/raid1/www/Hosts/bankrupt/CAR_Public/061205.mbx
C L A S S A C T I O N R E P O R T E R
Tuesday, December 5, 2006, Vol. 8, No. 241
Headlines
ALLIANCE IMAGING: Agrees to Settle Wage, Hour Lawsuit in Calif.
AUTOBYTEL INC: Calif. Court Okays $6.75M Stock Suit Settlement
AUTOBYTEL INC: Court Still Mulling Approval for IPO Settlement
CALPINE CORP: Asks Bankruptcy Court to Extend Automatic Stay
CALPINE CORP: Pensioners to Appeal Extended Automatic Stay
CAMBREX CORP: Yet to Pay $3,048 to Settle Suit Over Mylan Deal
CITADEL SECURITY: Dec. 15 Hearing Set for Stock Suit Settlement
CITIBANK N.A.: Feb. 2007 Hearing Set for FCRA Suit Settlements
CORNELL COMPANIES: Faces Tex. Stockholder Suit on Veritas Merger
CORNELL COMPANIES: Parties Reach $7M Tex. Stock Suit Settlement
CORNELL COMPANIES: Settles N.Mex. Strip Search Suit for $1.6M
CORPORATE LIBRARY: Report Lists Firms Likely to Face Stock Suits
DISCOVERY LABORATORIES: Plaintiffs File Second Amended Complaint
EXPRESS FORESTRY: Reaches $220T Settlement for La. Workers' Suit
FAMILY DOLLAR: N.C. Backdating Stock Options Suits Consolidated
GUITAR CENTER: Continues to Face RICO Suit Over Fla. Operations
GUITAR CENTER: Reaches $2.9M Settlement for Calif. Labor Suits
ISOLAGEN INC: Seeks Dismissal of Consolidated Stock Suit in Pa.
JP MORGAN: N.Y. Judge Allows Plaintiffs' Claims to Proceed
L-1 IDENTITY: Seeks Dismissal of Mass. Consolidated Stock Suit
MORTGAGEIT HOLDINGS: Dec. Hearing Set for N.Y. Stockholder Suit
NEW YORK: Consolidated Securities Suit Over Merger Dismissed
O MAGAZINE: Disgruntled Subscriber Files Double-Billing Lawsuit
PLANTRONICS INC: Faces Lawsuits Over Headsets in Calif., Fla.
PRICELINE.COM INC: Discovery Deadline in Conn. Suit Set Dec. 07
PRICELINE.COM INC: Delaware Consumer Fraud Act Claims Dismissed
PRICELINE.COM: No Ruling Yet in N.Y. Court IPO Suit Settlement
PROGRESSIVE GAMING: Nev. Court Junks Some Claims in Stock Suit
TORCHMARK CORP: Court Voids Judgment in Cancer Policies Lawsuit
TORCHMARK CORP: Trial for Vesta Insurance Suit in Ala. Stayed
TRAVEL COS: Faces 14 Suits Related to Hotel Occupancy Taxes
UNITEDHEALTH GROUP: Court Freezes Retirement Pay of Outgoing CEO
UNITED AMERICAN: Plaintiffs Initiate Amended Fraud Lawsuit in TX
VALICERT INC: N.Y. Court Mulls Final Approval of IPO Suit Deal
New Securities Fraud Cases
BRANTLEY CAPITAL: Brower Piven Announces N.Y. Stock Suit Filing
HANSEN NATURAL: Wolf Haldenstein Files Securities Suit in Calif.
WARNER CHILCOTT: Yourman Alexander Announces Stock Suit Filing
*********
ALLIANCE IMAGING: Agrees to Settle Wage, Hour Lawsuit in Calif.
---------------------------------------------------------------
Alliance Imaging, Inc., settled a purported class action filed
in Alameda County Superior Court, alleging wage and hour claims
on behalf of a putative class of approximately 400 former and
current California employees of the company.
On May 5, 2005, the company was served with a class action
complaint. On Aug. 19, 2005, the plaintiffs filed an amended
complaint, which the company answered on Sept. 23, 2005.
In this suit, "Linda S. Jones, et al. v. Alliance Imaging, Inc.,
et al.," the plaintiffs allege violations of California's wage,
meal period, and break time laws and regulations.
Plaintiffs sought recovery of unspecified economic damages,
statutory penalties, attorneys' fees, and costs of suit. On or
about March 10, 2006, plaintiffs filed a second amended
complaint (later further amended by a third amended complaint)
adding a cause of action for conversion and a plea for punitive
damages.
The company filed a demurrer and motion to strike seeking to
dismiss the new claim and plea. On July 19, 2006, the company
and the Plaintiffs entered into a tentative settlement of the
class action complaint pursuant to which the company has agreed
to pay $2,500, which is included in other accrued liabilities at
Sept. 30, 2006, in exchange for a dismissal with prejudice of
all claims brought on behalf of the putative class under the
class action complaint.
On Sept. 8, 2006, the court preliminarily approved the
settlement and a conditional class was certified for purposes of
seeking class approval of the settlement.
On Oct. 2, 2006, notice was mailed to the conditional class
members outlining the terms of the settlement and providing all
class members with an opportunity to opt out of the settlement.
Alliance Imaging, Inc. in the Net:
http://www.allianceimaging.com.
AUTOBYTEL INC: Calif. Court Okays $6.75M Stock Suit Settlement
--------------------------------------------------------------
The U.S. District Court for the Central District of California
approved proposed $6,750,000 settlement in the mater, "Scott
Tanne, et al., v. Autobytel, Inc., Michael Fuchs, Jeffrey
Schwartz, Hoshi Printer, and Amit Kothari, Case No. CV 04-8987
CAS (JWJx)."
The settlement covers all persons who purchased or otherwise
acquired, directly or indirectly, the common stock of Autobytel
between July 24, 2003 and October 21, 2004.
On Oct. 29, 2004, the first of five class action complaints was
filed against Autobytel, Michael Fuchs, Jeffrey Schwartz,
Hoshi Printer and Amit Kothari, on behalf of a class of public
investors who purchased or otherwise acquired the common stock
of Autobytel during the class period.
By an order dated Jan. 28, 2005, the court consolidated all five
cases. On March 14, 2005, the court appointed the Lead
Plaintiff, and approved lead plaintiff's selection of Schiffrin
& Barroway, LLP as lead counsel.
The consolidated amended class action complaint was filed on
June 30, 2005. As stated above, the complaint alleged, among
other things, that Autobytel and the individual defendants
issued false and misleading financial statements, press releases
and other statements regarding Autobytel's financials, business
operations and future prospects during the class period.
The complaint alleged that defendants' conduct artificially
inflated the price of Autobytel's common stock, injuring
Autobytel's shareholders who purchased or otherwise acquired the
common stock at inflated prices during the class period.
On Aug. 1, 2005, defendants moved to dismiss the complaint.
Plaintiffs filed their opposition to defendants' Motion to
Dismiss on Nov. 2, 2005, and defendants filed a reply brief in
support of the motion to dismiss on Feb. 17, 2006.
In the midst of these filings, the parties agreed to submit this
matter to mediation and met before the Judge Daniel Weinstein
(Ret.) on Sept. 9, 2005.
The parties did not come to a resolution at the mediation, but
settlement negotiations continued. In or around March 2006 the
basic terms of the Settlement were reached. The defendants'
motion to dismiss was pending at the time the Parties reached
the proposed Settlement.
At the final settlement hearing on Oct. 30, 2006, the court
approved the settlement, according to the company's Nov. 9, 2006
Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended Sept. 30, 2006.
For more details, contact:
(1) Tanne v. Autobytel, Inc. et al. Securities Litigation,
c/o The Garden City Group, Inc., Claims Administrator,
P.O. Box 9000 #6423, Merrick, NY, 11566-9000, Phone: 1-
800-382-2630, Web site: http://www.gardencitygroup.com;
and
(2) Kay E. Sickles of Schiffrin & Barroway, LLP, 280 King
of Prussia Road, Radnor, PA 19087, Phone: (610) 667-
7706, Fax: (610) 667-7056, E-mail: info@sbclasslaw.com.
AUTOBYTEL INC: Court Still Mulling Approval for IPO Settlement
--------------------------------------------------------------
The U.S. District Court for the Southern District of New York
has yet to issue a final order regarding the settlement of the
consolidated securities class action against Autobytel, Inc.,
according to the company's Nov. 9, 2006 Form 10-Q filing with
the U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
In August 2001, a purported class action was filed in the U.S.
District Court for the Southern District of New York against the
company and certain of the company's current and former
directors and officers and underwriters involved in the
company's initial public offering.
The complaints against the company were consolidated with two
other complaints that relate to its initial public offering but
do not name it as a defendant. A consolidated amended
complaint, which is now the operative complaint, was filed on
April 19, 2002.
This action purports to allege violations of the Securities Act
of 1933 and the Securities Exchange Act of 1934. Plaintiffs
allege that the underwriter defendants agreed to allocate stock
in the company's initial public offering to certain investors in
exchange for excessive and undisclosed commissions and
agreements by those investors to make additional purchases of
stock in the aftermarket at pre-determined prices.
Plaintiffs also allege that the prospectus for the company's
initial public offering was false and misleading in violation of
the securities laws because it did not disclose these
arrangements.
The action seeks damages in an unspecified amount. It is being
coordinated with approximately 300 other nearly identical
actions filed against other companies.
A motion to dismiss issues common to the companies and
individuals who have been sued in these actions was filed on
July 15, 2002. On Oct. 9, 2002, the court dismissed the
Autobytel individual defendants from the case without prejudice
based upon stipulations of dismissal filed by the plaintiffs and
the Autobytel individual defendants.
On Feb. 19, 2003, the court denied the motion to dismiss the
complaint against the company. On Oct. 13, 2004, the court
certified a class in six of the approximately 300 other nearly
identical actions and noted that the decision is intended to
provide strong guidance to all parties regarding class
certification in the remaining cases. The underwriter
defendants sought leave to appeal this decision and the Second
Circuit has accepted the appeal.
Plaintiffs have not yet moved to certify a class in the company
case. The company has approved a settlement agreement and
related agreements, which set forth the terms of a settlement
between it, the plaintiff class and the vast majority of the
other approximately 300 issuer defendants.
Among other provisions, the settlement provides for a release of
the company and the Autobytel individual defendants for the
conduct alleged in the action to be wrongful. The company would
agree to undertake certain responsibilities, including agreeing
to assign away, not assert, or release certain potential claims
the company may have against its underwriters.
The settlement agreement also provides a guaranteed recovery of
$1 billion to plaintiffs for the cases relating to all of the
approximately 300 issuers.
To the extent that the underwriter defendants settle all of the
cases for at least $1 billion, no payment will be required under
the issuers' settlement agreement.
To the extent that the underwriter defendants settle for less
than $1 billion, the issuers are required to make up the
difference.
It is anticipated that any potential financial obligation of the
company to plaintiffs pursuant to the terms of the settlement
agreement and related agreements will be directly covered and
paid by its insurance carriers.
The company currently is not aware of any material limitations
on the expected recovery of any potential financial obligation
to plaintiffs from its insurance carriers. Its carriers are
solvent, and the company is not aware of any uncertainties as to
the legal sufficiency of an insurance claim with respect to any
recovery by plaintiffs.
Therefore, the company does not expect that the settlement will
involve any payment by it. If material limitations on the
expected recovery of any potential financial obligation to the
plaintiffs from the company's insurance carriers should arise,
the company's maximum financial obligation to plaintiffs
pursuant to the settlement agreement would be less than $3.4
million.
On Feb. 15, 2005, the court granted preliminary approval of the
settlement agreement, subject to certain modifications
consistent with its opinion. Those modifications have been
made.
On March 20, 2006, the underwriter defendants submitted
objections to the settlement to the court. The court held a
hearing regarding these and any other objections to the
settlement at a fairness hearing on April 24, 2006. There is no
assurance that the court will grant final approval to the
settlement.
For more details, visit http://www.iposecuritieslitigation.com/.
CALPINE CORP: Asks Bankruptcy Court to Extend Automatic Stay
------------------------------------------------------------
Defendants in the consolidated suit alleging Employee Retirement
Income Security Act violations by Calpine Corp. have until
January 2007 to oppose the continuation of the suit in light of
its bankruptcy filing.
Two nearly identical class action complaints alleging claims
under ERISA were consolidated as, "In re Calpine Corp. ERISA
Litigation, Master File No. C 03-1685 SBA," in the Northern
District Court, against:
-- Calpine Corp.;
-- the members of Calpine Corp.'s Board of Directors;
-- the 401k Plan's Advisory Committee and its members;
-- signatories of the 401k Plan's Annual Return/Report of
Employee Benefit Plan Forms 5500 for 2001 and 2002;
-- an employee of a consulting firm hired by the 401k Plan;
and
-- unidentified fiduciary defendants.
The suits allege claims under ERISA purportedly on behalf of the
participants in the 401k Plan from January 5, 2001, to the
present who invested in the Calpine unitized stock fund.
Plaintiffs allege that defendants breached their fiduciary
duties involving the 401k Plan, in violation of ERISA. The
Northern District Court dismissed all of the plaintiffs' claims
with prejudice. The plaintiffs appealed the dismissal to the
9th Circuit Court of Appeals.
In addition, Calpine Corp. filed a motion with the U.S.
Bankruptcy Court to extend the automatic stay to the individual
defendants. Plaintiffs opposed the motion and the hearing was
scheduled for June 5, 2006, however, prior to the hearing, the
parties stipulated to allow the appeal to proceed.
If the Northern District Court ruling is reversed, the
plaintiffs may then seek leave from the U.S. Bankruptcy Court to
proceed with the action. Plaintiff's opening brief was due with
the 9th Circuit Court of Appeals in November 2006.
Defendant's opposition is due in January 2007. Plaintiff may
file a reply brief within 30 days of service of the opposition
brief.
The suit is "In re Calpine Corp. ERISA Litigation, Case No.
4:03-cv-01685-SBA," filed in the U.S. District Court for the
Northern District of California under Judge Saundra Brown
Armstrong.
Representing the plaintiffs are:
(1) Edward W. Ciolko and F. Andre Delfi of Schiffrin &
Barroway, LLP, 280 King of Prussia, Radnor, PA 19087,
Phone: 610-667-7706, Fax: 610-667-7056, E-mail:
eciolko@sbclasslaw.com; and
(2) Robert S. Green and Robert A. Jigarjian of Green
Welling, LLP, 595 Market Street, Suite 2750, San
Francisco, CA 94105, Phone: 415-477-6700, Fax: 415-477-
6710, E-mail: rsg@classcounsel.com.
Representing the company is Robert L. McKague of Morrison &
Foerster, LLP, 755 Page Mill Road, Palo Alto, CA 94304, Phone:
650-813-5835, Fax: 650-494-0792, E-mail: rmckague@mofo.com.
CALPINE CORP: Pensioners to Appeal Extended Automatic Stay
----------------------------------------------------------
A Dec. 11, 2006 oral argument was scheduled on a notice of
appeal by the Hawaii Structural Ironworkers Pension Fund against
an order extending automatic stay to the individual defendants
in a securities suit filed against Calpine Corp.
The case was brought as a class action on behalf of purchasers
in Calpine's April 2002 stock offering under Section 11 of the
U.S. Securities Act.
This case was filed in San Diego County Superior Court on March
11, 2003, and subsequently transferred to Santa Clara County
Superior Court.
Defendants in this case are:
-- Calpine Corp.,
-- Peter Cartwright,
-- Ann B. Curtis,
-- John Wilson,
-- Kenneth Derr,
-- George Stathakis,
-- Credit Suisse First Boston,
-- Banc of America Securities,
-- Deutsche Bank Securities, and
-- Goldman, Sachs & Co.
The Hawaii Structural Ironworkers Pension Fund alleges that the
prospectus and registration statement for the April 2002
offering contained false or misleading statements regarding:
-- Calpine's actual financial results for 2000 and 2001;
-- Calpine's projected financial results for 2002;
-- Mr. Cartwright's agreement not to sell or purchase
shares within 90 days of the April 2002 offering; and
-- Calpine's alleged involvement in "wash trades."
This action is stayed as to Calpine Corp. as a result of the
company's Chapter 11 filing. In addition, Calpine Corp. filed a
motion with the U.S. Bankruptcy Court to extend the automatic
stay to the individual defendants (or enjoin further prosecution
of the action).
The Hawaii Structural Ironworkers Pension Fund opposed that
motion. On June 5, 2006, the U.S. Bankruptcy Court granted the
motion.
On June 13, 2006, the Santa Clara County Superior Court stayed
the action as to Credit Suisse First Boston, Banc of America
Securities, Deutsche Bank Securities, and Goldman, Sachs & Co.,
setting a case management conference for Dec. 12, 2006, to
review the status of the case.
The case is now stayed as to all defendants. On June 16, 2006,
the Hawaii Structural Ironworkers Pension Fund filed a notice of
appeal of the U.S. Bankruptcy Court's order extending the
automatic stay to the individual defendants.
Both sides have now filed briefs and oral argument is currently
scheduled for Dec. 11, 2006. There is no trial date in this
action.
Calpine Corp. in the Net: http://www.calpine.com/.
CAMBREX CORP: Yet to Pay $3,048 to Settle Suit Over Mylan Deal
--------------------------------------------------------------
Cambrex Corp. continues to pay $12,415 settlement of a suit
alleging violations of the Federal Trade Commission Act in
relation to exclusive license agreements between its subsidiary
and Mylan Laboratories Inc. to sell Active Pharmaceutical
Ingredient (API).
In 1998, the company and its subsidiary Profarmaco S.r.l.,
currently known as Cambrex Profarmaco Milano S.r.l.,
(Profarmaco) were named as defendants (along with Mylan
Laboratories and Gyma Laboratories of America, Inc.,
Profarmaco's distributor in the U.S.) in a proceeding instituted
by the Federal Trade Commission in the U.S. District Court for
the District of Columbia. Several State Attorneys' General also
commenced suits.
The suits alleged violations of the Federal Trade Commission Act
arising from exclusive license agreements between Profarmaco and
Mylan covering two APIs.
The FTC and Attorneys' General suits were settled in February
2001, with Mylan (on its own behalf and on behalf of Profarmaco
and Cambrex) agreeing to pay over $140,000 and with Mylan,
Profarmaco and Cambrex agreeing to monitor certain future
conduct.
The same parties including the company and Profarmaco have also
been named in purported class action complaints brought by
private plaintiffs in various state courts on behalf of
purchasers of the APIs in generic form, making allegations
similar to those raised in the FTC's complaint and seeking
various forms of relief including treble damages.
In April 2003, Cambrex reached an agreement with Mylan under
which Cambrex would contribute $12,415 to the settlement of
litigation brought by a class of direct purchasers.
In exchange, Cambrex and Profarmaco received from Mylan a
release and full indemnity against future costs or liabilities
in related litigation brought by purchasers, as well as
potential future claims related to this matter.
Cambrex recorded an $11,342 charge (discounted to the present
value due to the five year pay-out) in the first quarter of 2003
as a result of this settlement. In accordance with the
agreement $9,215 has been paid through Sept. 30, 2006, with the
remaining $3,200 to be paid over the next two years.
As of Sept. 30, 2006 the outstanding balance for this liability
was $3,048.
Cambrex Corp. on the Net: http://www.cambrex.com/
CITADEL SECURITY: Dec. 15 Hearing Set for Stock Suit Settlement
---------------------------------------------------------------
The U.S. District Court for the Northern District of Texas will
hold on Dec. 15, 2006 at 11:00 a.m. a hearing regarding a
proposed settlements in the class action "Lentz v. Citadel
Security Software Inc et al., Case No. 3:05-cv-00100" and the
derivative action "Baier v. Solomon et al., Case No.3:05-cv-
00846."
The class consists of all persons who:
-- purchased common stock of Citadel Security Software,
Inc. between Feb. 12, 2004 and Dec. 16, 2004,
inclusive, excluding defendants, officers and directors
of Citadel at all relevant times, members of their
immediate families, and their legal
representatives, heirs, successors, or assigns and any
entity in which Defendants have or had a controlling
interest; and/or
-- are current holders of Citadel common stock.
The hearing will be at the U.S. District Court for the Northern
District of Texas in the courtroom of the Judge Sidney A.
Fitzwater.
Deadline to file for exclusion and objection is Nov. 20, 2006.
Deadline to file claims is Jan. 4, 2007.
In 2005, Citadel Security Software, Inc., its chief executive
officer and chief financial officer faced putative securities
class actions filed in the U.S. District Court for the Northern
District of Texas (Class Action Reporter, May 11, 2005).
The suits were filed on behalf of all securities purchasers of
Citadel Security Software, Inc. from Feb. 12, 2004 through Dec.
16, 2004.
The complaint charges the company, Steven B. Solomon, and
Richard Connelly with violations of the Securities Exchange Act
of 1934.
According to the complaint, the company failed to disclose and
misrepresented the following material adverse facts, known to
defendants or recklessly disregarded by them:
-- that customer demand in the commercial portion of the
company's business was slowing;
-- that the much touted, sizable pipeline of potential
contracts failed to materialize due to poor management
execution;
-- that as a consequence of the above the company's growth
was lagging; and
-- therefore, the defendants' statements about the company
were lacking in any reasonable basis when made.
Additionally, the complaint alleges that during the class
period, defendants sold a total of 754,500 shares for proceeds
totaling more than $3 million.
On Sept. 19, 2006, parties to the class action, "Lentz v.
Citadel Security Software Inc et al., Case No. 3:05-cv-00100,"
pending in the U.S. District Court for the Northern District of
Texas agreed to settle the claims raised in the Class Action
pursuant to the terms and provisions of the Stipulation of
Settlement, after considering:
-- the substantial benefit to the class that will be
received as a result of this sttlement, compared to
the distractions, expense and uncertainty of further
litigation;
-- the company's ability to fund a settlement, if the
litigation continues to proceed; and
-- the desirability of permitting the settlement to be
consummated as provided by the terms of this
stipulation, and have concluded that the settlement is
fair, reasonable, adequate, and in the best interests
of the class and the company.
Furthermore, plaintiffs' counsel in the derivative action "Baier
v. Solomon et al., Case No.3:05-cv-00846," pending in the U.S.
District Court for the Northern District of Texas, considered
the substantial benefit to the company that will be received as
a result of this Settlement in light of the harm that the
company would suffer if the derivative action continued to
proceed, and has concluded that the settlement is fair,
reasonable, adequate, and in the best interests of the company.
Under the settlement, defendants have agreed to create a
settlement fund of $1,750,000, for the benefit of class members.
The balance of the fund, after deduction of court awarded
attorneys' fees and reimbursement of expenses and settlement
administration costs will be divided among all settlement class
Members who send in valid Proof of Claim forms.
A copy of the Settlement Notice is available free of charge at:
http://ResearchArchives.com/t/s?138b
The suit is "Lentz v. Citadel Security Software Inc et al., Case
No. 3:05-cv-00100," filed in the U.S. District Court for the
Northern District of Texas under Judge Sidney A. Fitzwater.
Representing the plaintiffs are:
(1) Gregory Linkh, Esq. of Murray Frank & Sailer, 275
Madison Ave., Suite 801, New York, NY 10016, Phone:
212-682-1818, Fax: 212-682-1892; and
(2) Joseph Sternberg of Labaton Sucharow & Rudoff, 100 Park
Ave., 12th Floor, New York, NY 10017-5563, Phone: 212-
907-0700, E-mail: jsternberg@labaton.com.
Representing defendants are:
(i) Noel M. B. Hensley and Carrie Lee Huff both of Haynes &
Boone - Dallas, 901 Main St., Suite 3100, Dallas, TX
75202-3789, Phone: 214-651-5000 or 214-651-5009, Fax:
214-200-0470, E-mail: hensleyn@haynesboone.com or
huffc@haynesboone.com; and
(ii) Heather Lee Perttula of Trinity Industries Inc., 2525
Stemmons Frwy, Dallas, TX 75207, Phone: 214-589-8937,
E-mail: heather.perttula@trin.net.
CITIBANK N.A.: Feb. 2007 Hearing Set for FCRA Suit Settlements
--------------------------------------------------------------
The U.S. District Court for the District of South Dakota will
hold a fairness hearing on Feb. 12, 2007, at 1:30 p.m., for the
proposed settlement in the matters:
-- "Nienaber v. Citibank (South Dakota), N.A., Case No.
04-4054," and
-- "Romanelli v. Associates National Bank, Case No. 05-
4130."
The hearing will be held in Courtroom 1 of the U.S. District
Court for District of South Dakota (Southern Division), located
at 400 S. Phillips Avenue, Sioux Falls, SD 57104.
The deadline to file for objections and exclusions top and from
the settlement is on Jan. 4, 2007. Deadline to file claims is on
March 16, 2007.
The purpose of this notice is to describe the proposed
settlement and provide notice to the settlement class, which
includes Each and every person who had one or more account(s),
including any cosigner, joint or authorized user on such
account(s), with Citibank (South Dakota), N.A., Associates
National Bank (Delaware) and/or Universal Bank, N.A.
(collectively "Citibank"), for which consumer report
information, in the form of account review inquiries, was
pulled, obtained or accessed on such account(s) by or on behalf
of Citibank at any time during the period beginning April 27,
2002 through Sept. 29, 2006 at a time when Citibank allegedly
did not have a permissible purpose for doing so pursuant to 15
U.S.C. Section 1681b(a) because Citibank and the person
purportedly had no relationship as described in 15 U.S.C.
Section 1681b(a)(3)(A)-(F).
Case Background
Plaintiffs Karey Nienaber and Lisa Romanelli filed separate
class action complaints against Citibank (South Dakota), N.A.
and Associates National Bank (Delaware), alleging that the banks
purportedly violated the Fair Credit Reporting Act (FCRA) in
connection with account review inquiries by supposedly accessing
consumer report information on certain accounts without a
permissible purpose.
On Sept. 29, 2006, this Court gave preliminary approval for
settlement of the actions listed above.
For more details, contact:
(1) FCRA Claim Form, PO Box 44034, Jacksonville, Florida
32231-4034, E-mail: case044054@stroock.com;
(2) Daniel R. Fritz, II of Lynn, Jackson, Shultz & Lebrun,
P.C., PO Box 1920, Sioux Falls, SD 57101-3020, Phone:
332-5999, Fax: 332-4249, E-mail:
dfritz@lynnjackson.com;
(3) James A. Francis of Francis and Mailman, PC, Land Title
Bldg., 19th Floor, 100 S. Broad St., Philadelphia, PA
19110, Phone: (215) 735-8600, Fax: (215) 940-8000, E-
mail: jfrancis@consumerlawfirm.com; and
(4) Michael D. Donovan of Donovan Searles, LLC, 1845 Walnut
St., Suite 1100, Philadelphia, PA 19103, Phone: (215)
732-6067, Fax: (215) 732-8060.
CORNELL COMPANIES: Faces Tex. Stockholder Suit on Veritas Merger
----------------------------------------------------------------
Cornell Companies, Inc., was named as a defendant in a purported
class action in the District Court of Harris County, Texas,
269th Judicial District (No. 2006-67413) by Ted Kinbergy, an
alleged stockholder of Cornell Companies, Inc., a Delaware
corporation.
Filed on Oct. 19, 2006, the complaint names as defendants the
company and each member of its board of directors as well as
Veritas Capital Fund III, L.P. It is a purported class action
that alleges, among other things, that:
-- the defendants have breached fiduciary duties they
assertedly owed to the company's stockholders in
connection with the company entering into the Agreement
and Plan of Merger, dated as of Oct. 6, 2006, with
Veritas, Cornell Holding Corp., and CCI Acquisition
Corp., and
-- the merger consideration is unfair and inadequate.
The plaintiffs seek, among other things, an injunction against
the consummation of the merger, according to company's Nov. 9,
2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the period ended Sept. 30, 2006.
Cornell Companies, Inc. on the Net:
http://www.cornellcompanies.com/.
CORNELL COMPANIES: Parties Reach $7M Tex. Stock Suit Settlement
---------------------------------------------------------------
A $7 million settlement was reached for a consolidated
securities class action filed against Cornell Companies, Inc.
and certain of its officers and directors in the U.S. District
Court for the Southern District of Texas, according to company's
Nov. 9, 2006 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the period ended Sept. 30, 2006.
In March and April 2002, the company, former president and chief
executive officer Steven W. Logan, and former chief financial
officer John L. Hendrix, were named as defendants in four
federal putative class actions:
-- "Graydon Williams et al. v. Cornell Cos., Inc, et al.,
case no. H-02-0866," in the U.S. District Court for the
Southern District of Texas;
-- "Richard Picard et al. v. Cornell Cos., Inc., et al.,
case no. H-02-1075," in the U.S. District Court for the
Southern District of Texas;
-- "Louis A. Daly et al. v. Cornell Companies, Inc., et
al., case No. H-02-1522," in the U.S. District Court
for the Southern District of Texas; and
-- "Anthony J. Scolaro et al. v. Cornell Cos., Inc., et
al., case No. H-02-1567," in the U.S. District Court for
the Southern District of Texas.
The lawsuits were putative class actions brought on behalf of
all purchasers of the company's common stock between March 6,
2001 and March 5, 2002 and relate to the company's restatement
in 2002 of certain financial statements.
The lawsuits involved disclosures made concerning two prior
transactions executed by the company:
-- the August 2001 sale-leaseback transaction, and
-- the 2000 synthetic lease transaction.
These four lawsuits were consolidated into the Graydon Williams
action and Flyline Partners, LP was appointed lead plaintiff.
As a result, Flyline Partners, LP, filed a consolidated
complaint. Richard Picard and Anthony Scolaro were also named
as plaintiffs.
Since then, the court allowed plaintiffs to file an amended
consolidated complaint. The amended consolidated complaint
alleges that the defendants violated Section 10(b) of the U.S.
Securities Exchange Act of 1934, Rule 10b-5 promulgated under
Section 10(b) of the U.S. Exchange Act, Section 20(a) of the
Exchange Act, Section 11 of the U.S. Securities Act of 1933
and/or Section 15 of the U.S. Securities Act.
The amended consolidated complaint seeks, among other things,
restitution damages, compensatory damages, rescission or a
rescissory measure of damages, costs, expenses, attorneys' fees
and expert fees.
In an order entered April 1, 2005, the court granted the motion
to dismiss with respect to the plaintiffs' securities fraud
claims pursuant to Sections 10(b) and 20(a) of the Exchange Act
and Rule 10b-5. The court denied the motion to dismiss as to
the remaining claims covering the company's secondary offering
in 2001.
Parties agreed to settle this matter. Under the proposed
agreement, the company has not admitted any wrongdoing.
Settlement in the amount of $7 million will be funded through
the company's directors' and officers' liability insurance.
During the fourth quarter of 2005, the company recorded the
settlement charge of $7.0 million and the related reimbursement
of $7.0 million from the director's and officer's liability
insurance.
In February 2006, the court approved the settlement of this
matter. Funds were disbursed from the trust account to
plaintiffs' counsel's escrow account upon court approval of the
settlement in February 2006.
The suit is "Williams, et al. v. Cornell Cos., et al., Case No.
4:02-cv-00866," filed in the U.S. District Court for the
Southern District of Texas under Judge Vanessa D. Gilmore.
Representing the plaintiffs are:
(1) Roger B. Greenberg of Schwartz Junell, et al., 909
Fannin, Ste. 2700, Houston, TX 77010, Phone: 713-752-
0017, Fax: 713-752-0327, E-mail:
rgreenberg@schwartz- junell.com; and
(2) Thomas E. Bilek of Hoeffner and Bilek, LLP, 1000
Louisiana, Suite 1302, Houston, TX 77002, Phone: 713-
227-7720, Fax: 713-227-9404, E-mail:
tbilek@hb-legal.com.
Representing the defendants are:
(i) Paul R. Bessette of Akin Gump, et al., 300 W. 6th St.,
Ste. 2100, Austin, TX 78746, Phone: 512-499-6200, Fax:
512-499-6290, E-mail: pbessette@akingump.com; and
(ii) Timothy R. McCormick of Thompson & Knight, Ste. 3300,
1700 Pacific St., Dallas, TX 75201, Phone: 214-969-
1103, Fax: 214-880-3253, E-mail:
timothy.mccormick@tklaw.com.
CORNELL COMPANIES: Settles N.Mex. Strip Search Suit for $1.6M
-------------------------------------------------------------
Cornell Companies, Inc. reached an estimated $1.6 million
settlement in a purported class action filed by a detainee at
the Lincoln County Detention Center in the U.S. District Court
of New Mexico in Santa Fe.
The lawsuit relates to the former LCDC policy that required
strip searches for all detainees and inmates and alleges that
such policy violates a detainee's Fourth Amendment right.
It was filed as a putative class action brought on behalf of all
inmates who were searched at the facility, which was acquired by
the company, from May 2002 to July 2005.
In September 2006, the company agreed to a proposed stipulation
of settlement, which is subject to the approval of the court,
will resolve this action.
The settlement amount under the terms of this agreement is $1.6
million, and will be funded principally through our general
liability and professional liability coverage, according to
company's Nov. 9, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the period ended Sept. 30, 2006.
Cornell Companies, Inc. on the Net:
http://www.cornellcompanies.com/.
CORPORATE LIBRARY: Report Lists Firms Likely to Face Stock Suits
----------------------------------------------------------------
The Corporate Library, a corporate governance research firm,
recently released a report identifying the most likely as well
as the least likely public companies to face securities class
actions (SCAs) within the next 18 months, according to Pensions
& Investments Online.
BellSouth Corp., Abbott Laboratories and Wyeth are the largest
companies, in terms of market capitalization, are most likely to
face securities class actions over the next 18 months, according
to a report.
On the other hand, the largest firms least likely to face a
lawsuit are Mosaic Co., Weight Watchers International Inc. and
Titanium Metals Corp.
In all, the Corporate Library identified 75 companies most
likely to face lawsuits and 50 others that were least likely.
The predictions were based on newly developed screens that draw
upon governance and performance data. The new analysis
identifies six key factors, which in combination with
performance fundamentals such as share price volatility and
leverage provide a reliable tool for assessing the probability
of SCAs (Class Action Reporter, Dec. 1, 2006).
The key factors are:
-- Excessive CEO compensation,
-- Director age, tenure, over-commitment, and lack of
independence,
-- Institutional owners,
-- Industry-specific risk,
-- Company size, and
-- Share trading volume,
The study contains suggestions for reducing the risk, such as
trimming excessive CEO compensation. "Excessive CEO pay remains
the single most statistically significant governance indicator
of (securities class action) risk," the report said.
The full report can be purchased from The Corporate Library's
online store: http://www.thecorporatelibrary.com.
DISCOVERY LABORATORIES: Plaintiffs File Second Amended Complaint
----------------------------------------------------------------
The law firm Chimicles & Tikellis, LLP, filed a second
consolidated amended complaint in the U.S. District Court for
the Eastern District of Pennsylvania for the consolidated
securities fraud class action against Discovery Laboratories,
Inc. and two of its executive officers.
This complaint alleges claims under Sections 10(b) and 20(a) of
the U.S. Securities Exchange Act of 1934 and Rule 10b-5 against
Discovery Labs, Robert J. Capetola, its Chief Executive Officer
and Christopher J. Schaber, its former Chief Operating Officer.
The second consolidated amended complaint is brought on behalf
of a proposed class, which is defined as all persons who
purchased common stock of Discovery Labs between March 15, 2004
and June 6, 2006.
Excluded from the class are defendants, members of their
families, and the directors and officers of Discovery Labs and
its subsidiaries.
On May 1, 2006, Hal Unschuld, filed an action in the U.S.
District Court for the Eastern District of Pennsylvania,
individually and purportedly on behalf of a class of the
company's investors who purchased its publicly traded securities
between Dec. 28, 2005 and April 25, 2006 (Class Action Reporter,
June 15, 2006).
The suit was filed against the company and the company's Chief
Executive Officer, Robert J. Capetola. This action alleges
violations of Section 10(b) of the U.S. Securities Exchange Act
of 1934, Rule 10b-5 promulgated thereunder and Section 20(a) of
the Exchange Act in connection with various public statements
made by the company.
Plaintiff seeks an order wherein the suit may proceed as a class
action and an award of compensatory damages in favor of the
plaintiff and the other class members in an unspecified amount,
together with interest and reimbursement of costs and expenses
of the litigation and other equitable or injunctive relief.
The company was notified that two additional class actions
seeking the same relief have since been filed in the U.S.
District Court for the Eastern District of Pennsylvania,
although the company has not been served with a complaint in
these actions.
On July 25, 2006, the U.S. District Court for the Eastern
District of Pennsylvania issued an order appointing the Mizla
Group, as lead plaintiff in "In re Discovery Laboratories
Securities Litigation, No. 06-1820 (SD)."
The court also approved the appointment of Chimicles & Tikellis
LLP as lead counsel. The court directed that a consolidated
amended complaint be filed, and on Aug. 10, 2006, the company
filed the consolidated amended complaint.
On Sept. 14, 2006, the defendants filed a motion to dismiss the
consolidated amended complaint, and, in an order dated November
1, 2006, the district court granted that motion while giving
plaintiffs leave to file an amended complaint.
On Nov. 30, 2006, the company filed the second consolidated
amended complaint (Class Action Reporter, Nov. 8, 2006).
A copy of the second consolidated amended complaint is available
free of charge at: http://ResearchArchives.com/t/s?1656.
The suit is "In re Discovery Laboratories Securities Litigation,
Case No. 2:06-cv-01820-SD," filed in the U.S. District Court for
the Eastern District of Pennsylvania under Judge Stewart
Dalzell.
Representing plaintiffs are James R. Malone and Joseph G. Sauder
both of Chimicles & Tikellis LLP, 361 West Lancaster Avenue,
Haverford, PA 19401, Phone: 610-642-8500, E-mail:
jamesmalone@chimicles.com or josephsauder@chimicles.com.
Representing defendants are Michelle M. Crimaldi, Robert L.
Hickok, Christopher J. Huber and Gay Barlow Parks Rainville all
of Pepper Hamilton LLP, 3000 Two Logan Square, 18th and Arch
Streets, Philadelphia, PA 19103-2799, Phone: 215-981-4000 or
215-981-4583 or 215-981-4446, Fax: 215-981-4750, E-mail:
crimaldim@pepperlaw.com or hickokr@pepperlaw.com or
huberc@pepperlaw.com or rainvilleg@pepperlaw.com.
EXPRESS FORESTRY: Reaches $220T Settlement for La. Workers' Suit
----------------------------------------------------------------
Express Forestry, Inc., settled a purported class action filed
in the U.S. District Court for the Eastern District of Louisiana
by a group of Guatemalan guest workers that sued over unpaid
wages.
Immigrant Justice Project (IJP) of the Southern Poverty Law
Center filed the suit, "Hugo Martin Recinos-Recinos, et al. v.
Express Forestry Inc., et al.," on April 7, 2005 against company
and its officers Rick and Sandy Thomas.
They brought it on behalf of migrant agricultural workers who
were legally admitted to the U.S. to work under a temporary
foreign worker visa program.
The three named plaintiffs in the suit, which was granted class
action status back in February, are:
-- Hugo Martin Recinos-Recinos,
-- Pablo Recinos-Alvarado, and
-- Alberto Alvarado.
Under the settlement, Express Forestry will pay $220,000,
according to Mary C. Bauer, an attorney with the IJP, which
represents the workers.
The $220,000 amount should be paid to three groups:
-- the three original named plaintiffs in the case,
-- 46 "opt-in" plaintiffs who joined the litigation, and
-- as many as 300 class members who worked for Express
Forestry between April 1999 and April 2005.
Ms. Bauer added that $135,000 would go to the 49 people who
actively participated in the case and $75,000 would be
distributed among the class members.
The suit is "Hugo Martin Recinos-Recinos, et al. v. Express
Forestry Inc., et al., Case No. 05-1355," filed in the U. S.
District Court for the Eastern District of Louisiana under Judge
Lance M. Africk with referral to Judge Daniel E. Knowles.
Representing plaintiffs is Mary C. Bauer of the Immigrant
Justice Project Southern Poverty Law Center, 400 Washington
Avenue, Montgomery, AL 36104, Phone: 334-956-8200, E-mail:
mbauer@splcenter.org.
Representing the defendants is Elizabeth K. Dorminey of
Wimberly, Lawson, Steckel & Schneider, P.C., Lenox Towers,
3400 Peachtree Rd., N.E., Suite 400, Atlanta, GA 30326, Phone:
404-365-0900, E-mail: bdorminy@bellsouth.net.
FAMILY DOLLAR: N.C. Backdating Stock Options Suits Consolidated
---------------------------------------------------------------
North Carolina's Mecklenburg County Superior Court consolidated
a pair of class actions, accusing Family Dollar Stores Inc. of
backdating options to benefit its top executives, the Charlotte
Business Journal reports.
State Judge Albert Diaz has combined cases filed in August by
Rebecca Mitchell and in October by Jeffrey Alasina into a single
case for trial.
Early this year, ten Family Dollar officials and directors,
including its chief financial officer, were sued by a
shareholder, accusing them of improperly earning millions of
dollars from exercising backdated stock options between 1995 and
2000.
The suit says the company's stock price rose after the reported
date of many grants "in a striking pattern that could not have
been the result of chance."
The complaint reportedly asserts that the options were issued
just before a "substantial rise" in Family Dollar stock.
Lead counsel is Schiffrin & Barroway, 280 King of Prussia Road
Radnor, PA 19087, Phone: 610-667-7706, Fax: 610-667-7056, E-
mail: info@sbclasslaw.com or infosb@sbclasslaw.com, Website:
http://www.sbclasslaw.com.
Representing Family Dollar is the law firm Hunton & Williams,
Bank of America Plaza, Suite 3500, 101 South Tryon Street,
Charlotte, North Carolina 28280, Phone: (704) 378-4700, Fax:
(704) 378-4890, Website: http://www.hunton.com.
GUITAR CENTER: Continues to Face RICO Suit Over Fla. Operations
---------------------------------------------------------------
Guitar Center, Inc. and its chief executive officer remain
defendants in a purported class action filed in the U.S.
District Court for the Southern District of Florida that alleges
violations of the Racketeering Influenced and Corrupt
Organization Act, several antitrust laws and trade practices,
according to company's Nov. 9, 2006 Form 10-Q filing with the
U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
On Nov. 29, 2005, a case was filed against company and other
defendants, including its chief executive officer. The
complaint specifically asserts violations of:
-- RICO and a corresponding Florida statute,
-- Sections 1 and 2 of the Sherman Antitrust Act,
-- Section 2 of the Clayton Act (as amended by the
Robinson-Patman Act),
-- the Antidumping Act of 1916,
-- the Florida Antitrust Act of 1980, and
-- the Florida Deceptive and Unfair Trade Practices Act;
and
-- tortious interference with business relationship under
Florida law and civil conspiracy under Florida law.
The violations are in connection with the claimed inability of
Ace Pro Sound and Recording, L.L.C. to obtain vendor lines for
its store.
The complaint purports to be a class action on behalf of all
current and former retail sellers of musical instruments and/or
sound equipment and/or recording equipment with stores located
in geographical regions in the U.S. wherein some or all of the
defendants have carried on business, and seeks compensatory
damages, treble damages, punitive damages, injunctive relief and
attorneys' fees.
On March 6, 2006, defendants, jointly and separately, filed
responsive pleadings comprised of four motions to dismiss and a
motion to strike.
On or about March 21, 2006, plaintiff sought leave of the court
to file an amended complaint, which was granted by the court.
Plaintiff filed the amended complaint on April 10, 2006.
The amended complaint abandoned an alleged violation of the
Antidumping Act of 1916, and now asserts, among other things,
additional common law violations.
The suit is "Ace Pro Sound and v. Albertson, et al., Case No.
05-CV-23098," filed in the U.S. District Court for the Southern
District of Florida under Judge Marcia G. Cooke.
Representing the plaintiffs is Michael L. Feinstein of Michael
L. Feinstein, P.A., 888 East Las Olas Boulevard, Suite 700, Fort
Lauderdale, Florida 33301, (Broward Co.), Phone: 954-767-9662,
Fax: 954-527-0848.
Representing the company is Douglas E. Ede of The Law Offices of
Salas, Ede, Peterson & Lage, L.L.C., 6333 Sunset Drive, Miami,
Florida 33143, Phone: (305) 663-0000, Fax: (305) 663-0989, E-
mail: dede@sepllaw.com, Web site: http://www.sepllaw.com.
GUITAR CENTER: Reaches $2.9M Settlement for Calif. Labor Suits
--------------------------------------------------------------
The Los Angeles County Superior Court granted final approval to
the settlement of two purported class actions against Guitar
Center, Inc., that accuses it of failing to document and enforce
break-time and lunchtime periods for hourly retail store
employees in the State of California.
On Oct. 13, 2004, a putative class action entitled "Carlos
Rodriguez v. The Guitar Center, Inc. [sic], Case No. GC322958,"
was filed in the Los Angeles County Superior Court on behalf of
all hourly retail store employees within the State of California
(Class Action Reporter, Dec. 20, 2005).
On Dec. 15, 2004, a putative class action, "James McClain et al.
v. Guitar Center Stores, Inc., Case No. BC326002," was filed in
the same court on behalf of all hourly retail store employees
within the State of California. Among others, the lawsuits
allege that the company improperly failed to document and
enforce break-time and lunchtime periods for such employees.
The suit sought an unspecified amount of damages, penalties and
attorneys' fees (Class Action Reporter, Dec. 20, 2005).
In March 2006, the court granted its preliminary approval of the
proposed class settlement that the company had reached with the
other parties on Dec. 15, 2005.
In July 2006, the court approved a final class action
settlement. Pursuant to the settlement, the company made
payments to the class members in October 2006 of approximately
$2.9 million to fully resolve claims by eligible class members,
according to company's Nov. 9, 2006 Form 10-Q filing with the
U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
The settlement will fully resolve claims by eligible class
members, including payments to class members and payments for
plaintiff attorneys' fees and the costs of a third-party
administrator.
Guitar Center, Inc. in the Net: http://www.guitarcenter.com/.
ISOLAGEN INC: Seeks Dismissal of Consolidated Stock Suit in Pa.
---------------------------------------------------------------
Isolagen, Inc. filed a motion with the U.S. District Court for
the Eastern District of Pennsylvania that seeks to dismiss the
consolidated securities class action filed against the company.
Initially, the company and certain of its current and former
officers and directors were named as defendants in several
purported securities class action cases in federal district
courts in Texas and Pennsylvania.
On Aug. 18, 2005, Elliot Liff brought an action, "Elliot Liff v.
Isolagen, Inc. et al., C.A. No. H-05-2887," in the U.S. District
Court for the Southern District of Texas.
In this action, the plaintiff purports to bring a federal
securities fraud class action on behalf of purchasers of the
publicly traded securities of the company between March 3, 2004
and Aug. 1, 2005, including purchasers of Isolagen stock issued
in connection with and traceable to the company's June 2004
common stock offering.
The action asserts that the defendants violated Section 10(b) of
the Exchange Act and Rule 10b-5 by making certain false
statements and omissions to the investing public regarding the
company's business operations, management, and intrinsic value
of Isolagen's publicly traded securities. It also alleges
liability against the individual defendants under Section 20(a)
of the Exchange Act.
Subsequent cases filed against the company are:
-- "Michael Cummisky v. Isolagen, Inc. et al., C.A. No. 05-
cv-03105," in the U.S. District Court for the Southern
District of Texas filed on Sept. 6, 2005;
-- "Ronald A. Gargiulo v. Isolagen, Inc. et al., C.A. No.
05-cv-4983," in the U.S. District Court for the Eastern
District of Pennsylvania filed on Sept. 16, 2005; and
-- "Gregory J. Newman v. Frank M. DeLape, et al., C.A. No.
05-cv-5090," in the U.S, District Court for the Eastern
District of Pennsylvania filed on Sept. 23, 2005.
These actions make allegations against the defendants
substantially similar to those made in the Liff action.
Together, the Liff, Cummiskey, Gargiulo and Newman actions
comprise the "Federal Securities Actions."
The Liff and Cummiskey actions were consolidated on Oct. 7,
2005. The Gargiolo and Newman actions were consolidated on Nov.
29, 2005.
On Nov. 18, 2005, the company filed a motion with the Judicial
Panel on Multidistrict Litigation to transfer the Federal
Securities Actions plus a derivative action to the U.S. District
Court for the Eastern District of Pennsylvania.
The Liff and Cummiskey actions were stayed on Nov. 23, 2005
pending resolution of the MDL Motion. The Gargiulo and Newman
actions were stayed on Dec. 7, 2005 pending resolution of the
MDL Motion.
The MDL Motion was heard on Jan. 7, 2006 and a ruling was issued
on Feb. 23, 2006 transferring the actions pending in the
Southern District of Texas to the Eastern District of
Pennsylvania.
On April 4, 2006, the court appointed as lead plaintiffs:
-- Silverback Asset Management, LLC,
-- Silverback Master, Ltd.,
-- Silverback Life Sciences Master Fund, Ltd.,
-- Context Capital Management, LLC
-- Michael F. McNulty.
It also appointed as lead counsel in the Federal Securities
Actions, the law firms of Bernstein Litowitz Berger & Grossman
LLP and Kirby McInerney & Squire LLP.
On July 14, 2006, lead plaintiffs filed a consolidated class
action complaint in the federal securities litigation on behalf
of a putative class of persons or entities who purchased or
otherwise acquired Isolagen common stock or convertible debt
securities between March 3, 2004 and Aug. 9, 2005.
The complaint purports to assert claims for securities fraud in
violation of Sections 10(b) and 20(a) of the U.S. Securities
Exchange Act of 1934 against Isolagen and certain of its former
officers and directors.
It also purports to assert claims for violations of Section 11
and 12 of the Securities Act of 1933 against the company and
certain of its current and former directors and officers in
connection with the registration and sale of certain shares of
Isolagen common stock and certain convertible debt securities.
The complaint also purports to assert claims against the
followiung, as underwriters in connection with an April 2004
public offering of Isolagen common stock and a 2005 sale of
convertible notes:
-- CIBC World Markets Corp.,
-- Legg Mason Wood Walker, Inc.,
-- Canaccord Adams, Inc., and
-- UBS Securities, LLC.
On Nov. 1, 2006, the defendants moved to dismiss the complaint,
according to Isolagen's Nov. 8, 2006 Form 10-Q filing with the
U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
The suit is "Isolagen, Inc., Securities & Derivative Litigation,
Case No. 2:06-md-01741-RB," filed in the U.S. District Court for
the Eastern District of Pennsylvania under Judge Ronald L.
Buckwalter.
Representing the plaintiffs are:
(1) Richard Eugene Norman of Crowley Douglas, et al., 1301
McKinney, Suite 3500, Houston, TX 77010, US, Phone:
713-651-1771;
(2) Andrei V. Rado and Peter E. Seidman of Milberg Weiss
Bershad & Schulman, LLP, One Pennsylvania Plaza, New
York, NY 10119-0165, Phone: 212-594-5300;
(3) Evan J. Smith of Brodsky & Smith, LLC, Two Bala Plaza,
Suite 602, Bala Cynwyd, PA 19004, Phone: 610-667-6200,
E-mail: esmith@brodsky-smith.com;
(4) R. Tyler Tomlinson of Liederbach Hahn Foy Van Blunk &
Thompson, PC, 892 Second Street Pike, Suite C,
Richboro, PA 18954, Phone: 215-322-8300; and
(5) Marc S. Henzel of The Law Offices Of Marc s. Henzel,
273 Montgomery Avenue, Suite 202, Bala Cynwyd, PA
19004, Phone: 610-660-8000, E-mail: mhenzel182@aol.com.
Representing the company are:
(i) Charles W. Schwartz of Skadden Arps, et al., 1000
Louisiana St., Suite 6800, Houston, TX 77002, US,
Phone: 713-655-5160; and
(ii) Robert W. Hayes of Cozen O'Connor, 1900 Market Street,
Philadelphia, PA 19103, Phone: 215-665-2094, Fax: 215-
665-2013, E-mail: rhayes@cozen.com.
JP MORGAN: N.Y. Judge Allows Plaintiffs' Claims to Proceed
----------------------------------------------------------
Judge Harold Baer, Jr. of the U.S. District Court for the
Southern District of New York upheld the plaintiffs' claim in
the class action "In re J.P. Morgan Chase Cash Balance
Litigation," that the JPMorgan Chase & Co. (JPM) "cash balance"
formula pension plan discriminates based on age, in violation of
the Employee Retirement Income Security Act (ERISA), allowing
plaintiffs' claim to proceed.
The JPMorgan Chase & Co., et al. Consolidated ERISA Complaint
was filed in the United States District Court for the Southern
District of New York on June 23, 2006 on behalf of Plaintiffs
and a class of all persons who were participants in the JPMorgan
Chase Retirement Plan and all predecessor and successor cash
balance plans, at any time after Jan. 1, 1997 whose accrued or
pension benefits are based, in whole or in part, on the Plan's
cash balance formula.
The consolidated complaint alleges that during the class period,
the defendants violated ERISA protections by:
-- causing the rate of benefit accrual to decrease because
of the age of or attainment of any age by participants;
-- failing to provide adequate notice to participants of
the impact on benefits caused by the conversion to a
cash balance formula;
-- failing to fully disclose Plan provisions in the Summary
Plan Descriptions provided to participants; and
-- failing to provide participants with the required
Summaries of Material Modifications to the terms of the
Plan.
The merged plans include cash balance plans formerly maintained
by:
-- Bank One Corp.;
-- Chase Manhattan Bank;
-- Chemical Bank;
-- First Chicago NBD Corp.;
-- First USA Bank; and
-- Morgan Guaranty Trust Company of New York.
On Oct. 30, 2006, Judge Baer, issued an opinion on Defendants'
motion to dismiss. Judge Baer denied defendants' motion to
dismiss Count I of the complaint, the age discrimination claim,
as well as Counts IV-VI, the notice claims.
The Court dismissed Counts II-III of the complaint based on
Plaintiffs' agreement to withdraw those claims without prejudice
pending discovery.
The opinion allows Plaintiffs to pursue their core claims
against defendants - namely that the JP Morgan/Chase Cash
Balance Plan discriminated against older workers, and, that JP
Morgan/Chase failed to provide adequate notice with respect to
the Cash Balance Plan as required by ERISA
JPMorgan Chase ERISA Litigation on the net:
http://www.erisafraud.com./Default.aspx?tabid=1241
The consolidated suit is "In re J.P. Morgan Chase Cash Balance
Litigation, Case No. 1:06-cv-00732-HB," filed in the U.S.
District Court for the Southern District of New York under Judge
Harold Baer, Jr.
Representing plaintiffs are:
(1) Derek W. Loeser, Erin M. Riley, Lynn Lincoln Sarko and
Amy C. Williams-Derry all of Keller Rohrback L.L.P.
(WA), 1201 3rd Avenue, Suite 3200, Seattle, WA 98101,
Phone: (206) 224-7562 or (206) 623-1900 or (206) 224-
7552 or (206)-623-1900, Fax: (206) 623-3384, E-mail:
dloeser@kellerrohrback.com or eriley@kellerrohrback.com
or lsarko@kellerrohrback.com or
awilliams-derry@kellerrohrback.com;
(2) Richard S. Schiffrin, Edward W. Ciolko, Joseph H.
Meltzer and Joseph A. Weeden all of Schiffrin &
Barroway L.L.P., 280 King of Prussia Road, Radnor, PA
19087, Phone: (610) 667-7706; and
(3) Peter S Linden and Andrew Thomas Watt both of Kirby
McInerney & Squire, LLP, 830 Third Avenue, 10th Floor,
New York, NY 10022, Phone: (212) 371-6600 or (212) 699-
1190, Fax: (212) 751-2540, E-mail: plinden@kmslaw.com
or awatt@kmslaw.com.
L-1 IDENTITY: Seeks Dismissal of Mass. Consolidated Stock Suit
--------------------------------------------------------------
L-1 Identity Solutions, Inc. (formerly known as Viisage
Technology, Inc.) asked the U.S. District Court for the District
of Massachusetts to dismiss a consolidated securities fraud
class action filed against it and several other defendant.
Between March and April 2005, eight putative class actions were
filed against L-1, Mr. Bernard C. Bailey, Mr. William K. Aulet
(the company's former Chief Financial Officer) and Mr. Denis K.
Berube and other members of the Board of Directors of Viisage
Technology, Inc.
These lawsuits have been consolidated into one action under, "In
Re Viisage Technology Securities Litigation, Civil Action No.
05-10438-MLW.
The so-called Turnberry Group has been designated as lead
plaintiff and its counsel has been designated as lead counsel.
The amended consolidated complaint which was filed in February
2006 alleges violations of the federal securities laws by
Viisage (now named L-1 Identity Solutions, Inc.) and certain
officers and directors arising out of purported misstatements
and omissions in Viisage's SEC filings related to certain
litigation involving the Georgia drivers' license contract and
related to the Viisage's reported material weaknesses in
internal controls over financial reporting, which allegedly
artificially inflated the price of the company's stock during
the period May 12, 2004 through March 2, 2005.
In April 2006, the company filed a motion to dismiss this case,
according to company's Nov. 8, 2006 Form 10-Q filing with the
U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
The suit is "In re: Viisage Technology Securities Litigation,
Civil Action No. 05-10438-MLW," filed in the U.S. District Court
for the District of Massachusetts.
Representing the plaintiffs are:
(1) Theodore M. Hess-Mahan of Shapiro Haber & Urmy, LLP, 53
State Street, Boston, MA 02108, Phone: 617-439-3939,
Fax: 617-439-0134, E-mail: ted@shulaw.com;
(2) Alan L. Kovacs of Law Office of Alan L. Kovacs, 2001
Beacon Street, Suite 106, Boston, MA 02135, Phone: 617-
964-1177, Fax: 617-332-1223, E-mail:
alankovacs@yahoo.com; and
(3) Jeffrey C. Block and Leslie R. Stern of Berman
DeValerio Pease Tabacco Burt & Pucillo, One Liberty
Square, 8th Floor, Boston, MA 02109, Phone: 617-542-
8300, Fax: 617-542-1194 and 617-542-1154, E-mail:
jblock@bermanesq.com and lstern@bermanesq.com.
Representing the defendants is Mitchell H. Kaplan of Choate,
Hall & Stewart, Two International Place, 100-150 Oliver Street,
Boston, MA 02110, Phone: 617-248-5000, Fax: 617-248-4000, E-
mail: mkaplan@choate.com.
MORTGAGEIT HOLDINGS: Dec. Hearing Set for N.Y. Stockholder Suit
---------------------------------------------------------------
The Supreme Court of the State of New York in New York County
will hold a fairness hearing on Dec. 11, 2006 at 9:30 a.m. for
the proposed settlement of the matter, "Pressner v. MortgageIT
Holdings, Inc., et al., Case No. 602472/06."
The hearing will be held in Room 232 at the Supreme Court of the
State of New York, New York County Courthouse, 60 Center St.,
New York, N.Y. 10007.
The settlement covers all record and beneficial holders of
MortgageIT Holdings, Inc. common stock from July 24, 2006
through effective date of the merger agreement defined below.
Case Background
On July 13, 2006, as amended on Sept. 15, 2006, Jerry Pressner,
a purported stockholder of MortgageIT Holdings, Inc., filed the
complaint against the company and seven of its eight directors.
The complaint alleged, among other things, that the directors of
the company breached their fiduciary duties by failing to
maximize stockholder value with regard to the proposed merger of
the company with Titan Acquisition Corp., an indirect wholly-
owned subsidiary of DB Structured Products, Inc., which in turn
is a wholly-owned subsidiary of Deutsche Bank A.G., which
proposed merger was publicly announced on July 12, 2006.
Among other things, the complaint sought class action status, a
court order enjoining the company and its directors from
proceeding with or consummating the merger, and the payment of
attorneys' fees and expenses.
For more details, contact Gregory M. Nespole of Wolf Haldenstein
Adler Freeman & Herz, 270 Madison Avenue, New York, New York
10016, Phone: 212-545-4657, Fax: 212-545-4758, Web site:
http://www.whafh.com.
NEW YORK: Consolidated Securities Suit Over Merger Dismissed
------------------------------------------------------------
The U.S. District Court for the Eastern District of New York
dismissed in its entirety a consolidated securities class action
filed against New York Community Bancorp, Inc. in relation to
its merger with Roslyn Bancorp, Inc.
In 2004, the company and various executive officers and
directors were named in certain putative securities law class
actions brought in the U.S. District Court for the Eastern
District of New York, and one class action brought in the
Supreme Court of the State of New York, Kings County, that was
later removed by the defendants to federal court.
On Aug. 9, 2005, the court consolidated the actions and
appointed a Lead Plaintiff.
On Oct. 6, 2005, the lead plaintiff filed a consolidated amended
complaint on behalf of a putative class of persons and entities,
other than defendants, who purchased or otherwise acquired the
company's securities from June 27, 2003 to July 1, 2004.
That suit is alleging claims under Sections 11 and 12 of the
Securities Act of 1933, Sections 10 and 14 of the U.S.
Securities Exchange Act of 1934, and Rule 10b-5, promulgated
pursuant to Section 10 of the U.S. Securities Exchange Act of
1934.
Plaintiffs allege, among other things, that the Registration
Statement issued in connection with the company's merger with
Roslyn Bancorp and other documents and statements made by
executive management were inaccurate and misleading, contained
untrue statements of material facts, omitted other facts
necessary to make the statements made not misleading, and
concealed and failed to adequately disclose material facts,
pertaining to, among other things, the company's business plans
and its exposure to interest rate risk.
Defendants moved to dismiss the action on Dec. 19, 2005.
On Sept. 18, 2006, the court entered a memorandum of decision
and order dismissing the consolidated action in its entirety,
finding that the amended complaint failed to allege any
actionable misstatement or omission.
On Oct. 4, 2006, the plaintiffs filed a motion for
reconsideration of that order insofar as it denied plaintiffs'
leave to amend. That motion remains pending, according to the
company's Nov. 9 form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended Sept. 30, 2006.
The first identified complaint is "Toby Olsen, et al. v. New
York Community Bancorp, Inc., et al., Case No. 04-CV-4165,"
filed in the U.S. District Court for the Eastern District of New
York.
Plaintiff firms in this litigation are:
(1) Charles J. Piven, World Trade Center-Baltimore,401 East
Pratt Suite 2525, Baltimore, MD, 21202, Phone:
410.332.0030, E-mail: pivenlaw@erols.com;
(2) Murray, Frank & Sailer LLP, 275 Madison Ave 34th Flr,
New York, NY, 10016, Phone: 212.682.1818, Fax:
212.682.1892, E-mail: email@rabinlaw.com;
(3) Schatz & Nobel, P.C., 330 Main Street, Hartford, CT,
06106, Phone: 800.797.5499, Fax: 860.493.6290, E-mail:
sn06106@AOL.com; and
(4) Schiffrin & Barroway, LLP, 3 Bala Plaza E, Bala Cynwyd,
PA, 19004, Phone: 610.667.7706, Fax: 610.667.7056, E-
mail: info@sbclasslaw.com.
O MAGAZINE: Disgruntled Subscriber Files Double-Billing Lawsuit
---------------------------------------------------------------
Linda Hall, a disgruntled "O" magazine subscriber filed a
lawsuit, claiming she was double billed for her magazine
subscription, Eurweb.com reports.
Named in the suit are:
-- O Magazine,
-- Hearst Corp., and
-- Hearst Magazines.
The suit claims that Ms. Hall ordered two one-year subscriptions
in December 2005, which she had paid in full the same month she
ordered them.
In April 2006, Ms. Hall claimed she received a letter from
Hearst Magazine, informing her she was "past due" and threatened
that if she did not pay for the subscriptions, her credit
standing would be put "at risk."
Nevertheless, Ms. Hall paid the invoice even though she had
already paid for the magazines.
She alleges the letter and invoice she received "are part of a
nationwide scheme and artifice designed and implemented by
defendants to trick, deceive and scare their subscribers into
paying money to defendants for subscriptions which subscribers
have already paid for in full."
The suit seeks compensatory and punitive damages, as well as an
injunction barring the alleged practice.
PLANTRONICS INC: Faces Lawsuits Over Headsets in Calif., Fla.
-------------------------------------------------------------
Three class action lawsuits were recently filed against
Plantronics Inc. alleging that its Bluetooth headsets may cause
noise-induced hearing loss.
The suits are:
-- "Lori Raines, et al. v. Plantronics, Inc.," filed on
Oct. 20, 2006 in the U.S. District Court for the
Central District of California;
-- "Kyle Edwards, et al. vs Plantronics, Inc.," filed on
Oct. 17, 2006 in the U.S. District Court for the Middle
District of Florida; and
-- "Schiller, et al. v. Plantronics, Inc.," filed on Oct.
10, 2006 in the Superior Court of the State of
California in and for the County of Los Angeles.
None of the complaints allege actual personal injury to any
individual. All three complaints seek various remedies,
including injunctive relief requiring Plantronics to include
certain additional warnings with its Bluetooth headsets and to
redesign the headsets to limit the volume produced, or,
alternatively, to provide the user with the ability to determine
the level of sound emitted from the headset.
Plaintiffs also seek unspecified general, special, and punitive
damages, as well as restitution.
The suit "Lori Raines v. Plantronics Inc et al., Case No. 2:06-
cv-06708-PA-JC," is before Judge Percy Anderson with referral to
Judge Jacqueline Chooljia.
Representing the plaintiff are:
(1) Stephen M. Garcia and Sarina M. Hinson at Garcia Law
Firm, One World Trade Center, Suite 1950, Long Beach,
CA 90831, Phone: 562-216-5270;
(2) Melissa M. Harnett, Wasserman Comden and Casselman,
5567 Reseda Boulevard, Suite 330, P.O. Box 7033,
Tarzana, CA 91357-7033, Phone: 818-705-6800; and
(3) Sarina M. Hinson at Garcia Law Firm, One World Trade
Center, Suite 1950, Long Beach, CA 90831, Phone: 562-
216-5271.
The suit "Edwards v. Plantronics Inc., Case No. 8:06-cv-01910-
SDM-TGW," is before Judge Steven D. Merryday with referral to
Thomas G. Wilson.
Representing the plaintiff are:
(1) Michael Jay Fuller, Jr. at McHugh Fuller Law Group, 97
Elias Whiddon Road, Hattiesburg, MS 39402, Phone:
601/261-2220, Fax: 601/261-2481, E-mail:
mike@mchughfuller.com;
(2) Stephen M. Garcia and Sarina M. Hinson at The Garcia
Law Firm, One World Trade Center, Suite 1950, Long
Beach, CA 39402, Phone: 800/281-8515, Fax: 562/216-
5271; and
(3) Melissa Harnett at Wasserman, Comden & Casselman, LLC,
5567 Reseda Blvd., Ste. 330, P.O. Box 7033, Tarzana, CA
91357-7033, Phone: 818/705-6800, Fax: 818/996-8266; and
PRICELINE.COM INC: Discovery Deadline in Conn. Suit Set Dec. 07
---------------------------------------------------------------
A Dec. 31, 2007 deadline has been set for the completion of
discovery in the consolidated suit filed against Priceline.com
Inc. in the U.S. District Court for the District of Connecticut.
Subsequent to the company's announcement on Sept. 27, 2000, that
revenues for the third quarter 2000 would not meet expectations,
it was served with these putative class action complaints:
-- "Weingarten v. priceline.com Incorporated and Jay S.
Walker, Case No. 3:00 CV 1901," (District of
Connecticut)
-- "Twardy v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1884," (District of Connecticut)
-- "Berdakina v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1902," (District of Connecticut)
-- "Mazzo v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1924," (District of Connecticut)
-- "Fialkov v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1954," (District of Connecticut)
-- "Ayach v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2062," (District of Connecticut)
-- "Zia v. priceline.com Inc., Richard S. Braddock, Daniel
H. Schulman and Jay S. Walker, Case No. 3:00 CV 1968,"
(District of Connecticut)
-- "Mazzo v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1980," (District of Connecticut)
-- "Bazag v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2122," (District of Connecticut)
-- "Breier v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2146," (District of Connecticut)
-- "Farzam et al. v. priceline.com Inc., Richard S.
Braddock, Daniel H. Schulman and Jay S. Walker, Case
No. 3:00 CV 2176," (District of Connecticut)
-- "Caswell v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2169," (District of Connecticut)
-- "Howard Gunty Profit Sharing Plan v. priceline.com Inc.
Richard S. Braddock, Daniel H. Schulman and Jay S.
Walker, Case No. 3:00 CV 1917," (District of
Connecticut)
-- "Cerelli v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1918," (District of Connecticut)
-- "Mayer v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1923," (District of Connecticut)
-- "Anish v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1948," (District of Connecticut)
-- "Atkin v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
1994," (District of Connecticut)
-- "Lyon v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2066," (District of Connecticut)
-- "Kwan v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2069," (District of Connecticut)
-- "Krim v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2083," (District of Connecticut)
-- "Karas v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2232," (District of Connecticut)
-- "Michols v. priceline.com Inc., Richard S. Braddock,
Daniel H. Schulman and Jay S. Walker, Case No. 3:00 CV
2280." (District of Connecticut)
All of these cases were assigned to Judge Dominic J. Squatrito.
On Sept. 12, 2001, Judge Squatrito ordered that these cases be
consolidated under the Master File No. 3:00cv1884 (DJS), and he
designated lead plaintiffs and lead plaintiffs' counsel.
On Oct. 29, 2001, plaintiffs served a consolidated amended
complaint. On Feb. 5, 2002, Amerindo Investment Advisors, Inc.,
who was one of the lead plaintiffs in the consolidated action,
made a motion for leave to withdraw as lead plaintiff.
The court granted that motion on May 30, 2002. On Feb. 28,
2002, the company filed a motion to dismiss the consolidated
amended complaint.
On Oct. 7, 2004, the court issued a memorandum of decision
granting, in part, and denying, in part, the company's motion.
The court entered a scheduling order on Nov. 2, 2004, and the
parties are now proceeding with discovery.
On Dec. 8, 2005, the court issued a memorandum of decision and
order stating that the Nov. 2, 2004 scheduling order would be
revised, but only after the parties have provided more details
about the status of discovery.
Plaintiffs filed a motion for class certification on Jan. 7,
2005 and the company filed its opposition to that motion. On
April 4, 2006, the court issued a memorandum of decision
granting, in part, and denying, in part, the plaintiffs' motion.
The court certified a class and approved five of the six
proposed class representatives. On May 4, 2006, the case was
transferred to Judge Christopher F. Droney.
Plaintiffs filed a motion for an order approving the proposed
notice of class certification on may 5, 2006 and the company
filed its response to that motion.
On May 18, 2006, the case was transferred to Judge Alfred V.
Covello. On Oct. 30, 2006, the court issued an order setting
forth a partial schedule, designating Dec. 31, 2007 as the
deadline for the completion of discovery.
The case is docketed as Master File No. 3:00cv1884 (DJS). It is
pending in the U.S. District Court of Connecticut under Judge
Christopher Droney.
PRICELINE.COM INC: Delaware Consumer Fraud Act Claims Dismissed
---------------------------------------------------------------
The Superior Court of the State of Delaware for New Castle
County has partially dismissed the class action, "Marshall, et
al. v. priceline.com, Inc."
On Feb. 17, 2005, Jeanne Marshall and three other individuals
filed the suit on behalf of themselves and a putative class of
allegedly similarly situated consumers.
The complaint alleged that the company violated the Delaware
Consumer Fraud Act, Del. Code Ann. Tit. 6, Section 2511, et
seq., relating to its disclosures and charges to customers to
cover taxes under city hotel occupancy tax ordinances
nationwide, and service fees.
The company moved to dismiss the complaint on April 21, 2005.
It also moved to stay discovery until a determination of its
motion to dismiss the complaint and the court granted that stay
on May 11, 2005.
On June 10, 2005, plaintiffs filed an amended complaint that
asserts claims under the Delaware Consumer Fraud Act and for
breach of contract and the implied duty of good faith and fair
dealing. The amended complaint seeks compensatory damages,
punitive damages, attorneys' fees and other relief.
On Oct. 31, 2006, the court granted in part and denied in part
the company's motion to dismiss. The court dismissed all claims
arising under the Delaware Consumer Fraud Act.
The court also dismissed all claims for breach of contract and
the implied duty of good faith and fair dealing that relate to
company's charges for service fees.
The court denied the company's motion to dismiss the breach of
contract and implied duty of good faith and fair dealing claims
as they relate to the company's charges to consumers to cover
taxes under city hotel occupancy tax ordinances.
PRICELINE.COM: No Ruling Yet in N.Y. Court IPO Suit Settlement
--------------------------------------------------------------
The U.S. District Court for the Southern District of New York
has yet to issue an order with respect to the final approval of
the settlement of the consolidated securities class action
against priceline.com, Inc., according to the company's Nov. 9,
2006 Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2006.
On March 16, March 26, April 27, and June 5, 2001, respectively,
four putative class action complaints were filed in the U.S.
District Court for the Southern District of New York naming
these defendants:
-- priceline.com, Inc.,
-- Richard S. Braddock,
-- Jay Walker,
-- Paul Francis,
-- Morgan Stanley Dean Witter & Co.,
-- Merrill Lynch,
-- Pierce,
-- Fenner & Smith, Inc.,
-- BancBoston Robertson Stephens, Inc. and
-- Salomon Smith Barney, Inc.
The suits are numbered, 01 Civ. 2261, 01 Civ. 2576, 01 Civ. 3590
and 01 Civ. 4956. "Shives et al. v. Bank of America Securities
LLC et al., 01 Civ. 4956," also names other defendants and
states claims unrelated to the company.
The complaints allege, among other things, that priceline.com
and the individual defendants violated the federal securities
laws by issuing and selling priceline.com common stock in
priceline.com's March 1999 initial public offering without
disclosing to investors that some of the underwriters in the
offering, including the lead underwriters, had allegedly
solicited and received excessive and undisclosed commissions
from certain investors.
By Orders of Judge Mukasey and Judge Scheindlin dated Aug. 8,
2001, these cases were consolidated for pre-trial purposes with
hundreds of other cases, which contain allegations concerning
the allocation of shares in the initial public offerings of
companies other than priceline.com, Inc. An order by Judge
Scheindlin dated Aug. 14, 2001 consolidated these cases for all
purposes: 01 Civ. 2261; 01 Civ. 2576; and 01 Civ. 3590.
On April 19, 2002, plaintiffs filed a consolidated amended class
action complaint in these cases. This consolidated amended
class action complaint makes similar allegations to those
described above but with respect to both the company's March
1999 initial public offering and the company's August 1999
second public offering of common stock.
The named defendants together with other issuer defendants in
the consolidated litigation, filed a joint motion to dismiss on
July 15, 2002.
Those who filed the motion are:
-- priceline.com, Inc.,
-- Richard S. Braddock,
-- Jay S. Walker,
-- Paul E. Francis,
-- Nancy B. Peretsman,
-- Timothy G. Brier,
-- Morgan Stanley Dean Witter & Co.,
-- Goldman Sachs & Co.,
-- Merrill Lynch,
-- Pierce, Fenner & Smith, Inc.,
-- Robertson Stephens, Inc. (as successor-in-interest to
BancBoston),
-- Credit Suisse First Boston Corp. (as successor-in-
interest to Donaldson Lufkin & Jenrette Securities
Corp.),
-- Allen & Co., Inc. and Salomon Smith Barney, Inc.
-- Priceline,
-- Richard Braddock,
-- Jay Walker,
-- Paul Francis,
-- Nancy Peretsman, and
-- Timothy Brier,
On Nov. 18, 2002, the cases against the individual defendants
were dismissed without prejudice and without costs. In
addition, counsel for plaintiffs and the individual defendants
executed Reservation of Rights and Tolling Agreements, which
toll the statutes of limitations on plaintiffs' claims against
those individuals.
On Feb. 19, 2003, Judge Scheindlin issued an opinion and order
granting in part and denying in part the issuer's motion. None
of the claims against the company were dismissed.
On June 26, 2003, counsel for the plaintiff class announced that
they and counsel for the issuers had agreed to the form of a
Memorandum of Understanding to settle claims against the
issuers.
The terms of that memorandum provide that the insurers of the
issuers will guarantee class members $1 billion in recoveries
and that settling issuer defendants will assign to the class
members certain claims that they may have against the
underwriters. Issuers also agree to limit their abilities to
bring certain claims against the underwriters.
If recoveries in excess of $1 billion are obtained by the class
from any non-settling defendants, the settling defendants'
monetary obligations to the class plaintiffs will be satisfied;
any amount recovered from the underwriters that is less than $1
billion will be paid by the insurers on behalf of the issuers.
A special committee of the priceline.com board of directors
approved the Memorandum, which is subject to the approval of
each issuer, on July 3, 2003. Thereafter, counsel for the
plaintiff class and counsel for the issuers agreed to the form
of a Stipulation and Agreement of Settlement with defendant
issuers and individuals.
The settlement agreement implements the Memorandum and contains
the same material provisions. On June 11, 2004, a special
committee of the priceline.com Board of Directors authorized the
company's counsel to execute the settlement agreement on behalf
of the company. The settlement agreement is subject to final
approval by the court and the process to obtain that approval is
still pending.
The suit is "In Re: Priceline.com IPO Securities Litigation,
1:01-cv-02261-SAS," filed in the U.S. District Court for the
Southern District of New York, under Judge Shira A. Scheindlin.
For more details, visit http://www.iposecuritieslitigation.com/.
PROGRESSIVE GAMING: Nev. Court Junks Some Claims in Stock Suit
--------------------------------------------------------------
The U.S. District Court for the District of Nevada partly
dismissed the consolidated securities class action filed against
Progressive Gaming International Corp.
Commencing on Nov. 28, 2005, four similar purported class action
complaints were filed in the U.S. District Court for the
District of Nevada naming the company and two of its officers as
defendants, and seeking unspecified money damages under Sections
10(b) and 20(a) of the U.S. Securities Exchange Act of 1934.
The complaints all alleged that during a "class period"
beginning in early 2005 and ending on Oct. 19, 2005, the
defendants misled the company's investors concerning the
prospective application of Statement of Financial Accounting
Standards 153 to company's financial statements for the third
quarter of 2005.
The complaints were consolidated into a single action, and an
amended complaint was filed on April 13, 2006. The amended
complaint added allegations that the registration statement
filed by us in connection with the acquisition of VirtGame Corp.
did not accurately represent the company's historical financial
results for the period from 2000 through the first quarter of
2005, and added a claim that the defendants violated Sections
11, 12(a)(2) and 15 of the Securities Act of 1933 in connection
with the registration Statement.
Defendants moved to dismiss the amended complaint, and on Sept.
1, 2006, the court issued an order granting the motion in part
and denying it in part.
The court dismissed, with leave to amend, the claims for
violation of Sections 10(b) and 20(a) of the Exchange Act and
Section 12(a)(2) of the Securities Act.
The court held that the claims for violation of Sections 11 and
15 of the Securities Act had been sufficiently pleaded and could
proceed. By agreement of the parties, pending court approval,
the time for plaintiffs to file an amended complaint was
extended to mid-November, 2006.
The case is at an early stage, no discovery has been conducted
and no trial date has been set, according to the company's Nov.
9 form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended Sept. 30.
The suit is "Paltronics, Inc. v. Mikohn Gaming Corp., Case No.
2:06-cv-01044-PMP-GWF," filed in U.S. District Court for the
District of Nevada under Judge Philip M. Pro with referral to
Judge George W Foley.
Representing plaintiff Paltronics, Inc. is Jahn & Associates
555 South Center Street, Reno, NV 89501, Phone: 775 329 2282,
Fax: 775 786 6631, E-mail: trademarks@kmjlaw.com.
Representing defendants Mikohn Gaming Corp. and Progressive
Gaming International Corp. are:
(1) Joshua Jessen at Gibson Dunn & Crutcher LLP, 1801
California Street, Denver, CO 80127, Phone: 303-298-
5726, E-mail: jjessen@gibsondunn.com; and
(2) J. Gregory Whitehair, 1801 California Street, 42nd
Floor, Denver, CO 80202, Phone: 303-298-5700, Fax: 303-
313-2845, E-mail: gwhitehair@gibsondunn.com.
TORCHMARK CORP: Court Voids Judgment in Cancer Policies Lawsuit
---------------------------------------------------------------
The Alabama Supreme Court voided a lower court final judgment in
the settlement of a consolidated class action over cancer
policies against Torchmark Corp. and National Life Insurance
Co., according to Torchmark's Nov. 8, 2006 Form 10-Q filing with
the U.S. Securities and Exchange Commission for the period ended
Sept. 30, 2006.
The companies were parties to purported class action, "Roberts
v. Liberty National Life Insurance Company, Case No. CV-2002-
009-B," filed in the Circuit Court of Choctaw County, Alabama on
behalf of all persons who currently or in the past were insured
under Liberty cancer policies, which were no longer being
marketed, regardless of whether the policies remained in force
or lapsed.
The case was based on allegations of breach of contract in the
implementation of premium rate increases, misrepresentation
regarding the premium rate increases, fraud and suppression
concerning the closed block of business and unjust enrichment.
On Dec. 30, 2003, the Alabama Supreme Court issued an opinion
granting Liberty's and Torchmark's petition for a writ of
mandamus, concluding that the Choctaw Circuit Court did not have
subject matter jurisdiction and ordering that Circuit Court to
dismiss the action.
Plaintiffs then filed their purported class action, "Roberts v.
Liberty National Life Insurance Company, Civil Action No. CV-03-
0137," against Liberty and Torchmark in the Circuit Court of
Barbour County, Alabama on Dec. 30, 2003.
On April 16, 2004 the parties filed a written Stipulation of
Agreement of Compromise and Settlement with the Barbour County,
Alabama Circuit Court seeking potential settlement of the
Roberts case.
A fairness hearing on the potential settlement was held by the
Barbour County Circuit Court on July 15, 2004. After receipt of
briefs on certain issues and submission of materials relating to
objections to the proposed settlement to the court-appointed
independent special master, the Court reconvened the previously
continued fairness hearing on Sept. 23, 2004.
After the Sept. 23, 2004 hearing, the court, after hearing from
the objectors to the potential settlement, ordered the
appointment of an independent actuary to report back to the
Court on certain issues. The report of the independent actuary
was subsequently furnished to the special master and the Court
on a timely basis.
On Nov. 22, 2004, the court entered an order and final judgment
in Roberts whereby the court consolidated Roberts with
"Robertson v. Liberty National Life Insurance Company, CV-92-
021," for purposes of the Roberts stipulation of settlement and
certified the Roberts class as a new subclass of the class
previously certified by that court in Robertson.
The court approved the stipulation and settlement and ordered
and enjoined Liberty to perform its obligations under the
stipulation.
Subject to the stipulation, Liberty and Torchmark were
permanently enjoined from:
-- instituting, engaging or participating in, maintaining,
authorizing or continuing premium rate increases
inconsistent with the Stipulation;
-- failing to implement temporary premium waivers in
accordance with the Stipulation;
-- failing to implement the new benefits procedure
described in the Stipulation; and
-- failing to implement the special schedules and special
provisions of the stipulation for subclass members who
have cancer and are receiving benefits and for subclass
members who have no other cancer or medical insurance
and/or are not covered by Medicare.
The court dismissed plaintiffs' claims, released the defendants,
enjoined Roberts subclass members from any further prosecution
of released claims and retained continuing jurisdiction of all
matters relating to the Roberts settlement.
In an order issued Feb. 1, 2005, the court denied the objectors'
motion to alter, amend or vacate its earlier final judgment on
class settlement and certification.
The companies proceeded to implement the settlement terms. On
March 10, 2005, the Roberts plaintiffs filed notice of appeal to
the Alabama Supreme Court.
In an opinion issued on September 29, 2006, the Alabama Supreme
Court voided the Barbour County Circuit Court's final judgment
and dismissed the Roberts appeal.
The Supreme Court held that the Barbour County Court lacked
subject-matter jurisdiction in Roberts to certify the Roberts
class as a subclass of the Robertson class and to enter a final
judgment approving the settlement since Roberts was filed as an
independent class action collaterally attacking Robertson rather
than being filed in Robertson under the Barbour County Court's
reserved continuing jurisdiction over that case.
On Oct. 23, 2006, Liberty filed a petition with the Barbour
County Circuit Court under its continuing jurisdiction in
Robertson for clarification, or in the alternative, to amend the
Robertson final judgment.
Liberty seeks an order from the Circuit Court declaring that
Liberty pay benefits to Robertson class members based upon the
amounts accepted by providers in full payment of charges.
Torchmark, Corp. in the Net: http://www.torchmarkcorp.com.
TORCHMARK CORP: Trial for Vesta Insurance Suit in Ala. Stayed
-------------------------------------------------------------
The Oct. 2, 2006 trial for the class action, "In re Vesta
Insurance Group, Inc. Securities Litigation, Master File No. 98-
AR-1407-S," which names Torchmark Corp., as one of the
defendants, was stayed pending in an interlocutory appeal to the
U.S. Circuit Court of Appeals for the Eleventh Circuit.
On March 15, 1999, the company was named as a defendant in
consolidated derivative securities class action litigation,
which was filed in the U.S. District Court for the Northern
District of Alabama.
The amended consolidated complaint in this litigation alleges
violations of Section 10(b) of the U.S. Securities Exchange Act
of 1934 by the defendants Vesta, certain present and former
Vesta officers and directors, KPMG, LLP (Vesta's former
independent public accountants) and Torchmark and of Section
20(a) of the Exchange Act by certain former Vesta officers and
directors and Torchmark acting as "controlling persons" of Vesta
in connection with certain accounting irregularities in Vesta's
reported financial results and filed financial statements.
Unspecified damages and equitable relief are sought on behalf of
a purported class of purchasers of Vesta equity securities
between June 2, 1995 and June 29, 1998.
A class was certified in this litigation on Oct. 25, 1999. In
September 2001, Torchmark filed a motion for summary judgment,
which was denied by the court on Jan. 10, 2002.
On April 9, 2003, the court issued an order denying the class
plaintiffs' motion to strike certain of Torchmark's affirmative
defenses, holding that Torchmark cannot be held jointly and
severally liable with Vesta under the securities law without an
affirmative jury determination that Torchmark knowingly
committed a violation of the securities laws.
Vesta, its officers and directors, its insurance carriers and
KPMG settled their portions of the litigation with class
plaintiffs in 2001; Torchmark did not. Subsequently, in May
2003, Torchmark instituted separate litigation against KPMG,
which was resolved in March 2006.
In April 2006, class plaintiffs in Vesta Insurance Group
Securities Litigation filed a motion in the U.S. District Court
for the Northern District of Alabama renewing their claims
against Torchmark based upon an allegation of control person
liability.
This matter was set for trial in the court on Oct. 2, 2006 and
has been stayed pending resolution of an interlocutory appeal to
the U.S. Circuit Court of Appeals for the Eleventh Circuit filed
by class plaintiffs.
The interlocutory appeal, which was filed Aug. 23, 2006, seeks a
ruling whether and to what extent proportionate liability
provisions may apply if the allegations of control person
liability against Torchmark are ultimately proven, according to
company's Nov. 8, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the period ended Sept. 30, 2006.
The suit is "In re Vesta Insurance Group, Inc. Securities
Litigation, Master File No. 98-AR-1407-S," filed in the U.S.
District Court for the Northern District of Alabama under Judge
Karon O. Bowdre.
Representing the plaintiffs is Arthur C. Leahy of Milberg Weiss
Bershad Hynes & Lerach, LLP, 401 B Street, Suite 1700, San
Diego, CA 92101, Phone: 1-619-231-1058, Fax: 1-619-231-7423.
Representing the defendants is Joseph D Jackson, Jr. of Baxley
Dillard Dauphin & Mcknight, 2008 Third Avenue, South,
Birmingham, AL 35205, Phone: 271-1100, E-mail:
jjackson@bddmc.com.
TRAVEL COS: Faces 14 Suits Related to Hotel Occupancy Taxes
-----------------------------------------------------------
A number of cities and counties have filed putative class
actions on behalf of themselves and other allegedly similarly
situated cities and counties within the same respective state
against Priceline.com Inc. and other defendants, including, but
not in all cases:
-- Hotels.com, L.P.;
-- Hotel.com GP, LLC;
-- Hotwire, Inc.;
-- Cheaptickets, Inc.;
-- Cendant Travel Distribution Services Group, Inc.;
-- Expedia, Inc.;
-- Internetwork Publishing Corp. (d/b/a Lodging.com);
-- Lowestfare.com, Inc.;
-- Maupintour Holding LLC;
-- Orbitz, Inc.;
-- Orbitz, LLC;
-- Site59.com, LLC;
-- Travelocity.com, Inc.;
-- Travelocity.com LP;
-- Travelweb, LLC; and
-- Travelnow.com, Inc.
Each complaint alleges, among other things, that the defendants
violated each jurisdiction's respective hotel occupancy tax
ordinance with respect to the charges and remittance of amounts
to cover taxes under each ordinance. Each complaint typically
seeks compensatory damages, disgorgement, penalties available by
law, attorneys' fees, and other relief. Such actions include:
(1) "City of Los Angeles v. Hotels.com, Inc., et al."
On Dec. 30, 2004, a putative class action complaint was filed in
the Superior Court for the County of Los Angeles by the City of
Los Angeles on behalf of itself and a putative class of
California cities, counties and other municipalities that have
enacted occupancy taxes.
In addition to the tax claims, the complaint also asserts unfair
competition claims under California Business and Professions
Code section 17200, et seq. On May 19, 2005, the court ordered
limited discovery. On Aug. 31, 2005, the City of Los Angeles
filed an amended complaint adding a claim for a declaratory
judgment.
On Sept. 26, 2005, the court sustained the defendants' demurrers
on the ground of improper joinder of defendants and claims, and
therefore, dismissed the amended complaint, with leave to file a
second amended complaint.
On Feb. 8, 2006, the City of Los Angeles filed a second amended
complaint that asserts the same claims but includes additional
allegations of fact.
On March 27, 2006, the defendants filed demurrers to the second
amended complaint. Those demurrers have been fully briefed and
are awaiting decision. On March 31, 2006, the defendants filed
a petition to coordinate of this matter with the City of San
Diego case.
On July 12, 2006, that petition was granted, and, as a result,
this case and the City of San Diego case will now proceed in the
Superior Court of Los Angeles.
(2) "City of Fairview Heights v. Orbitz, Inc., et al."
On Oct. 5, 2005, a putative class action complaint was filed in
the Circuit Court, Twentieth Judicial Circuit, St. Clair County,
Illinois by the City of Fairview Heights on behalf of itself and
a putative class of Illinois taxing authorities that are
allegedly authorized to impose a tax on the business of renting
hotel rooms.
In addition to the tax claims, the complaint also asserts claims
for violation of the Illinois Consumer Fraud and Deceptive
Practices Act, 815 ILCS 505/1, similar laws in other states,
conversion and unjust enrichment.
On Nov. 28, 2005, the company and certain other defendants
removed this action to the U.S, District Court for the Southern
District of Illinois.
On Jan. 17, 2006, the defendants moved to dismiss the complaint.
On Feb. 10, 2006, the City of Fairview Heights moved to remand
this action to state court.
On July 12, 2006, the court granted defendants' motion to
dismiss all claims other than the tax claim, denied defendants'
motion to dismiss the tax claim, and denied plaintiff's motion
to remand. The parties are currently conducting discovery.
(3) "City of Findlay v. Hotels.com, L.P., et al."
On Oct. 25, 2005, a putative class action complaint was filed in
the Common Pleas Court of Hancock County, Ohio by the City of
Findlay on behalf of itself and a putative class of Ohio cities,
counties and townships that have enacted occupancy or excise
taxes on lodging.
In addition to the tax claims, the complaint also asserts claims
for violation of the Ohio Consumer Sales Practices Act, Ohio
Revised Code Chapter 1345, et seq., conversion, a constructive
trust and a declaratory judgment.
On Nov. 22, 2005, the company and certain other defendants
removed this action to the U.S. District Court for the Northern
District of Ohio.
On Jan. 30, 2006, the defendants moved to dismiss the complaint.
On July 26, 2006, the court granted defendants' motion to
dismiss the Consumer Sales Practices Act claims and denied
defendants' motion to dismiss the remaining claims.
The parties are currently conducting discovery.
(4) "City of Rome, Georgia, et al., v. Hotels.com, L.P., et
al."
On Nov. 18, 2005, a putative class action complaint was filed in
the U.S. District Court for the Northern District of Georgia by
the City of Rome, Hart County and the City of Cartersville on
behalf of themselves and a putative class of Georgia cities,
counties and governments which have enacted transient occupancy
taxes and/or excise taxes on lodging.
In addition to the tax claims, the complaint also asserts claims
for violation of Georgia's Uniform Deceptive and Unfair Trade
Practices Act, conversion, unjust enrichment, a constructive
trust and a declaratory judgment.
On Feb. 6, 2006, the company and certain other defendants moved
to dismiss the complaint. On May 8, 2006, the court granted
defendants' motion to dismiss all claims relating to the Georgia
sales and use tax and denied defendants' motion to dismiss the
excise tax claims.
The plaintiffs filed an amended complaint on June 7, 2006 naming
additional plaintiffs. The parties are currently conducting
discovery.
(5) "Pitt County v. Hotels.com, L.P., et al."
On Dec. 1, 2005, a putative class action complaint was filed in
the North Carolina General Court of Justice, Superior Court
Division by Pitt County on behalf of itself and a putative class
of North Carolina political subdivisions that impose occupancy
taxes.
In addition to the tax claims, the complaint also asserts claims
for violation of North Carolina General Statute Section 75-1, et
seq., conversion, a constructive trust and a declaratory
judgment.
On Feb. 13, 2006, the defendants removed this action to the U.S.
District Court for the Eastern District of North Carolina. On
March 13, 2006, the defendants moved to dismiss the complaint
and that motion was heard on Oct. 17, 2006. The parties are
awaiting a decision on the motion to dismiss.
(6) "City of San Antonio, Texas v. Hotels.com, L.P., et
al."
On May 8, 2006, a putative class action complaint was filed in
the U.S. District Court for the Western District of Texas, San
Antonio Division, by the City of San Antonio on behalf of itself
and putative classes of Texas municipalities.
In addition to the tax claims, the complaint also asserts claim
for conversion and a declaratory judgment.
On June 30, 2006, the company and other defendants moved to
dismiss the complaint. On Aug. 28, 2006, the plaintiff moved
for class certification.
Following briefing of the motion to dismiss and motion for class
certification, on Oct. 30, 2006, the plaintiff filed a first
amended complaint that limited the putative classes of Texas
municipalities to 175 specifically enumerated municipalities
that plaintiff alleges to have hotel occupancy tax ordinances
similar to that of the plaintiff.
On Nov. 2, 2006, the court heard argument on the motion to
dismiss and the parties are awaiting a decision. The court
delayed consideration of the motion for class certification
pending briefing on class definition of the first amended
complaint.
(7) "City of Gallup, New Mexico v. Hotels.com, L.P., et
al."
On May 17, 2006, a putative class action was filed in the 11th
Judicial District Court, County of McKinley, New Mexico, by the
City of Gallup on behalf of itself and a putative class of New
Mexico municipalities, which have enacted lodgers' taxes.
In addition to the tax claims, the complaint also asserts claims
for conversion and a declaratory judgment. On June 23, 2006
defendants removed the action to the U.S. District Court for the
District of New Mexico.
On July 31, 2006, the company and other defendants moved to
dismiss the complaint. That motion is pending.
On Sept. 29, 2006, the company and other defendants moved to
stay discovery pending a decision on that motion, and on Nov. 2,
2006, the Court granted that motion in part and stayed all
discovery unrelated to class certification.
(8) "Lake County Convention and Visitors Bureau, Inc. and
Marshall County v. Hotels.com, L.P., et al."
On June 12, 2006, a putative class action was filed in the
United Stated District Court for the Northern District of
Indiana, Hammond Division, by the Lake County Convention and
Visitors Bureau and Marshall County on behalf of themselves and
a putative class of Indiana counties, convention and visitors
bureaus and any other local governments which have enacted or
benefit from taxes on innkeepers.
In addition to the tax claims, the complaint also asserts claims
for conversion, unjust enrichment, and breach of fiduciary
duties. On Nov. 3, 2006, the company and other defendants moved
to dismiss the complaint. That motion is being briefed.
(9) "City of Orange, Texas v. Hotels.com, L.P., et al."
On July 18, 2006, a putative class action was filed in the U.S.
District Court for the Eastern District of Texas, Beaumont
Division, by the City of Orange on behalf of itself and a
putative class of Texas municipalities containing hotels in
which rooms were marketed, distributed, sold or resold by
defendants.
In addition to the tax claims, the complaint also asserts claims
for conversion, civil conspiracy, and a declaratory judgment.
On Sept. 12, 2006, the company and other defendants moved to
dismiss the complaint. The motion is being briefed.
(10) "Leon County and Doris Maloy, Leon County Tax
Collector v. Hotels.com, L.P., et al."
On July 27, 2006, a putative class action was filed in the U.S.
District Court for the Southern District of Florida, by Leon
County and its tax collector on behalf of themselves and a
putative class of Florida counties that collect tourist
development taxes.
On Sept. 25, 2006, the company and other defendants moved to
dismiss the complaint. That motion is being briefed.
(11) "City of Jacksonville v. Hotels.com, L.P., et al."
In July 2006, a putative class action was filed in the Circuit
Court, Fourth Judicial Circuit, in and for Duval County, Florida
by the City of Jacksonville on behalf of itself and a putative
class of Florida counties that collect tourist development taxes
and/or convention development taxes and that have elected self-
administration of such taxes.
In addition to the tax claims, the complaint also asserts claims
for conversion, unjust enrichment, a constructive trust, and a
declaratory judgment.
On Sept. 22, 2006, the company and other defendants moved to
stay this action in favor of the Leon County case (discussed
above), and that motion is pending.
(12) "City of Columbus, et al. v. Hotels.com, L.P., et al."
On Aug. 8, 2006, a putative class action complaint was filed in
the U.S. District Court for the Southern District of Ohio by the
Cities of Columbus and Dayton on behalf of themselves and a
putative class of Ohio cities, counties and townships that have
enacted occupancy or excise taxes on lodging.
In addition to the tax claims, the complaint also asserts claims
for unjust enrichment, money had and received, conversion, a
constructive trust, and a declaratory judgment.
On Sept. 25, 2006, the company and other defendants moved to
dismiss the complaint. On Sept. 27, 2006, the company and other
defendants moved to transfer the case to the U.S. District Court
for the Northern District of Ohio, where the City of Findlay
case is pending. Those motions are pending.
(13) "Louisville/Jefferson County Metro Government v.
Hotels.com, L.P., et al."
On Sept. 21, 2006, a putative class action was filed in the U.S.
District Court for the Western District of Kentucky by the
Louisville/Jefferson County Metro Government on behalf of itself
and a putative class of Kentucky cities, counties and townships
that have enacted transient room taxes.
In addition to the tax claims, the complaint also asserts claims
for conversion, money had and received, unjust enrichment, a
constructive trust, and a declaratory judgment. The company and
its subsidiaries have agreed to accept service of the complaint.
(14) "County of Nassau, New York v. Hotels.com, LP, et al."
On Oct. 24, 2006, a putative class action was filed in the U.S.
District Court for the Eastern District of New York by Nassau
County on behalf of itself and a putative class of New York
cities, counties and other local governmental entities that have
imposed hotel taxes since March 1, 1995.
In addition to the tax claims, the complaint also asserts claims
for conversion, unjust enrichment and a constructive trust. The
company and its subsidiaries have not been served with the
complaint.
UNITEDHEALTH GROUP: Court Freezes Retirement Pay of Outgoing CEO
----------------------------------------------------------------
The U.S. District Court for the District of Minnesota ruled in
favor of the California Public Employees' Retirement System
(CalPERS) in a purported class action against UnitedHealth
Group, Inc. by granting an injunction freezing the retirement
payments due to the outgoing chief executive of the company,
Jennifer McCandless of The Financial News Online reports.
CalPERS, the largest U.S. pension fund, is pursuing the case
against the health insurance company, over a stock options
scandal and sought the injunction against William M. McGuire,
who officially retired as chairman of the company on Dec. 1,
2006.
A court clerk, who confirmed the ruling, explained that the
injunction will be in effect for 30 days, during which time a
special committee appointed by the board of directors will
investigate the merits of shareholder lawsuits.
In addition, the court clerk pointed out that the order also
prevents the healthcare company and Mr. McGuire from continuing
to discuss departure terms.
Mr. McGuire is also prohibited from accessing a pension and
other benefits he received in a 1999 employment agreement that
would allow him a pension of $5.1 million annually with a lump
sum of $6.4 million.
Case background
In July 2006, CalPERS initiated the class action in the U.S.
District Court for the District of Minnesota against
UnitedHealth Group, Inc., in relation to its stock option
practices (Class Action Reporter, July 14, 2006).
Named as defendants in the suit are:
-- UnitedHealth Group, Inc.;
-- William W. McGuire, chairman and chief executive;
-- Stephen J. Hemsley, president and chief operating
officer;
-- Lois Quam - division chief executive officer;
-- the company's chief financial officer, general counsel,
its directors and the three other division CEOs.
The complaint alleges:
-- that the company and the officers and directors named as
defendants illegally misled investors about
UnitedHealth's financial prospects;
-- that the company "spring-loaded" options -- granting
stock options just ahead of positive news, helping lock
in a profit for the recipient of the options;
-- that many of the officers and directors - including Ms.
Quam, CEO William McGuire and Stephen Hemsley, the
company's chief operating officer - benefited by
receiving improper back-dated stock options or options
awarded just prior to news that drove up share prices;
and
-- that discrepancies between UnitedHealth's public
statements about its profits and the troubles with its
stock options that surfaced.
In May, UnitedHealth acknowledged a "significant deficiency" in
its stock option grants and has said it may have to restate up
to $286 million in earnings for 2003, 2004, and 2005.
The complaint also asserts that Ms. Quam -- CEO of
UnitedHealth's Ovations unit that handles insurance for retirees
-- "reaped illegal insider trading proceeds of $8.86 million by
selling 173,200 shares of her UnitedHealth stock."
But the suit does not specifically accuse Ms. Quam of making
misleading statements or allege she had any role in awarding
stock options.
UnitedHealth spokesman Mark Lindsay said some executives,
including Ms. Quam, has been arbitrarily included, and there is
no particular allegation against them in the complaint.
CalPERS spokesman Brad Pacheco declined to address specifics of
the lawsuit because the pension fund is seeking status as lead
plaintiff.
The suit is "California Public Employees Retirement System v.
UnitedHealth Group, Inc. et al., Case No. 0:06-cv-02939-RHK-
JSM," filed in the U.S. District Court for the District of
Minnesota under Judge Richard H. Kyle, with referral to Judge
Janie S. Mayeron.
Representing the plaintiffs is Garrett D. Blanchfield, Jr. of
Reinhardt Wendorf & Blanchfield, 332 Minnesota St Ste E-1250, St
Paul, MN 55101, Phone: 651-287-2100, E-mail:
g.blanchfield@rwblawfirm.com.
UNITED AMERICAN: Plaintiffs Initiate Amended Fraud Lawsuit in TX
----------------------------------------------------------------
A settlement was reached in a class action, "Rodriguez v.
Burdine, et al., DC-05-8," which was filed against United
American Insurance Co. in the District Court of Starr County,
Texas, according to Torchmark Corp.'s Nov. 8, 2006 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
period ended Sept. 30, 2006.
The suit was initially filed on Jan. 7, 2005, behalf of the
Texas purchasers of association group health insurance policies
or certificates issued by the company through Heartland Alliance
of America and Farm & Ranch Healthcare, Inc.
Plaintiffs assert claims of civil conspiracy, conversion and
theft, violations of the Texas Insurance and Administrative
Codes, breach of fiduciary duties, fraud and gross negligence
and breach of contract as well as filing a members
representative action on behalf of all the members of the
Heartland Association. They allege that the defendants have
collected excessive and unauthorized association dues payments
from policyholders.
A class certification hearing was held on Aug. 31, 2006, at
which time the court considered and approved a proposed
settlement agreement between the parties.
A fairness hearing was conducted on Oct. 5, 2006 and the
judgment and related orders were entered without issues. The
final settlement will be concluded on Nov. 9, 2006.
VALICERT INC: N.Y. Court Mulls Final Approval of IPO Suit Deal
--------------------------------------------------------------
The U.S. District Court for the Southern District of New York
has yet to issue an order with respect to the final approval of
the settlement of the consolidated securities class action
against Valicert, Inc., according to Tumbleweed Communications
Corp.'s Nov. 9, 2006 Form 10-Q filing with the U.S. Securities
and Exchange Commission for the period ended Sept. 30, 2006.
In December 2001, certain plaintiffs filed a class action on
behalf of purchasers of the common stock of the company,
alleging violations of federal securities laws. The suit is "In
re Valicert, Inc. Initial Public Offering Securities Litigation,
No. 01-CV-10889 (SAS)," related to "In re Initial Public
Offering Securities Litigation, No. 21 MC 92 (SAS)."
The operative amended complaint was brought on purported behalf
of all persons who purchased the company's common stock from the
date of its July 27, 2000 initial public offering (IPO) through
Dec. 6, 2000. It named as defendants the company, its former
chief executive officer, its chief financial officer, as well as
an investment banking firm that served as an underwriter for the
IPO.
The complaint alleges liability under Sections 11 and 15 of the
Securities Act of 1933 and Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, on the grounds that the
registration statement for the IPO did not disclose that:
-- the underwriter agreed to allow certain customers to
purchase shares in the IPO in exchange for excess
commissions to be paid to the underwriter; and
-- the underwriter arranged for certain customers to
purchase additional shares in the aftermarket at
predetermined prices.
The complaint also appears to allege that false or misleading
analyst reports were issued. The complaint does not claim any
specific amount of damages.
Similar allegations have been made in lawsuits relating to more
than 300 other initial public offerings conducted in 1999 and
2000, all of which have been consolidated for pretrial purposes.
In February 2003, the court issued a ruling on all defendants'
motions to dismiss, denying the company's motion to dismiss the
claims under the Securities Act of 1933, but granting the
company's motion to dismiss the claims under the Securities
Exchange Act of 1934.
In June 2003, company accepted a settlement proposal presented
to all issuer defendants in this case. Under the proposed
settlement, the plaintiffs will dismiss and release all claims
against the Valicert Defendants in exchange for a contingent
payment guaranty by the insurance companies collectively
responsible for insuring the issuers in all the consolidated
cases, and the assignment or surrender of control to the
plaintiffs of certain claims the issuer defendants may have
against the underwriters.
Under the guaranty, the insurers will be required to pay the
amount, if any, by which $1 billion exceeds the aggregate amount
ultimately collected by the plaintiffs from the underwriter
defendants in all of the cases.
If the plaintiffs fail to recover $1 billion and payment is
required under the guaranty, the company would be responsible to
pay its pro rata portion of the shortfall, up to the amount of
the deductible retention under its insurance policy, which is
$500,000.
The timing and amount of payments that the company could be
required to make under the proposed settlement will depend on
several factors, principally the timing and amount of any
payment required by the insurers pursuant to the $1 billion
guaranty.
The proposed settlement is subject to approval of the Court,
which cannot be assured. In April 2006 the court held a hearing
on the proposed settlement but has not yet issued a ruling on
the issue.
For more details, visit http://www.iposecuritieslitigation.com/.
New Securities Fraud Cases
BRANTLEY CAPITAL: Brower Piven Announces N.Y. Stock Suit Filing
---------------------------------------------------------------
The law firm of Brower Piven announced that a securities class
action was commenced on behalf of shareholders who purchased or
otherwise acquired the common stock of Brantley Capital Corp.
between Aug. 14, 2003 and Oct. 24, 2005.
The case is pending in the U.S. District Court for the Southern
District of New York against defendant Brantley and one or more
of its officers and/or directors.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the class period, which
statements had the effect of artificially inflating the market
price of the company's securities. No class has yet been
certified in the above action.
Any request for appointment as lead plaintiff must be made with
the court appoint by Jan. 16, 2007.
For more details, contact Brower Piven at The World Trade
Center-Baltimore, 401 East Pratt Street, Suite 2525, Baltimore,
Maryland 21202, Phone: 410/986-0036, E-mail:
hoffman@browerpiven.com.
HANSEN NATURAL: Wolf Haldenstein Files Securities Suit in Calif.
----------------------------------------------------------------
Wolf Haldenstein Adler Freeman & Herz, LLP, filed a class action
lawsuit in the U.S. District Court for the Central District of
California, on behalf of all persons who purchased the common
stock of Hansen Natural Corp. between Nov. 12, 2001 and Nov. 9,
2006, against defendants Hansen, and certain of its officers and
directors, including Rodney C. Sacks, Hilton H. Schlosberg,
Norman C. Epstein, Harold C. Taber, Jr., Mark S. Vidergauz, Mark
J. Hall, Michael B. Schott, and Thomas J. Kelly, alleging
violations under the Securities Exchange Act of 1934, 15 U.S.C.
Section 78j(b), 78(t) and 78t(a) and Rule 10b-5, promulgated
thereunder, 17 C.F.R. Section 240.10b-5.
The complaint alleges that throughout the class period,
defendants issued numerous, positive press releases, statements
and quarterly financial reports filed with the SEC that
described the company's financial performance.
These statements were materially false and misleading because
they failed to disclose and misrepresented the following adverse
facts, among others:
-- that defendants engaged in the backdating of stock
option grants for certain key executives of the
company;
-- that the company lacked adequate internal controls and
was therefore unable to ascertain its true financial
condition; and
-- that as a result of the foregoing, defendants engaged
in improper accounting practices.
On Oct. 31, 2006, the company filed a Form 8-K with the SEC
indicating that it received a letter from the Staff of the
Pacific Regional Office of the SEC requesting that the company
voluntarily produce certain documents and information relating
to the its filing of SEC Forms 4 and the company's stock option
grant practices from Jan. 1, 1996 to the present.
On Nov. 9, 2006, the company issued a press release announcing a
delay in the filing of its quarterly report. The company
reported that "in light of the investigation discussed above,
the company is not in a position to complete the preparation of
the financial statements and certain related information
required to be included in Form 10-Q for the quarter ended Sept.
30, 2006. The company intends to file Form 10-Q as soon as
practicable after the completion of the investigation by the
Special Committee."
Following this news, shares of the company's common stock fell
substantially on unusually heavy trading volume.
As a result of the dissemination of the false and misleading
statements set forth above, the market price of Hansen common
stock was artificially inflated during the class period.
In ignorance of the false and misleading nature of the
statements described above, and the deceptive and manipulative
devices and contrivances employed by said defendants, plaintiffs
and the other members of the class relied, to their detriment,
on the integrity of the market price of Hansen common stock.
Had plaintiffs and the other members of the class known the
truth, they would not have purchased said common stock, or would
not have purchased them at the inflated prices that were paid.
The case name is "Hutton v. Hansen Natural Corporation, et al."
Any request for appointment as lead plaintiff must be made with
the court appoint by Jan. 29, 2007.
For more details, contact Lawrence P. Kolker, Esq., Martin E.
Restituyo, Esq., or Derek Behnke of Wolf Haldenstein Adler
Freeman & Herz LLP at 270 Madison Avenue, New York, New York
10016, Phone: (800) 575-0735, E-mail: classmember@whafh.com, Web
site: http://www.whafh.com.
WARNER CHILCOTT: Yourman Alexander Announces Stock Suit Filing
--------------------------------------------------------------
Yourman Alexander & Parekh, LLP, announces that lawsuits seeking
class action status have been filed on behalf of shareholders
who purchased or otherwise acquired the securities of Warner
Chilcott Ltd. during the period Sept. 20, 2006 through Sept. 26,
2006. The suits is pending in the United States District Court
for the Southern District of New York.
The lawsuits allege, in part, that the company and certain of
its officers and directors violated federal securities laws by
failing to disclose in the prospectus and registration statement
effective on Sept. 20, 2006, that the company had discontinued
shipment of one of its key products, Ovcon 35, while
simultaneously selling over 70 million of its shares for over $1
billion.
Six days later, when Warner finally disclosed this fact, and
after it had already conducted its offering, Warner shares
plummeted from approximately $15.00 per share to $12.60 per
share.
Any request for appointment as lead plaintiff must be made with
the court appoint by Jan. 2, 2007.
For more details, contact Vahn Alexander or Behram Parekh of
Yourman Alexander & Parekh LLP, 3601 Aviation Blvd., Suite 3000,
Manhattan Beach, California 90266, Phone: (800) 725-6020, E-
mail: parekhb@yaplaw.com, Web site: http://www.yaplaw.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
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Information contained herein is obtained from sources believed
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