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C L A S S A C T I O N R E P O R T E R
Friday, March 9, 2007, Vol. 9, No. 49
Headlines
AGILE SOFTWARE: N.Y. Court Defers Ruling on IPO Suit Settlement
ALLIANCEBERNSTEIN HOLDING: Claims Processing Error Costs $56M
BEMIS CO: Still Faces Labelstock Suits in State, Federal Courts
BJC HEALTHCARE: Circuit Court Certifies Price Gouging Lawsuit
BLOCKBUSTER INC: Suit Over "End of Late Fees" Program Withdrawn
CEPHALON INC: Still Faces Suit Over Patent Case Settlement
CERIDIAN CORP: Seeks Dismissal of Consolidated Securities Suit
CHOICEPOINT INC: Parties Reach Settlement in Fla. DPPA Lawsuit
CHOICEPOINT INC: Seeks 11th Circuit Review of Securities Suit
CONAGRA FOODS: Faces Fla. Suit Over Contaminated Peanut Butter
CONAGRA FOODS: Faces Ky. Lawsuit Over Contaminated Peanut Butter
CONAGRA FOODS: Faces Miss. Suit Over Contaminated Peanut Butter
DEFIBTECH LLC: Recalls Faulty Automatic External Defibrillators
DISCOUNT SCHOOL: Recalls 2-Sided Easels for Lead Poisoning Risks
FREEPORT-MCMORAN: Faces Suit in Ariz. Over Phelps Dodge Deal
GENERAL REINSURANCE: Seeks Dismissal of Insurance Brokerage Suit
GENERAL REINSURANCE: Still Faces AIG Securities Suit in N.Y.
GOLD BANC: Settles Farmers Lawsuit Over Loan Fees, Interest
HALLIBURTON CO: Continues to Face Lawsuit by LogCAP Workers
HSBC FINANCE: Discovery Begins in Interchange Fee Litigation
HSBC FINANCE: Expert Discovery in Ill. Securities Suit Ongoing
MAMMA.COM INC: N.Y. Court Approves $3.15M Securities Suit Deal
PEMSTAR INC: Discovery Proceeds in Minn. Securities Fraud Suit
QUOVADX INC: Col. Court Approves $9M Securities Suit Settlement
RJR TOBACCO: Opposes Amendment in N.C. ERISA Violations Suit
SENDTEC INC: Fla. Judge Dismisses Securities Fraud Lawsuit
TOBACCO LITIGATION: Two Antitrust Cases Remain in State Courts
TOBACCO LITIGATION: "Cleary" Plaintiffs Request Class Status
TOBACCO LITIGATION: Ill. Suit Claims Nicotine Content Increase
TOBACCO LITIGATION: Minn. "Health Impact Fee" Suit Dismissed
TOBACCO LITIGATION: "Parsons v. AC&S" Remains Stayed in W.Va.
VIACOM INC: Amended Claims Filed in Suit Over Blockbuster Deal
* Large U.S. Settlements Could Encourage Similar Suits in Korea
Asbestos Alert
ASBESTOS LITIGATION: Illinois Tool Works Still Has Injury Suits
ASBESTOS LITIGATION: Travelers Property Still Faces ACandS Suits
ASBESTOS LITIGATION: St. Paul Travelers Incurs $155M Loss in 4Q
ASBESTOS LITIGATION: St. Paul Reserves $4.051B for Claims in 4Q
ASBESTOS LITIGATION: Union Pacific Has 2,277 Open Claims in 4Q06
ASBESTOS LITIGATION: NewMarket Reserves $10.23M in 4Q for Claims
ASBESTOS LITIGATION: Claims v. American Standard Rise to 112,668
ASBESTOS LITIGATION: American Standard Liability Totals $665.8M
ASBESTOS LITIGATION: ASD Suit Discovery Still Extended to Sept.
ASBESTOS LITIGATION: American Standard Cites $385.8M Receivable
ASBESTOS LITIGATION: Safeco Reserves $206.3M in 4Q06 for Claims
ASBESTOS LITIGATION: Claims v. Baltimore Gas Remain at 522 in 4Q
ASBESTOS LITIGATION: Cleco Still Faces La. Site Exposure Claims
ASBESTOS LITIGATION: Cases v. Corning Inc. Remain at 10.9T at 4Q
ASBESTOS LITIGATION: Corning Records $656M Settlement Liability
ASBESTOS LITIGATION: Curtiss-Wright Faces 120 Injury Suits in 4Q
ASBESTOS LITIGATION: Foster Wheeler Has $424.6M Liability in 4Q
ASBESTOS LITIGATION: Foster Wheeler Has 330 U.K. Claims at 4Q06
ASBESTOS LITIGATION: Foster Wheeler Ltd. Has 135T Claims at 4Q
ASBESTOS LITIGATION: Pending Suits v. AK Steel Rise to 421 in 4Q
ASBESTOS LITIGATION: Exposure Claims v. Grainger Rise to 3,100
ASBESTOS LITIGATION: Harsco Records 26,440 Pending Claims in 4Q
ASBESTOS LITIGATION: Longview Fibre Continues to Face Mo. Action
ASBESTOS LITIGATION: Longview Fibre Counters Travelers' Actions
ASBESTOS LITIGATION: Longview Fiber Faces Stalik Action in Tex.
ASBESTOS LITIGATION: Macerich Incurs $500T for Remediation in 4Q
ASBESTOS LITIGATION: Ohio Casualty Reserves $94.4M for A&E in 4Q
ASBESTOS LITIGATION: Phelps Dodge Still Faces Liability Lawsuits
ASBESTOS LITIGATION: Suit v. RJR Tobacco Ongoing in Calif. Court
ASBESTOS LITIGATION: RJR Tobacco, B&W Still Face Parsons Action
ASBESTOS LITIGATION: Law Firm Announces $2M Verdict v. GM, Ford
ASBESTOS LITIGATION: Kans. Worker's Estate Sues 94 Firms in Ill.
ASBESTOS LITIGATION: Philips Sued in Dutch Court on U.S. Claims
ASBESTOS LITIGATION: James Hardie Links 3Q07 Losses to Asbestos
ASBESTOS LITIGATION: Rogers Corp. Faces 148 Pending Claims in 4Q
ASBESTOS LITIGATION: Cases v. U.S. Steel Increase to 300 in 4Q06
ASBESTOS LITIGATION: Advance Auto Parts Still Faces Injury Suits
ASBESTOS LITIGATION: Allegheny Energy's W.Va. Suits Rise to 828
ASBESTOS LITIGATION: No Judgments Rendered in Actions v. AMETEK
ASBESTOS LITIGATION: Badger Meter Still Faces Multi-Party Suits
New Securities Fraud Cases
NEW CENTURY: Mager & Goldstein Files Securities Fraud Suit in CA
NOVASTAR FINANCIAL: Glancy Binkow Files Securities Fraud Suit
*********
AGILE SOFTWARE: N.Y. Court Defers Ruling on IPO Suit Settlement
---------------------------------------------------------------
The U.S. District Court for the District of New York indicated
that it would defer consideration of final approval of a
settlement in a consolidated securities fraud class action
against Agile Software Corp., according to the company's March 5
Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended April 30, 2006.
On or around Oct. 25, 2001, a class action was filed on behalf
of holders of Agile securities in the U.S. Southern District of
New York against Agile Software Corp., Bryan D. Stolle and
Thomas P. Shanahan, and others, including underwriters Morgan
Stanley and Deutsche Bank Securities.
The case is now captioned "In re Agile Software, Inc. Initial
Public Offering Securities Litigation, 01 CIV 9413 (SAS),"
related to "In re Initial Public Offering Securities Litigation,
21 MC 92 (SAS)."
On or about April 19, 2002, plaintiffs electronically served an
amended complaint. The amended complaint is brought purportedly
on behalf of all persons who purchased the company's common
stock from Aug. 19, 1999 through Dec. 6, 2000.
It names as defendants the Agile Defendants and several
investment banking firms that served as underwriters of the
company's initial public offering and secondary offering.
The complaint alleges liability under Sections 11 and 15 of the
Securities Act of 1933 and Sections 10(b) and 20(a) of the U.S.
Securities Exchange Act of 1934, on the grounds that the
registration statement for the offerings did not disclose that:
-- the underwriters had agreed to allow certain customers
to purchase shares in the offerings in exchange for
excess commissions paid to the underwriters; and
-- the underwriters had arranged for certain customers to
purchase additional shares in the aftermarket at
predetermined prices.
The amended complaint also alleges that false analyst reports
were issued. No specific damages are claimed.
The company is aware that similar allegations have been made in
other lawsuits filed in the U.S. District Court for the Southern
District of New York challenging over 300 other initial public
offerings and secondary offerings conducted in 1999 and 2000.
Those cases have been consolidated for pretrial purposes before
Judge Shira A. Scheindlin. On July 15, 2002, the Agile
Defendants as well as all other issuer defendants filed a motion
to dismiss the complaint.
On Feb. 19, 2003, the court ruled on the motions to dismiss.
The court denied the motions to dismiss claims under the
Securities Act of 1933 in all but 10 of the cases.
In the case involving the company, these claims were dismissed
as to the initial public offering, but not the secondary
offering.
The court denied the motion to dismiss the claim under Section
10(a) of the U.S. Securities Exchange Act of 1934 against the
company and 184 other issuer defendants, on the basis that the
amended complaints in these cases alleged that the respective
issuers had acquired companies or conducted follow-on offerings
after the initial public offerings.
As a consequence, the court denied the motion to dismiss the
Section 20(a) claims against the individual defendants. The
motion to dismiss the Section 10(a) claims was granted with
prejudice as to the individual defendants.
The company has decided to accept a settlement proposal
presented to all issuer defendants. In this settlement,
plaintiffs will dismiss and release all claims against the Agile
Defendants, in exchange for a contingent payment by the
insurance companies collectively responsible for insuring the
issuers in all of the IPO cases, and for the assignment or
surrender of control of certain claims the company may have
against the underwriters.
The Agile Defendants will not be required to make any cash
payments in the settlement, unless the pro rata amount paid by
the insurers in the settlement exceeds the limits of the
insurance coverage, a circumstance which the company does not
believe will occur.
The court granted preliminary approval to the settlement. It
held a hearing on April 24, 2006 to consider final approval of
the settlement, and will issue a ruling at some time in the
future.
On Dec. 5, 2006, the U.S. Court of Appeals for the 2nd Circuit
issued a decision in, "In re Initial Public Offering Securities
Litigation, WL 3499937 (2d Cir. Dec. 5, 2006)," reversing the
court's ruling certifying six of the cases in the consolidated
proceedings as class actions.
On Dec. 14, 2006, the court agreed to stay all proceedings,
including consideration of the settlement, pending a decision
from the 2nd Circuit on whether it will hear further argument on
the class certification issue.
For more details, visit http://www.iposecuritieslitigation.com/.
ALLIANCEBERNSTEIN HOLDING: Claims Processing Error Costs $56M
-------------------------------------------------------------
AllianceBernstein Holding L.P. and AllianceBernstein L.P.
recorded a $56.0 million charge for the estimated cost of
reimbursing certain clients for the error the company made in
processing claims for class action settlement proceeds.
As contemplated in their Jan. 24, 2007 earnings announcement,
both companies' results have been adjusted for a fourth quarter
2006 charge recorded by AllianceBernstein.
The $56.0 million charge ($54.5 million, net of the related
income tax benefit) reflects the estimated cost of reimbursing
certain clients for the error the company made in processing
claims for class action settlement proceeds on behalf of these
clients, which include some AllianceBernstein-sponsored mutual
funds.
The charge, which is included in general and administrative
expense, is somewhat larger than the amount contemplated in
their Jan. 24, 2007 earnings announcement, and reflects their
identification of additional class actions and client accounts
subject to the claim processing error during an extensive review
of the company's procedures.
The company continues to believe that most of these costs will
ultimately be recovered from residual settlement proceeds and
insurance.
Shareholders Suits Against AllianceBernstein
On Oct. 2, 2003, a purported class action complaint, "Hindo, et
al. v. AllianceBernstein Growth & Income Fund, et al.," was
filed against:
-- AllianceBernstein, L.P., formerly Alliance Capital
Management L.P.;
-- Alliance Capital Management Holding, L.P.;
-- Alliance Capital Management Corp.;
-- AXA Financial Corp.;
-- the AllianceBernstein Funds;
-- the registrants and issuers of those funds;
-- certain officers of the company and certain other
defendants not affiliated with the company; and
-- unnamed Doe defendants.
The Hindo Complaint was filed in the U.S. District Court for the
Southern District of New York by alleged shareholders of two
U.S. Funds. It alleges that certain of the AllianceBernstein,
L.P. defendants failed to disclose that they improperly allowed
certain hedge funds and other unidentified parties to engage in
"late trading" and "market timing" of U.S. Fund securities,
violating Sections 11 and 15 of the U.S. Securities Act,
Sections 10(b) and 20(a) of the Exchange Act, and Sections 206
and 215 of the Investment Advisers Act of 1940, as amended.
Plaintiffs sought unspecified amount of compensatory damages and
rescission of their contracts with AllianceBernstein, including
recovery of all fees paid to AllianceBernstein pursuant to such
contracts.
Since Oct. 2, 2003, 43 additional lawsuits making factual
allegations generally similar to those in the Hindo Complaint
were filed in various federal and state courts against
AllianceBernstein and certain other defendants.
The plaintiffs in such lawsuits have asserted a variety of
theories for recovery including, but not limited to, violations
of the Securities Act, the Exchange Act, the Advisers Act, the
Investment Company Act, the Employee Retirement Income Security
Act of 1974, certain state securities laws, and common law. All
state court actions against AllianceBernstein either were
voluntarily dismissed or removed to federal court. On Feb. 20,
2004, the Judicial Panel on Multidistrict Litigation transferred
all actions to the U.S. District Court for the District of
Maryland.
On Sept. 29, 2004, plaintiffs filed consolidated amended
complaints with respect to four claim types:
-- mutual fund shareholder claims,
-- mutual fund derivative claims,
-- derivative claims brought on behalf of Holding, and
-- claims brought under ERISA by participants in the Profit
Sharing Plan for Employees of AllianceBernstein.
All four complaints include substantially identical factual
allegations, which appear to be based in large part on the
company's agreement with the U.S. Securities and Exchange
Commission Order dated Dec. 18, 2003 (amended and restated Jan.
15, 2004), and the company's final agreement with the New York
State Attorney General on Sept. 1, 2004.
The claims in the mutual fund derivative consolidated amended
complaint are generally based on the theory that all fund
advisory agreements, distribution agreements and 12b-1 plans
between AllianceBernstein and the U.S. Funds should be
invalidated, regardless of whether market timing occurred in
each individual fund, because each was approved by fund trustees
on the basis of materially misleading information with respect
to the level of market timing permitted in funds managed by
AllianceBernstein.
The claims asserted in the other three consolidated amended
complaints are similar to those that the respective plaintiffs
asserted in their previous federal lawsuits. All of these
lawsuits seek an unspecified amount of damages.
On April 21, 2006, AllianceBernstein and attorneys for the
plaintiffs in the mutual fund shareholder claims, mutual fund
derivative claims, and ERISA claims entered into a confidential
memorandum of understanding containing their agreement to settle
these claims.
The company entered into a confidential memorandum of
understanding to settle:
-- mutual fund shareholder claims,
-- mutual fund derivative claims, and
-- ERISA claims.
The company said at its form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended Sept.
30, 2006 that the agreement will be documented by a stipulation
of settlement and will be submitted for court approval at a
later date.
Later, AllianceBernstein, L.P. said it has disbursed the
settlement money in the market timing-related litigation pending
against it in the U.S. District Court for the District of
Maryland (Class Action Reporter, Feb. 5, 2007).
BEMIS CO: Still Faces Labelstock Suits in State, Federal Courts
---------------------------------------------------------------
Bemis Co., Inc. and its wholly owned subsidiary, Morgan
Adhesives Co., remain as defendants in several purported class
actions in both state and federal courts that are alleging a
conspiracy to fix prices within the self-adhesive labelstock
industry.
Six lawsuits purporting to represent a nationwide class of
labelstock purchasers were initially filed against the company.
On Nov. 5, 2003, the Judicial Panel on MultiDistrict Litigation
issued a decision consolidating all of the federal class actions
for pretrial purposes in the U.S. District Court for the Middle
District of Pennsylvania, before the Honorable Chief Judge
Thomas I. Vanaskie.
Judge Vanaskie entered an order, which called for discovery to
be taken on the issues relating to class certification and
briefing on plaintiffs' motion for class certification to be
completed by March 1. A discovery cut-off and a trial date have
not been set, according to the company's Form 10-K filing with
the U.S. Securities and Exchange Commission for the fiscal year
ended Dec. 31, 2006
The company was also named in three lawsuits filed in California
Superior Court in San Francisco. These three lawsuits, which
were consolidated, seek to represent a class of all California
indirect purchasers of labelstock and each alleged a conspiracy
to fix prices within the self-adhesive labelstock industry.
A fourth lawsuit was also filed in the same state, which seeks
to represent a class of California direct purchasers of
labelstock and alleges a conspiracy to fix prices within the
self-adhesive labelstock industry.
Finally, the company was also named in:
-- one lawsuit in Vermont seeking to represent a class of
all Vermont indirect purchasers of labelstock;
-- one lawsuit in Nebraska seeking to represent a class of
all Nebraska indirect purchasers of labelstock;
-- one lawsuit in Kansas seeking to represent a class of
all Kansas indirect purchasers of labelstock;
-- one lawsuit in Tennessee seeking to represent a class of
purchasers of labelstock in various jurisdictions, and
-- one lawsuit in Arizona seeking to represent a class of
Arizona indirect purchasers of labelstock, all alleging
a conspiracy to fix prices within the self-adhesive
labelstock industry.
Bemis Co., Inc., on the Net: http://www.bemis.com/.
BJC HEALTHCARE: Circuit Court Certifies Price Gouging Lawsuit
-------------------------------------------------------------
Judge David Mason of the St. Louis (Missouri) Circuit Court
granted class-action status to a lawsuit, filed in 2004,
alleging BJC HealthCare overcharged thousands of uninsured
patients going back to 1999, the St. Louis Post-Dispatch
reports.
"The class certified by the court consists principally of
persons who received medical services and made no payments,
payment arrangements or requests for forgiveness on bills that
were sent to them," June McAllister Fowler, a spokeswoman for
BJC, said in a statement.
The class includes patients from 1999 to the present who lacked
insurance and paid the "charges" figure for their care. It's
not clear exactly how many patients are involved, the amount
each might be owed or the plaintiffs' total claims against BJC,
according to the report.
The complaints allege that many hospitals nationwide lacked
sufficient charity care programs and that those hospitals with
adequate programs often were lax in telling patients about them.
The Clayton firm of Riezman, Berger and Blitz charged that BJC
and its subsidiary, Missouri Baptist Medical Center and Sisters
of Mercy Health System and its subsidiary, St. John's Mercy
Medical Center, allowed a doctor to charge for work that was not
done (Class Action Reporter, March 9, 2005). It also charged
that the doctor "upcoded" other procedures to increase charges.
Also, the suit charges that the hospitals accepted a physician's
faulty descriptions of work done and, as a result, also
overcharged patients.
BJC operates 13 hospitals, with seven in the St. Louis
metropolitan area. Its annual revenues are about $2.8 billion
and it cares for about 30 percent of the hospital patients in
the metro area. BJC provides about $18 million a year in
charity care to area patients, but puts its benefit to the
region at more than $1.8 billion a year.
BLOCKBUSTER INC: Suit Over "End of Late Fees" Program Withdrawn
---------------------------------------------------------------
The plaintiff in the class action, "Edwards v. Blockbuster
Inc.," has moved to dismiss the case, which arises out of the
company's "end of late fees" program.
On April 13, 2005, Kenneth W. Edwards filed a putative class
action in the District Court of Pittsburg County, Oklahoma,
alleging fraud and a violation of Oklahoma's consumer protection
statute.
The suit sought actual damages and civil penalties. Blockbuster
removed the case to the U.S. District Court for the Eastern
District of Oklahoma.
On Nov. 17, 2005, the court ordered plaintiff's individual claim
to arbitration. On Dec. 28, 2006, plaintiff moved to dismiss
his case, according to the Blockbuster, Inc.'s March 1 Form 10-K
filing with the U.S. Securities and Exchange Commission for the
fiscal year ended Dec. 31, 2006.
The suit is "Edwards v. Blockbuster Inc., Case No. 6:05-cv-
00215-JHP," filed in the U.S. District Court for the Eastern
District of Oklahoma under Judge James H. Payne.
Representing the plaintiffs is Mark L. Edwards of Edwards Law
Firm, PO Box 1066, McAlester, OK 74502, Phone: 918-302-3700,
Fax: 918-302-3701, E-mail: medwards@edwardslawok.com.
Representing the defendants are:
(1) Theresa Noble Hill of Rhodes Hieronymus Jones Tucker &
Gable, PO Box 21100, Tulsa, OK 74121, Phone: 918-582-
173, Fax: 918-592-3390, E-mail:
thillcourts@rhodesokla.com;
(2) Michael L. Raiff, and Robert C. Walters of 2001 Ross
Ave., 3700 Trammell Crow Center, Dallas, TX 75201,
Phone: (214) 220-7700.
(3) Colin H. Tucker of Rhodes Hieronymus Jones Tucker &
Gable, P.O. Box 21100, Tulsa, OK 74121, Phone: 918-582-
1173, Fax: 918-592-3390, E-mail:
chtucker@rhodesokla.com.
CEPHALON INC: Still Faces Suit Over Patent Case Settlement
----------------------------------------------------------
Cephalon, Inc. along with Barr Laboratories Inc., Mylan
Pharmaceuticals, Inc., Teva Pharmaceuticals Inc. USA, and
Ranbaxy Laboratories Ltd., remains defendant in a litigation
pending in the U.S. District Court for the Eastern District of
Pennsylvania.
Initially, certain private parties brought a number of civil
antitrust complaints, purportedly filed as class actions against
the defendants.
The suit claims, among other things, that the patent litigation
settlements concerning PROVIGIL violate the antitrust laws of
the U.S. and certain state laws.
The proposed consolidated class action complaints have been
designated by plaintiffs, each of which seeks to certify
separate, purported classes of plaintiffs: direct purchasers of
PROVIGIL, and consumers and other indirect purchasers of
PROVIGIL.
The plaintiffs in both cases are seeking monetary damages and/or
equitable relief, according to the its Feb. 28 Form 10-K filing
with the U.S. Securities and Exchange Commission for the fiscal
year ended Dec. 31, 2006.
Cephalon, Inc. on the Net: http://www.cephalon.com.
CERIDIAN CORP: Seeks Dismissal of Consolidated Securities Suit
--------------------------------------------------------------
Ceridian Corp. filed a motion seeking for the dismissal of a
consolidated securities fraud class action filed against it in
the U.S. District Court for District of Minnesota.
Since Aug. 6, 2004, six shareholder lawsuits were filed against
the company and certain executive officers. These suits were
consolidated into a single case as, "In re Ceridian Corp.
Securities Litigation, Case No. 04-cv-03704 MJD-JGL."
This consolidated suit purports to be a class action filed on
behalf of all persons who purchased or otherwise acquired common
stock of the company between Apr. 17, 2003 and Mar. 17, 2005,
inclusive. It alleges claims against the company and certain of
its officers under Sections 10(b) and 20(a) of the U.S.
Securities Exchange Act of 1934.
Plaintiffs challenge the accuracy of certain public disclosures
made by Ceridian regarding its financial performance, and in
particular Ceridian's accounting for revenue and expenses,
accounting for capitalization, accounting for derivatives,
accounting for long-term leases, and accounting for trademarks.
Plaintiffs allege, in essence, that the company's series of
restatements constituted a violation of Section 10(b) and 20(a)
of the Securities Exchange Act of 1934.
On May 25, 2006, the court granted the company's motion to
dismiss the consolidated class action complaint and gave leave
to the plaintiffs to file an amended complaint.
An amended complaint was filed on July 14, 2006. The company
has made a motion to dismiss the amended consolidated class
action, according to its Feb. 28 Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
Dec. 31, 2006.
The suit is "In Re: Ceridian Corp. Securities Litigation, Case
No. 0:97-cv-02044-MJD-JGL," filed in the U.S. District Court in
Minnesota under Judge Michael J. Davis.
The plaintiff firms in this litigation are:
(1) Chestnut & Cambronne, P.A., 3700 Piper Jaffray Tower,
222 South Ninth Street, Minneapolis, MN, 55402, Phone:
612.339.730;
(2) Lockridge, Grindal, Nauen P.L.L.P., Suite 301, 660
Pennsylvania Avenue Southeast, Washington, DC, 20003-
4335, Phone: 202.544.9840, Fax: 202.544.9850;
(3) Milberg, Weiss, Bershad, Hynes & Lerach, LLP (S.F.,
CA), 100 Pine Street - Suite 2600, San Francisco, CA,
94111, Phone: 415.288.4545, Fax: 415.288.4534;
(4) Milberg, Weiss, Bershad, Hynes & Lerach LLP (San Diego,
CA), 600 West Broadway, 1800 One America Plaza, San
Diego, CA, 92101, Phone: 800.449.4900, E-mail:
support@milberg.com; and
(5) Savett Frutkin Podell & Ryan, P.C., Philadelphia, PA,
Phone: 800.993.3233, E-mail: sfprpc@op.net.
Representing the company are:
(i) Craig W. Gagnon, Michael E. Keyes, Oppenheimer Wolff &
Donnelly LLP, 3300 Plz VII Bldg, 45 S 7th St Ste 3300,
Mpls, MN 55402, Phone: (612) 607-7000, Fax: 612-607-
7100, E-mail: cgagnon@oppenheimer.com or
mkeyes@oppenheimer.com;
(ii) Gregory Paul Joseph, Joseph Law Office, 805 3rd Ave
31st Fl, New York, NY 10022, Phone: 212-407-1200, Fax:
1-212-407-1280 (fax), E-mail: gjoseph@josephnyc.com;
(iii) Amy J. Longo, O'Melveny & Myers, 610 Newport Center Dt
17th Fl, Newport Beach, CA 92660, Phone: 949-760-9600,
Fax: 1-949-823-6994; and
(iv) Ann Curme Shaw, Ceridian Corp, 3311 E Old Shakopee Rd
Mpls, MN 55425, Phone: 952-853-4210, Fax: 952-853-3413,
E-mail: ann.c.shaw@ceridian.com.
CHOICEPOINT INC: Parties Reach Settlement in Fla. DPPA Lawsuit
--------------------------------------------------------------
A settlement was reached in the purported class action, "Fresco,
et al. v. Automotive Directions Inc., et al.," which alleges
violation of the Driver's Privacy Protection Act and names
ChoicePoint, Inc. as one of the defendants.
The class action was filed on Aug. 11, 2003 in U.S. District
Court for the Southern District of Florida. It alleges that the
company obtained, disclosed and used information obtained from
the Florida Department of Highway Safety and Motor Vehicles
(DHSMV) in violation of DPPA.
The plaintiffs seek to represent classes of individuals whose
personal information from Florida DHSMV records has been
obtained, disclosed and used for marketing purposes or other
allegedly impermissible uses by the company without the express
written consent of the individual.
A number of the company's competitors have also been sued in the
same or similar litigation in Florida. This complaint seeks
certification as a class action, compensatory damages,
attorneys' fees and costs, and injunctive and other relief.
The company has joined with the other defendants in a motion for
judgment on the pleadings as to the plaintiffs' "obtaining"
claim. The court has not ruled on the pending motion, according
to the company's Feb. 28 Form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
Dec. 31, 2006.
After vigorously defending against the action, the defendants
engaged in court ordered mediation beginning in February 2006.
A proposed settlement agreement was filed with the court on Dec.
20, 2006, and the settling parties are waiting for the
scheduling of a hearing for preliminary approval of the
settlement, according to the regulatory filing.
The suit is "Richard Fresco, et al. v. Automotive Directions,
Inc., et al., Case No. CIV-03-61063-Martinez/Klein," filed in
the U.S. District Court for the Southern District of Florida
under Judge Jose E. Martinez with referral to Judge Ted E.
Bandstra.
Representing the plaintiffs are:
(1) Tod N. Aronovitz of Aronovitz Trial Lawyers, 150 W
Flagler Street, Suite 2700 Museum Tower, Miami, FL
33130, Phone: 305-372-2772, Fax: 375-0243, E-mail:
ta@aronovitzlaw.com; and
(2) Lawrence Dean Goodman of Devine Goodman Pallot & Wells,
777 Brickell Avenue, Suite 850, Miami, FL 33131, Phone:
305-374-8200, Fax: 374-8208, E-mail:
lgoodman@devinegoodman.com.
Representing the defendants are:
(i) Alan Graham Greer of Richman Greer Weil Brumbaugh
Mirabito & Christensen, 201 S. Biscayne Boulevard,
Suite 1000, Miami, FL 33131, Phone: 305-373-4000, Fax:
373-4099, E-mail: agreer@richmangreer.com; and
(ii) Deanna Kendall Shullman of Holland & Knight, 1 E
Broward Boulevard, Suite 1300, Fort Lauderdale, FL
33301-4811, Phone: 954-525-1000, Fax: 463-2030, E-mail:
deanna.shullman@tlolawfirm.com.
CHOICEPOINT INC: Seeks 11th Circuit Review of Securities Suit
-------------------------------------------------------------
ChoicePoint, Inc. is asking the U.S. Court of Appeals for the
11th Circuit to review a decision by the U.S. District Court for
the Northern District of Georgia to deny the company's motion to
dismiss a consolidated amended securities fraud class action
complaint filed against it.
On March 4, 2005, a purchaser of the company's securities filed
a lawsuit against the company and certain of its officers in the
U.S. District Court for the Central District of California.
The complaint alleged that the defendants violated federal
securities laws by issuing false or misleading information in
connection with the fraudulent data access.
Additional similar complaints were filed by other purchasers of
the company's securities in the U.S. District Court for the
Central District of California on March 10, 2005 and in the
Northern District of Georgia on March 11, 2005, March 22, 2005
and March 24, 2005.
By court order, the cases pending in the California were
transferred to the U.S. District Court for the Northern District
of Georgia.
By order dated Aug. 5, 2005, the court consolidated the pending
cases into a single consolidated action, "In re
ChoicePoint Inc. Securities Litigation, 1:05-CV-00686."
On Nov. 14, 2005, the court entered an order appointing the
Alaska Laborers Employers Retirement Fund as lead plaintiff for
the proposed plaintiff class.
A consolidated amended complaint was filed on Jan. 13, 2006,
seeking certification as a class action and unspecified
compensatory damages, attorneys' fees, costs, and other relief.
On March 14, 2006, the defendants filed a motion to dismiss the
consolidated amended complaint, which remains pending before the
court.
On Nov. 21, 2006, the court entered an order denying the
defendants' motion to dismiss. Thereafter, defendants moved the
court to certify its order for immediate review. The court
granted that motion on Jan. 10.
On Jan. 25, the defendants filed a petition asking the U.S.
Court of Appeals for the 11th Circuit to allow them to appeal on
an interlocutory basis. Plaintiff's response was filed on Feb.
16.
If the 11th Circuit grants defendants' petition, then the 11th
Circuit will set a briefing schedule for defendants' appeal of
the Nov. 21 Order.
The district court has administratively closed the case pending
the resolution of the interlocutory appeal. As a result, all
proceedings in the district court are currently stayed,
according to the company's Feb. 28 Form 10-K filing with the
U.S. Securities and Exchange Commission for the fiscal year
ended Dec. 31, 2006.
The suit is "In re ChoicePoint Inc. Securities Litigation, 1:05-
CV-00686," filed in the U.S. District Court for the Northern
District of Georgia under Judge Jack T. Camp.
Representing the plaintiffs are:
(1) Martin D. Chitwood of Chitwood & Harley, 1230 Peachtree
Street, N.E. 2300 Promenade II, Atlanta, GA 30309,
Phone: 404-873-3900, E-mail: mdc@classlaw.com;
(2) Edward P. Dietrich of Lerach, Coughlin, Stoia, Geller,
Rudman & Robbins, LLP, Suite 1900, 655 West Broadway,
San Diego, CA 92101, Phone: 619-231-1058, Fax: 619-231-
7423, E-mail: edd@lerachlaw.com; and
(3) Christopher Kim of Lim Ruger & Kim, Suite 2800, 1055
West 7th Street, Los Angeles, CA 90017, Phone: 213-955-
9500.
Representing the defendants is Tracy Cobb Braintwain of King &
Spalding, LLP, 1180 Peachtree Street, NE Atlanta, GA 30309-3521,
Phone: 404-572-2714, Fax: 404-572-5139, E-mail:
tbraintwain@kslaw.com.
CONAGRA FOODS: Faces Fla. Suit Over Contaminated Peanut Butter
--------------------------------------------------------------
Marion Caldarera, a Pinellas County resident, filed a $5 million
class action in the U.S. District Court for the Middle District
of Florida against ConAgra Foods and Wal-Mart Stores Inc., The
News-Press reports.
The suit was filed on behalf of more than 500 others who ate
salmonella-contaminated peanut butter processed by ConAgra in
Sylvester, Georgia and sold by retailers across the country.
According to Ms. Caldarera's attorney, Edward Zebersky of
Hollywood, the plaintiff suffered classic symptoms of salmonella
poisoning and has been for weeks. Symptoms of foodborne illness
caused by salmonella include fever, diarrhea and abdominal
cramps.
The U.S. Federal Drug Administration on Feb. 14 warned customers
not to eat the products beginning with the "2111" label, and
stores across Lee County and throughout the nation pulled the
jars and offered refunds.
The FDA had linked the salmonella to the ConAgra plant in
Sylvester and also warned customers to discard other products
that may have been tainted by the peanut butter, including Sonic
ice cream sundae toppings, Carvel ice cream toppings and J.
Hungerford Smith dessert toppings. The FDA said those companies
used the topping until Feb. 16, when the product was recalled.
According to public records, ConAgra has been sued 12 times
since the outbreak was announced and the second such filed in
Florida.
The recent suit is "Caldarera v. Conagra Foods, Inc. et al.,
Case No. 8:07-cv-00384-SCB-MSS," filed in the U.S. District
Court for the Middle District of Florida under Judge Susan C.
Bucklew, with referral to Judge Mary S. Scriven.
Representing plaintiffs is Edward H. Zebersky of Zebersky &
Payne, LLP, 4000 Hollywood Blvd., Suite 675 South, Hollywood, FL
33021, Phone: 954/989-6333, Fax: 954/989-7781, E-mail:
ezebersky@zpklaw.com.
CONAGRA FOODS: Faces Ky. Lawsuit Over Contaminated Peanut Butter
----------------------------------------------------------------
Louisville, Kentucky resident Ernest Wallace Jr. filed a lawsuit
seeking class-action status in Jefferson Circuit Court against
ConAgra Foods, claiming he became sick after eating the
company's Peter Pan peanut butter, the Louisville Courier-
Journal reports.
The suit was filed on behalf of anyone who "suffered
gastrointestinal problems" after eating Peter Pan and Great
Value peanut butter since May 1.
The lawsuit alleges that ConAgra failed to maintain proper
sanitary conditions in preparing its peanut butter, and didn't
warn people of the danger or discover that the product was
contaminated.
It requests a jury trial and unspecified compensatory and
punitive damages.
In recent weeks, tainted peanut butter has been blamed for a
salmonella outbreak that has hit 39 states, including Kentucky
and Indiana, sickening nearly 300 people and leading some
retailers to take Peter Pan and Great Value peanut butter off
shelves, the report said.
The outbreak involved jars with product codes beginning with
"2111."
According to the U.S. Food and Drug Administration, the affected
jars -- sold since last May -- were manufactured in Georgia by
ConAgra Foods.
CONAGRA FOODS: Faces Miss. Suit Over Contaminated Peanut Butter
---------------------------------------------------------------
A lawsuit was filed in the U.S. District Court for the Northern
District of Mississippi against ConAgra Foods Inc. on behalf of
the daughter of a woman who died from salmonella poisoning after
eating Peter Pan peanut butter.
The suit alleges, among other things, that ConAgra's negligence,
and its failure to comply with the requirements of the Federal
Food, Drug & Cosmetics Act contributed to the peanut butter
contamination and subsequent outbreak of salmonella.
According to the complaint, prior to the Feb. 14, 2007 recall,
the decedent ingested Peter Pan peanut butter with a product
code beginning with 2111. Shortly after consuming the peanut
butter the decedent began developing symptoms, including fever,
vomiting and diarrhea and was hospitalized at the Methodist
German Town Hospital in Memphis, Tennessee.
Treatment options were unsuccessful and the woman died from
salmonella related complications on Feb. 15, 2007. In addition
to the pain and suffering the decedent's family continues to
endure, they have also incurred significant medical expenses as
a result of this illness and death.
On Feb. 14, 2007, ConAgra Foods recalled lots of Peter Pan and
Great Value peanut butter due to salmonella contamination and
widespread reports of related illness in multiple states.
The U.S. FDA warned the public not to eat Peter Pan or Great
Value (a Wal-Mart brand manufactured by ConAgra) to avoid
becoming sick with Salmonellosis. The recalled peanut butter
jars have a product code beginning with "2111" on the jar lid.
Consumers are being advised to avoid the recalled peanut butter.
This lot of peanut butter was 1st manufactured in May 2006 and
continued through the February 2007 recall. ConAgra
manufactures both the Peter Pan and Great Value brands in the
company's Sylvester, Georgia facility.
The FDA has sent investigators to ConAgra's processing plant in
Sylvester, Georgia to review records, collect product samples
and conduct tests for Salmonella Tennessee.
On March 1, 2007, the FDA announced it found the strain of
salmonella that tainted peanut butter made at the ConAgra Foods
plant in Sylvester, Georgia. Government and industry officials
have said the contamination may have been caused by dirty jars
or equipment.
CDC Investigation into Salmonella Tennessee Outbreak
Salmonella Tennessee is a bacterium that causes illness when
ingested. The Centers for Disease Control and Prevention,
released a study on Feb. 13 that drew the connection between 288
cases of food borne illness in 39 states to consumption of
certain types of Peter Pan peanut butter.
While most infections seem to be in New York, Pennsylvania,
Virginia, Tennessee and Missouri, there are victims in almost
every state in the country. The first illness from the current
peanut butter epidemic may have occurred in August 2006. As a
result of broad epidemiological testing and recent case control
studies, the CDC was recently able to identify Peter Pan peanut
butter as the likely cause of illness.
The firms have been contacted by thousands of people who became
sick after ingesting contaminated peanut butter manufactured by
ConAgra.
The suit is "Gateley v. ConAgra Foods, Inc., Case No. 2:07-cv-
00035-WAP-SAA," filed in the U.S. District Court for the
Northern District of Mississippi under Judge W. Allen Pepper,
with referral to Judge S. Allan Alexander.
Representing plaintiffs is Patrick D. McMurtray of McMurtray &
Armistad, P.A., 1755 Lelia Drive, Suite 210, Jackson, MS 39216,
Phone: (601) 969-9999, E-mail: pmcmurtray@ma-ms.com.
DEFIBTECH LLC: Recalls Faulty Automatic External Defibrillators
---------------------------------------------------------------
Defibtech, LLC, is initiating a voluntary worldwide recall of
the Lifeline AED and ReviveR AEDTM (semi-automatic external
defibrillators).
This recall affects all Lifeline and ReviveR AEDs with software
versions 2.002 and earlier. The self-test software for these
devices may allow a self-test to clear a previously detected low
battery condition. If this situation occurs, the operator may
be unaware of the low battery, and the device may be unable to
deliver a defibrillation shock, which could result in failure to
resuscitate a patient.
Defibtech initiated notification of its distributors and
customers by letter on Feb. 22, 2007. Defibtech determined the
need for this recall after learning of three reports of
malfunctions from end users.
The company has provided a maintenance procedure that can be
used to verify functionality of the device until the software
upgrade has been installed, allowing the device to remain in
service. A copy of this maintenance procedure is being mailed
to customers. This procedure, as well as instructions on
determining the software version of a unit, can be found at
http://www.defibtech.com/fa2007.
Defibtech will provide customers with a free software upgrade to
address this issue for all affected AEDs. This software upgrade
will be able to be installed in the field where the unit is
located. The software upgrade is expected to be available
within the next 10 weeks.
Defibtech has distributed approximately 42,000 units worldwide
through distributors to end users including: schools, fire &
EMS, businesses, health clubs and hospitality companies. The
products can be identified by the words "Lifeline AED" and
"ReviveR AEDTM" on the front of the device.
For questions regarding this recall, contact your distributor or
contact Defibtech, Phone: 1-877-453-4507 or 1-203-453-4507, E-
mail: techsupport@defibtech.com.
DISCOUNT SCHOOL: Recalls 2-Sided Easels for Lead Poisoning Risks
----------------------------------------------------------------
Discount School Supply, of Monterey, California, in cooperation
with the U.S. Consumer Product Safety Commission, is recalling
about 2,500 Elite 5-in-1 Easels.
The company said the paint on the chalkboard side of the
recalled easels contains high levels of lead. Lead is toxic if
ingested by young children and can cause adverse health effects.
No injuries have been reported.
The recalled easels are two-sided, with felt and a pull-out
panel on one side and a chalkboard on the other side. The
recalled easels include the word "Jolly" at the top. Easels
with the word "Colorations" at the top of the easel are not
included in the recall.
These recalled easels were manufactured in China and are being
sold by discount School Supply catalogs and the company's Web
site from July 2004 through November 2006 for about $60.
Pictures of the recalled children's easels:
http://www.cpsc.gov/cpscpub/prerel/prhtml07/07531a.jpg
http://www.cpsc.gov/cpscpub/prerel/prhtml07/07531b.jpg
Consumers are advised to stop using the easels immediately and
contact Discount School Supply to receive a free replacement
easel.
For more information, contact Discount School Supply at (800)
293-9314 between 6 a.m. and 5 p.m. PT Monday through Friday, or
E-mail the firm at easelrecall@discountschoolsupply.com.
FREEPORT-MCMORAN: Faces Suit in Ariz. Over Phelps Dodge Deal
------------------------------------------------------------
Freeport-McMoRan Copper & Gold Inc. was named a defendant in a
purported class action filed in the Superior Court of the state
of Arizona, County of Maricopa, according to its Feb. 28 Form
10-K filing with the U.S. Securities and Exchange Commission for
the fiscal year ended Dec. 31, 2006.
The suit, "Knisley v. Phelps Dodge Corp. et al., No. CV2006-
053422," was brought on behalf of a purported class of all of
the shareholders of Phelps Dodge Corp.
Plaintiffs allege breaches of fiduciary duties by the Phelps
Dodge board of directors in connection with the merger
transaction.
The complaints allege, among other things, that the named
defendants engaged in self-dealing, obtained personal benefits
for themselves not shared equally by Phelps Dodge shareholders
and failed to disclose all material information concerning the
transaction to Phelps Dodge shareholders.
Additionally, plaintiffs also allege that the company aided and
abetted such alleged violations of fiduciary duties.
The plaintiffs seek, among other things, injunctive relief
barring consummation of the transaction and directing that the
defendants obtain a transaction, which is in the best interests
of Phelps Dodge shareholders.
Freeport McMoRan Copper & Gold, Inc. on the Net: www.fcx.com.
GENERAL REINSURANCE: Seeks Dismissal of Insurance Brokerage Suit
----------------------------------------------------------------
General Reinsurance Corp. together with other defendants in "In
re Insurance Brokerage Antitrust Litigation, MDL No. 1663," has
filed motions seeking for the dismissal of the case.
General Reinsurance is a wholly owned subsidiary of General Re
Corp., and an indirectly wholly owned subsidiary of Berkshire
Hathaway, Inc.
Berkshire, General Re, and General Reinsurance were named as
defendants in this multi-district litigation, in which
plaintiffs allege an industry-wide scheme on the part of
commercial insurance brokers and insurance companies to defraud
a purported class of insurance purchasers through bid-rigging
and contingent commission arrangements.
Plaintiffs claim that all defendants engaged in a pattern of
racketeering activity, in violation of the Racketeer Influenced
and Corrupt Organizations Act, and that they conspired to
restrain trade.
They further allege that the broker defendants breached
fiduciary duties to the plaintiffs, that the insurer defendants
aided and abetted that breach, and that all defendants were
unjustly enriched in the process.
Plaintiffs seek treble damages in an unspecified amount,
together with interest and attorneys fees and expenses. They
also seek a declaratory judgment of wrongdoing as well as an
injunction against future anticompetitive practices.
In November 2006, General Re, General Reinsurance and Berkshire,
together with the other defendants, filed motions to dismiss the
complaint which are awaiting resolution, according to Berkshire
Hathaway's March 1 Form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2006.
The suit is "In re Insurance Brokerage Antitrust Litigation, MDL
No. 1663," filed in the U.S. District Court for the District of
New Jersey under Judge Faith S. Hochberg with referral to Judge
Patty Shwartz. Representing the plaintiffs are:
(1) Thomas M. Louis of Wells Marble & Hurst, PLLC, P.O. BOX
131, JACKSON, MS 39205-0131, Phone: (601) 355-8321, E-
mail: tlouis@wellsmar.com;
(2) H. Alan Mccall of Stockwell Sievert, P.O. Box 2900,
Lake Charles, LA 70601, U.S., Phone: 337-436-9491;
(3) Ellen Meriwether of Miller Faucher & Cafferty, LLP, One
Logan Square, Suite 1700, 18TH & Cherry Streets,
Philadelphia, PA 19103, Phone: 215-864-2800, E-mail:
emeriwether@millerfaucher.com; and
(4) Douglas A. Millen, Counsel Not Admitted to USDC-NJ Bar
Much, Shelist, Freed, Denenberg, Ament & Rubenstein,
PC, 191 N. Wacker Drive, Suite 1800, Chicago, IL 60605-
1615, Phone: (312) 521-2100.
Representing the defendants are:
(i) Joseph J. Schiavone and Christopher p. Anton of Budd
Larner, PC, 150 John F. Kennedy Parkway, CN 1000 Short
Hills, NJ 07078-0999, Phone: (973) 379-4800, E-mail:
jschiavone@budd-larner.com and canton@budd-larner.com;
(ii) Catherine Florence August Johnson, Counsel Not Admitted
to USDC-NJ Bar, of Munger, Tolles & Olson, LLP, 355
South Grand Avenue, 35th Floor, Los Angeles, CA 90071-
1560, U.S., Phone: (213) 683-9100, E-mail:
kit.johnson@mto.com; and
(iii) Daniel P. Jordan of Butler, Snow, O'mara, Stevens &
Cannada, P.O. Box 22567, Jackson, MS 39225-2567, US,
Phone: 601-948-5711.
GENERAL REINSURANCE: Still Faces AIG Securities Suit in N.Y.
------------------------------------------------------------
No trial date has been set yet for the consolidated securities
class action, "In re American International Group Securities
Litigation, Case No. 04-CV-8141," which names General
Reinsurance Corp., an indirect wholly owned subsidiary of
Berkshire Hathaway, Inc., as one of the defendants.
The putative class action is brought on behalf of investors who
purchased publicly traded securities of AIG between October 1999
and March 2005.
The complaint, originally filed in April 2005, asserts various
claims against AIG and certain of its officers, directors,
investment banks and other parties, including Messrs. Ferguson,
Napier and Houldsworth (together with General Reinsurance, the
"General Re Defendants").
The complaint alleges that the General Re Defendants violated
Section 10(b) of the U.S. Securities Exchange Act and Rule 10b-5
in connection with the AIG Transaction. It seeks damages and
other relief in unspecified amounts.
General Reinsurance has answered the complaint, denying
liability and asserting various affirmative defenses.
Document production has begun, but no other discovery has taken
place. No trial date has been scheduled, according to Berkshire
Hathaway's March 1 Form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2006.
The suit is "In Re American International Group, Inc. Securities
Litigation, Case No. 1:04-cv-08141-JES," filed in the U.S.
District Court for the Southern District of New York under Judge
John E. Sprizzo.
Representing the plaintiffs are:
(1) Thomas A. Dubbs of Goodkind Labaton Rudoff & Sucharow
LLP, 100 Park Avenue, New York, NY 10017, Phone: 212-
907-0700, Fax: 212-818-0477, E-mail:
tdubbs@glrslaw.com; and
(2) Louis Gottlieb, Goldman Gruder & Wood, 200 Connecticut
Avenue, Norwalk, CT 06854, Phone: (212) 907-0872, Fax:
(212) 883-7072, E-mail: lgottlieb@glrslaw.com.
Representing the company are:
(i) Steven Ian Froot of Boies, Schiller & Flexner, LLP, 570
Lexington Avenue, New York, NY 10022, Phone: (212)-446-
2300, Fax: (212)-446-2350, E-mail: sfroot@bsfllp.com;
and
(ii) George Abraham Zimmerman, Skaddden, Arps, Slate,
Meagher & Flom LLP (NYC), Four Times Square, New York,
NY 10036, Phone: (212) 735-2000 x2047, Fax: (212) 735-
2000, E-mail: gzimmerm@skadden.com.
GOLD BANC: Settles Farmers Lawsuit Over Loan Fees, Interest
-----------------------------------------------------------
Law firms Susman Godfrey LLP and Mitchell & DeClerck have
settled a class action filed by farmers against Gold Bank and
its parent Gold Banc Corp. in Kingfisher County, Oklahoma.
"We've just sent checks of $20,000.00 or more to 43 of the 220
some farmers or farm operations who submitted claim forms,"
reports Terry Oxford, the senior lawyer at Susman Godfrey's
office in Dallas and lead counsel on the case.
"Once we have all of the information, we will send a second
check in the next two to three months that, for many, could
nearly double what they've already received." Ms. Oxford
confirms that more than 200 of the farmers were sent checks for
at least $1,000.00. "The vast majority will net several
thousand dollars or more after the final checks are cut," he
says.
The lawsuit accused the bank of charging excessive and illegal
interest rates and fees on federally guaranteed Farm Service
Agency loans. Even after attorneys' fees and case expenses, the
settlement has more than $5 million to be distributed among the
224 farmers.
The plaintiffs in this case allege that Gold Banc's subsidiary
bank violated Farm Service Agency (FSA) regulations by charging
interest rates and fees on FSA guaranteed agricultural loans
higher than the interest rates and fees it charged its average
agricultural customers. The court's order certified the case as
a class action covering "those agricultural customers who
obtained a FSA guaranteed loan between Jan. 1, 1999 to Feb. 29,
2004," (Class Action Reporter, June 9, 2005).
According to Susman Godfrey's Jonathan Bridges, who assisted
with the case, dozens of class members will end up with $50,000
or more. "The payout depends mostly on the amount of the
individual loans and the interest charges," Mr. Bridges
explains.
Wayne Janzen, one of the farmers who borrowed from Gold Bank,
served as one of the class representatives in the lawsuit. The
class consisted of farmers who had FSA-guaranteed loans with
Gold Bank during a five-year period.
"This whole situation is hard to talk about, but all I can say
is it feels good to get to this point. It's a huge relief,"
says Janzen.
"The settlement was large enough that the several hundred
farmers involved will get back every dime that the bank
overcharged them between January 1999 and February 2004. We
think it is a great outcome," says Michael C. Bigheart, with
Mitchell & DeClerck.
The suit is "Wayne E. Janzen, et al., vs. Gold Banc Corp., Inc.,
et al."
For more information, contact Jonathan Bridges of Susman Godfrey
L.L.P., Phone: +1-214-754-1925, E-mail:
jbridges@susmangodfrey.com, Website:
http://www.susmangodfrey.com;or Michael C. Bigheart of Mitchell
& DeClerck, Phone: +1-580-234-5144, E-mail: mcb@mdpllc.com.
HALLIBURTON CO: Continues to Face Lawsuit by LogCAP Workers
-----------------------------------------------------------
Halliburton Co. remains a defendant in a suit related to the
company's worldwide U.S. Army logistics contracts, LogCAP,
according to the company's Feb. 27 Form 10-K filing with the
U.S. Securities and Exchange Commission for the fiscal year
ended Dec. 31, 2006.
During the fourth quarter of 2005, a group of present and former
employees working on the company's LogCAP contract in Iraq and
elsewhere filed a class action alleging that KBR, Inc., part of
Halliburton, wrongfully failed to pay time and a half for hours
worked in excess of 40 per work week and that "uplift" pay,
consisting of a foreign service bonus, an area differential, and
danger pay, was only applied to the first 40 hours worked in any
work week.
The class alleged by plaintiffs consists of all current and
former employees on the LogCAP contract from December 2001 to
present. The basis of plaintiffs' claims is their assertion
that they are intended third-party beneficiaries of the LogCAP
contract, and that the LogCAP contract obligated KBR to pay time
and a half for all overtime hours.
On Sept. 26, 2006, the court granted the motion to dismiss
insofar as claims for overtime pay and "uplift" pay are
concerned, leaving only a contractual claim for miscalculation
of employees' pay. That claim remains open.
HSBC FINANCE: Discovery Begins in Interchange Fee Litigation
------------------------------------------------------------
Discovery has started in the class action, "In re Payment Card
Interchange Fee and Merchant Discount Antitrust Litigation, MDL-
1720," which names HSBC Finance Corp. and two of its affiliates
as defendants.
Since June 2005, the company, HSBC North America Holdings Inc.,
and HSBC Holdings plc, as well as other banks and the Visa and
Master Card associations, were named as defendants in four class
actions filed in Connecticut and the Eastern District of New
York. The suits are:
-- "Photos Etc. Corp. et al. v. Visa U.S.A., Inc., et al.,
(D. Conn. No. 3:05-CV-01007 (WWE))";
-- "National Association of Convenience Stores, et al. v.
Visa U.S.A., Inc., et al. (E.D.N.Y. No. 05-CV 4520
(JG))";
-- "Jethro Holdings, Inc., et al. v. Visa U.S.A., Inc. et
al. (E.D.N.Y. No. 05-CV-4521 (JG))"; and
-- "American Booksellers Ass'n v. Visa U.S.A., Inc. et al.
(E.D.N.Y. No. 05-CV-5391 (JG))."
Numerous other complaints containing similar allegations -- in
which no HSBC entity is named -- were filed across the country
against Visa, MasterCard and other banks.
These actions principally allege that the imposition of a no-
surcharge rule by the associations and/or the establishment of
the interchange fee charged for credit card transactions causes
the merchant discount fee paid by retailers to be set at
supracompetitive levels in violation of the Federal antitrust
laws.
In response to motions of the plaintiffs on Oct. 19, 2005, the
Judicial Panel on Multidistrict Litigation issued an order
consolidating these suits and transferred all of the cases to
the Eastern District of New York.
The consolidated case is known as "In re Payment Card
Interchange Fee and Merchant Discount Antitrust Litigation, MDL
1720, E.D.N.Y." The plaintiffs filed a consolidated amended
complaint on April 24, 2006.
Discovery has begun, according to the company's March 5 Form 10-
K filing with the U.S. Securities and Exchange Commission for
the fiscal year ended Dec. 31, 2006.
The suit is "In re Payment Card Interchange Fee and Merchant
Discount Antitrust Litigation, MDL-1720, Master Docket No. 1:05-
md-01720-JG-CLP," filed in the U.S. District Court for the
Eastern District of New York under Judge John H. Gleeson.
Representing the company is David Sapir Lesser of Wilmer Cutler
of Pickering Hale & Dorr, LLP, 399 Park Avenue, New York, NY
10022, Phone: 212-230-8800, Fax: 212-230-8811, E-mail:
david.lesser@wilmerhale.com.
HSBC FINANCE: Expert Discovery in Ill. Securities Suit Ongoing
--------------------------------------------------------------
Expert discovery in a consolidated securities class action
pending in the U.S. District Court for the Northern District of
Illinois against HSBC Finance Corp. and other defendants is
expected to end by Sept. 14.
In August 2002, the company restated previously reported
consolidated financial statements. The restatement related to
certain MasterCard and Visa co-branding and affinity credit card
relationships and a third-party marketing agreement, which were
entered into between 1992 and 1999. All were part of the
company's Credit Card Services segment.
In consultation with its prior auditors, Arthur Andersen LLP,
the company treated payments made in connection with these
agreements as prepaid assets and amortized them in accordance
with the underlying economics of the agreements.
Its current auditor, KPMG LLP, advised the company that, in its
view, these payments should have either been charged against
earnings at the time they were made or amortized over a shorter
period of time.
The restatement resulted in a $155.8 million, after-tax,
retroactive reduction to retained earnings at Dec. 31, 1998. As
a result of the restatement, and other corporate events,
including, e.g., the 2002 settlement with 50 states and the
District of Columbia relating to real estate lending practices,
HSBC Finance Corp., and its directors, certain officers and
former auditors, have been involved in various legal
proceedings, some of which purport to be class actions.
A number of these actions allege violations of federal
securities laws, were filed between August and October 2002, and
seek to recover damages in respect of allegedly false and
misleading statements about the company's common stock.
These legal actions have been consolidated into a single
purported class action, "Jaffe v. Household International, Inc.,
et al., No. 02 C 5893 (N.D. Ill., filed Aug. 19, 2002)." A
consolidated and amended complaint was filed on March 7, 2003.
On Dec. 3, 2004, the court signed the parties' stipulation to
certify a class with respect to the claims brought under Section
10 and Section 20 of the U.S. Securities Exchange Act of 1934.
The parties stipulated that plaintiffs will not seek to certify
a class with respect to the claims brought under Section 11 and
Section 15 of the Securities Act of 1933 in this action or
otherwise.
The amended complaint purports to assert claims under the
federal securities laws, on behalf of all persons who purchased
or otherwise acquired the company's securities between Oct. 23,
1997 and Oct. 11, 2002, arising out of alleged false and
misleading statements in connection with the company's sales and
lending practices, the 2002 state settlement agreement referred
to above, the restatement and the HSBC merger.
The amended complaint, which also names as defendants Arthur
Andersen LLP, Goldman, Sachs & Co., and Merrill Lynch, Pierce,
Fenner & Smith, Inc., fails to specify the amount of damages
sought.
In May 2003, the company, and other defendants, filed a motion
to dismiss the complaint. On March 19, 2004, the court granted
in part, and denied in part the defendants' motion to dismiss
the complaint.
The court dismissed all claims against Merrill Lynch, Pierce,
Fenner & Smith, Inc. and Goldman Sachs & Co. The court also
dismissed certain claims alleging strict liability for alleged
misrepresentation of material facts based on statute of
limitations grounds.
The claims that remain against some or all of the defendants
essentially allege the defendants knowingly made a false
statement of a material fact in conjunction with the purchase or
sale of securities, that the plaintiffs justifiably relied on
such statement, the false statement(s) caused the plaintiffs'
damages, and that some or all of the defendants should be liable
for those alleged statements.
On Feb. 28, 2006, the court also dismissed all alleged Section
10 claims that arose prior to July 30, 1999, shortening the
class period by 22 months.
The final discovery cut-off has been set for Jan. 31. Expert
discovery is expected to conclude on Sept. 14, according to the
company's March 5 Form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2006.
Separately, one of the defendants, Arthur Andersen, entered into
a settlement of the claims against Andersen. This settlement
received court approval in April 2006.
The suit is "Jaffe v. Household Int'l Inc., et al., case no.
1:02-cv-05893," filed in the U.S. District Court for the
Northern District of Illinois under Judge Ronald A. Guzman.
Representing the plaintiffs is Gary L. Specks, Kaplan, Fox &
Kilsheimer LLP, 203 North LaSalle Street, Suite 2100, Chicago,
IL 60601, Phone: (312) 558-1584.
MAMMA.COM INC: N.Y. Court Approves $3.15M Securities Suit Deal
--------------------------------------------------------------
The U.S. District Court for the Southern District of New York
issued an order on March 1 preliminarily approving a proposed
settlement of a consolidated securities class action filed
against Mamma.com Inc.
Among other things, the order directs that on or before, March
9, the company "shall pay and/or cause to be paid $3,150,000
into escrow for the benefit of Plaintiffs and the Class."
Under the settlement agreement, the company is responsible for
paying $650,000 and the company's insurance carrier for paying
the balance of the Cash Settlement Amount.
The order provides for notice of the proposed settlement to be
mailed by the court appointed escrow agent to class members by
March 14, 2007.
Deadline to file for exclusion and objection is June 14, 2007.
A hearing has been scheduled for July 9, 2007 at 2:00 p.m., at
which objections to the settlement may be heard in connection
with the court's consideration of whether the settlement is fair
and all procedural requisites have been met.
Following that hearing, the court will make a final
determination as to whether to approve the settlement. Upon such
final approval, the amount paid into escrow, along with any
interest earned, would be distributed as provided under the
settlement to pay class members, plaintiffs' attorney fee, and
the costs of claims administration.
The securities class actions filed against Mamma.com Inc. were
on behalf of purchasers of Mamma.com Inc. publicly traded
securities between March 2, 2004 and Feb. 15, 2005.
The complaints charge Mamma.com and certain of its officers and
directors with violations of the U.S. Securities Exchange Act of
1934.
The complaints allege that during the class period, defendants
caused Mamma.com's shares to trade at artificially inflated
levels through the issuance of false and misleading financial
statements.
As a result of this inflation, Mamma.com was able to complete a
private offering, raising proceeds of $16.6 million on the sale
of stock and warrants in June 2004.
On November 9, 2006, Mamma.com Inc. entered into an agreement to
settle the class action (Class Action Reporter, Nov. 10, 2006).
Under the terms of the settlement agreement, plaintiffs would
receive $3.15 million, $2.5 million of which would be paid by
the company's insurance carrier and $650,000 by the company.
The settlement resolves all claims asserted against the company
and the individual officer defendants. It contains no admission
of wrongdoing by the company or the officers of the company who
are individual defendants.
The first identified complaint is "Montoya v. Mamma.Com Inc. et
al., Case No. 1:05-cv-02313-HB," filed in the U.S. District
Court for the Southern District of New York under Judge Harold
Baer.
Representing defendants are:
(1) Jill C. Anderson, 311 South Wacker Drive, Suite 3000,
Chicago, IL 60606, Phone: 312-321-4200;
(2) Barry H. Berke and Yehudis S. Lewis, both of Kramer
Levin Naftalis & Frankel, LLP, 1177 Avenue of the
Americas, New York, NY 10036, Phone: 212-715-9100 or
212-715-7538, Fax: 212-715-8000, E-mail:
bberke@kramerlevin.com or ylewis@kramerlevin.com;
(3) Jason Brown of Ropes & Gray, LLP (Rockefeller), 45
Rockefeller Centre, New York, NY 10111, Phone: (212)
841-0478, Fax: 212 841 5725, E-mail:
jabrown@ropesgray.com;
(4) Tracy Lynn Cole of Baker & Hostetler LLP (NYC), 666
Fifth Avenue, 16th Floor, New York City, NY 10103,
Phone: (212) 589-4228, Fax: (212) 589-4201, E-mail:
tcole@bakerlaw.com;
(5) David Usher Gourevitch of the Law Office of David
Gourevitch, P.C, 228 East 45th Street, 17th Floor, New
York, NY 10022, Phone: (212) 355-1300, Fax: (212) 355-
1531, E-mail: david@gourevitchlaw.com; and
(6) David Charles Gustman, Jr. of Freeborn & Gustman, Jr.,
311 South Wacker Drive, Suite 3000, Chicago, Il 60606-
6677.
Representing plaintiffs are:
(1) Matthew Keith Handley, Daniel S. Sommers and Steven
Jeffrey Toll, all of Cohen, Milstein, Hausfeld & Toll,
PLLC (DC), 1100 New York Avenue, N.W. West Towen #500,
Washington, D.C., DC 20005, Phone: (202)-408-4600,
Fax: (202)-408-4699, E-mail: mhandley@cmht.com or
stoll@cmht.com;
(2) Catherine A. Torell of Cohen, Milstein, Hausfeld &
Toll, P.L.L.C., 150 East 52nd Street, New York, NY
10022, Phone: 212-838-7797, Fax: 212-838-7745, E-mail:
ctorell@cmht.com;
(3) Samuel Howard Rudman of Lerach, Coughlin, Stoia,
Geller, Rudman & Robbins, LLP(LIs), 58 South Service
Road, Suite 200, Melville, NY 11747, Phone: 631-367-
7100, Fax: 631-367-1173, E-mail:
srudman@lerachlaw.com;
(4) Steven G. Schulman, Daniel Bernard Scotti and Peter
Edward Seidman, all of Milberg Weiss Bershad &
Schulman LLP (NYC), One Pennsylvania Plaza, New York,
NY 10119, Phone: 212-946-9356 or 212-725-1290 or (212)
613-5625, Fax: 212-273-4406 or 212-868-1229, E-mail:
sschulman@milbergweiss.com or dscotti@milberg.com or
pseidman@milberg.com; and
(5) Richard A. Speirs of Zwerling, Schachter & Zwerling
(Madison Avenue), 41 Madison Avenue, New York, NY
10010, Phone: 2122233900, Fax: 2123715969, E-mail:
rspeirs@zsz.com.
PEMSTAR INC: Discovery Proceeds in Minn. Securities Fraud Suit
--------------------------------------------------------------
PEMSTAR, Inc., a recent acquisition of Benchmark Electronics,
Inc., remains a defendant in a purported securities fraud class
action pending in the U.S. District Court for the District Court
of Minnesota.
On June 16, 2005, an individual shareholder filed a putative
class action against the company and certain of its current
officers and directors.
The lawsuit, "The Cornelia I. Crowell GST Trust v. PEMSTAR,
Inc., et al., Case No. 05-CV-01182 - JMR/FLN," alleges
violations of Section 10(b) and Section 20(a) of the U.S.
Securities Exchange Act of 1934 and Section 11 of the Securities
Act of 1933.
An amended complaint was filed on Nov. 28, 2005, which set forth
the claim and established that the action was going forward with
a lead plaintiff and lead counsel for the plaintiff class.
Plaintiff alleges, in essence, that the defendants defrauded the
company's shareholders by failing to timely disclose the
circumstances around the discrepancies in the accounting of the
Mexico facility that generated a restatement.
The suit also alleges that the registration statement filed by
the company in connection with a secondary offering contained
false, material misrepresentations.
Plaintiff seeks to represent a class of persons who purchased
company stock from Jan. 30, 2003 to Jan. 12, 2005, inclusive.
An amended consolidated complaint was filed Jan. 9, 2006. The
amended complaint does not specify an amount of damages.
Benchmark Electronics reported no development in the case at its
March 1 Form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2006.
The suit is "The Cornelia I. Crowell GST Trust v. PEMSTAR, Inc.,
et al., Case No. 0:05-cv-01182-JMR-FLN," filed in the U.S.
District Court for the District of Minnesota under Judge James
M. Rosenbaum with referral to Judge Franklin L. Noel.
Representing the plaintiffs are:
(1) Eric J. Belfi of Murray Frank & Sailer, LLP, 275
Madison Ave., Ste. 801, New York, NY 10016, Phone: 212-
682-5434, E-mail: ebelfi@murrayfrank.com;
(2) 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; and
(3) Michael Goldberg of Glancy Binkow & Goldberg, LLP, 1801
Avenue of the Stars, Ste. 311, Los Angeles, CA 90067,
Phone: 310-201-9160, E-mail: info@glancylaw.com.
Representing the defendants are, Theresa M. Bevilacqua, Peter W.
Carter and Bryan C. Keane of Dorsey & Whitney, LLP, 50 S. 6th
St., Ste. 1500, Minneapolis, MN 55402-1498, Phone: 612-340-7883
and 612-340-2600 Fax: 612-340-2868, E-mail:
bevilacqua.theresa@dorsey.com, carter.peter@dorsey.com and
keane.bryan@dorsey.com.
QUOVADX INC: Col. Court Approves $9M Securities Suit Settlement
---------------------------------------------------------------
Judge Richard P. Matsch of the United States District Court for
the District of Colorado, issued a final judgment approving in
all respects a $9.0 million settlement of the class action
"Heller v. Quovadx, Inc., et al., Case No. 1:04-cv-00665-RPM,"
and dismissed with prejudice all claims alleged in the action
against the company and the individual defendants.
Under the terms of the approved settlement, class members and
their counsel received $9 million in exchange for their release
of the company and the individual defendants, with prejudice, of
all claims under Sections 10b and 20(a) of the U.S. Securities
Exchange Act of 1934. Of the $9.0 million settlement, Quovadx
contributed $2.0 million, and its insurance carriers contributed
$7.0 million.
On Mar. 18, 2004, a purported class action complaint "Smith v.
Quovadx, Inc., et al., Case No. 04-M-0509," was filed against
the company its former chief executive officer and its former
chief financial officer.
The complaint alleged violations of Section 10(b) and Section
20(a) of the U.S. Securities Exchange Act of 1934, as amended,
purportedly on behalf of all persons who purchased Quovadx
common stock from Oct. 22, 2003 through Mar. 15, 2004. The
claims were based upon allegations the company:
-- purportedly overstated its net income and earnings per
share during the class period;
-- purportedly recognized revenue from contracts between
the company and Infotech Networks Group (Infotech)
prematurely; and
-- purportedly lacked adequate internal controls and was
therefore unable to ascertain the financial condition
of the company.
The action sought damages against the defendants in an
unspecified amount. Thereafter, eight additional, nearly
identical class action complaints were filed in the same court
based on the same facts and allegations.
Subsequently, all but one of the actions, entitled, "Heller v.
Quovadx, Inc., et al., Case No. 04-M-0665 (OES) (D. Colo.)," was
dismissed.
On June 10, 2004, the plaintiff in the Heller case filed a first
amended complaint, which asserts the same claims as those
asserted in the original complaint, and includes allegations
regarding the company's accounting for certain additional
transactions. On Sept. 8, 2004, the court approved the
appointment of David Heller as lead plaintiff.
On Sept. 29, 2004, the court denied defendants' motions to
dismiss the first amended complaint and approved the appointment
of Mr. Heller's counsel as lead plaintiff's counsel.
On Oct. 14, 2004, the company and the other defendants filed
answers to the first amended complaint, denying allegations of
wrongdoing and asserting various affirmative defenses.
On April 12, 2005, the court issued an order certifying as a
class all persons (except insiders) who purchased or otherwise
acquired Quovadx stock on the open market between Oct. 22, 2003
and Mar. 15, 2004. On Jan. 13, 2005, the court entered a
scheduling order in the case.
In November 2005, the court vacated the Jan. 13, 2005 scheduling
order, in anticipation that the court would enter a coordinated
scheduling order in conjunction with a scheduling order in
"Special Situations Fund III, L.P., et al. v. Quovadx, Inc., et
al., Case No. 1:04-cv-01006-RPM."
A scheduling conference was held on Feb. 24, 2006, at which the
court further delayed scheduling for thirty days to allow the
parties time to complete settlement negotiations. No trial date
has been set.
On Dec. 13 and 14, 2005, a voluntary mediation was held among
plaintiffs in each of the Heller, Special Situations Fund and
derivative cases; the company; the individual director
defendants; the former officer defendants; and the various
director and officer insurance carriers.
As a result of the mediation and subsequent discussions, the
parties reached a preliminary understanding to settle the Heller
case and the derivative cases.
Additionally, the company reached an understanding with the
director and officer insurance carriers for a settlement under
the applicable policies.
These understandings, including the understanding with the
insurance carriers and the former officers, were contingent on
material agreements among the parties, which were not achieved
until late in March 2006.
Final agreements among the various parties ultimately were
reached and the Memorandum of Understanding documenting the
settlement with the plaintiffs in the Heller case was executed
as of Apr. 4, 2006.
Under the terms of the settlement MOU, the plaintiffs will
receive $10.0 million in exchange for their release of the
company and the individual defendants, with prejudice, of all
claims under Sections 10b and 20(a) of the Securities and
Exchange Act of 1934.
As of Mar. 31, 2006, the company accrued $3.0 million as a
settlement expense. In April the company paid that sum, and its
insurance carriers paid $7.0 million, into a settlement fund
established by the lead plaintiff's counsel.
On July 25, 2006, the parties executed the stipulation of
settlement, which was submitted to the court for preliminary
approval.
The agreement excluded claims made under Sections 11 and 15 of
the Securities Act, which have been brought in another class
action lawsuit, the Special Situations Fund lawsuit, which also
arose out of the company's 2004 restatement of financial results
and is still pending.
The agreement purported to include any claims under Section
10(b) that the Special Situations Fund class plaintiffs might
have.
Refusal and Modification of Proposed Settlement
On Oct. 11, 2006, the court denied approval of the Heller
settlement agreement on the grounds that the proposed settlement
purported to settle claims on behalf of a settlement class that
is broader than the class that was certified by the court for
trial purposes -- namely, the inclusion of the Special
Situations Fund class plaintiffs to the extent of their Section
10(b) claims.
The parties in the Heller case have subsequently reached a
modified agreement in principle in which the settlement class
members would receive $9.0 million in exchange for the release,
with prejudice, of their claims against the company and the
individual defendants under Sections 10(b) and 20(a) of the
Exchange Act (Class Action Reporter, Nov. 9, 2006).
This modified agreement would exclude all potential claims by
the Special Situations Fund class plaintiffs.
In a related agreement, the Heller plaintiffs have
unconditionally returned $1 million to the company from the
settlement fund as an excess payment under the modified
settlement agreement.
As a result of this refund, the company recorded this $1 million
recovery in the third quarter financial statements and reduced
its previously recorded settlement accrual of $3 million to $2
million.
The suit is "Heller v. Quovadx, Inc., et al., Case No, 1:04-cv-
00665-RPM," filed in the U.S. District Court for the District of
Colorado, under Judge Richard P. Matsch.
Representing defendants are:
(1) Frederick J. Baumann of Rothgerber, Johnson & Lyons,
LLP-Denver, United States District Court Box 11, 1200
Seventeenth Street, One Tabor Center, #3000, Denver, CO
80202-5855, Phone: 303-628-9542, Fax: 303-623-9222, E-
mail: fbaumann@rothgerber.com;
(2) Hugh Gottschalk, John Mark Vaught and Michael T.
Williams, all of Wheeler Trigg Kennedy, LLP, 1801
California Street, #3600 Denver, CO 80202, Phone: 303-
244-1858 or 303-244-1800 or 303-244-1867, Fax: 303-244-
1879 or 303-256-3867, E-mail: gottschalk@wtklaw.com or
vaught@wtklaw.com or williams@wtklaw.com;
(3) John Alonzo Hutchings and Adam Philip Stapen both of
Dill, Dill, Carr, Stonbraker & Hutchings, PC, 455
Sherman Street, #300 Denver, CO 80203, Phone: 303-777-
3737, Fax: 303-777-3823, E-mail:
hutchings@dillanddill.com or astapen@dillanddill.com;
(4) Nina F. Locker of Wilson, Sonsini, Goodrich & Rosati-
Palo Alto, CA, 650 Page Mill Road, Palo Alto, CA 94304-
1050, Phone: 650-493-9300, Fax: 650-565-5100, E-mail:
nlocker@wsgr.com; and
(5) John Peter Stigi, III of Sheppard Mullin Richter &
Hampton, LLP-Los Angeles, 333 South Hope Street, 48th
Floor, Los Angeles, CA 90071-1448, Phone: 213-620-1780,
Fax: 213-620-1398, E-mail: jstigi@sheppardmullin.com.
Representing plaintiffs are:
(1) Joy Ann Bull of Lerach Coughlin Stoia Geller Rudman &
Robbins, LLP-SD CA, 655 West Broadway, #1900 San Diego,
CA 92101, Phone: 619-231-1058, Fax: 619-231-7423, E-
mail: joyb@lerachlaw.com;
(2) Dennis Jeremy Herman, Jeffrey W. Lawrence and Ex Kano
S. Sams, all of Lerach Coughlin Stoia Geller Rudman &
Robbins, LLP-SF CA, 100 Pine Street, #2600 San
Francisco, CA 94111, Phone: 415-288-4545, Fax: 415-288-
4534, E-mail: dherman@lerachlaw.com or
jeffreyl@lerachlaw.com or exkanos@lerachlaw.com; and
(3) Kip Brian Shuman of Shuman & Berens, LLP, 801 East 17th
Avenue, Denver, CO 80218-1417, Phone: 303-861-3003,
Fax: 303-830-6920, E-mail: kip@shumanberens.com.
RJR TOBACCO: Opposes Amendment in N.C. ERISA Violations Suit
------------------------------------------------------------
Defendants in the class action, "Tatum v. The RJR Pension
Investment Committee," have opposed a motion to amend a
complaint filed in the U.S. District Court for the Middle
District of North Carolina.
On May 13, 2002, an employee of R. J. Reynolds Tobacco Co. (RJR)
filed a class action in the U.S. District Court for the Middle
District of North Carolina, alleging that the defendants, RJR,
R.J. Reynolds Tobacco Holdings, Inc., The R.J.R. Pension
Investment Committee of the R. J. Reynolds Tobacco Co. Capital
Investment Plan and the RJR Pension Investment Committee,
violated the Employee Retirement Income Security Act of 1974
The actions about which the plaintiff complains stem from a
decision made in 1999 by RJR Nabisco Holdings Corp.,
subsequently renamed Nabisco Group Holdings Corp., referred to
as NGH, to spin off RJR, thereby separating NGH's tobacco
business and food business.
As part of the spin-off, the 401(k) plan for the previously
related entities had to be divided into two separate plans for
the now separate tobacco and food businesses. The plaintiff
contends that the defendants violated ERISA by not overriding an
amendment to RJR's 401(k) plan requiring that, prior to Feb. 1,
2000, the stock funds of the companies involved in the food
business, NGH and Nabisco Holdings Corp., referred to as
Nabisco, be eliminated as investment options from RJR's 401(k)
plan.
In his complaint, the plaintiff requests, among other things,
that the court require the defendants to pay as damages to the
RJR 401(k) plan an amount equal to the subsequent appreciation
that was purportedly lost as a result of the liquidation of the
NGH and Nabisco funds.
On July 29, 2002, the defendants filed a motion to dismiss,
which the court granted on Dec. 10, 2003. On Jan. 7, 2004, the
plaintiff appealed to the U.S. Court of Appeals for the Fourth
Circuit, which, on Dec. 14, 2004, reversed the dismissal of the
complaint and remanded the case for further proceedings.
On Jan. 20, 2005, the defendants filed a second motion to
dismiss on other grounds, which remains pending. The parties
have filed supplemental briefs regarding the motion to dismiss.
On June 6, 2006, the plaintiff filed a motion to amend the
complaint to name as party defendants six individuals who were
members of the two defendant committees. The defendants have
opposed that motion, which remains pending.
The suit is "Tatum v. R.J.R. Pension, et al., Case No. 1:02-cv-
00373-NCT," filed in the U.S. District Court for the Middle
District of North Carolina under Judge N.C. Tilley, Jr.
Representing the plaintiffs are:
(1) Lisa Belenky of Lewis Feinberg Renaker & Jackson, P.C.,
1330 Broadway, Ste. 1800, Oakland, CA 94612, Phone:
510-839-6824;
(2) Robert M. Elliot of Elliot Pishko Morgan, P.A., 426 Old
Salem Rd., Winston-Salem, NC 27101, Phone: 336-724-
2828, Fax: 336-714-4499, E-mail: rmelliot@epmlaw.com;
and
(3) James M. Fingerg of Leiff Cabraser Heimann & Bernstein,
LLP, 275 Battery St., 30th Floor, San Francisco, CA
94111-3339, Phone: 415-956-1000.
Representing the defendants is Adam H. Charnes of Kilpatrick
Stockton, L.L.P., 1001 W. Fourth St., Winston-Salem, NC 27101.
Phone: 336-607-7382, Fax: 336-734-2602, E-mail:
acharnes@kilpatrickstockton.com.
SENDTEC INC: Fla. Judge Dismisses Securities Fraud Lawsuit
----------------------------------------------------------
The Honorable Paul C. Huck of the U.S. District Court for the
Southern District of Florida dismissed a putative class action
filed against SendTec, Inc., formerly known as RelationServe
Media, Inc.
On July 27, 2006, RelationServe Media announced that it had
completed the change of its name and symbol to SendTec, Inc. On
or about Aug. 31, 2006, an action was commenced in the U.S.
District Court for the Southern District of Florida (Case No.
06-61327) by Richard F. Thompson as putative class
representatives against the company and certain former officers
and directors of the company alleging securities laws violations
in connection with the purchase of company stock during the
period May 24, 2005 to the present.
The complaint alleges that RelationServe and the individual
Defendants violated U.S. securities laws, and the securities
laws of the states of Florida and Indiana, causing an artificial
inflation of RelationServe's stock process.
According to the complaint, RelationServe made false and
misleading statements by failing to disclose that it was selling
its securities through unregistered and commissioned agents and
broker/dealers in violation of state and federal law, thereby
creating a substantial risk of civil liability for damages
and/or the rescission of stock purchases.
In February, the U.S. District Court for the Southern District
of Florida appointed Richard F. Thompson and L. Alan Jacoby as
co-lead plaintiffs in a securities fraud class action against
SendTec, Inc.
The court also approved the plaintiffs' selection of Cohen &
Malad, LLP, as lead counsel, and approved plaintiffs' selection
of Friendman, Rosenwasser & Goldbaum, P.A. as liaison counsel.
By the terms of the court's recent order, the plaintiffs were
given leave to file a new complaint on or before March 19, 2007.
The suit is "Thompson v. Relationserve Media, et al., Case No.
0:06-cv-61327-PCH," filed in the U.S. District Court for the
Southern District of Florida under Judge Paul C. Huck with
referral to Judge Andrea M. Simonton.
Representing the plaintiffs are:
(1) Cohen & Malad, LLP, 1 Indiana Square, Suite 1400,
Indianapolis, IN 46204, Phone: 317-636-6481; and
(2) Friedman Rosenwasser & Goldbaum, 5355 Town Center Road,
Suite 801, Boca Raton, FL 33486-1092, Phone: 561-395-
5511, Fax: 368-9274, E-mail: kgoldbaum@frglaw.com.
Representing the defendants are:
(i) Genovese Joblove & Battista, 100 SE 2nd Street, Suite
4400, Miami, FL 33131, Phone: 305-349-2300, Fax: 349-
2310, Web site: http://www.gjb-law.com;and
(ii) Haynes & Boone, LLP, 153 E. 53rd Street, Suite 4900,
New York, NY 10022, US, Phone: 212-659-4980, Web site:
http://www.haynesboone.com.
TOBACCO LITIGATION: Two Antitrust Cases Remain in State Courts
--------------------------------------------------------------
Two remaining state court antitrust cases filed on behalf of
indirect purchasers of tobacco are pending in Kansas and in New
Mexico against cigarette manufacturers as of February 2007.
A number of tobacco wholesalers and consumers have sued U.S.
cigarette manufacturers, including R. J. Reynolds Tobacco Co.
(RJR) and Brown & Williamson Holdings, Inc. (B&W), in federal
and state courts, alleging that cigarette manufacturers combined
and conspired to set the price of cigarettes in violation of
antitrust statutes and various state unfair business practices
statutes.
In these cases, the plaintiffs asked the court to certify the
lawsuits as class actions on behalf of other persons who
purchased cigarettes directly or indirectly from one or more of
the defendants. The federal cases against RJR Tobacco and B&W
were consolidated and sent by the Judicial Panel on Multi-
District Litigation for pretrial proceedings in the U.S.
District Court for the Northern District of Georgia.
The court certified a nation-wide class of direct purchasers on
Jan. 27, 2001. The court granted the defendants' motion for
summary judgment in the consolidated federal cases on July 11,
2002, and the U.S. Court of Appeals for the 11th Circuit
affirmed that decision on Sept. 22, 2003. As of Feb. 2, 2007,
all state court cases on behalf of indirect purchasers have been
dismissed, except for two cases pending in Kansas and in New
Mexico.
In "Smith v. Philip Morris Cos., Inc., a case filed in February
2000 and pending in District Court, Seward County, Kansas, the
court granted class certification on Nov. 15, 2001, in an action
brought against the major U.S. cigarette manufacturers,
including RJR Tobacco and B&W, and the parent companies of the
major U.S. cigarette manufacturers, including RJR.
The suit seeks to recover an unspecified amount in actual and
punitive damages. The plaintiffs allege that the defendants
participated in a conspiracy to fix or maintain the price of
cigarettes sold in the U.S. Discovery is underway, according to
Reynolds American Inc.'s form 10-k filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
Dec. 31, 2006.
In "Romero v. Philip Morris Cos., Inc.," a case filed in April
2000 and pending in District Court, Rio Arriba County, New
Mexico, a court granted class certification on May 14, 2003, but
granted the defendant's motion for summary judgment on June 30,
2006, in an action brought against the major U.S. cigarette
manufacturers, including RJR Tobacco and B&W, and the parent
companies of the major U.S. cigarette manufacturers, including
RJR.
The suit seeks to recover an amount not to exceed $74,000 per
class member in actual and punitive damages, exclusive of
interest and costs. The plaintiffs allege that the defendants
conspired to fix, raise, advance and/or stabilize prices for
cigarettes in the State of New Mexico from at least as early as
Jan. 1, 1998, through the present. On Aug. 14, 2006, the
plaintiff filed a notice of appeal to the New Mexico Court of
Appeals.
TOBACCO LITIGATION: "Cleary" Plaintiffs Request Class Status
------------------------------------------------------------
Plaintiffs in "Cleary v. Philip Morris, Inc." filed a new motion
for class certification, according to Reynolds American Inc.'s
form 10-k filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2006.
The suit was filed in June 1998, and is pending in Circuit
Court, Cook County, Illinois. The plaintiffs filed their motion
for class certification on Dec. 21, 2001 in an action brought
against the major U.S. cigarette manufacturers, including R. J.
Reynolds Tobacco Co. (RJR) and Brown & Williamson Holdings, Inc.
(B&W).
The action is brought on behalf of persons who have allegedly
been injured by:
-- the defendants' purported conspiracy pursuant to which
defendants concealed material facts regarding the
addictive nature of nicotine;
-- the defendants' alleged acts of targeting its
advertising and marketing to minors; and
-- the defendants' claimed breach of the public right to
defendants' compliance with the laws prohibiting the
distribution of cigarettes to minors.
The plaintiffs request that the defendants be required to
disgorge all profits unjustly received through its sale of
cigarettes to plaintiffs and classes, which in no event will be
greater than $75,000 each, inclusive of punitive damages,
interest and costs.
On April 8, 2005, the plaintiffs filed a second amended
complaint. On Feb. 3, 2006, a hearing on the defendants' motion
to dismiss occurred. The court dismissed count V (public
nuisance) and count VI (unjust enrichment) on March 27, 2006.
On April 5, 2006, the plaintiffs filed a motion to reconsider
certain of the findings in the court's ruling on defendants'
motion to dismiss counts V and VI of the plaintiffs' second
amended complaint.
The plaintiffs' motion for reconsideration was granted in part
and denied in part. The court stated that reconsideration would
not revive the plaintiffs' public nuisance and unjust enrichment
claims because the plaintiffs still cannot allege a special or
separate harm. The court merely reconsidered certain components
of its analysis, but did not modify its original decision. On
July 11, 2006, the plaintiffs filed a motion for class
certification.
TOBACCO LITIGATION: Ill. Suit Claims Nicotine Content Increase
--------------------------------------------------------------
A class action complaint was filed against certain cigarette
manufacturers and their parents, including R.J. Reynolds Tobacco
Holdings, Inc. and R. J. Reynolds Tobacco Co., in December 2006,
in the Circuit Court for Cook County, Illinois.
In "Espinosa v. Philip Morris USA, Inc.," the plaintiffs brought
the case on behalf of any and all persons similarly situated
throughout Illinois and/or the U.S. who, from 1996 to the date
of judgment, purchased, not for resale, the defendants'
cigarettes.
The plaintiffs allege that the defendants increased the nicotine
in their cigarette products and failed to inform the plaintiff
and/or the class. The plaintiffs seek to recover an amount not
less than the purchase price of defendants' cigarette products,
plus interest, attorneys' fees and costs and such other relief
as the court deems appropriate.
The plaintiffs filed a motion for class certification and a
motion for preservation of documents on Dec. 11, 2006. On Dec.
12, 2006, the defendants removed the case to the U.S. District
Court for the Northern District of Illinois.
TOBACCO LITIGATION: Minn. "Health Impact Fee" Suit Dismissed
------------------------------------------------------------
Plaintiffs in a suit over Minnesota's "health impact fee"
voluntarily dismissed their action after the U.S. Supreme Court
upheld the validity of the fee.
Effective Aug. 1, 2005, Minnesota enacted a "health impact fee"
that imposes a $0.75 per pack fee on cigarettes, which is in
addition to that state's cigarette excise tax of $0.48 per pack.
The stated purpose of the health impact fee is "to recover for
the state health care costs related to or caused by tobacco
use." R.J. Reynolds Tobacco Holdings, Inc. (RJR Tobacco) and
other cigarette manufacturers filed a motion in Minnesota state
court asserting that imposition of the health impact fee
violated the terms of a settlement agreement entered into
between participating manufacturers and Minnesota in 1998.
In November 1998, R. J. Reynolds Tobacco Co. (RJR) and Brown &
Williamson Holdings, Inc. (B&W) and the other major
U.S. cigarette manufacturers entered into the Master Settlement
Agreement with attorneys general representing most U.S. states,
territories and possessions. The MSA imposes a stream of future
payment obligations on RJR Tobacco and the other major
U.S. cigarette manufacturers and places significant restrictions
on their ability to market and sell cigarettes in the future.
After a hearing on the motion against the imposition of the
health impact fee, the court ruled, on Dec. 20, 2005, that the
health impact fee violated the terms of the settlement agreement
and was unconstitutional. The state appealed the court's
ruling, and on May 16, 2006, the Minnesota Supreme Court held
that the health impact fee neither violated the terms of the
settlement agreement nor was unconstitutional. On Feb. 20,
2007, the U.S. Supreme Court denied the defendants' petition for
writ of certiorari.
Minnesota's health impact fee also led to the January 2006
filing of a class-action complaint in the 4th Judicial District,
Hennepin County, Minnesota on behalf of "consumers of cigarettes
and other tobacco products in the State of Minnesota from Aug.
1, 2005 to the present."
The class-action complaint named RJR Tobacco and various other
entities as defendants, and asserted an unjust enrichment claim,
sought the imposition of a constructive trust with respect to
the monies collected pursuant to the health impact fee, and
requested that these monies "be distributed by the best means
practicable to the class members."
The plaintiffs allege that the defendants were primarily
responsible for remitting the health impact fee to the State of
Minnesota, but the ultimate burden of the fees was passed on to
end-purchase tobacco consumers. This case was transferred to
the court presiding over RJR Tobacco's above-referenced motion
seeking to enforce the terms of the parties' 1998 settlement
agreement.
On Aug. 28, 2006, following the ruling by the Minnesota Supreme
Court on RJR Tobacco's challenge to the health impact fee, the
plaintiffs voluntarily dismissed this action.
TOBACCO LITIGATION: "Parsons v. AC&S" Remains Stayed in W.Va.
-------------------------------------------------------------
The case "Parsons v. AC&S, Inc.," which was filed in February
1998, remains stayed in Circuit Court, Ohio County, West
Virginia, according to Reynolds American Inc.'s form 10-k filing
with the U.S. Securities and Exchange Commission for the fiscal
year ended Dec. 31, 2006.
The plaintiff sued asbestos manufacturers, U.S. cigarette
manufacturers, including R. J. Reynolds Tobacco Co. and Brown &
Williamson Holdings, Inc., and parent companies of U.S.
cigarette manufacturers, including R.J. Reynolds Tobacco
Holdings, Inc.
The plaintiff seeks to recover $1,000,000 in compensatory and
punitive damages individually and an unspecified amount for the
class in both compensatory and punitive damages.
The plaintiffs allege that Mrs. Parsons' use of tobacco products
and exposure to asbestos products caused her to develop lung
cancer and to become addicted to tobacco. The case has been
stayed pending a final resolution of the plaintiffs' motion to
refer tobacco litigation to the judicial panel on multi-district
litigation filed in "In Re: Tobacco Litigation" in the Supreme
Court of Appeals of West Virginia.
On Dec. 26, 2000, three defendants:
* Nitral Liquidators, Inc.,
* Desseaux Corp. of North American, and
* Armstrong World Industries
filed bankruptcy petitions in the U.S. Bankruptcy Court for the
District of Delaware, "In re Armstrong World Industries, Inc."
Pursuant to section 362(a) of the Bankruptcy Code, Parsons is
automatically stayed with respect to all defendants.
VIACOM INC: Amended Claims Filed in Suit Over Blockbuster Deal
--------------------------------------------------------------
A shareholder class action was filed in the Court of Chancery of
New Castle County, Delaware against the officers of Viacom, Inc.
over allegations the executives lied about the financial state
of Blockbuster, Inc. when it was spun off in a 2004 stock swap
deal.
On Aug. 3, 2006, Beverly Pfeffer filed a putative class action
complaint under Delaware corporate fiduciary laws against:
-- Sumner M. Redstone,
-- George S. Abrams,
-- David R. Andelman,
-- Joseph A. Califano, Jr.,
-- William S. Cohen,
-- Philippe P. Dauman,
-- Alan C. Greenberg,
-- Jan Leschly,
-- Shari Redstone,
-- Frederic V. Salerno,
-- William Schwartz,
-- Patty Stonesifer, and
-- Robert D. Walter.
On Jan. 12, 2007, plaintiff filed an amended class action
complaint and asserted additional claims under Delaware
corporate fiduciary laws against:
-- National Amusements, Inc.,
-- John F. Antioco,
-- Richard J. Bressler,
-- Jackie M. Clegg,
-- Michael D. Fricklas,
-- Linda Griego, John L. Muething, and
-- CBS Corp. (f.k.a. Viacom, Inc.).
The amended class action complaint purports to be filed on
behalf of all former Viacom stockholders who tendered their
Viacom stock in exchange for common shares of Blockbuster stock
as part of the Blockbuster split-off exchange offer commenced on
Sept.8, 2004 and completed on Oct. 5, 2004, and all Blockbuster
shareholders at the time a special dividend was declared by the
Blockbuster Board of Directors in connection with the
Blockbuster split-off exchange offer in June 2004.
Plaintiff claims that the above-named defendants breached their
fiduciary duties in violation of Delaware corporate fiduciary
laws and, as a result, plaintiff seeks declaratory relief,
compensatory damages, pre-judgment and post-judgment interest,
court costs and expenses, expert witness fees and attorneys'
fees.
Viacom, Inc. on the Net: http://www.viacom.com.
* Large U.S. Settlements Could Encourage Similar Suits in Korea
---------------------------------------------------------------
The rising costs of class-action settlements paid by American
firms have raised concerns that companies in Korea may soon face
similar legal challenges as the government allowed shareholders
to file class actions against all companies this year, the Korea
Herald reports.
American firms, reportedly, had paid a total of $26 billion to
settle collective legal complaints from 1997 to 2005, and each
case cost $35 million on average.
In 2005 alone, Enron Corp. and WorldCom Inc., which collapsed
due to huge accounting frauds, were forced to pay over $13
billion to shareholders.
Class actions were legalized in Korea in 2004 as part of efforts
to improve the nation's shady corporate governance structures
and further protect minority shareholders.
But many Korean experts pointed out that shareholders will find
it hard to exercise their new legal power because the local
legal system largely puts plaintiffs at a disadvantage, the
burden of proof limits room for shareholders to maneuver.
Accounting fraud and insider trading have been widespread in the
local bourse, which has frequently caused losses to investors
and hurt the market's credibility over the past few decades, but
there has been no single class action from shareholders since
2005, when the regulation was first applied to public firms with
more than $2.13 billion in assets.
Kim Hwa-jin, a law professor of Seoul National University, told
The Korea Herald, that shareholders should find evidence and
substantiate their alleged damages in more limited ways in Korea
than in America.
The crucial difference is the "Discovery" system, which allows
shareholders to request copies of documents and materials
relevant to the case from accused firms. Since the Korean courts
have not yet adopted the rule, accusers can only obtain
information and evidence through judges or neutral watchdogs
such as the Financial Supervisory Service.
Critics argue that in many suits shareholders may lack evidence
to prove corporate wrongdoings, due to the obstacle. They point
out that the legal bridle would disturb plaintiffs' efforts to
clarify any fraud committed by corporate management, which are
mostly surreptitious - meaning that a huge amount of proof is
needed.
The plaintiffs, usually shareholders, need to prove that the
defendant, the company or its officials, intentionally made
material misstatements and defrauded people.
Large lawyer fees also discourage minority shareholders from
bringing class actions.
If plaintiffs lose the case, they will be charged full legal
costs, which usually employ a large regiment of expensive
counselors and jurists. This clearly contrasts with the U.S.
system that exempts losers from financial liabilities.
Some observers, however, say the less lenient rules will help
forbid shareholders and corporate raiders abuse class actions.
The collective action has clearly encouraged listed companies to
plug management loopholes and reduce fraud in the U.S. But
mounting corporate costs has caused a backlash.
Asbestos Alert
ASBESTOS LITIGATION: Illinois Tool Works Still Has Injury Suits
---------------------------------------------------------------
Illinois Tool Works Inc., with subsidiaries Hobart Brothers Co.
and Miller Electric Mfg. Co., face lawsuits alleging injury from
exposure to welding consumables.
The plaintiffs in these suits claim damages for injuries from
the plaintiffs' alleged exposure to asbestos, manganese, or
toxic fumes in connection with the welding process, according to
the Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 26, 2007.
The Company has not recorded any significant reserves related to
these cases.
Based in Glenview, Ill., Illinois Tool Works Inc. makes products
used in the automotive, construction, electronics, food and
beverage, paper products, and pharmaceuticals industries. The
Company's engineered products segment offers fasteners, nail
guns, industrial adhesives, and automotive transmission
components. The specialty systems unit's products include paint
application equipment and welding machines.
ASBESTOS LITIGATION: Travelers Property Still Faces ACandS Suits
----------------------------------------------------------------
Travelers Property Casualty Corp., The St. Paul Travelers
Companies Inc.'s subsidiary, continues to face asbestos suits
relating to ACandS Inc., a former distributor and installer of
asbestos-containing products, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 23, 2007.
The proceedings involve disputes as to whether and to what
extent any of ACandS' potential liabilities for current or
future bodily injury asbestos claims are covered by insurance
policies issued by TPC.
In September 2002, ACandS filed for bankruptcy, In re: ACandS,
Inc., pending in the U.S. Bankruptcy Court for the District of
Delaware. In its proposed plan of reorganization, ACandS sought
to establish a trust to pay asbestos bodily injury claims
against it and sought to assign to the trust its rights under
the insurance policies issued by TPC.
The proposed plan and disclosure statement filed by ACandS
claimed that it had settled most asbestos-related bodily injury
claims currently pending against it for about US$2.80 billion.
ACandS asserted that TPC is liable for 45 percent of the US$2.80
billion.
On Jan. 26, 2004, the bankruptcy court rejected confirmation of
ACandS' proposed plan of reorganization. ACandS has appealed the
bankruptcy court's decision and has objected to the bankruptcy
court's findings of fact and conclusions of law in the U.S.
District Court. TPC has moved to dismiss the appeal and
objections and has also filed an opposition to ACandS'
objections.
In January 2001, arbitration was commenced to determine whether
and to what extent ACandS' financial obligations for bodily
injury asbestos claims are subject to insurance policy aggregate
limits. On July 31, 2003, the arbitration panel ruled in favor
of TPC that asbestos bodily injury claims against ACandS are
subject to the aggregate limits of the policies issued to
ACandS, which have been exhausted.
In October 2003, ACandS commenced a suit seeking to vacate the
arbitration award as beyond the panel's scope of authority
(ACandS, Inc. v. Travelers Casualty and Surety Co., U.S.D.Ct.
E.D. Pa.).
On Sept. 16, 2004, the district court denied ACandS' motion to
vacate the arbitration award. On Jan. 19, 2006, the U.S. Court
of Appeals for the 3rd Circuit reversed the district court's
decision and declared the arbitration award void on procedural
grounds.
On May 22, 2006, the U.S. Supreme Court denied TPC's petition
for a writ of certiorari seeking review of the 3rd Circuit's
decision. The matter has been remanded to district court and TPC
has asked the district court to remand the arbitration to the
panel that initially ruled in favor of TPC for further
proceedings consistent with the 3rd Circuit's decision. ACandS
has opposed that request.
In the other proceeding, a related case pending before the same
court and commenced in September 2000 (ACandS v. Travelers
Casualty and Surety Co., U.S.D.Ct., E.D. Pa.), ACandS sought a
declaration of the extent to which the asbestos bodily injury
claims against ACandS are subject to occurrence limits under
insurance policies issued by TPC.
TPC moved to dismiss this action based on the July 31, 2003
arbitration decision. The district court found the dispute was
moot as a result of the arbitration panel's decision and
dismissed the case. As a result of the Jan. 19, 2006 ruling by
the 3rd Circuit and the Supreme Court's denial of certiorari,
this case has been reinstated.
In October 2001 and April 2002, two purported class action suits
(Wise v. Travelers and Meninger v. Travelers) were filed against
TPC and other insurers in state court in West Virginia. These
cases were consolidated into a single proceeding in the Circuit
Court of Kanawha County, W.Va.
Plaintiffs allege that the insurer defendants engaged in unfair
trade practices by inappropriately handling and settling
asbestos claims. The plaintiffs seek to reopen large numbers of
settled asbestos claims and to impose liability for damages,
including punitive damages, directly on insurers.
In November 2001, plaintiffs in consolidated asbestos actions
pending before a mass tort panel of judges in West Virginia
state court moved to amend their complaint to name TPC as a
defendant, alleging that TPC and other insurers breached alleged
duties to certain users of asbestos products. In March 2002, the
court granted the motion to amend.
In August 2002, the bankruptcy court held a hearing on TPC's
motion for a preliminary injunction prohibiting further
prosecution of the suits under the reorganization plan and
related orders.
On March 29, 2006, the U.S. District Court for the Southern
District of New York substantially affirmed the bankruptcy
court's orders while vacating that portion of the bankruptcy
court's orders that required all future direct actions against
TPC to first be approved by the bankruptcy court before
proceeding in state or federal court. Judgment was entered on
March 31, 2006.
Five appeals from the March 29, 2006 ruling were filed in the
U.S. Court of Appeals for the 2nd Circuit and TPC filed a cross-
appeal. Two appellants dismissed their appeals and a motion to
dismiss the cross-appeal was filed. Additionally, TPC appealed
from a procedural order of the district court relating to the
timeliness of the cross-appeal.
On Jan. 17, 2007, the 2nd Circuit dismissed TPC's cross-appeal
and denied TPC's appeal from the procedural order. The three
remaining principal appeals have been consolidated for
disposition and remain pending.
Based in St. Paul, Minn., The St. Paul Travelers Companies Inc.
is a holding company engaged in providing commercial and
personal property and casualty insurance products and services
to businesses, government units, associations and individuals.
ASBESTOS LITIGATION: St. Paul Travelers Incurs $155M Loss in 4Q
---------------------------------------------------------------
The St. Paul Travelers Companies Inc., at and for the year ended
Dec. 31, 2006, incurred US$155 million asbestos-related losses
and loss expenses, compared with US$830 million at and for the
year ended Dec. 31, 2005, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 23, 2007.
About half of the US$155 million 2006 was due to an increase in
the projected defense costs for 10 policyholders. Additionally,
US$15 million of the pretax reserve adjustment was attributable
to a delay in the approval and expected payment of the
previously announced settlement with PPG Industries Inc. as part
of the Pittsburgh Corning Corp. bankruptcy reorganization plan.
Based in St. Paul, Minn., The St. Paul Travelers Companies Inc.
is a holding company engaged in providing commercial and
personal property and casualty insurance products and services
to businesses, government units, associations and individuals.
ASBESTOS LITIGATION: St. Paul Reserves $4.051B for Claims in 4Q
---------------------------------------------------------------
St. Paul Travelers Companies Inc., at and for the year ended
Dec. 31, 2006, recorded a net of US$4.051 billion asbestos-
related reserves, compared with a net of US$4.364 billion at and
for the year ended Dec. 31, 2005.
Net asbestos losses and expenses paid in 2006 were US$469
million, compared with US$399 million in 2005. The US$70 million
net increase was mainly the result of lower reinsurance billings
in 2006. About 50 percent in 2006 and 42 percent in 2005 of
total net paid losses related to policyholders with whom the
Company previously entered into settlement agreements limiting
the Company's liability.
At and for the year ended Dec. 31, 2006, the Company recorded
1,789 policyholders, compared with 1,776 policyholders at and
for the year ended Dec. 31, 2005.
At Dec. 31, 2006, the Company's claims and claim adjustment
expense reserves included US$4.47 billion for asbestos and
environmental-related claims, net of reinsurance, compared with
US$4.79 billion at Dec. 31, 2005.
Based in St. Paul, Minn., The St. Paul Travelers Companies Inc.
is a holding company engaged in providing commercial and
personal property and casualty insurance products and services
to businesses, government units, associations and individuals.
ASBESTOS LITIGATION: Union Pacific Has 2,277 Open Claims in 4Q06
----------------------------------------------------------------
Union Pacific Corp., at Dec. 31, 2006, recorded 2,277 pending
asbestos-related claims filed against it, compared with 2,435
claims pending at Dec. 31, 2005, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on Feb. 23, 2007.
In 2006, the Company recorded 316 claims filed, compared with
741 claims filed in 2005. In 2006, the Company recorded 474
settled or dismissed claims, compared with 622 settled or
dismissed claims in 2005.
The Company faces lawsuits in which current and former employees
allege exposure to asbestos.
At Dec. 31, 2006, the Company's asbestos-related liabilities
were US$302 million, compared with US$311 million at Dec. 31,
2005. At Dec. 31, 2006, the current portion of asbestos-related
liabilities were US$13 million, compared with US$16 million at
Dec. 31, 2005.
About 16 percent of the recorded liability related to asserted
claims and about 84 percent related to unasserted claims. These
claims are to be paid out over the next 28 years.
At Dec. 31, 2006, the Company made US$9 million asbestos-related
payments, compared with US$13 million at Dec. 31, 2005.
Based in Omaha, Nebr., Union Pacific Corp.'s main operating
company, Union Pacific Railroad Co., links 23 states in the
western two-thirds of the country and serves the fastest-growing
U.S. population centers. Union Pacific Railroad Co. connects
with Canada's rail systems and is the only railroad serving all
six major gateways to Mexico, making it North America's premier
rail franchise.
ASBESTOS LITIGATION: NewMarket Reserves $10.23M in 4Q for Claims
----------------------------------------------------------------
NewMarket Corp., at Dec. 31, 2006, recorded US$10,232,000 as
non-current asbestos litigation reserve, compared with
US$8,181,000 at Dec. 31, 2005, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 26, 2007.
The Company faces personal injury lawsuits involving exposure to
asbestos. These cases involve exposure to asbestos in premises
owned or operated, or formerly owned or operated, by Company
subsidiaries.
Nearly all of these cases are pending in Texas, Louisiana, or
Illinois and involve multiple defendants.
During 2005, the Company entered into an agreement with
Travelers Indemnity Co. resolving certain long-standing issues
regarding the Company's coverage for certain premises asbestos
claims. In addition, the agreement with Travelers provides a
procedure for allocating defense and indemnity costs with
respect to certain future premises asbestos claims.
The lawsuit the Company had previously filed against Travelers
in the Southern District of Texas was dismissed. The Company
also settled its outstanding receivable from Albemarle Corp. for
certain premises asbestos liability obligations.
The Company has provided an undiscounted liability related to
premises asbestos claims of US$12 million at yearend 2006 and
US$10 million at yearend 2005.
The receivable for these recoveries related to premises asbestos
liabilities was US$9 million at Dec. 31, 2006 and US$8 million
at Dec. 31, 2005.
Based in Richmond, Va., NewMarket Corp. is a holding company,
which is the parent company of Afton Chemical Corp., Ethyl
Corp., NewMarket Services Corp., and NewMarket Development Corp.
The Company, through Afton and Ethyl, develops, manufactures,
blends, and delivers performance chemical additives that enhance
the performance of petroleum products, and markets and sells
these chemical additives worldwide.
ASBESTOS LITIGATION: Claims v. American Standard Rise to 112,668
----------------------------------------------------------------
American Standard Companies Inc. recorded 112,668 pending
asbestos-related claims as of Dec. 31, 2006, compared with
121,662 pending claims as of Dec. 31, 2005, according to the
Company's annual report, filed with the U.S. Securities and
Exchange Commission on Feb. 26, 2007.
As of Sept. 30, 2006, the Company reported that it faced 111,014
open asbestos-related claims filed against it. (Class Action
Reporter, Oct. 27, 2006)
In 2006, the Company noted 4,378 new claims filed, 711 claims
settled, and 12,661 claims dismissed. In 2005, the Company noted
10,951 claims filed, 946 claims settled, and 11,841 claims
dismissed.
The Company has been named as a defendant in numerous suits
alleging asbestos-related personal injury claims from its
historical sales of boilers and railroad brake shoes.
In these asbestos-related suits, the Company is usually named as
one of a large group of defendants. Many of these suits involve
multiple claimants, do not specifically identify the injury or
disease for which damages are sought, or do not allege a
connection between any Company product and a claimed injury or
disease.
As a result, numerous lawsuits have been placed, and may remain
on, inactive or deferred dockets, which some jurisdictions have
established.
From receipt of its first asbestos claim more than 20 years ago
to Dec. 31, 2006, the Company has resolved 55,061 claims. The
total amount of all settlements paid by the Company, excluding
insurance recoveries, and by its insurance carriers is about
US$84.4 million, for an average payment per resolved claim of
US$1,533.
The average payment per claim resolved in the year ended Dec.
31, 2006 was US$1,492, compared with US$972 in the year ended
Dec. 31, 2005, and US$1,462 in the year ended Dec. 31, 2004.
For the year ended Dec. 31, 2006, the Company's net asbestos
indemnity liability was US$27.2 million, compared with US$5.2
million for the year ended Dec. 31, 2005.
Based in Piscataway, N.J., American Standard Companies Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems.
ASBESTOS LITIGATION: American Standard Liability Totals $665.8M
---------------------------------------------------------------
American Standard Companies Inc.'s asbestos-related liability,
at Dec. 31, 2006, totaled US$665.8 million, compared with US$686
million at Dec. 31, 2005, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 26, 2007.
The asbestos indemnity liability decreased by US$13.4 million in
2005, compared with US$20.2 million in 2006. Both decreases were
due to claims payments made during the year.
Based in Piscataway, N.J., American Standard Companies Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems.
ASBESTOS LITIGATION: ASD Suit Discovery Still Extended to Sept.
---------------------------------------------------------------
Discovery of an asbestos lawsuit, filed by American Standard
Companies Inc. against certain insurance carriers, is still
extended through Sept. 10, 2007, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on Feb. 26, 2007.
The Company is in litigation against certain carriers whose
policies it believes provide coverage for asbestos claims. The
insurance carriers named in this suit are challenging the
Company's right to recovery.
The Company filed the action in April 1999 in the Superior Court
of New Jersey, Middlesex County, against several of its primary
and lower layer excess insurance carriers, seeking coverage for
environmental claims.
The N.J. Litigation was later expanded to also seek coverage for
asbestos related liabilities from twenty-one primary and lower
layer excess carriers and underwriting syndicates.
On Sept. 19, 2005, the Court granted the Company's motion to add
to the N.J. Litigation 16 more insurers and 117 new insurance
policies. The Court also required the parties to submit all
contested matters to mediation.
The Company and the defendants in the N.J. Litigation engaged in
their first mediation session on Jan. 18, 2006 and have engaged
in active discussions since that time.
With the addition of the parties and policies, the N.J.
Litigation would resolve the coverage issues with respect to
about 94 percent of the recorded receivable. The remaining six
percent of the recorded receivable comes from policies as to
which the Company has not sought resolution of coverage because
the policies were issued by parties whose coverage obligation
are triggered at higher excess layers that are not expected to
be reached in the near future.
Based in Piscataway, N.J., American Standard Companies Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems.
ASBESTOS LITIGATION: American Standard Cites $385.8M Receivable
---------------------------------------------------------------
American Standard Companies Inc.'s asbestos receivable, at Dec.
31, 2006, was US$385.8 million, compared with US$390 million at
Dec. 31, 2005, according to the Company's annual report filed
with the U.S. Securities and Exchange Commission on Feb. 26,
2007.
The asbestos receivable of American Standard Companies Inc., at
Sept. 20, 2006, was US$387.8 million. (Class Action Reporter,
Oct. 27, 2006)
In February 2005, the Company settled with Equitas for US$84.5
million to buy out the participants of certain underwriters in
pre-1993 Lloyd's, London policies included in the Company's
insurance coverage. As of Dec. 31, 2006, US$64.9 million
remained in a trust, which expired Jan. 3, 2007.
Under the settlement, if there was no U.S. Federal legislation
by Jan. 3, 2007 that took asbestos claims out of the courts, the
balance of the funds in trust was to be disbursed to the
Company. Since there was no federal legislation that occurred,
the balance of funds in the trust of US$64.9 million was
subsequently disbursed to the Company on Jan. 4, 2007.
Of the US$64.9 million, US$43.2 million relates to historical
asbestos claim settlements and current legal expenses incurred
and US$21.7 million represents amounts relating to future legal
costs to be incurred.
Based in Piscataway, N.J., American Standard Companies Inc.
makes air-conditioning systems, plumbing products, and
automotive braking systems.
ASBESTOS LITIGATION: Safeco Reserves $206.3M in 4Q06 for Claims
---------------------------------------------------------------
Safeco Corp., for the year ended Dec. 31, 2006, reserved
US$206.3 million, before reinsurance, for asbestos claims,
compared with US$186.1 million for the year ended Dec. 31, 2005,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 23, 2007.
For the year ended Dec. 31, 2006, the Company reserved US$171
million, net of reinsurance, for asbestos claims, compared with
US$158.9 million for the year ended Dec. 31, 2005.
The Company recorded 3,047 asbestos-related claims for the year
ended Dec. 31, 2006, compared with 3,061 claims for the year
ended Dec. 31, 2005.
The average amount paid per closed claim, for the year ended
Dec. 31, 2006, was US$30,648, compared with US$25,256 for the
year ended Dec. 31, 2005.
The average case reserve per open claim, for the year ended Dec.
31, 2006, was US$44,997, compared with US$39,230 for the year
ended Dec. 31, 2005.
For the year ended Dec. 31, 2006, the Company paid US$14.4
million, before reinsurance, for loss and allocated loss
adjustment expenses, compared with US$12.3 million for the year
ended Dec. 31, 2005.
For the year ended Dec. 31, 2006, the Company paid US$13.8
million, net of reinsurance, for loss and ALAE, compared with
US$11.5 million for the year ended Dec. 31, 2005.
Based in Seattle, Safeco Corp. offers property-casualty
insurance including auto, homeowners, fire, multiperil, and
workers' compensation.
ASBESTOS LITIGATION: Claims v. Baltimore Gas Remain at 522 in 4Q
----------------------------------------------------------------
Asbestos-related claims against Baltimore Gas and Electric Co.
remain at 522, according to the Company's annual report filed
with the U.S. Securities and Exchange Commission on Feb. 27,
2007.
These 522 claims, filed by individuals who were not employees of
the Baltimore-based Company or of its parent, Constellation
Energy Group Inc., seek several million dollars in compensatory
and punitive damages.
In its quarterly report for the period ended Sept. 30, 2006
filed with the SEC, the Company recorded 522 non-employee
asbestos-related claims. (Class Action Reporter, Dec. 1, 2006)
Since 1993, the Company and certain Constellation Energy
subsidiaries have been involved in several actions concerning
asbestos. The actions are based on the theory of "premises
liability," alleging that the Company and Constellation Energy
knew of and exposed individuals to an asbestos hazard.
Cross-claims and third-party claims brought by other defendants
may also be filed against the Company and Constellation Energy
in these actions.
To date, most asbestos claims against the Company have been
dismissed or resolved without any payment and a minority has
been resolved for immaterial amounts.
The remaining claims are currently pending in Maryland and
Pennsylvania state courts.
Baltimore Gas and Electric Co. provides electricity and natural
gas services to Baltimore and to all or parts of 10 surrounding
Maryland counties. The Company's regulated power transmission
and distribution system consists of more than 20,000 miles of
lines and serves some 1 million customers. The Company is a
Constellation Energy Group Inc. subsidiary.
ASBESTOS LITIGATION: Cleco Still Faces La. Site Exposure Claims
---------------------------------------------------------------
Cleco Corp. continues to face lawsuits filed by individuals who
claim injury due to exposure to asbestos while working at sites
in central Louisiana, according to the Company's annual report
filed with the U.S. Securities and Exchange Commission on Feb.
27, 2007.
Most of the claimants were workers who participated in the
construction of various generation facilities, and some of the
claimants had worked at Company-owned locations.
With two exceptions, all filed, asbestos-related suits have been
settled. The two remaining suits were dismissed by the trial
court and have been appealed by the claimants.
Based in Pineville, La., Cleco Corp.'s utility unit, Cleco
Power, generates, transmits, and distributes electricity to
267,000 residential and business customers in more than 100
communities in Louisiana.
ASBESTOS LITIGATION: Cases v. Corning Inc. Remain at 10.9T at 4Q
----------------------------------------------------------------
Corning Inc. continues to face about 10,900 cases, involving
about 42,300 claims, alleging injuries from asbestos, according
to the Company's annual report filed with the U.S. Securities
and Exchange Commission on Feb. 27, 2007.
The Company faced about 10,900 cases, with about 42,700 claims,
alleging injuries from asbestos, which have been covered by
insurance. (Class Action Reporter, Dec. 22, 2006)
The Company and PPG Industries Inc. each own 50 percent of the
capital stock of Pittsburgh Corning Corp. over a period of more
than two decades, PCC and several other defendants have been
named in suits involving claims alleging personal injury from
exposure to asbestos.
On April 16, 2000, PCC filed for reorganization in the U.S.
Bankruptcy Court for the Western District of Pennsylvania. At
the time PCC filed for bankruptcy protection, there were about
12,400 claims pending against the Company in state court suits
alleging theories of liability based on exposure to PCC's
asbestos products and typically requesting monetary damages in
excess of $1 million per claim.
In the bankruptcy court in April 2000, PCC obtained a
preliminary injunction against the prosecution of asbestos
actions arising from PCC's products against its two shareholders
to afford the parties a period of time in which to negotiate a
plan of reorganization for PCC.
On May 14, 2002, PPG announced that it had agreed with certain
of its insurance carriers and representatives of current and
future asbestos claimants on the terms of a settlement
arrangement applicable to claims arising from PCC's products.
On March 28, 2003, the Company announced that it had reached
agreement with the representatives of asbestos claimants for the
settlement of all current and future asbestos claims against it
and PCC, which might arise from PCC products or operations.
Since March 28, 2003, the Company has recorded total net charges
of US$816 million to reflect the agreed settlement contributions
and subsequent adjustments for the change in the fair value of
the components.
The PCC Plan received a favorable vote from creditors in March
2004. Hearings to consider objections to the Plan were held in
the Bankruptcy Court in May 2004.
In February 2006, the Bankruptcy Court requested that the Plan
proponents delete references to the Bankruptcy Code and resubmit
the Plan. The final round of oral argument was held on July 21,
2006.
On Dec. 21, 2006, the Bankruptcy Court denied confirmation of
the Plan for reasons set out in a memorandum opinion.
Several parties, including Corning, have filed motions of
reconsideration, which were scheduled for a hearing before the
Bankruptcy Court on March 5, 2007.
Based in Corning, N.Y., Corning Inc. is a global, technology-
based corporation that operates in four business segments:
Display Technologies, Telecommunications, Environmental
Technologies and Life Sciences. The Company traces its origins
to a glass business established in 1851. The Company's name was
changed from Corning Glass Works to Corning Inc. on April 28,
1989.
ASBESTOS LITIGATION: Corning Records $656M Settlement Liability
---------------------------------------------------------------
Corning Inc.'s current asbestos settlement liability, for the
year ended Dec. 31, 2006, was US$656 million, compared with
US$667 million for the year ended Dec. 31, 2005, according to
the Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
For the year ended Dec. 31, 2006, the Company's non-current
asbestos settlement liability was US$160 million, compared with
US$152 million for the year ended Dec. 31, 2005.
For the year ended Dec. 31, 2006, the Company recorded asbestos
settlement credit of US$2 million, including US$24 million
reflecting the decrease in the value of the Company's common
stock from Dec. 31, 2005 to Dec. 31, 2006, and US$22 million to
adjust the estimated fair value of the other components of the
proposed asbestos settlement.
Based in Corning, N.Y., Corning Inc. is a global, technology-
based corporation that operates in four business segments:
Display Technologies, Telecommunications, Environmental
Technologies and Life Sciences. The Company traces its origins
to a glass business established in 1851. The Company's name was
changed from Corning Glass Works to Corning Inc. on April 28,
1989.
ASBESTOS LITIGATION: Curtiss-Wright Faces 120 Injury Suits in 4Q
----------------------------------------------------------------
Curtiss-Wright Corp. has been named in about 120 lawsuits that
allege injury from exposure to asbestos, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
The Company has been named in about 100 lawsuits that allege
injury from asbestos exposure. (Class Action Reporter, March 17,
2006)
To date, the Company has secured dismissals with prejudice in
about 19 suits, and it has secured dismissal without prejudice
in about 95 suits.
The Company is currently in discussions for similar dismissal of
several other suits, and have not been found liable nor paid any
material sum of money in settlement in any case.
The Company said it believes that the minimal use of asbestos in
its past and current operations and the relatively non-friable
condition of asbestos in its products makes it unlikely that the
Company will face material liability in any asbestos litigation.
The Company has insurance coverage for these suits and said
adequate coverage exists to cover any unanticipated asbestos
liability.
Based in Roseland, N.J., Curtiss-Wright Corp.'s flow control
business makes special valves for military and commercial
applications, including nuclear submarines, nuclear power
plants, and refineries. Products of the company's motion control
business include actuation systems that control wing flaps, open
bomb-bay doors, and stabilize aiming systems. The Company also
offers metal treatment services.
ASBESTOS LITIGATION: Foster Wheeler Has $424.6M Liability in 4Q
---------------------------------------------------------------
Foster Wheeler Ltd.'s current asbestos-related liability, as of
Dec. 29, 2006, was US$424,628,000, compared with US$446,163,000
as of Dec. 30, 2005, according to the Company's annual report
filed with the U.S. Securities and Exchange Commission on Feb.
27, 2007.
As of Sept. 29, 2006, the Company recorded a total of
US$411,759,000 current asbestos-related liability. (Class Action
Reporter, Nov. 24, 2006)
As of Dec. 29, 2006, the Company's current asbestos-related
insurance recovery receivable was US$350,322,000, compared with
US$321,008,000 as of Dec. 30, 2005.
As of Sept. 29, 2006, the Company's current asbestos-related
insurance recovery receivable was US$341,555,000. (Class Action
Reporter, Nov. 24, 2006)
Based in Clinton, N.J., Foster Wheeler Ltd. operates through two
business groups. The Engineering & Construction group designs
and builds facilities for the oil and gas, chemical,
pharmaceutical, and other industrial markets. The Company's
Power Products & Services unit makes steam-generating units and
related equipment for power and industrial plants, including
fluidized-bed and conventional boilers.
ASBESTOS LITIGATION: Foster Wheeler Has 330 U.K. Claims at 4Q06
---------------------------------------------------------------
Foster Wheeler Ltd. said that 824 asbestos-related claims have
been brought against its U.K. subsidiaries, of which 330
remained open as of Dec. 29, 2006, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on Feb. 27, 2007.
As of Dec. 29, 2006, the Company had recorded total liabilities
of US$35,800,000 comprised of an estimated liability relating to
open (outstanding) claims of US$6,600,000 and an estimated
liability relating to future unasserted claims through yearend
2021 of US$29,200,000.
Of the total, US$2,200,000 was recorded in accrued expenses and
US$33,600,000 was recorded in asbestos-related liability on the
consolidated balance sheet.
An asset in an equal amount was recorded for the expected U.K.
asbestos-related insurance recoveries, of which US$2,200,000 was
recorded in accounts and notes receivable-other and
US$33,600,000 was recorded as asbestos-related insurance
recovery receivable on the consolidated balance sheet.
The liability and asset estimates are based on a U.K. court of
appeal ruling that pleural plaque claims do not amount to a
compensable injury and accordingly, the Company has reduced its
liability assessment.
Should this ruling be reversed, the asbestos liability and asset
recorded in the U.K. would be about US$57,600,000.
Based in Clinton, N.J., Foster Wheeler Ltd. operates through two
business groups. The Engineering & Construction group designs
and builds facilities for the oil and gas, chemical,
pharmaceutical, and other industrial markets. The Company's
Power Products & Services unit makes steam-generating units and
related equipment for power and industrial plants, including
fluidized-bed and conventional boilers.
ASBESTOS LITIGATION: Foster Wheeler Ltd. Has 135T Claims at 4Q
--------------------------------------------------------------
Foster Wheeler Ltd., for the year ended Dec. 29, 2006, recorded
135,890 asbestos-related claims filed against its U.S.
subsidiaries, compared with 164,820 claims for the year ended
Dec. 30, 2005, according to the Company's annual report filed
with the U.S. Securities and Exchange Commission on Feb. 27,
2007.
The Company's U.S. subsidiaries, for the three months ended
Sept. 29, 2006, recorded 150,800 open asbestos-related claims,
compared with 165,910 open claims for the three months ended
Sept. 30, 2005. (Class Action Reporter, Nov. 24, 2006)
In 2006, the Company noted 8,250 new claims filed in the U.S.,
compared with 14,340 in 2005.
In 2006, the Company noted 37,180 U.S. claims resolved, compared
with 17,280 claims in 2005.
Of the 135,890 claims, the Company's units are respondents in
about 33,095 open administrative claims and are named defendants
in suits involving about 102,795 plaintiffs.
As of Dec. 29, 2006, the U.S. subsidiaries' asbestos-related
assets totaled US$363,700,000, compared with US$320,000,000 as
of Dec. 31, 2005.
As of Dec. 29, 2006, the U.S. subsidiaries' asbestos-related
liabilities totaled US$466,000,000, compared with US$516,000,000
as of Dec. 30, 2005.
The amount spent on asbestos litigation, defense, and case
resolution was US$83,300,000 in fiscal 2006, compared with
US$83,800,000 in fiscal 2005.
Through Dec. 29, 2006, total cumulative indemnity costs paid
were about US$574,600,000 and total cumulative defense costs
paid were about US$212,400,000. The overall average combined
indemnity and defense cost per resolved claim has been about
US$2,400.
As of Dec. 29, 2006, total asbestos-related liabilities were
comprised of an estimated liability of US$203,500,000 relating
to open (outstanding) claims being valued and an estimated
liability of US$262,500,000 relating to future unasserted claims
through yearend 2021.
Over the last several years, certain of the Company's units have
entered into settlement agreements calling for insurers to make
lump-sum payments, as well as payments over time, for use by the
units to fund asbestos-related indemnity and defense costs and,
in certain cases, for reimbursement for portions of out-of-
pocket costs previously incurred.
In the 2006-2nd quarter, the subsidiaries reached an agreement
to settle their disputed asbestos and silica-related insurance
coverage with one of the Company's insurers.
In the 2006-3rd quarter, the Company also settled with three
more insurers. As a result of these settlements, the Company
recorded a gain of US$96,200,000 in fiscal year 2006.
In fiscal year 2006, the Company was successful in its appeal of
a New York state trial court decision that previously had held
that New York, rather than New Jersey, law applies in the
coverage litigation with its subsidiaries' insurers. As a
result, the Company increased its insurance asset and recorded a
gain of US$19,500,000 in fiscal year 2006.
On Feb. 13, 2007, the subsidiaries' insurers were granted
permission by the appellate court to appeal the decision in the
Company's favor to the New York Court of Appeal.
Based in Clinton, N.J., Foster Wheeler Ltd. operates through two
business groups. The Engineering & Construction group designs
and builds facilities for the oil and gas, chemical,
pharmaceutical, and other industrial markets. The Company's
Power Products & Services unit makes steam-generating units and
related equipment for power and industrial plants, including
fluidized-bed and conventional boilers.
ASBESTOS LITIGATION: Pending Suits v. AK Steel Rise to 421 in 4Q
----------------------------------------------------------------
AK Steel Holding Corp., as of Dec. 31, 2006, recorded 421
asbestos-related lawsuits pending against it, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
As of Dec. 31, 2005, the Company recorded 401 asbestos-related
exposure lawsuits pending against it. (Class Action Reporter,
Aug. 11, 2006)
In 2006, the Company noted 60 new claims filed and 65 claims
disposed of. The Company recorded US$400,000 as the total amount
paid in settlements.
In 2005, the Company noted 186 new claims filed and 112 claims
disposed of. The Company recorded US$1.3 million as the total
amount paid in settlements.
Since 1990, the Company, or its predecessor, Armco Inc., has
been named as a defendant in suits alleging personal injury as a
result of exposure to asbestos.
Most of these suits have been filed on behalf of people who
claim to have been exposed to asbestos while visiting the
premises of a current or former Company facility. About half of
these premises suits arise out of claims of exposure at a
facility in Houston that has been closed since 1984.
Only 148 of the 421 cases pending at Dec. 31, 2006 in which the
Company is a defendant include specific dollar claims for
damages in the filed complaints. Those 148 cases involve a total
of almost 2,620 plaintiffs and 17,885 defendants.
In each, the complaint typically includes a monetary claim for
compensatory damages and a separate monetary claim in an equal
amount for punitive damages, and does not attempt to allocate
the total monetary claim among the various defendants.
For example, 121 of the 148 cases involve claims of US$200,000
or less, eight involve claims of between US$200,000 and US$5
million, 16 involve claims of between US$5 million and US$15
million, and three involve claims of US$20 million.
Since the onset of asbestos claims against the Company in 1990,
five asbestos claims against it have proceeded to trial in four
separate cases. All five concluded with a verdict in favor of
the Company.
Based in Middletown, Ohio, AK Steel Holding Corp. is a fully
integrated producer of flat-rolled carbon, stainless and
electrical steels and tubular products through its wholly-owned
subsidiary, AK Steel Corp.
ASBESTOS LITIGATION: Exposure Claims v. Grainger Rise to 3,100
--------------------------------------------------------------
W.W. Grainger Inc., as of Jan. 17, 2007, faces cases filed on
behalf of about 3,100 plaintiffs, in which there are allegations
of exposure to asbestos and silica, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on Feb. 27, 2007.
As of Jan. 23, 2006, the Company faced cases filed on behalf of
about 1,300 plaintiffs, in which there is an allegation of
asbestos exposure. (Class Action Reporter, March 10, 2006)
The Company has been named, along with other nonaffiliated
companies, as a defendant in litigation in various states
involving asbestos or silica.
These lawsuits typically assert claims of personal injury
arising from alleged exposure to asbestos or silica as a
consequence of products purportedly distributed by the Company.
In 2006, lawsuits relating to asbestos or silica and involving
about 300 plaintiffs were dismissed with respect to the Company,
typically based on the lack of product identification.
If a specific product distributed by the Company is identified
in any of these suits, it would attempt to exercise
indemnification remedies against the product manufacturer.
Moreover, the Company said it believes that a substantial number
of these claims are covered by insurance. The Company is engaged
in active discussions with its insurance carriers regarding the
scope and amount of coverage.
Based in Lake Forest, Ill., W.W. Grainger Inc. distributes
maintenance, repair, and service equipment, components, and
supplies. The Company provides products like compressors,
motors, signs, lighting and welding equipment, and hand and
power tools. The Company has nearly 600 branches and 15
distribution centers in the U.S., Canada, Mexico, and China.
ASBESTOS LITIGATION: Harsco Records 26,440 Pending Claims in 4Q
---------------------------------------------------------------
Harsco Corp., as of Dec. 31, 2006, recorded 26,440 pending
asbestos-related personal injury claims filed against it,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 27, 2007.
As of Sept. 30, 2006, the Company recorded 26,465 pending
asbestos-related personal injury claims filed against it,
compared with 26,712 claims as of June 30, 2006. (Class Action
Reporter, Nov. 17, 2006)
The Company has been named as one of many defendants, about 90
or more in most cases, in lawsuits alleging personal injury from
exposure to airborne asbestos over the past several decades. In
their suits, the plaintiffs have named as defendants
manufacturers, distributors and installers of numerous types of
equipment or products that allegedly had asbestos.
The Company has never been a producer, manufacturer, or
processor of asbestos fibers. Any component within a Company
product, which may have contained asbestos, would have been
bought from a supplier.
Most of the asbestos complaints pending against the Company have
been filed in New York. Almost all of the New York complaints
contain a standard claim for damages of US$20 million or US$25
million against about 90 defendants, regardless of the
individual plaintiff's alleged medical condition, and without
specifically identifying any Company product as the source of
plaintiff's asbestos exposure.
Of the 26,440 cases, 26,111 were pending in the New York Supreme
Court for New York County in New York State. The other claims,
totaling 329, are filed in various counties in a number of state
courts, and in certain Federal District Courts, including New
York. Those complaints generally assert lesser amounts of
damages than the New York State court cases or do not state any
amount claimed.
As of Dec. 31, 2006, the Company has obtained dismissal by
stipulation, or summary judgment before trial, in 16,953 cases.
Most of the asbestos cases filed against the Company in New York
County have been moved to the Inactive Docket until such time as
the plaintiff can show that they have incurred a physical
impairment.
As of Dec. 31, 2006, the Company has been listed as a defendant
in 248 Active or In Extremis asbestos cases in New York County.
Plaintiffs have challenged the Court's Order.
The Company's insurance carrier has paid all legal and
settlement costs and expenses to date. The Company has liability
insurance coverage under various primary and excess policies
that the Company believes will be available, if necessary, to
substantially cover any liability that might ultimately be
incurred on these claims.
ASBESTOS LITIGATION: Longview Fibre Continues to Face Mo. Action
----------------------------------------------------------------
Longview Fibre Co. continues to face an asbestos-related injury
lawsuit pending in St. Louis, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 27, 2007.
Since 2002, the Company has been named a defendant in asbestos-
related actions in Madison County, Ill. and St. Louis, along
with numerous other defendants.
In December 2005, the Madison County and St. Louis plaintiffs
agreed to dismiss the Company from all but one of the suits in
those jurisdictions.
In each instance, the Company was dismissed without any payment
or liability to the plaintiffs. However, each of the dismissals
was without prejudice, meaning that the plaintiffs could re-
institute those cases.
In the remaining St. Louis suit, the plaintiff alleges asbestos-
related injuries from exposure to the defendants' asbestos
products, as well as exposure to asbestos while working on
certain of the defendants' premises.
The claims are not specific as to what contacts the plaintiff
had with the Company or its manufacturing plants or products.
The suit does not specify damages sought from the Company
individually, but the plaintiff alleges a general jurisdictional
amount against all defendants.
Based in Longview, Wash., Longview Fibre Co., since starting
operations in 1927, has become an integrated wood products
company. The Company owns and manages about 588,000 acres of
valuable timberlands in the Pacific Northwest composed mainly of
softwoods.
ASBESTOS LITIGATION: Longview Fibre Counters Travelers' Actions
---------------------------------------------------------------
Longview Fibre Co. continues its involvement in asbestos-related
insurance lawsuits, which are pending in Connecticut and
Washington state, regarding Travelers Insurance, according to
the Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
In November 2005, the Company was served as a defendant in a
case filed by several Travelers entities in federal court in the
District of Connecticut, entitled The Travelers Indemnity Co.,
et al. v. Longview Fibre Co., 06cv1689.
Plaintiffs allege that under the retrospective premium
provisions of the insurance policies issued by Travelers, the
Company is responsible for paying Travelers for the sums that
Travelers had previously reimbursed the Company related to its
costs in defending against asbestos bodily injury suits.
Travelers alleges in its complaint that the Company has been
billed and has not paid about US$1,600,000 in retrospective
premiums.
Before being served with the Connecticut suit, the Company sued
Travelers in the Western District of Washington, entitled
Longview Fibre Paper and Packaging Inc. v. Travelers Indemnity
Co., et al., No. CV06-5666.
The suit alleges that:
-- Travelers has breached its obligations under the insurance
policies it issued to the Company,
-- That Travelers has failed to reimburse more than US$400,000
in defense costs previously paid by the Company, and
-- That the Company does not owe Travelers any amount under the
insurance policies.
The Company has filed a motion to dismiss the Connecticut Action
or in the alternative to transfer venue to the Washington Court.
The Company anticipates that these two cases will be
consolidated into one, and the litigation will proceed in either
Washington or Connecticut.
Based in Longview, Wash., Longview Fibre Co., since starting
operations in 1927, has become an integrated wood products
company. The Company owns and manages about 588,000 acres of
valuable timberlands in the Pacific Northwest composed mainly of
softwoods.
ASBESTOS LITIGATION: Longview Fiber Faces Stalik Action in Tex.
---------------------------------------------------------------
Longview Fiber Co., since November 2006, faces an asbestos-
related case filed in Wharton County, Texas District Court,
styled "Stalik v. A.W. Chesterton Co., et al.," according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
In the complaint, the plaintiff alleges that he suffers from an
asbestos-related lung disease as a result of his exposure to
asbestos during his work for a contractor at the Longview mill
in the 1960s and at other undisclosed dates.
The plaintiff also alleges exposure to asbestos at facilities
owned by others during his work in various shipyards, steel
mills, refineries, paper mills, chemical plants, or other
facilities in the U.S.
The Company anticipates that it may file one or more motions to
dismiss this litigation in 2007.
Based in Longview, Wash., Longview Fibre Co., since starting
operations in 1927, has become an integrated wood products
company. The Company owns and manages about 588,000 acres of
valuable timberlands in the Pacific Northwest composed mainly of
softwoods.
ASBESTOS LITIGATION: Macerich Incurs $500T for Remediation in 4Q
----------------------------------------------------------------
Macerich Co., for the years ended Dec. 31, 2006 and Dec. 31,
2005, incurred US$500,000 in asbestos remediation costs of its
Fresno Fashion Fair, according to the Company's annual report
filed with the U.S. Securities and Exchange Commission on Feb.
27, 2007.
An additional US$400,000 remains reserved at Dec. 31, 2006.
The Company acquired Fresno Fashion in December 1996. Asbestos
was detected in structural fireproofing throughout much of the
Center.
Testing data conducted by professional environmental consulting
firms indicates that the fireproofing is largely inaccessible to
building occupants and is well adhered to the structural
members.
Additionally, airborne concentrations of asbestos were well
within the Occupational Safety and Health Administration's
permissible exposure limit of .1 fcc.
The accounting at acquisition included a reserve of US$3.3
million to cover future removal of this asbestos, as necessary.
The Center was recently renovated and a substantial amount of
the asbestos was removed.
Based in Santa Monica, Calif., The Macerich Co. is a fully
integrated, self-administered real estate investment trust that
acquires, redevelops, and manages shopping malls and strip
centers. Built through acquisitions and redevelopment, the
Company's portfolio consists of 75 regional shopping centers, 20
community shopping centers, and two development properties
totalling about 80 million sq. ft.
ASBESTOS LITIGATION: Ohio Casualty Reserves $94.4M for A&E in 4Q
----------------------------------------------------------------
Ohio Casualty Corp., at yearend 2006, reserved US$94.4 million,
net of reinsurance, for asbestos and environmental exposures,
compared with US$95.8 million at yearend 2006, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 27, 2007.
The Company has limited A&E exposures related to assumed
reinsurance business written before 1980 with small policy
limits.
In 2006, the Company paid loss and loss adjustment expenses of
US$6.1 million for A&E claims on a net of reinsurance basis,
compared with US$7.3 million in 2005, and US$7 million in 2004.
The Company's 36-month (2004 - 2006) survival ratios, on a net
of reinsurance basis, are 14.5 years for asbestos and 13.4 years
for environmental liability.
Based in Fairfield, Ohio, Ohio Casualty Corp. is the holding
company of The Ohio Casualty Insurance Co., whose main products
consist of insurance for personal auto, homeowners, commercial
property, commercial auto, workers' compensation and other
miscellaneous lines. The Group operates through the independent
agency system in over 40 states, with 29.3 percent of its 2006
net premiums written generated in the states of New Jersey (11
percent), Pennsylvania (9.8 percent), and Kentucky (8.5
percent).
ASBESTOS LITIGATION: Phelps Dodge Still Faces Liability Lawsuits
----------------------------------------------------------------
Phelps Dodge Corp., or its subsidiaries, continue to face
asbestos-related product liability or premises lawsuits,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 27, 2007.
Since about 1990, the Company or its subsidiaries have been
named as a defendant in the suits filed by electricians and
other skilled tradesmen or contractors claiming injury from
exposure to asbestos found in limited lines of electrical wire
products produced or marketed many years ago, or from asbestos
at certain Company properties.
Based in Phoenix, Ariz., Phelps Dodge Corp. produces copper and
molybdenum. The Company also produces molybdenum-based chemicals
and continuous-cast copper rod.
ASBESTOS LITIGATION: Suit v. RJR Tobacco Ongoing in Calif. Court
----------------------------------------------------------------
Reynolds American Inc.'s subsidiary, R.J. Reynolds Tobacco Co.,
faces a smoking-related asbestos lawsuit filed by Leonard
Whiteley for his deceased wife, Leslie, in California court,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 27, 2007.
On March 20, 2000, in Whiteley v. Raybestos-Manhattan Inc. (a
case filed in April 1999, and pending in Superior Court, San
Francisco County, Calif.), a jury awarded the Whiteleys US$1.72
million in compensatory damages and US$20 million in punitive
damages.
RJR Tobacco and Philip Morris Inc. were each assigned US$10
million of the punitive damages award. The defendants appealed
the final judgment to the California Court of Appeals.
On April 7, 2004, the court of appeals reversed the judgment and
remanded the case for a new trial. On April 28, 2006, Mr.
Whiteley filed a consolidated amended complaint for
survival/loss of consortium/wrongful death.
The plaintiffs allege that use of the defendants' products,
along with exposure to asbestos, caused Mrs. Whiteley to develop
lung cancer and ultimately die.
With the filing of the consolidated complaint, the case name
became Whiteley v. R.J. Reynolds Tobacco Co.
Jury selection began on Jan. 22, 2007. Opening statements
occurred on Feb. 26, 2007.
Based in Winston-Salem, N.C., Reynolds American Inc. was created
to combine the U.S. assets, liabilities and operations of Brown
& Williamson Holdings Inc., an indirect, wholly owned subsidiary
of British American Tobacco p.l.c., with R. J. Reynolds Tobacco
Co., a wholly owned operating subsidiary of R.J. Reynolds
Tobacco Holdings Inc. (RJR). RJR is now a Company subsidiary.
ASBESTOS LITIGATION: RJR Tobacco, B&W Still Face Parsons Action
---------------------------------------------------------------
Reynolds American Inc.'s subsidiaries, R.J. Reynolds Tobacco Co.
and Brown & Williamson Holdings Inc., continue to face an
asbestos-related class action lawsuit, styled Parsons v. AC&S
Inc., according to the Company's annual report filed with the
U.S. Securities and Exchange Commission on Feb. 27, 2007.
Parsons, filed in February 1998, is pending in Circuit Court,
Ohio County, W.Va. In the suit, the plaintiff sued asbestos
manufacturers, U.S. cigarette manufacturers, including RJR
Tobacco and B&W, and parent companies of U.S. cigarette
manufacturers, including RJR, seeking to recover US$1 million in
compensatory and punitive damages individually and an
unspecified amount for the class in both compensatory and
punitive damages.
The plaintiffs allege that Mrs. Parsons' use of tobacco products
and exposure to asbestos products caused her to develop lung
cancer and to become addicted to tobacco.
The case has been stayed pending a final resolution of the
plaintiffs' motion to refer tobacco litigation to the judicial
panel on multi-district litigation filed in In Re: Tobacco
Litigation in the Supreme Court of Appeals of West Virginia.
On Dec. 26, 2000, three defendants (Nitral Liquidators Inc.,
Desseaux Corp. of North American and Armstrong World Industries)
filed bankruptcy petitions in the U.S. Bankruptcy Court for the
District of Delaware, In re Armstrong World Industries Inc.
under the U.S. Bankruptcy Code, Parsons is automatically stayed
with respect to all defendants.
As of Feb. 2, 2007, no suits were pending against RJR Tobacco
and B&W in which asbestos companies and asbestos-related trust
funds allege that they "overpaid" claims brought against them to
the extent that tobacco use, not asbestos exposure, was the
cause of the alleged personal injuries.
The last of those cases, Fibreboard Corp. v. R.J. Reynolds
Tobacco Co., filed in November 1997, pending in Superior Court,
Alameda County, Calif., was dismissed with prejudice on July 28,
2006.
Based in Winston-Salem, N.C., Reynolds American Inc. was created
to combine the U.S. assets, liabilities and operations of Brown
& Williamson Holdings Inc., an indirect, wholly owned subsidiary
of British American Tobacco p.l.c., with R. J. Reynolds Tobacco
Co., a wholly owned operating subsidiary of R.J. Reynolds
Tobacco Holdings Inc. (RJR). RJR is now a Company subsidiary.
ASBESTOS LITIGATION: Law Firm Announces $2M Verdict v. GM, Ford
---------------------------------------------------------------
A Dallas-based law firm, Baron & Budd P.C., is announcing a
unanimous US$2 million jury verdict against General Motors Corp.
and Ford Motor Co. on behalf of a former Pawtuckett, R.I.,
resident who contracted a deadly cancer as a result of his
workplace exposure to asbestos, PR Newswire reports.
Rick Nemeroff of Dallas' Nemeroff Law Firm and Baron & Budd
attorney Scott R. Frieling represented retired mechanic Roland
Leo Grenier, Sr., in the trial heard in New Castle County
Superior Court.
"Mr. Grenier had no idea that the products he used while
providing for his wife and children would later threaten his
life," Mr. Nemeroff said. "It's gratifying to see that the jury
agreed that these companies should be held responsible for the
pain and suffering caused by their products."
Members of the jury heard how Mr. Grenier was exposed to
asbestos for nearly 35 years while working as an auto mechanic
and laborer in the Pawtuckett area. During the course of his
work, Mr. Grenier used several products made by General Motors
and Ford that had asbestos, including vehicle brake and clutch
mechanisms.
In 2005, Mr. Greiner was diagnosed with mesothelioma. Testimony
in the case showed that officials from General Motors and Ford
knew about the dangers of asbestos exposure, but did nothing to
protect Mr. Greiner.
The effects of asbestos exposure, including the onset of
diseases like mesothelioma, can take years or decades to
surface. More than 25 years passed before Mr. Grenier began
showing symptoms of the deadly disease.
The jury of four men and eight women returned the verdict on
March 2, 2007 in Judge Mary Johnston's courtroom in Wilmington,
Del. The three-week trial concluded after 10 hours of jury
deliberations conducted over two days.
In the US$2 million compensatory damages verdict, members of the
jury assessed 70 percent liability against General Motors, 16
percent against Ford, and 2 percent against seven other
defendant companies.
ASBESTOS LITIGATION: Kans. Worker's Estate Sues 94 Firms in Ill.
----------------------------------------------------------------
The estate of laborer Robert Briggs sued 94 defendant companies
in an asbestos-related lawsuit filed in Madison County Circuit
Court, Ill., on Feb. 28, 2007, claiming his disease was
wrongfully caused, The Madison St. Clair Record reports.
According to the complaint, Mr. Briggs was employed as a laborer
at Owens Corning and at Jay Wolfe Pontiac in Kansas City, Kans.
He died from mesothelioma on March 21, 2005.
Mr. Briggs' estate alleges that the defendants failed to
exercise ordinary care and caution for his safety by including
asbestos in their products, even though it was completely
foreseeable and should have been anticipated that people working
with or around them would inhale, ingest, or otherwise absorb
great amounts of asbestos.
The estate claims the defendants intentionally or with a
reckless disregard for Mr. Briggs' safety:
-- Included asbestos in their products, when the defendants knew
or should have known that the asbestos fibers would have a
toxic, poisonous and highly deleterious effect upon his health;
-- Included asbestos in their products when adequate
substitutions were available;
-- Failed to provide adequate warning to people working with and
around the products of the dangers of inhaling, ingesting or
otherwise absorbed fibers in them;
-- Failed to provide adequate instruction concerning the safe
methods of working with and around asbestos products; and
-- Failed to conduct tests on the asbestos-containing products,
manufactured, sold or delivered by the defendants in order to
determine the hazards to which workers might be exposed.
Mr. Briggs' estate claims he had become disabled and disfigured,
became liable for medical expenses, experienced great physical
pain and mental anguish, and had been prevented from pursuing
his normal course of employment, losing large sums of money.
Sarah Randle, the administrator of the estate, is also seeking
damages claiming her brother's illness has deprived her of the
companionship, society and services of her brother.
Represented by Randy Gori of Edwardsville, Ill., the estate is
seeking damages in excess of US$200,000 plus punitive damages in
excess of US$100,000.
The case has been assigned to Circuit Judge Daniel J. Stack.
ASBESTOS LITIGATION: Philips Sued in Dutch Court on U.S. Claims
---------------------------------------------------------------
Royal Philips Electronics N.V. was taken to a Dutch court on
March 5, 2007 by a group of insurers over some U.S. asbestos
damage claims the Company faces, Reuters reports.
A spokeswoman for the Dutch unit of French insurer AXA, one of
the lead plaintiffs in the case, said it had asked in summary
proceedings to get more clarity over the nature and origin of
the damage claims the Company is facing.
Under the Company's general liability insurance the insurers may
have to cover these damages.
The Company took a pre-tax charge of EUR334 million in 2006 to
cover potential asbestos-related claims.
Judicial proceedings have been brought in the U.S., relating
primarily to the activities of one company, which Philips
acquired in 1981 and which relates to asbestos used in the
manufacture of unrelated companies' products in the U.S. before
the takeover.
Based in Amsterdam, The Netherlands, Royal Philips Electronics
N.V. makes consumer electronics, including TVs, VCRs, DVD
players, phones, and fax machines. The Company also makes light
bulbs, electric shavers and other personal care appliances,
picture tubes, medical systems, and silicon systems solutions.
ASBESTOS LITIGATION: James Hardie Links 3Q07 Losses to Asbestos
---------------------------------------------------------------
James Hardie Industries N.V. has reported a net loss for the
fiscal 2007-3rd quarter, on the back of asbestos provisioning, a
softening housing market, and a rising Australian dollar, Herald
Sun reports.
On March 6, 2007, the Company posted a net operating loss of
US$8 million (AUD10.4 million) for the December quarter,
compared with a profit of US$40.7 million for the same period in
fiscal 2006.
The loss reflected a charge of US$44.8 million relating to
provisioning for asbestos-related claims. However, the Company
said currency fluctuations had also impacted its earnings, most
of which are generated in the U.S. market.
James Hardie chief finance officer Russell Chenu pointed to a
stronger Australian dollar, which appreciated against the US
dollar almost five percent over the quarter.
The Company's underlying result, which excludes asbestos
provisioning, was a net operating profit of US$36.8 million, a
fall of 10 percent.
Over the nine months to the end of Dec. 31, 2007, underlying
profit was US$167.8 million, a rise of 16 percent.
However, the Company said it still expected full-year net
operating profit, excluding asbestos-related expenses, to fall
within the range of analyst forecasts.
The Company's chief executive Louis Gries said its U.S.
business, which makes up the lion's share of its operations, had
outperformed the market in a weak environment.
Based in Amsterdam, The Netherlands, James Hardie Industries
N.V. uses cellulose-reinforced fiber cement to create products
for residential and commercial construction, including
Hardiplank siding, external cladding, walls, fencing, and
roofing.
ASBESTOS LITIGATION: Rogers Corp. Faces 148 Pending Claims in 4Q
----------------------------------------------------------------
Rogers Corp., as of Dec. 31, 2006, recorded about 148 pending
asbestos-related claims filed against it, compared with 215
pending claims at Jan. 1, 2006, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on Feb. 27, 2007.
These claims are pending primarily in Pennsylvania, Illinois,
and Mississippi.
As of Oct. 1, 2006, the Company recorded about 157 pending
asbestos-related claims filed against it. (Class Action
Reporter, Dec. 15, 2006)
The Company did not mine, mill, manufacture or market asbestos.
Rather, the Company made some limited products, which contained
encapsulated asbestos. Those products were provided to
industrial users. The Company stopped making these products in
1987.
Cases involving the Company typically name 50 to 300 defendants,
although some cases have had as few as one and as many as 833
defendants. The Company has obtained dismissals of many of these
claims.
In 2006, the Company was able to have about 76 claims dismissed
and settled 15 claims. In 2005, the Company was able to have
about 159 claims dismissed and settled 12 claims.
The Company's insurance carriers have paid most of the costs,
including the costs associated with the small number of cases
that have been settled. Those settlements totaled about US$5.1
million in 2006, and about US$4.4 million in 2005.
Based in Rogers, Conn., Rogers Corp., founded in 1832, supplies
specialty materials and components for portable communications,
communications infrastructure, computer and office equipment,
aerospace and defense, ground transportation and consumer
products.
ASBESTOS LITIGATION: Cases v. U.S. Steel Increase to 300 in 4Q06
----------------------------------------------------------------
United States Steel Corp., as of Dec. 31, 2006, faces about 300
active asbestos-related cases involving about 3,700 plaintiffs,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 27, 2007.
At Dec. 31, 2005, the Company faced about 500 active cases
involving about 8,400 plaintiffs.
As of Sept. 30, 2006, the Company was a defendant in about 250
active asbestos-related cases with about 3,800 plaintiffs, up
from 230 cases with about 4,050 plaintiffs as of June 30, 2006.
(Class Action Reporter, Nov. 10, 2006)
In 2006, settlements and dismissals resulted in the disposition
of about 5,150 claims and the Company paid about US$8 million in
settlements. New filings added about 450 claims.
More than 3,400, or about 92 percent, of these claims are
currently pending in jurisdictions which permit filings with
massive numbers of plaintiffs. Of these claims, about 2,000 are
pending in Mississippi and over 1,200 are pending in Texas.
The states of Mississippi and Texas have amended their laws to
curtail mass filings. As a consequence, about 450 claims filed
in 2006 name either a single individual or a handful of
individuals.
Historically, these claims against the Company fall into three
major groups:
(1) Claims made under certain federal and general maritime laws
by employees of the Great Lakes Fleet or Intercoastal Fleet,
former Company operations;
(2) Claims made by persons who allegedly were exposed to
asbestos at Company facilities; and
(3) Claims made by industrial workers allegedly exposed to
products formerly made by the Company.
Historically, about 89 percent of the cases against the Company
did not specify any damage amount or stated that the damages
sought exceeded the amount required to establish jurisdiction of
the court in which the case was filed. Jurisdictional amounts
generally range from US$25,000 to US$75,000.
Based in Pittsburgh, United States Steel Corp. is an integrated
steel producer with production operations in the U.S. and
Central Europe. The Company has annual raw steel production
capability of 19.4 million net tons in the U.S. and 7.4 million
net tons in Central Europe. The Company is also engaged in
several other business activities, most of which are related to
steel manufacturing.
ASBESTOS LITIGATION: Advance Auto Parts Still Faces Injury Suits
----------------------------------------------------------------
Advanced Auto Parts Inc.'s subsidiary, Western Auto, continues
to face lawsuits alleging injury from exposure to asbestos-
containing products, according to the Company's annual report
filed with the U.S. Securities and Exchange Commission on Feb.
28, 2007.
The Company and some of its subsidiaries also have been named as
defendants in many of these suits.
The plaintiffs have alleged that these products were made,
distributed, or sold by the various defendants. To date, these
products have included brake and clutch parts and roofing
materials.
Many of the cases pending against the Company or its
subsidiaries are in the early stages of litigation.
Some of the automotive parts manufacturers named as defendants
in these lawsuits have declared bankruptcy, which will limit
plaintiffs' ability to recover monetary damages from those
defendants.
While the Company defends against these claims, it may enter
into discussions regarding settlement of these and other suits,
and may enter into settlement agreements.
Based in Roanoke, Va., Advance Auto Parts Inc. operates within
the U.S. automotive aftermarket industry, which includes
replacement parts, accessories, maintenance items, batteries and
automotive chemicals for cars and light trucks. The Company was
formed in 1929 as Advance Stores Co.
ASBESTOS LITIGATION: Allegheny Energy's W.Va. Suits Rise to 828
---------------------------------------------------------------
Allegheny Energy Inc., as of Dec. 31, 2006, recorded 828 open
asbestos-related cases in West Virginia and four open cases in
Pennsylvania, according to the Company's annual report filed
with the U.S. Securities and Exchange Commission on Feb. 28,
2007.
As of Oct. 10, 2006, the Company recorded 815 open asbestos-
related cases pending in West Virginia and six open cases
pending in Pennsylvania. (Class Action Reporter, Nov. 17, 2006)
The Company's utility units: Monongahela Power Co., the Potomac
Edison Co., and West Penn Power Co. co-defend in pending
asbestos cases alleging bodily injury involving multiple
plaintiffs and multiple sites.
These suits have been brought mostly by seasonal contractors'
employees and do not involve allegations of either the
manufacture, sale or distribution of asbestos-containing
products by the Company.
These asbestos suits arise out of historical operations and are
related to the installation and removal of asbestos-containing
materials at the Company's generation facilities.
Various foreign and domestic insurers, including Lloyd's of
London, insured the Company's historical operations. To date,
asbestos-related litigation expenses have been reimbursed in
full by recoveries from these historical insurers.
However, certain insurers have contested their obligations to
pay for the future defense and settlement costs relating to the
asbestos suits.
The Company is involved in two asbestos insurance-related
actions. These suits are styled: Certain Underwriters at
Lloyd's, London et al. v. Allegheny Energy, Inc. et al., Case
No. 21-C-03-16733, which is pending in Washington County, Md.,
and Monongahela Power Company et al. v. Certain Underwriters at
Lloyd's London and London Market Companies, et al., Civil Action
No. 03-C-281, which is pending in Monongalia County, W.Va.
The parties in these actions seek an allocation of
responsibility for historic and potential future asbestos
liability.
The Company and numerous others are plaintiffs in a similar
action filed against Zurich Insurance Co. in California, Fuller-
Austin Asbestos Settlement Trust, et al. v. Zurich-American
Insurance Co., et al., Case No. CGC 04 431719. The case is
pending at the Superior Court of California, County of San
Francisco.
Based in Greensburg, Pa., Allegheny Energy Inc.'s Allegheny
Power unit provides electricity to some 1.5 million customers in
five states and natural gas to more than 200,000 customers
through regulated utilities Monongahela Power, Potomac Edison,
and West Penn Power.
ASBESTOS LITIGATION: No Judgments Rendered in Actions v. AMETEK
---------------------------------------------------------------
AMETEK Inc. said that no judgments have been rendered against it
as a result of any asbestos-related lawsuit, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 28, 2007.
The Company and its subsidiaries have been named as co-
defendants in a number of asbestos-related lawsuits.
Many of these suits either relate to businesses which were
acquired by the Company and do not involve products which were
made or sold by the Company, or relate to previously owned
businesses of the Company which are under new ownership.
In connection with many of these suits, the sellers or new
owners of those businesses have agreed to indemnify the Company
against these claims.
The indemnified claims have been tendered to, and are being
defended by, those sellers and new owners. These sellers and new
owners have met their obligations in all respects.
Based in Paoli, Pa., AMETEK Inc. makes electronic instruments
and electromechanical devices with operations in North America,
Europe, Asia, and South America.
ASBESTOS LITIGATION: Badger Meter Still Faces Multi-Party Suits
---------------------------------------------------------------
Badger Meter Inc. continues to face multi-party asbestos-related
lawsuits pending in various states, according to the Company's
annual report filed with the U.S. Securities and Exchange
Commission on March 6, 2007.
These lawsuits assert claims alleging that certain industrial
products were manufactured by the defendants and were the cause
of injury and harm.
Based in Milwaukee, Badger Meter Inc., incorporated in 1905, is
a marketer and manufacturer of products, and a provider of
services, using flow measurement and control technologies
serving markets worldwide.
New Securities Fraud Cases
NEW CENTURY: Mager & Goldstein Files Securities Fraud Suit in CA
----------------------------------------------------------------
The law firm of Mager & Goldstein LLP filed a class action in
the U.S. District Court for the Central District of California
on behalf of all purchasers of securities of New Century
Financial Corp. between May 4, 2006 and March 2, 2007,
inclusive.
The Complaint alleges that defendants violated federal
securities laws by issuing materially false and misleading
statements during the Class Period which resulted in
artificially inflating the value of New Century stock.
New Century did not properly account for home loans it had to
repurchase and as a result its net earnings were materially
overstated for the periods ended March 31, June 30 and Sept. 30,
2006.
On Feb. 7, 2007 defendants shocked investors by revealing that
the company would have to restate its financial results. Then on
March 2, 2007, following the close of the market, New Century
disclosed that it had received notification from the U.S.
Attorney's Office that it was conducting a criminal inquiry in
connection with trading of New Century's stock and into the
company's accounting errors regarding accounting for its
repurchase losses. As a result of New Century's stunning
revelations, the price of New Century's stock initially
plummeted over 35 percent.
Following its revelation on March 2, 2007 that it faced
investigation of its accounting and stock trading, shares of New
Century crashed by more than 68 percent.
Interested parties may move the court no later than April 10,
2007 for lead plaintiff appointment.
For more information, contact Jayne Arnold Goldstein of Mager &
Goldstein LLP, 1640 Town Center Circle, Suite 216 Weston, FL
33326, Phone: (954) 515-0123 or 866-284-3280 (Toll Free), Fax:
(954) 515-0124, E-mail: jgoldstein@magergoldstein.com; or Lee
Albert, of Mager & Goldstein LLP, One Liberty Place, 21st Floor
1650 Market Street Philadelphia, PA 19103, Phone: (215) 640-3280
or 866-284-3280 (Toll Free), Fax: (215) 640-3281, Email:
lalbert@magergoldstein.com.
NOVASTAR FINANCIAL: Glancy Binkow Files Securities Fraud Suit
-------------------------------------------------------------
Glancy Binkow & Goldberg LLP has filed a class action in the
U.S. District Court for the Western District of Missouri on
behalf of a class consisting of all persons or entities who
purchased or otherwise acquired the common stock of NovaStar
Financial, Inc. (NYSE:NFI) between May 4, 2006 and Feb. 20,
2007.
The Complaint charges NovaStar and certain of the company's
executive officers and directors with violations of federal
securities laws.
Among other things, plaintiff claims that defendants' material
omissions and dissemination of materially false and misleading
statements concerning NovaStar's operations and prospects caused
the company's stock price to become artificially inflated,
inflicting damages on investors.
The Complaint alleges that during the Class Period defendants
made materially false and misleading statements to the investing
public and misrepresented or failed to disclose adverse facts,
including that:
(a) the company lacked requisite internal controls, and, as
a result, the company's projections and reported
results issued during the Class Period were based upon
defective assumptions about loan delinquencies;
(b) the company's financial statements were materially
misstated due to its failure to properly account for
its allowance for loan losses;
(c) given the deterioration and the increased volatility in
the subprime market, the company would be forced to
tighten its underwriting guidelines which would have a
direct material negative impact on its loan production
going forward; and
(d) given the increased volatility in the lending market,
the company had no reasonable basis to make projections
about its ability to maintain its Real Estate
Investment Trust (REIT) taxable income, which drives
dividends, and potentially even its very status as a
REIT.
As a result, the company's projections issued during the Class
Period about its REIT taxable income and dividends were at a
minimum reckless.
As a result of the foregoing, NovaStar shares traded at inflated
levels during the Class Period. However, after the above
revelations seeped into the market, massive sales of the
company's stock caused NovaStar shares to plummet more than 73%
from their Class Period high.
Plaintiff seeks to recover damages on behalf of Class members.
Interested parties may move the court no later than April 24,
2007 for lead plaintiff appointment.
NovaStar operates as a specialty finance company that
originates, purchases, invests in and services residential
nonconforming loans.
For more information, contact Lionel Z. Glancy and Michael
Goldberg, both of Glancy Binkow & Goldberg LLP, Los Angeles, CA,
Phone: (310) 201-9150, Fax: (888) 773-9224, E-mail:
info@glancylaw.com, Website: http://www.glancylaw.com.
*********
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, Ma. Cristina Canson, and Janice
Mendoza, Editors.
Copyright 2007. All rights reserved. ISSN 1525-2272.
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