/raid1/www/Hosts/bankrupt/CAR_Public/130827.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, August 27, 2013, Vol. 15, No. 169
Headlines
APPLE INC: Files Motion to Dismiss iPhone Siri Class Action
APPLE INC: Court Narrows Claims in "Pirozzi" Class Action
AVON PRODUCTS: N.Y. Court Yet to Rule on Bid to Junk Stock Suit
AVON PRODUCTS: Plaintiffs in N.Y. Stock Suit Withdraw Appeal
CIGNA CORPORATION: Still Faces "Amara" ERISA Violations Suit
CIGNA CORPORATION: Suit Over Ingenix Denied Class Status
DENTSPLY INTERNATIONAL: September Trial Set in Cavitron Suit
DENTSPLY INTERNATIONAL: One Claim Remains in Periodontists' Suit
DIAMOND FOODS: Settles Securities Class Action for $96 Million
GEORGIA: Judge Upholds Class Cert. in Deaf Adults' Suit
HEWLETT-PACKARD: Faces Class Action Over Warranty Policy Breach
IGATE CORP: Shareholder Voluntarily Dismisses Class Action
INCYTE CORPORATION: Still Faces Securities Suits in Delaware
JAMES SCOTT FARRIN: Court Dismisses Farmers' Contract Breach Suit
KANSAS POWER: Faces Class Action Over Solar-Panel Rebate Program
LIGAND PHARMACEUTICALS: Seeks to Dismiss Genaera Securities Suit
NETFLIX INC: Ejects Claim That It Misled Investors
NEW YORK, NY: Judge Barkett Dissents Stop-and-Frisk Searches
PDC ENERGY: 2014 Trial Set in Suit Over Partnership Purchases
PITNEY BOWES: Lawsuit by Health & Welfare Fund Now Concluded
REYNOLDS AMERICAN: 7 Cases Set for Trial for June 2013-2014
REYNOLDS AMERICAN: Asks Fla. Court to Fix Post-Settlement Issues
REYNOLDS AMERICAN: Awaits Ruling on Appeal in "Ciccone" Suit
REYNOLDS AMERICAN: Reports 2574 Broin II Cases as of June 30
REYNOLDS AMERICAN: RJR Tobacco Faces 8 Class Suits as of June
REYNOLDS AMERICAN: June 2014 Trial Set in Camel Cash Cert. Suit
REYNOLDS AMERICAN: Appeal v. "Lights" Cases Dismissal Continues
SAXON MORTGAGE: Court Certifies Class in "Gaudin" Suit
SEARS HOLDINGS: Appeals Court Upholds Washing Machine Class Status
SPARTAN STORES: Faces Suit Over Merger With Nasch Finch Company
TOYOTA MOTOR: Five Class Members Appeal Settlement Approval
VECTOR GROUP: Engle Cases Reach 4,300 as of June 2013
VECTOR GROUP: Liggett Named in Four Purported Collective Suits
VECTOR GROUP: Appeal in Smith v. Philip Morris Pending
VECTOR GROUP: "Young v. American Tobacco" Still Inactive
VECTOR GROUP: Suit by West Virginia Residents Remains Stayed
VECTOR GROUP: Expects Adverse Effect If "Lights" Suit Increases
VELTI PLC: Sued for Misleading Investors by Hiding Collection Woes
WARNER CHILCOTT: Accused of Providing False Info in Actavis Sale
WELLS FARGO: Court Dismisses Overlapping Class Claims
*********
APPLE INC: Files Motion to Dismiss iPhone Siri Class Action
-----------------------------------------------------------
Max Taves, writing for The Recorder, reports that iPhone 4S users
fed up with Siri still haven't made a specific enough case that
Apple Inc. over-hyped the capabilities of its voice-recognition
software, the company's lawyers contend in a motion to dismiss
filed on Aug. 20.
"Plaintiffs' new claim is that Apple represented that Siri would
always work perfectly, 'without a single hiccup,' and would never
fail to provide 'adequate response(s)' to any and all questions
and commands," wrote Apple attorney Gail Lees --
glees@gibsondunn.com -- a Gibson, Dunn & Crutcher partner. "But
Apple never made any such representation."
Last month, U.S. District Chief Judge Claudia Wilken dismissed the
Siri suit with leave to amend because, she wrote, plaintiffs had "
failed to allege sufficiently the 'how' of the purported
misrepresentations." In her order last month, Judge Wilken also
noted that plaintiffs highlighted Apple's marketing campaign
promoting Siribut did not point to the particular ads that misled
them.
Apple's lawyers at Gibson Dunn argue that Judge Wilken should
dismiss the most recent complaint -- In Re iPhone Consumer
Litigation, 12-1127 -- for the same reasons and without giving
plaintiffs another chance to fine tune their suit. That's because
plaintiffs' amended suit still doesn't identify specific false or
misleading claims about Siri, Apple insists.
The class of iPhone 4S consumers is represented by attorneys at
Robbins Geller Rudman & Dowd; Gardy & Notis; and Barnow and
Associates.
"The truth is that Siri did and does not work as represented by
Apple in its marketing and advertisements for the iPhone 4S,"
wrote Robert Rothman of Robbins Geller in the amended complaint
filed Aug. 6, which again relied heavily on Apple's global ad
blitz.
One statement they pointed to was made by Apple executive
Scott Forstall during a video promoting the iPhone 4S. "Siri is a
whole new way of interacting with your iPhone, using just your
voice," said Mr. Forstall. "It's like this amazing assistant that
listens to you, understands you, can answer your questions and can
even accomplish tasks for you."
But Apple's lawyers say the complaint is still too general and
plaintiffs have not come up with a single specific statement that
would have misled customers.
"The truth is that while Apple represented Siri as a 'cool' and
'amazing' new feature of iPhone 4S, it did not represent Siri as
flawless," Ms. Lees wrote in the motion to dismiss, which pointed
to the burden Judge Wilken "spelled out" at a prior hearing.
"It's got to be X, Y and Z statement on this ad and that ad,"
Judge Wilken stated, according to Apple's motion," . . . And those
are the things that we relied on."
APPLE INC: Court Narrows Claims in "Pirozzi" Class Action
---------------------------------------------------------
District Judge Jon S. Tigar issued an order granting in part and
denying in part a motion to dismiss a second amended complaint in
MARIA PIROZZI, Plaintiff, v. APPLE, INC., Defendant, CASE NO.
12-CV-01529-JST, (N.D. Cal.)
Maria Pirozzi filed this proposed class action on March 27, 2012,
against Apple for failing to prevent third-party software
applications distributed through its online App Store from
uploading user information from Apple's mobile devices without
permission.
The Court previously dismissed the Plaintiff's First Amended
Complaint with leave to amend. Subsequently, Apple moved to
dismiss the Plaintiff's Second Amended Complaint for lack of
Article III standing, statutory standing, failure to plead fraud
with particularity, and failure to state a claim upon which relief
may be granted.
The Court ruled that the Plaintiff's unjust enrichment claim is
dismissed without leave to amend. However, Apple's Motion to
Dismiss is denied on all other grounds, Judge Tigar added.
A copy of the District Court's August 5, 2013 Order is available
at http://is.gd/o1Mq1Jfrom Leagle.com.
Maria Pirozzi, Plaintiff, represented by Jennifer Sarnelli --
jsarnelli@gardylaw.com -- at Gardy & Notis, LLP, James S. Notis --
jnotis@gardylaw.com -- Gardy & Notis, LLP & Kira German --
kgerman@gardylaw.com
Maria Pirozzi, individually and on behalf of all others similarly
situated, Plaintiff, represented by:
Martin Stuart Bakst
Attorney at Law
15760 Ventura Blvd 16FL
Encino, CA 91436
Office: 818-981-1400
Apple, Inc, Defendant, represented by S. Ashlie Beringer --
aberinger@gibsondunn.com -- at Gibson Dunn & Crutcher LLP, Joshua
Aaron Jessen -- jjessen@gibsondunn.com -- at Gibson Dunn &
Crutcher LLP & Maia Taussig Perez -- mperez@gibsondunn.com -- at
Gibson Dunn & Crutcher LLP.
Twitter, Inc., Miscellaneous, represented by Timothy L. Alger --
TAlger@perkinscoie.com -- at Perkins Coie LLP.
AVON PRODUCTS: N.Y. Court Yet to Rule on Bid to Junk Stock Suit
---------------------------------------------------------------
Avon Products, Inc. is awaiting a ruling by the United States
District Court for the Southern District of New York on its motion
to dismiss an amended securities complaint, according to the
company's Aug. 1, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended June 30, 2013.
On July 6, 2011, a purported shareholder's class action complaint
(City of Brockton Retirement System v. Avon Products, Inc., et
al., No. 11-CIV-4665) was filed in the United States District
Court for the Southern District of New York against certain
present or former officers and/or directors of the Company.
On September 29, 2011, the Court appointed LBBW Asset Management
Investmentgesellschaft mbH and SGSS Deutschland
Kapitalanlagegesellschaft mbH as lead plaintiffs and Motley Rice
LLC as lead counsel. Lead plaintiffs have filed an amended
complaint on behalf of a purported class consisting of all persons
or entities who purchased or otherwise acquired shares of Avon's
common stock from July 31, 2006 through and including October 26,
2011.
The amended complaint names the Company and two individual
defendants and asserts violations of Sections 10(b) and 20(a) of
the Exchange Act based on allegedly false or misleading statements
and omissions with respect to, among other things, the Company's
compliance with the FCPA, including the adequacy of the Company's
internal controls.
Plaintiffs seek compensatory damages as well as injunctive relief.
Defendants moved to dismiss the amended complaint on June 14,
2012. The company is unable to predict the outcome of this
matter. However, it is reasonably possible that the company may
incur a loss in connection with this matter. The company is unable
to reasonably estimate the amount or range of such reasonably
possible loss.
AVON PRODUCTS: Plaintiffs in N.Y. Stock Suit Withdraw Appeal
------------------------------------------------------------
Plaintiffs in In re Avon Products, Inc. Shareholder Litigation,
Consolidated Index No. 651087/2012E, withdraw an appeal against an
order dismissing the complaint, according to the company's Aug. 1,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2013.
In April 2012, several purported shareholders' actions were filed
against the Company and certain present or former directors of the
Company in New York Supreme Court, New York County (Pritika v.
Jung, et al., Index No. 651072/2012; Feinman v. Avon Products,
Inc., et al., Index No. 651087/2012; Gaines v. Jung, et al., Index
No. 651097/2012; Schwartz v. Avon Products, Inc., et al., Index
No. 651152/2012; Robaczynki, individually and on behalf of all
others similarly situated and derivatively on behalf of Avon
Products, Inc. v. Jung, et al., Index No. 651176/2012).
On April 26, 2012, the actions were consolidated in New York
Supreme Court, New York County (In re Avon Products, Inc.
Shareholder Litigation, Consolidated Index No. 651087/2012E). An
amended consolidated complaint was filed on May 18, 2012. The
amended consolidated complaint asserts a derivative claim against
the individual defendants based on alleged breaches of fiduciary
duties in connection with indications of interest by Coty, Inc. in
acquiring the Company.
The Company is named as a nominal defendant on the purported
derivative claim, and no relief appears to be sought against the
Company on that claim. The amended consolidated complaint also
asserts a purported direct claim on behalf of a class of
shareholders against the individual defendants based on alleged
breaches of such fiduciary duties. Plaintiffs seek compensatory
damages as well as injunctive relief.
