/raid1/www/Hosts/bankrupt/CAR_Public/070816.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, August 16, 2007, Vol. 9, No. 161
Headlines
AMARANTH ADVISORS: Accused of Natural Gas Price Fixing in NYMEX
AMERICAN HOME: Shalov Stone Puts up Securities Suit Web Site
AMKOR TECHNOLOGY: Seeks Dismissal of Ariz. Securities Fraud Suit
CENTERPOINT ENERGY: Continues to Face Market Manipulation Cases
CENTERPOINT ENERGY: Court Mulls Appeal in Tex. ERISA Litigation
CENTERPOINT ENERGY: Still Faces Natural Gas Measurement Lawsuits
CENTERPOINT ENERGY: Gas Cost Recovery Suit in Ark. Revived
CHICAGO MERCANTILE: Settles Suit Filed by LAMPERS for $7.4M
CRUM & FORSTER: Seeks to Dismiss RICO, Antitrust Suit in N.J.
DIGIMARC CORP: Ruling in Securities Suit Appeal Expected 2008
EMACHINES INC: Hearing for $24M Empire Suit Settlement Set 2008
FISHER-PRICE INC: Sued Over Character Toys with High Lead Levels
FISERV TRUST: 9th Circuit Okays Appeal on “Jenson” Certification
HARLEY-DAVIDSON: Court Mulls Dismissal Motion in Info. Leak Suit
HARLEY-DAVIDSON: Wis. Court Mulls Motion to Dismiss ERISA Suit
HARLEY-DAVIDSON: Wis. Court Mulls Motion to Junk Securities Suit
HARMONIC INC: No Settlement Yet for Cal. Securities Fraud Suit
KEYSPAN CORP: Deal in Suit Over National Grid Merger Approved
L G SOURCING: Recalls Outdoor Lounge Chairs Posing Fall Hazard
LOEWS CORP: Updates on Pending Multi-Plaintiff Lawsuits
LOEWS CORP: No Hearings Yet for Tobacco-Related Antitrust Cases
MATTEL INC: Unit Sued in N.Y. Over Recalled Character Toys
OCE ENERGY: Enogex Units File Fact Findings in Price I
OCE ENERGY: Enogex Units File Fact Findings in Price II
OLD REPUBLIC: Continues to Face Several Title Insurance Lawsuits
PENNSYLVANIA: School District Accused of Racial Discrimination
RC2 CORP: Couple Files Suit Over Lead-Tainted Thomas Trains
SCE&G: Plaintiffs in “Collins” File Motion to Dismiss Lawsuit
SCE&G: Circuit Court Limits Class in S.C. Rights-of-Way Lawsuit
SOLUTIA INC: 2nd Circuit Hears Appeal on "Dickerson" Dismissal
SOLUTIA INC: Current Employee Files Lawsuit Over SIP Plan
TECO ENERGY: Oct. Hearing Set in Fla. Securities Suit Settlement
THOUSAND OAKS: Car Wash Accused of Abusing Undocumented Workers
New Securities Fraud Cases
COUNTRYWIDE FINANCIAL: Scott+Scott Files Securities Suit in Cal.
PALL CORP: Lerach Coughlin Files Securities Fraud Suit in N.Y.
QIAO XING: The Pomerantz Firm Files Securities Suit in N.Y.
*********
AMARANTH ADVISORS: Accused of Natural Gas Price Fixing in NYMEX
---------------------------------------------------------------
A class-action complaint filed Aug. 10 in the U.S. District Court for the
Southern District of New York accuses several companies of manipulating
natural gas futures on the New York Mercantile Exchange.
Named defendants in the complaint are:
-- Amaranth Advisors, L.L.C.,
-- Amaranth LLC,
-- Amaranth Group Inc.,
-- Amaranth International Limited,
-- Amaranth Partners LLC,
-- Amaranth Capital Partners LLC,
-- Amaranth Advisors (Calgary) ULC,
-- Nicholas M. Maounis,
-- Brian Hunter,
-- Matthew Donohoe,
-- ALX Energy, Inc.,
-- James DeLucia,
-- J.P. Morgan Futures, Inc.,
-- J.P. Morgan Chase & Co.
This action arises from Amaranth's alleged intentional and unlawful
manipulation of the prices of NYMEX natural gas futures contracts in
violation of the Commodity Exchange Act (CEA).
Named plaintiff John F. Special specifically alleges that:
(a) Amaranth intentionally drove up the price of NYMEX
natural gas futures contracts as part of a trading
scheme to artificially increase the "spread" between
the prices of NYMEX natural gas futures contracts for
delivery of natural gas during the summer months and
those for delivery during the winter months in order to
benefit Amaranth's NYMEX and over-the-counter natural
gas trading positions;
(b) Amaranth manipulated the final, or "settlement" price
of "prompt-month" NYMEX natural gas futures contract by
selling an extraordinary amount of such contracts
during the final day of trading. Amaranth engaged in
such conduct with the purpose and effect of driving
down the settlement price of the prompt-month NYMEX
natural gas futures contract in order to benefit their
natural gas positions, including natural gas swaps,
held on electronic energy exchanges, such as the
Intercontinental Exchange (ICE), whose value increased
as a direct result of the decrease in the settlement
price of the expiring NYMEX natural gas futures
contract. Thus, for every dollar lost on its sales of
its NYMEX natural gas futures positions, Amaranth would
gain multiple dollars on its natural gas positions on
ICE and other electronic energy exchanges.
(c) in support of their manipulative acts, Amaranth, with
the assistance, and knowledge, and support of the Floor
Trading and JPM defendants:
(i) repeatedly violated or caused to be violated NYMEX
exchange rules by amassing substantial NYMEX
natural gas futures contract positions that
exceeded applicable position limits; and
(ii) concealed their manipulative trading from
regulators and market participants by restructuring
and eventually increasing the size of Amaranth's
natural gas positions on ICE after Amaranth was
ordered by NYMEX to reduce its natural gas
positions on ICE after Amaranth was ordered by
NYMEX to reduce its natural gas positions which
were so large that they were distorting natural gas
market prices.
(d) JP Futures was Amaranth's clearing broker at NYMEX. As
Amaranth's clearing broker, JP Futures was the NYMEX's
counterparty for all positions it cleared in the
customer account with NYMEX, including the positions
held by Amaranth. JP Futures new Amaranth's entire
natural gas portfolio, and knew that Amaranth's
positions and trading strategies were designed to
manipulate NYMEX natural gas futures and options
contract prices. By knowingly financing and supporting
Amaranth's manipulative trading, JP Futures, with the
knowledge and consent of its parent, JPMC, aided and
abetted Amaranth's manipulation of NYMEX natural gas
futures prices in violation of the CEA;
(e) ALX Energy and James DeLucia were Amaranth's floor
traders on NYMEX. By knowingly executing Amaranth's
manipulative schemes by effecting Amaranth's trades in
the NYMEX natural gas "pit," the Floor Trading
defendants aided and abetted Amaranth's manipulation of
NYMEX natural gas futures prices in violation of the
CEA.
Plaintiffs bring this action behalf of all persons, other than defendants and
their employees, affiliates, parents or subsidiaries (whether or not named in
the complaint), who purchased and/or sold NYMEX natural gas futures and
options contracts between Feb. 23, 2006 and Sept. 20, 2006.
The plaintiff wants the court to rule :
(a) whether the alleged manipulation of NYMEX natural gas
futures contract prices based on defendants' unlawful
conduct violates the CEA;
(b) whether defendants' conduct had an effect on the prices
of NYMEX natural gas futures contracts and options
purchased or sold by plaintiff and the class during the
class period; and
(c) the appropriate measure of damages sustained by
plaintiff and the other members of the class.
Plaintiff prays for relief as follows:
-- for an order certifying the lawsuit as a class action
pursuant to Rules 23(a) and (b)(3) of the Federal Rules
of Civil Procedure, and designating plaintiff as the
class representative and his counsel as class counsel;
-- for a judgment awarding plaintiff and the class damages
against defendants for their violations of the CEA,
together with prejudgment interest at the maximum rate
allowed by law;
-- for an award to plaintiff and the class of their costs
of suit, including reasonable attorneys' and experts'
fees and expenses;
-- for such other and further relief as the court may deem
just and proper.
The suit is “Special v. Amaranth Advisors, L.L.C. et al., Case No. 1:07-cv-
07181-UA,” filed in the U.S. District Court for the Southern District of New
York.
Representing plaintiffs are:
Vincent Briganti
Geoffrey Milbank Horn
Lowey Dannenberg Bemporad Selinger & Cohen, P.C.
White Plains Plaza
One North Broadway, 5th Floor
White Plains, NY 10601
Phone: (914) 997-0500
Fax: (914) 997-0035
E-mail: vbriganti@lowey.com or ghorn@lowey.com
AMERICAN HOME: Shalov Stone Puts up Securities Suit Web Site
-------------------------------------------------------------
Shalov Stone Bonner & Rocco LLP created the Web site
http://www.ahmlawsuit.comto address investor interest in the American Home
Mortgage Investment Corp. securities fraud class action.
Shalov Stone has filed a securities fraud class action in the U.S. District
Court for the Eastern District of New York on behalf of all investors who
purchased or otherwise acquired the securities of American Home Mortgage
Investment Corp. (NYSE: AHM) in the period between July 26, 2006 and July 27,
2007, inclusive (Class Action Reporter, Aug 9, 2007).
The lawsuit names as defendants Michael Strauss and Stephen A. Hozie,
respectively the Company's CEO and CFO during the Class Period.
According to the complaint, the defendants violated the Securities Exchange
Act of 1934. Specifically, the complaint alleges that, during the Class
Period, the defendants issued materially false and misleading statements that
misrepresented and failed to disclose, among other things, that:
-- rising levels of loan delinquencies were depressing
the Company's earnings;
-- margins and profits were decreasing due to falling
prices caused by increasing difficulties with
selling loans; and
-- due to the foregoing, the Company was overstating
its financial results by failing to write down the
value of many of the loans in its portfolio that
had declined substantially in value.
The new Web site includes information about the case, a copy of the
complaint, and instructions on how to join the class action.
Following the publicity generated by the AHM class action, other lawyers have
issued press releases about the litigation, even though many did not file
cases of their own.
Shalov Stone Bonner & Rocco LLP commenced one of the first lawsuits relating
to AHM and is continuing to conduct an extensive investigation of the
company.
For additional information about the lawsuit, contact:
Thomas G. Ciarlone, Jr.
Shalov Stone Bonner & Rocco LLP
485 Seventh Avenue, Suite 1000
New York, New York 10018
Phone: (212) 239-4340
E-mail: tciarlone@lawssb.com
AMKOR TECHNOLOGY: Seeks Dismissal of Ariz. Securities Fraud Suit
----------------------------------------------------------------
Amkor Technology, Inc. is seeking the dismissal of an amended complaint in a
securities fraud class action filed against it in the U.S. District Court for
the District of Arizona.
The suit, “Nathan Weiss et al. v. Amkor Technology, Inc. et al.,” was filed
in the U.S. District Court for the Eastern District of Pennsylvania on Jan.
23, 2006.
The suit was filed against the company and certain of its current and former
officers. Subsequently, other law firms have filed related cases, which will
likely be consolidated with the initial complaint.
In August 2006 and again in November 2006, the plaintiffs amended the
complaint. Plaintiffs added additional officer, director and former director
defendants and allege improprieties in certain option grants.
The amended complaint further alleges that defendants improperly recorded and
accounted for the options in violation of generally accepted accounting
principles and made materially false and misleading statements and omissions
in its disclosures in violation of the federal securities laws, during the
period from
July 2001 to July 2006.
The amended complaint seeks certification as a class action pursuant to
Federal Rules of Civil Procedure 23, compensatory damages, costs and
expenses, and such other further relief as the court deems just and proper.
On Dec. 28, 2006, pursuant to motion by defendants, the U.S. District Court
for the Eastern District of Pennsylvania transferred this action to the U.S.
District Court for the District of Arizona.
Defendants have filed motions to dismiss the complaint, according to the
company’s Aug. 3, 2007 Form 10-Q Filing with the U.S. Securities and Exchange
Commission for the quarterly period ended June 30, 2007.
The suit is "In Re: Amkor Technology Inc. Securities Litigation, Case No.
2:06-cv-00610-LP," filed in the U.S. District Court for the Eastern District
of Pennsylvania under Judge Louis H. Pollak with referral to Judge M. Faith
Angell.
Representing the plaintiffs are:
Jacob A. Goldberg, Esq.
Faruqi & Faruqi, LLP
P.O. Box 30132
Elkins Park, PA 19027
Phone: 215-782-8235
E-mail: jgoldberg@faruqilaw.com
Evan J. Smith, Esq.
Brodsky & Smith, LLC
Two Bala Plaza, Suite 602
Bala Cynwyd, PA 19004
Phone: 610-667-6200
E-mail: esmith@brodsky-smith.com
Representing the defendants are:
Patrick Loftus, Esq.
Duane Morris, LLP
30 South 17th Street
Philadelphia, PA 19103-7396
Phone: 215-979-1367
E-mail: loftus@duanemorris.com
- and -
Karen T. Stefano, Esq.
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304
Phone: 650-849-3405
E-mail: kstefano@wsgr.com
CENTERPOINT ENERGY: Continues to Face Market Manipulation Cases
---------------------------------------------------------------
Centerpoint Energy Inc. continues to face lawsuits in relation to alleged
manipulation of electricity and natural gas markets in California and certain
other western states during an energy crisis in 2000-2001.
A large number of lawsuits have been filed against numerous market
participants and remain pending in federal court in California, Colorado and
Nevada and in state court in California and Nevada in connection with the
operation of the electricity and natural gas markets in California and
certain other western states in 2000-2001, a time of power shortages and
significant increases in prices.
These lawsuits, many of which have been filed as class actions, are based on
a number of legal theories, including violation of state and federal
antitrust laws, laws against unfair and unlawful business practices, the
federal Racketeer Influenced Corrupt Organization Act, false claims statutes
and similar theories and breaches of contracts to supply power to
governmental entities.
Plaintiffs in these lawsuits, which include state officials and governmental
entities as well as private litigants, are seeking a variety of forms of
relief, including recovery of compensatory damages (in some cases in excess
of $1 billion), a trebling of compensatory damages and punitive damages,
injunctive relief, restitution, interest due, disgorgement, civil penalties
and fines, costs of suit, attorneys' fees and divestiture of assets.
Centerpoint Energy's former subsidiary, Reliant Resources, Inc. (RRI), now
Reliant Energy, Inc., was a participant in the California markets, owning
generating plants in the state and participating in both electricity and
natural gas trading in that state and in western power markets generally.
The Centerpoint Energy and/or Reliant Energy have been named in approximately
30 of these lawsuits, which were instituted between 2001 and 2006 and are
pending in California state court in San Diego County, in Nevada state court
in Clark County, in federal district court in Colorado, Nevada and the
Northern District of California and before the Ninth Circuit Court of
Appeals.
However, Centerpoint Energy, CenterPoint Houston and Reliant
Energy were not participants in the electricity or natural gas markets in
California. Centerpoint Energy and Reliant Energy have been dismissed from
certain of the lawsuits, either voluntarily by the plaintiffs or by order of
the court, and
Centerpoint Energy believes it is not a proper defendant in the remaining
cases and will continue to seek dismissal from such remaining cases.
Several of the electricity complaints have been dismissed, and several of the
dismissals have been affirmed by appellate courts. Others have been resolved
by the settlement. Four of the gas complaints have also been dismissed based
on defendants' claims of federal preemption and the filed rate doctrine, and
these dismissals have been appealed. In June 2005, a San Diego state court
refused to dismiss other gas complaints on the same basis. The other gas
cases remain in the early procedural stages.
FERC Settlement
On August 12, 2005, Reliant Resources reached a settlement with the Federal
Energy Regulatory Commission (FERC) enforcement staff, the states of
California, Washington and Oregon, California's three largest investor-owned
utilities, classes of consumers from California and other western states, and
a number of California city and county government entities that resolves
their claims against RRI related to the operation of the electricity markets
in California and certain other western states in 2000-2001.
The settlement also resolves the claims of the three states and the investor-
owned utilities related to the 2000-2001 natural gas markets. The settlement
has been approved by the FERC, by the California Public Utilities Commission,
and by the courts in which the electricity class action cases are pending.
Two parties have appealed the courts' approval of the settlement to the
California Court of Appeals. A party in the FERC proceedings filed a motion
for rehearing of the FERC's order approving the settlement, which the FERC
denied on May 30, 2006.
That party has filed for review of the FERC's orders in the Ninth Circuit
Court of Appeals.
Centerpoint Energy is not a party to the settlement, but may rely on the
settlement as a defense to any claims brought against it related to the time
when Centerpoint Energy was an affiliate of Reliant Resources. The terms of
the settlement do not require payment by Centerpoint Energy.
CENTERPOINT ENERGY: Court Mulls Appeal in Tex. ERISA Litigation
---------------------------------------------------------------
The U.S. Court of Appeals for the 5th Circuit has yet to rule on an appeal
against a summary judgment granted in favor of CenterPoint Energy, Inc. in a
purported class action alleging violations of the Employee Retirement Income
Security Act of 1974.
In May 2002, three class actions were filed in the U.S. District Court for
the Southern District of Texas Houston on behalf of participants in various
company-sponsored employee benefits plans. Two of the lawsuits were
dismissed without prejudice.
In the remaining lawsuit, the company and certain current and former members
of its benefits committee are defendants. That suit alleged that the
defendants breached their fiduciary duties to various employee benefits
plans, directly or indirectly sponsored by the company, in violation of ERISA
by permitting the plans to purchase or hold securities issued by the company
when it was imprudent to do so, including after the prices for such
securities became artificially inflated because of alleged securities fraud
engaged in by the defendants.
The complaint sought monetary damages for losses suffered on behalf of the
plans and a putative class of plan participants whose accounts held
CenterPoint Energy or Reliant Resources, Inc. securities, as well as
restitution.
In January 2006, the federal district judge granted a motion for summary
judgment filed by the company and the individual defendants. The plaintiffs
filed an appeal of the ruling to the 5th Circuit Court of Appeals.
The company reported no development in the case at its Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarterly period ended
June 30, 2007.
The suit is "Boca Raton Police &, et al. v. Reliant Resources, et al., Case
No. 4:02-cv-01810," filed in the U.S. District
Court for the Southern District of Texas, Houston Division under
Judge Ewing Werlein, Jr.
Representing the plaintiffs are:
Jacks C. Nickens, Esq.
Nickens Keeton et al
600 Travis, Ste. 7500
Houston, TX 77002
Phone: 713-571-9191
Fax: 713-571-9652
Niki L. O'Neel, Esq.
Alan Schulman, Esq.
David R. Stickney, Esq.
Bernstein Litowitz et al
12544 High Bluff Dr., Ste. 150
San Diego, CA 92130
Phone: 858-793-0070
- and -
Peter A. Pease, Esq.
Michael J. Pucillo, Esq.
Wendy Hope, Esq.
Zoberman, Berman DeValerio & Pease
One Liberty Square,
Boston, MA 09109
Phone: 617-542-8300
Fax: 617-542-1194.
Representing the company is:
James Edward Maloney, Esq.
Baker & Botts
910 Louisiana, Ste 3000
Houston, TX 77002
Phone: 713-229-1255
Fax: 713-229-7755
CENTERPOINT ENERGY: Still Faces Natural Gas Measurement Lawsuits
----------------------------------------------------------------
CenterPoint Energy Resources Corp. (CERC Corp.) and certain of its
subsidiaries are defendants in two mismeasurement lawsuits brought against
approximately 245 pipeline companies and their affiliates pending in state
court in Stevens County, Kansas.
In one case originally filed in May 1999 and amended four times, the
plaintiffs purport to represent a class of royalty owners who allege that the
defendants have engaged in systematic mismeasurement of the volume of natural
gas for more than 25 years.
The plaintiffs amended their petition in this suit in July 2003 in response
to an order from the judge denying certification of the plaintiffs’ alleged
class. In the amendment, the plaintiffs dismissed their claims against
certain defendants (including two CERC Corp. subsidiaries), limited the scope
of the class of plaintiffs they purport to represent and eliminated
previously asserted claims based on mismeasurement of the British thermal
unit (Btu) content of the gas.
The same plaintiffs then filed a second lawsuit, again as representatives of
a putative class of royalty owners, in which they assert their claims that
the defendants have engaged in systematic mismeasurement of the Btu content
of natural gas for more than 25 years.
In both lawsuits, the plaintiffs seek compensatory damages, along with
statutory penalties, treble damages, interest, costs and fees.
CENTERPOINT ENERGY: Gas Cost Recovery Suit in Ark. Revived
----------------------------------------------------------
Plaintiffs in a suit filed in Miller County, Arkansas over rates charged to
certain consumers of natural gas in several states, amended their complaint
to allege, among other things, that the conduct affected rates charged to
consumers in Minnesota.
In October 2002, a suit was filed in state district court in Wharton County,
Texas against:
* Centerpoint Energy Inc.,
* CenterPoint Energy Resources (CERC),
* Entex Gas Marketing Company, and
* certain non-affiliated companies
alleging fraud, violations of the Texas Deceptive Trade Practices Act,
violations of the Texas Utilities Code, civil conspiracy and violations of
the Texas Free Enterprise and Antitrust Act with respect to rates charged to
certain consumers of natural gas in the State of Texas.
Subsequently, the plaintiffs added as defendants:
* CenterPoint Energy Marketing Inc.,
* CenterPoint Energy Gas Transmission Company (CEGT),
* United Gas, Inc.,
* Louisiana Unit Gas Transmission Co.,
* CenterPoint Energy Pipeline Services, Inc., and
* CenterPoint Energy Trading, and
* Transportation Group, Inc.,
all of which are subsidiaries of the Company.
The plaintiffs alleged that defendants inflated the prices charged to certain
consumers of natural gas.
In February 2003, a similar lawsuit was filed in state court in Caddo Parish,
Louisiana against CERC with respect to rates charged to a purported class of
certain consumers of natural gas and gas service in the State of Louisiana.
In February 2004, another suit was filed in state court in Calcasieu Parish,
Louisiana against CERC seeking to recover alleged overcharges for gas or gas
services allegedly provided by CERC to a purported class of certain consumers
of natural gas and gas service without advance approval by the Louisiana
Public Service Commission (LPSC).
In October 2004, a similar case was filed in district court in Miller County,
Arkansas against:
* the Company,
* CERC,
* Entex Gas Marketing Co.,
* CEGT,
* CenterPoint Energy Field Services,
* CenterPoint Energy Pipeline Services, Inc.,
* Mississippi River Transmission Corp. (MRT)
and other non-affiliated companies alleging fraud, unjust enrichment and
civil conspiracy with respect to rates charged to certain consumers of
natural gas in at least the states of Arkansas, Louisiana, Mississippi,
Oklahoma and Texas.
Subsequently, the plaintiffs dropped CEGT and MRT as defendants, but in July
2007, plaintiffs amended their complaint to allege, among other things, that
the alleged conduct affected rates charged to consumers in Minnesota. At the
time of the filing of each of the Caddo and Calcasieu Parish cases, the
plaintiffs in those cases filed petitions with the LPSC relating to the same
alleged rate overcharges.
The Caddo and Calcasieu Parish cases have been stayed pending the resolution
of the respective proceedings by the LPSC. The plaintiffs in the Miller
County case are seeking class certification, but the proposed class has not
been certified.
In June 2007, the Arkansas Supreme Court issued an opinion addressing the
Miller County district court’s jurisdiction over the plaintiffs’ claims and
ruled that the complaint was a challenge to gas rates over which the Arkansas
Public Service Commission (APSC) has exclusive jurisdiction with regard to
Arkansas customers.
The Arkansas Supreme Court declined to adjudicate the issue of the
jurisdiction of the Railroad Commission over Texas customers. Following the
decision by the Arkansas Supreme Court, the Miller County court ruled that
the Arkansas consumer claims would be stayed pending action by the APSC to
consider the commission’s jurisdiction over the claims, but denied other
motions to dismiss that had been urged by the defendants.
In June 2007, CERC and other defendants in the Miller County case filed a
petition for declaratory judgment in a district court in Travis County,
Texas, seeking a determination that the Railroad Commission has exclusive
jurisdiction over the Texas claims asserted by the plaintiffs.
In February 2005, the Wharton County case was removed to federal district
court in Houston, and in March 2005, the plaintiffs voluntarily moved to
dismiss the case and agreed not to refile the claims asserted unless the
Miller County case is not certified as a class action or is later
decertified.
The range of relief sought by the plaintiffs in these cases includes
injunctive and declaratory relief, restitution for the alleged overcharges,
disgorgement of illegal profits, exemplary damages or trebling of actual
damages, civil penalties and attorney’s fees.
In these cases, the Company, CERC and their affiliates deny that they have
overcharged any of their customers for natural gas and believe that the
amounts recovered for purchased gas have been in accordance with what is
permitted by state and municipal regulatory authorities.
The Company and CERC do not expect the outcome of these matters to have a
material impact on the financial condition, results of operations or cash
flows of either the Company or CERC.
CHICAGO MERCANTILE: Settles Suit Filed by LAMPERS for $7.4M
------------------------------------------------------------
A tentative settlement was reached in the purported class action, “Louisiana
Municipal Employees’ Retirement System v. CBOT Holdings, Inc., et al. Case
No. 2803,” that names Chicago Mercantile Exchange Holdings, Inc., (CME
Holdings), as a defendant.
On March 16, 2007, Louisiana Municipal Police Employees’ Retirement System
(LAMPERS) filed a class action complaint in the Delaware Court of Chancery
against CBOT Holdings, its directors and CME Holdings.
The complaint alleges, among other things, that CBOT Holdings and its
directors breached their fiduciary duties related to the sale of CBOT
Holdings by approving allegedly improper deal protection devices including a
$240.0 million termination fee and a no-shop/no-talk provision.
It further alleges that CME Holdings aided and abetted the alleged breaches
of fiduciary duty.
Based on revisions to the merger providing for the special dividend and
granting appraisal rights to holders of shares of CBOT Holdings, the company
and LAMPERS have reached a memorandum of understanding for the settlement of
this litigation, which was contingent upon the closing of the merger and
remains subject to final approval of the court.
As part of the settlement, the company has agreed to pay the fees and
expenses of plaintiff’s counsel in an amount not to exceed $7.4 million. The
company expects to recognize these settlement costs in the third quarter of
2007.
The suit is "Louisiana Municipal Employees’ Retirement System v. CBOT
Holdings, Inc., et al. Case No. 2803," filed in the Court of the Chancery of
the State of Delaware in and for New Castle County.
Representing the plaintiffs are:
Gerald H. Silk, Esq.
Bernstein Litowitz Berger & Grossmann LLP
1285 Avenue of the Americas
New York, NY 10019
Phone: (212) 554-1282 and (212) 554-1400
Fax: (212) 554-1444
E-mail: jerry@blbglaw.com
Web site: http://www.blbglaw.com
- and –
Stuart M. Grant, Esq.
Grant & Eisenhofer, P.A.
1201 N. Market Street, Suite 2100
Wilmington, DE 19801
Phone: (302) 622-7070
Fax: (302) 622-7100
E-mail: sgrant@gelaw.com
Web site: http://www.gelaw.com/stuartm_grant.cfm
CRUM & FORSTER: Seeks to Dismiss RICO, Antitrust Suit in N.J.
--------------------------------------------------------------
The U.S. District Court for the District of New Jersey has indicated that
oral arguments are unlikely to be conducted in relation to a motion to
dismiss a suit filed against Crum & Forster Holdings Corp. over allegations
it violated both the Racketeer Influenced and Corrupt Organizations Act and
antitrust statutes.
The company and U.S. Fire, among numerous other insurance company and
insurance broker defendants, have been named as defendants in a class action
filed by policyholders alleging, among other things, that the defendants used
contingent commission structure to deprive policyholders of free competition
in the market for insurance.
Plaintiffs seek certification of a nationwide class consisting of all persons
who between Aug. 26, 1994 and the date of the class certification engaged the
services of any one of the broker defendants and who entered into or renewed
a contract of insurance with one of the insurer defendants.
In October 2006, the court partially granted defendants' motion to dismiss
the plaintiffs' complaint, subject to plaintiffs' filing an amended statement
of their case.
Plaintiffs thereafter filed their "supplemental statement of particularity"
and amended case statement. In response, defendants filed a renewed motion
to dismiss.
In April 2007, the plaintiffs’ RICO and antitrust claims were again dismissed
without prejudice.
Plaintiffs filed their amended petition on May 22, 2007. The Crum & Forster
entities continue to be named as defendants.
Defendants filed their renewed motions to dismiss on June 21, 2007.
Plaintiffs filed responses to the motions by July 19, 2007 and defendants
filed replies by July 31, 2007.
The Court issued a statement on July 20, 2007 indicating oral arguments
likely will not be conducted. Crum & Forster Holdings Corp. and U.S. Fire
intend to vigorously defend the action.
Crum & Forster Holdings Corp. -- http://www.cfins.com-- through its eight
subsidiaries, offers an array of property/casualty insurance products to
businesses, including management liability, automobile, and workers'
compensation coverage.
DIGIMARC CORP: Ruling in Securities Suit Appeal Expected 2008
--------------------------------------------------------------
Digimarc Corp. is expecting the U.S. District Court for the District of
Oregon to issue in 2008 a ruling on an appeal against the dismissal of a
consolidated securities fraud lawsuit filed against the company.
a decision in 2008 for plaintiffs’ motion in a dismissed consolidated
securities fraud lawsuit filed against the company in.
Beginning in September 2004, three purported class actions were filed in the
U.S. District Court for the District of Oregon against the company and
certain of its current and former directors and officers on behalf of
purchasers of the company's securities during the period April 17, 2002 to
July 28, 2004.
These lawsuits were later consolidated into one action for all purposes. The
amended complaint, which sought unspecified damages, asserted claims under
the federal securities laws relating to the company's restatement of its
financial statements for 2003 and the first two quarters of 2004 and alleged
that the company issued false and misleading financial statements and issued
misleading public statements about the company's operations and prospects.
On Aug. 4, 2006, the court granted the Company’s motion to dismiss the
lawsuit with prejudice and entered judgment in the Company’s favor.
Plaintiffs have filed a notice of appeal in the Ninth Circuit Court of
Appeals. The appeal was stayed pending the recent U.S. Supreme Court’s
determination in another case of issues relating to the Private Securities
Litigation Reform Act, and briefing is scheduled to be completed by the end
of the year.
The Company anticipates oral argument and a decision in 2008, according to
the company’s Aug. 3, 2007 Form 10-Q Filing with the U.S. Securities and
Exchange Commission for the quarterly period ended June 30, 2007.
The suit is “Garcia et al. v. Digimarc Corp. et al., Case No. 3:04-cv-01455-
BR,” filed in the U.S. District Court for the District of Oregon under Judge
Anna J. Brown.
Representing the plaintiffs are:
Gary M. Berne, Esq.
Stoll Stoll Berne Lokting & Shlachter
PC, 209 S.W. Oak Street, Fifth Floor
Portland, OR 97204
Phone: (503) 227-1600
Fax: (503) 227-6840
E-mail: gberne@ssbls.com
- and -
Gary I. Grenley, Esq.
Paul H. Trinchero, Esq.
Grenley Rotenberg Evans Bragg & Bodie PC
1211 SW Fifth Avenue, Suite 1100
Portland, OR 97204
Phone: (503) 241-0570
Fax: (503) 241-0914
E-mail: ggrenley@grebb.com
ptrinchero@grebb.com
EMACHINES INC: Hearing for $24M Empire Suit Settlement Set 2008
----------------------------------------------------------------
A Jan. 24, 2008 hearing was set for a tentative $24 million settlement that
was reached for the shareholder class action, “Dvorchak v. eMachines, Inc.,
et al.,” which was filed in California State Superior Court, County of Orange.
Former rival Gateway, Inc. acquired eMachines for approximately $235 million
in cash and stock back in 2004.
The suit, filed against eMachines and others in November 2001, relates to a
plan to privatize the company through a merger with
Empire Acquisition Corp. The merger was consummated after a court denied a
requested injunction on Dec. 27, 2001.
After the merger, plaintiffs filed amended complaints seeking unspecified
monetary damages and/or rescission relating to the negotiations for and terms
of the merger through allegations of breaches of fiduciary duties by
eMachines, its board members prior to the merger, and certain of its
officers. The court certified the suit as a class action on Aug. 25, 2003.
On July 25, 2007, the court granted final approval of a settlement negotiated
between the parties to the lawsuit and eMachines’ insurance carriers.
The settlement provides for a $24 million fund. Neither eMachines nor
Gateway is contributing to the settlement fund.
A hearing to provide a final accounting in accordance with the settlement is
currently scheduled for Jan. 24, 2008, after which the action is expected to
be dismissed pursuant to the settlement, according to Gateway, Inc.’s Aug. 2,
2007 Form 10-Q Filing with the U.S. Securities and Exchange Commission for
the quarterly period ended June 30, 2007.
eMachines, Inc., -- http://www.emachines.com/-- sells personal computers and
peripheral displays. Marketed toward budget-conscious consumers, its desktop
and notebook PCs are sold by retailers such as Best Buy, Circuit City, and
Office Depot.
FISHER-PRICE INC: Sued Over Character Toys with High Lead Levels
----------------------------------------------------------------
Fisher Price, Inc. and Mattel, Inc. are facing a lawsuit seeking class
certification concerning certain tainted toys from China that were sold in
the U.S.
Fisher-Price of East Aurora, New York, in cooperation with the U.S. Consumer
Product Safety Commission, has recalled about 967,000 units of Sesame Street,
Dora the Explorer, and other children’s toys (Class Action Reporter, Aug 3,
2007).
The company said the surface paints on the toys could contain excessive
levels of lead. Lead is toxic if ingested by young children and can cause
adverse health effects. No injuries have been reported.
The recalled involves various figures and toys that were manufactured between
April 19, 2007 and July 6, 2007 and were sold alone or as part of sets. The
toys may have a date code between 109-7LF and 187-7LF marked on the product
or packaging.
These recalled licensed character toys were manufactured in China and are
being sold at retail stores nationwide from May 2007 through August 2007 for
between $5 and $40.
Lance A. Harke, one of Plaintiff's counsel, says, "It is important to protect
children from injury. And when injury has occurred, that harm has to be
corrected. While defendants in a lawsuit might disagree as to how one goes
about correcting and stopping those harms, it is hoped that they would share
those views.
“Here, the moneys parents will be forced to spend to protect their children
from known danger should be the responsibility of the defendants, as with the
responsibility to return moneys for products that should not have been sold,
and to provide the broadest notice possible for the destruction of such toys.
“Our legal system protects consumers caught in harm's way. With this type of
serious problem, the time for correction is now, and not when sellers of such
products feel like doing what their limited view may offer. Hopefully, Ms.
Shoukry's lawsuit and her dedicated actions will help bring about a prompt
resolution with a lasting message and impact."
For more information, contact:
Lance A. Harke
Harke & Clasby LLP
155 South Miami Avenue Suite 600
Miami, FL 33130
Phone: (305)536-8220
Fax: (305)536-8229
Email: lharke@harkeclasby.com
Website: http://www.harkeclasby.com
- and -
Ben Barnow
Barnow and Associates, P.C.
One North LaSalle Street, Suite 4600
Chicago, Illinois 60602
Phone: 312-621-2000
Fax: 312-641-5504
FISERV TRUST: 9th Circuit Okays Appeal on “Jenson” Certification
----------------------------------------------------------------
The U.S. Court of Appeals for the Ninth Circuit has allowed defendants in a
lawsuit filed against Fiserv Trust Co. in the U.S. District Court for the
Central District of California to appeal a certification of a class in the
suit.
Recently, the California federal court certified a class in a lawsuit, which
was filed against the company in 2005 by investors who maintained self-
directed individual retirement accounts administered by Fiserv Trust (Class
Action Reporter, May 14, 2007).
The suit alleges that Fiserv Trust, which serves as a custodian and
administrator of investment accounts, knew or should have known that third
parties were perpetrating an alleged Ponzi scheme and that it breached its
contractual and common law duties and aided and abetted the scheme by not
advising the plaintiffs to avoid investing in the alleged scheme.
It was brought on behalf of a class of investors who maintained self-directed
individual retirement accounts administered by Fiserv Trust and others who
invested in the alleged scheme, including investors that were never customers
of Fiserv Trust, and seeks compensatory damages of $120 million and punitive
damages.
In May, the U.S. Court of Appeals for the Ninth Circuit granted a petition
for permission to appeal the class certification order.
The class certification is now being appealed, according to the company’s
Aug. 3, 2007 Form 10-Q Filing with the U.S. Securities and Exchange
Commission for the quarterly period ended June 30, 2007.
The suit is “Jerome Jenson et al. v. First Trust Company et al., Case No.
2:05-cv-03124-ABC-CT,” filed in the U.S. District Court for the Central
District of California under Judge Audrey B. Collins with referral to Judge
Carolyn Turchin.
Representing the plaintiffs is:
Lionel Z. Glancy, Esq.
Glancy Binkow and Goldberg
1801 Avenue of the Stars, Suite 311
Los Angeles, CA 90067
Phone: 310-201-9150
E-mail: info@glancylaw.com
Representing the defendants is:
Casey N. Carrington, Esq.
Gibson Dunn and Crutcher
333 South Grand Avenue
Los Angeles, CA 90071
Phone: 213-229-7000
E-mail: ccarington@gibsondunn.com
HARLEY-DAVIDSON: Court Mulls Dismissal Motion in Info. Leak Suit
----------------------------------------------------------------
The U.S. District Court for the Southern District of New York has yet to rule
on a motion seeking for the dismissal of a purported class action against
Harley-Davidson, Inc., and the Harley Owners Group.
The suit was originally filed in the Supreme Court of the State of New York
on Jan. 22, 2007, but has been transferred to the U.S. District Court for the
Southern District of New York on Feb. 23, 2007.
The complaint alleges that the company was negligent in failing to properly
safeguard, protect and keep confidential the personal "Customer Identifiable
Information" that was stored on a company laptop computer that was lost on or
about Aug. 14,
2006.
The complaint also alleges that Harley-Davidson breached fiduciary duties and
made false and fraudulent representations and warranties to its customers
that it would keep confidential and safeguard and protect the personal
customer information in its possession. It seeks unspecified damages.
On April 5, 2007, the Company filed a motion to dismiss the complaint.
Briefing is completed on the motion to dismiss and the parties are awaiting a
ruling, according to the company’s Aug. 3, 2007 Form 10-Q Filing with the
U.S. Securities and Exchange Commission for the quarterly period ended July
1, 2007.
The suit is "Shafran v. Harley-Davidson, Inc. et al., Case No. 1:07-cv-01365-
GBD," filed in the U.S. District Court for the Southern District of New York
under Judge George B. Daniels.
Representing the defendant is:
Stephen Randall Neuwirth, Esq.
Quinn Emanuel Urquhart Oliver & Hedges LLP
51 Madison Avenue, 22nd Floor
New York, NY 10010
Phone: (212) 702-8100 x8165
Fax: (212) 702-8200
E-mail: stephenneuwirth@quinnemanuel.com
HARLEY-DAVIDSON: Wis. Court Mulls Motion to Dismiss ERISA Suit
---------------------------------------------------------------
The U.S. District Court for the Eastern District of Wisconsin has yet to rule
on a motion seeking the dismissal of a purported class action filed against
Harley-Davidson, Inc. and certain of its officers over alleged violations of
the Employee Retirement Income Security Act.
On Aug. 25, 2005, a class action alleging violations of ERISA was filed in
the U.S. District Court for the Eastern District of Wisconsin.
On Feb. 15, 2006, the court ordered the ERISA action consolidated with the
federal derivative and securities actions filed in the same court for
administrative purposes.
Pursuant to the schedule set by the court, on Oct. 2, 2006, the ERISA
plaintiff filed an Amended Class Action Complaint, which named as defendants:
-- the company,
-- the Harley-Davidson Motor Co. Retirement Plans
Committee,
-- the company's Leadership and Strategy Council.
It also named current or former company officers or employees, including:
-- Harold A. Scott,
-- James L. Ziemer,
-- James M. Brostowitz,
-- Gail A. Lione,
-- Joanne M. Bischmann,
-- Karl M. Eberle,
-- Jon R. Flickinger,
-- Ronald M. Hutchinson,
-- James A. McCaslin,
-- W. Kenneth Sutton, Jr., and
-- Donna F. Zarcone.
In general, the ERISA complaint includes factual allegations similar to those
in shareholder class actions filed against the company and alleges on behalf
of participants in certain Harley Davidson retirement savings plans that the
plan fiduciaries breached their ERISA fiduciary duties.
On Dec. 18, 2006, the defendants filed a motion to dismiss the ERISA
complaint in its entirety. Briefing of the motion to dismiss was completed
in April 2007.
The company reported no development in the matter in its Aug. 3, 2007 Form 10-
Q Filing with the U.S. Securities and Exchange Commission for the quarterly
period ended July 1, 2007.
Harley-Davidson, Inc. -- http://www.harley-davidson.com-- operates in two
segments: the Motorcycles & Related Products segment and the Financial
Services segment. The Motorcycles & Related Products (Motorcycles) segment
includes the group of companies doing business as Harley-Davidson Motor
Company (Motor Company) and the group of companies doing business as Buell
Motorcycle Company (Buell).
HARLEY-DAVIDSON: Wis. Court Mulls Motion to Junk Securities Suit
----------------------------------------------------------------
The U.S. District Court for the Eastern District of Wisconsin has yet to rule
on a motion seeking for the dismissal of a consolidated securities fraud
class action filed against Harley-Davidson, Inc. and certain of its officers.
Initially, a number of shareholder class actions were filed between May 18,
2005 and July 1, 2005. On Feb. 14, 2006, the court consolidated all of the
actions into a single case, captioned, “In re Harley-Davidson, Inc.
Securities Litigation,” and appointed lead plaintiffs and co-lead plaintiffs'
counsel.
Pursuant to the schedule set by the court, on Oct. 2, 2006, the lead
plaintiffs filed a Consolidated Class Action Complaint, which names the
company and Jeffrey L. Bleustein, James L. Ziemer, and James M. Brostowitz,
who are company officers, as defendants.
The consolidated complaint alleges securities law violations and seeks
unspecified damages relating generally to the company's April 13, 2005
announcement that it was reducing short-term production growth and planned
increases of motorcycle shipments from 317,000 units in 2004 to a new 2005
target of 329,000 units (compared to its original target of 339,000 units).
On Dec. 18, 2006, the defendants filed a motion to dismiss the Consolidated
Complaint in its entirety. Briefing of the motion to dismiss was completed
in April 2007.
The company reported no development in the matter in its Aug. 3, 2007 Form 10-
Q Filing with the U.S. Securities and Exchange Commission for the quarterly
period ended July 1, 2007.
Harley-Davidson, Inc. -- http://www.harley-davidson.com-- operates in two
segments: the Motorcycles & Related Products segment and the Financial
Services segment. The Motorcycles & Related Products (Motorcycles) segment
includes the group of companies doing business as Harley-Davidson Motor
Company (Motor Company) and the group of companies doing business as Buell
Motorcycle Company (Buell).
HARMONIC INC: No Settlement Yet for Cal. Securities Fraud Suit
---------------------------------------------------------------
No agreement was reached in a mediation held in May to settle a consolidated
securities class action filed against Harmonic, Inc.
Between June 28 and Aug. 25, 2000, several actions alleging violations of the
federal securities were filed in or removed to the U.S. District Court for
the Northern District of California.
The actions were subsequently consolidated.
A consolidated complaint, filed on Dec. 7, 2000, was brought on behalf of a
purported class of persons who purchased Harmonic's publicly traded
securities between Jan. 19 and June 26, 2000.
It alleged claims on behalf of a purported subclass of persons who purchased
C-Cube Microsystems Inc. securities between Jan. 19 and May 3, 2000.
In addition to the company and certain of its officers and directors, the
complaint also named C-Cube Microsystems and several of its officers and
directors as defendants.
The complaint alleged that, by making false or misleading statements
regarding Harmonic's prospects and customers and its acquisition of C-Cube,
certain defendants violated sections 10(b) and 20(a) of the U.S. Securities
Exchange Act of 1934.
The complaint also alleged that certain defendants violated section 14(a) of
the Exchange Act and sections 11, 12(a)(2), and 15 of the U.S. Securities Act
of 1933 by filing a false or misleading registration statement, prospectus,
and joint proxy in connection with the C-Cube acquisition.
On July 3, 2001, the District Court dismissed the consolidated complaint with
leave to amend. An amended complaint alleging the same claims against the
same defendants was filed on Aug. 13, 2001.
Defendants moved to dismiss the amended complaint on Sept. 24,
2001. On Nov. 13, 2002, the District Court issued an opinion granting the
motions to dismiss the amended complaint without leave to amend. Judgment
for defendants was entered on
Dec. 2, 2002.
On Dec. 12, 2002, plaintiffs filed a motion to amend the judgment and for
leave to file an amended complaint pursuant to Rules 59(e) and 15(a) of the
Federal Rules of Civil Procedure. On June 6, 2003, the District Court denied
plaintiffs' motion to amend the judgment and for leave to file an amended
complaint.
Plaintiffs filed a notice of appeal on July 1, 2003. A panel of three judges
from the U.S. Court of Appeals for the 9th Circuit heard the appeal on Feb.
17, 2005.
On Nov. 8, 2005, the 9th Circuit panel affirmed in part, reversed in part,
and remanded for further proceedings the decision of the District Court.
The 9th Circuit affirmed the District Court's dismissal of the plaintiffs'
fraud claims under Sections 10(b), 14(a), and 20(a) of the Exchange Act with
prejudice, finding that the plaintiffs failed to adequately plead their
allegations of fraud.
The 9th Circuit reversed the District Court's dismissal of the plaintiffs'
claims under Sections 11 and 12(a)(2) of the Securities Act, however, finding
that those claims did not allege fraud and therefore were subject to only
minimal pleading standards.
Regarding the secondary liability claim under Section 15 of the
Securities Act, the 9th Circuit reversed the dismissal of that claim against
Anthony J. Ley, the company's chairman and chief executive officer, and
affirmed the dismissal of that claim against Harmonic, while granting leave
to amend. The 9th Circuit remanded the surviving claims to the District
Court for further proceedings.
On Nov. 22, 2005, both the Harmonic defendants and the plaintiffs petitioned
the 9th Circuit for a rehearing of the appeal. On Feb. 16, 2006 the 9th
Circuit denied both petitions.
On May 17, 2006 the plaintiffs filed an amended complaint on the issues
remanded for further proceedings by the 9th Circuit, to which the Harmonic
defendants responded with a motion to dismiss certain claims and to strike
certain allegations.
On Dec. 11, 2006, the court granted the motion to dismiss with respect to the
Section 12(a)(2) claim against the individual Harmonic defendants and granted
the motion to strike, but denied the motion to dismiss the Section 15 claim.
A case management conference was held on Jan. 25, 2007, at which the court
set a trial date in August 2008, with discovery to close in February 2008.
The court also ordered the parties to attend a settlement conference with a
magistrate judge or a private mediation before
June 30, 2007.
A mediation session was held on May 24, 2007 at which the parties were unable
to reach a settlement, according to the company’s Aug. 3, 2007 Form 10-Q
Filing with the U.S. Securities and Exchange Commission for the quarterly
period ended June 29, 2007.
Harmonic, Inc. -- http://www.harmonicinc.com/-- designs, manufactures and
sells products and systems that enable network operators to provide a range
of interactive and advanced digital services that include digital video,
video-on-demand, high-definition television, high-speed Internet access and
telephony.
The Company's products generally fall into two categories: video processing
products, and edge and access products.
KEYSPAN CORP: Deal in Suit Over National Grid Merger Approved
-------------------------------------------------------------
The New York State Supreme Court for the County of Kings gave final approval
to a tentative settlement of a purported class action against KeySpan Corp.
with regards to its Merger Agreement with National Grid plc.
On March 20, 2006, a purported class action lawsuit was filed alleging breach
of fiduciary duty against KeySpan and its directors.
The complaint, which was filed in the New York State Supreme Court for the
County of Kings, related to the execution of the Merger Agreement with
National Grid plc and alleged that the merger consideration which KeySpan's
stockholders would receive in connection with the proposed merger transaction
was inadequate and unfair because the transaction value of $42.00 for each
share of KeySpan's common stock outstanding did not provide its stockholders
with a meaningful premium over the market price of the common stock.
In June 2006, the parties agreed in principle to settle the case, the terms
of which provide for, among other things, the inclusion of additional
disclosures in our 2006 Annual Meeting Proxy Statement concerning the
background and principle events leading to execution of the Merger Agreement,
as well as the payment of plaintiff's counsel fees of up to $350,000
following closing of the transaction.
In October 2006, definitive settlement documents were executed by the parties
and submitted to the Court.
In January 2007, the Court issued an order preliminarily approving the
settlement, authorizing the parties to notify KeySpan shareholders of the
settlement. Mailing of the notices began on Feb. 6, 2007.
On June 28, 2007, a written Decision was issued and a Final Judgment
approving the settlement, awarding the requested attorney's fees of $350,000
and dismissing the action with prejudice. Payment of the attorney's fees in
the amount of $350,000 by National Grid plc is contingent on the closing of
the Merger.
KeySpan Corp. -- http://www.keyspanenergy.com-- through its subsidiaries,
operates in the gas distribution, electric services, energy services and
energy investments segments. It operates six utilities that distribute
natural gas to approximately 2.6 million customers in New York City, Long
Island, Massachusetts and New Hampshire.
L G SOURCING: Recalls Outdoor Lounge Chairs Posing Fall Hazard
--------------------------------------------------------------
L G Sourcing, Inc., of North Wilkesboro, North Carolina, in cooperation with
the U.S. Consumer Product Safety Commission, is recalling about 6,000 Garden
Treasures Cloud 9 Beyond Chairs.
The company said the chair can break when in the reclined position, posing a
fall hazard to consumers. L G Sourcing, Inc. has received seven reports of
the chairs breaking when in the reclined position, resulting in minor
injuries such as bruising to the back, hips, shoulders, arms and a torn
ligament.
This recall involves the Garden Treasures Cloud 9 Beyond outdoor lounge
chairs. The chairs are tan in color, have a light steel frame, cloth seat, a
pillow at the headrest and an adjustable sun visor.
These recalled outdoor lounge chairs were manufactured by Taizhou Yongjiang
Arts and Crafts Collective Ltd., of China and are being sold at Lowe's retail
outlet stores nationwide from December 2006 through April 2007 for about $60.
Picture of recalled outdoor lounge chairs:
http://www.cpsc.gov/cpscpub/prerel/prhtml07/07266.jpg
Consumers are advised to stop using the chairs immediately and return them to
any Lowe's retail outlet to receive a full refund.
For additional information, contact L G Sourcing, Inc. toll-free at (866) 493-
6560 anytime, or visit http://www.lowes.com
LOEWS CORP: Updates on Pending Multi-Plaintiff Lawsuits
-------------------------------------------------------
Lorillard Inc., a wholly owned subsidiary of Loews Corp., is a defendant in
10 pending cases. Loews (Company) is a defendant in two of these cases.
In most of the pending cases, plaintiffs seek class certification on behalf
of groups of cigarette smokers, or the estates of deceased cigarette smokers,
who reside in the state in which the case was filed.
One of the cases in which Lorillard is a defendant, “Schwab v. Philip Morris
USA, Inc., et al.,” is a purported national class action on behalf of
purchasers of “light” cigarettes in which plaintiffs’ claims are based on
defendants’ alleged Racketeering Influenced and Corrupt Organizations Act
violations. Neither Lorillard nor the Company are defendants in
approximately 30 additional class actions in which plaintiffs assert claims
on behalf of smokers or purchasers of “light” cigarettes.
Cigarette manufacturers, including Lorillard, have defeated motions for class
certification in a total of 35 cases, 13 of which were in state court and 22
of which were in federal court. Motions for class certification have also
been ruled upon in some of the “lights” cases or in other class actions to
which Lorillard was not a party. In some of these cases, courts have denied
class certification to the plaintiffs, while classes have been certified in
other matters.
The Engle Case
During 2006, the Florida Supreme Court issued rulings in the case of “Engle
v. R.J. Reynolds Tobacco Co., et al.” (filed in the Circuit Court, Miami-Dade
County, Florida on May 5, 1994), that affirmed the 2003 holding of an
intermediate appellate court vacating the $145.0 billion punitive damages
award, including approximately $16.3 billion against Lorillard.
Prior to trial, Engle was certified as a class action on behalf of Florida
residents, and survivors of Florida residents, who were injured or died from
medical conditions allegedly caused by addiction to nicotine in cigarettes.
The Florida Supreme Court determined that the case could not proceed further
as a class action and ordered that the class is to be decertified.
Although the Florida Supreme Court’s 2006 ruling ordered class
decertification, it also permits members of the former class to file
individual suits, including claims for punitive damages, within a one year
period that is scheduled to expire during January of 2008.
The Florida Supreme Court further held that these individual plaintiffs are
entitled to rely on some of the jury’s findings on a number of issues in
favor of the plaintiffs in the first phase of the Engle trial. These
include, among other things:
-- that smoking cigarettes causes a number of
diseases;
-- that cigarettes are addictive or dependence-
producing; and
-- that the defendants, including Lorillard, were
negligent, breached express and implied
warranties, placed cigarettes on the market that
were defective and unreasonably dangerous, and
concealed or conspired to conceal the risks of
smoking.
Notice of the Florida Supreme Court’s 2006 ruling has been published to the
former class members. Since the Florida Supreme Court issued its 2006
decision, cigarette manufacturers are defendants in 25 cases in which
plaintiffs contend that they are members of the Engle class and that they
intend to rely upon the Engle jury’s Phase I verdict.
Claims for 76 smokers are asserted in these 25 cases. Lorillard is a
defendant in 18 of these suits, which involve the claims of 69 smokers. It
also is possible that plaintiffs in some of the cases that were on file in
Florida at the time the 2006 decision was issued will attempt to rely upon
the Supreme Court’s decision as support for their claims.
In addition, several individuals have filed motions to intervene in the
underlying Engle case in order to assert claims for damages and to share in
the funds paid as a result of an agreement, discussed below, that certain of
the Engle defendants reached with the class during 2001.
It is not possible to estimate the number or ultimate outcomes of lawsuits
that could be filed as a result of the Florida Supreme Court’s 2006 ruling.
During July of 2007, certain cigarette manufacturers, including Lorillard,
moved for the creation of a multi-district proceeding for pretrial
coordination of cases that are pending in federal courts.
The Florida Supreme Court’s 2006 decision also reinstated verdicts that had
awarded actual damages to two of the three individuals whose claims were
heard during the second phase of the Engle trial. These awards totaled
approximately $2.8 million to one smoker and $4.0 million to the second, and
bear interest at the rate of 10.0% per year. Lorillard’s share of either of
these verdicts, if any, has not been determined.
On May 21, 2007, defendants petitioned the U.S. Supreme Court to review the
Florida Supreme Court’s holdings that permit members of the Engle class to
rely upon the jury’s first-phase verdict. The U.S. Supreme Court has not
announced whether it will grant review of defendants’ petition.
Florida enacted legislation that limits the amount of an appellate bond
required to be posted in order to stay execution of a judgment for punitive
damages in a certified class action.
While Lorillard believes this legislation is valid and that any challenges to
the possible application or constitutionality of this legislation would fail,
Lorillard entered into an agreement with the plaintiffs during May of 2001 in
which it contributed $200.0 million to a fund held for the benefit of the
Engle plaintiffs.
Two other defendants executed agreements with the plaintiffs that were
similar to Lorillard’s. As a result, the class agreed to a stay of execution
with respect to Lorillard and the two other defendants on its punitive
damages judgment until appellate review is completed, including any review by
the U.S. Supreme Court.
The Engle Agreement provides that in the event that Lorillard, Inc.’s balance
sheet net worth falls below $921.2 million (as determined in accordance with
generally accepted accounting principles in effect as of July 14, 2000), the
stay granted in favor of Lorillard in the Engle Agreement would terminate and
the class would be free to challenge the Florida legislation.
As of June 30, 2007, Lorillard, Inc. had a balance sheet net worth of
approximately $1.3 billion. In addition, the Engle Agreement requires
Lorillard to obtain the written consent of class counsel or the court prior
to selling any trademark of or formula comprising a cigarette brand having a
U.S. market share of 0.5% or more during the preceding calendar year.
The Engle Agreement also requires Lorillard to obtain the written consent of
the Engle class counsel or the court to license to a third party the right to
manufacture or sell such a cigarette brand unless the cigarettes to be
manufactured under the license will be sold by Lorillard.
The Scott Case
Another class action pending against Lorillard is “Scott v. The American
Tobacco Company, et al.” filed in District Court, Orleans Parish, Louisiana
on May 24, 1996.
During 1997, the court certified a class composed of certain cigarette
smokers resident in the State of Louisiana who desire to participate in
medical monitoring or smoking cessation programs and who began smoking prior
to September 1, 1988, or who began smoking prior to May 24, 1996 and allege
that defendants undermined compliance with the warnings on cigarette packages.
Trial in Scott was heard in two phases. While the jury in its July 2003 Phase
I verdict rejected medical monitoring, the primary relief requested by
plaintiffs, it returned sufficient findings in favor of the class to proceed
to a Phase II trial on plaintiffs’ request for a state-wide smoking cessation
program.
During May of 2004, the jury returned its verdict in the trial’s second phase
and awarded approximately $591.0 million to fund cessation programs for
Louisiana smokers. The court subsequently awarded prejudgment interest.
During February of 2007, the Louisiana Court of Appeal issued a ruling that,
among other things:
-- reduced the amount of the award by approximately
$312.0 million;
-- struck the award of prejudgment interest, which
totaled approximately $440.0 million as of
December 31, 2006; and
-- ruled that the only class members who are eligible
to participate in the smoking cessation program
are those who began smoking by September 1, 1988,
and whose claims accrued by September 1, 1988.
The Louisiana Court of Appeal has returned the case to the trial court, for
further proceedings. Lorillard’s share of any judgment has not been
determined. Both plaintiffs and defendants have petitioned the Louisiana
Supreme Court to review the case.
The parties filed a stipulation in the trial court agreeing that an article
of Louisiana law required that the amount of the bond for the appeal be set
at $50.0 million for all defendants collectively.
The parties further agreed that the plaintiffs have full reservations of
rights to contest in the trial court the sufficiency of the bond on any
grounds. The trial court entered an order setting the amount of the bond at
$50.0 million for all defendants. Defendants collectively posted a surety
bond in that amount, of which Lorillard secured 25%, or $12.5 million.
While Lorillard believes the limitation on the appeal bond amount is valid as
required by Louisiana law, in the event of a successful challenge the amount
of the appeal bond could be set as high as 150% of the judgment and judicial
interest combined. If such an event occurred, Lorillard’s share of the appeal
bond has not been determined.
Other Class Actions
Two additional cases are pending against Lorillard in which motions for class
certification were granted. In one of them, “Brown v. The American Tobacco
Company, Inc., et al.” (filed in Superior Court, San Diego County, California
on June 10, 1997),” a California court granted defendants’ motion to
decertify the class.
The class decertification order has been affirmed on appeal, but the
California Supreme Court has agreed to hear the case.
The class originally certified in Brown was composed of residents of
California who smoked at least one of defendants’ cigarettes between June 10,
1993 and April 23, 2001 and who were exposed to defendants’ marketing and
advertising activities in California.
In the second case, “Daniels v. Philip Morris, Incorporated, et al. (filed in
Superior Court, San Diego County, California on August 2, 1998),” the court
granted defendants’ motion for summary judgment during 2002 and dismissed the
case. The California Court of Appeal affirmed the dismissal during 2004.
During June of 2007, the California Supreme Court heard plaintiffs’ appeal.
It subsequently affirmed a lower court’s dismissal of the class action (Class
Action Reporter, Aug. 3, 2007).
In its ruling, the State Supreme Court stated that the free speech guarantee
of the First Amendment applies: "Defendants' cigarette advertising concerns
lawful activity because it is addressed to adults who can legally purchase
and use cigarettes ... ".
Prior to granting defendants’ motion for summary judgment, the court had
certified a class composed of California residents who, while minors, smoked
at least one cigarette between April of 1994 and December 31, 1999 and were
exposed to defendants’ marketing and advertising activities in California. It
is possible that either or both of these class certification rulings could be
reinstated as a result of the pending appeals.
Other cigarette manufacturers are defendants in approximately 30 cases in
which plaintiffs’ claims are based on the allegedly fraudulent marketing
of “lights” or “ultra-lights” cigarettes. Among those “lights” class actions
in which neither the Company nor Lorillard are defendants is the case
of “Price v. Philip Morris USA filed in the Circuit Court, Madison County,
Illinois, on February 10, 2000.
During March of 2003, the court returned a verdict in favor of the class and
awarded it $7.1 billion in actual damages. The court also awarded $3.0
billion in punitive damages to the State of Illinois, which was not a party
to the suit, and awarded plaintiffs’ counsel approximately $1.8 billion in
fees and costs.
During December of 2005, the Illinois Supreme Court vacated the damages
awards, decertified the class, and ordered that the case be dismissed. The
U.S. Supreme Court declined to review the case, and the Illinois trial court
dismissed Price during December of 2006.
During January of 2007, plaintiffs sought an order vacating the dismissal.
The Illinois Supreme Court is considering whether the trial court is
permitted to address plaintiffs’ motion to reinstate the case. Price is the
only “lights” class action to have been tried, although classes have been
certified in some of the other pending matters.
The Schwab case
Lorillard is a defendant in one “lights” class action, “Schwab v. Philip
Morris USA, Inc., et al. filed in U.S. District Court, Eastern District, New
York on May 11, 2004. The Company is not a party to this case.
Plaintiffs in Schwab base their claims on defendants’ alleged violations of
the RICO statute in the manufacture, marketing and sale of “lights”
cigarettes. Plaintiffs have estimated damages to the class in the hundreds of
billions of dollars. Any damages awarded to the plaintiffs based on
defendants’ violation of the RICO statute would be trebled.
During September of 2006, the court granted plaintiffs’ motion for class
certification and certified a nationwide class action on behalf of purchasers
of “light” cigarettes. During July of 2007, the Second Circuit Court of
Appeals heard defendants’ appeal of the class certification ruling. The court
of appeals has prohibited activity before the trial court until the appeal is
concluded.
Loews Corp. is a holding company. Its subsidiaries are engaged in the
following lines of business: commercial property and casualty insurance, CNA
Financial Corp.; the production and sale of cigarettes, Lorillard, Inc.,; the
operation of interstate natural gas transmission pipeline systems, Boardwalk
Pipeline Partners, LP; the operation of offshore oil and gas drilling rigs,
Diamond Offshore Drilling, Inc.; the operation of hotels, Loews Hotels
Holding Corp. and the distribution and sale of watches and clock, Bulova
Corp.
LOEWS CORP: No Hearings Yet for Tobacco-Related Antitrust Cases
----------------------------------------------------------------
Hearings in tobacco-related indirect purchaser antitrust cases that names
Lorillard Inc., a wholly owned subsidiary of Loews Corp. (Company), as
defendants have not been held yet, according to the company’s Aug. 1 form 10-
Q filing for the quarter ended June 30, 2007.
Approximately 30 antitrust suits were filed on behalf of putative classes of
consumers in various state courts against Lorillard and its major
competitors. The suits all alleged that the defendants entered into
agreements to fix the wholesale prices of cigarettes in violation of state
antitrust laws which permit indirect purchasers, such as retailers and
consumers, to sue under price fixing or consumer fraud statutes.
More than 20 states permit such suits. Lorillard was a defendant in all but
one of these indirect purchaser cases. The Company was also named as a
defendant in most of these indirect purchaser cases, but was voluntarily
dismissed without prejudice from all of them.
Three indirect purchaser suits, in New York, Florida and Michigan, were
dismissed by courts in their entirety and the plaintiffs withdrew their
appeals. The actions in all other states except for New Mexico and Kansas,
have been voluntarily dismissed.
In the Kansas case, the District Court of Seward County certified a class of
Kansas indirect purchasers in 2002. The parties are in the process of
litigating certain privilege issues. On July 14, 2006, the Court issued an
order confirming that fact discovery is closed, with the exception of
privilege issues that the Court determines, based on a Special Master’s
report, justify further limited fact discovery. Expert discovery, as
necessary, will take place later this year. No date has as yet been set by
the Court for dispositive motions and trial, according to the regulatory
filing.
A decision granting class certification in New Mexico was affirmed by the New
Mexico Court of Appeals on February 8, 2005. As ordered by the Court, class
notice was sent out on October 30, 2005. The New Mexico plaintiffs were
permitted to rely on discovery produced in the Kansas case. On June 30, 2006,
the New Mexico Court granted summary judgment to all defendants, and the suit
was dismissed. An appeal was filed by the plaintiffs on August 14, 2006, and
has not yet been heard.
Loews Corp. is a holding company. Its subsidiaries are engaged in the
following lines of business: commercial property and casualty insurance, CNA
Financial Corp.; the production and sale of cigarettes, Lorillard, Inc.,; the
operation of interstate natural gas transmission pipeline systems, Boardwalk
Pipeline Partners, LP; the operation of offshore oil and gas drilling rigs,
Diamond Offshore Drilling, Inc.; the operation of hotels, Loews Hotels
Holding Corp. and the distribution and sale of watches and clock, Bulova
Corp.
MATTEL INC: Unit Sued in N.Y. Over Recalled Character Toys
----------------------------------------------------------
Mattel Inc. (MAT) and its Fisher-Price unit are facing a class action filed
in the U.S. District Court in Manhattan in connection with its recall earlier
this month of nearly 1 million Chinese-made toys that are believed to be
contaminated with lead paint, CNNMoney.com reports.
Named plaintiff Farrah Shoukry is a Miami-Dade County, Fla., resident who
purchased a recalled Dora the Explorer toy at a Target Corp. (TGT) store in
Miami in June. She alleges the El Segundo, Calif., company was reckless and
negligent in allowing lead-tainted toys to reach the market and claims
Mattel's voluntary recall is inadequate to reimburse purchasers of the
potentially contaminated toys.
Earlier, Fisher-Price of East Aurora, New York, in cooperation with the U.S.
Consumer Product Safety Commission, recalled about 967,000 units of Sesame
Street, Dora the Explorer, and other children’s toys (Class Action Reporter,
Aug 3, 2007).
The company said the surface paints on the toys could contain excessive
levels of lead. Lead is toxic if ingested by young children and can cause
adverse health effects. No injuries have been reported.
The recalled involves various figures and toys that were manufactured between
April 19, 2007 and July 6, 2007 and were sold alone or as part of sets. The
toys may have a date code between 109-7LF and 187-7LF marked on the product
or packaging.
These recalled licensed character toys were manufactured in China and are
being sold at retail stores nationwide from May 2007 through August 2007 for
between $5 and $40.
OCE ENERGY: Enogex Units File Fact Findings in Price I
-------------------------------------------------------
Two subsidiaries of Enogex Partners LP and the coordinated defendants
in “Will Price, et al. v. El Paso Natural Gas Co., et al. (Price I),” filed
their proposed findings of fact and conclusions of law regarding conflict of
law issues on class certification.
On September 24, 1999, various subsidiaries of OCE Energy Corp. were served
with a class action petition filed in the District Court of Stevens County,
Kansas by Quinque Operating Company and other named plaintiffs alleging the
mismeasurement of natural gas on non-federal lands.
On April 10, 2003, the court entered an order denying class certification.
On May 12, 2003, the plaintiffs, now Will Price, Stixon Petroleum, Inc.,
Thomas F. Boles and the Cooper Clark Foundation, on behalf of themselves and
other royalty interest owners, filed a motion seeking to file an amended
class action petition, and the court granted the motion on July 28, 2003.
In its amended petition, referred to as the Fourth Amended Petition, OG&E and
Enogex Inc. were omitted from the case but two of Enogex’s subsidiaries
remained as defendants.
The plaintiffs’ Fourth Amended Petition seeks class certification and alleges
that approximately 60 defendants, including two of Enogex’s subsidiaries,
have improperly measured the volume of natural gas.
The Fourth Amended Petition asserts theories of civil conspiracy, aiding and
abetting, accounting and unjust enrichment. In their briefing on class
certification, the plaintiffs seek to also allege a claim for conversion. The
plaintiffs seek unspecified actual damages, attorneys’ fees, costs and pre-
judgment and post-judgment interest. The plaintiffs also reserved the right
to seek punitive damages.
Discovery was conducted on the class certification issues, and the parties
fully briefed these same issues. A hearing on class certification issues was
held April 1, 2005.
In May 2006, the court heard oral argument on a motion to intervene filed by
Colorado Consumers Legal Foundation, which is claiming entitlement to
participate in the putative class action. The court has not yet ruled on the
motion to intervene.
On July 2, 2007, the court ordered the plaintiffs and defendants to file
proposed findings of facts and conclusions of law on class certification by
July 31, 2007.
On July 31, 2007, the two subsidiaries of Enogex filed their proposed
findings of fact and conclusions of law regarding conflict of law issues and
the coordinated defendants filed their proposed findings of facts and
conclusions of law on class certification.
OCE ENERGY: Enogex Units File Fact Findings in Price II
-------------------------------------------------------
Two subsidiaries of Enogex Partners LP and the coordinated defendants
in “Will Price, et al. v. El Paso Natural Gas Co., et al. (Price II)” filed
their proposed findings of fact and conclusions of law regarding conflict of
law issues on class certification.
On May 12, 2003, the plaintiffs (same as those in Price I) filed a new class
action petition in the District Court of Stevens County, Kansas naming the
same defendants and asserting substantially identical legal and/or equitable
theories as in the amended petition of the Price I case.
The plaintiffs allege that the defendants mismeasured the British thermal
unit content of natural gas obtained from or measured for the plaintiffs. In
their briefing on class certification, the plaintiffs seek to also allege a
claim for conversion. The plaintiffs seek unspecified actual damages,
attorneys’ fees, costs and pre-judgment and post-judgment interest. The
plaintiffs also reserved the right to seek punitive damages.
Discovery was conducted on the class certification issues, and the parties
fully briefed these same issues. A hearing on class certification issues was
held April 1, 2005.
In May 2006, the court heard oral argument on a motion to intervene filed by
Colorado Consumers Legal Foundation, which is claiming entitlement to
participate in the putative class action. The court has not yet ruled on the
motion to intervene.
On July 2, 2007, the court ordered the plaintiffs and defendants to file
proposed findings of facts and conclusions of law on class certification by
July 31, 2007.
On July 31, 2007, the two subsidiaries of Enogex filed their proposed
findings of fact and conclusions of law regarding conflict of law issues and
the coordinated defendants filed their proposed findings of facts and
conclusions of law on class certification.
OLD REPUBLIC: Continues to Face Several Title Insurance Lawsuits
----------------------------------------------------------------
Old Republic National Title Insurance Co. (ORNTIC), a principal title
insurance subsidiary of Old Republic International Corp., continues to face
class actions over title insurance in Connecticut, New Jersey and Ohio, and
Pennsylvania.
The company faces purported class action in state courts in Connecticut,
Florida, New Jersey, Pennsylvania, and Ohio. In general, plaintiffs allege
that, pursuant to rate schedules filed by ORNTIC or by state rating bureaus
with the state insurance regulators, ORNTIC was required to, but failed to
give consumers reissue credits on the premiums charged for title insurance
covering mortgage refinancing transactions.
Substantially similar lawsuits have been filed against other unaffiliated
title insurance companies in these and other states as well. The actions
seek damages and declaratory and injunctive relief.
The class actions in Florida were recently settled by ORNTIC for less than
$0.1 million, exclusive of attorneys’ fees and costs.
ORNTIC intends to defend vigorously against the actions in the other states
as well but, at this stage in the litigation, the Company cannot estimate the
ultimate costs it may incur as the actions proceed to their conclusions.
The company reported no development in the case at its Aug. 3, 2007 Form 10-Q
Filing with the U.S. Securities and Exchange Commission for the quarterly
period ended June 30, 2007.
Old Republic International Corp. -- http://www.oldrepublic.com/-- is an
insurance holding company. The Company is engaged in the single business of
insurance underwriting. It conducts its business through a number of
regulated insurance company subsidiaries organized into three major segments:
General (property and liability), Mortgage Guaranty and Title insurance
segments.
PENNSYLVANIA: School District Accused of Racial Discrimination
--------------------------------------------------------------
A class-action complaint filed in the U.S. District Court for the Eastern
District of Pennsylvania accuses the Lower Merion School District of failing
to provide disabled black students with adequate education.
Plaintiffs file this action to appeal a decision of the Appeals Panel issued
pursuant to the Individuals with Disabilities Education Act (IDEA), 20 U.S.C.
Sections 1400 et. seq. (0997), that allegedly failed to address the Lower
Merion School District's violation of the IDEA's Child Find provision by:
(a) substituting below grade level substandard and modified
classes for the regular curriculum and,
(b) failing to provide appropriate education in the least
restrictive environment including individualized,
specially designed instruction when she was identified
as a student with a disability.
Under the IDEA, students with disabilities are required to receive specially
designed instruction, at no cost to their parents, to meet their unique
learning needs. "Specially designed instruction" means instruction whose
content, methodology or delivery is designed to address the unique needs that
arise from the child's disability and to ensure the child's access to the
general curriculum so that the child can meet the educational standards of
the public agency.
Plaintiffs assert that LMSD intentionally segregates African American
students in classes that are taught below grade level while depriving them of
grade-level subject matter and materials that are provided to their Caucasian
peers at all educational levels.
Plaintiffs seek to remedy the alleged wide-spread violations of the Equal
Protection and Due Process Clauses of the 14th Amendment of the United States
Constitution, the IDEA, the Americans with Disabilities Act (ADA) 42 U.S.C.
Section 12132 et seq., Section 504 of the Rehabilitation Act of 1973, 29
U.S.C. Section 794 Title VI of the Civil Rights Act of 1964, Section 1983 of
the Civil Rights Act of 18971 (A Section 1983), 42 U.S.C. 1983, and
Pennsylvania education law which require the Lower Meridian School District
to:
(a) identify and evaluate children at the request of the
parents or when the District's staff suspects that the
child is a child with a disability;
(b) provide each student with specifically designed
instruction and related services that are reasonably
calculated to confer meaningful educational benefits;
(c) educate children with disabilities, to the maximum
extent appropriate, with children who do not have
disabilities; and
(d) not discriminate against students or their parents on
the basis of race or disability.
Plaintiff brings this action, pursuant to Fed.R.Civ.P. 23(a) on behalf of all
African American students in the Lower Merion School District who have been
denied access to the general education curriculum and the specially designed
instruction to meet their unique learning needs and provided an educational
program separate and inferior to that provided their Caucasian classmates.
Plaintiffs seek compensatory damages.
The suit is "Amber Blunt et al. v. Lower Meridion School District et al. Case
No. 07 3100," filed in the U.S. District Court for the Eastern District of
Pennsylvania.
Representing plaintiffs are:
Barbara E. Ransom, Esq.
Judith A. Gran, Esq.
Public Interest Law Center of Philadelphia
125 South, 9th Street, Suite 700
Philadelphia, PA 19107
Phone: (215) 627-7100
Fax: (215) 627-3183
RC2 CORP: Couple Files Suit Over Lead-Tainted Thomas Trains
-----------------------------------------------------------
RC2 Corp. and two related companies -- Racing Champions ERTL Corp. and
Learning Curve Brands Inc. –- are facing a lawsuit alleging that the
companies' Thomas & Friends wooden railway toys exposed children to toxic
lead paint, the Chicago Tribune reports.
In June, the companies recalled about 1.5 million of the popular wooden
railway toys. But according to Ryan and Claudine Kreiner and Patrick and
Caryn Hudspeth -- the Indiana couples who filed the suit -- the recall came
too late.
The toys had been on the market since 2005 and "defendants knew, or should
have known, that the toys were defective and presented a serious risk to the
health and safety of children," the lawsuit said.
The lawsuit alleged that the toys were produced in China and that RC2 failed
to adequately screen and test the products for lead.
The plaintiffs hope to bring the lawsuit as a class action on behalf of other
parents who bought the toys. They are seeking unspecified damages in excess
of $5 million.
The plaintiffs also want the defendants to pay for an ongoing program of
medical monitoring to see whether children who've used the toys become ill.
According to Chicago Tribune, RC2 officials could not be reached for comment.
But in June, company officials said they had identified the manufacturing
plant that made the toys and had addressed the issue.
Company officials said the recall in June affected about 4 percent of its
wooden railway toys sold in the U.S. and that they had received no reports of
anyone being hurt or becoming ill.
Last month, RC2 Corp. was hit with a separate federal lawsuit seeking a court
order that would block it -- at least temporarily -- from selling any metal
trains that consumers had alleged contained lead.
SCE&G: Plaintiffs in “Collins” File Motion to Dismiss Lawsuit
-------------------------------------------------------------
Plaintiffs’ counsel in, “Collins v. Duke Energy Corp., Progress Energy
Services Company, and South Carolina Electric & Gas Company” has filed a
stipulation to dismiss the suit without prejudice.
In August 2003, South Carolina Electric & Gas Company (SCE&GC) was served as
a co-defendant in a purported class action, “Collins v. Duke Energy Corp.,
Progress Energy Services Company, and South Carolina Electric & Gas Company,”
in South Carolina's Circuit Court of Common Pleas for the Fifth Judicial
Circuit.
The plaintiffs subsequently dismissed defendants Duke Energy and Progress
Energy and proceeded against SCE&G only. The plaintiffs sought damages for
the alleged improper use of electric transmission and distribution easements
but did not assert a dollar amount for their claims.
Specifically, the plaintiffs alleged that the licensing of attachments on
electric utility poles, towers and other facilities to nonutility third
parties or telecommunication companies for other than the electric utility’s
internal use along the electric transmission and distribution line rights-of-
way constituted a trespass.
On July 20, 2007, Plaintiffs’ counsel filed a Stipulation of Dismissal
Without Prejudice with the Lexington County Clerk of Court’s Office. This
case can be re-filed.
SCE&G: Circuit Court Limits Class in S.C. Rights-of-Way Lawsuit
---------------------------------------------------------------
The Ninth Judicial Circuit issued a ruling that limits the plaintiff class in
a rights-of-way lawsuit filed against South Carolina Electric & Gas Company
and SCANA Corp. to owners of easements situated in Charleston County, South
Carolina.
In May 2004, SCANA and SCE&G were served with a purported class action filed
by Douglas E. Gressette, individually and on behalf of other persons
similarly situated against the companies. The case was filed in South
Carolina's Circuit Court of Common Pleas for the Ninth Judicial Circuit.
The plaintiff alleges that SCANA and SCE&G made improper use of certain
easements and rights-of-way by allowing fiber optic communication lines
and/or wireless communication equipment to transmit communications other than
SCANA’s and SCE&G’s electricity-related internal communications.
The plaintiff asserted causes of action for unjust enrichment, trespass,
injunction and declaratory judgment. The plaintiff did not assert a specific
dollar amount for the claims. SCANA and SCE&G believe their actions are
consistent with governing law and the applicable documents granting easements
and rights-of-way. The Circuit Court granted SCANA’s and SCE&G’s motion to
dismiss and issued an order dismissing the case in June 2005.
The plaintiff appealed to the South Carolina Supreme Court. The Supreme Court
overruled the Circuit Court in October 2006 and returned the case to the
Circuit Court for further consideration.
In July 2007, the Circuit Court issued a ruling that limits the plaintiff’s
purported class to owners of easements situated in Charleston County, South
Carolina.
The plaintiff has appealed this ruling to the South Carolina Court of
Appeals. It is anticipated that this case may not go to trial before 2008.
SOLUTIA INC: 2nd Circuit Hears Appeal on "Dickerson" Dismissal
--------------------------------------------------------------
The U.S. Court of Appeals for the Second Circuit heard arguments on an appeal
against the dismissal of the purported class action, "Dickerson v. Feldman,"
which names Solutia, Inc.'s former officers and employees as defendants.
On Oct. 7, 2004, a purported class action, "Dickerson v. Feldman, et al." was
filed in the U.S. District Court for the Southern District of New York
against a number of defendants, including former officers and employees of
Solutia Inc. and Solutia's Employee Benefits Plans Committee and Pension and
Savings Funds Committee. Solutia was not named as a defendant.
The action alleged breach of fiduciary duty under Employee Retirement Income
Security Act and sought to recover alleged losses to the Solutia Inc. Savings
and Investment Plan (SIP Plan) from Dec. 16, 1998 to the date the action was
filed.
The investment of SIP Plan assets in Solutia's common stock is alleged to
have been imprudent because of the risks and liabilities related to Solutia's
legacy environmental and litigation liabilities and because of the
involvement of its
50/50 joint venture Flexsys, comprising of interests in:
* Flexsys Holding B.V.,
* Flexsys America L.P., and
* Flexsys Rubber Chemicals Ltd.
in alleged collusive sales and marketing activities in the rubber chemicals
market from July 1995 through September 2001.
The action sought monetary payment to the SIP Plan to recover the losses
resulting from the alleged breach of fiduciary duties, as well as injunctive
and other appropriate equitable relief, reasonable attorney's fees and
expenses, costs and interest.
In addition, the plaintiff in this action filed a proof of claim for $269
million against Solutia in the U.S. Bankruptcy Court for the Southern
District of New York.
The plaintiff sought to withdraw the reference of their ERISA claim from the
Bankruptcy Court to the District Court so that the proof of claim and the
class action could be considered together by the District Court. On Feb. 11,
2005, Solutia filed an objection to the motion to withdraw the reference.
On March 11, 2005, the District Court denied without prejudice Dickerson's
motion to withdraw the reference. The Dickerson plaintiffs subsequently
amended their initial complaint to add several current officers and directors
of Solutia as defendants.
On July 5, 2005, the defendants filed motions to dismiss Dickerson's amended
complaint. In early September 2005, Dickerson filed an amended proof of
claim against Solutia increasing Dickerson's claim from $269 million to $290
million, based on his amended complaint.
Dickerson also filed a motion for class certification of his proof of claim.
On March 30, 2006, the District Court granted the defendants' motion to
dismiss on grounds that the Dickerson plaintiffs lacked standing to sue and
that the complaint failed to state a claim on which relief may be granted.
The dismissal of Dickerson's cause of action resulted in dismissal of the
entire purported class action, including claims asserted on behalf of the
unnamed purported class members.
On April 3, 2006, Dickerson filed an appeal of this dismissal with the U.S.
Court of Appeals for the Second Circuit. The parties have fully briefed the
appeal, and oral arguments were heard on May 21, 2007.
The suit is "Dickerson v. Feldman et al., Case No. 1:04-cv-07935-LAP," on
appeal from the U.S. District Court for the Southern District of New York
Under Judge Loretta A. Preska.
Representing plaintiff is:
Ronen Sarraf, Esq.
Sarraf Gentile, LLP
485 Seventh Avenue, New York, NY 10018
Phone: (212) 868-3610
Fax: (212)918-7967
E-mail: ronen@sarrafgentile.com
Representing the Employee Benefits Plan Committee is:
Robert M. Stern, Esq.
O'Melveny & Myers LLP
1625 Eye Street, NW
Washington, DC 20006
Phone: (202) 383-5328
Fax: (202) 383-5396
E-mail: rstern@omm.com
SOLUTIA INC: Current Employee Files Lawsuit Over SIP Plan
----------------------------------------------------------
A new purported class action entitled “Reiff v. Metz et. al.” was filed on
June 25, 2007 in the U.S. District Court, Southern District of New York
against a number of defendants, including former officers and employees of
Solutia Inc. and Solutia's Employee Benefits Plans Committee and Pension and
Savings Funds Committee.
The factual allegations and legal claims in Reiff are virtually identical to
those in “Dickerson v. Feldman,” filed the U.S. District Court for the
Southern District of New York.
However, the purported class representative in Reiff is a current Solutia
employee whereas the purported class representative in Dickerson is not.
The Dickerson action alleged breach of fiduciary duty under ERISA and sought
to recover alleged losses to the Solutia Inc. Savings and Investment Plan
(SIP Plan) during the period December 16, 1998 to the date the action was
filed.
The investment of SIP Plan assets in Solutia's common stock is alleged to
have been imprudent because of the risks and liabilities related to Solutia's
legacy environmental and litigation liabilities and because of Flexsys'
alleged involvement in the matters described above under "Flexsys Antitrust
Litigation."
Defendants have been served with a copy of the Complaint, but have not yet
filed a responsive pleading.
Northern Trust Co. is among the defendants.
The suit is "Reiff v. Metz et al., Case No. 1:07-cv-06011-LAP" filed in the
U.S. District Court, Southern District of New York under Judge Loretta A.
Preska.
Representing the plaintiff is:
Ronen Sarraf, Esq.
Sarraf Gentile, LLP
485 Seventh Avenue
New York, NY 10018
Phone: (212) 868-3610
Fax: (212)918-7967
E-mail: ronen@sarrafgentile.com
TECO ENERGY: Oct. Hearing Set in Fla. Securities Suit Settlement
----------------------------------------------------------------
An Oct. 3, 2007 final hearing is set for a proposed settlement of a
consolidated securities class action filed against TECO Energy, Inc. and
certain of its current and former officers in the U.S. District Court for the
Middle District of Florida.
Purchasers of company securities filed a number of securities class actions
in August, September and October 2004. These suits, which were filed in the
U.S. District Court for the Middle District of Florida, allege disclosure
violations under the U.S. Securities Exchange Act of 1934.
On Feb. 1, 2005, the court entered its order appointing the
"TECO Lead Plaintiff Group," as the lead plaintiff for the class, which is
comprised of:
-- NECA-IBEW Pension Fund (The Decatur Plan),
-- Monroe County Employees Retirement System,
-- John Marder, and
-- Charles Korpak
The law firm of Lerach Coughlin Stoia Geller Rudman & Robbins, LLP, was
appointed as lead counsel by the court as well.
The plaintiffs filed their consolidated class action complaint for securities
fraud on May 3, 2005. The consolidated complaint maintains the same class
period, Oct. 30, 2001 to Feb. 4, 2003, and the same parties as those
contained in the original complaint.
The nature of the claims, which relate to the adequacy of the company's
disclosures and financial reporting, also remains the same.
The defendants filed their motion to dismiss on July 25, 2005.
The plaintiffs have been granted an extension to file their response through
Dec. 31, 2005, since the parties have agreed to mediate the claims in mid-
December 2005, in order to eliminate uncertainty and ongoing expense
associated with the litigation.
In March 2006, the court partially dismissed the consolidated case.
According to Judge James Whittemore's ruling, the plaintiffs relied on
analysts' reports that they alleged revealed the company's fraud.
However those reports, while pessimistic about the company's future, did not
identify any improprieties, the judge wrote.
In addition, the judge pointed out that the plaintiffs did not sufficiently
establish a connection between the specific fraudulent activity alleged and a
drop in stock prices.
Thus in dismissing part of the plaintiff's complaint and the request for
class action, Judge Whittemore wrote, "In sum, plaintiffs have not
sufficiently alleged that defendant's fraud, as opposed to poor market
conditions, was the proximate cause of
TECO's stock price decline."
The judge, however, did not grant the company's motion to dismiss the entire
case. His reason for not granting that motion was because he found that the
plaintiffs did set forth allegations of deception and manipulation that were
sufficient to support a fraud claim.
The plaintiffs filed their further amended complaint to which the company and
the defendants filed their motion to dismiss on Jul. 7, 2006, based on
failure to plead loss causation as raised in the prior motion. Plaintiffs
filed their response to the motion to dismiss on July 21, 2006.
On Oct. 10, 2006, the court granted defendants' motion to dismiss in part,
leaving only one remaining issue dealing with public statements relating to
the status of the contracting plan for the approximately 6,000 Megawatts of
merchant power then under construction in several states outside of Florida.
On Oct. 30, 2006, the plaintiffs filed a Rule 54(b) motion asking the court
to enter a final judgment on the matters that were dismissed by its Oct. 10
order in order to appeal that portion of the order immediately, while
maintaining the balance of the action in the district court. The court
denied the Rule 54(b) motion.
A mediation on the entire suit occurred on Feb. 16, whereby the company
reached an agreement in principle to settle the shareholder securities class
action.
On July 12, 2007, the U.S. District Court entered a preliminary order
approving the settlement of the Securities Class Action and set a date for a
hearing for the final approval of the settlement on Oct. 3, 2007, according
to the company’s Aug. 3, 2007 Form 10-Q Filing with the U.S. Securities and
Exchange Commission for the quarterly period ended June 30, 2007.
The suit is "In Re: TECO Energy, Inc. Securities Litigation,
Case No. 8:04-cv-01948-JDW-EAJ," filed in the U.S. District
Court for the Middle District of Florida under Judge James D.
Whittemore.
Representing the plaintiffs are:
David A. Rosenfeld, Esq.
Samuel H. Rudman, Esq.
William S. Lerach, Esq.
Darren J. Robbins, Esq.
Stephen Richard Astley, Esq.
David D. George, Esq.
Jack Reise, Esq.
Lerach Coughlin Stoia Geller Rudman & Robbins LLP
Phone: 561/750-3077, 619/231-1058 and 631/367-7100
Fax: 561/750-3364 and 631/367-1173
E-mail: sastley@lerachlaw.com
dgeorge@lerachlaw.com
jreise@lerachlaw.com
drosenfeld@lerachlaw.com
Representing the company are:
Diane Knox, Esq.
Richard A. Rosen, Esq.
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas,
New York, NY 10019-6064
Phone: 212/373-3000
Tracy A. Nichols, Esq.
Holland & Knight LLP
701 Brickell Ave., Suite 3000, P.O. Box 015441
Miami, FL 33131-5441
Phone: 305/374-8500
Fax: 305/789-7799
E-mail: tracy.nichols@hklaw.com
- and -
Steven B. Rosenfeld, Esq.
1285 Avenue of the Americas
New York, NY 10019-6064
Phone: 212/373-3000
Fax: 212-757-3990
THOUSAND OAKS: Car Wash Accused of Abusing Undocumented Workers
---------------------------------------------------------------
A class action has been brought against a Thousand Oaks car wash that is
allegedly operating in violation of California labor laws.
The suit alleges that the owners of the Thousand Oaks Hand Wash hired
undocumented workers and subjected them to slavery-like conditions, including
forcing them to work for free for the first month and denying them overtime
pay.
Plaintiffs allege if they stayed long enough to earn the right to be paid,
they received well below minimum wage and they endured constant threats of
deportation.
The suit has been filed by Ventura-based Strauss Law Group and the Quirk Law
Firm, whose client's experience as an employee at the Hand Wash is the basis
of the lawsuit. "It appears that these people were forced to work in
absolutely dismal conditions," said Tony Strauss, owner of Strauss Law Group.
"These claims are the most flagrant, extreme, and systematic violations of
California labor laws that I have witnessed in 30 years of practice."
The suit alleges that Hand Wash, which is located at 2725 Thousand Oaks
Blvd., knowingly employs undocumented workers whose lack of English skills
and fear of immigration services make them easily exploited.
Hand Wash allegedly refuses to pay its employees for up to as much as the
first month, after which employment may be severed without compensation if
Hand Wash is not satisfied with their performance.
The Complaint filed in Ventura County Superior Court, Simi Valley Division
states that the named plaintiff was told that if he did a good job, he would
then begin earning money at $5.00 per hour. This is well below both the
current California minimum wage of $7.50 and the previous minimum wage of
$6.25. The suit goes on to allege that Hand Wash required employees to report
to work at 8:00 AM but they did not get paid until the first cars came in
later in the morning. It also alleges that employees were forced to regularly
work more than 10 hours per day, often times seven days per week, with no
rest or lunch breaks or overtime pay.
The complaint further alleges that, despite the illegality of these terms,
employees are dissuaded from complaining by the constant threat of
deportation. "These workers say that they are told by Hand Wash management
that if they complain about their work environment, they will be deported,"
said Mr. Strauss. "If true, this employer is using fear to thwart the law."
Strauss Law Group is bringing a class action, where one party can litigate
for the benefit of each member of the injured class, on behalf of its
client's fellow undocumented Hand Wash workers. Undocumented workers often
refuse to come forward about labor violations out of concern that they could
be outed and deported, and as a result they are often subjected to harsh
employment conditions.
Due to the threat of deportation for all of the employees who could aid in
the investigation, Strauss Law Group and Quirk Law Firm have retained the
services of immigration attorney Gabriella Navarro-Busch. Ms. Navarro-Busch,
who practices in Ventura, has aided in seeking protection for these
employees.
"It was very brave of my client to come forward about what is, if proven, a
modern-day form of slavery," said Mr. Strauss.
"Regardless of how you feel about undocumented immigrants, we all need to
recognize that human beings should not be treated this way."
For more information, contact:
John Lockhart
Alex Rodriguez
Strauss Law Group,
199 South Figueroa Street, 2nd Floor
Ventura, California 93001
Phone: +1-805-648-5900, ext. 224 or 1-800-600-7111,
ext. 224, or +1-805-648-5900, ext. 236 or 1-
800-600-7111, ext. 236, or 805-641-9992
Fax: 805-641-9993
Website: http://www.strausslawgroup.comor
http://www.venturalitigation.com
New Securities Fraud Cases
COUNTRYWIDE FINANCIAL: Scott+Scott Files Securities Suit in Cal.
----------------------------------------------------------------
Scott+Scott, LLP, filed a class action against Countrywide Financial Corp.
and certain officers and directors in the U.S. District Court for the Central
District of California.
The action is on behalf of Countrywide Financial common stock purchasers
during the period October 24, 2006, through August 9, 2007, inclusive, for
violations of the Securities Exchange Act of 1934.
The complaint alleges that defendants made false and misleading statements
and material omissions regarding the Company's business and operations and
that, as a result, the price of the Company's securities was inflated during
the Class Period, thereby harming investors.
According to the complaint, during the Class Period, defendants made false
and misleading statements regarding the changing quality of the Company's
mortgage loan portfolio. As late as April of 2007, the Company stated that
credit rating agency Moody's upgraded the rating of the Company's banking
segment and announced that its home loans segment was also under review for
possible upgrade.
Then, on June 12, 2007, the Company boasted of its position as the number one
mortgage originator in the United States. These reassuring announcements
served to conceal the alarming growth of loan delinquencies and the
increasing likelihood of impairment charges, with resulting adverse impacts
on the quality of the Company's collateralized debt obligations (CDO's),
earnings and profits.
On July 24, 2007, the Company finally announced the shocking news, of over
$417 million in impairment charges and implementation of a $292.9 million
loan loss provision. On the news, the price of Countrywide Financial stock
tumbled 10.4%, closing at $30.50 per share. Following this, on August 9,
2007, within four days of reassuring statements that purported the
reliability and availability of liquidity to meet short-term needs, the
Company adopted a new risk disclosure, warning of short-term liquidity
issues.
As a result, on that day, the price of Countrywide Financial stock fell
again, losing $1.00 or 3.4%, to close at $27.86 per share, on heavy volume of
over 48.6 million shares.
For more information, contact:
Scott+Scott, LLP
Phone: (800) 404-7770 or (860) 537-5537
E-mail: scottlaw@scott-scott.com
Website: http://www.scott-scott.com
PALL CORP: Lerach Coughlin Files Securities Fraud Suit in N.Y.
--------------------------------------------------------------
Lerach Coughlin Stoia Geller Rudman & Robbins LLP announced that a class
action has been commenced in the U.S. District Court for the Eastern District
of New York on behalf of purchasers of the common stock of Pall Corp.
(NYSE:PLL) between April 20, 2007 and August 2, 2007, inclusive, seeking to
pursue remedies under the Securities Exchange Act of 1934.
The complaint charges Pall and certain of its officers and directors with
violations of the Exchange Act. The Company, together with its subsidiaries,
manufactures and markets filtration, purification, and separation products
and integrated systems solutions worldwide.
According to the complaint, during the Class Period, defendants issued
materially false and misleading statements that misrepresented and failed to
disclose:
(i) that Pall was materially overstating its financial
results by understating its tax liability for taxes.
Pall has publicly reported that it could owe more than
$130 million in taxes, exclusive of interest or
penalties, and that its financial statements for fiscal
years 1999 through 2006 and for each of the fiscal
quarters ended October 31, 2006, January 31, 2007, and
April 30, 2007 "should no longer be relied upon and
that a restatement of some or all of those financial
statements will be required";
(ii) that the Company's reported effective tax rate was
materially inaccurate as the Company was materially
understating its tax liability as it has now admitted;
and
(iii) based on the foregoing, the Company's financial
statements were not prepared in accordance with GAAP
and were, therefore, materially false and misleading.
On July 19, 2007, after the markets closed, Pall announced that the Audit
Committee of its Board of Directors had commenced an inquiry into a possible
material understatement of U.S. income tax payments and of its provision for
income taxes in certain prior periods beginning with fiscal year ended July
31, 1999.
In response to this announcement, the price of Pall common stock declined
from $48.78 per share to $41.11 per share, over 15%, on unusually high
trading volume. Then, on August 2, 2007, Pall announced that its financial
statements for fiscal years 1999 through 2006 and for each of the fiscal
quarters ended October 31, 2006, January 31, 2007, and April 30, 2007 "should
no longer be relied upon and that a restatement of some or all of those
financial statements will be required."
Furthermore, Pall reported that the Company could owe up to $130 million in
back taxes not including interest and penalties. Upon this news, shares of
the Company's stock fell $1.21 per share, or 3%, to close at $39.90 per
share, on heavy trading volume.
Plaintiff seeks to recover damages on behalf of all those who purchased the
behalf of purchasers of the common stock of Pall between April 20, 2007 and
August 2, 2007, inclusive.
For more information, contact:
Samuel H. Rudman
David A. Rosenfeld
Lerach Coughlin Stoia Geller Rudman & Robbins LLP
Phone: 800-449-4900
E-mail: wsl@lerachlaw.com
QIAO XING: The Pomerantz Firm Files Securities Suit in N.Y.
-----------------------------------------------------------
Pomerantz Haudek Block Grossman & Gross LLP filed a class action in the U.S.
District Court Southern District of New York, against Qiao Xing Universal
Telephone, Inc. (Nasdaq:XING) and certain officers, on behalf of purchasers
of the common stock of the Company during the period from June 20, 2004
through July 16, 2007, both dates inclusive.
The complaint alleges violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.
The complaint alleges that during the class period, Qiao Xing portrayed
itself to investors as a company with growing net sales and net income, and
that it reported its financial results in accordance with generally accepted
accounting principles ("GAAP"). However, the true facts, which were not
disclosed to investors, were that the Company's financial results were
materially misstated and were not prepared in accordance with GAAP, and that
the Company's internal controls were materially defective.
Specifically, the complaint alleges that on July 17, 2007, Qiao Xing
disclosed that Qiao Xing Mobile Communication Co., Ltd., ("QXMC"), a
consolidated subsidiary of the Company, misstated revenues for the years
2005, 2004 and 2003. As a result, management decided to restate the Company's
consolidated financial statements, having overstated its reported net income
for the years 2005 and 2004 by 2% and 93%, respectively, and for the year
ended 2003, Qiao Xing understated its reported net loss by 210%. In response
to these announcements, the price of the Company's stock declined
approximately 21%.
Interested parties may move the court no later than October 8, 2007 for lead
plaintiff appointment.
Qiao Xing is one of China's largest manufacturers and distributors of
telecommunication products and has established partnerships with companies in
the United States such as Wal-Mart. The Company primarily manufactures mobile
phone handsets and accessories.
For more information, contact:
Teresa Webb
Pomerantz Haudek Block Grossman & Gross LLP
Phone: (888) 476.6529 or (888) 4.POMLAW
E-mail: tlwebb@pomlaw.com
*********
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collectively face billions of dollars in asbestos-related
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*********
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Copyright 2007. All rights reserved. ISSN 1525-2272.
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