddie's
true financial picture "leaked out," the suit said.
Fannie and Freddie buy home loans from banks and other lenders,
package them into bonds and then sell them to investors around the
world. The two companies own or guarantee about half of all U.S.
mortgages, or nearly 31 million loans.
GENON ENERGY: Appeals in Natural Gas Prices Suit Remain Pending
---------------------------------------------------------------
GenOn Energy, Inc. is a party to five lawsuits, several of which
are class action lawsuits, in state and federal courts in Kansas,
Missouri, Nevada and Wisconsin. These lawsuits were filed in the
aftermath of the California energy crisis and the resulting
Federal Energy Regulatory Commission investigations and relate to
alleged conduct to increase natural gas prices in violation of
antitrust and similar laws. The lawsuits seek treble or punitive
damages, restitution and/or expenses. The lawsuits also name a
number of unaffiliated energy companies as parties. In July 2011,
the judge in the United States District Court for the District of
Nevada handling four of the five cases granted the defendants'
motion for summary judgment dismissing all claims against the
Company in those cases. The plaintiffs have appealed to the
United States Court of Appeals for the Ninth Circuit. The fifth
case is pending in the State of Nevada Supreme Court on
plaintiff's appeal of the dismissal of all its claims by the
Eighth Judicial District Court for Clark County, Nevada. The
Company has agreed to indemnify CenterPoint Energy Inc. against
certain losses relating to these lawsuits.
No updates were reported in the Company's August 9, 2012, Form 10-
Q filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2012.
Founded in 1982 and based in Houston, Texas, GenOn Energy, Inc. --
http://www.genon.com/-- together with its subsidiaries, provides
energy, capacity, ancillary, and other energy services to
wholesale customers in the energy market in the United States. It
also operates as a wholesale generator of electricity; and
involves in asset management and proprietary trading, fuel oil
management, and natural gas transportation and storage activities.
The Company generates electricity using coal, natural gas, and oil
resources. It operates 8 generating facilities with a total net
generating capacity of 6,341 megawatt in Maryland, New Jersey, and
Virginia; 23 generating facilities with a total net generating
capacity of 7,483 megawatt in Illinois, Ohio, and Pennsylvania; 7
generating facilities with a total net generating capacity of
5,391 megawatt in California; and 8 generating facilities with a
total net generating capacity of 4,482 megawatt in Florida,
Massachusetts, Mississippi, New York, and Texas.
GENON ENERGY: Faces Shareholder Suits Over Proposed NRG Merger
--------------------------------------------------------------
GenOn Energy, Inc. is facing class action lawsuits arising from
its proposed merger with a subsidiary of NRG Energy, Inc.,
according to the Company's August 9, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2012.
On July 20, 2012, the Company entered into an agreement by and
among NRG Energy, Inc., Plus Merger Corporation, a direct wholly-
owned subsidiary of NRG, and GenOn. Upon the terms and subject to
the conditions set forth in the NRG Merger Agreement, which has
been approved by the boards of directors of GenOn and NRG, a
wholly-owned subsidiary of NRG will merge with and into GenOn,
with GenOn continuing as the surviving corporation and a wholly
owned subsidiary of NRG.
In July 2012, the Company, the members of its board of directors,
NRG, and Plus Merger Corporation (a wholly-owned subsidiary of
NRG) were named defendants in three purported class action
lawsuits filed in the District Court of Harris County, Texas, one
purported class action lawsuit filed in the United States District
Court for the Southern District of Texas, and five purported class
action lawsuits filed in the Court of Chancery of the State of
Delaware, in each case, brought on behalf of proposed classes
consisting of holders of the Company's common stock, excluding
defendants and their affiliates. The complaints allege, among
other things, that the NRG Merger Agreement was the product of
breaches of fiduciary duties by the individual defendants, in that
it allegedly does not maximize the value for the Company's
stockholders, and that the other defendants aided and abetted the
individual defendants' breaches of fiduciary duties. The
complaints seek, among other things, (a) a declaration that the
NRG Merger Agreement was entered into in breach of the defendants'
duties, (b) to enjoin defendants from consummating the NRG Merger,
(c) directing the defendants to exercise their duties to obtain a
transaction which is in the best interests of the Company's
stockholders, (d) granting the class members any benefits
allegedly improperly received by the defendants, and/or (e) a
rescission of the NRG Merger if it is consummated. The Company
thinks that the allegations of the complaints are without merit
and that it has substantial meritorious defenses to the claims
made in these actions.
Founded in 1982 and based in Houston, Texas, GenOn Energy, Inc. --
http://www.genon.com/-- together with its subsidiaries, provides
energy, capacity, ancillary, and other energy services to
wholesale customers in the energy market in the United States. It
also operates as a wholesale generator of electricity; and
involves in asset management and proprietary trading, fuel oil
management, and natural gas transportation and storage activities.
