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/raid1/www/Hosts/bankrupt/CAR_Public/010831.mbx C L A S S A C T I O N R E P O R T E R Friday, August 31, 2001, Vol. 3, No. 171 Headlines ACCELERATED NETWORKS: Says Suits Result Of Lawyers' Duplicative Zeal AIRSPAN NETWORKS: Lead Plaintiff In NY Suits Still Being Determined CVS CORPORATION: Bernstein Liebhard Begins MA Securities Suit DELANO TECHNOLOGY: Cauley Geller Launches Securities Suit In S.D. NY E-LOAN INC.: Cauley Geller Commences Securities Suit In S.D. New York HEALTHCARE LITIGATION: Florida Medical Group Joins Suit v. HMOs METROMEDIA FIBER: Schiffrin & Barroway Files S.D. NY Securities Suit MOTHERS WORK: Judge Certifies Suit, Orders Plaintiffs' Notification NORFOLK SOUTHERN: Multimillion-dollar Settlement Gets Final Court Nod ONI SYSTEMS: Milberg Weiss Commences Securities Suit In S.D. New York OTG SOFTWARE: Cauley Geller Initiates Securities Suit In S.D. NY PSS WORLD: Sept.11 Deadline Set For Lead Representative Appointment RAMBUS INC.: Plaintiffs Given Oct.9 Deadline To Appoint Lead Rep. SCIQUEST.COM: Stull Stull Commences Securities Suit In S.D. New York SIX FLAGS: Another Alleged Racial Discrimination Suit Filed v. Park STAMPS.COM: Insists Nothing's Irregular With IPO, Underwriters' Deal STATE PALACE: Judge Lifts Ban On Glow Sticks, Others In "Rave" Parties SULZER ORTHOPEDICS: Federal Judge Grants Preliminary Nod To $700M Pact UNITED STATES: American Indian Trust Fund Management Deemed "Faulty" VANTAGEMED CORPORATION: Motion To Dismiss Set For September Hearing ********* ACCELERATED NETWORKS: Says Suits Result Of Lawyers' Duplicative Zeal -------------------------------------------------------------------- Accelerated Networks, Inc. expects the two securities suits currently pending against it in New York, and all subsequent complaints of similar nature, will be consolidated. The Company also said it is prepared to face such suits, believing they are devoid of merits. A company disclosure filed recently with the Securities and Exchange Commission says Accelerated Networks believes it is just a victim of the present flair of lawyers bringing suit against publicly listed companies. "The Company understands that, to date, at least one hundred and ten other companies have been named in nearly identical lawsuits that have been filed by some of the same law firms," says the disclosure. The two pending suits in the U.S. District Court for the Southern District of New York accuse the Company of violating several federal securities laws when it released allegedly false and misleading financial statements for its initial public offering. The suits purport to represent all investors who purchased Company stocks between June 22, 2000 and June 8, 2001. Plaintiffs claim the Company violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Sections 11 and 15 of the Securities Act of 1933. The Company makes equipment that telecommunications providers use to send voice and data over broadband networks. Its voice gateways convert voice signals from broadband networks into the format recognized by standard phone networks, and its concentrators aggregate individual broadband lines into high-speed uplinks. AIRSPAN NETWORKS: Lead Plaintiff In NY Suits Still Being Determined ------------------------------------------------------------------- Plaintiffs who recently brought several securities lawsuits against Airspan Networks, Inc. are currently determining who among them should be appointed lead plaintiff, says a Company disclosure. According to the regulatory document filed recently with the Securities and Exchange Commission, there has been no other significant development in the case other than this. The Company says it is presently weighing its options but is willing to go to court and contest vigorously the allegations leveled against it in the U.S. District Court for the Southern District of New York. Plaintiffs are suing the company on charges of violating the Securities Act of 1933 and the Securities Exchange Act of 1934. They claim the Company issued a Registration Statement and Prospectus for its initial public offering that contained materially false and misleading information. Airspan Networks' products let service providers set up voice and data communications networks more quickly than installing traditional wireline networks. The systems consist of customer-premises terminals, network base stations, and signal concentrators. The company also sells software for planning, configuring, and managing network resources and subscriber services. CVS CORPORATION: Bernstein Liebhard Begins MA Securities Suit ------------------------------------------------------------- Bernstein Liebhard & Lifshitz, LLP recently filed a securities class action lawsuit on behalf all persons who acquired CVS Corporation (NYSE: CVS) securities between February 6, 2001 and June 27, 2001. The case is pending in the United States District Court for the District of Massachusetts. Named