/raid1/www/Hosts/bankrupt/CAR_Public/021114.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, November 14, 2002, Vol. 4, No. 226
Headlines
APARTHEID REPARATIONS: Firms Accused Of Apartheid Support To Be Named
ASK JEEVES: Court Dismisses With Prejudice Shareholder Derivative Suit
AXEDA SYSTEMS: Asks NY Court To Dismiss Suit For Securities Violations
AXEDA SYSTEMS: Parties Await Hearing on Dismissal of Securities Suit
CAREMARK RX: Asks CA Court To Transfer ERISA Suit To AL Federal Court
CATHOLIC CHURCH: Activist Group Posts Accused Priests List on the Net
CITGO PETROLEUM: Billing Results in Electricity Fraud Lawsuit
CITGO PETROLEUM: Agrees To Settle Suits Over May 1997 Texas Plant Fire
CITGO PETROLEUM: Trial in Race Bias Suits Set For December 2003 in LA
CITGO PETROLEUM: Faces Lawsuits For MTBE Contamination in IL, FL, NY
COLORADO: High Court Refuses To Hear Appeal Over Photo-Radar Tickets
DAMO PLUS: Recalls 26,000 School Supply Sets For Laceration Hazard
ENTRUST TECHNOLOGIES: TX Court Dismisses Consolidated Securities Suit
EVEREADY BATTERY: Recalls 24,000 Kidz Club Flashlights For Burn Hazard
H&R BLOCK: Appealing Order Requiring $75M Refund of Bank Fees
PUGET SOUND: Reliant, Duke Energy File Cross-Complaints in CA Suit
RADIO ONE: Court Approves Dismissal of Individual Defendants From Suit
ROADHOUSE GRILL: Faces Lawsuit For Securities Violations in FL Court
SILICON IMAGE: Individual Defendants Dropped From NY Securities Lawsuit
SYNCOR INTERNATIONAL: Shareholders File Lawsuits Over Bribery Payments
UNITED STATES: Vietnam Veterans Sue Over Secret Weapons Testing Program
UNIVERSAL CORPORATION: Trial in Tobacco Antitrust Suit Set April 2004
UNO-VEN COMPANY: WI Court Grants Summary Judgment Motion in Fraud Suit
VERTICALNET INC.: NY Court Dismisses Officers, Directors From Lawsuit
VIRGINIA ELECTRIC: VA Court Refuses To Dismiss NC Homeowners Lawsuit
VODAFONE PLC: Sued For Issuing Alleged False, Misleading Statements
WD 40 CO. INC: Faces FL Suit Over Use of Automatic Toilet Bowl Cleaners
WYOMING: Pro-Inmate Ruling Likely As Dept "Ignored" Assault Reports
New Securities Fraud Cases
ALLEGHENY ENERGY: Donovan Searles Commences Securities Suit in S.D. NY
ALLEGHENY ENERGY: Weinstein Kitchenoff Commences Securities Suit in NY
AMERICAN ELECTRIC: Mark McNair Commences Securities Suit in N.D. Ohio
ASIA GLOBAL: Abraham & Associates Commences Securities Suit in C.D. CA
CREDIT SUISSE: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
CREDIT SUISSE: Pomerantz Haudek Commences Securities Fraud Suit in NY
ENDOCARE INC.: Wechsler Harwood Lodges Securities Fraud Suit in C.D. CA
OM GROUP: Bernstein Liebhard Commences Securities Fraud Suit in N.D. OH
QUADRAMED CORPORATION: Kaplan Fox Commences Securities Suit in N.D. CA
SALOMON SMITH: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
SYNCOR INTERNATIONAL: Charles Piven Launches Securities Suit in C.D. CA
TENET HEALTHCARE: Mark McNair Launches Securities Fraud Suit in C.D. CA
TENET HEALTHCARE: Wolf Popper Launches Securities Fraud Suit in S.D. NY
TENET HEALTHCARE: Scott + Scott Launches Securities Fraud Suit in NY
TXU CORPORATION: Chitwood & Harley Commences Securities Suit in N.D. TX
UNDERWRITERS LITIGATION: Kaplan Fox Launches Securities Suit in S.D. NY
VODAFONE GROUP: Wolf Haldenstein Commences Securities Fraud Suit in NY
*********
APARTHEID REPARATIONS: Firms Accused Of Apartheid Support To Be Named
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A list of international banks and companies that will face legal action
for allegedly supporting South Africa's apartheid regime is to be
disclosed imminently in Johannesberg, amid new concern about the
negative impact of such lawsuits on foreign investment in Africa, the
Financial Times reports.
The class action is being brought on behalf of 85 victims of apartheid
by a team of lawyers headed by Michael Hausfeld, an American, and
Charles Abraham, a South African. The lawsuit targets companies and
banks accused of profiting from the white minority regime.
Mr. Abrahams confirmed yesterday that the Swiss banks Credit Suisse and
UBS were being sued, as well as banks and companies in the United
States, Germany, England, France and the Netherlands. "The firms which
we are suing allowed the main culprit - the apartheid state - to commit
crimes against humanity," Mr. Abrahams said.
The new lawsuit is separate from another multi-billion-dollar case
which had its first hearing in August in New York. The decision to
pursue two parallel lawsuits was taken by South African non-
governmental organizations and human rights groups which felt uneasy
about the tactics employed by Edward Fagan, the US lawyer heading the
team.
Mr. Fagan, who in 1988, forced Swiss banks into a $1.25 billion
settlement for victims of the Nazi Holocaust, has been criticized by
Khulumani, a victims support group; and Jubilee South Africa, which
decided to throw their weight behind Mr. Hausfeld and Mr. Abrahams.
The government has kept its distance from the lawsuits, while privately
officials have expressed dismay at its timing. President Thabo Mbeki
is focused on "selling" the New Partnership for African Development
(Nepad), his much-questioned and ambitious plan to attract foreign
investment and kick-start the continent's recovery.
F.W. de Klerk, the former president who oversaw the transition to
democracy, has warned that the lawsuit would undermine Nepad and hurt
foreign investment in Africa.
ASK JEEVES: Court Dismisses With Prejudice Shareholder Derivative Suit
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The United States District Court in Northern California dismissed with
prejudice the shareholder derivative lawsuit filed against Ask Jeeves,
Inc.'s officers and directors at the time of its initial public
offering and its underwriters Morgan Stanley & Co., Inc. and
FleetBoston Robertson Stephens.
The suit, originally filed in the Superior Court of California, Alameda
County on behalf of the Company, alleged breach of fiduciary duty,
negligence and unjust enrichment of the named officers and directors,
for acquiescing and/or conspiring with the underwriter defendants in
underpricing the IPO.
On October 31, 2002, the court dismissed the lawsuit, with prejudice.
Plaintiff have 30 days from the date of the judgment to file an appeal.
AXEDA SYSTEMS: Asks NY Court To Dismiss Suit For Securities Violations
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Axeda Systems, Inc. asked the United States District Court for the
Southern District of New York to dismiss a consolidated securities
class action pending against it, certain of its officers and directors,
and several investment banks that were underwriters of its initial
public offering.
The suit, filed purportedly on behalf of investors who purchased our
stock between July 15, 1999 and December 6, 2000, alleges violations of
Sections 11, 12(a)(2) and 15 of the Securities Exchange Act of 1933 and
Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder against one or both of the Company and the
individual defendants.
The claims are based on allegations that the underwriter defendants
agreed to allocate stock in the Company's July 15, 1999 initial public
offering to certain investors in exchange for excessive and undisclosed
commissions and agreements by those investors to make additional
purchases in the aftermarket at pre-determined prices.
Plaintiffs allege that the prospectus for the Company's initial public
offering was false and misleading in violation of the securities laws
because it did not disclose these arrangements.
This lawsuit is part of the massive "IPO allocation" litigation
involving the conduct of underwriters in allocating shares of
successful initial public offerings. The Company believes that more
than one hundred and eighty other companies have been named in more
than eight hundred identical lawsuits that have been filed by some of
the same plaintiffs' law firms.
Certain of the Company's employees are members of the putative classes
alleged in these actions and therefore may have interests adverse to
the Company with respect to the alleged claims in these actions.
The Company believes that the lawsuit and claims are without merit and
that it has meritorious defenses to the actions. The court has not
ruled on the dismissal motion.
AXEDA SYSTEMS: Parties Await Hearing on Dismissal of Securities Suit
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Parties in the securities class action filed against Axeda Systems,
Inc. and certain of its officers and directors await a hearing on the
Company's motion to dismiss the suit, which is pending in the United
States District Court for the Eastern District of Pennsylvania.
The suit, filed on behalf of purchasers of the Company's common stock
from July 15, 1999 through April 27, 2000, alleges violations of the
federal securities laws, specifically Sections 11 and 15 of the
Securities Exchange Act of 1933, Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.
The Company later filed a motion to dismiss the consolidated suit. The
motion is presently fully briefed and the parties are awaiting a
hearing date to be set for the motion.
The Company believes that such lawsuits or claims are without merit and
that it has meritorious defenses to the actions. However, failure to
successfully defend these actions could substantially harm the
Company's results of operations, liquidity and financial condition.
CAREMARK RX: Asks CA Court To Transfer ERISA Suit To AL Federal Court
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Caremark RX has asked the United States District Court for the Central
District of California to allow them to transfer a private class
actions to the United States District Court for the Northern District
of Alabama.
The suit, which is similar to pending litigation recently filed against
other pharmacy benefit management companies, allege that the Company
acts as a fiduciary as that term is defined in the Employee Retirement
Income Security Act of 1974, as amended (ERISA), and that it has
breached certain purported fiduciary duties under ERISA.
An earlier and similar lawsuit filed in the same court has already been
transferred to the Northern District of Alabama. The Company believes
that it has meritorious defenses to these lawsuits.
CATHOLIC CHURCH: Activist Group Posts Accused Priests List on the Net
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Activists for alleged victims of sexual abuse by Roman Catholic priests
have compiled an Internet database listing the names of 573 US priests
who have faced public accusations of child sex abuse since 1996, AP
reports. The list, assembled by 10 Boston-area Catholics operating as
a group called Survivors First, is drawn from US newspaper articles
and, in some cases, court documents.
Survivors First consists of abuse victims, parents of victims and lay
activists who have worked on the project for three months. Paul Baier,
founder of Voice of the Faithful, a Boston-based lay group that seeks
church reforms, said his group was "incredibly cautious" about choosing
the priests it named. Survivors First has allegations from victims
against 2,100 clerics in its files, but is still researching many of
the claims, he told AP.
The group decided at the last minute to drop 100 names from its public
list, and instead to provide information about where to find newspaper
articles about 290 other molestation cases. This action was also
spurred because the US Conference of Catholic Bishops has not compiled
a complete count of molestation cases since victims began going public
in 1985.
"I know as a parent I can't trust the bishops," Mr. Baier told AP.
However, he conceded that people often exaggerate the clerical sex
abuse problem.
The total number of accused clerics in the Survivors First database
should be compared with the 90,000 priests of the past generation, not
the 46,000 currently serving, he said. Using the figure of 2,100
priests with claims against them, that means about 2.3 percent of
priests have been accused of abuse, he said. The Web site also has a
listing of false charges made against clergy, the Associated Press
reports.
For accused priests, the list provides information on each cleric's
city and diocese, and the status or outcome of any criminal or civil
cases, Mr. Baier said. There are five categories:
(1) priests convicted of crimes,
(2) civil settlements in which criminal guilt was not admitted,
(3) pending criminal cases,
(4) pending civil cases and
(5) other situations
"We are trying to put the right data out there - facts, not emotions,"
Mr. Baier told AP. He added that his group would be happy to provide
information to the National Review Board, the church-appointed watchdog
group examining the bishops' handling of the crisis. "We'd love to
work with the church on this database. They have the records," he said.
Tracking the abuse crisis just this year, The Associated Press has
found at least 325 priests have been removed or resigned from their
posts because of abuse allegations.
CITGO PETROLEUM: Billing Results in Electricity Fraud Lawsuit
--------------------------------------------------------------
CITGO Petroleum Corporation faces a class action pending in Illinois
State Court, claiming damages as a result of PDV Midwest Refining,
LLC's (PDVMR) invoicing a partnership in which it is a partner. An
affiliate of the other partner alleges excessive charges for
electricity utilized by these entities' facilities located adjacent to
the Lemont, Illinois refinery. The suit also names PDVMR as a
defendant.
The Company believes it will be able to resolve these claims for a non-
material amount. The electricity supplier to the refinery is seeking
recovery from the Company of alleged underpayments for electricity.
The Company has denied all allegations and is pursuing its defenses.
CITGO PETROLEUM: Agrees To Settle Suits Over May 1997 Texas Plant Fire
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CITGO Petroleum Corporation agreed to settle for an undisclosed amount
approximately seventeen related lawsuits filed in Corpus Christi, Texas
federal and state courts.
The suits relate to a May 1997 fire that occurred at the Company's
Corpus Christi refinery. The suits were filed on behalf of
approximately 9,000 individuals alleging property damages, personal
injury and punitive damages.
In September 2002, the Company reached an agreement to settle
substantially all of the claims related to this incident for an amount
that will not have a material financial impact on the Company, it
asserted in a disclosure to the Securities and Exchange Commission
(SEC).
CITGO PETROLEUM: Trial in Race Bias Suits Set For December 2003 in LA
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Trial in the remaining race discrimination cases against CITGO
Petroleum Corporation is set for December 2003 in Lake Charles,
Louisiana federal court.
The suit was filed by a number of current and former refinery employees
and applicants asserting claims of racial discrimination in connection
with the Company's employment practices. A trial involving two
plaintiffs resulted in verdicts for the Company.
The court granted the Company summary judgment with respect to another
group of claims. These rulings have been affirmed by the Fifth Circuit
Court of Appeals. Trials regarding the remaining cases are set to
begin in December 2003.
The Company does not expect that the ultimate resolution of these cases
will have an adverse material effect on its financial condition or
results of operations.
CITGO PETROLEUM: Faces Lawsuits For MTBE Contamination in IL, FL, NY
--------------------------------------------------------------------
CITGO Petroleum Corporation is among refinery defendants to state and
federal lawsuits in New York and a state action in Illinois alleging
contamination of water supplies by methyl tertiary butyl ether (MTBE),
a component of gasoline.
Plaintiffs claim that MTBE is a defective product and that refiners
failed to adequately warn customers and the public about risks
associated with the use of MTBE in gasoline. These actions allege that
MTBE poses public health risks and seek testing, damages and
remediation of the alleged contamination.
Plaintiffs filed putative class action lawsuits in federal courts in
Illinois, California, Florida and New York. CITGO was named as a
defendant in all but the California case. The federal cases were all
consolidated in a Multidistrict Litigation case in the United States
District Court for the Southern District of New York.
In July 2002, the court in the MDL case denied plaintiffs' motion for
class certification. In August 2002, a New York state court judge
handling two separate but related individual MTBE lawsuits dismissed
plaintiffs' product liability claims, leaving only traditional nuisance
and trespass claims for leakage from underground storage tanks at
gasoline stations near plaintiffs' water wells. The judge in the
Illinois state court action is expected to hear plaintiffs' motion for
class certification in that case sometime within the next year.
COLORADO: High Court Refuses To Hear Appeal Over Photo-Radar Tickets
--------------------------------------------------------------------
The Colorado Supreme Court recently refused to hear the city of
Denver's appeal of a lower court ruling dismissing four photo-radar
tickets, the Rocky Mountain News reports. Last January, Denver County
Judge Mary Celeste dismissed the $40 tickets because they were not
issued by police officers, as required by current law.
In May, a district court judge dismissed the city's appeal of Judge
Celeste's ruling. Denver District Judge Joseph Meyer said the city can
appeal county court rulings dismissing traffic tickets only when a
statute is declared unconstitutional or unenforceable. The city then
appealed to the Supreme Court, which has refused to hear the case.
The ruling pertains only to the four tickets challenged by Denver
lawyers Gary Pirosko, Stuart Barr and one of their clients, Adell
Shaflee, but the case already has had a broad impact on Denver's
program. The city dropped 446 pending photo-radar cases, each
potentially worth at least $40 to the city, in response to Judge
Celeste's ruling.
The city also temporarily suspended photo radar to address the
challenges raised in the case. Photo-radar vans were put back on the
street in June under a newly enacted state law confining them to
residential neighborhoods, school zones and parks.
A separate class action seeking refunds for people who already had paid
photo-radar tickets was dismissed by another Denver district court
judge in September.
DAMO PLUS: Recalls 26,000 School Supply Sets For Laceration Hazard
------------------------------------------------------------------
Damo Plus Corporation is cooperating with the US Consumer Product
Safety Commission (CPSC) by voluntarily recalling about 26,000 10-piece
school supply sets. The sets contain razor knives, which pose a
laceration hazard to children.
The Company has not received any reports of injuries from these pencil
sets. This recall is being conducted to prevent the possibility
of injury.
The school supply sets were sold in 8-inch plastic cases. The sets
included the razor knife, pencils, scissors, a ruler, an eraser, a
compass, and a tube of glue. Writing on the plastic cases includes
"LITTLE WHITE," "LITTLE ARTIST," "GOOD FRIENDS," or "ZHONG BAIO REN."
The cases are blue, pink yellow or purple and have pictures of children
or animals. These sets were sold in plastic bags with cardboard
headers marked "10 PCS SET PENCIL CASE & PENCIL HOLDER," and "MADE IN
CHINA."
Discount and dollar stores in California, Texas, Washington, and
Maryland sold the sets between June and October 2002 for about $1.
For more details, contact the Company by Mail: 4535 E. 48th St.,
Vernon, CA 90058 or by Phone: 323-583-8484 between 8 am and
5 pm. PT Monday through Friday.
ENTRUST TECHNOLOGIES: TX Court Dismisses Consolidated Securities Suit
---------------------------------------------------------------------
The United States District Court for the Eastern District of Texas
dismissed the securities class action pending against Entrust, Inc. on
behalf of persons who purchased or otherwise acquired the Company's
common stock during the period from October 19, 1999 through July 3,
2000.
The consolidated complaint alleged that the defendants misrepresented
and failed to disclose certain information about the Company's business
and prospects, as required by the Securities Exchange Act of 1934. It
did not specify the amount of damages sought.
On September 21, 2001, the Company moved to dismiss the suit. On
September 30, 2002, the court found that the Private Securities
Litigation Reform Act required dismissal of the case because of the
lack of specificity with which the amended complaint was pleaded. The
case was dismissed with prejudice, however, the order is subject to the
possibility of an appeal.
As of the date of this filing, the Company has not learned of any
appeal being filed. If an appeal is granted, an adverse judgment or
settlement in this lawsuit could have a significant adverse impact on
the Company's future financial condition or results of operations.
EVEREADY BATTERY: Recalls 24,000 Kidz Club Flashlights For Burn Hazard
----------------------------------------------------------------------
Eveready Battery Co., Inc. is cooperating with the United States
Consumer Product Safety Commission by voluntarily recalling about
24,000 Kidz Club flashlights, sold under its Energizer brand. The
flashlights can overheat and cause the batteries to leak, posing a risk
of burns to children. The Company has received three reports of the
flashlights overheating, including one report of a 4-year-old boy
receiving a minor burn to his hand.
The multicolored flashlights measure about 5.75 inches in length,
and are made with a metal barrel and a plastic head. They take "C"
batteries and have a rotating focusing head. The model number FC230KBP
appears only on the reverse side of the package. The words Energizer
Kidz Club appear on the head of the flashlight. "Made in China" is
written on the base.
Discount department and toy stores sold these flashlights nationwide
from April 2002 through October 2002 for about $6.
For more details, contact the Company by Phone: (800) 669-6394 between
7 am and 7 pm CT, Monday through Friday, for instructions on returning
the flashlights and receiving a $12 refund, or visit the firm's
Website: http://www.energizerflashlights.com
H&R BLOCK: Appealing Order Requiring $75M Refund of Bank Fees
-------------------------------------------------------------
H&R Block recently announced plans to appeal a Texas judge's planned
order requiring the company to repay $75 million for receiving
undisclosed fees for loans to Texas clients who expected refunds,
Associated Press Newswires reports.
In a letter to attorneys, Judge J. Manuel Banales in Kleberg County,
Texas, announced his plan to order the repayment in the class action.
The lawsuit is one of several the Company faces over "refund
anticipation loans." The judge, in the letter, wrote that the Company
should have disclosed the fees it received from the lender bank,
because the Company was supposed to look out for their clients'
financial interests.
The Company, however, the largest tax preparer in the country, denied
it owes a fiduciary duty to tax customers, saying in a release, that
when Judge Banales formally issues his order, it will "seek appellate
review." The Company's chairman and chief executive officer Mark A.
Ernst told investors the company was "shocked and outraged" at the
ruling.
The loans are made, for a steep fee, to taxpayers who expect a refund.
The Texas lawsuit, like several others around the country, claims the
Company failed to disclose a "license fee" paid to it by the
lending bank. Plaintiffs have characterized the fee as a kickback to
the Company. The Texas lawsuit covers customers who got the loans from
1992 to 1996, the Company began to disclose the fees after 1996.
Plaintiffs would have to prove malice or fraud to win punitive damages
in Texas. A trial for the punitive damages portion of the case is
scheduled for December 2.
PUGET SOUND: Reliant, Duke Energy File Cross-Complaints in CA Suit
------------------------------------------------------------------
Puget Sound Energy, Inc. was served with two cross-complaints, by
Reliant Energy Services and Duke Energy Trading & Marketing,
respectively, in six consolidated class actions pending in Superior
Court in San Diego, California.
The original complaints in the action, which were brought by or on
behalf of electricity purchasers in California, allege that the
original (approximately 40) defendants manipulated the wholesale
electricity markets in violation of various California Business
Practices Act or Cartwright Act (antitrust) provisions.
The plaintiffs in the lawsuits seek, among other things, restitution of
all funds acquired by means that violate the law and payment of treble
damages, interest and penalties. The cross-complaints assert
essentially that the cross-defendants, including PSE, were also
participants in the energy market in California at the relevant times,
and that any remedies ordered against some market participants should
be ordered against all.
Reliant Energy Services and Duke Energy Trading also seek indemnity and
conditional relief as a buyer in transactions involving cross-
defendants should the plaintiffs prevail. Those cross-complaints added
over 30 new defendants, including the Company, to litigation that had
been pending since 2000 and had been set for trial in state court.
Some of the newly added defendants removed the litigation to federal
court. The Company and numerous other defendants added by the cross-
complaints have moved to dismiss these claims. Those motions were
argued on September 19, 2002, and a ruling is not expected until later
this year, when a decision on the plaintiffs' motions to remand the
case back to state court is also expected. As a result of the various
motions, no trial date is set at this time.
RADIO ONE: Court Approves Dismissal of Individual Defendants From Suit
----------------------------------------------------------------------
The United States District Court for the Southern District of New York
approved a stipulation of the parties in the securities class action
pending against Radio One, Inc. and certain of its officers and
directors to dismiss the individual defendants from the suit, without
prejudice.
The suit was commenced in November 2001, alleging that the Company's
offering documents filed with the SEC in May 1999 and November 1999
contained untrue statements of material fact or omissions of material
fact related to the conduct of the underwriters conducting the
offerings. The plaintiffs claim that the Company violated Sections 11
and 12 of the Securities Act of 1933.
Similar complaints were filed in the same court against hundreds of
other public companies that conducted initial public offerings of their
common stock in the late 1990s.
The Company believes that these claims are without merit and intends to
vigorously defend itself. The Company also maintains directors and
officers liability insurance that it believes will be applicable to
this litigation, and the Company may be entitled to indemnification by
the underwriters in the event of an adverse result.
ROADHOUSE GRILL: Faces Lawsuit For Securities Violations in FL Court
--------------------------------------------------------------------
Roadhouse Grill, Inc. faces a class action filed in the United States
District Court for the Southern District of Florida against it, the
chairman of the Company's board of directors, and the Company's
president and chief executive officer.
The suit, filed brought on behalf of all purchasers of the Company's
stock between August 31, 1998, and August 1, 2001, alleges federal
securities violations based principally, if not solely, on the fact
that certain financial statements have been restated.
The Company believes there is no merit to the action. The Company has
filed for relief under Chapter 11 of the United States Bankruptcy Code,
and thus believes that, under section 510(b) of the Bankruptcy Code,
even if claims of the type asserted in the Action are allowed, they
will be subordinated, in the Chapter 11 Case, to the claims of all
creditors of the Company. Accordingly, such claims are treated under
the Confirmed Plan as subordinate to the claims of all creditors.
Based on discussions with counsel, it is the Company's expectation that
the case against the Company will be dismissed. Should the suit
brought by the plaintiffs not be dismissed, the plaintiffs will share
in the distribution of stock in the reorganized company with the
holders of the existing common stock, and will not dilute the
recoveries of the Company's creditors.
SILICON IMAGE: Individual Defendants Dropped From NY Securities Lawsuit
-----------------------------------------------------------------------
Individual defendants in the securities class action filed against
Silicon Image, Inc. have been dismissed from the suit, pending in the
United States District Court for the Southern District of New York,
pursuant to a tolling agreement.
The suit initially named as defendants the Company, certain of its
officers and directors, and the Company's underwriters. The lawsuit
alleges that all defendants were part of a scheme to manipulate the
price of the Company's stock in the aftermarket following the Company's
initial public offering.
According to an earlier Class Action Reporter story, the suit 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.
Response to the complaint and discovery in this action on behalf of the
Company and individual defendants has been stayed by order of the
court. The lawsuit is proceeding as part of a coordinated action of
over 300 such cases brought by plaintiffs in the Southern District of
New York.
At this time, the Company cannot predict the outcome of this lawsuit;
however, the Company intends to defend itself vigorously.
SYNCOR INTERNATIONAL: Shareholders File Lawsuits Over Bribery Payments
----------------------------------------------------------------------
The stock of nuclear-medicine provider Syncor International Corp.
melted down for a third day recently, as lawsuits seeking class action
status accused the Company of misleading shareholders by concealing the
payment of bribes overseas, the Los Angeles Times reports.
The law firms Levy & Levy in Stamford, Connecticut, Abbey Gardy in New
York and Brian M. Felgoise in Philadelphia, said that they had filed
claims in US District Court in Los Angeles, seeking damages on behalf
of shareholders. In a statement, the Levy firm said the Company's news
release and financial filings were materially misleading because they
failed to disclose that Monty and Moses Fu "were making illegal
payments to the Company's overseas customers."
Woodland Hills-based Syncor said recently that its founder, Monty Fu,
and his brother Moses Fu, who ran the company's foreign operations,
have been put on leave while a board committee investigates payments to
customers in China, Taiwan and other countries. It said the payments
may have violated US and foreign laws, including the Foreign Corrupt
Practices Act, which bans bribes.
In June, the Company agreed to a takeover by drug wholesaler Cardinal
Health Inc., in a deal valued at $1.1billion. The deal is on hold
while both firms investigate its business practices. Cardinal Chief
Executive Robert Walker said recently that the Company's pharmacies,
which dispense radioactive drugs that help doctors treat illnesses, are
a good fit for Cardinal, but he said top priority was to protect its
reputation.
Company spokesman Allen Mayer declined comment on the stock price and
lawsuits. He said Syncor is sharing details of its internal
investigation with the Justice Department and the Security and Exchange
Commission. The Company hopes to complete its investigation by
December 6, when its shareholders are to vote on the Cardinal buyout.
UNITED STATES: Vietnam Veterans Sue Over Secret Weapons Testing Program
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Vietnam Veterans of America, charging that potentially thousands of
unknowing military veterans from the 1960s were exposed to a US secret
weapons testing program, is suing former Defense Secretary Robert S.
McNamara and former employees of the departments of Defense and
Veterans Affairs, according to a report by The Hartford Courant.
The class action on behalf of the veterans alleges that military and
federal health officials attempted for decades to conceal and ignore
veterans' health records. These records show that the veterans'
serious illnesses were likely caused by their exposures to chemical,
biological, possibly radioactive and other hazardous agents, the
lawsuit says. Pentagon and VA officials have said repeatedly that they
have done everything they could to help the veterans.
"The Department of Defense is committed to providing the information
needed by the Department of Veterans Affairs to offer the appropriate
benefits and care to veterans," said James Turner a Defense Department
spokesman. "The tests were operational in nature, and some of the
information remains operationally classified. We have reviewed the
records to identify medically relevant information and have
declassified this information and have provided it to the VA."
The Defense Department is continuing to look for information in its
files and its spokesmen have said many of the files were classified and
could not be released, but officials are making every attempt to get
veterans all the information they need. VA officials say they are
working with the Pentagon to notify all potentially exposed veterans so
they can make any necessary health claims.
Had veterans known about the hazardous exposures, the lawsuit says,
they would have been able to obtain immediate federal health care and
disability payments. This would have permitted veterans to pay their
heavy expenses after they became sick from cancer, neurological, heart
and other problems, say veterans' advocates bringing the court action.
Veterans and their advocates have been complaining to the Defense
Department and the US Department of Veterans Affairs for seven years
about a dearth of data that could help them determine how they got sick
and whether some of them might have died prematurely from the
exposures.
The ocean-going tests, known as Project Shipboard Hazard and Defense,
were "to identify US warships' vulnerabilities to attacks with chemical
or biological warfare agents," said Pentagon officials.
There were at least 109 tests on land and various locations including
the Pacific and Atlantic oceans, from 1962 to 1973, conducted by the
Deseret Test Center, headquartered at Fort Douglas, Utah. The court
complaint by 21 of the veterans calls for monetary damages to veterans
for the violation of their constitutional rights and court-ordered
disclosure of information that will assist the veterans in obtaining VA
health care and benefits for the consequences of exposure to hazardous
agents. The complaint is not designed to seek individual VA
compensation benefits.
"America's veterans deserve proper health care for illnesses that may
be due to exposure to harmful agents as a result of their military
service," said VVA National President Thomas Corey. "Veterans deserve
to be told the truth about their military service, (and they deserve)
accountability from senior bureaucrats and other government officials."
UNIVERSAL CORPORATION: Trial in Tobacco Antitrust Suit Set April 2004
---------------------------------------------------------------------
Trial in the tobacco class action filed against Universal Leaf Tobacco
Company, Incorporated in the United States District Court for the
Middle District of North Carolina, Greensboro District is currently
scheduled for April 2004.
The suit was commenced in February 2001 against the Company, other leaf
merchants and subsidiaries of its parent Company Universal Corporation:
(1) J.P. Taylor Company, Incorporated and
(2) Southwestern Tobacco Company, Incorporated.
The suit, also known as the DeLoach Suit, is a class action brought on
behalf of US tobacco growers and quota holders that alleges that
defendants violated antitrust laws by bid-rigging at tobacco auctions
and by conspiring to undermine the tobacco quota and price support
program administered by the federal government.
On April 3, 2002, the court issued an opinion and order certifying the
class. The Company subsidiaries petitioned the US Court of Appeals for
the Fourth Circuit for appeal of the class certification pursuant to
Rule 23(f) of the Federal Rules of Civil Procedure, and the petition
was denied.
The Company intends vigorously defend the suit. The suit is still in
its initial stages, and at this time no estimate of the impact on the
Company that could result from an unfavorable outcome at trial can be
made.
UNO-VEN COMPANY: WI Court Grants Summary Judgment Motion in Fraud Suit
----------------------------------------------------------------------
The United States District Court in Wisconsin granted UNO-VEN Company's
motion for summary judgment in the class action filed by four of the
Company's former marketers alleging improper termination of the UNO-VEN
Marketer Sales Agreement under the Petroleum Marketing Practices Act in
connection with PDV Midwest Refining, LLC's (PDVMR) 1997 acquisition of
Unocal's interest in UNO-VEN.
The plaintiffs are appealing the summary judgment. PDVMR and its
parent, VPHI, jointly and severally, have agreed to indemnify UNO-VEN
and certain other related entities against certain liabilities and
claims, including this matter.
VERTICALNET INC.: NY Court Dismisses Officers, Directors From Lawsuit
---------------------------------------------------------------------
The United States District Court for the Southern District of New York
dismissed, without prejudice, the claims against Verticalnet, Inc.'s
officers and directors in the securities class action pending against
them, the Company and four underwriters involved in the initial public
offering of the Company's common stock in February 1999:
(1) Lehman Brothers Inc.,
(2) Hambrecht & Quist LLC,
(3) Volpe Brown Whelan & Company LLC and
(4) WIT Capital Corporation
The consolidated suit alleges violations of Sections 11 and 15 of the
Securities Act of 1933 and Section 20(a) of the Securities Exchange Act
of 1934 and Rule 10b-5 promulgated thereunder, based on, among other
things, claims that the four underwriters awarded material portions of
the initial shares to certain favored customers in exchange for
excessive commissions.
The suit also asserts that the underwriters engaged in a practice known
as "laddering," whereby the clients or customers agreed that in
exchange for IPO shares they would purchase additional shares at
progressively higher prices after the IPO.
With respect to the Company, the complaint alleges that the company and
its officers and directors failed to disclose in the prospectus and the
registration statement the existence of these purported excessive
commissions and laddering agreements.
The suit also asserts that, in addition to Sections 11 and 15 of the
Securities Act, the Company and its officers and directors also
violated Sections 10(b), 20(a) and Rule 10b-5 of the Exchange Act in
connection with the IPO.
The plaintiffs in this lawsuit and in the hundreds of other similar
suits filed against other companies in connection with IPOs that
occurred in the late 1990s have filed "master allegations" that
primarily focus on the conduct of the underwriters of the IPOs,
including the Company IPO.
On October 9, 2002, the court entered an order dismissing, without
prejudice, the claims against the individual Company officers and
directors who had been named as defendants in the various complaints.
The Company has retained counsel and intends to vigorously defend
itself in connection with the allegations raised in the amended and
consolidated complaint.
VIRGINIA ELECTRIC: VA Court Refuses To Dismiss NC Homeowners Lawsuit
--------------------------------------------------------------------
The United States District Court in Richmond, Virginia refused to
dismiss the class action filed against Virginia Electric and Power
Company and its affiliate Dominion Telecom, Inc. The court also
allowed plaintiffs to amend the suit to add a new plaintiff.
The suit was filed in June 2002 by two North Carolina landowners
alleging that Virginia Power and Dominion Telecom strung fiber optic
cable across their land, along a Virginia Power electric transmission
corridor without paying compensation. The plaintiffs are seeking
damages for trespass and "unjust enrichment" as well as punitive
damages from Virginia Power and Dominion Telecom.
The named plaintiffs purport to "represent a class . consisting of all
owners of land in North Carolina and Virginia, other than public
streets or highways, that underlies (Virginia Power's) electric
transmission lines and on or in which fiber optic cable has been
installed."
In October 2002, the court denied the defendants' motion to dismiss and
granted plaintiffs' motion to amend the complaint to add another
plaintiff. The outcome of the proceeding, including an estimate as to
any potential loss, cannot be predicted at this time.
VODAFONE PLC: Sued For Issuing Alleged False, Misleading Statements
-------------------------------------------------------------------
Wolf Haldenstein Adler Freeman & Herz LLP has said it has filed a class
action against Vodafone Group PLC and some of its officers for
allegedly issuing "false and misleading" statements which "artificially
inflated" the market price of the company's securities, AFX News
reports.
The lawsuit was filed in the US District Court for the Southern
District of New York, on behalf of buyers of the Company's American
Depositary Receipts between March 7, 2001, and May 28, 2002, referred
to in the complaint as the class period. The complaint alleged that
during the class period, the Company failed to disclose certain adverse
facts, which were known by the company.
Specifically, the Company failed to disclose that the migration of
telecommunications users from fixed-wire to wireless services was
having a material adverse effect on the company. The Company, directly
and through its partnerships, had significant investments in fixed-wire
operations, throughout Europe and Japan, which were losing customers to
wireless providers (including the company).
The Company also omitted to disclose, the lawsuit said, that the
Company was improperly postponing the write-down of billions of dollars
of goodwill and impaired assets, thereby artificially raising the
Company's reported financial results. In truth, although the Company
claimed that the company had a "solid balance sheet," when it
ultimately did write off the value of its impaired assets and goodwill,
the Company eliminated all profits for 2001, 2002 and possibly beyond,
the suit added.
The complaint also said the Company had vastly overpaid for the many
acquisitions it made in prior years, many with inflated stock
WD 40 CO. INC: Faces FL Suit Over Use of Automatic Toilet Bowl Cleaners
-----------------------------------------------------------------------
WD 40 Co., Inc. faces a class action filed in Florida State Court, for
damage claims arising out of the use of the automatic toilet bowl
cleaners sold by the Company under the brand names, 2000 Flushes and X-
14.
If class certification is granted, it is reasonably possible that the
outcome of the suit could have a material adverse effect on the
operating results of the Company. There is not sufficient information
to estimate the Company's exposure at this time.
WYOMING: Pro-Inmate Ruling Likely After Dept "Ignores" Assaults
----------------------------------------------------------------
A federal judge indicated he is leaning toward a ruling in favor of
inmates in a lawsuit that claims prison officials failed to investigate
hundreds of assaults at the state penitentiary, Associated Press
Newswires reports.
An attorney for the American Civil Liberties Union recently asked US
District Judge Clarence Brimmer to order the Wyoming Corrections
Department to ensure the safety of all present and future inmates.
Prison officials are violating Eighth Amendment rights, subjecting
inmates to cruel and unusual punishment, by ignoring policy requiring
investigation of inmate-on-inmate assaults, Stephen L. Pevar told Judge
Brimmer during a hearing on Friday.
"We know from the record that the defendants have been doing all the
wrong things and none of the right things for a long time," Mr. Pevar
said. Judge Brimmer did not issue an immediate decision, but said he
may require the state Division of Criminal Investigations to look into
assaults in the prison, adding that investigators should come from
outside the Corrections Department to ensure their objectivity.
Judge Brimmer expressed his concern that Corrections Director Judith
Uphoff, former Warden Scott Abbott did not come to court to defend
themselves. "They are perhaps yawning and hoping this will go away,"
said Judge Brimmer.
Prison officials have declined comment on the litigation. Inmate Brad
Skinner filed the lawsuit earlier this year after he claims he was
seriously hurt when other inmates beat him.
The ACLU claims the Department of Corrections knows of the 100 to 300
attacks over the past six years, one of which left an inmate dead.
Just three of those attacks have been investigated and no disciplinary
action was taken against prison staff members in any case, the group
claims.
New Securities Fraud Cases
ALLEGHENY ENERGY: Donovan Searles Commences Securities Suit in S.D. NY
----------------------------------------------------------------------
Donovan Searles, LLC initiated a securities class action in the United
States District Court for the Southern District of New York on behalf
of all persons who purchased securities of Allegheny Energy Inc.
(NYSE:AYE) between April 23, 2002 and October 8, 2002, inclusive.
The suit alleges that defendants violated Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder, by issuing a series of material misrepresentations to the
market during the class period.
According to the suit's allegations, defendants failed to state that
the Company's revenues (and revenue guidance) materially depended upon
illusory, revenue creating, "wash transactions" with Enron, and other
deceptive energy trading practices.
On September 25, 2002, the Company sued Merrill Lynch for fraud and
breach of contract related to the acquisition of one of its operating
subsidiaries from Merrill Lynch. In that lawsuit, Allegheny Energy
alleged, among other things, that it overpaid for the subsidiary
because the unit's financial reports had been inflated by sham trades
involving Enron.
The Company admitted that the subsidiary engaged in a significant
amount of wash or round trip energy trades with Enron. The Company
further admitted that the effect of those trades was to artificially
inflate revenues, trading volumes and growth rate.
Accordingly, the Company is alleged to have admitted that its
consolidated results were also artificially inflated, thereby
artificially inflating the market price of its securities during the
class period.
On October 1, 2002, Moody's downgraded Allegheny Energy's credit to
junk status. In a press release, the Company reassured investors that
this would not trigger any default or prepayment of the firm's debt. A
week later, however, the Company admitted it was in technical default
under its credit agreements. The Company's stock price then tumbled
from a high of $12.85 on September 25, 2002, to $3.80 on October 8,
2002 -- a drop of $9.05, or 70%.
For more details, contact Michael D. Donovan by Mail: 1845 Walnut
Street, Suite 1100, Philadelphia, PA 19103 by Phone: 215-732-6067 or
800-619-1677 or by E-mail: mdonovan@donovansearles.com.
ALLEGHENY ENERGY: Weinstein Kitchenoff Commences Securities Suit in NY
----------------------------------------------------------------------
Weinstein Kitchenoff Scarlato & Goldman Ltd. initiated a securities
class action on behalf of investors who purchased shares of Allegheny
Energy, Inc. (NYSE: AYE), between April 23, 2001 and October 8, 2002,
in the United States District Court for the Southern District of New
York against the Company and:
(1) Alan J. Noia,
(2) Michael P. Morrell,
(3) Bruce E. Walenczyk and
(4) Daniel L. Gordon
According to the complaint, Allegheny Energy Supply Company, a
subsidiary of Allegheny Energy, acquired Global Energy Markets (G.E.M.)
on March 16, 2001. Before and after the acquisition, G.E.M. engaged in
sham "wash" trades with Enron and like companies that materially
inflated G.E.M.'s reported revenues. After the acquisition, G.E.M.'s
sham trades had the effect of inflating Allegheny Energy's reported
revenue.
The complaint charges that defendants knew or were reckless in not
knowing about the G.E.M. "wash" trades, and as a result, Allegheny
Energy's public statements during the class period, which failed to
disclose that the "wash" trades were responsible for a surge in the
Company's revenue, were false and misleading.
The complaint charges defendants with making other false and misleading
statements as well. Specifically, after Moody's downgraded Allegheny
Energy's credit to junk status on October 1, 2002, the Company issued a
press release stating that the Moody's actions would not trigger a
default on Allegheny's debt arrangements.
Then, just one week later, on October 8, 2002, the Company announced
that it was in technical default on its debt arrangements. The next
day, on October 9, 2002, the Company announced that it intended to cut
the dividend by more than half, whereas on July 30, 2002, Allegheny
Energy reaffirmed its commitment to the dividend as a priority and
reassured investors that the dividend was adequately covered by
earnings.
On October 8, 2002, the Company's stock, which had traded as high as
$45.53 at the beginning of the class period, closed at $3.80, down from
a close of $7.52 the previous day.
For more details, contact Brian Penny or Paul Scarlato by Phone:
888-545-7201 by E-mail: penny@wksg.com or scarlato@wksg.com or visit
the firm's Website: http://www.wksg.com.
AMERICAN ELECTRIC: Mark McNair Commences Securities Suit in N.D. Ohio
---------------------------------------------------------------------
The Law Office of Mark McNair commenced a securities class action
against American Electric Power Co. (NYSE:AEP). The complaint is on
behalf of, and seeks damages for shareholders who purchased the stock
from May 17, 1999 through October 9, 2002, inclusive, in the United
States District Court for the Northern District of Ohio.
The complaint alleges that AEP and certain of its officers, directors
and three underwriters violated the federal securities laws by issuing
materially false and misleading statements throughout the class period
that had the effect of artificially inflating the market price of the
Company's securities.
Among other things, the complaint alleges:
(1) AEP failed to disclose that it was engaging in electricity
trades transactions involving sequential trades with the same
terms and counterparties;
(2) AEP overstated its revenues in SEC filings by including such
revenue; and
(3) AEP lacked sufficient management controls to prevent such
activities by its traders.
AEP first denied that it engaged in activities referred to as "wash" or
"round-trip" trading, but later admitted to engaging in such trades.
On August 30, 2002 AEP revealed that the SEC had initiated an informal
inquiry into its trading practices. On October 9, 2002, AEP disclosed
that it had fired five employees for reporting inaccurate price
information and its stock dropped to a 52-week low of $15.10.
For more details, contact Mark McNair by Mail: 1101 30th Street N.W.,
Suite 500, Washington, D.C, 20007 by Phone: 877-511-4717 or
202-872-4717 by E-mail: mcnair@justice4investors.com or visit the
firm's Website: http://www.justice4investors.com.
ASIA GLOBAL: Abraham & Associates Commences Securities Suit in C.D. CA
----------------------------------------------------------------------
Abraham & Associates initiated a securities class action on behalf of
all persons who purchased shares of Asia Global Crossing Ltd.'s
(OTC:ASGXF) common stock on the Company's initial public offering dated
October 6, 2000 (IPO), pursuant to the Registration Statement and
Prospectus filed with the Securities and Exchange Commission in
connection with the IPO.
The complaint was filed in the United States District Court for the
Central District of California, Western Division, and names as
defendants, in addition to Asia Global, certain of the Company's
officers and/or directors at the time of the IPO, and the two firms
which served as lead underwriters of the IPO, Goldman, Sachs & Co. and
Salomon Smith Barney, Inc.
The complaint alleges that the defendants violated Sections 11 and
12(a)(2) of the Securities Act of 1933 by making materially false and
misleading statements in the Registration Statement and Prospectus
regarding the viability of Asia Global's business, funding it was
supposed to receive from its parent company, and the value of certain
assets.
The complaint further alleges that as a result of these materially
false and misleading statements the price at which the shares of Asia
Global common stock were sold on the IPO was artificially inflated.
For more details, contact Lawrence D. Levit by Mail: One Penn Plaza,
Suite 1910, New York, New York 10119 by Phone: (212) 714-2444 or (800)
938-0015 by Fax: (212) 279-3655 or by E-mail: Larryl@abrahamlaw.com.
CREDIT SUISSE: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
--------------------------------------------------------------------
Kaplan Fox & Kilsheimer LLP initiated a securities class action against
Credit Suisse First Boston Corporation (CSFB), in the United States
District Court for the Southern District of New York on behalf of all
persons or entities who purchased the common stock of Agilent
Technologies (NYSE: A) between December 13, 1999 and September 9, 2002,
inclusive.
The complaint alleges that defendant CSFB violated the federal
securities laws by issuing analyst reports regarding Agilent that
recommended the purchase of Agilent common stock and which set price
targets for Agilent common stock, without any reasonable factual basis.
The complaint further alleges, among other things, that when issuing
its Agilent analyst reports, defendant CSFB failed to disclose
significant, material conflicts of interest which it had concerning the
Agilent reports, because of CSFB's desire to obtain investment banking
business from Agilent.
Throughout the class period, CSFB maintained "BUY" or "HOLD"
recommendation on Agilent in order to obtain and support lucrative
financial deals for CSFB. As a result of CSFB's false and misleading
analyst reports, Agilent common stock traded at artificially inflated
levels during the class period.
For more details, contact Joel B. Strauss or Donald R. Hall by Mail:
805 Third Avenue, 22nd Floor, New York, NY 10022 by Phone:
800-290-1952 or 212-687-1980 by Fax: 212-687-7714 by E-mail:
mail@kaplanfox.com
CREDIT SUISSE: Pomerantz Haudek Commences Securities Fraud Suit in NY
---------------------------------------------------------------------
Pomerantz Haudek Block Grossman & Gross LLP initiated a securities
class action against Credit Suisse First Boston Corporation (CSFB) and
Elliott Rogers (Rogers), a Managing Director and Senior Analyst in the
Global Technology Group of CSFB, on behalf of investors who purchased
the common stock of Agilent Technologies, Inc. (NYSE:A) during the
period from December 13, 1999 through September 9, 2002, inclusive, in
the United States District Court for the Southern District of New York.
The complaint alleges that CSFB issued analyst reports regarding
Agilent which were false and misleading because they conflicted with
defendants' privately expressed doubts and failed to disclose that
defendants' coverage and ratings of Agilent were not independent and
objective, but instead were biased and a marketing tool for CSFB to
maintain and enhance its investment banking business with Agilent.
Throughout the class period, CSFB maintained "Buy" or "Hold"
recommendations on Agilent in order to obtain and support lucrative
financial deals for CSFB. As a result of CSFB's false and misleading
analyst reports, Agilent common stock traded at artificially inflated
levels during the class period.
On October 21, 2002, the Commonwealth issued a press release announcing
that it had charged CSFB with violating the Massachusetts Securities
Act by issuing false and misleading analyst reports on numerous
companies.
The Commonwealth complaint describes the influence and control exerted
by CSFB's investment bankers on its supposedly independent research
analysts and seeks to order CSFB to separate its investment banking and
research departments and to impose a nearly $2 million fine.
For more details, contact Andrew G. Tolan by Phone: 888-476-6529
((888) 4-POMLAW) by E-mail: agtolan@pomlaw.com or visit the firm's
website: http://www.pomerantzlaw.com
ENDOCARE INC.: Wechsler Harwood Lodges Securities Fraud Suit in C.D. CA
-----------------------------------------------------------------------
Wechsler Harwood LLP initiated a securities class action in the United
States District Court for the Central District of California on behalf
of all purchasers of the common stock of Endocare Inc. (Nasdaq:ENDO)
publicly traded securities during the period between Oct. 23, 2001 and
Oct. 30, 2002, inclusive.
The complaint charges the Company and certain of its officers and
directors with issuing false and misleading statements concerning its
business and financial condition. The Company develops, manufactures,
and markets cryosurgical and stent technological devices for the
treatment of prostate cancer and benign prostate hyperplasia. The
Company is also developing cryosurgical technologies for treating
tumors in organs such as the kidney, breast and liver.
Specifically, the complaint alleges that defendants caused the
Company's shares to trade at artificially inflated levels through the
issuance of false and misleading financial statements. As a result of
this inflation, the Company was able to complete a public offering of 4
million shares, raising proceeds of $68 million on Nov. 16, 2001.
On Oct. 30, 2002, the Company issued a press release entitled,
"Endocare Will Delay Release of Third Quarter Results Until Completion
of Its Review Process." On this news the stock dropped below $3 per
share.
For more details, contact David Leifer by Mail: 488 Madison Avenue, 8th
Floor, New York, New York 10022 by Phone: 877-935-7400 by E-mail:
dleifer@whesq.com or visit the firm's Website: http://www.whesq.com
OM GROUP: Bernstein Liebhard Commences Securities Fraud Suit in N.D. OH
-----------------------------------------------------------------------
Bernstein Liebhard & Lifshitz, LLP initiated a securities class action
in the United States District Court for the Northern District of Ohio
on behalf of all persons who acquired OM Group, Inc. (NYSE: OMG)
securities between the dates of July 30, 2002 and October 29, 2002,
inclusive.
The Company is engaged in the production and sale of metal-based
chemicals -- particularly those containing cobalt or nickel -- used in
paints, inks, ceramics, glassware, televisions, autobodies, airbags,
batteries, and other products.
During the class period, defendants caused OMG to make public
statements that touted OMG's financial health yet failed to disclose
defendants' intention to comprehensively restructure OMG's operations
due to the continuing weak demand for the Company's products.
When, on October 29, 2002, news of the Company's restructuring plan was
revealed, OMG stock dropped more than 71% in a single day's trading, to
close at $8.95 per share. Then, on October 31, 2002, OMG revealed that
Defendant James P. Mooney, OMG's Chief Executive Officer, sold his
entire OMG stock holdings to cover a margin call on a huge loan.
For more details, contact Ms. Linda Flood, Director of Shareholder
Relations by Mail: 10 East 40th Street, New York, New York 10016 by
Phone: 800-217-1522 or 212-779-1414 by E-mail: OMG@bernlieb.com or
visit the firm's Website: http://www.bernlieb.com
QUADRAMED CORPORATION: Kaplan Fox Commences Securities Suit in N.D. CA
----------------------------------------------------------------------
Kaplan Fox & Kilsheimer LLP initiated a securities class action against
QuadraMed Corporation (NASDAQ: QMDCE) and certain of its officers and
directors, in the United States District Court for the Northern
District of California, on behalf of all persons and entities who
purchased the Company's publicly traded securities between April 19,
1999 and October 16, 2002, inclusive.
The Company is a healthcare information and technology company that
provides software solutions and consulting services to hospitals and
medical providers to meet their medical records, business and
compliance needs.
The complaint alleges that throughout the class period, the Company
issued false and misleading financial statements in violation of
Generally Accepted Accounting Principles (GAAP) by improperly
recognizing revenue on software licenses.
After several partial disclosures about the inaccuracy of its financial
statements, on October 16, 2002, QuadraMed finally announced that it
would restate its financial statements for the years ended December 31,
1999, 2000 and 2001 and the quarter ended March 31, 2002 due to the
Company's improper revenue recognition practices.
As a result of the defendants' false and misleading statements, Company
securities traded at artificially high levels during the class period.
For more details, contact Robert N. Kaplan, Hae Sung Nam by Mail: 805
Third Avenue, 22nd Floor, New York, NY 10022 by Phone: (800) 290-1952
by Fax: (212) 687-7714 or by E-mail: mail@kaplanfox.com
SALOMON SMITH: Kaplan Fox Commences Securities Fraud Suit in S.D. NY
--------------------------------------------------------------------
Kaplan Fox & Kilsheimer, LLP initiated a securities class action
against Citigroup Inc., Salomon Smith Barney Inc. and Jack Grubman, in
the United States District Court for the Southern District of New York
on behalf of all persons or entities who purchased or otherwise
acquired the common stock of Metromedia Fiber Network, Inc. (Nasdaq:
MFNX) between November 25, 1997 and July 25, 2001, inclusive.
The complaint alleges that defendants violated the federal securities
laws by issuing analyst reports regarding Metromedia that recommended
the purchase of Metromedia common stock and which set price targets for
Metromedia common stock, without any reasonable factual basis.
The complaint further alleges that, when issuing its Metromedia analyst
reports, defendants failed to disclose significant, material conflicts
of interest which it had, in light of defendants' Metromedia reports,
to obtain investment banking business for Salomon.
Furthermore, in issuing Metromedia reports, in which it recommended the
purchase of Metromedia common stock, defendants failed to disclose
material, non-public, adverse information which they possessed about
Metromedia. Throughout the class period, defendants maintained a "BUY"
recommendation on Metromedia in order to obtain and support lucrative
financial deals for Salomon.
The class period begins on November 25, 1997 the date when Salomon
"initiated coverage" of and issued their first report on Metromedia,
and ends on July 25, 2001, the date Defendants belatedly downgraded
Metromedia from a "Buy" to a "Neutral."
As a result of defendants' false and misleading analyst reports,
Metromedia common stock traded at artificially inflated levels during
the class period.
For more details, contact Frederic S. Fox or Donald R. Hall by Mail:
805 Third Avenue, 22nd Floor, New York, NY 10022 by Phone: 800-290-1952
or 212-687-1980 by Fax: 212-687-7714 or by E-mail: mail@kaplanfox.com
SYNCOR INTERNATIONAL: Charles Piven Launches Securities Suit in C.D. CA
-----------------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities class
action on behalf of shareholders who purchased, converted, exchanged or
otherwise acquired the common stock of Syncor International Corp.
(Nasdaq:SCOR) between April 25, 2001 and November 5, 2002, inclusive,
in the United States District Court for the Central District of
California, against the Company and:
(1) Monty Fu,
(2) Robert G. Funari,
(3) Moses Fu and
(4) William Forester
The action charges that defendants violated federal securities laws by
issuing a series of materially false and misleading statements to the
market throughout the class period which statements had the effect of
artificially inflating the market price of the Company's securities.
For more details, contact Charles Piven by Mail: 401 East Pratt Street,
Suite 2525, Baltimore, Maryland 21202 by Phone: 410-986-0036 by E-mail:
hoffman@pivenlaw.com or visit the firm's Website:
http://www.pivenlaw.com
TENET HEALTHCARE: Mark McNair Launches Securities Fraud Suit in C.D. CA
-----------------------------------------------------------------------
The Law Office of Mark McNair initiated a securities class action
against Tenet Healthcare Corporation (NYSE:THC), on behalf of, and
seeks damages for shareholders who purchased the stock from October 3,
2001 through October 31, 2002, inclusive, in the United States District
Court for the Central District of California.
The suit alleges that the Company and certain of its officers violated
the Securities Exchange Act of 1934, as a result of the defendants'
issuance of false and misleading statements about the Company's
operations and performance, as a result in part of the Company's
violations of Generally Accepted Accounting Principles (GAAP).
Yesterday, the Company announced that David Dennis, its chief corporate
officer and chief financial officer, and Thomas Mackey, its chief
operating officer, are leaving the Company. Today, the Company's
already-battered stock plummeted 46.7% to close at $14.90.
The lawsuit claims that during the class period, defendants
misrepresented that the Company's financial results were due to the
Company's commitment to quality and cost-effective care. Throughout
the class period, defendants repeatedly stated that Tenet's financials
were strong, that the Company's stellar bottom line was attributed to
its state-of-the-art facilities and high-quality patient care, and that
Tenet was consistently achieving record results.
In reality, however, the complaint claims that defendants actually knew
that the quality of Tenet's profits were inflated by, among other
things, a scheme to wrongfully induce patients to undergo unnecessary
and invasive surgeries and coronary procedures. The scheme included
unnecessary heart catheterization, including angiogram and
intravascular ultrasound, stent placement, angioplasty, coronary artery
bypass surgery and heart valve replacement surgery.
Prior to today's dramatic drop, last Thursday the price of THC stock
plunged more than 26 percent after federal prosecutors in Sacramento
filed an affidavit regarding alleged false billing by two doctors at
the company's hospital in Redding, Calif. Numerous reports concerning
the FBI investigation followed.
These disclosures shocked the market, causing Tenet's stock to decline
to less than $29 per share before closing at $28.75 per share on
October 31, 2002, on volume of more than 50 million shares.
For more details, contact Mark McNair by Phone: 30th Street N.W., Suite
500, Washington, D.C, 20007 by Phone: 877-511-4717 or 202-872-4717 by
E-mail: mcnair@justice4investors.com or visit the firm's Website:
http://www.justice4investors.com.
TENET HEALTHCARE: Wolf Popper Launches Securities Fraud Suit in S.D. NY
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Wolf Popper LLP initiated a securities class action against Tenet
Healthcare Corporation (NYSE:THC) and its CEO, Jeffrey C. Barbakow, on
behalf of purchasers of THC securities from the opening of trading on
October 31, 2002 through the halt of trading on October 31, 2002 at
2:41 p.m. (EST), in the US District Court for the Southern District of
New York.
Plaintiff has alleged that defendants knew on October 30, 2002, that
forty agents from the FBI, Office of Inspector General and Internal
Revenue Service had executed search warrants on Tenet's Redding Medical
Center, but failed to disclose this information to investors.
Defendants had a duty to promptly disclose this material information to
investors for the following reasons:
(1) As of October 28, 2002, Tenet was already under a cloud of
suspicion after an analyst at UBS Warburg downgraded its
rating on the Company and issued a report calling into
question Tenet's Medicare outlier payments;
(2) On October 28, 2002, defendants proclaimed to investors in no
uncertain terms that "Tenet is confident that its hospitals
are fully compliant with Medicare rules and regulations,
including those governing outlier payments";
(3) On October 29, 2002, defendants proclaimed, "(W)e are
confident that Tenet hospitals are fully compliant with
Medicare rules and regulations;" and
(4) On October 30-31, 2002, defendants continued making analyst
presentations, and publicly discussed the Company's business,
prospects, revenues and earnings from Medicare, and results of
operations, with full knowledge of what had transpired on
October 30, 2002, and after making the conscious decision to
withhold from the market the existence of the FBI raid on one
of its hospitals.
For more details, contact Michael A. Schwartz by Mail: 845 Third Avenue
New York, NY 10022 by Phone: 212-759-4600 or 877-370-703 or by E-mail:
IRRep@wolfpopper.com.
TENET HEALTHCARE: Scott + Scott Launches Securities Fraud Suit in NY
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Scott + Scott LLC intiated a securities class action in the United
States District Court for the Central District of California against
Tenet Healthcare Corporation on behalf of all persons who purchased or
otherwise acquired the securities of Tenet Healthcare Corporation
(NYSE:THC) from October 3, 2001 through October 31, 2002, inclusive.
The suit alleges that THC and certain of its officers violated the
Securities Exchange Act of 1934 due to defendants' issuance of false
and misleading statements about the Company's operations and
performance, and because of the Company's violations of Generally
Accepted Accounting Principles (GAAP).
The lawsuit claims that during the class period, defendants
misrepresented that THC's financial results were due to the Company's
commitment to quality and cost-effective care. Throughout the class
period, defendants repeatedly stated that Tenet's financials were
strong, that the Company's bottom line was attributed to its state-of-
the-art facilities and high-quality patient care, and that Tenet was
consistently achieving record results.
In reality, however, the complaint claims that defendants actually knew
that the quality of Tenet's profits were inflated by, among other
things, a scheme to wrongfully induce patients to undergo unnecessary
and invasive surgeries and coronary procedures. The scheme included
unnecessary heart catheterization, including angiogram and
intravascular ultrasound, stent placement, angioplasty, coronary artery
bypass surgery and heart valve replacement surgery.
The price of THC stock plunged more than 26 percent last Thursday after
federal prosecutors in Sacramento filed an affidavit regarding alleged
false billing by two doctors at the company's hospital in Redding,
Calif. Numerous reports concerning the FBI investigation followed.
These disclosures shocked the market, causing Tenet's stock to decline
to less than $29 per share before closing at $28.75 per share on
October 31, 2002, on volume of more than 50 million shares.
Late Thursday, the company said Chief Operating Officer Thomas Mackey,
54, retired after 17 years, and that David Dennis, 53, chief corporate
officer and chief financial officer since 2000, had resigned. Today,
the stock price dropped another 48%.
For more details, contact Neil Rothstein or David R. Scott by Phone:
800-404-7770 by E-mail: nrothstein@scott-scott.com or drscott@scott-
scott.com or visit the firm's Website: http://www.scott-scott.com
TXU CORPORATION: Chitwood & Harley Commences Securities Suit in N.D. TX
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Chitwood & Harley commences a securities class action in the United
States District Court for the Northern District of Texas, Dallas
Division, on behalf of all persons who purchased or otherwise acquired
TXU securities from January 31, 2002 through October 11, 2002.
The lawsuit alleges that the Company and certain of its officers and
directors and its underwriters with violations of the Securities Act of
1933 and the Securities Exchange Act of 1934, arising out of
defendants' issuance of false and misleading statements about the
Company's business, operating performance and prospects.
In a November 6, 2002, filing with the U.S. Securities and Exchange
Commission, the Company stated that it will take a charge of $4.2
billion to write off its failed foray into Europe.
The lawsuit claims that the defendants pumped up the company's stock
price by misrepresenting to the investing public the condition of the
Company's European operations throughout the class period. The
complaint says the Company lacked a reasonable basis for its earning
projections for fiscal 2002 and 2003.
Specifically, the defendants misled or failed to tell investors that:
(1) TXU's operations in Europe and, specifically, those in the
United Kingdom were plagued with deficient, inadequate, and
faulty internal and financial controls;
(2) TXU's risk management in Europe was virtually non-existent,
and there was no means of addressing the risk to TXU from the
UK's unregulated electricity market;
(3) At least one credit facility worth approximately $500 million
contained "cross-default" provisions between TXU Europe and
TXU;
(4) TXU's UK operations used wholesale electricity "structured
transactions" to meet earnings goals in violation of Generally
Accepted Accounting Principles by shifting earnings and
profits from one quarterly period to another;
(5) The company's UK operations had entered into and carried long-
term electricity purchase contracts that were "out of the
money" by some $700 million; and
(6) The European operations were impaired and overvalued by
billions of dollars.
According to the complaint, the truth about TXU began to emerge on
October 4, 2002, when the company said it was revising its earnings
expectations for fiscal 2002 and 2003, and in the spate of news
articles and analyst reports that followed. The company revealed more
problems in an October 7, 2002 conference call with analysts.
Company stock plummeted as a result of these disclosures, falling from
a close of $32.90 per share on October 3, 2002 to $13.85 on October 8,
2002.
For more details, contact Nikole Davenport by Mail: 1230 Peachtree
Street, Suite 2300, Atlanta, Georgia 30309 by Phone: 888-873-3999 or
404-873-3900 by E-mail: nmd@classlaw.com or visit the firm's Website:
http://www.classlaw.com
UNDERWRITERS LITIGATION: Kaplan Fox Launches Securities Suit in S.D. NY
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Kaplan Fox & Kilsheimer, LLP initiated a securities class action
against Citigroup Inc., Salomon Smith Barney Inc., and Jack Grubman, in
the United States District Court for the Southern District of New York
on behalf of all persons or entities who purchased the common stock of
Williams Communications Group, Inc. (OTC: WCGOQ.OB) formerly (NASDAQ :
WCGRQ) between October 27, 1997 and November 2, 2001, inclusive.
The complaint alleges that defendants violated the federal securities
laws by issuing analyst reports regarding WCG that recommended the
purchase of WCG common stock and which set price targets for WCG common
stock, without any reasonable factual basis.
The complaint further alleges, among other things, that when issuing
its WCG analyst reports, defendants failed to disclose significant,
material conflicts of interest which it had concerning the WCG reports,
because of Salomon's desire to obtain investment banking business from
WCG. Throughout the class period, Defendants maintained a "BUY"
recommendation on WCG in order to obtain and support lucrative
financial deals for Salomon.
The class period begins on October 27, 1997, at which time Salomon
initiated coverage of WCG common stocks as a "BUY" and ends on November
2, 2001, the date Defendants belatedly downgraded WCG from a "BUY" to a
"NEUTRAL."
As a result of defendants' false and misleading analyst reports, WCG
common stock traded at artificially inflated levels during the class
period.
For more details, contact Frederic S. Fox or Donald R. Hall by Mail:
805 Third Avenue, 22nd Floor, New York, NY 10022 by Phone: 800-290-1952
or 212-687-1980 by Fax: 212-687-7714 by E-mail: mail@kaplanfox.com
VODAFONE GROUP: Wolf Haldenstein Commences Securities Fraud Suit in NY
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Wolf Haldenstein Adler Freeman & Herz LLP initiated a securities class
action in the United States District Court for the Southern District of
New York, on behalf of the purchasers of the American Depositary
Receipt shares (ADRs) of Vodafone Group PLC (NYSE: VOD) between March
7, 2001 and May 28, 2002, inclusive, against the Company and certain of
its officers and directors.
The complaint alleges that defendants violated the federal securities
laws by issuing materially false and misleading statements throughout
the class period that had the effect of artificially inflating the
market price of the Company's securities.
Specifically, the complaint alleges that during the class period,
defendants filed to disclose the following adverse facts, which were
known by defendants or recklessly disregarded by them, among others:
(1) that the migration of telecommunications users from fixed-
wire to wireless services was having a material adverse
effect on the Company. Vodafone, directly and through its
partnerships, had significant investments in fixed-wire
operations, throughout Europe and Japan, which were losing
customers to wireless providers (including the Company);
(2) that the Company was improperly postponing the write-down of
billions of dollars of goodwill and impaired assets, thereby
artificially raising the Company's reported financial
results. In truth, although the defendants' claimed that the
Company had a "solid balance sheet," when the Company
ultimately did write-off the value of its impaired assets and
goodwill, Vodafone eliminated all profits for 2001, 2002 and
possibly beyond;
(3) that the Company had vastly overpaid for the many
acquisitions it had made in prior years, many with inflated
stock; and
(4) based on the preceding, defendants' representation that
Vodafone would continue to sustain its "record of delivering
outstanding performance" was lacking in a reasonable basis.
On May 28, 2002, the Company announced its financial results for the
fiscal year 2002, the period ending March 31, 2002, which consisted of
massive write downs for good will of nearly 13.47 billion pounds
sterling and exceptional items and operating costs of 5.4 billion
pounds and exceptional non-operating costs of 865 million pounds.
For more details, contact Fred Isquith, Lawrence Kolker, Michael Miske,
George Peters or Derek Behnke by Mail: 270 Madison Avenue, New York,
New York 10016 by Phone: 800-575-0735 by E-mail: classmember@whafh.com
or visit the firm's Website: http://www.whafh.com. All e-mail
correspondence should make reference to Vodafone.
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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
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Beard Group, Inc., Washington, D.C. Enid Sterling, Aurora Fatima
Antonio and Lyndsey Resnick, Editors.
Copyright 2002. All rights reserved. ISSN 1525-2272.
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