/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/011105.mbx C L A S S A C T I O N R E P O R T E R Monday, November 5, 2001, Vol. 3, No. 216 Headlines APROPOS TECHNOLOGY: Berman DeValerio Files Securities Suit in N.D. IL APROPOS TECHNOLOGY: Pomerantz Haudek Commences Suit in N.D. Illinois ASBESTOS LITIGATION: Suit Outlines Grand Conspiracy To Defraud Public AVANTGO INC.: Milberg Weiss Initiates Securities Suit in S.D. NY CARESCIENCE INC.: Berger Montague Commences Securities Suit in E.D.PA DIGITALTHINK INC.: Milberg Weiss Commences Securities Suit in S.D. NY ENRON CORPORATION: Lionel Glancy Initiates Securities Suit in S.D. TX FEDERAL AVIATION: AZ Residents Consider Suit Over Flight Path Changes FORD MOTOR: Documents On Rollovers Question Ford Explorer Design FORD MOTOR: Resumes Settlement Talks With Workers Re Pending Lawsuits IMPSAT FIBER: Milberg Weiss Announces Suit Filed In S.D. New York LAFARGE CORPORATION: Court Certifies Factory Operations Particle Suit METASOLV SOFTWARE: Bernstein Liebhard Commences Securities Suit In NY METRICOM INC.: Lovell Stewart Initiates Securities Suit in N.D. CA NET PERCEPTIONS: Wolf Haldenstein Announces Suit Lodged In SD New York NEXTCARD INC.: Wolf Haldenstein Commences Securities Suit in N.D. IL NEXTCARD INC.: Milberg Weiss Commences Securities Suit In ND CA NORTHPOINT COMMUNICATIONS: Schiffrin & Barroway Sues In S.D. New York RENT-A-CENTER INC.: Settles Gender Discrimination Suit For $12.3M SEARS ROEBUCK: Sued For Credit Card Confidentiality Policy Violations SOUTH SHORE: Former Residents Sue For Mold and Mildew Problems, Damage SPORT-HALEY: Dyer & Shuman Begins Securities Lawsuit In Colorado SULZER MEDICA: Appeals Court Reverses $783M Settlement Approval TAISHUN COUNTY: Chinese Court Awards Tunnel Workers $25 Million TOBACCO LITIGATION: Witness Testifies To Companies' Research Efforts TUT SYSTEMS: Schiffrin & Barroway Announces Suit Filed In S.D. NY ********* APROPOS TECHNOLOGY: Berman DeValerio Files Securities Suit in N.D. IL --------------------------------------------------------------------- Berman DeValerio Pease Tabacco Burt and Pucillo lodged a securities class action against Apropos Technology, Inc. (NASDAQ:APRS) on behalf of all investors who bought Company stock in its February 17, 2000 public offering or on the open market through May 15, 2000. The suit, filed in the U.S. District Court for the Northern District of Illinois, charged the Company with making false statements about the composition of the company's management team in regulatory filings linked to its initial public offering. According to the complaint, the prospectus for the February 17, 2000 offering falsely stated that co-founders Patrick K. Brady and William W. Bach were active members of its executive management team when they had stopped playing important roles within the company months before the prospectus was issued. Named as defendants are the company, its top directors and the underwriters who helped take it public. The prospectus listed Brady as Chief Technology Officer and Bach as Vice President of technology, but Company President and CEO Kevin G. Kerns had effectively ousted Brady after a power struggle that culminated in July 1999. Though Brady maintained his title, he no longer had a company office or any employees who reported to him. Similarly, Kerns stripped Bach of his executive managerial responsibilities and involvement in shaping the company's core technology. Kerns, who became the de-facto CTO, attempted to hire a replacement for Brady before the prospectus was issued, but was unsuccessful. So, Brady and Bach were listed in the prospectus as technology officers. The Company issued nearly 4 million shares of common stock at $22 per share to thousands of investors based on offering materials that falsely stated that the founders who designed its key technological product were managing the company. "As a technology company whose business plan and future success depended heavily on proprietary technology, investors considered it important that the Apropos founders -- the people who developed and patented that proprietary technology -- still believed in the company, its business and its technology," the complaint says. For further details, contact Steven D. Morris or Michael G. Lange by Mail: One Liberty Square, Boston, MA 02109 by Phone: (800) 516-9926 By E-mail: law@bermanesq.com or visit the firm's Website: www.bermanesq.com APROPOS TECHNOLOGY: Pomerantz Haudek Commences Suit in N.D. Illinois -------------------------------------------------------------------- Pomerantz Haudek Block Grossman & Gross LLP filed recently a class action lawsuit against Apropos Technology, Inc. (Nasdaq: APRS). The suit was filed on behalf of all investors who purchased Apropos stock in its February 17, 2000 initial public offering or in the open market during the period between February 17, 2000 through May 15, 2000, inclusive. The case was filed in the United States District Court for the Northern District of Illinois (Eastern Division). The Complaint alleges that Apropos, a technology-driven customer interaction management solution company, the Company's top directors and the underwriters who helped take the Company public, violated Sections 11, 12(a)(2) and 15 of the Securities Act of 1933. In particular, it is alleged that the Registration Statement and Prospectus for the Company's IPO contained material misrepresentations and omissions regarding the role that two of the Company's co-founders - Patrick K. Brady and William W. Bach - played in the Company at that time. Specifically, it is alleged that the Company's Prospectus misrepresented that both Brady and Bach were active members of its executive management team and the Company's most senior technology officers. Brady was listed as "Chief Technology Officer" and Bach was listed as "Vice President, Technology" when both had stopped playing important roles within the company months before the prospectus was issued. It is further alleged that Apropos' President and Chief Executive Officer Kevin G. Kerns had effectively pushed Brady out of the Company after a power struggle that culminated in July 1999. Brady no longer maintained a company office, had no employees who reported to him, and had no further ongoing involvement in the daily affairs of the Company. Similarly, Kerns demoted Bach and stripped him of his managerial responsibilities and involvement in shaping the company's core technology. At the time of the IPO, the Company's technology and development departments were in disarray. Kerns, who took on the CTO's functions, attempted to hire a replacement for Brady before the Prospectus was issued, but was unsuccessful. Apropos issued nearly 4 million shares of common stock, raising more than $87 million, to thousands of investors based on offering materials that falsely stated that the Company's founders who designed its key technological product were managing the company. For more information, contact Andrew G. Tolan, Esq. by Phone: 888-476- 6529 or by E-mail: agtolan@pomlaw.com ASBESTOS LITIGATION: Suit Outlines Grand Conspiracy To Defraud Public --------------------------------------------------------------------- Insurance companies and the asbestos industry forged a "secret conspiracy" to intentionally defraud the public regarding the dangers posed by fire-resistant materials, claims a purported class action filed last week. According to a report by The Charleston Gazette, the plaintiffs possess various evidences pointing to an alliance to suppress relevant information regarding the health hazards of asbestos exposure. This alleged conspiracy allowed the insurance firms to force several complainants to settle their claims for amounts substantially less than their true value. The suit filed in Berkeley County Circuit Court in West Virginia names 14 insurance companies and subsidiaries, including Aetna, Travelers and Commercial Union. The suit quoted the instructions given by Travelers to its defense lawyers in 1980: (1) "Never admit the authenticity" of certain documents previously discovered by the plaintiffs. (2) "Don't attempt to introduce pre-1964" documents, "as this would undermine a state-of-the-art defense." (3) "No attempt should be made to [interview] any witness unless the witness' history and prior testimony had been thoroughly reviewed." The suit also cites a 1977 memo from Aetna Insurance Co. outlining the mounting problem of asbestos claims. "The potential for punitive damages is very real, since there is evidence that the asbestos industry knew of the hazards many years ago, yet failed to warn," the memo said. Asbestos was once extremely popular as a fire-resistant insulator. When inhaled, the material's tiny fibers allegedly cause various health problems, including a fatal and irreversible lung condition. AVANTGO INC.: Milberg Weiss Initiates Securities Suit in S.D. NY ---------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach commenced a securities class action on behalf of purchasers of the securities of AvantGo Inc. (NASDAQ: AVGO) between September 27, 2000 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against the Company and: (1) Richard Owen, CEO, Director; (2) David Cooper, CFO, (3) Felix Lin, Chairman, (4) Credit Suisse First Boston Corp., (5) Merrill Lynch, Pierce, Fenner & Smith Inc. and (6) FleetBoston Robertson Stephens Inc. 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. In September 2000, the Company commenced an initial public offering of 5,500,000 of its shares of common stock, at an offering price of $12 per share. In connection therewith, the Company 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 underwriters had solicited and received excessive and undisclosed commissions from certain investors in exchange for which they allocated to those investors material portions of the restricted number of shares issued in connection with the IPO; and (ii) the Underwriter Defendants had entered into agreements with 10customers whereby the Underwriter Defendants agreed to allocate Company shares to those customers in the IPO in exchange for which the customers agreed to purchase additional shares in the aftermarket at pre-determined prices. For further 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 or visit the firm's Website: www.milberg.com CARESCIENCE INC.: Berger Montague Commences Securities Suit in E.D.PA --------------------------------------------------------------------- Berger & Montague PC filed a securities class action against CareScience, Inc. (NASDAQ:CARE) and its principal officers and directors. The suit was filed in the United States District Court for the Eastern District of Pennsylvania on behalf of all persons or entities who purchased the Company's securities during the period from June 28, 2000 through and including November 1, 2000, inclusive. The complaint alleges that the defendants violated Sections 11,12(a)(2) and 15 of the Securities Act of 1933 and misled investors by misrepresenting and failing to disclose material facts because the prospectus: (1) represented that the Company intended to use $20 million of the proceeds of its June, 2000 public offering for product development, and an additional $13 million to expand the Company's sales and marketing efforts; (2) stated that the Company's operating expenses were expected to continue to increase "as we expand our product development and sales and marketing efforts;" and that "as we execute our strategy we expect significant increases in our operating expenses to fund development of current and new product lines;" and (3) touted the Company's Careleader.com and CareScience.com products, stating that the sales of those products were expected to commence in 2001 In fact: (i) as disclosed at the end of the class period, the Company was planning only extremely minimal increases in selling, general and administrative expenses, a rate of increase which would not equal the represented $13 million to be used for the purpose for more than a decade. Indeed the increase in such expenditures was completed with the addition of a mere eight sales and marketing employees; (ii) the Company planned only modest increases in research and development, at a rate which similarly would not equal the represented amount to be used for that purpose for more than a decade; and (iii) the Company had yet to determine the marketability of its CareScience and CareLeader products, and, as a result, had no reasonable basis for the representation that sales of those products would begin in 2001 For more information, contact Sherrie R. Savett, Carole A. Broderick, Karen Orman, or Kimberly A. Walker by Mail: 1622 Locust Street, Philadelphia, PA 19103 by Phone: 888-891-2289 or 215-875-3000 by Fax: 215-875-5715 by E-mail: InvestorProtect@bm.net or visit the firm's Website: www.bergermontague.com DIGITALTHINK INC.: Milberg Weiss Commences Securities Suit in S.D. NY --------------------------------------------------------------------- Milberg Weiss Bershad Hynes and Lerach LLP initiated a securities class action on behalf of purchasers of the securities of DigitalThink, Inc (NASDAQ:DTHK) between February 24, 2000 and December 6, 2000 inclusive. The action is pending in the United States District Court, Southern District of New York against the Company and: (1) Peter J. Goettner, CEO, Chairman of the Board, (2) Michael W. Pope, CFO, (3) Credit Suisse First Boston Corporation and (4) FleetBoston Robertson Stephens Inc. 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. In February 2000, the Company commenced an initial public offering of 4,400,000 of its shares of common stock, at an offering price of $14 per share. In connection therewith, the Company filed a registration statement, which incorporated a prospectus with the Securities and Exchange Commission. The complaint further alleges that the prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) the underwriters had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the underwriters allocated to those investors material portions of the restricted number of Company shares issued in connection with the IPO; and (ii) the underwriters had entered into agreements with customers whereby the underwriters agreed to allocate Company shares to those customers in the IPO in exchange for which the customers agreed to purchase additional 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 or visit the firm's Website: www.milberg.com ENRON CORPORATION: Lionel Glancy Initiates Securities Suit in S.D. TX --------------------------------------------------------------------- The Law Offices of Lionel Z. Glancy commenced a securities class action lawsuit on behalf of a class consisting of all persons who purchased securities of Enron Corporation (NYSE:ENE) between Jan. 18, 2000, and Oct. 17, 2001, inclusive. The suit was filed in the United States District Court for the Southern District of Texas against the Company and certain of its officers and directors alleging violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and the dissemination of materially false and misleading statements regarding the nature of Enron's business, financial results and operations caused Enron's stock price to become artificially inflated, inflicting enormous damages on investors. For more information, contact Michael Goldberg by Mail: 1801 Avenue of the Stars, Suite 311, Los Angeles, Calif. 90067 by Phone: (310) 201- 9150 or (888) 773-9224 (toll-free) or by E-mail: info@glancylaw.com. FEDERAL AVIATION: AZ Residents Consider Suit Over Flight Path Changes --------------------------------------------------------------------- The Federal Aviation Administration (FAA) could face a class action from Cave Creek County, Arizona locals who oppose changes in the flight paths from Sky Harbor Airport. Officials with the agency are expected to announce changes in the flight paths out of the airport, the fifth busiest in the nation, by the end of November. The routes could be in use by Feb. 21, 2002. Local coalition Quiet Skies for Kids believes the new flight paths could bring over 107,000 low-flying jets directly over Cave Creek every year. They said the noise in the new flights could disrupt the quiet that the locals enjoy and cause property values to decline. The Cave Creek Unified School District has also expressed consternation over the plan as three of the new paths would go directly over the main school campus. Quiet at Spur Cross Ranch, just north of Cave Creek, could also be disrupted. Cave Creek, county and state taxpayers paid $21.8 million for this land in order to preserve it earlier this year. The coalition is now focusing on getting communities, homeowner groups and individual property owners to finance and support the suit, and has met mixed reactions. Cave Creek County seems to be firmly behind the suit and it was recently decided to let the County take the lead in the lawsuit. CCUSD Superintendent John Gordon, a long-time Quiet Skies supporter, did not say that the school district should join in on the lawsuit at meetings but also never said that it shouldn't. Recently, Cave Creek Mayor Vincent Francia met with his Scottsdale counterpart Mary Manross to see if her city would support the lawsuit against the FAA. Manross "didn't say yes and she didn't say no," according to Francia. However, she was not sure what to oppose as the FAA has not yet announced the new routes. Property owners in unincorporated areas of the county and exclusive developments like Desert Mountain have attended Quiet Skies meetings recently to learn more about the group. Homeowners from the Sinquadados area have also expressed an interest in going ahead with the lawsuit. Sinquadados resident Ray Sullivan says, "When we built at Sinquadados there was no noise and you could enjoy the night sky.That is what we spent the money for and now they are going to take it away." Quiet Skies leader John Hoeppner assesses the commitment that has come from individual property owners as an attempt to preserve Desert Rural zoning. "Part of Desert Rural is absolute quiet," Hoeppner said of the difference between low ambient noise levels here and the spikes in sound when a jet passes by. FORD MOTOR: Documents On Rollovers Question Ford Explorer Design ----------------------------------------------------------------- The United States District Court of Southern Indiana unsealed documents that claimed vehicle design problems in Ford Explorers caused deadly rollovers that led to more than 200 deaths and many injuries. More than 300 personal injury and class action suits were filed against Ford Motor Company and Bridgestone/Firestone Inc. due to the accidents. The documents refer to investigations in Venezuela that found problems with both faulty tires and the vehicles' suspensions. The primary document in question is a 1999 report by Ford engineers in Venezuela that said the vehicle's shock absorbers were too soft for the country's terrain, and that the tires were experiencing tread separation. Victor Diaz, counsel for the plaintiffs, added that the documents revealed that the Companies delayed taking precautionary actions abroad despite evidence of problems with the sport utility vehicle and its tires. He added that Ford disregarded the design concerns because it feared a design change in Venezuela would also require a change in U.S. models. In a brief, Diaz wrote that the two companies "withheld material information regarding the full extent of the problem, committed egregious errors of judgment" and "delayed taking corrective or preventative action." He reiterated that the documents clearly show that "the engineers in Venezuela were critical of the stability of the Ford Explorer vehicle, and believed that a problem in the design of the vehicle was contributing to the rollover accidents." Ford spokesman Ken Zino denied that claim, and said the report was an "early draft," merely an initial report by a junior engineer. He says, "Frankly, we don't care about this document.Extensive testing in Venezuela and the U.S. showed that not only is there not an issue with the shock absorber, but the Explorer before, during and after the tread separation acts typical of an SUV. There are reams of data to back that up." Bridgestone/Firestone spokeswoman Jill Bratina said the company disagrees with the claims and will make that clear as litigation proceeds. "This is the plaintiff's version of history," she said. "They have excerpted documents, taken them out of context and omitted significant details. It does not accurately portray the situation." The National Highway Traffic Safety Administration independently investigated the rollovers and has said there was no evidence to support Bridgestone/Firestone's claim that the Explorer's design was faulty and at least partly to blame. FORD MOTOR: Resumes Settlement Talks With Workers Re Pending Lawsuits --------------------------------------------------------------------- Ford Motor Co. lawyers revived last week settlement talks with current and former white-collar employees who have pending age, gender and racial discrimination suits against the Company, according to the Wall Street Journal. The resumption of talks followed the instatement of William Clay Ford, Jr. as the new Chief Executive of the Company, replacing Jacques Nasser. It was Nasser who instituted two years ago a rating system that tended to favor the minorities and women in the Company, and eliminated white male managers. The rating system attracted several individual lawsuits as well as purported class actions. It also prompted a reverse discrimination suit based on allegations that it targeted older white male employees for dismissal. IMPSAT FIBER: Milberg Weiss Announces Suit Filed In S.D. New York ----------------------------------------------------------------- The Plaintiffs' Executive Committee for In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS) announces that a class action lawsuit was filed on November 1, 2001, on behalf of purchasers of the securities of IMPSAT Fiber Networks Inc. (NASDAQ: IMPT) between February 1, 2000 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against defendants: (1) IMPSAT, Ricardo A. Verdaguer (CEO, President and Director), (2) Enrique M. Pescarmona (Chairman), (3) Guillermo Jofre (CFO) (4) Morgan Stanley & Co. Inc., (5) Goldman Sachs & Co., (6) Salomon Smith Barney Inc., and (7) Merrill Lynch, Pierce, Fenner & Smith Inc. 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 February 1, 2000, IMPSAT commenced an initial public offering of 11,500,000 of its shares of common stock at an offering price of $17 per share. In connection therewith, IMPSAT 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 IMPSAT shares issued in connection with the IMPSAT IPO; and (ii) the Underwriter Defendants had entered into agreements with customers whereby the Underwriter Defendants agreed to allocate IMPSAT shares to those customers in the IMPSAT IPO in exchange for which the customers agreed to purchase additional IMPSAT shares in the aftermarket at pre-determined prices. This action is being prosecuted by the Plaintiffs' Executive Committee of In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS). By Order, dated October 12, 2001, the Honorable Shira A. Scheindlin appointed these firms to serve as the Plaintiffs' Executive Committee: (a) Bernstein Liebhard & Lifshitz, LLP; (b) Milberg Weiss Bershad Hynes & Lerach LLP; (c) Schiffrin & Barroway LLP; (d) Sirota & Sirota LLP; (e) Stull, Stull & Brody; and (f) Wolf Haldenstein Freeman & Herz LLP The Court has given the Plaintiffs' Executive Committee responsibility for the prosecution of the IPO Securities Litigation. 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 or visit this Website: www.milberg.com LAFARGE CORPORATION: Court Certifies Factory Operations Particle Suit --------------------------------------------------------------------- Bay City Federal Court granted class certification to a suit filed by Alpena, Michigan residents against cement manufacturer LaFarge Corporation, for trespassing, nuisance and negligence relating to their cement plant operations. The suit alleges that particles from the cement factory settled on their property, damaged their homes and plants causing them mental anguish and "loss of enjoyment of their homes." The plaintiffs filed the suit on behalf of all owners of single-family homes who had their property disturbed by the Company's pollution. In his opinion, Lawson wrote: "Kiln dust from the plant is emitted into the air, causing a bad odor and covering cars, houses and plants with a white film, damaging paint and siding and killing rose bushes." The ruling, however was not a total setback for the Company - while Lawson certified the suit, he granted the Company's motion to dismiss claims of trespassing, only allowing claims of nuisance and negligence. A status conference on the suit is scheduled for Nov. 15. The Maryland-based Corporation has owned and operated the cement plant in since 1987. The one-square-mile factory and quarry, which turns limestone into cement, employs about 400 workers. METASOLV SOFTWARE: Bernstein Liebhard Commences Securities Suit In NY --------------------------------------------------------------------- Bernstein Liebhard and Lifshitz initiated a securities class action on behalf of purchasers of the securities of MetaSolv Software, Inc. (NASDAQ: MSLV) between November 17, 1999 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against the Company and: (1) Morgan Stanley Dean Witter, Inc., (2) BancBoston Robertson Stephens, Inc., (3) Jeffries & Company, Inc., (4) James P. Janicki and (5) Glenn A. Etherington 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. Last November 1999, the Company commenced an initial public offering of 5,000,000 of its shares of common stock, at an offering price of $19 per share. In connection therewith, the Company filed a registration statement, which incorporated a prospectus with the Securities and Exchange Commission. The complaint further alleges that the prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) the Company had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the underwriters allocated to those investors material portions of the restricted number of shares issued in connection with the IPO; and (ii) the underwriters had entered into agreements with customers whereby they agreed to allocate shares to those customers in the IPO in exchange for which the customers agreed to purchase additional shares in the aftermarket at pre-determined prices. For more information, contact Ms. 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 by E-mail: MSLV@bernlieb.com or visit the firm's Website: www.bernlieb.com METRICOM INC.: Lovell Stewart Initiates Securities Suit in N.D. CA ------------------------------------------------------------------ Lovell & Stewart, LLP filed a securities class action on behalf of all persons who purchased Metricom, Inc. common stock between June 21, 1999 and July 2, 2001, inclusive, in the United States District Court for the Northern District of California. The suit alleges that defendants violated Sections 11, 12, and 15 and the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The defendants allegedly issued a series of material misrepresentations to the market between June 21, 1999 and July 2, 2001, thereby artificially inflating the price of the Company's common stock. Specifically, the complaint alleges that certain defendants, beginning in June 1999, issued statements concerning the Company's business, financial results and operations which failed to disclose or only partially disclosed three material agreements with MCI WorldCom, Inc. These material transactions were: (1) a Reseller Agreement, executed June 20, 1999 (initially disclosed to the public on November 5, 1999); (2) a Global Services Agreement, executed October 3, 2000, which required the Company to pay to WorldCom substantial "termination" fees, and (3) an Agreement whereby WorldCom was to supply selected telecommunications equipment, office equipment, and related office product to the Company. Neither of the last two material agreements nor the creation of substantial contingent liability were ever disclosed to the public. In February 2000, The Company closed a secondary public offering composed of 5 million shares of its common stock, at a price of $87 per share. Many of the material terms of the operant Worldcom agreement were not revealed to investors prior to the offering, nor were corrective disclosures made as new information relating to the agreements with Worldcom became known. Additionally, although the Company's business plan and marketing strategy were known to contain flaws, certain defendants failed to disclose that material fact to the public. Additionally, certain defendants disseminated materially false and misleading statements, which manipulated and artificially inflated the Company's common stock price. These knowingly false and misleading statements drove Company stock from $11.06 per share near the beginning of the class period to as high as $109.50 per share on January 28, 2000 just prior to the offering. After dissipating substantially all of its cash and making a series of shocking negative disclosures in the first half of the year, on July 2, 2001, the Company and its affiliates filed voluntary petitions for bankruptcy relief. Only then did it become apparent that the Company's entire business model and marketing strategy had been flawed from the start. In the bankruptcy filings, it was disclosed that contingent claims approached almost $700 million with total debts exceeding $1 billion. The Company's last pre-bankruptcy trade per share was for $1.82, a decline exceeding 93% over the prior 12 months. For more information, contact Christopher Lovell, Merrick S. Rayle, or Robert W. Rodriguez by Phone: (212) 608-1900 by E-mail: sklovell@aol.com or visit the firm's Website: www.lovellstewart.com NET PERCEPTIONS: Wolf Haldenstein Announces Suit Lodged In SD New York ---------------------------------------------------------------------- The Plaintiffs' Executive Committee for In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS) announces that a class action lawsuit was filed last week on behalf of purchasers of the securities of Net Perceptions, Inc. (NASDAQ: NETP) between April 22, 1999 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against defendants Net Perceptions, certain of its officers and its underwriters. The title of the case is Fox v. Net Perceptions, Inc. et al (01-CV-9675). 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 April 22, 1999, Net Perceptions commenced an initial public offering of 3.65 million of its shares of common stock at an offering price of $14 per share. In connection therewith, Net Perceptions 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 Underwriters had solicited and received excessive and undisclosed commissions from certain investors in exchange for which those Underwriters allocated to those investors material portions of the restricted number of IPO shares issued in connection with the Net Perceptions IPO; and (2) the Underwriters had entered into agreements with customers whereby the Underwriters agreed to allocate shares to those customers in the Net Perceptions IPO in exchange for which the customers agreed to purchase additional Net Perceptions shares in the aftermarket at pre-determined prices. This action is being prosecuted by the Plaintiffs' Executive Committee of In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS). By Order, dated October 12, 2001, the Honorable Shira A. Scheindlin appointed these firms to serve as the Plaintiffs' Executive Committee: (i) Bernstein, Liebhard & Lifshitz, LLP; (ii) Milberg Weiss Bershad Hynes & Lerach LLP; (iii) Schiffrin & Barroway LLP; (iv) Sirota & Sirota LLP; (v) Stull, Stull & Brody LLP; and (vi) Wolf Haldenstein Adler Freeman & Herz LLP The Court has given The Plaintiffs' Executive Committee responsibility for the prosecution of the IPO Securities Litigation. For further details, contact: Wolf Haldenstein Adler Freeman & Herz LLP, New York through Fred Taylor Isquith, Esq., Thomas H. Burt, Esq., Gustavo Bruckner, Esq., Michael Miske, George Peters or Derek Behnke by Phone: 800/575-0735 by E-mail: classmember@whafh.com or visit this Website: www.whafh.com NEXTCARD INC.: Wolf Haldenstein Commences Securities Suit in N.D. IL -------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP initiated a securities class action on behalf of all purchasers of the securities of NextCard, Inc. (NASDAQ:NXCD) between March 30, 2000 and October 30, 2001, inclusive. The suit was filed in the United States District Court for the Northern District of Illinois, Eastern Division, against the Company and certain of its officers and directors. The complaint charges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder by making a series of materially false and misleading statements. Specifically, the suit alleges that beginning in March 2001, the Company claimed that its wholly owned banking division was "well- capitalized" as that term is understood under regulations of the Federal Deposit Insurance Corporation. The Company also purposely mischaracterized its true loan loss levels, in order to qualify for the most beneficial insurance treatment and cost of funds, when in fact the company was experiencing ever increasing loan defaults. The complaint further alleges that as a result of these false and misleading statements the price of Company securities were artificially inflated throughout the class period. Additionally, certain officers and directors sold over $10 million worth of artificially inflated Company securities during the class period. The Company revealed on October 31, 2001, that: (1) its banking division was in fact "significantly undercapitalized"; (2) it had failed to provide sufficient reserves for delinquent loans; and (3) it had inadequately characterized its true credit losses The Company stock then collapsed -- wiping out 84% of market value in just one day and causing plaintiff and the other members of the class to suffer damages. For further information, contact Fred Taylor Isquity, Thomas Burt, Gustavo Bruckner, Michael Miske, George Peters or Derek Behnke by Mail: 270 Madison Avenue, New York, New York 10016 by Phone: 800-575-0735 by E-mail: classmember@whafh.com or visit the firm's Website: www.whafh.com. All e-mail correspondence should make reference to NextCard. NEXTCARD INC.: Milberg Weiss Commences Securities Suit In ND CA --------------------------------------------------------------- Milberg Weiss commenced late last week a class action in the United States District Court for the Northern District of California on behalf of purchasers of NextCard Inc. (NASDAQ:NXCD) publicly traded securities during the period between March 30, 2000 and Oct. 30, 2001. The complaint charges NextCard and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants disseminated false and misleading statements concerning the Company's operations and prospects for 2000 and 2001. In fact, defendants knew NextCard's reserves were materially under-funded and that as a result, its 2000 and 2001 projections and/or results were false. During the Class Period, taking advantage of the inflation in NextCard stock, defendants Lent, Cai, Qureshey and Hashman sold almost $9 million worth of their own NextCard stock at artificially inflated prices of as much as $10.89 per share. Then, on October 31, 2001, it was revealed that, among other things, defendants had concealed that during the Class Period: (1) due to the deteriorating quality of NextCard's portfolio, the Company would need to dramatically increase its reserves for loan losses in fiscal 2000 and Q1, Q2 and Q3 2001 and as a result its reported value of its loans for fiscal 2000 and Q1 and Q2 2001 was overstated; (2) the Company had improperly recorded "credit losses" as "fraud losses" and as a result the Company's "securitization activities" during the Class Period did not qualify for "low level recourse treatment." Defendants knew that as a result, such would dramatically increase the Company bank division's risk weighted assets, and would decrease the Company's "risk based capital ratio" below federal banking guidelines - rendering the Company "significantly under capitalized"; (3) because the Company's risk-based capital ratio had plummeted below acceptable levels, it had been technically subject to a Prompt Correction Action Order and thereby restricted from accepting or reviewing any brokened deposits; (4) as a result of the above, the Company's 2000 and 2001 results and projections were materially false and misleading. These disclosures shocked the market, causing NextCard's stock to decline to $0.84 per share before closing at $0.87 per share on October 31, 2001 on volume of more than 43 million shares, inflicting millions of dollars of damage on plaintiff and the Class. For more details, contact Milberg Weiss Bershad Hynes & Lerach LLP William Lerach by Phone: 800/449-4900 or by E-mail: wsl@milberg.com NORTHPOINT COMMUNICATIONS: Schiffrin & Barroway Sues In S.D. New York --------------------------------------------------------------------- The Plaintiffs' Executive Committee for In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS) announces that a class action lawsuit was filed on October 30, 2001, on behalf of purchasers of the common stock of NorthPoint Communications Group, Inc. (OTC Board: NPNTQ) between May 5, 1999 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against defendants NorthPoint Communications Group, Inc., certain of its officers and its underwriters. 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 5, 1999, NorthPoint commenced an initial public offering of 15,000,000 of its shares of common stock at an offering price of $24 per share. In connection therewith, NorthPoint 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 Underwriters had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriters allocated to those investors material portions of the restricted number of NorthPoint shares issued in connection with the NorthPoint IPO; and (2) the Underwriters had entered into agreements with customers whereby the Underwriters agreed to allocate NorthPoint shares to those customers in the NorthPoint IPO in exchange for which the customers agreed to purchase additional NorthPoint shares in the aftermarket at pre-determined prices. This action is being prosecuted by the Plaintiffs' Executive Committee of In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS). By Order, dated October 12, 2001, the Honorable Shira A. Scheindlin appointed these firms to serve as the Plaintiffs' Executive Committee: (i) Berstein Liebhard & Lifshitz, LLP; (ii) Milberg Weiss Bershad Hynes & Lerach LLP; (iii) Schiffrin & Barroway LLP; (iv) Sirota & Sirota LLP; (v) Stull, Stull & Brody; and (vi) Wolf Haldenstein Freeman & Herz LLP The Court has given The Plaintiffs' Executive Committee responsibility for the prosecution of the IPO Securities Litigation. 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 at info@sbclasslaw.com RENT-A-CENTER INC.: Settles Gender Discrimination Suit For $12.3M ----------------------------------------------------------------- Rent-A-Center, Inc. (NASDAQNM: RCII) settled for $12.3 million the class action suit filed by 4,600 female employees and some applicants alleging gender discrimination. Plaintiffs filed the suit in Kansas City, Missouri federal court on behalf of women who worked or applied for jobs at the company between April 19, 1998, and October 1, 2001. The suit alleges that the Company: (1) eliminated jobs held by women; (2) imposed unreasonable weightlifting requirements; (3) unfairly disciplined female employees; (4) demoted female employees to clerical and cleaning duties; and (5) fired some female employees. The Company admitted no liability in the settlement. Company president Mitchell E. Fadel released a statement, saying "while our track record in providing an indiscriminatory workplace is strong, we believe the proposed settlement is in the best interests of Rent-A- Center given the costs and uncertainty of litigation." The company also agreed to develop policies to assure gender equity in the workplace. The settlement amount, subject to court approval, doesn't include attorneys' fees, which will be awarded by the court, or costs to administer the settlement process. Rent-A-Center, Inc. operates and franchises more than 2,500 stores that rent home electronics, furniture and other household items. Customers can buy the products after making a number of payments. SEARS ROEBUCK: Sued For Credit Card Confidentiality Policy Violations --------------------------------------------------------------------- Sears, Roebuck and Co. faces a class action suit from two Company credit-card holders in Cook County Circuit Court, alleging the retailer sold confidential information about them to a marketing firm. Plaintiffs Arin Bovay and Debra Wathen allege that the Company violated the privacy of its credit-card holders and unjustly enriched itself at their expense. The Company allegedly sold personal and confidential information to direct marketing firm Memberworks Inc., who has sold health and dental discount programs to their customers in the past. A Company spokeswoman refuted the allegations saying that it did not breach its confidentiality policy because Memberworks was a licensee of Sears and therefore a "member of the Sears family of businesses." She also added that some of their customers are still in the Memberworks health and dental programs, but the Company is no longer marketing them to new customers. SOUTH SHORE: Former Residents Sue For Mold and Mildew Problem, Damage --------------------------------------------------------------------- Eight former residents of the South Shore Lakes Apartments have filed a class action in the 405th district court in Galveston, Texas alleging mold and mildew problems. The suit alleges that toxic mold contaminated their furniture, clothing and personal belongings and caused severe health problems for the plaintiffs. Counsel for the plaintiffs Kenneth T. Ward said the mold "has affected (the plaintiffs) health and that these apartments are not presently a safe place to live." The suit says the plaintiffs moved into the apartments "at various times in 1999 and 2000," and "almost immediately, plaintiffs began to notice problems associated with mold and mildew in their apartment(s)." The lawsuit also stated "plaintiffs have had their apartments inspected by two different specialists to determine the species of molds present and to access indoor air quality." The specialist who inspected the place found several species of mold: (1) stachybotrys, (2) aspergillius, (3) penicillium, (4) cladisporium and (5) cahetomium. The suit alleges that the complex received many complaints about "mold, mildew and fungus problems similar to plaintiffs" but neglected to "warn tenants of the South Shore Lakes apartment complex of the problems and of the existence of potential problems, and took no effective steps by qualified personnel to cure the problem." The plaintiffs moved to "alternate living quarters...and have incurred additional expenses in renting alternate furniture and purchasing additional clothing and personal items to temporarily replace those items that have been contaminated." South Shore Lakes Apartments and its corporate office Hettig Management Corporation declined comment. SPORT-HALEY: Dyer & Shuman Begins Securities Lawsuit In Colorado ---------------------------------------------------------------- Dyer & Shuman, LLP announced last week that it recently filed a class action in the U.S. District Court, District of Colorado on behalf of purchasers of Sport-Haley, Inc. (Nasdaq: SPOR) common stock during the period between September 4, 1996, and October 16, 2000, inclusive. The complaint charges Sport-Haley and certain of its officers and directors with violations of Section 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, Sport-Haley continually reported artificially inflated earnings via false and misleading press releases and filings with the Securities and Exchange Commission. As a result, on October 16, 2000, the company announced that it would be forced to restate its financial statements for the 1998 and 1999 fiscal years. This disclosure prompted the NASDAQ to suspend trading of Sport-Haley stock. It also prompted the SEC to commence an informal inquiry. On November 6, 2000, the company announced the extent of its restatements. Specifically, defendants admitted that they had materially overstated the company's earnings for the 1996, 1997, 1998 and 1999 fiscal years, and that the company would restate its net income for the year ended June 30, 1998, from $4.3 million to $2.5 million, and from $814,000 to $147,000 for the year ended June 30, 1999. When the NASDAQ finally resumed trading, the company's stock initially lost 37% of its value. Moreover, after receiving documents from the company and interviewing company employees, the SEC began a formal investigation into possible violations of the federal securities laws. For more information, contact: John M. Martin of Dyer & Shuman, LLP by Phone: 800/711-6483 or 303/861-3003 or by E-mail: jmartin@dyershuman.com SULZER MEDICA: Appeals Court Reverses $783M Settlement Approval --------------------------------------------------------------- The U.S. Sixth Circuit Court of Appeals reversed the preliminary approval given by U.S. District Judge Kathleen O'Malley to the proposed class action settlement by Swiss orthopedic company Sulzer Medica. The ruling paved the way for individual claims against the Company and dashed the Company's hopes to settle the claims through a single $783 million settlement. More than 1,600 lawsuits were filed last December against the Company after it recalled thousands of hip and knee implants after patients who were fitted with them suffered severe pain and slipping. The Company later determined that oil residue on the hip and knee implants caused the implants not to bond properly to the patients' bones. Under the settlement, the Company would pay patients who needed surgery after receiving the faulty hip or knee implants between $57,500 and $97,500 in cash and stock. The Company may now face hundreds of state court lawsuits and be forced to seek bankruptcy protection if it's overwhelmed with individual claims. However, Stephan Rietiker, CEO of Sulzer Medica Ltd., says the company remains confident a settlement will be reached over the company's faulty hip implants. He said, "This decision is not a surprise for us and does not mean that we will change our strategy in any way.We will continue to oppose individual legal actions with every means possible." According to the Company's press release, negotiations with attorneys for the patients are continuing independent of the court decision. TAISHUN COUNTY: Chinese Court Awards Tunnel Workers $25 Million --------------------------------------------------------------- Chinese migrant workers who contracted the respiratory disease silicosis, while digging a tunnel for a major expressway in China, scored a huge class action settlement verdict last week, reported the Xinhua News Agency. A Wenzhou Intermediate People's Court in China's Zhejiang Province awarded the class of 230 workers damages amounting to CNY208 million (US$25 million). Chief Judge Yu Wei held Taishun County Tunnel Engineering Co. and three of its shareholders were held responsible for the silicosis the workers developed after working on the expressway without the proper protective gear. The court found that from 1993 to 1996, the employers ordered the workers to dig holes with pneumatic drills into rock that had a silicon dioxide density of 97.6 percent. According to the court, without respirators and other protective equipment, this work environment forced the excavators to inhale large amounts of silicon dioxide, causing their silicosis. The case was filed in April. Of the 230 class members, ten have already died of silicosis, which was diagnosed among the tunnel workers in 1998. TOBACCO LITIGATION: Witness Testifies To Companies' Research Efforts -------------------------------------------------------------------- Tobacco companies struggled for more than 30 years to design a safer cigarette, enduring many failures, a former researcher asserted as trial in landmark West Virginia smokers' class action continues. Jerry Whidby, part-time consultant to tobacco giant Philip Morris, testified that scientists at the Company continue those efforts today, achieving some success but meeting many "expensive" failures. Whidby was the latest witness to testify for the defense in the suit, which was filed by 250,000 smokers against four big tobacco companies, namely RJ Reynolds, Brown and Williamson, Lorillard and Philip Morris. The suit alleges that the Companies showed a "wanton and willful" disregard for the public's health by designing a "defective product" and ignoring mounting evidence that smoking causes disease. The smokers want the companies to pay for an unprecedented medical monitoring program that reportedly could detect smoking related diseases like lung cancer and emphysema earlier. The defendants have reiterated that they have never wavered in their efforts to produce a "risk-free" cigarette, and have tried to introduce products that were rejected by consumers. Whidby says that the development of technology hasn't always kept pace with researchers' ideas, saying: "Science is built upon other science. It takes time. It takes people." The companies have contended that cigarettes were an inherently risky product and the best way for smokers to avoid disease and prolong their lives is to quit smoking. TUT SYSTEMS: Schiffrin & Barroway Announces Suit Filed In S.D. NY ----------------------------------------------------------------- The Plaintiffs' Executive Committee in In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS) announces that a class action lawsuit was filed on October 30, 2001, on behalf of purchasers of the common stock of Tut Systems, Inc. (Nasdaq: TUTS) between January 29, 1999 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against defendants Tut Systems, Inc., certain of its officers and its underwriters. 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 January 29, 1999, Tut commenced an initial public offering of 2,500,000 of its shares of common stock at an offering price of $18 per share. In connection therewith, Tut 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 Underwriters had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the Underwriters allocated to those investors material portions of the restricted number of Tut shares issued in connection with the Tut IPO; and (2) the Underwriters had entered into agreements with customers whereby the Underwriters agreed to allocate Tut shares to those customers in the Tut IPO in exchange for which the customers agreed to purchase additional Tut shares in the aftermarket at pre-determined prices. This action is being prosecuted by the Plaintiffs' Executive Committee of In re: Initial Public Offering Securities Litigation, 21 MC 92 (SAS). By Order, dated October 12, 2001, the Honorable Shira A. Scheindlin appointed these firms to serve as the Plaintiffs' Executive Committee: (i) Bernstein Liebhard & Lifshitz, LLP; (ii) Milberg Weiss Bershad Hynes & Lerach LLP; (iii) Schiffrin & Barroway LLP; (iv) Sirota & Sirota LLP; (v) Stull, Stull & Brody; and (vi) Wolf Haldenstein Freeman & Herz LLP The Plaintiffs' Executive Committee is responsible for the prosecution of the IPO Securities Litigation. For further 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 ********* 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, Aurora Fatima Antonio 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. 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