/raid1/www/Hosts/bankrupt/CAR_Public/121009.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, October 9, 2012, Vol. 14, No. 200
Headlines
ABAXIS INC: BOD Sued for Unjust Enrichment & Breach of Duties
ACCRETIVE HEALTH: Sued Over Violations of Debt Collection Laws
ASSANTE WEALTH: Jensen Shawa Solomon Files Class Action
BMO HARRIS: EEOC Sues Over Inflexible Medical Leave Policy
COMPUCREDIT HOLDINGS: Continues to Defend "Knox" Suit
CONSTELLATION ENERGY: Suit Over Royalty Payments Remains Pending
DENTSPLY INT'L: Must Face Class Action Over Cavitron System
DIAGEO: Lawyers Invite Homeowners to Join "Whisky Fungus" Suit
DIRECTV: Faces Class Action Over Credit Card Default Charges
ENERGY PLUS: Faces Class Action Over Deceptive Advertising
FBR & CO: Appeal From Dismissal Order in Thornburg Suit Pending
FBR & CO: Securities Suit vs. Unit Remains Pending in Colorado
FBR & CO: Unit Continues to Defend Imperial IPO Class Suits
FIRST CALIFORNIA: Suit v. Unit Over Bank Charges Remains Pending
FLEXSTEEL INDUSTRIES: Judge Hears Arguments on Claim Coverage
FRANSHAW INC: Recalls 1,170 Pink Angel Embroidered Girls' Shorts
GOGO: Faces Class Action Over Long-Term Airline Contracts
HARLAND CLARKE: Suits Over LaserPro Software Remain Pending
INDYMAC MORTGAGE: December 18 Settlement Fairness Hearing Set
JPMORGAN CHASE: Bucks County Expects to Get Settlement Payments
KENNY'S FARMHOUSE: Recalls Rose, Bleu, Awe-Brie & Tomme Cheeses
LEHMAN BROTHERS: Class Action Payment Calculation Faces Delay
LG CHEM: Faces Class Action Over Alleged Battery Price-Fixing
MHN GOVERNMENT: Baron & Budd Files Overtime Class Action
ORIENT PAPER: Expects Securities Suit Deal Approval by Year End
PATRIOT COAL: Executives Targeted by Shareholders' Suit
PATRIOT COAL: Still Defends Employee Safety Violations Suit
PHARMACIA CORP: Lexington Files Class Action Over PCBs
POLYMEDIX INC: Faces Securities Class Suit in Pennsylvania
PRIMO WATER: Continues to Defend Securities Class Suit in N.C.
ROSETTA STONE: Still Awaits Approval of Wages Suit Settlement
SACRAMENTO, CA: Homeless People to Get Compensation in Raid Suit
TIM HORTONS: Hearing in Claims Dismissal Appeal to Be Held in 4Q
UBER: Faces Cass Action Over False Price Advertising
UNITED STATES: Supreme Court Mulls Over Identity Theft Liability
WEBMD HEALTH: Seeks Dismissal of Consolidated Securities Suit
WINDSTREAM CORP: Class Cert. Order in Kentucky Suit Appealed
XL FOODS: Faces Class Action Over Beef Recall
ZHONGPIN INC: Defends Class Suits Over Zhu's Proposed Buyout
ZYNGA INC: Removes "Reyes" Securities Suit to N.D. California
*********
ABAXIS INC: BOD Sued for Unjust Enrichment & Breach of Duties
-------------------------------------------------------------
St. Louis Police Retirement System, On Behalf of Itself and All
Others Similarly Situated and Derivatively on Behalf of Nominal
Defendant Abaxis, Inc. v. Clinton H. Severson, Alberto R. Santa
Ines, Kenneth P. Aron, Vladimir E. Ostoich, Donald P. Wood, Martin
V. Mulroy, Richard J. Bastiani, Michael D. Casey, Henk J.
Evenhuis, Prithipal Singh, Vernon E. Altman, and Ernest S. Tucker,
Case No. 4:12-cv-05086 (N.D. Calif., October 1, 2012) is brought
on behalf of stockholders, and derivatively on behalf of nominal
defendant Abaxis, Inc. ("Abaxis" or the "Company") against certain
members of its Board of Directors (the "Board") and certain of its
executive officers seeking to remedy defendants' breaches of
fiduciary duties, unjust enrichment, statutory violations, and
other violations of law.
In gross breach of their fiduciary duties as directors of the
Company, the Grantor Defendants -- Defendants Severson, Bastiani,
Casey, Evenhuis, Singh and Tucker -- have wrongfully caused and
allowed the Company to issue excessive and improper shares of
Company common stock in settlement of restricted stock units
granted to company employees, including the Officer Defendants --
Defendants Severson, Santa Ines, Aron, Ostoich, Wood and Mulroy --
in violation of the Company's 2005 Equity Incentive Plan and at
the expense of the Company and its shareholders, the Plaintiff
contends.
The Plaintiff is a citizen of the state of Missouri and a
shareholder of Abaxis.
Nominal Defendant Abaxis is a California corporation with its
principal place of business in Union City, California. Abaxis
develops, manufactures, markets and sells portable blood analysis
systems for use in the human or veterinary patient-care setting to
provide clinicians with rapid blood constituent measurements. The
Individual Defendants are directors and officers of Abaxis.
The Plaintiff is represented by:
Ramzi Abadou, Esq.
Erik D. Peterson, Esq.
KESSLER TOPAZ MELTZER & CHECK, LLP
One Sansome Street, Suite 1850
San Francisco, CA 94104
Telephone: (415) 400-3000
Facsimile: (415) 400-3001
E-mail: rabadou@ktmc.com
epeterson@ktmc.com
- and -
Eric L. Zagar, Esq.
James H. Miller, Esq.
Matthew A. Goldstein, Esq.
KESSLER TOPAZ MELTZER & CHECK, LLP
280 King of Prussia Road
Radnor, PA 19087
Telephone: (610) 667-7706
Facsimile: (267) 948-2512
E-mail: ezagar@ktmc.com
jmiller@ktmc.com
mgoldstein@ktmc.com
- and -
Joseph E. White, III, Esq.
SAXENA WHITE, P.A.
2424 N. Federal Highway, Suite 257
Boca Raton, FL 33431
Telephone: (561) 394-3399
E-mail: jwhite@saxenawhite.com
ACCRETIVE HEALTH: Sued Over Violations of Debt Collection Laws
--------------------------------------------------------------
Accretive Health, Inc. is facing class action lawsuits alleging
violations of debt collection laws, 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.
Beginning in late April 2012, the Company has been named as a
defendant in several putative securities class actions that have
been filed in the U.S. District Court for the Northern District of
Illinois. The primary allegations are that the Company's public
statements, including filings with the Securities and Exchange
Commission, were false and/or misleading about the Company's
violations of certain federal and Minnesota privacy and debt
collection laws. In addition, the Company and its directors have
been named in several putative shareholder derivative lawsuits
filed in the U.S. District Court for the Northern District of
Illinois and the Circuit Court of Cook County, Illinois. The
primary allegations are that the directors breached their
fiduciary duties in connection with the alleged violations of
certain federal and Minnesota privacy and debt collection laws.
The Company believes that it has meritorious defenses in all of
these cases and intends to vigorously defend itself and directors
against these claims.
ASSANTE WEALTH: Jensen Shawa Solomon Files Class Action
-------------------------------------------------------
Jensen Shawa Solomon Duguid Hawkes LLP (aka JSS Barristers) has
commenced a class action proceeding against Assante Wealth
Management (Canada) Ltd., Assante Capital Management Ltd., Brian
Malley and Christine Malley. The action is advanced on behalf of
individuals who utilized Assante's wealth management and
investment services through its offices in Red Deer, Alberta,
operated and managed by Brian Malley and Christine Malley.
The class action proceeding was commenced by way of Statement of
Claim filed with the Alberta Court of Queen's Bench in Red Deer.
The Statement of Claim alleges that Brian Malley engaged in a
"one-size fits all" investment strategy that was wholly unsuitable
for the investors, and that he acted in his own best interests
which were in conflict with the interests of the class members.
The Statement of Claim alleges that Assante failed to supervise
class member's accounts, and failed to detect or make inquiries
into Mr. Malley's unusual trading patterns.
The Statement of Claim seeks damages for losses suffered in the
amount of $50,000,000, plus general damages in the amount of
$20,000,000, and punitive damages in the amount of $10,000,000,
plus costs and interest.
The issues giving rise to this claim came to light after Brian
Malley was charged with the first-degree murder of one of
Assante's clients for whom he acted as investment advisor.
JSS Barristers provides litigation services to both commercial and
individual clients. The firm's lawyers appear at all levels of
Court in Alberta and Canada.
For further information:
Carsten Jensen, Q.C.
Telephone: (403) 571-1526
E-mail: jensenc@jssbarristers.ca
Rob Armstrong
Telephone: (403) 571-1525
E-mail: armstrongr@jssbarristers.ca
BMO HARRIS: EEOC Sues Over Inflexible Medical Leave Policy
----------------------------------------------------------
The U.S. Equal Employment Opportunity Commission filed a class-
action lawsuit against BMO Harris Bank, alleging it violated the
Americans with Disabilities Act when it fired four employees who
had exhausted their medical leave but could have returned to work
weeks later with a little more flexibility.
In its complaint, the EEOC said it filed suit against BMO Harris
after concluding a one-year negotiating period that began in
August 2011 and ended without resolution. The lawsuit was filed
Sept. 28 in U.S. District Court in Chicago.
The complaint alleges that BMO Harris "has maintained an
inflexible medical leave policy which does not provide for
reasonable accommodation of qualified individuals with
disabilities and which instead provides for termination of their
employment."
The lawsuit cites four bank employees who were incapacitated with
different maladies in 2006, 2007 and 2009, exhausted their medical
leave time but then were able to return their jobs within weeks
afterward only to find they'd been let go.
The EEOC asks for an injunction halting the discriminatory
practices and compensation for the four employees, as well as
other qualified employees who lost their jobs for similar reasons.
In an e-mail, a bank spokesman wrote, "We are working closely and
cooperatively with the EEOC to research and resolve this matter."
He declined to comment further.
