/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/040706.mbx C L A S S A C T I O N R E P O R T E R Tuesday, July 6, 2004, Vol. 6, No. 132 Headlines ACCLAIM ENTERTAINMENT: NY Court Refuses Dismissal of Stock Suit ARIZONA: Activist Lodges Civil Suit To Limit Campaign Donors AT&T CORPORATION: 50T NC Consumers To Receive $500T in Refunds COX COMMUNICATIONS: Reaches Settlement for LA Consumer Lawsuit COX COMMUNICATIONS: Plaintiffs Appeal Dismissal of Investor Suit COX COMMUNICATIONS: Ask NY Court To Dismiss Claim in Stock Suit FLORIDA: Pinellas County Court Grants Certification to Bias Suit INDIA: UB, McDowell & Co. To End Lawsuit Against Restructuring INDIANA STATE: Warns Consumers Of Salmonella Contaminated Cheese INTERVOICE-BRITE INC.: Opposes Appeal of TX Stock Suit Dismissal LANCER CORPORATION: Shareholders Lodge Securities Lawsuit in TX MARK NICHOLS: SEC Bars Representative Due To Unauthorized Trades NY STATE: Issues Warning Over Mayonnaise Due To Undeclared Eggs TOWRY LAW: Investors Urged To Join Worldwide Stock Fraud Lawsuit YUKOS OIL: Lerach Coughlin Lodges Shareholder Lawsuit in S.D. NY New Securities Fraud Cases 99 CENTS: Murray Frank Files Securities Fraud Lawsuit in C.D. CA ALLIANCE GAMING: Marc Henzel Lodges Securities Suit in NV Court ALLOS THERAPEUTICS: Marc Henzel Lodges Securities Lawsuit in CO ASCONI CORPORATION: Marc Henzel Lodges Securities Lawsuit in FL BEA SYSTEMS: Schatz & Nobel Lodges Securities Lawsuit in N.D. CA BEA SYSTEMS: Charles J. Piven Lodges Securities Suit in N.D. CA CANADIAN SUPERIOR: Marc Henzel Lodges Securities Suit in S.D. NY CARDINAL HEALTH: Scott + Scott To Lodge Securities Lawsuit in OH CARDINAL HEALTH: Marc Henzel Lodges Securities Suit in S.D. OH HANGER ORTHOPEDIC: Marc Henzel Lodges Securities Suit in E.D. VA HIBERNIA FOODS: Weiss & Yourman Files Securities Suit in S.D. NY KEY ENERGY: Murray Frank Lodges Securities Fraud Suit in W.D. TX KEY ENERGY: Marc Henzel Lodges Securities Fraud Suit in W.D. TX KRISPY KREME: Chimicles & Tikellis Files Securities Suit in NC LANCER CORPORATION: Marc Henzel Files Securities Suit in W.D. TX LEHMAN ABS: Abbey Gardy Lodges Securities Fraud Suit in S.D. NY MERIX CORPORATION: Marc Henzel Files Securities Fraud Suit in OR SHAW GROUP: Brodsky & Smith Lodges Securities Lawsuit in E.D. LA SIEBEL SYSTEMS: Marc Henzel Lodges Securities Suit in N.D. CA SYNOVIS LIFE: Brodsky & Smith Commences Securities Lawsuit in MN ********* ACCLAIM ENTERTAINMENT: NY Court Refuses Dismissal of Stock Suit --------------------------------------------------------------- The United States District Court for the Eastern District of New York refused to dismiss the consolidated securities class action filed against Acclaim Entertainment, Inc. and certain of its officers and/or directors, styled "In re Acclaim Entertainment, Inc. Securities Litigation, Master File No.2, 03-CV-1270 (E.D.N.Y.) (JS) (ETB). Class members Penn Capital Management, Robert L. Mannard and Steve Russo were appointed as lead plaintiffs, and their selection of counsel was approved. The consolidated suit specifically names as defendants the Company and: (1) Gregory Fischbach, (2) Edmond Sanctis, (3) James Scoroposki and (4) Gerard F. Agoglia The Consolidated Complaint alleges a class period from October 14, 1999 through January 13, 2003. The Consolidated Complaint alleges that the Company engaged in a variety of wrongful practices which rendered statements made by the Company and its financial statements to be false and misleading. Among other purported wrongful practices, the Consolidated Complaint alleges that Acclaim engaged in "channel stuffing," a practice by which Acclaim allegedly: (i) delivered excess inventory to its distributors to meet or exceed analysts' earnings expectations and inflate its sales results; (ii) entered into "conditional sales agreements" whereby Acclaim's customers allegedly were induced to accept delivery of Acclaim products prior to a quarter-end reporting period on the condition that Acclaim would accept the return of any unsold product after the quarter-end, and (iii) falsified sales reports and manipulated the timing and recognition of price concessions and discounts granted to its retail customers. The Consolidated Complaint further alleges that the Company engaged in improper accounting practices, including the improper recognition of sales revenue; manipulation of reserves associated with concessions, chargebacks and/or sales discounts granted to customers; and the improper reporting of software development costs. The Consolidated Complaint alleges that as a result of these practices defendants violated Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-5, and that the individual defendants violated Section 20(a) of the 1934 Act. The Consolidated Complaint seeks compensatory damages in an unspecified amount. On December 3, 2003 the Company moved to dismiss the Consolidated Complaint. Plaintiffs opposed the motion to dismiss on January 20, 2004, and the Company submitted its reply papers on February 20, 2004. The court denied the motion. A scheduling conference has been scheduled for August 9, 2004. ARIZONA: Activist Lodges Civil Suit To Limit Campaign Donors ------------------------------------------------------------ Attorneys for Chester Soling, 73, a Tucson, Arizona-based political activist filed a civil class action in the United States District Court in Arizona in a bid to restrict political candidates from taking contributions anywhere other than in the areas they hope to represent, the Tucson Citizen reports. The suit, filed on behalf of all Arizonans, names as defendants Arizona Republicans: U.S. Sen. John McCain a champion of campaign finance reform and U.S. Rep. Jim Kolbe as well as all candidates running against the two in the upcoming election. That includes such personalities as Phoenix public relations executive Stuart Starky and Libertarian Ernest Hancock, who are running against McCain. Also included are Kolbe challengers: computer consultant Jeffrey Chimene, Tim Sultan, former Tucson Unified School District board member Eva Bacal and state Rep. Randy Graf, R-Green Valley. Mr. Soling, a longtime political activist who moved to Tucson in 2002, said the current system of campaign finance violates the sworn duty of elected officials to represent only those who are eligible to elect them. "Candidates should restrict themselves to their own district, Right now, our representatives don't talk for us. They're not speaking for the average person who they represent," Mr. Soling told the Tucson Citizen. The civil suit says federal elected officials "owe a legal duty to their constituents to not be beholden to anyone other than their constituents." It seeks a court order to prohibit candidates from accepting contributions from donors who do not live in the districts where they are running. Mr. Soling also told the Tucson Citizen that; "McCain already has more campaign money than he could possibly need. He has no serious challengers and also has more than enough personal wealth. Why is he still taking money from out of state? And what do those donors expect in return?" Marshall Wittmann, McCain's communications director, dismisses the suit as frivolous. Kolbe's campaign manager, state Sen. Toni Hellon told the Tucson Citizen in a phone interview that; "It's a nuisance lawsuit, and people have the right to support anyone they want to, We're here with supporters who used to be constituents and still want to help him. Why shouldn't they be able to still support him?" Phoenix attorney Leon Silver, who represents Soling, doesn't expect the court to dismiss the suit out of hand. A similar suit succeeded in Alaska several years ago and has been upheld on appeal, he said. Another Alaska suit and one in California were not successful, he said. Mr. Soling hopes others who want change in the campaign finance process will support the case, which he expects to go all the way to the U.S. Supreme Court. He also hopes that taking on a lawmaker with McCain's national stature will bring attention to his cause. "If I win, it will apply only to Arizona, but with his high profile, I'm hoping national groups such as Common Cause will fly this up the flagpole." He also wanted to see the political process embrace the constitutional right to petition elected officials for change and quipped that "Instead of buying your candidate, you're supposed to petition him." Soling's Web site, www.congressabuse.com , provides more information about the suit and how to support his effort. AT&T CORPORATION: 50T NC Consumers To Receive $500T in Refunds -------------------------------------------------------------- Nearly 50,000 North Carolina consumers who were overcharged by AT&T will share in more than $500,000 in refunds and credits, North Carolina Attorney General Roy Cooper announced in a statement. An extra monthly charge of $3.95 first appeared on some consumers' bills for AT&T long distance service in January 2004. Several consumers who did not subscribe to AT&T for long distance were also billed for the fee. AG Cooper's office first found out about the billing problems when consumers began calling to complain. Approximately 80 consumers have filed complaints about the extra charges with the Attorney General's Consumer Protection Division. After meeting with attorneys from AG Cooper's office, AT&T agreed to provide refunds and credits to all North Carolina consumers who were billed in error, the Attorney General said in his announcement. According to an affidavit filed this week by AT&T, the company overcharged 11,202 AT&T customers and 36,883 non-customers in North Carolina. These consumers will get a total of more than $500,000 back. Current AT&T customers who paid the extra fee should look for credits on their phone bill. Non-AT&T customers should receive their refund by mail. " People shouldn't have to pay for a charge they didn't agree to," said AG Cooper. "Consumers let us know about these extra charges, and we were able to help get their money back." Consumers who were billed in error by AT&T do not need to file a complaint with AG Cooper's office in order to receive their refund or credit. The company also says that it has taken steps to ensure that consumers are not overcharged again. "To make sure you don't get stuck with charges you don't owe, study your monthly phone bill just as carefully as you would your bank and credit card statements," AG Cooper advised consumers. "If you think you've been overcharged, call your phone company and also let my office know about it." Consumers who believe that they have been billed incorrectly by a telephone company can contact the Attorney General's Consumer Protection Division at (877)-5-NO-SCAM to file a complaint. For more details, contact Noelle Talley, Public Information Officer, N.C. Department of Justice by Phone: (919) 716-6484 or (919) 716-6413 or by Fax: (919) 716-0803 or by E-mail: ntalley@ncdoj.com COX COMMUNICATIONS: Reaches Settlement for LA Consumer Lawsuit -------------------------------------------------------------- Cox Communications Louisiana LLC reached a settlement for the putative subscriber class action filed against it in Louisiana state court, challenging the propriety of late fees it charged in the greater New Orleans area to customers who fail to pay for services in a timely manner. The suit seeks injunctive relief and damages under certain claimed state law causes of action. The settlement has been submitted to the court for final approval. COX COMMUNICATIONS: Plaintiffs Appeal Dismissal of Investor Suit ---------------------------------------------------------------- Plaintiffs appealed the United States District Court for the Northern District of California's ruling upholding the dismissal of the class action filed against Cox Communications, Inc. and David Woodrow, its former Executive Vice President for Business Development. Jerrold Schaffer and Kevin J. Yourman, on May 26, 2000 and May 30, 2000, respectively, filed class action lawsuits in the Superior Court of California, San Mateo County, on behalf of themselves and all other stockholders of Excite@Home as of March 28, 2000, seeking to enjoin consummation of a March 28, 2000 letter agreement among Excite@Home's principal investors, including Cox, and unspecified compensatory damages. Mr. Woodrow formerly served on the Excite@Home board of directors. The plaintiffs assert that the defendants breached purported fiduciary duties of care, candor and loyalty to the plaintiffs by entering into the letter agreement and/or taking certain actions to facilitate the consummation of the transactions contemplated by the letter agreement. On February 26, 2001, the Court stayed both actions, which had been previously consolidated, on grounds of forum non-conveniens. A related suit styled Linda Ward, et al. v. At Home Corporation (No. 418233) was filed on September 6, 2001, in the same court. On February 7, 2002, the Court consolidated the Ward action with the Schaffer/Yourman action, thereby also staying the Ward action. On June 18, 2002, the court granted plaintiffs' motion to lift the stay and authorized discovery to proceed regarding Cox's pending motion to dismiss for lack of personal jurisdiction. On September 10, 2002, the United States Bankruptcy Court for the Northern District of California in the Excite@Home bankruptcy proceeding held that the claims in the suits were derivative and, thus, constituted the exclusive property of the Excite@Home bankruptcy estate. The Bankruptcy Court thereafter ordered the plaintiffs to dismiss the suits. Plaintiffs subsequently appealed the Bankruptcy Court's decision to the United States District Court for the Northern District of California. On September 29, 2003, the District Court affirmed the order of the Bankruptcy Court. Plaintiffs promptly appealed the decision to the United States Court of Appeals for the Ninth Circuit. COX COMMUNICATIONS: Ask NY Court To Dismiss Claim in Stock Suit --------------------------------------------------------------- Cox Communications, Inc. asked the United States District Court for the Southern District of New York to dismiss a remaining claim in the class action filed against it, AT&T Corporation, and certain former officers and directors of Excite@Home. On April 26, 2002, Frieda and Michael Eksler filed an amended complaint. This case has been consolidated with a related case captioned Semen Leykin v. AT&T Corp., et al., and another related case, and an amended complaint in the consolidated case, naming Cox as a defendant, was filed and served on November 7, 2002. The putative class includes persons who purchased and held shares of Excite@Home common stock between the time period March 28, 2000 and September 28, 2001. The sole count against Cox asserts a claim against Cox as an alleged "controlling person" of Excite@Home under Section 20(a) of the Securities Exchange Act for violations of Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder. The suit seeks from Cox unspecified monetary damages, statutory compensation and other relief. In addition, a claim against Cox's former Executive Vice President, David Woodrow, who formerly served on Excite@Home's board of directors, is asserted for breach of purported fiduciary duties. The suit seeks from Mr. Woodrow unspecified monetary and punitive damages. On February 11, 2003, Cox and Mr. Woodrow filed a dispositive motion to dismiss on various grounds, including failure to state a claim. On September 17, 2003, the District Court granted the motion in part and denied it in part. Specifically, the Court dismissed several purported statements by Excite@Home as bases for potential liability because they were merely generalized expressions of confidence and optimism constituting "puffery," dismissed the fiduciary duty claim against Mr. Woodrow as pre-empted by the federal securities laws, and denied the motions as to the remaining allegations of the complaint. On October 7, 2003, Cox and Mr. Woodrow sought reconsideration of a portion of the Court's order. On December 24, 2003, the plaintiffs moved to certify a class of persons who purchased Excite@Home stock between March 28, 2000 and September 28, 2001, or held such stock as of April 28, 2000. This motion is pending. On February 17, 2004, the Court granted plaintiffs leave to file a motion to amend the complaint to add an additional claim for relief against all defendants under Section 14(a) of the Securities Exchange Act in connection with an allegedly false or misleading proxy statement issued by Excite@Home. On February 24, 2004, the Court granted Cox's and Mr. Woodrow's motion for reconsideration and dismissed plaintiffs' allegations that Cox and Mr. Woodrow were "control persons" with respect to primary violations of Rule 10b-5 alleged to have occurred after August 28, 2000. On April 5, 2004, Cox and certain other defendants jointly filed a motion to dismiss the Section 14(a) cause of action that was added in plaintiffs' amended complaint, and briefing of that motion is ongoing. FLORIDA: Pinellas County Court Grants Certification to Bias Suit ---------------------------------------------------------------- Pinellas-Pasco Circuit Judge James Case granted class-action status to a 2000 lawsuit charging Pinellas County schools in Florida with failing to adequately educate black students, The Ledger Online reports. The judge's decision virtually expands the complaint to 21,000 current students and all black children who will attend the county's public schools in the future. The suit was filed in October 2000 -- a week after a federal judge approved a settlement between the district and the NAACP Legal Defense Fund, declaring the schools discrimination-free -- on behalf of William Crowley and his son Akwete Osoka, who was then a second-grader at Sawgrass Lake Elementary School. It claims the district failed to narrow the achievement gap between black and white students in violation of the state Constitution's equal protection clause, and asks the district to craft a solution. School district lawyers argued against class-action status, saying each child's performance may be based on individual circumstances. Judge Case did not agree and ruled that the suit challenged the system's overall ability to provide a "high quality" education to black students, "not how that system has dealt with a particular student on an individual basis," The Ledger Online reports. INDIA: UB, McDowell & Co. To End Lawsuit Against Restructuring -------------------------------------------------------------- In the wake of talks between Mr. Vijay Mallya, UB group chairman and Jumbo Group Chairperson, Ms. Vidya Manohar Chhabria, who controls Shaw Wallace & Co. (SWC), the UB Chairman and McDowell & Co. Ltd. decided to end a class action lawsuit filed in 2002 against the corporate restructuring undertaken by archrival SWC and the sale of shares by the latter to SABMiller, the Asia Intelligence Wire reports. The decision not to pursue the case virtually buries disputes between the India's two largest liquor businesses. Mr. Mallya through his group spirits company filed a class action suit in the Mumbai High Court opposing SWC restructuring and its move to divest shares citing shareholder interest and also in view of his pending suit in a Hong Kong court claiming control over the latter. McDowell & Co. owned about 10,000 shares in SWC giving it the locus standi to move the court against restructuring and sale of shares. SABMiller acquired 50% stake and management control in SWC's restructured beer arm - Shaw Wallace Breweries - for $132.8 million. The industry sources told Asia Intelligence Wire that the move to bury the hatchet in the Mumbai High Court was part of a larger settlement between Mr. Mallya and the Jumbo Group, which acquired SWC from RG Shaw and Sime Darby in 1985 for $28 million. Mr. Mallya through two investment firms, of which he has beneficial interest, has been waging a legal battle to establish that he had partnered the late Manu Chhabria, the founder Chairman of the Dubai-based Jumbo Group, in acquiring SWC. Both UB and Jumbo indicated that talks to resolve the dispute was progressing but remained wary of divulging more details suggesting the fragile nature of peace given the acrimonious past and the burden of distrust between the two camps. INDIANA STATE: Warns Consumers Of Salmonella Contaminated Cheese ---------------------------------------------------------------- Sharp cheddar cheese, sold under the Meadow Valley Farm brand, may have been purchased since May 1, 2004 at farmers' markets, specialty food stores or directly from a Parke County, IN farm. Investigators with the Indiana State Board of Animal Health's Dairy Division (BOAH) are working to determine exactly how much and where the cheese was sold. Initial information indicates that product from a contaminated batch was distributed in and around Rockville, IN; Middlebury, IN and at least site in Wisconsin. Consumers should not eat this product, but promptly dispose of it or return it to the place of purchase. No illnesses have been linked to this cheese. The cheese can be identified by the round product label, which prominently states "Natural Raw Milk Cheese". Also printed on the label are "Meadow Valley Farm" and "Made in Parke County" below a red barn. A small label on the back of the package notes a hand-printed lot number of "139". The cheese was sold in blocks of approximately two-thirds of a pound to one-pound. Routine product sampling by BOAH revealed the presence of the bacterium that can cause illness ranging from mild to severe. For most people, salmonella causes diarrhea, stomach cramps, and fever. Blood or mucous may appear in the stool. The diarrhea and other symptoms usually begin 18-36 hours after exposure and may last 48 to 72 hours, but the person may carry salmonella in his body for weeks or months and be able to infect others. Rarely, salmonella can get into the blood and infect organs such as the heart, lungs, and bones. Death from salmonella is rare. Children under five, the elderly, and people with compromised immune systems, such as those with AIDS, are at the greatest risk for severe complications. For more details, contact Denise Derrer by Phone: 317-227-0308 INTERVOICE-BRITE INC.: Opposes Appeal of TX Stock Suit Dismissal ---------------------------------------------------------------- Plaintiffs responded to Intervoice-Brite, Inc.'s opposition to their appeal of the dismissal of the class action filed against the Company in the United States District Court for the Northern District of Texas, Dallas Division, styled "David Barrie, et al., on Behalf of Themselves and All Others Similarly Situated v. InterVoice-Brite, Inc., et al., No. 3-01CV1071-D." The consolidated suit was filed on behalf of purchasers of the common stock of the Company during the period from October 12, 1999 through June 6, 2000. Plaintiffs have filed claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Securities Exchange Act Rule 10b-5 against the Company as well as certain named current and former officers and directors of the Company on behalf of the alleged class members. In the complaint, Plaintiffs claim that the Company and the named current and former officers and directors issued false and misleading statements during the Class Period concerning the financial condition of the Company, the results of the Company's merger with Brite Voice Systems, Inc. and the alleged future business projections of the Company. Plaintiffs have asserted that these alleged statements resulted in artificially inflated stock prices. The Company responded to this complaint by filing a motion to dismiss the complaint in the consolidated proceeding. The Company asserted that the complaint lacked the degree of specificity and factual support to meet the pleading standards applicable to federal securities litigation. On this basis, the Company requested that the court dismiss the complaint in its entirety. On August 8, 2002, the Court entered an order granting the Company's motion to dismiss the class action lawsuit. In the order dismissing the lawsuit, the Court granted plaintiffs an opportunity to reinstate the lawsuit by filing an amended complaint. Plaintiffs filed an amended complaint on September 23, 2002. On September 15, 2003, the Court granted the Company's motion to dismiss the amended class action complaint. Unlike the Court's prior order dismissing the original class action complaint, the order dismissing the amended complaint did not grant Plaintiffs an opportunity to reinstate the lawsuit by filing a new amended complaint. On October 9, 2003, the Plaintiffs filed a notice of appeal to the Fifth Circuit Court of Appeals from the trial court's order of dismissal entered on September 15, 2003. The Plaintiffs filed their appellant brief on February 20, 2004, and the Company filed its brief in opposition to the Plaintiff's appeal on May 10, 2004. LANCER CORPORATION: Shareholders Lodge Securities Lawsuit in TX --------------------------------------------------------------- Lancer Corporation faces a purported securities class action filed in the United States District Court for the Western District of Texas by TDH Partners. The suit, cause number 04- CV-427, also names as defendants George F. Schroeder, David F. Green and The Coca-Cola Company. The action alleges that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Specifically, the complaint alleges that during the period October 26, 2000 to February 4, 2004, the defendants engaged in a pattern of fraudulent conduct involving the issuance of a series of false and misleading statements because they materially described inaccurately the nature of the Company's revenue, with a goal of manipulating the sales of fountain products. The action also alleges that the Company's public statements failed to fully reveal that it had major manufacturing problems, which resulted in a high defect rate in its products and that Lancer engaged in a fraudulent scheme with its largest customer, to artificially create demand for a new line of soda machine dispensers that Lancer was manufacturing for the customer to sell to its commercial customers. No specific amount of damages has been claimed. MARK NICHOLS: SEC Bars Representative Due To Unauthorized Trades ---------------------------------------------------------------- The Securities and Exchange Commission issued an order directing that Mark Jackson Nichols cease and desist from committing or causing any violations and any future violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and barring him from association with any broker, dealer or investment adviser pursuant to Section 15(b)(6) of the Exchange Act and Section 203(f) of the Investment Advisers Act of 1940. The order finds that Nichols, while employed as a registered representative in the Knoxville, Tennessee branch of a securities firm registered with the Commission as a broker- dealer and as an investment adviser, made a series of unauthorized trades in early 2000 in the accounts of several of his customers, causing substantial losses. The order further finds that, in violation of the rules of the New York Stock Exchange, the National Association of Securities Dealers and his employer, Nichols reimbursed one of his customers for losses the customers suffered as a result of Nichols's unauthorized trading. Nichols resigned from the broker-dealer in May 2000. The Commission did not impose a civil penalty on Nichols based on representations made in his Statement of Financial Condition and other documents. Nichols consented to the entry of the order and the relief imposed without admitting or denying the findings. NY STATE: Issues Warning Over Mayonnaise Due To Undeclared Eggs --------------------------------------------------------------- State Agriculture Commissioner Nathan L. Rudgers issued an alert to consumers who are sensitive to eggs not to consume "Uniservis Majonez Luksusowy" (Mayonnaise) sold by Royal Seafood International, Inc., d/b/a Net Cost Market, 2257 E. 16 th Street, Brooklyn, New York 11229 due to the presence of undeclared eggs. People who have allergies to eggs run the risk of serious or life-threatening allergic reactions if they consume these products. "Uniservis Majonez Luksusowy" is packaged in a 600-gram, glass jar with metal lid. The container code is 12 09 2004 PAR A. The product was sold in the Brooklyn, New York area. Routine sampling by New York State Department of Agriculture and Markets food inspectors revealed the product contained undeclared eggs. No illnesses have been reported to date in connection with this problem. Consumers who are allergic to eggs and have purchased "Uniservis Majonez Luksusowy" are urged to return them to the place of purchase. For more details, contact Jessica Chittenden by Phone: 518-457- 3136 TOWRY LAW: Investors Urged To Join Worldwide Stock Fraud Lawsuit ---------------------------------------------------------------- A retired finance executive is gathering disgruntled investors worldwide and urging them to take action against Towry Law International (TLI), the financial advice firm that they say wrongly sold them high-risk investment funds, The Asia Intelligence Wire reports. Losses are alleged to have run to several hundred million US dollars. TLI stands accused of selling several funds as "low- risk." David O'Hare, who lost savings when two of the geared-with- profits funds crashed, is visiting Hong Kong and will urge investors in the former British colony to join other groups around the world in launching a class-action lawsuit against TLI's then parent companies, HHG and AMP. Investors were hit by the A$80 million (HK$430.46 million) collapse of two Cayman Islands-registered funds, Global Diversified Trading and Global Opportunities. United Kingdom- based TLI is accused of selling the two hedge funds to investors in Hong Kong and the Middle East. Some investors are allegedly suffering severe difficulties following their losses. O'Hare, who now lives in Cyprus, told the Asia Intelligence Wire that: "I want to get things moving in Hong Kong because that's where the biggest investor base is." Howard Epstein, a lawyer at Class Law, a London law firm that specializes in actions of this kind, will also be with Mr. O'Hare. YUKOS OIL: Lerach Coughlin Lodges Shareholder Lawsuit in S.D. NY ---------------------------------------------------------------- The law firm Lerach Coughlin Stoia & Robbins (LCSR), acting on behalf of Yukos' foreign minority shareholders, initiated a class action suit in New York's Southern district court, the Vedomosti business daily reports. The defendants in this suit are Yukos Oil Company, Group Menatep and its co-owners Mikhail Khodorkovsky, Platon Lebedev and Vasily Shakhnovsky, as well a Yukos' CFO Bruce Misamore, the auditor PricewaterhouseCoopers and the little-known firm Curtis & Co, which is registered in Great Britain. All of the defendants are charged with creating a fraud scheme, which created a situation in which the majority of Yukos' foreign investors bought the company's shares at an inflated price. Attorney Sergei Sokolov, a partner at the Marks & Sokolov law firm, which provided consulting services to LCSR explained to Vedomosti that the suit may be joined by all of Yukos' shareholders who bought the oil company's securities in the period between February 13, 2003 and October 25, 2003. All of these people incurred serious losses after Mikhail Khodorkovsky's arrest, which happened on October 25. "The plaintiffs' representatives believe that all this time the management and co-owners of Yukos, as well as the company's auditor concealed the true state of affairs from the investors," Mr. Sokolov told the Vedomosti, adding that the sum of the claim will be determined later, and the leading plaintiff will be chosen in three months. Representatives of PricewaterhouseCoopers and Khodorkovsky's lawyer Anton Drel declined to comment on the situation. Vedomosti also reported that last Wednesday, June 30, that 12 investment funds which altogether manage more than $3 trillion and own approximately five percent of Yukos' shares sent a letter to President Vladimir Putin. The letter's authors told Putin that they were conscientious buyers of Yukos' shares and don't want to become the victims of a court battle between the state and the company's main shareholders. If the minority shareholders lose their investments as a result of the Yukos affair, says the letter, the protection of private property rights and of investors' rights in Russia will be placed in doubt. New Securities Fraud Cases 99 CENTS: Murray Frank Files Securities Fraud Lawsuit in C.D. CA ---------------------------------------------------------------- Murray, Frank & Sailer LLP announces that a class action lawsuit was filed in the United States District Court for the Central District of California on behalf of purchasers of 99 Cents Only Stores ("99 Cents") (NYSE:NDN) common stock during the period between March 11, 2004 and June 10, 2004 (the "Class Period"). The complaint charges 99 Cents and certain of its officers and directors with violations of the Securities Exchange Act of 1934. 99 Cents is a deep-discount retailer of primarily name brand and consumable general merchandise in the United States. As of March 12, 2004, the Company operated 194 retail stores with 150 in California, 19 in Texas, 15 in Arizona and 10 in Nevada.The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and prospects. As a result of the defendants' false statements, 99 Cents stock traded at artificially inflated prices during the Class Period, trading in the mid to high $20 range. According to the complaint, defendants concealed from the investing public that: (1) in order to inflate the Company's margins, especially to show success in the Company's newer markets, i.e., Texas, defendants created the appearance of profitability and success by, among other things, not accruing for proper expenses (the roll-out of the Company's advertising implementation and distribution costs); (2) the Company's margins were being eroded by a mix-shift tied to lower margin grocery items, freight costs, higher dairy costs, and a higher mark-down and shrink provision (up to $10 million); (3) the defendants had knowingly tolerated very weak internal controls; (4) the Company's inventory was artificially inflated and in fact, the Company had carried $10 million worth of deli products on its books as an asset when they were inedible due to expiration and other objective factors; (5) the Company's Southern California distribution center was in shambles; (6) the Company's workers' compensation problems were far from over and, in fact, contrary to declining, defendants had forecast these expenses as increasing; and (7) as a result of the above, the Company was not on track to achieve EPS for Q2 04 of $0.19-$0.20. For more details, contact Eric J. Belfi or Aaron D. Patton of Murray, Frank & Sailer LLP by Phone: (800) 497-8076 or (212) 682-1818 by Fax: (212) 682-1892 by E-mail: info@murrayfrank.com or visit their Web site: http://www.murrayfrank.com/cases.htm ALLIANCE GAMING: Marc Henzel Lodges Securities Suit in NV Court --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Nevada on behalf of all purchasers of the common stock of Alliance Gaming Corporation (NYSE: AGI) from January 15, 2004 through June 7, 2004, inclusive. The complaint charges that Alliance, Robert L. Miodunski, Robert L. Saxton, Steven Des Champs, and Mark Lerner violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between January 15, 2004 and June 7, 2004, about the Company's financial condition thereby artificially inflating the price of Alliance's shares. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company was struggling to hold shares in key markets, driven by relatively weaker content and software platform weakness; (2) that the Company's yields on participation games were contracting due to the waning popularity of flagship games, which conversely resulted higher R&D expenses for the development of traditional and central determination products; (3) that the Company was suffering from slower deployment of Wide Area Progressive games in the Nevada market due to regulatory delays, languishing approval and deployment of new game revisions in the New York Lottery market, and substantial reductions in new game orders; (4) the Company was experiencing massive integration issues related to the Sierra Design Group acquisition; and (5) that, as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the Company and their earnings projections. On June 8, 2004, Alliance announced revised earnings guidance for fiscal year 2004 and 2005. News of this shocked the market. Shares of Alliance fell $5.24 or 24.50 percent on June 8, 2004, to close at $16.15. 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 or by E-Mail: mhenzel182@aol.com ALLOS THERAPEUTICS: Marc Henzel Lodges Securities Lawsuit in CO --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United Stated District Court for the District of Colorado, on behalf of persons who purchased or otherwise acquired publicly traded securities of Allos Therapeutics Inc. (NASDAQ:ALTH) between May 29, 2003 and May 3, 2004, inclusive. The lawsuit was filed against Allos and Michael Hart. 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. Specifically the complaint alleges that Allos misled the investing public by issuing a series of materially false and misleading statements highlighting the purported efficacy of the Company's radiation sensitizer RSR13 ("Efaproxiral") for the treatment of brain metastases in patients with breast cancer, as well as the likelihood that this drug would receive approval from the U.S. Food and Drug Administration ("FDA"). On April 30, 2004 and May 3, 2004, it was announced by the Oncologic Drugs Advisory Committee ("ODAC") of the FDA, that it concluded by a 16-1 vote, to recommend that the FDA not approve Efaproxiral. In recommending rejection of Efaproxiral, the ODAC found that "the evidence of drug efficacy needs to be much stronger to be convincing." As a result of this announcement, the price of Allos shares fell $2.09, or 45% to close at $2.55 on extraordinary volume. 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 or by E-Mail: mhenzel182@aol.com ASCONI CORPORATION: Marc Henzel Lodges Securities Lawsuit in FL --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United Stated District Court for the Middle District of Florida on behalf of behalf of all persons who purchased the securities of Asconi Corp. (AMEX: ACD) in the period from May 15, 2003 to March 23, 2004. The complaint alleges that the defendants made material misrepresentations and omissions of material facts concerning the company's business performance during the relevant time. According to the complaint, throughout the relevant time period, defendants misrepresented the financial condition of the Asconi and failed to disclose certain related party transactions, thereby overstating the financial condition of Asconi. The company has delayed the filing of its annual Report on Form 10-K with the SEC, its stock price has collapsed and the stock has ceased trading. 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 or by E-Mail: mhenzel182@aol.com BEA SYSTEMS: Schatz & Nobel Lodges Securities Lawsuit in N.D. CA ---------------------------------------------------------------- The law firm of Schatz & Nobel, P.C. initiated a lawsuit seeking class action status in the United States District Court for the Northern District of California on behalf of all persons who purchased the publicly traded securities of BEA Systems, Inc. (Nasdaq: BEAS) ("BEA") between November 13, 2003 and May 13, 2004, inclusive (the "Class Period"). The Complaint alleges that BEA, a provider of application infrastructure software, and certain of its officers and directors issued materially false statements concerning BEA's business condition. Specifically, defendants failed to disclose that: (1) BEA was experiencing material sales execution problems in its licensing division, resulting in license reserve being down in the comparable quarter and the sequential quarter; (2) that during the preceding quarter, BEA's sales staff and management were attempting to reorganize; however, in so doing, BEA's sales were disrupted; (3) BEA's WebLogic 8.1 Platform was far from "revolutionary" and was not selling as defendants had claimed; (4) coverage of small and medium-size businesses was transferred to the General Accounts Team which, disrupted the Company's North American reserves; and (5) BEA was experiencing weakness, not strength, in its telecom vertical business. On May 13, 2004, BEA announced disappointing first quarter results, citing the difficult sales environment and sales execution issues. On this news, shares of BEA plummeted 30% to $8.00 per share. For more details, contact Nancy A. Kulesa of Schatz & Nobel by Phone: (800) 797-5499 or by e-mail: sn06106@aol.com or visit their Web site: www.snlaw.net BEA SYSTEMS: Charles J. Piven Lodges Securities Suit in N.D. CA --------------------------------------------------------------- The Law Offices Of Charles J. Piven, P.A. has commenced a securities class action on behalf of shareholders who purchased, converted, exchanged or otherwise acquired the common stock of BEA Systems, Inc. (Nasdaq:BEAS) between November 13, 2003 and May 13, 2004, inclusive (the "Class Period"). The case is pending in the United States District Court for the Northern District of California against defendant BEA and one or more of its officers and/or 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. No class has yet been certified in the above action. For more details, contact the Law Offices Of Charles J. Piven, P.A. 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 CANADIAN SUPERIOR: Marc Henzel Lodges Securities Suit in S.D. NY ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Southern District of New York on behalf of purchasers of the securities of Canadian Superior Energy Inc. (Amex: SNG) between November 17, 2003 and March 11, 2004, inclusive. The complaint charges Canadian Superior, Greg Noval, and Michael Coolen with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. More specifically, the Complaint alleges that defendants issued a number of materially false and misleading statements about its El Paso Mariner I-85 well offshore operations in Nova Scotia, Canada. These positive statements failed to disclose and indicate: (1) that defendants knew or were reckless in not knowing that the "Mariner \ I-85 well" was virtually "dry"; (2) that the actual costs of testing and drilling at the well were significantly exceeding the budgeted costs; (3) that a significant gas reservoir to support a commercial project did not exist; (4) that, as a result of the foregoing, the Company's positive announcements concerning the "Mariner I-85 well" were lacking in a reasonable basis when made, and (5) that the defendants' positive statements only served to artificially inflate the value of its stock. The Company shocked the market with its March 11, 2004 announcement that it had halted operations at the El Paso Mariner I-85 well in the Atlantic Ocean off Nova Scotia, following 3-1/2 months of drilling. On this news, shares of Canadian Superior skidded 44.44%, or $1.44 per share, to close at $1.80 per share on March 11, 2004 on unusual high volume. 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 or by E-Mail: mhenzel182@aol.com CARDINAL HEALTH: Scott + Scott To Lodge Securities Lawsuit in OH ---------------------------------------------------------------- The law firm of Scott + Scott, LLC will initiate a class action in the United States District Court for the Southern District of Ohio on behalf of the purchasers of Cardinal Health, Inc. ("Cardinal") (NYSE: CAH) securities between the period of October 24, 2000 and June 30, 2004, inclusive (the "Class Period"). Plaintiffs will allege that during this period, that Cardinal and certain of its officers and directors were in violation of the United States Federal securities laws (Securities Exchange Act of 1934). The complaint to be filed alleges that during the Class Period, Cardinal Health failed to record, on a timely basis, litigation claims it owed, causing its earnings and assets to be artificially inflated. The Company also misclassified non- operating revenues as operating, giving a misleading picture of the Company to investors. It is also alleged that Cardinal improperly accounted for the $22 million recovered from vitamin makers accused of overcharging Cardinal by booking such recoveries as revenue when the antitrust cases had not been resolved. Further, it is alleged that defendants made misleading, materially incomplete statements to investors about its transition to a fee-for-service model of drug distribution. Cardinal has announced that on June 21, it received a subpoena from the U.S. Securities and Exchange Commission in connection with the SEC's formal investigation announced on May 14. For more details, contact Neil Rothstein of Scott + Scott, LLC by Mail: 108 Norwich Avenue, Colchester, CT 06415 by Phone: 1/800-404-7770 (EDT) or 1/800-332-2259 (PDT) or 1/619-233-4565 (California) or 860/537-3818 by Fax: 860/537-4432 or by E-mail: CardinalHealthSecuritiesLitigation@scott-scott.com or nrothstein@scott-scott.com CARDINAL HEALTH: Marc Henzel Lodges Securities Suit in S.D. OH -------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Southern District of Ohio on behalf of all purchasers of the common stock of Cardinal Health, Inc. (NYSE: CAH) from October 24, 2000 through June 30, 2004 inclusive. The complaint charges that Cardinal, Robert D. Walter, and Richard J. Miller violated the Securities Exchange Act of 1934. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company manipulated various aspects of its accounting practices to continuously portray profitability to market; (2) that the Company held inventory for an average of two months, and reaped exorbitant profits from price inflation; (3) that the Company improperly accounted for the $22 million recovered from Vitamin makers accused of overcharging Cardinal by booking such recoveries as revenue when the antitrust cases had not been resolved; (4) that the Company's pharmaceutical distribution business improperly classified revenues by reporting the revenues as either operating revenue or revenues form bulk deliveries to consumer warehouses when revenues were not derived from such; (5) that as a consequence of the aforementioned practices, the Company's financial results were in violation of Generally Accepted Accounting Principles ("GAAP") and the Company's own accounting interpretations on revenue recognition; (6) that the Company lacked adequate internal controls; and (7) that the Company's earnings per share were materially inflated; and (8) that as a result of the above, the Company's financial results were inflated at all relevant times. On June 30, 2004, Cardinal announced earnings per share for its fiscal year 2004 are expected to increase approximately 11 percent, which is below prior guidance of mid-teens or better growth. Separately, the company announced that on June 21, as part of the Securities and Exchange Commission's (SEC) formal investigation disclosed by the company on May 14, it received an SEC subpoena. In addition, Cardinal Health has learned that the U.S. Attorney's Office for the Southern District of New York has commenced an inquiry that the company understands relates to this same subject. News of this shocked the market. Shares of Cardinal fell $17.19 per share or 24.54 percent on July 1, 2004 to close at $52.86 per share. More than 35.5 million Cardinal shares were traded, more than 15 times the three-month daily average. 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 or by E-Mail: mhenzel182@aol.com HANGER ORTHOPEDIC: Marc Henzel Lodges Securities Suit in E.D. VA ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Eastern District of Virginia on behalf of purchasers of Hanger Orthopedic Group, Inc. (NYSE: HGR) common stock during the period between February 26, 2003 and June 14, 2004. The complaint charges Hanger Orthopedic and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Hanger Orthopedic owns and operates orthotic and prosthetic patient-care centers in the United States. The complaint alleges that during the Class Period, defendants caused Hanger Orthopedic's shares to trade at artificially inflated levels through the issuance of false and misleading financial statements. As a result of this inflation, defendants were able to sell 167,270 Hanger Orthopedic shares, reaping insider trading proceeds of $2.4 million. On June 14, 2004, an investigative report on WNBC television charged that Hanger Orthopedic "may have improperly booked sales by filling out fake prescriptions." According to the report, Hanger Orthopedic recorded sales for patients that did not exist and added items that were not prescribed to existing patients in order to increase bills to Medicaid and Medicare. The report also said Hanger Orthopedic submitted forged prescriptions using a blank prescription pad. The stock dropped to below $12 per share on this news. On June 18, 2004, the Company issued a press release in which it announced "developments relating to previously announced allegations in the press concerning possible billing improprieties. ... The allegations included claims by an employee ... that one of the clinicians was signing doctors' signatures on prescription forms." The release also stated that "(o)n June 17, 2004, the Company received a subpoena from the U.S. Attorney's Office for the Eastern District of New York requesting that the Company produce documents relating to these allegations .... The SEC also has requested information from the Company relating to the allegations." 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 or by E-Mail: mhenzel182@aol.com HIBERNIA FOODS: Weiss & Yourman Files Securities Suit in S.D. NY ---------------------------------------------------------------- The law firm of Weiss & Yourman has initiated a class action lawsuit against Hibernia Foods PLC ("Hibernia" or the "Company") (OTC:HIBNY.PK) and its officers in the United States District Court, Southern District of New York, on behalf of purchasers of Hibernia securities. The complaint charges the defendants with violations of the Securities Exchange Act of 1934, alleging that defendants issued false and misleading statements during the Class Period. This action seeks to recover damages on behalf of defrauded investors who purchased Hibernia securities. For more details, David C. Katz, James E. Tullman, or Mark D. Smilow by Mail: The French Building, 551 Fifth Avenue, Suite 1600, New York, New York 10176 by Phone: 001-212-682-3025 by E- mail: info@wynyc.com KEY ENERGY: Murray Frank Lodges Securities Fraud Suit in W.D. TX ---------------------------------------------------------------- The law firm of Murray, Frank & Sailer LLP initiated a class action lawsuit in the United States District Court for the Western District of Texas on behalf of purchasers of Key Energy Services, Inc. ("Key Energy") (NYSE:KEG) publicly traded securities during the period between April 29, 2003 and June 4, 2004 (the "Class Period"). The complaint charges Key Energy and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Key Energy is the world's largest rig-based, onshore well service company. The Company provides diversified energy operations, including well servicing, contract drilling, pressure pumping, fishing and rental tool services and other oilfield services. The complaint alleges that during the Class Period, defendants misrepresented the strength of Key Energy's financial results. Throughout the Class Period, defendants repeatedly stated that Key Energy's financials were strong and improving and that it had strengthened its competitive position to benefit once market conditions improved. In fact, the Company's financial statements were materially misstated and not nearly as favorable as reported. As a result of defendants' misstatements, Key Energy's securities traded at artificially inflated levels. Defendants were thus able to complete a $150 million note offering in May 2003 and to exchange 542,477 shares of Key Energy stock in the acquisition of Lea Fishing Tools, Inc. in September 2003. On March 15, 2004, Key Energy announced it would delay filing its 2003 Form 10-K so that it could review the classification of fixed assets during 2003. Later, on March 29, 2004, Key Energy announced it would be taking write-downs of $83 million to reflect good will impairment and would restate its prior year's financial statements.Then on June 7, 2004, before the market opened, Key Energy announced it was withdrawing earnings guidance for 2004. The Company also disclosed that if it failed to obtain a waiver for its default on its senior notes, it would be in default. On this news, the Company's stock collapsed to as low as $7.00 per share before closing at $8.67 on volume of 13.9 million shares. This was a 37% drop from the Class Period high of $13.96. For more details, contact Eric J. Belfi or Aaron D. Patton of Murray, Frank & Sailer LLP by Phone: (800) 497-8076 or (212) 682-1818 by Fax: (212) 682-1892 by E-mail: info@murrayfrank.com or visit their Web site: http://www.murrayfrank.com/cases.htm KEY ENERGY: Marc Henzel Lodges Securities Fraud Suit in W.D. TX --------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the Western District of Texas on behalf of purchasers of the securities of Key Energy Services, Inc. (NYSE: KEG) between April 29, 2003 and June 4, 2004, inclusive, (the "Class Period"), seeking to pursue remedies under the Securities Exchange Act of 1934. The action, is pending against defendants Key and Key directors and/or officers Richard J. Alario, James J. Byerlotzer, Francis D. John and Royce Mitchell. The complaint alleges that during the Class Period, defendants' publicly disseminated results of Key's operations and financial condition contained artificially inflated revenues, assets and income. Such results were not prepared or reported in accordance with Generally Accepted Accounting Principles and deceived investors as to the Company's true performance, thereby artificially inflating the price of Key securities during the Class Period. The truth began to emerge on March 15, 2004. On that date, the Company announced that that it would not meet the Securities and Exchange Commission deadline for filing its annual report because it had yet to complete its review of "certain idle equipment" with a book value of $55 million, and that the review might result in "a revision to the 2003 earnings." The Company maintained, however, that, "the underlying fundamentals of the Company are strong and the outlook remains positive." The next two months were punctuated by a series of additional disclosures, each of which further depressed Key's stock price. The Class period ends June 4, 2004. The morning of the next trading day, June 7, 2004, before the market opened, defendants announced that they were "withdrawing all previous earnings forecasts of operating results for 2004," that they were doing so "in light of current uncertainties affecting the Company," and that they had received notice from the indenture trustee of its 6.375% and 8.375% senior Notes that the Company was in default and had 90 days to cure the default. On this news, the price of Key shares plummeted on extremely high trading volume of 13,963,900 shares. Key shares had closed at $9.62 on June 4, 2004. On June 7, 2004 they reached an intra- day low of $7.00, down 27%, before rebounding to close the day at $8.67. 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 or by E-Mail: mhenzel182@aol.com KRISPY KREME: Chimicles & Tikellis Files Securities Suit in NC -------------------------------------------------------------- The law firm of Chimicles & Tikellis LLP initiated a securities class action lawsuit in the United States District Court for the Middle District of North Carolina, against Krispy Kreme Doughnuts, Inc., ("Krispy Kreme" or the "Company") (NYSE: KKD), Scott Livengood (President, Chief Executive Officer and Chairman), Michael Phalen (Chief Financial Officer), Randy S. Casstevens (Former Chief Financial Officer) and John Tate (Chief Operating Officer) on behalf of all purchasers of the common stock of Krispy Kreme between August 21, 2003 through May 7, 2004, inclusive (the "Class Period"). The Complaint alleges that defendants violated the federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, by issuing materially false and misleading statements contained in press releases and filings with the Securities and Exchange Commission during the Class Period. Specifically, the Complaint alleges, among other things, that the Company failed to disclose and misrepresented the following material adverse facts, about the Company's poor performance, which were known to defendants or recklessly disregarded by them: (1) Its business model and strategy for increasing sales was predicated on the perpetual addition of new stores and the hyping of the Company's entry into new markets, a tactic that resulted in unsustainable surges in sales that fell off once the hype ceased and the novelty of the new store wore off; (2) the Company's wholesale business was more expensive to operate and, therefore, resulted in a lower profit margin than in-store sales; (3) the Company's wholesale business was saturating the market with Krispy Kreme products, cannibalizing the company's retail operations, perhaps undermining them as well, and decreasing the Company's overall profit margin; (4) The Company repurchased several franchises, which were characterized to investors as repurchases that were all part of Krispy Kreme's "acquisition strategy" when, in fact, such repurchases were to prevent franchisees from closing the stores, because this would damage Krispy Kreme's reputation for ever-increasing growth, and as part of a scheme to wipe franchisee accounts receivable off its books; and (5) As a result of certain transactions, Krispy Kreme consolidated money-making joint ventures into its financial statements, thereby causing its earnings to be, in part, misleading. On May 7, 2004, the day the Class Period ends, Krispy Kreme announced that "it expects fiscal 2005 diluted earnings per share from continuing operations, excluding certain charges, to be 10% lower than previously announced guidance." The Company blamed their lackluster results on the so-called low- carbohydrate ("low-carb") diet trend. As a result of this disclosure, shares of Krispy Kreme fell $9.29 per share or nearly 30% on May 7, 2004 to close at $22.51 per share. This May 7, 2004 attribution by defendants for Krispy Kreme's financial results and prospects was false and misleading, as defendants knew or recklessly disregarded that the trend toward low-fat, low- carb diet was not the sole, or even a significant, reason for the Company's worsening financial condition. Defendants merely and conveniently used media attention to low-carb diets as an opportune ruse to obscure the prior false and misleading public statements regarding Krispy Kreme's store results, same store sales, acquisitions and growth rates. For more details, contact Nicholas E. Chimicles or Kimberly M. Donaldson of Chimicles & Tikellis LLP by Mail: 361 West Lancaster Avenue, Haverford, PA 19041 by Phone: 610-642-8500 or 888-805-7848 by Fax: 610-649-3633 by E-Mail: mail@chimicles.com or visit their Web site: http://www.chimicles.com LANCER CORPORATION: Marc Henzel Files Securities Suit in W.D. TX ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action lawsuit was filed in the United Stated District Court for the Western District of Texas, on behalf of persons who purchased or otherwise acquired publicly traded securities of Lancer Corporation (AMEX: LAN) between October 26, 2000 and February 4, 2004, inclusive, (the "Class Period"). The lawsuit was filed against Lancer and George F. Schroeder, David F. Green and the Coca-Cola Company (NYSE: KO). 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. Specifically, the complaint alleges that during the Class Period, Defendants engaged in a pattern of fraudulent conduct involving the issuance of a series of false and misleading statements. The complaint additionally alleges that these statements were materially false and misleading because they materially described inaccurately the nature of Lancer's revenue by saying it was derived from legitimate business transactions, when in reality, substantial revenues were derived as a result of a scheme to artificially set the sales prices of Lancer's products to its customers. The goal of the scheme, the complaint further asserts, was to manipulate the sales of fountain products. In addition, the complaint alleges that Lancer's public statements failed to fully reveal that it had major manufacturing problems, which resulted in a high defect rate in its products. Lastly, the complaint alleges that Lancer engaged in a fraudulent scheme with its largest customer, Coca-Cola Co. to artificially create demand for a new line of soda machine dispensers that Lancer was manufacturing for Coca-Cola to sell to its commercial customers. On January 14, 2004, Lancer announced that the Securities & Exchange Commission had launched a formal investigation into Lancer's reporting of its financial statements, revenue and cost recognition, and internal financial and accounting controls. On February 2, 2004, Lancer announced that the Company's longstanding auditor KPMG LLP ("KPMG"), had resigned. Lancer also disclosed that KPMG indicated that the reason for its resignation was that Lancer had not taken timely and appropriate remedial actions with respect to "likely illegal acts." KPMG's comments were in stark contrast to Lancer's statements on January 30, 2004, that its audit committee did not find sufficient evidence of "intentional misconduct" or "accounting irregularities." Trading of Lancer shares has been halted since February 2, 2004. When and if trading resumes, it is virtually certain that Lancer common stock will trade far below the $7.50 trading price at which it was halted. 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 or by E-Mail: mhenzel182@aol.com LEHMAN ABS: Abbey Gardy Lodges Securities Fraud Suit in S.D. NY --------------------------------------------------------------- The Law Offices of Abbey Gardy, LLP initiated a class action lawsuit in the United States District Court for the Southern District of New York on behalf of all purchasers of Corporate Backed Trust Certificates, Verizon New York Debenture-Backed Series 2004-1 (NYSE: JZG) ("Certificates") between January 5, 2004 and May 11 2004, inclusive (the "Class Period"). The Complaint alleges that defendants Lehman ABS Corp., U.S. Bank Trust National Association, Corporate Backed Trust Certificates Verizon New York Debenture-Backed Series 2004-1 Trust, Lehman Brothers Inc., RBC Dain Rauscher And Banc Of America Securities LLC violated Sections 11 and 15 of the Securities Act of 1933. The Complaint alleges that the Prospectus was materially misleading because it omitted to state material information that defendants had an obligation to disclose. Verizon New York was 1 of 16 domestic operating company owned by Verizon that filed reports with the SEC. While the Prospectus generally described Verizon's failure to continue as an SEC filer as one of the potential events of default, it failed to disclose that, as of February 2003, Verizon had already deregistered the public indebtedness of six of its domestic operating telephone companies (GTE Southwest Inc., Verizon Delaware Inc., Verizon Hawaii Inc., Verizon Northwest Inc., Verizon Washington DC Inc. and Verizon West Virginia Inc.), and that those deregistrations were made pursuant to a program Verizon had established in early 2003 to change funding procedures and reduce costs, which plan included possible deregistration of domestic operating telephone companies with public indebtedness, including Verizon New York. This information was material to an investor's decision whether to purchase the Certificates, particularly in light of the fact that a sale of the Debentures in the open market could yield substantially less than the $25 per Certificate paid by the Class members. For more details, contact Nancy Kaboolian, Esq. of Abbey Gardy, LLP by Phone: (212) 889-3700 or (800) 889-3701 or by E-mail: Nkaboolian@AbbeyGardy.com MERIX CORPORATION: Marc Henzel Files Securities Fraud Suit in OR ---------------------------------------------------------------- The Law Offices of Marc S. Henzel initiated a securities class action in the United States District Court for the District of Oregon on behalf of all purchasers of the common stock of Merix Corporation (Nasdaq: MERX) from July 1, 2003 through May 13, 2004, inclusive (the "Class Period"). The complaint charges Merix, Mark Hollinger and Jamie S. Brown with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants failed to disclose or indicate the following: (1) that the Company over relied, in their financial projections, on the customers' future demand for premium-priced and reduced-lead-time products, which had previously accounted for 50% of the Company sales; (2) that the Company failed to adequately insulate itself from the softening demand, specifically with regard to supply needs of a major networking customer; (3) that the Company failed to appreciate the market conditions, which did not support the Company's aggressive growth; and (4) that, as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the Company and their earnings projections. On May 13, 2004, after the close of the market, Merix revised guidance for the fourth quarter of fiscal 2004, ending May 29, 2004. News of this shocked the market. Shares of Merix fell $4.64 per share or 30.29 percent on May 14, 2004, to close at $10.68 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 or by E-Mail: mhenzel182@aol.com SHAW GROUP: Brodsky & Smith Lodges Securities Lawsuit in E.D. LA ---------------------------------------------------------------- The law offices of Brodsky & Smith, LLC initiated a securities class action lawsuit on behalf of shareholders who purchased the common stock and other securities of The Shaw Group, Inc. ("Shaw Group" or the "Company") (NYSE:SGR), between October 19, 2000 and June 10, 2004, inclusive (the "Class Period"). The class action lawsuit was filed in the United States District Court for the Eastern District of Louisiana. 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 the stock. No class has yet been certified in the above action. For more details, contact Marc L. Ackerman, Esq. or Evan J. Smith, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004 by Phone: 877-LEGAL-90 by E- mail: clients@brodsky-smith.com SIEBEL SYSTEMS: Marc Henzel Lodges 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 Siebel Systems, Inc. (Nasdaq: SEBL)publicly traded securities during the period between October 1, 2001 and July 17, 2002, inclusive (the "Class Period"). The complaint charges Siebel Systems and certain of its officers and directors with violations of the Securities Exchange Act of 1934 (the "Exchange Act"). The complaint alleges that during the Class Period, defendants issued false and misleading statements to the marketplace that artificially inflated the price of Siebel Systems shares. In particular, the Company misrepresented its business and future prospects by overstating customer acceptance of its new product offerings -- including Siebel 7 CRM -- and failed to disclose that "independent" customer satisfaction surveys which persuaded investors that a vast majority of the Company's customers would purchase products from the Company in the future were in fact carried out by an affiliated company and could not be relied upon. On July 17, 2002, Siebel announced its second quarter June 30, 2002 earnings reporting a precipitous drop in revenues of more than 15% and a 33% shortfall in earnings compared to consensus analyst forecasts. The Company also confirmed the continuing slide in demand for Siebel Systems' products by slashing revenue forecasts for the remainder of 2002 by an additional 25% -- or $600,000,000 below guidance provided by defendants just six months prior. In unusually heavy volume of 65 million shares traded, Siebel Systems share prices dropped $2.13 on July 18 to close at $9.61. 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 or by E-Mail: mhenzel182@aol.com SYNOVIS LIFE: Brodsky & Smith Commences Securities Lawsuit in MN ---------------------------------------------------------------- The law offices of Brodsky & Smith, LLC initiated a securities class action lawsuit on behalf of shareholders who purchased the common stock and other securities of Synovis Life Technologies, Inc. ("Synovis" or the "Company") (Nasdaq:SYNO), between October 16, 2003 and May 18, 2004, inclusive (the "Class Period"). The class action lawsuit was filed in the United States District Court for the District of Minnesota. 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 the stock. No class has yet been certified in the above action. For more details, contact Marc L. Ackerman, Esq. or Evan J. Smith, Esq. of Brodsky & Smith, LLC by Mail: Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004 by Phone: 877-LEGAL-90 by E- mail: clients@brodsky-smith.com ********* A list of Meetings, Conferences and Seminars appears in each 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. ********* 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., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Glenn Ruel Se�orin, Aurora Fatima Antonio and Lyndsey Resnick, Editors. Copyright 2004. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *