/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/000217.MBX C L A S S A C T I O N R E P O R T E R Thursday, February 17, 2000, Vol. 2, No. 34 Headlines AMERIBANK: MI Ct Dismisses Successor Suit on Fees; Tolling Can't Apply BESICORP: Announces Dismissal of NY Suit Re Consideration from Merger BLOOD VICTIMS: Canadian Fund Gets Tied up; Adjudicator Faces U.S. Suits FEN-PHEN: AHP Agrees to Pay Houston User with Replacement Valves $8-9M INMATES LITIGATION: Ex-Attica Inmates Recount Suffering at Hearing JDN REALTY: Chitwood & Harley Files Securities Suit in Georgia JDN REALTY: Schiffrin & Barroway Files Securities Lawsuit in Georgia JDN REALTY: Shepherd & Geller Files Securities Suit in GA JDN REALTY: Steven E. Cauley Files Securities Lawsuit in Georgia LOS ANGELES POLICE: ACLU Alleges Racial Profiling In Federal Lawsuit NJ POLICE: Barisonek to Manage Discovery in Racial-Profiling Challenges POLICY MANAGEMENT: Wolf Haldenstein Files Securities Suit in NY SUNSTAR HEALTHCARE: Burt & Pucillo Files Securities Lawsuit in FL SYKES ENTERPRISES: Gilman and Pastor Files Securities Suit in FL * Blacks in Govt Urge Clinton to Protect Diversity Programs in Hiring * FTC Plans to Beef up Action against Fraud in Online Auctions * Washington Post Says Class Act Ban in Bill Debilitating for VA's Poor ********* AMERIBANK: MI Ct Dismisses Successor Suit on Fees; Tolling Can't Apply ---------------------------------------------------------------------- The pendency of a class action tolls the statute of limitations period for filing individual claims but not for successor class actions. Weston v. AmeriBank, No. 1:99-cv-698 (W.D. Mich. 1/3/00). A class of loan borrowers sued AmeriBank in Michigan's Kent County Circuit Court on Dec. 21, 1998, alleging the bank violated Michigan law by engaging in the unauthorized practice of law and charging excessive document preparation fees. The court certified Dressel v. AmeriBank, No. 98-13017-CP (Kent County Circuit Court 1998), as a class action but before class notice was sent dismissed the action. The court held the bank's "practice of preparing documents and charging a fee for that preparation [did] not constitute the unauthorized practice of law... . This Court also conclude[d] that, likewise as a matter of law, the fee charged by the bank [was] not illegal, even if it exceed[ed] the costs of preparing the loan documents." The court denied the plaintiffs' request to amend their complaint to include a TILA count and dismissed the class action on July 2, 1999. The court also denied the plaintiffs' motion for reconsideration on Sept. 3, 1999. Seven days after the circuit court denied the motion for reconsideration in Dressel and one year and five months after closing her loan with AmeriBank, Patricia A. Weston filed a class action against the lender in the U.S. District Court for the Western District of Michigan. Weston, who was a member of the Dressel class and represented by the same class counsel, claimed the bank violated the TILA when it charged her a 350 fee disclosed as a document preparation fee when in fact it was a loan processing or loan origination fee. She contended the fee was not disclosed on her TILA statement as an element of the finance charge and was not included in the annual percentage rate. Class Claims AmeriBank rebutted that the TILA's one-year statute of limitations barred Weston's action. Weston countered that the statute was tolled on her TILA claim during the pendency of the Dressel case action and, thus, her complaint was timely filed. She relied on the U.S. Supreme Court's ruling in American Pipe and Construction Co. v. Utah, 414 U.S. 538 (1974), that if a statute of limitations is tolled it is tolled for all class members until class certification and then individual class members may file their own individual suits or intervene as plaintiffs in the pending class action. The District Court held that Weston misapplied American Pipe to her situation because "Weston [was] not however, in this case, merely attempting to bring her own individual claims against AmeriBank. Instead, Weston, like her predecessors in Dressel, [sought] classwide relief." Following the majority view, the District Court ruled that while the statute of limitations for individuals claims was tolled during the pendency of a class action, there was no similar tolling period for future class actions for putative class members. Individual Claims Next, the District Court considered if Weston's TILA action could proceed as an individual claim. It concluded that under the state law and the doctrine of res judicata, Weston could not litigate a claim that could have been litigated in the earlier proceeding. Judge Wendell A. Miles stated that all the elements of claim preclusion were present: * The parties or their privies were the same. * The prior judgment was rendered by a court of competent jurisdiction. * The prior judgment was final and rendered on the merits. * The two suits involved the same cause of action or causes of action that could have been litigated. Forum Shopping The District Court also addressed AmeriBank's allegations that Weston engaged in forum shopping. According to the court, the fact that Weston filed her action seven days after the circuit court denied the Dressels' motion for reconsideration, that she failed to file an appeal in Dressel and that she failed to file her own state court action, supported AmeriBank's allegations. Equitable Estoppel Weston, in a last attempt to avoid dismissal, argued that the statute of limitation on her TILA claim should be equitably tolled because AmeriBank engaged in fraudulent concealment. She claimed the bank misled her in regard to the document preparation fee disclosed on her settlement statement. The court ruled AmeriBank's actions did not amount to fraudulent concealment and thus, equitable tolling was not warranted. "Nothing which AmeriBank has done, or failed to do, prevented Weston from filing suit in a timely matter. AmeriBank did not hide the fact of the charge, nor did it conceal to whom the fee would be paid." In conclusion, the District Court granted AmeriBank's motion to dismiss and dismissed Weston's claim with prejudice. John E. Anding of Drew, Cooper & Anding in Grand Rapids, Mich., represented Weston. Ronald J. VanderVeen of Cunningham Dalman PC in Holland, Mich., represented AmeriBank. (Consumer Financial Services Law Report, February 9, 2000) BESICORP: Announces Dismissal of NY Suit Re Consideration from Merger --------------------------------------------------------------------- Besicorp Ltd. announced on February 14 that the New York Supreme Court, New York County, dismissed, with prejudice, a class action lawsuit against Besicorp Group Inc., the Company's former parent. The lawsuit, Alan Fenster vs. Besicorp Group Inc. et al. was filed in January of 1999, and alleged, among other things, that consideration Besicorp shareholders were to receive from a merger which became effective on March 22, 1999 was inadequate. Michael Zinn, President of Besicorp Ltd., made the following statement: "Yet another meritless and malicious class action suit has been dismissed. These plaintiff attorneys make a fortune extracting money from the companies they target because most companies pay them off rather than endure protracted litigation. Besicorp has never paid off legal predators. These lawsuits cause enormous damage to the companies and individuals that they target, and there is no means to hold these people accountable." Michael Zinn, founder and CEO of Besicorp, is the author of "Mad-Dog Prosecutors and Other Hazards of American Business," a book which describes his encounters with America's legal system. BLOOD VICTIMS: Canadian Fund Gets Tied up; Adjudicator Faces U.S. Suits ----------------------------------------------------------------------- Thousands of Canadians - estimates vary from 20,000 to 50,000 - were infected with hepatitis C through the blood system in the 1970s and '80s. Some died of the chronic liver disease, reports The Toronto Star. Four years ago, some of the victims banded together to launch a class action suit. Ottawa and the provinces, fearing massive damages, decided to settle out-of-court. On March 27, 1998, the two levels of government announced a $1.2 billion fund for those infected between 1986 and 1990. The national compensation plan would provide money, on a sliding scale, for up to 10,000 Canadians infected with hepatitis C between January, 1986, and July, 1990. The victims still haven't seen a penny. While victims wait for payments, some 40 hemophiliacs have died. Other tainted-blood victims have been paying for drugs and other treatments for almost two years while the compensation fund has been bogged down in court hearings. Health Minister Allan Rock says he has instructed government lawyers to do all they can to speed delivery of some $1.2 billion in tainted-blood compensation to victims who have waited almost two years for their money. Controversy over Lawyers' Payment Lawyers for tainted-blood victims have already been paid more than $4 million from a compensation fund, The Toronto Star points out. The lawyers, who are seeking $52.5 million in total fees, say they have merely dipped into a fund to pay off creditors after working for four years without payment. But some victims are livid. ''It's pretty disgusting,'' said Neil Van Dusen, a 41-year-old Nova Scotia hemophiliac and father of four. ''They're paying the lawyers before the victims. These guys can't wait? It's pretty hard to take. I haven't seen one thin dime.'' Van Dusen is infected with hepatitis C and faces a liver transplant. He is eligible for payments up to $240,000 from a $1.2 billion compensation package for hepatitis C victims, which was agreed to by federal Health Minister Allan Rock and his provincial counterparts almost two years ago. A Toronto court begins on February 14 consideration of the fees for lead counsel Harvey Strosberg and his colleagues, who negotiated for all blood-transfused tainted-blood victims in Ontario and the rest of Canada except Quebec and British Columbia. Court documents show that in Ontario, Strosberg and his associates have already been paid $3.2 million for work on behalf of tainted-blood victims between 1986 and 1990. Strosberg said 11 law firms have been working without pay for more than three years on the tainted-blood case and he called the payment approved by the court ''perfectly reasonable.'' ''The lawyers have not been paid,'' he said.''We have received some money on account which covers our costs.'' The lawyer representing British Columbia victims, J.J. Camp, acknowledged he has received a cheque for $950,000 for his work so far. He said he needed the money to pay for disbursements and pay down a line of credit ''which went through the roof . . . I'm just back even,'' he said. Two lawyers who have been negotiating the package along with Camp and Strosberg have decided they will not take any money before the compensation fund is paying victims. ''We do not believe lawyers should be paid any fees while victims wait,'' said Pierre Lavigne, the lead counsel for Quebec hepatitis C victims. Bonnie Tough, who represented hemophiliacs in the deal, has been allowed expense money of $913,171 by the court but she has not accepted the payment. ''My arrangement with my clients is that I'm not going to get paid before there is an administrator in place paying victims,'' she said. Isaac Magiskan of Thunder Bay, who has hepatitis C, said news that lawyers have already dipped into the compensation fund has saddened him. Rock told the Commons his lawyers are hard at work to ensure that money goes to claimants ''at the earliest possible moment.'' He was responding to NDP health critic Judy Wasylycia-Leis, who told the Commons the lack of payment to tainted-blood victims after 23 months represents ''another Liberal scandal.'' In Toronto, Strosberg argued that the Ontario lawyers helped sweeten the compensation deal, Canadian Press reports. ''As a result of their efforts there was $520 million added to the settlement, '' he told Justice Warren Winkler of Ontario's Superior Court of Justice. Strosberg said the lawyers also won other important concessions, such as a guarantee that claimants won't have to give up their right to government benefits. 'They've all got nice homes and nice cars' Taking on the case was risky, he added: ''A more complex case than this is hard to imagine.'' Rock also told the House of Commons that Ottawa has consistently opposed payouts to lawyers for hepatitis C victims before money is paid out to those victims. As he was speaking, his lawyers were in a Toronto courtroom seeking to reduce potential payouts to Ontario lawyers involved in the case to $3.9 million from $20 million. In British Columbia, federal lawyers are seeking to reduce a $15 million proposed legal fee to between $3.25 and $3.75 million. The lead counsel in the B.C. lawsuit, J.J. Camp, has already received $950,000 in payments. Ottawa has not yet filed its arguments in Quebec, where lawyers representing victims in that province have requested $17.5 million. Adjudicator Is Facing a Slew of Class Action Suits in U.S. According to The Toronto Star, more delays loom because the parent company of the administrator of the fund - the adjudicator who decides who is eligible for compensation - is facing a slew of class-action lawsuits in the United States. After Peterson was approved in Ontario and British Columbia courts, its parent company was hit with a number of class-action suits in the U.S. and actions filed with the U.S. Securities and Exchange Commission. Lawyers involved in the national compensation plan have also moved to allay fears that the victims will face further delays because of the uncertainty surrounding the fund's administrator. A court in Quebec will hear testimony on the state of the company, Peterson Worldwide. A Montreal court will hear arguments February 17 and 18 regarding the reliability of Peterson Worldwide, the company that had been agreed on as the fund administrator. Camp will argue Peterson should continue as administrator and should post a performance bond. He said Peterson has been working to set up the infrastructure for the administration even though its fate is unclear. If rejected by the court, the job will go to Kitchener-based Garden City Group Canada. (The Toronto Star February 14 and 15, 2000) FEN-PHEN: AHP Agrees to Pay Houston User with Replacement Valves $8-9M ---------------------------------------------------------------------- American Home Products Corp. has agreed to pay $8 million to $9 million to a Houston woman in what could be the largest settlement to date for any individual claiming harm by the fen-phen diet drug combination, the Houston Chronicle reported in its Saturday editions. Virginia Brinkley, 55, had to have two heart valves replaced with artificial valves and was facing a third replacement, allegedly because of side effects from the drugs. Her case was to go to trial. John O'Quinn, her attorney, said Brinkley began taking fen-phen in 1995 to lose weight and treat an acid-reflux problem. Her heart-valve problems were diagnosed a year later. In October, Madison, N.J.-based American Home Products announced it would pay $4.8 billion to settle fen-phen lawsuits. However, attorneys representing thousands of fen-phen users said they wouldn't participate in the settlement. INMATES LITIGATION: Ex-Attica Inmates Recount Suffering at Hearing ------------------------------------------------------------------ Gary Haynes, Attica survivor, waited almost 30 years for this day. Dressed in a weathered suit with his mother, Betty, at his side, Mr. Haynes showed up at the federal district courthouse here almost an hour early on February 15 morning. He wanted to talk about how the guards had beaten him and burned his chest with cigarettes. He wanted to tell people about the kidney transplant that he says was a result of the beating -- as well as the broken ankle, the broken feet, the broken hip and the thwarted dreams that ensued. He got his chance shortly after 10:30, when he rose from the gallery, walked to the lectern and addressed Judge Michael A. Telesca, his voice quivering. "There is no way in the world that what each of us went through can have a monetary value," said Mr. Haynes, who served three years for check forgery and is now a frail and scruffy 53. "Is it worth $1? Is it worth $10 million? It's been 28 years and it's time to end. It's time to end." With that, Mr. Haynes became the first of 14 former inmates to offer their opinions at a unusual hearing about last month's prisoners' rights settlement, in which New York State agreed to pay a total of $8 million to inmates who were tortured by guards and state troopers after the 1971 Attica prison uprising. Forty-three people were killed and more than 80 wounded in the four-day siege and its suppression, the bloodiest prison uprising in the country's history. With one exception, the former inmates said that the settlement, while not as generous as they would have liked, was an acceptable way to close a painful chapter in their lives. As a result, Judge Telesca is expected to approve the agreement, and begin the formidable job of dividing the money among the inmates, based on the injury each suffered in the violence. For most of the former inmates who came out in the day's snow and ice to speak up or just lend support to those who did, the hearing was the first time they were back in a courtroom since being sentenced to prison, 30 years ago or more. And it proved to be a visceral reminder of how much has changed: one man carried an oxygen tank, another walked with a cane, and everyone, it seemed, had moistened eyes. The sister of one former inmate, Ernestine Felder Keeton, began to sob, uncontrollably, while talking about her younger brother, Gregory, who had been serving time in Attica for robbery. He died of cancer six years ago at age 41. "I never heard a whole bunch of people speak at one time," she said. "I thought Gregory was making some of this up. My brother would run through the house screaming or hiding under the bed, thinking that someone would be after him. My kids thought we lived in the prison." The hearing was all the more unusual as an unexpected reunion, since many of the former inmates had not seen each other since the siege three decades ago. On Sept. 9, 1971, inmates at the Attica Correctional Facility, about 30 miles east of Buffalo, seized control of parts of the prison and took many of the guards hostage as a way of protesting poor medical care, unsanitary conditions and the lack of other basic services. When negotiations stalled, though, Gov. Nelson A. Rockefeller ordered the state police to retake Prison Yard D. Troopers used helicopters, dropped tear gas and fired indiscriminately at a crowd of more than 1,200 inmates in the yard. After the troopers had regained control, law enforcement authorities and prison guards committed brutal acts of reprisal, forcing inmates to crawl naked over broken glass and denying basic medical care to the injured. Three years later, lawyers representing 1,281 inmates filed a $2.8 billion class-action lawsuit against prison and state officials. But it took 18 years before the suit came to trial, and 5 more to reach the damages phase -- delays that the inmates' lawyers and a federal judge later said were the fault of a lower court judge and the State of New York. In January, though, at the urging of Judge Telesca, the parties agreed to the proposed settlement, which provides $8 million for inmates and $4 million in lawyers' fees and does not require the defendants to admit liability or wrongdoing. In an indication of just how sensitive the Attica case remains, Judge Telesca felt compelled to clarify several matters. He said that although he sympathized with calls from a growing number of people to offer additional benefits to the relatives of the 11 guards who were killed, he emphasized that the settlement, by law, could deal only with the inmates' lawsuit. Judge Telesca also said that only those inmates who were injured during the siege would be eligible for the settlement. They will have until July 7 to fill out a questionnaire, then will be interviewed individually, if need be, by the judge, to determine how much money each should receive. The inmates' lawyers, some of whom have worked on the case for all their careers, expect that perhaps 500 former and current inmates, most of whom are middle-aged or elderly now, will file claims, and that the $8 million should be divided up by year's end. But for the next few days, at least, the courtroom talk about the case will focus on the personal tales of woe and resurrection from the former inmates and their relatives. There were people like Joseph McKee, who walked with a cane and talked about how he just wanted to "get it over with." And Alice Lake, the widow of Jake Lake, who spent 18 months in Attica on drug charges, she said. She talked about the emotional toll the experience and the nightmares it engendered had exacted on families. "It took me longer to get over it than my husband," she said, clutching a sheaf of legal documents. "This is a bitter taste, and you have to spit it out." Others dwelled more on the historical and emotional ramifications. The last speaker, Frank Smith, who had been convicted of holding up a dice game, talked of how it was important to remember why the uprising happened: to call attention to atrocious prison conditions. "When you explain to your kids and your grandkids what the whole essence of Attica was," Mr. Smith said in a booming voice, to both the gallery and the judge, "you'll be able to tell them that it was to be treated as human beings." (The New York Times, February 15, 2000) JDN REALTY: Chitwood & Harley Files Securities Suit in Georgia -------------------------------------------------------------- The Law Firm of Chitwood & Harley filed a securities class action lawsuit in the United States District Court for the Northern District of Georgia on behalf of all purchasers of securities of JDN Realty Corporation during the period March 31, 1997 through February 14, 2000, inclusive. The complaint charges JDN and one of its officers with violations of the Securities Exchange Act of 1934. During the period 1994-1998, JDN filed false and misleading financial statements with the Securities Exchange Commission, the complaint alleges. On February 14, 2000, the Company revealed that it would restate its financial results, thereby admitting that its financial statements between 1994 and 1998 were false, the complaint alleges. According to the complaint, these revelations caused the price of JDN securities to collapse in value. Its common stock fell from $16 9/16 to $9 13/16, a one-day drop over 40%. The complaint alleges that prior to the collapse JDN sold $150 million worth of JDN securities at artificially inflated prices. Contact: Corey D. Holzer (888) 873-3999 (toll-free) or by e-mail at cdh@classlaw.com Chitwood & Harley, 2900 Promenade II, 1230 Peachtree Street, N.E., Atlanta, Georgia 30309. For more information about Chitwood & Harley, you can visit website at http://www.classlaw.com JDN REALTY: Schiffrin & Barroway Files Securities Lawsuit in Georgia -------------------------------------------------------------- The law firm of Schiffrin & Barroway, LLP commenced securities Class action lawsuit in the United States District Court for the Northern District of Georgia on behalf of all individual and institutional investors who purchased securities of JDN Realty Corporation from March 31, 1997 through February 14, 2000, inclusive. The complaint charges JDN Realty and certain of its officers and directors with concealing the fact that certain of the Company's executives were receiving undisclosed compensation in connection with many of its real estate development projects. As a result, the Company's financial statements were misstated and the market price of JDN Realty's stock was artificially inflated. When defendants disclosed this information, JDN Realty's stock price dropped over 40% in the course of a single trading day. For more details regarding this lawsuit, please contact Stuart L. Berman, Esq. of Schiffrin & Barroway, LLP. toll free at 1-888-299- 7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com or visit website at http://www.sbclasslaw.com JDN REALTY: Milberg Weiss Files Securities Suit in Georgia ---------------------------------------------------------- Milberg Weiss Bershad Hynes & Lerach filed a class action lawsuit in the United States District Court for the Northern District of Georgia on behalf of all persons who purchased the common stock of JDN Realty Corporation between March 28, 1997, and February 14, 2000, inclusive. The complaint charges JDN and one of its officers with violations of the Securities Exchange Act of 1934. During the period 1994-1998, JDN filed false and misleading financial statements with the Securities Exchange Commission, the complaint alleges. On February 14, 2000, the Company revealed that it would restate its financial results, thereby admitting that its financial statements between 1994 and 1998 were false, the complaint alleges. According to the complaint, these revelations caused the price of JDN securities to collapse in value. Its common stock fell from $16 9/16 to $9 13/16, a one day drop over 40%. The complaint alleges that prior to the collapse JDN sold $150 million worth of JDN securities at artificially inflated prices. For additional information concerning this lawsuit, please contact, at Milberg Weiss Bershad Hynes & Lerach, Steven G. Schulman or Samuel H. Rudman at One Pennsylvania Plaza, 49th Floor, New York, New York 10119-0165, by telephone 1-800-320-5081 or via e-mail at endfraud@mwbhlny.com or visit website at http://www.milberg.com JDN REALTY: Shepherd & Geller Files Securities Suit in GA --------------------------------------------------------- The Law Firm of Shepherd & Geller, LLC announced that it has filed a class action in the United States District Court for the Northern District of Georgia on behalf of all individuals and institutional investors that purchased the securities of JDN Realty Corporation between March 31, 1997 and February 14, 2000, inclusive. Securities covered by the lawsuit include common stock, bonds and 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock. The complaint charges that the Company and one of its officers violated the federal securities laws. During the period of 1994 - 1998, JDN's financial statements were all materially overstated and false. As a result of these false and misleading statements the Company's stock traded at artificially inflated prices during the class period. On February 14, 2000, the Company revealed that it would be restating its financial results, thereby admitting that its financial statements between 1994 and 1998 were false. Prior to the disclosure of the above-mentioned adverse facts, the Company took advantage of the inflated stock price by selling $150 million worth of JDN securities to the investing public. When the truth about the Company was revealed, the price of the stock dropped significantly. Contact: Shepherd & Geller, LLC, Boca Raton, Jonathan M. Stein, 561/750-3000, Toll Free: 1-888-262-3131, E-mail: jstein@classactioncounsel.com JDN REALTY: Steven E. Cauley Files Securities Lawsuit in Georgia ---------------------------------------------------------------- The Law Offices of Steven E. Cauley, P.A. filed a class action lawsuit in the United States District Court for the Northern District of Georgia, Atlanta Division, on behalf of all purchasers of securities of JDN Realty Corporation during the period March 31, 1997 through February 14, 2000 inclusive. Securities covered by the lawsuit include common stock, bonds and 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock. The complaint charges JDN and one of its officers with violations of the Securities Exchange Act of 1934. During the period of 1994-1998, JDN's financial statements were all materially overstated and false. On February 14, 2000, the Company revealed that it would restate its financial results, thereby admitting that its financial statements between 1994 and 1998 were false. This revelation, according to the complaint, caused the price of JDN Realty's securities to collapse in value, falling from $16 9/16 to $9 13/16, a one day drop of over 40%, to close well below the prices at which JDN securities traded throughout the Class Period. The complaint alleges that, prior to the collapse, JDN sold $150 million worth of JDN Realty securities at artificially inflated prices. Contact: Law Offices Of Steven E. Cauley, P.A. 2200 N. Rodney Parham Road Suite 218, Cypress Plaza Little Rock, AR 72212, e-mail at CauleyPA@aol.com or call at 1-888-551-9944 (toll free). LOS ANGELES POLICE: ACLU Alleges Racial Profiling In Federal Lawsuit -------------------------------------------------------------------- The American Civil Liberties Union is suing the Los Angeles Police Department for alleged racial profiling, where officers stop motorists based on ethnicity or appearance. The lawsuit was filed on February 10 in U.S. District Court on behalf of three black men and two Hispanic men who were pulled over by LAPD officers within the past year. ``The stated grounds for the stops were trumped up and phony,'' said Ramona Ripston, executive director of the ACLU's Southern California chapter. ``There is no way in the world what happened to them would have occurred if they were white.'' The stops cited in the suit included several of men who were forced from their cars at gunpoint, handcuffed, detained and accused of criminal conduct without provocation, the ACLU said. Ripston said the suit sought to end ``the terror persons of color feel when stopped and scrutinized.'' Among other things, it asks the department be required to maintain comprehensive traffic-stop records. Last year, Gov. Gray Davis vetoed legislation that would have required California law enforcement agencies to collect race and ethnicity data on traffic stops. Dozens of local agencies are doing that voluntarily at Davis' request. The California Highway Patrol is conducting its own study of the issue, collecting data on traffic stops for the next three years. Meanwhile, several state legislators have revived a bill that would order police agencies to track the race of drivers stopped for traffic violations. Davis' program to study racial profiling doesn't go far enough, said state Sen. Kevin Murray, a fellow Democrat and lead author of the latest bill. He said only 50 of 433 law enforcement agencies have agreed to collect the data. Police agencies from New Jersey to Chicago have grappled with racial profiling accusations. Some other California cities - including San Diego and San Jose - have initiated programs to eliminate the practice. (Los Angeles (AP)) NJ POLICE: Barisonek to Manage Discovery in Racial-Profiling Challenges ----------------------------------------------------------------------- By invoking its administrative powers under the state constitution, New Jersey's Supreme Court consolidated in a single judge discovery motions in cases in which criminal defendants claim to have been victims of racial profiling by the State Police. But lawyers defending 80 indicted drug offenders in 10 counties are not upset, because the Court turned the attorney general down on the most critical part of his request. While discovery motions not yet filed in profiling cases will be managed by one judge, pending motions will remain under the aegis of the judges already handling them. Those motions will be stayed until resolution of appeals of discovery orders in three cases now at the Appellate Division. (See Notice to the Bar, page 2.) That means the attorney general will not get the opportunity to re-litigate the discovery orders already entered, which gave defendants wide access to State Police records. Those orders will stand unless overturned on appeal. Appointed as the statewide discovery manager is Union County Superior Court Judge Walter Barisonek, a 16-year veteran of the bench, primarily in the Criminal Part. Barisonek has a reputation for being a tough sentencer but one who is relatively free of ethnic and racial bias. Barisonek, a former municipal prosecutor and a former staff attorney for Essex County Legal Services, consistently has received high marks by practitioners for his overall competence. But the justices denied Attorney General John Farmer Jr.'s plea to have the selected judge rehear discovery motions the state lost in three counties. In those counties -- Hunterdon, Burlington and Bergen -- judges have ordered the state police to hand over internal documents the agency fought to keep under wraps. In all three cases, the state has successfully moved for leave to file interlocutory appeals. But then it rushed to the Supreme Court in late December, bypassing the Appellate Division. The state argued that it was moving to improve case management, especially in light of the lack of uniformity in discovery rulings by different judges against the same agency for the same claims. Defense lawyers countered in court papers that the move smacked of judge-shopping and was an effort to get a second bite at the apple and stall disclosure of politically embarrassing documents. A lack of uniformity in judicial rulings is a key reason for having appellate courts, they protested. Under the Supreme Court's administrative order, Barisonek will serve as the statewide manager for discovery motions where defendants allege they were selectively pulled over by troopers because they are black or Hispanic. But Barisonek, who sits in the Criminal Part, will not rehear existing discovery motions already resolved, or pending appeal. "We are satisfied with the order," says First Assistant Public Defender Joel Harris. His office had filed opposition papers with the high court charging that the state was seeking a "do-over" in Hunterdon, Burlington and Bergen counties because it saw "the handwriting on the wall." Harris adds that the order suggests to him that Barisonek will wait to see how the Appellate Division rules on the state's appeals of its discovery losses before the three trial judges. "I think that Judge Barisonek can't really do anything more than identify those cases where profiling is alleged to have occurred, but then wait to see what the appeals panel does." The high court's order also designates a single panel to hear the pending appeals. It does not identify the panel, but a court spokeswoman says that Judge Sylvia Pressler, the presiding judge for administration, has selected Part H, presided over by Judge Edwin Stern. The panel includes Judges Howard Kestin, Dorothea Wefing and Isaiah Steinberg. Chief Justice Deborah Poritz and Associate Justice Peter Verniero recused themselves from the deliberations. They served as attorneys general in the Whitman administration and supervised the state police during the period in which the state concedes that some racial profiling occurred. As attorneys general, they fought the profiling charges in the seminal case in Gloucester County, State v. Soto, 324 N.J. Super. 66 (Law Div. 1996). In Soto, a trial judge concluded that racial profiling was being practiced by troopers on the southern portion of the New Jersey Turnpike. And it was on the eve of appellate oral arguments in Soto, last April, that the state flipped-flopped, withdrew its appeal and acknowledged in an interim report by Division of Criminal Justice Director Paul Zoubek that racial profiling had taken place. That report has opened a floodgate of challenges based on allegations of racial profiling, with more expected. Public defender Harris says the P.D.'s Middlesex County office is ready to file selective-enforcement claims on behalf of about 18 other drug defendants. Jurisdictional Issue Avoided In their opposition papers, public defenders argued that the Supreme Court lacked jurisdiction to even entertain Farmer's motion. They point to the state Constitution, Art. 6, sec. 2, para. 2, which says the Court "has no original jurisdiction over cases" because its jurisdiction is solely appellate. But the five justices hearing the motion, led by acting chief judge Daniel O'Hern, agreed with the state that the request was administrative rather than judicial. In fact, before filing the motion, Zoubek asked Richard Williams, director of the Administrative Office of the Courts, to name a single judge, to stay all discovery motions and to have that judge hear all motions, including those already decided. When the public defenders balked at a subsequent meeting in early December, Williams said he told Zoubek to have the Attorney General's Office file a motion. The Court's order makes clear that it looks upon the request as administrative, describing the motion as "seeking centralized judicial management of pending litigation ... " The Court's accompanying media advisory begins, "Pursuant to its constitutional authority, the Supreme Court has determined to provide prospective statewide management of discovery motions ... " The advisory likens the move to the practice of naming one judge to manage mass tort class actions, such as in asbestos, pharmaceutical or fire-retardant plywood cases. "The goal is to ensure efficiency and consistency in the management of multiple cases presenting the same or similar issues," the advisory states. Once all motions are decided, and the cases are ready for trial, they will be shipped to the trial judges of original jurisdiction, according to the order. The order did not address the attorney general's request that the Court "structure ... the representation of the parties," which defense attorneys say was a move to limit the defense in violation of the Sixth Amendment. Zoubek says the state had no intention of infringing on Sixth Amendment rights of defendants, but adds that the state would ask the Public Defender's Office, which is handling more than 80 percent of the cases, whether it was interested in assembling a defense team to litigate the common discovery issues that will be before Barisonek. Harris said defense attorneys are considering such an arrangement. Moorestown solo practitioner William Buckman, who represents defendants with profiling claims in the three key counties where rulings have been rendered, says he, too, is satisfied with the order for the most part. "The Court saw through the ruse of the attorney general, which was to get out from under the rulings it has lost," Buckman says. Tough on Defendants Barisonek, 55, a Republican, has been on the bench since 1984 and was granted tenure in 1991. He started in the Family Part and in less than a year became presiding judge. In September 1987, he was transferred to the Civil Part, moving again, a year later, to the Criminal Part. He became presiding judge of that part in September 1993 and served in that role until September 1997. He also had, until recently, been the designated Megan's Law judge for Union County, hearing challenges by former sex- offenders to their tier-classification for notification purposes. He consistently has received high marks by practitioners in three judicial surveys conducted by the Law Journal. In the latest survey, published in January 1999, Barisonek placed seventh out of the 21 judges in Elizabeth, with a score of 4.06 out of a possible 5 in overall competency. That put him in a six-way tie for 89th place among the state's 348 trial judges at the time. However, in three categories that in some way reflect on case management -- ability to handle complex cases, convening court and moving cases without delay, and issuing orders, judgments and opinions without delay -- Barisonek placed fourth, sixth and fifth, respectively. That was his poorest showing. In the Law Journal's first survey, published in January 1989, Barisonek finished third in overall competence among Union County's 20 judges at the time, with a score of 8.4 out of a possible 10. In the September 1993 survey, Barisonek, who at the time had just been elevated to presiding criminal judge, placed first among the 25 judges sitting in Union County at the time. Statewide, his score of 8.85 out of 10 was the sixth-highest. Perhaps more important, he was smack in the middle of the pack on the question of his inclination in criminal cases, suggesting no leanings, and was rated third-best in the likelihood of not showing bias. In the most recent survey in January 1999, he did not fare as well in those categories, but still was given a relatively high rating, seventh out of the 25 Union judges, in being free of racial and ethnic bias. Barisonek served as municipal prosecutor in Roselle, from 1969 to 1973, and in Clark, from 1981to 1984. After graduation from law school, he handled equal opportunity cases as a staff attorney for Essex County Legal Services from 1968 to 1969. He is considered a tough sentencer and is known for letting defendants know how he feels on sentencing day. In sentencing an Elizabeth man to 50 years in 1990 for beating a nurse in a church parking lot, Barisonek said the defendant had beaten his victim "into oblivion ... You stalked this woman like a hunter stalking prey." He added that the brutal attack left the nurse "devastated physically, emotionally, psychologically and every other way you can think." In June 1992, a woman was scheduled to appear in his courtroom at 9 a.m. for sentencing after admitting she smuggled cocaine to her son at the county jail. The son was a convicted murderer. When she failed to show, Barisonek issued a bench warrant, and when she appeared at 10:30 a.m. he ordered her jailed until the rescheduled sentencing, in two weeks. (159 N.J.L.J. 485) (New Jersey Law Journal February 7, 2000) POLICY MANAGEMENT: Wolf Haldenstein Files Securities Suit in NY --------------------------------------------------------------- The law firm of Wolf Haldenstein Adler Freeman & Herz LLP filed a securities class action lawsuit in the United States District Court for the Southern District of New York on behalf of investors who bought Policy Management Systems, Inc. stock between October 22, 1998 and February 9, 2000. The lawsuit charges Policy Management and certain officers of the Company, with violations of the securities laws and regulations of the United States. The lawsuit alleges that defendants issued a series of false and misleading statements during the Class Period concerning the Company's financial condition, products, technologies and financial statements. The complaint alleges that defendants' false and misleading statements artificially inflated the price of the Company's stock during the Class Period. Contact: Wolf Haldenstein Adler Freeman & Herz LLP at 270 Madison Avenue, New York, New York 10016, by telephone at (800) 575-0735 (Michael Miske, George Peters, Gregory Nespole, Esq., Fred Taylor Isquith, Esq. or Shane T. Rowley, Esq.), via e-mail at classmember@whafh.com or visit website at http://www.whafh.com SUNSTAR HEALTHCARE: Burt & Pucillo Files Securities Lawsuit in FL ----------------------------------------------------------------- Burt & Pucillo, LLP commenced a securities lawsuit in the United States District Court for the Middle District of Florida, Orlando Division, on behalf of purchasers of securities of Sunstar Healthcare, Inc. during the period between November 13, 1998 and December 14, 1999. The complaint alleges that Sunstar's senior management and certain controlling persons of Sunstar violated the Securities Exchange Act of 1934 as a result of the issuance of a series of materially false and misleading financial statements due to the failure to take adequate reserves to pay foreseeable healthcare claims. The complaint seeks damages on behalf of the Class. For additional information concerning this lawsuit, you may contact plaintiff's counsel, Michael J. Pucillo at Burt & Pucillo, at 561/835-9400 or 800/349-4612, or e-mail address: law@burt-pucillo.com or burtpucill@aol.com SYKES ENTERPRISES: Gilman and Pastor Files Securities Suit in FL ---------------------------------------------------------------- Gilman and Pastor, LLP has filed a securities class action lawsuit in the United States District Court for the Middle District of Florida against Sykes Enterprises, Inc. and certain of the Company's officers and directors on behalf of purchasers of Sykes common stock during the period July 26, 1999 through February 6, 2000, inclusive. Plaintiff's complaint alleges that defendants violated the federal securities laws by issuing to the investing public false and misleading financial statements and press releases which overstated Sykes' reported revenues and earnings, and misled the marketplace as to its purportedly rapid growth and prospects. On the morning of February 7, 2000, Sykes disclosed that fourth quarter 1999 results were significantly below both market expectations and its results for fourth quarter of 1998. The shortfall was due in major part to revenue recognition issues which required Sykes to delay recognizing revenues, and to restate downward its previously reported results for the second and third quarters ended June 30 and September 30, 1999. As a result, Sykes' net income for these quarters was reduced by 67%. Sykes further conceded that in light of the restatement, it expected 2000 earnings of about $1.10 per share, well short of analysts' expectations of $1.53 per share. On February 7, 2000, the market price of Sykes' common stock, which had traded as high as $51 per share during the Class Period, plunged to $14-1/4 per share, thereby culminating in a decline of more than 70% in value over a three-week period. Contact: Peter Lagorio, Esq. Gilman and Pastor, LLP. One Boston Place, 28th Floor, Boston, MA 02108 Telephone 617-589-3750 Telecopier 617-589-3749 e-mail at plagorio@aol.com * Blacks in Govt Urge Clinton to Protect Diversity Programs in Hiring --------------------------------------------------------------------- Blacks in Government has urged President Clinton to preserve two federal diversity programs that have been deemed outdated, misused and unnecessary by the Merit Systems Protection Board. In a recent report, the MSPB called for the termination of two hiring authorities that were created almost 20 years ago to settle a class action case filed against the federal government. BIG President Jerald Reed told the president in a letter that the intent of the programs "was and continues to be" to increase the representation of blacks and Hispanics in administrative jobs. "It is amazing that the MSPB was established to serve as the guardian of the federal government's merit-based system of employment," Reed said. "Yet, to step forward with a recommendation as such goes against the principles of inclusiveness and diversity which the MSPB purports to convey." Reed called on the president to "intervene on behalf of all minorities" by rejecting the MSPB's recommendation. "Instead, direct the Office of Personnel Management to provide stronger leadership by providing clearer guidance to federal departments and agencies so that the [programs] can be used as originally intended," he said. The MSPB found that agencies were abusing the programs. Through the Outstanding Scholar Program, the government can hire college students with GPAs of 3.5 or better. The Bilingual/Bicultural Program allows agencies to select candidates who meet minimum qualification requirements if they have Spanish language ability or knowledge of Hispanic culture. According to the MSPB, both programs provide managers an easy way to obtain new hires, avoiding the normal competitive process. In 1997, more than 75 percent of outstanding scholar appointees were white, most of them women. Following the MSPB's report, OPM Director Janice Lachance defended the programs, saying they were "important tools to help agencies recruit and achieve a diverse work force." (Federal Human Resources Week, February 10, 2000) * FTC Plans to Beef up Action against Fraud in Online Auctions -------------------------------------------------------------- Federal and state trade regulators said they would beef up enforcement action against fraud in online auctions, following a flood of consumer complaints, the Wall Street Journal said. According to the Journal, the Federal Trade Commission last year received more than 10,000 complaints about online business transactions. The FTC's consumer protection bureau is creating a database of complaints received by state officials, consumer groups and auction-site managers, the newspaper said. The FTC also said it had reached an agreement with eBay Inc. [EBAY], the nation's largest online auctioneer, to forward fraud complaints it receives from its 10 million customers. A senior FTC attorney told the Journal the most common complaints involved goods that were paid for but never delivered. It quoted an eBay representative as saying that only about 0.05 percent of its transactions result in fraud complaints, but compamny officials are concerned that a rising number could scare away customers. (Reuters (New York), February 15, 2000) * Washington Post Says Class Act Ban in Bill Debilitating for VA's Poor ----------------------------------------------------------------------- Swindled seniors, exploited migrant workers and battered women: Who would deny them access to equal representation in the courts? The supporters of a bill pending in the Virginia Senate would. Senate Bill 760, along with two budget amendments, would bar many low-income people from receiving the aid of state-funded legal services lawyers in civil cases. And for those low-income Virginians who still qualified for such help, the bill would bar their lawyers from using the same important tools available to others in the state who are able to pay for legal counsel. The legislation is apparently the result of hard lobbying by the American Farm Bureau Federation, the nation's largest farm lobby. For decades, this corporate giant has fought hard against health and safety protections for farm workers. In the mid-1980s, it opposed a proposed federal rule requiring farmers to provide toilets and places for fruit and vegetable pickers to wash their hands. Similarly, it has fought to keep open a loophole in federal labor law that allows children of elementary-school age to work in the fields. In the past three years, the nonprofit Virginia Justice Center, which is funded by state and other sources, has successfully represented migrant workers forced to live in housing exposed to pesticides and animal wastes and deprived of the minimum wage and overtime. Now the Farm Bureau is attempting to deny most agricultural workers the ability to obtain legal counsel to fight these and other abuses. Even the Farm Bureau should have cause to be embarrassed by some of the consequences of this legislation. Because the bill would prevent undocumented immigrants from obtaining legal services representation, many battered wives would be left at the mercy of their assailants, unable to receive the assistance of state-funded lawyers to help them obtain restraining orders. Moreover, all low-income Virginians would be effectively prevented from participating in class-action lawsuits, no matter how urgently needed. The ban on class actions by legal services lawyers is particularly debilitating for low-income people because such suits are an efficient and effective way --often the only way -- to address and correct serious harms that affect more than one person. For example, in 1994 the Central Virginia Legal Aid Society and the Virginia Poverty Law Center represented a 67-year-old widow living on Social Security and several hundred other low-income Virginians who had been tricked into signing home mortgages accompanied by high, undisclosed broker's fees. As a result, several mortgage brokers and a financial services company were required to pay each victim as much as $ 7,500. Had the Senate bill then been in place, restricting the lawyers to proceeding only on behalf of the individual widow, the many other victims would likely never have been compensated for their losses. The other proposed restrictions are equally harmful. State-funded legal services attorneys would be barred from representing clients in a range of important actions, such as challenging welfare laws, representing prisoners even in non-criminal proceedings such as child custody disputes or defending public housing residents in eviction proceedings when those proceedings rest on an accusation of illegal drug activity. Moreover, these lawyers for the poor would be barred from seeking attorneys' fees from opposing parties. While legal services attorneys do not profit personally from attorneys' fees, the threat of such an award plays an essential role in deterring illegal behavior. Most disturbing of all is that the legislation seems intended to extend the whole set of restrictions to the work of lawyers for the poor even where such work is supported by non-state funds. While it is troubling for a democratic society whenever the government tries to undercut the quality of the legal representation it offers to those unable to afford counsel, it is even further out of bounds for the government to undercut the legal representation that private citizens seek to make available to those in need. The writers are staff attorneys at the Brennan Center for Justice at New York University School of Law. (The Washington Post, February 15, 2000) ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc., Washington, DC. Romeo John D. Piansay, Jr., editor, Theresa Cheuk, Managing Editor. Copyright 1999. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *