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C L A S S A C T I O N R E P O R T E R
Tuesday, September 9, 2008, Vol. 10, No. 179
Headlines
ALIGN TECHNOLOGY: Court Considers Motions in OrthoClear Lawsuit
ALSTOM: Judge Allows N.Y. Securities Fraud Lawsuit to Proceed
CENTERLINE HOLDING: Awaits Final Approval of "Off" Settlement
CENTERLINE HOLDING: Securities Fraud Suit Still Pending in N.Y.
CHOICEPOINT INC: $10MM Settlement Ends Georgia Securities Suit
CHOICEPOINT INC: Court Sets Sept. 25 Hearing for "Fresco" Suit
CHOICEPOINT INC: Sept. 15 Hearing Set for "Mellot" Settlement
CHOICEPOINT INC: "Taylor" Matter Still Enjoined From Proceeding
DIRECT MARKETERS: Continues to Face "Cramming" Scams Lawsuits
ELI LILLY: Judge Allows Zyprexa Suit to Proceed as Class Action
HANARO TELECOM: Faces Suit After Chief Sold 6-Mln. Private Info.
IPEX: To Settle Nevada Suit Over Kitec Fittings for $90 Million
JEFFERSON COUNTY: Alabama Activist Group Sues Over County Debt
LDK SOLAR: Investors Seek Class Status in Securities Fraud Suit
LEGGETT & PLATT: Directors Sued Over Backdated Stock Options
NATURA PET: Faces Fla. Lawsuit Over "Premium Quality" Pet Food
PAN PHARMACEUTICALS: Faces AUD200-Million Lawsuit Over Losses
PASSAIC COUNTY: ACLU Sues Over Bad Conditions at County Jail
TELIK INC: Settles Securities Fraud Suit in N.Y. for $5 Million
U.S. EPA: Sends Notices to Workers in Connection with Bias Suit
WOODBURY: Court Says No to Thousands Joining Strip-Search Suit
New Securities Fraud Cases
GENERAL ELECTRIC: Scott+Scott Files Conn. Securities Fraud Suit
NATIONAL CITY: Brualdi Law Files Florida Securities Fraud Suit
QUEST ENERGY: KGS Files Securities Fraud Lawsuit in Oklahoma
QUEST ENERGY: Rosen Law Firm Files Okla. Securities Fraud Suit
SEMGROUP ENERGY: Murray Frank Files Securities Lawsuit in N.Y.
*********
ALIGN TECHNOLOGY: Court Considers Motions in OrthoClear Lawsuit
---------------------------------------------------------------
The U.S. District Court for the Southern District of New York
has yet to rule on motions in a purported class-action lawsuit
filed against Align Technology Inc., OrthoClear Inc., and
OrthoClear Holdings Inc.
The complaint, filed on behalf of Debra A. Weber and all others
similarly situated on May 18, 2007, alleges that orthodontic
treatments of the dental patient plaintiff "were interrupted,
unduly prolonged or terminated as a result of defendants'
unlawful conduct" relating to the OrthoClear Settlement.
OrthoClear Settlement
On Oct. 13, 2006, Align Technology entered into a formal
agreement with OrthoClear Inc., OrthoClear Holdings, and
OrthoClear Pakistan Pvt. Ltd. (OrthoClear), together with
certain individuals associated with OrthoClear to end all
pending litigation between the parties.
As part of the OrthoClear Settlement, OrthoClear agreed to stop
the importation of aligners into the U.S. and discontinue all
aligner business operations worldwide.
As a result, most OrthoClear patients were unable to complete
their orthodontic treatment with OrthoClear. In an attempt to
help minimize treatment disruptions for the OrthoClear patients
and their doctors, Align Tech committed to make treatment
available to these patients at no additional cost under the
"Patients First Program.“
Align Technology launched the Patients First Program to provide
new Invisalign treatment to former OrthoClear patients at no
charge to patients or their doctors.
Causes of Action
The "Weber" complaint alleges two causes of action against the
OrthoClear defendants and one cause of action against Align
Technology for breach of contract.
The cause of action against Align Technology references the
company's agreement to make Invisalign treatment available to
OrthoClear patients, alleging that Align failed "to provide the
promised treatment to Plaintiff or any of the Class Members."
On July 3, 2007, the company filed its answer to the complaint
and asserted 17 affirmative defenses. On July 20, 2007, the
company filed a motion for summary judgment on the Third Cause
of Action (the only cause of action alleged against Align).
On Aug. 24, 2007, Ms. Weber filed a motion for class
certification. On Oct. 1, 2007, the company filed an opposition
to the motion of class certification and it is currently
awaiting rulings from the Court.
OrthoClear has filed a motion to dismiss the case. The initial
case management conference and all discovery has been stayed
pending the Court's decision on the motion for class
certification, OrthoClear's motion to dismiss and Align's motion
for summary judgment, according to Align's Aug. 8, 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2008.
The suit is "Weber v. Align Technology, Inc., et al., Case No.
5:07-cv-00535-NAM-GJD," filed in the U.S. District Court for the
Southern District of New York, Judge Norman A. Mordue,
presiding.
Representing the plaintiff are:
Mark J. Schulte, Esq. (mschulte@hancocklaw.com)
Daniel B. Berman, Esq. (dberman@hancocklaw.com)
Maureen E. Maney, Esq. (mmaney@hancocklaw.com)
Zachary M. Mattison, Esq. (zmattison@hancocklaw.com)
Hancock, Estabrook Law Firm
P.O. Box 4976
1500 MONY Tower I
Syracuse, NY 13221-4976
Phone: 315-471-3151
Fax: 315-471-3167
315-233-4312
ALSTOM: Judge Allows N.Y. Securities Fraud Lawsuit to Proceed
-------------------------------------------------------------
Judge Victor Marrero of the U.S. District Court for the Southern
District of New York ruled that an investor class action lawsuit
alleging securities fraud can go forward against Alstom SA and
two former executives, Thomson Financial News reports.
The securities fraud suit is filed on behalf of all persons or
entities that purchased Alstom securities on Nov. 18, 1998,
through and including June 29, 2003.
Alstom is a French corporation engaged in the business of power
generation and transport infrastructure markets, including
electrical transmission and distribution, rail transportation,
and marine manufacturing. Alstom's U.S. headquarters is in
Windsor, Connecticut. The company is listed on the Paris Stock
Exchange and was previously listed on the New York and London
Stock Exchanges.
The case arises out of a series of disclosures by the company
beginning on Sept. 27, 2001. On that date, Renaissance Cruises,
which had been operating eight Alstom built cruise-ships, filed
for Chapter 11 protection.
In connection with this filing, Alstom disclosed for the first
time that it had guaranteed a large portion of the loans that
were issued to Renaissance Cruise to finance the purchase of the
cruise-ships. On Oct. 1, 2001, Alstom disclosed that its
exposure with respect to the loan guarantees to Renaissance
Cruises, and other undisclosed loan guarantees to other
customers for already delivered cruise-ships, was approximately
$1.1 billion.
As a result of these disclosures, Alstom's American Depository
Shares dropped from $22.71 on September 26, 2001, to $12.35
on October 3, 2001.
On June 30, 2003, Alstom disclosed that its wholly owned U.S.
subsidiary, Alstom Transportation, Inc., had "significantly
understated" losses in its accounts, in substantial part due to
"accounting improprieties by the understatement of actual costs
incurred."
At that time, Alstom recorded an additional net after tax charge
of 51 million euros for the year ended March 31, 2003. Then, on
Oct. 15, 2003, Alstom announced that it had increased the charge
to EUR73 million in connection with the financial improprieties
at ATI, and that its investigation of the accounting
improprieties had led the company to take an additional
EUR94 million charge for the year ended March 31, 2003 as a
result of "expected contract losses relating to a number of
performance issues." After the June 30, 2003 announcement of
the alleged ATI accounting improprieties, the ADSs dropped to
$3.41 per share.
On Jan. 7, 2004, Judge Marrero entered an order appointing
Bernstein Litowitz Berger & Grossmann LLP's client,
San Diego City Employees' Retirement System, as co-lead
plaintiff and Bernstein Litowitz Berger & Grossmann LLP as co-
lead counsel for the class in this action.
Consolidated Amended Complaint
The lead plaintiffs filed their consolidated amended complaint
on June 18, 2004. The defendants moved to dismiss the case, and
the lead plaintiffs opposed this request.
On Dec. 22, 2005, Judge Marrero issued three opinions resolving
the motions and allowing the lead plaintiffs to continue to
prosecute the case towards trial.
Judge Marrero held that the consolidated amended complaint
adequately alleges claims under Section 10(b) of the U.S.
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder against Alstom, former Alstom chairman and chief
executive Pierre Bilger, and former Alstom chief financial
officer Francois Newey relating to the undisclosed guarantees of
cruise ship purchasers' loans, and against ATI relating to the
understatement of ATI's costs.
Judge Marrero dismissed certain other claims, including claims
under the Securities Act of 1933 relating to Alstom's February
2001 secondary offering of common stock, based on statute of
limitations and other defenses.
The court also ruled that both purchasers of Alstom securities
on U.S. exchanges and non-U.S. purchasers of Alstom securities
on non-U.S. exchanges may be included in the plaintiff class for
the claims relating to the ATI fraud, but only purchasers of
Alstom securities on U.S. exchanges may be included in the
Plaintiff Class for the claims relating to the undisclosed
guarantees of cruise ship purchasers' loans.
Second Consolidated Amended Complaint
The lead plaintiffs took limited discovery relating to the ATI
fraud, as ordered in the court's Dec. 22, 2005 opinions, and
filed a motion for leave to file a second consolidated amended
complaint incorporating information from the limited discovery
on Feb. 24, 2006.
Judge Marrero granted the lead plaintiffs' motion for leave to
amend on March 10, 2006. Certain defendants moved to dismiss
the amended claims against them in the second consolidated
amended complaint.
Judge Marrero denied the motions to dismiss on Sept. 29, 2006.
The lead plaintiffs filed a revised second consolidated amended
complaint on Nov. 29, 2006 (Class Action Reporter, Jan. 18,
2007).
Recent Ruling
Recently, Judge Marrero ruled that the investor class action can
go forward against Alstom SA and the two former executives.
Judge Marrero also ruled that the French plaintiffs must bring
their claims in French courts and that English and Dutch
plaintiffs can participate only in U.S. claims against the
former executives and U.S. subsidiaries.
The judge also modified the time frame covered by the lawsuit to
between Aug. 3, 1999, to Aug. 6, 2003, from a wider window
sought by plaintiffs.
An Alstom spokesman said "there is still no decision" on the
company's response to the ruling. "The legal process is still
going on," he said.
CENTERLINE HOLDING: Awaits Final Approval of "Off" Settlement
-------------------------------------------------------------
The Delaware Court of Chancery has yet to rule on a settlement
in a putative class and derivative action lawsuit against
Centerline Holding Co., which deal could lead to the possible
resolution of several similar cases filed against the company.
On Jan. 15, 2008, the first of the state law cases, a putative
class and derivative action, entitled "Off v. Ross, CA No. 3468-
VCP," was filed against the company, its board of trustees and
The Related Companies, LP, before the Delaware Court of
Chancery.
The lawsuit concerns the company's sale of a new issue of
convertible preferred stock to an affiliate of TRCLP. It
alleges claims for breach of fiduciary duty against the Trustees
and seeks an unspecified amount of compensatory damages from
them as well as injunctive relief against all defendants.
Thereafter, seven other derivative lawsuits asserting similar
claims were filed in state and federal courts in New York and in
the Delaware Chancery Court. Four of these later-filed actions
also allege that the trustees breached their fiduciary duties to
the company by allegedly violating the federal securities laws.
The seven derivative actions filed subsequent to the "Off" case
are:
1. "Kramer v. Ross, et al., Index. No. 100861-08," which
was filed on Jan. 18, 2008, against the company and its
board of trustees, in New York County Supreme Court;
2. "Carfagno v. Schnitzer, et al., No. 08-CV-00912," which
was filed on Jan. 25, 2008, against the company and its
board of trustees in the U.S. District Court for the
Southern District of New York;
3. "Ciszerk v. Ross, et al., CA No. 3511," which was filed
on Jan. 30, 2008, against the company, its board of
trustees and The Related Companies, L.P., before the
Delaware Court of Chancery;
4. "Kanter v. Ross, et al., 08 Civ. 01827," which was filed
on Feb. 22, 2008, against the company, its board of
trustees and The Related Companies L.P. in the U.S.
District Court for the Southern District of New York;
5. "Broy v. Centerline Holding Company, et al., Case No. 08-
CV-01971," which was filed on Feb. 27, 2008, against the
company and certain of its officers and trustees before
the U.S. District Court for the Southern District of
New York;
6. "Kastner v. Schnitzer et al., Index No. 601043-08," which
was filed on April 10, 2008, against the company and its
board of trustees, in the New York Supreme Court; and
7. "Kostecka v. Schnitzer et al., Index No. 601044-08,"
which was filed on April 10, 2008, against the company
and its board of trustees, in the New York Supreme Court.
The company is named solely as a nominal defendant in all eight
derivative actions and no monetary relief is sought against it
in any of those cases.
On April 28, 2008, a consolidated amended verified complaint
alleging breaches of fiduciary duties of loyalty, candor, due
care, fair dealing, waste of corporate assets and unjust
enrichment, was filed against the company and its board of
trustees in "Carfagno" and "Broy," which are pending with the
U.S. District Court for the Southern District of New York.
The consolidated action is styled both as a derivative suit and
as a class action on behalf of all holders of Centerline
securities who qualified to purchase the company's 11.0%
preferred shares pursuant to the rights offering but who did not
do so.
Meanwhile, the company has negotiated a settlement with the
plaintiff in the "Off" case based on the rights offering and
which is subject to court approval.
An initial hearing for approval of the "Off" settlement was held
on May 23, 2008, and a second hearing was held on July 15, 2008.
The company is currently awaiting the judge's decision regarding
the settlement, according to the company's Aug. 8, 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2008.
Centerline Holding Co. -- http://www.centerline.com/-- formerly
CharterMac, is an alternative asset manager focused on real
estate funds and financing. The company had $11.9 billion of
assets under management as of Dec. 31, 2007. Organized as a
statutory trust, the company conducts substantially all of its
business through its subsidiaries generally under the
designation Centerline Capital Group. The company operates in
four groups: Affordable Housing, Commercial Real Estate,
Portfolio Management and Credit Risk Products. The Affordable
Housing and Commercial Real Estate groups raise capital through
a series of funds to deploy into an array of real estate debt
and equity investments. The Portfolio Management group monitors
and services the investments within its funds and servicing
portfolio. The Credit Risk Products group provides credit
support to affordable housing debt and equity products investing
in syndicated corporate debt.
CENTERLINE HOLDING: Securities Fraud Suit Still Pending in N.Y.
---------------------------------------------------------------
Centerline Holding Co. is facing a consolidated securities fraud
class-action suit before the U.S. District Court for the
Southern District of New York.
On Jan. 18, 2008, the first of the federal securities putative
class-action suits was filed against the company and certain of
its officers and trustees. Thereafter, five other essentially
duplicative putative class actions were also filed before the
same court.
Each complaint asserts that the company and the other defendants
violated federal securities law by failing to disclose in a
timely fashion its recently announced transaction with Freddie
Mac. Each complaint seeks an unspecified amount of compensatory
damages and other relief.
The federal lawsuits are:
-- "Goldstein v. Centerline Holding Company, et al., No.
08 CV 00505," filed on Jan. 18, 2008;
-- "Frank v. Centerline Holding Company, et al., No. 08
CV 01026," filed on Jan. 31, 2008;
-- "Weinrib v. Centerline Holding Company, et al., No.
08 CV 01158," filed on Feb. 4, 2008;
-- "Lyons v. Centerline Holding Company, et al., No. 08
CV 01458," filed on Feb. 11, 2008;
-- "Dechter v. Centerline Holding Company, et al., No.
08 CV 01593," filed on Feb. 15, 2008;
-- "Quill v. Centerline Holding Co., Inc, et al., No.
08 CV 01902," filed on Feb. 26, 2008.
The cases were eventually consolidated as "In re Centerline
Holding Company Securities Litigation, Case No. 08-00505," and,
on May 5, 2008, the Court designated Centerline Investor Group,
which is made up of several shareholders, as lead plaintiff for
the cases.
The consolidated complaint alleges violations of the federal
securities laws in connection with the company's announcement of
the Freddie Mac transaction, changes to the company's business
model, and the reduction in dividend guidance policy. It seeks
an unspecified amount of compensatory damages and other relief
on behalf of all persons or entities that purchased the common
stock of Centerline Holding Co. during the period March 12,
2007, through Dec. 28, 2007.
The consolidated case is still pending with the court, and the
company reported no further development regarding the matter in
its Aug. 8, 2008 Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2008.
The suit is "In re Centerline Holding Company Securities
Litigation, Case No. 1:08-cv-00505-SAS," filed in the U.S.
District Court for the Southern District of New York, Judge
Shira A. Scheindlin, presiding.
Representing the plaintiffs are:
Christopher J. Keller, Esq. (ckeller@labaton.com)
Labaton Sucharow, LLP
140 Broadway
New York, NY 10005
Phone: 212-907-0700
Fax: 212-818-0477
- and -
James Clayton Kelly, Esq. (jkelly@wolfpopper.com)
Wolf Popper LLP
845 Third Avenue
New York, NY 10022
Phone: 212-451-9635
Fax: 212-486-2093
Representing the defendants are:
Jennifer Fletcher Beltrami, Esq.
(jbeltrami@wolfblock.com)
Wolf Block Schorr and Solis-Cohen, LLP
250 Park Avenue
New York, NY 10177
Phone: 212-883-4955
Fax: 212-672-1155
- and -
Daniel J. Leffell, Esq. (dleffell@paulweiss.com)
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019
Phone: 212-373-3218
Fax: 212-492-0218
CHOICEPOINT INC: $10MM Settlement Ends Georgia Securities Suit
--------------------------------------------------------------
The U.S. District Court for the Northern District of Georgia
granted final approval to the $10-million settlement of a
consolidated securities fraud class-action lawsuit filed against
ChoicePoint, Inc., according to the company's Aug. 8, 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2008.
Initially, on March 4, 2005, a purchaser of the company's
securities filed a lawsuit against the company and certain of
its officers before 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 the same month by other
purchasers of the company's securities before the U.S. District
Courts for the Central District of California and for the
Northern District of Georgia.
By court order, the cases pending in California were transferred
to the U.S. District Court for the Northern District of Georgia.
On Aug. 5, 2005, the Georgia court consolidated the pending
cases into a single consolidated action, captioned "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 of the suit as a class action and seeking
unspecified compensatory damages, attorneys' fees, costs, and
other relief.
On March 14, 2006, the defendants filed a motion to dismiss the
consolidated amended complaint, which request was later denied
by the court.
Thereafter, the defendants moved the court to certify its order
for immediate review. The court granted that motion and 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.
However, on Jan. 15, 2008, the company entered into a Letter of
Understanding pursuant to which the parties to the lawsuit would
settle all claims, subject to notice to the class, court
approval and certain other conditions.
Under the terms of the Letter of Understanding, the company will
pay $10 million to the plaintiffs and the company and the other
defendants do not admit to any liability.
On March 24, 2008, the court issued an order preliminarily
approving the settlement. On July 21, 2008, the court issued a
Final Judgment and Order of Dismissal with Prejudice, approving
the terms of the settlement and dismissing the litigation with
prejudice.
The suit is "In re ChoicePoint Inc. Securities Litigation, 1:05-
CV-00686," filed before 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: Court Sets Sept. 25 Hearing for "Fresco" Suit
--------------------------------------------------------------
The U.S. Court of Appeals for the Eleventh Circuit set a
Sept. 25, 2008 hearing date for certain motions in the class-
action suit captioned "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 lawsuit was filed on Aug. 11, 2003, in 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 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 Interveners and the putative class
members in the case, "Taylor v. Acxiom Corp.," 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 issued an
order dated June 6, 2007, questioning whether it has
jurisdiction over the appeal.
On Sept. 24, 2007, the Court of Appeals issued an order
declining jurisdiction of the Texas Interveners' Motion to
Intervene and finding that it did have jurisdiction to decide
permissibility of the preliminary approval order's injunction
against pursuing related proceedings in other Courts.
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 Court of Appeals has scheduled for Sept. 25, 2008, an oral
argument for the Texas Interveners' appeal of the District
Court's denial of plaintiffs' motion to intervene and its
inclusion of the injunction to maintain the status quo,
according to the company's Aug. 8, 2008 Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter
ended June 30, 2008.
The suit is "Richard Fresco, et al. v. Automotive Directions,
Inc., et al., Case No. CIV-03-61063-Martinez/Klein," filed in
the U.S. District Court for the Southern District of Florida,
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
CHOICEPOINT INC: Sept. 15 Hearing Set for "Mellot" Settlement
-------------------------------------------------------------
The U.S. District Court for the Northern District of Georgia has
scheduled a hearing on Sept. 15, 2008, to consider final
approval of a proposed settlement in the matter captioned
"Curtis R. Mellot v. ChoicePoint Inc., et al., Case No. 1:05-cv-
01340-JTC."
The class action lawsuit accuses ChoicePoint of violating the
Employee Retirement Income Security Act. The suit was filed on
May 20, 2005, before 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
Plan's acquisition and retention of ChoicePoint stock 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 lawsuit. 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 June 12, 2008, the District Court approved the deal on an
interim basis. Accordingly a hearing for final approval is set
for Sept. 15, 2008, according to the company's Aug. 8, 2008 Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2008.
The suit is "Curtis R. Mellot v. ChoicePoint Inc., et al., Case
No. 1:05-cv-01340-JTC," filed before 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: "Taylor" Matter Still Enjoined From Proceeding
---------------------------------------------------------------
The class-action lawsuit "Taylor v. Acxiom Corp.," which is
pending against ChoicePoint, Inc., in 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 named 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.
The 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 filed first,
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.
Thus, the "Taylor" litigation is currently enjoined from
proceeding pursuant to the District Court's order issued in
"Fresco," according to the company's Aug. 8, 2008 Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2008.
The suit is "Taylor et al. v. Acxiom Corp. et al., Case No.
2:07-cv-00001-TJW," filed in 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
DIRECT MARKETERS: Continues to Face "Cramming" Scams Lawsuits
-------------------------------------------------------------
VistaPrint, Vertrue and Adaptive Marketing are facing a class-
action complaint filed in the U.S. District Court for the
District of Nevada accusing the companies of running one of the
nation's largest "cramming" scams, CourtHouse News Service
reports.
"Cramming" refers to the practice of imposing unauthorized
charges on consumers, the report explains.
The three companies run a scam and make unauthorized charges on
consumers' credit and debit cards, claims plaintiff Susan
Olmsted, who notes that Vertrue reported $659 million of income
in a single year.
Ms. Olmsted says she bought business cards in March from
VistaPrint.com, an online supplier of graphic services, and paid
with her debit card. However, before she could proceed to
checkout, the Web site asked her for personal information,
including her name, card number and expiration date, to enroll
her in a so-called "rewards program" that promised discounts on
various items.
Since then, Ms. Olmsted says, the defendants have been taking
monthly fees from her bank account without her knowledge or
consent. "Membership fees" cost between $12.95 and $14.95 per
month.
The plaintiff brings this action as a class action pursuant to
Rule of Civil Procedure 23(a) and (b)(3), on behalf of:
(1) all persons and entities who were charged fees or
interest by Vertrue and Adaptive Marketing and
VistaPrint for on or more membership programs
maintained by Vertrue during the period from Sept. 2,
2003 to the present;
(2) all persons and entities whose credit card, bank debit
card, or bank account information was obtained and
intercepted by Vertrue and Adaptive Marketing and
VistaPrint for on or more membership programs
maintained by Vertrue during the period from Sept. 2,
2003 to the present;
(3) all persons and entities whose credit card, bank debit
card, or bank account information was diclosed by
Vertrue and Adaptive Marketing and VistaPrint for
on or more membership programs maintained by Vertrue
during the period from Sept. 2, 2003, to the present;
and
(4) all persons and entities who were charged fees or
interest by Vertrue and Adaptive Marketing and
VistaPrint for one or more Membership Programs
maintained by Vertrue and Adaptive Marketing and
whose bank debit cards or bank accounts were charged.
The plaintiff wants the court to rule on:
(a) whether defendants developed and implemented a scheme
to intentionally create unauthorized membership program
accounts and to charge consumers for such accounts;
(b) whether defendants conspired with each other to
intentionally create unauthorized membership program
accounts and to charge consumers for such accounts;
(c) whether defendants violated the Electronic
Communications Privacy Act (ECPA), 18 USC Section
2510;
(d) whether defendants made "preauthorized electronic fund
transfers," within the meaning of the Electronic Funds
Transfer Act (EFTA), 15 USC Section 1693a(9) and
Section 1693e, from the accounts of class members;
(e) whether defendants had a duty under EFTA to obtain
authorization in writing before debiting membership
fees and initiating preauthorized electronic fund
transfers from the accounts of class members;
(f) whether defendants had a duty under EFTA to provide
class members a copy of their written authorization to
debit membership fees and initiate preauthorized
electronic fund transfers from their accounts;
(g) whether defendants complied with the requirements of
EFTA in connection with the debits and preauthorized
electronic fund transfers defendants initiated from the
accounts of class members;
(h) whether defendants have violated EFTA, 15 USC Section
1693e;
(i) whether defendants' acts and practices are likely to
deceive reasonable members of the public;
(j) whether defendants' acts and practices are immoral,
unethical, oppressive, unscrupulous, or substantially
injurious to consumers;
(k) whether the justification for defendants' acts and
practices are outweighed by the gravity of harm to the
victims;
(l) whether defendants' acts and practices violate Nevada's
legislatively declared policies or common law
principles as alleged;
(m) whether defendants have violated the Nevada Deceptive
Trade Practices statutes, Nev. Rev. Stat. 598.0903 et
seq.;
(n) whether defendants have been unjustly enriched;
(o) whether the class has sustained damages as a result of
defendants' conduct, and, if so, what is the
appropriate measure of damages;
(p) whether the class is entitled to declaratory and/or
injunctive relief to enjoin the unlawful conduct
alleged; and
(q) whether the class is entitled to punitive damages, and
if so, in what amount.
The plaintiff asks the court for:
-- an order certifying the proposed class under Rule 23
of the Federal Rules of Civil Procedure and appointing
plaintiffs and their counsel of record to represent the
proposed class;
-- an order declaring that defendants have violated the
Electronic Funds Transfer Act, 15 USC Section 1693 et
seq.;
-- an order declaring that defendants have violated the
Electronic Communications Privacy Act, 18 USC Section
2520(b)(2) and (c);
-- an order declaring that defendants have violated the
Nevada Deceptive Trade Practices statutes, Nev. Rev.
Stat. 598.0903 et seq.;
-- an order enjoining defendants' wrongful conduct;
-- an order awarding plaintiff and the class
restitution of all money acquired by defendants from
plaintiff and class members;
-- an order that defendants disgorge all profits from
unfair competition;
-- an order awarding plaintiff and the class actual and
statutory damages and interest thereon, pursuant to 15
USC Section 1693m;
-- an order awarding plaintiff and the class
compensatory and consequential damages in an amount to
be proven at trial, together with interest thereon;
-- an order awarding plaintiff and the class treble
damages;
-- an order awarding plaintiff and the class attorneys'
fees and costs of suit, including expert witness fees;
-- an order awarding plaintiff and the class pre-
judgment and post-judgment interest;
-- an order awarding plaintiff and the class such other
and further relief as the court deems just and proper.
The suit is "Susan Olmstead, et al. v. VistaPrint Ltd. et al.,
Case 2:08-cv-01164-RCJ-RJJ," filed in the U.S. District Court
for the District of Nevada.
Representing the plaintiffs are:
William M. O'Mara, Esq.
Brian O. O'Mara, Esq.
David C. O'Mara, Esq.
The O'Mara Law Firm PC
311 East Liberty Street
Reno, NV 89501
Phone: 775-323-1321
Fax: 775-323-4082
ELI LILLY: Judge Allows Zyprexa Suit to Proceed as Class Action
---------------------------------------------------------------
Judge Jack Weinstein, of U.S. District Court for the Eastern
District of New York, has ruled that pension funds, labor unions
and insurance companies may proceed as a class in their case
against Eli Lilly and Co. over its schizophrenia drug Zyprexa,
Indianapolis Star reports.
According to Indianapolis Business Journal, Judge Weinstein
certified the class-action lawsuit against Lilly in a 295-page
ruling issued on September 5, 2008.
Mark Fass, of the New York Law Journal, relates that the recent
ruling was a partial victory for both sides, as Judge Weinstein
certified only the plaintiffs' Racketeer Influenced and Corrupt
Organizations Act claims and not their state-law ones. The
judge also declined to certify a class of individual-payor
claims.
IBJ notes that individuals were denied class action status
because, the judge said, their leaders, who are suing Lilly for
injury, are in a conflict of interest.
"Total denial of certification would constitute the death knell
of the action," Judge Weinstein wrote in 'Zyprexa Products
Liability Litigation, 04-MD-1596.' "Almost all plaintiffs'
claims would be too small to individually support this costly
litigation. Under such circumstances, absent an unusual
situation, the rule to be applied in deciding to deny
certification is essentially that for summary judgment."
IBJ recounts that the plaintiffs in the case claim Lilly urged
physicians to prescribe the schizophrenia and bipolar disorder
drug for uses not approved by the federal government. NYLJ also
says that the plaintiffs claim that the drug giant committed
fraud by overpricing its anti-psychotic drug Zyprexa while
overstating the drug's utility and understating its drawbacks.
According NYLJ, Judge Weinstein's decision also marks the
apparent end of the controversy surrounding approximately 350
sealed documents that were obtained in a legal end run by New
York Times reporter Alex Berenson.
The NYLJ notes that 18 months after Judge Weinstein derided the
"conspiracy" orchestrated by Mr. Berenson and two sympathetic
attorneys to obtain the documents -- primarily internal Lilly
documents and e-mails between its top managers -- the judge
ordered the documents unsealed.
"Public access is now advisable because this litigation involves
issues of great public interest, the health of hundreds of
thousands of people, fundamental questions about our system of
approval and monitoring of pharmaceutical products, and the
funding for many health and insurance benefit plans," Judge
Weinstein wrote. "Public and private agencies and organizations
have a right to be informed. At this stage public disclosure,
congruent with our long tradition of open courts, is desirable."
Judge Weinstein has now ordered the seal removed, though he
referred the unsealing to a special master to "avoid any
unnecessary embarrassment" to any party, NYLJ says.
"Based on this country's long-standing tradition of open access
to the courts and court records, the enormous number of people
who have taken or will take Zyprexa, the involvement of
government regulatory bodies, absent class members' interest in
the proceeding, and the age of the documents, the motions to
unseal are granted," Judge Weinstein wrote.
NYLJ points out that the recently certified class action suit is
one of the larger suits in the mass of claims waged against
Lilly over the last five years regarding Zyprexa, which the
company began marketing in 1996 as a wonder drug for
schizophrenia and later, bipolar disorder. Zyprexa, the report
recounts, quickly became one of Lilly's top sellers, with more
than 12 million users and billions of dollars in annual sales.
However, beginning in 2000, a number of studies linked Zyprexa
to serious health concerns, the report further recalls. In
2006, the Times published the first of its reports on the drug,
which alleged that Lilly and its officers misrepresented or
failed to disclose Zyprexa's link to diabetes, obesity and
heightened blood sugar. As a result, tens of thousands of
Zyprexa users, investors and third-party payors filed suits,
including: 30,000 personal injury claims; civil and criminal
cases filed by attorneys general; a securities class action
recently dismissed as time barred by Weinstein; and the present
class action, initiated on behalf of tens of thousands of
insurers and unions.
Eli Lilly and Co. -- http://www.lilly.com/-- discovers,
develops, manufactures and sells products in one business
segment, pharmaceutical products. The Company also has an
animal health business segment. It manufactures and distributes
its products through owned or leased facilities in the U.S.,
Puerto Rico and 25 other countries. Eli Lilly and Company's
products are sold in approximately 135 countries. The Company
also conducts research to find products to treat diseases in
animals and to increase the efficiency of animal food
production.
HANARO TELECOM: Faces Suit After Chief Sold 6-Mln. Private Info.
----------------------------------------------------------------
Hanarotelecom Inc., a fixed-line operator, is facing a class-
action lawsuit after its former boss was found to have sold the
private information of 6 million users to telemarketers, Trading
Markets reports.
In May 2008, the police revealed that several former managers,
including Hanarotelecom's former president, allegedly sold the
private information, including resident registration and phone
numbers, of some 6 million users to telemarketing companies over
the past two years (Class Action Reporter, May 2, 2008).
Headquartered in Seoul, South Korea, Hanaro Telecom Inc --
http://www.hanaro.com/-- provides telecommunications services
and offers high-speed broadband Internet access, voice, leased
line and Internet data center (IDC) services in Korea. Its
high-speed broadband Internet service includes integrated
telecommunication services, broadband and other Internet related
services. Its voice service comprises local, domestic long
distance, international long distance and voice over Internet
protocol (VoIP) services. As of March 31, 2007, it had 3.66
million broadband Internet access subscribers. Broadband
Internet access services and voice services accounted for 59.6%
and 40.4% of its revenues for the year ended December 31, 2007.
The Company provides broadband Internet access and voice
services under the hanafos and hanafone brands, respectively.
The Company also provides Internet data center service and
private leased circuit service for enterprises.
IPEX: To Settle Nevada Suit Over Kitec Fittings for $90 Million
---------------------------------------------------------------
Ipex, the Canadian manufacturer and distributor of Kitec
fittings, has reached a tentative $90-million settlement with
legal representatives of an estimated 34,000 homeowners across
the Las Vegas Valley, Brian Eckhouse writes for Las Vegas Sun.
As reported in the Class Action Reporter on Feb 23, 2007, a
class action lawsuit filed against the manufacturers of Kitec
brass plumbing fittings had been expanded to include potentially
35,000 to 50,000 homes throughout the Las Vegas Valley.
According to the CAR report, the suit started in 2006 with about
1,000 homes in Sun City MacDonald Ranch. Randall Jones, Esq.,
of Harrison Kemp Jones & Coulthard, said the class action
includes all owners of homes in Clark County with Kitec brass
plumbing fittings.
The defendants named in the lawsuit are Kitec maker IPEX,
Classic Plumbing, Sharp Plumbing and Cox & Sons Plumbing. The
case alleges that extensive corrosion and crystallization caused
by chemical reaction occurs where Kitec is coupled with
polyurethene-based tubing result in plumbing problems such as
leaks, reduced water flow and breaks.
The suit was certified as a class action by Clark County
District Court Judge Timothy Williams.
Las Vegas Sun notes that Ipex had resisted a financial
settlement, arguing that homebuilders and plumbers should have
known the valley's hard water would corrode the inside of the
brass fittings. The leached zinc tends to build up in the
connecting pipes, which could cause pipes to rupture or explode,
damaging walls and floors.
However, Ipex decided to avoid further litigation by settling
without admitting liability, the report says.
The $90-million settlement, according to Las Vegas Sun, was
negotiated by Harrison Kemp on behalf of the homeowners, who
each sought to collect $10,000 in damages.
Homebuilder Richmond American Homes of Nevada has agreed to a
$10.2-million settlement to replumb 1,200 homes built in the Las
Vegas area, the report says.
The settlement in the suit is scheduled to be reviewed this week
by Judge Williams. If approved, the $90 million will be placed
in an interest-bearing trust while litigation continues against
the other homebuilders and plumbers.
Las Vegas Sun relates that there have been similar Kitec-related
suits throughout the Southwest, but the product is still
distributed and used in Kansas and elsewhere without incident.
The lawsuits that are yet unresolved are those naming developers
and plumbing companies that installed the product.
For more details, contact:
Harrison, Kemp, Jones & Coulthard
Phone: 702-385-6000
Fax: 702-385-6001
Web site: http://www.hkj-law.com/
JEFFERSON COUNTY: Alabama Activist Group Sues Over County Debt
--------------------------------------------------------------
An Alabama activist group has filed a lawsuit seeking to cancel
$6.6 billion in debt and related swaps issued by Jefferson
County, The Washington Post reports.
According to Washington Post, the suit -- filed on Aug. 28,
2008, by Citizens for Sewer Accountability Inc. and two
residents, Carnell Fowler and William Young -- claims that the
county faces financial disaster because of misdeeds by Wall
Street firms, corrupt local politicians and others.
The lawsuit, filed in Jefferson County Circuit Court under a
state law that allows citizens to sue parties corrupting
government, names as defendants several Wall Street banks and
leading local politicians, including Birmingham Mayor Larry
Langford.
The report points out that Birmingham, Alabama's largest city,
is located in Jefferson County.
The banks named in the suit specifically include JPMorgan Chase
& Co. and Goldman Sachs Capital Markets Inc. The suit also
names as defendants Alabama bond dealer William Blount, who was
previously president of the Jefferson County Commission; his
firm, Blount Parrish; lobbyist Albert LaPierre, and investment
banker Charles LeCroy.
Other defendants in the suit are: Bear Stearns Capital Markets
Inc, which has since been acquired by JPMorgan; Sterne, Agee &
Leech Inc; Bank of America Corp.; CDR Financial Services Inc.;
and bond insurers such as XL Capital Assurance.
"We intend to hold Wall Street accountable for its role in the
county's auction-rate bond and swaps debacle," James O'Neal,
Esq., the lawyer who filed the suit, is quoted by Washington
Post as saying. "The county has been victimized by unscrupulous
investment bankers and faces an unprecedented financial crisis."
Washington Post relates that the lawsuit comes as creditors and
county officials negotiate on a possible restructuring of
$3.2 billion of Jefferson County debt obligations. The report
recounts that a week ago, creditors and county officials, with
the help of Alabama Gov. Bob Riley, agreed to bargain further on
a restructuring of the debt and backed away from a possible
Chapter 9 municipal bankruptcy filing by Jefferson County.
Such a filing by Jefferson County would be the biggest by a U.S.
local government since Orange County, California, filed for
protection in December 1994, the report notes.
In their 47-page complaint, the named plaintiffs ask that the
court invalidate Jefferson County's $2.2 billion in Series 2003B
and C sewer auction-rate bonds, as well as $4.2 billion in
related interest-rate swaps. The suit asks for unspecified
damages.
The suit claims that Mayor Langford and others took payments in
exchange for awarding the bonds and swaps businesses when Mayor
Langford headed the county council.
Regulators at the U.S. Securities and Exchange Commission also
have sued Mayor Langford and others, saying that the mayor took
more than $156,000 for steering interest-rate swap agreements in
2003 and 2004 to Mr. Blount's firm.
According to Washington Post, the suit follows an earlier one
filed by other Jefferson County residents and seeks class-action
status.
LDK SOLAR: Investors Seek Class Status in Securities Fraud Suit
---------------------------------------------------------------
Investors are fighting for class certification in a lawsuit
alleging that LDK Solar Co. Ltd. and its executives committed a
"massive" securities fraud by inflating the value of the
company’s inventory of raw materials and understating the costs
of producing solar wafers, which are used in devices that
convert sunlight into electricity, The Standford Law School
Securities Class Action ClearingHouse reports.
In October 2007, the law firm of Schatz Nobel Izard P.C. filed
the lawsuit seeking class-action status in the United States
District Court for the Northern District of California on behalf
of all persons who purchased or otherwise acquired the American
Depository Shares of LDK Solar between August 1, 2007, and
October 3, 2007, inclusive (Class Action Reporter, Oct 12,
2007).
The Complaint charges that LDK, a manufacturer of
multicrystalline solar wafers, and certain of its officers and
directors violated federal securities laws. The Complaint
alleges that, prior to and during the Class Period, the
defendants issued false statements describing LDK's business
fundamentals, financial results and earnings growth potential.
Specifically, the defendants concealed that LDK's internal
controls were flawed, preventing it from accurately measuring or
reporting its inventory. As a result, the company's inventories
were materially overstated, causing inflation in LDK's assets,
earnings and earnings per share reported during the Class
Period.
On October 3, 2007, it was reported that LDK's Financial
Controller, Charley Situ, had resigned, stating that LDK lacked
internal controls and that the company's reported inventory of
polysilicon was overstated by 25%. Then on October 4, 2007, LDK
disclosed that it would have an independent outside auditor
investigate Mr. Situ's allegations. In response to this news,
the company's ADS, which traded as high as $76.75 on Sept. 27,
2007, plummeted to as low as $44.98, and closed at $48.30 on
Oct. 4, 2007.
"The uniform misrepresentations made to the entire market for
LDK securities had the effect of artificially inflating the
market price for LDK's American depository shares, and hence
inflating the prices of its call options and decreasing the
prices of its put options," the plaintiffs said.
"When the truth about the company's inventory began to emerge,
the price of LDK's ADSes dropped dramatically, causing
substantial losses to LDK's investors."
Recently, the plaintiffs said in court documents filed in the
U.S. District Court for the Northern District of California that
the case was "perfectly suited" for treatment on a classwide
basis because the class is so numerous that joinder of all the
members would be impracticable, common questions of law and fact
dominate the case, and the proposed class representative has
typical claims of the class and is an "adequate and appropriate"
representative.
In seeking class certification, the plaintiffs said that the
case, like other securities fraud class actions, alleges that
the defendants misled the entire market for the company's
securities, and that all persons who purchased the securities
during the period when the misrepresentations inflated the
market price were damaged in the same way.
For more information, contact:
Wayne T. Boulton, Esq.
Nancy A. Kulesa, Esq.
Schatz Nobel Izard, P.C.
Phone: 800-797-5499
e-mail: firm@snilaw.com
Web site: http://www.snilaw.com/
LEGGETT & PLATT: Directors Sued Over Backdated Stock Options
------------------------------------------------------------
Directors of Leggett & Platt are facing a derivative complaint
filed in the U.S. District Court for the Western District of
Missouri alleging they "secretly backdated" millions of stock
options for themselves, filed false financial statements, and
lied to shareholders, CourtHouse News Service reports.
Leggett & Platt makes mattress components.
According to the complaint, qualitative factors that can make a
misstated fact material include:
(a) whether the misstatement has the effect of increasing
management's compensation -- for example, by satisfying
requirements for the award of bonuses or other forms of
incentive compensation;
(b) whether the misstatement arises from an item "capable
of precise measurement;"
(c) whether misstatement masks a change in earnings;
(d) whether the misstatement concerns a segment or other
portion of the registrant's business that has been
identified as playing a significant role in the
registrant's operations or profitability; and
(e) whether the misstatement affects the registrant's
compliance with regulatory requirements.
The plaintiffs asks the court to enter judgment:
-- awarding money damages against all defendants, jointly
and severally, for all losses and damages suffered as a
result of the acts and transactions complained of,
together with pre-judgment interest, to ensure
defendants do not participate therein or benefit
thereby;
-- directing all defendants to account for all damages
caused by them and all profits and special benefits and
unjust enrichment they have obtained as a result of
their unlawful conduct, including all salaries, bonuses,
fees, stock awards, options and common stock sale
proceeds, and imposing a constructive trust thereon;
-- directing Leggett to take all necessary actions to
reform and improve its corporate governance and internal
control procedures to comply with applicable law,
including, but not limited to, putting forward for a
shareholder vote resolutions for amendments to the
company's by-laws or articles of incorporation and
taking such other action as may be necessary to place
before shareholders for a vote adoption of the following
Corporate Governance policies:
(1) a proposal requiring that the office of CEO of
Leggett and Chairman of the Leggett's Board of
Directors be permanently held by separated
individuals and that the Chairman of the Leggett
Board meets rigorous "independent" standards;
(2) a proposal to strengthen the Leggett Board's
supervision of operations and develop and implement
procedures for greater shareholder input into the
policies and guidelines of the Board;
(3) appropriately test and then strengthen the internal
audit and control function;
(4) rotate independent auditioning firms every five
years;
(5) control and limit insider stock selling and the
terms and timing of stock option grants; and
(6) reform executive compensation.
-- ordering the imposition of a constructive trust over
defendants' stock options and any proceeds derived
therefrom;
-- awarding punitive damages;
-- as to all improperly dater and improperly priced
options that have been exercised, ordering defendants to
make a payment to the company in an amount equal to the
difference between the prices at which the options were
exercised and the exercise prices the options should
have carried if they were priced at fair market value on
the actual date of grant;
-- as to all improperly dated and improperly priced
options that have been granted but not yet exercised or
expired, ordering the company to rescind such options so
they carry the exercise prices they should have carried
if they were priced at fair market value on the actual
date of grant;
-- awarding costs and disbursements of this action,
including reasonable attorneys' accountants' and
experts' fees; and
-- granting such other and further relief as the court may
deem just and proper.
The suit is "New England Carpenters Pension Fund, et al. v.
David S. Haffner, et al., Case No. 08-4220-CV-C-NKL," filed in
the U.S. District Court for the Western District of Missouri.
Representing the plaintiffs are:
Don R. Lolli, Esq. (dlolli@sysarttaylor.com)
Patrick Kaine, Esq. (pkaine@sysarttaylor.com)
Dysart Taylor Lay Cotter & McMonigle PC
4420 Madison Avenue
Kansas City, MO 64111
Phone: 816-931-2700
Fax: 816-931-7377
NATURA PET: Faces Fla. Lawsuit Over "Premium Quality" Pet Food
--------------------------------------------------------------
Natura Pet Products is facing a class-action complaint filed in
the U.S. District Court for the Southern District of Florida
alleging it misrepresented its pet food as "premium quality,"
but pets have died from eating it, CourtHouse News Service
reports.
This is a class action brought on behalf of all consumers who
have purchased Natura's commercial pet food and treats that were
manufactured, marketed, distributed and sold by Natura.
The plaintiffs claim the food is "made wholly or partially of
inedible garbage" including "restaurant grease, roadkill, hair,
blood, pus . . . excrement . . . moldy grains, hulls, Styrofoam
packaging from discarded supermarket meat, euthanized animals,
including cats and dogs, and/or diseased, dying, disabled and
dead animals."
The plaintiffs bring this action for injunctive relief,
restitution and damages for:
(1) false and deceptive advertising, misrepresentations and
omissions made by Natura in the marketing, advertising
and sale of Natura's commercial pet food;
(2) for the illness and deaths of the plaintiffs' cats
and dogs from ingesting Natura's commercial pet food
and treats.
The plaintiffs want the court to rule on:
(a) whether Natura should be enjoined;
(b) whether Natura advertised, marketed and sold pet food
that the consumer would not have purchased had the
consumer been aware of the true contents, additives,
chemicals and other contents of the pet food;
(c) whether Natura manufactured, marketed, advertised,
distributed and sold pet food that marketed promised
benefits, but which marketing claims are unsupported by
competent and reliable scientific research studies;
(d) whether Natura conducted marketing surveys or other
studies to determine how best to "humanize" pet food to
induce consumers to buy it;
(e) whether the "human-grade" and other marketing claims
marketing is deceptive and unfair;
(f) whether Natura deceptively, unfairly, knowingly,
intentionally and negligently manufactures, produces,
advertises, markets, distributes and sells pet foods
that contain toxic, dangerous, and other ingredients,
additives or chemicals;
(g) whether Natura knew or should have known that valid
research studies should be performed prior to marketing
the pet food and treats and the claimed benefits to
induce the plaintiffs and the class to purchase the
defendant's pet food and treats;
(h) whether Natura marketed, represented or held itself out
as an expert in dog and cat nutrition and the
otherwise beneficial effects of pet food and treats;
(i) whether Natura knew or should have known that the
ingredients and additives and other substances in
pet food and treats do not have the nutritional
and other beneficial qualities claimed in its
marketing;
(j) whether Natura intended for consumers to rely on its
marketing representations;
(k) whether Natura was unjustly enriched by selling
consumers pet food that was adulterated, did not
comport with its own marketing, contained toxic
substances, and was otherwise not as advertised;
(l) whether Natura's marketing and advertising was false
and deceptive under Florida and applicable state laws;
(m) whether Natura negligently manufactured, distributed,
marketed and sold pet food and treats to the plaintiff
and the class; and
(n) whether Natura negligently made false representations
and omissions regarding its pet food to the
plaintiff and the class that were not supported by
competent and reliable scientific data and research.
The plaintiffs ask the court for:
-- the disgorgement and restitution of Natura's wrongful
profits, revenue and benefits to the extent and in the
amount, deemed appropriate by the court; and
-- such other relief as the court deems just and proper to
remedy Natura's unjust enrichment.
The suit is "Arna Cortazzo, et al. v. Natura Pet Products, Inc.,
Case 1:08-cv-22443-DLG," filed in the U.S. District Court for
the Southern District of Florida.
Representing the plaintiffs is:
Catherine J. Macivor, Esq.
Maltzman Foreman PA
One Biscayne Tower
2 South Biscayne Boulveard - Suite 2300
Miami, FL 33131
Phone: 305-358-6555
Fax: 305-374-9077
PAN PHARMACEUTICALS: Faces AUD200-Million Lawsuit Over Losses
-------------------------------------------------------------
Pan Pharmaceuticals in Australia failed in 2003 after regulatory
intervention by the Therapeutic Goods Administration.
However, Pan founder Jim Selim in mid-2008 has won an out-of
court settlement worth AUD55 million to his case alleging
misconduct by the TGA, and this has encouraged investors,
customers and creditors to launch a separate class action suit
worth around AUD200 million against the authority.
The move is backed by litigation funder IMF (Australia) and will
be pursued by Selim's legal representative, law firm McLachlan
Thorpe Partners. Like the Selim suit, the new one will claim
"misfeasance of public office" occurred.
About Pan Pharmaceuticals
On May 22, 2003, Anthony Gregory McGrath & Christopher John
Honey of McGrathNicol+Partners were appointed as administrators
for Pan Pharmaceuticals Limited and its subsidiaries:
1. Pan Pharmaceuticals Services Pty Limited;
2. Pan Pharmaceuticals Exports Pty Limited;
3. Pan Laboratories (Australia) Pty Limited; and
4. Pan Pharmaceuticals Technologies Pty Limited
On Sept. 23, 2003, the creditors of Pan rejected a proposal for
a Deed of Company Arrangement submitted by Fred Bart and Jim
Selim. Subsequently on the same day, the creditors of Pan and
Laboratories resolved that these two companies be wound-up.
On Oct. 21, 2003, the creditors of Services, Exports, and
Technologies resolved to place these three companies into
liquidation.
Sale of business
Since their appointment, the Administrators and the Liquidators
have overseen a major upgrade of Pan's facilities, processes,
and documentation. On Oct. 1, 2003, the Therapeutic Goods
Administration advised that it was satisfied that Pan was
compliant with the Australian Code of GMP for Medicinal Products
with respect to the manufacture of soft gelatine capsules that
are required to be listed in the Australian Register of
Therapeutic Goods, and that reinstatement of the company's soft-
gel license could be recommended. The TGA issued the soft-gel
license on Nov. 4, 2003.
After the reinstatement of the soft-gel license, the Liquidators
recommenced the sale process for the Pan business. The
Liquidators offered the assets as a going concern and accepted
an offer of AU$20 million. Settlement occurred on Dec. 15,
2003.
The business and assets of Pan have been sold to Sphere
Healthcare Pty Ltd.
No Dividend Distribution
On Nov. 12, 2003, the Liquidators executed a declaration for the
purposes of Section 104-145 of the Income Tax Assessment Act
that there is no likelihood that shareholders will receive a
dividend from the winding up.
PASSAIC COUNTY: ACLU Sues Over Bad Conditions at County Jail
------------------------------------------------------------
The American Civil Liberties Union has filed a class action
lawsuit against the Passaic County Jail for allegedly forcing
its prisoners to live in inhumane and dangerous conditions, The
Associated Press says.
According to the AP, the lawsuit, which was filed by the ACLU on
behalf of eight prisoners, describes conditions at the jail as
"an affront to human decency." The suit names as defendants the
jail's warden, Charles Meyers, Passaic County Sheriff Jerry
Speziale, state Department of Corrections Commissioner George
Hayman and the Passaic County Board of Chosen Freeholders.
The suit claims that the conditions at the jail violate the
prisoners' constitutional rights, the report relates. Prisoners
say they have to coexist with rats and other vermin, endure
overcrowding and are subjected to beatings when they complain.
Air conditioning and ventilation also are faulty or non-
existent, leading to oppressive heat and cold, the suit claims.
The suit, the AP notes, seeks to force the county to fix the
facility and reduce the number of prisoners confined there. It
also suggests that a three-judge panel be established to
determine whether the jail should close if it cannot guarantee
reasonable conditions for prisoners.
Seton Hall Law School's Center for Social Justice and Princeton-
based law firm Dechert LLP represent the prisoners.
The AP points out that the jail is designed to hold about 900
prisoners, but has occasionally housed more than 2,000. The
more than 50-year-old building was one of the nation's largest
holders of immigration detainees after the Sept. 11 terrorist
attacks . That surge was followed by hunger strikes and other
protests charging mistreatment and overcrowding.
In 2006, the jail stopped housing immigrants facing deportation
after a controversy over treatment of foreign detainees there,
the report recounts.
Last fall in federal court, Mr. Meyers testified that the
facility housed approximately 1,900 prisoners. In reducing one
prisoner's sentence at the time, U.S. District Judge Katherine
Hayden called conditions at the jail "shameful."
Bill Maer, a spokesman for Passaic County Sheriff's Office,
which oversees the operation of the jail, told the AP that the
county has reduced the number of inmates at the jail to about
1,500, and has made other improvements such as improving the
heating and air conditioning system and switching food vendors.
"This lawsuit is a rehash of accusations that the department has
seen before," Mr. Maer said. "They're generally based on the
opinions of individuals who are incarcerated, and nobody likes
to be in jail."
TELIK INC: Settles Securities Fraud Suit in N.Y. for $5 Million
---------------------------------------------------------------
Telik Inc. has agreed to pay $5 million to settle a securities
class action accusing the biopharmaceutical company of hyping
its failed cancer treatment Telcyta and inflating the company
stock, The Standford Law School Securities Class Action
ClearingHouse reports.
Recently, the plaintiffs in the consolidated class action, led
by Policemen's Annuity and Benefit Fund for the City of Chicago,
notified Judge Colleen McMahon of the U.S. District Court for
the Southern District of New York of the impending request for
final approval of the settlement.
According to the report, the $5 million cash settlement provided
for class members -- investors who purchased Telik stock between
Feb. 19, 2004, and June 4, 2007 -- represents approximately one-
quarter of the damages the plaintiffs could have proved if the
action went to trial, the plaintiffs’ memorandum says.
While the plaintiffs' damages expert estimated the losses of
Telik's market value to be $449 million, he said much of the
loss was attributable to market forces rather than fraud by
Telik, which touted the cancer drug to the U.S. Food and Drug
Administration, financial analysts and shareholders, suggesting
that it would likely meet with regulatory approval when in fact
internal tests suggested it remained highly risky.
While the plaintiffs aimed for damages of $20.5 million, the
proposed $5 million cash settlement is "well above average for
securities class action settlements and, in light of all the
circumstances, is an outstanding result," the memorandum said.
The 54,000 class members overwhelmingly supported the
settlement, with only two class members objecting to the
settlement and three others excluding themselves, according to
the memorandum. The plaintiffs will move for final approval of
the settlement Friday; the plaintiffs' counsel has requested an
attorneys' fees award amounting to 25 percent of the $5 million
settlement, plus an additional $100,000 for expenses, according
to court documents.
Case Background
Starting on June 6, 2007, a series of putative securities class
action lawsuits were commenced against Telik and certain of its
current officers, one of whom is also a director (Class Action
Reporter, March 18, 2008).
The suits were filed either before the U.S. District Court for
the Southern District of New York or before the U.S. District
Court for the Northern District of California. The complaints
filed in New York also named as defendants the underwriters for
the company's November 2003 and January 2005 stock offerings.
All of the complaints allege violations of the U.S. Securities
Act of 1933 and the U.S. Securities Exchange Act of 1934 arising
out of the issuance of allegedly false and misleading statements
about the company's business and prospects, including the
efficacy, safety and likelihood of success of the company's drug
TELCYTA.
The plaintiffs seek unspecified damages and injunctive relief on
behalf of purchasers of the company common stock during the
period between March 27, 2003, and June 4, 2007, including
purchasers in the January 2005 stock offering.
The plaintiffs in the California cases subsequently voluntarily
dismissed their complaints without prejudice.
In January 2008, the parties to the New York securities class
action suit reached an agreement in principle to settle the
claims (Class Action Reporter, July 4, 2008).
Any objection or request for exclusion to and from the
settlement must be made by Aug. 8, 2008. Deadline for the
submission of proofs of claim is on Sept. 6, 2008.
U.S. EPA: Sends Notices to Workers in Connection with Bias Suit
---------------------------------------------------------------
Pursuant to an order by an administrative judge, the U.S.
Environmental Protection Agency issued notices on August 29,
2008, to current and former EPA employees identified as members
of a class action lawsuit over the alleged age and race
discrimination at the agency, Lawyers and Settlements reports.
The suit is "Carol A. Clopton et al. v. Stephen L. Johnson,
Administrator, United States Environmental Protection Agency,
EEOC Case No. 280-A0-04324X."
The report explains that in federal employee cases before the
Equal Employment Opportunity Commission, it is the federal
agencies, rather than the class representatives, who are
required to issue the notice to class members.
Lawyers and Settlements relates that this EPA's notice has been
long delayed as the Appellate Office of the EEOC had first
ordered the notice to be issued in October 2006. The notice was
again ordered to be issued on February 11, 2008, by the
administrative judge who finalized the certification of the
class in accordance with the EEOC's last appellate order from
January 2007.
The original complaint, the report recounts, was filed by class
agents Emajo Mayberry and Carol Clopton on July 20, 2000.
However, on June 1, 2002, the administrative judge dismissed the
class complaint. Upon appeal, however, the Office of Federal
Operations, EEOC, instructed the administrative judge to
conditionally certify the class on September 14, 2004.
Following a second round of appeals by EPA, the EEOC issued a
decision certifying the class on October 12, 2006. A subsequent
request for reconsideration by EPA was denied on January 9,
2007, the report further recalls.
According to Lawyers and Settlements, the final class
certification consists of all Region VII employees, including
retired employees, who were employed between May 11, 1998, and
August 31, 2007, and who were at least 40 years of age when
employed, including a subset of the class of Region VII black
employees who were at least 40 years of age when employed.
The complainants allege that the EPA denied rotational
assignments, training opportunities and promotions to older
career employees because of their age and race, while the agency
gave preferential treatment and opportunities to younger newly
hired employees. This discriminatory treatment additionally
included providing the younger employees with accelerated salary
increases, increased amounts of paid leave, and special travel
opportunities.
Class Agents Clopton and Mayberry filed the original complaint
when EPA's R7 management initiated and practiced blatant and
targeted age and racial discrimination against its older
employees through its "New Hires" program, thereby creating such
hostile work situations that many older and dedicated employees
felt it necessary to take unplanned retirement to escape the
accelerated unhealthy stressful environment.
Ms. Clopton and Ms. Mayberry, who had long been career employees
at EPA, believe this suit is about holding government officials
accountable. They say they are committed to assuring equality
and fairness for all employees and believe the U.S. EPA should
be held accountable by compensating those employees who have
been harmed by EPA's unwritten and illegal policies of age and
race discrimination.
WOODBURY: Court Says No to Thousands Joining Strip-Search Suit
--------------------------------------------------------------
A U.S. District Court judge denied a South Sioux City, Neb.,
woman's motion to add thousands of people to her lawsuit against
Woodbury County concerning the county jail's former strip-search
policy, The Associated Press reports.
According to AP, Maureen Rattray's case is scheduled to go to
trial on Oct. 12, 2009. She is challenging the county's former
policy that allowed jailers to strip search offenders booked
into jail for serious misdemeanors and felonies.
The report relates that a federal judge denied Ms. Rattray's
motion to make the case a class-action lawsuit earlier last week
week and include thousands of people who were booked in the jail
since 1985.
AP notes that Ms. Rattray's suit stems from her drunken driving
arrest in August 2006 wherein she claims jailers kept a door
open during a strip search and she was forced to hold a jail
jumpsuit in front of her naked body while she walked past men to
her cell.
New Securities Fraud Cases
GENERAL ELECTRIC: Scott+Scott Files Conn. Securities Fraud Suit
---------------------------------------------------------------
On September 5, 2008, Scott+Scott LLP filed a class action
complaint against General Electric Company and certain officers
and directors in the U.S. District Court for the District of
Connecticut.
The action is brought on behalf of those purchasing GE common
stock during the period beginning March 12, 2008, and through
April 10, 2008, inclusive, for violations of the Securities
Exchange Act of 1934.
The complaint alleges that during the Class Period GE made
materially false and misleading statements regarding, among
other things, the Company's 1Q08 earnings guidance, including
earnings per share, the performance of GE's financial services
division, the Company's sale of key real estate assets and the
ability of the Company's Consumer and Industrial division and
Healthcare division to sell certain products. The complaint
alleges that defendants provided a 1Q08 EPS guidance of $.50-
.53, and FY08 guidance of $2.42 "or greater." This would
represent EPS growth of 10% at a minimum.
Despite repeated reassurance by GE directly to its investors,
however, the complaint alleges that the Company shocked the
market and its investors when it released its 1Q08 results on
April 11, 2008. Instead of reporting a 1Q08 EPS of $0.50-0.53
and improving on 1Q07 results, as the Company had assured its
investors that it would just weeks before, GE reported a
significantly lower 1Q08 EPS of $0.43, down 2% from the 1Q07.
As the market reacted to these disclosures, GE's stock declined
$4.70 per share from $36.75 to close at $32.05 per share on
volume of over 366 million shares, representing a 13% drop that
wiped out approximately $47 billion in market value, at least
one analyst is quoted as stating, "The miss and cut to guidance
raises credibility concerns for GE."
Indeed, the complaint alleges, it became clear at the end of the
Class Period, among other things, that defendants had failed to
disclose that GE's financial services division was
underperforming prior representations, with the division's
investments materially declining in value such that the Company
would be required to record mark-to-market losses and recognize
certain asset impairments, and that GE's Consumer and Industrial
and Healthcare Divisions were experiencing an inability to sell
certain products.
Moreover, as alleged in the complaint, the Company had been
depending on selling real estate assets of approximately
$900 million that it had been unable to sell.
Interested parties may move the court no later than Sept. 29,
2008, for lead plaintiff appointment.
For more information, contact:
Scott+Scott
108 Norwich Avenue
P.O. Box 192
Colchester, CT 06415
Phone: 800-404-7770
860-537-5537
e-mail: scottlaw@scott-scott.com
Web site: http://www.scott-scott.com/
NATIONAL CITY: Brualdi Law Files Florida Securities Fraud Suit
--------------------------------------------------------------
The Brualdi Law Firm, P.C., commenced a class action lawsuit in
the Fifteenth Judicial Circuit Court in West Palm Beach,
Florida, on behalf of shareholders who obtained National City
Corporation common shares in connection with the Company's
acquisition of Fidelity Bankshares, Inc., on January 5, 2007.
The lawsuit seeks damages on behalf of all current and former
National City shareholders who acquired the Company's common
stock pursuant to and traceable to the Company's Registration
Statement filed with the Securities and Exchange Commission in
connection with the Fidelity Acquisition.
According to the Complaint, the Registration Statement filed in
connection with the Fidelity Acquisition contained materially
misleading statements and omissions relating to:
(a) the Company's disclosures of billions of dollars of
risky construction loans;
(b) the Company's classification of loans in its portfolio
as nonperforming;
(c) the understatement of the Company's loan loss reserves
and
(d) the misstatement of the Company's financial results.
For more information, contact:
Sue Lee, Esq. (slee@brualdilawfirm.com)
The Brualdi Law Firm, P.C.
29 Broadway, Suite 2400
New York, NY 10006
Phone: 877-495-1187 (toll free)
212-952-0602
Web site: http://www.brualdilawfirm.com/
QUEST ENERGY: KGS Files Securities Fraud Lawsuit in Oklahoma
------------------------------------------------------------
Kahn Gauthier Swick, LLC, filed a securities class action
lawsuit in the United States District Court for the Western
District of Oklahoma, on behalf of purchasers of Quest Energy
Partners LP units who bought between the date of the Company's
initial public offering on or about Nov. 7, 2007, and Aug. 25,
2008.
Quest Energy and certain of its officers and a controlling
entity are charged with including, or allowing the inclusion of,
materially false and misleading statements in the Registration
Statement and Prospectus issued in connection with the Company's
IPO, in violation of the Securities Act of 1933. In particular,
despite raising $150 million in its IPO, Quest Energy failed to
properly disclose related party transactions between its former
CEO and an entity he controlled. On Aug. 25, 2008, Quest Energy
announced the resignation of CEO Jerry Cash after the Oklahoma
Department of Securities' inquiry concerning, among other
issues, questionable transfers of Quest Energy funds to an
entity Mr. Cash controlled. The Company announced the creation
of a special committee to conduct an internal investigation.
After these announcements, the price of Quest Energy shares has
fallen dramatically.
For more information, contact:
Lewis Kahn, Esq. (Lewis.kahn@kgscounsel.com)
Kahn Gauthier Swick, LLC
Poydras Center
650 Poydras Street, Suite 2150
New Orleans, LA 70130
Phone: 1-866-467-1400, ext. 100
QUEST ENERGY: Rosen Law Firm Files Okla. Securities Fraud Suit
--------------------------------------------------------------
The Rosen Law Firm filed a class action lawsuit in the United
States District Court for the Western District of Oklahoma on
behalf of all purchasers of Quest Energy Partners LP common
units from the date of the Company's initial public offering on
or about November 7, 2007.
The complaint charges Quest Energy and certain former and
present officers, and controlling entities, including Quest
Resource Corporation, with violations of Sections 11 and 15 of
the Securities Act of 1933 by virtue of Quest Energy's issuance
of a materially inaccurate Registration Statement and Prospectus
in connection with Quest Energy's IPO.
According to the Complaint, on November 7, 2007, Quest Energy
commenced its IPO raising over $150 million from investors. The
Complaint asserts that Quest Energy's Registration Statement was
materially inaccurate because Quest Energy failed to properly
disclose related party transactions between its former CEO and
an entity controlled by him. The Complaint also asserts claims
against Quest Resource as it was the controlling entity of Quest
Energy and is liable under Section 15 of the Securities Act.
On August 25, 2008, Quest Energy announced that its former CEO
Jerry Cash had resigned following an inquiry by the Oklahoma
Department of Securities in connection with questionable
transfers of, among other things, Quest Energy funds to an
entity controlled by Mr. Cash. Quest Energy also announced that
it had constituted a special committee to conduct an internal
investigation. As a result of these adverse disclosures, the
price of Quest Energy shares dropped damaging investors.
For more information, contact:
Laurence Rosen, Esq.
Phillip Kim, Esq.
The Rosen Law Firm P.A.
236 Tillou Rd., Essex County
South Orange, NJ 07079
Phone: 212-686-1060
Weekends Phone: 917-797-4425
Toll Free: 1-866--767-3653
Fax: 212-202-3827
Web site: http://www.rosenlegal.com/
SEMGROUP ENERGY: Murray Frank Files Securities Lawsuit in N.Y.
--------------------------------------------------------------
Murray, Frank & Sailer LLP has filed a class action suit in the
Southern District of New York on behalf of shareholders who
purchased or otherwise acquired the common units of SemGroup
Energy Partners, L.P., during the period between July 17, 2007,
and July 17, 2008, inclusive, and on behalf of purchasers of
SGLP's common units acquired pursuant and traceable to the
Registration Statement and Prospectus issued in connection with
SGLP's Initial Public Offering declared effective on July 17,
2007, as well as all purchasers of SGLP's common units acquired
pursuant and traceable to the Registration Statement and
Prospectus issued in connection with SGLP's secondary offering
completed on or about February 20, 2008.
According to the complaint, the Registration Statements and
Prospectuses issued in connection with the IPO and Secondary
Offering and the statements made during the Class Period failed
to disclose the adverse financial condition and lack of
liquidity of SemGroup L.P. (SGLP's Parent, from whom SGLP
derives more than 80% of its revenue) as a result of its
speculative, dangerous and unauthorized hedging and trading in
crude oil.
The complaint further alleges that by July 11, 2008, SGLP's
common unit value began to decline on increased trading volume
despite the release of no adverse news. By July 17, 2008,
SGLP's common unit price declined 50% to $11.00 on high trading
volume in excess of 5.7 million units after material adverse
news, which had been withheld by defendants, began to leak, thus
forcing defendants to issue a statement revealing that SemGroup
L.P. was experiencing liquidity issues and was exploring various
alternatives, including raising additional equity, debt capital
or the filing of a voluntary petition for reorganization under
Chapter 11 of the Bankruptcy Code. The complaint indicates that
as a result, the price of the Company's common units continued
to decline, wiping out almost $300 million in their value.
For more information, contact:
Murray, Frank & Sailer LLP
275 Madison Ave., Suite 801
New York, NY 10016-1101
Phone: 212-682-1818
800-497-8076
e-mail: newcase@murrayfrank.com
Web site: http://www.murrayfrank.com/
*********
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the Class Action Reporter. Submissions
via e-mail to carconf@beard.com are encouraged.
Each Friday's edition of the CAR includes a section featuring
news on asbestos-related litigation and profiles of target
asbestos defendants that, according to independent research,
collectively face billions of dollars in asbestos-related
liabilities.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
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USA. Glenn Ruel S. Senorin, Janice M. Mendoza, Freya Natasha F.
Dy, and Peter A. Chapman, Editors.
Copyright 2008. All rights reserved. ISSN 1525-2272.
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