The Company generates electricity using coal, natural gas, and oil
resources. It operates 8 generating facilities with a total net
generating capacity of 6,341 megawatt in Maryland, New Jersey, and
Virginia; 23 generating facilities with a total net generating
capacity of 7,483 megawatt in Illinois, Ohio, and Pennsylvania; 7
generating facilities with a total net generating capacity of
5,391 megawatt in California; and 8 generating facilities with a
total net generating capacity of 4,482 megawatt in Florida,
Massachusetts, Mississippi, New York, and Texas.
GENON ENERGY: Removed Plant Emissions Suit to Penn. Dist. Ct.
-------------------------------------------------------------
GenOn Energy, Inc. removed to a federal court in Pennsylvania a
class action lawsuit over emissions from its Cheswick generating
facility, according to the Company's August 9, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2012.
In April 2012, a putative class action lawsuit was filed against
the Company in the Court of Common Pleas of Allegheny County,
Pennsylvania, alleging that emissions from the Company's Cheswick
generating facility have damaged the property of neighboring
residents. The Company disputes these allegations. Plaintiffs
have brought nuisance, negligence, trespass and strict liability
claims seeking both damages and injunctive relief. Plaintiffs
seek to certify a class that consists of people who own property
or live within one mile of the Company's plant. In July 2012, the
Company removed the lawsuit to the United States District Court
for the Western District of Pennsylvania.
Founded in 1982 and based in Houston, Texas, GenOn Energy, Inc. --
http://www.genon.com/-- together with its subsidiaries, provides
energy, capacity, ancillary, and other energy services to
wholesale customers in the energy market in the United States. It
also operates as a wholesale generator of electricity; and
involves in asset management and proprietary trading, fuel oil
management, and natural gas transportation and storage activities.
The Company generates electricity using coal, natural gas, and oil
resources. It operates 8 generating facilities with a total net
generating capacity of 6,341 megawatt in Maryland, New Jersey, and
Virginia; 23 generating facilities with a total net generating
capacity of 7,483 megawatt in Illinois, Ohio, and Pennsylvania; 7
generating facilities with a total net generating capacity of
5,391 megawatt in California; and 8 generating facilities with a
total net generating capacity of 4,482 megawatt in Florida,
Massachusetts, Mississippi, New York, and Texas.
GMX RESOURCES: Responses to Oklahoma Suit to Be Filed Late 2012
---------------------------------------------------------------
GMX Resources Inc. and other defendants' responses to the
securities class action complaint pending in Oklahoma are expected
to be filed later this year, according to the Company's August 9,
2012, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2012.
A putative class action lawsuit was filed by the Northumberland
County Retirement System and Oklahoma Law Enforcement Retirement
System (collectively, the "Nothumberland Plaintiffs") in the
District Court in Oklahoma County, Oklahoma, purportedly on
March 10, 2011, against the Company and certain of its officers
along with certain underwriters of the Company's July 2008, May
2009 and October 2009 public offerings. Discovery requests and
summons were filed and issued in late April 2011. The complaint
alleges that the registration statement and the prospectus for
contained material misstatements and omissions and seeks damages
under Sections 11, 12 and 15 of the Securities Act of 1933 of an
unspecified equitable relief. Defendants removed the case to
federal court on May 12, 2011, and filed motions to dismiss on
June 20, 2011. Plaintiffs filed a motion to remand the case to
state court on June 10, 2011, and Defendants filed an opposition
to that motion. By order dated November 16, 2011, the court
denied Plaintiffs' motion to remand. On February 3, 2012,
Plaintiffs moved to be appointed lead plaintiff under the Private
Securities Litigation Reform Act. By order dated July 3, 2012,
the Court appointed the Northumberland Plaintiffs lead plaintiff.
On August 16, 2012, Plaintiffs were expected to elect to move
forward with their existing complaint or to file an amended
complaint, with Defendants' responses thereto expected to be filed
later in 2012.
The Company says it is currently unable to assess the probability
of loss or estimate a range of potential loss, if any, associated
with the securities class action case, which is at an early stage.
Based in Oklahoma City, Oklahoma, GMX Resources Inc., together
with its subsidiaries, is an independent oil and natural gas
exploration and production company historically focused on the
development of the Cotton Valley group of formations, specifically
the Cotton Valley Sands layer in the Schuler formation and the
Upper Bossier, Middle Bossier and Haynesville/Lower Bossier layers
of the Bossier formation, in the Sabine Uplift of the Carthage,
North Field of Harrison and Panola counties of East Texas
GROUPON INC: Judge Rejects $8.5-Mil. Class Action Settlement
------------------------------------------------------------
Nate Raymond, writing for Reuters, reports that a U.S. judge on
Sept. 28 rejected a proposed $8.5 million class action settlement
with Groupon Inc. intended to resolve allegations that the
expiration dates on its coupons violated consumer protection laws.
U.S. District Judge Dana Sabraw in San Diego found fault with a
provision in the settlement that would have set aside $75,000 to
be divided among two non-profit groups. The judge said neither of
the organizations were "expressly committed to righting the
specific wrongs alleged in this case."
While Judge Sabraw denied other objections to the settlement by
members of the class, he said he had to reject the entire
settlement because he did not have the authority to strike just
the charity provisions.
Representatives for Groupon did not immediately respond to
requests for comment.
John Stoia, a lawyer at Robbins Geller Rudman & Dowd representing
plaintiffs who bought vouchers on Groupon, did not immediately
respond to a request for comment.
The decision marked the latest by a court to address so-called cy
pres awards in class actions, in which money is dedicated to
charity rather than distributed to the plaintiffs themselves. Cy
pres comes from a French phrase meaning "as near as possible."
The charitable awards have become common when the amount of money
recovered is small and the class itself is large, making
distribution impractical.
The charities are typically intended to represent the interests of
the classes of plaintiffs.
But in several instances, courts have rejected the settlements
after finding the money dedicated to the cy pres award should go
to the plaintiffs themselves, or are going to inappropriate
charities.
Groupon agreed to the settlement in April as the Chicago-based
company sought to put behind it lawsuits alleging that its
vouchers violated federal and state laws applying to the
expiration dates for gift certificates.
Among the laws Groupon allegedly violated was the federal Credit
Card Accountability Responsibility and Disclosure Act, which
restricts the sale of gift certificates that expire in less than
five years. Groupon denied the allegations.
Of the $8.5 million, $75,000 was set to go to the Electronic
Frontier Foundation and the Center for Democracy and Technology,
two organizations concerned with Internet rights.
But Judge Sabraw said neither organization was focused on the core
issue of the case -- expiration dates and other restrictions on
consumer vouchers or misleading advertising related to vouchers.
"That consumers purchase vouchers on the Internet is not enough,"
he said. "Indeed, it is incidental to the claims at issue in this
case."
Judge Sabraw said he agreed with objectors who argued that the
money should instead be distributed to the class itself.
Representatives for the non-profits did not immediately respond to
requests for comment.
The case is In re Groupon Marketing and Sales Practices
Litigation, U.S. District Court for the Southern District of
California, No. 11-md-02238.
HOUSTON AMERICAN: Continues to Defend "Silverman" Class Suit
------------------------------------------------------------
Houston American Energy Corp. continues to defend itself against a
securities class action lawsuit initiated by Steve Silverman,
according to the Company's August 9, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2012.
On April 27, 2012, a purported class action lawsuit was filed in
the U.S. District Court for the Southern District of Texas against
the Company and certain of its executive officers: Steve Silverman
v. Houston American Energy Corp. et al., Case No. 4:12-CV-1332.
The complaint generally alleges that, between March 29, 2010, and
April 18, 2012, all of the defendants violated Sections 10(b) of
the Securities Exchange Act of 1934 and SEC Rule 10b-5 and the
individual defendants violated Section 20(a) of the Exchange Act
in making materially false and misleading statements including
certain statements related to the status and viability of the
Tamandua #1 well. Additional class action lawsuits have since
been filed against the Company, and may in the future be filed
against the Company, based on the same factual allegations set
forth in the Silverman case. The Complaint in the Silverman case
seeks unspecified damages, interest, attorneys' fees, and other
costs. The Company believes all of the claims in the Silverman
case are without merit and intends to vigorously defend against
these claims. It is not possible at this time to predict the
timing or outcome of the Silverman case or any other class action
lawsuits that have or may be filed. The Company expects to incur
costs and to devote management time and resources to defending
such lawsuits.
No updates were reported in the Company's latest SEC filing.
Based in Houston, Texas, Houston American Energy Corp. --
http://www.houstonamericanenergy.com-- engages in the
acquisition, exploration, exploitation, development, and
production of natural gas and crude oil properties in the U.S.
Gulf Coast region and South America. The Company's oil and gas
properties are located primarily in the South American country of
Colombia; and in the onshore Gulf Coast region of Texas and
Louisiana.
INDIANA: Dental Services Monetary Cap Class Action Ruling Upheld
----------------------------------------------------------------
Jessica M. Karmasek, writing for Legal Newsline, reports that a
federal appeals court ruled last week that Indiana cannot violate
state and federal Medicaid laws, and people without means in the
state must receive "medically necessary" dental treatment.
In its ruling on Sept. 26, the U.S. Court of Appeals for the
Seventh Circuit sided with plaintiff Sandra Bontrager and others
like her in a class action filed against the Indiana Family and
Social Services Administration, or FSSA.
In 2009, Ms. Bontrager's doctors ordered implant treatments --
including two endosteal implants and two implant abutments for her
lower jaw.
When she sought payment of these services through Medicaid, her
claim, although covered and medically necessary, was denied to the
extent her requested treatment exceeded Indiana's $1,000 annual
limit on such services.
Ms. Bontrager was unable to pay for the services on her own.
She subsequently filed a class action complaint in Elkhart County
Superior Court in May 2011.
Ms. Bontrager's lawsuit alleges that the FSSA, which administers
the state's Medicaid program, violated state and federal Medicaid
laws by instituting the $1,000 annual cap on dental services, even
when such services are covered and medically necessary.
Her attorney, Jacquelyn Bowie Suess for the American Civil
Liberties Union of Indiana, said even though the agency had denied
Ms. Bontrager's claim, saying the requested services were not
"covered dental services," it was clear the treatments her doctors
ordered were both medically necessary and covered under the
program.
"The $1,000 cap is often the only reason people without means
don't receive dental treatment ordered by their doctors -- care
that can well exceed that small subsidy," Ms. Suess said in a
statement Wednesday.
In a ruling last year, the U.S. District Court for the Northern
District of Indiana granted Ms. Bontrager's request for a
preliminary injunction.
The court held that Indiana is required to cover all medically
necessary dental services, irrespective of the monetary cap.
The Seventh Circuit affirmed.
The court said it agreed with the district court that the cap
prevents the state from providing coverage for all medically
necessary services, and partial payment for such services does not
constitute "some coverage."
"The State's monetary contribution has no effect (i.e., the State
ends up paying nothing) and the Medicaid recipient is left without
recourse," Judge Michael Stephen Kanne wrote in the court's 16-
page opinion.
"And if the indigent individual has already used a portion of her
$1,000 allotment toward other dental services, she would be
required to come up with even more money to pay for the
procedure."
Ms. Suess said the ACLU was "thrilled" with the Seventh Circuit's
ruling, adding that proper health care "makes an enormous impact
on quality of life."
Jane Henegar, executive director of ACLU of Indiana, added, "The
civil liberties guaranteed to each one of us prevents government
from unfairly and arbitrarily limiting services.
"The role of the ACLU of Indiana in this case is to ensure that
the State doesn't shirk its responsibilities under state and
federal law by denying health care treatments it has already said
it would provide."
LOCAL.COM CORP: "Bernstein" Class Action Suit Dismissed in May
--------------------------------------------------------------
The class action lawsuit filed by Matthew Bernstein against
Local.com Corporation was dismissed without prejudice in May 2012,
according to the Company's August 9, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2012.
On March 22, 2012, a putative class action lawsuit was filed in
the United States District Court for the Southern District of
California against Local.com Corporation, by Matthew Bernstein and
other alleged to be similarly situated. The complaint alleges
that Local.com Corporation violated California Penal Code Section
632 by allegedly recording a conversation with Plaintiff Bernstein
without his consent, as well as similar claims such as alleged
invasion of privacy, alleged negligence, and alleged unlawful,
fraudulent and unfair business acts. The complaint was dismissed
without prejudice on May 21, 2012.
MI WINDOWS: Sues Insurers for Class Action Coverage
---------------------------------------------------
HarrisMartin reports that MI Windows & Doors has sued several of
its insurers for coverage of class action lawsuits alleging that
windows manufactured by the company are defective and caused
damage to homes throughout the country.
In a declaratory judgment action filed recently in Florida, MI
contends that the insurers have failed to provide a complete
defense, and in some cases any defense at all, against the
lawsuits, which have been consolidated in a multidistrict
litigation proceeding pending in U.S. District Court for the
District of South Carolina.
PELLA CORP: Seeks to Thwart Class Action Settlement Talks
---------------------------------------------------------
Juan Carlos Rodriguez, writing for Law360, reports that window
maker Pella Corp. on Sept. 26 asked a federal judge to toss an
effort to restart settlement talks made by consumers who object to
a proposed agreement in a lawsuit over alleged defects in millions
of the company's windows.
The company and a group of class members agreed to a settlement in
August and have asked the judge in the case to approve it, but
other class members objected, saying the settlement doesn't appear
to be reasonable and doesn't specify a total amount of money.
RELIANT ENERGY: Nevada Loses Natural Gas Class Action Bid
---------------------------------------------------------
Cy Ryan, writing for Las Vegas Sun, reports that the Nevada
Supreme Court has rejected the appeal of the state and consumers
that natural gas and electric customers in Southern Nevada were
charged inflated rates in a price-rigging scheme during the energy
crisis.
The state Bureau of Consumer Protection and customers joined in
filing a class-action suit that alleged Reliant Energy and its
affiliated companies made "a secret deal" with now defunct
bankrupt Enron Corp. that drove up natural gas prices.
The court, in an opinion authored by Chief Justice Michael Cherry,
said, "Due in part to significant manipulation of the natural gas
markets from 2000 to 2001, natural gas and electricity prices
skyrocketed in Nevada and other Western states."
But the court agreed with District Judge Kathy Hardcastle, who
dismissed the class-action suit on grounds it came under federal
jurisdiction. The suit alleged Reliant of Texas violated Nevada's
antitrust laws.
An investigation was conducted by the Federal Energy Regulatory
Commission, which said it had jurisdiction over the sales of
Reliant but found the company had not violated federal
regulations.
The federal commission said its regulations lacked explicit
guidelines or prohibitions against Reliant's market manipulations.
Southwest Gas in Las Vegas paid for the gas at inflated prices.
And the suit maintained the "artificially inflated price of
natural gas" drove up electric rates because NV Energy used
natural gas to produce part of its energy.
There was no estimate in court documents of how much Las Vegas
rate payers were overcharged.
SHAW GROUP: Sued Over Proposed Chicago Bridge & Iron Merger
-----------------------------------------------------------
Courthouse News Service reports that The Shaw Group is planning a
$3 billion merger with Chicago Bridge & Iron that does not
maximize shareholder value, a class claims in court.
SKECHERS USA: "Stalker" Plaintiff Awaits Ruling on Grabowski Deal
----------------------------------------------------------------
Skechers U.S.A., Inc. is awaiting a court decision on a motion for
preliminary approval of a class action settlement, to which Sonia
Stalker and her counsel has opposed, according to the Company's
August 9, 2012, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2012.
On July 2, 2010, Sonia Stalker filed an action against the Company
in the Superior Court of the State of California for the County of
Los Angeles, Sonia Stalker v. Skechers U.S.A., Inc., on her behalf
and on behalf of all others similarly situated, alleging that the
Company's advertising for Shape-ups violates California's Unfair
Competition Law and the California Consumer Legal Remedies Act.
The complaint seeks certification of a nationwide class, actual
and punitive damages, restitution, declaratory and injunctive
relief, corrective advertising, and attorneys' fees and costs. On
July 23, 2010, the Company removed the case to the United States
District Court for the Central District of California, and it is
now pending as Sonia Stalker v. Skechers USA, Inc., CV 10-5460 JAK
(JEM). On August 23, 2010, the Company filed a motion to dismiss
the action or transfer it to the United States District Court for
the Southern District of California, in view of the prior pending
action filed by Tamara Grabowski. On August 27, 2010, the
plaintiff moved to certify the class, which motion the Company
opposed. On January 21, 2011, the Court stayed the action for the
separate reasons that the Grabowski action was filed first and
takes priority under the first-to-file doctrine and that the
outcomes in pending appeals in two unrelated actions will
significantly affect the outcome of plaintiff's motion for class
certification and the resolution of this action. On May 21, 2012,
this action was transferred to the multidistrict litigation
proceeding pending in the United States District Court for the
Western District of Kentucky, entitled In re Skechers Toning Shoe
Products Liability Litigation, MDL No. 2308. On June 7, 2012, the
plaintiff and her counsel filed an opposition to the motion for
preliminary approval of the Grabowski/Morga class actions
settlement. The Court held hearings on the motion for preliminary
approval of the class action settlement on July 24 and August 3,
2012, and a further hearing was scheduled for August 10, 2012.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Stalker. If the motions to grant
preliminary and final approval of the class action settlement in
the Grabowski/Morga class actions are denied or approval is
reversed on appeal, the Company cannot predict the outcome of the
Stalker action or a reasonable range of potential losses or
whether the outcome of the Stalker action would have a material
adverse impact on the Company's results of operations or financial
position in excess of the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
SKECHERS USA: Class Certification Bid in "Lovston" Suit Pending
---------------------------------------------------------------
A renewed motion for class certification in the lawsuit commenced
by Terena Lovston is pending in Arkansas, according to Skechers
U.S.A., Inc.'s August 9, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2012.
On May 13, 2011, Terena Lovston filed a lawsuit against the
Company in the Circuit Court in Lonoke County, Arkansas, Terena
Lovston v. Skechers U.S.A., Inc., Case No. CV-11-321. The
complaint alleges, on her behalf and on behalf of all others
similarly situated, that the Company's advertising for its toning
footwear products violates Arkansas' Deceptive Trade Practices
Act, and is resulting in unjust enrichment. The complaint seeks
certification of a statewide class and compensatory damages. On
June 3, 2011, the Company removed the case to the United States
District Court for the Eastern District of Arkansas. On June 6,
2011, the Company filed a motion to dismiss the action or transfer
it to the United States District Court for the Southern District
of California, in view of the then-prior pending action filed by
Tamara Grabowski. On July 19, 2011, the Court indicated its
intent to remand the case to Arkansas state court but stayed
remand pending further briefing by the parties. On August 5,
2011, the Court issued an order staying the case pending
completion of the appellate process in the action filed by Patty
Tomlinson. On November 7, 2011, the United States Supreme Court
denied the Company's petition for a writ of certiorari in the
Tomlinson action. On July 12, 2012, the district court ordered
the Lovston case remanded to Arkansas state court, and on or about
July 26, 2012, the plaintiff filed a renewed motion for
certification of a class of Arkansas residents who purchased the
Company's toning footwear products.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Lovston. If the motions to grant
preliminary and final approval of the class action settlement in
the Grabowski/Morga class actions are denied or approval is
reversed on appeal, the Company cannot predict the outcome of the
Lovston action or a reasonable range of potential losses or
whether the outcome of the Lovston action would have a material
adverse impact on its results of operations or financial position
in excess of the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
SKECHERS USA: "Hochberg" Suit Transferred to Toning Shoes MDL
-------------------------------------------------------------
The class action lawsuit initiated by Wendie Hochberg and Brenda
Baum was transferred in July 2012 to the multidistrict litigation
proceeding over Skechers U.S.A., Inc.'s toning shoes, according to
the Company's August 9, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2012.
On November 23, 2011, Wendie Hochberg and Brenda Baum filed a
lawsuit against the Company in the United States District Court
for the Eastern District of New York, Wendie Hochberg and Brenda
Baum v. Skechers U.S.A., Inc., Case No. CV11-5751. The complaint
alleges, on their behalf and on behalf of all others similarly
situated, that the Company's advertising for Shape-ups violates
the New York Consumer Protection Act, and is resulting in unjust
enrichment. The complaint seeks certification of a statewide
class, damages, restitution, disgorgement, injunctive relief, and
attorneys' fees and costs. On July 5, 2012, this action was
transferred to the multidistrict litigation proceeding pending in
the United States District Court for the Western District of
Kentucky, entitled In re Skechers Toning Shoe Products Liability
Litigation, MDL No. 2308.
The Company says the settlement in the Grabowski/Morga class
actions, if finally approved by the Court and affirmed on appeal
in the event an appeal is taken, is expected entirely to resolve
the class claims brought by the plaintiff in Hochberg. If the
motions to grant preliminary and final approval of the class
action settlement in the Grabowski/Morga class actions are denied
or approval is reversed on appeal, the Company cannot predict the
outcome of the Hochberg action or a reasonable range of potential
losses or whether the outcome of the Hochberg action would have a
material adverse impact on its results of operations or financial
position in excess of the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
SKECHERS USA: Judge Has Yet to Be Assigned in "Angell" Class Suit
-----------------------------------------------------------------
A presiding judge has not yet been assigned to the proposed class
action lawsuit filed by Jason Angell in Canada, according to
Skechers U.S.A., Inc.'s August 9, 2012, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended June
30, 2012.
On April 12, 2012, Jason Angell filed a motion to authorize the
bringing of a class action in the Superior Court of Quebec,
District of Montreal, captioned Jason Angell v. Skechers U.S.A.,
Inc., Skechers U.S.A., Inc. II and Skechers U.S.A. Canada, Inc.
Petitioner Angell seeks to bring a class action on behalf of all
residents of Canada (or in the alternative, all residents of
Quebec) who purchased Skechers Shape-ups footwear. Petitioner's
motion alleges that the Company has marketed Shape-ups through the
use of false and misleading advertisements and representations
about the products' ability to provide health benefits to users.
The motion requests the Court's authorization to institute a class
action seeking damages, punitive damages, and injunctive relief.
Petitioner's motion was formally presented to the Court on June
29, 2012. A presiding judge has not yet been assigned to the
case.
While it is too early to predict the outcome of the litigation or
a reasonable range of potential losses and whether an adverse
result would have a material adverse impact on its results of
operations or financial position, the Company believes it has
meritorious defenses, vehemently denies the allegations, believes
that authorization of a class action is not warranted and intends
to defend the case vigorously.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
SKECHERS USA: "Loss" and "Boatright" Suits Consolidated in July
---------------------------------------------------------------
Skechers U.S.A., Inc. disclosed in its August 9, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2012, that the class action lawsuits
brought by Shannon Loss, et al., and Elma Boatright, et al., were
consolidated in July 2012.
On February 12, 2012, Shannon Loss, Kayla Hedges and Donald Horner
filed a lawsuit against the Company in the United States District
Court for the Western District of Kentucky, Shannon Loss, Kayla
Hedges and Donald Horner v. Skechers U.S.A., Inc., Skechers
U.S.A., Inc. II and Skechers Fitness Group, Case No. 3:12-cv-78-H.
The complaint alleges, on behalf of the named plaintiffs and all
others similarly situated, that the Company's advertising for
Shape-ups is false and misleading, thereby constituting a breach
of contract, breach of implied and express warranties, and
resulting in unjust enrichment. The complaint seeks certification
of a nationwide class, compensatory damages, and attorneys' fees
and costs. On March 9, 2012, the named plaintiffs filed a motion
to consolidate this action with In re Skechers Toning Shoe
Products Liability Litigation, case no. 11-md-02308-TBR. On April
10, 2012, the Company filed a motion to dismiss the action or
transfer it to the United States District Court for the Southern
District of California, in view of the prior pending action filed
by Tamara Grabowski. On May 1, 2012, the Court issued an order
staying the action until the next status conference, which was
held on July 3, 2012. At the July 3 status conference, the Court
granted plaintiffs' motion to consolidate the Loss and Boatright
actions, and accordingly denied the Company's motion to dismiss or
transfer the Loss action as moot.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Loss. If the motions to grant
preliminary and final approval of the class action settlement in
the Grabowski/Morga class actions are denied or approval is
reversed on appeal, the Company cannot predict the outcome of the
Loss action or a reasonable range of potential losses or whether
the outcome of the Loss action would have a material adverse
impact on its results of operations or financial position in
excess of the existing $50 million settlement.
Boatright Action
On February 15, 2012, Elma Boatright and Sharon White filed a
lawsuit against the Company in the United States District Court
for the Western District of Kentucky, Elma Boatright and Sharon
White v. Skechers U.S.A., Inc., Skechers U.S.A., Inc. II and
Skechers Fitness Group, Case No. 3:12-cv-87-S. The complaint
alleges, on behalf of the named plaintiffs and all others
similarly situated, that the Company's advertising for Shape-ups
is false and misleading, thereby constituting a breach of
contract, breach of implied and express warranties, fraud, and
resulting in unjust enrichment. The complaint seeks certification
of a nationwide class, compensatory damages, and attorneys' fees
and costs. On March 6, 2012, the named plaintiffs filed a motion
to consolidate this action with In re Skechers Toning Shoe
Products Liability Litigation, case no. 11-md-02308-TBR. On March
12, 2012, the Company filed a motion to dismiss the action or
transfer it to the United States District Court for the Southern
District of California, in view of the prior pending Grabowski
action. On May 1, 2012, the Court issued an order staying the
action until the next conference, which was held on July 3, 2012.
At the July 3 status conference, the Court granted plaintiffs'
motion to consolidate the Loss and Boatright actions, and
accordingly denied the Company's motion to dismiss or transfer the
Boatright action as moot.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Boatright. If the motions to grant
preliminary and final approval of the class action settlement in
the Grabowski/Morga class actions are denied or approval is
reversed on appeal, the Company cannot predict the outcome of the
Boatright action or a reasonable range of potential losses or
whether the outcome of the Boatright action would have a material
adverse impact on its results of operations or financial position
in excess of the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
SKECHERS USA: "Scovil" Suit Transferred to Toning Shoes MDL
-----------------------------------------------------------
The class action lawsuit initiated by Michele Scovil in Nevada
over Skechers U.S.A., Inc.'s toning shoes was transferred in July
2012 to the multidistrict litigation proceeding in Kentucky,
according to the Company's August 9, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2012.
On April 25, 2012, Michele Scovil filed a lawsuit against the
Company in the District Court for Clark County, Nevada, Michele
Scovil v. Skechers U.S.A., Inc., Case No. A-12660756-C. Plaintiff
alleges that she suffered physical injuries that she attributes to
the allegedly defective design of Shape-ups, and plaintiff
asserts, in her individual capacity, claims for negligence,
products liability, strict liability, and breach of warranty. In
addition, plaintiff also purports to bring a class action on
behalf of all persons in Nevada who purchased Shape-ups shoes at
retail, and seeks class certification on her claims for alleged
violations of the Nevada Unfair and Deceptive Trade Practices Act.
Plaintiff's complaint seeks damages, restitution, punitive
damages, and attorneys' fees and costs. On July 12, 2012, this
action was transferred to the multidistrict litigation proceeding
pending in the United States District Court for the Western
District of Kentucky, entitled In re Skechers Toning Shoe Products
Liability Litigation, MDL No. 2308.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Scovil. While it is too early to
predict the outcome of the remaining claims asserted in this
litigation or a reasonable range of potential losses and whether
an adverse result would have a material adverse impact on its
results of operations or financial position, the Company believes
it has meritorious defenses, vehemently denies the allegations,
believes that class certification is not warranted and intends to
defend the case vigorously. If the motions to grant preliminary
and final approval of the class action settlement in the
Grabowski/Morga class actions are denied or approval is reversed
on appeal, the Company cannot predict the outcome of the Scovil
action or a reasonable range of potential losses or whether the
outcome of the Scovil action would have a material adverse impact
on its results of operations or financial position in excess of
the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/).
SKECHERS USA: "Tomlinson" Class Suit Remains Stayed in Arkansas
---------------------------------------------------------------
The class action lawsuit commenced by Patty Tomlinson remains
stayed in Arkansas, according to Skechers U.S.A., Inc.'s
August 9, 2012, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2012.
On January 13, 2011, Patty Tomlinson filed a lawsuit against the
Company in Circuit Court in Washington County, Arkansas, Patty
Tomlinson v. Skechers U.S.A., Inc., Case No. CV11-121-7. The
complaint alleges, on her behalf and on behalf of all others
similarly situated, that the Company's advertising for Shape-ups
violates Arkansas' Deceptive Trade Practices Act, constitutes a
breach of certain express and implied warranties, and is resulting
in unjust enrichment (the "Tomlinson action"). The complaint
seeks certification of a statewide class, compensatory damages,
prejudgment interest, and attorneys' fees and costs. On February
18, 2011, the Company removed the case to the United States
District Court for the Western District of Arkansas, and it is now
pending as Patty Tomlinson v. Skechers U.S.A., Inc., CV 11-05042
JLH. On March 16, 2011, the Company filed a motion to dismiss the
action or transfer it to the United States District Court for the
Southern District of California, in view of the then-prior pending
Grabowski action. On March 21, 2011, Ms. Tomlinson moved to
remand the action back to Arkansas state court, which motion the
Company opposed. On May 25, 2011, the Court ordered the case
remanded to Arkansas state court and denied the Company's motion
to dismiss or transfer as moot, but stayed the remand pending
completion of appellate review. On September 2, 2011, the Company
filed a petition in the United States Supreme Court seeking a writ
of certiorari relating to the propriety of remand, and on November
7, 2011, the Supreme Court denied the Company's petition. The
district court has yet to lift the stay and formally remand the
case to state court.
The settlement in the Grabowski/Morga class actions, if finally
approved by the Court and affirmed on appeal in the event an
appeal is taken, is expected entirely to resolve the class claims
brought by the plaintiff in Tomlinson. If the motions to grant
preliminary and final approval of the class action settlement in
the Grabowski/Morga class actions are denied or approval is
reversed on appeal, the Company cannot predict the outcome of the
Tomlinson action or a reasonable range of potential losses or
whether the outcome of the Tomlinson action would have a material
adverse impact on its results of operations or financial position
in excess of the existing $50 million settlement.
About Skechers USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs,
develops and markets a diverse range of footwear for men, women
and children under the SKECHERS name. SKECHERS footwear is
available in the United States via department and specialty
stores, Company-owned SKECHERS retail stores and its e-commerce
Web site, and over 100 countries and territories through the
Company's global network of distributors and subsidiaries in
Canada, Brazil, Chile, Japan and across Europe, as well as through
joint ventures in Asia. For more information, please visit
http://www.skechers.com/,and follow the Company on Facebook
(http://www.facebook.com/SKECHERS/)and Twitter
(http://twitter.com/SKECHERSUSA/)
STORM FIN'L: Two Banks Deny Involvement in Investment Scheme
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Daily Mercury reports that two banks have defended their
relationship with Storm Financial and argued a case against them
is weak and inaccurate.
The Bank of Queensland and Macquarie Bank have been accused of
acting unconscionably and being "knowingly concerned" in an
unregistered managed investment scheme.
The Australian Securities and Investments Commission is pursuing
the banks, and Storm, in a trial in the Federal Court in Brisbane.
A class action against the banks, involving some of the hundreds
of investors who lost millions when Storm collapsed in 2008, is
running on the coat tails of this ASIC action.
Victims are arguing the banks acted unconscionably when they lent
millions of dollars to people without considering whether they had
the capacity to pay the money back if the stock market crashed.
The banks have argued Storm was not running a managed investment
scheme and, therefore, they could not have been knowingly
involved.
Macquarie barrister John Sheahan said on Sept. 27 the Storm
failure was well known but the company did not collect money and
did not manage people properly.
He said Storm's model was "confined to advice, monitoring and
ministerial assistance".
"Storm was in business, went into liquidation, many clients lost
money but there is no connection between items two and three," he
said.
"Storm clients did not lose money because of liquidation.
"Storm went into liquidation by its bankers, which all wanted
money back from it."
Barrister Andrew Crowe also told the court the Bank of Queensland
was not aware if Storm was running an unregistered scheme,
pointing to other cases where pooled funds did not amount to a
scheme.
Evidence was expected to begin on Sept. 28.
The trial continues.
SUN DRILLING: Faces Class Action Over Release of Toxic Substances
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Courthouse News Service reports that Sun Drilling Products
Corporate releases harmful levels of benzene and other toxic
substances into the air, a class claims in court.
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S U B S C R I P T I O N I N F O R M A T I O N
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