/raid1/www/Hosts/bankrupt/CAR_Public/110511.mbx
C L A S S A C T I O N R E P O R T E R
Wednesday, May 11, 2011, Vol. 13, No. 92
Headlines
ADVANCED BATTERY: May 31 Lead Plaintiff Deadline Set
AETNA INC: New Jersey MDL Suit Still Pending
AIRTRAN HOLDINGS: To Enter Into Stipulation Pursuant to MOU
AIRTRAN HOLDINGS: Continues to Defend Antitrust Suit in Georgia
APARTMENT INVESTMENT: May Be Named in Potential Class Action
APPLE INC: Illinois Resident Files Class Action Over iOS
BANCOLOMBIA SA: Appeal of Ruling in "Girona" Suit Still Pending
BANCOLOMBIA SA: Plaintiffs Appeal Property Damage Claims Denial
BED BATH: Removes "Bennett" Song-Beverly Suit to N.D. Calif.
BLACK & DECKER: 2nd Circuit Revives Overtime Class Action
BORDERS GROUP: Continues to Defend Employee Suit in California
CHEMED CORPORATION: Continues to Defend Wage Suit in New York
CHEMED CORPORATION: Continues to Defend Wage Suit in California
CYBERDEFENDER CORP: Sued for Engaging in Deceptive Advertising
DEAN FOODS: July 18 Hearing Set for Class Action Settlement
DIRECTBUY: Public Citizen Opposes Class Action Settlement
DPL INC: Faces Three Merger-Related Class Suits
DYNAMICS RESEARCH: Ready to Carry Out Terms of Class Settlement
EAGLE EXPRESS: Sued for Unpaid Overtime Wages
ELECTRONIC ARTS: Rejects Some Conspiracy Claims in Class Action
ELI LILLY: Bid for Review of "Zyprexa" Case Ruling Pending
ENSCO PLC: Defends Shareholder Suits Over Merger with Pride Int'l.
GERON CORP: Calif. Court Orders Dismissal of Class Action Suit
INTERNAP NETWORK: Awaits Ruling on Motion to Dismiss Fraud Suit
JIMMY CARTER: Class Action Over Book on Palestine Withdrawn
KINDER MORGAN: Awaits Final Hearing in Second Arbitration
LEXISNEXIS RISK: Faces Class Action Over Employment Database
MECOX LANE: Amended Consolidated Complaint to be Filed Soon
NETFLIX INC: Blockbuster Clients Excluded From Walmart Suit
NZ FINANCE COS: Trustee Class Action Gets 2200 Claims
OFFICEMAX NORTH: Removes "Thoms" Song-Beverly Suit to N.D. Calif.
OVERSTOCK.COM INC: Appeal of Ruling in "Lane" Suit Still Pending
OVERSTOCK.COM INC: Awaits Ruling on Motion to Dismiss "Hines" Suit
PUDA COAL: June 13 Class Action Lead Plaintiff Deadline Set
RENT-A-CENTER INC: Accrues $2.8MM on Potential Settlement of Suits
ROTHMAN FURNITURE: Faces Consumer Fraud Class Action
SILICON LABORATORIES: Awaits Ruling on Motion to Dismiss Appeals
SMURFIT-STONE: Reaches Settlement in Principle in ERISA Suit
SMURFIT-STONE: Continues to Defend Antitrust Suits in Illinois
SMURFIT-STONE: Preliminary Injunction Hearing Set for May 18
SMURFIT-STONE: Merger Suit Still Stayed Pending Delaware Action
SMURFIT-STONE: Continues to Defend "Dabrowski" Suit in Illinois
SONIC AUTOMOTIVE: Awaits Approval of Settlement in "Galura" Suit
SONIC AUTOMOTIVE: Wants Arbitrator's Partial Final Award Vacated
SONY COMPUTER: Sued for Concealing Inherent Defect in PS3 Consoles
SONY COMPUTER: Faces 8th Suit Over Private Data Breach
SONY COMPUTER: Faces 9th Suit Over Private Data Breach
TEXAS: Comptroller Faces Second Privacy Class Action
TOLLGRADE COMMUNICATIONS: Settles "Tencza", "Equity Benefit" Suits
UMH PROPERTIES: Sued in Tenn. Over Deceptive Consumer Practices
WELLCARE HEALTH: Class Action Settlement Gets Final Approval
WYETH INC: Faces Antitrust Class Action Over Effexor Drug
* AUSTRALIA: May Face Class Suit Over Solar Panel Tariff System
*********
ADVANCED BATTERY: May 31 Lead Plaintiff Deadline Set
----------------------------------------------------
The Rosen Law Firm, P.A. reminds investors of the important
May 31, 2011 lead plaintiff deadline in the Advanced Battery
securities action filed by the firm. If you purchased the common
stock of Advanced Battery Technologies, Inc., during the period
from March 16, 2009, through March 29, 2011, you should contact
the Rosen Law Firm for more information about the importance of
serving as lead plaintiff. The lawsuit is seeking to recover
damages for investors from violations of federal securities laws.
To join the Advanced Battery class action, visit the Rosen Law
Firm's Web site at http://rosenlegal.comor call Laurence Rosen,
Esq., or Timothy Brown, Esq., toll-free, at 866-767-3653; you may
also email lrosen@rosenlegal.com or tbrown@rosenlegal.com for
information on the class action.
If you wish to serve as lead plaintiff, you must move the Court no
later than May 31, 2011. A lead plaintiff is a representative
party acting on behalf of other class members in directing 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.
Timothy Brown, Esq.
THE ROSEN LAW FIRM P.A.
275 Madison Avenue 34th Floor
New York, New York 10016
Telephone: (212) 686-1060
Weekends Tel: (917) 797-4425
Toll Free: 1-866-767-3653
E-mail: lrosen@rosenlegal.com
tbrown@rosenlegal.com
Web site: http://www.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 may choose to do nothing at this point and remain
an absent class member.
The Rosen Law Firm represents investors throughout the globe,
concentrating its practice in securities class actions and
shareholder derivative litigation.
AETNA INC: New Jersey MDL Suit Still Pending
---------------------------------------------
Several motions are currently pending in the multidistrict
litigation involving Aetna, Inc., in connection with its practices
related to the payment of claims for services rendered to its
members by out-of-network providers, according to the Company's
April 28, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2011.
The Company is named as a defendant in several purported class
actions and individual lawsuits arising out of its practices
related to the payment of claims for services rendered to its
members by health care providers with whom the Company does not
have a contract ("out-of-network providers"). Other major health
insurers are also the subject of similar litigation or have
settled similar litigation. Among other things, these lawsuits
allege that the Company paid too little to its health plan members
and/or providers for these services, among other reasons, because
of its use of data provided by Ingenix, Inc., a subsidiary of one
of the Company's competitors.
Various plaintiffs who are health care providers or medical
associations seek to represent nationwide classes of out-of-
network providers who provided services to the Company's members
during the period from 2001 to the present. Various plaintiffs
who are members in the Company's health plans seek to represent
nationwide classes of the Company's members who received services
from out-of-network providers during the period from 2001 to the
present. Taken together, these lawsuits allege that the Company
violated state law, the Employee Retirement Income Security Act of
1974, as amended, the Racketeer Influenced and Corrupt
Organizations Act and federal antitrust laws, either acting alone
or in concert with the Company's competitors. The purported
classes seek reimbursement of all unpaid benefits, recalculation
and repayment of deductible and coinsurance amounts, unspecified
damages and treble damages, statutory penalties, injunctive and
declaratory relief, plus interest, costs and attorneys' fees, and
seek to disqualify the Company from acting as a fiduciary of any
benefit plan that is subject to ERISA. Individual lawsuits that
generally contain similar allegations and seek similar relief have
been brought by a health plan member and by out-of-network
providers.
The first class action case was commenced on July 30, 2007. The
federal Judicial Panel on Multi-District Litigation has
consolidated these class action cases in the U.S. District Court
for the District of New Jersey under the caption In re: Aetna UCR
Litigation, MDL No. 2020. In addition, the MDL Panel has
transferred the individual lawsuits to MDL 2020. Discovery is
substantially complete in MDL 2020, several motions are pending,
and briefing on class certification has been completed. The court
has not set a trial date or a timetable for deciding class
certification.
The Company says it intends to vigorously defend itself against
the claims brought in these cases. The Company also says that it
has received subpoenas and/or requests for documents and other
information from, and been investigated by, attorneys general and
other state and/or federal regulators, legislators and agencies
relating to the Company's out-of-network benefit payment
practices. It is reasonably possible that others could initiate
additional litigation or additional regulatory action against the
Company with respect to its out-of-network benefit payment
practices.
AIRTRAN HOLDINGS: To Enter Into Stipulation Pursuant to MOU
-----------------------------------------------------------
AirTran Holdings, Inc., will enter into a stipulation of
settlement pursuant to a memorandum of understanding entered with
parties in Nevada class action lawsuits arising from the Company's
proposed merger with Southwest Airlines, according to the
Company's April 29, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2011.
As of April 21, 2011, eight purported class action lawsuits have
been filed on behalf of the Company's shareholders in connection
with the Company's proposed merger with Southwest Airlines. Four
cases were brought in Nevada: three in Nevada state court
(Leonelli, No. 10-OC-00448 1B; Frohman, No. 10-OC-00449 1B;
Church, No. A-10-626971-C), and one in federal court (Nesbit, No.
2:11-cv-00092 (PMP)(GWF)). Four cases were brought in Florida
state court (DeBardelaben, No. 2010-CA-022893-O; Hoffner, No.
2010-CA-022143-O; Loretisch, No. 2010-CA-023520-O; Rosenberger,
No. 2010-CA-023117-O). The allegations in all eight complaints
were similar. In each case, plaintiffs allege that the members of
the board of directors of the Company violated their fiduciary
duties to the company by voting to approve the proposed merger and
that the Company, Southwest and Merger Sub aided and abetted the
board in breaching those duties. In each case, plaintiffs
generally seek injunctive relief: (i) enjoining the defendants
from consummating the merger unless the Company adopts and
implements a procedure or process to obtain the highest possible
price for its stockholders and discloses all material information
to its stockholders, (ii) directing the board to exercise their
fiduciary duties to obtain a transaction that is in the best
interests of the Company's stockholders, (iii) rescinding, to the
extent already implemented, the merger agreement, including the
deal protection devices that may preclude premium competing bids
for the Company, (iv) awarding plaintiffs' costs and disbursements
of the action, including reasonable attorneys' and experts' fees,
and (v) granting such other and further equitable relief as the
court may deem just and proper. The Leonelli and Frohman cases
were consolidated on November 24, 2010, and plaintiffs filed a
Consolidated Complaint on December 14, 2010. The AirTran
Defendants moved to dismiss the Consolidated Complaint on
January 7, 2011. Plaintiffs in the consolidated case have not yet
filed an opposition to that motion. Discovery in the consolidated
case is in its early stages. The plaintiff in Church voluntarily
dismissed that case on November 30, 2010, and filed a new
complaint in the United States District Court for the District of
Nevada on December 2, 2010. The federal action raises
substantially the same claims as in the state case, except
plaintiff added claims under Sections 14(a) and 20(a) of the
Securities Exchange Act based on the preliminary proxy statement.
On December 9, 2010, the plaintiff in Church moved for expedited
discovery, which was denied on December 29, 2010. On December 20,
2010, the AirTran Defendants moved to dismiss the complaint, and
on December 22, 2010, the AirTran Defendants moved to stay
discovery pursuant to the Private Securities Litigation Reform
Act. The plaintiff filed an opposition to the motion to stay
discovery on January 7, 2011, but has not yet filed an opposition
to the motion to dismiss. The complaint in Nesbit was filed on
January 18, 2011. On February 9, 2011, after the plaintiff refused
to voluntarily withdraw the complaint, the AirTran Defendants and
the Southwest Defendants moved for a stay pending approval of the
Memorandum of Understanding. Over the Plaintiff's objections, the
magistrate judge recommended approval of the motion to stay on
March 31, 2011. The magistrate also recommended that the
plaintiff's motion for expedited discovery, which had been filed
in connection with his opposition to the stay motion, be denied.
The plaintiff moved for reconsideration of the magistrate's
recommendations on April 11, 2011. The AirTran Defendants filed
motions to stay the four Florida cases in favor of the cases in
Nevada. The court granted such motions on December 2, 2010.
While Southwest, AirTran, and the individual AirTran defendants
believe that each of the lawsuits is without merit, the parties to
the Leonelli consolidated complaint and the Church federal
complaint entered into a Memorandum of Understanding (MOU) on
January 26, 2011, to settle those lawsuits. The settlement
provides for the inclusion of additional disclosures with respect
to various aspects of the merger in the proxy statement/prospectus
with respect to the proposed merger with Southwest. In addition,
it provides for the payment of plaintiffs' attorneys' fees and
expenses, subject to court approval. The MOU further provides that
the parties will enter into a stipulation of settlement which will
provide, among other things, for the conditional certification of
a settlement class. The MOU and stipulation of settlement are
subject to various conditions, including court approval following
notice to the Company's stockholders, completion of certain
discovery and consummation of the merger. If the settlement is
finally approved, it will resolve and release on behalf of the
entire class of the Company's stockholders, all claims that were
or could have been brought challenging any aspect of the merger,
the merger agreement and any disclosure made in connection
therewith, among other claims.
About AirTran Holdings
Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE:
AAI) -- http://www.airtran.com/-- through its wholly owned
subsidiary, AirTran Airways, Inc., operates scheduled airline
service throughout the United States and to selected international
locations.
At Dec. 31, 2010, the Company's balance sheet showed $2.18 billion
in total assets, $1.64 billion in total liabilities, and
$539.36 million in total stockholders' equity.
AIRTRAN HOLDINGS: Continues to Defend Antitrust Suit in Georgia
---------------------------------------------------------------
AirTran Holdings, Inc., continues to defend itself in a
consolidated class action lawsuit alleging violations of antitrust
laws before a Georgia federal court, according to the Company's
April 29, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2011.
A complaint alleging violations of federal antitrust laws and
seeking certification as a class action was filed against Delta
Air Lines, Inc. (Delta) and the Company in the United States
District Court for the Northern District of Georgia in Atlanta on
May 22, 2009. The complaint alleges, among other things, that the
Company attempted to monopolize air travel in violation of Section
2 of the Sherman Act, and conspired with Delta in imposing $15-
per-bag fees for the first item of checked luggage in violation of
Section 1 of the Sherman Act. The initial complaint sought treble
damages on behalf of a putative class of persons or entities in
the United States who directly paid Delta and/or the Company such
fees on domestic flights beginning December 5, 2008. Subsequent to
the filing of the May 2009 complaint, various other nearly
identical complaints also seeking certification as class actions
were filed in federal district courts in Atlanta, Georgia;
Orlando, Florida; and Las Vegas, Nevada. All of the cases were
consolidated before a single federal district court judge in
Atlanta. A Consolidated Amended Complaint filed in the
consolidated action on February 1, 2010 broadened the allegations
to add claims that Delta and the Company conspired to cut capacity
on competitive routes and raise prices in violation of Section 1
of the Sherman Act, and that Delta attempted to monopolize air
travel in violation of Section 2 of the Sherman Act. In addition
to treble damages, the Consolidated Amended Complaint seeks
injunctive relief against a broad range of alleged anticompetitive
activities, as well as attorneys' fees. On August 2, 2010, the
Court dismissed plaintiffs' claims that AirTran and Delta had
violated Section 2 of the Sherman Act; the Court let stand the
claims of a conspiracy with respect to the imposition of a first
bag fee and the airlines' capacity and pricing decisions. The
Company denies all allegations of wrongdoing, including those in
the Consolidated Amended Complaint, and intends to defend
vigorously any and all such allegations.
About AirTran Holdings
Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE:
AAI) -- http://www.airtran.com/-- through its wholly owned
subsidiary, AirTran Airways, Inc., operates scheduled airline
service throughout the United States and to selected international
locations.
At Dec. 31, 2010, the Company's balance sheet showed $2.18 billion
in total assets, $1.64 billion in total liabilities, and
$539.36 million in total stockholders' equity.
APARTMENT INVESTMENT: May Be Named in Potential Class Action
------------------------------------------------------------
Apartment Investment and Management Company was contacted by
lawyers who indicated that they might file a class action lawsuit
relating to mergers completed by the Company in early 2011,
according to the Company's April 29, 2011, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
March 31, 2011.
In connection with the Company's acquisitions of interests in real
estate partnerships, it is sometimes subject to legal actions,
including allegations that such activities may involve breaches of
fiduciary duties to the partners of such real estate partnerships
or violations of the relevant partnership agreements. The Company
may incur costs in connection with the defense or settlement of
such litigation. The Company believes that it complies with its
fiduciary obligations and relevant partnership agreements. During
the three months ended March 31, 2011, the Company was contacted
by attorneys who indicated that they intended to file a class
action lawsuit against it alleging breach of fiduciary duty and
other claims with respect to mergers completed earlier in 2011 in
which the Company acquired the remaining noncontrolling interests
in six consolidated real estate partnerships. Although the outcome
of any litigation is uncertain, the Company does not expect any
such legal actions to have a material adverse effect on its
consolidated financial condition, results of operations or cash
flows.
Headquartered in Denver and incorporated in 1994, Apart Investment
& Management Company, aka Aimco is an equity REIT that is engaged
in the acquisition, ownership, management and redevelopment of
both conventional and affordable apartment properties. In
addition, Aimco has an investment management platform that
provides services such as portfolio strategy, tax credit
syndication, acquisitions, dispositions and other transactional
services for which the company earns fees. As of June 30, 2010,
Aimco had $10.5 billion in undepreciated book assets and a total
market capitalization of $8.6 billion. Approximately 88% of
Aimco's net asset value is invested inconventional properties,
while 12% is invested in affordable properties.
APPLE INC: Illinois Resident Files Class Action Over iOS
--------------------------------------------------------
Steve Korris, writing for The Madison St. Clair Record, reports
that nine days after British Broadcasting Corporation reported
that Apple Inc. could stalk owners of iPhones with the iOS 4
operating system, Illinois resident Cynthia O'Flaherty proposed a
statewide class action against Apple in U.S. district court.
Her lawyer, Christian Montroy, Esq., of East St. Louis, sued Apple
on April 29, seeking damages under computer tampering and consumer
protection laws of Illinois.
"The accessibility of unencrypted information collected by Apple
places users at serious risk of privacy invasions, including
stalking," Mr. Montroy wrote.
The same sentence appeared in a nationwide class action complaint
that lawyer Aaron Mayer, Esq., of Charleston, S.C., filed at
federal court in Tampa, Fla., on April 22.
BBC had broken the story on April 20.
Mr. Mayer, representing clients from Florida and New York, sought
damages for privacy invasion and an injunction requiring Apple to
disable its tracking capabilities.
He wrote that 59 million people have iPhones, and many of them run
the iOS 4 system.
He proposed a separate class for purchasers of the 3G version of
iPad.
"Apple's iPhones and iPad 3Gs are carried with users to
essentially every location they travel to, making the information
collected by Apple highly personal; indeed, in many instances it
may be information to which employers and spouses are not privy,"
Mr. Mayer wrote.
"Plaintiffs and proposed class members were harmed by Apple's
accrual of personal location, movement and travel histories
because their personal computers were used in ways they did not
approve and because they were personally tracked just as if by a
tracking device for which a court ordered warrant would ordinarily
be required."
A week later, both sentences appeared in Mr. Montroy's complaint.
He identified Ms. O'Flaherty as a resident of the Southern
District of Illinois.
He wrote that Apple's terms of service didn't disclose that it
comprehensively tracked users.
"Apple collected the private location information covertly,
surreptitiously and in violation of law," Mr. Montroy wrote.
He wrote that "secretly gathered private information may be
subpoenaed and become public in the course of litigation,
including divorce proceedings."
"Plaintiff and her proposed classes face the risk of their private
location information being obtained by malicious third parties and
made public, for example, in the course of litigation," he wrote.
He wrote that Illinois computer tampering law provides for civil
and criminal actions.
"Violation of this law is a class four felony for the first
offense and a class three felony for the second or subsequent
offense," he wrote.
Though he described drastic damage, he argued for a class action
because "the amount of damages suffered individually by each
member of the class is so small as to make suit for its recovery
by each individual member of the class economically unfeasible."
BANCOLOMBIA SA: Appeal of Ruling in "Girona" Suit Still Pending
----------------------------------------------------------------
Bancolombia S.A's appeal from the disapproval of its agreement to
settle the lawsuit commenced by Maria del Rosario Escobar Girona
remains pending, according to the Company's April 28, 2011, Form
20-F filing with the U.S. Securities and Exchange Commission for
the year ended December 31, 2010.
The suit Maria del Rosario Escobar Girona vs Bancolombia S.A. and
la Defensoria del Pueblo is based on an alleged infringement of
collective rights and interests relating to administrative
morality and the defense of public finances, as a result of the
alleged failure to pay on the part of the Bank the amount ruled on
a class action suit filed by Luis Alberto Duran.
On September 10, 2009, the Administrative Court No. 42 of Bogota
-- Fourth Section held a public interest conciliation hearing in
connection with the case.
The plaintiff alleged breach by the Bank of collective rights and
interests regarding administrative morality and the defense of
public property in connection with its failure to pay amounts due
under certain arbitral proceedings.
The defendants were notified and the Bank on October 23, 2009,
responded to the lawsuit. On February 18, 2010, the public
interest conciliation hearing was declared failed.
On March 11, 2010, discovery was opened.
A conflict of jurisdiction was presented in September 2010, in
connection with the consideration of the Administrative Court No.
42 of Bogota arguing its incompetence to process of this
Constitutional action. This conflict of Jurisdiction was resolved
by the Tribunal Administrativo de Cundinamarca on decision dated
September 23, 2010, according to which the Administrative Court
No. 42 of Bogota must process this Constitutional action.
On February 10, 2011, The Administrative Court No. 42 of Bogota
held a new public interest conciliation hearing in connection with
the aforementioned case.
On February 10, 2011, was celebrated a new public interest
conciliation hearing, in which was presented a project of
agreement approved by the plaintiff, la Defensoria del Pueblo and
the General Attorney's office.
On February 22, 2011, the judge did not approve the agreement
presented by the plaintiff, la Defensoria del Pueblo and the
General Attorney's office on February 10.
On February 28, 2011, the Bank and la Defensoria del Pueblo
presented an appeal (recurso de reposicion y subsidiariamente de
apelacion) against the decision made by judge on February 22,
2011.
BANCOLOMBIA SA: Plaintiffs Appeal Property Damage Claims Denial
---------------------------------------------------------------
Plaintiffs appeal from the rejection of their claims in the class
action lawsuit alleging property damage, according to Bancolombia
S.A's April 28, 2011, Form 20-F filing with the U.S. Securities
and Exchange Commission for the year ended December 31, 2010.
With regard to the Santa Sofia Trust, a class action suit was
filed by the owners of the Santa Sofia Condominium against Bogota
City Hall, in which a claim was made against Fiducolombia S.A.
(currently Fiduciaria Bancolombia S.A.) and others alleging damage
to their property due to flaws with the terrain, and alleging that
no building permit should have been granted. A ruling in the
first instance rejected these claims and the plaintiffs lodged the
corresponding appeal, which is currently underway.
The Company says this contingency is possible.
BED BATH: Removes "Bennett" Song-Beverly Suit to N.D. Calif.
------------------------------------------------------------
Shelby Bennett, on behalf of herself and others similarly situated
v. Bed Bath & Beyond, Inc., et al., Case No. CGC-11-509031 (Calif.
Super. Ct., San Francisco Cty.), was filed on March 4, 2011. The
plaintiff alleges that BBB violated California's Song-Beverly
Credit Card Act, California Civil Code Section 1747.08.
California Civil Code Section 1747.08 generally states that when a
merchant is engaged in a retail transaction with a customer, the
merchant may neither (1) request personal identification
information from a customer paying for goods with a credit card,
and then record that personal identification information upon the
credit card transaction or otherwise; nor (2) require as a
condition of payment the cardholder to provide the customer's
personal identification information which the retailer causes to
be written, or otherwise records upon the credit card transaction
or otherwise.
Plaintiff is a resident of California. BBB is a New York
corporation with its principal place of business in
the State of New Jersey.
On the basis of diversity jurisdiction, BBB, on May 6, 2011,
removed the lawsuit to the Northern District of California, and
the Clerk assigned Case No. 11-cv-022220 to the proceeding.
Bed Bath and Beyond, Inc., is represented by:
David F. McDowell, Esq.
Purvi G. Patel, Esq.
MORRISON & FOERSTER LLP
555 West Fifth Street, Suite 3500
Los Angeles, CA 90013
Telephone: (213) 892-5200
E-mail: DMcDowell@mofo.com
PPatel@mofo.com
BLACK & DECKER: 2nd Circuit Revives Overtime Class Action
---------------------------------------------------------
Reuben Kramer at Courthouse News Service reports that the United
States Court of Appeals for the Second Circuit revived a class
action that claims hardware honcho Black & Decker failed to pay
its employees overtime.
Though the three-judge panel said that lead plaintiff Greg Kuebel
has a triable claim in the overtime issue, it affirmed a lower
court's decision that Mr. Kuebel can not seek compensation for his
commute to and from Home Depots that stock Black & Decker
products.
As a retail specialist for Black & Decker, Mr. Kuebel was supposed
to oversee product merchandising and marketing at Home Depots in
his assigned territory.
He was fired after about nine months on the job because his bosses
discovered Mr. Kuebel had been falsifying his timesheets.
In his labor action against the company, however, Mr. Kuebel
claimed that he had to falsify his timesheets because his
supervisors forbade him from working more than 40 hours a week,
yet expected him to put in the extra hours.
"Viewing the record in the light most favorable to Kuebel, B&D was
aware that Retail Specialists' responsibilities would push them
very close to, if not over, the forty-hour threshold, and three of
Kuebel's managers conveyed to him that he should do what it takes
to finish the job, but not record any overtime," Judge Barrington
Parker wrote for the appellate court's three-judge panel.
A federal judge had previously dismissed this claim, finding that
Mr. Kuebel was unable to specify the amount of unpaid overtime
work he completed and was imprecise with respect to damages.
Employers, however, are responsible for maintaining accurate
records of the hours that their employees work, the federal
appeals court found.
"Once an employer knows or has reason to know that an employee is
working overtime, it cannot deny compensation simply because the
employee failed to properly record or claim his overtime hours,"
Judge Parker wrote.
Mr. Kuebel says his supervisors specifically told him not to
record overtime hours.
"At least where the employee's falsifications were carried out at
the instruction of the employer or the employer's agents, the
employer cannot be exonerated by the fact that the employee
physically entered the erroneous hours into the timesheets," the
ruling states. "As the district court emphasized, Kuebel admits
that it was he who falsified his timesheets . . . . But his
testimony -- which must be credited at the summary judgement [sic]
stage -- was that he did so because his managers instructed him
not to record more than forty hours per week."
To prevail on his overtime claim, Mr. Kuebel must show that Black
& Decker knew he was working off the clock.
"The district court discounted Kuebel's testimony [that he
complained to a supervisor about not being paid for overtime],
relying on the fact that he never lodged a formal complaint using
B&D's anonymous reporting hotline," according to the ruling. "But
while that fact might conceivably hurt Kuebel's credibility at
trial, it does not warrant summary judgment for B&D."
As to Mr. Kuebel's commute claims, Black & Decker said it relied
upon Department of Labor guidelines in adopting a policy of paying
the specialists for travel time that exceeded one hour during the
morning commute and an hour during the evening commute.
Mr. Kuebel argued that he deserved compensation for all his
commuting time because, he said, his workday began and ended at
home, when he spent 15 to 30 minutes tackling administrative tasks
in the morning before hitting the road, and then 15 to 30 minutes
doing the same at the end of the day.
The appellate judges rejected this argument.
"Even if Kuebel's at-home activities were integral and
indispensable to his principal activities, they do not render the
entirety of his commute time compensable under the FLSA," Judge
Parker wrote, using the acronym for the Fair Labor Standards Act.
"The fact that Kuebel performs some administrative tasks at home,
on his own schedule, does not make his commute time compensable
any more than it makes his sleep time or his dinner time
compensable," Judge Parker continued, adding that "on his own
schedule" is the operative term in this case.
The judges noted legal precedent holding that even if a worker
performs a critical employment responsibility after completing the
evening commute, the performance of the "principal activity" does
not extend the workday and render the evening commute compensable,
as the worker is afforded flexibility in deciding when to complete
the post-commute tasks at hand.
"Indeed, there is nothing in the record to suggest that a Retail
Specialist could not, for example, wake up early, check his email,
synch his PDA, print a sales report, and then go to the gym, or
take his kids to school, before driving to his first Home Depot
store of the day; nor was Kuebel prevented from leaving his last
store of the day and going straight to a restaurant for dinner, or
waiting until late at night to synch his PDA (as electronic
records show he sometimes did)," according to the 26-page opinion.
A copy of the decision in Kuebel v. Black & Decker Inc., No. 10-
2273-cv (2nd Cir.), is available at http://is.gd/c9RJ7X
BORDERS GROUP: Continues to Defend Employee Suit in California
--------------------------------------------------------------
Borders Group, Inc., continues to defend itself against a
purported class action suit filed by former employees in
California, according to the Company's April 29, 2011, Form 10-K
filing with the U.S. Securities and Exchange Commission for the
year ended January 29, 2011.
In February 2009, three former employees, individually and on
behalf of a purported class consisting of all current and former
employees who work or worked as General Managers in Borders stores
in the State of California at any time from February 19, 2005
through February 19, 2009, have filed an action against the
Company in the Superior Court of California for the County of
Orange. The Complaint alleges, among other things, that the
individual plaintiffs and the purported class members were
improperly classified as exempt employees and that the Company
violated the California Labor Code by failing to (i) pay required
overtime and (ii) provide meal periods and rest periods, and (iii)
that those practices also violate the California Business and
Professions Code. The relief sought includes damages, restitution,
penalties, injunctive relief, interest, costs, and attorneys' fees
and such other relief as the court deems proper. The case is in
the early stages of discovery, and no trial date is scheduled. The
court has not ruled on any of the allegations, or decided whether
the case may proceed as a class action. The Company has not
included any liability in its consolidated financial statements in
connection with this matter and has expensed as incurred all legal
costs to date. The Company cannot reasonably estimate the amount
or range of possible loss, if any, at this time.
About Borders Group
Borders Group is a leading operator of book, music and movie
superstores and mall-based bookstores. At Jan. 29, 2011, the
Debtors operated 642 stores, under the Borders, Waldenbooks,
Borders Express and Borders Outlet names, as well as Borders-
branded airport stores in the United States, of which 639 stores
are located in the United States and 3 in Puerto Rico. Two of
Borders' flagship stores (along with other less prominent stores)
are located in Manhattan. In addition, the Debtors operate a
proprietary e-commerce Web site, http://www.Borders.com/,
launched in May 2008, which includes both in-store and online e-
commerce components. As of Feb. 11, 2011, Borders employed a
total of 6,100 full-time employees, 11,400 part-time employees,
and approximately 600 contingent employees.
CHEMED CORPORATION: Continues to Defend Wage Suit in New York
-------------------------------------------------------------
Chemed Corporation continues to defend itself against a class
action lawsuit pending in New York alleging violations of labor
laws, according to the Company's April 29, 2011, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarterly
period ended March 31, 2011.
On March 1, 2010, Anthony Morangelli and Frank Ercole filed a
class action lawsuit in federal district court for the Eastern
District of New York seeking unpaid minimum wages and overtime
service technician compensation from Roto-Rooter and Chemed. They
also seek payment of penalties, interest and plaintiffs' attorney
fees. The Company contests these allegations. In September 2010,
the Court conditionally certified a nationwide class of service
technicians, excluding those who signed dispute resolution
agreements in which they agreed to arbitrate claims arising out of
their employment. There has been no final determination of the
merits of collective treatment of the case. The Company is unable
to estimate its potential liability, if any, with respect to the
case.
CHEMED CORPORATION: Continues to Defend Wage Suit in California
---------------------------------------------------------------
Chemed Corporation's VITAS segment is party to a class action
lawsuit filed in the Superior Court of California, Los Angeles
County, in September 2006, by Bernadette Santos, Keith Knoche and
Joyce White. This case alleges failure to pay overtime and
failure to provide meal and rest periods to a purported class of
California admissions nurses, chaplains and sales representatives.
The case seeks payment of penalties, interest and Plaintiffs'
attorney fees. VITAS contests these allegations. In December
2009, the trial court denied Plaintiffs' motion for class
certification. This decision is currently under appeal. The
Company is unable to estimate its potential liability, if any,
with respect to the case.
No further updates were reported in Chemed Corporation's
April 29, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarterly period ended March 31, 2011.
CYBERDEFENDER CORP: Sued for Engaging in Deceptive Advertising
--------------------------------------------------------------
Joseph Thurman, et al., individually and on behalf of others
similarly situated individuals, Case No. 2011-CH-16779 v.
CyberDefender Corporation (Ill. Cir. Ct., Cook Cty. May 6, 2011),
is filed on behalf of all persons who purchased a CyberDefender
product or service and who were deceived into purchasing
defendant's products and services that did not perform as
advertised.
Defendant's conduct, as alleged, constitutes a breach of express
warranties pursuant to the California Commercial Code, and
violations of the Beverly Consumer Warranty Act, California's
Unfair Competition Law, California's False Advertising Law, and
California's Consumers Legal Remedies Act. Mr. Thurman adds that
that defendant also acted negligently in implementing its refund
policies.
Plaintiff Joseph Thurmnan is a resident of Chicago, Illinois.
Defendant is a Delaware corporation headquartered in Los Angeles
County, California, at 617 West 7th Street, Los Angeles,
California. CyberDefender is publicly traded on the NASDAQ and
has over 300 employees. CyberDefender sells a variety of software
products, including various editions of Registry Cleaner ("RC")
and Early Detection Center ("EDC"), which are sometimes marketed
under brand names.
Plaintiff relates that in January of 2011, he visited a site owned
and operated by defendant. At that time, Mr. Thurman performed a
scan on his PC offered on defendant's website. The scan offered
by defendant indicated that errors were located on his PC and that
these errors could negatively affect that performance of Mr.
Thurman's computer. The website informed Mr. Thurman that he
could purchase products sold by defendant to remove these errors.
Since downloading defendant's software onto his PC, Mr. Thurman
has experienced problems with his computer and has not noticed any
improvements to his PC's performance.
The Plaintiff is represented by:
Jay Edelson, Esq.
William C. Gray, Esq.
Ari J. Scharg, Esq.
EDELSON MCGUIRE, LLC
350 North LaSalle Street, Suite 1300
Chicago, IL 60654
Telephone: (312) 589-6370
E-mail: jedelson@edelson.com
wgray@edelson.com
ascharg@edelson.com
DEAN FOODS: July 18 Hearing Set for Class Action Settlement
-----------------------------------------------------------
Barbara Leonard at Courthouse News Service reports that Dean
Foods, a giant in the dairy industry, will pay $30 million to
settle claims that it reaped hundreds of millions of dollars in
profits while driving small farms out of business, according to an
agreement approved by a federal judge.
The farmers say that it "is the largest, reported antitrust
settlement in the history of the District of Vermont," according
to the ruling.
Dairy farmers sued Dean and the Dairy Farmers of America in 2009,
claiming they had engaged in anticompetitive conduct to corner the
northeast milk market, fix prices and shutter bottling plants.
After Sen. Bernie Sanders, D-Vt., said the conspiracy cost
taxpayers nationwide, Congress approved a bill requesting $350
million in aid for dairy farms.
"Pursuant to the settlement, Dean admits no wrongdoing and
plaintiffs agree, on behalf of the proposed settlement class, that
once the Dean Settlement Agreement becomes final, their claims
against Dean will be released," Chief U.S. District Judge
Christina Reiss wrote on May 4.
She said she would grant preliminary approval of the settlement
because "Plaintiffs and Dean represent that the Dean Settlement
was reached after vigorous, arm's-length negotiations between
highly experienced counsel."
After Judge Reiss heard a hearing on the settlement in April, the
parties met and modified an earlier settlement they had proposed
four months earlier. The new settlement eliminates the injunctive
relief that farmers had demanded because Dean plans "to alter its
business practices with or without the injunctive relief,"
according to the 18-page decision.
That provision had "been the sole source of objections to the Dean
Settlement," Judge Reiss wrote. Since the change moots this
objection, the judge refused to let various farmers intervene in
the preliminary approval process.
Judge Reiss also certified the proposed settlement class, noting
that the parties had clarified previous ambiguity she had
identified.
Excluding Dean officers and directors, the new settlement class
will include "all dairy farmers, whether individuals, entities or
members of cooperatives, who produced raw Grade A milk in Order 1
and pooled raw Grade A milk in Order 1 during any time from
January 1, 2002 to the Notice Date."
Judge Reiss said the parties will also provide additional
financial information in their proposed notices to settlement
class members.
This will enable "class members to better evaluate their
individual recoveries as a result of the Dean Settlement based
upon a sliding scale of potential attorney's fees awards,"
according to the ruling.
Judge Reiss also refused to let farmers and a dairy organization
from Maine intervene in the case, this late in the proceedings.
"The court therefore certifies the class for purposes of the Dean
Settlement only," Judge Reiss wrote. "Certification of the
settlement class will be considered further at the court's
fairness hearing."
That hearing is scheduled for July 18.
A copy of the Opinion and Order Granting Preliminary Approval of
Revised Dean Settlement and Denying Motions to Intervene in Allen,
et al. v. Dairy Farmers of America, Inc., et al., Case No. 09-cv-
00230 (D. Vt.), is available at:
http://www.courthousenews.com/2011/05/06/milk.pdf
DIRECTBUY: Public Citizen Opposes Class Action Settlement
---------------------------------------------------------
Public Citizen will argue on behalf of a class member that a
proposed settlement of a class action brought against membership-
buying service DirectBuy for misrepresenting that members could
buy products at cost is not fair, adequate and reasonable, and
that a court should not approve it.
DirectBuy is an Indiana-based company that markets itself as
providing its members the opportunity to buy "direct" from
manufacturers without hidden fees or markups. The class-action
lawsuit alleges that DirectBuy accepts rebates and discounts from
manufacturers without passing the savings on to members. Other
cases against DirectBuy that also would be resolved if the
settlement is approved challenge DirectBuy's high-pressure sales
tactics that induce consumers to purchase DirectBuy memberships
for as much as $7,000 in some states. Many DirectBuy members are
dissatisfied with the service because of the prices and selection
that DirectBuy offers and the fees that it charges, which
sometimes result in no or minimal savings compared to the prices
offered by traditional retailers.
Under the proposed settlement, the class of more than 836,000
consumers would release its claims in exchange for an extended
DirectBuy membership period. But nearly half of the class members
would receive nothing at all because they are former Direct
members who did not register for the extension. Even for current
DirectBuy members or former members who did register, the
settlement is essentially a coupon with little value, Public
Citizen attorney Michael Kirkpatrick, Esq., will argue. Class
members would need to pay additional fees to purchase anything.
The settlement also would release DirectBuy from liability for all
wrongdoing with respect to the purchase and use of DirectBuy
memberships before the date of the settlement, even for events not
yet known to class members. These terms were reached by offering
some class representatives financial incentives -- which could
have coaxed them into settling for too little.
The proposed settlement is subject to a higher level of scrutiny
because it was reached before class certification and because it
provides no monetary or injunctive relief for the class. The
court should deny final approval of the settlement because it
fails to benefit the class, Mr. Kirkpatrick will argue.
DPL INC: Faces Three Merger-Related Class Suits
-----------------------------------------------
DPL, Inc., is facing three class action lawsuits related to its
merger agreement with The AES Corporation, according to the
Company's April 29, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarterly period ended
March 31, 2011.
On April 19, 2011, DPL and The AES Corporation entered into an
Agreement and Plan of Merger whereby AES will acquire DPL for
$30.00 per share in a cash transaction valued at approximately
$3.5 billion plus the assumption of $1.2 billion of debt and
preferred stock. Upon closing, DPL will become a wholly owned
subsidiary of AES. The transaction has been unanimously approved
by each of DPL's and AES' board of directors, but is subject to
certain conditions, including receipt of the approval of DPL
shareholders and, the expiration or termination of the applicable
Hart-Scott-Rodino Act waiting period and the receipt of all
required regulatory approvals from, among others, the FERC and the
PUCO. The parties anticipate receiving approvals and closing the
transaction during the next six to nine months.
Three lawsuits have been filed in connection with the proposed
Merger of DPL and AES that was publicly announced on April 20,
2011. Each of these lawsuits seeks, among other things, one or
more of the following: to enjoin the defendants from consummating
the proposed Merger until certain conditions are met, or to
rescind the Merger, or to recover damages if the Merger is
completed or to commence a sale process and/or obtain an
alternative transaction or to promptly notice an annual
shareholder meeting or to recover an unspecified amount of other
damages and costs, including attorneys' fees and expenses.
On April 21, 2011, a lawsuit was filed in the Court of Common
Pleas of Montgomery County, Ohio, naming DPL and each member of
DPL's board of directors, AES and Dolphin Sub, Inc., as
defendants. The lawsuit is a purported class action filed by
Patricia A. Heinmuller on behalf of herself and an alleged class
of DPL shareholders. Plaintiff alleges, among other things, that
DPL's directors breached their fiduciary duties in approving the
proposed Merger of DPL and AES and that AES and Dolphin Sub, Inc.,
aided and abetted such breach.
On April 25, 2011, a lawsuit was filed in the Court of Common
Pleas of Montgomery County, Ohio, naming DPL and each member of
DPL's board of directors and AES as defendants. The lawsuit is a
purported class action and purported derivative action (on behalf
of DPL) filed by The Austen Trust on behalf of itself and an
alleged class of DPL shareholders and derivatively on behalf of
DPL. Plaintiff alleges, among other things, that DPL's directors
breached their fiduciary duties in approving the proposed Merger
of DPL and AES and that the defendants acted in concert in respect
of the breach of their respective duties.
On April 26, 2011, a lawsuit was filed in the United States
District Court, Southern District, Western Division, naming DPL
and each member of DPL's board of directors, AES and Dolphin Sub,
Inc. as defendants. The lawsuit is a purported class action and
purported derivative action (on behalf of DPL) filed by Stephen
Kubiak on behalf of himself and an alleged class of DPL
shareholders and derivatively on behalf of DPL. Plaintiff
alleges, among other things, that DPL's directors breached their
fiduciary duties in approving the proposed Merger of DPL and that
AES and Dolphin Sub, Inc., aided and abetted such breach.
A number of other similar putative class action lawsuits may be
filed in federal or state court in Ohio by purported shareholders
of DPL on behalf of themselves and other shareholders of DPL.
Such complaints may name as defendants DPL and its directors and,
in certain cases, AES and Dolphin Sub, Inc.
The complaints may allege, among other things, that DPL's
directors breached their fiduciary duties to shareholders of DPL
in connection with DPL's entry into the proposed Merger with AES
and that AES and Dolphin Sub, Inc., aided and abetted the
directors' purported breaches of fiduciary duties. The complaints
may seek, among other things, class action status, an order
enjoining the proposed transaction, and attorneys' fees and
expenses.
DPL intends to vigorously defend against all of these claims.
DYNAMICS RESEARCH: Ready to Carry Out Terms of Class Settlement
---------------------------------------------------------------
Dynamics Research Corporation is ready to execute the terms of a
settlement it negotiated in a Massachusetts employee class action
lawsuit, the Company disclosed in its April 29, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2011.
On June 28, 2005, a class action employee suit was filed in the
U.S. District Court for the District of Massachusetts alleging
violations of the Fair Labor Standards Act and certain provisions
of Massachusetts General Laws. In July 2010, the Company and the
plaintiffs agreed upon principle terms of settlement, the cost of
which was accrued on the balance sheet as of June 30, 2010. In
October 2010, the Company received an executed settlement
agreement by the plaintiffs. The Federal District Court for the
First Circuit reviewed the settlement and on March 4, 2011,
approved the settlement. The Federal Court's 30-day appeal period
for challenges to the settlement expired on April 4, 2011, with no
appeals filed. The parties will proceed to implement the terms of
the class action settlement.
Dynamics Research, headquartered in Andover, Massachusetts, is a
leading provider of innovative management consulting, engineering,
and information technology services and solutions to federal and
state governments. It delivers high-value differentiated
solutions to its clients. The Company's five areas of
differentiated expertise are business transformation, information
technology, training and performance support, management services
and engineering services.
EAGLE EXPRESS: Sued for Unpaid Overtime Wages
---------------------------------------------
Stephen Fossler, on behalf of himself and others similarly
situated v. Eagle Express Lines, Inc., Case No. 2011-CH-16741
(Ill. Cir. Ct., Cook Cty. May 6, 2011), brings this class action
for unpaid overtime, monetary damages, liquidated damages,
declaratory and injunctive relief and other equitable and
ancillary relief pursuant to the Illinois Wage Payment and
Collection Act, 820 ILCS Section 1l5, et seq.
Plaintiff Stephen Fossler, a resident of Aurora, Illinois, is
employed as a tractor trailer driver working out of the
defendant's Fox Valley, Illinois facility picking up and
delivering mail for the United States Post Office.
Eagle Express is a full service contract carrier that operates as
a third party carrier for the United States Post Office and other
privately owned companies throughout the United States.
Plaintiff says Eagle Express intentionally, willfully and
improperly failed to pay them the overtime wages to which they
were entitled. Defendant also intentionally, willfully, and
improperly failed to pay plaintiff for all hours worked. For
example, for the pay period of March 3, 2011, to March 19, 2011,
plaintiff worked 110.45 hours but was only paid for 94.8 hours.
The Plaintiff is represented by:
Vincent DiTommaso, Esq.
Peter Lubin, Esq.
DITOMMASO-LUBIN P.C.
The Oak Brook Terrace Atrium
17W220 22d Street, Suite 200
Oak Brook Terrace, IL 60181
Telephone: (630) 333-0000
E-mail: psl@ditommasolaw.com
vdt@ditommasolaw.com
- and -
Paul G. Krentz, Esq.
KINALLY FLAHERTY KRENTZ & LORAN PC
2114 Deerpath Road
Aurora, IL 60506
Telephone: (630) 907-0909
E-mail: pkrentz@kfkllaw.com
- and -
Terrence Buehler,Esq.
TOUHY, TOUHY & BUEHLER LLP
55 West Wacker Drive, 14th Floor
Chicago, IL 60601
Telephone: (312) 372-2209
ELECTRONIC ARTS: Rejects Some Conspiracy Claims in Class Action
---------------------------------------------------------------
Courthouse News Service reports that Electronic Arts can dismiss
claims from a civil class action that accuses it of duping college
athletes into signing away their rights to profit from their own
images, a federal judge ruled. But Collegiate Licensing Company
and the National Collegiate Athletic Association cannot do the
same.
In addition to granting relief only to Electronic Arts, the ruling
also pertains only to the certain antitrust allegations originally
filed by eight former college basketball players and four former
college football players.
That suit was consolidated earlier with a publicity-rights
complaint filed by four former college football players.
EA claims the plaintiffs do not have enough evidence to plead that
it engaged in an antitrust conspiracy with the Indiana-based NCAA
and or the Georgia-based College Licensing Company (CLC).
The plaintiffs had claimed that the NCAA has college athletes to
sign release forms, and CLC then executes these license agreements
with companies like EA, which then profit off the athletes'
images, likenesses and names in video games and other products.
EA says there is no basis to suggest it joined in the conspiracies
that the plaintiffs allege. One claim states that the defendants
conspired to pay athletes $0 for their images, likenesses or
names.
U.S. District Judge Claudia Wilken agreed on May 2 that the
lawsuit does not plead facts suggesting that EA joined the
conspiracy.
"Antitrust Plaintiffs note that EA entered into license agreements
with CLC that did not compensate them and putative class members
for the use of their likenesses," Judge Wilken wrote. "However,
Antitrust Plaintiffs disavow use of these agreements to show the
price-fixing conspiracy, stating that, while EA's license
agreements furthered the conspiracy, the 'agreements are obviously
not the agreement among Defendants to participate in this unlawful
and anticompetitive scheme.' Antitrust Plaintiffs do not identify
any other agreement to which EA was a party that relates to the
alleged price-fixing scheme."
"Lacking factual allegations of an agreement, Antitrust
Plaintiffs' . . . claim against EA based on an alleged price-
fixing conspiracy must be dismissed," the 17-page ruling states.
Judge Wilken also dismissed the claim that EA conspired to "group
boycott" athletes to deny them compensation for the use of their
images, likenesses or names.
She noted that the consolidated amended complaint fails to allege
that EA helped require student athletes to sign annual forms
requiring them to relinquish all rights in perpetuity for use of
or compensation for their images, likenesses or names.
Judge Wilken also dismissed the athletes' common-law claims as
tied to the federal conspiracy claims.
CLC tried to dismiss the same claims as well as civil-conspiracy
claims alleged by the publicity-rights complaint. NCAA requested
the same relief, as well as to dismiss the breach-of-contract
claim in the publicity-rights complaint.
Judge Wilken shot down both motions.
The United States Court of Appeals for the Ninth Circuit is
currently weighing EA's motion to strike under California's anti-
SLAPP (Strategic Lawsuit Against Public Participation) law.
Judge Wilken rejected the motion last year but stayed the action
in December.
Though the anti-SLAPP claims were only filed in connection to the
lawsuit brought by former Arizona State quarterback Samuel Keller,
Judge Wilken said she used her discretion to stay proceedings and
discovery against EA on other plaintiffs' claims that are
identical to those on appeal.
Mr. Keller filed his complaint, claiming EA conspired with the
NCAA and Collegiate Licensing to violate his right of publicity,
in May 2009. UCLA basketball star Edward O'Bannon filed his
complaint two months later, asserting antitrust claims against
NCAA and CLC. University of North Carolina football player Bryon
Bishop sued over misappropriation of image in September. All
three complaints were consolidated in January, and the plaintiffs
filed an amended complaint in March.
Judge Wilken refused to stay proceedings and discovery for the
NCAA and CLC.
A copy of the Order Granting EA's Motion to Dismiss and Denying
CLC's and NCAA's Motions to Dismiss in In Re NCAA Student-Athlete
Name & Likeness Litigation, Case No. 09-cv-01967 (N.D. Calif.), is
available at:
http://www.courthousenews.com/2011/05/06/ncaa.pdf
ELI LILLY: Bid for Review of "Zyprexa" Case Ruling Pending
----------------------------------------------------------
Plaintiffs' bid for a review of a circuit court decision in a
Zyprexa-related consumer lawsuit is pending in the Supreme Court,
according to Eli Lilly and Company's April 29, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2011.
Zyprexa, Eli Lilly's top-selling product, is a treatment for
schizophrenia, acute mixed or manic episodes associated with
bipolar I disorder, and bipolar maintenance.
In 2005, two lawsuits were filed in the Federal District Court for
the Eastern District of New York purporting to be nationwide class
actions on behalf of all consumers and third-party payors,
excluding governmental entities, which have made or will make
payments for their members or insured patients being prescribed
Zyprexa. The actions were consolidated into a single lawsuit,
brought under certain state consumer protection statutes, the
federal civil RICO statute, and common law theories, seeking a
refund of the cost of Zyprexa, treble damages, punitive damages,
and attorneys' fees. Two additional lawsuits were filed in the
EDNY in 2006 on similar grounds. The lawsuits allege that Eli
Lilly inadequately tested for and warned about side effects of
Zyprexa and improperly promoted the drug. In September 2008,
Judge Jack Weinstein certified a class consisting of third-party
payors, excluding governmental entities and individual consumers,
and denied the Company's motion for summary judgment. In
September 2010, both decisions were reversed by the Second Circuit
Court of Appeals, which found that the case cannot proceed as a
class action and entered a judgment in the Company's favor on
plaintiffs' overpricing claim. Plaintiffs are seeking review of
that decision by the U.S. Supreme Court.
The Company says an unfavorable outcome in the case could have a
material adverse impact on its consolidated results of operations,
liquidity, and financial position.
ENSCO PLC: Defends Shareholder Suits Over Merger with Pride Int'l.
------------------------------------------------------------------
Ensco PLC is currently defending itself against a number of
shareholder class actions over its merger plans with Pride
International, Inc., according to the Company's April 29, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ending March 31, 2011.
On February 6, 2011, Ensco plc entered into an Agreement and Plan
of Merger with Pride International, Inc., a Delaware corporation,
ENSCO International Incorporated, a Delaware corporation and a
wholly owned subsidiary and predecessor of Ensco, and ENSCO
Ventures LLC, a Delaware limited liability company and an
indirect, wholly owned subsidiary of Ensco. The Merger Sub will
merge with and into Pride, with Pride as the surviving entity and
an indirect, wholly owned subsidiary of Ensco. As a result of the
merger, each outstanding share of Pride's common stock will be
converted into the right to receive $15.60 in cash and 0.4778
Ensco American depositary shares, each representing one Class A
ordinary share. The total consideration to be delivered in the
merger is to be approximately $7.9 billion, consisting of $2.8
billion of cash, the delivery of approximately 86.0 million Ensco
ADSs with an aggregate value of $5.1 billion based on the closing
price of Ensco ADSs of $59.10 on April 25, 2011, and the estimated
fair value of $32.0 million of Pride employee stock options
assumed by Ensco. The closing of the merger is anticipated to
occur during the second quarter of 2011.
During the first quarter of 2011, six shareholder class action
lawsuits were brought on behalf of the holders of Pride common
stock against Pride, Pride's directors and Ensco challenging
Pride's proposed merger with Ensco. Plaintiffs generally allege
that each member of the Pride board of directors breached his or
her fiduciary duties to Pride and its stockholders by authorizing
the sale of Pride to Ensco for what plaintiffs deem "inadequate"
consideration, failure to disclose material information concerning
the proposed merger in the registration statement on Form S-4,
that Pride directly breached and/or aided and abetted the other
defendants' alleged breach of fiduciary duties and/or that Ensco
aided and abetted the alleged breach of fiduciary duties by Pride
and its directors. The lawsuits generally seek, among other
remedies, to enjoin the defendants from consummating the merger on
the agreed-upon terms.
The lawsuits include:
* On February 10, 2011, a lawsuit styled Saratoga Advantage
Trust vs. Pride International, Inc., et al., that was filed
in the Court of Chancery of the State of Delaware. This is a
purported shareholder class action brought on behalf of the
holders of Pride International, Inc., common stock against
Pride, Pride's directors and Ensco plc arising out of the
proposed sale of Pride to Ensco in a stock and cash
transaction valued at $41.60 per share of Pride common stock.
The lawsuit alleges that the proposed transaction undervalues
Pride's shares, that Pride and the individual (director)
defendants violated their fiduciary duties by approving the
proposed merger, failing to take steps to maximize value to
Pride's stockholders and failing to disclose material
information concerning the proposed merger in the
registration statement on Form S-4, and that Ensco aided and
abetted the breach of fiduciary duties. The lawsuit seeks
injunctive relief, a declaration of breach of fiduciary
duties, an order requiring the individual defendants to
properly exercise their fiduciary duties, and a declaration
that the proposed transaction is void or, if consummated,
ordering rescission, and attorneys' fees and costs.
* On February 11, 2011, substantially similar actions were
filed in the District Court of Harris County Texas styled
Abrams vs. Pride International, Inc., et al., and Astor BK
Realty Trust vs. Louis A. Raspino, et al. On February 17,
2011, a substantially similar action was filed in the Court
of Chancery of the State of Delaware styled Elizabeth Wiggs-
Jacques vs. Pride International, Inc., et al. These also are
purported shareholder class actions against Pride and its
individual directors, which name ENSCO International
Incorporated and ENSCO Ventures LLC as parties defendant.
* On March 2, 2011, and March 8, 2011, substantially similar
actions were filed in the Court of Chancery of the State of
Delaware and the United States District Court, Southern
District of Texas, Houston Division styled Barry S. Smith vs.
Pride International, Inc., et al., and Booth Family Trust vs.
Pride International, Inc., et al., respectively. These also
are purported shareholder class actions against Pride and its
individual directors, which name Ensco plc, ENSCO
International Incorporated and ENSCO Ventures LLC as parties
defendant.
Three of these actions recently were consolidated in Delaware and
the remaining three recently were consolidated in Texas.
The Company intends to vigorously defend against all of these
claims. At this time, the Company is unable to predict the
outcome of these matters or estimate the extent to which the
Company may be exposed to any resulting liability. Although the
outcome cannot be predicted, the Company does not expect these
matters to have a material adverse effect on its financial
position, operating results or cash flows.
GERON CORP: Calif. Court Orders Dismissal of Class Action Suit
---------------------------------------------------------------
A California district court dismissed a securities class action
complaint filed against Geron Corporation, according to the
Company's April 29, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarterly period ended
March 31, 2011.
On December 21, 2010, a purported securities class action
complaint was filed in the U.S. District Court for the Northern
District of California, naming the Company and one of its
executive officers as defendants. The lawsuit alleged that the
defendants made materially false or misleading public statements
regarding the Company's financial condition in violation of
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934,
as amended. The plaintiff sought to represent a class of
investors who purchased the Company's common stock between
July 30, 2010, and December 6, 2010, and sought damages,
attorney's fees and other relief. The case was voluntarily
dismissed, without prejudice, on February 14, 2011, which
dismissal was so ordered by the Court on February 15, 2011.
INTERNAP NETWORK: Awaits Ruling on Motion to Dismiss Fraud Suit
---------------------------------------------------------------
Internap Network Services Corporation is awaiting a court ruling
on its motion to dismiss a third amended class action complaint in
a putative securities fraud class action lawsuit, according to the
Company's April 28, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2011.
On November 12, 2008, a putative securities fraud class action
lawsuit was filed against the Company and its former chief
executive officer in the United States District Court for the
Northern District of Georgia, captioned Catherine Anastasio and
Stephen Anastasio v. Internap Network Services Corp. and James P.
DeBlasio, Civil Action No. 1:08-CV-3462-JOF. The complaint
alleges that the Company and the individual defendant violated
Section 10(b) of the Securities Exchange Act of 1934 and that the
individual defendant also violated Section 20(a) of the Exchange
Act as a "control person" of Internap. Plaintiffs purport to
bring these claims on behalf of a class of the Company's investors
who purchased the Company's common stock between March 28, 2007,
and March 18, 2008.
Plaintiffs allege generally that, during the putative class
period, the Company made misleading statements and omitted
material information regarding (a) integration of VitalStream,
which the Company acquired in 2007, (b) customer issues and
related credits due to services outages and (c) the Company's
previously reported 2007 revenue that the Company subsequently
reduced in 2008 as announced on March 18, 2008. Plaintiffs assert
that the Company and the individual defendant made these
misstatements and omissions to keep the Company's stock price
high. Plaintiffs seek unspecified damages and other relief.
On August 12, 2009, the Court granted plaintiffs leave to file an
Amended Class Action Complaint. The Amended Complaint added a
claim for violation of Section 14(a) of the Exchange Act based on
alleged misrepresentations in the Company's proxy statement in
connection with the Company's acquisition of VitalStream. The
Amended Complaint also added the Company's former chief financial
officer as a defendant and lengthened the putative class period.
On September 11, 2009, the Company and the individual defendants
filed motions to dismiss. On November 6, 2009, plaintiffs filed a
Corrected Amended Class Action Complaint. On December 7, 2009,
plaintiffs filed a motion for leave to file a Second Amended Class
Action Complaint to add allegations regarding, inter alia, an
alleged failure to conduct due diligence in connection with the
VitalStream acquisition and additional statements from purported
confidential witnesses.
On September 15, 2010, the Court granted the Company's motion to
dismiss and denied the individual defendants' motion to dismiss.
The Court dismissed plaintiffs' claims under Section 14(a) of the
Exchange Act. With respect to plaintiffs' claims under Section
10(b) of the Exchange Act, the Court held that the Amended
Complaint failed to satisfy the pleading requirements of the
Private Securities Litigation Reform Act, but allowed plaintiffs'
one final opportunity to amend the complaint. On October 26,
2010, plaintiffs filed their Third Amended Class Action Complaint.
On December 10, 2010, the Company filed a motion to dismiss this
complaint, which is currently pending before the Court.
JIMMY CARTER: Class Action Over Book on Palestine Withdrawn
-----------------------------------------------------------
Stephen Lowman, writing for The Washington Post, reports that a
class-action lawsuit targeting former President Jimmy Carter's
2006 book "Palestine: Peace Not Apartheid" and his publisher,
Simon & Schuster was withdrawn on May 5.
The suit, which was filed in February, alleged that Mr. Carter's
book promoted "anti-Israel propaganda" and contained numerous
"falsehoods and misrepresentations." The claimants sought at
least $5 million in compensation.
In their brief to the court, lawyers for Mr. Carter and his
publisher called the lawsuit "a transparent attempt at censorship
that is plainly prohibited by the First Amendment," adding:
"however the plaintiffs attempt to frame their claims, they seek
nothing more than to exact punishment because they disagree with
the contents of the book."
On May 5, after the defense filed their brief, lawyers for the
five persons named in the lawsuit against Mr. Carter voluntarily
dismissed their claim.
David Schoen, Esq., attorney for the plaintiffs, said in an e-mail
that the complaint was withdrawn from the federal court because of
"jurisdictional issues." He plans on refiling in state court
given the number of potential plaintiffs and the variety of places
"from which they come."
"I had hoped to be able to avoid a multiplication in litigation
and thought that we would find reasonable minds who could simply
acknowledge the factual errors as a matter of first course to open
a dialogue on resolving the litigation," Mr. Schoen wrote. "But
so it goes."
KINDER MORGAN: Awaits Final Hearing in Second Arbitration
---------------------------------------------------------
A final hearing in connection with the second arbitration filed
against a unit of Kinder Morgan Energy Partners, L.P. is set to be
held this year, according to the Company's April 29, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarterly period ended March 31, 2011.
Kinder Morgan CO2 and Cortez Pipeline Company were among the named
defendants in CO2 Committee, Inc. v. Shell Oil Co., et al., an
arbitration initiated on November 28, 2005. The arbitration arose
from a dispute over a class action settlement agreement which
became final on July 7, 2003, and disposed of five lawsuits
formerly pending in the U.S. District Court, District of Colorado.
The plaintiffs in such lawsuits primarily included overriding
royalty interest owners, royalty interest owners, and small share
working interest owners who alleged underpayment of royalties and
other payments on carbon dioxide produced from the McElmo Dome
unit.
The settlement imposed certain future obligations on the
defendants in the underlying litigation. The plaintiffs in the
arbitration alleged that, in calculating royalty and other
payments, defendants used a transportation expense in excess of
what is allowed by the settlement agreement, thereby causing
alleged underpayments of approximately $12 million. The
plaintiffs also alleged that Cortez Pipeline Company should have
used certain funds to further reduce its debt, which, in turn,
would have allegedly increased the value of royalty and other
payments by approximately $0.5 million. On August 7, 2006, the
arbitration panel issued its opinion finding that defendants did
not breach the settlement agreement. On June 21, 2007, the New
Mexico federal district court entered final judgment confirming
the August 7, 2006 arbitration decision.
On October 2, 2007, the plaintiffs initiated a second arbitration
(CO2 Committee, Inc. v. Shell CO2 Company, Ltd., aka Kinder Morgan
CO2 Company, L.P., et al.) against Cortez Pipeline Company, Kinder
Morgan CO2 and an ExxonMobil entity. The second arbitration
asserts claims similar to those asserted in the first arbitration.
A second arbitration panel has convened and a final hearing on the
parties' claims and defenses is expected to occur in 2011.
LEXISNEXIS RISK: Faces Class Action Over Employment Database
------------------------------------------------------------
Reuben Kramer at Courthouse News Service reports that in a federal
class action, low-wage retail workers claim LexisNexis Risk &
Information Analytics Group sabotaged their careers by
characterizing them as "thieves" in the national employment
database Esteem.
The database "helps organizations identify applicants with history
of theft or fraud," and some of the nation's largest retailers
subscribe, including Rite Aid, CVS, Target and Home Depot,
according to the complaint.
The class claims that LexisNexis has "a contractual quid pro quo"
arrangement whereby in exchange for database access to vet job
applicants, "Esteem subscribers are required to 'contribute' new
records of theft incidents involving their own employees or
customers."
Under Esteem's "Rules of Participation," terminations resulting
from "a company loss not strictly related to theft or fraud . . .
should not get reported," the complaint states.
But the class claims: "Defendant has not adopted any Rule of
Participation that further defines the kinds of incidents that
should be reported, nor has defendant issued any guidance or
directive to Esteem subscribers, or provided any training to
subscribers, designed to ensure that terminations for non-
fraudulent reasons or for violations of policies not strictly
related to theft or fraud are kept out of the Esteem database."
Included in an Esteem entry is an image of a purported "signed
admission statement" by the accused employee.
The problem, the plaintiffs say, is that LexisNexis doesn't
"impose on members any rules, procedures or criteria regarding
what constitutes an 'admission,' how admissions may be obtained,
the form of admission statements, or what, if anything, employees
signing an 'admission statement' must be informed of about Esteem
or the purpose of the statement."
The class adds: "And, where the statement refers to circumstances
that could be interpreted as something other than a theft,
defendant does not require the contributing member to furnish any
clarifying information and, instead, resolves all doubt in favor
of the contributing member."
LexisNexis styles the supposed admission a "verified admission
statement," but the company does not do its due diligence to
investigate or verify it, the class claims.
Named plaintiff Keesha Goode says that after she lost her job as a
cashier at a mall in October 2008, she applied for a position with
Family Dollar Stores, an Esteem subscriber, in May 2009.
She received a "Pre-Adverse Action Notice" supposedly from Family
Dollar Stores, claiming a background check had yielded information
on her that could hurt her chance for the job, Ms. Goode claims.
Ms. Goode says she sent a letter to the defendant's predecessor,
ChoicePoint WorkPlace Solutions, explaining that she "was accused
of not reporting on a former employee who was stealing
merchandise, but I did not steal anything myself." She also
"expressly requested 'a copy of all information about me that
[defendant] has regarding this report.'"
Ms. Goode says she never got the job with Family Dollar Stores,
and "still has not been provided a copy of the so-called
'admission statement' being maintained by defendant in its Esteem
system," which she has a right to dispute.
"The failure of defendant to provide consumers with the actual
'admission statement' forming the basis of the Esteem theft
reports is particularly egregious in that, by such failure,
defendant is systematically undermining the possibility of
meaningful consumer disputes by requiring consumers to dispute the
accuracy of 'admission statements' it does not let consumer see,"
according to the complaint.
Plaintiff Victoria Goodman says that while working as a cashier
and stocker for Dollar General, she was told she was the subject
of a theft investigation, and was told to leave work and to not
return until the investigation concluded.
As time passed with no word about the investigation, Ms. Goodman
applied for unemployment compensation -- an application that was
unopposed by Dollar General, she says.
"Had she, in fact, been discharged for committing a theft . . .
Dollar General would not have been liable for her unemployment
compensation," according to the complaint.
Ms. Goodman says she was approved for the benefits, and eventually
went to work as a cashier for Rite Aid, but after more than 3
years at that job, she was fired after she applied for a promotion
to supervisor.
"After she was fired, plaintiff received a computer-generated Pre-
Adverse Action Notice" telling her that a consumer report received
by Esteem subscriber Rite-Aid "may adversely affect your
employment status with Rite Aid Corporation," Ms. Goodman says.
She says the Fair Credit Reporting Act requires that such notices
be sent to people before adverse employment action is taken, not
after, as occurred with both plaintiffs.
When an employer makes an inquiry in Esteem about a job applicant,
the LexisNexis Risk & Information Analytics Group is prompted to
verify whether the applicant exists in the database, and then
"adjudicates" the inquiry, labeling the individual as a "non-
competitive" applicant if a match is found, the plaintiffs say.
That adjudication is "a critical step in an employment decision,"
and therefore LexisNexis "is itself taking adverse actions with
regards to employment applications before it mails out the
required Pre-Adverse Action Notice," according to the complaint.
Ms. Goodman says she was eventually reinstated at Rite Aid, but
that she faces "continuing impediments to future promotions or
hiring in so far as she is being classified as a thief in a
nationwide employment database."
The women demand statutory and punitive damages for the class,
under the Fair Credit Reporting Act.
A copy of the Complaint in Goode, et al. v. LexisNexis Risk &
Information Analytics Group, Inc., Case No. 11-cv-02950 (E.D.
Pa.), is available at:
http://www.courthousenews.com/2011/05/06/LexNex.pdf
The Plaintiffs are represented by:
Irv Ackelsberg, Esq.
Howard I. Langer, Esq.
John J. Grogan, Esq.
Edward A. Diver, Esq.
LANGER & GROGAN & DIVER, PC
1717 Arch Street, Suite 4130
Philadelphia, PA 19103
Telephone: (215) 320-5660
E-mail: iackelsberg@langergrogan.com
hlanger@langergrogan.com
jgrogan@langergrogan.com
ndiver@langergrogan.com
- and -
James A. Francis, Esq.
Mark D. Mailman, Esq.
FRANCIS & MAILMAN, PC
100 S. Broad Street, 19th Floor
Philadelphia, PA 19110
Telephone: (215) 735-8600
E-mail: jfrancis@consumerlawfirm.com
mmailman@consumerlawfirm.com
- and -
Sharon M. Dietrich, Esq.
Nadia Hewka, Esq.
COMMUNITY LEGAL SERVICES, INC.
1424 Chestnut Street
Philadelphia, PA 19102
Telephone: (215) 981-3700
- and -
Leonard A. Bennett, Esq.
CONSUMER LITIGATION ASSOCIATES, PC
12515 Warwick Boulevard #101
Newport News, VA 23606
Telephone: (757) 930-3660
MECOX LANE: Amended Consolidated Complaint to be Filed Soon
-----------------------------------------------------------
Mecox Lane Limited anticipates receiving an amended consolidated
complaint soon following a court order consolidating two class
action lawsuits related to the Company's initial public offering,
according to the Company's April 29, 2011, Form 20-F filing with
the U.S. Securities and Exchange Commission for the fiscal year
ended December 31, 2010.
On December 3, 2010, a class action complaint captioned Arfa v.
Mecox Lane Limited, et al., No. 10-CV-9053, was filed by the law
firm of Kahn Swick & Foti, LLC, on behalf of purchasers of the
Company's ordinary shares issued pursuant to its initial public
offering. The named defendants are the Company, certain
individual defendants by virtue of their positions as officers and
directors of the Company, namely Neil Nanpeng Shen, John J. Ying,
Paul Bang Zhang, Alfred Beichun Gu, Kelvin Kenling Yu, Anthony Yai
Yiu Lo and David Jian Sun, or the Individual Defendants, and two
underwriters involved in the initial public offering, Credit
Suisse Securities (USA) LLC and UBS AG. The plaintiff in the Arfa
action alleges that the defendants included or allowed to be
included materially false and misleading statements in the
registration statement and prospectus issued in connection with
the initial public offering in violation of Section 11 of the
Securities Act of 1933, and against the Individual Defendants
under Section 15 of the Securities Act. Specifically, the
plaintiff contends that the Company's registration statement and
prospectus for its initial public offering were materially false
and misleading because they failed to disclose at the time of the
initial public offering that: (i) it already was foreseeable that
the Company would not be able to achieve results for the third
quarter of 2010 that were in line with either historical growth
trends or defendants' guidance; (ii) the Company already had
experienced disappointing results for the third quarter of 2010,
prior to the initial public offering -- including a significant
decline in gross margins that were adversely impacted by increased
costs and expenses; (iii) defendants had not conducted an adequate
due diligence investigation into the company; and (iv) the Company
lacked adequate internal financial controls.
On January 4, 2011, a virtually identical class action complaint
captioned Brady v. Mecox Lane Limited, et al., No. 11-CIV-0034 was
filed by the law firm of Pomerantz Haudek Grossman & Gross LLP,
also in the Southern District of New York, on behalf of persons or
entities who purchased the Company's American Depositary Shares
pursuant and/or traceable to its October 2010 registration
statement and prospectus. The Brady complaint added Oppenheimer &
Co., Inc., and Roth Capital Partners LLC as additional underwriter
defendants, and added a claim under Section 12(a)(2) of the
Securities Act.
On March 31, 2011, the actions were consolidated by order of Judge
Robert Sweet. The Court appointed the Westend Group as lead
plaintiff, and Kahn Swick & Foti, LLC and Pomerantz Haudek
Grossman & Gross LLP as co-lead counsel. Pursuant to a scheduling
order, the lead plaintiff may file an amended, consolidated
complaint within sixty days of that order. The Company's response
will be due sixty days after the filing of that amended complaint.
The Company intends to continue defending against the class
action.
As of April 29, 2011, the Company is unable to form a judgment,
within the meaning and in accordance with the standards set forth
in the ABA Statement of Policy, as to the ultimate outcome of the
Class Action. The Company is also unable to give an estimate,
within the meaning and in accordance with the standards set forth
in the ABA Statement of Policy, of the amount or range of
potential loss, if any, which might result to the Company if the
outcome in the class action were unfavorable.
NETFLIX INC: Blockbuster Clients Excluded From Walmart Suit
-----------------------------------------------------------
Dan McCue at Courthouse News Service reports that a federal judge
in Oakland, Calif., dismissed two class actions -- extracting them
from an ongoing multidistrict litigation -- filed by former
Blockbuster subscribers who claim Netflix and Wal-Mart conspired
to monopolize DVD rental service.
U.S. District Judge Phyllis J. Hamilton said the Blockbuster
subscribers failed to prove that they paid inflated rates to rent
DVDs because of marketing agreement between Netflix and Wal-Mart.
Blockbuster is not a part to the complaint.
The actions are part of a larger multidistrict litigation in which
consumers say Netflix and Wal-Mart entered into a May 2005
marketing agreement to create a monopoly and unlawfully restrain
the trade in the market for online DVD rentals.
As a result of the agreement, the plaintiffs generally claim that
Wal-Mart exited the market and that Netflix was then able to
entrench and enhance its dominant market position in the online
DVD-rental market, ultimately raising its prices.
Where the tossed cases differ from those that remain is that the
Blockbuster subscribers claim these actions ultimately led them to
pay "supracompetitive" prices for online movies.
In December 2009, the first case filed by the plaintiffs was
dismissed on the grounds that they lacked antitrust standing.
However, the plaintiffs' attorneys immediately asked for
reconsideration and later filed an amended complaint advancing new
allegations including the theory of "casual injury".
In the new case, U.S. District Judge Phyllis J. Hamilton agreed
with Netflix and Wal-Mart, which argued that the plaintiffs failed
to meet their burden and demonstrate that Netflix and Wal-Mart's
alleged anticompetitive behavior caused Blockbuster to overcharge
them.
To rule in the plaintiffs' favor, Judge Hamilton said she would
have to believe they proved a "chain of causation" between
Blockbuster's price increases and the prices set by Netflix.
Ultimately, however, the chain was threadbare.
"As defendant points out, plaintiffs' theory of a causal link --
i.e. that Netflix pricing, by virtue of Netflix's status as the
dominant player in the online DVD rental market, constituted a
'maximum' ceiling that dictated Blockbuster's pricing -- is simply
too attenuated to be considered sufficiently direct," she wrote.
"More fundamentally, plaintiffs here have failed to point to any
true independent market 'constraint' or 'mechanism' that, as a
matter of economic principle, would predictably dictate the
setting of blockbuster's prices, as a form or function of
Netflix's prices," Judge Hamilton continued.
Finally, she said, the plaintiffs had not "truly disputed the
numerous independent factors aside from the purportedly unlawful
agreement in questions or . . . including the temporary and
unsustainable nature of the $14.99 price set by Blockbuster in
late 2004 and the influence of Blockbusters' finances, debt
covenants and service levels on Blockbuster's decision to
eventually raise prices."
In December 2010, Judge Hamilton granted class certification to
Netflix subscribers in the case.
A copy of the Order Granting Motion for Summary Judgment in In Re:
Online DVD Rental Antitrust Litigation, No. 09-2029 (N.D. Calif.),
is available at:
http://www.courthousenews.com/2011/05/06/walmart.pdf
NZ FINANCE COS: Trustee Class Action Gets 2200 Claims
-----------------------------------------------------
Interest.co.nz reports that a class action lawsuit to recover
compensation for investors in New Zealand finance companies has
received more than 2200 claims in the six weeks since it was
launched, law firm Turner Hopkins has announced.
The class action backed by Australian heavyweight law firm, Slater
and Gordon, is targeting the professional services firms tasked
with oversight of finance companies who have lost billions of
dollars in St. Laurence, Hanover Finance, Capital + Merchant and
MFS Pacific.
Those firms targeted include trustees.
Turner Hopkins Partner Andrew Hooker, Esq., said expressions of
interest from around 940 individual claimants had been received.
"The volume and the nature of claims that we received has been
significant. We have had an extremely positive response,"
Mr. Hooker said.
"Mum and dad investors and family trusts make up a considerable
portion of the claims so far, but we have also seen interest from
companies and institutional investors in a number of countries,"
Mr. Hooker said.
Mr. Hooker said more than 30 financial companies were named in the
claims received so far. The amounts lost varied, but some
investors had registered losses in the vicinity of $1 million.
"We are at a preliminary stage in the process, but currently it
looks like the majority of investors lost most of their original
investment -- including investors from those firms that have
already been through receivership or liquidation," Mr. Hooker
said.
The majority of investors were from Australia and New Zealand, but
claims had also been received from European, Asian and North
American investors, he said.
"We continue to seek interest from investors who sustained losses
following the collapses that took place within the New Zealand
financial sector between 2006 and 2009."
Slater and Gordon is helping Turner Hopkins to progress potential
claims against the trustees of the failed companies.
Australia's biggest class action law firm settled last month with
Sandhurst Trustees, the corporate trustees responsible for
monitoring collapsed Australian financial company Fincorp.
Turner Hopkins said expressions of interest were still open here.
OFFICEMAX NORTH: Removes "Thoms" Song-Beverly Suit to N.D. Calif.
-----------------------------------------------------------------
Nathan Thoms, on behalf of himself and others similarly situated
v. OfficeMax Incorporated, et al., Case No. CGC-11-508828 (Calif.
Super. Ct., San Francisco Cty.), was filed on March 4, 2011)).
The plaintiff accuses OfficeMax of recording and recording
personal information in conjunction with a credit card purchase
transaction in California, a practice that is prohibited under
California's Song-Beverly Credit Card Act, California Civil Code
Section 1747.08.
On April 26, 2011, plaintiff amended his Complaint by naming
OfficeMax North America, Inc., as a named defendant in place of
OfficeMax Incorporated. Other than the switch in named
defendants, the Complaint was not substantively changed.
On the basis of diversity jurisdiction, OfficeMax, on May 6, 2011,
removed the lawsuit to the Northern District of California, and
the Clerk assigned Case No. 11-cv-02233 to the proceeding.
Defendant operates retail stores under the name OfficeMax
throughout the United States, including California. Plaintiff
Nathan Thoms is a resident of California, and entered into a
retail transaction with defendant at one of defendant's California
stores.
The Plaintiff is represented by:
Gene J. Stonebarger, Esq.
Richard D. Lambert, Esq.
STONEBARGERLAW
A Professional Corporation
75 Iron Point Circle, Suite l45
Folsom, CA 95630
Telephone: (916) 235-7140
E-mail: gstonebarger@stonebargerlaw.com
rlambert@stonebargerlaw.com
The Defendant is represented by:
Matthew R. Orr, Esq.
Scott R. Hatch, Esq.
CALL & JENSEN
A Professional Corporation
610 Newport Center Drive, Suite 700
Newport Beach,CA 92660
Telephone: (949)717-3000
E-mail: morr@calljensen.com
shatch@calljensen.com
OVERSTOCK.COM INC: Appeal of Ruling in "Lane" Suit Still Pending
----------------------------------------------------------------
An appeal from the approval of Overstock.com, Inc.'s settlement of
a lawsuit alleging violations of the Electronic Communications
Privacy Act remains pending, according to the Company's April 28,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2011.
On August 12, 2008, the Company along with seven other defendants,
were sued in the United States District Court for the Northern
District of California, by Sean Lane, and seventeen other
individuals, on their own behalf and for others similarly in a
class action suit, alleging violations of the Electronic
Communications Privacy Act, Computer Fraud and Abuse Act, Video
Privacy Protection Act, and California's Consumer Legal Remedies
Act and Computer Crime Law. The complaint relates to the
Company's use of a product known as Facebook Beacon, created and
provided to the Company by Facebook, Inc. Facebook Beacon
provided the means for Facebook users to share purchasing data
among their Facebook friends. The parties extended by agreement
the time for defendants' answer, including the Company's answer,
and thereafter, the Plaintiff and Facebook proposed a stipulated
settlement to the court for approval, which would resolve the case
without requirement of financial contribution from the Company.
On March 17, 2010, over objections lodged by some parties, the
court accepted the proposed settlement. Various parties objecting
to the settlement have appealed and their appeal is now pending.
The nature of the loss contingencies relating to claims that have
been asserted against the Company has been described. However, no
estimate of the loss or range of loss can be made.
OVERSTOCK.COM INC: Awaits Ruling on Motion to Dismiss "Hines" Suit
------------------------------------------------------------------
Overstock.com, Inc., is awaiting a ruling on its motion to dismiss
and to decertify a class action lawsuit that seeks damages under
claims for breach of contract, according to the Company's
April 28, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2011.
On March 10, 2009, the Company was sued in a class action filed in
the United States District Court, Eastern District of New York.
Cynthia Hines, the nominative plaintiff on behalf of herself and
others similarly situated, seeks damages under claims for breach
of contract, common law fraud and New York consumer fraud laws.
The Plaintiff alleges that the Company failed to properly disclose
its returns policy to her and that the Company improperly imposed
a "restocking" charge on her return of a vacuum cleaner. The
Company filed a motion to dismiss based upon assertions that its
agreement with its customers requires all such actions to be
arbitrated in Salt Lake City, Utah. Alternatively, the Company
asked that the case be transferred to the United States District
Court for the District of Utah, so that arbitration may be
compelled in that district. On September 8, 2009, the motion to
dismiss or transfer was denied, with the court stating that the
Company's browsewrap agreement was insufficient under New York law
to establish an agreement with the customer to arbitrate disputes
in Utah. On October 8, 2009, the Company filed a Notice of Appeal
of the court's ruling. The appeal was denied.
On December 31, 2010, Ms. Hines filed an amended complaint. The
amended complaint eliminated common law fraud claims and breach of
contract claims and added claims for breach of Utah's consumer
protection statute and various other state consumer protection
statutes. The amended complaint also asks for an injunction. The
nature of the loss contingencies relating to claims that have been
asserted against the Company has been described. However, no
estimate of the loss or range of loss can be made. The suit is in
final discovery stages. The Company filed motions to dismiss and
to decertify the class. The court has not ruled on these motions.
The Company says it intends to vigorously defend this action.
PUDA COAL: June 13 Class Action Lead Plaintiff Deadline Set
-----------------------------------------------------------
Milberg LLP reminds shareholders that the lead plaintiff motion
deadline in securities lawsuits against Puda Coal, Inc., is
June 13, 2011. On April 21, 2011, the firm filed a class action
lawsuit on behalf of investors who purchased the securities of
Puda during the period Nov. 13, 2009, to April 11, 2011,
inclusive.
The case, Burquist v. Puda Coal Inc., No. CV11-03412, is pending
in the United States District Court for the Central District of
California and alleges violations of the Securities Exchange Act
of 1934 by Puda and certain of the Company's officers.
Puda is a supplier of premium high grade cleaned coking coal used
to produce coke for steel manufacturing in the People's Republic
of China. The Company is incorporated in Delaware and
headquartered in Taiyuan, Shanxi Province, China.
The Complaint alleges that throughout the Class Period, Defendants
made materially false and misleading statements to investors by
failing to disclose that the Company's Chairman, Ming Zhao, had
transferred ownership of Puda's operating entity, Shanxi Puda Coal
Group Co., Ltd., to himself, thereby rendering Puda an empty shell
company.
On April 8, 2011, Alfred Little, an investor who researches and
blogs about Chinese companies, exposed the transfer of Shanxi Coal
to Ming Zhao. In reaction to this news, shares of Puda's stock
fell $3.10 per share, or over 34%, to close at $6.00 per share, on
extremely heavy trading volume. On the next trading day,
April 11, 2011, the Company issued a press release stating that,
"[a]lthough the investigation is in its preliminary stages,
evidence supports the allegation that there were transfers by
Mr. Zhao in subsidiary ownership that were inconsistent with
disclosure made by the Company in its public securities filings.
Mr. Zhao has agreed to a voluntarily leave of absence as Chairman
of the Board of the Company until the investigation is complete."
In response to this announcement, the NYSE halted trading in the
Company's stock.
If you purchased securities of Puda from Nov. 13, 2009, to
April 11, 2011, you may move the court no later than June 13,
2011, 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.
About Milberg
Milberg LLP -- http://www.milberg.com-- is a class action and
complex 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.
If you wish to discuss this matter with us, please contact the
following attorneys:
Andrei Rado, Esq.
MILBERG LLP
One Pennsylvania Plaza, 49th Fl.
New York, NY 10119-0165
Telephone: (800) 320-5081
E-mail: arado@milberg.com
Jeff Westerman, Esq.
MILBERG LLP
300 South Grand Avenue, Suite 3900
Los Angeles, CA 90071
Telephone: (800) 320-5081
E-mail: contactus@milberg.com
RENT-A-CENTER INC: Accrues $2.8MM on Potential Settlement of Suits
------------------------------------------------------------------
Rent-A-Center, Inc., disclosed that as of March 31, 2011, it had
accrued $2.8 million relating to the prospective settlement of
certain putative class actions pending in California, according to
the Company's April 29, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2011.
From time to time, the Company, along with its subsidiaries, are
party to various legal proceedings arising in the ordinary course
of business. In its history, the Company has defended class action
lawsuits alleging various regulatory violations and have paid
material amounts to settle such claims. The Company accrues for
litigation loss contingencies that are both probable and
reasonably estimable. Legal fees and expenses associated with the
defense of all of its litigation are expensed as such fees and
expenses are incurred. As of March 31, 2011, the Company had
accrued $2.8 million relating to the prospective settlement of
certain putative class actions pending in California which allege
various claims, including violations of California wage and hour
laws.
Rent-A-Center, Inc. -- http://www.rentacenter.com/-- is a rent-
to-own operator. Rent-A-Center owns and operates more than 3,000
stores in 50 states, Washington, D.C., Canada, and Puerto Rico.
The Company's corporate headquarters are located in Plano, Texas.
ROTHMAN FURNITURE: Faces Consumer Fraud Class Action
----------------------------------------------------
Andrea Dearden, writing for The Madison St. Clair Record, reports
that a Belleville man has filed a class action consumer fraud
claim against an O'Fallon furniture store.
William Wiley, on behalf of hundreds of others, filed a lawsuit
April 1 in St. Clair County Circuit Court against Rothman
Furniture Stores, Inc. Mr. Wiley accuses the store of failing to
give him promotional money he was allegedly promised.
Mr. Wiley says in February 2009, he learned of a Rothman Furniture
sales promotion. The store allegedly promised that each customer
who bought more than $600 in furniture would receive $600 in free
gasoline.
Mr. Wiley says the promotion also promised an additional $600 in
free groceries if the same customer bought another $600 in
furniture.
Mr. Wiley says he purchased nearly $1000 in furniture from the
O'Fallon store on Highway 50 West and asked for the free gas and
groceries. He claims he filled out the proper paperwork and
submitted the required receipts but never received the $25 debit
cards he was promised.
Mr. Wiley, individually and on behalf of the class, accuses
Rothman Furniture of consumer fraud and asks for an undetermined
amount of money in damages plus interest and court costs.
These attorneys representing the class are:
David T. Butsch
James J. Simeri
Matthew R. Fields
BUTSCH SIMERI FIELDS LLC
231 South Bemiston Avenue, Suite 260
Clayton (St. Louis), MO 63105
Telephone: (314) 863-5700
E-mail: butsch@bsflawfirm.com
simeri@bsflawfirm.com
fields@bsflawfirm.com
The attorneys ask for a jury trial.
St. Clair County Circuit Court Case No. 11-L-171
SILICON LABORATORIES: Awaits Ruling on Motion to Dismiss Appeals
----------------------------------------------------------------
A motion to dismiss two appeals from the order granting final
approval of an agreement settling approximately 300 coordinated
cases against Silicon Laboratories, Inc., and other companies
remains pending, according to the Company's April 28, 2011, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended April 2, 2011.
On December 6, 2001, a class action complaint for violations of
U.S. federal securities laws was filed in the United States
District Court for the Southern District of New York against the
Company, four of its officers individually and the three
investment banking firms who served as representatives of the
underwriters in connection with the Company's initial public
offering of common stock. The Consolidated Amended Complaint
alleges that the registration statement and prospectus for the
Company's initial public offering did not disclose that (1) the
underwriters solicited and received additional, excessive and
undisclosed commissions from certain investors, and (2) the
underwriters had agreed to allocate shares of the offering in
exchange for a commitment from the customers to purchase
additional shares in the aftermarket at pre-determined higher
prices. The Complaint alleges violations of the Securities Act of
1933 and the Securities Exchange Act of 1934. The action seeks
damages in an unspecified amount and is being coordinated with
approximately 300 other nearly identical actions filed against
other companies. A court order dated October 9, 2002, dismissed
without prejudice the Company's four officers who had been named
individually. On December 5, 2006, the Second Circuit vacated a
decision by the District Court granting class certification in six
of the coordinated cases, which are intended to serve as test, or
"focus" cases. The plaintiffs selected these six cases, which do
not include the Company. On April 6, 2007, the Second Circuit
denied a petition for rehearing filed by the plaintiffs, but noted
that the plaintiffs could ask the District Court to certify more
narrow classes than those that were rejected.
The parties in the approximately 300 coordinated cases, including
the parties in the case against the Company, reached a settlement.
The insurers for the issuer defendants in the coordinated cases
will make the settlement payment on behalf of the issuers,
including the Company. On October 5, 2009, the Court granted
final approval of the settlement. Judgment was entered on
January 10, 2010. Two appeals are proceeding before the United
States Court of Appeals for the Second Circuit on behalf of
objectors to the settlement. Plaintiffs have moved to dismiss
both appeals.
As the litigation process is inherently uncertain, the Company
says it is unable to predict the outcome of the matter if the
settlement does not survive appeal. While the Company does
maintain liability insurance, the Company says it could incur
losses that are not covered by the Company's liability insurance
or that exceed the limits of the Company's liability insurance.
Such losses could have a material impact on the Company's business
and the Company's results of operations or financial position.
SMURFIT-STONE: Reaches Settlement in Principle in ERISA Suit
------------------------------------------------------------
Smurfit-Stone Container Corporation said it reached a settlement
in principle to settle a consolidated class action in Illinois
pursuant to the Employee Retirement Income Security Act, according
to the Company's April 29, 2011, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended
March 31, 2011.
In May 2009, a lawsuit was filed in the United States District
Court for the Northern District of Illinois against four
individual committee members of the Administrative Committee of
the Company's Savings Plans and Patrick Moore, the Company's Chief
Executive Officer. During the first quarter of 2010, two
additional ERISA class action lawsuits were filed in the United
States District Court for the Western District of Missouri and one
in the United States District Court for the District of Delaware.
The defendants in these cases are individual committee members of
the Administrative Committee, several other of the Company's
current and former executives and individual members of the
predecessor Company's Board of Directors. The suits were
consolidated into one matter in January 2011 in the Northern
District of Illinois. The consolidated complaint alleges certain
ERISA violations between January 1, 2008 and January 26, 2009.
The plaintiffs brought the complaint on behalf of themselves and a
class of similarly situated participants and beneficiaries of four
of the Company's Savings Plans. The plaintiffs assert that the
Defendants breached their fiduciary duties to the Savings Plans'
participants and beneficiaries by allegedly making imprudent
investments with the Savings Plans' assets, making
misrepresentations and failing to disclose material adverse facts
concerning the Company's business conditions, debt management and
viability, and not taking appropriate action to protect the
Savings Plans' assets. During April 2011, the parties reached an
agreement in principle to settle the case. The Company believes
the liability for this matter was adequately reserved at March 31,
2011.
All litigation that arose or may arise out of prepetition or pre-
discharge conduct or acts is subject to the Bankruptcy Discharge
Order and is either resolved consistent with all other general
unsecured claims in the bankruptcy or subject to dismissal based
on failure to properly file a claim. As a result, the Company
does not believe that this matter will not have a material adverse
effect.
About Smurfit-Stone
Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/--
is one of the leading integrated manufacturers of paperboard and
paper-based packaging in North America and one of the world's
largest paper recyclers. The Company operates 162 manufacturing
facilities that are primarily located in the United States and
Canada. The Company also owns roughly one million acres of
timberland in Canada and operates wood harvesting facilities in
Canada and the United States. The Company employs roughly 21,250
employees, 17,400 of which are based in the United States.
SMURFIT-STONE: Continues to Defend Antitrust Suits in Illinois
--------------------------------------------------------------
Smurfit-Stone Container Corporation continues to defend itself
from a consolidated class action lawsuit in Illinois over
antitrust allegations, according to the Company's April 29, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2011.
In September 2010, four putative class action complaints were
filed in the United States District Court for the Northern
District of Illinois against the Company and several other paper
and packaging companies. The Complaints allege that the Company
and the Class Action Defendants engaged in anti-competitive
activities and violation of antitrust laws by reaching agreements
in restraint of trade that affected the manufacture, sale and
pricing of corrugated products. The Complaints seek an
unspecified amount of damages arising from the sale of corrugated
products from 2005 to the date the lawsuit was filed. A
consolidated complaint was filed on November 8, 2010 by the
Complainants which contains allegations that limit the Company's
liability to conduct that arose subsequent to the bankruptcy
Effective Date. The Class Action Defendants filed motions to
dismiss the Complaints, which were denied by the Court on April 8,
2011. Given the limited time period for potential liability, the
Company believes the resolution of these matters will not have a
material adverse effect on its consolidated financial condition,
results of operations or cash flows.
All litigation that arose or may arise out of prepetition or pre-
discharge conduct or acts is subject to the Bankruptcy Discharge
Order and is either resolved consistent with all other general
unsecured claims in the bankruptcy or subject to dismissal based
on failure to properly file a claim. As a result, the Company
does not believe that this matter will not have a material adverse
effect.
About Smurfit-Stone
Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/--
is one of the leading integrated manufacturers of paperboard and
paper-based packaging in North America and one of the world's
largest paper recyclers. The Company operates 162 manufacturing
facilities that are primarily located in the United States and
Canada. The Company also owns roughly one million acres of
timberland in Canada and operates wood harvesting facilities in
Canada and the United States. The Company employs roughly 21,250
employees, 17,400 of which are based in the United States.
SMURFIT-STONE: Preliminary Injunction Hearing Set for May 18
------------------------------------------------------------
A Delaware state court scheduled a hearing on May 18, 2011, for a
motion for preliminary injunction filed by plaintiffs in a
consolidated putative class action against Smurfit-Stone Container
Corporation, according to the Company's April 29, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2011.
On January 23, 2011, Smurfit-Stone Container Corporation and Rock-
Tenn Company entered into an Agreement and Plan of Merger pursuant
to which the Company will merge with and into a subsidiary of
Rock-Tenn. This Merger, unanimously approved by the Boards of
Directors of both companies, will create a leader in the North
American paperboard packaging market with combined revenues of
approximately $9 billion.
Three complaints on behalf of a class of Smurfit-Stone
stockholders have been filed in the Delaware Court of Chancery
challenging the Merger Agreement: (i) Marks v. Smurfit-Stone
Container Corp.; (ii) Spencer v. Smurfit-Stone Container Corp.;
and (iii) Gould v. Smurfit-Stone Container Corp. On March 24,
2011, these cases were consolidated. The plaintiffs allege, among
other things, that the consideration agreed to in the Merger
Agreement is inadequate and unfair to the Company's stockholders,
that the February 24, 2011, preliminary joint proxy
statement/prospectus contained misleading or inadequate
disclosures regarding the proposed merger, that the individual
defendants breached their fiduciary duties in approving the Merger
Agreement and that those breaches were aided and abetted by Rock-
Tenn and its merger subsidiary. On March 24, 2011, the plaintiffs
moved for class certification. The court has set a schedule for
expedited proceedings in the consolidated matter, including
expedited discovery, and has scheduled a hearing on May 18, 2011
for the plaintiffs' anticipated motion for preliminary injunction.
The Company believes that the Delaware Complaints are without
merit and will vigorously defend against the allegations.
All litigation that arose or may arise out of prepetition or pre-
discharge conduct or acts is subject to the Bankruptcy Discharge
Order and is either resolved consistent with all other general
unsecured claims in the bankruptcy or subject to dismissal based
on failure to properly file a claim. As a result, the Company
does not believe that this matter will not have a material adverse
effect.
About Smurfit-Stone
Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/--
is one of the leading integrated manufacturers of paperboard and
paper-based packaging in North America and one of the world's
largest paper recyclers. The Company operates 162 manufacturing
facilities that are primarily located in the United States and
Canada. The Company also owns roughly one million acres of
timberland in Canada and operates wood harvesting facilities in
Canada and the United States. The Company employs roughly 21,250
employees, 17,400 of which are based in the United States.
SMURFIT-STONE: Merger Suit Still Stayed Pending Delaware Action
---------------------------------------------------------------
A consolidated putative class action challenging the merger of the
Smurfit-Stone Container Corporation and Rock-Tenn Company remains
stayed pending resolution of a motion for preliminary injunction
in a Delaware action, according to the Company's April 29, 2011,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2011.
On January 23, 2011, Smurfit-Stone Container Corporation and Rock-
Tenn Company entered into an Agreement and Plan of Merger pursuant
to which the Company will merge with and into a subsidiary of
Rock-Tenn. This Merger, unanimously approved by the Boards of
Directors of both companies, will create a leader in the North
American paperboard packaging market with combined revenues of
approximately $9 billion.
Three complaints on behalf of a putative class of Smurfit-Stone
stockholders have been filed in the Circuit Court for Cook County,
Illinois challenging the Merger Agreement: (i) Roseman v. Smurfit-
Stone Container Corp.; (ii) Findley v. Smurfit-Stone Container
Corp.; and (iii) Czech v. Smurfit-Stone Container Corp.. On
March 4, 2011, the plaintiffs in the consolidated action filed an
amended complaint, which names as defendants Smurfit-Stone, Rock-
Tenn, and the individual members of the Company's Board of
Directors. The amended complaint alleges, among other things, that
the consideration agreed to in the Merger Agreement is inadequate
and unfair to the Company's stockholders, that the February 24,
2011 preliminary joint proxy statement/prospectus contained
misleading or inadequate disclosures regarding the proposed
merger, that the individual defendants breached their fiduciary
duties in approving the Merger Agreement and that those breaches
were aided and abetted by Rock-Tenn and the Company. The amended
complaint seeks equitable relief, including an injunction
prohibiting consummation of the Merger Agreement. On April 21,
2011, the Court stayed this consolidated matter pending resolution
of a motion for preliminary injunction or until further order of
the Court filed by plaintiffs of class action complaints filed in
the Delaware Court of Chancery challenging the Merger Agreement:
(i) Marks v. Smurfit-Stone Container Corp.; (ii) Spencer v.
Smurfit-Stone Container Corp.; and (iii) Gould v. Smurfit-Stone
Container Corp.
The Company believes the Illinois-Cook County Complaints are
without merit and will vigorously defend against the allegations.
All litigation that arose or may arise out of prepetition or pre-
discharge conduct or acts is subject to the Bankruptcy Discharge
Order and is either resolved consistent with all other general
unsecured claims in the bankruptcy or subject to dismissal based
on failure to properly file a claim. As a result, the Company
does not believe that this matter will not have a material adverse
effect.
About Smurfit-Stone
Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/--
is one of the leading integrated manufacturers of paperboard and
paper-based packaging in North America and one of the world's
largest paper recyclers. The Company operates 162 manufacturing
facilities that are primarily located in the United States and
Canada. The Company also owns roughly one million acres of
timberland in Canada and operates wood harvesting facilities in
Canada and the United States. The Company employs roughly 21,250
employees, 17,400 of which are based in the United States.
SMURFIT-STONE: Continues to Defend "Dabrowski" Suit in Illinois
---------------------------------------------------------------
Smurfit-Stone Container Corporation continues to defend itself
in a putative class action in Illinois captioned Dabrowski v.
Smurfit-Stone Container Corp., according to the Company's
April 29, 2011, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2011.
On January 23, 2011, Smurfit-Stone Container Corporation and Rock-
Tenn Company entered into an Agreement and Plan of Merger pursuant
to which the Company will merge with and into a subsidiary of
Rock-Tenn. This Merger, unanimously approved by the Boards of
Directors of both companies, will create a leader in the North
American paperboard packaging market with combined revenues of
approximately $9 billion.
On February 17, 2011, a putative class action complaint was filed
against Smurfit-Stone, Rock-Tenn, the individual members of the
Company's Board of Directors, and a Rock-Tenn merger subsidiary,
in the United States District Court for the Northern District of
Illinois under the caption of Dabrowski v. Smurfit-Stone Container
Corp., which alleges the same claims asserted in a consolidated
class action pending in the Circuit Court for Cook County,
Illinois. On April 21, 2011, the plaintiff filed an amended
complaint alleging, among other things, that the consideration
agreed to in the Merger Agreement is inadequate and unfair to
Smurfit-Stone stockholders, that Smurfit-Stone and the individual
defendants breached their fiduciary duties in approving the Merger
Agreement and that those breaches were aided and abetted by Rock-
Tenn and its merger subsidiary. The plaintiff also alleges that
the March 31, 2011 amended joint proxy statement/prospectus
contained misleading or inadequate disclosures constituting
violations of Section 14(a) of the Securities Exchange Act of
1934. The plaintiff seeks equitable relief, including an
injunction prohibiting consummation of the Merger Agreement.
The Company believes the Illinois-Northern District Complaint is
without merit and will vigorously defend against the allegations.
All litigation that arose or may arise out of prepetition or pre-
discharge conduct or acts is subject to the Bankruptcy Discharge
Order and is either resolved consistent with all other general
unsecured claims in the bankruptcy or subject to dismissal based
on failure to properly file a claim. As a result, the Company
does not believe that this matter will not have a material adverse
effect.
About Smurfit-Stone
Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/--
is one of the leading integrated manufacturers of paperboard and
paper-based packaging in North America and one of the world's
largest paper recyclers. The Company operates 162 manufacturing
facilities that are primarily located in the United States and
Canada. The Company also owns roughly one million acres of
timberland in Canada and operates wood harvesting facilities in
Canada and the United States. The Company employs roughly 21,250
employees, 17,400 of which are based in the United States.
SONIC AUTOMOTIVE: Awaits Approval of Settlement in "Galura" Suit
----------------------------------------------------------------
Sonic Automotive, Inc., is awaiting final approval of its
settlement of a lawsuit relating to its antitheft protection
product, according to the Company's April 28, 2011, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2011.
Sonic is a defendant in the matter of Galura, et al. v. Sonic
Automotive, Inc., a private civil action filed in the Circuit
Court of Hillsborough County, Florida. In this action, originally
filed on December 30, 2002, the plaintiffs allege that Sonic and
its Florida dealerships sold an antitheft protection product in a
deceptive or otherwise illegal manner, and further sought
representation on behalf of any customer of any of Sonic's Florida
dealerships who purchased the antitheft protection product since
December 30, 1998. The plaintiffs are seeking monetary damages
and injunctive relief on behalf of this class of customers. In
June 2005, the court granted the plaintiffs' motion for
certification of the requested class of customers, but the court
has made no finding to date regarding actual liability in this
lawsuit. Sonic subsequently filed a notice of appeal of the
court's class certification ruling with the Florida Court of
Appeals. In April 2007, the Florida Court of Appeals affirmed a
portion of the trial court's class certification, and overruled a
portion of the trial court's class certification. In November
2009, the Florida trial court granted Summary Judgment in Sonic's
favor against Plaintiff Enrique Galura, and his claim has been
dismissed. Marisa Hazelton's claim is still pending.
Sonic says it currently intends to continue its vigorous appeal
and defense of this lawsuit and to assert available defenses.
However, an adverse resolution of this lawsuit could result in the
payment of significant costs and damages, which could have a
material adverse effect on Sonic's future results of operations,
financial condition and cash flows.
At a mediation held February 4, 2011, Sonic reached an agreement
in principle with the plaintiffs to settle this class action
lawsuit, and a settlement agreement was signed by the parties on
March 1, 2011. The settlement agreement remains conditioned upon
receiving final approval by the Florida state court. In the event
that a definitive settlement of this lawsuit is finalized upon
terms and conditions consistent with the settlement agreement,
such a settlement would not have a material adverse effect on
Sonic's future results of operations, financial condition and cash
flows.
SONIC AUTOMOTIVE: Wants Arbitrator's Partial Final Award Vacated
----------------------------------------------------------------
Sonic Automotive, Inc., is awaiting a ruling on its petition to
vacate an arbitrator's partial final award on class certification
in a consolidated lawsuit, according to the Company's April 28,
2011, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2011.
Several private civil actions have been filed against Sonic
Automotive, Inc., and several of its dealership subsidiaries that
purport to represent classes of customers as potential plaintiffs
and made allegations that certain products sold in the finance and
insurance departments were done so in a deceptive or otherwise
illegal manner. One of these private civil actions was filed on
November 15, 2004, in South Carolina state court, York County
Court of Common Pleas, against Sonic Automotive, Inc., and 10 of
Sonic's South Carolina subsidiaries. The plaintiffs in that
lawsuit were Misty J. Owens, James B. Wright, Vincent J. Astey and
Joseph Lee Williams, on behalf of themselves and all other persons
similarly situated, with plaintiffs seeking monetary damages and
injunctive relief on behalf of the purported class. The group of
plaintiffs' attorneys representing the plaintiffs in the South
Carolina lawsuit also filed another private civil class action
lawsuit against Sonic Automotive, Inc., and 3 of its subsidiaries
on February 14, 2005, in state court in North Carolina, Lincoln
County Superior Court, which similarly sought certification of a
multi-state class of plaintiffs and alleged that certain products
sold in the finance and insurance departments were done so in a
deceptive or otherwise illegal manner. The plaintiffs in this
North Carolina lawsuit were Robert Price, Carolyn Price, Marcus
Cappeletti and Kathy Cappeletti, on behalf of themselves and all
other persons similarly situated, with plaintiffs seeking monetary
damages and injunctive relief on behalf of the purported class.
The South Carolina state court action and the North Carolina state
court action have since been consolidated into a single proceeding
in private arbitration before the American Arbitration
Association. On November 12, 2008, claimants in the consolidated
arbitration filed a Motion for Class Certification as a national
class action including all of the states in which Sonic operates
dealerships. Claimants are seeking monetary damages and
injunctive relief on behalf of this class of customers. The
parties have briefed and argued the issue of class certification.
On July 19, 2010, the Arbitrator issued a Partial Final Award on
Class Certification, certifying a class which includes all
customers who, on or after November 15, 2000, purchased or leased
from a Sonic dealership a vehicle with the Etch product as part of
the transaction, but not including customers who purchased or
leased such vehicles from a Sonic dealership in Florida. The
Partial Final Award on Class Certification is not a final decision
on the merits of the action. The merits of Claimants' assertions
and potential damages will still have to be proven through the
remainder of the arbitration. The Arbitrator stayed the
Arbitration for 30 days to allow either party to petition a court
of competent jurisdiction to confirm or vacate the award.
Sonic says it will seek review of the class certification ruling
by a court of competent jurisdiction and will continue to press
its argument that this action is not suitable for a class-based
arbitration. On July 22, 2010, the plaintiffs in this
consolidated arbitration filed a Motion to Confirm the
Arbitrator's Partial Final Award on Class Certification in state
court in North Carolina, Lincoln County Superior Court. On
August 17, 2010, Sonic filed to remove this North Carolina state
court action to federal court, and simultaneously filed a Petition
to Vacate the Arbitrator's Partial Final Award on Class
Certification, with both filings made in the United Stated
District Court for the Western District of North Carolina. Sonic
intends to continue its vigorous defense of this arbitration and
to assert all available defenses. However, an adverse resolution
of this arbitration could result in the payment of significant
costs and damages, which could have a material adverse effect on
Sonic's future results of operations, financial condition and cash
flows.
SONY COMPUTER: Sued for Concealing Inherent Defect in PS3 Consoles
------------------------------------------------------------------
Henry Garcia, on behalf of himself and others similarly situated
v. Sony Computer Entertainment America, LLC, Case No. 11-cv-02246
(N.D. Calif. May 6, 2011), is filed on behalf all persons who
purchased all non-"Slim" models of SONY Playstation(R)3 consoles
in the United States from the date they were first sold until the
date notice is provided to the Class. Specifically, the Complaint
alleges that defendant failed to disclose an inherent defect in
its PS3 consoles.
According to Mr. Garcia, the PS3 consoles are defective from the
time of purchase because they overheat during normal and intended
use of the SONY-authorized videogames, including Call of Duty:
Modern Warfare 2 and Call of Duty: Black Ops (collectively "Call
of Duty"). The overheating triggers a phenomenon known as the
"Yellow Light of Death" or "YLOD." This defect renders the PS3
completely and permanently inoperable. Once the PS3 experiences
YLOD, the consumer is unable to use videogames, watch Blu-ray
discs, access the PS3's hard drive or otherwise use their PS3.
Despite knowledge of the inherent defect, SONY has not taken
responsibility for and continues to deny the existence of a
defect. Rather than confront the defect, which it fixed in later
models of the PS3, SONY has covered up and profited from the
defect, including by telling consumers that they should send the
defective PS3 to SONY for a costly "repair." In reality, SONY
sends consumers refurbished PS3's in the place of the PS3 that
experienced the YLOD. The "refurbished" consoles contain the same
inherent defect, which can fail in the same way again.
The Plaintiff is represented by:
Timothy G. Blood, Esq.
Thomas J. O'Reardon II, Esq.
Paula M. Roach, Esq.
BLOOD HURST & O'REARDON, LLP
600 B Street, Suite 1550
Sao Diego, CA 92101
Telephone: (619) 338-1100
E-mail: tblood@bholaw.com
toreardon@bholaw.com
proach@bholaw.com
- and -
David S. Casey, Jr., Esq.
Frederick Schenk, Esq.
Gayle Blatt, Esq.
CASEY GERRY SCHENK FRANCAVILLA
BLATT & PENFIELD, LLP
110 Laurel Street
San Diego, CA 92101
Telephone: (619) 238-1811
E-mail: dcasey@cglaw.com
fschenk@cglaw.com
gblatt@cglaw.com
- and -
David Lizerbram, Eq.
DAVID LIZERBRAM & ASSOCIATES
2247 San Diego Avenue, Suite 235
San Diego, CA 92110
Telephone: (619) 517-2272
E-mail: david@lizerbramlaw.com
SONY COMPUTER: Faces 8th Suit Over Private Data Breach
------------------------------------------------------
Jay Katz, on behalf of himself and others similarly situated v.
Sony Computer Entertainment America LLC, et al., Case
No. 11-cv-02229 (N.D. Calif. May 6, 2011), is filed on behalf of:
(a) The "Multistate Class": All persons or entities that
subscribed to the PlayStation Network or Qriocity service, and
suffered a disruption of service and/or breach of security
beginning on April 17, 2011; and
(b) The "New York Class": All persons or entities in the State
of New York that subscribed to the PlayStation Network or
Qriocity service, and suffered a disruption of service
and/or breach of security beginning April 17,
2011,
for equitable relief, breach of express warranty, negligence,
gross negligence, breach of implied contract, negligence per se,
and violation of New York Deceptive Practices Act, General
Business Law ("GBL") Section 349, et seq., and violations of
California's Business & Professions Code Section 17200 and Section
17500, as well as similar deceptive trade practices statutes and
consumer protection statutes in effect in other states nationwide.
This class action arises out of defendants' improper, reckless,
and negligent failure to protect or safeguard the personal,
private, non-public, financial, and sensitive information
that plaintiff and the Class provided defendants.
The plaintiff relates that between April 17 and April 19, 2011,
defendants learned of a system-wide security breach of the PSN.
However, it was not until April 26, 2011, that defendants finally
began to notify users that their Confidential Information had been
compromised or "hacked."
Plaintiff Jay Katz is a resident of Nassau County, State of New
York. Defendant Sony Computer Entertainment America LLC (f/k/a
Sony Computer Entertainment America Inc.) ("SCEA") is a Delaware
limited liability company with its executive offices and principal
place of business and corporate headquarters in Foster City,
California.
The plaintiff is represented by:
Michele M. Desoer, Esq.
WITES & KAPETAN, P.A.
1300 Clav Street, Suite 600
Oakland, CA 94612
Telephone: (888) 499-3649
E-mail: mdesoer@wklawyers.com
- and -
Marc A. Wites
WITES & KAPETAN, P.A.
4400 North Federal Highway
Lighthouse Point, FL 33064
Telephone: (954) 570-8989
SONY COMPUTER: Faces 9th Suit Over Private Data Breach
------------------------------------------------------
Chad Peterson, et al., on behalf of themselves and others
similarly situated v. Sony Computer Entertainment America LLC, et
al., Case No. 11-cv-02242 (N.D. Calif. May 6, 2011), seek to
redress defendant's breach of warranty, negligent data security,
violations of consumers' rights of privacy, violation of
California and United States statutes protecting electronic
privacy and financial data, failure to protect those rights, and
failure and on going refusal to timely inform consumers of
unauthorized third party access to their credit card
account and other nonpublic and private financial information.
On information and belief, PSN, Qriocity, and Sony Online
Entertainment LLC's security was breached sometime in mid-April
2011, exposing names, addresses, email addresses, birthdates,
usernames, passwords, logins, security questions and credit card
data belonging to approximately 100 million user accounts.
According to the Complaint, subsequent to the compromise of
private consumer information and financial data, defendant unduly
delayed informing entities and consumers whose data was
compromised of their vulnerabilities and exposure to credit card
(or other) fraud such that consumers could make an informed
decision as to whether to change credit card numbers, close the
exposed accounts, check their credit reports, or take other
mitigating actions. Defendant also failed to provide regular
credit reports and credit monitoring at their own expense to those
whose private data was exposed and left vulnerable.
Plaintiff Chad Peterson is a citizen of the State of California,
who maintains a residence in Folsom, California.
Defendant Sony Computer Entertainment America (formerly Sony
Computer Entertainment America Inc.) ("SCEA") is a Delaware
limited liability company with its executive offices and principal
place of business and corporate headquarters in Foster City,
California.
The Plaintiff is represented by:
C. Brooks Cutter, Esq.
William A. Kershaw, Esq.
Stuart C. Talley, Esq.
John R. Parker, Jr., Esq.
KERSHAW, CUTTER & RATINOFF, LLP
401 Watt Avenue
Sacramento, CA 95864
Telephone: (916) 448-9800
E-mail: bcutter@kcrlgal.com
wkershaw@kcrlegal.com
stalley@kcrlegal.com
jparker@kcrlegal.com
TEXAS: Comptroller Faces Second Privacy Class Action
----------------------------------------------------
Houston Chronicle reports that a second class-action suit has been
filed in federal court in Houston against Comptroller Susan Combs
on behalf of 3.5 million Texans whose personal information was
accidentally exposed online.
Attorney Muhammad Aziz told the Houston Chronicle that the
plaintiffs are seeking a $1,000 penalty "for each of these
individuals whose privacy was violated by the comptroller."
Ms. Combs' office said April 11 that it discovered it mistakenly
posted the data, including names and Social Security numbers, on a
publicly accessible server for months.
Ms. Combs has publicly apologized, blaming human error for the
data release, and has announced free credit monitoring for anyone
who's been affected.
She said she cannot comment on litigation.
TOLLGRADE COMMUNICATIONS: Settles "Tencza", "Equity Benefit" Suits
------------------------------------------------------------------
Tollgrade Communications, Inc., and the plaintiffs in the lawsuits
commenced by Steven Tencza and Equity Benefit Partners reached an
agreement in principle for the settlement and dismissal of the
lawsuits, according to the Company's April 28, 2011, Form 8-K
filing with the U.S. Securities and Exchange Commission.
Tollgrade Communications, Inc., entered into an Agreement and Plan
of Merger, dated as of February 21, 2011, with Talon Holdings,
Inc. (Parent), and Talon Merger Sub, Inc., a wholly owned
subsidiary of the Parent, pursuant to which Merger Sub is to be
merged with and into the Company, with the Company surviving the
Merger as a wholly owned subsidiary of Parent upon completion of
the merger. Parent is owned by investment funds managed by Golden
Gate Private Equity, Inc. On April 1, 2011, the Company filed a
definitive proxy statement describing the proposed merger with the
Securities and Exchange Commission.
Four purported class action lawsuits have been filed against the
Company, the Company's directors, and in some cases, Parent,
Merger Sub and Golden Gate Capital in connection with the proposed
merger: Steven Tencza vs. Edward H. Kennedy, et al. (Case No. GD-
11-003755 (Derivative) and Case No. GD-11-006284 (Class Action))
and Vladimir Gusinsky Revocable Trust vs. Edward H. Kennedy, et
al. (Case No. GD-11-003908 (Derivative) and Case No. GD-11-006285
(Class Action)), which were filed on February 24, 2011, and on
March 1, 2011, respectively, in the Court of Common Pleas of
Allegheny County, Pennsylvania; Equity Benefit Partners vs. Edward
H. Kennedy, et al. (Case No. 11-10364), filed in the Court of
Common Pleas of Butler County, Pennsylvania on March 18, 2011, and
Margaret W. Crouthamel vs. Edward H. Kennedy, et al., filed in the
U.S. District Court for the Western District of Pennsylvania (Case
No. 2:11-cv-00403-RCM) on March 28, 2011. On April 5, 2011, the
Tencza and Vladimir Gusinsky Revocable Trust cases were
consolidated at In re Tollgrade Communications, Inc. Derivative
and Class Action Litigation, Consolidated Case No. GD-11-003755.
On April 19, 2011, the Vladimir Gusinsky Revocable Trust case was
severed and voluntarily dismissed by the plaintiff with the
court's approval.
On April 27, 2011, the Company and the plaintiffs in Tencza and
Equity Benefit Partners reached an agreement in principle
providing for the settlement and dismissal of their lawsuits.
Pursuant to that agreement, the Company agreed to make certain
supplemental disclosures regarding the proposed merger and filed a
supplement to the Company's definitive proxy statement on
April 27, 2011.
UMH PROPERTIES: Sued in Tenn. Over Deceptive Consumer Practices
---------------------------------------------------------------
Tracey Dalzell Walsh at Courthouse News Service reports that in a
federal class action, Mexican immigrants say a Memphis trailer
park deceived and exploited them and violated fair housing laws
before, during and after the May 2010 flood that devastated the
park and cost some of them their trailers and all their "worldly
possessions."
The 29 named plaintiffs say the Memphis Mobile City trailer park
took advantage of their language difficulties with "deceptive and
exploitative consumer practices," by, among other things,
financing $30,000 trailers for 15 years and refusing to allow the
trailers to be moved until they were paid off.
Only "in the aftermath of the catastrophe" did "many facts come to
light about illegal policies, practices, and conditions at Memphis
Mobile City," the class claims.
The plaintiffs say the trailer park owners refused to help
residents after the flood and did not provide temporary housing,
though they promised they would.
Some residents had to sleep on the side of the road until help
came from local government and the Federal Emergency Management
Agency.
"Throughout the ordeal, the management of Memphis Mobile City was
uncooperative with residents and government officials, often
attempting to bully and intimidate residents to return to their
damaged or destroyed homes," the class claims.
Almost all of the residents of the trailer park are of Mexican
descent and many have a limited grasp on the English language.
They say defendants UMH Properties, UMH Sales and Finance and Gail
Whitten did not tell them the trailer park was in a flood plain
and had suffered flooding before.
"Despite this history of serious flood problems the defendants
have taken no meaningful actions to protect residents from
flooding and do not disclose the problem to prospective
residents," the class claims.
After the flood, the plaintiffs say, they discovered questionable
business transactions, such as financing trailers worth $30,000
over 15 years, which "causes a consumer to pay exponentially more
interest than a loan of a shorter term," which "locks [the
residents] into a lengthy and expensive lease commitment."
The complaint continues: "Residents are required to make monthly
installment payments for the mobile home and monthly lease
payments for the small lot on which the trailers sit. Undisclosed
to the potential residents is a vague clause buried in the
agreement that prohibits moving the mobile home until the debt has
been fully paid. Through this practice, the defendants lock
residents into what amounts to a multi-year lease for an almost
ridiculously overpriced small lot, in which the rent can be raised
unilaterally over and over again through the term of the
installment contract. In some instances, the monthly pad rental
exceeds the monthly payment for purchase of the trailer. The
structure of these transactions, combining a purchase of the
mobile home with an undisclosed long-term lease obligation, has
prevented residents at Memphis Mobile City who were purchasing a
trailer that may be salvageable from moving it away from the site
where it is likely to be flooded again."
The plaintiffs say the terms the defendants enforce make their
"dream and benefits of homeownership . . . illusory because the
resident will never own the land on which the trailer sits and is
under severe restrictions in moving the mobile home."
Plaintiff Raul Gonzalez estimates that it would have cost him
$128,500 to pay off the trailer and install it in a new site, but
the value of a 15-year-old trailer would not justify this cost.
The plaintiffs say that anyone who buys a mobile home from the
defendants "assumed all the responsibilities of home ownership,
but none of the benefits."
They seek damages under the Fair Housing Act, the Tennessee Human
Rights Act and the Tennessee Consumer Protection Act.
A copy of the Complaint in Arevalo, et al. v. UMH Properties,
Inc., et al., Case No. 11-cv-02339 (W.D. Tenn.), is available at:
http://www.courthousenews.com/2011/05/06/Memphis.pdf
The Plaintiffs are represented by:
Webb A. Brewer, Esq.
BREWER & BARLOW PLC
20 South Dudley, Suite 806
Memphis, TN 38103
Telephone: (901) 866-1653
E-mail: info@brewerbarlow.com
- and -
Charles S. Blatteis, Esq.
BLATTEIS LAW FIRM, PLLC
1068 Oakhaven Road
Memphis, TN 38119
Telephone: (901) 684-6018
WELLCARE HEALTH: Class Action Settlement Gets Final Approval
------------------------------------------------------------
Joe Carlson, writing for Modern Healthcare, reports that WellCare
Health Plans, the embattled Medicaid and Medicare managed-care
firm, has received final approval to pay $88 million in cash and
$113 million in stock to settle a class-action lawsuit from
shareholders who accused management of damaging the company by
committing fraud between 2002 and 2007.
The settlement, mentioned in an earnings report for the Tampa,
Fla.-based firm, comes on top of a proposed settlement of $137
million in cash with four whistle-blowers, federal civil
authorities and the attorneys general of nine states. The firm
has also paid $80 million in a federal criminal investigation, and
$10 million to the Securities and Exchange Commission.
WellCare has been beset by allegations of illegality for its
accounting and billing practices prior to 2007, including a system
in which executives conspired to falsely inflate expenses in a
Florida managed-care program in order to meet legal requirements
for medical-loss ratios.
WellCare, which now operates under deferred prosecution and
corporate integrity agreements, has since sued three of its former
executives to recoup losses because of the fraud. Five former
executives were also indicted criminally in March.
WYETH INC: Faces Antitrust Class Action Over Effexor Drug
---------------------------------------------------------
Courthouse News Service reports that in an antitrust class action,
a pharmacy-distributor claims Wyeth fraudulently delayed
introduction of generic versions of its extended-release Effexor
drug (venlafaxine hydrochloride), an antidepressant.
A copy of the Complaint in Stephen L. LaFrance Holdings, Inc., et
al. v. Wyeth, Inc., Case No. 11-cv-00199 (D. Miss.), is available
at:
http://www.courthousenews.com/2011/05/06/DrugAnti.pdf
The Plaintiffs are represented by:
Dianne M. Nast, Esq.
Erin C. Burns, Esq.
RODANAST, P.C.
801 Estelle Drive
Lancaster, PA 17601
Telephone: (717) 892-3000
E-mail: dnast@rodanast.com
eburns@rodanast.com
- and -
Michael L. Roberts, Esq.
ROBERTS LAW FIRM, P.A.
20 Rahling Circle
Little Rock, AR 72223
Telephone: (501) 821-5575
E-mail: mikeroberts@aristotle.net
- and -
Don Barrett, Esq.
BARRETT, P.A.
404 Court Square North
Lexington, MS 39095-0927
Telephone: (662) 834-9168
E-mail: dbarrett@barrettlawgroup.com
- and -
Thomas M. Sobol, Esq.
HAGENS BERMAN SOBOL SHAPIRO LLP
55 Cambridge Parkway, Suite 301
Cambridge, MA 02142
Telephone: (617) 482-3700
E-mail: tom@hbsslaw.com
* AUSTRALIA: May Face Class Suit Over Solar Panel Tariff System
---------------------------------------------------------------
Ben Cubby, writing for The Sydney Morning Herald, reports that the
state government may have acted unlawfully when it suspended the
state's solar panel tariff system -- and angry panel installers
and customers are mustering for a class action.
The government failed to publish the change in the Government
Gazette beforehand or state that the scheme had reached maximum
capacity of 300 megawatts -- technicalities which may mean the
scheme should not have been suspended on April 29.
Those in the industry who think the government has breached the
law said power utilities should not be stopping new solar
households from connecting to the grid.
The Minister for Resources and Energy, Chris Hartcher, said he had
the authority to announce changes to the scheme and legislate
retrospectively. But no legislation for changing the scheme has
been put to Parliament.
"All customers who submitted applications before midnight 28
April, 2011, but are not yet connected to the solar bonus scheme,
may still be eligible to participate in the scheme subject to the
requirements of the current legislation," a spokeswoman for
Mr. Hartcher said. "All aspects of the scheme will be reviewed by
the solar summit which may make recommendation to the government."
The solar summit is a gathering of industry figures and government
representatives, part of which was set to take place in Sydney on
May 6, to grapple with problems caused by the solar bonus scheme.
The previous government introduced the scheme and it was far more
popular than anticipated, grossly exceeding its budget.
An environmental law lecturer at the Australian National
University, James Prest, said the announcement has exposed the
power utilities to potential court action for not certifying
people's connections to the power grid.
"Until the change is subject to legislation or has been gazetted,
the distribution network service providers are potentially in
breach of their licence conditions and they would be liable for
damages," Dr. Prest said.
The Electricity Supply Act 1995 states that the network service
providers must connect households, but since Mr. Hartcher
announced the scheme was suspended, some are no longer doing so.
"In his rush to kill off the solar bonus scheme, Energy Minister
Chris Hartcher bypassed his legal requirements and exposed the
state to the risk of an expensive class action," said the Greens
MP John Kaye.
"The O'Farrell government has put its hostility to renewable
energy on display. They were prepared to act outside the law to
kill off the solar bonus scheme and to stop people connecting
panels to the grid."
One solar panel installer, SolarSwitch, said utilities including
Country Energy and Energy Australia were not certifying solar
systems owned by its customers because of the announcement.
"Every single day the energy companies hold off it is costing us
and our customers money," said Alle Tesoriero, a SolarSwitch
spokeswoman. "We will be seeking legal advice and supporting our
customers if the situation in NSW is not resolved."
The Solar Energy Industries Association, a group representing a
large portion of the state's solar panel installers, said the
solar industry was in limbo.
"We have companies with literally warehouses full of panels that
they have already bought, and no idea if they can even make their
money back," said the association's chairman, Ged McCarthy.
Installers and customers would explore the possibility of mounting
a class action against the power providers, he said.
The industry was also digesting news on May 5 the federal
government would reduce subsidies for panel installation from a
peak of up to AU$6,200 to June 30 this year to about AU$1,200 for
a basic 1.5kw system after July 1, 2013.
*********
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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Copyright 2011. All rights reserved. ISSN 1525-2272.
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