On June 27, 2012, defendants moved to dismiss the consolidated
action. By decision and order dated March 5, 2013, the court
granted defendants' motion to dismiss the complaint with
prejudice. On April 1, 2013, plaintiffs filed a notice of appeal
from the court's order dismissing the complaint. On July 1, 2013,
plaintiffs' appeal was withdrawn with prejudice.
CIGNA CORPORATION: Still Faces "Amara" ERISA Violations Suit
------------------------------------------------------------
Cigna Corporation continues to face the so-called Amara cash
balance pension plan litigation, according to the company's
Aug. 1, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2013.
On December 18, 2001, Janice Amara filed a class action lawsuit,
captioned Janice C. Amara, Gisela R. Broderick, Annette S. Glanz,
individually and on behalf of all others similarly situated v.
Cigna Corporation and Cigna Pension Plan, in the United States
District Court for the District of Connecticut against Cigna
Corporation and the Cigna Pension Plan on behalf of herself and
other similarly situated participants in the Cigna Pension Plan
affected by the 1998 conversion to a cash balance formula.
The plaintiffs allege various ERISA violations including, among
other things, that the Plan's cash balance formula discriminates
against older employees; the conversion resulted in a wear away
period (when the pre-conversion accrued benefit exceeded the post-
conversion benefit); and these conditions are not adequately
disclosed in the Plan.
In 2008, the court issued a decision finding in favor of Cigna
Corporation and the Cigna Pension Plan on the age discrimination
and wear away claims. However, the court found in favor of the
plaintiffs on many aspects of the disclosure claims and ordered an
enhanced level of benefits from the existing cash balance formula
for the majority of the class, requiring class members to receive
their frozen benefits under the pre-conversion Cigna Pension Plan
and their post-1997 accrued benefits under the post-conversion
Cigna Pension Plan. The court also ordered, among other things,
pre-judgment and post-judgment interest.
Both parties appealed the court's decisions to the United States
Court of Appeals for the Second Circuit that issued a decision on
October 6, 2009 affirming the District Court's judgment and order
on all issues. On January 4, 2010, both parties filed separate
petitions for a writ of certiorari to the United States Supreme
Court. Cigna's petition was granted, and on May 16, 2011, the
Supreme Court issued its Opinion in which it reversed the lower
courts' decisions and remanded the case to the trial judge for
reconsideration of the remedy.
The Court unanimously agreed with the Company's position that the
lower courts erred in granting a remedy for an inaccurate plan
description under an ERISA provision that allows only recovery of
plan benefits. However, the decision identified possible avenues
of "appropriate equitable relief" that plaintiffs may pursue as an
alternative remedy. The case was returned to the trial court and
hearings took place on December 9, 2011 and March 29-30, 2012.
Over that summer, the trial judge passed away after a long illness
and the case was re-assigned.
On December 20, 2012, the new trial judge issued a decision
awarding equitable relief to the class. The court's order
requires the Company to reform the pension plan to provide a
substantially identical remedy to that ordered by the first trial
judge in 2008. Both parties appealed the order and the judge
stayed implementation of the order pending resolution of the
appeals.
In light of the re-affirmed remedy ordered by the District Court,
the Company was required to re-evaluate its reserve for this case.
Due to the current economic environment of low interest rates that
have a significant impact on the valuation of potential future
pension benefits, the Company was required to increase its reserve
for this matter in the fourth quarter of 2012. The Company will
continue to vigorously defend its position in this case.
CIGNA CORPORATION: Suit Over Ingenix Denied Class Status
--------------------------------------------------------
The case filed against Cigna Corporation over the use of data from
Ingenix, Inc. to calculate payments is proceeding in the United
States District Court for the District of New Jersey on behalf of
the named plaintiffs only after a motion to certify a class was
denied, according to the company's Aug. 1, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2013.
On February 13, 2008, State of New York Attorney General Andrew M.
Cuomo announced an industry-wide investigation into the use of
data provided by Ingenix, Inc., a subsidiary of UnitedHealthcare,
used to calculate payments for services provided by out-of-network
providers.
The Company received four subpoenas from the New York Attorney
General's office in connection with this investigation and
responded appropriately. On February 17, 2009, the Company entered
into an Assurance of Discontinuance resolving the investigation.
In connection with the industry-wide resolution, the Company
contributed $10 million to the establishment of a new non-profit
company that now compiles and provides the data formerly provided
by Ingenix.
The Company was named as a defendant in a number of putative
nationwide class actions asserting that due to the use of data
from Ingenix, Inc., the Company improperly underpaid claims, an
industry-wide issue. All of the class actions were consolidated
into Franco v. Connecticut General Life Insurance Company et al.,
which is pending in the United States District Court for the
District of New Jersey.
The consolidated amended complaint, filed on August 7, 2009,
asserts claims under ERISA, the RICO statute, the Sherman
Antitrust Act and New Jersey state law on behalf of subscribers,
health care providers and various medical associations.
On September 23, 2011, the court granted in part and denied in
part the Company's motion to dismiss the consolidated amended
complaint. The court dismissed all claims by the health care
provider and medical association plaintiffs for lack of standing
to sue, and as a result the case proceeded only on behalf of
subscribers. In addition, the court dismissed all of the antitrust
claims, the ERISA claims based on disclosure and the New Jersey
state law claims. The court did not dismiss the ERISA claims for
benefits and claims under the RICO statute.
Plaintiffs filed a motion to certify a nationwide class of
subscriber plaintiffs on December 19, 2011 that was denied on
January 16, 2013. Plaintiffs petitioned for an immediate appeal
of the order denying class certification, but their petition was
denied by the United States Court of Appeals for the Third Circuit
on March 14, 2013, meaning that plaintiffs cannot appeal the
denial of class certification until there is a final judgment in
the case. As a result, the case is proceeding in the District
Court on behalf of the named plaintiffs only.
It is reasonably possible that others could initiate additional
litigation or additional regulatory action against the Company
with respect to use of data provided by Ingenix, Inc. The Company
denies the allegations asserted in the investigations and
litigation and will vigorously defend itself in these matters.
DENTSPLY INTERNATIONAL: September Trial Set in Cavitron Suit
------------------------------------------------------------
The case proceeding on behalf of dental professionals over
DENTSPLY International Inc.'s Cavitron ultrasonic scalers is
currently scheduled for trial in September 2013, according to the
company's Aug. 1, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended June 30, 2013.
On June 18, 2004, Marvin Weinstat, DDS and Richard Nathan, DDS
filed a class action suit in San Francisco County, California
alleging that the Company misrepresented that its Cavitron
ultrasonic scalers are suitable for use in oral surgical
procedures.
The Complaint seeks a recall of the product and refund of its
purchase price to dentists who have purchased it for use in oral
surgery. The Court certified the case as a class action in June
2006 with respect to the breach of warranty and unfair business
practices claims.
The class that was certified is defined as California dental
professionals who, at any time during the period beginning June
18, 2000 through September 14, 2012, purchased and used one or
more Cavitron ultrasonic scalers for the performance of oral
surgical procedures on their patients, which Cavitrons were
accompanied by Directions for Use that "Indicated" Cavitron use
for "periodontal debridement for all types of periodontal
disease." A Class Notice was mailed on September 14, 2012. The
Company is filing a Motion for Decertification which will be the
subject of a hearing in mid-August. The case is currently
scheduled for trial in September 2013.
DENTSPLY INTERNATIONAL: One Claim Remains in Periodontists' Suit
----------------------------------------------------------------
The U.S. District Court for the Eastern District of Pennsylvania
granted the motion of DENTSPLY International Inc. and dismissed
plaintiffs' New Jersey Consumer Fraud and negligent design claims,
in "Center City Periodontists," leaving only a breach of express
warranty claim, according to the company's Aug. 1, 2013, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2013.
On December 12, 2006, a Complaint was filed by Carole Hildebrand,
DDS and Robert Jaffin, DDS in the Eastern District of Pennsylvania
(the Plaintiffs subsequently added Dr. Mitchell Goldman as a named
class representative).
The case was filed by the same law firm that filed the Weinstat
case in California. The Complaint asserts putative class action
claims on behalf of dentists located in New Jersey and
Pennsylvania.
The Complaint seeks damages and asserts that the Company's
Cavitron ultrasonic scaler was negligently designed and sold in
breach of contract and warranty arising from misrepresentations
about the potential uses of the product because it cannot assure
the delivery of potable or sterile water.
Following dismissal of the case for lack of jurisdiction, the
plaintiffs filed a second complaint under the name of Dr.
Hildebrand's corporate practice. The Company's motion to dismiss
this new complaint was denied and the case will now proceed under
the name "Center City Periodontists."
The Court recently granted the Company's Motion and dismissed
plaintiffs' New Jersey Consumer Fraud and negligent design claims,
leaving only a breach of express warranty claim.
The Company does not believe a loss is probable related to the
above litigation. Further a reasonable estimate of a possible
range of loss cannot be made. In the event that one or more of
these matters is unfavorably resolved, it is possible the
Company's results from operations could be materially impacted.
DIAMOND FOODS: Settles Securities Class Action for $96 Million
--------------------------------------------------------------
Julia Love, writing for The Recorder, reports that eager to settle
a securities class action over its 2012 accounting scandal,
Diamond Foods Inc. has agreed to a deal worth roughly $96 million
-- a sum that falls short of what plaintiffs think they could
recover but won't capsize the troubled nut and snack maker either.
Diamond will shell out $11 million in cash and issue more than
four million shares of stock to settle the suit, according to a
motion filed in U.S. District Court for the Northern District of
California on Aug. 21 by lawyers for the Mississippi Public
Employees Retirement System.
MPERS, the lead plaintiff in the class action, accuses the San
Francisco-based company and two of its former directors of
fraudulently accounting for payments to walnut growers in order to
inflate earnings ahead of its failed bid to buy Pringles from
Procter & Gamble.
With Diamond now in dire financial straits, the deal is a far cry
from the "typical settlement where a plaintiff, at least
theoretically, can wring as much from the defendant as possible,
regardless of the consequences," MPERS lawyer John Harnes --
jfharnes@chitwoodlaw.com -- of Atlanta's Chitwood Harley Harnes
wrote in a motion for preliminary approval of the proposed
settlement.
Knowing payment to the class would largely come in the form of
Diamond stock, plaintiffs lawyers had to walk a tightrope between
recovering as much as possible for the class and keeping the
company afloat, Mr. Harnes wrote. The $96.1 million settlement
represents 25 to 40 percent of the maximum amount plaintiffs
thought they could recover in the suit. The stock component was
worth approximately $85.1 million at the Aug. 20 closing price.
"Any settlement could not be so onerous that it destroyed the
value of the common stock that lead plaintiff and the class were
receiving, or that it impaired the company's business plans going
forward," Mr. Harnes wrote.
Harnes firm and San Francisco's Lieff Cabraser Heimann & Bernstein
served as class counsel. Richard Heimann -- rheimann@lchb.com --
who is on the Lieff Cabraser team, declined to comment. Diamond
was defended by Fenwick & West partners Dean Kristy --
dkristy@fenwick.com -- and Susan Muck -- smuck@fenwick.com -- who
did not respond to requests for comment.
In May, U.S. District Judge William Alsup certified a class of
shareholders who bought Diamond stock between October 2010 and
February 2012.
After broaching the topic of a settlement this past December,
lawyers for Diamond and the class agreed in June to enter
mediation before U.S. Magistrate Judge Jacqueline Scott Corley,
according to the settlement motion. Diamond's debt loomed large
in the negotiations. The company has just $7.2 million in cash
and long-term obligations of $579 million, meaning stock would be
the main currency for settling In re Diamond Foods Securities
Litigation, 11-05386.
Plaintiffs lawyers wrote that they were motivated to strike a deal
in part because they feared that further litigation could drain
insurance proceeds available for a settlement or even drive
Diamond into bankruptcy.
"Once settlement negotiations commenced, lead plaintiff's
principal consideration was not the maximum damages that could be
achieved after trial, but the maximum that the company
realistically had the ability to pay," Mr. Harnes wrote.
Diamond is so deeply in debt that settlement talks had to involve
the company's creditors, including Oaktree Capital Management, a
Los Angeles-based asset management firm, according to plaintiffs'
motion.
"In a very real sense, lead plaintiff was not only negotiating
with Diamond, but to some extent with its lenders as well,"
Mr. Harnes wrote.
Diamond has been hit hard by falling walnut sales, and its books
are weighed down by debt from prior acquisitions as well as its
botched attempt to purchase Pringles in 2012, according to the
motion.
The Pringles deal crumbled after alleged accounting improprieties
at Diamond came to light. Diamond disclosed in February 2012 that
it would amend its financial statements because payments to walnut
growers had been misrepresented. The plaintiffs contend that
Diamond understated payments made to walnut growers and then made
additional payments to the farmers after the end of the fiscal
years, which overstated the company's income in 2010 and 2011.
Although former Diamond CEO Michael Mendes and former chief
financial officer Steven Neil were named as defendants in the
complaint, the settlement does not offer recovery against their
personal assets. Plaintiffs opted not to pursue Mendes and Neil
because insurance companies' willingness to contribute to the
settlement hinged on the release of all parties, Mr. Harnes wrote.
Judge Alsup scheduled a hearing for Aug. 22.
GEORGIA: Judge Upholds Class Cert. in Deaf Adults' Suit
-------------------------------------------------------
Iulia Filip, writing for Courthouse News Service, reports that
deaf people with behavioral or developmental disabilities can sue
as class over Georgia's failures in public mental health care
access, a federal judge ruled.
Renita Belton and Matthew Erickson, two deaf adults with severe
mental and developmental disorders, had sued the state in March
2010 on behalf of all Georgians in need of mental health care who
could not benefit from state-funded services because of the
state's inability to accommodate them. They claimed that they had
been unable to find deaf-appropriate group home care, leaving them
with no choice but to live at home with family members who are
fluent in American Sign Language.
The Northern District of Georgia certified their class in March
2011.
One year later, the court ruled that Georgia had failed to provide
deaf Georgians with meaningful access to public mental health care
services such as group home care. The ruling also noted that
Georgia faced a severe shortage of ASL-fluent mental health
practitioners and failed to reimburse health care providers for
the cost of interpreters.
U.S. District Judge Richard Story referred the case to mediation
and ordered Georgia to take certain steps to remedy violations of
the Americans with Disabilities Act and Section 504 of the
Rehabilitation Act.
After the court found Georgia liable under the ADA and Section
504, the state asked it to decertify the class and dismiss the
action for lack of standing.
Georgia argued that Belton and Erickson were not adequate class
representatives as to the claim of cost-associated denial of
access to interpreters.
Story sided with the plaintiffs last week, reminding the state
that Belton and Erickson had standing to raise ADA and Section 504
violations claims.
Belton and Erickson are adequate class representatives because
they have been denied access to state-provided mental health care
services such as group home living because of the state's failure
to accommodate the deaf, the ruling states.
Their claims are also typical of the class members' claims and
arise from the same conduct, according to the order.
"It is immaterial that the named plaintiffs and other members of
the plaintiff class may have been deprived of access to the
state's mental health care services in different ways or through
different means (e.g., through a lack of deaf-appropriate group
homes or ASL interpreters)," Story wrote.
Georgia has also sought to stay the implementation of the court's
remedy order, and the plaintiffs in turn moved to refer that
request to the monitor.
Story refused to dismiss the action, and gave Georgia six days to
answer the plaintiffs' motion.
A copy of the Aug. 13, 2013, order is available at Courthouse News
Service at: http://is.gd/BI8jTT
HEWLETT-PACKARD: Faces Class Action Over Warranty Policy Breach
---------------------------------------------------------------
Max Taves, writing for The Recorder, reports that Hewlett-Packard
Co. has refused to honor its own warranty policy for a line of
defective printers, according to a class action filed earlier last
week in the Northern District of California.
Represented by Houston's Caddell & Chapman, the proposed
nationwide class of consumers who purchased the 8500 or 8600
models of HP's Officejet Pro Wireless All-in-One printers say HP
has known the product is defective since at least 2009 but
"routinely refuses" to provide replacements or refunds for
printers under warranty.
The suit, Ferranti v. Hewlett-Packard, 13-3847, accuses the Palo
Alto-based tech manufacturer of violating federal and state
business and consumer laws, including the Magnuson-Moss Warranty
Act and California's Consumers Legal Remedies Act.
"HP's advertisements and marketing representations fail to mention
that, because of the defect, the HP Printers' wireless function
will cease operating with normal use during the printer's life,"
wrote Cory Fein, a partner at Cadell. He may be reached at:
Cory Fein, Esq.
CADDELL & CHAPMAN
1331 Lamar Street, Suite 1070
Houston, TX 77010
Tel: 713-581-8295
Toll Free: 877-553-3057
Fax: 713-751-0906
HP's legal team is not yet known.
In a statement e-mailed to The Recorder, HP spokeswoman
Sarah Pompei said, "We're reviewing the claims and have no comment
at this time."
Named plaintiff Vincent Ferranti's frustrating experience in 2009
with two HP printers led to the suit. When the wireless feature
on his OfficeJet Pro 8500 stopped working, HP gave him a new one
-- which also didn't work.
And despite repeated calls to technical support, HP neither fixed
the wireless glitch nor did it offer a full refund -- all in clear
violations of its limited warranty policy, according to attorneys
for plaintiffs.
The complaint quotes from online message boards, where users have
sounded off about the printers.
"This printer is nothing more than a $280 paperweight,"
ladybug4331 wrote in June on CNET.com. "We're on the 4th or 5th
warranty replacement. I've lost track. It's a lemon . . . I give
up on HP."
IGATE CORP: Shareholder Voluntarily Dismisses Class Action
----------------------------------------------------------
iGATE Corporation disclosed that on August 22, 2013, the class
action lawsuit filed against iGATE and its former CEO, Phaneesh
Murthy, by a shareholder of iGATE on June 14, 2013 in the United
States District Court for the Northern District of California, was
voluntarily dismissed by the shareholder plaintiff, without
prejudice. No payment or consideration of any kind was made by
any of the defendants in connection with the dismissal.
"We are pleased to put this matter behind us," commented
Mr. Gerhard Watzinger, President and CEO of iGATE. "With this
resolution, we can move forward and continue to focus on
delivering the top-quality services and solutions iGATE customers
have come to expect."
According to The Economic Times, the California-based firm was
slapped with a class action lawsuit for alleged violations of
federal securities laws. The suit alleged that the company failed
to disclose that Mr. Murthy was involved in an "improper
relationship with a subordinate employee" in violation of iGates'
stated policies.
It also said "Murthy's improper conduct created a risk that he
would be terminated from the company jeopardizing the company's
future success".
iGate had sacked Mr. Murthy on May 20 for allegedly failing to
report a relationship with a subordinate employee, according to
The Economic Times.
The suit was filed against the firm and some of its officers and
directors to recover damages from the company. The suit alleged
violations of the federal securities laws pursuant to Sections
10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder.
The suit was filed by a New York-Based law firm, Pomerantz
Grossman Hufford Dahlstrom & Gross LLP, on behalf of persons or
entities who purchased or acquired securities of iGate between
March 14, 2012 and May 21, 2013.
About iGATE
iGATE Corporation -- http://www.iGATE.com-- is the first
integrated technology and operations (iTOPS) company providing
full-spectrum consulting, technology and business process
outsourcing, and product and engineering solutions on a Business
Outcomes-based model. Armed with over three decades of IT
Services experience and powered by the iTOPS platform, iGATE's
multi-location global organization has a talent pool of more than
28,000 employees and consistently delivers effective solutions to
over 300 companies including Fortune 1000 clients spanning
verticals such as: banking and financial services; insurance and
healthcare; life sciences; manufacturing, retail, distribution and
logistics; media, entertainment, leisure and travel; energy and
utilities; public sector; and independent software vendors.
INCYTE CORPORATION: Still Faces Securities Suits in Delaware
------------------------------------------------------------
Incyte Corporation continues to face securities lawsuits filed in
the United States District Court for the District of Delaware,
according to the company's Aug. 1, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended June
30, 2013.
In March and April 2013, two lawsuits were filed in the United
States District Court for the District of Delaware against the
Company, its chief executive officer, its former chief commercial
officer, and its chief drug development and medical officer. The
complaints each allege violations of Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 on behalf of a purported class
of purchasers of the Company's stock between April 26, 2012 and
August 1, 2012.
In general, the complaints allege that the defendants issued
materially false or misleading statements concerning the Company's
business and prospects relating to the commercial launch of
JAKAFI.
The complaints seek damages in an unspecified amount, equitable
relief of an unspecified nature, and costs and expenses of
litigation. The Company believes it has meritorious defenses and
intends to vigorously defend itself against these lawsuits. The
Company is unable to estimate the possible loss or range of loss,
if any, at this time.
JAMES SCOTT FARRIN: Court Dismisses Farmers' Contract Breach Suit
-----------------------------------------------------------------
District Judge Richard J. Leon granted motions to dismiss the case
captioned JOHN W. BOYD, JR. and NATIONAL BLACK FARMERS
ASSOCIATION, INC., Plaintiffs, v. JAMES SCOTT FARRIN and ANDREW H.
MARKS, Defendants, CIVIL CASE NO. 12-01893 (RJL), (D. D.C.).
The Plaintiffs are a farm advocacy organization, the National
Black Farmers Association, and its president, John W. Boyd. Over
more than two decades, Boyd and the NBFA have fought tirelessly to
remedy years of discrimination against black farmers. Their work
culminated in two pieces of legislation and two class-action
lawsuits known as Pigford I and Pigford II. Together, these
legislative and legal victories produced over $1 billion that was
distributed among thousands of class members.
The Defendants are two members of the team of lawyers that
advocated on behalf of NBFA and class members in Pigford II. The
Plaintiffs allege that the Defendants promised to compensate them
for their advocacy work during Pigford II but failed to follow
through on their promise. The Plaintiffs' complaint brings three
claims: breach of fiduciary duty, quantum meruit, and breach of
contract.
The Defendants moved separately to dismiss the complaint for lack
of subject matter jurisdiction and for failure to state a claim.
A copy of the District Court's August 6, 2013 Memorandum Opinion
is available at http://is.gd/ryV0qafrom Leagle.com.
JOHN W. BOYD, JR., Plaintiff, and NATIONAL BLACK FARMERS
ASSOCIATION, INC., Plaintiff, represented by:
Alexander John Pires, Jr., Esq.
Diane Elizabeth Cooley, Esq.
PIRES COOLEY
4401 Q. St. N.W.
Washington, DC 20007-2016
JAMES SCOTT FARRIN, Defendant, represented by Bradley M. Risinger
-- brad.risinger@smithmoorelaw.com -- at SMITH MOORE LEATHERWOOD,
LLP.
ANDREW H. MARKS, Defendant, represented by Keith J. Harrison --
kharrison@crowell.com -- at CROWELL & MORING, LLP & Michael L.
Kuppersmith -- mkuppersmith@crowell.com -- at CROWELL & MORING
LLP.
KANSAS POWER: Faces Class Action Over Solar-Panel Rebate Program
----------------------------------------------------------------
Jessica Shumaker, writing for St. Joseph News-Press, reports that
a St. Joseph man has filed a class-action suit against Kansas City
Power & Light, alleging that the company was negligent in its
oversight of its solar-panel rebate program and rebates were
improperly paid to a local vendor.
The suit, filed Aug. 15 in Buchanan County Circuit Court by
Richard Sharp, lists the St. Joseph-based vendor U.S. Solar, its
owner Trevor Dryden, Kansas City Power & Light Co. and KCP&L
Greater Missouri Operations Co. as defendants.
The 62-page petition for damages outlines three counts, including
alleged breach of contract, negligence and violation of the
Missouri Merchandising Act.
The petition states that Mr. Sharp and others took part in KCP&L's
Solar Electric Rebate Program, selecting U.S. Solar as the
installer of their solar electric systems. As such, they say they
entered into a contract with KCP&L that promised rebate payments
after KCP&L had verified that U.S. Solar had installed an
operational system.
The plaintiffs say U.S. Solar breached the contract by failing to
install operational systems. They also allege that KCP&L breached
the contract by failing to verify that the customers' systems were
operational before making rebate payments, by failing to inspect
the systems for compliance with approved specifications, paying
excessive rebates and paying the rebates to U.S. Solar before the
customers' systems were operational.
The petition said as a result, plaintiffs experienced damages of
paying "considerable sums of money" for inoperable systems, being
deprived of the opportunity to use or sell electricity generated,
not receiving the rebate promised by KCP&L and the eligibility to
further participate in the program and by the loss of tax credits.
Mr. Sharp and the class members also allege KCP&L was negligent in
its development, implementation and monitoring of the rebate
program. Actions singled out included approval of application of
U.S. Solar as an installer and failing to inspect systems, as well
as its handling of rebate payments.
They also allege U.S. Solar was negligent in installing inoperable
systems that could not be connected to KCP&L's electric system.
Lastly, the suit accuses the defendants of violating state law,
saying they "employed deception, fraud, made false promises,
misrepresentations and committed unfair practices" in
misrepresenting system specifications on program applications.
Chuck Caisley, vice president of marketing and public affairs at
KCP&L, said utility officials "vigorously deny" the allegations
outlined in the suit, adding that they believe they are without
merit.
"This was a transaction between two private parties," Mr. Caisley
said. "This is a resident who chose U.S. Solar and is now unhappy
with what happened between them and U.S. Solar. It has very little
to do with KCP&L.
"We didn't pick the (vendor), we didn't supervise the
construction, we had very little to do with this."
St. Joseph attorney John Spencer -- john.spencer@tshhlaw.com -- of
Tieman, Spencer, Hook & Hicks LLC, said attorneys are in the
process of identifying and contacting others who are eligible to
join. That number may be as many as more than 400 individuals or
businesses, according to the petition.
"If they've had an interaction with U.S. Solar and want to talk to
us, they're welcome to call us," he said. "We're happy to visit
with them and hear what their experience was like."
LIGAND PHARMACEUTICALS: Seeks to Dismiss Genaera Securities Suit
----------------------------------------------------------------
Ligand Pharmaceuticals Incorporated is awaiting a ruling by the
U.S. District Court for the Eastern District of Pennsylvania on it
motion to dismiss a securities suit filed on behalf of Genaera
Corporation shareholders, according to Ligand's Aug. 1, 2013, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2013.
On June 8, 2012, a federal securities class action and shareholder
derivative lawsuit was filed in the Eastern District of
Pennsylvania against Genaera Corporation and its officers,
directors, major shareholders and trustee ("Genaera Defendants")
for allegedly breaching their fiduciary duties to Genaera
shareholders.
The lawsuit also names the Company and its CEO John Higgins as
additional defendants for allegedly aiding and abetting the
Genaera Defendants' various breaches of fiduciary duties based on
the Company's purchase of a licensing interest in a development-
stage pharmaceutical drug program from the Genaera Liquidating
Trust in May 2010 and its subsequent sale of half of its interest
in the transaction to Biotechnology Value Fund, Inc.
On December 19, 2012, plaintiff filed an amended complaint
asserting substantially similar claims against the Company and Mr.
Higgins. The amended complaint seeks unspecified damages,
disgorgement, punitive damages, attorneys' fees and costs. On
February 4, 2013, the Company filed a motion to dismiss
plaintiff's amended complaint with prejudice.
Plaintiff filed an opposition to the motion to the Company's
motion to dismiss on May 3, 2013, and the Company filed its reply
brief on June 26, 2013. On July 10, 2013, the Court held a
hearing on Ligand and its co-defendants' motions to dismiss.
The Company intends to continue to vigorously defend against the
claims against it and Mr. Higgins in the lawsuit. Due to the
complex nature of the legal and factual issues involved, however,
the outcome of this matter is not presently determinable.
NETFLIX INC: Ejects Claim That It Misled Investors
--------------------------------------------------
Philip A. Janquart, writing for Courthouse News Service, reports
Netflix need not face claims that it inflated stock prices by
touting the prospects of its new "streaming-focused" business
model, a federal judge ruled.
After about eight years of delivering DVDs to customers through
the mail, Netflix began offering "streaming video" in 2007,
allowing customers to access video content on computers and
televisions.
At the time, customers could purchase a service package including
both methods of delivery for one fixed price. Netflix later split
the services and began charging separate prices for both,
eventually causing a drop in stock prices.
An announcement that the cable channel Starz did not plan to renew
its contract with Netflix, on top of a disclosure that the company
expected to lose a million subscribers in the third quarter of
2011, contributed to a 67 percent plunge in stock prices from
$298.73 per share in July 2011 to $169.25 by late September.
The Arkansas Teacher Retirement System and State-Boston Retirement
System filed a putative securities class action in 2012, claiming
Netflix misled them in statements and did not disclose enough
information about the prospects of streaming video.
Defendants to the San Francisco action included Netflix CEO Reed
Hastings, CFO David Wells and former CFO Barry McCarthy. They
faced claims under the Securities Exchange Act, Securities and
Exchange Commission rules and the Private Securities Litigation
Reform Act (PSLRA).
U.S. District Court Judge Samuel Conti ruled last week, however,
that statements Hastings made were too vague to for any investors
to rely on.
"In general, all of plaintiffs' claims, new and old, depend on the
tenuous theory that defendants withheld discrete and accurate
financial information about streaming while also touting
streaming's profitability," Conti said. "The court has not found
this to be the case for any statement plaintiffs cite. Plaintiffs
supply an array of vague, sometimes conclusory, statements to
support a theory that requires much more by virtue of its being
narrow and fact-sensitive. This is not enough to state a claim
under the PSLRA."
Netflix furthermore did not hide the fact the success of the
streaming model depended on other factors largely out of the
company's control, the court found.
"Plaintiffs do not plead plausible facts indicating that
defendants touted the streaming business's profitability as
opposed to the projected or hope-for strength of the interrelated
DVD and streaming business," Conti wrote. "Moreover, defendants
made clear throughout the class period that the success of a
streaming-focused business model was contingent on other factors,
suggesting that defendants did not omit any information or
warnings in a way that would be misleading under Rule 10b-5 [of
federal law]. None of what plaintiffs plead therefore shows that
defendants made any false or misleading statements about the
profitability of the streaming business."
Conti dismissed the complaint in its entirety with prejudice.
A copy of the 24-page order dated Aug. 20, 2013, is available from
Courthouse News Service at: http://is.gd/F5OVeP
NEW YORK, NY: Judge Barkett Dissents Stop-and-Frisk Searches
------------------------------------------------------------
Alyson M. Palmer, writing for Daily Report, reports that when
Judge Rosemary Barkett retires from the federal bench next month,
the U.S. Court of Appeals for the Eleventh Circuit will lose one
of its most prolific dissenters. Last week, Judge Barkett let out
a swan song of sorts, arguing that stop-and-frisk searches by
police, like the one upheld by the court in the case at hand,
jeopardize the rights of minorities and the poor.
"[T]he limited scope of our appellate review of Fourth Amendment
cases should not blind us to the significant harms to the
communities that bear the brunt of abusive stop-and-frisk
practices, including the erosion of individual liberty and
dignity, communal and racial stigmatization, and even the loss of
police legitimacy," Judge Barkett wrote.
She cited a federal judge's recent decision finding that the vast
majority of stops conducted by New York police between 2004 and
2012 did not result in an arrest or summons, and the vast majority
of frisks resulted in no weapons found.
Judge Barkett, 73, told the Daily Report last week that she plans
to leave the court Sept. 30 to take an appointment as a judge on
the Iran-U.S. Claims Tribunal in the Hague. The Aug. 20 dissent
was a reminder that the Eleventh Circuit will be losing one of its
strongest liberal voices.
Born in Mexico, Judge Barkett immigrated to Miami as a young
child. She has said that her parents, who were born in Syria,
opened a small grocery store and grew avocados. Judge Barkett
went on to be a nun, then chief justice of the Florida Supreme
Court. President Bill Clinton nominated her to the Eleventh
Circuit, and Judge Barkett weathered a difficult confirmation
fight over claims that she was too liberal on the death penalty
and other issues.
Judge Barkett's recent dissent was joined by one of President
Barack Obama's two appointees to the Eleventh Circuit, Beverly
Martin. But the panel opinion she and Judge Martin criticized was
authored by Obama's other appointee to the court, Judge Adalberto
Jordan.
Attempted Shoplifting Report
The opinions came out of a Jacksonville, Fla., case in which
Kareen Rasul Griffin is charged with being a felon in possession
of ammunition. Although it began with a call to police reporting
an attempted shoplifting, the case is about more than heady civil
rights principles; according to his lawyer, Griffin faces a 15-
year mandatory minimum prison sentence if convicted.
According to Jordan's panel opinion in the case, an officer
responded to a 911 call from a Jacksonville children's clothing
store in February 2011. When Officer Jay Edwards arrived at the
strip mall, a store security guard told him a man had attempted to
steal some clothing. The security guard pointed in the direction
of a man walking away from the store -- Mr. Griffin, who fit the
guard's description of "the black man in the green jacket and
jeans."
When Mr. Griffin disregarded Mr. Edwards' command to stop,
Mr. Edwards grabbed Mr. Griffin by the wrist and informed him he
was investigating a theft. Mr. Edwards patted Mr. Griffin down,
feeling what the officer later said he believed were batteries in
Mr. Griffin's back pocket. The officer asked Griffin why he had
batteries, and Mr. Griffin said they were actually shotgun shells.
Mr. Edwards asked Mr. Griffin if he had ever been to prison, and
Mr. Griffin said he had been. When Mr. Edwards informed
Mr. Griffin it was illegal for a felon to possess ammunition,
Mr. Griffin began to flee, but Mr. Edwards used his Taser to
subdue him, then arrested him.
Charged with being a felon in possession of ammo, Mr. Griffin
asked U.S. District Judge Roy Dalton Jr. to suppress the
ammunition and the statements he made to Mr. Edwards. Judge
Dalton granted the motion, saying that even assuming the frisk
were permissible at its inception, Mr. Edwards' questions about
the items in Mr. Griffin's pocket and whether he had been to
prison were not allowed because they were unrelated to either the
investigation of an attempted shoplifting or a frisk for weapons.
Prosecutors appealed, arguing that Judge Dalton had gone astray
when he focused on whether the officer's questions were related to
the initial purposes of the stop. Noting that the officer wasn't
done investigating the reported theft attempt when he asked
Mr. Griffin what was in his pocket and whether he had been to
jail, the government argued that only questions that unreasonably
extend the duration of a stop are unlawful.
Mr. Griffin's lawyers had conceded Mr. Edwards' initial stop of
Mr. Griffin was permissible under Terry v. Ohio, the 1968 Supreme
Court case that says an officer can briefly detain a person for
investigative purposes even if the officer's suspicions fall short
of probable cause the person committed a crime. But they
challenged Judge Dalton's assumption that the pat-down was valid,
saying Mr. Edwards didn't have the required suspicion that Mr.
Griffin was armed and dangerous. The panel of Jordan, then-Chief
Judge Joel Dubina and visiting Ninth Circuit Senior Judge Arthur
Alarcon agreed with prosecutors, reversing the district court in
October.
Jordan wrote that the totality of the circumstances permitted the
pat-down of Mr. Griffin, saying that Mr. Edwards was alone at
night in a "high crime area." Jordan added that Mr. Griffin had
acted "evasively" and refused to obey Mr. Edwards' command to
stop.
Issue of First Impression
The panel rejected the district court judge's conclusion that
Mr. Edwards' questioning of Mr. Griffin went too far. Saying the
panel was deciding a question of first impression for the circuit,
Jordan said the court was joining all other circuits that had
decided the issue and concluding that an officer can pose
questions unrelated to the initial purpose of a Terry stop unless
they "measurably extend the duration of the stop."
Mr. Griffin's lawyers filed a motion asking the panel to look at
the case again. Instead, one of the court's judges asked the full
court to consider the matter, but that judge could not gather the
majority needed to bring the case before the court en banc.
No judge wrote to defend the court's decision, with just
Judge Barkett and Judge Martin registering their disagreement.
Judge Barkett took issue with the panel's reliance on both
Mr. Griffin's acting "evasively" and his presence in a high-crime
neighborhood as justifying the pat-down. "[T]here are often
innocent reasons for walking away, even briskly, from a police
officer," she wrote.
"The vast majority of people that live, work, or travel through
high-crime neighborhoods do not participate in any criminal
activities, much less activities that put officers and other
community members at risk," she added.
"Moreover," she wrote, citing a law review article and various
studies, "because neighborhoods described as 'high-crime' are
almost always poor communities of color, excessively-broad police
discretion to frisk suspects in such neighborhoods facilitates the
disproportionate targeting of poor people of color by law
enforcement, contributing to unjustifiable levels of racial and
socioeconomic disparities in the criminal justice system."
Barkett: Step Toward Loss of Rights
Perhaps responding to private arguments from her colleagues that
the case was too fact-specific or routine to merit en banc review,
Judge Barkett quoted a Seventh Circuit judge's dissent that said
the erosion of Fourth Amendment rights comes in small steps taken
in such cases. "This decision is one of those steps," wrote
Judge Barkett. "It far exceeds the carefully drawn limits on
police discretion established in Terry and threatens to justify
pat-down searches of individuals suspected of even the most minor
non-violent crimes, as long as they are present in a 'high-crime
neighborhood.'"
The appellate chief for the U.S. attorney's office for the Middle
District of Florida, David Rhodes, said his office wouldn't
comment on the dissent, referring to arguments made in
prosecutors' briefs. "We're pleased that the court didn't grant
en banc review," said Rhodes, whose Jacksonville colleague,
Patricia Barksdale, handled the oral argument before the panel.
Sylvia Irvin, an assistant federal public defender in Jacksonville
who argued the case at the Eleventh Circuit for Mr. Griffin, said
her side would ask the U.S. Supreme Court to look at the case.
"I'm hopeful that the dissent will lay the groundwork for the
granting of a writ of certiorari," said Irvin, adding that the
decision came at a good time because this week she would be
completing the last of twice-monthly furlough days that have
plagued her office since April.
The case is United States v. Griffin, No. 11-15558.
PDC ENERGY: 2014 Trial Set in Suit Over Partnership Purchases
-------------------------------------------------------------
The U.S. District Court for the Central District of California
approved a litigation schedule, including a jury trial in May
2014, for a suit filed against PDC Energy, Inc. on behalf of
certain former partnership unit holders, according to the
company's Aug. 1, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended June 30, 2013.
On December 21, 2011 the Company and its wholly-owned merger
subsidiary were served with an alleged class action on behalf of
certain former partnership unit holders, related to its
partnership repurchases completed by mergers in 2010 and 2011.
The action was filed in U.S. District Court for the Central
District of California and is titled Schulein v. Petroleum
Development Corp. The complaint primarily alleges that the
disclosures in the proxy statements issued in connection with the
mergers were inadequate, and a state law breach of fiduciary duty.
On June 15, 2012, the Court denied the Company's motion to dismiss
and approved a litigation schedule including a jury trial in May
2014. We have not recorded a liability for claims pending because
we believe we have good legal defenses to the asserted claims and
because the plaintiffs have not specified damages and it is not
possible for management to reasonably estimate what, if any,
monetary damages could result from this claim.
PITNEY BOWES: Lawsuit by Health & Welfare Fund Now Concluded
------------------------------------------------------------
The suit NECA-IBEW Health & Welfare Fund v. Pitney Bowes Inc. et
al., a class action lawsuit filed in the U.S. District Court for
the District of Connecticut, has now concluded, according to the
company's Aug. 1, 2013, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended June 30, 2013.
In October 2009, the company and certain of its current and former
officers were named as defendants in NECA-IBEW Health & Welfare
Fund v. Pitney Bowes Inc. et al., a class action lawsuit filed in
the U.S. District Court for the District of Connecticut.
The complaint asserts claims under the Securities Exchange Act of
1934 on behalf of those who purchased the common stock of the
company during the period between July 30, 2007 and October 29,
2007 alleging that the company, in essence, missed two financial
projections. Plaintiffs filed an amended complaint in September
2010. On March 23, 2013, the Court granted our motion to dismiss,
and dismissed the case in its entirety. Plaintiff did not appeal
the decision, and therefore, this case has now concluded in favor
of Pitney Bowes and its officers named in the lawsuit.
REYNOLDS AMERICAN: 7 Cases Set for Trial for June 2013-2014
-----------------------------------------------------------
There are seven cases, exclusive of Engle Progeny cases, scheduled
for trial as of June 30, 2013 through June 30, 2014, for RJR
Tobacco or its affiliates and indemnitees, including one class-
action, according to Reynolds American Inc.'s July 24, 2013, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2013.
Trial schedules are subject to change, and many cases are
dismissed before trial. It is likely that RJR Tobacco and other
cigarette manufacturers will continue to have a similar number of
tobacco-related trials in 2013 as it has had in recent years.
There are seven cases, exclusive of Engle Progeny cases, scheduled
for trial as of June 30, 2013 through June 30, 2014, for RJR
Tobacco or its affiliates and indemnitees: one non-smoking and
health case, five individual smoking and health cases, and one
class-action. There are 54 Engle Progeny cases against RJR Tobacco
and/or Brown & Williamson Holdings, Inc. (B&W) set for trial
through June 30, 2014, but it is not known how many of these cases
will actually be tried.
REYNOLDS AMERICAN: Asks Fla. Court to Fix Post-Settlement Issues
----------------------------------------------------------------
RJR Tobacco and the plaintiff in Soffer v. R. J. Reynolds Tobacco
Co. filed notices to invoke the discretionary jurisdiction of the
Florida Supreme Court to resolve issues after the settlement of
the case, according to Reynolds American Inc.'s July 24, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended June 30, 2013.
On June 16, 2011, in Soffer v. R. J. Reynolds Tobacco Co., a case
filed in December 2007, in the Circuit Court, Alachua County,
Florida, a jury returned a verdict in favor of the plaintiff,
found RJR Tobacco to be 40% at fault, the decedent, Maurice
Soffer, to be 60% at fault, and awarded $5 million in compensatory
damages and no punitive damages.
The plaintiff alleged that the decedent was addicted to cigarettes
and, as a result, developed lung cancer and other smoking related
conditions and/or diseases. Final judgment was entered against RJR
Tobacco in the amount of $2 million. The plaintiff filed a notice
of appeal to the First DCA in July 2011.
RJR Tobacco filed a notice of cross appeal and posted a
supersedeas bond in the amount of $2 million. In October 2012, the
First DCA affirmed the trial court's ruling in full. On the direct
appeal, the court held that only intentional torts could support a
punitive damages claim and held that Engle Progeny plaintiffs may
not seek punitive damages for negligence or strict liability
because the original Engle class did not seek punitive damages for
those claims.
The First DCA certified the question to the Florida Supreme Court
as one of great public importance. On the cross appeal, the court
rejected RJR Tobacco's arguments about the use of the Engle
findings and the statute of limitations. RJR Tobacco filed a
motion for rehearing or for certification to the Florida Supreme
Court and the plaintiff filed a motion for rehearing or rehearing
en banc.
In January 2013, the First DCA granted rehearing on RJR Tobacco's
cross appeal to clarify that the trial court's application of
Engle findings did not violate RJR Tobacco's due process rights.
Otherwise, rehearing, rehearing en banc and certification were
denied. RJR Tobacco and the plaintiff have both filed notices to
invoke the discretionary jurisdiction of the Florida Supreme
Court. Decisions are pending.
REYNOLDS AMERICAN: Awaits Ruling on Appeal in "Ciccone" Suit
------------------------------------------------------------
A decision is pending on an appeal filed by RJR Tobacco in Ciccone
v. R. J. Reynolds Tobacco Co. after the jury awarded approximately
$3.2 million in compensatory damages to the decedent, according to
Reynolds American Inc.'s July 24, 2013, Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarter ended June
30, 2013.
On July 15, 2011, in Ciccone v. R. J. Reynolds Tobacco Co., a case
filed in August 2004, in the Circuit Court, Broward County,
Florida, a jury returned a verdict finding the plaintiff is a
member of the Engle class. The plaintiff alleged that as a result
of the use of the defendant's tobacco products, the decedent,
George Ciccone, suffered from nicotine addiction and one or more
smoking related diseases and/or medical conditions.
On July 21, 2011, the jury awarded approximately $3.2 million in
compensatory damages and $50,000 in punitive damages. The jury
found the decedent to be 70% at fault and RJR Tobacco to be 30% at
fault. Final judgment was entered in September 2011, and
RJR Tobacco filed a notice of appeal to the Fourth DCA. RJR
Tobacco posted a supersedeas bond in the amount of approximately
$1 million on October 17, 2011. Oral argument occurred on
June 25, 2013. A decision is pending.
REYNOLDS AMERICAN: Reports 2574 Broin II Cases as of June 30
------------------------------------------------------------
As of June 30, 2013, there are 2,574 Broin II lawsuits pending in
Florida and there have been no Broin II trials since 2007,
according to Reynolds American Inc.'s July 24, 2013, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2013.
RJR Tobacco, Brown & Williamson Holdings, Inc. (B&W) and other
cigarette manufacturer defendants settled Broin v. Philip Morris,
Inc. in October 1997. This case had been brought in Florida state
court on behalf of flight attendants alleged to have suffered from
diseases or ailments caused by exposure to environmental tobacco
smoke (ETS) in airplane cabins.
The settlement agreement required the participating tobacco
companies to pay a total of $300 million in three annual $100
million installments, allocated among the companies by market
share, to fund research on the early detection and cure of
diseases associated with tobacco smoke.
It also required those companies to pay a total of $49 million for
the plaintiffs' counsel's fees and expenses. RJR Tobacco's portion
of these payments was approximately $86 million; B&W's portion of
these payments was approximately $57 million. The settlement
agreement bars class members from bringing aggregate claims or
obtaining punitive damages and also bars individual claims to the
extent that they are based on fraud, misrepresentation, conspiracy
to commit fraud or misrepresentation, RICO, suppression,
concealment or any other alleged intentional or willful conduct.
The defendants agreed that, in any individual case brought by a
class member, the defendant will bear the burden of proof with
respect to whether environmental tobacco smoke (ETS) can cause
certain specifically enumerated diseases, referred to as "general
causation." With respect to all other issues relating to
liability, including whether an individual plaintiff's disease was
caused by his or her exposure to ETS in airplane cabins, referred
to as "specific causation," the individual plaintiff will have the
burden of proof. On September 7, 1999, the Florida Supreme Court
approved the settlement. The Broin II cases arose out of the
settlement of this case.
On October 5, 2000, the Broin court entered an order applicable to
all Broin II cases that the terms of the Broin settlement
agreement do not require the individual Broin II plaintiffs to
prove the elements of strict liability, breach of warranty or
negligence. Under this order, there is a rebuttable presumption
in the plaintiffs' favor on those elements, and the plaintiffs
bear the burden of proving that their alleged adverse health
effects actually were caused by exposure to ETS in airplane
cabins, that is, specific causation.
As of June 30, 2013, there were 2,574 Broin II lawsuits pending in
Florida. There have been no Broin II trials since 2007.
REYNOLDS AMERICAN: RJR Tobacco Faces 8 Class Suits as of June
-------------------------------------------------------------
As of June 30, 2013, eight class-action cases are pending in the
United States against RJR Tobacco or its affiliates or
indemnitees, according to Reynolds American Inc.'s July 24, 2013,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended June 30, 2013.
In 1996, the Fifth Circuit Court of Appeals in Castano v. American
Tobacco Co. overturned the certification of a nation-wide class of
persons whose claims related to alleged addiction to tobacco
products. Since this ruling by the Fifth Circuit, most class-
action suits have sought certification of state-wide, rather than
nation-wide, classes.
Class-action suits based on claims similar to those asserted in
Castano or claims that class members are at a greater risk of
injury or injured by the use of tobacco or exposure to
environmental tobacco smoke (ETS) are pending against RJR Tobacco
and its affiliates and indemnitees in state or federal courts in
California, Illinois, Louisiana, Missouri, and West Virginia.
The pending class actions against RJR Tobacco or its affiliates or
indemnitees include four cases alleging that the use of the term
"lights" constitutes unfair and deceptive trade practices under
state law or violates the federal RICO statute. Such suits are
pending in state or federal courts in Illinois and Missouri and
are discussed under "-- 'Lights' Cases."
Finally, certain third-party payers have filed health-care cost
recovery actions in the form of class actions. These cases are
discussed under "-- Health-Care Cost Recovery Cases."
Few smoker class-action complaints have been certified or, if
certified, have survived on appeal. Eighteen federal courts,
including two courts of appeals, and most state courts that have
considered the issue have rejected class certification in such
cases. Apart from the Castano case, only two smoker class actions
have been certified by a federal court -- In re Simon (II)
Litigation, and Schwab [McLaughlin] v. Philip Morris USA, Inc.,
both of which were filed in the U.S. District Court for the
Eastern District of New York and ultimately decertified.
REYNOLDS AMERICAN: June 2014 Trial Set in Camel Cash Cert. Suit
---------------------------------------------------------------
Trial is scheduled for June 3, 2014 in Sateriale v. R. J. Reynolds
Tobacco Co., a class action brought on behalf of all persons who
tried unsuccessfully to redeem Camel Cash certificates at a
purported class period, according to Reynolds American Inc.'s July
24, 2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2013.
In Sateriale v. R. J. Reynolds Tobacco Co., a class action filed
in November 2009 in the U.S. District Court for the Central
District of California, the plaintiffs brought the case on behalf
of all persons who tried unsuccessfully to redeem Camel Cash
certificates from 1991 through March 31, 2007, or who held Camel
Cash certificates as of March 31, 2007.
The plaintiffs allege that in response to the defendants' action
to discontinue redemption of Camel Cash as of March 31, 2007,
customers, like the plaintiffs, attempted to exchange their Camel
Cash for merchandise and that the defendants, however, did not
have any merchandise to exchange for Camel Cash. The plaintiffs
allege unfair business practices, deceptive practices, breach of
contract and promissory estoppel. The plaintiffs seek injunctive
relief, actual damages, costs and expenses. In January 2010, the
defendants filed a motion to dismiss, which prompted the
plaintiffs to file an amended complaint in February 2010.
The class definition changed to a class consisting of all persons
who reside in the U.S. and tried unsuccessfully to redeem Camel
Cash certificates, from October 1, 2006 (six months before the
defendant ended the Camel Cash program) or who held Camel Cash
certificates as of March 31, 2007. The plaintiffs also brought the
class on behalf of a proposed California subclass, consisting of
all California residents meeting the same criteria. In May 2010,
RJR Tobacco's motion to dismiss the amended complaint for lack of
jurisdiction over subject matter and, alternatively, for failure
to state a claim was granted with leave to amend. The plaintiffs
filed a second amended complaint.
In July 2010, RJR Tobacco's motion to dismiss the second amended
complaint was granted with leave to amend. The plaintiffs filed a
third amended complaint, and RJR Tobacco filed a motion to dismiss
in September 2010. In December 2010, the court granted RJR
Tobacco's motion to dismiss with prejudice. Final judgment was
entered by the court, and the plaintiffs filed a notice of appeal,
in January 2011.
In July 2012, the appellate court affirmed the dismissal of the
plaintiffs' claims under the Unfair Competition Law and the
Consumer Legal Remedies Acts and reversed the dismissal of the
plaintiffs' claims for promissory estoppel and breach of contract.
RJR Tobacco's motion for rehearing or rehearing en banc was denied
in October 2012. RJR Tobacco filed its answer to the plaintiffs'
third amended complaint in December 2012. Trial is scheduled for
June 3, 2014.
REYNOLDS AMERICAN: Appeal v. "Lights" Cases Dismissal Continues
---------------------------------------------------------------
Briefing is underway in the appeal of the "Lights" plaintiffs in
relation to a two-year time limit for filing a petition for relief
from a final judgment dismissing the cases, according to Reynolds
American Inc.'s July 24, 2013, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2013.
"Lights" class-action cases are pending against RJR Tobacco or
Brown & Williamson Holdings, Inc. (B&W) in Illinois (2) and
Missouri (2). The classes in these cases generally seek to recover
$50,000 to $75,000 per class member for compensatory and punitive
damages, injunctive and other forms of relief, and attorneys' fees
and costs from RJR Tobacco and/or B&W.
In general, the plaintiffs allege that RJR Tobacco or B&W made
false and misleading claims that "lights" cigarettes were lower in
tar and nicotine and/or were less hazardous or less mutagenic than
other cigarettes. The cases typically are filed pursuant to state
consumer protection and related statutes.
Many of these "lights" cases were stayed pending review of the
Good v. Altria Group, Inc. case by the U.S. Supreme Court. In that
"lights" class-action case against Altria Group, Inc. and Philip
Morris USA, the U.S. Supreme Court decided that these claims are
not preempted by the Federal Cigarette Labeling and Advertising
Act or by the Federal Trade Commission's, referred to as FTC,
historic regulation of the industry. Since this decision in
December 2008, a number of the stayed cases have become active
again.
The seminal "lights" class-action case involves RJR Tobacco's
competitor, Philip Morris, Inc. Trial began in Price v. Philip
Morris, Inc. in January 2003. In March 2003, the trial judge
entered judgment against Philip Morris in the amount of $7.1
billion in compensatory damages and $3 billion in punitive
damages. Based on Illinois law, the bond required to stay
execution of the judgment was set initially at $12 billion. Philip
Morris pursued various avenues of relief from the $12 billion bond
requirement.
On December 15, 2005, the Illinois Supreme Court reversed the
lower court's decision and sent the case back to the trial court
with instructions to dismiss the case. On December 5, 2006, the
trial court granted the defendant's motion to dismiss and for
entry of final judgment. The case was dismissed with prejudice the
same day. In December 2008, the plaintiffs filed a petition for
relief from judgment, stating that the U.S. Supreme Court's
decision in Good v. Altria Group, Inc. rejected the basis for the
reversal.
The trial court granted the defendant's motion to dismiss the
plaintiffs' petition for relief from judgment in February 2009. In
March 2009, the plaintiffs filed a notice of appeal to the
Illinois Appellate Court, Fifth Judicial District, requesting a
reversal of the February 2009 order and remand to the circuit
court. On February 24, 2011, the appellate court entered an order,
concluding that the two-year time limit for filing a petition for
relief from a final judgment began to run when the trial court
dismissed the plaintiffs' lawsuit on December 18, 2006.
The appellate court therefore found that the petition was timely,
reversed the order of the trial court, and remanded the case for
further proceedings. Philip Morris filed a petition for leave to
appeal to the Illinois Supreme Court. On September 28, 2011, the
Illinois Supreme Court denied Philip Morris's petition for leave
to appeal and returned the case to the trial court for further
proceedings. In December 2012, the trial court denied the
plaintiffs' petition for relief from the judgment. The plaintiffs
filed a notice of appeal to the Illinois Appellate Court, Fifth
Judicial District. Briefing is underway.
SAXON MORTGAGE: Court Certifies Class in "Gaudin" Suit
------------------------------------------------------
District Judge Jon S. Tigar granted a motion for class
certification and appointment of class counsel, and set the case
management conference in MARIE GAUDIN, Plaintiff, v. SAXON
MORTGAGE SERVICES, INC., Defendant, CASE NO. 11-CV-01663-JST,
(N.D. Cal.).
Plaintiff Marie Gaudin alleges that Defendant Saxon Mortgage
Services, Inc. offered her a Trial Period Plan (TPP) loan
modification document pursuant to the federal Homeowners
Affordable Modification Program (HAMP), and then unjustifiably
failed to deliver on promises contained within the document.
The Plaintiff has moved to certify a class of California borrowers
who entered into HAMP TPPs with the Defendant through October 1,
2009, and made at least three trial period payments, but did not
receive HAMP loan modifications.
Judge Tigar granted the request. The Court also granted the
Plaintiff's motion to appoint Daniel Mulligan, Esq. of Jenkins
Mulligan & Gabriel LLP and Peter Fredman, Esq. of the Law Office
of Peter Fredman, as counsel for the aforementioned class.
A copy of the District Court's August 5, 2013 Order is available
at http://is.gd/ipGu7Tfrom Leagle.com.
Marie Gaudin, Plaintiff, represented by Daniel Joseph Mulligan --
dan@jmglawoffices.com -- at Jenkins Mulligan & Gabriel LLP & Peter
B. Fredman -- peter@peterfredmanlaw.com -- at Law Office of Peter
Fredman.
Saxon Mortgage Services, Inc., Defendant, represented by Erik
Wayne Kemp -- ek@severson.com -- at Severson & Werson, Regina Jill
McClendon -- rmcclendon@lockelord.com -- at Locke Lord LLP,
Jeanette Viggiano Torti -- jeanette.torti@bingham.com -- at
Bingham McCutchen, LLP & Laila Abou-Rahme --
laila.abou-rahme@bingham.com -- at Bingham McCuthen, LLP.
SEARS HOLDINGS: Appeals Court Upholds Washing Machine Class Status
------------------------------------------------------------------
Chicago Tribune reports that a federal appeals court has upheld
class-action status of a lawsuit alleging Sears sold defective
Kenmore brand washing machines that accumulate mold and musty
odors.
The case was originally brought against the Hoffman Estates-based
retailer in 2006 by customers in six states. One group of
consumers claimed that the front-loading machines, with low water
level and low water temperature, did not clean themselves
adequately. They said that as a result mold built up in the drum
and emitted a bad odor.
A second group of consumers said a defect in the control unit
caused the machines to stop mid-cycle.
Sears argued that the customers claiming mold problems could not
sue together because machines were designed and modified
differently enough by their manufacturer, Whirlpool Corp.
The federal appeals court ruled on Aug. 22 after being asked to
reconsider the case by the U.S. Supreme Court.
SPARTAN STORES: Faces Suit Over Merger With Nasch Finch Company
---------------------------------------------------------------
On July 21, 2013, Spartan Stores, Inc. entered into an Agreement
and Plan of Merger providing for the merger of Spartan Stores and
Nash Finch Company.
On July 24, 2013, a class action suit was commenced in Minnesota
state court by Gordon Greenblatt against Nash-Finch Company, its
board of directors, and Spartan Stores, Inc., according to
Spartan's financial report for the quarterly period ended June 22,
2013 filed with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2013.
The suit claims that the Nash-Finch board breached their fiduciary
duties by approving the merger transaction, and asserts that
Spartan Stores aided and abetted this asserted breach of fiduciary
duty.
The suit seeks an injunction against consummation of the merger,
as well as an order that the defendants be directed to repay to
Nash-Finch all damages it has incurred by virtue of the asserted
breaches of fiduciary duty.
TOYOTA MOTOR: Five Class Members Appeal Settlement Approval
-----------------------------------------------------------
Amanda Bronstad, writing for The National Law Journal, reports
that five class members have appealed the recent approval of a
$1.6 billion settlement between Toyota and thousands of consumers
who claim to have lost value on their vehicles following the 2010
recalls for sudden acceleration defects.
Two class members, Maryland residents Allen Snyder and Linton
Weeks, filed a petition on Aug. 21 with the U.S. Court of Appeals
for the Ninth Circuit challenging U.S. District Judge James
Selna's July 24 approval of the deal. They previously objected
that a provision granting $30 million to an automotive research
fund essentially endorsed Toyota position that drivers were to
blame for accidents, not defects in the electronic throttle
control system of their vehicles -- the dispute at the heart of
the litigation.
Two Colorado class members, Gary and Rebecca Guerriero, filed a
notice on Aug. 22 that they would appeal final approval of the
settlement. The Guerrieros previously objected to numerous
aspects of the deal, including the research fund and $227 million
in attorney fees and costs to 31 plaintiffs' firms. A fifth
objector, Clarence Morrison, who is from Texas, indicated in a
notice of appeal filed on Aug. 22 that he planned to challenge the
fees.
Toyota spokeswoman Carly Schaffner, in an emailed statement,
wrote: "This settlement provides significant value to our
customers and is in the best interests of all affected parties. We
believe that Judge Selna properly approved the settlement and that
any appeals are without merit."
Clarence Ditlow, executive director of the Center for Auto Safety,
a nonprofit organization in Washington founded by consumer
advocate Ralph Nader and the Consumers Union, who filed a
declaration supporting the Maryland objectors, issued a written
statement on Aug. 21: "The lawsuit relates to defective electronic
control systems and Toyota's cover-up of the defects by blaming
driver error. To provide funding for driver education legitimizes
Toyota's cover-up."
He told The National Law Journal: "We'll argue that in fact the
$30 million has to be considered a cy pres fund, and as a cy pres
fund it doesn't benefit the members of the class. It benefits
Toyota by blaming the driver and saying we need more driver
education."
He noted that Mark Saylor, who was killed in 2009 when his rented
Lexus crashed after speeding down a San Diego highway, had 19
years of experience as a California Highway Patrol officer.
Toyota paid $10 million to settle his family's lawsuit.
"He had years of driver training, hands-on and courses, and he
couldn't' handle an emergency situation," he said.
An attorney for the objectors, Mark Chavez --
mark@chavezgertler.com -- of Chavez & Gertler in Mill Valley,
Calif., did not return a call for comment.
The settlement resolves claims by consumers that their cars lost
value following the highly publicized recalls of about 10 million
vehicles due to defective floor mats and gas pedals. The
plaintiffs asserted that the recalls failed to fix the sudden
acceleration problems, which they alleged were due to defects in
the electronic throttle control systems. The settlement covers
class members who own or lease 16 models of Toyota, including the
Camry and Corolla, nine Lexus models and three Scion models. The
model years range from 1998 to 2010.
Judge Selna, who is overseeing the multidistrict litigation
against Toyota in Santa Ana, Calif., initially raised concerns
about whether an estimated $350 million in spillover cash would go
to consumers. The excess funds became an issue because so few
class members submitted claims.
The original settlement called for the spillover cash to go toward
administrative costs and the research fund. But the revised deal
limited the research fund to $30 million and increased the
opportunities for class members to obtain the spillover cash.
In approving the deal, Judge Selna rejected concerns from
objectors about the research fund. He also ruled that the fund
did not qualify as a cy pres distribution because it would not
come out of the cash portions of the settlement. Cy pres funds,
designed to distribute unclaimed money in a settlement after class
members have been paid, have been under scrutiny by the Ninth
Circuit, which last year threw out a class settlement with Kellogg
Co. because a cy pres fund had no nexus to the consumer claims.
Mr. Ditlow said the Dennis v. Kellogg Co. decision would play a
role in the objectors' appeal.
"It's a fairly limited appeal, but if you look at the Kellogg
decision in the Ninth Circuit, where they challenged a cy pyres
award also, the court threw out the whole settlement," he said.
Judge Selna issued a tentative order on Aug. 19 rejecting a
request for attorney fees by three other objectors. Those
objectors, represented by Ben Barnow of Barnow and Associates in
Chicago, had raised concerns about the research fund, among other
things. Mr. Barnow was seeking $8.25 million in fees and $9,225
in costs. The three objectors sought $6,000 in awards.
Judge Selna concluded that Mr. Barnow's suggestion that his
clients were responsible for the changes to the settlement "vastly
overstates the significance of counsel's contribution on this
point."
VECTOR GROUP: Engle Cases Reach 4,300 as of June 2013
-----------------------------------------------------
As of June 30, 2013, Liggett Group LLC and Vector Group Ltd. are
named defendants in 4,300 Engle progeny cases in both federal
(1,257 cases) and state (3,043 cases) courts in Florida,
according to Vector's Aug. 1, 2013, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2013.
In May 1994, Engle was filed against Liggett and others in Miami-
Dade County, Florida. The class consisted of all Florida residents
who, by November 21, 1996, "have suffered, presently suffer or
have died from diseases and medical conditions caused by their
addiction to cigarette smoking."
In July 1999, after the conclusion of Phase I of the trial, the
jury returned a verdict against Liggett and other cigarette
manufacturers on certain issues determined by the trial court to
be "common" to the causes of action of the plaintiff class. The
jury made several findings adverse to the defendants including
that defendants' conduct "rose to a level that would permit a
potential award or entitlement to punitive damages."
Phase II of the trial was a causation and damages trial for three
of the class plaintiffs and a punitive damages trial on a class-
wide basis before the same jury that returned the verdict in Phase
I. In April 2000, the jury awarded compensatory damages of $12,704
to the three class plaintiffs, to be reduced in proportion to the
respective plaintiff's fault. In July 2000, the jury awarded
approximately $145,000,000 in punitive damages, including $790,000
against Liggett.
In May 2003, Florida's Third District Court of Appeal reversed the
trial court and remanded the case with instructions to decertify
the class. The judgment in favor of one of the three class
plaintiffs, in the amount of $5,831, was overturned as time barred
and the court found that Liggett was not liable to the other two
class plaintiffs.
In July 2006, the Florida Supreme Court affirmed the decision
vacating the punitive damages award and held that the class should
be decertified prospectively, but determined that the following
Phase I findings are entitled to res judicata effect in Engle
progeny cases:
(i) that smoking causes lung cancer, among other diseases;
(ii) that nicotine in cigarettes is addictive;
(iii) that defendants placed cigarettes on the market that were
defective and unreasonably dangerous;
(iv) that defendants concealed material information knowing that
the information was false or misleading or failed to disclose a
material fact concerning the health effects or addictive nature of
smoking;
(v) that defendants agreed to conceal or omit information
regarding the health effects of cigarettes or their addictive
nature with the intention that smokers would rely on the
information to their detriment;
(vi) that defendants sold or supplied cigarettes that were
defective; and
(vii) that defendants were negligent.
The Florida Supreme Court decision also allowed former class
members to proceed to trial on individual liability issues and
compensatory and punitive damage issues, provided they filed their
individual lawsuits by January 2008. In December 2006, the Florida
Supreme Court added the finding that defendants sold or supplied
cigarettes that, at the time of sale or supply, did not conform to
the representations made by defendants. In October 2007, the
United States Supreme Court denied defendants' petition for writ
of certiorari.
Pursuant to the Florida Supreme Court's July 2006 ruling in Engle,
which decertified the class on a prospective basis, and affirmed
the appellate court's reversal of the punitive damages award,
former class members had until January 2008 in which to file
individual lawsuits.
As of June 30, 2013, Liggett and the Company are named defendants
in 4,300 Engle progeny cases in both federal (1,257 cases) and
state (3,043 cases) courts in Florida. These cases include
approximately 5,481 plaintiffs.
Other cigarette manufacturers are also named as defendants in
these cases, although as a case proceeds, one or more defendants
may ultimately be dismissed from the action. The number of state
court Engle progeny cases may increase as multi-plaintiff cases
continue to be severed into individual cases. The number of
federal cases may increase as plaintiffs have appealed the
dismissal of over 800 cases by the federal court. The total number
of plaintiffs may also increase as a result of attempts by
existing plaintiffs to add additional parties. Although the
Company was not named as a defendant in the Engle case, it has
been named as a defendant in most of the Engle progeny cases where
Liggett is named as a defendant.
Engle Progeny Cases
As of June 30, 2013, there were 4,300 Engle progeny cases, 63
individual product liability lawsuits, four purported class
actions and one healthcare cost recovery action pending in the
United States in which Liggett or the company or both, were named
as a defendant. To date, adverse verdicts have been entered
against Liggett in ten Engle progeny cases.
In 2000, a jury in Engle v. R.J. Reynolds Tobacco Co. rendered a
$145,000,000 punitive damages verdict in favor of a "Florida
Class" against certain cigarette manufacturers, including Liggett.
Pursuant to the Florida Supreme Court's July 2006 ruling in Engle,
which decertified the class on a prospective basis, and affirmed
the appellate court's reversal of the punitive damages award,
former class members had one year from January 11, 2007 in which
to file individual lawsuits.
In addition, some individuals who filed suit prior to January 11,
2007, and who claim they meet the conditions in Engle, are
attempting to avail themselves of the Engle ruling. Lawsuits by
individuals requesting the benefit of the Engle ruling, whether
filed before or after the January 11, 2007 deadline, are referred
to as the "Engle progeny cases."
Liggett and the company are currently named in 4,300 Engle progeny
cases in both federal (1,257 cases) and state (3,043 cases) courts
in Florida. Other cigarette manufacturers have also been named as
defendants in these cases, although as a case proceeds, one or
more defendants may ultimately be dismissed from the action. These
cases include approximately 5,481 plaintiffs.
VECTOR GROUP: Liggett Named in Four Purported Collective Suits
--------------------------------------------------------------
As of June 30, 2013, there were four actions pending for which
either a class had been certified or plaintiffs were seeking class
certification, where Liggett Group LLC is a named defendant,
including one alleged price fixing case, according to Vector Group
Ltd.'s Aug. 1, 2013, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2013.
In Jimmie Lee Brown, a state court case against R.J. Reynolds, the
trial court tried the case in two phases. In the first phase, the
jury determined that the smoker was addicted to cigarettes that
contained nicotine and that his addiction was a legal cause of his
death, thereby establishing he was an Engle class member.
In the second phase, the jury determined whether the plaintiff
established legal cause and damages with regard to each of the
underlying claims. The jury found in favor of plaintiff in both
phases.
In September 2011, the Fourth District Court of Appeal affirmed
the judgment entered in plaintiff's favor and approved the trial
court's procedure of bifurcating the trial. The Fourth District
Court of Appeal agreed with Martin that individual post-Engle
plaintiffs need not prove conduct elements as part of their burden
of proof, but disagreed with Martin to the extent that the First
District Court of Appeal only required a finding that the smoker
was a class member to establish legal causation as to addiction
and the underlying claims.
The Fourth District Court of Appeal held that in addition to
establishing class membership, Engle progeny plaintiffs must also
establish legal causation and damages as to each claim asserted.
In so finding, the Fourth District Court of Appeal's decision in
Jimmie Lee Brown is in conflict with Martin.
In dicta, the Fourth District Court of Appeal further voiced
concern that the preclusive effect of the Engle findings violates
the tobacco company defendants' due process rights and, in the
special concurring opinion, the court emphasized that until the
Florida Supreme Court gives trial courts guidance as to what it
intended by its Engle decision, trial courts will continue to play
"a form of legal poker."
In September 2011, R.J. Reynolds filed a motion asking the Fourth
District Court of Appeal to certify the case to the Florida
Supreme Court for review. The motion was denied in October 2011.
In the Rey case, a state court Engle progeny case, the trial court
entered final summary judgment on all claims in favor of the
Company, Liggett and Lorillard based on what has been referred to
in the Engle progeny litigation as the "Liggett Rule."
The Liggett Rule stands for the proposition that a manufacturer
cannot have liability to a smoker under any asserted claim if the
smoker did not use a product manufactured by that particular
defendant. The Liggett Rule is based on the entry of final
judgment in favor of Liggett/Brooke Group in Engle on all of the
claims asserted against them by class representatives Mary Farnan
and Angie Della Vecchia, even though the Florida Supreme Court
upheld, as res judicata, the generic finding that Liggett/Brooke
Group engaged in a conspiracy to commit fraud by concealment.
In September 2011, the Third District Court of Appeal affirmed in
part and reversed in part holding that the defendants were
entitled to summary judgment on all claims asserted against them
other than the claim for civil conspiracy. Defendants' motions
for rehearing were denied with regard to the Liggett Rule issues.
Defendants sought further review by the Florida Supreme Court and
on August 20, 2012, the petition for review was denied. In March
2012, the Fifth District Court of Appeal, in other progeny cases,
followed the Class Actions.
As of June 30, 2013, there were four actions pending for which
either a class had been certified or plaintiffs were seeking class
certification, where Liggett is a named defendant, including one
alleged price fixing case. Other cigarette manufacturers are also
named in these actions.
Plaintiffs' allegations of liability in class action cases are
based on various theories of recovery, including negligence, gross
negligence, strict liability, fraud, misrepresentation, design
defect, failure to warn, nuisance, breach of express and implied
warranties, breach of special duty, conspiracy, concert of action,
violation of deceptive trade practice laws and consumer protection
statutes and claims under the federal and state anti-racketeering
statutes.
Plaintiffs in the class actions seek various forms of relief,
including compensatory and punitive damages, treble/multiple
damages and other statutory damages and penalties, creation of
medical monitoring and smoking cessation funds, disgorgement of
profits, and injunctive and equitable relief.
Defenses raised in these cases include, among others, lack of
proximate cause, individual issues predominate, assumption of the
risk, comparative fault and/or contributory negligence, statute of
limitations and federal preemption.
VECTOR GROUP: Appeal in Smith v. Philip Morris Pending
------------------------------------------------------
Plaintiffs in Smith v. Philip Morris are appealing the dismissal
of claims in the suit, according to Vector Group Ltd.'s Aug. 1,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2013.
In Smith v. Philip Morris, a Kansas state court case filed in
February 2000, plaintiffs allege that cigarette manufacturers
conspired to fix cigarette prices in violation of antitrust laws.
Plaintiffs seek to recover an unspecified amount in actual and
punitive damages. Class certification was granted in November
2001. In January 2012, the trial court heard oral argument on
defendants' motions for summary judgment and in March 2012, the
court granted the motions and dismissed plaintiffs' claims with
prejudice. In July 2012, plaintiffs noticed an appeal. The appeal
is pending.
VECTOR GROUP: "Young v. American Tobacco" Still Inactive
--------------------------------------------------------
Young v. American Tobacco Co., a purported personal injury class
action, remains dormant, according to Vector Group Ltd.'s Aug. 1,
2013, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2013.
In November 1997, in Young v. American Tobacco Co., a purported
personal injury class action was commenced on behalf of plaintiff
and all similarly situated residents in Louisiana who, though not
themselves cigarette smokers, are alleged to have been exposed to
secondhand smoke from cigarettes which were manufactured by the
defendants, and who suffered injury as a result of that exposure.
The plaintiffs seek to recover an unspecified amount of
compensatory and punitive damages. In October 2004, the trial
court stayed this case pending the outcome of an appeal in another
matter, which has been concluded. There has been no further
activity in this case.
VECTOR GROUP: Suit by West Virginia Residents Remains Stayed
------------------------------------------------------------
The case Parsons v. AC & S Inc. remains stayed as a result of the
December 2000 bankruptcy of three of the defendants in the case,
according to Vector Group Ltd.'s Aug. 1, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2013.
In February 1998, in Parsons v. AC & S Inc., a case pending in
West Virginia, a class was commenced on behalf of all West
Virginia residents who allegedly have personal injury claims
arising from exposure to cigarette smoke and asbestos fibers.
The complaint seeks to recover $1,000 in compensatory and punitive
damages individually and unspecified compensatory and punitive
damages for the class. The case is stayed as a result of the
December 2000 bankruptcy of three of the defendants.
VECTOR GROUP: Expects Adverse Effect If "Lights" Suit Increases
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An adverse ruling or commencement of additional "lights" related
class actions could have a material adverse effect on Vector Group
Ltd., according to the company's Aug. 1, 2013, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2013.
Class action suits have been filed in a number of states against
cigarette manufacturers, alleging, among other things, that use of
the terms "lights" and "ultra lights" constitutes unfair and
deceptive trade practices.
In December 2008, the United States Supreme Court, in Altria Group
v. Good, ruled that the Federal Cigarette Labeling and Advertising
Act did not preempt the state law claims asserted by the
plaintiffs and that they could proceed with their claims under the
Maine Unfair Trade Practices Act.
The Good decision has resulted in the filing of additional
"lights" class action cases in other states against other
cigarette manufacturers. Although Liggett Group LLC was not a
defendant in the Good case, and is not currently a defendant in
any other "lights" class actions, an adverse ruling or
commencement of additional "lights" related class actions could
have a material adverse effect on the Company.
In addition to the cases, numerous class actions remain certified
against other cigarette manufacturers. Adverse decisions in these
cases could have a material adverse affect on Liggett's sales
volume, operating income and cash flows.
VELTI PLC: Sued for Misleading Investors by Hiding Collection Woes
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Courthouse News Service reports that in the case Anika R.
Rieckborn v. Velti PLC; Alex Moukas; Wilson W. Cheung; Jeffrey G.
Ross, the mobile marketer misled investors by concealing its
difficulty in collecting some receivables, leading to its
announcement last week of an $111 million write-down, a class
claims.
The complaint is pending with the U.S. District Court for the
Northern District of California.
WARNER CHILCOTT: Accused of Providing False Info in Actavis Sale
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Courthouse News Service reports Warner Chilcott provided false and
misleading information about its proposed $8.5 billion stock-for-
stock sale to Actavis, shareholders claim in a federal class
action.
WELLS FARGO: Court Dismisses Overlapping Class Claims
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Jonny Bonner, writing for Courthouse News Service, reports a
federal judge dismissed overlapping class claims alleging Wells
Fargo ducked a settlement from an earlier case on "Pick-a-Payment"
mortgage loans.
Jennifer Murphy, Richard D'Alessio and Paul McDermed separately
sued Wells Fargo Home Mortgage over alleged settlement breaches
from the other case, In re: Wachovia Corp. "Pick-A-Payment"
Mortgage Marketing and Sales Practices Litigation, assigned to
U.S. District Judge Jeremy Fogel.
That multidistrict litigation represented the consolidation of
assorted "Pick-a-Payment" class actions filed in district courts
around the country, including the first-filed action filed in
northern California, Mandrigues v. World Savings, Inc., et al.
Fogel approved a written settlement agreement (MDL-SA) in the
consolidated actions in 2010.
Murphy, D'Alessio and McDermed claimed, however, that Wells Fargo
breached the settlement by applying an inaccurate definition of
"imminent default" in denying loan modification applications
(Murphy action); inflating home values, causing unwarranted loan
modification denials (D'Alessio action); and improperly denying
access to additional loan modifications (McDermed action).
In 2012, Murphy claimed Wells Fargo and others approved fewer than
3 percent of loan modifications after acquiring "troubled"
mortgage loans effectively "for nothing," adding the bank's "greed
seems to have no bounds."
Murphy and 30 other named plaintiffs filed a federal complaint
against Wells Fargo, Wachovia, World Savings Bank and Golden West
Financial, claiming they failed to honor a settlement agreement in
the class action against Wachovia in northern California.
Wells Fargo purchased Wachovia, and its "Pick-a-Payment" loan
portfolio, for $15.1 billion, on the heels of IRS Notice 2008-83,
issued Sept. 30, 2008, according to the complaint.
When defendants in the related cases moved to dismiss, U.S.
District Judge Susan Illston agreed.
"A District Court retains broad discretion to control its docket
and may exercise its discretion to dismiss a duplicative later-
filed action, to stay that action pending resolution of the
previously filed action, to enjoin the parties from proceeding
with it, or to consolidate both actions," Illston wrote.
"By filing these separate complaints, plaintiffs have invited this
court to assume the risk that its decisions may be inconsistent
with Judge Fogel's decisions on the same issues," she added. "This
court declines that invitation. Given the availability and active
pursuit of these claims in the original forum, the only
appropriate resolution here is dismissal without leave to amend of
these duplicative actions."
The lawsuits also violate a jurisdictional clause in the
settlement agreement, Illston said.
"In addition to the claim splitting prohibition, each complaint
must be dismissed because this court's consideration of any of
them would violate the parties' contract," she wrote. "Plaintiffs
and defendants in all three actions are parties to the MDL-SA.
That contract contains very specific provisions that govern
enforcement disputes. . . . By its plain language, the underlying
action remains open for the limited purpose of resolving disputes
over the parties' adherence to the contract."
Illston called it "remarkable" that the parties here would "file
entirely new putative class action complaints in order to compel
defendants' adherence to the contract, rather than, or in addition
to, litigating the same issues in the underlying action." "There
is no question that the Murphy, D'Alessio, and McDermed actions
are covered by the MDL-SA's jurisdictional clause: each action
seeks judicial review of disputes involving Wells Fargo's
adherence to the MDL-SA," the 14-page ruling states. "Thus, the
court finds that the MDL-SA prevents it from adjudicating these
matters. In addition to the improper claim splitting discussed
above, deference to the parties' contract requires that this court
dismiss these actions with prejudice."
Illston vacated a hearing scheduled for Aug. 30, and dismissed
each action without leave to amend.
A copy of the 14-page Order dated Aug. 19, 2013, is available from
Courthouse News Service at: http://is.gd/RQj4qb
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S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Christopher Patalinghug, Frauline Abangan and Peter A. Chapman,
Editors.
Copyright 2013. All rights reserved. ISSN 1525-2272.
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