CAR_Public/000517.MBX                  C L A S S   A C T I O N   R E P O R T E R

                  Wednesday, May 17, 2000, Vol. 2, No. 96

                                 Headlines

A.B. DICK: Distributors File Suit over Trade Practice
BRK BRANDS: Announces Settlement for Smoke Alarm Suit in Alabama
COCA COLA: Plans $1 Bil Diversity Program for Women and Minorities
FEN-PHEN: 8 FL Women Opt to Sue AHP Individually
FEN-PHEN: MD Jury Seeks Documents on Side Effect Reporting System

GENERAL ELECTRIC: Residents Protest Housatonic River Superfund Cleanup
GENERAL MOTORS: Settles Brakes Lawsuit for $19M
HOLOCAUST VICTIMS: Austria Pressed for compensation at Conference
INTERIOR SECRETARY: Suit Seeks Release of Coal Mine Lands Funds
NATIONAL LAB: Settlement Reached for Lab Test Billing

NUTRAMAX PRODUCTS: Wolf Haldenstein Files Securities Suit in MA
NUCENTRIX BROADBAND: Customers Say They Are Overcharged for Late Fees
NUVEEN JOHN: 1996 Claim of Breach of Fiduciary Duty Pending in IL
NUCENTRIX BROADBAND: Customers Say They Are Overcharged for Late Fees
PASMINCO LTD: Aussi Miner Disappointed at New Legal Move on Emissions

SLOAN'S SUPERMARKET: NY Judge Lets Expert Testify on Acquisition Fraud
STATE BOARD: Judge to Rule on Indiana Property Tax System
TCC INDUSTRIES: Securities Suit Settlement Preliminarily Approved in CO
TOBACCO LITIGATIION: Judge Asked to Cap Punitive Before Jury Gets Case
TRANSCRYPT INTERNATIONAL: Concludes Legal Issues from Shareholder Suits

WORLD ONLINE: Founder Brink Admits Link to Five Failed Firms

* Troubles Seen in New SEC IOSCO Disclosure Standards

                           *********

A.B. DICK: Distributors File Suit over Trade Practice
-----------------------------------------------------
Paragon Corporate Holdings Inc. relates in its filing with the SEC that
on April 30, 1997, four former and current distributors of A.B.Dick
filed a suit against A.B.Dick, the Predecessor Company of Paragon
Corporate Holdings Inc., alleging, among other things, breach of
distributorship contracts and unfair and deceptive trade practices. The
plaintiffs allege that the former parent of A.B.Dick decided to exit the
U.S. market for printing equipment and related supplies and services by
the sale or closing of A.B.Dick and as part of such plan pursued
strategies designed to eliminate or significantly weaken A.B.Dick
distributors engaged under distributorship contracts during the four
year period ended April 30, 1997. The Company intends to vigorously
defend this case although there can be no assurance as to the eventual
outcome.


BRK BRANDS: Announces Settlement for Smoke Alarm Suit in Alabama
----------------------------------------------------------------
It was announced by BRK Brands, Inc. that last Friday, the Honorable
U.W. Clemon, of the United States District Court for the Northern
District of Alabama, granted preliminary approval of a class action
settlement in Claybrook v. BRK Brands, Inc., CV-98-C-1546-W.

The lawsuit arose out of claims that BRK Brands, Inc., which
manufactures and markets smoke alarms under the brand names First Alert,
Family Gard, Wake'n Warn, BRK Electronics or BRK Brands, allegedly
failed to adequately inform the public of the varying performance
characteristics of its ionization and photoelectric smoke alarms.

If the settlement receives final approval, BRK Brands, Inc. will
commence a nationwide print and broadcast Public Information Campaign to
further educate consumers, fire safety officials and retailers regarding
the varying characteristics of ionization and photoelectric smoke alarm
technology and other information concerning fire safety, including
instructions on the proper testing, installation and maintenance of
smoke alarms. BRK will also offer a $ 5.00 rebate on the purchase of its
First Alert Double/Dual Sensor Smoke Alarms, which utilize both
ionization and photoelectric technology in a single smoke alarm.

The proposed settlement will be considered for final approval at a
Fairness Hearing that will be held on September 19, 2000 in the Court.
Class members who wish to opt out from, comment on, or object to the
settlement must do so by August 11, 2000.


COCA COLA: Plans $1 Bil Diversity Program for Women and Minorities
---------------------------------------------------------------------
Coca-Cola was expected to announce that it will commit $ 1 billion over
the next five years to a major new initiative aimed at boosting
entrepreneurship and other business opportunities for minorities and
women. This latest effort to foster diversity and economic empowerment
in local communities throughout the country comes as the company deals
with a racial discrimination lawsuit by employees and a boycott to
pressure Coke to settle the claims.

But the program to be announced focuses on the company's relationship
with the outside world --- not on the internal issues raised by the
lawsuit. "The Coca-Cola Co. must continue to strengthen local economies
and communities through the way we invest, the way we allocate our
procurement dollars, the partners we choose to help us market and
distribute our brands, and the way we build our system," Chairman Doug
Daft says in a statement to be released.

Daft and other top executives believe the program will help the company
increase revenue over the long haul. "This is a business strategy," Carl
Ware, executive vice president of global public affairs, emphasized.
"It's not something that's tacked on because it's a nice thing to do,
although it is the right thing to do. It's a business strategy."

The initiative, which will nearly double the company's spending on such
diversity programs, has several parts, including:
    Increasing spending with minority and women-owned businesses by more

    than 50 percent over the next five years. Coca-Cola will spend an
    average of $ 160 million a year with such businesses, compared with
    about $ 100 million now. Over five years, that will total about $
    800 million, compared with about $ 500 million at the current rate.

    As an example, the company is establishing a new business
    relationship with Carolyn Hogan Baldwin, who will be resigning as
    president of Coca-Cola Financial Corp. Baldwin is setting up a
    separate firm, Global Tech Financial, which will manage the
    processing and servicing of loans and leases granted not only by
    Coke's financial corporation, but also by other financial
    institutions. Baldwin will become chairwoman and chief executive of
    the new company.

    Establishing a new supplier mentoring program among minorities and
    women to help develop and grow businesses that deal with Coca-Cola,
    from suppliers to those that provide services.

    Increasing economic partnerships and marketing investments in 50
    additional urban communities throughout the country. While the
    company has not publicly identified the communities, the program
    will be modeled after one in New York's Harlem area. Many of the
    communities are underserved by large retailers, so Coke tailors
    specific marketing and retailing initiatives to smaller
    entrepreneurs.

    Strengthening financial ties to firms owned by minorities or women.
    For example, Coke trustees recently doubled the portion of its
    employee pension fund managed by such firms to $ 115 million, from $

    56 million.

The company said it hopes to take similar steps to diversify its
insurance coverage and the underwriting of debt issues. It also wants to
increase its use of minority banks.

Spending $ 50 million over five years to support nonprofit
organizations. Funding would include scholarships for minority youths,
mentoring programs for youths, and support for community outreach and
advocacy groups. Coca-Cola also will establish a scholarship and
internship program in marketing and finance at selected historically
black colleges.

Coke's wide range of programs drew a positive reaction from one civil
rights leader who has urged the company to settle the discrimination
lawsuit. "I think it will be a model for corporate America in the new
century," said Joseph Lowery, president emeritus of the Southern
Christian Leadership Conference. "It deals with economic empowerment in
the minority communities, which is where advancement should come from. I
think we have to give the protesting employees credit for serving as a
catalyst for this new venture by Coke."

One of those protesters is former Coca-Cola human resources manager
Larry Jones, who is organizing a boycott of Coke products. "I'm
delighted to know that the Coca-Cola Co. has finally recognized the need
to include blacks in a very substantial way in the business," said
Jones, who was laid off in February after 15 years with the company.
"However, the issues that we are raising in this boycott, namely the
lawsuit, have not been addressed."

One of the plaintiffs' attorney in the discrimination lawsuit, Cyrus
Mehri, said Coke's "external investment is long overdue. However, the
internal issues remain for African-American employees who have suffered
a discriminatory regime for years."

Coke President Jack Stahl said the company is not establishing this
external diversity program in a vacuum. Instead, he said, Coke is taking
a " holistic approach" to diversity that he hopes will include internal
issues " down the road."

Currently, the company is in settlement talks over the discrimination
suit, with both sides prohibited from discussing the negotiations.

Eight former and current workers allege in their suit that Coca-Cola has
discriminated against African-Americans in pay, promotions and
performance evaluations. The suit seeks class-action status to represent
2,000 other black salaried employees in the United States. The company
has denied the allegations.

Daft and other top executives believe the program will help the company
increase revenue over the long haul. "This is a business strategy," Carl
Ware, executive vice president of global public affairs, emphasized.
"It's not something that's tacked on because it's a nice thing to do,
although it is the right thing to do. It's a business strategy." (The
Atlanta Journal and Constitution, May 16, 2000)


FEN-PHEN: 8 FL Women Opt to Sue AHP Individually
------------------------------------------------
Eight Florida women join hundreds of other people who are suing a
company that made part of fen-phen. Claiming they suffered permanent
heart and lung damage, eight women have filed suit in Pinellas County
against the manufacturer of one ingredient in the controversial diet
drug combination fen-phen. They are among 700 Florida residents who have
opted to sue American Home Products Corp. individually in Tampa Bay area
courts for punitive damages rather than join a proposed $ 3.75-billion
national settlement that is among the largest personal injury
settlements in U.S. history.

Tampa attorney Brenda Fulmer, who represents the eight women, said the
national settlement would not adequately compensate those who developed
lung problems and certain heart ailments from taking the diet drug. "A
huge group of people will get very little," Fulmer said. "The national
settlement is not appropriate for some individual claims."

The suits filed last Friday in Pinellas-Pasco Circuit Court allege
product liability, negligence, misrepresentation and fraud. Fulmer said
American Home and its subsidiaries should have adequately warned doctors
of the health problems associated with fen-phen. Fulmer said her firm,
Alley & Ingram, represents nearly 700 other Florida residents - women
and men of all ages - who plan to sue American Home in Pinellas and
Hillsborough counties.

About 6-million people took the mix of fenfluramine and phentermine,
known as fen-phen, after it came out in the mid-1990s. The drugs were
withdrawn from the market in September 1997 after a Mayo Clinic study
linked the combination to potentially fatal heart valve damage.

More than 11,000 lawsuits have been filed against American Home, which
makes fenfluramine - the "fen" in fen-phen. The Madison, N.J., company
sold the drug under the brand name of Pondimin and also made a similar
drug, Redux.

Though both drugs had been approved by the Food and Drug Administration,
their use in combination and for long periods had not been approved by
the agency. Some people who took the drugs developed heart valve
problems, elevated blood pressure in their lungs, or both. Fulmer said
five of her clients already have died from heart or lung problems
stemming from fen-phen use.

Douglas Petkus, a spokesman for American Home subsidiary Wyeth-Ayerst
Laboratories, said he was not aware of the latest round of lawsuits and
could not comment on pending litigation.

One of the plaintiffs, Helen Auer of Englewood, does not think she will
recoup the cost of her medical bills. Auer, who took diet drugs for
three months, said she suffers from a leaky heart valve. The other seven
women who recently filed suit could not be reached or declined to
comment.

The first Hillsborough trial is scheduled to begin in October.

American Home Products and attorneys who favor a national settlement
worked out a $ 3.75-billion deal in October. A judge gave preliminary
approval to the deal in November, and Petkus said approval is expected
in July. Under the settlement, the fen-phen users would get anywhere
from a few hundred dollars to $ 1.5-million, depending on their health
problems and how long they took the drugs.  Some 45,000 fen-phen users
have refused the multibillion-dollar settlement and retain the right to
sue for punitive damages; about 3,000 live in Florida. Lawsuits have
been or will be filed in Pensacola, Orlando and South Florida. Those who
are part of the class-action lawsuit may still reject the settlement and
sue for compensatory damages but cannot collect punitive damages.

In December, a Mississippi jury awarded $ 150-million in compensatory
damages to five people who said their health problems could be traced to
the drugs. (St. Petersburg Times, May 16, 2000)


FEN-PHEN: MD Jury Seeks Documents on Side Effect Reporting System
-----------------------------------------------------------------
American Home Products said a federal grand jury in Maryland was adding
to its problems by seeking documents regarding the company's system for
reporting side effects of its drugs, including its now-withdrawn diet
drugs. The subpoena filed with the Securities and Exchange Commission
comes at a time when diet drug litigation, related to serious
side-effects from a two-drug combination therapy used by almost 6m
people in the US, has already been hanging over AHP for months. It has
affected its share price and contributed to the break-up of three failed
attempts to merge with other pharmaceutical companies.

The company has offered Dollars 3.8bn to settle a class-action suit and
a federal judge, who has already given preliminary approval to the deal,
is to give a final ruling this summer. There had been fears too many
people would opt out of the settlement and start separate litigation but
so far only 45,000 people have opted out - not enough to derail it.

The company would not elaborate on the subpoena disclosure, saying only
it was responding and believed its conduct on diet drugs had been lawful
and appropriate. The Food and Drug Administration, which gives approval
for the sale of drugs in the US, requires companies not to withhold any
information on ill-effects. (Financial Times (London), May 16, 2000)


GENERAL ELECTRIC: Residents Protest Housatonic River Superfund Cleanup
----------------------------------------------------------------------
EPA may have to delay treatment of the Housatonic River Superfund site
in Pittsfield, Mass., while the agency, General Electric Co. (GE) and
residents sort through complaints over the cleanup remedy and litigation
continues.

Riverside property owners are trying to intervene in EPA's settlement
with GE through comments on the consent decree. But GE already is
beginning the remedy specified in the recent consent decree.

The consent decree does not assure them that GE will be responsible for
cleaning contamination discovered in the future, the residents said.
However, the residents agreed to a limited intervention, the agency
said. Thus, EPA will not change the consent decree, but officials still
must address the issue.

The consent decree requires cleanup of the first two miles of the river.
GE is using Maxymillian Technologies Inc. to dredge a half-mile of the
river closest to the GE plant. After that work is completed in May 2001,
the Army Corps of Engineers will clean another one-and-a-half miles.

EPA estimates the first two miles of the cleanup will cost $ 250
million. But since contamination spreads several miles downstream,
cleaning up the entire river could cost $ 750 million.

                     Issue Heads to Court

In a motion filed March 28, the property owners contend the consent
decree does not go far enough to remedy "decades of corporate neglect
and irresponsibility concerning [GE's] indiscriminate dumping and
disposal of hazardous waste."

The consent decree is "one of many events in the last 20 years of more
inaction than action," said Neil Glazer, the residents' attorney.

He calls the agreement a Band Aid because it does not fully address the
sources of polychlorinated biphenyls (PCB). The residents suspect other
contaminated locations throughout the watershed, Glazer said. They fear
GE may have dumped PCB material that may not have been discovered.

The residents want a remedial action plan rather than a series of
removal actions, what Glazer considers a piecemeal approach. He
acknowledged that an agreement on a comprehensive cleanup would take
longer to implement. But since EPA has taken 20 years to form an
agreement with GE, he said the residents would be willing to wait a few
more years for the assurance that it will be cleaned.

As it stands, the remedy does not address the watershed and thus leaves
the possibility open for future contamination during flooding, Glazer
said. And the residents are skeptical that GE would agree to clean the
same area over again.

"There aren't sufficient assurances that if [the residential] properties
are recontaminated, someone will come in and clean them up," Glazer
said.

Finally, the remedy GE is currently performing might not be permanent
enough, Glazer said. The company is dredging the river only to a limited
depth and then installing a cap, which Glazer considers an unproven
method.

                           EPA Denies Claims

GE already is required to clean all river-front residential properties
to a PCB level of 2 parts per million, said Bryan Olson, EPA's team
leader.

Every Superfund consent decree has a "reopener" that keeps responsible
parties liable for contamination discovered in the future, Olson said.
EPA feels it is in a much better position having an agreement than
having none at all.

The residents have a pending class action lawsuit against GE for
contaminating their properties. Olson said the property owners are
intervening in the consent decree because the agreement hurts their
chances to successfully sue GE themselves.

The accusation that EPA is employing a piecemeal approach is "just
ridiculous." If the agency could predict what would be discovered in the
future, then a consent decree would include all future work, he said.
"We'd be crazy to think we know everything about this river," Olson
said. Contacts: Bryan Olson, EPA, (617) 918-1365; Neil Glazer, attorney
for property owners, (215) 238-1700. (Hazardous Waste News, May 1, 2000)



GENERAL MOTORS: Settles Brakes Lawsuit for $19M
-----------------------------------------------
General Motors Corp. has agreed to a $19 million settlement for a class
action lawsuit that alleged the company installed defective brake parts
in sedans built from 1988 to 1993.

The New Jersey lawsuit claimed the rear brakes in the Chevrolet Lumina,
Pontiac Grand Prix, Oldsmobile Cutlass Supreme and Buick Regal were
prone to corrosion, causing costly brake repairs. The suit was
classified as a nationwide class action in November 1996. GM spokeswoman
Kelly Cusinato said the company built 2.6 million cars covered by the
settlement, but it was not known how many of those were still in
service.

Under the settlement GM disclosed in federal filings, the company will
pay eligible repair bills for owners and lessees of the cars. GM also
will notify owners and cover attorneys' fees.

GM said the New Jersey trial court had given preliminary approval to the
plan in March, and would hold a hearing for final approval. Cusinato
said the National Highway Traffic Safety Administration had studied the
complaints and determined there was no safety-related defect. (AP
Online, May 16, 2000)


HOLOCAUST VICTIMS: Austria Pressed for compensation at Conference
-----------------------------------------------------------------
International experts began a two-day conference Tuesday on Austria's
plans to compensate Nazi forced labour victims, a meeting attacked by a
key US lawyer as racist and discrimatory against Jews. The meeting was
called to discuss setting up a reconciliation fund for the victims of
Nazi forced labour policies in Austria, which was part of Hitler's Third
Reich from 1938 until the end of World War II.

US Deputy Treasury Secretary Stuart Eizenstat, responsible for Nazi
compensation issues, is among participants at the meeting, chaired by
Vienna's representative in charge of the dossier Maria Schaumayer.

Former forced labourers from Poland, Russia, Hungary, Ukraine,
then-Czechoslovakia and Belarus are also participating.

The meeting began after US lawyer Ed Fagan, who has led campaigns for
Nazi victim compensation notably in Germany, openly accused Austria of
"racism" over proposed legislation on the issue. He notably lamented
plans to create a difference between workers forced to come to work in
Austria during the war, who would be compensated by Vienna, and
Austrians deported to concentration camps by the Nazis, mostly Jews, who
could only receive compensation from Austria after having applied for
compensation in Germany. "This draft law is discriminatory. It
discriminates against the Jews -- enough is enough," he said, adding:
"This is racist."

Schaumayer rebuffed the criticism, saying she was "surprised at how
little Mr. Fagan knows about the subject," and insisting it was "very
difficult to see what is racist or discriminatory in this draft law."
Schaumayer said the draft outlined five forms of compensation: for
workers treated as slaves; workers in industrial plants; agricultural
labourers; deported children; and deported women who were pregnant.

Fagan last month filed an 18-billion-dollar (19.8-billion-euro) class
action suit seeking compensation both from Austrian companies and the
Austrian state itself for victims of forced labour policies and
confiscation of property from Jews.

The new Austrian government, which took office in February, has been
isolated by the European Union over its inclusion of the far-right
Freedom Party of Joerg Haider, known for controversial past Nazi-related
comments.

Both governing parties signed a preamble to their coalition deal vowing
to face up to the country's coresponsibility for Nazi atrocities.

Maria Rauch-Kallat, secretary-general of Austria's ruling conservative
People's Party, rejected Fagan's latest criticism, saying the
government's aim was to "make sure the money gets to the people
involved." The head of Austria's Jewish community, Ariel Muzicant,
called for rapid compensation for Austrian Jews who had property
confiscated by the Nazis. Some 70,000 apartments and 33,000 businesses
were seized, he said. The Austrian government, which has set up a
historical commission to study the confiscation issue, wants to deal
first with forced labour compensation.

The Vienna conference is also to discuss the overall amount of
compensation for victims of forced labour policies, estimated by
Schaumayer at 6 billion schillings (436 million euros, 395 million
dollars).

The historical commission estimates that about 1 million people were
forced to work by the Nazis between 1938-1945. Some 150,000 victims are
still alive, according to Schaumayer. (Agence France Presse, May 16,
2000)


INTERIOR SECRETARY: Suit Seeks Release of Coal Mine Lands Funds
---------------------------------------------------------------
A lawsuit filed Tuesday seeks a court order that the U.S. Department of
Interior release hundreds of millions of dollars in fees collected to
restore land abandoned after coal mining. The suit, filed in U.S.
District Court in Frankfort, asks that it be made into a class action to
cover all 23 states where money is collected from mining operations for
the Abandoned Mine Land Reclamation Fund. The suit said acid runoff from
abandoned mines fouls water in Kentucky, high walls and open shafts
present public hazards and abandoned mine property depresses the value
of other land.

Interior Secretary Bruce Babbitt is named as the defendant because the
suit claims he has not followed the law that at least half of the money
collected be returned to the states each year. The past due payments
exceed $1.3 billion, the suit said, including more than $97 million to
Kentucky.

A fee of 35 cents for each ton of coal removed from surface mines and 15
cents per ton from deep mines is collected for the fund.
The suit was filed on behalf of Coal Operators and Associates Inc., a
group of mining and mining-related companies based in Pikeville; Phelps
Coal and Land Co., also located in Pike County; and Roy Seagraves, a
Carter County resident who the suit claims has had his health and
welfare adversely affected by the department's refusal to distribute the
money.

A spokesman for the department said he had not seen the lawsuit and
could not comment. A spokesman for the department said he had not seen
the lawsuit and could not comment. (The Associated Press, May 16, 2000)


NATIONAL LAB: Settlement Reached for Lab Test Billing
-----------------------------------------------------
A proposed settlement has been reached in a national class action
lawsuit involving certain laboratory services provided by Damon, MetPath
and their affiliates, now part of Quest Diagnostics Incorporated (NYSE:
DGX) of Teterboro, New Jersey.

Under the terms of the proposed settlement, individuals and entities may
be entitled to recover payments made for certain laboratory tests
performed between January 1, 1988 and December 31, 1995. Individuals may
recover up to $7 for each laboratory testing profile that they paid for
containing one or more such tests. Entity claimants may recover a
certain percentage of actual payments made for each such test upon
documentary substantiation of their claim.

A settlement pool of $10 million has been earmarked to satisfy claims
under the terms of the settlement. Quest Diagnostics said that it had
anticipated the settlement and is adequately reserved for the cost of
the proposed settlement.

The Complaint, filed in March 1997 in U.S. District Court for the
Northern District of Alabama, asserted that Damon, MetPath and other
affiliated labs used various schemes to inappropriately bill or charge
for some testing services. In reaching the settlement, Quest Diagnostics
did not admit any wrongdoing by Damon or MetPath and their affiliates.
The Court has not ruled on the merits of the claims or the companies'
defenses. According to Quest Diagnostics, it entered into the settlement
in order to put the allegations behind it and avoid diverting resources
toward protracted and uncertain litigation.

To participate in the settlement, claimants must file a proof of claim
with all required supporting documentation by July 14, 2000. Putative
class members who wish to be excluded from the class may request
exclusion by submitting a written notice to the claims administrator no
later than June 12, 2000. Further information, including copies of claim
forms and information on how to opt out of the class, may be obtained by
writing to: Claims Administrator, In re Laboratory Test Litigation, Post
Office Box 40608, Portland, Oregon 97208-4260, by visiting the website:
www.labclaims.com, or by calling the claims administrator at
800-640-4260.

Judge U.W. Clemon, the U.S. District Court Judge presiding over the
class action, entered an order on April 4, 2000 preliminarily approving
the settlement and establishing a timetable for requesting exclusion
from the class, submitting claims and raising objections to the
settlement. A final hearing will be held on July 14, 2000. Class members
have a right to appear at the hearing and to be heard either in support
of, or in opposition to, the settlement.


NUTRAMAX PRODUCTS: Wolf Haldenstein Files Securities Suit in MA
---------------------------------------------------------------
On May 15, 2000, the law firm of Wolf Haldenstein Adler Freeman & Herz
LLP filed a class action lawsuit in the United States District Court for
the District of Massachusetts, on behalf of all persons who purchased
the stock of NutraMax Products, Inc. (OTC Bulletin Board: NMPC, NMPCE)
between January 20, 1998 and November 24, 1999 .

The complaint alleges violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 by the Company's former
Chief Executive Officer and former Chief Financial Officer. NutraMax
recently filed for bankruptcy and has not been named as a defendant. The
complaint alleges that from January 20, 1998 through November 24, 1999,
defendants issued materially false and misleading financial statements
and press releases concerning NutraMax's revenues, income and earnings
per share. The Company's financial statements made during the Class
Period, all of which implicitly and/or expressly were prepared in
conformity with generally accepted accounting principles ("GAAP"), were
materially false and misleading because the Company materially
overstated its revenues, income and earnings.

Contact: Schiffrin & Barroway, LLP, Philadelphia Marc A. Topaz, Esq.
Robert B. Weiser, Esq. 1-888-299-7706 (toll free) or 1-610-667-7706 Or
by e-mail at info@sbclasslaw.com


NUCENTRIX BROADBAND: Being Sued under Federal and State Securities Laws
-----------------------------------------------------------------------
Nucentrix Broadband Networks Inc. discloses in its SEC filing that
certain of the Company’s directors and officers, to whom the Company may
have indemnity obligations, are defendants in two securities lawsuits,
one of which is a purported class action lawsuit. These actions allege,
among other things, various violations of federal and state securities
laws.


NUCENTRIX BROADBAND: Customers Say They Are Overcharged for Late Fees
---------------------------------------------------------------------
Nucentrix Braodbank Networks Inc. is a party to two purported class
action lawsuits alleging that the Company overcharged its customers for
administrative late fees. The Company intends to vigorously defend these
matters. While it is not feasible to predict or determine the final
outcome of these proceedings or to estimate the amounts or potential
range of loss with respect to these matters, and while management does
not expect such an adverse outcome, management believes that an adverse
outcome in one or more of these proceedings that exceeds or otherwise is
excluded from applicable insurance coverage could have a material
adverse effect on the consolidated financial condition, results of
operations or cash flows of the Company.

In September 1999, two former stockholders of Heartland Wireless
Communications, Inc. filed a motion in U.S. Bankruptcy Court to revoke
the order confirming the Plan. The Company intends to vigorously oppose
the motion, and it is not possible at this time to predict the effect of
any action by the Bankruptcy Court to revoke the Plan.


NUVEEN JOHN: 1996 Claim of Breach of Fiduciary Duty Pending in IL
-----------------------------------------------------------------
A lawsuit brought in June, 1996 by certain shareholders is currently
pending in federal district court for the Northern District of Illinois
against John Nuveen & Co., Nuveen Advisory, six Nuveen investment
companies and two of the Funds' former directors seeking unspecified
damages, an injunction and other relief. The suit also seeks
certification of a defendant class consisting of all Nuveen-managed
leveraged funds.

