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C L A S S A C T I O N R E P O R T E R
Tuesday, June 25, 2013, Vol. 15, No. 124
Headlines
ACTAVIS INC: Still Faces Suits Over Cipro in State Courts
ACTAVIS INC: No Trial Date Yet in TCPA Breach Suits v. Anda
ACTAVIS INC: Moves to Junk Claims in Stock Suit Over Prochieve
ACTAVIS INC: Faces Suit Over Loestrin 24 Fe Patent Settlement
AIR CANADA: Bersenas Jacobsen Discusses Class Action Ruling
ATLAS AIR: Polar Air Cargo Named as Defendant in Antitrust Suit
ATLAS AIR: Continues to Face Antitrust Suits in Canada
BOULDER BRANDS: N.J. Mislabeling Suit Voluntarily Dismissed
BOULDER BRANDS: Will Move to Dismiss NY Suit Over "Fat Free Milk"
BOULDER BRANDS: Motion to Dismiss Butter Ad Lawsuit Pending
CANADA: Mountie's Lawyer Seeks Negotiation in Class Action v. RCMP
CANADA: Another Female Mountie Joins Class Action v. RCMP
CASTLE CHEESE: Recalls Okanagan's Choice Cheese-Chipped Parmesan
CHINA EDUCATION: Securities Suit Settlement Gets Final Approval
DISCOUNT INVESTMENTS: Court Approves Class Action Settlement
DYNEGY INC: Stockholder Suit Over Restructuring Continues
EL PASO PIPELINE: Fails to Dismiss "Allen" Suit Over SNG Purchase
ELECTRONIC ARTS: Consumers to Get More Under Modified Settlement
ENERGYSOLUTIONS INC: Signs MOU to Settle Merger-Related Suits
ENSTAR GROUP: Yet to File Settlement Documents in Merger Suits
FACEBOOK INC: Lawsuits, Investigations on IPO Ongoing
FBR & CO: Appeal From Thornburg Suit Dismissal Remains Pending
FBR & CO: Briefing on Appeal in Colorado Securities Suit Ongoing
FBR & CO: Definitive Agreements Forthcoming in Imperial IPO Suits
FIRST CALIFORNIA: Yet to Sign Stipulation in Merger-Related Suit
GENERAL MOTORS: GM Canada Dealers' Lawsuit Continues
GENWORTH HOLDINGS: Barlee Case v. Subsidiary Dismissed
GNC HOLDINGS: Settles Calif. Consolidated Suit Over Hydroxycut
GOLD COAST: Arundel Hills Residents Sue Over Suntown Tip Operation
GRANNA'S LLC: Recalls #705 Tuna Mac With Italian Blend Vegetables
HCA HOLDINGS: Awaits Ruling in Motion to Dismiss Tenn. Stock Suit
HERTZ CORPORATION: Class Certified in Nev. Car Rental Lawsuit
HERTZ GLOBAL: June Hearing on Accord in "Davis Landscape" Suit
IKANOS COMMUNICATIONS: Settlement in Securities Action Approved
IMPAX LABORATORIES: Securities Suits Filed in March & April
INVESTORS BANCORP: Yet to Ink Deal to Settle Merger-Related Suit
ISUZU: Recalls NPR-HD, NQR and NRR Models of Isuzu Trucks
JBI INC: Limited Discovery Has Commenced in Stockholder Suit
KKR & CO: Motion to Junk Complaint in Del. Stock Suit Pending
KKR & CO: Renews Summary Judgment Bid in Mass. Antitrust Suit
L.D. KICHLER: Recalls 48,900 Chandeliers Due to Injury Hazard
LENDER PROCESSING: Wants Cohen Milstein Removed From Class Action
LEVEL 3 COMMUNICATIONS: Awaits OK for Rights-of-Way Suit Accord
MERGE HEALTHCARE: Insurer Appeals Award of Coverage in Stock Suit
NARCONON: Parents of Former Patients File Fraud Class Action
NEOMAGNETIC GADGETS: Recalls Cube and Buckyballs Magnetic Sets
NEW YORK, NY: On-Body Recording Systems Better for Police
OGDEN CAP: Plaintiffs to Drop Renters & Owners From Class Action
PADDYWAX LLC: Recalls 2,100 Fragrance Diffusers Due to Labeling
PEOPLE'S UNITED: Awaits Approval of $7.25BB Deal in Suit vs. VISA
PEOPLE'S UNITED: Bank Renews Bid to Dismiss Overdraft Fee Suit
PEOPLE'S UNITED: Plaintiffs Amended Suit vs. Smithtown in April
PEOPLE'S UNITED: Bank Unit Still Defends Wage and Hour Suit
PERRIGO COMPANY: Cert. Hearing for Eltroxin Suit in September
PERRIGO COMPANY: Agrees to Settle "Warner" Suit for $1.787MM
SCOTT MIRACLE-GRO: Still Faces Suit Over Wild Bird Food Products
SONAE: Ordered to Insure for GBP65 Million Legal Claims
SUFFOLK BANCORP: Reaches Settlement in "Fisher" Securities Suit
SUNPOWER CORP: July Hearing for $19.7MM Securities Suit Accord
TASTY TREAT: Recalls Oskri Chocolate Bars Over Undeclared Milk
TRUNKBOW INTERNATIONAL: Faces Suits Over Executives' Stock Buy
UNIT CORPORATION: Smaller Class Proposed for Suit v. Subsidiary
VOLKSWAGEN: Sudden Deceleration Misdiagnosed, Plaintiff Says
WEBMD HEALTH: Awaits Next Move of Securities Suit Plaintiffs
WPX ENERGY: Royalty Interest Owners Sue for $20MM in Colorado
WPX ENERGY: Suit by N.M., Colo. Royalty Owners Continues
WPX ENERGY: Faces Claims by N.M., Col. Mineral Interest Owners
WPX ENERGY: Accused of Violating Wyoming Royalty Payment Act
WPX ENERGY: Continues to Face Suit by Natural Gas Purchasers
WPX ENERGY: Plaintiffs in Nev. Lawsuit Pursue Certification
XL GROUP: Tag-Along Antitrust Lawsuits Now Dismissed
YONGYE INTERNATIONAL: Class Suits Over Wu Proposal Consolidated
* New Bill Gives Businesses Chance to Escape Class Actions
* Rise in Consumer Class Actions Spark Debate in California
* U.S. Equal Employment Opportunity Commission Files GINA Suit
*********
ACTAVIS INC: Still Faces Suits Over Cipro in State Courts
---------------------------------------------------------
Actions remain pending against Actavis, Inc. in various state
courts, including California, Kansas, Tennessee, and Florida over
its alleged unlawful, anticompetitive conduct in connection with
alleged agreements related to the development, manufacture and
sale of the drug substance ciprofloxacin hydrochloride, according
to the company's May 7, 2013, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2013.
Beginning in July 2000, a number of suits were filed against the
Company, The Rugby Group, Inc. ("Rugby") and other company
affiliates in various state and federal courts alleging claims
under various federal and state competition and consumer
protection laws.
Several plaintiffs have filed amended complaints and motions
seeking class certification. Approximately 42 were cases filed
against the Company, Rugby and other Company entities. Many of
these actions have been dismissed. Actions remain pending in
various state courts, including California, Kansas, Tennessee, and
Florida.
The actions generally allege that the defendants engaged in
unlawful, anticompetitive conduct in connection with alleged
agreements, entered into prior to the Company's acquisition of
Rugby from Sanofi Aventis ("Sanofi"), related to the development,
manufacture and sale of the drug substance ciprofloxacin
hydrochloride, the generic version of Bayer's brand drug, Cipro.
The actions generally seek declaratory judgment, damages,
injunctive relief, restitution and other relief on behalf of
certain purported classes of individuals and other entities. In
the action pending in Kansas, the court has administratively
terminated the matter. There has been no action in the cases
pending in Florida and Tennessee since 2003.
In the action pending in the California Superior Court for the
County of San Diego ( In re: Cipro Cases I & II, JCCP Proceeding
Nos. 4154 & 4220 ), on July 21, 2004, the California Court of
Appeal ruled that the majority of the plaintiffs would be
permitted to pursue their claims as a class. On August 31, 2009,
the California Superior Court granted defendants' motion for
summary judgment, and final judgment was entered on September 24,
2009. On October 31, 2011, the California Court of Appeal affirmed
the Superior Court's judgment. On December 13, 2011, the
plaintiffs filed a petition for review in the California Supreme
Court.
On February 15, 2012, the California Supreme Court granted review.
On September 12, 2012, the California Supreme Court entered a stay
of all proceedings in the case pending possible action by the
United States Supreme Court in an unrelated case that raises
similar legal issues.
In addition to the pending actions, the Company understands that
various state and federal agencies are investigating the
allegations made in these actions. Sanofi has agreed to defend and
indemnify the Company and its affiliates in connection with the
claims and investigations arising from the conduct and agreements
allegedly undertaken by Rugby and its affiliates prior to the
Company's acquisition of Rugby, and is currently controlling the
defense of these actions.
ACTAVIS INC: No Trial Date Yet in TCPA Breach Suits v. Anda
-----------------------------------------------------------
No trial date yet has been set in lawsuits alleging violations of
the Telephone Consumer Protection Act (TCPA) against Anda, Inc., a
subsidiary of Actavis, Inc., according to the company's May 7,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
In January 2008, Medical West Ballas Pharmacy, LTD, filed a
putative class action complaint against the Company alleging
conversion and alleged violations of the TCPA and Missouri
Consumer Fraud and Deceptive Business Practices Act. In April
2008, plaintiff filed an amended complaint substituting Anda,
Inc., a subsidiary of the Company, as the defendant.
The suit is Medical West Ballas Pharmacy, LTD, et al. v. Anda,
Inc., (Circuit Court of the County of St. Louis, State of
Missouri, Case No. 08SL-CC00257).
The amended complaint alleges that by sending unsolicited
facsimile advertisements, Anda misappropriated the class members'
paper, toner, ink and employee time when they received the alleged
unsolicited faxes, and that the alleged unsolicited facsimile
advertisements were sent to the plaintiff in violation of the TCPA
and Missouri Consumer Fraud and Deceptive Business Practices Act.
The TCPA allows recovery of minimum statutory damages of $500 per
violation, which can be trebled if the violations are found to be
willful. The complaint seeks to assert class action claims on
behalf of the plaintiff and other similarly situated third
parties. In April 2008, Anda filed an answer to the amended
complaint, denying the allegations.
In November 2009, the court granted plaintiff's motion to expand
the proposed class of plaintiffs from individuals for which Anda
lacked evidence of express permission or an established business
relationship to "All persons who on or after four years prior to
the filing of this action, were sent telephone facsimile messages
advertising pharmaceutical drugs and products by or on behalf of
Defendant."
In November 2010, the plaintiff filed a second amended complaint
further expanding the definition and scope of the proposed class
of plaintiffs. On December 2, 2010, Anda filed a motion to dismiss
claims the plaintiff is seeking to assert on behalf of putative
class members who expressly consented or agreed to receive faxes
from Defendant, or in the alternative, to stay the court
proceedings pending resolution of Anda's petition to the FCC
(discussed below).
On April 11, 2011, the court denied the motion. On May 19, 2011,
the plaintiff's filed their motion seeking certification of a
class of entities with Missouri telephone numbers who were sent
Anda faxes for the period January 2004 through January 2008. The
motion has been briefed and was scheduled for hearing on May 15,
2013. No trial date has been set in the matter.
On May 1, 2012, an additional action under the TCPA was filed by
Physicians Healthsource, Inc., purportedly on behalf of the "end
users of the fax numbers in the United States but outside Missouri
to which faxes advertising pharmaceutical products for sale by
Anda were sent." (Physicians Healthsource Inc. v. Anda Inc. United
States District Court for the Southern District of Florida, 12 CV
60798). On July 10, 2012, Anda filed its answer and affirmative
defenses. The matter is in its preliminary stages and no trial
date has been set.
Several issues raised in plaintiff's motion for class
certification in the Medical West matter are currently under
consideration in the Eighth Circuit Court of Appeals in an
unrelated case to which Anda is not a party, Nack v. Walburg, No.
11-1460. Nack concerns whether there is a private right of action
for failing to include any opt-out notice on faxes sent with
express permission, contrary to a Federal Communications
Commission (FCC) Regulation that requires such notice on fax
advertisements. The Eighth Circuit granted Anda leave to file an
amicus brief and to participate during oral argument in the
matter, which was held on September 19, 2012. No decision has been
issued to date.
In a related matter, on November 30, 2010, Anda filed a petition
with the FCC, asking the FCC to clarify the statutory basis for
its regulation requiring "opt-out" language on faxes sent with
express permission of the recipient (the "FCC Petition"). On May
2, 2012, the Consumer & Governmental Affairs Bureau of the FCC
dismissed the FCC Petition. On May 14, 2012, Anda filed an
application for review of the Bureau's dismissal by the full
Commission, requesting the FCC to vacate the dismissal and grant
the relief sought in the FCC Petition. The FCC has not ruled on
the application for review.
Anda believes it has substantial meritorious defenses to the
putative class actions brought under the TCPA, including but not
limited to its receipt of consent to receive facsimile
advertisements from many of the putative class members, and
intends to defend the actions vigorously. However, these actions,
if successful, could have a material adverse effect on the
Company's business, results of operations, financial condition and
cash flows.
ACTAVIS INC: Moves to Junk Claims in Stock Suit Over Prochieve
--------------------------------------------------------------
A motion to dismiss all claims in an amended complaint filed in a
securities suit against Actavis, Inc. in relation to disclosures
regarding approval of Prochieve progesterone gel, remains pending,
according to the company's May 7, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On June 8, 2012, the Company and certain of its officers were
named as defendants in a consolidated amended class action
complaint filed in the United States District Court for the
District of New Jersey (In re: Columbia Laboratories, Inc.
Securities Litigation, Case No. CV 12-614) by a putative class of
Columbia Laboratories' stock purchasers.
The amended complaint generally alleges that between December 6,
2010 and January 20, 2012, Actavis and certain of its officers, as
well as Columbia Laboratories and certain of its officers, made
false and misleading statements regarding the likelihood of
Columbia Laboratories obtaining FDA approval of Prochieve
progesterone gel, Columbia Laboratories' developmental drug for
prevention of preterm birth. Actavis licensed the rights to
Prochieve from Columbia Laboratories in July 2010.
The amended complaint further alleges that the defendants failed
to disclose material information concerning the statistical
analysis of the clinical studies performed by Columbia
Laboratories in connection with its pursuit of FDA approval of
Prochieve.
The complaint seeks unspecified damages. On August 14, 2012, the
defendants filed a motion to dismiss all of the claims in the
amended complaint. The motion to dismiss remains pending.
ACTAVIS INC: Faces Suit Over Loestrin 24 Fe Patent Settlement
-------------------------------------------------------------
Actavis, Inc. is facing lawsuits alleging its 2009 patent lawsuit
settlement with Warner Chilcott related to Loestrin 24 Fe is
unlawful, according to the company's May 7, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2013.
On April 5, 2013, two putative class actions were filed in the
federal district court (New York Hotel Trades Council & Hotel
Assoc. of New York City, Inc. Health Benefits Fund v. Warner
Chilcott Pub. Ltd. Co., et al., D.N.J., Civ. No. 13-02178, and
United Food and Commercial Workers Local 1776 & Participating
Employers Health and Welfare Fund v. Warner Chilcott (US), LLC, et
al., E.D.Pa., No. 13-01807) alleging the Company's 2009 patent
lawsuit settlement with Warner Chilcott related to Loestrin 24 Fe
(norethindrone acetate/ethinyl estradiol tablets and ferrous
fumarate tablets, "Loestrin 24") is unlawful.
The complaints, both asserted on behalf of putative classes of
end-payors, generally allege that the Company and another generic
manufacturer improperly delayed launching generic versions of
Loestrin 24 in exchange for substantial payments from Warner
Chilcott, in violation of federal and state antitrust and consumer
protection laws. The complaints each seek declaratory and
injunctive relief and damages.
On April 15, 2013, the plaintiff in New York Hotel Trades withdrew
its complaint and, on April 16, 2013, refiled it in the federal
court for the Eastern District of Pennsylvania (New York Hotel
Trades Council & Hotel Assoc. of New York City, Inc. Health
Benefits Fund v. Warner Chilcott Public Ltd. Co., et al., E.D.Pa.,
Civ. No. 13-02000).
Also on April 16, 2013, two additional complaints were filed by
different plaintiffs seeking to represent the same putative class
of end-payors (A.F. of L. ? A.G.C. Building Trades Welfare Plan v.
Warner Chilcott, et al., D.N.J. 13-02456) and (Fraternal Order of
Police, Fort Lauderdale Lodge 31, Insurance Trust Fund v. Warner
Chilcott Public Ltd. Co., et al., E.D.Pa. Civ. No. 13-02014).
These cases are still in their early stages and discovery has not
yet begun on either the class allegations or merits. The Company
anticipates additional claims or lawsuits based on the same or
similar allegations.
AIR CANADA: Bersenas Jacobsen Discusses Class Action Ruling
-----------------------------------------------------------
Carlos Martins P. Martins -- cmartins@lexcanada.com -- at Bersenas
Jacobsen Chouest Thomson Blackburn LLP reports that in early 2012
the Supreme Court of British Columbia ruled in Unlu v Air Canada.
Its decision was recently upheld by the British Columbia Court of
Appeal (2013 BCCA 112).
Background
The case related to the practice of several air carriers of
identifying the fuel surcharge levied on their tickets in a manner
that may cause passengers to believe that these charges are taxes
collected by a third party, when in fact fuel surcharges are
collected by the airline for its own benefit.
In the case at hand, the plaintiffs complained about two flights
between Vancouver and Germany where the fuel surcharges in
question were identified under the code "YQ" on electronic tickets
under the heading "Tax". In the case of Lufthansa, the amount of
the fuel surcharge was shown on its own. In the case of Air
Canada, it was commingled with three other charges under the
heading "Tax".
The plaintiffs alleged that this practice contravened the
provincial Business Practices and Consumer Protection Act (SBC
2004 c2), which provides that suppliers shall not engage in a
"deceptive act or practice". A 'deceptive act or practice'
includes making a representation or engaging in conduct "that has
the capability, tendency or effect of deceiving or misleading a
consumer".
As a principle of Canadian constitutional law, matters relating to
aeronautics fall under the jurisdiction of the federal government.
The doctrine of paramountcy has developed to address situations
where provincial legislatures pass laws whose operational effects
are incompatible with federal legislation. Where this occurs in
cases relating to aeronautics (as well as other subject matter
that is the domain of the federal government), the doctrine of
federal paramountcy arises, giving effect to the federal act over
its provincial counterpart:
"The plaintiff's claims against the appellant airlines are made
under s. 5 of the Provincial Act, which prohibits deceptive acts
and practices in respect of consumer transactions. It is the
intention of the plaintiff to apply to have the action certified
as a class proceeding under the Class Proceedings Act, R.S.B.C.
1996, c. 50."
In this case, Air Canada and Lufthansa challenged the
applicability of the provincial act over their operations in a
summary trial in a lower court because, they argued, rates and
fees associated with international air travel are governed by
Section 110 of the Air Transportation Regulations (SOR/88-58),
enacted pursuant to Section 86 of the federal Canada
Transportation Act (SC 1996, c10).
More specifically, Section 110 of the regulations requires an air
carrier operating an international service to file a tariff with
the Canadian Transportation Agency (CTA). Section 122 of the
regulations mandates the information that must be contained in the
tariff, including the fare rates and charges that may be charged
by the airline.
Decision
When beginning its analysis, the court emphasized that the
plaintiffs were not alleging that the air carriers had no right to
levy a fuel surcharge or that the amount of the surcharge was
unreasonable. They also raised no issue with regard to the
wording of the tariffs filed by the air carriers. The only issue
to be decided was whether the provincial act had any place in the
dispute.
The court set out the test from Quebec (Attorney General) v
Canadian Owners and Pilots Association (2010 SCC 39), which
provides that the doctrine of federal paramountcy is engaged
(thereby rendering a provincial enactment inoperative) when:
-- there is an operational conflict between federal and
provincial laws; or
-- a provincial law is incompatible with the purpose of the
federal legislation.
On the issue of operational conflict, the appellate court upheld
the lower court's ruling that there was none. The appellate court
found that in order for the operational conflict to be found, the
provincial act would have to prohibit a deceptive statement (which
it does) and the federal act would have to require a deceptive
statement (which it unsurprisingly does not).
Nevertheless, the air carriers argued that they were required to
follow the terms of their tariff, which required them to identify
the fuel charges in the way that they appeared on the tickets in
question.
The appellate court was unimpressed by this argument and held
that:
"[t]he fallacy in the [air carriers'] argument is that neither the
federal legislation nor the tariff requires the appellants to show
the fuel surcharge as a tax on the ticket . . . The [air carriers]
are not correct in their assertion that the federal legislation
says 'yes you must', because the legislation does not require the
surcharge to be shown as tax."
In making its decision on this point, the court noted that since
the case had commenced, new advertising regulations had been
implemented under the federal act which prohibited the use of the
word 'tax' to describe an air transportation charge. The court
made three points with regard to the amended federal advertising
regulations:
-- They did not apply to this instance as they related to
advertising, and not to the information identified on an already
purchased ticket;
-- The new federal regulations were not inconsistent with the
provincial act; and
-- There was no operational conflict between the new
advertising regulations and the provincial act.
The court went on to deal with the issue of whether the provincial
act "frustrated the federal purpose". Again, the appellate court
accepted the finding of the lower court that it did not.
The air carriers argued that the federal act and the Air
Transportation Regulations were a complete code for the regulation
of all matters related to air travel, including airline tariffs
and tickets, and that the CTA is intended to be the final decision
maker in respect of these matters. The air carriers further
argued that the purpose of the federal act would be frustrated if
the provincial legislatures were permitted to intrude on the CTA's
domain.
In support of their argument, the airlines referenced Section
18(b) of the regulations, which prohibits licensee air carriers
from making misleading public statements with respect to their air
services. The air carriers argued that this demonstrated that the
CTA had already been granted authority to deal with
misrepresentation as a result of this provision.
The appellate court rejected this argument, holding that the
plaintiffs' allegations against the air carriers related not to
"publicly made" statements, but rather to representations printed
on purchased tickets:
"section 5 of the Provincial Act, which protects consumers against
deceptive acts and practices, is entirely compatible with the
federal legislation and, in particular within the context of the
plaintiffs' claims, s. 5 is compatible with s. 135.91 of the [Air
Transportation Regulations], which prohibits the use of the term
"tax" in an advertisement to describe an air transportation charge
of an airline."
The court similarly rejected the air carriers' argument that the
CTA had jurisdiction to deal with the issue of the YQ surcharges
because, under Section 113.1 of the Air Transportation
Regulations, it can order an airline to pay compensation for
losses suffered by a passenger when an air carrier fails to apply
its tariffs. The court found that this case was not about the
application of tariffs -- rather, it was about the way in which
surcharges were represented on tickets issued by the air carriers.
The court also found that because the issue in the matter at hand
was not the "reasonableness of the surcharges", Section 111 of the
regulations also had no application. (This section of the
regulations allows individuals to challenge tariffs that they
believe are not "just and reasonable").
On the issue of "frustrating the federal purpose", the court
referenced the regulatory impact statement that was prepared when
the above-referenced advertising regulations came into force. In
that document, the drafters specifically indicated that:
"[t]he advertising of products and services is subject to consumer
protection of general application . . . at the provincial level
through provincial legislation . . . It is the advertisers'
responsibility to ensure that they comply with all applicable
legislation respecting advertising, not just the [Air
Transportation Regulations]."
Finally, the court had to determine whether the doctrine of inter-
jurisdictional immunity applied to this case. This doctrine
protects the core of a federal power from provincial legislation
where the provincial legislation in question encroaches on the
core of a federal power and such transgression is serious enough
to prevent the provincial enactment from being applied. The
appellate court agreed with the lower court's finding that even if
carrying passengers by air was part of the core of the federal
jurisdiction over aeronautics, the seriousness of the impairment
of that core by the provincial act was not sufficient to attract
the doctrine of inter-jurisdictional immunity.
In this regard, the appellate court noted that the protection
afforded to the public against deceptive practices was entirely
consistent with, for example, the new advertising regulations,
which also prohibit the use of the word 'tax' to described an air
transportation charge imposed by an airline.
The court found in favor of the plaintiffs and permitted the
complaint with respect to Section 172 of the provincial act to
proceed. The plaintiffs were awarded the costs of the appeal.
ATLAS AIR: Polar Air Cargo Named as Defendant in Antitrust Suit
---------------------------------------------------------------
The U.S. District Court for the Eastern District of New York on
April 13 allowed plaintiffs in an antitrust suit to add Polar Air
Cargo Worldwide, Inc., as additional defendant, according to Atlas
Air Worldwide Holdings, Inc.'s May 2, 2013, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
In 2010, Polar Air Cargo LLC (Old Polar) entered into a plea
agreement with the United States Department of Justice relating to
the previously disclosed DOJ investigation concerning alleged
manipulation by cargo carriers of fuel surcharges and other rate
components for air cargo services.
As a result of the DOJ Investigation, the Company and Old Polar
have been named defendants, along with a number of other cargo
carriers, in several class actions in the United States arising
from allegations about the pricing practices of a number of air
cargo carriers that have now been consolidated for pre-trial
purposes in the United States District Court for the Eastern
District of New York. The consolidated complaint alleges, among
other things, that the defendants, including the Company and Old
Polar, manipulated the market price for air cargo services sold
domestically and abroad through the use of surcharges, in
violation of United States, state, and European Union antitrust
laws. The suit seeks treble damages and injunctive relief.
In 2007, the Company and Old Polar commenced an adversary
proceeding in bankruptcy court against each of the plaintiffs in
this class action litigation seeking to enjoin the plaintiffs from
prosecuting claims against the Company and Old Polar that arose
prior to 2004, the date on which the Company and Old Polar emerged
from bankruptcy. In 2007, the plaintiffs consented to the
injunctive relief requested and the bankruptcy court entered an
order enjoining plaintiffs from prosecuting Company claims arising
prior to 2004.
The court in the antitrust class actions has heard and decided a
number of procedural motions. Among those was the plaintiffs'
motion to join Polar Air Cargo Worldwide, Inc. as an additional
defendant, which the court granted on April 13, 2011. There was
substantial pre-trial written discovery and document production,
and a number of depositions were taken. The case is currently in
the class certification phase, with motions and responses being
submitted and additional depositions occurring. We are unable to
reasonably predict the court's ruling on the motion or the
ultimate outcome of the litigation.
ATLAS AIR: Continues to Face Antitrust Suits in Canada
------------------------------------------------------
Atlas Air Worldwide Holdings, Inc., Polar Air Cargo LLC (Old
Polar) and a number of other cargo carriers have been named as
defendants in civil class action suits in the provinces of British
Columbia, Ontario and Quebec, Canada that are substantially
similar to the class action suits in the United States. The
plaintiffs in the British Columbia case have indicated they do not
intend to pursue their lawsuit against the Company and Old Polar.
Atlas Air is unable to reasonably predict the outcome of the
litigation in Ontario and Quebec, according to the Company's May
2, 2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
BOULDER BRANDS: N.J. Mislabeling Suit Voluntarily Dismissed
-----------------------------------------------------------
Plaintiffs in a suit over alleged mislabeling of Boulder Brands,
Inc.'s Smart Balance "Fat Free Milk and Omega-3s" products
voluntarily dismissed their claims, according to the Company's May
2, 2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
In October 2011, a class action lawsuit was filed against Boulder
Brands in the U.S. District Court for the District of New Jersey
alleging that the labeling and marketing of the Company's Smart
Balance "Fat Free Milk and Omega-3s" products are unfair,
deceptive, and improper because they contain 1g of fat from the
Omega-3 fatty acid oil blend in the products. That lawsuit was
voluntarily dismissed by the plaintiffs on February 22, 2013, and
it is now fully and finally concluded.
BOULDER BRANDS: Will Move to Dismiss NY Suit Over "Fat Free Milk"
-----------------------------------------------------------------
Boulder Brands, Inc. plans to move to dismiss a lawsuit filed in
the U.S. District Court for the Southern District of New York over
alleged misleading marketing of "Fat Free Milk," according to the
Company's May 2, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2013.
On February 21, 2013, a class action lawsuit relating to the
labeling of Smart Balance Fat Free Milk products was filed in the
U.S. District Court for the Southern District of New York, or the
"Southern District," alleging the label and marketing was
misleading because, although the labels says "Fat Free Milk" the
product contains 1g of fat from the Omega-3 fatty acid oil blend
in the products.
The Company will move to dismiss the lawsuit and intends to
vigorously defend itself against these allegations. The Company
does not expect that the resolution of this matter will have a
material adverse effect on its business.
BOULDER BRANDS: Motion to Dismiss Butter Ad Lawsuit Pending
-----------------------------------------------------------
The motion of Boulder Brands, Inc. to dismiss a complaint over
labeling and marketing of Smart Balance Butter & Canola Oil Blend
products remains pending, according to the Company's May 2, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013. A substantially similar
class action lawsuit was stayed pending a decision in the
California Case.
The company disclosed in the 10-Q filing: "On July 28, 2012, a
class action lawsuit was filed in the U.S. District Court for the
Southern District of California claiming that the labeling and
marketing of Smart Balance Butter & Canola Oil Blend products is
false, misleading and deceptive (the "California Case")."
"On September 18, 2012, we moved to dismiss the complaint. That
motion remains pending. A substantially similar class action
lawsuit related to the labeling and marketing of Smart Balance
Butter & Canola Oil Blend products was filed on August 9, 2012 in
the Southern District. In light of its similarity to the
California Case, the Southern District stayed all activity in the
case pending a decision in the California Case.
"We believe the allegations contained in both of these complaints
are without merit and we intend to vigorously defend ourselves
against these allegations. We do not expect that the resolution of
this matter will have a material adverse effect on our business."
CANADA: Mountie's Lawyer Seeks Negotiation in Class Action v. RCMP
------------------------------------------------------------------
James Keller, writing for The Canadian Press, reports that the
lawyer representing a former female Mountie who filed a class-
action lawsuit over allegations of widespread harassment within
the Royal Canadian Mountain Police says the federal government
should attempt to negotiate an end to its legal troubles rather
than force the case to drag out through the courts.
David Klein -- whose client, Janet Merlo, filed her lawsuit last
year -- was in court for a procedural hearing on June 4, a day
after the commissioner of the RCMP complained the force was being
targeted by "outlandish claims."
On June 3, Commissioner Bob Paulson told a Senate committee the
force was being tarnished by unproven claims that are nonetheless
"put forward as though they are gospel."
Commissioner Paulson singled out three alleged cases of abuse --
two put forward by men, one by a woman -- as he suggested some
officers were spending more time complaining than working to make
things better. Ms. Merlo's case was not among them.
"We're surprised, we're very surprised," Mr. Klein said outside
court on June 4. "When you take a look at the RCMP's action plan
[for addressing harassment], they clearly say they want to sit
down and settle these cases. My clients have said, 'Yes,
absolutely, sit down with us.' So far, we've just gotten a flat-
out 'no.'"
The proposed class-action case was launched by Ms. Merlo in March,
2012, more than two years after she left the force.
Ms. Merlo alleged her 19-year career was overshadowed by years of
name-calling, sexist pranks and requests for sexual favors, and
she asked that her case be certified as a class action. The
allegations have not been proven in court.
When the case was initially filed, Mr. Klein suggested more than
100 current and former officers had indicated they wanted to join
the case. On June 4, he said the number was now almost 300 --
about one-third of which are still active members of the force.
The case has yet to be certified as a class-action lawsuit.
Ms. Merlo's lawyer wants a certification hearing in December,
while a federal government asked a judge on June 4 to delay such a
hearing until April or May of next year.
Complicating the timing is a motion from the federal government to
strike down several sections of Ms. Merlo's original statement of
claim.
Those sections largely focus on technical legal points, such as
whether RCMP officers have an explicit contract of employment with
the federal government that includes a duty to protect them from
harassment.
The federal government wants the court to hear its arguments next
month, but Mr. Klein argued in court the government's motion to
strike portions of Ms. Merlo's lawsuit should be heard at the same
time as the class-action certification.
The judge did not rule on either the timing of the government's
motion or the certification hearing, or whether they will be held
together.
Inside court, Mitchell Taylor, a lawyer for the federal
government, said it would be "premature" to consider mediation at
this stage.
Among the people in the public gallery for the June 4 hearing was
Mary Kostashuk, a former RCMP sergeant who has approached Mr.
Klein about joining the class-action case.
Ms. Kostashuk retired in April after a career that spanned more
than three decades, mostly in the Vancouver area. Before she
retired, she worked in commercial crime and market enforcement.
Ms. Kostashuk said she experienced years of name-calling and
bullying in what she described as a "toxic" workplace, but she
said when she attempted to complain in 2009, she was told it was
her that was the problem.
However, she hesitated when asked whether she believed her alleged
treatment was related to her gender.
"I was called names, I was left out of certain projects," she said
outside court, standing next to Mr. Klein.
"I felt that it was about supervisors' lack of abilities to
supervise. For me, it's hard to tell [whether it was gender-
based], because I was naive and people have to tell me to give my
head a shake and say, 'The things that happened to you were
because you were female.'"
Ms. Merlo is among several female Mounties who have filed lawsuits
in recent years, the most high-profile of which is Catherine
Galliford, a former RCMP spokeswoman who has become the face of
the mountain of claims of harassment within the force.
Argument
CTV News reports that lawyers were in a B.C. courtroom on June 4
to argue that a lawsuit filed by a female RCMP officer should be
declared a class-action and go before a judge.
The suit, brought forward by RCMP veteran Janet Merlo, alleges
that she and other female members faced gender-based
discrimination and the force failed to do anything about it. The
women allege they were bullied and harassed on the job.
None of the allegations have been proven in court.
Ms. Merlo's lawsuit is just one of a number that the RCMP is
facing that allege harassment or sexual abuse within the force.
Cpl. Catherine Galliford, a former RCMP spokesperson in Vancouver
who was a very public face of the force during the Air India and
Robert Pickton cases, filed a lawsuit last year alleging she was
subject to years of abuse. Const. Karen Katz has filed two
lawsuits: one in which she alleges she was harassed and sexually
assaulted by a colleague, and another in which she alleges abuse
that spanned her career.
The RCMP has issued denials in several of the cases.
An internal report released last year found that gender-based
harassment was common among female officers who participated in
the study. The Commission for Public Complaints Against the RCMP
made several recommendations for changing the way the force
handles internal grievances about harassment, including making the
process more independent, imposing strict timelines for dealing
with allegations, and relevant training for all members of the
force.
In response to that report, Deputy Commissioner Craig Callens
announced that the Mounties would establish an investigative team
devoted solely to harassment complaints.
On June 4, RCMP Commissioner Bob Paulson told a Senate committee
probing harassment and bullying that the force is making several
changes in order to address and eradicate abuse of all kinds.
"The vast majority of my members and employees are out there every
day, every night, all the time, busting their humps at delivering
a safe Canada for Canadians because they love the work and they
love this country," Mr. Paulson said.
"These are the people I'm beholden to. And these are the people
that deserve a respectful, supportive and enabling workplace."
At the committee hearing, Mr. Paulson did, however, criticize some
members who have gone public with their allegations.
"We are progressing, honorable senators, believe me. But like any
workforce or workplace, we have people who, for one reason or
another, will not get on board with the mission of the
organization and are looking for easy street," Mr. Paulson said.
"I can't be continually defending against outlandish claims that
have not been tested or established, but yet are being put forward
as though they are gospel and representative of the modern
workplace experience of the RCMP, because they are not."
CANADA: Another Female Mountie Joins Class Action v. RCMP
---------------------------------------------------------
Keith Fraser, writing for The Province, reports that another
female Mountie comes forward about alleged harassment as hearings
on class action suit begin.
Retired RCMP Sgt. Mary Kostashuk talks with the media on June 4
after attending B.C. Supreme Court in Vancouver for a hearing
regarding the class action lawsuit against the RCMP for alleged
sexual harassment.
A recently-retired RCMP officer on June 4 added her name to the
growing list of Mounties alleging harassment and bullying in the
workplace.
Mary Kostachuk, who retired as a sergeant in April, showed up at
B.C. Supreme Court in Vancouver to lend her support to a class
action lawsuit that's been filed by former and current female
Mounties.
She said outside court she came forward because she wanted to help
the employees she left behind who were being harassed.
Kostashuk, 53, who joined the RCMP in 1981 and most recently
worked at E-Division in Vancouver, said "historically" she'd been
called certain things and had been left out of certain projects.
She seemed reluctant to describe the names she was called but did
say they were "chauvanist in nature" and that some male members
called her "split a . ."
"One day I heard them, so I just walked in and introduced myself
as split a . . and that was the end of that."
Complaints to RCMP senior management did not result in
investigations being opened, she told reporters.
"They did what they call a managerial review of my unit I was in.
Their results were that there was a problem and the problem was
me."
She said she was "blindsided" by the lack of understanding and in
2009 ended up suffering clinical depression and was off work for
several months.
"I wasn't prepared to go back to the unit that perpetuated this so
I ended up with another unit for the last three years."
She described the work environment as being "toxic" at times and
added that when she stepped forward to complain, she was usually
alone and "everybody else doesn't want to be identified and I
don't blame them."
"That was the one constant throughout my career: There was a lack
of respect by some people in management."
She said one of her problems was that she was "naive enough" to
think that men and women were equal.
"Not just in the RCMP, but even when I went to university. My dad
and brothers didn't tell me there was a difference between men and
women.
"So I was naive about all these situations I ran into when I
started my work life."
Paradoxically, she says she still loved her job and when she left
in April, her original plan was to retire after 33 years of
service.
"I wanted to leave happy and feeling like I accomplished something
in my career. I thought if I stuck around I may just become an
angry person."
Her motivation was to help people on the inside, still working for
the Mounties, she said.
"All I want is to see changes, so it'll be easier for anybody in
the RCMP to work," she said.
"I looked forward to coming to work until 2009. Now I think some
people don't look forward to coming to work. That's really sad."
People who are accountable should step forward and apologize, she
said.
"Like victims of crime, even though I'm not saying I'm like a
victim of crime myself, if you get an apology from the
perpetrators, that goes a long way. If you have a group of
individuals who don't see they're doing anything wrong, that's a
problem."
At the court hearing, a lawyer for the federal government argued
that a motion to throw out certain portions of the class action
suit should go ahead in July.
Mitchell Taylor told B.C. Supreme Court Madam Justice Miriam
Gropper that it would be more efficient to have the matter dealt
with prior to the certification hearing scheduled for December.
But David Klein, a lawyer for the representative plaintiff Janet
Merlo, told the judge that she should not hear the application at
this time.
Outside court, he told reporters the application would just result
in lengthy delays.
"The government seems more interested in litigating this case than
sitting down with our clients and talk about settling it," he
said.
"[T]hey were trying to delay the certification, essentially delay
the ability of these women to group together and move forward to
pursue all of their claims."
Though it was normal for a defendant in a class action to seek to
have the case thrown out in advance, Mr. Klein said he was
rebuffed by a proposal to have the parties sit down with a
mediator.
About 300 female RCMP officers -- 1/3 still with the force -- have
come forward to add their names to the class action suit, said
Klein.
The judge reserved her ruling.
CASTLE CHEESE: Recalls Okanagan's Choice Cheese-Chipped Parmesan
----------------------------------------------------------------
Starting date: June 20, 2013
Type of communication: Recall
Alert sub-type: Health Hazard Alert
Subcategory: Microbiological - Listeria
Hazard classification: Class 1
Source of recall: Canadian Food Inspection Agency
Recalling firm: Castle Cheese (West) Inc.
Distribution: British Columbia, Manitoba
Extent of the product
distribution: Retail
The Canadian Food Inspection Agency (CFIA) and Castle Cheese
(West) Inc., are warning the public not to consume the Okanagan's
Choice Cheese brand Chipped Parmesan Cheese because it may be
contaminated with Listeria monocytogenes. Picture of the recalled
products' label is available at: http://is.gd/j08Srg
This product was sold from the following retail locations in
British Columbia and Manitoba:
(1) New Apple Farm Market Ltd., 2856 West Broadway,
Vancouver, BC
(2) Food Fare #1, 905 Portage Ave., Winnipeg, MB
There have been no reported illnesses associated with the
consumption of this product.
The manufacturer, Castle Cheese (West) Inc., Lumby, BC, is
voluntarily recalling the affected product from the marketplace.
The CFIA is monitoring the effectiveness of the recall.
Affected products:
Brand name Common name Size UPC
---------- ----------- ---- ---
Okanagan's Choice Chipped Parmesan 175 g 0 59756 07314 1
Cheese Cheese
Additional Info: Best Before 14 JN 11
CHINA EDUCATION: Securities Suit Settlement Gets Final Approval
---------------------------------------------------------------
The U.S. District Court for the Central District of California
entered an order granting final approval to the settlement of a
securities suit filed against China Education Alliance, Inc.,
according to the Company's May 2, 2013, Form 8-K filing with the
U.S. Securities and Exchange Commission
China Education Alliance, Inc. was previously named as a defendant
in two putative class action lawsuits filed in the U.S. District
Court for the Central District of California.
The first action, Apicella v. China Education Alliance, Inc., et
al., No. 10-cv-09239 (CAS)(JCx), was filed on December 2, 2010;
the second action, Clemens v. China Education Alliance, Inc., et
al., No. 10-cv-09987 (JFW) (AGRx), was filed on December 28, 2010.
On March 2, 2011, the two actions were consolidated as In re China
Education Alliance, Inc. Securities Litigation, No. 10-cv-09239
(CAS) (JCx) (C.D. Cal.).
The plaintiffs alleged that the Company and certain of its past
and present officers and directors were liable under Section 10(b)
of the Securities Exchange Act of 1934 and SEC Rule 10b-5 for
allegedly false and misleading statements and omissions in the
Company's public filings between 2008 and 2010 and in an investor
conference call in December 2010.
The plaintiffs also asserted claims under Section 20(a) of the
Securities Exchange Act of 1934 against the individual defendants
as persons who allegedly controlled the Company during the time
the allegedly false and misleading statements and omissions were
made.
The Company and the individual defendants denied these
allegations. The Court denied the Company's motion to dismiss the
consolidated complaint on October 11, 2011, but subsequently
dismissed one of the company's directors.
The parties agreed to settle the consolidated class action
lawsuit, and the Court entered an order granting final approval to
the parties' settlement agreement on March 13, 2013. The
settlement became final and effective following the payment by the
Company's insurance carrier on April 22, 2013, which was the final
condition of the settlement.
On May 1, 2013, the Company issued a press release announcing the
settlement of all its securities lawsuits.
DISCOUNT INVESTMENTS: Court Approves Class Action Settlement
------------------------------------------------------------
Koor Industries Ltd. on June 5 disclosed that further to its prior
immediate reports on July 25, 2012 and October 17, 2012, in
connection with a claim and an application for its certification
as a class action against the Company's parent, Discount
Investments Ltd. and against the Board of Directors and CEO of the
Company, that were filed in court in March 2009 with reference to
a rights issue by the Company in November 2008, that on June 4,
2013 the Jerusalem District Court allowed a settlement arrangement
in the Legal Proceedings in accordance with an outline recently
filed in the court, which was included in a settlement outline in
the Legal Proceedings approved by the general meeting of the
shareholders of DIC in April 2013. The main points of the
approved settlement outline include these:
-- The Legal proceedings against the directors and the CEO of the
Company are dismissed.
-- DIC will make four equal annual payments of NIS4.5 million
each, commencing August 2013, as compensation to a group
comprising shareholders of the Company (excluding controlling
shareholders in DIC) who did not exercise rights they received
from the Company to purchase shares as part of the aforementioned
issue, and each of the companies of the group will receive a
proportionate part of the amount of the compensation at the ratio
of the rights it received and did not exercise (provided that
there is no legal impediment to their exercise) to the total of
unexercised rights; the applicant's counsel in the Legal
Proceedings is appointed trustee for execution of the settlement
arrangement, and in that framework will manage the compensation
funds and their distribution to the members of the group; if part
of this compensation amount remains unclaimed, it will be donated
to a worthy public cause. In addition, DIC will pay a total of
NIS 3.6 million, its part of compensation to the applicant in the
Legal Proceedings, most of it as fees for its counsel.
-- The settlement agreement will be published within 7 days in two
daily newspapers and in immediate reports of DIC and the Company.
DYNEGY INC: Stockholder Suit Over Restructuring Continues
---------------------------------------------------------
Proceedings in the stockholder litigation relating to the 2011
prepetition restructuring of DH Debtor Entities (Dynegy Holdings,
LLC, formerly known as Dynegy Holdings Inc., and its wholly owned
subsidiaries) are continuing, according to the Company's May 2,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
In connection with the prepetition restructuring and corporate
reorganization of the DH Debtor Entities and their non-debtor
affiliates in 2011, and specifically the DMG Transfer, a putative
class action stockholder lawsuit captioned Charles Silsby v. Carl
C. Icahn, et al., Case No. 12CIV2307, was filed in the United
States District Court of the Southern District of New York. The
lawsuit challenged certain disclosures made in connection with the
DMG Transfer.
The company believes the plaintiff's complaint lacks merit and
will continue to oppose the Securities Litigation vigorously. As a
result of the filing of the voluntary petition for bankruptcy by
Dynegy Inc., this lawsuit was stayed as against Dynegy Inc. and as
a result of the confirmation of the Plan, the claims against
Dynegy Inc. in the Securities Litigation are permanently enjoined.
On August 24, 2012, the lead plaintiff in the Securities
Litigation filed an objection to the confirmation of the Plan
asserting, among other things, that lead plaintiff should be
permitted to opt-out of the non-debtor releases and injunctions in
the Plan on behalf of all putative class members. The company
opposed that relief.
On October 1, 2012, the Bankruptcy Court ruled that lead plaintiff
did not have standing to object to the Plan and did not have
authority to opt-out of the Non-Debtor Releases on behalf of any
other party-in-interest. Accordingly, the Securities Litigation
may only proceed against the non-debtor defendants with respect to
members of the putative class who individually opted out of the
Non-Debtor Releases. The lead plaintiff filed a notice of appeal
on October 10, 2012.
EL PASO PIPELINE: Fails to Dismiss "Allen" Suit Over SNG Purchase
-----------------------------------------------------------------
A motion by El Paso Pipeline Partners, L.P. to dismiss the suit
Allen v. El Paso Pipeline GP Company, L.L.C., et al. was denied,
according to the Company's May 2, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
In May 2012, a unitholder of EPB filed a purported class action in
Delaware Chancery Court, alleging both derivative and non
derivative claims, against EPB, and EPB's general partner and its
board.
EPB was named in the lawsuit as both a "Class Defendant" and a
"Derivative Nominal Defendant." The complaint alleges a breach of
the duty of good faith and fair dealing in connection with the
March 2011 sale to EPB of a 25% ownership interest in Southern
Natural Gas Company, L.L.C. (SNG). Defendants' motion to dismiss
was denied. Defendants continue to believe this action is without
merit and intend to defend against it vigorously.
ELECTRONIC ARTS: Consumers to Get More Under Modified Settlement
----------------------------------------------------------------
Jonathan Hood, writing for ConsumerAffairs, reports that consumers
covered by a class action lawsuit against EA Sports have tripled
their winnings without lifting a finger, thanks to a federal judge
who has modified the details of a $27 million settlement fund.
The case involves EA Sports football video games. A 2008 class
action claimed that EA stifled competing games by partnering with
the National Football League, the National Collegiate Athletic
Association, the Arena Football League and Collegiate Licensing
Co.
They claimed EA monopolized the market for such games, letting it
charge more "Madden NFL," "NCAA Football" and "Arena Football
League," and gouge customers.
Initially, U.S. District Judge Claudia Wilken approved a
settlement that would have provided $6.79 to consumers who bought
EA football games for the XBox, Playstation 2, PC or GameCube
between 2005 and 2012 while those who purchased the titles for
XBox 360, Playstation 3 or Wii platorms could claim up to $1.95
per game.
But in modifying the settlement, Judge Wilken ordered that the
first gorup of consumers receive payments of $20.37 for up to
eight games while those who purchased the games for Xbox 360,
Playstation 3 or Wii platforms will get $5.85 per title.
Individual payments could be reduced, however, if total claims
exceed the $27 million.
Details on how to file a claim are available at
http://www.easportslitigation.com/
The settlement provides that EA cannot renew its exclusive NCAA
and CLC football licenses for at least five years after they
expire in 2014. Nor can it acquire exclusive rights to the AFL
for five years. It gets to keep its NFL exclusivity.
ENERGYSOLUTIONS INC: Signs MOU to Settle Merger-Related Suits
-------------------------------------------------------------
EnergySolutions, Inc., entered in April 2013 into a memorandum of
understanding to settle merger-related class action lawsuits,
according to the Company's May 10, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On January 7, 2013, the Company entered into an Agreement and Plan
of Merger (the "Merger Agreement") with Rockwell Holdco, Inc., a
Delaware corporation ("Parent"), and Rockwell Acquisition Corp., a
Delaware corporation and a wholly owned subsidiary of Parent
("Merger Sub"). Parent and Merger Sub are affiliates of Energy
Capital Partners II, LP and its parallel funds (together with its
affiliates, "Energy Capital Partners"), a leading private equity
firm focused on investing in North America's energy
infrastructure. Pursuant to the Merger Agreement, the Merger Sub
will merge with and into the Company (the "Merger") and the
Company will become a wholly-owned subsidiary of Parent.
Following the Company's January 7, 2013 announcement that it had
entered into a Merger Agreement providing for the acquisition of
the Company by Parent, an entity formed by Energy Capital
Partners, ten purported class action lawsuits were brought against
the Company, the members of the Company's board of directors,
Energy Capital Partners II, LLC, Parent and Merger Sub. Six
lawsuits were filed in the Delaware Court of Chancery, captioned
Printz v. Rogel, et al., C.A. No. 8302-VCG (Jan. 10, 2013);
Bushansky v. EnergySolutions, Inc., et al., C.A. No. 8210 (Jan.
11, 2013); Danahare v. EnergySolutions, Inc., et al., C.A. No.
8219 (Jan. 15, 2013); Graham v. EnergySolutions, Inc., et al.
(Jan. 15, 2013), and Lebron v. EnergySolutions, Inc., et al., C.A.
No. 8223 (Jan. 15, 2013); Louisiana Municipal Police Employees'
Retirement System v. EnergySolutions, Inc., et al., C.A. No. 8350
(Feb. 22, 2013), (the "Delaware actions"). On January 19, 2013,
the Court of Chancery entered an order consolidating the Delaware
actions as In re EnergySolutions, Inc. Shareholder Litigation,
Consolidated C.A. No. 8203-VCG. On January 28, 2013, the Court of
Chancery entered an Order of Class Certification and Case
Management which, among other things, certified a non opt-out
class of EnergySolutions stockholders consisting of all persons
who held shares of stock of EnergySolutions (excluding defendants
named in the Delaware actions and their immediate family members,
any entity controlled by any of the defendants, and any successors
in interest thereto) at any time during the period from and
including January 7, 2013, through the date of consummation or
termination of the Merger.
On March 15, 2013, without admitting any wrongdoing and to avoid
the burden, expense and disruption of continued litigation,
EnergySolutions, Inc., the members of the Company's board of
directors, Energy Capital Partners II, LLC, Parent and Merger Sub
entered into a memorandum of understanding with the plaintiffs in
the Delaware actions providing for the settlement in principle of
the claims brought by the plaintiffs in the Delaware actions.
Pursuant to the memorandum of understanding, the Company included
additional disclosures in the Company's proxy statement requested
by the plaintiffs in the Delaware actions. The parties to the
Delaware actions are in the process of documenting the settlement
and will present the settlement to the Delaware Court of Chancery
for approval when that documentation is complete. In approving
the settlement, the Delaware Court of Chancery may also require
the Company to pay plaintiffs' attorney fees, the amount of which
has not been determined.
The other four lawsuits were filed in the Utah State District
Court, Third Judicial District, Salt Lake County, and are titled
Mohammed v. EnergySolutions, Inc., et al., No. 130400388 (Jan. 10,
2013); Luck v. EnergySolutions, Inc., et al. No. 130900256 (Jan.
11, 2013); Braiker v. EnergySolutions, Inc., et al., No. 130900573
(Jan. 25, 2013); and Temmler v. EnergySolutions, Inc., et al., No.
130900684 (Jan 31, 2013), (the "Utah actions"). On February 1,
2013, the Company and certain defendants filed a Motion to Dismiss
or Stay, or in the Alternative for Extension of Time to Respond to
Complaint in the Luck action, seeking to dismiss or stay the
action in deference to the Delaware actions.
On April 9, 2013, without admitting any wrongdoing and to avoid
the burden, expense and disruption of continued litigation,
EnergySolutions, Inc., the members of the Company's board of
directors, Energy Capital Partners II, LLC, Parent and Merger Sub
entered into a memorandum of understanding with the plaintiffs in
the Utah actions, providing for the settlement in principle of the
claims brought by the plaintiffs in the Utah actions. Pursuant to
the memorandum of understanding, the Company included additional
disclosures in this proxy statement supplement requested by the
plaintiffs in the Utah actions. The parties to the Utah actions
are in the process of documenting the settlement and will present
the settlement to the Utah State District Court, Third Judicial
District, Salt Lake County for approval when that documentation is
complete.
Collectively, the Delaware actions and Utah actions generally
allege that the individual defendants breached their fiduciary
duties in connection with the Merger because the merger
consideration is unfair, that certain other terms in the Merger
Agreement are unfair, and that certain individual defendants are
financially interested in the Merger. Some of the actions further
allege that Energy Capital Partners, Parent and Merger Sub aided
and abetted these alleged breaches of fiduciary duty. Among other
remedies, the lawsuits seek to enjoin the Merger, or in the event
that an injunction is not awarded, unspecified money damages,
costs and attorneys' fees.
The Company believes that each of the Delaware actions and Utah
actions is without merit, and the Company intends to vigorously
defend against all claims asserted to the extent not yet resolved.
EnergySolutions, Inc. -- http://www.energysolutions.com/-- was
incorporated in Delaware and is headquartered in Salt Lake City,
Utah. The Company is a provider of a broad range of nuclear
services to government and commercial customers, which services
include engineering, in-plant support services, spent nuclear fuel
management, decontamination and decommissioning, operation of
nuclear reactors, logistics, transportation, processing and low-
level radioactive waste disposal.
ENSTAR GROUP: Yet to File Settlement Documents in Merger Suits
--------------------------------------------------------------
Enstar Group Limited has not yet filed with the court its
settlement of merger-related class action lawsuits, according to
the Company's May 10, 2013, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2013.
On February 7, 2013, the Company completed its acquisition of
SeaBright Holdings, Inc., through the merger of its indirect,
wholly-owned subsidiary, AML Acquisition, Corp. ("AML
Acquisition"), with and into SeaBright (the "Merger"), with
SeaBright surviving the Merger as the Company's indirect, wholly-
owned subsidiary. SeaBright owns SeaBright Insurance Company, an
Illinois-domiciled insurer that is commercially domiciled in
California, which wrote direct workers' compensation business. The
aggregate cash purchase price paid by the Company for all equity
securities of SeaBright was approximately $252.1 million, which
was funded in part with $111.0 million borrowed under a four-year
term loan facility provided by National Australia Bank and
Barclays Bank PLC.
In connection with the Company's acquisition of SeaBright, two
purported class action lawsuits were filed against SeaBright, the
members of its board of directors, AML Acquisition, and, in one of
the cases, the Company. The first lawsuit was filed September 13,
2012, in the Superior Court of the State of Washington and the
second lawsuit was filed September 20, 2012, in the Court of
Chancery of the State of Delaware. The lawsuits allege, among
other things, that SeaBright's directors breached their fiduciary
duties when negotiating, approving and seeking stockholder
approval of the Merger, and that SeaBright and the Company or its
merger subsidiary aided and abetted the alleged breaches of
fiduciary duties. In the lawsuits, the plaintiffs sought to
enjoin defendants from taking any action to consummate the
transactions contemplated by the Merger Agreement, as well as
monetary damages, including attorneys' fees and expenses.
The Company believes these lawsuits are without merit.
Nevertheless, in order to avoid the potential cost and distraction
of continued litigation and to eliminate any risk of delay to the
closing of the Merger, the Company, SeaBright and the SeaBright
director defendants agreed in principle to settle the two
lawsuits, without admitting any liability or wrongdoing. The
settlement required SeaBright to make supplemental information
available to its stockholders through a filing of a Current Report
on Form 8-K with the U.S. Securities and Exchange Commission. The
settlement did not change the amount of the consideration that the
Company paid to SeaBright's stockholders in any way, nor did it
alter any deal terms. The settlement is subject to execution and
delivery of definitive documentation, approval by the Washington
court of the settlement and approval by the Delaware court of the
dismissal of the Delaware lawsuit. If the settlement becomes
effective, both lawsuits will be dismissed.
Enstar Group Limited -- http://www.enstargroup.com/-- is a
Bermuda-based company that acquires and manages insurance and
reinsurance companies in run-off and portfolios of insurance and
reinsurance business in run-off, and provides management,
consulting and other services to the insurance and reinsurance
industry.
FACEBOOK INC: Lawsuits, Investigations on IPO Ongoing
-----------------------------------------------------
Facebook, Inc. continues to face lawsuits in relation to its
initial public offering just as various government inquiries are
being conducted into the events surrounding the IPO.
The Company said on its May 2, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013: "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 us, our directors, and/or certain of
our officers alleging violation of securities laws or breach of
fiduciary duties in connection with our IPO and seeking
unspecified damages."
"We believe these lawsuits are without merit, and we intend to
continue to vigorously defend them.
"On October 4, 2012, on our 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 our IPO,
were ordered centralized for coordinated or consolidated pre-trial
proceedings in the United States District Court for the Southern
District of New York.
"On February 13, 2013, the court granted our motion to dismiss
four derivative actions against our directors and certain of our
officers. In addition, the events surrounding our IPO have become
the subject of various government inquiries, and we are
cooperating with those inquiries."
FBR & CO: Appeal From Thornburg Suit Dismissal Remains Pending
--------------------------------------------------------------
In May 2008, the lead plaintiff in a previously filed and
consolidated action filed an amended consolidated class action
complaint that, for the first time, named Friedman, Billings,
Ramsey & Co., Inc. (now FBR Capital Markets & Co. ("FBRCM"), FBR &
Co.'s principal U.S. broker-dealer subsidiary) and eight other
underwriters as defendants. The lawsuit, styled In Re Thornburg
Mortgage, Inc. Securities Litigation and pending in the United
States District Court for the District of New Mexico, was
originally filed in August 2007 against Thornburg Mortgage, Inc.
("TMI"), and certain of its officers and directors, alleging
material misrepresentations and omissions about, inter alia, the
financial position of TMI. The amended complaint included claims
under Sections 11 and 12 of the Securities Act against nine
underwriters relating to five separate offerings (May 2007, June
2007, September 2007 and two offerings in January 2008). The
allegations against FBRCM related only to its role as underwriter
or member of the syndicate that underwrote TMI's total of three
offerings in September 2007 and January 2008 -- each of which
occurred after the filing of the original complaint. The
plaintiffs sought restitution, unspecified compensatory damages
and reimbursement of certain costs and expenses. Although FBRCM
is contractually entitled to be indemnified by TMI in connection
with this lawsuit, TMI filed for bankruptcy on May 1, 2009, and
this likely will decrease or eliminate the value of the indemnity
that FBRCM receives from TMI.
On June 2, 2011, the Court granted FBRCM's motion to dismiss the
consolidated class action complaint as to FBRCM and then entered
final judgment for FBRCM on July 25, 2011. The Plaintiffs filed a
timely notice of appeal to the 10th Circuit Court of Appeals,
challenging the District Court's findings; briefing on the appeal
is complete and oral argument at the Court of Appeals has been
heard. Claims relating to the two January 2008 offerings have
been voluntarily dismissed with prejudice by the plaintiffs. The
claims against FBRCM relating to the September 2007 offering
remain on appeal.
No further updates were reported in the Company's May 10, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
FBR & Co. -- http://www.fbr.com/-- provides investment banking,
merger and acquisition advisory, institutional brokerage, and
research services through its subsidiary, FBR Capital Markets &
Co. FBR, which is headquartered in Arlington, Virginia, focuses
capital and financial expertise on the following industry sectors:
consumer; diversified industrials; energy & natural resources;
financial institutions; insurance; real estate; and technology,
media & telecom.
FBR & CO: Briefing on Appeal in Colorado Securities Suit Ongoing
----------------------------------------------------------------
Briefing on the appeal from the dismissal of a securities class
action lawsuit against a subsidiary of FBR & Co. is ongoing,
according to the Company's May 10, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
FBR Capital Markets & Co. ("FBRCM") FBRCM has been named a
defendant in the putative class action lawsuit MHC Mutual
Conversion Fund, L.P. v. United Western Bancorp, Inc., et al.,
pending in the United States District Court for the District of
Colorado. The complaint, filed in March 2011 against United
Western Bancorp, Inc. (the "Bank"), its officers and directors,
underwriters and outside auditors, alleges material
misrepresentations and omissions in the registration statement and
prospectus issued in connection with the Bank's September 2009
offering. The complaint alleges claims under Sections 11 and 12
of the Securities Act against the lead underwriter of the offering
and FBRCM as a member of the underwriting syndicate. Although
FBRCM is contractually entitled to be indemnified by the Bank in
connection with this lawsuit, the Bank filed for bankruptcy on
March 5, 2012, and this likely will decrease or eliminate the
value of the indemnity that FBRCM receives from the Bank. On
December 19, 2012, the Court granted Defendants' motion to dismiss
the class action complaint with prejudice and entered final
judgment for the underwriters. The class plaintiffs filed a
timely notice of appeal to the 10th Circuit Court of Appeals,
challenging the District Court's findings; briefing on the appeal
is ongoing.
FBR & Co. -- http://www.fbr.com/-- provides investment banking,
merger and acquisition advisory, institutional brokerage, and
research services through its subsidiary, FBR Capital Markets &
Co. FBR, which is headquartered in Arlington, Virginia, focuses
capital and financial expertise on the following industry sectors:
consumer; diversified industrials; energy & natural resources;
financial institutions; insurance; real estate; and technology,
media & telecom.
FBR & CO: Definitive Agreements Forthcoming in Imperial IPO Suits
-----------------------------------------------------------------
Definitive settlement agreements are forthcoming in the class
action lawsuits arising from the initial public offering of
Imperial Holdings, Inc., according to FBR & Co.'s May 10, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
FBR Capital Markets & Co. ("FBRCM") has been named a defendant in
four putative class action lawsuits all alleging substantially
identical claims against Imperial Holdings, Inc. ("Imperial"), its
officers and directors and underwriters for material
misrepresentations and omissions in the registration statement and
prospectus issued in connection with Imperial's February 2011
initial public offering. The cases, all currently pending in the
Southern District of Florida, are captioned: Martin J. Fuller v.
Imperial Holdings, Inc., et al.; City of Roseville Employees
Retirement System v. Imperial Holdings, et al.; Sauer v. Imperial
Holdings, et al.; and Pondick v. Imperial Holdings, et al. The
complaints allege claims under Sections 11 and 12 of the
Securities Act against the lead underwriters of the offering.
Imperial has assumed its contractual obligation to indemnify the
underwriters. As of December 19, 2012, Imperial and all other
relevant parties, including FBRCM, executed a non-binding term
sheet to settle the class action lawsuits. Definitive settlement
agreements are forthcoming.
In accordance with applicable accounting guidance, the Company
says it establishes an accrued liability for litigation and
regulatory matters when those matters present loss contingencies
that are both probable and estimable. In such cases, there may be
an exposure to loss in excess of any amounts accrued. When a loss
contingency is not both probable and estimable, the Company does
not establish an accrued liability. As a litigation or regulatory
matter develops, management, in conjunction with counsel,
evaluates on an ongoing basis whether such matter presents a loss
contingency that is probable and estimable. The cases involving
the Company are at a preliminary stage, based on management's
review with counsel and present information known by management,
loss contingencies for these matters are not probable and
estimable as of March 31, 2013.
FBR & Co. -- http://www.fbr.com/-- provides investment banking,
merger and acquisition advisory, institutional brokerage, and
research services through its subsidiary, FBR Capital Markets &
Co. FBR, which is headquartered in Arlington, Virginia, focuses
capital and financial expertise on the following industry sectors:
consumer; diversified industrials; energy & natural resources;
financial institutions; insurance; real estate; and technology,
media & telecom.
FIRST CALIFORNIA: Yet to Sign Stipulation in Merger-Related Suit
----------------------------------------------------------------
First California Financial Group, Inc., is yet to sign a
stipulation of settlement in connection with its memorandum of
understanding to settle a merger-related class action lawsuit,
according to the Company's May 10, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On November 6, 2012, First California entered into an Agreement
and Plan of Merger, or the Merger Agreement, with PacWest Bancorp,
or PacWest. Under the terms of the Merger Agreement the Company
will be merged with and into PacWest, with PacWest as the
surviving corporation, referred to as the PacWest Merger. The
Merger Agreement also provides that, simultaneously with the
PacWest Merger, First California Bank will merge with and into
Pacific Western Bank, a wholly owned subsidiary of PacWest, with
Pacific Western Bank continuing as the surviving bank.
On November 20, 2012, a purported stockholder of the Company filed
a lawsuit in connection with the proposed merger between the
Company and PacWest announced on November 6, 2012. Captioned Paul
Githens v. C.G. Kum, et al., Case No. BC496018, the lawsuit was
filed in the Superior Court of the State of California, Los
Angeles County, against the Company, its directors, and PacWest.
It is brought as a putative class action and alleges that the
Company's directors breached certain alleged fiduciary duties to
the Company's stockholders by approving the merger agreement
pursuant to an allegedly unfair process and at an allegedly unfair
price. It alleges that PacWest aided and abetted those breaches.
The lawsuit seeks, among other things, to enjoin consummation of
the merger. On January 24, 2013, the plaintiff filed an amended
complaint, adding claims that the defendants failed to disclose
material information concerning the merger. On March 4, 2013, the
court sustained the defendants' demurrers to the plaintiff's
complaint with leave to amend. On March 14, 2013, the plaintiff
filed an amended complaint.
On March 17, 2013, the Company and PacWest entered into a
memorandum of understanding with the plaintiff in the lawsuit
regarding the settlement of the lawsuit. In connection with the
settlement of the lawsuit, the Company made supplemental
disclosures to the Company's Definitive Proxy Statement on
Schedule 14A filed with the SEC on February 13, 2013, by filing a
Form 8-K filed with the SEC on March 18, 2013. The memorandum of
understanding also contemplates that the parties will enter into a
stipulation of settlement. The stipulation of settlement will be
subject to customary conditions, including court approval
following notice to the Company's stockholders. In the event that
the parties enter into a stipulation of settlement, a hearing will
be scheduled at which the Superior Court of the State of
California will consider the fairness, reasonableness and adequacy
of the settlement. If the settlement is finally approved by the
court, it will resolve and release all claims in all actions that
were or could have been brought challenging any aspect of the
proposed merger, the merger agreement and any disclosure made in
connection therewith, pursuant to terms that will be disclosed to
the Company's stockholders prior to final approval of the
settlement.
In addition, in connection with the settlement, the parties
contemplate that the plaintiff's counsel will file a petition in
the Superior Court of the State of California for an award of
attorneys' fees and expenses to be paid by the Company or its
successor. The settlement will not affect the consideration that
the Company's stockholders are entitled to receive in the merger.
There can be no assurance that the parties will enter into a
stipulation of settlement, or that the court will approve any
proposed settlement. In such event, the proposed settlement as
contemplated by the memorandum of understanding may be terminated.
First California Financial Group, Inc. --
http://www.fcalgroup.com/-- is a bank holding company
incorporated in Delaware in 2006 and headquartered in Westlake
Village, California. First California's primary function is to
coordinate the general policies and activities of its bank
subsidiary, First California Bank, as well as to consider from
time to time other legally available investment opportunities.
GENERAL MOTORS: GM Canada Dealers' Lawsuit Continues
----------------------------------------------------
A class action against General Motors of Canada Limited (GMCL) is
proceeding before the Ontario Superior Court of Justice, according
to General Motors Company's May 2, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On February 12, 2010, a claim was filed in the Ontario Superior
Court of Justice against General Motors of Canada Limited (GMCL)
on behalf of a purported class of over 200 former GMCL dealers
(the Plaintiff Dealers) which had entered into wind-down
agreements with GMCL.
In May 2009 in the context of the global restructuring of the
business and the possibility that GMCL might be required to
initiate insolvency proceedings, GMCL offered the Plaintiff
Dealers the wind-down agreements to assist with their exit from
the GMCL dealer network and to facilitate winding down their
operations in an orderly fashion by December 31, 2009 or such
other date as GMCL approved but no later than on October 31, 2010.
The Plaintiff Dealers allege that the Dealer Sales and Service
Agreements were wrongly terminated by GMCL and that GMCL failed to
comply with certain disclosure obligations, breached its statutory
duty of fair dealing and unlawfully interfered with the Plaintiff
Dealers' statutory right to associate in an attempt to coerce the
Plaintiff Dealers into accepting the wind-down agreements.
The Plaintiff Dealers seek damages and assert that the wind-down
agreements are rescindable. The Plaintiff Dealers' initial
pleading makes reference to a claim "not exceeding" CAD $750
million, without explanation of any specific measure of damages.
On March 1, 2011 the court approved certification of a class for
the purpose of deciding a number of specifically defined issues
including: (1) whether GMCL breached its obligation of "good
faith" in offering the wind-down agreements; (2) whether GMCL
interfered with the Plaintiff Dealers' rights of free association;
(3) whether GMCL was obligated to provide a disclosure statement
and/or disclose more specific information regarding its
restructuring plans in connection with proffering the wind-down
agreements; and (4) assuming liability, whether the Plaintiff
Dealers can recover damages in the aggregate (as opposed to
proving individual damages).
On June 22, 2011 the court granted GMCL permission to appeal the
class certification decision. On March 26, 2012 the Ontario
Superior Court dismissed GMCL's appeal of the class certification
order. Accordingly the case will proceed as a class action.
Twenty-six dealers within the certified class definition have
indicated that they will not participate.
GENWORTH HOLDINGS: Barlee Case v. Subsidiary Dismissed
------------------------------------------------------
Beginning in December 2011 and continuing through January 2013,
one of Genworth Holdings, Inc.'s U.S. mortgage insurance
subsidiaries was named along with several other mortgage insurance
participants and mortgage lenders as a defendant in twelve
putative class action lawsuits alleging that certain "captive
reinsurance arrangements" were in violation of RESPA.
The Barlee case was dismissed by the Court with prejudice as to
our subsidiary and certain other defendants on February 27, 2013.
In the Riddle case, the defendants' motion to dismiss was denied,
but the Court limited discovery at this stage to issues
surrounding the statute of limitations, according to the Company's
May 2, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2013.
GNC HOLDINGS: Settles Calif. Consolidated Suit Over Hydroxycut
--------------------------------------------------------------
GNC Holdings, Inc. faces six putative class actions in relation to
Hydroxycut as of the end of March 2013, the company disclosed in
its May 2, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2013.
As of March 31, 2013, there were 73 pending lawsuits related to
Hydroxycut in which the Company has been named: 67 individual,
largely personal injury claims and six putative class action
cases, generally inclusive of claims of consumer fraud,
misrepresentation, strict liability and breach of warranty.
In 2009, the United States Judicial Panel on Multidistrict
Litigation consolidated pretrial proceedings of many of the
pending actions in the Southern District of California (In re:
Hydroxycut Marketing and Sales Practices Litigation, MDL No.
2087).
The parties in the consolidated class actions have reached a
settlement, and the settlement has been preliminarily approved by
the Court. The parties' motion for final approval of the
settlement was heard on April 23, 2013. The Company is not
required to make any payments under the settlement.
GOLD COAST: Arundel Hills Residents Sue Over Suntown Tip Operation
------------------------------------------------------------------
The Australian Associated Press reports that residents of an
exclusive Gold Coast residential estate are suing the city's
council, claiming a nearby rubbish tip is destroying property
values.
Residents of the Arundel Hills Country Club Estate launched a
class action at Queensland's Supreme Court on June 4, saying the
council had been negligent in the design and construction of the
estate.
The action, which has been lodged by Helen and Peter Kinsella on
behalf of several residents, also claims the Gold Coast City
Council's operation of the Suntown Tip had led to gases being
released into adjoining properties.
Lawyers for the plaintiffs claim council advertised plans to close
the tip completely and redevelop the site as parkland before parts
of the estate were developed and sold.
Mrs. Kinsella says she was among several people who bought
property on that promise.
"Before we bought our land in 2000, the Council resolved to close
the tip," she said in a statement.
"They had a public consultation process then, but still the tip
remains open 13 years later."
Mrs. Kinsella said residents had been forced to go to court, as
council "left them in the dark" as to their future plans for the
site.
"In 2009 we were informed that there were landfill gases leaking
into our estate and this is still ongoing after four years," she
said.
"Our home is our main asset and we are worried that because of the
tip, it would be undesirable to prospective purchasers should we
ever be in a position that we need to sell."
Mrs. Kinsella said to her knowledge, only one property had been
sold in her street since the gas problems were discovered in 2009
and that was at a "greatly reduced price".
AAP is seeking comment from Gold Coast City Council.
GRANNA'S LLC: Recalls #705 Tuna Mac With Italian Blend Vegetables
-----------------------------------------------------------------
Granna's LLC is voluntarily recalling packages of #705 Tuna Mac
that may contain an undeclared egg allergen. People who have an
allergy or severe sensitivity to egg run the risk of serious or
life-threatening allergic reaction if they consume this product.
Product was distributed in Oklahoma through senior nutritional
sites by home delivery.
The affected product, #705 Tuna Mac, was labeled without egg white
ingredient in the ingredient statement.
Granna's #705 Tuna Mac with Italian blend vegetables and spiced
apple rings is a frozen dinner packaged in a black, three
compartment heat sealed tray, with label located on top. Best by
dates are printed on each label. Only the misprinted packages of
#705 Tuna Mac, with best by dates of 06/20/2013 to 06/20/2014, are
included in the recall. No other Granna's products are affected.
Picture of the recalled products' label is available at:
http://www.fda.gov/Safety/Recalls/ucm358217.htm
This product is a food safety concern for people who are allergic
to eggs.
Consumers would have received the mislabeled product between June
2012 and June 2013. Affected packages should be discarded or
returned to the place of purchase for a refund.
There have been no illnesses as of June 20, 2013, reported in
connection with this product.
Consumers with questions on the recall may contact Granna's LLC at
1-580-337-6360.
Phone will be answered between 8:00 a.m. and 3:30 p.m. Central
Standard Time, Monday - Friday.
HCA HOLDINGS: Awaits Ruling in Motion to Dismiss Tenn. Stock Suit
-----------------------------------------------------------------
HCA Holdings, Inc. expects to receive a decision from the United
States District Court for the Middle District of Tennessee by mid-
to-late 2013 on its motion to dismiss an amended complaint in a
consolidated securities lawsuit filed against it, according to the
company's May 7, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2013.
On October 28, 2011, a shareholder action, Schuh v. HCA Holdings,
Inc. et al., was filed in the United States District Court for the
Middle District of Tennessee seeking monetary relief. The case
sought to include as a class all persons who acquired the
Company's stock pursuant or traceable to the Company's
Registration Statement issued in connection with the March 9, 2011
initial public offering.
The lawsuit asserted a claim under Section 11 of the Securities
Act of 1933 against the Company, certain members of the board of
directors, and certain underwriters in the offering. It further
asserted a claim under Section 15 of the Securities Act of 1933
against the same members of the board of directors. The action
alleged various deficiencies in the Company's disclosures in the
Registration Statement.
Subsequently, two additional class action complaints, Kishtah v.
HCA Holdings, Inc. et al. and Daniels v. HCA Holdings, Inc. et
al., setting forth substantially similar claims against
substantially the same defendants were filed in the same federal
court on November 16, 2011 and December 12, 2011, respectively.
All three of the cases were consolidated. On May 3, 2012, the
court appointed New England Teamsters & Trucking Industry Pension
Fund as Lead Plaintiff for the consolidated action. On July 13,
2012, the lead plaintiff filed an amended complaint asserting
claims under Sections 11 and 12(a)(2) of the Securities Act of
1933 against the Company, certain members of the board of
directors, and certain underwriters in the offering. It further
asserts a claim under Section 15 of the Securities Act of 1933
against the same members of the board of directors and Hercules
Holdings II, LLC, a majority shareholder of the Company.
The consolidated complaint alleges deficiencies in the Company's
disclosures in the Registration Statement and Prospectus relating
to: (1) the accounting for the Company's 2006 recapitalization and
2010 reorganization; (2) the Company's failure to maintain
effective internal controls relating to its accounting for such
transactions; and (3) the Company's Medicare and Medicaid revenue
growth rates.
The Company and other defendants moved to dismiss the amended
complaint on September 11, 2012. The Court heard argument on the
motion in April 2013. A decision on the motion is anticipated mid-
to-late 2013.
In addition to the shareholder class actions, on December 8, 2011,
a federal shareholder derivative action, Sutton v. Bracken, et
al., putatively initiated in the name of the Company, was filed in
the United States District Court for the Middle District of
Tennessee against certain officers and present and former
directors of the Company seeking monetary relief. The action
alleges breaches of fiduciary duties by the named officers and
directors in connection with the accounting and earnings claims
set forth in the shareholder class actions.
Setting forth substantially similar claims against substantially
the same defendants, an additional federal derivative action,
Schroeder v. Bracken, et al., was filed in the United States
District Court for the Middle District of Tennessee on December
16, 2011, and a state derivative action, Bagot v. Bracken, et al.,
was filed in Tennessee state court in the Davidson County Circuit
Court on December 20, 2011. The federal derivative actions have
been consolidated in the Middle District of Tennessee and the
parties have agreed that those cases shall be stayed pending
developments in the shareholder class actions. The state
derivative action has also been stayed pending developments in the
shareholder class actions.
HERTZ CORPORATION: Class Certified in Nev. Car Rental Lawsuit
-------------------------------------------------------------
The United States District Court for the District of Nevada
granted the plaintiffs' motion for class certification in a suit
filed on behalf of all persons who rented cars from The Hertz
Corporation at airports in Nevada and were allegedly separately
charged airport concession recovery fees, according to Hertz
Global Holding Inc.'s May 2, 2013, Form 10-Q filing with the
U.S.Securities and Exchange Commission for the quarter ended March
31, 2013.
Enterprise is now a defendant in a separate action and is no
longer a defendant in the Sobel case. The Sobel case purports to
be a nationwide class action on behalf of all persons who rented
cars from Hertz at airports in Nevada and were separately charged
airport concession recovery fees by Hertz as part of their rental
charges.
In the complaint, the plaintiffs seek an unspecified amount of
compensatory damages, restitution of any charges found to be
improper and an injunction prohibiting Hertz from quoting or
charging those airport fees that are alleged not to be allowed by
Nevada law. The complaint also seeks attorneys' fees and costs. In
2010, the parties engaged in mediation which resulted in a
proposed settlement.
Although the court tentatively approved the settlement in November
2010, the court denied the plaintiffs' motion for final approval
of the proposed settlement in May 2011. Following additional
activity in the case, in March 2013, the court granted, in part,
the plaintiffs' motion for partial summary judgment with respect
to restitution and granted the plaintiffs' motion for class
certification, while denying the Company's motion for partial
summary judgment.
The court further indicated that plaintiffs are entitled to
prejudgment interest from the date of the plaintiffs' first
amended complaint. A judgment has not yet been entered in the
case, and there are expected to be further proceedings before the
district court.
The amount of a judgment could potentially exceed $40.0 million.
The Company intends to appeal or seek other appropriate relief and
believes that the court's liability, damages and class
certification findings will be reversed.
HERTZ GLOBAL: June Hearing on Accord in "Davis Landscape" Suit
--------------------------------------------------------------
In Davis Landscape, Ltd. et al. v. Hertz Equipment Rental
Corporation, the parties executed a settlement agreement in March
2013 and thereafter sought preliminary approval from the court of
the proposed class settlement.
The court was set to tentatively approve the proposed class
settlement and the parties' notice plan. June 18, 2013 was the
date for the final approval hearing, according to the Company's
May 2, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2013.
IKANOS COMMUNICATIONS: Settlement in Securities Action Approved
---------------------------------------------------------------
The United States District Court for the Southern District of New
York granted preliminary approval of the settlement of the suit
filed against Ikanos Communications Inc. over its stock offerings.
The final settlement conference is set for July 8, 2013, according
to the Company's May 2, 2013, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2013.
In November 2006, three putative class action lawsuits were filed
in the United States District Court for the Southern District of
New York (District Court), against the Company, certain then
current and former directors and officers, as well as the lead
underwriters for its initial and secondary public offerings. The
lawsuits were consolidated and an amended complaint was filed on
April 24, 2007.
The amended complaint sought unspecified damages for certain
alleged misrepresentations and omissions made by the Company in
connection with both its initial public offering in September 2005
and its follow-on offering in March 2006. On June 25, 2007, the
Company filed motions to dismiss the amended complaint, and on
March 10, 2008, the District Court dismissed the case with
prejudice.
On March 25, 2008, plaintiffs filed a motion for reconsideration,
and on June 12, 2008, the District Court denied the motion for
reconsideration. On October 15, 2008, plaintiffs appealed the
District Court's dismissal of the amended complaint and denial of
its motion for reconsideration to the United States Court of
Appeals for the Second Circuit (Court of Appeals).
On September 17, 2009, the Court of Appeals affirmed the District
Court's dismissal of the amended complaint, but vacated its
judgment on the motion for reconsideration and remanded the case
to the District Court for further proceedings.
On June 11, 2010, plaintiffs filed a motion for leave to amend the
complaint in the District Court, and on November 23, 2010, the
District Court denied the motion. On January 6, 2011, plaintiffs
filed a notice of appeal with the Court of Appeals. On May 25,
2012, the Court of Appeals granted plaintiffs' appeal, finding
that their proposed amended complaint succeeded in stating a
claim.
The case was remanded to the District Court for further
proceedings, and on June 19, 2012, plaintiffs filed their Third
Amended Class Action Complaint. The parties held a mediation on
December 6, 2012 and agreed to a tentative agreement to settle the
case. The plaintiffs submitted a motion for preliminary approval
of the settlement on February 28, 2013, and on March 25, 2013, the
District Court held a conference and granted preliminary approval
of the settlement. The final settlement conference is set for July
8, 2013. Settlement costs are fully covered by insurance.
IMPAX LABORATORIES: Securities Suits Filed in March & April
-----------------------------------------------------------
On March 7, 2013 and April 8, 2013, two class action complaints
were filed against Impax Laboratories and certain current and
former officers and directors of the Company in the United States
District Court for the Northern District of California by Denis
Mulligan, individually and on behalf of others similarly situated,
and Haverhill Retirement System, individually and on behalf of
others similarly situated, respectively, ("Securities Class
Actions"), according to the company's May 3, 2013, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the year ended March 1, 2013.
The suits allege that the Company and those named officers and
directors violated the federal securities law by making materially
false and misleading statements and/or failed to disclose material
adverse facts to the public in connection with manufacturing
deficiencies at the Hayward, California manufacturing facility,
including but not limited to the impact the deficiencies would
have on the Company's ability to gain approval from the FDA for
the Company's branded product candidate, RYTARY and generic
product Concerta.
These two Securities Class Actions have subsequently been assigned
to the same judge. On March 19, 2013, Virender Singh, derivatively
on behalf of the Company, filed a state court action against
certain current and former officers and board of directors for
breach of fiduciary duty and unjust enrichment in the Superior
Court of the State of California County of Santa Clara, asserting
similar allegations as those in the Securities Class Actions. That
action has been stayed pending resolution of the class action
suit.
In addition, the Company is aware of a letter from a stockholder
demanding action by the Company's board of directors to: (i)
undertake an independent internal investigation into management's
alleged violations of Delaware and/or federal law; and (ii)
commence a civil action against members of management to recover
damages sustained as a result of alleged breaches of fiduciary
duties. The letter further states that if such action is not
commenced within a reasonable period of time, the stockholder will
commence a shareholder's derivative action on behalf of the
Company.
INVESTORS BANCORP: Yet to Ink Deal to Settle Merger-Related Suit
----------------------------------------------------------------
Investors Bancorp, Inc., is yet to enter into a definitive
agreement to settle a merger-related class action lawsuit,
according to the Company's May 10, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On April 25, 2013, Investors Bancorp, Inc. ("Investors Bancorp")
and Roma Financial Corporation ("Roma Financial") entered into a
Memorandum of Understanding (the "MOU") with plaintiffs regarding
the settlement of a putative class action captioned Joseph T.
Zalescik v. Peter Inverso, Michele Siekerka, Alfred DeBlasio, Jr.,
Thomas Bracken, Robert Albanese, William Walsh, Jr., Dennis Bone,
Robert Rosen, Jeffrey Taylor, Roma Financial Corporation, Roma
Financial Corporation, Investors Bancorp, MHC, the Company's
mutual holding company (MHC), Roma Bank, Investors Bancorp, Inc.,
Investors Bancorp MHC, and Investors Bank, pending before the
Superior Court of the State of New Jersey, Chancery Division,
Mercer County (the "Action").
As described in the Joint Proxy Statement/Prospectus of Investors
Bancorp and Roma Financial, dated April 26, 2013 (the "Joint Proxy
Statement"), regarding the proposed merger (the "Merger") of Roma
Bank with and into Investors Bank, Roma Financial within and into
Investors Bancorp and Roma Financial Corporation, MHC with and
into Investors Bancorp, MHC, the Action relates to the Agreement
and Plan of Merger, dated as of December 19, 2012, by and among
(i) Investors Bank, Investors Bancorp, Inc. and Investors Bancorp,
MHC, and (ii) Roma Bank, Roma Financial Corporation and Roma
Financial Corporation, MHC. Pursuant to the MOU, Roma Financial
and Investors Bancorp agreed to make available additional
information to Roma Financial and Investors Bancorp stockholders.
The additional information is contained in the Joint Proxy
Statement.
Investors Bancorp, Roma Financial and the other defendants deny
all of the allegations in the Action and believe the disclosure in
the Registration Statement on Form S-4, filed on March 19, 2013,
was adequate under the law. Nevertheless, Investors Bancorp, Roma
Financial and the other defendants have agreed to settle the
Action in order to avoid the costs, disruption and distraction of
further litigation.
In addition, the Company and its subsidiaries are subject to
various legal actions arising in the normal course of business.
In the opinion of management, the resolution of these legal
actions is not expected to have a material adverse effect on the
Company's financial condition or results of operations.
Investors Bancorp, Inc. -- http://www.myinvestorsbank.com/-- is a
full-service community bank that has been serving customers since
1926. The Company is the holding company for Investors Bank,
which operates from its corporate headquarters in Short Hills, New
Jersey, and 100 offices located throughout northern and central
New Jersey and New York.
ISUZU: Recalls NPR-HD, NQR and NRR Models of Isuzu Trucks
---------------------------------------------------------
Starting date: June 19, 2013
Type of communication: Recall
Subcategory: Truck - Med. & H.D.
Notification type: Safety Mfr
System: Electrical
Units affected: 743
Source of recall: Transport Canada
Identification number: 2013212
TC ID number: 2013212
Manufacturer recall number: DET-13-106
On certain vehicles equipped with an oil pan heater, over time,
dust, dirt and moisture may collect at the contact point between
the oil pan heater cord and the extension cord. As a result, the
extension cord could overheat, which may melt the oil pan heater
plug and/or block heater plug (if equipped). This could result in
a fire causing property damage and/or personal injury.
Correction: Dealers will inspect and clean the oil pan heater plug
and the engine block heater plug (if equipped). Heat damaged
plugs will be replaced. In addition, dealers will replace the
extension cord and advise owners to store the cord indoors when
not in use.
Affected products:
Makes and models affected
-------------------------------------------
Make Model Model year(s) affected
---- ----- ----------------------
ISUZU NQR 2007, 2008, 2009, 2010,
2011, 2012, 2013
ISUZU NRR 2007, 2008, 2009, 2010,
2011, 2012, 2013
ISUZU NPR-HD 2007, 2008, 2009, 2010,
2011, 2012, 2013
JBI INC: Limited Discovery Has Commenced in Stockholder Suit
------------------------------------------------------------
JBI, Inc., disclosed in its May 10, 2013, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013, that limited discovery has commenced in the
stockholder class action lawsuit pending in Nevada.
On July 28, 2011, certain of the Company's stockholders filed a
class action lawsuit against the Company, John Bordynuik, the
Company's founder, and Ronald Baldwin, its former Chief Financial
Officer, on behalf of purchasers of its securities. In an amended
complaint filed on July 10, 2012, these shareholders sought to
represent such purchasers during the period August 28, 2009, and
January 4, 2012. The original and amended complaints in that
case, filed in federal court in Nevada, allege that the defendants
made false or misleading statements, or both, and failed to
disclose material adverse facts about the Company's business,
operations, and prospects in press releases and filings made with
the SEC. Specifically, the lawsuit alleges that the defendants
made false or misleading statements or failed to disclose material
information, or a combination thereof regarding: (1) that the
Media Credits were substantially overvalued; (2) that the Company
improperly accounted for acquisitions; (3) that, as such, the
Company's financial results were not prepared in accordance with
Generally Accepted Accounting Principles; (4) that the Company
lacked adequate internal and financial controls. During the
quarter ended June 30, 2012, a lead plaintiff was appointed in the
case and an amended complaint was filed. The defendants' answer
to the amended complaint was filed during the fourth quarter of
2012. Subsequently, a case management order was entered and
limited discovery commenced. The Company cannot predict the
outcome of the class action litigation at this time.
JBI, Inc., is a Nevada corporation headquartered in Niagara Falls,
New York. During 2009, the Company began operations of its main
business operation, Plastic2Oil, is a combination of proprietary
technologies and processes developed by JBI, which convert waste
plastics into fuel.
KKR & CO: Motion to Junk Complaint in Del. Stock Suit Pending
-------------------------------------------------------------
A motion to dismiss a consolidated amended complaint against KKR &
Co. L.P. in relation to its sale of Primedia Inc. is pending,
according to the Company's May 2, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
On May 23, 2011, KKR, certain KKR affiliates and the board of
directors of Primedia Inc. (a former KKR portfolio company whose
directors at that time included certain KKR personnel) were named
as defendants, along with others, in two shareholder class action
complaints filed in the Court of Chancery of the State of Delaware
challenging the sale of Primedia in a merger transaction that was
completed on July 13, 2011.
These actions allege, among other things, that Primedia board
members, KKR, and certain KKR affiliates, breached their fiduciary
duties by entering into the merger agreement at an unfair price
and failing to disclose all material information about the merger.
Plaintiffs also allege that the merger price was unfair in light
of the value of certain shareholder derivative claims, which were
dismissed on August 8, 2011, based on a stipulation by the parties
that the derivative plaintiffs and any other former Primedia
shareholders lost standing to prosecute the derivative claims on
behalf of Primedia when the Primedia merger was completed.
The dismissed shareholder derivative claims included allegations
concerning open market purchases of certain shares of Primedia's
preferred stock by KKR affiliates in 2002 and allegations
concerning Primedia's redemption of certain shares of Primedia's
preferred stock in 2004 and 2005, some of which were owned by KKR
affiliates.
With respect to the pending shareholder class actions challenging
the Primedia merger, on June 7, 2011, the Court of Chancery denied
a motion to preliminarily enjoin the merger. On July 18, 2011, the
Court of Chancery consolidated the two pending shareholder class
actions and appointed lead counsel for plaintiffs.
On October 7, 2011, defendants moved to dismiss the operative
complaint in the consolidated shareholder class action. The
operative complaint seeks, in relevant part, unspecified monetary
damages and rescission of the merger. On December 2, 2011,
plaintiffs filed a consolidated amended complaint, which similarly
alleges that the Primedia board members, KKR, and certain KKR
affiliates breached their respective fiduciary duties by entering
into the merger agreement at an unfair price in light of the value
of the dismissed shareholder derivative claims. That amended
complaint seeks an unspecified amount of monetary damages.
On January 31, 2012, defendants moved to dismiss the amended
complaint. The motion to dismiss the amended complaint is pending
before the Court of Chancery.
Additionally, in May 2011, two shareholder class actions
challenging the Primedia merger were filed in Georgia state
courts, asserting similar allegations and seeking similar relief
as initially sought by the Delaware shareholder class actions
above. Both Georgia actions have been stayed in favor of the
Delaware action.
KKR & CO: Renews Summary Judgment Bid in Mass. Antitrust Suit
-------------------------------------------------------------
KKR & Co. L.P. filed a renewed motion for summary judgment after
the court narrowed plaintiffs' claim in an antitrust suit filed
against it in the United States District Court for the District of
Massachusetts, the company disclosed on its May 2, 2013, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2013.
In December 2007, KKR, along with 15 other private equity firms
and investment banks, were named as defendants in a purported
class action complaint filed in the United States District Court
for the District of Massachusetts by shareholders in certain
public companies acquired by private equity firms since 2003. In
August 2008, KKR, along with 16 other private equity firms and
investment banks, were named as defendants in a purported
consolidated amended class action complaint.
The suit alleges that from mid-2003 defendants have violated
antitrust laws by allegedly conspiring to rig bids, restrict the
supply of private equity financing, fix the prices for target
companies at artificially low levels, and divide up an alleged
market for private equity services for leveraged buyouts. The
amended complaint seeks injunctive relief on behalf of all persons
who sold securities to any of the defendants in leveraged buyout
transactions and specifically challenges nine transactions.
The first stage of discovery concluded on or about April 15, 2010.
On August 18, 2010, the court granted plaintiffs' motion to
proceed to a second stage of discovery in part and denied it in
part. Specifically, the court granted a second stage of discovery
as to eight additional transactions but denied a second stage of
discovery as to any transactions beyond the additional eight
specified transactions.
On October 7, 2010, the plaintiffs filed under seal a fourth
amended complaint that includes new factual allegations concerning
the additional eight transactions and the original nine
transactions. The fourth amended complaint also includes eight
purported sub-classes of plaintiffs seeking unspecified monetary
damages and/or restitution with respect to eight of the original
nine challenged transactions and new separate claims against two
of the original nine challenged transactions.
On January 13, 2011, the court granted a motion filed by KKR and
certain other defendants to dismiss all claims alleged by a
putative damages sub-class in connection with the acquisition of
PanAmSat Corp. and separate claims for relief related to the
PanAmSat transaction. The second phase of discovery permitted by
the court is completed. On July 11, 2011, plaintiffs filed a
motion seeking leave to file a proposed fifth amended complaint
that seeks to challenge ten additional transactions in addition to
the transactions identified in the previous complaints. Defendants
opposed plaintiffs' motion.
On September 7, 2011, the court granted plaintiffs' motion in part
and denied it in part. Specifically, the court granted a third
stage of limited discovery as to the ten additional transactions
identified in plaintiffs' proposed fifth amended complaint but
denied plaintiffs' motion seeking leave to file a proposed fifth
amended complaint.
On June 14, 2012, following the completion of the third phase of
discovery, plaintiffs filed a fifth amended complaint which, like
their proposed fifth amended complaint, seeks to challenge ten
additional transactions in addition to the transactions identified
in the previous complaints. On June 22, 2012, defendants filed a
motion to dismiss certain claims asserted in the fifth amended
complaint. On July 18, 2012, the court granted in part and denied
in part defendants' motion to dismiss, dismissing certain
previously released claims against certain defendants.
On March 13, 2013, the United States District Court denied
defendants' motion for summary judgment on the count involving
KKR. However, the court narrowed plaintiffs' claim to an alleged
overarching agreement to refrain from jumping other defendants'
announced proprietary transactions, thereby limiting the case to a
smaller number of transactions subject to plaintiffs' claim. KKR
filed a renewed motion for summary judgment on April 16, 2013
pursuant to the court's grant of permission to re-file.
L.D. KICHLER: Recalls 48,900 Chandeliers Due to Injury Hazard
-------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
The L.D. Kichler Co., of Cleveland, Ohio, announced a voluntary
recall of about 48,900 Aztec Light Chandeliers. Consumers should
stop using this product unless otherwise instructed. It is
illegal to resell or attempt to resell a recalled consumer
product.
The chandelier's fixture loop that connects the hanging chain to
the lamp can fail during use causing the chandelier to fall from
the ceiling and injure bystanders.
Kichler Lighting has received six reports of the chandeliers
falling from the ceiling. No injuries have been reported.
Approximately $6,000 in property damage has been reported.
This recall involves Aztec nine-light chandeliers sold at Lowe's
stores under the PORTFOLIO brand name. The chandeliers are metal
with an olde bronze finish and measure about 31-inches wide and
31-inches high. They come with etched amber glass shades and a
decorative faux marble ball in the center. The upper arms of the
fixture are single long curves and the lower arms of the fixture
are "S" shaped. "Aztec" and model number 34330 are printed on a
sticker located inside the ceiling canopy at the top of the
chandelier. Pictures of the recalled products are available at:
http://is.gd/LRnBFK
The recalled products were manufactured in China and sold
exclusively at Lowe's stores nationwide and at www.lowes.com from
July 2006 through August 2011 for about $240.
Consumers should prevent people from going into the immediate area
under the chandeliers and contact Kichler for information on how
to obtain a free repair kit or replacement for chandeliers that
have fallen. Kichler Lighting's Home Center Division ("Aztec")
may be reached at (800) 554-6504, from 9:00 a.m. to 5:00 p.m.
Eastern Time Monday through Friday, or online at
http://www.kichler.com/and click on "Aztec" and then on "Model
No. 34330 Safety Information" for more information.
LENDER PROCESSING: Wants Cohen Milstein Removed From Class Action
-----------------------------------------------------------------
Daniel Fisher, writing for Forbes, reports that the Nevada Supreme
Court was scheduled on June 5 to hear a challenge over the
increasingly common -- and contentious -- practice of using
private, contingency-fee lawyers to sue companies on behalf of the
state.
Lender Processing Services wants the Nevada high court to order
the state's attorney general to remove Washington class-action
specialists Cohen Milstein from a lawsuit accusing the mortgage-
servicing firm of foreclosure abuses, saying Nevada law prohibits
the practice.
LPS has settled similar suits with AGs in 49 other states and the
District of Columbia, but says it can't negotiate fairly with
Nevada because the lawyers at Cohen Milstein can veto any
settlement that doesn't include a fee for them. Given the state
is seeking penalties that are the equivalent of fines, LPS says,
it is improper and illegal for the AG to deputize private lawyers
to pursue the action.
"Public policy requires a complete prohibition of contingency fee
arrangements because the inherently coercive nature of the action
triggers the requirement that those imbued with public power are
not permitted to act out of motivations of private gain," LPS said
in a filing with the court.
In settlements with the other states that were negotiated without
private lawyers, LPS agreed to pay a total of $127 million. Those
prior settlements may be jeopardized by the Nevada AG's contract
with Cohen Milstein, the company says, since if LPS agrees to pay
more to Nevada that will open up many of the other settlements to
renegotiation.
Cohen Milstein declined a request for comment.
Nevada Attorney General Catherine Cortez Masto hired Cohen
Milstein in 2009. According to the law firm's contract with the
state, Cohen Milstein stands to collect up to 15% of any
settlement (returning 15% of that back to the AG for "costs and
expenses"), and the state agrees that if the settlement doesn't
include cash, the defendant must pee Cohen Milstein's fees. LPS
said that clause gives the private lawyers a virtual veto over any
settlement that doesn't suit their taste, although it really only
says the state will not agree to a deal that doesn't include LPS
footing the bill for its outside lawyers.
LPS also argues Nevada law specifically prohibits the AG from
hiring private lawyers unless they are used to defend the state in
a lawsuit, or the legislature appropriates the fees to pay them.
Even in cases where outside lawyers can work for the state, they
are to be paid from a specific account that the contract with
Cohen Milstein says won't be used in the LPS action.
Corporate defendants have complained about private outside lawyers
getting a piece of public lawsuits at least since the epic Tobacco
Master Settlement of 1997, which continues to enrich the private
lawyers who negotiated it to the tune of several hundred million
dollars a year. (The National Association of Attorneys General, an
association for AGs, also got more than $100 million out of the
deal.)
Defense lawyers say it is unfair to deputize private lawyers
motivated by their own profits to sue companies on behalf of the
public, because it eliminates the prosecutorial discretion to
decide which cases are worth pursuing and how much to seek.
They've had mixed success challenging such contracts, however.
The tobacco settlement yielded a multibillion-dollar payday for
politically connected lawyers including Mississippi's Dickie
Scruggs, who contributed heavily to the political campaigns of the
man who hired him and later went to jail for attempted bribery.
The U.S. Chamber helped lobby 13 states into passing laws
restricting the use of private lawyers, Reuters reports. And the
California Supreme Court in 2010 rejected contingency-fee
contracts between municipalities and private lawyers because they
didn't specify that all major decisions must be made by the
government.
Late last month, a federal judge approved the Kentucky AG's use of
private lawyers to go after Merck over its marketing of Vioxx,
however. The federal judge who decided that case may have given
some support to LPS when he said he approved the contract because
it "expressly retains the AG's final authority over the decision
to settle and provides that any settlement must be expressly
approved and signed by the AG."
LEVEL 3 COMMUNICATIONS: Awaits OK for Rights-of-Way Suit Accord
---------------------------------------------------------------
Level 3 Communications, Inc. is awaiting approval of certain
settlements it entered into with current and former owners of land
near railroad rights of way in which the Company has installed its
fiber optic cable networks, according to the company's May 7,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
The Company is party to a number of purported class action
lawsuits involving its right to install fiber optic cable network
in railroad right-of-ways adjacent to plaintiffs' land.
In general, the Company obtained the rights to construct its
networks from railroads, utilities, and others, and has installed
its networks along the rights-of-way so granted. Plaintiffs in the
purported class actions assert that they are the owners of lands
over which the fiber optic cable networks pass, and that the
railroads, utilities, and others who granted the Company the right
to construct and maintain its network did not have the legal
authority to do so.
The complaints seek damages on theories of trespass, unjust
enrichment and slander of title and property, as well as punitive
damages. The Company has also received, and may in the future
receive, claims and demands related to rights-of-way issues
similar to the issues in these cases that may be based on similar
or different legal theories.
The Company has defeated motions for class certification in a
number of these actions but expects that, absent settlement of
these actions, plaintiffs in the pending lawsuits will continue to
seek certification of statewide or multi-state classes. The only
lawsuit in which a class was certified against the Company, absent
an agreed upon settlement, occurred in Koyle, et. al. v. Level 3
Communications, Inc., et. al., a purported two state class action
filed in the United States District Court for the District of
Idaho. The Koyle lawsuit has been dismissed pursuant to a
settlement reached in November 2010.
The Company negotiated a series of class settlements affecting all
persons who own or owned land next to or near railroad rights of
way in which it has installed its fiber optic cable networks.
The United States District Court for the District of Massachusetts
in Kingsborough v. Sprint Communications Co. L.P. granted
preliminary approval of the proposed settlement; however, on
September 10, 2009, the court denied a motion for final approval
of the settlement on the basis that the court lacked subject
matter jurisdiction and dismissed the case.
In November 2010, the Company negotiated revised settlement terms
for a series of state class settlements affecting all persons who
own or owned land next to or near railroad rights of way in which
the Company has installed its fiber optic cable networks. The
Company is currently pursuing presentment of the settlement in
applicable jurisdictions.
The settlements, affecting current and former landowners, have
received final federal court approval in multiple states and the
parties are engaged in the claims process for those states. The
settlement has also been presented to federal courts in additional
states and approval is pending.
MERGE HEALTHCARE: Insurer Appeals Award of Coverage in Stock Suit
-----------------------------------------------------------------
An appeal by Merge Healthcare Incorporated's insurer from a
summary judgment remains pending, according to the Company's
May 1, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2013.
In January and February 2010, purported stockholder class action
complaints were filed in the Superior Court of Suffolk County,
Massachusetts in connection with AMICAS Inc.'s (AMICAS) proposed
acquisition by a third party. In March 2010, because AMICAS had
terminated the merger agreement with that third party and agreed
to be acquired by Merge, the Court dismissed the plaintiffs'
claims as moot.
Subsequently, plaintiffs' counsel filed an application for
approximately $5,000 of attorneys' fees. AMICAS opposed the fee
petition, tendered the defense to its insurers that provided
coverage against such claims and retained litigation counsel to
defend the matter. On December 4, 2010, the Massachusetts court
awarded plaintiffs approximately $3,200 in attorneys' fees and
costs. AMICAS appealed this judgment to the Massachusetts Court
of Appeals.
After receipt of the Massachusetts court's attorneys' fee award
decision, AMICAS's insurer denied policy coverage for
approximately $2,500 of the fee award and filed a declaratory
judgment action to that effect against AMICAS and Merge in Federal
court for the Northern District of Illinois.
The company contested the insurer's denial of coverage, asserted
its rights under the applicable insurance policies and filed a
counterclaim against the insurer seeking full payment of the
Massachusetts court's fee award, plus additional damages. On
April 30, 2012, the Illinois Federal court ruled in favor of the
company's motion for summary judgment, which decision was appealed
by the insurer to the United States Seventh Circuit Court of
Appeals.
That appeal, which has been briefed and argued by the parties, is
pending. In late February, 2013, the insurer settled the
Massachusetts court case by agreeing to pay $2,990 to plaintiffs'
counsel and further agreeing not to pursue AMICAS or Merge for any
portion of the amount paid.
The company believes that the Massachusetts settlement has
rendered moot the Seventh Circuit appeal, except for the insurer's
claim to reimbursement for a portion of the fees it advanced in
the Massachusetts appeal, which the company believes is less than
$150 and with respect to Merge's claims for additional damages
from the insurer. As a result of the Massachusetts settlement,
Merge recognized a gain of $2,500 within general and
administrative in our statement of operations with respect to
these matters in the first quarter of 2013 based on the February
27, 2013 appellate court dismissal date.
NARCONON: Parents of Former Patients File Fraud Class Action
------------------------------------------------------------
Christian Boone, writing for The Atlanta Journal-Constitution,
reports that the parents of five former Narconon of Georgia
patients on June 4 filed a lawsuit seeking class action against
the Norcross drug treatment center alleging fraud, negligence and
breach of contract, among other claims.
The suit is just the latest in a string of state and civil actions
against the Church of Scientology-affiliated clinic. In the past
six months, Narconon of Georgia has lost its state-issued
operating license, settled a wrongful death suit for an
undisclosed sum and been hit with allegations of insurance fraud.
The June 4 filing also names Narconon International, based in Los
Angeles, and the organization's parent company, the Religious
Technology Center which, according to the complaint, "serves as
the final arbiter and enforcer of orthodoxy for all Scientology-
related activities and organizations" and also licenses the
"technology" used by Narconon.
"As we contend, Narconon of Georgia was a racketeering enterprise,
and any company that benefits from Narconon of Georgia, no matter
how far upstream they go, is a potential racketeering defendant,"
said attorney Jeff Harris, who filed the suit in Gwinnett County
state court.
Narconon of Georgia's attorney, Brian McEvoy, refuted the
allegations, saying the suit lacks merit "and is simply an attempt
to obtain money from a non-profit dedicated to helping address
this nation's drug epidemic."
In a statement, Narconon said its program has "transformed and
saved lives through recovery and sobriety," adding it has "served
the Atlanta community for the past decade offering drug education,
prevention and rehabilitation services."
The plaintiffs in the suit say they were duped by Narconon on
everything from its claim that 70 percent of patients kick drugs
to its connection to Scientology. They also allege Narconon of
Georgia misrepresented itself as a residential treatment clinic, a
charge that led the state Department of Community Health to revoke
its license in December.
Narconon, which remains open pending its appeal of the DCH ruling,
is also the target of an investigation by Gwinnett District
Attorney Danny Porter, who recently executed search warrants at
the Norcross facility. Affidavits used to obtain the warrants
allege insurance fraud totaling nearly $3 million.
"A lot of these families scraped together all the money that they
had in order to put their children into drug rehab facilities that
they believed were legitimate and they lost it all, some lost even
more than that, some of them are still paying for this program
years later," Mr. Harris said.
One of those families, Ben and Rhonda Burgess, of Watkinsville,
say Narconon, acting without permission, opened several credit
cards in their names and charged $19,000. The couple say the
debts forced them to sell their house and move into a mobile home.
Mike and Terri Dacy, also named as plaintiffs, allege Narconon
charged approximately $10,300 on credit cards that were opened in
their name without authorization, according to the suit.
According to WBSTV's Jodie Fleischer, Mr. Harris has launched a
website to inform current and former patients and their families
about the case. It also includes an application to sign up as a
plaintiff in the class action. He expects to see similar class
action cases form in other states.
"I do believe that it will go beyond Georgia because there are a
number of Narconon centers across the country that are doing the
exact same thing. They make the exact same misrepresentations
about the sauna and the success rate and really about the program
itself," said Mr. Harris.
Investigation
WBSTV reports that the former executive director of Georgia's
program resigned in January. The center is currently awaiting a
hearing after appealing a state effort to revoke its license.
According to WBSTV, last month, state insurance fraud
investigators executed search warrants at Narconon and hauled away
two dozen computers and hard drives, and boxes of financial and
medical records. They're working with Gwinnett County District
Attorney Danny Porter to see if criminal charges are warranted.
NEOMAGNETIC GADGETS: Recalls Cube and Buckyballs Magnetic Sets
--------------------------------------------------------------
Starting date: June 20, 2013
Posting date: June 20, 2013
Type of communication: Consumer Product Recall
Subcategory: Household Items, Toys
Source of recall: Health Canada
Issue: Product Safety, Unauthorized products
Audience: General Public
Identification number: RA-34263
Affected products: NeoMagnetic Cube and Buckyballs magnetic sets
The present recall involves small powerful magnetic balls that can
be used to build sculptures, puzzles, patterns, or shapes
including any of the following brands:
* NeoMagnetic Cube 5mm RED COPPER
* NeoMagnetic Cube 5mm BLUE METAL
* NeoMagnetic Cube 5mm DARK
* NeoMagnetic Cube 5mm TRIPLE NICKEL
* NeoMagnetic Cube 5mm SILVER
* NeoMagnetic Cube 5mm GOLD
* NeoMagnetic Cube 5mm Metallic Rainbow Glazed Spheres
* NeoMagnetic Cube 5mm Metallic Glazed Spheres
* NeoMagnetic Square 125
* NeoMagnetic Square 216
* NeoMagnetic Cube 6mm BLUE METAL
* NeoMagnetic Cube 6mm DARK
* NeoMagnetic Cube 6mm GOLD
* NeoMagnetic Cube 6mm TRIPLE NICKEL
* Buckyballs Original
* Buckyballs Sidekick
* Buckyballs Book Edition
Pictures of the recalled products are available at:
http://is.gd/R5aGIP
Health Canada has ordered NeoMagnetic Gadgets Inc. to recall these
products from the market.
The risk assessment on these magnet sets has informed Health
Canada's determination that they are a danger to human health and
safety because they contain small powerful magnets which can be
easily swallowed or inhaled by children. Unlike other small
objects that would be more likely to pass normally through the
digestive system if swallowed, when more than one small powerful
magnet is swallowed, the magnets can attract one another while
travelling through the digestive system. The magnets can then
pinch together and create a blockage and slowly tear through the
intestinal walls, causing perforations.
The results of swallowing small powerful magnets can be very
serious and life-threatening. Swallowing incidents have often
resulted in considerable damage to the gastrointestinal tissues
and required emergency surgical treatment. For survivors, there
can be serious long-term health consequences.
For more information on the danger of swallowing magnets, please
see Magnets [http://is.gd/kdS3Y0].
Approximately 4,000 of the affected products were sold in Canada.
The recalled products were sold from February 2010 to June 2013.
Companies:
Distributor NeoMagnetic Gadgets Inc.
4030 St-Ambroise Suite 234
Montreal
H4C 2C7
Quebec, CANADA
Consumers should stop using the recalled magnet sets immediately
and contact their municipality for instructions on how to dispose
of or recycle the recalled products.
Please note that the Canada Consumer Product Safety Act prohibits
recalled products from being redistributed, sold or even given
away in Canada.
NEW YORK, NY: On-Body Recording Systems Better for Police
---------------------------------------------------------
Scott Greenwood and Tom Streicher, writing for New York Daily
News, report that near the conclusion of the recent class-action
trial over the New York Police Department's practice of stopping,
questioning and frisking people, Judge Shira Scheindlin declared
herself "intrigued" by the concept of putting wearable cameras on
officers, saying "it seems it would solve a lot of problems."
These cameras, the judge suggested, could monitor interactions
between cops and citizens, especially minority-group members
alleged to be mistreated by the stop-and-frisk policy.
Whatever your opinion of the lawsuit, Judge Scheindlin has hit
upon an excellent idea. In fact, rather than waiting for courts
or legislators to impose this technology, then grousing about the
top-down nature of such an order, the NYPD should embrace and
deploy it on its own volition -- and soon.
On-body recording systems, as they're known, are better for law
enforcement professionals, better for civil libertarians and
better for those who complain of police abuse. They should be
rolled out not just in a limited pilot, but broadly.
Begin with this undeniable fact: Thanks to smartphones and
pervasive surveillance technology like the Ring of Steel in lower
Manhattan, cameras are already in millions of pockets and on
thousands of streetcorners. As recently as last week, Police
Commissioner Raymond Kelly argued for more closed-circuit "smart
cameras," capable of alerting cops to the presence of suspicious
packages, to be installed. "In my opinion, you can't have enough
of them," said the commissioner about cameras.
All this means, like it or not, that countless police-community
interactions are already captured on some combination of
government, third-party or bystander photography or video.
The one missing piece? Video and audio capability on officers
themselves, with the ability to capture complex, unfolding
situations from their point of view, where -- for the purpose of
judging the appropriateness of police actions and the potential
criminal behavior of a suspect -- it matters most.
For years, it was the stuff of science fiction to imagine
unobtrusive, relatively inexpensive devices on every cop. Not
anymore. Civilians are starting to wear Google Glass, and there
are similar, rugged, high-quality police cameras that law
enforcement can wear around the clock.
Here's how they typically work. Police wear glasses with an
attached camera that captures what's in their field of vision.
And every time they initiate an interaction with a member of the
public, they start capturing images and sound.
That information then gets uploaded to a central computer system
or a secure cloud, where it can be reviewed by superiors -- or, in
the case of a dispute about a particular interaction, by a judge
or jury.
Do details need to be worked out? Yes. When a police officer is
in a private space, like an apartment, it's important that he or
she not upload video to YouTube or release it to the press in
violation of the suspect's privacy.
And surely, civil liberties controls will have to be put in place
when on-body police cameras are capable of using face-recognition
technology, a la "RoboCop" or "Terminator."
But for now, cameras on cops are invaluable. In Albuquerque, N.M.,
more than 1,000 cops are outfitted with the devices. Salt Lake
City, Seattle, Phoenix and Oakland, Calif., are trying the
technology, too.
Imagine how this could change the stop-and-frisk conversation in
New York.
If officers misuse force or interact with the public in an illegal
or discourteous manner, the authorities will have the minute-by-
minute account of what happened -- allowing police supervisors and
accountability proponents to provide oversight. And rather than
seeing it from a subjective or odd angle, it'll be from the single
most important perspective: the cop's.
More importantly, the use of on-cop cameras would decrease even
the possibility of misconduct on the part of both officers and
those they interact with, because everyone will know that the
truth will be recorded. Games of "he said, he said" will be a
thing of the past.
In the first controlled study of the impact of these cameras in
Rialto, Calif., researchers found that they reduced complaints
about officers dramatically ? and cut down the use of police
force.
This results in fewer lawsuits, decreased liability to taxpayers,
a better relationship with the community and restored legitimacy
for the police. The officers of the NYPD -- and the people of New
York -- deserve no less.
OGDEN CAP: Plaintiffs to Drop Renters & Owners From Class Action
----------------------------------------------------------------
Zachary Kussin, writing for The Real Deal, reports that three
young Manhattanites who sued landlords over Hurricane Sandy-
related housing issues moved on June 3 to curtail a proposed class
action by dropping the renters and owners of co-ops from the suit.
The three residents first filed the proposed class action in
January. Briana Adler, Lauren Schoenfeld and Perri Steiner allege
that they and all tenants across the state should receive rent
reimbursements for the amount of time their homes were without
electricity, hot water, heat or functional elevators following the
late October storm.
The three renters would eliminate co-ops from the class, in part,
"to adhere more tightly to the standing of our class
representatives (each of whom is a renter) and enhance the
likelihood of the certifiability of the class," Barbara Hart of
Lowey Dannenberg Cohen & Hart, an attorney for the plaintiffs,
told The Real Deal.
The motion, filed in the New York State Supreme Court, comes in
response to a motion from the initial defendants -- including
Ogden Cap Properties and the estate of Sol Goldman -- to toss the
class action. They argued that the proposed plaintiff and
defendant classes -- every tenant and landlord across the state --
were not only improper, but also that some of the initial
plaintiffs lacked the standing to bring the suit.
The plaintiffs addressed some of those concerns in the June 3
motion, naming Matel Realty LLC, an affiliate of initial defendant
Tres Realty LLC and the owner of 151 East 31st Street, the
building where Adler lives, in the suit.
Ogden, Matel, Tres and the estate of Sol Goldman did not
immediately respond to requests seeking comment.
"This action is an egregious example of an abuse of the class
action process as a procedural mechanism," Mara Levin, an attorney
with Herrick, Feinstein LLP who represents the defendants, told
The Real Deal, referring to the plaintiffs' motion. "It was
incumbent upon plaintiffs to come forward with a legal basis upon
which the class action could be sustained, and they failed to do
so."
The plaintiffs are still months away from officially filing their
motion for class certification, according to court papers.
Class action is the only mechanism to deal with the issues at
hand, since landlords could harass or retaliate against tenants
who file solo suits, the plaintiffs contend.
"Class certification is particularly appropriate here, where the
vast majority -- if not all -- of the class members have sustained
damages in amounts insufficient to justify individual lawsuits,"
the plaintiffs' motion said.
PADDYWAX LLC: Recalls 2,100 Fragrance Diffusers Due to Labeling
---------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Paddywax LLC, of Franklin, Tennessee, announced a voluntary recall
of about 2,100 Paddywax Fragrance Diffusers. Consumers should
stop using this product unless otherwise instructed. It is
illegal to resell or attempt to resell a recalled consumer
product.
The label on the diffusers violates the Federal Hazardous
Substances Act (FHSA) by omitting the presence of petroleum
distillates. Petroleum distillates pose an aspiration hazard if
swallowed.
No incidents or injuries have been reported.
The recall includes ECO and RELISH Paddywax diffusers sold in
three fragrances. Fragrances include ECO Blood Orange with
Bergamot, ECO Grapefruit with Coriander and RELISH Ocean Tide with
Sea Salt. The diffusers were sold in a solid tan cylinder-shaped
container measuring about 11-inches high by 2-3/4 inch diameter.
The diffuser includes a green or blue glass vase and evaporating
diffuser sticks. "Paddywax" and the fragrance name are printed on
the front of the cylinder. Pictures of the recalled products are
available at: http://is.gd/czNhLf
The recalled products were manufactured in the United States of
America and sold at small gift shops, grocery, pharmacy, plant
nurseries and spas nationwide and online at www.Paddywax.com from
January 2013 through April 2013 for about $28.
Consumers should immediately stop using the diffusers and move out
of reach of children and pets. Contact Paddywax for instructions
on returning unopened containers and disposal of opened containers
to receive a replacement product. Paddywax may be reached toll-
free at (888) 442-3088 from 8:00 a.m. to 5:00 p.m. Central Time
Monday through Friday, e-mail at customer.service@paddywax.com or
go online at http://www.paddywax.com/and click on Recall for more
information.
PEOPLE'S UNITED: Awaits Approval of $7.25BB Deal in Suit vs. VISA
-----------------------------------------------------------------
In June 2005, a group of U.S. merchants filed a class action
lawsuit against VISA and MasterCard claiming that the way VISA and
MasterCard set interchange rates was a violation of anti-trust
laws. In July 2012, the parties signed a memorandum of
understanding to enter into a settlement to the lawsuit in which
VISA and MasterCard proposed to pay $7.25 billion to the merchants
($6.05 billion in cash and $1.2 billion from an eight month
reduction in credit card interchange). People's United Financial
Inc. says the proposed settlement is not expected to have a
significant impact on its financial results.
No further updates were reported in the Company's May 10, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
People's United Financial, Inc. -- http://www.peoples.com/-- is a
savings and loan holding company incorporated in Delaware and the
holding company for People's United Bank, a federally-chartered
stock savings bank headquartered in Bridgeport, Connecticut.
PEOPLE'S UNITED: Bank Renews Bid to Dismiss Overdraft Fee Suit
--------------------------------------------------------------
People's United Financial Inc.'s subsidiary renewed its motion to
dismiss a class action lawsuit related to overdraft fees,
according to the Company's May 10, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
People's United Bank has been named as a defendant in a lawsuit
(Marta Farb, on behalf of herself and all others similarly
situated v. People's United Bank) arising from its assessment and
collection of overdraft fees on its checking account customers.
The complaint was filed in the Superior Court of Connecticut,
Judicial District of Waterbury, on April 22, 2011, and alleges
that People's United Bank engaged in certain unfair practices in
the posting of electronic debit card transactions from highest to
lowest dollar amount. The complaint also alleges that such
practices were inadequately disclosed to customers and were
unfairly used by People's United Bank for the purpose of
generating revenue by maximizing the number of overdrafts a
customer is assessed. The complaint seeks certification of a
class of checking account holders residing in Connecticut and who
have incurred at least one overdraft fee, injunctive relief,
compensatory, punitive and treble damages, disgorgement and
restitution of overdraft fees paid, and attorneys' fees.
On June 16, 2011, People's United Bank filed a Motion to Dismiss
the Complaint, and on December 7, 2011, that motion was denied by
the court. On April 11, 2012, the plaintiff filed an amended
complaint, and on May 15, 2012, People's United Bank filed a
Motion to Strike the Amended Complaint. That motion remains
pending. Expedited discovery in this case began in July 2012.
On April 10, 2013, People's United Bank renewed its Motion to
Dismiss the Complaint.
People's United Financial, Inc. -- http://www.peoples.com/-- is a
savings and loan holding company incorporated in Delaware and the
holding company for People's United Bank, a federally-chartered
stock savings bank headquartered in Bridgeport, Connecticut.
PEOPLE'S UNITED: Plaintiffs Amended Suit vs. Smithtown in April
---------------------------------------------------------------
The plaintiffs in the consolidated securities lawsuit against a
subsidiary of People's United Financial Inc. filed a second
amended complaint in April 2013, according to the Company's
May 10, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2013.
On February 25, 2010, and March 29, 2010, Smithtown Bancorp, Inc.,
a Company subsidiary, and several of its officers and directors
were named in two lawsuits commenced in United States District
Court, Eastern District of New York (Waterford Township Police &
Fire Retirement v. Smithtown Bancorp, Inc., et al. and Yourgal v.
Smithtown Bancorp, Inc. et al., respectively) on behalf of a
putative class of all persons and entities who purchased
Smithtown's common stock between March 13, 2008, and February 1,
2010, alleging claims under Section 10(b) and Section 20(a) of the
Securities Exchange Act of 1934. The plaintiffs allege, among
other things, that Smithtown's loan loss reserve, fair value of
its assets, recognition of impaired assets and its internal and
disclosure controls were materially false, misleading or
incomplete. As a result of the merger of Smithtown with and into
People's United Financial on November 30, 2010, People's United
Financial has become the successor party to Smithtown in this
matter.
On April 26, 2010, the named plaintiff in the Waterford action
moved to consolidate its action with the Yourgal action, to have
itself appointed lead plaintiff in the consolidated action and to
obtain approval of its selection of lead counsel. The Court
approved the consolidation of the two lawsuits, with Waterford
Township named the lead plaintiff. On March 22, 2012, People's
United Financial filed a Motion to Dismiss the Complaint.
On March 29, 2013, the Court granted People's United Financial's
Motion to Dismiss. On April 30, 2013, the plaintiffs filed a
second amended complaint.
People's United Financial, Inc. -- http://www.peoples.com/-- is a
savings and loan holding company incorporated in Delaware and the
holding company for People's United Bank, a federally-chartered
stock savings bank headquartered in Bridgeport, Connecticut.
PEOPLE'S UNITED: Bank Unit Still Defends Wage and Hour Suit
-----------------------------------------------------------
People's United Bank, a subsidiary of People's United Financial
Inc., has been named as a defendant in a lawsuit (Tracy Fracasse
and K. Lee Brown, individually and on behalf of others similarly
situated v. People's United Bank) based on allegations that
People's United Bank failed to pay overtime compensation required
by (i) the federal Fair Labor Standards Act and (ii) the
Connecticut Minimum Wage Act. The plaintiffs allege that they
were employed as "underwriters" and were misclassified as exempt
employees. The plaintiffs further allege that they worked in
excess of 40 hours per week and were erroneously denied overtime
compensation as required by federal and state wage and hour laws.
The complaint was filed in the U.S. District Court of Connecticut
on May 3, 2012. Since the complaint is brought under both federal
and state law, the complaint seeks certification of two different
but overlapping classes. The plaintiffs seek damages in the
amount of their respective unpaid overtime and minimum wage
compensation, liquidated damages and interest and attorneys' fees.
On June 29, 2012, People's United Bank filed its Answer and
Affirmative Defenses.
No further updates were reported in the Company's May 10, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
People's United Financial, Inc. -- http://www.peoples.com/-- is a
savings and loan holding company incorporated in Delaware and the
holding company for People's United Bank, a federally-chartered
stock savings bank headquartered in Bridgeport, Connecticut.
PERRIGO COMPANY: Cert. Hearing for Eltroxin Suit in September
-------------------------------------------------------------
A hearing on whether or not to certify a consolidated lawsuit over
Eltroxin medicine distributed by Perrigo companies in Israel, is
scheduled for September 2013, according Perrigo Company's May 7,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 30, 2013.
During October and November 2011, nine applications to certify a
class action lawsuit were filed in various courts in Israel
related to Eltroxin, a prescription thyroid medication
manufactured by a third party and distributed in Israel by Perrigo
Israel Agencies Ltd. The respondents include Perrigo Israel
Pharmaceuticals Ltd. and/or Perrigo Israel Agencies Ltd., the
manufacturers of the product, and various health care providers
who provide health care services as part of the compulsory health
care system in Israel.
The nine applications arose from the 2011 launch of a reformulated
version of Eltroxin in Israel. The applications generally alleged
that the respondents (a) failed to timely inform patients,
pharmacists and physicians about the change in the formulation;
and (b) failed to inform physicians about the need to monitor
patients taking the new formulation in order to confirm patients
were receiving the appropriate dose of the drug. As a result,
claimants allege they incurred the following damages: (a)
purchases of product that otherwise would not have been made by
patients had they been aware of the reformulation; (b) adverse
events to some patients resulting from an imbalance of thyroid
functions that could have been avoided; and (c) harm resulting
from the patient's lack of informed consent prior to the use of
the reformulation.
All nine applications were transferred to one court in order to
determine whether to consolidate any of the nine applications. On
July 19, 2012, the court dismissed one of the applications and
ordered that the remaining eight applications be consolidated into
one application.
On September 19, 2012, a consolidated motion to certify the eight
individual motions was filed by lead counsel for the claimants.
Generally, the allegations in the consolidated motion are the same
as those set forth in the individual motions; however, the
consolidated motion excluded the manufacturer of the reformulated
Eltroxin as a respondent.
A hearing on whether or not to certify the consolidated
application is scheduled for September 2013.
PERRIGO COMPANY: Agrees to Settle "Warner" Suit for $1.787MM
------------------------------------------------------------
Perrigo Company and the Co-Lead Plaintiffs in a securities suit
reached an agreement in principle to settle the case with payment
by the Company's insurer of $1,787,000 to cover all costs of the
settlement, according to the company's May 7, 2013, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 30, 2013.
On March 11, 2009, a purported shareholder of the Company named
Michael L. Warner ("Warner") filed a lawsuit in the United States
District Court for the Southern District of New York against the
Company and certain of its officers and directors, including the
President and Chief Executive Officer, Joseph Papa, and the Chief
Financial Officer, Judy Brown, among others. The plaintiff sought
to represent a class of purchasers of the Company's common stock
during the period between November 6, 2008, and February 2, 2009.
The complaint alleged violations of Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 (the "Exchange Act").
The plaintiff generally alleged that the Company misled investors
by failing to disclose, prior to February 3, 2009, that certain
auction rate securities held by the Company, totaling
approximately $18,000 in par value (the "ARS"), had been purchased
from Lehman Brothers Holdings, Inc. ("Lehman").
The plaintiff asserted that omission of the identity of Lehman as
the seller of the ARS was material because after Lehman's
bankruptcy filing, on September 15, 2008, the Company allegedly
became unable to look to Lehman to repurchase the ARS at a price
near par value. The complaint sought unspecified damages and
unspecified equitable or injunctive relief, along with costs and
attorneys' fees.
On June 15, 2009, the Court appointed several other purported
shareholders of the Company, rather than Warner, as co-lead
plaintiffs (the "Original Co-Lead Plaintiffs"). On July 31, 2009,
these Original Co-Lead Plaintiffs filed an amended complaint. The
amended complaint dropped all claims against the individual
defendants other than Joseph Papa and Judy Brown, and added a
"control person" claim under Section 20(a) of the Exchange Act
against the members of the Company's Audit Committee.
The amended complaint asserted many of the same claims and
allegations as the original pleading. It also alleged that the
Company should have disclosed, prior to February 3, 2009, that
Lehman had provided the allegedly inflated valuation of the ARS
that the Company adopted in its Form 10-Q filing for the first
quarter of fiscal 2009, which was filed with the SEC on November
6, 2008. The amended complaint also alleged that some portion of
the write-down of the value of the ARS that the Company recognized
in the second quarter of fiscal 2009 should have been taken in the
prior quarter, immediately following Lehman's bankruptcy filing.
On September 28, 2009, the defendants filed a motion to dismiss
all claims against all defendants. On September 30, 2010, the
Court granted in part and denied in part the motion to dismiss.
The Court dismissed the "control person" claims against the
members of the Company's Audit Committee, but denied the motion to
dismiss as to the remaining claims and defendants.
On October 29, 2010, the defendants filed a new motion to dismiss
the amended complaint on the grounds that the Original Co-Lead
Plaintiffs (who were the only plaintiffs named in the amended
complaint) lacked standing to sue under the U.S. securities laws
following a then-recent decision of the United States Supreme
Court holding that Section 10(b) of the Exchange Act does not
apply extraterritorially to the claims of foreign investors who
purchased or sold securities on foreign stock exchanges.
On December 23, 2010, a purported shareholder named Harel
Insurance, Ltd. ("Harel") filed a motion to intervene as an
additional named plaintiff. On January 10, 2011, the original
plaintiff, Warner, filed a motion renewing his previously
withdrawn motion to be appointed as Lead Plaintiff to replace the
Original Co-Lead Plaintiffs.
On September 28, 2011, the Court granted defendants' renewed
motion to dismiss. The Court (i) dismissed the claims of the
Original Co-Lead Plaintiffs; (ii) ruled that any class that might
ultimately be certified could only consist of persons who
purchased their Perrigo shares on the NASDAQ market or by other
means involving transactions in the United States; (iii) granted
Harel's motion to intervene as a named plaintiff; and (iv) ruled
that Warner would also be treated as a named plaintiff.
On October 7, 2011, plaintiffs filed a second amended complaint on
behalf of both Harel and Warner, alleging the same claims as in
the amended complaint but on behalf of a purported class limited
to those who purchased Perrigo stock on the NASDAQ market or by
other means involving transactions in the United States. On
October 27, 2011, the Court approved a stipulation appointing
Harel and Warner as co-lead plaintiffs (the "Co-Lead Plaintiffs").
On November 21, 2011, the defendants answered the second amended
complaint, denying all allegations of wrongdoing and asserting
numerous defenses. On September 7, 2012, the Court, pursuant to a
stipulation, dismissed all claims against Joseph Papa and Judy
Brown.
Although the Company believes that it has meritorious defenses to
this lawsuit, the Company engaged in settlement discussions with
counsel for the Co-Lead Plaintiffs in an effort to move the matter
to a quicker resolution and avoid the costs and distractions of
protracted litigation. As a result of these discussions, the
Company and the Co-Lead Plaintiffs reached an agreement in
principle to settle the case with payment by the Company's insurer
of $1,787,000 to cover all costs of the settlement, subject to
Court approval.
On December 27, 2012, the Company and the Co-Lead Plaintiffs filed
a Stipulation of Settlement and a motion for preliminary approval
of the proposed class action settlement. On January 28, 2013, the
Court preliminarily approved the proposed class action settlement
and ordered that notice of the proposed settlement be provided to
the members of the proposed shareholder class and set a deadline
for class members either to object to the settlement or to exclude
themselves (or "opt out") of the settlement class.
The Court also scheduled a fairness hearing for May 17, 2013 to
determine whether the settlement is fair, reasonable and adequate
and thus merits final approval. There can be no assurance that the
proposed settlement will be approved by the Court.
SCOTT MIRACLE-GRO: Still Faces Suit Over Wild Bird Food Products
----------------------------------------------------------------
The Scotts Miracle-Gro Company continues to face the consolidated
suit In re Morning Song Bird Food Litigation pending in the United
States District Court for the Southern District of California,
according to the company's May 7, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 30, 2013.
In connection with the sale of wild bird food products that were
the subject of a voluntary recall in 2008, the Company has been
named as a defendant in four putative class actions filed on and
after June 27, 2012, which have now been consolidated in the
United States District Court for the Southern District of
California as In re Morning Song Bird Food Litigation, Lead Case
No. 3:12-cv-01592-JAH-RBB.
The plaintiffs allege various statutory and common law claims
associated with the Company's sale of wild bird food products and
a plea agreement entered into in previously pending government
proceedings associated with such sales. The plaintiffs seek on
behalf of themselves and various purported class members monetary
damages, restitution, injunctive relief, declaratory relief,
attorney's fees, interest and costs.
SONAE: Ordered to Insure for GBP65 Million Legal Claims
-------------------------------------------------------
Liverpool Echo reports that lawyers pursuing the UK's largest-ever
class action have secured a significant order against a 'cancer-
threat' factory requiring it to have insurance for at least GBP65
million.
Woodchip producer Sonae has been ordered to notify lawyers acting
for up to 18,000 people suing the firm over its Kirkby factory if
its insurance policy falls below GBP65 million.
The money is to cover any possible payouts should the company,
which shut the plant last year, lose the legal case.
Sonae declined to comment, but have always denied any liability or
any link between the factory and ill health.
But lawyers arguing for the claimants allege that residents living
close to the factory could have suffered long-term serious health
issues including life-threatening cancers.
The battle has now reached the High Court after solicitors feared
the company was 'asset-stripping'.
The claimants' solicitors alleged it was an attempt to try and
scupper the legal case.
The outer walls of the factory were removed and parts of the
machinery dismantled by the Portuguese-based firm.
An initial injunction imposed over the firm's assets in April was
coverted into an order which requires Sonae to notify the lawyers
for the class action if the manufacturer's insurance policy falls
below GBP65 million.
It is not yet known how much the claim against the firm will come
to in total.
Anthony Wilson, lead investigator for Camps Solicitors in
Birkenhead who act for the claimants, told the ECHO: "We saw the
factory being stripped down but we did not have confirmation they
had enough to cover the insurance.
"We understand machinery has already been sold off to foreign
companies and will find its way to other European countries.
"We were fearful the equipment was being taken out of the
jurisdiction to prevent a weighty payout in the future. This is
not about the claim culture, but defending the rights of
vulnerable people who could go on to suffer long-term illness
because of this plant."
A further hearing is expected to take place later this summer at
Manchester High Court.
Camps Solicitors have instructed a toxicologist and a chemist to
analyze the fumes coming from the plant as they believe the
burning wood was contaminated with paints and oils which could
make any emissions poisonous.
Two men died at the factory in 2010 after falling into machinery
and there were 22 serious accidents, which included fires and
chemical leaks, within the past nine years.
Helen Moss, a leading member of the community pressure group Say
Bye to Sonae, said: "The health of the local community takes
priority."
SUFFOLK BANCORP: Reaches Settlement in "Fisher" Securities Suit
---------------------------------------------------------------
Parties in a purported securities class action filed against
Suffolk Bancorp entered into an agreement to settle the case that
is pending in the U.S. District Court for the Eastern District of
New York, according to the company's May 7, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2013.
On October 20, 2011, a putative shareholder class action, James E.
Fisher v. Suffolk Bancorp, et al., No. 11 Civ. 5114 (SJ), was
filed in the U.S. District Court for the Eastern District of New
York against the Company, its former chief executive officer, and
a former chief financial officer of the Company.
The complaint alleges that the defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 by knowingly or
recklessly making false statements about, or failing to disclose
accurate information about, the Company's financial results and
condition, loan loss reserves, impaired assets, internal and
disclosure controls, and banking practices.
The complaint seeks damages in an unspecified amount on behalf of
purchasers of the Company's common stock between March 12, 2010
and August 10, 2011. On October 15, 2012, the defendants filed a
motion to dismiss the complaint. On April 8, 2013, the parties
entered into an agreement to settle the action, subject to the
approval of the court, and on April 10, 2013, the lead plaintiff
filed an unopposed motion requesting the court's preliminary
approval of the settlement. The motion remains pending.
SUNPOWER CORP: July Hearing for $19.7MM Securities Suit Accord
--------------------------------------------------------------
A final approval hearing for a $19.7 million settlement of a
consolidated securities lawsuit filed against SunPower Corporation
is currently scheduled to take place on July 3, 2013,
according to the company's May 7, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013.
Three securities class action lawsuits were filed against the
Company and certain of its current and former officers and
directors in the United States District Court for the Northern
District of California on behalf of a class consisting of those
who acquired the Company's securities from April 17, 2008 through
November 16, 2009.
The cases were consolidated as In re SunPower Securities
Litigation, Case No. CV-09-5473-RS (N.D. Cal.), and lead
plaintiffs and lead counsel were appointed on March 5, 2010. Lead
plaintiffs filed a consolidated complaint on May 28, 2010. The
actions arise from the Audit Committee's investigation
announcement on November 16, 2009 regarding certain
unsubstantiated accounting entries.
The consolidated complaint alleges that the defendants made
material misstatements and omissions concerning the Company's
financial results for 2008 and 2009, seeks an unspecified amount
of damages, and alleges violations of sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and sections 11 and 15 of the
Securities Act of 1933.
The court held a hearing on the defendants' motions to dismiss the
consolidated complaint on November 4, 2010. The court dismissed
the consolidated complaint with leave to amend on March 1, 2011.
An amended complaint was filed on April 18, 2011. The amended
complaint added two former employees of the Company as defendants.
Defendants filed motions to dismiss the amended complaint on May
23, 2011.
The motions to dismiss the amended complaint were heard by the
court on August 11, 2011. On December 19, 2011, the court granted
in part and denied in part the motions to dismiss, dismissing the
claims brought pursuant to sections 11 and 15 of the Securities
Act of 1933 and the claims brought against the two newly added
former employees.
On December 14, 2012, the Company announced that it reached an
agreement in principle to settle the consolidated securities class
action lawsuit for $19.7 million. The Company recorded a charge in
its fiscal fourth quarter of 2012 in the same amount which is
further classified within "Accrued liabilities" on the Company's
Condensed Consolidated Balance Sheets as of December 30, 2012. On
February 1, 2013, the parties filed a stipulation of settlement
and a motion for preliminary approval of the settlement.
The court entered an order preliminarily approving the settlement
on March 25, 2013. The settlement is subject to certain
conditions, including final approval by the court after members of
the proposed settlement class receive notice and an opportunity to
be heard. The final approval hearing is currently scheduled to
take place on July 3, 2013. Until the conditions to the settlement
have been satisfied, there can be no assurance that the settlement
will become final. If the settlement does not become final, the
Company believes it has meritorious defenses to these allegations
and will vigorously defend itself in these matters.
TASTY TREAT: Recalls Oskri Chocolate Bars Over Undeclared Milk
--------------------------------------------------------------
Starting date: June 20, 2013
Type of communication: Recall
Alert sub-type: Allergy Alert
Subcategory: Allergen - Milk
Hazard classification: Class 1
Source of recall: Canadian Food Inspection Agency
Recalling firm: Tasty Treat Foods Ltd.
Distribution: Alberta, British Columbia, Manitoba,
Ontario, Quebec, Saskatchewan, Yukon,
May be National
Extent of the product
distribution: Retail
The Canadian Food Inspection Agency (CFIA) and Tasty Treat Foods
Ltd. are warning people with allergies to milk not to consume the
Oskri brand dark chocolate bars. The affected products may
contain milk which is not declared on the label.
These products are known to have been distributed in Alberta,
British Columbia, Manitoba, Ontario, Quebec, Saskatchewan and
Yukon and may have been distributed in other provinces or
territories as well.
There have been no reported illnesses associated with the
consumption of these products.
Consumption of these products may cause a serious or life-
threatening reaction in persons with allergies to milk.
The importer, Tasty Treat Foods Ltd., Langley, BC, is voluntarily
recalling the affected products from the marketplace. The CFIA is
monitoring the effectiveness of the recall.
Affected products:
Brand
name Common name Size UPC
---- ----------- ---- ---------------
Oskri Coconut Bar 53 g 6 66016 30070 3
Dark Chocolate
Expiry dates: 7/7/14 to 12/12/14
Oskri Fig Dark 53 g 6 66016 30030 7
Chocolate Bar
Expiry dates: 7/7/14 to 12/12/14
Pictures of the recalled products' labels are available at:
http://is.gd/Bwj3eB
TRUNKBOW INTERNATIONAL: Faces Suits Over Executives' Stock Buy
--------------------------------------------------------------
Trunkbow International Holdings Limited faces two lawsuits in
Nevada in relation to the acquisition by the chairman of its board
of directors and chief executive officer of all of the outstanding
shares of the Company's common stock not owned by them, according
to the Company's May 2, 2013, Form 10-K filing with the U.S.
Securities and Exchange Commission for the year ended Dec. 31,
2013.
On November 8, 2012, a putative class action lawsuit was filed by
a purported Trunkbow shareholder in District Court, Clark County,
Nevada, captioned Hansen v. Trunkbow, et al., Case No. A-12-
671652-C.
The complaint named as defendants several directors and officers
of Trunkbow, namely, Wanchun Hou, Qiang Li, Jihong Bao, Xin Wang,
Albert Liu, Regis Kwong, Kokhui Tan, Iris Geng, Tingjie Lv,
Zhaoxing Huang and Dong Li. Although Trunkbow was included among
the defendants listed in the caption, the complaint did not assert
a cause of action against the Company.
The plaintiff in Hansen seeks recovery on behalf of all Trunkbow
shareholders for alleged breaches of fiduciary duties by the
Individual Defendants in connection with the Proposed Transaction
in which the Chairman of Trunkbow's Board of Directors, Wanchun
Hou, and Trunkbow's CEO, Qiang Li, have offered to acquire all of
the outstanding shares of the Company's common stock not currently
owned by them.
On November 14, 2012, another putative class action lawsuit was
filed by a purported Trunkbow shareholder in District Court, Clark
County, Nevada, captioned Robert Davis v. Hou, et al., Case No. A-
12-671946-C. Trunkbow is named as a defendant in this action,
along with each of the Individual Defendants named in the Hanson
complaint.
The plaintiff in Davis seeks recovery on behalf of all Trunkbow
shareholders for alleged breaches of fiduciary duties by the
Individual Defendants in connection with the Proposed Transaction,
and for aiding and abetting such alleged breaches by Trunkbow. The
plaintiffs in both cases allege that the share price proposed by
Hou and Li is inadequate in light of the Company's intrinsic value
and anticipated future growth.
Among other things, the plaintiffs in both actions seek to enjoin
the Proposed Transaction until such time as the Individual
Defendants have acted in accordance with their fiduciary duties.
Only the Company has been served in the actions, but it need not
respond to the complaints until after a transaction agreement has
been signed, if that occurs, and an amended complaint has been
filed.
UNIT CORPORATION: Smaller Class Proposed for Suit v. Subsidiary
---------------------------------------------------------------
Plaintiffs in the suit, Panola Independent School District No. 4,
et al. v. Unit Petroleum Company filed a second request to certify
a smaller class of royalty owners in oil and gas drilling and
spacing units, according to Unit Corporation's May 7, 2013, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended March 31, 2013.
Panola Independent School District No. 4, Michael Kilpatrick, Gwen
Grego, Carla Lessel, Thelma Christine Pate, Juanita Golightly,
Melody Culberson and Charlotte Abernathy are the Plaintiffs in
this case and are royalty owners in oil and gas drilling and
spacing units for which the company's exploration segment
distributes royalty.
The Plaintiffs' central allegation is that the company's
exploration segment has underpaid royalty obligations by deducting
post-production costs or marketing related fees. Plaintiffs sought
to pursue the case as a class action on behalf of persons who
receive royalty from the company for the company's Oklahoma
production.
The company stated: "We asserted several defenses including that
the deductions are permitted under Oklahoma law. We also asserted
that the case should not be tried as a class action due to the
materially different circumstances that determine what, if any,
deductions are taken for each lease."
On December 16, 2009, the trial court entered its order certifying
the class. On May 11, 2012, the Court of Civil Appeals reversed
the trial court's order certifying the class. The Plaintiffs
petitioned the Oklahoma Supreme Court for certiorari and on
October 8, 2012, the Plaintiff's petition was denied. The
Plaintiffs recently filed a second request to certify a class of
royalty owners that is slightly smaller than their first attempt.
The company says it will continue to resist certification using
the defenses described, as well as new defenses based on the Court
of Civil Appeals' decertification of the Plaintiffs' original
class action. The merits of Plaintiffs' claims will remain stayed
while class certification issues are pending.
VOLKSWAGEN: Sudden Deceleration Misdiagnosed, Plaintiff Says
------------------------------------------------------------
Joshua Dowling, writing for News Limited, reports that the man
leading a class action against German car maker Volkswagen in
Australia says claims of "sudden deceleration" at the center of a
media storm are being misdiagnosed.
"In most cases it's not sudden deceleration," says Volkswagen
owner Steve Makris. Instead it is a well-known engine shudder on
selected models that makes the car idle rough on start up or
"develop a cough" when under load, such as moving from rest or
uphill.
However Mr. Makris believes the engine shudder problem is still a
safety concern for customers.
"It might not be deceleration, but it's still a safety issue in my
opinion," Mr. Makris said. "We're talking about a split second
delay in power and that can leave you stranded across an
intersection in the path of oncoming traffic, which is exactly
what happened to me."
The Melbourne-based businessman is planning legal action after
being contacted by almost 200 disgruntled Volkswagen owners across
Australia whose cars have experienced problems with their twin-
charge (turbocharged and supercharged) 1.4-litre four-cylinder
petrol engines known as the 118TSI, and automated twin-clutch DSG
gearboxes. Most complainants have had engines and gearboxes
replaced at least once.
The law firm Mr. Makris had been working with for two months
dropped the case this morning and he is now preparing to appoint
new legal representatives.
Mr. Makris says most customers have complained about a lack of
confidence in the vehicle, the inconvenience of having their cars
being off the road for several weeks at a time during repairs, and
are concerned about the damage to their car's resale value.
Of the almost 200 Volkswagen owners on his records only "two or
three" specifically complained of deceleration.
News Limited also contacted several Volkswagen customers and asked
for any evidence of sudden deceleration, which had been linked as
a possible contributing factor in the death of a Volkswagen Golf
driver in Melbourne in 2011.
The coroner is preparing a report into the fatality, in which a
truck crashed into the rear of a Golf after it appeared to lose
speed. The findings will be handed down next month.
All Volkswagen owners contacted by News Limited who complained of
"sudden deceleration" described engine shudder on start-up, and
that it sometimes occurred when driving away from traffic lights.
In one example News Limited was told the engine shudder developed
when driving uphill and the car slowed gradually.
Volkswagen has been making repairs to this engine since 2010, when
it started a "field service campaign" in Australia for a faulty
knock sensor, and which could lead to "shuddering" or complete
engine failures.
Volkswagen called back to dealers almost 7800 Golf hatches and
Jetta sedans to have the faulty sensors fixed. The company says
"99 per cent" of that batch of vehicles equipped with the 118TSI
engine -- built between 2009 and 2011 -- have been repaired.
Volkswagen made running changes to subsequent models introduced
with the 118TSI engine, but it no longer uses this type of engine
in the latest Golf.
The car involved in the fatal crash in Melbourne in February 2011
did not have the engine at the center of the "shudder" problems.
It was a Golf GTI performance model powered by a 2.0-litre
turbocharged engine, matched with a manual gearbox rather than a
DSG.
Volkswagen Australia spokesman Karl Gehling told News Limited the
company would not comment further on the case before the coroner.
Volkswagen has repeated earlier invitations for concerned
customers to contact the company on 1800 607 822.
"We take all customer concerns seriously and if anyone may have
experienced any problems with their vehicle we recommend they
report these issues to their nearest Volkswagen dealer," the
spokesman said.
WEBMD HEALTH: Awaits Next Move of Securities Suit Plaintiffs
------------------------------------------------------------
WebMD Health Corp. is waiting for the plaintiffs' next move after
the dismissal of their lawsuit styled In re WebMD Health Corp.
Securities Litigation, according to the Company's May 10, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
Shareholder lawsuits were filed in federal and state court in New
York. The lawsuits relate to certain forward-looking information
made publicly available by the Company.
On August 2, 2011, and August 26, 2011, federal securities class
action complaints entitled Canson v. WebMD Health Corp., et al.,
and Malland v. WebMD Health Corp., et al., respectively, were
filed in the United States District Court for the Southern
District of New York on behalf of purchasers of the Company's
Common Stock between February 23, 2011, and July 15, 2011. On
November 7, 2011, the two cases were consolidated under the
caption In re WebMD Health Corp. Securities Litigation (the
"Federal Securities Action") and lead plaintiffs and lead counsel
were appointed. On February 14, 2012, the lead plaintiffs filed
their consolidated amended complaint (the "Complaint"), which
alleges claims on behalf of purchasers of the Company's securities
between February 23, 2011, and January 10, 2012. The Complaint
alleges that the Company, and certain of its officers, made false
and misleading statements in violation of the Securities Exchange
Act of 1934 and seeks unspecified damages and costs. The
defendants moved to dismiss the Complaint and the lead plaintiffs
opposed that motion. The motion was fully submitted and filed on
August 2, 2012. On November 8, 2012, the Court heard oral
argument on the defendants' motion to dismiss.
On January 2, 2013, the Court issued an opinion and order (the
"Opinion and Order") dismissing all claims asserted in the
Complaint, but granted the lead plaintiffs leave to replead within
sixty days. On March 5, 2013, the Court granted the lead
plaintiffs' request for an extension of time, until April 3, 2013,
to file a second amended complaint. The lead plaintiffs did not
file a second amended complaint and the Opinion and Order was
entered as a final judgment on April 9, 2013. The deadline for
lead plaintiffs to file a notice of appeal was May 9, 2013.
WebMD Health Corp. -- http://www.WebMD.com/-- is a Delaware
corporation based in New York. The Company is a provider of
health information services to consumers, physicians and other
healthcare professionals, employers and health plans through its
public and private online portals, mobile platforms and health-
focused publications.
WPX ENERGY: Royalty Interest Owners Sue for $20MM in Colorado
-------------------------------------------------------------
Plaintiffs who are oil and gas royalty interest owners have
claimed damages of approximately $20 million plus interest in a
suit filed against WPX Energy, Inc. in Colorado, according to the
Company's May 2, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended March 31, 2013.
In September 2006, royalty interest owners in Garfield County,
Colorado, filed a class action suit in District Court, Garfield
County, Colorado, alleging we improperly calculated oil and gas
royalty payments, failed to account for proceeds received from the
sale of natural gas and extracted products, improperly charged
certain expenses and failed to refund amounts withheld in excess
of ad valorem tax obligations.
Plaintiffs sought to certify a class of royalty interest owners,
recover underpayment of royalties and obtain corrected payments
related to calculation errors. The company entered into a final
partial settlement agreement. The partial settlement agreement
defined the class for certification, resolved claims relating to
past calculation of royalty and overriding royalty payments,
established certain rules to govern future royalty and overriding
royalty payments, resolved claims related to past withholding for
ad valorem tax payments, established a procedure for refunds of
any such excess withholding in the future, and reserved two claims
for court resolution.
The company disclosed: "We have prevailed at the trial court and
all levels of appeal on the first reserved claim regarding whether
we are allowed to deduct mainline pipeline transportation costs
pursuant to certain lease agreements. The remaining claim is
whether we are required to have proportionately increased the
value of natural gas by transporting that gas on mainline
transmission lines and, if required, whether we did so and are
entitled to deduct a proportionate share of transportation costs
in calculating royalty payments."
"We anticipate litigating the second reserved claim in 2013.
Plaintiffs have claimed damages of approximately $20 million plus
interest. However, we believe our royalty calculations have been
properly determined in accordance with the appropriate contractual
arrangements and Colorado law."
WPX ENERGY: Suit by N.M., Colo. Royalty Owners Continues
--------------------------------------------------------
WPX Energy, Inc. continues to face a suit in the United States
District Court for New Mexico, according to the Company's May 2,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013. The case was
originally filed by hydrocarbon royalty interest owners in New
Mexico and Colorado in the County of Rio Arriba, New Mexico.
In October 2011, a potential class of royalty interest owners in
New Mexico and Colorado filed a complaint against us in the County
of Rio Arriba, New Mexico. The complaint alleges failure to pay
royalty on hydrocarbons including drip condensate, fraud and
misstatement of the value of gas and affiliated sales, breach of
duty to market hydrocarbons, violation of the New Mexico Oil and
Gas Proceeds Payment Act, bad faith breach of contract and unjust
enrichment.
Plaintiffs seek monetary damages and a declaratory judgment
enjoining activities relating to production, payments and future
reporting. This matter has been removed to the United States
District Court for New Mexico.
WPX ENERGY: Faces Claims by N.M., Col. Mineral Interest Owners
--------------------------------------------------------------
In August 2012, a second potential class action was filed against
WPX Energy, Inc. in the United States District Court for the
District of New Mexico by mineral interest owners in New Mexico
and Colorado.
Plaintiffs claim breach of contract, breach of the covenant of
good faith and fair dealing, breach of implied duty to market both
in Colorado and New Mexico, violation of the New Mexico Oil and
Gas Proceeds Payment Act and seek declaratory judgment, accounting
and injunction.
At this time, the company said it believes that its royalty
calculations have been properly determined in accordance with the
appropriate contractual arrangements and applicable laws. It does
not have sufficient information to calculate an estimated range of
exposure related to these claims, according to the Company's May
2, 2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
WPX ENERGY: Accused of Violating Wyoming Royalty Payment Act
------------------------------------------------------------
In February 2013, a potential class of royalty owners filed suit
against WPX Energy Inc. in Campbell County District Court,
Wyoming, alleging violations of the Wyoming Royalty Payment Act by
failing to properly and timely pay and report royalty and
overriding royalty.
Plaintiffs seek monetary damages, interest and penalties, and
declaratory and injunctive relief. The case has been removed to
Federal Court. At this time, the company said it does not have a
sufficient basis to calculate an estimated range of exposure
related to this claim, according to the Company's May 2, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2013.
WPX ENERGY: Continues to Face Suit by Natural Gas Purchasers
------------------------------------------------------------
WPX Energy Inc. is currently a defendant in class action
litigation and other litigation originally filed in state court in
Colorado, Kansas, Missouri and Wisconsin and brought on behalf of
direct and indirect purchasers of natural gas in those states,
according to the Company's May 2, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended
March 31, 2013. Civil suits based on allegations of manipulating
published gas price indices have been brought against the company
and others, seeking unspecified amounts of damages.
These cases were transferred to the federal court in Nevada. In
2008, the court granted summary judgment in the Colorado case in
favor of the company and most of the other defendants based on
plaintiffs' lack of standing.
On January 8, 2009, the court denied the plaintiffs' request for
reconsideration of the Colorado dismissal and entered judgment in
the company's favor. When a final order is entered against the one
remaining defendant, the Colorado plaintiffs may appeal the order.
WPX ENERGY: Plaintiffs in Nev. Lawsuit Pursue Certification
-----------------------------------------------------------
Plaintiffs in a suit filed over WPX Energy Inc.'s natural gas
transactions in Nevada have appealed a denial of a certification
of a class in the suit to the United States Court of Appeals for
the Ninth Circuit, according to the Company's May 2, 2013, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended March 31, 2013.
On July 18, 2011, the Nevada district court granted the company's
joint motions for summary judgment to preclude the plaintiffs'
state law claims because the federal Natural Gas Act gives the
Federal Energy Regulatory Commission exclusive jurisdiction to
resolve those issues. The court also denied the plaintiffs' class
certification motion as moot.
The plaintiffs have appealed to the United States Court of Appeals
for the Ninth Circuit. Because of the uncertainty around pending
unresolved issues, including an insufficient description of the
purported classes and other related matters, the company said it
cannot reasonably estimate a range of potential exposures at this
time.
XL GROUP: Tag-Along Antitrust Lawsuits Now Dismissed
----------------------------------------------------
Tag-along actions that were consolidated into In re Brokerage
Antitrust Litigation have now been dismissed with prejudice
against all XL Group entities, according to the company's May 7,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2013.
In August 2005, plaintiffs in a proposed class action (the "Class
Action") that was consolidated into a multidistrict litigation in
the United States District Court for the District of New Jersey,
captioned In re Brokerage Antitrust Litigation, MDL No. 1663,
Civil Action No. 04-5184 (the "MDL"), filed a consolidated amended
complaint (the "Amended Complaint"), which named as new defendants
approximately 30 entities, including Greenwich Insurance Company,
Indian Harbor Insurance Company and XL-Cayman (the "XL
Defendants").
In the MDL, the Class Action plaintiffs asserted various claims
purportedly on behalf of a class of commercial insureds against
approximately 113 insurance companies and insurance brokers
through which the named plaintiffs allegedly purchased insurance.
The Amended Complaint alleged that the defendant insurance
companies and insurance brokers conspired to manipulate bidding
practices for insurance policies in certain insurance lines and
failed to disclose certain commission arrangements and the Amended
Complaint asserted statutory claims under the Sherman Act, various
state antitrust laws and the Racketeer Influenced and Corrupt
Organizations Act ("RICO"), as well as common law claims alleging
breach of fiduciary duty, aiding and abetting a breach of
fiduciary duty and unjust enrichment.
By Opinion and Order dated August 31, 2007, the District Court
dismissed the Sherman Act claims with prejudice and, by Opinion
and Order dated September 28, 2007, the District Court dismissed
the RICO claims with prejudice. The plaintiffs then appealed both
Orders to the U.S. Court of Appeals for the Third Circuit.
On August 16, 2010, the Third Circuit affirmed in large part the
District Court's dismissal but reversed the dismissal of certain
Sherman Act and RICO claims alleged against several defendants
including the XL Defendants and remanded those claims to the
District Court for further consideration of their adequacy. In
light of its reversal and remand of certain of the federal claims,
the Third Circuit also reversed the District Court's dismissal
(based on the District Court's declining to exercise supplemental
jurisdiction) of the state-law claims against all defendants.
In May 2011, after participating in a settlement mediation, a
majority of the remaining defendants, including the XL Defendants,
executed a formal Settlement Agreement with the Class Action
plaintiffs. Upon the District Court's approval of the settlement,
the Class Action claims against the settling defendants, including
the XL Defendants, were dismissed with prejudice.
Various XL entities were also named as defendants in three of the
many tag-along actions that were consolidated into the MDL for
pretrial purposes. The complaints in these three tag-along actions
made allegations similar to those made in the Class Action Amended
Complaint but did not purport to be class actions.
In connection with the settlement mediation of the tag-along
actions ordered by the District Court, the XL entities reached
separate settlements in 2012 with all of the respective plaintiffs
in two of the three tag-along actions in which XL entities were
named and settled the third tag-along action during the quarter.
Each of the tag-along actions has now been dismissed with
prejudice against all XL entities.
YONGYE INTERNATIONAL: Class Suits Over Wu Proposal Consolidated
---------------------------------------------------------------
The class action lawsuits arising from the proposed buyout of
Yongye International, Inc., by Zishen Wu was consolidated in
April, according to the Company's May 10, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended March 31, 2013.
On October 15, 2012, the Company's Board of Directors received a
preliminary, non-binding proposal letter ("Proposal Letter") from
(i) Zishen Wu, the Company's Chairman and Chief Executive Officer,
(ii) Full Alliance International Limited, (iii) MSPEA Agriculture
Holding Limited, and (iv) Abax Global Capital (Hong Kong) Limited,
on behalf of funds managed and/or advised by nominee entities and
its and their affiliates (collectively, "Abax", together with Mr.
Wu, Full Alliance and MSPEA, the "Buyer Parties"), to acquire all
of the outstanding shares of common stock of the Company not
currently owned by the Buyer Parties in a going private
transaction for $6.60 per share of common stock in cash, subject
to certain conditions (the "Wu Proposal"). According to the
Proposal Letter, an acquisition vehicle will be formed for the
purpose of completing the acquisition, and the acquisition is
intended to be financed through a combination of debt and equity
capital. Equity financing will be provided by the Buyer Parties
or their affiliates in the form of cash and/or rollover equity in
the Company. Debt financing will be primarily provided by third
party financial institutions. A special committee ("Special
Committee") of the Board of the Directors has retained Cleary
Gottlieb Steen & Hamilton LLP as its legal counsel and Houlihan
Lokey as its independent financial advisor to assist it in
consideration of such matters. No decisions have been made by the
Special Committee with respect to the Company's response to the
Proposal Letter.
On or about October 18, 2012, and October 22, 2012, five
shareholder class action complaints were filed against the Company
and certain officers and directors thereof in connection with the
Wu Proposal. The five complaints are captioned, respectively,
DOHERTY v. YONGYE INTERNATIONAL, INC., ZISHEN WU, NAN XU,
XIAOCHUAN GUO, HOMER SUN, SEAN SHAO, XINDAN LI, AND RIJUN ZHANG,
A-12-670343-C; KIRBY v. ZISHEN WU, NAN XU, HOMER SUN, XIAOCHUAN
GUO, SEAN SHAO, XINDAN LI, RIJUN ZHANG, FULL ALLIANCE
INTERNATIONAL LIMITED, MSPEA AGRICULTURE HOLDINGS LIMITED, ABAX
GLOBAL CAPITAL (HONG KONG) LIMITED, and YONGYE INTERNATIONAL INC.,
A-12-670468-C; Dominic Calisti v. Zishen Wu, et. Al., Case No. A-
12-670758-B, Dept. No. XI; Dong Seng Kong, et al. v. Zishen Wu,
et. Al., Case No. A-12-670874-B, Dept. No. XI; and William A.
Harris, Jr. v. Yongye International, Inc., et. Al., Case No. A-12-
670817-B, Dept. No. XIII. All of the complaints were filed in
Nevada state court, Clark County District, and all of the
complaints challenge the Wu Proposal and allege, among other
things, that the consideration to be paid in such proposal is
inadequate, as is the process by which the proposal is being
evaluated. The complaints seek, among other relief, to enjoin
defendants from consummating the Wu Proposal and to direct
defendants to exercise their fiduciary duties to obtain a
transaction that is in the best interests of the Company's
shareholders. The complaints have been served on the Company.
On or about March 5, 2013, the plaintiff in the Doherty case filed
a notice of voluntary dismissal, leaving the four other cases
remaining. By stipulation and order, ordered April 23, 2013 (the
"Order"), the remaining cases were consolidated for all purposes
under the caption In re Yongye International, Inc. Shareholders'
Litigation, Case No. A-12-670468-B. Under the Order, the
Plaintiffs are directed to file a Consolidated Complaint within 20
days of the announcement of a definitive merger agreement entered
into in connection with any proposed going private transaction.
The Company has reviewed the allegations contained in the
complaints and believes they are without merit. The Company
intends to defend the litigations vigorously. As such, based on
the information known to date, the Company does not believe that
it is probable that a material judgment against it will result.
Yongye International, Inc., is a crop nutrient company
headquartered in Beijing, China. The Company is primarily engaged
in the research, development, manufacturing and sales of fulvic
acid based crop and animal nutrient products for the agriculture
and stock farming industry.
* New Bill Gives Businesses Chance to Escape Class Actions
----------------------------------------------------------
Howard Fischer, writing for Verde Independent, reports that state
lawmakers voted on May 30 to give businesses a chance to escape
from class-action lawsuits before the legal bills -- and potential
verdict against them -- gets too large.
On a voice vote, with Republicans in favor, the House approved SB
1346, which permits a party to a lawsuit to file an appeal the
moment a trial judge decides whether a lawsuit can be maintained
as a class action. Now, whichever side loses must wait until the
end of the case to argue that the trial judge was wrong.
Rep. Justin Pierce, R-Mesa, said that difference is significant.
More to the point, he said it could decide whether a company
decides to fight the case or simply settles to avoid future costs.
Most lawsuits are brought by individuals or companies who say they
have been damaged by the acts of others.
In a class-action lawsuit, one or more people seek to represent
the interests of everyone else who has been similarly affected by
a defendant's conduct, especially when everyone cannot be
individually identified at the time the suit is filed. That
might, for example, include everyone who bought a particular
product.
The advantage is not just in avoiding multiple trials. It also
means that individuals whose own claims may be too small to be
worth fighting in court -- perhaps just $50 -- can unite their
efforts.
Mr. Pierce said, though, there is a flip side to the issue.
"Class-action litigation is exorbitant in its expense,' he said.
"Where the expense comes in is in discovery,' Mr. Pierce
explained, the pretrial activities where each side does its own
investigation as well as takes sworn depositions and seeks
documents from those on the other side of the case. And the costs
of that, he said can reach into the millions.
"That is usually what drives a settlement in a case, not based on
the merits, but because the defendant . . . is faced with the
potential of millions and millions of (legal) fees,' Pierce said.
"And so they may be driven to settle the case unfairly.'
Allowing someone -- presumably a defendant -- to immediately
appeal a judge's certification of a class-action claim gives that
party a chance to escape those costs if the appellate court
overturns the order. Otherwise, the case goes along as a class-
action matter, with the issue of whether the trial judge was wrong
decided only at the end.
That's exactly what happened two years ago when the U.S. Supreme
Court, on a 5-4 vote, threw out what had been certified by a lower
court judge as a class-action lawsuit against retail giant
Wal-Mart. The lawsuit had sought billions of dollars on behalf of
about 1.5 million female employees, charging they were the victims
of system-wide discriminatory practices and pay.
Justice Antonin Scalia said federal rules require class-action
lawsuits to have "questions of law or fact common to the class.'
In this case, he said, the allegations failed to provide
"convincing proof of a companywide discriminatory pay and
promotion policy,' meaning the trial judge should never have
granted class-action status in the first place.
Rep. Debbie McCune Davis, D-Phoenix, said she fears the
legislation will undermine the ability to pursue class-action
lawsuits. She said there are legitimate reasons for combining all
affected plaintiffs under a single legal umbrella.
As an example she cited the fertilizer explosion earlier this
month in West, Tex.
"If you look at this bill in the context of the damage done to a
single community by a single entity, you really can see the
importance of being able to proceed forward to hold the party
responsible through a class action,' she said. Ms. McCune Davis
said 180 people were hospitalized and a "substantial' part of
housing was wiped out.
"People are going to want to know what caused the explosion, who
was responsible, was their negligence,' she said. "And if, in
fact, there is, it's really better for the community to proceed as
a class action to seek that remedy than to have individuals pursue
it individually.'
But Rep. Eddie Farnsworth, R-Gilbert, said nothing in the
legislation alters the standards a trial judge will use to
determine whether a claim merits class-action status. The only
difference, he said, is it permits whoever does not agree with the
judge's ruling to seek immediate appeal rather than have to wait
until the trial is over -- or to settle beforehand.
The merits of the change aside, Rep. Martin Quezada, D-Phoenix,
said lawmakers may be treading where they are not allowed. He
said the rules of when a judge's decision can be appealed are set
by the Arizona Supreme Court and beyond the authority of the
Legislature.
Mr. Farnsworth disagreed, saying lawmakers have "some purview'
over how cases are handled.
A final roll-call vote is needed to send the measure to the
Senate, which has never considered the language now in the bill.
* Rise in Consumer Class Actions Spark Debate in California
-----------------------------------------------------------
Amanda Robert, writing for Legal Newsline, reports that class
action lawsuits continue to incite debate in California,
especially as they grow in size and scope, and affect more of the
state's consumers.
Recent high-profile cases involve Hewlett-Packard and consumers
who bought printers and claimed they were misled into misusing ink
cartridges; and Apple and consumers who claimed its MacBook power
adapters were defective. Another significant class action filed
in California pitted Facebook against consumers, who alleged the
company misappropriated users' names and likenesses in
advertisements.
William Stern, a partner in the San Francisco office of Morrison &
Foerster who focuses on the defense of consumer class actions,
contends California has always seen a disproportionate share of
the nation's class actions. However, he says, their numbers
increased in the last five years as more out-of-state lawyers
worked with in-state lawyers to bring lawsuits to plaintiff-
friendly California.
"People are choosing California as a forum of first choice, or
they are partnering and getting admitted here, and bringing suits
that, in many ways, have no reason to be here," Mr. Stern said.
"In other words, even the main plaintiff and company aren't here."
Mr. Stern points to a broad interpretation of the California's
Unfair Competition Law, or the "Little FTC Act," as the primary
reason. In California, he says, plaintiff lawyers find it easier
to overcome what in other states would be a problem of "no
injury."
In one of his examples, a consumer buys soup, because the
packaging describes the contents as "all natural." However, the
consumer later discovers the soup contains genetically-modified
corn. Because the consumer believes genetically-modified corn
isn't natural, she sues the company.
"There is nothing wrong with the product," Stern said. "There is
nothing contaminated. It wasn't short-weighted. It wasn't
adulterated, toxic or unhealthy. It's just that now you claim
what you got isn't what you thought you were getting, and everyone
who bought it nationwide over the past four years should get their
money back.
"In many states, in many courts, the defendant would say that
isn't an injury. It might be a regulatory problem that someone
might take offense to, but you haven't been injured in the sense
of Article 3."
Mr. Stern adds that in most states, these types of class actions
don't proceed past the motion to dismiss. However, in California,
in both state and federal courts, plaintiffs typically succeed and
can move forward with the lawsuit.
"Even if it's a fairly bogus claim, it has value because the next
opportunity to get out of the case might be in nine months or a
year, and only after you've gone through very burdensome e-
discovery that could cost hundreds of thousands or millions of
dollars," Mr. Stern said. "You may choose instead to take those
defense costs and settle."
Kim Stone, the president of the Civil Justice Association of
California, agrees that California has experienced a proliferation
of class action lawsuits. According to CJAC, more than four class
actions are filed each day.
Ms. Stone also argues that California maintains laws that are the
most favorable to class actions in the country. She adds that her
state's class action law differs significantly from federal class
action law, particularly with respect to class certification. In
California, once a judge certifies a class, the defendant can't
appeal the decision until after the trial.
"But nobody goes to trial in class action lawsuits, because
they're so big and expensive, so nobody ends up getting to appeal
that class certification decision," Ms. Stone said.
Ms. Stone points out that federal law, as well as many other
states' laws, allows the permissive appeal of class certification
decisions.
Consumer Attorneys of California President Brian Kabateck --
bsk@kbklawyers.com -- represents the other side in the debate,
calling the state's class action process fair. He contends that
since class certification isn't automatic, many class actions are
filed but denied.
Mr. Kabateck also sees appellate review of class certification as
a vital part of the process for defendants.
"I've had cases where the Court of Appeals agrees to look at the
class certification and cases where they don't," Mr. Kabateck
said. "It isn't an automatic appeal, but it's still a fair
alternative to a defendant who believes they have had a bad
decision made."
Ms. Stone agrees that class actions can serve an important
purpose. She explains that in egregious situations, like a
company paying its female employees less than its male employees,
a class action could be an appropriate remedy. And historically,
she says, those such as Brown v. Board of Education secured
significant civil rights.
"But over time in California, they've morphed and bastardized
consumer class actions," Ms. Stone said. "We've had lawsuits in
California where they sued Nutella because it wasn't really part
of a healthy breakfast, or they sued Netflix because I didn't
really get unlimited movies."
Ms. Stone adds that many frivolous class actions end with
"ridiculous results," where plaintiff lawyers get millions of
dollars while class members get a small refund or coupon.
Mr. Kabateck offers his own explanation for large attorney fees in
class actions. If the class is treated fairly and benefits from
the lawsuit, its lawyers deserve payment. He contends that like
lawyers who work for corporations, they don't work for free.
"We live in a society where people are compensated for their
efforts and their work," he said.
When asked how to solve the problems with class actions, Ms. Stone
points out that CJAC ran bills in the California legislature to
try to improve the law. They all failed in the first committee.
Another option, she says, would be a statewide ballot initiative,
but it's both difficult and expensive.
In 2004, Ms. Stone and Mr. Stern helped pass Proposition 64, which
limited private lawsuits against a company to those where an
individual was actually injured by and suffered a financial loss
as a result of unfair, unlawful or fraudulent business practices.
Since then, Mr. Stern says, several California Supreme Court
decisions have dismantled what voters intended with the
initiative.
"Here we are 10 years later, and we're back to where we were
before," he said. "Anybody can sue. You barely need a client.
All you need to say is you bought it, and if only you would have
known 'fill in the blank,' you wouldn't have bought it or you
wouldn't have paid as much."
* U.S. Equal Employment Opportunity Commission Files GINA Suit
--------------------------------------------------------------
Kathy Robertson, writing for Sacramento Business Journal, reports
that the U.S. Equal Employment Opportunity Commission in May
settled its first lawsuit related to the Genetic Information
Nondiscrimination Act of 2008 and filed its first class action
under the law.
The law is meant to protect workers against genetic discrimination
in health insurance and employment now that genetic testing has
become more common -- and can inform individuals whether they
might be at risk for developing a specific disease or disorder.
The settlement requires Fabricut, a large distributor of
decorative fabrics, to pay $50,000 and provide other relief after
the Tulsa, Okla.-based company refused to hire a woman as a memo
clerk because it regarded her as having carpal tunnel syndrome
after asking for her family medical history in a post-offer
medical exam.
"Employers need to be aware that GINA prohibits requesting family
medical history," David Lopez, general counsel for EEOC, said in a
news release. "When illegal questions are required as part of the
hiring process, the EEOC will be vigilant to ensure that no one be
denied a job on a prohibited basis."
The first class action relates to the same kind of violation.
EEOC sued The Founders Pavilion Inc., a Corning New York nursing
and rehabilitation center, on May 16. The class action alleges
Founders conducted post-offer, pre-employment medical exams of job
applicants that were repeated annually if the person was hired.
Family medical history was part of the exam.
The class action also alleges violations of federal disability
rights and civil rights laws for other actions by the company.
One of EEOC's six national priorities under its strategic
enforcement plan is to address emerging and developing issues in
equal employment law, which includes genetic discrimination.
Marcia Augsburger, a partner and employment lawyer in the
Sacramento office of DLA Piper, says she hasn't seen any local
GINA cases.
"In general, people are pretty sensitive to privacy issues in
California," she said.
Her concern is over zealous adherence to the law.
"I've seen it with HIPAA (federal health record privacy rules in
the Health Insurance Portability and Accountability Act), when
provider become so sensitized as to become hamstrung," Ms.
Augsburger said.
*********
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., Washington, D.C., USA. Noemi Irene
A. Adala, Joy A. Agravante, Valerie Udtuhan, Julie Anne L. Toledo,
Christopher Patalinghug, Frauline Abangan and Peter A. Chapman,
Editors.
Copyright 2013. All rights reserved. ISSN 1525-2272.
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