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/raid1/www/Hosts/bankrupt/CAR_Public/020123.mbx C L A S S A C T I O N R E P O R T E R Wednesday, January 23, 2002, Vol. 4, No. 16 Headlines AIR TRANSAT: Number of Emergency Landing Suit Participants Reaches 200 ANTHRAX VACCINES: Disturbing Study Results Halt Vaccination Program ANTITRUST LAWS: Bush Admin Reorganizes Handling of Antitrust Suits AT&T CORPORATION: Court Throws Out Arbitration To Resolve Disputes BAYER AG: More Trouble for German Drug Maker as Baycol Deaths Rise COLEMANS FOOD: Recalls Smoked Trout Due to C. Botulinum Contamination COOPERATIVE D'ALENTOUR: Recalls Raisins Due to Undeclared Sulphites EARTHLINK INC.: California State Court Refuses To Dismiss Consumer Suit EDDIE BAUER: Recalls Stainless Steel Lunch Bottles For Burn Hazard GRIMM'S FINE: Undeclared Milk Protein Forces Recall of Sizzlin' Smokies INTERMATIC INC.: Recalls Nightlights For Potential Shock, Burn Hazards KNIGHTS OF COLUMBUS: Offers To Settle Insurance Fraud Suit in Illinois MISSISSIPPI: State's Joinder Rules Allow Double, Triple Jeopardy MOLINARO'S FINE: Undeclared Milk Protein Forces Ravioli Recall MULTI-MARQUES: Recalls Sliced White Bread Due to Undeclared Soy Protein NEW JERSEY: Jurors Investigate Park Allegedly Causing Homes To Flood OREGON: Suit Withdrawn After Defendants' Plan To File Anti-SLAPP Suit REGENCE BLUE: WA Suit File Over Limited Women's Contraceptive Coverage TAK TAI: Palm Juice Products Sold in B.C., Alberta Being Recalled TEXAS: Supreme Court Allows Environmental Suit Discovery To Proceed THIMEROSAL LITIGATION: Federal Court Remands Suit To Oregon State Court Securities Fraud ARTHUR ANDERSEN: Petroleum Firm Sues For Involvement in Enron Collapse CROSSWORLDS SOFTWARE: Shareholders Sue To Block IBM Corportion Merger CUMULUS MEDIA: April Securities Suit Settlement Hearing Scheduled ENRON CORPORATION: Lawyers Allege Destruction of Vital Documents EXFO ELECTRO: Disputes Investors Claims in Securities Suit in NY FINISAR CORPORATION: Sued For Securities Act Violations in S.D. NY IMCLONE SYSTEMS: House Panel Commences Inquiry into Erbitux Disclosures LIBERTY MEDIA: Shareholders Sue To Block Merger With Liberty Digital LITTLE SWITZERLAND: Delaware Court Approves $1.5M Settlement WESTERN SAVINGS: Settling Securities Suits in Arizona Federal Court ********* AIR TRANSAT: Number of Emergency Landing Suit Participants Reaches 200 ---------------------------------------------------------------------- There are now 200 plaintiffs in the class action against Canadian airline Air Transat, Antonio Azevedo, plaintiffs' attorney said recently, according to according to a report by The Globe and Mail. The lawsuit alleges the plaintiffs suffered psychological trauma when an Air Transat Airbus A330 ran out of fuel in the mid-Atlantic and made an emergency landing in the Azores. The flight carried 291 passengers. Mr. Azevedo said that his clients desire to widen the lawsuit's scope to include aircraft manufacturer, Airbus Industrie as a defendant. A court hearing on the motion to certify the passengers as a class will take place in the spring, he added. ANTHRAX VACCINES: Disturbing Study Results Halt Vaccination Program ------------------------------------------------------------------- The US Department of Defense has halted its program to protect military forces from the deadly anthrax virus, after a study by the Navy Bureau of Medicine and Surgery reported that an anti-anthrax vaccine could lead to birth defects in babies. Dr. William Winkenwerder, Jr., Assistant Secretary of Defense for Health Affairs, released a memo last week, asking the Army, Navy, Air Force and Marines to develop a plan within two weeks to ensure that pregnant servicewomen do not get the vaccinations in the meantime, according to an Associated Press report. Bureau official, Lt. JG Mike Kafka said the study may have used faulty data and ordered a review, but the Department clearly isn't taking anymore chances. Dr. Winkenwerder has asked the services to devise a way to enhance the screening of women of childbearing age, "potentially including pregnancy testing," to prevent pregnant women from getting the vaccine. Throughout the program, health care workers were supposed to avoid vaccinating expectant mothers, but it was not clear whether the workers failed to ask the women or whether the women did not know they were pregnant. Findlaw.com reports that the study indicated that some women might have gotten the vaccination after their first trimester, by which time they would probably have known they were pregnant. The Pentagon is not releasing details on the study while the review is under way, Mr. Kafka said. The program was instituted in 1998, when US troops were deployed to South Korea and the Middle East to protect them from anthrax bacteria that, when inhaled, can cause death within a few days. A small number of soldiers, dubious about the vaccine's safety, have refused to get them and faced legal or disciplinary action. Some troops with symptoms of the Gulf War syndrome said the vaccine might have caused their conditions. Scientists have contested that claim. ANTITRUST LAWS: Bush Admin Reorganizes Handling of Antitrust Suits ------------------------------------------------------------------ The Bush Administration is reorganizing how it enforces antitrust laws by assigning specific cases to the Justice Department and the Federal Trade Commission. The goal is to prevent the reoccurrence of situations in which both agencies have competed against each other during investigations' management. Under the plan, the Department of Justice will be responsible for reviewing all mergers involving Internet, software, telecommunications and entertainment companies. The Federal Trade Commission (FTC) will have approval authority for other industries, such as health care, oil, natural gas, electric power, computer hardware and biotechnology companies, according to a Findlaw.com report. The decision will also make the Justice Department responsible for companies in these businesses: cable, publishing, toys, games, television, radio, newspapers, movies, advertising and music. The reorganization changes six years of precedent policy and is deemed important to corporate America because some experts believe the FTC is more independent and less susceptible to political influence, according to Findlaw.com. There has been no comment from either agency regarding the matter. AT&T CORPORATION: Court Throws Out Arbitration To Resolve Disputes ------------------------------------------------------------------ A federal judge in San Francisco, US Magistrate Judge Bernard Zimmerman, strongly criticized AT&T Corporation's private system of resolving disputes as an "illegal and unconscionable" attempt to deprive telephone customers of their legal rights, the Associated Press recently reported. Binding arbitration is a quasi-legal process of resolving disputes without laws, juries or constitutional rights, according to Judge Zimmerman. He ruled that the AT&T's arbitration system puts long- distance customers at a disadvantage, striking down the Company's attempt to impose rules on California customers that would have: (1) barred them from joining in class actions; (2) limited damages for fraud and other intentional wrongdoing; and (3) made filing complaints in certain other cases prohibitively expensive. "It's not just that AT&T wants to litigate in the forum of its choice.. arbitration," Judge Zimmerman wrote. "It is that AT&T wants to make it very difficult for anyone to effectively vindicate her rights, even in that forum." Judge Zimmerman's decision came a day after the US Supreme Court ruled that an arbitration agreement could not block a federal agency from seeking damages in court for victims of employment discrimination. Taken together, the cases indicate a potential shift in the consistent support from federal courts for corporate policies that force employees, stockholders, patients and other consumers into binding arbitration. Company spokesman, Gordon Diamond said that binding arbitration is a quick and convenient way to resolve disputes, and that AT&T settles the overwhelming majority of its disputes over the telephone. "This is a process that's widely used in the wireless industry, the credit card industry, it's not something that's unique to AT&T," he said. The Company plans to appeal the decision. BAYER AG: More Trouble for German Drug Maker as Baycol Deaths Rise ------------------------------------------------------------------ German pharmaceutical giant, Bayer AG, disclosed in latest regulatory filing that Baycol-related deaths have risen to more than a hundred since last August, fueling talk of more suits ahead. Already facing several class actions in the United States, a German lawyer, who The Times did not name in its report, is preparing to lodge his own class action, representing 2,000 German users of Baycol. The suit, which will also name GlaxoSmithKline as co-defendant, will be filed in the United States. The attorney cited a history of large damage payments in the US compared to Europe, the report says. Analysts predict litigation expenses for the embattled German drug maker could reach US$10 billion. In August last year, when the company pegged deaths at 52 worldwide, litigation cost was estimated to reach less than US$5 billion. These latest figures surfaced in company documents filed with the US Securities and Exchange Commission ahead of its listing in the New York Stock Exchange this Thursday. COLEMANS FOOD: Recalls Smoked Trout Due to C. Botulinum Contamination --------------------------------------------------------------------- The Canadian Food Inspection Agency and Colemans Food Centre Ltd. are warning the public not to consume Colemans Food Centre brand vacuum packed Smoked Trout. It is possible that this product may support the growth of bacteria responsible for botulism in humans. The Company is voluntarily recalling this product, which was sold only in Newfoundland. Colemans Food Centre Ltd. stores sell the affected product under the following names: Trout Locally Smoked, Smoked Trout Fillets and Smoked Trout. All "Pkgd. On" codes are affected by this alert. Foods contaminated with C. botulinum may not look or smell spoiled. Botulism is a life-threatening illness caused by toxins produced by Clostridium botulinum bacteria. Consumers should dispose of the remaining product immediately or return products to the point of purchase for a refund. There have been no reported illnesses associated with the consumption of this product. For more information, contact Fred Jamieson (English) of the Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613- 760-4376 or Linda Leblanc (French) by Phone: 613-760-4112 COOPERATIVE D'ALENTOUR: Recalls Raisins Due to Undeclared Sulphites ------------------------------------------------------------------- The Canadian Food Inspection Agency is warning consumers with allergies to sulphites not to consume Golden Raisins labeled as "FRUITS SECHES raisin dor," distributed by Cooperative D'Alentour. This product may contain sulphites that are not declared on the label. Cooperative D'Alentour is voluntarily recalling the affected product from the marketplace. This product was sold in Quebec. The affected product is sold in 1 kg and 5 kg package sizes. All packages that do not clearly mention the presence of sulphites are affected by this alert. Consumption of this product may cause a serious or life-threatening reaction in persons with allergies to sulphites. There have been no reported illnesses associated with the consumption of this product. For more information, contact Davendra Sharma (English) of the Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613- 755-2890 or Brian Radey (French) by Phone: 613-755-3324 EARTHLINK INC.: California State Court Refuses To Dismiss Consumer Suit ----------------------------------------------------------------------- The California Superior Court refused to dismiss a class action against Earthlink, Inc., alleging the Company violated the Consumer Legal Remedies Act and the Unfair Business Practices Act by providing inadequate DSL service to consumers throughout California. Specifically, the suit alleges that the Company did not construct a telecommunication infrastructure sufficient to meet demand for its DSL service. As a result, it was unable to provide the degree of DSL service performance capabilities and attributes that it marketed and advertised. In a seven-page ruling, the Court stated that, "plaintiff has alleged sufficient facts to support the claims for unfair business practices and deceptive practices, both of which are based on allegations that defendant fraudulently misrepresented that it had sufficient DSL service capabilities to be able to provide the promised fast hook-up and access to the Internet." For more information, contact Marc L. Godino of Stull Stull and Brody by Phone: 888-388-4605 by E-mail: mgodino@secfraud.com or visit the firm's Website: http://www.secfraud.com EDDIE BAUER: Recalls Stainless Steel Lunch Bottles For Burn Hazard ------------------------------------------------------------------ Eddie Bauer Outlet Stores is cooperating with the US Consumer Product Safety Commission (CPSC) by voluntarily recalling about 4,000 stainless steel lunch bottles. The insulated bottles have a weak seal and can leak hot liquids. This poses a serious burn hazard to consumers. The Company has received four reports of the insulated bottles leaking, though no injuries have been reported. The recalled Wide Mouth Lunch Bottles are 32 oz. stainless steel containers, with a black base and handle, a black carrying strap, and a two-piece lid, including a drinking cup. The insulated bottles have the words "Eddie Bauer" written on one side of the container located 1 3/4 inches from the lower edge of the plastic collar, and a label that reads "Eddie Bauer Wide Mouth Lunch Bottle" on the other. On the bottom of the bottle there is a sticker that reads "Made in China." Eddie Bauer outlet stores nationwide sold these insulated bottles from September 2001 through November 2001 for about US$24. Lunch bottles that have the words "Made in Korea" printed on the bottom or have the "Eddie Bauer" signature logo printed 1 1/4 inches from the lower edge of the plastic collar are not part of this recall. For more information, call the Company by Phone: 800-426-6253 between 5 am and 11 pm PT Monday through Sunday or visit the firm's Website: http://www.eddiebaueroutlet.com GRIMM'S FINE: Undeclared Milk Protein Forces Recall of Sizzlin' Smokies ----------------------------------------------------------------------- The Canadian Food Inspection Agency and Grimm's Fine Foods Ltd., Richmond, British Columbia are warning consumers with allergies to milk protein not to consume Grimm's Sizzlin' Bavarian Smokies. The affected product packages may contain Cheese Flavoured Smokies that are not declared on the label. The Company is voluntarily recalling the product, which was distributed in Alberta and British Columbia. The affected product, Grimm's Sizzlin' Bavarian Smokies, is sold in a 450g package. The identification codes "Best Before JA 29" and "EST 226" are stamped on the plastic film. The UPC is 0 55898 15190 7. Consumption of this product may cause a serious or life-threatening reaction in persons with allergies to milk protein. There have been no reported illnesses associated with the consumption of this product. For more information, contact Davendra Sharma (English) of the Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613- 755-2890 or Brian Radey (French) by Phone: 613-755-3324 INTERMATIC INC.: Recalls Nightlights For Potential Shock, Burn Hazards ---------------------------------------------------------------------- Intermatic Inc. is cooperating with the US Consumer Product Safety Commission (CPSC) by voluntarily recalling about 156,000 electroluminescent nightlights. The nightlights can short-circuit, posing shock and burn hazards to consumers. The Company has not received any reports of incidents. This recall is being conducted to prevent the possibility of injury. The recalled Electroluminescent Night Lights have model numbers GN172 and GN165, which are molded on the back of the lights. The model GN172 lights are gray in color and are about 1 1/2 inches square by 1/4 inch thick with two metal electrical prongs. The model GN165 lights are gray in color and are about 4-3/8 inches in height, 1-5/8 inches wide and 1/4 inch thick with two metal electrical prongs. Also molded on the back of the nightlights are the words, "Intermatic Inc." and "Made in Taiwan." Hardware stores and electrical distributors nationwide, including True Value Hardware Stores, sold these nightlights between January 1999 and December 2001 for about US$4. For more information, contact the Company by Mail: 7777 Winn Road, Spring Grove, IL 60081, Attn: Larry Kubisiak or by Phone: 800-391-4555 between 8 am and 4:30 pm CT Monday through Friday. KNIGHTS OF COLUMBUS: Offers To Settle Insurance Fraud Suit in Illinois ---------------------------------------------------------------------- Policyholders of the Knights of Columbus, an insurance company and Roman Catholic fraternal group based in New Haven, Connecticut, have until March 13 to decide whether to accept a settlement to end the class action, filed in Chicago, which charges the Knights with "abusive" sales practices for whole-life insurance policies sold between 1980 and 2000. The court will hold a hearing on May 2 in Chicago to consider objections and a final certification of the settlement, the Philadelphia Inquirer recently reported. The Knights, in the settlement, deny wrongdoing, citing regulatory accolades, such as a 1997 investigation by the Pennsylvania Insurance Department, which found "no evidence that any improprieties occurred in the (Knight's) marketing and sales process." Under the terms of the settlement, the plaintiff policyholders will receive a small three-year accidental-death policy, or a year's free premium, in cases where an arbitrator agrees they were deceived. Under the proposal, the Knights also would pay $2.95 million in legal fees, plus $250,000 in costs, to be split by the four law firms that brought the suit, including Berger & Montague in Philadelphia. MISSISSIPPI: State's Joinder Rules Allow Double, Triple Jeopardy ----------------------------------------------------------------- In September of last year, a jury in Claiborne County, Mississippi, awarded $100 million in compensatory damages to 10 people suing drug maker Johnson & Johnson. The plaintiffs claimed that after using Propulsid, a drug for indigestion, they suffered from a variety of ailments, including anxiety and heart disease, according to a recent report in The Northside Sun. Hazlehurst attorney, Jim Shannon, filed the suit last year, and he is again preparing to file a lawsuit brought by 10 more plaintiffs against Johnson & Johnson over the same drug. Nearly every other state protects corporations from double jeopardy in class actions, ruling that a company can get sued only one time on one issue. Anyone who has been hurt must either join the class action suit or sue alone as an individual. Once the class-action suit is decided, the company cannot be sued again by a group of common plaintiffs. However, in Mississippi, there is no limit to how many times one can put together groups of plaintiffs having common complaints and sue, although individuals are protected by the constitution against double jeopardy in criminal cases. The State allows unlimited use of joinder lawsuits in which several plaintiffs can join together to sue somebody without having to go through class action procedures. According to The Northside Sun, Supreme Court Justice Bill Waller said, "I don't think I know of any other state in the country that is as liberal as Mississippi in allowing these types of joinder lawsuits." Justice Waller was one of four Supreme Court justices who voted against joinder lawsuits in American Bankers versus Alexander in February of 2001. He wrote the dissenting opinion and tried to stop the legal precedent that opened the lawsuit floodgates. Justice Jim Smith, Justice Mike Mills and Justice Kay Cobb voted with Justice Waller. Chief Justice Ed Pitman, Justice Oliver Diaz, Justice Chuck McRae, Justice Fred Banks and Justice Chuck Easley exercised pro-joinder votes. According to the Northside Sun, the existence of joinder lawsuits is the reason one sees the ads seeking plaintiffs, asking that the reader call a certain number if he or she has used any one of such drugs as Fen-Phen, Redux, Pondimum. Each call can turn into thousands of dollars, because in Mississippi, attorneys can group 10 or 20 plaintiffs together and then negotiate large settlements. The Legislature's failure to adopt statutes providing instead for class action lawsuits in Mississippi, according to The Northside Sun, resulted in doubled, or even tripled legal jeopardy for a company. Such a situation gives Mississippi a "black eye" among industrial recruiters and insurance companies. MOLINARO'S FINE: Undeclared Milk Protein Forces Ravioli Recall -------------------------------------------------------------- Molinaro's Fine Italian Foods, Ltd. is coordinating with the Canadian Food Inspection Agency in recalling Monlinaro's Brand Ravioli with Meat after and undeclared milk protein could harm consumers with allergies to milk protein. Consumption of this product may cause a serious or life-threatening reaction in persons with allergies to milk protein. There have been no reported illnesses associated with the consumption of this product. The affected product, Molinaro's Brand Ravioli with Meat is sold in 454g size packages. The product code 340 1 and establishment code "CANADA 290| are identified on the label. The UPC is 7 72032 24015 9. The product is distributed in Ontario. The Agency is monitoring the effectiveness of the recall. For more details, contact the Company by Phone: 905-275-7400 (ext. 26) or 1-800- 268-4959 or contact Davendra Sharma (English), Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613-760-4232 or Brian Radey (French), Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613-755-3324 MULTI-MARQUES: Recalls Sliced White Bread Due to Undeclared Soy Protein ----------------------------------------------------------------------- The Canadian Food Inspection Agency is warning consumers with allergies to soy protein not to consume March, Metro Giroux brand sliced enriched white bread as soy flour is not declared on the label. The Company is recalling the product, which is sold in Rouyn-Noranda, Quebec. The March, Metro Giroux Sliced Enriched White Bread is sold in a 450 g bag with UPC 0 67431 01506 5. All best before dates are considered affected. The affected packages list that this product is made for La Boulangerie Norbec Lt,e, Amos, Quebec. The consumption of this product may cause a serious or life-threatening reaction in persons with allergies to soy protein. There have been no reported illnesses associated with the consumption of this product. For more information, contact D. D. Sharma (English) of the Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613- 755-2890 or Brian Radey (French) by Phone: 613-755-3324 NEW JERSEY: Jurors Investigate Park Allegedly Causing Homes To Flood -------------------------------------------------------------------- Jurors recently toured a Bound Brook, New Jersey park, which nearby property owners contend is illegally fortified with landfill that exacerbates flooding in their homes, according to Newark, New Jersey publication, The Star-Ledger. The jury of five men and three women personally inspected Billian-Legion Park off East Main Street in the town of Bound Brook to familiarize themselves with the details of the case they are deciding in State Superior Court Judge Rosemarie Ruggiero-Williams' courtroom, in Somerville. A class action against Bound Brook, brought by 150 property owners in the eastside park neighborhood, contends fill was improperly dumped at the park and along the bank of the Green Brook that forms the boundary to it. The plaintiffs claim the dirt changed the topography of the land and narrowed the waterway's path in a way that increases the potential for flooding in heavy downpours. Jurors also heard defense attorney Chris Piasecki of Middlesex read sworn statements provided to the Court by Michael Picone, a Bridgewater resident, who owns the 20-unit Ashton Arms apartments in Bound Brook and who is a principal plaintiff. In one statement, Mr. Picone testified that he made no observations of the materials brought in or out during the park's evolution from its previous status as a landfill. Mr. Picone was asked whether he ever complained about the construction of the park while the work was going on, but he answered he did not. When asked how many truckloads of dirt were brought onto the site, he testified, "I really don't know." OREGON: Suit Withdrawn After Defendants' Plan To File Anti-SLAPP Suit --------------------------------------------------------------------- The class action lawsuit filed against various environmentalists and a commercial fishing group in Siskiyou County Superior Court in Oregon was withdrawn after the defendants said they would file a countersuit under the Anti-SLAPP statute, which prohibits frivolous lawsuits meant to intimidate defendants. The suit was commenced last August on behalf of widow Georgette Kirby, 74, who owns 80 acres homesteaded by her father, and neighboring farmers. The suit sought to force the defendants to pay damages to Klamath Basin farmers who were denied water last summer. Named as defendants were: (1) the Sierra Club, (2) Klamath Forest Alliance, (3) Pacific Coast Federation of Fishermen's Associations, (4) the Golden Gate Audubon Society and (5) the Institute for Fisheries Resources According to an Associated Press report, the lawsuit was commenced after the US Bureau of Reclamation sharply reduced irrigation deliveries to the Klamath Basin Farmers who rely on the Reclamation Project for water, allegedly because of the needs of endangered suckers and threatened coho salmon. Attorney Robert Hannon, who filed the suit, claimed that the defendants wanted to drive down the price of farmland, therefore, they persuaded the government to cut back irrigation water. He told Associated Press he withdrew the lawsuit because it would cost hundreds of thousands of dollars to gather the evidence required. REGENCE BLUE: WA Suit File Over Limited Women's Contraceptive Coverage ---------------------------------------------------------------------- Medical insurer Regence Blue Shield is facing two class action suits in the Federal District Court of Seattle, Washington, the Big Class Action announced in its website recently. "Plaintiffs are prosecuting claims against the company for its refusal to offer women complete coverage, or any coverage in many instances, for their prescription contraceptive needs," the announcement said. Accordingly, the company has unlawfully discriminated and violated insurance and consumer-protection laws by limiting coverage of contraceptives available to women by prescription. Plaintiffs want an injunction prohibiting this practice and reimbursement of expenses incurred by class members in buying contraceptives that should have been covered by the company. The two suits are docketed as Glaubach v. Regence Blue Shield, No. C01- 1221L and ACLU v. Regence Blue Shield, No. C01-1222L. TAK TAI: Palm Juice Products Sold in B.C., Alberta Being Recalled ----------------------------------------------------------------- The Canadian Food Inspection Agency and Tak Tai Trading Co. Ltd. are warning consumers with allergies to sulphites not to consume The Sun And 9 Coconut Palms Brand Palms Juice. This product may contain sulphites that are not declared on the label. Tak Tai is voluntarily recalling the affected product from the marketplace. The product has been distributed in British Columbia and Alberta. The Sun And 9 Coconut Palms Brand Palms Juice is sold in 355g bottles with UPC 7 61934 04001 1. The affected product has a main label stating 9 Coconut Palms Brand, and with a cap and a neck label stating The Sun And 9 Coconut Palms Brand. The Sun And 9 Coconut Palms Brand Palms Juice is packed for Tak Tai Trading Co Ltd. and exported by Thai Lee International, Bangkok, Thailand. Consumption of this product may cause a serious or life-threatening reaction in persons with allergies to sulphites. There have been no reported illnesses associated with the consumption of this product. For more information, contact Garfield Balsom (English) of the Canadian Food Inspection Agency, Office of Food Safety and Recall by Phone: 613- 760-4232 or Brian Radey (French) by Phone: 613-755-3324 TEXAS: Supreme Court Allows Environmental Suit Discovery To Proceed ------------------------------------------------------------------- The Texas Supreme Court is allowing discovery to continue in the class action brought against fifteen corporations by 448 former employees of the Parker Hannifin Corporation's O-ring seal manufacturing facility in McAllen, Texas. The case will proceed in Texas Trial Court. The suit includes as defendants, chemical giants Union Carbide Chemicals, Shell Oil and Copolyer Rubber & Chemical. The suit alleges the class members suffered personal injuries from a combination of chemicals made by or supplied to the plant by the corporations. The employees allege that these injuries resulted from exposure to a "toxic soup" of chemicals in the plant's environment. THIMEROSAL LITIGATION: Federal Court Remands Suit To Oregon State Court ----------------------------------------------------------------------- Parents who are suing 10 pharmaceutical companies for allegedly causing autism in their children scored a modest victory when a federal court ruled recently that the suit can be tried in a state court. According to a report by Northwest NewsChannel 8, US Magistrate Donald Ashmanskas remanded the case two weeks ago to the Multnomah County Circuit Court in Oregon. The defendants had until yesterday to challenge the judge's order. Lawyer Kathleeen Daily, who represents the plaintiffs, says the ruling is favorable to her clients, as it effectively "levels the playing field" with the high-profile defendants. The defendants in the lawsuits are: (1) Aventis Pasteur Inc., (2) Pfizer Inc., a subsidiary of Warner-Lambert, (3) GlaxoSmithKline, (4) Merck & Co., (5) Abbott Laboratories, (6) American Home Products, (7) Baxter International Inc., (8) Eli Lilly & Co., (9) Sigma Chemical Co., and (10) Aldrich Chemical Co. "It levels the playing field because it is more affordable to wage this battle against these mega-corporations in state court rather than federal court," Ms. Daily says of the ruling. The case was originally filed by George and Tory Mead, a Portland couple whose 3-year-old son, William, developed autism after receiving vaccines containing the preservative thimerosal, a form of mercury. These vaccines have been routinely administered to U.S. children since the early 1990s. In 1999, however, the American Academy of Pediatrics and the U.S. Public Health Service recommended thimerosal use stop. Mr. Mead claims a number of research studies point to an increasing case of autism and associated neurological disorders among children since the government began using these vaccines. Although the National Academy of Sciences, in a report last October, admitted that a link between thimerosal and disorders in children has yet to be proven, it nevertheless backs a 1999 recommendation to remove vaccines with thimerosal from the country's medical stockpile. Three doctors, including one who treated Mr. Mead's son, are also named as defendants, the report says. Securities Fraud ARTHUR ANDERSEN: Petroleum Firm Sues For Involvement in Enron Collapse ---------------------------------------------------------------------- The Tulsa-based petroleum producer Samson Investment filed a civil lawsuit in Tulsa County District Court against the accounting firm of Chicago-based Arthur Andersen, charging the firm with fraud and negligence, the Associated Press recently reported. The suit alleges that the Company "recklessly disregarded evidence of questionable financial transactions between Enron and its insiders, and otherwise failed to exercise the degree of care, skill and competence that should be exercised by competent members of the accounting profession when confronted with highly questionable insider transactions." According to the filing, Samson and other "similarly situated entities justifiably relied on the financial audits of Enron" in "entering into contracts with Enron relating to the purchase and sale of hydrocarbons, such as natural gas." The suit, which was filed on behalf of those entities that were detrimentally affected by the Company in connection with auditing services provided to Enron, further alleges that the audits and financial materials prepared by the Company and distributed for public dissemination by Enron in various Securities and Exchange Commission filings were "grossly misleading." Additionally, the Company allegedly did not exercise reasonable care or competence in obtaining and/or communicating the financial data. The suit states, if the Company properly performed its duties, "Samson and class members would not have entered into contracts with Enron." CROSSWORLDS SOFTWARE: Shareholders Sue To Block IBM Corportion Merger --------------------------------------------------------------------- Shareholders of CrossWorlds Software have filed a class action in San Mateo Superior Court, seeking to block the merger of the Company with IBM Corporation. The suit claims that the Company's directors sold the Company at an "unfairly low price" to make the deal attractive to IBM. The suit additionally claims that Company executives breached their fiduciary duties to shareholdings, by releasing the firm's record third quarter financial results hours after the IBM announcement of its purchase of the Company. According to an iWon report, after the financial markets had closed in October 30, the Company reported a pro forma profit of $900,000 (3 cents per share). Including restructuring charges and other items, the company reported a loss of $1.5 million (6 cents). IBM has announced that it had completed the purchase of the Company, for $129 million, or $4.65 per share, the company's closing price on January 11. The suit says the IBM announcement came at just after 8 am, which it called "a surprise to CrossWorlds' shareholders." CrossWorlds representatives referred questions to IBM. IBM officials declined to comment on the matter, though a spokesman called such complaints common in acquisitions, according to the San Francisco Chronicle. Lawyers for the plaintiffs disagreed. "We would not have proceeded in filing this case if we didn't have strong reason to believe the terms on which this transaction is taking place were highly unfair to the minority shareholders of CrossWorlds," said Corey Holzer, of Holzer & Holzer in Atlanta. CUMULUS MEDIA: April Securities Suit Settlement Hearing Scheduled ----------------------------------------------------------------- The United States District Court for the Eastern District of Wisconsin set for April 5, 2002 the fairness hearing for the $13 million package proposed by Cumulus Media, Inc. to settle a securities class action filed on behalf of purchasers of the Company's stock from October 26,1998 to March 16,2000 inclusive, including purchasers of the Company's stock issued in secondary offerings on July 22,1999 or November 18,1999. The suit alleges, among other things, violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and Sections 11 and 12(a) of the Securities Act of 1933. Under the settlement, the Company will also provide 240,000 shares of freely tradable common stock. The hearing will determine whether: (1) the proposed settlement and plan of allocation should be approved by the court as fair, reasonable and adequate; (2) shares to be distributed to class members and plaintiffs counsel should be exempt from registration under Section 3(a)(10) of the Securities Ace of 1953 and (3) the application of plaintiff's counsel for attorneys' fees and reimbursement of expenses shall be considered. For more information, contact David Kessler of Schiffrin and Barroway LLP by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 or by Phone: 610-667-7706. ENRON CORPORATION: Lawyers Allege Destruction of Vital Documents ---------------------------------------------------------------- Lawyers pursuing several class action suits against fallen energy giant Enron Corporation accused the Company of shredding loads of documents after being informed by the Securities and Exchange Commission of its investigation into the Company's accounting practices and financial disclosures. William Lerach, from the law firm of Milberg Weiss, informed Associated Press, that destruction of evidence at the Company was "open and notorious and widespread.They even shredded on Christmas Day." Another lawyer, G. Paul Howes, mentioned the testimony of a former Enron executive, Maureen Castaneda, that said the Company began shredding documents after Thanksgiving in an accounting office and continued through at least mid-January. According to an Associated Press report, Ms. Casta�eda displayed one box of the shredded material during an ABC news interview, which she said, "I got.when I was leaving work to basically use.for packing material." She added, "There were.a lot more than this." Mr. Howes further said some of the shredded Enron papers "included those clearly marked Jedi II and Chewco", a reference to partnerships through which the Company disguised debt because they were not formally included in its balance sheet. The partnerships were a major factor in sending the Company into bankruptcy. Company lawyer Robert Bennett said the Company was investigating the destruction of documents at their headquarters. Earlier, the Company sad they had instructed their employees to avoid destroying the documents and that they would deal with anyone who disobeyed the directive. EXFO ELECTRO: Disputes Investors Claims in Securities Suit in NY ----------------------------------------------------------------- Exfo Electro Optical Engineering, Inc. faces a securities class action pending in the United States District Court for the Southern District of New York on behalf of purchasers of the Company's securities between June 29, 2000 and December 6, 2000, inclusive. The suit names as defendants the Company and: (1) Merrill Lynch, Pierce, Fenner & Smith, Inc., (2) RBC Dominion Securities Inc., (3) Wit Soundview Corporation, (4) CIBC World Markets Inc., (5) Germain Lamonde and (6) Pierre Plamondon The suit alleges violations of the Securities Exchange Act of 1934 and and Rule 106-5 promulgated thereunder and sections 11, 12 and 16 of the Securities Act of 1933. The suit alleges that the Company's registration statement and prospectus filed with the Securities and Exchange Commission on June 29, 2000 contained material misrepresentations and/or omissions resulting from: (i) the underwriters allegedly soliciting and receiving additional, excessive and undisclosed commissions from certain investors in exchange for which they allocated material portions of our shares issued in connection with our initial public offering; and (ii) the underwriters allegedly entering into agreements with customers whereby our shares issued in connection with our initial public offering would be allocated to those customers in exchange for which such customers agreed to purchase additional amounts of our shares in the aftermarket at pre- determined prices. The Company believes that its executive officers have fully complied with all applicable securities laws and that the allegations in the suit are without merit. The Company says that it will vigorously defend its position in this litigation. FINISAR CORPORATION: Sued For Securities Act Violations in S.D. NY ------------------------------------------------------------------ Finisar Corporation labeled "without merit" the securities class action pending in the United States District Court for the Southern District of New York on behalf of purchasers of its common stock from November 17, 1999 through December 6, 2000, against the Company and: (1) Jerry S. Rawls, President and Chief Executive Officer, (2) Frank H. Levinson, Chairman of the Board and Chief Technical Officer, (3) Stephen K. Workman, Vice President, Finance and Chief Financial Officer, and (4) an investment banking firm that served as an underwriter for an initial public offering in November 1999 and a secondary offering in April 2000. The suit alleges violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and, as to the underwriter only, Section 10(b) of the Securities Exchange Act of 1934, on the grounds that the prospectuses incorporated in the registration statements for the offerings failed to disclose, among other things, that (i) the underwriter had solicited and received excessive and undisclosed commissions from certain investors in exchange for which the underwriter allocated to those investors material portions of the shares of our stock sold in the initial public offering, and (ii) the underwriter had entered into agreements with customers whereby the underwriter agreed to allocate shares of our stock sold in the initial public offering to those customers in exchange for which the customers agreed to purchase additional shares of our stock in the aftermarket at pre-determined prices. The Company claims the suit is part of the trend of lawsuits filed relating to more than 300 other initial public offerings conducted in 1999 and 2000. Those cases have been consolidated for pretrial purposes before the Honorable Judge Shira A. Scheindlin and the defendants' time to respond to the complaints has been stayed pending a plan for further coordination. The Company vows to oppose the litigation vigorously, but cannot give any assurance as to its outcome. The Company says that an adverse development in the suit could materially affect their business operations. IMCLONE SYSTEMS: House Panel Commences Inquiry Into Erbitux Disclosures ----------------------------------------------------------------------- Imclone Systems faces a House Energy and Commerce Committee inquiry into its dealings with the US Food and Drug Administration (FDA) regarding its cancer drug Erbitux. The Committee is the same congressional committee investigating fallen Enron Corporation's collapse. The Company came under fire earlier this month, after the FDA rejected the application for Erbitux. The FDA said the Company filed a materially deficient application. In response to the FDA's rejection of the application, the Company misleadingly downplayed the severity of the problem by issuing additional false and misleading statements. On January 4, 2002, a publication known as The Cancer Letter reported that the FDA repeatedly informed the Company about the problems with the clinical trials, but the Company took no heed. In response to these developments, the Company's share price plummeted from a high of $75 to a low of $34.96 by January 7,2002. This spurred multiple class actions from investors who experienced a huge financial loss due to the debacle. Committee heads Rep. Billy Tauzin (R-La.) and Rep. James Greenwood (R- Pa.) will lead the inquiry, in hopes to determine whether the Company misled the public and its investors by saying all was well with Erbitux. Last week, formal letters of inquiry were sent to ImClone, to its partner Bristol Myers-Squibb and the FDA. According to the letters, the committee wants to know whether the Company's CEO Sam Waksal and his brother and COO Harlan Waksal knew about the FDA concerns with Erbitux all along, but failed to disclose the information to investors or to Bristol-Myers, according to a TheStreet.com report. At the same time the trials for Erbitux were being conducted, the Company was negotiating with Bristol-Myers to buy their stocks for millions of dollars. The congressmen are concerned, according to TheStreet.com, that Mr. Waksals was offered sweetheart loans from ImClone last summer to purchase low-priced shares of the Company's stock. Allegedly, the Company also didn't disclose the information about the FDA's rejection of the Erbitux application until last week, when Sam Waksal made a statement at a health care conference. The panel wants to see all records relating to the Erbitux application, as well as correspondence and records of meetings between the FDA and the Company. The letters also state the panel wants to know "whether the FDA has had contact with the SEC on the ImClone/Erbitux matter, and, if there was contact, appropriate details about the nature of the contact." Because of his role in the fiasco, COO Harlan Waksal might resign from the Company. He has been criticized for his role in the application, and has come under fire for selling $50 million of his Company stock just three weeks before the FDA rejection. Investors have alleged that Mr. Waksal benefited from insider information, despite explanations from the Company that he needed to sell the stock to pay taxes. News of the Congressional inquiry caused shares to fall even lower last week to $19.28. The Company, Bristol-Myers and the FDA have until the end of January to comply with the requests. In a statement ImClone said it will cooperate with the investigation. LIBERTY MEDIA: Shareholders Sue To Block Merger With Liberty Digital -------------------------------------------------------------------- Liberty Media Group faces a class action suit pending in Denver County District Court, in the State of Colorado, challenging the proposed merger of the Company with Liberty Digital, Inc., on behalf of all public shareholders of Liberty Digital. The suit names both Companies, CEO John C. Malone and the directors of Liberty Digital as defendants and alleges that the proposed transaction is in breach of various fiduciary duties of the defendants to the public shareholders of Liberty Digital. The suit alleges that the value of the consideration offered by Liberty Media for the public shares of Liberty Digital is too low. Discovery has not yet begun in this case. The parties have agreed that following the filing of the registration statement of which this notice/prospectus forms a part, the plaintiffs will determine whether to proceed with their current complaint or to amend the complaint, and whether to seek a preliminary injunction. The Company denied all of the plaintiffs' claims and intends to defend the litigation vigorously regardless of the course of action pursued by the plaintiffs. LITTLE SWITZERLAND: Delaware Court Approves $1.5M Settlement ------------------------------------------------------------ The US District Court for the District of Delaware gave final approval to the settlement of a securities class action filed against Little Switzerland, Inc. and certain of its former officers and directors for violations of federal securities laws. The court also entered an order of final judgment and dismissal of the suit. The original suit, which also names Destination Retail Holdings Corporation (DRHC) and Stephen G.E. Crane, alleges that the defendants violated federal securities laws by failing to disclose that DRHC's financing commitment to purchase the Company's shares expired on April 30, 1998, before the Company's stockholders were scheduled to vote to approve the proposed merger between the Company and DRHC at the May 8, 1998 special meeting of stockholders. In connection with the settlement, the Company agreed to deposit $1,050,000 into an escrow account. As previously reported, this settlement amount was paid from the proceeds of the Company's existing insurance coverage. The Court also confirmed that the settlement of the suit is not to be construed as an admission of any liability or wrongdoing whatsoever by the Company and the other defendants in the class action. Little Switzerland, Inc. is a specialty retailer of luxury items operating 18 distinctively designed retail stores on five Caribbean islands and in Alaska. WESTERN SAVINGS: Settling Securities Suits in Arizona Federal Court ------------------------------------------------------------------- Western Savings and Loan Association agreed to settle two securities class actions pending in the United States District Court for the District of Arizona against the Company and its officers and directors on behalf of purchasers of its common stock between February 21,1986 to June 14,1989. The Company will settle two suits: the first filed by Streich Lang, PA and Deloitte & Touche USA LLP; the second by lead plaintiff Gary H. Driggs which was preliminarily approved by the Court in July 1995. The settlement hearings will be held in the Arizona federal court on March 18, 2002 to determine: (1) whether the proposed settlement is in good faith; and (2) whether the proposed plan of allocation for the two settlement funds, should include attorney's fees and the reimbursement of costs and expenses incurred in connection with the suits. ********* 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 2002. 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. 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