/raid1/www/Hosts/bankrupt/CAR_Public/050915.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, September 15, 2005, Vol. 7, No. 183
Headlines
180SOLUTIONS: Attorneys Lodge Suit in IL Over Spyware Programs
AIRGATE PCS: GA Court Yet To Rule on Motion To Dismiss Lawsuit
AMAZON.COM INC.: Suit Settlement Hearing Set October 20, 2005
BRINKMANN CORPORATION: Recalls 130T Gas Grills For Fire Hazard
CABOT CORPORATION: PA Court Denies Certification Denial Appeal
CANON INC.: Consumers File NY Suit V. Defective Digital Cameras
CAPRESSO INC.: Recalls 15T Water Kettles Due to Injury Hazard
CHEMED CORPORATION: Reaches Settlement For IL Consumer Lawsuit
COX COMMUNICATIONS: NY Court Orders Amended Securities Lawsuit
COX COMMUNICATIONS: Ordered To Pay $2.525M in Attorneys' Fees
DOW CHEMICAL: Judge to Weigh Class Certification for Dioxin Case
DUANE READE: Employees Launch Overtime Wage Lawsuit in S.D. NY
DUANE READE: Court Upholds NY Attorneys' Fees Award in Lawsuit
FRIEDMAN BILLINGS: Shareholders Commence Fraud Suits in S.D. NY
HOMESTORE.COM INC.: Suit Settlement Hearing Set January 9, 2006
KONGZHONG CORPORATION: Reaches Settlement in NY Securities Suit
LEVITT CORPORATION: Faces FL Homeowners' Fraud, Negligence Suit
MANAGED CARE: Lawsuit Settlement Hearing Set December 19, 2005
MOLINA HEALTHCARE: Discovery Proceeds in NM Health Care Lawsuit
MOLINA HEALTHCARE: CA Securities Fraud Suits To Be Consolidated
MORGAN STANLEY: Hearing-impaired Client to File ADA Suit in CT
NATIONAL FINANCIAL: Named as Defendant in NJ Brokerage Fees Suit
NEW CENTURY: IL Court Upholds Consumer Fraud Suit Dismissal
NEW CENTURY: IL Court Approves TCPA Violations Suit Settlement
NEW CENTURY: CA Court Junks Appeal of Consumer Lawsuit Dismissal
NEW CENTURY: LA Court Rejects Collective Action's Certification
NEW CENTURY: NY Court Upholds Mortgage Fees Fraud Suit Dismissal
NEW CENTURY: NJ Court Dismisses Suit For RESPA, TILA Violations
NEW CENTURY: MO State Court Dismisses RESPA Violations Lawsuit
NEW CENTURY: IL Court Stays Lawsuit For Consumer Act Violations
NEW CENTURY: Faces IL Illinois Interest Act Violations Lawsuit
NEW CENTURY: CA Court Dismisses Overtime Law Violations Lawsuit
NEW CENTURY: Faces Lawsuit For FCRA Violations in N.D. Indiana
NEW CENTURY: Faces Suit For FCRA Violations in C.D. California
NEW YORK: Lawsuit Launched Over Seneca Lake Sprayground Illness
PRESTIGE BRANDS: FL, MA Consumers File Suit V. Dextromethorpan
PRESTIGE BRANDS: Shareholders Launch Securities Fraud Suit in NY
SONY COMPUTER: Recalls 843T PS2 AC Adaptors Due to Fire Hazard
VITAS: CA Employees Commence Suit For Overtime Wage Violations
WAL-MART STORES: Group Lodges CA Suit Over Labor Abuses Overseas
New Securities Fraud Cases
AMERICAN ITALIAN: Stull Stull Lodges Securities Fraud Suit in MO
ARBINET-THEXCHANGE: Brain M. Felgoise Lodges Fraud Suit in NJ
DHB INDUSTRIES: Abbey Gardy Lodges Securities Fraud Suit in NY
DHB INDUSTRIES: Brain M. Felgoise Lodges Securities Suit in NY
DHB INDUSTRIES: Schiffrin & Barroway Files Securities Suit in NY
DHB INDUSTRIES: Stull Stull Lodges Securities Fraud Suit in NY
HUTCHINSON TECHNOLOGY: Brain M. Felgoise Lodges Fraud Suit in MN
HUTCHINSON INC.: Lockridge Grindal Lodges Securities Suit in MN
MANNATECH INC.: Brain M. Felgoise Lodges Securities Suit in NM
MERCURY INTERACTIVE: Goldman Scarlato Lodges Fraud Suit in CA
*********
180SOLUTIONS: Attorneys Lodge Suit in IL Over Spyware Programs
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Attorneys Shawn M. Collins and David J. Fish of The Collins Law
Firm initiated a class action complaint against adware company
180Solutions in an Illinois district court, The ZDNet reports.
Filed on behalf of residents of the United States and the State
of Illinois, the complaint charges that 180Solutions downloaded
spyware on computers illegally causing a number of damages. The
company's alleged illegal practices include deceptively
distributing spyware files and preventing users from removing
them, engaging in deceptive misconduct to download its spyware
without users' knowledge or consent and lying to consumers about
its spyware. Counts include computer fraud and abuse, violating
Electronic Communications Privacy Act/Wiretap Act (United
States), Trespass to Personal Property/Chattels, Consumer Fraud
Act, Negligence, Computer Tampering and Invasion of Privacy,
(Illinois). Numerous examples are given for each.
On page 11 of the complaint it is stated, "Finally, the public
health and safety is also threatened by 180solutions' spyware
because it was distributed at an Internet site (and thus
financially supported an Internet site) showing child
pornography."
At the bottom of page 14, it is also stated, "180Solutions
intended to profit, and did actually profit from its wrongful
conduct by being able to obtain more adverting money by virtue
of being downloaded onto more computers" and 180solutions knew
that its conduct was deceptive and misleading [.]" and so on. A
jury trial is demanded.
For more details, on the complaint, visit
http://www.spywarewarrior.com/classactioncomplaint-180.pdf. The
suit is styled, Logan Simios, et al. v. 180Solutions, Inc. and
John Does 1-100, Case No. 05C 5235, which was filed in the
United States District Court for the Northern District of
Illinois, Eastern Division. Shawn M. Collins and David J. Fish
of The Collins Law Firm, P.C., 1770 N. Park St., Suite 200
Naperville, IL 60563, Phone: (630) 527-1595, Fax:
(630) 527-1193, E-mail: smc@collinslaw.com or
dfish@collinslaw.com, Web site: http://www.collinslaw.com/,are
representing the Plaintiff.
AIRGATE PCS: GA Court Yet To Rule on Motion To Dismiss Lawsuit
--------------------------------------------------------------
The United States District Court for the Northern District of
Georgia has yet to rule on Airgate PCS, Inc.'s motion to dismiss
the consolidated securities class action filed against the
Company and:
(1) Thomas M. Dougherty,
(2) Barbara L. Blackford,
(3) Alan B. Catherall,
(4) Credit Suisse First Boston,
(5) Lehman Brothers,
(6) UBS Warburg LLC,
(7) William Blair & Company,
(8) Thomas Wiesel Partners LLC and
(9) TD Securities
In May 2002, putative class action complaints were filed,
seeking class certification and alleging that the prospectus
used in connection with the secondary offering of Company stock
by certain former stockholders of iPCS, a former subsidiary of
the Company, on December 18, 2001 contained materially false and
misleading statements and omitted material information necessary
to make the statements in the prospectus not false and
misleading. The alleged omissions included:
(i) failure to disclose that in order to complete an
effective integration of iPCS, drastic changes would
have to be made to the Company's distribution channels,
(ii) failure to disclose that the sales force in the
acquired iPCS markets would require extensive
restructuring and
(iii) failure to disclose that the "churn" or "turnover" rate
for subscribers would increase as a result of an
increase in the amount of sub-prime credit quality
subscribers the Company added from its merger with
iPCS
On July 15, 2002, certain plaintiffs and their counsel filed a
motion seeking appointment as lead plaintiffs and lead counsel.
Subsequently, the court denied this motion without prejudice and
two of the plaintiffs and their counsel filed a renewed motion
seeking appointment as lead plaintiffs and lead counsel. On
September 12, 2003, the court again denied that motion without
prejudice and on December 2, 2003, certain plaintiffs and their
counsel filed a modified renewed motion requesting appointment
as lead plaintiffs and lead counsel.
On August 17, 2004 the court granted the plaintiff's motion.
Pursuant to a consent scheduling order agreed to by the parties,
lead plaintiffs filed a consolidated amended class action
complaint on October 15, 2004. As did the original complaints
filed in these actions, the Consolidated Complaint alleges that
the Company's registration statement and prospectus relating to
the December 2001 offering misrepresented and/or omitted adverse
facts regarding the anticipated effects of the Company's
acquisition of iPCS.
The Consolidated Complaint also asserts that the registration
statement/prospectus was false and misleading in certain other
respects not previously alleged. The legal claims asserted in
the Consolidated Complaint remain the same as those in the
original complaints, i.e. the registration statement/prospectus
violated Sections 11, 12(a)(2) and 15 of the Securities Act of
1933. In addition, the class that lead plaintiffs seek to
represent remains the same, and the named defendants remain the
same.
Defendants' responses to the Consolidated Complaint were due on
or before December 17, 2004. In the event that any defendant
moves to dismiss, lead plaintiffs were to serve their opposition
by January 21, 2005, and defendants' reply briefs are due on or
before February 22, 2005. On December 30, 2004, defendants
filed motions to dismiss the consolidated complaint. The lead
plaintiffs have not yet responded to the motions to dismiss,
which have not yet been ruled upon by the court and remain
pending.
The suit is styled "In Re: Airgate PCS, Inc. Securities
Litigation, case no. 1:02-cv-01291-JOF," filed in the United
States District Court for the Northern District of Georgia,
under Judge J. Owen Forrester.
Representing the defendants are:
(a) David Lewis Balser, McKenna Long & Aldridge, 303
Peachtree Street, N.E. One Peachtree Center, Suite
5300, Atlanta, GA 30308-3201, Phone: 404-527-4000, E-
mail: dbalser@mckennalong.com;
(b) Howard K. Coates, Jr., Milberg Weiss Bershad & Schulman
5355 Town Center Road, Suite 900 Boca Raton, FL 33486,
Mail: 561-361-5000
(c) David W.T. Daniels, David DeBold, John C. McMillan,
Eric E. Sneider, Gibson Dunn & Crutcher, 1050
Connecticut Avenue, N.W. Washington, DC 20036-5306,
Phone: 202-955-8500
(d) James David Dantzler, Jr., J. Timothy Mast, Troutman
Sanders LLP, Bank of America Plaza, Suite 5200, 600
Peachtree Street, NE Atlanta, GA 30303, Phone: 404-885-
3314, Fax: 404-962-6799, E-mail:
david.dantzler@troutmansanders.com or
tim.mast@troutmansanders.com
The plaintiff firms in this litigation are:
* 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
* Milberg Weiss Bershad Hynes & Lerach, LLP (New York,
NY), One Pennsylvania Plaza, New York, NY, 10119-1065,
Phone: 212.594.5300,
* Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
* 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
* 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
* 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
AMAZON.COM INC.: Suit Settlement Hearing Set October 20, 2005
-------------------------------------------------------------
The United States District Court for the Western District of
Washington will hold a fairness hearing for the proposes
settlement in the matter: Amazon PEACS Securities Litigation,
Master File No. C-01-0640-L, on behalf of all persons who
purchased Amazon.com, Inc. 6.875% Premium Adjustable Convertible
Securities Due 2010 ("PEACS") during the period from February 7,
2000 through and including October 24, 2000.
The hearing will held on October 20, 2005, at 9:30 a.m., before
the Honorable Robert S. Lasnik, at the Western District of
Washington (at Seattle), U.S. Courthouse, 700 Stewart St.,
Seattle, WA.
For more details, contact Mark A. Strauss, Esq. or Danielle
Feman, Paralegal of KIRBY McINERNEY & SQUIRE, LLP, 830 Third
Ave., 10th Floor New York, NY 10022, Phone: (212) 317-2300 or
(888) 529-4787 E-Mail: dfeman@kmslaw.com OR Amazon PEACS
Securities Litigation, c/o The Garden City group, Inc., Claims
Administrator, P.O. Box 9000 #6293, Merrick, NY 11566-9000, Web
site: http://www.gardencitygroup.com/cases/index.html.
BRINKMANN CORPORATION: Recalls 130T Gas Grills For Fire Hazard
--------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), The Brinkmann Corporation, of Dallas, Texas and
Zhonghshan GDA Gas Valve Co. Ltd., of China is voluntarily
recalling about 130,000 units of Brinkmann-brand and Charmglow-
brand Gas Grills manufactured by Brinkmann
The regulators on these gas grills, the component that controls
the amount of gas released to the burner, could leak gas when
attached to certain liquid propane tanks. This poses a risk of
fire and burn injuries. The Brinkmann Corporation has received
two reports of a small flame reportedly due to gas leaking at or
near the propane cylinder. No injuries or property damage have
been reported.
The recall involves Brinkmann-brand and Charmglow-brand gas
grills. The regulator is attached to the side of the grills.
Only grills that have regulators with the name "GDA" are
affected by this recall. The grills have three to six burners
and the name "Brinkmann" or "Charmglow" on the lid.
Manufactured in China, the grills were sold at all home centers,
sporting goods and hardware stores nationwide from January 2005
through September 2005 for between $150 and $900.
Consumers with grills that have the "GDA" regulator should
contact Brinkmann to receive a free repair kit or replacement
hose regulator assembly. Consumer Contact: Call Brinkmann toll-
free at (800) 675-5301 between 8:30 a.m. and 5 p.m. CT Monday
through Friday. Consumers also can log on to the company's Web
site: http://www.brinkmann.netto request a repair kit.
CABOT CORPORATION: PA Court Denies Certification Denial Appeal
--------------------------------------------------------------
The Supreme Court of Pennsylvania denied plaintiffs' appeal of a
lower court ruling refusing class certification to a medical
monitoring lawsuit filed against Cabot Corporation.
In 2000, individuals who reside within a 6-mile zone surrounding
the Reading, Pennsylvania facility filed a purported class
action in Pennsylvania state court seeking the creation of a
trust fund to pay for the medical monitoring of the surrounding
resident population. The court later denied class certification
for the suit, which the plaintiffs appealed. In April 2005, the
Supreme Court of Pennsylvania denied the plaintiff's appeal.
CANON INC.: Consumers File NY Suit V. Defective Digital Cameras
---------------------------------------------------------------
A class action suit filed in New York is accusing Canon Inc. of
selling digital cameras with a serious defect, the so-called
"e18" error that occurs when the lens sticks and will not move
in or out, which in essence renders the camera inoperable, The
ConsumerAffairs.com reports.
According to Richard Doherty of Horwitz, Horwitz & Associates, a
Chicago law firm, "We have reviewed numerous complaints from
consumers who gotten the brush-off from Canon." He also told
ConsumerAffairs.com, "Canon has refused to stand behind the
cameras, and offers consumers who paid approximately $400 for
what they thought was a high-quality digital camera the option
of a repair costing at least $150 or the opportunity to purchase
a refurbished, used camera for $175."
The class action suit was filed in the United States District
Court for the Southern District of New York and was assigned to
Judge Miriam Goldman Cedarbaum.
CAPRESSO INC.: Recalls 15T Water Kettles Due to Injury Hazard
-------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Capresso Inc., of Closter, New Jersey is voluntarily
recalling about 15,000 units of Capresso Water Kettles.
The handle can detach from the glass carafe, spilling hot water
and causing severe burn injuries. Capresso has received five
reports of the handle detaching from the carafe, including one
incident that resulted in a minor burn from contact with boiling
water.
The recalled model "H20 Classic," Cordless Water Kettle has two
parts - a black heating base and a glass kettle with a polished
chrome or a silver handle. Printed in script on the base of the
kettle is "Capresso" and engraved on the bottom of the kettle is
"CAPRESSO INC., Kettle Models 257.01, 258.03, 258.04 for use
with Kettle Base Model 256/258."
Manufactured in China, the kettles were sold at specialty
kitchen stores nationwide, mail order gourmet catalogs,
Capresso.com and other Web site retailers such as Amazon.com
between August 2004 and May 2005 for about $70. Remedy:
Consumers should stop using the water kettle immediately and
contact Capresso for a free replacement kettle. Consumer
Contact: Call Capresso at (800) 767-3554 between 8 a.m. and 9
p.m. ET Monday through Friday.
CHEMED CORPORATION: Reaches Settlement For IL Consumer Lawsuit
--------------------------------------------------------------
Chemed Corporation reached a settlement for the class action
filed against it in the Third Judicial Circuit Court of Madison
County, Illinois, alleging certain Roto-Rooter plumbing was
performed by unlicensed employees.
Customer Robert Harris filed the suit on behalf of a class of
customers in 32 states who allegedly paid for plumbing work
performed by unlicensed employees. Plaintiff also moved for
partial summary judgment on grounds the licensed apprentice
plumber who installed his faucet did not work under the direct
personal supervision of a licensed master plumber.
On June 19, 2002, the trial judge certified an Illinois-only
plaintiffs class and granted summary judgment for the named
party plaintiff on the issue of liability, finding violation of
the Illinois Plumbing License Act and the Illinois Consumer
Fraud Act, through Roto-Rooter's representation of the licensed
apprentice as a plumber. The court has not yet ruled on
certification of a class in the remaining 31 states.
In December 2004, the Company reached a tentative resolution of
this matter with the plaintiff. This proposed settlement has
not yet been finalized by the parties nor approved by the court.
Nonetheless, the Company, in anticipation of such approval,
accrued $3.1 million as the anticipated cost of settling this
litigation.
COX COMMUNICATIONS: NY Court Orders Amended Securities Lawsuit
--------------------------------------------------------------
The United States District Court for the Southern District of
New York ordered plaintiffs to file an amended class action
against Cox Communications, Inc., AT&T Corporation and certain
former officers and directors of Excite@Home.
On April 26, 2002, Frieda and Michael Eksler filed the amended
complaint. This case has been consolidated with a related case
captioned "Semen Leykin v. AT&T Corp., et al., and another
related case, and an amended complaint in the consolidated case,
naming the Company as a defendant, was filed and served on
November 7, 2002.
On March 10, 2005, the Court issued an order certifying a class
of all persons and entities who purchased the publicly traded
common stock of Excite@Home during the period March 28, 2000
through September 28, 2001, and directing that notice of the
certification be given to the class. The class excludes the
defendants in the action and certain of their related persons.
The complaint asserts a claim against the Company as an alleged
"controlling person" of Excite@Home under Section 20(a) of the
Securities Exchange Act for violations of Section 10(b) of the
Securities Exchange Act and Rule 10b-5 thereunder. The suit
seeks from the Company unspecified monetary damages, statutory
compensation and other relief.
On May 31, 2005, the plaintiffs requested permission from the
Court to move to amend their complaint to expand the class
period to include the period from November 9, 1999 to March 28,
2000, the beginning of the current class period. On July 8,
2005, the court orally issued a stay and ordered the plaintiffs
to file a proposed amended complaint, which amendment the
Company shall have the opportunity to oppose.
On July 21, 2005, Ronald Ventura filed a lawsuit against the
Company and David Woodrow, among others, in the United States
District Court for the Southern District of New York. The
Company has not been served with this lawsuit. The complaint in
the Ventura action asserts claims substantially similar to the
operative allegations in the Leykin action described above.
Accordingly, the Ventura complaint asserts a claim against the
Company as an alleged "controlling person&" of Excite@Home under
Section 20(a) of the Securities Exchange Act for purported
violations by At Home of Section 10(b) of the Securities
Exchange Act and Rule 10b-5 thereunder. In addition, the Ventura
complaint asserts a claim for unjust enrichment against Cox,
which asserts that Cox should be required to disgorge an amount
equal to the value of the 75 million shares of AT&T stock that
Cox received from AT&T in 2001. No other claims are asserted
against Cox. The Complaint seeks from Cox unspecified monetary
and punitive damages, statutory compensation, disgorgement, and
other relief.
COX COMMUNICATIONS: Ordered To Pay $2.525M in Attorneys' Fees
-------------------------------------------------------------
The Delaware and Georgia State Courts ordered Cox
Communications, Inc. to pay plaintiffs a total of $2.525 million
in attorneys' fees in the settlement of the class actions filed
against the Company in the two venues.
Eighteen putative class actions were initially filed agianst the
Company in the Delaware Court of Chancery, and later
consolidated as "In re Cox Communications, Inc. Shareholders'
Litigation, Consolidated C.A. No. 613-N." The complaint also
names as defendants:
(1) Cox Enterprises, Inc. (CEI),
(2) Cox Holdings,
(3) Barbara Cox Anthony,
(4) Anne Cox Chambers, and
(5) the members of the Cox Board of Directors
Eighteen putative class action lawsuits were filed, purportedly
on behalf of the public stockholders of the Company, challenging
CEI's August 2, 2004 proposal to acquire all of the issued and
outstanding shares of Cox Class A common stock not beneficially
owned by CEI, for $32.00 in cash per share. Fifteen of the
lawsuits were filed in the Court of Chancery of the State of
Delaware. Following a hearing held on August 24, 2004, the
Delaware court consolidated the actions.
The Delaware complaint alleges, among other things, that the
price proposed to be paid in the proposed transaction was
unfairly low, that the initiation and timing of the proposed
transaction were in breach of the defendants' purported duties
of loyalty and constituted unfair dealing, that the structure of
the proposed transaction was inequitably coercive, that
defendants caused materially misleading and incomplete
information to be disseminated to the public holders of the Cox
shares, and that the Board defendants would breach their duty of
care and good faith by approving the proposed transaction and by
purportedly attempting to disenfranchise the holders of the Cox
shares by circumventing certain alleged contractual voting
rights. The Delaware complaint seeks an injunction against the
proposed transaction, or, if it is consummated, rescission of
the transaction and imposition of a constructive trust, as well
as money damages, an accounting, attorneys' fees, expenses and
other relief.
The remaining three putative class action lawsuits were filed in
the Superior Court of Fulton County, Georgia, styled "Brody v.
Cox Communications, Inc., et al., 2004CV89198," "Golombuski v.
Cox Communications, Inc., et al., 2004CV89216," and "Durgin v.
Cox Communications, Inc., et al., 2004CV89301." The Georgia
actions were purportedly brought on behalf of the public holders
of shares of Cox Class A common stock against the Company, CEI
and the Cox Board, although four counts of the Golombuski
complaint were brought derivatively on behalf of the Company
against the Cox Board and CEI. With the exception of the Durgin
action, which did not assert claims against CEI, the Georgia
actions each allege that CEI and the Cox Board breached their
fiduciary duties in connection with the proposed transaction,
which plaintiffs allege proposed a purchase price which was
below the fair value of the Cox shares. On August 18, 2004,
plaintiffs in the Georgia actions moved for entry of a case
management order to consolidate the Georgia Actions under the
caption "In re Cox Communications, Inc. Shareholder Litigation,
C.A. No. 2004-CV-89198."
On October 19, 2004, the Company and CEI publicly announced that
they had entered into a Merger Agreement pursuant to which the
shares of Cox Class A common stock not beneficially owned by CEI
would be proposed to be acquired for $34.75 per share by means
of a tender offer and follow-on merger. On October 18, 2004,
prior to the announcement of the Merger Agreement, the parties
to the Delaware action agreed upon and executed a memorandum of
understanding.
Pursuant to the Delaware memorandum of understanding, the
parties to the Delaware action agreed, subject to the conditions
set forth therein, to enter into a stipulation of settlement, to
cooperate in public disclosures related to the Merger Agreement,
and to use their best efforts to gain approval of the proposed
settlement terms by the Delaware court. Also on October 18,
2004, the parties to the Georgia actions entered into a
memorandum of understanding which set forth the agreement by the
parties for the dismissal of the Georgia actions.
Pursuant to the Delaware memorandum of understanding and the
Georgia memorandum of understanding, defendants provided
plaintiffs' counsel in the Delaware action and the Georgia
actions with confirmatory discovery relating to the Merger
Agreement, including additional document production and
depositions, and that the parties agreed to suspend all other
proceedings in the actions except any settlement related
proceedings in Delaware and Georgia.
On November 18, 2004, the court entered a scheduling order in
the Delaware action. The scheduling order preliminarily
certified the Delaware action as a class action on behalf of a
class consisting of all record and beneficial holders of Cox
shares (other than CEI and its subsidiaries), from and including
August 2, 2004 through and including the date of the
consummation of the merger, and certain persons related to the
class members. The defendants in the Delaware action are
excluded from the class.
On January 13, 2005, an individual shareholder and several
mutual funds who purportedly were members of the plaintiff class
filed a joint objection to the requested attorneys' fees sought
by plaintiffs' counsel, but did not object to the proposed
settlement itself. On March 16, 2005, the Delaware Court of
Chancery held a hearing at which the court considered the merits
of the proposed settlement of the Delaware action. On March 18,
2005, the Delaware court entered a final order approving the
proposed settlement, certifying the requested class, and
dismissing the claims asserted against the defendants with
prejudice. The time to appeal this order has expired, and no
appeal was taken. The court separately considered the
plaintiffs' pending request for attorneys' fees on May 9, 2005.
Pursuant to the Georgia memorandum of understanding, the parties
to the Georgia actions have agreed jointly to seek the dismissal
with prejudice of the Georgia actions within two business days
of the date that the Delaware court's orders approving the
settlement and addressing the Delaware plaintiffs' request for
attorneys' fees become final and are no longer subject to
further appeal or review. In addition, in connection with the
joint motion, the plaintiffs in the Georgia actions will seek
the Georgia court's authorization for the Company to satisfy an
award of attorneys' fees.
On June 6, 2005, the Delaware court issued an opinion ordering
the Company to pay $1.275 million of the $4.95 million in fees
and expenses that the Delaware plaintiffs' attorneys had sought
and the Company previously had agreed not to oppose, pursuant to
the terms of the stipulation of settlement. Plaintiffs and the
shareholders who objected to the award of fees filed cross-
appeals to the Delaware court's decision on attorneys' fees.
On June 27, 2005, the Georgia court granted a joint motion to
dismiss the Georgia actions with prejudice filed by the Georgia
plaintiffs and defendants and also ordered the Company to pay
plaintiffs' counsel $1.25 million in fees and expenses, which
amount Cox previously had agreed not to oppose. The time for
appeal of the Georgia court's decisions has expired without
appeal.
DOW CHEMICAL: Judge to Weigh Class Certification for Dioxin Case
----------------------------------------------------------------
The Dow Chemical Co. and those wanting to sue the company for
the value of their homes are soon expected to appear in Saginaw
Circuit Court in Michigan, The Midland Daily News reports.
After more than a half-dozen delays, individuals familiar with
the matter told Midland Daily News, Judge Leopold Borrello is to
begin hearing arguments on potential class certification for the
dioxin-related suit.
A group of about 160 residents along the Tittabawassee River
flood plain are seeking to bring as many as 2,000 other property
owners under the class action umbrella. The group, which
represented by attorney Teresa Woody, are suing for the value of
their homes, which they believe have been made worthless because
of dioxins that traveled downstream from Dow's Midland plant,
settled in river sediment and contaminate their yards each time
the river rises.
Nuisance, public nuisance and negligence claims were also
included in the complaint, which was filed in March 2003, just
shortly after the Michigan Department of Environmental Quality
mailed fliers to flood plain residents warning them of
contamination, and telling them to take precautions to avoid
exposure. Additionally, the fliers also told the homeowners that
they might have to disclose information about the problem to
potential buyers.
Dow disagrees with plaintiffs' allegations that homes have lost
value, and also with class action efforts arguing that the case
does not qualify for class certification, based on what it views
as differences in property owners' situations -- some properties
are farther from the river than others, and each has varying
levels of dioxin contamination.
Gary and Kathy Henry, freelanders who first filed the suit,
argue that the contamination has limited the use of their
property. The Company said that different people use properties
in different ways. "These differences far outweigh any
commonality," according to Dow spokesman Scot Wheeler.
In addition, the company also claims that properties within the
flood plain have sold at or above market value since the state
issued its warnings, therefore, values have not been negatively
affected.
However, Ms. Woody and her clients contend that the matter is a
simple one: "The real issue is contamination of this property, .
This is the kind of case that needs to be certified. It's more
effective and more efficient. If you don't have class
certification, you can have hundreds, if not thousands of
trials." That's because plaintiffs who choose pot out could
proceed individually, according to her. Not only would that clog
courts, it would be expensive for everyone -- Michigan taxpayers
and litigants, including Dow, Ms. Woody told Midland Daily News.
"At the end of the day, Dow doesn't want to try thousands of
cases," she said.
DUANE READE: Employees Launch Overtime Wage Lawsuit in S.D. NY
--------------------------------------------------------------
Duane Reade, Inc. faces a class action filed in the United
States District Court for the Southern District of New York,
styled "Damassia v. Duane Reade Inc."
The complaint alleges that, from the period beginning November
1998, the Company incorrectly gave some employees the title,
"Assistant Manager," in an attempt to avoid paying these
employees overtime, in contravention of the Fair Labor Standards
Act and the New York Law. The complaint seeks an award equal to
twice an unspecified amount of unpaid wages.
DUANE READE: Court Upholds NY Attorneys' Fees Award in Lawsuit
--------------------------------------------------------------
The United States Second Circuit Court of Appeals affirmed the
United States District Court for the Southern District of New
York's awarding of attorneys' fees to plaintiffs in the class
action filed against Duane Reade Holdings, Inc..
The suit was filed in January 2000 regarding alleged violations
of the Fair Labor Standards Act as to a group of individuals who
provided delivery services on a contract basis to the Company.
In December 2002, the judge in the action issued a partial
summary judgment in favor of a subclass of the plaintiffs and
against the Company.
In December 2003, the Company settled the issue of the amount of
its liability to the plaintiffs without any admission of
wrongdoing and in an amount consistent with our previously
established reserves. By a decision dated August 4, 2004, the
district court awarded the plaintiffs certain attorneys' fees in
this matter. The Company then appealed this award.
FRIEDMAN BILLINGS: Shareholders Commence Fraud Suits in S.D. NY
---------------------------------------------------------------
Friedman Billings Ramsey Group, Inc. and certain of its current
and former senior officers and directors face a series of
putative class action securities lawsuits filed in the second
quarter of 2005, all of which are pending in the United States
District Court for the Southern District of New York.
The complaints in these actions are brought under various
sections of the Securities Exchange Act of 1934, as amended, and
allege misstatements and omissions concerning the investigation
conducted by the staff of the Division of Enforcement (SEC
staff) of the Securities and Exchange Commission (Commission)
and the staff of the Department of Market Regulation of NASD
(NASD staff), concerning insider trading and other charges
related to the Company's trading in a company account and the
offering of a private investment in public equity on behalf of
CompuDyne, Inc. in October 2001. The suits also allege
misstatements and omissions with regard to the Company's
expected earnings, including the potential adverse impact on the
Company of changes in interest rates.
The first identified complaint in the litigation is "Brian T.
Weiss, et al. v. Friedman, Billings, Ramsey Group, Inc., et al.,
case no. 05-CV-04617," filed in the United States District Court
for the Southern District of New York. The plaintiff firms in
this litigation are:
(1) Brodsky & Smith, LLC, 11 Bala Avenue, Suite 39, Bala
Cynwyd, PA, 19004, Phone: 610.668.7987., Fax:
610.660.0450, E-mail: esmith@Brodsky-Smith.com
(2) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com
(3) Dyer & Shuman, LLP, 801 E. 17th Avenue, Denver, CO,
80218-1417, Phone: 303.861.3003, Fax: 800.711.6483, E-
mail: info@dyershuman.com
(4) Glancy Binkow & Goldberg LLP (NY), 1501 Broadway, Suite
1416, New York, NY, 10036, Phone: (917) 510-000, Fax:
(646) 366-089, E-mail: info@glancylaw.com
(5) Lerach Coughlin Stoia Geller Rudman & Robbins
(Melville), 200 Broadhollow, Suite 406, Melville, NY,
11747, Phone: 631.367.7100, Fax: 631.367.1173, E-mail:
info@lerachlaw.com
(6) Milberg Weiss Bershad & Schulman LLP (New York), One
Pennsylvania Plaza, 49th Floor, New York, NY, 10119,
Phone: 212.594.5300, Fax: 212.868.1229, e-mail:
info@milbergweiss.com
(7) Murray, Frank & Sailer LLP, 275 Madison Ave 34th Flr,
New York, NY, 10016, Phone: 212.682.1818, Fax:
212.682.1892, E-mail: email@rabinlaw.com
(8) Pomerantz,Haudek, Block, Grossman & Gross, 100 Park
Avenue, 26th Floor, New York, NY, 10017-5516, Phone:
212.661.1100,
(9) Schatz & Nobel, P.C., 330 Main Street, Hartford, CT,
06106, Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com
(10) Scott & Scott LLC, P.O. Box 192, 108 Norwich Avenue,
Colchester, CT, 06415, Phone: 860.537.5537, Fax:
860.537.4432, E-mail: scottlaw@scott-scott.com
(11) Seeger Weiss LLP (New York), One William Street, New
York, NY, 10004, Phone: 212.584.0700, E-mail:
info@seegerweiss.com
(12) Strauss & Troy, The Federal Reserve Building, 150 East
Fourth Street, Cincinnati, OH, 45202-4018, Phone:
513.621.2120, Fax: 513.241.8250, E-mail:
wlwoods@strauss-troy.com
(13) 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
(14) Wolf Popper, LLP, 845 Third Avenue, New York, NY,
10022-6689, Phone: 877.370.7703, Fax: 212.486.2093, E-
mail: IRRep@wolfpopper.com
HOMESTORE.COM INC.: Suit Settlement Hearing Set January 9, 2006
---------------------------------------------------------------
The United States District Court for the Central District of
California, Western Division will hold a fairness hearing for
the proposed settlement in the matter: In re Homestore.com, Inc.
Securities Litigation, Master File No. 01-CV-11115 RSWM (CWx) on
behalf of all persons or entities who purchased or otherwise
acquired the common stock of the company during the period from
January 1, 2000 through December 21, 2001.
The hearing will be held on January 9, 2006 at 9:00 a.m., before
the Honorable Ronald S.W. Lew, United States Courthouse, 312 N.
Spring St., Los Angeles, CA 90012.
For more details, contact Bruce L. Simon of Cotchett, Pitre,
Simon & McCarthy, 840 Malcolm Road, Suite 200, Burlingame,
California 94010, Phone: (650) 697-6000, Fax: (650) 697-0577,
692-1112 or 692-3606 or visit the following Web sites:
http://www.cpsmlaw.com/offices.shtmlor Claims Administrator, In
re Homestore.com, Inc. Securities Litigation, P.O. Box 1670,
Faribault, MN 55021-1670, Phone: 1-866-216-0264, Web site:
http://www.homestoresettlement.com.
KONGZHONG CORPORATION: Reaches Settlement in NY Securities Suit
---------------------------------------------------------------
KongZhong Corporation (Nasdaq: KONG), a leading provider of
advanced second-generation (2.5G) wireless value-added services
in China, reached an agreement in principle to settle a
securities class action pending against it, certain of its
officers and other co-defendants in the United Stated District
Court for the Southern District of New York and arising out of
the Company's 2004 initial public offering.
The tentative settlement, which is subject to completion of
final documentation and preliminary and final court approval, is
reflected in a Memorandum of Understanding, dated as of
September 13, 2005, between the lead plaintiff, the Company and
the other defendants. Under the proposed settlement, the Company
will pay $3.5 million into a settlement fund for persons who
purchased or sold the Company's ADSs between July 9, 2004 and
August 17, 2004. At this time, there can be no assurance that
the parties will be able to agree on final documentation or that
the settlement will receive preliminary or final court approval.
The Company believes it has been in compliance with securities
laws and made appropriate and necessary disclosures in its
prospectus dated July 9, 2004 at the time of the initial public
offering.
The Company stated that it has agreed to the settlement solely
to avoid the expense, distraction and uncertainty associated
with continued litigation without admitting any fault, liability
or wrongdoing.
For more deatils, contact JP Gan, Chief Financial Officer of
KONG, Phone: +86-10-8857-6000, E-mail: ir@kongzhong.com OR Tip
Fleming of ChristensenIR, Phone: +1-917-412-3333, E-mail:
tfleming@ChristensenIR.com OR Xiaohu Wang, Manager of KONG,
Phone: +86-10-8857-6000, E-mail: xiaohu@kongzhong.com.
LEVITT CORPORATION: Faces FL Homeowners' Fraud, Negligence Suit
---------------------------------------------------------------
Levitt Corporation faces a class action filed in the 9th
Judicial Circuit Court in and for Orange County, Florida, styled
"Frank Albert, Dorothy Albert, et al. v. Levitt and Sons, LLC, a
Florida limited liability company, Levitt Homes, LLC, a Florida
limited liability company, Levitt Corporation, a Florida
corporation, Levitt Construction Corp. East, a Florida
corporation and Levitt and Sons, Inc., a Florida corporation."
The suit purports to be a class action on behalf of 95 named
plaintiffs residing in approximately 65 homes located in one of
the Company's communities in Central Florida. The complaint
alleges:
(1) breach of contract, breach of implied covenant of good
faith and fair dealing;
(2) failure to disclose latent defects;
(3) breach of express warranty;
(4) breach of implied warranty;
(5) violation of building code;
(6) deceptive and unfair trade practices;
(7) negligent construction; and
(8) negligent design
Plaintiffs seek certification as a class, or in the alternative
to divide into sub-classes, unspecified damages alleged to range
from $50,000 to $400,000 per house, costs and attorneys' fees.
Plaintiffs seek a trial by jury.
MANAGED CARE: Lawsuit Settlement Hearing Set December 19, 2005
--------------------------------------------------------------
The United States District Court for the Southern District of
Florida, Miami Division will hold a fairness hearing for the
proposed settlement in the matter: In re Managed Care
Litigation, MDL No. 1334, which includes Charles B. Shane, M.D.,
et al. v. Humana, Inc. et al., Master File No. 00-1334-MD-
MORENO, Charles B. Shane, M.D., et al. v. Humana, Inc. et al.,
Case No. 04-21589-CIV-MORENO and Kenneth A. Thomas, M.D., et al.
v. Blue Cross and Blue Shield Association, et al. on behalf of
all physicians who provided covered services to any individual
enrolled in or covered by certain health care plans at anytime
between August 4, 1990 and May 10, 2005, or any physician group
or other physicians organization.
The hearing will be held on December 2, 2005, at 9:00 a.m., at
the United States Courthouse, Courtroom IV, Tenth Floor, Federal
Justice Building, 99 Northeast Fourth St., Miami, FL, 33132.
For more details, contact Edith M. Kallas, Esq. of Milberg Weiss
Bershad & Schulman, LLP, One Pennsylvania Plaza, New York, NY,
10119-0165, Phone: (212) 594-5300 OR Archie C. Lamb of the law
offices of Archie C. Lamb, LLC, 2017 Second Ave. North,
Birmingham, AL, 35203, Phone: (800) 324-4425 or E-mail:
alamb@archielamb.com or WellPoint/Anthem Physicians Settlement
Administrator, P.O. Box 3560, Portland, OR 97208-3560, Phone:
1-866-809-8003, Web site: http://www.hmosettlements.com.
MOLINA HEALTHCARE: Discovery Proceeds in NM Health Care Lawsuit
---------------------------------------------------------------
Discovery is proceeding in the class action filed against Molina
Healthcare, Inc.'s Mexico health plan subsidiary, Molina
Healthcare of New Mexico, Inc., styled "Starko, Inc., et al. v.
NMHSD, et al., No. CV-97-06599," pending in the Second Judicial
District Court, State of New Mexico.
Several pharmacies and pharmacists filed the suit in August 1997
against the New Mexico Human Services Department (NMHSD). In
February 2001, the plaintiffs named health maintenance
organizations (HMOs) participating in the New Mexico Medicaid
program as defendants, including the predecessor of Molina
Healthcare of New Mexico. Plaintiff asserts that NMHSD and the
HMOs failed to pay pharmacy dispensing fees under an alleged New
Mexico statutory mandate.
MOLINA HEALTHCARE: CA Securities Fraud Suits To Be Consolidated
---------------------------------------------------------------
The securities class actions filed against Molina Healthcare,
Inc., J. Mario Molina, and John C. Molina will be consolidated
into a single consolidated suit in the United States District
Court for the Central District of California.
Beginning on July 27, 2005, a series of securities class action
complaints were filed in the United States District Court for
the Central District of California on behalf of persons who
acquired our common stock between November 3, 2004 and July 20,
2005. The suits purport to allege claims against the
defendants, for alleged violations of the Securities Exchange
Act of 1934 arising out of the Company's announcement of its
guidance for the 2005 second quarter and fiscal year.
The first identified complaint in the litigation is styled
"William G. Hunt, et al. v. Molina Healthcare, Inc., et al.,
case no. 05-CV-5460," filed in the United States District Court
for the Central District of California. The plaintiff firms in
this litigation are:
(1) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com
(2) Federman & Sherwood, 120 North Robinson, Suite 2720,
Oklahoma City, OK, 73102, Phone: 405-235-1560, E-mail:
wfederman@aol.com
(3) Finkelstein, Thompson & Loughran, 1050 30th Street, NW,
Washington, DC, 20007, Phone: 202.337.8000, Fax:
202.337.8090, E-mail: contact@ftllaw.com
(4) Goodkind Labaton Rudoff & Sucharow LLP, 100 Park
Avenue, New York, NY, 10017, Phone: 212.907.0700, Fax:
212.818.0477, E-mail: info@glrslaw.com
(5) Paskowitz & Associates, Phone: 800.705.9529, E-mail:
classattorney@aol.com
(6) Schatz & Nobel, P.C., 330 Main Street, Hartford, CT,
06106, Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com
(7) Schiffrin & Barroway LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com
MORGAN STANLEY: Hearing-impaired Client to File ADA Suit in CT
--------------------------------------------------------------
A hearing-impaired client at Morgan Stanley (MWD) is expected to
file a lawsuit that accuses the securities firm of
discriminating against him because it doesn't accept stock trade
orders using a system that allows the deaf to communicate by
telephone, MarketWatch reports.
The lawsuit, which is expected to be filed in federal court in
the District of Connecticut, will be seeking class action status
under the Americans with Disabilities Act for Donald A. Brunner
Jr., who is deaf, and other similarly situated individuals. It
seeks for Morgan Stanley to be ordered to accept stock trade
orders via a relay system for the deaf or hard of hearing as a
"public accommodation" under ADA.
Gary Phelan, Mr. Brunner's lawyer, initially told MarketWatch
that Mr. Brunner is no longer a client of Morgan Stanley, but
later clarified that he continues to have accounts at the firm.
Mr. Brunner though no longer makes trades with Morgan Stanley
because of the rule, according to Mr. Phelan.
In his complaint, Mr. Brunner claims that Morgan Stanley allowed
him to make trades from 1999 to June 2004 using a
teletypewriter, also known as Telecommunications Device for the
Deaf, and Telecommunications Relay Services, or TRS. According
to the suit, a teletypewriter, also known as a TTY, combined
with TRS allows the deaf or hard of hearing to communicate via
telephone by typing messages back and forth instead of talking
and listening.
The suit goes on to state that in June 2004, Mr. Brunner's
broker informed him that Morgan Stanley's policies required him
to place his trade orders in writing. The complaint pointed pout
that it is against firm policy to accept orders by email or TRS
because it prevents the firm from verifying the identity of the
individual placing the order.
However, the suit contends that Morgan Stanley's clients who are
not deaf or hard of hearing or who do not have speech
impairments are allowed to place trade orders by telephone.
Mr. Phelan argues in the suit, "TTYs have played a vital role in
enabling individuals who are deaf or hard of hearing to compete
in the workplace and to participate in the marketplace. Morgan
Stanley's decision to turn the clock back violates the Americans
with Disabilities Act."
NATIONAL FINANCIAL: Named as Defendant in NJ Brokerage Fees Suit
----------------------------------------------------------------
National Financial Partners Corporation faces an amended
consolidated class action filed in the United States District
Court for the District of New Jersey, alleging violations of
state and federal antitrust laws.
The Company has been named as one of more than 30 insurance
company and insurance brokerage defendants in an amended
complaint filed in the United States District Court Southern
District of New York in a putative class action lawsuit
captioned "Opticare Health Systems, Inc. v. Marsh & McLennan
Companies, Inc., et al. (Civil Action No. CV 06954 (DC))." The
amended complaint focuses on the payment of contingent
commissions by insurers to insurance brokers who sell their
insurance and alleged "bid rigging" in the setting of insurance
premium levels. The amended complaint purports to allege
violations of numerous laws including the Racketeer Influenced
and Corrupt Organizations (RICO) and federal restraint of trade
statutes, state restraint of trade, unfair and deceptive
practices statutes, breach of fiduciary duty and unjust
enrichment. The amended complaint seeks class certification,
treble damages for the alleged injury suffered by the putative
plaintiff class and other damages.
The Company is also a defendant in "copycat" or tag-along
lawsuits in the United States District Court for the Northern
District of Illinois, namely "Lewis v. Marsh & McLennan
Companies, Inc., et al., 04 C 7847" and "Preuss v. Marsh &
McLennan Companies, Inc., et al., 04 C 7853." Another copycat
suit, styled "Palm Tree Computers Systems, Inc. et ano v. Ace,
USA et al.," was filed in the Circuit Court for the Eighteenth
Judicial Circuit in and for Seminole County, Florida Civil
Division, Class Representation, under Case No. 05-CA-373-16-W.
The suit has been removed to the United States District Court
for the Middle District of Florida, Orlando Division, Case No.
6:05-CV-422-2ZKRS. A similar copy-cat class action complaint
captioned "Bensley Construction, Inc. v. Marsh & McLennan
Companies, Inc. et al., No. ESCV2005-0277 (Essex Superior Court,
Massachusetts) was served upon the Company in May 2005. This
action has been removed to the United States District Court for
the District of Massachusetts. Like the `Opticare' complaint,
these complaints contain no particularized allegations of
wrongdoing by the Company.
In February 2005, the Judicial Panel on Multidistrict Litigation
(JPMDL) transferred the actions then pending to the United
States District Court for the District of New Jersey for
coordinated or consolidated pretrial proceedings. The Judicial
Panel on Multidistrict Litigation subsequently issued a
conditional transfer order to transfer the "Palm Tree" lawsuit
to the same court for the same purposes, and the plaintiffs and
at least one defendant are opposing transfer of that lawsuit.
On August 1, 2005, in the multidistrict litigation pending in
the United States District Court for the District of New Jersey,
the plaintiffs filed a First Consolidated Amended Commercial
Class Action Complaint and a First Consolidated Employee
Benefits Class Action Complaint (The "Consolidated MDL
Complaints") that purport to allege claims against the Company
based upon RICO, federal and state antitrust laws, breach of
fiduciary duty, aiding and abetting breaches of fiduciary and
unjust enrichment. The Consolidated MDL Complaints are together
approximately 324 pages in length, and, like the predecessor
complaints, focus the allegations of fact upon defendants other
than the Company. It is anticipated that the Company will move
to dismiss the Consolidated MDL Complaints. None of the
plaintiffs in any of the actions have indicated the amounts
being sought in the particular actions.
The OptiCare suit is styled "In Re Insurance Brokerage Antitrust
Litigation, case no. 2:05-cv-01168-FSH," filed in the United
States District Court in New Jersey, under Judge Faith S.
Hochberg. Representing the plaintiffs are Joseph P. Guglielmo
and Edith M. Kallas, MILBERG WEISS BERSHAD & SCHULMAN LLP (NYC)
One Pennsylvania Plaza, New York NY 10119 Phone: 212-594-5300;
and Mark C. Rifkin, WOLF HALDENSTEIN ADLER FREEMAN & HERZ LLP,
270 Madison Avenue, New York, NY 10016 Phone: 212 545-4600 E-
mail: rifkin@whafh.com.
NEW CENTURY: IL Court Upholds Consumer Fraud Suit Dismissal
-----------------------------------------------------------
The Illinois Supreme Court upheld the dismissal a consolidated
class action filed against New Century Mortgage Corporation,
alleging violations of the Illinois Consumer Fraud Act.
In December 2001, Sandra Barney filed the class action complaint
in the Circuit Court in Cook County, Illinois, alleging the
unauthorized practice of law and violation of the Illinois
Consumer Fraud Act for performing document preparation services
for a fee by non-lawyers, and seeks to recover the fees charged
for the document preparation, compensatory and punitive damages,
attorneys' fees and costs.
The Company filed a motion to dismiss in February 2002. The
court thereafter consolidated the suit with other similar cases
filed against other lenders. In August 2002, the court ordered
the plaintiffs in all the consolidated cases to dismiss their
cases with prejudice. Ms. Barney filed her notice of appeal in
September 2002 and the appeal was then consolidated with 36
similar cases, referred to as the Jenkins case. Appellate
argument was heard on December 2, 2003. The appellate court
affirmed the dismissal of the consolidated cases on December 31,
2003. The plaintiff then timely filed a petition for leave to
appeal the appellate court's decision. The Company's response
to the petition was filed in February 2004. The Illinois
Supreme Court granted leave to appeal the consolidated cases,
and consolidated the Jenkins case with a similar appellate
action also proceeding in Illinois, referred to herein as the
King case. The plaintiffs/appellants filed their opening brief
in April 2004. The Company filed its consolidated response
brief in July 2004. The plaintiffs/appellants filed their reply
brief and oral argument was heard on September 28, 2004. On
April 21, 2005, the Illinois Supreme Court affirmed the
appellate court decision in favor of the Company.
NEW CENTURY: IL Court Approves TCPA Violations Suit Settlement
--------------------------------------------------------------
The Circuit Court for Cook County, Illinois approved the
settlement of the class action filed against New Century
Mortgage Corporation, alleging violations of the Telephone
Consumer Protection Act, 47 U.S.C. Section 227, and the Illinois
Consumer Fraud Act, or ICFA.
Paul Bernstein filed the suit in April 2002, seeking damages for
receiving unsolicited advertisements to telephone facsimile
machines. The plaintiffs filed an amended complaint on May 1,
2003 and, on September 18, 2003, the judge granted the Company's
motion to dismiss with respect to the ICFA count and permitted
the plaintiff to re-plead on an individual, not consolidated,
basis. On September 30, 2003, the plaintiff filed a motion for
class certification and second amended complaint. The court has
consolidated similar cases into three groups.
The Company sought and obtained an order permitting it to join
other defendants in this consolidated action and filed a motion
to dismiss the second amended complaint. Oral argument on the
Company's consolidated motion was heard on March 30, 2004. The
judge dismissed the ICFA count. At the class certification
hearing on August 10, 2004, the plaintiffs' motion for class
certification was withdrawn pursuant to a settlement between the
parties.
Pursuant to the settlement, the plaintiffs filed a third amended
complaint seeking a nationwide class. The parties executed the
written settlement agreement that the judge approved on April 5,
2005.
NEW CENTURY: CA Court Junks Appeal of Consumer Lawsuit Dismissal
----------------------------------------------------------------
The California Court of Appeals dismissed plaintiffs' appeal of
the dismissal of a class action filed against New Century
Mortgage Corporation, New Century TRS Holdings, Inc., U.S.
Bancorp, Loan Management Services, Inc., and certain individuals
affiliated with Loan Management Services.
In September 2002, Robert E. Overman and Martin Lemp filed the
class action complaint in the Superior Court for Alameda County,
California, alleging violations of the California Consumers
Legal Remedies Act, Unfair, Unlawful and Deceptive Business and
Advertising Practices in violation of Business & Professions
Code Sections 17200 and 17500, Fraud-Misrepresentation and
Concealment and Constructive Trust/Breach of Fiduciary Duty and
damages including restitution, compensatory and punitive
damages, and attorneys' fees and costs.
The plaintiffs filed an amended complaint in July 2003 and, in
September 2003, the judge granted New Century TRS's and the
Company's demurrer challenging their claims in part. The
Consumers Legal Remedies Act claim was dismissed and the
plaintiffs withdrew the Constructive Trust/Breach of Fiduciary
Duty claim. New Century TRS and the Company filed their answer
to the plaintiffs' amended complaint in September 2003. New
Century TRS and the Company then filed a Section 128.7 sanctions
motion seeking dismissal of the case.
On December 8, 2003, the court granted the motion for sanctions
against the plaintiffs for filing a first amended complaint with
allegations against New Century TRS and the Company that were
devoid of evidentiary support and ordered all those claims
stricken without prejudice. On January 27, 2004, the court
entered a judgment of dismissal without prejudice in favor of
New Century TRS and the Company. The plaintiffs filed a notice
of appeal on February 20, 2004 from the judgment entered in New
Century TRS and the Company's favor and the order granting New
Century TRS and the Company's motion for sanctions. The
plaintiffs also filed a motion with the appellate court to
consolidate this appeal with three additional appeals they have
sought in similar cases against other lenders. On May 28, 2004,
the court denied the motion. The plaintiffs/appellants filed
their opening brief in July 2004. The appeal has now been fully
briefed. New Century TRS and the Company filed a request for
oral argument on January 13, 2005. On June 10, 2005, the Court
of Appeals dismissed plaintiff's appeal for lack of appellate
jurisdiction.
NEW CENTURY: LA Court Rejects Collective Action's Certification
----------------------------------------------------------------
The United States District Court for the Middle District of
Louisiana refused to grant conditional certification of the
collective action filed against New Century Financial
Corporation, alleging violations of the Fair Labor Standards Act
(FLSA).
In April 2003, two former, short-term employees, Kimberly A.
England and Gregory M. Foshee, filed a complaint seeking class
action status against the Company, Worth Funding Incorporated
(now known as New Century Credit Corporation), and The Anyloan
Company. The action was removed on May 12, 2003 from the 19th
Judicial District Court, Parish of East Baton Rouge, State of
Louisiana to the U.S. District Court for the Middle District of
Louisiana in response to the Company's, Worth's and Anyloan's
Petition for Removal. The complaint alleges failure to pay
overtime wages in violation of the FLSA.
The plaintiffs filed an additional action in Louisiana state
court (19th Judicial District Court, Parish of East Baton Rouge)
on September 18, 2003, adding James Gray as a plaintiff and
seeking unpaid wages under state law, with no class claims. This
second action was removed on October 3, 2003 to the U.S.
District Court for the Middle District of Louisiana, and was
ordered consolidated with the first action.
In April 2004, the U.S. District Court unilaterally de-
consolidated the James Gray individual action. In September
2003, the plaintiffs also filed a motion to dismiss their claims
in Louisiana to enable them to join in a subsequently filed case
in Minnesota entitled "Klas vs. New Century Financial
Corporation, et al. New Century, Worth and Anyloan" opposed the
motion and the court agreed with their position and refused to
dismiss the plaintiffs' case, as it was filed first. The Klas
case has now been consolidated with this case and discovery is
proceeding.
The Company, Worth and Anyloan filed a motion to dismiss Worth
and Anyloan as defendants. The court granted the motion to
dismiss in April 2004. On June 28, 2004, the Company filed a
motion to reject conditional certification of a collective
action and oral argument was heard on February 15, 2005.
Plaintiffs have dismissed with prejudice forty individual
plaintiffs from the action. The Company's motion to reject the
class was granted on June 30, 2005. The plaintiffs had 30 days
to file individual actions against New Century TRS and the
Company, and 426 actions were filed. The parties agreed to
mediate and mediation is set for October 20, 2005.
NEW CENTURY: NY Court Upholds Mortgage Fees Fraud Suit Dismissal
----------------------------------------------------------------
The Appellate Division of the Supreme Court of the State of New
York located in Brooklyn, New York affirmed a lower court ruling
dismissing the class action filed against New Century Mortgage
Corporation, alleging breach of fiduciary duties and fraud.
Plaintiff Elaine Lum filed the suit in the State Court in
Suffolk County, New York in December 2003, alleging that certain
payments the Company makes to mortgage brokers, sometimes
referred to as yield spread premiums, interfered with the
contractual relationship between Ms. Lum and her broker. The
complaint also sought damages related thereto for fraud,
wrongful inducement/breach of fiduciary duty, violation of
deceptive acts and practices, unjust enrichment and commercial
bribing. The complaint seeks class certification for similarly
situated borrowers in the State of New York.
The Company filed a motion to dismiss on January 30, 2004. The
judge granted the motion and dismissed all claims on March 23,
2004. On April 12, 2004, the plaintiff filed a notice of
appeal, seeking review of the court's order granting the motion
to dismiss. The appeal has been fully briefed and the Company
awaits a ruling. On July 20, 2005, the Appellate Division of
the Supreme Court of the State of New York located in Brooklyn,
New York, affirmed the order granting the Company's motion to
dismiss the complaint. Plaintiff/appellant filed a motion with
the appellate division for re-argument and/or for leave to
appeal to the Court of Appeals.
NEW CENTURY: NJ Court Dismisses Suit For RESPA, TILA Violations
---------------------------------------------------------------
The United States District Court for the District of New Jersey
dismissed the federal claims in the class action filed against
New Century Mortgage Corporation and New Century TRS Holdings,
Inc, alleging violations of the Real Estate Settlement
Procedures Act, or RESPA, the Truth-in-lending Act, or TILA and
the New Jersey Consumer Fraud Act, and unjust enrichment.
Joseph and Emma Warburton filed the suit in June 2004. The suit
also alleges certain other violations against defendants
unrelated to New Century TRS and the Company, including Foxtons,
Inc., Foxtons North America, Foxtons Realtor and Foxtons
Financial, Inc., referred to collectively as Foxtons, and
Worldwide Financial Resources, Inc. The plaintiffs allege,
among other things, that Foxtons, acting as their broker,
charged fees and received a yield spread premium without
disclosing the same to them until the time of closing. The
class is defined as all persons in the state of New Jersey who
have purchased, or sought to purchase, a home listed for sale by
Foxtons and who have paid a prequalification application fee, or
who have received and accepted an offer from Foxtons for a fixed
interest rate mortgage loan that Foxtons failed to deliver as
promised and who have suffered damages as a result. The
complaint seeks to enjoin the wrongful conduct alleged, recovery
of actual and statutory damages, and attorneys' fees and costs.
On July 28, 2004, New Century TRS and the Company filed a motion
to dismiss the complaint for failure to state a claim. On June
13, 2005, the court entered an order dismissing the federal
claims (RESPA & TILA). On July 13, 2005, plaintiffs filed a
motion for leave to file their first amended complaint in state
court.
NEW CENTURY: MO State Court Dismisses RESPA Violations Lawsuit
--------------------------------------------------------------
The Circuit Court in St. Louis, Missouri granted New Century
Mortgage Corporation's motion to dismiss the class action field
against it and other lenders, alleging the unauthorized practice
of law in violation of Missouri state law and Real Estate
Settlement Procedures Act (RESPA).
In October 2004, Debbie Henderson, Florence Obani-Nwibari, Noble
Obani-Nwibari, Emmer Hardy, James D. Hardy, Subbaiah
Chalevendra, Rafael F. Herrara and Sandra G. Martinez filed a
class action complaint against the Company and:
(1) First Horizon Home Loan Corporation,
(2) Master Financial, Inc.,
(3) Mortgage Lenders Network USA, Inc.,
(4) Hillsboro Title Company, Inc. and
(5) American Mortgage Corporation
The suit alleges the unauthorized practice of law in violation
of Missouri state law and Real Estate Settlement Procedures Act
(RESPA) for performing document preparation services in the
state of Missouri for a fee by non-lawyers, and seeks to recover
the fees charged for the document preparation, compensatory and
punitive damages, attorneys' fees and costs.
On November 12, 2004 Mortgage Lenders Network, USA, Inc. filed a
notice of removal that removed the case to the U.S. District
Court, Eastern District of Missouri. The plaintiffs filed a
motion to remand and the case was remanded back to the Circuit
Court in St. Louis County, Missouri on February 4, 2005. The
Company filed a motion to dismiss on February 15, 2005. On July
11, 2005, the court granted the Company's motion to dismiss in
its entirety.
NEW CENTURY: IL Court Stays Lawsuit For Consumer Act Violations
---------------------------------------------------------------
The class action filed against New Century Mortgage Corporation,
in the Circuit Court of Cook County, Illinois, alleging
violations of the Illinois Interest Act, remains stayed.
In November 2004, Nancy Doherty, Krysti Lyn Randall, Robert
Elibasich and Alice Elibasich filed a class action complaint
against the Company, two of its employees and Nations Title
Agency of Illinois. The complaint alleges that defendants
violated Section 4.1a of the Illinois Interest Act by charging
more than 3 points on a loan with an interest rate of 8% or
higher. The complaint also alleges that defendants engaged in
unfair acts and practices, in purported violation of Section 2
of the Illinois Consumer Fraud Act (ICFA) by charging plaintiffs
and others points in excess of the number permitted by the
Illinois Interest Act and seeks restitution for such alleged
overpayments. Individual plaintiff, Doherty, also alleges
violation of Section 2 of ICFA, and asserts a claim for unjust
enrichment by failing to refund excess recording fees to
Doherty. The complaint seeks recovery of statutory,
compensatory and punitive damages, restitution and attorneys'
fees and costs.
The Company filed a motion to stay the case pending a final
decision in the precedential case styled "U.S. Bank v. Clark,"
pending in the Illinois Supreme Court. The court granted the
motion to stay on January 20, 2005. Oral argument occurred in
the Clark case on May 11, 2005 and the parties await a ruling.
NEW CENTURY: Faces IL Illinois Interest Act Violations Lawsuit
--------------------------------------------------------------
The class action filed against New Century Mortgage and loan
originator Residential Loan Centers of America, Inc. in the
Circuit Court of Cook County, Illinois, alleging violations of
the Illinois Interest Act, has been consolidated with the
Doherty case (above) pending in the same court.
In February 2005, Judy Brown filed the suit, alleging that that
the defendants violated Section 4.1(a) of the Illinois Interest
Act by charging more than 3% in charges on a loan with an
interest rate of 8% or higher and violated the same provision by
collecting payments on the loan. The proposed class is defined
as all persons who entered into loans secured by their real
property in Illinois with an interest rate of 8% or more and
"charges" in excess of 3% of the principal, and for which one or
more of the defendants knowingly contracted and/or received
and/or are currently receiving payments. The complaint seeks an
award of damages, interest, reasonable attorneys' fees, costs
and other relief.
NEW CENTURY: CA Court Dismisses Overtime Law Violations Lawsuit
---------------------------------------------------------------
The Superior Court of Orange County, California granted New
Century Mortgage Corporation's motion to strike the class action
filed against it, alleging violations of the state's labor laws.
In March 2005, Daniel J. Rubio, a former employee of the Company
filed the suit, alleging failure to pay overtime wages, failure
to provide meal and rest periods, and that the Company engaged
in unfair business practices in violation of the California
Labor Code. The complaint seeks recovery of unpaid wages,
interest, and attorneys' fees and costs.
The Company was served on March 22, 2005. The Company filed a
motion to strike and demurrer to the complaint in May 2005. On
July 8, 2005, the court overruled the demurrer and granted the
motion to strike.
NEW CENTURY: Faces Lawsuit For FCRA Violations in N.D. Indiana
--------------------------------------------------------------
New Century Mortgage Corporation and Home123 Corporation faces a
class action filed in the U.S. District Court, Northern District
of Indiana, Hammond Division, alleging violations of the Fair
Credit Reporting Act, or FCRA.
Perrie Bonner and Darrell Bruce filed the suit in April 2005,
claiming that the defendants accessed consumer credit reports
without authorization because the prescreened offers of credit
did not qualify as firm offers of credit. The proposed class
consists of all persons in Indiana, Illinois and Wisconsin who
received the prescreened offers from April 20, 2003 to May 10,
2005.
NEW CENTURY: Faces Suit For FCRA Violations in C.D. California
--------------------------------------------------------------
New Century Mortgage Corporation, New Century TRS Holdings, Inc.
and Home123 Corporation face a class action filed in the United
States District Court for the Central District of California,
alleging violations of the Fair Credit Reporting Act (FCRA).
In July 2005, Pamela Phillips filed the suit, claiming that New
Century TRS, New Century Mortgage and Home123 accessed consumer
credit reports without authorization because the prescreened
offers of credit did not qualify as firm offers of credit. The
case also alleges that certain disclosures were not made in a
clear and conspicuous manner. The complaint seeks damages of not
more than $1,000 for each alleged violation, declaratory relief,
injunctive relief, interest, attorneys' fees and costs.
NEW YORK: Lawsuit Launched Over Seneca Lake Sprayground Illness
---------------------------------------------------------------
A class action lawsuit was filed against the Office of State
Parks in connection with the illness outbreak at Seneca Lake
State Park's Sprayground, The WROC-TV News reports.
The lawsuit, whose lead plaintiff is a Brighton family, claims
that the office failed to ensure the water was safe. It seeks
damages on behalf of all those who got sick.
Attorneys from Rochester and Seattle banded together and filed a
notice with the state attorney general's office that they intend
to pursue a class action lawsuit against the state of New York
for the massive parasitic outbreak that struck Seneca Lake State
Park's Sprayground last month. Tricia Van Putte of Greece is the
only named plaintiff that appears in the lawsuit on behalf of
her two small children who attended the sprayground on August 11
and contracted cryptosporidiosis, the gastrointestinal illness
that is caused by the parasite, an earlier Class Action story
(September 5, 2005) reports.
In mid-August, the state found the parasite in the Sprayground's
two water tanks and since then the state has said its
investigation into how the parasite got there. By that time
nearly 4,000 people got sick after visiting the sprayground at
Seneca Lake State Park in Geneva, an earlier Class Action story
(September 5, 2005) reports.
State officials though are hesitant to place time frames on the
ongoing investigation, citing the need for a thorough analysis
of the problem. The park was closed August 15, but the illness
has shown up in people who visited the park as far back as June,
an earlier Class Action story (August 26, 2005) reports.
With so many affected by the outbreak, the situation recently
gained national attention, including coverage in The New York
Times and on CNN, however area tourism staffs are optimistic
that such exposure will not hurt business around the area, an
earlier Class Action story (August 26, 2005) reports.
PRESTIGE BRANDS: FL, MA Consumers File Suit V. Dextromethorpan
--------------------------------------------------------------
Prestige Brands International LLC faces two class actions filed
in relation to the Company's Little Remedies pediatric cough
products.
On May 9, 2005, the Company was served with a complaint in a
class action lawsuit filed in Essex County, Massachusetts,
styled as "Dawn Thompson v. Wyeth, Inc." The Company is one of
several corporate defendants, all of whom market over-the-
counter cough syrup products for pediatric use. The complaint
alleges that the ingredient dextromethorphan is no more
effective than a placebo. There is no allegation of physical
injury caused by the product or the ingredient.
In June 2005, the Company was served in a second class action
complaint involving dextromethorphan. The second case, styled
"Tina Yescavage v. Wyeth" was filed in Lee County Florida and
similarly involves multiple corporate defendants. The Company
believes that the use of dextromethorphan in pediatric products
is fully consistent with and supported by Food and Drug
Administration regulations.
PRESTIGE BRANDS: Shareholders Launch Securities Fraud Suit in NY
----------------------------------------------------------------
Prestige Brands Holdings, Inc. faces a class action, styled
"Charter Township of Clinton Police and Fire Retirement System
v. Prestige Brands Holdings, Inc. et al," filed in United States
District Court for the Southern District of New York, on behalf
of all persons who purchased the Company's securities pursuant
to and/or traceable to the Company's initial public offering
(the IPO) on or about February 9, 2005 through July 28, 2005.
The complaint also names as defendants Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Goldman, Sachs & Co and J.P. Morgan
Securities Inc., the lead or co-lead underwriters of the IPO.
The complaint charges the Company, certain of its officers and
directors, and other insiders with violations of the Securities
Act of 1933.
SONY COMPUTER: Recalls 843T PS2 AC Adaptors Due to Fire Hazard
--------------------------------------------------------------
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Sony Computer Entertainment America Inc., of Foster
City, California is voluntarily recalling about 843,000 units of
certain AC Adaptors sold with slim version PlayStationr 2 (PS2)
Systems.
According to the company, the recalled AC adaptors can overheat
and melt. This poses the risk of fire, burn and shock injuries
to consumers. Sony Computer Entertainment America has received
38 reports of adaptors overheating, including 19 reports of
melting. There have been four reports of minor property damage,
two reports of minor burns and one report of a minor shock.
The recall involves AC adaptors with the following date codes:
2004.08, 2004.09, 2004.10, 2004.11 and 2004.12 and serial
numbers beginning with "F3". The date code is located in a white
box on the lower right hand portion of the adaptor's label. Just
below the date code box is a serial number beginning with "F3"
followed by a series of digits. Adaptors with other date codes
and without the "F3" serial numbers are not included in this
recall. The AC adaptors were sold with slim version PlayStationr
2 consoles with model number SCPH-70011 or SCPH-70012. The
PlayStationr 2 model number is located on a label at the base of
the slim console.
Manufactured in China, the AC adaptors were sold at all
electronics, toy and computer game stores nationwide, as well as
Web retailers, from October 2004 through August 2005 for about
$150 for the complete system.
Consumers should stop using the recalled AC adaptors immediately
and contact Sony Computer Entertainment America to receive a
free replacement adaptor. Consumers should carefully unplug the
recalled adaptors from the wall outlet and allow to cool before
handling.
Consumer Contact: For additional information, call Sony Computer
Entertainment America toll-free at (888) 780-7690 between 6 a.m.
and 8 p.m. PT Monday through Saturday, and between 7 a.m. and
6:30 p.m. PT Sunday, or visit the firm's Web site:
http://www.us.playstation.com/.
VITAS: CA Employees Commence Suit For Overtime Wage Violations
--------------------------------------------------------------
VITAS faces a class action filed in the Superior Court of
California, Los Angeles County, in April of 2004 by Ann Marie
Costa, Ana Jimenez, Maria Ruteaya and Gracetta Wilson alleging
failure to pay overtime wages and to provide meal and break
periods to California nurses, home health aides and licensed
clinical social workers.
The Company contests these allegations and believes them without
merit. Due to the complex legal and other issues involved, it is
not presently possible to estimate the amount of liability, if
any, related to this case. Management cannot provide assurance
the Company will ultimately prevail in it. Regardless of
outcome, such litigation can adversely affect the Company
through defense costs, diversion of management's time, and
related publicity, the Company said in a disclosure to the
Securities and Exchange Commission.
WAL-MART STORES: Group Lodges CA Suit Over Labor Abuses Overseas
----------------------------------------------------------------
The International Labor Rights Fund initiated a class action
lawsuit against Wal-Mart Stores on behalf of apparel workers in
Bangladesh, China and other countries, which asserts that the
Arkansas-based retailer violated its contractual obligations by
not enforcing its code of conduct for overseas contractors, The
New York Times reports.
Filed in state court in Los Angeles, the lawsuit makes the novel
argument that Wal-Mart's code of conduct created contractual
obligations between it and thousands of workers employed by
contractors who were supposed to comply with the code.
In the suit, the workers from Bangladesh, China, Indonesia,
Nicaragua and Swaziland assert that the codes of conduct were
violated in dozens of ways. The workers alleged in the suit that
they were often paid less than the minimum wage and did not
receive time-and-a-half for overtime, and some are even claiming
that they were beaten by managers and were locked in their
factories.
Thus, the suit is argues, "Based on its vast economic power,
Wal-Mart, based on its code of conduct, can and does control the
working conditions of its supplier factories. It could use its
power and position to prevent its producers from profiting from
the inhumane treatment of plaintiffs."
Beth Keck, a Wal-Mart spokeswoman, told The New York Times that
the company was studying the lawsuit adding, "It's really too
early for us to go into any kind of detail about this complaint.
It involves a number of countries, suppliers and factories. We
will be looking into this and taking it very seriously."
The complaint tells the stories of 16 plaintiffs, but lists them
as John and Jane Does, citing that they need to be protected
against reprisal. It accuses Wal-Mart of breach of contract for
wage violations, forced labor and denying workers the right to
associate freely. Additionally, the complaint also accuses the
company of negligence, unjust enrichment and fraudulent and
deceptive practices in violating California's business code.
Terry Collingsworth, executive director of the International
Labor Rights Fund, a Washington-based advocacy group, asserted
that filing the lawsuit in California was appropriate because
Wal-Mart had violated that state's laws. He told The New York
Times that if the plaintiffs had filed the lawsuit in their home
countries, they would have faced arrest, physical attacks and
hostile judicial systems that favored corporations.
Mr. Collingsworth faulted Wal-Mart's monitoring system for the
events that befell the workers, contending that fewer than 10
percent of its inspections were unannounced. He added that
company managers often coach workers on what to tell the
inspectors.
Wal-Mart executives though say that they are working to improve
the monitoring and that more inspections will be unannounced.
Court documents revealed that the plaintiffs include four
unionized California supermarket workers who claim that they
suffered cuts in pay and benefits because of competition from
Wal-Mart's low prices. These workers argued that those prices
are attributable in part to violations of the chain's suppliers'
code of conduct.
New Securities Fraud Cases
AMERICAN ITALIAN: Stull Stull Lodges Securities Fraud Suit in MO
----------------------------------------------------------------
The law firm of Stull, Stull & Brody initiated a class action in
the United States District Court for the Western District of
Missouri on behalf of purchasers of American Italian Pasta
Company ("AIPC") (NYSE: PLB) common stock during the period
between October 4, 2000 and August 9, 2005 (the "Class Period").
The complaint charges AIPC and certain of its officers and
directors with violations of the Securities Exchange Act of
1934. AIPC engages in the production and marketing of dry pasta
in North America. The complaint alleges that during the Class
Period, defendants caused AIPC's shares to trade at artificially
inflated levels by issuing a series of materially false and
misleading statements regarding the Company's financial
statements, business and prospects. This caused the Company
stock to trade as high as $51.78 per share during the Class
Period and allowed defendants to sell 551,888 shares of their
APIC stock at artificially inflated prices for proceeds of $19.4
million. Then, on August 9, 2005, the Company issued a press
release announcing that it was "delaying the release of its full
financial results for the third fiscal quarter ended July 1,
2005 and is also delaying the filing of its third quarter Form
10-Q with the Securities and Exchange Commission (SEC). The
Company stated that its Audit Committee is conducting an
internal investigation of certain accounting procedures and
practices and certain other matters. The Company also outlined
impairment charges and other financial statement adjustments
that will be recorded and provided an overview of its business
results for the third quarter." On this news, AIPC's stock
collapsed to as low as $13.10 per share before closing at $13.28
per share on volume of 4.7 million shares. According to the
complaint, the true facts, which were known by each of the
defendants but concealed from the investing public during the
Class Period, were as follows:
(1) the Company lacked requisite internal controls, and, as
a result, the Company's projections and reported
results were based upon defective assumptions and/or
manipulated facts;
(2) contrary to defendants' claims of fiscal 2005
profitability, the Company was actually on track to
report losses;
(3) the Company lacked the necessary personnel to issue
accurate financial reports and projections;
(4) the Company's financial statements were presented in
violation of General Accepted Accounting Principals;
and
(5) as a result of the above, the Company's projections for
fiscal year 2005 were grossly inflated.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, 6 East 45th Street, New York, NY 10017, Phone:
1-800-337-4983, Fax: 212/490-2022, E-mail: SSBNY@aol.com, Web
site: http://www.ssbny.com.
ARBINET-THEXCHANGE: Brain M. Felgoise Lodges Fraud Suit in NJ
-------------------------------------------------------------
The Law Offices of Brian M. Felgoise, P.C., filed a securities
class action on behalf of shareholders who acquired Arbinet-
Thexchange, Inc. (NASDAQ: ARBX) securities on December 16, 2004,
the initial public offering ("IPO" or the "Offering"), inclusive
(the Class Period).
The case is pending in the United States District Court for the
District of New Jersey, against the company and certain key
officers and directors.
The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities. No class has yet been
certified in the above action.
For more details, contact Brian M. Felgoise, Esq. of The Law
Offices of Brian M. Felgoise, P.C., 261 Old York Road, Suite
423, Jenkintown, PA 19046, Phone: (215) 886-1900, E-mail:
securitiesfraud@comcast.net.
DHB INDUSTRIES: Abbey Gardy Lodges Securities Fraud Suit in NY
--------------------------------------------------------------
The law firm of Abbey Gardy, LLP commenced a Class Action
lawsuit in the United States District Court for the Eastern
District of New York (Civil Action No. 05-4330) on behalf of a
class (the "Class") of all persons who purchased or acquired
securities of DHB Industries, Inc. ("DHB" or the
"Company")(Amex: DHB) between April 21, 2004 and August 29, 2005
inclusive (the "Class Period").
The Complaint alleges that defendants violated Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5
promulgated thereunder, by issuing a series of material
misrepresentations to the market during the Class Period thereby
artificially inflating the price of DHB securities. The
Complaint names as defendants DHB, David H. Brooks, Sandra
Hatfield, Dawn Marie Schlegal, Cary Lawrence Chasin, Jerome
Krantz, Barry Berkman and Gary Nadelman. The Complaint alleges
that DHB
(1) carried out a scheme to deceive the investing public by
falsely representing that the Company's body armor
products were safe and made of high quality;
(2) recklessly failed to disclose the defects pertaining to
Zylon, a material present in high concentrations in
DHB's protective body armor; and
(3) engaged in acts, practices, and a course of business
which operated as a fraud and deceit upon the
purchasers of the Company's securities in an effort to
maintain artificially high market prices for DHB
securities.
More specifically, the Complaint alleges that during the class
period, DHB sold millions of shares despite the defendants'
knowledge of the ineffectiveness of millions of the Company's
bucket resistant body armor products.
On August 30, 2005, DHB announced that the Company had
discontinued the use of Zylon in its bullet resistant products
as of August 24, 2005 and will implement a "Voluntary
Replacement Program" for the Company's body armor. The Company
also announced that it would record a charge of up to $60
million to third quarter earnings to account for the anticipated
cost of the Zylon Replacement Program and discontinued sales of
products that contain Zylon. Following this announcement, shares
of DHB common stock fell from $6.66 on August 29, 2005 to close
at $5.10 on August 30, 2005 on unusually heavy trading volume.
For more details, contact Susan Lee or Nancy Kaboolian, Esq. of
Abbey Gardy, LLP, 212 East 39th St., New York, NY 10016, Phone:
(212) 889-3700 or (800) 889-3701, E-mail: slee@abbeygardy.com.
DHB INDUSTRIES: Brain M. Felgoise Lodges Securities Suit in NY
--------------------------------------------------------------
The Law Offices of Brian M. Felgoise, P.C., filed a securities
class action on behalf of shareholders who acquired DHB
Industries, Inc. (AMEX: DHB) securities between April 21, 2004
and August 29, 2005, inclusive (the Class Period).
The case is pending in the United States District Court for the
Eastern District of New York, against the company and certain
key officers and directors.
The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities. No class has yet been
certified in the above action.
For more details, contact Brian M. Felgoise, Esq. of The Law
Offices of Brian M. Felgoise, P.C., 261 Old York Road, Suite
423, Jenkintown, PA 19046, Phone: (215) 886-1900, E-mail:
securitiesfraud@comcast.net.
DHB INDUSTRIES: Schiffrin & Barroway Files Securities Suit in NY
----------------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP, initiated a class
action lawsuit in the United States District Court for the
Eastern District of New York on behalf of all securities
purchasers of DHB Industries, Inc. (Amex: DHB) ("DHB" or the
"Company") from April 21, 2004 through August 29, 2005,
inclusive (the "Class Period").
The complaint charges DHB, David H. Brooks, Sandra Hatfield, and
Dawn M. Schlegel with violations of the Securities Exchange Act
of 1934. More specifically, the Complaint alleges that the
Company failed to disclose and misrepresented the following
material adverse facts, which were known to defendants or
recklessly disregarded by them:
(1) that DHB's body armor products were unsafe and
defective;
(2) that despite knowledge of this, the Company continued
to falsely represent that its body armor products were
safe and of high quality;
(3) that defendants knew and/or recklessly disregarded that
continued sales of its unsafe and defective body armor
products could have a material adverse effect on DHB's
finances; and
(4) that DHB lacked adequate internal controls and because
of this, was unable to determine the true financial
impact of withdrawal of any of its products.
On August 30, 2005, DHB announced that it would take a charge of
up to $60 million in the third quarter to discontinue production
of certain bullet-proof vests because of safety concerns.
Following this announcement, shares of DHB, on August 30, 2005,
fell $1.56 per share, or 23.42 percent, to close at $5.10 per
share on unusually heavy trading volume.
For more details, contact Darren J. Check, Esq. or Richard A.
Maniskas, Esq. of Schiffrin & Barroway, LLP, 280 King of Prussia
Road, Radnor, PA 19087, Phone: 1-888-299-7706 or 1-610-667-7706,
E-mail: info@sbclasslaw.com, Web site:
http://www.sbclasslaw.com.
DHB INDUSTRIES: Stull Stull Lodges Securities Fraud Suit in NY
--------------------------------------------------------------
The law firm of Stull, Stull & Brody initiated class action in
the United States District Court for the Eastern District of New
York on behalf of purchasers of DHB Industries, Inc. ("DHB")
(AMEX: DHB) common stock during the period between April 21,
2004 and August 29, 2005 (the "Class Period").
Stull, Stull & Brody has substantial experience representing
employees who suffered losses from purchases of their employer's
stock in their 401(k) plans. If you bought DHB's stock through
your DHB retirement account and have information or would like
to learn more about these claims, please contact us.
The complaint charges DHB violated federal securities laws.
Specially, throughout the Class Period, defendants issued
numerous statements concerning the quality of the Company's
bulletproof vests. Recently, DHB announced it would stop
manufacturing and selling certain of its vests due to their
being decertified by a government agency and took a write-off.
Following this announcement, DHB stock declined in value.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, 6 East 45th Street, New York, NY 10017, Phone:
1-800-337-4983, Fax: 212/490-2022, E-mail: SSBNY@aol.com, Web
site: http://www.ssbny.com.
HUTCHINSON TECHNOLOGY: Brain M. Felgoise Lodges Fraud Suit in MN
----------------------------------------------------------------
The Law Offices of Brian M. Felgoise, P.C., filed a securities
class action on behalf of shareholders who acquired Hutchinson
Technology, Inc. (NASDAQ: HTCH) securities between October 4,
2004 and August 29, 2005, inclusive (the Class Period).
The case is pending in the United States District Court for the
District of Minnesota, against the company and certain key
officers and directors.
The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities. No class has yet been
certified in the above action.
For more details, contact Brian M. Felgoise, Esq. of The Law
Offices of Brian M. Felgoise, P.C., 261 Old York Road, Suite
423, Jenkintown, PA 19046, Phone: (215) 886-1900, E-mail:
securitiesfraud@comcast.net.
HUTCHINSON INC.: Lockridge Grindal Lodges Securities Suit in MN
---------------------------------------------------------------
The law firm of Lockridge Grindal Nauen P.L.L.P. filed a class
action lawsuit on behalf of purchasers of the securities of
Hutchinson Technology, Inc. ("Hutchinson" or the "Company")
(Nasdaq: HTCH) between October 4, 2004 and August 29, 2005,
inclusive (the "Class Period") seeking to pursue remedies under
the Securities Exchange Act of 1934 (the "Exchange Act").
The action is pending in the United States District Court for
the District of Minnesota against defendants Hutchinson
Technology, Inc., Wayne M. Fortun, John A. Ingleman and Jeffrey
W. Green. A copy of the complaint filed in this action is
available from the Court.
As set forth in the complaint, Hutchinson is a designer
manufacturer and supplier of suspension assemblies that hold
magnetic read-write heads at microscopic distances above disks
in disk drives. According to the Company, the smaller the
distance between a read-write head and the surface of a disk,
the greater the storage capacity of a disk drive.
During the Class Period, Hutchinson presented itself as a
company that consistently was beating its own earnings guidance.
Defendants' positive statements caused the price of Hutchinson
common stock to be artificially inflated during the Class
Period. However, defendants' statements were materially false
and misleading. First, defendants overstated the demand for the
Company's product. Defendants also failed to disclose that a
shift in the mix of products toward new, low-yielding products
was negatively impacting the Company's business and prospects,
and defendants failed to disclose that they had not implemented
an adequate system of internal controls. As a result,
defendants' statements lacked any basis in fact and were
materially false and misleading. Defendants took advantage of
the artificially inflated Hutchinson stock price by selling
their own shares for more than $12.1 million in proceeds.
On August 30, 2005, before the market opened, Hutchinson issued
a press release stating that earnings would be $0.05 per share,
compared to previous guidance of $0.65, and that the Company's
gross margins would fall as low as 19%, significantly lower than
the Company's previous estimate of as high as 30%. In reaction
to this lowered guidance, Hutchinson stock fell $5.35 per share
to $26.16 on August 30, 2005. This constituted a drop of 17
percent, from its closing price of $31.51 on August 29, 2005.
For more details, contact Gregg M. Fishbein, Esq. or Gregory J.
Myers of Lockridge Grindal Nauen P.L.L.P., 100 Washington Ave.,
South, Suite 2200, Minneapolis, MN 55401, Phone: (612) 339-6900,
E-mail: gmfishbein@locklaw.com or gjmyers@locklaw.com.
MANNATECH INC.: Brain M. Felgoise Lodges Securities Suit in NM
--------------------------------------------------------------
The Law Offices of Brian M. Felgoise, P.C., filed a securities
class action on behalf of shareholders who acquired Mannatech,
Inc. (NASDAQ: MTEX) securities between August 10, 2004 and May
9, 2005, inclusive (the Class Period).
The case is pending in the United States District Court for the
District of New Mexico, against the company and certain key
officers and directors.
The action charges that defendants violated the federal
securities laws by issuing a series of materially false and
misleading statements to the market throughout the Class Period
which statements had the effect of artificially inflating the
market price of the Company's securities. No class has yet been
certified in the above action.
For more details, contact Brian M. Felgoise, Esq. of The Law
Offices of Brian M. Felgoise, P.C., 261 Old York Road, Suite
423, Jenkintown, PA 19046, Phone: (215) 886-1900, E-mail:
securitiesfraud@comcast.net.
MERCURY INTERACTIVE: Goldman Scarlato Lodges Fraud Suit in CA
-------------------------------------------------------------
The law firm of Goldman Scarlato & Karon, P.C., initiated a
lawsuit in the United States District Court for the Northern
District of California, on behalf of persons who purchased or
otherwise acquired publicly traded securities of Mercury
Interactive Corporation ("Mercury" or the "Company")
(NASDAQ:MERQE) between October 22, 2003 and August 23, 2005,
inclusive, (the "Class Period"). The lawsuit was filed against
Mercury and certain officers and directors.
The complaint alleges that during the Class Period, unknown to
investors, the Company's internal controls and corporate
compliance mechanisms were inadequate. On July 28, 2005, Mercury
filed a Form 8-K with the SEC disclosing that it had formed a
Special Committee in response to an SEC inquiry relating to the
timing of the Company's issuance of certain stock options. On
August 29, 2005, the Company issued a press release and filed a
Form 8-K with the SEC announcing that the Company's previously
issued financial statements could no longer be relied upon and
that it would be restating its financial results for fiscal
years 2002, 2003, and 2004 and for the first quarter, 2005. The
Company's stock price, which traded as high as $44.74 on June 1,
2005, fell to $36.94 on August 29, 2005 following the Company's
announcements.
For more details, contact Mark S. Goldman, Esq. of the Law Firm
of Goldman Scarlato & Karon, P.C., Phone: 888-753-2796, E-mail:
info@gsk-law.com.
*********
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asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
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*********
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Class Action Reporter is a daily newsletter, co-published by
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Copyright 2005. All rights reserved. ISSN 1525-2272.
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