/raid1/www/Hosts/bankrupt/CAR_Public/030804.mbx
C L A S S A C T I O N R E P O R T E R
Monday, August 4, 2003, Vol. 5, No. 152
Headlines
BRISTOL BAY: Lawyers Seek $27.7M Fees in Salmon Antitrust Suit
CATHOLIC CHURCH: Attorneys In Sex Abuse Settlement Defend Fees
CERVELO CYCLES: Voluntarily Recalls Bike Forks For Injury Hazard
CLAYTON HOMES: Shareholders Sue To Block Berkshire Hathaway Deal
CRACKER BARREL: 23 Blacks Commence Race Discrimination Lawsuit
e-TELEMATION INC.: TX Attorney General Orders Asset Freeze
EXELON CORPORATION: IL Court Dismisses Securities Fraud Lawsuit
FLORIDA: City Workers Mistakenly Connect Homes to Wastewater
HEDSTROM CORPORATION: Recalls 116T Trampolines for Injury Hazard
IBM CORPORATION: MO Court Rule For Plaintiffs in Age Bias Suit
IDEAL INDUSTRIES: Recalls 122T Voltage Testers for Burn Hazard
INTERNATIONAL PLAYTHINGS: Recalls 5,000 Toys For Choking Hazard
JIM BAKKER: Plaintiffs in Suit Over Theme Park to Receive $6.54
KING PHARMACEUTICALS: Lawyers Vie For Lead Plaintiff Positions
MAGELLAN COMMUNICATIONS: Court Enjoins Execs From SEC Violations
MCI/WORLDCOM: House Asks For Documents on Long Distance Fraud
NEW YORK: Brooklyn Developer Sent To Prison Over Housing Scam
OTG SOFTWARE: Forges Settlement For Consolidated Securities Suit
REUTERS NEWS: Black Employees Launch Racial Discrimination Suit
SERVICES GROUP: WA Court Approves $1.95M Employee Suit Pact
TOBACCO LITIGATION: IL Judges Make Different Rulings In Lawsuits
VISHAY INTERTECHNOLOGY: DE Court Dismisses Siliconix Offer Suit
WAL-MART STORES: Recalls Kiddie Sling Chairs For Choking Hazard
New Securities Fraud Cases
AVATAR HOLDINGS: Charles Piven Files Securities Suit in DE Court
CATALINA MARKETING: Fruchter & Twersky Lodges FL Securities Suit
CATALINA MARKETING: Charles Piven Lodges Securities Suit in FL
CATALINA MARKETING: Schiffrin & Barroway Files FL Stock Lawsuit
CREE INC.: Hoffman & Edelson Launches Securities Suit in M.D. NC
IMPATH INC.: Faruqi & Faruqi Lodges Securities Suit in S.D. NY
IMPATH INC.: Abbey Gardy Lodges Securities Fraud Suit in S.D. NY
IMPATH INC.: Schiffrin & Barroway Launches Securities Suit in NY
IMPATH INC.: Charles Piven Commences Securities Suit in S.D. NY
IMPATH INC.: Milberg Weiss Commences Securities Suit in N.D. CA
IMPATH INC.: Cauley Geller Lodges Securities Lawsuit in S.D. NY
QWEST SOFTWARE: Brodsky & Smith Files Securities Suit in C.D. CA
QWEST SOFTWARE: Charles Piven Lodges Securities Suit in C.D. CA
QWEST SOFTWARE: Milberg Weiss Lodges Securities Suit in C.D. CA
SOLUTIA INC.: Milberg Weiss Launches Securities Suit in N.D. CA
SOLUTIA INC.: Charles Piven Commences Securities Suit in N.D. CA
STELLENT INC.: Cauley Geller Lodges Securities Suit in MN Court
*********
BRISTOL BAY: Lawyers Seek $27.7M Fees in Salmon Antitrust Suit
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Lawyers for both sides in the Bristol Bay salmon antitrust suit
are seeking a combined $27.7 million in fees and expenses, the
Associated Press reports.
About thirty lawyers participated in the suit, which accused
dozens of U.S. and Japanese seafood companies of conspiring to
cheat thousands of commercial fishermen of dockside payments for
their catches in the early 1990s. The trial lasted for four-
months before ending on May 23, 2000, with 12 jurors dismissing
the price fixing charges.
Lawyers for the plaintiffs say they deserve $16.5 million
because they were able to collect a $40 million settlement fund
from several companies prior to or in the early days of the
trial. This settlement fund is now being held in escrow, and is
presumably where the lawyers would get their share of payment.
On the other hand, defense lawyers for the 10 defendant firms
seek $11.2 million for beating the claims that could have wiped
out their seafood industry clients.
Courthouse wrangling over legal fees could take months to
decide. Both sides say the payments they are requesting would
not be enough to compensate for the time and effort they put on
the case which pulled together fishermen, fish processors,
importers, lawyers, economists and interpreters from Oslo to
Tokyo.
Lawyers have sent bills to the Alaska court seeking partial
reimbursement. In a typical filing, Richard Donovan and other
lawyers for Japanese salmon importer Okaya list $3.4 million in
fees at up to $400 per hour; more than $171,000 for interpreters
and translations; nearly $162,000 for travel; and about $61,500
for copies at 10 to 15 cents a page, the Associated Press
reports. The defendant companies also are seeking reimbursement
for more than $1.8 million in shared legal costs, right down to
$3,318 worth of bottled water for people in the courtroom during
the trial.
If Superior Court Judge Peter Michalski grants the two camps of
lawyers their requested sums, it would mean an average payment
of $2,740 to each of the 4,500 current and past commercial
fishermen involved in the class action.
Jack Keane, a veteran Bristol Bay fisherman who lives in
Anchorage, told AP he's not surprised the lawyers might take
much of the money. "The cynics kind of said, 'Well, that's the
way it would go anyways,'" he said. "God, it's a messy legal
thing."
Jeff Feldman, an Anchorage attorney for defendant Trident
Seafoods, told AP that defense lawyers are not looking to put
more money in their own pockets. "We've already been paid," he
said. "It's the defendants themselves, the processors and
importers, who are seeking partial reimbursement for the legal
fees they had to pay."
CATHOLIC CHURCH: Attorneys In Sex Abuse Settlement Defend Fees
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Attorneys for plaintiffs in a $25.4 million clergy-abuse
settlement from the Roman Catholic Archdiocese in Louisville,
Kentucky, defended their negotiations and their fees at a recent
hearing, Associated Press Newswires reports. The hearing was
held in Jefferson County Circuit Court to determine whether the
settlement, to be divided among 243 plaintiffs and their lawyers
is fair.
Lawyers for several plaintiffs have criticized the negotiation
team led by William McMurry of Louisville, saying it did not
adequately represent the plaintiffs' interests. The plaintiffs'
lawyers said the 40 percent fee Mr. McMurry's clients had agreed
to individually - before anyone had known the cases would be
compiled into a class action - was exorbitant.
A group of nine plaintiffs abused by the Rev. Louis Miller
objected to the fee rate. The group said the attorneys' 40-
percent cut of the settlement was "void, unconscionable and, in
any event, inappropriate once the individual cases were combined
and diluted in the class-action context."
Mr. McMurry disagreed, saying he earned the 40 percent fee. He
went into detail about the workload he and his staff took on
during 14 months of litigation. He said he had to hire more
staff to handle the cases of 214 plaintiffs.
Lawyers for the negotiating team asked Circuit Judge James M.
Shake to approve the settlement so it can be disbursed. They
also asked Judge Shake to approve their nomination for an
outside administrator to oversee the disbursal, Cincinnati
lawyer Matthew Garretson. If Judge Shake approves the
appointment, Mr. Garretson would determine how much each
plaintiff would get from the settlement.
