CAR_Public/000516.MBX                  C L A S S   A C T I O N   R E P O R T E R

                  Tuesday, May 16, 2000, Vol. 2, No. 95

                                 Headlines

ABTCO, INC: Reaches Preliminary Settlement on Hardboard Siding Action
ACCELR8 TECHNOLOGY: Rabin & Peckel Files Securities Lawsuit in Colorado
DENNY'S RESTAURANTS: Suit Claims Company Exploit Managers
EAST PALO: City to Repay Property Owners Excise Tax, Judge Rules
FORD MOTOR: Supreme Ct Refuses Class Status over Peeling Paint on Truck

GIO: AMP Takes Issue with Press Report; Stays Clear of Takeover Lawsuit
GIO: Lawsuits over AMP Takeover to Proceed
HMOs: Clinton, Gop Negotiate Patients' Rights Bill, Seek Deal On Rules
HOLOCAUST VICTIMS: Easton and Levy Sues Swiss National Bank in CA
HOLOCAUST VICTIMS: US Lawyers Accuse Austrian Law of Discrimination

INMATES LITIGATION: Ct Says Pretrial Detainee with AIDS Deserves Trial
IRS: Minority Women Begin Legal Battle in Houston
NOVARTIS AG: Faces U.S. Lawsuit Alleging Over-Promotion of Ritalin
REDDI BRAKE: Settlement Deal for '97 Securities Suit Remains Pending
SARA LEE: Judge OKs Settlement for Recalled Hot Dogs and Meat Products

SURGUTNEFTEGAZ: Bernstein Liebhard Investigates on Dividend Payment
TOBACCO LITIGATION: Industry Declines Negotiations to End Battles
TOBACCO LITIGATION: Industry to Fight Against Punitive Award in FL Case
TOBACCO LITIGATION: Judge Kaye Delays Penalty Phase  in Lawsuit
WORLD ONLINE: Defense Lawyers Will Answer Some Questions in June Mtg

                                *********

ABTCO, INC: Reaches Preliminary Settlement on Hardboard Siding Action
---------------------------------------------------------------------
ABTco, Inc. announced on May 15 that it has reached a tentative
settlement agreement with plaintiffs in a class action suit regarding
siding that it sold under the names Abitibi lap or panel siding and/or
ABTco lap or panel siding. ABTco has entered into this agreement with
the primary goal of servicing its customers' concerns quickly and
appropriately. A key provision of the settlement is a program to allow
eligible claimants to recover the costs of repair or replacement of
damaged hardboard siding.

"The program reflects the confidence of ABTco that its siding products
will perform," said Joe Kastelic, president of ABTco Building Products.
"If the product fails to perform, the purchasers will be compensated for
repairs or replacement of damaged product, including both labor and
materials, subject to agreed upon exclusions and deductions."

The Court has preliminarily approved the settlement; and it will hold a
formal hearing on September 21, 2000 at 10:00 a.m. to consider whether
the settlement should be given final approval as fair, reasonable and
adequate. Class members who do not wish to participate in the settlement
may opt-out by notifying class counsel and the notice administrator by
July 31, 2000. "Even though the overwhelming majority of product is
performing, the settlement represents a statement of confidence that
ABTco can and will stand behind all siding products that the company has
sold," said Kastelic.

Homeowners, who believe they have damaged Abitibi/ABTco siding, or who
have questions concerning the program details, are encouraged to contact
the Abitibi/ABTco Customer Support Office at 800-549-4465. Customers can
also visit the website at http://www.abtcoclaims.com(The News and
Observer (Raleigh, NC), May 15, 2000)


ACCELR8 TECHNOLOGY: Rabin & Peckel Files Securities Lawsuit in Colorado
-----------------------------------------------------------------------
The law firm of Rabin & Peckel LLP announces that a class action has
been commenced in the United States District Court for the District of
Colorado, on behalf of all persons or entities who purchased or
otherwise acquired Accelr8 Technology Corporation common stock during
the period from September 15, 1997 through November 16, 1999, inclusive
(the "Class Period").

The Complaint alleges that Accelr8, Thomas V. Geimer, and Harry J.
Fleury violated section 10(b) of the Securities Exchange Act of 1934. In
particular, it is alleged that defendants, among other things,
materially overstated the Company's revenue, improperly recognized
revenue relating to licensing and maintenance fees, failed to amortize
capitalized software development costs, and failed to disclose that
Accelr8's Navig8 2000 software, created to fix the millennium bug, was
not available as a general Year 2000 remediation tool to the total
universe of the programs that need Year 2000 solutions as represented
during the Class Period. The Complaint alleges that, as a result of
these material misstatements and omissions, Accelr8's stock price was
artificially inflated throughout the Class Period.

Contact: Rabin & Peckel LLP, New York Joseph V. McBride, 800/497-8076 or
212/682-1818 email@rabinlaw.com


DENNY'S RESTAURANTS: Suit Claims Company Exploit Managers
---------------------------------------------------------
Denny's restaurants in Washington state routinely were understaffed,
forcing managers to cook and do other non-managerial work without
receiving overtime pay, a lawsuit alleges. The South Carolina-based
company denies the claim. The suit, filed May 1 in King County Superior
Court, said Denny's deliberately misclassified salaried employees as
managers to make them exempt from overtime. It claims managers spent
more than 40 percent of their time on non-managerial duties such as
cooking, cleaning, serving and cashiering. Denny's is owned by Advantica
Restaurant Group Inc. of Spartanburg, S.C.

"We are very confident that when all the facts of the case are
presented, Denny's compensation system, which is standard in the retail
and restaurant industries, will be deemed to be in complete compliance
with the law," the company said.

The suit was filed on behalf of Robert Husted of Port Orchard, who said
he worked an average of 58 to 65 hours per week as a Denny's manager and
as long as four weeks without a day off. It was filed as a proposed
class action by Seattle lawyer Steve Berman, and it invites anyone who
worked as a Denny's manager in Washington after Jan. 1, 1994, to join.
(The Associated Press., May 12, 2000)


EAST PALO: City to Repay Property Owners Excise Tax, Judge Rules
----------------------------------------------------------------
A San Mateo County judge has made it official: East Palo Alto will give
back to 2,000 property owners some $4.5 million over the next seven
years for improper collection of an illegal tax. A previous court ruled
that the levy, a flat fee based on the type of property owned, was
illegal because it was technically a property tax that required
two-thirds approval of the voters. Property owners, represented by
attorney Tony Tanke, had contended in a 1994 lawsuit that a so-called
excise tax used to provide police services was illegal.

The city agreed to the repayment plan and San Mateo County officials
agreed to guarantee the payments if the city falls short, according to
East Palo Alto City Attorney Michael Lawson.

During the past two years, retired Judge William Lanam acted as a
mediator to help hammer out terms of repayment. The agreement was then
formalized by Superior Court Judge Dale Hahn at a sparsely attended
hearing Friday. Of the $4.5 million, Tanke will receive $1.2 million.
The remainder will be paid to East Palo Alto property owners, who will
receive between $718 and $1,660 each, in a series of payments. The
amount varies depending on when they joined the class action suit. (The
San Francisco Chronicle, MAY 15, 2000)


FORD MOTOR: Supreme Ct Refuses Class Status over Peeling Paint on Truck
-----------------------------------------------------------------------
The Texas Supreme Court has denied class action status to a lawsuit
brought against Ford Motor Co. by truck owners who complained of peeling
paint on their vehicles.

Seven individuals who bought Ford trucks in Texas between 1987 and 1990
say the problem stemmed from Ford not using spray primer when the cars
were painted at the factory. All of the vehicle owners reported noticing
peeling and flaking problems between as soon as nine months after
purchase and up to four years afterward.

Ford attorneys said the cases should be considered individually because
there are too many potential differences between each to be certified as
one class.

Although already approved by two lower courts, the state Supreme Court
said the class of plaintiffs was faulty and ordered the case sent back
to the trial court, said Supreme Court spokesman Osler McCarthy. The
trial court could recertify a new class if the plaintiffs seek one out,
McCarthy said.

The lawsuit sought to include people who claimed past or present paint
peeling and flaking due to defective paint process on new Ford F-Series
Trucks between 1987 and 1993; 1987-89 Broncos; 1987-92 Rangers; or
1987-89 Mustangs; 1984-88 F-Series Trucks, 1984-88 Broncos and Bronco
IIs, 1984-88 Rangers or 1984-88 Mustangs and who paid Ford or a Ford
dealer for paint repair. (The Associated Press, May 11, 2000)


GIO: AMP Takes Issue with Press Report; Stays Clear of Takeover Lawsuit
-----------------------------------------------------------------------
Finance and insurance major AMP Ltd on May 15 took issue with a media
report which suggested AMP was a party to class action over the GIO
takeover. AMP Ltd said the article, published in the Sydney Morning
Herald on May 13, and headlined "Green light for 33,000 to take on AMP
giant" was misleading. The article concerned the GIO class action
hearing currently before the Federal Court and began: "A judge has
cleared the way for 33,000 aggrieved GIO shareholders to mount a joint
damages case against AMP the biggest class action in Australian legal
history". AMP Ltd said AMP Ltd subsidiary GIO Holdings Australia,
together with GIO's former directors and adviser Grant Samuel, were
party to the class action. "AMP is not party to and has not initiated
any legal action regarding the GIO takeover," the company said. (AAP
Newsfeed, May 15, 2000)


GIO: Lawsuits over AMP Takeover to Proceed
------------------------------------------
Insurer GIO Australia Holdings Ltd, its adviser and nine former
directors failed to stop a class action against them over the hostile
AMP takeover. Justice Michael Moore dismissed on May 12 the applications
to strike out the action, which were made by GIO, consultants Grant
Samuel & Associates Pty Ltd, David Mortimer, Bruce Hogan, Stewart
Steffey, Ronald Ashton, Marina Darling, Andrew Kaldor, Lloyd Lance,
David O'Halloran and Ian Pollard. The class action involves GIO
shareholders.

In asking the Federal Court judge to strike out the action, the
respondents claimed that under the relevant Act all group members of an
action must have a claim against each respondent. Further, some argued
that the claim against each respondent must be the same claim,
submitting that in this case there was not a claim by all group members
against each respondent. They cited the recent class action against
tobacco manufacturers which was thrown out by the Federal Court, with
the judges acknowledging the case could proceed on an individual basis.
But Justice Moore said that case was far removed from the GIO action and
found that the respondents had not shown that the action did not satisfy
the court's procedural requirements. The matter for put over to May 22
for directions. (AAP Newsfeed, May 12, 2000)


HMOs: Clinton, Gop Negotiate Patients' Rights Bill, Seek Deal On Rules
----------------------------------------------------------------------
In a private White House meeting last week, House Speaker Dennis Hastert
told President Clinton he favors HMO legislation that would extend new
rights to all Americans with insurance, rather than a more limited
series of protections in a Senate-passed bill, according to Republican
sources. These GOP sources, insisting on anonymity, said the Illinois
Republican also asked the president for his assistance in shaping a
final compromise that limits any right to sue insurance companies.

A senior White House official said Clinton told the speaker that he
would insist on legislation that covers all Americans and that the issue
was nearly non-negotiable. The president said that as long as the bill
contains a way to enforce a patient's rights, the White House is "open
to talk about how it is enforced," the official said.

Their meeting occurred the night before a larger session Clinton
convened Thursday with key congressional negotiators on a patients' bill
of rights. Clinton said that discussion was designed "to determine what
the issues are and what the processes are to resolve them."

In a statement issued after the meeting was under way, Hastert said, "We
are very close to completing a balanced bill, one that will address the
issue of the uninsured as it addresses the issue of accountability."

Despite Hastert's optimistic statement, progress toward a compromise on
the health maintenance organization legislation has been fitful. That is
partly due to the election-year gulf between Democrats and Republicans
and partly to the internal differences among lawmakers of the same party
in different houses.

As an example, GOP sources say House Republicans recently forwarded a
confidential memo to Senate GOP negotiators that outlined a proposal
granting the right to sue the "designated decision-maker" in federal
court for wrongful denial of care. Suits could be brought for
compensatory damages as well as economic damages, and punitive damages
would be permitted under some circumstances. No class action suits would
be permitted. The House-passed measure would lift the ban on lawsuits
for Americans in health plans that fall under federal regulation. The
Senate bill contains no new rights to sue.

Republican negotiators are expected to meet this week, and a bipartisan
bargaining session is also possible. Democrats, including Sen. Edward
Kennedy (D-Mass.), sought in the White House meeting to push Republicans
to agree to a timetable for resolving key issues. Republicans declined.
"We have spent hundreds of hours to put together a bill," Sen. Don
Nickles (R-Okla.) said after the meeting. "We have made good progress
despite what some may think."

Thus far, negotiators have agreed on a variety of relatively minor
points. They appeared on the verge of an accord several weeks ago on an
appeals process for patients who believe they were wrongly denied care,
but there has been no deal yet. Nor have they discussed the issue of how
wide-ranging the coverage should be, or on what, if any, right to give
patients to bring lawsuits.

In the House, where a coalition of Democrats and Republican
outmaneuvered the GOP leadership, the legislation would cover all
Americans with private insurance. Many of the Senate provisions would
cover a smaller group of 48 million Americans in plans regulated only by
federal law.

In addition, Republicans are expected to press Democrats this week to
address issues of access to insurance, including tax benefits designed
to make insurance more affordable, and allow for more medical savings
accounts. (Chicago Tribune, May 15, 2000)


HOLOCAUST VICTIMS: Easton and Levy Sues Swiss National Bank in CA
-----------------------------------------------------------------
Plaintiffs in Alperin vs. Vatican Bank, a class action lawsuit filed for
Jewish, Serb and Ukrainian Holocaust survivors seeking restitution of
the Word War II Croatian-Nazi treasury by Easton and Levy, have named
the Swiss National Bank and other as yet unnamed Swiss Banks in a motion
filed May 3, 2000 in United States District Court for the Northern
District of California, San Francisco, Case No. C99-49941 MMC.

A 1998 U.S. State Department report implicated both the Vatican and
Swiss National Bank in the disappearance of hundreds of millions of
dollars of gold, silver, and money looted by the 1941-1945 Croatian
regime known as the Ustashe from Serbs, Jews, and others. Plaintiffs
originally filed suit in November 1999 and later obtained wartime and
postwar U.S. government documents under the Freedom of Information Act
that indicated the involvement of Swiss banks in concealing and
transferring stolen gold and money between 1944 and 1952 including cash
transfers to war criminals in Argentina.

The allegation filed May 3 reads:

    United States OSS documents as early as 1944 indicate 500 kilograms
    of gold were deposited by the Croatians in the Swiss National Bank
    along with 2.5 million francs. A 1946 United Treasury Department
    report estimates 12 to 16 million francs in gold deposits were still

    controlled by the Ustashi in Swiss bank accounts. A 1949 CIA
    document alleges that of 1945, the Ustashi had holdings of 2.5
    million Swiss francs, 1,700 kilograms of gold, and 40,000 kilograms
    of silver in Swiss accounts. A 1948 U.S. Army Intelligence reports
    confirmed that 2,400 kilos of Ustashi stolen gold were moved from
    the Vatican to one of the Vatican's secret Swiss bank accounts.
    Finally, a 1952 CIA document indicates Pavelic, the Ustashi leader,
    transferred 5 million Swiss francs from Switzerland to Argentina."

However, no Swiss bank has yet been named as a defendant. Plaintiffs'
attorneys have requested clarification from counsel in the recently
settled 1.25 billion dollar Swiss Bank Holocaust class action which
released Swiss banks from liability for World War II era dealings with
the Nazis. Plaintiffs however contend that postwar deposits, possibly
from the Vatican Bank to Swiss Banks may be outside the scope of the
settlement.

Contact: J. H. Levy of Attorney Easton and Levy, 513-528-0586, or
e-mail, advocate@mailandnews.com.


HOLOCAUST VICTIMS: US Lawyers Accuse Austrian Law of Discrimination
-------------------------------------------------------------------
American lawyers criticized a proposed Austrian law to compensate those
forced to labor under the Nazi regime, saying Monday that the draft
legislation discriminates against Jews.

The proposed law would block former slave laborers held in concentration
camps from receiving money from Austria if they already were compensated
by Germany. Forced laborers not held in concentration camps most of them
non-Jewish Eastern Europeans however, would be eligible for payments
from both countries. Since the vast majority of concentration camp
inmates were Jewish, the draft would discriminate against them, the
lawyers say. ''The very people who were targeted for Nazi extermination
are the very ones who are limited in what they can claim and where they
can claim it from,'' said Ed Fagan, a New York lawyer who represents
Nazi victims now living in the United States.

Germany has agreed to compensate all former concentration camp inmates
regardless of where in Europe they were held. This would mean that an
inmate from a camp in present-day Austria would be eligible for German
compensation.

The U.S. lawyers further criticized Austria for not allowing a
representative of any Jewish organizations to attend a conference on
establishing the restitution fund, which begins Tuesday. Representatives
from six Eastern European governments including Poland, Russia and
Ukraine, are attending on behalf of the former forced and slave
laborers.

U.S. lawyers representing former victims who have filed a class action
lawsuit against Austria have also been excluded from the conference.

The proposed law would establish a fund to make one-time payments to
former slave and forced laborers of the Nazi regime. Although it doesn't
discuss payments, they are expected to range from 35,000-100,000
Austrian schillings ( dlrs 2,300-dlrs 6,600) per victim.

''Austria is still trying to put the blame for the concentration camps
on Germany,'' said Cary D'Avino, a New York-based lawyer involved
restitution. The wording of the bill and the amount of compensation were
still to be settled, and it was unclear when the legislation would come
up for a vote.

Also Monday, German lawmakers assured Polish officials that pledges for
a 10 billion mark ($ 4.6 billion) compensation fund for Nazi-era forced
and slave labor victims would be available on time. German media had
reported that the private sector would not be able to raise the entire
amount it was supposed to contribute. ''We are sure that when the bill
takes effect, the money will be in the bank,'' said group leader Bernd
Reuter of Germany's governing Social Democrats. (AP Worldstream, May 15,
2000)


INMATES LITIGATION: Ct Says Pretrial Detainee with AIDS Deserves Trial
----------------------------------------------------------------------
A pretrial detainee with AIDS has a right to a trial on his allegation
that the county jail interrupted his antiretroviral medications,
producing drug resistance that rendered the regimen ineffective, a
federal appeals court said.

A three-judge panel of the 9th U.S. Circuit Court of Appeals reversed a
lower court that had granted summary judgment to Pierce County, Wash.,
in a lawsuit alleging that county jail officials were deliberately
indifferent to the serious medical needs of the prisoner.

The case is significant in that it is the first time that a federal
appeals court has ruled that corrections officials are potentially
liable for suspensions in HIV treatment that are not medically
appropriate. That could put plenty of facilities in legal jeopardy. A
survey conducted last year found that roughly one-third of prison and
jail inmates were receiving antiretroviral treatments that don't meet
recognized national guidelines.

Unfortunately for attorneys representing inmates, the memorandum opinion
issued by the 9th Circuit was unpublished, meaning that its precedential
value is limited.

The case was brought by Robert M. Sullivan, who was in the late stages
of AIDS when he landed in Pierce County Jail on an outstanding bench
warrant. He immediately told jail personnel that he needed to continue
taking a combination drug therapy that included the protease inhibitor
Invirase, commonly known as saquinavir. For two days, Sullivan went
without medication. As a result, his viral load skyrocketed and the drug
combination lost its effectiveness.

Sullivan sued the county, the jail administrator and several members of
the medical staff on Section 1983 allegations that they had deprived him
of his Eighth Amendment right to be free of cruel and unusual punishment
through their deliberate indifference. A District Court judge granted
summary judgment to the defendants. The 9th Circuit panel overturned the
decision and sent the case back for further proceedings.

Deposition testimony produced by Sullivan showed that jail medical
personnel were aware of the possibility of treatment failure in the
event of an interruption in therapy. They also knew that the jail did
not stock the drug, and that they had the authority to release him on
that basis. The jail could have obtained the drug from a commercial
pharmacy. Instead, Sullivan remained incarcerated without medication.
The medical staff had the authority to ask that Sullivan's family bring
the medicines to him, but personnel took no action for two days.

Based on the evidence Sullivan supplied, the 9th Circuit said there were
sufficient facts for a jury to decide whether the defendants were
deliberately indifferent to the detainee's medical needs. This was not a
case, the court said, of differences of opinion as to the
appropriateness of medical care. The treatment Sullivan received "was
far from the medical norm," the court said. Likewise, testimony about
the rise in Sullivan's viral load following his incarceration created a
genuine dispute of material fact as to the question of harm resulting
from the interruption in the medication.

The 9th Circuit also reversed on the issue of qualified immunity, citing
precedent to show that "prison officials who deliberately ignore the
serious medical needs of inmates cannot claim that it was not apparent
to a reasonable person that such actions violated the law."

Finally, Pierce County was back on the hook for municipal liability.
Evidence existed that the county had a policy of providing inadequate
medical treatment to those in its custody. The court pointed to a
class-action settlement of lawsuit in which county officials, including
some of the defendants, stipulated that their medical care had violated
inmates' constitutional rights. Sullivan v. County of Pierce, No.
98-35399 (9th Cir., 4/21/00). (AIDS Policy and Law, May 12, 2000)


IRS: Minority Women Begin Legal Battle in Houston
-------------------------------------------------
Seven minority women have filed a complaint with the IRS equal
employment opportunity office in Houston, Texas, alleging they were
denied upward mobility opportunities and subjected to retaliation for
complaining about it. The National Treasury Employees Union may also be
named in an eventual suit. The women have contacted a lawyer who
recently settled another case involving IRS' Houston office. Carabeth
Luckey, a Texas attorney, told FEA she would most likely represent the
women. Anticipating a court battle, she was reluctant to talk "in depth"
about the case.

"I believe the facts are going to speak for themselves," Luckey said.
"These employees were not upgraded as they should have been because of
the agency's pattern of discrimination against minorities." Based on her
past experience with the IRS, Luckey "seriously doubted" the possibility
of working out an early resolution with the agency. She said she
recently obtained a "monetary settlement" in a similar case, but would
not comment further on it.

The pending complaint was filed with the IRS EEO office and is now under
investigation. The women must go through a series of administrative
procedures before they can take the case to court, including being
certified as a "class" by the Equal Employment Opportunity Commission.
If it reaches that stage, other employees who have similar claims of
discrimination could join the suit.

                            NTEU blamed

Vera Robinson, a Houston bankruptcy specialist, said initiating an EEO
class action was a last resort measure she took after complaining
repeatedly to agency officials and waiting two years for her union to
intervene. "NTEU did not properly represent us," Robinson said. "They
denied us the right to arbitrate our case." Robinson said NTEU would
also be named in the discrimination suit. She blamed the union for some
of the alleged retaliation she and her co-workers experienced on the
job, claiming that information got back to their supervisors that was
reported only to local union officials.

Eddie Wariner, union president for the NTEU's Houston district, declined
to comment on the case, saying an IRS spokesman, Henry Holmes, would
speak on behalf of the union instead. Holmes said it would be "entirely
inappropriate" to address a "specific situation like this. We have
avenues to address employee concerns, and that's where issues like this,
from our perspective, should remain," he said.

Last month, NTEU President Colleen Kelley denied allegations by the
NAACP that the union is insensitive when it comes to discrimination
issues. The NAACP charged in a report that the NTEU has "refused" to
represent cases related to racial discrimination and has directed
employees to the "corrupt" EEO process within the IRS instead. In a
letter to NAACP leader Kweisi Mfume, Kelley said she was "troubled" by
the fact no one contacted her about the allegations. "It feels like we
have been prejudged, which I would have considered to be the last thing
an organization such as the NAACP would do," Kelley said.

The report, entitled Employment Discrimination in the Federal Sector,
was prepared by the NAACP's federal task force. It was part of an
ongoing study of discrimination problems within a number of agencies,
including the IRS. The report charges that NTEU has "inadequately"
monitored, managed and documented grievances related to discrimination.
In her letter, Kelley said she had never heard, until the report, any
allegation that the union turns away valid grievances."When the drafters
of your report say that we have inadequately monitored the impact of the
employment situation on minorities, they are speaking with a great deal
of ignorance," she wrote. "It is simply unfair to make accusations when
one has not done even basic research to ensure accuracy, not given the
accused a chance to respond and not approached the report with an open
mind."

Kelley also took issue with parts of the report that attack the IRS. The
report said that "not much had changed" in the IRS with respect to civil
rights, despite recent reform initiatives. "When the NAACP has inquired
into numerous allegations, carefully worded, dubious responses are
received primarily from the agency's director, describing the agency's
commitment to EEO, yet attacking the credibility of the employee raising
concerns," the report said.

Kelley told Mfume that while NTEU has had "some very vigorous" civil
rights disputes with the IRS over the years, the union was pleased with
the current EEO director, Charles Fowler. "Mr. Fowler is knowledgeable,
aggressive and very successful at attracting very capable people to work
with him on EEO problems," she said in the letter. Fowler has also sent
a letter to the NAACP, claiming that there are "glaring inaccuracies and
misstatements in the task force report."

Kelly asked Mfume how widely and to whom the report was circulated. "If
possible, I would like to correct the record with all the audiences of
the report."

                  Task force 'not intimidated'

Leroy Warren, chairman of the NAACP's federal task force, said he was
not intimidated by Kelley's letter. He added that the NAACP will not
back down from charges made in the report. "A lot of employees tell us
that the union officials are in bed with management, and they don't have
a lot of faith in the union," he told FEA. "These people aren't crazy.
They're paying their dues, and they want representation." Warren said
the "tone" of Kelley's letter indicated that she was "representing" the
IRS instead of union members.

The task force has been reluctant to name sources because many of them
are afraid to come forward, he said. According to the task force report,
"retaliation" is almost double that of any category of EEO charges filed
against the IRS. "When employees raise their concerns through the EEO
process or other grievance proceedings, they suffer retaliation by
management officials at several levels of the agency," the report said.
(Federal EEO Advisor, May 10, 2000)


NOVARTIS AG: Faces U.S. Lawsuit Alleging Over-Promotion of Ritalin
------------------------------------------------------------------
A Dallas law firm has filed a lawsuit alleging that Novartis AG
fraudulently overpromoted the medicine Ritalin as a treatment for
attention-deficit-hyperactivity disorder, the Wall Street Journal Europe
reported, citing the filed suit.

Novartis said in a written statement Friday the allegations in the
lawsuit "are without merit" and vowed to fight the suit "vigorously",
the paper said. Novartis added: "Ritalin has been used safely and
effectively in the treatment of millions of
(attention-deficit-hyperactivity disorder) patients for over 40 years
and is the most studied drug prescribed for the disorder, with over 170
studies completed in more than 6,000 school-aged children."

The lawyers who filed the suit predicted similar actions would soon be
filed by other groups of plaintiffs. The law firm seeks class-action
status on behalf of people who bought Ritalin for their children, the
paper said. The suit seeks unspecified compensatory damages to reimburse
the cost of Ritalin purchases as well as unspecified punitive damages.

The American Psychiatric Association also is named as defendants in the
suit, the paper reported.

The suit alleges Novartis failed to disclose adequately a wide range of
side effects of Ritalin, known generically as methylphenidate
hydrochloride, including cardiovascular and central-nervous-system
problems. In addition to money damages, the suit seeks an order forcing
the defendants to disclose these side effects. (AFX European Focus, May
15, 2000)


REDDI BRAKE: Settlement Deal for '97 Securities Suit Remains Pending
--------------------------------------------------------------------
On  November  6,  1997, a class action lawsuit (McCormick, et al., v.
Reddi Brake Supply Corporation., et al.) was  filed  in  the  Los
Angeles County Superior Court on behalf of all persons or entities  who
bought  common stock of the defendant prior to March 23,  1996,  and/or
who  bought  or  sold  any  shares thereafter until  August  13,  1996,
excluding  defendants, their families, employees,  agents  or  assigns.
The complaint asserts causes of action for breach of fiduciary duty  by
officers  and director and conspiracy to manipulate  the price  of  the
common  stock of the defendant.  The Reddi Brake Defendants has  denied
the   claims   plaintiffs  in  the  litigation.   The  parties  to  the
litigation have entered into a Stipulation of Settlement dated May  21,
1999,  dismissing  the litigation with prejudice.  The  Stipulation  of
Settlement provides that the Plaintiffs will release the Company from a
$20  million judgement if the Company and individual defendants  assign
any and all rights for insurance coverage to the Plaintiffs.  As of the
date of this report, the settlement offer remains pending.


SARA LEE: Judge OKs Settlement for Recalled Hot Dogs and Meat Products
----------------------------------------------------------------------
Judge Jennifer Duncan-Brice entered an order preliminarily approving the
settlement agreement of the nationwide class action lawsuit filed by
Lead Class Counsel, Kenneth B. Moll & Associates, Ltd. involving Sara
Lee's recall of hot dogs and numerous other meat products in 1998.

     Class Members: all individuals who (1) between July 1, 1998 and
March 1, 1999 consumed Sara Lee Products bearing establishment numbers
6911 or P261, and (2) as a result became ill with Gastroenteritis due to
Listeria or Listeriosis at some time between July 1, 1998 and April 1,
1999.

    Symptoms From Listeria Or Listeriosis: 3 of the following symptoms:
nausea, vomiting, diarrhea, body aches, headache, weakness, exhaustion,
lethargy, or anorexia.

    Individual Payments: up to $50,000. TOTAL PAYOUT: Sara Lee's total
payout depends upon how many claims are filed. Statistics show that more
than 40 million Americans eat hot dogs and many of which are made by
Sara Lee, including Ball Park Franks. There were almost 2,000 reported
persons who became ill with listeriosis during 1998 alone. Under just 1
of the 4 payment categories, Sara Lee has agreed to pay $50,000 for each
case of Listeriosis which lasted more than 4 days. In a Press Release,
Sara Lee indicated that it believes the total costs under the settlement
will not exceed $5 million. However, based upon the number of claimants
who come forward, Sara Lee's estimate could prove to be only a fraction
of the ultimate settlement fund.

   Death: Although Sara Lee continues to deny liability, the Centers for
Disease Control and Prevention (CDC), reported that 21 deaths in over 22
States were caused by contaminated hot dogs and other meat products
manufactured by Sara Lee. Following the biggest recall in U.S. history,
Kenneth B. Moll & Associates, Ltd. filed several wrongful death cases
against Sara Lee.

    Food Research Institute: Under the terms of the Settlement
agreement, Sara Lee must donate money to the Food Research Institute,
University of Wisconsin-Madison, to be used for research on the
prevention of Listeria in food products.

Contact: Kenneth B. Moll & Associates, Ltd. Kenneth B. Moll,
312/558-6444


SURGUTNEFTEGAZ: Bernstein Liebhard Investigates on Dividend Payment
-------------------------------------------------------------------
The law firm of Bernstein Liebhard & Lifshitz, LLP has been consulted by
stockholders of Surgutneftegaz (OTC Bulletin Board: ASGTY), one of the
largest Russian natural gas companies, to investigate possible
irregularities by Surgutneftegaz in connection with the calculation and
payment of prior and future dividends on its preferred stock. Preferred
shares of Surgutneftegaz are traded in the United States as American
Depositary Receipts (ADRs).

Contact: Stanley D. Bernstein, Esq., or Jeffrey M. Haber, Esq., both of
Bernstein Liebhard & Lifshitz, LLP, 800-217-1522 or 212-779-1414
Surgut@BernLieb.com


TOBACCO LITIGATION: Industry Declines Negotiations to End Battles
-----------------------------------------------------------------
A federal judges proposal for negotiations aimed at a global tobacco
settlement has been rejected by the major U.S. cigarette manufacturers.

In letters to Brooklyn, N.Y., judge Jack B. Weinstein, and in a
closed-door meeting in his chambers on April 28, industry lawyers
declined, courteously but firmly, to negotiate.
    [W]e do not believe that creating a structure for the settlement
    negotiations ... can lead to the ultimate close of the tobacco
    litigation, Gary Long, of Kansas City, Mo.s Shook Hardy & Bacon,
    wrote on April 26 on behalf of Philip Morris Inc. and Lorillard
    Tobacco Co.

And in a closed-door meeting held in Weinsteins chambers two days later,
tobacco lawyers reiterated their refusal to discuss settlement.

According to several of more than two dozen plaintiffs and defense
lawyers who were present, tobacco lawyers offered three main reasons
they believed talks would be fruitless. The tobacco lawyers claimed that
the cases in front of Weinstein are legally and factually weak. They
dont believe that a global settlement can be constructed to satisfy
recent, restrictive decisions by the U.S. Supreme Court on class
actions. Their clients feared that settlement talks would trigger new
lawsuits by plaintiffs eager for a piece of any settlement pie.

For his part, Weinstein said that he believed a settlement could get
around the obstacles set up by the Supreme Court. He repeated his desire
to help the parties put the tobacco wars behind them and reminded the
lawyers that he has the power to halt state-court lawsuits if necessary
to effectuate a settlement, according to two lawyers who attended.

One plaintiffs lawyer suggested that under the right circumstances, the
judge could use his power to halt a multibillion-dollar, statewide
smokers class action in Florida, which is moving toward a verdict on
punitive damages.

Assuming that the tobacco companies dont reverse course, they may be
trying cases in front of Weinstein through spring 2001, at least. He has
scheduled five of the tobacco cases for trial, one after another,
beginning in July.

First up, on July 5, is Falise v. American Tobacco Co. Filed by trustees
for a fund created from the Johns-Manville Corp. bankruptcy, the case
seeks to recover part of the money the trust paid to people injured by
asbestos who were also smokers.

Writing that the time for bringing a close to tobacco litigation is
nigh, Weinstein on April 18 ordered eight tobacco cases filed in his
court to be consolidated for purposes of settlement negotiations. In
addition, he suggested that one of the cases, a nationwide class action
on behalf of lung cancer victims, could be broadened to provide a
vehicle for a national settlement. (Miami Daily Business Review, May 12,
2000)


TOBACCO LITIGATION: Industry to Fight Against Punitive Award in FL Case
-----------------------------------------------------------------------
A Florida jury that already found tobacco companies conspired to sell a
dangerous product will begin this week to consider a possible punitive
penalty. Anti-smoking activists are looking for a day of reckoning for
an industry that has yet to pay a penny to smokers who went to trial.

Big Tobacco plans to offer its 25-year settlement of $ 250 billion with
states and restrictions on youth marketing as proof that no more
punishment is needed in the landmark case brought by an estimated
500,000 sick Florida smokers and their families. But opponents expect
the nation's five biggest cigarette makers to pay billions more. "It
can't be hundreds [of billions] because it has to be nonbankrupting, but
I think the industry is worth roughly $ 100 billion, and I think a fair
punishment is a nice big hunk of that," said Dick Daynard, a
Northeastern University law professor who hopes for a verdict in the
tens of billions.

The class-action lawsuit against the companies was the first of its kind
to go to trial, and the punitive damages phase is important enough that
the industry's top executives plan to voluntarily testify - something
they rarely do.

"They have a good story to tell. The people running these companies now
are not the ones running the companies in the '50s when most of this
alleged wrongdoing occurred," said David Adelman, tobacco analyst with
Morgan Stanley Dean Witter. "They really and truly have reformed their
business practices."

Peter Jacobson, a University of Michigan associate professor of public
health who researches the role of courts in shaping health policy,
predicts a change in tone from the 1994 congressional testimony of
tobacco executives who denied that cigarettes are addictive in spite of
internal industry documents stating the opposite. He expects the CEOs in
this case to project a more conciliatory tone and sympathy for sick
smokers, warning that jurors would hold any evasiveness against them.

Now, the jury must decide whether to award punitive damages to punish
the companies for their conduct. Opening statements are expected Tuesday
and Wednesday. (The News and Observer (Raleigh, NC), May 15, 2000)


TOBACCO LITIGATION: Judge Kaye Delays Penalty Phase  in Lawsuit
---------------------------------------------------------------
The punitive phase of the first class-action suit to go to trial,
scheduled to begin Monday, has been postponed for a week to give Circuit
Judge Robert P. Kaye time to consider a 10-inch stack of motions. Awards
to 500,000 sick smokers could go into the billions and their attorneys
said they wanted to get started, but the tobacco industry's defense team
said they could use the time for more preparation.

Last month, the six-member jury awarded $12.7 million to three primary
plaintiffs in the case. Although estimates of total damages run to as
much as $300 billion, that is not likely to stick because Florida law
prevents damage and punitive awards from going so high they would put a
company out of business. The same jury ruled last July that cigarette
makers conspired to produce a dangerous product it knew could cause
illness. Juries have awarded damages to plaintiffs in six trials, but
because of appeals, the industry has yet to pay any of the awards.

The defendants are Phillip Morris Co., R.J. Reynolds Tobacco, Brown &
Williamson Tobacco, Lorillard Tobacco, the Liggett Group, the Council
for Tobacco Research and the Tobacco Institute. (United Press
International, May 15, 2000)


WORLD ONLINE: Defense Lawyers Will Answer Some Questions in June Mtg
--------------------------------------------------------------------
Lawyers representing World Online International NV, ABN Amro Holdings NV
and former World Online chairwoman Nina Brink declined to answer
plaintiffs' questions in a class action lawsuit by 1,000 shareholders
claiming to have lost out in World Online's initial public offering in
March. According to the attorneys, some of the information demanded by
plaintiffs' lawyer Bob van der Goen is share price sensitive, while some
of the 39 questions asked will be answered at an extraordinary
shareholders meeting of World Online, probably in June. The laywers said
a request for detailed information is not customary in a preliminary
class-action suit.

Van der Goen said he is not impressed by the defence arguments and added
he is "convinced" he will win the case, as the defence offered no
specific arguments against his allegations. "If you're truly innocent,
you deny the allegations," Van der Goen said, adding, "if I were
representing Nina Brink, I would have done it differently." A ruling is
set for Monday. (AFX European Focus, May 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

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

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