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/raid1/www/Hosts/bankrupt/CAR_Public/000818.MBX C L A S S A C T I O N R E P O R T E R Friday, August 18, 2000, Vol. 2, No. 161 Headlines ACRODYNE COMMUNICATIONS: Berman DeValerio Files Securities Suit in MD APPONLINE.COM, INC: Cauley & Geller Files Securities Lawsuit in New York AUTO INSURANCE: Generic Parts Supplier Sues Plaintiff in State Farm Case BOOK SELLERS: Duped Buyers Sue over Mc Nally Mystery and Ghost Writers BRIDGESTONE, FORD: Milberg Weiss Files Consumers' Suit in Florida BRIDGESTONE/FIRESTONE: Consumers Request a Jury Trial in Philadelphia FMC CORPORATION: Sued for Employment Race Discrimination IMATION CORP: Lionel Z. Glancy Amends Securities Complaint in CA KEANE INC: Iowa Hospitals Denied Cert. in Suit Against Software Co. PMI MORTGAGE: Announces Dismissal of RESPA Lawsuit in Georgia POTASH CORPORATION: Consumers Appeal in Potash Price-Fixing Case QWEST: Asks CO Court to Limit Discovery over Alleged Deceptive Practice REDLANDS CONTAMINATION: Review Petitioned on Rule on Lack of Commonality REPUBLIC SERVICES: Securities Suit in FL Recently Consolidated RYLAND GROUP: Residents Vote to Pay for Sinkhole Repairs SOUTHWESTERN BELL: Customers Say Connect Times Slowed to Increase Sales SPORTS CLUB: CA Suit Says Attractive Women Get Preferential Discounts TENFOLD CORP: Berman, DeValerio Files Securities Fraud Suit in Utah TOBACCO LITIGATION: Lawyers Say Firms Should Be Fined for Changing Venue WONDER BREAD: Jury Hits Bakery with $ 132 Million Punitive Damages * Group Says Blacks Not Getting Senior Government Jobs ********* ACRODYNE COMMUNICATIONS: Berman DeValerio Files Securities Suit in MD ---------------------------------------------------------------------Acrodyne Communications, Inc. (Nasdaq: ACRO) was named as a defendant in a shareholder class action lawsuit filed in the United States District Court for the District of Maryland. The action, brought by Berman, DeValerio & Pease, LLP, www.bermanesq.com, seek damages for violations of the federal securities laws on behalf of all investors who purchased Acrodyne common stock between May 18, 1999 and August 14, 2000 (the "Class Period"). The complaint alleges Acrodyne and certain of its current and former officers with violations of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. In particular, the Complaint claims that Acrodyne improperly overstated its inventory and gross profits during the Class Period, which will require the Company to amend and restate its 1999 year-end results and its results for first quarter ended March 31, 2000. On August 14, 2000, the Company issued a press release announcing that that it would delay the filing the Company's Form 10-Q for the quarter ended June 30, The Company also disclosed that it planned to amend and restate its financial results for 1999 and the first quarter of 2000, and that it would engage an independent accounting firm for the purpose of conducting a full review of the inventory balances and related activity to determine the extent of any amendment and restatement. As a result of these revelations, Acrodyne's stock price tumbled approximately 37% on August 14, 2000, until Nasdaq halted trading. As of the date of this release, trading has not resumed. Contact: Patrick T. Egan, Esq. of Berman, DeValerio & Pease LLP, 800-516-9926, bdplaw@bermanesq.com APPONLINE.COM, INC: Cauley & Geller Files Securities Lawsuit in New York ------------------------------------------------------------------------ The Law Firm of Cauley & Geller, LLP announced on August 16 that it has filed a class action lawsuit in the United States District Court for the Eastern District of New York on behalf of all individuals and institutional investors that purchased the common stock of AppOnline.com, Inc. (AMEX:AOP)(OTCBB:IMNF)(OTCBB:APLY) (OTCBB:AOPL) between June 1, 1999 and June 30, 2000, inclusive (the "Class Period"). The Complaint was filed against several of the officers and directors of AppOnline, a company that, until it filed for bankruptcy protection on July 19, 2000, was engaged, through its subsidiaries, in the mortgage banking and mortgage brokerage services business. The Complaint alleges that certain of the Company's officers and directors violated the federal securities laws by providing materially false and misleading information about the Company's business, operations and financial condition and by siphoning off Company money and violating banking rules and regulations. In particular, the complaint alleges that throughout the Class Period, the defendants made false statements about the Company's financial results and misleadingly touted AppOnline's goal of becoming "a dominant player in the growing online home mortgage business." As a result of these false and misleading statements, the Company's stock traded at artificially inflated prices during the class period. On May 24, 2000, after nearly a year of positive news had been issued by the Company, Newsday reported that Island Mortgage Network, Inc., a subsidiary of AppOnline, was fined by the FHA for making loans that did not comply with FHA standards, based on allegedly false documentation and incomplete or incorrect information. On June 30, 2000, New York State Banking Regulators suspended Island's banking license for allegedly making loans it could not fund and refusing to allow regulators access to its files. On August 14, 2000, AppOnline stock closed at $0.08 per share, down 98.5% from a class period high of $5.50. Trading of AppOnline was then halted Contact: Cauley & Geller, LLP, Boca Raton Sue Null, Jackie Addison or Sharon Jackson Toll Free: 1-888-551-9944 E-mail: Cauleypa@aol.com AUTO INSURANCE: Generic Parts Supplier Sues Plaintiff in State Farm Case ------------------------------------------------------------------------ Scot Hansen says an Illinois court decision against State Farm Insurance has cost his Fresno business about $1million in the past 10 months. Hansen's business, Collision Parts Network, sells generic auto parts for insurance company repairs. An Illinois jury found last October that State Farm knowingly used inferior generic parts in repairing insured vehicles and awarded plaintiffs more than a billion dollars. Though Hansen was not part of that lawsuit, State Farm and other major insurers have stopped using parts supplied by generic parts suppliers, including Hansen, since the trial. Hansen contends his generic parts are as good as original parts. He has filed a lawsuit against Michael Avery, lead plaintiff in last year's case against State Farm. Hansen's case, the first by a generic parts supplier since the State Farm verdict, was filed July 29 in Fresno County Superior Court and may have nationwide implications. In the lawsuit, Hansen wants compensation for his financial losses. The State Farm ruling has had a chilling effect on the 250 generic parts sellers in the United States. The $1.5 billion industry has lost 20% of its business since the October verdict, said Stan Rodman, executive director of the Houston-based Automotive Body Parts Association. Rodman's organization is raising money to help Hansen with legal costs. "For some of our members, it was quite disastrous," Rodman said. Generic or "aftermarket" auto parts that Hansen sells are independently produced parts by manufacturers with no ties to automakers. Some producers of generic parts also produce parts for major automakers. Generic parts are viewed as a less expensive alternative -- sometimes 50% less costly -- to higher-priced original-equipment parts. The case against State Farm claimed that parts sold by generic distributors were not of "like kind and quality" as original components. Parts targeted in the State Farm lawsuit were fenders, hoods, bumpers, headlights and signal lights. With losses of 50% in insurance-related sales and a 25% dip from last year's $3.5 million in revenue, Hansen has been forced to cut 15 of 30 jobs in his company. Collision Parts Network has satellite warehouses in Pico Rivera, West Sacramento and San Leandro. He said the lawsuit is his effort to defend the integrity of his industry. "Most of what we sell is manufactured by independent producers who build for original-equipment manufacturers as well. I am not saying the same product that runs off the presses for original-equipment manufacturers is the same product we get as well, but in some cases that is true." Hansen's lawyer, Ron Katz of San Francisco, said the State Farm verdict is being challenged because it was reached in an Illinois courtroom and should apply only to Illinois motorists and companies operating there. "Mr. Avery purports to represent a million Californians without our notice and without our consent," Katz said. "Mr. Avery lives in Louisiana, he brought a lawsuit in Illinois, and said he represents millions of people around the country. Now he is putting a man out of business in Fresno. It's absurd." But Chicago-based lawyer Michael B. Hyman, who represents Avery, calls Hansen's case "ridiculous." State Farm was not adhering to standards it sets in its own policies across the country, he said. "State Farm dictates from [its headquarters in] Bloomington, Ill., how its adjusters operate from California to Maine," Hyman said. "It's a uniform practice perpetrated by State Farm. ... We proved the parts being used by State Farm were not of 'like kind and quality.' One of State Farm's witnesses said 90% of aftermarket parts are inferior." The Illinois verdict awarded Avery and 4 million other plaintiffs $1.2 billion. How the money will be divided has not been determined and will depend upon the outcome of State Farm's appeal, Hyman said. Morris Ratner, a San Francisco lawyer representing Avery, described Hansen's suit as "retaliatory." "It clearly has no basis in law," Ratner said. "Big insurance companies or their allies cannot, and will not, intimidate consumers." Hansen and Katz say they have no connection to the insurance industry and do not plan to assist State Farm in its appeal. "What they want to talk about is State Farm, and what we want to talk about is freedom of choice," Katz said. "Maybe State Farm did something wrong and maybe they didn't; that has nothing has nothing to do with Scot [Hansen]. A state case in Marion, Ill., is affecting your rights right now. We think that proceeding was illegitimate and there is no reason why it should affect a California business." Katz's contention is similar to one voiced by State Farm officials. "One of the arguments we have made in response to the decision in the Avery case is a judge and jury in one state should not be able to prohibit a practice that is perfectly legal in other states," said Dick Luedke, a State Farm spokesman in Bloomington, Ill. "We don't feel it's appropriate a single county jury dictates practices to other states. Our position is if that's the case, this belongs in a federal courtroom." For its part, State Farm does not plan to file a brief supporting Hansen's case. "We want to know a little bit more about where the case is headed," Luedke said. Some Valley parts and body shop operators say generic parts are inferior. "The thickness of the metal is not as good as the original, the fit is not as good," said Joe Davis, parts manager of Hedrick's Hallo-well Chevrolet. "In some cases you cannot make it fit properly." As a policy, his dealership informs customers about differences between original equipment and generic parts. "It used to be where [insurers] came in and said you had to use [generic parts]. You didn't have a choice," Davis said. "We were handcuffed: The insurance company dictated what we used.... On a new vehicle, it should never happen, because it does affect the warranty for GM products. It's a product-quality issue, it's just not like the original." Since the State Farm verdict, Davis has noticed a difference in insurers: "There is definitely a turnaround with the insurance companies. I can't say it's 100%, but it's definitely a change." Bruce Williams, who owns a Clovis auto body shop, agreed with Davis. Use of generic parts "has been cut way back," he said. "State Farm won't use any, and there are very, very few using it." Williams said many generic products were not of high quality. Nevertheless, he said, there are times when generic parts should be used, such as when a car will be junked because an owner can't afford original equipment. Additionally, Williams said generic parts allow him to increase his profit because they are less expensive. But, he said, if generic products don't fit properly, lengthier repairs and higher costs for insurance companies paying for policyholders' rentals will result. Consumer Reports tests in 1999 compared generic fenders and bumpers against original equipment. The magazine found original-equipment fenders and bumpers were superior. But beyond fenders and bumpers, many generic parts are as good as original equipment, said John Loftus, Tustin-based executive director for the Society of Collision Repair Specialists. "It's an inconsistent situation in repairs. You can get two good parts and then get two bad ones. That's the problem our folks have," said Loftus, who represents 9,000 collision-repair shop owners. "If your objective is to buy a cheap part, you will probably have some problems." Without competition from generic parts manufacturers, Loftus said, automakers could raise parts prices. During the next few years, Rodman, of the Automotive Body Parts Association, predicts drivers will see those higher prices in the costs of parts and auto insurance if the State Farm verdict stands. "The insurance industry will say, 'If we are hit with higher costs, then we have to pass them on,'" Rodman said. "About 85% of motorists will not get into accidents and they will subsidize the 15% who do. Joe Motorist, who has driven 10 years and never put in a claim, will see a premium increase." (The Fresno Bee, August 16, 2000) BOOK SELLERS: Duped Buyers Sue over Mc Nally Mystery and Ghost Writers ---------------------------------------------------------------------- Old mystery writers never die; they just become "ghost writers." In a class-action lawsuit, fans of the late whodunit writer Lawrence Sanders claim they were duped into buying a book he didn't write when the publishers hired a ghost writer to continue his popular Archy McNally detective series with McNally's Dilemma. The suit alleges that Penguin Putnam Inc. and G.P. Putnam's Sons "have wrongfully represented McNally's Dilemma as a Lawrence Sanders novel in order to reap financial benefits from associating the novel with the Lawrence Sanders name. "Also named as a defendant is Amazon.com Inc., the Internet bookseller, for allegedly falsely touting the book as veritable Sanders verse on its Web site. Attorneys Alan M. Feldman and Thomas More Marrone of Feldman Shepherd Wohlgelernter & Tanner filed the suit in Philadelphia Common Pleas Court on behalf of Margaret Kelly of Melrose Park and a class of Pennsylvania consumers who, like Kelly, purchased the book unaware that its true author was Vincent Lardo.The suit cites claims under the Pennsylvania Unfair Trade Practice and Consumer Protection Law and false advertising. According to the suit, Sanders was a well-known and prolific author. Between 1968 and 1998 when he died at the age of 78 Sanders wrote 34 novels, and 18 short stories and novellas. His shorter works have been published in three collections, and two of his novels have been made into feature-length movies. In 1992, Sanders introduced the character Archibald "Archy" McNally, a private investigator who was featured in seven novels McNally's Secret and McNally's Luck, both in 1992; McNally's Risk in 1993; McNally's Caper in 1994; McNally's Trial in 1995; McNally's Puzzle in 1996; and McNally's Gamble in 1997. After Sanders died, the suit says, Putnam published McNally's Dilemma and "represented [it] to be authored by 'Lawrence Sanders'.""This misrepresentation is set forth on the dust jacket to the book ... is repeated on the spine of the hardback copy of the book ... [and] was also set forth on the cover page to the book," the suit says.Kelly says she bought the book in December 1999 from Amazon.com for $ 22.45. The company's Web page, she says, "misrepresented that the book was 'by Lawrence Sanders'." The suit says McNally's Dilemma "immediately joined the ranks of the Publisher's Weekly hardcover fiction best seller's list."Feldman and Marrone argue that "the misrepresentations actually deceived and continue to deceive, or had a tendency to deceive, and continue to have a tendency to deceive, a substantial segment of its audience, i.e, the book purchasing public." Fans appear to be divided on the issue, however.At the Amazon.com Web site, the "customer reviews" of McNally's Dilemma, ghost writer Lardo is lauded by some for capturing the spirit of Sanders' character, but chided by others for failing to get the details right. An AudioFile thumbnail sketch of the book's plot tops the Web page: "Palm Beach private investigator Archy McNally takes on the murder of a socialite and uncovers a thorny tangle of blackmail and deceit, south Florida style. Playboy Geoffrey Williams is dead. But it's not a search for the killer that brings Archy McNally to the case; the lovely Melva Williams readily admits to the crime passionnel. After finding Geoff in a precarious position with an attractive young lady, she pulled the trigger on husband number two. ..."One customer wrote: "I thoroughly enjoyed McNally's Dilemma, even if it wasn't written by the great Lawrence Sanders." But later in the same review, the fan seemed to capture the sentiment of the lawsuit, saying " I do agree that the publisher (G.P Putnam's Sons) should have used Vincent Lardo's name on the cover ... with characters created by Lawrence Sanders or similar wording." However, she may be one of the class-action opt-outs, because she also wrote: "I did not feel cheated, as I closely read all credits and acknowledgments before I start to read any book anyway. I thought Mr. Lardo captured the free-spirit of Archy beautifully. Like all of the Archy series, it was a fun read. I do hope Putnam publishes more in the series, but give the real author, Vincent Lardo, the credit." Another customer-reviewer was less sanguine: "I bought this book not knowing that Saunders had died however felt something lacking as I went along. So looked it up with Amazon and now I know what is wrong with the wonderful 'Archy.' He is not as funny and flamboyant as in the past O.K. but no cigar! ... Maybe our new author will reread some of the past books and pick up more of Archy's funny ways." (The Legal Intelligencer, August 16, 2000) BRIDGESTONE, FORD: Milberg Weiss Files Consumers' Suit in Florida ----------------------------------------------------------------- Law firm Milberg Weiss Bershad Hynes Lerach LLP said a class action lawsuit has been filed against Bridgestone-Firestone Inc and Ford Motor Co on behalf of consumers in Florida who bought replacement tires to provide against possible injury from defects in Firestone's ATX, ATX II and Wilderness AT tires. The class action was filed in Palm Beach County and seeks recovery on behalf of Florida consumers who replaced their Firestone tires, and who are not covered by Firestone's recall, the firm said. Milberg Weiss said Firestone announced it would reimburse consumers who replaced their Firestone tires between Aug 9-16 2000, and this recall leaves numerous Floridians without reimbursement. (AFX - Asia, August 17, 2000) BRIDGESTONE/FIRESTONE: Consumers Request a Jury Trial in Philadelphia --------------------------------------------------------------------- Local attorneys allege unfair trade, seek punitives. Attorneys have filed what appears to be the first local class action against Bridgestone/Firestone Inc. and the Ford Motor Co. in Lennon v. Bridgestone/Firestone Inc. The plaintiffs have requested a jury trial. "When the news [of problems with Firestone tires] first hit, people started calling," said attorney Robert W. Sink of Fort Washington, lead counsel in the case. He filed the class action Aug. 10 in Philadelphia Common Pleas Court, just one day after Bridgestone/Firestone announced a recall of its ATX, ATXII and Wilderness AT tires. The tires are currently being investigated by the National Highway Traffic Safety Administration. According to wire reports, the tires were reportedly involved in more than 300 accidents due to tire failure, which caused the deaths of at least 46 people. Most of those crashes involved Ford Explorer sport utility vehicles which sustained tire blowouts caused by treads separating from the tires at high heat. The representative plaintiffs, Pete Lennon of Broomall and Judith Donnelly of Media, both own Ford Explorers.In addition to Sink, three other attorneys are working on the case: Kenneth A. Jacobsen and Robert T. Gibson of Media, along with Francis J. Farina of Devon. All are solo practitioners.In a total of four counts against Bridgestone/Firestone and the Ford Motor Co. jointly, the plaintiffs allege both Bridgestone and Ford violated the Unfair Trade Practices and Consumer Protection Law by misrepresenting the tires as "safe" when they knew or should have known the tires had safety defects. The complaint references an internal memo at Ford dated Oct. 11, 1996, which refers to a "quality issue with the Firestone Wilderness AT P235 tires built at their Wilson Plant," and which "cited vibration problems" with the Firestone tires.The complaint in Lennon further alleges the defendants violated the Uniform Commercial Code by breach of the warranties of merchantability and fitness for a particular purpose. Slow Recall Sink termed "outrageous" what he sees as the continuing failure of Bridgestone/Firestone to immediately remedy many unsafe tires still on the road. The recall announced Aug. 9 does not cover the entire country, but rather is a slow, three-step process that could result in more accidents and deaths, he said."They said they plan to do the southern states first, then the Midwest, and then the northern states. The rationale behind the southern states is that they perceive more risk there, because of the heat," he said."But meanwhile, people here are still driving around on unsafe tires."Details of the staggered recall were not outlined in the complaint because they were released in the news media after it was filed, Sink said. South Carolina Attorney General Charlie Condon filed suit Monday against Bridgestone/Firestone, also claiming violation of that state's Unfair Trade Practices Act because of the plan to stagger the recall. The Associated Press reported other attorneys general are considering lawsuits as well, including those in Ohio, New York, North Carolina and Nevada. Several plaintiffs law firms around the country have also filed consumer class action suits in Florida, Maryland and Tennessee. Damages The plaintiffs in the Philadelphia suit seek joint and several liability for compensatory and punitive damages against Bridgestone/Firestone and Ford, injunctive relief to stop the companies from continuing to sell the tires, and attorneys fees and costs.Pursuant to statute, the plaintiffs seek treble damages on their actual losses, or $ 100, whichever is higher. Since there is no cap on punitive damages, Sink said he could not predict a dollar amount for them. "Hopefully, they will be sufficient to deter Ford and Firestone from gambling with peoples' lives," he said.An initial status conference is scheduled for Sept. 11 before Administrative Judge John W. Herron. (The Legal Intelligencer, August 16, 2000) FMC CORPORATION: Sued for Employment Race Discrimination -------------------------------------------------------- The following was released on August 17 by Sprenger & Lang: Eleven current and former employees of FMC Corporation brought suit on behalf of a potential class of all African American employees in FMC's chemical manufacturing divisions alleging that the company has discriminated against them because of their race in promotions, salary and terminations, and that it has created a racially hostile work environment and retaliated against African American employees who spoke up about the need for diversity in the workplace. These plaintiffs allege that they represent a class of approximately 500 former, current, and future African American employees at FMC in its three chemical divisions. The suit contends that FMC's actions have created a "glass ceiling" that restricts the advancement of African-Americans to executive level positions, that FMC's salary system routinely allows white managers to pay African-American managers less for the same work, that African-Americans are terminated in vastly disproportionate numbers than similarly situated white employees, for reasons that are often plainly false. All of these actions occur in an environment where terms like "nigger" and references to the KKK and cross burning occur, and where any actions taken to try to enforce equal rights are punished harshly. Internal FMC documents acknowledge the "glass ceiling" that forms a barrier to advancement at FMC. CEO Robert Burt stated in a September 1999 memorandum that "representation of Black managers has declined" since 1989. In fact, FMC has only one African American corporate vice-president. In addition, many African Americans have fled the racially hostile conditions at FMC. As of December 1998, FMC retained 93.5% of white males in supervisory positions, but only 78.6% of all racial minorities, and even fewer African Americans. Despite knowledge of the problem at the highest levels of the corporation, FMC has knowingly tolerated unjustifiable abuses. For example: * Plaintiff Quentis Rogers has worked at FMC since 1982. He has two Master's degrees, one in education and one in business administration. In 1990, Rogers volunteered to become the liaison between minority leadership and senior management, which he did for two years. Rogers' career has stalled to a near-standstill since then in retaliation for his commitment to diversity. * Plaintiff Sheila Williams worked at FMC for nine years, earning a Bachelor's degree at night, before she was promoted to an "exempt" (i.e., salaried) position even though, for years, she was at a grade 6 while performing a job on an "acting basis" that previously was held by a grade 19. Williams applied for ten promotions with FMC over a two-year period, and did not get a single one. She suffered such stress as a result of FMC's treatment of her that her hair fell out. * Plaintiff Arnold Ramsey was forced for over a year to document his every move at work to refute his supervisor's baseless accusations about his job performance. In addition, the word "nigger" was used in his presence. * Plaintiff Kelly Eubanks was told by a co-worker: "I hope you go home and have a cross from the KKK or skinheads on your lawn burning." * Plaintiff James Clifton's employment was terminated allegedly as the result of a joint venture resulting in the elimination of his job. However, a job vacancy describing his former position was posted within two months of his termination. * When Plaintiff Melvina Cannon, chair of the employee Minority Council, sought a sales position, she was told that she was "perfect" for a position as a telemarketer, far below her skill and experience levels. These are only a few examples of the conduct alleged in the Complaint. "In example after example, proud, competent, hard-working people who sought only to be treated the same as their non-African American co-workers were damaged emotionally and physically by FMC's callous indifference to the basic principle of equality," says Jennifer Jaff of Sprenger & Lang. FMC Corporation is one of the world's largest producers of chemicals and machinery for industry and agriculture. Its chemical products are incorporated into many well-known consumer goods, including Slimfast, Calgon, Mentadent and Pepcid. It also constructs machinery that people around the world use every day, such as the majority of retracting walkways that extend from airport terminals to planes. FMC operates more than 100 manufacturing facilities and mines in 25 countries. The eleven named plaintiffs worked in FMC locations in Philadelphia, Chicago, Princeton, and Charlotte, North Carolina. FMC has a number of contracts with the United States government. According to Lawrence Schaefer of Sprenger & Lang, "no employee in the year 2000 -- especially working for a company as large as FMC -- should be treated the way African Americans at FMC have been treated. Their complaints have been ignored and, even worse, dismissed as insignificant. This conduct cannot be permitted to go unchecked." For the plaintiffs, just filing the lawsuit is a relief. "Today, we take an important step towards reclaiming our pride and self-esteem, not only for ourselves, but for all the African Americans who work at FMC, now and in the future," said Plaintiff Quentis Rogers. The action is filed by Sprenger & Lang, one of the country's foremost class action employment discrimination law firms, with the assistance of Chicago attorney L. Steven Platt of the firm of Arnold & Kadjan. The principal attorneys on this case are Jennifer C. Jaff, of Sprenger & Lang's Washington, D.C. office, and Lawrence Schaefer, of Sprenger & Lang's Minneapolis, Minn. office. Any requests for the Complaint should go to Jennifer Jaff at 202-265-8010 or 301-524-7865 (cellular). Contact: Jennifer C. Jaff, Esq., 202-265-8010, 301-524-7865 cellular, or Lawrence Schaefer, Esq., 612-871-9810, both of Sprenger & Lang, PLLC IMATION CORP: Lionel Z. Glancy Amends Securities Complaint in CA ---------------------------------------------------------------- A class action lawsuit against Imation Corp. (NYSE:IMN) and various affiliated individuals, based on their violations of the Federal securities laws, has been commenced by the filing of a first amended complaint in the United States District Court for the Northern District of California, San Jose Division, asserting claims on behalf of thirty-nine (39) named plaintiffs and a putative Class, consisting of all employees or consultants of Cemax-Icon, a company based in Fremont, California, who had purchased or otherwise acquired Imation stock options -- by substitution in exchange for their pre-existing Cemax-Icon employee stock options (the "substitute options") and/or by the original grant of new Imation options (the "new options") -- in connection with Imation's acquisition, in and about May through August 15, 1997, of Cemax-Icon, including without limitation all such persons that so purchased or otherwise acquired such options pursuant or traceable to the Registration Statements(s) and Prospectus(es) issued and any oral communications made by Defendants in connection with such substitution and/or original grant, and were damaged thereby (the "Class Members"). The complaint alleges that in violation of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, the Defendants harmed these Class Members by materially overstating the underlying value of Imation's common stock in structuring the aforementioned employee stock option transactions. In addition, by misleading these Class Members as to the ultimate shelf-life and the terms and extent of the exercisability of the various aforementioned Imation stock options, the Defendants also materially overstated to these Class Members the underlying value of and Imation's consideration for the respective stock option agreements and grants. The Complaint further alleges that Defendants wrongfully extinguished and abrogated the Class Members' individual entitlement to their respective substitute options and new options in the course of Imation's sale of Cemax-Icon, along with Imation's worldwide Medical Imaging Systems business, to the Eastman-Kodak Company ("Kodak") (the "Imation-Kodak deal"). In connection with this sale, Imation informed the Class Members that they were being transferred en masse to Kodak without any interruption or termination of their employment status at Cemax-Icon whatsoever. Despite taking that position, Imation informed the Class Members, nonetheless, that they would have a thirty (30)-day deadline to exercise their substitute options at the risk of forfeiting them and that those substitute options that had not yet vested were, indeed, already deemed by Imation to have been forfeited. Moreover, Imation adopted the position that the new options -- none of which, as structured, would have become exercisable until January, 1999 (that is, well after the Imation-Kodak deal was expected to close) -- were similarly forfeited. The complaint further alleges that the Defendants so misled the Class Members in order to effectuate a plan to acquire Cemax-Icon with the lowest possible expenditures while keeping its crucial employee and consultant base intact, thereby enabling Imation to soon thereafter dispose of Cemax-Icon, along with and as a critical component of Imation's worldwide Medical Imaging Systems business, for maximum profit and limited cash outlay. The Imation-Kodak deal eventually closed on November 30, 1998 in a transaction valued at approximately $520 million. Contact: Law Offices of Lionel Z. Glancy, Los Angeles Lionel Z. Glancy, 310/201-9150 KEANE INC: Iowa Hospitals Denied Cert. in Suit Against Software Co. ------------------------------------------------------------------- Ruling that the plaintiffs were attempting to evade the provisions of the Y2K Act by asserting jurisdiction through another federal statute, Judge Michael J. Melloy of the U.S. District Court for the Northern District of Iowa denied class certification to several hospitals in their lawsuit against software company Keane Inc. Mineral Area Osteopathic Hospital et al. v. Keane Inc., No. C99-50 MJM (N.D. Iowa, Cedar Rapids Div., May 25, 2000) The plaintiffs --Mineral Area Osteopathic Hospital Inc. d/b/a Mineral Area Regional Medical Center, Community Memorial Healthcare Inc. and North Country Hospital Inc. --filed a complaint against Keane Inc. in March 1999 and moved for class certification, alleging breach of contract as a result of Keane's refusal to repair a defect in the MEDNET software sold to the hospitals by its predecessor, Source Data Systems. The Y2K Act, 15 U.S.C. @ 6601 et seq., was enacted several months after the hospitals filed their lawsuit. As Judge Melloy explained, the purpose of the Y2K Act was to curb insubstantial litigation and encourage parties to resolve their disputes. He cited an express provision in the act, 15 U.S.C. @ 6614(c)(2)(D), which requires that not only must parties seeking class certification comply with the Federal Rules of Civil Procedure, but they must also be a class of at least 100 members. In the hospitals' putative class action, the class numbered, at most, 81, which, in the judge's words, was a "generous estimate." The hospitals nonetheless argued that the class action requirement of the Y2K Act was not applicable to them because it only had to be met when the act was being used as the means of asserting jurisdiction in federal court. They were not relying on the Y2K Act, the plaintiffs asserted, but were claiming diversity jurisdiction pursuant to 28 U.S.C. @ 1332. Judge Melloy rejected their argument that the purpose of the Y2K Act was to expand jurisdiction for Y2K actions, reasoning that it would allow many plaintiffs to circumvent the statute altogether. The hospitals' logic, he said, meant that if plaintiffs were allowed to establish some other form of federal jurisdiction, they would not have to respect the requirements of the Y2K Act, which would be contrary to its stated purposes. Rejecting the hospitals' legal argument, and finding that they failed to meet the numerosity requirement of the Y2K Act, Judge Melloy denied their motion for class certification. The plaintiffs are represented by Roger T. Stetson and Michael R. Reck of Belin Lamson McCormick Zumbach Flynn in Des Moines, Iowa. The defendants are represented by Scott E. McLeod of Lynch, Dallas, Smith & Harman in Cedar Rapids, Iowa. (Year 2000 Law Bulletin, July 2000) PMI MORTGAGE: Announces Dismissal of RESPA Lawsuit in Georgia ------------------------------------------------------------- PMI Mortgage Insurance Co. announced that the U.S. District Court, Southern District of Georgia has granted its motion for summary judgment in the putative federal class action lawsuit, captioned G. Craig Baynham and Linnie Baynham v. PMI Mortgage Insurance Company, which alleged violations by the company of Section 8 of the Real Estate Settlement Procedures Act (RESPA). The order issued by the court dismisses the lawsuit in its entirety. Under federal law, the court's order granting PMI's motion for summary judgment may be appealed by the plaintiffs to the Eleventh Circuit Court of Appeals. POTASH CORPORATION: Consumers Appeal in Potash Price-Fixing Case ---------------------------------------------------------------- In June 1993, PCS and PCS Sales (Canada) Inc. were served with a complaint relating to a suit filed in the United States District Court for Minnesota against most North American potash producers including Potash Corporation of Saskatchewan Inc. The complaint alleged a conspiracy among the defendants to fix the price of potash purchased by the plaintiffs as well as potash purchased by the members of a class of certain purchasers proposed by the plaintiffs. Similar complaints were filed in the United States District Courts for the Northern District of Illinois and the Western District of Virginia. On motion of the defendants, all of the complaints were transferred and consolidated for pre-trial purposes in the United States District Court for Minnesota. The complaint sought treble damages and other relief. PCS and PCS Sales filed a motion for summary judgment on December 22, 1995. On January 2, 1997, Judge Richard H. Kyle issued an order granting the defendants' motions for summary judgment and dismissing the lawsuit. The plaintiffs appealed that order to the United States Court of Appeals for the Eighth Circuit. On February 17, 2000, the Eighth Circuit, en banc, affirmed Judge Kyle's summary judgment ruling. The plaintiffs filed a petition for writ of certiori with the United States Supreme Court on May 17, 2000. The Supreme Court has not yet ruled on that petition. Additional complaints were filed in the California and Illinois state courts on behalf of purported classes of indirect purchasers of potash in those states. PCS moved to dismiss the California State Court lawsuits for lack of personal jurisdiction and the court ruled that it does not have personal jurisdiction over PCS but that it does have personal jurisdiction over PCS Sales. Following Judge Kyle's summary judgment decision, the California litigation was stayed and the case remains at an early stage: no merits discovery has taken place. The Illinois State Court complaint was dismissed for failure to state a cause of action and that decision is final and not subject to appeal. QWEST: Asks CO Court to Limit Discovery over Alleged Deceptive Practice ----------------------------------------------------------------------- Qwest asked Colo. court to limit discovery in class action state suit over whether company had deceived new customers about how soon they would get phone service installed. In pretrial motion, Qwest asked Larimer County Dist. Court Judge John Sullivan to limit plaintiffs' requests for data to items created before Jan.1. Qwest also asked that court reject discovery motion seeking electronic documents and e-mail records of 450 employees going back to 1993 or, in alternative, to make plaintiffs pay for gathering of data. Qwest said it was willing to cooperate on 50 employees directly involved in service order fulfillment, but objected to rest of discovery request on grounds of expense and irrelevance. Qwest said it had spent $2 million so far to produce 1.3 million pages of records and other evidence and additional discovery requests would cost it at least another $1 million. However, plaintiffs' attorneys said information sought after Jan. was necessary to show Qwest hadn't changed alleged policy of not warning new customers of possible installation delays and giving preference to those likely to have large bills. Attorneys said requested information from all 450 employees was needed in connection with allegations that company's investment allocation policies in early to middle 1990s led to held-order problems. Meanwhile, local reports indicated Qwest and plaintiffs were in negotiations on possible settlement of suit, which seeks damages of more than $ 300 million on behalf of 220,000 customers of former U S West, which was acquired by Qwest earlier this year. Suit alleges company knowingly deceived customers as to extent of held- order problems and made false promises on how soon new service would be installed. Company has denied claims. (Communications Daily, August 17, 2000) REDLANDS CONTAMINATION: Review Petitioned on Rule on Lack of Commonality ------------------------------------------------------------------------ Supreme Court Case No. S088458 Case below: E025064; Cal.Ct.App., 4th Dist., Div. 2; 79 Cal.App.4th 1019, 94 Cal.Rptr.2d 652, 00 C.D.O.S. 2809 Petition filed: May 19, 2000 Review granted: July 12, 2000 Justices voting for review: Baxter, Brown, Chin, George, Kennard, Werdegar Procedure: Petition for review after grant of petition for writ of mandate. Question presented: Did the court of appeal err in holding that there was not a sufficient community of interest among putative class members to allow class certification in a groundwater pollution action where numerous individual inquiries would be necessary to establish each putative class member's claim to medical monitoring? Facts: Roslyn Carrillo and other individuals living in Redlands brought a putative class action suit against a group of companies with manufacturing operations in the city. The plaintiffs alleged that beginning in 1954, the manufacturing operations discharged dangerous chemicals into the city's groundwater. The residents sought damages in the form of a court-supervised medical monitoring program funded by the manufacturers and punitive damages. The residents moved for class certification of a medical monitoring class and a separate punitive damages class. The residents claimed the class was ascertainable because it included only persons living in a defined geographic area, as well as students and workers from the area. The residents estimated that this class could amount to 50,000 to 100,000 persons. The trial court certified the class, finding that the residents had met their burden of proof under Code Civ. Proc. @382 of showing that they had a realistic chance of success on the merits. The trial court found that there was an ascertainable class with a well-defined community of interest and common questions of fact and law among members. The manufacturers petitioned for writ review, challenging the class certification. The court of appeal granted the petitions and issued writs of mandate, holding that there was an insufficient community of interest among the putative class members to allow certification. The court found that although sufficient common issues of fact existed among the class members, these common issues were overwhelmed by the numerous inquiries necessary to establish each individual's claim to medical monitoring. The court pointed out that it would be necessary to introduce evidence as to each class member's level of exposure to a range of chemicals, as well as the individual's personal characteristics and medical history. Moreover, the court noted that the manufacturers had raised a statute of limitations defense, which would require inquiry into each class member's knowledge of the contamination. The court also opined that the manufacturers' liability to pay for medical monitoring would depend on each class member's exposure, lifestyle and any preexisting condition. Thus, a trier of fact would be confronted with a number of factual questions as to each class member before being able to determine if the manufacturers were liable for that person's medical monitoring. Counsel for petitioner Roslyn Carrillo: Thomas Girardi, Girardi & Keese, 1126 Wilshire Blvd., Los Angeles, CA 90017, 213-977-0211 Counsel for respondent Lockheed Martin Corporation: Robert Warren, Gibson, Dunn & Crutcher, 333 S. Grand Ave., Los Angeles, CA 90071, 213-229-7000 (California Supreme Court Service, July 14, 2000) REPUBLIC SERVICES: Securities Suit in FL Recently Consolidated -------------------------------------------------------------- In September 1999, several lawsuits were filed by certain shareholders against Republic Services Inc. and certain of its officers and directors in the United States District Court for the Southern District of Florida. The plaintiffs in these lawsuits claim, on behalf of a purported class of purchasers of the Company's common stock between January 28, 1999 and August 28, 1999, that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by, among other things, allegedly making materially false and misleading statements regarding the Company's growth and the assets acquired from Waste Management. On December 29, 1999 the Court consolidated these lawsuits and the consolidated action has been named In Re: Republic Services, Inc. Securities Litigation. The plaintiffs filed a consolidated complaint in February 2000 and the defendants filed a motion to dismiss the consolidated complaint in April 2000. The motion to dismiss has been fully briefed by the parties to the lawsuit and oral argument on the motion to dismiss has not yet been scheduled. RYLAND GROUP: Residents Vote to Pay for Sinkhole Repairs -------------------------------------------------------- Homeowners will pay a one-time fee of $ 1,000 to fill the gaping hole. They also may seek repayment from the developer. Faced with the possibility of a surprise bill, Crystal Oaks residents have flatly refused an offer from their development owner to repair a giant sinkhole that opened up last month near several homes. "There is not much trust between the people of the community and Ryland," homeowner Bruce Wickersham said in reference to Ryland Group Inc. of Calabasas, Calif., and its wholly owned subsidiary, Ryland Communities. On Monday, at a well-attended meeting of the Heather Ridge Homeowners Association, residents decided to finance the repairs through a one-time $ 1,000 assessment for each of the 86 homes within Heather Ridge and Hunters Ridge, the two gated communities within Crystal Oaks, said attorney Dan Pilka of Brandon, who represents the association. Several sinkholes recently opened up off Crystal Oaks Drive after heavy rains, including a large one that runs about 40 feet deep into limestone caverns. Yellow police tape now surrounds the entire area to restrict access. The appearance of the sinkholes infuriated residents who have cited recurrent sinkholes in a lawsuit filed this year against Ryland Group and Ryland Communities. The suit, which seeks class action status on behalf of nearly 60 homeowners, accuses the companies of lying to residents and undercutting their property values. The average home is valued between $ 100,000 and $ 150,000, Pilka said. Residents saw an Aug. 10 letter in which Ryland attorneys refused to promise that the companies will not seek repayment for the work. "They don't have a great deal of confidence Ryland will do what they say they're going to," Pilka said. The bill won't be cheap. Pilka said the repair plan approved by the Southwest Florida Water Management District could cost about $ 75,000. Ever since they took control of their homeowners association this spring, residents have been responsible for retention pond maintenance. Pilka said they may demand reimbursement from the Ryland companies. Ryland Group spokesman Anne Madison said the rejection of the offer is disappointing. She also said she was not aware of the letter warning residents they could be billed for the repairs. The company made its offer in a July 21 letter, she said. "Our main concern was that the sinkhole gets fixed and the homeowners association certainly has the prerogative to choose," she said. "We would have liked to see that come to a resolution in the interest of the homeowners." Madison was not aware that Swiftmud rejected the companies' repair plan in favor of a more expensive one proposed by the residents' hydrogeologist. The companies' plan would have cost about $ 29,000, Pilka said. Swiftmud is requiring the association to fill the sinkhole bottoms with a coarse substance, such as crushed stone, followed by layers of sand and a mixture of sand and clay. The district wants the work done by Aug. 21, Swiftmud spokesman Mike Molligan said. But there will be undetermined additional costs because the district is demanding a plan to line the sinkhole area with clay so they do not return, Pilka said. The litigation is proceeding, he said. Ryland Group denied the association's allegations, and Ryland Communities filed a motion to compel arbitration. Ryland Group is a $ 2-billion company that builds 10,200 homes a year, including around 800 annually in the Tampa area, Madison said. (St. Petersburg Times, August 17, 2000) SOUTHWESTERN BELL: Customers Say Connect Times Slowed to Increase Sales ----------------------------------------------------------------------- A group of Houston-area Internet users is seeking an unspecified amount of damages against telecommunications giant Southwestern Bell and its affiliated companies for allegedly slowing down the speeds at which customers connect to the World Wide Web. The allegations are contained in a lawsuit filed in the 148th District Court of Nueces County, Texas in Corpus Christi. At issue are high-speed digital subscriber lines (DSLs) that allow web users to connect to the Internet much faster than using standard modem lines. DSLs also allow users to receive digital data from the Internet while using the same lines to receive analog voice data for standard phone use. Led by Houston-based Net Help Solutions, the plaintiffs allege that Southwestern Bell, Pacific Bell, and other SBC Communications, Inc., subsidiaries guarantee a minimum connection rate of 384 kilobits per second (kbps). However, according to the plaintiffs, SBC has intentionally lowered the access rate to e-mail and newsgroups by two-thirds of the promised rate, 128 kbps, without notifying customers or giving any discount for the inferior service. A copy of the lawsuit can be found at www.bafirm.com. DSL customer Thomas McLaughlin, President of Net Help Solutions, discovered the rate discrepancy when he ran tests on his own. His suspicions were confirmed by a technical support representative who said that e-mail and newsgroup access rates were limited to a maximum rate of 128 kbps. Postings on Southwestern Bell's own newsgroup bulletin boards further confirm the existence of a policy to cap access rates different from those guaranteed, according to the petition. Plaintiffs' attorney Geoffrey Berg of Houston's Berg & Androphy says the defendants have apparently enacted the "speed cap" in order to maintain their two-year, $6 billion initiative called "Project Pronto," which Berg says is an effort to capture as much of the lucrative DSL market as possible. "In order to allow growth to continue, SBC and its affiliated companies must be able to provide enough room, or bandwidth, for new customers," explains Berg. "What they're doing today is limiting connection speeds in areas where people are less likely to notice. This allows the defendants to effectively re-sell the same bandwidth that they are supposed to be providing to existing customers. Apparently they want to sign up as many people as they can, and then worry about how to fix the problems later." Customers who want to switch Internet Service Providers must pay a$200 cancellation penalty before waiting for their ISPs to switch their phone lines over for use by a competitor, the petition states. The petition alleges that the defendants have committed fraud by misrepresentation, theft by conversion, theft by fraud, gross negligence and unjust enrichment and have attempted to monopolize the DSL market. The defendant companies have 20 days to respond to the plaintiffs' lawsuit. Net Help Solutions is located on the Internet at www.net-help.net. Contact: Androvett Legal Media Mike Androvett, 800/559-4534 SPORTS CLUB: CA Suit Says Attractive Women Get Preferential Discounts --------------------------------------------------------------------- Lyudmirsky and those similarly situated v. Sports Club, Inc. of California; LA/Irvine Sports Club, Ltd. (Los Angeles Superior Court). On June 25, 1999, Ilya Lyudmirsky filed a class action lawsuit against Sports Club, Inc. of California and LA/Irvine Sports Club, Ltd. alleging, among other things, violations of California Civil Code Section 1812.80 et seq., claiming Sports Club�s membership fee structure and membership contracts for The Sports Club/LA in Los Angeles violate certain provisions of the Health Studio Services Act. Lyudmirsky further alleged violations of the Unruh Act and the Consumer Legal Remedies Act, claiming the company gives unlawful, preferential discounts to attractive women and advertise membership fees that are higher than fees actually charged to some members. The complaint seeks equitable relief, (including a temporary and permanent injunction), unspecified compensatory damages, punitive damages and attorneys' fees. On May 1, 2000, the parties entered into a settlement agreement that would dispose of all claims. The court has given the settlement preliminary approval and notice of the proposed settlement has been sent to all potential class members. A hearing on final approval of the settlement is scheduled during October 2000. Under the settlement agreement, Sports Club will provide a stipulated class of certain current and former Sports Club/LA members with one to two months of free membership as well as a number of guest passes. The company has recorded a charge of $1,476,000 in the first quarter of 2000 to reflect the anticipated costs of defending and settling this action. Particularly in light of the costs of defending the lawsuit, the settlement is believed to be in our best interest. TENFOLD CORP: Berman, DeValerio Files Securities Fraud Suit in Utah ------------------------------------------------------------------- Tenfold Corporation (NASDAQ: TENF) was charged with misleading investors in a securities class action filed by Berman, DeValerio & Pease LLP, www.bermanesq.com. The action is pending in the United States District Court for the District of Utah on behalf of all persons and entities who purchased or otherwise acquired the common stock of TenFold during the period January 31, 2000 through and including August 14, 2000 (the "Class Period"). The action alleges that the defendants violated the federal securities laws by issuing a series of false and misleading statements concerning the Company's business and financial condition during the Class Period. In particular, the Complaint alleges that the Company continued to report revenues from large customer projects despite knowing that many of these customers were extremely upset with TenFold and likely to cancel their orders. TenFold prematurely recorded revenue from these projects and/or failed to timely and properly increase their allowance for doubtful accounts from these customers. After disclosing on July 10, 2000 that its second quarter 2000 earnings would be well below expectations as a result of project delays, TenFold's stock collapsed, falling as much as 40%. The full truth was not disclosed until August 14, 2000, however, when the Company released its second quarter earnings, which were below the July 10, 2000 numbers because a review of significant projects required the Company to reduce recorded revenue and increase their allowance for doubtful accounts. During the Class Period, but prior to the disclosures, TenFold executives sold their stock for proceeds of over $26 million. Contact: Berman, DeValerio & Pease LLP Jennifer L. Finger, Esq. at (800) 516-9926 TOBACCO LITIGATION: Lawyers Say Firms Should Be Fined for Changing Venue ------------------------------------------------------------------------ Make tobacco pay for changing courts The tobacco industry is trying to manipulate the court system and should be fined $ 38 million a day for moving the first smokers' class-action case to federal court, smokers' attorneys said. Allowing the case to stay in federal court after a two-year state trial "would make a mockery of nearly a decade of litigation," attorneys for an estimated 500,000 sick Florida smokers said in a motion to send the case back. Mike York, a lawyer for Philip Morris Inc., had no response to the request for sanctions and said the industry would respond to the motion in court. The industry's legal maneuver to change courts after losing a record $ 145 billion punitive damage verdict "transcends canons of ethics, good lawyering and basic decency," the motion said. Smokers' attorneys proposed fining the nation's five biggest cigarette makers $ 38 million a day --- the amount of interest they say is lost each day by delaying the signing of a final judgment. Killer of store clerk executed in Texas A man who fatally shot a convenience store clerk worried about his victim's family in the moments before he was executed by injection in Huntsville, Texas, Wednesday evening. "What I want to say is I have remorse and I'm really sorry about what happened to that family," John Satterwhite, 53, said in a telephone call to The Associated Press less than an hour before he was strapped to the Texas death chamber gurney for killing Mary Francis Davis, 54. Satterwhite already had been arrested eight times and had served a prison term for burglary and robbery by assault when he was charged with the March 12, 1979, killing of Davis in San Antonio. Satterwhite was the third of six condemned killers scheduled to die this month in Texas and the 29th this year in the state with the most executions. West Point cadet imprisoned for theft A U.S. Military Academy cadet from North Carolina has been sentenced to prison for breaking into a store at the academy and stealing nearly $ 25,000 worth of merchandise. William L. Bender, 20, was sentenced in West Point, N.Y. , Tuesday to 15 months at Fort Leavenworth, Kan., dismissed from the Army and stripped of all pay and benefits. "I can't stop this feeling of eternal shame, " Bender said as he sobbed during the sentencing. Celebrities back art museum strike Strikers at the Museum of Modern Art in New York City drew support from celebrities, including artists Robert Rauschenberg and Art Spiegelman, filmmakers Steven Spielberg and Martin Scorsese and performers Laurie Anderson and David Byrne. The first strike in 27 years by museum employees --- including archivists, conservators, curators, librarians and other professionals --- has dragged on for more than three months. Points of contention include salaries as well as union demands for compulsory membership of professional staff. 2 construction workers killed in wall collapse A 25-foot-high cinder block wall collapsed at a construction site in suburban Baltimore on Wednesday, killing two workers and injuring three. The accident took place at a building under construction at a business park in Woodlawn, Md. Braces supporting the wall had been removed to allow workers to pour a concrete floor, worker Ricky Samuel said. LSU not celebrating top party school rank It's a list Louisiana State University officials were desperately trying to avoid, but instead, they came out on top --- LSU has been named the No. 1 party college in America. The rank by The Princeton Review was disheartening to school officials still shaken by the August 1997 death of an LSU student who celebrated his acceptance into a fraternity with a night of excessive drinking. Last year's No. 1, Florida State University, is fourth. The Princeton Review, which isn't affiliated with Princeton University, ranks schools based on a survey of 59,000 college students across the country. No Georgia schools ranked in the top 20. (The Atlanta Journal and Constitution, August 17, 2000) WONDER BREAD: Jury Hits Bakery with $ 132 Million Punitive Damages ------------------------------------------------------------------ A jury awarded $ 121 million in punitive damages on Aug. 2 to 17 black employees of the maker of Wonder Bread and Twinkies for racial bias that denied them promotions, pay raises and even the use of certain restrooms. The same jury had earlier awarded the plaintiffs $ 11 million in compensatory damages for lost wages and emotional distress. Superior Court Judge Stuart Pollak said that he will reduce the $ 11 million because the statute of limitations had run on some acts. The 17 plaintiffs stood and applauded the jurors. The company, Interstate Brands Corp., of Kansas City, called the verdict unwarranted and promised to appeal. In her closing, lead plaintiffs' attorney Angela Alioto urged jurors, "Punish them. Punish them." Carroll v. Interstate Brands Corp., No. 995728. (The National Law Journal, August 14, 2000) * Group Says Blacks Not Getting Senior Government Jobs ------------------------------------------------------ Blacks are better represented in government than they were 25 years ago, but the top jobs remain the preserve of a predominantly white elite, according to the organization that represents blacks in government. Blacks, who make up 12.8 percent of the U.S. population, now account for 16.9 percent of federal agency executive branch members. But the vast majority of senior government jobs -- 87.1 percent -- go to whites, with blacks accounting for just 6.9 percent, according to Office of Personnel Management statistics. "When BIG was formed 25 years ago, it was due to the fact we had lack of opportunity in terms of jobs, upward mobility and training," said Gerald R. Reed, national president of BIG, which is preparing to celebrate its silver anniversary. "Guess what: There's still a lack of opportunity." As if to emphasize that point, black Secret Service agents on Tuesday released new documents in their ongoing lawsuit, which alleges "unlawful discrimination" by the Treasury Department in hiring and promotion. The papers, released by attorneys for 10 black Secret Service agents, include new charges that white Secret Service agents participated in racist gatherings in the 1980s and 1990s known as the "Good Ol' Boys Roundup," where signs with racial slurs were displayed and a simulated lynching of a black person took place. Kenny Banner, who is now retired, said he endured racist taunts throughout his career as a special agent. He contended in court papers that two Nigerian postage stamps were left on his desk with a note reading "Go back to Africa." The papers also claim that on a home telephone line known only to Secret Service personnel, Banner received a threat on his life containing a racial epithet. In Los Angeles, the court papers allege, a black agent married to a white woman found that someone had taped monkey faces over pictures of his children. Attorney Ronald A. Schmidt said the class action brought by the 10 plaintiffs covers 250 black agents in the Secret Service and dates to 1974. Jim Mackin, a spokesman for the Secret Service, said that "we take the matter very seriously. The fact is that two of our seven assistant directors are African-American. Of our 11 largest field offices in the country, seven are headed by minorities, four by African-Americans." (Sun-Sentinel (Fort Lauderdale, FL), August 17, 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 reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *