/raid1/www/Hosts/bankrupt/CAR_Public/061124.mbx
C L A S S A C T I O N R E P O R T E R
Friday, November 24, 2006, Vol. 8, No. 234
Headlines
AIRLINES: B.C. Litigation Alleges Price Fixing on Airfreight
ARIZONA: Groups Sue County Over Anti-Smuggling Immigration Law
AWB LTD: U.S. Farmers' $1B Racketeering Litigation Withdrawn
BOEING CO: Ex-Workers' Suit in Kans. Gets Class Certification
CALIFORNIA: Settlement Compliance of Ravenswood School Reviewed
CARDINAL HEALTH: Discovery Continues in Ohio Stock Fraud Suit
COMPUCREDIT CORP: Continues to Face N.C. Consumer Fraud Lawsuit
CONSECO INC: Reaches Settlement in Calif. Insurance Fraud Suit
CONSECO INSURANCE: Nov. 2007 Trial Set for Calif. Consumer Suit
CROSS COUNTRY: Agrees to Settle Calif. Wage Suit for Up to $10M
CROSS COUNTRY: Calif. Court Denies Class Status for Labor Suit
DIRECT GENERAL: Faces Fla. Suit Over Insurance Policy Offerings
ELECTRONIC ARTS: Calif. Court Okays $15M Labor Suit Settlement
EQUITY OFFICE: Investors File Suit in Ill. Over Blackstone Offer
FORD MOTOR: Ill. Court Refuses to Dismiss Suit Over Flaky Paints
INTERNATIONAL BUSINESS: Settles Calif. Labor Lawsuit for $65M
LA SENZA: Files Motion to Dismiss Calif. Suit Over Wet Seal Deal
LEADIS TECHNOLOGY: Court Mulls Appeal for Calif. Securities Suit
LYCOMING ENGINES: Faces Suit in Ill. Over Defective Crankshafts
MEDSTAFF INC: Class Status Sought for Calif. Overtime Wage Suit
MERCK & CO: La. Judge Junks Suit by Vioxx Users in 9 Countries
MERCK & CO: La. Judge Refuses to Certify Personal Injury Lawsuit
NOVASTAR HOME: Md. State Court Certifies Class in Jones Lawsuit
PARMALAT SPA: Credit Suisse, BNL Settle Investors Suit for $50M
REWARDS NETWORK: Appeals Court Allows Appeal of "Bistro" Ruling
RUBIO'S RESTAURANTS: May 2007 Trial Set for Calif. Labor Lawsuit
SCRIPPS HEALTH: Motion to Dismiss Overcharging Suit Rejected
SHARPER IMAGE: Faces Suit Over Back-Dated Stock Option Grants
SLM CORP: Parties File Motions in D.C. Consumer Suit Ruling
STRATEGIC ENERGY: Plaintiffs Amend Suit Over Power Supply Deal
TETRA TECH: Faces Suit Over Back-Dated Stock Option Grants
UNUMPROVIDENT CORP: Hearing to Certify Antitrust Suit Set Jan.
VIENNA BEEF: Faces Cook County Lawsuit Over Mislabeled Hotdogs
WASHINGTON: Bellevue Resident Sues Seattle Over Parking Tickets
WESTMORELAND COAL: Faces Litigation in Miss. Over CO2 Emissions
Asbestos Alert
ASBESTOS LITIGATION: Claims v. Albany Int'l. Decrease to 19,283
ASBESTOS LITIGATION: Brandon Drying Records 8,992 Injury Claims
ASBESTOS LITIGATION: Essex Still Has Product Liability Lawsuits
ASBESTOS LITIGATION: Grace Records 65,656 Suits Since April 2001
ASBESTOS LITIGATION: W.R. Grace Faces 640 Property Damage Claims
ASBESTOS LITIGATION: Grace Faces 129,191 Personal Injury Claims
ASBESTOS LITIGATION: Grace Notes $959M Coverage from 54 Insurers
ASBESTOS LITIGATION: Grace Estimates $255.7M for Cleanup in 3Q06
ASBESTOS LITIGATION: Ampco-Pittsburgh Has 12,230 Claims in 3Q06
ASBESTOS LITIGATION: General Cable Corp. Deals With 40.4T Claims
ASBESTOS LITIGATION: MetLife Inc. Receives 6,384 Claims in 3Q06
ASBESTOS LITIGATION: Foster Wheeler Has $411.7M Liability in 3Q
ASBESTOS LITIGATION: Foster Wheeler Has 150.8T U.S. Claims in 3Q
ASBESTOS LITIGATION: Foster Wheeler Has 334 U.K. Claims in 3Q06
ASBESTOS LITIGATION: Chubb Corp. Has $1.038B Loss Reserves in 3Q
ASBESTOS LITIGATION: ACE Ltd. Reserves $3.050B for Claims in 3Q
ASBESTOS LITIGATION: BNS Holding's Claims Remain at 234 in 3Q06
ASBESTOS LITIGATION: Old Republic Reserves $185M for A&E Claims
ASBESTOS LITIGATION: Cooper Ind. Records 31.4T Abex Claims in 3Q
ASBESTOS LITIGATION: EnPro Ind. Records 112.5T Open Cases in 3Q
ASBESTOS LITIGATION: CNA Financial Has $1.480B for Claims in 3Q
ASBESTOS LITIGATION: Court Mulls Guarding CNA from Future Claims
ASBESTOS LITIGATION: CNA Financial Faces Keasbey Claims Dispute
ASBESTOS LITIGATION: CNA Financial Deals With Burns & Roe Action
ASBESTOS LITIGATION: CNA Financial Units Have Suits in 4 States
ASBESTOS LITIGATION: CNA Companies Face Lawsuits in Tex. Courts
ASBESTOS LITIGATION: CNA Unit Reaches Settlement in Adams Action
ASBESTOS LITIGATION: CNA Faces Lawsuit Filed by 8 Grace Workers
ASBESTOS LITIGATION: Hercules Has 30,125 Pending Claims in 3Q06
ASBESTOS LITIGATION: Hercules Inc. Has $253.2M Liabilities in 3Q
ASBESTOS LITIGATION: Claims v. Cytec Ind. Drop to 9.1T in 3Q06
ASBESTOS LITIGATION: Court Withdraws USG Property Damage Claims
ASBESTOS LITIGATION: Hardie Trust Not to Pay Taxes, Premier Says
ASBESTOS LITIGATION: Federal-Mogul Files 4th Reorganization Plan
ASBESTOS LITIGATION: DaimlerChrysler to Pay $20M in Injury Suit
New Securities Fraud Cases
BODISEN BIOTECH: Glancy Binkow Files Securities Suit in N.Y.
BRANTLEY CAPITAL: Wechsler Harwood Files Securities Suit in N.Y.
*********
AIRLINES: B.C. Litigation Alleges Price Fixing on Airfreight
------------------------------------------------------------
British Columbia resident Karen McKay has launched a purported
class action, alleging that dozens of airlines worldwide fixed
their prices on airfreight, according to The Canadian Press.
The suit focuses on the fuel and security surcharges customers
paid dating back to January 2001. Ms. McKay, according to the
suit, paid the charges to ship dogs between Canada, the U.S. and
Australia.
Ms. McKay claims in her suit that the airlines agreed to fix,
maintain and increase their surcharge prices and attempted to
hide those practices from their customers.
Several similar lawsuits are ongoing in the U.S. and Lufthansa
has already reached an $85 million settlement over 80 lawsuits
making the same allegations in the U.S.
ARIZONA: Groups Sue County Over Anti-Smuggling Immigration Law
---------------------------------------------------------------
Maricopa County authorities face a purported class action in the
U.S. District Court for the District of Arizona, challenging the
practice of arresting and locking up undocumented immigrants
under a controversial interpretation of the state's anti-
smuggling law.
The suit alleges by charging undocumented immigrants with
conspiring to smuggle themselves into the county, defendants are
violating their constitutional rights.
Plaintiffs in the lawsuit include:
-- We Are America/Somos America Coalition of Arizona;
-- Arizona Hispanic Community Forum;
-- League of United Latin American Citizens;
-- Friendly House;
-- Rep. Kyrsten Sinema, D-15;
-- Rep. David Lujan, D-15;
-- Rep. Steve Gallardo, D-13;
-- ASU associate professors Cecilia Menjivar and LaDawn
Haglund; and
-- six illegal immigrants charged with felony conspiracy
under the Maricopa County policy.
They are claiming that the county's enforcement policy is a
scheme to control international borders.
Specifically, they are blaming Maricopa County Attorney Andrew
Thomas and Sheriff Joe Arpaio for using the policy to garner
media attention and further their political fortunes by
criticizing federal authorities' ability to control immigration.
Thus, plaintiffs are both seeking to have the practice declared
unconstitutional and an order that stops it. They claim that
regulating immigration is a federal responsibility.
The anti-smuggling statute went into effect this year. Since
March, Sheriff Arpaio said his officers have made 360 arrests
and there have been 180 convictions under the new law.
According to the complaint, the six immigrants represented in
the case were never previously charged with criminal offenses
but were arrested, detained and charged under the county's
policy.
The suit stated that charges are pending for each immigrant. It
also revealed that two were deported, two remain in jail and two
were released on bail.
The suit is "We Are America/Somos America Coalition of Arizona,
et al. v. Thomas, et al., Case No. 2:06-at-11271," filed in the
U.S. District Court for the District of Arizona.
Representing the plaintiffs is Hal Michael Clyde of Perkins Coie
Brown & Bain, P.A., PO Box 400, Phoenix, AZ 85001-0400, Phone:
602-351-8000, Fax: 602-648-7035, E-mail: MClyde@perkinscoie.com.
AWB LTD: U.S. Farmers' $1B Racketeering Litigation Withdrawn
------------------------------------------------------------
North American farmers who filed a $1 billion class action
against AWB LTD. and its U.S. subsidiary, AWB (USA) Ltd.
withdrew their case.
Sources told The Australian that the decision to withdraw was
done after the case was considered unlikely to succeed before a
conservative court in Washington, where it was filed.
The suit, was brought by a U.S. legal firm on behalf of a group
of farmers who are mostly over 75, destitute and living in
Kansas, accuses the Australian wheat exporter of engaging in a
worldwide campaign of racketeering, money laundering, fraud and
bribery to corner grain markets.
Despite the withdrawal, it may yet be filed in another
jurisdiction, with a more sympathetic judge, according to
reports.
The suit, filed in a Washington, D.C. court, is claiming $1
billion in damages from the defendants. Plaintiffs allege that
the defendants' actions in Iraq and several other countries
breached U.S. laws and hurt thousands of American and Canadian
farmers (Class Action Reporter, July 12, 2006).
Farmers, including lead plaintiff Veryl Switzer, are basing
their claims on the U.S. Racketeer Influence and Corrupt
Organizations Act, which was designed to target the mafia and
other criminal groups. They are also basing their claims on
alleged breaches by defendants of the U.S. Foreign Corrupt
Practices Act.
Currently, the class action only names six farmers, however it
does allow more than 20,000 to join in later. Reports indicate
that American lobby group, U.S. Wheat Associates, would consider
joining the action if it was approached. The Canadian Wheat
Farmers Association is reportedly considering joining the class
action as well.
Last year, a U.N. investigative committee found that AWB paid
$290 million in kickbacks to Saddam Hussein's regime to secure
wheat contracts in Iraq.
The Cole Inquiry in Sydney uncovered evidence about AWB's
corruption of the U.N. oil-for-food program between 1999 and
2003, as well as subsequent cover-up attempts.
The Cole Inquiry was an inquiry set up by Australia officials
under the Royal Commissions Act 1902 in November 2005 to
investigate the role of certain Australian companies in the
systematic corruption of the Oil for Food program by Saddam
Hussein. It was limited to investigating the role of three
Australian companies in paying kickbacks to Saddam Hussein,
according to http://en.wikipedia.org/wiki/Cole_inquiry.
Its Royal Commissioner was the Honorable Terence Cole Q.C., a
former Judge of Appeal of the New South Wales Supreme Court.
John Agius S.C., Counsel Assisting, and three other barristers,
Gregory Nell, Michael Wigney and Miles Condon, supported Mr.
Terence in the inquiry.
However, AWB's "fraudulent abuse" of the U.N. food program and
"bribery" of Iraqi officials form only part of the "allegations
of fact" in the class action. In the complaint, obtained by
Australian news agency, The Age, AWB is also being accused of:
-- bribing Yemeni Government officials to secure a wheat
contract in 1999;
-- bribing Pakistani officials for a contract to export
wheat to Pakistan in 2000;
-- sabotaging the Indonesian wheat market in 2002 to shut
out U.S. rivals by fraudulently manipulating the U.S.
Agriculture Department export-credit program; and
-- committing perjury and obstructing justice in an effort
to cover up the wheat board's corrupt Iraqi dealings.
The complaint also states, "certain AWB officials intentionally
and knowingly conspired to utilize illegal tactics such as wire
fraud, bank fraud, bribery, money laundering and tortious
interference with business opportunity in order to gain an
unfair competitive advantage in certain wheat markets including,
but not limited to, Iraq, Pakistan, Yemen and Indonesia."
The complaint further claims, "AWB unfair advantage conspirators
formed an ongoing criminal enterprise designed to implement
tactics known to violate international laws and U.S. domestic
laws to effect an unfair competitive advantage for AWB in
specific international wheat markets."
Attorneys are demanding a jury trial, tens of millions of
dollars in compensation, the application of racketeering law
provisions, which would allow the tripling of any damages and
appropriate "additional or alternative relief."
Several U.S. lawyers, including Washington attorney L. Palmer
Foret and Atlanta-based lawyer Roderick E. Edmond, who
specialises in medical negligence cases, are handling the
lawsuit.
Farmers had hoped to sue AWB using the RICO or racketeering
laws, which were designed to bankrupt the Mafia. However, U.S.
lawyers were unable to convincingly show the court how AWB's
actions had harmed U.S. wheat farmers and thus the suit was
withdrawn.
For more details, contact:
(1) Roderick E. Edmond of Edmond & Jones, LLP, Candler
Building, 127 Peachtree Street NE, Suite #410, Atlanta,
GA 30303, Phone: (404) 525-1080, Fax: (404) 525-1073,
E-mail: http://www.edmondfirm.com/index.html;and
(2) L. Palmer Foret, The Law Firm of Palmer Foret, PC, Two
Wisconsin Avenue, Suite 660, Chevy Chase, MD 20815,
Phone: (301) 656-1888, E-mail: lpforet@aol.com.
BOEING CO: Ex-Workers' Suit in Kans. Gets Class Certification
-------------------------------------------------------------
The U.S. District Court for District of Kansas granted
conditional class certification to a lawsuit filed by former
Boeing Wichita workers against Boeing Co., Spirit AeroSystems
and Onex Corp., Molly McMillin of The Wichita Eagle reports.
The decision allows the suit, alleging age discrimination, to
proceed as a class action. Attorney Lawrence Williamson of
Shores, Williamson & Ohaebosim in Wichita explains that with the
decision they are now clear to pursue the action in a collective
manner.
On March 2, 2006, the Boeing was served with a complaint in
Wichita, Kansas, alleging that hiring decisions made by Spirit
Aerosystems near the time of the Boeing's sale of the Wichita
facility were tainted by age discrimination (Class Action
Reporter, May 12, 2006).
The case, filed on Dec. 19, 2005, was brought as a class action
on behalf of individuals not hired by Spirit. Pursuant to an
indemnity provision in an earlier agreement, Spirit agreed to
defend and indemnify the Boeing in the case.
Specifically, workers in the case are alleging that they were
terminated from Boeing or refused employment with Spirit because
of their age.
According to Mr. Lawrence, with the court ruling the court will
now notify other individuals who have not opted into the class
action but who may have been affected by similar practices.
Court documents revealed that notices of the collective action
will be sent to former Boeing employees who were terminated
after Jan. 1, 2002, who were 40 years or older at the time of
termination by Boeing and who were not hired by Spirit
AeroSystems.
As of the moment, Mr. Lawrence divulged that about 118
plaintiffs and more than 400 individuals have opted into the
class action.
The suit is "Apsley, et al. v. The Boeing Company, et al., Case
No. 6:05-cv-01368-MLB-KMH," filed in the U.S. District Court for
the District of Texas under Judge Monti L. Belot with referral
to Judge Karen M. Humphreys.
Representing the plaintiffs are Uzo L. Ohaebosim and Lawrence W.
Williamson, Jr. of Shores, Williamson & Ohaebosim, LLC, 301 N.
Main, 1400 Epic Center, Wichita, KS 67202, Phone: 316-261-5400,
Fax: 316-261-5404, E-mail: u.ohaebosim@swolawfirm.com and
l.williamson@swolawfirm.com.
Representing the defendants are, James M. Armstrong and Carolyn
L. Matthews of Foulston Siefkin, LLP, 1551 N Waterfront Parkway,
Ste. 100, Wichita, KS 67206-4466, Phone: 316-291-9576 and 316-
267-6371, Fax: 316-267-6345, E-mail: jarmstrong@foulston.com and
cmatthews@foulston.com.
CALIFORNIA: Settlement Compliance of Ravenswood School Reviewed
---------------------------------------------------------------
Judge Thelton Henderson of the U.S. District Court for the
Northern District of California heard on Nov. 15 the status of
the ongoing legal settlement between Ravenswood School District
and plaintiffs in a class action over the school's special
education program,
The complaint was filed in 1996 against the school's system of
segregating students and its lack of qualified teachers, among
others. The school district settled the suit in 1999.
In the November hearing, Judge Henderson noted a steady progress
in the schools bid to improve its program to disabled students
in a three-year review provided by a court-appointed monitor of
the settlement, but said there still work to be done.
Ravenswood had started integrating special-education students
into regular classrooms. The district plans to spend $4.6
million on special education, plus $2.8 million more on other
compliance efforts this year. The state of California is a co-
defendant in the suit.
Ravenswood has also dramatically increased teacher retention and
quality. But only 40 percent of its special-education teachers
have the proper permanent credentials.
Parties will meet later this month to work on specifics for
implementing the latest recommendations, the report said.
CARDINAL HEALTH: Discovery Continues in Ohio Stock Fraud Suit
-------------------------------------------------------------
Discovery continues in the consolidated securities class action
against Cardinal Health, Inc. and certain of its officers and
directors that is pending in the U.S. District Court for the
Southern District of Ohio.
Since July 2, 2004, purported purchasers of the company's
securities have filed 10 purported class action complaints.
They named the company and certain of its officers and
directors, asserting claims under the federal securities laws.
These cases include:
-- "Gerald Burger v. Cardinal Health, Inc., et al., Case
No. 04 CV 575,"
-- "Todd Fener v. Cardinal Health, Inc., et al., Case No.
04 CV 579,"
-- "E. Miles Senn v. Cardinal Health, Inc., et al., Case
No. 04 CV 597,"
-- "David Kim v. Cardinal Health, Inc., Case No. 04 CV
598,"
-- "Arace Brothers v. Cardinal Health, Inc., et al., Case
No. 04 CV 604,"
-- "John Hessian v. Cardinal Health, Inc., et al., Case
No. 04 CV 635,"
-- "Constance Matthews Living Trust v. Cardinal Health,
Inc., et al., Case No. 04 CV 636,"
-- "Mariss Partners, LLP v. Cardinal Health, Inc., et al.,
Case No. 04 CV 849,"
-- "The State of New Jersey v. Cardinal Health, Inc., et
al., Case No. 04 CV 831,"
-- "First New York Securities, LLC v. Cardinal Health,
Inc., et al., Case No. 04 CV 911"
The Cardinal Health federal securities actions purport to be
brought on behalf of all purchasers of the company's securities
during various periods beginning as early as Oct. 24, 2000 and
ending as late as July 26, 2004.
The suits allege, among others, that the defendants violated
Section 10(b) of the U.S. Securities Exchange Act of 1934, as
amended, and Rule 10b-5 promulgated thereunder and Section 20(a)
of the U.S. Exchange Act by issuing a series of false and/or
misleading statements concerning the company's financial
results, prospects and condition.
Certain of the complaints also allege violations of Section 11
of the U.S. Securities Act of 1933, as amended, claiming
material misstatements or omissions in prospectuses issued by
the company in connection with its acquisition of Bindley
Western Industries, Inc. in 2001 and Syncor in 2003.
The alleged misstatements relate to the company's accounting for
recoveries relating to antitrust litigation against vitamin
manufacturers, and to classification of revenue in the company's
Pharmaceutical Distribution business as either operating revenue
or revenue from bulk deliveries to customer warehouses, and
other accounting and business model transition issues, including
reserve accounting.
The alleged misstatements are claimed to have caused an
artificial inflation in the company's stock price during the
proposed class period.
The complaints sought unspecified money damages and equitable
relief against the defendants and an award of attorney's fees.
On Dec. 15, 2004, the Cardinal Health federal securities actions
were consolidated into one action captioned, "In re Cardinal
Health, Inc. Federal Securities Litigation." On Jan. 26, 2005,
the court appointed the Pension Fund Group as lead plaintiff in
this consolidated action.
On Apr. 22, 2005, the lead plaintiff filed a consolidated
amended complaint naming the company, certain current and former
officers and employees and the company's external auditors as
defendants. The complaint seeks unspecified money damages and
other unspecified relief against the defendants.
On Mar. 27, 2006, the court granted a motion to dismiss with
respect to the company's external auditors and a former officer
and denied the motion to dismiss with respect to the company and
the other individual defendants.
On Sept. 8, 2006, the plaintiffs filed a Motion for Class
Certification. Discovery is now proceeding, according to the
company's Nov. 7 form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended Sept. 30.
The suit is "In re Cardinal Health, Inc. Securities Litigation,
Case No. 04-CV-575," filed in the U.S. District Court for the
Southern District of Ohio.
Representing the plaintiffs are:
(1) Bernstein Liebhard & Lifshitz, LLP, (New York, NY), 10
E. 40th Street, 22nd Floor, New York, NY, 10016, Phone:
800-217-1522, E-mail: info@bernlieb.com;
(2) Milberg, Weiss, Bershad, Hynes & Lerach, LLP, (San
Diego, CA), 600 West Broadway, 1800 One America Plaza,
San Diego, CA, 92101, Phone: 800.449.4900, E-mail:
support@milberg.com; and
(3) John R. Climaco, Climaco Lefkowitz Peca Wilcox &
Garofoli LPA - 1, 1228 Euclid Avenue, Suite 900,
Cleveland, OH 44115-1891, Phone: 216-621-8484, Fax:
216-771-1632, E-mail: jrclim@climacolaw.com.
Representing the company are John M. Newman, Jr., Geoffrey J.
Ritts of Jones, Day, Reavis, & Pogue, North Point, 901 Lakeside
Ave, Cleveland, OH 44114-1190, Phone: 216-586-3939, E-mail:
jmnewman@jonesday.com or gjritts@jonesday.com.
COMPUCREDIT CORP: Continues to Face N.C. Consumer Fraud Lawsuit
---------------------------------------------------------------
CompuCredit Corp. and five of the company's subsidiaries remain
defendants in a purported class action, "Knox, et al. v. First
Southern Cash Advance, et al., No. 5 CV 0445," which was filed
in the Superior Court of New Hanover County, North Carolina.
Filed on Feb. 8, 2005, the suit alleges that in conducting a so-
called "payday lending" business, certain of the company's
Retail Micro-Lending and Servicing segment subsidiaries violated
various laws governing consumer finance, lending, check cashing,
trade practices and loan brokering.
Plaintiffs also allege that the company is the alter ego of its
subsidiaries and is liable for their actions. Thus, they are
seeking damages of up to $75,000 per class member, according to
its Nov. 6, 2006 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the period ended Sept. 30, 2006.
Based in Atlanta, Georgia, CompuCredit Corp. (NASDAQ: CCRT) --
http://www.compucredit.com/-- is a provider of credit and
related financial services and products to or associated with
the underserved, or sub-prime, consumer credit market, as well
as to un-banked consumers.
CONSECO INC: Reaches Settlement in Calif. Insurance Fraud Suit
--------------------------------------------------------------
Conseco, Inc., expects to implement in the first quarter of
2007, the settlement for the consolidated life insurance fraud
class action filed against it and certain subsidiaries in the
U.S. District Court for the Central District of California.
The company and certain subsidiaries, including principally
Conseco Life Insurance Company, were named in numerous purported
class action and individual lawsuits alleging, among other
things, breach of contract, fraud and misrepresentation with
regard to a change made in 2003 and 2004 in the way cost of
insurance charges are calculated for life insurance policies
sold primarily under the names "Lifestyle" and "Lifetime".
Approximately 86,500 of these policies were subject to the
change, which resulted in increased monthly charges to the
policyholders' accounts. Many of the purported class actions
were filed in federal courts across the U.S.
In June 2004, the Judicial Panel on Multidistrict Litigation
consolidated these lawsuits into the action now referred to as
"In Re Conseco Life Insurance Co. Cost of Insurance Litigation,
Cause No. MDL 1610."
In September 2004, plaintiffs in the multi-district action filed
an amended consolidated complaint and, at that time, added
Conseco, Inc. as a defendant.
The amended complaint alleges, among other things that the
change enabled Conseco, Inc. to add $360 million to its balance
sheet. It seeks unspecified compensatory, punitive and
exemplary damages as well as an injunction that would require
the company to reinstate the prior method of calculating cost of
insurance charges and refund any increased charges that resulted
from the change.
On Apr. 26, 2005, the judge in the multi-district action
certified a nationwide class on the claims for breach of
contract and injunctive relief.
On Apr. 27, 2005, the Judge issued an order certifying a
statewide California class for injunctive and restitutionary
relief pursuant to California Business and Professions Code
Section 17200 and breach of the duty of good faith and fair
dealing, but denied certification on the claims for fraud and
intentional misrepresentation and fraudulent concealment.
The company announced on Aug. 1, 2006, that it has reached a
tentative settlement of this case. Under the tentative
settlement, inforce policyholders will have an option to choose
a form of policy benefit enhancement and certain former
policyholders will share in a settlement fund by either
reinstating their policies with enhanced benefits, or electing
to receive cash. Finalizing the settlement will require court
review and approval, a fairness hearing, notice to all class
members, election of options by the class members,
implementation of the settlement and is subject to other
conditions.
The company expects to implement the settlement with the
inforce and certain former policyholders in the first quarter of
2007.
The suit is "In re Conseco Life Insurance Company Cost of
Insurance Litigation, Case No. 2:04-ml-01610-AHM-Mc," filed in
the U.S. District Court for the Central District of California
under Judge A. Howard Matz. Representing the plaintiffs are:
(1) Christopher Casper and John Yanchunis, James Hoyer
Newcomer & Smiljanich, 1 Urban Centre, 4830 W Kennedy
Blvd., Ste. 550, Tampa, FL 33609, Phone: 813-286-4100;
(2) Timothy P. Dillon of Timothy P. Dillon Law Offices, 361
Forest Avenue, Suite 205, Laguna Beach, CA 92651,
Phone: 949-376-2800, E-mail: timothy@dillonlaw.net; and
(3) John A. Yanchunis of James Hoyer Newcomer & Smiljanich,
1 Urban Centre, 4830 W Kennedy Boulevard, Suite 550,
Tampa, FL 33609, Phone: 813-286-4100, E-mail:
jyanchunis@jameshoyer.com.
Representing the company is Timothy G. Majors, Brent L. Caslin
and Michael S. McCauley of Kirkland & Ellis, 777 S. Figueroa
St., Ste. 3700, Los Angeles, CA 90017, Phone: 213-680-8400 and
213-680-8686, E-mail: bcaslin@kirkland.com and
mmccauley@kirkland.com.
CONSECO INSURANCE: Nov. 2007 Trial Set for Calif. Consumer Suit
---------------------------------------------------------------
A Nov. 13, 2007 trial is scheduled for the consolidated consumer
fraud class action pending in U.S. District Court for the
Northern District of California against Conseco Insurance Co.
over the sale of annuity products to seniors 65 years and older.
On Nov. 17, 2005, the complaint "Robert H. Hansen v. Conseco
Insurance Co., f/k/a Conseco Annuity Assurance Co., Case No.
C0504726" was filed in the U.S. District Court for the Northern
District of California.
Plaintiff in this putative class action purchased an annuity in
2000 and is claiming relief on behalf of the proposed national
class over alleged:
-- violations of the Racketeer Influenced and
Corrupt Organizations Act;
-- elder abuse;
-- unlawful, deceptive and unfair business practices;
-- unlawful, deceptive and misleading advertising;
-- breach of fiduciary duty; aiding and abetting of breach
of fiduciary duty; and
-- unjust enrichment and imposition of constructive trust.
On Jan. 27, 2006, a similar complaint was filed in the same
court: "Friou P. Jones, on Behalf of Himself and All Others
Similarly Situated v. Conseco Insurance Company, an Illinois
company f/k/a Conseco Annuity Assurance Company, Cause No. C06-
00537." Mr. Jones had purchased an annuity in 2003.
Each case alleged that the annuity sold was inappropriate and
that the annuity products in question are inherently unsuitable
for seniors age 65 and older.
On Mar. 3, 2006 a first amended complaint was filed in the
Hansen case adding Friou P. Jones as a named plaintiff and
adding causes of action for fraudulent concealment and breach of
the duty of good faith and fair dealing.
This in effect has consolidated the two cases, and the original
Jones case will be dismissed. A motion to dismiss the amended
complaint was filed on July 28, 2006 and was heard on Oct. 27,
2006.
The court has set plaintiff's motion for class certification for
hearing on March 30, 2007, and the case is set for trial
commencing Nov. 13, 2007.
The suit is "Robert H. Hansen v. Conseco Insurance Co., Case No.
5:05-cv-04726-RMW," filed in the U.S. District Court for the
Northern District of California under Judge Ronald M. Whyte with
referral to Judge Richard Seeborg.
Representing the plaintiffs are:
(1) Howard D. Finkelstein of Finkelstein & Krinsk, 501 West
Broadway, Suite 1250, San Diego, CA 92101-3593, Phone:
619-238-1333, Fax: 619-238-5425, E-mail:
fk@classactionlaw.com;
(2) Andrew S. Friedman of Bonnett Fairbourn Friedman &
Balint, P.C., 2901 N. Central Avenue, Suite 1000,
Phoenix, AZ 85012, Phone: 602-274-1100, Fax: 602-274-
1199; and
(3) John J. Stoia, Jr. of Lerach Coughlin Stoia Geller
Rudman & Robbins, LLP, 655 West Broadway, Suite 1900,
San Diego, CA 92101, Phone: (619) 231-1058, Fax: (619)
231-7423, E-mail: jstoia@lerachlaw.com.
Representing the defendants are, Thomas A. Doyle, James J. Dries
and Mark L. Karasik of Baker & McKenzie, LLP, 130 E. Randolph,
Drive, Suite 3500, Chicago, IL 60601, Phone: 312-861-8000, Fax:
312-861-2899, E-mail: Thomas.A.Doyle@bakernet.com,
James.J.Dries@bakernet.com and Mark.L.Karasik@bakernet.com.
CROSS COUNTRY: Agrees to Settle Calif. Wage Suit for Up to $10M
---------------------------------------------------------------
Cross Country Healthcare, Inc. reached a tentative $10 million
settlement for the wage and hour class action that was brought
on behalf of the company's field employees.
On Aug. 26, 2003, a purported class action, "Theodora Cossack,
et al. v. Cross Country TravCorps and Cross Country Nurses,
Inc.," was filed in the Superior Court of the State of
California, for the County of Orange.
Plaintiffs plead causes of action for:
-- violation of California Business and Professions Code
Section 17200, et. seq;
-- violations of California Labor Code Section 200, et.
seq;
-- recovery of unpaid wages and penalties;
-- conversion;
-- breach of contract;
-- common counts - work, labor, services provided; and
-- common counts - money had and received.
Plaintiffs, who purport to sue on behalf of themselves and all
others similarly situated allege that defendants failed to pay
plaintiffs, and the class they purport to represent, properly
under California law.
They specifically claim that defendants:
-- failed to pay nurses hourly overtime as required by
California law;
-- failed to calculate correctly their employees' regular
rate of pay used to calculate the rate at which
overtime hours are to be compensated;
-- failed to calculate correctly and pay a double time
premium for all hours worked in excess of 12 in a
workday;
-- scheduled some of its employees on an alternative
workweek schedule, but failed to pay them additional
compensation when those employees did not work such
alternative workweek, as scheduled; and
-- failed to pay employees for the minimum hours
defendants had promised them.
On Feb. 10, 2006, the Superior Court of the State of California
granted plaintiffs leave to amend the complaint to add causes of
actions alleging defendant's failure to pay for missed meal
periods and rest breaks.
Although Cross Country Nurses, Inc. was previously dismissed
from the action upon defendants' motion for summary judgment
plaintiffs have erroneously included Cross Country Nurses, Inc.
in the caption and allegations of the amended complaint they
filed.
On Mar. 10, 2006, defendants removed this putative class action
to the U.S. District Court for the Central District of
California in Orange County.
Plaintiffs filed a motion requesting that the case be remanded
to state court, which was granted on Apr. 28, 2006. Defendants
previously said it would appeal the motion to the U.S. Court of
Appeal for the Ninth Circuit by May 5, 2006.
Plaintiffs are seeking:
-- an order enjoining defendants from engaging in the
practices challenged in the complaint;
-- for an order for full restitution of all monies
defendants allegedly failed to pay Plaintiffs (and
their purported class);
-- for pre-judgment interest; for certain penalties
provided for by the California Labor Code; and
-- for attorneys' fees and costs.
On July 28, 2006, plaintiff filed a motion for class
certification.
On Sept. 5, 2006, plaintiff filed the third amended complaint
alleging a Fourth Cause of Action for violation of the Fair
Labor Standards Act and failure to pay the amount of premium pay
required under the FLSA when putative class members worked more
than 40 hours in a week.
On Sept. 7, 2006, defendants filed to remove the lawsuit from
the Superior Court of the State of California for the County of
Orange to the U.S. District Court Central District of
California.
The case was tentatively settled in August for $10.0 million and
on Aug. 23, 2006, plaintiff filed a motion for preliminary
approval of a settlement pursuant to which defendants would pay
up to $10.0 million, including payments to eligible nurses, the
named plaintiff, plaintiff's attorney fees and administrative
costs.
Payments to eligible nurses would be on a "claims made" basis,
which means that the company's total liability could be reduced
to the extent that nurses who are eligible to participate in the
settlement do not submit claims through the settlement
administration process.
On Oct. 30, 2006, the court issued an order granting the motion
for preliminary approval of the settlement and ordering, among
other things, that the class be preliminarily certified under
Federal Rule of Civil Procedure 23(b)(3) for settlement
purposes.
The company anticipates a final approval on or about Feb. 26,
2007, according to the company's Nov. 7, 2006 Form 10-Q filing
with the U.S. Securities and Exchange Commission for the period
ended Sept. 30, 2006.
The suit is "Cossack et al. v. Cross Country Travelcorps, et
al., Case No. 8:06-cv-00266-DOC-RNB," filed in the U.S. District
Court for the Central District of California under Judge David
O. Carter with referral to Judge Robert N. Block.
Representing the plaintiffs are:
(1) Joseph Antonelli of Joseph Antonelli Law Offices, 1000
Lakes Drive, Suite 450, West Covina, CA 91790, Phone:
626-917-6228, E-mail: jantonelli@antonellilaw.com;
(2) Kevin T. Barnes of Kevin T. Barnes Law Offices, 5670
Wilshire Blvd., Suite 1460, Los Angeles, CA 90036,
Phone: 323-549-9100, E-mail: barnes@kbarnes.com;
Representing the defendants are, Enzo Der Boghossian, Arthur F.
Silbergeld and Michael H. Weiss of Proskauer Rose, 2049 Century
Park East, 32nd Floor, Los Angeles, CA 90067-3206, Phone: 310-
557-2900, E-mail: asilbergeld@proskauer.com and
mweiss@proskauer.com.
CROSS COUNTRY: Calif. Court Denies Class Status for Labor Suit
--------------------------------------------------------------
The U.S. District Court for the Central District of California
denied class-action status to a lawsuit filed on June 21, 2005
against Cross Country Healthcare, Inc., its MedStaff subsidiary,
and a number of its individual officers, according to the
company's Nov. 7, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the period ended Sept. 30, 2006.
The lawsuit relates only to corporate employees purportedly
employed by the company and/or MedStaff, but based on its
allegations appears to be limited to MedStaff corporate
employees.
It alleges, among other things, violations of certain sections
of the federal Fair Labor Standards Act, the California Labor
Code, the California Business and Professions Code, as well as
claims for breach of contract, unjust enrichment and the
recovery of unpaid wages and penalties.
Plaintiff Darrelyn Renee Henry, who purports to sue on behalf of
herself, and all other similarly situated employees, purport to
encompass a nationwide (rather than a California only) putative
class of employees.
Ms. Henry alleges that the Company and/or MedStaff failed, under
both federal and California law, to timely and properly
compensate employees for all hours worked (including overtime)
and to provide at least the minimum amount of compensation
required for those hours.
She also alleges that the Company and/or MedStaff failed, under
California law only, to provide meal periods and to pay for
those missed meal periods, suffered employees to work in excess
of 16 hours per day, and breached employment contracts as to the
terms of compensation for all hours worked and the provision of
compensated meal and rest periods.
Plaintiffs seek, among other things, an order enjoining the
company and MedStaff from engaging in the practices challenged
in the complaint, an order for full restitution of all monies
the Company and/or MedStaff allegedly failed to pay plaintiffs
and their purported class, interest, liquidated damages as
provided for by the Fair Labor Standards Act, penalties as
provided for by the California Labor Code, an equitable
accounting and attorneys' fees and costs.
On Feb. 27, 2006, the U.S. District Court for the Central
District of California filed an order denying plaintiff's
certification of a collective action pursuant to 29 U.S.C.
Section 216(b) (Fair Labor Standards Act claims) without
prejudice and holding on submission plaintiff's Rule 23 motion
for certification of a class action solely with respect to
California employees based on California law.
On April 24, 2006, the U.S. District Court of California filed
an order to preliminarily certify a collective action based on
the Fair Labor Standards Acts claims, subject to Defendants
ability to move for decertification at a later stage in the
proceedings.
The court, however, limited the scope of the preliminarily
certified collective action to encompass claims occurring within
a 2-year statute of limitations and limited to 90 days the
period of time within which putative members of the
preliminarily certified collective action group may opt-into the
action.
It denied certification of a class action pursuant to Fed. R.
Civ. P. 23 for claims made under California state law, but
indicated that it will exercise supplemental jurisdiction as to
the California law claims of those individuals who opt into the
Fair Labor Standards Act claims.
On June 9, 2006, stipulated notices and consent to join forms
were sent by a mutually agreed upon third party administrator to
the putative members of the collective action group, thus
triggering the start of the 90 day opt-in period.
Additional notices were sent out to certain putative members of
the collective action group on August 31, 2006, which provided a
potential extension of the opt-in period.
The opt-in period has ended for all putative members of the
collective action group. A total of only fifteen (15)
individuals (including Plaintiff) have opted-into the
conditionally certified collective action and have timely filed
consent to join forms.
The suit is "Darrelyn Henry, et al. v. Med-Staff, et al., Case
No. 8:05-cv-00603-DOC-AN," filed in the U.S. District Court for
the Northern District of California under Judge David O. Carter.
Representing the plaintiffs are Henry Hwang, Gregory G.
Petersen, Castle Petersen & Krause, 4675 MacArthur Court, Suite
1250, Newport Beach, CA 92660, Phone: 949-417-5600 E-mail:
atty@cpk-law.com.
Representing the company are Enzo Der Boghossian, Kathleen
Frances Paterno, Arthur F. Silbergeld, and Michael H. Weiss of
Proskauer Rose, 2049 Century Park East, 32nd Floor, Los Angeles,
CA 90067-3206, 310-557-2900, Phone: asilbergeld@proskauer.com or
mweiss@proskauer.com.
DIRECT GENERAL: Faces Fla. Suit Over Insurance Policy Offerings
---------------------------------------------------------------
Direct General Corp. faces class actions in Florida over
allegations that certain agents and customer representatives of
the company used improper sales practices in selling ancillary
and other insurance products to customers in connection with
their purchase of automobile insurance policies.
The company and one or more of its subsidiaries are named
defendants in a number of currently pending putative class
action lawsuits.
During the third quarter of 2006, the plaintiff's motion for
class certification in the previously reported action filed in
U.S. District Court for the Middle District of Tennessee was
granted.
In addition, earlier this year one of the previously reported
purported class actions filed against us in Florida in April
2003, alleging improper cancellation of insurance policies, was
settled with the individually named plaintiff for an immaterial
amount.
In August 2006, the Florida Department of Financial Services
issued a press release stating that it had filed administrative
charges against certain agents and customer representatives
employed or formerly employed by our agency subsidiary in
Florida.
The charges recited in the press release allege that some of
these individuals had used improper sales practices in selling
ancillary and other insurance products to customers in
connection with their purchase of automobile insurance policies.
A few weeks following this press release, the company received
service of a complaint in a new purported class action in
Florida:
* Julie Buell vs. Direct General Insurance Agency, Inc.,
and Direct General Insurance Company
The suit was filed on Aug. 28, 2006 in the Circuit Court of the
6th Judicial Circuit in and for Pasco County, Florida.
It alleges that defendants had used improper sales practices
identical to some of the practices that had been recited in the
Florida Department's press release. This lawsuit is in its very
early procedural stages.
In addition, the other previously reported purported class
action filed against us in Florida in April 2003, which claims,
among other things, unlawful practices in connection with the
financing of supposed automobile memberships, was amended
following the Florida Department's press release and the filing
of the Buell case, to add a new claim that is identical to one
of the charges recited in the press release and also claimed in
the Buell case.
ELECTRONIC ARTS: Calif. Court Okays $15M Labor Suit Settlement
--------------------------------------------------------------
The San Mateo Superior Court in California granted final
approval to the $15 million settlement of the employment-related
class action, "Hasty v. Electronic Arts, Inc."
The suit was filed on Feb. 14, 2005 in the San Mateo Superior
Court in California. It alleges that the company improperly
classified "engineers" in California as exempt employees. It
seeks injunctive relief, unspecified monetary damages, interest
and attorneys' fees.
On May 16, 2006, the court granted preliminary approval of the
settlement pursuant to which the company agreed to make a lump
sum payment of approximately $15 million, to be paid to a third-
party administrator, to cover:
-- all claims allegedly suffered by the class members;
-- plaintiffs' attorneys' fees, not to exceed 25% of the
total settlement amount;
-- plaintiffs' costs and expenses;
-- any incentive payments to the named plaintiffs that may
be authorized by the court; and
-- all costs of administration of the settlement.
On Sept. 22, 2006, the court granted final approval of the
settlement.
Redwood City, California-based Electronic Arts Inc. (NASDAQ:
ERTS)) -- http://www.ea.com/-- develops, markets, publishes,
and distributes interactive software games titles. It publishes
interactive software games for multiple platforms. It makes
investments in facilities and equipment that allow the company
to create and edit video and audio recordings that are used in
its games.
EQUITY OFFICE: Investors File Suit in Ill. Over Blackstone Offer
----------------------------------------------------------------
Equity Office Properties Trust faces a purported shareholders'
class action that claims a $20 billion buyout offer from
Blackstone Group, LP, is too low, Andrew Harris and Brian Louis
of Bloomberg News reports.
The suit, filed in the U.S. District Court for the Northern
District of Illinois, names as defendants Chairman Sam Zell,
nine other director-trustees, and New York-based Blackstone
Group.
In the 29-page complaint, plaintiffs' attorney Norman Rifkind
wrote that Equity Office is being sold for "the grossly
inadequate and unfair price of $48.50 per share."
The suit accuses the director-trustees of receiving preferential
treatment in the sale at shareholders' expense. Thus, it seeks
class-action status and a court order canceling the deal.
According to the complaint, defendants would be given the
opportunity to participate in the proposed acquisition, unlike
plaintiff and members of the class who will not only be
prohibited from participating in the company post-acquisition,
but will be stripped of their shares for only a fraction of
their shares' value.
The suit is "Beck v. Dombrowski, Case No. 06-6411," filed in the
U.S. District Court for the Northern District of Illinois.
FORD MOTOR: Ill. Court Refuses to Dismiss Suit Over Flaky Paints
----------------------------------------------------------------
Madison Circuit Judge Andy Matoesian denied a request by Ford
Motor Co. to dismiss a third amended complaint in a class action
over flaky paint on certain models of the company's vehicles,
The Madison St. Clair Record reports.
In a Nov. 9 order, Judge Matoesian gave Ford 28 days to answer.
Ketrina Bakewell at Bryan Cave LP, the law firm representing
Ford Motor Co., asked Judge Matoesian on Sept. 15 to dismiss the
complaint (Class Action Reporter, Sept. 25, 2006).
Ms. Bakewell claims that statutes of limitations ran out years
ago on claims of new Lakin Law Firm plaintiffs. She said in a
memorandum with her motion to dismiss that plaintiffs all knew
paint was coming off their vehicles years before they filed
suit. The models referred to in the case are those from 1989 to
1996.
In 1999, The Lakin Law Firm filed the suit against Ford Motor
Co. on behalf of owners of vehicles that have experienced paint
peeling.
Plaintiffs contend that their paint is defective in two
respects. First, they allege that, because the company did not
use spray primer between the high-build electro coat and the
color coat in some models, the color coat lost adhesion to the
HBEC after extended exposure to ultraviolet radiation from
sunlight. Second, they allege that the clearcoat on some models
deteriorated prematurely.
Plaintiffs seek unspecified punitive damages, attorneys' fees
and interest, and compensatory damages in an amount to cover the
cost of repainting their vehicles and to compensate for alleged
diminution in value.
In 2003, Circuit Judge Phillip Kardis certified Elaine Phillips,
a secretary of the firm, as representative of two nationwide
classes of plaintiffs.
After Judge Kardis retired, the case was assigned to Judge
Matoesian.
In March, Ford Motor moved to decertify the class action, based
on last year's Illinois Supreme Court decision in Avery v. State
Farm, and Ms. Phillips chose to drop out as class representative
of the case.
In 2005 the Lakin firm added Beverly Brede of St. Clair County
and Joseph Gulash of Madison County as plaintiffs, and it
changed the definition of the class.
Ford Motor moved to stay discovery pending a ruling on the
decertification motion, but Judge Matoesian ruled Aug. 18 that
discovery on decertification issues could continue.
Also, in August, the Lakin firm filed a third amended complaint
proposing to certify Daniel Schopp of Madison County as class
representative. Ms. Brede and Mr. Gulash remained in the case,
and the Lakin firm added Norma Maag of St. Clair County and
Peter Yaciuk of St. Louis County, Missouri, as plaintiffs.
Representing Ford are Peter Herzog of Bryan Cave LLP, One
Metropolitan Square, 211 North Broadway, Suite 3600, St. Louis,
MO 63102-2750, Phone: 314/259-2000, Fax: 314/259-2020; and
Ketrina Blakewell of Bryan Cave LLP, 161 North Clark, Suite 4300
Chicago, IL 60601-3315, Phone: 312/602-5000, Fax: 312/602-5050
Representing the plaintiffs is Robert Schmieder of the Lakin Law
Firm, 300 Evans Avenue, PO Box 229, Wood River, Illinois 62095,
Phone: (618) 254-1127, Fax: (618) 254-0193.
INTERNATIONAL BUSINESS: Settles Calif. Labor Lawsuit for $65M
-------------------------------------------------------------
International Business Machines Corp. agreed to resolve an
overtime pay class action filed in U.S. District Court for
northern California for $65 million, reports say.
The suit is "Rosenburg et al. v. IBM Corp., Case No. 3:06-cv-
00430-PJH," under Judge Phyllis J. Hamilton.
On Jan. 24, 2006, a putative class action was filed against IBM
on behalf of technical support workers whose primary
responsibilities are or were to install and maintain computer
software and hardware (Class Action Reporter, Jan. 26, 2006).
The complaint was subsequently amended on March 13, 2006. The
First Amended Complaint, among other things, adds four
additional named plaintiffs and modifies the definition of the
workers purportedly included in the class.
The suit alleges the company failed to pay overtime wages
pursuant to the Fair Labor Standards Act and state law, and
asserts violations of various state wage requirements, including
record keeping and meal-break provisions. It also asserts
certain violations of the Employee Retirement Income Security
Act.
Specifically, the suit charges that IBM deprives its employees
who install, maintain, and support computer software and
hardware by unlawfully characterizing them as "exempt" from
state and federal labor law protections.
The proposed classes consist of current and former IBM technical
support workers with the primary duties of installing and/or
maintaining computer software and hardware for IBM who were
wrongly classified by the company as exempt from the overtime
provisions of federal law and/or applicable state wage and hour
laws.
Relief sought includes back wages, corresponding 401K and
pension plan credits, interest, and attorneys' fees.
Representing the plaintiffs are:
(1) James M. Finberg of Lieff Cabraser Heimann & Bernstein,
LLP, Phone: 415-956-1000;
(2) Todd F. Jackson of Lewis Feinberg Renaker & Jackson,
P.C., Phone: 510-839-6824;
(3) Steven G. Zieff of Rudy, Exelrod & Zieff, LLP, Phone:
415-434-9800 or 800-869-0165;
(4) Adam T. Klein of Outten & Golden LLP, Phone: 212-245-
1000;
(5) Ira Spiro of Spiro, Moss, Barness, Harrison & Barge,
LLP, Phone: 310-235-2468;
(6) J. Derek Braziel of Lee & Braziel, LLP, Phone: 214-749-
1400;
(7) Richard Burch of Bruckner Burch, PLLC, Phone: 713-877-
8065;
(8) David Borgen of Goldstein, Demchak, Baller, Borgen &
Dardarian, Phone: 510-763-9800.
Representing the company is Donna M. Mezias of Jones Day, 555
California Street, 26th Floor, San Francisco, CA 94104, Phone:
415-875-5822, Fax: 415-875-5700, E-mail: dmezias@jonesday.com.
For more details, call: 1-866-397-1008 or visit the Web site:
http://www.overtimepaylawsuitagainstIBM.com.
LA SENZA: Files Motion to Dismiss Calif. Suit Over Wet Seal Deal
----------------------------------------------------------------
The U.S. District Court for the Central District of California
heard arguments on a motion by La Senza Corp. to dismiss a
complaint relating to its disposal of interest in The Wet Seal
Inc.
On Aug. 19, 2004, a class action suit was filed against the
company and certain of its officers in the U.S. District Court
for the Central District of California, alleging that the
company and two of its officers violated section 20A of the U.S.
Securities Exchange Act of 1934 relating to contemporaneous
insider trading in relation to the sale by the company of its
investment in The Wet Seal.
On Sept. 12, 2005, the court granted a motion to dismiss, which
was filed by the company and its officers. An amended complaint
was filed with the court on Nov. 23, 2005.
Defendants have filed motions to dismiss plaintiffs' amended
consolidated complaint, which were heard by the court on Oct.
23, 2006 and the matter was taken under submission.
The suit is "Alexander Vinokurov v. Wet Seal, Inc., et al., Case
No. 2:04-cv-07159-GAF-CT," under Judge Gary A. Feess with
referral to Judge Carolyn Turchin.
Representing the defendants are:
(1) Seth A. Aronson at O'Melveny & Myers, 400 S Hope St,
15th Fl Los Angeles, CA 90071-2899, Phone: 213-430-
6000, E-mail: saronson@omm.com; and
(2) David F Berry at Nagler & Associates, 2300 S Sepulveda
Blvd., Los Angeles, CA 90064-1911, Phone: 310-473-1200,
Fax: 310-473-7144.
Representing the consolidated plaintiff, Laborers International
Union of North America, are:
(1) William J. Doyle, II at Lerach Coughlin Stoia Geller
Rudman and Robbins, 655 West Broadway, Suite 1900, San
Diego, CA 92101, Phone: 619-231-1058, Fax: 619-231-
7423; and
(2) Michael M. Goldberg at Glancy Binkow and Goldberg, 1801
Avenue of the Stars, Suite 311, Los Angeles, CA 90067,
Phone: 310-201-9150.
LEADIS TECHNOLOGY: Court Mulls Appeal for Calif. Securities Suit
----------------------------------------------------------------
The U.S. Court of Appeals for the Ninth Circuit has yet to rule
on an appeal in the consolidated securities class action against
Leadis Technology, Inc., and certain of its officers and
directors.
On March 2, 2005, a securities class action was filed in the
U.S. District Court for the Northern District of California
against the defendants.
The complaint alleges the defendants violated Sections 11 and 15
of the Securities Act of 1933 by making allegedly false and
misleading statements in the company's registration statement
and prospectus filed on June 16, 2004 for the company's initial
public offering.
Another similar action was filed on March 11, 2005. On April
20, 2005, the court consolidated the two actions.
The consolidated complaint seeks unspecified damages on behalf
of a class of purchasers that acquired shares of the company
common stock pursuant to its registration statement and
prospectus.
The claims appear to be based on allegations that at the time of
the IPO demand for the company's color organic light-emitting
diodes products was already slowing due to competition from one
of its existing customers and that the company failed to
disclose that it was not well positioned for continued success
as a result of such competition.
On Oct. 28, 2005, the company and other defendants filed a
motion to dismiss the lawsuit.
By a March 1, 2006 order, the court granted defendants' motion
to dismiss, with prejudice, and a judgment was entered in favor
of the company and all other defendants.
On or about March 28, 2006, plaintiffs filed a notice of appeal
with the U.S. Court of Appeals for the Ninth Circuit, where it
is now pending, according to the company's Nov. 7, 2006 Form 10-
Q filing with the U.S. Securities and Exchange Commission for
the period ended Sept. 30, 2006.
The suit is "Safron Capital Corporation v. Leadis Technology,
Inc. et al., Case No. 3:05-cv-00882-CRB," filed in the U.S.
District Court for the Northern District of California under
Judge Charles R. Breyer.
Representing the plaintiffs is Patrick J. Coughlin, Lerach
Coughlin Stoia Geller Rudman & Robbins, LLP, 100 Pine Street,
Suite 2600, San Francisco, CA 94111, Phone: 415/288-4545, Fax:
415-288-4534, E-mail: patc@mwbhl.com.
Representing the defendants are Grant P. Fondo and Laura R.
Smith of Cooley Godward, LLP, Five Palo Alto Square, 3000 El
Camino Real, Palo Alto, CA 94306-2155, Phone: 650 843-5458, Fax:
650 857-0663, E-mail: gfondo@cooley.com or smithlr@cooley.com.
LYCOMING ENGINES: Faces Suit in Ill. Over Defective Crankshafts
---------------------------------------------------------------
Lycoming Engines, AVCO Corp. and Textron, Inc., were named as
defendant in a purported class action filed in Cook County
Circuit Court in Illinois over allegedly faulty engine
crankshafts.
The suit was filed the Jones Law Offices and Ralph C. Hardesty &
Associates, claiming class action status for a pool of victims
estimated at over 5000.
It was filed in response to the Federal Aviation Administration
(FAA) airworthiness directive mandating the replacement of
certain Lycoming crankshafts.
The class action seeks:
-- entry of an order enjoining the defendants from denying
the defective nature of the Lycoming crankshafts
-- to force defendants to recall the crankshafts, and
-- to pay all costs and expenses associated with replacing
all such crankshafts.
The "early retirement" program announced by Lycoming in February
2006, impacts over 5000 planes in the U.S. and is a direct
result of Lycoming's defective design, manufacture and testing
of its engines, the suit states.
According to the suit, for years defendants have known about
these problems, which can lead to premature failure of the
engine crankshafts causing power loss, engine failure, damage to
the airplane, personal injury, and loss of life.
Additionally, the suit states that that "early retirement"
program forces owners to pay for the replacement of the
defective and unsafe crankshafts, instead of issuing a recall
whereby defendants would bear the costs of repair.
In essence, the suit alleges that defendants have engaged in
deceptive, unlawful and unfair conduct in regards to the
crankshaft issue.
An issue that the suit says is the result of fundamental design
defects caused by a series of cost cutting measures introduced
by Lycoming in the 1990s.
Specifically, the suit revolves around five counts:
-- COUNT I: Illinois Consumer Fraud Statute On Behalf of
the Illinois Consumer Subclass
-- COUNT II: Intentional Misrepresentation on Behalf of
The Plaintiff Class
-- COUNT III: Product Liability on Behalf of the Entire
Class of Plaintiffs
-- COUNT IV: Negligence on Behalf of the Plaintiff Class
-- COUNT V: For Equitable Relief
The suit mirrors allegations similar to a previously filed class
action in the U.S. District Court for the Eastern District of
California. That suit was also filed against the same
defendants in the Illinois case.
Richard A. Bristow, a resident of Carmichael, California filed
the suit for himself and a class of others similarly situated in
California, who own or lease airplanes with piston aircraft
engines manufactured by Lycoming and subject to Lycoming's
"Mandatory Early Retirement" Service Bulletin Nos. 569 and 569A
(Class Action Reporter, Sept. 19, 2006).
Lycoming Engines is a division of AVCO Corp. and a wholly owned
subsidiary of Textron, Inc.
For more details, contact:
(1) The Jones Law Offices, 175 S. 3rd St., Suite 800,
Columbus, Ohio 43215, Phone: 614-221-2300, Fax: 614-
221-8428, Web site: http://www.joneslawoffices.net;and
(2) Ralph C. Hardesty & Associates, 25 E. Washington St.,
Chicago, IL 60602-1708, Phone: 312-346-9911.
MEDSTAFF INC: Class Status Sought for Calif. Overtime Wage Suit
---------------------------------------------------------------
Plaintiffs in a purported class action against Medstaff, Inc., a
subsidiary of Cross Country Healthcare, Inc., which is pending
in the Superior Court of California in Riverside County, have
filed a motion for class certification of their case.
Filed on Feb. 18, 2005, the lawsuit, "Maureen Petray and Carina
Higareda v. MedStaff, Inc.," relates to MedStaff corporate
employees. It alleges, violations of certain sections of the
California Labor Code, the California Business and Professions
Code, and recovery of unpaid wages and penalties.
MedStaff currently has less than 50 corporate employees in
California. Plaintiffs, Maureen Petray and Carina Higareda
purport to sue on behalf of themselves and all others similarly
situated, allege that MedStaff:
-- failed, under California law, to provide meal period
and rest breaks and pay for those missed meal periods
and rest breaks;
-- failed to compensate the employees for all hours
worked;
-- failed to compensate the employees for working
overtime; and
-- failed to keep appropriate records to keep track of
time worked
Plaintiffs seek:
-- an order enjoining MedStaff from engaging in the
practices challenged in the complaint;
-- for an order for full restitution of all monies
MedStaff allegedly failed to pay plaintiffs and their
purported class;
-- for interest;
-- for certain penalties provided for by the California
Labor Code; and
-- for attorneys' fees and costs.
The court ordered plaintiffs to file a motion for class
certification by Sept. 5, 2006. On July 21, 2006, the company
filed a motion seeking a stay of all proceedings until the
conditionally certified collective action in "Henry v. MedStaff,
Inc., et al.," has been either decertified or granted final
certification.
On Aug. 25, 2006, the court granted in part the company's motion
and prohibited plaintiffs from filing a motion for class
certification prior to Oct. 16, 2006.
A joint stipulation was subsequently filed prohibiting
plaintiffs' from moving for class certification prior to Oct.
25, 2006 in order to allow for the completion of pre-
certification discovery and to allow for the completion of the
opt-in period in "Henry v. MedStaff, Inc., et al."
On Oct. 27, 2006, plaintiffs filed a motion for class
certification, according to Cross Country's Nov. 7, 2006 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the period ended Sept. 30, 2006.
Boca Raton, Florida-based Cross Country Healthcare, Inc.
(NASDAQ: CCRN) -- http://www.crosscountry.com/ccinc/-- is a
provider of healthcare staffing services in the U.S. Its
healthcare staffing business segment is comprised of travel and
per diem nurse staffing, allied health staffing, as well as
clinical research trials staffing. Cross Country's brands
include Cross Country TravCorps and MedStaff.
MERCK & CO: La. Judge Junks Suit by Vioxx Users in 9 Countries
--------------------------------------------------------------
Judge Eldon Fallon of the U.S. District Court for the Eastern
District of Louisiana has dismissed foreign class action claims
previously brought against Merck & Co. Inc. by VIOXX users from
nine countries.
Merck Co.had requested dismissal arguing that the nine countries
-- England, South Africa, Poland, the Netherlands, Israel,
Germany, Australia, New Zealand, and Canada -- have appropriate
legal systems in which citizens may pursue their allegations and
that those plaintiffs should not have their claims heard in the
United States.
The plaintiffs agreed to the dismissal provided the plaintiffs
have an opportunity to file suit in their own countries. The
order dismissing the nine class action claims was issued Nov.
20.
The dismissal is consistent with an August decision by the same
federal judge who ruled that it is not appropriate for
plaintiffs from France and Italy to file claims in the U.S.
courts because they have appropriate legal forums in their own
countries.
"This is a proper ruling because it makes little sense to try
these cases here in the United States when these individuals
have perfectly appropriate judicial systems in their own home
countries," said Ted Mayer, Merck's outside counsel with the law
firm of Hughes Hubbard & Reed LLP.
"In fact, the foreign courts are more appropriate than those in
the United States because the plaintiffs live there, they were
prescribed the medicine there, they ingested it there, they were
treated there, their medical records are there, and their
physicians live there."
In addition, the regulatory agencies overseas operate under
their own regulatory rules, not those of the United States, and
their regulatory regimes are different from those in the United
States, the company said in a statement.
This order is appropriate because many U.S. courts have
previously held that it would be inappropriate for a U.S. court
-- or, for that matter, a U.S. jury -- to second-guess another
country's regulatory judgment, according to Merck.
In October, a state court in New Jersey dismissed 98 individual
VIOXX cases previously filed in New Jersey by plaintiffs from
the United Kingdom.
Litigation Status
Of the 16 cases scheduled for trial and no longer pending, only
four have resulted in a plaintiff's verdict. Juries have
decided in Merck's favor in seven cases and five cases have been
dismissed.
The plaintiffs have withdrawn another five cases, previously
scheduled for trial, from the trial calendar before the claims
could reach trial.
As for the four plaintiff's verdicts, Merck already has filed an
appeal or sought judicial review in each of those cases, and in
one of those four, a federal judge overturned the damage award
shortly after trial. Additionally, a state judge set aside one
of the seven Merck verdicts.
Finally, the claims of more than 3,000 plaintiff groups, not yet
scheduled for trial, have been dismissed. That includes more
than 1,100 plaintiff groups whose claims were dismissed with
prejudice either by plaintiffs themselves or by the courts,
meaning they cannot be filed again. More than 2,000 additional
plaintiff groups have had their claims dismissed without
prejudice.
Established in 1891, Merck & Co., Inc. -- http://www.merck.com-
- currently discovers, develops, manufactures and markets
vaccines and medicines to address unmet medical needs. The
company devotes extensive efforts to increase access to
medicines through far-reaching programs that not only donate
Merck medicines but help deliver them to the people who need
them. Merck also publishes unbiased health information as a
not-for-profit service.
MERCK & CO: La. Judge Refuses to Certify Personal Injury Lawsuit
----------------------------------------------------------------
Judge Eldon Fallon of the U.S. District Court for the Eastern
District of Louisiana issued an order on Nov. 22 denying a
request by VIOXX users to certify a personal injury class
action. There are no longer any personal injury class actions
pending in the U.S. in either federal court or state court, the
company said.
Litigation Status
Of the 16 cases scheduled for trial and no longer pending, only
four have resulted in a plaintiff's verdict. Juries have
decided in Merck's favor in seven cases and five cases have been
dismissed.
The plaintiffs have withdrawn another five cases, previously
scheduled for trial, from the trial calendar before the claims
could reach trial.
As for the four plaintiff's verdicts, Merck already has filed an
appeal or sought judicial review in each of those cases, and in
one of those four, a federal judge overturned the damage award
shortly after trial. Additionally, a state judge set aside one
of the seven Merck verdicts.
Finally, the claims of more than 3,000 plaintiff groups, not yet
scheduled for trial, have been dismissed. That includes more
than 1,100 plaintiff groups whose claims were dismissed with
prejudice either by plaintiffs themselves or by the courts,
meaning they cannot be filed again. More than 2,000 additional
plaintiff groups have had their claims dismissed without
prejudice.
Case Background
Federal and state product liability lawsuits involving
individual claims as well as putative class actions have been
filed against the company with respect to Vioxx.
As of Oct. 9, 2006, the company had been served or was aware
that it had been named as a defendant in approximately 23,800
lawsuits filed on or before Sept. 30, which include
approximately 41,750 plaintiff groups, alleging personal
injuries resulting from the use of Vioxx.
Of these lawsuits, approximately, 7,450 lawsuits representing
approximately 21,950 plaintiff groups are or are slated to be in
the federal Multidistrict litigation and approximately 13,850
lawsuits representing approximately 13,850 plaintiff groups are
included in a coordinated proceeding in New Jersey Superior
Court before Judge Carol E. Higbee.
Certain of these lawsuits include allegations regarding
gastrointestinal bleeding, cardiovascular events, thrombotic
events or kidney damage.
The company has also been named as a defendant in approximately
275 putative class actions alleging personal injuries or
seeking:
-- medical monitoring as a result of the putative class
members' use of Vioxx;
-- disgorgement of certain profits under common law unjust
enrichment theories, and/or
-- various remedies under state consumer fraud and fair
business practice statutes, including recovering the
cost of Vioxx purchased by individuals and third-party
payors such as union health plans (Vioxx Product
Liability Lawsuits). The actions filed in state courts
of California, Texas and New Jersey and in the counties
of Philadelphia, Pennsylvania, and Clark County, Nevada
have been transferred to a single state court in each
location for coordinated proceedings.
In addition to the Vioxx Product Liability Lawsuits, the claims
of more than 3,000 plaintiff groups have been dismissed to date.
Of these, there have been over 1,100 plaintiff groups whose
claims were dismissed with prejudice either by plaintiffs
themselves or by the courts. More than 2,000 additional
plaintiff groups have had their claims dismissed without
prejudice.
On Feb. 16, 2005, the Judicial Panel on Multidistrict Litigation
transferred all Vioxx Product Liability Lawsuits pending in
federal courts nationwide into one Multidistrict Litigation for
coordinated pre-trial proceedings. The MDL has been transferred
to the U.S. District Court for the Eastern District of Louisiana
before Judge Fallon.
Merck's outside counsel is Ted Mayer of Hughes, Hubbard & Reed
(http://www.hugheshubbard.com/).
NOVASTAR HOME: Md. State Court Certifies Class in Jones Lawsuit
---------------------------------------------------------------
The Circuit Court for Baltimore City, Maryland granted a motion
to certify a statewide class in the suit, "Jones, et al. v.
NovaStar Home Mortgage, Inc., et al."
In April 2005, three putative class actions filed against NHMI
and certain of its affiliates were consolidated for pre-trial
proceedings in the U.S. District Court for the Southern District
of Georgia, as "In Re NovaStar Home Mortgage, Inc. Mortgage
Lending Practices Litigation."
These cases allege that NHMI improperly shared settlement
service fees with limited liability companies (LLCs) in which
NHMI had an interest alleging violations of the fee splitting
and anti-referral provisions of the federal Real Estate
Settlement Procedures Act, and alleging certain violations of
state law and civil conspiracy.
Plaintiffs seek treble damages with respect to the RESPA claims,
disgorgement of fees with respect to the state law claims as
well as other damages, injunctive relief and attorney fees. In
addition, two other related class actions have been filed in
state courts:
-- "Miller v. NovaStar Financial, Inc. et al.," was filed
in October 2004 in the Circuit Court of Madison County,
Illinois; and
-- "Jones et al. v. NovaStar Home Mortgage, Inc. et al.,
was filed in December 2004 in the Circuit Court for
Baltimore City, Maryland.
In the Miller case, plaintiffs allege a violation of the
Illinois Consumer Fraud and Deceptive Practices Act and civil
conspiracy alleging certain LLCs provided settlement services
without the borrower's knowledge.
The plaintiffs in the Miller case seek a disgorgement of fees,
other damages, injunctive relief and attorney's fees on behalf
of the class of plaintiffs.
In the Jones case, the plaintiffs allege the LLCs violated the
Maryland Mortgage Lender Law by acting as lenders and/or brokers
in Maryland without proper licenses and allege this arrangement
amounted to a civil conspiracy. The plaintiffs in the Jones'
case seek a disgorgement of fees and attorney's fees.
On July 7, 2006, the court in the Jones' case denied cross-
motions for summary judgment on the grounds that material
factual issues existed. The court granted plaintiffs' motion to
certify a statewide Maryland class.
PARMALAT SPA: Credit Suisse, BNL Settle Investors Suit for $50M
---------------------------------------------------------------
Credit Suisse Group and Italian bank Banca Nazionale del Lavoro
S.p.A. filed a memorandum of understanding in federal District
Court in Manhattan to settle for $25 million each a class action
filed by investors of Parmalat S.p.A., the Wall Street Journal
reports.
The information was revealed by Stuart Grant, managing director
of Grant & Eisenhofer, PA, which is representing Hermes Group, a
U.K. pension-fund manager that had invested in Parmalat stock.
Aside from the monetary settlement, the financial institutions
agreed to institute changes in their corporate governance that
will hopefully prevent future problems, Mr. Grant said. Details
of those governance changes have yet to be fully worked out,
according to him.
Case Background
U.S. holders of Parmalat bonds filed a securities fraud
complaint in the U.S. District Court for the Southern District
of New York against a number of Parmalat banks and auditors
claiming that during the class period -- Jan. 5, 1999 through
Dec. 18, 2003-- those individuals, along with Old Parmalat's
banks and accounting firms, structured and participated in a
series of fraudulent schemes designed to hide Old Parmalat's
growing debts to third parties and artificially inflate its
assets, revenues and ultimately, the market prices of its
securities.
The scheme culminated in Old Parmalat's financial collapse when
it was revealed that the company's total consolidated debt had
been understated by nearly $10 billion and its total net assets,
or shareholder equity, had been overstated by $16.4 billion.
Parmalat, an international food and dairy company, filed for
bankruptcy in Italy in December 2003.
In October 2005, the court in Parma, Italy issued a decree
approving a "composition" or agreement with Old Parmalat's
creditors causing Parmalat S.p.A. to formally succeed Old
Parmalat and triggering the transfer of Old Parmalat's assets
and liabilities to New Parmalat.
Thus, unlike U.S. bankruptcy, Parmalat S.p.A., or "New Parmalat"
did not get a "fresh start" with its pre-petition debts being
discharged.
Rather, it emerged with the assets and liabilities of its
predecessor companies that were not discharged in the
Extraordinary Administration.
In its first official prospectus, New Parmalat recognized that
plaintiffs in the U.S. securities class action could assert
claims against it in the U.S.
For these reasons, lead plaintiffs moved for leave to assert
federal securities fraud claims against New Parmalat based on
the actions of Old Parmalat and its officers, directors,
statutory auditors and others prior to Extraordinary
Administration.
In June, Grant & Eisenhofer and Cohen Milstein, law firms
leading a securities class action against Parmalat S.p.a., filed
a fresh motion seeking permission to amend their complaint to
assert claims against Parmalat S.p.A.
The amended complaint was filed in U.S. District Court for the
Southern District of New York. Grant & Eisenhofer represents
Parmalat shareholders, including U.K.-based Hermes Focused Asset
Management Europe Ltd. Law firm Cohen Milstein Hausfeld & Toll,
P.L.L.C. represents Parmalat's former bondholders.
The amended complaint also contains new allegations against
accounting Grant Thornton LLP, which had previously been
dismissed from the case, showing that it controlled its U.S.
affiliate, defendant Grant Thornton International, which had
participated in the fraud.
Plaintiffs also amended their claims against Credit Suisse First
Boston, now known as Credit Suisse. They added new claims
against related entities:
-- Credit Suisse First Boston International, now known as
Credit Suisse International,
-- Credit Suisse First Boston (Europe) Limited, now known
as Credit Suisse Securities (Europe) Limited, and
-- Credit Suisse Group,
for their direct participation in, or control of entities that
participated in, the fraud.
A third amended complaint has already been filed (Class Action
Reporter, Aug. 16, 2006).
In summary, defendants in this class action includes:
-- new Parmalat S.p.A.
-- Deloitte & Touche;
-- Mr. James Copeland, as an individual;
-- Grant Thornton;
-- Citigroup, including Buconero, Vialattea, Eureka
Securitization;
-- Bank of America;
-- Credit Suisse;
-- Banca Nazionale del Lavoro;
-- Banca Intesa; Morgan Stanley;
-- the law office of Pavia Ansaldo;
-- the law office of Zini Associates; and
-- other individuals.
Hermes Focus Asset Management Europe Limited; Cattolica
Partecipazioni S.p.A.; Solotrat; Societe Moderne des
Terrassements Parisiens; and Capital & Finance Asset Management,
S.A., had asked the Honorable Lewis A. Kaplan of the U.S.
District Court for the Southern District of New York to deny
separate motions filed by Grant Thornton LLP and Credit Suisse
to dismiss their third amended consolidated class action
complaint (Class Action Reporter, Sept. 25, 2006).
The suit is "In Re: Parmalat Securities Litigation, Case No.
1:04-cv-00030-LAK-HBP," filed in the U.S. District Court for the
Southern District of New York under Judge Lewis A. Kaplan with
referral to Judge Henry B. Pitman.
Representing the plaintiffs are:
(1) Patrick J. Coughlin of Milberg, Weiss, Bershad, Hynes &
Lerach, L.L.P., 100 Pine Street, San Francisco, CA
94111, Phone: (415) 288-4545;
(2) Joshua Seth Devore of Cohen, Milstein, Hausfeld & Toll,
PLLC (DC), 1100 New York Avenue, N.W. West Towen #500,
Washington, D.C., DC 20005, Phone: (202)408-4600, Fax:
(202)-408-4699, E-mail: jdevore@cmht.com;
(3) Stuart M. Grant of Grant & Eisenhofer, PA (DE), Chase
Manhattan Centre, 1201 North Market Street, Wilmington,
DE 19801, Phone: (302) 622-7000, Fax: (302) 622-7100,
E-mail: sgrant@gelaw.com; and
(4) Mario Alba, Jr. of Lerach, Coughlin, Stoia, Geller,
Rudman & Robbins, LLP(LIs), 58 South Service Road,
Suite 200, Melville, NY 11747, Phone: 631-367-7100,
Fax: 631-367-1173, E-mail: malba@lerachlaw.com.
Representing the defendants are:
(1) Christopher Moore Brubaker of Kittredge Donley Elson
Fullem & Emb (PA), 400 Market Street, Suite 200,
Philadelphia, PA 19106, Phone: (215)-829-9900, Fax:
(215)-829-9888, E-mail: cbrubaker@kdefe.com;
(2) Donald C. Moss of Moss & Moss, L.L.P., 170 East 61st
Street, New York, NY 10021, Phone: (212) 644-1000;
(3) Norina I. Edelman of Sidley Austin LLP(Washington),
1501 K Street, N.W., Washington, DC 20005, Phone: (202-
736-8739, Fax: (202)-736-8711, E-mail:
nedelman@sidley.com;
(4) Dana Leigh Post of Kramer Levin Naftalis & Frankel,
LLP, 1177 Avenue of the Americas, New York, NY 10036,
Phone: (212) 839-5667, Fax: (212) 839-5599, E-mail:
dpost@sidley.com;
(5) Howard A. Ellins of Davis Polk & Wardwell, 450
Lexington Avenue, New York, NY 10017, Phone: (212)-450-
4248, Fax: (212)-450-5548, E-mail: ellins@dpw.com;
(6) Dennis Eugene. Glazer of Davis Polk & Wardwell, 450
Lexington Avenue, New York, NY 10017, Phone: (212)-450-
4900 Fax: (212)-450-3900, E-mail:
dennis.glazer@dpw.com;
(7) Loren Kieve of Quinn, Emanuel, Urquhart, Oliver &
Hedges, 50 California Street, 22nd Flr., San Francisco,
CA 94104-2543, Phone: (415) 875-6320, Fax: (415) 875-
6700, E-mail: lorenkieve@quinnemanuel.com; and
(8) Mark Adam Kirsch of Clifford Chance US, LLP(NYC!), 31
West 52nd Street, New York, NY 10019-6131, Phone: (212)
878-8192, Fax: (212) 878-8375, E-mail:
mark.kirsch@cliffordchance.com.
REWARDS NETWORK: Appeals Court Allows Appeal of "Bistro" Ruling
---------------------------------------------------------------
The U.S. Court of Appeals for the 9th Circuit granted the
company's petition for an interlocutory appeal of the District
Court's summary judgment ruling in favor of plaintiffs in the
case, "Bistro Executive Inc., et al. v. Rewards Network Inc., et
al."
Case Background
On May 25, 2004, Bistro Executive, Westward Beach Restaurant
Holdings, LLC and MiniBar Lounge filed a complaint in the Los
Angeles County Superior Court against the company and its
subsidiaries. Plaintiffs were all participants in the company's
dining credits Purchase Plan (Dining Plan), and their respective
owners.
The complaint was brought as a putative class action and alleges
that amounts paid by the company under the Dining Plan
constituted loans in violation of California usury laws and the
California Unfair Competition Law.
The suit seeks, among other relief, damages and equitable and
injunctive relief, including disgorgement of all purported
"interest" and profits earned by the company from the Dining
Plan in California, which plaintiffs allege to be a significant
portion of an amount in excess of $300 million, and treble
damages for all purported "interest" paid within one year prior
to the filing of the complaint.
On June 25, 2004, the action was removed to the U.S. District
Court for the Central District of California.
On Oct. 11, 2005, plaintiffs' motion for class certification was
granted certifying two classes as:
(1) all California restaurants which, from May 25, 2000 to
May 25, 2004, participated in the Dining Plan and which
took a cash advance from the company pursuant to its
California Dining Plan agreements, and
(2) all persons who, from May 25, 2000 to May 25, 2004,
guaranteed payment of cash advances underlying the
company's California Dining Plan agreements.
On July 20, 2006, the U.S. District Court for the Central
District of California issued a decision denying the company's
motion for summary judgment and granting plaintiffs' motion for
summary judgment as to plaintiffs' usury and usury-based claims.
The district court did not reach any determination regarding
monetary relief.
On Aug. 23, 2006, the district court issued an order granting
the company's motion to certify an issue for interlocutory
appeal to the U.S. Court of Appeals for the Ninth Circuit.
On Aug. 30, 2006, the district court also issued an order
continuing the trial date in this matter from Oct. 3, 2006 to
Dec. 12, 2006.
On Oct. 16, 2006, the Ninth Circuit granted the company's
petition for an interlocutory appeal of the district court's
summary judgment ruling in favor of plaintiffs and set a
briefing schedule for the appeal that contemplates that briefing
will be completed in March 2007.
The suit is "Bistro Executive Inc., et al. v. Rewards Network
Inc., et al., Case No. 2:04-cv-04640-CBM-Mc," filed in the U.S.
District Court for the Central District of California under
Judge Consuelo B. Marshall with referral to Judge James W.
McMahon.
Representing the plaintiffs are:
(1) John S. Purcell, Kenneth R. Chiate, Daniel L. Brockett,
James E. Doroshow, Chandra L. Gooding of Quinn Emanuel
Urquhart Oliver & Hedges, 865 S. Figueroa St., 10th
Fl., Los Angeles, CA 90017-2543, Phone: 213-624-7707
and 213-443-3000, Fax: 213-624-0643 and 213-443-3100,
E-mail: danbrockett@quinnemanuel.com; and
(2) Anat Levy of Anat Levy and Associates, 8840 Wilshire
Boulevard, Third Floor, Beverly Hills, CA 90211, Phone:
310-358-3138, E-mail: alevy96@aol.com.
Representing the defendants are, Scott M. Pearson, Daniel A.
Rozansky and Julia B. Strickland of Stroock Stroock & Lavan,
2029 Century Park E, 18th Fl., Los Angeles, CA 90067-3086,
Phone: 310-556-5800, Fax: 310-556-5959, E-mail:
lacalendar@stroock.com.
RUBIO'S RESTAURANTS: May 2007 Trial Set for Calif. Labor Lawsuit
----------------------------------------------------------------
A May 14, 2007 trial is scheduled for the consolidated class
action against Rubio's Restaurants, Inc., which was filed in
Orange County Superior Court in California, alleging violations
of state labor laws.
On June 28, 2001, a former employee, who worked in the position
of general manager, filed a class action complaint against the
company in Orange County, California Superior Court.
A second similar class action complaint was filed in Orange
County, California Superior Court on Dec. 21, 2001, on behalf of
another former employee who worked in the positions of general
manager and assistant manager.
On May 16, 2002, these two cases were consolidated into one
action. These cases currently involve the issue of whether
employees and former employees in the general and assistant
manager positions who worked in California units during
specified time periods were misclassified as exempt and deprived
of overtime pay.
The consolidated complaint also asserts claims for alleged
missed meal and rest breaks. In addition to unpaid overtime,
Cthese cases seek to recover waiting time penalties, interest,
attorneys' fees and other types of relief on behalf of the
current and former employees that these former employees purport
to represent.
On Nov. 9, 2005, the court certified a class of assistant
managers and on March 22, 2006 the court certified a class of
general managers.
Plaintiffs have stipulated to the decertification of a meal and
rest break class and that class has been decertified.
A trial date has been set for May 14, 2007, according to the
company's Nov. 6, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the period ended Sept. 24, 2006.
Carlsbad, California-based Rubio's Restaurants, Inc. (NASDAQ:
RUBO) -- http://www.rubios.com/-- owns and operates affordable,
fast-casual Mexican restaurants under the Rubio's Fresh Mexican
Grill name with restaurants primarily in California, Arizona,
Nevada, Colorado and Utah.
SCRIPPS HEALTH: Motion to Dismiss Overcharging Suit Rejected
------------------------------------------------------------
The Hon. Judge Steven Denton substantially rejected by a Nov. 20
order an attempt by Scripps Health to dismiss a class action
that alleges that Scripps Health charges its uninsured patients
unreasonable and unconscionable prices and uses aggressive and
unfair collection practices against them.
On July 19, 2006, Phillip Franklin filed a class action cross-
complaint against Scripps Health, a self-proclaimed not-for-
profit hospital system based in San Diego, after Scripps sued
Mr. Franklin through a collection agency. Mr. Franklin was
uninsured at the time of treatment. Mr. Franklin alleged that
he, like all other uninsured patients at Scripps, was charged
unreasonable, unconscionable and excessive hospital bills.
Scripps thereafter attempted to have the case thrown out of
Court.
On Nov. 20, 2006, the Court ruled that Mr. Franklin's claims
that Scripps engaged in unfair and unlawful practices can go
forward. The court rejected Scripps' argument that existing law
permitted the conduct Mr. Franklin challenges, finding that the
law does not " ... provide Scripps with the express unfettered
right to charge uninsured patients unconscionable rates that
bear no relation to the actual services performed."
The court further found that Mr. Franklin's claim that " ... it
is unfair to represent that Scripps is a not for profit
charitable hospital, but at the same time allegedly charge
exorbitant rates to unsuspecting patients in order to maximize
profits, ... sufficiently alleges a claim premised on unfair
business practices." While the court sustained Scripps' motion
with respect to Mr. Franklin's breach of contract claims, it
also allowed Mr. Franklin the opportunity to further amend the
complaint.
"We are pleased that the court has recognized that Scripps does
not have the right to price-gouge its most vulnerable patients.
We intend to move forward and seek relief from Scripps' prices -
- which we have alleged are unreasonable -- on behalf of all of
Scripps' uninsured patients," said Kelly M. Dermody, a partner
at Lieff, Cabraser, Heimann & Bernstein, LLP, attorneys for Mr.
Franklin.
Mr. Franklin seeks relief on behalf of himself and a proposed
class consisting of tens of thousands of uninsured patients
treated at Scripps hospitals since July 19, 2002.
For more information, contact Kelly M. Dermody at Lieff Cabraser
Heimann & Bernstein, LLP, 415-956-1000, Mobile: 415-999-2585.
SHARPER IMAGE: Faces Suit Over Back-Dated Stock Option Grants
-------------------------------------------------------------
The law firm of Stull, Stull & Brody announces that a
shareholder lawsuit has been commenced against certain members
of the board of directors and certain executive officers of
Sharper Image Corp.
The complaint alleges that certain current and prior officers
and directors manipulated the prices of executive and director
stock option grants (a.k.a. back-dated stock options).
Such practice of awarding stock options to executives and
directors at artificially low prices is alleged to violate the
company's internal documents (such as the company's stock option
plan), as well as state laws governing officer and director
fiduciary duties and/or federal laws governing securities and
taxation.
In addition, the practice results in lower payments to
companies, results in those companies under-reporting
compensation expenses, and permits directors, officers and/or
executives to unjustifiably reap millions and billions of
dollars which should be disgorged and returned to the corporate
coffers thereby contributing to the financial health of the
company.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, Phone: 1-800-337-4983, Fax: 212-490-2022, E-mail:
ssbny@aol.com, Web site: http://www.ssbny.com.
SLM CORP: Parties File Motions in D.C. Consumer Suit Ruling
-----------------------------------------------------------
Motions regarding the reversal of a trial court ruling that
dismisses the amended complaint in a purported consumer fraud
class action against SLM Corp are pending before the District of
Columbia Court of Appeals.
The company was named as a defendant in a putative class action
brought by three Wisconsin residents on Dec. 20, 2001 in the
Superior Court for the District of Columbia.
The lawsuit sought to bring a nationwide class action on behalf
of all borrowers who allegedly paid "undisclosed improper and
excessive" late fees over the past three years.
Plaintiffs sought damages of $1,500 per violation plus punitive
damages and claimed that the class consisted of two million
borrowers.
In addition, plaintiffs alleged that the company charged
excessive interest by capitalizing interest quarterly in
violation of the promissory note.
On Feb. 27, 2003, the Superior Court granted the company's
motion to dismiss the complaint in its entirety. On March 4,
2004, the District of Columbia Court of Appeals affirmed the
Superior Court's decision granting the company's motion to
dismiss the complaint, but granted plaintiffs leave to re-plead
the first count, which alleged violations of the state Consumer
Protection Procedures Act.
On Sept. 15, 2004, the plaintiffs filed an amended class action
complaint. On Oct. 15, 2004, the company filed a motion to
dismiss the amended complaint with the Superior Court for
failure to state a claim and non-compliance with the Court of
Appeals' ruling.
On Dec. 27, 2004, the Superior Court granted the company's
motion to dismiss the plaintiffs' amended complaint. Plaintiffs
appealed the Superior Court's dismissal order to the Court of
Appeals.
On June 8, 2006, the Court of Appeals issued an opinion
reversing the order of the trial court dismissing the amended
complaint.
The Court of Appeals did not address the merits of the complaint
but concluded that the trial court improperly relied upon facts
extrinsic to the complaint.
It noted in the decision that the plaintiffs failed to file a
motion for class certification within the time required by the
District of Columbia rules.
The trial court conducted a status conference on Aug. 18, 2006,
and set a briefing schedule for the issue of whether plaintiffs
have waived their right to move for class certification.
The company filed its answer and on Sept. 1, 2006, it filed its
opening brief, plaintiffs have opposed and the company filed a
reply. This motion is pending, according to the company's Nov.
7, 2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended Sept. 30, 2006.
Plaintiff also filed a motion to strike the company's answer on
Sept. 1, 2006. The company opposed this motion and it is
pending.
While these motions have been pending, the trial judge recused
herself and the case will be reassigned to another Superior
Court Judge.
Reston, Virginia-based SLM Corp., also known as Sallie Mae,
(NYSE: SLM) -- http://www.salliemae.com/-- is a holding company
that trough its subsidiaries is engaged in education finance.
It provides funding, delivery and servicing support for
education loans in the U.S., primarily through its participation
in the Federal Family Education Loan Program. The company
provides a range of financial services, processing capabilities
and information technology to meet the needs of educational
institutions, lenders, students and their families, guarantee
agencies and the U.S. Department of Education. The company also
provides fee-based related products and services, and earns fees
for student loan and guarantee servicing, and student loan
default management and loan collections.
STRATEGIC ENERGY: Plaintiffs Amend Suit Over Power Supply Deal
--------------------------------------------------------------
Strategic Energy, L.L.C., a subsidiary of KLT Energy Services,
remains a defendant in a purported class action over its Power
Supply Coordination Service Agreements.
In 2005, a class action complaint for breach of contract was
filed against the company in the Court of Common Pleas of
Allegheny County, Pennsylvania.
Plaintiffs purportedly represent the interests of certain
customers in Pennsylvania who entered into the agreement or a
certain product in Pennsylvania.
The complaint seeks monetary damages, attorney fees and costs
and a declaration that the customers may terminate their
agreement with the company.
In response to Strategic Energy's preliminary objections,
plaintiffs have filed an amended complaint that management is
evaluating.
Plaintiffs have granted Strategic Energy an indefinite extension
of time to answer the complaint, according to the company's Nov.
7, 2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended Sept. 30, 2006.
Kansas City, Missouri-based Great Plains Energy, Inc., (NYSE:
GXP) -- http://www.greatplainsenergy.com/-- is a public utility
holding company and does not own or operate any significant
assets other than the stock of its subsidiaries. Great Plains
Energy has four direct subsidiaries with operations: Kansas City
Power & Light Co., KLT Inc., Innovative Energy Consultants,
Inc., and Great Plains Energy Services, Inc. KCP&L's sole
reportable business segment is KCP&L. Strategic Energy, L.L.C.
is the subsidiary of KLT Energy Services. Great Plains Energy,
through its direct and indirect subsidiaries, has two business
segments: KCP&L and Strategic Energy.
TETRA TECH: Faces Suit Over Back-Dated Stock Option Grants
----------------------------------------------------------
The law firm of Stull, Stull & Brody announces that a
shareholder lawsuit has been commenced against certain members
of the board of directors and certain executive officers of
Tetra Tech, Inc.
The complaint alleges that certain current and prior officers
and directors manipulated the prices of executive and director
stock option grants (a.k.a. back-dated stock options).
Such practice of awarding stock options to executives and
directors at artificially low prices is alleged to violate the
company's internal documents (such as the company's stock option
plan), as well as state laws governing officer and director
fiduciary duties and/or federal laws governing securities and
taxation.
In addition, the practice results in lower payments to
companies, results in those companies under-reporting
compensation expenses, and permits directors, officers and/or
executives to unjustifiably reap millions and billions of
dollars which should be disgorged and returned to the corporate
coffers thereby contributing to the financial health of the
company.
For more details, contact Tzivia Brody, Esq. of Stull, Stull &
Brody, Phone: 1-800-337-4983, Fax: 212-490-2022, E-mail:
ssbny@aol.com, Web site: http://www.ssbny.com.
UNUMPROVIDENT CORP: Hearing to Certify Antitrust Suit Set Jan.
--------------------------------------------------------------
A January 9, 2007 hearing is set for a motion to certify the
Insurance Brokerage Antitrust Litigation, which names
Unumprovident Corp. and certain of its subsidiaries, along with
many other insurance brokers and insurers as defendants.
A series of putative class actions under the antitrust suit have
been transferred to the U.S. District Court for the District of
New Jersey for coordinated or consolidated pre-trial proceedings
as part of multidistrict litigation (MDL) No. 1663, "In re
Insurance Brokerage Antitrust Litigation."
The plaintiffs in MDL No. 1663 filed a consolidated amended
complaint in August 2005, which alleges, among other things,
that the defendants violated federal and state antitrust laws,
Racketeer Influenced and Corrupt Organizations Act, Employee
Retirement Income Security Act, and various state common law
requirements by engaging in alleged bid rigging and customer
allocation and by paying undisclosed compensation to insurance
brokers to steer business to defendant insurers.
Defendants filed a motion to dismiss the complaint on Nov. 29,
2005. Oral argument on the motion to dismiss was held on July
26, 2006. On Oct. 3, 2006 the court ordered plaintiffs to
replead their Sherman Act and RICO claims.
The court denied defendants motion to dismiss the ERISA claims,
while setting an expedited schedule for completion of discovery
and noting that these claims were more appropriately addressed
on summary judgment.
Finally, the court held in abeyance the motion to dismiss the
state law claims pending final resolution of the motions to
dismiss the federal claims.
Plaintiffs filed a motion for class certification on Feb. 13,
2006, and defendants filed an opposition. The motion for class
certification is fully briefed and pending. The class
certification hearing is currently scheduled for Jan. 9, 2007.
The suit is "In re Insurance Brokerage Antitrust Litigation, MDL
No. 1663," filed in the U.S. District Court for the District of
New Jersey under Judge Faith S. Hochberg with referral to Judge
Patty Shwartz.
Representing the plaintiff are:
(1) Thomas M. Louis of Wells Marble & Hurst, PLLC, P.O. BOX
131, Jackson, MS 39205-0131, Phone: (601) 355-8321, E-
mail: tlouis@wellsmar.com;
(2) H. Alan Mccall of Stockwell Sievert, P.O. Box 2900,
Lake Charles, LA 70601, US, Phone: 337-436-9491;
(3) Ellen Meriwether of Miller Faucher & Cafferty, LLP, One
Logan Square, Suite 1700, 18TH & Cherry Streets,
Philadelphia, PA 19103, Phone: 215-864-2800, E-mail:
emeriwether@millerfaucher.com; and
(4) Douglas A. Millen, Counsel Not Admitted to USDC-NJ Bar
Much, Shelist, Freed, Denenberg, Ament & Rubenstein,
PC, 191 N. Wacker Drive, Suite 1800, Chicago, IL 60605-
1615, Phone: (312) 521-2100.
Representing the defendants are, Steven Paul Del Mauro of
Mcelroy Deutsch Mulvaney & Carpenter, 1300 mt. Kemble avenue,
P.O. BOX 2075, Morristown, NJ 07962-2075, Phone: (973) 993-8100,
Fax: (973) 425-0161, E-mail: sdelmauro@mdmc-law.com; and Deborah
E. HYRB, Counsel Not Admitted to USDC-NJ Bar, Paul Hastings,
Janofsky & Walker, LLP, 1055 Washington Boulevard, 9th Floor
Stamford, CT 06901, US, Phone: (203) 961-7400.
VIENNA BEEF: Faces Cook County Lawsuit Over Mislabeled Hotdogs
---------------------------------------------------------------
Three Cook County residents have filed a lawsuit in Cook County
Circuit Court against Vienna Beef alleging that the company
mislabeled hot dogs as "pure beef" when the products had a pork
casing, Michael Higgins of The Chicago Tribune reports.
According to the lawsuit, each of the Jewish the plaintiffs --
Morris Gershengorin, Marina Smolyansky and Marina Bartashnik --
suffered emotional distress after learning they had ingested the
pork-intestine casing. The suit describes each of the
plaintiffs as "an observant Jew."
The lawsuit further alleges that Vienna's advertising does not
claim the hot dogs are kosher but does use terms such as "all-
beef hot dogs" and "pure beef franks."
Plaintiffs are seeking to bring the suit as a class action on
behalf of others who have eaten the hot dogs and unspecified
damages.
Vienna Beef spokeswoman Susan Stoga said 96 percent of the
company's hot dogs are either skinless or use a non-pork casing.
She added that the products that use a pork casing are the
larger hot dogs, such as foot longs. She said those products are
available at some chain restaurants.
According to plaintiffs' lawyer Lance Raphael of Chicago,
plaintiffs hope the suit forces Vienna Beef to change its
advertising.
"I would like to let people know what is in something and make
decisions for themselves," Mr. Raphael said.
Company officials have not yet reviewed the suit but stand
behind their labeling, Ms. Stoga said.
Plaintiffs' lawyer is Lance Raphael of The Consumer Advocacy
Center, P.C., 180 West Washington, Suite 700, Chicago, IL 60602,
Phone: (312) 782-5808 or (312) 656-4262 (Direct Dial), Fax:
(312) 377-9930.
WASHINGTON: Bellevue Resident Sues Seattle Over Parking Tickets
---------------------------------------------------------------
The City of Seattle, Washington faces a purported class action
in King County Superior Court over its issuance of parking
tickets and collecting money from parking meters the day before
and the day after holidays, Sharon Pian Chan of The Seattle
Times reports.
Colette Turner of Bellevue filed the $700,000 class action on
Nov. 21, 2006. In it, Ms. Turner claims that she was ticketed
in Seattle on Dec. 31, 2004, even though according to city law,
she should have been allowed to park free that New Year's Eve
day.
Dewelle Ellsworth, Ms. Turner's attorney stated that they are
going to try to get the city to:
-- refund the money it made from the parking-meter
revenue,
-- reimburse people for the parking tickets they were
forced to pay, and
-- reimburse them for any towing fees.
According to the law at the time, people could park free on city
streets the day after Thanksgiving, the Friday before a holiday
that fell on a Saturday, and the Monday after a holiday that
fell on a Sunday.
Mr. Ellsworth said pointed out that meters and signs did not
list those days as free even though they were, and the city
issued tickets.
Though he does not know how many tickets were issued those days,
Mr. Ellsworth explained that he calculated the $700,000 based on
average ticket and meter revenues.
Earlier this year, Ms. Turner filed a lawsuit over the practice,
however she later withdrew. She later re-filed the current
lawsuit in King County Superior Court, claiming that the city
had collected parking revenue on at least eight days when
parking should have been free:
-- Nov. 28, 2003;
-- July 5, Nov. 26,
-- Dec. 24, 2004,
-- Dec. 31, 2004;
-- Nov. 25, 2005,
-- Dec. 26, 2005; and
-- Jan. 2, 2006.
For more details, contact Dewelle Ellsworth, P.O. Box 31743,
Seattle, WA 98103, Phone: 206-351-2525.
WESTMORELAND COAL: Faces Litigation in Miss. Over CO2 Emissions
---------------------------------------------------------------
Westmoreland Coal Co. is a defendant in a purported class action
in the U.S. District Court for the Southern District of
Mississippi over carbon dioxide (CO2) emission.
On April 26, 2006, the company learned that it was named as a
defendant in the class action complaint, "Comer, et al. v.
Nationwide Mutual Insurance Co., et al., Case No. 1:05-cv-00436-
LTS-RHW."
The suit, filed on Sept. 20, 2005, has 14 named individuals as
plaintiffs who filed the complaint on behalf of themselves and
all others similarly situated. Defendants are:
-- 7 large oil companies;
-- the American Petroleum Institute;
-- 1 to 100 unnamed oil and refining companies;
-- 21 power generation companies; and
-- 10 coal mining and/or coal leasing companies, including
the company.
With respect to the coal companies, the complaint alleges that
defendants produced hydrocarbons that, when used in the
production of electricity, caused the emission of "greenhouse
gases", which allegedly caused global warming, which allegedly
caused, or added to, the destructiveness of Hurricane Katrina,
which allegedly caused damage to the plaintiffs.
Plaintiffs are seeking compensatory and punitive damages as well
as expenses and legal costs, according to its Nov. 6, 2006 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the period ended June 30, 2006.
The suit is "Comer, et al. v. Nationwide Mutual Insurance Co.,
et al., Case No. 1:05-cv-00436-LTS-RHW," filed in the U.S.
District Court for the Southern District of Mississippi under
Judge L. T. Senter, Jr. with referral to Judge Robert H. Walker.
Representing the plaintiffs are:
(1) Carlos A. Zelaya of Maples & Kirwan, LLC, 902 Julia
Street, New Orleans, LA 70113, US, Phone: 504/569-8732,
Fax: 504/525-6932;
(2) Stephen M. Wiles and Randall Allan Smith of Smith &
Fawer, 201 St. Charles Ave., Suite 3702, New Orleans,
LA 70170, Phone: 504/525-2200, Fax: 504/525-2205, E-
mail: smwiles@smithfawer.com and
rasmith3@bellsouth.net; and
(3) F. Gerald Maples F. Gerald Maples, PA, 902 Julia
Street, New Orleans, LA 70113, Phone: 504/569-8732, E-
mail: federal@geraldmaples.com.
Representing the company is Crowell & Moring, LLP, 1001
Pennsylvania Avenue, N.W. Washington, DC 20004-2595, Phone:
202/624-2500, Fax: 202/628-5116, Web site:
http://www.crowell.com.
Asbestos Alert
ASBESTOS LITIGATION: Claims v. Albany Int'l. Decrease to 19,283
----------------------------------------------------------------
Albany International Corp., as of Oct. 27, 2006, was faced with
19,283 asbestos-related claims, down from 20,246 claims as of
Aug. 4, 2006, and 24,451 claims as of Dec. 31, 2005.
These lawsuits alleged that plaintiffs have suffered personal
injury from exposure to asbestos-containing products previously
made by the Company.
Pleadings and discovery responses in those cases, in which work
histories have been provided, indicate claimants with paper mill
exposure in less than 10 percent of total claims reported. A
portion of those claimants has alleged time spent in a paper
mill to which the Company is believed to have supplied asbestos-
containing products.
As of Oct. 27, 2006, about 12,735 of the claims pending against
the Company are pending in Mississippi State or Federal courts.
As of Oct. 27, 2006, about 12,043 of the claims against the
Company pending in Mississippi are in Federal court, at the
multi-district litigation panel, either through removal or
original jurisdiction.
Liberty Mutual, the Company's insurer, has defended each case
and funded settlements under a standard reservation of rights.
As of Oct. 27, 2006, the Company had resolved, through
settlement or dismissal, 20,761 claims, in which the Company
spent US$6,691,000. Of this amount, US$6,656,000, or 99 percent,
was paid by the Company's insurance carrier.
The Company has about US$130 million in confirmed insurance
coverage that should be available with respect to current and
future asbestos claims, as well as more insurance coverage that
it should be able to access.
Headquartered in Albany, N.Y., Albany International Corp. makes
paper machine clothing, which are custom-made fabric belts that
move paper stock through each phase of production. The Company
makes around 35 percent of the monofilament yarn used in its
paper machine clothing and relies on suppliers for the rest.
ASBESTOS LITIGATION: Brandon Drying Records 8,992 Injury Claims
----------------------------------------------------------------
Albany International Corp.'s affiliate, Brandon Drying Fabrics
Inc., defended against 8,992 asbestos-related claims as of Oct.
27, 2006, down from 9,399 claims as of Aug. 4, 2006, and 9,566
claims as of Dec. 31, 2005.
Brandon, a wholly owned Geschmay Corp. subsidiary, is a separate
defendant in many of the asbestos cases in which the Company is
named as a defendant.
In 1999, the Company acquired Geschmay, formerly known as
Wangner Systems Corp. In 1978, Brandon acquired certain assets
from Abney Mills, a South Carolina textile maker. Among the
assets acquired by Brandon from Abney were assets of Abney's
wholly owned subsidiary, Brandon Sales Inc., which had sold
dryer fabrics with asbestos made by its parent, Abney.
Under the terms of the Assets Purchase Agreement between Brandon
and Abney, Abney agreed to indemnify, defend, and hold Brandon
harmless from any actions or claims on account of products made
by Abney and its related corporations prior to the date of the
sale, whether or not the product was sold subsequent to the date
of the sale.
As of Oct. 27, 2006, Brandon has resolved, by settlement or
dismissal, 8,362 claims for a total of US$152,499.
Brandon's insurance carriers initially agreed to pay 88.2
percent of the total indemnification and defense costs related
to these proceedings. The remaining 11.8 percent of the costs
had been borne directly by Brandon.
Headquartered in Albany, N.Y., Albany International Corp. makes
paper machine clothing, which are custom-made fabric belts that
move paper stock through each phase of production. The Company
makes around 35 percent of the monofilament yarn used in its
paper machine clothing and relies on suppliers for the rest.
ASBESTOS LITIGATION: Essex Still Has Product Liability Lawsuits
----------------------------------------------------------------
Superior Essex Inc. said that, since about 1990, Essex
International Inc. and certain subsidiaries defend in asbestos-
related product liability lawsuits.
Essex International is a subsidiary of Superior Essex Holding
Corp., which is a subsidiary of Superior Essex Inc.
The suits were filed by electricians, other skilled tradesmen
and others claiming injury, in most cases, from exposure to
asbestos found in electrical wire products.
Litigation against various past insurers of Essex International,
in which the insurers had previously refused to defend and
indemnify Essex International against these suits, was settled
in 1999.
Under the settlement, Essex International was reimbursed for
most of its costs and expenses incurred in the defense of these
suits. The insurers have also undertaken to defend, are
currently defending and, will indemnify Essex International
against those asbestos suits.
Under Superior TeleCom Inc.'s plan of reorganization, certain of
the claimants in these actions will be able to assert claims
under applicable insurance coverage and other arrangements.
Headquartered in Atlanta, Ga., Superior Essex Inc., which was
formerly known as Superior TeleCom, makes communications wire
and cable and magnet wire. Its products can be found in
transformers, generators, and electrical controls.
ASBESTOS LITIGATION: Grace Records 65,656 Suits Since April 2001
----------------------------------------------------------------
W.R. Grace & Co., as of its April 2, 2001 bankruptcy filing
date, was a defendant in 65,656 asbestos-related lawsuits,
according to the Company's quarterly report, on Form 10-Q, for
the period ended Sept. 30, 2006 filed with the U.S. Securities
and Exchange Commission.
The Company faces property damage and personal injury suits
relating to previously sold asbestos-containing products.
Of the 65,656 suits, 17 involved claims for property damage (one
of which has since been dismissed), and the rest involved
129,191 personal injury claims.
Due to the filing, holders of asbestos-related claims are stayed
from continuing to prosecute pending litigation and from
commencing new suits against the Debtors.
Separate creditors' committees representing the interests of
property damage and personal injury claimants, and a legal
representative of future personal injury claimants, have been
appointed in the Chapter 11 Cases.
The Company's obligations with respect to present and future
claims will be determined through the Ch. 11 process.
Headquartered in Columbia, Md., W.R. Grace & Co. has
restructured from six product groups into two major units.
Grace's Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: W.R. Grace Faces 640 Property Damage Claims
----------------------------------------------------------------
W.R. Grace & Co., as of Oct. 31, 2006, had about 640 outstanding
asbestos-related property damage claims, after reclassification,
withdrawal, or expungement of claims.
As of July 31, 2006, the Company had about 850 outstanding
property damage claims, following reclassification, withdrawal,
or expungement of claims. (Class Action Reporter, Aug. 25, 2006)
Plaintiffs in asbestos property damage lawsuits seek to have the
defendants pay for the cost of removing, containing or repairing
the asbestos-containing materials in the affected buildings.
Out of 380 asbestos property damage cases filed before the April
2, 2001 bankruptcy filing date, 140 were dismissed without
payment of any damages or settlement amounts. Judgments after
trial were entered in favor of Grace in nine cases, excluding
cases settled following appeals of judgments in favor of Grace.
Judgments after trial were entered in favor of the plaintiffs in
eight cases, one of which is on appeal, for a total of US$86.1
million, 207 property damage cases were settled for a total of
US$696.8 million, and 16 cases remain outstanding, including the
one on appeal.
Of the 16 remaining asbestos-related property damage cases,
eight related to the Company's former Zonolite Attic Insulation
product and eight related to a number of former asbestos-
containing products, two of which also are alleged to involve
ZAI.
About 4,300 more property damage claims were filed before the
March 31, 2003 claims bar date established by the U.S.
Bankruptcy Court.
Eight of the ZAI cases were filed as purported class action
suits in 2000 and 2001. Moreover, 10 suits were filed as
purported class actions in 2004 and 2005 with respect to persons
and homes in Canada.
Headquartered in Columbia, Md., W.R. Grace & Co. has
restructured from six product groups into two major units.
Grace's Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: Grace Faces 129,191 Personal Injury Claims
----------------------------------------------------------------
W.R. Grace and Co., as of its April 2, 2001 bankruptcy filing
date, had 129,191 claims for personal injury pending against it,
according to the Company's quarterly report, on Form 10-Q, for
the period ended Sept. 30, 2006 filed with the U.S. Securities
and Exchange Commission.
Personal injury claimants alleged adverse health effects from
exposure to asbestos-containing products formerly made by the
Company.
Cumulatively through the filing date, 16,354 asbestos personal
injury lawsuits involving about 35,720 claims were dismissed
without payment of any damages or settlement amounts. About
55,489 lawsuits involving about 163,698 claims were disposed of
for a total of US$645.6 million.
Headquartered in Columbia, Md., W.R. Grace & Co. has
restructured from six product groups into two major units.
Grace's Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: Grace Notes $959M Coverage from 54 Insurers
----------------------------------------------------------------
W.R. Grace & Co., as of Sept. 30, 2006, had about US$959 million
of asbestos-related excess coverage from about 54 presently
solvent insurers, according to the Company's quarterly report,
on Form 10-Q, for the period ended Sept. 30 2006 filed with the
U.S. Securities and Exchange Commission.
The Company had previously bought insurance policies that
provided coverage from 1962 to 1985 with respect to asbestos-
related lawsuits and claims.
Presently, the Company has no agreements in place with insurers
with respect to about US$483 million of excess coverage, which
is at layers of coverage that have not yet been triggered.
However, certain layers would be triggered if the Company's plan
of reorganization were approved at the recorded asbestos-related
liability of US$1.7 billion.
In addition to about US$959 million of excess coverage with
solvent insurers, the Company has about US$318 million of excess
coverage with insolvent or non-paying insurance carriers.
Headquartered in Columbia, Md., W.R. Grace & Co. has
restructured from six product groups into two major units.
Grace's Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: Grace Estimates $255.7M for Cleanup in 3Q06
----------------------------------------------------------------
W.R. Grace & Co., at Sept. 30, 2006, estimated US$255.7 million
for vermiculite-related remediation, compared with US$226.2
million at Dec. 31, 2005.
The liability included the cost of remediation of vermiculite
processing sites outside of Libby, Mont.
The Sept. 30, 2006 estimate included US$164.4 million for
asserted reimbursable costs through 2005, including the charge
taken in the 2006-2nd quarter.
The US$255.7 million estimate does not include the cost to
remediate the Company-owned mine site at Libby, Mont. or other
nearby properties that may require remediation.
In November 1999, Region 8 of the U.S. Environmental Protection
Agency investigated into alleged excessive levels of asbestos-
related disease in the Libby population related to Grace's
former mining activities in Libby.
On March 30, 2001, the U.S. sued the Company in the U.S.
District Court for the District of Montana, Missoula Division
(United States v. W. R. Grace & Co. et al.) under the
Comprehensive Environmental Response, Compensation and Liability
Act.
The suit sought recovery of costs allegedly incurred by the
United States in response to the release or threatened release
of asbestos in the Libby area relating to such former mining
activities. The U.S. EPA also sought a declaration of the
Company's liability that would be binding in future actions to
recover further response costs.
In December 2002, the District Court granted the United States'
motion for partial summary judgment on a number of issues that
limited the Company's ability to challenge the U.S. EPA's
response actions.
In January 2003, a trial was held on the remaining issues, which
involved the reasonableness and adequacy of documentation of the
U.S. EPA's cost recovery claims through Dec. 31, 2001.
On Aug. 28, 2003, the District Court issued a ruling in favor of
the United States that requires the Company to reimburse the
U.S. Govt. for US$54.5 million, plus interest, in costs expended
through December 2001, and for all appropriate future costs to
complete the remediation activities.
The Ninth Circuit Court of Appeals upheld the District Court's
rulings. The Company's petition for the U.S. Supreme Court to
hear the case was denied.
Headquartered in Columbia, Md., W.R. Grace & Co. has
restructured from six product groups into two major units.
Grace's Davison Chemicals unit makes silica-based products,
chemical catalysts, and refining catalysts that help produce
refined products from crude oil. Its Performance Chemicals unit
makes concrete and cement additives, packaging sealants, and
fireproofing chemicals.
ASBESTOS LITIGATION: Ampco-Pittsburgh Has 12,230 Claims in 3Q06
----------------------------------------------------------------
Ampco-Pittsburgh Corp., for the nine months ended Sept. 30,
2006, recorded about 15,230 open asbestos-related claims,
according to the Company's quarterly report, on Form 10-Q, for
the period ended Sept. 30, 2006 filed with the U.S. Securities
Exchange Commission.
For the nine months ended Sept. 30, 2006, the Company had about
1,863 asbestos claims settled or dismissed for US$8,502,000.
For the six months ended June 30, 2006, the Company had about
14,900 open asbestos-related claims, compared with about 16,700
claims for the three months ended March 31, 2006. (Class Action
Reporter, Sept. 8, 2006)
Several Company subsidiaries face claims alleging personal
injury from exposure to asbestos-containing components
historically used in some of the subsidiary's products. Those
subsidiaries, and in some cases the Company, co-defend in cases
filed in various state and federal courts.
Certain Company subsidiaries and the Company have an arrangement
with insurers responsible for its historical primary and some
umbrella insurance coverage for Asbestos Liability. Under the
Coverage Arrangement, the Paying Insurers accept financial
responsibility for most of the Asbestos Liabilities.
The Coverage Arrangement includes an acknowledgement that Howden
Buffalo Inc. is entitled to coverage under policies covering
Asbestos Liability arising out of the historical products made
or distributed by Buffalo Forge, a former Company subsidiary.
The Company incurred uninsured legal costs related with advice
on certain matters pertaining to these asbestos cases including
insurance litigation, case management and other issues. Those
costs amounted to about US$356,000,000 for the nine months ended
Sept. 30, 2006 and US$53,000,000 for the three months ended
Sept. 30, 2006.
The Company incurred uninsured legal costs of US$762,000,000 for
the nine months ended Sept. 30, 2006 and US$332,000,000 for the
three months ended Sept. 30, 2005.
Headquartered in Pittsburgh, Pa., Ampco-Pittsburgh Corp. makes
metal products. Its forged steel rolls unit makes forged
hardened-steel rolls for the steel and aluminum industries. The
air and liquid processing segment makes centrifugal pumps for
refrigeration and power generation, finned-tube heat-exchange
coils, and air-handling systems.
ASBESTOS LITIGATION: General Cable Corp. Deals With 40.4T Claims
----------------------------------------------------------------
General Cable Corp., at Sept. 29, 2006, is faced with about
40,432 outstanding asbestos-related claims, in which about 7,142
were non-maritime claims and 33,290 were maritime claims.
At June 30, 2006, the Company had about 40,850 outstanding
asbestos-related claims, of which about 7,550 were non-maritime
claims and 33,300 were maritime claims. (Class Action Reporter,
Sept. 1, 2006)
Company subsidiaries have been named as defendants in lawsuits
alleging exposure to asbestos in products made by the Company.
At Sept. 29, 2006, the Company had accrued, on a gross basis,
about US$5.2 million for these suits, compared with about US$5.6
million at Dec. 31, 2005.
At Sept. 29, 2006, the Company had recorded insurance recoveries
of about $500,000 related to asbestos suits, compared with
US$3.1 million at Dec. 31, 2005.
During 2006, the recorded insurance recoveries decreased mainly
due to the US$3 million cash settlement for the resolution of an
insurer's obligations for coverage of asbestos liabilities under
a series of insurance policies issued to the Company that
effectively removed the insurance company's responsibilities,
thus reducing the expected insurance recoveries balance.
Headquartered in Highland Heights, Ky., General Cable Corp.
makes aluminum, copper, and fiber-optic wire and cable products.
General Cable has three segments: industrial and specialty,
energy, and communications.
ASBESTOS LITIGATION: MetLife Inc. Receives 6,384 Claims in 3Q06
----------------------------------------------------------------
Metropolitan Life Insurance Co., a MetLife Inc. subsidiary,
during the nine months ended Sept. 30, 2006, received about
6,384 asbestos-related claims compared with about 12,100 claims
for the same period in 2005.
During the six months ended June 30, 2006, Metropolitan Life
received about 3,886 asbestos-related claims, compared with
9,110 claims during the same period in 2005. (Class Action
Reporter, Aug. 25, 2006)
In 2005, Metropolitan Life received about 18,500 asbestos-
related claims.
Metropolitan Life defends in lawsuits seeking compensatory and
punitive damages for personal injuries allegedly caused by
exposure to asbestos or asbestos-containing products. These
suits have been based on claims relating to certain research,
publication and other activities of one or more of Metropolitan
Life's employees from the 1920s through about the 1950s.
The suits have alleged that Metropolitan Life learned or should
have learned of certain health risks posed by asbestos and
improperly publicized or failed to disclose those risks.
In 1998, Metropolitan Life paid US$878 million in premiums for
excess insurance policies for asbestos claims. The excess
insurance policies for asbestos claims provided for recovery of
losses up to US$1.5 billion, which is in excess of a US$400
million self-insured retention.
It is possible that loss reimbursements to the Company and the
recoverable with respect to later periods may be less than the
amount of the recorded losses. Those foregone loss
reimbursements may be recovered upon commutation depending upon
future performance of the reference fund.
The foregone loss reimbursements, estimated as of Sept. 30,
2006, were about US$73.5 million in the aggregate, including
future years.
Headquartered in New York City, MetLife Inc.'s Institutional
segment offers group benefits products like insurance,
retirement products, and prepaid legal plans. Its Individual
segment offers consumers many of the same types of products and
its International segment offers the same to groups and
individuals in the Asia-Pacific region, Europe, and Latin
America.
ASBESTOS LITIGATION: Foster Wheeler Has $411.7M Liability in 3Q
----------------------------------------------------------------
Foster Wheeler Ltd., as of Sept. 29, 2006, recorded a total of
US$411,759,000 non-current asbestos-related liability, compared
with US$466,163,000 as of Dec. 30, 2005.
As of June 30, 2006, the Company's total non-current asbestos-
related liability was US$435,023,000, compared with
US$466,163,000 as of Dec. 31, 2005. (Class Action Reporter,
Sept. 8, 2006)
As of Sept. 29, 2006, the Company's non-current asbestos-related
insurance recovery receivable was US$341,555,000, compared with
US$321,008,000 as of Dec. 30, 2005.
As of June 30, 2006, the Company's total non-current asbestos-
related insurance recovery receivable was US$382,227,000,
compared with US$321,008,000 as of Dec. 31, 2005. (Class Action
Reporter, Sept. 8, 2006)
In the 2006-3rd quarter, the Company's subsidiaries agreed with
three insurers to settle disputed asbestos-related coverage. As
a result of these settlements, the Company recorded a US$16.6
million gain, increased its insurance asset by US$4 million and
received cash of US$12.6 million.
Moreover, in the 2006-3rd quarter, the Company's subsidiaries
were successful in their appeal of the trial court decision
regarding the state law applicable in their asbestos insurance
coverage litigation. As a result, the Company further increased
its insurance asset and recorded a gain of US$19.5 million.
During the first nine months of 2006, the Company has funded
US$30.2 million of asbestos liability indemnity payments and
defense costs from its cash flow, net of the cash received from
insurance settlements. The Company expects net positive cash
inflows of about US$38 million in the 2006-4th quarter from its
asbestos management program.
For 2006, the Company forecasts a net cash inflow of about
US$7.8 million from its asbestos management program.
For the three months ended Sept. 29, 2006, the Company recorded
US$36,704,000 net gains on asbestos. For the nine months ended
Sept. 29, 2006, the Company recorded US$115,664,000 net gains on
asbestos.
Headquartered in Clinton, N.J., Foster Wheeler Ltd. operates
through two business groups. The Engineering & Construction
group designs and builds facilities for the oil and gas,
chemical, pharmaceutical, and other industrial markets. The
Company's Power Products & Services unit makes steam-generating
units and related equipment for power and industrial plants.
ASBESTOS LITIGATION: Foster Wheeler Has 150.8T U.S. Claims in 3Q
----------------------------------------------------------------
Subsidiaries of Foster Wheeler Ltd. in the United States, for
the three months ended Sept. 29, 2006, recorded 150,800 open
asbestos-related claims, compared with 165,910 open claims for
the three months ended Sept. 30, 2005.
Several Company subsidiaries in the U.S. and the U.K. defend in
asbestos-related lawsuits and out-of-court informal claims.
Plaintiffs claim damages for personal injury allegedly from
exposure to or use of asbestos in connection with work performed
by Company subsidiaries in the 1970s and earlier.
For the three months ended Sept. 29, 2006, the Company recorded
2,030 new claims, compared with 3,930 new claims for the three
months ended Sept. 30, 2005. For the three months ended Sept.
29, 2006, the Company resolved 12,670 claims, compared with
3,920 claims for the three months ended Sept. 30, 2005.
New claims for 2006 included 320 claims originally filed and
closed in prior years that were re-opened in 2006. Claims
resolved included court dismissals without payment of a mass
claim filing of about 5,260 claims.
As of Sept. 29, 2006, the Company's total-asbestos-related
liabilities in the U.S. was US$455,100,000, compared with
US$516,000,000 as of Dec. 30, 2005.
The Company's total asbestos-related assets in the U.S., as of
Sept. 29, 2006, were US$405,100,000, compared with
US$320,000,000 as of Dec. 30, 2005.
For the three months ended Sept. 29, 2006, the Company spent
US$23,300,000 on asbestos litigation, defense, and case
resolution, compared with US$19,800,000 for the three months
ended Sept. 30, 2005.
The Company funded US$30,200,000 of the payments made during the
nine months ended Sept. 29, 2006, while all remaining amounts
were paid from insurance proceeds.
For the nine months ended Sept. 29, 2006, the Company spent
US$60,900,000 on asbestos litigation, defense, and case
resolution, compared with US$64,600,000 for the nine months
ended Sept. 30, 2005.
Through Sept. 29, 2006, total cumulative indemnity costs paid
were about US$553,100,000 and total cumulative defense costs
paid were about US$155,200,000.
As of Sept. 29, 2006, total asbestos-related liabilities were
comprised of an estimated liability of US$162,800,000 relating
to open claims being valued and an estimated liability of
US$292,300,000 relating to future unasserted claims through
year-end 2020.
As of Sept. 29, 2006, the Company estimated the value of its
asbestos insurance asset contested by its subsidiaries' insurers
in ongoing litigation as US$29,500,000.
Headquartered in Clinton, N.J., Foster Wheeler Ltd. operates
through two business groups. The Engineering & Construction
group designs and builds facilities for the oil and gas,
chemical, pharmaceutical, and other industrial markets. The
Company's Power Products & Services unit makes steam-generating
units and related equipment for power and industrial plants.
ASBESTOS LITIGATION: Foster Wheeler Has 334 U.K. Claims in 3Q06
---------------------------------------------------------------
Foster Wheeler Ltd., as of Sept. 29, 2006, recorded 814 open
asbestos-related claims against its subsidiaries in the United
Kingdom, according to the Company's quarterly report, on Form
10-Q, for the period ended Sept. 29, 2006 filed with the U.S.
Securities and Exchange Commission.
Several Company subsidiaries in the U.K. have received claims
alleging personal injury arising from exposure to asbestos. To
date, 814 claims have been filed against the Company's U.K.
subsidiaries.
As of June 30, 2006, the Company's subsidiaries in the U.K.
recorded 329 open asbestos-related claims. To date, 800 claims
have been filed against the Company's U.K. subsidiaries. (Class
Action Reporter, Sept. 8, 2006)
As of Sept. 29, 2006, the Company had recorded total liabilities
of US$27,800,000 comprised of an estimated liability relating to
open claims of US$2,700,000 and an estimated liability relating
to future unasserted claims through year-end 2020 of
US$25,100,000. Of the total, US$1,100,000 was recorded in
accrued expenses and US$26,700,000 was recorded in asbestos-
related liability.
An asset in an equal amount was recorded for the expected U.K.
asbestos-related insurance recoveries, of which US$1,100,000 was
recorded in accounts and notes receivable and US$26,700 was
recorded as asbestos-related insurance recovery receivable.
The liability and asset estimates are based on a U.K. court of
appeal ruling that pleural plaque claims do not amount to a
compensable injury and accordingly, the Company has reduced its
liability assessment. If the ruling would be reversed, the
asbestos liability and asset recorded in the U.K. would be about
US$66,200,000.
Headquartered in Clinton, N.J., Foster Wheeler Ltd. operates
through two business groups. The Engineering & Construction
group designs and builds facilities for the oil and gas,
chemical, pharmaceutical, and other industrial markets. The
Company's Power Products & Services unit makes steam-generating
units and related equipment for power and industrial plants.
ASBESTOS LITIGATION: Chubb Corp. Has $1.038B Loss Reserves in 3Q
----------------------------------------------------------------
The Chubb Corp.'s gross loss reserves, as of Sept. 30, 2006,
which are related to asbestos and toxic waste claims, were
US$1.038 billion, compared with US$1.121 billion as of Dec. 31,
2005.
As of June 30, 2006, the Company's gross loss reserves, which
are related to asbestos and toxic waste claims, were US$1.059
billion. (Class Action Reporter, Sept. 1, 2006)
The Company's net loss reserves related to asbestos and toxic
waste claims, as of Sept. 30, 2006, was US$990 million, compared
with US$1.071 billion as of Dec. 31, 2005.
As of June 30, 2006, the Company's net loss reserves, which are
related to asbestos and toxic waste claims, were US$1.010
billion. (Class Action Reporter, Sept. 1, 2006)
As of Sept. 30, 2006, the Company's reinsurance recoverable
related to asbestos and toxic waste claims was US$48 million,
compared with US$50 million.
Headquartered in Warren, N.J., The Chubb Corp. is known for
comprehensive homeowners insurance for yacht owners. Chubb also
offers property-casualty insurance to companies. The Company's
specialty commercial insurance includes the lucrative executive
risk business that offers professional liability policies to
executives.
ASBESTOS LITIGATION: ACE Ltd. Reserves $3.050B for Claims in 3Q
---------------------------------------------------------------
ACE Ltd., for the period ended Sept. 30, 2006, recorded US$3.050
billion gross consolidated loss and allocated loss expense
reserves for asbestos related exposures, excluding the provision
for uncollectible reinsurance.
For the period ended Sept. 30, 2006, the Company recorded
US$1.476 billion net consolidated loss and allocated loss
expense reserves for asbestos exposures, excluding the provision
for uncollectible reinsurance.
As of June 30, 2006, the Company recorded US$3.526 billion
gross, US$1.711 billion net, consolidated loss and allocated
loss expense reserve for asbestos-related exposure, excluding
the provision for uncollectible reinsurance. (Class Action
Reporter, Aug. 25, 2006)
The Company's asbestos and environmental liabilities related to
claims from bodily-injury claims related to asbestos products
and remediation costs associated with hazardous waste sites.
The Company's exposure to A&E claims arose out of liabilities
acquired when the Company bought Westchester Specialty in 1998
and CIGNA's P&C business in 1999.
In 1996, before the Company's acquisition of CIGNA's P&C
business, the Pa. Insurance Commissioner approved a plan to
restructure INA Financial Corp. and its subsidiaries, which
included the division of Insurance Co. of North America into two
separate corporations:
(1) An active insurance company that retained the INA name and
continued to write P&C business; and
(2) An inactive run-off company now called Century Indemnity Co.
As a result of the division, all A&E and certain other
liabilities of INA were allocated to Century and extinguished as
INAs.
As part of the Restructuring, the A&E liabilities of various
U.S. affiliates of INA were reinsured to Century, and Century
and certain other run-off companies having A&E and other
liabilities were contributed to Brandywine Holdings Corp. As
part of the 1999 acquisition of CIGNA's P&C business, the
Company acquired Brandywine Holdings and its various units.
Headquartered in Hamilton, Bermuda, ACE Ltd., through its
subsidiaries, sells property and casualty insurance and
reinsurance in the U.S. and about 50 other countries.
ASBESTOS LITIGATION: BNS Holding's Claims Remain at 234 in 3Q06
---------------------------------------------------------------
BNS Holding Inc., as of Oct. 31, 2006, recorded 234 known open
and active asbestos-related claims, according to the Company's
quarterly report, on Form 10-QSB, for the period ended Sept. 30,
2006 filed with the U.S. Securities and Exchange Commission.
As of July 31, 2006, the Company recorded 234 known asbestos-
related claims open and active. (Class Action Reporter, Sept.
15, 2006)
The Company's BNS Co. subsidiary receives claims for toxic tort
injuries related to the alleged use of asbestos in pumps sold by
its former pump division, and other product liability claims
linked to the use of machine tools sold by BNS Co. divisions,
which were sold years ago.
Most of these suits are toxic tort claims resulting from the use
of small internal seals that allegedly had asbestos and were
used in small fluid pumps made by BNS Co.'s former pump
division, which was sold in 1992.
In 1994, BNS Co. has been notified that it has been named as a
defendant in 662 known asbestos-related toxic-tort claims, as of
Oct. 31, 2006. In many cases, these claims involve more than 100
other defendants.
Before Dec. 31, 2001, 54 of those claims were filed. More claims
were filed in the following years: in 2002, 98 claims; in 2003,
194 claims; in 2004, 178 claims; and in 2005, 76 claims. As of
Oct. 31, 2006, 62 more claims were filed.
In 2002, 42 claims were dismissed or settled for an aggregate of
about US$30,000,000 exclusive of attorney's fees. In 2003, three
claims were granted summary judgment, and one claim was
dismissed and closed. In 2004, eight claims were granted summary
judgment and were closed, and 144 claims were dismissed, and
seven claims were settled for US$500,000 each.
In 2005, six claims were granted summary judgment and were
closed, 124 claims were dismissed and 6 were settled for
US$500,000 each. In October 2005, the Company and its insurers
settled two claims for an aggregate of US$150,000,000.
As of Oct. 15, 2006, six more claims were granted summary
judgment and were closed, five claims were settled for an
aggregate of US$2,600,000 and 84 more claims have been dismissed
or agreed to dismiss.
BNS Holding Co., which is based in Middletown, R.I., became a
holding company for BNS Co. in December 2004. BNS Co. was
engaged in the metrology business and the design, manufacture,
and sale of precision measuring tools and instruments, and
manual and computer controlled measuring machines. BNS Co. sold
its remaining assets in June 2004.
ASBESTOS LITIGATION: Old Republic Reserves $185M for A&E Claims
---------------------------------------------------------------
Old Republic International Corp., at Sept. 30, 2006, reserved
US$185.1 million gross, US$170.7 million net, for asbestos and
environmental claims, according to the Company's quarterly
report, on Form 10-Q, for the period ended Sept. 30, 2006 filed
with the U.S. Securities and Exchange Commission.
At June 30, 2006, the Company reserved US$169.8 million gross,
US$132.6 million net, for asbestos and environmental claims,
compared with US$170.7 million gross, US$132.2 million net, at
Dec. 31, 2005. (Class Action Reporter, Sept. 8, 2006)
Most of the Company's A&E claim reserves stem from its
participations, which were discontinued 15 or more years ago, in
assumed reinsurance treaties and insurance pools.
The overall A&E reserves the Company establishes respond to the
paid claim and case reserve activity reported to the Company as
well as available industry statistical data like survival
ratios.
The Company's average five-year survival ratios were 7.3 years,
gross, and 10.6 years, net of reinsurance, as of Sept. 30, 2006
and 7.4 years, gross, and 10.4 years, net of reinsurance, as of
Dec. 31, 2005.
Incurred net losses for A&E claims have averaged 3.3 percent of
General Insurance Group net incurred losses for the five years
ended Dec. 31, 2005.
Headquartered in Chicago, Ill., Old Republic International Corp.
is an insurance holding company operating in three areas: Old
Republic General Insurance offers general insurance including
commercial property and liability. The Company's Mortgage
Guaranty unit offers mortgage guaranty insurance. Its Title
Insurance Groups specialize in title insurance.
ASBESTOS LITIGATION: Cooper Ind. Records 31.4T Abex Claims in 3Q
----------------------------------------------------------------
Cooper Industries Ltd., at Sept. 30, 2006, recorded 31,488
Pneumo Abex Corp. asbestos-related claims that are the
responsibility of Federal-Mogul Corp., according to the
Company's quarterly report, on Form 10-Q, for the period ended
Sept. 30, 2006 filed with the U.S. Securities and Exchange
Commission.
From Aug. 28, 1998 through Sept. 30, 2006, a total of 140,813
Abex claims were filed, of which 109,325 claims have been
resolved. In the three months ended Sept. 30, 2006, 1,405 claims
were filed and 8,735 claims were resolved.
Since Aug. 28, 1998, the average indemnity payment for resolved
Abex Claims was US$1,965 before insurance. A total of US$100.7
million was spent on defense costs for Aug. 28, 1998 through
Sept. 30, 2006.
In October 1998, the Company sold its Automotive Products
business to Federal-Mogul. These discontinued businesses,
including the Abex product line from Pneumo Abex in 1994, were
operated through subsidiary firms, and the stock of those
subsidiaries was sold to Federal-Mogul under a Purchase and Sale
Agreement dated Aug. 17, 1998.
Federal-Mogul indemnified the Company for certain liabilities of
these subsidiary companies, including liabilities related to the
Abex product line and any potential liability that the Company
may have to Pneumo under a 1994 Mutual Guaranty Agreement
between the Company and Pneumo.
On Oct. 1, 2001, Federal-Mogul and several of its affiliates
filed a Ch. 11 bankruptcy petition and indicated that Federal-
Mogul may not honor the indemnification obligations to the
Company.
If Federal-Mogul rejects the 1998 Agreement, the Company will be
relieved of its future obligations under the 1998 Agreement.
Headquartered in Houston, Tex., Cooper Industries Ltd. makes
electrical products, tools, hardware, and metal support
products.
ASBESTOS LITIGATION: EnPro Ind. Records 112.5T Open Cases in 3Q
---------------------------------------------------------------
EnPro Industries Inc., at Sept. 30, 2006, recorded 112,500 open
asbestos-related cases, according to the Company's quarterly
report, on Form 10-Q, for the period ended Sept. 30, 2006 filed
with the U.S. Securities and Exchange Commission.
Of the open cases, the Company is aware of about 8,100, or 7.2
percent, that involve claimants alleging mesothelioma, lung
cancer or some other cancer.
Certain Company subsidiaries, mainly Garlock Sealing
Technologies LLC and The Anchor Packing Co., defend in actions
filed in various states by plaintiffs alleging injury or death
as a result of exposure to asbestos.
Since the first asbestos-related lawsuits were filed against
Garlock in 1975, Garlock and Anchor have processed more than
800,000 asbestos claims to conclusion and have paid more than
US$1.1 billion in settlements and judgments and over US$350
million in fees and expenses.
Of those claims resolved, about 3 percent have been claims of
plaintiffs alleging mesothelioma, about 6 percent have been
claims of plaintiffs with lung or other cancers, and more than
90 percent have been claims of plaintiffs alleging asbestosis,
pleural plaques or other non-malignant impairment of the
respiratory system.
In the first nine months of 2006, the Company recorded 6,100 new
filings, compared with 11,000 in the first nine months of 2005.
In the first nine months of 2006, Garlock began six trials
involving seven plaintiffs. In Philadelphia, three suits
involving four plaintiffs settled during trial before the juries
reached verdict. A suit in California and another case in
Dallas, Tex. also settled during trial.
In a retrial of a Kentucky case, the jury awarded the plaintiff
US$900,000 against Garlock. The award was significantly less
than the US$1.75 million award against Garlock in the previous
trial, which Garlock successfully appealed. Garlock has also
appealed the new verdict.
Moreover, Garlock obtained dismissals in two cases in
Philadelphia after the juries were selected but before the
trials began because there was insufficient evidence of exposure
to Garlock products.
Headquartered in Charlotte, N.C., EnPro Industries Inc. makes
engines, engineered products, and sealing systems. The Company
also makes heavy-duty, medium-speed diesel, and natural gas
engines.
ASBESTOS LITIGATION: CNA Financial Has $1.480B for Claims in 3Q
---------------------------------------------------------------
CNA Financial Corp. as of Sept. 30, 2006, carried about US$1.480
billion of claim and claim adjustment expense reserves, net of
reinsurance recoverables, for reported and unreported asbestos-
related claims, compared with US$1.554 billion as of Dec. 31,
2005.
As of June 30, 2006, the Company carried about US$1.505 billion
of claim and claim adjustment expense reserves, net of
reinsurance recoverables, for reported and unreported asbestos-
related claims. (Class Action Reporter, Aug. 11, 2006)
As of Sept. 30, 2006, the Company carried about US$2.375 billion
of claim and claim adjustment expense reserves, gross, for
reported and unreported asbestos-related claims, compared with
US$2.992 billion as of Dec. 31, 2005.
For the three months ended Sept. 30, 2006 and Sept. 30, 2005,
the Company recorded US$1 million of unfavorable asbestos-
related net claim and claim adjustment expense reserve
development.
For the three months ended Sept. 30, 2006, the Company paid
US$26 million for asbestos-related claims, net of reinsurance,
compared with US$42 million for the three months ended Sept. 30,
2005.
For the nine months ended Sept. 30, 2006, the Company paid US$76
million for asbestos-related claims, net of reinsurance
recoveries, compared with US$115 million for the nine months
ended Sept. 30, 2005.
For the nine months ended Sept. 30, 2006, the Company recorded
US$2 million of unfavorable asbestos-related net claim and
claims adjustment expense reserve development, compared with
US$8 million for the nine months ended Sept. 30, 2005.
At Sept. 30, 2006, the Company had 1,361 policyholders, compared
with 1,324 policyholders at Dec. 31, 2005. At Sept. 30, 2006,
about 81 percent of the Company's total active asbestos accounts
were classified as small accounts.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: Court Mulls Guarding CNA from Future Claims
----------------------------------------------------------------
A U.S. Bankruptcy court is scheduled to consider confirmation of
a bankruptcy plan of reorganization with an injunction to
protect CNA Financial Corp. from future asbestos-related claims
by the end of 2006.
On Feb. 13, 2003, the Company said it had resolved asbestos
related coverage litigation and claims involving A.P. Green
Industries, A.P. Green Services, and Bigelow-Liptak Corp.
Under the agreement, the Company is required to pay US$74
million, net of reinsurance recoveries, over a 10-year period to
start after the final approval of the reorganization plan.
The settlement resolves the Company's liabilities for all
pending and future asbestos and silica claims involving A.P.
Green Industries, Bigelow-Liptak, and related subsidiaries,
including alleged "non-products" exposures.
On Aug. 18, 2003, the settlement received initial bankruptcy
court approval.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Financial Faces Keasbey Claims Dispute
----------------------------------------------------------------
CNA Financial Corp. is still engaged in insurance coverage
litigation in New York State Court with a defendant class of
underlying plaintiffs who have asbestos bodily injury claims
against the former Robert A. Keasbey Co.
Filed in 2003, the lawsuit, Case No. 601037/03, is styled
Continental Casualty Co. v. Employers Ins. of Wausau et al.,
which is pending in New York County.
A currently dissolved corporation, Keasbey sold and installed
asbestos-containing insulation products in New York and New
Jersey. Plaintiffs have filed bodily injury claims against
Keasbey.
However, Keasbey's involvement at several work sites is a highly
contested issue. Therefore, the defense disputes the percentage
of valid claims against Keasbey.
The Company issued Keasbey primary policies for 1970-1987 and
excess policies for 1972-1978. The Company has paid an amount
equal to the policies' aggregate limits for products and
completed operations claims in the confirmed Company policies.
Claimants against Keasbey alleged that the Company owes coverage
under sections of the policies not subject to the aggregate
limits, an allegation the Company contests in the suit. In the
suit, the Company and the claimants seek declaratory relief as
to the interpretation of various policy provisions.
On March 21, 2004, the Court dismissed a claim alleging bad
faith and seeking unspecified damages, in which the Appellate
Division, First Department, affirmed the ruling on March 31,
2005.
On July 13, 2005, the trial in the Keasbey coverage action
commenced and closing arguments concluded on Oct. 28, 2005.
In January 2006, the Court reopened the record for more
evidentiary submissions and briefing, and more closing arguments
were held March 27, 2006.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Financial Deals With Burns & Roe Action
----------------------------------------------------------------
CNA Financial Corp. has insurance coverage disputes related to
asbestos bodily injury claims against a bankrupt insured, Burns
& Roe Enterprises Inc., which provided engineering and related
services in connection with construction projects.
These disputes are part of coverage litigation, which is stayed
in view of Burns & Roe's bankruptcy, and an adversary proceeding
styled In re: Burns & Roe Enterprises Inc., pending in the U.S.
Bankruptcy Court for the District of New Jersey, Case No. 00-
41610.
At the time of its filing on Dec. 4, 2000, Burns & Roe asserted
that it faced about 11,000 claims alleging bodily injury
resulting from asbestos exposure from construction projects in
which it was involved.
The Company allegedly provided primary liability coverage to
Burns & Roe from 1956-1969 and 1971-1974, along with certain
project-specific policies from 1964-1970.
The litigation involves disputes over the confirmation of the
Plan of Reorganization in bankruptcy, the scope and extent of
coverage afforded to Burns & Roe for its asbestos liabilities.
On Dec. 5, 2005, Burns & Roe filed its Third Amended Plan of
Reorganization. A confirmation hearing relating to that Plan is
expected in 2007. Coverage issues will be determined in a later
proceeding.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Financial Units Have Suits in 4 States
----------------------------------------------------------------
Asbestos-related lawsuits have been filed directly against two
CNA Financial Corp. companies and numerous other insurers in
four jurisdictions: Ohio, Texas, West Virginia, and Montana.
In about 70 Ohio actions filed to date, plaintiffs alleged that
the defendants negligently performed duties undertaken to
protect workers and the public from the effects of asbestos,
altered evidence and conspired and acted in concert to harm the
plaintiffs.
Some of these lawsuits are styled: Varner v. Ford Motor Co.,
pending in the Ohio Ct. Common Pl., filed on June 12, 2003;
Peplowski v. ACE American Ins. Co., pending in the N.D. Ohio,
filed on April 1, 2004; and Cross v. Garlock Inc., pending in
the Ohio Ct. Common Pl., filed on Sept. 1, 2004.
In the most recent of these cases, plaintiffs have made
negligent undertaking claims against the insurers. A certain
suit is styled: Ball v. Goodyear Tire & Rubber Co., pending in
the Ohio Ct. Common Pl., filed on May 16, 2005.
The Cuyahoga County court granted insurers, including the
Company, dismissals against an initial group of plaintiffs,
ruling that insurers had no duty to warn plaintiffs about the
dangers of asbestos and that there was no basis for spoliation,
conspiracy and concert of action claims. That ruling was
affirmed on appeal. The action is styled Bugg v. Am. Std. Inc.,
Case No. 84829, which is pending in Ohio Ct. App., filed on May
26, 2005.
The case that is pending at this time is Peplowski, which was
transferred to the federal Multi-District Litigation court in
October 2004 and has been dormant since then.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Companies Face Lawsuits in Tex. Courts
---------------------------------------------------------------
Asbestos-related lawsuits, since 2002, were filed in Texas
against two CNA Financial Corp. companies and numerous other
insurers and non-insurer corporate defendants.
These suits asserted liability for failing to warn of the
dangers of asbestos. One suit was styled Boson v. Union Carbide
Corp., which is pending in Nueces County, Tex.
In 2003, many of the Texas suits were dismissed as time-barred
by the applicable Statute of Limitations. In other suits, the
carriers argued that they did not owe any duty to the plaintiffs
or the general public to advise the world or the plaintiffs of
the effects of asbestos and that Texas statutes precluded
liability for those claims. Two Texas courts dismissed these
suits. Certain of the Texas courts' rulings were appealed, but
plaintiffs later dismissed their appeals.
Another Texas court denied similar motions seeking dismissal at
the pleading stage, allowing limited discovery to proceed. After
that court denied a related challenge to jurisdiction, the
insurers transferred those cases to a state multi-district
litigation court in Harris County charged with handling asbestos
cases, and the cases remain in that court.
The insurers have petitioned the appellate court in Houston,
Tex. for an order of mandamus, requiring the multi-district
litigation court to dismiss the cases on jurisdictional and
substantive grounds.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Unit Reaches Settlement in Adams Action
----------------------------------------------------------------
Continental Casualty Co., a CNA Financial Corp. subsidiary, on
Sept. 18, 2006, reached a settlement with plaintiffs in an
amended asbestos-related lawsuit styled Adams v. Ins. Co. of
North America et al., which is pending in the S.D. W. Va., Case
No. 2:05-CV-0527.
The settlement was conditioned upon court approval and
completion of satisfactory documentation.
On June 28, 2002, CCC was named in a lawsuit styled Adams v.
Aetna Inc., et al., which was filed in the Circuit Court of
Kanawha County, W.Va., Case Nos. 0-2C-1708 to -1719.
The litigation was a purported class action against CCC and
other insurers, alleging that the defendants violated West
Virginia's Unfair Trade Practices Act in handling and resolving
asbestos claims against five named asbestos defendants.
The court has stayed the Adams litigation pending a planned
motion by plaintiffs to file an amended complaint that reflected
two June 2004 decisions of the W.Va. Supreme Court of Appeals.
In June 2005, the court presiding over Adams and three similar
putative class actions against other insurers directed
plaintiffs to file any amended complaints by June 13, 2005. The
court directed the parties to agree upon a case management order
that would result in trial being commenced by July 2006.
The Amended Complaint expands the scope of the action against
the insurers, including CCC.
The defendant insurers, including CCC, are now sued for alleged
breaches of the UTPA in connection with handling and resolving
asbestos personal injury and wrongful death claims in W.Va.
courts against all their insureds if those claims were resolved
before June 30, 2001.
CCC, along with other insurer defendants removed the Adams case
to Federal court. A motion by plaintiffs to remand the case to
state courts was granted on March 30, 2006.
The Amended Complaint continues to seek compensatory damages for
the alleged delay in resolving plaintiffs' underlying asbestos
claims and for aggravation allegedly caused by that delay and
punitive damages.
The trial court has stated that it intends for trial in the case
to commence in July 2007.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: CNA Faces Lawsuit Filed by 8 Grace Workers
---------------------------------------------------------------
CNA Financial Corp., since March 22, 2002, has been facing an
asbestos-related direct action filed in Montana by eight
individual plaintiffs, who are all W.R. Grace & Co. employees.
The action, styled Pennock, et al. v. Maryland Casualty, et al.,
which was filed in the First Judicial District Court of Lewis &
Clark County, Mont., also names Maryland Casualty and the State
of Montana.
This action alleged that the carriers failed to warn of or
otherwise protect Grace employees from the dangers of asbestos
at a W.R. Grace vermiculite mining facility in Libby, Mont.
The Montana direct action is currently stayed because of Grace's
pending bankruptcy.
Headquartered in Chicago, Ill., CNA Financial Corp. provides
commercial coverage, such as workers' compensation, general and
professional liability, and other products for businesses and
institutions. Loews Corp. owns 91 percent of CNA.
ASBESTOS LITIGATION: Hercules Has 30,125 Pending Claims in 3Q06
---------------------------------------------------------------
Hercules Inc., as of Sept. 30, 2006, recorded about 30,125
unresolved asbestos-related claims, of which about 995 were
premises claims and the rest were products claims.
The Company defends in asbestos-related personal injury lawsuits
and claims which arise from alleged exposure to asbestos fibers
from resin encapsulated pipe and tank products, which were sold
by one of the Company's former subsidiaries ("products claims").
The Company also defends in suits alleging exposure to asbestos
at facilities formerly or presently owned or operated by the
Company ("premises claims").
The Company also recorded about 2,200 unpaid claims, which have
been settled or are subject to the terms of a settlement
agreement.
Moreover, as of Sept. 30, 2006, the Company had about 565
claims, which have either been dismissed without payment or are
in the process of being dismissed without payment. However, the
plaintiffs retain the right to re-file should they be able to
establish exposure to an asbestos-containing product for which
the Company bears liability.
Between Jan. 1, 2006 and Sept. 30, 2006, the Company received
about 2,235 new claims. In that same period, the Company spent
about US$22.9 million on these matters, including US$16.8
million in settlement payments and about US$6.1 million for
defense costs.
As of June 30, 2006, the Company had about 30,070 unresolved
asbestos-related claims, of which about 1,010 were premises
claims and the rest were products claims. (Class Action
Reporter, Aug. 18, 2006)
Headquartered in Wilmington, Del., Hercules Inc.'s pulp and
paper division supplies water-treatment and functional
performance chemicals and services to the pulp and paper
industry. Its Aqualon unit makes thickeners for water-based
products such as latex paints, printing inks, and oral hygiene
products.
ASBESTOS LITIGATION: Hercules Inc. Has $253.2M Liabilities in 3Q
----------------------------------------------------------------
Hercules Inc.'s asbestos-related liabilities, for the nine
months ended Sept. 30, 2006, were US$253.2 million, of which
US$36.4 million were current and US$216.8 million were non-
current.
As of June 30, 2006, the Company's asbestos-related liabilities
were US$256.8 million, in which US$36.4 million were current and
US$220.4 million were non-current. (Class Action Reporter, Aug.
18, 2006)
As of Sept. 30, 2006, the Company's non-current asbestos-related
assets were US$97.3 million, compared with US$120.7 million as
of Dec. 31, 2005.
As of June 30, 2006, the Company's non-current asbestos-related
assets were US$102.9 million. (Class Action Reporter, Aug. 18,
2006)
The Company's primary and first level excess insurance policies
that provided coverage for asbestos-related matters exhausted
their products limits at or before the end of July 2003.
Effective Aug. 23, 2004, the Company entered into a confidential
settlement agreement with respect to those insurance policies
issued by certain underwriters at Lloyd's, London, and reinsured
by Equitas Ltd. and related entities.
Equitas paid US$30 million to the Company and placed US$67
million into a trust set up to reimburse the Company for a
portion of the costs incurred by the Company to defend and
resolve certain asbestos claims. As of Sept. 30, 2006, US$44.4
million remains in the trust.
Effective Oct. 8, 2004, the Company entered into a settlement
agreement with respect to certain insurance policies issued by
various insurance companies operating in the London insurance
market, and by an insurance company in the United States. The
participating insurers agreed to place into trust over a four-
year period commencing in January 2005 and ending in 2008
monies, which will ultimately total about US$102.2 million.
As of Sept. 30, 2006, US$68.5 million of the US$102.2 million
has been placed into the trust, of which US$20.4 million remains
in the trust.
For the three months ended Sept. 30, 2006, the Company spent
US$2.2 million in legal fees for asbestos-related litigation
costs and net of interest accretion from the asbestos-insurance
trusts.
For the nine months ended Sept. 30, 2006, the Company spent
US$6.7 million in legal fees for asbestos-related litigation
costs and net of interest accretion from the asbestos-insurance
trusts.
Headquartered in Wilmington, Del., Hercules Inc.'s pulp and
paper division supplies water-treatment and functional
performance chemicals and services to the pulp and paper
industry. Its Aqualon unit makes thickeners for water-based
products such as latex paints, printing inks, and oral hygiene
products.
ASBESTOS LITIGATION: Claims v. Cytec Ind. Drop to 9.1T in 3Q06
--------------------------------------------------------------
Cytec Industries Inc., in the nine months ended Sept. 30, 2006,
recorded 9,100 claimants in asbestos-related lawsuits, compared
with 18,100 claimants in the year ended Dec. 31, 2005.
In the six months ended June 30, 2006, the Company recorded
10,000 claimants in asbestos-related suits. (Class Action
Reporter, Aug. 11, 2006)
In the nine months ended Sept. 30, 2006, the Company recorded
11,900 claimants associated with claims closed, compared with
12,000 claimants in the year ended Dec. 31, 2005.
In the nine months ended Sept. 30, 2006, the Company recorded
2,900 claimants associated with claims opened, compared with
2,100 claimants in the year ended Dec. 31, 2005.
As of Sept 30, 2006, the Company's aggregate self-insured and
insured contingent liability was US$72.9 million, compared with
US$65.8 million as of Dec. 31, 2005.
At Sept. 30, 2006, the related insurance recovery receivable
related to the liability as well as claims for past payments was
US$43.2 million, compared with US$37.7 million at Dec. 31, 2005.
Headquartered in West Paterson, N.J., Cytec Industries Inc.
produces chemicals from which it makes engineered materials,
specialty chemicals, and additives used in treating water and in
industrial processes.
ASBESTOS LITIGATION: Court Withdraws USG Property Damage Claims
---------------------------------------------------------------
Southwest Texas State University filed Claim No. 4683 against
USG Corp. and the other Debtors, which was eventually settled
and released in the proceeding of Kirbyville Independent School
District, et al. v. United States Gypsum Company, Civil Action
No. 1:97CV0542 in the U.S. District Court for the Eastern
District of Texas, Beaumont Division.
The University of California at San Diego also filed Claim No.
7109 against the Debtors, which was later revealed to be
duplicative of Claim Nos. 4778 and 4779. The University's Board
of Regents filed Claim Nos. 4778 and 4779 for asbestos property
damage claims in relation to the Board's assertion that 270 of
the University's 286 buildings have or had asbestos-containing
materials manufactured by Debtors.
To resolve all matters related to Claim Nos. 4683 and 7109, the
Reorganized Debtors, STSU and UCSD entered into a stipulation
and agree that the Claims are withdrawn with prejudice.
(USG Bankruptcy News, Issue No. 126; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ASBESTOS LITIGATION: Hardie Trust Not to Pay Taxes, Premier Says
----------------------------------------------------------------
New South Wales Premier Morris Iemma said the structure devised
by James Hardie Industries NV, to ensure its asbestos
compensation fund would not pay tax, involved setting up a
discretionary trust, The Sydney Morning Herald reports.
The creation of the discretionary trust is in addition to the
charitable trust announced in 2005.
Mr. Iemma disclosed the details when he introduced legislation
to validate the US$1.6 billion compensation scheme.
Mr. Iemma said the new arrangement, approved by the Australian
Taxation Office on Nov. 8, 2006, achieved the same tax outcome
as a structure rejected by the ATO in June 2006.
As originally planned, Hardie will contribute funds to the
charitable trust on a rolling basis, ensuring it always has
between two and three years' expected payments.
The discretionary trust will hold the investment earnings of the
charitable trust. The new legislation allows either trust to
distribute compensation funds.
On Nov. 8, 2006, the ATO ruled that Hardie's contributions would
not be assessable income of the charitable trust.
In a Nov. 1, 2006 press release, Hardie said two of the private
binding rulings being sought from the ATO related to its former
asbestos-producing subsidiaries, Amaca Pty. Ltd. and Amaba Pty.
Ltd.
Asbestos disease sufferers have traditionally sued those two
companies as the sources of the damaging products. Amaca and
Amaba appear to be the beneficiaries of the two trusts under the
new structure. They in turn will pay no tax because their
payments to asbestos victims will be a deductible expense linked
to their former business of selling building products.
The use of a trust was a condition imposed on Hardie by unions
and asbestos support groups during negotiations over how it will
pay all valid compensation claims when Amaca and Amaba ran out
of money.
Headquartered in Sydney, Australia, James Hardie Industries NV
uses cellulose-reinforced fiber cement to create products for
residential and commercial construction, including siding,
external cladding, walls, fencing, and roofing. The Company
makes fiber-reinforced concrete pipe through its Hardie Pipe
business and roofing through Artisan Roofing.
ASBESTOS LITIGATION: Federal-Mogul Files 4th Reorganization Plan
----------------------------------------------------------------
Federal-Mogul Corp. filed its 4th amended Chap. 11 Plan of
Reorganization, taking a step toward closing one of the longest-
running bankruptcy cases of an auto-parts maker, The Associated
Press reports.
Documents filed in connection with the new Chap. 11 Plan are set
on a March 31, 2007 bankruptcy exit for the Company.
According to Jefferies & Co., the Company's financial adviser,
its total enterprise value is expected to be US$4.4 billion to
US$4.7 billion, assuming it pushes its Chap. 11 Plan through the
courts and exits bankruptcy.
The revised Chap. 11 Plan comes after a planned arrangement in
the United Kingdom to settle asbestos-related liabilities
related to the Company's Turner & Newall Ltd. subsidiary.
The U.S. side of the Company's reorganization began in 2001,
when the Company resorted to Chap. 11 bankruptcy in an effort to
shake off massive liabilities related to asbestos products.
Carl Icahn, the billionaire investor who holds a major stake in
the Company's debt, will be buying the new issue of Class B
stock from a trust that will be set up to pay asbestos claims
against the Company.
The call-option arrangement means immediate liquidity for the
asbestos trust and control of the Company, without its asbestos
liabilities, for Mr. Icahn.
Deals to settle the Company's liabilities to Cooper Industries
Inc. and Pneumo Abex Corp. are also built into the new plan,
which is the latest in a string of reorganization proposals for
the Company.
The Company's Chap. 11 exit strategy calls for balloting by
asbestos claimants.
Headquartered in Southfield, Mich., Federal-Mogul Corp. makes
components for cars, trucks, and construction vehicles. The
Company's products include chassis and engine parts, pistons,
and sealing systems under brand names like Federal-Mogul, Glyco,
and Signal-Stat.
ASBESTOS LITIGATION: DaimlerChrysler to Pay $20M in Injury Suit
---------------------------------------------------------------
A New York Supreme Court jury order DaimlerChrysler AG to pay
US$20 million to Alfred D'Ulisse, a New York City brake
repairman who lost his right lung to mesothelioma, Bloomberg.com
reports.
The jury found that the Company was 10 percent responsible for
injuries to the 73-year-old Mr. D'Ulisse. The jury said the
Company acted with reckless disregard, making it liable for 80
percent of the US$25 million verdict, said Mr. D'Ulisse's
lawyer, Jerry Kristal.
Mr. D'Ulisse testified in the trial, which began on September
2006, that he was exposed to asbestos in auto-brake linings made
by Chrysler and General Motors Corp. while working at Morak
Brakes in Brooklyn, N.Y., from 1960 to 1981. His job was to
strip worn linings from brakes and replace them with new ones.
Steven B. Hantler, assistant general counsel for the Company,
said he will appeal the D'Ulisse verdict and is confident it
will be overturned.
The jury awarded Mr. D'Ulisse US$10 million for pain and
suffering and the same amount for future pain and suffering. His
wife, Margaret, was awarded US$5 million for the loss of her
husband's services and society because of his cancer.
The jury found General Motors Corp. and Ford Motor Co. each 10
percent liable for Mr. D'Ulisse's injuries. Both companies had
previously settled with Mr. D'Ulisse for an undisclosed amount.
The suit was styled: Alfred D'Ulisse and Margaret D'Ulisse v.
DaimlerChrysler, Index no. 113939/04, New York Supreme Court
(Manhattan).
Headquartered in Stuttgart, Germany, DaimlerChrysler AG makes
about 4.6 million vehicles a year with brands including Dodge,
Jeep, and Chrysler vehicles. The Mercedes Car Group includes
Mercedes, Maybach (ultra-luxury vehicles), and smart (mini
cars).
New Securities Fraud Cases
BODISEN BIOTECH: Glancy Binkow Files Securities Suit in N.Y.
------------------------------------------------------------
Glancy Binkow & Goldberg, LLP, filed a class action in the U.S.
District Court for the Southern District of New York on behalf
of a class consisting of all persons or entities that purchased
or otherwise acquired the common stock of Bodisen Biotech, Inc.
between Aug. 26, 2005 and Nov. 14, 2006.
The complaint charges Bodisen, certain of the company's
executive officers, and Benjamin Wey (a/k/a Benjamin Wei) and
his company New York Global Group, Inc. (NYGG) with violations
of federal securities laws.
Among other things, plaintiff claims that defendants' material
omissions and dissemination of materially false and misleading
statements concerning Bodisen's business and operations caused
the company's stock price to become artificially inflated,
inflicting damages on investors.
Bodisen describes itself as primarily engaged in the
development, manufacture and sales of organic fertilizers and
pesticides in the People's Republic of China.
The complaint alleges that during the class period defendants
failed to disclose material information concerning the company's
relationships with Benjamin Wey, NYGG and related companies.
On Nov. 12, 2006, Bodisen issued a press release stating, among
other things, that it had received a Deficiency Letter from the
American Stock Exchange (AMEX), concerning Bodisen's
relationship with NYGG, stating that "AMEX believes that the
company made insufficient or inaccurate disclosure in its public
filings with regard to its relationship with, and payments to, a
consultancy firm and its affiliates both prior to and subsequent
to its listing on the AMEX.
Additionally, in the context of the company's relationship with
the consultancy firm, AMEX expressed concern that the company
has internal control issues related to its accounting and
financial reporting obligations."
The Nov. 12, 2006, press release followed news reports, which
had raised concerns about the company's relationships with
Benjamin Wey and NYGG and certain of its affiliated entities.
Interested parties may move the court, no later than Jan. 15,
2007, to serve as lead plaintiff.
For more details, contact Michael Goldberg, Esq., of Glancy
Binkow & Goldberg, LLP, 1801 Avenue of the Stars, Suite 311, Los
Angeles, California 90067, Phone: (310) 201-9150 or (888) 773-
9224, E-mail: info@glancylaw.com, Web site:
http://www.glancylaw.com.
BRANTLEY CAPITAL: Wechsler Harwood Files Securities Suit in N.Y.
----------------------------------------------------------------
Wechsler Harwood, LLP, filed a class action in the U.S. District
Court for the Southern District of New York on behalf of all
persons who purchased the common stock of Brantley Capital Corp.
between Aug. 14, 2003 and Oct. 24, 2005.
The complaint charges Brantley and certain of its officers with
violations of federal securities laws by making
misrepresentations about the company's valuation and financial
statements.
Brantley grossly overvalued its investment in a material asset.
When properly valued, that asset was worth less than 1% when the
company valued it.
As a result, the company's stock fell from a class period high
of approximately $12 per share to a price of approximately $2,
and the company has now started its intent to liquidate.
Interested parties may move the court no later than Jan. 16,
2007, for appointment as lead plaintiff of the class.
For more details, contact Virgilio Soler, Jr., of Wechsler
Harwood, LLP, 488 Madison Avenue, New York, New York 10022,
Phone: 877-935-7400, E-mail: vsoler@whesq.com, Web site:
http://www.whesq.com.
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent researches,
collectively face billions of dollars in asbestos-related
liabilities.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA. Glenn Ruel Senorin, Maria Cristina Canson, and Janice
Mendoza, Editors.
Copyright 2006. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
The CAR subscription rate is $575 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
* * * End of Transmission * * *