/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/000307.MBX C L A S S A C T I O N R E P O R T E R Tuesday, March 7, 2000, Vol. 2, No. 46 Headlines ABLE TELECOM: No Progress This Year in Securities Litigation ARAHOVA COMMUNICATIONS: TCI's Cable Late Fee Settlement Immaterial CIA: Ex-Agent Sues over Diagnosis and Denial of Rights to Counsel COCA-COLA: Black Former Employees Rally Alleging Racism in Job Cuts COMPAQ COMPUTER: Discovery Proceeds Slowly With Bondholders COMPAQ COMPUTER: Moves for Reconsideration of Order Denying Dismissal FOCUS ENHANCEMENT: Abbey, Gardy Files Securities Suit in MA GENERAL ELECTRIC: Customers Say Dishwasher Recall Forces Them to Buy KB TOYS: African American Consumers Ready to File Racism Case ILLINI CORP.: Illinois Bank Sweeps Legal Doubleheader over Poison Pill LEXECON INC: Turns Back against Milberg after Settling Securities Suit MARCOS: US Judge Rejects Petition for Termination Of Settlement Deal ROCKWELL INTERNATIONAL: KY Appeals Ct Throws out '96 Jury Award Re PCBs SILICON GRAPHICS: 9th Cir. Order Dismissing Securities Suit is Final SILICON GRAPHICS: Awaiting Voluntary Dismissal in Cal. Sup. Ct. SILICON GRAPHICS: Discovery Rekindles after Remand in Alias Case THOMAS & BETTS: Stull, Stull Files Securities Suit in Tennessee THQ, INC: Steven E. Cauley Files Securities Suit in California THQ, INC: Whittington, von Sternberg Files Securities Suit UPGRADE INTERNATIONAL: Steven E. Cauley Files Securities Suit in WA ********* ABLE TELECOM: No Progress This Year in Securities Litigation ------------------------------------------------------------ In 1998, Shipping Financial Services Corp. filed a lawsuit in the United States District Court for the Southern District of Florida against ABLE TELCOM HOLDING CORP., and certain of its officers. SFSC asserts claims under the federal securities laws against the Company and four of its officers that the defendants allegedly caused the Company to falsely represent and mislead the public with respect to two acquisitions, COMSAT Corporation and MFS Network Technologies, Inc., and the ongoing financial condition of the Company as a result of the acquisitions and the related financing of those acquisitions. SFSC seeks certification as a class action on behalf of itself and all others similarly situated and seeks unspecified damages and attorneys' fees. In its annual report, Able Telecom reports no progress during the past year in this securites-related litigation. ARAHOVA COMMUNICATIONS: TCI's Cable Late Fee Settlement Immaterial ------------------------------------------------------------------ Plaintiffs have filed or threatened separate class action complaints against cable systems across the United States alleging that the systems' practice of assessing an administrative fee to subscribers whose payments are delinquent constitutes an invalid liquidated damage provision, a breach of contract, and violates local consumer protection statutes, ARAHOVA COMMUNICATIONS, INC., observes in a recent regulatory filing in which it delivered to the Securities and Exchange Commission copies of pro forma financial statements. Plaintiffs seek recovery of all late fees paid to the subject systems as a class purporting to consist of all subscribers who were assessed such fees during the applicable limitation period, plus attorney fees and costs. In December 1999, Arahova relates, a settlement was reached with respect to one of the late fee class action complaints, which involves certain of the TCI Century Systems. The settlement did not have a material impact on TCI Century Systems' financial condition or results of operations. CIA: Ex-Agent Sues over Diagnosis and Denial of Rights to Counsel ----------------------------------------------------------------- John Spinelli, the only CIA operations officer wounded in Somalia supporting U.N. peacekeepers in 1993, filed suit this week against the agency, alleging that CIA officials denied him access to adequate medical care for post-traumatic stress once he physically recovered from gunshot wounds to the neck and shoulder. Spinelli, who retired in 1998 and now works as an international security consultant, alleges that CIA medical personnel repeatedly misdiagnosed "symptoms characteristic of serious emotional or psychological injury" and cleared him to return to a foreign assignment that only exacerbated his post-traumatic stress. "Despite [Spinelli's] obvious symptoms of psychological dysfunction," the lawsuit states, "the CIA never provided any psychotherapy or other treatment beyond one set of tranquilizers." Spinelli also alleges in the suit that the CIA denied his attorney access to his medical and personnel files needed to pursue a claim for disability compensation. CIA spokesman Mark Mansfield declined comment on Spinelli's suit but said CIA Director George J. Tenet's position is that "people are our most valuable resource, and taking care of them is the most important thing we can do." Spinelli is represented by Roy W. Krieger, an attorney who has developed a cottage industry of suing the CIA. He has filed a class action lawsuit, alleging the agency systematically denies its employees' rights to counsel in internal disputes. And he is fighting a security clearance case that he believes stands in sharp contrast to that involving former CIA director John M. Deutch. Deutch was stripped of his CIA security clearances last summer by Tenet, his successor, for violating security regulations by drafting top-secret memos on unsecure home computers linked to the Internet during his tenure as director from May 1995 to December 1996. But Deutch was allowed to keep his Defense Department clearances, necessary for work as a defense consultant-- privileges he only relinquished last month after the media reported his "industrial" clearances had never been revoked. Krieger said his client, a government contractor, hasn't been so fortunate. The client's problems began last year, when he agreed to take a polygraph examination to obtain the top-secret security clearance necessary for access to CIA headquarters. He already had top-secret clearances from other defense agencies. But CIA officials refused his request for clearance, saying they detected problems with his polygraph. Krieger pointed out there was no evidence on the polygraph or elsewhere that his client had ever broken the law or mishandled classified information. But CIA officials, he said, immediately insisted that all of his client's other security clearances be revoked and now his client is facing the loss of his job. "It almost seems vindictive what they did to him," Krieger said, "especially in contrast to Deutch." An intelligence official responded that the CIA does not make clearance determinations solely on the basis of polygraph results. (The Washington Post, March 3, 2000) COCA-COLA: Black Former Employees Rally Alleging Racism in Job Cuts ------------------------------------------------------------------- An estimated 500 black former Coca-Cola employees rallied in Atlanta over the weekend, calling the company's massive job cuts racially motivated and accusing Coke of mistreating workers. At the same time, the National Association for the Advancement of Colored People threatened a national boycott of Coke products. The Atlanta-based company, the world's largest soft-drink producer, faces allegations that it tolerated discrimination in pay scales, promotions, and performance reviews. Coke denies the claims. A court is considering whether to grant class-action status to the case. (The Christian Science Monitor, March 6, 2000) COMPAQ COMPUTER: Discovery Proceeds Slowly With Bondholders ----------------------------------------------------------- Several purported class action lawsuits were filed against Digital Equipment Corporation (acquired by Compaq Computer Corporation in 1998) during 1994 alleging violations of the Federal Securities laws arising from alleged misrepresentations and omissions in connection with Digital's issuance and sale of Series A 8-7/8 percent Cumulative Preferred Stock and Digital's financial results for the quarter ended April 2, 1994. During 1995, the lawsuits were consolidated into three cases, which were pending before the United States District Court for the District of Massachusetts. On August 8, 1995, the Massachusetts federal court granted the defendants' motion to dismiss all three cases in their entirety. On May 7, 1996, the United States Court of Appeals for the First Circuit affirmed in part and reversed in part the dismissal of two of the cases, and remanded for further proceedings. The parties are proceeding with discovery. WHX CORPORATION: Securities Plaintiffs Not Pursuing Case Two purported class action lawsuits were commenced in connection with the unsolicited tender offer commenced by WHX Corportation in December 1998 to acquire all of Handy & Harman's shares for $30 per share in cash (the "Initial WHX Offer"). Both of these purported class actions are not actively being pursued by the plaintiff at the present time. As previously reported in the CAR, on June 25, 1998, the Securities and Exchange Commission ("SEC") instituted an administrative proceeding against the Company alleging that it had violated certain SEC rules in connection with the tender offer for Dynamics Corporation of America ("DCA") that commenced on March 31, 1997 through the Company's wholly owned subsidiary, SB Acquisition Corp. (the "Offer"). The Company previously disclosed that the SEC intended to institute this proceeding. Specifically, the Order Instituting Proceedings (the "Order") alleges that, in its initial form the Offer violated the "All Holders Rule," Rule 14d-10(a)(1) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), based on the Company's inclusion of a "record holder condition" in the Offer. No shareholder had tendered any shares at the time the condition was removed. The Order further alleges that the Company violated Rules 14d-4(c) and 14d-6(d) under the Exchange Act upon expiration of the Offer, by allegedly waiving material conditions to the Offer without prior notice to shareholders and purchasing the approximately 10.6% of DCA's outstanding shares tendered pursuant to the Offer. The SEC does not claim that the Offer was intended to or in fact defrauded any investor. The Order instituted proceedings to determine whether the SEC should enter an order requiring the Company (a) to cease and desist from committing or causing any future violation of the rules alleged to have been violated and (b) to pay approximately $1.3 million in disgorgement of profits. The Company has filed an Answer denying any violations and seeking dismissal of the proceeding. Last year, an administrative law judge of the SEC held an evidentiary hearing on the merits, but a decision has not been rendered to date. Although there can be no assurance that an adverse decision will not be rendered, the Company intends to continue to vigorously defend against the SEC's charges. DTE ENERGY: Binding Arbitration Awards Plaintiffs $41.15 Million Detroit Edison and plaintiffs in a class action pending in the Circuit Court for Wayne County, Michigan (Gilford, et al v. Detroit Edison), as well as plaintiffs in two other pending actions which make class claims (Sanchez, et al v. Detroit Edison, Circuit Court for Wayne County, Michigan; and Frazier v. Detroit Edison, United States District Court, Eastern District of Michigan), agreed to binding arbitration to settle these matters. A Consent Judgment received preliminary Court approval. On October 28, 1999, a panel of arbitrators awarded the plaintiffs $45.15 million. As a result of sufficient prior accruals and anticipated insurance coverage, Detroit Edison did not incur a material 1999 earnings impact due to this award. Detroit Edison anticipates that the insurance claims process will conclude favorably. While Detroit Edison can give no assurances as to the final resolution of the claims process, it does not believe that an unfavorable earnings impact will result. COMPAQ COMPUTER: Moves for Reconsideration of Order Denying Dismissal --------------------------------------------------------------------- Compaq Computer Corporation is vigorously defending two consolidated class action lawsuits alleging violations of Section 10(b) and Section 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, in the United States District Court for the Southern District of Texas, Houston Division. These lawsuits are against named defendants including Compaq and certain of its current and former officers and directors. One lawsuit was filed in 1998 and the other in 1999. The 1998 litigation consolidates five class action lawsuits, brought by persons who purchased Compaq common stock from July 10, 1997 through March 6, 1998. Among the allegations in the 1998 lawsuits are that the defendants withheld information and made misleading statements about channel inventory and factoring of receivables in order to inflate the market price of Compaq's common stock and further alleges that certain of the individual defendants sold Compaq common stock at the inflated prices. The 1999 litigation consolidates over 30 class action lawsuits. The 1999 litigation is brought by purchasers of Compaq common stock between January 27, 1999 and April 9, 1999 and alleges, among other things, that named defendants and Compaq issued a series of materially false and misleading statements that failed to disclose that sales to small and medium size businesses were slow in January 1999 in order to inflate the market price of Compaq's common stock and further alleges that certain of the individual defendants sold Compaq common stock at the inflated prices. Lead counsels for the plaintiffs have been appointed in both the 1998 and 1999 litigation. The plaintiffs seek monetary damages, interest, costs and expenses in both the 1998 and 1999 litigation. Compaq has filed motions seeking to have both the 1998 and 1999 litigation dismissed by the Courts. Compaq's motion to dismiss the 1998 litigation was denied and Compaq has filed a motion for reconsideration. FOCUS ENHANCEMENT: Abbey, Gardy Files Securities Suit in MA ----------------------------------------------------------- A class action against Focus Enhancement, Inc. (Nasdaq: FCSE) and certain of its officers and directors has been commenced in the United States District Court for the District of Massachusetts on behalf of all persons who purchased shares of Focus common stock between April 15, 1999 and March 1, 2000. In brief, the Complaint charges that Focus and certain of its officers and directors, violated the federal securities laws. The Complaint alleges that during the Class Period defendants made materially false and misleading statements regarding, among other things, the financial condition of Focus. On March 1, 2000, the Company announced that its independent auditors had informed the Board of Directors that it had discovered irregularities relating to the Company's financial controls for fiscal year ended December 31, 1999 and prior quarters. A committee has been formed by the board to investigate the matter. Contact: Mark C. Gardy, or Nancy Kaboolian, or Maria Criscitiello, 800-889-3701, 212-889-3700, mcriscitiello@a-g-s.com all of Abbey, Gardy & Squitieri, LLP GENERAL ELECTRIC: Customers Say Dishwasher Recall Forces Them to Buy -------------------------------------------------------------------- When Charles Durkee heard the news last October that General Electric had issued a recall of one of its dishwashers because it could catch fire, he contacted the company to see if his could be repaired. The answer was no. And he couldnt return the appliance and get his money back. The company only offered him a rebate if he would buy a new one -- $ 125 for a top-of-the-line model and less for cheaper ones. So, Durkee became the named plaintiff in a suit seeking class action status on behalf of as many as 3.1 million GE dishwasher owners nationwide. "You have a product that was manufactured as a fire hazard that can burn down people's homes. Instead of doing right by the customer and fixing it, they are trying to make it into a marketing program and increase their sales," said Steven Hunter of Angones Hunter McClure Lynch & Williams in Miami, the firm that filed the suit on behalf of Durkee. The Miami-Dade Circuit Court suit is the second one to be filed in Florida. A similar suit was filed in U.S. District Court in Tampa by consumers who, like Durkee, believe the recall and rebate program is little more than a way for the company to sell more appliances. The rebate program also caught the eye of New Yorks attorney general, who notified the company that he plans to file suit against GE. GE calls the litigation and threats of more suits by New York's attorney general grandstanding. At issue is an energy saver switch that the company says can catch fire. However, in a letter to Durkee and other consumers, GE said replacing the switch would require that the entire door be reassembled and the parts are no longer available. The dishwashers in question were made between 1983 and 1989. From what I have read that is flat-out not true, Hunter said. Similar notices that went out to commercial users said an accommodation could be made and that the switch could be re-wired. It's not like we are asking them to do anything for these consumers that they haven't done for commercial users. Why should one group be treated differently? Hunter said. The suit alleges that consumers are being forced to buy new GE dishwashers at their own expense instead of GE fulfilling its legal and moral responsibilities to remedy a potentially life threatening defect in a product brought into millions of American homes. What angers Hunter most is that he believes GE knew for a period of time that they had a product that was exposing people to a risk of death by fire, but failed to do anything until the Consumer Product Safety Commission became involved. Durkee said he contemplated buying a new dishwasher, but became upset when he learned that the $ 75 he would have received in the form of a rebate check would then have to be spent on the cost of delivering the new machine. That is simply not appropriate under Florida law, said Hunter. In addition to asking for unspecified damages, the class-action suit asks that GE be prevented from telling consumers that there is no way the dishwasher can be fixed and to reimburse them for the amount it costs to repair them. (Broward Daily Business Review, March 2, 2000) KB TOYS: African American Consumers Ready to File Racism Case ------------------------------------------------------------- A notice on March 6 says that a class action discrimination lawsuit was to be filed on the same day against KB Toys in the U.S. District Court for the District of Maryland, Southern Division, by the Equal Rights Center and five African American consumers in the Baltimore-Washington area. Plaintiffs Avis E. Buchanan, Dr. Albert R. Conley, Ardelia Crawford Carolyn Kornegay-Belton and Yvette D. Tate were planning to file action with The Equal Rights Center on behalf of themselves and all similarly situated African-American customers of KB Toys located in the Washington-Baltimore Metropolitan Area. The plaintiffs seek to have this action certified as a class action. This filing amends and expands upon the December 1999 civil rights litigation filed by The Equal Rights Center and two African American plaintiffs. Consolidated Stores Corp. d/b/a KB Toys discriminated against plaintiffs and members of the class they seek to represent on the basis of their race or color by: (a) refusing to accept their personal checks and requiring that they pay for their purchases with cash or credit cards; (b) providing them with different and inferior service to that received by white customers; and (c) offering merchandise under different terms and conditions than those offered to white customers. Testing by The Equal Rights Center has uncovered a pattern and practice of discrimination by Consolidated Stores Corp. d/b/a KB Toys against African-Americans in the Washington-Baltimore Metropolitan Area. Specifically, testing has revealed that defendant has implemented check acceptance policies intentionally designed to deny African-Americans the right to pay for merchandise by check at KB Toys stores. This policy is and has been implemented by refusing to permit the use of personal checks at KB Toys stores that have a predominately African-American clientele or customer base, while permitting the use of checks at KB Toys stores that have a predominately white clientele or customer base. By its actions, defendant has denied plaintiffs and members of the class they seek to represent the right to make and enforce contracts on the same basis as white citizens and frustrated the mission of TERC, in violation of 42 U.S.C. 1981, as amended. "Major consumer electronic check and debit companies have informed us that no legitimate business defense exists to justify the patently discriminatory policy that KB Toys has implemented in the Baltimore Washington D.C. metropolitan area at stores frequented by African American consumers. We hope that consumers will come forward to challenge this overt form of consumer racism and retail redlining to become part of the class by contacting The Equal Rights Center at 800-603-FAIR," stated David Berenbaum, executive director of The Equal Rights Center. Plaintiffs seek punitive and compensatory damages, a declaratory judgment, and an injunction directing defendant to desist from and remedy its illegal conduct. For more information or for a copy of the complaint, please contact David Berenbaum, executive director of The Equal Rights Center, at 202-289-5360, ext. 34, or counsel for plaintiffs, John Relman at Relman and Associates, 202-728-1118 and Jeffrey D. Robinson at BAACH, ROBINSON & LEWIS at 202-833-8900. David Berenbaum of the Equal Rights Center, 202-289-5360 ILLINI CORP.: Illinois Bank Sweeps Legal Doubleheader over Poison Pill ---------------------------------------------------------------------- A two-year legal battle over Illini Corp.'s poison-pill policy has ended in the Springfield, Ill., company's favor. Macoupin County Judge Thomas Carmody has dismissed two shareholder lawsuits against Illini, the $169 million-asset parent of Illini Bank. The suits, filed in 1998, questioned whether Illini could bar individual shareholders from owning more than 10% of its stock. Both suits stemmed from a gift of 1,200 Illini shares that Ida R. Noll, daughter-in-law of one of the bank's founders, received from her mother in April 1998. The gift nudged Ms. Noll's ownership above 10%, which was the threshold for triggering the poison pill. A poison pill is a plan designed to protect companies against hostile takeovers by authorizing additional stock to be issued at a reduced price to all stockholders other than the potential acquirer. Shortly after Ms. Noll received the gift, however, the Illini board opted not to trigger the poison pill, ruling that she had acted "inadvertently." Illini's refusal to act angered other shareholders, who filed a class action demanding that the rights plan be activated in order to increase the value of their holdings. The lead plaintiff was Mary K. Quinn, a former Illini employee who owns 21 shares, worth about $550. Meanwhile, Ms. Noll filed her own suit, asking that the poison-pill provision adopted in 1997 -- be declared invalid because, she argued, it discriminated against Noll family members. The Nolls together own 31% of the company's stock. Judge Carmody rejected Ms. Noll's argument as well as Ms. Quinn's contention that the poison pill should have been activated. (The American Banker, March 3, 2000) LEXECON INC: Turns Back against Milberg after Settling Securities Suit ---------------------------------------------------------------------- Milberg, Weiss, Bershad, Specthrie & Lerach, a plaintiffs' class action law firm, named economic consulting firm Lexecon Inc. and Daniel R. Fischel, a Lexecon principal, as defendants in a securities fraud lawsuit. The case arose from the failure of Lincoln Savings & Loan. Lexecon settled, admitting no wrongdoing, then sued Milberg Weiss, charging abuse of process. Lexecon claimed that Milberg Weiss had sued "for the purpose of trying to tarnish Lexecon and Mr. Fischel," said plaintiff's attorney Alan Salpeter, of Chicago's Mayer, Brown & Platt. Mr. Fischel was "the target of their wrath" after he had testified against one of their clients as a defense expert in another case, he said. Milberg Weiss attorneys had vowed to put Lexecon and Mr. Fischel out of business, Mr. Salpeter said. On April 13, 1999, a Chicago jury awarded Lexecon $ 45 million in compensatory damages against the law firm, by then known as Milberg, Weiss, Bershad, Hynes & Lerach. The case was settled that day, for $ 50 million, before the jury could consider punitives. The case is Lexecon Inc. v. Milberg, Weiss, Bershad, Specthrie & Lerach, No. 92 C 7768 (N.D. Ill.) (The National Law Journal, February 28, 2000) MARCOS: US Judge Rejects Petition for Termination Of Settlement Deal -------------------------------------------------------------------- A US district court judge in Hawaii has rejected a petition to terminate a 150-million-dollar settlement between the family of the late Philippine dictator Ferdinand Marcos and victims of human rights abuses during his rule, a lawyer for the victims said. Rod Domingo, a lawyer representing half of the 10,000 human rights victims, said Judge Manuel Real set another hearing on April 24 to allow the Marcos family more time to pay up. Domingo and US lawyer Robert Swift had asked Real during a hearing in Honololu to terminate the deal, two days after a Philippine anti-graft court nullified the agreement, saying it was "unconstitutional." Nullification of the deal by the US court would allow the victims to demand payment of the entire two billion dollars awarded to them by Real in 1994 when they won a class action suit filed against the Marcos estate. The settlement money was to have been sourced from 540 million dollars the government recovered from Marcos' bank accounts in Switzerland and placed in an escrow account in Manila. The money is now worth 630 billion dollars because of interest. "The situation now is we have to wait until April 24 ... This will effectively give the Marcoses ample time to effect the payment of the 150 million dollars to the victims," Domingo said. He said they would seek the arrest of former first lady Imelda Marcos and demand the entire two billion dollars, plus 700,000 dollars in interest if the settlement falls through. After years of litigation, the victims of torture, rape, forced disappearances and summary killings or their relatives agreed to the 150-milllion-dollar out-of-court settlement in 1999. But the deal, endorsed by President Joseph Estrada, needs the approval of the Sandiganbayan, a special anti-graft court which has yet to resolve legal ownership over the recovered Marcos money. "We are now in the process of looking for other assets of the Marcos estate to answer for the obligation because we feel that if by the time at the next scheduled hearing no payment will be made by the Marcoses, then we will really attach all known properties of the estate," Domingo said in a television intereview here. "We will move for their arrest or detenton in the US courts and coordinate with the government in locating other assets of the Marcoses." He acknowledged they face a tough legal battle ahead. "The Marcoses are indeed tough. They will do every trick in the book to withhold payment of the money. So we will just use whatever legal remedies that can to be able to satisfy the judgement," he said. Marcos was deposed in a bloodless popular uprising in 1986 and died in exile in Hawaii three years later. He and his family have been accused of plundering billions of dollars from the national coffers. (Agence France Presse, March 3, 2000) ROCKWELL INTERNATIONAL: KY Appeals Ct Throws out '96 Jury Award Re PCBs ----------------------------------------------------------------------- Landowners along Town Branch stream and the Mud River in Kentucky charged Rockwell International Corp. with willfully dumping PCBs (polychlorinated biphenyl compounds) into a porous lagoon that overflowed into the stream, and thence into the Mud River. The PCBs, discharged from Rockwell's Russellville aluminum die cast plant, contaminated the land and water along their properties and diminished the value of their holdings, contended the plaintiffs. In May 1996, a Kentucky jury awarded the 77 plaintiffs $ 7.7 million in compensatory damages and $ 210 million in punitives. But, on Jan. 14, 2000, the Kentucky Court of Appeals threw out the verdict and entered judgment for Rockwell as a matter of law. The appellate court ruled that there were very low levels of PCBs in the water and that the plaintiffs had failed to prove their property lost value. The plaintiffs are expected to seek review of the decision at the Kentucky Supreme Court. The case is Houchens v. Rockwell International Corp., No. 93-CI-00158 (Cir. Ct., Logan Co., Ky.) (The National Law Journal, February 28, 2000) SILICON GRAPHICS: 9th Cir. Order Dismissing Securities Suit is Final -------------------------------------------------------------------- A securities class action lawsuit filed in January 1996 in the Northern District of California alleging that Siligon Graphics, Inc., and certain of its officers and directors made material misrepresentations and omissions during the period from September to December 1995, was dismissed with prejudice by the District Court in May 1996. In July, 1999, the U.S. Court of Appeals for the Ninth Circuit upheld the dismissal and in October 1999, the same court declined to rehear the case. The determination of the Ninth Circuit became final in January 2000 and the dismissal is now a final order. SILICON GRAPHICS: Awaiting Voluntary Dismissal in Cal. Sup. Ct. --------------------------------------------------------------- Silicon Graphics, Inc., is defending putative securities class action lawsuits filed in the U.S. District Court for the Northern District of California and in California Superior Court for the County of Santa Clara in December 1997 and January 1998 alleging that SGI and certain of its officers made material misrepresentations and omissions during the period from July to October 1997. The U.S. District Court is considering plaintiffs' motion for a voluntary dismissal of the case without prejudice and defendants' motion for partial summary judgment. Discovery is proceeding in the California Superior Court case. SILICON GRAPHICS: Discovery Rekindles after Remand in Alias Case ---------------------------------------------------------------- Silicon Graphics, Inc., is defending a securities class action lawsuit involving Alias Research Inc., which SGI acquired in June 1995. The Alias case, which was filed in 1991 in the U.S. District Court for the District of Connecticut, alleges that Alias and a former officer and director made material misrepresentations and omissions during the period from May 1991 to April 1992. In October 1997, the defendants' motion to dismiss the amended complaint was granted. In April 1999, the U.S. Court of Appeals for the Second Circuit reversed the dismissal and remanded the case to the U.S. District Court for the District of Connecticut. The U.S. Court of Appeals has denied defendants' petition for rehearing. The case has been remanded to the U.S. District Court and is proceeding through discovery. THOMAS & BETTS: Stull, Stull Files Securities Suit in Tennessee --------------------------------------------------------------- The law firm of Stull, Stull & Brody announces that a class action lawsuit was filed on February 16, 2000, in the United States District Court for the Western District of Tennessee on behalf all persons who purchased the common stock of Thomas & Betts Corporation, (NYSE:TNB) between April 28, 1999, and December 14, 1999. The complaint charges T&B and certain of its senior officers with violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges that defendants issued a series of materially false and misleading statements concerning the Company's operations and earnings which artificially inflated the price of T&B common stock. In particular, the complaint alleges that due to certain customer billing improprieties and over-valued assets, among other things, defendants overstated T&B's previously reported financial results and delayed recognizing over $50 million in charges against pre-tax 1999 earnings. The action further alleges that defendants misled investors concerning the successful implementation of T&B's "web-enabled" order processing systems which had caused serious disruptions to the Company's operations, resulting in an estimated earnings shortfall of over 40% for the fourth quarter of 1999 alone. Prior to the disclosure of the adverse facts described above, the Company completed several acquisitions using the inflated price of T&B common stock as currency for the transactions. When the truth was finally revealed the price of T&B common stock fell over 29% on December 15, 1999, and has declined more than 50% from the Class Period high of over $53 per share reached during September 1999. If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Tzivia Brody, Esq. at Stull, Stull and Brody by calling toll-free 1-800-337-4983, or by e-mail at SSBNY@aol.com or by fax at 212/490-2022, or by writing to Stull, Stull and Brody, 6 East 45th Street, New York, NY 10017. THQ, INC: Steven E. Cauley Files Securities Suit in California -------------------------------------------------------------- The Law Offices of Steven E. Cauley, P.A. announced that a class action has been commenced in the United States District Court for the Central District of California on behalf of purchasers of THQ Inc. (Nasdaq: THQI) publicly traded securities during the period between October 26, 1999 and February 10, 2000. The complaint charges THQ and certain of its officers and directors with violations of the Securities Exchange Act of 1934. THQ develops, publishes and distributes interactive entertainment software worldwide for a variety of hardware platforms including PC CD-ROM and those manufactured by Sega, Nintendo and Sony. The complaint alleges that during the Class Period, THQ falsely represented the state of its business, financial results, and prospects causing its stock price to be inflated to as high as $38-1/4 (split- adjusted). The Individual Defendants named herein took advantage of this inflation and sold 522,912 shares (split-adjusted) of their THQ stock for $14.7 million. Later, THQ selectively disclosed to certain analysts that its first half 2000 results would be much lower than previously represented. After this information was belatedly disseminated to the market, THQ's stock then dropped to as low as $ 17-3/8 per share. If you have any questions regarding this lawsuit or how you may be able to recover for the losses you have incurred, please E-mail or call: LAW OFFICES OF STEVEN E. CAULEY, P.A., 11311 Arcade Drive, Suite 201, Little Rock, AR 72212, E-mail: CauleyPA@aol.com or 1-888-551-9944 - toll free THQ, INC: Whittington, von Sternberg Files Securities Suit ---------------------------------------------------------- Whittington, von Sternberg, Emerson & Wilsher, L.L.P. announced that a class action lawsuit has been filed on behalf of all persons and entities who purchased the common stock of THQ, Inc., (Nasdaq: THQI) between October 26, 1999 and February 10, 2000, inclusive. The Complaint alleges that THQ and certain of its officers and directors violated the federal securities laws. According to the Complaint, defendants knew that the first and second quarter earnings 2000 were going to be materially below the first and second quarters of 1999. Although the defendants knew that the disclosure of this information would have an adverse effect on THQ's stock price, rather than timely disclose this material information publicly, as required by the federal securities laws, on or about February 8, 2000, THQ selectively disclosed this information to certain analysts. As a result of this selective disclosure, top clients of these analysts were able to unload significant holdings in THQ stock prior to the public becoming aware through third party disclosure of THQ's true financial condition. As a direct result of defendant's affirmative decision to selectively disclose material information to a limited group, and not to the investing public, the price of THQ stock was artificially inflated. Contact: plaintiff's counsel John G. Emerson, Jr. Whittington, von Sternberg, Emerson & Wilsher, L.L.P., 2600 S. Gessner, Suite 600, Houston, Texas 77063, Telephone: 713/789-8850, Facsimile: 713/789-0033 or via e-mail at je-mlaw@worldnet.att.net UPGRADE INTERNATIONAL: Steven E. Cauley Files Securities Suit in WA ------------------------------------------------------------------- The Law Offices of Steven E. Cauley, P.A. announced that a class action has been commenced in the United States District Court for the Western District of Washington on behalf of purchasers of Upgrade International Inc. (Nasdaq: UPGD) common stock during the period between Nov. 29, 1999 and Feb. 24, 2000. The complaint charges Upgrade, Daniel Bland and certain of its officers and directors with violations of the federal securities laws by making misrepresentations about Upgrade's business. Specifically, the complaint alleges that the positive statements concerning Upgrade's licensure of the Keepered Media technology from Ampex, the abilities of Upgrade's UltraCard, Upgrade's listing status with Nasdaq, and Upgrade's reporting status with the SEC were materially false and misleading because, at the time Upgrade issued them, and that defendants knew, or were reckless in not knowing, the following adverse information: That the Keepered Media technology had never been proven to work on a credit card type format; * That Ampex, the owner of Keepered Media technology, had discontinued its use as it was too costly for commercial manufacturing and did not believe the technology had any material value; * That the value of Keepered Media technology was so insignificant, its value was not even recorded as an asset on Ampex's financial statements; * That Upgrade had not applied for Nasdaq National Market System listing; * That the UltraCard had not been proven to store 20,000 times the storage capacity of magnetic strip cards; * That Keepered Media technology had only been proven to work on hard drive disks and was financially unfeasible to produce; * That despite its license of Keepered Media technology, Upgrade would not have a product to sell, lease or license until the year 2001; and * That there was no reasonable basis for claiming that Upgrade would be an SEC reporting company by February 24, 2000, as its auditors had not even completed Upgrade's audit. By issuing these allegedly false and misleading statements, defendants artificially inflated Upgrade's stock price from $10-1/2 on 11/29/99 to a Class Period high of $82-1/2 in January 2000, resulting in market capitalization of well over $1 billion, before the true facts about Upgrade's troubled operations and false statements concerning Upgrade's product development efforts were revealed. Contact: Law Offices of Steven E. Cauley, P.A., 888-551-9944, or email, CauleyPA@aol.com ********* 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. 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