CAR_Public/010118.MBX               C L A S S   A C T I O N   R E P O R T E R

              Thursday, January 18, 2001, Vol. 3, No. 13

                              Headlines

ART MODELL: Cleveland Fans Will Contest Former Browns Owner in Ohio Ct.
AURORA FOODS: Settles Shareholder Lawsuits in CA Re Former Management
COCA-COLA: Employees Face Decision, To Take Or Not Take Race Bias Pact
DRKOOP.COM: Struggling Health Web Site Closes TX Operations; Moves to CA
ENGLISH-ONLY: The NY Times Presents Interrelated Issues in Sandoval Case

FLEMINGTON PHARMACEUTICAL: Announces Settlement of Securities Suit in NJ
INDIANA CABLE: Ruling Denies Late-Fee Refund; Appeal Planned
INFINITY BROADCASTING: Reports on Suits & Events Re Viacom Proposal
INMATES LITIGATION: Parole Backlog Cleared; Advocates Point to Loopholes
J.C. NICHOLS: Opts To Settle Lawsuit Re 1998 Acquisition By Highwoods

LIFESCAN INC: J&J Subsidiary to Pay $60M Penalties In Blood Meter Case
LINCOLN PARK: Students' Action against Searches Granted Class Status
MAD CRAB: Ohio Court Certifies Class of Food Poisoning Victims
NEFF CORP.: Announces Shareholder Lawsuits Concerning URI Proposal
PHILIPS INTERNATIONAL: Amended Complaint Re Liquidation Filed in MD

PRI AUTOMATION: Schiffrin & Barroway Files Securities Suit in MA
SEMPRA, EL PASO: Documents and Notes Led to Energy Collusion Suits
SIMON TRANSPORTATION: Utah District Ct Dismisses Securities Lawsuit
TERAYON COMMUNICATION: Consolidated Securities Complaints Filed in CA
VERIZON: Cohen Milstein Files Securities Suit in District of Columbia

WEAPONS CONTRACTORS: Lawsuits Claim Radiation Effects & Discrimination

                               *********

ART MODELL: Cleveland Fans Will Contest Former Browns Owner in Ohio Ct.
-----------------------------------------------------------------------
Bitter Cleveland fans might still get a chance for some payback against
former Browns owner Art Modell, even if his Baltimore Ravens win the
Super Bowl.

A lawsuit brought by 1995 Browns season-ticket holders, who claim Modell
lied to them when he moved the old Cleveland franchise to Baltimore, will
go to trial on March 19.

The fans are seeking $6.4 million in damages, which might just be enough
to ease Clevelanders' pain if the team that used to be their own beats
the New York Giants and wins the NFL title.

Modell's attorneys argued in Cuyahoga County Common Pleas Court on
Tuesday that the case shouldn't get that far. They told Judge Kenneth
Callahan the case should be thrown out before it goes to trial. After an
hour-long hearing, Callahan did not say when he would rule on their
request.

Season-ticket holders originally sued Modell on the same day - Nov. 6,
1995 - that he announced he was moving his Browns to Baltimore. The case
has been kicking around the legal system ever since.

The Browns fans accuse Modell of misleading them by saying publicly he
would never move the team while he was privately arranging to bolt from
Cleveland. Modell also deprived fans of the right of first refusal to buy
1996 season tickets, the lawsuit says.

The class-action suit is on behalf of 11,000 Cleveland season-ticket
holders for 1995, who controlled about 39,000 seats at the old Cleveland
Municipal Stadium.

Having the chance to keep good seats for upcoming years is a big part of
the reason to get season tickets in the first place, said Michael
Saltzman, a season-ticket holder for 29 years, who had 40-yard line seats
when Modell left.

Saltzman bought season tickets for the new Browns, who returned to the
NFL in 1999 under the ownership of former Modell partner Al Lerner, but
they're on the 20.

"I think he (Modell) committed fraud," said Saltzman, who watched
Tuesday's hearing.

Ravens lawyers told Callahan it's clear Modell and others indicated the
Browns could move if negotiations on a new stadium or renovations fell
through.

"We clearly don't think there was any fraud by Mr. Modell," Modell
attorney Mark Gately said after the hearing. "We think the evidence shows
that."

Gately also denied 1995 season-ticket holders had first rights to season
tickets the following year.

He called the fans' request for punitive damages "outrageous." He said
the season-ticket holders were using laws meant for much more serious
cases, such as when people are exposed to asbestos, to try to win money
for football seats. (The Associated Press, January 17, 2001)


AURORA FOODS: Settles Shareholder Lawsuits in CA Re Former Management
---------------------------------------------------------------------
Aurora Foods Inc. (NYSE: AOR) announced on January 16 it has reached a
preliminary agreement to settle the securities class action and
derivative lawsuits pending against the Company and its former management
team in the US District Court in the Northern District of California.
These actions were commenced in the wake of Aurora's disclosure on
February 18, 2000, of accounting irregularities at the Company and the
resignation of the Company's former senior management team.

Under terms of the agreement, Aurora will pay the class members $26
million in cash and $10 million in common stock. Separately, the Company
has entered into a preliminary agreement with certain members of former
management to transfer between approximately 3 million and 3.6 million
shares of Aurora common stock to the Company, in consideration for a
resolution of any civil claims that the Company may have, and partially
conditioned upon future events and circumstances. The cash component of
the settlement with the Company's shareholders will be funded entirely by
the Company's insurance. With respect to the stock component of the
settlement, the stock received from former management would be
sufficient, at current share prices, to satisfy Aurora's obligation
without issuing additional shares. The actual number of shares needed to
fund this component will be based on average share prices determined at
later dates.

In addition, the Company has agreed to continue to implement certain
remedial measures, including the adoption of an audit committee charter,
the reorganization of its finance department, the establishment of an
internal audit function and the institution of a compliance program, as
consideration for resolution of the derivative litigation.


COCA-COLA: Employees Face Decision, To Take Or Not Take Race Bias Pact
----------------------------------------------------------------------
It's decision time for some 2,000 current and former Coca-Cola workers
covered by a record $ 192.5 million racial discrimination settlement.

Coca-Cola mailed court-approved notices Tuesday to salaried African-
American employees in the United States who worked for the company any
time between April 22, 1995, and June 14, 2000. Members of the
class-action case have until March 19 to decide on one of four basic
options:

    -- To agree to the terms, which provide an average of about $ 40,000
for each class member. A formula, partly based on a class member's length
of service and pay, has been developed.

    -- To accept a partial settlement averaging about $ 28,000. Class
members who think they have strong evidence they were discriminated
against in a prior promotion decision can then take their promotion case
to a U.S. magistrate judge in an expedited procedure.

    -- To "opt out" of the settlement, allowing the person to file an
individual suit for monetary damages. Already pending is a separate
lawsuit by four former African-American employees.

    -- To file an objection to the settlement but remain part of the
class. If the settlement is approved, those who object are part of it and
cannot opt out.

A "fairness hearing" before U.S. District Judge Richard Story has been
set for May 29. Story will consider evidence about whether the settlement
is fair and reasonable before deciding whether to give it final approval.

Coca-Cola has the right to declare the settlement void if more than 200
class members opt out. Company spokesman Ben Deutsch, however, said "this
is a right but not an obligation. We will evaluate this situation if and
when it becomes a reality." (The Atlanta Journal and Constitution,
January 17, 2001)


DRKOOP.COM: Struggling Health Web Site Closes TX Operations; Moves to CA
------------------------------------------------------------------------
The struggling health Web site co-founded by the former U.S. surgeon
general C. Evererett Koop of Hanover, N.H., is closing its Texas
headquarters, laying off 45 workers and moving to Santa Monica, Calif.

Drkoop.com president Ed Cespedes said in a statement that closing its
Austin operations will reduce overhead costs "and put our people near
where our clients and strategic partners are located."

The company's medical content development, the thrust of its business, is
in Santa Monica.

Drkoop.com plans to expand its business beyond just a content-based Web
site by partnering with other companies to sell technology, health
content and hosting services and health management, Cespedes said.
Cespedes would not provide further details of those plans.

Analysts long have said that the company had to expand its business to
stay alive.

The closure and lack of specifics about future plans show the Web company
is still in critical condition, said Claudine Singer, senior health care
analyst for Jupiter Research. "What the company needs to demonstrate is a
clear-cut strategy to turn its fortunes around, and none is in evidence.
It's great to strive for cost efficiencies but that alone does not a
business model make," she said.

Cespedes said only "a certain number" of the 100 Austin-based employees
will be offered transfers to California or Philadelphia, where the
company announced some of its sales and business development operations
will be located.

The move will reduce the company's monthly cash expenses to less than $1
million, down from a high of $8 million per month last March, the company
said.

The shutdown is the latest ailment in the company's troubled 2-year
history. Last month, drkoop.com announced it was scrambling to keep from
losing its listing on the Nasdaq Stock Market. Company officials proposed
to its board a reverse stock split that would increase share value to
above the $1 minimum by decreasing the number of shares outstanding.

Nasdaq can delist companies whose stock price falls below $1 for 30
straight trading days. Drkoop faces being bumped off the board as early
as February.

On Tuesday, drkoop.com rose 9.4 cents, or 23 percent, to close at 50
cents per share on the Nasdaq Stock Market. When it went public in July
1999, drkoop.com stock sold as high as $45. It has been below $1 since
Oct. 18, when shares closed at 90.6 cents.

Several shareholders sought class-action status in a lawsuit claiming the
company made false promises when it went public. The lawsuit is still
pending.

In April, officials announced the company only had enough cash to survive
until August. The announcement came after the company disclosed in March
that its auditors had cast doubt on its ability to remain in business.
The company laid off a third of its work force in August and hired a new
management team.

The company was co-founded in 1999 by Koop, U.S. surgeon general from
1982 to 1989. Koop now heads the Koop Institute at Dartmouth College.
(The Associated Press State & Local Wire, January 17, 2001)


ENGLISH-ONLY: The NY Times Presents Interrelated Issues in Sandoval Case
------------------------------------------------------------------------
In his final appearance representing the government before the Supreme
Court, Solicitor General Seth P. Waxman urged the justices not to
repudiate more than 25 years of legal precedents that have permitted
individuals to sue states to prevent violations of federal civil rights
regulations, the New York Times reports.

The Clinton administration was aligned against Alabama in a complex case
with significant implications for both federalism and civil rights
enforcement, the report says.

The case began four years ago as a dispute over Alabama's newly enacted
requirement that people applying for driver's licenses demonstrate
proficiency in English, the only such requirement in the country. A
federal appeals court's ruling last year that the language requirement
violated federal antidiscrimination regulations turned the case into a
rallying point for the English-only movement.

According to the New York Times, there was no mention in the courtroom of
the English-only issue or, indeed, any of the facts of the class-action
lawsuit, brought against the state on behalf of immigrants who could not
demonstrate English proficiency at the required 10th-grade level. The
focus of the justices' interest was entirely on the legal questions
raised by the case and on the implications of accepting Alabama's
argument that the lower courts should never have permitted the lawsuit to
proceed in the first place.

Yesterday, the CAR included a report on the case under the heading
"Lawyers Urge Supreme Court to Focus on Right to Sue in Anti-Bias Case."

The New York Times says that there are several interrelated issues in the
case, Alexander v. Sandoval, No. 99-1908.

   -- The first is whether the lower federal courts have correctly ruled,
in cases going back to the 1960's, that individuals may sue states under
Title VI of the Civil Rights Act of 1964, a law that prohibits recipients
of federal grants from discriminating on the basis of race or national
origin.

   -- A second issue is whether, even if private suits are generally
permissible under Title VI, they can be brought for violations of
regulations that federal agencies have issued to implement the law and
that go beyond the statute itself.

   -- A further issue lying under the surface of the case is whether
agencies can issue regulations that carry federal enforcement authority
further than Congress has explicitly authorized; in the case of Title VI,
the statute itself prohibits only intentional discrimination, while
regulations to implement it issued by the Departments of Justice and
Transportation also bar actions that have a discriminatory effect,
without requiring proof of intent.

Not so many years ago, the answer from the Supreme Court to all these
questions would indisputably have been yes. But today, each issue
resonates with a different aspect of the court's renewed debate over
states' rights and Congressional authority, and the outcome is far from
certain.

Jeffrey S. Sutton, arguing Alabama's appeal, told the justices that in
ruling against the state, the United States Court of Appeals for the 11th
Circuit had ignored the fact that "states are not run-of-the-mill civil
defendants" but rather are "co-equal sovereigns."

Permitting such lawsuits "alters the federal-state balance," Mr. Sutton
said.

Mr. Sutton, formerly Ohio's solicitor general, is now in private practice
and is also representing Alabama in a major federalism case under the
Americans With Disabilities Act. That case was argued before the court in
October and is awaiting decision.

The first prong of Mr. Sutton's argument on January 17 was that in
enacting Title VI, Congress never explicitly granted a "private right of
action" to individuals to sue states or anyone else. The law was passed
under Congress's spending power, and the sanction it provides is the
cutoff of federal money to a program that is misusing its federal grant
to support discriminatory policies.

"When you alter the federal-state balance, Congress has to be
unmistakable about what it's doing," Mr. Sutton said.

Justice Stephen G. Breyer told him, "You're reading a lot of
complications into a silence."

The second prong of Mr. Sutton's argument was that even if there is an
implied right to sue under Title VI, that right does not extend as far as
regulations that prohibit more than intentional discrimination.

In challenging this argument, Solicitor General Waxman told the justices
that it ran counter to the court's "completely unbroken practice of
enforcing obligations equally whether they arise under statutes or
regulations."

Mr. Waxman said that to accept Alabama's position would be to "drive a
wedge right through the heart of this court's cases that hold that
substantive regulations mandated by statute have the force of law."
Section 602 of Title VI requires "each federal department and agency"
affected by the law to issue regulations "which shall be consistent with
achievement of the objectives of the statute."

A separate federal law generally known as Title IX, which bars sex
discrimination in education programs that receive federal money, was
based on Title VI and would also be affected by the court's ruling in
this case.

Mr. Waxman told the court that the case had "very, very broad
ramifications" beyond the civil rights laws for enforcing "regulatory
obligations against the states," for example, under the federal Medicare
statute and regulations.

The case has drawn many friend-of-the-court briefs that alert the court
to implications for current lawsuits over land use, school financing and
academic standards for college athletes.

The lead plaintiff in the case, Martha Sandoval, represented at the court
on January 17 by Eric Schnapper, is a permanent resident who came to the
United States from Mexico in 1987. She knows enough English to read road
signs but does not read English at the high school level required to pass
Alabama's test. (The New York Times, January 17, 2001)


FLEMINGTON PHARMACEUTICAL: Announces Settlement of Securities Suit in NJ
------------------------------------------------------------------------Flemington
Pharmaceutical Corp. (OTCBB: "FLEM" "FLEMW") announced that it has
settled a class action lawsuit filed against it and two of its Officers
and Directors in 1998.

The Company previously had announced that on November 8, 2000 the United
States District Court for the District of New Jersey had denied the
plaintiff's Motion for Class Certification. At the time of the
settlement, the Company had pending a Motion for Summary Judgment. The
Company's President, Dr. Harry A. Dugger III said, of the settlement:
"While I and our attorneys believe the Company ultimately would have
prevailed in this litigation, it is in the best interest of the Company
and its shareholders to put this matter behind us. The lawsuit has been
dismissed with prejudice. While the settlement agreement requires that
the exact terms remain confidential, I think I can safely say that I
consider the terms of settlement to be highly advantageous to the
Company."

Flemington is engaged in the development of novel drug delivery systems
for presently marketed prescription and over-the-counter drugs. The novel
delivery systems include lingual sprays and soft gelatin bite capsules.
The Company believes these delivery systems offer (I) improved drug
safety by reducing the required dosage, therefore reducing side effects;
(ii) improved dosage reliability; (iii) improved patient convenience and
compliance; and (iv) enhanced dosage reliability. The Company plans to
develop such products through collaborative arrangements with major
pharmaceutical companies.


INDIANA CABLE: Ruling Denies Late-Fee Refund; Appeal Planned
------------------------------------------------------------
The Indiana Court of Appeals has handed Indiana cable customers a partial
defeat in their bid to recoup past late fees. In an opinion released
Tuesday by Judge Carr Darden, the court ruled that Time Warner Cable
subscribers do not have the right to compensation for past late fees. But
the court also returned the case to the Marion County courts to determine
whether the company needs the late fees to cover its costs.

A group of Indianapolis customers sued Time Warner in 1998 for allegedly
overcharging those who pay their bills late.

Irwin Levin, an Indianapolis lawyer representing plaintiffs Kelly J.
Whiteman and Jean Wilson, is seeking class-action status for all of Time
Warner's Indiana customers. He said he plans to appeal the court's late
fees decision to the Indiana Supreme Court. "This is a very anti-consumer
doctrine," Levin said. "Any time you pay for anything, and you find out
that you shouldn't have paid the money - but you paid it voluntarily -
you can't get it back."

Time Warner said the late fee covers expenses the company incurs when
customers don't pay promptly.

A Marion Superior Court will soon hear statistical evidence that the
cable company already charges its customers more than enough to make ends
meet - and that its $4.65 late fee is unwarranted.

The company isn't worried about its case. "We feel very confident that
our position was correct, is correct, and will be correct," said Buz
Nesbit, Time Warner's division president. (The Associated Press State &
Local Wire, January 17, 2001)


INFINITY BROADCASTING: Reports on Suits & Events Re Viacom Proposal
-------------------------------------------------------------------
In August 2000, at least sixteen putative class action lawsuits were
filed against Infinity, members of Infinity's board of directors, and
Viacom in the Court of Chancery of the State of Delaware and the Supreme
Court of the State of New York. Details of certain of these lawsuits have
been previously reported in the CAR.

On August 31, 2000, the Court of Chancery of the State of Delaware issued
an Order consolidating the eleven actions filed in that state.

On October 5, 2000, Viacom provided to counsel representing plaintiffs in
the consolidated stockholder litigation in Delaware confidential due
diligence information and financial analyses concerning the proposed
merger.

                  Events Related to Viacom Proposal

On October 6, 2000, representatives of Bear Stearns, Deutsche Banc Alex.
Brown and Skadden Arps met with representatives of Viacom, Goldman Sachs
and Shearman & Sterling to discuss the special committee's views
regarding the Viacom proposal and the exchange ratio proposed by Viacom.
After a lengthy discussion, the special committee's co-financial advisors
informed Viacom and Goldman Sachs of the special committee's view that
the exchange ratio to be paid by Viacom would need to be increased for
the special committee to recommend the proposed transaction. In response,
representatives of Viacom expressed the view that the exchange ratio of
0.564 of a share of Viacom Class B common stock per share of Infinity
Class A common stock, as indicated in the Viacom proposal, represented
full and fair value for the shares of Infinity Class A common stock.
Representatives of Viacom and Goldman Sachs then engaged in discussions
with the special committee's legal and co-financial advisors regarding
the available Wall Street research analyst estimates, and adjustments
thereto, considered by the special committee and its co-financial
advisors in evaluating the Viacom proposal. Representatives of Viacom
then invited the special committee's co-financial advisors to continue
their discussions with representatives of Goldman Sachs regarding such
estimates and adjustments thereto.

On October 8, 2000, the special committee held a meeting to discuss with
its legal and co-financial advisors the outcome of the October 6th
discussions with Viacom and Goldman Sachs and to formulate a response to
those discussions. From October 8, 2000 through October 16, 2000,
representatives of Bear Stearns and Deutsche Banc Alex. Brown held a
number of discussions with representatives of Viacom and Goldman Sachs.

On October 16, 2000, the special committee again met with its legal and
co- financial advisors to review the recent discussions between
representatives of Bear Stearns and Deutsche Banc Alex. Brown and
representatives of Viacom and Goldman Sachs. The co-financial advisors
informed the special committee that, while they had several discussions
with representatives of Goldman Sachs and Viacom, the co-financial
advisors still believed that an exchange ratio in excess of that proposed
in the Viacom proposal was appropriate and that Viacom had not as yet
revised its offer. Following this discussion, representatives of Viacom
and Goldman Sachs joined the meeting telephonically to discuss the
special committee's views on the Viacom proposal. The special committee
informed senior executives of Viacom that the exchange ratio proposed by
Viacom would need to be increased for the special committee to recommend
the transaction. The senior executives of Viacom stated that Viacom would
not be willing to agree to an increase in the exchange ratio. At the
conclusion of this teleconference, the special committee directed its
co-financial advisors to again meet with representatives of Goldman
Sachs.

On October 16, 2000, representatives of Skadden Arps provided additional
comments regarding the draft merger agreement to representatives of
Shearman & Sterling.

During the morning and early afternoon of October 17, 2000,
representatives of Bear Stearns and Deutsche Banc Alex. Brown again held
discussions with representatives of Viacom and Goldman Sachs. Later in
that day, the special committee held discussions with its legal and
co-financial advisors to review their conversations with representatives
of Viacom and Goldman Sachs. The co- financial advisors informed the
special committee that, although some progress had been made, no
agreement had as yet been reached regarding the exchange ratio to be paid
by Viacom. At the conclusion of this meeting, the special committee
directed its co-financial advisors to inform Viacom that, in light of the
discussions that had occurred over the previous several days, the special
committee would be willing to consider less of an increase in the
exchange ratio than it had previously considered, but that Viacom would
nevertheless need to increase the exchange ratio for the special
committee to recommend the proposed transaction.

During the morning of October 23, 2000, the special committee again met
with its legal and co-financial advisors to review the recent discussions
between representatives of Bear Stearns and Deutsche Banc Alex. Brown and
representatives of Goldman Sachs. At that meeting, the co-financial
advisors informed the special committee that although the parties had
made substantial progress, there still remained some disagreements
regarding the appropriate adjustments to the available Wall Street
research analyst estimates considered by the special committee and its
co-financial advisors in evaluating the Viacom proposal. At the
conclusion of the meeting, the special committee determined to meet
directly with senior executives of Viacom in an effort to resolve this
impasse. Following the special committee meeting, representatives of Bear
Stearns and Deutsche Banc Alex. Brown contacted representatives of
Goldman Sachs and established a meeting between the special committee and
representatives of Viacom to be held later that day.

Early in the evening on October 23, 2000, the special committee met with
its legal and co-financial advisors to prepare for the scheduled meeting
between the special committee and representatives of Viacom. Immediately
thereafter, the members of the special committee met with senior
executives of Viacom, including Mr. Karmazin, and reiterated their view
that the exchange ratio to be paid by Viacom would need to be increased
for the special committee to recommend the proposed transaction. Senior
executives of Viacom again expressed the view that the exchange ratio
initially proposed by Viacom was full and fair. Messrs. Karmazin, Gordon
and Sherman then engaged in substantial discussions, at the conclusion of
which Mr. Karmazin indicated that he would be willing to seek approval
from the Viacom board to make a proposal for an exchange ratio of 0.592
of a share of Viacom Class B common stock per share of Infinity Class A
common stock, subject to the special committee's willingness to recommend
a transaction to the Infinity board of directors based on such an
exchange ratio and the finalization of the terms of the merger agreement.
Messrs. Gordon and Sherman indicated that they would be willing to
recommend such a transaction, subject to the ability of the special
committee's co-financial advisors to render opinions as to the fairness
of the improved exchange ratio from a financial point of view to the
Infinity public stockholders and the finalization of the terms of the
merger agreement.

On October 24, 2000, at a special telephonic meeting of the Viacom board
of directors, senior executives of Viacom presented to the board the
current status of discussions regarding the proposed merger. After
discussion and deliberation, the Viacom board authorized senior
management to continue discussions with the special committee of the
Infinity board.

From October 24th through October 30th, representatives of Shearman &
Sterling and counsel representing plaintiffs in the consolidated
stockholder litigation brought against Infinity, its directors and Viacom
in connection with the proposed merger held discussions and conducted
negotiations regarding the proposed merger and the possible settlement of
such litigation.

On October 25, 2000, representatives of Shearman & Sterling, Goldman
Sachs, Fried, Frank, Harris, Shriver & Jacobson, counsel to Goldman
Sachs, and Morris, Nichols, Arsht & Tunnell, special counsel to Viacom,
met with counsel representing plaintiffs in the consolidated stockholder
litigation brought against Infinity, its directors and Viacom in
connection with the proposed merger, and representatives of W.L. Ross &
Co., financial advisor to those plaintiffs. At this meeting, plaintiffs'
counsel expressed the view that the consideration to be paid by Viacom
pursuant to the original Viacom proposal was inadequate.

On October 26, 2000, representatives of Skadden Arps, Bear Stearns and
Deutsche Banc Alex. Brown met with representatives of W.L. Ross and
counsel representing plaintiffs in the consolidated stockholder
litigation. Again, plaintiffs' counsel expressed the view that the
initially proposed exchange ratio was inadequate. On October 27, 2000,
however, after reviewing additional information and giving further
consideration to the revised terms of the Viacom proposal, plaintiffs'
counsel and their financial advisors informed representatives of Shearman
& Sterling and Skadden Arps that the plaintiffs would be willing to
settle the consolidated stockholder litigation on the basis of the
increased exchange ratio negotiated by the special committee.

During the period from October 28, 2000 through October 30, 2000,
representatives of Skadden Arps and the special committee finalized the
terms of the merger agreement with representatives of Shearman & Sterling
and Viacom.

On October 30, 2000, representatives of Shearman & Sterling and counsel
representing plaintiffs in the consolidated stockholder litigation
reached an agreement in principle on the terms of a settlement of the
litigation. Later in the day on October 30, 2000, senior executives of
Viacom met with members of the special committee and made a revised offer
from Viacom at an exchange ratio of 0.592 of a share of Viacom Class B
common stock per share of Infinity Class A common stock.

On October 30, 2000, the special committee met with representatives of
Bear Stearns, Deutsche Banc Alex. Brown and Skadden Arps. At the October
30th special committee meeting, representatives of Bear Stearns and
Deutsche Banc Alex. Brown each orally advised the special committee that
the exchange ratio of 0.592 of a share of Viacom Class B common stock to
be paid to the holders of outstanding Infinity Class A common stock in
the merger was fair to such holders, other than Viacom and its
affiliates, from a financial point of view, which opinions were
subsequently confirmed in writing. The special committee then unanimously
determined that the merger was fair to, and in the best interests of,
Infinity and its public stockholders, determined that the merger and the
merger agreement should be approved and declared advisable, and
recommended that the board of directors of Infinity approve and declare
the advisability of, the merger and the merger agreement.

Later in the evening on October 30, 2000, Infinity's board of directors
convened a meeting. The Infinity board received the recommendation of the
special committee and reviewed the terms of the merger agreement. After
the directors were given an opportunity to ask questions regarding the
merger agreement and the proposed merger, the board, by a unanimous vote
of those directors who were present and did not abstain, determined that
the merger was fair to, and in the best interests of Infinity and its
public stockholders, approved and declared the advisability of the merger
and the merger agreement, and recommended that Infinity's stockholders
consent to the approval of the merger and adoption of the merger
agreement. Of the ten directors then comprising Infinity's board of
directors, one director (Arturo R. Moreno) was absent from the meeting
and one director (William S. Levine) abstained from voting on the Viacom
merger.

On October 30, 2000, Viacom's board of directors by written consent
unanimously determined that the merger was fair to, and in the best
interests of, Viacom and its stockholders, declared the advisability of
the merger agreement and approved the merger agreement.

In the evening of October 30, 2000, Viacom and Infinity executed the
definitive merger agreement, and on the morning of October 31, 2000 they
issued a joint press release announcing the execution of the merger
agreement.

On December 8, 2000, CBS Broadcasting, Inc., a wholly owned subsidiary of
Viacom that holds 100% of the outstanding shares of Infinity Class B
common stock representing approximately 90% of the combined voting power
of all outstanding Infinity shares, granted its written consent to the
adoption of the merger agreement and the approval of the merger. On
December 11, 2000, Infinity and Viacom mailed to Infinity's stockholders
an information statement/prospectus informing them of the action taken by
CBS Broadcasting, Inc.

On January 4, 2000, Viacom and Infinity, with the concurrence of the
special committee of Infinity's board of directors, decided to seek
approval of the merger by Infinity's minority stockholders after a recent
Delaware Chancery Court decision involving corporations unrelated to
Viacom or Infinity (In re: Digex, Inc. Shareholders Litigation). Although
neither Infinity nor Viacom is involved in the Digex litigation, the
decision has created uncertainty about whether Section 203 of the
Delaware corporation law requires that Infinity's minority stockholders
approve the merger. On the same day, Viacom entered into a voting
agreement with Messrs. Levine and Moreno pursuant to which each
stockholder agreed to vote his shares of Infinity Class A common stock in
favor of the merger and the merger agreement.

On January 5, 2000, Viacom and Infinity issued a press release announcing
that Infinity would call a stockholders' meeting in order to seek
approval of the merger by holders of 66 2/3% of its outstanding voting
shares, other than those shares owned by Viacom or subject to the voting
agreement between Viacom and Messrs. Levine and Moreno.

Viacom's Reasons for the Merger are presented in Infinity’s report to the
SEC at
http://www.sec.gov/Archives/edgar/data/1070518/0000950130-01-000170.txt


INMATES LITIGATION: Parole Backlog Cleared; Advocates Point to Loopholes
------------------------------------------------------------------------A
backlog of state inmates awaiting parole hearings has been cleared,
officials said, but if the state falls behind again it might have to pay
for it, with cash.

A lawsuit settlement approved in federal court Tuesday requires the state
to pay an inmate advocacy organization $ 17.50 a day every time a
prisoner doesn't have a timely parole hearing, but some critics of the
settlement said it still provides too many loopholes for the state. The
settlement, approved in Camden by U.S. District Judge Joel Pisano, ends a
class-action lawsuit brought by inmates who complained that they were
waiting months, and in some cases up to two years, for overdue parole
hearings.

The backlog contributed to the forced resignation of state Parole Board
Chairman Andrew Consovoy last year. When the suit was filed, Consovoy
reportedly told Governor Whitman's top aides only a few hundred cases
were backlogged, when in fact the figure was in the thousands.

After Whitman administration officials also learned that Consovoy was
under investigation by the state police for allegedly helping members of
organized crime get out of prison early, he was ordered to resign.

At Tuesday's hearing, Parole Board Chairman Mario Paparozzi told Pisano
that the last eight overdue parole hearings were held Saturday, clearing
a backlog that had totaled 3,400 inmates last spring.

Both Paparozzi and Stephen Phillip Fuoco, who represented inmates, called
the settlement fair. "Folks were seeking justice," Paparozzi said. He
apologized to all the inmates affected by the lawsuit.

But Ian Hawker, one of several prisoners who brought the lawsuit,
complained about the settlement, saying the $ 17.50 a day should be paid
directly to prisoners. Instead, the money would go to a prison rights
organization, the Prisoners Resource Center in Newark. Hawker also said
inmates had little contact with Fuoco and were not kept up to date with
the fine points of the settlement.

Elaine Selan, an advocate who runs a prisoner advocacy group called "And
Justice For All,"also objected in court, saying the structure of the
settlement would make it impossible for the Prisoners Resource Center to
collect any money.

Under the settlement, the organization would receive money only if the
state did not answer a letter from an inmate awaiting an overdue parole
hearing within 45 days. Once the state responded, it would then have 120
days to schedule a hearing.

Selan said some inmates never received notice of the settlement because
it was not posted in the law libraries in two prisons, East Jersey State
Prison in Woodbridge and Riverfront State Prison in Camden.

Pisano said the settlement was in the"public interest,"and noted that
less than 300 of the 5,817 inmates who were subject to overdue parole
hearings had objected to the settlement. (The Record (Bergen County, NJ),
January 17, 2001)


J.C. NICHOLS: Opts To Settle Lawsuit Re 1998 Acquisition By Highwoods
---------------------------------------------------------------------
J.C. Nichols has agreed to pay $5.7 million to settle a class-action
lawsuit accusing the company of securities fraud in connection with its
1998 acquisition by Highwoods Properties Inc. The settlement agreement
was reached before the case was scheduled to go to trial Tuesday in
federal court in Kansas City, Kan.

The lawsuit stemmed from Nichols' 1998 merger with Highwoods, a Raleigh,
N.C.-based real estate investment trust that acquired Nichols for $65 a
share. The suit, filed in January 1998 by Nichols shareholder John Flake,
alleged that the price was inadequate and that Nichols tried to prevent
shareholders from entering into more-favorable deals for their stock.

In October 1999, U.S. District Judge Kathryn Vratil certified the case as
a class action on behalf of Nichols shareholders and members of Nichols'
employee stock ownership plan. The plan's class had as many as 600
members, ranging from Nichols managers to one-time maids and maintenance
workers at old Nichols-owned hotels and other properties.

The settlement agreement, reached January 12 morning, came after Vratil
issued separate rulings on Dec. 15 and Jan. 11 narrowing the scope of the
plaintiffs' case. Vratil earlier had dismissed claims that Nichols and
Highwoods misled shareholders about the Highwoods deal, but refused to
throw out some of the plaintiffs' securities fraud allegations.

Both sides said they were satisfied with the settlement, which averted a
trial that had been expected to last at least three weeks.

The settlement works out to $1.76 a share for members of the plaintiff
class over and above the $65 they received from Highwoods. After legal
fees and other costs are subtracted, the settlement works out to about $1
a share.

That's considerably less than the upper range of damages sought by the
plaintiffs, or $10 a share, which was the difference between Highwoods'
offer and a $75-a-share offer made by Intell Management Investment Co. of
New York.

The plaintiffs' damage claim was dealt a blow by Vratil's Jan. 11 ruling,
which said no reasonable jury could have inferred from Intell's stated
"intent" to acquire Nichols "that Intell likely would have completed the
future deal at $75 per share."

The settlement must be approved by Vratil, who is expected to schedule a
hearing within a few weeks to rule on its fairness. Notice of the
settlement agreement will be sent to class members once it is approved.

The case was originally filed in state court by Flake, who died last
April and was replaced as a plaintiff by his estate. It was moved to
federal court in late 1998 after Flake amended the complaint to include
federal securities violations and other claims.

Besides Nichols and Highwoods, the suit named as defendants Nichols'
directors at the time of the Highwoods deal.

The suit stemmed from events in 1994 and 1995, when Nichols turned down a
takeover bid by Allen & Co., a New York investment banking firm. Allen
then sued Nichols, exposing insider transactions that allegedly benefited
Nichols chief Lynn McCarthy and other top Nichols executives at the
expense of company shareholders.

The Allen suit triggered additional litigation by Nichols against
McCarthy and by the employee stock ownership plan against Nichols.
McCarthy and other top Nichols officials were ousted in mid-1995, and the
civil suits were resolved as part of a settlement that called for the
unwinding of the insider transactions.

McCarthy, former Nichols Chief Financial Officer Walter Janes and former
Nichols attorney Charles Schleicher were indicted nearly a year ago on
criminal conspiracy charges growing out of the civil lawsuits. The three,
who have pleaded not guilty, are scheduled to go on trial April 23. (The
Kansas City Star, January 17, 2001)


LIFESCAN INC: J&J Subsidiary to Pay $60M Penalties In Blood Meter Case
----------------------------------------------------------------------
A Johnson & Johnson subsidiary last month agreed to plead guilty to
criminal charges and to pay criminal and civil penalties of $ 60 million
for failing to tell the FDA about problems with its SureStep blood
glucose monitor and providing the agency with false or misleading
information (United States of America v. LifeScan Inc., No. CR
00-20356-JF, N.D. Calif., San Jose Div.).

The plea agreement was the result of a federal criminal investigation and
a qui tam lawsuit filed by a former clinical researcher and a chemist of
LifeScan Inc., a wholly owned subsidiary of Johnson & Johnson.

A plea agreement filed on Dec. 15 indicated that LifeScan knew before
receiving 501(k) approval that the device gave inaccurate readings if
test strips were not fully inserted and that high blood sugar could
display a misleading "Error 1" message instead of a "HI" message. It says
the FDA was not told of the problems.

                         No Older Stock Recall

In addition, the agreement states that while LifeScan included warnings
about strip insertion with new strips, it did not recall older stock
without the warnings.

When consumers reported Error 1 problems to LifeScan, the agreement says
the company failed to file Medical Device Reports with the FDA or to
recall the devices, even on advice of a company medical officer.

SureStep monitors made before August 1997 were recalled in 1998 (See
6/19/98, Page 23). A few months later, the FDA issued a Class I recall
(See 8/17/98, Page 19). According to the plea agreement, the recall
occurred after the federal government began its investigation.

At the time, two deaths were reported attributed to the SureStep monitor.
The plea agreement mentions no deaths, only hospitalizations for
hyperglycemia.

A RICO class action was certified by the U.S. District Court for the
Northern District of California in San Jose. The Ninth Circuit U.S. Court
of Appeals recently denied review of the class certification (See
11/16/00, Page 17).

On Dec. 14, the United States filed a criminal information charging
LifeScan with three misdemeanor violations of federal law for introducing
an adulterated or misbranded medical device into interstate commerce, for
failing or refusing to furnish appropriate notifications to the FDA and
for submitting false and misleading reports to the FDA.

                      Developmental Problems

According to the plea agreement filed Dec. 15, LifeScan learned that the
SureStep monitor was defective while it was under development in 1993. It
said that when blood glucose levels exceeded 500 milligrams per deciliter
(mg/dl), the meter sometimes displayed an ER1 or Error 1 message instead
of an "HI" message. Error 1, the agreement says, signaled several
potential problems, but one was not high blood sugar.

In addition, the agreement says LifeScan knew that when a test strip
containing some of a patient's blood was not completely inserted into the
meter, it sometimes produced low blood sugar readings. The agreement says
that despite that knowledge, LifeScan did not tell consumers about the
problem with improperly inserted strips.

In October 1993, the agreement says LifeScan directed an engineer to fix
the Error 1 problem, but he or she did not. LifeScan submitted a 510(k)
application in May 1994, the agreement says, but did not tell the FDA
about the two problems. The FDA approved the device in March 1995.

                       Defects Not Disclosed

The device was marketed in the United States in May 1996, the agreement
says, but LifeScan did not disclose either defect until late 1997 or
early 1998.

While developing a version of the SureStep for health care professionals,
the agreement says that a scientist found the prototype had the same
Error 1 defect as the approved SureStep in 1996.

In February 1997, the agreement says LifeScan's Japanese affiliate
notified the company about the Error 1 problem but the meters were not
recalled because "it did not consider the ER1 problem to constitute a
risk to health."

Later that month, the agreement says LifeScan's president, vice president
of quality assurance and regulatory affairs, vice president of research,
development and engineering, the director of regulatory affairs and
others discussed the decision to submit certain data to the FDA about the
strip insertion problem. A 510(k) application was submitted for the
health care SureStep later that month without disclosing either problem.

                      Services Reps Notified

In July 1997, the agreement says LifeScan customer service
representatives were given instructions for dealing with consumers who
called about the Error 1 problem.

The Error 1 problem was corrected in July 1997, the agreement says. In
November 1997, it says LifeScan began including inserts about the Error 1
problem in packages of test strips, but did not pull old stock that
didn't have that insert.

In late 1997, LifeScan redesigned the test strips to address the
insertion problem, the agreement says. It reinforced instruction on
inserting test strips but did not recall old stock or advise consumer
about possible low readings.

The agreement says that after the government began investigating problems
with LifeScan's products, the company voluntarily recalled SureSteps made
before July 1997.

Between 1996 and 1998, LifeScan said it received more than 2,000
complaints of inaccurate low reading, some of which were attributable to
strip insertion problems. It also said it received more than 700
complaints about Error 1 messages, some of which were attributable to
high blood glucose. It told the FDA that it received 61 Error 1
complaints between May 1996 and July 1998 associated with illness, injury
and hospitalizations.

                  FDA Reports Withheld, Falsified

LifeScan admits in the plea agreement that it failed to file Medical
Device Reports with the FDA or filed reports with false, incomplete
and/or misleading information about the two problems.

In four cases involving unidentified consumers, the agreement says some
consumers called LifeScan several times about problems related to the two
defects but were not told about the defects. Some were hospitalized when
it was found through other means that their blood glucose was as high as
1,000 mg/dl.

Most were given new SureStep monitors.

In two cases, the agreement says LifeScan's director of clinical
evaluations a medical doctor - told management that a Medical Device
Report should be filed with the FDA and the meters immediate recalled
because they posed an unacceptable risk of harm.

                       Fine, Civil Penalties

Under the agreement, LifeScan will pay a criminal fine of $ 29.4 million
and civil penalties, damages, attorney fees and restitution to the United
States of $ 30.6 million.

The United States agreed not to file any other criminal charges against
LifeScan, Johnson & Johnson or their officers.

LifeScan was also placed on five years' probation, special conditions of
which were part of the plea.

                            Qui Tam Action

According to a settlement agreement attached as an agreement, a qui tam
action was filed in 1997 on behalf of the United States against LifeScan
by Robert Konrad, M.D., a board-certified clinical pathologist and former
director of clinical research at LifeScan, and John Pumphrey, a chemist
previously employed by LifeScan as director of reagent operations and
director of advanced reagent development (U.S.A., ex rel. Konrad, et al.
v. LifeScan Inc., et al., No. C 00-20478 JF, N.D. Calif., San Jose Div.).

The United States agreed to pay Konrad and Pumphrey $ 6,253,790 and their
counsel $ 250,000.

The government is represented by Acting U.S. Attorney David W. Shapiro
and Assistant U.S. Attorneys Jeffrey L. Bornstein and Anne-Christine
Massullo. John W. Keker of Keker & Van Nest in San Francisco represents
LifeScan and Johnson & Johnson.

In the qui tam action, the government is represented by Assistant
Attorney General David Ogden, U.S. Attorney Robert S. Mueller, U.S.
Senior Trial Counsel Daniel R. Anderson, Assistant Inspector General
Lewis Morris and Deputy General Counsel Robert L. Shepherd. Robert L.
Vogel in Washington, D.C., and Michael Rubin represent Konrad and
Pumphrey.

Jan Nielsen Little of Keker & Van Nest represented Johnson & Johnson in
the qui tam action. (Mealey's Emerging Drugs & Devices, January 4, 2001)


LINCOLN PARK: Students' Action against Searches Granted Class Status
--------------------------------------------------------------------
A federal judge on Tuesday granted class-action status to a lawsuit
originally filed by three Lincoln Park High School students who claimed
they were mistreated during mass searches at the school in 1999.

The decision by U.S. District Judge James F. Holderman could add more
students to the suit and increase the amount of any damages. The
students' lawyer, Gregory Kulis, said that potentially "hundreds of
students" were improperly searched at Lincoln Park High School on Nov.
16, 1999.

On that date, the lawsuit contends, police and school officials searched
them without cause when they entered the school. Kulis said some students
complained they were mistreated and fondled.

Chicago police and school officials have denied doing anything improperly
during the search for weapons and drugs at Lincoln Park. Police said
seven students were caught with box cutters and six with marijuana.
(Chicago Tribune, January 17, 2001)


MAD CRAB: Ohio Court Certifies Class of Food Poisoning Victims
--------------------------------------------------------------
The first class action suit claiming food poisoning in state history was
affirmed by an appeals court Sept. 28 over objections based in part on
the plaintiffs' lawyer's conduct (Sue Farrenholtz, etc. v. Mad Crab Inc.,
et al., No. 76456, Ohio App., 8th Dist.).

Defense counsel asked the appellate panel to review claims that the trial
court abused its discretion when it denied a motion to disqualify
plaintiffs' counsel for contacting members of the putative class before
it was certified. Also challenged was the trial court gag order on
defense counsel contacting members of the putative class before it was
certified.

The majority wrote, "The trial court need only engage in a brief analysis
of the claims to be litigated and the proof at trial when resolving the
predominance question" if common questions predominate individual
questions." (Mealey's Emerging Toxic Torts, January 5, 2001)


NEFF CORP.: Announces Shareholder Lawsuits Concerning URI Proposal
------------------------------------------------------------------
Neff Corp. (NYSE:NFF) announced that purported class action lawsuits were
filed relating to a merger proposal recently made to the Company by
United Rentals, Inc. (NYSE:URI) ("URI"). The actions filed in the
Delaware Court of Chancery in January 2001 by purported shareholders of
the Company name as defendants, the Company and its directors, URI,
General Electric Capital Corporation ("GECC") and Santos Fund I, L.P.

The complaints allege that directors Jorge, Juan Carlos and Jose Ramon
Mas (the "Mas Family"), GECC and Santos have acted in concert with
respect to the URI Merger Proposal to breach fiduciary duties allegedly
owed to the remaining stockholders of the Company. The complaints allege
that the terms of the URI Merger Proposal are unfair to other Company
stockholders. The complaints further allege that URI has aided and
abetted the alleged breaches of fiduciary duty by the Company's
directors, GECC and Santos. The complaints seek, among other things, to
enjoin the consummation of the URI Merger Proposal. The Company believes
that the complaints are without merit.

In the event a definitive merger agreement is entered into in connection
with the URI Merger Proposal, URI expects to file a registration
statement on Form S-4, and the Company expects to file a proxy statement
with the Securities and Exchange Commission ("SEC"). It is anticipated
that the Company and URI would mail a joint proxy statement/prospectus to
Company stockholders containing additional information about the proposed
transaction.

Investors and security holders are urged to read the registration
statement and joint proxy statement/prospectus carefully if and when they
become available and any other relevant documents filed with the sec
because they contain important information. These documents will contain
important information about the proposed transaction and the interests of
the Company and its directors Jorge Mas, Juan Carlos Mas, Jose Ramon Mas,
Paul E. Dean, Arthur B. Laffer, Joel-Tomas Citron and Michael Markbreiter
in the proposed transaction.


PHILIPS INTERNATIONAL: Amended Complaint Re Liquidation Filed in MD
-------------------------------------------------------------------
On January 9, 2001, an amended class action complaint was filed in the
United States District Court for the Southern District of New York
against Philips International Realty Corp., a Maryland corporation, and
its directors. The Amended Complaint alleges a number of improprieties
concerning the plan of liquidation of the Company. The Company believes
that the asserted claims are without merit, and will defend such action
vigorously.

The Amended Complaint amends the initial class action complaint (the
"Original Complaint") filed in the United States District Court for the
Southern District of New York against the Company and its directors on
October 2, 2000. The day after the Original Complaint was filed, the
plaintiff served the Company with an order to show cause why a
preliminary injunction should not be issued enjoining the vote on the
Company's then proposed plan of liquidation. At a conference with the
Court on October 5, 2000, the parties stipulated that the vote on the
Company's proposed charter amendment and the plan of liquidation would
proceed as scheduled.

On November 9, 2000, the Court, ruling from the bench, denied the
plaintiff's motion for a preliminary injunction. On November 30, 2000,
the Court issued its written opinion, and the judgment was entered
denying the plaintiff's motion for a preliminary injunction on December
1, 2000.

A copy of the amended complaint is available in the company’s SEC file at
http://www.sec.gov/Archives/edgar/data/1050686/0001125282-01-000110.txt


PRI AUTOMATION: Schiffrin & Barroway Files Securities Suit in MA
----------------------------------------------------------------
The following statement was issued on January 16 by the law firm of
Schiffrin & Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in the
United States District Court for the District of Massachusetts on behalf
of all purchasers of the common stock of PRI Automation, Inc. (Nasdaq:
PRIA) from January 27, 2000 through September 11, 2000, inclusive (the
"Class Period").

Contact: Marc A. Topaz, Esq. or Robert B. Weiser, Esq., both of Schiffrin
& Barroway, LLP, 888-299-7706, 610-667-7706, or info@sbclasslaw.com


SEMPRA, EL PASO: Documents and Notes Led to Energy Collusion Suits
------------------------------------------------------------------
Documents turned over to an attorney during an earlier lawsuit are what
led a team of attorneys to file two class-action suits against San
Diego-based Sempra Energy and Houston-based El Paso Energy last month.

The handwritten notes and typed meeting agenda allegedly reveal a
"conspiracy" to keep energy prices artificially high, according to the
attorneys who filed the suit Dec. 19 in Los Angeles County Superior
Court.

A team of lawyers from Los Angles and elsewhere named Sempra and El Paso
Energy, and some of their subsidiaries as defendants in the suit. The
action is seeking to recoup billions of dollars the attorneys say has
been siphoned out of California due to what they call collusion by the
energy companies to divide up the state and keep competition at bay.

The suits allege the two energy giants conspired to drive up natural gas
costs 1,700 percent this year, in turn helping to push electricity costs
to record levels. Most electric generation plants in California are
powered by natural gas.

All "non-core" users of natural gas from Sempra or El Paso can become
parties to the class-action lawsuit, as are all California users of
electricity not currently under the rate freeze originally implemented in
1996 -- that is, customers of San Diego Gas & Electric Co.

The two class-action lawsuits, filed by eight lawyers from three firms in
Los Angeles, one from Hermosa Beach and one from Denver, alleged that El
Paso Energy, with the collusion of Sempra officials, conspired to limit
natural gas supplies.

                         No Mincing Words

The lawsuits do not mince words: In the preliminary statement
accompanying the two lawsuits, the words conspire, conspiracy and
conspirators appear a total of 14 times in 3 1/2 pages of text.

Lance Astrella, attorney from the Denver-based law firm of Astrella &
Rice, P.C., alleges that on Sept. 25, 1996, high-ranking officials from
El Paso Energy held a secret meeting in Phoenix with high-ranking
officials from SDG&E and Southern California Gas Co.

At that secret meeting, utility officials allegedly discussed strategies
to rig the natural gas market, Astrella said.

The meeting was revealed through testimony and documents uncovered during
the discovery phase of an earlier case filed in Houston, Astrella said.

According to Astrella, the utilities discussed the actions of one of
their former competitors, Tenneco Inc. In 1992, Tenneco had completed the
Kern River Pipeline, which brings natural gas from Wyoming to
Bakersfield.

Before the secret meeting in September 1996, Tenneco had been looking to
expand that pipeline northward into Canada, and southward to Southern
California and Baja California. The company was also looking to build
another pipeline to Southern California and Baja from Arizona, Astrella
said.

Had either of these pipelines been completed, gas customers -- including
generators of electricity -- would have seen not only lower gas prices
but also a more stable supply, he said.

But this never happened. El Paso acquired Tenneco in June 1996, Astrella
said.

                         Projects Withdrawn

"This placed EPNG in charge of Tenneco's proposed by pass projects, and
SoCal Gas and SDG&E saw the opportunity to make a deal with EPNG to
eliminate them .... Top officers of EPNG agreed that EPNG would withdraw
Tenneco's Southern California and Baja California bypass projects," the
complaints state.

That helped assure SoCal Gas' continued dominance of the market. At about
the same time, the parent companies of SoCal Gas and SDG&E merged,
forming Sempra Energy, Astrella said.

Officers from the two merging companies knew that El Paso could bring the
whole arrangement down by raising objections to the merger, citing
potential anti-trust violations. So the companies formed a "gentleman's
agreement," under which SoCal Gas would withdraw from competition against
El Paso in yet another area, he said.

Both SoCal Gas and El Paso were looking to build a lucrative pipeline to
Samalayuca, Mexico. Due to an earlier arrangement, these were the only
two companies vying for the contract, Astrella said.

SoCal had a large cost advantage over El Paso, but withdrew from the
project, he said.

                   California Split Into 'Teams'

Other deals also came out of the September 1996 meeting. Minutes obtained
from the meeting allegedly show that attendees had sought to carve up
California, keeping control over Southern California as "Team 1," while
ceding control of the northern half of the state to Pacific Gas &
Electric and natural gas providers throughout the Northwest as "Team 2,"
Astrella said.

The plan took a few years to implement, but once all the elements were in
place, customers got squeezed, Astrella said. El Paso bought up power
plants in Southern California, and used those plants to purchase natural
gas at artificially high prices. That caused the prices of electricity to
jump, which was ultimately passed along to the power customer, he
alleged.

Also, as El Paso was buying up the capacity on its own pipeline, that led
to an artificial shortage in the state. In the past four years, the price
of natural gas increased from roughly $ 2 per thousand cubic feet to $ 9
at its source, but jumped from $ 3 to $ 60 once it crossed the border
into California, Astrella said.

"So they basically pocketed the very high profits on the gas, measured by
the difference between the purchase price and the California border
price, and then passed along the additional electric generation costs to
the consumers," he said.

This amounts to a restraint of trade and a monopoly, both violations of
the Cartwright Act, and of the unfair competition and unlawful business
practices provision of the California Business and Professional Code,
said Albro Lundy III, who is joining the lawsuit with Astrella as an
attorney representing Hermosa Beach-based Baker, Burton & Lundy.

This lawsuit follows on the heels of similar accusations against El Paso
from the California Public Utilities Commission. Harvey Morris, public
utilities council for the CPUC, filed a complaint with the Federal Energy
Regulatory Commission alleging that El Paso gave its affiliates
preferential treatment in hoarding the amount of space in its pipeline,
artificially driving up the price for other buyers at the Southern
California border.

The original complaint was filed in April, along with a request that the
FERC void the contracts El Paso entered into with its own affiliates. In
August, the CPUC applied to the FERC for summary disposition of the
complaint, which is still pending, Morris said.

What makes the current lawsuits different from the move by the CPUC is
that California regulators are looking only to stop El Paso and Sempra
from what they're doing right now. The two class-action lawsuits seek to
recoup billions of dollars in what they call illegal profits, returning
the money to San Diego ratepayers, said Brad Baker, also from the law
firm of Baker, Burton & Lundy.

The two Dec. 19 lawsuits came on the heels of two earlier class-action
lawsuits filed Nov. 28 and 29. Those suits, against Duke Energy, Dynegy,
Inc., Enron, PG&E, Sempra and others, alleged collusion and market
manipulation among electricity producers and energy marketers trading in
California.

The earlier lawsuits have no specific examples of market manipulation,
however. The new lawsuit makes specific accusations, and has already
assembled a paper trail, Lundy said.

Doug Kline, spokesman for Sempra, denied the allegations in the two most
recent lawsuits.

"Any allegations that the company or its subsidiaries violated antitrust
or other laws are completely false," he said. "On Dec. 7, SDG&E filed for
emergency relief from the Federal Energy Regulatory Commission asking
federal regulators to impose a price cap on natural gas transportation
prices to the California border that, if approved, would lower costs for
California gas customers." (San Diego Business Journal, January 1, 2001)


SIMON TRANSPORTATION: Utah District Ct Dismisses Securities Lawsuit
-------------------------------------------------------------------
The Company and certain of its officers and directors have been named as
defendants in a securities class action filed in the United States
District Court for the District of Utah, Caprin v. Simon Transportation
Services, Inc., et al., No. 2:98CV 863K (filed December 3, 1998). As
previously reported in the CAR, plaintiffs in this action allege that
defendants made material misrepresentations and omissions during the
period February 13, 1997 through April 2, 1998 in violation of Sections
11, 12(2) and 15 of the Securities Act of 1933 and Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder.

                                 Update

On September 27, 2000, the District Court dismissed the case with
prejudice. Plaintiffs have asked the Court for reconsideration and
alteration or amendment of the decision.


TERAYON COMMUNICATION: Consolidated Securities Complaints Filed in CA
---------------------------------------------------------------------
On April 13, 2000, a lawsuit against Terayon Communication Systems and
certain of its officers and directors, entitled Birnbaum v. Terayon Comm.
Systems, Inc., was filed in the United States District Court for the
Central District of California.

As previously reported in the CAR, the plaintiff purports to be suing on
behalf of a class of stockholders who purchased or committed to purchase
our securities during the period from February 2, 2000 to April 11, 2000.
The complaint alleges that the defendants violated the federal securities
laws by issuing materially false and misleading statements and failing to
disclose material information regarding our technology. Several other
lawsuits similar to the Birnbaum suit have since been filed. The lawsuits
seek an unspecified amount of damages, in addition to other forms of
relief.

                                 Update

On August 24, 2000, the lawsuits against the company and other named
individual defendants were consolidated in the U.S. District Court of the
Northern District of California and lead plaintiffs and plaintiffs'
counsel was appointed pursuant to the private securities litigation
Reform Act.

On September 21, 2000, plaintiffs filed a Consolidated Class Action
Complaint for violation of federal securities laws. The consolidated
complaint contains allegations nearly identical to the Birnbaum suit.

Defendants filed a motion to dismiss the consolidated complaint on
October 30, 2000, and plaintiffs filed an opposition. Defendants filed a
reply in support of their motion to dismiss on December 22, 2000. The
hearing on this motion was scheduled for January 8, 2001.


VERIZON: Cohen Milstein Files Securities Suit in District of Columbia
---------------------------------------------------------------------
Cohen Milstein Hausfeld & Toll, P.L.L.C., on January 16 filed a class
action lawsuit against Verizon Communications, Inc. and Verizon Internet
Services, Inc. in the Superior Court of the District of Columbia on
behalf of all purchasers of the Verizon Online and Verizon DSL Access
Service.

The complaint alleges that Verizon Internet Services, Inc. promised to
provide ultra high-speed Internet access through digital subscriber lines
("DSL"). Verizon guaranteed the availability of this service, with the
exception of regularly scheduled maintenance. Verizon customers, however,
have not had uninterrupted access to the Internet. To the contrary,
Verizon customers have experienced significant access disruptions and
significant delays in obtaining technical service. The complaint alleges
that Verizon and was aware that it would be unable to provide DSL service
as promised and knew that its customers would experience significant
disruptions and significant delays in obtaining technical support.

Verizon aggressively markets its high-speed DSL access service, signing
up more than 3,000 new customers per day. However, many of these
customers have experienced serious disruptions in their Internet service
or significant delays in obtaining technical service. Indeed, Cohen
Milstein partner Gary E. Mason stated, "These problems are so severe that
entire websites are dedicated to airing grievances about Verizon DSL."
Further, Mason noted, "Verizon is acutely aware of these service
interruptions and service delays, yet has failed to disclose these
problems to current and potential customers." As a result, Mason added,
"This class action is aimed at not only compensating Verizon customers
for poor service, but also at preventing Verizon from continuing to sell
DSL internet access until these problems are resolved."

Contact: Cohen Milstein Hausfeld & Toll, PLLC Gary E. Mason, 202/408-4600
Alexander E. Barnett, 202/408-4600uits filed against 14 contractors that
operated the government's nuclear weapons and research complex in Oak
Ridge since World War II, lawyers said.


WEAPONS CONTRACTORS: Lawsuits Claim Radiation Effects, Discrimination
---------------------------------------------------------------------
Untold damages, medical monitoring and "a public apology" are being
sought in two class-action lawsuits. "One (lawsuit) deals with the health
hazards that were created and have never been properly addressed,"
Nashville lawyer George Barrett said in a telephone interview. "The other
deals with the deliberate creation of a racially segregated community
which has been preserved up to this time in violation of the Constitution
and the laws of Tennessee." The lawsuits were filed Wednesday in U.S.
District Court in Knoxville.

The lawsuits apparently will rely heavily on the results of an
eight-year, $ 14 million health study released last January suggesting
that some Oak Ridge residents may have suffered thyroid cancer or brain
damage because of toxic releases, particularly from the 1940s to early
1960s.

The health study, prepared by the state and underwritten by the
Department of Energy, estimated that perhaps less than 100 people
developed these diseases. "The ultimate question that we tried to answer
can perhaps be summarized by this: Was anybody hurt?" study chairman Paul
Voilleque said at the time. "Our answer today is, probably."

The eight plaintiffs include former employees, residents and their
children.

Now Barrett is suing virtually every corporation that managed the DOE-Oak
Ridge facilities since their creation in 1944 as part of the top-secret
Manhattan Project to build the first atomic bomb. The facilities are: the
Y-12 nuclear weapons plant, the Oak Ridge National Laboratory and the
former K-25 uranium enrichment plant. Listed as defendants are: Union
Carbide Corp., Monsanto Co., Eastman Kodak Co., Eastman Chemical Co., the
University of Chicago, Roane-Anderson Co., Turner Construction Co.,
Martin-Marietta Energy Systems Inc., Lockheed Martin, Lockheed Martin
Energy Systems, Babcock & Wilcox Co., McDermott International Inc. and
Bechtel Inc. Also named are present ORNL manager Battelle Inc. and Y-12
manager BWX Technologies. Company spokesmen could not be reached for
comment Tuesday night.The lawsuits claim hazardous, toxic and radioactive
releases from the Oak Ridge plants damaged or threatened the health of
residents and their children living in Oak Ridge or downwind or
downstream of the plants. The lawsuits seek "a public apology for
deliberately irradiating the public and exposing them to deadly
radioactive and hazardous materials without their consent," a press
release said.

In addition, one of the lawsuits claims blacks who relocated to Oak Ridge
for work in the 1950s were moved into the Scarboro community, where they
were exposed to high levels of pollutants from the Y-12 plant about a
mile away. The neighborhood remains predominantly black.

In 1999, the U.S. Centers for Disease Control said it could not
substantiate claims of a higher incidence of asthma among Scarboro
children. The CDC said that 13 percent of 119 Scarboro children had
respiratory problems - about double the national average but similar to
children living in inner-city Detroit.

Last year, Energy Secretary Bill Richardson acknowledged that the
government exposed bomb factory workers to health hazards, and Congress
approved a compensation program. But DOE is not a defendant in the
Barrett lawsuits.

In 1998, Barrett won a $10 million settlement against Vanderbilt
University in Nashville and others for 1940s experiments in which
pregnant women unknowingly ingested radioactive iron. (The Associated
Press State & Local Wire, January 17, 2001)


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