/raid1/www/Hosts/bankrupt/CAR_Public/001023.MBX              C L A S S   A C T I O N   R E P O R T E R

             Monday, October 23, 2000, Vol. 2, No. 206


AETNA INC.: Securities Suit Settlement and Fairness Hearing Announced
ASPEC TECHNOLOGY: Amended CA Derivative Suit May Be Filed Until Oct 30
ASPEC TECHNOLOGY: Has Responded to SEC Inquiry
ASPEC TECHNOLOGY: Hearing for Complex Suit over IPO Set for Nov in CA
ASPEC TECHNOLOGY: Remains Listed after NASDAQ Inquiry

BRIDGESTONE/FIRESTOEN: FL Takes Lead in investigation with "Little RICO"
CABLETRON SYSTEMS: Ruling on Securities Suit in RI No Earlier Than Nov
CALIFORNIA SOFTWARE: Expects Consolidation of Securities Suits in CA
CHEVRON-TEXACO: National Urban League Calls for Watch on Employment Bias
CLARICA LIFE: Ontario Ct Denies Class Status over Premium Offset

HMOs: Medicaid Recipients in Liability Cases Must Share Winnings
IBP INC: Ranchers Lost Bid for Status in Case over Cattle Prices Again
JOHN BERG: RICO Claims over Sale of Property in PA Survive Dismissal
MANUGISTICS GROUP: Maryland Ct OKs Settlement for Securities Suit
NY CITY: Rebuked for Failure to Provide Services to HIV+ Residents

OAK TECHNOLOGY: Investors File Intent of Appeal to CA Suit Dismissal
PEGASYSTEMS INC: Wolf Popper Issues Notice on Securities Suit in MA
PRICELINE.COM, INC: Scott & Scott LLC Extends Securities Lawsuit in CT
RENO: Court Dismisses Poles' Challenge of Immigration Regulation
ST. CROIX: Dist. Court Certifies 4 Subclasses in Bauxite Exposure Suit

VIRTUALFUND COM: Retains Customers’ Claims on Sold out DGBU Unit


AETNA INC.: Securities Suit Settlement and Fairness Hearing Announced
The following was released on October 20 by Savett Frutkin Podell & Ryan,
P.C., Milberg Weiss Bershad Hynes & Lerach LLP and Law Office Bernard M.






A.M. (EDT) ON SEPTEMBER 29, 1997.

This Notice is given pursuant to Rule 23 of the Federal Rules of Civil
Procedure and the October 5, 2000 Order of the United States District
Court, Eastern District of Pennsylvania. The purpose of this Notice is to
inform you that a proposed settlement of $82,500,000, before any award of
attorneys' fees and costs, has been reached in this certified class
action. The action alleged violations of the federal securities laws. If
you are a member of the Class, you may be eligible to share in the
settlement, and your rights will be affected by the proposed settlement.

On October 13, 2000, a Notice, including a Proof of Claim and Release,
was mailed to potential members of the Class. That Notice contains
important information regarding the rights of Class members and a form
that must be completed to share in the settlement. If you are a Class
member and if you have not received a copy of the Notice by mail, you may
request a copy free of charge by telephoning the Claims Administrator at
1-800-222-2760 or mailing your request to: Claims Administrator, Aetna
Inc. Securities Litigation, P.O. Box 1387, Blue Bell, PA 19422.

FEBRUARY 28, 2001.

Co-Lead Counsel for the Class in this matter are Savett Frutkin Podell &
Ryan, P.C., 325 Chestnut Street, Suite 700, Philadelphia, PA 19106,
215-923-5400; Milberg Weiss Bershad Hynes & Lerach LLP., One Pennsylvania
Plaza, New York, NY 10119, 212-594-5300; and Law Office Bernard M. Gross,
P.C., 1500 Walnut Street, Sixth Floor, Philadelphia, PA 19102,


For more information, please contact the Claims Administrator, in
writing, at the address listed above.


Dated: October 20, 2000




Contact: Claims Administrator, Aetna Inc. Securities Litigation, P.O. Box
1387, Blue Bell, PA 19422, 800-222-2760.

Source: Savett Frutkin Podell & Ryan, P.C.; Milberg Weiss Bershad Hynes

Contact: Claims Administrator, Aetna Inc. Securities Litigation,

ASPEC TECHNOLOGY: Amended CA Derivative Suit May Be Filed Until Oct 30
of the Company's current and former officers, directors and shareholder
entities were also named as defendants in a derivative lawsuit styled
Linda Willinger, IRA, et al. v. Conrad Dell'Oca et al., No. CV-778007,
filed on November 12, 1998, in the Superior Court of Santa Clara County.
The derivative action alleges facts similar to those in the class action
and also alleges that certain of the directors caused the Company to
conduct the initial public offering in order to redeem preferred stock
they owned or in which they had a beneficial interest. Aspec filed a
demurrer to that Complaint on June 8, 1999 on behalf of certain of the
officer and director defendants and nominal defendant, Aspec. Thereafter,
the plaintiffs requested the defendants' assent to the dismissal of their
complaint and the filing of an amended complaint. Plaintiffs filed their
First Amended Shareholders' Derivative Complaint on September 2, 1999.

The Aspec Defendants demurred to that complaint on November 12, 1999 on
the basis that the nominal plaintiffs had failed to make a demand on the
Board of Directors before filing the derivative lawsuit, and that they
had also failed to plead sufficient facts to excuse a pre-suit demand.
After the matter was fully briefed, the court heard argument on January
25, 2000.

On January 27, 2000, the court sustained the defendants' demurrers with
sixty days' leave to amend.

The parties later stipulated that the plaintiffs would have additional
time in which to file an amended complaint, as well as to re-notice a
motion to compel the production of electronically-stored documents and
records from Aspec, as well as to notice the deposition of a witness from
Aspec to testify concerning the storage of such documents and records.
The plaintiffs presently have until October 31, 2000 to file an amended
complaint and re-notice the above-referenced motion and deposition.

ASPEC TECHNOLOGY: Has Responded to SEC Inquiry
In January 1999, the Company received an informal inquiry from the
Securities and Exchange Commission Staff. The Company has provided
information to the SEC in response to the Staff's requests.

ASPEC TECHNOLOGY: Hearing for Complex Suit over IPO Set for Nov in CA
On July 1, 1998, a class action lawsuit, Howard Jonas, et al. v. Aspec
Technology, Inc., et al., No. CV-775037, was filed in the Superior Court
for the State of California, County of Santa Clara. The Jonas Complaint
alleged that Aspec and certain of its officers, directors and the
underwriters of the Company's initial public offering, violated
California Corporations Code Sections 25400 and 25500, and California
Business and Professions Code Sections 17200 and 17500 by making false
and misleading statements about Aspec's financial condition. The action
was purportedly brought on behalf of all persons who purchased Aspec
stock during the period from April 28, 1998 through June 25, 1998.

On July 2, 1998, July 27, 1998, and August 17, 1998, three additional
complaints were filed in state court against Aspec and certain of its
officers, directors, entitled respectively, William Neuman, et al. v.
Aspec Technology, Inc., et al., No. CV-775089; Martin L. Klotz, on behalf
of the Martin Klotz Defined Benefit Profit Sharing Plan, et al. v. Aspec
Technology, Inc., et al., No. CV-775591; Glen O. Ressler and Thelma M.
Ressler, et al., v. Aspec Technology, Inc., et al., No. CV-776065. In
addition to alleging the same violations of the Corporations Code as the
three other complaints, the Klotz Complaint also alleged violations of
Sections 11, 12, and 15 of the Securities Act of 1933, and a class period
of April 28, 1998 through June 30, 1998. The complaints sought
unspecified damages.

On January 29, 1999, the plaintiffs consolidated the pending class action
cases and filed a Consolidated Amended Complaint, styled Howard Jonas, et
al. v. Aspec Technology, Inc., et al., No. CV-775037. The Consolidated
Amended Complaint was purportedly brought on behalf of all persons who
purchased Aspec's stock between April 27, 1998 and June 30, 1998, alleged
that Aspec and certain of its officers and directors, as well as its
underwriters, violated Sections 25400 and 25500 of the California
Corporations Code, and Sections 11 and 15 of the Securities Act of 1933
(except as to the underwriters).

On June 7, 1999, Aspec and certain of the individual defendants filed
demurrers to the Consolidated Complaint. On June 9, 1999, the plaintiffs
filed a motion for summary adjudication of their claims against Aspec
under Section 11 of the Securities Act. The plaintiffs also moved to
certify a plaintiff class.

On August 26, 1999, the court heard argument on the defendants'
demurrers. The court sustained the demurrers in part and overruled them
in part. Specifically, the court held that the plaintiffs had not pleaded
their claims under California Corporations Code Section 25400 with
sufficient particularity and granted plaintiffs leave to amend this
claim. The court overruled the defendants' demurrers to the Section 11
claim. Following that hearing, plaintiffs withdrew their motion for
summary adjudication. Thereafter, plaintiffs filed their First Amended
Class Action Complaint, under seal, on October 18, 1999.

On January 11, 2000, the defendants filed demurrers to Count I of the
First Amended Complaint, which alleged claims under California
Corporations Code Sections 25400/25500. The Aspec Defendants demurred to
Count I on the basis that plaintiffs had not pleaded facts demonstrating
that the defendants had acted with scienter. The Aspec Defendants also
moved to strike certain allegations in the complaint. The motions were
fully briefed, and the court heard oral argument on defendants' demurrers
and motion to strike and plaintiffs' motion for class certification on
February 24, 2000. The court overruled the defendants' demurrers, denied
the motion to strike, and took the motion for class certification under
submission. Thereafter, on March 13, 2000, the Aspec Defendants answered
the plaintiffs' unverified complaint, generally denying all allegations
and asserting affirmative defenses.

On March 16, 2000, the court certified a plaintiff class. On that same
date, the Court found, sua sponte, that the case is complex, and pursuant
to a pilot program implemented in the Superior Court for Santa Clara
County, assigned it to a single judge for all purposes.

The plaintiffs have re-noticed their motion for class certification,
which is presently scheduled to be heard on November 14, 2000.

ASPEC TECHNOLOGY: Remains Listed after NASDAQ Inquiry
On September 4, 1998, the Company received an informal request for
information from the NASDAQ Listing Investigations Staff. NASDAQ
requested information concerning the Company's financial accounting and
internal controls. The Company has provided information in response to
the informal inquiry. NASD held a de-listing inquiry on December 17, 1998
at which the Company appeared through counsel and provided information.
As of February 25, 1999, the NASD determined that the Company would
remain listed on the NASDAQ.

BRIDGESTONE/FIRESTOEN: FL Takes Lead in investigation with "Little RICO"
The tread separation problems resulting in Bridgestone/Firestone Inc.'s
recent recall of millions of its tires has quickly spawned a number of
regulatory and judicial developments.

Both houses of Congress took little time to commence what are expected to
be intense investigations of the problem, and individual and class action
litigation is expanding around the country.

At the state level, Florida has taken the lead, using the authority of
its "little RICO" statute as an investigative tool. On Aug. 23, the
state's Office of the Attorney General served document subpoenas on
Bridgestone/Firestone and Ford Motor Co. to begin a "fact-finding" effort
to assess the extent of corporate culpability for a product defect that
is alleged to be responsible for more than 100 deaths to date.

Keith Vanden Dooren, Assistant Attorney General with the Economic Crimes
Division of the Attorney General's office, has provided the following
statement to Civil RICO Report concerning Florida's recently commenced

"Separate Subpoenas Duces Tecum were issued as authorized under the
Florida Racketeer Influenced and Corrupt Organization (RICO) Act (Ch.
895, Fla. Stats.) by the Florida Attorney General's Office and served
August 23, 2000, on the Bridgestone/Firestone, Inc. and Ford Motor
Company. The Subpoenas seek documents concerning a vast array of subject
areas connected to Firestone tires/defective tires, including research
and design, quality assurance, tire recalls, complaints, training
materials, purchasing contracts, auditing documents, financial analyses
and computer information.

"The basis for issuing the RICO subpoenas was the office's receipt of
information from recent news reports, witnesses and other information
from company officials and government authorities. The Attorney General's
Office is therefore currently involved in the fact finding stage of the
investigation to determine, inter alia, what Bridgestone/Firestone and
Ford knew and when they knew it. Of significant concern is why certain
defective tires were evidently detected in foreign countries, identified
and withdrawn or recalled, yet there was no apparent initiative taken,
until much later, by either company to identify and recall tires in the
United States. Many consumers may have received injuries or died from the
use of tires known to have been defective by the companies.

"If, in fact, Bridgestone/Firestone and Ford knew of serious defects in
the tires and failed to take appropriate actions, a complaint could be
filed by the Attorney General Office against the companies. Relief sought
under the complaint could potentially include injunctions, restitution to
victims, civil penalties, and revocation of the corporate charter to
conduct business in Florida." (Civil RICO Report, October 11, 2000)

CABLETRON SYSTEMS: Ruling on Securities Suit in RI No Earlier Than Nov
On March 3, 1998 a consolidated class action lawsuit purporting to state
claims against Cabletron Systems Inc. and certain officers and directors
of Cabletron was filed in the United States District Court for the
District of New Hampshire and, following transfer, is pending in the
District of Rhode Island.

The complaint alleges that Cabletron and several of its officers and
directors disseminated materially false and misleading information about
Cabletron's operations and acted in violation of Section 10(b) and Rule
10b-5 of the Exchange Act during the period between March 3, 1997 and
December 2, 1997. The complaint also alleges that certain of the
Company's accounting practices resulted in the disclosure of materially
misleading financial results during the same period.

More specifically, the complaint challenged the Company's revenue
recognition policies, accounting for product returns, and the validity of
certain sales. The complaint does not specify the amount of damages
sought on behalf of the class.

Cabletron and other defendants moved to dismiss the complaint and, by
Order dated December 23, 1998, the District Court expressed its intention
to grant Cabletron's motion to dismiss unless the plaintiffs amended
their complaint.

The Plaintiffs timely served a Second Consolidation Class Action
Complaint, and the Company filed a motion to dismiss this second
complaint. A ruling on that motion is not expected earlier than November

Cabletron says that the legal costs incurred by Cabletron in defending
itself and its officers and directors against this litigation, whether or
not it prevails, could be substantial, and in the event that the
plaintiffs prevail, the Company could be required to pay substantial

CALIFORNIA SOFTWARE: Expects Consolidation of Securities Suits in CA
As previously reported in the CAR and revealed in the company’s report
filed with the SEC, several securities lawsuits were filed against the
company in August and September this year.

On August 17, 2000, a shareholder class action was commenced in the
United States District Court for the Central District of California
against the Company as well as two of its officers and directors, Bruce
Acacio and Carol Conway. The class action was brought on behalf of
purchasers of the stock of the Company during the period February 9, 2000
through August 6, 2000.  The plaintiffs allege that the defendants made
false and misleading statements about the Company's actual and expected
financial performance to inflate the value of the Company's stock to
defraud investors, in violation of federal securities laws.  The
plaintiffs seek damages, interest, costs and such other equitable or
injunctive relief as the Court may deem just and proper.

On or about August 21, 2000, another shareholder class action was
commenced against the Company, Mr. Acacio and Ms. Conway.  The complaint
is based on the same allegations and is seeking the same relief as in the
class action suit described above.

On or about September 11, 2000, a third shareholder class action was
commenced in the United States District Court for the Central District of
California against the Company and Mr. Acacio and Ms. Conway.  This
complaint is based on the same allegations and seeks the same relief as
in the class action suits described above.

On or about September 21, 2000, another shareholder class action was
commenced in the United States District Court for the Central District of
California against the Company, Mr. Acacio and Ms. Conway.  This
complaint is based on the same allegations and seeks the same relief as
in the class action suits described above.

                       Consolidation Expected

The Company expects that the above suits will be consolidated into a
single class action.

The Company believes that it has meritorious defenses to these actions
and intends to vigorously defend them.

CHEVRON-TEXACO: National Urban League Calls for Watch on Employment Bias
The National Urban League on October 19 released the following statement
regarding the recently announced acquisition of Texaco, Inc. by the
Chevron Corp., which would create the fourth-largest oil company in the

    Recalling a 1994 class-action complaint against Texaco in federal
court by black employees and the EEOC's findings in 1996 that black
workers in some types of jobs who sought promotions from 1992 though 1994
were chosen at rates significantly below their non-black counterparts,
National Urban League President Hugh B. Price said:

    "Notwithstanding the trend toward consolidation in the oil sector,
the National Urban League urges and expects the new company formed by
Chevron's takeover of Texaco to remain deeply committed to diversity in
every facet of its business operations.

   "Texaco emerged from its legal troubles as a corporation much more
deeply committed to diversity in every realm of its operations, from
hiring and promotion to subcontracting, retailing and wholesaling
opportunities. Indeed, Texaco progressed from being a problem to a
pacesetter in this arena. We look to the successor corporation to sustain
the encouraging progress made by Texaco in terms of promoting employment
and economic opportunities for people of color."

   To help ensure that this happens, Price said the National Urban League
calls for the following:

   Because there was a consent degree and/or corporate commitment to
diversity involving at least one party to the takeover, the EEOC should
issue an opinion letter on whether the successor corporation will advance
or, at a minimum, sustain -- and certainly not dilute -- the previous
commitments to diversity in the workforce and economic development

   The Federal Trade Commission and U.S. Justice Department's Anti-Trust
Division should look favorably on the merger if the companies will firmly
commit to include minority entrepreneurs among the buyers of any
retailing, wholesaling and refinery operations that must be divested as a
condition of gaining government approval of the transaction. This
commitment would help open up the oil sector to minority firms in an
unprecedented fashion.

   Price added that the National Urban League and other civil rights
organizations will be observing the newly formed company to ensure that
it is adhering to the promotion of diversity and equal opportunity in all
areas of its employment and business practices.

   Hugh B. Price has been President of the National Urban League, a
social service and civil rights organization serving African-Americans
and others who are striving to enter the economic mainstream, since July
1, 1994.

CLARICA LIFE: Ontario Ct Denies Class Status over Premium Offset
An Ontario court has denied class-action status to a lawsuit against
Clarica Life Insurance Co. and Prudential Assurance Co. Clarica Life said
the plaintiffs claimed Prudential and its agents produced sales
illustrations showing 'premium offset' dates that appeared guaranteed
when they weren't. Premium offset is a sales concept used to describe
how, under certain circumstances, dividends may be used to pay or offset
future premiums. (National Post (formerly The Financial Post), October
20, 2000)

HMOs: Medicaid Recipients in Liability Cases Must Share Winnings
Medicaid recipients who win money in liability cases must reimburse the
state for their medical costs, a narrowly divided Washington Supreme
Court says.

The court ruled 5-4 in a King County class-action case filed on behalf of
David Wilson, who was born prematurely and suffered complications. At the
time he was born, his mother was a welfare recipient and eligible to
receive assistance from Medicaid, the publicly funded health program for
the poor and disabled. Wilson developed meningitis, allegedly caused by
the care he received at a Seattle hospital. The boy had brain surgery
several times, but is permanently and severely disabled, according to
court records. Two years later, in 1994, his guardian ad litem sued the
hospital and physicians who treated the boy. The case was settled for
$750,000. The name of the hospital was sealed as part of the settlement.

Before the settlement was reached, the state Department of Social and
Health Services filed a lien for $184,555, the amount the state paid for
Wilson's medical expenses. DSHS deducted its share of legal fees and
costs and adjusted its claim to $108,303.

Wilson reimbursed the state under protest. His attorney, Kathryn Williams
of Seattle, filed a class-action lawsuit on behalf of Medicaid recipients
who have been forced to pay a portion of their settlements or judgments
to the state as reimbursement for medical assistance.

Williams argued that federal law prohibits states from seeking
reimbursements from settlements or judgments obtained by Medicaid
recipients. Instead, she said, states must pursue third-party claims

King County Superior Court Judge Kathleen Learned ruled partially in
favor of Wilson. She said the state could only recover money from the
portion of Wilson's settlement that was specifically allocated to medical
expenses. The rest of the settlement was viewed as Wilson's "property,"
and was off-limits to the state, the judge said.

The state Supreme Court disagreed and overturned Learned's decision,
allowing DSHS to keep the money. Chief Justice Richard Guy, writing for
the majority, said DSHS put a lien on the money before the settlement was
reached - in other words, before it became Wilson's property. Guy noted
that Medicaid is to be the "payment source of last resort" and needs to
be replenished in order to provide assistance to people who have no
alternatives. The DSHS chief has the discretion to seek a lesser amount
if the lien for reimbursement exceeds the settlement amount, or in the
interest of "fairness," Guy added.

Justice Gerry Alexander, in a dissent, said the ruling is "unjust" to
Medicaid recipients. "Under the decision, a Medicaid recipient can be
unfairly deprived of amounts he or she receives as damages for pain,
suffering, loss of income and the like - elements of damage that are
unrelated to medical expenses that have been paid by the state,"
Alexander wrote. "In the final analysis, the majority decision appears to
be more influenced by its concern for replenishment of the state's
medical fund than by a concern for doing equity to Medicaid recipients,"
he added.

Williams could not immediately be reached for comment. Her husband and
co-counsel, Rob Williamson, said Williams likely will ask the high court
to reconsider its narrow decision.

If that fails, she may take it to the U.S. Supreme Court, he said.

The majority opinion was signed by Justices Phil Talmadge, Charles Smith,
Barbara Madsen and Bobbe Bridge. The dissent was signed by Justices Faith
Ireland, Richard Sanders and Charles Johnson. (The Associated Press State
& Local Wire, October 20, 2000)

IBP INC: Ranchers Lost Bid for Status in Case over Cattle Prices Again
A group of ranchers has lost another bid to have its lawsuit over cattle
prices certified as a class-action lawsuit against IBP Inc. Senior U.S.
District Judge Lyle Strom ruled on October 18 that feedlot owners could
not be included in the lawsuit because they do not own the cattle they
sell to meatpackers.

An attorney for the cattlemen, David Domina, had hoped that feedlots
could help filter any damages won down to the ranchers that use them as a
middleman to sell their cattle. Domina said that he would try again to
define a class for the lawsuit. "This was not a shocking result, by any
means," Domina said.

The lawsuit accuses the nation's largest meatpacker of using contract
agreements with ranchers to capture cattle, thereby reducing demand and
paying less on the cash market.

IBP argues that oversupply of beef and limited access to foreign markets
are to blame for low livestock prices, not packers.

Domina had asked Strom to define the class as those selling to cattle to
IBP on the cash market. An exception could be made for those who had used
contract agreements on occasion, Domina said. But Strom also ruled that
including ranchers with contract agreements creates an inherent conflict
within the class and cannot stand. Domina said the group of ranchers may
have to define the class as only those ranchers selling to IBP for cash,
without mixed sellers. There are thousand of sellers involved, Domina
said, making it more difficult to sort them out, but not impossible.

Based in Dakota Dunes, S.D., IBP controls more than a third of the U.S.
beef packing industry, with sales of beef and pork last year totaling
$14.1 billion.

The company said the group's failure for a third time to define a class
for the lawsuit is another indication the case ultimately will be
dismissed. "The plaintiffs' allegations are simply without merit," said
Gene Leman, chief executive officer of IBP Fresh Meats Co. "Numerous
studies have proven that changes in cattle prices are due to basic supply
and demand, not packer concentration or livestock marketing agreements."

If the lawsuit cannot be certified as a class-action, it probably will be
dropped, Domina said, because the plaintiffs could not afford to proceed
individually. They include two ranchers in Nebraska, and one each in
Kansas, South Dakota and Montana.

Filed four years ago in federal court in Alabama, the lawsuit was
rejected two years ago, when U.S. District Judge W. Harold Albritton of
Montgomery ruled that the differences were far too wide among cattle
operations to qualify as a class action. Some cattle owners run cow-calf
operations, Albritton said, others operate feedlots and others graze

The cattlemen refiled their claim, and Strom took over the case after
agreeing to help the Alabama court with its caseload.

Strom ruled the lawsuit could go forward as a class-action, limiting it
to those who had sold cattle for slaughter to IBP since February 1994.
Strom said the cattlemen could try to prove their case based on a
"workable economic analysis" of the market as a whole rather than on
individual cases.

The company appealed, and in April the 11th Circuit Court of Appeals in
Atlanta ruled the lawsuit did not qualify as a class action because it
wrongly included cattlemen who had sold cattle to IBP under special

That led to the attempt to include feedlots and cattlemen who had sold
cattle to IBP on the cash market, with limited exceptions. (The
Associated Press State & Local Wire, October 20, 2000)

JOHN BERG: RICO Claims over Sale of Property in PA Survive Dismissal
Plaintiffs stated a valid cause of action under RICO against certain
defendants who allegedly committed overt acts in furtherance of a
conspiracy, even though their overt acts were not predicate acts of
racketeering, because plaintiffs alleged that they were directly injured
by the racketeering activities. Motion to dismiss denied.

Plaintiffs alleged that defendant John Berg engaged in fraudulent and
deceptive practices in the sale, financing and settlement of several
residential developments in Philadelphia.

Plaintiffs filed a putative class action against Berg and several
mortgage and title insurance companies (the "non-Berg" defendants). The
complaint alleged that Berg engaged in a RICO enterprise in violation of
18 U.S.C. @ 1962(c) and that the non-Berg defendants participated in a
RICO conspiracy with Berg in violation of 18 U.S.C. @ 1962(d). The
non-Berg defendants moved to dismiss. In Beck v. Prupis, 120 S.Ct. 1608
(2000), the U.S. Supreme Court held that an injury caused by an overt act
that is not an act of racketeering or otherwise wrongful under RICO is
not sufficient to give rise to a cause of action under RICO.

The district court acknowledged that the holding in Beck seemed to
preclude plaintiffs' cause of action against the non-Berg defendants.
However, the court noted that the distinguishing factor was that, unlike
in Beck, plaintiffs here alleged that they were also directly injured by
Berg's racketeering. The court concluded that "Beck is probably best read
as severely limiting the opportunities for vicarious conspiratorial
liability under the RICO statute" and not as making direct participation
in racketeering activity an "absolute prerequisite" for conspiratorial
liability. Therefore, the court denied defendants' motion to dismiss.
However, the court certified its order for immediate appeal, because
"[t]he foregoing conclusion that Beck does not preclude plaintiffs'
claims against the non-Berg defendants is predicated on dicta in a recent
Supreme Court decision that addresses an inherently murky area of the

The case is: Smith v. Berg, PICS Case No. 00-1495 (E.D. Pa. July 17,
2000) O'Neill, J. (Pennsylvania Law Weekly, October 23, 2000)

MANUGISTICS GROUP: Maryland Ct OKs Settlement for Securities Suit
As disclosed in our Quarterly Report on Form 10-Q for the three months
ended November 30, 1999 for the three months ended November 30, 1999, the
company reached an agreement for the settlement of the class action
federal securities litigation in which the company, the Chairman of its
Board of Directors and their former Chief Financial Officer were

The United States District Court for the District of Maryland had issued
an order dismissing the consolidated class action complaint against the
Defendants. The plaintiffs then filed an appeal of the ruling. During the
pendency of the appeal, the parties reached a settlement in principle to
resolve the matter, the parties subsequently entered into a definitive
settlement agreement, subject to the approval of the District Court.

On July 24, 2000 the District Court issue an order for settlement
proceedings outlining the details for providing the appropriate notices
to class members. Class members had until October 2, 2000 to opt out of
the class and until November 11, 2000 to file proofs of claim. The
settlement was approved at a hearing October 13, 2000. The amounts to be
paid by Defendants pursuant to the settlement are being funded by the
company’s insurer and thus the company tells investors settlement will
not have a material adverse effect on it.

NY CITY: Rebuked for Failure to Provide Services to HIV+ Residents
A scathing decision from a federal judge faults New York City for failing
to provide statutorily mandated benefits and services to indigent
residents with AIDS or HIV.

The judge rebuked city officials for violating Title II of the Americans
with Disabilities Act and Section 504 of the Rehabilitation Act by
"chronically and systematically failing to provide plaintiffs with
meaningful access to critical subsistence benefits and services, with
devastating consequences."

In Henrietta D. v. Giuliani, U.S. District Judge Sterling Johnson Jr. set
forth the findings of fact and conclusions of law that he reached
following a bench trial that ended in June.

At the heart of the class-action suit was a 1997 New York City law that
mandates the provision of a broad range of services and benefits to
individuals with AIDS or symptomatic HIV illness. Among other things, the
law created benefits such as nutrition and transportation allowances, and
it required case managers at the city's Division of AIDS Services and
Income Support to assist clients in gaining access to benefits in a
timely manner. Although the law generally required that benefits and
services were to be provided within 20 days after eligibility was
established, the plaintiffs presented evidence of delays that sometimes
extended for years.

For example, the court described the predicament of Henry Bradley, a
51-year-old man who has had AIDS since 1983. Although DASIS initially
funded his housing, it closed his case without notice. Bradley ended up
losing his apartment, unable to gain compliance with judicial
declarations that DASIS had acted wrongfully. He also was unable to gain
access to Medicaid benefits. The court relayed similar stories of three
other individuals with AIDS. It also noted the testimony of two
representatives of other service-providing agencies, who testified as to
the difficulty that eligible individuals encountered when trying to gain
access to benefits to which they were entitled. One of those
representatives testified that it was extremely difficult to have closed
cases reopened even after the issuance of fair hearing decisions in favor
of clients.

"The evidence presented," the court concluded, "demonstrated an alarming
failure to provide plaintiffs with the intensive case management and
assistance that DASIS was intended to provide."

Even the defendants' own quality assurance data, the judge said,
conclusively showed a systemic failure to provide adequate access to
benefits and services. At some DASIS centers, he said, eligible
individuals were denied timely access to benefits and services nearly
half the time.

Thus, the court determined that the defendants had violated Title II of
the ADA, Section 504 and state law. It appointed a magistrate judge to
monitor compliance with the terms of its order for three years.

The plaintiffs were represented by Housing Works Inc., led by senior
staff attorney Armen H. Merjian, and attorneys from Winthrop, Stimson,
Putnam & Roberts and the HIV Law Project, both also in New York.

Merjian said the decision's failure to set more specific relief
provisions is partly due to the fact that requirements relating to the
timely provision of services are already clearly spelled out. "We already
have the timeframes that they have to meet," he said. "We already have
the laws in place. They just have not been meeting them."

The city plans to appeal the decision.

The ruling came three months after a different federal judge declined to
enjoin New York City from similar conduct alleged in a suit filed in

In Wright v. Giuliani, U.S. District Judge William H. Pauley III said the
plaintiffs cannot use the ADA or the Rehabilitation Act to challenge the
adequacy of the benefits they receive, unless they first show that their
benefits are subpar compared to the benefits accorded able-bodied
homeless people. Pauley said his analysis of case law "is not on all
fours" with the Henrietta D. court (see AIDS Policy & Law, Sept. 1, 2000,
p.3). However, Pauley denied the city's motion to dismiss the case,
leaving the matter open for discovery.

Henrietta D. v. Giuliani, No. 95 CV 0641 (SJ), (E.D.N.Y. 9/18/00). q

Thomas D'Agostino, managing editor of LRP Publications' Disability
Compliance Bulletin(r), contributed this report. (AIDS Policy and Law,
October 13, 2000)

OAK TECHNOLOGY: Investors File Intent of Appeal to CA Suit Dismissal
As previously reported in the CAR, the Company and various of its current
and former officers and directors are parties to a consolidated class
action lawsuit filed on behalf of all persons who purchased or acquired
the Company's common stock (excluding the defendants and parties related
to them) for the period July 27, 1995 through May 22, 1996. This state
Master File No. CV758510 was filed in Santa Clara County Superior Court
in Santa Clara, California. The lawsuit originally named as defendants
several of the Company's venture capital fund investors, two of its
investment bankers and two securities analysts. The plaintiffs alleged
violations of California securities laws and statutory deceit provisions
as well as breaches of fiduciary duty and abuse of control. The
plaintiffs sought unspecified monetary damages. After several rounds of
demurrers, the court dismissed all claims except the California
Corporations Code Sections 25400/25500 cause of action against the
Company, four officers and the Company's investment bankers and
securities analysts.

On July 16, 1998, the court provisionally certified a national class of
all persons who purchased the Company's stock during the class period.
The class was provisionally certified with the order held in abeyance
pending resolution of the question of whether a nationwide class may
bring a California Corporations Code Sections 25400/25500 claim. This
issue was resolved in favor of allowing such nationwide class actions by
the California Supreme Court, Case No. 5058723, on January 4, 1999, in
Supreme Court.

On August 5, 2000 the court granted Company's motion for summary judgment
and entered judgment in favor of the Company.

                         Update on Securities Suit

The plaintiffs have filed a notice of their intent to appeal the court's
decision. Based on its current information, the Company believes this
suit to be without merit and will defend its position vigorously.
Although it is possible the court's ruling may be overturned on appeal
and the Company may incur a loss upon an adverse conclusion of these
claims, at the present stage the company says it cannot make an estimate
of any such loss.

                          Derivative Action

Additionally, various of the Company's current and former officers and
Directors are defendants in three consolidated derivative actions pending
in Santa Clara County Superior Court in Santa Clara, California, entitled
lawsuit, which asserts a claim for breach of fiduciary duty and a claim
under California securities law based upon the officers' and Directors'
trading in securities of the Company, has been stayed pending resolution
of the above described class actions. The plaintiffs are seeking monetary
damages, equitable relief and an accounting for the defendants' sales of
shares of the Company's common stock. Based on its current information,
the Company believes the suits to be without merit and will defend its
position vigorously. Although it is reasonably possible the Company may
incur a loss upon conclusion of these claims, an estimate of any such
loss cannot be made.

If any of the above pending actions are decided adversely to the Company,
it would likely have a material adverse affect on the Company's financial
condition and results of operations.

PEGASYSTEMS INC: Wolf Popper Issues Notice on Securities Suit in MA
The following notice is issued by Wolf Popper LLP pursuant to Order of
the United States District Court for the District of Massachusetts:



JOSEPH CHALVERUS, et al., individually and on behalf of all others

similarly situated,


C.A. No. 97-12570-WGY










YOU ARE HEREBY NOTIFIED, pursuant to Rule 23 of the Federal Rules of
Civil Procedure and an Order of the U.S. District Court for the District
of Massachusetts dated September 20, 2000, that a Stipulation of
Settlement (the "Settlement") has been preliminarily approved in the
above-captioned action. The proposed Settlement provides for the
establishment of a settlement fund of $5,250,000 (the "Settlement Fund").

A Hearing will be held on December 18, 2000 at 2:00 p.m., before the
Honorable William G. Young, Chief Judge of the United States District
Court for the District of Massachusetts, United States Courthouse, One
Courthouse Way, Boston, Massachusetts 02110 to determine whether (1) the
proposed Settlement should be approved by the Court as fair, reasonable
and adequate; (2) the action should be dismissed with prejudice; (3) the
above action should be certified as a class action for purposes of
settlement; and (4) plaintiffs' counsel's request for an award of
attorneys' fees and expenses should be granted.



If you have not yet received the full printed Notice of Pendency and
Proposed Settlement of Class Action and Fairness Hearing (the "Notice")
and a Proof of Claim and Release form ("Proof of Claim"), you may obtain
copies of these documents by identifying yourself as a member of the
Class and by writing to the Claims Administrator at the following

Pegasystems Securities Litigation
P.O. Box 683
Old Chelsea Station
New York, New York 10113-0955
Telephone: 800-475-4699

Contact: Robert C. Finkel, Esquire, of Wolf Popper LLP, 212-759-4600, or
877-370-7703, rfinkel@wolfpopper.com

PRICELINE.COM, INC: Scott & Scott LLC Extends Securities Lawsuit in CT
Scott & Scott, LLC, (scottlaw@scott-scott.com) a Connecticut-based law
firm, filed suit in the United States District Court for the District of
Connecticut on behalf of all persons who purchased the common stock of
Priceline.com, Inc. (NASDAQ:PCLN) from July 24, 2000 through September
26, 2000. Scott & Scott, LLC announces that it has extended the class
period to represent shareholders of Priceline.com, Inc. who purchased
those shares from January 31, 2000 to October 4, 2000.

The complaint alleges that Priceline.com and certain of its directors and
officers violated the Securities Exchange Act of 1934 by issuing false
and misleading statements. It contends that Priceline.com did not
disclose that its third quarter results would not meet expectations even
though it knew that it would not due to lower than anticipated sales.
That, coupled with insider trading and the disclosure of missed earnings
on September 27, 2000, caused shareholders to lose 42% value on that date
when shares plunged from$18.64 to $ 10.75.

Contact: Scott & Scott LLC Neil Rothstein, 619/251-0887

RENO: Court Dismisses Poles' Challenge of Immigration Regulation
Plaintiffs, Polish nationals, sought to litigate whether a regulation
creating a rebuttable presumption in immigration proceedings, as to
nationals of certain countries, denied due process and equal protection
of the laws. The rebuttable presumption provided that nationals of
certain countries, who resided in the United States, would suffer extreme
hardship if deported to those countries. Plaintiffs contended that they
too qualified for that presumed showing. The court granted defendants'
motion to dismiss for lack of subject matter jurisdiction and for failure
to state an equal protection claim. It said, among other things, that the
alleged injury was neither concrete, actual nor imminent. It was possible
that plaintiffs would be able to establish extreme hardship without the
presumption since the process of challenging possible deportation was

Judge Mukasey

PANAS v. RENO QDS:02763055 - Plaintiffs seek to litigate whether a
regulation which creates a rebuttable presumption in immigration
proceedings that nationals of certain countries, who reside in the United
States, would suffer extreme hardship if deported to those countries,
denies due process and equal protection of the laws to nationals of
another country who argue that they too qualify for that presumed showing
but are not the beneficiaries of the presumption. The six named
plaintiffs are Polish nationals seeking asylum in this country. (Cmplt.
P8) They seek to represent themselves and a class of others similarly
situated in a challenge to the regulation in question, 8 C.F.R. @
240.64(d)(1) (2000), which grants the presumption to Guatemalan and
Salvadoran nationals. Plaintiffs request a declaration that the
regulation denies them due process and equal protection of the laws, and
an injunction conferring the benefit of the presumption on them and
members of the class they seek to represent. Jurisdiction is based on 28
U.S.C. @ 1343(a)(3) (1994), which gives district courts original
jurisdiction in actions to redress denial of Constitutionally guaranteed
rights under color of law, and 42 U.S.C. @ 1983 (1994), which authorizes
suits based on such denial.

The case is before the court on cross-motions by the parties. Plaintiffs
move for class certification and a preliminary injunction. Defendants -
the Attorney General who promulgated the challenged regulation, and the
Commissioner and the District Director of the Immigration and
Naturalization Service ("INS") who are charged to apply it - move to
dismiss for lack of subject matter jurisdiction because the issue is not
ripe, and for failure of the complaint to state a claim upon which relief
could be granted.

For the reasons set forth below, defendants' motion to dismiss is
granted; plaintiffs, motions are denied as moot.

                          I. The Regulation

The regulation plaintiffs challenge was enacted against an intricate
background of litigation and legislation going back more than 15 years.
The litigation includes a case brought in 1985 by the American Baptist
Churches in the U.S.A., challenging government policy toward religious
workers who sought to help Central Americans seeking asylum in the United
States, and toward the asylum seekers themselves. The case was settled in
1991. See American Baptist Churches v. Thornburgh, 760 F. Supp. 796,
797-811 (N.D. Cal. 1991) (the "ABC litigation"). The plaintiffs in the
ABC litigation had alleged that the United States government "had
politicized its asylum policy by discriminatorily denying refugee status
to persons fleeing repressive regimes supported by the United States."
Blanco v. INS, 68 F.3d 642, 645 (2d Cir. 1995). The settlement included a
stipulation "that the INS would give de novo, unappealable hearings
(conducted before specially-trained asylum officers...) to most
Salvadoran and Guatemalan asylum applicants who were present in the
United States as of September 19, 1990 (Salvadorans), or October 1, 1990
(Guatemalans)." Id.

The legislative background includes two statutes that altered the terms
on which certain aliens could avoid deportation. The first of these
statutes, the Illegal Immigration Reform and Immigrant Responsibility Act
of 1996 ("IIRIRA"), revised the procedures under the Immigration and
Nationality Act ("INA") by consolidating the INA's "exclusion" and
"deportation" proceedings into one form of proceeding "removal" - for
aliens who had been the subject of INS proceedings started on or after
April 1, 1997, and replacing the discretionary relief previously provided
through "suspension of deportation," 8 U.S.C. @ 1254(a) (1994), with
"cancellation of removal and adjustment of status for certain
nonpermanent residents," 8 U.S.C. @ 1229(b) (Supp. IV 1998).

The old procedure had permitted the Attorney General, in her discretion,
to suspend the deportation of a person who had been continuously present
in this country for seven years, was of good moral character, and had
shown that deportation would cause "extreme hardship" to him or to his
parent, spouse or child who was a United States citizen or lawful
permanent resident alien. 8 U.S.C. @ 1254(a)(1). Under the new removal
procedure, however, the period of continuous presence was lengthened to
ten years, and ceased on the date the alien either was served with an INS
charging document that began removal proceedings, or committed an act
that made him inadmissible or removable. 8 U.S.C. @ 1229(b)(1)(D). The
new provision was interpreted to apply to aliens who were the subject of
removal proceedings even before the statute's enactment. See In re
N-J-B-, No. A28 626 831, 1999 WL 1390344, at *8-9 (Dep't Justice Aug. 20,
1999). Further, under the new procedure, the alien would be required to
show that deportation would cause "exceptional and extremely unusual
hardship" to a spouse, parent or child who was a citizen or lawful
permanent resident, and the number of aliens who could qualify was
limited to 4000 per year. See 8 U.S.C. @@ 1229b(d)(1) and (e)(1),
1182(a)(2), 1227(a)(2) and 237(a)(4) (Supp. IV 1998).

The second statute was the Nicaraguan Adjustment and Central American
Relief Act of 1997 ("NACARA"), which, to the extent relevant here,
amended the IIRIRA to adopt the holding in In re N-J-B-, but also
exempted several groups of aliens from its rigors by applying to them the
more lenient pre-IIRIRA practice of counting the period of lawful
residence to include even the period after service of an INS charging
document, and permitting even aliens who had not been the subject of
removal proceedings to apply for cancellation of removal under much the
same terms that had governed suspension of deportation under the INA.
These groups included qualified Salvadorans, Guatemalans, and nationals
of former Soviet bloc countries. See NACARA, 8 U.S.C. 1101(a)(43) (1994
and Supp. IV 1998).

NACARA was anticipated to affect large numbers of aliens, with the INS
projecting 100,000 applications per year. See 63 Fed. Reg. 64,895,
64,906-07 (1998). The Justice Department, explaining the background of
the regulation at issue in this case, noted that "certain factors
routinely noted in evaluations of extreme hardship may serve as strong
predictors of the likelihood of extreme hardship in a given case," and
found those factors in the similar immigration history of ABC litigation
class members, Salvadorans and Guatemalans. The Department found that
those three categories of NACARA-eligible aliens shared "general
predictors" of extreme hardship. However, the Department declined to
adopt a conclusive presumption, noting "the necessity of a case-by-case
evaluation.... 64 Fed. Reg. 27,856, 27,865 (1999).

Instead, in order to promote "greater administrative efficiency" in
processing the expected high volume of cases, id., the Attorney General
promulgated the interim regulation at issue here, which creates a
rebuttable presumption of extreme hardship for ABC litigation class
members, and other qualifying Salvadorans and Guatemalans. See 8 C.F.R. @
240.64(d)(1). The regulation provides that Salvadorans and Guatemalans
with long-pending applications for asylum, and members of the plaintiff
class in the ABC litigation who file applications, "shall be presumed to
have demonstrated that deportation or removal from the United States
would result in extreme hardship to the applicant or to his or her
spouse, parent, or child, who is a citizen of the United States or an
alien lawfully admitted for permanent residence." Id. That presumption
"shall be rebutted if the evidence in the record establishes that it is
more likely than not that neither the applicant nor a qualified relative
would suffer extreme hardship if the applicant were deported or removed
from the United States." Id. @ 240.64(d)(2).


Plaintiffs allege broadly that they "are in different stages of applying
for NACARA relief." (Cmplt. P9) The government has submitted documents
from plaintiffs, immigration files, and plaintiffs have submitted a
letter from their attorney, see Filetech S.A. v. France Telecom S.A., 157
F.3d 922, 932 (2d Cir. 1998) (noting rule that when subject matter
jurisdiction is challenged, "'the court may resolve disputed
jurisdictional fact issues by reference to evidence outside the
pleadings, such as affidavits'") (quoting Antares Aircraft v. Federal
Republic of Nigeria, 948 F.2d 90, 96 (2d Cir. 1991)), which show the
following with respect to each plaintiff: Plaintiff Jerzy Panas is
scheduled for a hearing on his reopened deportation proceeding on
November 11, 2000. (Loprest Decl. "Panas" Tab p. 1) Plaintiff Genowefa
Jankowska states through her attorney that she has sought to file a
stand-alone application under NACARA for suspension of deportation, but
has been unable to do so because the INS has no record of her. (Pl. Mem.
Exh. C) Plaintiff Boleslaw Rzepczyk has filed an application for
suspension of deportation following a notice of the INS's intent to deny
his request for asylum on a claim that he would be persecuted in Poland
because of his political views. That notice, dated September 19, 1997,
noted that the force of his application had been weakened by his visit to
Poland in 1992. (Loprest Decl. "Rzepczyk" Tab p. 9) Plaintiff Jozefa
Michalska was due to be heard on May 17, 2000 on her application to apply
for suspension of deportation, but asked this court to stay that
proceeding on the ground that if she prevailed, her claim in this case
would be mooted. The government agreed to stay her hearing, without the
court's direct intervention. Plaintiff Ryszard Narewski filed in
September 1998 a pending application for suspension of deportation, after
having been charged with illegal entry and having agreed to depart
voluntarily in lieu of deportation. (Loprest Decl. "Narewski" Tab pp. 1,
18, 23)

                            II Due Process

"Article III, @ 2 of the Constitution extends the 'judicial Power' of the
United States only to 'Cases' and 'Controversies." Steel Co. v. Citizens
For A Better Env't, 523 U.S. 83, 102 (1998). The result of that is the
concept of standing, which is required of anyone who would invoke federal

The 'irreducible constitutional minimum of standing' contains three
requirements. First and foremost, there must be alleged (and ultimately
proven) an 'injury in fact' - a harm suffered by the plaintiff that is
'concrete' and 'actual or imminent, not "conjectural" or "hypothetical."'
Second, there must be causation - a fairly traceable connection between
the plaintiff's injury and the complained-of conduct of the defendant.
And third, there must be redressability a likelihood that the requested
relief will redress the alleged injury. This triad of injury in fact,
causation, and redressability comprises the core of Article III's
case-or-controversy requirement, and the party invoking federal
jurisdiction bears the burden of establishing its existence.

Id. at 102-03 (internal citations omitted). What is complained of in this
lawsuit fails each of those tests, at least insofar as plaintiffs allege
a due process violation.

First, the alleged injury is neither "'concrete'" nor "'actual'" nor
"'imminent.'" All of the named plaintiffs are still engaged in the
administrative process of challenging their possible deportation. Thus,
it is still possible that any of them, or any member of the proposed
class, will still be able to establish extreme hardship even without the
benefit of a rebuttable presumption. Therefore, the harm plaintiffs
attribute to the absence of the presumption is both "conjectural" and
"hypothetical." Second, and related, even if plaintiffs were entitled to
the presumption, it is still possible that any of them could be deported
if the INS produced enough proof to rebut the presumption. Therefore,
whatever harm plaintiffs eventually might suffer, it would not
necessarily be "traceable" to the unavailability of the presumption to

Finally, for the above reasons, it is not now clear that any harm would
be redressed by granting plaintiffs the relief they seek. If the INS has
enough proof available to rebut the presumption of extreme hardship, then
making the presumption available to them will not redress their injury.

Moreover, plaintiffs seek only to have a presumption of extreme hardship
that is available to Salvadorans and Guatemalans made available to them;
they do not and cannot claim any a priori entitlement to the presumption.
It is only the availability of the presumption to others that occasions
their complaint, but that availability itself causes them no harm. In
Reno v. Catholic Social Services, Inc., 509 U.S. 43 (1993), the
plaintiffs attempted a facial challenge to regulations that defined
eligibility for a statutorily created amnesty program for illegal
immigrants. The Court rejected that challenge as not ripe for decision,
noting that the regulations "impose no penalties for violating any newly
imposed restriction," but rather "limit access to a benefit created by
[the statute] but not automatically bestowed on eligible aliens."Id. at
58. The Court held that a class member's claim "would ripen only once he
took the affirmative steps that he could take before the INS blocked his
path by applying the regulation to him." Id. at 59.

If anything, the regulation at issue here is even less ripe for challenge
because it would not limit a class member's access to relief if in fact
he could show that he or other protected persons within his immediate
family would suffer extreme hardship from his deportation.

Plaintiffs suggest in their reply papers that the class may include
persons who, "upon hearing the news of so clear a discrimination [between
those favored by the presumption and others), were chilled from even
applying for their NACARA benefits." (Pl. Reply Mem. at 10) Plainly, none
of the named plaintiffs is so situated, all having applied in one fashion
or another to block removal. Nor has counsel identified any such person,
and the phenomenon itself - being deterred from even applying to bar
removal by the news that there is a rebuttable presumption that helps
others - seems counter-intuitive.

Further, assuming that a person who actually claimed to have experienced
such a chill could be found, it seems doubtful that that claim would
confer standing. The regulation in question threatens no harm to, and
imposes no obligation or burden on, any potential plaintiff in this case.
Like the customers of the respondent and would-be plaintiff in Los
Angeles Police Dep't v. United Reporting Publ'g Corp., 120 S.Ct. 483
(1999), who sought access to arrest records in the possession of the
petitioner police department, the potential plaintiffs here "may seek
access under the statute on their own... without incurring any burden
other than the prospect that their request will be denied." 120 S.Ct. at
489. That was not enough to support a facial challenge to the regulation
at issue there, and it is not enough here either, at least insofar as
plaintiffs allege a due process violation.

Whether the flaw in plaintiffs' due process claim is analyzed as a lack
of standing or a lack of ripeness, it seems clear that the bedrock
Article III requirement that there be a case or controversy over which to
exercise subject matter jurisdiction is lacking here. The government has
pointed to other flaws in plaintiffs, due process allegations, and argued
that, even assuming subject matter jurisdiction, they fail to state a
claim. However, for a court to treat such arguments after it has found no
subject matter jurisdiction "is, by very definition, for a court to act
ultra vires." Steel Co., supra 523 U.S. at 102.

                         Equal Protection

Although the Fifth Amendment, unlike the Fourteenth, contains no language
guaranteeing equal protection of the laws, "there is a well-established
equal protection component to the Fifth Amendment Due Process Clause
applicable to the federal government." Skelly v. I.N.S., 168 F.3d 88, 91
(2d Cir. 1999). In this case, the challenged regulation does not
disadvantage plaintiffs directly in obtaining the benefit of avoiding
deportation because there is no limitation on the amount of the benefit
available - i.e., the number of aliens who may avoid deportation by
showing extreme hardship. However, the regulation does make it easier for
others to obtain that benefit, and it is at least arguable that denying
plaintiffs that same advantage constitutes a denial of equal treatment.
See Northeastern Fla. Chapter of the Assoc. Gen'l. Contractors of America
v. City of Jacksonville, 508 U.S. 656, 666 (1993) (holding that
plaintiffs' inability to compete equally for contracts is a
sufficient"injury in fact" to challenge minority set-aside program, and
that plaintiffs need not also allege inability to win the contract).
Thus, it is necessary to address the substance of plaintiffs' equal
protection claim. However, that claim fails, principally because it is
directed at an immigration regulation.

The-Supreme Court "has repeatedly emphasized that over no conceivable
subject is the legislative power of Congress more complete than it is
over' the admission of aliens." Fiallo v. Bell, 430 U.S. 787, 791 (1977)
(quoting Oceanic Navigation Co. v. Stranahan, 214 U.S. 320, 339 (1909)).
So long as there is a "facially legitimate and bona fide" reason for the
exercise of executive discretion, the courts will neither look behind it
nor subject it to any constitutional test. Kleindienst v. Mandel, 408
U.S. 753, 770 (1972). The greater administrative efficiency to be gained
in dealing with the large number of applicants anticipated to be
generated by the ABC litigation, see p. 5, supra is such a legitimate and
bona fide reason.

For the above reasons, defendants' motion to dismiss the complaint for
lack of subject matter jurisdiction and for failure to state an equal
protection claim is granted. Plaintiffs' motions are denied as moot. (New
York Law Journal, October 12, 2000)

ST. CROIX: Dist. Court Certifies 4 Subclasses in Bauxite Exposure Suit
The U.S. District Court here has certified four subclasses in the
proposed class action filed as a result of alleged harm resulting from
the failure of St. Croix Alumina to properly prepare for Hurricane
Georges in 1998 (Josephat v. St. Croix Alumina, No 1999-0036, D. Virgin

The opinion certifies a medical monitoring subclass consisting of people
who were employed or lived in communities downwind from the refinery
plant as of Sept. 21, 1998, when the storm struck the island. The members
of this subclass have suffered or are threatened with illnesses as a
result of exposure to bauxite after the storm, the complaint alleges.

There is a second subclass comprising property owners or leaseholders who
suffered alleged economic loss as a result of bauxite blown about in the
storm. Economic damage is defined as loss of use or enjoyment of real
property; diminution of property value; soil, vegetation and improved
property degradation; and loss or damage to personal property.

                      Personal Injury Subclass

People living or working downwind of the plant who allegedly suffered
"cognizable and emotional injuries as a result of defendants' alleged
negligent acts" are in the personal injury subclass. The punitive damages
subclass consists of the members of the three other subclasses who
suffered damages as a result of the alleged gross negligence of the

The complaint alleges St. Croix Alumina failed to properly store and
contain the red bauxite dust and mud byproducts of the plant in St.
Croix. As a result, the allegedly hazardous material is blown about the
island and envelopes the plaintiffs' communities.

Glenda Cameron and Lee Rohn of Lee J. Rohn Law Offices in St. Croix,
Virgin Islands, Scott Summy and Gabriel Reed of Cooper & Scully in Dallas
and J. Harold Seagle of Roundtree & Seagle in Wilmington, N.C., represent
the plaintiffs. John C. Cleary and Bernard C. Pattie of Pattie & Daley in
St. Croix represent St. Croix Alumina. Rene Tatro and Derek M. Hodges of
Derek M. Hodge Law Offices in St. Thomas represent Glencore. (Mealey's
Emerging Toxic Torts, September 22, 2000)

FEN-PHEN: AHP Income Rise Distorted By Charge Last Year
American Home Products, the US healthcare group, announced a sharp rise
in third-quarter earnings, although this was distorted by last year's
charges covering litigation over its diet drug, Redux. Net income for the
third quarter was $ 726 million against a loss last year of $ 2.64

The company took a $ 4.8 bn charge to cover the litigation in the third
quarter of 1999, but the settlement has been appealed. AHP reiterated its
warning that it might need to take further charges to cover litigation
over Redux.

An AHP official said further charges should be less than previously, but
it could not quote a figure. "Since the settlement of the class action in
the second quarter, negotiations (with litigants who opted out of the
settlement) have accelerated," the official said.

Sales rose 13 per cent in the third quarter on a like-for-like basis, and
were up 14 per cent for the year to date, led by growth in
pharmaceuticals. Consumer product sales were up 7 per cent.

Excluding the Redux charge, earnings per share rose 18 per cent to 58
cents, meeting analyst forecasts.

Bristol-Myers Squibb reported a 13 per cent rise in net profits to $ 24bn
for the third quarter. The rise was driven by strong sales of
prescription drugs, including Avapro, for hypertension (up 61 per cent),
Pravachol, the cholesterol-lowering treatment (up 18 per cent), and
Glucophage, a drug for diabetes (up 25 per cent).

However, delays in the development of Vanlev, a heart drug, and the loss
of patent protection on cancer treatment Taxol meant BMS was badly in
need of products to fulfil its ambitious earnings target. It has signed
an agreement to co-market Zelmac, a new medicine for irritable bowel
syndrome developed by Novartis of Switzerland.

BMS has also announced plans to divest non-pharmaceutical assets,
including Zimmer, its orthopaedics division, and Clairol, the beauty
products unit.

Earnings per share rose 15 per cent to 62 cent, one cent ahead of
forecasts. Excluding the units that are up for sale, earnings were 57
cents, against 49 cents last time. (Financial Times (London), October 20,

HMOs: Demise of Victimless Torts and Class Entry in re Maio v. Aetna
In the entrepreneurial world of plaintiffs' class action lawyers, the
traditional personal injury plaintiff has become an undesired key to the
courthouse door. She comes cluttered with a real past in which she
misused a product, failed to heed written warnings and otherwise provided
defense lawyers with multiple ways to defeat her claim, after her poor
lawyers had invested a great deal of money into prosecuting her case.
What to do? The answer, gleaned from multimillion dollar fee successes in
tobacco litigation, has been to eliminate such flesh-and-blood
plaintiffs, replacing them with faceless governmental bodies seeking
reimbursement for monies spent to treat those real plaintiffs, or to
advance claims on behalf of a large class which claims no injury except
having to pay too much for a product that was actually "worth less."

This latter approach has been used most notably in the recent HMO
litigation utilizing RICO, the Employee Retirement Income Security Act
and state law theories. It is designed to try whole industries in a
slugfest with an invisible opponent - the perfect plaintiff with no past
and no personal responsibility.

In HMO litigation, the basic monetary claim advanced is for reimbursement
of the difference between the real value of the health insurance and what
the class paid for it. The cry is one of "we paid too much." But "too
much" for what?

These invisible plaintiffs disclaim any instance of denial of benefits,
inadequate medical care, or personal injury; they merely say our
insurance is "worth less" than what we paid for it, because of
undisclosed practices by the insurer, most notably "incentives" paid to
physicians to render cost-effective medical care. Moreover, since we all
suffered the same injury - being overcharged for the same insurance - we
should be able to sue as a class.

               Erecting Barriers to Class Action Entry

The recent decision in Maio v. Aetna Inc., No. 99-1854 (3d Cir. Aug. 11,
2000) held that no RICO claim was stated on a "we paid too much for our
health insurance" theory under RICO where there was no actual compromise
or diminishment in the health care delivered to the individual plaintiffs
who purported to sue on behalf of this victimless class (see Civil RICO
Report Sept. 1, 2000, p. 1). In so holding, the 3rd U.S. Circuit Court of
Appeals identified three legal barriers to such claims.

The second Maio barrier against HMO litigation addresses the class action
mechanism. Given the necessity of proving some real injury under Maio,
class actions will not be appropriate because each injury of each class
member will have to be proved (and defended against) on an individual
basis, looking at real people, with individualized problems differing
from each other.

In the words of Maio, "Of course, such losses would have to be alleged
and proven on an individual basis." [Slip Opinion at 28] Moreover,
plaintiffs "obviously cannot show that they actually received something
'inferior' and 'worth less' absent individualized allegations concerning
the quantity and quality of health care benefits Aetna provided under its
HMO plan." [Id. at 37]

                       The filed rate doctrine

The third Maio barrier to HMO class actions is the filed rate doctrine,
which insulates a rate approved by a regulator from collateral attack in
a subsequent private lawsuit. This established doctrine prevents attacks
on the filed rate, directly or indirectly, and bars plaintiffs from
obtaining a lower rate as relief in a lawsuit, whatever the underlying
legal theory.

Since HMO premiums are regulated and approved at the state level by state
insurance departments, and the current HMO lawsuits seek to recover a
portion of the filed rate by way of damages or restitution on an
overcharge theory, the filed rate doctrine should bar such relief. The
doctrine posits the need for expert review of the myriad factors which
affect rate-setting. Maio recognizes this, noting that the complaint
before the court "in effect asks that the trier of fact inappropriately
act as a state regulatory commission and determine the value of Aetna's
product . ... We reject the notion that in the complex world of rate
structures a trier of fact, probably a jury, can make such a
determination." [Slip Opinion at 49]

       Failure to Plead with 'Specificity' Leads to Dismissal

An insured filed a class action against a broker, insurance companies and
a finance company, alleging violations of the RICO Act by failing to
disclose that the agent who acted as his broker also owned the insurance
company and the finance company. The U.S. District Court for the Northern
District of Illinois dismissed the RICO claim for failure to describe the
predicate acts with specificity. (Harris v. Illinois Vehicle Premium
Finance Co., et al., No. 99 C 5411 (N.D. Ill. 7/26/00).)

Willie Harris Jr. contacted Illinois Vehicle Insurance Agency Inc. for
automobile insurance. Illinois Agency sold Harris an automobile liability
policy issued by Illinois Founders Insurance Co., an automobile collision
policy issued by Interstate Bankers Insurance Co., a bail bond card, a
motor club membership with Midwest Road Service, a hospitalization policy
issued by Nation Safe Drivers and a travel protection plan issued by
American Bankers Insurance.

In addition, Illinois Agency issued a retail installment contract to
finance the bail bond, motor club membership, hospitalization policy and
travel protection plan policies and arranged for Illinois Vehicle Premium
Finance Co. to issue a premium finance loan to cover the auto liability
and auto property damage policies. Roger Wolf, the president, sole
director and registered agent of Illinois Finance and Illinois Agency,
signed the retail installment contract as the "seller" and the premium
finance contract as the "agent on behalf of buyer/seller."

After submitting a claim, Harris learned that his insurance had been
cancelled, even though he never received a notice of cancellation. Harris
sued the car insurance broker, the insurers and the finance company
alleging violations of the RICO Act, the Truth in Lending Act, the
Illinois Consumer Fraud Act and breach of fiduciary duty. The insurance
companies, broker and finance company moved to dismiss for failure to
state a claim. Harris moved for class certification. (Civil RICO Report,
October 11, 2000)

BREAST IMPLANT: Telectronics Cited for Right to Sue Parents in Dow Case
Counsel for the Nevada Dow breast implant claimants and Dow Corning Corp.
in August filed supplements and responses in the continuing reaction to
the opinion on best interests of creditors entered Dec. 21 by the
Bankruptcy Court for the Eastern District of Michigan in Bay City (Nevada
Claimants v. Dow Corning Corp., No. 99 CV-75924-DT, E.D. Mich., South.
Div.; See May 2000, Page 9.).

Nevada claimants briefed In re Telectronics Pacing Systems (Nos.
99-3476/99-3478/99-3479/99-3480, 6th Cir.; See story below.) to
supplement their February motion. The February motion argues that the
motion of Dow Corning and the Official Committee of Tort Claimants to
amend the Dec. 21 bankruptcy court opinion was untimely (See March 2000,
Page 10).

(Supplement to Nevada claimants opening brief in Section A. Document #
18-000915-101. Dow Corning response in Section B. Document #
18-000915-102. Claimants reply in support of supplement to opening brief
is in Section C. Document # 18-000915-103.)

The supplement says the Sixth Circuit Telectronics opinion should be
applied to the Dow case. Telectronics, for the first time in the circuit,
gives plaintiffs the right to sue solvent parent companies, the brief

"One of the arguments advanced by the respondents to support the release
of the solvent third parties," the supplement says, "was that the third
parties had contributed to the 'limited fund,' that the parents would not
allow the defendant to settle unless the parents were released, that the
liability of the parents was tenuous, and that if this settlement was not
approved, the defendant might have to file for bankruptcy."

            Right To Litigate Against Parent Companies

"The Sixth Circuit held that the plaintiffs, in this country, had a right
to have their theories of liability against the parents determined at
trial and rejected each of the respondents' arguments in favor of the
settlement," the supplement says.

Telectronics does not apply to In re Dow, the response from the company
says. "In Ortiz," the response says, "on which Telectronics is based, the
Supreme Court specifically contrasted the limited fund class action under
Rule 23 with bankruptcy proceedings" (Ortiz v. Fibreboard Corp., 119
S.Ct. 2295, n. 34).

The Telectronics settlement, the Dow response says, does not provide an
opt out or protect the right to a jury trial to pursue actual damages
provided under the In re Dow Amended Joint Plan. The Eastern Michigan
Bankruptcy Court found, the response says, that "there was a more than
ample cushion to pay the awards that juries might issue in favor of
claimants who choose to litigate compensatory damage claims . . . ."

Claimants will be paid in full, the response says, so the release of
claims against the shareholders "does not prejudice the claimants . . .

                       Telectronics Unequivocal

In the Sept. 5 response, counsel for the Nevada claimants replies that
Telectronics is on target. Telectronics applies in bankruptcy, the
response says. "Telectronics shows unequivocally that the Sixth Circuit
agrees with Judge Spector's reasoning below on the unenforceability of
the third party injunction/release provisions in the Proponents' Plan of
Reorganization insofar as 'limited funds' concepts apply to both cases."

Judge Spector did not find, the claimants response says, that the limited
fund is sufficient to pay all claims. "Rather he found," the response
says, "that the estimates presented by the evidence showed that the $ 400
million Litigation Facility cap would be sufficient. An estimate is just
an estimate. As the Telectronics court found, no one can know if the fund
is adequate to pay mass tort claims until the claims have actually been

Ignoring the precedent of Telectronics, the response says, threatens the
labor of six years. "What is wrong is proponents' efforts to prevent tort
claimants with rights against the debtor and the debtor's parents from
continuing with their actions against the non-debtor parents where those
tort claimants did not signal their acceptance of this process by voting
for the debtor's plan."

                        Six Years Of Effort

"Proponents' attempts to throw away six years of effort because the
bankruptcy court did not release Dow Corning's parents from liability to
those claims who did not vote for the plan should be rejected and the
bankruptcy court's construction of @@ 8.3 and 8.4 of their plan should be

Geoffrey White of White and Meany in Reno, Nev., is tort counsel for the
Nevada Claimants. John A. White Jr. of White Law Chartered in Reno, Nev.,
is bankruptcy counsel for the Nevada Claimants. Robert Schneider is local
counsel for the Nevada Claimants in Detroit. George Tarpley and David
Ellerbe of Sheinfeld, Maley & Kay in Dalls represent Dow Corning Corp.
Kenneth H. Eckstein and Jeffrey S. Trachtman of Kramer, Levin, Naftalis &
Frankel in New York City represent the Tort Claimants Committee. Dennis
S. Meir and Alfred Lurey of Kilpatrick and Stockton in Atlanta and
Patrick L. Hughes of Verner, Lipfert, Bernhard, McPherson & Hand in
Houston is associate counsel for the Tort Claimants Committee. Edward
Blizzard and Dianna Pendleton of Blizzard & McCarthy in Houston are
office counsel. (Mealey's Breast Implants, September 15, 2000)

VIRTUALFUND COM: Retains Customers’ Claims on Sold out DGBU Unit
On October 21, 1999, the company announced the intention to sell the
Digital Graphics Business Unit (DGBU) assets and to focus future efforts
on further developing the ISBU. On June 13, 2000, the company completed
the sale of the DGBU assets to MacDermid Incorporated ("MacDermid").

The Company is involved in legal proceedings related to DGBU customers'
credit and product warranty issues in the normal course of business. In
accordance with the terms of the Asset Purchase Agreement between the
Company and MacDermid, the Company retains liability for certain claims
made by customers who purchased equipment from the DGBU prior to its sale
to MacDermid. In certain proceedings, the claimants have alleged claims
for exemplary or punitive damages which may not bear a direct
relationship to the alleged actual incurred damages, and therefore could
have a material adverse effect on the Company's business. However, at
this time none of the proceedings is expected to have a material effect
on the Company's operations or financial condition, the company claims.

               Shareholder’s Suit Resolved Long Ago

In October 1995, a shareholder of the company (Becker) filed an action
against the Company and four of its officers and directors alleging
violations of the Securities Exchange Act of 1934. In December 1995,
similar claims filed by other shareholders were consolidated into the
Becker claim as a class action to include all purchasers of the Company's
stock during the period of December 3, 1993 through December 8, 1994. The
basic allegation was that the Company and the named defendants knew of
material, negative, non-public information and withheld such information
from the market so that they could personally benefit by selling shares
of common stock over a one year period, prior to a drop in the stock

The Company and the insiders denied the allegations. A settlement in this
case was reached between the Company and the plaintiffs and was approved
in October 1997. The settlement included an amount from the Company's
insurance carrier and $636,000 from the Company. The Company's portion of
the proposed settlement was to be paid in cash or common stock at the
Company's discretion. The Company elected to contribute common stock and
issued 141,333 shares on June 30, 1998 in settlement of the obligation.
The Company recorded its $636,000 share of the proposed settlement as
expense included in discontinued operations and additional paid in
capital as of June 30, 1997.


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
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