The four ex-workers whose rights the EEOC said BMO Harris violated
were:
* Regina Sanders, a senior administrative assistant who took
medical leave to treat colon cancer in May 2006 and then tried to
return to work in February 2007. BMO Harris filled her position
in the meantime and failed to consider her for other open
positions "for which she was qualified," the complaint said.
* Patty Araceli Hurtado, a customer service representative, took
medical leave in April 2006 for treatment of Bell's palsy, anxiety
disorder and depression. She told the bank she could return on
Nov. 22, 2006, but one week before her scheduled return, she was
replaced, according to the complaint.
* Cynthia Pickens, a personal banker, took medical leave in May
2007 for treatment of post traumatic stress disorder and resulting
panic attacks. She was cleared to return to work six weeks after
her medical leave expired in August, but the bank had filled her
job, according to the complaint.
* Erika Rodriguez, a personal banker, began taking intermittent
leave in June 2009 due to asthma attacks. After exhausting her
job-protected medical leave in February 2010, she had to take
personal days to cope with her asthma. The bank fired her "for
taking too many personal leave days to recover from asthma
attacks," according to the complaint.
BMO Harris is Chicago's second-largest bank by deposits and
employs more than 12,000 nationwide.
COMPUCREDIT HOLDINGS: Continues to Defend "Knox" Suit
-----------------------------------------------------
CompuCredit Holdings Corporation continues to defend itself and
its subsidiaries against a class action lawsuit commenced by Knox,
et al., 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.
CompuCredit Corporation and five of the Company's other
subsidiaries are defendants in a purported class action lawsuit
entitled Knox, et al., vs. First Southern Cash Advance, et al.,
No. 5 CV 0445, filed in the Superior Court of New Hanover County,
North Carolina, on February 8, 2005. The plaintiffs allege that
in conducting a so-called "payday lending" business, certain
subsidiaries within the Company's Retail Micro-Loans segment (the
operations of which were sold in October 2011, subject to the
Company's retention of liability for this litigation) violated
various laws governing consumer finance, lending, check cashing,
trade practices and loan brokering. The plaintiffs further allege
that CompuCredit Corporation was the alter ego of the subsidiaries
and is liable for their actions. The plaintiffs are seeking
damages of up to $75,000 per class member, and attorney's fees.
These claims are similar to those that have been asserted against
several other market participants in transactions involving small-
balance, short-term loans made to consumers in North Carolina. On
January 23, 2012, among other orders, the trial court denied the
defendants' motion to compel arbitration, and granted the
plaintiffs' motion for class certification. The Company is
vigorously defending this lawsuit.
Based in Atlanta, Georgia, CompuCredit Holdings Corporation --
http://www.compucredit.com/-- provides credit and related
financial services and products to underserved consumer credit
market in the United States. The Company contracts with third-
party financial institutions to purchase the receivables relating
general purpose consumer credit cards issued by financial
institutions on a daily basis. It was founded in 1996.
CONSTELLATION ENERGY: Suit Over Royalty Payments Remains Pending
----------------------------------------------------------------
On October 28, 2011, Jerry and Betty Wattenbarger and Patricia
Webb, individually and as class representatives on behalf of
similarly situated persons, filed a Class Action petition in the
District Court of Nowata County, Oklahoma, against Constellation
Energy Partners LLC, CEP Mid-Continent, LLC, a subsidiary of the
Company, and Newfield Exploration Mid-Continent, Inc., alleging
Plaintiffs own oil, gas and mineral interests in lands and wells
located in Nowata County, Oklahoma, subject to oil and gas leases
owned and operated by Defendants and that Defendants have
underpaid royalties due and owing on the true value received or
that should have been received by Defendants for production from
Plaintiffs' mineral interests. Plaintiffs have alleged, among
other things, breach of implied covenant to market; breach of
express and implied lease obligations; violation of statutory law;
breach of duty of good faith and fair dealing and of the duty to
act as a reasonably prudent operator; breach of fiduciary duty;
constructive fraud and failure to disclose facts surrounding
deductions made from royalty payments. Plaintiffs seek
certification of a statewide class of plaintiffs, specify that the
class claims against the Company and its subsidiary relate to the
proper payment for production occurring on or after February 1,
2007, and currently limit damage claims against all Defendants to
no more than $75,000 with respect to each Plaintiff and no more
than $5 million in the aggregate for the Plaintiffs and the
individual putative class members, in each case exclusive of
interest and costs, but inclusive of any attorneys' fees. On
December 1, 2011, the case was removed by Defendants to the United
States District Court for the Northern District of Oklahoma, and
on December 28, 2011, Defendants filed their answer to Plaintiff's
petition.
No further 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.
DENTSPLY INT'L: Must Face Class Action Over Cavitron System
-----------------------------------------------------------
MassDevice reports that Dentsply International can't escape a
putative class action lawsuit accusing it of selling defective
Cavitron ultrasonic teeth-cleaning tools, a federal judge in
Pennsylvania ruled.
The lawsuit, filed in the U.S. District Court for Eastern
Pennsylvania, alleges that the dental device company failed to
inform its customers that the Cavitron system required an aseptic
water source to prevent the growth of biofilm within the device.
"Beginning with the 2006 Cavitron models, Dentsply changed its
instructions for the Cavitron, stating that Cavitrons should not
be used where asepsis (the state of being free of pathogenic
microorganisms) is required, recommended, but did not require, the
use of a bleach, sodium hypochlorite, in flushing the system
periodically, which could only be accomplished by the purchase and
use of additional equipment from Dentsply or another
manufacturer," according to court documents. "Dentsply did not,
however, change its instructions or warnings to state that
Cavitrons should not be connected to a public water system, and
did not provide any warnings concerning the dangers of biofilm
formation, its accumulation within the Cavitron's internal and
concealed waterlines, and the contamination of dental treatment
water from bacterial pathogens in the biofilm."
DIAGEO: Lawyers Invite Homeowners to Join "Whisky Fungus" Suit
--------------------------------------------------------------
Fife Today reports that homeowners living within a mile of the
Diageo warehousing site in Leven are to be invited to join a
multi-million pound action against the drinks firm.
Lawyers behind the moves are planning to hold an invitation-only
meeting in Leven in late October to discuss "whisky fungus", which
they claim can blight properties near to where whisky is stored
for fermentation.
A similar meeting recently in Bonnybridge, near Falkirk, attracted
300 people, 47 of whom have signed up for a 'class action' against
Diageo.
American lawyer Bill McMurry, who is already battling bourbon
distillers in Kentucky, wants to sue for compensation for damage
to property caused by the spread of the harmless but unsightly
black fungus, which can cover the outside of houses as well as
gutters, decking, paving and fences.
He said they were pursuing a property damage claim, estimating
potential payouts of between GBP500 and GBP1000 for each case.
He also wants to force distillers to fit equipment that will
capture the ethanol and convert it into CO2.
Mr. McMurray is working with Edinburgh-based lawyers Balfour &
Manson.
He insists there is scientific evidence that shows property has
been damaged as a result of ethanol being released into the
atmosphere from warehouses during the whisky fermentation process,
an evaporation that the industry poetically calls the "angels'
share".
"In an area of around a mile radius, we see varying degrees of
whisky fungus, depending on wind and moisture content,"
Mr. McMurray said. "Lots of people have questions and my purpose
is to answer them and explain our work in the States."
He estimated approximately 2,000 tonnes of ethanol would be put
into the atmosphere from a warehousing facility such as Diageo's
in Leven.
The legal team says a number of other communities are affected by
the mould, including Tullibody, Kilmarnock and Shieldhall.
A Diageo spokesperson said: "As an industry committed to the
highest standards of environmental responsibility, there is
continual research into our processes.
"This research has found a complex range of naturally occurring
microflora at warehouse sites and that the same microflora is
present widely across the environment in the UK.
"No direct association between ethanol and microflora was found.
"Instead, the microflora appears to grow wherever the prevailing
environmental conditions (such as light, moisture, temperature,
nutrients) support that growth.
"If there is a change to the scientific evidence, we can assure
you the industry would consider what the most appropriate,
proportionate and effective way forward might be."
The industry body Scotch Whisky Association maintains it was too
simplistic to say it was one particular thing that caused the
fungal growth and then make a link to the whisky industry.
It argued a range of factors was involved and, as a result, cases
could be found across the UK that were not located beside
warehousing sites.
DIRECTV: Faces Class Action Over Credit Card Default Charges
------------------------------------------------------------
Courthouse News Service reports that DirecTV charges credit cards
on record for delinquent payments without verifying that the
cardholders are affiliated with the account in default, a class
claims in court.
ENERGY PLUS: Faces Class Action Over Deceptive Advertising
----------------------------------------------------------
Matt Fair, writing for Law360, reports that an NRG Energy Inc.
unit was hit with a putative class action in Pennsylvania state
court on Oct. 1 alleging the company conned prospective customers
into switching their electricity provider with deceptive
advertising and the promise of low rates before later jacking up
prices.
Philadelphia resident Christina Harley filed suit against Energy
Plus Holdings LLC in the Philadelphia Court of Common Pleas
alleging that after switching her electrical service to Energy
Plus in 2010 on promises of discounted rates and customer rewards,
the company quickly increased its prices.
FBR & CO: Appeal From Dismissal Order in Thornburg Suit Pending
---------------------------------------------------------------
An appeal from a court ruling dismissing FBR & Co.'s principal
U.S. broker-dealer subsidiary from the lawsuit styled In Re
Thornburg Mortgage, Inc. Securities Litigation remains pending,
according to FBR & Co.'s August 9, 2012, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended June
30, 2012.
In May 2008, the lead plaintiff in a previously filed and
consolidated action filed an amended consolidated class action
complaint that, for the first time, named Friedman, Billings,
Ramsey & Co., Inc. (now FBR Capital Markets & Co. ("FBRCM"), the
Company's principal U.S. broker-dealer subsidiary) and eight other
underwriters as defendants. The lawsuit, styled In Re Thornburg
Mortgage, Inc. Securities Litigation and pending in the United
States District Court for the District of New Mexico, was
originally filed in August 2007 against Thornburg Mortgage, Inc.
("TMI"), and certain of its officers and directors, alleging
material misrepresentations and omissions about, inter alia, the
financial position of TMI. The amended complaint included claims
under Sections 11 and 12 of the Securities Act against nine
underwriters relating to five separate offerings (May 2007, June
2007, September 2007 and two offerings in January 2008). The
allegations against FBRCM related only to its role as underwriter
or member of the syndicate that underwrote TMI's total of three
offerings in September 2007 and January 2008 -- each of which
occurred after the filing of the original complaint -- with an
aggregate offering price of approximately $818,000. The
plaintiffs sought restitution, unspecified compensatory damages
and reimbursement of certain costs and expenses. Although FBRCM
is contractually entitled to be indemnified by TMI in connection
with this lawsuit, TMI filed for bankruptcy on May 1, 2009, and
this likely will decrease or eliminate the value of the indemnity
that FBRCM receives from TMI. On June 2, 2011, the Court granted
FBRCM's motion to dismiss the consolidated class action complaint
as to FBRCM and then entered final judgment for FBRCM on July 25,
2011. Plaintiffs filed a timely notice of appeal to the 10th
Circuit Court of Appeals, challenging the District Court's
findings; briefing on the appeal was expected to be completed last
August 2012. On July 20, 2012, Plaintiffs filed a motion to
voluntarily dismiss with prejudice the claims relating to the
January 2008 offering; that motion is pending at the Court of
Appeals. The claims against FBRCM relating to the September 2007
offering remain on appeal.
FBR & CO: Securities Suit vs. Unit Remains Pending in Colorado
--------------------------------------------------------------
FBR Capital Markets & Co. ("FBRCM"), FBR & Co.'s principal U.S.
broker-dealer subsidiary, has been named a defendant in the
putative class action lawsuit MHC Mutual Conversion Fund, L.P. v.
United Western Bancorp, Inc., et al. pending in the United States
District Court for the District of Colorado. The complaint, filed
in March 2011 against United Western Bancorp, Inc. (the "Bank"),
its officers and directors, underwriters and outside auditors,
alleges material misrepresentations and omissions in the
registration statement and prospectus issued in connection with
the Bank's September 2009 offering. The complaint alleges claims
under Sections 11 and 12 of the Securities Act against the lead
underwriter of the offering and FBRCM as a member of the
underwriting syndicate. Although FBRCM is contractually entitled
to be indemnified by the Bank in connection with this lawsuit, the
Bank filed for bankruptcy on March 5, 2012, and this likely will
decrease or eliminate the value of the indemnity that FBRCM
receives from the Bank.
No further 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.
Although the case is at a preliminary stage, based on management's
review with counsel and present information currently known by
management, resolution of such matters is not expected to have a
material effect on the Company's financial condition, results of
operations, or liquidity.
FBR & CO: Unit Continues to Defend Imperial IPO Class Suits
-----------------------------------------------------------
FBR Capital Markets & Co. ("FBRCM"), FBR & Co.'s principal U.S.
broker-dealer subsidiary, has been named a defendant in four
putative class action lawsuits all alleging substantially
identical claims against Imperial Holdings, Inc. ("Imperial"), its
officers and directors and underwriters for material
misrepresentations and omissions in the registration statement and
prospectus issued in connection with Imperial's February 2011
initial public offering. The cases of Martin J. Fuller v.
Imperial Holdings, Inc., et al. and City of Roseville Employees
Retirement System v. Imperial Holdings, et al, filed in the
Circuit Court of the 15th Judicial Circuit in and for Palm Beach
County, Florida, have been removed to the United States District
Court, Southern District of Florida. Subsequently, two additional
complaints, alleging substantially identical claims, have been
filed in the Southern District of Florida (Sauer v. Imperial
Holdings, et al. and Pondick v. Imperial Holdings, et al.). The
complaints, alleging claims under Sections 11 and 12 of the
Securities Act against the lead underwriters of the offering will
likely be consolidated. Imperial has assumed its contractual
obligation to indemnify the underwriters.
No further 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.
Although the case is at a preliminary stage, based on management's
review with counsel and present information currently known by
management, resolution of such matters is not expected to have a
material effect on the Company's financial condition, results of
operations, or liquidity.
FIRST CALIFORNIA: Suit v. Unit Over Bank Charges Remains Pending
----------------------------------------------------------------
A class action lawsuit against a subsidiary of First California
Financial Group, Inc. remains pending, 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 February 2011, First California Bank was named as a defendant
in a putative class action alleging that the manner in which the
Bank posted charges to its consumer demand deposit accounts
breached an implied obligation of good faith and fair dealing and
violates the California Unfair Competition Law. The action also
alleges that the manner in which the Bank posted charges to its
consumer demand deposit accounts is unconscionable, constitutes
conversion and unjustly enriches the Bank. The action is pending
in the Superior Court of Los Angeles County. The action seeks to
establish a class consisting of all similarly situated customers
of the Bank in the State of California. The case is in early
stages, with no responsive pleadings or motions having been filed.
No class has been certified in the case. A status conference was
scheduled for August 30, 2012.
At this state of the case, the Company says it has not established
an accrual for probable losses as the probability of a material
adverse result cannot be determined and the Company cannot
reasonably estimate a range of potential exposures, if any. The
Company intends to defend the action vigorously.
FLEXSTEEL INDUSTRIES: Judge Hears Arguments on Claim Coverage
-------------------------------------------------------------
Telegraph Herald reports that a Dubuque District Court judge again
heard arguments about whether about a dozen insurance companies
must provide coverage on claims that Flexsteel Industries polluted
air and drinking water near Elkhart, Ind.
In November, Judge Michael Shubatt ruled in favor of Travelers
Property Casualty Company of America and St. Paul Fire & Marine
Insurance Co. that claim no responsibility in a class-action
lawsuit against Flexsteel, which faces allegations that the
company contaminated the water of dozens of Indiana residents.
More than 10 other insurance companies filed "me too" motions for
summary judgment. A different federal court claim, with
practically the same facts, was filed, forcing a separate lawsuit.
All of the involved insurance companies officially stated their
case in a consolidated hearing to the judge on Oct. 2. All
parties appear to agree that this case will eventually be
determined by the Iowa Supreme Court.
FRANSHAW INC: Recalls 1,170 Pink Angel Embroidered Girls' Shorts
----------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Franshaw, Inc., of New York, announced a voluntary recall of about
1,170 Pink Angel Embroidered Girls' Denim Shorts. Consumers
should stop using recalled products immediately unless otherwise
instructed. It is illegal to resell or attempt to resell a
recalled consumer product.
Decorative studs on the denim shorts' pockets can detach and pose
a choking hazard to young children.
Buy Buy Baby received one report of the decorative studs detaching
from the shorts. No injuries have been reported.
This recall involves "Pink Angel" branded embroidered denim shorts
for girl infants and toddlers in sizes 12M to 4T. The shorts come
with a bright pink lace belt and feature two embroidered
butterflies on the left front panel with decorative studs attached
to the front and rear pockets. Style numbers B91540 or B11540 can
be found on the hangtag of the shorts. A picture of the recalled
products is available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml13/13004.html
The recalled products were manufactured in China and sold at Buy
Buy Baby retail locations from January 2012 to July 2012 for about
$10 to $12.
Consumers who have purchased the recalled products will be
refunded. Buy Buy Baby toll-free at (877) 328-9222 any time, or
visit the firm's Web site http://www.buybuybaby.com/and go to the
link Safety and Recalls at the bottom of the homepage for more
information.
GOGO: Faces Class Action Over Long-Term Airline Contracts
---------------------------------------------------------
Matt Reynolds at Courthouse News Service reports that Gogo, the
in-flight Internet provider, stifles competition and stiffs
passengers with long-term airline contracts, a class claims in
federal court.
The first of Gogo's exclusive airline contracts does not expire
until 2018, lead plaintiffs Joel Milne and Joseph Strazzullo say.
This leaves major airlines, and their passengers, stuck with a
provider that charges up to $17.95 for in-flight Internet service,
according to the complaint in the Central District of California.
"These exclusive contracts have the purpose and effect of
thwarting competition on the merits and on price, and have
permitted Gogo to charge supra-competitive prices on consumers
like plaintiffs and the members of the class they seek to
represent," the 22-page complaint states.
Gogo allegedly communicates with commercial planes by using air-
to-ground technology to transmit signals in a "general vertical
direction."
Competing providers use a less expensive satellite-based system
and they offer faster broadband speeds and uninterrupted worldwide
service, according to the complaint.
Southwest Airlines' in-flight Internet provider, Row 44, has an
unlimited satellite based service for $5, according to the
complaint.
Gogo, by comparison, allegedly charges $17.95 for fights longer
than three hours or $9.95 to get online via mobile device.
The "high barriers" to entering the in-flight internet market --
including legal restrictions and regulations, and the cost of
transitioning to a satellite-based system -- have helped cement
Gogo's 85 percent share of the market, the class says.
Gogo is allegedly locked into long-term 10-year exclusive
contracts with AirTran, Alaska Airlines, American Airlines, Delta,
Frontier Airlines, United Airlines, US Airways and Virgin America.
"Rather than achieving or maintaining its monopoly market power
through innovation or competition on the merits, however, Gogo has
achieved or maintained its dominant market power by resorting to
anti-competitive agreements with the airlines on whose planes
Gogo's equipment is placed," the complaint states.
The class is represented by Roy Katriel of San Diego, Calif. It
seeks unspecified compensatory and treble damages for violations
of the Sherman Act, the California Cartwright Act and California's
Business and Professional Code.
Gogo did not immediately respond to a request for comment.
HARLAND CLARKE: Suits Over LaserPro Software Remain Pending
-----------------------------------------------------------
A series of commercial borrowers in various states that allegedly
obtained loans from financial institutions employing LaserPro
software of Harland Financial Solutions' ("HFS"), a wholly owned
subsidiary of Harland Clarke Holdings Corp., have commenced
individual or class actions against their financial institutions
alleging that the loans were deceptive or usurious in that they
failed to disclose properly the effect of the "365/360" method of
calculating interest. In some cases, the financial institutions
have made warranty claims against HFS related to these actions.
Some of the actions commenced by the commercial borrowers have
been dismissed, and many of the remainder, and the related
warranty claims, are at early stages, so that the likely progress
of those pending matters is not yet clear. The Company has not
accepted any of the warranty claims. One of the financial
institutions has commenced an arbitration against the Company
relating to a commercial borrower claim against it under the terms
of the Company's agreement with the financial institution, and
another financial institution has filed a motion in the action
brought by its commercial borrower seeking to assert a third-party
claim against the Company. In the latter action, the Company has
moved to stay the third-party claim pending arbitration. At the
appropriate time, the Company intends to deny liability to both
financial institutions, but the Company is not able at this early
stage to assess whether it may have any liability to either
institution or the amount of any such liability, but it believes
it is remote that either claim will result in material liability.
Due to the preliminary nature of the remaining matters, the
Company believes it is remote that any of the remaining warranty
claims will result in any material liability for the Company.
No further 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.
INDYMAC MORTGAGE: December 18 Settlement Fairness Hearing Set
-------------------------------------------------------------
Berman Devalerio on Oct. 3 provided a Summary Notice of Pendency
of Class Action and Proposed Partial Settlement.
To: All persons or entities who purchased or otherwise acquired
beneficial interests in any of the following certificates and were
allegedly damaged thereby:
IndyMac INDA Mortgage Loan Trust 2006-AR1
IndyMac INDA Mortgage Loan Trust 2006-AR2
IndyMac INDA Mortgage Loan Trust 2006-AR3
IndyMac INDA Mortgage Loan Trust 2007-AR1
IndyMac INDA Mortgage Loan Trust 2007-AR3
IndyMac INDA Mortgage Loan Trust 2007-AR7
IndyMac INDX Mortgage Loan Trust 2006-AR11
IndyMac INDX Mortgage Loan Trust 2006-AR12
IndyMac INDX Mortgage Loan Trust 2006-AR14
IndyMac INDX Mortgage Loan Trust 2006-AR15
IndyMac INDX Mortgage Loan Trust 2006-AR19
IndyMac INDX Mortgage Loan Trust 2006-AR2
IndyMac INDX Mortgage Loan Trust 2006-AR25
IndyMac INDX Mortgage Loan Trust 2006-AR29
IndyMac INDX Mortgage Loan Trust 2006-AR3
IndyMac INDX Mortgage Loan Trust 2006-AR31
IndyMac INDX Mortgage Loan Trust 2006-AR33
IndyMac INDX Mortgage Loan Trust 2006-AR35
IndyMac INDX Mortgage Loan Trust 2006-AR4
IndyMac INDX Mortgage Loan Trust 2006-AR7
IndyMac INDX Mortgage Loan Trust 2006-FLX1
IndyMac INDX Mortgage Loan Trust 2007-AR5
IndyMac INDX Mortgage Loan Trust 2007-FLX1
IndyMac INDX Mortgage Loan Trust 2007-FLX3
IndyMac MBS Home Equity Mortgage Loan
Asset-Backed Trust, Series INABS 2006-D
IndyMac Residential Mortgage-Backed Trust,
Series 2006-L2
Residential Asset Securitization Trust 2006-A2
Residential Asset Securitization Trust 2006-A7CB
Please read this notice carefully. Your rights will be affected
by a class action lawsuit pending in this court.
You are hereby notified, pursuant to an Order of the United States
District Court for the Southern District of New York, that a
Partial Settlement of the Action that will resolve all claims in
the Action against defendants S. Blair Abernathy, John Olinski,
Samir Grover, Simon Heyrick and Victor Woodworth (collectively,
the "Settling Defendants") for $6 million in cash has been
proposed. A hearing will be held on December 18, 2012, at 10:00
a.m., before the Honorable Lewis A. Kaplan, at the United States
District Court for the Southern District of New York, 500 Pearl
Street, New York, New York 10007, Courtroom 21D: (a) to determine
whether the proposed Partial Settlement on the terms and
conditions provided for in the Amended Stipulation and Agreement
of Partial Settlement dated July 31, 2012 (the "Amended
Stipulation") is fair, reasonable, and adequate and should be
approved by the Court; (b) to determine whether the Order and
Final Judgment as provided for under the Amended Stipulation
should be entered dismissing the Action, on the merits and with
prejudice, against the Settling Defendants; (c) to determine
whether the release by the Settlement Class of the Released Claims
against the Released Parties, as set forth in the Amended
Stipulation, should be ordered; (d) to determine whether the
application by Lead Counsel for reimbursement of litigation
expenses incurred to date and an advance on future expenses to
prosecute the remaining claims against the Non-Settling Defendants
(the "Interim Expense Award") should be approved; and (e) to rule
upon such other matters as the Court may deem appropriate.
If you are a member of the class described above, your rights will
be affected by the pending action and the partial settlement, and
you may be entitled to share in the net settlement fund. If you
have not yet received the full printed Notice of Pendency of Class
Action and Proposed Partial Settlement, Settlement Fairness
Hearing and Motion for Reimbursement of Litigation Expenses and
Interim Expenses (the "Notice"), you may obtain a copy of the
Notice by contacting the Claims Administrator: IndyMac Mortgage-
Backed Securities Litigation, c/o Rust Consulting, Inc, P.O. Box
2844, Faribault, MN 55021-8598.
Copies of the Notice can also be downloaded from the Web site
maintained by the Claims Administrator,
http://www.IndyMacMBSclassaction.comor from Lead Counsel's
Web site, http://www.bermandevalerio.com
If you are a member of the Class, in order to be potentially
eligible to share in the distribution of the Net Settlement Fund,
you need not do anything now, but you will be required to submit a
Claim Form at a later date. A subsequent notice will issue with
the Claim Form and instructions after resolution of the remaining
claims against Non-Settling Defendants. To ensure you receive
future notices, please provide the Claims Administrator with
current contact information.
If you are a member of the Class and do not exclude yourself from
the Class, you will be bound by any judgment entered in the Action
whether or not you make a Claim. To exclude yourself from the
Class, you must submit a request for exclusion such that it is
received no later than November 27, 2012, in accordance with the
instructions set forth in the Notice. Any objections to the
proposed Partial Settlement and/or Lead Counsel's application for
reimbursement of litigation expenses and an Interim Expense Award
must be filed with the Court and delivered to Lead Counsel and
counsel for Settling Defendants such that they are received no
later than November 27, 2012, in accordance with the instructions
set forth in the Notice.
PLEASE DO NOT CONTACT THE COURT OR THE CLERK'S OFFICE REGARDING
THIS NOTICE.
Inquiries, other than requests for the Notice, may be made to Lead
Counsel:
Patrick T. Egan, Esq.
Berman DeValerio
One Liberty Square
Boston, MA 01867
Telephone: (800) 516-9926
JPMORGAN CHASE: Bucks County Expects to Get Settlement Payments
---------------------------------------------------------------
Anne Freedman, writing for phillyBurbs.com, reports that Central
Bucks School District and the Bucks County Sewer and Water
Authority may soon see some proceeds from a class-action lawsuit
they were instrumental in filing in 2008.
It accuses 16 financial institutions of illegally conspiring to
fix interest rates related to the purchase of municipal
derivatives.
Pending federal court approval, the antitrust allegations against
two of those companies will be settled for $81.6 million,
according to court documents.
When a public entity issues a bond for a construction project, for
example, it will often invest the proceeds in a variety of
tax-exempt vehicles known as municipal derivatives. In that way,
the entity will receive interest on the funds until they are ready
to be spent for the project.
Generally, according to the class-action lawsuit, a public entity
will engage a broker to "obtain the best possible price for such
derivatives by arranging an auction among multiple providers . . .
."
The lawsuit alleges the financial institutions -- either acting as
sellers or brokers -- engaged in secret, illegal communication
that included "rigging of bids, secret compensation of losing
bidders, courtesy bids, deliberately losing bids and agreements
not to bid," and sharing "the wrongful profits from the illegal
agreement to restrain competition," according to court documents.
"We would get a lower interest rate . . . so our return on
investment would be lower than what the market rate dictated,"
said David Matyas, business administrator for Central Bucks.
A U.S. District Court judge for the Southern District of New York
will decide on Dec. 14 whether proposed settlements from JPMorgan
Chase & Co. of $44.6 million and Wachovia Bank (now known as Wells
Fargo Bank) of $37 million are "fair, reasonable and adequate."
The settlements also set forth an additional $40,000 "incentive
award" to be paid each to Central Bucks School District and the
Bucks County Water and Sewer Authority, and the other named
plaintiffs, the city of Baltimore, the University of Mississippi
Medical Center, the University of Southern Mississippi, the
Mississippi Department of Transportation and the University of
Mississippi.
The payments will be in recognition of their "hands-on"
involvement in the case, assuming the judge approves the
settlements, according to court documents.
It is not known yet how many municipalities, educational
institutions, authorities and other public entities will share in
the settlements, said Jeffrey P. Garton, who is solicitor for both
the Central Bucks School District and the Bucks County Water and
Sewer Authority.
"To my knowledge, there is not a preliminary number at this
point," he said.
Mr. Matyas said the district's share of the class-action
settlement "is not going to be a monumental amount." He said it
would be closer to "tens of thousands of dollars, (rather than)
hundreds of thousands, or millions."
Mr. Garton also said additional settlements should occur in the
future. "There are still some other defendants left that haven't
settled their cases yet," he said.
Previously, on Aug. 27, 2010, Morgan Stanley paid a total of $6.5
million to settle the allegations related to its actions.
The class-action lawsuit had to defer, at times, to the continuing
federal investigation into the bid-rigging allegations by the
Department of Justice, Internal Revenue Service, Securities and
Exchange Commission and about two dozen state attorneys general,
according to the DOJ.
Nineteen individuals have either been convicted or pleaded guilty,
and one more awaits trial in the cases.
In addition, some of the financial institutions have made payments
to settle the charges with those federal and state agencies
resulting from the investigation, including $148 million by
Wachovia/Wells Fargo, $228 million by JPMorgan, $160 million by
UBS AG and $70 million by GE Funding Capital Market Services,
according to the DOJ.
KENNY'S FARMHOUSE: Recalls Rose, Bleu, Awe-Brie & Tomme Cheeses
---------------------------------------------------------------
Kenny's Farmhouse Cheese is voluntarily recalling Kentucky Rose,
Kentucky Bleu, Awe-Brie and Tomme de Nena. This recall is being
made with the knowledge of the FDA. Kenny's Farmhouse Cheese
recalled this product due to possible Listeria monocytogenes
contamination, 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.
To date, there have been no instances of illness reported.
The Kentucky Rose, Kentucky Bleu, Awe-Brie and Tomme de Nena was
sold to farmers markets, restaurants, distributors and retail
stores in FL, IN, IL, KY, OH, TN and VA between August 22, 2012
and September 25, 2012.
Product(s) affected by the recall are:
Product Name Packaging Type/Weight Lot #
------------ --------------------- -----
Kentucky Rose, 8 oz wedge, 3.5 lb, 7.0 lb wedge 120531
bleu cheese or 15 lb wheel, vacuum packed
Kentucky Bleu, 8 oz wheel or 1.5 lb wheel, waxed, 120531
bleu cheese hand wrapped
Kentucky Bleu, 8 oz wheel or 1.5 lb wheel, waxed, 120612
bleu cheese hand wrapped
Awe-Brie, 8 oz wheel or 1.5 lb wheel, 120614
brie cheese hand wrapped
Awe-Brie, 8 oz wheel or 1.5 lb wheel, 120629
brie cheese hand wrapped
Awe-Brie, 8 oz wheel or 1.5 lb wheel, 120716
brie cheese hand wrapped
Tomme de Nena, 8 oz wedge, 3.5 lb or 7.0 lb wedge 120614
tomme cheese or 14 lb wheel, vacuum packed
Tomme de Nena, 8 oz wedge, 3.5 lb or 7.0 lb wedge 120716
tomme cheese or 14 lb wheel, vacuum packed
Pictures of the recalled products are available at:
http://www.fda.gov/Safety/Recalls/ucm322681.htm
Consumers who may have purchased this product should cease
consumption and are urged to return it to the place of purchase
for a full refund.
Retailers, distributors and restaurants are urged to cease sales,
distribution and use of the named cheeses. Please return it to
the place of purchase in exchange for a full refund.
Questions can be directed to Kenny Mattingly, Owner, 270-434-4124
kenny@kennyscheese.com, Monday - Friday 9:00 a.m. 4:00 p.m.
Central Standard Time.
LEHMAN BROTHERS: Class Action Payment Calculation Faces Delay
-------------------------------------------------------------
Kate Kachor, writing for InvestorDaily, reports that the
calculation of compensation amounts has stalled in the Lehman
Brothers class action.
A number of key factors have forced a delay in members of a Lehman
Brothers Australia class action learning the exact amount of
financial compensation they are entitled to, IMF Australia has
said.
The listed litigation funding company informed the market on
Oct. 2 that four key factors stood in the way of the calculation
of possible damages.
"Due to a range of factors, it is not presently possible to
calculate the amounts to which clients of IMF will be entitled
from the liquidation of Lehman, and accordingly, the amounts
payable to IMF," IMF said in a statement to the Australian
Securities Exchange.
The range of factors include whether or not the liquidators of
Lehman will lodge an appeal and whether the claims of clients of
IMF will be assessed through a claims resolution process or
through a contested adversarial process.
It will also depend on whether settlement of the claims of IMF
clients can be reached by agreement -- with or without a claims
resolution process; and also uncertainty as to the final asset and
liability position in liquidation of Lehman.
"IMF will advise the market once it is known whether the
liquidators of Lehman will lodge an appeal and once the process
for determining the claim value of clients of IMF is known," it
said.
On September 21, the Federal Court ruled the claims of 72
councils, charities and not-for-profit and other organizations
were successful.
"While the court delivered reasons for judgment on September 21,
final orders are not likely to be made until November 5, 2012,"
the statement said.
"The liquidators of Lehman may appeal the decision within 28 days
from the date on which final orders are made. The liquidators of
Lehman have not indicated whether an appeal is likely."
In 2009, IMF announced it had funded claims for compensation for
losses suffered by group members arising from the acquisition of
synthetic collateralized debt obligations, also known as CDOs, by
group members from Lehman.
LG CHEM: Faces Class Action Over Alleged Battery Price-Fixing
-------------------------------------------------------------
Courthouse News Service reports that the world's largest
manufacturers of lithium ion rechargeable batteries conspired to
fix prices, a class claims in a suit filed in the United States
District Court for the Northern District of California.
The suit is Kevin Young, Bradley Seldin; Bruce Sterman v. LG Chem;
Panasonic: Sanyo Electric; Sony.
MHN GOVERNMENT: Baron & Budd Files Overtime Class Action
--------------------------------------------------------
On Oct. 2, the national law firm of Baron and Budd filed a class
action lawsuit against MHN Government Services, Inc. (MHNGS) and
Managed Health Network, Inc. (MHN) regarding the misclassification
of employees as independent contractors and the failure to pay
those employees overtime. Filed in the Northern District of
California, the case alleges that MHNGS and MHN violated the Fair
Labor Standards Act (FLSA) by knowingly misclassifying workers to
avoid paying lawful overtime wages. Baron and Budd attorneys
Allen Vaught and Mark Pifko represent the plaintiffs in the case.
"These overtime violation issues are much more common than people
think," said Allen Vaught, head of Baron and Budd's overtime
violations/FLSA litigation section. "Many companies rely on the
workers' lack of knowledge when it comes to the FLSA and actively
choose to misclassify workers in the interest of saving the
business money by unlawfully dodging state and federal wage and
hour laws, payroll taxes, unemployment insurance taxes and other
state and federal requirements."
MHNGS and MHN work at various U.S. military bases as
subcontractors to the United States Department of Defense. MHNGS
and MHN hire individuals to work as Military & Family Life
Consultants, or MFLC's, in order to fulfill those governmental
contracts. Though the companies label MFLC's as "independent
contractors," analysis of the workers' job responsibilities
revealed that the workers should be classified as employees under
the FLSA. Because of this misclassification, the workers were not
paid overtime even though they frequently worked more than 40
hours in a workweek. Under FLSA definitions and exemption rules,
these workers should have been considered employees and should
have been paid overtime.
About Baron & Budd, P.C.
The law firm of Baron & Budd, P.C. -- http://baronandbudd.com--
represents individuals, governmental and business entities in
areas as diverse as water contamination, Gulf oil spill, Qui Tam,
California Proposition 65 violations, unsafe drugs and medical
devices, Chinese drywall, deceptive advertising, consumer
financial fraud, securities fraud and asbestos cancers such as
mesothelioma.
ORIENT PAPER: Expects Securities Suit Deal Approval by Year End
---------------------------------------------------------------
Orient Paper, Inc. said 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 it expects its settlement of a
securities class action lawsuit to be finalized and approved by
the end of 2012.
On August 20, 2010, the Company was served notice of a stockholder
class action lawsuit filed on August 6, 2010, in the U.S. District
Court for the Central District of California against the Company,
certain current and former officers and directors of the Company,
and Roth Capital Partners, LLP. The complaint in the lawsuit,
Mark Henning v. Orient Paper et al., CV-10-5887 RSWL (AJWx),
alleges, among other claims, that the Company issued materially
false and misleading statements and omitted to state material
facts that rendered its affirmative statements misleading as they
related to the Company's financial performance, business
prospects, and financial condition, and that the defendants failed
to prevent such statements from being issued or corrected. The
complaint seeks, among other relief, compensatory damages and
plaintiff's counsel's fees and experts' fees. Mr. Henning
purports to sue on his own behalf and on behalf of a class
consisting of the Company's stockholders (other than the
defendants and their affiliates). One group of three shareholders
with a total alleged loss of approximately $150,000 has filed a
motion to be appointed as lead plaintiff and has been so appointed
by the court. The Company and the defendant officers and
directors have retained the law firm DLA Piper US LLP to represent
them in connection with the lawsuit. The Company believes that
the lawsuit has no merit and intends to mount a vigorous defense.
The plaintiffs filed an amended complaint on January 28, 2011, and
the Company filed a motion to dismiss with the court on March 14,
2011. The plaintiffs subsequently filed their opposition to the
Company's motion to dismiss on April 28, 2011. On July 25, 2011
the court denied the Company's motion to dismiss, thus allowing
the litigation to proceed.
On June 21, 2012, the Company reached a proposed settlement of the
securities class action lawsuit with the plaintiffs. The terms of
the proposed settlement call for dismissal of all the defendants
from the action in exchange for a $2 million payment from the
Company's insurer. The Company expects the settlement to be
finalized and approved by the court by the end of year 2012.
Orient Paper, Inc., was incorporated under the laws of the State
of Nevada on December 9, 2005, under the name of Carlateral, Inc.
Carlateral, Inc. started its business by providing financing
services specializing in subprime title loans, secured primarily
using automobiles as collateral.
PATRIOT COAL: Executives Targeted by Shareholders' Suit
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Patriot Coal Corp. executives are targeted in a class
action lawsuit filed in U.S. District Court in St. Louis that
accused them of violating securities laws by issuing "false and
misleading statements concerning the company's court-ordered
environmental remediation efforts."
According to the report, the lawsuit was filed on behalf of
shareholders who purchased stock between October 2010 and July
2012, when Patriot filed for Chapter 11 reorganization. Patriot
violated accepted accounting principles by capitalizing
environmental costs rather than treating them as expenses,
"thereby overstating the company's financial results," according
to the complaint. Following an investigation by the U.S.
Securities and Exchange Commission, Patriot disclosed in May that
it would restate financial results for 2010 and 2011, increasing
the losses for both years, the shareholders said.
The report relates that because the suit is against Patriot
officers and directors, it wasn't automatically halted by the
company's bankruptcy. Sometimes, companies in Chapter 11 will
call on the bankruptcy judge to stop shareholder suits, saying
they distract managers from working on the reorganization. Aaron
Palash, a spokesman for Patriot, said the company would have no
comment on the suit. Patriot is waiting to learn whether the
bankruptcy will remain in New York or be transferred to St. Louis
or West Virginia, where most of the coal mines are located.
According to Bloomberg, Patriot's $200 million in 3.25% senior
convertible notes due in 2013 traded on Sept. 26 for 16 cents on
the dollar, according to Trace, the bond-price reporting system of
the Financial Industry Regulatory Authority. The $250 million in
8.25% senior unsecured notes due in 2018 traded on Sept. 26 for 50
cents on the dollar.
The shareholder suit is Espinoza v. Whiting, 12-01711, U.S.
District Court, Eastern District of Missouri (St. Louis).
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The case has been assigned to Judge Shelley C. Chapman.
The U.S. Trustee appointed a seven-member creditors committee.
PATRIOT COAL: Still Defends Employee Safety Violations Suit
-----------------------------------------------------------
In late January 2010, the U.S. Attorney's office and the State of
West Virginia began investigations relating to one or more of
Patriot Coal Corporation's employees making inaccurate entries in
official mine records at its Federal No. 2 mine. The Company
terminated one employee and two other employees resigned after
being placed on administrative leave. The terminated employee
subsequently admitted to falsifying inspection records and has
been cooperating with the U.S. Attorney's office. In April 2010,
the Company received a federal subpoena requesting methane
detection systems equipment used at the Company's Federal No. 2
mine since July 2008 and the results of tests performed on the
equipment since that date. The Company has provided the equipment
and information as required by the subpoena. The Company has not
received any additional requests for information.
In January 2012, the terminated employee filed a civil lawsuit
against the Company alleging retaliatory discharge and intentional
infliction of emotional distress. Additionally, in January 2012,
five employees filed a purported class action lawsuit against the
Company and the terminated employee seeking compensation for lost
wages, emotional distress, and punitive damages for the alleged
intentional violation of employee safety at the mine. The Company
is vigorously defending both civil lawsuits and the potential
impact of these lawsuits cannot be estimated at this time.
No further 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.
The Company says the outcome of other litigation and the
investigations is subject to numerous uncertainties. Based on the
Company's evaluation of the issues and their potential impact, the
amount of any future loss cannot be reasonably estimated.
However, based on current information, the Company believes these
matters are likely to be resolved without a material adverse
effect on its financial condition, results of operations and cash
flows.
Patriot Coal Corporation -- http://www.patriotcoal.com/-- engages
in the mining, production, and sale of thermal coal primarily to
electricity generators in the eastern United States. It has
operations and coal reserves in the Appalachia and the Illinois
Basin coal regions. The Company is also involved in the
production of metallurgical quality coal and sells it to steel
mills and independent coke producers. It is based in St. Louis,
Missouri.
PHARMACIA CORP: Lexington Files Class Action Over PCBs
------------------------------------------------------
Brock Parker, writing for The Boston Globe, reports that Lexington
has filed a class action lawsuit in federal court seeking damages
on behalf of itself and other school districts throughout
Massachusetts that are affected by potentially harmful levels of
chemicals known as PCBs.
The suit against Pharmacia Corporation, Solutia Inc. and Monsanto
Company, claims the makers of polychlorinated biphenyls, or PCBs,
knew or should have known the public health and environmental
dangers posed by the use of the chemicals in the construction of
schools from the 1950s through the 1970s and failed to provide
adequate warnings.
The New York law firm of Robert F. Kennedy Jr. and his partner,
Kevin Madonna, is representing Lexington in the suit, which was
filed in U.S. District Court in Boston on Sept. 4.
In a statement on Oct. 3, Monsanto Company said it is aware of
Lexington's complaint, but believes the lawsuit is without merit.
Solutia declined comment and Pharmacia referred questions to
Monsanto.
Mr. Madonna said his law firm is also working with other school
districts in the state with concerns about PCBs, but he declined
to name them until lawsuits have been filed on their behalf. The
firm specializes in environmental litigation and has already
settled a similar suit filed by the Yorktown Central School
District in New York in 2008, Mr. Madonna said.
"This isn't a problem that is limited to the North East," he said.
"We think this is occurring all over the country but schools are
hesitant to affirmatively test for the PCBs for fear of having to
spend millions of dollars in litigation."
Lexington Public Schools temporarily closed its Estabrook
Elementary School in September 2010 when testing revealed elevated
levels of PCBs in the school. Mr. Madonna said Lexington has
since spent millions on remediation to address the PCB levels in
the Estabrook School. The system is in the process of replacing
Estabrook with a new school.
The PCBs are potentially cancer-causing if they build up in the
body over long periods, according to the U.S. Environmental
Protection Agency, and Congress banned the manufacture and most
uses of the chemicals in 1976.
In 2009, the EPA issued a series of guidelines, including testing
procedures, that school administrators should follow to limit
exposure to PCBs, which the agency said were widely used in
construction materials, such as caulk, between 1950 and 1978.
The class action suit seeks to represent all school districts in
the state that have one or more buildings with airborne PCBs in
excess of public health levels established by the EPA. According
to the lawsuit, Massachusetts has almost 1,900 schools and more
than half were built between 1950 and the 1970s.
The school district's lawsuit claims that Monsanto, known since
April of 2000 (cq) as Pharmacia (cq) and now owned by New York-
based Pfizer (cq), was the exclusive manufacturer of PCBS in the
United States from 1935 to 1978 (cq). The suit claims that the
company knew about the toxicity of PCBs as early as the 1930s but
continued to manufacture, sell and promote the products.
As research mounted about the dangers of the chemicals in the
1950s, the company "willfully and callously" failed to provide
adequate warnings of PCB toxicity, and instead downplayed the
dangers of its product in order to protect its profits, according
to the lawsuit.
Mr. Madonna said the goal of the Lexington's suit is to identify
the schools that have elevated levels of PCBs and to have the
manufacturer pay to have them removed.
"It's not fair that taxpayers are potentially being shouldered
with the cost of cleaning up Monsanto's mess," Mr. Madonna said.
Monsanto changed its name to Pharmacia in 2000 (cq), but a spin
off company named Monsanto Ag Company (cq) changed its name to
Monsanto Company the same year.
According to Lexington's lawsuit, Pharmacia, Solutia Inc. and the
present-day Monsanto Company have agreements that have divided the
liabilities arising from the chemical business of Pharmacia when
it was known as Monsanto.
Thomas Helscher (cq), a director of corporate affairs for the
present-day Monsanto Company, said in a statement on Oct. 3 that
PCBs were a legal and useful product several decades ago that were
sold in bulk to manufacturers who used the constituent chemical to
formulate and design a wide variety of products to improve safety
and performance.
He said many building codes required PCBs in electrical equipment
in schools hospitals or buildings where risk of fire was a major
concern.
Mr. Helscher said Monsanto did not have a commercial relationship
with Lexington, and the "duty to warn" theories presented in the
town's lawsuit are not supported by Massachusetts law.
"Moreover, it is our understanding that the school in question was
built over 50 years ago, was poorly maintained, and was scheduled
for demolition years ago since it had outlived its useful life,"
Mr. Helscher said.
Lexington Superintendent of Schools Paul Ash (cq) said the school
district had already planned to replace the Estabrook school by
the end of the decade.
But once the elevated PCB levels were discovered, the district
expedited the process by filing an emergency request seeking
funding from the Massachusetts School Building Authority to help
replace the school. Mr. Ash said the ceremonious groundbreaking
for the construction of the new school will be held Oct. 18 (cq)
and the work is expected to be completed in the spring of 2014
(cq).
Mr. Madonna said it will likely be a while before there is a
resolution to the town's lawsuit.
"These things typically take years," he said.
POLYMEDIX INC: Faces Securities Class Suit in Pennsylvania
----------------------------------------------------------
PolyMedix, Inc. is facing a class action lawsuit in Pennsylvania
alleging securities law violations, 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, 2012, a putative class action was filed against the
Company, and its chief executive officer, chief financial officer,
and a former officer. The action was filed in the United States
District Court for the Eastern District of Pennsylvania,
purportedly on behalf of a class of the Company's investors who
purchased its publicly traded securities between March 7, 2011,
and May 10, 2012. The complaint in this action generally alleges
violations of Section 10(b) of the Securities Exchange Act of 1934
("Exchange Act"), Rule 10b-5 promulgated thereunder and Section
20(a) of the Exchange Act in connection with various public
statements made by the Company. The Company believes these
allegations to be without merit and intends to vigorously defend
this action. The potential impact of this action, which seeks
unspecified damages, attorneys' fees and expenses, is uncertain.
PRIMO WATER: Continues to Defend Securities Class Suit in N.C.
--------------------------------------------------------------
Primo Water Corporation continues to defend itself against a
securities class action lawsuit pending in North Carolina,
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 December 2, 2011, Primo, certain members of the Company's board
of directors, certain members of management, certain shareholders
and company advisors were named as defendants in a purported
class-action lawsuit filed in the United States District Court for
the Middle District of North Carolina. On June 22, 2012,
plaintiffs filed an amended complaint. The amended complaint
alleges violations of Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934, as amended, and Rule 10b-5 promulgated
thereunder, and Sections 11, 12(a)(2), and 15 of the Securities
Act of 1933. The amended complaint asserts claims on behalf of a
class of persons who acquired the Company's common stock in or
traceable to the Company's initial public offering and its
secondary offering as well as purchasers of its common stock
between November 4, 2010, and November 10, 2011. The amended
complaint alleges that defendants violated the federal securities
laws by making misrepresentations about, among other things, the
number of locations where the Company's water exchange services
were offered and where the Company's dispensers were sold, the
performance of its sales locations, location growth opportunities,
various operational issues, and its projected financial results
and business operations in order to artificially inflate the price
of the Company's stock. The amended complaint requests
unspecified damages and costs.
The Company does not believe the lawsuit has merit and plans to
vigorously contest and defend against it. The Company is insured
for potential losses subject to limits. The Company is required
to indemnify each of the named defendants that are party to the
lawsuit against losses and expenses they incur in connection with
the litigation.
ROSETTA STONE: Still Awaits Approval of Wages Suit Settlement
-------------------------------------------------------------
On or about April 28, 2010, a purported class action lawsuit was
filed against Rosetta Stone Inc. in the Superior Court of the
State of California, County of Alameda, for damages, injunctive
relief and restitution in the matter of Michael Pierce, Patrick
Gould, individually and on behalf of all others similarly situated
v. Rosetta Stone Ltd. and DOES 1 to 50. The complaint alleges
that plaintiffs and other persons similarly situated who are or
were employed as salaried managers by the Company in its retail
locations in California are due unpaid wages and other relief for
the Company's violations of state wage and hour laws. Plaintiffs
moved to amend their complaint to include a nationwide class on
January 21, 2011. In November 2011, the plaintiffs' attorneys and
the Company agreed to the mediator's proposed settlement terms,
and as a result, as of September 30, 2011, the Company reserved
$0.6 million for the proposed settlement amount. Approval of the
proposed settlement by the court is pending. The Company disputes
the plaintiffs' claims and it has not admitted any wrongdoing with
respect to the case.
No further 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.
