/raid1/www/Hosts/bankrupt/CAR_Public/050418.mbx
C L A S S A C T I O N R E P O R T E R
Monday, April 18, 2005, Vol. 7, No. 75
Headlines
7 MARKET PLACE: Recalls Chocolate Sticks Due To Undeclared Milk
AKAMAI TECHNOLOGIES: NY Court Preliminarily OKs Suit Settlement
AQUANTIVE INC.: NY Court Preliminarily Approves Suit Settlement
ART TECHNOLOGY: MA Court Yet To Rule on Summary Judgment Motion
AXONYX INC.: Shareholders Lodge Securities Fraud Suit in S.D. NY
BAJA PRODUCTS: Recalls 145T Activity Sets Due To Choking Hazard
BLOCKBUSTER INC.: Seeks To Move OR Woman's Suit To Federal Court
CROMPTON CORPORATION: PA Residents Commence Toxic Tort Lawsuit
FEDERATED DEPARTMENT: NY Judge Dismisses Securities Fraud Case
FRANCE: Consumer Association Pushes For U.S.-Style Class Actions
GENTEK INC.: Mediation in CA Injury Suit Set For April 26,2005
GOLD BANC: Farm Borrowers Refile Dismissed Lawsuit In OK Court
HOOVER CO.: Recalls 636,000 Vacuum Cleaners Due To Fire Hazard
INSIGHT COMMUNICATIONS: Shareholders File 4 Fiduciary Duty Suits
INTERMUNE INC.: CA Court To Hear Motion To Dismiss Stock Lawsuit
INTERNET CAPITAL: NY Court Preliminarily Okays Suit Settlement
IVILLAGE INC.: NY Court Preliminarily Approves Suit Settlement
JUPITERMEDIA CORPORATION: Blocks Gambling-Related Ads on Search
KENTUCKY FUND: Suit Launched Over Handling of Settlement Balance
LABRANCHE & CO.: Plaintiffs File NY Consolidated Securities Suit
LABRANCHE & CO.: Faces Consolidated Securities Fraud Suit in NY
LABRANCHE & CO.: Plaintiff Withdraws NY Specialist Trading Suit
LOUISIANA: Court Rules That State Must Pay For Indigent Defense
MARTHA STEWART: Working To Settle Securities, Derivative Suits
MCCOWN DELEEUW: Ex-Employees Launch Suit Over Mass Layoffs in ID
MERCEDES-BENZ USA: NJ Judge Rules Area Dealers Are Class Members
MISSISSIPPI: Judge Sets Status Hearing For NMHS Settlement Talks
NAPOLI KAISER: NY Judge Dismisses Suit Over Fen-Phen Settlement
NEXTEL PARTNERS: NY Court Preliminarily Approves Suit Settlement
NEXTEL PARTNERS: Appeal of Wireless Phone Suit Dismissal Heard
NEXTEL PARTNERS: Appeals Court Affirms Securities Suit Dismissal
NEXTEL PARTNERS: Shareholders Launch Fraud Suit V. Sprint Merger
PRIMUS KNOWLEDGE: NY Court Preliminarily Okays Suit Settlement
RAZORFISH INC.: NY Court Preliminarily Approves Suit Settlement
RIDLEY INC.: Faces Suits Over BSE Crisis, Expects More To Come
SEQUENOM INC.: NY Court Preliminarily Approves Suit Settlement
SPECTRASITE BUILDING: Plaintiffs Appeal Antitrust Suit Dismissal
THESTREET.COM: NY Court Preliminarily Approves Suit Settlement
TREX CO.: NJ Court Approves Settlement of Consumer Fraud Lawsuit
UNITED STATES: Canadian Group Promises Damages Lawsuit V. R-CALF
UNITED STATES: Court OKs $21.9M Payment to Holocaust Survivor
WAL-MART STORES: Recalls 220T Recorders Due To Poison Hazard
WASHINGTON: Judge Grants Certification To WA Workers' Lawsuit
ZEBCO HOLDINGS: Recalls 1.5M Fishing Poles Due To Injury Hazard
ZIYAD BROTHER: Recalls Tahini Due To Salmonella Contamination
New Securities Fraud Cases
BLUE COAT: Berman DeValerio Lodges Securities Fraud Suit in CA
COLLINS & AIKMAN: Federman & Sherwood Lodges Stock Lawsuit in MI
VEECO INSTRUMENTS: Goodkind Labaton Lodges Amended NY Stock Suit
WATCHGUARD TECHNOLOGIES: Marc S. Henzel Lodges Stock Suit in WA
*********
7 MARKET PLACE: Recalls Chocolate Sticks Due To Undeclared Milk
---------------------------------------------------------------
State Agriculture Commissioner Nathan L. Rudgers alerted
consumers that 7 Market Place, Inc., d/b/a 7 Market Place, 707
2nd Avenue, New York, New York 10016 is recalling 2 oz. packages
of "Pocky Chocolate Sticks" due to an undeclared milk
ingredient. People who have allergies to milk may run the risk
of serious or life-threatening allergic reactions if they
consume this product.
The recalled "Pocky Chocolate Sticks" coded 2005 4 PSR 2 B/8
come in a sealed paper box. It was sold in the New York City
area.
The problem was discovered as a result of routine sampling by
New York State Department of Agriculture and Markets Food
Inspectors and subsequent analysis by the Department's Food
Laboratory personnel revealed the presence of a milk ingredient
in product packages which did not declare a milk ingredient on
the label. No illnesses have been reported to date to this
Department in connection with the problem.
Consumers who have purchased "Pocky Chocolate Sticks" should
return it to the place of purchase.
AKAMAI TECHNOLOGIES: NY Court Preliminarily OKs Suit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action field against Akamai
Technologies, Inc., certain of its officers and directors and
the the underwriters of its October 28, 1999 initial public
offering of common stock.
Between July 2, 2001 and November 7, 2001, purported class
action lawsuits seeking monetary damages were filed on behalf of
persons who purchased the Company's common stock during
different time periods, all beginning on October 28, 1999 and
ending on various dates. The complaints are similar and allege
violations of the Securities Act of 1933 and the Exchange Act
primarily based on the allegation that the underwriters received
undisclosed compensation in connection with the Company's
initial public offering.
On April 19, 2002, a single consolidated amended complaint was
filed, reiterating in one pleading the allegations contained in
the previously filed separate actions. The consolidated amended
complaint defines the alleged class period as October 28, 1999
through December 6, 2000. A Special Litigation Committee of the
Company's Board of Directors authorized management to negotiate
a settlement of the pending claims substantially consistent with
a Memorandum of Understanding that was negotiated among class
plaintiffs, all issuer defendants and their insurers. The
parties negotiated a settlement, subject to Court approval. On
February 15, 2005, the Court issued an Opinion and Order
preliminarily approving the settlement, provided that the
defendants and plaintiffs agree to a modification narrowing the
scope of the bar order set forth in the original settlement
agreement.
AQUANTIVE INC.: NY Court Preliminarily Approves Suit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against aQuantive,
Inc. (formerly Avenue A, Inc.), styled "In re Avenue A, Inc.
Initial Public Offering Securities Litigation.
This consolidated complaint relates to several previously filed
class action complaints against the Company, the first of which
was originally filed on June 15, 2001. Plaintiffs filed the
consolidated complaint on behalf of themselves and all others
who acquired the Company's common stock between February 28,
2000 and December 6, 2000, pursuant or traceable to the
Company's prospectus dated February 28, 2000. The complaint
also named as defendants:
(1) Morgan Stanley & Co.,
(2) Salomon Smith Barney, Inc.,
(3) Thomas Weisel Partners, LLC, and
(4) RBC Dain Rauscher, Inc.,
(5) Brian P. McAndrews, President and Chief Executive
Officer;
(6) Nicolas Hanauer, Chairman of the Board; and
(7) Robert Littauer, former Chief Financial Officer
The complaint claims violations of of 15 U.S.C. 77k (Section 11
of the Securities Act of 1933), and violation of 15 U.S.C.
78j(b) (Section 10(b) of the Securities Exchange Act of 1934)
and 17 C.F.R. 240.10b-5 (Exchange Act Rule 10b-5) against all
defendants. The complaint allege violation of 15 U.S.C. 77o
(Section 15 of the Securities Act of 1933) and violation of 15
U.S.C. 78t(a) (Section 20(a) of the Securities Exchange Act of
1934) against the individual defendants. Plaintiffs seek
monetary damages.
The complaint alleges violations of federal securities laws in
connection with disclosures contained in the Company's
prospectus dated February 28, 2000, for its initial public
offering of common stock. The complaint alleges incorrect
disclosure or omissions in the Company's prospectus relating
generally to commissions to be earned by the underwriters and
certain allegedly improper agreements between the underwriters
and certain purchasers of the Company's common stock. It also
alleges that the SEC and/or other regulatory authorities are
investigating underwriting practices similar to those alleged in
the complaint.
On July 15, 2002, the issuer defendants as a group filed a
motion to dismiss the claims alleged in the consolidated
complaints. On October 8, 2002, the court entered an order
dismissing, without prejudice, all of the claims against
Mr. McAndrews, Mr. Hanauer and Mr. Littauer. On
February 19, 2003, the court granted the Company's motion to
dismiss the claims against it under Section 10(b) of the
Securities Exchange Act of 1934 and denied its motion to dismiss
the claims against it under Section 11 of the Securities Act of
1933.
By action of a special committee of disinterested directors (who
were neither defendants in the litigation nor members of the
Company's Board of Directors at the time of the actions
challenged in the litigation), the Company recently decided to
accept a settlement proposal presented to all issuer defendants.
In this settlement, plaintiffs will dismiss and release all
claims against the Company and Mr. McAndrews, Mr. Hanauer and
Mr. Littauer, in exchange for a contingent payment by the
insurance companies collectively responsible for insuring the
issuers in all of the consolidated IPO cases, and for the
assignment or release of certain potential claims that the
Company may have against the underwriters. The Company will not
be required to make any cash payments in the settlement, unless
the pro rata amount paid by the insurers in the settlement on
our behalf exceeds the amount of the insurance coverage, a
circumstance that the Company believes is not likely to occur.
On July 31, 2003, the Company conditionally approved the
proposed partial settlement. The settlement would provide,
among other things, a release of the Company and of the
individual defendants for the conduct alleged to be wrongful in
the consolidated complaint. The Company would agree to
undertake other responsibilities under the settlement, including
agreeing to assign away, not assert, or release certain
potential claims the Company may have against its underwriters.
Any direct financial impact of the proposed settlement is
expected to be borne by the Company's insurance carriers.
In June 2004, an agreement of settlement was submitted to the
court for preliminary approval. The court requested that any
objections to preliminary approval of the settlement be
submitted by July 14, 2004, and the underwriter defendants
formally objected to the settlement. The plaintiffs and issuer
defendants separately filed replies to the underwriter
defendants' objections to the settlement on August 4, 2004. The
court granted the motion for preliminary approval, and now
notice will be given to all class members of the settlement, a
"fairness" hearing will be held and if the court determines that
the settlement is fair to the class members, the settlement will
be approved.
The suit is styled "In re Avenue A, Inc. Initial Public Offering
Sec. Litigation," related to "In re Initial Public Offering
Securities Litigation, Master File No. 21 MC 92 (SAS)," filed in
the United States District Court for the Southern District of
New York under Judge Shira A. Scheindlin. The plaintiff firms
in this litigation are:
(i) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(ii) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(iii) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(iv) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(v) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(vi) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
ART TECHNOLOGY: MA Court Yet To Rule on Summary Judgment Motion
---------------------------------------------------------------
The United States District Court for the District of
Massachusetts has yet to rule on Art Technology Group, Inc.'s
motion to dismiss the remaining claims in the consolidated class
action filed against it and certain of its former officers.
Seven purported class action suits were initially filed,
alleging that the defendants violated Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934 and Rule 10b-5
thereunder, which generally may subject issuers of securities
and persons controlling those issuers to civil liabilities for
fraudulent actions or defects in the public disclosure required
by securities laws. Four of the cases were filed on various
dates in October 2001 in the U.S. District Court for the
District of Massachusetts. Three of the cases were initially
filed in the Central District of California on various dates in
August and September 2001. All of the actions were consolidated
and transferred to the District of Massachusetts on or about
November 27, 2001.
On December 13, 2001, the court issued an order of consolidation
in which it consolidated all actions filed against the Company
and appointed certain individuals as lead plaintiffs in the
consolidated action. It also appointed two law firms as co-lead
counsel, and a third law firm as liaison counsel. Counsel for
the plaintiffs filed a consolidated amended complaint applicable
to all of the consolidated actions.
On April 19, 2002, the Company filed a motion to dismiss the
case. On September 4, 2003, the court issued a ruling
dismissing all but one of the plaintiffs' allegations. The
remaining allegation is based on the veracity of a public
statement made by one of the Company's former officers and is
the subject of a motion to dismiss and summary judgment filed by
the Company on August 31, 2004 currently pending before the
court.
AXONYX INC.: Shareholders Lodge Securities Fraud Suit in S.D. NY
----------------------------------------------------------------
Axonyx, Inc. faces several securities class actions filed in the
United States District Court for the Southern District of New
York, alleging violations of federal securities laws. The suits
also name as defendants:
(1) Dr. M. Hausman,
(2) Dr. G. Bruinsma and
(3) Mr. S. Colin Neill
The lawsuits assert claims under Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 thereunder on
behalf of a class of purchasers of the Company's common stock
during the period from June 26, 2003, through and including
February 4, 2005. The complaints allege generally that the
defendants knowingly or recklessly made false or misleading
statements during the Class Period regarding the effectiveness
of Phenserine in treating mild to moderate Alzheimer's disease,
which had the effect of artificially inflating the price of our
shares. The complaints seek unspecified damages.
BAJA PRODUCTS: Recalls 145T Activity Sets Due To Choking Hazard
---------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Baja Products Inc. of Delray Beach, Florida is
voluntarily recalling about 145,000 My First Crayon-BallT and My
First Crayon-BallT Activity Sets.
Small crayon balls can break loose from the plastic base of the
products. This can pose a choking hazard to young children.
My First Crayon-BallT consists of a round yellow plastic base
with small red, blue, yellow, green, black, and brown crayon
balls attached. My First Crayon-BallT Activity Set contains a
round yellow plastic base with small red, blue, yellow, green,
black, and brown crayon balls attached, as well as multiple
scrolls of paper containing sketches meant for coloring.
Manufactured in China, the sets were sold at discount and toy
stores nationwide from June 2004 through March 2005 for between
$2 and $5.
Consumers should take these toys away from children immediately
and return them to the store where purchased for a refund or
call Baja Products for a replacement product. For additional
information, contact Baja Products Inc. toll-free at
(800) 556-3674 between 9 a.m. and 5 p.m. ET Monday through
Friday.
BLOCKBUSTER INC.: Seeks To Move OR Woman's Suit To Federal Court
----------------------------------------------------------------
Dallas-based video retailer Blockbuster, Inc. is seeking to move
a Portland, Oregon woman's class action against it for allegedly
charging her $1.25 for returning a movie late, during the much-
ballyhooed "End of Late Fees" marketing campaign, The Associated
Press reports.
The case, which was filed in March 4 in State Circuit Court, may
be the first in Oregon to use legislation that President Bush
signed into law last February 18. Under the new law federal
courts are given automatic jurisdiction over class-action
lawsuits when defendants estimate potential damages at more than
$5 million and most of the plaintiffs are from out of state. It
also limits payments to plaintiffs' lawyers. Plaintiffs though
may still ask federal judges to send the case back to state
court.
Supporters of the new law pointed out that it will dampen
frivolous lawsuits that attorneys shopped around in hopes of
finding a friendly state court. However, opponents say the law
enables companies to stall by sending the suits to overburdened
federal courts.
Blockbuster faces four similar lawsuits in New York and Los
Angeles, and last month, it agreed to change how it markets its
late-fees policy to settle an inquiry by attorneys general of 47
states and the District of Columbia. The changes that the
Company agreed to include, the enlargement of print on
advertising to make it clearer that if a movie or game is turned
in a week past the due date, customers are charged the full
retail price. If customers return the rental within 30 days, the
full retail price is refunded, yet they still must pay a
"restocking fee" ranging from $1.25 to $1.75.
CROMPTON CORPORATION: PA Residents Commence Toxic Tort Lawsuit
--------------------------------------------------------------
Crompton Corporation and other owners of property near its
Petrolia, Pennsylvania facility face a toxic tort class action
lawsuit alleging contamination in and around the named areas
that gave rise to certain property damage and personal injuries.
The plaintiffs also seek clean-up by the defendants of the
alleged contamination.
This action is in the early procedural stages of litigation, and
the Company cannot predict its outcome, the Company said in a
regulatory filing. The Company intends to assert all
meritorious legal defenses and other equitable factors that are
available with respect to these matters, and believes that the
likelihood of a material adverse effect resulting from the
currently indeterminable remedial costs or damages is remote.
However, the resolution of the environmental matters now pending
or hereafter asserted against the Company or any of its
subsidiaries could require the Company to pay remedial costs or
damages in excess of its present estimates, and as a result
could, either individually or in the aggregate, have a material
adverse effect on the Company's financial condition, results of
operations and cash flows.
FEDERATED DEPARTMENT: NY Judge Dismisses Securities Fraud Case
--------------------------------------------------------------
Judge Richard Conway Casey of the U.S. District Court of the
Southern District of New York dismissed a class-action
securities fraud case filed against Federated Department Stores
Inc., The Cincinnati Business Courier reports.
The case stems from Federated's failed 1999 purchase of
Fingerhut Cos., a catalog retailer laden with credit
delinquencies by its customers. Federated though shuttered it
three years later, then laid off thousands of its workers and
sold off its catalog properties. A class of investors who
bought Federated stock between February 23, 2000, and July 20,
2000, launched the lawsuit against the company claiming that
Federated and its executives knew of or recklessly ignored
Fingerhut's problems and materially overstated its financials.
However, in a March 25 decision, Judge Casey ruled that the
Federated shareholders failed to prove that the company intended
to deceive, manipulate or defraud investors. He thus dismissed
the case with prejudice and ruled that the plaintiffs will not
be able to file an amended complaint.
Cincinnati-based Federated (NYSE:FD) operates more than 450
department stores under names such as Macy's and Bloomingdale's.
The company is working on an acquisition of St. Louis-based May
Department Stores Co. (NYSE:MAY) that would make Federated the
largest U.S. department store operator.
FRANCE: Consumer Association Pushes For U.S.-Style Class Actions
----------------------------------------------------------------
Haunted by the SFR case of 2001 and others like it, the French
consumer association, UFC-Que Choisir, lobbied hard for the
introduction of U.S.-style class-action lawsuits, where an
attorney for one or more plaintiffs can also press their claim
on behalf of all other potential victims, The Associated Press
reports.
The 2001 case that haunts UFC-Que Choisir involved mobile
operator SFR, which had overcharged clients by 7.3 million euros
($9.4 million). Those overcharges prompted France's main
consumer association to sue the company on behalf of two
subscribers and later won a ruling that the fee hike was
illegal. However, the company refused to issue refunds to the
400,000 over-billed customers who weren't named in the suit and
kept almost all of the cash. The association's efforts bore
fruit in January, when President Jacques Chirac revealed plans
for a new class-action law, and a government-appointed panel
began preparing it just recently.
With the tact that his job requires, Finance Minister Thierry
Breton told The Associated Press, "Companies will be alert to
the risk of class actions and will give an even higher priority
to the consumer and the quality of their products and services
than they already do now."
However, the government also wants to avoid class action
"abuses" seen in the United States, Mr. Breton adds. According
to him, "They've imposed excessive costs on companies on the
other side of the Atlantic and damaged the economy as a whole,
without delivering any benefit for the vast majority of
consumers."
Just as class-action lawsuits arrive in Europe, Britain and
Sweden have recently opened their courts to limited forms of
class actions and Italy is considering them, but the United
States is taking steps to rein them in.
Besides exposing French companies to unfounded litigation, U.S.
Chamber of Commerce's lawyer Stanton Anderson contends that the
new law will make it easier for American lawyers to press
frivolous claims against U.S. companies on behalf of French
consumers.
Indeed, France's main employers' group, Medef argues that French
class actions should be restricted to plaintiffs who sign up to
the lawsuits rather than being applied automatically to all
possible plaintiffs except those who formally withdraw, as in
the United States.
However, UFC-Que Choisir is pushing for the U.S.-style "opt-out"
system. Anything less, according to legal director Gaelle
Patetta would make it hard to take action when companies like
SFR run roughshod over hundreds of thousands of customers. "How
can an association like ours manage 400,000 mandates?" she asks.
Eventually, experts predict, the moves afoot in Britain, Sweden
and France could lead to a European Union-wide class action law,
since governments generally prefer their neighbors' industries
to be exposed to the same kinds of risk as their own.
Peter Burbidge, a law professor at Britain's Westminster
University told AP, "It's not for tomorrow, but if it gets off
the ground in France, and since we already have it in Sweden,
then maybe we'll see something at a European level. The French
would want others to have it if they have it."
GENTEK INC.: Mediation in CA Injury Suit Set For April 26,2005
--------------------------------------------------------------
Mediation in the master complaint filed against Gentek, Inc. due
to the release of sulfur dioxide and/or sulfur trioxide from its
Richmond, California facility is set for April 26,2005.
Prior to October 2002, lawyers claiming to represent more than
47,000 persons filed approximately 24 lawsuits in several
counties in California state court (Alameda, Contra Costa, San
Francisco superior courts), making claims against the Company
and, in some cases, a third party arising out of May 1, 2001
and/or November 29, 2001 releases of sulfur dioxide and/or
sulfur trioxide from the Company's Richmond, California sulfuric
acid facility. These claims were addressed in the Plan as
California Tort Claims.
The first case was filed in 2001 and subsequent cases were filed
from March through July 2002. On May 1, 2002, a class action
lawsuit arising out of the same facts was also filed. The
lawsuits claim various damages for alleged injuries, including,
without limitation, claims for personal injury, emotional
distress, medical monitoring, nuisance, loss of consortium and
punitive damages. The Company filed a petition for coordination
to consolidate the state court cases before a single judge. The
petition for coordination has now been granted and follow-on
petitions to add additional cases to the coordinated proceedings
have been granted. The state court cases were stayed as a
result of the Filing.
Approximately 73,000 proofs of claim were submitted in the
bankruptcy proceedings on behalf of the Richmond claimants,
seeking damages for the May 1, 2001 and/or November 29, 2001
releases. A preliminary review of the claimant list indicated
that the claimants included most of the plaintiffs in the state
court cases, plus several thousand duplicates and some
additional claimants. In addition, one class proof of claim was
submitted. A motion for class certification was filed but the
motion was later withdrawn subject to being re-filed in state
court. The Company filed a motion to lift the automatic stay and
discharge injunction to allow liquidation of the claims to
proceed in California State Court. That motion was granted upon
stipulation of the parties, and the action is proceeding in
California State Court.
In June 2004, the plaintiffs filed a Master Complaint that is
intended to supersede the prior pleadings on behalf of
individual plaintiffs. The Master Complaint seeks damages and
other remedies arising out of the May 1, 2001 and November 29,
2001 releases based upon causes of action, among others, for
negligence, Business and Professions Code Section 17200,
nuisance and trespass. The Master Complaint also names Latona
Associates Inc., Matthew Friel (GenTek, Inc.'s Chief Financial
Officer at the time) and Paul Montrone (a former director and
shareholder of GenTek) as defendants. The class action complaint
was also amended in June 2004 to add these additional
defendants. The Company has answered the complaints. Since that
time, plaintiffs have agreed to dismiss Mr. Friel from the
litigation without prejudice. Pursuant to the provisions of its
management agreements with Latona and other applicable
provisions, the Company is also providing a defense for Latona
Associates Inc., Paul Montrone and Matthew Friel in connection
with the master complaint and amended class action complaint.
The state court has entered several case management orders for
the first phase of the cases, including the requirement that
plaintiffs complete questionnaires regarding their claims by
October 25, 2004 or their claims are subject to dismissal upon
motion by the Company. The Company recently filed a motion to
dismiss approximately 41,000 of the 73,000 proofs of claim for
failure to submit questionnaires. Hearings on the motion will be
held on March 18, 2005, and April 20, 2005. The parties are in
active written and document discovery. Depositions are expected
to commence in the Spring of 2005 and a mediation has been
scheduled for April 26, 2005. No trial date has been set.
GOLD BANC: Farm Borrowers Refile Dismissed Lawsuit In OK Court
--------------------------------------------------------------
Gold Banc Corporation faces two class actions filed in Oklahoma
courts, on behalf of farm borrowers under its Farm Service
Agency (FSA) guaranteed loan programs.
On September 10, 2004, a class action case was filed in the
District Court of Kingfisher County, Oklahoma. On September 23,
2004, a second class action case was filed against the Company
in United States District Court for the Western District of
Oklahoma. Both class actions contained various claims related
to the Company's operation of such loan program.
The federal case was dismissed on January 26, 2005, but on
February 2, 2005, the same plaintiffs re-filed their claims in
the District Court of Washita County Oklahoma. Both remain pending.
HOOVER CO.: Recalls 636,000 Vacuum Cleaners Due To Fire Hazard
--------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Hoover Co., of North Canton, Ohio, which is part of the
Maytag Corporation, is voluntarily recalling about 636,000
Hoover Self-Propelled Upright Vacuum Cleaners.
The recalled vacuums have defective on-off switches that can
overheat the handle and tool holder areas of the vacuum,
resulting in a fire hazard. Maytag has received 249 reports of
vacuums overheating, which caused the handle area to smoke, melt
or catch fire. One minor burn injury requiring no medical
attention was reported.
Description: Hoover Self-Propelled Upright Vacuum Cleaners are
plastic, upright vacuums with the brand name "Hoover" and words
"Self Propelled" printed on the front of the product. The model
and serial numbers are printed on a label on the back of the
vacuum.
The following model numbers are included in the recall:
(1) U6423-900
(2) U6425-900
(3) U6425-950
(4) U6445-900
(5) U6445-960
(6) U6449-900
(7) U6450-900
(8) U6451-900
(9) U6455-900
Only those Hoover Self-Propelled Upright Vacuum Cleaners
manufactured between May 1998 and November 1999 are included in
this recall. The recalled models include serial numbers
0598xxxxxxxx through 1199xxxxxxxx, with the first four digits of
the serial number indicating the month and year of production
(e.g., 0598xxxxxxxx is May 1998).
Manufactured in the United States the cleaners were sold at
household appliance and floorcare retailers nationwide from May
1998 through July 2000 for between $259 and $279.
Consumers should stop using the recalled product immediately and
contact Maytag to obtain the name and address of the nearest
Hoover repair center to schedule a free repair. Consumers should
not return their vacuum cleaners to retailers.
Consumer Contact: Call Maytag Corp. toll-free at (800) 250-6075
between 8 a.m. and 5 p.m. ET Monday through Friday or visit the
firms' Web sites at http://www.maytag.comor
http://www.hoover.com.
INSIGHT COMMUNICATIONS: Shareholders File 4 Fiduciary Duty Suits
----------------------------------------------------------------
Insight Communications Company, Inc. and each of its directors
face four purported class action lawsuits filed in the Delaware
Court of Chancery. Three of the lawsuits also name The Carlyle
Group as a defendant. Three of these lawsuits were filed on
March 7, 2005 and are identified as:
(1) Wagenti v. Insight Communications Company, Inc., et
al.;
(2) Schemis v. Insight Communications Company, Inc., et
al.; and
(3) Bellamy v. Insight Communications Company, Inc., et al.
The fourth lawsuit was filed on March 14, 2005 and is identified
as Central Laborers' Pension Fund v. Insight Communications
Company, Inc., et al.
The complaints allege, among other things, that the defendants
have breached their fiduciary duties to the stockholders of
Insight in connection with a proposal from Sidney R. Knafel and
Michael Willner, together with certain related and other
parties, and The Carlyle Group to acquire all of the
outstanding, publicly-held Class A common stock of the Company.
The complaints also seek the certification of a class of Company
stockholders; preliminary and permanent injunctive relief
prohibiting the defendants from proceeding with the proposed
transaction; rescission or other damages in the event the
proposal is consummated; an accounting; costs and disbursements,
including attorneys' fees; and other relief.
INTERMUNE INC.: CA Court To Hear Motion To Dismiss Stock Lawsuit
----------------------------------------------------------------
The United States District Court for the Northern District of
California is set to hear this month the motion to dismiss the
consolidated securities class action filed against InterMune,
Inc., its former chief executive officer and former chief
financial officer.
On June 25, 2003, several suits were filed, namely:
(1) Johnson v. Harkonen and InterMune, Inc., No. C 03-2954-
MEJ,
(2) Lombardi v. InterMune, Inc., Harkonen and Surrey-
Barbari, No. C 03 3068 MJJ
(3) Mahoney Jr. v. InterMune Inc., Harkonen and Surrey-
Barbari, No. C 03-3273 SI and
(4) Adler v. Harkonen and InterMune Inc., No. C 03-3710 MJJ
On November 6, 2003, the various complaints were consolidated
into one case by order of the court, and on November 26, 2003, a
lead plaintiff, Lance A. Johnson, was appointed. A consolidated
complaint titled "In re InterMune Securities Litigation, No. C
03-2954 SI," was filed on January 30, 2004. The consolidated
amended complaint named the Company, and its former chief
executive officer and its former chief financial officer, as
defendants and alleges that the defendants made certain false
and misleading statements in violation of the federal securities
laws, specifically Sections 10(b) and 20(a) of the Exchange Act,
and Rule 10b-5. The lead plaintiff seeks unspecified damages on
behalf of a purported class of purchasers of the Company's
common stock during the period from January 7, 2003 through June
11, 2003.
The Company and the other defendants filed a motion to dismiss
the complaint on April 2, 2004, which was granted in part and
denied in part. Plaintiffs filed a second amended complaint on
August 23, 2004, and the defendant filed in a motion to dismiss
the second amended complaint on October 7, 2004. The motion is
scheduled to be heard this month.
INTERNET CAPITAL: NY Court Preliminarily Okays Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Internet
Capital Group, Inc., certain of its present and former directors
and its underwriters.
In May and June 2001, nine class action complaints were filed on
behalf of present and former stockholders of the Company. The
complaints generally allege violations of Sections 11 and 12 of
the Securities Act of 1933 and Rule 10b-5 promulgated under the
Securities Exchange Act of 1934, based on, among other things,
the dissemination of statements allegedly containing material
misstatements and/or omissions concerning the commissions
received by the underwriters of the initial public offering and
follow-on public offering of the Company as well as failure to
disclose the existence of purported agreements by the
underwriters with some of the purchasers in these offerings to
buy additional shares of the Company's stock subsequently in the
open market at pre-determined prices above the initial offering
prices. The plaintiffs seek for themselves and the alleged class
members an award of damages and litigation costs and expenses.
The claims in these cases have been consolidated for pre-trial
purposes (together with claims against other issuers and
underwriters) before one judge in the Southern District of New
York federal court. In April 2002, a consolidated, amended
complaint was filed against these defendants which generally
alleges the same violations and also refers to alleged
misstatements or omissions that relate to the recommendations
regarding the Company's stock by analysts employed by the
underwriters. In June and July 2002, defendants, including the
Company defendants, filed motions to dismiss plaintiffs'
complaints on numerous grounds. The Company's motion was denied
in its entirety in an opinion dated February 19, 2003.
In July 2003, a committee of the Company's Board of Directors
approved a proposed settlement with the plaintiffs in this
matter. The settlement would provide for, among other things, a
release of the Company and of the individual defendants (who had
been previously dismissed without prejudice) for the wrongful
conduct alleged in the amended complaint. The Company would
agree to undertake other responsibilities under the partial
settlement, including agreeing to assign away, not assert, or
release certain potential claims the Company may have against
its underwriters. Any direct financial impact of the proposed
settlement is expected to be borne by the Company's insurers.
The complete terms of the proposed settlement is on file with
the Court. The Court overseeing the litigation granted
preliminary approval of the settlement in February 2005 subject
to a change in the terms to bar cross-claims by defendant
underwriters for contribution, but not for indemnification or
otherwise. The parties to the settlement are currently
negotiating a revised agreement. Assuming that a revised
agreement is reached, a fairness hearing on the settlement must
be held before the Court can make a final determination
regarding approval of the settlement.
The suit is styled "In re Internet Capital Group, Inc. Initial
Public Offering Sec. Litigation," related to "In re Initial
Public Offering Securities Litigation, Master File No. 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(6) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
IVILLAGE INC.: NY Court Preliminarily Approves Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against iVillage,
Inc., several of its present and former executives and its
underwriters in connection with its March 1999 initial public
offering. The complaint generally asserts claims under the
Securities Act, the Exchange Act and rules and regulations of
the SEC. The complaint seeks class action certification,
unspecified damages in an amount to be determined at trial, and
costs associated with the litigation, including attorneys' fees.
In February 2003, the defendants' motion to dismiss certain of
the plaintiffs' claims was granted in part, but, for the most
part, denied. In June 2003, a proposed settlement of this
litigation was structured between the plaintiffs, the issuer
defendants, the issuer officers and directors named as
defendants, and the issuers' insurance companies. The proposed
settlement generally provides that the issuer defendants and
related individual defendants will be released from the
litigation without any liability other than certain expenses
incurred to date in connection with the litigation, the issuer
defendants' insurers will guarantee $1.0 billion in recoveries
by plaintiff class members, the issuer defendants will assign
certain claims against the underwriter defendants to the
plaintiff class members, and the issuer defendants will have the
opportunity to recover certain litigation-related expenses if
the plaintiffs recover more than $5.0 billion from the
underwriter defendants. The boards of directors of the Company
approved the proposed settlement in July 2003.
On June 25, 2004, the plaintiffs filed a motion for preliminary
approval of the settlement with the court, which was accompanied
by a brief filed by the issuer defendants in support of the
plaintiffs' motion. The court requested that any objections to
preliminary approval of the settlement be submitted by July 14,
2004, and certain underwriter defendants formally objected to
the settlement. The plaintiffs and issuer defendants separately
filed replies to the underwriter defendants' objections to the
settlement on August 4, 2004. On February 15, 2005, the court
issued an opinion and order granting preliminary approval to the
settlement and ordering the plaintiffs and issuer defendants to
submit to the court a revised settlement stipulation consistent
with the court's order.
The suit is styled "In re iVillage, Inc. Initial Public Offering
Sec. Litigation," related to "In re Initial Public Offering
Securities Litigation, Master File No. 21 MC 92 (SAS)," filed in
the United States District Court for the Southern District of
New York under Judge Shira A. Scheindlin. The plaintiff firms
in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(6) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
JUPITERMEDIA CORPORATION: Blocks Gambling-Related Ads on Search
---------------------------------------------------------------
Jupitermedia Corporation blocked all gambling-related
advertisements from being published on its Web properties from
third-party search engines, as a result of a class action filed
in the Superior Court for the State of California, San Francisco
County.
On August 3, 2004, Mario Cisneros and Michael Voight filed the
suit on behalf of themselves and all others situated and/or the
general public against the Company and twelve co-defendant
companies that operate Internet search engines. Cisneros et al.
allege that defendants posting of paid advertising providing
links to Internet gambling Web sites constitutes unfair
competition and unlawful business acts and practices under
California law. Plaintiffs seek declaratory and injunctive
relief, disgorgement of profits and restitution.
On September 3, 2004, the Company blocked all advertisements
from being published on its Web properties from third-party
search engines for the gambling-related terms specified in the
Complaint. Moreover, the Company asserted in a disclosure to
the Securities and Exchange Commission that it does not accept
advertisements for gambling-related Web sites directly from
companies that operate them. The Company has demanded
contractual indemnity from two companies that supplied
advertisements that are the subject matter of the lawsuit.
Neither of these two companies, however, has stated a final
position as whether it will provide indemnity.
The suit is styled "Mario Cisneros et al, v. Yahoo! Inc., et al,
case no. CGC-04-433518," filed in the California Superior Court
in San Francisco County, under Judge Richard A. Kramer.
Representing the plaintiffs are Kathrein R. Reed and Ira P.
Rothken. Lawyers for the Company are David T. Biderman, Robert
Harvey Binzel, Janet L. Cullum, Charles H. Dick, Jr., Albert
Gidari, Richard Jay Idell, Matthew P. Kanny, David H. Kramer,
Thomas P. Laffey, Ryan M. Malone, Laurence F. Pulgram, John C.
Rawls, David O. Stewart.
KENTUCKY FUND: Suit Launched Over Handling of Settlement Balance
----------------------------------------------------------------
Four officers of the Kentucky Fund for Healthy Living, a
foundation responsible for distributing $20 million left over
from Kentucky's fen-phen settlement have paid themselves $60,000
a year each in fees, according to the foundation's report to the
Internal Revenue Service, The Louisville Courier-Journal
reports. A separate report that was released recently by the
foundation also shows that it has made 30 grants to charitable
groups totaling $1,452,595.
The fund was established by court order and directed to give
away money left over after the settlement of a class-action
lawsuit brought by 431 plaintiffs against the manufacturer of
the diet-drug combination, which they alleged damaged their
hearts. The plaintiffs received a reported $200 million based
on their individual injuries. The IRS report though stated that
$20,671,889 remained after the plaintiffs and the lawyers were
paid.
The presiding judge, now-retired Joseph "Jay" Bamberger of Boone
Circuit Court, appointed the legal team that won the settlement
to distribute the excess money to charities "consistent with the
purpose and spirit of the litigation." Thus the judge's order
allowed the officers to pay themselves up to 30 percent of what
the foundation gives away annually.
According to the foundation's IRS filing, it made no grants in
its first 12 months, but a list of contributions released
recently by one of its lawyers, J. Whitney Wallingford, shows
that it gave away $250,000 in 2004 and $1,202,595 so far this
year. The grants included $34,737 to the United Way of the
Bluegrass for an education program for obese children, $42,000
to Berea College for two full scholarships for students majoring
in nursing and $100,000 to the University of Louisville for
cardiovascular research. Mr. Wallingford told the Courier-
Journal the fund was busy during its first year establishing
policies and procedures and reviewing grant applications.
The IRS report, which was obtained by The Courier-Journal under
the federal Freedom of Information Act, shows that in the 12
months ending March 31, 2004, the foundation paid $60,000 each
to attorneys Melbourne Mills Jr., William Gallion and Shirley
Cunningham Jr. and to trial consultant Mark Modlin, who also
received $30,000 in expenses.
More than 300 of the plaintiffs though have questioned these
payments and have in fact filed a new lawsuit, which stated that
it is inappropriate for the legal team to be paid again after
they received tens of millions of dollars in legal fees.
Additionally, they claimed that they were never told about the
foundation or were told the remaining funds were minuscule.
Attorney Angela Ford, who represents the dissident plaintiffs
told the Courier-Journal, "The fact that the funds were then put
into a corporation, without their knowledge or consent, and that
the lawyers now pay themselves out of that corporation, is
unethical and a breach of their fiduciary duty. Many of my
clients . feel they were betrayed by their own lawyers."
Defending the compensation of the fund's officers, Mr.
Wallingford pointed out that they have "significant
responsibility for soliciting and reviewing grant proposals as
well as following up to make sure grant recipients spend the
money properly." Furthermore, he noted that the fund has no
central office and that the lawyers are using their own staff.
A status conference in the new lawsuit that was filed by Ms.
Ford is set for next week in Boone Circuit Court before Special
Judge William J. Wehr.
Fen-phen became the diet craze of the 1990s when researchers
found that, when mixed, the two appetite suppressants,
fenfluramine and phentermine, caused weight loss. However, in
the fall of 1997, the U.S. Food and Drug Administration removed
fen-phen from the market after it was shown to cause heart
defects.
LABRANCHE & CO.: Plaintiffs File NY Consolidated Securities Suit
----------------------------------------------------------------
LaBranche & Co., Inc. faces a consolidated securities class
action filed in the United States District Court for the
Southern District of New York, styled "In re LaBranche
Securities Litigation, No. 03 CV 8201."
On October 16, 2003 through December 16, 2003, nine purported
class action lawsuits were filed by purchasers of the Company's
common stock, including:
(1) Sofran v. LaBranche & Co Inc., et al., No. 03 CV 8201,
(2) Semon v. LaBranche & Co Inc., et al., No. 03 CV 8255,
(3) Haug v. LaBranche & Co. Inc., et al., No. 03 CV 8265,
(4) Labul v. LaBranche & Co Inc., et al., No. 03 CV 8365,
(5) Murphy v. LaBranche & Co Inc., et al., No. 03 CV 8462,
(6) Strain v. LaBranche & Co Inc., et al., No. 03 CV 8509,
(7) Yopp v. LaBranche & Co Inc., et al., No. 03 CV 8783,
(8) Ferris v. LaBranche & Co Inc., et al., No. 03 CV 8806,
and
(9) Levin v. LaBranche & Co Inc., et al., No. 03 CV 8918
On March 22, 2004, the court consolidated these lawsuits under
the caption The court named the following lead plaintiffs:
Anthony Johnson, Clyde Farmer, Edwin Walthall, Donald Stahl and
City of Harper Woods Retirement System. On June 7, 2004,
plaintiffs filed a Consolidated Class Action Complaint. On July
12, 2004, plaintiffs filed a Corrected Consolidated Class Action
Complaint. Plaintiffs allege that they represent a class
consisting of persons and entities that purchased or otherwise
acquired the Company's common stock during the period beginning
on August 19, 1999 and concluding on October 15, 2003.
Plaintiffs allege that the Company, LaBranche & Co. LLC, and
certain of its and/or LaBranche & Co. LLC's past or present
officers and/or directors, including George M.L. LaBranche, IV,
William J. Burke, III, James G. Gallagher, Alfred O. Hayward,
Jr., Robert M. Murphy and Harvey S. Traison, violated Section
10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder
and Section 20(a) of the Exchange Act by failing to disclose
improper specialist trading. Plaintiffs also allege that two
other of the Company's past or present officers and/or
directors, S. Lawrence Prendergast and George E. Robb, Jr., also
violated Section 20(a) of the Exchange Act. Plaintiffs seek
unspecified money damages, attorneys' fees and reimbursement of
expenses.
LABRANCHE & CO.: Faces Consolidated Securities Fraud Suit in NY
---------------------------------------------------------------
LaBranche & Co., Inc. faces a consolidated securities class
action filed in the United States District Court for the
Southern District of New York, styled "In re NYSE Specialists
Securities Litigation, case no. CV 8264."
On October 16, 2003 through December 16, 2003, four purported
class action lawsuits were brought by persons or entities who
purchased and/or sold shares of stocks of NYSE-listed companies
for which LaBranche & Co. LLC and any other NYSE specialist firm
acted as specialist, including:
(1) Pirelli v. LaBranche & Co Inc., et al., No. 03 CV 8264,
(2) Marcus v. LaBranche & Co Inc., et al., No. 03 CV 8521,
(3) Empire v. LaBranche & Co Inc., et al., No. 03 CV 8935,
and
(4) California Public Employees' Retirement System
(CalPERS) v. The New York Stock Exchange, Inc., et al.,
No. 03 CV 9968
On March 11, 2004, a fifth action asserting similar claims,
"Rosenbaum Partners, LP v. The New York Stock Exchange, Inc., et
al. No. 04 CV 2038," was filed in the United States District
Court for the Southern District of New York by an individual
plaintiff who does not allege to represent a class.
On May 27, 2004, the court consolidated these lawsuits. The
court named the following lead plaintiffs: California Public
Employees' Retirement System (CalPERS) and Empire Programs, Inc.
On September 15, 2004, plaintiffs filed a Consolidated Complaint
for Violation of the Federal Securities Laws and Breach of
Fiduciary Duty alleging that they represent a class consisting
of all public investors who purchased and/or sold shares of
stock listed on the NYSE from October 17, 1998 to October 15,
2003.
Plaintiffs allege that the Company, LaBranche & Co. LLC, Mr.
LaBranche and other NYSE specialist firms and their respective
parents and affiliates violated Section 10(b), Rule 10b-5 and
Section 20(a) by failing to disclose improper specialist
trading, improperly profiting on purchases and/or sales of NYSE-
listed securities and breaching and/or aiding and abetting
breaches of fiduciary duty. Plaintiffs also name the NYSE as a
defendant. Plaintiffs seek unspecified money damages,
restitution, forfeiture of fees, commissions and other
compensation, equitable and/or injunctive relief, including an
accounting of and the imposition of a constructive trust and/or
asset freeze on trading proceeds, and attorneys' fees and
reimbursement of expenses.
LABRANCHE & CO.: Plaintiff Withdraws NY Specialist Trading Suit
---------------------------------------------------------------
Plaintiffs voluntarily dismissed the lawsuit filed against
LaBranche & Co., Inc. on behalf of the general public in the
United States District Court for the Southern District of New
York, styled "Posner v. LaBranche & Co Inc., et al., No.
BC307099."
Plaintiff Michelle Posner initially filed the suit in California
State Court, and alleged that the Company, certain of its
officers, other NYSE specialist firms, the parents and
affiliates of other specialist firms and individuals at other
specialist firms violated California Business and Professions
Code 17200 by engaging in improper specialist trading.
Plaintiff sought an order permanently enjoining the alleged
misconduct, restitution, an order declaring acts and practices
to be "unlawful, unfair and/or fraudulent," an accounting to
determine the amount to be returned by defendants and the
amounts to be refunded to members of the public, the creation of
an administrative process for defendants' customers to recover
their losses, and attorneys' fees. On February 27, 2004, the
defendants in the action removed the action to the United States
District Court for the Central District of California (No. CV04-
1345). On May 17, 2004, the action was transferred to the
United States District Court for the Southern District of
New York (No. 04 CV 3966). On December 8, 2004, plaintiff
voluntarily dismissed the action.
LOUISIANA: Court Rules That State Must Pay For Indigent Defense
---------------------------------------------------------------
The Louisiana Supreme Court declared that the Legislature is
responsible for providing adequate resources for attorneys
representing poor criminal defendants and that if there isn't
enough money for a defense, trial judges can stop the
prosecution, The Times Picayune reports.
The decision, which was released on April 1, came down as a task
force began to finalize proposed legislation to review the
indigent defense system, which many in the state say is broken.
According to reform advocates, many defendants who can't afford
to pay for attorneys receive inadequate legal representation.
Although many argue that more money is needed for the system,
the legislation approved recently by the Louisiana Task Force on
Indigent Defense Services made clear it's unlikely that
additional money will be provided by the Legislature this
session.
Jim Boren, a Baton Rouge criminal defense attorney, who is also
a member of the task force told The Times Picayune that one bill
proposed for the session that begins on April 25 will require
various entities in the criminal justice system, from
prosecutors and sheriffs to public defenders, to provide
information to the state about how much money they spend. While
another bill would revamp the state board that oversees indigent
defense and require the local boards that actually handle the
cases to report to the Louisiana Indigent Defense Assistance
Board about what they are doing, he said.
In recent month Louisiana's indigent defense system has come
under fire that includes a lawsuit that was previously reported
in the September 27, 2004 edition of the Class Action Reporter.
In that action, nine plaintiffs backed by the National
Association of Criminal Defense Lawyers filed a lawsuit seeking
class-action status over claims that the Calcasieu Parish
indigent defender program is so under funded that it effectively
denies low-income people facing criminal trials their
constitutional right to adequate legal counsel.
The lawsuit, which was filed on behalf of "all adults who are or
will be" entitled to appointed counsel in criminal cases in
Calcasieu Parish, challenged an already beleaguered system for
naming counsel for indigents. According to the criminal suspects
who are too poor to hire their own lawyers must rely on a public
defender's office without the resources to properly investigate
their cases, especially those in capital murder cases. The
lawsuit was filed in state district court in Lake Charles and
assigned to Judge Wilford Carter. The defendants named in the
suit are Louisiana's Legislature and Governor Kathleen Blanco.
MARTHA STEWART: Working To Settle Securities, Derivative Suits
--------------------------------------------------------------
Martha Stewart Living Omnimedia, Inc. is working to resolve the
consolidated securities class action and the shareholder
derivative actions filed against it and certain of its officers
and directors.
On February 3, 2003, the Company was named as a defendant in a
Consolidated and Amended Class Action Complaint, filed in the
United States District Court for the Southern District of New
York, by plaintiffs purporting to represent a class of persons
who purchased common stock in the Company between January 8,
2002 and October 2, 2002, styled "In re Martha Stewart Living
Omnimedia, Inc. Securities Litigation, 02-CV-6273 (JES)." The
Consolidated Class Action Complaint also names Martha Stewart
and seven of the Company's other present or former officers
(Gregory R. Blatt, Sharon L. Patrick, and five other Company
officers (collectively, the "Individual Defendants")) as
defendants. The action consolidates seven class actions
previously filed in the Southern District of New York, namely:
(1) Semon v. Martha Stewart Living Omnimedia, Inc. (filed
August 6, 2002),
(2) Rosen v. Martha Stewart Living Omnimedia, Inc. (filed
August 21, 2002),
(3) MacKinnon v. Martha Stewart Living Omnimedia, Inc.
(filed August 30, 2002),
(4) Crnkovich v. Martha Stewart Living Omnimedia, Inc.
(filed September 4, 2002),
(5) Rahilly v. Martha Stewart Living Omnimedia, Inc. (filed
September 6, 2002),
(6) Steele v. Martha Stewart Living Omnimedia, Inc. (filed
September 13, 2002), and
(7) Hackbarth v Martha Stewart Living Omnimedia, Inc.
(filed September 18, 2002)
The claims in the Consolidated Class Action Complaint arise out
of Ms. Stewart's sale of 3,928 shares of ImClone Systems stock
on December 27, 2001. The plaintiffs assert violations of
Sections 10(b) (and rules promulgated thereunder), 20(a) and 20A
of the Securities Exchange Act of 1934. The plaintiffs allege
that MSO, Ms. Stewart and the Individual Defendants made
statements about Ms. Stewart's sale that were materially false
and misleading. The plaintiffs allege that, as a result of these
false and misleading statements, the market price of the
Company's stock was inflated during the putative class periods
and dropped after the alleged falsity of the statements became
public. The plaintiffs further allege that the Individual
Defendants traded MSO stock while in possession of material non-
public information. The Consolidated Class Action Complaint
seeks certification as a class action, damages, attorneys' fees
and costs, and further relief as determined by the court.
On May 19, 2003, the Company's motion to dismiss the
Consolidated Class Action Complaint was denied, and discovery in
that action is ongoing. By stipulation of the parties, and an
order of the court entered November 10, 2003, all claims
asserted in the Consolidated Class Action Complaint pursuant to
Section 20A (Insider Trading) of the Securities Exchange Act
against the Individual Defendants, and all remaining claims
against the Individual Defendants, other than Mr. Blatt and Ms.
Patrick, have been dismissed without prejudice.
The Company has also been named as a nominal defendant in four
derivative actions, all of which name Ms. Stewart, and certain
other officers and directors of the Company as defendants:
(i) In re Martha Stewart Living Omnimedia, Inc. Shareholder
Derivative Litigation (the "Shareholder Derivative
Litigation")," filed on December 19, 2002 in New York
State Supreme Court;
(ii) Beam v. Stewart, initially filed on August 15, 2002 and
amended on September 6, 2002, in Delaware Chancery
Court;
(iii) Richards v. Stewart, filed on November 1, 2002 in
Connecticut Superior Court; and
(iv) Sargent v. Martinez, filed on September 29, 2003 in the
U.S. District Court for the Southern District of New
York.
In re Martha Stewart Living Omnimedia, Inc. Shareholder
Derivative Litigation consolidates three previous derivative
complaints filed in New York State Supreme Court and Delaware
Chancery Court: "Beck v. Stewart," filed on August 13, 2002 in
New York State Supreme Court, "Kramer v. Stewart," filed on
August 20, 2002 in New York State Supreme Court, and "Alexis v.
Stewart," filed on October 3, 2002 in Delaware Chancery Court.
Sargent consolidates two derivative complaints previously filed
in the U.S. District Court for the Southern District Court of
New York: "Acosta v. Stewart," filed on October 10, 2002, and
"Sargent v. Martinez," filed on May 30, 2003.
On September 30, 2003, the Company's motion to dismiss the Beam
complaint was granted in its entirety. The plaintiffs in Beam
appealed the dismissal of the complaint to the Delaware Supreme
Court. On March 31, 2004, the Delaware Supreme Court, sitting en
banc, unanimously affirmed the dismissal of the Beam complaint.
The Sargent action had previously been stayed by order of the
court, pending resolution of the Beam appeal by the Delaware
Supreme Court. On April 22, 2004, the court lifted that stay and
ordered the plaintiffs to respond to MSO's and the MSO
directors' previously filed motions to dismiss. By order dated
August 4, 2004, the Company's motion to dismiss the Sargent
complaint was granted in its entirety, and as to the issue of
plaintiffs' failure to make pre-suit demand, with prejudice. The
Sargent plaintiffs' time to appeal that dismissal has expired.
The Richards action had been stayed by agreement of the parties
pending resolution of the Beam appeal by the Delaware Supreme
Court. By motion filed June 4, 2004, the plaintiff in the
Richards action voluntarily sought an order dismissing the
Richards action with prejudice, and that dismissal with
prejudice was ordered by the court on June 9, 2004. By
stipulation and order entered September 24, 2004, the parties to
the Shareholder Derivative Litigation agreed to the dismissal of
that action on the same terms as ordered by the Sargent Court in
dismissing the Sargent Action.
MCCOWN DELEEUW: Ex-Employees Launch Suit Over Mass Layoffs in ID
----------------------------------------------------------------
Former CEDU Education/Brown School employees, Douglas Marshall,
Mason Jones, Curtis Hewston and Doreen Dengris initiated a class
action lawsuit against McCown Deleeuw & Company, Inc. in US
District Court, Coeur d'Alene, Idaho on behalf of themselves and
of similarly situated people, The Ruralnorthwest.com reports.
The plaintiffs launched the suit based on the allegation that
McCown violated the WARN Act, which falls under Rule 23 of the
Federal Rules of Civil Procedure.
According to court papers, filed by the attorneys for the
plaintiffs, Reed & Giesa of Spokane, Washington and Banks Law
Office of Portland, Oregon, this rule states that any employer
of 100 or more people is prohibited from ordering a simultaneous
mass layoff without a 60-day notice.
The document further stated that former President of CEDU
Education, Fenton "Pete" Talbot, was one of three persons to
sign the Unanimous Written Consent of the Board of Directors of
Brown Schools, Inc. The Unanimous Written Consent authorized the
March 25, 2005, voluntary filing of bankruptcy petitions of each
member of the Brown School Enterprise, indicating that of McCown
controlled and effected the mass layoffs in violation of the
WARN Act.
MERCEDES-BENZ USA: NJ Judge Rules Area Dealers Are Class Members
----------------------------------------------------------------
U.S. District Court Judge William Walls (N.J.) ruled that
persons who leased new Mercedes-Benz vehicles from its New York,
New Jersey, and Connecticut area dealers are members of a class
action lawsuit which was brought in September 1999 on behalf of
all purchasers and lessees of such vehicles in the New York
region from February 1, 1992 through August 30, 1999, according
to the law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
The lawsuit, In re Mercedes-Benz Antitrust Litigation, alleges
that Mercedes-Benz USA and its New York Region dealers engaged
in a price-fixing conspiracy in violation of the antitrust laws
that inflated the price paid for Mercedes-Benz vehicles in the
New York Region during the Class Period.
Defendants had contended that persons who leased, rather than
purchased, their new Mercedes-Benz vehicle were not entitled to
sue under the federal antitrust laws. "The Court's decision
soundly rejected that argument and decided that persons who
leased new Mercedes-Benz vehicles are as entitled to sue for the
harm done to them as if they had financed the purchase of their
vehicle," said R. Joseph Barton of Cohen, Milstein, Hausfeld &
Toll, P.L.L.C., the attorney who argued the motion for
plaintiffs. "We believe that this is the first published
decision to directly address whether persons who lease, rather
than purchase, a product can sue for injury as a result of
conduct which violates the federal antitrust laws," Barton said.
The Court previously certified the case as a class action and
has preliminarily approved of a settlement on behalf of the
class with six of the dealer defendants for $5.1 million. The
litigation is proceeding against the remaining dealer
defendants, Mercedes-Benz U.S.A. and the accounting firm, Sheft
Kahn & Company.
For more details, contact Deborah Schwartz, of Cohen, Milstein,
Hausfeld & Toll by Phone: 301-897-8838 or (cell) 240-355-8838.
MISSISSIPPI: Judge Sets Status Hearing For NMHS Settlement Talks
----------------------------------------------------------------
U.S. District Judge Michael P. Mills scheduled a May 12 hearing
into the breakdown of talks between North Mississippi Health
Services (NMHS) and a plaintiffs attorneys group led by attorney
Richard Scruggs involving discounted care to uninsured patients,
The Associated Press reports.
According to Judge Mills, the planned session is a status
hearing on his September order, in which he directed North
Mississippi Health Systems, or NMHS, and the uninsured clients
represented by the Scruggs firm to put more substantial and
effective conflicts of interest policies into an agreement.
Mr. Scruggs and other plaintiffs' attorneys had earlier asked
Judge Mills to implement stringent conflict-of-interest policies
for the hospital's board of directors and senior executives.
Over the past seven months, the two sides have argued about the
court-ordered negotiations, but just recently both sides
announced that talks had broken off.
As previously reported in the April 8, 2005 edition of the Class
Action Reporter, almost seven months after entering the
memorandum of understanding (MOU), a framework for a potential
settlement, with a plaintiff's attorney group headed by the
Scruggs Law Firm to settle concerns over discounts provided to
uninsured patients, North Mississippi Health Services (NMHS)
reached an impasse in its attempt to reach a final agreement
with respect to charity discounted care to the uninsured.
North Mississippi Health Services is the parent corporation for
North Mississippi Medical Center (NMMC), a 650-bed hospital
located in Tupelo, Miss., along with five smaller community
hospitals in northeast Mississippi and northwest Alabama.
John Heer, NMHS president and chief executive officer said,
"Since the announcement of the MOU, the landscape has changed.
NMHS has experienced a significant increase in the volume of
charity care. It appears that patients are bypassing other
hospitals in the 24-county service area and coming to NMHS to
receive charity care." Prior to the MOU, NMHS had a charity
policy in place and has continued to use those charity
guidelines. In fiscal year 2004, NMHS provided $45 million in
charity care, which represents 4.32 percent of NMHS' gross
charges and is larger than NMHS' bottom line.
"The $45 million in charity represents a significant increase
when compared with the $32 million in charity care written off
by NMHS in fiscal year 2003. Based on FY'03 activity, NMHS
budgeted $35 million for charity care in FY '04. As the public
became aware of the memorandum of understanding, NMMC
experienced a marked increased for charity care in August and
September 2004 and the first four months of FY '05. We are
anticipating charity care to exceed $60 million this year," Mr.
Heer said.
As part of NMHS' voluntary commitment to the memorandum of
understanding, the NMHS board of directors approved a revised
conflict of interest policy* and is implementing an enhanced
charity policy* that provides uninsured patients with the same
discount provided under its average managed care contracts.
When NMMC entered the memorandum of understanding in August
2004, class action lawsuits had been filed against 40 hospitals
and health care systems across the United States alleging that
hospitals have failed to fulfill their charitable mission by not
providing health care to uninsured patients at discounted rates.
The courts have dismissed most of these suits. NMHS agreed to
the memorandum of understanding as a framework to attempt to
develop a settlement to avoid the distraction and cost
associated with a lawsuit.
"Our organization is dedicated to providing quality health care
to everyone, whether they have insurance or not," Mr. Heer said.
"We are withdrawing from these negotiations because the proposed
terms would have a devastating economic impact on our
organization and the services we provide. We have given and will
continue to provide charity care to those who meet our charity
care guidelines."
For more details, visit http://www.nmhs.net/breakingnews.asp.
NAPOLI KAISER: NY Judge Dismisses Suit Over Fen-Phen Settlement
---------------------------------------------------------------
Plaintiffs who accused a New York law firm of settling fen-phen
diet drug claims for lower amounts and used pressure tactics to
force settlements and secure large fees have had their case
dismissed by Southern District of New York Judge Laura Taylor
Swain, The New York Law Journal reports.
In her ruling, the judge stated that she dismissed the putative
class action brought by some 5,600 plaintiffs against Napoli,
Kaiser & Bern, since she found that their claims fall within
arbitration agreements. In addition, she also found that there
was no evidence that fraud was used in the firm's retainer
agreements. In Buckwalter v. Napoli, Bern & Kaiser, 01 Civ.
10868, Judge Swain also found that the claims for violations of
the racketeering statute, breach of duty of care/malpractice,
breach of fiduciary duty and conspiracy against the law firm and
name partners was clearly within the scope of the arbitration
clauses.
The 1997 announcement by the Food and Drug Administration that
serious health risks were prompting the agency to recall two
diet drugs, known under the umbrella fen-phen, triggered the
filing of thousands of cases across the country that were
ultimately consolidated in the Eastern District of Pennsylvania.
One of the drugs' manufacturers, American Home Products, settled
many of the claims in 1999, agreeing to pay up to $3.75 billion.
U.S. District Judge Louis Bechtle in Philadelphia approved the
settlement in 2000, which capped attorney fees at 9 percent.
According to court documents, Napoli, Kaiser & Bern opposed the
settlement and urged many of its clients to opt-out. In
mailings, the firm promised that individualized treatment of
their claims would produce "staggering" results. Additionally,
the firm also recruited additional clients and accepted
referrals from other firms around the country with the other
firms acting as brokers who would receive a share of the fees.
Then after those moves, Napoli Kaiser began filing claims on
behalf of some 5,600 individuals in Manhattan Supreme Court,
which were consolidated before Justice Helen Freedman.
Eventually, a settlement was reached with American Home Products
that was believed to be worth hundreds of millions of dollars
and, the plaintiffs alleged, called for Napoli Kaiser to receive
a contingency fee of one-third the total amount.
The plaintiffs, who were now represented in New York by Lovell &
Stewart as well as firms in Seattle and Los Angeles, claimed
that Napoli Kaiser and name partners Paul J. Napoli, Gerald
Kaiser and Marc Jay Bern, conspired to settle some claims for
lower amounts in order to minimize the referral fees that Napoli
Kaiser owed other firms.
Furthermore, the plaintiffs charged, Judge Swain said, that
Napoli Kaiser tried to convince them to accept settlement
amounts "through various pressure tactics, including misleading
and inaccurate letters, coercive telephone conversations and
hotel room meetings with clients, and testimonials from a
registered nurse on the NKB payroll that the settlement amounts
offered to individual clients provided accurate compensation for
the injuries suffered." Plaintiffs also alleged that Napoli
Kaiser was driven by a desire to maximize its fees while
minimizing the amount of work performed, leaving plaintiffs who
opted out of the national settlement worse off than those who
took part.
However, attorneys with Paul, Weiss, Rifkind, Wharton &
Garrison, which represented Napoli Kaiser and the individual
partners argued that the plaintiffs' claims against Napoli
Kaiser were "inextricably intertwined" with Judge Freedman's
approval of the state settlement and, therefore, the case should
be dismissed for lack of federal subject matter jurisdiction
under the Rooker-Feldman doctrine, the Law Journal reports.
Judge Swain though stated that she did not have to reach the
issue by saying, "While Plaintiffs' claims regarding the manner
in which the settlements were effected and the way that
settlement amounts were distributed do implicate the validity of
the state court order affirming the fairness, reasonableness and
ethical propriety of the settlements, the Court notes that some
questions have been raised regarding the propriety of applying
the Rooker-Feldman doctrine in a legal malpractice action such
as this one."
She added that the issue need not be resolved because she was
declining to exercise subject matter jurisdiction "given that
the parties exercised valid arbitration agreements and
Plaintiffs' claims are within the scope of those agreements."
Though agreeing that their claims fell within the scope of the
arbitration clauses in the retainer agreements they signed with
Napoli Kaiser, the plaintiffs nonetheless contended the
inclusion of the clauses constituted a breach of fiduciary duty.
According to the plaintiffs, they had no idea the retainer
agreements mailed to them contained arbitration clauses and
Napoli Kaiser made no effort to highlight the causes, or explain
their meaning, which they alleged violated the attorneys'
obligations as outlined in certain ethics opinions.
Still, Judge Swain, noting federal and New York state public
policies favoring enforcement of arbitration agreements, stated,
"the ethics opinions cited by Plaintiffs are not binding in the
Court and plaintiffs have not demonstrated fraud or the use of
undue influence on the part of the Defendants." Moreover, she
added, "an arbitration clause does not necessarily favor one
party over another" and the plaintiffs have not shown that
Napoli Kaiser "had reason to believe that the named Plaintiffs
did not fully comprehend the arbitration clause in their
respective retainer agreements." The judge thus dismissed the
cases without prejudice for the plaintiffs to pursue
arbitration.
The suit is styled, "Buckwalter v. Napoli, Bern & Kaiser, 01
Civ. 10868," filed in the United States District Court for the
Southern District of New York, under Judge Laura Taylor Swain.
Representing the Plaintiffs were Christopher Lovell and Gary S.
Jacobson of Lovell & Stewart. Gerard E. Harper, John Baughman
and Eric Alan Stone of Paul Weiss represented the Defendants.
NEXTEL PARTNERS: NY Court Preliminarily Approves Suit Settlement
----------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Nextel
Partners, Inc., two of its executive officers and four of the
underwriters involved in its initial public offering. The
lawsuit is captioned "Keifer v. Nextel Partners, Inc., et al.,
No. 01 CV 10945."
The Suit was filed on behalf of all persons who acquired the
Company's common stock between February 22, 2000 and December 6,
2000 and initially named as defendants the Company, John
Chapple, its president, chief executive officer and chairman of
the board, John D. Thompson, its chief financial officer and
treasurer until August 2003, and the following underwriters of
its initial public offering:
(1) Goldman Sachs & Co.,
(2) Credit Suisse First Boston Corporation (predecessor of
Credit Suisse First Boston LLC),
(3) Morgan Stanley & Co. Incorporated and
(4) Merrill Lynch Pierce Fenner & Smith Incorporated.
Mr. Chapple and Mr. Thompson have been dismissed from the
lawsuit without prejudice. The complaint alleges that the
defendants violated the Securities Act and the Exchange Act by
issuing a registration statement and offering circular that were
false and misleading in that they failed to disclose that:
(i) the defendant underwriters allegedly had solicited and
received excessive and undisclosed commissions from
certain investors who purchased the Company's common
stock issued in connection with its initial public
offering; and
(ii) the defendant underwriters allegedly allocated shares
of the Company's common stock issued in connection with
its initial public offering to investors who allegedly
agreed to purchase additional shares of the Company's
common stock at pre-arranged prices.
The complaint seeks rescissionary and/or compensatory damages.
The plaintiffs and the issuing company defendants, including the
Company, have reached a settlement of the issues in the lawsuit.
The proposed settlement, which is not material to the Company,
is subject to a number of contingencies, including negotiation
of a settlement agreement and its approval by the Court. In June
2004, an agreement of settlement was submitted to the Court for
preliminary approval.
The suit is styled "Keifer v. Nextel Partners, Inc., et al., No.
01 CV 10945," related to "In re Initial Public Offering
Securities Litigation, Master File No. 21 MC 92 (SAS)," filed in
the United States District Court for the Southern District of
New York under Judge Shira A. Scheindlin. The plaintiff firms
in this litigation are:
(a) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(b) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(c) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(d) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(e) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(f) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
NEXTEL PARTNERS: Appeal of Wireless Phone Suit Dismissal Heard
--------------------------------------------------------------
The United States Fourth Circuit Court of Appeals heard
plaintiffs' appeal of the dismissal of the class action filed
against Nextel Partners, Inc. and several other wireless
carriers and manufacturers of wireless telephones in the United
States District Court for the District of Maryland, captioned
"Riedy Gimpelson vs. Nokia, Inc., et al, Civil Action No. 2001-
CV-3893."
Reidy Gimpelson filed the suit on June 8, 2001 in the Superior
Court of Fulton County, Georgia, alleging that the defendants,
among other things, manufactured and distributed wireless
telephones that cause adverse health effects. The plaintiffs
seek compensatory damages, reimbursement for certain costs
including reasonable legal fees, punitive damages and injunctive
relief. The defendants timely removed the case to Federal court
and this case and related cases were consolidated in the United
States District Court for the District of Maryland.
On March 5, 2003, the court granted the defendants' consolidated
motion to dismiss the plaintiffs' claims. The plaintiffs have
appealed to the United States Court of Appeals for the Fourth
Circuit. The appeal is fully briefed.
The suit is styled "In re Wireless Telephone Radio Frequency
Emissions Products Liability Litigation, case no. 1:01-md-01421-
CCB," filed in the United States District Court in Maryland,
under Judge Catherine C. Blake.
Representing the plaintiffs is Mayer Morganroth, Morganroth and
Morganroth PLLC, 3000 Town Cntr Ste 1500, Southfield, MI 48075,
Phone: 1-248-355-3084, Fax: 1-248-355-3017, E-mail:
jgurfinkel@morganrothlaw.com. Representing the Company is
Kenneth L. Thompson and Michael E. Yaggy, DLA Piper Rudnick Gray
Cary US LLP, 6225 Smith Ave, Baltimore, MD 21209-3600, Phone:
1-410-580-3000, Fax: 1-410-580-3001, E-mail:
kenneth.thompson@dlapiper.com, michael.yaggy@dlapiper.com;
Anthony Michael Conti, Conti and Fenn LLC, 36 S Charles St Ste
2501, Baltimore, MD 21201, Phone: 1-410-837-6999, Fax:
1-410-510-1647, E-mail: tony@contifenn.com.
NEXTEL PARTNERS: Appeals Court Affirms Securities Suit Dismissal
----------------------------------------------------------------
The United States Eighth Circuit Court of Appeals affirmed the
settlement for the amended class action filed against Nextel
Partners, Inc., Nextel Communications, Inc. and Nextel West
Corporation, and other Nextel companies.
Several suits were initially filed, namely:
(1) Rolando Prado v. Nextel Communications, et al, Civil
Action No. C-695-03-B, filed on April 1, 2003, in the
93rd District Court of Hidalgo County, Texas;
(2) Steve Strange v. Nextel Communications, et al, Civil
Action No. 01-002520-03, filed May 2, 2003, in the
Circuit Court of Shelby County for the Thirtieth
Judicial District at Memphis, Tennessee;
(3) Christopher Freeman and Susan and Joseph Martelli v.
Nextel South Corp., et al, Civil Action No. 03-CA1065,
filed on May 3, 2003, in the Circuit Court of the
Second Judicial Circuit in and for Leon County, Florida
against Nextel Partners Operating Corporation d/b/a
Nextel Partners and Nextel South Corporation d/b/a
Nextel Communications;
(4) Nick's Auto Sales, Inc. v. Nextel West, Inc., et al,
Civil Action No. BC298695, filed on July 9, 2003 in Los
Angeles Superior Court, California against the Company,
Nextel Communications, Nextel West, Inc., Nextel of
California, Inc. and Nextel Operations, Inc;
(5) Andrea Lewis and Trish Zruna v. Nextel Communications,
Inc., et al, Civil Action No. CV-03-907, filed on
August 7, 2003, in the Circuit Court of Jefferson
County, Alabama against the Company and Nextel
Communications, Inc.
On October 3, 2003, an amended complaint for a purported class
action lawsuit was filed in the United States District Court for
the Western District of Missouri. The amended complaint named
the Company and Nextel Communications, Inc. as defendants;
Nextel Partners was substituted for the previous defendant,
Nextel West Corporation. The lawsuit is captioned "Joseph
Blando v. Nextel West Corp., et al, Civil Action No. 02-0921."
All of these complaints allege that the Company, in conjunction
with the other defendants, misrepresented certain cost-recovery
line-item fees as government taxes. Plaintiffs seek to enjoin
such practices and seek a refund of monies paid by the class
based on the alleged misrepresentations. Plaintiffs also seek
attorneys' fees, costs and, in some cases, punitive damages.
On October 9, 2003, the court in the Blando Case entered an
order granting preliminary approval of a nationwide class action
settlement that encompasses most of the claims involved in these
cases. On April 20, 2004, the court approved the settlement.
On May 27, 2004, various objectors and class members appealed to
the United States Court of Appeals for the Eighth Circuit. On
February 1, 2005, the appellate court affirmed the settlement.
On February 15, 2005, one of the objectors petitioned for a
rehearing. Distribution of settlement benefits is stayed until
the appellate court issues a final order resolving the appeal.
NEXTEL PARTNERS: Shareholders Launch Fraud Suit V. Sprint Merger
----------------------------------------------------------------
Nextel Partners, Inc. faces three class actions filed in the
Court of Chancery of the State of Delaware, relating to the
Company's proposed merger with Sprint Corporation. The suits
also names as defendants:
(1) Nextel WIP Corporation,
(2) Nextel Communications, Inc.,
(3) Sprint Corporation, and
(4) several of the members of the Company's board of
directors
The suits are styled:
(i) Dolores Carter v. Nextel WIP Corp., et al.
(ii) Donald Fragnoli v. Nextel WIP Corp., et al, Civil
Action No. 955-N
(iii) Selena Mintz v. John Chapple, et al, Civil Action No.
1065-N
In all three lawsuits, the plaintiffs seek declaratory and
injunctive relief declaring that the announced merger
transaction between Sprint Corporation and Nextel is an event
that triggers the put right set forth in the Company's restated
certificate of incorporation and directing the defendants to
take all necessary measures to give effect to the rights of the
Company's Class A common stockholders arising therefrom.
The Company said in a disclosure to the Securities and Exchange
Commission that the allegations in the lawsuits to the effect
that the Nextel Partners defendants may take action, or fail to
take action, that harms the interests of our public stockholders
are without merit. The Company believes that the Sprint-Nextel
merger transaction, if successfully closed, will trigger the put
rights set forth in its restated certificate of incorporation.
PRIMUS KNOWLEDGE: NY Court Preliminarily Okays Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Primus
Knowledge Solutions, Inc., an officer and a former officer, and
FleetBoston Robertson Stephens, Inc., J.P. Morgan Securities
Inc., U.S. Bancorp Piper Jaffray Inc., CIBC World Markets, Dain
Rauscher, Inc. and Salomon Smith Barney Holdings Inc., the
underwriters of the Company's initial public offering.
The suit was filed in December 2001 on behalf of persons who
purchased Primus common stock from June 30, 1999 to December 6,
2000, which was issued pursuant to the June 30, 1999
registration statement and prospectus for the Company's initial
public offering. This is one of a number of actions coordinated
for pretrial purposes.
Plaintiffs in the coordinated proceeding have brought claims
under the federal securities laws against numerous underwriters,
companies, and individuals, alleging generally that defendant
underwriters engaged in improper and undisclosed activities
concerning the allocation of shares in the IPOs of more than 300
companies during the period from late 1998 through 2000.
Specifically, among other things, the plaintiffs allege that the
prospectus pursuant to which shares of the Company's common
stock were sold in the IPO contained certain false and
misleading statements regarding the practices of the Company's
underwriters with respect to their allocation of shares of
common stock in the Company's IPO to their customers and their
receipt of commissions from those customers related to such
allocations, and that such statements and omissions caused the
Company's post-IPO stock price to be artificially inflated.
The individual defendants have been dismissed from the action
without prejudice pursuant to a tolling agreement. In June 2003,
the plaintiffs in this action announced a proposed settlement
with the issuer defendants and their insurance carriers. The
Company elected to participate in the settlement, which
generally provides that plaintiffs will dismiss and release all
claims against the Company and the individual defendants in
exchange for a contingent payment by the insurance companies
collectively responsible for insuring the issuers in all of the
consolidated IPO cases, and for the assignment or release of
certain potential claims that the Company may have against the
underwriters. The Company will not be required to make any cash
payments in the settlement, unless the pro rata amount paid by
the insurers in the settlement on its behalf exceeds the amount
of the insurance coverage, a circumstance that it believes is
not likely to occur.
A stipulation of settlement of claims against the issuer
defendants, including the Company, was submitted to the Court
for preliminary approval in June 2004. On February 15, 2005, the
Court preliminarily approved the settlement contingent on
specified modifications. The settlement is subject to final
Court approval, after proposed settlement class members have an
opportunity to object, and a number of other conditions.
RAZORFISH INC.: NY Court Preliminarily Approves Suit Settlement
---------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the consolidated
securities class action filed against Razorfish, Inc. and:
(1) Credit Suisse First Boston Corp.,
(2) BancBoston Robertson Stephens Inc.,
(3) BT Alex. Brown Inc.,
(4) Lehman Brothers, Inc.,
(5) Jeffrey A. Dachis,
(6) Craig M. Kanarick,
(7) Per I.G. Bystedt,
(8) Jonas S.A. Svensson,
(9) Susan Black,
(10) Carter F. Bales,
(11) Kjell A. Nordstrom and
(12) John Wren
The complaint alleges that the prospectus and the registration
statement for the initial public offering (IPO) failed to
disclose that the underwriters allegedly solicited and received
"excessive" commissions from investors and that some investors
in the IPO allegedly agreed with the underwriters to buy
additional shares in the aftermarket in order to inflate the
price of the Company's stock. The complaint asserts claims
against the Company and its officers and directors pursuant to
Section 11 of the Securities Act of 1933, Section 10(b) of the
Exchange Act of 1934, and other related provisions. The
complaint seeks unspecified damages, attorney and expert fees,
and other unspecified litigation costs.
On July 15, 2002, the Company, along with other issuer
defendants in the coordinated cases, moved to dismiss the
litigation. On February 19, 2003, the court ruled on the
motions. The court denied the Company's motion to dismiss the
claims against it under Rule 10b-5. The motions to dismiss the
claims under Section 11 of the Securities Act were denied as to
virtually all of the defendants in the consolidated cases,
including Razorfish. In addition, the court granted the motion
to dismiss the Rule 10b-5 claims as to individual defendants
Jeffrey A. Dachis, Craig M. Kanarick, Per I.G. Bystedt, Jonas
S.A. Svensson and Kjell A. Nordstrom. The Company's other
officers named as individual defendants, Susan Black, Carter F.
Bales and John Wren, signed a tolling agreement and were
dismissed from the action without prejudice on October 9, 2002.
A proposed settlement of this litigation was structured between
the plaintiffs, the issuer defendants in the consolidated
actions, the issuer officers and directors named as defendants,
and the issuers' insurance companies. On July 31, 2003, the
Company conditionally approved the proposed partial settlement.
The settlement would provide, among other things, a release of
the Company and of the individual defendants for the conduct
alleged to be wrongful in the consolidated complaint. The
Company would agree to undertake other responsibilities under
the settlement, including agreeing to assign away, not assert,
or release certain potential claims it may have against its
underwriters. Any direct financial impact of the proposed
settlement is expected to be borne by its insurance carriers.
In June 2004, an agreement of settlement was submitted to the
court for preliminary approval. The court requested that any
objections to preliminary approval of the settlement be
submitted by July 14, 2004, and the underwriter defendants
formally objected to the settlement. The plaintiffs and issuer
defendants separately filed replies to the underwriter
defendants' objections to the settlement on August 4, 2004. The
court granted the motion for preliminary approval, and now
notice will be given to all class members of the settlement, a
"fairness" hearing will be held and if the court determines that
the settlement is fair to the class members, the settlement will
be approved. There can be no assurance that this proposed
settlement would be finally approved and implemented in its
current form, or at all.
The suit is styled "In re Razorfish, Inc. Initial Public
Offering Sec. Litigation," related to "In re Initial Public
Offering Securities Litigation, Master File No. 21 MC 92 (SAS),"
filed in the United States District Court for the Southern
District of New York under Judge Shira A. Scheindlin. The
plaintiff firms in this litigation are:
(i) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(ii) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(iii) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(iv) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(v) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(vi) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
RIDLEY INC.: Faces Suits Over BSE Crisis, Expects More To Come
--------------------------------------------------------------
Ridley Inc., (TSX:RCL) disclosed that it has become aware that a
class action lawsuit had been filed by a Quebec farmer against
the Solicitor General of Canada, the Ministry of Agriculture
Canada and Ridley Inc. claiming damages allegedly suffered due
to the closing of the U.S. border to Canadian cattle exports in
May, 2003 after the discovery of a BSE infected cow in Alberta,
Canada.
The company has also disclosed that similar lawsuits were
expected to be filed in other Canadian provinces. Ridley Inc.
has now obtained copies of the statements of claims that have
been filed in Alberta, Saskatchewan and Ontario. Ontario has
been proposed as the jurisdiction for any potential claimants
residing in the remaining Canadian provinces.
Ridley Inc. has not yet formally been served with all of the
statements of claim but a review of the court filings indicates
that the allegations against Ridley Inc. are substantially
similar. As previously reported by Ridley Inc., the allegations
are that it should have unilaterally discontinued using ruminant
meat and bone meal in its cattle feed even prior to the
enactment of uniform U.S. and Canadian regulations banning their
use in August 1997. In the more recent filings it is alleged
that Ridley Inc. was the supplier of feed to the affected
Alberta cow early in its life before the 1997 ban was in effect.
Nothing in any of the four filings directly connects Ridley Inc.
to any of the complainants.
According to newspaper articles and media releases issued
earlier this week which were attributed to the Ontario
plaintiff's counsel, the filings in the four provinces appear to
be a co-ordinated effort by 4 or 5 plaintiffs to encourage
others to join them in class action law suits to seek
compensation from the Federal Government in connection with the
U.S./Canada border closure to Canadian beef. "Unfortunately,
Ridley Inc. has been included in these actions without any
justification insofar as we are aware," said Ridley Inc.
President and CEO, Steven VanRoekel.
At the conclusion of the Canadian Food Inspection Agency's May,
2003 BSE investigation authorities found no wrongdoing on the
part of Ridley Inc. Mr. Steven VanRoekel repeated Ridley Inc.'s
previous statement that "we take the threat of BSE very
seriously; food safety and quality assurance continue to be a
top priority for us and we have at all times been in full
compliance with CFIA standards relevant to the May, 2003 BSE
case". Ridley Inc. discontinued the use of ruminant meat and
bone meal in its cattle feed formulae prior to the CFIA ban.
"When we learned of the court filing in Quebec, we immediately
took steps to disclose this information and to alert the market
to the possibility of these additional class actions" Mr.
VanRoekel said. "Now that these three additional filings have
been made, we will proceed to vigorously defend our position."
Ridley Corporation Limited of Sydney, Australia, which owns 70%
of Ridley Inc. is also identified as a defendant in the Ontario,
Saskatchewan and Alberta filings. Compensation damages are
sought from the named defendants in each of the filings. In
addition, the Alberta filing seeks punitive damages against
Ridley Inc. and Ridley Corporation Limited of an unspecified
amount and each of the Ontario and Saskatchewan filings allege
punitive damages against them in the amount of $100,000,000.
Ridley Inc. understands that it is not unusual for plaintiffs to
allege damages in excessive amounts; actual damages, if any,
must be proven to the satisfaction of the courts.
Ridley Inc., headquartered in Mankato, Minnesota and Winnipeg,
Manitoba, is one of North America's leading commercial animal
nutrition companies. Ridley Inc. manufactures and/or distributes
a full range of animal nutrition products under a number of
highly regarded trade names.
SEQUENOM INC.: NY Court Preliminarily Approves Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York granted preliminary approval to the settlement of the
consolidated securities class action filed against Sequenom,
Inc. and certain of its current or former officers and
directors, styled "In re Sequenom, Inc. IPO Securities
Litigation Case No. 01-CV-10831."
Similar complaints were filed in the same Court against hundreds
of other public companies that conducted initial public
offerings of their common stock in the late 1990s and 2000. In
the complaint, the plaintiffs allege that the Company's
underwriters, certain of its officers and directors and the
Company violated the federal securities laws because our
registration statement and prospectus contained untrue
statements of material fact or omitted material facts regarding
the compensation to be received by and the stock allocation
practices of the underwriters. The plaintiffs seek unspecified
monetary damages and other relief.
In October 2002, the Company's officers and directors were
dismissed without prejudice pursuant to a stipulated dismissal
and tolling agreement with the plaintiffs. In February 2003,
the court dismissed the claim against the Company brought under
Section 10(b) of the Securities Exchange Act of 1934, without
giving the plaintiffs leave to amend the complaint with respect
to that claim. The court declined to dismiss the claim against
the Company brought under Section 11 of the Securities Act of
1933.
In June 2003, pursuant to the authorization of a special
litigation committee of the Company's Board of Directors, the
Company approved in principle a settlement offer by the
plaintiffs. In June 2004, the Company entered into a settlement
agreement with the plaintiffs. On February 15, 2005, the Court
issued a decision certifying a class action for settlement
purposes and granting preliminary approval of the settlement
subject to modification of certain bar orders contemplated by
the settlement. In addition, the settlement is still subject to
statutory notice requirements as well as final judicial
approval.
The suit is styled "In re Sequenom, Inc. IPO Securities
Litigation Case No. 01-CV-10831" related to "In re Initial
Public Offering Securities Litigation, Master File No. 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(6) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
SPECTRASITE BUILDING: Plaintiffs Appeal Antitrust Suit Dismissal
----------------------------------------------------------------
Plaintiffs appealed the dismissal of the class action filed
against SpectraSite Building Group, Inc., the Building Owners
and Managers Association of New York (BOMA), real estate
investment trusts, privately held commercial real estate
companies in the United States District Court for the Southern
District of New York.
On April 23, 2004, Winstar Communications, LLC and Winstar
of New York, LLC (collectively, "Winstar") filed the suit
against owners and managers of commercial real estate properties
that have entered into leases or other arrangements with
Winstar. The suit asserts claims for violations of federal and
state antitrust law, and federal telecommunications law, and
seeks an unspecified amount of monetary damages and specific
performance. The claims are premised upon the allegations,
among others, that the defendants, through BOMA and other
rooftop telecommunications managers, including SpectraSite
Building Group, Inc., conspired to fix rental prices of building
access for telecommunications services by disseminating non-
public pricing information among the defendants that stabilized
building access rates for competitive telecommunications
providers such as Winstar.
On August 13, 2004, the defendants filed a motion to dismiss the
action. On January 14, 2005, Winstar voluntarily dismissed its
claims regarding violations of federal telecommunications law
and its claims for relief for specific performance, leaving the
antitrust claims for further adjudication. On January 21, 2005,
the Court granted the defendant's motion to dismiss, dismissing
all of Winstar's claims including its antitrust claims, and
directed the Clerk of Court to close the case. On February 18,
2005, Winstar filed a notice of appeal of the Court's dismissal
order with the United States Court of Appeals, Second Circuit.
The suit is styled "Winstar Communications, L.L.C. et al v.
Equity Office Properties Inc. et al., case no. 1:04-cv-03139-
KMW," filed in the United States District Court for the Southern
District of New York, under Judge Kimba M. Wood. Representing
the Company is Hunton & Williams LLP, One Hannover square, Suite
1400 421 Fayetteville Street Mall PO Box 109 Raleigh, NC 27601
Phone: 919-899-3000. Representing the plaintiffs is Robert
Emmet Crotty Kelley Drye & Warren LLP 101 Park Avenue New York,
NY 10178 Phone: 212-808-7847 Fax: 212-808-7897 E-mail:
rcrotty@kelleydrye.com.
THESTREET.COM: NY Court Preliminarily Approves Suit Settlement
--------------------------------------------------------------
The United States District Court for the Southern District of
New York preliminarily approved the consolidated securities
class action filed against TheStreet.com, Inc., certain of its
former officers and directors and James J. Cramer, a current
director, and certain underwriters of the Company's initial
public offering:
(1) The Goldman Sachs Group, Inc.,
(2) Chase H& Q,
(3) Thomas Weisel Partners LLC,
(4) FleetBoston Robertson Stephens, and
(5) Merrill Lynch Pierce Fenner & Smith, Inc.
On December 5, 2001, a class action lawsuit alleging violations
of the federal securities laws was filed. Plaintiffs allege
that the underwriters of the Company's initial public offering
violated the securities laws by failing to disclose certain
alleged compensation arrangements (such as undisclosed
commissions or stock stabilization practices) in the offering's
registration statement. The plaintiffs seek damages and
statutory compensation against each defendant in an amount to be
determined at trial, plus pre-judgment interest thereon,
together with costs and expenses, including attorneys' fees.
Similar suits were filed against over 300 other issuers that had
initial public offerings between 1998 and December 2001, and
they have all been consolidated into a single action. Pursuant
to a Court Order dated October 9, 2002, each of the individual
defendants to the action, including Mr. Cramer, has been
dismissed without prejudice. On June 8, 2004, the Company and
its individual defendants (together with the Company's insurance
carriers) entered into a settlement with the plaintiffs. The
settlement is subject to a hearing on fairness and approval by
the court overseeing the litigation.
Although the lawsuit against the Company is an independent cause
of action vis-a-vis the lawsuits pending against other issuers
in the consolidated proceeding, and no issuer is liable for any
wrongdoing allegedly committed by any other issuer, the proposed
settlement between the plaintiffs and the issuers is being done
on a collective basis and includes all but one of the 299 issuer
defendants eligible to participate. Generally, under the terms
of the settlement, in exchange for the delivery by the insurers
of the Company and the other defendants of an undertaking
guaranteeing that the plaintiffs will recover, in the aggregate,
$1 billion from the underwriters (the "Recovery Deficit"), and
the assignment to the plaintiffs by the issuers of their
interests in claims against the underwriters for excess
compensation in connection with their IPOs, the plaintiffs will
release the non-bankrupt issuers from all claims against them
(the bankrupt issuers will receive a covenant not to sue) and
their individual defendants. The Recovery Deficit payable by
the insurers to the plaintiffs will be equal to the difference,
if any, between $1 billion and the actual amount the plaintiffs
recover from the underwriters by reason of the IPO litigation
and the assigned claims. Neither the Company nor any other
issuer will be required to pay any portion of the Recovery
Deficit, if any, and the insurers will cover all further legal
defense costs incurred by the issuers, as well as notice costs
and administrative costs and expenses.
Pursuant to an Opinion and Order dated February 15, 2005, the
settlement was preliminarily approved by the court, subject to
certain minor modifications. In the event the settlement does
not receive final court approval and the Company or any of its
individual defendants is reinstated as a defendant in the
lawsuit, any unfavorable outcome of this litigation could have
an adverse impact on the Company's business, financial
condition, results of operations, and cash flows.
The suit is styled "In re TheStreet.com, Inc. IPO Securities
Litigation Case No. 01-CV-10831" related to "In re Initial
Public Offering Securities Litigation, Master File No. 21 MC 92
(SAS)," filed in the United States District Court for the
Southern District of New York under Judge Shira A. Scheindlin.
The plaintiff firms in this litigation are:
(1) Bernstein Liebhard & Lifshitz LLP (New York, NY), 10 E.
40th Street, 22nd Floor, New York, NY, 10016, Phone:
800.217.1522, E-mail: info@bernlieb.com
(2) Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
(3) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
(4) Sirota & Sirota, LLP, 110 Wall Street 21st Floor, New
York, NY, 10005, Phone: 888.759.2990, Fax:
212.425.9093, E-mail: Info@SirotaLaw.com
(5) Stull, Stull & Brody (New York), 6 East 45th Street,
New York, NY, 10017, Phone: 310.209.2468, Fax:
310.209.2087, E-mail: SSBNY@aol.com
(6) Wolf, Haldenstein, Adler, Freeman & Herz LLP, 270
Madison Avenue, New York, NY, 10016, Phone:
212.545.4600, Fax: 212.686.0114, E-mail:
newyork@whafh.com
TREX CO.: NJ Court Approves Settlement of Consumer Fraud Lawsuit
----------------------------------------------------------------
The Superior Court of New Jersey, Essex County granted final
approval of the settlement of the class action filed against
Trex Co., Inc., alleging that it violated state and common laws.
Michael Kanefsky filed the suit on July 28, 2000, generally
alleging that the company has violated state and common law by
negligently misrepresenting the characteristics of its products,
by breaching contracts, by breaching implied or express
warranties and/or by defrauding consumers in the sale and
promotion of these products. The plaintiffs sought reformation
of the Company's warranty, as well as compensatory damages in an
unspecified amount.
On May 28, 2004, the court certified the following three class
action cases again the company:
(1) a nationwide class for reformation of warranty;
(2) a New Jersey class for alleged violation of the New
Jersey Consumer Fraud Act; and
(3) a New Jersey class for alleged breach of express and
implied warranties.
On August 24, 2004, the court preliminarily approved a proposed
settlement of the action. Class members received the proposed
settlement notice from the Company. On December 17, 2004, the
court granted final settlement approval. Although the Company
denies the allegations in the complaint, and believes that the
court erred in certifying the classes, pursuant to the terms of
the settlement, it has agreed that upon proper proof of claim,
it will replace, at its sole expense (including labor), any
class member's product that exhibits certain specified
characteristics. The Company has also agreed to modify its
warranty in certain respects, and to discontinue certain
advertising claims. The settlement does not include the payment
of any monetary damages by the company (other than $10,000 to
each of the four named plaintiffs), although the company agreed
to pay $1,750,000 in legal fees to plaintiffs' counsel.
UNITED STATES: Canadian Group Promises Damages Lawsuit V. R-CALF
----------------------------------------------------------------
A new group of Canadian cattle producers known as the Fair
Market Beef plans to file a class action suit for damages
against R-CALF in Billings, Montana, The Billings Gazette
reports.
According to John Morrison, a cattleman and grain grower who
lives outside Winnipeg, Manitoba, anyone who has suffered a
financial loss since March 7 as a result of R-CALF's actions is
eligible to be part of the class action suit.
It was on March 7 that the Billings-based Ranchers Cattlemen
Action Legal Fund - United Stockgrowers of America persuaded the
U.S. federal court to prevent the opening of the U.S. border to
Canadian live cattle under 30 months of age.
In a telephone interview from his home in Rosser, Manitoba, Mr.
Morisson told the Gazette that the Canadian group includes
members from the United States and that membership is by check
for $20. He also told The Billings Gazette, "R-CALF should
rethink their position. We are going after their executives and
members."
The focal point of Fair Market Beef's anger is based on R-CALF
allegations that Canadian live cattle pose a threat to U.S.
herds and consumers. Mr. Morrison said Canadian cattle are
actually safer than U.S. cattle because Canada has a mandatory
individual animal identification program in place, while the
United States does not.
R-CALF asked the court to bar the U.S. Department of Agriculture
from implementing its "final rule" proposed in December that
found the threat of bovine spongiform encephalopathy in the
Canadian herd was a "minimal risk." R-CALF contends in its
lawsuit that there are volumes of scientific data suggesting
Canada's risk status should not be considered minimal. Asked
about the planned legal action against them, Shae Dodson,
spokeswoman for R-CALF, told The Gazette, the threatened suit
"is not one of our priorities. We have not heard from their
legal counsel. We have nothing official to work on."
The proposed suit is the result of District Judge Richard
Cebull's issuing a preliminary injunction against the U.S.
Department of Agriculture, which intended to open the U.S.
border March 7 under its newly formulated "minimum risk" rule.
Judge Cebull subsequently set a trial date of July 27 on R-
CALF's request for a permanent injunction. Mr. Morrison said
that if R-CALF delays the July hearing, FMB would ask for a
surety bond of $7 million a day to be imposed on R-CALF.
The border was closed in May 2003 when a cow with bovine
spongiform encephalopathy, or mad cow disease, was found in
Alberta. Two more cases of BSE were identified in January after
USDA published its final rule, setting off a 60-day comment
period. A dairy cow of Canadian origin was discovered in
Washington in December 2003. BSE is a brain-wasting disease
that causes the animal to lose its neuromuscular control. It is
caused by deformed proteins in the brain and central nervous
system of the infected animal and is always fatal.
A human form of BSE called variant Creutzfeldt-Jakob disease was
identified in Great Britain in 1995 and since then about 150
people in the United Kingdom have died from vCJD. Another 11
people have died in Europe. There has been one reported death in
the United States from vCJD. The BSE transferred to humans who
consumed tissues - brain and spinal cord - from cattle infected
with BSE, which scientists believed developed from feeding
rendered animal parts from ruminants such as sheep, cattle and
goats.
UNITED STATES: Court OKs $21.9M Payment to Holocaust Survivor
-------------------------------------------------------------
In the largest single award against Swiss banks who betrayed
their clients to the Nazis, a U.S. court approved a payment of
$21.9 million to an elderly Los Angeles woman and a dozen
relatives, 65 years after their family's fortune was stolen, The
Times Online reports.
The award stemmed from a claim by a Holocaust survivor, Maria
Altmann, 89, and about two dozen other, unnamed heirs of
Ferdinand Bloch-Bauer and Otto Pick, both big shareholders in
one of Austria's largest prewar sugar refineries.
Legal experts believe that the award is the latest originating
from a $1.25 billion fund created in 1998 after a consortium of
Swiss banks settled a class-action lawsuit brought by thousands
of Holocaust survivors whose accounts and businesses were
transferred by Swiss financial institutions in an attempt to
curry favor with the Nazis.
The victims and their families had initiated the lawsuit against
Credit Suisse Group, UBS AG and other banks, accusing them of
stealing, concealing or sending the Nazis hundreds of millions
of dollars worth of Jewish holdings and destroying millions of
bank records. Mrs. Altmann's case began in the dramatic days
before the Nazi annexation of her native Austria, in March 1938.
Eight days before the Anschluss, her uncle, Herr Bloch-Bauer,
and Herr Pick, the patriarchs of two prominent Jewish Viennese
families, raced to a Swiss bank in an attempt to protect their
interest in the sugar refinery. They asked to transfer their
shares to a bank in Zurich.
According to the Claims Resolution Tribunal in New York, which
adjudicates each claim, the bank, which was unnamed in the
recent ruling, guaranteed that the shares would not be sold
without the families' consent, however after family members were
arrested or fled the country, the banks bowed to pressure to
transfer the shares to a German investor in a Nazi campaign to
steal Jewish-owned businesses. The tribunal also stated that
the case demonstrated that "having marketed themselves to the
Jews of Europe as a haven for their property, Swiss banks turned
Jewish-owned property over to the Nazis to curry favor with
them". Though no records of the Jewish shareholders' deal with
the bank were found in its files, the tribunal instead relied on
documents provided by the heirs and independent archives.
"We will never know how many other examples of betrayal were
buried in the records of the 2,757,950 accounts . . . the banks
concede they have destroyed," the tribunal said.
Mrs. Altmann never realized that the banks had passed on her
family's fortune until her lawyer persuaded her to file a claim
with the tribunal. She also said, "It's like a beautiful
fairytale. And an ugly one for the Swiss banks. I never dreamt
there was so much money stolen from our family. It is
unbelievable for me to grasp that there were people doing such
things, and especially a bank."
The previous highest individual award, of the $254 million
awarded so far, was $4 million. On average, most payments have
averaged around $130,000.
WAL-MART STORES: Recalls 220T Recorders Due To Poison Hazard
------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Wal-Mart Stores, Inc., of Bentonville, Arkansas, which
is part of the Maytag Corporation, is voluntarily recalling
about 220,000 Nu-Tronix Karaoke Cassette Player/Recorders
The paint on the five control buttons of the karaoke player
contains excessive lead, posing a lead poisoning hazard to young
children. Lead poisoning in children is associated with
behavioral problems, learning disabilities, hearing problems,
and growth retardation.
This recall includes the Nu-tronix Karaoke Cassette Player and
Recorder with digital radio and alarm features. A microphone,
with a white cord is attached to the cassette player. "Nu-
tronixT" is printed on the front of the product. The karaoke
player is gray with a purple handle and a purple cassette cover.
The karaoke player is sold with two cassette tapes with
children's songs, a multifunctional microphone and lyric sheets.
Manufactured in China, Wal-Mart stores nationwide from June 2003
through March 2005 for about $20.
Consumers should return the recalled karaoke players to their
nearest Wal-Mart store to receive a refund. Contact Wal-Mart at
(800) 925-6278 between 7 a.m. and 9 p.m. CT Monday through
Friday. or visit the firm's Web site:
http://www.walmartstores.comand click on "Product Recalls" for
more information or submit questions on the "Store Feedback"
link.
WASHINGTON: Judge Grants Certification To WA Workers' Lawsuit
-------------------------------------------------------------
In a recent decision by King County Superior Court Judge Mary Yu
that made a lawsuit against the University of Washington a class
action, thousands of faculty members could be eligible for
millions of dollars in combined unpaid salary raises, The UW
Daily Online reports.
According to court documents Duane Storti, an associate
professor in mechanical engineering, initiated a lawsuit last
year arguing that the UW violated University policy by not
giving faculty a pay raise for the 2002-03 school year.
In her ruling, Judge Yu wrote, "Because the class includes
thousands of faculty members, and each class member's claim is
relatively small, jointer of all class members would be
impracticable."
Though the UW Daily Online reached Mike Madden, the UW's
attorney on the case, for comment he only stated that the
University argued against a class-action ruling because leaders
of the Faculty Senate the faculty's governing body did not side
with Mr. Storti's claims.
While Judge Yu noted the Faculty Senate as a representative of
faculty and the UW, she indicated, "there is no factual or legal
basis for finding that such representation bars the faculty from
filing a case of action outside of the University structure."
The suit does not specify damages, but Mr. Storti's attorneys
claim that each year, the faculty is denied a combined $4.2
million. It alleges that all professors who complete meritorious
reviews are entitled to a 2 percent pay raise.
In 2000, 2001 and 2003, faculty received a 2 percent merit pay
raise. But in 2002, the UW did not give the merit-based raises.
UW officials though contend that the University is not legally
required to grant the merit-based raises.
In a May 17, 2002 letter, then-Provost Lee Huntsman indicated
"the need to minimize unit budget cuts, the fact that there is
no legal mechanism for giving an increase to classified staff,
and the need to strengthen our case in the next legislative
session," went into the decision not to fund the 2 percent
salary increase, according to court documents.
ZEBCO HOLDINGS: Recalls 1.5M Fishing Poles Due To Injury Hazard
---------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), W.C. Bradley / Zebco Holdings Inc. doing business as
Zebco, of Tulsa, Oklahoma is voluntarily recalling about 1.5
million Children's Fishing Poles.
The paint on the rods of these fishing poles contains lead. Lead
is toxic if ingested by young children and can cause adverse
health effects. There have been no reports of injuries or
illness associated with these poles. This voluntary recall is
being conducted to prevent any possibility of injury.
The recalled fishing poles are brightly colored and feature
pictures of the following cartoon characters on the reels: from
Nickelodeon's SpongeBob Squarepantsr are SpongeBob, Patrick Star
and Sandy Cheeks; Nick Jr.'s Dora the Explorerr; Disney's
Tigger; and the cast of Nickelodeon's Rocket Powerr. "ZEBCOr"
and "Floating Catch `Em KitT" are written on the handles of
these poles with the exception of the Rocket Power poles. The
Rocket Power poles have a two-piece rod, were sold with
sunglasses and "Rocket Power" is written on the rod. Newer
fishing poles with a date code on the rod (near the handle) are
not included in the recall. Sold at: Discount department,
sporting good and toy stores nationwide from August 2001 through
March 2005 for between $9 and $13.
Manufactured in China, the poles were sold at discount
department, sporting good and toy stores nationwide from August
2001 through March 2005 for between $9 and $13.
Consumers should stop using the recalled fishing poles and
contact Zebco for information on receiving a free replacement
fishing pole.
Consumer Contact: For more information, call Zebco at
(800) 444-5581 Ext. 6217 between 8 a.m. and 4 p.m. CT Monday
through Friday, or visit the firm's Web site:
http://www.zebco.com/recall.
ZIYAD BROTHER: Recalls Tahini Due To Salmonella Contamination
-------------------------------------------------------------
Ziyad Brothers Importing is voluntarily recalling its Ziyad
brand Tahini due to possible contamination with Salmonella
Senftenberg.
The possible contamination was noted after testing by the
Minnesota Department of Agriculture and the Illinois Department
of Public Health. Salmonella Senftenberg is an organism which
can cause serious and sometimes fatal infections in young
children, frail or elderly people, and others with weakened
immune systems. Healthy persons infected with Salmonella often
experience fever, diarrhea, nausea, vomiting and abdominal pain.
In rare circumstances, infection with Salmonella can result in
the organism getting into the bloodstream and producing more
severe illnesses such as arterial infections (i.e. infected
aneurysms), endocarditis and arthritis. No illnesses have been
reported to date in connection with the Ziyad brand Tahini.
The product is distributed nationwide and is sold in glass jars
16oz., 32oz., 64oz., and a 128 oz. plastic jar. The product is
also sold in 40 pound containers labeled "Tahini 100% Crushed
Sesame Seeds Made in Lebanon packed by A.O. Ghandour Sons
S.A.L., Distributed by Ziyad Brothers Importing." There are no
lot numbers on the containers.
Production and shipment of the product has been suspended by the
Illinois Department of Public Health while the FDA and Ziyad
continue their investigation as to the source of the potential
problem.
"Although we do not know if our plain Tahini was contaminated,
we are taking the precaution of recalling the product," said a
representative of Ziyad Brothers Importing.
Consumers who have purchased Ziyad brand plain Tahini should
dispose of it or return it to the store of purchase. Consumers
with questions may contact the firm's Recall Coordinator, Sonia
Ziad, at info@ziyad.com or at 708-222-8330.
New Securities Fraud Cases
BLUE COAT: Berman DeValerio Lodges Securities Fraud Suit in CA
--------------------------------------------------------------
The law firm of Berman DeValerio Pease Tabacco Burt & Pucillo
initiated the class action in the U.S. District Court for the
Northern District of California against Blue Coat Systems, Inc.
("Blue Coat" or the "Company") (Nasdaq: BCSI), claiming that the
Company misled investors about its finances.
The lawsuit seeks damages for violations of federal securities
laws on behalf of all investors who purchased Blue Coat common
stock from February 20, 2004 through and including May 27, 2004
(the "Class Period").
The lawsuit claims that the defendants violated Sections 10(b),
20(a) and 20A of the Securities Exchange Act of 1934 and the
rules and regulations promulgated thereunder, including U.S.
Securities and Exchange Commission ("SEC") Rule 10b-5.
The complaint alleges that Blue Coat issued false and misleading
financial statements during the Class Period, artificially
inflating the Company's stock price.
Since its founding in 1996, Blue Coat never turned a profit.
Then, on February 19, 2004, Blue Coat announced an unprecedented
increase in sales and its first profitable quarter. During the
Company's conference call held after the close of trading that
same day, Blue Coat stated a belief that gross margins in the
following quarter would fall in the range of 68-69%.
This news caused the Company's stock to increase $6.75, to close
at $38.27 on February 20, 2004. Almost immediately following the
Company's positive earnings announcement, defendants started
selling massive amounts of Blue Coat stock, at prices ranging
from $40-$52 per share.
On May 27, 2004, the Company shocked investors by announcing
that the purported gross margin calculation had fallen short for
the fourth quarter of fiscal 2004 and that profitability was
lower than that achieved in the prior quarter.
On this news, shares of the Company's common stock plummeted
from $39.27, on May 27, 2004, to close at $27.80 on May 28,
2004, a drop of $11.47, or 29%.
On April 7, 2005, Blue Coat announced that the SEC had commenced
a formal investigation into the Company, focusing on "whether
certain present or former officers, directors, employees,
affiliates or others made intentional or non- intentional
selective disclosure of material nonpublic information, traded
in the Company's stock while in possession of such information,
or communicated such information to others who thereafter traded
in the Company's stock."
For more details, contact Nicole Lavallee, Esq. by Mail: 425
California Street, Suite 2100, San Francisco, CA 94104 by Pone:
(415) 433-3200 OR Jeffrey C. Block, Esq. or Julie A. Richmond,
Esq. by Mail: One Liberty Square, Boston, MA 02109 by Phone:
(800) 516-9926 or by E-mail: law@bermanesq.com or visit their
Web site: http://www.bermanesq.com/pdf/BlueCoat-Cplt.pdf.
COLLINS & AIKMAN: Federman & Sherwood Lodges Stock Lawsuit in MI
----------------------------------------------------------------
The law firm of Federman & Sherwood initiated a class action
lawsuit in the United States District Court for the Eastern
District of Michigan against Collins & Aikman Corp. (NYSE: CKC).
The complaint alleges violations of federal securities laws,
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b-5, including allegations of issuing a series of
material misrepresentations to the market which had the effect
of artificially inflating the market price. The class period is
from May 6, 2004 through March 17, 2005.
For more details, contact William B. Federman of Federman &
Sherwood by Mail: 120 N. Robinson, Suite 2720, Oklahoma City, OK
73102 by Phone: (405) 235-1560 by Fax: (405) 239-2112 by E-mail:
wfederman@aol.com or visit their Web site:
http://www.federmanlaw.com.
VEECO INSTRUMENTS: Goodkind Labaton Lodges Amended NY Stock Suit
----------------------------------------------------------------
The law firm of Goodkind Labaton Rudoff & Sucharow LLP filed an
amended class action lawsuit in the United States District Court
for the Southern District of New York, on behalf of persons who
purchased or otherwise acquired publicly traded securities of
Veeco Instruments, Inc. ("Veeco" or the "Company") (Nasdaq:VECO)
between November 3, 2003 and February 10, 2005, inclusive, (the
"Class Period"). The amended lawsuit was filed against Veeco,
Edward H. Braun and John F. Rein Jr. ("Defendants").
Since the filing of the initial complaint, Goodkind Labaton has
conducted an investigation of the issues initially alleged and
has uncovered significant material findings. These findings
include that Veeco
(1) may have violated Export Administration Regulations by
making multiple improper shipments of classified
equipment to China and Malaysia restricted based upon
national security and anti-terrorism grounds,
(2) failed to disclose that its export privileges were at
risk given this improper conduct, and
(3) omitted material information from its classification
requests to the Bureau of Industry and Security, which
if it had been disclosed, would have resulted in
adverse events for the Company.
In addition, the amended complaint contains the allegations in
the original complaint related to Defendants' statements which
were false and misleading because Defendants
(i) knowingly or recklessly failed to disclose that it had
improperly valued the inventory and accounts payable at
its TurboDisc division in order to make the acquisition
look more attractive to the market,
(ii) falsely recognized revenue at TurboDisc during the
class period, and
(iii) improperly overvalued its deferred tax assets.
For more details, contact Christopher Keller, Esq. of The Law
Firm of Goodkind Labaton Rudoff & Sucharow LLP by Phone:
800-321-0476 or visit their Web site:
http://www.glrslaw.com/get/?case=Veeco.
WATCHGUARD TECHNOLOGIES: Marc S. Henzel Lodges Stock Suit in WA
---------------------------------------------------------------
The Law Offices of Marc S. Henzel initiated a class action suit
in the United States District Court for the Western District of
Washington on behalf of purchasers of WatchGuard Technologies,
Inc. (NASDAQ: WGRD) common stock during the period between
February 12, 2004 and March 15, 2005 (the "Class Period").
The complaint charges WatchGuard and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. WatchGuard provides Internet security solutions designed
to protect small to medium-sized enterprises that use the
Internet for e-commerce and secure communications.
The complaint alleges that during the Class Period, defendants
caused WatchGuard's shares to trade at artificially inflated
levels through the issuance of false and misleading financial
statements. As a result of this inflation, the Company's FY 2004
revenues were overstated.
On March 15, 2005, the Company announced that it was delaying
its Q4 2004 and FY 2004 earnings call, would file a Notification
of Late Filing with the SEC with respect to its annual report on
Form 10-K and that it was restating its financial results for FY
2004. On this news, the stock fell below $3 per share.
According to the complaint, the true facts, which were known by
the defendants during the Class Period but concealed from the
investing public, were as follows:
(1) the Company's Q1-Q3 2004 reported financial results
were materially false and misleading due to inaccurate
income statement classification of early pay incentive
discounts taken by customers, under-accrual of customer
rebate obligations and timing of revenue recognition
associated with specific products and services
(resulting from an overstatement of product revenue and
an understatement of deferred revenue);
(2) the Company's February 12, 2004 projections were
materially false and misleading;
(3) the functionality and value of the Company's "Firebox
X" product was grossly overstated and this product did
not materially or accurately improve the Company's
gross margins, streamline the Company's management or
otherwise reduce its reliance on custom components; and
(4) contrary to defendants' statements, the Firebox X was
not tracking as defendants claimed.
For more details, contact the Law Offices of 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.
*********
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 Senorin, Aurora Fatima Antonio and Lyndsey
Resnick, Editors.
Copyright 2005. 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 * * *