/raid1/www/Hosts/bankrupt/CAR

/raid1/www/Hosts/bankrupt/CAR_Public/101021.mbx C L A S S A C T I O N R E P O R T E R Thursday, October 21, 2010, Vol. 12, No. 208 Headlines AMERICAN APPAREL: Faces Securities Fraud Class Action Lawsuit ABBOTT LABORATORIES: Faces Class Action Suit Over Similac APOLLO GROUP: Oregon to Seek Lead Plaintiff Status in Class Suit BANK OF AMERICA: Faces Class Suits Over Mortgage Modifications BANK OF SMITHTOWN: Settles Suit Over People's United Merger BEST BUY: Accused in Calif. Suit of Not Paying Overtime CAPITAL GOLD: Faces Suits Over Planned Sale to Gammon Gold CHARLES SCHWAB: Class Outside CA Not Precluded to Further Claims CHINA GREEN: Faces Federal Securities Class Action Lawsuit CSX CORP: Consolidated Antitrust Suit Still Pending in Columbia EMMIS COMMS: Expects Dismissal of Suits After Tender Offer Failed GENEREX BIOTECH: Defends Suit Over Misleading CraveNX Adverts HERLEY INDUSTRIES: Final Approval of Settlement Pact Pending LEAP WIRELESS: Accord on Suit Over Fin'l Restatement Gets Final OK MISTRAS GROUP: Unable to Reach Settlement in Mediation NTI GLOBAL: Sued in Mo. for Falsely Representing Agility Tunnels QANTAS AIRWAYS: Court Sets Nov. 15 Fuel Surcharge Claims Bar Date SALT LAKE: District Attorney Sued Over Inflated Discovery Fees SANOFI-AVENTI US: Sued for Non-Payment of Overtime Wages SOURCE FOR PUBLIC DATA: Settlement in Drivers' Class Suit Okayed SPRINGFIELD, MO: Suit Over Red-Light Ticket System Dismissed TICKETMASTER.COM: Partial Fee Refunds in Class Suit Likely UNITED STATES: Faces Potential Class Suit Over Moose Collisions WAL-MART STORES: Accused in N.J. of Hiring Undocumented Migrants WASHINGTON MUTUAL: Class in Securities Suit Wins Certification ********* AMERICAN APPAREL: Faces Securities Fraud Class Action Lawsuit ------------------------------------------------------------- A class action lawsuit was filed on August 25, 2010, in the United States District Court for the Central District of California on behalf of all persons who purchased American Apparel, Inc. securities during the period from December 20, 2006, to August 17, 2010, inclusive. American Apparel is a manufacturer and clothing retailer that has marketed itself as "Sweatshop Free," using a single factory in Los Angeles. The complaint charges American Apparel and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that during the Class Period, defendants made false and misleading statements about the Company's hiring practices and the effect of such practices on the Company's financial performance. On September 3, 2009, the company announced that it was forced to dismiss 1,600 employees who were unable to prove their immigration status or fix problems with their employment records. Those terminations came two months after the company announced that the U.S. Immigration and Customs Enforcement agency charged that 1,600, or one-third, of American Apparel's workers were illegal immigrants. At the time, American Apparel executives said they didn't anticipate any significant loss in productivity. Then, on August 17, 2010, the Company issued a press release announcing that it expected to report a loss of $5 million to $7 million in the second quarter of 2010 on net sales of $132 million to $143 million. A significant factor in such losses, according to the Company, was "lower labor efficiency at the Company's production facilities." The lower labor efficiency was primarily a result of the hiring of over 1,600 net new manufacturing workers during the second quarter of 2010." American Apparel's stock dropped approximately 41% on this news. If you purchased any class of shares of American Apparel from December 20, 2006, to August 17, 2010, you may move the court no later than October 25, 2010, and request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. To be appointed lead plaintiff, the Court must decide that you have the largest financial interest of any competing movant and that your claims are typical of the claims of other class members, and that you will adequately represent the class. Your share in any recovery will not be enhanced or diminished by the decision whether or not to serve as a lead plaintiff. If there is a recovery in this action and you are part of the class, you can recover as an absent class member without moving for lead plaintiff or otherwise taking an active role in the litigation. You may retain Milberg LLP, or other attorneys, to serve as your counsel in this action, but do not need to retain counsel to participate in any recovery as an absent class member The complaint has been filed as a class action on behalf of all persons who own American Apparel securities. No class has yet been certified, and there can be no guarantee that a class will be certified. The complaint in this action was not filed by Milberg. About Milberg Milberg LLP -- http://www.milberg.com/-- is a class action and litigation firm, representing individual and institutional investors, pension funds, hedge funds, unions, and consumers. Founded in 1965, Milberg has offices in New York, Los Angeles, Tampa, and Detroit. To contact Milberg: Andrei V. Rado, Esq. MILBERG LLP One Pennsylvania Plaza, 49th Fl. New York, NY 10119-0165 Telephone: (800) 320-5081 Email: contactus@milberg.com ABBOTT LABORATORIES: Faces Class Action Suit Over Similac --------------------------------------------------------- A class action lawsuit alleging deceptive business practices has been filed against Abbott Laboratories over claims that the pharmaceutical giant sold millions of tubs of infant powder formula that was contaminated with beetles and beetle larvae. The lawsuit, which was brought in federal court in Chicago, was filed on behalf of Maria C. Kiely, a mother of a newborn baby boy. The suit alleges that Abbott knew that its baby formula was tainted for at least six days prior to announcing it to the public. As a result, the suit claims that the named plaintiff's son, like thousands of babies throughout the country, suffered gastrointestinal health issues as a result of ingesting the tainted formula. The lawsuit is brought by Jay Edelson and Rafey S. Balabanian of Edelson McGuire, LLC. According to managing partner, Jay Edelson, this case seems especially problematic for Abbott. "What we have found is that certain companies handle product recalls in an upfront and transparent way. We believe that we can prove that Abbott did the opposite and sat on information while babies got sick." Edelson McGuire has had numerous high-profile product recall lawsuits, including a $30 million settlement involving the Thomas the Tank lead paint recalls. About Edelson McGuire Edelson McGuire, LLC is a plaintiff's class action law firm with attorneys in Illinois, New York, California, and Florida APOLLO GROUP: Oregon to Seek Lead Plaintiff Status in Class Suit ---------------------------------------------------------------- Melissa Korn, writing for Dow Jones Newswires, reports the state of Oregon has joined a securities fraud class-action lawsuit against Apollo Group Inc. and several of its executives, alleging the for-profit college operator misled investors about its revenue between 2007 and 2010. The Oregon Public Employees Retirement Fund lost $10 million as Apollo's stock price dropped in the wake of the company's disclosure of a Securities and Exchange Commission inquiry and heightened scrutiny of the entire for-profit college sector, according to a statement released by Oregon Attorney General John Kroger and Treasurer Ted Wheeler. The retirement fund had total assets of $51 billion at Aug. 31. "Companies that cook their books will have to answer to Oregon in court," Mr. Kroger said. A representative from Apollo wasn't immediately available for comment. The lawsuit, filed in U.S. District Court in Arizona, alleges that Apollo failed to account for losses that stemmed from student withdrawals. The company disclosed in October 2009 that it was the subject of an SEC probe regarding its revenue-recognition practices. Messrs. Kroger and Wheeler said Apollo's stock tumbled on that news, and again this past August when a Government Accountability Office report found representatives at a number of for-profit colleges provided misleading and even fraudulent information to undercover agents posing as prospective students. Oregon is seeking lead plaintiff status in the class-action suit. BANK OF AMERICA: Faces Class Suits Over Mortgage Modifications -------------------------------------------------------------- Olga Pierce, writing for ProPublica, reports a crop of federal lawsuits are moving forward alleging Bank of America was unfair to homeowners who sought assistance through the government's main loan modification program. In a little-noticed decision earlier this month, a federal judicial panel rolled together several class action lawsuits from U.S. district courts across the country and assigned them to a federal judge in Massachusetts, who will decide whether to dismiss the suits, or allow them to proceed. The decisions she makes could affect more than 100,000 homeowners, and further highlights questions about the performance of the government's Making Home Affordable program, also called HAMP. Under the program, banks and other companies that service mortgages are paid by the government for each loan they modify. Homeowners are generally placed in trial periods meant to last three months -- but which often drag on much longer. During the trial period, homeowners pay the reduced amount they would be paying with a permanent modification. The trial is a chance for homeowners, many of whom are suffering serious financial hardship, to show they can afford to keep their homes under modified terms. Plaintiffs in the class were in trial mortgage modifications for Bank of America, and then subsequently denied permanent modifications by BofA. The homeowners argue that the trial agreement was a binding contract stating that if they fulfilled their obligations during the trial they were guaranteed a permanent modification. The plaintiffs "thought they had saved their homes by qualifying for temporary loan modifications, then the rug was pulled out from under them," said Stuart Rossman, director of litigation at the National Consumer Law Center, who is representing a group of Massachusetts homeowners. "Homeowners fulfilled their part of the deal, but the bank didn't do their part." If the homeowners' lawsuits are successful, Mr. Rossman said, they are asking only that they be granted the permanent modifications they sought in the first place. In motions to dismiss filed in several of the cases, however, Bank of America argues that a homeowner's "Trial Period Plan" is not a binding agreement "because it fails to specify the key terms of the permanent modification." Therefore, BofA's motion continues, it is "nothing more than an agreement to agree at some future date." More broadly, the bank argues that individuals are not allowed to sue under Making Home Affordable. Bank of America spokeswoman Shirley Norton told us that BofA supported the consolidation of cases -- since it streamlines the litigation -- and said the bank "intends to continue to defend against them aggressively." If the cases are not dismissed, it could impact a significant number of homeowners since Bank of America and its subsidiaries have kicked about 160,000 homeowners out of trial modifications so far. Similar litigation is under way against other large mortgage servicers. They could also serve as a bellwether for many cases in state courts that are not included in this federal class action. But simply having been through a canceled trial modification is not enough to qualify for the class action. The same panel of judges chose not to include several individual suits against Bank of America because they involved details particular to each case. One man, for example, had his trial canceled because he had sent in payments that were $70 too low, a detail that is not shared by other plaintiffs. BANK OF SMITHTOWN: Settles Suit Over People's United Merger ----------------------------------------------------------- Jessica DiNapoli, writing for Long Island Business News, reports Bank of Smithtown has reached a settlement with the people involved in a class action lawsuit trying to stop the merger of the 100-year-old financial institution with Bridgeport, Conn.- based People's United Financial, according to documents filed with the Securities and Exchange Commission. The agreement, summarized in a "memorandum of understanding" between Bank of Smithtown and the five people whose lawsuits were consolidated into a class action suit, required that the Hauppauge-based bank add more information to proxy statements filed with the Securities and Exchange Commission, according to Robert Harwood, an attorney representing shareholder Kevin Brand in the suit. Bank of Smithtown shareholders use the information in the proxy statement to vote on the merger. "More information is desirable when figuring out whether or not to surrender your future interest in a company," Mr. Harwood said. The defendants in the class action lawsuit, which include CEO Brad Rock and many other board members, agreed to disclose the extra information because of the cost of litigation, the proxy document states. The vote is scheduled for Nov. 19 at the Sheraton Long Island Hotel in Hauppauge. Bank of Smithtown is urging its shareholders to approve the merger, which was announced July 15. The five lawsuits filed against the Bank of Smithtown CEO and numerous board members -- which all try to stop the $60 million merger deal -- were consolidated into one class action suit Oct. 6, according to a copy of the lawsuit. Oct. 12 marked the date that the settlement was reached, according to the proxy statement. The lawsuits allege that the $60 million price was too little for the 30-branch bank. Mr. Harwood said the Bank of Smithtown agreed to include information on projections for future profits and losses for Bank of Smithtown and information on how the company will perform in the future. Although there is no monetary compensation involved in the settlement, Mr. Harwood said he and his client think it's a good result. John Romano, president of the Bank of Smithtown, did not return calls seeking comment. BEST BUY: Accused in Calif. Suit of Not Paying Overtime ------------------------------------------------------- Courthouse News Service reports Best Buy stiffed workers for overtime, a class action claims in Sacramento Superior Court. A copy of the Complaint in Wilson v. Best Buy Company, et al., Case No. 34-2010-00089299 (Calif. Super. Ct., Sacramento Cty.), is available at: http://www.courthousenews.com/2010/10/18/BestBuy.pdf The Plaintiff is represented by: R. Rex Parris, Esq. Aleaxander R. Wheeler, Esq. Jason P. Fowler, Esq. Douglas Han, Esq. Kitty Szeto, Esq. R. REX PARRIS LAW FIRM 42220 10 St. West, Suite 109 Lancaster, CA 93534 Telephone: (661) 949-2595 CAPITAL GOLD: Faces Suits Over Planned Sale to Gammon Gold ---------------------------------------------------------- Capital Gold Corporation faces suits in connection with its sale to Gammon Gold Inc., according to the company's Oct. 14, 2010, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended July 31, 2010. On Oct. 1, 2010, the company and Gammon Gold entered into a definitive merger agreement pursuant to which, if consummated, Gammon Gold will acquire all of the issued and outstanding common shares of Capital Gold in a cash and share transaction. The total consideration for the purchase of 100% of the fully diluted shares of Capital Gold is approximately S$288 million or $4.57 per Capital Gold share based on Gammon Gold's closing price on Sept. 24, 2010 on the New York Stock Exchange. On Oct. 4, 2010, Walter Earl Jenkins and Jonathan Schroeder, each represented by the same law firm, filed identical lawsuits against Capital Gold, its directors and Gammon Gold in New York Supreme Court claiming, among other things, that the directors of Capital Gold breached their fiduciary duties to Capital Gold in connection with the approval of the merger agreement between Capital Gold and Gammon Gold. The plaintiffs purport to represent a class of all stockholders of Capital Gold stock other than stockholders who are affiliates of