/raid1/www/Hosts/bankrupt/CAR_Public/080314.mbx
C L A S S A C T I O N R E P O R T E R
Friday, March 14, 2008, Vol. 10, No. 53
Headlines
ADOLOR CORP: Penn. Court Mulls Motion to Dismiss Securities Suit
ADVANCE AMERICA: Faces Mo. Lawsuit Over Lending Laws Violations
AMCOR LTD: Visy-Amcor Product Users May Opt-Out of Cartel Suit
CALIFORNIA: Suit Accuses Teacher of Abusing Disabled Children
CHOICEPOINT INC: Reaches Tentative Settlement in Ga. ERISA Case
CHOICEPOINT INC: Reaches $10M Settlement in CA Securities Suit
CHOICEPOINT INC: "Taylor" Matter Still Enjoined From Proceeding
CHOICEPOINT INC: Fla. Court Considers DPPA Suit Settlement
COMMUNITY HEALTH: Appeals Class Certification Order in Ala. Suit
COMMUNITY HEALTH: Ill. Appellate Court Considers Appeal in "Rix"
COMMUNITY HEALTH: Discovery Still Ongoing in "Chronister" Matter
COMPUCREDIT CORP: Continues to Face N.C. Consumer Fraud Lawsuit
CORINTHIAN COLLEGES: Ca. Suit Alleges Unfair Business Practices
DVI INC: Settles "Merrill Lynch" Securities Lawsuit in Penna.
GENERAL REINSURANCE: No Trial Date Set for AIG Securities Suit
GENERAL REINSURANCE: Still Faces Litigation Over ROA Insurance
HIH INSURANCE: Ex-Director Settles Misleading Conduct Claim
IKANOS COMMS: Court Dismisses Securities Lawsuit
MOBILE OPERATORS: Customers' $2.5B Suit in Jerusalem Dismissed
OANDO PLC: May Face Lawsuit Over Adulterated Imported Petrol
OMAHA MEATPACKERS: Face Lawsuits Over Employee Payments
PENNSYLVANIA: Delinquent Tax Communications Suit Settled
RC2 CORP: Sued Over Lead Content in Paint Used on Toys
SUNBEAM PRODUCTS: Heating Pads Catch Fire, Fla. Lawsuit Claims
SUNOPTA INC: Federman Reminds Investors of Mar. 28 Deadline
TOYS R US: Faces N.Y. Lawsuit Over Deceptive Business Practices
U.S. HOUSING DEPT: To Pay Employees $24MM in Settlement of Suit
W.R. GRACE: Plaintiffs Appeal Dismissal of ERISA Suits in Mass.
W.R. GRACE: Faces Mass. Litigation Alleging ERISA Violations
WATCHGUARD TECH: Court Dismisses Suit vs. 2 Private Equity Firms
* Milberg Weiss Tops U.S. Class-Action Ranks, Study Says
New Securities Fraud Cases
ENERNOC INC: Faces Securities Fraud Lawsuit in Massachusetts
MF GLOBAL: Federman & Sherwood Announces Securities Suit Filing
MF GLOBAL: Faces Securities Fraud Lawsuit in S.D. New York
PMI GROUP: Abraham Fruchter Files Securities Fraud Suit in CA
PMI GROUP: Coughlin Stoia Commences Securities Fraud Suit in CA
SOCIETE GENERALE: Cohen Milstein Files NY Securities Fraud Suit
Asbestos Alerts
ASBESTOS LITIGATION: XL Capital Records 1,716 Claims at Dec. 31
ASBESTOS LITIGATION: Watts Water Faces 100 Cases in Miss., N.J.
ASBESTOS LITIGATION: W.R. Grace Still Has Damage, Injury Actions
ASBESTOS LITIGATION: 460 Damage Claims at Dec. Remain v. Grace
ASBESTOS LITIGATION: Personal Injury Cases Pending v. W.R. Grace
ASBESTOS LITIGATION: Grace Records $917M of Coverage at Dec. 31
ASBESTOS LITIGATION: W.R. Grace's Libby Liability Totals $270.8M
ASBESTOS LITIGATION: Grace to Appeal 9th Circuit Ruling in Suit
ASBESTOS LITIGATION: NJDEP Action v. Grace, 2 Ex-Workers Ongoing
ASBESTOS LITIGATION: Supreme Court Favors CNA in Lautenschuetz
ASBESTOS LITIGATION: Transatlantic Records $124M for A&E Claims
ASBESTOS LITIGATION: Union Pacific Cites $265M Liability at Dec.
ASBESTOS LITIGATION: Selective Insurance Records 2,177 Claims
ASBESTOS LITIGATION: Safeco Reserves $227.8M for Claims at Dec.
ASBESTOS LITIGATION: Exposure Suits Pending v. Olin Corporation
ASBESTOS LITIGATION: Suits v. MeadWestvaco Drop to 350 at Dec.
ASBESTOS LITIGATION: Lawsuits Still Pending v. Lockheed Martin
ASBESTOS LITIGATION: 103T Open Claims Pending v. ITT at Dec. 31
ASBESTOS LITIGATION: Illinois Tool, Units Face Welding Lawsuits
ASBESTOS LITIGATION: Injury Lawsuit Ongoing v. California Water
ASBESTOS LITIGATION: Summary Judgment Decision Reversed in Horak
ASBESTOS LITIGATION: Third-Party Actions Pending v. Badger Meter
ASBESTOS LITIGATION: Hercules Incurs $5.7M for Legal Fees in '07
ASBESTOS LITIGATION: Hercules Records $227M Liability at Dec. 31
ASBESTOS LITIGATION: Claims v. Hercules Drop to 25,562 at Dec.
ASBESTOS LITIGATION: Exposure Suits Still Pending v. CenterPoint
ASBESTOS LITIGATION: Chicago Bridge Faces 1,900 Suits at Dec. 31
ASBESTOS LITIGATION: CBS Faces 72,120 Pending Claims at Dec. 31
ASBESTOS LITIGATION: General Motors Corp. Facing Exposure Claims
ASBESTOS LITIGATION: Coca-Cola Suits Involving Aqua-Chem Ongoing
ASBESTOS LITIGATION: La. Court Issues Split Ruling in Glaxo Case
ASBESTOS LITIGATION: 2nd Circuit Reverses Ruling in Rainey Suit
ASBESTOS LITIGATION: Crown Cork Records 79,000 Claims at Dec. 31
ASBESTOS LITIGATION: Appeal on Crown Cork Action Heard in Texas
ASBESTOS LITIGATION: Plaintiffs' Appeals v. Crown Cork Pending
ASBESTOS LITIGATION: Deere Still Subject to Liability Lawsuits
ASBESTOS LITIGATION: Delphi Fin'l. Cites $9M Losses, LAE in '07
ASBESTOS LITIGATION: Cytec Ind. Records $53.9M Liability at Dec.
ASBESTOS LITIGATION: 8,200 Claims Still Pending v. Cytec at Dec.
ASBESTOS LITIGATION: Suit v. CSX Transportation Filed on Jan. 29
ASBESTOS LITIGATION: W.R. Grace to Pay $250M for Montana Cleanup
ASBESTOS LITIGATION: Commission Refers Equitable Case to Iowa AG
ASBESTOS LITIGATION: Gosse Seeks End to Canadian Housing Inquiry
ASBESTOS LITIGATION: Leigh Day Recovers Over GBP170T in Damages
ASBESTOS LITIGATION: U.K. Group Seeks to Widen Drug Eligibility
ASBESTOS LITIGATION: Sen. Baucus Pushes for Libby, Mont. Cleanup
ASBESTOS LITIGATION: Whisnat Lawsuit v. DuPont Ongoing in Texas
ASBESTOS LITIGATION: N.Y. Carpenter to Serve 15 Months in Prison
ASBESTOS LITIGATION: Calif. Couple Gets $20M in Georgia-Pacific
ASBESTOS LITIGATION: Suit v. 42 Firms Filed Last Feb. 1 in W.Va.
ASBESTOS LITIGATION: French Court Upholds EUR75T Fine v. Alstom
ASBESTOS LITIGATION: Ford Lodges Appeal to AUD840T Compensation
ASBESTOS LITIGATION: Aon Corporation Has $71M Liability at Dec.
ASBESTOS LITIGATION: Dalmine Faces 57 Pending Claims at Dec. 31
ASBESTOS LITIGATION: Texas Eastern Faces James Case in La. Court
ASBESTOS LITIGATION: Entergy Units Face 600 Actions w/ 8T Claims
ASBESTOS LITIGATION: Essex Int'l. Still Facing Liability Suits
ASBESTOS LITIGATION: SCC Affiliates Involved in ASARCO Matters
ASBESTOS LITIGATION: Exposure Claims Pending v. Roper Industries
ASBESTOS LITIGATION: ASARCO Seeing $242M to $447M in Liabilities
ASBESTOS ALERT: Appeals Court Favors Butlers in Case v. Domco
*********
ADOLOR CORP: Penn. Court Mulls Motion to Dismiss Securities Suit
----------------------------------------------------------------
The U.S. District Court for the Eastern District of Pennsylvania
has yet to rule on a motion by Adolor Corp. to dismiss a
consolidated securities class action filed against it, its
director and certain officers.
The lawsuit was filed on April 21, 2004, with the U.S. District
Court for the Eastern District of Pennsylvania against the
company, one of its directors and certain of its officers,
seeking unspecified damages on behalf of a putative class of
persons who purchased common stock between Sept. 23, 2003, and
Jan. 14, 2004.
The complaint alleges violations of Section 10(b) and section
20(a) of the U.S. Securities Exchange Act of 1934, in connection
with the announcement of the results of certain studies in the
company's Phase III clinical trials for Entereg(R), which
allegedly had the effect of artificially inflating the price of
the company's common stock.
The suit has been consolidated with three subsequent actions
asserting similar claims under the caption, "In re Adolor
Corporation Securities Litigation, No. 2:04-cv-01728."
On Dec. 29, 2004, the district court issued an order appointing
the Greater Pennsylvania Carpenters' Pension Fund as lead
plaintiff. The appointed lead plaintiff filed a consolidated
amended complaint on Feb. 28, 2005.
The complaint purported to extend the class period, so as to
bring claims on behalf of a putative class of Adolor
shareholders who purchased stock between Sept. 23, 2003, and
Dec. 22, 2004.
The complaint also adds as defendants the board of directors,
asserting claims against them and the other defendants for
violation of Section 11 and Section 15 of the Securities Act of
1933 in connection with the company's public offering of stock
in November 2003.
The company and its management and director defendants moved to
dismiss the complaint on April 29, 2005. The plaintiffs
responded to the motion to dismiss on June 28, 2005, and the
defendants' reply was filed on Aug. 12, 2005.
Adolor Corp. reported no development in the matter in its
Feb. 29, 2008 form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2007.
The suit is "In re Adolor Corp. Securities Litigation, No. 2:04-
cv-01728," filed with U.S. District Court for the Eastern
District of Pennsylvania
Representing the plaintiffs are:
Ramzi Abadou, Esq. (ramzia@lcsr.com)
Lerach Coughlin Stoia & Robbins LLP
401 B St., Ste. 1700
San Diego CA, 92101
Phone: 619-231-1058
- and -
Marc S. Henzel, Esq. (mhenzel182@aol.com)
Law Offices of Marc S. Henzel
273 Montgomery Ave., Suite 202
Bala Cynwyd PA 19004
Phone: 610-660-8000
Representing the defendants are:
Michael S. Doluisio, Esq.
(michael.doluisio@dechert.com)
Jeffrey G. Weil, Esq.
Dechert, Price & Rhoads
1717 Arch Street, 4000 Bell Atlantic Tower
Philadelphia, PA 19103-2793
Phone: 215-994-2749
Fax: 215-994-2222
- and -
Laurie B. Smilan, Esq. (laurie.smilan@lw.com)
Latham & Watkins LLP
Two Freedom Square
11955 Freedom Drive, Suite 500
Reston VA 20190-5651
Phone: 1-703-456-5220
Fax: 1-703-456-1001
ADVANCE AMERICA: Faces Mo. Lawsuit Over Lending Laws Violations
---------------------------------------------------------------
Advance America and Cash Advance Centers of Missouri are facing
a class-action complaint filed with the U.S. District Court for
the Western District of Missouri for violating a slew of lending
laws, starting with charging 277% interest on a $500 loan,
CourtHouse News Service reports.
Named plaintiffs Patricia Hooper and Josephine Vaughan brings
the action against the defendants:
-- Advance America,
-- Cash Advance Centers of Missouri, Inc., d/b/a Advance
America,
as a result of the defendant's violations of the Missouri
Merchandising Practices Act (Mo.Rev.Stat. 407.010) and the laws
governing payday lenders (Mo.Rev.Stat. 408.500 et seq.).
With regards to the plaintiffs and the class, Advance America
violated Missouri law in each of the following ways:
* Advance America renewed the plaintiffs' loans without
reducing the principal.
* Advance America never evaluated the plaintiffs' ability
to repay their loans.
* Advance America limited the number of renewals that the
plaintiffs could obtain to less than six despite the fact
that Missouri law provides consumer six renewals.
* Advance America charged an interest rate that made
obtaining six legal renewals, in which the principal was
reduced by the minimum required amount of 5%, impossible
without the plaintiffs and the class paying more than 75%
of the original loan amount in interest and fees.
This policy reinforced Advance America's stated policy of
allowing no more than four renewals. This allowed Advance
America to collect far larger sums of money than Missouri law
would allow and encouraged the plaintiffs and class to remain in
loans longer than the legislature intended.
The plaintiffs bring the action on behalf of themselves and all
others similarly situated pursuant to Missouri Revised Statute
407.025.3, Federal Rule of Civil Procedure 23 on behalf of all
Missouri citizens who obtained any payday loan from Advance
America, where Advance America:
A) limited the number of principal reduction renewals to
fewer than six;
B) set the interest rate on the loan at a level that would
not allow six renewals without requiring the customer's
payment of total interest and fees paid by the consumer
to exceed 75% of the original amount borrowed;
C) failed to consider the financial ability of the borrower
to reasonably repay the loan in the time and manner
specified in the loan contract;
D) charged a total amount of accumulated interest and fees
exceeding 75% of the initial loan amount of that loan
for the entire term of that loan and all renewals of
that loan;
E) flipped consumer loans by encouraging the consumer to
"pay off" one loan and immediately borrow back the money
that was paid.
The plaintiffs want the court to rule on:
i. whether the defendant illegally limited the number of
renewals available to the plaintiffs and the class;
ii. whether the defendant illegally renewed the loans of the
plaintiffs and the class by failing to reduce the
principal by at least 5%;
iii. whether the defendant set interest rates at a level that
would not allow the six renewals permitted by law
without causing the total amount of interest and fees
paid on the loan to exceed 75% of the original loan
amount;
iv. whether the defendant failed to evaluate the ability of
the plaintiffs and the class to repay loans in the
manner and time specified;
v. whether the defendant charged over 75% of the original
loan amount in interest and fees;
vi. whether the defendant's practice of renewing loans
without lowering the principal was an unfair practice;
vii. whether the defendant willfully violated Missouri law;
viii. whether the defendant's arbitration clause is
unconscionable and against Missouri public policy;
ix. whether the defendant's arbitration clause serves as a
de facto immunity clause against claims by the
plaintiffs and the class.
The plaintiffs and the class request that the Court enter an
order:
-- maintaining the suit as a class action pursuant to
Missouri Supreme Court Rule 52.08 and Missouri Revised
Statute 407.025.3, and certifying classes;
-- certifying the plaintiffs as class representative and
appointing their counsel as counsel for the class;
-- awarding the plaintiffs and class compensatory damages,
to include any fees and interest illegally charged and
further awarding any damages caused by such payments;
-- awarding the plaintiffs and the class their
consequential and incidental damages;
-- awarding total damages in excess of $25,000;
-- awarding the plaintiffs and class pre-judgment and post-
judgment interest as provided by law;
-- awarding the plaintiffs and class punitive damages as
provided by law;
-- imposing a constructive trust and equitable lien against
all money paid by the class to and wrongfully withheld
by Advance America;
-- awarding the plaintiffs and the class attorneys' fees
and costs as provided by law;
-- entering a preliminary and permanent injunction
prohibiting Advance America from engaging in unfair or
deceptive trade practices including the limiting
renewals to four, the setting of an interest rate that
exceeds the permissible rate, the renewal of loans
without the reduction of principal by at least 5%, the
collection of interest and fees exceeding 75% of the
original loan amount, encouraging and allowing customers
to pay off one loan with the proceeds of another and the
issuing of loans to customers without an evaluation of
their ability to repay the loan in the time and manner
prescribed;
-- entering an order that the defendant abide by the terms
of the spoliation letter;
-- issuing a declaratory judgment that the defendant's
arbitration clause is unconscionable, against Missouri
public policy, and unenforceable against the plaintiffs
and the class; and
-- awarding the plaintiffs and the class such other and
further relief as may be just and proper.
The suit is "Patricia Hooper et al v. Advance America et al.,
Case No. 08-4045-cv-c-NKL," filed with the U.S. District Court
for the Western District of Missouri.
Representing the plaintiffs are:
John Campbell, Esq.
Erich Vieth, Esq.
Simon Passanante, PC
701 Market St., Suite 1150
St. Louis, Missouri 63101
Telephone: (314) 241-2929
Facsimile: (314) 241-2029
Debra K. Lumpkins, Esq.
Gateway Legal Services, Inc.
200 N. Broadway, Ste. 950
St. Louis, MO 63102
Phone: (314)534-0404
Fax: 652-8308
- and -
Noel (Neal) Bisges
Bisges Law Office
529 East High Street
Jefferson City, MO 65101
Phone: (573) 635-6850
AMCOR LTD: Visy-Amcor Product Users May Opt-Out of Cartel Suit
--------------------------------------------------------------
Retailers, manufacturers and transporters who used products by
Amcor Ltd. and Visy Industries while the two companies
maintained a price-fixing cartel will be given the choice to opt
out of a class action lawsuit, Inside Retailing Online reports.
According to the Australian Financial Review, law firm Maurice
Blackburn Cashman received court approval to issue the opt-out
notices.
Inside Retailing recounts that the class action suit was filed
in April 2006 against Amcor, Visy, Amcor Packaging (Australia)
Ltd., and Fibre Containers (Queensland) Pty Ltd., by the firm
and seeks damages for the victims of the cartel conduct that
spanned four years from 2000.
As reported in the Class Action Reporter on Oct. 6, 2006, the
plaintiffs in the lawsuit claim to have been damaged by price
fixing and market sharing in the cardboard box industry between
2000 and 2005. Maurice Blackburn estimated that businesses
incurred damages of between $2 million and $3 million as a
result of anti-competitive practices in the industry.
The class action alleges that customers of Amcor and Visy were
overcharged between 8% and 15% for their cardboard packaging
after the companies allegedly entered into a deal to
artificially inflate prices.
On November 2, 2007, Inside Retailing further recalls, the
Federal Court accepted a plea deal between the Australian
Competition and Consumer Commission and Visy and fined the Visy
Board of Directors and its owner, Richard Pratt, $36 million.
Visy Board executives Harry Debney and Rod Carroll were fined
$1.5 million and $500,000 respectively. The ACCC had earlier
granted Amcor and its former senior executives immunity from
prosecution for blowing the whistle on the cartel and
cooperating with the ACCC's extensive investigation.
CALIFORNIA: Suit Accuses Teacher of Abusing Disabled Children
-------------------------------------------------------------
Benicia High School special education teacher Karla Buckley is
facing a class-action complaint filed with the U.S. District
Court for the Northern District of California accusing her of
abusing disabled children, CourtHouse News Service reports.
The plaintiffs bring the lawsuit on behalf of all children with
disabilities attending Benicia High School who have been denied
their right to full and equal access to, and use of enjoyment
of, the facilities, programs, services and activities of Benicia
High School because of past abusive conduct concerning the
discipline of children with disabilities.
The complaint alleges that the special ed teacher and her aide
tied a disabled student to his wheelchair, and left him "upside
down with his injured foot in the air" for a long time, to
punish the child "and for the amusement of Defendants."
The child's parents claim the teacher and aide subjected their
child, and others, to other "unhealthy, sub-human and
humiliating conditions on several occasions."
The plaintiffs accuse Ms. Buckley of supervising the abuses,
which allegedly occurred from 2004 through 2007. They claim the
school nurse documented the abuse and reported it to Benicia
Police, which "concluded the abuse had occurred, and referred
the case to the Solano County District's Office for criminal
prosecution," but the DA refused to prosecute.
All of the children involved are severely disabled. The parents
claim that Ms. Buckley's aide covered one child's hands with
glue as punishment, and then watched his distress "in
amusement."
The plaintiffs also content that Ms. Buckley or her aide forced
one child to walk after foot surgery "despite knowledge that his
foot was injured and despite explicit instructions from his
doctor that he was not to walk during recovery. Defendant's
actions were motivated by personal animus toward DK for his
disability related behaviors and for personal entertainment."
The parents claim that the school principal and district
superintendent refused to stop the abuses, or negligently
permitted them.
The plaintiffs ask for:
-- an order and judgment enjoining defendants from
violating the Americans with Disability Act; Section 504
of the Rehabilitation Act of 1973; California Civil Code
sections 51, et seq., and California Code Sections 54,
et seq; and California Government Code Section 11135 et
seq.;
-- a declaration that the Benicia Unified School District's
and Solano County Office of Education's policies,
practices or procedures concerning the improper
discipline/behavior management of children with
disabilities denied their right to full and equal access
to, and use and enjoyment of, the facilities, programs,
services and activities of Benecia Unified School
District's and SCOE's policies as required by law;
-- payment of costs incurred;
-- payment of damages according to proof;
-- payment of plaintiffs' reasonable attorney fees and
costs; and
-- payment of punitive damages.
The suit is "D.K. et al. v. Solano County Office of Education et
al.," filed with the U.S. District Court for the Northern
District of California.
Representing the plaintiffs are:
Tamara Loughrey, Esq.
Robert L. Woelfel, Esq.
Loughrey & Woelfel, LLP
31 Panoramic Way, Suite 200
Walnut Creek, CA 94597
CHOICEPOINT INC: Reaches Tentative Settlement in Ga. ERISA Case
---------------------------------------------------------------
ChoicePoint, Inc. reached a tentative settlement in a purported
class action that accuses it of violating the Employee
Retirement Income Security Act, according to its Feb. 29, 2008
form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2007.
The class action was filed May 20, 2005, with the U.S. District
Court for the Northern District of Georgia against the company
and certain individuals who are alleged to be fiduciaries under
the ChoicePoint, Inc. 401 (K) Profit Sharing Plan.
The suit alleged violations of ERISA fiduciary rules through the
acquisition and retention of ChoicePoint stock by the Plan on
and after Nov. 24, 2004.
The plaintiffs sought compensatory damages, injunctive and
equitable relief, attorneys' fees and costs.
On Nov. 21, 2007, a Settlement Agreement was signed by all
parties to the litigation and filed with the District Court.
Pursuant to the Settlement Agreement, the parties agreed to the
following equitable relief:
-- Plan participants will retain the right through
Dec. 31, 2010, to diversify freely out of the
Company's matching contribution made in the Company's
common stock;
-- the Company's matching contribution will be at least
25% for three years;
-- the Company will continue its current investment
education program for three years; and
-- the Company will post language on its intranet site
for three years that will advise participants to give
careful consideration of the benefits of a well-
balanced and diversified investment portfolio.
In addition, the Company agreed to pay $10,000 to the named
plaintiff, attorneys' fees and costs in the amount of $100,000,
costs of settlement notices to the class as well as costs of
settlement administration, and costs to retain an independent
fiduciary for settlement review and approval on behalf of Plan
participants.
On Dec. 6, 2007, the Company filed a Joint Motion for
Preliminary Approval of the Class Action Settlement with the
District Court, and on Dec. 11, 2007, the Company filed its
Joint Motion to Stay Appeal Pending Review and Approval of
Settlement with the District Court.
The suit is "Curtis R. Mellot v. ChoicePoint Inc., et al., Case
No. 1:05-cv-01340-JTC," filed with the U.S. District Court for
the Northern District of Georgia, Judge Jack T. Camp presiding.
Representing the plaintiffs are:
Thomas McKenna, Esq. (tjmckenna@gaineyandmckenna.com)
Gainey & McKenna, 4th Floor, 295 Madison Avenue
New York, NY 10017
Phone: 212-983-1300
Fax: 212-983-0383
Lisa T. Millican, Esq. (lisa.millican@lawofficepc.com)
Greenfield Millican, P.C.
800 The Grant Building, 44 Broad Street
NW Atlanta, GA 30303
Phone: 404-522-1122
Ronen Sarraf, Esq. (ronen@sarrafgentile.com)
Sarraf Gentile, LLP
485 Seventh Avenue, Suite 1005, Suite 1005
New York, NY 10018
Phone: 212-868-3610
- and -
Kenneth J. Vianale, Esq. (kvianale@vianalelaw.com)
Vianale & Vianale
2499 Glades Road, Suite 112
Boca Raton, FL 33431
Phone: 561-392-4750
Fax: 561-392-4775
CHOICEPOINT INC: Reaches $10M Settlement in CA Securities Suit
--------------------------------------------------------------
ChoicePoint, Inc. reached tentative $10-million settlement in a
consolidated securities fraud class action filed against it with
the U.S. District Court for the Central District of California,
according to the company's Feb. 29, 2008 form 10-K filing with
the U.S. Securities and Exchange Commission for the fiscal year
ended Dec. 31, 2007.
On March 4, 2005, a purchaser of the company's securities filed
a lawsuit against the company and certain of its officers with
the U.S. District Court for the Central District of California.
The complaint alleged that the defendants violated federal
securities laws by issuing false or misleading information in
connection with the fraudulent data access.
Additional similar complaints were filed by other purchasers of
the company's securities with the U.S. District Court for the
Central District of California on March 10, 2005, and in the
Northern District of Georgia on March 11, 2005, March 22, 2005
and March 24, 2005.
By court order, the cases pending in the California were
transferred to the U.S. District Court for the Northern District
of Georgia.
By order dated Aug. 5, 2005, the court consolidated the pending
cases into a single consolidated action, "In re ChoicePoint Inc.
Securities Litigation, 1:05-CV-00686."
On Nov. 14, 2005, the court entered an order appointing the
Alaska Laborers Employers Retirement Fund as lead plaintiff for
the proposed plaintiff class. A consolidated amended complaint
was filed on Jan. 13, 2006, seeking certification as a class
action and unspecified compensatory damages, attorneys' fees,
costs, and other relief.
On March 14, 2006, the defendants filed a motion to dismiss the
consolidated amended complaint. The motion was dismissed by the
court. Thus, on Jan. 25, 2007, the defendants filed a petition
asking the U.S. Circuit Court of Appeals for the Eleventh
Circuit to allow them to appeal on an interlocutory basis.
On May 3, 2007, the defendants' petition was denied. As a
result, the District Court re-opened the case.
Based on the subsequent U.S. Supreme Court decision in "Tellabs,
Inc. v. Makor Issues & Rights, Ltd.," which requires District
Courts to consider competing inferences of scienter rather than
just those most favorable to a plaintiff, the Company filed a
renewed motion to dismiss which is currently pending before the
District Court.
On Jan. 15, 2008, the Company entered into a Letter of
Understanding pursuant to which the parties to the litigation
would, subject to notice to the class, court approval and
certain other conditions, settle all claims.
Under the terms of the Letter of Understanding, the Company will
pay $10 million to the plaintiffs, subject to court approval.
The Company anticipates filing a definitive settlement agreement
with the U.S. District Court for the Northern District of
Georgia by March 31, 2008.
The suit is "In re ChoicePoint Inc. Securities Litigation, 1:05-
CV-00686," filed with the U.S. District Court for the Northern
District of Georgia, Judge Jack T. Camp presiding.
Representing the plaintiffs are:
Martin D. Chitwood, Esq. (mdc@classlaw.com)
Chitwood & Harley, Esq.
1230 Peachtree Street, N.E. 2300 Promenade II
Atlanta, GA 30309
Phone: 404-873-3900
Edward P. Dietrich, Esq. (edd@lerachlaw.com)
Lerach, Coughlin, Stoia, Geller, Rudman & Robbins, LLP
Suite 1900, 655 West Broadway
San Diego, CA 92101
Phone: 619-231-1058
Fax: 619-231-7423
- and -
Christopher Kim, Esq.
Lim, Ruger & Kim, LLP
1055 West 7th Street, 28th Floor
Los Angeles, California, 90017-2554
Phone: (213) 955-9500
Fax: (213) 955-9511
e-mail: info@lrklawyers.com
Representing the defendants is:
Tracy Cobb Braintwain, Esq. (tbraintwain@kslaw.com)
King & Spalding, LLP
1180 Peachtree Street, NE
Atlanta, GA 30309-3521
Phone: 404-572-2714
Fax: 404-572-5139
CHOICEPOINT INC: "Taylor" Matter Still Enjoined From Proceeding
---------------------------------------------------------------
The class action, "Taylor v. Acxiom Corp.," which is pending
against ChoicePoint, Inc., with the U.S. District Court for the
Eastern District of Texas remains enjoined from proceeding.
The suit was filed on Jan. 5, 2007, against the company and
certain of its competitors on behalf of each and every
individual in the State of Texas whose name, address, driver
identification number, and certain other identifiers are
contained in motor vehicle records obtained by the defendants
from the Texas Department of Public Safety without the express
consent of the individual during the period from June 1, 2000,
through the date of judgment.
The plaintiff also filed pleadings seeking to intervene in
"Richard Fresco, et al. v. Automotive Directions, Inc., et al.,
Case No. CIV-03-61063- Martinez/Klein."
The plaintiff is objecting to a proposed settlement agreement
for the case, which is pending in the U.S. District Court for
the Southern District of Florida.
Such plaintiff also filed a Motion to Stay Proceedings in the
"Fresco" litigation pending the outcome of the Texas Court's
class certification determination in "Taylor."
On Feb. 8, 2007, the company filed a motion to dismiss the
Taylor litigation based on the fact that Fresco was first-filed,
the nationwide class in "Fresco" encompasses the Texas class,
and reasons of judicial economy and fundamental fairness dictate
against duplicative class actions in federal courts.
The Taylor litigation is currently enjoined from proceeding
pursuant to the District Court's order issued in the Fresco
litigation.
The company reported no development in the matter in its Feb.
29, 2008 Form 10-K Filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2007.
The suit is "Taylor et al. v. Acxiom Corp. et al., Case No.
2:07-cv-00001-TJW," filed with the U.S. District Court for the
Eastern District of Texas, Judge Judge T. John Ward presiding.
Representing the plaintiffs is:
Jeremy Reade Wilson, Esq. (jwilson@corealaw.com)
The Corea Firm, PLLC
The Republic Center, 325 North St. Paul St., Ste. 4150
Dallas, TX 75201
Phone: 214-953-3900
Fax: 214-953-3901
Representing the defendants are:
David J. Beck, Esq. (dbeck@brsfirm.com)
Beck Redden & Secrest
1221 McKinney St., Suite 4500, One Houston Center
Houston, TX 77010-2020
Phone: 713/951-3700
Fax: 713/951-3720
George Barton Butts, Esq. (george.butts@dlapiper.coml)
DLA Piper Rudnick Gray Cary US LLP
12221 S. MoPac Expressway, Suite 400
Austin, TX 78746
Phone: 512/457-7068
Fax: 512/457-7001
- and -
James Patrick Kelley, Esq. (patkelley@icklaw.com)
Ireland Carroll & Kelley
6101 S. Broadway Ste. 500
Tyler, TX 75703
Phone: 903-561-1600
Fax: 903-581-1071
CHOICEPOINT INC: Fla. Court Considers DPPA Suit Settlement
----------------------------------------------------------
The U.S. District Court for the Southern District of Florida has
yet to grant final approval to a proposed settlement in the
class action, "Fresco, et al. v. Automotive Directions Inc., et
al.," which alleges violation of the Driver's Privacy Protection
Act and names ChoicePoint, Inc., as a defendant.
The class action was filed on Aug. 11, 2003, with the U.S.
District Court for the Southern District of Florida. It alleges
that the company obtained, disclosed and used information
obtained from the Florida Department of Highway Safety and Motor
Vehicles in violation of DPPA.
The plaintiffs seek to represent classes of individuals whose
personal information from Florida DHSMV records has been
obtained, disclosed and used for marketing purposes or other
allegedly impermissible uses by the company without the express
written consent of the individual.
A number of the company's competitors have also been sued in the
same or similar litigation in Florida. This complaint seeks
certification as a class action, compensatory damages,
attorneys' fees and costs, and injunctive and other relief.
The company has joined with the other defendants in a motion for
judgment on the pleadings as to the plaintiffs' "obtaining"
claim. To date, the court has not ruled on the pending motion.
After vigorously defending against the action, the defendants
engaged in court ordered mediation beginning in February 2006.
A proposed settlement agreement was filed with the court on
Dec. 20, 2006, on behalf of the plaintiffs and all but two of
the named defendants.
On May 11, 2007, the District Court entered orders which, among
other things:
-- granted preliminary approval of the proposed class
action settlement;
-- certified the conditional nationwide class;
-- denied the motion of the Texas plaintiffs (referenced
below) to intervene in Fresco;
-- and granted an injunction to maintain the status quo,
which prohibits the Texas action (referenced below)
from moving forward.
On May 11, 2007, the Texas intervenors and the putative class
members in the Texas case filed a notice of appeal with respect
to the denial of the motion for limited intervention and the
granting of the temporary injunction.
The U.S. Court of Appeals for the Eleventh Circuit, then issued
an order dated June 6, 2007, questioning whether it has
jurisdiction over the appeal.
The interested parties have submitted briefs to the Court of
Appeals responding to this question. To date, the Court of
Appeals has not ruled on the issue.
On June 13, 2007, the Texas intervenors filed a motion to stay
asking that the District Court stay implementation of the
settlement approval process until the Court of Appeals has had
time to evaluate the appeal.
On July 26, 2007, the District Court denied the Texas
intervenors' motion.
On Oct. 24, 2007, the District Court held the final approval
hearing on the proposed class action settlement. The Court has
not yet issued a ruling.
The company reported no development in the matter in its
Feb. 29, 2008 form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2007.
The suit is "Richard Fresco, et al. v. Automotive Directions,
Inc., et al., Case No. CIV-03-61063-Martinez/Klein," filed with
the U.S. District Court for the Southern District of Florida,
Judge Jose E. Martinez presiding.
Representing the plaintiffs are:
Tod N. Aronovitz, Esq. (ta@aronovitzlaw.com)
Aronovitz Trial Lawyers
150 W Flagler Street, Suite 2700 Museum Tower
Miami, FL 33130
Phone: 305-372-2772
Fax: 305-375-0243
- and -
Lawrence Dean Goodman, Esq.
(lgoodman@devinegoodman.com)
Devine Goodman Pallot & Wells
777 Brickell Avenue, Suite 850
Miami, FL 33131
Phone: 305-374-8200
Fax: 374-8208
Representing the defendants are:
Alan Graham Greer, Esq. (agreer@richmangreer.com)
Richman Greer Weil Brumbaug Mirabito & Christensen
201 S. Biscayne Boulevard Suite 1000
Miami, FL 33131
Phone: 305-373-4000
Fax: 305-373-4099
- and -
Deanna Kendall Shullman, Esq.
(deanna.shullman@tlolawfirm.com)
Holland & Knight
1 E. Broward Boulevard, Suite 1300
Fort Lauderdale, FL 33301-4811
Phone: 954-525-1000
Fax: 463-2030
COMMUNITY HEALTH: Appeals Class Certification Order in Ala. Suit
----------------------------------------------------------------
Community Health Systems, Inc., is appealing to the Alabama
Supreme Court a decision by the Circuit Court of Barbour County,
Alabama, Eufaula Division, granting class action status to a
lawsuit filed by uninsured individuals against the company.
The suit was filed by Arleana Lawrence and Lisa Nichols against
Eufaula Community Hospital, Community Health Systems, Inc.,
South Baldwin Regional Medical Center and Community Health
Systems Professional Services Corp.
The class action, captioned, "Arleana Lawrence and Robert
Hollins v. Lakeview Community Hospital and Community Health
Systems, Inc.," was brought by the plaintiffs on behalf of
themselves and as the representatives of similarly situated
uninsured individuals who were treated at the company's Lakeview
Hospital or any of the company's other Alabama hospitals.
The plaintiffs allege that uninsured patients who do not qualify
for Medicaid, Medicare or charity care are charged unreasonably
high rates for services and materials and that the company use
unconscionable methods to collect bills. They seek restitution
of overpayment, compensatory and other allowable damages and
injunctive relief.
In October 2005, the complaint was amended to eliminate one of
the named plaintiffs and to add Community Health's management
company subsidiary as a defendant. The complaint was again
amended in November 2005 to add another plaintiff, Lisa Nichols
and another defendant, a hospital in Foley, Alabama, South
Baldwin Regional Medical Center.
After a hearing, the Circuit Court, on Oct. 29, 2007, ruled in
favor of the plaintiffs' class action certification request.
The company disagree with that ruling and have pursued its
automatic right of appeal to the Alabama Supreme Court,
according to its Feb. 28, 2008 form 10-K filing with the U.S.
Securities and Exchange Commission for the fiscal year ended
Dec. 31, 2007.
Community Health Systems, Inc. -- http://www.chs.net-– through
its subsidiaries, owns, leases and operates acute care hospitals
that are the principal providers of primary healthcare services
in non-urban communities.
COMMUNITY HEALTH: Ill. Appellate Court Considers Appeal in "Rix"
----------------------------------------------------------------
The District Appellate Court has yet to rule on a plaintiff's
appeal of a decision by the Circuit Court of Williamson County,
Illinois that dismissed the purported class action, "Sheri Rix
v. Heartland Regional Medical Center and Health Care Systems,
Inc."
The litigation names Community Health Systems, Inc. and certain
of its subsidiaries as defendants. It was served against the
company on March 3, 2005, and was brought by the plaintiff on
behalf of herself and as the representative of similarly
situated uninsured individuals who were treated at the company's
Heartland Regional Medical Center.
The plaintiff alleges that uninsured patients who do not qualify
for Medicaid, Medicare or charity care are charged unreasonably
high rates for services and materials and that the company uses
unconscionable methods to collect bills.
The plaintiff seeks recovery for breach of contract and the
covenant of good faith and fair dealing, violation of the
Illinois Consumer Fraud and Deceptive Practices Act, restitution
of overpayment, and for unjust enrichment. The complaint also
seeks compensatory and other damages and equitable relief.
The Circuit Court Judge recently granted the company's motion to
dismiss this case, but allowed the plaintiff to re-plead her
case.
The plaintiff elected to appeal the Circuit Court's decision in
lieu of amending her case. Oral argument was heard on this case
on Jan. 9, 2008, and the company awaits the ruling of the
District Appellate Court, according to the company's Feb. 28,
2008 form 10-K filing with the U.S. Securities and Exchange
Commission for the fiscal year ended Dec. 31, 2007.
Community Health Systems, Inc. -- http://www.chs.net–- through
its subsidiaries, owns, leases and operates acute care hospitals
that are the principal providers of primary healthcare services
in non-urban communities.
COMMUNITY HEALTH: Discovery Still Ongoing in "Chronister" Matter
----------------------------------------------------------------
Discovery is still ongoing in the purported class action,
"Chronister, et al. v. Granite City Illinois Hospital Company,
LLC d/b/aGateway Regional Medical Center," which was filed with
the Circuit Court of Madison County, Illinois, and names
Community Health Systems, Inc., as a defendant.
The complaint, which was served against the company on April 8,
2005, seeks class-action status on behalf of the uninsured
patients treated at Gateway Regional Medical Center and alleges
statutory, common law, and consumer fraud in the manner in which
the hospital bills and collects for the services rendered to
uninsured patients.
The plaintiff seeks compensatory and punitive damages and
declaratory and injunctive relief.
The company's motion to dismiss has been granted in part and
denied in part and discovery has commenced.
The company reported no development in the matter in its
Feb. 28, 2008 form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2007.
Community Health Systems, Inc., -- http://www.chs.net-– through
its subsidiaries, owns, leases and operates acute care hospitals
that are the principal providers of primary healthcare services
in non-urban communities.
COMPUCREDIT CORP: Continues to Face N.C. Consumer Fraud Lawsuit
---------------------------------------------------------------
CompuCredit Corp. and five of its subsidiaries continue to face
a purported class action filed with the Superior Court of New
Hanover County, North Carolina, entitled, "Knox, et al. vs.
First Southern Cash Advance, et al., No. 5 CV 0445."
The plaintiffs allege that in conducting a so-called "payday
lending" business, certain of the Company's Retail Micro-Lending
and Servicing segment subsidiaries violated various laws
governing consumer finance, lending, check cashing, trade
practices and loan brokering.
The plaintiffs further allege that the Company is the alter ego
of its subsidiaries and is liable for their actions. The
plaintiffs are seeking damages of up to $75,000 per class
member.
CompuCredit Corp. reported no development in the matter in its
Feb. 29, 2008 form 10-K filing with the U.S. Securities and
Exchange Commission for the fiscal year ended Dec. 31, 2007.
CompuCredit Corp. -- http://www.compucredit.com/-- is a
provider of various credit and related financial services and
products to or associated with the underserved (or sub-prime)
consumer credit market, as well as to un-banked consumers.
CORINTHIAN COLLEGES: Ca. Suit Alleges Unfair Business Practices
---------------------------------------------------------------
A class action suit against Corinthian Colleges, Inc., and its
wholly owned subsidiary Corinthian Schools, Inc., was filed with
the Santa Clara Superior Court on behalf of graduates of the
Medical Assistant vocational programs offered by Bryman College,
which was renamed Everest College.
Corinthian offers vocational programs at approximately 14
schools located throughout California, including Santa Clara
County.
The programs, which typically last from six to 13 months, are
offered primarily to people who have graduated from or otherwise
left high school.
The lawsuit, which seeks unspecified monetary damages, alleges
the defendants made and continue to make untrue or misleading
statements related to the success of its graduates in obtaining
employment, including their prospects for starting salaries, in
order to induce members of the public to enroll in their
vocational training programs and purchase other goods and
services.
The suit also alleges Corinthian's statements that their schools
or programs are approved by the California Department of
Education are untrue. Corinthian reached a class action
settlement with California Attorney General Edmund G. Brown,
Jr., last July over similar allegations regarding other programs
by agreeing to pay $5,800,000 in restitution to students.
John L. Fallat, Esq., filed the lawsuit on behalf of the
plaintiffs Kathryn Leask, a graduate of the Everest College
medical assistant program, and her mother Judith Leask, who co-
signed Ms. Leask's student loans.
"The treatment of high school graduates such as Kathryn Leask by
these vocational schools is unconscionable," says Mr. Fallat.
"They charge an arm and a leg for tuition and mislead students
about employability. Upon graduation, many students simply
cannot find a job for which they have been trained, and are left
with the burden of tuition loans they cannot pay."
He noted that California law has strict requirements for these
schools, including but not limited to establishing at least a
60% placement rate after graduation.
"Defendant statements indicate a very high percentage of their
students obtain employment, which they have no basis to believe
is true," Mr. Fallat continues. "The fact is, Corinthian's own
statistics show the low percentage of former students who
obtained such employment."
According to Mr. Fallat, the vast majority of students enrolled
must finance the high cost of these courses. Charges for these
vocational programs typically range between $7,000 and $15,000.
Some longer courses cost as much as $27,000.
The suit alleges Corinthian offers or arranges financing through
lenders via a combination of government grants, government
subsidized loans, high-cost private loans and Corinthian's own
credit programs. Carnegie Student Loans and Sallie Mae, Inc.
are also named as defendants in the lawsuit.
For more information, contact:
Law Offices of John L. Fallat
Suite 100, 907 Sir Francis Drake Blvd.
Kentfield, CA 94904
Phone: (415) 457-3773
DVI INC: Settles "Merrill Lynch" Securities Lawsuit in Penna.
-------------------------------------------------------------
Lead plaintiffs in the class action, "In Re DVI, Inc. Securities
Litigation, Case No. 2:03-CV-5336," pending with the U.S.
District Court for the Eastern District of Pennsylvania, entered
into a partial settlement with Merrill Lynch & Co., Inc., one of
the named defendants.
The settlement terms include releases of the Settlement Class'
claims asserted against Merrill Lynch, brought pursuant to
Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder by the Securities and Exchange
Commission.
The Lead Plaintiffs have settled their claims against Merrill
Lynch, which was a former lender to DVI and underwriter in
certain "securitization" transactions, for cash payment of
$4,500,000.
The final amount distributed to Settlement Class Members will
depend upon the amount of interest earned on these funds and the
amount of Court-approved attorneys' fees, costs and expenses,
and Notice and Administration Costs.
The parties to this litigation do not agree on the amount of
damages per Common Share and per Senior Note that would be
recoverable if the Settlement Class were to prevail on each
claim alleged. The parties also do not agree as to whether the
Settlement Class suffered damages, the amount thereof and how to
measure damages.
The Lead Plaintiffs are proposing the Settlement because, upon
consideration of, among other things, the record, the potential
damages, the strength of the Settlement Class' claims and the
risks and cost of continued litigation, the Settlement provides
substantial recovery to the Settlement Class, is fair,
reasonable and adequate, and is preferable to continued
litigation. Merrill Lynch denies any liability or wrongdoing,
but desires to resolve the claims asserted under the terms set
forth herein and, in more detail, in the Stipulation.
Case Background
In 2003, DVI, Inc. was named defendant in a lawsuit filed with
the U.S. District Court for the Eastern District of Pennsylvania
alleging violations of Sections 10(b) and 20(a) of the U.S.
Securities Exchange Act of 1934, and Rule 10b-5 promulgated
thereunder.
The suit alleged that the company issued a series of material
misrepresentations to the market between Nov. 7, 2001, and
June 27, 2003, thereby artificially inflating the price of DVI's
publicly traded securities.
The complaint alleged that these statements were materially
false and misleading because they failed to disclose and
misrepresented these adverse facts, among others:
-- that the company had failed to timely write down the
value of certain assets which had become impaired;
-- that the company's accounting and financial reporting
policies and procedures for non-systematic (non-
recurring) transactions were inadequate;
-- that the company lacked adequate internal controls and
was therefore unable to ascertain the true financial
condition of the company; and
-- that as a result, the values of the company's assets,
net income and earnings per share were materially
overstated at all relevant times.
The class period ended June 27, 2003. On that date, DVI shocked
the investing public when it announced that the U.S. Securities
and Exchange Commission had rejected its March 30, 2003
quarterly report because an independent auditor had not reviewed
it.
The company also disclosed that it was continuing to consider
the need for the accounting change, and, if adopted, its net
income for the third quarter of fiscal 2003, its earnings per
share for the first nine months of fiscal 2003 and its net
income for the fiscal year 2002 would all be drastically
reduced.
Specifically, $1.4 million, or 44.47%, its earnings per share
for the nine months ended March 31, 2003, was reduced by $0.10,
or 44.45% and its net income for fiscal year ended June 30,
2002, was reduced by $1.395 million or 34.12%, reduced the
company's net income for the third quarter of fiscal 2003.
Investor reaction was swift and negative, with DVI stock falling
from a close of $5.84 on June 26, 2003 to a close of $4.30 on
June 27, 2003, or a single-day decline of more than 26% on very
high trading volume.
The class consists of all persons or entities that purchased or
otherwise acquired the securities of DVI (its common stock and 9
7/8% Senior Notes), between Aug. 10, 1999, and Aug. 13, 2003,
both dates inclusive.
Deadline to file for exclusions and objections is on April 10,
2008. Deadline to file claims is on July 7, 2008.
A fairness hearing will be held before the Honorable Legrome D.
Davis in the U.S. District Court for the Eastern District of
Pennsylvania on April 30, 2008 at 2:00 p.m.
The suit is "In Re DVI, Inc. Securities Litigation, Case No.
2:03-CV-5336," filed with the U.S. District Court for the
Eastern District of Pennsylvania under Judge Legrome D. Davis.
Representing the defendants are:
Antonia M. Apps, Esq.
Kellogg, Huber, Hansen, Todd and Evans, PLLC
1615 M. Street, North West, Suite 400
Washington, DC 20005
Phone: 202-326-7900
Thomas V. Ayala, Esq. (tayala@morganlewis.com)
Morgan Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
Phone: 215-963-5719
- and -
Gregory Ballard, Esq. (gregory.ballard@cwt.com)
Cadwalader Wickersham & Taft LLP
One World, Financial Center
New York, NY 10281
Phone: 212-504-6701
Representing the plaintiffs is:
M. Reas Bowman, Esq.
Krislov & Associates Ltd
20 N. Wacker Dr., Suite 1350
Chicago, IL 60606
Phone: 312-506-0500
GENERAL REINSURANCE: No Trial Date Set for AIG Securities Suit
--------------------------------------------------------------
No trial date was scheduled for the consolidated securities
class action, "In re American International Group Securities
Litigation, Case No. 04-CV-8141," which names General
Reinsurance Corp., an indirect wholly owned subsidiary of
Berkshire Hathaway, Inc., as one of the defendants.
The putative class action is brought on behalf of investors who
purchased publicly traded securities of AIG between October 1999
and March 2005.
The complaint, originally filed in April 2005, asserts various
claims against AIG and certain of its officers, directors,
investment banks and other parties, including Messrs. Ferguson,
Napier and Houldsworth.
The complaint alleges that the General Re Defendants violated
Section 10(b) of the U.S. Securities Exchange Act and Rule 10b-5
in connection with the AIG Transaction. It seeks damages and
other relief in unspecified amounts.
General Reinsurance has answered the complaint, denying
liability and asserting various affirmative defenses.
Document production has begun, but no other discovery has taken
place. No trial date has been scheduled.
Berkshire Hathaway, Inc. reported no development in the matter
in its Feb. 29, 2008 form 10-K filing with the U.S. Securities
and Exchange Commission for the fiscal year ended Dec. 31, 2007.
The suit is "In Re American International Group, Inc. Securities
Litigation, Case No. 1:04-cv-08141-JES," filed with the U.S.
District Court for the Southern District of New York, Judge John
E. Sprizzo presiding.
Representing the plaintiffs are:
Thomas A. Dubbs, Esq. (tdubbs@glrslaw.com)
Goodkind Labaton Rudoff & Sucharow LLP
100 Park Avenue
New York, NY 10017
Phone: 212-907-0700
Fax: 212-818-0477
- and -
Louis Gottlieb, Esq. (lgottlieb@glrslaw.com)
Goldman Gruder & Wood
200 Connecticut Avenue
Norwalk, CT 06854
Phone: (212) 907-0872
Fax: (212) 883-7072
Representing the defendants are:
Steven Ian Froot, Esq. (sfroot@bsfllp.com)
Boies, Schiller & Flexner, LLP
570 Lexington Avenue
New York, NY 10022
Phone: (212)-446-2300
Fax: (212)-446-2350
- and -
George Abraham Zimmerman, Esq. (gzimmerm@skadden.com)
Skaddden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY 10036
Phone: (212) 735-2000 x2047
Fax: (212) 735-2000
GENERAL REINSURANCE: Still Faces Litigation Over ROA Insurance
--------------------------------------------------------------
General Reinsurance Corp., an indirect wholly owned subsidiary
of Berkshire Hathaway, Inc., still faces several lawsuits over
insurance purchased through Reciprocal of America.
The company and several current and former employees, along with
numerous other defendants, have been sued in 13 federal lawsuits
involving ROA and related entities. Nine are putative class
actions initiated by doctors, hospitals and lawyers that
purchased insurance through ROA or certain of its Tennessee-
based risk retention groups.
ROA was a Virginia-based reciprocal insurer and reinsurer of
physician, hospital and lawyer professional liability risks.
The complaints seek compensatory, treble, and punitive damages
in an amount plaintiffs contend is just and reasonable.
Berkshire Hathaway, Inc. reported no development in the matters
in its Feb. 29, 2008 form 10-K filing with the U.S. Securities
and Exchange Commission for the fiscal year ended Dec. 31, 2007.
Berkshire Hathaway Inc. -- http://www.berkshirehathaway.com/--
is a holding company owning subsidiaries engaged in a number of
diverse business activities with the most important being
insurance businesses conducted on both a primary basis and a
reinsurance basis.
HIH INSURANCE: Ex-Director Settles Misleading Conduct Claim
-----------------------------------------------------------
Rodney Adler has settled a misleading and deceptive conduct
claim relating to a class-action lawsuit brought on behalf of
shareholders of HIH Insurance Ltd., The Australian reports.
Mr. Adler was the head of FAI Insurances, which HIH purchased in
1998. He was also a director of HIH.
The class-action suit, brought by HIH shareholder Brian Johnston
in 2007, is based on comments that Mr. Adler made to the press
about buying shares in HIH. Mr. Johnston, who bought 40,000
shares in HIH in January 2001, claimed that he was induced to
buy the shares following Mr. Adler's comments.
Mr. Adler's words were said to be misleading and deceptive
conduct because Mr. Johnston and other investors would not have
bought the shares "had the true and correct information and
circumstances relating to the purchase of the shares by the
respondent been divulged and made available to them."
Mr. Johnston had sought a court declaration that Mr. Adler had
engaged in misleading and deceptive conduct, damages, interest
and for his legal costs to be paid.
Mr. Adler was jailed and released in December last year after
pleading guilty in 2005 to four charges arising from his conduct
as an HIH director.
As noted in the Troubled Company Reporter-Asia Pacific, the HIH
Group failed in March 2001, with a deficiency reaching billions
of AU dollars. Provisional liquidators were appointed to HIH
Insurance and many of its subsidiaries. Other insolvency
practitioners were appointed to various group companies
incorporated in other parts of the world. In August 2001, the
major Australian companies in the HIH Group were placed into
liquidation.
In latest developments, The Australian says that federal court
judge Steven Rares was told that the parties to the lawsuit had
settled the claim.
However, Lawyer Bruce Dennis, who was running the case, told The
Australian that he could not disclose the terms of the
settlement as they were confidential.
IKANOS COMMS: Court Dismisses Securities Lawsuit
------------------------------------------------
The U.S. District Court for the Southern District of New York
has dismissed the securities class action suit filed against
Ikanos Communications, Inc., certain of its directors and
officers and two investment banks.
In November 2006, three putative class actions were filed
against the company, its directors, an executive officer and a
former executive officer.
These lawsuits allege certain misrepresentations by the company
in connection with its initial public offering in September
2005, the follow-on offering in March 2006, and thereafter
concerning its business and prospects. The lawsuits seek
unspecified damages.
The lawsuits were consolidated and an amended complaint was
filed on April 24, 2007.
The amended complaint alleges certain material
misrepresentations and omissions by the Company in connection
with its initial public offering in September 2005 and the
follow-on offering in March 2006 concerning its business and
prospects, and seeks unspecified damages.
On June 25, 2007, the defendants filed motions to dismiss the
amended complaint (Class Action Reporter, Nov. 30, 2007).
The recent 21-page order of dismissal reviewed all of the
plaintiffs' allegations in detail, and determined that there was
no basis to proceed further against the defendants.
Pointing to the actual statements contained in the Company's
offering documents, the court noted that Ikanos' disclosures
"were more than adequate. They are of sufficient precision and
clarity to alert prudent investors to the nature of the
offerings and the risks entailed."
"We are very pleased with the court's ruling," said Noah D.
Mesel, vice president and general counsel of Ikanos. "With this
ruling, we are able to focus all of our efforts on managing our
business."
The plaintiffs have 30 days from entry of judgment to appeal the
decision.
The suit is "Panther Partners Inc., et al. v. Ikanos
Communications, Inc., et al., Case No. 1:06-cv-12967-PAC," filed
with the U.S. District Court for the Southern District of New
York under Judge Paul A. Crotty.
Representing the plaintiffs is:
David Avi Rosenfeld, Esq. (drosenfeld@lerachlaw.com)
Lerach Coughlin Stoia Geller Rudman & Robbins LLP
58 South Service Road, Suite 200
Melville, NY 11747
Phone: (631) 367-7100
Fax: (631) 367-1173
Representing the defendant is:
James N. Kramer, Esq. (jkramer@orrick.com)
Orrick, Herrington & Sutcliffe LLP
The Orrick Building, 405 Howard Street
San Francisco, CA 94105
Phone: (415)-773-5700
Fax: (415)-773-5759
MOBILE OPERATORS: Customers' $2.5B Suit in Jerusalem Dismissed
--------------------------------------------------------------
Partner Communications Company Ltd. (TASE:PTNR), a leading
Israeli mobile communications operator, announced that on
March 5, 2008, following the plaintiffs' request, a claim that
was filed with the Jerusalem District Court in January 2007
against the Company, two other cellular operators and two land-
line operators, was dismissed with prejudice, and a request for
the certification of the claim as a class action was dismissed
without prejudice.
In January 2007, Israeli mobile communications operators were
faced with a ILS10.61 billion ($2.5 billion) suit seeking
certification of a purported class of customers allegedly harmed
by the company's alleged violation of the country's
Communication Law (Class Action Reporter, Feb. 6, 2007)
The suit was filed by three plaintiffs in Jerusalem District
Court against:
-- Partner Communications Co. Ltd.,
-- Israel Telecommunications Corp. Ltd.,
-- Hot Cable Systems Media Ltd.,
-- Cellcom Israel Ltd., and
-- Pelephone Communications Ltd.
The defendants allegedly have not implemented number portability
and are in violation of the Communication Law, mandating the
implementation of telephone number portability starting Sept. 1,
2006. The defendants, thus, are allegedly harming the claimants
and consumers of telephone services in general.
The claimants are demanding about ILS1,000 ($235) for each
customer. The suit affects Partner Communications' 2,626,000
customers, according to the company.
Partner Communications -- http://www.investors.partner.co.il--
is a subsidiary of Hutchison Telecommunications.
OANDO PLC: May Face Lawsuit Over Adulterated Imported Petrol
------------------------------------------------------------
Motorists and other fuel users affected by the adulterated
petrol imported by Oando Plc have commenced moves to institute a
class action lawsuit against the company for damage to their
vehicles, Vanguard reports.
Investigations by Vanguard at various car repair garages,
including Coscharis Motors, Germaine Autos, Volkswagen, Globe
Motors and Bras Motors, revealed that legal practitioners
contracted by owners of affected vehicles were busy gathering
details to harmonize their positions.
According to the report, Kashiet Issah, Service Manager of Bras
Motors, confirmed that there have been inquiries from legal
practitioners representing owners of affected vehicles. He said
that up to 30 cases had been recorded in his outlet alone and
that all the vehicles affected had to be towed in for repair
work.
"In most cases, we had to carry out fuel injector nozzles, fuel
pump and plugs replacement, while also dropping the fuel tank
for thorough cleaning and blowing of the fuel line," Mr. Issah
told Vanguard. He also said that similar cases had been
reported at other vehicle repair garages and that what had been
retrieved from dropped fuel tanks was anything but petrol.
John Iyene, legal counsel to three of the affected motorists,
confirmed to Vanguard that he was in touch with some legal
representatives of others who were largely dissatisfied with the
caveat imposed by Oando about verifiable claims. Mr. Iyene said
that as soon as he and other legal representatives were able to
harmonize their positions, a class action suit would be
instituted against Oando.
According to Vanguard, Lola Amao, Chairperson of Organisation of
Design Engineers of Nigeria, lamented the role of the Department
of Petroleum Resources in the importation and distribution of
the product. She said there should be a procedure in place to
guarantee quality assurance and quality control, adding "Who
were the people who approved the importation of the product?"
Dr. Amao noted that sometimes the DPR is not aware of those who
have been given the go ahead to bring in petroleum products and
asked the oil industry reform implementation committee, headed
by Dr. Emmanuel Ebogah, "to come up with a clear cut position on
who is responsible for allocation."
"This is the only way to determine easily who is to be held
responsible in the event of any lapses," Dr. Amao shared to
Vanguard.
The DPR fingered Oando Plc for importing ethanol as petrol and
distributing it to motorists and causing damage to vehicles,
generating sets and other engines, the report adds.
OMAHA MEATPACKERS: Face Lawsuits Over Employee Payments
-------------------------------------------------------
Two meatpacking plants in Omaha face almost identical federal
lawsuits accusing them of not paying thousands of workers for
all their work, the Associated Press reports.
According to AP, lawyers for the workers are seeking class-
action status for the lawsuits filed last week against Greater
Omaha Packing Co. and Nebraska Beef Ltd. A total of 16 people
-- seven former employees and one current employee at each plant
-- are listed as plaintiffs.
Both companies have allegdely violated state and federal wage
and labor laws for years, the lawsuits said.
The lawsuits also stated that the plants have policies that
production workers are paid "only during the time that they are
present on the actual production assembly line under a system
known as 'gang time' or 'line time.'"
AP writes that the workers are seeking unpaid wages and overtime
for time before and after assembly line work, as well as time
spent putting on uniforms and safety gear, sanitizing equipment,
retrieving, sharpening and putting away knives, walking between
work sites and other duties. That work outside production
assembly line work amounts to between 30 and 40 minutes each day
per worker, according to the lawsuits.
The workers' lawyers estimate that about 1,500 former and
current workers at Greater Omaha workers and 1,800 at Nebraska
Beef have been affected over the past four years. Workers at
the plants before that time are not covered under Nebraska's
statute of limitations.
PENNSYLVANIA: Delinquent Tax Communications Suit Settled
--------------------------------------------------------
The law firm of Donovan Searles, LLC, obtained a $5,213,670
class action verdict in the case titled "Roethlein v. Portnoff
Law Associates, Ltd., November Term 2002, No. 3888," filed with
the Philadelphia Court of Common Pleas.
The case was filed on behalf of Pennsylvania real property
owners who received delinquent tax communications from the law
firm of Portnoff Law Associates and were charged unauthorized
fees, interest, penalties or attorney fees by that law firm.
The case was tried before the Honorable Mark I. Bernstein over
ten days in September, 2007. In a detailed Order, Memorandum
Opinion and Findings of Fact issued on March 12, 2008, the Court
found that the defendants had "refused to obey the law" by
continuing to charge and collect fees, interest, penalties and
attorney fees that the Pennsylvania courts had forbidden.
The Court wrote: "The defendants refused to obey the law, and
failed to even notify their clients that significant decisions
forbidding their collection practices had been handed down. A
penalty for continuing to charge add-on attorney fees in
disregard of clear appellate court decisions and retaining those
add-on attorney fees previously mistakenly charged must be
imposed."
The Court entered a verdict against defendants awarding the
Class $2,654,972 for unlawfully received attorney's fees,
$510,855 for unlawfully collected administrative fees, and
$18,493 for interest on the unlawfully collected administrative
fees. Under the Pennsylvania law known as Act 6, the Court
doubled the award relating to the administrative fees for a
total of $1,058,697 and assessed a $500,000 statutory penalty.
The Court also awarded $1,000,000 in punitive damages due to the
defendants' "intentional disregard of the rule of law as stated
by the Appellate Courts of Pennsylvania."
Donovan Searles partner David A. Searles was one of the lead
trial counsel for the class in the case. He says, "We are
gratified by the detailed and careful decision of the trial
court, which makes clear that debt collection lawyers must
follow the law and cannot collect add-on attorney fees when the
appellate courts have held those fees to be unauthorized."
The Roethlein case is the third class action successfully tried
to verdict by Donovan Searles lawyers in the last three years.
For more information, contact:
David A. Searles, Esq. (dsearles@donovansearles.com)
Donovan Searles, LLC
1845 Walnut Street, Suite 1100
Philadelphia, PA 19103
Phone: (800) 619-1677
(215) 732-6067
Web site: http://www.donovansearles.com
RC2 CORP: Sued Over Lead Content in Paint Used on Toys
------------------------------------------------------
Boca Raton residents Mindy and Daniel McGuire have filed a class
action lawsuit against Learning Curve Brands -- also known as
RC2 Corporation -- alleging that lead-based paint on the toy
maker's Thomas and Friends Wooden Railway toys caused their now
five-year-old son, Jared, to suffer a developmental disorder,
Sun-Sentinel reports.
The MacGuires accuse RC2 of negligence and product liability.
They contend that Jared was exposed to "substantial and
dangerous levels" of lead when he placed the Thomas and Friends
toys in his mouth, the lawsuit states.
Learning Curve and RC2 should have known that adequate
safeguards and oversight would not be present when the company
opted to have its toys manufactured in China, the McGuires'
allege.
Sun-Sentinel recounts that in June 2007, RC2 announced a recall
of some wooden railway vehicles and set components from the
Thomas & Friends Wooden Railway product line due to lead in the
paint. The affected toys were made between January 2005 and
April 2007. The company recalled additional Thomas and Friends
toys in September.
According to Sun-Sentinel, the McGuires are seeking in excess of
$15,000, which is the threshold necessary for the case to be
heard in circuit court.
SUNBEAM PRODUCTS: Heating Pads Catch Fire, Fla. Lawsuit Claims
--------------------------------------------------------------
Sunbeam Products, Inc. -- d/b/a Jarden Consumer Solutions -- is
facing a class-action complaint filed on Mar. 11, 2008, with the
U.S. District Court for the Southern District of Florida
claiming that Sunbeam's Soft Touch Heating Pad's defective
design causes it to overheat, burning the user, burning the pad,
and sometimes setting the pad on fire, CourtHouse News Service
reports.
According to the complaint, Sunbeam makes the pads with outmoded
resistive wire technology.
The plaintiffs bring the action pursuant to rule 23 of the
Federal Rules of Civil Procedure on behalf of all persons in the
United States who purchased a Sunbeam Soft Touch Heating Pad or
other Sunbeam heating pad utilizing "resistive wire" technology
as its heating element.
The plaintiffs want the court to rule on:
(a) whether the Sunbeam Soft Touch Heating Pads, and other
Sunbeam heating pads using a "resistive wire"
technology for their heating element are defective;
(b) whether Sunbeam violated FDUTPA by selling defective
heating pads and by continuing to do so with knowledge
that the products were defective;
(c) whether Sunbeam violated FDUTPA by failing to warn its
customers in a timely and effective manner that the
subject heating pads were defective;
(d) whether Sunbeam violated FDUTPA by failing to take
appropriate remedial measures to fix the defective
heating pads;
(e) whether plaintiffs and the members of the class are
entitled to compensatory damages and, if, so, what the
proper measure of such damages should be; and
(f) whether injunctive relief requiring Sunbeam either to
recall the affected heating pads or to warn its
customers of the defects in the subject heating pads is
appropriate.
The plaintiffs demand judgment against Sunbeam requiring it to
disgorge and return the purchase price of the subject heating
pads, together with costs and interest, and any further relief
the court deems appropriate.
The suit is "Carol Belle et al. v. Sunbeam Products, Inc., Case
No. 08-80257-CIV-HUrley/Hopkins," filed with the U.S. District
Court for the Southern District of Florida.
Representing the plaintiffs are:
Lewis S. Eidson, Esq.
Curtis B. Miner, Esq. (curt@colson.com)
Colson Hicks Edison
255 Aragon Avenue, Second Floor
Coral Gables, Florida 33134
Phone: (305) 476-7400
Fax: (305) 476-7444
SUNOPTA INC: Federman Reminds Investors of Mar. 28 Deadline
-----------------------------------------------------------
Federman & Sherwood reminds shareholders of the March 28, 2008
deadline to file lead plaintiff applications for the class
action lawsuit against SunOpta, Inc. (NasdaqGS:STKL) with the
United States District Court for the Southern District of New
York.
The suit was filed on Jan. 28 on behalf of a class consisting of
all persons or entities who purchased or otherwise acquired the
common stock of SunOpta Inc. between Aug. 8, 2007, and Jan. 25,
2008, inclusive (Class Action Reporter, Feb. 12, 2008).
The complaint alleges violations of federal securities laws,
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b-5, including allegations of issuing a series of
material misrepresentations to the market which had the effect
of artificially inflating the market price.
In Feb., Federman & Sherwood expanded the class period in the
securities class action to include those investors who bought or
sold between May 8, 2007, to January 25, 2008 (Class Action
Reporter, Feb. 18, 2008).
The plaintiff seeks to recover damages on behalf of the Class.
For more information, contact:
William B. Federman, Esq. (wfederman@aol.com)
Federman & Sherwood
10205 North Pennsylvania Avenue
Oklahoma City, OK 73120
Web site: http://www.federmanlaw.com
TOYS R US: Faces N.Y. Lawsuit Over Deceptive Business Practices
---------------------------------------------------------------
Toys "R" Us, Inc. is facing a class-action complaint filed with
the New York State Supreme Court, Kings County alleging it
deceptively fails to warn customers that it does not allow
refunds or credit for products returned opened but unused,
CourtHouse News Service reports.
The action seeks redress for a deceptive and otherwise improper
business practice that defendant engages in with respect to is
return policy and refusal to give its customers refunds or store
credit for certain merchandise returned opened but unused.
Named plaintiff Aaron Goldring alleges that upon returning a
select item purchased at Toys "R" Us -- still in its original
condition and containing all original packaging and accessories
-- have been refused a refund or store credit if the merchandise
was returned in an opened box.
Toys "R" Us imposes this no refund and no exchange return policy
unilaterally and without adequate notice to its customers. In
violation of applicable New York statutes, Toys "R" Us does not
provide conspicuous notice, and does not fully disclose, the
terms of its return and refund policy.
As a result, customers have been deprived of the benefit of
their bargain (i.e., a full refund or store credit of the
purchase price if the select product is returned in its original
condition and containing all accessories), resulting in
defendant's improper and unlawful monetary gain and benefit.
This suit is brought, pursuant to the New York General Business
Law Sections 349 and 218-a, and the common law of New York, on
behalf of a statewide class of all persons in the State of New
York who have been denied a cash refund or a credit upon
returning select merchandise purchased from defendant during the
period from March 1, 2002, to the present.
The plaintiff asks the court to enter an order:
-- certifying this action as a class action;
-- awarding against defendant the damages that plaintiff
and the other members of the class have suffered as a
result of defendant's actions, the amount of such
damages to be determined at trial, plus attorneys' fees;
-- awarding against defendant the damages that plaintiff
and the other members of the class have suffered as a
result of defendant's actions, the amount of such
damages to be determined at trial, plus attorneys' fees;
-- awarding against defendant the damages that plaintiff
and the other members of the class have suffered as a
result of defendant's actions, the amount of such
damages to be determined at trial, plus attorneys' fees;
-- (a)declaring that defendant's no refund/no credit return
policy is misleading, deceptive and improper
(b) preliminarily and permanently enjoining defendant
from continuing its decetive practice and policies
relating to the imposition of a no refund/no credit
retunr policy;
(c) ordering defendant to compensate customers denied
refunds or credit upon returning certain select
merchandise; and
(d) ordering defendant to take immediately all steps
reasonable necessary to inform current customers of
defendant's return policy; and
-- awarding plaintiff interest, costs and attorneys' fees.
The suit is "Aaron Goldring et al. v. Toys "R" Us, Inc.," filed
with the New York State Supreme Court, Kings County.
Representing the plaintiffs is:
Jerome Noll, Esq.
1311 Mamaroneck Avenue, Suite 220
White Plains, New York 10605
Phone: (914) 517-5000
U.S. HOUSING DEPT: To Pay Employees $24MM in Settlement of Suit
---------------------------------------------------------------
The federal Department of Housing and Urban Development has
agreed to pay $24 million to current and former employees who
were not compensated properly under the Fair Labor Standards
Act, the Associated Press reports.
According to AP, the payment to an estimated 7,000 people is
part of a settlement that the department has agreed to in an
effort to settle a class-action and grievance related to
overtime exemptions and pay filed by trade unions.
Michael Snider, Esq., who represents the unions, said that
arbitrator Sean Rogers approved and signed the agreement on
Monday.
AP recounts that the grievance was filed in 2003 by Carolyn
Federoff who leads the American Federation of Government
Employees Council 222 in Boston. She alleged that employees
were misclassified as exempt under the Fair Labor Standards Act.
This denied them pay for overtime hours that were worked, a
choice of compensatory time off and pay for travel time and "off
the clock" work.
W.R. GRACE: Plaintiffs Appeal Dismissal of ERISA Suits in Mass.
---------------------------------------------------------------
The plaintiffs in two purported class actions against W.R. Grace
& Co., alleging violations of the Employee Retirement Income
Security Act of 1974, are appealing the dismissal of their
respective cases to the U.S. Court of Appeals for the First
Circuit, according to Grace's Feb. 29, 2008 form 10-K filing
with the U.S. Securities and Exchange Commission for the fiscal
year ended Dec. 31, 2007.
Evans Litigation
In June 2004, a purported class action-complaint, "Evans v.
Akers et al., Case No. 1:04-cv-11380-WGY," was filed with U.S.
District Court for the District of Massachusetts against the
Board of Directors, certain current and former Grace officers
and employees, and others, relating to the Grace 401(k) Savings
and Investment Plan, also known as the S&I Plan.
The complaint alleges that the decline in the price of Grace
common stock from July 1999 through February 2004 resulted in
significant losses to S&I Plan participants.
It further alleges that the defendants breached their fiduciary
duties under ERISA, by failing to sell or take other appropriate
action with regard to Grace common stock held by the S&I Plan
during that period, and by failing to disclose to S&I Plan
participants the risk of investing in Grace common stock.
The complaint seeks compensatory damages for the S&I Plan from
the defendants.
Bunch Litigation
On Oct. 26, 2004, a purported class-action complaint, "Bunch et
al. v. W. R. Grace & Co. et al.," also related to the S&I Plan
was filed with the U.S. District Court for the Eastern District
of Kentucky against Grace, the Investment and Benefits
Committee, the Board of Directors, certain current and former
Grace officers and employees, and others.
The complaint alleges that Grace and its investment advisors
breached fiduciary duties under ERISA by selling Grace common
stock from the S&I Plan at a distressed price.
It further alleges that Grace breached fiduciary duties under
ERISA by hiring State Street Bank and Trust Company, the
investment manager for the S&I Plan that Grace retained in
December 2003, to rapidly liquidate all of the employees' Grace
common stock investment at an artificially low sales price.
Recent Developments
On July 21, 2005, the U.S. District Court for the Eastern
District of Kentucky granted the defendants' motion to transfer
the Bunch action to the U.S. District Court for the District of
Massachusetts, under Case No. 1:05-cv-11602-WGY.
On Aug. 23, 2005, the Massachusetts District Court consolidated
into one case both the Bunch action and the Evans action. Grace
expects that it would have an obligation to indemnify the other
defendants for any liability arising out
of the consolidated lawsuit.
In December 2006, the Massachusetts District Court dismissed the
Evans claims, on grounds that the Evans plaintiffs lacked
standing to bring suit.
The Evans plaintiffs' petitioned the U.S. Court of Appeals for
the First Circuit to reverse the District Court's dismissal of
their claims and on Feb. 7, 2008, the First Circuit heard oral
argument regarding their appeal.
On Jan. 30, 2008, the court ruled in favor of the defendants on
the Bunch action, holding that State Street and Grace did not
breach their fiduciary duties under ERISA.
On Feb. 13, 2008, the Bunch plaintiffs appealed the
Massachusetts District Court's decision to the First Circuit.
That appeal is pending.
W.R. Grace & Co. -- http://www.grace.com/-- through its
subsidiaries, is engaged in specialty chemicals and specialty
materials businesses on a worldwide basis.
W.R. GRACE: Faces Mass. Litigation Alleging ERISA Violations
------------------------------------------------------------
W.R. Grace & Co. faces a purported class action that was filed
with the U.S. District Court for the District of Massachusetts,
alleging violations of the Employee Retirement Income Security
Act of 1974, according to Grace's Feb. 29, 2008 form 10-K filing
with the U.S. Securities and Exchange Commission for the fiscal
year ended Dec. 31, 2007.
The suit, "Siamis v. Akers et al., Case No. 1:2008cv10193," was
filed on Feb. 6, 2008, by Mark Siamis. It names as defendants:
-- John F. Akers,
-- Ronald C. Cambre,
-- Marye Anne Fox,
-- John J. Murphy,
-- Paul J. Norris,
-- Thomas A. Vanderslice,
-- H. Furlong Baldwin, Investments and Benefits
Committee,
-- Administrative Committee,
-- Brenda Gottleib,
-- W. Brian McGowan,
-- Michael Piergrossi,
-- Robert M. Tarola,
-- Eileen Walsh,
-- David Nakashige,
-- Elyse Napoli, Martin Hunter, and
-- Ren Lapadario.
In general, the suit alleges that the decline in the price of
Grace common stock 2004 resulted in significant losses to Grace
401(k) Savings and Investment Plan participants.
The suit, "Siamis v. Akers et al., Case No. 08-10193," was filed
with the U.S. District Court for the District of Massachusetts,
Judge William G. Young presiding.
Representing the plaintiffs are:
David Pastor, Esq. (dpastor@gilmanpastor.com)
Gilman and Pastor, LLP
225 Franklin Street, 16th Floor
Boston, MA 02110
Phone: 617-742-9700
Fax: 617-742-9701
WATCHGUARD TECH: Court Dismisses Suit vs. 2 Private Equity Firms
----------------------------------------------------------------
A federal district court judge in the Western District of
Washington recently dismissed an antitrust class action suit
alleging that two private equity funds had unlawfully conspired
in their bid to acquire WatchGuard Technologies, Mondaq News
reports.
The lawsuit, "Pennsylvania Avenue Funds v. Borey, No. C06-
1737RAJ" was filed with U.S. District Court for the Western
District of Washington, on Feb. 21, 2008.
According to Mondaq, the opinion is particularly noteworthy as
it holds that allegations of coordination among bidders in the
acquisition of a public company cannot be treated as per se
unlawful under the antitrust laws. Under Pennsylvania Ave.,
such joint bidding arrangements must be evaluated under the rule
of reason.
The court further held that the plaintiff's allegations did not
withstand a rule of reason analysis because there was no
allegation from which the court could reasonably infer that
defendants had market power even in a narrowly defined market
for corporate control over WatchGuard.
Mondaq says that although there have been other suits alleging
antitrust violations in connection with joint bidding activities
by private equity firms, this is the first decision addressing
the substantive antitrust issues concerning such arrangements.
The Pennsylvania Ave. decision is a significant development for
private equity firms involved in joint bidding activities.
The report recounts that the Pennsylvania Ave. case arose out of
the acquisition of WatchGuard by Francisco Partners L.P. and
Vector Capital Corporation. As part of the auction process for
WatchGuard, as many 50 firms, including 18 other private equity
firms, expressed interest in acquiring the company. Defendants
FP and Vector submitted bids and were the only remaining bidders
at the conclusion of the bidding process. Ultimately, however,
Vector dropped out of the auction and reached an agreement with
FP to finance half of the acquisition of WatchGuard in exchange
for a 50% interest in the company. The final accepted offer was
lower than the initial bids of both FP and Vector. The
plaintiff alleged that the lower bid was the result of an
illegal agreement between FP and Vector to refrain from bidding
against each other and to fix the price for the acquisition.
First, in its opinion, the court rejected the plaintiff's claim
that the alleged conspiracy should be treated as per se
unlawful. Per se unlawful treatment under the antitrust laws is
reserved for a narrow class of agreements (e.g., bid rigging,
horizontal price fixing, customer or market allocation) that are
inherently anticompetitive and may be condemned without any
inquiry into their actual anticompetitive effect. Except for
these limited categories, all other alleged unlawful agreements
are evaluated under the rule of reason, which requires the
plaintiff to prove anticompetitive effects. The court in
Pennsylvania Ave. recognized that per se treatment is
appropriate only after courts have had considerable experience
with the type of restraint at issue. According to the court,
"no court has applied the [per se] rule to a price-fixing
agreement in a contest for corporate control." Further, unlike
other agreements that have been treated as per se unlawful, the
agreements involved here were not "uncommon".
In its finding that per se treatment of such joint bidding
arrangements was inappropriate, the court acknowledged that
"price fixing among rival bidders in a contest for corporate
control is not, in general, anticompetitive" and, indeed,
"bidders who join forces can promote rather than suppress
competition." The court noted that joint bidding can be
procompetitive because, among other benefits, it (i) allows
firms -- "poorer contestants" -- that otherwise might not bid to
participate in the auction, thus increasing competition, and
(ii) allows bidders to spread the risk, thus promoting
competition.
The court then undertook a rule of reason analysis which, among
other things, requires the plaintiff to prove anticompetitive
effects. Applying the rule of reason analysis, the court
concluded that the plaintiff had not sufficiently alleged
defendants' market power (e.g., the ability to dictate an
anticompetitive price) within a relevant market, an essential
element under the rule of reason. Even within a narrowly
defined market for corporate control of WatchGuard -- a
questionable finding from the court's perspective -- defendants
had no ability to exercise market power. Two factors were
critical to the court's reasoning. Notwithstanding that FP and
Vector may have been the final two bidders, no inference could
be made that the dozens of other bidders would not have made a
topping bid if they believed that the company was worth more
than the purchase price. In addition, to the extent
shareholders believed that Vector's bid was too low, they could
have rejected it. As the court reasoned, "[t]he illusion of
market power arose not from the Defendants' anticompetitive
conduct, but from the lack of market interest in Watchguard."
Finally, the court declined to adopt the defendants' argument
that the plaintiff's antitrust claims should be dismissed on the
grounds that their alleged conduct is impliedly immune from the
antitrust laws because such conduct is subject to the securities
laws.
According to Mondaq, Pennsylvania Ave. is the first decision
weighing in on an area that has received much public attention.
The case is instructive in that it recognizes that joint bidding
arrangements may be procompetitive and, therefore, should be
evaluated based on their actual competitive effects.
Nevertheless, while the decision is helpful to other courts, it
is not controlling in other districts and may be appealed.
There are legitimate and strong procompetitive justifications
for joint bidding arrangements; however, such conduct may still
raise antitrust sensitivities.
* Milberg Weiss Tops U.S. Class-Action Ranks, Study Says
--------------------------------------------------------
Law firm Milberg Weiss was the top-ranked U.S. class-action firm
for 2007, with $3.8 billion in settlement winnings for
plaintiffs, Reuters notes, citing a new rankings report by
shareholder advisory firm RiskMetrics Group.
Reuters points out that in the RiskMetrics rankings, Milberg
Weiss was first in terms of total dollars won on behalf of
investors based on class-action securities settlements finalized
in 2007. Of the $3.8 billion in pacts the firm negotiated,
about $3.2 billion was from settlements for investors who sued
Tyco International Ltd following an accounting scandal several
years ago that led to the imprisonment of ex-chief Dennis
Kozlowski.
According to Reuters, Milberg Weiss, a specialist in bringing
securities fraud lawsuits against large corporations, had a good
year in terms of settlements despite legal travails of its own
that have hurt its ability to bring in new business.
Reuters relates that Milberg Weiss is set to go on trial in
August this year in the U.S. District Court in Los Angeles on
charges of paying illegal kickbacks to clients. Both the firm
and its co-founder, Melvyn Weiss, have pleaded not guilty to
criminal charges stemming from allegations that they secretly
paid clients illegal kickbacks to plaintiffs in securities fraud
lawsuits.
Law firm Grant & Eisenhofer ranked second in the RiskMetrics
study with $3.45 billion in settlements while Schiffrin Barroway
Topaz & Kessler was third, with $3.33 billion.
Reuters explains that the rankings are based on the firms with
the largest total dollar amount of settlements in which they
served as lead or co-lead counsel.
Milberg Weiss, along with Grant & Eisenhofer and Schiffrin
Barroway all represented the plaintiffs in the Tyco case,
according to the report. Thus, each of the three firms was
credited with the $3.2-billion settlement, under the rankings,
because they were all lead lawyers in the Tyco case.
In fourth place was Coughlin Stoia Geller Rudman & Robbins with
$1.85 billion. One of Coughlin Stoia's founders, William
Lerach, was sentenced to two years in prison in February after
pleading guilty to a conspiracy charge related to paying
kickbacks at Milberg, his former firm. Mr. Lerach retired from
Coughlin Stoia last year and the firm no longer bears his name.
Reuters recounts that Coughlin Stoia was at the top of the
RiskMetrics rankings for 2006, when it collected more than $7.3
billion for investors. About $6.6 billion of that was tied to
Enron-related settlements with several corporate defendants.
Bernstein Litowitz Berger & Grossmann, with $1.34 billion in
total settlements, came in fifth place.
Grant & Eisenhofer had the highest average settlement amount
among the plaintiffs' firms in 2007, averaging $690.3 million in
its five settlements finalized during the year, RiskMetrics
said.
New Securities Fraud Cases
ENERNOC INC: Faces Securities Fraud Lawsuit in Massachusetts
------------------------------------------------------------
Law offices of Brodsky & Smith, LLC announced that a class
action lawsuit has been filed with the United States District
Court for the District of Massachusetts on behalf of all persons
who purchased the common stock of EnerNoc, Inc., between Nov. 1,
2007, and Feb. 27, 2008.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market, thereby artificially inflating
the price of EnerNoc.
For more information, contact:
Evan J. Smith, Esq.
Marc L. Ackerman, Esquire
Brodsky & Smith, LLC
Two Bala Plaza, Suite 602
Bala Cynwyd, PA 19004
Toll free: 877-LEGAL-90
MF GLOBAL: Federman & Sherwood Announces Securities Suit Filing
---------------------------------------------------------------
On March 7, 2008, a class action lawsuit was filed with the
United States District Court for the Southern District of New
York against MF Global, Ltd.
The complaint alleges violations of federal securities laws,
Sections 11, 12 and 15 of the Securities Exchange Act of 1934,
including allegations of issuing a series of materially false
and misleading misrepresentations in connection with the
Company's Registration Statement and Prospectus issued in
connection with the IPO. The class period is from July 19, 2007
through February 28, 2008.
The plaintiff seeks to recover damages on behalf of the Class.
Interested parties may move the court no later than May 9, 2008
for lead plaintiff appointment.
For more information, contact:
K. Lynn Nunn, Esq. (kln@federmanlaw.com)
Federman & Sherwood
10205 North Pennsylvania Avenue
Oklahoma City, OK 73120
Web site: http://www.federmanlaw.com
MF GLOBAL: Faces Securities Fraud Lawsuit in S.D. New York
----------------------------------------------------------
Law offices of Brodsky & Smith, LLC announced that a class
action lawsuit has been filed with the United States District
Court for the Southern District of New York on behalf of all
persons who purchased the common stock of MF Global, LTD. in its
Initial Public Offering on July 19, 2007, and on the open market
through February 28, 2008.
The Complaint alleges that defendants violated federal
securities laws by issuing a series of material
misrepresentations to the market, thereby artificially inflating
the price of MF Global.
For more information, contact:
Evan J. Smith, Esq.
Marc L. Ackerman, Esq.
Brodsky & Smith, LLC
Two Bala Plaza, Suite 602
Bala Cynwyd, PA 19004
Toll free: 877-LEGAL-90
PMI GROUP: Abraham Fruchter Files Securities Fraud Suit in CA
-------------------------------------------------------------
Abraham, Fruchter & Twersky, LLP has filed a class action
lawsuit in the United States District Court for the Northern
District of California on behalf of purchasers of the common
stock of PMI Group, Inc., during the period between Nov. 2,
2006, through March 3, 2008.
PMI is a publicly owned investing holding firm, and through its
subsidiaries, provides credit enhancement products designed to
promote homeownership and facilitate mortgage transactions in
the capital markets of several countries.
The Complaint alleges that during the Class Period, PMI and
certain of its officers and directors violated the federal
securities laws by issuing materially false and misleading
statements regarding PMI's business model and financial
condition, which had the effect of artificially inflating the
market price of the Company's common stock.
As a result of defendants' false statements and concealment, PMI
stock traded at artificially inflated prices during the Class
Period, reaching its Class Period high of $50.21 per share in
February 2007. Then, on March 3, 2008, after the market closed,
PMI announced its preliminary fourth quarter 2007 financial
results and a delay in filing its Form 10-K for year-end 2007
because it was awaiting financial information from an equity
investee, FGIC Corporation, that was necessary for the Company
to complete its financial statements.
On this news, PMI's stock collapsed to $6.43 per share on
March 4, 2008, a one-day decline of 5% and an 87% decline from
its Class Period high in February 2007.
The plaintiffs are seeking to recover damages on behalf of all
purchasers of PMI common stock during the Class Period.
Interested parties may move the court no later than May 11, 2008
for lead plaintiff appointment.
For more information, contact:
Arthur J. Chen, Esq.
Abraham, Fruchter & Twersky, LLP
One Penn Plaza, Suite 2805
New York, New York 10119
Tel.: (212) 279-5050
PMI GROUP: Coughlin Stoia Commences Securities Fraud Suit in CA
---------------------------------------------------------------
Coughlin Stoia Geller Rudman & Robbins LLP announced that a
class action has been commenced in the United States District
Court for the Northern District of California on behalf of
purchasers of The PMI Group, Inc. common stock during the period
between November 2, 2006 and March 3, 2008.
The complaint charges PMI and certain of its officers and
directors with violations of the Securities Exchange Act of
1934.
PMI, through its subsidiaries, provides credit enhancement
products designed to promote homeownership and facilitate
mortgage transactions in the capital markets in the United
States, Australia, New Zealand and the European Union.
The complaint alleges that during the Class Period, defendants
issued materially false and misleading statements regarding the
Company's business and financial results. As a result of
defendants' false statements, PMI stock traded at artificially
inflated prices during the Class Period, reaching its Class
Period high of $50.21 per share in February 2007.
Then, on March 3, 2008, after the market closed, PMI announced
its preliminary fourth quarter 2007 financial results and that
it would be delayed in filing its Form 10-K for year-end 2007
because it was awaiting financial information from an equity
investee, FGIC Corporation, that was necessary for the Company
to complete its financial statements. On this news, PMI's stock
collapsed to $6.43 per share on March 4, 2008, a one-day decline
of 5% and an 87% decline from its Class Period high in February
2007.
According to the complaint, the true facts, which were known by
the defendants but concealed from the investing public during
the Class Period, were as follows:
(a) the Company's investment in FGIC was materially
impaired as FGIC's bond insurance arm, Financial
Guaranty, had significant exposure to defaults on bonds
it insured due to the plunge in value of mortgage debt;
(b) the Company was materially overstating its financial
results by failing to properly value its investment in
FGIC and by failing to write down that investment in a
timely fashion in violation of Generally Accepted
Accounting Principles;
(c) the Company was not adequately accounting for its loss
reserves in violation of GAAP, causing its financial
results to be materially misstated;
(d) the Company failed to engage in proper underwriting
practices for its book of business related to insurance
written in 2005 through most of 2007;
(e) the Company had far greater exposure to anticipated
losses and defaults related to its book of business
related to insurance written in 2005 through most of
2007 than it had previously disclosed;
(f) given the deterioration and the increased volatility in
the subprime market, the Company would be forced to
tighten its standards and stop writing insurance
policies to certain categories of borrowers which would
have a direct material negative impact on its book of
business going forward; and
(g) given the increased volatility in the subprime market,
the Company had no reasonable basis to make projections
about its incurred losses or about its new insurance
written.
The plaintiff seeks to recover damages on behalf of all
purchasers of PMI common stock during the Class Period.
For more information, contact:
Darren Robbins, Esq. (djr@csgrr.com)
Coughlin Stoia Geller Rudman & Robbins LLP
655 West Broadway, Suite 1900
San Diego, CA 92101
Phone: 800-449-4900 or 619-231-1058
SOCIETE GENERALE: Cohen Milstein Files NY Securities Fraud Suit
---------------------------------------------------------------
The law firm Cohen, Milstein, Hausfeld & Toll, P.L.L.C., has
filed a lawsuit in the United States District Court for the
Southern District of New York on behalf of all purchasers of
American Depository Receipts of Societe Generale, traded on the
over the counter market, and all U.S. purchasers of SocGen's
shares on overseas exchanges, between Aug. 1, 2005, and Jan. 23,
2008, inclusive.
The complaint charges that SocGen violated the Securities
Exchange Act of 1934 by misleading investors regarding its
activities and exposure in the subprime mortgage markets, and
its lack of sufficient internal controls and failure to act on
information it had regarding the highly irregular and
unauthorized trades by its Delta One derivative trading desk,
handled by junior trader Jerome Kerviel.
The case also involves alleged insider trading by SocGen's top
U.S. executive and board member, Robert A. Day. Specifically,
the complaint charges that during the Class Period SocGen:
(1) made false and misleading statements and concealed
material adverse information regarding SocGen's
exposure to subprime loans, collateralized debt
obligations and SocGen's internal controls;
(2) touted SocGen's conservative management, risk control,
and expertise in risk analysis and structured finance,
including CDO vehicles;
(3) misled investors by announcing that it had "very little
exposure" to the subprime segment; and
(4) ignored or failed to act upon numerous alerts which
should have led to the uncovering of Jerome Kerviel's
massive irregular trading activity from 2005 through
early 2008.
The Complaint further alleges that the result of this fraudulent
activity was that SocGen had to take write downs of close to
$4 billion relating to the subprime market, and $7 billion in
losses due to the highly risky and irregular trading by Kerviel,
which caused a dramatic drop in share price and significant
losses to investors.
Interested parties may move the court no later than May 12, 2008
for lead plaintiff appointment.
For more information, contact:
Steven J. Toll, Esq. (stoll@cmht.com)
Jonathan Tucker, Esq. (jtucker@cmht.com)
Cohen, Milstein, Hausfeld & Toll, P.L.L.C.
1100 New York Avenue, N.W.
Suite 500, West Tower
Washington, D.C. 20005
Phone: 888-240-0775
202-408-4600
Asbestos Alerts
ASBESTOS LITIGATION: XL Capital Records 1,716 Claims at Dec. 31
---------------------------------------------------------------
XL Capital Ltd had 1,716 open claims filed for potential
asbestos exposures as of Dec. 31, 2007, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 29, 2008.
About 50 percent of the open claim files are due to
precautionary claim notices in 2007 and 2006.
At Dec. 31, 2007, the Company recorded 338 new claims reported
and 69 claims resolved.
Net unpaid losses and loss expenses on asbestos and
environmental exposure claims were US$120,656,000 for the year
ended Dec. 31, 2007, compared with US$112,963,000 for the year
ended Dec. 31, 2006.
Gross unpaid losses and loss expenses on A&E exposure claims
were US$324,848,000 for the year ended Dec. 31, 2007, compared
with US$211,961,000 for the year ended Dec. 31, 2006.
Incurred but not reported losses, net of reinsurance, included
was US$73.1 million in 2007, US$64.1 million in 2006, and
US$16.7 million in 2005.
During 2007, the casualty and other lines favorable development
of US$87.4 million reflects the net result of releases of
US$121.4 million primarily in the U.S. and non-U.S. casualty
portfolios, partially offset by net adverse development of US$13
million associated with the results of an external review of the
Company's asbestos and environmental reserves and US$21 million
related to a commutation of a stop loss reinsurance agreement.
As of Dec. 31, 2006, the Company had about 1,447 open claim
files for potential asbestos exposures and 589 open claim files
for potential environmental exposures on business written before
1986. (Class Action Reporter, March 30, 2007)
Hamilton, Bermuda-based XL Capital Ltd provides global insurance
and reinsurance coverages to industrial, commercial and
professional service firms, insurance companies and other
enterprises on a worldwide basis.
ASBESTOS LITIGATION: Watts Water Faces 100 Cases in Miss., N.J.
---------------------------------------------------------------
Watts Water Technologies, Inc. is a defendant in about 100 cases
filed primarily, but not exclusively, in Mississippi and New
Jersey state courts alleging injury or death as a result of
exposure to asbestos.
These filings typically name multiple defendants and are filed
on behalf of many plaintiffs. They do not identify any
particular Watts products as a source of asbestos exposure.
To date, the Company has been dismissed from each case when the
scheduled trial date comes near or when discovery fails to yield
any evidence of exposure to any of its products.
North Andover, Mass.-based Watts Water Technologies, Inc. makes
valves used in plumbing, heating, and water control
applications. Company products include ball valves, safety
relief valves, pressure regulators, float valves, and drainage
products.
ASBESTOS LITIGATION: W.R. Grace Still Has Damage, Injury Actions
----------------------------------------------------------------
W.R. Grace & Co. continues to be a defendant in property damage
and personal injury lawsuits relating to previously sold
asbestos-containing products, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 29, 2008.
As of the April 2, 2001 bankruptcy Filing Date, the Company was
a defendant in 65,656 asbestos-related lawsuits, 17 involving
claims for property damage (one of which has since been
dismissed), and the remainder involving 129,191 claims for
personal injury.
Due to the Filing, holders of asbestos-related claims are stayed
from continuing to prosecute pending litigation and from
commencing new lawsuits against the Debtors.
The Personal Injury and Property Damage Committees, representing
the interests of property damage and personal injury claimants,
respectively, and the legal representative of future asbestos
claimants (FCR), representing the interests of future personal
injury claimants, have been appointed in the Chapter 11 Cases.
The Company's obligations with respect to present and future
claims will be determined through the Chapter 11 process.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: 460 Damage Claims at Dec. Remain v. Grace
--------------------------------------------------------------
W.R. Grace & Co. states that, as of Dec. 31, 2007, following the
reclassification, withdrawal or expungement of claims, about 460
property damage claims remain outstanding.
As of Sept. 30, 2007, the Company recorded about 460 outstanding
asbestos-related property damage claims, following the
reclassification, withdrawal or expungement of claims. (Class
Action Reporter, Nov. 30, 2007)
The U.S. Bankruptcy Court has approved settlement agreements
covering about 275 property damage claims for an aggregate
allowed amount of US$82 million.
The plaintiffs in asbestos property damage lawsuits generally
seek to have the defendants pay for the cost of removing,
containing or repairing the asbestos-containing materials in the
affected buildings.
Out of 380 asbestos property damage cases (which involved
thousands of buildings) filed before the April 2, 2001
bankruptcy Filing Date, 140 were dismissed without payment of
any damages or settlement amounts. Judgments after trial were
entered in favor of the Company in nine cases (excluding cases
settled following appeals of judgments in favor of the Company).
Judgments after trial were entered in favor of the plaintiffs in
eight cases (one of which is on appeal) for a total of US$86.1
million.
Two hundred seven property damage cases were settled for a total
of US$696.8 million, and 16 cases remain outstanding (including
the one on appeal). Of the 16 remaining cases, eight relate to
Zonolite Attic Insulation, a former attic insulation product,
and eight relate to a number of former asbestos-containing
products (two of which also are alleged to involve ZAI).
About 4,035 additional property damage claims were filed before
the March 31, 2003 claims bar date established by the Bankruptcy
Court.
Eight of the ZAI cases were filed as purported class action
lawsuits in 2000 and 2001. In addition, 10 lawsuits were filed
as purported class actions in 2004 and 2005 with respect to
persons and homes in Canada.
These cases seek damages and equitable relief, including the
removal, replacement and/or disposal of all such insulation. The
plaintiffs assert that this product is in millions of homes and
that the cost of removal could be several thousand dollars per
home. As a result of the Filing, the eight U.S. cases have been
stayed.
The plaintiffs in the ZAI lawsuits (and the U.S. government in a
Montana criminal proceeding) dispute the Company's position on
the safety of ZAI.
On Oct. 18, 2004, the Bankruptcy Court held a hearing on motions
filed by the parties to address a number of important legal and
factual issues regarding the ZAI claims. On Dec. 14, 2006, the
Bankruptcy Court issued an opinion and order holding that,
although ZAI is contaminated with asbestos and can release
asbestos fibers when disturbed, there is no unreasonable risk of
harm from ZAI.
The ZAI claimants sought an interlocutory appeal of the opinion
and order with the District Court in Delaware but that request
was denied. The ZAI claimants have indicated they still intend
to appeal such opinion and order when it becomes a final order.
The Bankruptcy Court has instructed the parties to consult with
one another regarding how to proceed with respect to ZAI in
light of the Court's opinion and order. The Company's recorded
asbestos-related liability at Dec. 31, 2007 assumes the risk of
loss from ZAI litigation is not probable.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: Personal Injury Cases Pending v. W.R. Grace
----------------------------------------------------------------
W.R. Grace & Co. continues to face asbestos personal injury
cases, in which claimants allege adverse health effects from
exposure to asbestos-containing products formerly manufactured
by the Company.
Cumulatively through the April 2, 2001 bankruptcy Filing Date,
16,354 asbestos personal injury lawsuits involving about 35,720
claims were dismissed without payment of any damages or
settlement amounts (primarily on the basis that Grace products
were not involved) and about 55,489 lawsuits involving about
163,698 claims were disposed of (through settlements and
judgments) for a total of US$645.6 million.
As of the Filing Date, 129,191 claims for personal injury were
pending against the Company.
The Company said it believes that a substantial number of
additional personal injury claims would have been received
between the Filing Date and Dec. 31, 2007 had such claims not
been stayed by the Bankruptcy Court.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: Grace Records $917M of Coverage at Dec. 31
---------------------------------------------------------------
W.R. Grace & Co. states that, as of Dec. 31, 2007, there remains
about US$917 million of asbestos-related excess coverage from 54
presently solvent insurers, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 29, 2008.
The Company holds insurance policies that provide coverage for
1962 to 1984 with respect to asbestos-related lawsuits and
claims. For the most part, coverage for 1962 through 1972 has
been exhausted, leaving coverage for 1973 through 1985 available
for pending and future asbestos claims. Since 1985, insurance
coverage for asbestos-related liabilities has not been
commercially available to the Company.
For each insurance year, the Company's coverage consists of both
primary and excess coverage.
The Company has entered into settlement agreements with various
excess insurance carriers. These settlements involve amounts
paid and to be paid to the Company. The unpaid maximum aggregate
amount available under these settlement agreements is about
US$487 million.
Presently, the Company has no agreements in place with insurers
with respect to about US$430 million of excess coverage. Such
policies are at layers of coverage that have not yet been
triggered, but certain layers would be triggered if the Debtors
Plan were approved at the recorded asbestos-related liability of
US$1.7 billion. In addition, the Company has about US$253
million of excess coverage with insolvent or non-paying
insurance carriers.
In November 2006, the Company entered into a settlement
agreement with an underwriter of a portion of its excess
insurance coverage. The insurer paid a settlement amount of
US$90 million directly to an escrow account for the benefit of
the holders of claims for which Grace was provided coverage
under the affected policies.
The escrow account balance was about US$94.8 million at Dec. 31,
2007, compared with US$90.3 million at Dec. 31, 2006, including
interest earned on the account.
Funds will be distributed from this account directly to
claimants at the direction of the escrow agent under the terms
of a confirmed plan of reorganization or as otherwise ordered by
the Bankruptcy Court.
The settlement agreement provides that unless the Company
confirms a plan of reorganization by Dec. 31, 2008, at the
option of the insurer, exercisable at any time prior to
April 30, 2009, the escrow amount with interest must be returned
to the insurer.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: W.R. Grace's Libby Liability Totals $270.8M
----------------------------------------------------------------
W.R. Grace & Co.'s total estimated liability for asbestos
remediation related to its former vermiculite operations in
Libby, including the cost of remediation at vermiculite
processing sites outside of Libby, Mont., was US$270.8 million,
excluding interest, at Dec. 31, 2007, compared with US$255.2
million at Dec. 31, 2006.
The estimated obligation as of each date includes US$162.5
million for asserted reimbursable costs through 2005 (which
includes the US$54.5 million charge).
The estimate as of each date does not include the cost to
remediate the Company-owned mine site at Libby or other nearby
properties that may require remediation, which costs are not
currently estimable.
The Company's estimate of costs is based on information
exchanged with the U.S. Environmental Protection Agency in the
first quarter of 2008.
As a result of a 2002 U.S. District Court ruling, the Company is
required to reimburse the U.S. Government for US$54.5 million
(plus interest) in costs expended through December 2001, and for
all appropriate future costs to complete asbestos-related
remediation relating to the Company's former vermiculite mining
and processing activities in the Libby area.
These costs include cleaning and/or demolition of contaminated
buildings, excavation and removal of contaminated soil, health
screening of Libby residents and former mine workers, and
investigation and monitoring costs.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: Grace to Appeal 9th Circuit Ruling in Suit
---------------------------------------------------------------
W.R. Grace & Co. has yet to appeal to the Supreme Court a ruling
of the 9th Circuit Court of Appeals over a lawsuit on the
Company's former vermiculite mining and processing activities in
Libby, Mont.
On Feb. 7, 2005, the U.S. Department of Justice announced the
unsealing of a grand jury indictment against the Company and
seven former senior level employees on the Libby activities.
The case is styled United States of America v. W. R. Grace & Co.
et al.
The indictment accuses the defendants of (1) conspiracy to
violate environmental laws and obstruct federal agency
proceedings; (2) violations of the federal Clean Air Act; and
(3) obstruction of justice.
The Company purchased the Libby mine in 1963 and operated it
until 1990; vermiculite processing activities continued until
1992. The grand jury charges that the conspiracy took place from
1976 to 2002.
According to the U.S. Department of Justice, the Company could
be subject to fines in an amount equal to twice the after-tax
profit earned from its Libby operations or twice the alleged
loss suffered by victims, plus additional amounts for
restitution to victims. The indictment alleges that such after-
tax profits were US$140 million. The Company has categorically
denied any criminal wrongdoing.
In July 2006, the U.S. District Court for the District of
Montana dismissed a portion of the conspiracy count of a
superseding indictment alleging conspiracy to knowingly endanger
residents of the Libby area and others in violation of the Clean
Air Act.
In August 2006, the District Court granted a motion by the
defendants to exclude as evidence sample results that included
minerals that do not constitute asbestos under the Clean Air
Act. The Government appealed these and other rulings to the 9th
Circuit Court of Appeals.
In September 2007, the 9th Circuit overturned the July 2006 and
August 2006 District Court rulings. In December 2007, the
Company's petition for rehearing concerning these rulings was
denied.
The Company intends to appeal the 9th Circuit's ruling to the
Supreme Court. A trial date has not yet been scheduled.
The U.S. Bankruptcy Court previously granted the Company's
request to advance legal and defense costs to the employees
involved in this case, subject to a reimbursement obligation if
it is later determined that the employees did not meet the
standards for indemnification set forth under the appropriate
state corporate law.
For the years ended Dec. 31, 2007, 2006, and 2005, total expense
for the Company and the employees was US$19 million, US$52.7
million, and US$20 million, respectively, which amounts are
included in selling, general and administrative expenses in the
accompanying Consolidated Statements of Operations.
Cumulative expenses to address this matter were US$91.7 million
through Dec. 31, 2007.
While the appeal is pending, the Company expects legal fees for
this matter to be US$3 million to US$4 million per quarter.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: NJDEP Action v. Grace, 2 Ex-Workers Ongoing
----------------------------------------------------------------
An asbestos-related environmental action filed by the New Jersey
Department of Environmental Protection against W.R. Grace & Co.
and two former employees is ongoing in the Superior Court of New
Jersey Law Division: Mercer County.
The case is styled N.J. Dept. of Environmental Protection v.
W.R. Grace & Co. et al.
Filed on June 1, 1005, the suit seeks civil penalties for
alleged misrepresentations and false statements made in a
Preliminary Assessment/Site Investigation Report and Negative
Declarations submitted by the Company to the DEP in 1995 under
the New Jersey Industrial Site Recovery Act.
The Company submitted the report, which was prepared by an
independent environmental consultant, in connection with the
closing of the Company's former plant in Hamilton Township, N.J.
The State of New Jersey and the U.S. Department of Justice also
have conducted criminal investigations related to the Company's
former operations of the Hamilton plant, but the Company is not
aware of any recent activity related to such investigations.
The Company purchased the Hamilton plant assets in 1963 and
ceased operations in 1994. During the operating period, it
produced spray-on fire protection products and other
vermiculite-based products at this plant. The current property
owners are conducting remediation activities as directed by the
U.S. Environmental and Protection Agency.
The property owners and the EPA have filed proofs of claim
against the Company seeking about US$4.2 million with respect to
the Hamilton plant site, which is contemplated as part of the
multi-site settlement agreement.
In August 2007, the Bankruptcy Court denied the State of New
Jersey's motion for leave to file a late proof of claim in the
amount of US$31 million. This ruling, which the State of New
Jersey has appealed, does not affect the claims against the
former employees, for which the Company would have an
indemnification obligation.
Columbia, Md.-based W.R. Grace & Co. is engaged in the
production and sale of specialty chemicals and specialty
materials on a global basis through its two operating segments,
Grace Davison and Grace Construction Products. The Company
entered the specialty chemicals industry in 1954, when it
acquired both the Dewey and Almy Chemical Company and the
Davison Chemical Company.
ASBESTOS LITIGATION: Supreme Court Favors CNA in Lautenschuetz
--------------------------------------------------------------
The Supreme Court, Appellate Division, 3rd Department, New York,
reversed a Supreme Court ruling, entered Aug. 17, 2007 in
Clinton County, that granted Lee Ann Lautenschuetz's application
under Workers' Compensation Law ss 29(5) for judicial approval,
nunc pro tunc, of an asbestos personal injury settlement.
The case is styled In the Matter of Lee Anne Lautenschuetz,
Individually and as Administrator of the Estate of Gary E.
Lautenschuetz, Deceased, Respondent, v. AP Greene Industries,
Inc., et al., Defendants, and CNA Insurance Company, Appellant.
Judges Cardona, Peters, Spain, and Kane entered judgment of the
case on Feb. 21, 2008.
In 2002, Gary E. Lautenschuetz commenced a personal injury
action seeking damages for injuries he sustained from the
inhalation of asbestos. He also filed a disability claim for
workers' compensation benefits and, when he died from
mesothelioma in September 2003, Mrs. Lautenschuetz filed a death
claim.
These claims involved numerous work sites and multiple
employers. However, in September 2005, CNA Insurance was
identified as the liable workers' compensation carrier and
awards were eventually made.
In addition, between December 2003 and April 2007, Mrs.
Lautenschuetz entered into about 15 settlements in the personal
injury action.
In November 2005, CNA applied to the Workers' Compensation Board
for review of the compensation awards made to Mrs.
Lautenschuetz, challenging them on the ground that CNA's consent
was never obtained for the settlements in the personal injury
action.
By decision dated June 8, 2006, the Board, finding insufficient
evidence before it regarding the settlements in the plenary
action, held the matter in abeyance and directed Mrs.
Lautenschuetz to produce further documentation related to the
settlements, including "any [nunc pro tunc] orders previously or
hereinafter obtained."
By order to show cause dated April 19, 2007, Mrs. Lautenschuetz
applied for judicial approval of the settlements nunc pro tunc
from Supreme Court where the personal injury action was pending.
Supreme Court granted the requested approval over the opposition
of CNA. CNA appealed.
In light of Mrs. Lautenschuetz's failure to demonstrate that the
delay resulted from anything other than her own neglect, her
application for nunc pro tunc approval of the July 2006
settlement, as well as all settlements prior thereto, should be
denied.
Ordered that the order is modified, on the law, without costs,
by reversing so much thereof as granted nunc pro tunc approval
of all the settlements except the April 2007 settlement, and, as
so modified, affirmed.
Sullivan, Cunningham, Keenan, Mraz, Oliver & Violando, L.L.P.,
Albany, N.Y. (Michael D. Violando of counsel), represented CNA
Insurance Company.
Weitz & Luzenberg, New York City (Stephen J. Riegel of counsel),
represented Lee Ann Lautenschuetz.
ASBESTOS LITIGATION: Transatlantic Records $124M for A&E Claims
---------------------------------------------------------------
Transatlantic Holdings, Inc.'s net loss reserves include amounts
for risks relating to environmental impairment and asbestos-
related illnesses totaling US$124 million at Dec. 31, 2007 and
Dec. 31, 2006, according to the Company's annual report filed
with the U.S. Securities and Exchange Commission on Feb. 28,
2008.
The US$124 million includes US$25 million at Dec. 31, 2007
(US$30 million at Dec. 31, 2006) relating to A&E losses
occurring in 1985 and prior.
As Transatlantic Reinsurance Company, the Company's major
operating subsidiary, commenced operations in 1978, the great
majority of the Company's environmental and asbestos-related
liabilities arose from contracts entered into after 1985 that
were underwritten specifically as environmental or asbestos-
related coverages rather than as standard general liability
coverages, where the environmental or asbestos-related
liabilities were neither clearly defined nor specifically
excluded.
The reserves carried for these claims, including incurred but
not reported, are based upon known facts and current law.
New York-based Transatlantic Holdings, Inc. operates through its
principal subsidiary, Transatlantic Reinsurance, and its main
operating units, primarily Putnam Reinsurance and Trans Re
Zurich. The group of companies offer reinsurance for
property/casualty products, including general liability, medical
malpractice, architects' and engineers liability, automobile
liability, and surety lines.
ASBESTOS LITIGATION: Union Pacific Cites $265M Liability at Dec.
----------------------------------------------------------------
Union Pacific Corporation's long-term asbestos-related liability
was US$265 million at Dec. 31, 2007, compared with US$302
million at Dec. 31, 2006, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
The Company's long-term asbestos-related liability totaled
US$272 million in the nine months ended Sept. 30, 2007, compared
with US$304 million in the nine months ended Sept. 30, 2006.
(Class Action Reporter, Nov. 2, 2007)
The Company's current asbestos-related liability was US$11
million at Dec. 31, 2007, compared with US$13 million at Dec.
31, 2006.
Asbestos-related payments were US$17 million at Dec. 31, 2007,
compared with US$9 million at Dec. 31, 2006.
The Company is a defendant in a number of lawsuits in which
current and former employees and other parties allege exposure
to asbestos. In 2004, the Company engaged a third party with
extensive experience in estimating resolution costs for
asbestos-related claims to assist the Company in assessing its
potential liability.
In 2007, the Company updated its potential liability to include
actual claim experience since 2004. As a result of this
reassessment, the Company decreased its liability by US$20
million in 2007 for both asserted and unasserted asbestos-
related claims through 2034.
About 13 percent of the recorded liability related to asserted
claims and about 87 percent related to unasserted claims. These
claims are expected to be paid out over the next 27 years.
In conjunction with the liability update performed in 2007, the
Company also reassessed estimated insurance recoveries. The
Company has recognized an asset for estimated insurance
recoveries at Dec. 31, 2007 and Dec. 31, 2006.
At Dec. 31, 2007, the Company recorded 269 new claims filed, 460
claims settled or dismissed, and 2,086 open claims.
At Dec. 31, 2006, the Company recorded 316 new claims filed, 474
claims settled or dismissed, and 2,277 open claims.
Omaha, Nebr.-based Union Pacific Corporation's principal
operating company, Union Pacific Railroad Company, links 23
states in the western two-thirds of the country and serves the
fastest-growing U.S. population centers. Union Pacific Railroad
Company's business mix includes agricultural products,
automotive, chemicals, energy, industrial products, and
intermodal.
ASBESTOS LITIGATION: Selective Insurance Records 2,177 Claims
-------------------------------------------------------------
Selective Insurance Group, Inc. recorded 2,177 asbestos-related
claims at Dec. 31, 2007, compared with 2,273 claims at Dec. 31,
2006, according to the Company's annual report filed with the
U.S. Securities and Exchange Commission on Feb. 28, 2008.
In 2007, the Company recorded 114 claims received during the
year and 210 claims closed during the year. In 2006, the Company
recorded 358 claims received during the year and 174 claims
closed during the year.
The Company's gross reserves for losses and loss expenses were
US$14,955,000 at Dec. 31, 2007, compared with US$14,164,000 at
Dec. 31, 2006.
The Company's net reserves for losses and loss expenses were
US$13,655,000 at Dec. 31, 2007, compared with US$12,863,000 at
Dec. 31, 2006.
Branchville, N.J.-based Selective Insurance Group, Inc. offers
property and casualty insurance products and diversified
insurance services and products. The Company classifies its
business into three operating segments: Insurance Operations,
Investments, and Diversified Insurance Services.
ASBESTOS LITIGATION: Safeco Reserves $227.8M for Claims at Dec.
---------------------------------------------------------------
Safeco Corporation's loss and allocated loss adjustment expenses
reserves before reinsurance was US$227.8 million for asbestos
claims in the year ended Dec. 31, 2007, compared with US$206.3
million in the year ended Dec. 31, 2006.
Asbestos reserves, net of reinsurance, were US$189 million in
the year ended Dec. 31, 2007, compared with US$171 million in
the year ended Dec. 31, 2006.
Asbestos-related loss and ALAE payments, before reinsurance, was
US$22.4 million in the year ended Dec. 31, 2007, compared with
US$14.4 million in the year ended Dec. 31, 2006. Loss and ALAE
payments, net of reinsurance, was US$18.2 million in the year
ended Dec. 31, 2007, compared with US$13.8 million in the year
ended Dec. 31, 2006.
The gross three-year survival ratio was 13.9 percent in the year
ended Dec. 31, 2007, compared with 15 percent in the year ended
Dec. 31, 2006. The net three-year survival ratio was 13.1
percent in the year ended Dec. 31, 2007, compared with 13.2
percent in the year ended Dec. 31, 2006.
In the year ended Dec. 31, 2007, the Company had 2,951 open
claims, the average paid per closed claim was US$29,380, and the
average case reserve per open claim was US$43,137.
In the year ended Dec. 31, 2006, the Company had 3,047 open
claims, the average paid per closed claim was US$30,648, and the
average case reserve per open claim was US$44,997.
The Company's 2007 underwriting results included US$12.9 million
of unfavorable prior-year reserve development in 2007, primarily
related to reserve increases for asbestos exposure claims and
for allegations against religious institutions, partially offset
by reduced estimates for construction defects.
In 2006, US$50.3 million of unfavorable prior-year reserve
development was primarily related to asbestos claims and
allegations against religious institutions.
In 2005, US$48.2 million of unfavorable prior-year reserve
development was primarily driven by reserve increases in assumed
reinsurance and asbestos and environmental claims, partially
offset by favorable construction defects reserve development.
Seattle-based Safeco Corporation is licensed to provide property
and casualty insurance along with related services to
individuals and small- to mid-size businesses in all 50 states
through its insurance subsidiaries. As Feb. 15, 2008, the
Company had 7,057 employees located throughout the United
States.
ASBESTOS LITIGATION: Exposure Suits Pending v. Olin Corporation
---------------------------------------------------------------
Olin Corporation and its subsidiaries are defendants in various
legal actions (including proceedings based on alleged exposures
to asbestos) incidental to its past and current business
activities.
No other matters were disclosed in the Company's annual report
filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
Clayton, Mo.-based Olin Corporation is a manufacturer
concentrated in two business segments: Chlor Alkali Products and
Winchester. Chlor Alkali Products manufactures and sells
chlorine and caustic soda, sodium hydrosulfite, hydrochloric
acid, hydrogen, sodium chlorate, bleach products and potassium
hydroxide. Winchester products, which represent 34 percent of
2007 sales, include sporting ammunition, reloading components,
small caliber military ammunition and components, and industrial
cartridges.
ASBESTOS LITIGATION: Suits v. MeadWestvaco Drop to 350 at Dec.
--------------------------------------------------------------
Asbestos-related lawsuits against MeadWestvaco Corporation
dropped to 350 as of Dec. 31, 2007, from 400 as of Sept. 30,
2007, according to the Company's annual report filed with the
U.S. Securities and Exchange Commission on Feb. 28, 2008.
As with numerous other large industrial companies, the Company
has been named a defendant in asbestos-related personal injury
litigation. Typically, these suits also name many other
corporate defendants.
All of the claims against the Company resolved to date have been
concluded before trial, either through dismissal or through
settlement with payments to the plaintiff that are not material
to the Company.
To date, the costs resulting from the litigation, including
settlement costs, have not been significant.
At Dec. 31, 2007, the Company had recorded litigation
liabilities of about US$19 million, a significant portion of
which relates to asbestos.
Glen Allen, Va.-based MeadWestvaco Corporation provides
packaging solutions to international brands in the food and
beverage, media and entertainment, personal care, home and
garden, cosmetics, and health care industries and operates in
more than 30 countries. The Company's business segments are: (i)
Packaging Resources, (ii) Consumer Solutions, (iii) Consumer &
Office Products, and (iv) Specialty Chemicals.
ASBESTOS LITIGATION: Lawsuits Still Pending v. Lockheed Martin
--------------------------------------------------------------
Like many other industrial companies in recent years, Lockheed
Martin Corporation is a defendant in lawsuits alleging personal
injury as a result of exposure to asbestos integrated into its
premises and certain historical products.
The Company has never mined or produced asbestos and no longer
incorporates it in any currently manufactured products. The
Company has been successful in having a substantial number of
these claims dismissed without payment.
The remaining resolved claims have settled for amounts that are
not material individually or in the aggregate. A substantial
majority of the asbestos-related claims have been covered by
insurance or other forms of indemnity.
Bethesda, Md.-based Lockheed Martin Corporation principally
researches, designs, develops, manufactures, integrates,
operates and sustains advanced technology systems and products,
and provides a broad range of management, engineering,
technical, scientific, logistic and information services.
ASBESTOS LITIGATION: 103T Open Claims Pending v. ITT at Dec. 31
---------------------------------------------------------------
About 103,000 open asbestos-related claims were pending against
ITT Corporation as of Dec. 31, 2007, down 8,000 from the prior
year, according to the Company's annual report filed with the
U.S. Securities and Exchange Commission on Feb. 28, 2008.
The Company, including its subsidiary Goulds Pumps, Inc., has
been joined as a defendant with numerous other industrial
companies in product liability lawsuits alleging injury due to
asbestos. These claims stem primarily from products sold before
1985 that contained a part manufactured by a third party, e.g.,
a gasket, which allegedly contained asbestos.
The asbestos was encapsulated in the gasket (or other) material
and was non-friable. In certain other cases, it is alleged that
former ITT companies were distributors for other manufacturers'
products that may have contained asbestos.
Frequently, the plaintiffs are unable to demonstrate any injury
or do not identify any ITT or Goulds product as a source of
asbestos exposure.
During 2007, the Company resolved about 12,200 claims. Nearly
all of these claims were dismissed, with settlement on a small
percentage of claims.
The Company's estimated accrued costs, net of expected insurance
recoveries, for the resolution of all of these pending claims
were US$24.8 million as of Dec. 31, 2007, compared with US$21.8
as of Dec. 31, 2006.
The Company is involved in two actions, Cannon Electric, Inc. et
al. v. Ace Property & Casualty Company (ACE) et al. Superior
Court, County of Los Angeles, Calif., Case No. BC 290354, and
Pacific Employers Insurance Company et al., v. ITT Industries,
Inc., et al., Supreme Court, County of New York, N.Y., Case No.
03600463.
The parties in both cases seek an appropriate allocation of
responsibility for the Company's historic asbestos liability
exposure among its insurers. The California action is filed in
the same venue where the Company's environmental insurance
recovery litigation had been pending since 1991. The New York
action has been stayed in favor of the California suit.
The Company and ACE and Nationwide Indemnity have successfully
resolved the matter and the Company is working with other
parties in the suit to resolve the matter as to those insurers.
In addition, Utica National and Goulds have negotiated a
coverage-in-place agreement to allocate the Goulds asbestos
liabilities between insurance policies issued by Utica and those
issued by others. The terms of the settlement provide Goulds
with substantial coverage from Utica for asbestos liabilities.
White Plains, N.Y.-based ITT Corporation, with 2007 sales and
revenues of about US$9 billion, is a global multi-industry
company engaged directly and through its subsidiaries in the
design and manufacture of a wide range of engineered products
and related services.
ASBESTOS LITIGATION: Illinois Tool, Units Face Welding Lawsuits
---------------------------------------------------------------
Illinois Tool Works Inc. as well as its subsidiaries Hobart
Brothers Company and Miller Electric Mfg. Co., have been named,
along with numerous other defendants, in lawsuits alleging
injury from exposure to welding consumables.
The plaintiffs in these suits claim unspecified damages for
injuries resulting from the plaintiffs' alleged exposure to
asbestos, manganese and/or toxic fumes in connection with the
welding process.
The Company has not recorded any significant reserves related to
these cases.
No other matters were disclosed in the Company's annual report
filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
Glenview, Ill.-based Illinois Tool Works Inc. is a multinational
manufacturer of a diversified range of industrial products and
equipment with about 825 operations in 52 countries.
ASBESTOS LITIGATION: Injury Lawsuit Ongoing v. California Water
---------------------------------------------------------------
California Water Service Group and a number of co-defendants
face a complaint filed in the Superior Court County of Los
Angeles, Case No. BC360406, for personal injury allegedly caused
by exposure to asbestos.
The plaintiff claims to have worked for three of the Company's
contractors on pipeline projects during the period 1958-1999,
including Palos Verdes Water Company, a water utility the
Company acquired in 1970.
The plaintiff alleges that the Company and other defendants are
responsible for his asbestos-related injuries. On April 20,
2007, the Superior Court sustained the Company's demurrer
without leave to amend all Plaintiff's claims alleging products
liability and intentional torts.
The Court also sustained the Company's demurrer with leave to
amend Plaintiff's claim for premise owner contractor liability,
a negligence claim, alleging misconduct that may allow for
punitive damages (Premise/Owner Claim) and severed the Company
from the accelerated trial with other named defendants.
On July 3, 2007, the Court sustained the Company's demurrer with
leave to amend the Plaintiff's third amended complaint alleging
the Premise/Owner Claim. Plaintiff filed a fourth amended
complaint restating the Premise/Owner Claim.
The Court overruled the Company's demurrer on the Plaintiff's
fourth amended complaint, but the Court sustained the Company's
motion to strike punitive damages.
The Company has filed a motion for summary judgment, which is
scheduled to be heard by the Court on Feb. 28, 2008.
Under the plaintiff's remaining cause of action, the Company
said it does not believe that a liability is probable, and the
Company can not reasonably estimate any liability amount at this
time.
The Company used asbestos cement pipe and fittings, which were
widely used in the water industry and permitted for such use by
regulatory agencies, and the Company hired qualified contractors
to install the pipe and fittings in accordance with laws and
regulations at the time.
San Jose, Calif.-based California Water Service Group's main
subsidiary, regulated utility California Water Service Company
(Cal Water), provides water in 26 systems for 460,900 customers
throughout California. Cal Water obtains its water from wells
and wholesale suppliers.
ASBESTOS LITIGATION: Summary Judgment Decision Reversed in Horak
----------------------------------------------------------------
The Court of Appeals of Wisconsin reversed the ruling of the
Circuit Court for Milwaukee County, that had granted summary
judgment in favor of Building Services Industrial Sales Company,
in an asbestos-related lawsuit filed by Cindy Horak on behalf of
her father, George Benzinger.
Judges Brown, Wedemeyer, and Fine entered judgment of Case No.
2007AP735 on Feb. 20, 2008.
Mr. Benzinger worked for Jaeger Insulation Company or its
predecessor for many years, including 1961 through 1965. One of
his surviving co-workers during part of that time testified at
his deposition that three or four persons worked for Jaeger,
noting that it was not "that big of a company." He could,
however, only remember two-- Mr. Benzinger and another, both of
whom were deceased.
Jaeger went out of business, apparently in the late 1980s. Mr.
Benzinger died before he could either testify at a deposition or
otherwise preserve whatever evidence he might have had material
to this case.
As the Appeals Court noted, Mrs. Horak focused on Mr.
Benzinger's work for Jaeger or its predecessor from 1961 through
1965 because there is evidence that Building Services sold
asbestos to Jaeger or its predecessor during that four-year
period.
As the circuit court recognized, Jaeger "had small jobs,"
Building Services sold a significant amount of asbestos products
to Jaeger or its predecessor during that time, and it is not
disputed that Mr. Benzinger installed asbestos insulation on
various Jaeger job-sites.
Mrs. Horak appealed the summary-judgment order dismissing its
complaint against Building Services, which had supplied asbestos
material to Jaeger or its predecessor.
The circuit court determined that Mrs. Horak did not satisfy her
summary-judgment burden to show that there were genuine issues
of fact as to whether Building Services' supply of asbestos to
Jaeger or its predecessor was a cause of Mr. Benzinger's cancer
because, according to the circuit court, Mrs. Horak was unable
to show that Mr. Benzinger actually worked with Building
Services' asbestos.
The appeals court reversed the ruling and the cause was
remanded.
ASBESTOS LITIGATION: Third-Party Actions Pending v. Badger Meter
----------------------------------------------------------------
Badger Meter, Inc. continues to face multi-claimant/multi-
defendant lawsuits alleging personal injury as a result of
exposure to asbestos, manufactured by third parties, and
integrated into a very limited number of the Company's
industrial products.
The Company states that no claimant has demonstrated exposure to
products manufactured or sold by the Company and that a number
of cases have been voluntarily dismissed.
No other such matters were disclosed in the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
Milwaukee-based Badger Meter, Inc. is a manufacturer and
marketer of products incorporating liquid flow measurement and
control technologies serving markets worldwide. The Company was
incorporated in 1905.
ASBESTOS LITIGATION: Hercules Incurs $5.7M for Legal Fees in '07
----------------------------------------------------------------
Hercules Incorporated, during 2007, incurred net charges of
US$5.7 million attributable to legal fees for asbestos-related
litigation costs, net of interest accretion from the asbestos
insurance trusts and a downward adjustment to an asbestos
litigation reserve as determined by an independent reserve
study.
With respect to its asbestos litigation obligations, the Company
has total dedicated assets of US$28.1 million available as of
Dec. 31, 2007 to fund asbestos-related settlements and defense
costs.
During 2008, the Company anticipates the total cash requirements
for asbestos-related litigation matters to be about US$38
million. Of the total, about US$28 million is projected for
settlements and US$10 million is projected for defense costs.
Wilmington, Del.-based Hercules Incorporated is a manufacturer
and marketer of specialty chemicals and related services for
business, consumer and industrial applications. The Company
operates on a global scale, with operations in North America,
Europe, Asia and Latin America. Product sales occur in over 135
countries with significant revenue streams generated on five
continents.
ASBESTOS LITIGATION: Hercules Records $227M Liability at Dec. 31
----------------------------------------------------------------
Hercules Incorporated's long-term asbestos-related liabilities
were US$227 million as of Dec. 31, 2007, compared with US$233.6
million as of Dec. 31, 2006, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
The Company's long-term asbestos-related liabilities amounted to
US$235.9 million as of Sept. 30, 2007. (Class Action Reporter,
Nov. 9, 2007)
The Company's current asbestos-related liabilities were US$28
million as of Dec. 31, 2007, compared with US$36.4 million as of
Dec. 31, 2006.
The Company's current asbestos-related liabilities amounted to
US$22 million as of Sept. 30, 2007. (Class Action Reporter,
Nov. 9, 2007)
Long-term asbestos-related assets were US$24.1 million as of
Dec. 31, 2007, compared with US$87.5 million as of Dec. 31,
2006.
The Company's long-term asbestos-related assets amounted to
US$30.4 million as of Sept. 30, 2007. (Class Action Reporter,
Nov. 9, 2007)
As of Dec. 31, 2007, the Company's current asbestos-related
assets were US$4 million.
Wilmington, Del.-based Hercules Incorporated is a manufacturer
and marketer of specialty chemicals and related services for
business, consumer and industrial applications. The Company
operates on a global scale, with operations in North America,
Europe, Asia and Latin America. Product sales occur in over 135
countries with significant revenue streams generated on five
continents.
ASBESTOS LITIGATION: Claims v. Hercules Drop to 25,562 at Dec.
--------------------------------------------------------------
Hercules Incorporated, as of Dec. 31, 2007, recorded about
25,562 unresolved asbestos-related claims, of which about 925
were premises claims and the rest were products claims,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 28, 2008.
As of Sept. 30, 2007, the Company recorded about 25,780
unresolved asbestos-related claims, of which about 920 were
premises claims and the rest were products claims. (Class Action
Reporter, Nov. 9, 2007)
The Company faces asbestos-related personal injury lawsuits and
claims which typically arise from alleged exposure to asbestos
fibers from resin encapsulated pipe and tank products which were
sold by one of the Company's former subsidiaries to a limited
industrial market (products claims).
The Company also faces lawsuits alleging exposure to asbestos at
facilities formerly or presently owned or operated by the
Company (premises claims).
There were also about 1,885 unpaid claims which have been
settled or are subject to the terms of a settlement agreement.
Between Jan. 1, 2007 and Dec. 31, 2007, the Company received
about 1,130 new claims. During that same period, the Company
spent US$24.9 million to resolve and defend asbestos matters,
including US$15.8 million directly related to settlement
payments and US$9.1 million for defense costs.
In 2002, the Company commenced litigation against its excess
insurance carriers seeking coverage for the Company's asbestos-
related liabilities. In 2004, that litigation was resolved
through several settlements, resulting in recoveries from some
insurers, and agreements with other insurers to cover certain of
these liabilities in the future.
As of Dec. 31, 2007, all of the cash recovered and all of the
monies placed into trust have been used by the Company with
respect to these liabilities or for other corporate purposes,
except for about US$24 million remaining in trust and to be paid
into trust during the first quarter of 2008.
With respect to the agreements reached to cover these
liabilities in the future, effective Oct. 13, 2004, the Company
reached a confidential settlement agreement with its remaining
solvent excess insurers whereby a significant portion of the
costs incurred by the Company with respect to future asbestos
product liability claims will be reimbursed, subject to those
claims meeting certain qualifying criteria (the "Future Coverage
Agreement").
The Company has decreased the reasonably possible exposure for
asbestos-related matters as of Dec. 31, 2007 to a range of
US$255 million to US$750 million (as compared with the prior
range of US$270 million to US$770 million).
Wilmington, Del.-based Hercules Incorporated is a manufacturer
and marketer of specialty chemicals and related services for
business, consumer and industrial applications. The Company
operates on a global scale, with operations in North America,
Europe, Asia and Latin America. Product sales occur in over 135
countries with significant revenue streams generated on five
continents.
ASBESTOS LITIGATION: Exposure Suits Still Pending v. CenterPoint
----------------------------------------------------------------
CenterPoint Energy, Inc. and its subsidiaries continue to be
named as defendants in lawsuits filed by a number of individuals
who claim injury due to exposure to asbestos, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 28, 2008.
Some of the claimants have worked at locations owned by the
Company, but most existing claims relate to facilities
previously owned by the Company's subsidiaries. The Company
anticipates that more claims like those received may be asserted
in the future.
In 2004, the Company sold its generating business, to which most
of these claims relate, to Texas Genco LLC, which is now known
as NRG Texas LP.
Under the terms of the arrangements regarding separation of the
generating business from the Company and its sale of this
business to Texas Genco LLC, ultimate financial responsibility
for uninsured losses from claims relating to the generating
business has been assumed by Texas Genco LLC and its successor,
but the Company has agreed to continue to defend such claims to
the extent they are covered by insurance the Company maintains,
subject to reimbursement of the costs of such defense from the
purchaser.
CenterPoint Energy, Inc.'s (formerly Reliant Energy) regulated
utilities distribute natural gas and electricity to more than
five million customers in six states, primarily in the southern
U.S. The Company also operates 7,900 miles of gas pipeline, and
it has gas gathering and storage operations. The Company's main
stomping ground is Texas.
ASBESTOS LITIGATION: Chicago Bridge Faces 1,900 Suits at Dec. 31
----------------------------------------------------------------
Chicago Bridge & Iron Company N.V., as of Dec. 31, 2007, had
about 1,900 asbestos-related claims pending against it,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 28, 2008.
As of Sept. 30, 2007, the Company recorded about 1,993 pending
asbestos-related claims filed against it. (Class Action
Reporter, Nov. 16, 2007)
The Company is a defendant in lawsuits wherein plaintiffs allege
exposure to asbestos due to work it may have performed at
various locations. The Company has never been a manufacturer,
distributor or supplier of asbestos products.
Through Dec. 31, 2007, the Company has been named a defendant in
lawsuits alleging exposure to asbestos involving about 4,600
plaintiffs, and of those claims, 2,700 claims have been closed
through dismissals or settlements.
Through Dec. 31, 2007, the claims alleging exposure to asbestos
that have been resolved have been dismissed or settled for an
average settlement amount per claim of about US$1,000.
With respect to unasserted asbestos claims, the Company cannot
identify a population of potential claimants with sufficient
certainty to determine the probability of a loss and to make a
reasonable estimate of liability, if any.
At Dec. 31, 2007, the Company had accrued US$900,000 for
liability and related expenses.
Based in The Hague, The Netherlands, Chicago Bridge & Iron
Company N.V. is an engineering, procurement and construction
company. The Company is an integrated EPC service provider and
process technology licensor, delivering comprehensive solutions
to customers in the energy and natural resource industries. The
Company operates in more than 80 locations and has about 17,000
employees worldwide.
ASBESTOS LITIGATION: CBS Faces 72,120 Pending Claims at Dec. 31
---------------------------------------------------------------
CBS Corporation had about 72,120 pending asbestos claims as of
Dec. 31, 2007, compared with about 73,310 as of Dec. 31, 2006
and about 101,170 as of Dec. 31, 2005, according to the
Company's quarterly report filed with the U.S. Securities and
Exchange Commission on Feb. 28, 2008.
The Company faced about 72,790 pending asbestos claims as of
Sept. 30, 2007. (Class Action Reporter, Nov. 23, 2007)
The Company faces lawsuits claiming various personal injuries
related to asbestos and other materials, which allegedly
occurred principally as a result of exposure caused by various
products manufactured by Westinghouse, a predecessor, generally
before the 1970s. Westinghouse was neither a producer nor a
manufacturer of asbestos.
The Company is named as one of a large number of defendants in
both state and federal cases. In most of the asbestos lawsuits,
the plaintiffs have not identified which of the Company's
products is the basis of a claim.
Claims against the Company in which a product has been
identified principally relate to exposures allegedly caused by
asbestos-containing insulating material in turbines sold for
power-generation, industrial and marine use, or by asbestos
containing grades of decorative micarta, a laminate used in
commercial ships.
Of the claims pending as of Dec. 31, 2007, about 40,520 were
pending in state courts, 28,100 in federal courts and,
additionally, about 3,500 were third party claims pending in
state courts.
During 2007, the Company received about 4,590 new claims and
closed or moved to an inactive docket about 5,780 claims.
The Company's total costs for the years 2007 and 2006 for
settlement and defense of asbestos claims after insurance
recoveries and net of tax benefits were about US$17.5 million
and US$5.7 million, respectively.
Filings include claims for individuals suffering from
mesothelioma, the risk of which is allegedly increased primarily
by exposure to asbestos; lung cancer, a cancer which may be
caused by various factors, one of which is alleged to be
asbestos exposure; other cancers, and conditions that are
substantially less serious, including claims brought on behalf
of individuals who are asymptomatic as to an allegedly asbestos-
related disease.
Claims identified as cancer remain a small percentage of
asbestos claims pending at Dec. 31, 2007. In a substantial
number of the pending claims, the plaintiff has not yet
identified the claimed injury.
New York-based CBS Corporation is a mass media company with
operations in the following segments: Television, Radio,
Outdoor, and Publishing.
ASBESTOS LITIGATION: General Motors Corp. Facing Exposure Claims
----------------------------------------------------------------
Like most automobile manufacturers, General Motors Corporation
continues to be named in asbestos-related claims, according to
the Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 28, 2008.
The Company has used some products which incorporated small
amounts of encapsulated asbestos. These products, generally
brake linings, are known as asbestos-containing friction
products.
A number of the claims are filed against the Company by
automotive mechanics and their relatives seeking recovery based
on their alleged exposure to the small amount of asbestos used
in brake components.
These claims generally identify numerous other potential sources
for the claimant's alleged exposure to asbestos that do not
involve the Company or asbestos-containing friction products,
and many of these other potential sources would place users at
much greater risk.
Most of these claimants do not have an asbestos-related illness
and may not develop one. This is consistent with the experience
reported by other automotive manufacturers and other end users
of asbestos.
Two other types of claims related to alleged asbestos exposure
that are asserted against the Company, locomotive and premises,
represent a significantly lower exposure to liability than the
automotive friction product claims.
Like other locomotive manufacturers, the Company used a limited
amount of asbestos in locomotive brakes and in the insulation
used in some locomotives. (The Company sold its locomotive
manufacturing business in 2005). These uses have been the basis
of suits filed against the Company by railroad workers seeking
relief based on their alleged exposure to asbestos.
These claims generally identify numerous other potential sources
for the claimant's alleged exposure to asbestos that do not
involve the Company or locomotives. Many of these claimants do
not have an asbestos-related illness and may never develop one.
Moreover, the West Virginia and Ohio supreme courts have ruled
that federal law preempts asbestos tort claims asserted on
behalf of railroad workers.
In addition, a relatively small number of claims are brought by
contractors who are seeking recovery based on alleged exposure
to asbestos-containing products while working on premises owned
by the Company.
These claims generally identify numerous other potential sources
for the claimant's alleged exposure to asbestos that do not
involve the Company.
Detroit-based General Motors Corporation is engaged in the
worldwide development, production and marketing of cars, trucks
and parts. The Company develops, manufactures and markets
vehicles worldwide through its four automotive regions: GM North
America, GM Europe, GM Latin America/Africa/Mid-East and GM Asia
Pacific.
ASBESTOS LITIGATION: Coca-Cola Suits Involving Aqua-Chem Ongoing
----------------------------------------------------------------
Litigation between The Coca-Cola Company and its former
subsidiary, Aqua-Chem, Inc. (n/k/a Cleaver-Brooks, Inc.), over
any past, present or future liabilities (including asbestos) is
ongoing.
On Dec. 20, 2002, the Company filed a lawsuit (The Coca-Cola
Company v. Aqua-Chem, Inc., Civil Action No. 2002CV631-50) in
the Superior Court, Fulton County, Ga., seeking a declaratory
judgment that the Company has no obligation Aqua-Chem for any
past, present or future liabilities or expenses in connection
with any claims or lawsuits against Aqua-Chem.
Subsequent to the Company's filing but on the same day, Aqua-
Chem filed a lawsuit (Aqua-Chem, Inc. v. The Coca-Cola Company,
Civil Action No. 02CV012179) in the Circuit Court, Civil
Division of Milwaukee County, Wis.
In the Wisconsin Case, Aqua-Chem sought a declaratory judgment
that the Company is responsible for all liabilities and expenses
not covered by insurance in connection with certain of Aqua-
Chem's general and product liability claims arising from
occurrences prior to the Company's sale of Aqua-Chem in 1981,
and a judgment for breach of contract in an amount exceeding
US$9 million for costs incurred by Aqua-Chem to date in
connection with such claims.
The Wisconsin Case initially was stayed, pending final
resolution of the Georgia Case, and later was voluntarily
dismissed without prejudice by Aqua-Chem.
The Company owned Aqua-Chem from 1970 to 1981. During that time,
the Company purchased over US$400 million of insurance coverage,
of which about US$350 million is still available to cover Aqua-
Chem's costs for certain product liability and other claims.
The Company sold Aqua-Chem to Lyonnaise American Holding, Inc.
in 1981 under the terms of a stock sale agreement. The 1981
agreement, and a subsequent 1983 settlement agreement, outlined
the parties' rights and obligations concerning past and future
claims and lawsuits involving Aqua-Chem.
Cleaver-Brooks, a division of Aqua-Chem, manufactured boilers,
some of which contained asbestos gaskets. Aqua-Chem was first
named as a defendant in asbestos lawsuits in or around 1985 and
currently has more than 100,000 claims pending against it.
The parties agreed in 2004 to stay the Georgia Case pending the
outcome of insurance coverage litigation filed by certain Aqua-
Chem insurers on March 26, 2004.
In the coverage action, five plaintiff insurance companies filed
suit (Century Indemnity Company, et al. v. Aqua-Chem, Inc., The
Coca-Cola Company, et al., Case No. 04CV002852) in the Circuit
Court, Civil Division of Milwaukee County, Wis., against the
Company, Aqua-Chem and 16 insurance companies.
Several of the policies that are the subject of the coverage
action were issued to the Company during the period (1970 to
1981) when the Company owned Aqua-Chem.
The complaint seeks a determination of the respective rights and
obligations under the insurance policies issued with regard to
asbestos-related claims against Aqua-Chem. The action also seeks
a monetary judgment reimbursing any amounts paid by the
plaintiffs in excess of their obligations.
Two of the insurers, one with a US$15 million policy limit and
one with a US$25 million policy limit, asserted cross-claims
against the Company, alleging that the Company and/or its
insurers are responsible for Aqua-Chem's asbestos liabilities
before any obligation is triggered on the part of the cross-
claimant insurers to pay for such costs under their policies.
Aqua-Chem and the Company filed and obtained a partial summary
judgment determination in the coverage action that the insurers
for Aqua-Chem and the Company were jointly and severally liable
for coverage amounts, but reserving judgment on other defenses
that might apply.
During the course of the Wisconsin coverage litigation, Aqua-
Chem and the Company reached settlements with several of the
insurers, including plaintiffs, who have paid or will pay funds
into an escrow account for payment of costs arising from the
asbestos claims against Aqua-Chem.
On July 24, 2007, the Wisconsin trial court entered a final
declaratory judgment regarding the rights and obligations of the
parties under the insurance policies issued by the remaining
defendant insurers, which judgment was not appealed.
The judgment directs that each insurer whose policy is triggered
is jointly and severally liable for 100 percent of Aqua-Chem's
losses up to policy limits.
The court's judgment concludes the Wisconsin insurance coverage
litigation. The Georgia Case remains subject to the stay agreed
to in 2004.
Based in Atlanta, The Coca-Cola Company is a manufacturer,
distributor and marketer of nonalcoholic beverage concentrates
and syrups. Finished beverage products bearing the Company's
trademarks, sold in the United States since 1886, are now sold
in more than 200 countries.
ASBESTOS LITIGATION: La. Court Issues Split Ruling in Glaxo Case
----------------------------------------------------------------
The U.S. District Court, E.D. Louisiana, issues split in rulings
in an action involving asbestos, filed by Shelia Allgood,
Francis Powell, and Robin May, against GlaxoSmithKline plc.
The case is styled Shelia Allgood, et al. v. GlaxoSmithKline
plc, et al.
District Judge Eldon E. Fallon entered judgment of Civil Action
No. 06-3506 on Feb. 20, 2008.
The Plaintiffs are sisters. Their father, Jake Palermo, worked
as a longshoreman on New Orleans wharves from about 1962 until
1982. In 2000, Mr. Palermo was diagnosed with prostate cancer,
and in 2002 he was diagnosed with terminal lung cancer. Mr.
Palermo also suffered from depression.
On April 11, 2003, Dr. Robert Kessler prescribed the
antidepressant drug Paxil, 10 mg daily, to Mr. Palermo for his
depression and to increase his appetite following a bout with
pneumonia. Mr. Palermo filled his prescription that very same
day and presumably began taking the drug immediately.
Paxil is made and marketed by SmithKline Beecham Corporation
d/b/a GlaxoSmithKline ("GSK") and is designed to work by
selectively inhibiting the re-uptake of serotonin.
On April 14, 2003, at the age of 76, Mr. Palermo committed
suicide with a gunshot wound to his head. The Plaintiffs are Mr.
Palermo's sole heirs and have been involved in two separate
litigations since his death.
On Jan. 23, 2003, over two years before the filing of the
instant suit and prior to his death, Mr. Palermo sued his former
employers, certain asbestos manufacturers, ship-repair
companies, and the Port of New Orleans in Louisiana state court.
Mr. Palermo (and later his daughters, who were substituted as
plaintiffs following his death) alleged that the defendants had
exposed him to asbestos during his employment as a longshoreman.
In an amended petition, Mr. Palermo's daughters alleged that his
suicide was caused by his exposure to asbestos. After settling
with several of the defendants, the daughters proceeded to trial
in Civil District Court for the Parish of Orleans. Following a
bench trial, the court awarded the daughters US$2.5 million,
finding that Mr. Palermo's depression-induced suicide was a
direct result of his occupational exposure to asbestos.
On appeal, the Louisiana 4th Circuit Court of Appeal reversed
the trial court's finding of liability without reaching the
issue of the causal nexus between Mr. Palermo's suicide and his
exposure to asbestos.
Second, on Feb. 15, 2006, the Plaintiffs filed the instant suit
against GSK in the 24th Judicial District Court for the Parish
of Jefferson. GSK removed this case to federal court. In the
instant case, the Plaintiffs allege that their father's use
of Paxil contributed to his suicide.
The Plaintiffs asserted wrongful death and survival claims under
the Louisiana Products Liability Act (LPLA). Specifically, the
Plaintiffs invoked all four provisions of the LPLA, alleging
that Paxil was unreasonably dangerous (1) in construction or
composition, (2) in design, (3) due to an inadequate warning,
and (4) because it did not conform to an express warranty.
Nine pretrial motions were before the Court. GSK has filed seven
of these motions, six of which sought summary judgment on
various issues and one that challenged the Plaintiffs' causation
expert on Daubert grounds.
In summary, this Court found that the case should be dismissed
on two independent grounds. First, on the merits, the
Plaintiffs' claims failed under each of the LPLA provisions.
Second, assuming that any of these claims did not fail on the
merits, the Court alternatively found that the Plaintiffs should
be judicially estopped in light of the previous litigation
position taken regarding the cause of their father's suicide.
Accordingly, for the foregoing reasons, it is ordered that GSK's
Motion for Summary Judgment on Learned Intermediary is granted
and that the Plaintiffs' Motion for Partial Summary Judgment is
denied in part to the extent it addresses the learned-
intermediary doctrine.
It is further ordered that GSK's Motion for Summary Judgment on
Plaintiffs' Remaining Causes of Action is granted. It is further
ordered that GSK's Motion for Summary Judgment on the Basis of
Judicial Estoppel is granted.
David L. Colvin, Travis Jasper Causey, Jr., Colvin Law Firm,
Gretna, La., Arnold Anderson Vickery, Vickery, Waldner & Mallia,
LLP, Houston, Lewis Scott Joanen, Bruno & Bruno, New Orleans,
La., represented Shelia Allgood, et al.
Heather M. Howard, Andrew T. Bayman, L. Frank Coan, Todd P.
Davis, King & Spalding, Atlanta, James B. Irwin, V, David Wayne
O'Quinn, Monique M. Garsaud, Stephanie Lottinger Irwin, Irwin
Fritchie Urquhart & Moore LLC, New Orleans, Mark S. Brown, King
& Spalding, Washington, DC, Tamar P. Halpern, Phillips Lytle
LLP, Buffalo, N.Y., represented GlaxoSmithKline plc, et al.
ASBESTOS LITIGATION: 2nd Circuit Reverses Ruling in Rainey Suit
---------------------------------------------------------------
The U.S. Court of Appeals, 2nd Circuit, reversed a ruling of the
Benefits Review Board in favor of petitioner Lorraine G. Rainey,
Executor of the Estate of Leo T. Rainey, in an asbestos action
filed against Electric Boat Corporation.
The case is styled Lorraine G. Rainey, Executor of the Estate of
Leo T. Rainey, Petitioner, v. Director, Office of Workers'
Compensation, U.S. Department of Labor, and Electric Boat
Corporation, Respondents.
Circuit Judges Calabresi, Katzmann, and Raggi entered judgment
of Case No. 07-0434-ag on Feb. 28, 2008.
Mr. Rainey worked on submarines as a welder for the Electric
Boat from 1958 to 1967 and then again from 1972 to 1980. In
1980, Electric Boat transferred Mr. Rainey from the welding
department to the tool crib, where he worked until he retired in
1995. His tenure at Electric Boat exposed him to asbestos.
At times, the welders were required to weld overhead, and they
used asbestos blankets to protect themselves from the sparks. In
addition, Mr. Rainey often worked alongside laggers while they
installed asbestos covering to insulate pipes or removed old
asbestos covering from pipes. Mr. Rainey also smoked tobacco
from an early age until 1986.
Doctors diagnosed Mr. Rainey with lung cancer in March 2002. At
that time, Mr. Rainey, then 73 years old, had a number of other
health problems, including chronic obstructive pulmonary
disease.
Mr. Rainey submitted a claim for permanent partial disability
benefits based on his lung cancer. Following an informal
conference before the District Director of the Department of
Labor's Office of Workers' Compensation Programs, Mr. Rainey's
claim was referred to an administrative law judge (ALJ), Colleen
A. Geraghty, for a formal hearing.
The hearing commenced on Dec. 9, 2003, but was continued until
July 28, 2004 for additional discovery.
Prior to the ALJ's decision in this case, Mr. Rainey died on
Jan. 21, 2005. On Jan. 23, 2006, the ALJ released her decision
and order denying benefits.
As the executor of Mr. Rainey's estate, Mrs. Rainey appealed the
decision to the Benefits Review Board (BRB). The BRB affirmed in
an unpublished order dated Dec. 15, 2006, and this petition
followed.
This was a petition for review of a decision and order of the
BRB affirming the decision and order of the ALJ, dismissing
Mrs. Rainey's claim for permanent partial disability benefits
under the LHWCA.
The ALJ found Mrs. Rainey had successfully invoked the
presumption that Mr. Rainey's lung cancer was a recoverable
injury under the LHWCA, but that Electric Boat had introduced
substantial evidence to rebut the presumption and that, in the
absence of the presumption, Mrs. Rainey had failed to establish
that the lung cancer arose "out of and in the course of
employment.
The Appeals Court granted Mrs. Rainey's petition, reversed the
decision of the BRB, and remanded the case to the BRB for a
determination of benefits.
Carolyn P. Kelly (Amy M. Stone, of counsel), O'Brien, Shafner,
Stuart, Kelly & Morris, P.C., Groton, Conn., represented
Lorraine G. Rainey.
Kevin C. Glavin, Cutcliffe Glavin & Archetto, Providence, R.I.
(on behalf of Electric Boat Corporation), Kathleen Kim, Division
of Black Lung and Longshore Legal Services, Office of the
Solicitor, U.S. Department of Labor, Washington, D.C.,
represented the Respondents.
ASBESTOS LITIGATION: Crown Cork Records 79,000 Claims at Dec. 31
----------------------------------------------------------------
Crown Holdings, Inc.'s subsidiary, Crown Cork & Seal Company,
Inc., had 79,000 asbestos claims outstanding at the end of each
of the last three years: Dec. 31, 2007, Dec. 31, 2006, and
Dec. 31, 2005.
During 2007, Crown Cork received 4,000 new claims and settled or
dismissed 4,000 claims. During 2006, Crown Cork received 5,000
new claims and settled or dismissed 5,000 claims. During 2005,
Crown Cork received 9,000 new claims and settled or dismissed
4,000 claims.
Crown Cork is one of many defendants in a substantial number of
lawsuits filed throughout the United States by persons alleging
bodily injury as a result of exposure to asbestos.
These claims arose from the insulation operations of a U.S.
company, the majority of whose stock Crown Cork purchased in
1963. About 90 days after the stock purchase, this U.S. company
sold its insulation assets and was later merged into Crown Cork.
Prior to 1998, the amounts paid to asbestos claimants were
covered by a fund made available to Crown Cork under a 1985
settlement with carriers insuring Crown Cork through 1976, when
Crown Cork became self-insured. The fund was depleted in 1998
and the Company has no remaining coverage for asbestos-related
costs.
In April 2007, May 2006, May 2005, January 2005 and April 2004,
the States of Georgia, South Carolina, Florida, Ohio and
Mississippi, respectively, enacted legislation that limits the
asbestos-related liabilities under state law of companies like
Crown Cork that allegedly incurred these liabilities because
they are successors by corporate merger to companies that had
been involved with asbestos.
The outstanding claims at Dec. 31, 2007 exclude 33,000 pending
claims involving plaintiffs who allege that they are, or were,
maritime workers subject to exposure to asbestos.
During 2007, the Company recorded pre-tax charges of US$29
million to increase its accrual, made asbestos-related payments
of US$26 million, settled claims totaling US$15 million,
including amounts committed to be paid in future periods, and
had outstanding accruals of US$201 million at the end of the
year.
During 2006, the Company recorded pre-tax charges of US$10
million to increase its accrual, made asbestos-related payments
of US$26 million, settled claims totaling US$20 million,
including amounts committed to be paid in future periods, and
had outstanding accruals of US$198 million at the end of the
year.
The Company estimates that its probable and estimable asbestos
liability for pending and future asbestos claims and related
legal costs is US$201 million at the end of 2007, including
US$72 for unasserted claims and US$5 for committed settlements
that will be paid in 2008.
Historically (1977-2007), Crown Cork estimates that about one-
quarter of all asbestos-related claims made against it have been
asserted by claimants who claim first exposure to asbestos after
1964.
However, because of Crown Cork's settlement experience to date
and the increased difficulty of establishing identification of
the subsidiary's insulation products as the cause of injury by
persons alleging first exposure to asbestos after 1964, the
Company has not included in its accrual any amounts for
settlements by persons alleging first exposure to asbestos after
1964.
The Company's accrual of US$201 million includes estimates for
probable costs for claims through the year 2017. Estimated
additional claims costs of US$42 million beyond 2017 have not
been included in the Company's liability, as the Company
believes cost projections beyond ten years are inherently
unreliable due to potential changes in the litigation
environment and other factors whose impact cannot be known or
reasonably estimated.
Philadelphia-based Crown Holdings, Inc. designs, manufactures
and sells packaging products for consumer goods. The Company's
primary products include steel and aluminum cans for food,
beverage, household and other consumer products and metal caps
and closures. At Dec. 31, 2007, the Company operated 141 plants
along with sales and service facilities throughout 41 countries
and had about 21,800 employees.
ASBESTOS LITIGATION: Appeal on Crown Cork Action Heard in Texas
---------------------------------------------------------------
Crown Holdings, Inc. states that a plaintiff's appeal, in an
asbestos-related lawsuit filed against its subsidiary Crown Cork
& Seal Company, was heard on Feb. 7, 2008 in the Texas Supreme
Court.
In June 2003, the State of Texas enacted legislation that limits
the asbestos-related liabilities in Texas courts of companies
like Crown Cork that allegedly incurred these liabilities
because they are successors by corporate merger to companies
that had been involved with asbestos.
The Texas legislation, which applies to future claims and
pending claims, caps asbestos-related liabilities at the total
gross value of the predecessor's assets adjusted for inflation.
Crown Cork has paid significantly more for asbestos-related
claims than the total adjusted value of its predecessor's
assets.
On Oct. 31, 2003, Crown Cork received a favorable ruling on its
motion for summary judgment in two asbestos-related cases
pending against it in the district court of Harris County, Tex.
(in Re Asbestos Litigation No. 90-23333, District Court, Harris
County, Tex.), which were appealed.
On May 4, 2006, the Texas 14th Court of Appeals upheld the
favorable ruling on one of the two cases (Barbara Robinson v.
Crown Cork & Seal Company, Inc., No. 14-04-00658-CV, 14th Court
of Appeals, Tex.).
The Appeals court decision has been appealed by the plaintiff to
the Texas Supreme Court. The Texas Supreme Court has not ruled
on the appeal heard on Feb. 7, 2008.
In addition, a favorable ruling for summary judgment in an
asbestos case pending against Crown Cork in the district court
of Travis County, Tex. (in Re Rosemarie Satterfield as
Representative of the Estate of Jerrold Braley Deceased v. Crown
Cork & Seal Company, Inc. District Court Travis County, 98th
Judicial District Cause No. GN-203572) has been appealed.
Philadelphia-based Crown Holdings, Inc. designs, manufactures
and sells packaging products for consumer goods. The Company's
primary products include steel and aluminum cans for food,
beverage, household and other consumer products and metal caps
and closures. At Dec. 31, 2007, the Company operated 141 plants
along with sales and service facilities throughout 41 countries
and had about 21,800 employees.
ASBESTOS LITIGATION: Plaintiffs' Appeals v. Crown Cork Pending
--------------------------------------------------------------
Crown Holdings, Inc. states that plaintiffs' appeals on
asbestos-related lawsuits filed against subsidiary, Crown Cork &
Seal Company, are still pending in the Superior Court of
Pennsylvania.
In December 2001, the Commonwealth of Pennsylvania enacted
legislation that limits the asbestos-related liabilities of
Pennsylvania corporations that are successors by corporate
merger to companies involved with asbestos.
The legislation limits the successor's liability for asbestos to
the acquired company's asset value adjusted for inflation. Crown
Cork has already paid significantly more for asbestos-related
claims than the acquired company's adjusted asset value.
On Feb. 20, 2004, the Supreme Court of Pennsylvania reversed the
June 11, 2002 order of the Philadelphia Court of Common Pleas,
in which the Court of Common Pleas ruled favorably on a motion
by Crown Cork for summary judgment regarding 376 pending
asbestos-related cases against Crown Cork in Philadelphia and
remanded the cases to the Philadelphia Court of Common Pleas
(Ieropoli v. AC&S Corporation, et. al., No. 117 EM 2002).
The Court ruled that the new statute, as applied, violated the
Pennsylvania Constitution because it retroactively extinguished
the plaintiffs' pre-existing and accrued causes of action. The
Company said it believes that the ruling by the court was
limited only to cases which were pending at the time the
legislation was enacted.
In November 2004, the Commonwealth of Pennsylvania enacted
legislation amending the 2001 successor liability statute
providing that the 2001 statute applies only to asbestos-related
claims with respect to which the two-year statute of limitations
for asbestos-related claims had not yet commenced at the time
the statute was enacted on Dec. 17, 2001.
On July 28, 2005, the Philadelphia Court of Common Pleas granted
Crown Cork's global motion for summary judgment to dismiss all
pending asbestos-related cases filed in the court after Dec. 17,
2003 (In re: Asbestos-Litigation October term 1986, No. 001).
Additional cases have been dismissed subsequent to July 28, 2005
by the Philadelphia Court of Common Pleas.
These decisions remain subject to potential appeal by the
plaintiffs and, in some cases, appeals have been filed by the
plaintiffs in connection with these decisions and oral argument
was held before the Superior Court.
The Superior Court has not ruled on these appeals.
Philadelphia-based Crown Holdings, Inc. designs, manufactures
and sells packaging products for consumer goods. The Company's
primary products include steel and aluminum cans for food,
beverage, household and other consumer products and metal caps
and closures. At Dec. 31, 2007, the Company operated 141 plants
along with sales and service facilities throughout 41 countries
and had about 21,800 employees.
ASBESTOS LITIGATION: Deere Still Subject to Liability Lawsuits
--------------------------------------------------------------
Deere & Company continues to be subject to unresolved legal
actions that are linked to product liability, including
asbestos-related liability, according to the Company's quarterly
report filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
The Company is also subject to legal actions involving retail
credit, software licensing, patent, and trademark matters.
Moline, Ill.-based Deere & Company makes farm equipment. The
Company also produces industrial, forestry, and lawn-care
equipment. Its farm equipment includes tractors, tillers,
harvesting machinery, and soil-preparation machinery.
Construction equipment includes backhoes, skid steers, dump
trucks, waste equipment, and excavators. For the forestry
industry, the Company makes harvesters, feller bunchers, and
knuckleboom loaders.
ASBESTOS LITIGATION: Delphi Fin'l. Cites $9M Losses, LAE in '07
---------------------------------------------------------------
Delphi Financial, Inc., in 2007, recorded US$9 million as net
incurred losses and loss adjustment expenses relating to its
excess casualty insurance, which consists of a discontinued
excess umbrella liability program.
This program entails exposure to excess of loss liability claims
from past years, including environmental and asbestos-related
claims, according to the Company's annual report filed with the
U.S. Securities and Exchange Commission on Feb. 28, 2008.
Net incurred losses and loss adjustment expenses relating to
this program totaled US$8 million in 2006 and US$6.5 million in
2005.
Wilmington, Del.-based Delphi Financial, Inc. is a holding
company whose subsidiaries provide integrated employee benefit
services. The Company manages all aspects of employee absence
and provides the related insurance coverages: long-term and
short-term disability, excess and primary workers' compensation,
group life, travel accident and dental.
ASBESTOS LITIGATION: Cytec Ind. Records $53.9M Liability at Dec.
----------------------------------------------------------------
Cytec Industries Inc.'s asbestos liability was US$53.9 million
as of Dec. 31, 2007, compared with US$54.6 million as of Dec.
31, 2006, according to the Company's annual report filed with
the U.S. Securities and Exchange Commission on Feb. 28, 2008.
The related insurance receivable was US$35.6 million as of Dec.
31, 2007, compared with US$38.1 million as of Dec. 31, 2006.
The Company is the subject of numerous lawsuits and claims
incidental to the conduct of its or certain of its predecessors'
businesses, including lawsuits and claims relating to product
liability, personal injury including asbestos, environmental,
contractual, employment and intellectual property matters.
As of Dec. 31, 2007, the aggregate self-insured and insured
contingent liability was US$70.1 million and the related
insurance recovery receivable was US$37.6 million.
As of Dec. 31, 2006, the aggregate self-insured and insured
contingent liability was US$72.7 million and the related
insurance recovery receivable was US$40.9 million.
West Paterson, N.J.-based Cytec Industries Inc. is a global
specialty chemicals and materials company. The Company's
products serve a diverse range of end markets including
aerospace, adhesives, automotive and industrial coatings,
chemical intermediates, inks, mining and plastics. The Company
operates on a global basis with 36 percent of its 2007 revenues
in North America, 44 percent in Europe, 14 percent in Asia-
Pacific and six percent in Latin America. The Company has
manufacturing and research facilities located in 18 countries.
ASBESTOS LITIGATION: 8,200 Claims Still Pending v. Cytec at Dec.
----------------------------------------------------------------
Cytec Industries Inc. recorded 8,200 asbestos-related claims for
the year ended Dec. 31, 2007, compared with 8,600 claims for the
year ended Dec. 31, 2006, according to the Company's annual
report filed with the U.S. Securities and Exchange Commission on
Feb. 28, 2008.
The Company recorded 8,200 claimants with asbestos cases against
it in the the nine months ended Sept. 30, 2007. (Class Action
Reporter, Nov. 9, 2007)
In the year ended Dec. 31, 2007, the Company recorded 700
claimants associated with claims closed during period and 300
claimants associated with claims opened during period.
In the year ended Dec. 31, 2006, the Company recorded 15,800
claimants associated with claims closed during period and 2,200
claimants associated with claims opened during period.
Like many other industrial companies, the Company has been named
as one of hundreds of defendants in a number of lawsuits filed
in the U.S. by persons alleging bodily injury from asbestos.
The claimants allege exposure to asbestos at facilities that the
Company owns or formerly owned or from products that the Company
manufactured for specialized applications.
Most of these cases involve numerous defendants, sometimes as
many as several hundred. Historically, most of the closed
asbestos claims against the Company have been dismissed without
any indemnity payment by it.
West Paterson, N.J.-based Cytec Industries Inc. is a global
specialty chemicals and materials company. The Company's
products serve a diverse range of end markets including
aerospace, adhesives, automotive and industrial coatings,
chemical intermediates, inks, mining and plastics. The Company
operates on a global basis with 36 percent of its 2007 revenues
in North America, 44 percent in Europe, 14 percent in Asia-
Pacific and six percent in Latin America. The Company has
manufacturing and research facilities located in 18 countries.
ASBESTOS LITIGATION: Suit v. CSX Transportation Filed on Jan. 29
----------------------------------------------------------------
Geneva Fritz, on behalf of the estate of Bobby Fritz, filed an
asbestos-related lawsuit against CSX Transportation Inc. in
Kanawha Circuit Court, W.Va., on Jan. 29, 2008, The West
Virginia Record reports.
According to the suit, Mr. Fritz was employed by CSX. During his
employment he was required to work with near toxic and harmful
dusts, which contained asbestos and other harmful materials.
As a result of the exposure, Mr. Fritz contracted lung cancer
and other diseases. However, according to the suit, the lung
cancer went undiagnosed and therefore untreated for three years.
He died from the disease, which the suit says is an occupational
injury.
According to the suit, CSX should have provided proper safety
equipment and ways to help workers avoid the toxins and harmful
dusts.
Mrs. Fritz claims Mr. Fritz suffered personal injury, great
pain, extreme anxiety and his enjoyment of life was greatly
diminished.
Mrs. Fritz seeks compensatory and punitive damages for his
estate and the loss of services, society, affection, counseling
and support to his household.
Attorney James A. McKowen is representing Mrs. Fritz.
Kanawha Circuit Court Case No. 08-C-191 will be assigned to a
visiting judge.
ASBESTOS LITIGATION: W.R. Grace to Pay $250M for Montana Cleanup
----------------------------------------------------------------
W.R. Grace & Co. has agreed to pay the U.S. federal government
US$250 million for environmental cleanup around its mining
operations in Libby, Mont., The New York Times reports.
The Department of Justice and the Environmental Protection
Agency announced the settlement on March 11, 2008. In a news
release, they called it the largest payment ordered under the
federal Superfund program.
The settlement requires the approval of a federal judge
overseeing the Company's bankruptcy proceedings and does not
resolve a separate criminal case in Montana also arising from
Grace's alleged asbestos contamination of Libby.
Spokesman Greg Euston said the Company was pleased with the
settlement but that he could not comment further on orders of
the judge in the criminal matter.
Andrew Ames, a Justice Department spokesman, on March 11, 2008,
said that the department could not comment on the settlement
because of the continuing criminal case.
In February 2005, federal prosecutors charged W. R. Grace and
seven senior employees with knowingly exposing miners and
residents in Libby to asbestos. More than 1,200 people became
ill, and some died, prosecutors said.
An extensive cleanup operation has been under way in and near
Libby since May 2000. The Company filed for bankruptcy
protection in 2001. In 2003, a federal court in Montana ordered
the Company to pay the EPA US$54 million for investigation and
cleanup costs incurred to that point, but the money has not been
paid because of the bankruptcy proceeding.
The settlement announced on March 11, 2008 takes account of that
payment and directs that future payments be directed to a
special EPA account to be used to clean schools, homes and
businesses in Libby that are contaminated with carcinogenic
asbestos dust.
The material came from a vermiculite mine and processing plant
the company operated in and near Libby from 1963 to 1990.
ASBESTOS LITIGATION: Commission Refers Equitable Case to Iowa AG
----------------------------------------------------------------
The Iowa Environmental Protection Commission, on March 11, 2008,
voted to refer an asbestos case, involving Equitable L.P. and
Equitable Condo, to the Iowa Attorney General's office, The Des
Moines Register reports.
The Iowa Department of Natural Resources has accused developer
Bob Knapp, the owner of the Equitable companies, and his crews
of violating a list of state regulations meant to protect
workers and the public from breathing asbestos fibers.
John Bouslog, a partner in a law firm located in the building,
said tenants were not told for four months that the DNR had
discovered issues in the building.
On March 11, 2008, the Iowa Environmental Protection Commission
met to decide whether to refer Mr. Knapp and his company,
Equitable L.P., to the attorney general's office with a
recommendation for pursuing a large fine.
The DNR can only assess a fine of up to US$10,000 per incident,
but DNR lawyers want more in this case.
The attorney general's office could assess a fine of up to
US$10,000 a day in an asbestos case. Typically, fines are not
assessed for every day a violation occurred.
Mr. Knapp is remodeling the upper floors of the 19-story, 84-
year-old building, converting the space into condominiums.
ASBESTOS LITIGATION: Gosse Seeks End to Canadian Housing Inquiry
----------------------------------------------------------------
Gordie Gosse, a provincial housing critic for Canada's New
Democratic Party, wants to make sure the Labour Department's
probe into asbestos-laced public housing units wraps up in time
to press charges, The Chronicle Herald Nova Scotia reports.
Any charges against a person or department would have to be
filed by April 3, 2008.
In April 2006, residents living in about 90 housing units in the
Whitney Pier and Ashby areas in Nova Scotia found out their
homes contained asbestos. The province owns the homes.
Jamie Della Valle, the safety coordinator for the regional
housing authority at the time, was sent a letter in October 2005
telling him about the contamination.
The Labour Department expects the investigation will be finished
by April 3, 2008. One of the staff members responsible for the
file died in a car accident during the course of the
investigation, which has slowed the process.
Legislation states that all internal probes must be completed
within two years, Bruce Nunn said. This investigation was
sparked by a complaint received in April 2006, he said.
Mr. Nunn said the average time to complete this type of
investigation can range between one month and two years. He
would not say whether any charges of negligence would be laid or
who they might be laid against.
The province hired an environmental auditing firm to test the
asbestos levels in the housing units in 2006. It found that the
best solution would be to seal off the asbestos-lined attics and
monitor the chemical levels.
ASBESTOS LITIGATION: Leigh Day Recovers Over GBP170T in Damages
---------------------------------------------------------------
Leigh Day & Co has successfully recovered over GBP170,000 in
damages for Luc Nadal, a former hospital manager who developed
mesothelioma, an asbestos-related lung cancer, following his
exposure at Woodhurst Hospital, a hospital during the 1970s and
1980s, abeceder reports.
Mr. Nadal worked as a charge nurse at the hospital near Crawley
in Sussex, England. This meant he had to go into the basement
area which contained a boiler and extensive pipework which was
lagged with suspected asbestos insulation.
Mr. Nadal and his workmates described how the insulation broke
down over time and may have been damaged by work processes
there.
Through documents obtained during the course of Mr. Nadal's
claim, it became apparent that extensive asbestos removal works
took place at the hospital, but not until the mid-1990s.
Mr. Nadal's former employers refused to accept that he had been
exposed to dangerous quantities of asbestos, or even that
asbestos was present at the hospital. Despite thism Mr. Nadal
successfully achieved a significant global settlement to his
claim, which he intends to use to pay for his medical treatment
and care at home.
Mr. Nadal was represented by Leigh Day & Co's Daniel Easton, who
specializes in asbestos disease cases.
The case was pursued through the High Court's fast track
mesothelioma system to enable a resolution of the claim within
just a few months of Mr. Nadal instructing Leigh Day & Co.
ASBESTOS LITIGATION: U.K. Group Seeks to Widen Drug Eligibility
---------------------------------------------------------------
Sufferers of mesothelioma, in Derbyshire, England, are being
denied treatment that could extend their lives and alleviate
their symptoms, Evening Telegraph reports.
They are being told they are not eligible for a drug, Alimta,
that works by slowing the growth of tumors if they have already
had a course of chemotherapy.
Alimta also helps relieve symptoms including breathlessness,
chest pain, persistent cough and loss of appetite.
In January 2008, campaigners were delighted when the National
Institute for Health and Clinical Excellence recommended that
the NHS should fund the treatment of Alimta for mesothelioma
patients.
However, the guidelines given by the institute only included
patients who had not previously been treated with chemotherapy.
It is down to the local primary care trust to decide whether to
fund it for patients who have previously had chemotherapy.
If funding is not agreed, then patients would have to pay around
GBP10,000 for a course of the drug and an extra GBP15,000 for
medical care.
Both Derbyshire county and city primary care trusts told the
Evening Telegraph that their policies were to fund Alimta only
for patients who had not previously had chemotherapy.
Joanne Carlin, of Derbyshire Asbestos Support Team, said it was
unfair that some sufferers were being refused treatment.
People being treated with Alimta survive, on average, for an
extra two-and-a-half months. However, the proportion of people
who survive for a year is almost doubled compared to those not
taking the drug and a handful of people will live for two years
or more. The average survival time without treatment is seven or
eight months.
Tony Tinley, regional officer for the Unite union, which
represents many workers who have been exposed to asbestos, said,
"We campaigned to get the treatment in the first place. But it's
like they've filled a hole in a dyke in one area and sprung a
leak in another."
The National Institute for Health and Clinical Excellence said
it only approved Alimta for first-time chemotherapy patients
because that was the only group on which trials had been carried
out.
But according to Liz Darlison, a nurse consultant at advice
group Mesothelioma UK, the group was seeing the benefits of
Alimta being used following other chemotherapy treatment.
Both Derbyshire county and city primary care trusts said they
were sticking by the institute's guidelines.
ASBESTOS LITIGATION: Sen. Baucus Pushes for Libby, Mont. Cleanup
----------------------------------------------------------------
Senator Max Baucus, D-Mont., is demanding that federal
environmental protection officials push for budgets big enough
to thoroughly clean deadly asbestos from the town of Libby,
Mont., The Missoulian reports.
In Feb. 15, 2008, damage at the community's Asa Wood Elementary
School resulted in asbestos-laced vermiculite insulation
spilling onto the ground. Children discovered the pile during
recess, and reported it to teachers.
Sen. Baucus called on U.S. Environmental Protection Agency Chief
Stephen Johnson to declare a "public health emergency" in Libby.
Since the Feb. 15, 2008 spill, school officials have begun talks
regarding the possibility of a new facility for elementary
students. In addition to the contamination problems, Asa Wood
School was built as a junior high, and is not ideal for smaller
children.
At the meeting, before the Senate Environment and Public Works
Committee, Sen. Baucus pressed Mr. Johnson about why EPA is not
requesting more money for Libby's cleanup.
The town is a declared Superfund site, the result of lethal
asbestos being dug up alongside vermiculite at the now-defunct
W.R. Grace and Co. mine. The vermiculite was widely used as
building insulation, and is prevalent throughout the town.
The administration's proposed Superfund remediation budget, Sen.
Baucus said, represents a US$5 million decrease from last year.
Currently, EPA cleanup crews leave asbestos inside Libby's
walls, where it is contained, rather than conducting a more
thorough cleaning. To date, nearly 1,000 homes have been cleaned
in Libby, but much asbestos remains in those walls.
The rationale for that decision is, in large part, available
funds, but Sen. Baucus insists more money could be made
available if the agency and the administration would agree to
declare a public health emergency for the town.
From 1997 to 2000, EPA averaged 87 completed cleanups per year,
according to the senator's staff. In 2002, the number dropped to
42. In 2003 and 2004, only 40 cleanups were completed.
Sen. Baucus is a senior member of the Senate Environment and
Public Works Committee, which has jurisdiction over both EPA and
the Superfund program.
In addition to his latest letter to Mr. Johnson, Sen. Baucus has
again introduced an "asbestos awareness resolution," hoping to
designate the first week of April as National Asbestos Awareness
Week.
ASBESTOS LITIGATION: Whisnat Lawsuit v. DuPont Ongoing in Texas
---------------------------------------------------------------
An asbestos-related lawsuit filed on behalf of Willis Whisnat
Jr. and other plaintiffs against E.I. du Pont de Nemours and
Company is ongoing in Judge Donald Floyd's 172nd Judicial
District Court in Texas, The Southeast Texas Record reports.
The trial wrapped up its third week of testimony on March 7,
2008.
The trial focuses on Mr. Whisnat, a pipefitter who smoked
throughout his adult life and worked at DuPont's Sabine Works
facility in Beaumont, Tex. Working back in 1968 as an
independent contractor, he was allegedly exposed to enough
asbestos fibers to contract mesothelioma. He died sometime in
the late 1990s.
Jurors heard excerpts of depositions given by several former
DuPont workers who worked with Mr. Whisnat during the late
1960s. The workers testified that they never saw Mr. Whisnat
wearing a respirator, a device designed to filter asbestos dust.
DuPont contends that its safety policies during the 1960s and
1970s required employees working around "extreme" dust to wear
respirators.
However, an industrial hygienist, hired by the plaintiffs,
passionately testified that workers were not capable of
determining when they were working in "extreme" dusty
conditions.
During his testimony, the plaintiffs' expert began shouting at
DuPont defense attorney Larry cotton, who is an attorney for the
Fort Worth, Tex., law firm Cotten and Schmidt.
The trial began on Feb. 21, 2008 and is expected to conclude
sometime in mid-March 2008.
According to expert testimony offered by Dr. Edwin Holstein,
DuPont was well aware asbestos in the work place was killing its
workers in the early 1960s, but did nothing until the government
stepped in.
After Mr. Whisnat's death, his family joined an ongoing class-
action suit against DuPont and several other oil and chemical
companies, which was first filed in the Jefferson County
District Court on June 4, 1998.
According to medical testimony, Mr. Whisnat's chest was riddled
with bone-eating tumors, a condition the defense is attempting
to link to Mr. Whisnat's seven-year stint at DuPont.
In his opening remarks, plaintiff's attorney Glen Morgan said
DuPont's asbestos policies during the 1960s, 1950s and 1940s
were so malicious that the Company's "right to exist should be
taken away."
If Mr. Morgan has his way and DuPont is forced out of existence,
more than 60,000 people would lose their jobs, according to
employment figures on DuPont's Web site. However, Mr. Morgan did
say during opening remarks that he would not ask jurors to award
his clients billions of dollars.
The plaintiffs maintain that DuPont knew about the dangers of
asbestos as early as 1940, but chose to conceal their findings
and focus on a defense to protect the company from lawsuits
rather than implement policies that would save the lives of its
workers.
DuPont's attorneys argue that its 1940s studies only focused on
people who were "heavily" exposed to asbestos on a daily basis,
like miners for example, not chemical plant workers.
DuPont also argues that the chemical company was a consumer not
a producer of asbestos-containing products, placing product
liability on the seller - and took steps to protect its
employees from asbestos before OSHA implemented asbestos
guidelines in 1972.
In addition, DuPont contends Mr. Whisnat was an independent
contractor, not a DuPont employee, and therefore Mr. Whisnat's
employer, B.F. Shaw, was directly responsible for his safety.
And even though he was not a DuPont employee, the company still
protected Mr. Whisnat from asbestos by requiring pipe workers to
wear respirators.
DuPont protected its other workers by barricading asbestos-laced
pipe work sites. However, the plaintiffs argue that asbestos
fibers can drift beyond the barricade, which only consisted of
yellow caution tape.
ASBESTOS LITIGATION: N.Y. Carpenter to Serve 15 Months in Prison
----------------------------------------------------------------
John Chick, the former carpenter from Cayuga County, N.Y., who
pleaded guilty to illegally removing asbestos from a county
building two years ago, will commence his 15-month prison
sentence on April 22, 2008, The Citizen reports.
Mr. Chick learned his sentence on March 6, 2008, in U.S.
District Court in Syracuse. Judge Frederick Scullin Jr. also
sentenced Mr. Chick to three years post-release supervision and
ordered him to pay US$108,000 in restitution in monthly
installments.
In court, Mr. Chick said that he was merely following orders
from superiors, a charge county leaders have denied. Judge
Scullin said that even if Mr. Chick's story is true, he still
must bear some responsibility.
The illegal asbestos removal took place in February 2006 at the
Cayuga County Board of Elections building.
The case has resulted in roughly 30 people, from county
employees to members of the public, filing claims against the
county over possible exposure.
The elections building itself was shut down for several weeks
for cleanup.
ASBESTOS LITIGATION: Calif. Couple Gets $20M in Georgia-Pacific
---------------------------------------------------------------
Joan Mahoney, a 69-year old mesothelioma sufferer, and her
husband Daniel Mahoney won a US$20 million verdict in an
asbestos-related case, in which the jury attributed 30 percent
of liability to Georgia-Pacific Corporation, according to a
Baron & Budd, P.C. press release dated March 12, 2008.
Baron & Budd attorneys John Langdoc and Roger Gold represented
the Mahoneys before Judge Thomas Mellon in San Francisco County
Superior Court, announced Russell Budd, managing shareholder of
Baron & Budd.
Mrs. Mahoney, a San Francisco native, spent much of her career
in real estate and show business. Her singing career spanned 30
years and took her around the world seven times on United
Service Organizations (USO) tours.
However, it was Mrs. Mahoney's work in the part-time family
construction business that exposed her to Georgia Pacific's
asbestos-containing joint compound, the suit established.
Together, Mrs. Mahoney and her husband, who was also a math
teacher, built and remodeled over 200 houses in the 1970s, 1980s
and 1990s.
The evidence at trial showed that Georgia-Pacific knew from the
moment it entered the asbestos business that asbestos exposure
causes disease. Years before the Mahoneys first used Georgia
Pacific's asbestos-containing joint compound, Georgia-Pacific
knew that its product posed a substantial risk to workers.
However, Georgia-Pacific continued making asbestos-containing
joint compounds well after other companies stopped.
Georgia-Pacific made a conscious business decision to benefit
financially from the fact that other manufacturers ceased
manufacturing the more profitable asbestos containing joint
compounds.
Not until the government banned certain uses of asbestos in
1977, after the Consumer Product Safety Commission said that
exposure to asbestos-containing joint compound for as little as
six hours a day, four times per year could result in thousands
of people developing cancer, did Georgia-Pacific stop selling
asbestos containing joint compound.
Mrs. Mahoney was diagnosed with mesothelioma in 2006, 35 years
after her first exposure to Georgia Pacific's product. She
continues to fight the painful disease that experts say will
cause great suffering and eventually kill her.
ASBESTOS LITIGATION: Suit v. 42 Firms Filed Last Feb. 1 in W.Va.
----------------------------------------------------------------
Charles Edward McLane, on Feb. 1, 2008, filed an asbestos-
related lawsuit against 42 companies, including three local
corporations where he worked, in Kanawha Circuit Court, W.Va.,
The West Virginia Record reports.
Mr. McLane claims the companies are responsible for exposing him
to asbestos. Defendants include E.I. du Pont de Nemours and
Company and Goodrich Corporation.
Mr. McLane claims he breathed asbestos and other harmful dusts
created by the use of the products, which caused injury to his
lungs, respiratory and cardiovascular systems.
The suit specifically mentions Minnesota Mining and
Manufacturing, also known as 3M, a company who formerly
manufactured and marketed asbestos-containing products and dust
masks.
Mr. McLane claims he was led to believe the masks would protect
him from harmful dusts, fumes and other harmful products.
However, the suit says Mr. McLane suffered damages and losses
because the masks did not protect him the way 3M marketed.
According to the suit, the other defendants also owe Mr. McLane
for his injuries because they failed to warn him of the dangers
associated with exposure to the dangerous products.
In the 12-count suit, Mr. McLane claims he suffered serious
bodily injury, endured great pain and suffering and mental
anguish and incurred lost earnings and earning capacity.
Mr. McLane seeks compensatory and punitive damages.
Attorney Cindy J. Kiblinger represents Mr. McLane.
Kanawha Circuit Court Case No. 08-C-219 will be assigned to a
visiting judge.
ASBESTOS LITIGATION: French Court Upholds EUR75T Fine v. Alstom
---------------------------------------------------------------
The Court of Appeal in Douai, France, on March 6, 2008, upheld
an EUR75,000 penalty against Alstom Power Boilers, which exposed
its workers to asbestos dust, Safety & Health Practitioner
reports.
The ruling is a first in France, as the Company was also ordered
to pay damages to all employees exposed to the risk, regardless
of whether they had been directly affected or not.
From 1998 to 2001, workers at Alstom Power Boilers' site in
Lily-lez-Lannoy were exposed to asbestos dust in what the court
described as a "deliberate violation" of the Company's health
and safety obligations.
The list of Alstom's failures included not providing sufficient
information for workers regarding protection from the harmful
substance.
As a result of sustained exposure, seven of the Company's
employees died, and 30 percent of the workforce developed some
form of asbestos-related disease.
Former plant manager Bernard Gomez, had his suspended prison
sentence reduced, from nine months in the original judgment at
the court of Lille in September 2006 to just three months. His
EUR3,000 fine was upheld at appeal.
In December 2007, civil proceedings saw Alstom ordered to pay
EUR10,000 in damages to each one of the 150 workers who were
employed on the site during the three-year period.
ASBESTOS LITIGATION: Ford Lodges Appeal to AUD840T Compensation
---------------------------------------------------------------
Ford Motor Company of Australia Limited, on March 11, 2008,
launched an appeal against a landmark ruling to award Antonino
Lo Presti, a former mechanic, AUD840,000 compensation for
exposure to asbestos, Herald and Weekly Times reports.
The 58-year-old Mr. Lo Presti used compressed air to blow out
the brake drums and handled asbestos brake linings when brakes
were serviced or changed between 1970 and 1971 at two Ford
dealerships he worked at.
In February 2008, Mr. Lo Presti was the first motor mechanic in
Australia to win a successful negligence verdict against a car
company for exposure to asbestos in the West Australian Supreme
Court.
Mr. Lo Presti's lawyer Michael Magazanik said the Ford Motor
Company of Australia had 35 days to give grounds as to why. He
said the appeal was a blow to his client, who suffers from
serious fibrosis and requires constant oxygen.
Mr. Magazanik said, "This is yet another hurdle for a sick man.
He's been battling this for years and he's not about to give up
the fight."
ASBESTOS LITIGATION: Aon Corporation Has $71M Liability at Dec.
---------------------------------------------------------------
Aon Corporation's liabilities associated with foregoing
indemnities were US$69 million as of Dec. 31, 2007, compared
with US$81 million as of Dec. 31, 2006, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 28, 2008.
Reinsurance recoverables and other assets related to these
liabilities are US$87 million as of Dec. 31, 2007 and US$94
million as of Dec. 31, 2006.
The remaining insurance liabilities represent estimates of known
and future claims expected to be settled over the next 20 to 30
years, principally with regards to asbestos, pollution and other
health exposures.
In 2006, an agreement was reached relating to the settlement of
certain legacy reinsurance claims, which resulted in a pretax
gain, net of expenses, of US$13 million.
In 2005, a pretax expense of US$11 million was recorded for
consulting and legal costs related to completed and contemplated
settlements and actuarial refinements to claims reserves and
reinsurance recoverables.
Chicago-based Aon Corporation is an insurance brokerage and
reinsurance broker. The Company operates in three major
segments: commercial brokerage, consulting services, and
consumer insurance underwriting.
ASBESTOS LITIGATION: Dalmine Faces 57 Pending Claims at Dec. 31
---------------------------------------------------------------
Tenaris, S.A. states that its subsidiary, Dalmine S.p.A., as of
Dec. 31, 2007, faces 57 asbestos-related claims, of which three
are covered by insurance, according to a Company report, on Form
6-K, filed with the U.S. Securities and Exchange Commission on
Feb. 29, 2008.
As of Sept. 30, 2007, Dalmine had about 54 total pending
asbestos-related claims filed against it, of which three claims
were covered by insurance. (Class Action Reporter, Nov. 30,
2007)
Dalmine, a subsidiary organized in Italy, is subject to 13 civil
proceedings for work-related injuries arising from the use of
asbestos in its manufacturing processes during the period from
1960 to 1980.
In addition, another 43 asbestos related out-of-court claims and
1 civil party claim have been forwarded to Dalmine.
During 2007, 29 new claims were filed, two claims were
adjudicated, two claims were dismissed and no claim was settled.
Aggregate settlement costs to date for the Company are EUR5.1
million (US$7.5 million). Dalmine estimates that its potential
liability in connection with the claims not yet settled is about
EUR19.8 million (US$29.1 million).
Luxembourg-based Tenaris, S.A. manufactures and distributes
seamless steel pipe products. Siderca, the Company's Argentine
producer, makes casings, tubing, and line pipe used in the oil
and gas industry. Subsidiary Tubos de Acero de Mexico, S.A.
(Tamsa) also manufactures casings, tubing, line pipe, and other
mechanical and structural seamless pipe. Italian subsidiary
Dalmine makes seamless steel pipe used by the automotive and
machinery industries.
ASBESTOS LITIGATION: Texas Eastern Faces James Case in La. Court
----------------------------------------------------------------
Spectra Energy Corp states that its general partner Texas
Eastern Products Pipeline Company, LLC, since May 2003, is a
defendant in an asbestos lawsuit styled John R. James, et al. v.
J Graves Insulation Company, et al. as filed in the 1st Judicial
District Court, Caddo Parish, La.
There are numerous plaintiffs identified in the action that are
alleged to have suffered damages as a result of alleged exposure
to asbestos-containing products and materials.
According to the petition and as a result of a preliminary
investigation, Texas Eastern said it believes that the only
claim asserted against it results from one individual for the
period from July 1971 through June 1972, who is alleged to have
worked on a facility owned by Texas Eastern's predecessor.
This period represents a small portion of the total alleged
exposure period from January 1964 through December 2001 for this
individual. The individual's claims involve numerous employers
and alleged job sites.
Texas Eastern has been unable to confirm its or its predecessors
involvement with the alleged location, and it is uncertain at
this time whether this case is covered by insurance.
Discovery is planned, and Texas Eastern intends to defend itself
vigorously against this lawsuit. The plaintiffs have not
stipulated the amount of damages that they are seeking in this
suit.
The Company is obligated to reimburse Texas Eastern for any
costs it incurs related to this lawsuit.
Texas Eastern owns a two percent general partner interest in the
Company.
Houston-based Spectra Energy Corp owns and operates
complementary natural gas-related energy assets and is a natural
gas infrastructure company. The Company operates in three key
areas of the natural gas industry: transmission and storage,
distribution, and gathering and processing.
ASBESTOS LITIGATION: Entergy Units Face 600 Actions w/ 8T Claims
----------------------------------------------------------------
Subsidiaries of Entergy Corporation face about 600 asbestos-
related lawsuits involving about 8,000 claimants, according to
the Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 29, 2008.
Numerous lawsuits have been filed in federal and state courts in
Texas, Louisiana, and Mississippi primarily by contractor
employees in the 1950-1980 timeframe against Entergy Gulf
States, Inc., Entergy Louisiana, LLC, Entergy New Orleans, Inc.,
and Entergy Mississippi, Inc. as premises owners of power
plants, for damages caused by alleged exposure to asbestos or
other hazardous material. Many other defendants are named in
these lawsuits as well.
The Company's utility units: Entergy Gulf States, Inc., Entergy
Louisiana, Entergy Mississippi, and Entergy New Orleans faced
about 600 asbestos-related lawsuits with about 10,000 claims.
(Class Action Reporter, March 16, 2007)
New Orleans-based Entergy Corporation is an integrated energy
company engaged in electric power production and retail electric
distribution operations. The Company owns and operates power
plants with about 30,000 MW of electric generating capacity. The
Company delivers electricity to 2.7 million utility customers in
Arkansas, Louisiana, Mississippi, and Texas. The Company
generated annual revenues of US$11.5 billion in 2007 and had
about 14,300 employees as of Dec. 31, 2007.
ASBESTOS LITIGATION: Essex Int'l. Still Facing Liability Suits
--------------------------------------------------------------
Superior Essex Inc. states that, since about 1990, Essex
International Inc. and certain subsidiaries have been named as
defendants in a number of asbestos product liability lawsuits,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 29, 2008.
Essex International is a subsidiary of Superior Essex Holding
Corp., which is a Company subsidiary.
These suits were brought by electricians, other skilled
tradesmen and others claiming injury, from exposure to asbestos
found in electrical wire products produced many years ago.
Litigation against various past insurers of Essex International
who had previously refused to defend and indemnify Essex
International against these lawsuits was settled during 1999.
Under the settlement, Essex International was reimbursed for
substantially all of its costs and expenses incurred in the
defense of these lawsuits, and the insurers have undertaken to
defend, are currently directly defending and, if it should
become necessary, will indemnify Essex International against
those asbestos lawsuits, subject to the terms and limits of the
respective policies.
Under the plan of reorganization, certain of the claimants in
these actions will only be able to assert claims against the
insurers under applicable insurance coverage and related
arrangements.
Atlanta-based Superior Essex Inc. is a wire and cable
manufacturer. The Company manufactures and supplies wire and
cable products for the communications, energy, automotive,
industrial, and commercial/residential end-markets. The Company
operates 25 manufacturing facilities in North America, Europe
and China and employs about 4,500 people.
ASBESTOS LITIGATION: SCC Affiliates Involved in ASARCO Matters
--------------------------------------------------------------
Southern Copper Corp.'s direct and indirect parent corporations
continue to be named parties in various litigations, including
those that are asbestos-related, involving Asarco, LLC,
according to the Company's annual report filed with the U.S.
Securities and Exchange Commission on Feb. 29, 2008.
The Company's direct and indirect parent corporations, including
Americas Mining Corporation (AMC) and Grupo Mexico, have from
time to time been named parties in various litigations involving
Asarco.
In August 2002, the U.S. Department of Justice brought a claim
alleging fraudulent conveyance in connection with AMC's then-
proposed purchase of the Company from a subsidiary of Asarco.
That action was settled under a Consent Decree dated Feb. 2,
2003. In March 2003, AMC purchased its interest in the Company
from Asarco.
In October 2004, AMC, Grupo Mexico, Mexicana de Cobre and other
parties, not including the Company, were named in a lawsuit
filed in New York State court in connection with alleged
asbestos liabilities, which lawsuit claims that AMC's purchase
of SCC from Asarco should be voided as a fraudulent conveyance.
The lawsuit filed in New York State court was stayed as a result
of the August 2005 Chapter 11 bankruptcy filing by Asarco.
However, on Nov. 16, 2007, this lawsuit, after being removed
from Federal Court, was transferred to the U.S. District Court
for the Southern District of Texas in Brownsville, Tex., for
resolution in conjunction with a new lawsuit filed by Asarco,
the debtor in possession.
On Feb. 2, 2007 a complaint was filed by Asarco, the debtor in
possession, alleging many of the matters previously claimed in
the New York State lawsuit, including that AMC's purchase of the
Company from Asarco should be voided as a fraudulent conveyance.
In late December 2004 and early January 2005, three purported
class action derivative lawsuits were filed in the Delaware
Court of Chancery (New Castle County) relating to the merger
transaction between the Company and Minera Mexico.
On Jan. 31, 2005, the three actions were consolidated. The
consolidated complaint alleges that the merger was the result of
breaches of fiduciary duties by the Company's directors and was
not entirely fair to the Company and its minority stockholders.
The case is currently in the early stages of discovery.
In 2005, certain subsidiaries of Asarco filed bankruptcy
petitions in connection with alleged asbestos liabilities.
In August 2005, Asarco filed a voluntary petition for relief
under Chapter 11 of the U.S. Bankruptcy Code before the U.S.
Bankruptcy Court in Corpus Christi, Tex. Asarco's bankruptcy
case is being joined with the bankruptcy cases of its
subsidiaries.
Phoenix-based Southern Copper Corporation is an integrated
copper producer. The Company produces copper, molybdenum, zinc
and silver. All of its mining, smelting and refining facilities
are located in Peru and in Mexico and the Company conducts
exploration activities in those countries and Chile.
ASBESTOS LITIGATION: Exposure Claims Pending v. Roper Industries
----------------------------------------------------------------
Asbestos-related exposure claims are still pending against Roper
Industries, Inc. and its subsidiaries, according to the
Company's annual report filed with the U.S. Securities and
Exchange Commission on Feb. 29, 2008.
Over recent years there has been a significant increase in
certain U.S. states in asbestos-related litigation claims
against numerous industrial companies.
No significant resources have been required by the Company to
respond to these cases. Given the state of these claims it is
not possible to determine the potential liability, if any.
Roper Industries, Inc. is a diversified growth company that
designs, manufactures and distributes energy systems and
controls, scientific and industrial imaging products and
software, industrial technology products and radio frequency
(RF) products and services.
ASBESTOS LITIGATION: ASARCO Seeing $242M to $447M in Liabilities
----------------------------------------------------------------
Asarco Incorporated relates that after preliminary expert
discovery, ASARCO LLC has estimated that the aggregate asbestos-
related liability for its Asbestos Subsidiary Debtors would be
between US$242,100,000 and US$446,900,000.
The Asbestos Debtors estimate that their maximum possible
aggregate asbestos-related liability is US$180,000,000.
In light of ASARCO LLC's own admissions regarding the maximum
amount of its potential asbestos liability, Asarco Inc. notes
that ASARCO LLC cannot value the asserted asbestos claims at
face value.
Indeed, Asarco Inc. relates that its own review of a sample of
asbestos-related proofs of claims has uncovered glaring facial
deficiencies throughout the Debtors' asbestos claim universe,
rebutting any presumption of validity. Asarco Inc. says certain
of those claims assert US$1 million of liability or more.
Asarco Inc. asserts that there is no basis to pierce the
Asbestos Debtors' "corporate veils," and that ASARCO LLC is not
responsible for the asbestos claims filed against the Asbestos
Debtors.
Asarco Inc. says it intends to file objections to several
asbestos claims. However, Asarco Inc. notes that its claim
objections will describe certain confidential medical
information derived from the Proofs of Claim and include the
Proofs of Claim as exhibits. The Proofs Of Claim contain
medical information as well as the claimants' Social Security
Numbers.
Accordingly, Asarco Inc. seeks the Court's permission to file
its claims objections under seal.
(ASARCO Bankruptcy News, Issue No. 68; Bankruptcy Creditors'
Service, Inc. 215-945-7000 FAX 215-945-7001)
ASBESTOS ALERT: Appeals Court Favors Butlers in Case v. Domco
-------------------------------------------------------------
The Court of Appeals of Washington, Division 1, reversed the
ruling of the King County Superior Court, which had granted
summary judgment in favor of Domco Products Texas, L.P., in an
asbestos-related lawsuit filed by James T. Butler and Kathleen
Butler.
Judges William Baker, Ann Schindler and Becker entered judgment
of Case Nos. 58552-5-I, 58553-3-I, 58554-1-I on Feb. 19, 2008.
This suit originally involved 32 named defendants. Domco is the
only defendant involved in this appeal. Domco's predecessor,
Azrock Industries, Inc., manufactured vinyl asbestos tile.
Mr. Butler testified that he used Azrock tiles during his career
as a floor installer. In this appeal from the order dismissing
Mr. Butler's claim against Domco on summary judgment, the
primary question was whether Mr. Butler's evidence was
sufficient to prove that his use of Azrock tile exposed him to
asbestos.
Domco successfully moved for summary judgment.
Because Mr. Butler raised a reasonable inference that he worked
with older generation tiles that released asbestos fibers when
cut, and also established that his illness was caused by
cumulative exposure to asbestos, the order dismissing his claim
was reversed.
Domco Products Texas, L.P.
1705 Oliver St
Houston, Tex., 77007-3821
Phone: 713-869-5811
FAX: 713-864-9158
The Company manufactures hard surface floor coverings, other
adhesives and sealants, adhesives and sealants, and tape.
*********
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