Mr. McMurry's team has proposed a five-tier system based on the
degree of abuse each plaintiff suffered from the priests or
employees of the diocese. The smallest amount of money would go
to victims who had been fondled outside their clothing. The
largest amount would go to the most severe cases, which include
rape and sodomy. The victim's age at the time also would be a
factor. The system likely will be altered by a court-appointed
administrator.
One victim attending the hearing, James Bocklage of Louisville,
said the system ought to consider whether the archdiocese could
have done anything to prevent the abuse.
CERVELO CYCLES: Voluntarily Recalls Bike Forks For Injury Hazard
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Cervelo Cycles, Inc. is cooperating with the United States
Consumer Product Safety Commission by voluntarily recalling 317
bicycle forks. The forks on the bicycles can develop cracks
near the crown area resulting in failure of the fork and posing
a risk of injury to the rider.
The recall involves "Wolf" all-carbon road bike forks with a 1-
inch diameter threadless steer tube. The bicycle forks were
sold with 2003 model Soloist Team and Super Prodigy bicycles and
framesets. A 17cm "Cerv‚lo" logo is printed in white outlined
letters on both fork legs.
Bicycle specialty stores sold these items nationwide from April
2003 through July 2003 for about $3,000.
For more information, contact the Company by Phone:
(866) 296-3137 between 9 a.m. and 5 p.m. Monday through Friday
CT or visit the firm's Website: http://www.cervelo.com.
CLAYTON HOMES: Shareholders Sue To Block Berkshire Hathaway Deal
----------------------------------------------------------------
Clayton Homes faces a class action filed in Blount County
Circuit Court in Colorado on behalf of all of its independent
shareholders, relating to its sale to Berkshire Hathaway for
$1.7 billion or $12.50 a share, the Knoxville News Sentinel
reports.
Lawyers for the Denver Area Meat Cutters and Employers Pension
Plan filed an amended suit, seeking class action status, and
asking the court to include all stockholders not affiliated with
the company as plaintiffs in its suit. The suit alleges the
Company's board was motivated to sell by its interest in
providing a market for stock held by the company's chairman, Jim
Clayton, who controls 28 percent of the company's shares, and
continued employment for his son, CEO Kevin Clayton.
The amended suit was filed the day Clayton shareholders approved
the sale. Several shareholders protested the deal, saying the
stock price was too low, but more than 52% of the company's
stock was cast in favor of the deal.
Douglas Johnston Jr., a partner in the Nashville firm Barrett,
Johnston & Parsley, told the News Sentinel, "We're challenging
the deal as a whole, and we're looking at the vote as well. I
don't think we're at liberty to say exactly what we intend to
do, but that's being looked at."
Officials with Clayton Homes could not be reached for comment
Thursday, the Knoxville News Sentinel said. Blount County
Circuit Court Judge Dale Young issued an injunction for the
pension plan Tuesday to prevent Clayton Homes from postponing
Wednesday's vote.
CRACKER BARREL: 23 Blacks Commence Race Discrimination Lawsuit
--------------------------------------------------------------
Twenty-three blacks recently filed a lawsuit against Cracker
Barrel Old Country Store, alleging they received poor service in
comparison to service white patrons received at the company's
restaurants, the Associated Press Newswires reports.
Several of the plaintiffs who visited Cracker Barrels in Bryant
and North Little Rock, both communities in Arkansas, said they
waited in the chain's signature porch rocking chairs while
whites who came later were seated first. They said they were
then seated in a back smoking section, served more slowly than
whites and were openly rebuked when they complained.
"When I talked to the manager, he said if I wasn't satisfied,
there was a Burger King down the street," said the Rev. Henry
Harris. Rev. Harris said the treatment he received reminded him
of discrimination he and his family experienced in the Jim Crow
South more than 40 years ago.
"I lived through the time of whites-only water fountains, and I
don't want to relive it. It took me back to that mentally," he
said.
A Cracker Barrel spokeswoman said the lawsuit was unfounded;
that it was part of an attempt to discredit the Tennessee-based
company.
Plaintiffs' attorney Philip Kaplan said a similar lawsuit filed
last year in Georgia, will show that these were not isolated
incidents, but part of an "insidious" pattern. The lawsuit
seeks monetary damages and revised policies.
Cracker Barrel spokeswoman Julie Davis denied any systematic
discrimination and said the judge in the Georgia case had
endorsed the company's training methods after a thorough
investigation. The same judge ruled in January of this year
that the would-be joint plaintiffs had failed to show a
sufficient pattern of treatment to justify a class action.
The company operates more than 450 Cracker Barrel restaurants
across the nation, offering home style cooking in a country-
store atmosphere.
e-TELEMATION INC.: TX Attorney General Orders Asset Freeze
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A court action ordered the freeze on bank and other assets of US
Credit of Houston and its head corporation e-Telemation Inc,
Texas Attorney General Gregg Abbot announced in a statement.
In addition, the lawsuit filed by the Attorney General cites the
company for the unlawful telemarketing practice of persuading
consumers to disclose private financial information when they
called an advertised toll-free number. The company promised
fast, guaranteed credit card approvals using this information,
none of which transpired. Yet they still debited consumers'
bank accounts to collect "fees." Also named in the lawsuit are
US Credit directors Michael C. Corbell and Robert F. Leaumont
Jr.
"Consumer scams targeting people who need to establish credit
run rampant these days, and I urge unsuspecting consumers not to
disclose any personal financial information just to apply for a
credit card. It's not necessary," said Attorney General Abbott.
"My Consumer Protection office will take pains to expose and
make examples of those who brazenly take someone's money without
providing a single service as advertised."
The company advertised its services in various newspapers and
mail circulars nationwide, soliciting consumers with guaranteed
credit card approvals and $10,000 credit limits via a toll-free
telephone number.
When consumers called this number, company telemarketers would
convince them the quick approval process would be contingent
upon their providing private financial information, such as
checking account numbers and bank routing numbers. If consumers
questioned the need for giving this information, telemarketers
allegedly responded that the company needed a means of verifying
that these callers actually own a bank account, but then assured
them their accounts would not be debited. The company then
allegedly made unauthorized withdrawals of $99 each from these
checking accounts, even from consumers who had decided not to
participate during the initial phone call.
In return for this unlawful account debit, the company then
mailed many consumers what amounted to a credit card kit
consisting of a list of companies and banks with which they
might apply for credit. Consumers never obtained a single
credit card from the company, as advertised.
When these deceived consumers complained that the unlawful
account debits and the credit card kits amounted to unfulfilled
business agreements, company representatives would remind them
that taped phone conversations proved the consumers made
specific agreements. Many telemarketing agents allegedly
laughed at consumers, used profanity or disconnected the calls.
When pressed, the telemarketers described the $99 debit as an
administrative processing fee, and described an additional $9
per month fee, which was undisclosed, as a monthly membership
fee payable for a year. Many consumers had this membership fee
deducted from their checking accounts several times a month.
The telemarketers instructed dissatisfied consumers to return
the mailed kits unopened to the company to get a refund. This
also proved deceptive because consumers later were told that the
company would make only a 75 percent refund, but also require
consumers to show proof of credit denial from at least four
credit card companies.
The Attorney General sued the company for numerous violations of
the Texas Telephone Solicitation Act, the state Finance Code and
the Deceptive Trade Practices Act. The suit seeks to halt these
unlawful activities, and provide for restitution for harmed
consumers, penalties, court costs and attorneys' fees. The
Company also failed to register as a telemarketer or execute a
bond with the Texas Secretary of State, as required.
EXELON CORPORATION: IL Court Dismisses Securities Fraud Lawsuit
---------------------------------------------------------------
The United States District Court in Chicago, Illinois dismissed
with prejudice the consolidated securities class action filed
against Exelon Corporation on behalf of purchasers of its
securities between April 24, 2001 and September 27, 2001.
The suit alleges that Exelon violated federal securities laws by
issuing a series of materially false and misleading statements
relating to its 2001 earnings expectations during the class
period. The suit was later amended to contain allegations of
new facts and several new theories of liability.
On June 13, 2003, the court dismissed the amended complaint with
prejudice. The plaintiffs have agreed not to appeal the court's
order of dismissal, thereby terminating the case.
FLORIDA: City Workers Mistakenly Connect Homes to Wastewater
------------------------------------------------------------
Utility workers in Cape Coral, Florida inadvertently hooked up
four homes to the city's treated wastewater instead of its
purified drinking water, the Associated Press reports.
City officials revealed that one family used the substandard
water for more than three months. Two other homes were hooked
up about a month ago, and a fourth was vacant. The City has
already fixed the lines, although there are lingering health
concerns for the residents.
Ron Kazel, one of the affected residents, only learned this week
that his water had been connected to the irrigation system since
June. He told AP he was "livid" and would not comment on
whether he and his wife were experiencing health problems.
Cape Coral's wastewater is filtered and treated with chlorine,
but that doesn't eliminate parasites that can cause
gastrointestinal problems, such as vomiting and diarrhea, Lee
County Public Health Director Dr. Judith Hartner told AP.
"Mistakes were made," City Manager Terry Stewart told AP. "The
best we can do is make it right."
HEDSTROM CORPORATION: Recalls 116T Trampolines for Injury Hazard
----------------------------------------------------------------
Hedstrom Corporation is cooperating with the United States
Consumer Product Safety Commission by voluntarily recalling
116,000 Trampolines. Welds on the frame of these trampolines
can break during use, causing consumers to fall to the ground
and suffer injuries. Hedstrom has received about 700 reports of
one or more welds breaking from the trampoline frame rails
during use, resulting in 10 minor injuries.
These are 12-foot, 13-foot, and 14-foot trampolines, which
were sold separately, and also banded together with safety
enclosures. They were sold under the brand names Hedstrom and
NBF. The brand name is written on the warning labels found on
the products. The recalled trampolines have model numbers
10136, 101366, 101442, 10146, 102369, 102949, 10321, 103217 or
10381. They also have four-digit date codes ranging from 0403
through 2103 with the last two digits always being 03. Model
I.D. labels showing the model number and date code are located
on one of the frame rail legs on the trampoline.
Department, toy, and discount stores nationwide sold the items
between January 2003 and May 2003 for between $160 and $225 for
the single trampolines, and between $320 and $360 for the
trampolines banded together with safety enclosures.
For more details, contact the Company by Phone: (800) 841-4351
between 8 a.m. and 8 p.m. ET Monday through Friday, or visit the
firm's Website: http://www.hedstrom.comand click on Customer
Service.
IBM CORPORATION: MO Court Rule For Plaintiffs in Age Bias Suit
--------------------------------------------------------------
The United States District Court in East St. Louis, Missouri
granted summary judgment in favor of plaintiffs in the age
discrimination class action filed against IBM Corporation, the
St. Louis Post-Dispatch reports.
Judge G. Patrick Murphy ruled that the Company's pension plan
discriminates against older employees by reducing their benefits
as they age, ruling in favor of approximately 140,000 current
and former employees, who had argued that the pension plan was
adjusted twice since 1995 in a way that was unfair to older
members.
The suit relates to amendments the Company made to switch a
traditional plan to a cash-balance plan, which is generally
thought to benefit younger workers. Several age-discrimination
lawsuits were filed nationwide, causing the Internal Revenue
Service to stop approving them in 1999.
In his ruling, Judge Murphy wrote, "From an economist's
perspective, defendants have a good argument. A dollar today is
worth more than the promise of a dollar a year from now."
However, Judge Murphy said he didn't mean IBM's plan was legal
under the federal laws governing pensions. According to his
calculations, a 50-year-old employee with 15 years of experience
would get about $150 more in a monthly pension check than a 65-
year-old retiring with the same experience.
The Company might move to settle the case or appeal. Company
attorneys said in court that it was nonsensical to compare a 25-
year-old employee's benefit with a 64-year-old's, because the
older worker will get the benefit much sooner, the Post-Dispatch
reports. IBM's attorneys could not be reached to comment.
IDEAL INDUSTRIES: Recalls 122T Voltage Testers for Burn Hazard
--------------------------------------------------------------
Ideal Industries, Inc. is cooperating with the United States
Consumer Product Safety Commission by voluntarily recalling
122,000 Ideal Solenoid Voltage Testers. These testers can short
out at high voltages. Consumers can suffer burns.
Ideal has received 11 reports of these testers shorting out at
higher voltages, resulting in the faceplate blowing off the
units. Two users were burned when their units reportedly
shorted out. One reportedly sustained third-degree burns on his
hands, forearms, neck and face, while the other suffered second-
and third-degree burns to his hands.
These are Ideal voltage and voltage/continuity testers with
model numbers 61-065, 61-066, 61-067, 61-076, 61-079, and 61-
080. "IDEAL" and the model number are located on the front of
the tester. The tester body is yellow. The wire leads have one
black and one red test probe. Recalled units were manufactured
between November 1999 and May 2002.
Electrical distributors, industrial distributors and home
centers nationwide sold the products between December 1999 and
July 2003 for between $30 and $65.
For more details, contact the Company by Phone: (877) 557-8598
between 7 a.m. and 5 p.m. CT Monday through Friday or visit the
firm's Website: http://www.idealindustries.com.
INTERNATIONAL PLAYTHINGS: Recalls 5,000 Toys For Choking Hazard
---------------------------------------------------------------
International Playthings Inc. is cooperating with the United
States Consumer Product Safety Commission (CPSC) by voluntarily
recalling 5,000 Earlyears Bobbie Bear Stacking Rings. Plastic
knobs on the rings can detach, posing a choking hazard to young
children. The firm has received three reports of small parts
detaching from the rings, though no injuries have been reported.
The recalled Bobbie Bear Stacking Rings have a blue and orange
rounded bottom, two multicolored stacking rings, and an orange
plastic bear head topper. The toy can be spun like a top and
makes a rattling sound when shaken. The toy is designed for
children ages 6-24 months and has a model number of E00421,
which can be found on the packaging.
Specialty toy stores nationwide sold these toys from April 2002
through March 2003 for about $10.
For more details, contact the Company by Phone: (800) 445-8347
anytime or visit the firm's Website:
http://www.intplay.com/recall.htm
JIM BAKKER: Plaintiffs in Suit Over Theme Park to Receive $6.54
---------------------------------------------------------------
Plaintiffs in the class action against disgraced televangelist
Jim Bakker will receive $6.54 in payments, while their lawyers
will get $2.5 million of a $3.7 million settlement fund, the
Citizen-Times of Asheville reported.
Mr. Bakker was a popular televangelist who resigned from the
Praise The Lord ministries in 1987 after he admitted to having
an affair with a ministry secretary. He was later convicted of
a wire and mail-fraud scheme which sold more than 150,000
lifetime partnerships to a planned Heritage USA theme park in
Fort Mill, South Carolina. The park was never built, and
165,000 people joined a class action.
Asheville Asheville-based US District Judge Lacy Thornburg
ordered a California claims administrator to issue the checks
within a month. California-based law firm Thomas T. Anderson
and Associates had asked Judge Thornburg for the entire
settlement, saying it would be fruitless to search for everyone
involved in the suit, the Associated Press reports. Judge
Thornburg denied that request last year.
Mr. Bakker was initially sentenced to 45 years in prison but it
was later reduced to 18 years. He served five before his parole
in 1995. He is now back on the air with "The Jim Bakker Show,"
taped in Branson, Missouri.
KING PHARMACEUTICALS: Lawyers Vie For Lead Plaintiff Positions
--------------------------------------------------------------
Trial in the securities class actions filed against King
Pharmaceuticals, Inc. started in the United States District
Court for the Eastern District of Tennessee before magistrate
judge Dennis Inman, the Bristol Herald Courier reports.
Disgruntled stockholders - including large pension funds - filed
25 separate lawsuits, accusing the company of issuing misleading
financial statements concerning its business, financial
condition and results of operations during periods beginning
March 31, 1999 and continuing until March 11, 2003.
This caused stockholders to lose millions of dollars. The
Company has denied the charges
The initial hearing dealt mostly with whom will take the lead in
the suits. More than 12 lawyers were seeking lead plaintiff
position for their clients. Judge Inman emphasized that federal
law favors the appointment of the stockholder who lost the most
money, prompting a lively debate among the lawyers.
New York lawyer Douglas McKeige represents the pension funds for
the police officers and firefighters in Detroit, public
employees in Los Angeles and schoolteachers in Louisiana, which
he alleges lost a total of more than $6.2 million.
"Our complaints are very broad. We are bringing this case on
behalf of all stock purchasers," Mr. McKeige told the Herald
Courier. "All of them were open-market purchasers who bought
stock at inflated prices over the years, and the announcement
(of the SEC probe) comes and they all suffer a loss."
Lawyer Joseph Weiss of New York is pushing for his clients -
individuals who lost money as a result of the Company's
acquisition of Missouri-based Jones Pharma in 2000 - to be named
lead plaintiffs. Two investors, Jim O'Neal of Plano, Texas, and
Kathleen Crews of St. Charles, Mo., lost more than $1 million
each, he alleged. He asked Judge Inman to appoint one of the
Pharma plaintiffs as a co-lead plaintiff or allow the Jones
investors to be a subclass if the case is certified as a class
action.
The Jones investors and the open-market investors have
conflicting interests, Mr. Weiss argued, the Herald Courier
reports. "(The open-market plaintiffs) want to recover on
behalf of people who bought King stock over a four-year period,"
he said. "We are only seeking to recover on behalf of those who
bought stock on one day. They allege fraud; we just allege
misrepresentation."
Michael Dowd of San Diego asked the judge to allow his clients -
a group of health care workers, pipefitters, carpenters and a
bank - take the lead, saying that they lost more than $2.3
million. He argued the Louisiana teachers' pension is barred by
law because the group already is lead plaintiff in eight other
pending securities-fraud class actions.
The judge said that he will have a decision on the lead
plaintiff position in writing by the end of the week. After he
rules, the lead plaintiff's lawyer will have 60 days to file an
amended complaint. A hearing on certification of the case as a
class action will come some time after the new complaint is
filed. Another court date was not set.
MAGELLAN COMMUNICATIONS: Court Enjoins Execs From SEC Violations
----------------------------------------------------------------
United States District Court for the District of Nevada Judge
David W. Hagen entered final judgments against defendants Joseph
Norris and Mark Coleman, both of whom are residents of Carson
City, Nevada, and defendants Magellan Communications and
Northern Lights Financial, in a case in which the United States
Securities and Exchange Commission (SEC) alleged fraud in
connection with purported investment advisory services.
Under the terms of the final judgments, each defendant is
enjoined from violating the antifraud provisions of the federal
securities laws, Section 10(b) of the Securities Exchange Act of
1934, and Rule 10b-5 thereunder, and Sections 206(1) and 206(2)
of the Investment Advisers Act of 1940. The final judgments
order the defendants, jointly and severally, to pay disgorgement
of $6,020,997.30. The judgments also order Mr. Norris and Mr.
Coleman, jointly and severally, to pay prejudgment interest of
$879,254.29, and Magellan Communications and Northern Lights
Financial to pay prejudgment interest of $727,046.55.
In addition, the court imposed civil penalties of $120,000 each
against Mr. Norris and Mr. Coleman, and $550,000 each against
Magellan Communications and Northern Lights Financial. The
judgment against Mr. Norris and Mr. Coleman was entered upon the
SEC's motion for summary judgment, and the judgment against
Magellan Communications and Northern Lights Financial was
entered upon default.
The Commission's complaint alleged that the defendants raised
approximately $8.5 million from more than thirty clients by
promising to invest the money in offshore "trading programs"
that would generate returns of 4-7% per month, or the equivalent
of 48-84% per year.
According to the complaint, these "trading programs" had the
characteristics typical of fraudulent "prime bank" schemes,
which have been the subject of dozens of Commission enforcement
actions over the past decade. The Commission charged that Mr.
Norris and Coleman lost approximately $6 million of their
clients' funds in their attempts to invest in such "trading
programs," then sent their clients fictitious account statements
concealing the losses. The Commission also charged that Mr.
Norris and Mr. Coleman continued to encourage clients and
prospective clients to deposit money with them without
disclosing the losses.
On July 3, a Sacramento jury found Mr. Coleman guilty of seven
counts of federal wire fraud in connection with a similar
investment scheme. Mr. Norris previously pleaded guilty to one
count of wire fraud in connection with that scheme. Federal
criminal charges arising from the facts underlying the
Commission's case are still pending against both of them.
The entry of the foregoing final judgments concludes the
Commission's enforcement action arising from the fraudulent
investment advisory business conducted by the defendants.
MCI/WORLDCOM: House Asks For Documents on Long Distance Fraud
-------------------------------------------------------------
Lawmakers have started their probe on the allegations brought
against telecommunications firm MCI/Worldcom, the Associated
Press reports. The Company allegedly avoided paying millions of
dollars in access fees, by re-routing and disguising long
distance calls.
Worldcom, Inc. is working for its emergence from Chapter 11
bankruptcy protection after a $11 billion accounting scandal.
It is adopting the name of its MCI long-distance division in a
bid to clean up its image.
Rival carriers such as AT&T and former MCI executives alleged
that the Company masked long-distance calls as local calls and
diverted others to Canada to avoid paying special access fees to
local carriers across the country. As a result, other telephone
companies were defrauded of million of dollars. The Company has
denied the allegations, saying that its competitors are trying
to throw up roadblocks to its emergence from bankruptcy.
Chairman of the House Energy and Commerce Committee Billy
Tauzin, R-La., has asked the Federal Communications Commission
to explain how it is investigating the matter and to turn over
documents related to that probe within two weeks, AP reports.
In a letter to FCC Chairman Michael Powell, Rep. Tauzin wrote,
"A gross violation of regulations governing the origination and
termination of long-distance calls undermines the basic
telecommunications system of the United States . if true, these
allegations represent an unprecedented violation of FCC rules."
FCC spokesman Richard Diamond told AP the agency will "cooperate
fully with the committee and share the results of our own
investigation."
NEW YORK: Brooklyn Developer Sent To Prison Over Housing Scam
-------------------------------------------------------------
Brooklyn-based developer Isaac Toussie was sentenced to five
months in prison and five months home detention after he pleaded
guilty to falsifying loan documents that illegally qualified
about 100 homebuyers for U.S. Department of Housing and Urban
Development-backed mortgages, Newsday reports.
These homebuyers then bought houses built by Mr. Toussie and his
father, Robert, also a developer. The HUD said the housing
scam, which ran from 1996 to 1999, netted the Toussies $20
million and would cost the agency $6 million. Several mortgage
bankers, lawyers and appraisers have also pleaded guilty for
their involvement in the scheme, although Robert Toussie has not
been charged.
Three families who were victims of the scam also filed a class
action on behalf of more than 200 homeowners, alleging that the
were sold over-appraised, shoddily built homes, in the United
States District Court in Central Islip, New York.
The US Attorney's office and Mr. Toussie's attorneys battled for
months over the amount of restitution to pay HUD for its losses
on foreclosed homes, Newsday states. The government later
dropped its bid for restitution, saying prosecutors had a
difficult time determining the amount after many of HUD's
records were destroyed during the World Trade Center disaster,
according to Stephen King, an assistant US attorney.
Geral Shargel, one of Mr. Toussie's lawyers, asserted that the
government's dropped demand for restitution was a victory.
"Absolutely, we won. We're not paying any money," he told
Newsday.
Mr. Toussie was surrounded by his three lawyers as Judge Denis
Hurley read the plea agreement, which took months to negotiate.
Under the plea deal, he will serve two five-month prison
sentences concurrently for the HUD scam as well as for fraud
involving the sale of the 40-acre Chandler Estate, to Suffolk
County. A hearing regarding restitution and fines in the
Chandler Estate case is scheduled September 22.
Maxine Wilson, one of the plaintiffs in the class action, told
Newsday she was disappointed with yesterday's sentencing. "The
first chapter of this saga has been written and in that there is
no justice," said Wilson, who bought a Toussie home in Gordon
Heights in 1997.
OTG SOFTWARE: Forges Settlement For Consolidated Securities Suit
----------------------------------------------------------------
OTG Software, Inc. (now a wholly-owned subsidiary of Legato
Systems, Inc.) inked a settlement for a consolidated securities
class action filed in the United States District Court for the
Southern District of New York against it, its officers who
signed the registration statement in connection with OTG's
initial public offering, and the managing underwriters of the
initial public offering.
The complaint alleges that OTG's initial public offering
registration statement and final prospectus contained material
misrepresentations and/or omissions, related in part to
additional, excessive and undisclosed commissions allegedly
received by the underwriters from investors to whom the
underwriters allegedly improperly allocated shares of the public
offering. The complaint seeks relief in the form of damages
and/or rescission of the plaintiff's purchase transaction.
The suit is being heard along with other similar actions brought
against approximately 300 other issuers, officers and
underwriters in the Southern District of New York. On July 19,
2002, the defendants filed a motion to dismiss the complaint.
On February 19, 2003, the court denied defendants motion with
respect to the claims asserted against OTG. The Company denied
the allegations.
On June 26, 2003, the plaintiffs announced the terms of a
settlement in principle with the issuer defendants. Under the
terms of the settlement, Legato would not have to pay any of its
own funds to plaintiffs, and all of its attorneys fees and costs
beginning on June 1, 2003, would be paid by OTG's directors and
officers liability insurance carriers. A committee of Legato's
Board of Directors has approved the settlement proposal, but
before the settlement is final, it is subject to a number of
conditions, including approval by a sufficient number of other
issuers, agreement on a formal stipulation of settlement, and
court approval.
REUTERS NEWS: Black Employees Launch Racial Discrimination Suit
---------------------------------------------------------------
The Reuters News Group and Radianz, its US-based Internet
services subsidiary face a class action charging them with
racial discrimination, the Independent (UK) reports. The suit
alleges that black employees in Radianz had to work in a "racist
environment" where a "white, public school attitude" was
tolerated and where they were abused and persecuted.
Lawyer for the plaintiffs Douglas Wigdor stated the case of Eric
Berry, who allegedly repeatedly endured racial slurs from his
white supervisor and was often the butt of racist jokes. Mr.
Berry's supervisor David Flynn allegedly sent him an email which
depicted an electronically altered photograph of Mr. Berry with
a noose around his neck, fang-like teeth, braids in his hair and
a large black penis.
Mr. Wigdor, whose law firm was responsible for the recent class
action against Macy's stores for the racial profiling of people
suspected of shoplifting, also told the Independent that a
number of Radianz's 27 black employees received similar emails.
The suit further alleges that black employees were routinely
paid less than their white counterparts. Peter Snowden, who had
been a technical engineer at Radianz, told the Independent, "Not
only does Radianz continue to tolerate racial harassment in the
workplace and pay its African-American employees less than
similarly-situated white employees, the company looks at
African-American employees as troublemakers and gives white
employees the benefit of the doubt."
"It's astounding," Mr. Wigdor said. "The only way I can account
for this is that the management have done nothing about this.
The company's general counsel told one of our clients that
nothing could be done because the company is run by white men
from England and 'what can you do about it?' It's that public
school mentality."
Asked if he thought it would have happened if the management had
been American, he told the Independent, "There are plenty of
American companies where racism happens - but I think it would
have been less likely that it would have been done on such a
wide-scale basis."
Also assisting in the suit is prominent celebrity lawyer Johnnie
Cochran, famous for defending OJ Simpson. Mr Cochran told the
Independent, "It is difficult to imagine how, in 2003, a company
like Reuters could tolerate this sort of overt racist behavior
at the highest level in a business that it created and now
controls."
He added, "This lawsuit is meant to bring Reuters, Equant (the
co-owners) and Radianz into the 21st century, to stop the
disgusting practice of racism within these companies and to send
a message that such immoral behavior will not be tolerated no
matter how rich or powerful a company may be."
In a statement, Radianz said inquiries into Mr. Berry's
complaint have resulted in one employee being fired and three
others receiving disciplinary action. "Radianz absolutely
denies any and all allegations that it engages in or tolerates
discriminatory workplace practices of any kind," it said.
Nancy Bobrowitz, a spokeswoman for Reuters America, told the
Independent, "Reuters does not tolerate any form of
discrimination within our own firm and we will not tolerate it
in any of our affiliates."
SERVICES GROUP: WA Court Approves $1.95M Employee Suit Pact
-----------------------------------------------------------
The United States District Court in Seattle, Washington approved
the $1.95 million settlement proposed by Services Group of
America and Frank Russell Trust for an employee class action
alleging mismanagement of SGA's profit-sharing retirement plan,
the Associated Press reports.
More than 1,600 current and former workers of the Company will
share in the settlement. The Company will pay $1.75 million,
while Tacoma-based Frank Russell, which handled the plan's day-
to-day operations, will pay $200,000.
Judge Barbara Rothstein approved the suit against the Company,
which runs Food Services of America, a food-services
distributor, as well as real estate and travel businesses.
TOBACCO LITIGATION: IL Judges Make Different Rulings In Lawsuits
----------------------------------------------------------------
Two Madison County judges have made different rulings in a pair
of lawsuits related to the marketing of "light" cigarettes, the
Associated Press Newswires reports. Proceedings were stalled in
one case, but not in the other.
Circuit Judge George Moran has ruled that a class action filed
against R.J. Reynolds can go to trial before review of the
Philip Morris verdict is completed. Circuit Judge Andrew
Matoesian has ruled that proceedings in a class action against
Brown & Williamson Tobacco Co. should be postponed until the
appellate courts finish reviewing a $10.1 billion judgment
entered earlier this year in a similar case against Philip
Morris USA.
Plaintiffs' attorney Stephen Tillery filed all three lawsuits.
They allege that the tobacco companies misled Illinois smokers
into believing "light" cigarettes are less harmful than the
regular brands. The Philip Morris lawsuit marked the first time
a maker of light cigarettes was accused of fraud.
Judge Moran said in his ruling that the R.J. Reynolds case is
different from the Philip Morris case. "It seems clear to me
that while the theories of the (Philip Morris) and this case are
generally the same, from a factual standpoint, they are totally
different lawsuits," Judge Moran said.
Judge Matoesian, in a three-sentence ruling, simply said the
Brown & Williamson case would be put on hold during the appeal
of the Philip Morris case.
Joy Howell, spokeswoman for Stephen Tillery, who had filed all
three lawsuits, said the proceedings in the R.J. Reynolds case
are further along than the proceedings in the Brown & Williamson
case. The R.J. Reynolds case is set for trial in October; while
the Brown & Williamson trial was scheduled for March 2004.
VISHAY INTERTECHNOLOGY: DE Court Dismisses Siliconix Offer Suit
---------------------------------------------------------------
The Delaware Court of Chancery dismissed without prejudice the
class actions filed against Vishay Intertechnology, Inc.,
Siliconix and the directors of Siliconix in connection with the
Vishay's February 2001 proposal to purchase all issued and
outstanding Siliconix shares that it did not already own.
In February and March 2001, several suits were filed in the
Delaware Court of Chancery and the California Superior Court,
alleging that the Company's proposed offer was unfair and a
breach of fiduciary duty. One of the Delaware class actions
also alleged that the Company had usurped Siliconix inventory
and patents, appropriated Siliconix's separate corporate
identity, and obtained a below-market loan from Siliconix.
The actions sought injunctive relief, damages and other relief.
The Delaware Chancery Court denied a preliminary injunction
motion seeking to enjoin the tender offer, which was commenced
in May 2001 but not successfully completed. In December 2002,
the Delaware Chancery Court dismissed without prejudice the
Delaware litigation.
Also in December 2002, the plaintiffs in the action filed in the
California Superior Court filed a motion for dismissal of the
action without prejudice. Defendants have consented to that
motion, which is still pending.
WAL-MART STORES: Recalls Kiddie Sling Chairs For Choking Hazard
---------------------------------------------------------------
Wal-Mart Stores, Inc. is cooperating with the United States
Consumer Product Safety Commission by voluntarily recalling
75,200 Home Trends Kiddy Sling Chairs. The small plastic bolt
covers pose a choking hazard to small children. CPSC and Wal-
Mart have received two reports of children removing the small
covers and placing them in their mouths. No injuries have been
reported.
The chairs are steel outdoor chairs with a white frame and a
pink or blue sling fabric seat and back. The chairs measure
about 9.5 inches in height. The seats have two small plastic
covers located behind the back of the seat and two covers under
the seat.
For more details, contact Wal-Mart by Phone: (800) 925-6278
between 7 a.m. and 9 p.m. CT Monday through Friday or visit the
firm's Website: http://www.walmartstores.com.
New Securities Fraud Cases
AVATAR HOLDINGS: Charles Piven Files Securities Suit in DE Court
----------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities
class action on behalf of those who hold 7% convertible
subordinated notes due April 1, 2005 sold by Avatar Holdings,
Inc. (NasdaqNM:AVTR). The case is pending in the United States
District Court for the District of Delaware against the Company
and certain of its officers.
The action seeks disclosure of the basis on which Avatar's land
inventories are valued or damages that flow from the failure to
disclose it.
For more details, contact Charles J. Piven, PA by Mail: The
World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phone: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
CATALINA MARKETING: Fruchter & Twersky Lodges FL Securities Suit
----------------------------------------------------------------
The Law Firm of Fruchter & Twersky LLP initiated a securities
class action in the United States District Court for the Middle
District of Florida, on behalf of purchasers of Catalina
Marketing Corporation (NYSE: POS) publicly traded securities
during the period between January 17, 2002 and June 30, 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 numerous positive statements
concerning the Company's ability to grow its revenues and
earnings at a rapid pace and the strong demand that existed for
the Company's products, especially at its Health Resource
division.
In truth and in fact, however, the Company was experiencing a
slowdown in its revenue growth because its pharmaceutical
clients had curtailed their spending on promotional items, such
as the Company's newsletters, and retail pharmacies had become
more cautious about participating in the Company's advertising
programs and had reduced their distribution of the Company's
health newsletters.
On June 30, 2003, after the close of trading, the Company
revealed that it would not be able to timely file it s annual
report on Form 10-K and would have to restate its financial
results for fiscal 2003. When these facts were belatedly
disclosed the price of Catalina common stock was trading around
$16.00 per share down from over a Class Period high of $39.00
per share.
For more details, contact Jack G. Fruchter by Mail: One
Pennsylvania Plaza, 19th Floor, New York, New York 10119, by
Phone: (212) 279-5050, (800) 440-8986, by Fax: (212) 279-3655,
or by E-mail: JFruchter@FruchterTwersky.com.
CATALINA MARKETING: Charles Piven Lodges Securities Suit in FL
--------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of Catalina
Marketing Corporation (NYSE:POS) between April 18, 2002 and
October 1, 2002, inclusive. The case is pending in the United
States District Court for the Middle District of Florida.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the class period, which
statements had the effect of artificially inflating the market
price of the Company's securities.
For more details, contact Charles J. Piven by Mail: The World
Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phone: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
CATALINA MARKETING: Schiffrin & Barroway Files FL Stock Lawsuit
---------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in
the United States District Court for the Middle District of
Florida on behalf of all purchasers of the common stock of
Catalina Marketing Corporation (NYSE:POS) from April 18, 2002
through October 1, 2002, 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 numerous positive statements
concerning the Company's ability to grow its revenues and
earnings at a rapid pace and the strong demand that existed for
the Company's products, especially at its Health Resource
division.
In truth and in fact, however, the Company was experiencing a
slowdown in its revenue growth because its pharmaceutical
clients had curtailed their spending on promotional items, such
as the Company's newsletters, and retail pharmacies had become
more cautious about participating in the Company's advertising
programs and had reduced their distribution of the Company's
health newsletters.
When these facts were belatedly disclosed by the Company on
October 1, 2002, the price of Catalina common stock fell from
$27.97 per share to close at $17.90 per share -- a drop of 36% -
- on extremely heavy trading volume.
For more details, contact Marc A. Topaz or Stuart L. Berman by
Phone: 888-299-7706 (toll free) or 610-667-7706 or by E-mail:
info@sbclasslaw.com
CREE INC.: Hoffman & Edelson Launches Securities Suit in M.D. NC
----------------------------------------------------------------
Hoffman & Edelson, LLC filed a securities class action in the
United States District Court for the Middle District of North
Carolina on behalf of purchasers of the common stock of Cree,
Inc. (NasdaqNM:CREE) during the period from August 19, 1998
through June 13, 2003, inclusive and who suffered damages
thereby.
The complaint charges that Cree and certain of its officers and
directors violated the Securities Exchange Act of 1934. The
complaint alleges that during the class period the Company
issued statements that failed to disclose and/or misrepresented
the following adverse facts, among others:
(1) that the Company had materially overstated its net
income and earnings per share;
(2) that the defendants artificially boosted Cree's
operating income through an undisclosed agreement with
defendant Neal Hunter's brother, Jeff Hunter, the then
chairman of C3, that required C3 to accept shipments of
silicon carbide (SIC) crystals for the manufacture of
Moissanite gemstones far in excess of market demand;
(3) that the defendants failed to properly disclose how
officers and director's compensation was determined;
(4) that the defendants failed to disclose in its
registration statements and its prospectuses the proper
use of the proceeds from these offerings. For example,
in its January 14, 2000 prospectus, that Cree would
invest $5 million of the offering proceeds in World
Theatre, Inc.;
(5) that the defendants were actively concealing these
facts in order to manipulate the Company's earnings
outlooks in order to maintain its favorable stock
prices;
(6) that the Company lacked adequate internal controls and
was therefore unable to ascertain the true financial
condition of the Company;
(7) that the Company's earnings projections were lacking in
any reasonable basis when made; and
(8) that the false and misleading information caused Cree's
securities to trade at artificially high levels.
The market first learned of Cree's improper revenue recognition
practices on June 13, 2003. On that date, Cree announced that
Eric Hunter, its former CEO, President and Chairman, had filed a
private action accusing the Company and current Chairman F. Neal
Hunter of misleading investors and the SEC by issuing false
press releases and filing false financial statements.
The market reacted quickly to this news, and the price of Cree
common stock fell from $22.21 per share on June 12, 2003 to
$18.10 per share on June 13, 2003, a drop of over 18%, on
extremely heaving trading volume.
For more details, contact Jerold B. Hoffman by Mail: 45 W. Court
Street, Doylestown, PA 18901 by Phone: 877-537-6532 (toll free)
by Fax: 215-230-8735 or by E-mail: jhoffman@hofedlaw.com.
IMPATH INC.: Faruqi & Faruqi Lodges Securities Suit in S.D. NY
--------------------------------------------------------------
Faruqi & Faruqi LLP initiated a securities class action in the
United States District Court for the Southern District of New
York on behalf of all purchasers of IMPATH, Inc. (NasdaqNM:IMPH)
securities between February 24, 2002 and July 29, 2003,
inclusive.
The complaint charges defendants with violations of federal
securities laws by, among other things, issuing a series of
materially false and misleading press releases concerning
IMPATH's financial results and business prospects.
Specifically, the complaint alleges that IMPATH failed to
disclose the following adverse facts, among others:
(1) that the Company was failing to timely record an
impairment in the value of its accounts receivables and
that as a result, the Company's reported financial
results were artificially inflated throughout the class
period;
(2) that the Company was failing to properly account for
its GeneBank(TM) asset, thereby overstating its
reported financial results; and
(3) as a result of the foregoing, the Company's financial
statements published during the Class Period were not
prepared in accordance with Generally Accepted
Accounting Principles and were therefore materially
false and misleading.
On July 30, 2003, IMPATH shocked the market when it issued a
press release announcing that it had initiated an investigation
into possible accounting irregularities involving accounts
receivables which the Company believes have been materially
overstated and will likely require restatement. Following this
announcement, shares of IMPATH common stock were halted from
trading.
For more details, contact David H. Leventhal, Anthony Vozzolo by
Mail: 320 East 39th Street, New York, NY 10016 by Phone:
(877) 247-4292 or (212) 983-9330 or by E-mail:
dleventhal@faruqilaw.com or Avozzolo@faruqilaw.com
IMPATH INC.: Abbey Gardy Lodges Securities Fraud Suit in S.D. NY
----------------------------------------------------------------
Abbey Gardy, LLP initiated a securities class action in the
United States District Court for the Southern District of New
York on behalf of all persons who purchased securities of
IMPATH, Inc. (Nasdaq: IMPH) between February 24, 2000 and July
29, 2003 inclusive. The suit names as defendants the Company
and:
(1) Anu D. Saad,
(2) James Agnello,
(3) Carter Eckert,
(4) Richard Adelson and
(5) David Cammarata
The complaint alleges that defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of material
misrepresentations to the market during the class period thereby
artificially inflating the price of IMPATH securities.
The complaint alleges that defendants issued a series of
materially false and misleading press releases and SEC filing
starting on February 24, 2000 and continuing to July 29, 2003
concerning the Company's publicly reported revenues and
earnings.
In particular, it is alleged that defendants overstated the
Company's revenues and net income for the first quarter of 2003,
and all of 2002, 2001 and 2000. Before the market opened on
July 30, 2003, IMPATH issued a press release announcing that it
had initiated an investigation in possible accounting
irregularities involving its accounts receivable.
Accordingly, the press release, reported that the Company
believed that its accounts receivable were overstated and that
the resulting financial impact would be material. Moreover, the
Company stated that its financial statements could not be relied
upon. On this news, IMPATH's stock was halted from trading.
For more details, contact Nancy Kaboolian by Phone:
(212) 889-3700 or 800-889-3701 or by E-mail:
nkaboolian@abbeygardy.com.
IMPATH INC.: Schiffrin & Barroway Launches Securities Suit in NY
----------------------------------------------------------------
Schiffrin & Barroway, LLP initiated a securities class action in
the United States District Court for the Southern District of
New York on behalf of all purchasers of the common stock of
Impath, Inc. (NasdaqNM:IMPH) from February 21, 2001 through July
29, 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 numerous positive statements
throughout the class period regarding the Company's financial
performance.
As alleged in the complaint, these statements were each
materially false and misleading when made as they failed to
disclose and misrepresented the following material adverse facts
which were then known to defendants or recklessly disregarded by
them:
(1) that the Company was failing to timely record an
impairment in the value of its accounts receivables.
As a result, the Company's reported financial results
were artificially inflated throughout the Class Period;
(2) that the Company was failing to properly account for
its GeneBank(TM) asset, thereby overstating its
reported financial results; and
(3) as a result of the foregoing, the Company's financial
statements published during the Class Period were not
prepared in accordance with Generally Accepted
Accounting Principles and were therefore materially
false and misleading.
On July 30, 2003, Impath shocked the market when it issued a
press release announcing that it had initiated an investigation
into possible accounting irregularities involving accounts
receivables which the Company believes have been materially
overstated and will likely require restatement. Following this
announcement, shares of Impath common stock were halted from
trading.
For more details, contact Marc A. Topaz or Stuart L. Berman by
Phone: (888) 299-7706 (toll free) or (610) 667-7706 or by E-
mail: info@sbclasslaw.com
IMPATH INC.: Charles Piven Commences Securities Suit in S.D. NY
---------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of IMPATH, Inc.
(NasdaqNM:IMPH) between February 24, 2000 and July 29, 2003,
inclusive. The case is pending in the United States District
Court for the Southern District of New York against defendant
IMPATH, Inc. and certain of its officers and directors.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the class period, which
statements had the effect of artificially inflating the market
price of the Company's securities.
For more details, contact Charles J. Piven, PA by Mail: The
World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phone: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
IMPATH INC.: Milberg Weiss Commences Securities Suit in N.D. CA
---------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities
class action in the United States District Court for the
Northern District of California on behalf of purchasers of
Solutia Inc. (NYSE: SOI) publicly traded securities during the
period between December 16, 1998 and October 10, 2002.
The complaint charges Solutia and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Solutia manufactures and markets a wide variety of high
performance chemical-based materials. Solutia maintained a 50%
interest in Flexsys, Nev. (a supplier of process chemicals to
the rubber industry) for which Solutia used the equity method of
accounting.
The complaint alleges that by engaging in the alleged illegal
acts, as described below, defendants were able to recognize
equity interest and control over Flexsys. Solutia's equity
earnings from Flexsys were as follows: $11 million in 2002, $12
million in 2001 and $12 million in 2000.
During the class period, defendants caused Solutia's shares to
trade at artificially inflated levels through the issuance of
false and misleading financial statements via their control over
Flexsys by:
(1) agreeing to charge prices at certain levels and
otherwise to fix, increase, maintain or stabilize
prices of rubber chemicals sold in the U.S;
(2) selling rubber chemicals at the agreed upon prices; and
(3) inflating their profits via the above acts.
For more details, contact William Lerach by Phone: 800-449-4900
by E-mail: wsl@milberg.com or visit the firm's Website:
http://www.milberg.com
IMPATH INC.: Cauley Geller Lodges Securities Lawsuit in S.D. NY
---------------------------------------------------------------
Cauley Geller Bowman & Rudman, LLP initiated a securities class
action in the United States District Court for the Southern
District of New York, on behalf of purchasers of Impath, Inc.
(Nasdaq: IMPH) publicly traded securities during the period
between February 21, 2001 and July 29, 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 numerous positive statements
throughout the class period regarding the Company's financial
performance.
As alleged in the complaint, these statements were each
materially false and misleading when made as they failed to
disclose and misrepresented the following material adverse facts
which were then known to defendants or recklessly disregarded by
them:
(1) that the Company was failing to timely record an
impairment in the value of its accounts receivables.
As a result, the Company's reported financial results
were artificially inflated throughout the class period;
(2) that the Company was failing to properly account for
its GeneBank(TM) asset, thereby overstating its
reported financial results; and
(3) as a result of the foregoing, the Company's financial
statements published during the class period were not
prepared in accordance with Generally Accepted
Accounting Principles and were therefore materially
false and misleading.
On July 30, 2003, Impath shocked the market when it issued a
press release announcing that it had initiated an investigation
into possible accounting irregularities involving accounts
receivables which the Company believes have been materially
overstated and will likely require restatement. Following this
announcement, shares of Impath common stock were halted from
trading.
For more details, contact Samuel H. Rudman, David A. Rosenfeld,
Jackie Addison or Heather Gann by Mail: P.O. Box 25438, Little
Rock, AR 72221-5438 by Phone: 1-888-551-9944 by Fax:
1-501-312-8505 or by E-mail: info@cauleygeller.com
QWEST SOFTWARE: Brodsky & Smith Files Securities Suit in C.D. CA
----------------------------------------------------------------
The Law offices of Brodsky & Smith, LLC initiated a securities
class action on behalf of shareholders who purchased the common
stock and other securities of Quest Software, Inc.
(NasdaqNM:QSFT), between April 30, 2002 and July 23, 2003
inclusive. The class action lawsuit was filed against the
Company and certain of its officers and directors in the United
States District Court for the Central District of California.
The complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market during the class period,
thereby artificially inflating the price of Quest securities.
On July 23, 2003, the Company revealed that its 2002 results and
first quarter results for 2003 were false when issued due to a
computational error in revenue recognition.
For more details, contact Marc L. Ackerman or Evan J. Smith by
Mail: Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004, by
Phone: 877-LEGAL-90 or by E-mail: clients@brodsky-smith.com
QWEST SOFTWARE: Charles Piven Lodges Securities Suit in C.D. CA
---------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of Quest
Software, Inc. (NasdaqNM:QSFT) between April 30, 2002 and July
23, 2003, inclusive. The case is pending in the United States
District Court for the Central District of California against
defendant Quest and certain of its officers and directors.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the class period which
statements had the effect of artificially inflating the market
price of the Company's securities.
For more details, contact Charles J. Piven by Mail: The World
Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phone: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
QWEST SOFTWARE: Milberg Weiss Lodges Securities Suit in C.D. CA
---------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities
class action in the United States District Court for the Central
District of California on behalf of purchasers of Quest
Software, Inc. (NASDAQ:QSFT) publicly traded securities during
the period between April 30, 2002 and July 23, 2003.
The complaint charges Quest and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Quest provides application and information availability
software solutions that enhance the performance and reliability
of e-business, enterprise and custom applications and enable the
delivery of information across the enterprise.
The complaint alleges that during the class period, defendants
caused Quest's shares to trade at artificially inflated levels
through the issuance of false and misleading financial
statements. On July 23, 2003, Quest revealed that its 2002 and
Q1 03 results were false when issued due to a "computational
error" in revenue recognition. The stock dropped below $9 per
share on this news.
For more details, contact William Lerach by Phone: 800-449-4900
by E-mail: wsl@milberg.com or visit the firm's Website:
http://www.milberg.com
SOLUTIA INC.: Milberg Weiss Launches Securities Suit in N.D. CA
---------------------------------------------------------------
Milberg Weiss Bershad Hynes & Lerach LLP initiated a securities
class action in the United States District Court for the
Northern District of California on behalf of purchasers of
Solutia Inc. (NYSE: SOI) publicly traded securities during the
period between December 16, 1998 and October 10, 2002.
The complaint charges Solutia and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. Solutia manufactures and markets a wide variety of high
performance chemical-based materials. Solutia maintained a 50%
interest in Flexsys, Nev. (a supplier of process chemicals to
the rubber industry) for which Solutia used the equity method of
accounting.
The complaint alleges that by engaging in the alleged illegal
acts, as described below, defendants were able to recognize
equity interest and control over Flexsys. Solutia's equity
earnings from Flexsys were as follows: $11 million in 2002, $12
million in 2001 and $12 million in 2000.
During the class period, defendants caused Solutia's shares to
trade at artificially inflated levels through the issuance of
false and misleading financial statements via their control over
Flexsys by:
(1) agreeing to charge prices at certain levels and
otherwise to fix, increase, maintain or stabilize
prices of rubber chemicals sold in the U.S;
(2) selling rubber chemicals at the agreed upon prices; and
(3) inflating their profits via the above acts.
For more details, contact William Lerach by Phone: 800-449-4900
by E-mail: wsl@milberg.com or visit the firm's Website:
http://www.milberg.com
SOLUTIA INC.: Charles Piven Commences Securities Suit in N.D. CA
----------------------------------------------------------------
The Law Offices Of Charles J. Piven, PA initiated a securities
class action on behalf of shareholders who purchased, converted,
exchanged or otherwise acquired the common stock of Solutia,
Inc. (NYSE:SOI) between December 16, 1998 and October 10, 2002,
inclusive. The case is pending in the United States District
Court for the Northern District of California against Solutia,
Inc. and certain of its officers and directors.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the class period which
statements had the effect of artificially inflating the market
price of the Company's securities.
For more details, contact Charles J. Piven, PA by Mail: The
World Trade Center-Baltimore, 401 East Pratt Street, Suite 2525,
Baltimore, Maryland 21202, by Phoine: 410-986-0036 or by E-mail:
hoffman@pivenlaw.com
STELLENT INC.: Cauley Geller Lodges Securities Suit in MN Court
---------------------------------------------------------------
The Law Firm of Cauley Geller Bowman & Rudman, LLP initiated a
securities class action in the United States District Court for
the District of Minnesota, on behalf of purchasers of Stellent,
Inc. (Nasdaq: STEL) publicly traded securities during the period
between October 2, 2001 and April 1, 2002, 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 materially false
and misleading statements concerning the Company's revenue
growth and its financial performance.
As alleged in the complaint, these statements were materially
false and misleading because they failed to disclose and/or
misrepresented the following adverse facts, among others:
(1) that significant amounts of the Company's sales were to
affiliates that were financed by the Company itself;
and
(2) that the Company's customer base was beginning to defer
purchases and the expected revenue growth which the
Company touted in press releases would no longer occur.
When these facts were belatedly disclosed to the market, the
price of Stellent common stock declined precipitously.
For more details, contact Samuel H. Rudman, David A. Rosenfeld,
Jackie Addison or Heather Gann by Mail: P.O. Box 25438, Little
Rock, AR 72221-5438 by Phone: 1-888-551-9944 by Fax:
1-501-312-8505 or by E-mail: info@cauleygeller.com
*********
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Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities. The Asbestos Defendant Profiles is backed by an
online database created to respond to custom searches. Go to
http://litigationdatasource.com/asbestos_defendant_profiles.html
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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Fatima Antonio and Lyndsey Resnick, Editors.
Copyright 2003. All rights reserved. ISSN 1525-2272.
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