/raid1/www/Hosts/bankrupt/CAR_Public/991013.MBX                 C L A S S   A C T I O N   R E P O R T E R

               Wednesday, October 13, 1999, Vol. 1, No. 176


ALEXEI YASHIN: Fed Up Canadian Fan, Season-Ticket Holder, Sues In Ont.
ALGOMA STEEL: Faces Ontario Suit Over Arsenic Pollutants From Plant
APPLIED DIGITAL: Milberg Seeks Injunction On Proposed Dynatech Merger
AUTO INSURANCE: State Farm Slammed With $600M Punitive Damages In Ill.
AVIS RENT-A-CAR: Sp Ct Oks Injunction On Racial Epithets In Workplace

CITRIC PRICE-FIXING: 4 MNCs Face Canadian Suit Seeking Class Status
COCA-COLA: Says Plaintiffs Seek Media Attention With Document Issue
CRACKER BARREL: Employee Told To Give Black Job Applicants Lower Scores
CRYSTALLEX INT'L: NY Ct dismisses Securities suit Against Can. Junior
DAINE INDUSTRIES: NY Ct Grants Motion To Dismiss Securities Suit

DIGNITY PARTNERS: May Settle Securities Suit Over After-Market Trading
FEMCARE: Loses Constitutional Challenge To Aussie Class Suit On Filshie
FEN-PHEN: Businessweek Says Cloud Over AHP Dissipates With Settlement
GREEN-MOUNTAIN.COM: Vermont Electric Utility Sued Over Advertised Rates
HI/FN INC: Barrack Rodos Files Securities Suit In California

HMO: Gilardi Announces Preliminary Ct Approval Of Humana Settlement
HMO: Judge Dismisses Civil RICO Suit Against Aetna
INTERPLASTIC MANUFACTURING: Faces Kent Suit Over Release Of Chemicals
K-TEL INT'L: Intends To Contest Consumers Suit In Ill. Over Packaging
K-TEL INT'L: Plans To Move To Dismiss Securities Suit In Minnesota

MTA: LA Judge Backs Bus Passenger Power; Orders For 250 More Buses
NCR CORP: Minnesota Fed Judge Oks Retirees' Suit For Health Benefits
PADUCAH GASEOUS: Ct Denies Class For Uranium Plant Property Damage Case
PEC ISRAEL: Shareholders Sue In NY Over Merger With IDB Subsidiary
REVLON: Issues Statement Re Finkelstein & Krinsk Class Action

SBU INC: Suit Claims Former Grocery Chain Owner Diverted Trust Fund
SGL CARBON: Settles More Graphite Electrode Antitrust Claims
TOBACCO LITIGATION: Concerns May Delay New York Tabacco Bonds

* EEOC Reviews Performance; Will Give Priority To Class Action Cases


ALEXEI YASHIN: Fed Up Canadian Fan, Season-Ticket Holder, Sues In Ont.
A disgruntled Ottawa Senators season-ticket holder has filed a
class-action lawsuit against Alexei Yashin and his agent, Mark Gandler,
seeking a combined $ 27.5 million. Len Potechin filed the statement of
claim for general and punitive damages on behalf of season-ticket
holders against Yashin and Gandler in Ontario Superior Court for
"inducing breach of contract" and "devaluation of consideration of
season-ticket contracts," among other points.

It's the first time a fan has sued a player for not fulfilling his
contract, according to Potechin and his lawyer. "What we're trying to do
is stop all this nonsense of leading sports personalities breaking their
contracts, saying 'I'm taking my puck and going home,' " said Potechin,
the founder of an Ottawa commercial realty empire. "That's nothing to
teach kids. I have five grandchildren playing organized hockey. I don't
think that's the lesson I want them to learn. You just don't walk away
from contracts of that nature."

Yashin, who has one year and $ 3.6 million US remaining on his existing
contract with the Senators, was suspended by the team when he refused to
show up for training camp. Yashin couldn't be reached for comment in
Switzerland. Gandler declined to comment.

Gandler has 40 days to respond with a statement of defence. Yashin has
60 days to respond, because he's currently living outside North America.
(The Calgary Sun 10-5-1999)

ALGOMA STEEL: Faces Ontario Suit Over Arsenic Pollutants From Plant
A $ 50-million class action suit will be filed in the Ontario Superior
Court, claiming this Northern Ontario tourist town has been poisoned
with arsenic by its once largest employer. Algoma Steel of Sault Ste.
Marie, owner and operator of an iron-ore processing plant here which
shut down in 1998, is being accused of polluting Wawa and its
surrounding township, Michipicoten, for almost half a century, the Sun
has learned.

The suit comes after township Reeve James Aquino received a letter from
the provincial Ministry of Environment in April, almost a year after
Algoma Ore Ltd., a division of Algoma Steel, closed its plant in what
was called a cost-efficiency measure. The letter told Aquino his town
was toxic and that a more detailed report would be forthcoming.

According to the detailed report by ministry experts, parts of Wawa and
its surrounding environs have arsenic levels 50 times the acceptable
health standard. At the epicentre, the plant itself, arsenic levels were
measured at 1,000 parts per million, with the acceptable health level
being 20 parts per million.

In the town proper, where two schools are located, as well as the
majority of retail business, readings ranging from 25-50 parts per
million were registered, and in soil samples as deep as 10 cm.

Wawa's class-action suit will claim that Algoma Ore's "sintering
process" -- the burning off of contaminants in raw iron ore -- has
caused an "adverse health risk" to the local population, has lowered
property values, and has tainted the region's future as a tourist
destination with the stigma of being perceived as an arsenic-ridden
no-go zone.

Wawa is on the shore of Lake Superior, 240 km north of Sault Ste. Marie.
(The Ottawa Sun 10-8-1999)

APPLIED DIGITAL: Milberg Seeks Injunction On Proposed Dynatech Merger
Between Sept. 15 and Oct. 1, 1999, various shareholders of Applied
Digital Access Inc. (Nasdaq:ADAX) represented by Milberg Weiss commenced
actions alleging breaches of the fiduciary duties owed by Applied
Digital and its insiders to Applied's public shareholders. Named as
defendants were Applied Digital, Peter P. Savage, Donald L. Strohmeyer,
Kenneth E. Olson, Christopher B. Paisley, John F. Malone, Gary D.
Cuccio, Paul L. Singer, Dynatech Corp. and Dynatech Acquisition Corp.

Plaintiffs allege that, in connection with the pending tender offer and
proposed merger between Dynatech and Applied Digital (the "Tender
Offer/Merger"), defendants failed to disclose material information and
failed to maximize shareholder value in exchange for substantial
personal benefits to be paid to Applied insiders.

On Oct. 5, 1999, defendants were served with an application for a
temporary restraining order ("TRO") to enjoin the consummation of the
Tender Offer/Merger pending a hearing on a preliminary injunction
concerning defendants' alleged unlawful conduct. Within hours of being
served with plaintiffs' TRO application, defendants agreed to not close
the Tender Offer/Merger prior to 12:00 a.m. on Nov. 1, 1999. Currently,
a hearing before the Court concerning plaintiffs' pending motion for
preliminary injunction is scheduled for Oct. 29, 1999.

If you wish to discuss this action or have any questions concerning this
notice or your rights or interests, please contact plaintiff's counsel,
William Lerach or Darren Robbins of Milberg Weiss at 800/449-4900 or via
e-mail at wsl@mwbhl.com TICKERS: NASDAQ:ADAX

AUTO INSURANCE: State Farm Slammed With $600M Punitive Damages In Ill.
In a major blow to the nation's largest insurer, an Illinois Circuit
Court judge has ruled that State Farm Mutual Automobile Insurance Co.
pay $600 million in punitive damages for defrauding millions of
policyholders by violating contract terms and using imitation parts to
repair their customers' vehicles.

In a ruling issued last Friday afternoon, Williamson County Judge John
Speroni also ordered the company to pay $130 million in compensatory
damages for statutory fraud. It came only four days after a jury ordered
State Farm to pay $456 million for breach of contract in the largest
jury verdict in a class action on record.

"This is a judgment on the deception of State Farm," said Elizabeth
Cabraser, a partner with San Francisco's Lieff, Cabraser, Heimann &
Bernstein, who helped certify the suit as a class action and who offered
the plaintiffs' 40- minute closing argument about how State Farm
violated the Illinois Consumer Fraud and Deceptive Business Practices

"The punitive and compensatory damages ought to be enough to get State
Farm's attention," she said. "And I think it's a wake-up call to other
insurance companies utilizing the same practice."

Cabraser and Lieff, Cabraser partner Morris Ratner were part of a
plaintiffs' team assembled from at least four firms around the country
to represent more than 4.5 million class members. The firm, which
specializes in mounting class actions, was integral in certifying the
suit as a class action and arguing to keep it that way when State Farm
attorneys brought an emergency writ in the Illinois Supreme Court. "I'm
sure much of my work is still to be done if they in fact choose to
appeal," Cabraser said.

In fact, State Farm attorneys are preparing to wage battle in the
state's appellate court. Corporate spokesman Phil Supple said in an
interview that the entire company was stunned. "Yes, we are going to
appeal on grounds that this constitutes outrageous punitive damages," he
said. "We reject the notion that we in any way defrauded our customers.
We feel the verdict ignores the evidence presented at the trial and
ignores the fact that we comply with the laws and insurance regulations
in every state."

The class includes vehicle casualty insurance policyholders, except in
Arkansas and Tennessee, who between July 28, 1994, and Feb. 23, 1998,
filed a claim for repairs for which State Farm did not use
factory-authorized or original equipment manufacturer, or OEM, parts. In
California, the class only applies to those who signed up for a policy
after Sept. 26, 1996.

Plaintiffs' attorneys argued that State Farm promised policyholders that
the company would repair its vehicles to their original "pre-loss
condition" after an accident.

However, the attorneys showed during the eight-week trial that the
company consistently breached its contract by not using OEM or
factory-authorized parts. Evidence presented during the trial suggested
the generic parts consistently ordered by State Farm were of lesser

Boalt Hall School of Law professor Stephen Sugarman, who specializes in
automobile insurance and litigation, noted that the judge's ruling on
punitive damages is not very large compared to the jury verdict for
compensatory damages. He noted it only amounts to roughly 150 percent of
what the jury awarded.

"That certainly is not a typical strategy for calculating punitive
damages," he said, citing recent class actions in which the punitive
damages were considerably higher.

Sugarman said it remains to be seen how the ruling will affect other
insurers. He noted that generic parts are not necessarily substandard,
although evidence apparently was presented in the State Farm case to
suggest that the company was using parts of lesser quality.

"I hope the ruling doesn't scare off companies from using equitable
generic parts, but it will be good if it scares off companies who insist
on using shoddy parts," he said. (The Recorder 10-11-1999)

AVIS RENT-A-CAR: Sp Ct Oks Injunction On Racial Epithets In Workplace
Plaintiffs, a group of Latino employees of a rental car agency, were
victims of discriminatory harassment in the form of repeated racial
epithets and other derogatory remarks.

The trial court awarded plaintiffs damages and injunctive relief barring
the offending manager from using racial or ethnic slurs in the future
and prohibiting the employer from allowing such conduct to occur. The
appellate court upheld the injunction, but instructed the trial court to
limit the language to apply only to the manager's workplace conduct and
to add a list of examples of the types of remarks prohibited by the

The Supreme Court considered whether the injunction amounted to an
unlawful "prior restraint" of free speech under both the state and
federal constitutions. In five separate opinions, the court held 4 to 3
that such an injunction was constitutionally permissible as long as the
prohibited pattern of speech (here, racial epithets) had been judicially
determined to be unlawful. In the case at hand, a jury had decided that
the manager's and the employer's conduct violated the Fair Employment
and Housing Act and that decision was not challenged on appeal. Aquilar
v. Avis Rent-A-Car Sys. Inc., 980 P.2d 846, 87 Cal. Rptr. 2d 132 (1999).
(Employment Law Strategist, September 1999)

CITRIC PRICE-FIXING: 4 MNCs Face Canadian Suit Seeking Class Status
An Ontario resident has launched a class-action lawsuit against four
multinational companies for their roles in a scheme to fix the price of
citric acid. The lawsuit names agricultural giant ADM Co., Jungbunzlauer
International AG. of Switzerland, Delaware-based Haarmann; Reimer Corp.,
and Hoffmann-LaRoche Ltd., also of Switzerland.
The companies pleaded guilty to charges laid by the Competition Bureau
last year.

The lawsuit, which has yet to be certified as a class action, asks for
general damages of $30 million and punitive damages of $30 million.
The plaintiff, Jonathan Ashworth of Waterdown, represents ''millions''
of consumers who have all overpaid for products containing citric acid,
according to the statement of claim, filed in Ontario Superior Court of
Justice in Newmarket.

Three Toronto law firms, Heifetz, Crozier, Law and Paulos Luizos, and
Igbinosun are bringing the class action.

ADM pleaded guilty to Competition Act charges in May, 1998.
Hoffman-LaRoche pleaded guilty in September, 1998, and JBL and H&R
followed suit in October. The four companies, which produced the
majority of the citric sold in Canada from 1991 to 1995, were involved
in a conspiracy to artificially raise the price of the acid.

Plaintiff represents millions of consumers who have overpaid Citric is
an organic acid used in a variety of products, including food,
beverages, cosmetics, detergents and medicines.

Hoffman-LaRoche pleaded guilty and paid a fine of $500 million (U.S.)
earlier this year to settle U.S. department of justice charges related
to its part in a decade-long conspiracy to fix the price of vitamins in
markets around the world. Charges by Canadian officials led to Roche
paying $48 million in fines on the vitamin conspiracy. The company also
faces a handful of anti-trust lawsuits here.

ADM paid $16 million in fines to Ottawa as a result of the Competition
Bureau charges in the citric acid conspiracy. Two executives have
received jail time for their role in a conspiracy to fix the $600
million world market in lysine, a soybean-based additive that promotes
growth in hogs and poultry. (The Toronto Star 10-5-1999)

COCA-COLA: Says Plaintiffs Seek Media Attention With Document Issue
The attorneys for the plaintiffs in a racial discrimination suit have
wrongly accused Coca-Cola Co. of withholding pertinent documents to
unjustifiably attract media attention, company attorneys said.
"In some cases, no such documents exist, and plaintiffs have been
informed of that repeatedly," Coca-Cola said. "In other cases, documents
have either been produced, or Coca-Cola is in the process of reviewing
those documents and will make them available as soon as possible."

The company said the plaintiffs' "true purpose is to attract media
attention, rather than reach a resolution" about this issue. Plaintiffs'
attorneys declined to comment on Coca-Cola's statements.

Last month, plaintiffs' attorneys said the company was improperly
withholding documents about its treatment of African-American employees
and its affirmative action policies. They then asked U.S. District Judge
Richard Story to order the company to immediately produce the documents.

In its challenge to the plaintiffs' motion, filed late Friday, the
company said it is "diligently reviewing hundreds of thousands of pages
of paper stored in locations across the country to comply with the
court's order and (pretrial) discovery requests" for information. The
company said it already has provided nearly 37,000 pages of documents to
plaintiffs' attorneys and has offered another million pages for their

The lawsuit, filed in April by four current and former employees,
alleges that Coca-Cola has discriminated against African-Americans in
pay, promotions and performance evaluations. The plaintiffs are seeking
class-action status to represent 1,500 other black salaried employees in
the United States.

Coca-Cola has strongly denied the allegations. (Atlanta Journal And
Constitution 10-5-1999)

CRACKER BARREL: Employee Told To Give Black Job Applicants Lower Scores
A former white employee for Cracker Barrel said Tuesday that the company
told her to give blacks lower scores when they applied for jobs. Blacks
who were hired were to be placed where they would not be "seen by our

Marilyn Hawk, who left the company earlier this year, helped store
managers screen and train new employees as part of her duties as a "new
store opener" in several states including Alabama, Georgia, North
Carolina and Louisiana.

"Not hiring black people because they're black doesn't make sense to
me," said Hawk, who made the allegations during a press conference at
the Westin Peachtree Plaza hotel. The press conference was held by the
NAACP, co-counsel in a racial discrimination lawsuit against the
restaurant chain, and lawyers representing the plaintiffs.

The company denies the charges and defended its hiring record.

The lawsuit was filed July 30 in U.S. District Court in Rome on behalf
of a dozen current and former employees, five of whom live in Georgia.
It alleges Cracker Barrel systematically discriminated against blacks in
such areas as hiring, promotions and pay. The suit also contends
managers at various restaurants referred to blacks as "boy" and used
racial slurs.

Grant Morris, one of the attorneys representing the plaintiffs said the
lawsuit was filed as a class action, though he has not formally asked
the court for that certification.

So far, he said, there are more than 250 plaintiffs and witnesses.

"At Cracker Barrel, Jim Crow Sr. may be dead, but Jim Crow Jr. is alive
and well," said Kweisi Mfume, president of the Baltimore-based civil
rights organization. He said the racially based behavior was "deeply
rooted" in the company.

Mfume said the lawsuit should serve as a signal to other businesses.
"Corporate citiznes all over the country should recognize that sort of
behavior will not, in fact, be tolerated."

Dennis Hayes, NAACP general counsel, said the case was under
investigation for three years before a lawsuit was filed in July.

Later in the day, Cracker Barrel executives held a news conference in
Nashville and called the lawsuit allegations "false and distorted."
"We take very seriously our obligation and commitment to equal
opportunity," said Norman Hill, senior vice president of human
resources. " We have representation from the dishroom to the boardroom."

Hill, who is African American, said he had been at the Lebanon, Tenn.,
company three years and it is "a good place to work."

Seven percent of the approximately 2,500 managers in stores and at the
corporate levels are black, he said. That's up from three percent in
1994. Additionally, of the company's 45,000 full- and part-time
employees, 20 percent are minorities and 12.5 percent are African

Cracker Barrel has more than 400 restaurants nationwide. It is a
subsidiary of publicly held CBRL Group, which also owns and franchises
Logan's Roadhouse restaurants.

Hill acknowledged that with so many employees "we do periodically have
instances of inappropriate behavior" He said any complaints are promptly

"Can we do better? Absolutely," he said. "Can America do better?
Absolutely. We think our feet are on the right path." (Atlanta Journal
And Constitution 10-6-1999)

CRYSTALLEX INT'L: NY Ct dismisses Securities suit Against Can. Junior
A U.S. court has dismissed a proposed class-action lawsuit against
Crystallex International Corp., the tenacious Vancouver junior that's
vowed to continue its battle with Placer Dome Inc. over a Venezuelan
gold discovery.

In an Oct. 1 ruling released, the United States District Court for the
Southern District of New York 'dismissed the purported class-action
complaint brought against Crystallex and certain of its officers and
directors,' the company said.

'We're pleased the shareholder complaints have been dismissed,' said
Marc Oppenheimer, president and chief executive. 'We've always been
comfortable with our disclosure, both in terms of timeliness as well as

The three class-action suits, filed in the summer of 1998 and bundled
into one action by the New York court, accused Crystallex of making
false and misleading statements regarding Las Cristinas, an
11.7-million-ounce gold deposit in Venezuela.

In June, 1998, the Venezuelan Supreme Court rejected Crystallex's claim
it was entitled to Las Cristinas, clearing the way for Vancouver's
Placer Dome to proceed with the development of the $575-million (US)
project in southeastern Venezuela.

Hopes of a legal victory pushed Crystallex shares to a record $11.60 in
March last year. The stock collapsed after the final and unappealable
ruling and has traded at about $1 for much of the past year. Crystallex
shares were up 16 cents to $1.32 in Toronto yesterday.

To date, Placer Dome has invested about $70-million (US) developing the
deposit. Poor gold prices forced the company to put the project on hold
in July. 'We are studying the economics to make it a more viable
project,' said Hugh Leggatt, a Placer Dome spokesman.

Despite the court ruling, Crystallex is continuing its battle. The
company is asking the court to end the partnership between Placer Dome
and its government partner Corporacion Venezolana de Guayana. In
addition, Crystallex is joining as a third party in litigation
challenging the 1991 presidential decree from which CVG derived its
authority to grant mining contracts. In August, Crystallex began an
independent investigation into the events leading up to last year's
court ruling. (National Post (formerly The Financial Post) 10-8-1999)

DAINE INDUSTRIES: NY Ct Grants Motion To Dismiss Securities Suit
Certain officers and directors of the Company had been included as
defendants in a class action entitled "Barker et. al v. Power Securities
Corp., et. al" in the Western District of New York which action alleged
violations of the securities laws in trading certain securities
including those of the Company and its former affiliated company, Davin
Enterprises Inc., by all of the defendants.  A motion was submitted to
the judge by the attorney for the class to discontinue the action
against the officers and directors of the Company, which  motion was
granted on September 13, 1999.  As a result, this case has been
terminated and all allegations against the defendants have been
dismissed.  The Company had undertaken to advance any expenses necessary
and incurred by the officers and directors in the litigation subject to
an undertaking by such officer and director to repay the advances if it
be ultimately determined that the officer or director were not entitled
to be indemnified.

DIGNITY PARTNERS: May Settle Securities Suit Over After-Market Trading
The suit alleged violations of Section 11 of the federal Securities Act
of 1933, which regulates the registration statements that must be filed
for public offerings of stock, and Rule 10(b)(5) the federal Exchange
Act of 1934, which governs trading of stock trading in the
"after-market" - the period following initial offerings.

Dignity Partners persuaded the district judge in January 1997 to dismiss
the Section 11 claims. The judge said Hertzberg and the other named
plaintiffs did not have standing to sue because they had not purchased
their shares within the required period following the initial public

In August of this year, the 9th U.S. Circuit Court of Appeals reversed
the lower court. The three-judge panel held that the district court had
mistakenly applied another provision in the Securities Act to deny
Hertzberg and the other investors their standing to sue.

Dignity Partners' attorney, Gerald W. Palmer of Jones, Day, Reavis &
Pogue in Los Angeles, said he asked the court en banc Sept. 10 to
reconsider the panel's ruling, which he called "a real departure" from
recent case law on Section 11.

Meanwhile, the parties are moving toward a settlement, according to
attorneys for both sides. "We have a handshake agreement to settle the
case in the District Court," Palmer said. Consummation of any deal would
be months away. Members of the class would have to be notified of the
agreement and given an opportunity to file objections.

Hertzberg v. Dignity Partners Inc., No. 98-16394 (9th Cir., 8/27/99).
(AIDS Policy and Law 10-1-1999)

FEMCARE: Loses Constitutional Challenge To Aussie Class Suit On Filshie
A court decision rejecting a constitutional challenge to class actions
brought by the makers of a sterilisation device was hailed as victory
for the rights of Australians.

British-based company Femcare's unsuccessful challenge was launched when
New South Wales woman Kerrie Bright tried to sue it for negligence on
behalf of other women after she became pregnant despite using the
sterilisation product, Filshie clips.

In a statement after the judgment was handed down, one of the lawyers
leading the action against Femcare, Maurice Blackburn Cashman partner
Bernard Murphy, said the decision was a victory for the rights of
Australians to take collective legal action. "As well as being a major
victory for our clients, today's decision ensures that Australians will
be able to continue to take collective legal action, which makes justice
cheaper and more accessible," he said. "Today's decision should allow
the case against the manufacturers of Filshie clips to now be heard on
its merits and also removes a possible hurdle for all other class action
cases in Australia."

Femcare claimed that the act allowing class actions in the Federal Court
breached the constitution because it bound people covered by the action
who may not know about it to the court's decision. Femcare lawyers
argued this meant people would not be able to bring individual claims or
be given the chance to opt out of the action, which went against the
rules of natural justice.

Justice John Lehane in the Federal Court declined to have the action
against Femcare dismissed and ruled that the act was not in breach of
the constitution. He said it was possible that someone who could be
covered by the class action may only think about opting out when it was
too late, after the delivery of a judgment by which they would be bound.
"But given the duration of complex litigation, the notoriety of many
representative proceedings and the existence of limitation periods, the
circumstances in which real disadvantage is likely to ensue may be
expected to be limited indeed," Justice Lehane said.

At the hearing into Femcare's attempt to have the action dismissed two
weeks ago, the Commonwealth Solicitor General intervened to argue that
the Federal Court act was valid.

Ms Bright had the Filshie clips attached to her fallopian tubes in
January last year and five months later discovered she was pregnant.
She had the pregnancy terminated and as a result suffered medical
complications, including infections.

A lawyer for Femcare, Mark Friedgut of Freehill Hollingdale and Page,
said Femcare was considering the judgment before deciding whether to
take it any further. But in the meantime the company would still seek to
have the action struck out at a hearing on October 13 on the grounds
that those bringing the action had failed to disclose a proper course of
action, he said. (AAP Newsfeed 10-6-1999)

FEN-PHEN: Businessweek Says Cloud Over AHP Dissipates With Settlement
More champagne than tears flowed among analysts and money managers who
follow American Home Products (AHP) when it announced on Oct. 7 its
proposed $4.8 billion settlement to pay off plaintiffs who claimed that
a cocktail of AHP drugs -- fenfluramine and dexfenfluramine (better
known as fen-phen) -- had caused heart problems. It isn't unusual for
such class actions to take years, if not decades, to settle. But AHP has
reached an agreement less than two years after the first reports of the
problem. Analysts are especially happy with the settlement because it is
smaller than most had feared.

GREEN-MOUNTAIN.COM: Vermont Electric Utility Sued Over Advertised Rates
A Pittsburgh area resident is seeking class action status in a consumer
protection lawsuit filed against a Vermont-based electric utility over
its advertised rates. Mark B. Aronson, of Churchill, alleges violations
of the Unfair Trade Practices and Consumer Protetion Law in a lawsuit
filed Sept. 27 against Green-mountain.com of South Burlington, Vt.

The lawsuit seeks unspecified compensatory and punitive damages for
Aronson and thousands of other electricity customers in Pennsylvania.
Attorney Charles S. Morrow filed the lawsuit on behalf of Aronson in
Allegheny County Common Pleas Court. Aronson was among thousands of
residents who participated in the state's Electric Choice Program last
year. Aronson, who was previously served by Duquesne Light Co., became a
Green-mountain.com customer in November 1998.

Ann Ryan, spokeswoman for Greenmountain.com, said the company has
100,000 electricity customers in California and Pennsylvania. She
declined to provide a breakdown for each state "for competitive

Aronson claims Greenmountain.com misled customers by advertising a rate
comparison chart that omitted state taxes from its rates. However, the
taxes were added to the rates listed for other utilities, thereby
overstating Greenmountain's savings, according to the lawsuit.
Overstating Greenmountain's savings constituted an unfair or deceptive
business practice, which violates the state's consumer protection law,
the lawsuit claims. The consumer protection law, which was enacted in
1968, allows recovery of actual damages resulting from violation of the
statute. In addition, the court can award up to three times the actual
damages plus additional relief.

Greenmountain, which markets electricity generated from the wind and
other renewable sources, recently agreed to pay the state $ 100,000 to
settle misleading advertising claims. The agreement was announced by
Attorney General Mike Fisher Sept. 24.The company acknowledged making a
mistake in interpreting Public Utility Commission regulations but did
not admit any wrongdoing. Under the agreement reached with the Attorney
General, Greenmountain agreed to clarify its rates, and advise consumers
how to switch to other suppliers. Greenmountain.com, which was
previously called Green Mountain Energy Resources, has offices in
Philadelphia. Kevin W. Hartley, the company's top marketer, left last
month to pursue other interests, according to a company spokeswoman.
(Pennsylvania Law Weekly 10-4-1999)

HI/FN INC: Barrack Rodos Files Securities Suit In California
Counsel for Class Plaintiff, Barrack, Rodos & Bacine, issued the

A class action has been commenced in the United States District Court
for the Northern District of California on behalf of all persons who
purchased the common stock of HI/FN, Inc. (Nasdaq: HIFN) between July
26, 1999 and October 7, 1999, inclusive.

The complaint charges HIFN and certain of its Officers and Directors
with violations of Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934 as well as Rule 10b-5 promulgated thereunder. The complaint
alleges that defendants issued materially false or misleading statements
regarding its business, prospects and valuation of its stock. Because of
the issuance of these false or misleading statements, the price of HIFN
common stock was artificially inflated during the Class Period.

The plaintiff is represented by the law firm of Barrack, Rodos & Bacine.
If you are a member of the Class described above, you may, no later than
November 8, 1999, move the Court to serve as lead plaintiff of the
Class, if you so choose. In order to serve as lead plaintiff, however,
you must meet certain legal requirements. If you wish to discuss this
action or have any questions concerning this case or your rights or
interests, please contact: Maxine S. Goldman, Shareholder Relations
Manager, Barrack, Rodos & Bacine, Counsel for Class Plaintiff
3300 Two Commerce Square, 2001 Market Street, Philadelphia, PA 19103
800-417-7305 or 215-963-0600 fax number 888-417-7306 or 215-963-0838
e-mail at msgoldman@barrack.com

HMO: Gilardi Announces Preliminary Ct Approval Of Humana Settlement
On August 23, 1999, Federal District Court Judge David Hagen gave
preliminary approval to the settlement of a class action lawsuit filed
against Humana Inc. and Humana Health Insurance Company of Nevada, Inc.
in Las Vegas, Nevada on March 29, 1989.

The lawsuit involves two classes. The first class consists of those
individuals who were insured by Humana Health Insurance of Nevada, Inc.
and incurred co-insurance obligations for hospital services during the
period 1984-88 obtained at Sunrise Hospital, formerly owned by Humana.
This class alleges that insureds' co-insurance obligations were
incorrectly computed based on gross (non-discounted) hospital charges
instead of net (discounted) hospital charges. Humana ceased this
practice nationwide more than eight years ago, and ceased this practice
in Nevada more than ten years ago. This class further alleges that
Sunrise Hospital monopolized the for-profit acute care hospital market
in Clark County, Nevada, leading to higher co-insurance payments by
Humana insureds. The second class consists of employers and individuals
who paid all or part of insurance premiums to Humana Health Insurance of
Nevada, Inc. from 1984-88. This class alleges that Sunrise Hospital's
alleged monopolization caused them to pay higher premium payments for
their health insurance.

In 1994, the Court ruled that the contract between Humana and its
insureds required that co-insurance payments be calculated based on net
charges. The Court later dismissed all claims by those who paid
premiums, and set for trial the remaining claims of those who incurred
co-insurance obligations. With respect to those remaining claims, Humana
denies any liability.

Given the inherent uncertainties and expense of proceeding to a trial of
the unresolved claims in the lawsuit and the likelihood of appeals
thereafter, contrasted with the certainty of achieving a current
settlement, the parties agreed to resolve the matter after protracted
arm's-length negotiations. Counsel for the class believe that the
settlement is fair, reasonable, and adequate given this uncertainty and
the previous court rulings.

Judge Hagen's preliminary approval gave the parties the green light to
provide notice of the settlement terms to the class members beginning
with direct mail notice on September 24, 1999.

The settlement agreement requires defendants to contribute $ 16.1
million for payment to the two classes. In addition, defendants have
agreed to pay plaintiffs' attorneys' fees and costs in an amount to be
decided by the Court upon application by plaintiffs' counsel. Each
member of the class of individuals who made co-insurance payments who
submits a timely claim in accordance with the requirements set out in
the settlement notice and whose claim is allowed will receive at least
7.38 times the amount by which his or her co-insurance payments exceeded
the amount that would have been paid had the co-insurance payments been
calculated using discounted hospital charges. Each member of the class
of employers and individuals who paid premiums who submits a timely
claim in accordance with the requirements set out in the settlement
notice and whose claim is allowed will receive a refund of at least 3.6%
of their total premiums paid (and, depending upon the number of claims
made on the fund, potentially more).

The settlement class is represented by the following counsel:
J. Randall Jones, Esq., Will Kemp, Esq., Jennifer Popick, Esq.,
Harrison, Kemp & Jones, Chartered, 600 Bank of America Plaza, 300 South
Fourth Street, Las Vegas, Nevada 89101; Doug Cohen, Esq., Jones Vargas,
3773 Howard Hughes Parkway, Third Floor South, Las Vegas Nevada 89109;
and William B. Markovitz, Esq., Markovitz & Greiwe, 119 East Court
Street, Suite 500, Cincinnati, Ohio 45202. These counsel can be
contacted for purposes of this settlement at 1-877-683-8331.

A copy of the settlement notice and a proof of claim form can be
obtained by sending a written request to Forsyth v. Humana Inc.,
Settlement Administrator, c/o Gilardi & Co., P.O. Box 8060, San Rafael,
CA 94912-8040, or by calling the automated toll-free number
1-877-627-6759 and specifically requesting a copy of the settlement
notice. A proof of claim form can also be obtained by contacting the
Forsyth v. Humana web site at www.gilardi.com/forsythvhumana. CONTACT:
Class Counsel 877/683-8331

HMO: Judge Dismisses Civil RICO Suit Against Aetna
A federal judge has dismissed a class-action civil RICO suit against
Aetna U.S. Healthcare, brought by a group of consumers who say it lured
them in with false promises of high-quality care while secretly
pressuring doctors to cut costs and provide only minimum care.

"A vague allegation that 'quality of care' may suffer in the future is
too hypothetical an injury to confer standing," Senior U.S. District
Judge John Fullam wrote in a tersely worded six-page memorandum and
order in Maio v. Aetna Inc.

To establish standing in federal court, Fullam said, a plaintiff must
show an "injury in fact" that is "concrete and particularized" as well
as "actual or imminent" as opposed to "conjectural or hypothetical."
The Maio plaintiffs failed that test, Fullam said, because granting them
standing "would require this court to assume that in every case,
individual physicians and IPAs *independent physician associations* will
be moved to put their own economic interests ahead of their patients'

Even if that assumption were correct, Fullam said, Aetna "would not be
the proximate cause of the providers' ethical lapses." Although that
ruling was enough to dispose of the case, Fullam said he also found that
the Maio complaint suffers from other "fatal defects." "It is highly
doubtful that advertising one's commitment to 'quality of care' can
serve as a predicate for a fraud claim," Fullam wrote. "Such general
assertions as to quality are puffery, and do not constitute a fraudulent
inducement to membership in defendants' HMO plans, particularly where
the complained-of cost containment provisions are disclosed to
prospective members."

Fullam said he also agreed with Aetna's argument that the plaintiffs had
failed to plead a proper RICO enterprise.  "An enterprise which consists
of an association-in-fact of Aetna with its various plans -- i.e. a
parent and its subsidiary corporations -- cannot be a valid RICO
enterprise where the defendants are not distinct from the enterprise."

And the plaintiffs' second theory for a RICO enterprise -- an
association-in-fact of Aetna and its subsidiaries with the doctors and
IPAs -- was equally flawed, Fullam said. "Plaintiffs have not alleged
that the providers share any common purpose with defendants, instead
citing numerous instances where the two groups are at odds."

In dicta in his final paragraph, Fullam suggested that the courts are
not the appropriate forum for the plaintiffs to wage their battle.
"Plaintiffs' expression of dissatisfaction with defendants' plans --
indeed, with HMOs in general -- is more appropriately directed to the
legislatures and regulatory bodies of the several states," Fullam wrote.

Plaintiffs' attorney Jeffrey Kodroff of Spector & Roseman in
Philadelphia said he and the other lawyers on his team will be
"studying all of our options," but would not comment further.
The suit, filed in U.S. District Court in Philadelphia, alleged that
Aetna marketed its HMO with false promises that its "primary commitment"
was to maintain and improve the quality of care. In reality, the suit
alleged, Aetna is "primarily driven by fiscal and administrative
considerations implemented through defendants' undisclosed systematic
internal policies which result in the reduction of the quality of the
healthcare services provided to plaintiffs and the class."

The suit said Aetna engaged in a false advertising campaign designed to
induce millions to enroll based on a series of claims about Aetna's
commitment to quality care and physician independence. (New Jersey Law
Journal 10-4-1999)

INTERPLASTIC MANUFACTURING: Faces Kent Suit Over Release Of Chemicals
In a case where plaintiffs claim that chemicals released from a plastic
plant caused property damage and personal injuries, an Indiana trial
court on Aug. 6 certified the proposed class action after finding that
there are questions of law common to all class members (Cindy Kay
Wilson, et al. v. Interplastic Manufacturing Co., et al., No.
97-CI-00851, Ind. Cir., Kenton Co.).

Cindy Wilson and others claim that a Kentucky plastic plant released
toxic chemicals, wastes, vapors and fumes into their residential
neighborhood. Wilson maintains that the chemical releases have caused an
ongoing trespass, decreased property values, interfered with enjoyment
of homes, personal injuries, and caused plaintiffs to fear risk of
future illness.

Claims asserted against defendant Interplastic Manufacturing Co. include
negligence, gross negligence, strict liability, private nuisance,
intentional nuisance per se, absolute nuisance, public nuisance, private
nuisance, trespass, continuing toxic trespass, negligent infliction of
emotional distress, and outrageous conduct causing severe emotional
distress. Wilson seeks compensatory and punitive damages.

                          Motion To Certify

In her motion to certify the proposed class, Wilson told the Kentucky
Circuit Court for Kenton County that certain issues are best handled on
a classwide basis, including the standard of care defendants should be
held to in handling, storing, and transporting chemicals, whether the
defendants breached that standard of care with respect to the proposed
class, whether a punitive damages award is warranted and whether
injunctive relief is appropriate.

Wilson proposed that the main class include property owners within a
2,400-foot radius of the plant, or have owned property within that
radius within five years of the filed complaint. Wilson maintained that
the subclasses should defined as absentee landlords, residents within a
certain radius of the plant who have no manifestation of personal
injuries and residents with personal injuries.

Wilson further maintained that the proposed class is so numerous that
joinder would be impracticable. She further argued that this case met
the typicality and commonality requirements.


In its August order, the trial court said that the proposed class is so
numerous that joinder of all members would be impractical. The court
further found that there are questions of law common to all class

"Although the defense is correct that not every question of law or fact
is common, the Court concludes that some questions are common and, more
importantly, that the common questions are central to this action. The
Court finds that the claims of the proposed class representatives are
typical of the claims of the entire class," the court said.

Additionally, the court found that the representative parties will
fairly protect the interests of the proposed class, and that individual
damage issues are insufficient to preclude class certification.

"Common issues which will determine liability predominate this action.
Prosecution of these actions on a class basis is overwhelmingly more
efficient than would be an individual determination of the claims," the
court said.

The plaintiffs are represented by Paul J. Dickman in Covington, Ky., and
Ron Simon of Simon & Associates in Washington, D.C. (Mealey's Litigation
Report: Emerging Toxic Torts 9-1-1999)

K-TEL INT'L: Intends To Contest Consumers Suit In Ill. Over Packaging
On March 10, 1997, Christopher Early filed a class action Complaint
against K-tel International, Inc., Dominion Entertainment, Inc., and
certain retailers in the Circuit Court of Cook County, Illinois. The
defendants removed the action to the United States district Court for
the Northern District of Illinois on April 3, 1997. On March 30, 1998,
Early obtained leave to file an Amended Complaint adding K-tel
International (USA), Inc. and one additional retailer as defendants, and
purporting to allege class actions under (1) the Illinois Consumer Fraud
and Deceptive Trade Practices Act and (2) the Racketeer Influenced and
Corrupt Organizations Act (RICO), for allegedly deceptive packaging of
certain tapes and compact discs, which packaging allegedly defrauded
consumers into believing that certain recordings thereon were original
rather than new recordings.

On behalf of the class, Early purports to seek (1) treble damages; (2)
compensatory damages; (3) punitive damages; (4) an injunction
prohibiting "the further sale of mislabeled tapes and CDs;" and (5)
attorneys' fees and costs. The RICO count in the Amended Complaint has
been dismissed. The federal district court has issued an order
purporting to remand the state law count to the Circuit Court of Cook
County, Illinois. Discovery has not commenced, and the class action
aspects of the complaint have not been ruled upon. K-tel has indemnified
the retailer defendants in this matter, and intends to contest the case

K-TEL INT'L: Plans To Move To Dismiss Securities Suit In Minnesota
K-tel and certain of its current and former officers and directors are
98-CV-2480. This action consolidates twenty three purported class
actions that were initially filed in various United States District
Courts in November, 1998, and were subsequently transferred to, and
consolidated in the United States District Court for the District of

On July 19, 1999, the plaintiffs filed an amended consolidated class
action complaint which challenges the accuracy of certain public
disclosures made by K-tel regarding its financial condition during the
period May 1998 through November 1998. The plaintiffs assert claims
under the federal securities laws and seek damages in an unspecified
amount as well as costs, including attorneys' fees and any other relief
the Court deems just and proper. K-tel plans to move to dismiss the

It is not possible at this early stage of the litigation to predict the
outcome of this action with any certainty. K-tel has two insurance
policies providing coverage of up to $20,000,000. The insurers are
providing for the defense of the claims in the class action lawsuit
subject to their reservations of legal rights under the applicable
insurance policies. Under their reservations of rights, the insurers
could contest their obligations to indemnify the Company and its
directors and officers.

MTA: LA Judge Backs Bus Passenger Power; Orders For 250 More Buses
In Los Angeles the car is king - but this week bus passengers are
celebrating a remarkable victory. In a ruling which could help the
often-neglected public transport users in other large American cities, a
federal court has ordered the local Metropolitan Transportation
Authority (MTA) to buy and staff 250 more buses.

The order came after a campaign group won a class action lawsuit,
arguing that the MTA was discriminating against ethnic minorities by not
subsidising the bus service properly.

The judge's decision represents a triumph for the Bus Riders' Union
(BRU), which was formed in 1994 to fight for better and cheaper public
transport for the 400,000 bus passengers who make up 90% of the users of
public transport in the city.

Public transport in Los Angeles is probably worse than in any other big
US city, partly because of a conspiracy in the 1930s and 40s between the
tyre, petrol and motor industries - including General Motors, Standard
Oil and Firestone - to buy up and dismantle the mass transit system by
purchasing land through a dummy corporation. The conspiring industries
were fined $ 37,000 in 1949 for anti-trust violations, but the damage
had been done.

'Most of the people on the buses are profoundly poor and people of
colour,' said Ted Robertson, one of the BRU or ganisers. 'Almost all of
the (public transport) subsidies were going to the metro and light
railway used by the suburban, mainly white middle class, while only a
very small percentage was going to the buses. The disparity was very

In effect, each train commuter was receiving a subsidy 60 times that of
a bus traveller. The buses, used by the predominantly Latino service
industry of cleaners and caterers, are notoriously irregular and a
half-hour car journey can often take four times as long by bus.

Three years ago, along with the National Association for the Advancement
of Coloured People and advice from the American Civil Liberties Union,
the BRU launched a class action against the MTA, based on the 1964 civil
rights act, which requires public money to be spent regardless of

Before the case came to court in October 1996 the MTA made a number of
concessions, which the chief US district judge, Terry Hatter, ruled this
week it had failed to implement. Consequently the judge made an
unprecedented order requiring the MTA to buy and staff the new buses. He
ruled that 'the MTA failed to meet (its) obligations'.

'It is a tremendous victory,' Mr Robertson said. It vindicates the work
of the union, which has specialised in direct action. Last year, it
organised a 'no seat, no fare' campaign to protest at a lack of buses
provided by the MTA. Protesters have also been removed in handcuffs from
meetings of the MTA directors.

A documentary film about the union, directed by Haskell Wexler, who won
Oscars for shooting Who's Afraid of Virginia Woolf and Bound for Glory,
is to be released shortly. There are now 2,000 members of the union, who
pay dues of $ 10 to $ 50 ( pounds 6- pounds 30) a year. Recruitment
takes place in churches, at community meetings and on buses. The union
also receives grants from charitable foundations.

Mr Robertson said similar passengers' organisations were being formed in
Atlanta, Chicago, Seattle, and New York, where the so-called
'strap-hangers' were battling for better service. He added that the
union was anxious to explore other avenues for change. 'We're also
looking at economic development that may come out of this, in the way of
more drivers' jobs, and plants for building the buses.'

The MTA is to discuss its next move after the ruling. The judge has
ordered it to acquire buses within 30 days or face the consequences.
(The Guardian (London) 10-5-1999)

NCR CORP: Minnesota Fed Judge Oks Retirees' Suit For Health Benefits
A federal judge in Minneapolis has certified a lawsuit over health
benefits for retirees of NCR Corporation as a class action, opening the
way for recovery by some 3,370 employees who agreed to take early
retirement in 1993.

Plaintiffs claims that the agreement included a promise by NCR to pay
specified health insurance costs to age 65 and then provide Medicare
supplemental coverage at no expense to the retiree. Last year, they say,
NCR sent notices to the participants reducing NCR's payment for pre-65
health coverage, increasing the costs to retirees and eliminating the
Medicare supplement insurance promised for age 65 and older.

The retirees are being represented by volunteer lawyers working with the
Minnesota Senior Federation's Pension Rights Project.
(Liability Week 9-20-1999)

PADUCAH GASEOUS: Ct Denies Class For Uranium Plant Property Damage Case
A 1997 property-damage lawsuit against the past operators of the Paducah
Gaseous Diffusion Plant will not proceed as a class-action case, but
lawyers will ask for many new plaintiffs to be added, one attorney said.

U.S. District Judge Joseph McKinley ruled that the plaintiffs had failed
to show their individual claims would not take precedence over any
claims common to all plaintiffs. That disparity was enough to deny class
action, he ruled.

The class would have included about 40,000 people living within 10 miles
of the 47-year-old uranium-enrichment complex about 10 miles west of

McKinley's ruling, issued Sept. 28, leaves the 67 plaintiffs in the suit
to pursue their claims against Lockheed Martin, Martin Marietta and
Union Carbide. Plaintiffs allege that past discharges of materials from
the plant have lowered their property values or damaged their property.
Some of the plaintiffs also allege they fear they will become ill from
exposure to releases.

Richard Schuster, a Columbus, Ohio, lawyer defending Lockheed Martin
said he was pleased with McKinley's ruling. It correctly noted that
because "the types of claims that were brought here are really unique to
each individual," a class could not be established, he said. Ron Simon,
a Washington lawyer who is co-counsel for the residents, said he was not
disappointed by the ruling. "I don't think it makes much difference,"
Simon said. "It favors people who will want to get involved."

No new plaintiffs have been added in the Paducah case while lawyers
awaited the class-action ruling, but attorneys will ask for many people
to be added, Simon said. The plaintiffs are evaluating millions of pages
of documents, including 18 boxes of records obtained from the Department
of Energy and Lockheed Martin, Simon said.

Lockheed Martin, a defendant in the property-damage suit, has asked for
all environmental records in the possession of three whistle-blowers.
The three allege in a separate suit that, to secure performance bonuses,
Lockheed Martin lied to the government about conditions at the plant.

The three men, Ron Fowler, Garland Bud Jenkins and Charles Deuschle,
also have joined a suit seeking $ 10 billion that was filed in U.S.
District Court in Paducah last month alleging that former plant
operators lied to workers about radiation exposure. That suit also is
seeking class-action status.

The U.S. Justice Department is still investigating the whistle-blowers'
claims to decide whether the government will join their suit. The
whistle-blower suit alleges that Lockheed Martin concealed evidence of
off-site releases of plutonium and other dangerous radioactive
materials. (The Associated Press State & Local Wire 10-7-1999)

PEC ISRAEL: Shareholders Sue In NY Over Merger With IDB Subsidiary
On December 11, 1998, two shareholders of PEC Israel Economic Corp.
instituted a purported class action in the Supreme Court of New York
State, County of New York, against PEC and its directors. In their
complaint, the plaintiff shareholders allege that the defendants
breached their fiduciary duties and engaged in self-dealing without
regard to conflicts of interest in approving on the date the complaint
was filed a proposed merger under which a wholly-owned subsidiary of IDB
Development would merge into PEC and each shareholder of PEC other than
IDB Development (which then owned 81.35% of PEC's common stock) would,
as a result of the merger, receive $30 in cash for each of his shares of
PEC common stock. The plaintiffs also assert that the $30 per share
price is unfair and inadequate and is below the fair or inherent value
of PEC's assets and PEC's future prospects.

The plaintiffs seek, among other things, to prohibit the proposed merger
and to be paid unspecified damages, attorneys' fees and other relief. To
date, no motion to enjoin the proposed merger has been made.

PEC believes that the allegations in the complaint are without merit,
and PEC intends to contest the action vigorously. To date, none of the
defendants has been required to answer, move, or otherwise respond to
the complaint and no discovery has been taken.

REVLON: Issues Statement Re Finkelstein & Krinsk Class Action
Revlon (NYSE: REV) issued the following statement on October 4 regarding
the Finkelstein & Krinsk class action suit: The suit announced today is
based on allegations which are palpably and provably false; Revlon's
financial practices and reporting are entirely consistent with Generally
Accepted Accounting Principles. The lawsuit is totally meritless and
will be vigorously defended. The Company fully expects to prevail in
this litigation.

SBU INC: Suit Claims Former Grocery Chain Owner Diverted Trust Fund
Former supermarket chain owner James R. Gibson of Belleville was accused
in a suit filed last Thursday of diverting up to $ 100 million in
government bonds to his own use. "We know there's at least $ 50 million
in those bonds missing," lawyer Thomas Ducey said in an interview. Ducey
filed the suit on behalf of a Belleville woman and as a class-action

The suit says Gibson's financial company, SBU Inc., would set up
"structured settlements" for injured people who won sizable lawsuits or
out-of-court settlements. Acting as middle man, Ducey said, SBU would
use the money to buy U.S. Treasury bonds, then set up a trust agreement
under which the injured person would receive up to 30 years of regular
monthly payments. Instead, the suit alleges, "James Gibson converted the
bonds . . . and used the same for his own benefit, to include payment of
his personal expenses, purchase of luxury boats, payments on his house
and the acquisition of properties." Money also was diverted to cover
losses Gibson incurred in operating the now-bankrupt National Food
Stores, the suit alleges.

Ducey is asking that Gibson and several co-defendants be ordered to pay
$ 100 million, plus punitive damages, costs and attorney fees. Gibson
was unavailable for comment. A receptionist at SBU said she did not know
his whereabouts. Ducey said the U.S. Justice and Treasury departments
are investigating the allegations but said that civil practices law has
allowed him to move his inquiry more quickly. U.S. Attorney W. Charles
Grace could not be reached.

Ducey's suit, filed in circuit court in Madison County, is in two parts.
The first part is filed on behalf of Martina Mertens Stone, a Belleville
woman now in her 30s, who in 1985 obtained a $ 300,000 settlement for
injuries she suffered in a crash seven years earlier. It says Gibson
diverted the funds. The second part is a class action on behalf of
others "similarly situated." Ducey said he knows of some 75 people whose
settlements or winnings also were diverted. Ducey said Stone is from St.
Clair County but the others are about evenly split between St. Clair and
Madison counties. He said filing the case in Madison County was a
"strategic decision."

He said the suit is aimed at:
    * Cutting off further loss of clients' funds;
    * Finding out how much money is left and safeguarding it;
    * Determining legal responsibility for losses "in an effort to
      obtain money to refund the trusts."

Ducey said that as far as he knows, Stone and the others are still
receiving their monthly checks. But he estimates that what money is left
could run out as early as March or April.

Named as co-defendants, besides SBU Inc., are Gibson's former partner
Charles Lehnbuetner, Oppenheimer Funds Inc., Crews and Associates Inc.,
Illinois State Trust and Magna Trust (now Union Planters Bank), the
B.D.O. Seidman accounting firm, Flag Finance Corp., Gibson's wife,
Marjori; and his daughter Jacqueline. Ducey said some of the defendants
were duped or simply "did what Gibson told them to do."

Gibson owned the Family Co., which operated National Markets and
Gibson's Markets. The company closed its last 17 stores April 12 and
filed for bankruptcy. About 1,000 people lost their jobs. Records show
the markets had lost almost $ 13 million in the 1998 fiscal year and $
10 million the year before that.

Gibson, 54, whose home is in the Signal Hill area at the west end of
Belleville, was once Ducey's client and neighbor. Gibson was arrested
more than two years ago for annoying neighbors by firing shotguns from
his back porch and scuffling with a sheriff's deputy who came to
investigate. He was found guilty of violating zoning and environmental
regulations. His conviction was upheld by an appellate court in April.
(St. Louis Post-Dispatch 10-8-1999)

SGL CARBON: Settles More Graphite Electrode Antitrust Claims
SGL CARBON Corporation, the U.S. subsidiary of SGL CARBON AG (NYSE:
SGG), has entered into settlement agreements with additional graphite
electrode customers that have asserted antitrust claims against it. In
total, SGL CARBON Corporation has now settled with more than 80% of its
customer base over the relevant period (as measured by the dollar value
of the claims). The largest claim still pending is the class action.

The settlement agreements, which must be approved by the U.S. bankruptcy
court overseeing the Chapter 11 case of SGL CARBON Corporation, release
both SGL CARBON Corporation and SGL CARBON AG of all claims.

SGL CARBON Corporation, headquartered in Charlotte, North Carolina, is
engaged in the business of manufacturing, marketing and distributing
carbon and graphite products, principally graphite electrodes and
specialty graphite products. The Company has approximately 1,200
employees located in Charlotte and Morganton, North Carolina; St. Marys,
Pennsylvania; Niagara Falls, New York; Ozark, Arkansas; Hickman,
Kentucky; Dallas and Irving, Texas and Hillsboro, Oregon. Subsidiaries
of the Company employ approximately 700 people, principally in Gardena
and Valencia, California. SGL CARBON Corporation is a wholly owned
subsidiary of SGL CARBON AG based in Wiesbaden, Germany.

TOBACCO LITIGATION: Concerns May Delay New York Tabacco Bonds
Since Mayor Rudolph W. Giuliani's January announcement that New York
City would sell bonds backed by revenues from the national tobacco
settlement, the city has been expected to be the first municipality in
the county to employ the financing method.

But city officials are concerned about lawsuits against the tobacco
industry that could jeopardize settlement payments, and their move to be
the first issuer of tobacco-linked debt may be eclipsed by Nassau
County, which has a more dire need for settlement money, according to
sources from the finance teams of both municipalities.

Regardless of which municipality sells its tobacco-settlement
securitization first, the landscape behind the deals has surely shifted
because of a new round of legal developments stemming from a federal
government lawsuit and a Florida class-action case.

First, the U.S. government recently filed a civil suit against the major
U.S. tobacco companies, making real a long-awaited federal action
against the industry a reality. Second, dominant players in the tobacco
industry must post a bond for damages in a Florida class-action case
that the companies lost, but which they are appealing.

Damages have not yet been awarded in the case, but analysts say the
companies may have to cough up more than $100 billion. And Bruce Clark,
an analyst with Moody's Investors Service, wrote in a September report
that "the industry does not have the capacity to post a bond of that

With these concerns in mind, New York City officials have said they
might want to delay their financing. In the meantime, they will try to
get a better understanding of the implications of the federal case and
the Engle class-action suit in Florida so they can better articulate the
suits' implications to investors.

While New York is remaining circumspect, Nassau County's Legislature
last week approved its transaction, moving one step closer to selling
secured bonds. The county also increased the size of its offering to
$275 million from $170 million, and rearranged how it will use the

The county will use $150 million in fiscal 1999 and $19 million in
fiscal 2000 to help close its budget deficit. Nassau will also put $105
million in an escrow account. That account will be drawn down to cover
five annual $18 million payments to the Nassau Health Care Corp., as was
mandated in NHCC's agreement to buy the county's medical center for $82
million. It also pledged to spend $250,000 annually on anti-smoking
education programs.

As part of its share of the state tobacco settlement, Nassau County will
receive $684 million over the first 25 years. Bankers working on tobacco
settlement securitization proposals said that $275 million was about the
full present value of Nassau's share.

Many market participants have expected all along that Nassau County
would wait for New York City to go first, as they expected the city,
with its unparalleled access to creative debt-marketing ideas, would put
together the most sophisticated and sound structure.

But one member of Nassau County's securitization team said the county is
not standing by waiting for New York City to move first. "The county
intends to keep to its timetable and is not going to engage in some
mutual planning exercise with another potential issuer of the bonds,"
said Herman Charbonneau, senior vice president of public finance with
Roosevelt & Cross Inc.

New York City's "issue might not look exactly the same as the county's
issue," he said. "The ratings might be different because the structure
might be slightly different. The county has the common sense attitude
that if the rating agencies are going to produce a solid
investment-grade rating on the paper."

If the county's finance team can market and sell the debt to
institutional investors, then they will go ahead with the deal,
according to Charbonneau.

But city officials also feel pressed by the agenda of Nassau County,
which may not be able to wait because it needs to use proceeds to help
close an accumulated budget deficit. City officials are aware that
Nassau's need for cash may put them in the market first, and they are
interested in seeing what type of ratings the county would get if they
went to market before the city.

New York officials are also concerned that each day the city does not
come to market increases the potential for bad news about the tobacco
industry to sully investor interest, and raise new doubts about the bond
plan. One particular worry is that Nassau, in its need to raise money
quickly, will devise a weak credit structure, which sets the tone with
the rating agencies for how to assess future tobacco securitization

"In Nassau County's case, whatever they get may be what they have to
take," said Robert H. Muller, a managing director with J.P. Morgan
Securities Inc. "And in some ways, that makes it not a great name to be
coming in for the initial tobacco financing, because they need the
market access."

One possibility that some observers are speculating about is whether
Nassau, in trying to capture the entire present value of its expected
settlement, will produce a deal that bears little resemblance to New
York City's in terms of credit quality or coverage levels. In this case,
the city would have little to fear in taking a backseat.

Charbonneau said he disagrees with the perception that because Nassau
has urgent cash-flow needs, its securitization will be less than sound.
The county, its underwriting team, Roosevelt & Cross, and other firms
working on the deal "have absolutely no interest in doing something
that's unwise," Charbonneau said. When Nassau County brings the deal to
market, "it's going to be carefully and professionally structured," with
investment-grade ratings, and it will be able to placed with
institutions, he said.

Several financial firms are taking lead roles in both deals, including
Salomon Smith Barney Inc., which is lead senior manager on both deals.

Charbonneau noted that Nassau County is issuing the bonds in a one-time
deal, rather than on a programmatic basis as New York is doing, and that
"the county has never had exactly the same rating criteria as the city."
But even if New York City successfully navigates the timing question, it
must confront other problems before the tobacco bonds can reach the

David Litvack, a managing director with Fitch IBCA Inc., said that Fitch
has determined what its rating for New York City's settlement bonds will
be based on a preliminary analysis, though he would not disclose it. He
also said that given the ratings level, New York City officials may opt
not to ask Fitch to rate the bonds. Fitch based its rating on the
long-term nature of the proposed bonds, the difficulty in predicting
future consumer behavior, and the very litigious environment in which
the tobacco companies operate, Litvack said.

Those familiar with New York City's ratings pitch have said the city had
wanted to achieve ratings in the double-A range. Moody's has determined
that its ratings for New York City's settlement securitization will be
higher than that of the corporate ratings of the tobacco companies
themselves, according to Michael Kanef, an analyst in its structured
finance group. Though Moody's too has not revealed its securitization
ratings, the tobacco companies have ratings generally in the single-A to
triple-B range.

Standard & Poor's has not made any determinations about rating levels,
said Richard Gugliada, an analyst with the agency. The city still wants
double-A ratings for the deal, though its finance officers are also
concerned with how they can best market the deal, and in that
consideration, they are looking at all their options. The city is also
currently in discussions with bond insurance companies regarding the
tobacco settlement bonds, a New York official said. The two leading
candidates to insure the transaction are triple-A insurers.

But when it comes to credit enhancement, market watchers question how
much capacity the bond insurers will reserve for tobacco
securitizations. "The question remains for the bond insurers what
exactly what this credit is," said Muller. "If it's a corporate credit,
then it's a very different story than if it's treated as a municipal."

Litvack, who also rates bond insurers, said he views the credit risk as
corporate in nature because the companies are the actual obligors in the
transaction who must make the payments under the settlement pact between
the tobacco companies and the states.

If Litvack's view prevails with the bond insurers, Muller said, then
"there's no capacity. If it's treated as a corporate credit, the
risk-weighting capital charges are huge and they would far outweigh the
ability to provide any enhancement value." (The Bond Buyer 10-4-1999)

* EEOC Reviews Performance; Will Give Priority To Class Action Cases
Flush with cash from a $37 million budget increase last year, the much-
maligned Equal Employment Opportunity Commission has been under pressure
from Congress to prove itself worthy of the raise.

Now agency chairwoman Ida Castro, one year into her tenure at the helm,
says the EEOC has delivered. At a commissioners' meeting reviewing the
agency's performance in fiscal year 1999, Castro boasted that the EEOC
is whittling down its backlog of cases, processing new complaints more
quickly, and sending more disputes to mediation than ever before.

She and fellow commissioners Reginald Jones and Paul Igasaki (the
fourth, Paul Steven Miller, was out sick) also signaled that future EEOC
priorities will include more class action litigation and cases involving
discrimination based on national origin. Another priority will be
continued improvements to efficiency at the 2,800-person agency, whose
budget was $279 million last year.

"We have had a year full of important accomplishments," Castro says. "We
hope we have converted the naysayers and proved that the EEOC can
improve on all significant indicators at once." While the agency had no
high-profile legal victories this year on a par with last year's $34
million settlement of a sexual harassment class action against the
Mitsubishi Motor Corp.'s American subsidiary or the $183 million age
discrimination settlement against Lockheed Martin predecessor Martin
Marietta, EEOC lawyers still netted more than $268 million through
enforcement and litigation.

Litigation highlights include a pregnancy discrimination class action
against Pacific Bell Telephone and Nevada Bell Telephone, which settled
for $25 million; an $8 million settlement in a sexual and racial
harassment class action against the Ford Motor Co.; and a $28 million
age discrimination class settlement from insurance brokerage Johnson and
Higgins, now part of Marsh & McLennan Cos. 'THE GROUNDWORK PAID OFF'

But the commissioners seemed most proud of two cases that didn't
generate big payouts. One was a wage discrimination suit involving 65
Filipino nurses at a Missouri nursing home, which settled for $2.1
million. The other, a suit brought on behalf of 18 Vietnamese American
at-sea workers for a Seattle-based seafood company, was resolved for
$1.25 million.

These cases represent the early fruits of a five-year effort to step up
national-origin discrimination litigation, historically an area of EEOC
weakness, says Commissioner Igasaki.

"This year, the groundwork paid off," he says, crediting agency outreach
programs "where we go out and talk to communities in their language."

Igasaki notes that the percentage of discrimination suits filed by
Latino and Asian workers has been significantly lower than their numbers
in the work force, and theorizes that this is because "they don't
understand their rights and our ability to help them." Since 1996, the
EEOC has made litigation involving multiple parties or systematic
discrimination a priority. Through the third quarter of fiscal year
1999, General Counsel Gregory Stewart reported, such cases made up 30
percent of suits filed.

To defense-side employment lawyer Barbara Brown, a partner at the D.C.
office of Los Angeles' Paul, Hastings, Janofsky & Walker, this emphasis
makes perfect sense. Indeed, she says, because the agency has much
broader authority to bring class actions than private plaintiffs
lawyers, the EEOC is at its strongest here.

"When an employer is up against the EEOC in a class action situation, it
is of grave concern," she says. Brown, co-chair of the American Bar
Association's Equal Employment Opportunity Committee, says that within
the defense bar, the agency's reputation for litigation prowess varies
by region, but adds, "Its reputation for a charging agency has improved
dramatically." EFFICIENCY IS UP

Indeed, at least week's meeting, the commissioners focused on
accomplishments in this area. Castro reported that the agency's average
processing time for resolving charges of discrimination is down to 268
days -- 46 days fewer than last year. And while the agency's backlog of
cases remains substantial, with 45,624 charges currently awaiting
review, it is down 6,500 from last year and a whopping 66,000 less than
its high of 111,000 in 1995.

For helping reduce the load, Castro credits a system for prioritizing
charges that was instituted by her predecessor, Gilbert Casellas, now
president and chief executive officer of the West Chester, Pa.-based
Swarthmore Group, an investment and financial advisory firm.

However, this productivity has not translated into more lawsuits being
filed. EEOC lawyers are on track to file 360 to 370 lawsuits this year
-- about the same as in 1998, reported General Counsel Stewart.

The reason, he explains, is the Supreme Court's trio of decisions this
summer narrowing the Americans with Disabilities Act. "The court adopted
a different approach than the commission had been using regarding ADA
claims," he says. "We spent a great deal of time in July and August
reviewing our ADA cases."

One of the EEOC's other major initiatives this year has been rolling out
its nonbinding mediation program. The agency had experimented with pilot
programs for several years, but this is its first nationwide plan. EEOC
staff and contract mediators have resolved 4,000 charges since the
program became fully operational in April, a 65 percent settlement rate.

Still, Castro expressed frustration that respondents agree to mediate
only 36 percent of the time. Ted Meyer, a Houston partner with Chicago's
Seyfarth, Shaw, Fairweather & Geraldson who participated in a panel
discussion at the commission's meeting, offered a few explanations.
"Some view the act of asking for mediation as a sign of weakness," he
says. " And with some cases, you won't get employer buy-in due to the
nature of the case." This year, the EEOC also launched a small-business
initiative providing outreach education and technical assistance to

"We have met all our goals and made significant inroads to ensure the
EEOC moves closer to the goal of eliminating discrimination in the
workplace," says Castro. And in a not-very-subtle pitch to preserve
agency funding, she adds, "We hope we receive the necessary support to
continue our good work." (The Recorder 10-6-1999)


S U B S C R I P T I O N  I N F O R M A T I O N

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Copyright 1999.  All rights reserved.  ISSN 1525-2272.

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