CAR_Public/010502.mbx               C L A S S   A C T I O N   R E P O R T E R

                Wednesday, May 2, 2001, Vol. 3, No. 86

                             Headlines

ARNEL MANAGEMENT: Ambassador Nominee with Cloud of Lawsuits By Tenants
BINDVIEW DEVELOPMENT: Shareholders File Letter re Director with SEC
BRIGHTPOINT, INC: Court Grants Motion to Dismiss Securities Litigation
CENDANT CORP: Can Sue Accountants Over Shareholder Payments
CHICAGO: Enjoined From May 1 Increase for Retiree Healthcare Premiums

CISCO SYSTEMS: Scott + Scott Expands Period in Shareholder Lawsuit in CA
DOLLAR GENERAL: Cauley Geller Announces Securities Lawsuit in TN
DOLLAR GENERAL: Charles J. Piven Announces Securities Lawsuit
DOLLAR GENERAL: Milberg Weiss Files Securities Suit in Tennessee
DOLLAR GENERAL: Wechsler Harwood Files Securities Suit in TN

DRUG PRICE-FIXING: Judge Grants Prelim. Approval Of $100 Mil Settlement
DYNAMEX INC: Gets Prelim Approval for Securities Suit Settlement in TX
F.B.I.: Judge Approves Settlement in Bias Lawsuit Filed By Black Agents
FEN-PHEN: Judge Rejects Privilege For 9,500 AHP Documents
FEN-PHEN: New Book and Court Finalization of Settlement Revive Interest
HOLOCAUST VICTIMS: Generali Fund to Distribute Compensation
HOOTERS RESTAURANT: Appeals $11.9 Mil Judgment For Sending Junk Faxes

INMATES LITIGATION: Rights Advocates Accuse CA of Ignoring Needs re AIDS
INVESTMENT FIRMS: Accused of Collusion and Fraud in IPO Manipulation
TRW INC: Agrees To Pay Higher Lump-Sum Payments To Retirees
U.S. AGGREGATES: Milberg Weiss Files Securities Suit in CA

                            *********

ARNEL MANAGEMENT: Ambassador Nominee with Cloud of Lawsuits By Tenants
----------------------------------------------------------------------
One of Orange County's most powerful figures in politics and business has
been nominated as ambassador to Spain, but he is already facing some
rocky relations with some unhappy tenants in his own empire of apartment
buildings. As the confirmation process unfolds, it's important that as
much light be shed as possible on this prolonged dispute.

Tenants claim that George Argyros' Arnel Management Co. cheated them out
of security deposits, and the case has become such a hornet's nest that
Dist. Atty. Tony Rackauckas turned it over to state Atty. Gen. Bill
Lockyer. That's as it should be, and with consideration of the Argyros
nomination by the Senate Foreign Relations Committee to be scheduled
soon, and to be followed up by a Senate confirmation vote, a speedy
investigation of the case by the attorney general is important.

The local district attorney's role became controversial because he was
perceived by critics in his own office as having too much of a personal
interest. Argyros was a key supporter and campaign contributor to Dist.
Atty. Rackauckas.

Prosecutors had concluded that potentially thousands of tenants could be
due refunds, and Rackauckas irritated some of his own people when he
called them off a civil lawsuit against Arnel and instead ordered
negotiations. He argued that he did this only to get tenants refunds
quickly, but his office's discussions with Arnel failed to produce a
settlement. The state attorney general's office probably was the proper
place for this case all along. In the past, it has been involved in
tenant-refund cases and in assessing civil penalties where appropriate.

In addition to a class-action lawsuit that tenants filed charging Arnel
with withholding security deposits for unnecessary cleanups and repairs,
they also have accused the firm of discriminating against tenants with
ethnic surnames.

This case involves an appointment to a country whose language is spoken
by many tenants in the apartment buildings of Southern California. The
case ought to get a thorough evaluation both by the state attorney
general and by the U.S. Senate. It's a matter of what's right and
honorable. If Argyros' company has mistreated tenants, he ought to be
held accountable. If his company has done nothing wrong, then Argyros'
name should be cleared. But the question ought not to be left hanging for
the man who would be the next U.S. ambassador to Spain. (Los Angeles
Times, May 1, 2001)


BINDVIEW DEVELOPMENT: Shareholders File Letter re Director with SEC
-------------------------------------------------------------------
Below is a letter filed in the company's Form SC 13D/A Report to the SEC:

April 10, 2001

Sent via facsimile and U.S. Postal Service

Board of Directors
BindView Development Corporation
5151 San Felipe, 25th floor
Houston, TX   77056

Gentlemen:

We are in receipt of a letter dated March 27 from Richard Gardner, Chief
Executive Officer of BindView Development Corp. in response to our
letters of March 22 and 23 (copies attached). We were extremely
disappointed by the lack of any substantive response to our
correspondence.

We are sorry that Mr. Gardner perceived our professional criticism as
personal and inflammatory, as our letters were meant to be neither. We
simply sought - and continue to seek - to raise certain matters of grave
concern to us regarding the management and direction of BindView. As
shareholders of BindView, we feel it is not only appropriate but
necessary that we share these concerns with you. Of course, it is
impossible to separate the actions (or inaction) of corporate management
from the individuals comprising that group, which is fully responsible
for its own missteps. While Mr. Gardner may not like having his conduct
scrutinized or criticized, he signed on to manage a public company, and
accordingly is subject to the public scrutiny and evaluation attendant
with that privilege.

Furthermore, Mr. Gardner himself must accept responsibility for the
public's awareness of our criticism and any possible embarrassment that
resulted. Had he shown us the courtesy of taking Mr. Loeb's call instead
of making the accusation of deceit (by claiming that Mr. Loeb was not a
BindView shareholder), our publicly available correspondence would have
never existed, much less been part of the public record (as required by
S.E.C. Rule 13d). Third Point Management and Chapman Capital have made
hundreds of investments in publicly traded companies, though we have been
forced only on rare occasions to expose our views publicly. (Incidentally
it has come to our attention that Mr. Gardner has denied to a reporter
that he hung up on Mr. Loeb. Once again, Mr. Gardner is the one making a
"false statement" as Mr. Chapman was witness to Mr. Gardner's unilateral
disconnection). In addition, it has come to our attention that Mr.
Gardner and Mr. Pulaski apparently have attempted to malign our
reputations by characterizing us as "pump and dumpers," conveying that we
engage in stock manipulation for short-term gains. This ludicrous and
rather desperate accusation can be easily disproved by examining Third
Point's publicly filed Schedule 13F filings or by reviewing Chap-Cap
Partners' numerous public corporate initiatives all involving long-term
holding periods (not to mention that we didn't sell a single share during
BindView's post Schedule 13D stock run-up).

We remain disappointed by the continued refusal of certain senior
BindView officials to engage in a dialogue with us despite our sizable
ownership of BindView shares. Indeed, we found Mr. Gardner's and Mr.
Pulaski's continued silence in the face of our request for a meeting so
baffling that we decided that it was important to learn more about the
Board of Directors, which is duty-bound to oversee management's
performance. With this in mind, we began this process by conducting a
Nexis-Lexis search on Mr. Peter L. Bloom, who represents prominent
venture capitalist General Atlantic Partners LLC on BindView's Board. Our
search on Mr. Bloom and General Atlantic followed a multitude of failed
attempts to speak with Mr. Bloom directly. Had Mr. Bloom returned our
several dozen phone calls, we would have been able to obtain General
Atlantic's background and affiliation record directly from him. Yet, for
some reason, even the public knowledge that our group had become
BindView's largest non-management shareholder didn't warrant the courtesy
of a return call.

Nonetheless, it was our expectation that the investigation of General
Atlantic would yield nothing but an impressive investment track record,
unblemished by unsavory matters of any kind. Indeed, given General
Atlantic's past reputation during the bull market for integrity and sound
judgment, we had taken comfort in the fact that General Atlantic remained
a significant shareholder in BindView and had Mr. Bloom on the Company's
Board. What we discovered, however, was a troubling coincidence of
litigation and shareholder value destruction associated with public
companies in General Atlantic's portfolio.

Given our predisposition and initially favorable (though un-researched)
impression of General Atlantic, one cannot imagine our shock and
disillusionment when we first learned that General Atlantic was involved
as an investor and on the Supervisory Board of another publicly traded
software company, Baan Company, N.V. Baan allegedly engaged in a
fraudulent scheme involving sales to affiliates in order to inflate
revenues according to numerous class action suits brought against that
company. Our distress was compounded when we read that while reportedly
on the Supervisory Board and Audit Committee, Messrs. Grabe and Hodgson,
senior members of General Atlantic, each reportedly sold 40,000 shares of
Baan common stock to the public while General Atlantic affiliates
reportedly sold approximately 559,000 shares to the public. According to
a complaint filed in federal court, those shares were trading at about
$45.00 per share at the time of the alleged scheme. Given General
Atlantic's prior reputation for probity, we were surprised and troubled
by various Plaintiffs' allegations, including the following statement:

"Plaintiffs allege facts which suggest that by this point in time, at
least some of the defendants may have been aware of signs of trouble.
Plaintiffs...claim that Baan's channel partners informed Baan they were
having difficulty selling Baan's software to end-users, resulting in a
backlog of unsold goods and their inability to accept more Baan products
for resale."1

We do not mean to suggest that we have concluded that these allegations
have any merit. Nonetheless, they suggest that contrary to our perception
of General Atlantic, Plaintiffs appear to envision a scenario where
members of Baan's Audit Committee might have been aware of Baan's serious
operating difficulty at the time that Baan's chairman was promoting the
stock, and thus put forth the theory that Messrs. Grabe and Hodgson, and
General Atlantic sold with apparent impunity to an unsuspecting public.
While we find such scenarios hard to fathom given the integrity that
General Atlantic had been thought to possess, it is something we think
the Board and BindView's shareholders should consider further.

Elevating our concerns over Mr. Bloom's stewardship, moreover, was our
discovery of litigation filed against him and others alleging fraud and
accounting irregularities in connection with General Atlantic's portfolio
company SS&C Technologies (NASDAQ: SSNC). SS&C ultimately settled that
lawsuit for $8.8 million in cash and stock. In the lawsuit, which we hope
was completely without merit (notwithstanding the significant cash and
stock paid to shareholders as part of the settlement), SS&C was accused
of having "overstated revenues and earning(s) . . . by recognizing
revenue for which: (1) substantial obligations were owed to the customers
before SS&C would receive payment and (2) substantial uncertainty existed
concerning SS&C's ability to complete these obligations and then receive
payment.").2 According to the complaint, SS&C recognized revenue on the
license or service agreements at the time an agreement was signed,
contrary to statements in the Prospectus that the revenue would be
recognized only when SS&C's obligations to the customer were
substantially satisfied. We are especially troubled by these allegations
regarding problems experienced by SS&C in light of the outstanding issue
of revenue recognition by BindView on sales still subject to a 30-day
return contingency.

Our research also turned up evidence suggesting that Mr. Bloom's
involvement in public companies seeming to lack proper financial controls
may not end with SS&C or BindView. Completing a rare "hat trick" for
involvement in companies with "financial issues," Mr. Bloom's only other
current public directorship seems to be with Predictive Systems Inc.
(NASDAQ: PRDS) currently trading at about $1.45 per share, down well over
90% from its recent high of $23 5/16 just last November. On January 18,
2001, Predictive announced "revenue for the fourth quarter is estimated
to be $23.5 million and pro forma loss per basic share (which excludes
amortization of intangibles, acquisition costs and one-time accounts
receivable write-offs) is estimated to be ($0.05), compared to consensus
revenues estimates of $25.8 million and earnings of $0.04."

However, on February 8, 2001, just 21 days later, Predictive surprised
and further disappointed Wall Street and reported that they would fall
significantly short of the just-reduced guidance for the quarter.
"Consolidated revenue for the quarter was $21.2 million." Only after the
company used an arcane pro forma reporting methodology did the company
report its loss of $0.05 per share. Fortunately, the recent announcement
that Predictive received the resignation of its floundering CEO, who like
Mr. Gardner presided over a 90%+ diminution of that company's valuation,
gives us some hope that Mr. Bloom might belatedly act in the
shareholders' interests and cause a similar "employee headcount
reduction" from the top of BindView's employee roster. Our group would
certainly endorse Mr. Pulaski resuming the role as Chief Executive until
a replacement could be found or the Company is sold.

By this point in our due diligence, we had become somewhat disillusioned
by the disparity between General Atlantic's past reputation and the
picture painted by the events cited above. We hoped that these
accusations and debacles were a mere coincidence to General Atlantic's
ownership. However, to our great concern, the controversial accounting
tactics apparently employed by several of General Atlantic's venture
capital-backed companies may not end with Predictive Systems, Baan
Company, SS&C or BindView.

Dr. Howard Shilit, author of "Financial Shenanigans" and President of the
Center for Financial Research and Accounting ("CFRA"), and a Professor of
Accounting at American University, has a respected consulting company
that highlights certain companies that he believes have perpetrated
accounting gimmicks and sometimes outright fraud via aggressive
accounting techniques. General Atlantic's portfolio has the grim
distinction of having at least seven companies in its present or past
roster featured in CFRA reports (Eclipsys Corp, Proxicom, SS&C
Technologies, Baan Company, LHS Group, Priceline.com and Manugistics
Group). Most of these were cited for using aggressive revenue recognition
as well as attempts to mask deteriorating operations using accounting
techniques not deemed conservative.

While we continued to reach for any evidence that this could all be some
kind of strange coincidence, we were troubled by the appearance of what
might be perceived as pattern of controversial or aggressive accounting
schemes employed by General Atlantic's portfolio companies. While we do
not mean to suggest that General Atlantic has ever intentionally
attempted to mislead public investors in its portfolio companies, we are
nonetheless concerned that the coincidence that affected so many of its
portfolio companies might inevitably cast a shadow on General Atlantic
and in turn on BindView.

Contrary to what we would like to believe about General Atlantic -- and
to what we had supposed before conducting our own checks -- it has begun
to appear to Third Point Management and Chapman Capital that General
Atlantic may have pursued an overall investment strategy of reliance upon
the proverbial "greater fool." While this would not match our
preconception of the firm's reputation, General Atlantic's portfolio of
public and private companies suggests that General Atlantic either (a)
accepted the hyperbole that fueled the unrealistic and unsustainable
valuations during the heady days of the Internet bubble or (b) determined
the pubic market to be a willing buyer of various companies with doubtful
paths to profitability. As Mr. Loeb's own experience as an employee of a
highly respected venture firm taught him, every venture capital firm has
its share of lemons. However, a survey of General Atlantic's portfolio
exposes enough stocks trading around or under two dollars per share to
place lemonade stands on every street corner in America.

Following our investigation into Mr. Bloom and General Atlantic, we were
even more confused as to why they seemed to lack real concern over
BindView's tumultuous fall from grace. As previously discussed, on
numerous occasions we have attempted to contact Mr. Bloom to introduce
ourselves and get a sense for his view of BindView's apparent management
difficulties. In Mr. Bloom's place Mr. Loeb received a return call from a
young sounding man who presented himself as "Peter's partner" (this was
prior to Mr. Loeb's discussion with Mr. Matthew Nimetz). Mr. Loeb
introduced himself as one of BindView's largest shareholders and asked
this individual for his thoughts on the company's management and the
March restatement of its fourth quarter financial statements. Upon
hearing that Mr. Bloom's partner was "happy" with BindView's performance,
Mr. Loeb requested confirmation that he represented General Atlantic's
views given BindView's shares were trading at 50% of their IPO price and
95% less than their level of a year earlier. Mr. Bloom's partner
confirmed his prior statement saying something to the effect of "This is
not a problem for us ... we sold over three million shares for more than
$10 per share." Shocked by this display of disregard for those who bought
General Atlantic's shares, not to mention that General Atlantic still
owned over 2.5 million shares (according to last proxy statement), Mr.
Loeb could not contain himself, telling Mr. Bloom's partner that only a
"fricking moron would tell a public investor that." We both stand by that
contention, and feel that Mr. Bloom's partner has solved part of the
mystery over General Atlantic's apparent nonchalance in these matters.

As for Mr. Bloom in particular, who is duty bound to protect
shareholders' interests on BindView's Board, let me disabuse General
Atlantic of any notion that it may be better served from a public
relations perspective by sitting idly while BindView's shares plummet to
new lows. As a former venture capitalist (having been employed by E. M.
Warburg, Pincus & Co. from 1984 to 1987), Mr. Loeb is familiar with the
notion that displaying a firm hand with management (no matter how inept)
might weaken General Atlantic's attraction to prospects. However, we are
confident that Mr. Bloom and Mr. Nimetz (who accepted a call from me on
one occasion) of General Atlantic will appreciate that once General
Atlantic chose to maintain its investment in the now-public company
(whether it chose or was forced to hold the shares it did not sell in the
1998 secondary offering at roughly four times today's share price), Mr.
Bloom's fiduciary responsibility to BindView's shareholders supersedes
its desire to maintain a friendly public reputation.

Let me make one more point crystal clear: BindView's cash balances are
not a honey pot to be used in an attempt to spend the company out of its
current predicament. If anyone thinks that management and the Board have
time and money on their side to work out current problems, they would be
seriously mistaken. To the contrary, with every day passed and dollar
lost, each Board member's personal and professional downside deepens
further. As your understanding of the two of us improves going forward,
we are confident you will come to agree with that view.

As you know, we have collected industry perspective and research and
engaged in very preliminary discussions with potential strategic buyers
of BindView Corporation. Subsequent to our filing, we have also contacted
certain investment banks regarding the potential sale of the Company. We
should remind you that part of any portfolio manager's duties is the
collection of industry perspective and other research regarding public
companies in one's fund. Our discussions with BindView's competitors
clearly falls into this research category, and we intend to commence
discussions with BindView's public customer base in the coming weeks to
further our understanding of the Company's products and services. Thus
far, our public filings have contained glowing preliminary commentary on
the high quality of BindView's employees, products and services. We hope
that our further research will support these initial views.

We note your statement that "[t]he BindView Board of Directors is elected
by the shareholders, and its management is appointed by the Board, to
manage the company in the best interests of the company and its
shareholders". Rest assured that Chapman Capital and Third Point
Management Company are well versed in the respective rights, duties and
obligations of corporate shareholders, managers, and directors, including
the requirement that directors discharge their duties to shareholders
with the utmost good faith, loyalty, due care, and candor. We hope that,
in light of these duties, the BindView Board of Directors will not try to
continue to stonewall and reject a dialogue with BindView's largest
non-management shareholder group regarding our concerns about the
Company. Regardless of the action you take, however, we will continue to
use every legal means possible to protect our interests and those of our
fellow public shareholders.

Moving back to Mr. Gardner's non-substantive letter, his statement that
"we also disagree with much of the content of your letters" suggests that
he is backing down from previous public accusations that we made "false
statements." We are still awaiting Mr. Gardner's apology for that
inflammatory and potentially slanderous remark. We suggest that Messrs.
Gardner and Pulaski be truthful in future discussions about Third Point
Management and Chapman Capital lest they expose the company and its Board
to greater legal liability than they may have already incurred following
the fourth quarter financial restatements and coincidental insider sales.
In particular, any false statement accusing Mr. Chapman or Mr. Loeb of
impersonating BindView employees or stock manipulation will not be
tolerated.

We are sure that nobody wishes to see the Company embroiled in
shareholder litigation. However, we are concerned that the members of the
Board have made themselves tempting targets to such a lawsuit due to the
sharp decline in BindView's share price, the suspicious timing of the
fourth quarter restatement of revenues and profits, certain coincident
stock sales and the opportunistic departure of Mr. Plantowsky as
BindView's chief financial officer. Ideally, we would like to set aside
the combative tone that has made its way into recent communications and
work in a discreet and constructive manner with the Board to facilitate a
sale of the Company. We hope you share our willingness to begin such a
dialogue. However, to date we do not feel that progress is being made in
that area and thus we have continued communicating with you through
whatever channels you force us to use. Once again, this is not our first
choice, but the Board and Messrs. Gardner and Pulaski in particular have
left us with no alternative.

It is not our intention to embarrass Mr. Bloom or his partners at General
Atlantic. We think that by backing such companies as Baan, Priceline,
Tickets.com and others (the extraordinary list is available for public
view on General Atlantic's website: www.gapartners.com) they have
determined their own status in the investment community. It is our desire
to share with you our views, formed after a review of publicly available
information, that Mr. Bloom in particular and General Atlantic as an
entity have done little to earn BindView shareholders' confidence in
their business judgment or in their suitability to act as fiduciaries for
the public shareholders of the Company. Moreover, we are worried that
given the apparent problems in General Atlantic's overall portfolio,
those venture capitalists might be distracted by their many seemingly
distressed companies and therefore might be unable or reluctant to take
action with respect to their investment in BindView. ACCORDINGLY, WE
BELIEVE THAT IT WOULD BE IN THE BEST INTEREST OF BINDVIEW SHAREHOLDERS IF
MR. BLOOM WERE TO STEP DOWN FROM THE COMPANY'S BOARD OF DIRECTORS AND
GENERAL ATLANTIC WERE TO DISTANCE ITSELF FROM THE COMPANY. We may be
interested in proposing our own nominees to the Board at some point in
the future, and will go through proper avenues should we decide to take
that course of action.

As much as we would like to have handled our communications with the
BindView Board of Directors either telephonically or in person, for
reasons outlined above we were forced to state our views in writing.
Moreover under S.E.C. Rule 13d, we are required to file this letter as an
amendment to our earlier filing due to the material nature of our request
that Company director Peter Bloom resign.

We look forward to a prompt and substantive response.

Very truly yours,                                 Very truly yours,

/s/ Daniel S. Loeb                                /s/ Robert L. Chapman,
Jr.

Daniel S. Loeb                                    Robert L. Chapman, Jr.
Managing Member                                   Managing Member
Third Point Management Company L.L.C.             Chapman Capital L.L.C.


cc:  Jack Nusbaum, Esq.
     Matthew Nimetz, Esq.

-------------------
Complaint, In re Baan Company Securities Litigation; Civil Action No.
98-2465 (D..D.C., June 2, 2000). Court For The District of Columbia,
filed June 2, 2000.

Complaint, Marc Feiner, M.D., etal., v. SS&C Technologies, et al., Civil
Action No. 3-97-CV-00656(JCH) US District Court For The District Of
Connecticut (D. Conn, March 31, 1998).


BRIGHTPOINT, INC: Court Grants Motion to Dismiss Securities Litigation
----------------------------------------------------------------------
Brightpoint, Inc. (NASDAQ:CELL) announced that United States District
Court for the Southern District of Indiana has entered final judgment
dismissing the consolidated case filed by a purported class of purchasers
of the Company's common stock during the period October 2, 1998 through
March 10, 1999.

The Company and certain of its officers and directors filed a motion to
dismiss the action and the court granted such motion on March 29, 2001,
subject to the plaintiffs right to file a motion for leave to amend the
complaint before April 26, 2001. The plaintiffs did not file such a
motion and the court has entered final judgment dismissing the action.

Brightpoint, Inc. is a leading provider of outsourced services in the
global wireless telecommunications and data industry. Brightpoint's
innovative services include customized packaging, prepaid and e-commerce
solutions, inventory management, distribution and other outsourced
services. Brightpoint's customers include leading network operators,
retailers and wireless equipment manufacturers. Additional information
about Brightpoint can be found on its website at www.brightpoint.com or
by calling its toll-free Investor Relations Information line at
877-IIR-CELL (877-447-2355).


CENDANT CORP: Can Sue Accountants Over Shareholder Payments
-----------------------------------------------------------
The federal judge overseeing the litigation caused by Cendant Corp.'s
1998 stock plunge says the company can pursue its suit to recoup any
losses caused by Ernst & Young.

The accounting firm sought dismissal on grounds that the litigation was
barred by securities law, arguing in particular that its $355 million
settlement with Cendant's shareholders in 1999 obviated an additional
payment to the company itself.

But in his April 12 opinion, U.S. District Judge William Walls ruled that
all but one of Cendant's claims for negligence, fraud and breach of
contract were legally sustainable.

The decision clears the way for Cendant to continue the case and try to
prove liability and win damages at trial or seek a settlement with Ernst
& Young to recover some of the $3 billion the company paid shareholders
to settle a class-action fraud case.

"This is now the springboard to allow Cendant's claims to go forward,"
says Cendant's counsel, Michael Rosenbaum of Short Hills' Budd Larner
Gross Rosenbaum Greenberg & Sade.

Shares of Cendant, which was created in 1997 by the merger of CUC
International Inc. of Stamford, Conn., and HFS Inc. of Parsippany, lost
billions of dollars in value in April 1998 after the company announced it
had discovered irregularities in CUC's premerger accounts.

Cendant, now in New York, has alleged that CUC executives created $500
million in fake revenue to make the company an attractive merger partner
and that as CUC's outside accounting firm Ernst & Young failed to report
the wrongdoing or knowingly and recklessly facilitated it. *Ernst & Young
denied the charges and sought dismissal on several grounds.

It argued that the Private Securities Litigation Reform Act, designed to
foster settlements and curb the excesses of class-action plaintiffs, does
not allow contribution claims by settled defendants or allow
indemnification claims.

The accounting company also argued that it had no fiduciary duty to the
company, that the breach of contract claim was defectively drawn and that
the negligence and malpractice claims didn't comply with New Jersey's
Affidavit of Merit statute.

Walls did dismiss one count of the complaint, agreeing with Ernst & Young
that the PSLRA barred Cendant, as a settling defendant, from seeking a
contribution under Section 11 of the Securities Act of 1933. Eleven other
counts survived.

Ernst & Young argued that Cendant's state law claims alleging breach of
contract, negligence, fraud and breach of fiduciary duty were really
claims for indemnification, which also are barred by the PSLRA. Walls
ruled, however, that the claims were independent allegations that are not
pre-empted by federal securities law.

He found that Cendant had standing to assert breach of contract claims
even though the shareholders of the company that hired Ernst & Young,
Cendant predecessor HFS, have benefited from the class-action
settlements.

"That the shareholders may have already been compensated by the company
and by E&Y does not lessen the harm to the corporation," he wrote.
"Similarly, even if the shareholders receive a 'duplicative and indirect'
benefit, that does not eliminate the corporation's right to recovery."

On the professional negligence counts, he said the law of HFS's home
base, Connecticut, applies and that state has no affidavit-of-merit
requirement.

He also rejected Ernst & Young's argument that it was relieved of its
contract responsibilities by CUC's failure to provide correct information
for the audit. "The very duty it undertook was to exercise due care and
disclose any acts of fraud it uncovered," Walls said.

Ernst & Young attorneys at Roseland's Lowenstein Sandler referred calls
to corporate headquarters in New York. Spokesman Les Zukie says, "We are
pleased that the judge dismissed the Section 11 claim against Ernst &
Young but disagree with his decision not to dismiss the remaining claims.
We continue to believe those claims have no merit and intend to seek
review of the judge's decision by the appellate court." (New Jersey Law
Journal, April 30, 2001)


CHICAGO: Enjoined From May 1 Increase for Retiree Healthcare Premiums
---------------------------------------------------------------------
The following statement was issued by Krislov & Associates, Ltd:

In litigation spanning nearly fourteen years so far, Circuit Court Judge
Lester B, Foreman entered an order enjoining the City of Chicago from
going forward with May 1 increases in retirees' healthcare premiums,
amounting in some cases to 100% increases.

                         Background

The litigation began in October 1987 when the City sued the trustees of
the Police, Fire, Municipal Employees and Laborers Funds to free itself
from the obligation to provide retiree healthcare coverage under a fixed
rate plan then in effect. Participants intervened and were certified as a
class, asserting that they had an enforceable right to the fixed rate
plan for life. In 1988, the City and Pension Funds agreed among
themselves to an interim 10 year settlement period, to enable the parties
to negotiate a permanent resolution. When that 10 years passed without a
final permanent resolution being reached, the participants sought to
reinstate their claims. Although originally rebuffed by the Circuit
Court, they appealed and the Appellate Court, last June, ordered their
claims reinstated.

                       Current Issues

Although the City and participants' class counsel have engaged in
discussions, no settlement has been reached for the participants' claims
[for participants via retirees as of 12/31/87, or those who retired
during the period 1/1/88 to 8/23/89]. This spring the City announced its
intention to raise rates, by another 100% in many cases, effective May 1,
2001. The Court granted class counsel Krislov's emergency motion to
enjoin the announced changes until the Court is able to address the
merits of the participants' claims.

The next status is set for May 7, 2001 at 2 p.m.

Class Counsel Krislov was quoted: "We are pleased that the Court
recognized the importance of these retirees' situation. Judge Foreman
commented that these people have given their lives to the City and it
owes them something in return."

Krislov announced his intention to hold the City to its promises to its
employees for their protection under contract as well as the Illinois
Constitution.

Contact: Clint Krislov of Krislov & Associates, 312-606-0500, facsimile,
312-606-0207, or email, clint@Krislovlaw.com


CISCO SYSTEMS: Scott + Scott Expands Period in Shareholder Lawsuit in CA
------------------------------------------------------------------------
Scott & Scott, LLC (scottlaw@scott-scott.com), a Connecticut-based law
firm, filed an updated class action in the United States District Court
for the Northern District of California on behalf of purchasers of Cisco
Systems, Inc. (Nasdaq: CSCO) common stock during the period between
August 10, 1999 and April 16, 2001 (the "Class Period").

The complaint charges Cisco and certain of its officers and directors
with violations of the Securities Exchange Act of 1934. Cisco and its
subsidiaries are engaged in selling products for networking in the
Internet. The complaint alleges that by the beginning of the Class Period
in August 1999, Internet Service Providers and competitive local
telephone companies had technology to deploy, but they had little
capital, and Cisco used this as an opportunity to increase its sales by
providing capital financing to such companies. Cisco, however, made such
financing conditional upon the purchase of large amounts of Cisco
product. Through this alleged manipulation and the shipment of defective
or incomplete product, as well as Cisco's failure to adequately accrue
for excess and overvalued inventory and uncollectible finance
receivables, Cisco was able to report "record" earnings each quarter
during the Class Period. Defendants thus made positive but false
statements about Cisco's products, financial results and business during
the Class Period. As a result, Cisco's stock traded as high as $82.

The inflation in Cisco's stock price was essential to its main corporate
strategy, that of growth through acquisition, which Cisco accomplished
through the exchange of inflated Cisco shares. In addition, each of the
defendants had the motive and the opportunity to perpetrate the
fraudulent scheme and course of business described herein in order to
sell $595 million worth of their own Cisco shares at prices as high as
$80.24 per share, or 84% higher than the price to which Cisco shares
dropped after the end of the Class Period, as the true state of Cisco's
business and prospects began to reach the market.

After completing more than 20 major acquisitions between 9/99 and 2/01,
by issuing more than 400 million shares of Cisco stock, and selling more
than 10 million shares of their personal Cisco holdings, on 2/6/01, Cisco
announced extremely disappointing 2nd Quarter Fiscal 2001 results,
including EPS of only $ 0.18. This disclosure shocked the market, causing
Cisco's stock to decline to less than $30 per share before closing at
$31-1/16 per share on 2/7/01, on record volume of more than 279 million
shares, inflicting billions of dollars of damage on plaintiff and the
Class. Cisco later admitted that 3rd Quarter Fiscal sales would be less
than $4.8 billion, or lower than any quarter since the 2nd Quarter Fiscal
2000. Defendants' misconduct has wiped out over $400 billion in market
capitalization as Cisco stock has fallen 84% from its Class Period high
of $82 per share as the truth about Cisco, its operations and prospects
began to reach the market. On 4/16/01, Cisco announced a $2.5 billion
write-down of inventory (or 90% of its inventory as of 1/31/01) of
components in its service business. This was one of the largest inventory
write-downs in U.S. history. Cisco stock has dropped to as low as
$13-3/16.

Contact: David R. Scott or Neil Rothstein, nrothstein@scott-scott.com,
both of Scott & Scott, 800-404-7770, or scottlaw@scott-scott.com


DOLLAR GENERAL: Cauley Geller Announces Securities Lawsuit in TN
----------------------------------------------------------------
The Law Firm of Cauley Geller Bowman & Coates, LLP announced on May 1
that it has filed a class action lawsuit in the United States District
Court for the Middle District of Tennessee on behalf of purchasers of
Dollar General Corp. (NYSE: DG) ("Dollar General" or the "Company")
common stock during the period between May 12, 1998 and April 27, 2001
(the "Class Period"), and suffered damages thereby.

The complaint charges Dollar General and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. The
Company offers a focused assortment of consumable basic merchandise,
including health and beauty aids, packaged food products, cleaning
supplies, housewares, stationery, seasonal goods, basic apparel and
domestics.

On April 30, 2001, the Company issued a press release entitled, "Dollar
General Expects to Restate Earnings; Maintains Current Year Guidance."
The press release stated in part, "Dollar General Corporation announced
today that it expects to delay the filing of its annual report on Form
10-K for the fiscal year 2000 in anticipation of restating its audited
financial statements for fiscal years 1998 and 1999 as well as restating
the unaudited financial information for the fiscal year 2000 as
previously released. The Company has become aware of certain accounting
irregularities, and the audit committee of the Company's board of
directors is conducting an investigation of these irregularities." On
this news, trading in Dollar General shares plunged to $ 16.50, or more
than 37% lower than the Class Period high of $26. If you bought the
common stock of Dollar General between May 12, 1998 and April 27, 2001,
you may, no later than June 29, 2001, request that the Court appoint you
as lead plaintiff.

Contact: Charlie Gastineau or Sue Null, both of Cauley Geller Bowman &
Coates, LLP, 888-551-9944


DOLLAR GENERAL: Charles J. Piven Announces Securities Lawsuit
-------------------------------------------------------------
Law Offices Of Charles J. Piven, P.A. announced on May 1 that a private
securities action requesting class action status has been initiated on
behalf of purchasers of Dollar General Corp. (Nyse:Dg)

All persons or entities who purchased the common stock of Dollar General
Corp. during the period May 12, 1998 through and including April 27,
2001.

No class has yet been certified in the above action. Until a class is
certified, you are not represented by counsel unless you retain one. If
you purchased the stock listed above during the class period, you have
certain rights. To be a member of the class you need not take any action
at this time, and you may retain counsel of your choice.

Contact: Law Offices Of Charles J. Piven, P.A., Baltimore Charles J.
Piven, 410/986-0036 pivenlaw1@erols.com


DOLLAR GENERAL: Milberg Weiss Files Securities Suit in Tennessee
----------------------------------------------------------------
Milberg Weiss (http://www.milberg.com/dollar/)announced on April 30 that
a class action has been commenced in the United States District Court for
the Middle District of Tennessee on behalf of purchasers of Dollar
General Corporation (NYSE:DG) publicly traded securities during the
period between May 12, 1998 and April 27, 2001 (the "Class Period").

The complaint charges Dollar General and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. The
Company offers a focused assortment of consumable basic merchandise,
including health and beauty aids, packaged food products, cleaning
supplies, housewares, stationery, seasonal goods, basic apparel and
domestics.

On April 30, 2001, the Company issued a press release entitled, "Dollar
General Expects to Restate Earnings; Maintains Current Year Guidance."
The press release stated in part, "Dollar General Corporation announced
today that it expects to delay the filing of its annual report on Form
10-K for the fiscal year 2000 in anticipation of restating its audited
financial statements for fiscal years 1998 and 1999 as well as restating
the unaudited financial information for the fiscal year 2000 as
previously released. The Company has become aware of certain accounting
irregularities, and the audit committee of the Company's board of
directors is conducting an investigation of these irregularities." On
this news, trading in Dollar General shares plunged to $ 16.50, or more
than 37% lower than the Class Period high of $26.

Contact: Milberg Weiss Bershad Hynes & Lerach LLP William Lerach,
800/449-4900 wsl@mwbhl.com


DOLLAR GENERAL: Wechsler Harwood Files Securities Suit in TN
------------------------------------------------------------
Wechsler Harwood Halebian & Feffer LLP ("Wechsler Harwood") filed a
securities class action lawsuit in the United States District Court for
the Middle District of Tennessee on behalf of all investors who purchased
the securities of Dollar General Corporation ("Dollar General") (NYSE:
DG) in the period between May 12, 1998 and April 27, 2001 (the "Class
Period").

The complaint charges that Dollar General, along with certain officers
and directors ("Defendants"), violated Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
The complaint alleges that during the Class Period the defendants issued
materially false and misleading financial statements contained in filings
with the Securities and Exchange Commission and press releases that,
inter alia, overstated the Company's financial condition by overstating
earnings in violation of Generally Accepted Accounting Principles.

On April 30, 2001, the Company issued a press release entitled, "Dollar
General Expects to Restate Earnings; Maintains Current Year Guidance."
The press release stated in part, "Dollar General Corporation announced
today that it expects to delay the filing of its annual report on Form
10-K for the fiscal year 2000 in anticipation of restating its audited
financial statements for fiscal years 1998 and 1999 as well as restating
the unaudited financial information for the fiscal year 2000 as
previously released. The Company has become aware of certain accounting
irregularities, and the audit committee of the Company's board of
directors is conducting an investigation of these irregularities." On
this news, the price of Dollar General shares plunged to $ 16.50 per
share, or more than 37% lower than the Class Period high of $26.

Contact: Patricia Guiteau, Shareholder Relations Department of Wechsler
Harwood Halebian & Feffer LLP, 877-935-7400, pguiteau@whhf.com


DRUG PRICE-FIXING: Judge Grants Prelim. Approval Of $100 Mil Settlement
-----------------------------------------------------------------------
A federal judge has given preliminary approval to a $100 million
settlement with generic drug maker Mylan Laboratories and three other
companies accused of fixing prices of anti-anxiety drugs.

The settlement, approved by U.S. District Court Judge Thomas F. Hogan in
Washington, D.C., covers consumers and state agencies in all 50 states
and the District of Columbia.

Under the settlement, $72 million will be used to reimburse consumers,
and the rest will go to state agencies. Mylan also will pay up to $8
million for the plaintiffs' attorneys' fees.

Thirty-two states and the District of Columbia filed lawsuits in 1998
accusing Mylan and the other companies of conspiring to cut off the sale
of the active ingredients for two anti-anxiety drugs to all companies
except Mylan. Because of strong demand and no competition,
Pittsburgh-based Mylan was able to increase the prices of the drugs,
lorazepam and clorazepate by more than 2,000 percent.

The drugs are widely used by senior citizens to treat Alzheimer's disease
and other ailments.

Consumers who bought the drugs from Jan. 1, 1998, through Dec. 31, 1999,
and were not reimbursed by insurance may be entitled to a refund for the
overcharges, Davis said.

Mylan did not admit any wrongdoing as it agreed to settle claims against
it and the other companies, ingredient manufacturer Profarmaco of Milan,
Italy; distributor Gyma of Westbury, N.Y.; and Cambrex of East
Rutherford, N.J. SST Corp. separately agreed to a $500,000 cash
settlement.

The consumer claims period starts June 1 and ends Sept. 29.

Consumers who have claims during the filing period would not receive
refunds until the court grants final approval of the settlement. A
hearing is set for Nov. 29.

Claim forms can be obtained at the settlement Web site at
www.agsettlement.com. (The Associated Press, April 30, 2001)


DYNAMEX INC: Gets Prelim Approval for Securities Suit Settlement in TX
----------------------------------------------------------------------
Dynamex Inc. (AMEX:DDN) announced on April 30 that the Company has
received preliminary approval from the U.S. District Court for the
Northern District of Texas of the Stipulation of Settlement in the class
action lawsuit, as well as agreements to settle claims with Reliance
Insurance Company, Deloitte & Touche LLP and Deloitte & Touche. The final
hearing has been set for June 28, 2001.

The Company expects a net recovery of approximately $750,000 in
connection with the Company's claims against Reliance Insurance Company,
Deloitte & Touche LLP and Deloitte & Touche with any additional proceeds
being contributed to the settlement of the shareholder class action. More
complete details concerning the settlement will be sent to potential
class members in a notice of settlement and published on the Business
Wire. The potential class members include all persons who purchased the
common stock of Dynamex Inc. during the period beginning September 18,
1997 and ending September 17, 1999.

Dynamex will use its net recovery to offset the Company's remaining cash
obligation under the terms of the settlement of$650,000, that is payable
10 business days prior to the scheduled final hearing date. The Company
has ample cash and credit availability to fund its obligations under the
settlement.

Rick McClelland, Chairman and CEO, commented, "We are pleased to take a
significant step toward the resolution of this litigation. We look
forward to the final settlement so we can focus all of our attention on
growing the business and increasing shareholder value."

Dynamex is a leading provider of same-day delivery and logistics services
in the United States and Canada. Additional press releases and investor
relations information as well as the Company's internet e-commerce
services package, dxNow(TM), are available at www.dynamex.com and
www.dxnow.com.


F.B.I.: Judge Approves Settlement in Bias Lawsuit Filed By Black Agents
-----------------------------------------------------------------------
A federal judge approved a new settlement in a 10-year-old discrimination
lawsuit filed by black agents against the Federal Bureau of
Investigation.

The settlement, approved by Judge Thomas Hogan of Federal District Court
here, established a 2004 deadline for new job evaluation, promotion and
disciplinary procedures.

In their class-action lawsuit, the black agents complained that the
bureau's promotion system was supposed to be based on merit, but was in
reality heavily influenced by personal relationships that blocked blacks
from becoming supervisors.

F.B.I. officials had agreed to make the changes sought in the suit in
1993, but missed deadlines for them, said David J. Shaffer, a lawyer for
the black agents. The lawsuit was reinstated in 1999.

The bureau said that it had complied with most of its obligations under
the settlement, but acknowledged that "some work remained to be done" in
1998.

The statement said the F.B.I. director, Louis J. Freeh, would fulfill the
commitments under the agreement, which stipulates that the bureau must
establish new promotion procedures for supervisors by 2004.

Agents will also be able to have some employment claims referred to an
outside mediator, an unusual concession for an agency that fiercely
guards its promotion and disciplinary procedures. Agents who win claims
would be eligible for lost wages and up to $300,000 in damages. (The New
York Times, May 1, 2001)


FEN-PHEN: Judge Rejects Privilege For 9,500 AHP Documents
---------------------------------------------------------
In a significant victory for the plaintiffs in the fen-phen diet drug
cases, a federal judge has ruled that American Home Products must turn
over thousands of documents after rejecting its argument that they are
privileged under the "common interest doctrine."

AHP's lawyers argued that it never waived the privilege when it shared
the documents with Interneuron Pharmaceuticals Inc. and Les Laboratories
Servier because all three companies shared the identical legal interest
of persuading federal regulators to remove the drugs fenfluramine and
dexfenfluramine from lists of "controlled substances." But Senior U.S.
District Judge Louis C. Bechtle found that AHP's interests were neither
truly "legal" nor "identical" to Interneuron's and Servier's.

In his 20-page memorandum announcing his ruling in PreTrial Order No.
1910, Judge Bechtle upheld all of the decisions of court-appointed
Special Discovery Master Gregory Miller. Although AHP has entered into a
massive settlement, the ruling is nonetheless significant because the
documents can now be used by plaintiffs who opted out of the settlement
and intend to take their cases to trial.According to court papers, AHP
refused to turn over about 9,500 documents on the basis of privilege. As
required under Federal Rule of Civil Procedure 26(b)(5), AHP prepared a
privilege log identifying the withheld documents.

Lead plaintiffs' attorneys Michael D. Fishbein and Laurence S. Berman of
Levin Fishbein Sedran & Berman disputed the adequacy of AHP's privilege
log and the validity of the privileges. They also argued that any
privilege was waived because the documents were exchanged between AHP,
Interneuron and Servier.

AHP's lawyers at Arnold & Porter in Washington argued that Interneuron,
Servier and AHP had a collective common interest in descheduling these
drugs and that, as a result, it properly withheld all documents exchanged
between or shared with Interneuron and/or Servier concerning descheduling
efforts related to the diet drugs. In June 1999, Special Master Miller
found that only some of the documents were truly privileged and that a
portion of those were protected by the common interest doctrine. But for
the remaining documents, Miller found there was either no privilege or
that the privilege had been waived by sharing the documents among the
three companies.

To understand the rulings, it's important to understand the relationships
between AHP, Interneuron and Servier. Servier held the international
patent rights to both fenfluramine and dexfenfluramine. In 1963, Science
Union & Co., a Servier affiliate, entered into a licensing agreement with
A.H. Robins Co. giving it the right to market fenfluramine in the United
States. AHP acquired Robins in 1989. The licensing agreement with Science
Union/Servier required AHP to seek FDA approval of fenfluramine. If
approval was obtained, it also required AHP to pay royalties to Servier
until 1988. In 1973, SmithKline Corp. filed a patent infringement suit
against AHP, Servier and Science Union Co. over fenfluramine. In February
1990, Servier entered into a licensing agreement with Interneuron,
granting Interneuron an exclusive license to market another diet drug,
dexfenfluramine, in the United States. The licensing agreement required
Interneuron to file for FDA approval to market dexfenfluramine in the
United States and, if successful, to pay royalties to Servier. In
November 1992, Interneuron and American Cyanamid (AHP's predecessor in
interest), entered into a sublicensing agreement for the patent of
dexfenfluramine. The agreement gave AHP the right to comment on drafts of
the FDA application for dexfenfluramine and said Interneuron was
responsible for attempting to have dexfenfluramine "descheduled" or
relieved of the scheduling requirements under the Controlled Substances
Act. In April 1996, the FDA approved dexfenfluramine. Soon after,
Interneuron and AHP entered into another agreement which "allocated
responsibility for the reporting of adverse drug events, provided for the
parties' cooperation in the defense of any product liability claims and
provided for cross-indemnification arrangements relating to certain types
of legal claims." In September 1997, both fenfluramine and
dexfenfluramine were withdrawn from the U.S. market.

                  Special Master's Ruling

In his June 1999 ruling, Miller found that some of the documents were
privileged under the common interest doctrine. In the patent infringement
action filed by SmithKline, Miller found that AHP and Servier were
codefendants attempting to establish a common defense and that all of
their communications on that issue were protected. Likewise, Miller found
that when the diet drugs were withdrawn from the market in 1997, all
three companies AHP, Interneuron and Servier were facing potential
product liability litigation relating to the marketing of the drugs and,
therefore, that their communications on that issue were also
protected.But Miller found that none of the communications relating to
the descheduling of the drugs were privileged under the common interest
doctrine.

Now Judge Bechtle has upheld Miller's rulings in their entirety. The
purpose of the attorney-client privilege, Bechtle said, is "to encourage
full and frank communication between attorneys and their clients and
thereby promote broader public interests in the observance of law and
administration of justice." However, Bechtle said, the privilege "must be
construed narrowly" because it "obstructs the truth-finding process." The
privilege also "does not protect business and technical advice," Bechtle
found. Turning to the work product doctrine, Bechtle found that it
protects materials prepared by an attorney, or an attorney's agent, "in
anticipation of or for litigation." A lawyer's "mental impressions,
conclusions, opinions or legal theories" are also protected from
discovery, Bechtle said, but the work product privilege "is also limited
in that materials prepared in the regular course of business, even if
prepared by an attorney, are not protected."When applying the doctrine,
Bechtle said, courts must inquire whether the document was truly
"prepared or obtained because of the prospect of litigation." On that
point, Bechtle said, courts have held that "litigation must be more than
a remote possibility and the anticipation of future litigation must have
been the primary motivation which led to the creation of the documents."
Ordinarily, Bechtle said, a client's voluntary disclosure of
attorney-client privileged communications to a third party waives the
privilege.

The common interest doctrine provides an exception to that general rule,
Bechtle said, by preserving the privilege "where two or more persons or
companies that share a common interest in a legal issue exchange
privileged communications with one another." But the doctrine usually
applies only when one attorney represents multiple individuals on the
same matter, Bechtle said, in order to protect confidential
communications "shared between the clients and their attorney to
establish a defense strategy." In certain cases, he said, the common
interest doctrine extends to protect information shared between parties
with a "community of interests" or an "identical legal interest with
respect to the subject matter of a communication between an attorney and
a client concerning legal advice."But the subject matter "must be of a
legal nature something more than mere concurrent legal interests or
concerns," Bechtle found, and "there may not exist any divergence in the
interests."

AHP argued that Miller was wrong in finding that the shared
communications between AHP, Servier and Interneuron concerning
descheduling was a business interest.

But Bechtle found that Miller was correct for several reasons. "First,
AHP has not shown that the representation was joint," Bechtle wrote,
noting that while a single lawyer represented all three companies, his
representation "overlapped." While Interneuron and Servier hired the
lawyer in 1990, AHP did not retain him until 1996. "Although this lapse
alone is not determinative, it is indicative of the lack of a joint
representation," Bechtle wrote. Bechtle also found that AHP failed to
show that the interest in getting the drugs descheduled was "legal in
nature" or that the three companies had an "identical" interest .The
dexfenfluramine sublicensing agreement between AHP and Interneuron, he
said, required Interneuron to seek descheduling and provided that
Interneuron would receive payments if its efforts were successful
."Indeed, in 1991, Interneuron petitioned the DEA and FDA to deschedule
fenfluramine. Interneuron alone had that duty. Neither AHP nor Servier
shared it," Bechtle wrote. "Thus, even if descheduling is considered
legal in nature, the parties' interests were not identical." Instead,
Bechtle said, "the only common interest was commercial if the drug was
descheduled, sales would increase." But legal advice on such a commercial
issue, he said, "does not bring the communication within the protection
of the common interest doctrine."

Looking to the law of states that would look on AHP's arguments most
favorably, Bechtle found that neither the courts of New Jersey nor New
York would hold that the common interest privilege applied. "Even under
the law of New Jersey, in order to benefit from the common interest
doctrine, the interests of the two entities sharing the information must
be identical and legal, rather than commercial," Bechtle wrote.Likewise,
Bechtle said, New York courts have held that the common interest doctrine
does not extend to communications about joint business strategy that also
happen to include concern about litigation. (The Legal Intelligencer, May
1, 2001)


FEN-PHEN: New Book and Court Finalization of Settlement Revive Interest
-----------------------------------------------------------------------
Two timely events -- the publication of a finger-pointing book and the
finalization of a multi-billion-dollar settlement of a class action
lawsuit -- are returning the spotlight to fen-phen, the diet drug
combination that was wildly popular in the mid-'90s until reports linked
the drugs to illness and death.

In a new book that turns fen-phen's history into narrative drama --
complete with tragic victim stories, predatory trial lawyers,
intransigent company officials and rival factions in the U.S. Food and
Drug Administration (FDA) -- Washington author Alicia Mundy accuses
drugmaker Wyeth-Ayerst of having withheld information about the drugs'
dangers and the FDA of having failed to protect Americans from unsafe
products.

Douglas Petkus, spokesman for American Home Products (AHP),
Wyeth-Ayerst's parent, said the company had "worked closely with the FDA
and upheld all our responsibilities to physicians and consumers. . . .
Research has shown that initial concerns over damage to heart valves were
greatly overstated." Petkus characterized Mundy's book as one-sided and
inaccurate "in its portrayal of the company, the actions taken and its
motivations. . . . What she's doing is basically presenting the
plaintiffs' case."

FDA spokesman Lawrence Bachorik said, "As soon as the issue of heart
valve damage . . . reached the FDA, the agency moved promptly to issue a
public health warning and to assure products were removed from the
market."

Mundy's book, "Dispensing With the Truth" (St. Martin's Press) arrived in
stores in the Washington area, where thousands took the drugs.

Last summer's settlement of a nationwide class action suit involving some
365,000 individuals who took the drugs will be finalized when a federal
court rules on remaining appeals, slated for a hearing this month. The
settlement is designed to benefit former users whether or not they were
part of the legal class.

Fen-phen combined the serotonin-releasing drugs fenfluramine and
phentermine to reduce carbohydrate cravings without causing fatigue. The
first prescriptions were written in 1994. After researchers in July 1997
publicly tied use of the drugs to a higher risk of heart valve disease,
Wyeth-Ayerst pulled both drugs from the market. Under terms of the
pending settlement, anyone who took fen-phen or either of two "fen"
products, Redux or Pondimin, for more than 60 days and suffered heart
valve damage can seek compensation based on their age when they took the
drug and the severity of damage. The maximum payment under the settlement
is $ 1.5 million per person. Former users can also sue the company for
personal damages.

All former users are entitled to a refund of $ 30 a month for Pondimin
and $ 60 for Redux. Those who took the drugs 60 days or less and and
suffered heart damage can claim up to $ 5,000 worth of ongoing medical
surveillance. Those who took the drugs longer are entitled to a free
echocardiogram and up to $ 10,000 of surveillance. Details are posted at
www.settlementdietdrugs.com or by phone at 800-386-2070. Thousands of
individual suits involving fen-phen are still pending, according to
attorney Michael Fishbein, chief architect of the settlement.

In an interview, Mundy said the fen-phen affair was a "blueprint"
illustrating weaknesses in the drug approval system. "It bothered me not
only that the company made such calculated decisions, but [also] that the
FDA let this happen in spite of the fact that so many FDA people were
really worried about these drugs."

"It's not me accusing the company," she said, "it's their documents,
their own depositions, it's five juries, four of which returned
incredible verdicts [for the plaintiffs]. . . . And of course, [Wyeth]
wouldn't be owing $ 12 billion" under the settlement, she says, if the
facts were not solid. (The Washington Post, May 01, 2001)


HOLOCAUST VICTIMS: Generali Fund to Distribute Compensation
-----------------------------------------------------------
Holocaust survivors from Eastern Europe and their descendants awaiting
payment of never-processed life insurance policies awarded by the Italian
insurer Assicurzaioni Generali during World War II has come one step
closer to receiving compensation with the signing of a deal that will
help facilitate the processing of claims.

Under the agreement, the International Commission of Holocaust-era
Insurance Claims (ICHEIC) has selected the Israeli-based Generali Fund in
Memory of the Generali Insured in East and Central Europe to be the
distributor of $ 100 million allocated last November by Generali for
payments to policy holders and their descendants.

The Generali Fund, which has already overseen the distribution of roughly
$ 8 million out of an initial $ 12 million provided by Generali, will be
responsible for the evaluation of all claims and the distribution of
money.

The deal was inked in Washington by ICHEIC chairman Lawrence Eagleburger,
a former secretary of state, and Generali Fund chairman Dov Levin, a
retired Supreme Court justice.

After payments are made to all eligible policy holders, any remaining sum
will be distributed on a humanitarian basis to Holocaust survivors by
Jewish organizations, Levin said.

The Generali Fund competed with other groups outside Israel for the
rights to distribute the money.

Meir Lantzman, director-general of the fund, which was established
jointly by MKs and Generali in 1997, said so far roughly 60,000 claims
have been received and will be evaluated in the coming weeks.

He estimated that claimants could begin receiving checks within 90 days.

The fund is working with Yad Vashem in Jerusalem, which has an extensive
computerized list of Holocaust victims, to expedite the processing of
claims.

In early 1998, Generali, pressured by Israel, transferred some 337,000
names of pre-war policy holders to Yad Vashem.

"We are looking forward to this relationship between the Generali Fund in
Jerusalem, Generali in Trieste, and ICHEIC in Washington.

"I believe that relationship will ultimately benefit the claimants," said
Neal Sher, ICHEIC chief of staff.

Generali originally offered the $ 100 million sum in 1998 to settle a
class-action suit brought by thousands of Jews whose insurance policy
claims were denied by the insurer after World War II. (The Jerusalem
Post, May 1, 2001)


HOOTERS RESTAURANT: Appeals $11.9 Mil Judgment For Sending Junk Faxes
---------------------------------------------------------------------
The Hooters restaurant chain has appealed a judge's order that it pay
$11.9 million for sending unwanted advertisements by fax.

The Atlanta-based company has filed with the Georgia Court of Appeals in
answer to Superior Court Judge Carl C. Brown's ruling, which would give
each member in a 1,321-person class-action lawsuit slightly more than
$6,000.

Under Brown's order, local attorney Sam Nicholson would receive $ 15,000
for initiating the case, and the plaintiffs' lawyers would make almost $4
million.

"We're not surprised by the judge's ruling, and we're still very
confident we'll win on appeal," said Mike McNeil, vice president of
marketing for Hooters of America. "The judge's interpretation of willful
intent, based on his instructions to the jury, would lead you to believe
he would come to that conclusion."

After hearing that each class member received six faxes, which
prominently featured lunch coupons for Hooters, a jury ruled March 21
that Hooters "willfully or knowingly" faxed unsolicited advertisements.

The now-defunct Value-Fax of Augusta sent the ads on behalf of the local
Hooters in 1995. The restaurant is a subsidiary of Hooters of America
Inc., which is ultimately responsible for any liabilities. Value-Fax's
owner, Bambi Clark, has been unreachable and did not appear in court.

The Telephone Consumer Protection Act of 1991 requires advertisers to get
prior consent before transmitting or pay a minimum of $500 per violation.
The fine can be as much as tripled when the law is flagrantly violated.

Mark Wilby, the lead attorney for Hooters, said he felt the judge's
obligation to increase the amount under the federal law was discretionary
rather than compulsory. But the judge used the word "must" in his
decision.

Harry Revell, the lead plaintiff attorney, said the ruling should stand.

"We are very grateful and pleased with both the jury verdict and the
decision the judge has entered, and we think it is supported by the
evidence." Revell said.

Out of the $11.9 million common fund, the court awarded 33 percent - or
slightly more than $3.9 million - in attorneys fees to Revell's firm.

In an April 17 hearing, Beth McCloud, who assisted Wilby, said Revell's
firm would receive more than its standard billing rate even if the judge
awarded the minimum damages allowed under law.

The judge said the case was the first junk faxes lawsuit in the country
to be heard as a class action. (The Associated Press State & Local Wire,
May 1, 2001)


INMATES LITIGATION: Rights Advocates Accuse CA of Ignoring Needs re AIDS
------------------------------------------------------------------------
Prisoners' rights advocates are accusing California of systematically
ignoring the medical needs of the state's 160,000 prisoners, including
those with HIV/AIDS, in a suit billed as the largest class action ever
filed concerning prison conditions.

The case was filed in early April in a San Francisco federal court. It
contends the state delays or fails to perform necessary medical tests, or
to act on the test results. It also claims the state delays or bars
treatment by outside doctors or specialists, and ignores the orders of
inmates' physicians.

The lawsuit also questions the system's reliance on medical technical
assistants - nurses trained as corrections officers - to make initial
decisions about whether inmates need treatment.

In the suit, nine inmates claim the prison health care system suffers
from poor training, staff shortages, delays in access to doctors and
tests, interference by corrections officers and defective care for
HIV-positive prisoners. Overall, the inmates say prison health care is so
inadequate it violates the constitutional ban on cruel and unusual
punishment.

The nine inmates named as plaintiffs in the lawsuit include Raymond
Stoderd, a prisoner at California State Prison at Corcoran, who has
advanced AIDS. He says his pain medication was cut off eight times,
causing severe withdrawal symptoms.

An inmate at Salinas Valley State Prison, Joseph Long, a paraplegic who
says he suffers from frequent bladder infections, alleges that the system
has delayed his treatment by an outside urologist for seven months.

The suit represents all 160,000 inmates within the California prison
system. It seeks a statewide injunction requiring improvements in the
system and damages for the nine plaintiffs.

"When inmates are denied the medical care they need, it can amount to a
death sentence," attorney Donald Specter of the Prison Law Office told
the San Francisco Examiner.

The Prison Law Office is a nonprofit group that advocates for the rights
of California prisoners. Its offices are outside the gates of San
Quentin. (AIDS Policy and Law, April 27, 2001)


INVESTMENT FIRMS: Accused of Collusion and Fraud in IPO Manipulation
--------------------------------------------------------------------
Two proposed class actions have accused major Wall Street investment
firms of collusion and securities fraud in their stock price manipulation
of large IPOs including United Parcel Service (NYSE: UPS) and
priceline.com (NASDAQ: PCLN). The underwriters allegedly required
investors to kick back up to one-third of the IPO profits in order to
gain access to the hot offering, along with other conditions. Billing v.
Credit Suisse First Boston Corp. et al., No. 01-2014, complaint filed
(S.D.N.Y., Mar. 9, 2001); Hirsch v. Priceline.com Inc. et al., No.
01-2261, complaint filed (S.D.N.Y., Mar. 16, 2001).

According to Howard Sirota of Sirota & Sirota, "Some institutional
investors were even in on the scheme and profited from it, while other
institutional investors were unaware of it and paid inflated prices for
their stock." He expects to file a suit in the near future naming those
institutional investors that were allegedly involved.

The antitrust suit names Credit Suisse First Boston Corp., Goldman Sachs
& Co., Lehman Brothers Inc., Morgan Stanley Dean Witter & Co., BancBoston
Robertson Stephens Inc., Salomon Smith Barney Inc. and Merrill Lynch,
Pierce Fenner & Smith Inc. Credit Suisse, Goldman Sachs and Lehman
Brothers are not named in the securities fraud suit.

                     The Antitrust Suit

Starting as early as March 1997, the investment companies agreed to jack
up their fees by charging excessive commissions for underwriting or
selling the initial public offering, the investors say. In addition to
cutting into a client's profits, the defendants allegedly told purchasers
they had to buy more shares of the stock at a later date if they wanted
to get in on the new offering.

The practice of making clients purchase additional stock shares at
specified times after the initial offering once the stock price increases
is referred to as a "tie-in purchase." It is designed to continuously
escalate the overall stock price and is known as "laddering stock" in the
industry.

The proposed class of investors contends that the firms increased their
profits by hundreds of millions and that the conditions were imposed on
buyers across the country, although the practice centered in New York
City. According to the complaint, employees who moved from one firm to
another have confirmed that the IPO allocation procedures were the same
among the underwriters and sellers.

Through these purchase requirements, the named firms allegedly
manipulated the price of the stock and increased their own revenues in
violation of the antitrust laws contained in the Clayton Act and the
Sherman Act.

The proposed class period runs from March 10, 1997, to Dec. 1, 2000. The
other IPOs named in the antitrust suit are Marimba Inc. (NASDAQ: MRBA)
and Ariba Inc. (NASDAQ: ARBA).

                 The Securities Fraud Action

The securities fraud suit accuses Priceline.com, its officers and
directors, and four investment firms of requiring kickbacks and tie-in
purchases for its hot offering.

On March 30, 1999, Priceline shares opened to the public at $81 each, an
increase of 506 percent, and rose to an inter-day high of $85 before
closing at $69.

"Unbeknownst to investors who purchased in the after -market, the
increase in share price was a result, in part, of the tie-in arrangements
which locked in demand for Priceline shares at levels well above the
offering price and the price at which Priceline securities would have
traded were it not for the aforementioned arrangements," the investors
say.

According to published reports, the Securities and Exchange Commission
and the U.S. attorney's office began investigating the allegations in
December of last year.

The officers and directors named as defendants in the suit are Chairman
and CEO Richard S. Braddock, Vice Chairman and founder Jay S. Walker, and
CFO/director Paul E. Francis.

Also representing the investors in both suits are Saul Roffe of Sirota &
Sirota and Christopher Lovell of Lovell & Stewart in New York. Lovell won
the suit that charged Wall Street firms with price-fixing NASDAQ stocks.
That case settled for more than $1 billion in 1998. (Antitrust Litigation
Reporter, April 2001)


TRW INC: Agrees To Pay Higher Lump-Sum Payments To Retirees
-----------------------------------------------------------
TRW Inc. has agreed to pay $48.5 million to settle a lawsuit on behalf of
about 5,500 retirees over lump-sum pension payments.

Attorneys for the retirees and the company, based in suburban Lyndhurst,
planned to present the settlement to U.S. District Judge Ann Aldrich,
said Robert Gary, a lawyer representing the retirees.

He said the retirees in the class-action case chose a single payment over
monthly lifetime checks. Gary said the dispute involved the way TRW
calculated the lump-sum payments.

About four years ago, Aldrich had ordered TRW to recalculate 10 years of
lump-sum payments to the retirees. TRW appealed, but last December the
ruling was affirmed.

TRW continues to believe that it calculated the pensions properly, said
spokesman Michael Jablonski.

"We believe it is in the best interests of the company and of the TRW
retirees to bring the litigation to a conclusion by entering into a
settlement agreement," the company said in a written statement.

The case involved TRW workers who retired between Oct. 23, 1986, and July
1, 1996. Most of the retirees worked in TRW's West Coast operations. (The
Associated Press State & Local Wire, May 1, 2001)


U.S. AGGREGATES: Milberg Weiss Files Securities Suit in CA
----------------------------------------------------------
Milberg Weiss (http://www.milberg.com/usagg/)announced on May 1 that a
class action has been commenced in the United States District Court for
the Northern District of California on behalf of purchasers of U.S.
Aggregates, Inc. (NYSE:AGA) publicly traded securities during the period
between April 25, 2000 and April 2, 2001 (the "Class Period").

The complaint charges U.S. Aggregates and certain of its officers and
directors with violations of the Securities Exchange Act of 1934. U.S.
Aggregates is a producer of aggregates, which consist of crushed stone,
sand and gravel, and constitute a basic construction material.
Approximately two-thirds of the Company's products are used for the
construction and maintenance of highways and other infrastructure
projects.

On April 3, 2001, U.S. Aggregates issued a press release entitled, "U.S.
Aggregates, Inc. Reports Preliminary Fourth Quarter and Full Year 2000
Results; Restates Earnings for First Three Quarters of 2000; Reaches
Interim Agreement With Senior Secured Lenders; Delays Filing Form 10-K
for 2000; Sells Certain Construction Materials Operations in Utah," which
stated in part, "The Company will restate its earnings for the first
three quarters of 2000. For the first quarter, the Company will restate
its net loss of $2.6 million, or $0.17 per diluted share, to a net loss
of $5.1 million, or $0.34 per diluted share. For the second quarter, the
Company will restate its net income of $6.8 million, or $0.45 per diluted
share, to net income of $3.1 million, or $0.20 per diluted share. For the
third quarter, the Company will restate its net income of $5.5 million,
or $0.36 per diluted share, to net income of $1.7 million, or $0.11 per
diluted share. The restatement relates primarily to the reclassification
of certain capitalized items to operating expenses, the recognition of
certain additional operating expenses, and the establishment of a reserve
for self- insurance claims."

On this news, U.S. Aggregates shares dropped to $4.30, or more than 79%
lower than the Class Period high of $20-1/4.

Contact: Milberg Weiss Bershad Hynes & Lerach LLP William Lerach,
800/449-4900 wsl@mwbhl.com


                             *********


S U B S C R I P T I O N  I N F O R M A T I O N

Class Action Reporter is a daily newsletter, co-published by Bankruptcy
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Copyright 1999.  All rights reserved.  ISSN 1525-2272.

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