Rosetta Stone Inc. -- http://www.rosettastone.com/-- together
with its subsidiaries, provides technology-based language-learning
solutions in the United States and internationally. The Company
develops, markets, and sells language-learning solutions, such as
software, online services, mobile applications, and audio practice
tools in approximately 30 languages primarily under the Rosetta
Stone brand. The Company was founded in 1992 and is headquartered
in Arlington, Virginia.
SACRAMENTO, CA: Homeless People to Get Compensation in Raid Suit
----------------------------------------------------------------
The Associated Press reports that homeless people are getting
checks for property destroyed during Sacramento police raids on
illegal campsites.
The Loaves & Fishes homeless services complex is one of several
locations where checks ranging from $400 to $750 are being
distributed. Those with addresses are getting checks in the mail.
The Sacramento Bee says the payments resolve a class-action
lawsuit claiming police violated the constitutional rights of
homeless people by seizing and destroying their property during
cleanup operations since 2005.
The federal lawsuit said police officers took bicycles, tents and
other items without giving the owners a chance to get them back.
It's costing taxpayers $796,050 in payments to 1,143 people.
The city is still fighting a requested $1.8 million in legal fees.
TIM HORTONS: Hearing in Claims Dismissal Appeal to Be Held in 4Q
----------------------------------------------------------------
A hearing on the appeal challenging the dismissal of breach of
contract and breach of duty of good faith and fair dealing claims
in a putative class action complaint against Tim Hortons Inc. will
be held in the fourth quarter of 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 July 1, 2012.
On June 12, 2008, a claim was filed against the Company and
certain of its affiliates in the Ontario Superior Court of Justice
(the "Court") by two of its franchisees, Fairview Donut Inc. and
Brule Foods Ltd., alleging, generally, that the Company's Always
Fresh baking system and expansion of lunch offerings have led to
lower franchisee profitability. The claim, which sought class
action certification on behalf of Canadian restaurant owners,
asserted damages of approximately $1.95 billion. Those damages
were claimed based on breach of contract, breach of the duty of
good faith and fair dealing, negligent misrepresentations, unjust
enrichment, price maintenance and waiver of tort. The plaintiffs
filed a motion for certification of the putative class in May of
2009, and the Company filed its responding materials as well as a
motion for summary judgment in November of 2009. The two motions
were heard in August and October 2011. On February 24, 2012, the
Court granted the Company's motion for summary judgment and
dismissed the plaintiffs' claims in their entirety. The Court
also found that certain aspects of the test for certification of
the action as a class proceeding had been met, but all of the
underlying claims were nonetheless dismissed as part of the
summary judgment decision.
While the Court found in favour of the Company on all claims, the
plaintiffs have filed a Notice of Appeal with respect to the
claims for breach of contract, breach of the duty of good faith
and fair dealing, price maintenance and waiver of tort. In the
plaintiffs more recent court filings, they have narrowed their
appeal to include only breach of contract and breach of duty of
good faith and fair dealing. The Company will continue to
vigorously defend against the plaintiffs' claim. A hearing on the
appeal will be held in the fourth quarter of 2012. If all
potential appeals were determined adversely to the Company, the
effect would be that the matters would ultimately proceed to
trial. The Company remains of the view that it would have good
and tenable defences at any such trial, and that the plaintiffs'
claims are without merit and will not be successful. However, if
the matters were determined adversely to the Company at trial, and
that determination was upheld by final order after all appeals, it
is possible that the claims could have a material adverse impact
on the Company's financial statements.
Tim Hortons Inc. -- http://timhortons.com/-- develops,
franchises, and operates quick service restaurants primarily in
Canada and the United States. The Company was founded in 1964 and
is based in Oakville, Canada.
UBER: Faces Cass Action Over False Price Advertising
----------------------------------------------------
Chicago Business Journal reports that Chicago attorney Hall Adams
is adding to Uber's issues by filing a class-action lawsuit
against it on behalf of local passengers.
The complaint, filed Oct. 1 in the Circuit Court of Cook County,
charges San Francisco-based Uber, a taxicab service that uses a
smartphone app to book a sedan or taxi, with false price
advertising and deceptive use of wording in communicating how Uber
makes a profit from each booking.
Uber's business practices are also being disputed in New York City
as well as Washington, D.C.
Travis Kalanick, Uber's CEO, told The New York Times it rejected
any criticisms that the company violated city rules. He told The
Washington Post that the city's concern his service needed
additional oversight could put an end to his business.
The lawsuit states Uber violates Section 2 of the Illinois
Consumer Fraud and Deceptive Business Practices Act through the
"misrepresentation or the concealment, suppression or omission of
any material fact." That is due to the passengers being told they
will be charged a meter rate and a gratuity before they book, and
at the end of the ride, are being charged the total rate without
knowing how much of the gratuity goes to the driver's tip,
according to a press release.
Specifically, Mr. Adams' lawsuit challenges Uber's use of the word
"gratuity," which the complaint alleges includes a driver's tip,
but also the company's fee and a credit card fee. The lawsuit
states the company does not disclose its fees nor how that
gratuity is spent. Chicago taxi ordinances prohibit taxi
companies from charging anything more than the regulated meter
rate, according to the release.
UNITED STATES: Supreme Court Mulls Over Identity Theft Liability
----------------------------------------------------------------
Jesse J. Holland, writing for The Associated Press, reports that
the Supreme Court on Oct. 2 pondered whether it should allow the
federal government to face millions of dollars in class-action
lawsuits for violating identity theft protection laws that ban the
printing of credit card numbers and expiration dates on receipts.
Government lawyers argue that the United States is immune from
being sued for money over violations of the Fair Credit Reporting
Act. But a federal appeal court refused to throw out a class-
action lawsuit from a Chicago lawyer who found part of his credit
card number and the expiration date on his $350 receipt from a
government Web site.
John Jacobs, the lawyer for James X. Bormes, argued in court that
he could use either the FCRA or a second law, the Tucker Act,
which allows the government to be sued in some circumstances, to
negate the government's sovereign immunity.
"If you're right about this, the consequences are enormous,"
Justice Ruth Bader Ginsburg warned.
The federal government is the largest creditor, lender and
employer in the United States, and government lawyers said in
court papers that if Mr. Bormes' suit is allowed, the government
could face "massive liability."
A federal judge in Illinois threw out Mr. Bormes' class-action
lawsuit, saying that Congress did not explicitly waive the federal
government's sovereign immunity in the FCRA. But the lawsuit was
revived by the U.S. Court of Appeals for the Federal Circuit,
which said the Tucker Act supplied the necessary waiver.
Government lawyers argued that the appeals court should have not
looked to a second law, when the FCRA clearly did not make the
government liable for damages.
"The United States is governed by the substance of the (Fair)
Credit Reporting Act," Justice Ginsburg said. "The act applies to
the government, but your point is that there's no sanction for
noncompliance, even though the United States, a government system,
is supposed to conform to the standards in the act?"
"Are we taking the position that even if substantive obligations
run against the United States, there still wouldn't be a remedy,
at least a remedy in damages against the United States? And the
answer to that is yes," said Sri Srinivasan, who argued for the
federal government. "But that's not at all atypical under this
court's sovereign immunity jurisprudence, and it's not at all
atypical for Congress to have fashioned a scheme that runs in that
way."
But Congress must have known that the government could be
affected, Mr. Jacobs said. "Knowing that the government is one of
the largest issuers of credit card receipts, one would have to
wonder why they would want to exclude the government in terms of
protecting the public" with the Fair Credit Reporting Act, Mr.
Jacobs said.
The FCRA prohibits the showing of more than the last five digits
of a card number or the expiration date on a credit card or debit
card receipt, and defines a person liable under the act as "any
individual, partnership, corporation, trust, estate, cooperative,
association, government or governmental subdivision or agency."
Mr. Bormes' court filing receipt from the government's
http://www.pay.govWeb site showed four digits of his credit card
number and the expiration date.
Government lawyers say that since the law doesn't specifically say
the U.S. government, it retains its immunity against lawsuits.
But Mr. Jacobs argued that "any" clearly includes the United
States government.
"The reason that this statute was passed was to protect consumers.
The Congress was clear that if any government violates the
statute, it has this liability," he said.
Justices will make a decision before the end of the term.
WEBMD HEALTH: Seeks Dismissal of Consolidated Securities Suit
-------------------------------------------------------------
WebMD Health Corp. has filed a motion to dismiss the consolidated
lawsuit titled In re WebMD Health Corp. Securities Litigation,
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 2, 2011, and August 26, 2011, federal securities class
action complaints entitled Canson v. WebMD Health Corp., et al.
and Malland v. WebMD Health Corp., et al., respectively, were
filed in the United States District Court for the Southern
District of New York on behalf of purchasers of the Company's
Common Stock between February 23, 2011, and July 15, 2011. On
November 7, 2011, the two cases were consolidated under the
caption In re WebMD Health Corp. Securities Litigation (the
"Federal Securities Action") and lead plaintiffs and lead counsel
were appointed. On February 14, 2012, the lead plaintiffs filed
their consolidated amended complaint (the "Complaint"), which
alleges claims on behalf of purchasers of the Company's securities
between February 23, 2011, and January 10, 2012. The Complaint
alleges that the Company and certain of its officers made false
and misleading statements in violation of the Securities Exchange
Act of 1934 and seeks unspecified damages and costs. The
defendants moved to dismiss the Complaint and the lead plaintiffs
opposed that motion. The motion was fully submitted and filed on
August 2, 2012.
The Company believes that the Federal Securities Action is without
merit and intends to vigorously defend against it. The Company is
unable to predict the outcomes of the action or to reasonably
estimate the possible loss or range of loss, if any, arising from
the claims asserted therein.
WINDSTREAM CORP: Class Cert. Order in Kentucky Suit Appealed
------------------------------------------------------------
Windstream Corporation has taken an appeal from the class
certification order in a lawsuit filed by customers pending 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 June 22, 2009, a putative class action lawsuit was filed in
Kentucky federal district court on behalf of current and former
customers in Kentucky. The complaint alleged that the Company
overcharged customers because it collected a gross receipts
surcharge ("GRS") in violation of state and federal statutes and
tariffs and common law. The court referred state tariff issues to
the Kentucky Public Service Commission ("Kentucky PSC"). In 2011,
the federal court ruled that the GRS was a rate that should have
been listed in the Company's federal tariffs prior to its
collection and that class certification was proper. Based on that
ruling, in third quarter 2011, the Company accrued an amount that
was not material and that represented the amount of loss estimable
and probable at the time. On May 4, 2012, the Kentucky PSC issued
an order also finding the GRS was a rate that should have been in
the Company's local retail tariff before being assessed on certain
types of services. The Company appealed the order to state court
in Franklin County, Kentucky, primarily asserting that the
Kentucky PSC erred in classifying the GRS as a rate.
Additionally, on July 22, 2012, the federal court formally
certified a class of all retail and wholesale Windstream customers
assessed the GRS on services subject to the Company's federal
tariff. The Company appealed class certification to the Sixth
Circuit on July 25, 2012.
Based on a comprehensive analysis of the recent activity regarding
this case, the Company believes its current accrual remains
adequate. The ultimate resolution of the case, the timing of
which is unknown, could result in a loss in a range of $0 to $8.0
million in excess of the amount accrued. The Company plans to
continue to vigorously defend the proceedings.
XL FOODS: Faces Class Action Over Beef Recall
---------------------------------------------
Tony Blais, writing for QMI Agency, reports that an Edmonton man
who claims he became "extremely ill" with E. coli after eating
tainted steak is suing the company that processed the meat, in
what could turn out to be a large class-action lawsuit.
According to a statement of claim filed in court on Oct. 2, and
released on Oct. 3, Matthew Harrison alleges he contracted the
E. coli infection after buying and consuming steak which had been
processed, packaged and stored by Alberta's XL Foods, the beef
manufacturer at the center of the massive meat recalls across the
country.
Mr. Harrison claims he was hospitalized for testing and treatment
after eating some of the beef on Sept. 5 and becoming extremely
ill with symptoms including severe abdominal cramping, vomiting,
headache, fever and diarrhea.
Mr. Harrison also claims he suffered mental distress, emotional
trauma and fear for his health as a result of his illness and the
recall of XL Foods beef products.
According to the statement of claim and to the Canadian Food
Inspection Agency's own timeline of events, E. coli was detected
at the XL Foods plant in Brooks, Alta., on Sept. 4, and the CFIA
issued its first recall of some beef products produced by XL Foods
on Sept. 16.
The recall was extended to more products in the weeks after the
initial recall -- now up to 1,500 products distributed to stores
nationwide -- and on Sept. 28, the CFIA temporarily shut down the
plant.
The lawsuit was filed as a class proceeding and says the class
action "concerns the defendant's negligent quality control,
monitoring, processing, storage, distribution and sale of certain
beef products."
It alleges XL Foods was negligent for failing to ensure its beef
products were safe for consumption, failing to thoroughly test its
beef products, failing to follow quality control processes and
failing to recall all of its tainted beef immediately after
learning people were becoming ill.
The lawsuit also alleges that, despite knowing of the poor quality
control at their Brooks plant, XL Foods concealed this information
from consumers, the general public and regulatory authorities in
order to maintain revenue, increase or maintain profit and avoid
negative publicity.
The lawsuit seeks declarations from XL Foods that the recalled
products were contaminated and that XL Foods is liable for the
damages caused by the recalled products. It also seeks punitive
damages.
None of the allegations have been proven in court.
Ten people in Alberta have become sick since the recalls began in
mid-September. Five patients have been linked to the bacteria
outbreak at XL Foods.
ZHONGPIN INC: Defends Class Suits Over Zhu's Proposed Buyout
------------------------------------------------------------
Zhongpin Inc. is defending class action lawsuits arising from
Xianfu Zhu's proposed buyout of the Company, Zhongpin 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.
On March 27, 2012, the Company announced that its Board of
Directors had received a preliminary, non-binding proposal from
the Company's Chairman and Chief Executive Officer, Xianfu Zhu,
stating that Mr. Zhu intended to seek to purchase the remaining
shares of the Company that he does not presently own (the
"Proposed Buyout"). Following this announcement, at least three
lawsuits have been filed in Delaware naming the members of the
Company's Board of Directors and/or the Company as defendants.
On April 3, 2012, a verified shareholder class action lawsuit was
filed by Phillip Meeks in the Court of Chancery of the State of
Delaware against the Company and members of its Board of
Directors, alleging that, inter alia, the Company's Board of
Directors breached their fiduciary duties in connection with the
Proposed Buyout, and that the price per share proposed by Mr. Zhu
represented inadequate consideration in light of the Company's
intrinsic value and future prospects, and that the Company aided
and abetted the breach of fiduciary duties. The plaintiff seeks
damages, declaratory relief and injunctive relief, including an
order preventing the Company from proceeding with the Proposed
Buyout or any transaction with Mr. Zhu, as well as an award of
plaintiffs' attorneys' fees and costs. The Company believes that
none of the defendants has yet responded to the complaint.
On April 11, 2012, a verified shareholder class action lawsuit was
filed by Richard Bauschard in the Court of Chancery of the State
of Delaware against members of the Company's Board of Directors,
alleging that, inter alia, the Board of Directors breached their
fiduciary duties in connection with the Proposed Buyout, and that
the price per share proposed by Mr. Zhu represented inadequate
consideration in light of the Company's intrinsic value and future
prospects. The plaintiff seeks damages, declaratory relief and
injunctive relief, including an order preventing the defendants
from proceeding with the Proposed Buyout or any transaction with
Mr. Zhu, as well as an award of plaintiffs' attorneys' fees and
costs. The Company believes that none of the defendants has yet
responded to the complaint.
On April 18, 2012, a verified shareholder class action lawsuit was
filed by Harry Vonderlieth in the Court of Chancery of the State
of Delaware against the Company and members of its Board of
Directors, alleging that, inter alia, the Company's Board of
Directors breached their fiduciary duties to the shareholders in
connection with the Proposed Buyout, and that the price per share
proposed by Mr. Zhu represented inadequate consideration in light
of the Company's intrinsic value and future prospects, and that
the Company aided and abetted the breach of fiduciary duties. The
plaintiff seeks damages, declaratory relief and injunctive relief,
including an order preventing the Company from proceeding with the
Proposed Buyout or any transaction with Mr. Zhu, as well as an
award of plaintiffs' attorneys' fees and costs. The Company
believes that none of the defendants has yet responded to the
complaint.
The Company says it intends to defend against the pending class
action litigation vigorously.
ZYNGA INC: Removes "Reyes" Securities Suit to N.D. California
-------------------------------------------------------------
Robert Reyes, Individually and on Behalf of All Others Similarly
Situated v. Zynga Inc., Mark Pincus, David M. Wehner, Mark
Vranesh, William Gordon, Reid Hoffman, Jeffrey Katzenberg, Stanley
J. Meresmen, Suni Paul, John Schappert, Owen Van Natta, Goldman
Sachs & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Barclays Capital Inc., Morgan Stanley & Co. LLC, J.P. Morgan
Securities LLC, Allen & Company LLC and Does 1-25, inclusive, Case
No. CGC-12-522876 (Calif. Super. Ct., San Francisco Cty., August
1, 2012) is brought on behalf of all persons or entities who
acquired the common stock of Zynga pursuant and traceable to the
Company's alleged false and misleading Registration Statement and
Prospectus issued in connection with its March 28, 2012 secondary
offering of Class A common stock to the public.
Though the Company purported to warn of its dependence on Facebook
and that Facebook could change its gaming platform making it more
difficult for Zynga users to access and play its games, the
Company failed to disclose that such changes to the Facebook
platform had already begun to occur, thus, negatively impacting
the Company's current and future bookings, and its revenue and
earnings prospects, Mr. Reyes alleges.
Mr. Reyes is a shareholder of Zynga.
Zynga is a provider of online networking games. Zynga is a
Delaware corporation headquartered in San Francisco, California.
The Individual Defendants are directors and officers of the
Company. Goldman Sachs is a financial holding company that
provides global banking, securities, underwriting and investment
management services in the United States and internationally.
Goldman Sachs also provides debt and equity underwriting, mergers
and acquisitions and corporate restructuring advisory services,
securities dealing and brokerage, and trade execution services for
large-market companies and institutional investors. Merrill Lynch
provides securities, brokerage and dealership services as well as
investment advisory services. Barclays is the investment banking
arm of Barclays Bank plc. The investment bank, often referred to
as BarCap, was created in 1997 to provide strategic advisory,
financing, and risk management services to corporate, government,
and institutional clients around the world.
Morgan Stanley is a financial holding company that provides
various financial products and services to corporations,
governments, financial institutions, and individuals worldwide.
J.P. Morgan, a financial holding company, provides various
financial services worldwide. JP Morgan's investment bank segment
offers various investment banking products and services, including
advising on corporate strategy and structure, capital-raising in
equity and debt markets, risk management, market-making in cash
securities and derivative instruments, prime brokerage, and
research services for corporations, financial institutions,
governments, and institutional investors. Allen is an investment
banking firm that provides private placement, underwriting and
brokerage services to entertainment and media companies. Goldman
Sachs, Merrill, Barclays, Morgan Stanley, JP Morgan and Allen
served as underwriters for the Company's Offering.
Zynga removed the lawsuit on September 28, 2012, from the Superior
Court of the state of California, County of San Francisco, to the
United States District Court for the Northern District of
California. The Company argues that the removal is proper because
federal courts have exclusive jurisdiction over class actions that
assert claims under the Securities Act. The District Court Clerk
assigned Case No. 3:12-cv-05065 to the proceeding.
The Plaintiff is represented by:
Francis A. Bottini, Esq.
Keith M. Cochran, Esq.
CHAPIN FITZGERALD SULLIVAN & BOTTINI LLP
550 West C Street, Suite 2000
San Diego, CA 92101
Telephone: (619) 241-4810
Facsimile: (619) 955-5318
E-mail: fbottini@cfblawfirm.com
kcochran@cfblawfirm.com
The Defendants are represented by:
Jordan Eth, Esq.
Anna Erickson White, Esq.
Philip T. Besirof, Esq.
Mark R.S. Foster, Esq.
MORRISON & FOERSTER LLP
425 Market Street
San Francisco, CA 94105-2482
Telephone: (415) 268-7000
Facsimile: (415) 268-7522
E-mail: JEth@mofo.com
AWhite@mofo.com
PBesirof@mofo.com
MFoster@mofo.com
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Julie Anne L. Toledo, Christopher Patalinghug, Frauline Abangan
and Peter A. Chapman, Editors.
Copyright 2012. All rights reserved. ISSN 1525-2272.
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