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C L A S S A C T I O N R E P O R T E R
Tuesday, May 15, 2012, Vol. 14, No. 95
Headlines
AMERICAN EXPRESS: Judge Orders Discovery in Class Action
ASSET ACCEPTANCE: Faces Class Action Over Old Credit Card Debts
BANK OF AMERICA: Federal Securities Class Action Trial in October
BANKWEST: Faces Class Action Over Invalid Motel Valuation
CENTRO RETAIL: Finalizes AUD200-Mil. Class Action Settlement
CONSUMER PORTFOLIO: Awaits Final OK of Illinoi Suit Settlement
DBSI SECURITIES: Faces $2 Billion Class Action
DES MOINES, IA: Seeks Bill to Help Recover Franchise Fee Refund
E.I. DUPONT: Discovery in Ohio Drinking Water Suit Still Ongoing
E.I. DUPONT: Recorded $225-Mil. Charge for Imprelis(R) Claims
ERESEARCH TECHNOLOGY: Being Sold to Genstar for Too Little
FOCUS MEDIA: Consolidated Suit Dismissal Appeal Remains Pending
FOCUS MEDIA: To Defend "Palny" Class Suit in New York
GROUPON: Securities Class Action Lead Plaintiff Deadline Nears
HALLIBURTON CO: Awaits Ruling on Motion to Appeal Class Cert.
HALLIBURTON CO: RCRA Claims Over Duncan Operations Dismissed
HALLIBURTON CO: Two Settlements in Macondo MDL Filed in April
IU HOSPITAL: Uninsured Patients Sue Over "Chargemaster" Rate
LIFEWAY KEFIR: Faces Class Action Over False Claims on Yoghurt
MCKENZIE CHECK: Argument on Class Action Arbitration Heard
METRA: Faces Class Action Over Ticket Expiration Date Policy
RADIOSHACK CORP: Defends Suits Over Song-Beverly Act Violations
RADIOSHACK CORP: Mulls Effect of "Brinker" Decision on "Brookler"
RADIOSHACK CORP: Mulls Effect of "Brinker" Ruling on "Ordonez"
RADIOSHACK CORP: Mediation in March Did Not Resolve Ill. Suit
RITE AID: Defends Store Managers' Class Suits in Various States
RITE AID: Still Defends Wage and Hour Violations Class Suits
ROYAL CARIBBEAN: Awaits Ruling on Bid to Dismiss Attendants' Suit
ROYAL CARIBBEAN: Seeks Dismissal of Consolidated Suit in Florida
SALSA CYCLES: Recalls 1,100 Bicycle Racks Due to a Fall Hazard
SNC-LAVALIN GROUP: Rochon Genova Commences Class Action
SNC-LAVALIN GROUP: Siskinds Files Securities Class Action
SONY COMPUTER: Judge Dismisses "Call of Duty" Class Action
STRYKER CORP: Securities Suit in Michigan Dismissed in March
SUPREME TRADING: Recalls 320 Children's Letterman Jackets
SWISHER HYGIENE: Class Action Lead Plaintiff Deadline Nears
TOWN SPORTS: Still Awaits Order on Suits v. Unit Dismissal Bids
WAL-MART STORES: Recalls 21,000 Banzai Inflatable Pool Slides
WMI LIQUIDATING: LTW Settlement Became Effective in April
* Conception Ruling Leads to Dismissal of 76 Class Actions
*********
AMERICAN EXPRESS: Judge Orders Discovery in Class Action
--------------------------------------------------------
William Dotinga at Courthouse News Service reports that a federal
judge ordered discovery in a class action alleging that American
Express makes unsolicited calls to customers' cellphones -- even
though the matter is set to go to arbitration.
Karin O'Brien sued American Express over calls she claims the
credit card company made to her cellphone without her express
prior consent, in violation of the federal Telephone Consumer
Protection Act. Mr. O'Brien brought a class action before the
court, but American Express argued that she is required to
arbitrate her claims on an individual basis under the terms of her
cardholder agreement.
Mr. O'Brien seeks discovery on the development of the arbitration
clause in the agreement to determine if it is unconscionable.
American Express opposes any discovery, arguing that the formation
of the arbitration clause is not at issue in the case. The
company also argues that Mr. O'Brien's unconscionability argument
has been preempted by the Supreme Court's decision in AT&T
Mobility LLC v. Concepcion, that discovery for a class action is
inappropriate and that what she seeks is already public
information and should be in her possession.
U.S. Magistrate Judge Bernard Skomal wrote that while discovery
rules are broad in civil actions, the Federal Arbitration Act
limits the scope of discovery permitted with a motion to compel
arbitration.
"The FAA provides for discovery in connection with a motion to
compel arbitration only if 'the making of the arbitration
agreement or the failure, neglect or refusal to perform the same
be an issue," Judge Skomal wrote, citing Simula Inc. v. Autoliv
Inc.
But American Express's argument that Mr. O'Brien -- who has been
an AmEx customer since 1988 -- accepted the terms of the
cardholder agreement and its arbitration clause when she used the
card didn't hold water with Judge Skomal.
"Plaintiff, due to the complexity of the decades-long relationship
between the parties and the volumes of documents involved, seeks
discovery related to the formation and amendment of the agreement.
Plaintiff requests discovery on 'the manner, method and means by
which AEC cardholders were notified of amendments to their card
member agreements' and 'communications by and between plaintiff
and AEC.' The finds this discovery is relevant to the formation
or making of the agreement and grants plaintiff's request to take
this limited discovery," Judge Skomal ruled.
With regard to Mr. O'Brien's request to take discovery for an
unconscionability defense, Judge Skomal looked at both California
law and Utah law since the cardholder agreement contains a Utah
choice-of-law provision.
California law "provides that 'when it is claimed or appears to
the court that the contract or any clause thereof may be
unconscionable the parties shall be afforded a reasonable
opportunity to present evidence as to its commercial setting,
purpose and effect to aid the court in making the determination,'"
Judge Skomal wrote, citing the law.
"Under this provision, courts have permitted a party opposing a
motion to compel arbitration to obtain discovery relevant to the
issue of unconscionability," he continued.
Utah's law is very similar to California law according to Judge
Skomal, reinforcing his decision to allow discovery to ascertain
unconscionability.
However, the magistrate did not agree to Mr. O'Brien's entire list
for discovery, denying several of them because either they do not
pertain to unconscionability, are duplicative or are not germane
to her case against American Express. He also admonished both
sides "to make every effort to resolve all disputes without court
intervention."
Discovery must be completed by July 9, and Mr. O'Brien's response
to American Express's motion to compel arbitration is due July 23.
A hearing on the motion is set for Aug. 10.
A copy of the Order Granting in Part and Denying in Part
Plaintiff's Motion to Compel Discovery, Case No. 11-cv-01822 (S.D.
Calif.), is available at:
http://www.courthousenews.com/2012/05/10/O%27Brien%20v%20AmEx.pdf
ASSET ACCEPTANCE: Faces Class Action Over Old Credit Card Debts
---------------------------------------------------------------
Sheryl Harris, writing for The Plain Dealer, reports that a debt
buyer that paid $2.5 million to the FTC over alleged collection
violations is embroiled in another battle over its pursuit of
time-barred debts, this one in Lake County.
Asset Acceptance, a company that buys and tries to collect on
older debts, agreed as part of a settlement with the FTC in
January that it would proactively tell consumers if the debt it
was trying to collect from them was too old to pursue in court.
While it was settling with the FTC, Asset Acceptance was trying to
fend off a class-action suit in Lake County over its use of courts
to try to pursue old credit card debts.
The Lake County case started in 2008, when Asset Acceptance sued a
Painesville man over a credit card debt from 2001.
The credit card agreement said that, no matter where a consumer
lives, the laws of New Hampshire apply, and one of New Hampshire's
law sets a three-year deadline for suing over a credit card
agreement.
The Painesville man's lawyer claimed in a countersuit that Asset
Acceptance was wrongly trying to use Ohio's longer statute and
simply filed suit too late.
The case has pinged between the county court and the appeals court
for several years, but the 11th District Court of Appeals rejected
an appeal by Asset, meaning the class-action suit will finally get
under way.
Beachwood attorney Anand Misra, who represents consumers, said the
trial will determine whether Asset violated the Fair Debt
Collection Practices Act by pursuing judgments against Ohio
consumers for time-barred credit card debts.
The suit seeks refunds for consumers if the court decides they
were wrongly sued.
BANK OF AMERICA: Federal Securities Class Action Trial in October
-----------------------------------------------------------------
Steven M. Davidoff and Peter K. Henning, writing for The New York
Times' The DealBook, report that the bitter aftertaste from Bank
of America's acquisition of Merrill Lynch refuses to dissipate.
Gretchen Morgenson of The New York Times has reported that
plaintiffs' law firms representing shareholders are fighting over
whether to settle class-action lawsuits against the Bank of
America board over the acquisition for $20 million.
A group of law firms representing plaintiffs who sued for similar
claims in Delaware are up in arms that the deal in Manhattan is a
shareholder sellout. But while the settlement is problematic,
another federal securities lawsuit out there is the real billion-
dollar case. This case is based on false statements in Bank of
America's proxy solicitation for approval of the Merrill
acquisition. This is where the real money is.
So why is there a difference in the potential winnings in the
shareholder cases and the federal securities case?
The shareholder cases largely comprise state law claims against
the bank's board and executives brought in the Delaware Chancery
Court and the Federal District Court in Manhattan.
In those cases, the plaintiffs contend that the bank's board
breached its fiduciary duties by approving the acquisition and
failing to try to terminate the deal based on Merrill's poor
performance in the fall of 2008. The plaintiffs also assert that
board members failed to disclose the compensation to be paid at
yearend to Merrill employees and failed to disclose Merrill's
interim and yearend results in a timely manner.
The shareholder cases are in turmoil. The Delaware plaintiffs are
calling the $20 million settlement in the Manhattan case grossly
inadequate.
But everyone seems to be ignoring the federal securities case
related to proxy violations.
That case was brought by a different set of lawyers and does not
involve any claims under state law. The lawsuit claims that Bank
of America and some of its executives failed to disclose in the
proxy statement problems at Merrill Lynch. Among other claims,
the federal securities case says the bank ignored that there was a
material adverse change, with respect to Merrill, and that Bank of
America withheld information about compensation payouts due at
Merrill.
This is essentially the same set of facts as the shareholder
cases, but it involves federal law. Unlike claims under state
law, a federal securities suit is brought by investors against the
defendants. This makes a big difference in how a court treats the
lawsuit.
Because the shareholder cases are based on state law, they are
called a derivative suit. Shareholders are trying to sue the
board on behalf of the company, asserting that the directors
violated their fiduciary duties in connection with the Merrill
acquisition.
This is a difficult claim to prove. The parties have to show that
Bank of America's board acted in bad faith for going through with
the acquisition or failing to disclose important information. The
standard to establish bad faith is high -- plaintiffs essentially
have to show that the company's board knew that Bank of America
would be harmed but willfully went forward with the merger.
Shareholders win these claims about as often as the Knicks win
N.B.A. championships.
Because of the low likelihood of success, the $20 million
settlement should not be surprising. Proving that Bank of
America's directors acted in bad faith was going to be difficult -
even though the facts here look like Bank of America forced the
acquisition down shareholders' throats. This is a legal standard
intended to protect board members from liability; a case against
the Bear Stearns directors for selling on the cheap was also
dismissed.
Moreover, any damages here would be paid directly to Bank of
America, and covered by insurance so nothing is likely to come out
of a director's pocket. Damages paid in the federal securities
law case, however, would be paid to shareholders.
The federal securities case is before Judge Kevin Castel of the
Federal District Court in Manhattan, the same judge considering
the settlement of the state law claim. As the Deal Professor
wrote in September 2011 about these federal claims:
"Plaintiffs in this private case have the additional benefit that
this claim is related to a shareholder vote. It is easier to
prove securities fraud related to a shareholder vote than more
typical securities fraud claims like accounting fraud.
Shareholder vote claims do not require that the plaintiffs prove
that the person committing securities fraud did so with awareness
that the statement was wrong or otherwise recklessly made. You
only need to show that the person should have acted with care.
"This case is not only easier to establish, but the potential
damages could also be enormous. . . . . A court will most likely
calculate this by referencing the amount that Bank of America
stock dropped after the loss was announced; this is as much as $50
billion. It is a plaintiff's lawyer's dream."
The federal securities case does not require the same evidence of
bad faith as the shareholder cases, and directors who go to trial
and lose may not seek to have the company pay the costs of any
judgment against them. These differences may be worth hundreds of
millions of dollars for any settlement.
So Bank of America shareholders should not despair. The lack of a
big settlement in the shareholder cases only leaves more room in
the federal securities law action for a recovery under Bank of
America's director and officers insurance policy (which Reuters
estimates to be about $500 million).
The shareholder cases are more notable for the mess that the
plaintiffs' lawyers have made of it. Alison Frankel at Thomson
Reuters has reported that the Bank of America defendants have
already filed a brief in the Delaware court that is quite damning.
It shows that lawyers in both cases were speaking about settling
the case, but that the two law firms in the New York case were
willing to settle it for a much lower amount.
Ms. Frankel also notes that both of these cases have been going
for years on a parallel track. Typically this problem is resolved
by one set of firms cutting in the others for part of a fee. But
that did not happen here.
In other words, the dispute in the shareholder cases is really a
failure of coordination and shows the perils of multiple
litigation on the same legal claim in different jurisdictions. It
also shows the potential for shareholders to lose out in such
disputes, something Delaware lawyers themselves call "a race to
the bottom."
Delaware Chancellor Leo E. Strine Jr. on May 4 denied the Delaware
plaintiffs' attempt to halt the New York settlement of the
shareholder cases. According to Bloomberg News, he stated that "I
have no confidence that I have the authority to enjoin parties to
a federal proceeding."
By doing so, Chancellor Strine sidesteps any dispute and leaves
the approval in the hands of the New York judge who was also
considering this issue on May 4. While it might be expected that
the New York judge further inquire into the means of this
settlement and some further tinkering to placate the Delaware
plaintiffs, it is hard to see much more occurring.
The real action will begin in October, when the federal securities
law case is scheduled for trial.
BANKWEST: Faces Class Action Over Invalid Motel Valuation
---------------------------------------------------------
Giselle Wakatama, writing for ABC Newcastle, reports that a couple
who say they were wronged by a major bank when they bought a Port
Stephens motel have joined a class action against the lender.
Sylvia and Gilbert De Michiel paid $2.4 million for a Nelson Bay
Motel in 2008, an amount agreed to by a Bankwest-appointed valuer.
But, the couple say the valuation was invalid, due to forged
accounts and fake future bookings.
Sylvia De Michiel says the valuer also failed to mention that dogs
had been living in the managers flat.
"The moment we had those keys handed over we walked up the stairs
and the stench was unbelievable," she said.
Gilbert De Michiel says he was outraged at the state of the motel
and has joined a class action against the lender.
"The minute we got into the property we realized that we'd been
taken," he said.
"The property was not what we had actually bought.
"There were no bookings, there were no books, no nothing.
"The first week, I think we had one or two people, so in order to
make this a goer we sold virtually everything we had."
After the Commonwealth Bank acquired Bankwest, a second valuation
was ordered in 2011.
It was well below what the couple paid and the bank called in
receivers, alleging they had breached their loan to value ratio.
The bank says it only appoints receivers when contractual
obligations are breached.
Sydney lawyer Van Moulis is heading up the potential class action.
He says it is a complex case.
"It involves allegations relating to artificially low valuations
of the security properties, primarily by Commonwealth Bank for the
purpose of triggering early repayment and we say circumstances
which were improper."
Bankwest says it does not sell properties for less than market
value.
A Senate Inquiry is currently being held into the post-global
financial crisis banking sector.
Mr. Moulis says he is hopeful it will scrutinize the actions of
Bankwest.
"As you might well imagine a number of the group have been
financially devastated as a result of the bank's summing them up
so I welcome the Senate Inquiry which will very likely investigate
the circumstances surrounding the sale of Bankwest to the
Commonwealth Bank."
CENTRO RETAIL: Finalizes AUD200-Mil. Class Action Settlement
------------------------------------------------------------
The Australian Associated Press reports that property group Centro
has finalized a $200 million settlement with thousands of
Australian investors in the country's biggest ever class action.
Corporations have been put on notice about their obligations to
shareholders, after thousands of Australian mum-and-dad investors
won AUD200 million in the country's biggest ever class-action
settlement.
The settlement deal, announced in the Federal Court in Melbourne
on May 10, provides a payout to 6,000 litigants from property
group Centro and its auditor PricewaterhouseCoopers.
The litigants, some of whom lost their life savings, accused the
Centro Property Group and its affiliate Centro Retail of
misleading and deceptive conduct for not disclosing it had at
least AUD3 billion of interest-bearing debt falling due within a
year.
About AUD150 million of the payout will be shared by about 1,000
clients -- including large financial institutions -- of Maurice
Blackburn lawyers, while AUD50 million will go to investors
represented by Slater and Gordon -- 5,000 mainly mum-and-dad or
retiree investors.
Law firms for the plaintiffs hailed the win a significant victory
for investors' rights.
James Higgins of Slater and Gordon said it was an important fight
for the rights of investors who are vulnerable to corporations
which fail to meet their legal obligations.
Maurice Blackburn class action principal Martin Hyde said the
outcome sent a strong message to corporations that they will be
made accountable to shareholders if their conduct falls short of
the law.
The settlement comes almost four years after the class action
began in 2008 amid allegations that Centro directors misled
investors in a 2007 financial report.
The case went to trial in March, with the plaintiffs alleging
Centro failed to disclose the financial risk to which its
investors were exposed.
At the time, Centro failed to disclose the due date of the AUD
billion debt it was financing the acquisition of a US-listed
shopping-mall trust.
When it did disclose it, as was legally required by the Australian
Securities Exchange, its shares plunged by 76% in one day.
Claimants are yet to be advised of payment dates and amounts and
the parties must return to the Federal Court on June 19 to
finalize the settlement.
Centro Group has since restructured and is now Centro Retail
Australia.
Centro Retail Australia says the settlement allows it to move on
and focus on improving value for its security holders.
It confirmed it would contribute AUD85 million to an in-principle
settlement payment of AUD200 million. The remainder will come
from PricewaterhouseCoopers, as well as the company formerly known
as Centro Properties Group and insurance proceeds.
"The settlement of the proceedings is a commercial decision taken
to allow the company to put this matter behind it and continue its
focus on adding value for its investors," Centro Retail chairman
Bob Edgar said in a statement.
Leonie Wood, writing for The Sydney Morning Herald, said lawyers
representing nine parties in the Centro class action have ended
their "kabuki dance" of negotiations and agreed to put a proposed
AUD200 million settlement to investors to consider, the Federal
Court heard on May.
The deal must be explained first to the 6,000 participants in the
class action, and then it will return to court on June 19, when
Justice John Middleton will consider if it is fair and reasonable.
Michael Lee, SC, counsel for shareholders represented by the law
firm Maurice Blackburn, told Justice Michelle Gordon on May 10
that there was no longer any need to retain expert witnesses and
the parties wanted a court order vacating the trial.
The deal brings to an end a trial that lasted 10 weeks and which
at times involved extraordinary and sometimes heated clashes
between counsel and with Federal Court judge Michelle Gordon.
But in agreeing to vacate the trial on May 10, Justice Gordon made
a lengthy and unusual statement in which she thanked the 50 or so
lawyers at the bar tables, court staff, transcript providers, her
associates, executive assistant and non-parties at the back of the
courtroom.
She said she understood that the time expended on the trial had
taken a toll on the people involved and their families.
But Justice Gordon then said the Federal Court now wanted to
consider if there needed to be changes in the way big and complex
cases such as Centro are handled.
She has asked legal practitioners to consider what might be done
differently and what suggestions they have for possible
modification in the processes and procedures of the court.
In a separate report, The Sydney Morning Herald's Ms. Wood
disclosed that litigation funder IMF Ltd will recoup about AUD60
million from the AUD200 million Centro class-action settlement
before accounting for about AUD15 million of legal costs.
IMF's figures, released to the stock exchange, suggest the two
sets of investors who participated in the class action will share
about AUD125 million after legal bills.
At the same time, the recently formulated Centro Retail Australia
group has confirmed it will contribute AUD85 million to the
settlement, insurance policies will pick up AUD38 million and a
further AUD10 million will come from the CNPR group.
IMF will book a profit before tax of about AUD42 million,
indicating its take-home fee is about 28 per cent.
The settlement is the biggest yet in Australia's relatively
youthful class-action regime, dwarfing the AUD144.5 million payout
in the 2008 Aristocrat case.
But the case has been one of the most costly. In total, legal
expenses may exceed AUD50 million, although a big portion of this
will be borne by the Centro Group and its former auditors, PwC.
It has also been highly damaging to PwC and one of its audit
partners, Stephen Cougle, who repeatedly declined to accept
responsibility for blunders in Centro's 2007 audit that he said
were made by junior members of staff whom he supervised.
CONSUMER PORTFOLIO: Awaits Final OK of Illinoi Suit Settlement
--------------------------------------------------------------
Consumer Portfolio Services, Inc. is awaiting final approval of a
settlement of a class action lawsuit in Illinois, according to the
Company's April 24, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended March 31,
2012.
The Company is named as defendant in a putative class action
brought in federal district court in Chicago, Illinois. In March
2012, the court gave preliminary approval to a settlement agreed
to between the Company and the plaintiffs, pursuant to which (i) a
class will be certified for settlement purposes only, and (ii) the
Company will pay a fixed amount of plaintiff attorney fees and
also make payments against claims made by members of the class,
the amount of which will be based on class members' responses to
the Company's notice of the settlement. Final approval and
effectiveness of the settlement will occur only following notice
to the class members, a hearing on the fairness of the settlement,
and ultimate approval of the settlement following such a hearing.
The Company says its legal contingency accrual at March 31, 2012,
includes its estimate for the amount that is probable. There can
be no assurance as to the ultimate outcome of the case.
DBSI SECURITIES: Faces $2 Billion Class Action
----------------------------------------------
Cynthia Sewell, writing for The Idaho Statesman, reports that in
June 2010, Dynamis Energy Senior Vice President Wade Devin Thomas
joined the Eagle company that is planning to build a $70 million
waste-to-energy facility at the Ada County landfill.
Mr. Thomas was chief compliance officer for DBSI Securities and
associate general counsel for DBSI Inc. from April 2005 to January
2009. DBSI is embroiled in a federal criminal investigation and a
complex bankruptcy.
"I am not being investigated. I have been working with the
bankruptcy trustee," Mr. Thomas said on May 4.
Dynamis Vice President Peter Allen Johnson joined Dynamis in early
2009. Mr. Johnson was vice president of DBSI Securities until he
was laid off in September 2008.
"I am not under investigation at all that I am aware of," said
Mr. Johnson. "Not very many people knew what was going on there.
I was not an insider."
Both Messrs. Thomas and Johnson said they are not a party in any
of the civil suits against DBSI.
DBSI managed commercial properties for investors around the
country.
Before filing for bankruptcy in November 2008, the company
controlled 244 commercial properties and had more than 8,500
investors.
It managed 16 properties in the Treasure Valley, including the
Northgate Shopping Center near Glenwood and State streets.
DBSI collapsed as real estate values fell and lending dried up.
It left people who had purchased partial ownership in buildings
through the company scrambling to save their investments.
Ada County Commissioner Sharon Ullman, a proponent of the Dynamis
deal with Ada County, said she is not concerned about the
connection.
"The fact somebody in a company did something wrong does not mean
that people who were working there were wrong," Ms. Ullman said.
"The county did its due diligence. We know the technology is
sound. . . . I believe this project will work."
Residents from Hidden Springs hosted two town hall meetings about
the Dynamis project at the landfill, which is about one mile from
the 1,000-home community north of Boise. Critics of the project
question its finances, its environmental impact and a $2 million
payment Ada County made in 2010 to jump-start the trash-to-energy
project with what those critics say is untested technology.
"You have a company with no experience building, operating or
maintaining an experimental facility -- with people who have been
part of some very questionable business activities," said Erik
Jensen, who lives in Hidden Springs and has been involved in the
Dynamis meetings.
Mr. Jensen said that DBSI is accused of "a massive financial
fraud" and is the subject of a $2 billion class action lawsuit.
"There needs to be some serious questions asked about this whole
process, because the more information that comes out, the more
concerned I become," Mr. Jensen said.
"I don't believe in guilt by association," Ms. Ullman said,
"because if I did, I'd sure be in the wrong field."
DES MOINES, IA: Seeks Bill to Help Recover Franchise Fee Refund
---------------------------------------------------------------
Jeff Eckhoff, Josh Hafner and James Heggen, writing for
DesMoinesRegister.com, report that the city of Des Moines, facing
a court order to repay up to $40 million for levying an illegal
tax rate on city utility customers, is working with Iowa lawmakers
on legal permission to get the refund money from residents --
through a 50% increase in the tax.
A small portion of budget legislation recently passed in the Iowa
Senate would, if it survives upcoming hurdles, permit the increase
of the franchise fee on Des Moines gas and electric bills from 5
percent to 7 1/2 percent for up to seven years.
The portion of the bill allowing the fee increase does not mention
Des Moines by name. However, it is worded to apply only to a city
that on or after July 1, 2012, "is the subject of a judgment,
court-approved settlement or court-approved compromise providing
for payment of restitution, a refund or a return" of franchise fee
money.
The court order against Des Moines stems from a 2004 class-action
lawsuit challenging the franchise fee's legality. The hotly
fought legal battle so far has generated five bankers' boxes worth
of files, one massive Polk County trial and two trips to the Iowa
Supreme Court.
The most recent appeal ended in March when justices ordered Des
Moines to refund most of what was collected under the fee between
2004 and 2009 -- a period predating the Iowa law that legalized
higher franchise fees and ended what judges have deemed to be an
illegal tax. Lawyers for Lisa Kragnes, the lead plaintiff in the
case, say they're now poring over MidAmerican Energy data to
figure out the math for calculating refunds.
"I'd hate to see it increase again," attorney Brad Schroeder said
of the fee.
A section of the Senate budget bill, passed on May 1 and authored
by state Sen. Matt McCoy, D-Des Moines, would let cities increase
the still-collected fee to 7.5% for no more than seven years but
would require that anything above 5% be used to settle with
litigants. Sen. McCoy called the proposal a combined effort
between city and state lawmakers -- a move designed to avoid
burdening property taxpayers with the cost of paying court-ordered
claims.
Franchise fee supporters have argued that the measure is a more
equitable way to pay for city services than property taxes,
because roughly 40% of Des Moines property is owned by governments
or other tax-exempt agencies.
"In essence, this would more evenly divide the responsibility
between the for-profit, residential and commercial base and the
not-for-profit community to repay this obligation that the courts
have found we are responsible for," Sen. McCoy said.
Des Moines City Councilman Chris Coleman said the proposal echoes
the wishes of Des Moines citizens who told him they prefer a fee
hike over a tax increase.
"I would say everything that's happened this session has
certainly, on the property tax -- all of this is intertwined with
city finances," Mr. Coleman said. "I think we're well-regarded
for responding in a responsible and legal manner."
Mr. Schroeder, the attorney for plaintiff Kragnes, said a more
appropriate way to pay for the refunds would be to simply reduce
the city's spending. He said the city spent money it didn't have
in 2004 and is now playing catch-up.
"They created a reliance on those funds and we told them not to,"
he said. Mr. Schroeder said Sen. McCoy "is trying to make the
best of a bad situation."
"I think it's unfortunate it's come to this," Mr. Schroeder said.
It was not immediately clear where the Kragnes lawsuit stands.
The case returned to Polk County last month after Iowa Supreme
Court justices shot down an attempt by Des Moines to have them
reconsider the case.
The next step, barring a possible appeal by the city to the U.S.
Supreme Court, would require court proceedings to determine the
size of refunds and how money should be distributed.
Senior Judge Joel Novak, the last judge to hear the case before
the appeal was launched, reportedly has expressed interest in
continuing with it, but it's not certain what his involvement will
be. Judge Novak moved to a semi-retired status last year.
E.I. DUPONT: Discovery in Ohio Drinking Water Suit Still Ongoing
----------------------------------------------------------------
Discovery in an Ohio lawsuit commenced by Little Hocking Water
Association alleging drinking water contamination is still
ongoing, E. I. du Pont de Nemours and Company disclosed in its
April 24, 2012, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended March 31, 2012.
In August 2001, a class action, captioned Leach v DuPont, was
filed in West Virginia state court alleging that residents living
near the Washington Works facility had suffered, or may suffer,
deleterious health effects from exposure to perfluorooctanoic acid
and its salts ("PFOA") in drinking water.
DuPont and attorneys for the class reached a settlement in 2004
that binds about 80,000 residents. In 2005, DuPont paid the
plaintiffs' attorneys' fees and expenses of $23 million and made a
payment of $70 million, which class counsel designated to fund a
community health project. The Company is also funding a series of
health studies by an independent science panel of experts (the "C8
Science Panel") in the communities exposed to PFOA to evaluate
available scientific evidence on whether any probable link exists,
as defined in the settlement agreement, between exposure to PFOA
and human disease. The Company expects the C8 Science Panel to
complete these health studies through July 2012 at a total
estimated cost of $33 million.
In December 2011, the C8 Science Panel concluded that there is a
probable link, as defined in the settlement agreement, between
exposure to PFOA and pregnancy-induced hypertension, which
includes preeclampsia. In April 2012, the C8 Science Panel
announced its probable link determinations regarding cancer and
adult onset diabetes. The C8 Science Panel found a probable link
between exposure to PFOA and two categories of cancer (kidney and
testicular). A panel of medical experts will determine an
appropriate medical monitoring protocol, if any, as a result of
these findings. If a medical monitoring protocol for any of these
diseases is defined, DuPont is required to fund a medical
monitoring program to pay for such medical testing. Plaintiffs
may pursue personal injury claims against DuPont only for those
human disease(s) for which the C8 Science Panel determines a
probable link exists once the C8 Science Panel completes its work.
In January 2012, the Company put $1 million in an escrow account
as required by the settlement agreement. The Company will
reassess its liability based on the medical monitoring panel's
determination since costs are not reasonably estimable until a
medical monitoring protocol, if any, is identified. The Company
will continue to reassess its liability based on the C8 Science
Panel's future probable link findings, if any, and associated
medical monitoring protocols, if any. Under the settlement
agreement, the Company's total obligation to pay for medical
monitoring cannot exceed $235 million. In addition, the Company
must continue to provide state-of-the-art water treatment systems
designed to reduce the level of PFOA in water to six area water
districts, including the Little Hocking Water Association (LHWA),
and private well users.
An Ohio action brought by the LHWA is currently in discovery. In
addition to general claims of PFOA contamination of drinking
water, the action claims "imminent and substantial endangerment to
health and or the environment" under the Resource Conservation and
Recovery Act (RCRA). DuPont denies these claims and is defending
itself vigorously.
While DuPont believes that it is reasonably possible that it could
incur losses related to PFOA matters in addition to those pending
matters for which it has established accruals, a range of such
losses, if any, cannot be reasonably estimated at this time.
E.I. DUPONT: Recorded $225-Mil. Charge for Imprelis(R) Claims
-------------------------------------------------------------
E. I. du Pont de Nemours and Company disclosed in its April 24,
2012, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2012, that it had
recorded charges of $225 million related to claims over
Imprelis(R).
The company has received claims and been served with multiple
lawsuits, including lawsuits seeking class action status, alleging
that the use of Imprelis(R) herbicide caused damage to certain
trees. The majority of the lawsuits seeking class actions have
been consolidated in federal court in Philadelphia, Pennsylvania.
In August 2011, the company suspended sales of Imprelis(R) and in
September began a process to fairly resolve claims associated with
the use of Imprelis(R). The deadline for property owners to file
claims was February 1, 2012, although DuPont continues to receive
claims at a significantly reduced rate which it expects to
consider as part of the claims resolution process. However, the
Company believes that the number of unasserted claims, if any, is
limited due to the fact that sales were suspended in August 2011
and the product was last applied during the 2011 spring
application season.
The Company has established review processes to verify and
evaluate damage claims. There are several variables that impact
the evaluation process including the number of trees on a
property, the species of tree with reported damage, the height of
the tree, the extent of damage and the possibility for trees to
naturally recover over time. Upon receiving claims, DuPont
verifies their accuracy and validity which often requires physical
review of the property.
At March 31, 2012, DuPont had recorded charges of $225 million
related to the Imprelis(R) matter, which included a $50 million
charge recorded during the first quarter 2012. It is reasonably
possible that additional charges could result related to this
matter. While there is a high degree of uncertainty, total
charges could range as high as $575 million. DuPont intends to
seek recovery from its insurance carriers for costs associated
with this matter in excess of $100 million.
ERESEARCH TECHNOLOGY: Being Sold to Genstar for Too Little
----------------------------------------------------------
Courthouse News Service reports that EResearch Technology is
selling itself too cheaply to Genstar, as the company's stock
price has doubled in the last six months, a class claims in court.
A copy of the Complaint in Heimowitz v. eResearchTechnology, Inc.,
et al., Case No. 120500568 (Pa. C.P. Ct.), is available at:
http://www.courthousenews.com/2012/05/10/genstar.pdf
The Plaintiff is represented by:
Deborah R. Gross, Esq.
LAW OFFICES BERNARD M. GROSS, P.C.
Suite 450, John Wanamaker Building,
100 Penn Square East
Philadelphia, PA 19107
Telephone: (215) 561-3600
- and -
Samuel H. Rudman, Esq.
Joseph Russello, Esq.
Mark S. Reich, Esq.
Christopher M. Barrett, Esq.
ROBBINS GELLER RUDMAN & DOWD LLP
58 South Service Road, Suite 200
Melville, NY 11747
Telephone: (631) 367-7100
FOCUS MEDIA: Consolidated Suit Dismissal Appeal Remains Pending
---------------------------------------------------------------
An appeal from the dismissal of a consolidated class action
lawsuit against Focus Media Holding Limited remains pending,
according to the Company's April 24, 2012, Form 20-F/A filing with
the U.S. Securities and Exchange Commission for the year ended
December 31, 2010.
On November 27, 2007, Eastriver Partners, Inc. filed a purported
class action lawsuit in the United States District Court for the
Southern District of New York against the Company and the
underwriters of its follow-on offering of November 2007. On
December 21, 2007, Scott Bauer filed a purported class action
lawsuit in the United States District Court for the Southern
District of New York against the Company, certain of its officers
and directors, and the underwriters of the Company's follow-on
offering of November 2007. Both complaints allege that the
Company's registration statement on Form F-1 on November 1, 2007,
as amended, and the related prospectus contained inaccurate
statements of material fact. On April 24, 2008, the court
consolidated the Eastriver Partners, Inc. and Scott Bauer actions
into an action captioned In re Focus Media Holding Limited
Litigation and named Iron Workers Local No. 25 Pension Fund as
lead plaintiff in the consolidated action. On June 23, 2008, Lead
Plaintiff filed a consolidated amended complaint. Specifically,
the complaints allege that the Company failed to disclose reduced
gross margins in its Internet advertising business division due to
acquisitions it made. The complaint filed by Scott Bauer also
alleges that the Company issued a press release concerning its
second quarter 2007 financial results that contained inaccurate
statements of material fact.
On September 5, 2008, the Company, certain of its officers and
directors, and the underwriters filed a motion to dismiss the
consolidated amended complaint. On November 5, 2008, the lead
plaintiff filed its opposition to the motion to dismiss. A reply
brief was filed on December 5, 2008. On March 29, 2010, the court
issued an opinion granting the Company's motion to dismiss. On
March 30, 2010, the court entered a judgment dismissing the case.
The plaintiffs filed a notice of appeal on April 29, 2010,
appealing the judgment granting the Company's motion to dismiss.
The Company says it intends to continue to defend against these
lawsuits vigorously as it believes it has meritorious defenses to
the claims alleged. However, there can be no assurance that the
Company will prevail in the lawsuit on appeal and any adverse
outcome of these cases could have a material adverse effect on the
Company's business or results of operations.
FOCUS MEDIA: To Defend "Palny" Class Suit in New York
------------------------------------------------------
Focus Media Holding Limited says it will defend itself from a
class action lawsuit commenced by Tom Palny in New York, according
to the Company's April 24, 2012, Form 20-F/A filing with the U.S.
Securities and Exchange Commission for the year ended December 31,
2010.
On December 12, 2011, Plaintiff Tom Palny filed a putative class
action lawsuit in the United States District Court for the
Southern District of New York against the Company and certain of
its current or former officers and directors. The complaint
relates to certain allegations made by the firm Muddy Waters about
the Company in a series of releases in November 2011, and alleges
that the Company's public filings, including the Company's 2006,
2007, 2008, 2009 and 2010 Form 20-Fs, the Form F-1 and Prospectus
filed in connection with the Company's November 2007 secondary
offering, and the Q3 2011 earnings press release, contain material
misstatements and omissions. The complaint's allegations,
include, but are not limited to, alleged misrepresentations
relating to the Company's acquisition, write-down and divestiture
of certain assets (including, without limitation, Allyes
Information Technology Company Limited
Shanghai OOH Advertisement Co., Ltd. and other PRC subsidiaries
under Hua Kuang (collectively referred to as "OOH"), and certain
mobile handset companies), and the size and composition of the
Company's LCD display network. Defendants have not yet been
served with the complaint.
The Company says it intends to defend against this lawsuit
vigorously as it believes it has meritorious defenses to the
claims alleged. However, there can be no assurance that the
Company will prevail in the lawsuit and any adverse outcome could
have a material adverse effect on its business or results of
operations.
GROUPON: Securities Class Action Lead Plaintiff Deadline Nears
--------------------------------------------------------------
Hagens Berman Sobol Shapiro LLP, an investor-rights law firm,
reminds investors that four weeks remain before the June 4, 2012,
lead plaintiff deadline in a securities class action filed against
Groupon on behalf of investors. Any member of the putative class
may move the court to serve as lead plaintiff through counsel of
their choice, or may choose to do nothing and remain an absent
class member. The deadline to move the court for lead plaintiff
is June 4, 2012.
Hagens Berman's lawsuit, filed April 16, 2012, in the United
States District Court for the Northern District of Illinois,
alleges that Groupon, certain of its officers, directors and
underwriters of Groupon's Initial Public Offering (IPO) violated
the federal securities laws by issuing false and misleading
statements to investors. The complaint alleges that these
statements artificially inflated the price of Groupon's stock.
Hagens Berman's lawsuit alleges that Groupon and its underwriters
failed to disclose negative trends in the company's business and
weakness in its internal financial controls, causing its stock to
trade at artificially high prices during the Class Period.
Investors who purchased or otherwise acquired shares of Groupon
stock between November 4, 2011, and March 30, 2012, and who have
suffered substantial financial losses are encouraged to contact
Hagens Berman Partner Reed Kathrein by calling (510) 725-3000.
Investors may also contact the firm via e-mail at GRPN@hbsslaw.com
or by visiting http://www.hbsslaw.com/GRPN
Groupon went public in November 2011 at an initial price of $20.00
per share, rising as high as $27.78 during the Class Period.
On March 30, 2012, Groupon shocked the market with an announcement
that it would revise its fourth quarter, 2011 financial results.
The revision, the company said, would include a reduction in
revenue and an increase in operating expenses. Groupon also
noted, "In conjunction with the completion of the audit of
Groupon's financial statements for the year ended December 31,
2011 by its independent auditor, Ernst & Young LLP, the Company
included a statement of a material weakness in its internal
controls over its financial statement close process in its Annual
Report on Form 10-K for year ended December 31, 2011."
Following the announcement, Groupon's stock declined sharply,
losing nearly 17 percent of its value on April 2, 2012, closing at
$15.27. Groupon closed at $9.97 on May 4, 2012.
Groupon announced last week that it would replace two board
members. Starbucks CEO Howard Schultz will leave the board well
before the end of his term and his seat will be filled by Daniel
Henry, CFO of American Express. Kevin Efrusy will also leave
Groupon's board and will be replaced by former Deloitte Vice-
chairman Robert Bass. One commentator stated that it "looks a lot
like an attempt to put some grownups in control of things."
Despite the news, Groupon stock continues to trade below class
period highs.
About Hagens Berman
Hagens Berman Sobol Shapiro LLP -- http://www.hbsslaw.com-- is an
investor-rights class-action law firm with offices in 10 cities.
The firm represents whistleblowers, workers and consumers in
complex litigation.
HALLIBURTON CO: Awaits Ruling on Motion to Appeal Class Cert.
-------------------------------------------------------------
Halliburton Company is awaiting a court decision on its petition
for leave to appeal an order certifying a class in a consolidated
lawsuit alleging violations of federal securities laws, according
to the Company's April 24, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended
March 31, 2012.
In June 2002, a class action lawsuit was filed against the Company
in federal court alleging violations of the federal securities
laws after the SEC initiated an investigation in connection with
the Company's change in accounting for revenue on long-term
construction projects and related disclosures. In the weeks that
followed, approximately twenty similar class actions were filed
against the Company. Several of those lawsuits also named as
defendants several of the Company's present or former officers and
directors. The class action cases were later consolidated, and
the amended consolidated class action complaint, styled Richard
Moore, et al. v. Halliburton Company, et al., was filed and served
upon the Company in April 2003. As a result of a substitution of
lead plaintiffs, the case was styled Archdiocese of Milwaukee
Supporting Fund (AMSF) v. Halliburton Company, et al. AMSF has
changed its name to Erica P. John Fund, Inc. (the Fund). The
Company settled with the SEC in the second quarter of 2004.
In June 2003, the lead plaintiffs filed a motion for leave to file
a second amended consolidated complaint, which was granted by the
court. In addition to restating the original accounting and
disclosure claims, the second amended consolidated complaint
included claims arising out of the Company's 1998 acquisition of
Dresser Industries, Inc., including that the Company failed to
timely disclose the resulting asbestos liability exposure.
In April 2005, the court appointed new co-lead counsel and named
the Fund the new lead plaintiff, directing that it file a third
consolidated amended complaint and that the Company file its
motion to dismiss. The court held oral arguments on that motion
in August 2005. In March 2006, the court entered an order in
which it granted the motion to dismiss with respect to claims
arising prior to June 1999 and granted the motion with respect to
certain other claims while permitting the Fund to re-plead some of
those claims to correct deficiencies in its earlier complaint. In
April 2006, the Fund filed its fourth amended consolidated
complaint. The Company filed a motion to dismiss those portions
of the complaint that had been re-pled. A hearing was held on
that motion in July 2006, and in March 2007 the court ordered
dismissal of the claims against all individual defendants other
than the Company's Chief Executive Officer (CEO). The court
ordered that the case proceed against the Company and its CEO.
In September 2007, the Fund filed a motion for class
certification, and the Company's response was filed in November
2007. The district court held a hearing in March 2008, and issued
an order November 3, 2008, denying the motion for class
certification. The Fund appealed the district court's order to
the Fifth Circuit Court of Appeals. The Fifth Circuit affirmed
the district court's order denying class certification. On
May 13, 2010, the Fund filed a writ of certiorari in the United
States Supreme Court. In early January 2011, the Supreme Court
granted the writ of certiorari and accepted the appeal. The Court
heard oral arguments in April 2011 and issued its decision in June
2011, reversing the Fifth Circuit ruling that the Fund needed to
prove loss causation in order to obtain class certification. The
Court's ruling was limited to the Fifth Circuit's loss causation
requirement, and the case was returned to the Fifth Circuit for
further consideration of the Company's other arguments for denying
class certification.
The Fifth Circuit returned the case to the district court, and in
January 2012 the court issued an order certifying the class; the
Company has filed a Petition for Leave to Appeal with the Fifth
Circuit.
The Company says the case is at an early stage, and it cannot
predict the outcome or consequences thereof. As of March 31,
2012, the Company had not accrued any amounts related to this
matter because it does not believe that a loss is probable.
Further, an estimate of possible loss or range of loss related to
this matter cannot be made. The Company intends to vigorously
defend this case.
HALLIBURTON CO: RCRA Claims Over Duncan Operations Dismissed
------------------------------------------------------------
Claims under the U.S. Resource Conservation and Recovery Act in
the lawsuits arising from Halliburton Company's Duncan, Oklahoma
facility were dismissed in April 2012, but other claims remain
pending, according to the Company's April 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2012.
Commencing in October 2011, a number of lawsuits were filed
against the Company, including a putative class action case in
federal court in the Western District of Oklahoma and other
lawsuits filed in Oklahoma state courts. The lawsuits generally
allege, among other things, that operations at the Company's
Duncan facility caused releases of pollutants, including ammonium
perchlorate and, in the case of the federal lawsuit, nuclear or
radioactive waste, into the groundwater, and that the Company knew
about those releases and did not take corrective actions to
address them. It is also alleged that the plaintiffs have
suffered from certain health conditions, including hypothyroidism,
a condition that has been associated with exposure to perchlorate
at sufficiently high doses over time. These cases seek, among
other things, damages, including punitive damages, and the
establishment of a fund for future medical monitoring. The cases
allege, among other things, strict liability, trespass, private
nuisance, public nuisance, and negligence and, in the case of the
federal lawsuit, violations of the U.S. Resource Conservation and
Recovery Act (RCRA), resulting in personal injuries, property
damage, and diminution of property value.
The lawsuits generally allege that the cleaning of the missile
casings at the Duncan facility contaminated the surrounding soils
and groundwater, including certain water wells used in a number of
residential homes, through the migration of, among other things,
ammonium perchlorate. The federal lawsuit also alleges that the
Company's processing of radioactive waste from a nuclear power
plant over 25 years ago resulted in the release of
"nuclear/radioactive" waste into the environment. In April 2012,
the judge in the federal lawsuit dismissed the plaintiffs' RCRA
claim. The other claims brought in that lawsuit remain pending.
The Company and the Oklahoma Department of Environmental Quality
(DEQ) have conducted soil and groundwater sampling relating to the
allegations that has confirmed that the alleged nuclear or
radioactive material is confined to the soil in a discrete area of
the onsite operations and is not presently believed to be in the
groundwater onsite or in any areas offsite. The radiological
impacts from this discrete area are not believed to present any
health risk for offsite exposure. With respect to ammonium
perchlorate, the Company has made arrangements to supply affected
residents with bottled drinking water and, if needed, with a
temporary water supply system, at no cost to the residents. The
Company has worked with the City of Duncan and the DEQ to expedite
expansion of the city water supply to the relevant areas at the
Company's expense.
The lawsuits are at an early stage, and additional lawsuits and
proceedings may be brought against the Company. The Company
cannot predict their outcome or the consequences thereof. As of
March 31, 2012, the Company had accrued $32 million related to its
initial estimate of response efforts, third-party property damage,
and remediation related to the Duncan, Oklahoma matter. The
Company intends to vigorously defend the lawsuits and does not
believe that these lawsuits will have a material adverse effect on
its liquidity, consolidated results of operations, or consolidated
financial condition.
HALLIBURTON CO: Two Settlements in Macondo MDL Filed in April
-------------------------------------------------------------
Two settlement agreements were filed in April 2012 to resolve
claims in the multidistrict litigation arising from the Macondo
well incident, according to Halliburton Company's April 24, 2012,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2012.
The semisubmersible drilling rig, Deepwater Horizon, sank on April
22, 2010, after an explosion and fire onboard the rig that began
on April 20, 2010. The Deepwater Horizon was owned by Transocean
Ltd. and had been drilling the Macondo exploration well in
Mississippi Canyon Block 252 in the Gulf of Mexico for BP
Exploration & Production, Inc. (BP Exploration), the lease
operator and indirect wholly owned subsidiary of BP p.l.c. (BP
p.l.c., BP Exploration, and their affiliates, collectively, BP).
There were eleven fatalities and a number of injuries as a result
of the Macondo well incident. Crude oil escaping from the Macondo
well site spread across thousands of square miles of the Gulf of
Mexico and reached the United States Gulf Coast. The Company
performed a variety of services for BP Exploration, including
cementing, mud logging, directional drilling, measurement-while-
drilling, and rig data acquisition services.
Since April 21, 2010, plaintiffs have been filing lawsuits
relating to the Macondo well incident. Generally, those lawsuits
allege either (1) damages arising from the oil spill pollution and
contamination (e.g., diminution of property value, lost tax
revenue, lost business revenue, lost tourist dollars, inability to
engage in recreational or commercial activities) or (2) wrongful
death or personal injuries. The Company is named along with other
unaffiliated defendants in more than 400 complaints, most of which
are alleged class actions, involving pollution damage claims and
at least nine personal injury lawsuits involving four decedents
and at least 21 allegedly injured persons who were on the drilling
rig at the time of the incident. Another six lawsuits naming the
Company and others relate to alleged personal injuries sustained
by those responding to the explosion and oil spill. Plaintiffs
originally filed the lawsuits in federal and state courts
throughout the United States, including Alabama, Delaware,
Florida, Georgia, Kentucky, Louisiana, Mississippi, South
Carolina, Tennessee, Texas, and Virginia. Except for certain
lawsuits not yet consolidated (including two lawsuits that are
proceeding in Louisiana state court, one lawsuit that is
proceeding in Texas state court, one lawsuit that is proceeding in
Texas federal court, one lawsuit that is proceeding in Florida
federal court, and four lawsuits in Florida state court for which
the Company has not been served), the Judicial Panel on Multi-
District Litigation ordered all of the lawsuits against the
Company consolidated in the MDL proceeding before Judge Carl
Barbier in the United States Eastern District of Louisiana. The
pollution complaints generally allege, among other things,
negligence and gross negligence, property damages, taking of
protected species, and potential economic losses as a result of
environmental pollution and generally seek awards of unspecified
economic, compensatory, and punitive damages, as well as
injunctive relief. Plaintiffs in these pollution cases have
brought lawsuit under various legal provisions, including The Oil
Pollution Act of 1990 (OPA), The Clean Water Act (CWA), The
Migratory Bird Treaty Act of 1918 (MBTA), the Endangered Species
Act of 1973 (ESA), the Outer Continental Shelf Land, general
maritime law, state common law, and various state environmental
and products liability statutes.
Furthermore, the pollution complaints include lawsuits brought
against the Company by governmental entities, including the State
of Alabama, the State of Louisiana, Plaquemines Parish, the City
of Greenville, and three Mexican states. Complaints brought
against the Company by ten other parishes in Louisiana were
dismissed with prejudice, and the dismissal is being appealed by
those parishes. The wrongful death and other personal injury
complaints generally allege negligence and gross negligence and
seek awards of compensatory damages, including unspecified
economic damages and punitive damages. The Company has retained
counsel and is investigating and evaluating the claims, the
theories of recovery, damages asserted, and its respective
defenses to all of these claims.
Judge Barbier is also presiding over a separate proceeding filed
by Transocean under the Limitation of Liability Act (Limitation
Action). In the Limitation Action, Transocean seeks to limit its
liability for claims arising out of the Macondo well incident to
the value of the rig and its freight. Although the Limitation
Action is not consolidated in the MDL, to this point the judge is
effectively treating the two proceedings as associated cases. On
February 18, 2011, Transocean tendered the Company, along with all
other defendants, into the Limitation Action. As a result of the
tender, the Company and all other defendants will be treated as
direct defendants to the plaintiffs' claims as if the plaintiffs
had sued each of the Company and the other defendants directly.
In the Limitation Action, the judge intends to determine the
allocation of liability among all defendants in the hundreds of
lawsuits associated with the Macondo well incident, including
those in the MDL proceeding that are pending in his court.
Specifically, the judge will determine the liability, limitation,
exoneration and fault allocation with regard to all of the
defendants in a trial, which is scheduled to occur in three
phases, that was set to begin in late February 2012 but has been
adjourned in connection with the settlement between BP and MDL
Plaintiffs' Steering Committee (PSC). The three phases of this
portion of the trial are scheduled to cover the liabilities
associated with the blowout itself, the actions relating to the
attempts to control the flow of hydrocarbons from the well, and
the efforts to contain and clean-up the oil that was discharged
from the Macondo well. The Company does not believe that a single
apportionment of liability in the Limitation Action is properly
applied, particularly with respect to gross negligence and
punitive damages, to the hundreds of lawsuits pending in the MDL
proceeding. The settlement between BP and the PSC would likely
result in a realignment of the parties in the MDL and require
substantial changes to the first phase of the trial plan.
Damages for the cases tried in the MDL proceeding, including
punitive damages, are expected to be tried following the three-
phase portion of the trial. Under ordinary MDL procedures, such
cases would, unless waived by the respective parties, be tried in
the courts from which they were transferred into the MDL. It
remains unclear, however, what impact the overlay of the
Limitation Action will have on where these matters are tried.
Document discovery and depositions among the parties to the MDL
are ongoing. It is unclear how the judge will address the DOJ's
civil action for alleged violations of the CWA and the OPA.
In April and May 2011, certain defendants in the proceedings filed
numerous cross claims and third party claims against certain other
defendants. BP Exploration and BP America Production Company
filed claims against the Company seeking subrogation and
contribution, including with respect to liabilities under the OPA,
and direct damages, and alleging negligence, gross negligence,
fraudulent conduct, and fraudulent concealment. Transocean filed
claims against the Company seeking indemnification, and
subrogation and contribution, including with respect to
liabilities under the OPA and for the total loss of the Deepwater
Horizon, and alleging comparative fault and breach of warranty of
workmanlike performance. Anadarko filed claims against the Company
seeking tort indemnity and contribution, and alleging negligence,
gross negligence and willful misconduct, and MOEX Offshore 2007
LLC (MOEX), who has an approximate 10% interest in the Macondo
well, filed a claim against the Company alleging negligence.
Cameron International Corporation (Cameron) (the manufacturer and
designer of the blowout preventer), M-I Swaco (provider of
drilling fluids and services, among other things), Weatherford
U.S. L.P. and Weatherford International, Inc. (together,
Weatherford) (providers of casing components, including float
equipment and centralizers, and services), and Dril-Quip, Inc.
(Dril-Quip) (provider of wellhead systems), each filed claims
against the Company seeking indemnification and contribution,
including with respect to liabilities under the OPA in the case of
Cameron, and alleging negligence. Additional civil lawsuits may
be filed against the Company. In addition to the claims against
the Company, generally the defendants in the proceedings filed
claims, including for liabilities under the OPA and other similar
claims, against the other defendants. BP has since announced that
it has settled those claims between it and each of MOEX,
Weatherford, Anadarko, and Cameron. The Company also understands
that BP and M-I Swaco have agreed to dismiss all claims between
them.
In April 2011, the Company filed claims against BP Exploration, BP
p.l.c. and BP America Production Company (BP Defendants), M-I
Swaco, Cameron, Anadarko, MOEX, Weatherford, Dril-Quip, and
numerous entities involved in the post-blowout remediation and
response efforts, in each case seeking contribution and
indemnification and alleging negligence. The Company's claims
also alleged gross negligence and willful misconduct on the part
of the BP Defendants, Anadarko, and Weatherford. The Company also
filed claims against M-I Swaco and Weatherford for contractual
indemnification, and against Cameron, Weatherford and Dril-Quip
for strict products liability, although the court has since issued
orders dismissing all claims asserted against Dril-Quip and
Weatherford in the MDL. The Company filed its answer to
Transocean's Limitation petition denying Transocean's right to
limit its liability, denying all claims and responsibility for the
incident, seeking contribution and indemnification, and alleging
negligence and gross negligence.
Judge Barbier has issued an order, among others, clarifying
certain aspects of law applicable to the lawsuits pending in his
court. The court ruled that: (1) general maritime law will apply
and therefore dismissed all claims brought under state law causes
of action; (2) general maritime law claims may be brought directly
against defendants who are non-"responsible parties" under the OPA
with the exception of pure economic loss claims by plaintiffs
other than commercial fishermen; (3) all claims for damages,
including pure economic loss claims, may be brought under the OPA
directly against responsible parties; and (4) punitive damage
claims can be brought against both non-responsible parties under
general maritime law and responsible parties under the OPA. As
discussed, with respect to the ruling that claims for damages may
be brought under the OPA against responsible parties, the Company
has not been named as a responsible party under the OPA, but BP
Exploration has filed a claim against the Company for contribution
with respect to liabilities incurred by BP Exploration under the
OPA.
In September 2011, the Company filed claims in Harris County,
Texas, against the BP Defendants seeking damages, including lost
profits and exemplary damages, and alleging negligence, grossly
negligent misrepresentation, defamation, common law libel,
slander, and business disparagement. The Company's claims allege
that the BP Defendants knew or should have known about an
additional hydrocarbon zone in the well that the BP Defendants
failed to disclose to the Company prior to its designing the
cement program for the Macondo well. The location of the
hydrocarbon zones is critical information required prior to
performing cementing services and is necessary to achieve desired
cement placement. The Company believes that had the BP Defendants
disclosed the hydrocarbon zone to it, the Company would not have
proceeded with the cement program unless it was redesigned, which
likely would have required a redesign of the production casing.
In addition, the Company believes that the BP Defendants withheld
this information from the BP Report and from various
investigations. In connection with the foregoing, the Company
also moved to amend its claims against the BP Defendants in the
MDL proceeding to include fraud. The BP Defendants have denied
all of the allegations relating to the additional hydrocarbon zone
and filed a motion to prevent the Company from adding its fraud
claim in the MDL. In October 2011, the Company's motion to add
the fraud claim against the BP Defendants in the MDL proceeding
was denied. The court's ruling does not, however, prevent the
Company from using the underlying evidence in its pending claims
against the BP Defendants.
In December 2011, BP filed a motion for sanctions against the
Company alleging, among other things, that the Company destroyed
evidence relating to post-incident testing of the foam cement
slurry on the Deepwater Horizon and requesting adverse findings
against the Company. A magistrate judge in the MDL proceeding
denied BP's motion. BP appealed that ruling, and Judge Barbier
affirmed the magistrate judge's decision.
In April 2012, BP announced that it had reached definitive
settlement agreements with the PSC to resolve the substantial
majority of eligible private economic loss and medical claims
stemming from the Macondo well incident. The PSC acts on behalf
of individuals and business plaintiffs in the MDL. BP has
estimated that the cost of the pending settlement would be
approximately $7.8 billion, including administration costs and
plaintiffs' attorneys' fees and expenses, and stated that it is
possible the actual cost could be higher or lower. According to
BP, the proposed settlement does not include claims against BP
made by the DOJ or other federal agencies or by states and local
governments. In addition, BP has stated that the proposed
settlement provides that, to the extent permitted by law, BP will
assign to the PSC certain of its claims, rights and recoveries
against Transocean and the Company for damages not recoverable
from BP. The Company does not believe that its contract with BP
Exploration permits the assignment of certain claims to the PSC
without its consent.
On April 18, 2012, BP and the PSC filed two settlement agreements
with the MDL court, one addressing economic claims and one
addressing medical claims, as well as numerous supporting
documents and motions requesting that the court approve, among
other things, the certification of the classes for both
settlements and a schedule for holding a fairness hearing and
approving the settlements. The schedule as proposed would require
that any objections to the settlements be filed by the end of
August 2012, with fairness hearings to begin in November 2012. BP
has also asked the MDL court to continue the adjournment of the
MDL trial until after the court determines whether to grant final
approval of the settlement agreements. The Company is continuing
to review the settlement agreements and related documents, and is
unable to predict at this time the effect that the settlements may
have on claims against it.
The Company says it intends to vigorously defend any litigation,
fines, and/or penalties relating to the Macondo well incident and
to vigorously pursue any damages, remedies, or other rights
available to it as a result of the Macondo well incident. The
Company has incurred and expects to continue to incur significant
legal fees and costs, some of which it expects to be covered by
indemnity or insurance, as a result of the numerous investigations
and lawsuits relating to the incident.
IU HOSPITAL: Uninsured Patients Sue Over "Chargemaster" Rate
------------------------------------------------------------
Kent Erdahl, writing for WSBT, reports that two uninsured patients
are about to go before the Indiana Supreme Court to argue they
were billed unfairly by the state's largest hospital system. If
the case moves forward, it could open the door for a class-action
lawsuit.
According to the case, Abby Allen and Walter Moore sought
treatment at Clarian Hospital North (now IU Hospital North) and
they were billed at the "chargemaster" rate, which is more than
the amount paid by insurance companies.
"We found that they were being charged twice, or three times, or
four times as much as they would have been charged if their
insurance kicked in," said Scott Weathers, one of several
attorney's representing the clients.
Attorney Scott Weathers said Ms. Allen visited IU North in 2008
for an infection and she was billed at the "chargemaster" rate,
which was more than $15,641. Mr. Weathers said an insured patient
would have been charged just $7,308.
Mr. Weathers said his clients signed consent forms promising to
pay for their medical care, but he argues that the hospital system
didn't give any indication of an amount. Indiana common law
requires contracts must be "reasonable" if they don't provide a
price.
Mr. Weathers said the hospital bills for his clients, and anyone
else billed at "chargemaster" rates were not "reasonable." That's
also why he's pursuing class-action status.
"We sued on behalf of all people who have been charged that rate
for the last 10 years," Mr. Weathers said.
IU Health isn't commenting on the specific billing questions at
the center of the case.
The hospital system did begin charging the uninsured up to 40
percent less than the "chargemaster" rate last year, in order to
comply with the new Affordable Care Act.
In a statement, spokeswoman Lauren Cislak said, "IU Health treats
all patients, regardless of their ability to pay. Now and prior
to when the ACA was enacted, we proactively work with patients if
they need financial assistance."
Mr. Weathers argues that uninsured patients may not need that
assistance, if they had been simply charged a lesser rate in the
first place.
"The ramifications of charging all of these uninsured (patients)
these high rates, there's a lot of medical bankruptcy, there's a
credit problem," Mr. Weathers said. "If they charge a reasonable
rate I think a lot more underinsured (patients) could maybe pay
the bill."
LIFEWAY KEFIR: Faces Class Action Over False Claims on Yoghurt
--------------------------------------------------------------
Lorraine Bailey at Courthouse News Service reports that a class
action claims that Lifeway Kefir, a probiotic yogurt-like
beverage, contains little to none of the probiotic microorganisms
that Lifeway boasts are "clinically proven" to improve digestive
health.
Lifeway produces and sells kefir, a cultured probiotic beverage
similar to drinkable yoghurt, sometimes called the "champagne of
dairy." All Lifeway products contain seven to ten billion culture
forming units of 10 strains of bacteria, plus ProBoost, "our
exclusive pair of clinically proven probiotics to balance your
body's ecosystem, [and] support digestive health and immunity,"
according to the company's Web site.
But Scott Keatley and Joseph Villari, who filed a class action
against Lifeway Foods Inc. in the Northern District of Illinois,
dispute the company's claims about the health benefits of its
kefir.
"Lifeway claims that its products containing ProBoost, including
but not limited to Lifeway's 'Original Kefir,' 'BioKefir,' 'Low
Fat Kefir' and 'Nonfat Kefir,' (collectively, 'ProBoost Products')
will 'enhance the immune system' and 'balance digestive health.'
Specifically, Lifeway claims its ProBoost products will provide
clinically proven therapeutic benefits for various health
conditions, including antibiotic diarrhea, autoimmune disorders,
bad breath, celiac disease, Crohn's and colitis, high cholesterol,
immune deficiency, infantile colic, irritable bowel syndrome,
lactose intolerance, seasonal allergies, traveler's diarrhea and
yeast infections.
"In fact, Lifeway's ProBoost products are not clinically proven to
be effective for the benefits Lifeway represents in its media and
advertising of the ProBoost products. Moreover, the two strains
Lifeway touts in its ProBoost products, Lactobacillus acidophilus
NCFM and Bifidobacterium lactis HN019, which must be at certain
dosage levels to provide any claimed health enhancing benefits,
are not even in the ProBoost Products," the plaintiffs claim.
They say that "testing shows that Lifeway's ProBoost products
contain little to no Lactobacillus acidophilus NCFM and
Bifidobacterium lactis HN019."
The complaint continues: "Nonetheless, as a result of Lifeway's
deceptive advertising campaign, plaintiffs and other customers are
induced into buying the ProBoost products because of the
misrepresentations. Plaintiffs would not have purchased the
ProBoost products had they known the truth regarding the ProBoost
products and the ProBoost products did not have the quality,
health benefits or value as promised."
The class seeks restitution and punitive damages for violation of
the Magnuson-Moss Act, unjust enrichment, breach of warranty,
misrepresentation, fraudulent concealment, and fraud.
A copy of the Complaint in Keatley, et al. v. Lifeway Foods, Inc.,
Case No. 12-cv-03521 (N.D. Ill.), is available at:
http://www.courthousenews.com/2012/05/10/kefir.pdf
The Plaintiffs are represented by:
Mark D. Belongia, Esq.
Richard K. Hellerman, Esq.
Harry O. Channon, Esq.
BELONGIA SHAPIRO, LLP
Two First Financial Plaza
20 South Clark Street, Suite 300
Chicago, IL 60603
Telephone: (312) 662-1030
E-mail: mbelongia@belongialaw.com
hchannon@belongialaw.com
- and -
Antonio Vozzolo, Esq.
Jamie R. Mogil, Esq.
FARUQI & FARUQI, LLP
369 Lexington Avenue, 10th Floor
New York, NY 10017
Telephone: (212) 983-9330
E-mail: avozzolo@faruqilaw.com
jmogil@faruqilaw.com
MCKENZIE CHECK: Argument on Class Action Arbitration Heard
----------------------------------------------------------
Bill Kaczor, writing for The Associated Press, reports that a pay
day loan company's lawyer argued on May 9 that the Florida Supreme
Court must uphold a contract provision prohibiting customers from
banding together in class action arbitration cases against the
firm because of a 2011 U.S. Supreme Court decision.
The state justices' decision will affect similar clauses widely
used to require customers to sign away their right to sue in
exchange for case-by-case arbitration to resolve potential
allegations that businesses have violated usury, deceptive
practices or other consumer protection laws. The clauses are
designed to avoid costly lawsuits and often include
confidentiality provisions to keep the results from becoming
public.
The state's 4th District Court of Appeal affirmed a trial judge's
invalidation of the class action ban that's in McKenzie Check
Advance's loan contracts. The appellate court ruled borrowers in
Palm Beach County were unable to seek justice because they
couldn't find lawyers willing to pursue individual claims for
relatively small amounts of money in cases involving complex legal
issues.
Circuit Judge Elizabeth Maass ruled the clause was
"unconscionable."
The appellate court also certified a question of great public
important to the Supreme Court: Whether the class action waivers
violate public policy by preventing consumers from obtaining
competent counsel.
The U.S. Supreme Court, though, subsequently struck down a
California law that outlawed arbitration clauses with similar
class action bans.
The 5-4 opinion in the case of AT&T Mobility LLC. v. Concepcion
says the state statute conflicted with a federal law that
encourages arbitration. Federal laws trump conflicting state laws
under the U.S. Constitution's supremacy clause.
"At this point it's not an issue of whether arbitration's good or
bad, but it's an issue of the supremacy clause," said Jamie
Bianchi, a lawyer for McKenzie.
Justice Barbara Pariente acknowledged Ms. Bianchi had a strong
argument.
"It would seem -- and maybe this is sort of a friendly question
for you -- that Concepcion really takes the certified question and
really obviates it," Justice Pariente said. "Right or wrong,
we're bound to follow the U.S. Supreme Court."
"We agree with that, your honor," Ms. Bianchi replied.
Justice Pariente later added, "So much for state's rights, huh?"
F. Paul Bland, a lawyer representing Wendy Betts and other
McKenzie customers, argued the Concepcion ruling does not prevent
the state justices from affirming the 4th District's ruling.
Mr. Bland said the decision did not invalidate prior U.S. Supreme
Court rulings saying consumers must be able to effectively
vindicate their rights.
"A procedure that ends up gutting the rights effectively is enough
to render the clause unenforceable," Mr. Bland said.
Justice Pariente, though, asked how he could argue "with a
straight face" that the U.S. Supreme Court would void the class
action ban simply on the basis of testimony from three consumer
advocate lawyers who said they wouldn't take the McKenzie cases.
Mr. Bland argued they included a legal aid lawyer who offered
broader evidence of being unable to find lawyers willing to take a
large number of cases, some involving military members.
The high court did not indicate when it would rule.
The case is McKenzie Check Advance of Florida LLC, et al. v. Wendy
Betts, et al., SC11-514.
METRA: Faces Class Action Over Ticket Expiration Date Policy
------------------------------------------------------------
Lorraine Bailey at Courthouse News Service reports that an
Illinois commuter sued the rail system serving Chicago and its
surrounding suburbs, arguing that its tickets unlawfully expire
after one year, when state statutes, which lump them with "gift
certificates," require they be good for at least five.
John Divito, individually and on behalf of all others similarly
situated v. Commuter Rail Division of the Regional Transportation
Authority d/b/a Metra, an Illinois municipal corporation, and
Northeast Illinois Regional Commuter Railroad Corporation d/b/a
Metra, a public corporation, Case No. 2012-CH-17230 (Ill. Cir.
Ct., Cook Cty., May 8, 2012) seeks to stop Metra's alleged
unlawful policy and practice of marketing, selling, and collecting
monies for 10-Ride Tickets and One-Way Tickets subject to an
expiration date earlier than five years after the date of
issuance, in violation of the Illinois Consumer Fraud Act.
Mr. DiVito is a resident of city of Roselle, in the county of
DuPage, Illinois.
Together the defendants, which are public corporations, do
business under the trade name "Metra." Under that corporate
umbrella they manage 241 stations and 11 lines running to and from
downtown Chicago.
As part of those activities, the defendants sell monthly passes,
10-Ride Tickets which are good for one year, and One-Way Tickets,
which are valid for 14 days from the date of purchase, according
to the complaint.
Mr. DiVito says he "has purchased at least three different 10-Ride
Tickets in the last three years. All of them are now expired, and
he has only used a handful of the rides on each of the passes.
Therefore, he has paid for services he will never receive because
of Metra's illegal expiration date policy. In other words, Metra
has extracted the cost of thirty rides from Mr. DiVito and only
allowed him to use eleven rides."
He claims that "Metra's limited ride tickets, including 10-Ride
Tickets and One-Way Tickets, all expire in under five years.
While Metra may not call its 10-Ride Tickets or One-Way Tickets
'gift certificates,' that is exactly what they are under the
Illinois Consumer Fraud Act. (ICFA)"
"Metra 10-Ride Tickets and One-Way Tickets are 'records evidencing
a promise, made for consideration, by the seller or issuer of the
record that goods or services will be provided to the holder of
the record for the value shown in the record . . . that is
prefunded and for which the value is decremented upon each use,'"
the complaint states, quoting the ICFA.
"The ICFA requires that gift certificates -- whether or not titled
gift certificates -- expire no earlier than 5 years after the date
of issuance. Accordingly, every sale of a Metra 10-Ride Ticket
and One-Way Tickets violates the ICFA . . ." Mr. DiVito asserts.
He says that, "in effect, sellers -- like Metra -- who set
artificially short redemption periods are planning in advance to
make money by not providing the very services for which buyers
have paid in advance. By doing so, not only do profiteers like
Metra get something for nothing, they also get to earn interest on
the money buyers hand over to them for services never to be
rendered."
Mr. DiVito seeks punitive damages for fraud, breach of contract,
and unjust enrichment, and an injunction preventing the sale of
limited ride tickets with expiration dates of less than five
years.
A copy of the Complaint in DiVito v. Commuter Rail Division of the
Regional Transportation Authority d/b/a Metra, et al., Case No.
12CH17230 (Ill. Cir. Ct., Cook Cty.), is available at:
http://www.courthousenews.com/2012/05/10/metra.pdf
The Plaintiff is represented by:
Michael J. Aschenbrener, Esq.
ASCHENBRENER LAW, P.C.
10 South Riverside Plaza, Suite 1800
Chicago, IL 60606
Telephone: (312) 462-4922
E-mail: mja@aschebrenerlaw.com
RADIOSHACK CORP: Defends Suits Over Song-Beverly Act Violations
---------------------------------------------------------------
In November 2010, RadioShack Corporation received service of
process with respect to the first of four putative class action
lawsuits filed in California (Sosinov v. RadioShack, Los Angeles
Superior Court; Bitter v. RadioShack, Federal District Court,
Central District of California; Moreno v. RadioShack, Federal
District Court, Southern District of California; and Grant v.
RadioShack, San Francisco Superior Court). The plaintiffs in all
of these cases seek damages under California's Song-Beverly Credit
Card Act (the "Act"). Plaintiffs claim that under one section of
the Act, retailers are prohibited from recording certain personal
identification information regarding their customers while
processing credit card transactions unless certain statutory
exceptions are applicable. The Act provides that any person who
violates this section is subject to a civil penalty not to exceed
$250 for the first violation and $1,000 for each subsequent
violation. In each of the cases, plaintiffs allege that the
Company violated the Act by asking them for personal
identification information while processing a credit card
transaction and then recording it.
No further updates were reported in the Company's April 24, 2012,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2012.
The Company says it is defending these cases, but it currently
unable to reasonably estimate the loss, if any, that may result
from them.
RADIOSHACK CORP: Mulls Effect of "Brinker" Decision on "Brookler"
----------------------------------------------------------------
RadioShack Corporation said in its April 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2012, that it is still evaluating the
potential effect of the decision in "Brinker" case on Brookler v.
RadioShack Corporation.
On April 6, 2004, plaintiffs filed a putative class action in Los
Angeles Superior Court, Brookler v. RadioShack Corporation,
claiming that the Company violated California's wage and hour laws
relating to meal and rest periods. The meal period portion of the
case was originally certified as a class action in February 2006.
The Company's first Motion for Decertification of the class was
denied in August 2007. After a favorable decision at the
California Court of Appeals in the similar case of Brinker
Restaurant Corporation v. Superior Court, the Company filed a
second motion for decertification, and in October 2008 the trial
court granted the Company's motion. The plaintiffs in Brookler
appealed this ruling. Due to the unsettled nature of California
law regarding the obligations of employers in respect of meal
periods, the Company and the Brookler plaintiffs requested that
the California Court of Appeals stay its ruling on the plaintiffs'
appeal of the class decertification ruling pending the California
Supreme Court's decision in Brinker.
The appellate court denied this joint motion and then heard oral
arguments in the case on August 5, 2010. On August 26, 2010, the
California Court of Appeals reversed the trial court's
decertification of the class, and the Company's Petition for
Rehearing was denied on September 14, 2010. On September 28,
2010, the Company filed a Petition for Review with the California
Supreme Court, which granted review and placed the case on hold
pending its decision in Brinker.
On April 12, 2012, the California Supreme Court issued its
decision in Brinker. The Company says it is still evaluating the
potential effect of this decision on Brookler.
The Company says the outcome of this case is uncertain and the
ultimate resolution of it could have a material adverse effect on
its consolidated financial statements in the period in which the
resolution is recorded.
RADIOSHACK CORP: Mulls Effect of "Brinker" Ruling on "Ordonez"
--------------------------------------------------------------
RadioShack Corporation is still evaluating the potential effect of
the decision in "Brinker" case on the class action lawsuit
commenced by Daniel Ordonez, according to the Company's April 24,
2012, Form 10-Q filing with the U.S. Securities and Exchange
Commission for the quarter ended March 31, 2012.
In May 2010, Daniel Ordonez, on behalf of himself and all other
similarly situated current and former employees, filed a Complaint
against the Company in the Los Angeles Superior Court. In July
2010, Mr. Ordonez filed an Amended Complaint alleging, among other
things, that the Company failed to provide required meal periods,
provide required rest breaks, pay overtime compensation, pay
minimum wages, and maintain required records. In September 2010,
the Company removed the case to the United States District Court
for the Central District of California. The proposed putative
class in Ordonez consists of all current and former non-exempt
employees for a period within the four (4) years preceding the
filing of the case. The meal period claims raised in Ordonez are
similar to the claims raised in Brookler case. Pursuant to a
motion filed by the Ordonez parties, the court recently granted a
Stipulation and Order to Stay Proceedings pending the decision of
the California Supreme Court in Brinker case.
On April 12, 2012, the California Supreme Court issued its
decision in Brinker.
The Company says it is still evaluating the potential effect of
this decision on Ordonez. The outcome of this case is uncertain
and the ultimate resolution of it could have a material adverse
effect on the Company's consolidated financial statements in the
period in which the resolution is recorded.
RADIOSHACK CORP: Mediation in March Did Not Resolve Ill. Suit
-------------------------------------------------------------
RadioShack Corporation said in its April 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2012, that a mediation session held in
March 2012 did not result in a settlement of a consolidated class
action lawsuit.
On September 26, 2011, Scott D.H. Redman filed a putative class
action lawsuit, captioned Redman v. RadioShack Corporation,
against the Company in the United States District Court for the
Northern District of Illinois. Mr. Redman claims that the Company
violated certain provisions of the Fair and Accurate Credit
Transactions Act of 2003 ("FACTA"), which amended the Fair Credit
Reporting Act, by displaying the expiration dates of the Company's
customers' credit or debit cards on electronically printed
transaction receipts. Mr. Redman filed a motion seeking to
certify a class that includes all persons to whom the Company
provided an electronically printed transaction receipt, in
transactions occurring after June 3, 2008, that displayed the
expiration date of the person's credit or debit card.
On November 3, 2011, Mario Aliano and Vitoria Radavicuite filed a
similar putative class action lawsuit against the Company, also in
the United States District Court for the Northern District of
Illinois, alleging similar violations of FACTA. Mr. Aliano and
Ms. Radaviciute initially filed a motion seeking to certify a
class that includes all persons to whom the Company provided an
electronically printed transaction receipt, in transactions
occurring in Illinois after June 3, 2008, that displayed the
expiration date of the person's credit or debit card. On December
28, 2011, Mr. Aliano and Ms. Radaviciute filed an amended
complaint and an amended motion seeking to certify a class that
was not limited to transactions occurring in Illinois.
On January 11, 2012, the Aliano lawsuit was reassigned to the
judge presiding over the Redman lawsuit on the basis of
relatedness, and the two cases were consolidated for all purposes.
On January 25, 2012, the presiding judge referred the matter to
the magistrate judge assigned to the consolidated cases for
mediation, extended the time by which the Company must respond to
the pending complaints to such time as the magistrate judge shall
order, and is holding the motions for class certification in
abeyance.
A mediation session was held in March 2012. It did not result in
a settlement, and the Company continues to vigorously defend these
cases. The Company says the outcome of these cases is uncertain
and the ultimate resolution of them could have a material adverse
effect on its consolidated financial statements in the period in
which the resolutions are recorded.
RITE AID: Defends Store Managers' Class Suits in Various States
---------------------------------------------------------------
Rite Aid Corporation continues to defend itself from collective
and class action lawsuits brought on behalf of store managers and
assistant store managers, according to the Company's April 24,
2012, Form 10-K filing with the U.S. Securities and Exchange
Commission for the year ended March 3, 2012.
The Company is currently a defendant in several putative
collective or class action lawsuits filed in federal or state
courts in several states, including Pennsylvania, New Jersey, New
York, Maryland, Massachusetts, Maine, New Hampshire, Washington
and Oregon, purportedly on behalf of, in some cases (i) current
and former assistant store managers and co-managers or (ii)
current and former store managers and assistant store managers,
respectively, working in the Company's stores at various
locations. The lawsuits allege violations of the Fair Labor
Standards Act and of certain state wage and hour statutes. The
lawsuits seek various combinations of unpaid compensation
(including overtime compensation), liquidated damages, exemplary
damages, pre-and post-judgment interest as well as attorneys' fees
and costs. In one of the cases, Craig et al v. Rite Aid
Corporation et al, pending in the United States District Court for
the Middle District of Pennsylvania, brought on behalf of current
and former assistant store managers, the Court, on December 9,
2009, conditionally certified a nationwide collective group of
individuals who worked for the Company as assistant store managers
since December 9, 2006. Notice of the Craig action was sent to
the purported members of the collective group (approximately 6,700
current and former assistant store managers) and approximately
1,100 For the Years Ended March 3, 2012, February 26, 2011, and
February 27, 2010, joined the Craig action. The Company has filed
a motion to decertify the class which is presently pending.
In another of the cases, Indergit v. Rite Aid Corporation et al,
pending in the United States District Court for the Southern
District of New York, brought on behalf of current and former
store managers, the Court, on April 2, 2010, conditionally
certified a nationwide collective group of individuals who worked
for the Company as store managers since March 31, 2007. The Court
ordered that Notice of the Indergit action be sent to the
purported members of the collective group (approximately 7,000
current and former store managers) and approximately 1,550 joined
the Indergit action. In another of the cases, Ibea v. Rite Aid
Corporation et al, pending in the United States District Court for
the Southern District of New York, brought on behalf of former
salaried co-managers, the Court, on January 9, 2012, conditionally
certified a collective group of individuals who worked for the
Company as salaried co-managers. The Court ordered that Notice of
the Ibea action be sent to the purported members of the collective
group (approximately 650 former salaried co-managers) and
approximately 140 joined the Ibea action.
At this time, the Company says, it is not able to predict the
outcome of these lawsuits, or any possible monetary exposure
associated with the lawsuits. The Company's management believes,
however, that the lawsuits are without merit and not appropriate
for collective or class action treatment. The Company is
vigorously defending all of these claims.
RITE AID: Still Defends Wage and Hour Violations Class Suits
------------------------------------------------------------
Rite Aid Corporation is currently a defendant in several putative
class action lawsuits filed in state courts in California alleging
violations of California wage and hour laws, rules and regulations
pertaining primarily to pay for missed meals and rest periods and
failure to provide employee seating. These lawsuits purport to be
class actions and seek substantial damages.
No further updates were reported in the Company's April 24, 2012,
Form 10-K filing with the U.S. Securities and Exchange Commission
for the year ended March 3, 2012.
At this time, the Company says it is not able to predict the
outcome of these lawsuits, or any possible monetary exposure
associated with the lawsuits. The Company's management believes,
however, that the plaintiffs' allegations are without merit and
that their claims are not appropriate for class action treatment.
The Company is vigorously defending all of these claims.
ROYAL CARIBBEAN: Awaits Ruling on Bid to Dismiss Attendants' Suit
-----------------------------------------------------------------
Royal Caribbean Cruises Ltd. is awaiting a court decision on its
motion to dismiss a class action lawsuit brought by stateroom
attendants, according to the Company's April 24, 2012, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended March 31, 2012.
A class action complaint was filed in June 2011 against Royal
Caribbean Cruises Ltd. in the United States District Court for the
Southern District of Florida on behalf of a purported class of
stateroom attendants employed onboard Royal Caribbean
International cruise vessels alleging that they were required to
pay other crew members to help with their duties in violation of
the U.S. Seaman's Wage Act. The lawsuit also alleges that certain
stateroom attendants were required to work back of house
assignments without the ability to earn gratuities in violation of
the U.S. Seaman's Wage Act. Plaintiffs seek judgment for damages,
wage penalties and interest in an indeterminate amount. The
Company has filed a Motion to Dismiss the Complaint on the basis
that the applicable collective bargaining agreement requires any
such claims to be arbitrated.
The Company believes it has meritorious defenses to the lawsuit
which it intends to vigorously pursue.
ROYAL CARIBBEAN: Seeks Dismissal of Consolidated Suit in Florida
----------------------------------------------------------------
Royal Caribbean Cruises Ltd. is seeking dismissal of an amended
consolidated securities class action lawsuit filed in Florida,
according to the Company's April 24, 2012, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
March 31, 2012.
Between August 1, 2011, and September 8, 2011, three similar
purported class action lawsuits were filed against the Company and
certain of its officers in the U.S. District Court of the Southern
District of Florida. The cases have since been consolidated and a
consolidated amended complaint was filed on February 17, 2012.
The consolidated amended complaint was filed on behalf of a
purported class of purchasers of the Company's common stock during
the period from October 26, 2010, through July 27, 2011, and names
the Company, its Chairman and CEO, its CFO and the Presidents and
CEOs of its Royal Caribbean International and Celebrity Cruises
brands as defendants. The consolidated amended complaint alleges
violations of Section 10(b) of the Securities Exchange Act of 1934
and SEC Rule 10b-5 as well as, in the case of the individual
defendants, the control person provisions of the Securities
Exchange Act. The complaint principally alleges that the
defendants knowingly made incorrect statements concerning the
Company's outlook for 2011 by not taking into proper account
lagging European and Mediterranean bookings. The consolidated
amended complaint seeks unspecified damages, interest, and
attorneys' fees. The Company filed a motion to dismiss the
complaint on April 9, 2012.
The Company believes the claims are without merit and it intends
to vigorously defend itself against them.
SALSA CYCLES: Recalls 1,100 Bicycle Racks Due to a Fall Hazard
--------------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Salsa Cycles, a wholly-owned brand of Quality Bicycle Products
Inc., of Bloomington, Minnesota, announced a voluntary recall of
about 1,100 Salsa Minimalist bicycle racks. Consumers should stop
using recalled products immediately unless otherwise instructed.
It is illegal to resell or attempt to resell a recalled consumer
product.
The L-shaped mounting straps used to attach the bicycle rack to
the front of the bicycle can break and cause the rack to fall
while the bicycle is in use, posing a fall hazard to the rider.
Salsa Cycles has received two reports of bicycle racks breaking at
the mounting straps, resulting in minor injuries from falls.
This recall involves all Salsa Minimalist bicycle racks sold after
January 2011. The racks are made of tubular aluminum with a black
or silver finish, and can be installed on either the front or rear
of a bicycle. The recalled bicycle racks have steel mounting
brackets, identified as straps, with a single hole in the center
used to mount the strap to the bicycle fork. "Salsa" is printed
on the side of the bicycle rack. Pictures of the recalled
products are available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml12/12175.html
The recalled products were manufactured in Taiwan and sold by
bicycle retail stores nationwide and on Internet retailers from
January 2011 through March 2012 for about $80.
Consumers should immediately remove the recalled bicycle racks and
contact an authorized Salsa dealer for inspection, re-mounting or
refund. For additional information, please contact the firm toll-
free at (877) 725-7211 between 8:00 a.m. and 6:00 p.m. Central
Time Monday through Friday, or visit the firm's Web site at
http://www.salsacycles.com/
SNC-LAVALIN GROUP: Rochon Genova Commences Class Action
-------------------------------------------------------
Rochon Genova LLP has commenced a global class action in Ontario
on behalf of investors of SNC-Lavalin Group Inc. alleging
securities law violations by the company, its Board of Directors
and certain officers.
The claim arises from allegedly unlawful payments made by SNC-
Lavalin to members, associates, and agents of the Gaddafi regime
to secure contracts for infrastructure projects in Libya. It
alleges misrepresentations in SNC-Lavalin's filings, including
that the company was a responsible corporate citizen with sound
corporate governance practices and had adequate controls and
procedures to ensure accurate disclosure and financial reporting.
The allegations are not yet proven.
On February 28, 2012, the company's shares dropped over 20%, a
market loss of over C$1.5 billion. This steep decline followed a
press release in which SNC-Lavalin revealed that its Board of
Directors had launched an investigation into C$35 million of
undocumented payments. That investigation later found the company
had made C$56 million of improper payments to foreign agents and
that those payments had been authorized by the company's former
CEO Pierre Duhaime.
Commenting on the Board's findings and SNC-Lavalin's governance,
Fred Lazar, Associate Professor of Economics at the Schulich
School of Business said: "How can directors not ask the obvious
questions and still claim that the Board is following good
corporate governance practices? Unfortunately, some directors
choose not to ask so that they have 'credible deniability'. Don't
ask and the company doesn't tell, and then, when a scandal breaks,
you have your defense: you didn't know."
According to John Archibald, a lawyer with Rochon Genova: "When a
company repeatedly highlights its strong governance practices to
the investing public, revelations of serious misconduct cause
damage to the company's reputation and, in turn, substantial harm
to its investors."
The lawsuit has been brought on behalf of all SNC-Lavalin
investors, excluding residents of Quebec, who purchased securities
of SNC-Lavalin between February 1, 2007 and February 28, 2012 or
who purchased debentures of the company through the company's June
2009 prospectus offering.
SNC-LAVALIN GROUP: Siskinds Files Securities Class Action
---------------------------------------------------------
The law firm of Siskinds LLP on May 9 announced the filing of a
proposed securities class action in the Ontario Superior Court of
Justice against SNC-Lavalin Group Inc. and certain of its current
and former officers and directors, including Pierre Duhaime,
Gilles Laramee, Riadh Ben Aissa, Stephane Roy, Gwynn Morgan, Ian
Bourne and Michael Novak.
The action has been filed on behalf of The Trustees of the Drywall
Acoustic Lathing and Insulation Local 675 Pension Fund (the
"Fund"). The Fund seeks to act on behalf of all persons (the
"Class Members"), wherever they may reside or be domiciled, who
acquired securities of SNC-Lavalin during the period from and
including November 6, 2009 to and including February 27, 2012.
In the Statement of Claim, it is alleged that SNC-Lavalin and the
remaining defendants made misrepresentations during the Class
Period in relation to, among other things, the adequacy of SNC-
Lavalin's internal controls, as well as SNC-Lavalin's net income
for the 2010 fiscal year, and the compliance of certain of the
individual defendants with the company's code of ethics.
It is further alleged that the defendants' misrepresentations
caused the price of SNC-Lavalin's securities to become inflated,
and that the Class Members suffered damage when the truth was
revealed to the investing public.
On March 1, 2012, the Quebec affiliate of Siskinds LLP, Siskinds
Desmeules, Avocats, commenced a related class action in the
Quebec, where SNC-Lavalin is headquartered.
Media inquiries in relation to this class proceeding should be
directed to Siskinds LLP partner, Dimitri Lascaris.
SONY COMPUTER: Judge Dismisses "Call of Duty" Class Action
----------------------------------------------------------
Nick McCann at Courthouse News Service reports that a federal
judge dismissed a class action that claimed two of the "Call of
Duty" video games cause older versions of the Sony Playstation 3
to overheat, making them unusable.
Plaintiff Henry Garcia sued Sony and Activision Blizzard last year
over alleged problems with the games "Call of Duty: Black Ops" and
"Call of Duty: Modern Warfare."
Mr. Garcia claimed that "normal and intended use of Call of Duty,
and certain other PS3-branded videogames, overtaxes the
computational capabilities of first-generation PS3 models, such as
his, prompting the graphics processor unit (GPU) to overheat and
the console to fail," according to the court's fact summary.
In an order May 7, U.S. District Judge Richard Seeborg found that
Mr. Garcia should have known that his old gaming system would be
incompatible with advances in gaming technology, and he did not
state a plausible claim.
"[I]t it is less than self-evident that consumers would expect
first-generation gaming consoles to be compatible with games
released years later, given the premise that the videogame
industry is typified by rapid technological change," the judge
wrote in his order.
"Common experience suggests the contrary: that constant innovation
often leads to incompatibility and the obsolescence of older
products," he continued. The judge granted Sony and Blizzard's
motion to dismiss Mr. Garcia's unfair competition claim with
prejudice, finding that Mr. Garcia had two opportunities to amend
his complaint with more specific factual allegations, but failed
to do so.
A copy of the Order Granting Motion to Dismiss Without Leave to
Amend in Garcia v. Sony Computer Entertainment America, LLC, et
al., Case No. 11-cv-02246 (N.D. Calif.), is available at:
http://www.courthousenews.com/2012/05/10/311-cv-02246.pdf
STRYKER CORP: Securities Suit in Michigan Dismissed in March
------------------------------------------------------------
A securities class action lawsuit commenced against Stryker
Corporation in Michigan was dismissed in March 2012, according to
the Company's April 24, 2012, Form 10-Q filing with the U.S.
Securities and Exchange Commission for the quarter ended
March 31, 2012.
In 2010, a purported class action lawsuit against the Company was
filed in the United States District Court for the Southern
District of New York on behalf of those who purchased the
Company's common stock between January 25, 2007 and November 13,
2008, inclusive. The lawsuit seeks remedies under the Securities
Exchange Act of 1934. In May 2010, the lawsuit was transferred to
the United States District Court for the Western District of
Michigan Southern Division. On March 30, 2012, the case was
dismissed. Should plaintiffs appeal this ruling, the Company will
continue to vigorously defend this matter.
SUPREME TRADING: Recalls 320 Children's Letterman Jackets
---------------------------------------------------------
The U.S. Consumer Product Safety Commission, in cooperation with
Supreme Trading Limited, of Philadelphia, Pennsylvania, announced
a voluntary recall of about 320 Class Club Children's Letterman
Jackets. Consumers should stop using recalled products
immediately unless otherwise instructed. It is illegal to resell
or attempt to resell a recalled consumer product.
Snaps on the jacket can detach, posing a choking hazard to young
children.
No incidents or injuries have been reported.
This recall involves Class Club brand children's letterman
jackets. The 100% polyester jackets were sold in navy with white
sleeves in sizes 2 to 3. A patch on the upper, right chest of the
jacket reads "28 F Football Athlete State Champs." Style number
"F14CL112L" is printed on the back of the sewn-in size label in
the back neck. A picture of the recalled products is available
at:
http://www.cpsc.gov/cpscpub/prerel/prhtml12/12176.html
The recalled products were manufactured in Vietnam and sold
exclusively at Dillard's stores nationwide and online at
http://www.dillards.com/between September 2011 and November 2011
for about $25.
Consumers should immediately take the jackets from children and
return them to Dillard's for a full refund. For additional
information, please contact Supreme Trading Limited toll-free at
(866) 466-3523 between 9:00 a.m. and 5:00 p.m. Eastern Time Monday
through Friday, or visit the retailer's Web site at
http://www.dillards.com/
SWISHER HYGIENE: Class Action Lead Plaintiff Deadline Nears
-----------------------------------------------------------
The Law Offices of Howard G. Smith on May 4 disclosed that all
purchasers of the securities of Swisher Hygiene Inc. between May
16, 2011 and March 28, 2012, inclusive, have until May 29, 2012,
to move the Court to serve as Lead Plaintiff in the securities
fraud class action lawsuit filed in the United States District
Court for the Southern District of New York.
Swisher provides hygiene and sanitation solutions in North America
and internationally. The Complaint charges Swisher and certain of
the Company's executive officers with violations of federal
securities laws. Specifically, the Complaint alleges that
throughout the Class Period the defendants made false and/or
misleading statements, as well as failed to disclose material
adverse facts about Swisher's business, operations and prospects,
including: (1) that the Company was improperly accounting for
business acquisitions; (2) that the Company was improperly
calculating its allowance for doubtful accounts receivable; (3)
that, as a result, the Company's income was overstated; (4) that,
as such, the Company's financial results were not prepared in
accordance with Generally Accepted Accounting Principles; (5) that
the Company lacked adequate internal and financial controls; and
(6) that, as a result of the foregoing, the Company's financial
statements were materially false and misleading at all relevant
times.
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. If you purchased Swisher securities between May 16,
2011 and March 28, 2012, you have until May 29, 2012, to move for
lead plaintiff status. To be a member of the class you need not
take any action at this time, or may retain counsel of your
choice. If you wish to discuss this action or have questions
concerning this Notice or your rights or interests with respect to
these matters, please contact:
Howard G. Smith, Esq.
Law Offices of Howard G. Smith
3070 Bristol Pike, Suite 112,
Bensalem, PA 19020
Telephone:(215) 638-4847
Toll Free: (888) 638-4847
E-mail: howardsmith@howardsmithlaw.com
Web site: http://www.howardsmithlaw.com
TOWN SPORTS: Still Awaits Order on Suits v. Unit Dismissal Bids
---------------------------------------------------------------
On or about March 1, 2005, in an action styled Sarah Cruz, et al
v. Town Sports International, d/b/a New York Sports Club,
plaintiffs commenced a purported class action against Town Sports
International Holdings, Inc.'s wholly-owned operating subsidiary,
Town Sports International, LLC ("TSI, LLC") in the Supreme Court,
New York County, seeking unpaid wages and alleging that TSI, LLC
violated various overtime provisions of the New York State Labor
Law with respect to the payment of wages to certain trainers and
assistant fitness managers. On or about June 18, 2007, the same
plaintiffs commenced a second purported class action against TSI,
LLC in the Supreme Court of the State of New York, New York
County, seeking unpaid wages and alleging that TSI, LLC violated
various wage payment and overtime provisions of the New York State
Labor Law with respect to the payment of wages to all New York
purported hourly employees. On September 17, 2010, TSI, LLC made
motions to dismiss the class action allegations of both lawsuits
for plaintiffs' failure to timely file motions to certify the
class actions. Oral argument on the motions occurred on November
10, 2010. A decision is still pending.
No further updates were reported in the Company's April 24, 2012,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended March 31, 2012.
While it is not possible to estimate the likelihood of an
unfavorable outcome or a range of loss in the case of an
unfavorable outcome to TSI, LLC at this time, the Company intends
to contest these cases vigorously. Depending upon the ultimate
outcome, these matters may have a material adverse effect on TSI,
LLC's and the Company's consolidated results of operations,
financial condition or cash flows
WAL-MART STORES: Recalls 21,000 Banzai Inflatable Pool Slides
-------------------------------------------------------------
Reported Death, Severe Neck Injuries Prompt Recall
In cooperation with the U.S. Consumer Product Safety Commission
(CPSC), Wal-Mart Stores Inc., of Bentonville, Ark. and Toys R Us
Inc., of Wayne, New Jersey, are announcing the recall of about
21,000 inflatable Banzai in-ground pool water slides. During use,
the slide can deflate, allowing the user to hit the ground
underneath the slide and become injured. The slide is also
unstable and can topple over in both still and windy conditions
and carries inadequate warnings and instructions.
The CPSC is aware that a 29-year-old Colorado mother died in
Andover, Massachusetts, after fracturing her neck going down a
Banzai in-ground pool water slide which had been placed over the
concrete edge of a pool. The victim hit her head at the bottom of
the slide because it had partially deflated.
The CPSC and the retailers are aware of two other injuries which
have occurred in a similar manner, including a 24-year-old man
from Springfield, Missouri, who became a quadriplegic and a woman
from Allentown, Pennsylvania, who fractured her neck.
The recall involves Banzai in-ground pool water slides designed
for use with in-ground pools. The vinyl slides have a blue base,
yellow sliding mat and an arch going over the top of the slide.
By connecting a hose to the top of the slide, water can be sprayed
on its downward slope. The words 'Banzai Splash' are printed in a
circular blue, orange and white logo, shaped like a wave on either
side of the slide. Pictures of the recalled products are
available at:
http://www.cpsc.gov/cpscpub/prerel/prhtml12/12174.html
The recalled slides, which were manufactured in China by Manley
Toys, Ltd, were sold at Walmart and Toys R Us nationwide from
January 2005 through June 2009 for about $250. The recalled
slides have the barcode number 2675315734 and model number 15734.
Both the barcode and model number appear on the original packaging
but are not on the actual slide.
CPSC urges consumers to immediately stop using the product and
return it to the nearest Walmart or Toys R Us for a full refund.
Consumers can also cut the two safety warning notices out of the
slide and just return that portion. For additional information
from Walmart, call (800) 925-6278 between 7:00 a.m. and 9:00 p.m.
Central Time Monday through Friday, or visit the firm's Web site
at http://www.walmartstores.com/. For additional information from
Toys R Us, call (800) 869-7787 between 9:00 a.m. and 9:00 p.m.
Eastern Time Monday through Saturday and between 10:00 a.m. and
7:00 p.m. Sunday, or visit the firm's Web site at
http://www.toysrus.com/
WMI LIQUIDATING: LTW Settlement Became Effective in April
---------------------------------------------------------
WMI Liquidating Trust disclosed in its April 24, 2012, Form 8-K
filing with the U.S. Securities and Exchange Commission, that the
settlement agreement of claims arising from litigation tracking
warrants became effective in April 2012.
WMI Liquidating Trust (the "Trust") was formed on March 6, 2012,
when Washington Mutual, Inc. ("WMI") and its wholly-owned
subsidiary, WMI Investment Corp. ("Investment" and collectively
with WMI, the "Debtors"), entered into a liquidating trust
agreement with William C. Kosturos as the liquidating trustee, and
CSC Trust Company of Delaware, as the Delaware resident trustee
(the "Agreement"). As previously announced, the Debtors' Seventh
Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of
the United States Bankruptcy Code, as modified by the Modification
of Seventh Amended Plan dated January 9, 2012, the Second
Modification of Seventh Amended Plan dated January 12, 2012, and
the Third Modification of Seventh Amended Plan dated February 16,
2012 (collectively, the "Plan"), became effective on March 19,
2012 (the "Effective Date").
As disclosed in the Notice of Final Effective Date of LTW
Settlement filed by counsel for the Trust with the U.S. Bankruptcy
Court for the District of Delaware presiding over the Debtors'
Chapter 11 proceedings (the "Bankruptcy Court") on
April 17, 2012 [D.I. 10067] (the "LTW Notice"), none of the
Attorney General of the United States, the Comptroller of the
Currency or any of the States Attorneys General (collectively, the
"Government Parties") interposed an objection to the Stipulation
and Agreement Between the Debtors and Class Representatives of the
LTW Holders Resolving Adversary Proceeding and The LTW Proofs of
Claim, dated January 10, 2012 (the "LTW Stipulation") between the
Debtors and Axicon Partners, LLC, Blackwell Capital Partners, LLC,
Brennus Fund Limited, Costa Brava Partnership III, LLP, Nantahala
Capital Partners, LP, Sonterra Capital Master Fund, Ltd,
(collectively, the "Named Plaintiffs"), individually and on behalf
of all holders of Litigation Tracking Warrants originally issued
by Dime Bancorp, Inc. (collectively, the "LTW Holders").
As a result, as disclosed in the attached LTW Notice and in
accordance with the Bankruptcy Court's Order Pursuant to Section
105(a) of the Bankruptcy Code, Bankruptcy Rules 7023 and 9019, and
Federal Rule of Civil Procedure 23(e), Approving Stipulation and
Agreement Between the Debtors and Class Representatives of the LTW
Holders, dated February 11, 2012 [D.I. 9649] (the "LTW Order") and
the LTW Stipulation, distributions were made with respect to the
Allowed LTW Claims (within the meaning of the LTW Order and LTW
Stipulation, respectively) on April 17, 2012, to those LTW Holders
who executed and delivered releases in accordance with Section
41.6 of the Plan. Such distributions consisted of an aggregate of
$8,070,454 in cash, $39,051 in Runoff Notes (as such term is
defined in the Plan) and 4,486,672 shares of common stock of
reorganized WMI ("WMI Holdings Corp."). As also disclosed in
Section 41.6 of the Plan, those LTW Holders who did not release
their claims will not receive any distribution under the Plan.
* Conception Ruling Leads to Dismissal of 76 Class Actions
----------------------------------------------------------
Ian Millhiser, writing for ThinkProgress, reports that about one
year ago, the Supreme Court handed down its most significant
pro-corporate decision since Citizens United -- a decision which
empowered corporations to force their workers and consumers to
completely sign away their ability to hold the corporation
accountable in a class action lawsuit. As the New York Times
reports, this case, AT&T v. Concepcion, has now been invoked at
least 76 times to stop a class action from moving forward.
As ThinkProgress explained a year ago when Concepcion was handed
down, the practical impact of this decision is that corporations
have almost free reign to illegally nickel and dime their workers
and consumers out of a few dollars at a time:
"Imagine that your cell phone company cheated you out of just $30.
Would you sue? Bear in mind that filing a lawsuit will require you
to spend hour upon hour filing out forms and drafting complaints
and dealing with legal codes that you probably know little about.
Of course you can always hire a lawyer, but your lawyer's hourly
fee will eat up all of the $30 you stand to win in just a few
minutes. In other words, you, like just about everyone else in
the world who is scammed out of just a few dollars, you will
probably give the lawsuit a pass.
Fortunately, there is a solution to this problem -- the class
action lawsuit. If your cell phone company cheated you and you
alone, you're out of luck. But if they systematically scammed
thousands of their customers out of the same $30 -- nickel and
diming their way to huge profits -- the law allows all of you to
join together into a class action lawsuit and make sure that the
company is held accountable.
That is, of course, until [now]."
The significant number of suits dismissed thanks to Concepcion
confirms that corporate America is already taking advantage of the
gift the Court's conservative justices gave them last year. In
one of those cases, for example, a group of U.S. servicemembers
who allegedly were illegally required to pay a few hundred dollars
each by the Nissan car company were denied their ability to join
together in a class action.
*********
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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and Peter A. Chapman, Editors.
Copyright 2012. All rights reserved. ISSN 1525-2272.
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