Capital Gold. The plaintiffs have asked the Court to enjoin Capital Gold from consummating its merger with Gammon Gold. Capital Gold Corporation -- http://www.capitalgoldcorp.com/-- is a gold production and exploration company. Through its Mexican subsidiaries and affiliates, it owns 100% of the "El Chanate" gold mine located near the town of Caborca in Sonora, Mexico. It also owns and leases mineral concessions near the town of Saric, also in Sonora, that are undergoing preliminary exploration for gold and silver mineralization. CHARLES SCHWAB: Class Outside CA Not Precluded to Further Claims ---------------------------------------------------------------- The U.S. District Court for the Northern District of California issued an opinion holding that federal securities law class members resident outside of California would not be precluded under the preliminary settlement agreements from bringing a further claim under California law against The Charles Schwab Corporation, according to the company's Oct. 15, 2010, Form 8-K filing with the U.S. Securities and Exchange Commission. The company is the subject of consolidated class action litigation, regulatory investigations and individual investor arbitration claims relating to the Schwab YieldPlus Fund(R), an ultra-short bond fund. The Bond Fund was designed to invest in a variety of fixed income instruments, including corporate bonds, asset-backed securities, mortgage-backed securities and other fixed income investments. The credit crisis that began in mid- 2007 led to a decline in the value of a majority of fixed income investments market wide. As a result, certain Schwab clients who chose to invest in the Bond Fund experienced a decline in their investments, leading to the litigation. Nine class action lawsuits were filed between March and May 2008 on behalf of investors in the Bond Fund alleging violations of state law and federal securities law in connection with the fund's investment policy, disclosures and marketing. These cases were consolidated in a single action on July 3, 2008, in the U.S. District Court for the Northern District of California. Specific allegations include changes to the investment policy of the fund regarding limits on positions in mortgage-backed securities without obtaining a shareholder vote; inadequate disclosure of the risks associated with fund investments in mortgage-backed securities and fund risk management; inaccurate reporting of the fund's weighted-average duration; and failure to disclose redemptions of positions in YieldPlus by other Schwab investment funds. The lawsuit seeks unspecified compensatory and rescission damages, unspecified equitable and injunctive relief, and costs and attorneys' fees. Defendants named in the lawsuit include the company, Schwab, CSIM, the fund itself, Schwab Investments (registrant and issuer of the fund's shares), Charles R. Schwab, Randall W. Merk (current president of the fund), and current and former trustees and officers of the fund and/or Schwab. On Feb. 4, 2009, the court denied defendants' motion to dismiss plaintiffs' federal law claims and dismissed all but one state law claim. On Aug. 21, 2009, the court certified two classes of plaintiffs for purposes of the federal law claims and a single class of plaintiffs for purposes of the remaining state law claim. On March 30, 2010, the court granted plaintiffs' motion for summary judgment holding defendants liable for plaintiffs' state law claim regarding changes to the investment policy of the Bond Fund, which plaintiffs alleged were made without shareholder approval in violation of Section 13(a) of the Investment Company Act of 1940. On April 5, 2010, defendants filed a motion for interlocutory appeal of this ruling, which the court denied at a hearing on April 26, 2010. On April 8, 2010, the court issued an order denying defendants' motion for summary judgment on plaintiffs' federal law claims. On April 23, 2010, the company entered into a settlement agreement with plaintiffs in which the company, without admitting liability, agreed to a total of $200 million to resolve plaintiffs' federal law claims. On May 14, 2010, the company entered into a settlement agreement with plaintiffs in which the company, without admitting liability, agreed to resolve plaintiffs' state law claim for $35 million. The settlement agreements were preliminarily approved by the court on May 26, 2010, and remain subject to final court approval. On Oct. 14, 2010, the court issued an opinion holding that federal securities law class members resident outside of California would not be precluded under the preliminary settlement agreements from bringing a further claim under California law against the defendants. The company is reviewing the court's opinion in order to determine its implications for the tentative settlement. Charles Schwab Corporation -- http://www.schwab.com/-- provides financial services, with more than 300 offices and 7.9 million client brokerage accounts, 1.5 million corporate retirement plan participants, 803,000 banking accounts, and $1.36 trillion in client assets. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, http://www.sipc.org),and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through its Advisor Services division. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. CHINA GREEN: Faces Federal Securities Class Action Lawsuit ---------------------------------------------------------- The Rosen Law Firm Sunday disclosed that a class action lawsuit alleging violations of the federal securities laws has been filed in the US District Court for the District of Nevada on behalf of purchasers of China Green Agriculture, Inc. ("China Green" or the "Company") (NYSE: CGA) securities during the period from November 12, 2009 through September 1, 2010 (the "Class Period"). To join the class action against China Green, go to the Web site at http://rosenlegal.com/or call Laurence Rosen, Esq., or Phillip Kim, Esq., toll-free at 866-767-3653. You may also email lrosen@rosenlegal.com NO CLASS HAS YET BEEN CERTIFIED IN THE ABOVE ACTION. UNTIL A CLASS IS CERTIFIED, YOU ARE NOT REPRESENTED BY COUNSEL UNLESS YOU RETAIN ONE. YOU CHOOSE TO DO NOTHING AT THIS POINT AND REMAIN AN ABSENT CLASS MEMBER. The Complaint alleges violations of the federal securities laws against China Green and certain of its officers and directors based on alleged misleading statements about the Company's financial performance. The Complaint further alleges that China Green's financial statements filed with the SEC for fiscal 2010 are materially false and misleading because the Company's financial statements filed with Chinese authorities for the comparable periods are materially different. If you wish to serve as lead plaintiff, you must move the Court no later than December 14, 2010. A lead plaintiff is a representative party that acts on behalf of absent class members in directing and overseeing the litigation. If you wish to join the litigation, or to discuss your rights or interests regarding this class action, please contact Laurence Rosen, Esq. or Phillip Kim, Esq. of The Rosen Law Firm, toll-free, at 866-767-3653, or via e-mail at lrosen@rosenlegal.com You may also visit the firm's Web site at http://rosenlegal.com/ The Rosen Law Firm concentrates its practice on investor securities litigation, representing investors throughout the world. CSX CORP: Consolidated Antitrust Suit Still Pending in Columbia --------------------------------------------------------------- CSX Corp. and three other major U.S. railroads continue to face a consolidated class-action lawsuit in the U.S. District Court for the District of Columbia over allegations that the individual railroads violated the U.S. antitrust laws. Since 2007, at least 30 putative class action suits have been filed in various federal district courts against CSX Transportation, CSX Corp.'s principal operating company, and three other U.S.-based Class I railroads. The lawsuits contain substantially similar allegations to the effect that the defendants' fuel surcharge practices relating to contract and unregulated traffic resulted from an illegal conspiracy in violation of antitrust laws. The suits seek unquantified treble damages, three times the amount of actual damages, allegedly sustained by purported class members, attorneys' fees and other relief. All but three of the lawsuits purport to be filed on behalf of a class of shippers that allegedly purchased rail freight transportation services from the defendants through the use of contracts or through other means exempt from rate regulation during defined periods commencing as early as June 2003 and that were assessed fuel surcharges. Three of the lawsuits purport to be on behalf of indirect purchasers of rail services. The class action suits have been consolidated in federal court in the District of Columbia. The defendants filed a Motion to Dismiss and oral arguments were heard in October 2008. On Nov. 7, 2008, the Court denied the railroads' Motion to Dismiss the claims of shippers who directly purchased transportation services. On Dec. 31, 2009, the Court granted in part the railroads' Motion to Dismiss the claims of indirect purchasers who made purchases from railroad shippers rather than directly from the railroads. While the Court found that indirect purchasers' state law claims for money damages are preempted by federal law, it also found that they had stated a federal antitrust claim for injunctive relief. On Jan. 16, 2009, on motion by the indirect plaintiffs, the Court entered final judgment on the state law claims which allow the indirect plaintiffs to seek an immediate appeal. The Court also stayed proceedings relating to the claim for injunctive relief appeal. Now that the Motion to Dismiss has been decided, discovery will move forward. The railroads intend to ask the Court to first proceed with discovery relating to whether the case is appropriate to certify as a class action and only if a class is certified would merit discovery takes place. No further updates were reported in the company's Oct. 15, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Sept. 24, 2010. CSX Corporation, based in Jacksonville, Fla., is a leading transportation company providing rail, intermodal and rail-to- truck transload services. The company's transportation network spans approximately 21,000 miles with service to 23 eastern states and the District of Columbia, and connects to more than 70 ocean, river and lake ports. EMMIS COMMS: Expects Dismissal of Suits After Tender Offer Failed ----------------------------------------------------------------- Emmis Communications Corporation, in its Oct. 15, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Aug. 31, 2010, discloses that it expects class actions filed arising out of a proposed tender offer will be dismissed after the said tender offer was terminated. On April 26, 2010, JS Acquisition, Inc., a corporation then owned entirely by the company's Chairman, Chief Executive Officer and President, Mr. Jeffrey H. Smulyan, and Alden Global Capital entered into a non-binding Letter of Intent with respect to a series of transactions relating to the equity securities of Emmis. As a result of the proposed tender offer, a number of purported class actions were filed against various combinations of Emmis, JS Acquisition, Alden, and members of the board of directors. On June 4, 2010, a purported class action complaint was filed, styled Richard Frank v. Jeffrey H. Smulyan, Susan Bayh, Gary Kaseff, Richard Leventhal, Peter Lund, Greg Nathanson, Lawrence Sorrel, Patrick Walsh, Emmis Communications Corporation, JS Acquisition, Inc., JS Acquisition, LLC, and Alden Global Capital, Cause No. 49D10 1006 PL 025149. The Frank action was filed in the Marion Superior Court in Indiana. Since that time, Plaintiff Frank has filed motions seeking to have his case consolidated into the Ross matter and to have his counsel appointed as lead counsel for a Preferred Stock Class, the latter having been opposed by Plaintiffs Hinkle and Stabosz. The motions filed by Plaintiff Frank remain pending. On September 9, 2010, the transaction was effectively terminated. The company believes that the lawsuits related to the transaction will be dismissed in the near future. Headquartered in Indianapolis, Indiana, Emmis Communications Corporation -- http://www.emmis.com/-- owns and operates radio stations and magazine publications in the U.S. and in Europe. GENEREX BIOTECH: Defends Suit Over Misleading CraveNX Adverts ------------------------------------------------------------- Generex Biotechnology Corp. defends a class action complaint alleging misleading advertising of its CraveNX(TM) products, according to the company's Oct. 14, 2010, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended July 31, 2010. On May 11, 2010, plaintiff Colleen Solis filed a class action complaint against Generex and unidentified and unknown "Doe" defendants in Riverside County Superior Court (Riverside, California). Plaintiff is seeking to enjoin Generex from alleged misleading advertising about CraveNX(TM) and to obtain a refund of the purchase price she paid and restitution for the purported class. Plaintiff also seeks certification of a class of California consumers who purchased CraveNx(TM) in the past four years. The company intends to file an answer to this complaint. Generex Biotechnology Corporation -- http://www.generex.com/-- is engaged in the research, development and commercialization of drug delivery systems and technologies. Generex has developed a proprietary platform technology for the delivery of drugs into the human body through the oral cavity (with no deposit in the lungs). The company's proprietary liquid formulations allow drugs typically administered by injection to be absorbed into the body by the lining of the inner mouth using the company's proprietary RapidMist(TM) device. The company's flagship product, buccal insulin (Generex Oral-lyn(TM)), which has been approved in India, Lebanon, Algeria, and Ecuador for the treatment of subjects with Type-1 and Type-2 diabetes, is in Phase III clinical trials at several sites around the world. Antigen Express, Inc. -- http://www.antigenexpress.com/-- is a wholly owned subsidiary of Generex. The core platform technologies of Antigen Express comprise immunotherapeutics for the treatment of malignant, infectious, allergic, and autoimmune diseases. HERLEY INDUSTRIES: Final Approval of Settlement Pact Pending ------------------------------------------------------------ Herley Industries, Inc., continues to await final approval of the settlement agreement resolving the matter In re Herley Industries, Inc. Securities Litigation, Docket No. 06-cv-2596 (JRS), according to the company's Oct. 14, 2010, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended August 1, 2010. Between June 2006 and August 2006, the company and certain of its current and former officers and directors were named as defendants in five related class actions alleging violations of the federal securities laws. Those cases were subsequently consolidated into one class action on behalf of a purported class of all persons who purchased or otherwise acquired shares of the company's stock during the period Oct. 1, 2001 through June 14, 2006. At all times during the pendency of the litigation, the company and the Individual Defendants have steadfastly maintained that the claims raised in the securities class action were without merit, and have vigorously contested those allegations. In July 2010, the company reached an agreement to settle all securities class actions. As part of the settlement, the company and the Individual Defendants continue to deny any liability or wrongdoing under the securities laws. The terms of the settlement provide for, in part, the dismissal of the litigation against the company and all of the Individual Defendants, and the creation by the company of a $10 million settlement fund. The fund will be allocated, after deduction of court-ordered expenses, such as attorneys' fees and expenses, settlement administration costs and any applicable taxes, among members of the settlement class who submit valid proofs of claim. Upon final approval of the settlement by the Court, in August 2010, the company paid $10 million out of existing cash reserves to create the settlement fund. Herley Industries, Inc. -- http://www.herley.com/-- is a leader in the design, development and manufacture of microwave technology solutions for the defense, aerospace and medical industries worldwide. Based in Lancaster, PA, Herley has seven manufacturing locations and approximately 1000 employees. LEAP WIRELESS: Accord on Suit Over Fin'l Restatement Gets Final OK ------------------------------------------------------------------ The Hon. Michael M. Anello grants final approval to the settlement and plan of allocation of settlement proceeds in the class action lawsuits captioned HCL Partners Limited Partnership, On Behalf of Itself and All Others Similarly Situated, v. Leap Wireless International, Inc., S. Douglas Hutcheson, Grant A. Burton And Amin I. Khalifa; and Kent Carmichael, Individually and On Behalf of All Others Similarly Situated, v. Leap Wireless International, Inc. S. Douglas Hutcheson, Mark H. Rachesky, Amin I. Khalifa and Dean M. Luvisa, case nos. 07-cv-2245 and 08-cv-0128 (S.D. Calif.). The actions arise from alleged misconduct by Defendant Leap Wireless and certain individual officers and directors of Leap. In April 2003, Leap filed for bankruptcy under Chapter 11, reorganized, and emerged in August 2004. On November 9, 2007, Leap announced that it would be restating its financial statements for fiscal years 2004-2006 and the first two quarters of 2007. The actions were triggered by Leap's restatement of its financial results, including the Company's reported net profits, and the price decline of Leap's common stock that occurred after the restatement was disclosed to investors. On November 27, 2007, four class actions were filed against defendants in the Court, alleging violations of the federal securities laws. Two of the actions were voluntarily dismissed. On May 22, 2008, the Court consolidated the two actions and appointed New Jersey Carpenters Pension and Benefit Funds as Lead Plaintiff, Schoengold Sporn Laitman & Lometti, P.C. as Lead Counsel, and Glancy Binkow as Liason Counsel. On April 30, 2010, the Court substituted Cohen Milstein Sellers & Toll PLLC as Lead Counsel. On July 7, 2008, Plaintiff filed the Consolidated Class Action Complaint. On August 28, 2008, Defendants filed a motion to dismiss. The Court granted the motion to dismiss, but granted Plaintiff leave to amend. On March 10, 2009, Lead Plaintiff filed the operative Second Amended Consolidated Complaint. Defendants collectively filed a motion to dismiss a second time. Following the briefing of the second motion to dismiss, and prior to the motion's scheduled hearing date, the parties engaged in extensive settlement negotiations, and ultimately agreed to a resolution of this action. Over several weeks, the parties discussed and negotiated several drafts of the stipulation of settlement, which was presented to the Court for preliminary approval. On March 24, 2010, the Court granted preliminary approval of the settlement. The settlement provides for a significant monetary benefit to the class. Approximately 7,500 claims were filed with the settlement administrator, without any requests for exclusion or objections to the settlement. The plan of allocation, written by Plaintiff's expert consultant, equitably distributes the proceeds of the settlement by taking into account the timing of class members' purchases, acquisitions and sales of Leap's common stock during and after the class period. Lastly, the plan accounted for attorneys' fees in an amount equal to 25% of the gross settlement fund, plus reimbursement of attorneys' out-of-pocket expenses. A copy of the Court's Order and Final Judgment dated Oct. 14, 2010, is available at http://is.gd/g6q1Efrom Leagle.com. MISTRAS GROUP: Unable to Reach Settlement in Mediation ------------------------------------------------------ Mistras Group, Inc., participated in a non-binding mediation in the matters Quiroz v. Mistras Group, Inc., and Ballard v. Mistras Group, Inc., et al., but was unable to reach a settlement, according to the company's Oct. 14, 2010, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended Aug. 31, 2010. The company is a defendant in two related purported class action lawsuits in California, based upon violations of California labor and employment law. The first case, Quiroz v. Mistras Group, Inc., et al, U.S. District Court, Central District of California (Case No. CV09-7146 PSG), was originally filed in California State court in September 2009, and was removed to Federal Court. This matter was a purported class action case on behalf of existing and former California employees of the company and its subsidiaries for violation of various labor and employment laws, primarily for failure to pay wages timely and for having defective wage statements, as well as other claims, and is seeking penalties under the California Private Attorneys General Act. In March 2010, the plaintiff's request to certify the case as a class action suit was denied. The Plaintiffs have sought to remand the case back to California State Court, but the Federal Court has retained jurisdiction. The second case is Ballard v. Mistras Group, Inc., et al, U.S. District Court, Central District of California (Case No. 2:10-cv- 03186 (PSG)), filed in late March 2010 in California State Court and removed to Federal court. This matter is also a purported class action case, based on substantially identical claims as the Quiroz case, and was filed by the same attorney representing the plaintiff in the Quiroz case, approximately two weeks after class action certification was denied in Quiroz. The plaintiff is attempting to remand this case back to California State Court and is seeking class action certification. In September 2010, the company participated in non-binding mediation for the Quiroz and Ballard cases together, but was unable reach a settlement. Mistras Group, Inc. -- http://www.mistrasgroup.com/-- offers one of the broadest "one source" services and technology-enabled asset protection solution portfolios in the industry used to evaluate the structural integrity of energy, industrial and public infrastructure. Mission critical services and solutions are delivered globally and provide customers with the ability to extend the useful life of their assets, improve productivity and profitability, comply with government safety and environmental regulations and enhance risk management operational decisions. Mistras uniquely combines its industry leading products and technologies - 24/7 on-line monitoring of critical assets; mechanical integrity and non-destructive testing services; and its proprietary world class data warehousing and analysis software -- to provide comprehensive and competitive products, systems and services solutions from a single source provider. NTI GLOBAL: Sued in Mo. for Falsely Representing Agility Tunnels ---------------------------------------------------------------- Joe Harris at Courthouse News Service reports that a company's dog agility tunnels don't work as advertised, a class action claims in City Court. The class of agile dog owners seeks damages from New York-based NTI Global. Named plaintiff Jennifer McDonald says the tunnels fall apart under normal use. McDonald seeks damages and punitive damages. A copy of the Complaint in McDonald v. NTI Global, Inc., Case No. 1022-CC11402 (Mo. Cir Ct., St. Louis Cty.), is available at: http://www.courthousenews.com/2010/10/18/DogTunnels.pdf The Plaintiff is represented by: Mark I. Bronson, Esq. NEWMAN BRONSON & WALLIS 2300 West Port Plaza Dr. St. Louis, MO 63146-3213 Telephone: (314) 878-8200 E-mail: mbronson@newmanbronson.com QANTAS AIRWAYS: Court Sets Nov. 15 Fuel Surcharge Claims Bar Date ----------------------------------------------------------------- etravelblackboard.com reports that the Federal Court of Australia has issued travel agents with a November 15 deadline to make a claim against Qantas Airways Limited for unpaid fuel surcharge commissions. Last month, Qantas lost a High Court application to appeal a ruling that found the airline failed to include fuel surcharges when calculating the commission paid to agents on international tickets sold between 2004 and 2007. Travel agents can join the class action and make a claim against Qantas if, between 11 May 2004 and 9 May 2007, they met the following conditions: * they were incorporated and their principal place of business was in Australia; * they were a party to the IATA Passenger Sales Agency Agreement; * they sold international published fares on behalf of Qantas, British Airways and Air New Zealand; and * they have not lodged an Opt Out Notice with the Federal Court. Thus far, joining the "successful" claim are "mums & dads" agents including franchisees and members from Harvey World Travel, Jetset Travelworld Group and Travelscene American Express, according to Slater & Gordon lawyer Steven Lewis. "The order from the Federal Court is an important step forward in the travel agents being paid what they are owed by Qantas," Mr. Lewis said. "For almost four years travel agents have been involved in a David and Goliath legal battle against one of Australia's biggest companies," Mr. Lewis said. "Now, after a historic win that will reverberate around the airline industry, they will start to receive what they are owed." Qantas have reportedly claimed it will cost up to $26 million "just to cover the additional commissions owed to travel agents" between 2004 and 2007. Upon the completion of the Qantas proceedings, similar claims against British Airways, Air New Zealand, Singapore Airlines and Cathy Pacific will be heard. To make a claim, travel agents can contact either Slater & Gordon directly or approach the Federal Court, New South Wales Registry. SALT LAKE: District Attorney Sued Over Inflated Discovery Fees -------------------------------------------------------------- Jonny Bonner at Courthouse News Service reports that the Salt Lake County District Attorney is building a PR empire on the backs of defendants, the Utah Association of Criminal Defense Lawyers claims in a state class action. The group claims District Attorney Lohra Miller charges defense attorneys "wildly inflated" fees that "do not reflect actual costs" of copying documents and tapes, and uses the money to fund her office, for which she has created a public relations staff nearly as big as the one in Los Angeles, which has nine times the population and 10 times as many attorneys. The Utah Association of Criminal Defense Lawyers claims that while Ms. Miller was increasing fees for discovery, she sought salary increases for herself three times, and adds that whacking just one member of her PR staff "would be more than adequate to cover all of the fees she is trying to extract from defendants who are doing no more than seeking access to the evidence they are entitled to under the United States and Utah Constitutions." On June 16, 2009, at Ms. Miller's recommendation, the Salt Lake City Council adopted a schedule of fees to be charged to nonindigent defendants in criminal cases. The attorneys claim the standards used to determine indigence are unduly harsh, that "Someone supporting a family of four who earns just $14.90 an hour will be charged fees to obtain discovery." Before June 2009, defense attorneys obtained copies of documents and allied information from prosecutors without charge, according to the complaint in Salt Lake County Court. "About 80 percent of the approximately 18,000 cases filed by the District Attorney's Office are assigned to the Salt Lake Public Defender Association," the UACDL says. But "the schedule of fees does not apply to those represented by public defenders." "As is obvious from even a cursory review of the schedule of fees, the fees bear no relationship whatsoever to actual costs," the attorneys say. For example, the cost per page for black-and-white copies ranges from 75 cents to $3. The "grossly inflated" charges "fund the district attorney's outsized salary and her public relations department, which rivals in size that of the Los Angeles district attorney" and "are set to offset budget gaps . . . not to pay for discovery itself," according to the complaint. "Ms. Miller has set fees in order to force defendants -- individuals who are presumed innocent -- to fund the operation of the District Attorney's office. Ms. Miller cannot justify the fee imposition by pointing to budgetary concerns. At the same time that Ms. Miller has imposed illegal fees on defendants attempting to obtain discovery materials, she sought three separate increases in her own salary. In fact, she is now paid more than the Attorney General of Utah. At the same time she was imposing fees on defendants, she created a public relations staff that is almost the same size as that of the office of the Los Angeles District Attorney, an agency serving a county more than nine times as populous, with ten times as many attorneys as in the Salt Lake District Attorney's office. The cost of just one of Ms. Miller's public relations employees would be more than adequate to cover all of the fees she is trying to extract from defendants who are doing no more than seeking access to the evidence they are entitled to under the United States and Utah Constitutions." The complaint adds: "Ms. Miller refused to undertake any study, let alone the statutorily required assessment, of the actual costs of providing discovery materials to defendants. Instead, Ms. Miller established a fee schedule based on nothing more than speculation. In a related case, the District Attorney admitted to the Court that it did not do an adequate analysis of the actual costs of preparing discovery, because it could not be bothered. The District Attorney made no effort even to discuss with the Auditor how to make a determination of actual costs, although involvement of the Auditor is mandatory under municipal law. As a result, the fees imposed by Ms. Miller are grossly disproportions to the actual costs of discovery production, and impose improper burdens on defendants. Her fees are significantly higher than the costs recoverable in private litigation by public or private person, whether before the state or federal courts." The defense attorneys add: "The effect of the changes imposed by Ms. Miller has been, and will continue to be, to impair the ability of defendants to prepare their cases and to deprive them of meaningful discovery, contrary to both the United States and Utah Constitutions and to improperly burden defendants and their counsel." To make it perfectly clear, the attorney say: "Ms. Miller and the county manipulate application of the schedule of fees to increase general revenues and to selectively punish defendants and their counsel." The group claims the charges are inconsistent with the Utah Rules of Criminal Procedure, interfere with defendants' right to a speedy trial, violate the Sixth Amendment "both to the presumption of innocence and to the disclosure by prosecutors of all exculpatory evidence," and violates Article I, Section 12 of the Utah Constitution, "which guarantees that an accused shall not 'be compelled to advance money or fees to secure' his or her rights to a criminal case." The fees also delay discovery, which delays trial dates and plea negotiations and raises court costs because cases remain on the docket longer. The group claims the U.S. Attorney does not charge for discovery, nor does the attorney general of Utah impose fees on discovery for defendants in criminal cases. Neither do Cache, Summit, or Wasatch Counties. Davis, Weber, and Washington Counties charge a $5 flat fee. The class of more than 1,000 attorneys wants the new charges enjoined, damages for the money already collected, and costs. A copy of the Complaint in Utah Association of Criminal Defense Lawyers, et al. v. Miller, et al., Case No. 100919560 (Utah Jud. Dist. Ct., Salt Lake Cty.), (Lindberg, J.), is available at: http://www.courthousenews.com/2010/10/18/SaltLakeDA.pdf The Plaintiffs are represented by: John H. Bogart, Esq. TELOS VG, PLLC 299 South Main St., Suite 1300 Salt Lake City, UT 84111 Telephone: (801) 535-4304 E-mail: jbogart@telosvg.com SANOFI-AVENTI US: Sued for Non-Payment of Overtime Wages -------------------------------------------------------- Alan Saldana, on behalf of himself and others similarly situated v. Sanofi-Aventis U.S. Inc., Case No. 10-cv-04672 (N.D. Calif. October 15, 2010), accuses the N.J.-based international pharmaceutical company of requiring its employees to work more than eight hours per day without paying them overtime wages, failing to provide accurate itemized wage statements, and failing to provide compensation for missed meal periods, in violation of California state wage and hour laws. Mr. Saldana and the class members seek, among other things, injunctive relief, restitution, and disgorgement of all benefits defendants enjoyed from their failure to pay overtime and meal period compensation. Mr. Saldana is employed by Sanofi-Aventis as a pharmaceutical representative in the State of California. The Plaintiff is represented by: Eric B. Kingsley, Esq. Liane L. Katzenstein, Esq. KINGSLEY & KINGSLEY, APC 16133 Ventura Blvd., Suite 1200 Encino, CA 91436 Telephone: (818) 990-8300 E-mail: eric@kingsleykingsley.com lkatzenstein@kingsleykingsley.com - and - Charles Joseph, Esq. JOSEPH & HERZFELD LLP 757 Third Avenue, 25th Floor New York, NY 10017 Telephone: (212) 688-5640 - and - Michael Dichiara, Esq. DICHIARA LAW FIRM LLC 77 Market Street, Suite 2 Park Ridge, NJ 07656 Telephone: (201) 746-0303 E-mail: charles@JHLLP.com SOURCE FOR PUBLIC DATA: Settlement in Drivers' Class Suit Okayed ---------------------------------------------------------------- Joe Harris at Courthouse News Service reports that a class action that an attorney claimed might bankrupt Missouri has been settled for $90,000. U.S. District Judge Nanette Laughrey gave final approval last week to the settlement between Missouri drivers and The Source for Public Data and Shadowsoft. Plaintiffs claimed The Source for Public Data and Shadowsoft illegally obtained a database from the Missouri Department of Motor Vehicles, with confidential information about Missouri drivers, and sold it to third parties, violating the Federal Driver's Privacy Protection Act. Ten employees of the Missouri Department of Motor Vehicles were named as defendants. The state itself could not be sued. The settlement "requires the return of all personal information that is in the possession of Shadowsoft and Source for Public Data. It prevents further reselling of such information and greatly reduces the risk of identity theft and the illegal use of such information from Missouri drivers," court papers state. The defendants will pay $90,000, to go toward attorney's fees; of that, $3,000 will be split evenly between the two lead plaintiffs. The defendants have not admitted guilt as part of the settlement. Mitchell Burgess, an attorney for plaintiffs, told Courthouse News when the complaint was filed that it had the potential to bankrupt Missouri. He pointed out that federal law allows for damages of up to $2,500 a person. If 100,000 people were involved, damages could get as high as $250 million. Mr. Burgess told Courthouse News that the class could number in the millions. Both sides said they believe the settlement is reasonable. "The settlement provides immediate relief. It requires the return of all personal information that is in the possession of Shadowsoft and Source for Public Data. It prevents further reselling of such information and greatly reduces the risk of identity theft and the illegal use of such information from Missouri drivers." A copy of the Honorable Nanette K. Laughrey's Oct. 12, 2010, Order and Judgment in Roberts, et al. v. The Source for Public Data LP, et al., Case No. 08-cv-04167 (W.D. Mo.), is available at: http://www.courthousenews.com/2010/10/18/MissouriSettle.pdf SPRINGFIELD, MO: Suit Over Red-Light Ticket System Dismissed ------------------------------------------------------------ Joe Harris at Courthouse News Service reports that a federal judge dismissed a class action against Springfield's red-light traffic cameras. U.S. District Judge Nanette K. Laughery denied claims that the $800,000 in fines the city has collected violated drivers' due process rights. Springfield's red-light ticket system was taken offline in March after the Missouri Supreme Court ruled that Springfield's method of handling red-light tickets violated state law. The state Supreme Court ruled that Springfield had to handle the tickets through its court system, not through administrative hearings. The class consists of drivers who had already paid the $100 fine before the Supreme Court's ruling. "Plaintiffs cannot challenge on due process grounds the procedures they opted not to use," Judge Laughery wrote. "Given the procedural posture of this case, the Court declines to exercise jurisdiction in the absence of a live claim or controversy. Plaintiffs have no standing to challenge the administrative procedures under Sections 106-161 because they cannot trace any deprivation or threatened deprivation of property to any of that ordinance's adjudicative procedures, having declined to avail themselves of any such procedures." A copy of the Honorable Nanette K. Laughrey's Sept. 3, 2010, Order in Mills, et al. v. City of Springfield, et al., Case No. 10-cv- 04036 (W.D. Mo.), is available at: http://www.courthousenews.com/2010/10/18/RedLight.pdf TICKETMASTER.COM: Partial Fee Refunds in Class Suit Likely ---------------------------------------------------------- Jennifer Bissell, writing for mndaily.com, reports that those who bought tickets from Ticketmaster.com in approximately the past 10 years may have a chance to have a portion of the price refunded. A class-action lawsuit will determine if Ticketmaster's order processing and UPS delivery fees are deceptive and lead customers to believe the price is representative of the costs to process and deliver the tickets. Companies feel they can "get away with" these kinds of small fees because "nobody in their right mind" is going to sue over it, prosecuting lawyer Robert Stein said. "There's no incentive for them to do business honestly." Plaintiffs claim Ticketmaster's fees violate California's false advertising law and unfair competition law, according to a court document. The case has been classified as a class-action suit, so it includes all U.S. residents who have bought tickets from Ticketmaster.com between Oct. 21, 1999 and May 31, 2010. If found liable, Ticketmaster may have to refund a portion of the fees back to its customers. "The amount in question is small for any given person, but the amount is large overall," Mr. Stein said. "This [type of suit] is really what keeps companies honest at the end of the day." The case, filed in California roughly seven years ago, will be heard before a nonjury trial in the state's Superior Court on Jan. 26, 2011. The court ordered an e-mail be sent to the members of the class to notify them of the case and opportunities to opt out. It was sent Oct. 8. Additionally, a Web site with court documents has been launched. Ticketmaster's attorney Jeff Scott declined to comment, citing company policy against discussing pending litigation. About 55% of advanced ticket sales at music venue First Avenue are sold through Ticketmaster, said First Avenue general manager Nathan Kranz. The vast majority of the more expensive shows, however, are Ticketmaster sales, opposed to fan club or box office tickets, Mr. Kranz added. "I'm always amazed at how many customers actually use Ticketmaster," Mr. Kranz said. "People are so used to buying tickets through them that Ticketmaster has been able to, I guess, use that market share to raise prices on people." Mr. Kranz said a lot of people use Ticketmaster because they aren't aware of any other options or simply because of convenience. "[It's the] same reason why people would drive their car downtown to pay $13 to park when they could take a bus," Mr. Kranz said. Since Ticketmaster's merger with fellow ticket provider Live Nation, which has allowed for more control over ticket prices, fewer venues have wanted to contract with Ticketmaster, Mr. Kranz said. "We're still a Ticketmaster venue because we're under contract, but we're certainly looking at all of our options," Mr. Kranz said. "They weren't called a monopoly by the government, but from where I sit it certainly looks like one." "I think it's pretty terrible that they can just charge whatever they want," Mr. Kranz added. "Once you're under contract you have very little that you can do to keep the fees at a somewhat reasonable level." UNITED STATES: Faces Potential Class Suit Over Moose Collisions --------------------------------------------------------------- VOCM.COM reports St. John's lawyer Ches Crosbie has been helping moose collision victims obtain financial compensation for years. Now he's looking at the possibility of a class-action lawsuit for these victims. Mr. Crosbie says government could be held accountable as they introduced moose to the province in 1912. If the hazard that moose pose to traffic was foreseeable a hundred years ago, government could be held liable for negligence. Mr. Crosbie says the purpose of the class action would be compensation for the injured, and measures to reduce or prevent collision dangers posed by moose. WAL-MART STORES: Accused in N.J. of Hiring Undocumented Migrants ---------------------------------------------------------------- Chris Fry at Courthouse News Service reports that in a federal class action, 42 named plaintiffs say Wal-Mart hired them knowing they were undocumented, stiffed them for overtime and for regular wages, paid them in cash or by personal checks from labor contractors, put them to forced labor through coercion, "violated immigration, money laundering and protective wage and hour laws," and routinely locked them inside stores while they worked night shifts. Wal-Mart and some of its contractors settled federal complaints and paid millions in fines. The named plaintiffs, suing for the class, seek the wages of which they were cheated, and other damages. Most of the named plaintiffs have names that indicate Eastern European descent, particularly Polish and Czech. Many say they worked more than 40 hours a week, seven days a week, and never were paid overtime. Lead plaintiff Victor Manuel Zavala, one of two named plaintiffs with Latino surnames, claims that "beginning in no later than March 1997, senior Wal-Mart management, realizing that Wal-Mart could substantially reduce costs and substantially increase profits were it to rely on the labor of undocumented migrants to clean its thousands of stores, created a criminal enterprise that involved conspiracies to violate, as well as substantive violations, of federal immigration laws and other laws." The class claims Wal-Mart engaged in a criminal RICO conspiracy involving "the employment, encouragement, harboring and transporting of undocumented workers," which the company hired through outside contractors. Wal-Mart did it to duck taxes, including Social Security, and government regulations and to avoid having to pay for health benefits, according to the complaint. The class claims Wal-Mart "sheltered the undocumented migrants by arranging or providing lodging for them and routinely transporting them across the United States to work at different Wal-Mart locations." The plaintiffs say that the company structures its business operations "in multiple shell corporations so as to shield the continued employment of the migrants from detection" and that "senior Wal-Mart executives . . . knew of the scheme" and "permitted it to flourish." The complaint adds: "The Wal-Mart Enterprise was directed by Divisional Vice Presidents within the Wal-Mart Stores Division with responsibility for in-store cleaning and procurement of services." The class claims that Wal-Mart typically paid their wages to outside contractors, who then paid the migrant workers in cash or sometimes by personal check. They also claim Wal-Mart locked them in stores overnight, "intentionally" and "against their will." Class members who complained about the treatment were "threatened with deportation or other adverse legal action." Wal-Mart paid an $11 million fine in 2005 "in order to avoid criminal penalties" after being accused of many illegal immigrants to "provide floor cleaning services" from 1998 to 2003, according to the complaint. "This action is directed at compensating the named plaintiffs and the class they represent for the harm caused them by this criminal enterprise." They seek back wages and treble and punitive damages for RICO violations, conspiracy, violations of the Fair Labor Standards Act and false imprisonment. A copy of the Complaint in Zavala, et al. v. Wal-Mart Stores, Inc., Case No. 10-cv-_____, docketed as Doc. 9702 in Case No. 33- av-00001 on Oct. 14, 2010 (D. N.J.), is available at: http://www.courthousenews.com/2010/10/18/Walmart.pdf The Plaintiffs are represented by: James L. Linsey, Esq. COHEN, WEISS AND SIMON LLP 330 West 42nd St. New York, NY 10036 Telephone: (212) 563-4100 WASHINGTON MUTUAL: Class in Securities Suit Wins Certification -------------------------------------------------------------- Alison Frankel, writing for The American Lawyer, reports that while the shareholders of Washington Mutual Inc. wait anxiously for the Nov. 1 examiner's report in WMI's Chapter 11 to find out if they have any hope of recovery through the bankruptcy process, they can rest assured that things are looking very good in their securities class action against some very deep-pocketed defendants. On October 13, Seattle federal district court Judge Marsha Pechman granted the plaintiffs' motion for class certification, giving the green light to investors who bought WaMu shares in three offerings between 2005 and 2008, when the company went bust. Judge Pechman previously denied defense motions to dismiss the securities class action, so the WMI shareholders will now proceed to court-ordered mediation against four groups of defendants: -- the former officers of Washington Mutual Inc. (represented by Simpson Thacher & Bartlett); -- the former WMI directors (represented by Perkins Coie); -- 15 underwriters, including most of the biggest investment and commercial banks in the U.S. (represented by Gibson, Dunn & Crutcher); and -- WaMu's former auditor, Deloitte & Touche (represented by Latham & Watkins). According to an Oct. 13 joint status report, the parties (including the 11 insurance carriers that issued D&O policies to WMI's former directors and officers) have agreed that the mediation will be overseen by former federal district court Judge Layn Phillips of Irell & Manella. Mediation sessions may begin as soon as December. Judge Pechman's class certification ruling also confirmed Bernstein Litowitz Berger & Grossmann -- counsel to the lead plaintiff, Ontario Teachers' Pension Board -- as class counsel. The defendants had challenged Bernstein's involvement in the case, arguing that the firm pressured two other named plaintiffs to join the litigation. The judge said that some of Bernstein's tactics "strike the court as unseemly," but she nevertheless found that the firm satisfied the lead counsel requirements of the Private Securities Litigation Reform Act. She also, interestingly, said she was "alarmed by the prospect" that other plaintiffs firms would try to claim a share of attorney fees. "The briefing on class certification has revealed that two firms, Sugarman & Susskind, P.A., and Saxena White appear only to be shepherding plaintiffs to Bernstein Litowitz," Judge Pechman wrote. "The court cautions that no fees will be awarded unless actual legal work is done by an individual lawyer to further the present litigation, and any fee sharing relationship will be closely scrutinized." Barry Ostrager of Simpson told us the former WMI directors intend to appeal Judge Pechman's class certification ruling. "We think there are issues with respect to the appropriateness of certification," he said. "Those will be raised on appeal." ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Gracele D. Canilao, Leah Felisilda, Rousel Elaine Fernandez, Joy A. Agravante, Ronald Sy, Christopher Patalinghug, Frauline Abangan and Peter A. Chapman, Editors. Copyright 2010. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $575 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *