CAR_Public/010319.MBX               C L A S S   A C T I O N   R E P O R T E R

               Monday, March 17, 2001, Vol. 3, No. 54

                             Headlines

AIMCO: Dyer & Shuman Files CO Suit over Payment to Security Holders
CCA-TREATED WOOD: Miami Lawsuit Calls Preservative a Health Hazard
COCA-COLA: Ex-labor Secretary to Monitor $192.5M Settlement of Bias Suit
ELBIT LTD: Announces the Certification of Suit in Tel-Aviv Re Warrants
ELBIT: Announces the Certification of Lawsuit in Tel-Aviv Re Warrants

HOLOCAUST VICTIMS: German Industry Isolated in Refusal to Free up Fund
HOLOCAUST VICTIMS: Lawyers Urge Judge for Expedited Dismissal of Case
HOLOCAUST VICTIMS: Plaintiffs Ask Judge To Reconsider Tossing Out Suit
LIFE INSURERS: Annuity Sales Practices Under Scrutiny, IMSA Warns
NAPSTER INC: Misses Deadline to Block Popular Songs

NORTEL NETWORKS: Insiders Cashed In Before Warning; Staff Gained $16 Mil
PRE-PAID LEGAL: Confirms Inquiry By SEC Re 1999 Form 10-K
REPUBLIC SERVICES: FL Ct Dismisses Securities Suit Re Period in Jan 1999
SOTHEBY'S HOLDINGS: Announces Results & Progress on Antitrust Settlement
TACO BELL: to Pay $ 9 Mil to Settle Labor Lawsuit in Santa Clara, CA

TAINTED WATER: Top Judge To Preside In Walkerton E. Coli Settlement
TOBACCO LITIGATION: Judge Says 7th Amendment Doesn't Bar Severance

* In Germany, Shareholders Waste No Time in Launching Legal Challenges

                             *********

AIMCO: Dyer & Shuman Files CO Suit over Payment to Security Holders
-------------------------------------------------------------------
The following statement was issued March 15 by the law firm of Dyer &
Shuman, LLP.

Notice is hereby given that a class action lawsuit was filed in the United
States District Court for the District of Colorado on behalf of persons who
tendered and sold limited partnership units ("Units") in one of the
forty-five (45) limited partnerships set forth below, to Apartment
Investment Management Company ("AIMCO")(NYSE:AIV) and AIMCO Properties
L.P., between November 11, 1999, and December 30, 1999.

Angeles Income Properties, LTD II, Angeles Income Properties, LTD III,
Angeles Income Properties, LTD. 6, Angeles Opportunity Properties, LTD,
Angeles Partners VII, Angeles Properties, IX, Angeles Partners X, Angeles
Partners XI, Angeles Partners XII, Angeles Partners XIV, Century Properties
Fund XIV, Century Properties Fund XV, Century Properties Fund XVI, Century
Properties Fund XVII, Century Properties Fund XVIII, Century Properties
Fund XIX, Century Properties Growth Fund XXII, Consolidated Capital Growth
Fund, Cons. Capital Institutional Properties, Cons. Capital Institutional
Properties 2, Cons. Capital Institutional Properties 3, Consolidated
Capital Properties III, Consolidated Capital Properties, IV, Consolidated
Capital Properties V, Consolidated Capital Properties VI, Davidson
Diversified Real Estate I, LP, Davidson Diversified Real Estate II, LP,
Davidson Diversified Real Estate III, LP, Davidson Income Real Estate, LP,
Davidson Growth Plus, LP, Fox Strategic Housing Income Partners, HCW
Pension RE Fund LTD Partnership, Johnstown/Consolidated Income Partners,
Multi-Benefit Realty Fund '87-1, National Property Investors 3, National
Property Investors 4, National Property Investors 5, National Property
Investors 6, National Property Investors 7, National Property Investors 8,
Shelter Properties I, LTD., Shelter Properties II LTD Partnership, Shelter
Properties III LTD Partnership, Shelter Properties IV LTD Partnership,
Shelter Properties V LTD Partnership, Shelter Properties VI LTD Partnership
and Shelter Properties VII LTD Partnership.

The complaint alleges that defendants violated Sections 14(e) and 20 of the
Securities Exchange Act of 1934, by failing to pay the consideration
offered or return the securities deposited by or on behalf of security
holders promptly after the termination or withdrawal of a tender offer. The
complaint further alleges that the calculation of fairness of the prices
offered in the tender offer documents were materially false and misleading
and omitted to state material facts as set forth above.

Contact: Dyer & Shuman, LLP John M. Martin, Esq., 303/861-3003 and
800/711-6483 Facsimile: 303/830-6920 JMartin@DyerShuman.com


CCA-TREATED WOOD: Miami Lawsuit Calls Preservative a Health Hazard
------------------------------------------------------------------
A widely used wood preservative, which helps keep children's playsets free
from termites and protects picnic tables from rotting, is a health hazard,
a lawsuit filed in Miami charges.

The suit, filed in U.S. District Court on behalf of Miami homeowner Jerry
Jacobs, who built a deck with CCA-treated wood, is the first to seek
class-action status to challenge the pesticide chromated copper arsenate,
or CCA, in the United States.

Among other things, the suit seeks unspecified monetary damages, medical
monitoring for people who came into contact with the treated wood, and
independent testing of soil on sites where the products are used by
children.

Exposure to CCA treated wood can result in arsenic poisoning, which in the
short term can trigger muscle spasms and vertigo and in the long run can
cause severe gastritis, gastrointestinal problems and cancer of various
types, the lawsuit says.

According to the suit, CCA contains the chemical elements chromium, copper
and arsenic that can enter the body by skin absorption, breathing,
penetration of the skin or ingestion, which critics say makes children
particularly susceptible to potential poisoning.

Mel Pine, a spokesman for an industry group, the American Wood Preservers
Institute in Fairfax, Va., said he had not yet seen the suit and couldn't
comment on specifics. But he said concerns over the safety of CCA-treated
wood are unfounded.

"If you played outside on pressure-treated swingset probably you'd have as
likely a chance of getting skin cancer from sun exposure as you would from
the arsenic," he said. "When our product is looked at from a scientific
standpoint, it's absolutely safe."

Lawyers are seeking class-action status, which could open the case to
people across the country who have bought the treated lumber or come into
contact with objects made of the wood. "Defendants have conducted and
engaged in a full-scale marketing and public relations campaign involving
and consisting of a course of misrepresentation, omission and half-truths
to assuage the public and conceal the true dangers, harmful effects and
toxicity of treated wood," the suit says. Some of the biggest manufacturers
of the CCA formula and lumber companies are named in the suit, along with
major retailers Home Depot and Lowe's Home Centers.

Lumberyards and home-supply stores sell the green-tinted wood under the
brand names Wolmanized pressure-treated wood and Osmose K-33, as well as
green lumber, salt-treated lumber and pressure-treated lumber.

Switzerland, Vietnam and Indonesia have banned CCA-treated wood, and other
countries have restricted its use.

In the United States, the Environmental Protection Agency has studied the
product but has not restricted its use. The wood preservers group agreed to
prepare an EPA-approved flier with consumer instructions on how to handle
CCA-treated wood and a list of possible health hazards.

But the industry officials admit that the materials don't always reach
consumers. "Our industry has done the best it can to distribute the EPA
approved consumer information sheets," Pine said.

Retailers contend they should not be held accountable for a product that
the federal government says is safe. "The only thing we do is sell it,"
said Marsha Ferguson, a spokeswoman for Home Depot, the Atlanta-based
retail chain. "We depend on regulatory agencies such as the EPA to tell us
what products are safe and what products are unsafe."

Products made with CCA-treated lumber are popular in Florida, where
termites and humidity are especially a factor. CCA-treated wood costs about
15 percent less than alternative products, according to the wood preservers
group. There is no dispute that CCA works against bugs and humidity. But
there is a dispute over how safe it is.

The suit cites a study by the University of Florida Center for Solid and
Hazardous Waste Management. The study examined 65 soil samples taken from
below treated decks. The tests showed that CCA-treated wood leaches enough
arsenic to "routinely fail the U.S. EPA's toxicity levels." "It does leach
out during its service life," said Elena Solo-Gabriele, a University of
Miami professor and one of the study's authors. She said 10 to 20 percent
of the CCA will leach out of the wood after 20 years, depending on how much
was used initially.

"From the wood industry point of view, wood treaters see this as, wow, 80
percent is still in it after 20 years because the chemical is still there
fighting off fungi," she said. "But from the environmental point of view,
20 percent is significant amount. It can impact the environment."

The chemical gained attention in Florida, after The St. Petersburg Times
published the results of an independent study showing that CCA-treated wood
at five Tampa Bay area playgrounds showed arsenic leaching at levels higher
than the state considers safe.

Gov. Jeb Bush said he wants the state's wood-treatment plan in Raiford to
stop using arsenic to treat wood used for park boardwalks, highway
guardrails and other outdoor structures. And city officials in Tarpon
Springs closed a playground and the cities of Crystal River and New Port
Richey said they would test community playgrounds for arsenic leaching.

City officials at Miami Beach started taking precautions after learning of
the questions surrounding the preservative a few years ago. The city's
property division no longer buys CCA-treated woods for certain projects,
said Bruce Lamberto, who works for Miami Beach's property management
division. "We still use pressure-treated lumber, however, we don't use it
for playgrounds or where children could come in contact. City benches are
made of steel. Trash cans are made of steel," Lamberto said. "We are aware
of it (the controversy) and making sure that we don't use any of it around
any of the playgrounds." (The Miami Herald, March 16, 2001)


COCA-COLA: Ex-labor Secretary to Monitor $192.5M Settlement of Bias Suit
------------------------------------------------------------------------
Twenty-eight years ago, Alexis Herman was on a mission to get corporate
jobs for black professional women in the South. Working for the Southern
Regional Council in Atlanta, Herman scored one of her first victories by
landing a job for a young chemist at Coke.

Last Thursday March 15, the former U.S. labor secretary said she has come
"full circle" in her new role as head of the independent task force created
to monitor Coca-Cola's $192.5 million settlement of a class-action racial
discrimination lawsuit filed by employees. "That chemist job was a
breakthrough, and I think this settlement was a breakthrough," Herman said
in an interview. "I took the job because I really think it's a historic
opportunity for the company and our country."

Herman, 53, who served in the Clinton and Carter administrations, was
jointly selected by Coke and the plaintiffs to head the outside,
seven-member task force. The panel is a key ingredient of the settlement
affecting 2,000 current and former African-American employees at Coke.

"It sends a signal that Coke is very serious about getting it right," said
Sharon Hall, an Atlanta-based diversity expert at executive search firm
Spencer Stuart. "There are two ways to staff such task forces. One way is
to get a diverse collection of 'yes' men and women. The other way is the
right way, which is to get a collection of diverse people who bring
experience, thought, leadership and passion. Alexis Herman represents the
latter."

U.S. Rep. John Lewis (D-Ga.), who has known Herman for 25 years, seconded
that notion. "She'll do a super job, not just for Coca-Cola, but for the
whole idea of diversity in the workplace," Lewis said. "Not just in theory,
but in helping to make it real."

The agreement settling the suit and creating the task force still must be
approved by U.S. District Judge Richard Story in Atlanta.

Workers have until March 19 to decide whether to accept the monetary part
of the agreement or "opt out" to pursue their own claims. As of last
Thursday March 15, fewer than 1 percent had given the settlement a thumbs
down.

The task force will be responsible for reviewing company practices on pay,
promotions and performance evaluations --- the three key issues in the
lawsuit --- as well as for recommending changes to improve diversity. And
the panel will have enforcement powers. "Coca-Cola will implement the task
force recommendations unless the company seeks and obtains judicial
relief," the agreement says. To obtain such relief, the company would have
to prove that following a task force recommendation would constitute
unsound business judgment or would be unfeasible technically or
financially.

The other six members of the task force --- three selected by the company
and three selected by the plaintiffs --- have not been announced.

Compensation for the members has not been disclosed. But the racial
discrimination settlement is patterned after a similar one at Texaco, where
the head of the task force has been paid $125,000 a year, while other
members have received $75,000 each.

Herman said the task force will need to get support from everyone in the
company. "I think the biggest challenge is probably the need to communicate
and have it realized that when you work on these kind of issues ... that
the whole organization benefits," she said. "That you're not just talking
the talk but walking the walk." She said she wasn't concerned about
backlash from employees who will not be sharing in the settlement. "If we
have effective communication, I'm not worried."

Herman's appointment came as class members wrestle with the details of the
settlement, which provides an estimated average of $40,000 per class
member. Nearly 200 of the 2,000 class members are asking Story to give them
more time to decide whether to accept it or opt out.

Legal experts, however, said the judge is not likely to respond favorably
to the petition. Already, he has denied one formal motion requesting more
time other than the two months provided. In his ruling on that motion,
Story said the decision-making process not only meets "the requirements of
due process, but it exceeds those requirements."

Also, some class members have complained that the process is taking too
long before the settlement money is distributed. A fairness hearing on the
settlement is currently scheduled for May 29. No money can be awarded until
the judge decides whether to OK the deal following the hearing.

Former Coke human resources manager Larry Jones, who led a boycott against
the company to try to pressure it into equitably settling the suit, said he
is not planning to opt out. "At some point, you have to say that we have
achieved a certain degree of progress and you move forward to achieve other
progress in different ways," Jones said.

Jones also is pleased with Herman's selection. "I think it's a very
positive move," he said. "I can't see anything but good things happening
out of that." Jones said Herman should draw a wide circle and talk to as
many current and former Coke workers as possible.

Herman, who grew up in Mobile, was steeped in the civil rights movement,
largely because of her father, Alex Herman, who was the state's first
African-American ward leader. She became labor secretary in 1997, but only
after a long and difficult confirmation fight. She was the first
African-American to hold the job.

It was her work getting professional jobs for black women in the South that
first brought her to the attention of former President Carter. She was
chosen to serve as director of the Women's Bureau of the Labor Department,
making her, at age 29, its youngest director ever. Her role was to oversee
women's issues in both the public and private sectors.

Nearly two decades later, when Clinton was first elected, she served as
director of the Office of Public Liaison during his first administration
before becoming labor secretary. In the latter role, Herman was a hands-on
administrator who wasn't afraid to get her hands dirty --- literally. She
donned a hard hat and went down into the mine shafts to see firsthand the
conditions of coal miners.

Herman graduated from Xavier University in New Orleans and did graduate
work at the University of South Alabama. (The Atlanta Journal and
Constitution, March 16, 2001)

On an annual basis, the Task Force will issue written reports to the CEO,
the Board of Directors, the Court and class counsel; and the Chairperson
will make in-person reports to an appropriate committee of the Board of
Directors and the CEO. The annual reports, which will be made available to
the public on the Company's web site, will include:

   -- A review and evaluation of the Company's U.S. employment and human
resources policies and practices;

   -- A description of reforms implemented due to the settlement agreement;

   -- An assessment of the Company's compliance with the settlement
agreement.

Each year, as part of its reporting function, the Task Force will continue
to review and evaluate all ongoing employment policies and practices at the
Company, monitor the impact and effectiveness of modifications of such
policies and practices, and suggest additional changes necessary to achieve
the objectives of the settlement agreement.


ELBIT LTD: Announces the Certification of Suit in Tel-Aviv Re Warrants
----------------------------------------------------------------------
Elbit Ltd. (Nasdaq: ELBTF) announced that on March 14, 2001, the Company
obtained the decision of the Tel-Aviv district court certifying as a class
action, the claim served against the Company, Elbit Medical Imaging Ltd.
(Nasdaq: EMITF), Elron Electronic Industries Ltd. (Nasdaq: ELRNF) and Mr.
Emmanuel Gill, dated March 2, 1999.

The claim was filed on behalf of those persons who sold warrants (series 2)
of the Company between August 1 and August 31, 1998, excluding the
Defendants and directors of the companies being sued.

The plaintiffs' main allegations are that the Defendants withheld
information regarding negotiations allegedly conducted by Elscint Limited
(NYSE: ELT), a subsidiary of Elbit Medical Imaging Ltd., for the sale of
Elscint Limited's main lines of business to third parties. The information
was subsequently published, following the execution of term sheets for such
sale, after the warrants had expired.

The relief requested by the plaintiffs is at least NIS 105,612 for the
plaintiffs and an aggregate of NIS 6,571,696 for the members of the class,
as compensation for the alleged damage caused to the class, plus legal
expenses of at least 15% of the amount to be ruled upon by the court.

The Company is currently reviewing the district court's decision with its
legal counsel in order to file an appeal against the decision.

                        About Elbit Limited

Elbit develops value-added services for tomorrow's e-business market.
Company growth is based on strategic investments, mergers and acquisitions.
Elbit develops e-business solutions by incubating technology start-ups,
providing them with comprehensive management and strategic marketing
capabilities. The following are several of its key investments: Contop
specializes in wireless remote monitoring and control applications based on
its proprietary messaging technology. Cellenium develops, markets and
operates m-commerce patent-pending technologies and solutions, enabling all
cellular subscribers to securely use their existing handsets for everyday
payments. Dealigence is developing patent-pending technology for corporate
commerce sites and electronic marketplaces that will allow traders to
better match and negotiate their transactions by taking into account a
large number of parameters and by preference matching. ICC provides
outsourced procurement management and logistics services over Internet and
Intranet communications networks, based on a unique system developed and
integrated by ICC. |starkey|NET is developing a complete solution to enable
a person to operate computerized software applications in the new
e-business era using natural language, personal customized assistants
personified in real-time 3D animated characters and dialogue generating
software. Textology utilizes technology that will enable organizations to
manage diverse unstructured information. Its products will provide an
integrated platform for automatic text categorization, natural language
search and data retrieval and high-quality personalization. In addition,
Elbit has a shareholding (12.3%) in Partner, the first cellular operator in
Israel using GSM technology.


ELBIT: Announces the Certification of Lawsuit in Tel-Aviv Re Warrants
---------------------------------------------------------------------
Elron Electronic Industries Ltd. (NASDAQ:ELRNF) a leading multinational
high technology holding company, announced that on March 14, 2001 the
Company obtained the decision of the Tel-Aviv district court certifying the
claim served against the Company, Elbit Medical Imaging Ltd., Elbit Ltd.
and Mr. Emmanuel Gill, dated March 2, 1999, as a class action.

The claim was filed on behalf of those persons who sold warrants (series 2)
of Elbit Ltd. between August 1 and August 31, 1998, excluding the
defendants and directors of the Companies being sued.

The plaintiffs' main allegations are that the defendants withheld
information regarding negotiations allegedly conducted by Elscint Limited
(a subsidiary of Elbit Medical Imaging Ltd.) for the sale of Elscint
Limited's main lines of business to third parties. The information was
subsequently published, following the execution of term sheets for such
sale, after the warrants had expired.

The relief requested by the plaintiffs is at least NIS 105,612
(approximately $26,000) for the plaintiffs and an aggregate of NIS
6,571,696 (approximately $ 1.6 million) for the members of the class, as
compensation for the alleged damage caused to the class, plus legal
expenses of at least 15% of the amount to be ruled upon by the court.

The Company is currently reviewing the district court's decision with its
legal counsel in order to file an appeal against the decision.

Elron Electronic Industries Ltd. is a multinational high technology holding
company based in Israel. Through affiliates, Elron is engaged with a group
of high technology operating companies in the fields of advanced defense
electronics, communication, software, information technology and
semiconductors.


HOLOCAUST VICTIMS: German Industry Isolated in Refusal to Free up Fund
----------------------------------------------------------------------
German industry found itself increasingly isolated in its stubborn refusal
to free up half of a 10 billion mark (dlrs 4.8 billion) compensation fund
for Nazi-era slave laborers unless it gets airtight protection from U.S.
lawsuits.

German politicians, commentators and Jewish leaders tried to break the
monolithic position by insisting that the firms are demanding a level of
security that simply doesn't exist.

Hans-Jochen Vogel, head of a German group helping Holocaust survivors, said
he respects German firms' economic concerns in the face of open-ended
litigation, but that speedy payouts mattered more since aging survivors are
dying daily. ''I can only say again: Stop these arguments. Help the
people,'' he said on Deutschlandfunk radio.

Among the cases German industry wants quashed is a dlrs 400 million claim
by a Holocaust survivor in Los Angeles against construction company
Hochtief and a class-action suit against IBM in New York alleging that
punch-card machines from the company's German subsidiary helped the Nazis
organize the Holocaust in the 1940s.

In contrast to German companies, the government has long ago reached legal
closure on Holocaust claims. Under compensation laws n the 1950s and '60s,
with long-expired deadlines, West Germany paid more than 100 billion marks
(dlrs 46 billion) in restitution to Holocaust victims after World War II.

But slave labor was excluded from the restitution laws because the German
government argued it was up to companies to pay. German firms agreed to
consider payments in 1999 only under pressure from U.S. class-action suits
and German Chancellor Gerhard Schroeder's new government agreed to
contribute half of the total fund in a show of moral support despite the
insistence by previous governments that Germany had paid its share.

Industry dragged its feet for months on coming up with its full half of the
fund, gathering the money in an urgent phone and letter campaign only after
a U.S. Judge Shirley Wohl Kram refused to dismiss a class-action suit
against German banks because of the shortfall.

While the government has paid its half of the money to the fund, the
industry portion has not yet been turned over.

Debate about the nation's moral responsibility sharpened after Schroeder
and industry leaders reaffirmed that compensation would be blocked until at
least the bulk of U.S. class-action suits on behalf of survivors are thrown
out.

''German industry regards compensation not as a matter of the heart but as
a little collateral problem of history,'' the Berliner Zeitung newspaper
wrote.

Other critics suggested that industry could hamstring compensation
indefinitely. ''By demanding absolute legal security, it is showing
absolute unwillingness to pay,'' wrote Sueddeutsche Zeitung, an influential
national newspaper.

A spokesman for companies paying into the fund rejected that notion, saying
German industry's aim is to have enough of the pending suits rejected to
set precedents against future legal action.

''We're not talking about absolute legal security,'' spokesman Wolfgang
Gibowski said, adding that government and industry would now look at which
of the roughly 17 cases U.S. are the most important to have dismissed.
''That's not a matter of years,'' he said.

But the leader of Germany's Jewish community urged the companies to break
the impasse and advance some money to the fund immediately. ''Anyone who
has a burden of guilt must make a concession up front,'' Paul Spiegel told
the newspaper B.Z.

Compensation for an estimated 1 million now-elderly workers who were forced
to keep Nazi factories and farms running during World War II is supposed to
flow under a July accord between German companies who employed slave labor,
U.S. class-action lawyers and the governments of Germany, the United
States, Israel and East European countries. Most of those eligible are
non-Jewish citizens of former communist countries.

But meeting German industry demands for ''legal security'' has proven
elusive. The U.S. government has agreed to make statements in favor of
legal closure in American courts but, as Vogel pointed out, ''it can't
forbid lawsuits.''

Germany's parliament must certify ''adequate legal security'' for the
companies before payments can begin. Holocaust survivor groups urged
lawmakers to take that step immediately - even before all of the suits have
been thrown out and increase pressure on industry.

Otherwise the compensation payments of up to 15,000 marks (dlrs 7,000) will
turn into ''funeral money,'' one activist, Christoph Jetter, said in
Berlin. (AP Worldstream, March 15, 2001)


HOLOCAUST VICTIMS: Lawyers Urge Judge for Expedited Dismissal of Case
---------------------------------------------------------------------
Lawyers for Nazi-era slave and forced laborers will urge U.S. Judge Shirley
Kram to dismiss a case against German banks in order to remove a legal
block to the compensation payments from Germany. "We're making an
application to the judge tomorrow to reconsider and grant a dismissal on a
expedited basis," said attorney for the plaintiffs Ed Fagan. "After the
judge dismisses, the German parliament passes a bill that says we have now
achieved legal peace. That triggers the release of the money." Kram refused
to block a class-action suit brought against German banks, saying that
because German industry had at that point failed to contribute its share,
the victims could not be sure they would be paid. German Chancellor Gerhard
Schroeder said that no compensation would be paid out until U.S. lawsuits
against German firms which contributed were formally closed. (AFX European
Focus, March 15, 2001)


HOLOCAUST VICTIMS: Plaintiffs Ask Judge To Reconsider Tossing Out Suit
----------------------------------------------------------------------
Plaintiffs in litigation against German banks have asked a federal judge to
reconsider her refusal to dismiss a class-action lawsuit standing in the
way of compensation to more than one million former slave laborers. The
request was made in legal papers filed in U.S. District Court in Manhattan,
where Judge Shirley Wohl Kram is presiding over a series of
Holocaust-related lawsuits stemming from World War II.

The plaintiffs say payouts from a settlement setting up a dlrs 4.6 billion
fund to compensate people enslaved by the Nazis during World War II have
been delayed until the litigation is dismissed.

Kram on March 7 refused to toss out the lawsuits because a German
foundation set up to distribute the money had not yet been funded and
because the claims of victims not yet represented by lawyers were
jeopardized by the deal.

In a five-page court filing, the plaintiffs maintained that actions taken
by German industry guarantee full funding of the German foundation and that
there were adequate provisions in the settlement to treat fairly those
victims not yet represented.

''We stand on the threshold of either achieving success for the victims or
failure in the pursuit of perfection. The world is watching,'' the
plaintiffs said in the court papers. ''We beseech the court to reconsider
its March 7 opinion, dismiss the complaints against German banks and let
well intentioned people implement the compact which will benefit over 1
million people, many in the twilight of their lives.''

The money is to be funded in equal parts by German industry and the German
government.

More than one million former laborers worldwide, most of them central and
eastern Europeans, are expected to be eligible for payments. The fund also
will compensate people subjected to Nazi medical experiments and some with
other Holocaust-related claims.

Robert Swift, a Philadelphia lawyer who filed the motion, said the funding
decision by German industry erased Kram's major complaint. ''She has now
prodded them into action and can thus declare success,'' he said. He noted
that newspapers and the German government largely praised Kram's earlier
ruling. ''We're very anxious to begin the distribution process and
dismissal of cases is essential,'' he added. (AP Worldstream, March 16,
2001)


LIFE INSURERS: Annuity Sales Practices Under Scrutiny, IMSA Warns
-----------------------------------------------------------------
Some leading carriers could soon face disciplinary actions for alleged
improper marketing and sale of variable annuities, said the head of the
life industry's market-conduct organization.

Paul J. Mason, executive director of the Insurance Marketplace Standards
Association, said during a meeting with analysts at A.M. Best Co. that six
enforcement actions filed in February by the regulatory arm of the National
Association of Securities Dealers were "just the beginning." "We were
informed that that would be minor in comparison with the cases they would
bring against major companies," Mason said. But the "biggest blow" could
yet come from the Securities and Exchange Commission, which is pursuing its
own investigations involving sales of variable annuities, he said. "The SEC
has done a number of investigations primarily on bonus annuities," Mason
said. "They are being fairly circumspect in terms of what the timing is,
but it appears more likely than not that they will be bringing some major
cases-- most likely in suitability and supervision."

The bonus annuity, a recent development in annuity writing, offers buyers a
bonus payment, at time of purchase, of from 1% to 5% of the premium. Under
bonus annuities, insurers charge higher annual fees and longer surrender
periods.

In February, NASD Regulation filed six enforcement actions for the improper
marketing and sale of variable annuities. Five defendants settled charges
without admitting or denying the allegations and agreed to pay fines.

The other, American United Life Insurance Co., Indianapolis, was still
working with the NASD to resolve its case (BestWire, Feb. 20, 2001). These
disciplinary actions were the first resulting from a series of special
examinations focusing on sales of variable contracts conducted by NASD
Regulation during 1999 and Monetary sanctions in the five settled cases
totaled more than $112,000, including restitution. All five parties that
settled were censured and agreed to pay fines. Prudential Securities Inc.
was fined $10,000, First Union Brokerage Services Inc., $32,500; Allmerica
Investments Inc., $15,000; and Lutheran Brotherhood Securities Corp,.
$25,000. Ralph Evans, a broker, was fined $10,000 and ordered to pay
restitution to the affected customer of $20,131.

The cases involved the alleged use of misleading and unbalanced advertising
and sales literature. This material allegedly failed to adequately disclose
that variable contracts purchased in tax-deferred plans provide no
additional benefit to the customer. The cases also involved use of a Web
site that implied the tax benefits in tax-deferred plans are only available
if they are funded with an annuity contract.

Also involved were sales of variable annuities in ways that didn't suit the
financial situation of customers, failure to collect customer information
for determining suitability, and deficient supervisory procedures with
respect to suitability reviews. "This is sending out a very strong
message," Mason said of the actions by NSDA Regulation. The NASD is the
largest securities industry self-regulatory organization in the United
States. Since variable life insurance and variable annuity contracts are
securities, their distribution is subject to NASD rules.

From 1996-1999, sales in variable annuities mushroomed from $74.3 billion
to $122.6 billion, according to the Variable Annuity Research and Data
Service, Roswell, Ga. Last year, the organization said it expected
variable-annuity sales in 2000 to top $150 billion. A variable annuity is
an annuity product that allows the owner to invest in independently managed
subaccounts. In recent years, insurers' distribution systems have undergone
major changes, a trend that contributes to market-conduct concerns, Mason
said.

A survey by Kenneth Kehrer Associates, an independent consulting firm in
Princeton, N.J., found that sales of annuities through banks reached $32.7
billion last year, a 20% increase over 1999 and an all-time record for such
bank sales. While the study shows that captive agencies still accounted for
34%, or the bulk of sales of life insurance and annuities in 2000, the
remainder was distributed among banks and credit unions, independent firms
and regional investment firms.

"We're talking about billions of dollars of sales that are taking place now
through distribution channels that have, in-house, much less familiarity
with the nature of those products, at the same time that those products are
becoming more complex," Mason said. "The change in a short time frame--if
you look at the history of this industry--is so dramatic that I'm not sure
that those issues that go with that change in distribution systems still
have been adequately enough treated by the regulators," he said. "I'm not
even sure that in every company there is yet a level of appreciation and
sensitivity that when a product is developed, the supervision and training
is consonant with responsibilities to the public." Mason said it comes down
to the "equality of treatment of the public." Consumers who are interested
in purchasing a variable annuity today, whether from a career agent, an
independent agent, a bank or a brokerage firm, may not receive the same
level of information from each source to help them determine if the product
is right for them, Mason said, "No matter where you are in the distribution
system, there should be no advantages or disadvantages in terms of sales,"
he said.

The biggest challenge IMSA now faces is persuading the life industry to
develop market-conduct policies and procedures that apply to every
component in a company's distribution system, Mason said.

IMSA has asked the National Association of Insurance Commissioners to
consider it a safe harbor in market conduct activities by state regulators.
The standards organization has argued that its member-companies should not
be subject to the same level of scrutiny as nonmembers because members have
already demonstrated their compliance with ethical market-conduct
procedures.

But the NAIC has countered that no precedence exists to name a private
organization within NAIC model laws and regulations. The NAIC Suitability
Working Group is expected to consider the issue at the association's
national quarterly meeting beginning March 24 in Nashville, Tenn.

IMSA's creation in 1996 was the life industry's response to highly
publicized class-action lawsuits alleging unethical sales practices by some
of the biggest and most recognizable companies in the industry, including
Prudential Insurance Company of America, Metropolitan Life Insurance Co.
and New York Life Insurance Co. Many of the problems concerned agents who
encouraged clients to replace long-standing policies with newer "vanishing
premium" policies, whose dividends were supposed to cover the premiums
after a given amount of time. But some agents, who received high
commissions for the new sales, didn't adequately represent the risk that if
interest rates dropped--and they did--the policies wouldn't perform as
expected and the premiums would not vanish.

Initially, IMSA's program focused on individual life insurance and
annuities. IMSA added long-term-care products to the lineup for 2001. The
program covers agent appointments and training; fair, honest and clear
marketing material; supervision of a company's policies and procedures; and
expeditious handling of customer complaints. IMSA counted 244 life
companies as members in This represented 80% of overall market share, Mason
said. As of mid-March, membership renewals totaled 228, or 79% of market
share, a reduction largely due to mergers and acquisitions within the
industry, consolidations of units within companies, or company failures.
"At least two-thirds of that remaining group are no longer in business,"
Mason said. (BestWire, March 16, 2001)


NAPSTER INC: Misses Deadline to Block Popular Songs
---------------------------------------------------
A deadline for Napster Inc. to block 135,000 songs came and went, yet fans
of the popular online music-sharing service still found a wide selection of
the most popular tunes to download free.

The Redwood City company is operating under a preliminary injunction issued
by U.S. District Judge Marilyn Hall Patel to prevent the swapping of
copyright-protected songs.

The biggest record labels gave Napster a list of 135,000 popular songs and
artists they wanted blocked. As of last Monday March 12, the company said
it had already blocked at least 115,000 song files, including ones from
previous lists. But the company was still scrambling to filter seemingly
infinite versions of the same songs that appear with misspelled or
misidentified file names on Napster members' directories.

The terms of the injunction gave Napster three business days, or the end of
the day March 14, to comply. Napster officials said they were working as
fast as they could to filter the songs. In fact, access to Napster was shut
off for almost an hour around 5 p.m. as the company added new data to its
song-screening system.

However, Napster Chief Executive Officer Hank Barry has complained that
Napster's effort to screen the songs was complicated because a large
portion of the listed songs did not include all of the information required
by Patel's order.

"We're not commenting on what they have or have not done," said Amy Weiss,
senior vice president of communications for the Recording Industry
Association of America.

Napster is augmenting its own song-filtering software with technology from
Berkeley's Gracenote, known for its CDDB Music Recognition Service that can
identify songs and titles on a music CD. The CDDB program taps into a
database that already has compiled 3 million variations of 9 million
artists and songs.

Meanwhile, Napster on March 14 filed motions in U.S. District Court in San
Francisco asking Patel to deny class-action status in two related civil
suits.

One suit, filed by Casanova Records on behalf of independent label owners
and artists, seeks statutory damages for copyright infringement and an
injunction to stop song-sharing on the Napster system without prior
permission by the plaintiffs.

The other suit was filed by Jerry Leiber, Mike Stoller and Frank Music
Corp. on behalf of music publishers represented by the Harry Fox Agency,
which provides licensing and royalty collection services for nearly 30,000
music publishers and more than 2.5 million copyright protected works.

In opposing class certification in the Casanova case, Napster cited a
recent story in The Chronicle that found independent musicians divided over
Napster. One songwriter quoted in the article, Matthew Montfort, is the
plaintiffs' proposed class representative in the suit.

Montfort's concession that songwriters are divided, repeated in a
deposition a few days after the article, shows that the goals of the
lawsuit are "fundamentally at odds with the goals and interests of a
substantial percentage of the proposed class who value Napster as an
effective alternative to traditional methods of promoting and distributing
music," Napster lawyers wrote.

Similarly, in the Leiber case, Napster said the proposed injunction and
damages "would thwart the aims and harm the interests of a significant
percentage of the class." E-mail Benny Evangelista at
bevangelista@sfchronicle.com and Bob Egelko at begelko@sfchronicle.com.
(The San Francisco Chronicle, March 15, 2001)


NORTEL NETWORKS: Insiders Cashed In Before Warning; Staff Gained $16 Mil
------------------------------------------------------------------------The
weeks before Nortel Networks Corp. abruptly cut a rosy profit forecast in
half on Feb. 15 saw more than a dozen senior employees cash in stock
options worth more than $16 million, documents show.

Insider trading reports released by the Ontario Securities Commission
detail numerous transactions in January and early February - several times
more than was typical of Nortel staff in the preceding months.

"Just because they exercised the options isn't proof they knew about the
earnings guidance, but it sure looks bad," Lawrence Surtees, senior
telecommunications analyst at IDC Canada Ltd., said.

Nortel's share price plunged 33 per cent, or $15.15, to $31 the day after
the profit warning - prompting numerous class-action lawsuits by investors
who lost millions and say the company should have issued an earlier warning
about its changing fortunes.

By March 14, Brampton-based Nortel had fallen another $1.60 to $23.90 on
the Toronto Stock Exchange, down from a peak of $124 last summer.

One Nortel executive, 18-year veteran Peter Aronstam, was busy making
trades on Feb. 2, Groundhog Day. He exercised 119,332 options granted to
him under Nortel's compensation plan in five separate transactions. The
share prices ranged from $5.62 to $15.53 (U.S.) per share. He sold them all
for $37.22 each, making a gross profit of $3.34 million.

Three days later, Aronstam exercised another 14,000 options at $5.96 and,
again within hours, sold them all for $37.22. His take on this transaction
was $437,626, raising the gross tally for the two trading days to $3.78
million.

Company insiders, a category that includes senior executives or anyone else
presumed to have access to inside information, are legally required to
report all stock trades to regulators.

Nortel president John Roth, however, was not among the sellers this year.
He purchased 26,000 shares on Feb. 5 for $53.65 (Canadian) each. Not that
he was hurting for money, anyway. Roth earned $1.1 million (U.S.) in salary
last year, another $5.6 million in bonus, plus $135.2 million (Canadian)
from exercising stock options, according to Nortel's proxy circular sent to
shareholders in advance of the company's April 26 annual meeting in
Calgary.

Surtees noted that Roth was a leading lobbyist in Ottawa last year for more
favourable tax treatment of stock options as a way of stemming the
high-tech brain drain to the United States In addition, Roth was given a
healthy raise last August 1 to a base salary of $1.25 million (U.S.), up
from the $1 million he had been earning. "The 2000 salary, bonus and stock
option awards for Mr. Roth reflect his outstanding contribution to Nortel
Networks Corporation's 2000 record financial results," the circular said.
According to the management proxy circular, Roth owned 3,570,934 shares of
Nortel as of Feb. 28. He was also granted 750,000 options at an exercise
price of $118.68 (Canadian). They do not expire until July 26, 2010. (The
Toronto Star, March 15, 2001)


PRE-PAID LEGAL: Confirms Inquiry By SEC Re 1999 Form 10-K
---------------------------------------------------------
Pre-Paid Legal Services, Inc. (NYSE: PPD), confirmed as reported in March
16's Wall Street Journal that the Company has responded to a confidential
informal inquiry by the Ft. Worth Office of the Division of Enforcement of
the Securities and Exchange Commission ("SEC") and has responded to
confidential comments made by the SEC's Division of Corporation Finance
regarding the Company's 1999 Form 10-K.

Randy Harp, Chief Operating Officer commented, "As we expected when the
recent class actions were filed, we have received inquiries from both the
Division of Enforcement and the Division of Corporation Finance of the SEC
requesting information relating to our accounting policies for commission
advances to sales associates. These are informal inquiries and do not
constitute a formal investigation or proceeding. We are cooperating with
the staff of the SEC and providing the requested information and expect to
continue to do so. We are not able to predict what the outcome of these
inquiries may be or when they will be resolved, but we are requesting the
SEC to attempt to resolve them as expeditiously as possible."

                   About Pre-Paid Legal Services

Pre-Paid Legal Services develops and markets legal service plans across
North America. The plans provide for legal service benefits, including
unlimited attorney consultation, will preparation, traffic violation
defense, automobile-related criminal charges defense, letter writing,
document preparation and review and a general trial defense benefit.


REPUBLIC SERVICES: FL Ct Dismisses Securities Suit Re Period in Jan 1999
------------------------------------------------------------------------
In September 1999, several lawsuits were filed by certain shareholders
against Republic Services Inc. and certain of the company’s officers and
directors in the United States District Court for the Southern District of
Florida.

The plaintiffs in these lawsuits claim, on behalf of a purported class of
purchasers of our common stock between January 28, 1999 and August 28,
1999, that the defendants violated Sections 10(b) and 20(a) of the
Securities Exchange Act of l934 by, among other things, allegedly making
materially false and misleading statements regarding our growth and the
assets we acquired from Waste Management.

In December 1999, the Court consolidated these lawsuits and the
consolidated action has been named In Re: Republic Services, Inc.
Securities Litigation. The plaintiffs filed a consolidated complaint in
February 2000 and the defendants filed a motion to dismiss the consolidated
complaint in April 2000.

In February 2001, the Court granted the defendants' motion to dismiss the
consolidated complaint. In that order, the Court granted plaintiffs leave
to file an amended complaint by March 7, 2001.


SOTHEBY'S HOLDINGS: Announces Results & Progress on Antitrust Settlement
------------------------------------------------------------------------
Sotheby's Holdings, Inc. (NYSE: BID; LSE), the parent company of Sotheby's
worldwide live and online auction businesses, art-related financial
services and real estate activities, has announced results for the full
year ended December 31, 2000. For 2000 the Company reported total revenues
of $ 397.8 million, compared to $ 442.6 million for the previous year. Net
loss for 2000 was $ 189.7 million, or ($ 3.22) per diluted share, compared
to net income of $ 32.9 million, or $ 0.56 per diluted share for 1999.
Results for the year ended December 31, 2000 were impacted by pre-tax
special charges of $ 203.1 million, or ($ 2.71) per diluted share, related
to the Department of Justice antitrust investigation and related matters,
and pre-tax restructuring charges of $ 12.6 million, or ($ 0.14) per
diluted share, recorded in the fourth quarter of 2000. Excluding special
charges and restructuring charges, the Company reported a diluted loss per
share of ($ 0.37) for 2000.

Total auction sales in North America decreased 17% to $ 1,043.2 million,
principally due to lack of single-owner sales. In Europe, auction sales
decreased 13% to $ 786.0 million. Excluding the unfavorable impact of
foreign currency translations, auction sales in Europe decreased 5%. This
decrease was primarily due to the rescheduling of the Impressionist Art and
Contemporary Art sales in the United Kingdom from December of 2000 to
February of 2001. Asian auction sales increased 19% to $ 107.1 million, due
primarily to a single-owner sale during the fourth quarter of 2000, as well
as stronger sale results in :he Chinese Ceramics and Works of Art sale.
"While 2000 was an extremely difficult year for Sotheby's, our Company
nevertheless accomplished some notable successes," said Bill Ruprecht,
President and Chief Executive Officer of Sotheby's, Holdings, Inc. "We
achieved strong sales of $ 1,936.3 million, despite the scarcity of
single-owner collections and an increasingly competitive business
environment; as well as the establishment of SOTHEBYS.COM as the unrivaled
online marketplace for authenticated and guaranteed fine and decorative art
in our first year as an online auctioneer. Most importantly, Sotheby's
continues to have the best art and art market expertise in the world and
all of our key employees remain committed to this Company."

                        Special Charges

Pre-tax special charges of $ 203.1 million recorded during 2000 principally
consist of the settlements of the antitrust class action related to
auctions in the United States and the shareholder class action, as well as
a fine related to the plea agreement with the Department of Justice. The
settlement of the shareholders class action and the Company's plea and fine
were approved by Federal courts in February, and the settlement of the
antitrust class action was conditionally approved. The Company has made a
submission to the court addressing the conditions in the court's order
relating to the antitrust class action, and the court has requested
interested parties to submit any responses to this proposal by March 22,
2001.

The settlement of the antitrust class action provides for a payment to the
class by Sotheby's of $ 256 million, including certificates that may be
used as a credit against future vendors' commissions and other vendors'
charges with a face value of $ 62.5 million and a fair market value of not
less than $ 50 million. A. Alfred Taubman has agreed to fund $ 156 million
of the settlement. During the fourth quarter of 2000, Sotheby's deposited $
100 million toward the antitrust class action settlement in escrow for the
benefit of the class, of which $ 50 million was funded by Mr. Taubman. The
vendors' commission certificates will expire five years after the date they
are distributed to the class, and any unused certificates may be redeemed
for cash at face value at the end of four years.

Pursuant to the terms of the shareholder class action settlement, during
the fourth quarter of 2000 Sotheby's deposited $ 30 million in escrow for
the benefit of the class. Mr. Taubman funded the entire amount of this
payment. Additionally, as part of the shareholder class action settlement,
the Company expects to issue to the class $ 40 million in Sotheby's Class A
Common Stock during the first half of 2001.

Sotheby's net cash outlay as a result of these settlements is currently
expected to be $ 50 million.

The Company also pled guilty to a violation of the U.S. antitrust laws
relating to auction commissions charged to sellers at auction and has
agreed to pay a fine of $ 45 million without interest over a period of five
years. Included in special charges for 2000 is a pre-tax charge of $ 34.1
million, representing the present value of this fine.

                      Restructuring Charges

"Management initiated a strategic and operational review of the Company's
businesses in August 2000," said Mr. Ruprecht. "The goal of this review was
two fold -- the identification of key collecting areas, both high-end and
middle markets, where greater profitability could be achieved; and the
streamlining of cost-heavy operations. Sotheby's will place greater focus
and resources on high-end markets worldwide such as Impressionist, Modern,
and Contemporary Art. Additionally, a second salesroom will be opened at
Olympia in West London. This salesroom, which will open in the second half
of 2000, will expand our presence in key middle markets, and ultimately
strengthen our position in the United Kingdom."

Mr. Ruprecht continued, "The second initiative -- reduction of cost heavy
operations -- will encompass the consolidation of certain departmental
resources and sales -- particularly the lower-end markets, which
consistently deliver a lower scale of profitability. Our recently expanded
York Avenue headquarters, which will allow for the consolidation of five
New York offices, including SOTHEBYS.COM, will also play a role in cost
savings."

The restructuring plan resulting from this review was approved by the
Company's Board of Directors in December 2000 and resulted in pre-tax
restructuring charges of $ 12.6 million recorded in the fourth quarter of
2000. The restructuring plan is estimated to save approximately $ 15 - 20
million in our live auction business and an additional $ 25 million in our
online auction business. The estimated live auction savings will be
partially offset by incremental costs of approximately $ 7.0 million
associated with the new Olympia middle market salesroom in West London. The
savings will be initiated this year and are currently expected to be fully
realized by 2002. The Company also intends to increase spending on various
strategic initiatives that further the goals of the Restructuring Plan,
which will offset a portion of the total savings.

                             Internet

"Since launching SOTHEBYS.COM one year ago, we have built the largest
online auction marketplace for fine and decorative arts, collectibles, and
jewelry," said Mr. Ruprecht. "The combining of our two websites --
SOTHEBYS.COM and sothebys.amazon.com -- in November 2000, allowed us to
achieve greater scale in terms of bidding activity and property offered,
all the while offering the highest level of client service and security."

"While the June 2000 sale of the Declaration of Independence for $ 8.14
million stands as our most impressive online event to date, SOTHEBYS.COM
achieved strong prices for items across all categories. We sold 255 lots
for more than $ 10,000 during 2000 and the average value of a lot sold on
SOTHEBYS.COM was $ 1,700. On any given day, we have some 10,000 - 15,000
items available for bidding across more than 300 categories -- representing
the largest site of its kind for authenticated and guaranteed property. We
believe these results indicate the potential that exists to develop a
thriving online marketplace for the sale of fine art, antiques and
collectibles.

"In its first year, SOTHEBYS.COM had $ 52.9 million in online auction
sales. While sales levels and revenues did not meet with our initial
expectations, we have been pleased with the increasing level of auction
sales quarter over quarter, as well as increasing dealer participation."

Excluding any Internet related restructuring charges, Internet related
expenses for 2000 were $ 56.0 million, driven by heavy first quarter
marketing costs associated with the launch of SOTHEBYS.COM and
sothebys.amazon.com. Excluding any Internet related restructuring charges,
the impact of the Internet related operating loss during 2000 was ($ 0.52)
per diluted share. Excluding any Internet related restructuring charges,
Internet related expenses for the fourth quarter of 2000 were $ 12.1
million. The impact of the Internet related operating loss for the fourth
quarter, excluding any Internet related restructuring charges, was ($ 0.11)
per diluted share.

                          2001 Sales

"Ahead are a number of important consignments for the spring auction
season," said Mr. Ruprecht. "In April our New York salesroom will auction
art and furnishings from the Collection of Gianni Versace, which is
estimated to bring between $ 5 - 7 million in auction sales. The Stanley
Seeger Collection of Modern and Contemporary Art is an exceptional
collection of 20th century Art by European and American artists, including
Francis Bacon, Pablo Picasso and Jasper Johns, and will be offered with an
estimate of $ 32 - 40 million.

Paintings and furniture from the Leverhulme Collection, one of the greatest
British Collections ever assembled, will be auctioned over the course of
three days in May on the premises at Thornton Manor and is estimated to
bring $ 7 - 10 million. In June, we will auction furniture, paintings, and
works of art from the attics at Althorp, Seat of the Earl Spencer. This
sale, which will also include the carriages from the family collection,
will take place at Althorp, Northhamptonshire.

"Among the highlights of our Impressionist and Modern Art Part I sale on
May 10th is Max Beckmann's Self-Portrait with Horn. This painting, the best
of Beckmann's self-portraits, is one of the greatest modern German
paintings left in private hands and is being offered at $ 7 - 10 million."

                    Winter 2001-Sales Summary

"We were very pleased with the results of our London series of
Impressionist & Modern and Contemporary Art sales, which were held in
February for the first time and brought a combined total of $ 63.2
million," continued Ruprecht. "Highlights from the Part I Impressionist &
Modern Art sale include Egon Schiele's Portrait of the Painter Anton
Peschka, and Claude Monet's Waterlillies, which brought $ 11.4 million and
$ 7.8 million, respectively. The sale totaled $ 38.5 million -- making it
the most successful winter sale in Europe for a decade. Part I of the
Contemporary Sale brought $ 12.2 million and set auction records for seven
artists. Among other successes held in the early part of 2001 was the
Magnificent Scientific Library of Joseph Freilich, which totaled $ 10.7
million, more than double its low estimate."

                 About Sotheby's Holdings, Inc.

Sotheby's Holdings, Inc. is the parent company of Sotheby's worldwide live
and Internet auction businesses, art-related financing and real estate
activities. The Company operates in 36 countries, with principal salesrooms
located in New York and London. The Company also regularly conducts
auctions in 12 other salesrooms around the world, including Australia, Hong
Kong, Italy, the Netherlands, Switzerland and Singapore. Sotheby's
Holdings, Inc. is listed on the New York Stock Exchange and the London
Stock Exchange.

Sotheby's Holdings, Inc.'s earnings conference call will take place on
Wednesday, March 14, 2001, at 4:45 PM EST. Domestic callers should dial:
800-218-4007 and international callers should dial: 302-262-2211. The call
reservation number is 300829.


TACO BELL: to Pay $ 9 Mil to Settle Labor Lawsuit in Santa Clara, CA
--------------------------------------------------------------------
Cutting short a trial in Santa Clara County Superior Court, Taco Bell has
agreed to pay $ 9 million to settle a class-action lawsuit alleging that it
cheated thousands of California employees out of overtime pay.

Lawyers still are hammering out the final details of the settlement
agreement, which was reached midway through a trial that began in early
February against the fast food chain. However, Superior Court Judge Jamie
Jacobs-May is expected to approve the agreement, which calls for Taco Bell
to pay the $ 9 million to as many as 3,000 current and former workers and
an undisclosed additional sum to plaintiffs' lawyers.

Taco Bell and lawyers for the workers agreed to the deal in late February,
after the plaintiffs had presented three weeks of testimony to a jury. The
lawsuit alleged that the Irvine-based chain systematically denied overtime
for store managers and assistant managers, and sought back pay and damages
for misconduct dating back to 1992. "It's less than we wanted and more than
they ever thought they were going to pay," said San Jose attorney Diane
Ritchie, one of the lawyers for the employees. "It's fair to say it was a
painful process for both sides." Taco Bell officials issued a brief
statement saying they were pleased the case is resolved, and defended the
company's labor policies as "fair and equitable."

The company, however, has been on the defensive in a number of courts
around the country for its overtime policies. Earlier this month, a jury in
Oregon sided with 1,300 former employees who sued Taco Bell over similar
allegations, setting up the possibility of a large award against the
company if it does not settle that case. Taco Bell settled an earlier case
in Washington for $ 2.8 million.

The trial against Taco Bell in Santa Clara County also came at a time when
more companies are facing litigation over their overtime policies. Over the
past few years, workers have filed class actions against Albertson's,
Wendy's, U-Haul International Inc., Pizza Hut and Mervyn's, among others.
Mervyn's paid $ 11.3 million to settle with its employees.

In the Taco Bell case, workers alleged that Taco Bell forced store managers
to handle many non-managerial chores to cut costs, but refused to
compensate them for frequent overtime. The suit also contended that
assistant store managers are regularly cheated out of overtime, and that
the company violates state labor laws by rigging its record-keeping
practices.

The class action covered employees at hundreds of Taco Bells around the
state, and several of the lead plaintiffs had worked at South Bay outlets.
When the case settled, 15 current and former employees already had
testified against the company. (San Jose Mercury News, March 15, 2001)


TAINTED WATER: Top Judge To Preside In Walkerton E. Coli Settlement
-------------------------------------------------------------------
Ontario's top trial judge will preside over the fairness hearing into the
settlement of Walkerton's class-action suit, launched after the water-borne
E.coli outbreak that devastated the town last May.

Chief Justice Patrick LeSage of the Superior Court of Justice will be in
Walkerton to hear comments from residents and the class-action lawyers on a
negotiated settlement that would see every resident get a minimum of
$2,000.

Michael Brown, the chief justice's executive legal officer, confirmed that
LeSage has decided to preside over the fairness hearing himself, instead of
Justice Warren Winkler.

Winkler announced Feb. 1 that a tentative deal had been reached in the suit
launched last fall. Under the terms of the settlement, those who believe
they should receive more than $2,000 because of pain and suffering or
economic losses will have their claims assessed individually.

There will be no cap on how much money a person can receive as compensation
and there are also provisions to reopen cases if health concerns arise in
the years to come.

Winkler had said he would oversee the compensation for those affected by
the contamination, but Brown said it has not been determined if the chief
justice will now take over that role. "All I can tell you is that Chief
Justice LeSage will be presiding over the hearing next week," Brown said.

The news that the chief justice is coming to town is a surprise to
Walkerton residents, said Bruce Davidson, spokesperson for Concerned
Walkerton Citizens. "This seems like an abrupt change of plan. We'd like to
know what Justice Winkler's role is now, but once again we've been left in
the dark," Davidson said. Winkler's office refused to comment on his future
involvement in the Walkerton settlement. (The Toronto Star, March 16, 2001)



TOBACCO LITIGATION: Judge Says 7th Amendment Doesn't Bar Severance
------------------------------------------------------------------
A New York federal trial judge on Feb. 8 held that the Seventh Amendment to
the U.S. Constitution does not circumscribe its authority in a tobacco
class action to sever issues for trial before different juries (Ellis
Simon, et al. v. Philip Morris Inc., et al., Nos. 00-CV-2340, 00-CV-4632,
00-CV-4442, 98-CV-1492, 99-CV-6142, 98-CV-3287, 97-CV-7658, 98-CV-0675 and
99-CV-7392, E.D. N.Y.).

In the Simon I class, the plaintiffs seek compensatory damages for cancer
due to its members smoking and punitive damages. The Simon II class
involves a broader class of people who may have been injured by tobacco and
includes those suing in Simon I.

In a Dec. 7 opinion, U.S. District Judge Jack B. Weinstein of the Eastern
District of New York noted that the application for certification in Simon
I was denied with a stay of the end of tolling of statutes of limitation.
The judge held that applying the rules of different states to determine
different issues in the same action is appropriate in this case.

Subsequently, the judge in a Feb. 8 opinion noted that an opt-out
compensatory class with subclasses is sought to be certified for trial
with: (a) some test cases tried in full before a single jury, and a general
fraud and related compensatory liability decided as to the rest of the
class by the same jury, (b) individual issues such as statute of
limitations and (c) a non-opt-out punitive damage class certified covering
all tobacco claims for punitive damages with the same jury that decided the
issues in determining punitive damages, if any. Before the judge were
severance issues for trial.

                         'Perverse Reading'

"It is contended that a trial judge's authority in a class action to sever
issues for trial before different juries is seriously circumscribed by the
Seventh Amendment to the United States Constitution. It would be strange if
that Amendment, described to restrict appellate power, were interpreted to
eviscerate that of the trail judge and jury to effectively adjudicate
complex cases," the judge said. "There is no basis for a such perverse
reading of the Constitution."

The judge added that the historical role of the trial court vis-a-vis the
jury supports the proposition that procedural devices that permit the trial
court, rather than the appellate court, to exercise control over jury
verdicts are not limited by the Seventh Amendment.

"The language and spirit of the Federal Rules of Civil Procedure together
with the history of the Seventh Amendment and subsequent case law
demonstrate that the Reexamination Clause should not be read as a mandate
to constitutionalize civil procedure in order to frustrate the class action
mechanism - a device created to foster 'judicial economy and efficiency by
adjudicating, the extent possible, issues that affect many similarly
situated persons,'" the judge said. (Mealey's Emerging Drugs & Devices,
March 1, 2001)


* In Germany, Shareholders Waste No Time in Launching Legal Challenges
----------------------------------------------------------------------
Germany's equity culture may be just five years old, but shareholders have
wasted no time in launching legal challenges that could help raise the
standards of corporate governance in Europe's largest economy.

In the past few months, a number of high technology outlets listed on the
Neuer Markt, Frankfurt's market for growth stocks, have come under the
scrutiny of lawyers for practices ranging from the release of misleading
information to outright fraud.

Responding to shareholder complaints, public prosecutors in several cities
have opened criminal investigations into the managers of several businesses
while other companies are facing civil suits in Germany and the US.

The avalanche of legal cases is not limited to new economy upstarts. The
Bonn public prosecutor opened a criminal investigation into Ron Sommer,
Deutsche Telekom's chief executive, and other board members surrounding the
alleged overvaluationof the group's property assets. That same day,
prosecutors in Dusseldorf launched an investigation into Klaus Esser,
former chief executive of Mannesmann, after a Stuttgart law firm unearthed
documents suggesting he might have yielded to a hostile takeover by
Vodafone of the UK in exchange for a large redundancy payment.

The attacks on some of the country's most highly regarded businessmen have
sparked equally robust counter-accusations.

Chancellor Gerhard Schroder entered the fray two weeks ago by rejecting
calls for Mr Sommer's resignation and warning investors that share prices
could go down as well as up. "Some people are finding it hard to understand
the level of risk that comes with equity investment," says Ekkehardt
Wenger, professor of banking and finance at Wurzburg University and one of
the first shareholder activists to question Deutsche Telekom's valuation of
its property assets. "But managers must (also) learn that, in today's
economy, you cannot gain from misinforming shareholders."

German companies have faced the wrath of international investors before for
the casual way in which they release information, an attitude inherited
from the era when most of the country's corporations were tied to each
other by complex cross-shareholding.

Deutsche Telekom is facing a lawsuit in the US for failing to announce a
bid for Voicestream, a US rival, ahead of its secondary share offering last
June. DaimlerChrysler, which also has securities listed in the US, is being
sued by investors there for presenting its takeover of Chrysler as a merger
of equals.

For German lawyers, however, the outdated corporate culture is not alone to
blame. German law itself makes it difficult for investors to obtain
compensation in cases of fraud or negligence. Klaus Rotter, a Munich-based
lawyer representing minority shareholders in civil cases against several
Neuer Markt companies, says: "In the US, negligence by managers is enough
for shareholders to obtain damage. In Germany, you need to establish the
management intended to commit fraud."

Another hurdle is the impossibility of bundling large numbers of complaints
into US-style class-action suits, allowing legal costs to be spread among
the plaintiffs. Many lawyers also criticise the lack of access to internal
company documents, except in the case of criminal investigations.

The absence of legal provision for class-action lawsuits has also led some
companies, such as Berlin-based Foris, which is itself listed on the Neuer
Markt, to open funds for the financing of compensation suits in exchange
for a share of damage payments.

The government, under the aegis of the Justice Ministry, has now set up a
commission to explore possible improvements to the laws governing
shareholder protection. Yet few lawyers expect dramatic changes to the
legislation, relying instead on public pressure to change attitudes among
managers. (Financial Times (London), March 16, 2001)


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Copyright 1999.  All rights reserved.  ISSN 1525-2272.

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