/raid1/www/Hosts/bankrupt/CAR_Public/121106.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, November 6, 2012, Vol. 14, No. 220
Headlines
ABBOTT LABORATORIES: Can Remove 10 Ill. Depakote Cases to Fed. Ct.
APOLLO GROUP: Awaits Nov. 5 Hearing Results in "Adoma" Suit
APOLLO GROUP: $145MM in Policemen Class Deal Paid Out in 3rd Qtr.
APOLLO GROUP: Investors Group Appeal Dismissal of Securities Suit
APOLLO GROUP: Appeal From Dismissal of "Teamsters" Suit Pending
ATICO INT'L: Recalls 3,000 Halloween Mini Projection Lights
BAIN CAPITAL: Samsonite Laid-Off Workers File Class Action
BOEING CO: Briefing in Securities Suit Appeal to End in Jan.
BOEING CO: Continues to Defend ERISA-Violation Suits in Kansas
BOEING CO: Summary Judgment Bids in Ill. Suit Denied in Sept.
BOSE CORP: Recalls 20.5T CineMate II Home Theater Speaker Systems
CALIFORNIA: El Dorado County Joins HJTA Fire Fee Class Action
CANADA: Disabled War Veterans Sue Over Compensation Limits
ELI LILLY: Faces Class Action in California Over Cymbalta
EXCEL INDUSTRIES: Recalls 18,000 Hustler and BigDog Lawn Mowers
FACEBOOK INC: IPO-Related Cases Consolidated in New York Ct.
FACEBOOK INC: Defends Class Suits Filed by Users and Advertisers
FANNIE MAE: Judge Refuses to Dismiss ERISA Class Action
GOLDMAN SACHS: Seeks Review of 2nd Circuit Ruling on MBS Suits
HIGHLAND PARK: Class Action Hearing to Continue on December 5
INTERNATIONAL UNION: Members File RICO Class Action
JOHNSON & JOHNSON: Judge Approves $10-Mil. Attorneys' Fees
LUMBER LIQUIDATORS: Faces "Prusak" Class Suit in Illinois
MANNKIND CORP: Nov. 19 Hearing Set for Derivative Action Deal
NEWS CORP: Bid to Dismiss 3rd Amended Consolidated Suit Pending
NEWS CORP: "Forsta Ap-Fonden" Class Suit Pending in Delaware
NEWS CORP: Still Defends "Wilder" Securities Suit in New York
NEWS CORP: Consumer Suit vs. HarperCollins Still Pending in N.Y.
NEWS CORP: Consumer Suits vs. HarperCollins Pending in Canada
NEWS CORP: Appeals From Intermix Suit Settlement Dismissed
PERDUE FOODS: Recalls 1,440 Lbs. of Chicken Breast Nuggets
PIEDMONT OFFICE: Negotiates Tentative Deals in 2 Securities Suits
PORSCHE: HID Headlights Class Actions Obtains Certification
SPRINT NEXTEL: Being Sold to Softbank for Too Little, Suit Says
SOUTH CAROLINA: Revenue Dept. Faces Class Action Over Hacking
THOMAS JEFFERSON: Ex-Career Dean Admits to Padding Job Stats
WELLS FARGO: 11th Cir. Rejects Arbitration Bid in Overdraft Suit
*********
ABBOTT LABORATORIES: Can Remove 10 Ill. Depakote Cases to Fed. Ct.
------------------------------------------------------------------
The Seventh Circuit has ruled that Abbott Laboratories can remove
to federal court 10 cases filed in Illinois state court over its
anti-seizure drug Depakote. The court held that, although each of
the Depakote cases included fewer than 100 plaintiffs, they should
still be removed under the Class Action Fairness Act because
plaintiffs lawyers tried to coordinate them for trial.
APOLLO GROUP: Awaits Nov. 5 Hearing Results in "Adoma" Suit
-----------------------------------------------------------
Apollo Group, Inc., is awaiting results of a November 5, 2012
hearing to consider final approval of a settlement resolving a
wage and hour class action filed by Diane Adoma, according to the
Company's October 22, 2012, Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
August 31, 2012.
On January 8, 2010, Diane Adoma filed an action in United States
District Court, Eastern District of California alleging wage and
hour claims under the Fair Labor Standards Act and California law
for failure to pay overtime and other violations, entitled Adoma
et al. v. University of Phoenix, et al, Case Number 2:10-cv-00059-
LKK. On March 4, 2010, the Company filed a motion to dismiss, or
in the alternative to stay or transfer, the case based on the
previously filed Sabol and Juric actions. On May 3, 2010, the
Court denied the motion to dismiss and/or transfer. On April 12,
2010, plaintiff filed her motion for conditional collective action
certification. The Court denied class certification under the
Fair Labor Standards Act and transferred these claims to the
District Court in Pennsylvania. On August 31, 2010, the U.S.
District Court in California granted plaintiff's motion for class
action certification of the California claims. On September 14,
2010, the Company filed a petition for permission to appeal the
class certification order with the Ninth Circuit, which was denied
on November 3, 2010. There are approximately 1,500 current and
former employees in the class.
In August 2011, the parties agreed to settle the case for an
immaterial amount, which was accrued in the Company's financial
statements during fiscal year 2011. The agreement, in which the
Company does not admit any liability, is subject to final approval
by the Court. On June 18, 2012, the Court preliminarily approved
the settlement and granted the parties' motion to certify the
class of plaintiffs for settlement purposes, and the Final
Approval hearing is scheduled for November 5, 2012.
Apollo Group, Inc. is a large private education provider and has
been an educational provider for approximately 40 years. It
offers innovative and distinctive educational programs and
services both online and on-campus at the undergraduate, master's
and doctoral levels principally through the following wholly-owned
educational subsidiaries: The University of Phoenix, Inc.;
Institute for Professional Development ("IPD"); and The College
for Financial Planning Institutes Corporation ("CFFP").
APOLLO GROUP: $145MM in Policemen Class Deal Paid Out in 3rd Qtr.
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The $145 million settlement amount Apollo Group, Inc. negotiated
in a securities class action with plaintiff Policeman's Annuity
and Benefit Fund of Chicago was paid out in the third quarter of
the 2012 fiscal year, the Company disclosed in its October 22,
2012, Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended August 31, 2012.
In January 2008, a jury returned an adverse verdict against the
Company and two remaining individual co-defendants in a securities
class action lawsuit entitled, In re Apollo Group, Inc. Securities
Litigation, Case No. CV04-2147-PHX-JAT, filed in the U.S. District
Court for the District of Arizona, relating to alleged false and
misleading statements in connection with the Company's failure to
publicly disclose the contents of a preliminary U.S. Department of
Education program review report. After various post-trial
challenges, the case was returned to the trial court in March 2011
to administer the shareholder claims process. In September 2011,
the Company entered into an agreement in principle with the
plaintiffs to settle the litigation for $145.0 million, which was
preliminarily approved by the Court on November 28, 2011. On
April 20, 2012, the Court approved the settlement agreement and
entered an order of final judgment and dismissal. In connection
with approval of the settlement agreement and the dismissal of the
lawsuit, the Court also vacated the related judgment against the
Company and the individual defendants. Under the settlement
agreement and during the third quarter of fiscal year 2012, the
$145.0 million the Company had previously deposited into a common
fund account in December 2011 was paid to the plaintiffs.
As of August 31, 2012, the Company has accrued an estimate of a
portion of the $23.2 million of defense costs that were advanced
to it and other defendants in this shareholder litigation, and
estimated future legal costs that may be incurred in resolving the
dispute with the Company's insurers regarding whether the Company
is required to reimburse these funds. Because of the many
questions of fact and law that may arise, the outcome of the
dispute with the Company's insurance carriers is uncertain at this
point. However, the Company does not believe the potential
exposure in excess of its accrual is material.
Apollo Group, Inc. is a large private education provider and has
been an educational provider for approximately 40 years. It
offers innovative and distinctive educational programs and
services both online and on-campus at the undergraduate, master's
and doctoral levels principally through the following wholly-owned
educational subsidiaries: The University of Phoenix, Inc.;
Institute for Professional Development ("IPD"); and The College
for Financial Planning Institutes Corporation ("CFFP").
APOLLO GROUP: Investors Group Appeal Dismissal of Securities Suit
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An appeal has been lodged challenging a trial court's dismissal of
a securities class action complaint against Apollo Group, Inc. by
plaintiff Apollo Institutional Investors Group, according to
Apollo Group's October 22, 2012, Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
August 31, 2012.
On August 13, 2010, a securities class action complaint was filed
in the U.S. District Court for the District of Arizona by Douglas
N. Gaer naming the Company, John G. Sperling, Gregory W. Cappelli,
Charles B. Edelstein, Joseph L. D'Amico, Brian L. Swartz and
Gregory J. Iverson as defendants for allegedly making false and
misleading statements regarding the Company's business practices
and prospects for growth. That complaint asserted a putative
class period stemming from December 7, 2009 to August 3, 2010. A
substantially similar complaint was also filed in the same Court
by John T. Fitch on September 23, 2010 making similar allegations
against the same defendants for the same purported class period.
Finally, on October 4, 2010, another purported securities class
action complaint was filed in the same Court by Robert Roth
against the same defendants as well as Brian Mueller, Terri C.
Bishop and Peter V. Sperling based upon the same general set of
allegations, but with a defined class period of February 12, 2007
to August 3, 2010. The complaints allege violations of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder. On October 15, 2010, three
additional parties filed motions to consolidate the related
actions and be appointed the lead plaintiff.
On November 23, 2010, the Fitch and Roth actions were consolidated
with Gaer and the Court appointed the "Apollo Institutional
Investors Group" consisting of the Oregon Public Employees
Retirement Fund, the Mineworkers' Pension Scheme, and Amalgamated
Bank as lead plaintiffs. The case is now entitled, In re Apollo
Group, Inc. Securities Litigation, Lead Case Number CV-10-1735-
PHX-JAT.
On February 18, 2011, the lead plaintiffs filed a consolidated
complaint naming Apollo, John G. Sperling, Peter V. Sperling,
Joseph L. D'Amico, Gregory W. Cappelli, Charles B. Edelstein,
Brian L. Swartz, Brian E. Mueller, Gregory J. Iverson, and William
J. Pepicello as defendants. The consolidated complaint asserts a
putative class period of May 21, 2007 to October 13, 2010. On
April 19, 2011, the Company filed a motion to dismiss and oral
argument on the motion was held before the Court on October 17,
2011. On October 27, 2011, the Court granted the Company's motion
to dismiss and granted plaintiffs leave to amend. On December 6,
2011, the lead plaintiffs filed an Amended Consolidated Class
Action Complaint, which alleges similar claims against the same
defendants. On January 9, 2012, the Company filed a motion to
dismiss the Amended Consolidated Class Action Complaint. On June
22, 2012, the Court granted the Company's motion to dismiss and
entered a judgment in its favor.
On July 20, 2012, the plaintiffs filed a Notice of Appeal with the
U.S. Court of Appeals for the Ninth Circuit, and their appeal
remains pending before that Court.
If the plaintiffs are successful in their appeal, the Company
anticipates it will seek substantial damages. Because of the many
questions of fact and law that may arise, the outcome of this
legal proceeding is uncertain at this point, says the Company.
Based on information available to it at present, the Company
cannot reasonably estimate a range of loss for this action and,
accordingly, it has not accrued any liability associated with this
action.
Apollo Group, Inc. is a large private education provider and has
been an educational provider for approximately 40 years. It
offers innovative and distinctive educational programs and
services both online and on-campus at the undergraduate, master's
and doctoral levels principally through the following wholly-owned
educational subsidiaries: The University of Phoenix, Inc.;
Institute for Professional Development ("IPD"); and The College
for Financial Planning Institutes Corporation ("CFFP").
