/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/010605.mbx C L A S S A C T I O N R E P O R T E R Tuesday, June 5 2001, Vol. 3, No. 109 Headlines ALLSTATE CORPORATION: Worker Classification Suit Remains Unresolved ARIBA INC.: Securities Suits In Process Of Being Consolidated AURORA FOODS: Settles Securities And Derivative Suits In N.D. CA AZURIX CORPORATION: $2.25M Settlement Deal Awaits Court Approval BLOCKBUSTER INC.: Settlement Fairness Hearing Set For December BUY.COM: Settles Lawsuit In California For $575,000 BUY.COM: Classes Not Yet Certified In Three California Lawsuits COMPUCREDITS CORPORATION: CFO Added Defendant In Securities Lawsuit CORRECTIONS CORPORATION: Releases 16M Shares To Plaintiffs CRITICAL PATH: Several Securities Suits Filed In N.D. California CUMULUS MEDIA:Files Motion To Dismiss 2nd Amended Plaint In Wisconsin DRKOOP.COM: Consolidated Amended Complaint In W.D. Texas "Meritless" FORD MOTOR: Lawyers Ask Indianapolis Judge To Force Explorer Recall GAYLORD CHEMICAL: Settles 1995 Tank Explosion For Unspecified Amount HEALTHCARE RECOVERIES: Two Motions On Conte Lawsuit Remain Undecided INSURANCE MANAGEMENT: Files Motion To Dismiss Lawsuit In M.D. Florida LENDINGTREE INC.: Motion For Summary Judgement Planned For CA Suit LIFEPOINT HOSPITALS: Works Toward Compliance With ADA, Access Now MARIMBA INC.: Wolf Haldenstein Files Securities Suit In S.D. New York METLIFE INC.: Fairness Hearing On Settlement Deal Set For September METLIFE INC.: Racial Discrimination Suit Goes To Trial This November MUSICMAKER.COM: Court Has Yet To Rule On Motion To Dismiss CA Suit NEFF CORPORATION: Negotiations With United Rentals Terminated NETZERO INC.: 1999 IPO Fosters Several Securities Suits NEW VALLEY: Discovery On Shareholders Suit In Delaware Has Begun PARK PLACE: Mohawk Tribal Court Hands Down $1.8 Billion Judgement PARK PLACE:Plaintiffs Appeal Case Dismissal To Delaware Supreme Court PINNACLE HOLDINGS: Faces Securities Suit Filed In M.D. Florida PRICELINE.COM: Three Securities Lawsuits Filed In S.D. New York RAVISENT TECHNOLOGIES: Awaits Hearing Date For Motion To Dismiss SAGENT TECHNOLOGY: Plaintiffs File Consolidated Securities Suit SOTHEBY'S HOLDINGS: Discovery On Six Lawsuits Stayed Until October 8 SPECTRUM BANCORPORATION: Opposes Move To Remand Case To Iowa Court USSEARCH.COM: Settles Damages Suit In CA, Awaits Court Approval WILLIAMS COMPANIES: Petitions Panel To Consolidate Cases ********* ALLSTATE CORPORATION: Worker Classification Suit Remains Unresolved ------------------------------------------------------------------- Allstate is or has been defending various lawsuits involving worker classification issues. Examples of these lawsuits include two class actions, filed after Allstate's reorganization of its California agent programs in 1996 relating to the classification of California exclusive agents as independent contractors. The plaintiffs in these two class actions sought a determination that they had been treated as employees notwithstanding agent contracts that specify that they are independent contractors for all purposes. In both of these class actions, the court determined that the agents are independent contractors. The court's determination led to the dismissal of one suit and settlement of the other suit for a non- material amount. This settlement has received final approval. A class action relating to the worker classification of staff working in agencies is ongoing. In this putative class action, plaintiffs seek damages under the Employee Retirement Income Security Act and Racketeer Influenced and Corrupt Organizations Act alleging that 10,000 agency secretaries were terminated as employees by Allstate and rehired by agencies through outside staffing vendors for the purpose of avoiding the payment of employee benefits. Allstate has been vigorously defending these lawsuits and various other worker classification lawsuits. With the exception of the case that has been settled, the outcome of these disputes is currently uncertain. ARIBA INC.: Securities Suits In Process Of Being Consolidated ------------------------------------------------------------- Between March 20, 2001 and April 5, 2001, several securities class action complaints were filed against Ariba, Inc. and several of its current and former officers and directors in the United States District Court for the Southern District of New York. The complaints allege the Company's lead underwriters, Ariba and the other named defendants violated federal securities laws by making material false and misleading statements in a prospectus incorporated in the Company's registration statement on Form S-1 filed with the SEC in June 1999. The complaints are generally related to the alleged receipt of excessive and undisclosed commissions by the underwriters in connection with the allocation of shares of common stock in the Company's initial public offering. The complaints are currently in the process of being consolidated into a single action. AURORA FOODS: Settles Securities And Derivative Suits In N.D. CA ---------------------------------------------------------------- Last year, Aurora Foods, Inc. was served with eighteen complaints in purported class action lawsuits filed in the U.S. District Court for the Northern District of California. The complaints alleged, among other things, that as a result of accounting irregularities, the Company's previously issued financial statements were materially false and misleading and thus constituted violations of federal securities laws by the Company and the directors and officers who resigned on February 17, 2000 (Ian R. Wilson, James B. Ardrey, Ray Chung and M. Laurie Cummings). The actions alleged that the defendants violated Sections 10(b) and/or Section 20(a) of the Securities Exchange Act and Rule 10b-5 promulgated thereunder. On April 14, 2000, certain of the Company's current and former directors were named as defendants in a derivative lawsuit filed in the Superior Court of the State of California, in the County of San Francisco, alleging breach of fiduciary duty, mismanagement and related causes of action based upon the Company's restatement of its financial statements. The case was then removed to federal court in San Francisco. On January 16, 2001 the Company announced that it reached a preliminary agreement to settle the securities class action and derivative lawsuits pending against the Company and its former management team in the U.S. District Court in the Northern District of California. On March 1, 2001, Stipulations of Settlement for the Securities class action and derivative lawsuits were entered into in the U.S. District Court in the Northern District of California to fully resolve, discharge and settle the claims made in each respective lawsuit. On May 11, 2001, the United States District Court for the Northern District of California approved the settlement. AZURIX CORPORATION: $2.25M Settlement Deal Awaits Court Approval ---------------------------------------------------------------- On October 27, 2000, a lawsuit was filed in the Court of Chancery in the State of Delaware, New Castle County, by Thomas Turberg against Azurix Corp., Enron Corp. and certain of their officers and directors. The suit is a purported class action filed on behalf of Azurix's public shareholders for the purpose of enjoining a transaction proposed by Enron for taking Azurix private at a price of $7.00 for each of Azurix's publicly held shares. The suit generally alleged that the buy-out price of $7.00 per share was unconscionable and unfair and grossly inadequate and that the defendants have breached their duties of loyalty and care with respect to Azurix's public shareholders. Six similar actions were subsequently filed in the Court of Chancery in the State of Delaware, New Castle County and all Delaware actions have been consolidated into a single action. On December 13, 2000, the parties to the litigation executed a Memorandum of Understanding that settled both the Delaware and Texas actions in principle. Under the proposed settlement, the defendants acknowledged that the prosecution of the litigation was a material factor in causing Enron to increase the merger consideration from $7.00 to $8.375 per share. The proposed settlement provides that the defendants will not oppose plaintiffs' application for attorneys' fees and expenses up to $2.25 million, which Enron has agreed to pay. The proposed settlement is subject to the execution of definitive settlement documents, confirmatory discovery, and court approval. BLOCKBUSTER INC.: Settlement Fairness Hearing Set For December -------------------------------------------------------------- Blockbuster Inc. is a defendant in 19 putative class action lawsuits filed by customers in state courts in Illinois, California, Ohio, Maryland, Texas, New York, Tennessee, Delaware, Massachusetts, Washington, D.C., and Pennsylvania between February 1999 and April 2001. These cases allege common law and statutory claims for fraud and/or deceptive practices and/or unlawful business practices regarding Blockbuster's policies for customers who choose to keep rental product beyond the initial rental term. Some of the cases also allege that these policies impose unlawful penalties and/or result in unjust enrichment. Blockbuster reached a preliminary settlement in two of the Texas cases and on April 11, 2001, a Texas state court preliminarily approved the parties' proposed settlement agreement, which provides for a national settlement class and does not admit liability. Under the proposed settlement, Blockbuster would make certificates available to class members for rentals and discounts and would pay up to a specified amount in attorneys' fees in connection with the settlement. Confirmation of a settlement is subject to a fairness hearing, currently scheduled for December 10, 2001, and a final court order. On April 25, 2001, an Illinois state court entered a provisional order, subject to further review and final determination, certifying plaintiff and defendant classes in order that putative class counsel in Illinois would have an opportunity to be heard regarding the national class settlement. BUY.COM: Settles Lawsuit In California For $575,000 --------------------------------------------------- Buy.com, Inc. disclosed in a recent regulatory filing with the Securities and Exchange Commission that it has already settled a case pending in the Orange County, California Superior Court. The settlement cost the company $575,000, which was paid by the Company's insurance carrier. The court handed the final approval on December 15, 2000, the regulatory document disclosed. The case, which was filed in March 1999, had accused the Company of breach of contract, fraud and violation of consumer protection laws based on an error in the pricing of a computer monitor that was offered for sale on its Web site. A similar class action case is also pending in Camden County, New Jersey. Plaintiffs also claimed that the Company attempted the same scheme with other products. The New Jersey case has been dismissed and may only be reinstated if final court approval is not given by the Orange County Superior Court. BUY.COM: Classes Not Yet Certified In Three California Lawsuits --------------------------------------------------------------- Buy.com, Inc. revealed in a recent SEC regulatory filing that classes have yet to be certified in the three class action suits pending in California. On March 13, 2000 the first of the three class actions was filed against the Company in the U.S. District Court for the Central District of California alleging that the Company collect, use and disclose personally identifiable customer information to its third party advertising server and other advertisers without first informing its customers or seeking their permission in violation of several federal statutes. The complaint seeks damages of up to $10,000 per class member per violation, actual and punitive damages, restitution, attorneys' fees and costs plus injunctive and other equitable relief. On April 7, 2000 a companion lawsuit was filed in the Superior Court of the State of California, County of Orange. The complaint seeks statutory damages of up to $5,000 per class member per violation. On April 25, 2000 a third class action suit was filed in the United States District Court for the Central District of California. COMPUCREDITS CORPORATION: CFO Added Defendant In Securities Lawsuit ------------------------------------------------------------------- In November 2000, CompuCredit Corporation and David Hanna, Chief Executive Officer, were named defendants in a series of purported class action lawsuits filed in the Federal District Court for the Northern District of Georgia. These lawsuits arise from the decline in the market value of the Company's common stock on October 25, 2000, and allege that prior to that date CompuCredit and Hanna made false and misleading statements in violation of Federal securities laws. On May 7, 2001, Brett Samsky, the Company's Chief Financial Officer from its inception in 1996 until January 2001, was added as a defendant. In general, the lawsuits seek compensatory monetary damages and legal fees. CORRECTIONS CORPORATION: Releases 16M Shares To Plaintiffs ---------------------------------------------------------- During the first quarter of 2001, Corrections Corporation of America obtained final court approval of the settlements of the following outstanding consolidated federal and state class action and derivative stockholder lawsuits brought against the Company and certain of its former directors and executive officers: (i) In re: Prison Realty Securities Litigation; (ii) In re: Old CCA Securities Litigation; (iii) John Neiger, on behalf of himself and all others similarly situated v. Doctor Crants, Robert Crants and Prison Realty Trust, Inc.; (iv) Dasburg, S.A., on behalf of itself and all others similarly situated v. Corrections Corporation of America, Doctor R. Crants, Thomas W. Beasley, Charles A. Blanchette, and David L. Myers; (v) Wanstrath v. Crants, et al.; and (vi) Bernstein v. Prison Realty Trust, Inc. Pursuant to the terms of the settlements, the Company will issue or pay to the plaintiffs (and their respective legal counsel) in the actions: (i) an aggregate of 46.9 million shares of the Company's common stock; (ii) a subordinated promissory note in the aggregate principal amount of $29.0 million; and (iii) approximately $47.5 million in cash payable solely from the proceeds of certain insurance policies. As of March 31, 2001, the Company had issued 8.4 million shares under terms of the settlement to plaintiffs' counsel in the actions. Subsequent to March 31, 2001, the Company issued an additional 7.5 million shares under terms of the settlement to plaintiffs' counsel in the actions. The remaining shares are expected to be issued during 2001. CRITICAL PATH: Several Securities Suits Filed In N.D. California ---------------------------------------------------------------- Beginning on February 2, 2001, a number of securities class action complaints were filed against Critical Path, Inc., certain of its current and former officers and directors and its independent accountants, in the United States District Court for the Northern District of California. Individuals who allege that they purchased the Company's Common Stock during a purported class period have filed the complaints as purported class actions. The alleged class periods vary among the complaints and are in the process of being consolidated into a single action. The complaints generally allege that, in differing periods from December 1999 to February 1, 2001, the Company and other named defendants made false or misleading statements of material fact about the Company's financial statements, including its revenues, revenue recognition policies, business operations and prospects for the year 2000 and beyond. The complaints seek an unspecified amount in damages on behalf of persons who purchased the Company's Common Stock during certain periods. CUMULUS MEDIA:Files Motion To Dismiss 2nd Amended Plaint In Wisconsin ---------------------------------------------------------------------- Cumulus Media Inc. had been named as a defendant in the following eleven class action complaints: (1) Wolfe v. Weening, et al.; (2) Klar v. Cumulus Media Inc., et al.; (3) Atlas v. Cumulus Media Inc., et al.; (4) Steinberg and Steinberg v. Cumulus Media Inc., et al.; (5) Wong v. Weening, et al.; (6) Pleatman v. Cumulus Media Inc., et al.; (7) Kincer v. Weening, et al.; (8) Krim v. Cumulus Media Inc., et al.; (9) Baldwin v. Cumulus Media, Inc., et al.; (10) Pabian v. Weening, et al.; and (11) Demers v. Cumulus Media Inc., et al. Certain present and former directors and officers of the Company, and certain underwriters of the Company's stock, have also been named as defendants. The complaints have all been filed in the United States District Court for the Eastern District of Wisconsin. They were filed as class actions on behalf of persons who purchased or acquired Cumulus Media common stock during various time periods between May 11, 1999 and April 24, 2000. On August 4, 2000, the eleven actions were consolidated into a single action, also pending in the United States District Court for the Eastern District of Wisconsin. On December 8, 2000, plaintiffs served a Second Amended Consolidated Class Action Complaint, which alleges, among other things, violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and Sections 11 and 12(a) of the Securities Act of 1933, and seeks unspecified damages. On February 8, 2001, the Company served its motion to dismiss the second amended complaint. Although the Company has certain defenses it intends to vigorously assert in these proceedings, the Company cannot predict how the plaintiffs' claims will ultimately be resolved. DRKOOP.COM: Consolidated Amended Complaint In W.D. Texas "Meritless" -------------------------------------------------------------------- Drkoop.com, Inc. and certain of its prior officers and prior and current directors are defendants in a consolidated class action lawsuit in the United States District Court for the Western District of Texas captioned In re drkoop.com, Inc. Securities Litigation. The Consolidated Action consolidates at least eleven substantially identical class action lawsuits, the first of which was filed on July 14, 2000. The Consolidated Action, which is maintained on behalf of purchasers of the securities of drkoop.com, Inc., alleges violations of the federal securities laws. On or about January 11, 2001, the lead plaintiffs filed a Consolidated Amended Complaint. The Company's time to respond to the Consolidated Amended Complaint has not yet expired. "We believe that the claims alleged in the Consolidated Action are without merit and intend to defend (against) the Consolidated Action vigorously," the Company noted in a recent regulatory filing with SEC. FORD MOTOR: Lawyers Ask Indianapolis Judge To Force Explorer Recall ------------------------------------------------------------------- Lawyers suing Ford Motor Co. and Bridgestone Corp.'s Firestone unit have asked a federal judge in Indianapolis last week to require that Ford recall its Explorer sport utility vehicles, the Reuters News Agency reported. A motion was filed, Friday, claiming that the 1991 to 2001 Explorer models are ``inherently unsafe'' and ``present a continuing danger to their owners, their occupants and to the American motoring public,'' the news agency said. Accordingly, there is no engineering solution to the defects in the Explorer models; hence, Ford should be required to give owners a refund or a new truck. The carmaker calls the motion ``frivolous,'' noting that it included no data that would justify such an action, Ford spokesman Ken Zino said. More than 300 personal-injury and class action lawsuits against Ford and Firestone have been consolidated in Indianapolis for pretrial purposes, Reuters said. The plaintiffs' lawyers have already asked U.S. District Court Judge Sarah Evans Barker, chief judge of the Indianapolis federal court, to supervise Ford's tire recall. She has ordered Ford and Firestone to respond to that motion by Tuesday, Reuters said. GAYLORD CHEMICAL: Settles 1995 Tank Explosion For Unspecified Amount -------------------------------------------------------------------- On May 4, 2001, Gaylord Container Corporation and Gaylord Chemical Corporation agreed in principle to settle all claims arising out of the rail tank car explosion in 1995 on the premises of the Bogalusa, Louisiana plant of Gaylord Chemical Corporation. Gaylord Chemical Corporation disclosed this information in a recent SEC filing. According to the regulatory document, neither the Company nor Gaylord Chemical Corporation contributed to the settlement, the terms of which remain confidential. The settlement is subject to court approval. On October 23, 1995, a rail tank car exploded on the premises of the Gaylord Chemical Corporation, a wholly owned, independently operated subsidiary of the Company. The accident resulted in the venting of certain chemicals, including by-products of nitrogen tetroxide, a raw material used by the plant to produce dimethyl sulfoxide, a solvent used in the manufacture of pharmaceutical and agricultural chemicals. More than 160 lawsuits have been filed in both federal and state courts naming as defendants Gaylord Chemical Corporation and/or the Company, certain of their respective officers and other unrelated corporations and individuals. The lawsuits, which seek unspecified damages, allege personal injury, property damage, economic loss, related injuries and fear of injuries as a result of the accident. HEALTHCARE RECOVERIES: Two Motions On Conte Lawsuit Remain Undecided -------------------------------------------------------------------- Two motions in relation to the Conte v. Healthcare Recoveries, Inc., No. 99-10062 are still pending, this according to a recent regulatory filing of Healthcare Recoveries, Inc. with the Securities and Exchange Commission. One motion was filed in November 1999 yet, which sought the dismissal of the amended complaint file against the company. The other motion is an opposition to a class certification filed in May 2000. On October 1, 1999, a first amended class action complaint was filed against the Company in the United States District Court for the Southern District of Florida, in a putative class action brought by William Conte and Aaron Gideon, individually and on behalf of all others similarly situated. In that action, plaintiffs assert that HCRI's subrogation recovery efforts on behalf of its clients violate a number of state and federal laws, including the Fair Debt Collection Practices Act and the Florida Consumer Collection Practices Act. Plaintiffs purport to represent a class consisting of all participants or beneficiaries of ERISA plans nationwide whose net recovery of damages through judgments, settlements or otherwise against liable third parties has been reduced or potentially reduced by HCRI's alleged assertion and/or recovery of unlawful subrogation/reimbursement rights of its clients. INSURANCE MANAGEMENT: Files Motion To Dismiss Lawsuit In M.D. Florida --------------------------------------------------------------------- On September 28, 2000, October 25, 2000 and October 30, 2000, three alleged shareholders of Insurance Management Solutions Group, Inc. filed three nearly identical lawsuits in the United States District Court for the Middle District of Florida, each on behalf of a putative class of all persons who purchased shares of the Company's Common Stock pursuant and/or traceable to the registration statement for the Company's February 1999 initial public offering. The lawsuits were consolidated on December 1, 2000, and the consolidated action is proceeding under Case No. 8:00-CV-2013-T-26MAP. The plaintiffs' Consolidated Amended Class Action Complaint, filed February 7, 2001, names as defendants the following parties: (i) Insurance Management Solutions Group, Inc.; (ii) Bankers Insurance Group, Inc., the Company's principal shareholder; (iii) Venture Capital Corporation, a selling shareholder in the IPO; the five inside directors of the Company at the time of the IPO; and (iv) Raymond James & Associates, Inc. and Keefe, Bruyette & Woods, Inc., the underwriters for the IPO. The complaint alleges, among other things, that the defendants violated Sections 11, 12(a) (2) and 15 of the Securities Act of 1933, as amended. On March 26, 2001, the Company, BIG and the five inside director defendants filed a motion to dismiss the plaintiffs' Consolidated Amended Class Action Complaint for, among other things, failure to allege material misstatements and/or omissions in the registration statement and/or prospectus relating to the IPO. LENDINGTREE INC.: Motion For Summary Judgement Planned For CA Suit ------------------------------------------------------------------ LendingTree, Inc. disclosed in a recent regulatory filing with SEC that the case pending against the Company in relation to HomeSpace Services, Inc. has not made any significant progress so far, except for a limited discovery with which the Company is presently complying. The case is pending in California Superior Court in Contra Costa, California. Aside from the Company, the suit also named, as defendants, Ohio Savings Bank, Costco Wholesale Corp., Costco Financial Services Inc., First American Title Insurance Company and First American Lenders Advantage. This case challenges the legality of the payment of premium spreads to HomeSpace Services, Inc. through an affinity lending program with co- defendants Costco Wholesale and Ohio Savings Bank. The Company acquired certain assets (principally a nationwide network of real estate agents) and assumed certain liabilities of HomeSpace Services, Inc. in August last year. "We intend to file a motion for summary judgment in the case on the grounds that we are not liable for the actions of HomeSpace by virtue of our purchase of certain of its assets," the Company said in a regulatory document. LIFEPOINT HOSPITALS: Works Toward Compliance With ADA, Access Now ----------------------------------------------------------------- On January 12, 2001, Access Now, Inc., a disability rights organization, filed a class action lawsuit against each of the Company's hospitals alleging non-compliance with the accessibility guidelines under the Americans with Disabilities Act. The lawsuit, filed in the United States District Court for the Eastern District of Tennessee, seeks injunctive relief requiring facility modification, where necessary, to meet the ADA guidelines, along with attorneys fees and costs. "We are working with Access Now to determine the scope of facility modification needed to comply with the Act," said the Company in a recent regulatory filing with the Securities and Exchange Commission. MARIMBA INC.: Wolf Haldenstein Files Securities Suit In S.D. New York --------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP commenced a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all purchasers of Marimba, Inc. (NASDAQ: MRBA- -news) securities pursuant or traceable to a false and misleading prospectus between April 30, 1999 and March 27, 2000, inclusive. Aside from Marimba, the following were also named as defendants in the suit: (i) Kim K. Polese (President, Chief Executive Officer and a director of Marimba), (ii) Fred M. Gerson (Vice President and Chief Financial Officer), (iii) Arthur A. Van Hoff (Chief Technology Officer and a director of Marimba), Morgan Stanley & Co. Inc.(co-lead underwriter of the Company's IPO), (iv) Credit Suisse First Boston Corporation (co-lead underwriter of the Company's IPO), and (v) Bear Stearns & Co., Inc. (a member of the Offering underwriter group). The complaint alleges that defendants violated Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. For more details, contact: Wolf Haldenstein Adler Freeman & Herz LLP at 270 Madison Avenue, New York, New York 10016, by telephone at (800) 575-0735 (Michael Miske, George Peters, Gregory M. Nespole, Esq., or Fred Taylor Isquith, Esq.), via e-mail at classmember@whafh.com or visit the firm's website at www.whafh.com. All e-mail correspondence should make reference to Marimba. METLIFE INC.: Fairness Hearing On Settlement Deal Set For September ------------------------------------------------------------------- A certified class action with conditionally certified subclasses is pending in the United States District Court for the Southern District of New York against various individual defendants and the following subsidiaries of MetLife, Inc. for improper sales abroad: (i) Metropolitan Life Insurance Company, (ii) Metropolitan Insurance and Annuity Company, and (iii) Metropolitan Tower Life Insurance Company The District Court has recently preliminarily approved a proposed settlement agreement. A fairness hearing has been scheduled for September 25, 2001. METLIFE INC.: Racial Discrimination Suit Goes To Trial This November -------------------------------------------------------------------- The consolidated racial discrimination suit filed against Metropolitan Life Insurance Company, a subsidiary of MetLife, Inc., will go to trial on November. This is the latest information on the case, which was included in a regulatory document filed recently by the Company with the Securities and Exchange Commission. This case, which was originally filed separately in New York, Louisiana and Kansas, accuses Metropolitan Life of racial discrimination in the marketing, sale, and administration of life insurance policies, including "industrial" life insurance policies, sold decades ago by the insurance subsidiary. The consolidated case is now pending in the U.S. District Court for the Southern District of New York. Metropolitan Life has moved for summary judgment citing the applicable statute of limitations. A class certification motion is pending. On March 26, 2001, a similar purported class action lawsuit was filed against Metropolitan Life in the United States District Court for the Southern District of Illinois. Metropolitan Life intends to move to transfer the lawsuit to the United States District Court for the Southern District of New York. MUSICMAKER.COM: Court Has Yet To Rule On Motion To Dismiss CA Suit ------------------------------------------------------------------ On or about February 25, 2000, certain current or former stockholders of Musicmaker.com, Inc. commenced a securities class action lawsuit in the United States District Court for the Central District of California against Musicmaker and certain of its directors and officers. Five nearly identical, additional actions were subsequently filed in the Central District of California. On June 5, 2000 the Court ordered that the six original Actions be consolidated into one case, and on June 14, 2000 four lead plaintiffs and lead counsel were appointed to manage the Actions. The Class Action Complaint is a class action complaint, which purports to be brought on behalf of all public investors who purchased the common stock of the Company between July 7, 1999 and November 15, 1999, including investors purchasing in the Company's initial public offering as well as those purchasing in the open market. Named as defendants in some or all of the Actions are Musicmaker, The EMI Group, EMI Recorded Music, EMI Recorded Music North America, Robert P. Bernardi, Devarajan S. Puthukarai, Irwin H. Steinberg, Mark A. Fowler, Jay A. Samit, Jonathan A. B. Smith and John A. Skolas. The Class Action Complaint alleges violations of some or all of the following statutory provisions: Sections 11, 12(a)(2), and 15 of the Securities Act of 1933 and Sections 10(b), 20(a) and 20A of the Securities Exchange Act of 1934. On September 27, 2000, the Company filed a motion to dismiss the Class Action Complaint. On January 29, 2001 the Court heard oral arguments on the motion to dismiss, but no ruling has been issued yet. NEFF CORPORATION: Negotiations With United Rentals Terminated ------------------------------------------------------------- Neff Corporation, the members of its Board of Directors, two of its principal stockholders and United Rentals, Inc. are defendants in at least nine lawsuits filed in the Delaware Court of Chancery. Five of the suits were filed on January 3, 2001, two were filed on January 4, 2001 and two were filed on January 5, 2001. The plaintiffs in the suits are stockholders of Neff who purport to bring the suits as class actions on behalf of all persons, other than the defendants, who own the Company's Class A common stock. The complaints allege, among other things, that the defendants breached their fiduciary duties to its public shareholders and engaged in self- dealing in negotiating the terms of a proposal Neff received from United Rentals, Inc. to acquire the Company's Class A common stock held by the public. On February 26, 2001, Neff announced that the United Rentals proposal had expired and negotiations with United Rentals had terminated. NETZERO INC.: 1999 IPO Fosters Several Securities Suits ------------------------------------------------------- Netzero, Inc. disclosed in a regulatory filing recently that in April 2001, the Company and certain of its officers and directors were served with a complaint alleging violations of the federal securities laws. A number of other complaints have since been filed containing similar allegations, but only one other complaint has been served as of May 14, 2001. These complaints were brought as purported shareholder class actions under Sections 11 and 15 of the Securities Act of 1933, as amended. The complaints generally allege that the prospectus through which NetZero conducted its initial public offering in September 1999 was materially false and misleading. NEW VALLEY: Discovery On Shareholders Suit In Delaware Has Begun ---------------------------------------------------------------- In July 1999, a purported class action was commenced on behalf of the New Valley Corporation's former Class B preferred shareholders against the Company, Brooke Group Holding and certain directors and officers of the Company in Delaware Chancery Court. The complaint alleges that the re-capitalization, approved by a majority of each class of the Company's stockholders in May 1999, was fundamentally unfair to the Class B preferred shareholders, the proxy statement relating to the re-capitalization was materially deficient and the defendants breached their fiduciary duties to the Class B preferred shareholders in approving the transaction. The Court, on the defendants' motion, recently dismissed six of plaintiff's nine claims alleging inadequate disclosure in the proxy statement. The surviving claims are plaintiff's allegations that: (i) the fact that the fairness opinion did not cover the relative fairness to each class of shares should have been expressly disclosed; (ii) failure to disclose the identity of shareholders who suggested the re-capitalization and their respective holdings, broken down by share class, was a material omission; and (iii) the disclosure in the proxy statement was inadequate because it did not reveal the value of the Company's lines of business or its assets. The Court speculated that facts might exist under which one or more of the foregoing alleged non-disclosures might be material and, therefore, the motion to dismiss as to these three allegations was denied. An answer has been filed as to the surviving claims. Discovery in the case has commenced. PARK PLACE: Mohawk Tribal Court Hands Down $1.8 Billion Judgement ----------------------------------------------------------------- On April 26, 2000, certain individual members of the Saint Regis Mohawk Tribe purported to commence a class action proceeding in a "tribal court" in Hogansburg, New York against Park Place Entertainment Corporation and certain of its executives. The proceeding seeks to nullify Park Place's agreement with the Saint Regis Mohawk Tribe to develop and manage gaming facilities in the State of New York. On June 2, 2000, Park Place and certain of its executives filed an action in the United States District Court for the Northern District of New York seeking to enjoin the dissident Tribe members from proceeding in the tribal court with an action that the Company believe has been unlawfully convened and is without merit. In September 2000, the District Court dismissed the Park Place action on the grounds that the Court lacked jurisdiction. In October 2000, the Company appealed the judgment to the United States Court of Appeals for the Second Circuit. On March 21, 2001, the tribal court rendered a purported default judgment against Park Place in the amount of $1.8 billion, which judgment Park Place refuses to recognize as valid. Park Place intends to pursue all necessary actions to enjoin any efforts to enforce the purported judgment. PARK PLACE:Plaintiffs Appeal Case Dismissal To Delaware Supreme Court --------------------------------------------------------------------- A purported class action against Bally Entertainment Corporation, a company purchased by Park Place Entertainment Corporation in 1996, its directors and Hilton Hotels Corporation was commenced on September 4, 1996, under the caption Parnes v. Bally Entertainment Corporation, et al. in the Court of Chancery of the State of Delaware, New Castle County. The plaintiff alleged that certain payments received by Arthur M. Goldberg in connection with the merger of Bally into Hilton in December 1996 involved breaches of fiduciary duty which denied other Bally shareholders an opportunity to sell their shares at the best possible price. The plaintiff sought injunctive relief enjoining the Bally-Hilton merger, disgorgement of profits, and unspecified damages. After a trial on the merits, the Court of Chancery of the State of Delaware dismissed all the plaintiff's claims, holding that the Company acted in full compliance with its fiduciary obligations. On March 20, 2001, plaintiffs filed an appeal in the Delaware Supreme Court. PINNACLE HOLDINGS: Faces Securities Suit Filed In M.D. Florida -------------------------------------------------------------- Florence Foster, on behalf of herself and others similarly situated, filed an action on March 23, 2001 against Pinnacle Holdings, Inc., Steven R. Day, Jeffrey J. Card and Robert Wolsey in the United States District Court for the Middle District of Florida, Tampa Division, Case No.: 8:01-CV-624-T-27MSS. Subsequently, one or more substantially identical actions were filed in the same court. The named plaintiffs in these actions claimed to have filed the actions on behalf of all persons who purchased the Company's securities during the "class period" between January 18, 2000 and March 17, 2001. The plaintiffs allege that Pinnacle and two of its current officers, Steven R. Day and Robert Wolsey, and one of its former officers, Jeffrey J. Card, violated Section 10 and Rule 10b-5 of the Securities Exchange Act of 1934, as amended by making misleading statements relating to certain of our financial statements, the Motorola Antenna Site Acquisition and other related matters in various press releases and filings with the SEC. "We intend to respond appropriately and in our best interests to these suits," the Company noted in a recent regulatory filing with SEC. PRICELINE.COM: Three Securities Lawsuits Filed In S.D. New York --------------------------------------------------------------- On March 16, March 26, and April 27, 2001, respectively, three putative class action complaints were filed in the U.S. District Court for the Southern District of New York naming Priceline.com, Inc., Richard S. Braddock, Jay Walker, Paul Francis, Morgan Stanley Dean Witter & Co., Merrill Lynch, Pierce, Fenner & Smith, Inc., BancBoston Robertson Stephens, Inc. and Salomon Smith Barney, Inc. as defendants (01 Civ. 2262, 01 Civ. 2576 and 01 Civ. 3590). The complaints allege, among other things, that priceline.com and the individual defendants named in the complaints violated the federal securities laws by issuing and selling priceline.com common stock in priceline.com's March 1999 initial public offering without disclosing to investors that some of the underwriters in the offering, including the lead underwriters, had allegedly solicited and received excessive and undisclosed commissions from certain investors. The Company intends to defend vigorously against these actions. RAVISENT TECHNOLOGIES: Awaits Hearing Date For Motion To Dismiss ---------------------------------------------------------------- Between February and April 2000, eleven class action lawsuits were filed against RAVISENT TECHNOLOGIES, INC. and certain of its officers and directors in the United States District Court for the Eastern District of Pennsylvania. On May 25, 2000, the cases were consolidated under Civil Action No. 00- CV-1014, and entitled "In re RAVISENT Technologies Inc. Securities Litigation". Pursuant to the court's consolidation order, a consolidated and amended class action complaint was filed on June 14, 2000 with an alleged class period of July 15, 1999 through April 27, 2000. This complaint alleges violations of the federal securities laws, specifically Sections 11 and 15 of the Securities Act of 1933, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. On July 3, 2000, the Company filed a motion to dismiss the consolidated and amended class action complaint. The motion is presently fully briefed and the parties are waiting a hearing date to be set for the motion. SAGENT TECHNOLOGY: Plaintiffs File Consolidated Securities Suit --------------------------------------------------------------- Sagent Technology, Inc. disclosed in a recent regulatory filing with the Securities and Exchange Commission that from October 20, 2000 to November 27, 2000, several class action lawsuits were filed in the United States District Court on behalf of the individual investors who purchased the Company's common stock between October 21, 1999 and April 18, 2000. The claims allege that the Company misrepresented its 1999 and 2000 prospects. The court recently consolidated the complaints and selected a lead plaintiff and counsel. A consolidated amended complaint was filed in April 2001. SOTHEBY'S HOLDINGS: Discovery On Six Lawsuits Stayed Until October 8 -------------------------------------------------------------------- Six indirect purchaser class action lawsuits have been filed against Sotheby's Holdings Inc., its subsidiary, Sotheby's, Inc. and Christie's in the Superior Court of the State of California, alleging violations of the Cartwright Act, California's antitrust statute, and the California Unfair Competition Act. The complaints in these lawsuits purport to be brought on behalf of individuals that indirectly purchased items in California from one or more of the defendants. The complaints generally allege, among other things, that the Company along with Christie's conspired to fix and raise the commissions charged to buyers and sellers of art and other items at auction, and that, as a result, such indirect purchasers paid more for art and other items than they otherwise would have paid in the absence of defendants' conduct. The Company filed a demurrer to these complaints on May 10, 2000. Pursuant to a stipulation among the parties, plaintiffs have until June 4, 2001 to file a consolidated amended complaint; defendants can then decide whether to file a further demurrer; and discovery is stayed until October 8, 2001. SPECTRUM BANCORPORATION: Opposes Move To Remand Case To Iowa Court ------------------------------------------------------------------ Great Western Bank, a subsidiary of Spectrum Bancorporation, Inc., will resist the motion filed by the plaintiffs asking the court to remand a purported class action lawsuit to the Iowa District Court in Lee County. The case is presently pending in the federal district court in Iowa. Meanwhile, no discovery has been conducted with respect to the aspects of this lawsuit including whether the case can properly proceed as a class action. On November 21, 2000, members of the purported class filed an amended petition in an action against Thousand Adventures, Inc., to add as defendants 18 lenders, including Great Western Bank, with respect to retail installment sales contracts originated by TAI in connection with its sale of campground memberships. The amended petition alleges that more than 50,000 class members purchased campground memberships at a cost ranging from $990 to $10,000 and that TAI assigned the contracts outright or as collateral to the lenders. The primary claim of the amended petition appears to be that the lenders, as holders of the installment contracts, are subject to all claims the members had against TAI, which allegedly include breach of contract and consumer fraud, among other things. USSEARCH.COM: Settles Damages Suit In CA, Awaits Court Approval --------------------------------------------------------------- On August 14, 2000 a proposed class action complaint was filed against USSearch.com, Inc. in the Superior Court of the State of California for the County of Los Angeles, Dorothy Pilkington and Alice Schwartz- Scholl, on behalf of themselves, and all other similarly situated, and on behalf of the general public vs. US Search.com, Inc., Case No. BC234858. The Complaint claims damages for breach of contract, violation of Unfair Practices Act, violation of the Consumer Legal Remedies Act, fraud and negligent misrepresentation in connection with the Company's adoption services. The Company and its insurance carrier have agreed with plaintiffs' counsel to terms for a settlement of this matter that is awaiting court approval. The Company's insurance carrier has agreed to cover the settlement amount with the Company agreeing to contribute $50,000.00 pursuant to a promissory note bearing no interest and payable in one year. WILLIAMS COMPANIES: Petitions Panel To Consolidate Cases -------------------------------------------------------- In November 2000, Pamela Gordon and Ruth Hendricks filed class actions in San Diego, California Superior Court on behalf of San Diego ratepayers against California power generators and traders including Williams Energy Services Company and Williams Energy Marketing & Trading Company, subsidiaries of Williams Companies, Inc. Three municipal water districts also filed a similar action on their own behalf. Other class actions have been filed on behalf of the people of California and on behalf of commercial restaurants in San Francisco Superior Court. These lawsuits result from the increase in wholesale power prices in California that began in the summer of 2000. Williams is also a defendant in other litigation arising out of California energy issues. The suits claim that the defendants acted to manipulate prices in violation of the California antitrust and unfair business practices statutes and other state and federal laws. The defendants have removed these cases to federal district courts and plaintiffs' petitions to remand are pending. The defendants have filed a petition with the multi-district litigation panel seeking consolidation of the cases. ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Trenton, New Jersey, and Beard Group, Inc., Washington, D.C. Larri-Nil G. Veloso and Lyndsey Resnick, Editors. Copyright 2001. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 301/951-6400. * * * End of Transmission * * *