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C L A S S A C T I O N R E P O R T E R
Wednesday, May 7, 2003, Vol. 5, No. 89
Headlines
ANTHEM INC.: To Settle IN Policyholders Lawsuit For $1.36 Million
APARTHEID LITIGATION: Officials Criticize Ed Fagan's NY Lawsuits
BARNEYS NEW YORK: CA Court Approves Consumer Lawsuit Settlement
CALIFORNIA PIZZA: Employees Commence Overtime Wage Lawsuit in CA
CHAMPION PAPER: TN Landowners Settle Over Paper Plant Discharges
COMBINED INSURANCE: Plaintiffs Launch Sexual Abuse, Bias Lawsuit
FREEMARKETS INC.: PA Court Refuses To Dismiss Securities Lawsuit
FREEMARKETS INC.: NY Court Refuses To Dismiss Securities Lawsuit
COSMECEUTICAL CREATIONS: Recalls Contaminated Mascara
FOREVER CHEESE: Recalls Apricot Bars Due To Undeclared Sulfites
GROCERY CHAINS: Three Chains Agree To Re-label Sold Farmed Salmon
INDIAN FUNDS: Ex-Trustee Says Interior Dept Records Unreliable
JO-ANNE STORES: Finalizes California Overtime Lawsuit Settlement
LEXENT INC.: DE Court Consolidates Six Securities Fraud Lawsuits
LEXENT INC.: NY Court Dismisses Securities Fraud Lawsuit in Part
LEXENT INC.: Employees Launch Suits For Civil Rights Violations
LOUISIANA: LA Court Allows Crawfish Lawsuit To Proceed To Trial
LOUISIANA-PACIFIC: CA Court Dismisses Two Consumer Suit Claims
LOUISIANA-PACIFIC: Dismissed By OR Court From ERISA Fraud Lawsuit
MANUFACTURERS SERVICES: Court Dismisses Securities Suit in Part
MARVELL TECHNOLOGY: Court Partially Dismisses Securities Lawsuit
MCLEODUSA INC.: Hearing on Motion To Dismiss Stock Suit Starts
MEN'S WEARHOUSE: Trial in Consumer Fraud Suit Set May 2003 in CA
MEN'S WEARHOUSE: Employees Launch Two Lawsuits Over Overtime Wage
MICROSOFT CORPORATION: Reaches Settlement in MT Antitrust Suit
NATURE'S YOUTH: Completes Recall of Supplement Over False Claims
NEW JERSEY: Car Dealers Face Consumer Lawsuit Over Extra Charges
OREGON: Inmates Commence Lawsuit Over Treatment For Hepatitis C
ORKIN EXTERMINATING: Consumers Sue For Fraudulent Wood Treatments
PEP BOYS: To Ask Court To Reconsider Overtime Suit Certification
QUINTILES TRANSNATIONAL: NC Securities Suits Ordered Consolidated
RITE-AID CORPORATION: Fairness Hearing For Settlement Set May 2003
RITE-AID CORPORATION: Plaintiffs Appeal Securities Suit Dismissal
SEDONA CORPORATION: Launches Securities Fraud Lawsuit in S.D. NY
Meetings, Conferences & Seminars
* Scheduled Events for Class Action Professionals
* Online Teleconferences
New Securities Fraud Cases
PHARMACIA CORPORATION: Marc Henzel Lodges Securities Suit in NJ
SUPERGEN INC.: Marc Henzel Commences Securities Suit in N.D. CA
*********
ANTHEM INC.: To Settle IN Policyholders Lawsuit For $1.36 Million
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Anthem Inc. will settle for $1.36 million a class action filed by
Indiana policyholders who charged the Blue Cross-Blue Shield company
with reneging on paying for skilled nursing care, IndyStar.com reports.
Initially, an individual lawsuit was filed in 1998 by a daughter of
former Indianapolis librarian Elizabeth E. Ewing, who died in a
Shelbyville nursing home. The suit alleged that Anthem, Inc. denied
Ms. Ewing $75,000 in claims for skilled nursing care, even though her
Blue Cross policy promised skilled nursing coverage up to $1 million.
Plaintiffs said in court documents that Anthem "created secret criteria
for coverage of the skilled nursing facility benefit" that were much
more restrictive in outlining the care Anthem would pay for than the
wording in copies of policies given to customers, the IndyStar.com
reports. The suit was later made a class action on behalf of Indiana
residents who bought the Company's policies since January 1996 that
contained the skilled nursing benefit and had claims denied based on
Anthem's medical policies.
About 69 policyholders or their heirs would share in the pact, court
records state. The policyholders would recover 70 percent of their
actual unpaid claims, if court approves the suit. A hearing, with
possible court approval of the proposed settlement, was set for this
week but was postponed to May 16 before Judge Gary Miller of Marion
Superior Court. Judge Miller also must decide whether to approve
$475,000 in attorney fees and $114,396 in costs requested by three
legal firms in an affidavit filed Tuesday.
The Indianapolis insurer said it agreed to settle the case, which dates
to early 1999, because "we felt continued litigation wasn't in the best
interest of our customers or our company," spokeswoman Deborah New said
Thursday, IndyStar.com reports.
APARTHEID LITIGATION: Officials Criticize Ed Fagan's NY Lawsuits
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South African President Thabo Mbeki and Minister of Trade and Industry
Alec Erwin sternly rebuked lawyers threatening to file class actions
against the country's largest companies over its participation in the
country's apartheid regime, ending the government's silence on this
matter, Miningweb Australia reports.
Prominent lawyer Ed Fagan, best known for his role in the suit for
Holocaust victims, is initiating two class actions against several
local and international companies, seeking billions of dollars in
reparations for apartheid victims. Several big companies such as IBM
have been named as defendants.
Minister Erwin said the government would not allow any foreign
judgements to be enforced in South Africa. The state also said a once-
off reparations tax for victims of Apartheid, would not be levied on
business, Miningweb states. In speeches described as "masterful" by
HSBC political analyst Nick Borain, Mr. Erwin and Mr. Mbeki
unequivocally quashed any hopes US-based attorneys Ed Fagan and Charles
Abrahams may have had of government support - tacit or implicit - for
their Apartheid crusade against businesses operating in South Africa.
They warned the lawyers and their South African associates to back off
in separate, combative speeches before parliament.
"(It) is an abuse to use the law, unsound law at that, of another land
to undermine our sovereign right to settle our past and build our
future as we see fit. South Africans involved in this break that
indefinable collectivist identity that was the origin of our strength.
The government rejects the actions of legal practitioners in the USA to
exploit our history and will not allow any judgement made in the USA or
elsewhere to be carried out in South Africa," Mr. Erwin said.
President Mbeki also added his voice to the growing chorus of
dissenters in South Africa, Miningweb states. "We consider it
completely unacceptable that that matters that are central to the
future of our country should be adjudicated in foreign courts which
bear no responsibility for the well-being of our country and the
observance of the perspective of our constitution of the promotion of
national conciliation," he said.
The comments were made at the release of the final report of the Truth
and Reconciliation Commission (TRC), a body set up by the government to
hear the testimony of victims and perpetrators of gross human rights
abuses committed during the Apartheid years. The report suggested
various forms of government-sponsored redress for victims of Apartheid-
related violence.
BARNEYS NEW YORK: CA Court Approves Consumer Lawsuit Settlement
---------------------------------------------------------------
The Superior Court for the State of California, County of San Diego
granted preliminary approval to the settlement of a class action filed
against Barneys New York, Inc., alleging two causes of action for
purported violations of California's Civil Code and Business and
Professions Code relating to the alleged requesting by the Company of
certain information.
The complaint seeks relief on a class basis under the statutes
permitting a plaintiff to recover a fine, in the discretion of the
court, and such other damages which each member of the class may have
suffered as a result of the Company's alleged conduct. The complaint
further seeks an accounting of all moneys and profits received by the
Company in connection with the alleged violations as well as injunctive
relief with respect to the alleged practices. Class certification and
attorneys fees are sought as well.
The Company believes that the complaint is without merit, that it has
substantial defenses to the claims and plans to vigorously defend the
lawsuit. A proposed settlement of this matter received preliminary
court approval on May 1, 2003. The settlement is subject to final
court approval on June 20, 2003 as well as satisfaction of certain
other conditions.
No assurances can be given that the proposed settlement will be
finalized in accordance with its terms. In management's judgment,
based in part on consultation with legal counsel, neither this case nor
the proposed settlement is expected to have a material adverse effect
on the Company's financial position.
CALIFORNIA PIZZA: Employees Commence Overtime Wage Lawsuit in CA
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California Pizza Kitchen, Inc. faces a class action filed in the Orange
County Superior Court in California by one of its former servers,
alleging that the Company failed to give its food servers, bussers,
runners and bartenders rest and meal breaks as required by California
law.
Under the California Labor Code, an employer must pay each employee one
additional hour of pay at the employee's regular rate of compensation
for each work day that the required meal or rest period is not
provided. The plaintiff also alleges that additional penalties are
owed as a consequence of a resulting failure to pay all wages due at
the time of termination of employment and characterizing these alleged
breaches as unfair business practices. If the plaintiff is able to
achieve class certification and prevail on the merits of the case, the
Company could potentially be liable for significant amounts.
The Company has investigated the claims and responded to the complaint.
No date has been set for a hearing on class certification or for trial.
The Company believes that all of its employees were provided with the
opportunity to take all required meal and rest breaks. Additionally
the Company believes all terminated employees have been paid fairly and
in compliance with federal, state and/or local laws and as such, it
intends to vigorously defend its position.
CHAMPION PAPER: TN Landowners Settle Over Paper Plant Discharges
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Landowners near the Pigeon River in Tennessee, have settled out of
court with the Champion Paper Co. over charges, filed six years ago,
that the value of the land abutting the Pigeon River was damaged by
discharges from the company's paper plant in Canton, North Carolina,
the Associated Press Newswires reports. Final settlement awaits
approval by an administrator, and a hearing on the proposed settlement
is scheduled for June 20.
The proposed agreement was announced recently by attorney Gordon Ball,
who said landowners of the land in Cocke County would receive damages
ranging from $1,000 to $10,000 each if they sign the settlement
agreement, for a total of $3.4 million.
The settlement monies will be awarded to the plaintiff landowners based
on the size of their properties, length of ownership and potential use
of the property. Those who participate must submit proof of claim and
give up any rights to sue Champion in the future.
The plant was sold in June 1999, to employees of the company, who then
formed the Blue Ridge Paper Co. That company was named recently as a
defendant in a new class action in Cocke County Circuit Court. The new
lawsuit seeks damages up to $74,000 for each property owner. The
second lawsuit alleges decline in property values and that use of both
the property and river have dropped as a result of the pollution.
COMBINED INSURANCE: Plaintiffs Launch Sexual Abuse, Bias Lawsuit
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Plaintiffs in the sexual harassment and discrimination suit filed
against Combined Insurance Co. of America filed a brief supporting
class certification for the suit in the United States District Court in
Illinois, Chicago, the Insurance Journal National News reports.
The brief includes excerpts from 128 declarations signed by former and
current women employees who described the "the pervasive discriminatory
and sexually charged atmosphere of a male-dominated institution that
allowed discrimination and harassment to run unchecked."
Plaintiffs' attorneys Meites Mulder Burger & Mollica and Benassi &
Benassi stated that the company "barely pays lip service to its
obligation of equal treatment under Title VII, but instead lets the
company culture of discrimination flourish despite the real human cost
to its female employees."
The brief also cited an opinion by Federal Judge James Zagel in a
companion case filed by current employee Brenda Palmer. In a move
denying the Company's motion to dismiss class allegations, Judge Zagel
said the allegations suggest that "embedded within the very foundation
upon which Combined rests is a chauvinistic and fundamentally
misogynist view of women that is reflected in its company-wide
practices and patterns."
The case involves Combined's "Seventh Essential Enhanced Sales Force,"
which sells health, disability and accident insurance door to door.
Complaints include a lack of highly ranked women managers on the sales
force, and constant harassment and attacks on women at every level of
the company by workers and supervisors. One woman even alleged she was
gang-raped after a group sales meeting, Insurance Journal National News
states.
Spokesman for Aon, the Company's parent, Al Orendorff said the charges
"self-serving and baseless," the Insurance Journal National News
reports. He continued ".Combined is absolutely dedicated to
maintaining a diverse, harassment-free workplace and will not tolerate
conduct inconsistent with that policy."
FREEMARKETS INC.: PA Court Refuses To Dismiss Securities Lawsuit
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The United States District Court in Pittsburgh, Pennsylvania refused to
dismiss the consolidated securities class action filed against
Freemarkets, Inc. and two of its executive officers in federal court.
The suit stems from the Company's announcement on April 23, 2001 that,
as a result of discussions with the Securities and Exchange Commission
(SEC), the Company was considering amending its 2000 financial
statements for the purpose of reclassifying fees earned by the Company
under a service contract with Visteon.
On October 30, 2001, the Company filed a motion seeking to dismiss all
of the cases in their entirety, which the court dismissed. The case is
now in the class certification phase.
In addition, on September 24, 2001, an individual claiming to be a
FreeMarkets shareholder filed a shareholder's derivative action,
nominally on behalf of FreeMarkets, against all of the Company's
directors and certain of its executive officers. The Company is also
named as a nominal defendant. The suit is based on the same facts
alleged in the foregoing securities fraud class actions and was stayed
pending a ruling on the Company's motion to dismiss those class
actions.
The Company believes that the plaintiffs' allegations are without merit
and it intends to defend these claims vigorously.
FREEMARKETS INC.: NY Court Refuses To Dismiss Securities Lawsuit
----------------------------------------------------------------
The United States District Court for the Southern District of New York
refused to dismiss the consolidated securities class action filed
against Freemarkets, Inc., certain of its officers and the underwriters
of its initial public offering (IPO), alleging violations of the
securities laws.
The consolidated suit alleges that the prospectus used in the Company's
IPO contained material misstatements or omissions regarding the
underwriters' allocation practices and compensation in connection with
the IPO, and also alleges that the underwriters manipulated the
aftermarket for the Company's stock. Damages in an unspecified
amount are sought, together with interest, costs and attorney's fees.
In addition, the cases have been consolidated for pretrial purposes
with approximately 1,000 other lawsuits filed against other issuers,
their officers, and underwriters of their initial public offerings.
The defendants filed a motion to dismiss the suit. By stipulation
and order dated October 9, 2002, the individual defendants were
dismissed without prejudice from the suit. On February 19, 2003, the
court denied the Company's motion to dismiss.
The Company believes that the claims asserted against it are without
merit, and it intends to defend these claims vigorously.
COSMECEUTICAL CREATIONS: Recalls Contaminated Mascara
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Cosmeceutical Creations Corporation (CCS) is warning consumers not to
purchase or use Leslie Dee Ann Jet Black Mascara. This product,
manufactured by Cosmeceutical Creations Corporation (CCC) located in
New Zealand, is found to be contaminated with harmful bacteria. CCC is
voluntarily recalling the product to protect consumers with the
knowledge with the US Food and Drug Administration.
This recall was the result of a routine sampling program by the US
distributor, Neways, Inc., that revealed that finished products
contained the bacteria Pseudomonas Aeruginosa, which can cause serious
eye problems. Neways Inc. immediately informed CCC of the contaminated
products and also contacted FDA on April 22, 2003.
The following lots are subject to this recall:
Lot 3401:
Lot 1302:
Lot 1562:
Lot 1572:
Lot 2142:
Lot 0732:
All of the above referenced lot numbers involve individual 10g tubes of
Leslie Dee Ann Jet Black Mascara. Tubes are gold in color, and are
individually packaged in white boxes that are marked with the terms
"LDT", "Leslie Dee Ann", "Mascara", "10g", "Jet Black", and a lot
number.
Approximately 12,571 units are subject to this recall. Neways Inc. is
coordinating the recall for CCC, and intends to notify all distributors
who received these products. Consumers who have used this product
should contact their physician if they experience any problems with
their eyes. Individuals who have purchased Leslie Dee Ann Jet Black
Mascara are urged to discard it and contact Neways, Inc. for a full
refund or credit. No injuries or adverse events in the United States
have been reported to Neways Inc., to date, in connection with the use
of the above products.
For more information on the recall please contact Neways Inc. by Phone:
1-800-998-7232.
FOREVER CHEESE: Recalls Apricot Bars Due To Undeclared Sulfites
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Forever Cheese is recalling 2-ounce packages of "Mitica Apricot Bars",
because they may contain undeclared sulfites. People who have an
allergy or severe sensitivity to sulfites run the risk of serious or
life threatening allergic reaction if they consume this product. The
2-ounce packages of "Mitica Apricot Bars" were distributed in the tri-
state area of NY, NJ and CT through specialty food stores.
The product is packaged in a 2-ounce clear plastic package. There is no
apparent code. It is labeled "Product of Spain". No illnesses have
been reported to date.
The recall was initiated after it was discovered that product
containing sulfites was distributed in packaging that did not reveal
the presence of sulfites. Distribution of the product has been
suspended until product is properly labeled.
For more details, contact the Company by Phone: 1-888-930-8693
GROCERY CHAINS: Three Chains Agree To Re-label Sold Farmed Salmon
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Grocery chains Kroger, Safeway and Albertsons agreed to re-label farmed
salmon being sold in their stores, after several class actions were
filed in California and Washington courts over the artificial coloring
of the farmed salmon, the Grocer Network News reports.
The suits claim that the three largest grocery chains in the United
States - Safeway, Albertsons and The Kroger Company - illegally
concealed the artificial coloring in their farm-raised salmon. Without
this artificial coloring, farmed-salmon fillets would be an
unappetizing gray - something most fish lovers don't know, an earlier
Class Action Reporter story states. Federal and Oregon state laws
require that farm-grown salmon bear labels that show the use of
artificial colorants.
Kroger was the first to act on the suits, and Safeway and Albertsons
followed shortly afterwards. They confirmed that they will label their
farmed salmon and trout to indicate color has been added. They would
also notify customers of the added color either on package labeling or
in a placard in refrigerated cases.
A spokesman for pharmaceutical company Hoffmann-La Roche told the
Grocer Network News the artificial colors, astaxanthin and
canthaxanthin, are basically the same compounds that wild salmon
collect in their food while roaming the sea.
The additives "enhance the pigmentation" of farmed fish, Keith Neer,
Kroger's VP of corporate food technology and regulatory compliance told
Grocer News. "While the supplements do not affect the taste or
nutritional value of the fish, we are modifying the product labels to
share this information with our consumers."
Knoll Lowney, the Seattle attorney who filed the cases, said he has
heard from many consumers who said they would not have bought salmon
they knew was artificially colored, Grocer Network News states. The
decision by the chains to start labeling "not only admits they haven't
been labeling, it also shows that labeling is controlled centrally;
thus the previous decision not to label was made centrally too," he
said.
INDIAN FUNDS: Ex-Trustee Says Interior Dep't Records Unreliable
---------------------------------------------------------------
A president-appointed trustee for Indian trust reform, Paul Homan,
who resigned in protest, has said that the Interior Department cannot
be relied upon for accurate records, and that it has no way of
accurately assessing Indian claims for money they are owed, the Duluth
News-Tribune reports.
Mr. Homan testified recently as a lead witness in a $137 billion class
action, filed nearly seven years ago on behalf of more than 300,000
Indian plaintiffs. Their lawyers are contending in court with the
Interior Department over which plan US District Court Judge Royce C.
Lamberth should accept for the purpose of straightening out the
mismanaged Indian trust fund accounts dating back to 1887.
The Interior Department has proposed a historical accounting using
limited statistical sampling and transaction-by-transaction analysis.
This process, the Department has said, would take at least five years
to complete.
The Indian plaintiffs have proposed identifying all money generated
over the years of the life of the trust, from the individual trust
lands. This would be done by using independent databases kept by
industry, and is a process that could be completed within a matter of
weeks the plaintiffs said.
Mr. Homan said the Department has not kept pace with modern accounting
procedures: It has scattered many of the records of debits, credits,
checks and deposits that would be needed for a full tally of uncounted
revenues for use of Indian lands for oil drilling, timber harvesting
and cattle grazing, among others, which were paid to the government for
forwarding to the landowners.
JO-ANNE STORES: Finalizes California Overtime Lawsuit Settlement
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Jo-Anne Stores, Inc. has fully paid for the settlement of a class
action filed by former employee Sandy Lortz on behalf of the Company's
former and current California store management employees. The suit was
filed in the Superior Court of California and alleged the Company
violated certain California laws by erroneously treating its store
management employees as "exempt" employees who are not entitled to
overtime compensation. This case was consolidated with a similar class
action complaint filed on behalf of Regina Salas, filed on October 24,
2000 in the Superior Court of California.
A settlement in this case was reached and a pre-tax charge of $6.5
million was recorded in the fourth quarter of fiscal 2002. The
settlement was paid in the first quarter of fiscal 2003.
LEXENT INC.: DE Court Consolidates Six Securities Fraud Lawsuits
----------------------------------------------------------------
Six class actions filed against Lexent, Inc. were consolidated in the
Delaware State Court. The suit also names as defendants Hugh J.
O'Kane, Jr. and Kevin M. O'Kane.
The suits were filed in connection with an offer received by the
Company from a buying group, which included the individual defendants,
to purchase all outstanding shares of the Company (not owned by the
buying group) for $1.25 per share. One of the lawsuits also named, as
defendants, several former members of the Company's Board of Directors.
The suits allege, inter alia, that the offer is unfair and inadequate,
the buying group has engaged in self-dealing and has not acted in
good faith, and that the Company and its Board of Directors, present
and former, have breached their fiduciary duty to shareholders. The
board of directors was not named in the consolidated suit.
It is too early to assess the possible outcome of these matters.
Therefore, at present it cannot be determined whether the ultimate
outcomes of these matters will have a material impact on the Company's
financial position or results of operations.
LEXENT INC.: NY Court Dismisses Securities Fraud Lawsuit in Part
----------------------------------------------------------------
The United States District Court for the Southern District of New York
dismissed in part the consolidated securities class action filed
against Lexent, Inc., certain of its present and former senior
executives and its underwriters.
The complaint alleges that the registration statement and prospectus
relating to the Company's initial public offering contained material
misrepresentations and/or omissions in that those documents did not
disclose that:
(1) certain underwriters had solicited and received undisclosed
fees and commissions and other economic benefits from some
investors in connection with the distribution of the Company's
stock in the initial public offering; and
(2) certain underwriters had entered into arrangements with some
investors that were designed to distort and/or inflate the
market price for the Company's stock in the aftermarket
following the initial public offering.
The suit against the Company is part of a number of initial public
offering securities claims against multiple issuers and underwriters
presently pending before the Judge. No discovery has occurred in
the suit involving the Company.
On February 19, 2003, US District Court Judge Scheindlin issued an
opinion denying the Motion to Dismiss the Section 11 claims against the
Company but granting said motion, without prejudice, with respect to
the Section 10 (b)(5) claims.
The Company intends to defend itself vigorously. All individual
present and former senior executive defendants have been dismissed from
the case without prejudice. Management currently believes that the
resolution of this litigation will not have a material adverse impact
on the Company's financial position or the results of operations,
although the ultimate outcome of this matter cannot be determined at
this time.
LEXENT INC.: Employees Launch Suits For Civil Rights Violations
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Lexent, Inc.'s subsidiary Hugh O'Kane Electric Co., LLC faces two
lawsuits on behalf of its employees alleging violations of Title VII of
the Civil Rights Act of 1964, as amended.
The first suit is pending in the United States District Court in the
District of Maryland and seeks compensatory and punitive damages.
Another suit was filed in the same court by the US Equal Employment
Opportunity Commission on behalf of other employees. The EEOC Action
seeks compensatory damages and injunctive relief.
The Company intends to defend itself vigorously in both actions. The
Company's answers in both actions have been filed, and limited
discovery has been conducted in connection with mediation proceedings.
It is too early to assess the ultimate outcomes of the above-referenced
matters served upon the Company.
LOUISIANA: LA Court Allows Crawfish Lawsuit To Proceed To Trial
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Louisiana crawfish farmers will get their day in court, and that day
will be in March of 2004. St. Landry Parish District Court Judge James
Genovese handed down this and several other key rulings that will allow
the farmers' class action to proceed towards trial.
The lawsuit was filed in St. Landry Parish District Court in 2000. The
crawfish farmers allege that the pesticide ICON (Fipronil) devastated
Louisiana's 2000 and 2001 crawfish crop after its introduction on the
rice seed in 1999. In 2000, Louisiana's crawfish production dropped
from 41 million pounds to 16 million pounds.
Although ICON's purpose is to kill the water weevil, the enemy of the
rice crop, farmers and experts testified at the class certification
trial that it also kills crawfish. Although Aventis (AVE) and the seed
distributor defendants contend that ICON is safe, studies conducted by
aquaculture experts and the LSU AgCenter proved otherwise. Once ICON-
coated rice seeds are planted in the fields, ICON contaminates the
water and sediment in which the crawfish feed. Scientists say ICON and
its degradates will remain in the sediment and may continue to cause
damage to crawfish production for many years to come.
Aventis appealed the original class action certification ruling, but
the judgment was upheld by both the Third Circuit Court of Appeal last
year and by the Louisiana Supreme Court in February of this year.
Other rulings handed down by Judge Genovese this week the case included
a denial of Aventis' motion to require crawfish farmers to complete
claim forms or questionnaires at this stage of litigation and approval
of the notice plan submitted by the attorney's representing the
crawfish farmers. Judge Genovese also ruled that only class
representative claims will be tried in March. Opelousas attorney Pat
Morrow, one of the lawyers representing the farmers, says notices can
now be sent to all potential class action participants announcing that
the class has been certified.
For more details, contact attorneys Patrick Morrow by Phone:
1-800-356-6776, Dawn M. Barrios by Phone: 1-888-771-0788 or the Hunter
Lundy Law Firm by Phone: 1-800-259-1005.
LOUISIANA-PACIFIC: CA Court Dismisses Two Consumer Suit Claims
--------------------------------------------------------------
The Superior Court of California for Stanislaus County dismissed
several claims in the class action filed against Louisiana-Pacific
Corporation on behalf of a class of persons owning structures on which
Nature Guard Fiber Cement Shakes were installed as roofing.
NatureGuard cement fiber roof shakes were manufactured by the Company
in a single-line California mill from 1995 to 1998. The suit asserts
claims for breach of express and implied warranties, unfair business
practices, and violation of the Consumer Legal Remedies Act and seeks
general, compensatory, special and punitive damages, disgorgement of
profits and the establishment of a fund to provide restitution to the
purported class members.
The court dismissed plaintiffs' claims for breach of implied warranty
and violation of the Consumer Legal Remedies Act. The Company no
longer manufactures or sells fiber cement shakes. The Company believes
that it has substantial defenses to the suit.
LOUISIANA-PACIFIC: Dismissed By OR Court From ERISA Fraud Lawsuit
-----------------------------------------------------------------
The United States District Court for the District of Oregon dismissed
Louisiana-Pacific Corporation as a defendant in a class action filed on
behalf of a purported class of persons who are participants and
beneficiaries of the Louisiana-Pacific Corporation Hourly and Salaried
401(k) and Profit Sharing Plans.
Plaintiffs generally allege breaches of fiduciary duty and violations
of disclosure requirements and obligations under the Employee
Retirement Income Security Act (ERISA) in relation to investments in
our common stock acquired or held through the Plan. Plaintiffs seek
compensatory damages, equitable and injunctive relief and a declaration
that the defendants violated duties, obligations and responsibilities
imposed upon them as fiduciaries and co-fiduciaries and the disclosure
requirements under ERISA.
On April 25, 2003, the Company was dismissed from this action so only
certain officers and former officers remain defendants in this putative
class action. The Company believes that the allegations are without
merit and intends to defend the matter vigorously. Based upon the
information currently available, the Company believes that the
resolution of this matter will not have a material adverse effect on
its financial position, results of operations, cash flows or liquidity.
MANUFACTURERS SERVICES: Court Dismisses Securities Suit in Part
---------------------------------------------------------------
The United States District Court for the Southern District of New York
dismissed in part the consolidated securities class action filed
against Manufacturers Services, Ltd., certain of its former officers
and the underwriters that participated in the Company's initial public
offering.
The suit alleges violations of federal securities laws. The complaint,
which seeks unspecified damages among other things, alleges that the
prospectus filed by the Company relating to stock sold in its initial
public offering contained false and misleading statements with respect
to the commission arrangements between the underwriters and their
customers.
The Company understands that various other plaintiffs have filed
substantially similar class action cases against approximately 300
other publicly traded companies and their IPO underwriters, which cases
have been consolidated to a single federal district court for
coordinated case management.
The Company believes that this claim lacks merit. On July 15, 2002, the
Company together with the other issuers named as defendants in these
coordinated proceedings filed a collective motion to dismiss the
consolidated complaints against them on various legal grounds. On
October 9, 2002, the court approved a stipulation between the
plaintiffs and the individual defendants providing for the dismissal of
the individual defendants without prejudice.
In February 2003, that motion was denied with respect to most issuers,
including the Company. While the Company can make no assurances
regarding the outcome of this action, the Company believes that the
final result will have no material effect on its consolidated financial
condition or result of operations.
In addition, the Company is from time to time subject to legal
proceedings and claims which arise in the normal course of its
business. In the opinion of management, the amount of ultimate
liability with respect to these actions will not have a material
adverse effect on the Company's financial position or its results of
operations.
MARVELL TECHNOLOGY: Court Partially Dismisses Securities Lawsuit
----------------------------------------------------------------
The United States District Court for the Southern District of New York
dismissed in part the consolidated securities class action filed
against the Company, certain of its officers and directors and two
investment banks that participated in the underwriting of Marvell
Technology Group's initial public offering (IPO) on June 29, 2000.
That lawsuit alleges that the underwriters received "excessive" and
undisclosed commissions and entered into unlawful "tie-in" agreements
with certain of their clients in violation of Section 10(b) of the
Securities Exchange Act of 1934.
The suit relating to the Company's IPO has been consolidated with
hundreds of other lawsuits filed by plaintiffs against approximately 40
underwriters and approximately 300 issuers across the United States.
Defendants in the consolidated proceedings moved to dismiss the
actions.
In February 2003, the trial court issued its ruling on the motions,
granting the motions in part, and denying them in part. Thus,
the cases may proceed against the underwriters and the Company as to
alleged violations of section 11 of the Securities Act of 1933
and section 10(b) of the Securities Exchange Act of 1934. Claims
against the individual officers have been voluntarily dismissed with
prejudice by agreement with plaintiffs.
These claims and any resulting litigation could result in substantial
costs and could divert the attention and resources of the Company's
management.
MCLEODUSA INC.: Hearing on Motion To Dismiss Stock Suit Starts
--------------------------------------------------------------
McLeodUSA, Inc. asked the United States District Court in Iowa to
dismiss a securities class action filed against it and its officers,
alleging they misled investors about the company's financial
performance, the Tribune Business News reports. The suit names as
defendants the Company, former Chairman and co-CEO Clark McLeod,
current Chairman and CEO Chris A. Davis, current President Stephen
Gray, and former chief financial and accounting officer Lyle Patrick.
Judge Linda Reade must decide whether to dismiss the case, after
listening to arguments for both sides. Arguing for dismissal, Richard
Werder Jr. of Cleveland law firm Jones Day dismissed the suit as
`hopelessly vague" and said others were classic "fraud by hindsight"
allegations. He said there was no evidence that the Company's officers
acted on the basis of self-enrichment.
Lawyers for both sides argued particularly on the most important charge
in the suit - that the Company routinely backdated contracts and booked
non-existent orders to meet revenue forecasts. Mr. Werder said claims
in the lawsuit were attributed to unnamed sales personnel who might
have been motivated to earn higher commissions by manipulating the
company's accounting system. Their unattributed statements were not
sufficient to make a case for securities fraud, he said, the Tribune
Business News states.
However, plaintiffs' attorney Sanford Dumain of the Milberg Weiss law
firm belied defendants' claims that the employees couldn't have known
or must have misunderstood the company's behavior. He asserted that
their positions gave them considerable insight.
The two sides disagree on whether the shareholders should have the
right to amend or refile the case if the judge finds it flawed.
McLeodUSA shares lost about 98 percent of their value in the lawsuit
period and later went through bankruptcy. A series of shareholder
lawsuits were consolidated into one.
MEN'S WEARHOUSE: Trial in Consumer Fraud Suit Set May 2003 in CA
----------------------------------------------------------------
Trial in the class action filed against The Men's Wearhouse, Inc. is
tentatively set for May 19,2003 in the Superior Court of California for
the County of San Diego.
The suit alleges several causes of action, each based on the factual
allegation that the Company advertised and sold men's slacks at a
marked price that was exclusive of a hemming fee for the pants. The
suit seeks:
(1) permanent and preliminary injunctions against advertising
slacks at prices which do not include hemming;
(2) restitution of all funds allegedly acquired by means of any
act or practice declared by the Court to be unlawful or
fraudulent or to constitute unfair competition under certain
California statutes;
(3) prejudgment interest;
(4) compensatory and punitive damages;
(4) attorney's fees; and
(6) costs of suit.
The Company believes that the San Diego County Suit is without merit
and the allegations are contrary to customary and well-recognized and
accepted practices in the sale of men's tailored clothing. The suit
was subsequently amended to add similar causes of action and requests
for relief based upon allegations that the Company's alleged "claims
that (it) sell(s) the same garments as department stores at 20% to 30%
less" are false and misleading. The Company believes that such added
causes of action are also without merit.
The court ruled against the plaintiff's motion for class certification,
declining to certify a class. On October 17, 2002, the court granted
summary adjudication in favor of the Company on the plaintiff's false
advertising claim on behalf of the general public relating to hemming
fees, and also reaffirmed its earlier ruling denying class
certification. The court found there were try-able issues of fact, and
therefore denied summary adjudication on the remaining claims. The
Company intends to vigorously defend the suit.
MEN'S WEARHOUSE: Employees Launch Two Lawsuits Over Overtime Wage
-----------------------------------------------------------------
The Men's Wearhouse, Inc. faces two class actions filed in the Superior
Court of California for the County of Orange, and the Los Angeles
Superior Court in California. The Los Angeles suit also names as
defendants two of the Company's subsidiaries K&G Men's Center, Inc. and
K&G Men's Company Inc.
The suits, which were both brought as purported class actions, allege
several causes of action, each based on the factual allegation that in
the State of California the Company and K&G misclassified its managers
and assistant managers as exempt from the application of certain
California labor statutes. Because of this misclassification, the
suits allege that the Company and K&G failed to pay overtime
compensation and provide the required rest periods to such employees.
The suits seek, among other things, declaratory and injunctive relief
along with an accounting as to alleged wages, premium pay, penalties,
interest and restitution allegedly due the class defendants.
The Company believes that its managers and assistant managers were
properly classified as exempt under such statutes and, therefore,
properly compensated. The Company believes that the suits are without
merit and intends to vigorously defend them.
MICROSOFT CORPORATION: Reaches Settlement in MT Antitrust Suit
--------------------------------------------------------------
Montana consumers, and Microsoft Corporation jointly announced today
that a settlement has been reached in a class action alleging that
Microsoft Corporation violated Montana's antitrust and unfair
competition laws.
The settlement, which received preliminary approval from the Montana
First District Court on March 25, will provide up to $12.3 million to
class members in the form of vouchers that may be used to buy any
manufacturer's desktop, laptop and tablet computers, any software used
with those computer products, and specified peripheral devices for use
with computers.
Microsoft will donate one-half of any unclaimed settlement proceeds to
Montana's most needy public schools in the form of vouchers that may be
used to purchase a broad range of hardware products, Microsoft(R) and
non-Microsoft software, and professional development services. The
company estimates that 325 schools, serving more than 38,325 students,
will be eligible to receive assistance. This represents nearly one
quarter of all Montana students.
Mike Meloy, attorney for the plaintiffs, said, "This settlement
benefits Montana consumers, businesses and schools. We are proud to
have achieved this result."
"I am delighted that a significant portion of Microsoft settlement will
directly benefit Montana school children," said Linda McCulloch, state
superintendent of the Montana Office of Public Instruction. "All our
schools are facing daunting budget problems. This settlement is most
welcome and will be put to good use in classrooms across Montana."
Bruce Messinger, superintendent of Helena Public Schools, added, "I am
pleased the Microsoft settlement will be used to provide technology
products to promote learning in Montana schools. I am especially
impressed that resources from the settlement can be used to pay for
professional development for Montana teachers and enrich the learning
environment through the use of appropriate technology."
"We're pleased by the opportunity to help schools all across Montana
get the computers and software they need," said Brad Smith general
counsel for Microsoft. "This settlement allows us to focus on the
future and building great software, and avoids the cost and uncertainty
of litigation."
Details of the settlement are set forth in a settlement agreement filed
in the Montana First District Court, Lewis and Clark County. Under the
settlement, consumers who purchased Microsoft operating system,
productivity suite, spreadsheet or word processing software between
March 28, 1996, and August 31, 2002, for use in Montana will be
eligible to apply for the vouchers.
For more details, contact Jim Desler of Microsoft by Phone:
1-425-703-6061 or by E-mail: jdesler@microsoft.com or contact the Rapid
Response Team, Waggener Edstrom by Phone: 1-503-443-7070 or by E-mail:
rrt@wagged.com
NATURE'S YOUTH: Completes Recall of Supplement Over False Claims
----------------------------------------------------------------
Nature's Youth, LLC, of Centerville, Massachusetts, completed its
voluntarily destruction of approximately 5700 boxes (each containing a
30-day supply) of its misbranded product, "Nature's Youth hGH." This
destruction, which occurred at locations in Massachusetts and Florida,
was recently completed and involved approximately $515,000 worth of
product. The firm also indicated it would change the labeling for
future marketing of the product in order to comply with the law.
"The FDA is committed to help consumers make health and dietary choices
based on accurate information," said FDA Commissioner Mark McClellan,
M.D., Ph.D. "The FDA will continue to take strong action to protect
American consumers from dietary supplements that are not accurately
labeled or that make misleading claims unsupported by scientific
evidence."
The FDA determined the product was misbranded after evaluating
unsubstantiated "structure and function" claims made on the company's
website, as well as a review of the labeling of the product line.
Among the false and misleading claims was that Nature's Youth hGH was a
"proprietary blend of amino acids and precursor nutrients which enhance
the body's natural production of Human Growth Factors and Insulin-like
Growth Factor-1" that would, among other things, "improve physical
performance, speed recovery from training, increase cardiac output, and
increase immune functions." The product also claimed to be "your
body's best defense against aging."
In this case, the company claimed that an article in the New England
Journal of Medicine (Volume 323:1-6, Number 1, July 5, 1990) provided
substantiation for their claim. However, the New England Journal of
Medicine (Volume 348:777-778, Number 9, February 27, 2003) included a
clear statement that such a claim was misleading. The editor-in-chief
wrote in part, "If people are induced to buy a 'human growth hormone
releaser' on the basis of research published in the Journal, they are
being misled."
FDA will continue to monitor the marketplace to ensure that products
purporting to be dietary supplements are labeled properly and that
claims being made for these types of products are not false or
misleading.
For more details, contact the US Food and Drug Administration by Phone:
888-INFO-FDA
NEW JERSEY: Car Dealers Face Consumer Lawsuit Over Extra Charges
----------------------------------------------------------------
Several New Jersey dealers face a class action filed in Bergen County
State Court, alleging they overcharged customers for registering
vehicles and for other services, the Record reports. More than 100
plaintiffs are alleging overcharges at more than 90 dealerships, said
Ridgewood attorney Don MacLachlan. He said he suspects many more do
the same.
"There are potentially hundreds of thousands of consumers throughout
the state who have overpaid for registration and document fees," Mr.
MacLachlan told the Record. "They were taken advantage of, and
fairness dictates that they be paid back the money that's owed them."
The suit states that the dealers charge consumers for a title and to
register vehicles with the state Department of Motor Vehicles, as well
as a separate general fee for processing various documents. The suit
asserts that dealers misled customers to believe only the dealership
could get the registration and the title for their vehicles, when
buyers can obtain a title and registration on their own.
A similar case was filed in 1999 against Oasis Ford of Old Bridge. The
suit ended with Oasis agreeing to refund 17,500 customers with a coupon
that had a cash value of $60 or a value of $250 if used at the
dealership, according to court documents.
In recent years, New Jersey's Division of Consumer Affairs has accused
several individual dealers of overcharging for title and registration
fees, Genene Morris, the division's spokesperson told the Record.
"This is something we are aware of and have been pursuing," Mr. Morris
said.
However, auto dealers questioned the motives behind the suit, saying
they followed strict state regulations in setting fees. "If they have
found evidence of dealers not playing by the rules, everybody wants to
address that," Jim Appleton, president of the New Jersey Coalition of
Automotive Retailers told the Record. "But if they are trying to
exploit the legal system to churn out legal fees, that's different.
"In a lot of these lawsuits, that's what it's about: legal fees."
OREGON: Inmates Commence Lawsuit Over Treatment For Hepatitis C
---------------------------------------------------------------
Oregon inmates allege in a pending class action that treatment for
Hepatitis C is inadequate in the state's 12-prison, 11,800-inmate
system that it violates the constitutional ban on cruel and unusual
punishment, according to a report by Associated Press Newswires.
The federal lawsuit seeks $17.5 million for inmate medical expenses,
including drug therapy, chemotherapy and potential liver transplants.
Prisoners allege that health care managers systematically deny
treatment to hold down the costs. Prisoners and advocates both
maintain that a prison sentence can turn into a death sentence for
infected inmates.
Portland lawyer Michelle Burrows filed the lawsuit on behalf of 11
current and former inmates. District Court Judge Anna Brown recently
granted Ms. Burrows' motion that the lawsuit be expanded into a class
action. As a result, all Oregon inmates with hepatitis C now are
considered plaintiffs.
Responding in an affidavit to the inmates' lawsuit, Dr. Steven Shelton,
the Corrections Department's medical director, described the overall
approach to inmates' treatment for hepatitis C treatment as "medically
reasonable, consistent, albeit conservative." Lynne Rennick, an
assistant state attorney general representing the Corrections
Department in the case, says in court papers that a conservative
approach makes sense because most people infected with hepatitis C
never develop serious health problems.
It is not only in Oregon that the debate over hepatitis C treatment for
inmates is taking place. Corrections officials and inmates around the
country are battling over hepatitis C in a debate that centers on the
cost and effectiveness of drug therapy for tens of thousands of
infected inmates.
Some experts say treatment clears the virus in half the cases. "If you
take this long course of treatment with both the drugs used for
treatment, you have a 50-50 chance of getting rid of the virus, said
Paul Cieslak, manager of the communicable disease program for the
Oregon Department of human services. Mr. Cieslak estimated that
roughly 10 percent of Oregon prisoners with hepatitis C have liver
damage serious enough to warrant treatment.
Another source of concern voiced in the debate is that without expanded
treatment and education about the risks of hepatitis, freed prisoners
will contribute to a wave of infections in the outside world.
Hepatitis C disproportionately affects prisoners, prompting some
experts to say that prisons and jails essentially act as "incubators"
for the disease. This is because the virus is spread by sharing IV
drug needles, by unprotected sex, use of unsanitary equipment used for
tattooing and body piercing, by using contaminated razors, scissors or
toothbrushes.
In Oregon, correction officials estimate costs of treatment range from
$18,000 to $30,000 per inmate.
ORKIN EXTERMINATING: Consumers Sue For Fraudulent Wood Treatments
-----------------------------------------------------------------
Owners of the Coachman Crossing Apartments, in Tampa, Florida, are
suing Orkin for $6.7 million in a lawsuit that goes to trial this week,
Associated Press Newswires reports. The lawsuit accuses the company of
leaving the apartment house owners and residents vulnerable to termites
by "permitting" their employees to fake wood treatments and
reinspections. This lawsuit is one of several such lawsuits, filed
throughout the southeastern United States, making similar allegations
against Orkin.
This week's trial in the Coachman Crossing suit, will serve as a test
case for those other lawsuits, because Circuit Judge Claudia Isom is
allowing introduction of testimony from former Orkin workers that
forging reinspection tickets and not performing treatments was a
widespread practice.
"It is the same pattern and practice of business that Orkin has
conducted all through the state of Florida," said Daniel Clark,
plaintiffs' attorney.
In depositions taken in the case, the former Orkin employees have said
there was too much work to get done, and managers were under pressure
to post big earnings and performance numbers for the company. The
practice was no secret within Orkin; a study of the lawsuit's court
records includes company documents in which managers were warning of
forgery, theft and fraud.
PEP BOYS: To Ask Court To Reconsider Overtime Suit Certification
----------------------------------------------------------------
The Pep Boys - Manny Moe & Jack intend to ask the California Superior
Court in Orange County to reconsider its decision certifying as a class
action the suit filed on behalf of its former and current store
management employees who claim that they were improperly classified as
exempt from the overtime provisions of California law and seek to be
compensated for all overtime hours worked.
Plaintiffs filed a motion to certify the case as a class action to
represent all persons employed in California as salaried store
managers, assistant store managers, service managers and assistant
service managers since March 29, 1996. The motion was granted
by the trial court. The Company's appeals of that decision through the
California Supreme Court was unsuccessful.
No trial date has been set for the underlying case. The Company
intends to vigorously defend this action and believes that it is not
material to the Company's financial position. An adverse outcome in
this action, however, may have a material adverse effect on the
Company's results of operations for the year in which a judgment, if
any, is rendered.
QUINTILES TRANSNATIONAL: NC Securities Suits Ordered Consolidated
-----------------------------------------------------------------
The North Carolina Business Court upheld the case management order in
seven purported class actions filed against Quintiles Transnational
Corporation by shareholders seeking to enjoin the consummation of a
transaction proposed by Pharma Services Company, a newly formed company
wholly owned by Dennis B. Gillings, Ph.D., to acquire all the Company's
outstanding shares for $11.25 per share in cash. The lawsuits name as
defendants Dr. Gillings, other members of the Company's Board of
Directors, the Company and, in some cases Pharma Services Company.
The complaints allege, among other things, that the directors breached
their fiduciary duties with respect to the proposal. The complaints
seek to enjoin the transaction proposed by Pharma Services Company, and
the plaintiffs seek to recover damages. On November 11, 2002, a
Special Committee of the Company's Board of Directors announced its
rejection of the proposal by Pharma Services Company and its intention
to investigate strategic alternatives available to the Company for
purposes of enhancing shareholder value, including the possibility of a
sale of the Company and alternatives that would keep the Company
independent and publicly owned.
On January 6, 2003, the court entered a Case Management Order
consolidating all seven lawsuits for all purposes and staying the
lawsuits until March 29, 2003 or until the Company provides notice of a
change-of-control transaction involving the Company.
On March 28, 2003, the Court entered an Order Maintaining the Status
Quo, which continued its prior Case Management Order in all respects
until the earlier of a date selected by the Court or until the Company
provides the notice contemplated by the Case Management Order. On
April 10, 2003, the Company's Board of Directors approved a merger
agreement with Pharma Services Holding, Inc. for the Company's public
shareholders to receive $14.50 per share in cash.
The Company anticipates filing a proxy statement and holding a special
meeting later this year at which the shareholders will vote on the
transaction. Under the terms of the Case Management Order, the Company
is required to give Plaintiff's counsel and Court notice of a change-
of-control transaction involving the Company at least forty (40) days
prior to the closing of such a transaction. Plaintiffs are required to
serve an amended consolidated complaint within thirty (30) calendar
days of the notice. The Company believes the original lawsuits are
without merit and intends to defend these claims vigorously. The scope
or substance of any new or additional claims that might be asserted by
Plaintiffs in the pending litigation, or through independent actions by
Plaintiffs or any other shareholder, cannot be determined with
certainty at this time, but it is possible that such claims could seek
to challenge the fairness or adequacy of any transaction announced by
the Company, including the proposed transaction with Pharma Services
Holding, or the process employed by the Company or the Special
Committee, or seek to enjoin it.
In the event that plaintiffs elect to file any amended complaint, or in
the event that any new litigation is filed, the Company will evaluate
those claims and respond as appropriate.
RITE-AID CORPORATION: Fairness Hearing For Settlement Set May 2003
------------------------------------------------------------------
Fairness hearing for the final approval of the settlement of a
consolidated securities class action filed against Rite-Aid Corporation
is set for May 30,2003 in the United States District Court for the
Eastern District of New York.
The suit was filed on behalf of security holders who purchased the
Company's securities on the open market between May 2, 1997 and
November 10, 1999. The suit was based on the allegation that the
Company's financial statements for fiscal 1997, fiscal 1998 and fiscal
1999 fraudulently misrepresented the Company's financial position and
results of operations for these periods.
The parties in the suit later negotiated a settlement, which was
approved by the court. Although that order was appealed by certain
non-settling defendants (including the Company's former auditor, KPMG,
its former chief executive officer, Martin Grass, and its former chief
financial officer, Frank Bergonzi), those non-settling defendants have
now also settled with plaintiffs and have agreed to dismiss their
appeal.
In accordance with the agreement settling plaintiffs' claims against
the Company, in April 2002, the Company issued $149.5 million of senior
secured (shareholder) notes (subsequently redeemed in February 2003)
and paid $45.0 million in cash, which was fully funded by its officers'
and directors' liability insurance.
If the settlement does not become final, this litigation could result
in a material adverse effect on the Company's results of operations,
financial condition or cash flows. Several members of the class have
elected to "opt-out" of the class and, as a result, they will be free
to pursue their claims. Management believes that their claims,
individually and in the aggregate, are not material.
RITE-AID CORPORATION: Plaintiffs Appeal Securities Suit Dismissal
-----------------------------------------------------------------
Plaintiffs in the class action filed against Rite-Aid Corporation
appealed the dismissal of the suit by the Delaware state court. The
suit was filed on behalf of stockholders who purchased shares of the
Company's common stock prior to March 1, 1997, and who continued to
hold them after October 18, 1999. The amount of damages sought was not
specified and may be material.
The Company filed a motion to dismiss this complaint for failure to
state a claim for which relief could be granted. The court later
dismissed the class action and breach of fiduciary duty claims with
prejudice and the individual claims without prejudice.
SEDONA CORPORATION: Launches Securities Fraud Lawsuit in S.D. NY
----------------------------------------------------------------
SEDONA Corporation (OTCBB:SDNA) filed a civil action lawsuit against
numerous defendants in the United States District Court, Southern
District of New York, seeking damages from the defendants named, and
other defendants yet to be named, in the complaint for:
(1) allegedly participating in the manipulation of its common
stock,
(2) fraud,
(3) misrepresentation,
(4) failure to exercise fiduciary responsibility,
(5) failure to adhere to SEC trading rules and regulations,
(6) tortuous interference,
(7) conspiracy and
(8) other actions set forth in the complaint, including, but not
limited to enforcement of settlement date and affirmative
determination
In September of 2001, SEDONA came into possession of a report alleging
manipulation of over sixty publicly traded companies, one of which was
SEDONA. After reviewing the report and its own trading history, the
Company requested the Security and Exchange Commission investigate the
trading of its stock. On February 27, 2003, the SEC, in Litigation
Release No. 18003, announced a settled civil action in the Southern
District of New York against certain parties accused of manipulating
SEDONA stock, and made public its' complaint detailing their
allegations.
In addition to alleged violation of the Commission's Order Lawfully
Issued pursuant to Section 21 (a) of the Exchange Act, the SEC
complaint details alleged violations of Section 10 (b) of the Exchange
Act and Rule 10-b5, along with alleged violations of Section 17 (a)(1)
of the Securities Act.
Marco Emrich, President and CEO of SEDONA, commented, "In October of
2001, we took action that we felt was necessary to protect our
shareholders and the future of our company. At that time, SEDONA
placed a request and its faith in the SEC and other regulatory agencies
to investigate this alleged manipulation. By their recent actions, the
SEC has spoken very clearly, and their efforts are much appreciated.
Now it is our responsibility to act upon that information for the
protection of our shareholders. Our suit seeks to recover the
tremendous damage that, in our opinion, has been done to our
shareholders, and to our efforts to build SEDONA."
Mr. Emrich continued, "It is the right of our shareholders, and the
right of shareholders of all public companies, to expect the price of
the shares they own to be determined by supply and demand, rather than
an alleged manipulative and fraudulent trading scheme."
James W. Christian, of Christian, Smith & Jewell commented, "In our
opinion, we continue to see more and more occasions of small companies
seeking capital to implement their business plans falling prey to
predatory financing. It is our opinion that SEDONA is a prime example
of this alleged illegal behavior. It is also our opinion that while
seeking to build a sound business with a planned quality capital
formation program, SEDONA instead was led into a maze of (i) its own
financial advisor placing SEDONA with toxic funders, and (ii)
manipulative short selling from hedge funds, fund managers, offshore
funds, and broker-dealers, all of whom allegedly profit from their
destruction, no matter how many employees, customers, and shareholders
they left in their wake. The difficulty in capital formation and
building a business, while a company's stock is continually manipulated
downward, has, in our opinion, resulted in many good young companies
disappearing. With the aggressive manipulation designed to bankrupt
the 'victimized' companies, it is a testimony to SEDONA's business
plan, products, and people, that SEDONA is still here today."
Mr. Christian concluded, "It is further our opinion that this is a
widespread problem in the financial markets today. The small start-up
company is the foundation for many workers, and technological
advancements, which are vital to economic growth. Predatory financing
of companies threatens to destroy that backbone. Just because you are
a small-cap company doesn't mean you are not entitled to the same
protections from naked short selling as any Fortune 500 company. We
seek to repair the damages done to SEDONA, and to attempt to prevent
this type of behavior in the future."
Meetings, Conferences & Seminars
* Scheduled Events for Class Action Professionals
-------------------------------------------------
May 7-8, 2003
MANAGING MOLD LIABILITIES
Bridgeport Continuing Education
San Francisco
Contact: 818-505-1490
May 10, 2003
2003 CRITICAL ISSUES IN EMPLOYMENT LITIGATION
Continuing Education of the Bar
Wilshire Grand Hotel & Centre, Los Angeles, CA
Contact: 1-800-232-3444; http://www.ceb.com
May 14-15, 2003
CALIFORNIA ENVIRONMENTAL UPDATE
Bridgeport Continuing Education
San Jose
Contact: 818-505-1490
May 15-16, 2003
D&O LIABILITY INSURANCE
American Conference Institute
TriBeCa Grand Hotel, New York
Contact: 1-888-224-2480; http://www.americanconference.com
May 17, 2003
2003 CRITICAL ISSUES IN EMPLOYMENT LITIGATION
Continuing Education of the Bar
Red Lion Hotel, Sacramento, CA
Contact: 1-800-232-3444; http://www.ceb.com
May 17, 2003
LEGENDS OF LITIGATION: THE ART OF EXAMINATION
Continuing Education of the Bar
Red Lion Hotel, Sacramento, CA
Contact: 1-800-232-3444; http://www.ceb.com
May 20, 2003
FEN-PHEN LITIGATION CONFERENCE
Mealey Publications
The Ritz-Carlton Hotel, Philadelphia
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
May 31, 2003
2003 CRITICAL ISSUES IN EMPLOYMENT LITIGATION
Continuing Education of the Bar
Crowne Plaza Hotel, San Francisco, CA
Contact: 1-800-232-3444; http://www.ceb.com
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 7, 2003
USING MEDITATION TO RESOLVE MOLD CLAIMS - AN ATTORNEYS GUIDE
BridgeportCE
Omni Los Angeles Hotel
Contact: 1-818-505-1490; www.reconferences.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
ARSENIC AND CCA-TREATED 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 16-17, 2003
MANAGING MOLD LIABILITIES
Bridgeport Continuing Education
San Francisco
Contact: 818-505-1490
June 19-20, 2003
SECURITIES, DRUGS & ENVIRONMENTAL LITIGATION
MassTortsMadePerfect.Com
Chicago
Contact: 1-800-320-2227; register@masstortsmadeperfect.com
June 24-25, 2003
SECURITIES CLASS ACTIONS
American Conference Institute
Crowne Plaza Times Square, New York
Contact: 1-888-224-2480; http://www.americanconference.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
July 15, 2003
LEXISNEXIS PRESENTS: WALL STREET FORUM: MASS TORT LITIGATION
Mealey Publications
The Ritz-Carlton Hotel, Battery Park, New York
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
July 31-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.
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 8-9, 2003
NATIONAL ASBESTOS LITIGATION CONFERENCE
Mealey Publications
The Ritz-Carlton Hotel Chicago
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
September 15-16, 2003
SECURITIES LITIGATION & ENFORCEMENT 2003
Practising Law Institute
PLI New York Center
Contact: 800-260-4PLI; info@pli.edu.
September 19-21, 2003
THE 20TH TOBACCO PRODUCTS LIABILITY PROJECT CONFERENCE
Northeastern University School of Law
Contact: scuri@tplp.org
September 22-23, 2003
BAD FAITH CONFERENCE
Mealey Publications
The Westin Hotel, Philadelphia
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
October 2-3, 2003
SECURITIES LITIGATION & ENFORCEMENT 2003
Practising Law Institute
PLI New York Center
Contact: 800-260-4PLI; info@pli.edu.
November 6-7, 2003
SECURITIES, DRUGS & ENVIRONMENTAL LITIGATION
MassTortsMadePerfect.Com
Ritz Carlton, New Orleans, Louisiana
Contact: 1-800-320-2227; register@masstortsmadeperfect.com
November 13-14, 2003
ASBESTOS LITIGATION IN THE 21ST CENTURY
ALI-ABA
New Orleans
Contact: 215-243-1614; 800-CLE-NEWS x1614
November 17, 2003
Water Contamination Litigation Conference
Mealey Publications
Pasadena
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
March 18-19, 2004
SECURITIES, DRUGS & ENVIRONMENTAL LITIGATION
MassTortsMadePerfect.Com
The Fairmont, San Francisco, California
Contact: 1-800-320-2227; register@masstortsmadeperfect.com
June 10 & 11, 2004
SECURITIES, DRUGS & ENVIRONMENTAL LITIGATION
MassTortsMadePerfect.Com
Atlantis, Paradise Island, Bahamas
Contact: 1-800-320-2227; register@masstortsmadeperfect.com
TBA
Fair Labor Standards Conference
Mealey Publications
Contact: 1-800-MEALEYS; 610-768-7800; mealeyseminars@lexisnexis.com
* Online Teleconferences
------------------------
May 08-10, 2003
EMPLOYMENT DISCRIMINATION & CIVIL RIGHTS ACTIONS IN
FEDERAL AND STATE COURTS
ABA-CLE
Contact: 800-285-2221; abacle@abanet.org
May 14, 2003
CLASS ACTION BASICS
ABA-CLE
Contact: 800-285-2221; abacle@abanet.org
ADVERSARIAL PROCEEDINGS IN ASBESTOS BANKRUPTCIES
LawCommerce.Com/Mealey's
Online Streaming Video
Contact: customerservice@lawcommerce.com
ASBESTOS BANKRUPTCY - PANEL OF CREDITORS COMMITTEE MEMBERS
LawCommerce.Com/Mealey's
Online Streaming Video
Contact: customerservice@lawcommerce.com
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 ASBESTOS 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
PHARMACIA CORPORATION: Marc Henzel Lodges Securities Suit in NJ
---------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the District of New Jersey on
behalf of all purchasers of the common stock of Pharmacia Corporation
(NYSE: PHA) from April 17, 2000 through August 22, 2001, inclusive.
The complaint charges Pharmacia Corporation and certain of its officers
and directors with violations of the Securities and Exchange Act of
1934. Specifically, the complaint alleges that Pharmacia marketed
Celebrex as a new type of drug that, unlike aspirin or ibuprofen,
retarded pain and inflammation without the adverse side effects of
ulcers or gastrointestinal bleeding.
During the class period, Pharmacia and its partner Pfizer, who funded
the study, trumpeted the results of the ``Celecoxib Long-term Arthritis
Safety Study'' (the ``CLASS'' study) -- a clinical study to compare the
gastrointestinal problems of patients who used Celebrex to those of
patients who used other Nonsteroidal Anti-inflammatory Drugs (NSAIDs) -
- which found that Celebrex caused fewer gastrointestinal problems than
traditional drugs, such as ibuprofen.
Given all the hype surrounding the CLASS study, the Journal of the
American Medical Association (JAMA) published a study by the Company
that showed that Celebrex caused fewer gastrointestinal problems than
traditional drugs. Unbeknownst, however, to JAMA, the study was flawed
because the Company manipulated the results in such a way to show that
Celebrex was safer for the stomach and digestive tract than
conventional drugs by not including in the final analysis all of the
data collected through the entire duration of the study, which
concluded opposite to the Company's findings.
During the class period, the Company failed to make adequate
disclosures concerning this study and used this fallacious study in
their continuing efforts to have the Food and Drug Administration
remove the warning label from Celebrex. During the class period, the
Company continued to misrepresent that Celebrex was just as likely to
cause ulcers like older, cheaper medicines until an August 22, 2001
report in The Wall Street Journal shed light on the Company's
fallacious misrepresentations.
On August 22, 2001, The Wall Street Journal reported that reviews,
conducted by researchers from the Cleveland Clinic, of clinical trials
for the arthritis drug Celebrex indicated that the medication might
carry an increased risk for cardiovascular events. They concluded that
heart-attack rates with Celebrex were high enough to be a concern.
The researchers concluded: ``Given the remarkable exposure and
popularity of this new class of medications, we believe that it is
mandatory to conduct a trial specifically assessing cardiovascular risk
and benefit of these agents. Until then, we urge caution in
prescribing these agents to patients at risk for cardiovascular
morbidity.''
Study author Dr. Eric Topol commented in the article that the results
are a ``cautionary flag that seems to say something is going on that
needs further exploration.'' On this news, Pharmacia's stock dropped
below $40 per share.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
SUPERGEN INC.: Marc Henzel Commences Securities Suit in N.D. CA
---------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a securities class action
in the United States District Court for the Northern District of
California on behalf of purchasers of SuperGen Inc. (NASDAQ: SUPG)
common stock during the period between April 18, 2000 and March 13,
2003.
The complaint charges SuperGen and its chairman, president and chief
executive officer with violations of the Securities Exchange Act of
1934. SuperGen is a pharmaceutical company dedicated to the
development and commercialization of products intended to treat life-
threatening diseases, particularly cancer and blood cell disorders, as
well as other serious conditions such as obesity and diabetes.
The complaint alleges that during the class period, one of the
Company's leading drug candidates was Mitozytrex, a proprietary
reformulation of the approved anticancer drug Mitomycin C, which is
used primarily to treat gastric and pancreatic cancers. SuperGen's
reformulation is based on technology designed to improve the handling
characteristics and safety profile of mitomycin and other anticancer
drugs by enhancing the drug's stability in solution form and
"shielding" it at the injection site.
SuperGen sold millions of shares and notes for $25 million in proceeds
so as to provide it with ample monies to fund its operations. However,
this all took place prior to revelations concerning the veracity of the
Company's statements regarding Mitozytrex. The Federal Food, Drug and
Cosmetic Act gives the FDA authority to disseminate information to the
public regarding drugs and other products within the FDA's jurisdiction
to address imminent health dangers or gross deception. To protect the
public health due to the improper statements by the Company, the FDA
notified the public that SuperGen's product, Mitozytrex, has not been
found by the agency to have benefits that the Company claimed.
The truth, actually known by each defendant entailed:
(1) That Mitozytrex caused adverse reactions such as fever,
anorexia, nausea and vomiting, together with myelosuppression
and hemolytic uremic syndrome;
(2) That Mitozytrex was merely a bioequivalent to the innovator
mitomycin. It differed from the innovator formulation only in
that the Company's product contained hydroxypropyl-beta-
cyclodextrin (HPCD). No evidence exists to support the
Company's claims that Mitoyztrex is superior to the existing
formulations of mitomycin;
(3) That there is no existing evidence that the addition of HPCD
yields any clinical advantage over the original formulation of
mitomycin;
(4) That SuperGen's "Extra" technology did not shield the drug at
the injection site; and
(5) That the so-called "advantages" of the Company's product,
including increased solubility, stability and shelf-life, were
non-existent.
For more details, contact Marc S. Henzel by Mail: 273 Montgomery Ave.,
Suite 202, Bala Cynwyd, PA 19004 by Phone: 610-660-8000 or 888-643-6735
by Fax: 610-660-8080 by E-Mail: mhenzel182@aol.com or visit the firm's
Website: http://members.aol.com/mhenzel182
*********
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 2003. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
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