APOLLO GROUP: Appeal From Dismissal of "Teamsters" Suit Pending
---------------------------------------------------------------
An appeal from the dismissal of Teamsters' class action lawsuit
remains pending, according to Apollo Group, Inc.'s October 22,
2012, Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended August 31, 2012.
On November 2, 2006, the Teamsters Local 617 Pension and Welfare
Funds filed a class action complaint purporting to represent a
class of shareholders who purchased the Company's stock between
November 28, 2001 and October 18, 2006. The complaint, filed in
the U.S. District Court for the District of Arizona, is entitled
Teamsters Local 617 Pension & Welfare Funds v. Apollo Group, Inc.
et al., Case Number 06-cv-02674-RCB, and alleges that the Company
and certain of its current and former directors and officers
violated Sections 10(b) and 20(a) of the Securities Exchange Act
of 1934 and Rule 10b-5 promulgated thereunder by purportedly
making misrepresentations concerning the Company's stock option
granting policies and practices and related accounting. The
defendants are Apollo Group, Inc., J. Jorge Klor de Alva, Daniel
E. Bachus, John M. Blair, Dino J. DeConcini, Kenda B. Gonzales,
Hedy F. Govenar, Brian E. Mueller, Todd S. Nelson, Laura Palmer
Noone, John R. Norton III, John G. Sperling and Peter V. Sperling.
On September 11, 2007, the Court appointed The Pension Trust Fund
for Operating Engineers as lead plaintiff. Lead plaintiff filed
an amended complaint on November 23, 2007, asserting the same
legal claims as the original complaint and adding claims for
violations of Section 20A of the Securities Exchange Act of 1934
and allegations of breach of fiduciary duties and civil
conspiracy. On April 30, 2009, plaintiffs filed their Second
Amended Complaint, which alleges similar claims for alleged
securities fraud against the same defendants.
On March 31, 2011, the U.S. District Court for the District of
Arizona dismissed the case with prejudice and entered judgment in
the Company's favor. Plaintiffs filed a motion for
reconsideration of this ruling, and the Court denied this motion
on April 2, 2012. On April 27, 2012, the plaintiffs filed a
Notice of Appeal with the U.S. Court of Appeals for the Ninth
Circuit, and their appeal remains pending before that Court.
No further updates were reported in the Company's latest Form 10-K
filing.
If the plaintiffs are successful in their appeal, the Company
anticipates anticipate it will seek substantial damages. Because
of the many questions of fact and law that may arise, the outcome
of this legal proceeding is uncertain at this point, says the
Company. Based on information available to it at present, the
Company cannot reasonably estimate a range of loss for this action
and, accordingly, it has not accrued any liability associated with
this action.
Apollo Group, Inc. is a large private education provider and has
been an educational provider for approximately 40 years. It
offers innovative and distinctive educational programs and
services both online and on-campus at the undergraduate, master's
and doctoral levels principally through the following wholly-owned
educational subsidiaries: The University of Phoenix, Inc.;
Institute for Professional Development ("IPD"); and The College
for Financial Planning Institutes Corporation ("CFFP").
ATICO INT'L: Recalls 3,000 Halloween Mini Projection Lights
-----------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Atico International USA Inc., of Fort Lauderdale, Florida,
announced a voluntary recall of about 3,000 Halloween Mini
Projection Lights. Consumers should stop using recalled products
immediately unless otherwise instructed. It is illegal to resell
or attempt to resell a recalled consumer product.
The mini projection lights can overheat and melt, posing a burn
hazard to consumers.
Atico International USA has received two reports of incidents,
including one minor burn injury.
This recall involves plastic Halloween mini projection lights.
They are about 6 inches long and have Halloween-themed black
designs on them. They were sold in orange, green and purple. The
projection lights came in a cardboard blister pack with a purple
background. The phrase "Ghouloween" is printed on the upper left-
hand corner. Pictures of the recalled products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml13/13025.html
The recalled products were manufactured in China and sold
exclusively at Five Below stores nationwide during September 2012
for $1.25.
Consumers should immediately stop using the recalled mini
projection lights and contact Atico International to receive a
full refund. Atico International USA; toll-free at (888) 253-
6342, from 9:00 a.m. to 5:00 p.m. Eastern Time Monday through
Friday, or http://www.aticousa.com/recalls.html/for more
information.
BAIN CAPITAL: Samsonite Laid-Off Workers File Class Action
----------------------------------------------------------
Kevin Koeninger at Courthouse News Service reports that Bain
Capital had a third party bankrupt a Samsonite factory in France
to duck more than $75 million in legally required training and
relocation fees to the 200 worker who lost their jobs, a class
action claims in Federal Court.
Bain and its associates walked away with $1.6 billion, while the
laid-off workers got nothing, according to the complaint.
Lead plaintiff Murielle Abdallah sued Bain Capital LLC in Federal
Court. She claims Bain's scheme was not revealed until 2011,
after a criminal case against the third-party businessman in
France.
Bain, founded by presidential candidate Mitt Romney, is the only
defendant in the complaint. Neither Mr. Romney nor Samsonite are
defendants.
Ms. Abdallah says she worked at Samsonite's Henin-Beaumont
Factory.
"In 2003, Bain Capital LLC (hereafter 'Bain') was the main and
active participant of an investors' pool, also consisting of Ares
Management and Ontario Teacher Pension Funds," the complaint
states. "The pool purchased approximately eighty-five percent
(85%) of Samsonite's outstanding shares, through a
recapitalization agreement for a total price of a hundred and six
million dollars ($106,000,000). The market price of one share
was, then, once cent ($0.01).
"As recently discovered, (infra Sec. 74), Bain decided to
fraudulently externalize the shut down of the Henin-Beaumont
Factory as early as December 2003, in order to avoid having its
newly acquired company, Samsonite closing down the Factory itself
for a hundred million dollars ($100,000,000)."
The class claims: "The provisions of the French Labor Code
requires any individual or entity employing a minimum of fifty
(50) workers and seeking to terminate the employment of a minimum
of ten (10) workers to implement a collective redundancy plan.
"The aim of such plan is to mitigate the consequences to the
workers of the economic difficulties faced by the employer, and
promotes reassignment of the workers to different positions within
the company or, failing that, retraining."
It adds: "For an American group similar to Samsonite in size and
results, the cost of a collective redundancy plan to dismiss some
two hundred (200) employees of a French subsidiary would be in the
region of seventy-five to a hundred twenty million dollars
($75,000,000 - $120,000,000). Such figure would need to be
provided, and entered in the consolidated accounting books of the
company as a liability."
To duck that liability and maximize its profits from the eventual
sale of Samsonite, Bain "decided . . . that Samsonite should
externalize fraudulently the shut down of the Henin-Beaumont
Factory rather than proceeding to the shut down itself," the
complaint states.
"The fraudulent scheme consisted in paying a third party to
purchase the Henin-Beaumont Factory and operate the factory
thereafter in such a way that it would result in the bankruptcy of
the factory. But for the fraudulent scheme, Samsonite would have
had to register a loss of approximately a hundred million dollars
($100,000,000) and Bain would not have been able to resale
Samsonite at a billion and seven hundred million dollars
($1,700,000,000)."
To implement the plan, "in 2005, despite skyrocketing profits,
Samsonite, as the mouthpiece for Bain, presented the
representatives of the Factory's employees with a takeover plan
promoted by HB Group, a shell company owned and operated by Jean-
Jacques Aurel ('Aurel'), a self-proclaimed entrepreneur from
Luxembourg. Mr. Aurel was brought to Samsonite by Bain who knew
that Aurel would agree to be paid to purchase the factory and lead
it to bankruptcy," according to the complaint.
"Indeed, Aurel had experience in implementing this kind of plan to
circumvent French law and deny employees proper compensation, as
he had already performed a similar takeover plan for a [sic]
Delsey, Samsonite's main competitor, using a different shell
company. The fraudulent operation in the Delsey case resulted in
the liquidation of the factory, and the dismissal of over two
hundred (200) employees (for which Delsey has since been found
liable)."
Mr. Aurel shifted the factory toward production of solar panels
after renaming it NewCo, but "within one month following the sale,
NewCo lost two hundred thousand Euros (200,000)," the complaint
states. "One year after the sale, NewCo filed for bankruptcy.
Eventually, in a decision dated February 15, 2007 the Tribunal de
Commerce of Paris, ordered the judicial liquidation of the
factory. Not one solar panel had been produced by the factory."
Ms. Abdallah says she got nothing after being laid off from the
factory.
But "in the summer of 2007, Bain and the other shareholders sold
Samsonite to CVC Capital Partners, for around one billion seven
hundred million dollars ($1,700,000,000), including the assumption
of debt. The market price of a share was at that point one dollar
and forty-nine cents ($1.49).
"Bain and its affiliates have therefore realized a profit of about
one billion six hundred million dollars ($1,600,000,000)."
The class claims Bain's role in the takeover was kept secret until
2011, when Mr. Aurel, "who had been sentenced to 3-year
imprisonments by the Criminal Court, for his participation in the
fraudulent scheme, and whose appeal was pending, revealed to
plaintiff the role Bain had played in the design and execution of
the scheme.
"In an affidavit delivered to plaintiff, Aurel indicated that Bain
attended to every important meeting between Samsonite and Aurel to
negotiate the takeover."
Ms. Abdallah seeks class damages of more than $15 million for
tortious interference with employee contracts, fraud, negligent
misrepresentation and unjust enrichment.
She is represented by Philippe Jean Joseph Pradal of New York
City, and Timothy Cutler in Boston.
BOEING CO: Briefing in Securities Suit Appeal to End in Jan.
------------------------------------------------------------
Briefing before the U.S. Court of Appeals for the Seventh Circuit
of an appeal over the dismissal of a putative securities fraud
class action against The Boeing Company is scheduled to be
completed by early January 2013, according to The Boeing Company's
October 24, 2012, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended September 30, 2012.
On November 13, 2009, plaintiff shareholders filed a putative
securities fraud class action against The Boeing Company and two
of its senior executives in federal district court in Chicago.
This lawsuit arose from the Company's June 2009 announcement that
the first flight of the 787 Dreamliner would be postponed due to a
need to reinforce an area within the side-of-body section of the
aircraft. Plaintiffs contended that the Company was aware before
June 2009 that the first flight could not take place as scheduled
due to issues with the side-of-body section of the aircraft, and
that the Company's determination not to announce this delay
earlier resulted in an artificial inflation of the Company's stock
price for a multi-week period in May and June 2009. On March 7,
2011, the Court dismissed the complaint with prejudice.
On March 19, 2012, the Court denied the plaintiffs' request to
reconsider that order. On April 12, 2012, plaintiffs filed a
Notice of Appeal, and on April 25, 2012, Boeing filed a Notice of
Cross-Appeal based on the district court's failure to award
sanctions against the plaintiffs. Briefing before the Seventh
Circuit Court of Appeals is scheduled to be completed by early
January 2013.
In addition, plaintiff shareholders have filed three similar
shareholder derivative lawsuits concerning the flight schedule for
the 787 Dreamliner that closely track the allegations in the
putative class action lawsuit. Two of the lawsuits were filed in
Illinois state court and have been consolidated. The remaining
derivative lawsuit was filed in federal district court in Chicago.
Following the March 2012 decision confirming the dismissal of the
class action complaint, the plaintiffs in these derivative
lawsuits agreed to voluntarily dismiss their lawsuits without
prejudice. Plaintiff in the federal case filed a Notice of
Voluntary Dismissal on June 26, 2012, and the court dismissed the
case on June 28, 2012. Plaintiffs in the consolidated state case
filed a Notice of Voluntary Dismissal on July 3, 2012, and the
court dismissed the case on August 24, 2012.
BOEING CO: Continues to Defend ERISA-Violation Suits in Kansas
--------------------------------------------------------------
The Boeing Company continues to defend two class action lawsuits
in Kansas, according to the Company's October 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended September 30, 2012.
The Company has been named as a defendant in two pending class
action lawsuits filed in the U.S. District Court for the District
of Kansas, each related to the 2005 sale of the Company's former
Wichita facility to Spirit AeroSystems, Inc. (Spirit). The first
action involves allegations that Spirit's hiring decisions
following the sale were tainted by age discrimination, violated
the Employee Retirement Income Security Act of 1974 ("ERISA"),
violated the Company's collective bargaining agreements, and
constituted retaliation. The case was brought in 2006 as a class
action on behalf of individuals not hired by Spirit. The court
granted summary judgment in 2010 in favor of Boeing and Spirit on
all class action claims, and during the third quarter of 2012 the
Tenth Circuit Court of Appeals affirmed the summary judgment. No
further proceedings are scheduled at this time, but individual
claimants may elect to pursue their respective claims of age
discrimination.
The second action, initiated in 2007, alleges collective
bargaining agreement breaches and ERISA violations in connection
with alleged failures to provide benefits to certain former
employees of the Wichita facility. Written discovery closed by
joint stipulation of the parties on June 6, 2011. Depositions
concluded on August 18, 2011. Plaintiffs' partial motion for
summary judgment was filed on December 9, 2011. Boeing's
opposition and dispositive motions were filed on February 10,
2012. All briefing was completed on June 4, 2012. Spirit has
agreed to indemnify Boeing for any and all losses in the first
action, with the exception of claims arising from employment
actions prior to January 1, 2005.
While Spirit has acknowledged a limited indemnification obligation
in the second action, the Company believes that Spirit is
obligated to indemnify Boeing for any and all losses in the second
action. The Company cannot reasonably estimate the range of loss,
if any, that may result from this matter given the current
procedural status of the litigation.
BOEING CO: Summary Judgment Bids in Ill. Suit Denied in Sept.
-------------------------------------------------------------
The Boeing Company's motions for summary judgment in the class
action lawsuit pending in Illinois were denied in September,
according to the Company's October 24, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
September 30, 2012.
On October 13, 2006, the Company was named as a defendant in a
lawsuit filed in the U.S. District Court for the Southern District
of Illinois. Plaintiffs, seeking to represent a class of
similarly situated participants and beneficiaries in The Boeing
Company Voluntary Investment Plan (the VIP), alleged that fees and
expenses incurred by the VIP were and are unreasonable and
excessive, not incurred solely for the benefit of the VIP and its
participants, and were undisclosed to participants. The
plaintiffs further alleged that defendants breached their
fiduciary duties in violation of Section 502(a)(2) of the Employee
Retirement Income Security Act of 1974 ("ERISA"), and sought
injunctive and equitable relief pursuant to Section 502(a)(3) of
ERISA. During the first quarter of 2010, the Seventh Circuit
Court of Appeals granted a stay of trial proceedings in the
district court pending resolution of an appeal made by Boeing in
2008 to the case's class certification order. On January 21,
2011, the Seventh Circuit reversed the district court's class
certification order and decertified the class. The Seventh
Circuit remanded the case to the district court for further
proceedings. On March 2, 2011, plaintiffs filed an amended motion
for class certification and a supplemental motion on August 7,
2011. Boeing's opposition to class certification was filed on
September 6, 2011. Plaintiffs' reply brief in support of class
certification was filed on September 27, 2011. The court has
stated its intent to issue rulings on the amended motion for class
certification and the alternative motion to proceed as a direct
action for breach of fiduciary duty and then stay the case until
it is determined if an appeal of the class certification order is
filed.
As a result, on September 19, 2012, the district court issued an
order denying Boeing's motions for summary judgment as premature
pending class determination.
The Company says it cannot reasonably estimate the range of loss,
if any, that may result from this matter given the current
procedural status of the litigation.
BOSE CORP: Recalls 20.5T CineMate II Home Theater Speaker Systems
-----------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Bose Corporation, of Framingham, Massachusetts, announced a
voluntary recall of about 20,500 Dual-Voltage CineMate II Home
Theater Speaker Systems. Consumers should stop using recalled
products immediately unless otherwise instructed. It is illegal
to resell or attempt to resell a recalled consumer product.
A component in the bass module can fail when used outside of the
U.S. in electrical outlets rated at 220 volts or higher,
presenting a fire hazard to consumers.
Bose has received two reports of the bass modules igniting when
used in 220-volt electrical outlets in Europe. No injuries were
reported.
This recall involves dual-voltage CineMate Series II and CineMate
GS Series II digital home theater speaker systems designed to
operate with U.S. 120-volt electrical outlets and European outlets
of 220 volts or higher. Each speaker system includes two
speakers, one bass module, a remote control device, an interface
module and accessories. The components are black. Dual-voltage
systems included in the recall have a product code of 051365,
051470 or 057971, which are the first six digits of the serial
number on the product label located on the back of the bass
module. Pictures of the recalled products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml13/13022.html
The recalled products were manufactured in Mexico and sold at U.S.
Military Exchanges and select U.S. retailers from September 2009
through September 2012 for between $600 and $800.
Consumers should immediately stop using and unplug any dual-
voltage CineMate II systems and contact Bose to arrange for a free
repair or replacement of the bass module. Bose Corporation; toll-
free (877) 354-1004, 8:30 a.m. to 9:00 p.m. Monday through Friday
Eastern Time in the U.S. or 001 (508) 614-1842, 8:30 a.m. to 5:00
p.m. Eastern Time Monday through Friday outside the U.S., or
http://www.bose.com/safety/for more information.
CALIFORNIA: El Dorado County Joins HJTA Fire Fee Class Action
-------------------------------------------------------------
Tahoe Daily Tribune reports that the El Dorado County Board of
Supervisors voted unanimously to join the Howard Jarvis Taxpayers
Association class action lawsuit seeking to overturn the state
fire fee.
El Dorado County residents living in the "state responsibility
area" began receiving fire fee bills in late September. The fee
is $150 per habitable structure within the state responsibility
area. A $35 dollar discount applies if the structure is also
within the boundaries of a local fire protection district.
The county government received bills for five pieces of property
including sites purchased for road right of way, the Perks Court
homeless facility, residential property adjacent to the Headington
Road corporation yard, and the Union Mine disposal site. The
county filed a Petition for Redetermination, and submitted a
letters to state officials indicating the county's payment of the
fee was provided under protest.
The county's letter argues that the fire fee is actually a tax
which requires a two-thirds vote of the Legislature. The bill
imposing the fire fee garnered only a simple majority of votes.
"For this reason," the letter states, "the County of El Dorado
pays the Fire Prevention Fee under protest and reserves all rights
to pursue a refund of said amount through judicial action or
otherwise."
It is expected that the HJTA complaint against the fee will be
amended in the coming weeks to add additional plaintiffs,
including El Dorado County.
Information about the lawsuit is available at
http://www.firetaxprotest.org
For more information about the fee, including a list of
recommended actions regarding payment is available on the county's
Web site at http://www.edcgov.us
CANADA: Disabled War Veterans Sue Over Compensation Limits
----------------------------------------------------------
Darryl Greer at Courthouse News Service reports that disabled war
veterans claim in a class action that Canada unfairly compensates
them for combat and non-combat related injuries and pain and
suffering.
Lead plaintiff Daniel Christopher Scott claims in British Columbia
Supreme Court that Canada's "New Veterans Charter" of 2005 limits
compensation for injuries during service, paying out lump sums
that pale in comparison to payments under provincial workers'
compensation schemes.
"A severely disabled worker under current provincial workers'
compensation programs would be compensated with approximately $2.0
million dollars in tax-free income benefits from their twenties to
age 65," the complaint states.
"Members of the Class with the same disabilities receive
substantially reduced benefits under the New Veterans Charter."
According to the complaint: "The New Veterans Charter was the most
significant change in how veterans were to be compensated for
their injuries in more than 90 years, but the bill received less
than one minute of discussion in the House of Commons for second
and third readings."
Canadian courts, meanwhile, routinely award substantially more to
people injured in tort cases, but injured soldiers are left with
much less under the New Veterans Charter, according to the
complaint.
"Disabled members of the Class are left to derive annual income
from the investment of their lump sum payout despite their own
reduced ability to work and earn income," the complaint states.
"The plaintiffs say that their onetime payouts are, in addition to
the awards being less than those awarded by the courts,
disproportionately small because the method of settlement does not
factor future wage losses, loss of capacity, or future cost of
care."
The 53-page complaint describes the seven named plaintiffs'
histories, and the evolving role of Canada's military since World
War I.
Mr. Scott says he was injured in a training exercise after his
platoon suffered casualties from an improvised explosive device
during his second tour in Afghanistan.
During the exercise, Canadian soldiers improperly detonated a C19
mine while Scott and other soldiers were in the mine's destructive
path. He was hit by the mine's metal balls and his rib was
fractured and he suffered a collapsed lung, according to the
complaint.
He was awarded just over $41,000 for his injuries, an amount which
is "an inadequate reflection of his pain and suffering," the
complaint states.
Plaintiff Gavin Flett's leg was injured in Afghanistan when a tree
fell on him. He says he also suffers from post-traumatic stress
disorder. He was awarded $13,000 for his leg injury and $82,000
for his PTSD claim.
He now walks with a limp, his wife broke off their marriage and he
was evicted from his Canadian Forces housing unit when the army
terminated his full-time status, the complaint states. Mr. Flett
says he put himself through university without government help,
and he can no longer pursue a career in law enforcement, as he had
planned.
Mr. Campbell, who served in the Canadian Forces for more than 30
years, had his legs blown off by an IED while serving in
Afghanistan in 2008. He was also diagnosed with a traumatic brain
injury, major depression and PTSD. He was awarded $260,000 for
his injuries, which later was increased, but the increase didn't
matter since the charter caps compensation at $250,000, according
to the complaint. He also expects to receive just over $10,000 a
month in taxable monthly compensation.
"Mr. Campbell suffered a catastrophic injury that ended his
upwards career as a senior decorated Canadian Forces Member," the
complaint states. "He is incapable of earning a gainful income
and will most certainly suffer financial distress in the future as
family needs far exceed their reduced means."
Plaintiff Kevin Berry turned 20 a month before being deployed to
Afghanistan in 2003. Mr. Berry says he injured his knees
dismounting from a jeep while on patrol in the war-torn country.
"Mr. Berry was required to patrol the streets of Kabul in knee
braces carrying 15 kilograms of mission-critical equipment and
supplies, 30 kilograms of body armor, fighting order, 1,000 rounds
of ammunition, radios, and other equipment," the complaint states.
"As a result of Mr. Berry's duties, there was long-term damage
done to his knees including, but not limited to, patella-femoral
pain syndrome and osteoarthritis. In addition, Mr. Berry suffered
from tinnitus in his ears."
In 2009, he suffered panic attacks and flashbacks and began
abusing alcohol. He receives a modest pension and received lump
sum payments for PTSD totaling about $85,000, but he went into
debt while waiting for the payments due to "numerous delays"
processing the payments.
Bradley Quast was injured in an IED blast in Afghanistan in 2009.
The explosion killed four soldiers, journalist Michelle Lang, and
injured five others, including him. His right foot was injured
and he "could see bones sticking out of his skin" after removing
his boot. For his injuries, including PTSD, Mr. Quast received
three lump sum payments totaling more than $200,000.
Aaron Bedard suffered whiplash when the vehicle he was in
triggered an anti-tank mine. He suffered constant headaches but
served out the rest of his tour in Afghanistan, where he was
involved in two more explosions with his unit. Upon medical
release from the army, he returned home, began abusing alcohol and
contemplating suicide daily. He received $199,000 for his injuries
and receives $42,000 yearly for long-term disability.
"A veteran, whether regular or reserve, active or retired, is
someone who, at one point in their life, wrote a blank check made
payable to 'the Government of Canada,' for an amount of 'up to and
including their life,'" the complaint states. "This commitment to
make the ultimate sacrifice reflects their honor in the service of
their country.
"Potential recruits may well reconsider the choice of a physically
challenging and potentially hazardous military occupation if it
becomes evident to them that an injury or illness may result in
the termination of one's career without appropriate compensation
or provision for adequate training and preparation for a return to
civilian employment. Similarly, serving members are likely to me
much less eager to place themselves in harm's way if they perceive
that a resulting injury, disability, and release from the Canadian
Forces does not, with certainty, result in immediate treatment and
adequate compensation."
They seek equitable remedies, aggravated damages and costs.
The Plaintiffs are represented by:
Donald Sorochan, Esq.
MILLER THOMSON
Robson Court
1000-840 Howe Street
Vancouver, BC
V6Z 2M1
Telephone: (604) 687-2242
E-mail: dsorochan@millerthomson.com
ELI LILLY: Faces Class Action in California Over Cymbalta
---------------------------------------------------------
Keller Rohrback L.L.P., Keller Rohrback P.L.C., Pogust Braslow
Millrood LLC and Deskin Law Firm, a PLC filed a class action
lawsuit on Oct. 31 against Eli Lilly and Company. Lilly, an
Indiana based pharmaceutical company, is the maker of Cymbalta.
The class action complaint was filed in the United States District
Court for the Central District of California, in Los Angeles, on
behalf of all consumers who purchased Cymbalta at any time since
the product's launch in August 2004 to the present.
Cymbalta is prescribed to individuals that have been diagnosed
with generalized anxiety disorder, fibromyalgia, and
musculoskeletal pain. Plaintiff alleges that Lilly misrepresented
the risks associated with taking Cymbalta and misled consumers
about the frequency, severity, and duration of "Cymbalta
withdrawal." Withdrawal symptoms include, among others,
headaches, dizziness, nausea, fatigue, nightmares, insomnia,
anxiety, and suicidal ideation. Cymbalta withdrawal symptoms can
range from mild to severe - the latter consisting of debilitating
and painful symptoms that last several months.
If you used Cymbalta or you would like more information regarding
the Cymbalta class action, please contact one of the following
attorneys: Michael Woerner or Mark Samson, Keller Rohrback at 800-
776-6044 or via e-mail at consumer@kellerrohrback.com
If you used Cymbalta, suffered serious side effects, and want more
information about pursuing an individual personal injury claim,
please contact Pogust Braslow Millrood LLC and Deskin Law Firm, a
PLC via the contact form on the Web site:
http://cymbaltasideeffects.comor at 800-897-8930 or via e-mail at
cymbalta@deskinlawfirm.com
CONTACT: Keller Rohrback L.L.P.
Michael Woerner, Esq.
1201 Third Ave., Ste. 3200
Seattle, WA 98101
Keller Rohrback P.L.C.
Mark Samson, Attorney
3101 North Central Ave., Ste. 1400
Phoenix, AZ 85012
Telephone: 800-776-6044
E-mail: consumer@kellerrohrback.com
Web site: http://www.krcomplexlit.com
Pogust Braslow Millrood LLC
Harris Pogust, Esq.
8 Tower Bridge, Suite 1520
161 Washington Street
Conshohocken, PA 19428
Telephone: 888-348-6787
Web site: http://cymbaltasideeffects.com
Deskin Law Firm, a PLC
Samuel Deskin, Esq.
16944 Ventura Blvd., Office
Encino, CA 91316
Telephone: (800) 709-8978
E-mail: consumer@deskinlawfirm.com
Web site: http://cymbaltasideeffects.com
EXCEL INDUSTRIES: Recalls 18,000 Hustler and BigDog Lawn Mowers
---------------------------------------------------------------
About 18,000 Hustler and BigDog Lawn Mowers were voluntarily
recalled by Excel Industries Inc., of Hesston, Kansas, in
cooperation with the CPSC. Consumers should stop using the
product immediately unless otherwise instructed. It is illegal to
resell or attempt to resell a recalled consumer product.
The fuel tank vent valve fitting can fail to seal and cause a fuel
leak, posing a fire hazard. The firm is aware of 152 incidents of
vent valve fittings failing. No injuries or property damage have
been reported.
The Hustler and BigDog brand riding or walk-behind lawn mowers
were sold in the following colors: Hustler models in yellow;
BigDog models in red. They have large mowing decks ranging from
36 to 72 inches. Model name and serial numbers can be found on a
tag located on the left side of the frame in the front of the
mower's fender. The following model names, serial numbers and
types of lawn mower are included in this recall:
Brand: Hustler
--------------------------------------------------------------
Model Name Type Serial Numbers
---------- ---- --------------
1500 Riding Greens Riding 10062845 thru 11081604
FasTrak Zero Turn riding 10121082 thru 11120946
FasTrak Super Duty Zero Turn riding 10091717 thru 12054999
Sport Zero Turn riding 10120377 thru 12054999
Super Z Zero Turn riding 10109017 thru 12054999
TrimStar Walk-behind 11033546 thru 12054999
X-ONE Zero Turn riding 10090765 thru 12022041
Brand: BigDog
--------------------------------------------------------------
Model Name Type Serial Numbers
---------- ---- --------------
A Series Zero Turn riding 11100596 thru 12054999
C Series Zero Turn riding 11031908 thru 12054999
R Diablo Zero Turn riding 12020696 thru 12054999
R PowerBar Zero Turn riding 12020892 thru 12054999
R Series Zero Turn riding 11021137 thru 12054999
T Series Walk-behind 11050815 thru 12054999
X Series Zero Turn riding 11039001 thru 12054999
X Diablo Zero Turn riding 11090151 thru 12054999
Pictures of the recalled products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml13/13704.html
The recalled products were manufactured in the United States of
America and sold at Hustler and BigDog dealers nationwide from
September 2010 to May 2012 for between $2,900 and $21,000.
Consumers should immediately stop using the recalled lawn mowers
and contact a Hustler or BigDog dealer to schedule an appointment
for a free repair. Excel is contacting its customers directly.
Excel Industries; (800) 748-8223, 8:00 a.m. to 5:00 p.m. Central
Time Monday to Friday, or Web sites http://www.hustlerturf.com/
and http://www.bigdogmowers.com/and click on Product Recall
Information for more information.
FACEBOOK INC: IPO-Related Cases Consolidated in New York Ct.
------------------------------------------------------------
Facebook, Inc.'s motion to consolidate the vast majority of IPO-
related cases against the Company in the United States of America
was granted last month, according to the Company's October 24,
2012, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended September 30, 2012.
Beginning on May 22, 2012, multiple putative class actions,
derivative actions, and individual actions were filed in state and
federal courts in the United States and in other jurisdictions
against the Company, its directors, and/or certain of its officers
alleging violation of securities laws or breach of fiduciary
duties in connection with the Company's initial public offering
and seeking unspecified damages. The Company believes these
lawsuits are without merit, and it intends to continue to
vigorously defend them.
On October 4, 2012, on the Company's motion, the vast majority of
the cases in the United States, along with multiple cases filed
against The NASDAQ OMX Group, Inc. and The Nasdaq Stock Market LLC
(collectively referred to herein as NASDAQ) alleging technical and
other trading-related errors by NASDAQ in connection with the
Company's IPO, were ordered centralized for coordinated or
consolidated pre-trial proceedings in the United States District
Court for the Southern District of New York. In addition, the
events surrounding the Company's IPO have become the subject of
various government inquiries, and the Company is cooperating with
those inquiries. Any such inquiries could subject the Company to
substantial costs, divert resources and the attention of
management from the Company's business, and adversely affect its
business.
FACEBOOK INC: Defends Class Suits Filed by Users and Advertisers
----------------------------------------------------------------
Facebook, Inc., disclosed in its October 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended September 30, 2012, that it is a party to class
action lawsuits brought by users and advertisers.
The Company is involved in numerous class action lawsuits and
other litigation matters that are expensive and time consuming,
and, if resolved adversely, could harm its business, financial
condition, or results of operations.
In addition to intellectual property claims, the Company is also
involved in numerous other lawsuits, including putative class
action lawsuits brought by users and advertisers, many of which
claim statutory damages, and the Company anticipates that it will
continue to be a target for numerous lawsuits in the future.
Because the Company has over a billion users, the plaintiffs in
class action cases filed against it typically claim enormous
monetary damages even if the alleged per-user harm is small or
non-existent. Any negative outcome from such lawsuits could
result in payments of substantial monetary damages or fines, or
changes to the Company's products or business practices, and
accordingly the Company's business, financial condition, or
results of operations could be materially and adversely affected.
Although the results of such lawsuits and claims cannot be
predicted with certainty, the Company does not believe that the
final outcome of those matters relating to its products that it
currently faces will have a material adverse effect on its
business, financial condition, or results of operations. The
Company believes these lawsuits are without merit and is
vigorously defending these lawsuits.
There can be no assurances that a favorable final outcome will be
obtained in all the Company's cases, and defending any lawsuit is
costly and can impose a significant burden on management and
employees. Any litigation to which the Company is a party may
result in an onerous or unfavorable judgment that may not be
reversed upon appeal or in payments of substantial monetary
damages or fines, or the Company may decide to settle lawsuits on
similarly unfavorable terms, which could adversely affect its
business, financial conditions, or results of operations.
FANNIE MAE: Judge Refuses to Dismiss ERISA Class Action
-------------------------------------------------------
The Litigation Daily reports that a federal judge on Oct. 22
refused to dismiss a proposed ERISA class action against Fannie
Mae, former CEO Daniel Mudd and nearly two dozen other current and
former Fannie Mae directors and officers, ruling that plaintiffs'
lawyers had adequately made the case that the defendants should
have known that Fannie's all-company stock retirement plan was a
recipe for disaster.
GOLDMAN SACHS: Seeks Review of 2nd Circuit Ruling on MBS Suits
--------------------------------------------------------
The Litigation Daily reports that after suffering a stinging
appellate court defeat, Goldman Sachs has called in some heavy
hitters to help it do battle before the U.S. Supreme Court. The
bank has filed a petition for certiorari asking the justices to
review a Second Circuit ruling that expanded the class of
investors that can bring securities class action claims against
mortgage-backed securities offerers.
HIGHLAND PARK: Class Action Hearing to Continue on December 5
-------------------------------------------------------------
Shawn D. Lewis, writing for The Detroit News, reports that a
hearing was continued on Oct. 31 until next month in a class-
action lawsuit filed against the state and the Highland Park
Schools over students' performance in reading.
The hearing in Wayne County Circuit Court will resume at 9:00 a.m.
Dec. 5 before Judge Robert L. Ziolowski. It was continued to
allow the state, the district and the American Civil Liberties
Union of Michigan -- which filed the suit July 12 -- to conduct
discovery and collect more evidence.
The suit claims the district failed to take effective steps to
ensure students are reading at grade level, as required by state
law and Michigan Constitution.
An independent evaluation to determine reading levels found
students were reading between four and eight grades below their
current grade level, the ACLU alleges. The complaint also claims
Highland Park schools are plagued by a lack of books, outdated
materials and filthy classrooms and bathrooms.
According to the suit, fewer than 10 percent of the district's
students in grades 3-8 are proficient in reading and math, based
on Michigan Education Assessment Program scores. By 11th grade,
fewer than 10 percent of students score proficient in reading or
math on the Michigan Merit Exam.
The schools were changed to charter schools Sept. 4, and now are
under the direction of the Leona Group. The original lawsuit was
amended to include Leona.
The state filed a motion Aug. 16 seeking to have the suit
dismissed.
INTERNATIONAL UNION: Members File RICO Class Action
---------------------------------------------------
Rebekah Kearn at Courthouse News Service reports that top bosses
of the International Union of Operating Engineers Local 501
embezzled "tens of millions of dollars" and ran the union "with
the same disregard for others' rights as the mob," 10 members say
in a federal RICO class action.
Lead plaintiff Finn Pette and other members of Local 501 sued the
International Union of Operating Engineers and 27 of its officers,
including president James Callahan, former president Vince Giblin,
and 13 vice presidents. Able Engineering Services and ABM
Engineering Services are also named as defendants.
"This action arises from years of illegal activity by the
International Union of Operating Engineers and its controlling
officers and co-conspirators," the complaint states. "Local 501,
a local trade union, and its members, were victimized by those
many years of illegal activity. The unlawful abuses suffered by
Local 501 and its members takes three predominant forms. First,
millions upon millions of dollars were withheld and/or embezzled
from Local 501 and its membership. Second, Local 501 was
prevented from expanding its membership; the employers violating
their contracts with Local 501 were protected by defendants, who
were receiving kickbacks for their protection. And third, the
membership of Local 501 was denied the right to freely select its
own officers, through fair and honest elections.
"The conduct of defendants harkens back to the days of unrepentant
racketeering by organized crime, which makes some sense here. The
International Union of Operating Engineers conducts its affairs
with the same disregard for others' rights as the mob. Not
surprisingly, the International Union of Operating Engineers has a
long history of ties to organized crime families in New York and
New Jersey, and they have apparently learned their techniques from
the very best of those crime syndicates."
The 400,000-member union represents "heavy equipment operators,
mechanics, and surveyors in the construction industry, and
stationary engineers, who work in operations and maintenance in
building and industrial complexes, and in the service industries.
IUOE also represents nurses and other health industry workers, a
significant number of public employees engaged in a wide variety
of occupations, as well as a number of job classifications in the
petrochemical industry," according to the complaint.
The union, founded in 1896, has 123 locals throughout the United
States and Canada and is the 10th largest union in the AFL-CIO,
members say.
Many of the plaintiffs were union officers, including James
McLaughlin, who was the Local 501's business manager and a vice
president for more than years, until he was "forced to resign in
2009," according to the complaint.
The plaintiffs claim former General President Vince Giblin, a
defendant, told officers in Local 501 that "if they wanted to
serve as an officer, they had no choice but to contribute to the
President's Club, in amounts ranging from hundreds to thousands of
dollars."
They claim that defendant Dennis Lundy, director of the Local 501
Apprenticeship Trust Account, embezzled money. The plaintiffs say
Lundy forged McLaughlin's signature on checks and charged "many
thousands of dollars in lunches to the fund, though the lunches
were not for any Fund business purposes. Instead, Mr. Lundy was
having an affair with [defendant] Cynthia Escanuelas, an employee
of Local 501."
After Mr. Giblin promoted Lundy to Western Regional Director,
Mr. McLaughlin reviewed the fund's financial statements and
discovered "a number of improper, personal charges related to
food, beverage, and travel purchases," the complaint states.
Mr. McLaughlin says he recruited Finn Pette, Local 501's former
financial secretary, and plaintiff Daniel Himmelberg, a former
assistant business manager, to investigate the alleged
embezzlement. He also hired an outside accounting firm for an
audit, Mr. McLaughlin says.
"An outside auditor concluded that of $56,670.51 charged to the
Apprenticeship Trust Fund by Lundy from January 2007 to July 2007,
$13,087.19 constituted meals and entertainment, $13,223.70
constituted travel and lodging, and $16,810.45 constituted books
and equipment. Many of Lundy's charges were for nothing more than
expensive lunches with his mistress," the complaint states.
The plaintiffs say the auditor found that Mr. Lundy made other
extravagant charges to the company credit cards during 2006.
"During that time, of $84,352 charged, $20,635.05 constituted
meals and entertainment, $24,397.52 constituted travel and
lodging, and $30,380.11 constituted books and equipment," the
complaint states.
The auditor found another $28,981.54 in unsupported charges,
according to the complaint.
"It is believed that some of the unsupported charges were false
submissions used to embezzle funds for a cosmetic breast
augmentation procedure Lundy obtained for Cynthia Escanuelas," the
complaint states.
When Mr. Giblin learned about the audits, the plaintiffs say, he
threatened McLaughlin and ordered him to stop the investigation.
When Mr. McLaughlin refused, Mr. Giblin threatened his life, and
the lives of Pette and Himmelberg, according to the complaint.
The threats came during a March 10, 2010 phone call to plaintiff
Robert Fox, previous business manager for Local 501 and a friend
of Mr. Giblin's father, the complaint states: "When Mr. Fox
advised Mr. Giblin that he did not want Giblin to take action
against Jim McLaughlin, Dan Himmelberg and Finn Pette, the
conversation became even more confrontational and Mr. Giblin
stated that he would kill or have these three union officers
killed."
The complaint continues: "Mr. Fox believed the threats from Mr.
Giblin to be genuine. Mr. Fox believed that Vince Giblin had the
ability to order the deaths of Mr. McLaughlin, Mr. Himmelberg, and
Mr. Pette because of Mr. Giblin's connection to organized crime in
New Jersey, Vince Giblin's home territory.
"In direct response to the death threat made by Giblin against
three of the union officers of Local 501, Mr. Fox contacted these
three individuals and strongly suggested they purchase guns to
protect themselves. Mr. Fox refused to discuss anything over the
phone because he knew Giblin had a penchant for wiretapping and
eavesdropping on calls and Mr. Fox feared his own phone was tapped
by Giblin. Moreover, he refused to meet the subjects of the death
threats at his home for his safety, his wife's safety, and the
safety of the union officers.
"In fact, for the past several years, IUOE has exercised total
control over Local 501, all for the purpose of preventing any
discovery or disruption of the many kickback schemes in place that
divert tens of millions of dollars from Local 501 and its members
to leaders of the IUOE, including past IUOE General President
Vince Giblin, the current General President, Callahan, high
ranking IUOE employees of headquarters and the past and current
vice presidents that do the bidding of the IUOE General
President."
The plaintiffs say Mr. Giblin forced Mr. McLaughlin to resign as a
senior vice president in June 2009, by threatening to fire Pette
and Himmelberg and to place Local 501 under trusteeship.
In a previous call from Mr. Giblin, on June 9, 2009, Mr. Giblin
told Fox: "'I told that fat fuck [James McLaughlin] to make that
Lundy thing disappear and he never did. That lazy fat fuck has
got to go!' Mr. Fox was a trusted confidant of Mr. McLaughlin and
knew about the Lundy reference, having already heard from Mr.
McLaughlin that Mr. Lundy had embezzled funds from the
Apprenticeship Trust at Local 501," according to the complaint.
Mr. Giblin ordered Mr. McLaughlin's replacement, defendant Chris
Brown, to fire Messrs. Pette and Himmelberg later that year,
according to the complaint.
The plaintiffs claim that the defendants rigged union elections
by, among other things, forcing a slate of Local 501 candidates
trying to "restore control of Local 501 to Local 501 members" to
register as individuals instead of a slate; banning Pette and
Himmelberg from running for office by bringing false charges
against them; and changing signature collection rules several
times "in an effort to prevent resistance members from qualifying
for the ballot."
The plaintiffs claim that defendants ABM and Able "conspired with
the IUOE to divert or withhold millions of dollars from numerous
member benefit funds."
Able Engineering Services is a San Francisco-based janitorial and
maintenance services provider. ABM Engineering Services has
offices throughout the country and overseas, and offers services
such as electricity, landscaping and security, according to
company Web sites.
Able controls about 25 percent of "all stationary engineering
positions in the state of California," and ABM controls about 70
percent of them, according to the complaint.
During the audit of the Apprenticeship Fund, the plaintiffs say,
Mr. Pette discovered that ABM and Able had shorted the
Apprenticeship Fund $180,000 and $280,000, respectively.
Mr. Pette says he also discovered that the companies had
underfunded the Health & Welfare Fund "by millions of dollars over
the class period" by failing to report employee work hours.
"The underreporting of hours resulted in a staggering cascade of
other harm to Local 501 and its members. First, the
underreporting of hours deprived Local 501 of much-needed
administrative operating contributions that would have been much
higher had the correct number of hours been reported. This harmed
Local 501's ability to operate. Second, Able and ABM were
underfunding their contributions to the General Pension Fund,
which contributions also depend on the number of hours worked,"
the complaint states.
The plaintiffs say the defendants conspired to engage in
racketeering against Local 501, threatened people to hide their
"kickback schemes" and control elections, took kickbacks from Able
and ABM, and embezzled money from local.
"The fraudulent, unlawful and improper activities of the
defendants threatens to continue. Based upon the past pattern of
activity, other local unions either have or will likely be
defrauded by the defendants. Based upon the past pattern of
activity, the defendants will likely continue to defraud Local
Unions like Local 501. Furthermore, the defendants are able,
based upon their managerial and controlling positions, to replace
management in local unions, which should thereafter be defrauded
and looted without consequence in a similar manner to the schemes
and artifices outlined herein," the complaint states.
The plaintiffs seek compensatory, treble, and exemplary damages of
at least $7.5 million for RICO violations, violations of the Labor
Management Disclosure Act, and aiding and abetting. They seek
disgorgement of the allegedly embezzled money, and appointment of
a receiver to "operate defendant IUOE in a lawful manner, to
assure the cessation of its illegal acts and to assure the proper
handling of income and payments."
They are represented by Ira Spiro with Spiro Moore.
Here are the defendants: International Union of Operating
Engineers, James Callahan, Brian Hickey, William Waggoner, Patrick
Sink, Jerry Kalmar, Russell Burns, Rodger Kaminska, James Sweeney,
Robert Heenan, Daniel McGraw, Daren Konopaski, Michael Gallagher,
Greg Lalevee, Terrance McGowan, Louis Rasetta, Vince Giblin, James
Van Dyke, Richard Griffin, Chris Brown, Lewis Levy, Randy
Henningfield, Paul Bensi, Sandra Acosta, Cornell Sneaks, Jim
Scranton, Dennis Lundy, Cynthia Escanuelas, Able Engineering
Services, and ABM Engineering Services.
JOHNSON & JOHNSON: Judge Approves $10-Mil. Attorneys' Fees
----------------------------------------------------------
Lorraine Bailey at Courthouse News Service reports that Johnson &
Johnson can institute corporate governance changes and pay $10
million in attorneys' fees to settle a shareholder complaint, a
federal judge ruled.
Several derivative actions consolidated in the District of New
Jersey claimed that Johnson & Johnson (J&J) grossly mismanaged the
company for more than a decade by paying kickbacks to doctors who
prescribed Johnson & Johnson drugs and medical devices.
After negotiations began, the court dismissed eight of the suits
without prejudice for lack of specificity, but these plaintiffs
continued to participate in the settlement discussions.
Under terms of the settlement, Johnson & Johnson's board will
adopt a Quality and Compliance Core Objective to correct
noncompliance with drug-marketing laws.
The board will also establish a Regulatory, Compliance &
Government Affairs Committee to assist the board with compliance
issues, and implement a new product risk management standard for
all Johnson & Johnson subsidiaries.
U.S. District Judge Freda Wolfson approved the deal last week,
noting that shareholders would face an uphill procedural battle if
the negotiations failed.
"Here, plaintiffs face significant hurdles in proving their
cases," Judge Wolfson wrote. "J&J succeeded in its motion to
dismiss against the demand-futility plaintiffs, and no amended
complaint has been filed for the Court to assess whether an
amended complaint could withstand a second attack. As I suggested
in granting J&J's dismissal motion, while J&J's alleged conduct
was troubling, it was not clear that the Board members were aware
of red flags and chose to ignore them. And, mere negligence is
not enough to create liability."
The terms of the settlement represent a board commitment to
greater quality control and compliance with drug marketing laws,
the decision states.
"By agreeing to create and operate RCGC [Regulatory, Compliance &
Government Affairs Committee], the J&J board will further cement
its now centralized role in overseeing J&J's compliance with drug
marketing laws and cGMP [current good manufacturing practices],"
Judge Wolfson wrote. "I find that this reform is tailored to
remedy the plaintiffs' overarching allegation that the board
insulated itself from reporting on quality control issues. In
addition, as [plaintiffs' expert] Dr. [Mitchell] Glass notes, the
creation of the committee constitutes a best practice, which is
tailored to remedy the plaintiffs' allegation that J&J failed to
institute good manufacturing practices in its subsidiaries."
The judge also noted that, "while some may argue that monetary
relief would amount to a greater recovery, the Supreme Court and
Court of Appeals have made clear that injunctive relief, on its
own, may constitute a significant benefit for the corporation."
Johnson & Johnson must also pay $10 million in attorneys' fees,
along with $450,000 in costs, according to the ruling.
Earlier in the action, the court appointed Abraham, Fruchter &
Twersky as lead counsel. Kantrowitz, Goldhamer & Graifman served
as liaison counsel.
Carella, Byrne, Cecchi, Olstein, Brody & Agnello; Morris and
Morris Counselors at Law; Robbins Geller Rudman & Dowd LLP; and
Bernstein Litowitz Berger & Grossmann also represented the
shareholders.
A copy of the Opinion in In Re Johnson & Johnson Derivative
Litigation, Case No. 11-cv-04993 (D. N.J.), is available at:
http://www.courthousenews.com/2012/11/01/J&J.pdf
LUMBER LIQUIDATORS: Faces "Prusak" Class Suit in Illinois
---------------------------------------------------------
Lumber Liquidators Holdings, Inc. is facing a class action lawsuit
initiated by Jaroslaw Prusak in Illinois, according to the
Company's October 24, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended September
30, 2012.
On August 30, 2012, Jaroslaw Prusak, a purported customer (the
"Plaintiff"), filed a putative class action lawsuit against the
Company in the United States District Court for the Northern
District of Illinois. The Plaintiff alleges that the Company
willfully violated the Fair and Accurate Credit Transactions Act
("FACTA") amendment to the Fair Credit Reporting Act in connection
with printed credit card receipts provided to its customers. The
Plaintiff, for himself and the putative class, seeks statutory
damages of no less than $100 and no more than $1,000 per
violation, punitive damages, attorney's fees and costs, and other
relief. The Company intends to vigorously defend this matter and,
given the uncertainty of litigation, no outcome can be predicted
at this time. The Company does not, at this time, expect the
outcome of this proceeding to have a material adverse effect on
its results of operations, financial position or cash flows.
MANNKIND CORP: Nov. 19 Hearing Set for Derivative Action Deal
-------------------------------------------------------------
In an October 22, 2012, Form 8-K/A filing with the U.S. Securities
and Exchange Commission, MannKind Corporation reported that the
correct date of the final approval hearing for a proposed
settlement of the Derivative Actions as defined in the original
Form 8-K report is November 19, 2012.
On September 12, 2012, the United States District Court for the
Central District of California entered an order preliminarily
approving a proposed settlement of the class action securities
lawsuits consolidated under the caption In re MannKind Corp.
Securities Litigation, Master File No. 11-cv-00929-GAF (SSx), and
entered a separate order preliminarily approving a proposed
settlement of the federal derivative lawsuits consolidated under
the caption In re MannKind Corp. Derivative Litigation, Case No.
11-cv-05003-GAF-SSx (the "Federal Derivative Action"). The
proposed settlement in the Federal Derivative Action would also
resolve the state derivative lawsuits consolidated under the
caption In re MannKind Corporation Derivative Shareholder
Litigation, Case No. BC454931, pending in the Superior Court of
California, County of Los Angeles (the "State Derivative Action").
The Company refers to the Federal Derivative Action and the State
Derivative Action collectively as the Derivative Actions.
In the order preliminarily approving the proposed settlement in
the Securities Action, the U.S. District Court approved the Notice
of Proposed Settlement of Class Action, the Summary Notice of
Pendency and Proposed Settlement of Class Action, and proof of
claim and release forms. The Court authorized the distribution of
such forms to all potential settlement class members and appointed
Garden City Group as the settlement administrator to supervise and
administer the notice and claim procedures. The proposed
settlement in the Securities Action remains subject to final
approval by the U.S. District Court. A final approval hearing is
set for December 17, 2012 before the Honorable Gary Allen Feess in
the United States District Court for the Central District of
California.
In the order preliminarily approving the proposed settlement in
the Derivative Actions, the U.S. District Court approved the
Notice of Proposed Settlement and of Settlement Hearing. A copy
of the Derivative Actions Notice is available at the SEC at
http://is.gd/rP9tM2 The Derivative Actions Notice and the
Stipulation of Settlement dated August 3, 2012 are also available
on the Company's website at http://www.investors.mannkindcorp.com
The proposed settlement in the Derivative Actions remains subject
to final approval by the U.S. District Court. A final approval
hearing is set for November 19, 2012 before the Honorable Gary
Allen Feess in the United States District Court for the Central
District of California.
NEWS CORP: Bid to Dismiss 3rd Amended Consolidated Suit Pending
---------------------------------------------------------------
News Corporation is awaiting a court decision on its renewed plea
to dismiss a third amended consolidated shareholder complaint in
Delaware, according to the Company's August 14, 2012, Form 10-K
filing with the U.S. Securities and Exchange Commission for the
fiscal year ended June 30, 2012.
On March 16, 2011, two purported shareholders of the Company, one
of which was Central Laborers Pension Fund, filed a derivative
action in the Delaware Court of Chancery, captioned The
Amalgamated Bank v. Murdoch, et al. (the Amalgamated Bank
Litigation). The plaintiffs alleged that both the directors of
the Company and Rupert Murdoch as a "controlling shareholder"
breached their fiduciary duties in connection with the Company's
purchase of Shine Limited, an international television production
and distribution group. The suit named as defendants all
directors of the Company, and named the Company as a nominal
defendant. Similar claims against the same group of defendants
were filed in the Delaware Court of Chancery by a purported
shareholder of the Company, New Orleans Employees' Retirement
System, on March 25, 2011 (the New Orleans Employees' Retirement
Litigation). Both the Amalgamated Bank Litigation and the New
Orleans Employees' Retirement Litigation were consolidated on
April 6, 2011, with The Amalgamated Bank's complaint serving as
the operative complaint. The Consolidated Action was captioned In
re News Corp. Shareholder Derivative Litigation. On April 9,
2011, the court entered a scheduling order governing the filing of
an amended complaint and briefing on potential motions to dismiss.
Thereafter, the plaintiffs in the Consolidated Action filed a
Verified Consolidated Shareholder Derivative and Class Action
Complaint on May 13, 2011, seeking declaratory relief and damages.
The Consolidated Complaint largely restated the claims in The
Amalgamated Bank's initial complaint and also raised a direct
claim on behalf of a purported class of Company shareholders
relating to the possible addition of Elisabeth Murdoch to the
Company's Board. The defendants filed opening briefs in support
of motions to dismiss the Consolidated Complaint on June 10, 2011,
as contemplated by the court's scheduling order. On July 8, 2011,
the plaintiffs filed a Verified Amended Consolidated Shareholder
Derivative and Class Action Complaint. In addition to the claims
that were previously raised in the Consolidated Complaint, the
Amended Complaint brought claims relating to the alleged acts of
voicemail interception at The News of the World (the "NoW
Matter"). Specifically, the plaintiffs claimed in the Amended
Complaint that the directors of the Company failed in their duty
of oversight regarding the NoW Matter.
On July 15, 2011, another purported stockholder of the Company
filed a derivative action captioned Massachusetts Laborers'
Pension & Annuity Funds v. Murdoch, et al., in the Delaware Court
of Chancery (the "Mass. Laborers Litigation"). The complaint
names as defendants the directors of the Company and the
Company as a nominal defendant. The plaintiffs' claims are
substantially similar to those raised by the Amended Complaint in
the Consolidated Action. Specifically, the plaintiff alleged that
the directors of the Company have breached their fiduciary duties
by, among other things, approving the Shine Transaction and for
failing to exercise proper oversight in connection with the NoW
Matter. The plaintiff also brought a breach of fiduciary duty
claim against Rupert Murdoch as "controlling shareholder," and a
waste claim against the directors of the Company. The action
seeks as relief damages, injunctive relief, fees and costs. On
July 25, 2011, the plaintiffs in the Consolidated Action requested
that the court consolidate the Mass. Laborers Litigation into the
Consolidated Action. On August 24, 2011, the Mass. Laborers
Litigation was consolidated with the Consolidated Action.
On September 29, 2011, the plaintiffs filed a Verified Second
Amended Consolidated Shareholder Derivative and Class Action
Complaint. In the Second Amended Complaint, the plaintiffs
removed their claims involving the possible addition of Elisabeth
Murdoch to the Company's Board, added some factual allegations to
support their remaining claims and added a claim seeking to enjoin
a buyback of Common B shares to the extent it would result in a
change of control. The Second Amended Complaint seeks declaratory
relief, an injunction preventing the buyback of Class B shares,
damages, pre- and post-judgment interest, fees and costs.
The defendants filed a motion to dismiss the Second Amended
Complaint. The hearing on the defendants' fully briefed motion to
dismiss was postponed to allow further briefing by plaintiffs
after another litigation called the "Cohen Litigation," was
consolidated with the Consolidated Action.
On March 2, 2012, another purported stockholder of the Company
filed a derivative action captioned Belle M. Cohen v. Murdoch, et
al., in the Delaware Court of Chancery (the Cohen Litigation). The
complaint names as defendants the directors of the Company and the
Company as a nominal defendant. The complaint's claims and
allegations pertain to the NoW Matter and are substantially
similar to the NoW Matter allegations raised in the Second Amended
Complaint in the Consolidated Action. The complaint asserts
causes of action against the defendants for alleged breach of
fiduciary duty, gross mismanagement, contribution and
indemnification, abuse of control, and waste of corporate assets.
The action seeks as relief damages, fees and costs. On March 20,
2012, the Cohen Litigation was consolidated with the Consolidated
Action.
On June 18, 2012, the plaintiffs in the Consolidated Action filed
a Verified Third Amended Consolidated Shareholder Derivative
Complaint. The Third Amended Complaint alleges claims against
director defendants for breach of fiduciary duty arising from the
Shine Transaction; against Rupert Murdoch for breach of fiduciary
duty as the purported controlling shareholder of the Company in
connection with the Shine Transaction; against director defendants
for breach of fiduciary duty arising from their purported failure
to investigate illegal conduct in the NoW Matter and allegedly
permitting the Company to engage in a cover up; against certain
defendants for breach of fiduciary duty in their capacity as
officers arising from a purported failure to investigate illegal
conduct in the NoW Matter and allegedly permitting the Company to
engage in a cover up; and against James Murdoch for breach of
fiduciary duty for allegedly engaging in a cover up related to the
NoW Matter. The class action claim asserted in the Second Amended
Complaint pertaining to the buyback of Common B shares and the
relief related to that claim were removed. The Third Amended
Complaint seeks a declaration that the defendants violated their
fiduciary duties, damages, pre- and post-judgment interest, fees
and costs.
On July 18, 2012, the defendants renewed their postponed motion to
dismiss in the Consolidated Action, and in support thereof, they
filed supplemental briefing directed towards the allegations of
the Third Amended Complaint. Plaintiffs' response was due last
August 8, 2012, and the hearing date was set for September 19,
2012.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America.
NEWS CORP: "Forsta Ap-Fonden" Class Suit Pending in Delaware
------------------------------------------------------------
News Corporation continues to defend itself against an amended
shareholder class action complaint commenced by Forsta Ap-Fonden
in Delaware, according to the Company's August 14, 2012, Form 10-K
filing with the U.S. Securities and Exchange Commission for the
fiscal year ended June 30, 2012.
On May 30, 2012, a purported stockholder of the Company filed a
class action lawsuit in the Delaware Court of Chancery on behalf
of all non-U.S. stockholders of the Company's Class B shares,
captioned Forsta Ap-Fonden v. News Corporation, et al. The
plaintiff alleges that, by temporarily suspending 50% of the
voting rights of the Class B shares held by non-U.S. stockholders
to remain in compliance with U.S. governing broadcast licenses
(the "Suspension"), the Company and the Board violated the
Company's charter and the General Corporation Law of the State of
Delaware ("DGCL") and the directors breached their fiduciary
duties, both in approving the Suspension and in failing to monitor
the Company's ownership by non-U.S. stockholders. The complaint
named as defendants the Company and all directors of the Company
at the time of the Suspension. The complaint sought a declaration
that the defendants violated the Company's charter and the DGCL, a
declaration that the directors breached their fiduciary duties, a
declaration that the Suspension is invalid and unenforceable, an
injunction of the Suspension, damages, fees, and costs. On June
11, 2012, the defendants filed an opening brief in support of a
motion to dismiss the complaint in its entirety. On August 2,
2012, the plaintiff filed a Verified Amended and Supplemented
Class Action Complaint. The Amended and Supplemented Complaint
seeks a declaration that the defendants violated the Company's
charter and the DGCL, a declaration that the directors breached
their fiduciary duties, a declaration that the Suspension is
invalid and unenforceable, an injunction of the Suspension, a
declaration that non-U.S. stockholders of the Company's Class B
shares are entitled to vote all of their shares on the Proposed
Separation Transaction, damages, fees, and costs.
The Company and its directors believe that the plaintiff's claims
are entirely without merit and intend to vigorously defend this
action.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America. The Company is engaged in the publishing business,
primarily through its subsidiaries News International, News
Limited, Dow Jones, The New York Post, The Daily, HarperCollins
Publishers and News America Marketing Group.
NEWS CORP: Still Defends "Wilder" Securities Suit in New York
-------------------------------------------------------------
News Corporation continues to defend itself against a securities
class action lawsuit pending in New York, according to the
Company's August 14, 2012, Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended June
30, 2012.
On July 19, 2011, a purported class action lawsuit captioned
Wilder v. News Corp., et al. ("Wilder Litigation"), was filed on
behalf of all purchasers of the Company's common stock between
March 3, 2011 and July 11, 2011, in the United States District
Court for the Southern District of New York. The plaintiff
brought claims under Section 10(b) and Section 20(a) of the
Securities Exchange Act, alleging that false and misleading
statements were issued regarding alleged acts of voicemail
interception at The News of the World (the "NoW Matter"). The
suit names as defendants the Company, Rupert Murdoch, James
Murdoch and Rebekah Brooks, and seeks compensatory damages,
rescission for damages sustained, and costs.
No updates were reported in the Company's latest Form 10-K filing.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America. The Company is engaged in the publishing business,
primarily through its subsidiaries News International, News
Limited, Dow Jones, The New York Post, The Daily, HarperCollins
Publishers and News America Marketing Group.
NEWS CORP: Consumer Suit vs. HarperCollins Still Pending in N.Y.
----------------------------------------------------------------
News Corporation's subsidiary continues to defend itself in a
consolidated antitrust consumer lawsuit in New York, according to
the Company's August 14, 2012, Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended June
30, 2012.
Commencing on August 9, 2011, about 29 purported consumer class
actions have been filed in the U.S. District Courts for the
Southern District of New York and for the Northern District of
California, which relate to the decisions by certain publishers,
including HarperCollins Publishers L.L.C., a subsidiary of News
Corporation, to begin selling their eBooks pursuant to an agency
relationship. The cases all involve allegations that certain
named defendants in the book publishing and distribution industry,
including HarperCollins, violated the antitrust and unfair
competition laws by virtue of the switch to the agency model for
eBooks. The actions seek as relief treble damages, injunctive
relief and attorneys' fees. The Judicial Panel on Multidistrict
Litigation has transferred the various class actions to the
Honorable Denise L. Cote in the Southern District of New York. On
January 20, 2012, plaintiffs filed a consolidated amended
complaint, again alleging that certain named defendants, including
HarperCollins, violated the antitrust and unfair competition laws
by virtue of the switch to the agency model for eBooks.
Defendants filed a motion to dismiss on
March 2, 2012. On May 15, 2012, Judge Cote denied defendants'
motion to dismiss. On June 22, 2012, Judge Cote held a status
conference to address discovery and scheduling issues. On
June 25, 2012, Judge Cote issued a scheduling order for the multi-
district litigation going forward. The case is captioned In re
MDL Electronic Books Antitrust Litigation, Civil Action No. 11-md-
02293 (DLC). While it is not possible to predict with any degree
of certainty the ultimate outcome of these class actions,
HarperCollins believes it was compliant with applicable antitrust
and competition laws.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America. The Company is engaged in the publishing business,
primarily through its subsidiaries News International, News
Limited, Dow Jones, The New York Post, The Daily, HarperCollins
Publishers and News America Marketing Group.
NEWS CORP: Consumer Suits vs. HarperCollins Pending in Canada
-------------------------------------------------------------
News Corporation's subsidiary continues to defend itself in
consumer lawsuits in Canada, according to the Company's August 14,
2012, Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended June 30, 2012.
Commencing on February 24, 2012, five purported consumer class
actions were filed in the Canadian provinces of British Columbia,
Quebec and Ontario, which relate to the decisions by certain
publishers, including HarperCollins Publishers L.L.C., a
subsidiary of News Corporation, to begin selling their eBooks in
Canada pursuant to an agency relationship. The actions seek as
relief special, general and punitive damages, injunctive relief
and the costs of the litigations. While it is not possible to
predict with any degree of certainty the ultimate outcome of these
class actions, especially given their early stages, HarperCollins
believes it was compliant with applicable antitrust and
competition laws and intends to defend itself vigorously.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America. The Company is engaged in the publishing business,
primarily through its subsidiaries News International, News
Limited, Dow Jones, The New York Post, The Daily, HarperCollins
Publishers and News America Marketing Group.
NEWS CORP: Appeals From Intermix Suit Settlement Dismissed
----------------------------------------------------------
All appeals from the settlement of a class action lawsuit
resulting from News Corporation's acquisition of Intermix Media
Inc., have been dismissed, the Company disclosed in its August 14,
2012, Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended June 30, 2012.
The Company acquired Intermix Media, Inc. on September 30, 2005
and as a result of that transaction, several lawsuits were filed
against Intermix, the board of directors of Intermix, officers of
Intermix and certain investors. These cases have either been
settled for immaterial amounts or have been dismissed. On October
2010, the parties agreed to a settlement of the final outstanding
class action. In March 2012, the court entered an order approving
the settlement. Thereafter, two notices of appeal were filed.
One appeal was dismissed as untimely, and the other was dismissed
because the appellant did not pay the required fees. The Company
recognized the terms of this settlement in its results of
operations in fiscal 2011 and the amounts recognized were not
material to the Company.
News Corporation, a Delaware corporation, is a diversified global
media company with operations in the following six industry
segments: (i) Cable Network Programming; (ii) Filmed
Entertainment; (iii) Television; (iv) Direct Broadcast Satellite
Television; (v) Publishing; and (vi) Other. The Company's
activities are conducted principally in the United States, the
United Kingdom, Continental Europe, Australia, Asia and Latin
America. The Company is engaged in the publishing business,
primarily through its subsidiaries News International, News
Limited, Dow Jones, The New York Post, The Daily, HarperCollins
Publishers and News America Marketing Group.
PERDUE FOODS: Recalls 1,440 Lbs. of Chicken Breast Nuggets
----------------------------------------------------------
Perdue Foods, LLC, a Bridgewater, Virginia establishment, is
recalling approximately 1,440 pounds of chicken breast nugget
products because of misbranding and an undeclared allergen, milk,
not declared on the label, the U.S. Department of Agriculture's
Food Safety and Inspection Service (FSIS) announced.
The products subject to recall include:
* Bundled packages containing 3 12-oz. tray packs of "Perdue
Original Chicken Breast Nuggets." Each package bears the
establishment number "P. 369" inside the USDA mark of
inspection and a "Sell By" of December 16, 2012.
The products were produced on October 16, 2012, and distributed to
retail stores in Connecticut, Delaware, Massachusetts, Maryland,
North Carolina, New Jersey, New York, Ohio, Pennsylvania and
Virginia. When available, the retail distribution list(s) will be
posted on FSIS' Web site at:
www.fsis.usda.gov/FSIS_Recalls/Open_Federal_Cases/index.asp
The problem was discovered by the company and occurred as a result
of an ingredient reformulation and a labeling error. FSIS and the
Company have not received reports of adverse reactions due to
consumption of these products. Anyone concerned about a reaction
should contact a healthcare provider.
FSIS routinely conducts recall effectiveness checks to verify
recalling firms notify their customers of the recall and that
steps are taken to make certain that the product is no longer
available to consumers.
Consumers with questions about the recall should contact Purdue
Consumer Relations at 1-877-727-3447. Media with questions about
the recall should contact Julie DeYoung, corporate communications
spokesperson at (410) 341-2193.
Consumers with food safety questions can "Ask Karen," the FSIS
virtual representative available 24 hours a day at AskKaren.gov or
via smartphone at m.askkaren.gov. "Ask Karen" live chat services
are available Monday through Friday from 10:00 a.m. to 4:00 p.m.
Eastern Time. The toll-free USDA Meat and Poultry Hotline 1-888-
MPHotline (1-888-674-6854) is available in English and Spanish and
can be reached from 10:00 a.m. to 4:00 p.m. (Eastern Time) Monday
through Friday. Recorded food safety messages are available 24
hours a day.
FSIS Lists Stores That Received Recalled Products
The U.S. Department of Agriculture's Food Safety and Inspection
Service disclosed that BJ's Club Stores in Connecticut, Delaware,
Massachusetts, Maryland, North Carolina, New Jersey, New York,
Ohio, Pennsylvania, and Virginia received the recalled products.
The FSIS says these store locations may not include all retail
locations that have received the recalled product or may include
retail locations that did not actually receive the recalled
product. Therefore, the FSIS says, it is important that consumers
use the product-specific identification information available at
the recall notice, in addition to the list of retail stores, to
check meat or poultry products in the consumers' possession to see
if they have been recalled.
PIEDMONT OFFICE: Negotiates Tentative Deals in 2 Securities Suits
-----------------------------------------------------------------
Piedmont Office Realty Trust, Inc. (NYSE: PDM) announced on Oct.
22, 2012, that it has reached agreements in principle to settle
two securities class action suits filed against the company and
others in 2007 regarding disclosures in certain SEC filings. The
settlements, which are subject to court approval following the
negotiation and execution of definitive agreements and notice to
the classes, will resolve the appeals and result in the final
disposition of both cases.
The first suit challenged disclosures made in connection with
Piedmont's April 2007 internalization transaction. On September
26, 2012, the Court granted Defendants' motion for summary
judgment, and entered judgment in Defendants' favor dismissing all
claims.
The second suit challenged disclosures made in separate 2007
Piedmont SEC filings relating to a tender offer and a charter
amendment. On August 27, 2012, the Court granted Defendants'
motion to dismiss, and entered judgment in Defendants' favor
dismissing all claims. Plaintiffs had recently appealed both
judgments to the Eleventh Circuit Court of Appeals.
Under the terms of the proposed settlements, Plaintiffs will
dismiss the appeals of both suits and release all Defendants from
liability in exchange for a total cash payment by Piedmont and its
insurers of $4.9 million in the first suit, and $2.6 million in
the second suit. While Piedmont has denied the allegations of
these suits and has denied any liability to Plaintiffs, Piedmont's
non-defendant independent directors approved the settlements to
eliminate the uncertainties, burden and expense of further
protracted litigation. The settlement amounts are within the
respective limits of Piedmont's directors and officers' liability
insurance policies, and Piedmont intends to seek recovery of the
full amount of the settlements from its insurance carriers;
however, the amounts that will ultimately be recovered from the
carriers is uncertain.
"After more than five years, we are gratified to receive the
recent rulings of the Court entering judgments in our favor and
dismissing both cases, and we are satisfied that we reached
agreements to end the appeals and finally dispose of these cases,"
said Chief Executive Officer Donald A. Miller, CFA. "Our focus
has been and will continue to be upon building long term value for
our shareholders."
Piedmont Office Realty Trust, Inc. (NYSE:PDM) is a fully-
integrated and self-managed real estate investment trust (REIT)
specializing in high-quality, Class A office properties located
primarily in the ten largest U.S. office markets, including
Chicago, Washington, D.C., New York, Dallas, Los Angeles and
Boston. As of September 30, 2012, Piedmont's 74 wholly-owned
office buildings were comprised of approximately 20.5 million
rentable square feet. The Company is headquartered in Atlanta, GA
with local management offices in each of its major markets.
Investment-grade rated by Standard & Poor's and Moody's, Piedmont
has maintained a low-leverage strategy while transacting $5.9
billion and $1.7 billion in property acquisitions and
dispositions, respectively, during its fourteen year operating
history. For more information, see www.piedmontreit.com.
PORSCHE: HID Headlights Class Actions Obtains Certification
-----------------------------------------------------------
Daily Business Review reports that a Florida judge has granted
class certification to hundreds of disgruntled Porsche owners who
had to replace stolen "high-intensity discharge" headlights. The
suit alleges the German-made automobiles had a design flaw that
made the HID headlights "particularly vulnerable to theft" and
that the U.S. distributor failed to find a remedy.
SPRINT NEXTEL: Being Sold to Softbank for Too Little, Suit Says
---------------------------------------------------------------
Joe Harris at Courthouse News Service reports that Sprint Nextel
is selling itself too cheaply through an unfair process to
SoftBank, in a cash and stock swap worth more than $3.1 billion,
shareholders say in a class action.
Lead plaintiff Dennis J. Seltzer says the 3-step process includes
$3.1 billion in cash, a prorated stock swap valuing Sprint common
stock at $7.30 a share, and the option for SoftBank to buy 54.6
million more shares of "New Sprint" at $5.25.
"The board owes Sprint's public stockholders the well-known duty
to maximize stockholder value in connection with a change-in-
control transaction," according to the complaint in Johnson County
Court.
"However, they completely failed this duty here. Rather than
conduct an auction of the company or other market check to
determine the highest available price for Sprint, in the span of
approximately one week the board quickly abandoned its long-
standing plan to grow through strategic acquisitions and instead
sold control of Sprint to SoftBank for an inferior price in the
sweetheart transaction that favored SoftBank's interests."
The plaintiffs claim the Sprint board included a variety of
"defensive measures" to make sure SoftBank took over the company.
Those measures include a bond that will increase the cost of
acquiring Sprint to a competitive bidder, a $600 million
termination fee, a $75 million cost reimbursement requirement and
giving SoftBank the right to match -- not exceed -- any other
offer.
Sprint had more than 56 million customers at the end of the second
quarter in 2012 and was the first national carrier to offer 4G
Internet service, according to the company Web site.
The class consists of all Sprint common stock holders as of
Oct. 15, 2012.
It asks the court to void the merger and require Sprint to
undertake a sales process that maximizes shareholder value.
The Plaintiffs are represented by:
Thomas Buchanan, Esq.
MCDOWELL, RICE, SMITH & BUCHANAN
Skelly Building, Suite 350
605 West 47th Street
Kansas City, MO 64112
Telephone: (816) 753-5400
E-mail: tbuchanan@mcdowellrice.com
SOUTH CAROLINA: Revenue Dept. Faces Class Action Over Hacking
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Aaron Barker, writing for FOX Carolina, reports that an Upstate
law firm has filed the first class-action lawsuit against South
Carolina Gov. Nikki Haley and the state Department of Revenue in
connection with a hacking case that resulted in theft of 3.6
million Social Security numbers.
Gov. Haley announced on Oct. 26 that a hacker with an
international IP address hacked into state Department of Revenue
files containing tax records submitted since 1998. State Law
Enforcement Division Director Mark Keel said state officials
learned of the problem Oct. 10 although the hacker may have gotten
into the files as early as August.
On Oct. 31, the Hawkins Law Firm announced a lawsuit filed in
Richland County that accuses Gov. Haley and the state tax agency
of failing to protect the citizens of South Carolina and violating
a state law that requires prompt disclosure of breaches.
"This hacking amounts to a cyber hurricane, and it's a category
5," said attorney John Hawkins. "Tragically, for the people of
South Carolina, there were cost effective, non-cumbersome steps
that could have been taken by these defendants, but for whatever
reason, they were not."
Mr. Hawkins told FOX Carolina that the lawsuit was filed by a
Spartanburg man whose information was compromised during the cyber
attack. He said that the lawsuit does not seek monetary damages,
but instead seeks to hold leaders accountable.
Gov. Haley has said South Carolina used the same standards as
banks and other private institutions when it decided not to
encrypt Social Security numbers and other information on a
database of state tax returns. She called the attack unbelievably
creative.
Since the hacking, officials have announced that anyone whose
information was compromised is eligible for a year of free credit-
monitoring service and a lifetime of fraud resolution insurance.
People are asked to visit protectmyid.com/scdor and enter code
SCDOR123 or call 1-866-578-5422 to determine if their Social
Security number was accessed.
Eric Connor, writing for GreenvilleOnline.com, reports that during
a press conference, Gov. Haley dismissed the suit, saying, "There
is a trial lawyer with a hand out and a tissue ready at any
crisis."
As new information emerges and taxpayers continue to sign up for
state-sponsored credit protection, legal experts say that exactly
how future legal challenges will unfold depends on what new
information reveals about how the state handled its security.
"It's a little bit of uncharted territory here," said Stephan
Futeral, an adjunct professor at the Charleston School of Law and
an attorney who handles intellectual property cases. "There are a
lot of questions that remain to be answered."
The state's move to offer credit monitoring and insurance for
every South Carolinian affected could serve to take the wind out
of the sails of legal challenges that arise, as previous cases
have shown, experts said.
The legal strategies in suing the state are legion, but generally
revolve around the South Carolina Torts Claims Act, which allows
the public to sue the government for harm, Mr. Futeral said.
However, there are exceptions.
A chief exception is one that protects the state when it is
exercising discretion in its decisions, as opposed to not meeting
an industry standard, he said.
Whether there is a discernible industry standard in cyber
protection that was or wasn't followed won't be known until the
state describes how it secured information and what it knew,
Mr. Futeral said.
"I don't know that these questions will be answered freely without
a lawsuit," he said. "A skillful lawyer could argue that this
wasn't a matter of discretion at all, that this was simply a
matter of dropping the ball. No one knows right now."
The lawsuit filed on Oct. 31 in Richland County focuses on
particulars in state law that mandate an agency reveal data
breaches "in the most expedient time possible and without
unreasonable delay."
The first breach occurred on Aug. 27, Gov. Haley said.
The Department of Revenue learned of the breach on Oct. 10 and
waited until last Friday to announce the theft, citing concerns
over an ongoing investigation, she said.
The suit alleges that the state was negligent in its obligation to
encrypt taxpayers' data so that information couldn't be used if
compromised.
The suit alleges that those affected have been damaged by the
government's actions and face the prospect of identity theft.
What actual harm results could determine how successful any
litigation might be, said Carl Muller, a Greenville attorney in
private practice who has sued the state over the issue of
disclosure of personal data before.
"It will depend on whether there's any resulting damage,"
Mr. Muller said. "I think you do everything you can to find the
hacker, button this thing up as quickly as you can."
In 1999, Mr. Muller represented a South Carolina woman who
challenged the Department of Public Safety's practice of selling
information and images included on state driver's licenses and
identification cards.
In 1998, the department contracted with a company to make the
information available with the promise that it would only be used
to verify the identity of a person when conducting financial or
voter transactions, according to a 2003 state Supreme Court order.
The state inadvertently shared Social Security numbers along with
the other information, according to the opinion that affirmed a
lower court's order dismissing the suit.
Shortly after the suit was filed, state legislators amended laws
governing the selling of information and the company was
reimbursed and ordered to dispose of the data, according to the
order.
The court ruled that the suit couldn't stand because there was no
proof that anyone had actually been harmed.
The court said in the order that the disclosure of Social Security
numbers was inadvertent and didn't cause harm.
As of Oct. 31, 418,000 taxpayers had signed up for credit
protection that will cost the state up to $12 million to provide,
Gov. Haley said.
Earlier this year, Temple University published a study that found
that offering credit protection prevented more lawsuits.
"Our results suggest that the odds of a firm being sued in federal
court are 3.5 times greater when individuals suffer financial
harm," the study said, "but over six times lower when the firm
provides free credit monitoring following the breach."
Also, the study determined that defendants "settle 30 percent more
often when plaintiffs allege financial loss from a data breach or
when faced with a certified class-action suit."
A judge must decide whether to certify the lawsuit filed Wednesday
as a class-action suit.
To what degree taxpayers' accepting credit protection affects
their standing to sue is unclear.
Tom Vanderbloemen, an intellectual property attorney at
Greenville's Gallivan White & Boyd law firm, said the problem for
entities whose store of information is compromised can be farther-
reaching than it once was.
The increased use of mobile devices and the advent of "cloud
computing" -- where businesses save overhead costs by operating
from remote servers -- has made legal issues more complex, he
said.
For instance, Mr. Vanderbloemen said, an organization
theoretically could store Social Security numbers or trade secrets
on a server based overseas.
Tracking down a foreign hacker involved in such a case would be
difficult, so victims of data theft could turn to the legal system
instead.
"This is not just a risk that companies face in terms of losing
data and damage to their infrastructure," he said. "There are
also possible legal risks that they face by being sued by other
people because they didn't protect the data sufficiently."
THOMAS JEFFERSON: Ex-Career Dean Admits to Padding Job Stats
------------------------------------------------------------
The National Law Journal reports that a former assistant career
services dean at the Thomas Jefferson Law School has filed a
declaration in a class action against the institution in which she
acknowledges padding graduate employment statistics after
allegedly being pressured by her supervisor to improve the
school's jobs statistics. A Thomas Jefferson graduate kicked off
a wave of litigation alleging fraud by law schools when she sued
her alma mater in 2011 on behalf of herself and other graduates.
WELLS FARGO: 11th Cir. Rejects Arbitration Bid in Overdraft Suit
----------------------------------------------------------------
Daily Business Review reports that the Eleventh Circuit has
rejected Wells Fargo & Co.'s effort to force arbitration in the
multidistrict litigation on bank overdraft fees, ruling the bank
waived its right to invoke arbitration in five class action suits
brought against it or Wachovia Corp., which Wells Fargo purchased
in 2008.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Noemi Irene
A. Adala, Joy A. Agravante, Ivy B. Magdadaro, Psyche A. Castillon,
Julie Anne L. Toledo, Christopher Patalinghug, Frauline Abangan
and Peter A. Chapman, Editors.
Copyright 2012. All rights reserved. ISSN 1525-2272.
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Information contained herein is obtained from sources believed to
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firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter Chapman
at 240/629-3300.
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