/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/011109.mbx C L A S S A C T I O N R E P O R T E R Friday, November 9, 2001, Vol. 3, No. 220 Headlines ADAMS MARK: Judge Denies Certification Due To Lack of "Commonality" AETNA INC.: Lovell Stewart Initiates Securities Suit in S.D. New York AIRGATE PCS: Schiffrin Barroway Commences Securities Suit in S.D. NY APPLERA CORPORATION: Sued For Celera Genomics Stocks Sale Violations APROPOS TECHNOLOGY: Schiffrin Barroway Lodges Securities Suit in IL APROPOS TECHNOLOGY: Cauley Geller Initiates Securities Suit in N.D. IL BRIDGESTONE CORPORATION: Settles State Rollover Suit For $51.5M CJ's RESTAURANT: Accord Reached On Suit Due To Food Poisoning Outbreak ENRON CORPORATION: Rabin Peckel Commences Securities Suit in S.D. TX EVOLVE SOFTWARE: Schiffrin Barroway Files Securities Suit in S.D. NY GENERAL MOTORS: Utah Gas Tank Claims Settled For Over $32 Million GREAT WESTERN: Court To Rule On Settlement in Iowa Consumer Fraud Suit IBM CORPORATION: Deskstar Drive User Sues For Alleged Product Defects ICN PHARMACEUTICALS: Charged With Securities Laws Violations In C.D.CA METAWAVE COMMUNICATIONS: Schiffrin Barroway Files NY Securities Suit MORGAN STANLEY: Court's Response To NY Fraud Suit Appeal Still Pending NEBRASKA: Judge Says Cap Doesn't Apply To Children Of Disabled Mothers NEW YORK: Judge Grants Class Certification To Insurance Fraud Suit NEXTCARD INC.: Cauley Geller Commences Securities Suit in N.D. CA PASADENA SCHOOLS: Agrees To Settle Illegal Student Fees Suit For $227T PEROT SYSTEMS: Denies S.D. New York Securities Suits' Accusations PROVIDIAN FINANCIAL: Wolf Haldenstein Files Securities Suit in N.D. CA SIRIUS SATELLITE: Schiffrin Barroway Commences VT Securities Suit SIRIUS SATELLITE: Cauley Geller Initiates Securities Suit in Vermont TALISMAN ENERGY: Faces $1B Suit Protesting South Sudan Oil Operations TERADYNE INC.: Stull Stull Commences Securities Suit in Massachusetts TEXTRON/LYCOMING: Moves To Close Malibu Mirage Aircraft Suit Website UNISYS CORPORATION: Fairness Hearing For Settlement Set For Dec. 2001 USINTERNETWORKING INC.: Finkelstein Thompson Lodges Suit in S.D. NY UTSTARCOM INC.: States It Expects Similar Securities Suits In Future WASTE MANAGEMENT: Concedes To $457M TX Securities Suit Settlement ********* ADAMS MARK: Judge Denies Certification Due To Lack of "Commonality" ------------------------------------------------------------------- A U.S. Magistrate Judge denied class certification to a lawsuit filed by African-American employees of the Adams Mark chain of hotels, saying the plaintiffs could not meet "typicality" and "commonality" requirements. The employees filed the suit, alleging they were victimized by a "general policy of racial discrimination" carried out through an entirely subjective decision-making process put into place by the company's owner Fred Kummer. Judge Charles B. Smith said his decision was based on the fact that the plaintiffs were unable to pinpoint a "centralized decision making process" that affected them all. Smith noted in his 80-page report that the suit was filed on behalf of all current and former African-American employees of defendants and challenges "almost every employment practice," including: (1) promotional decisions; (2) salary, raise and benefits decisions; (3) hostile work environment; (4) hiring, training, promotion; (5) retaliation; and (6) termination He said that much of the evidence presented was designed to show that Kummer is a "racist" and that he has taken steps to eliminate promotions that will attract black customers. Smith said this reasoning was "flawed", saying the plaintiffs "make the broad leap that the adverse employment actions suffered by the putative class representatives resulted directly from Mr. Kummer's racist tendencies, which have permeated the ranks of the hotel management." He said that although the plaintiffs were "somewhat convincing", their briefs failed to show any evidence of a "broad discriminatory policy in the employment decisions of the company." Smith said the plaintiffs were unable to "make a link between the racial policies directed towards African-American customers of the hotel and the employment discrimination claims of the defendants' African-American employees." He further opined, "No evidence exists that Fred Kummer was involved in these day-to-day employment decisions at each of these hotels." "Should this court certify the class, we would create a melting pot of all African-American hourly and salaried employees, in every department of each of defendants' 24 nationwide hotels, challenging every type of employment action, by every supervisor and managerial employee," Smith wrote. "Indeed, the sole commonality among these named plaintiffs and, presumably, among the putative class members is their race," Smith said in his report. Smith's recommendations will become the law of the case, if U.S. District Judge R. Barclay Surrick, who referred all pretrial matters to Smith, adopts them. Smith has recommended that eight of the 11 named plaintiffs send their cases back to their home districts in Missouri, North Carolina, Colorado and Alabama. Lawyers on both sides now have 10 days to lodge objections to Smith's report. AETNA INC.: Lovell Stewart Initiates Securities Suit in S.D. New York --------------------------------------------------------------------- Lovell & Stewart LLP filed a securities class action on behalf of all purchasers of Aetna, Inc. (NYSE:AET) securities between December 13, 2000 and June 7, 2001, inclusive. The suite was filed in the United States District Court for the Southern District of New York. The Complaint alleges that defendants violated 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 before and during the class period, thereby artificially inflating the price of the Company's common stock. Specifically, the complaint alleges that the Company issued statements concerning, among other things, the ability of the Company to control and monitor its costs and obligations in light of the Company's expected and actual sales. Defendants allegedly knew that the Company's management systems, procedures and controls for monitoring such costs were lacking but they continued to make positive statements about these matters. Between April 10, 2001 and May 8, 2001, the Company surprised the market by announcing: (1) higher-than-anticipated medical costs during the fourth quarter of 2000 and the first quarter of 2001, (2) faulty record-keeping which caused the payment of millions of dollars in medical claims for former clients, and (3) the absence of necessary management control systems required for management to know the Company's obligations and proper medical costs Finally, on June 7, 2001, it was revealed that the cause of much of the Company's financial woes was that: "Poor record-keeping has resulted in ... paying millions of dollars in medical claims for people whose benefits have expired." During the class period, the value of Company shares had been artificially inflated to almost $43.00 per share but, as a result of these disclosures, the Company's stock price plunged in excess of forty percent to below $25.00 per share. For more information, contact the Law Offices of Lovell & Stewart, LLP by phone: 212-608-1900 or visit the firm's Website: www.lovellstewart.com AIRGATE PCS: Schiffrin Barroway Commences Securities Suit in S.D. NY -------------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action on behalf of purchasers of AirGate PCS, Inc. (NASDAQ:PCSA) common stock between September 27, 1999 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against: (1) Donaldson, Lufkin & Jenrette Securities Corporation and (2) Credit Suisse First Boston Corporation The complaint alleges violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. In September 1999, the Company commenced an initial public offering of 6,700,000 of its shares of common stock, at an offering price of $17 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) 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 shares issued in connection with the IPO; and (ii) defendants had entered into agreements with customers whereby 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 more information, contact Marc A. Topaz or Stuart L. Berman 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 by E-mail: info@sbclasslaw.com or visit the firm's Website: www.sbclasslaw.com APPLERA CORPORATION: Sued For Celera Genomics Stocks Sale Violations -------------------------------------------------------------------- Laboratory instruments maker Applera Corporation faces a consolidated securities class action filed on behalf of purchasers of subsidiary Celera Genomics stock in the Company's follow-up public offering completed on March 6, 2000. In the offering, the Company sold an aggregate of approximately 4.4 million shares of Celera stock at a public offering price of $225 per share. All of these lawsuits have been consolidated into a single case and an amended consolidated complaint was filed in August 2001. The consolidated complaint generally alleges that the prospectus used in connection with the offering was inaccurate or misleading because it failed to adequately disclose the alleged opposition of the Human Genome Project and the governments of the United States and the United Kingdom, to providing patent protection to the Company's genomic-based products. Although the Celera Genomics group has never sought, or intended to seek, a patent on the basic human genome sequence data, the complaint also alleges that the Company did not adequately disclose the risk that it would not be able to patent this data. The Company believes the asserted claims are without merit and intends to defend the case vigorously. However, it is uncertain about the outcome of the case or any other litigation arising from it. APROPOS TECHNOLOGY: Schiffrin Barroway Lodges Securities Suit in IL ------------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action on behalf of all purchasers of Apropos Technology, Inc. (NASDAQ:APRS) common stock from February 17, 2000 through May 15, 2000, inclusive. The suit, pending in the United States District Court for the Northern District of Illinois, against the Company, its top directors and its underwriters. The suit alleges the defendants issued false and misleading statements concerning its business and financial condition. Specifically, the complaint alleges that 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. The prospectus listed Brady as Chief Technology Officer and Bach as Vice President of Technology, but Apropos 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, therefore 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 Company founders - the people who developed and patented that proprietary technology - still believed in the company, its business and its technology," the complaint says. For more information, contact Marc A. Topaz or Stuart L. Berman 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 by E-mail: info@sbclasslaw.com or visit the firm's Website: www.sbclasslaw.com APROPOS TECHNOLOGY: Cauley Geller Initiates Securities Suit in N.D. IL ---------------------------------------------------------------------- Cauley Geller Bowman & Coates LLP commenced a securities class action on behalf of purchasers of Apropos Technology, Inc. (NASDAQ:APRS) common stock in its February 17, 2000 initial public offering or in the open market during the period between February 17, 2000 and May 15, 2000, inclusive. The suit, filed in the United States District Court for the Northern District of Illinois, Eastern Division, charges the Company, the Company's top directors and its underwriters with violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933. Specifically, the complaint charges 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 officers. Brady was listed as "Chief Technology Officer" (CTO) 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 Company President and Chief Executive Officer (CEO) 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. Thereafter, both Brady and Bach were listed in the prospectus and falsely portrayed as active participants in the executive management of the Company and its senior technology officers. The Company 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 details, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888- 551-9944 (toll-free) by E-mail: info@classlawyer.com or visit the firm's Website: www.classlawyer.com BRIDGESTONE CORPORATION: Settles State Rollover Suit For $51.5M --------------------------------------------------------------- Bridgestone Corporation will settle, for $51.5 million, state claims of deaths and injuries linked to reportedly faulty Firestone tires, announced Delaware Attorney General M. Jane Brady. The National Highway Traffic Safety Administration linked Firestone tires to 271 deaths and more than 800 injuries, in rollovers involving Ford Motor's Explorer sport utility vehicles that used Firestone tires. The investigation severed the almost 100-year-old relationship between the two Companies as each blamed the other for the accidents. Ford said it would stop using Firestone tires and is pushing for billions of dollars in reimbursements, despite reports that Chief Executive William Clay Ford Jr., was open to talks with the Company. The Company recalled an additional 3.5 million Wilderness AT Tires sold on Ford vehicles and provided as replacements in the first recall of 6.5 million last year. Another NHTSA investigation revealed that Ford's Explorer sport utility vehicle was no more likely to roll over after a tire separation than other SUVs, dealing another blow to the Company. Under the settlement, the Company will pay $500,000 to all 50 states, the District of Columbia, Puerto Rico and the US Virgin Islands and spend $10 million for investigation costs and $5 million on consumer education about tire safety. The Company will also create a reimbursement fund for consumers who exchanged recalled tires last year for brands made by its competitors. In addition, the Company is required to monitor damages and failure claims from tire owners, data it had ignored in safety investigations prior to the year 2000. The deal was reached a week ago, but took several days to finalize, one source said. The states had not sued Bridgestone, but had pressured Firestone to expand its recalls. Brady said, "this settlement assures a fair restitution process for the customers and provides greater protections for consumers in the future." Hundreds of private lawsuits are still pending against the two Companies, 400 of which the Company has settled in the recent months. Later this month, federal court will hear arguments as to whether the cases should be consolidated into a class-action lawsuit. Joan Claybrook, president of consumer group Public Citizen, said in an Associated Press interview, "I think Firestone is trying to close all the books on these pending matters.The recall has been done." CJ's RESTAURANT: Accord Reached On Suit Due To Food Poisoning Outbreak ---------------------------------------------------------------------- A notice of settlement was filed recently in Miami County Common Pleas Court by Judge Jeffrey Welbaum, in the class-action filed following an E. coli food poisoning outbreak traced to the former CJ's HighMarks Restaurant in Troy, the Dayton Daily News recently reported. In December 1999, the family of an infected boy filed a $10 million class action lawsuit against the restaurant. This event followed an E. coli outbreak, in November 1999, traced to the HighMarks, which sickened 39 people. Details of the settlement were not disclosed. Judge Welbaum wrote in the notice approving the settlement and dismissing the lawsuit, that all parties were notified of the proposed settlement, allocation of litigation costs and attorney fees. He said no objections were received. According to the settlement notice, both sides were agreeing not to disclose the documents outlining the settlement until a further court order. High Marks' lawyer James Utrecht of Troy said the settlement agreement prohibited any comment. Gary Plunkett of Dayton, lawyer for the plaintiffs, was not available for comment. Health Commissioner Jim Luken said the contamination was an unusual outbreak because HighMarks otherwise had run a clean operation. The restaurant, which had opened in 1990, in Troy, closed a few weeks ago for remodeling. ENRON CORPORATION: Rabin Peckel Commences Securities Suit in S.D. TX -------------------------------------------------------------------- Rabin and Peckel LLP initiated a securities class action on behalf of all persons or entities who purchased Enron Corporation (NYSE:ENE) common stock between January 18, 2000 and October 17, 2001, inclusive. The suit is pending in the United States District Court for the Southern District of Texas against the Company and: (1) Kenneth Lay, (2) Jeffrey K. Skilling and (3) Andrew Fastow. The suit alleges that defendants violated Section 10(b) and 20(a) of the Securities and Exchange Act of 1934 by issuing a series of material misrepresentations to the market during the class period. The suit further alleges that the Company issued a series of statements concerning its business, financial results and operations that failed to disclose: (i) that the Company's Broadband Services Division was experiencing declining demand for bandwidth and the Company's efforts to create a trading market for bandwidth were not meeting with success as many of the market participants were not creditworthy; (ii) that the Company's operating results were materially overstated as a result of the Company failing to timely write- down the value of its investments with certain limited partnerships which were managed by the Company's chief financial officer; and (iii) that the Company was failing to write-down impaired assets on a timely basis in accordance with generally accepted accounting principles. During the class period, Company insiders disposed of over $73 million of their personally held common stock to unsuspecting investors. In October 2001, the Company surprised the market by announcing that it was taking non-recurring charges of $1.01 billion after-tax, or ($1.11) loss per diluted share, in the third quarter of 2001, the period ending September 30, 2001. Subsequently, the Company revealed that a material portion of the charge was related to the unwinding of investments with certain limited partnerships that were controlled by its Chief Financial Officer. The Company also revealed it would be eliminating more than $1 billion in shareholder equity as a result of its unwinding of the investments. When this news hit the market, the price of the Company's common stock dropped significantly. For more information, contact Maurice Pesso or Eric Belfi by Mail: 275 Madison Avenue, New York, NY 10016 by Phone: (800) 497-8076 or (212) 682-1818 by Fax: (212) 682-1892 or by E-mail: email@rabinlaw.com or visit the firm's Website: www.rabinlaw.com EVOLVE SOFTWARE: Schiffrin Barroway Files Securities Suit in S.D. NY -------------------------------------------------------------------- Schiffrin and Barroway LLP lodged a securities class action on behalf of purchasers of Evolve Software, Inc. (NASDAQ:EVLV) common stock between August 9, 2000 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against the Company, 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. In August 2000, the Company commenced an initial public offering of 5,000,000 of its shares of common stock at an offering price of $9 per share. In connection therewith, the Company filed a registration statement, which incorporated a prospectus that 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 Company shares issued in connection with the IPO; and (2) the underwriters had entered into agreements with customers whereby the underwriters agreed to allocate Company shares to those customers in the Company IPO in exchange for which the customers agreed to purchase additional shares in the aftermarket at pre-determined prices. For more information, contact Marc A. Topaz or Stuart L. Berman 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 by E-mail: info@sbclasslaw.com or visit the firm's Website: www.sbclasslaw.com GENERAL MOTORS: Utah Gas Tank Claims Settled For Over $32 Million ----------------------------------------------------------------- General Motors Corporation recently agreed to pay more than $32 million to settle lawsuits brought in Utah and some other states by about 44,000 owners of General Motors' Chevrolet Tahoe and Yukon sports utility vehicles, The Salt Lake Tribune recently reported. The Utah lawsuit, like the others, alleged that the fuel tanks on the 1995, 1996 and 1997 Tahoe and Yukon vehicles held less gas than the 30 gallons advertised. As one of the two representatives of the Utah class action, Ladel Laub of Beryl, Utah, will receive a $10,000 certificate from General Motors toward the purchase of a new vehicle. Other Tahoe and Yukon owners across the country who owned or leased the vehicles and filled out forms to be eligible for the settlement, will receive $750 certificates toward the purchase of a GM vehicle. The certificates may be transferred to other family members and also may be cashed in for a lesser dollar value, said Salt Lake City attorney Brent Hatch, who represented Laub and others in the Utah lawsuit. GREAT WESTERN: Court To Rule On Settlement in Iowa Consumer Fraud Suit ---------------------------------------------------------------------- The Iowa District Court for Lee County, Iowa will decide today if it will give final approval to the settlement agreement proposed by Great Western Bank has agreed to settle the class action arising from its relationship with campground operator Thousand Adventures, Inc. (TAI). In 1997, a consumer fraud class action was filed in the same court against TAI relating to retail installment sales contracts originated by TAI in connection with its sale of campground memberships. The suit was later amended to include 18 financial institutions, including the Company. The amended petition alleges that more than 50,000 class members purchased campground memberships at a cost ranging from $990 to $10,000 and that TAI assigned the contracts outright or as collateral to the lenders. The primary claim of the amended petition appears to be that the lenders, as holders of the installment contracts, are subject to all claims the members had against TAI, which allegedly include breach of contract and consumer fraud, among other things. In July 1997, a default judgment was entered against TAI certifying that action against it as a class action and in the same year, TAI began bankruptcy proceedings in the Iowa federal bankruptcy court. Last month, Great Western Bank was dismissed as a defendant in the above-described action and was named as sole defendant in a new proceeding, all pursuant to a pending final settlement agreement. If the pending settlement agreement becomes final, the amount of potential claims the Company will be obligated to pay would not have a material adverse effect on its financial condition or operations. In the event that the settlement agreement is not approved, and if the lawsuit were determined adversely to the Company, the decision might have a material adverse effect on the Company's financial condition or results of operations. The Company has also disclosed that it cannot yet estimate the amount of alleged damages, since the amount is "unspecified and speculative." IBM CORPORATION: Deskstar Drive User Sues For Alleged Product Defects --------------------------------------------------------------------- Computer giant IBM Corporation faces a class action lawsuit due to alleged defects in the Company's 75GXP hard drive that caused the product to crash. The drive, a 7,200RPM Deskstar 75GB drive, was released in March last year, and was touted by the Company as the first "IBM drive to use glass disk platters instead of aluminium" The press release also stated that the drive allowed "the recording head to read smaller bits of information that are packed more closely together. In addition, glass disks are more stable at higher speeds." Michael Granito, Jr., an American user, alleges in the suit that contrary to the Company's representations, the "Deskstar 75GXP is defectively designed and/or manufactured such that it is not a reliable HDD and fails to function properly." He said the defect manifests by the sudden occurrence of a loud clicking or scratching noise causing the drive to stop operating and crash. The suit further alleges "the result of the crash is the irreversible and permanent loss of data and software programs installed on the Deskstar." Nobody has determined the exact cause of the problem, but the Company has always maintained that it produced "super reliable" drives, which the suit refutes by pointing to a website that discusses "IBM hard disk drive reliability." ICN PHARMACEUTICALS: Charged With Securities Laws Violations In C.D.CA ---------------------------------------------------------------------- ICN Pharmaceuticals, Inc. faces a consolidated class action suit filed in the United States District Court for the Central District of California for securities laws violations. The consolidated suits arose from several class actions filed starting February 1995 against the Company and certain of its officers and directors. The defendants allegedly made various deceptive and untrue statements of material fact and omitted to state material facts in connection with information it received from the U.S. Food and Drug Administration (FDA) regarding the Company's New Drug Application (NDA) for the use of Virazole(R) for the treatment of chronic hepatitis C. The suit also alleges and that certain officers of the Company had allegedly engaged in illegal insider trading. n May 1995, an additional securities class action was filed against the defendants in the same court alleging that, the proxy materials and prospectus prepared in connection with the merger of: (1) ICN Pharmaceuticals, Inc., (2) SPI Pharmaceuticals, Inc., (3) Viratek, Inc. and (3) ICN Biomedicals, Inc., effective November 10, 1994 contained false and misleading information regarding the potential approval by the FDA of Virazole(R) for the Hepatitis C indication. The defendants had therefore established an excessive value for the shares of Viratek in setting the exchange ratios for the four companies in connection with the merger. The suit further alleged that the Company's Chairman had engaged in illegal insider trading of the Company's common stock. The suit was filed on behalf of a purported class of individuals who exchanged their shares of the old ICN, SPI or Biomedicals for newly issued shares of New ICN. The court promptly ordered the above suits consolidated and on June 15, the plaintiffs filed an amended consolidated complaint. The Court also ordered the Company to cooperate in a private investigation to be conducted by the Securities and Exchange Commission. The investigation relates to certain matters pertaining to the status and disposition of the Company's Hepatitis C NDA. The investigation hopes to find out whether, during the period June 1994, through February 1995, the Company, persons or entities associated with it and others, in the offer and sale or in connection with the purchase and sale of ICN common stock, engaged in possible violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC hopes to reveal whether the Company and its associates possibly: (i) made false or misleading statements or omitted to state material facts with respect to the status and disposition of the Hepatitis C NDA, or (ii) purchased or sold the Company's common stock while in possession of material, non-public information concerning the status and disposition of the Hepatitis C NDA or (iii) conveyed material, non-public information concerning the status and disposition of the Hepatitis C NDA to other persons who may have purchased or sold Company stock. The Company is cooperating with the SEC in its investigation. METAWAVE COMMUNICATIONS: Schiffrin Barroway Files NY Securities Suit -------------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action on behalf of purchasers of the common stock of Metawave Communications Corporation (NASDAQ:MTWV) between April 26, 2000 and December 6, 2000, inclusive. The action is pending in the United States District Court, Southern District of New York against the Company, 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. In April 2000, the Company commenced an initial public offering of 6,250,000 of its shares of common stock at an offering price of $9 per share. In connection therewith, the Company filed a registration statement, which incorporated a prospectus that 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 Company shares issued in connection with the IPO; and (2) 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 further information, contact Marc A. Topaz or Stuart L. Berman 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 by E-mail: info@sbclasslaw.com or visit the firm's Website: www.sbclasslaw.com MORGAN STANLEY: Court's Response To NY Fraud Suit Appeal Still Pending ---------------------------------------------------------------------- Plaintiffs in the consolidated class action suit against several Morgan Stanley limited partnerships are still waiting for the New York Appellate Court to rule on their appeal. Several class actions were commenced in September 1996 in the Supreme Court of the State of New York, New York County, on behalf of all purchasers of interests in limited partnership commodity pools sold by Morgan Stanley Dean Witter. The suit named several limited partnerships as defendants: (1) Morgan Stanley DW, Inc., (2) Demeter Management Corporation, (3) Dean Witter Futures & Currency Management Inc., (4) Morgan Stanley Dean Witter and Company, (5) Spectrum Select (under its original name, "Dean Witter Select Futures Fund L.P."), (6) certain other limited partnership commodity pools of which Demeter Management Corporation is the general partner, and (7) certain trading advisors to the above limited partnership pools. The suits were later ordered consolidated and an amended complaint in was filed in August 1997, alleging that the defendants committed the following in the sale and operation of the commodity pools: (i) fraud, (ii) breach of fiduciary duty, and (iii) negligent misrepresentation The court dismissed the suit in November 1998, but granted plaintiffs leave to file an amended complaint, which they did in early December 1998. In December 1999, the court dismissed the case with prejudice - a decision that the plaintiffs promptly appealed. NEBRASKA: Judge Says Cap Doesn't Apply To Children Of Disabled Mothers ---------------------------------------------------------------------- Lancaster County District Court Judge Paul Merritt, in Nebraska, recently ruled that the "family cap" on welfare benefits does not apply to the children of disabled mothers, the Omaha World-Herald recent reported. The ruling could affect up to 1,000 children, making them eligible for retroactive benefits. Three, low-income disabled mothers filed a class action opposing the state's welfare reform law, which went into effect in 1997, put a "family cap" on benefits. Families with children born 10 months or more after the family started receiving welfare no longer could receive a $71 increase in monthly benefits for each additional child. According to the Nebraska Health and Human Services System, that provision includes disabled mothers. The suit argues that the Legislature intended the "family cap" to apply only to welfare recipients who can work. Judge Merritt wrote, in his ruling, that self-sufficiency was the purpose of the welfare act's "family cap," which was intended to discourage large families, thereby enabling a physically capable woman to go out to work. Interpreting the law as applicable to those who cannot be self- sufficient defeats the purpose of the legislation, the judge said. A spokeswoman for Health and Human Services declined to comment, saying the department's lawyer had not had a chance to study the ruling. Milo Mumgaard, director of the Nebraska Appleseed Center for Law in the Public Interest, which had filed and argued the lawsuit for the families, said the law had been applied to the wrong families. He expects the state to appeal, but added that he wants a state official to proceed with the payments- $71 per month fulfills a lot of basic care and diaper needs. NEW YORK: Judge Grants Class Certification To Insurance Fraud Suit ------------------------------------------------------------------ Federal Judge Bruce Kauffman allowed the lawsuit filed against New York Life Insurance Company by its current and former employees to proceed as a class action. Kauffman ruled that the number of employees with cases against the Company was too numerous to try individually. He, however, reserved judgment on the merits of the case. The suit alleges that the Company improperly used worker pensions and 401(k) funds in the late 1990s as capital for a new mutual fund named Mainstay Institutional Funds. The suit, filed on behalf of almost 50,000 workers, also claims the Company charged excessive fees and failed to move employee assets elsewhere when the funds performed poorly. The Company has denied the allegations, calling the suit "opportunistic." Vice President William Werfelman said that the pension fund now boasts a $900 million surplus, compared with $25 million a decade ago and its financial performance is "extraordinarily healthy"' and in line with industry averages. NEXTCARD INC.: Cauley Geller Commences Securities Suit in N.D. CA ----------------------------------------------------------------- Cauley Geller Bowman & Coates LLP initiated a securities class action on behalf of purchasers of NextCard Inc. (NASDAQ:NXCD) publicly traded securities during the period between March 30, 2000 and October 30, 2001, inclusive. The suit, filed in the United States District Court for the Northern District of California, charges the Company and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The suit alleges that defendants disseminated false and misleading statements concerning the Company's operations and prospects for 2000 and 2001. In fact defendants knew the Company'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 Company stock, Company insiders sold almost $9 million worth of their own 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 the Company's portfolio, the Company would need to dramatically increase its reserves for loan losses in fiscal 2000 and in the first, second and third quarters in 2001 and as result its reported value of its loans for the period 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 ration had plummeted below acceptable levels, it had been technically subject to a Prompt Correction Action Order and thereby restricted from accepting or reviewing any brokered 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 Company 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. For further details, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 (toll-free) by E-mail: info@classlawyer.com or visit the firm's Website: www.classlawyer.com PASADENA SCHOOLS: Agrees To Settle Illegal Student Fees Suit For $227T ---------------------------------------------------------------------- The Pasadena Unified School District (PUSD) will settle a student fees class action suit pending in the Pasadena Superior Court for $227,798. Three parents who paid illegally charged fees for certain school activities filed the suit, which applies to fees that were paid between 1998 and 2001. Under the settlement, claimants could receive from $5 to more than $1,000. Claimants for the suit could reach up to 30,000, according to PUSD attorney, Dana McCune. The settlement will also cover the claims and pay for half of the parents' legal fees, which could reach $75,000. If there's money left over, the district will have to put it back into the programs that had been sustained by illegal fees. The district will pay for the other half of parents' legal fees with other money. Plaintiff Rene Amy hailed the settlement saying that it was a step towards ensuring free education for economically disadvantaged students. "What it means for PUSD students is that hopefully never again will they be faced with these fees, which can be anything from minor irritants to real budget busters," Amy told the Pasadena Star News in an interview. District spokesman Erik Nasarenko also expressed satisfaction with the settlement while board member Ed Honowitz said the settlement sends a message that the district follows the law. However, Honowitz says "The unfortunate part is we may not be able to offer programs that we offered to (students) before." Parties in the suit will meet with Superior Court Judge Ann Kough on November 14 to review the settlement. PEROT SYSTEMS: Denies S.D. New York Securities Suits' Accusations ----------------------------------------------------------------- Perot Systems Corporation labeled "without merit" several securities suits pending against them in the United States District Court for the Southern District of New York. The suits commenced in July and August 2001 against the Company, certain of its current and former officers and certain investment banks. The suits uniformly allege violations of Rule 10b-5, promulgated under the Securities Exchange Act of 1934, as amended, and Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, as amended. The suits allege improper practices by the investment banks in connection with the Company's initial public offering in February 1999. Specifically, the suits assert that certain investment banks, in exchange for allocations of public offering shares to their customers, received undisclosed commissions from their customers on the purchase of securities. These banks required their customers to purchase additional shares of the Company in aftermarket trading. The lawsuits also allege that the Company should have disclosed in its public offering prospectus the alleged practices of the investment banks, whether or not the Company was aware that the practices were occurring. The Company believes it is part of the trend of securities suits against companies who have issued initial public offerings in the past two years. The Company also expressed confidence that the suit will not have a material adverse effect on its financial condition, results of operation or cash flow. PROVIDIAN FINANCIAL: Wolf Haldenstein Files Securities Suit in N.D. CA ---------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP commenced a securities class action on behalf of all purchasers of Providian Financial Corp. (NYSE: PVN) securities between June 6, 2001 and October 18, 2001. The suit was filed in the United States District Court for the Northern District of California against the Company and: (1) Shailesh J. Mehta, Chairman of the Board of Directors, President and Chief Executive Officer, (2) David J. Alvarez, Vice Chairman, (3) James H. Rowe, Executive Vice President and Chief Financial Officer, and (4) J. David Grissom, Director The complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, promulgated thereunder. Providian allegedly issued materially false and misleading statements to the investing public about the Company's balance sheet and financial results, and about prospects for the second and third quarters of 2001. The Company also allegedly concealed material facts regarding the its changes in policy and procedure for the extension of credit to sub- prime lenders, and for writing-off receivables for customers that filed for bankruptcy protection. Providian is one of the largest Visa and MasterCard issuers in the United States, having grown rapidly by issuing credit cards primarily to "sub-prime" borrowers, those with either limited or poor credit histories. This business model worked exceptionally well during economic boom times, when riskier sub-prime borrowers were able to service credit- card debt. Specifically, the complaint alleges that during the Second Quarter of 2001, amid industry-wide concerns about the quality of credit held by card issuers, the Company guided the investing public that a key metric of credit quality would be less than 10%. The "managed net charge-off rate," which for the Second Quarter of 2000 had been 7.6%, was expected to be 9.5% to 10% for the Second Quarter of 2001. In late June 2001, it became apparent to insiders that the charge-off rate would far exceed their guidance. To control the impact of the news, without public disclosure, the Company changed its policy for reporting cardholder bankruptcies in a way that pushed nearly two weeks of bankruptcies from the Second to the Third Quarter, lowering the charge-off rate by 40 basis points. Providian changed from a policy and practice of immediately writing-off receivables upon receipt of electronic notification that customers had filed for bankruptcy protection to a policy and practice of accumulating or "batching" bankruptcy notifications and then writing- off those receivables once per month. The complaint further alleges that as a result of this change, which was inconsistent with industry practice and defendants' prior representations to analysts, roughly $30 million in charge-offs were pushed out of the second quarter and into the third quarter of 2001. Defendants were thus able to lower by four tenths of one percent the Company's second quarter managed net charge-off rate, a critical metric in determining the credit quality of a credit-card lender, especially one which primarily lent to riskier sub-prime borrowers. The change in bankruptcy reporting reduced the charge-off rate to 10.3%, and boosting the Company's reported earnings per share by $. 06. Without this accounting change, Providian's loss rate would have been 10.7%, well above defendant's prior guidance of 9.5% to 10%. On October 18, 2001, defendants revealed that the Company's earnings per share for the third quarter of 2001 were substantially lower than what they had previously led the market to believe. In the wake of this news release, the price of Providian stock fell to $5.15 per share -- more than 90% below the class period high of $59.80 per share. During the class period, defendants Alvarez, Rowe, Grissom and Mehta sold roughly $25 million worth of their stock at prices that were artificially inflated as high as $50.00 per share. For more information, contact George Peters, Derek Behnke, Thomas H. Burt or Fred Taylor Isquith 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 Providian. SIRIUS SATELLITE: Schiffrin Barroway Commences VT Securities Suit ----------------------------------------------------------------- Schiffrin and Barroway LLP initiated a securities class action on behalf of all purchasers of Sirius Satellite Radio, Inc. (NASDAQ:SIRI) common stock from February 17, 2000 through April 2, 2001, inclusive. The suit, pending in the United States District Court for the District of Vermont, charges the Company and certain of its officers and directors with violating the federal securities laws. The defendants allegedly failed to disclose facts know to them, or recklessly disregarded by them, which demonstrated that the announced commercial launch dates for the Company's satellites required for the its service were impossibly ambitious. Defendants knew, or recklessly disregarded, that it would be possible for the Company to offer its service commercially by the end of 2000, as initially disclosed, or early in 2001, as subsequently disclosed. The Complaint alleges that at all times the defendants issued materially false and misleading statements and press releases concerning when the its service would be commercially available. These misstatements caused the market price of Company stock to be artificially inflated. For further details, contact Marc A. Topaz or Stuart L. Berman 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 by E-mail: info@sbclasslaw.com or visit the firm's Website: www.sbclasslaw.com SIRIUS SATELLITE: Cauley Geller Initiates Securities Suit in Vermont -------------------------------------------------------------------- Cauley Geller Bowman & Coates LLP commenced a securities class action on behalf of purchasers of Sirius Satellite Radio, Inc. (NASDAQ:SIRI) common stock during the period between February 17, 2000 and April 2, 2001, inclusive. The suit, filed in the United States District Court for the District of Vermont, charges the Company and certain of its officers and directors with violating the federal securities laws. The defendants allegedly failed to disclose facts known to them, or recklessly disregarded by them, which demonstrated that the announced commercial launch dates for the Company's satellites required for the its service, were impossibly ambitious. Defendants knew, or recklessly disregarded, that it would be possible for the Company to offer its service commercially by the end of 2000, as initially disclosed, or early in 2001, as subsequently disclosed. The complaint alleges that at all times the defendants issued materially false and misleading statements and press releases concerning when the Company's service would be commercially available, which caused the market price of Company common stock to be artificially inflated. When the truth about the Company's business was revealed to the public, the price of its common stock dropped precipitously. For more information, contact Jackie Addison, Sue Null or Shelly Nicholson by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 by E-mail: info@classlawyer.com or visit the firm's Website: www.classlawyer.com TALISMAN ENERGY: Faces $1B Suit Protesting South Sudan Oil Operations --------------------------------------------------------------------- Canadian oil company Talisman Energy (Toronto: TLM.TO) faces a $1 billion class action filed by a U.S. anti-slavery group in the U.S. District Court for the Southern District of New York. The American Anti-Slavery Group charges the Company with violating "international law for participating in the ethnic cleansing of black and non-Muslim Minorities in southern Sudan." The Company holds a 25% stake in Sudan's only major oil-producing project, which pumps out more than 200,000 barrels of oil a day. International human rights organizations and church groups have severely criticized the Company, whose operations, they say, helps fund Sudan's Khartoum government's civil war against Christian and tribal rebels south of the impoverished country. The suit further alleges, "Talisman, in an effort to protect its oil fields in Sudan, aided and abetted the fundamentalist Islamic government in its ongoing and self-proclaimed `jihad' - a campaign that has resulted in massive civilian displacement; the burning of villages, churches and crops; and the murder and enslavement of innocent civilians." Board member and attorney Carey D'Avino, and another lawyer, Stephen Whinston filed the suit on behalf of plaintiffs that include the Presbyterian Church of Sudan and two individuals. Talisman was not immediately available for comment. However, CEO Jim Buckee has maintained that the firm was improving the situation by aiding economic development and initiating community projects as building schools, hospitals and roads. He has asserted that the Company was doing all it could to convince the Sudanese government to improve its human rights record. Earlier this year the U.S. Congress proposed legislation that would ban companies operating in Sudan from being listed on stock markets in the United States. It has since halted the proposal. TERADYNE INC.: Stull Stull Commences Securities Suit in Massachusetts --------------------------------------------------------------------- Stull Stull and Brody initiated a securities class action on behalf of purchasers of the common stock of Teradyne, Inc. (NYSE:TER) from between July 14, 2000 and October 17, 2000, inclusive. The suit is pending in the United States District Court for the District of Massachusetts against the Company, George Chamillard and Michael A. Bradley. The complaint alleges that defendants violated 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 July 14, 2000 and October 17, 2000, thereby artificially inflating the price of the Company's common stock. The complaint alleges Teradyne was experiencing declining orders in its semiconductors testing systems division, which would cause the Company's growth rate to slow from historical levels. Defendants concealed this adverse fact from investors, so that the Company could complete the acquisition of Herco Technology Corporation and Perception Laminates, Inc., d/b/a Synthane Taylor, using artificially inflated common stock as currency. When the truth about Teradyne's business was revealed to the public, the price of the Company's common stock dropped precipitously. For more information, contact Tzivia Brody by Phone: 1-800-337-4983 or E-mail: SSBNY@aol.com by Fax: 212/490-2022 or by Mail: 6 East 45th Street, New York, NY 10017. TEXTRON/LYCOMING: Moves To Close Malibu Mirage Aircraft Suit Website -------------------------------------------------------------------- Dallas attorney Fred Misko, Jr., today charged Textron/Lycoming and The New Piper Aircraft, Inc., makers of the Malibu Mirage aircraft that are the focus of pending class action litigation, with trying to deny Mirage owners the full use of their aircraft. Misko also accused the two companies of attempting to deny Mirage owners access to information about the lawsuit, and ultimately seeking to abridge the owners' rights to free speech and communication with their lawyers. Calling the motions filed by Textron and New Piper "an attempt to quash legitimate customer complaints," Misko today asked a United States District Court to allow his firm to leave in place a web site featuring information about the case. "The motions filed by Textron and New Piper are blatant attempts to deny their customers the right to legal counsel or the opportunity even to access information so they can decide for themselves whether they want to seek redress," said Misko. He added, "With our response to the motions, we are attempting to preserve the rights of some 1,200-1,500 current and former owners of Malibu Mirage aircraft nationwide to seek compensation for a significant loss in market value of their aircraft." In September, 2000, Misko filed a class action lawsuit against Textron/Lycoming and New Piper on behalf of current and former owners of Malibu Mirage aircraft nationwide. Filed in U.S. District Court, Southern District of Florida, the lawsuit alleges claims under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA) for misrepresentations and wrongdoings by Textron/Lycoming and New Piper related to the TIO-540-AE2A engine. In October 2001, Misko established a web site, www.TextronEngineLitigation.com, to allow current and former owners of Piper Malibu Mirage aircraft to access comprehensive information about the class action lawsuit and to provide a vehicle for them to ask questions and offer comments. When the two Companies became aware of the web site's existence, they filed motions asking the Court to: (1) shut down the web site in its current form; (2) to disqualify Fred Misko, Jr., and another lawyer with his firm, Charles Ames, as Plaintiffs' counsel in the class action; and (3) to limit communications between the law firm and Mirage owners. Misko and Ames responded by asking the Court to deny the motions in their entirety and states that there is no support for any of the claims contained in the motions. "The motions misstate the applicable law regarding communications with class members and, more importantly, seriously misrepresent the actual facts surrounding this issue," the response reads. Misko said that neither the plaintiffs' class representative in the case, William S. Montgomery, Jr., or his counsel have violated any rules of the State Bar of Florida and have not acted inappropriately in providing information to absent, potential class members. Both the motions filed by Textron and New Piper, as well as Misko's response, are available to the public on the web site. According to the lawsuit, Textron and New Piper touted the TIO-540-AE2A engine as the "strongest, most reliable six cylinder engine in general aviation" and specifically represented that the engine had a 2,000-hour TBO (Time Between Overhaul). In actual use, the lawsuit alleges, Mirage owners have experienced consistently premature failures that have required engine overhaul or replacement at one-third or less than the service life published by the manufacturers. After twelve years of production, Textron/Lycoming admitted in a Mandatory Service Advisory issued more than a year ago that a safety of flight risk exists with these aircraft. The lawsuit contends that all of the owners in this class have been damaged by Textron/Lycoming's and New Piper's concealing information and making serious misrepresentations regarding the engine's 2000-hour TBO service life and reliability. Under the terms of a settlement proposal submitted by Misko, Mirage owners could receive significant compensation for the loss in market value of their aircraft. "Clearly, the purpose of Textron's and New Piper's motions is to shut down a legitimate form of communication between Mirage owners and attorneys representing class members in this lawsuit," said Misko. "The Internet web site is merely an open line of communications via the Internet that makes it convenient for Mirage owners and other interested parties to view actual court documents and make informed decisions about the case, as is their right." UNISYS CORPORATION: Fairness Hearing For Settlement Set For Dec. 2001 --------------------------------------------------------------------- The U.S. District Court for the Eastern District of Pennsylvania has set for December 5,2001 the fairness hearing for the agreement proposed by Unisys Corporation to settle the securities class action against them. The suit, filed on behalf of persons who acquired the Company's common stock during the period May 4, 1999 through October 14, 1999, alleges allege violations of federal securities laws in connection with statements made by the Company concerning certain of its services contracts. The hearing will determine: (1) whether the proposed settlement of the suit for $5,750,000 in cash plus accrued interest should be approved by the Court as fair, reasonable, and adequate; (2) whether the application of plaintiffs' counsel for an award of attorneys' fees and reimbursement of expenses should be approved; and (3) whether the action should be dismissed with prejudice. USINTERNETWORKING INC.: Finkelstein Thompson Lodges Suit in S.D. NY ------------------------------------------------------------------- Finkelstein Thompson & Loughran commenced a securities class action on behalf of purchasers of the securities of USinternetworking, Inc (NASDAQ:USIX) between April 9,1999 and December 6,2000, inclusive. The suit was filed in the United States District Court for the Southern District of New York against the Company and its underwriter Credit Suisse First Boston for illegally misleading investors. The complaint charges defendants with violations of Sections 11 of the Securities Act of 1933. The complaint alleges that the prospectus was materially false and misleading because it contained material misrepresentations and omissions about: (1) the agreements with customers whereby Credit Suisse First Boston had solicited and received excessive and undisclosed commissions in exchange for an allocation of the Company's shares issued in connection with the initial public offering; and (2) Credit Suisse First Boston had entered into agreements with customers whereby Credit Suisse First Boston would allocate Company shares issued in connection with the initial public offering in exchange for which the customers agreed to purchase additional Company shares in the aftermarket at pre- determined prices. For more details, contact Andrew J. Morganti by E-mail: ajm@ftllaw.com UTSTARCOM INC.: States It Expects Similar Securities Suits In Future -------------------------------------------------------------------- UTStarcom, Inc. (NASDAQ:UTSI) believes it has meritorious defenses to a securities class action pending in the United States District Court for the Southern District of New York. The suit was filed on behalf of purchasers of the Company's securities between March 2, 2000 and December 6, 2000, inclusive, against the Company, 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. Last March 2000, the Company commenced an initial public offering of 10 million of its shares of common stock, at an offering price of $18 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: (1) the underwriters on the offering 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 IPO; and (2) the underwriters had entered into agreements with customers whereby the underwriters 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. The Company expects additional similar cases will be filed in the coming months. WASTE MANAGEMENT: Concedes To $457M TX Securities Suit Settlement ----------------------------------------------------------------- Waste Management Inc. (WMI) agreed to settle for $457 million the securities class action pending in the U.S. District Court for the Southern District of Texas. The suit arose when its stock price collapsed in 1999 after an accounting scandal that caused the Company to restate financial results for several quarters. As a result, the Company's stock price dropped from more than $56 to $13. The Company also fired its top management and began selling off some non-core businesses acquired during expansion. More than 30 suits were filed against the Company and certain of its current and former officers and directors, after the scandal and were later consolidated into a single action. The suit was filed on behalf of all purchasers of Company securities (including common stock, debentures and call options), and all sellers of put options, from June 11, 1998 through November 9, 1999. The Company said the settlement is still subject to additional discovery by the plaintiffs and court approval. The Company also revealed that accounting firm Arthur Andersen LLC would pay it $20 million to settle a related malpractice suit. ********* 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. 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 240/629-3300. * * * End of Transmission * * *