The complaint is filed on behalf of a purported class of present and
former shareholders of all Nuveen leveraged investment companies,
including the Funds, which allegedly engaged in certain practices which
plaintiffs allege violated various provisions of the Investment Company
Act of 1940 and common law. Plaintiffs allege among other things,
breaches of fiduciary duty and various misrepresentations and omissions
in disclosures in connection with the use and maintenance of leverage
through the issuance and periodic auctioning of preferred stock and the
payment of management and brokerage fees to Nuveen Advisory and John
Nuveen & Co.

A similar complaint was filed by the Plaintiffs against another major
leveraged-fund sponsor and adviser. The Plaintiffs filed a motion to
certify a plaintiff class (which would include current and former
shareholders of all Nuveen leveraged closed-end funds).

On March 30, 1999, the court entered a memorandum opinion and order
granting the Defendants' motion to dismiss four of the Plaintiffs'
counts; denying the Defendants' motion to dismiss the remaining count
(breach of fiduciary duty under Sections 36(b) of the Investment Company
Act of 1940) as to Nuveen Advisory, and granting the same motion as to
the remaining Defendants; and denying the Plaintiffs' motion to certify
a plaintiff class and a defendant class. The remaining Defendant will
continue to vigorously contest this action.


PASMINCO LTD: Aussi Miner Disappointed at New Legal Move on Emissions
---------------------------------------------------------------------
Lead and zinc miner Pasminco Ltd was "not surprised" a class action
relating to emissions from two of its smelters had been moved to the
Victorian Supreme Court, the company said. "(But) we are disappointed
that again we are going to have to get involved in complex and expensive
legal actions to resolve issues that we would far prefer that we
resolved sitting down with the claimants," Pasminco spokesman Trevor
Shard said.

A negligence and nuisance claim was launched Monday in Victoria, just
days after the miner succeeded in having a case against it thrown out in
the Federal Court. More than 1,000 plaintiffs allege that lead emissions
from Pasminco smelters in New South Wales and South Australia have led
to health problems among residents in the towns of Cockle Creek and Port
Pirie. The Federal Court in Sydney dismissed the class action, saying
the matter could not be heard under the Trade Practices Act. The case
was instigated on behalf of Roslyn Cook and her daughter, Samantha, who
lived near Cockle Creek from 1989 to 1998.

The Company said ongoing legal action relating to emissions from two of
Pasminco's smelters was a distraction and nuisance but had not
materially affected earnings.

The renewed court action appeared to disturb the market, with Pasminco
shares marked down six cents to 94 cents on strong volumes in a
generally buoyant resource sector.

Lawyers Coleman & Greig said the smelter victims had been forced to take
their fight to Victoria, which was a 'last resort' to get Pasminco to
accept its community responsibilities. It said the victims were seeking
damages as well as an injunction to reign in the company's emissions.
"The (Federal) Court's ruling was based on a technicality about
jurisdiction, and does not take away from the fact that we have over
1,000 victims asking us to help them obtain justice," Paul Gambin from
Coleman & Greig said.

Ms Cook said she did not understand how Pasminco, which claimed to be a
community friendly company, had ignored the claimants for so long,
relying on a technicality to escape liability. But Mr Shard said none of
the claimants had actually approached the company over their concerns
about the smelters. "We said on Friday that the opportunity is there, we
certainly want to hear from people," he said. "We would far prefer to
deal with it that way than the route that Coleman & Greig has chosen,
which is to drag everybody through the courts, which we don't believe is
going to deliver anybody satisfaction." (AAP Newsfeed, May 16, 2000)


SLOAN'S SUPERMARKET: NY Judge Lets Expert Testify on Acquisition Fraud
----------------------------------------------------------------------
A federal judge in New York has admitted the testimony of an expert
witness who is expected to testify at trial that the owner of a chain of
supermarkets manipulated the price of stock in the company by falsely
announcing that it was expanding its operations. RMED International et
al. v. Sloan's Supermarkets Inc. et al., No. 94 Civ. 5587 (S.D.N.Y.,
Mar. 24, 2000).

U.S. Magistrate Judge Ronald L. Ellis found that the proposed testimony
of financial analyst Candace Preston passed the test for reliable
scientific evidence laid out in Daubert v. Merrell Dow Pharmaceuticals,
509 U.S. 579 (1993).

Preston will testify for the plaintiffs in a class action under Section
10(b) of the Securities and Exchange Act, in which the plaintiff
shareholders allege they were induced to purchase common stock in a
company at inflated prices in anticipation of a merger that never
happened.

                             Background

The class, represented in this suit by RMED, claims that defendant John
Catsimatidis -- the CEO, chairman and treasurer of Sloan's Supermarkets
and the president, CEO and sole shareholder of Red Apple Companies --
made false and misleading representations regarding Sloan's intention of
pursuing a growth strategy by acquiring additional supermarkets.
Catsimatidis also allegedly failed to disclose material facts regarding
a Federal Trade Commission antitrust investigation into Sloan's.

Catsimatidis owned 32 Sloan's Supermarkets in the New York area, 21
operated by Red Apple and 11 by Sloan's. Catsimatidis made several
public announcements indicating his plan to undertake a strategy of
growth through the acquisition of several more supermarkets. At the
time, there was an ongoing antitrust investigation regarding Sloan's and
its CEO.

Sloan's did not report the investigation in its public filings with the
Securities and Exchange Commission or in announcements to shareholders.
RMED argued that these misrepresentations and omissions concerned
material facts that were made to deceive the shareholders in violation
of Section 10(b) of the Securities and Exchange Act, and caused an
artificial inflation of Sloan's stock prices. Catsimatidis filed a
motion to dismiss the expert's testimony before a New York district
court on the grounds that it was not relevant or reliable as required
pursuant to Daubert.

                     Expert Witness' Testimony

RMED retained the services of Candace Preston, a charteredfinancial
analyst and managing director at the Bank of New York Capital Partners,
as an expert witness on the subjects of materiality, causation and
damages. Through her study, she found that Sloan's stock often traded at
higher price-to-earnings (P/E) values than the overall market and other
supermarket companies, proving that investors expected high future
earnings and growth.

Preston also interviewed RMED's chairman and reviewed the depositions of
several shareholders. She examined the daily trading prices and reported
trading volume of Sloan's stock before, during and after the time period
in question. By correlating the dates of Catsimatidis' announcements to
the company's stock prices, she found that stock sales increased in the
period following his announcements.

Preston also compared Sloan's stock prices during the time period in
question with the "true value" at which the stock would have been traded
absent the alleged fraud. She found that no events other than the
alleged fraud affected the stock's prices. Preston then determined the
damages by analyzing information about actual purchases and sales of
Sloan's stock and estimated the remaining damages by using a
computerized trading model simulating the number of shares affected by
the fraud.

                      The Defendant's Response

Catsimatidis argued that Preston's methods had a high potential rate of
error, and that the stock's price movement was tied to earnings, which
did not make it attributable to the alleged fraud. Since the alleged
fraud began at approximately the same time as Sloan's existence as an
operating company, Preston had no "clean" period to compare stocks. The
district court, however, determined that Preston's methods were the best
possible alternative in the given circumstances.

Catsimatidis did not make a single, clean announcement concerning his
alleged omissions. Rather, as shareholders realized the acquisition of
other supermarkets was not materializing, Sloan's stocks gradually
declined. Preston used various methods to determine that the positive
effects of stock sales on Sloan's price were a direct result of
Catsimatidis' announcement of his growth-through-acquisition strategy,
and were therefore a direct result of the slow leak of information
concerning the alleged fraud.

The district court determined that Preston's proposed testimony was
sufficiently reliable to be admitted as evidence against Catsimatidis in
the fraud case. Even though Preston's damages estimate could not be
measured with mathematical precision because she did not employ
statistical methods, the court determined that was an insufficient basis
to exclude her proposed testimony. Therefore, the defendants' motion to
exclude the testimony was denied.

RMED was represented by Arthur R. Lehman of Lehman & Gikow, P.C., in New
York. (Mergers & Acquisitions Litigation Reporter, April 2000)


STATE BOARD: Judge to Rule on Indiana Property Tax System
----------------------------------------------------------
Judge Thomas G. Fisher is calling for an end to the long-delayed fix of
Indiana's property tax regulations and is expected to announce his
recommendation for how it should be done within a month.

Fisher publicly denounced Indiana's three branches of government for
failing to remedy the tax system at a April 25 hearing in the lingering
case before his court, Town of St. John, et al. v. State Board of Tax
Commissioners.

"Outrageous" was how Fisher termed the situation, which stems from a
December 1998 Supreme Court ruling that struck down the existing tax
assessment rules. The high court ruled the state's assessment method was
not based on objective data and thus wasn't verifiable in court.

The Tax Board has set a March 1, 2001, target for completing the next
general assessment, which was to have been conducted starting Jan. 1,
1999. A group of legislators, led by Sen. Luke Kenley, R-Noblesville,
want the reassessment begun before the next session so revisions to the
code can be passed through the General Assembly by the spring of 2001.

However, most close to the Tax Board already feel pressed to meet the
March deadline. Gov. Frank O'Bannon has balked at moving ahead with a
new assessment for fear the one-time tax increase would be significant a
wise move in the eyes of supporters backing his November reelection bid.

O'Bannon's hope that the legislature would grant a two-year delay before
the next reassessment to shield homeowners from the expected tax hike
went unfulfilled last spring.

A coalition of groups, led by the Indiana Association of Realtors and
Chamber of Commerce, filed a joint brief of amici curiae in support of
the town, 57 Lake County and three Marion County property owners and the
Indiana Civil Liberties Union. The class-action lawsuit challenges the
validity of the 1989 revaluation before Fisher's tax court.

Lead counsel Larry Stroble of Barnes & Thornburg wrote in the amici
brief that by maintaining an unconstitutional system of valuing
property, the state is hampering economic development and dissuading
businesses from locating in Indiana.

"The failure to meet the Court's mandate for 'diligent and expeditious'
progress has created a state of affairs that cannot be permitted to
continue indefinitely," Stroble wrote. "As Indiana companies develop
their business and investment plans, and out-of-state companies decide
whether to expand here, they have no way of projecting their future
Indiana property tax liabilities because no one can tell them the basis
on which such taxes will be imposed in the future."

Fisher's expected ruling could force the state's hand in correcting the
flawed system. That ruling could come as soon as early June. (The
Indiana Lawyer, May 10, 2000)


TCC INDUSTRIES: Securities Suit Settlement Preliminarily Approved in CO
-----------------------------------------------------------------------
The United District Court for the District of Colorado has preliminarily
approved the Settlement of a Class Action, Civil Action 99-M-611, based
on alleged violations of the Securities and Exchange Act of 1934.

This announcement to all persons who purchased TCC Industries, Inc.
("TCC") (OTC BB:TELC) Common Stock between September 3, 1997, and
January 25, 1999, inclusive (the "Class Period") serves as Summary
Notice of the preliminary approval of the Class Action and is issued
pursuant to an Order of the Court. All potential Class members are
hereby notified, pursuant to Rule 23 of the Federal Rules of Civil
Procedure and an Order of the Court dated April 13, 2000, that a hearing
will be held on Friday, July 28, 2000, at 10 a.m. in the United States
District Court for the District of Colorado, Courtroom A, United States
Courthouse, 1823 Stout Street, Denver, Colorado 80202, to determine: (1)
whether the proposed settlement of the above-entitled class action
for$750,000 in cash (the "Settlement Fund") should be approved by the
Court as fair, reasonable, and adequate; (2) whether the application of
plaintiffs' counsel for an award of attorneys' fees and reimbursement of
expenses should be approved; and (3) whether the action should be
dismissed with prejudice.

Contact: TCC Securities Litigation c/o Claims Administrator Paul
Mulholland, 610/891-7255 or Vinton Nissler Allen & Vellone, P.C.,
Patrick D. Vellone, Esquire, 303/534-4499 or Berger & Montague, P.C.
Jacob A. Goldberg, Esquire, 215/875-3000


TOBACCO LITIGATIION: Judge Asked to Cap Punitive Before Jury Gets Case
----------------------------------------------------------------------
The tobacco industry is pressing a judge to limit potential punitive
damages in the first smokers' class-action trial before an unfriendly
jury gets to consider the high-stakes money question. Big Tobacco wants
the judge to cap the verdict at 10 percent of the industry's value to be
determined in a minitrial scheduled to begin with opening statements,
calling the $100 billion amount listed in the lawsuit "patently and
absurdly excessive." "By any conceivable measure, the award sought by
plaintiffs is illegally excessive under Florida law and the United
States Constitution by several orders of magnitude," the tobacco motion
said.

The request is among 19 or 20 motions to be considered by Circuit Judge
Robert Kaye in tobacco's first punitive damage phase covering a large
group of smokers. Although the industry has settled state lawsuits for $
250 billion, Big Tobacco has not paid a penny in a smokers' trial.

The jury in the case covering approximately 500,000 sick Florida smokers
already has ruled the nation's five biggest cigarette makers conspired
to produce a deadly product and awarded $12.7 million in damages to
three sick smokers. Punitive damages would cover the whole group.

The two sides are far apart on issues besides money. The smokers'
attorneys want to exclude most of the industry's proposed witnesses, and
the industry wants to limit potentially damaging testimony. The issue of
race in a case before a six-member jury with four blacks has entered the
case again. The industry asked the judge to order smokers to stop
injecting race into the trial. But proposed tobacco witnesses include
Macon, Ga., Mayor C. Jack Ellis, the first black mayor in the city's
176-year history, and Garth Reeves, former publisher of The Miami Times,
an African-American community newspaper, and an esteemed community
leader.

The industry also wants to exclude:

* Testimony that the industry has not made meaningful changes in
   policies and procedures.

* The possibility of a verdict to be paid over time, like the state
   settlements covering tobacco payments through 2025.

* Mention of parent and affiliated companies, the industry's financial
  reserves for lawsuits, corporate activity abroad and punitive damage
  awards in other lawsuits.

Under the state settlements, the industry has agreed to limit youth
promotions, remove billboards and cut other marketing. The industry is
counting on testimony about those policy changes to keep the verdict
down.

The defendants are Philip Morris Inc., R.J. Reynolds Tobacco Co., Brown
& Williamson, Lorillard Tobacco Co., Liggett Group Inc. and the
industry's Council for Tobacco Research and Tobacco Institute. (The
Associated Press, May 16, 2000)


TRANSCRYPT INTERNATIONAL: Concludes Legal Issues from Shareholder Suits
-----------------------------------------------------------------------Transcrypt
International, Inc. (OTC Bulletin Board: TRII) announced on May 15 that
it has entered into a Conditional Mutual Release and Settlement
Agreement with PricewaterhouseCoopers LLP and Physicians Mutual
Insurance Company that will result in the dismissal of Physicians
Mutual's action against the Company filed in District Court of Douglas
County, Nebraska. In addition, the Company has entered into a
Conditional Mutual Release and Settlement Agreement with
PricewaterhouseCoopers LPP dismissing Transcrypt's action against
PricewaterhouseCoopers.

Michael E. Jalbert, chairman and chief executive officer, notes, "With
this settlement, we have concluded all outstanding claims resulting from
the class action lawsuits of the past. It allows us to put our full
energy and attention into company operations, as we work to build our
success in the wireless communications market." He adds, "We are
optimistic that we can resolve the SEC litigation this year without
financial penalties, with relisting on the Nasdaq SmallCap Market a
major priority."

Physicians Mutual Insurance Company's complaint contained common law
actions relating to the facts and circumstances underlying the Company's
restatement of its 1996 and 1997 financial results.

In March 1999, Transcrypt filed a claim against PricewaterhouseCoopers
for professional negligence in the context of the audits. This
settlement agreement concludes all outstanding legal issues between the
Company and its former auditors.

Transcrypt International, Inc. ( www.transcrypt.com ) designs,
manufactures and markets trunked and convention radio systems,
stationary land mobile radio transmitters and receivers, including
mobile and portable radios, and manufactures information security
products that prevent the unauthorized interception of sensitive voice
and data communication.

Certain matters discussed in this press release constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of These forward-looking statements relate to the
Company's efforts regarding its litigation. These forward-looking
statements are subject to certain risks and uncertainties that could
cause the actual results, performance or achievements to differ
materially from those expressed, suggested or implied by the
forward-looking statements due to the number of risk factors including,
but not limited to, risks associated with the Company's litigation, and
other risks detailed in the Company's reports filed with the Securities
& Exchange Commission, including its Annual Report on Form 10-K for the
year ended December 31, 1999.


WORLD ONLINE: Founder Brink Admits Link to Five Failed Firms
------------------------------------------------------------
World Online International founder and former chairwoman Nina Brink
acknowledged she was involved with five failed companies that were not
mentioned in the prospectus for the Internet service provider's
flotation, the Wall Street Journal reported.

Brink said in an interview with the Wall Street Journal that she was a
minority shareholder in those companies and at one point held a senior
management post at some of them, adding that she was not part of the
"daily management" at the time they declared bankruptcy or were
liquidated. She said that the flotation's lead co-ordinators, ABN Amro
Bank's joint venture ABN Amro Rothschild and Goldman Sachs Group Inc,
were aware of her connection to these failed companies and that it was
their decision to omit the information from the prospectus. One
bankruptcy case is still open. "These were companies that had no
activities. They were empty," Brink was quoted as saying. "They were
liquidated for financial reasons."

One Goldman Sachs spokesman said the firm believes the prospectus "was
full and complete".

An attorney for disgruntled World Online shareholders who plan to file a
class action lawsuit, Bob van der Goen, was quoted as saying: "I can't
understand why this was not mentioned (in the prospectus). It's
unbelievable."

Van der Goen represents more than 1,000 World Online shareholders who
allege that the Dutch company and ABN Amro Holding violated Dutch
securities regulation by providing a prospectus that contained
"incorrect or inadequate" information which gave shareholders a
"misleading impression" of the company.

The revelation that Brink had sold two-thirds of her stake in the
company three months before the flotation at a price of 6.04 euros per
share has sent the share price tumbling. World Online was listed on
March 17 at 43 euros per share. (Agence France Presse, May 16, 2000)


* Troubles Seen in New SEC IOSCO Disclosure Standards
-----------------------------------------------------
Last fall, the U.S. Securities and Exchange Commission adopted http:
//www.sec.gov/rules/final/34-41936.htm target=_blank>new disclosure
requirements for foreign companies that wish to register offerings of
their securities in the United States or to list their securities on
U.S. exchanges. These rules adopt almost verbatim the international
disclosure standards issued by the International Organization of
Securities Commissions the year before. While the IOSCO standards
themselves generally followed SEC disclosure standards, there is a
substantial difference in the required disclosure of "beneficial
ownership" that will prove troublesome to many foreign companies-and
that may also create problems for U.S. companies desiring to list their
securities abroad.

The SEC's adoption of the IOSCO standards, effective as of Sept. 30,
2000, makes three principal changes in requirements for foreign
companies:

1. A foreign private issuer must disclose information about the
   ownership interests of each of its directors and executive officers
   on an individual basis, rather than in the aggregate, as was
   permitted under prior SEC rules.

2. The threshold for determining which shareholders must be disclosed
   as " major" has been lowered from those who hold 10 percent to those
   who hold 5 percent of the company's stock.

3. Major shareholders are defined in terms of "beneficial owners" of a
    company's stock, which includes recipients of the economic benefits
    of stock ownership, such as the beneficiaries of a trust. Under the
    previous rules (which continue to be applicable for SEC filings by
    U.S. companies), beneficial ownership of stock meant the right to
    vote or sell shares.

The first two changes bring disclosure for foreign companies generally
in line with the disclosure required of U.S. companies. The third
change, however, takes disclosure for foreign companies significantly
beyond that required of domestic companies. Not only is this troublesome
for foreign companies desiring access to U.S. capital markets, but it
will also pose significant problems for U.S. companies trying to access
capital markets abroad.

The new disclosure rules are set forth in Form 20-F, the basic
registration statement for foreign private issuers wishing to list their
securities on a U. S. exchange. Subsection A of Item 7 of the new form
provides the disclosure requirements related to major shareholders. This
subsection is designed to identify for investors those who control or
may control the company. Subsection A requires a company to provide, to
the extent known by the company or available in public filings, and as
of the most recent practicable date, information on the following four
matters.

First, with respect to the expanded class of major shareholders, the
company must provide their names, the number of shares beneficially
owned by each of them, the percentage of outstanding shares of each
class owned by each of them, any significant change in the percentage
ownership held by any major shareholder during the past three years, and
a statement indicating whether the major shareholders have different
voting rights.

Additionally, if the company is required by its home jurisdiction to
disclose shareholders owning less than 5 percent of the company, then
the lesser percentage is required by the new Form 20-F as well. For
example, in the United Kingdom the disclosure threshold for major
shareholders is 3 percent, so a U.K. company registering an offering of
its shares with the SEC would disclose any shareholder beneficially
owning 3 percent or more of the company's voting stock. And if a company
does not have any major shareholders, it must provide a statement to
that effect.

Second, the company must disclose the portion of each class of its
securities that are held in the host country and the number of
stockholders in the host country. Third, the company must disclose the
name of any corporation, foreign government, or other natural or legal
person that severally or jointly, directly or indirectly, owns or
controls the company, and the nature of such control, including the
amount and proportion of shares with voting rights owned by any such
entity. Fourth, the company must disclose any arrangements that may
result in a future change in control of the company.

To Whose Benefit?

As noted, a major shareholder is now defined in Form 20-F as the
beneficial owner of 5 percent or more of each class of the company's
voting securities. " Beneficial owner" is defined as "any person who,
even if not the record owner of the securities, has or shares the
underlying benefits of ownership," which "include the power to direct
the voting or the disposition of the securities or to receive the
economic benefit of ownership of the securities." This definition, which
is taken verbatim from the IOSCO standards, includes " persons who hold
their securities through one or more trustees, brokers, agents, legal
representatives, or other intermediaries, or through entities in which
they have a controlling interest, which means the direct or indirect
power to direct the management and policies of the entity."
Additionally, persons possessing the right to acquire securities within
60 days by option or other agreement are deemed beneficial owners of
those securities. This definition is broader than the concept of
beneficial ownership under SEC Rule 13d-3 and Rule 16a-1(a)(1) under the
Securities Exchange Act.

The new Form 20-F does not provide further guidance regarding
interpretation or application of the concept of economic benefit.
However, it appears that beneficial owners would include any person who,
through any arrangement, has or shares a direct or indirect pecuniary
interest in the securities regardless of whether such person has the
right to vote or control the decision to hold or dispose of the shares.
A pecuniary interest would be any opportunity, directly or indirectly,
to profit from a transaction in a security. (This pecuniary interest
test is already used for purposes of the short-swing profit recapture
provisions of '16(b) of the Securities Exchange Act, which apply to 10
percent-not 5 percent-shareholders, but is not used for purposes of
determining who is a control person.)

In the release announcing the amendments to Form 20-F, the SEC did not
expressly address the change from the prior concept of ownership to the
beneficial ownership concept. It is possible, therefore, that the SEC
staff did not fully appreciate the significance of the adoption of a
pecuniary interest test. Nor is it clear why the markets need to know
about pecuniary interests as opposed to control interests, which is the
standard applicable to U.S. companies under existing rules.

Foreign investors often are very reluctant to publicize their holdings,
and may go to great lengths to preserve their anonymity by placing their
holdings in trusts or similar arrangements. Reasons for this range from
fear over personal safety for themselves and their families (kidnapping
and extortion are real threats in many other countries) to tax
avoidance.

Consequently, many foreign investors balk at the strict disclosure rules
now applicable in the United States. It is already difficult for U.S.
lawyers representing foreign companies to get the "true facts" under the
old disclosure rule. Laboring under the new rule, lawyers can expect
substantial resistance from foreign investors to questions about who has
a purely pecuniary interest in the shares of foreign companies.

Under the current rule, for example, the trustee-or the person who has
the right to vote or sell the shares of a foreign public company-has to
be disclosed if the 10 percent ownership threshold is reached. Under the
new rule, any beneficiary of the trust will apparently have to be
disclosed if the beneficiary has an economic interest in a mere 5
percent of the shares of the company. Rest assured that a lot of
attorney time will be spent on trying to elicit this information, in
order to produce the certificates and other documentation necessary to
substantiate the customary legal opinions given in a public offering.

IOSCO recommends that all IOSCO members adopt the organization's
International Disclosure Standards for cross-border offerings and
initial listings by foreign companies. Ironically, this means that U.S.
companies engaged in cross-border offerings or listing their securities
on foreign exchanges may face these same beneficial ownership rules
abroad.

This creates the possibility of different (indeed, broader) disclosure
overseas than at home, which could be confusing to investors, analysts,
and other market participants. U.S. companies are likely to be
surprised-"stunned" may be the more apt description-to learn that a
foreign country adopting the IOSCO standards requires disclosure that
exceeds SEC requirements.

With securities markets becoming increasingly global, there is no doubt
that the efforts of IOSCO and the SEC to develop international
disclosure standards are worthwhile and necessary. As the SEC said in
the release adopting the new standards:

Technological advances have made it easier than ever for investors to
learn about and invest in foreign companies. Because of the increasing
flow of capital across borders, (the SEC) and other securities
regulators around the world have an interest in ensuring that a high
level of information is available to investors in all markets. For this
reason, (the SEC has) been actively involved in IOSCO's efforts to
develop a set of high quality international disclosure standards that
could be used in cross-border offerings and listings.

Indeed, nowhere are these efforts more important than in the development
of international accounting and audit standards that can be used in
global securities markets. IOSCO has a project under way on this very
subject that is supported by the SEC.

While the SEC thus deserves credit for supporting the international
harmonization of disclosure rules and accounting standards, there
appears to be little justification for changing the traditional SEC
definition of beneficial ownership. The greater disclosure of pecuniary
or economic beneficiaries, absent the control factor, would seem to be
of little interest to investors or other market participants, especially
at a 5 percent level. And what is the justification for requiring more
intrusive disclosure about ownership interests in foreign companies than
from our own domestic companies?

Nor should the SEC be under the illusion that this is not a significant
issue. It is a huge issue for many foreign companies that would like to
access U.S. capital markets.

There is a solution. The SEC should amend the new disclosure standards
to revert to the old test for beneficial ownership and, until that is
done, make it clear to foreign issuers and the securities bar that it
will not insist on the disclosure literally required by the adoption of
the IOSCO standards. IOSCO, too, should take these steps with respect to
its International Disclosure Standards. And U.S. companies should
recognize their own interest in promoting such a change so as to avoid
inconsistent disclosure standards at home and abroad. (Legal Times, 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

Class Action Reporter is a daily newsletter, co-published by Bankruptcy
Creditors' Service, Inc., Princeton, NJ, and Beard Group, Inc.,
Washington, DC. 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
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The CAR subscription rate is $575 for six months delivered via e-mail.

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                    * * *  End of Transmission  * * *