/raid1/www/Hosts/bankrupt/CAR_Public/000620.MBX
C L A S S A C T I O N R E P O R T E R
Tuesday, June 20, 2000, Vol. 2, No. 119
Headlines
ADAMS LAND: Lawsuit over Odor Can Proceed But Not As Class Action
ADRIANE BERG: Heller, Horowitz Files Investors Suit in New York
BRANCH DAVIDIAN SIEGE: CNN Coverage on Jury Selection in Texas
CITRIX SYSTEMS: Harvey Greenfield Files Securities Suit in Florida
CITRIX SYSTEMS: Kantrowitz, Goldhamer Files Securities Lawsuit in FL
COCA-COLA: Says New Employee Racial Bias Suit of Derails Settlement
COLUMBIA LABORATORIES: Faruqi & Faruqi Files Securities Suit in Florida
CT DEPT: Legal Aid Attys Seek Higher Medicaid Dental Reimbursement Rate
DELIAS INC: Intends to Defend Vigorously Securities Suits in N.Y.
ECONNECT: Faces SEC Suit for Fake Press Releases Posted By Tree Trimmer
FLOORING AMERICA: Files for Bankruptcy, Announces Berman, DeValerio
FLOORING AMERICA: Milberg Weiss Announces Securities Lawsuit in Georgia
GUN MAKERS: Judge considers rejecting Gunfire accusations against Govt
INDIAN VILLAGE: Ct OKs Manor Sale Suit Alleging Detroit Law Violation
INMATES LITIGATION: Sp Ct Reinstates Fed Law Limiting State Oversight
PDB SPORTS: Broncos Season Ticket Holders Sue over Prices of 15 Years
PROFIT RECOVERY: Schiffrin & Barroway Files Securities Lawsuit in GA
PUROLATOR AIR: Restitution of Earned Wages Ruled As Appropriate Remedy
SCALAS: Husband and Wife Accountants under Grand Jury Investigation
SIGMA DESIGNS: Hearing on Securities Complaints in CA Set for June
SWEATSHOPS: Activists Put Regis Philbin Clothing Line on The Line
* Australian Paper's Views on Internet Disability Friendliness
* Senate Judiciary Postpones Action on Internet Privacy Bill
* US and UK Open Talks on 1994 Treaty; UK Firms May Be Targets of Suits
*********
ADAMS LAND: Lawsuit over Odor Can Proceed But Not As Class Action
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A lawsuit against Adams Land & Cattle Co. near Broken Bow can proceed but
not as a class-action, District Judge Ronald Olberding has ruled. A
potential conflict of interest existed in the class, originally cited as
4,000 Broken Bow area residents, preventing the lawsuit from being
considered a class-action, Olberding said last Friday June 16. Dahl
requested dismissal of the class certification and Olberding agreed.
The lawsuit was filed in December by 11 plaintiffs against Adams Land &
Cattle Co., a 93,000 head cattle feeding operation with two locations near
Broken Bow.
Olberding said Nebraska class-action law is unique in the United States in
that it does not allow for a class action if there is a conflict of
interest among class members or even the possibility of such a conflict.
Defense attorney Kelly Dahl of Omaha claimed conflicts of interest since
not all people who live in the Broken Bow area agree with the lawsuit and
would not wish to be represented by it. Some of those residents include the
Adams family, their 165 employees, merchants who sold the feedlot goods and
services and farmers who annually sell 10 million bushels of corn to the
feedlot for cattle feed.
The plaintiffs complain of offensive odor and dust problems in and for
miles around Broken Bow. Their attorneys claim the odor and dust affected
everyone in the area and thus a class-action was proper.
Attorney Patrick O'Brien said after the ruling that his clients planned to
go on with the lawsuit against the feedlot.
Also this week, Adams' attorneys filed a countersuit against one of the
plaintiffs. The company's suit claimed Broken Bow banker and businessman
Carl Norden was harming the company through his participation in the
nuisance lawsuit.
The suit said in Norden's prior relationship with the company as one of
their loan officers, he encouraged the feedlot's growth and expansion. (The
Associated Press State & Local Wire, June 19, 2000)
ADRIANE BERG: Heller, Horowitz Files Investors Suit in New York
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A class action entitled Arlene Gervis, et al. v. Adriane Berg, et al., Civ.
Action No. 00-3362 (E.D.N.Y.) is now pending in the United States District
Court for the Eastern District of New York.
This Notice is directed to all members of the proposed Class defined as:
All persons who have sustained out-of-pocket losses during the period from
on or about January 1, 1985 through and including February 18, 2000 (the
"Class Period") (i) as a result of having entrusted funds for the purchase
of money market fund shares or mutual fund shares or other investments to
William Goren, and/or New Times Securities Services, Inc. and/or New Age
Financial Services, Inc. and/or New Age Securities Corporation and/or New
Times Securities Corporation and/or any person (a "Co-Conspirator") acting
in concert with Goren as a participant in a fraudulent scheme pursuant to
which funds so entrusted were then stolen by Goren or by any such
Co-Conspirator or used for purposes other than to effect the securities
transactions requested, and/or (ii) as a result of having paid money for
the issuance of promissory notes evidencing indebtedness of Goren and/or
New Age Financial Services, Inc. Excluded from the Class are defendants and
officers, directors and employees of defendants.
Claims for violation of Section 12(a)(1) and (2) of the Securities Act, for
violation of Section 10(b) of the Securities Exchange Act, for violation of
the Racketeering Influenced Corrupt Organization Act, for fraud, unjust
enrichment and conversion have been asserted against individuals and an
accounting firm alleged to have acted in concert with Goren. Claims for
violation of Section 20(a) of the Securities Exchange Act and Section 15 of
the Securities Act, for aiding and abetting fraud and for unjust enrichment
have been asserted against MONY Securities Corporation and MONY Life
Insurance Company. Claims for violation of Section 10(b) of the Securities
Exchange Act, for violation of Sections 349 and 350 of the General Business
Law of the State of New York, for fraud, negligence, breach of fiduciary
duty, aiding and abetting fraud and breach of fiduciary duty, conversion
and unjust enrichment have been asserted against Adriane Berg. Claims for
violation of Section 20(a) of the Securities Exchange Act, for aiding and
abetting fraud, for respondeat superior liability for the conduct of
Adriane Berg and for unjust enrichment and have been asserted against
WABC-AM Radio, Inc. Claims for aiding and abetting fraud and breach of
fiduciary duty, for conversion and unjust enrichment have been asserted
against Roger Goren, Shelley Goren, Stuart Bochner and the Bochner Family
Limited Partnership. Claims for commercial bad faith and for conversion
have been asserted against Fleet Bank.
Claims for negligence and failure to warn have been asserted against
National Financial Services Corporation. No later than sixty (60) days
after the date this Notice is published, any member of the proposed class
may move the Court to serve as lead Plaintiff of the proposed Class.
Contact: Heller, Horowitz & Feit, P.C. Sigmund S. Wissner-Gross
212/685-7600
BRANCH DAVIDIAN SIEGE: CNN Coverage on Jury Selection in Texas
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Broadcast on Cable News Network on June 19, 2000
Highlight: Jury selection begins today in Waco, Texas in a wrongful
death lawsuit stemming from the Branch Davidian raid seven years ago. The
federal government is being sued for $675 million and the plaintiffs
include survivors of the raid and relatives of some of the 80 Branch
Davidians who were killed.
CAROL LIN, CNN ANCHOR: Jury selection begins today in Waco, Texas in a
wrongful death lawsuit stemming from the Branch Davidian raid seven years
ago. The federal government is being sued for $675 million and the
plaintiffs include survivors of the raid and relatives of some of the 80
Branch Davidians who were killed.
Our national correspondent Tony Clark is covering the story and he comes to
us now from Waco.
Good morning, Tony.
TONY CLARK, CNN NATIONAL CORRESPONDENT: Good morning, Carol.
They're going to pick six jurors and an alternate to hear this case,
they're an advisory panel. Juries are not usually selected in civil cases
like this in federal court.
The jury will be asked to answer four questions, there are four issues
here: first is whether or not members of the Bureau of Alcohol, Tobacco and
Firearms fired indiscriminately during the initial raid on the Branch
Davidian compound in February of 1993; then, whether the FBI violated
Washington-approved plans by prematurely tearing down the Branch Davidian
compound; they will also be asked whether the government bears
responsibility for the start or spread of the fire that consumed the
compound and left more than 80 people dead; and whether the government was
right or wrong in having no plans to fight the fire.
Government attorneys say all of the blame rests with leader David Koresh
and his followers, but plaintiffs' attorney Mike Caddell says he admits
that the Davidians, themselves, bear some responsibility for what happened.
(BEGIN VIDEO CLIP)
MIKE CADDELL, PLAINTIFFS' ATTORNEY: The first thing we will tell the
jury is: We're not here to defend David Koresh. And the second thing we
will tell the jury is: We acknowledge that there were many weapons at Mount
Carmel, and we're going to even tell them the number of the weapons at
Mount Carmel. And we're going to tell them that we're not here to defend or
to try to excuse the deaths of four ATF agents and the injuries to other
ATF agents, that's not what this trial of about. Having said that, though,
that doesn't mean that the government, once it makes an attack like that,
that it can fire blindly.
(END VIDEO CLIP)
CLARK: In fact, what the plaintiffs' attorneys will argue is that
during that initial raid that members of the ATF simply shot at any kind of
movement they saw, shot blindly, and that they could have been shooting at
innocent women and children.
Perhaps the most controversial issue was whether or not the FBI shot at the
Davidians on the final day of this standoff, as seemed to be indicated by
an infrared tape, flashes on the infrared tape. That issue will not come
up, the judge has given the attorneys -- the plaintiffs' attorneys until
the end of the week to show evidence and why he should not simply throw
that out because of an independent expert's analysis that that was debris
and not gunfire on the infrared tape.
Tony Clark, CNN, Waco, Texas.
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SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
CITRIX SYSTEMS: Harvey Greenfield Files Securities Suit in Florida
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The Law Firm of Harvey Greenfield has filed a class action lawsuit in the
United States District Court for the Southern District of Florida on behalf
of purchasers of securities of Citrix Systems (NASDAQ: CTXS) ("Citrix" or
the "Company") between October 20, 1999 and June 9, 2000 (the "Class
Period").
The complaint alleges that Citrix and its executives made false and
misleading statements concerning the Company's business and financial
condition during the Class Period, in violation of Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934 and SEC Rule 10b-5. In particular,
the complaint charges the defendants with failure to disclose negative
revenue growth resulting from the Company's shift from sales of software in
"shrink-wrap" boxes to sales by a paper/electronic licensing model. The
complaint also alleges that the Company experienced slower than reported
expansion of its core business with large enterprise accounts, and slower
than reported expansions into certain markets, including Asia. These false
and misleading statements resulted in artificially inflating the price of
the Company's stock during the Class Period; when the Company announced
that its results for the second quarter of 2000 would be far lower than
investors had been led to believe, the stock price dropped over 40% to $22
per share in one day.
Contact: Harvey Greenfield, Esq. at the Law Firm of Harvey Greenfield, 60
East 42nd Street, Suite 2001, New York, NY 10165, telephone 212-949-5500,
or toll free 877-949-5500, facsimile 212-949-0049, or by e-mail at
hgreenf@banet.net.
CITRIX SYSTEMS: Kantrowitz, Goldhamer Files Securities Lawsuit in FL
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A lawsuit has been filed by the law firm of Kantrowitz, Goldhamer &
Graifman, of Chestnut Ridge, New York on behalf of Plaintiff and a proposed
class of purchasers of common stock of Citrix Systems, Inc. (NASDAQ:CTXS)
against Citrix Systems, Inc. and certain officers and directors for the
class period October 20, 1999 through June 9, 2000 ("Class Period"), in the
U.S. District Court for the Southern District of Florida, Fort Lauderdale
Division located at 299 E. Broward Boulevard, Fort Lauderdale, FL 33301 in
an action entitled Saunders v. Citrix Systems, Inc., Index Number
00-cv-6830 (J. Ferguson).
The complaint alleges that Citrix and Mark B. Templeton (Chief Executive
Officer and President), John P. Cunningham (Chief Financial Officer) and
Edward E. Iacobbucci (Chairman of the Board) violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder, by making false and misleading statements and omissions
concerning the Company's revenue and financial condition for the fiscal
year 2000 in that defendants stated that customer demand for the Company's
products along with its business strategy favorably positioned the company
as a leading provider of information technology, a statement that was
materially false and misleading in that the Company knew or recklessly
disregarded that its true financial status was deteriorating and that its
alleged stellar growth would not continue. The defendants made other
statements concerning alleged expansion into Asia and concerning the actual
viability of its products in the current market. Upon revelation of this
news, the Company's common stock price fell by approximately 48%. As a
result of these alleged violations, the price of common stock of Citrix was
artificially inflated during the Class Period.
Contact: Kantrowitz, Goldhamer & Graifman Gary S. Graifman, Esq.
800/660-7843 or 845/356-2570 kgg@kgglaw.com
COCA-COLA: Says New Employee Racial Bias Suit of Derails Settlement
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Coca-Cola Co. has criticized a new racial discrimination lawsuit filed
against the soft-drink giant, saying it was designed to derail a tentative
settlement involving a similar discrimination suit.
The beverage giant has struggled to maintain its once-sterling image in the
past few years, and the settlement with black employees was seen as
confirmation that new chairman Douglas Daft was fixing many of the public
relations problems he inherited. But hours after Coke reached the tentative
agreement, it learned that Johnnie Cochran Jr., who defended O. J. Simpson,
and another lawyer had filed another race-discrimination lawsuit, this one
1 alleging that black women had been passed over for promotion, paid less
than their white colleagues, and forced to do demeaning jobs such as
cleaning up after their bosses ate lunch.
The new suit, filed last Wednesday June 14 in Fulton County Superior Court,
involves four black women who are current or former Coke employees, and
seeks $ 1.5 billion. The women, including managers and administrative
assistants, claim whites with less experience were paid more and promoted
faster. Their complaints to superiors were ignored, and in some cases they
were retaliated against, the lawsuit says.
Carl Ware, Coke's executive vice president of global affairs, called the
suit "blatant and disruptive legal maneuvering" designed to derail a
settlement of the federal suit. Coke and lawyers for four others suing the
company agreed to settle the 14-month-old suit. Details of the settlement,
which is expected to include money for about 2,000 potential class members,
have not been released.
U.S. District Judge Richard Story signed an order staying the litigation
until Oct. 30 after lawyers told him they would be able to conclude the
details in six months. Willie Gary, a Stuart, Fla. personal injury attorney
who filed the new suit with Cochran, said that his suit is unrelated to
resolution of the federal case.
Gary criticized the settlement's secrecy and said it was unlikely to be
large enough to redress discrimination throughout the company. And he said
$ 1.5 billion would be"peanuts"for the Atlanta-based company. "I think
that's a small price for Coke to pay to correct 20 to 30 to 40 years of
discrimination in these types of cases,"Gary said.
Cyrus Mehri, the lead plaintiff attorney in the federal suit, called the
large damage request"laughable." He said the lawsuit would not affect his
clients settlement. "Those kinds of statements are not credible," Mehri
said.
But other lawyers said some of those in line for money may have doubts
about the settlement when they hear about the new, larger suit. "New
litigation always has the potential for derailing the initial suit
settlement, even if it's separate groups of people,"said William B. Gould
IV, a labor and employment discrimination law professor at Stanford Law
School and former chairman of the National 1 Labor Relations Board. "As a
practical matter, you know that's simply going to be unsettling to one
group and perhaps conceivably raise people's expectations."
Lawyers said the settlement probably will involve a detailed assessment of
each job at Coke, how much each person doing that job earns and an attempt
to equalize compensation based on factors such as experience, skills,
tenure with the company and market factors. David Swider, an Indianapolis
employment discrimination lawyer who defends companies in such suits, said
the settlement also is likely to include new diversity and sensitivity
training programs as well as personnel file revisions and related
compensation changes.
Coke's decision to settle is not surprising, especially because so much of
its business hinges on its image, the lawyers said. "Most civil suits in
general settle, and especially suits like this that involve bad publicity
for the company,"said Eugene Volokh, a UCLA discrimination law professor.
(The Record (Bergen County, NJ), June 16, 2000)
COLUMBIA LABORATORIES: Faruqi & Faruqi Files Securities Suit in Florida
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A class action lawsuit was commenced in the United States District Court
for the Southern District of Florida on behalf of all purchasers of
Columbia Laboratories, Inc. (Amex: COB) common stock between November 8,
1999, and June 9, 2000, inclusive (the "Class Period").
The complaint charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.
Among other things, plaintiff claims that defendants issued a series of
materially false and misleading statements in press releases and SEC
filings concerning the state of Columbia Laboratories' financial condition.
As a result, the price of Columbia Laboratories' common stock was
artificially inflated throughout the Class Period. When the Company
announced, on June 12, 2000, that its highly touted Advantage-S treatment
for women failed to demonstrate that the product could prevent the
transmission of the HIV/AIDS virus, the stock price of Columbia
Laboratories declined in excess of 55% from the prior day's close.
Contact: Faruqi & Faruqi, LLP, New York Anthony Vozzolo, ESQ. Ms. Lana
Yamnizki, Shareholder Relations Manager Tel: 877/247-4292 or 212/983-9330
Fax: 212/983-9331 e-mail: FaruqiLawAV@aol.com
CT DEPT: Legal Aid Attys Seek Higher Medicaid Dental Reimbursement Rate
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Trying to get proper dental care for poor people in Connecticut is like
pulling teeth, according to a class action complaint filed in federal court
this month. State legal aid attorneys say the state Department of Social
Services fails to provide more than 200,000 state Medicaid managed-care
patients with the dental care required by federal law. The attorneys say
the department's meager reimbursement rate and a surfeit of red tape
discourages state dentists from accepting Medicaid patients.
Carr v. Wilson-Coker asks the court for an order increasing the
reimbursement rate and addressing the onerous administrative problems. Carr
is lead plaintiff Mary Carr, whose 5-year-old grandson suffers daily pain
from a lack of dental care. Patricia Wilson-Coker is the commissioner of
DSS.
The complaint was filed June 8 by attorneys with Greater Hartford Legal
Assistance and Connecticut Legal Services on behalf of an estimated 182,000
children and 51,000 adults who rely on Medicaid managed-care plans for
dental services. Greater Hartford Legal Assistance attorney Jamey Bell says
dentists who accept Medicaid recipients as patients "are taking a bath on
every procedure they provide. At the same time it's a big hassle involved
in getting payment at all. The administrative procedures have to be
improved." She said that federal law requires DSS to reimburse dentists at
a level attractive enough so that Medicaid recipients receive care to at
least the same extent as the general population. But the complaint alleges
that it has been seven years since the state increased the reimbursement
rate for dental services for children, and 11 years since it did the same
for adults.
Bell said that the reimbursement rate for some procedures is lower than the
10th percentile, which means that less than 10 percent of Connecticut
dentists would accept it as full payment for services rendered. For
example, DSS reimburses dentists who conduct a comprehensive oral
examination at $13 for adults and $21.90 for children. The reimbursement
levels for such a service offered by commercial insurers range from $35 to
$55.
The result: The state Department of Public Health determined this March
that fewer than 10 percent of the state's 3,000 licensed dentists are
active Medicaid providers. Two hundred fifty of the 3,000 dentists provide
the vast majority of care for more than 300,000 Medicaid recipients. That
number includes the 233,327 in the plaintiffs' class, plus Medicaid
recipients who don't participate in managed care.
The complaint says the department's failure to provide reasonable and
adequate access to dental care services has led to an "escalating statewide
health-care crisis for low-income persons." Medicaid recipients are
hampered by geography as well. Poor families in rural areas have to travel
long distances in areas without public transportation to find a
participating dentist, says Jean Lewis, the legislative chairwoman of the
Connecticut Dental Hygienists Association. The Hygienists Association
supports the goals of the lawsuit, as do the state Society of Pediatric
Dentists and the state Dental Association. Lewis said many dental
hygienists work in the schools, but that "when we identify children with
needs, there's no place to refer them to. Community and hospital health
clinics have tremendous waiting lists. So do the few dentists willing to
see them."
Plaintiffs' attorneys say that less than 30 percent of children in families
receiving Medicaid get preventive dental care each year Lewis says that
this underserved part of the pediatric population has a much higher rate of
dental disease. "They're sitting there all day in school with pain," she
said. The lack of adequate dental care for poor children "has been bad for
as long as I can remember," Lewis said. "Now, it's critical."
New York and its dentists last month reached an out-of-court settlement in
a similar case brought by that state's dental society, Bell said. The
agreement, reached May 24, will provide $573 million more in Medicaid
dental fees over the next four years. The New York Dental Society filed
suit in February 1999, saying that state's reimbursement rate had not
appreciably increased in 30 years. Bell said similar cases have been filed
recently in New Hampshire and Massachusetts. (The Connecticut Law Tribune,
June 19, 2000)
DELIAS INC: Intends to Defend Vigorously Securities Suits in N.Y.
-----------------------------------------------------------------
In 1999, two separate purported securities class action lawsuits were filed
against Delias Inc. and certain of its officers and directors and one
former officer of a subsidiary. The original complaints were filed in
Federal District Court for the Southern District of New York by Allain Roy
on June 1, 1999 and by Lorraine Padgett on June 3, 1999. The suits were
consolidated into a single class action and an amended and consolidated
complaint was filed on March 22, 2000.
The complaint in this lawsuit purports to be a class action on behalf of
the purchasers of our securities during the period January 20, 1998 through
September 10, 1998. The complaint generally alleges that the defendants
violated Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 thereunder by making material misstatements and by failing to
disclose certain allegedly material information regarding trends in Delia's
business. The complaint also alleges that the individual defendants are
liable for those violations under Section 20(a) of the Securities Exchange
Act. The complaint seeks unspecified damages, attorneys' and experts' fees
and costs, and such other relief as the court deems proper.
On April 14, 2000, Delias Inc. and the other named defendants filed a
motion to dismiss the lawsuit. On May 12, 2000, counsel for the plaintiffs
filed a memo in response to the company's motion and on May 26, 2000,
Delias filed a reply to that response. The company intends to vigorously
defend against these actions.
ECONNECT: Faces SEC Suit for Fake Press Releases Posted By Tree Trimmer
-----------------------------------------------------------------------
eConnect, which is facing investors' suits as previously reported in the
CAR, has been sued by the Securities & Exchange Commission for fake press
releases on message boards posted by a Los Angeles tree-trimmer, Stephen
Sayre on behalf of the company. The Company's president, Thomas S Hughes,
is included in the suit. The Commission has also filed a suit against
Stephen Sayre.
One press release claimed a strategic alliance with a financial concern,
another announced the false acquisition of a sports company.
The suit alleges Sayre put out phoney buy recommendations under the name
Independent Financial Reports, posting them on Internet message boards.
They were also distributed by Business Wire, a paid Internet news service,
and ended up on news services such as Bloomberg and investor web sites such
as Marketwatch.com and TheStreet.com.
Press releases have become big business in the Internet-driven American
investment craze. As New York public relations firm GS Schwartz & Cos
president, Gerald S Schwartz, notes: Investors are increasingly putting as
much credence in paid press releases posted on the Internet as they do in
real journalism.
Some companies argue that their releases are misunderstood. On March 6 this
year, millions of investors were convinced that small Seattle biotech
company NeoRX Corp had found the cure for cancer. The share jumped from $21
to $70 on the day, with volume jumping from the average daily volume of
850000 to 17 million.
The press release was headed: NeoRX Reports Cure of Lung, Breast and Colon
Cancer in Pre-Clinical Animal Studies Using a Single Dose of Pre-Target
Technology. Investors zeroed in on two key words: cure and cancer. Years of
subsequent testing on humans are required before validation.
On March 28, ZixIt Corp announced: The Perot Group Adopts ZixMail for
Secure Internet Communications. ZixIt spiked by $16 to a years high of
96.50 on the news. As it turned out, only one executive of Perot Group had
registered for the ZixIt service. Furthermore, investors confused Perot
Group, a small investment concern owned by Ross Perot, with Perot Systems,
the 7000-employee systems integration giant also owned by Ross Perot. It
clarified the matter the next day. Its share price has since more than
halved to $43.
Years ago, PR agencies that accepted a clients stock as payment were
considered little more than stock promoters. Now, even the most legitimate
accept client equity payments. While Gerald Schwartz defends it You have a
vested interest and a bigger concern for the client earnings-research firm
First Call Corps director Charles Hill says companies increasingly use
press releases to get people to view their numbers more favourably than
they really are.
On March 2, Staples Inc put out a press release playing up the
profitability of its bricks and mortar division while ignoring 88%-owned
Staples.com. The dot.com issued a separate release: Staples.com revenue
grows more than 450% in fourth quarter and year. Buried in the release was
a fourth-quarter loss of $9.8-million.
The report, compiled by BusinessWeek Online, concludes. As pressrelease
language gets murkier and murkier, one thing is crystal clear: investors
who buy on PR sparks are likely to get burned. (Business Times (South
Africa), June 18, 2000)
FLOORING AMERICA: Files for Bankruptcy, Announces Berman, DeValerio
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Law firm Berman, DeValerio & Pease LLP announces that Flooring America,
Inc. (NYSE:FRA) which was named as a defendant in a shareholder class
action filed in the United States District Court for the Northern District
of Georgia has filed for bankruptcy court protection. The shareholder
action, brought by Berman, DeValerio & Pease, LLP, www.bermanesq.com,
however, will proceed against the officers and directors named as
defendants. The class action seeks damages for violations of the federal
securities laws on behalf of all investors who purchased FRA common stock
between November 11, 1999 through and including May 22, 2000 (the "Class
Period").
The lawsuit charges FRA and certain of its officers, with violations of the
federal securities laws by issuing materially false and misleading
financial statements. The Company, on May 22, 2000, revealed that it would
be restating its previously reported financial results for the first two
quarters of the fiscal year 2000. In total, losses for these two periods
were understated by more than $7 million. After the Company's announcement,
FRA shares fell to $2 9/16 per share from a high of $6 15/16 during the
class period, as the market fully absorbed the impact of these disclosures.
Contact: Berman, DeValerio & Pease LLP Julayne M. Lazar or Jeffrey C.
Block, Esq. (800) 516-9926 bdplaw@bermanesq.com
FLOORING AMERICA: Milberg Weiss Announces Securities Lawsuit in Georgia
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The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a
class action lawsuit was filed on June 15, 2000, on behalf of purchasers of
the securities of Flooring America, Inc., formerly known as the "Maxim
Group, Inc." (NYSE:FRA), between November 11, 1999 and May 22, 2000,
inclusive. A copy of the complaint filed in this action is available from
the Court, or can be viewed on Milberg Weiss' website at:
http://www.milberg.com/flooringamerica
The action, numbered 1:00-CV-1506, is pending in the United States District
Court for the Northern District of Georgia, Atlanta Division, against
defendants Flooring America, A. J. Nassar (the former President, and Chief
Executive Officer), Leonard H. Thill (Chief Financial Officer), and Stephen
P. Coburn (Principal Accounting Officer).
The complaint charges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder,
by issuing materially false and misleading financial statements. The
Company, on May 22, 2000, revealed that it would be restating its
previously reported financial results for the first two quarters of the
fiscal year 2000. In total, losses for these two periods were understated
by more than $7 million. After the Company's announcement, Flooring America
shares fell to $2 9/16 per share from a high of over $6 during the class
period, as the market fully absorbed the impact of these disclosures.
Contact: Steven G. Schulman or Samuel H. Rudman, Phone Number:
800/320-5081Kenneth J. Vianale or Maya S. Saxena Phone Number:
561/361-5000Email: FlooringCase@MilbergNY.com Website:
http://www.milberg.com
GUN MAKERS: Judge considers rejecting Gunfire accusations against Govt
----------------------------------------------------------------------
Accusations that government gunfire contributed to deaths at the end of the
fiery Branch Davidian siege may not be allowed in members' wrongful death
lawsuit, the presiding judge says.
The Davidians' lawyers have until next Friday June 23 to offer "any
additional evidence" to support their claim that repeated flashes on an FBI
infrared videotape recorded in 1993 came from government gunfire, the judge
ruled. U.S. District Judge Walter S. Smith Jr., citing the May report of a
court-appointed expert that the flashes came only from sunlight and heat
reflections, wrote this week that "the court is persuaded that the issue
... may best be resolved through summary judgment."
Government lawyers said they are now hopeful that Smith will dismiss
accusations that they have maintained are baseless and outrageous. "We
think that the evidence is overwhelming that there is no gunfire, that the
court-appointed experts confirm what was already very clear, and that a
summary judgment order should be granted," U.S. Attorney Michael Bradford
of Beaumont, a lead defense lawyer, told The Dallas Morning News.
Because the chief analyst for the British firm appointed by the court to
study the issue, David Oxlee of Vector Data Systems, was ill and
unavailable to testify until late summer, Smith planned to hear evidence at
a later date. Vector was retained at Waco special counsel John C.
Danforth's recommendation to help resolve the gunfire issue, assisting in a
March field test at Fort Hood.
Plaintiffs' lawyers objected Smith's ruling unfairly burdened them in
advance of next week's trial, before they could fully question the court's
experts. "We offered to go to London and take Mr. Oxlee's deposition so we
could present this issue to the jury," attorney Michael Caddell of Houston
said. "I find this order surprising and very strange, to suggest that this
issue could be decided on before we ever get to question him."
Smith has also ruled that just one example of each type of weapon owned by
the Branch Davidians can be introduced during the trial set starting June
19. Agreeing with a Davidians' attorney that a larger number could inflame
jurors, Smith moved to limit the weapons recovered from Mount Carmel seven
years ago that will be allowed into court.
The government may offer photographs of all the weapons recovered, Smith
said in the Waco-Tribune Herald.
Caddell, the lead plaintiffs' attorney, sought to limit the number of
weapons actually brought into the courtroom. He argued that the government
was attempting to inflame the jury.
Bradford argued during a June 12 pretrial hearing that jurors needed to see
all the weapons to understand why the FBI was reluctant to bring in
firefighting equipment.
A fire engulfed Mount Carmel on April 19, 1993 before Branch Davidian
leader David Koresh and some 80 of his followers died - some from the
blaze, others from gunshot wounds. Flames broke out six hours into a
tear-gassing operation designed to flush sect members out.
Smith stated in the order he issued that he doesn't expect the issue of
damages, if necessary, to be tried immediately after the close of the
liability phase of the wrongful-death lawsuit. Smith also partially granted
the government's motion to exclude the testimony of Jack Zimmerman, the
Houston attorney who represented Steve Schneider, Koresh's chief
lieutenant, during the siege.
Zimmerman, an ex-Marine, told reporters in 1993 that he saw bullet holes in
the roof and front door of Mount Carmel that he believed proved that the
government was the aggressor during the Bureau of Alcohol, Tobacco and
Firearms' raid on the Branch Davidians.
However, Smith ruled that Zimmerman did not have the background or training
to qualify him as a firearms expert in the analysis of bullet trajectory.
(The Associated Press State & Local Wire, June 16, 2000)
INDIAN VILLAGE: Ct OKs Manor Sale Suit Alleging Detroit Law Violation
---------------------------------------------------------------------
On January 17, 1998 the Farbman Group purchased the IVM, a luxurious old
(circa 1920) 74-unit apartment building overlooking the Detroit river
opposite Belle Isle Park, from the Art Centre Apartments Co. for 5.5
million dollars.
On September 9, 1997, Judge Simmons declared the IVM sale illegal because
it violated Detroit's Condo Conversion Ordinance.
On June 17, 2000 Wayne County Circuit Court Judge Louis F. Simmons Jr.
certified the Lawsuit as a Class Action.
The more than 70 persons who lived in the IVM on July 16, 1997 will have
the opportunity to purchase their apartments for $175,000.00 less their
current market value, or collect that amount in Damages.
Contact: Herman J. Anderson of Anderson, Anderson & Associates,
313-331-2964, or fax, 313-824-6015
INMATES LITIGATION: Sp Ct Reinstates Fed Law Limiting State Oversight
---------------------------------------------------------------------
The Supreme Court reinstated a key provision in a federal law aimed at
limiting federal court oversight of state prisons. The 5-4 decision Monday
in an Indiana case said Congress lawfully imposed a deadline for federal
judges considering state officials' requests that court monitoring and
supervision of prison conditions be ended.
Part of the Prison Litigation Reform Act of 1996 would automatically
suspend a federal judge's supervision of a state prison if he or she failed
to respond to such a state request within 90 days.
A federal appeals court said that provision violates the constitutionally
required separation of powers between the legislative and judicial branches
of government because it is ''a direct legislative suspension of a court
order.''
The Supreme Court disagreed. ''The PLRA does not deprive courts of their
adjudicatory role, but merely provides a new legal standard for relief and
encourages courts to apply that standard promptly,'' Justice Sandra Day
O'Connor wrote for the court.
Courts long have responded to inmate lawsuits over prison conditions by
ordering state officials to relieve those that violate some constitutional
right. Congress enacted the 1996 law out of its concern that federal courts
were intruding too far into state prison management. The law limits a
judge's power to order changes in conditions of confinement ''no further
than necessary to correct the violation of the federal right of a
particular plaintiff or plaintiffs.'' Under the law, remedies must be the
''least intrusive means necessary'' to correct any violation.
The Indiana dispute dates back to a 1975 class-action lawsuit filed in
behalf of inmates at the Pendleton Correctional Facility, which then was
called the Indiana Reformatory.
A federal judge in 1982 ordered prison authorities to make many changes and
the 7th U.S. Circuit Court of Appeals upheld his ruling. The appeals court
said Congress ''cannot take away the power of the court in a particular
case to preserve the status quo while it ponders these weighty issues.''
Indiana officials and the Clinton administration appealed to the Supreme
Court. The administration's lawyers argued that the 7th Circuit court
misinterpreted the law, which they said did not strip judges of the power
to ignore the 90-day deadline ''based on traditional equitable standards.''
The court on June 19 rejected the administration's interpretation. ''This
would be plainly contrary to Congress' intent in enacting the stay
provision,'' O'Connor said. She was joined by Chief Justice William H.
Rehnquist and Justices Antonin Scalia, Anthony M. Kennedy and Clarence
Thomas. Justices David H. Souter, Ruth Bader Ginsburg, Stephen G. Breyer
and John Paul Stevens dissented. The case is Duckworth vs. French, 99-224.
(AP Online, June 19, 2000)
PDB SPORTS: Broncos Season Ticket Holders Sue over Prices of 15 Years
---------------------------------------------------------------------
Denver Broncos season ticket holders have filed a class action lawsuit
against the team's owner alleging they were charged excessive ticket prices
over a 15-year period. Robert Heidrick, JoAnn Heidrick and Mike Kanderis
filed the class action lawsuit in Denver District Court against PDB Sports
Ltd., the owner of the Broncos, on behalf of themselves and other season
ticket holders.
They claim the Broncos violated a lease agreement with the city and county
of Denver for the use of Mile High Stadium by setting season ticket prices
above those found at other comparably sized NFL facilities without the
mayor's permission. They allege the Broncos consistently violated the
agreement from 1984 to 1999 and must now compensate season ticket holders
for the overcharges. According to the court documents, the Broncos contend
their ticket prices and administrative fees were not excessive and
therefore did not require the mayor's permission.
Season ticket prices jumped 25 percent from 1998 to 1999, but will stay the
same for the 2000 season, the Broncos' last at Mile High Stadium. Seats in
the South Stands sell for $25. That will climb to $50 when the new stadium
opens.
Notices are being sent this week to about 50,000 season ticket holders
informing them they may exclude themselves from the class. (The Associated
Press State & Local Wire, June 19, 2000)
PROFIT RECOVERY: Schiffrin & Barroway Files Securities Lawsuit in GA
--------------------------------------------------------------------
A class action lawsuit was filed in the United States District Court for
the Northern District of Georgia on behalf of all purchasers of the common
stock of Profit Recovery Group International, Inc. (Nasdaq: PRGX) from
February 16, 2000 through March 29, 2000 inclusive (the "Class Period").
The complaint charges Profit Recovery Group and certain of its officers and
directors with issuing materially false and misleading financial statements
for the Company's 1999 fiscal fourth quarter. Specifically, on March 29,
2000 Profit Recovery announced that it would restate its reported fourth
quarter financial results due to improperly recording revenue.
Contact: Schiffrin & Barroway, LLP Marc A. Topaz, Esq. Robert B. Weiser,
Esq. 888/299-7706 (toll free) or 610/667-7706 E-mail: info@sbclasslaw.com
PUROLATOR AIR: Restitution of Earned Wages Ruled As Appropriate Remedy
----------------------------------------------------------------------
The California Supreme Court affirmed a judgment, as modified, holding that
restitution of earned wages was an appropriate equitable remedy in an
unfair competition law action brought by an employee seeking unpaid
overtime wages.
Purolator Air Filtration Products Co. changed its workers' schedules from
five eight-hour days to four 10-hour days. Purolator failed to comply with
California Industrial Welfare Commission Wage Orders in implementing the
change, which subjected it to payment of overtime wages for the ninth and
10th hour worked each day.
Employee Rosalba Cortez sued Purolator for back overtime pay, and also
prosecuted an unfair competition law (UCL) claim seeking restitution of the
overtime wages withheld from other Purolator employees. Purolator moved to
strike the UCL claim on the grounds it required class certification. The
trial court denied the motion. The court later awarded Cortez her overtime
wages.
The court refused to award restitution on the UCL claim because Purolator
had converted back to a five-day schedule. Thus, the court reasoned, there
was no basis for injunctive relief.
Cortez appealed. In reply, Purolator conceded that injunctive relief is not
a prerequisite to restitution, but contended that the court's ruling was
valid because Cortez had no standing to bring the restitution claim because
it had to be brought as a class action. Purolator also argued that its good
faith and equitable defenses defeated the claim for restitution and that
Cortez was requesting damages rather than restitution.
The court of appeal affirmed in part and reversed in part, holding that the
trial court improperly denied the restitution sought in the UCL claim.
The appellate court ruled that Cortez did have standing to pursue the
restitution claim. Class certification was not necessary, given that the
method to calculate overtime for each employee was identical and the trial
court had all necessary information before it, including the identity of
the workers and their hours worked. Further, there was no possibility that
individual persons would pursue their own remedies, because the statute of
limitations had run. Given Purolator's failure to show that a class action
would have been advantageous, the court concluded that substantial evidence
supported the trial court's refusal to require class certification.
The court also determined that Purolator's good faith was irrelevant to the
UCL claim. Although unfair practices require the application of a balancing
test of harm versus benefits, the court noted that Purolator cited no
authority requiring a balancing as to unlawful business practices. A Labor
Code violation is an unlawful practice, the court observed. Furthermore,
the court stated that unlawful violation of a statute imposes strict
liability for which equitable defenses are not available.
The court rejected the contention that Cortez's UCL claim was for damages.
Cortez was not requesting compensation for any injury she suffered. Her
claim sought to force Purolator to disgorge its profit realized from
violating the law. The court observed that unpaid wages was one method by
which to measure the disgorgement of wrongful profit. The court also said
that restitution in this manner deters future violations.
The California Supreme Court affirmed, as modified, holding that unlawfully
withheld wages may be recovered as restitution in a UCL action.
The court observed that Bus. & Prof. Code @17203 provides that a trial
court hearing a UCL action may issue such orders or judgments "as may be
necessary to restore to any person in interest any money or property, real
or personal, which may have been acquired by means of such unfair
competition." The court declared that earned wages are as much the property
of the employee who has given his or her labor to the employer as is
property a person surrenders through an unfair business practice. The court
found that an order that earned wages be paid is thus a restitutionary
remedy authorized by the UCL.
The court acknowledged that the claims at issue might alternatively have
been framed as contract or tort claims seeking compensatory damages. The
court found, however, that it did not follow that an unpaid laborer could
not recover wages as restitution in a UCL action, when the failure to pay
wages violated the Lab. Code and thus constituted an unfair business
practice. The court noted that damages may often include such an element of
restitution, even though all damages are not restitution.
The court found that because @17203 authorized an order compelling
Purolator to pay back wages as a restitutionary remedy, it was unnecessary
to consider whether the order might be proper under the UCL on a
disgorgement of benefit theory.
The court found that although the equitable defenses proffered by Purolator
could not constitute a complete defense to Cortez's claim, because Cortez
sought equitable relief, the trial court may consider them in fashioning an
appropriate remedy.
The court rejected Purolator's statute of limitations argument as without
merit.
Justice Werdegar concurred in the judgment, but, for the reasons stated in
her concurrence and dissent in the companion case of Kraus v. Trinity
Management Services, Inc., she declined to join in much of the majority's
reasoning. Baxter, J., joined by George, C.J., and Mosk, Kennard, Chin, and
Brown, JJ.; Werdegar, J., concurring.
Counsel for petitioner Purolator Air Filtration Products Co.: Theresa M.
Marchlewski, Haight, Brown & Bonesteel, 1620 26th St., Ste. 4000 North,
Santa Monica, CA 90404-4013, 310-449-6000. Counsel for respondent Rosalba
Cortez: Cameron Cunningham, 2500 Vallejo St., Ste. 200, Santa Rosa, CA
95405, 707-523-3744 (Supreme Court Case No. S071934) (California Supreme
Court Service, June 9, 2000)
SCALAS: Husband and Wife Accountants under Grand Jury Investigation
-------------------------------------------------------------------
A husband-and-wife team of accountants from central Pennsylvania are the
subject of a federal grand jury investigation, possibly for bilking clients
out of tens of thousands of dollars, an Associated Press report says. Joe
and Debra Scala of Mifflinville also allegedly cheated the government out
of a half-million dollars in taxes, according to a study of court records
conducted by the Press Enterprise of Bloomsburg.
According to the Press, federal agents raided the couple's home on April 11
and removed nearly 20 boxes of paper records and files the FBI refuses to
say what those records were or why they were taken.
The Scalas spent 20 years in rural southeastern New York working as
accountants, although the state of New York has no record they were ever
licensed accountants there. They moved to Mifflinville, 40 miles southwest
of Scranton, in 1995, reports the Press.
Some of the couple's former clients in New York and Pennsylvania said they
are happy the Scalas are under investigation, the AP report goes on.
Several clients described themselves as naive investors who were duped out
of money by the couple. Some clients claim Joe and Debra Scala used
investment schemes to bilk them of tens of thousands and, in some cases,
hundreds of thousands dollars each. Some say the Scalas took their life
savings.
Dozens of individuals and businesses have sued the couple to recoup money
they claimed was owed them. So far, almost none have collected any money.
The former clients said Joe Scala talked them into investing in real estate
deals in Florida, New York and Pennsylvania. Some of the clients now allege
Joe Scala was actually tricking them and stealing their money.
"I had saved $140,000 with (the Scalas) over six years," said Michael
Maroon, 45, of Vails Gate, N.Y. "I had so much faith in Joseph that I
recommended him to my mother." Maroon said Joe Scala later refused to give
him tens of thousands of dollars of Maroon's own money. He said he is
convinced Scala stole it.
Kathy Laramee, 58, of Newburgh, claimed Joe Scala talked her into investing
with him in the late 1980s, after she received a $90,000 settlement from a
class-action lawsuit. Five years later, Laramee found that some of the
money was transferred to a money market account without her authorization,
she said. She was able to withdraw $60,000, but said she never recovered
another $25,000 she had given Scala for a business venture. "I'm ignorant.
I'm a dumb farmer," said Benjamin Trapani, 78, a former Scala accounting
client. "Scala put his hand on my shoulder. He said, 'I think the world of
you. I think of you like my father."'
Trapani said he gave Joe Scala his $80,000 life savings from his family
farm in Milton, N.Y., for an investment. "I didn't get a penny," Trapani
said.
The Scalas filed for bankruptcy in Pennsylvania on July 31, 1998. In their
bankruptcy filing, they report owing $1.5 million to 57 individuals,
couples and businesses. The couple failed to pay federal taxes from 1984 to
1993 and owe over $ 450,000, according to the Internal Revenue Service. In
addition, court records show they owe New York state over $60,000 for
unpaid state taxes from 1984 and 1985.
The Scalas are planning to hire a criminal defense lawyer to represent them
in the federal grand jury probe, according to papers filed in the
bankruptcy case. (The Associated Press State & Local Wire, June 19, 2000)
SIGMA DESIGNS: Hearing on Securities Complaints in CA Set for June
------------------------------------------------------------------
In February 1998, two putative class action complaints were filed against
the Company in the United States District Court, Northern District of
California, Romine et al. v. Sigma Designs, Inc., et al., No. C-98-0537-TEC
(N.D.Cal.) and Shah, et al. v. Sigma Designs, Inc. et al., No.
C-98-0582-MHP (N.D.Cal). The federal court consolidated complaint alleges
that Sigma Designs, Inc. and certain of its current and former officers
and/or directors issued false or misleading statements regarding the
Company's business prospects during the period October 24, 1995 through
February 13, 1997. The complaint does not specify the amount of damages
sought by the plaintiffs. On October 8, 1999, the Company filed a motion to
dismiss the consolidated complaint. In response to this motion, the
plaintiffs agreed and filed a second amended complaint. On April 21, 2000,
the Company filed a motion to dismiss the second amended complaint. The
hearing on that motion is scheduled for June 26, 2000. The Company believes
that it has meritorious defenses to the allegations made in the complaints
and intends to conduct virgorous defense.
SWEATSHOPS: Activists Put Regis Philbin Clothing Line on The Line
-----------------------------------------------------------------
First it was Kathie Lee and sweatshops. And now Regis? Labor activists last
Friday June 16 put Regis Philbin's new clothing line on the line - by
charging that the "Who Wants to be a Millionaire" host has put his name on
shirts made by a company with a history of production at abusive foreign
factories.
Philbin, who also co-hosts a television show with Kathie Lee Gifford,
appeared at Macy's earlier this week to introduce a shirt and tie line
called "Regis by the Van Heusen Company."
Last Friday, members of the UNITE garment workers' union walked into Macy's
blowing whistles and handing out leaflets that read: "Sweatshops for
Father's Day? Shame!" - near a display of the $77.50 cotton shirt and satin
tie ensembles that have become Philbin's trademark attire. "We're giving
him a chance not to put his name on clothing made by a company with ties to
labor abuses," said UNITE spokeswoman Jo-Ann Mort, adding that Philbin
needs to ensure that the new line of Regis ensembles are not made under
sweatshop conditions.
Phillips-Van Heusen produces many of their clothes in overseas plants. Last
year, the New York-based manufacturer was named in a class-action lawsuit
claiming that workers on the Pacific island of Saipan manufactured clothes
under sweatshop conditions. The company, and other garment makers, promised
to establish a fund to finance an independent monitoring program and
provide money to the workers.
And in 1998, Phillips-Van Heusen closed a plant in Guatemala after workers
won a years-long struggle for a new union contract. Philbin's television
partner, Gifford, has for years faced charges that her clothing line was
produced in sweatshops. While the criticism persisted, she hired monitors
and joined a national task force that acts as a watchdog for labor
conditions. (The Associated Press State & Local Wire, June 16, 2000)
* Australian Paper's Views on Internet Disability Friendliness
--------------------------------------------------------------
The Human Rights and Equal Opportunity Commission report on e-commerce,
Accessibility of Electronic Commerce and New Service and Information
Technologies for Older Australians and People with a Disability, recommends
that the Internet industry pay greater attention to the needs of the
elderly and people with disabilities.
According to Deputy Disability Discrimination Commissioner Graeme Innes,
the digital divide that excludes disabled people could be narrowed by a
better understanding of the needs of disabled Internet users.
According to Internet Industry Association executive director Mr Coroneos,
the latest W3C guidelines published earlier this year (see www.W3C. org)
outline measures that can be used by site designers to make their websites
more 'disability friendly'.
Measures recommended in the guidelines include using optional text in place
of complex graphics, avoiding colour schemes that are confusing to
colour-blind users, coding text in HTML in addition to '.pdf' format (which
many text-to-speech software converters cannot interpret). These measures
are generally quick and easy to implement and enable many more people to
use the information.
Mr Coroneos concludes that this not only makes good commercial sense but
could help avoid the type of court action seen in the US, in which blind
Internet users have sued for a failure to provide Internet access that
satisfies their needs. Highlighting the plight of those with disabilities
is a good thing because it draws attention to the need for inclusion.
Likely to be less accurate is Mr Coroneos's inference that the Australian
Internet industry should fear a rash of US-style litigation launched by
disabled and elderly Internet users.
For a start, the US legal regime is much different.
The US has contingency-fees arrangements that make it easier to sue and
give greater incentives to bringing class actions a phenomenon that is also
more common in the US. In the US, each party usually pays its own costs,
whereas in Australia the losing party is liable to pay the winner's costs.
Also, plaintiffs in the US have access to a US Constitutional Bill of
Rights and a long line of precedents that can often be used in support of
such areas as discrimination. It is also easier for groups such as the
disabled and environmental groups to obtain 'standing' to appear before US
Courts. The US culture is more litigious and lobby groups for the elderly
and disabled have recourse to a more liberal Freedom of Information Act and
other statutory remedies not as readily available in Australia. At the same
time, for political reasons of its own, Australia has been sensitive to
reducing the gap between the technology 'haves' and 'have-nots'.
Universal-service obligations and recent grants, government support and
other schemes have placed considerable stress on servicing regional
Australia.
Although Australia has room for improvement in giving access to disabled
and elderly Internet users, there is no need press the panic button and
predict that there will be a wave of US-style litigation.
The fact is that Australia has made and continues to make significant gains
in this area and is a world leader in the promotion of e-commerce and its
use by government.
Eugene Clark is part of the Technology Law Group of the National Centre for
Corporate Law and Policy Research, University of Canberra. eec@management.
(The Canberra Times, June 19, 2000)
* Senate Judiciary Postpones Action on Internet Privacy Bill
------------------------------------------------------------
CQ (6/15, Fagan) reported, "The Senate Judiciary Committee postponed action
[last Thursday June 15] on an Internet privacy bill (S 2448) and a measure
that would shift many class action lawsuits to federal court (S 353), but
panel Chairman Orrin G. Hatch, R-Utah, outlined an ambitious schedule for
the next two weeks. " Hatch also "pledged to take up the class action
measure, despite a threatened veto. It is designed to prevent abuse of the
system but critics say it would only cause massive delays in federal
courts." There are "16 amendments pending on the Internet privacy bill and
Hatch said he hopes to reach agreement and move the bill before the July
4th recess. Hatch promised ranking Democrat Patrick J. Leahy, Vt., a markup
soon on a bill (S 2413) to provide more bulletproof vests to law
enforcement." (The Bulletin's Frontrunner, June 16, 2000)
* US and UK Open Talks on 1994 Treaty; UK Firms May Be Targets of Suits
-----------------------------------------------------------------------
The British and US governments have opened talks on using a 1994 treaty,
designed to combat drug barons and other international criminals, to crack
down on cartels.
Depending on the outcome of the talks, information about UK companies might
in future be forwarded to the US Department of Justice, raising concerns
that they could be targeted in costly class actions. "The approach is all
very well, but we need proper safeguards," said Christopher Bright, head of
European competition and regulation at Clifford Chance, the law firm.
Any information that emerged in the US courts as a result of the proposed
arrangement could render UK companies vulnerable to punitive damages of the
type being sought in the expanded law suit filed last week against
Microsoft. Mr Bright said information on UK companies could be released
into a legal system that allowed payment of triple damages.
The 1994 agreement on mutual legal assistance in criminal matters
explicitly excludes antitrust matters. But the UK and US governments are
discussing a side letter that would allow certain competition issues to be
brought within its scope.
The UK places tight restrictions on help that can be given to overseas
competition regulators in relation to British companies. The Competition
Act, which came into force this year, forbids the disclosure of
commercially sensitive information without the consent of the company
concerned.
Overseas regulators can apply for access to information gathered by the UK
competition watchdogs, but this is subject to ministerial approval and
court agreement. This power has never been used.
Stephen Byers, trade and industry secretary, said in February he wanted to
explore ways of co-operating more fully with overseas regulators on
antitrust issues. Any move in that direction would be welcomed by the UK
competition watchdogs who believe it would be "sending the right signal" to
the US.
Margaret Bloom, director of competition policy at the Office of Fair
Trading, said any increase in the ability to work with the Department of
Justice would be welcome. "Cartels can co-operate very comfortably
internationally, but there are too many restrictions on the ability of the
competition authorities to co-operate. Consumers would benefit from lower
prices if we could knock out more cartels".
The fact that the talks are happening at all "shows how earnest this
government is about competition policy," Mr Bright said. (Financial Times
(London), June 19, 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
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Information contained herein is obtained from sources believed to be
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