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/raid1/www/Hosts/bankrupt/CAR_Public/030312.mbx C L A S S A C T I O N R E P O R T E R Wednesday, March 12, 2003, Vol. 5, No. 50 Headlines APPLIED DIGITAL: Reaches Agreement To Settle Securities Suit in S.D. FL ATI TECHNOLOGIES: Fairness Hearing For Suit Settlement Set April 2003 BRISTOL-MYERS SQUIBB: Maine Reaches Settlement In Buspar Antitrust Suit BROCADE COMMUNICATIONS: NY Court Dismisses Consolidated Securities Suit CALIFORNIA: Two Buses Crash on Interstate 15, Forty Passengers Injured CALIFORNIA: Disability Rights Advocates Sue Over Rehab Center Closure CANADA: Toll-Highway Firm To Reimburse Late Fees To Customers in Suit CENDANT CORPORATION: Court Dismisses Claims V. Firm in Homestore Suit CONSTELLATION ENERGY: Hearing on CA Power Contracts Suit Set March 2003 CONSTELLATION ENERGY: Faces Lawsuits Alleging Mercury Poisoning in MD CONSTELLATION ENERGY: Briefing on Suit Certification To End July 2003 CRACKER BARREL: Court Denies Certification of Race Discrimination Suit IDAHO POWER: Named as Defendant in Energy Producers Lawsuit in W.D. WA IDAHO POWER: Named As Defendant in Suit V. Energy Producers in Oregon JEFFERSON-PILOT CORPORATION: Reaches Agreement To Settle Consumer Suit MORTGAGE SERVICERS: Face Tougher Rules in New Consumer Protection Bill NATIONAL BANK: Plaintiffs File Amended Suit For RICO, ERISA Violations PHILIP MORRIS: Closing Arguments To Commence In "Light" Cigarette Trial TOBACCO LITIGATION: Parties In Lights Lawsuit Go Public, Await Verdict VIVENDI UNIVERSAL: Asks NY Court To Dismiss Securities Fraud Lawsuit *Wall Street Firms Finally Getting The Message About Sexual Harassment Meetings, Conferences & Seminars * Scheduled Events for Class Action Professionals * Online Teleconferences New Securities Fraud Cases ADC TELECOMMUNICATIONS: Cauley Geller Commences Securities Suit in MN ADC TELECOMMUNICATIONS: Schiffrin & Barroway Lodges MN Securities Suit ADC TELECOMMUNICATIONS: Glancy & Binkow Lodges Securities Lawsuit in MN ALLOY INC.: Schiffrin & Barroway Lodges Securities Lawsuit in S.D. NY ASTROPOWER INC.: Schiffrin & Barroway Files Securities Suit in DE Court LIPPER CONVERTIBLES: Cohn Lifland, Kucker & Bruh File Securities Suit PARAMETRIC TECHNOLOGIES: Marc Henzel Commences Securities Lawsuit in MA PARAMETRIC TECHNOLOGIES: Stull Stull Commences Securities Lawsuit in MA PARAMETRIC TECHNOLOGIES: Chitwood & Harley Lodges Securities Suit in MA ********* APPLIED DIGITAL: Reaches Agreement To Settle Securities Suit in S.D. FL ----------------------------------------------------------------------- Applied Digital Solutions, Inc. (Nasdaq: ADSX) has reached a memorandum of understanding to settle the consolidated securities class action filed in the United States District Court for the Southern District of Florida on behalf of all persons who purchased the Company's common stock from February 11, 2000 through May 10, 2002, inclusive. According to an earlier Class Action Reporter story, the primary allegations in the recently filed amended consolidated suit include claims that: (1) the Company recklessly engaged in a strategy of acquiring subsidiaries without regard to any strategic worth; (2) the Company lacked the necessary accounting controls over its subsidiaries; (3) the Company manipulated its stock price through the issuance of press releases; and (4) the Company's statements about its Intellesale, Inc. and VeriChip Corporation subsidiaries were false and misleading. The settlement involved no admission of liability and will be entirely covered by proceeds from insurance. The settlement is subject to various conditions, including court approvals and approval of a special litigation committee of the Company's board of directors. ATI TECHNOLOGIES: Fairness Hearing For Suit Settlement Set April 2003 --------------------------------------------------------------------- The United States District Court for the Eastern District of Pennsylvania has set for April 25,2003 the fairness hearing for the US$8 million settlement proposed by ATI Technologies, Inc. to settle the class action filed against it, and certain of its officers and directors. The shareholders alleged in their lawsuits that the company made material misleading statements and engaged in omissions of relevant information before a May 2000, earnings warning. Chief Financial Officer Terry Nickerson said insurance will cover about US$3 million of the settlement of lawsuits filed in May 2001, according to an earlier Class Action Reporter story. In July 2002, the Court dismissed all claims in the litigation except as to the alleged misrepresentations and omissions concerning ATI's RAGE 4 1/4RAGE 128 and RAGE 5 1/4RAGE 128 PRO products and inventory. A stipulation and agreement of settlement has been executed and filed with the court. The terms of the stipulation and agreement of settlement, which are subject to final court approval and notice to class members, include no admission of liability or wrongdoing by the company or other defendants. BRISTOL-MYERS SQUIBB: Maine Reaches Settlement In Buspar Antitrust Suit ----------------------------------------------------------------------- Bristol-Myers Squibb reached a preliminary settlement with Maine, in the federal class action it filed 14 months ago against the Company and other drug manufacturers over illegally blocking competition for generic drugs, resulting in inflated prices for BuSpar, a popular anti- anxiety drug, the Portland Press Herald reports. Maine is joining 34 states, Puerto Rico and the District of Columbia in seeking court approval of the proposed settlement with Bristol-Myers, the maker of BuSpar. The lawsuit alleged that Bristol-Myers Squibb misrepresented its patent rights over BuSpar, causing the federal Food and Drug Administration (FDA) to extend the company's monopoly by blocking generic competitors. The attorney general said the defendants, including Bristol-Myers, Watson Pharma Inc. and Danbury Pharmacal Inc., have agreed to pay the plaintiffs more than $90 million to settle the case. If the court approves the proposed BuSpar settlement, a nationwide consumer fund will be established and adminstered by the states. The fund will be designed to compensate consumers who can prove that they bought BuSpar between January 1, 1998, and January 31, 2003. Consumers who were taking BuSpar during that period may be eligible to receive as much as $300, Mr. Rowe said. Maine state agencies that bought BuSpar at inflated prices will be eligible to receive up to $500,000. The Maine Medicaid program spent $500,000 on BuSpar during the period at issue in the case. Under the settlement's terms, Bristol-Myers is prohibited from attempting to re-list the BuSpar patent with the FDA. The company has had a monopoly on the product since it was first approved by the FDA in 1986. BROCADE COMMUNICATIONS: NY Court Dismisses Consolidated Securities Suit ----------------------------------------------------------------------- The United States District Court for the Southern District of New York dismissed the consolidated securities class actions filed against Brocade Communications, Inc., certain of its officers and directors, and certain of the underwriters for the Company's initial public offering. The suit alleged that various underwriters engaged in improper and undisclosed activities related to the allocation of shares in the Company's initial public offering of securities. The complaint seeks unspecified damages on behalf of a purported class of purchasers of common stock from May 24, 1999 to December 6, 2000. In March 2002, the court entered an order dismissing without prejudice all claims against the Company and its officers and directors named in the consolidated proceeding. In October 2002, the individual defendants were dismissed without prejudice from the action. In February 2003, the court entered an order dismissing all of the plaintiffs' claims against the Company. No appeal has been filed. CALIFORNIA: Two Buses Crash on Interstate 15, Forty Passengers Injured ---------------------------------------------------------------------- Two tour buses crashed into each other on California's southbound Interstate 15, critically injuring eight passengers and injuring dozens of others, the Associated Press reports. The crash happened Sunday, March 10, at about 3:20 pm, between a Gold & Silver Charter Bus, Inc. bus and a Hebaragi & Lemi Bus, Inc. vehicle. The accident caused both southbound lanes to be closed for five hours and resulted in a commuter nightmare for Californians heading home from Las Vegas. California Highway Patrol Officer Adam Cortinas estimated the buses were traveling about 55 mph through an area undergoing road construction when the Gold & Silver Charter bus hit the rear of the Hebaragi & Lemi bus. The speed limit in the area is 70 mph but is slower in construction zones, the Associated Press reports. The Hebaragi & Lemi bus had rear-ended another car, which prompted the collision between the two buses, said Sgt. Stan Clair of the CHP. "Everybody was crying and screaming, and blood was gushing from those who were injured," passenger Ruth Frost told Fox affiliate KTTV-TV in Los Angeles. Hebaragi & Lemi general manager Eric Song told AP investigators told him that one of the company's 56 passengers experienced chest pain and was taken to a hospital. The remaining 55 passengers were placed on another bus and were en route back to Los Angeles, he said. Gold & Silver could not be reached for comment. CALIFORNIA: Disability Rights Advocates Sue Over Rehab Center Closure --------------------------------------------------------------------- A coalition of disability rights advocates recently filed a class action in the US District Court in California to stop Los Angeles County from closing the well-known, much-respected Rancho Los Amigos National Rehabilitation Center, the Los Angeles Times reports. Also joining in the suit are Protection and Advocacy, Inc., the Western Center on Law and Poverty, the National Senior Citizens Law Center and the law firm of Kirkland & Ellis. The lawsuit says the closing would violate the federal Americans With Disabilities Act and other legislation prohibiting discrimination on the basis of disabilities, because many patients would have nowhere else to turn for treatment. The lawyers in the lawsuit say they are suing on behalf of about 5,000 Rancho patients who are recipients of Medi-Cal, the government insurance program for the poor and disabled. County supervisors say they have no alternative because of a looming budget deficit in the Health Services Department. County Health Director Thomas Garthwaite, however, has not been a proponent of Rancho, even though it performs miracles, he says, because it is far too expensive to run. Nearly a third of its patients are indigent, and the county estimates it would have to pay $15 million to $30 million a year just to cover uninsured patients. The county projects it will save about $194 million over the next three years by closing the center. That is the arithmetic of the center, which does not seem likely to go away even if it survives the present crisis by some kind of patch-up "fix." A certain amount of imaginative thinking has been going on, and the California Community Foundation hopes to save the hospital by turning it into a non-profit organization. A foundation study determined that Rancho could be a fund-raising powerhouse like other rehabilitation hospitals of its stature. Foundation President Jack Shakely is scheduled to report to the Board of Supervisors by April on funding commitments he has procured. "The health-care system is in crisis," said Eve Hill, director of the Western Law Center for Disability Rights. "But whatever the cost- benefit analysis of a life, the answer cannot be to deny health care completely to a community, based on disability, race, gender, poverty or any other characteristic." Concluding with a comment suggesting cuts must be spread throughout a community, Ms. Hill said if the county cuts services it must do so more equitably. CANADA: Toll-Highway Firm To Reimburse Late Fees To Customers in Suit --------------------------------------------------------------------- Negotiators in a class action over a toll-highway company charging customers unreasonable late fees, agreed to a proposed settlement by whose terms 407 ETR, the company, would reimburse millions of dollars to customers who paid those unreasonable late fees, the Toronto News reports. Richard Prendiville, who filed the class action, sent 407 ETR a check for his outstanding balance. While it was in the mail on its way to 407 ETR, a 12-cent charge accrued on Mr. Prendiville's account. When the company received the check, and credited it to his account, there still remained a balance of 12 cents due on his account. He was fined a $30 late fee, at an interest rate far above the Criminal Code's maximum allowable interest of 60 percent annually. Under the terms of the settlement, 407 ETR will offer a $6 credit to 840,000 customers who were charged the $30 late fee. Any customers, such as Mr. Prendiville, who was charged the late fee as a result of an administrative error, will be credited $30. Martin Doane, a lawyer representing the plaintiffs, including Mr. Prendiville, said, "There is nothing wrong with charging a late fee, but the fee has to be directly related to the company's costs of collecting late payments." Following upon the filing of the class action and the settlement arising out of the negotiations, the company undertook some changes: (1) beginning April 7, 2003, the company would charge $12.50 when a customer has not paid the bill in three months. The company would charge another $12.50 when it must resort to other means to collect payment; and (2) responding to the complaints of customers that they were unable to inform the company about payments, the company hired more staff, so that the average waiting time to speak with a representative would be less than 17 seconds; "They have totally revamped the consumer process, largely due to the class action lawsuit," said Mr. Doane. CENDANT CORPORATION: Court Dismisses Claims V. Firm in Homestore Suit --------------------------------------------------------------------- The US District Court in Los Angeles, California dismissed with prejudice all claims made against Cendant Corporation and Cendant Real Estate Division Chairman Richard A. Smith in the class action filed against Homestore, Inc., its former executives and other firms by the California State Teachers Retirement System (CALSTeRS). The lawsuit charges that Homestore, former CEO Stuart Wolff, former COO Peter Tafeen and a number of others used bogus sales transactions to falsify the company's earnings reports so the results would meet Wall Street analysts' revenue projections. The executives are accused of using the phony financial statements to pump up the company's stock price and pocket allegedly ill-gotten gains through the exercise of stock options and sale of company stock, Inman News Features reports. "As we have asserted from the outset, this lawsuit had no merit. We are pleased that the court agreed," Cendant General Counsel James E. Buckman told Inman. The $92 billion pension fund joined the $1 billion lawsuit to recover $9 million in investment losses and to make a point about investor control of corporate governance, according to a spokesperson. Mike Long, who was named CEO of Homestore after Wolff's resignation in January 2002, has said the company would like to settle the lawsuit. That will be difficult due to the large number of plaintiffs whose interests may differ from Homestore's own aims. CONSTELLATION ENERGY: Hearing on CA Power Contracts Suit Set March 2003 ----------------------------------------------------------------------- Hearing for the class action filed against Constellation Power Development, Inc. and other energy companies has been set for March 2003 in the Superior Court, County of San Francisco. The suit seeks damages of $43 billion, recession and reformation of approximately 38 long-term power purchase contracts, and an injunction against improper spending by the state of California. The Company is named as a defendant but does not have a power purchase agreement with the State of California. However, the Company's High Desert Power Project does have a power purchase agreement with the California Department of Water Resources. In 2002, the court issued an order to the plaintiff asking that he show cause why he had not yet served the defendants. In April 2002, a second show cause order was issued. After several postponements, a hearing is now scheduled on that order. CONSTELLATION ENERGY: Faces Lawsuits Alleging Mercury Poisoning in MD --------------------------------------------------------------------- Constellation Energy, Inc. faces several claims alleging mercury poisoning from several sources, filed in the Circuit Court for Baltimore City, Maryland. The suits also name as defendants Baltimore Gas & Energy (BGE) and several other defendants. The suits allege mercury poisoning from several sources, including coal plants formerly owned by BGE. The plants are now owned by a subsidiary of Constellation Energy. In addition to BGE and Constellation Energy, approximately 11 other defendants, consisting of pharmaceutical companies, manufacturers of vaccines and manufacturers of Thimerosal have been sued. Approximately 50 cases have been filed to date, with each case seeking $90 million in damages from the group of defendants. The plaintiffs have filed motions to remand the cases back to the Baltimore City Circuit Court. At this time no discovery has occurred. The Company believes that it has meritorious defenses and intends to defend the action vigorously. However, the Company cannot predict the timing, or outcome, of these cases, or their possible effect on its financial results. CONSTELLATION ENERGY: Briefing on Suit Certification To End July 2003 --------------------------------------------------------------------- Constellation Energy Group, Inc. faces a racial discrimination class action pending in the United States District Court for the District of Maryland. The suit also names as defendants Baltimore Gas and Electric Company, and Company subsidiaries Constellation Nuclear, and Calvert Cliffs Nuclear Power Plant. The action seeks class certification for approximately 150 past and present employees and alleges racial discrimination at Calvert Cliffs Nuclear Power Plant. The amount of damages is unspecified, however the plaintiffs seek back and front pay, along with compensatory and punitive damages. The court scheduled a briefing process for the motion to certify the case as a class action. The briefing process is scheduled to end in July 2003. The Company does not believe class certification is appropriate and further believes that it has meritorious defenses to the underlying claims. However, it cannot predict the timing, or outcome, of the action or its possible effect on its financial results. CRACKER BARREL: Court Denies Certification of Race Discrimination Suit ---------------------------------------------------------------------- The United States District Court in the Northern District of Georgia denied certification of a class action in a four-year-old lawsuit against Cracker Barrel Old Country Store, Inc., which alleged discrimination against African-American employees at the company's restaurants. In a 175-page ruling issued on March 7, 2003, Federal Judge Harold Murphy said the employees had failed to make the case that their lawsuit should be certified as a national class action. Judge Murphy said "The Court . concludes that the statistical evidence simply does not demonstrate that the Defendant engaged in a consistent pattern of adverse treatment of African-Americans." It was the second time in six months that Judge Murphy rejected a class action against the Company brought by the same attorneys. In a 64-page decision on October 1, Judge Murphy ruled a group of African-American customers of Cracker Barrel and their attorneys had failed to prove that a common set of circumstances existed to justify a national class action. "We are very pleased with the court's ruling, which supports what we have said from the beginning," Cracker Barrel President and Chief Operating Officer Donald M. Turner said in a statement. "In both lawsuits, there was simply no evidence Cracker Barrel engaged in a pattern of discrimination against African-Americans - either our employees or our customers." Mr. Turner noted the ruling in the employee case was especially gratifying because "we take a great deal of pride in the fact that we treat all of our employees with dignity and respect." Cracker Barrel has a proven record of promoting African-Americans and placing them in positions of major responsibility, Turner said. About 23 percent of Cracker Barrel's more than 50,000 employees are minorities, he said. Some 13 percent are African-American. According to Mr. Turner, more than 7 percent of the company's store managers are African-American, and the company's three top executives who handle human resources, employee training, and purchasing also are African- Americans. "This simply isn't the profile of a business that engages in a pattern or practice of discrimination," he said. The case started in October, 1999, when plaintiffs' attorneys representing a group of 13 African-American employees or former employees held a news conference in Atlanta, GA, to announce they were pursuing a class action against Cracker Barrel for alleged incidents of racial discrimination. For more details, contact Julie Davis of CBRL Group Inc., Lebanon by Phone: 615/443-9266 or visit the firm's Website: http://www.crackerbarrel.com IDAHO POWER: Named as Defendant in Energy Producers Lawsuit in W.D. WA ----------------------------------------------------------------------- Idacorp, Inc. was named as a defendant in a class action filed in the United States District Court for the Western District of Washington in Seattle, against various energy firms, on behalf of all persons and businesses residing in Washington who were purchasers of electrical and/or natural gas energy from any period beginning in January 2000 to the present. The complaint alleges claims under the Washington Consumer Protection Act, RCW 19.86, as well as common law claims of fraud by concealment, negligence and for an accounting. The complaint asserts that the defendants, including the Company, engaged in, among other things, unfair and deceptive acts, in violation of the Federal Power Act, by (1) withholding the supply of energy; (2) misrepresenting the amount of its energy supplies; (3) exercising improper control over the energy markets; and (4) manipulating the price of energy markets resulting in energy rates being unjust, unreasonable and unlawful The Company's response to the complaint is due within 30 days from the date of service. The Company intends to vigorously defend against this lawsuit and believes this matter will not have a material adverse effect on its consolidated financial position, results of operations or cash flows. IDAHO POWER: Named As Defendant in Suit V. Energy Producers in Oregon --------------------------------------------------------------------- Idaho Power Corporation, along with other power firms, face a class action pending in the United States District Court for the District of Oregon, on behalf of all persons and businesses residing in Oregon who were purchasers of electrical and/or natural gas energy from any period beginning in January 2000 to the present. The suit, initially filed in the Circuit Court of the State of Oregon for the County of Multnomah, alleges claims under the Oregon Unfair Trade Practices Act, ORS 646.605 et seq. in addition to claims of fraud by concealment, negligence and for an accounting. The complaint asserts that the defendants, including the Company, engaged in, among other things, unfair and deceptive acts, in violation of the Federal Power Act, by: (1) withholding the supply of energy; (2) misrepresenting the amount of its energy supplies; (3) exercising improper control over the energy markets; and (4) manipulating the price of energy markets resulting in energy rates being charged to Oregon energy consumers that were unjust, unreasonable and unlawful The plaintiff seeks certification of a class action, equitable and injunctive relief, an accounting, attorneys' fees and costs. The Company intends to seek an extension of time to respond. The Company further intends to vigorously defend against this lawsuit and believes this matter will not have a material adverse effect on its consolidated financial position, results of operations or cash flows. JEFFERSON-PILOT CORPORATION: Reaches Agreement To Settle Consumer Suit ---------------------------------------------------------------------- Jefferson-Pilot Corporation reached an agreement with plaintiffs in a class action filed on behalf of 165,000 holders and beneficiaries of certain Excess Interest Whole Life and Participating Whole Life policies, most of which were sold in the 1980s and early 1990s, regarding the manner in which their policies were sold, serviced and administered. The settlement is subject to final court approval later this year. In the settlement, the Company denies any allegations of wrongdoing. The Company believes that its sales, servicing and administrative practices are - and always have been - designed to match customers' needs with appropriate products and to fully inform customers about the operation and features of those products. Among other things, the settlement will provide class policyholders free term life insurance and the opportunity to purchase additional life insurance and annuity policies enhanced with special premium and interest bonuses paid by the company. It will benefit Jefferson Pilot by resolving and eliminating the need for corporate resources to be spent on a lawsuit that has been pending for seven years. Management believes its current accruals for litigation expense are adequate. Policyholders entitled to receive benefits will receive written notification and detailed disclosure regarding policyholder benefits provided under the settlement. For more details, contact Paul E. Mason, Vice President of Corporate Affairs of Jefferson Pilot Financial by Phone: 1-336-691-3313 by E- mail: http://www.jpfinancial.com MORTGAGE SERVICERS: Face Tougher Rules in New Consumer Protection Bill ---------------------------------------------------------------------- A new consumer protection bill on Capitol Hill focuses attention on an issue that millions of homeowners deal with routinely - their rocky relationships with the firms that "service" their mortgages, the Orlando Sentinel reports. The bill, sponsored by Rep. Robert Andrews (D-NJ) would expand the homeowners' abilities to initiate class actions against their servicers for botched payments from their escrow accounts, among other foul-ups. Servicing is the administering of the monthly mechanics of the consumer's home loan -- sending out statements, keeping track of the consumer's payments, assessing late fees, making disbursements from the consumer's escrow account, canceling private mortgage insurance, responding to complaints and requests for information. The servicer may be a different company from the one that originally made the loan to the consumer. The servicer essentially handles the workaday details of the loan and receives a fee from the owner of the loan. The issue plaguing the consumer? What are her/his legal rights in relation to the servicer? What are the consumer's rights when the servicer botches the escrow account, failing to make an on-time payment for the property insurance, property taxes or other fees? A new legislative proposal in the House of Representatives would add accuracy and timeliness in escrow account disbursements to the list of legal rights that homeowners already have in connection with their home mortgages. The bill, known as the Homeowners Escrow Payments Assurance Act (H.R. 650) would expose servicers to treble damage awards for any failure to make timely payments from escrow accounts for property insurance, taxes or other escrow items. At a time when the legislative hall across the nation are replete with bills to curtail the average citizen's rights in many areas of her/his life, including the right to sue, Rep. Andrews' bill is reassuring. NATIONAL BANK: Plaintiffs File Amended Suit For RICO, ERISA Violations ---------------------------------------------------------------------- Plaintiffs in the class action against the National Bank of Commerce filed an amended suit on behalf of participants of Corky's Bar-B-Que retirement plan, through its co-trustees, its plan participants and on behalf of all similarly situated retirement plans and their plan participants. The suit also names as defendants First Mercantile Turst, First Mercantile Capital Management and First Mercantile directors and officers Kenneth Lenoir and Scot Lenoir. Corky's has since withdrawn as a named plaintiff and an amended complaint has been filed adding two other named plaintiffs and the bank's parent National Commerce Financial Corporation as defendants. The suit alleges that the Lenoirs, First Mercantile and First Mercantile Capital violated the Employee Retirement Income Security Act (ERISA), the Investment Advisers Act, and conducted an enterprise under the Racketeer Influenced and Corrupt Organizations Act (RICO), by disclosing one fee for retirement plan administration and investment services but actually collecting a different, higher fee for those services. The suit also alleges that the Company and NCF violated ERISA by transferring plans from the Company to First Mercantile for administration and investment services, conspired with the other defendants and facilitated the RICO enterprise, and exercised dominion and control over First Mercantile justifying imputation of First Mercantile's conduct to the Company and NCF. The plaintiffs seek certification of a class allegedly consisting of 2,300 plans with over 100,000 plan participants and beneficiaries, rescission of all contracts between First Mercantile and putative class members, restoration to putative class members of all funds placed with First Mercantile, disgorgement of all fees paid, prejudgment and post- judgment interest, attorneys' fees and costs. The plaintiffs also seek a declaration that a mid-October, 2002, agreement between First Mercantile and a significant number of retirement plans regarding the fee issue is null and void. The Company obtained the mid-October 2002 agreement from affected customers after it determined that certain client information and agreements were out of date and that some lacked documentation with reference to trustee's fees being collected for services rendered to the customers and plans. The amended complaint alleges an unspecified amount of compensatory damages and also seeks any damages to be tripled under RICO. The defendants have vigorously defended this suit to date and will continue doing so. The amount of damages awarded, if any, which could result if the plaintiffs were to prevail in their suit cannot be determined as no hearings have occurred with respect to the appropriateness of class certification. PHILIP MORRIS: Closing Arguments To Commence In "Light" Cigarette Trial ----------------------------------------------------------------------- Testimony has ended in the Madison County, Illinois, trial of a class action against Philip Morris, accused of defrauding smokers of "light" cigarettes. Closing arguments were given Monday, and both sides will have three hours to address Circuit Court Judge Nicholas Byron who has said he hopes to render his ruling the same day, Associated Press Newswires reports. Attorney for the plaintiffs Stephen Tillery said he plans to ask Judge Byron to award $7.1 billion in compensatory damages to the class members. Mr. Tillery said he plans to ask the court to assess punitive damages as well. He also said he has not decided on the amount he will ask for in punitive damages, except that the amount will be at least double the amount sought in compensatory damages. The lawsuit claims Philip Morris defrauded about 1.1 million Illinois smokers by leading them to believe Marlboro Lights and Cambridge Lights are safer than regular cigarettes. The plaintiffs have argued that light cigarettes actually are more harmful; partly, because of the way people smoke them to get more nicotine per puff, and partly because the air vents on light cigarettes affect their toxicity. Expert witnesses were called in the course of the trial to testify to plaintiffs' claims. Philip Morris attorneys argued that the company has never claimed light cigarettes are safer than regular cigarettes. Philip Morris claims the government labeled light cigarettes safer, based on government testing. The company further contended that the smokers of light cigarettes should not be awarded any money since they lost none, because light cigarettes cost the same as regular cigarettes. The lawsuit does not seek compensation for smoking-related illness. TOBACCO LITIGATION: Parties In Lights Lawsuit Go Public, Await Verdict ---------------------------------------------------------------------- The two sides in the class action relating to Philip Morris's light cigarettes, conducted a kind of public relations blitz on Friday while waiting for the verdict expected from Madison County Circuit Judge Nicholas Byron on Monday, the Belleville News-Democrat reports. The plaintiffs' attorneys held a teleconference Friday morning for reporters to speak with three scientists who testified during the trial, in which the plaintiffs were trying to prove that Philip Morris misled consumers about the safety of the light cigarettes manufactured by the company. Philip Morris countered with its own news teleconference Friday afternoon, with company Vice President William Ohlemeyer noting that Madison County had more class actions filed last year than any other county in the country. "I think the facts are the facts about Madison County," Mr. Ohlemeyer said. The plaintiffs' allege that Philip Morris led smokers of Marlboro Lights and Cambridge Lights to believe those cigarettes are safer than regular cigarettes. The plaintiffs' attorneys plan to ask for a judgment of $7 billion in compensatory damages and at least 14 billion in punitive damages. During the plaintiffs' teleconference, Dr. William Farone, a chemist who had directed research at Philip Morris from 1976 to 1984, described Philip Morris's business practices as "diabolical." Dr. Farone said he thought he was being employed by Philip Morris to make cigarettes safer, but discovered Philip Morris was not interested in producing a safer cigarette that delivers less tar because it would be easy to quit smoking that type of cigarette. He said he still felt responsible for smoking-related deaths. He said a fellow researcher was so distraught about working for Philip Morris that she committed suicide by drinking liquid nicotine. "That woman is on my mind constantly," Dr. Farone said. Dr. Farone said that Philip Morris designed its light brands with tiny ventilation holes that allow those cigarettes to perform well on government test machines. Twenty-three smokers from across Illinois testified at the trial that they were influenced by the words "lowered tar and nicotine" on packages of light cigarettes. "Every one of them thought lower tar and nicotine would be safer," said Belleville attorney Stephen Tillery, who represents the plaintiff class. However, the light cigarettes are actually more harmful to smokers because people puff on them harder or more often and also because the addition of air affects the chemistry, according to the plaintiff attorneys. Dr. Peter Shields, an oncology professor at Georgetown, who also testified for the plaintiffs, said studies have shown an increase in cancers on the outside part of the lungs in places where light cigarettes are sold. He said the increase is 10-fold in women and 17- fold in men. He called the introduction of light cigarettes "an interesting experiment on people." The lawsuit does not seek compensation for illness. Rather, it claims that about 1.1 million Illinois smokers should be compensated for economic losses because they did not get the product they thought they were buying. However, Mr. Ohlemeyer said smokers of light cigarettes have suffered no economic loss because light cigarettes cost the same as regular cigarettes. He added that packages of light cigarettes have always contained the same health warning that is on regular Marlboro cigarettes. "The fact of the matter is, Philip Morris has always done what the government and Federal Trade Commission has told them to do," said Mr. Ohlemeyer. The Philip Morris case is the first class action that has gone to trial in Madison County. The plaintiffs and defendants, instead, resolve the issues through a settlement. VIVENDI UNIVERSAL: Asks NY Court To Dismiss Securities Fraud Lawsuit -------------------------------------------------------------------- Beleaguered French media giant Vivendi Universal asked the United States District Court for the Southern District of New York to dismiss a securities class action filed by American shareholders against the Company, its former chairman Jean-Marie Messier and its former chief financial officer Guillaume Hannezo. The suit, filed on behalf of shareholders who acquired Company securities between February 11, 2002 and July 3, 2002, inclusive, charges that defendants violated the 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, an earlier Class Action Reporter story states. According to the Financial Times, the Company says the court does not have the authority to rule on the case because the main decisions affecting the group were taken in France, most members of the board were Europeans and the shares listed on the New York stock market accounted for only 8.9 per cent of the total. *Wall Street Firms Finally Getting The Message About Sexual Harassment ---------------------------------------------------------------------- Some big investment banks are taking seriously complaints of sexual harassment. One of them, J.P. Morgan Chase, took swift, severe, no- nonsense action last week against two high-ranking and highly paid employees, the Houston Chronicle reports. In a society in which the women at the brokerage firms and on the trading floors, where they have been subjected to insulting, demeaning treatment, no longer just "take it," but go out and sue, and win, the brokerage firms know the publicity they will receive, during the course of the litigation and in the media, will tarnish their reputations irrevocably. J.P. Morgan Chase recently dismissed two investment bankers, one of whom was a managing director and is a son of the former king of Sikkim. A group of investment bankers from J.P. Morgan Chase attended a party in Manhattan given by one of their colleagues, and later a small group of the bank's employees went to a bar, where the two bankers, who subsequently were dismissed, observed a woman, a less-senior investment banker, who worked with them at J.P. Morgan. The two bankers approached her and made unwanted, inappropriate advances toward her, according to later accounts by witnesses. They pressed against the unidentified woman, sandwiching her between them with their bodies. When the woman protested, another high-ranking banker intervened, according to witnesses. He later reported the incident to the firm's personnel department, which investigated. The woman and other J.P. Morgan employees who were at the bar, supported that account of events. When confronted by officials of the firm about their behavior, the two investment bankers did not dispute that their conduct had been inappropriate, current and former employees of the firm have said. The two bankers who were dismissed are Palden Gyuimed Namgyal and Norman Gretzinger. Mr. Namgyal was a managing director, and Mr. Gretzinger, a vice-president. They were consumer-products bankers who handled the sales of well-known companies, like Domino's Pizza, StarKist tuna, Playtex Products. People who have worked with the two men said their job performances were not factors in their dismissal. The two men, who live in Bronxville, New York, declined to comment on their dismissals. On Wall Street, any indication that an employee was fired for cause is considered a big obstacle to finding work again in the industry. "It will be very difficult, particularly in this economy, to find another job," said Janet Hanson, a money manager who founded 85 Broads, a network of women who have worked at Goldman Sachs. Employees in many industries are routinely fired for harassment and discrimination. That has not been the case on Wall Street where brokerage firms and trading floors have largely retained reputations as places where such behavior goes unpunished. However, the times may be changing, as firms have more recently been sued by women who have complained of unfair, demeaning treatment, and won their cases, and a great deal of publicity. Two of the biggest brokerage firms, Merrill Lynch and the Smith Barney unit of Citigroup, settled class actions filed by female brokers in the 1990s. The Equal Employment Opportunity Commission is suing another big securities firm, Morgan Stanley, on behalf of women who worked in its investment bank. A trial in that case is expected to begin later this year. "This goes right under the category of ethics. We are in a whole new climate," said Janet Hanson, who, as indicated below, founded 85 Broads, a network of women who have worked at Goldman Sachs. "This may be the beginning of companies behaving in a very, very different manner because the liability is too great. The Street is getting that message." Mr. Namgyal, 39, is the son of Palden Thondup Namgtyal, who was the last king of Sikkim, a tiny protectorate in the Himalayas that is now part of India. Mr. Namgyal's mother is Hope Cooke, an American. Mr. Namgyal and his family were royalty for part of Mr. Namgyal's childhood. When he was 9, his mother moved with him and his sister to New York. India took away the powers of the king and later annexed Sikkim. Meetings, Conferences & Seminars * Scheduled Events for Class Action Professionals ------------------------------------------------- March 13-14, 2003 MOLD INSURANCE LITIGATION CONFERENCES - FEATURING A KEYNOTE ADDRESS BY MELINDA BALLARD Bridgeport Continuing Education Los Angeles Contact: 818-505-1490 March 17-18, 2003 FEN-PHEN LITIGATION CONFERENCE Mealey Publications The Fairmont Hotel, Dallas Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com March 20-21, 2003 FUNDAMENTALS OF INSURANCE COVERAGE LAW Mealey Publications The Westin Hotel, Philadelphia Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com March 23-24, 2003 CALIFORNIA ENVIRONMENTAL UPDATE Bridgeport Continuing Education Long Beach Contact: 818-505-1490 March 27-28, 2003 ASBESTOS LITIGATION Hotel Nikko, San Francisco Contact: 1-888-224-2480; http://www.americanconference.com April 2-5, 2003 INSURANCE INSOLVENCY & REINSURANCE ROUNDTABLE Mealey Publications The Fairmont Scottsdale Princess, AZ Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com April 3, 2003 ASBESTOS LITIGATION CONFERENCE: THE NEW BATTLEGROUND Glasser Legalworks New York Helmsley Hotel, New York City Contact: 800-308-1700; 973-890-0058 April 4-5, 2003 TOXIC TORT IN CALIFORNIA Bridgeport Continuing Education San Francisco Contact: 818-505-1490 April 4-5, 2003 TOXIC TORT AND ENVIRONMENTAL IN CALIFORNIA Bridgeport Continuing Education Contact: 818-505-1490 April 8, 2003 SILICA LITIGATION CONFERENCE Mealey Publications The Ritz-Carlton Hotel Boston Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com April 10-11, 2003 HANDLING CONSTRUCTION RISKS 2003: ALLOCATE NOW OR LITIGATE LATER Practising Law Institute PLI New York Center Contact: 800-260-4PLI; info@pli.edu. April 15, 2003 WALL STREET FORUM: ASBESTOS Mealey Publications The Ritz-Carlton Hotel Battery Park Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com April 28-29, 2003 EPHEDRA LITIGATION CONFERENCE Mealey Publications The Ritz-Carlton Huntington Hotel & Spa, Pasadena, CA Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com April 28-29, 2003 BAD FAITH AND PUNITIVE DAMAGES Hotel Nikko, San Francisco Contact: 1-888-224-2480; http://www.americanconference.com May 1, 2003 TOXIC TORT IN CALIFORNIA Bridgeport Continuing Education Los Angeles Contact: 818-505-1490 May 1-2, 2003 ASBESTOS LITIGATION 2003 Andrews Publication New Orleans Grande Hotel, New Orleans Contact: seminar@andrewspub.com May 5-6, 2003 THE CURRENT STATE OF MEDICAL MALPRACTICE IN PA & NJ Mealey Publications The Ritz-Carlton Hotel, Philadelphia Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com May 7-8, 2003 MANAGING MOLD LIABILITIES Bridgeport Continuing Education San Francisco Contact: 818-505-1490 May 14-15, 2003 CALIFORNIA ENVIRONMENTAL UPDATE Bridgeport Continuing Education San Jose Contact: 818-505-1490 June 2-3, 2003 BAYCOL LITIGATION CONFERENCE Mealey Publications The Ritz-Carlton Hotel Amelia Island, FL Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com June 2-3, 2003 ASBESTOS BANKRUPTCY CONFERENCE Mealey Publications The Westin Hotel Philadelphia Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com June 9, 2003 ANTI-SLAPP STATUTE CONFERENCE Mealey Publications The Ritz-Carlton Huntington Hotel & Spa Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com June 12-13, 2003 CCA-TREA-TED WOOD LITIGATION CONFERENCE Mealey Publications The Ritz-Carlton Hotel Amelia Island, FL Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com June 12-13, 2003 ENVIRONMENTAL INSURANCE: PAST, PRESENT AND FUTURE American Law Institute Boston Contact: 215-243-1614; 800-CLE-NEWS x1614 June 16-17, 2003 LITIGATING EMPLOYMENT DISCRIMINATION & SEXUAL HARASSMENT CLAIMS Practising Law Institute PLI New York Center Contact: 800-260-4PLI; info@pli.edu. June 16-17, 2003 ASBESTOS LITIGATION 101 CONFERENCE Mealey Publications The Fairmont Hotel, Dallas Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com June 26-27, 2003 THE CLASS ACTION LITIGATION SUMMIT Northstar Conferences The Westin Embassy Row, Washington, DC Contact: 866-265-1975; 212-596-6006; cservice@northstarconferences.com August 1, 2003 CLASS ACTION LITIGATION 2003: PROSECUTION AND DEFENSE STRATEGIES Practising Law Institute PLI New York Center Contact: 800-260-4PLI; info@pli.edu. September 8-9, 2003 CORPORATE GOVERNANCE: LIABILITY OF CORPORATE OFFICERS AND DIRECTORS Mealey Publications The Ritz-Carlton Hotel Amelia Island, FL Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com September 19-21, 2003 THE 20TH TOBACCO PRODUCTS LIABILITY PROJECT CONFERENCE Northeastern University School of Law Contact: scuri@tplp.org November 13-14, 2003 ASBESTOS LITIGATION IN THE 21ST CENTURY ALI-ABA New Orleans Contact: 215-243-1614; 800-CLE-NEWS x1614 TBA Water Contamination Litigation Conference Mealey Publications Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com TBA Fair Labor Standards Conference Mealey Publications Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com * Online Teleconferences ------------------------ March 06-31, 2003 ETHICAL CONSIDERATIONS IN MASS TORT AND CLASS ACTION LITIGATION IN TEXAS CLE Online Seminar Contact: 512-778-5665; info@cleonline.com March 06-31, 2003 NBI PRESENTS "LITIGATING THE CLASS ACTION LAWSUIT IN FLORIDA CLE Online Seminar Contact: 512-778-5665; info@cleonline.com April 2, 2003 TOXIC MOLD: WHAT REAL ESTATE PRACTITIONERS NEED TO KNOW NOW Practising Law Institute PLI New York Center Contact: 800-260-4PLI; info@pli.edu. April 15, 2003 LITIGATING POSTTRAUMATIC STRESS DISORDER ABA-CLE Contact: 800-285-2221; abacle@abanet.org May 14, 2003 CLASS ACTION BASICS ABA-CLE Contact: 800-285-2221; abacle@abanet.org EXPERT WITNESS ADMISSIBILITY IN MOLD CASES LawCommerce.Com/Mealey's Online Streaming Video Contact: customerservice@lawcommerce.com INTRODUCTION TO CLASS ACTIONS AND LARGE RECOVERIES Big Class Action Contact: seminars@bigclassaction.com NON-TRADITIONAL DEFENDANTS IN ASBESTOR LITIGATION Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com PAXIL LITIGATION Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com RECENT DEVELOPMENTS INVOLVING BAYCOL Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com RECOVERIES Big Class Action Contact: seminars@bigclassaction.com SELECTION OF MOLD LITIGATION EXPERTS: WHO YOU NEED ON YOUR TEAM Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com SHOULD I FILE A CLASS ACTION? LawCommerce.Com / Law Education Institute Contact: customerservice@lawcommerce.com THE EFFECTS OF ASBESTOS ON THE PULMONARY SYSTEM Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com THE STATE OF ASBESTOS LITIGATION: JUDICIAL PANEL DISCUSSION Online Streaming Video LawCommerce.Com/Mealey's Contact: customerservice@lawcommerce.com TRYING AN ASBESTOS CASE LawCommerce.Com Contact: customerservice@lawcommerce.com ______________________________________________________________________ The Meetings, Conferences and Seminars column appears in the Class Action Reporter each Wednesday. Submissions via e-mail to carconf@beard.com are encouraged. New Securities Fraud Cases ADC TELECOMMUNICATIONS: Cauley Geller Commences Securities Suit in MN --------------------------------------------------------------------- Cauley Geller Bowman Coates & Rudman, LLP initiated a securities class action in the United States District Court for the District of Minnesota on behalf of purchasers of ADC Telecommunications Inc. (Nasdaq: ADCT) publicly traded securities during the period between November 2, 2000, and March 28, 2001, inclusive. The complaint charges that on November 2, 2000, ADC announced in a press release that the Company would meet or exceed published fiscal expectations, and that despite the expected overall decrease in telecom spending, shifts in Internet carrier spending would continue to benefit the Company especially in broadband access and optical components. The Company echoed these bullish predictions throughout the class period. ADC's true financial performance and business prospects were revealed at the end of the class period in a March 28, 2001 press release. In the press release, the defendants acknowledged that the Company was in fact performing below the projections issued earlier in the class period and as a result, the Company lowered its fiscal 2001 earnings guidance. For more details, contact Samuel H. Rudman, David A. Rosenfeld, Jackie Addison, Heather Gann or Sue Null by Mail: P.O. Box 25438, Little Rock, AR 72221-5438 by Phone: 1-888-551-9944 by E-mail: info@cauleygeller.com or visit the firm's Website: http://www.cauleygeller.com ADC TELECOMMUNICATIONS: Schiffrin & Barroway Lodges MN Securities Suit ---------------------------------------------------------------------- Schiffrin & Barroway, LLP initiated a securities class action in the United States District Court for the District of Minnesota on behalf of all purchasers of the common stock of ADC Telecommunications Inc., (Nasdaq:ADCT), from November 2, 2000 through March 28, 2001, inclusive. The complaint charges that on November 2, 2000, ADC announced in a press release that the Company would meet or exceed published fiscal expectations, and that despite the expected overall decrease in telecom spending, shifts in Internet carrier spending would continue to benefit the Company especially in broadband access and optical components. The Company echoed these bullish predictions throughout the class period. ADC's true financial performance and business prospects were revealed at the end of the class period in a March 28, 2001 press release. In the press release, the defendants acknowledged that the Company was in fact performing below the projections issued earlier in the class period and as a result, the Company lowered its fiscal 2001 earnings guidance. For more information, visit the firm's Website: http://www.sbclasslaw.com/cgi/signup.cgi ADC TELECOMMUNICATIONS: Glancy & Binkow Lodges Securities Lawsuit in MN ----------------------------------------------------------------------- Glancy & Binkow LLP initiated a securities class action in the United States District Court for the District of Minnesota on behalf of all persons who purchased securities of ADC Telecommunications, Inc. (Nasdaq: ADCT) between November 28, 2000 and March 28, 2001, inclusive. The suit charges ADC and certain of its officers with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and the dissemination of materially false and misleading statements concerning ADC's financial prospects caused ADC's stock price to become artificially inflated, inflicting damages on investors. ADC is a supplier of broadband-network equipment, software and services that enable communications service providers to deliver high-speed Internet, data, and voice services across the so-called "last mile" connecting providers' offices to end- users homes and businesses. The suit alleges that during the class period, defendants repeatedly represented that ADC would continue to achieve significant growth and would not be affected by widely known reductions in capital spending on the telecommunications infrastructure by communications service providers. Plaintiff claims that ADC's true financial performance and business prospects were revealed on March 28, 2001, when defendants acknowledged that the Company would lower its fiscal 2001 earnings guidance which defendants had issued only four weeks earlier, cut as many as 4,000 jobs and close facilities in the face of canceled orders and declining revenues caused by the reductions in spending on equipment by telecommunications service providers. For more details, contact Michael Goldberg by Mail: 1801 Avenue of the Stars, Suite 311, Los Angeles, California 90067, by Phone: (310) 201- 9161 or (888) 773-9224 or by E-mail: info@glancylaw.com. ALLOY INC.: Schiffrin & Barroway Lodges Securities Lawsuit in S.D. NY --------------------------------------------------------------------- Schiffrin & Barroway, LLP initiated a securities class action in the United States District Court for the Southern District of New York on behalf of all purchasers of the common stock of Alloy Inc. (Nasdaq:ALOY), from August 1, 2002 through January 23, 2003, inclusive. The complaint charges that the Company, Matthew C. Diamond (CEO), James K. Johnson Jr. (President and COO) and Samuel A. Gradess (CFO) 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 materially false and misleading statements to the market between August 1, 2002 and January 23, 2003. Alloy is a teen-focused media company and direct marketer that targets Generation Y consumers, i.e. the approximately 60 million people in the United States between the ages of 10 and 24. The complaint alleges that the Company claimed that its merchandising and advertising segments complemented one another in a way that gave the Company an edge over competitor teen retailers and media businesses and which would enable it to succeed despite difficult market conditions in the second half of 2002. Unbeknownst to investors, the Company faced fierce competition for the youth market and the weak economy forced the Company to cut its prices and increase operating expenses, e.g. by offering free shipping and deep discounts, thereby eroding Alloy's gross profit margin. On January 23, 2003, the Company shocked the market by announcing that EBTA for its fiscal fourth quarter ending January 31, 2003 would be $11 million to $12 million instead of the previously projected $15 million to $16 million and that fiscal 2002 EBTA would be in the range of $30 to $31 million instead of the previously forecast $34 million to $38 million. On this news, the Company's share priced plummeted by 49%, or $4.57, from the previous day's closing price of $9.10. For more details, contact Marc A. Topaz or Stuart L. Berman by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1-888-299-7706 (toll free) or 1-610-667-7706 or by E-mail: info@sbclasslaw.com ASTROPOWER INC.: Schiffrin & Barroway Files Securities Suit in DE Court ----------------------------------------------------------------------- Schiffrin & Barroway, LLP initiated a securities class action in the United States District Court for the District of Delaware on behalf of all purchasers of the common stock of AstroPower Inc. (Nasdaq:APWR) from February 22, 2002 through August 1, 2002, inclusive. The complaint charges that the Company, Allen M. Barnett (CEO and President) and Thomas J. Stiner (CFO) 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 materially false and misleading statements to the market between February 22, 2002 and August 1, 2002. The complaint alleges that AstroPower develops, manufactures, markets and sells a range of solar electric power generation products. The complaint further alleges that the company claimed that it was well positioned to take advantage of the increasing demand for solar power products. The complaint further alleges that, throughout the class period, the Company reported strong revenue and earnings growth and that, as a result of these statements and reports, which were disseminated to the investing public, and which formed the basis for research analysts' reports on the Company, the Company's per share stock price reached a class period high of $27 on March 28, 2002. In truth and in fact, throughout the class period, the Company was unable to effectively manage its expanding and increasingly complex operations; it was, inter alia, unable to allocate resources among its various manufacturing facilities to effectively meet regional demand or to tailor its production capacity to actual demand. Consequently, during the time that the Company was stating that it was well positioned to take advantage of the increased demand for solar products, it was in fact losing ground to more effective competitors. Additionally, to maintain the illusion that its operations were successful, the Company throughout the class period reported artificially inflated revenue and earnings by, inter alia, recording revenue in advance of shipment, contrary to its stated principles of revenue recognition. The truth was revealed on August 1, 2002 when, after the close of trading, the Company announced its results for the second quarter ended June 30, 2002. Analysts were stunned. Reported revenue and net income had not grown but, on the contrary, second quarter income was $365,000, or $0.02 per diluted share compared to $1.7 million, or $0.07 per diluted share in the year-earlier second quarter and revenue of $20.4 million represented only a one percent increase over reported revenue for the prior quarter and was approximately $4.9 million below analysts' consensus estimate. On this news, AstroPower's share price plunged 48%, or $7.12, to $7.77, its lowest price in almost three years. For more details, contact Marc A. Topaz or Stuart L. Berman by Mail: Three Bala Plaza East, Suite 400, Bala Cynwyd, PA 19004 by Phone: 1-888-299-7706 (toll free) or 1-610-667-7706 by E-mail: info@sbclasslaw.com or visit the firm's Website: http://www.sbclasslaw.com LIPPER CONVERTIBLES: Cohn Lifland, Kucker & Bruh File Securities Suit --------------------------------------------------------------------- Cohn Lifland Pearlman Herrmann & Knopf LLP and Kucker & Bruh, LLP initiated a securities class action on behalf of purchasers of limited partnership interests in Lipper Convertibles, LP. The action has been instituted on behalf of two putative classes, one consisting of all limited partners who invested in the partnership between January 13, 1998 and March 26, 2002 (10b5 Class) and the second consisting of those limited partners who invested in the partnership between February 20, 1999 and March 26, 2002 pursuant to a prospectus (12(2) Class). The suit names as defendants: (1) Lipper Holdings, LLC, the general partner of the Partnership; (2) Kenneth Lipper, Chairman, Chief Executive Officer and President of Lipper Holdings, who was responsible for supervising the day-to-day operations of the Partnership; (3) Abraham Biderman, the Executive Vice President of Lipper Holdings and the Co-Manager of the Partnership, who was responsible for managing the day-to-day operations of the Partnership; and (4) Edward Strafaci, the Co-Manager of the Partnership, who was responsible for managing the day-to-day operations of the Partnership The complaint alleges that the defendants artificially inflated the value of the Partnership's assets, profits and performance by utilizing inaccurate, unjustifiable and baseless pricing policies and valuation practices, which violated, among other things, representations made in the offering documents as well as generally accepted accounting principles. The complaint alleges, and a report prepared by special counsel retained by the Partnership confirms, that the valuations were not supported by any rational basis. The complaint alleges that the defendants violated Sections 10(b) and 20(a) of the Securities and Exchange Act of 1934 and SEC Rule 10b5 promulgated thereunder by misrepresenting the financial condition, profitability, performance and value of the Partnership's assets and the risk of investing in the Partnership, among other things, and Section 12(2) of the Securities Act of 1933 by directly and indirectly offering for sale and selling securities in the form of the limited partnership interests by means of prospectus, which included untrue material statements and omissions as to the profits, performance and value of the Partnership assets, and the risk of investing in the Partnership, among other things. It alleges that the plaintiff and all of the members of the classes were induced to purchase the limited partnership interests by the misrepresentations and/or were ignorant of the omissions and that as a result, they made the purchases at inflated prices and suffered losses which they otherwise would not have suffered. For more details, contact Peter S. Pearlman, of Cohn Lifland Pearlman Herrmann & Knopf LLP by Mail: Park 80 Plaza West One, Saddle Brook, New Jersey 07663 or by E-mail: psp@njlawfirm.com or contact Jeffrey W. Herrmann by Mail: Park 80 Plaza West One, Saddle Brook, New Jersey 07663 or by E-mail: jwh@njlawfirm.com. PARAMETRIC TECHNOLOGIES: Marc Henzel Commences Securities Lawsuit in MA ----------------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Massachusetts, on behalf of all purchasers of the common stock of Parametric Technology Corporation (NASDAQ: PMTC) from October 19, 1999, through December 31, 2002, inclusive. The complaint charges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between October 19, 1999 and December 31, 2002, thereby artificially inflating the price of Parametric common stock. Throughout the class period, as alleged in the suit, defendants issued numerous statements and filed quarterly and annual reports with the SEC, which described the Company's increasing revenues and financial performance. The suit alleges that these statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (1) that since fiscal 1999, in violation of Generally Accepted Accounting Principles (GAAP) and its own revenue recognition policies, the Company had cumulatively overstated its previously recognized maintenance revenue from its service contracts by approximately $33.4 million; (2) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (3) that as a result, the value of the Company's income and financial results were materially overstated at all relevant times. On December 31, 2002, after the close of regular trading, Parametric shocked the market by announcing that it had identified "$20 to $25 million of previously recognized maintenance revenue which should have been deferred and recognized in fiscal 2003 and later periods." Accordingly, the Company announced, it "expects to report a corresponding reduction in maintenance revenue in prior periods, primarily in fiscal year 2002." The next day of trading, on January 2, 2003, shares of Parametric closed at $2.19 per share, after hitting an intraday low of $1.95, as compared with a class period high of $32.88 per share, reached on December 16, 1999. Subsequent disclosures revealed that the Company would be restating its financial results from fiscal year 1999 through fiscal year 2002 because a cumulative total of $33.4 million in maintenance revenue had improperly been reported as revenue during that time. For more details, contact Marc S. Henzel by Mail: The Law Offices of Marc S. Henzel, 273 Montgomery Ave, Suite 202 Bala Cynwyd, PA 19004- 2808 by Phone: (888) 643-6735 or (610) 660-8000, by Fax: (610) 660-8080, by E-mail: Mhenzel182@aol.com or visit the firm's Website: http://members.aol.com/mhenzel182. PARAMETRIC TECHNOLOGIES: Stull Stull Commences Securities Lawsuit in MA ----------------------------------------------------------------------- Stull Stull & Brody LLP initiated a securities class action in the United States District Court for the District of Massachusetts, on behalf of purchasers of Parametric Technology Corporation (NASDAQ: PMTC) securities between October 19, 1999 and December 31, 2002, inclusive against the Company and: (1) Steven C. Walske (CEO until March 1, 2000 and Chairman until June 2000), (2) Noel G. Posternak (Chairman since June 2000), (3) C. Richard Harrison (CEO since March 1, 2000, President since 1994) and (4) Edwin J. Gillis (Executive Vice President, CFO and Treasurer from January 15, 2002 to November 12, 2002) The complaint charges 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 materially false and misleading statements to the market during the class period. The complaint alleges that, throughout the class period, Parametric issued numerous statements and filed quarterly and annual reports with the SEC which described the Company's supposedly increasing revenues and financial performance. These statements were materially false and misleading when made, the complaint alleges, because the Company had overstated its revenue since fiscal 1999, in violation of generally accepted accounting principles and because the Company lacked adequate internal controls and was unable to accurately determine and report the Company's financial condition. On December 31, 2002, after the close of regular trading, Parametric issued a press release announcing a "$20 to $25 million of previously recognized maintenance revenue which should have been deferred and recognized in fiscal 2003 and later periods." Accordingly, the Company announced, it "expects to report a corresponding reduction in maintenance revenue in prior periods, primarily in fiscal year 2002." In reaction, on January 2, 2003, shares of Parametric closed at $2.19 per share, after hitting an intraday low of $1.95, as compared with a class period high of $32.88 per share, reached on December 16, 1999. For more details, contact Tzivia Brody by Mail: 6 East 45th Street, New York NY 10017 by Phone: 1-800-337-4983, by Fax: 212-490-2022 or by E- mail: SSBNY@aol.com or visit the firm's Website: http://www.ssbny.com. PARAMETRIC TECHNOLOGIES: Chitwood & Harley Lodges Securities Suit in MA ----------------------------------------------------------------------- Chitwood & Harley initiated a securities class action in the United States District Court for the District of Massachusetts, on behalf of purchasers of securities of Parametric Technology Corporation, (Nasdaq:PMTC) between October 19, 1999 and December 31, 2002. The suit is brought against the Company and certain of its officers and directors. The complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market during the class period thereby artificially inflating the price of Parametric securities. The complaint alleges that, throughout the class period, Defendants' statements and quarterly and annual reports filed with the SEC which described the Company's increasing revenues and financial performance were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (1) that since fiscal 1999, in violation of Generally Accepted Accounting Principles and its own revenue recognition policies, the Company had cumulatively overstated its previously recognized maintenance revenue from its service contracts by approximately $33.4 million; (2) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (3) that as a result, the value of the Company's income and financial results were materially overstated at all relevant times. On December 31, 2002, Parametric shocked the market by announcing that it had identified "$20 to $25 million of previously recognized maintenance revenue which should have been deferred and recognized in fiscal 2003 and later periods." Consequently, the Company announced it "expects to report a corresponding reduction in maintenance revenue in prior periods, primarily in fiscal year 2002." Subsequent disclosures revealed that the Company would be restating its financial results from fiscal year 1999 through fiscal year 2002 because a cumulative total of $33.4 million in maintenance revenue had improperly been reported as revenue during that time. For more details, contact Jennifer Morris by Mail: 1230 Peachtree Street, Suite 2300, Atlanta Georgia 30309 by Phone: 1-888-873-3999 by E-mail: jlm@classlaw.com or visit the firm's Website: http://www.classlaw.com ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Trenton, New Jersey, and Beard Group, Inc., Washington, D.C. Enid Sterling, Aurora Fatima Antonio and Lyndsey Resnick, Editors. Copyright 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. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *