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/raid1/www/Hosts/bankrupt/CAR_Public/030326.mbx C L A S S A C T I O N R E P O R T E R Wednesday, March 26, 2003, Vol. 5, No. 60 Headlines 3COM CORPORATION: Former Employees Commence Suit Over Wages in Toronto COMCAST CORPORATION: Asks For Dismissal of Securities Suits in CA, NY CROMPTON CORPORATION: Faces Twenty Antitrust Rubber Chemical Lawsuits DQE INC.: Expert Discovery in Consolidated Suit To Start September 2003 KING PHARMACEUTICALS: Investors File Six Lawsuits On Heels Of SEC Probe NEW FOCUS: NY Court Refuses To Dismiss Consolidated Securities Lawsuit NEW FOCUS: Faces Suit for Securities Fraud, State Law Violations in FL NORTHWEST AIRLINES: Plaintiffs Appeal Dismissal of MN Antitrust Lawsuit NORTHWEST AIRLINES: Trial in Travel Agents Suit To Commence April 2003 NORTHWEST AIRLINES: Plaintiffs Ask TN Court To Certify Consumer Suits PHILIP MORRIS: Illinois Court Issues Landmark $10B 'Light Lie' Ruling PRE-PAID LEGAL: Plaintiffs Appeal Denial of Motion For Reconsideration PRE-PAID LEGAL: OK Court To Hear Certification For Salespersons Lawsuit QUICKLOGIC CORPORATION: NY Court Refuses To Dismiss Consolidated Suit SYNOVUS FINANCIAL: Agrees To Settle AL Insurance Commissions Lawsuit TEMPLE INLAND: Trial in Linerboard Firms Suit Set For April 2004 in PA TUMBLEWEED COMMUNICATIONS: Shareholders File Securities Suit in S.D. NY TUMBLEWEED COMMUNICATIONS: Asks MI Court To Dismiss Securities Lawsuit TYSON FOODS: Manager Testifies Firm Officials Knew About Illegal Hiring VEHICLE RECALLS: NHTSA Announces Several Passenger Vehicle Recalls ZIFF-DAVIS INC.: Court Refuses To Dismiss Employees' Stock Fraud Suit ZIFF-DAVIS INC.: NY Court Dismisses in Part Securities Fraud Lawsuits Meetings, Conferences & Seminars * Scheduled Events for Class Action Professionals * Online Teleconferences New Securities Fraud Cases ANDRX CORPORATION: Johnson & Perkinson Files Securities Suit in S.D. FL BAYER AG: Milberg Weiss Commences Securities Fraud Lawsuit in S.D. NY BLACK BOX: Cauley Geller Commences Securities Fraud Lawsuit in W.D. PA COLLINS & AIKMAN: Milberg Weiss Launches Securities Lawsuit in E.D. MI HEALTHSOUTH CORPORATION: Schiffrin & Barroway Files Lawsuit in N.D. AL MICROTUNE INC: Marc Henzel Commences Securities Fraud Suit in E.D. TX MICROTUNE INC: Wolf Haldenstein Files Securities Fraud Suit in E.D. TX PARAMETRIC TECHNOLOGY: Goodkind Labaton Files Securities Lawsuit in MA ********* 3COM CORPORATION: Former Employees Commence Suit Over Wages in Toronto ---------------------------------------------------------------------- 3COM Corporation faces a class action filed in Toronto in the Ontario Superior Court of Justice by a former employee. The statement of claim alleges breach of contract arising out of 3COM's alleged failure to make payment of bonuses allegedly owing to its former employees. The plaintiff will be requesting court certification of a class that includes all persons who were: (1) formerly employed by LANSource Technologies Inc. prior to December 17, 1999; and (2) former employees of 3COM and whose employment was terminated by 3COM at any time on or after December 17, 1999 The plaintiff is bringing this action under the Class Proceedings Act, 1992. The claim, which has yet to be proven in court, states that the defendant has not paid all of the promised amounts owing under the written employment agreements with the employees. The plaintiff alleges that this constitutes a breach of his contract with the defendant. Kirk M. Baert of the Toronto law firm Koskie Minsky is representing the class. COMCAST CORPORATION: Asks For Dismissal of Securities Suits in CA, NY --------------------------------------------------------------------- Comcast Corporation has asked for the dismissal of litigation filed against it as a result of its alleged conduct with respect to its investment in and distribution relationship with At Home Corporation. At Home was a provider of high-speed Internet access and content services which filed for bankruptcy protection in September 2001. Pending actions are: (1) class actions against the Company, Brian L. Roberts (its President and Chief Executive Officer and a director), AT&T (the former controlling shareholder of At Home and also a former distributor of the At Home service) and other corporate and individual defendants in the Superior Court of San Mateo County, California, alleging breaches of fiduciary duty on the part of the Company and the other defendants in connection with transactions agreed to in March 2000 among At Home, the Company, AT&T and Cox Communications, Inc. (Cox is also an investor in At Home and a former distributor of the At Home service); (2) class actions against Comcast Cable Communications, Inc., AT&T and others in the United States District Court for the Southern District of New York, alleging securities law violations and common law fraud in connection with disclosures made by At Home in 2001; and (3) a lawsuit brought in the United States District Court for the District of Delaware in the name of At Home by certain At Home bondholders against the Company, Brian L. Roberts, Cox and others, alleging breaches of fiduciary duty relating to the March 2000 transactions and seeking recovery of alleged short- swing profits of at least $600 million pursuant to Section 16(b) of the Securities Exchange Act of 1934 purported to have arisen in connection with certain transactions relating to At Home stock effected pursuant to the March 2000 agreements. The actions in San Mateo County, California have been stayed by the United States Bankruptcy Court for the Northern District of California, the court in which At Home filed for bankruptcy, as violating the automatic bankruptcy stay. In the Southern District of New York actions, the court ordered the actions consolidated into a single action. An amended consolidated class action complaint was filed on November 8, 2002. All of the defendants served motions to dismiss on February 11, 2003. The Company denies any wrongdoing in connection with the claims made directly against it, its subsidiaries and Brian L. Roberts. In management's opinion, the final disposition of these claims is not expected to have a material adverse effect on its consolidated financial position, but could possibly be material to the Company's consolidated results of operations of any one period. Further, no assurance can be given that any adverse outcome would not be material to its consolidated financial position. CROMPTON CORPORATION: Faces Twenty Antitrust Rubber Chemical Lawsuits --------------------------------------------------------------------- Crompton Corporation and certain of its subsidiaries along with other companies, have been named as defendants in twenty putative indirect purchaser class actions filed during the period from October, 2002 through December, 2002 in state courts in seventeen states and in the District of Columbia. The putative class in each of the actions comprises all persons within each of the applicable states and the District of Columbia who purchased tires other than for resale that were manufactured using rubber processing chemicals sold by the defendants since 1994. The complaints principally allege that the defendants agreed to fix, raise, stabilize and maintain the price of rubber processing chemicals used as part of the tire manufacturing process in violation of state antitrust and consumer protection laws and that this illegal conspiracy caused injury to individuals who paid more to purchase tires as a result of such anticompetitive activities. The plaintiffs seek, among other things, treble damages of an unspecified amount, interest and attorneys' fees and costs. The Company and its defendant subsidiaries have filed or intend to file motions to dismiss on substantive and personal jurisdictional grounds or answers with respect to each of these actions. These actions are in early procedural stages of litigation and, accordingly, the Company cannot predict their outcome. The Company and its defendant subsidiaries believe that they have substantial defenses to these actions and intend to defend vigorously all such actions. DQE INC.: Expert Discovery in Consolidated Suit To Start September 2003 ----------------------------------------------------------------------- Pre-trial discovery in the consolidated securities class action pending against DQE Inc. is set to conclude on September 23,2003 in the United States District Court for the Western District of Pennsylvania. Expert discovery will commence thereafter. The suit names as defendants the Company, and its former chairman, chief executive officer and president David Marshall. The complaint alleges violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and Section 12(a)(2) of the Securities Act of 1933. The complaint alleges controlling person liability under Section 20(a) of the Exchange act and Section 15 of the Securities Act. The complaint alleges that between December 6, 2000, and April 30, 2001, the defendants issued a number of materially false and misleading statements concerning investments made by the Company's subsidiary, DQE Enterprises, and the impact that these investments would have on our current and future financial results. More particularly, the complaint alleges that the Company and Marshall stated their expectation that certain companies in which DQE Enterprises had invested would undertake initial public offerings of their shares, with the result that the Company's earnings would be positively impacted by the public market valuation of DQE Enterprises' interests in these companies, but failed to disclose allegedly adverse facts that made the possibility of successful public offerings of the securities of these companies unlikely. On December 12, 2002, the lead plaintiffs asked the court to certify the class action. The motion is scheduled for argument before the court on April 7, 2003. Since December 2002, the Company and the plaintiffs have been in pre-trial discovery. The court has directed that this phase be concluded by September 30, 2003, followed by an expert discovery period through December 31, 2003. No trial date has yet been scheduled, and the Company would not anticipate one to be set before the first quarter of 2004. Although the Company cannot predict the ultimate outcome of this case or estimate the range of any potential loss that may be incurred in the litigation, the Company believes that the lawsuit is without merit, strenuously denies all of the plaintiffs' allegations of wrongdoing and believes it has meritorious defenses to the plaintiffs' claims. KING PHARMACEUTICALS: Investors File Six Lawsuits On Heels Of SEC Probe ----------------------------------------------------------------------- Investors have filed six class actions against drug maker King Pharmaceuticals, following quickly upon an investigation by the Securities and Exchange Commission (SEC), the Associated Press Newswires reports. This kind of sequence is not unusual, since the SEC's gathering of evidence usually provides investors with a basis for their lawsuits. The lawsuits, filed recently in Greeneville, Tennessee, allege that King and some senior officers issued "materially false and misleading statements," concerning the company's operations and earnings that artificially inflated its stock. Each of the lawsuits was filed after the announcement that the SEC was investigating King's sales of some products to two firms, Vita Rx and Prison Health services, as well as the pricing of some of the products sold in 1999 and 2000. According to one lawsuit, King allegedly stated that the prices paid by Medicaid agencies were the best price; that is, the cheapest price, resulting in government overpayment for the drugs. The same complaint also claims King "misstated and/or omitted facts about revenue subject to "pharmaceutical rebate" payments provided by the company. SEC investigators are seeking the following: King's "best price" lists, all documents related to its pricing to any governmental Medicaid agency during 1999 and accrual and payment of rebates on the high-blood pressure drug Altace from 2000 to the present. Another lawsuit alleged that "while the stock was inflated, King Pharmaceuticals completed two secondary stock offerings, raising more than $900 million in proceeds." Former Chairman and CEO John M. Gregory, current President and CEO Jefferson Gregory and Chief Financial Officer James Lattanzi were named as individual defendants. NEW FOCUS: NY Court Refuses To Dismiss Consolidated Securities Lawsuit ---------------------------------------------------------------------- The United States District Court for the Southern District of New York refused to dismiss the consolidated securities class action pending against New Focus, Inc., and several of its officers and directors. The suit also names as defendants the underwriters of the Company's initial public offering: (1) Credit Suisse First Boston Corporation, (2) Chase Securities, Inc., (3) US Bancorp Piper Jaffray, Inc. and (4) CIBC World Markets Corporation The amended complaint alleges: (i) violations of Section 11 of the Securities Act of 1933 against all defendants related to the Initial Public Offering and the Secondary Offering, (ii) violations of Section 15 of the Securities Act of 1933 and Section 20(a) of the Securities Act of 1934 against the individual defendants, (iii) violations of Section 10(b) and Rule 10b-5 against the company and (iv) violations of Section 12(a)(2) of the Securities Act of 1933 and Section10(b), and Rule 10b-5 promulgated thereunder, of the Securities Act of 1934 against the underwriter defendants. The amended complaint seeks unspecified damages on behalf of a purported class the Company's common stock purchasers between May 18, 2000 and December 6, 2000. Various plaintiffs have filed similar actions in the same court asserting virtually identical allegations concerning the offerings of more than 300 other issuers. These cases have all been assigned to the Hon. Shira A. Scheindlin for coordination and decisions on pretrial motions, discovery, and related matters other than trial. In July 2002, defendants filed an omnibus motion to dismiss in the coordinated proceedings on common pleadings issues. In October 2002, the court entered as an order a stipulation dismissing the individual defendants from the litigation without prejudice. On February 19, 2003, the omnibus motion to dismiss was denied by the court as to the claims against the Company. NEW FOCUS: Faces Suit for Securities Fraud, State Law Violations in FL ---------------------------------------------------------------------- New Focus, Inc. faces a class action filed in the United States District Court for the Southern District of Florida against Credit Suisse First Boston Corporation, approximately 50 issuers, including the Company, and various individuals of the issuer defendants, including William L. Potts, Jr., its Chief Financial Officer. As against New Focus, the complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 as well as claims for common law fraud, negligent misrepresentation, and violations of the Florida Blue Sky Law arising out of the initial public offering of the Company's common stock. As against Mr. Potts, the complaint alleges violations of Sections 10(b) and 15 of the Securities Exchange Act of 1934 and Rule 10b-5 as well as claims for common law fraud, negligent misrepresentation, and violations of the Florida Blue Sky Law, also arising out of the initial public offering of our common stock. NORTHWEST AIRLINES: Plaintiffs Appeal Dismissal of MN Antitrust Lawsuit ----------------------------------------------------------------------- Plaintiffs in the antitrust class action against Northwest Airlines appealed the United States District Court for Minnesota's ruling dismissing the suit. Midwestern Machinery Co. and several individuals filed the suit in June 1997, alleging that the Company's acquisition of Republic Airlines in 1986 resulted in a substantial reduction in competition in violation of Section 7 of the Clayton Act. In February 2001, the court granted the plaintiff's motion for class certification. On February 5, 2003, the court entered an order granting the Company's motion for summary judgment and dismissing the case. The plaintiffs have appealed the order. The Company believes the lawsuit to be without merit. NORTHWEST AIRLINES: Trial in Travel Agents Suit To Commence April 2003 --------------------------------------------------------------------- Trial in the class action against Northwest Airlines is set to commence in April 2003 in the United States District Court for the District of North Carolina. A North Carolina travel agent filed the suit in October 1999, initially in State Court in North Carolina, on behalf of herself and similarly situated North Carolina travel agents, challenging actions by most major airlines, including the Company, to reduce travel agent base commissions from 8 percent to 5 percent and alleging several state law theories of liability, including conspiracy. In June 2000, the plaintiff filed a voluntary dismissal and then filed a new case in federal court. The new case was deemed a class action, now on behalf of a nation-wide class of travel agents, and alleges an unlawful agreement among airlines to reduce commissions in violation of the Sherman Act, and is based on the same factual allegations. In November 2001, the court granted the plaintiff's motion to amend the complaint to include allegations that other commission reductions in 1997 and 1998 were the result of unlawful agreements among the airline defendants in violation of the Sherman Act. The complaint was subsequently amended again to allege that commission reductions in March 2002 were also the result of an unlawful agreement among the airline defendants. The court later entered an order granting plaintiffs' motion for class certification. Defendants' motion for summary judgment is pending. The Company believes the case to be without merit. NORTHWEST AIRLINES: Plaintiffs Ask TN Court To Certify Consumer Suits --------------------------------------------------------------------- Northwest Airlines faces two class actions filed in the United States District Court for the Western District of Tennessee, alleging alleging violations of Section 2 of the Sherman Act. The suits allege that the Company has monopolized or attempted to monopolize air transportation on certain routes into and out of its three domestic hubs through a variety of exclusionary practices. The plaintiff purports to sue on behalf of all similarly situated passengers who purchased tickets on Northwest for travel on certain routes into or out of its three hubs since at least as early as April 1995. The Company believes these cases to be without merit. The plaintiffs' motion for class certification is pending. PHILIP MORRIS: Illinois Court Issues Landmark $10B 'Light Lie' Ruling --------------------------------------------------------------------- Friday's landmark $10 billion Illinois Circuit Court verdict against Philip Morris in the nation's first class action consumer fraud lawsuit on light cigarettes has medical and legal implications that will follow Philip Morris to courthouses all over the country, plaintiffs' attorneys said. For the first time, a court issued a finding of fact that light cigarettes are actually more dangerous than regular cigarettes. In finding for the plaintiffs in Miles v. Philip Morris, Judge Nicholas Byron issued findings of fact that attest to the fraud and set a ground-breaking legal precedent, according to attorneys in the case. "The significance of this ruling goes far beyond Illinois. In all future cases nationwide, Philip Morris will have to overcome the judgment that its use of the word 'light' was fraudulent," said Stephen Tillery, lead plaintiffs' attorney in the case. "Consumers of light cigarettes have been lied to for years, and they've been paying with their lives. The compensatory damages pale beside the price paid in human lives." "The evidence at trial demonstrates not only that Marlboro Lights and Cambridge Lights are just as harmful as their regular counterparts, but that these products are actually more harmful and more hazardous than their regular counterparts," Judge Byron concluded in his order. "Philip Morris' own internal research regarding compensatory smoking behavior demonstrates that Philip Morris knew since before the launch of Marlboro Lights and Cambridge Lights that smokers will adjust their behavior to receive the same level of tar and nicotine from these Light cigarettes as they would receive from their regular cigarette counterparts," the judge said. "The Court finds that Philip Morris was aware of the increased harm from these Light cigarettes based upon their own scientific testing." "It is therefore quite significant that their test results have consistently demonstrated for the past 25 years that increased ventilation (the primary design distinction between Light cigarettes and their regular counterparts) increases the specific mutagenicity of cigarette smoke ... The fact that Philip Morris intentionally prevented its scientists in the United States from performing additional testing does not undermine the credibility and reliability of the testing that Philip Morris did perform. In fact, this intentional failure to conduct additional testing further demonstrates Philip Morris' belief that light cigarettes were and are more harmful than their regular counterparts," the order stated. "Philip Morris' contention that the public health community should somehow be blamed for the fraud associated with Light cigarettes is both morally abhorrent and factually incorrect. At all times since the inception of their Lights products, Philip Morris was aware of their deception and was aware that the public health community was among those deceived by the fact that their products did not deliver the promised lower tar and nicotine and were not "light" as represented. Yet it was not until the fall of 2002 that they disseminated this knowledge. As such, they cannot assert that the Class should have known information which they chose not to publicly reveal until November 2002," Judge Byron said. Public health experts and a leading consumer protection group praised the decision. "The ruling sends a strong message that Big Tobacco's conduct is incompatible with responsible, ethical business practice. The industry must accept responsibility for causing decades of illness, premature mortality, and high medical care costs," said Tom Houston, M.D., Director Science and Community Health Advocacy, American Medical Association. "Many smokers switched to these brands in a false belief they were reducing their health risk. This ruling holds Philip Morris accountable for their irresponsible, harmful conduct," said Matthew L. Myers, president, Campaign for Tobacco-Free Kids. The Judge said that testimony by Philip Morris experts that just because there is no "real" light cigarette does not reduce the harm done to consumers. "Philip Morris never offered a "real" Marlboro Light or Cambridge Light cigarette to the Class. Philip Morris cannot escape liability in this case from its fraud because of the fact that it never created the product that it promised in Marlboro Lights and Cambridge Lights," he concluded. At a minimum, light cigarette consumers get the same amount of tar and nicotine as they would smoking regular cigarettes and further, the tar of light cigarettes contains more toxins. According to evidence presented in the case: (1) Philip Morris designed their Marlboro Lights and Cambridge Lights cigarettes with more ventilation holes that would reduce the machine-measured tar and nicotine delivery (in order to "pass" a lower tar/nicotine test designed by the FTC), all the while knowing that actual smokers would extract even greater levels of tar and nicotine for two reasons: First, unlike a machine, a human hand may block a cigarette's ventilation which changes the chemical reaction of the smoke to make it burn more hotly and with more deadly chemical composition; and second, smokers engage in a process of compensation due to their nicotine addiction, causing them to inhale more deeply, hold smoke longer and puff more frequently to satisfy that addiction. (2) According to the Massachusetts Benchmark study by Philip Morris published in 2000, studies of 25 identified toxic carcinogens in the tar of both Marlboro Lights and Marlboro Reds revealed that the Marlboro Lights contained higher amounts of 22 of these mutagens. "In terms of dangerous chemicals, light cigarettes deliver two bangs for the butt. Not only do smokers of light cigarettes inhale just as much tar, the tar in these so-called light cigarettes contains even more mutagens. Put simply, light cigarettes deliver just as much tar, more toxins, and are even more deadly. What is incredible and even more appalling, Philip Morris' own testing revealed this truth as early the mid-1970s, yet the company deceived the public for decades, " said Peter Shields, M.D., chief of the Cancer Genetics and Epidemiology Department at Georgetown's Lombardi Cancer Center. "Plaintiffs introduced credible scientific and epidemiological evidence that connected the dramatic increase in adenocarcinomas (lung cancer of the peripheral lung cells) to the increased prevalence of light cigarettes like Marlboro Lights and Cambridge Lights. The unrebutted expert testimony of Dr. Peter Shields and Dr. Michael Thun established that Marlboro Lights and Cambridge Lights have contributed to the dramatic rise in adenocarcinoma cancer rates, thereby demonstrating another line of evidence that establishes increased harm from the 'Light' cigarette products," the Judge said in his order. "I chose Marlboro Lights because I thought they would be less harmful. At least people will know the truth now and will be able to make informed decisions, and Philip Morris won't be able to get away with deceiving people anymore," said Lisa Kezios, a plaintiff in the suit. Both Canada and the European Union have recently banned cigarettes marketed as "light" cigarettes. PRE-PAID LEGAL: Plaintiffs Appeal Denial of Motion For Reconsideration ---------------------------------------------------------------------- Plaintiffs in the securities class action filed against Pre-paid Legal Services, Inc. appealed the denial of their motion for reconsideration of the dismissal of the suit. The suit was originally filed in the United States District Court for the Western District of Oklahoma against the Company and certain of its executive officers. The suit seeks unspecified damages on the basis of allegations that the Company issued false and misleading financial information, primarily related to the method the Company used to account for commission advance receivables from sales associates. On March 5, 2002, the court granted the Company's motion to dismiss the complaint, with prejudice, and entered a judgment in favor of the defendants. Plaintiffs thereafter filed a motion requesting reconsideration of the dismissal, which was denied. The plaintiffs have appealed the judgment and the order denying their motion to reconsider the judgment to the Tenth Circuit Court of Appeals. As of February 28, 2003, the case was in the briefing stage. The Company is unable to predict when a decision will be made on this appeal. In August 2002, the lead institutional plaintiff withdrew from the case, leaving two individual plaintiffs as lead plaintiffs on behalf of the putative class. PRE-PAID LEGAL: OK Court To Hear Certification For Salespersons Lawsuit ----------------------------------------------------------------------- The District Court of Canadian County, Oklahoma will hear on July 22, 2003 motions for class certification of a lawsuit filed against Pre- Paid Legal Services, Inc. on behalf of all Company sales associates. The amended petition seeks injunctive and declaratory relief, and other damages as the court deems appropriate, for alleged violations of the Oklahoma Uniform Consumer Credit Code in connection with the Company's commission advances, and seeks injunctive and declaratory relief regarding the enforcement of certain contract provisions with sales associates. The impact of the claims alleged under the Consumer Credit Code and the assertion of entitlement to injunctive relief could exceed $315 million if plaintiffs are successful both in their request for class certification and on the merits. QUICKLOGIC CORPORATION: NY Court Refuses To Dismiss Consolidated Suit --------------------------------------------------------------------- The United States District Court for the Southern District of New York refused to dismiss the consolidated securities class action filed against Quicklogic Corporation, some of its officers and directors and some investment banks that underwrote the Company's initial public offering. The complaint alleges excessive and undisclosed commissions in connection with the allocation of shares of common stock in the Company's initial public offering and artificially high prices through "tie-in" arrangements which required the underwriters' customers to buy shares in the aftermarket at pre-determined prices in violation of the federal securities laws. Plaintiffs seek an unspecified amount of damages on behalf of persons who purchased the Company's stock pursuant to the registration statements between October 14, 1999 and December 6, 2000. Various plaintiffs have filed similar actions asserting virtually identical allegations against over 300 other public companies, their underwriters, and their officers and directors arising out of each company's public offering. All actions have been coordinated for pretrial purposes and captioned In re Initial Public Offering Securities Litigation, 21 MC 92. Defendants in these cases have filed omnibus motions to dismiss on common pleading issues. In October 2002, the Company's officers and directors were voluntarily dismissed without prejudice. Oral argument on the omnibus motion to dismiss was held on November 1, 2002. On February 19, 2003, the court denied in part and granted in part the motion to dismiss filed on behalf of defendants, including the Company. The court's order did not dismiss any claims against the Company. As a result, discovery may now proceed. The Company believes that the allegations against it are without merit. SYNOVUS FINANCIAL: Agrees To Settle AL Insurance Commissions Lawsuit -------------------------------------------------------------------- Synovus Financial settled a class action filed against one of its Alabama banking subsidiaries involving the receipt of commissions by that subsidiary in connection with the sale of credit life insurance to its consumer credit customers, including an interest surcharge and a processing fee in connection with the consumer loans made by that subsidiary. An earlier Class Action Reporter story states that the suit involves: (1) payment of service fees or interest rebates to automobile dealers in connection with the assignment of automobile credit sales contracts to that subsidiary; (2) the forced placement of insurance to protect that subsidiary's interest in collateral for which consumer credit customers have failed to obtain or maintain insurance; and (3) the receipt of commissions by that subsidiary in connection with the sale of credit life insurance to its consumer credit customers and the charging of an interest surcharge and a processing fee in connection with consumer loans made by that subsidiary. The Company agreed to settle the suit through a $3,500 payment to the named plaintiff. The lawsuit was dismissed, with prejudice to the named plaintiff, and without prejudice to the class claims, on February 27, 2003. TEMPLE INLAND: Trial in Linerboard Firms Suit Set For April 2004 in PA ---------------------------------------------------------------------- Trial in the consolidated class action filed against Temple Inland Inc. and Gaylord Chemical Corporation is set to commence in April 2004 in the United States District Court for the Eastern District of Pennsylvania. The suit alleges a civil violation of Section 1 of the Sherman Act, against the two companies and eight other linerboard manufacturers. The complaint alleges that the defendants, during the period from October 1, 1993, through November 30, 1995, conspired to limit the supply of linerboard, and that the purpose and effect of the alleged conspiracy was artificially to increase prices of corrugated containers. The plaintiffs moved to certify a class of all persons in the United States who purchased corrugated containers directly from any defendant during the above period, and seek treble damages and attorneys' fees on behalf of the purported class. The trial court granted plaintiffs' motion on September 4, 2001, but modified the proposed class to exclude those purchasers whose prices were "not tied to the price of linerboard." The United States Court of Appeals for the Third Circuit accepted review of the decision to certify the class and upheld the trial court's ruling. Defendants have appealed this decision to the United States Supreme Court. The Company believes that the plaintiffs' allegations have no merit. The Company believes the likelihood of a material loss from this litigation is remote and does not believe that the outcome of this litigation should have a material adverse effect on its financial position, results of operations, or cash flow. TUMBLEWEED COMMUNICATIONS: Shareholders File Securities Suit in S.D. NY ----------------------------------------------------------------------- Tumbleweed Communications Corporation faces a securities class action filed on behalf of persons who acquired Tumbleweed common stock (other than purchasers of Tumbleweed's initial public offering) during the time period from August 6, 1999 to October 18, 2000, inclusive, in the United States District Court in the Southern District of New York. According to the press release, the lead plaintiff in this purported lawsuit is a person whose deceased husband purchased approximately 2,700 shares of securities of Commerce One, Inc. In addition, the press release states that this purported lawsuit names the Company as a defendant, along with Jeffrey C. Smith and Joseph C. Consul (who served as the Company's CEO and CFO, respectively, during that time period). The Company has not been served with a summons or a complaint with respect to this purported securities class action. Although the Company believes these lawsuits are without merit, no assurance can be given about their outcome, and an adverse outcome could significantly harm our business and operating results. Moreover, the costs in defending the lawsuits could harm future operating results. TUMBLEWEED COMMUNICATIONS: Asks MI Court To Dismiss Securities Lawsuit ---------------------------------------------------------------------- Tumbleweed Communications has asked the United States District Court for the Eastern District of Michigan to dismiss the second amended consolidated securities class action filed against Interface Systems, Inc. (a company Tumbleweed acquired in 2000) and various additional defendants, including Interface's prior president and chief executive officer, Robert A. Nero, and Fiserv Correspondent Services, Inc. The suits, originally filed in the United States District Court for the Southern District of New York, contained substantially similar allegations of false and misleading representations by various defendants allegedly designed to inflate Interface's stock price. The complaints sought relief under the federal securities laws on behalf of purported classes of persons who purchased, held, or sold shares of Interface stock, and under various other causes of action. On July 27, 2001, the court granted the Company's motion to transfer the lawsuits to the Eastern District of Michigan. The court later dismissed with prejudice plaintiffs' class allegations and federal securities law claims that purportedly arose under Section 10(b) of the Securities Exchange Act of 1934. The plaintiffs then filed a second amended consolidated suit that consolidated the separate actions into one action, added certain new plaintiffs, withdrew Congressional Securities, Inc. as a plaintiff, and added claims for breach of fiduciary duty and negligent misrepresentation, which are the sole remaining claims in the case. The Company's motion for dismissal remains pending before the court while the case has continued to proceed through the discovery phase. The Company believes this consolidated action is without merit dismissal. TYSON FOODS: Manager Testifies Firm Officials Knew About Illegal Hiring ----------------------------------------------------------------------- Prosecutors in the immigrant-smuggling suit against poultry firm Tyson Foods wrapped up their case by presenting as witness a second manager who admitted knowingly hiring illegal workers for a Tyson poultry plant, the Associated Press reports. The poultry company faces allegations of hiring illegal immigrants from Mexico and Central America to reduce operating costs and boost production and profits. Tyson Shelbyville plant manager Spencer Mabe testified that although he was aware of illegal hires and dealt with an immigrant smuggler, he never personally inspected hiring records. Mr. Mabe, who was fired in 2001, pleaded guilty in a deal with prosecutors. He earlier testified that he went along with hiring illegal workers because he was dedicated to the company. "Any time they came through a recruiter, I pretty much knew they were illegal," Mr. Mabe said in court. The judge also heard motions by defense attorneys, who said the government had failed to prove that any defendant caused illegal immigrants to be brought into the United States, caused their transport or caused them to possess false Social Security numbers, the Associated Press states. He did not immediately rule. Prosecutors also presented tapes of secretly recorded conversations between undercover agents posing as immigrant smugglers and Tyson managers were a big part of the government's evidence. Some of those conversations indicated that the hiring of illegal immigrants, particularly through temporary agencies, was routine. Assistant US Attorney John MacCoon rested the government's case in the five-week-old trial Thursday. Defense attorneys expect their case to take two weeks, AP reports. The Company said the government's investigation involved only a few plant managers who independently violated Tyson's "zero tolerance" policy on illegal hiring. However, Mr. Mabe said that executives at the Company knew about plants hiring illegal workers. VEHICLE RECALLS: NHTSA Announces Several Passenger Vehicle Recalls ------------------------------------------------------------------ The United States National Highway Traffic Safety Administration (NHTSA) announced several vehicle recalls, according to Reuters. The most prominent is a recall of 84,000 X5 luxury sport utility vehicles by German auto-maker BMW AG, to fix a possible brake fluid leak. The NHTSA said the front brake line on X5s built between August 1999 and April 2002 could come loose, eventually causing a brake hose to rub against the tire and leak. According to Reuters, other actions announced by NHTSA included: (1) General Motors Corporation will recall 5,734 Chevrolet Avalanche pickups, as well as Chevy Suburban and GMC Yukon XL SUVs, to install a fuel tank shield. GM said in some frontal crashes, a piece of the frame could fracture, creating a sharp edge that could puncture a fuel tank; (2) Mitsubishi Motor Co. will recall some 65,000 of its new Outlander SUVs to reprogram an engine computer that could allow ice to build up inside the throttle, causing the throttle to stick open; (3) Honda Motor Co. Ltd. will recall 3,617 2003 Honda Odyssey minivans to inspect fuel tanks for signs of faults that could cause them to leak; (4) Hyundai Motor Co. will recall 25,643 Santa Fe SUVs to replace flawed engine electronics; (5) Ford Motor Co.'s Jaguar division will recall 49,174 X-Type sedans from model years 2002 and 2003 to fix a turn signal indicator that could fail; (6) Kia Motors Co. will recall 9,787 2002 Sedona minivans to replace seat belt anchor bolts that do not meet federal standards; and (7) GM's Saab unit will recall 70,726 Saab 9-5 cars from model years 1999 to 2003 to fix a corrosion problem on vehicles that switch between steel wheels in winter and alloy wheels in summer. ZIFF-DAVIS INC.: Court Refuses To Dismiss Employees' Stock Fraud Suit --------------------------------------------------------------------- The United States District Court for the District of Massachusetts refused to dismiss the class actions filed by two groups of Ziff-Davis, Inc.'s former employees. The lawsuits name as defendants the Company, Softbank Corporation and Softbank Holdings. The complaints allege violations of Section 10(b) and Section 20 of the Securities Exchange Act, violations of state laws against fraud and negligent misrepresentation and breach of fiduciary duty in connection with the exchange of the plaintiffs' options to purchase Softbank shares for options to purchase shares of Ziff-Davis in 1999, prior to CNET's acquisition of ZDNet. The complaints do not specify an amount of damages. Discovery is now underway. The Company cannot, at the moment, predict the outcome of the legislation. ZIFF-DAVIS INC.: NY Court Dismisses in Part Securities Fraud Lawsuits --------------------------------------------------------------------- The United States District Court for the Southern District of New York dismissed in part the securities class actions pending against Ziff- Davis, Inc., Eric Hippeau, Timothy O'Brien, and investment banks that were the underwriters of the public offering of ZDNet series of Ziff- Davis stock (the ZDNet Offering). One of the complaints also names CNET Corporation as a defendant, as successor in liability to Ziff- Davis. The complaints are similar and allege violations of the Securities Act of 1933, and one of the complaints also alleges violations of the Securities Exchange Act of 1934. The complaints allege the receipt of excessive and undisclosed commissions by the underwriters in connection with the allocation of shares of common stock to certain investors in the ZDNet Offering and agreements by those investors to make additional purchases of stock in the aftermarket at pre-determined prices. Plaintiffs allege that the prospectus for the ZDNet offering was false and misleading and in violation of the securities laws because it did not disclose the arrangements. The action seeks damages in an unspecified amount. The action is being coordinated with over 300 nearly identical actions filed against other companies. No date has been set for any responses to the complaints. On February 19, 2003, the court granted the Company's motion to dismiss the Section 10(b) claim with leave to replead, and denied the motion to dismiss the Section 11 claim. The issuers and their insurers have been engaged in settlement discussions with the plaintiffs. Meetings, Conferences & Seminars * Scheduled Events for Class Action Professionals ------------------------------------------------- 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 ANDRX CORPORATION: Johnson & Perkinson Files Securities Suit in S.D. FL ----------------------------------------------------------------------- Johnson & Perkinson initiated a securities class action in the United States District Court for the Southern District of Florida on behalf of purchasers and entities who purchased the common stock of Andrx Corporation (NasdaqNM: ADRX), between October 31, 2002 and March 4, 2003, inclusive. The complaint charges Andrx Corporation and certain of its officers with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5, by issuing false and misleading statements during the class period. Specifically, defendants misrepresented the Company's ability to obtain FDA approval of Andrx's generic version of Wellbutrin SR, an antidepressant drug. Andrx failed to disclose that its version of the drug had a limited expiration date, and that if it were not marketed by year end 2002, or soon thereafter, the Company would be forced to write off the value of that inventory. On March 5, 2003, Andrx stunned the market by announcing that it would record a $26.3 million charge in its fourth quarter 2002 results, related primarily to the Company's inventories of generic Wellbutrin. The Company's stock price dropped 31% from $11.51 on March 4 to $7.89 at the close on March 5, 2003 on heavy trading volumes. For more details contact Robin Freeman or James Conway by Mail: 1690 Williston Road, South Burlington, Vermont 05403 by Phone: 1-877-266-2133 by E-mail: email@jpclasslaw.com or visit the firm's Website: http://www.jpclasslaw.com BAYER AG: Milberg Weiss Commences Securities Fraud Lawsuit in S.D. NY --------------------------------------------------------------------- Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class action on behalf of purchasers of the publicly traded securities of Bayer AG between March 2, 1998 and February 21, 2003, inclusive. The action is pending in the United States District Court for the Southern District of New York against the Company and: (1) David Ebsworth, (2) Manfred Schneider and (3) Werner Wenning 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 between March 2, 1998 and February 21, 2003. Specifically, the complaint alleges that during the class period, defendants made false and misleading statements about the successful introduction and strong sales of the Company's new cholesterol fighting product, Baycol, and represented that the Company enjoyed and would continue to enjoy strong revenue, earnings and earnings per share growth as a result of the addition of Baycol to the Company's product line. The complaint further alleges that defendants also misrepresented that Baycol was safe for use by patients attempting to treat high cholesterol and did not present a significant risk of adverse side effects. In fact, Baycol was not safe but rather, dangerous to the public requiring the drug to be withdrawn. Baycol caused fatal Rhabdomyolysis in patients who used Baycol in combination with gemfibrozil, another lipid lowering drug, the complaint alleges. The complaint further alleges that senior executives at Bayer were aware that Baycol had serious problems and presented health risks to patients long before the Company pulled the drug from the market in August 2001, and that defendants overstated Bayer's assets and understated its liabilities (totaling in excess of $257 million) associated with the Company overcharging Medicaid, the United States government's health plan for the poor. For more details, contact Steven G. Schulman by Mail: One Pennsylvania Plaza, 49th fl. New York, NY. 10119-0165 by Phone: (800)320-5081 by Email: bayer@milbergNY.com or visit the firm's Web site: http://www.milberg.com BLACK BOX: Cauley Geller Commences Securities Fraud Lawsuit in W.D. PA ---------------------------------------------------------------------- Cauley Geller Bowman Coates & Rudman, LLP initiated a securities class action in the United States District Court for the Western District of Pennsylvania, on behalf of purchasers of Black Box Corporation (Nasdaq: BBOX) publicly traded securities during the period between October 15, 2002 and March 11, 2003, inclusive. 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 between October 15, 2002 and March 11, 2003, thereby artificially inflating the price of Black Box securities. Throughout the class period, as alleged in the complaint, defendants failed to disclose and misrepresented these material adverse facts: (1) that the Company's European operations were not performing well and would have to be scaled down significantly and staffing levels reduced accordingly; (2) that the Company was improperly delaying the write down of a material amount of uncollectible receivables, thereby overstating its financial results; and (3) that the Company was experiencing declining demand for its products and services and was not performing according to its internal plans. The class period ends on March 11, 2003. On that date, Black Box shocked the market when it announced that it expects earnings for the fourth quarter, the period ending March 31, 2003, to be between 53 cents and 54 cents, prior to one-time charges -- as compared to analysts earnings estimates of 74 cents per share. The Company further reported that it would be recording a $9 to $10 million one-time pre- tax charge, or 29 cents to 32 cents per share. In response to this announcement, the price of Black Box common stock dropped from $39.14 per share to $26.78 per share, a decline of 31%, on extremely heavy volume. During the class period, Black Box insiders sold their personally-held shares of Black Box common stock generating proceeds of more than $5 million. 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 COLLINS & AIKMAN: Milberg Weiss Launches Securities Lawsuit in E.D. MI ---------------------------------------------------------------------- Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities class action on March 24, 2003, on behalf of purchasers of the securities of Collins & Aikman Corp. (NYSE: CKC) between August 7, 2001 and August 2, 2002, inclusive. The action is pending in the United States District Court for the Eastern District of Michigan against the Company, Heartland Industrial Partners L.P. and ten senior officers and/or directors of CKC. 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 between August 7, 2001 and August 2, 2002. The complaint alleges that Heartland was at all relevant times a private equity firm that presented itself as being expert in leveraged buyouts of industrial manufacturers and that, in February 2001, Heartland acquired a controlling interest in CKC. CKC was at all relevant times a manufacturer of automotive interior components. The complaint further alleges that Heartland and CKC acquired Textron Automotive Company's TAC-Trim division and that, throughout the class period, Heartland and CKC repeatedly stated that the TAC-Trim acquisition would be accretive to earnings and that, in addition to doubling CKC's annual revenue, the TAC-Trim acquisition would increase operating income by reducing costs through synergies and economies of scale. The truth was revealed on August 5, 2002, when the Company reported a net loss of $20.3 million, or $0.29 per diluted share, compared with net income of $9.2 million, or $0.11 per diluted share a year earlier, and announced that it expected 2002 earnings to be $0.20 to $0.26 per share, well below the consensus estimate of $0.74 per share. On this news, the investing public dumped its CKC stock, pushing the price down 49% to close at $2.81 on relatively high trading volume. For more information, visit the firm's Website: http://www.milberg.com/cases/collins/ HEALTHSOUTH CORPORATION: Schiffrin & Barroway Files Lawsuit in N.D. AL ---------------------------------------------------------------------- Schiffrin & Barroway, LLP initiated a securities class action in the United States District Court for the Northern District of Alabama, on behalf of all purchasers of the common stock of HealthSouth Corporation (NYSE:HRC) publicly traded securities during the period between February 25, 1998 and March 19, 2003, inclusive. Throughout the class period, as alleged in the complaint, defendants issued numerous statements which described the Company's increasing revenues and profits. As alleged in the complaint, these statements were materially false and misleading because they failed to disclose and/or misrepresented these adverse facts, among others: (1) that since at least fiscal 1997, in violation of Generally Accepted Accounting Principles (GAAP), the Company had materially overstated the Company's revenues and profits in order to meet or exceed Wall Street analysts' expectations and to artificially inflate the price of HRC's stock; (2) that since at least fiscal 1999 in violation of GAAP the Company had materially overstated the Company's revenues, earnings, assets and equity by at least $1.4 billion in furtherance of its scheme to report revenues that met or exceeded Wall Street analysts' expectations and to artificially inflate the price of HRC's stock analysts; and (3) that as a result, the value of the Company's periodic net income, assets and shareholders' equity were materially misstated at all relevant times. The class period ends on March 19, 2003, the day following the SEC's filing of a civil fraud action against HRC and Mr. Scrushy alleging that "... shortly after 1986, and at Mr. Scrushy's instruction, the company began to artificially inflate earnings to match Wall Street expectations and maintain the market price for HRC's stock." On March 19, 2003, prior to the market's opening, HRC issued a press release announcing that agents from the Federal Bureau of Investigation served a search warrant at the company's corporate headquarters. Also on March 19, 2003, the SEC issued notice that trading in HRC's common stock had been suspended, the stock's last reported closing was at $3.91 per share on March 18, 2003, compared to a class period high of $30.5625 reached on May 1, 1998. For more information, contact Marc A. Topaz or Stuart L. Berman by Phone: 888-299-7706 (toll free) or 610-822-2221 by Fax: 610-822-0002 by E-mail: info@sbclasslaw.com or visit the firm's Web site: http://www.sbclasslaw.com. MICROTUNE INC: Marc Henzel Commences Securities Fraud Suit in E.D. TX --------------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Eastern District of Texas, Sherman Division on behalf of all purchasers of the common stock of Microtune, Inc. (Nasdaq:TUNE) from April 22, 2002 to February 20, 2003, inclusive. The complaint charges Microtune, Inc. and certain of its officers and directors with issuing false and misleading statements concerning its business and financial condition. Specifically, the complaint alleges that defendants issued numerous statements and filed quarterly reports with the SEC which described the Company's increasing revenues and financial performance. These statements were materially false and misleading because they failed to disclose and/or misrepresented the following adverse facts, among others: (1) that the Company had materially overstated its revenue by immediately recognizing as revenue certain sales which should have been categorized as deferred revenue, as payment was not assured and in fact was not made for substantial periods of time; (2) that the Company failed to disclose that a material portion of its revenues had not in fact been paid for; (3) that the Company lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company; and (4) as a result of the foregoing, the Company's financial statements issued during the class period were materially false and misleading. On February 20, 2003, the last day of the class period, after the close of regular trading, Microtune shocked the market by announcing that its loss for the fourth quarter of 2002, the period ending December 31, 2002, was $80.2 million, or almost double the loss of $47 million which it had reported in the same period of the prior year. Despite having shipped $16.1 million of product during the fourth quarter of 2002, the Company announced that it would only be reporting revenues of $2.2 million "as a result of charges relating to five customers, including (a) credits granted and/or (b) lack of timely payments." As a result of this development, the Company announced that its Board of Directors has directed its audit committee to conduct an inquiry of the events that led to these "material negative charges." The next morning, when the market opened for trading, shares of Microtune fell more than 35%, to approximately $1.20 per share, a far cry below their class period high of $13.81 per share, on extremely heavy trading volume. For queries, contact Marc S. Henzel by Mail: 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 Web site: http://members.aol.com/mhenzel182. MICROTUNE INC: Wolf Haldenstein Files Securities Fraud Suit in E.D. TX ---------------------------------------------------------------------- Wolf Haldenstein Adler Freeman & Herz LLP initiated a securities class action in the United States District Court for the Eastern District of Texas, Sherman Division, on behalf of all persons who purchased the common stock of Microtune, Inc. (Nasdaq: TUNE) between April 22, 2002 and February 20, 2003, inclusive. During the class period, defendants made misrepresentations and/or omissions of material fact, including the following: (1) Microtune had materially overstated its revenue by immediately recognizing as revenue certain sales which should have been categorized as deferred revenue since payment had not been assured and had not been made for considerable amounts of time; (2) the Company failed to disclose that a material portion of its revenues had not in fact been received in cash; and (3) Microtune lacked adequate internal controls and was therefore unable to determine its true financial condition at a given time. After the truth of the foregoing became known on February 20, 2003, when Microtune announced that its loss for the Fourth Quarter 2002, the period ending December 31, 2002, was $80.2 million, or almost twice the loss of $47 million which it had reported in the same period of the previous year, the Company's share price dropped to as low as $1.09 per share, down from a class period high of $15.20 per share. For more information, contact Fred Taylor Isquith, 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 Web site: http://www.whafh.com. All e-mail correspondence should make reference to Microtune. PARAMETRIC TECHNOLOGY: Goodkind Labaton Files Securities Lawsuit in MA ---------------------------------------------------------------------- Goodkind Labaton Rudoff & Sucharow LLP initiated a securities class action in the United States District Court for the district of Massachusetts on behalf of all those who purchased or otherwise acquired the common stock of Parametric Technology Corporation (NASDAQ:PMTC) between October 19, 1999 and December, 31, 2002, inclusive. The named defendants are the Company and: (1) Steven C. Walske, (2) Noel G. Posternak, (3) C. Richard Harrison and (4) Edwin J. Gillis The complaint charges defendants with violations of Sections 10(b) and 20 of the Securities Exchange Act of 1934. Parametric is a company that purports to develop, market and support collaborative product development (CPD) software solutions that help manufacturers improve the competitiveness of their products and product development processes. The complaint alleges that between October 19, 1999 and December 31, 2002, Parametric issued a number of press releases, and filed a number of quarterly and yearly reports with the Securities and Exchange Commission, that misled members of the class as to the true value of the Company. Specifically, the complaint alleges that, in the press releases and quarterly and yearly reports, defendants stated, among other things, that service revenue had increased "as a result of growth in our installed customer base and increased training and consulting services performed for these customers," that such increases were "positive signs for continued revenue and operational improvement in upcoming quarters," and that service revenue margins improved "as a result of a higher mix of maintenance revenue." However, the complaint alleges that defendants statements were materially false and misleading because they failed to disclose and/or misrepresented that: (i) during the class period, Parametric had overstated its previously recognized maintenance revenue from its service contracts by approximately $33.4 million in violation of Generally Accepted Accounting Principles (GAAP) and its own revenue recognition policies; (ii) Parametric lacked adequate internal controls and was therefore unable to ascertain the true financial condition of the Company, and (iii) as a result, the value of the Company's income and financial results were materially overstated at all relevant times. The complaint further alleges that on December 31, 2002, after the close of 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." Parametric also announced that it would file with the SEC for an automatic 15-day extension of time to file its Annual Report on Form 10-K for the fiscal year ended September 30, 2002, in order to permit the company to complete its analysis of the maintenance revenues from its service contracts. On January 2, 2003, shares of Parametric closed at $2.19 per share, compared with a class period high of $32.88 per share reached on December 16, 1999. On January 17, 2003, Parametric announced that it had received a Nasdaq Staff Determination letter indicating, among other things, that the company's common stock was subject to possible delisting from the Nasdaq National market because of the company's failure to comply with filing requirements. On January 29, 2003, the company announced that it had filed with the SEC its 2002 10-K, a document that included restated financial results for the fiscal years 1999, 2000 and 2001. The company's analysis identified a total of $33.4 million in maintenance revenue that should have been deferred at September 30, 2002 and recognized in fiscal 2003 and later periods. For more information, contact Lynda J. Grant, Esq. by Mail: 100 Park Avenue, 12th Floor, New York, New York 10017-5563 by Phone: 212/907-0700 by E-mail: lgrant@glrslaw.com or visit the firm's Web site: http://www.glrslaw.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 * * *