as defendants in the complaint are CVS and Tom Ryan, CVS's Chairman, President and Chief Executive Officer. The complaint charges defendants with violations of sections 10(b) and 20(a) the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges that during the Class Period, defendants issued to the investing public false and misleading information that materially misstated the Company's condition and prospects. Moreover, the Company failed to disclose material information necessary to make its prior statements not misleading. Specifically, throughout the Class Period, defendants repeatedly touted CVS's planned expansion and positive business prospects. However, defendants failed to disclose, among other things, that the Company was unable to successfully address the national shortage of pharmacists and that this shortage was negatively impacting CVS's business and that the Company's expansion plans would have to be scaled back in light of the difficulties facing the Company. On June 27, 2001, this information was revealed to the public and caused the price of CVS common stock dropped sharply, falling from $44.10 per share to $36.51 per share on extremely heavy trading volume. As a result of defendants' false statements and failure to disclose material information regarding the shortage of pharmacists, CVS's stock was artificially inflated throughout the Class Period. However, CVS insiders took advantage of the inflated stock price to dispose of shares of their personally-held stock for gross proceeds in excess of $8 million and CVS was able to raise $300 million through the issuance of notes on highly favorable terms. For more information, contact: Linda Flood, Director of Shareholder Relations by Mail: 10 East 40th Street, New York, New York 10016 by Phone: (800) 217-1522 or 212-779-1414 or by E-mail: CVS@bernlieb.com DELANO TECHNOLOGY: Cauley Geller Launches Securities Suit In S.D. NY -------------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP filed a class action in the United States District Court for the Southern District of New York recently, on behalf of purchasers of Delano Technology Corp. (Nasdaq: DTEC) securities during the period between February 8, 2000 and December 6, 2000, inclusive. The complaint charges the following defendants with violations of 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: (1) Delano Technology, (2) John Foresi, (3) Thomas Hearne, and (4) FleetBoston Robertson Stephens On or about February 8, 2000, Delano Technology commenced an initial public offering of 5 million of its shares of common stock at an offering price of $18.00 per share. In connection therewith, Delano Technology filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) Robertson Stephens had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Robertson Stephens allocated to those investors material portions of the restricted number of Delano Technology shares issued in connection with the Delano Technology IPO; and (ii) Robertson Stephens had entered into agreements with customers whereby Robertson Stephens agreed to allocate Delano Technology shares to those customers in the Delano Technology IPO in exchange for which the customers agreed to purchase additional Delano Technology shares in the aftermarket at pre- determined prices. For more information, contact: CAULEY GELLER BOWMAN & COATES, LLP through its Client Relations Department: Jackie Addison, Sue Null or Charlie Gastineau by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 or by E-mail: info@classlawyer.com E-LOAN INC.: Cauley Geller Commences Securities Suit In S.D. New York --------------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP filed recently a class action in the United States District Court for the Southern District of New York, on behalf of purchasers of E-LOAN, Inc. (Nasdaq: EELN) securities during the period between June 28, 1999 and December 6, 2000, inclusive. The complaint charges the following defendants with violations of 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: (1) E-LOAN, (2) Chris Larsen, (3) Janina Pawlowski, (4) Frank Siskowski, (5) Goldman, Sachs & Co., Inc., (6) FleetBoston Robertson Stephens, (5) Merrill Lynch, Pierce, Fenner & Smith Incorporated On or about June 28, 1999, E-LOAN commenced an initial public offering of 3.5 million of its shares of common stock at an offering price of $14.00 per share. In connection therewith, E-LOAN filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) the Underwriter Defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriter Defendants allocated to those investors material portions of the restricted number of E-LOAN shares issued in connection with the E-LOAN IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby the Underwriter Defendants agreed to allocate E-LOAN shares to those customers in the E-LOAN IPO in exchange for which the customers agreed to purchase additional E-LOAN shares in the aftermarket at pre-determined prices. For more information, contact: CAULEY GELLER BOWMAN & COATES, LLP through its Client Relations Department: Jackie Addison, Sue Null or Charlie Gastineau by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 or E-mail: info@classlawyer.com HEALTHCARE LITIGATION: Florida Medical Group Joins Suit v. HMOs --------------------------------------------------------------- The 16,000-member Florida Medical Association announced recently its intention to join an already burgeoning purported class action against eight healthcare management organizations, The Miami Herald reports. The organization is the fifth medical group to join the suit pending in Miami. The other four are the California Medical Association, Texas Medical Association, Medical Association of Georgia and the Denton County Medical Society in Texas. There are also individual doctors from seven states who are taking part in the suit. The doctors have accused the HMOs of racketeering, fraud and extortion in allegedly cheating them out of more than $1 billion. They claim the HMOs systematically pay at a lower rate than the doctors' bill, a practice called downcoding. Should the court grant class action status, it is estimated that the suit could involve as many as 600,000 physicians. The following are the HMOs named in the lawsuit: Aetna, Cigna Corp., Coventry Health Care, Health Net, Humana, Aetna's Prudential Health METROMEDIA FIBER: Schiffrin & Barroway Files S.D. NY Securities Suit -------------------------------------------------------------------- Schiffrin & Barroway, LLP filed recently a class action lawsuit in the United States District Court for the Southern District of New York, on behalf of all purchasers of the common stock of Metromedia Fiber Network, Inc. (Nasdaq: MFNX) from January 8, 2001 through July 2, 2001, inclusive. The complaint charges Metromedia and certain of its officers and directors with issuing false and misleading statements regarding its business and financial condition. Specifically, the complaint alleges that throughout the Class Period, defendants issued multiple press releases announcing Metromedia's receipt of a $350 million credit facility from Citicorp USA, Inc. that would enable Metromedia to complete the construction of an extensive fiber optic network. These statements were materially false and misleading because defendants failed to disclose that: (1) the Citicorp credit facility was contingent on the receipt of additional commitments from other lenders and that Metromedia was experiencing difficulty obtaining such commitments given the distressed market for telecom companies; (2) the further development of the Company's fiber optic network would be significantly delayed without obtaining the credit facility which was dependent on obtaining the necessary additional loan commitments; and (3) based on the foregoing, defendants' statements about the Company and its prospects were lacking in a reasonable basis at all times. Finally, on July 2, 2001, Metromedia issued a press release announcing that it received an extension of the commitment letter for its $350 million credit facility from Citicorp and revealed for the first time that the commitment letter from Citicorp was subject to the receipt of commitments from other lenders in the amount of $287.5 million. In response to this announcement, shares of Metromedia's stock closed at $1.95 per share on July 2, 2001, a far cry from the class period high of $19.06 reached on January 19, 2001. For more information, contact: Schiffrin & Barroway, LLP through Marc A. Topaz, Esq. or Stuart L. Berman, Esq. by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1-888-299-7706 (toll free) or 1-610-667-7706 or by E-mail: info@sbclasslaw.com MOTHERS WORK: Judge Certifies Suit, Orders Plaintiffs' Notification ------------------------------------------------------------------- A Spokane Superior Court judge ruled recently that a suit against Mothers Work Inc. can proceed to trial as a class action, The Spokesman-Review reports. Judge Robert Austin also ordered notices to be sent next month to about 300 potential class members. The lawsuit accuses the Delaware-based Company of not allowing its workers, many of whom are pregnant, to take lunch breaks or rest breaks. They are also not paid for overtime work rendered in violation of Washington state law. The Company operates two stores in Washington, employing predominantly pregnant women who can display its maternity clothing items. A lawyer for the plaintiffs estimates an award of $6 million to his clients should the jury rules in their favor. NORFOLK SOUTHERN: Multimillion-dollar Settlement Gets Final Court Nod --------------------------------------------------------------------- A federal judge Wednesday gave final approval to a class action settlement that will pay millions of dollars of cash and create a new telecommunications company for the benefit of more than 50,000 landowners in 15 states. Nels Ackerson, lead attorney for the landowners, said: "This is the largest settlement ever reached for rights to install fiber optic cable, and it creates more value for landowners than any other settlement. We are extremely pleased with the judge's decision." The payments will be made by the telecommunications subsidiary of Norfolk Southern Corp., owner one of the nation's largest railroads. The railroad subsidiary will obtain rights to install fiber optic cable along 2,500 miles of railroad rights of way. The landowners will get both cash and a piece of the action, which their attorneys say may have a value reaching hundreds of millions of dollars. Landowners in the class will be entitled to receive cash and a percentage of future fiber optic cable revenues. In addition, the landowners will own a newly created telecommunications company, which has been tentatively named Class Corridor, LLC. The landowner-owned company has rights to obtain at no charge up to 16 strands of fiber or, alternatively, to acquire conduits for installation of additional fiber throughout the fifteen-state system. The court's opinion stated: "Our independent assessment leads confidently to the conclusion that the proposed settlement is fair, adequate and reasonable." Only five class members out of more than 50,000 objected to any of the settlement terms. Noting that one objector had criticized the compensation terms for class members on the opposite side of the corridor from where fiber optic cable is to be laid, the court found that "reasonable class members -- whether cable side or non-cable side -- could reasonably conclude that the economic value of the settlement compares favorably with any amount they might win if they continued to trial." The 41-page opinion of Judge Sarah Evans Barker quotes from one of fourteen letters of support from State Farm Bureau Presidents: "While we are happy that a settlement has been negotiated that provides both cash and a percentage of revenues to the affected landowners, we are especially pleased with the part of the settlement that allows the landowners to own an enterprise that will control the future use of their land under the railroads for fiber optic cable purposes." Also quoted in the opinion is one of the leading writers on legal ethics in the United States, Professor Ronald Rotunda, who opined: "One of the most creative aspects of the settlement is the creation of Class Corridor to hold asset compensation." Reached following the release of the court's opinion, Professor Rotunda explained: "This opinion should withstand any appeal." He also complemented the fee arrangement for the attorneys, saying "unlike many class actions where class members get something difficult to value and class counsel get cash, here class counsel are putting their fees to the same risks as the class members' compensation." ONI SYSTEMS: Milberg Weiss Commences Securities Suit In S.D. New York --------------------------------------------------------------------- Milberg Weiss Bershad Hynes & Lerach, LLP filed recently a class action lawsuit on behalf of purchasers of the securities of ONI Systems Corp. (NASDAQ: ONIS) between May 31, 2000 and December 6, 2000, inclusive. The action is against defendants Goldman Sachs & Co., FleetBoston Robertson Stephens, Inc., Lehman Brothers, Inc., Salomon Smith Barney Inc., ONI, Hugh C. Martin and Chris A. Davis, and is pending in the United States District Court, Southern District of New York. The complaint alleges violations of 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. On or about May 31, 2000 ONI commenced an initial public offering of 8,000,000 of its shares of common stock at an offering price of $25.00 per share. In connection therewith, ONI filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (1) the Underwriter Defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriter Defendants allocated to those investors material portions of the restricted number of ONI shares issued in connection with the ONI IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby the Underwriter Defendants agreed to allocate ONI shares to those customers in the ONI IPO in exchange for which the customers agreed to purchase additional ONI shares in the aftermarket at pre-determined prices. For more information, contact: Steven G. Schulman or Samuel H. Rudman by Mail: One Pennsylvania Plaza, 49th fl., New York, NY, 10119-0165 by Phone: (800) 320-5081 by Email: onicase@milbergNY.com or visit the firm's Website: www.milberg.com OTG SOFTWARE: Cauley Geller Initiates Securities Suit In S.D. NY ---------------------------------------------------------------- Cauley Geller Bowman & Coates, LLP filed recently a class action in the United States District Court for the Southern District of New York, on behalf of purchasers of OTG Software, Inc. (Nasdaq: OTGS) securities during the period between March 10, 2000 and December 6, 2000, inclusive. The complaint charges the following defendants with violations of 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: (1) OTG, (2) Richard A. Kay, (3) F. William Caple, (4) Ronald W. Kaiser, (5) Credit Suisse First Boston Corporation, (6) Deutsche Bank Securities Inc., (7) SG Cowen Securities Corporation and (8) Friedman, Billings, Ramsey & Co., Inc. On or about March 10, 2000, OTG commenced an initial public offering of 5 million of its shares of common stock at an offering price of $19.00 per share. In connection therewith, OTG filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) the Underwriter Defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriter Defendants allocated to those investors material portions of the restricted number of OTG shares issued in connection with the OTG IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby the Underwriter Defendants agreed to allocate OTG shares to those customers in the OTG IPO in exchange for which the customers agreed to purchase additional OTG shares in the aftermarket at pre-determined prices. For more information, contact: CAULEY GELLER BOWMAN & COATES, LLP through its Client Relations Department: Jackie Addison, Sue Null or Charlie Gastineau by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 or by E-mail: info@classlawyer.com PSS WORLD: Sept.11 Deadline Set For Lead Representative Appointment ------------------------------------------------------------------- According to Pomerantz Haudek Block Grossman & Gross LLP, which has filed a class action lawsuit against PSS World Medical, Inc. (Nasdaq: PSSI), shareholders have until Tuesday, September 11, 2001 to seek appointment by the Court as one of the lead plaintiffs in this action. The firm said it has filed a suit against the Company's President and Chief Financial Officer, and the Company's Chairman and Chief Executive Officer, on behalf of all those persons or entities who purchased the securities of PSSI during the period between October 26, 1999 through September 1, 2000, inclusive. The lawsuit charges PSSI and two of its top officials with issuing materially false and misleading financial statements and press releases concerning the Company's net income and business operations. "If you purchased the securities of PSSI during the Class Period, you have until September 11, 2001 to ask the Court to appoint you as one of the lead plaintiffs for the Class. In order to serve as lead plaintiff, you must meet certain legal requirements," a firm press release says. "If you wish to discuss these actions or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail," the press release adds. On June 22, 2000, the Company announced its financial results for its fiscal fourth quarter and year ended March 31, 2000, and that it had entered into a definitive merger agreement with Fisher Scientific International, Inc. One of the key terms of the merger was that PSSI had to report EBITDA in excess of $23 million for the quarter ended June 30, 2000 in order for the merger to be consummated. PSSI announced in an August 8, 2000 press release that they were in compliance with this provision of the merger agreement and that the merger was expected to proceed. However, on September 1, 2000, the Company shocked the market when it announced that the merger agreement had been terminated. As a result, shares of PSSI stock, which had closed at $6.37 prior to the announcement of the merger termination, dropped dramatically upon dissemination of the news. When PSSI filed its Form 10-K on June 27, 2001, the Company disclosed that its internal controls over inventory, accounts payable, sales, and accounts receivable were materially deficient and that the Company had previously issued financial statements for the quarter ended June 30, 2000 which were materially misleading. As a result, PSSI would be forced to restate its previous financial data, and would also cause the Company's EBITDA for the June 30, 2000 quarter to be reduced, below the threshold that would have allowed the merger to be completed. RAMBUS INC.: Plaintiffs Given Oct.9 Deadline To Appoint Lead Rep. ----------------------------------------------------------------- Pomerantz Haudek Block Grossman & Gross LLP, which has filed a class action lawsuit against Rambus, Inc. (Nasdaq: RMBS) announced recently that shareholders have until Tuesday October 9, 2001 to seek appointment by the Court as one of the lead plaintiffs in this action. The firm says its pending suit against certain Company officials seeks to represent all persons or entities who purchased the securities of Rambus during the period between January 18, 2000 through May 9, 2001, inclusive. The lawsuit charges Rambus and certain of its officials with issuing misstatements about the Company's patents and related licensing agreements and concealing that patents were obtained by deceptive means, including Rambus' misuse of facts that it had learned at meetings of an industry standards-setting group. "If you purchased the securities of Rambus during the Class Period, you have until October 9, 2001 to ask the Court to appoint you as one of the lead plaintiffs for the Class," a firm press release says. "If you wish to discuss these actions or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail," the press release adds. On May 9, 2001, investors learned the truth of these misrepresentations when a jury in a patent infringement suit filed by Rambus against one of its competitors, Infineon Technologies AG, determined that Rambus' patents in question were obtained fraudulently, resulting in a $3.5 million punitive Judgment. Rambus's stock, which had traded as high as $127 in June 2000, plummeted during the above litigation and closed at $12.80 on the day of the verdict. In addition, prior to the disclosure of defendants' misconduct, and at times when Rambus' stock price was materially inflated by defendants' misleading statements, most of the individual defendants sold over $110 million worth of their Rambus stock in public markets and thereby benefited from their wrongdoing. SCIQUEST.COM: Stull Stull Commences Securities Suit In S.D. New York -------------------------------------------------------------------- Stull, Stull & Brody filed a class action lawsuit Wednesday in the United States District Court for the Southern District of New York, on behalf of purchasers of the common stock of SciQuest.com, Inc. (NASDAQ:SQST) from between November 19, 1999 and December 6, 2000, inclusive. The suit is pending against defendants BancBoston Robertson Stephens, Inc., Credit Suisse First Boston Corp., Goldman Sachs & Co., Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated. The complaint alleges violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about November 19, 1999, SciQuest.com commenced an initial public offering of 7,500,000 of its shares of common stock at an offering price of $16 per share. In connection therewith, SciQuest.com filed a registration statement, which incorporated a prospectus, with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (1) defendants had solicited and received excessive and undisclosed commissions from certain investors in exchange for which defendants allocated to those investors material portions of the restricted number of SciQuest.com shares issued in connection with the SciQuest.com IPO; and (ii) defendants had entered into agreements with customers whereby defendants agreed to allocate SciQuest.com shares to those customers in the SciQuest.com IPO in exchange for which the customers agreed to purchase additional SciQuest.com shares in the aftermarket at pre-determined prices. As alleged in the complaint, the SEC is investigating underwriting practices in connection with several other initial public offerings. For more information, contact: Tzivia Brody, Esq. by Phone: 1-800-337- 4983 (toll free) by E-mail: SSBNY@aol.com by Fax: 212/490-2022 or by Mail: Stull, Stull & Brody, 6 East 45th Street, New York, NY 10017 SIX FLAGS: Another Alleged Racial Discrimination Suit Filed v. Park ------------------------------------------------------------------- A lawsuit filed early this week has accused Six Flags Magic Mountain of discriminating against more than 4,000 of its African or African- American patrons, the Los Angeles Times reports. The suit claims employees of the park harassed, falsely imprisoned, assaulted and intimidated visitors of African or African American descent. According to 1984 Olympic boxing bronze medalist Israel Cole, who is one of the 14 plaintiffs in the suit, he was allegedly assaulted, battered, falsely imprisoned, falsely arrested and threatened by a park security worker in October last year. Cole also claims he was subjected to racial slurs during the incident, which included "disparaging remarks about his African tribal heritage." Lawyer Jacob George estimates that there are about 4,000 other individuals who received the same treatment. He did not explain in the lawsuit how he got his estimate. The suit asks for compensatory damages for lost admission fees, physical injuries and emotional distress as well as punitive damages. This is not the first suit of this nature to be filed against Six Flags. In fact, a similar suit was scheduled for trial last Wednesday. STAMPS.COM: Insists Nothing's Irregular With IPO, Underwriters' Deal -------------------------------------------------------------------- Stamps.com Inc. insists that its Initial Public Offerings have been conducted in the right manner and that it has never arranged any shady deal with its underwriters. "We believe that the claims against us and our officers and directors are without merit, and intend to defend the lawsuits vigorously," declares a Company disclosure filed recently with the SEC. The Company dismissed as meritless the securities suits that have been filed against it in May, June and July this year. The suits name certain current or former board members and/or officers of the Company as defendants. The complaints are pending in the United States District Court for the Southern District of New York. The lawsuits allege violations of the Securities Act of 1933 and the Securities Exchange Act of 1934 in connection with initial public offering of the Company and secondary offering of its common stock. The lawsuits arise out of certain investigations by U.S. regulatory and law enforcement authorities into alleged commission practices and other sales practices by certain underwriters. The lawsuits also name as defendants the principal underwriters in connection with initial and secondary public offerings, including Goldman, Sachs & Co. and BancBoston Robertson Stephens, Inc. The lawsuits allege that the underwriters engaged in allegedly improper commission practices and stock price manipulations in connection with the sale of our common stock. The Company's Internet postage service lets more than 300,000 registered users download free software from the company's site, purchase stamps online from its Postage Server, and print stamps directly onto envelopes and labels. STATE PALACE: Judge Lifts Ban On Glow Sticks, Others In "Rave" Parties ---------------------------------------------------------------------- "Ravers" in New Orleans can use their glow sticks, pacifiers, hand-held massagers and chill rooms at their events once again. A U.S. District Court judge recently cleared the way for the use of the above paraphernalia in "rave" events by issuing a preliminary injunction that prevented the U.S. Attorney's Office to enforce a plea bargain. The order follows the filing of a class action by the American Civil Liberties Union that questioned the plea bargain's constitutionality. Earlier, the Drug Enforcement Agency sued rave promoters at New Orleans' State Palace Theater for holding the events at which the "Ecstasy" drug is allegedly consumed. Glow sticks, pacifiers, masks and vapor rubs at "rave" dance parties are allegedly used to enhance the effects of the popular, illegal club drug. According to the ACLU suit, the plea bargain reached recently with federal prosecutors violated the ravers' First Amendment right to free speech and Fourth Amendment right against unlawful seizure of legal property. A hearing of the case has been set for December. SULZER ORTHOPEDICS: Federal Judge Grants Preliminary Nod To $700M Pact ---------------------------------------------------------------------- Sulzer Medica (NYSE: SM) and its US subsidiary Sulzer Orthopedics Inc., announced Wednesday that US District Judge Kathleen O'Malley has given preliminary approval to a landmark settlement agreement that provides compensation for all patients affected by Sulzer Orthopedics' recall of certain hip components. "We applaud Judge O'Malley for approving this innovative settlement that creates a new benchmark in product liability cases," said Dr. Stephan Rietiker, the new CEO of Sulzer Medica. "We have worked diligently to find a positive solution that provides just compensation to all affected patients. While the financial burden is a heavy one, it is bearable when distributed over the agreed-upon time frame," he said. "The bottom line is that we are able to remain in business as a viable company enabling us to meet our obligations to affected patients," he added. David Floyd, president of Austin, Texas-based Sulzer Orthopedics Inc., explained: "From the beginning, we have been steadfast in our commitment to ensure that all patients affected by the recall receive fair compensation." "The settlement is fair to everyone concerned," he said. On August 13, attorneys for Sulzer Orthopedics and a nationwide plaintiff's group submitted a "term sheet" for a class action settlement of the claims against Sulzer Orthopedics. The term sheet provided for an agreement to petition the United States District Court in Cleveland, Ohio, to certify a class comprised of all patients who received a recalled Inter-Op(TM) acetabular shell. Effectively, the approved settlement collects all pending lawsuits stemming from the recall of the hip shells at the federal level. Created in negotiations with representatives of the class action participants, the term sheet outlines substantial payments for the affected patients to be spread out over several years. "Clearly, Judge O'Malley recognized that this agreement addresses the needs of all parties fairly and that it is important to resolve these matters as early as possible," said Richard Scruggs, a lead counsel for Sulzer Orthopedics' settlement proposal. "This lawsuit potentially could have bankrupted a good company for an honest mistake, leaving 34,000 injured patients without any compensation at all," he said. Normally, when multiple personal injury cases are filed against one company as they have been against Sulzer Orthopedics, it often becomes a race to the courthouse by plaintiffs' attorneys," he said. The terms of the agreement call for, among other things, Sulzer Orthopedics to pay affected patients and their attorneys with a mix of two-thirds cash and one-third Sulzer Medica stock issued through American Depository Receipts (commonly called ADRs) over a period of several years, for a total outlay by the Sulzer Medica companies of up to $800 million in product liability claims. A patient who has undergone one corrective surgery, for example, will receive $37,500 in cash and $20,000 in stock (approximately 3,922 ADRs); a patient who has undergone more than one corrective surgery will receive $63,500 in cash and $34,000 in stock (approximately 6,667 ADRs). These payments will be made over and above reimbursements for medical costs. Additionally, Sulzer Orthopedics will cover legal costs so that the patient will not have to share the settlement with any legal representation they may have engaged. The settlement also includes payments to each patients' spouse; a $30 million extraordinary injury fund to compensate patients in special cases; and a $20 million monitoring fund to pay for diagnostic tracking of patients for five years. "The innovative settlement that we were able to reach came about because of the earnest efforts of all parties to reach an agreement to bring this case to an expeditious, fair conclusion," said Don Barrett, attorney representing the Plaintiffs' group. "I believe that we have accomplished that goal, and I appreciate being invited to the table to help hammer out this agreement," he said. Following this preliminary approval, the parties will file a joint motion to distribute and publish notice of the settlement and request the Court to schedule a Fairness Hearing for final approval of the settlement. Sulzer Medica's subsidiaries develop, manufacture and market implantable medical devices and biological products for cardiovascular and orthopedic markets worldwide. The product offering includes joint prostheses, spinal implants, dental implants, trauma surgery products, heart valves, vascular grafts and peripheral stents. UNITED STATES: American Indian Trust Fund Management Deemed "Faulty" -------------------------------------------------------------------- An investigator, appointed by the U.S. District Court, recently slammed the Department of Interior's American Indian trust accounting system. The complex system, which cost some $40 million and was designed to track American Indian trust funds has allegedly been mismanaged by the government. The system is central to a $10 billion class action lawsuit brought by the American Indians over royalties from American Indian land. The system is "faulty" and "may not be salvageable," said the investigator, according to a recent report in The Washington Post. U.S. District Judge Royce C. Lamberth is presiding in the lawsuit on behalf of 300,000 American Indians. The suit alleges that the government squandered at least $10 billion from the trust accounts established in 1887 to manage royalties from grazing, mining and oil drilling on American Indian lands. The investigator also said Interior officials and attorneys may have given false reports to Judge Lamberth and to Congress when they said the accounting system was nearly operational. The Interior Department's inspector general has been asked to investigate whether Judge Lamberth was misled, according to the Department's response; and the attorneys involved have been removed from the case until the probe is complete. Interior Secretary Gale A. Norton has ordered an outside appraisal of the accounting system, as well as directing a staffer to focus specifically on the accounting system. Additionally, more authority has been given to a trustee overseeing trust fund reform. VANTAGEMED CORPORATION: Motion To Dismiss Set For September Hearing ------------------------------------------------------------------- A motion filed by VantageMed Corporation seeking the dismissal of a consolidated securities suit in California is set to be heard next month, according to a Company report to the SEC. The same document reveals that the Company is very optimistic about its chances of prevailing over the suit currently pending in the U.S. District Court for the Eastern District of California. The consolidated suit consists of several actions filed beginning March 2000, alleging that the Company and certain directors and officers violated the Securities Act of 1933 and the Securities Exchange Act of 1934. Plaintiffs purport to represent a class of all persons who purchased the Company's common stock pursuant to its February 15, 2000 IPO. VantageMed is the developer of software that gives health care providers an advantage in the age-old battle against bureaucracy. More than two-thirds of the company's sales come from data conversion, maintenance, and other services revolving around its product suite, which handles such tasks as patient scheduling, billing, claims filing, and insurance verification. ********* 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. Enid Sterling, Larri-Nil 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 * * *