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/raid1/www/Hosts/bankrupt/CAR_Public/130228.mbx C L A S S A C T I O N R E P O R T E R Thursday, February 28, 2013, Vol. 15, No. 42 Headlines 21ST CENTURY: Faces Class Action for Charging Extra Payment AFFYMAX INC: Recalls Omontys Anemia Drug Due to Allergy Risk ASSOCIATED BANC-CORP: March Hearing on Overdraft Fee Suit Accord ASUS COMPUTER: Consumer Class Action Deal Gets Initial Approval BANCO SANTANDER: US Auto Financing Arm Sued Over Phone Recording BIGDEAL.COM: Faces Class Action for Being Unlicensed Gambling Site BRUCE FOODS: Recalls Mislabeled Food Club Red Enchilada Sauce BRUCE FOODS: Expands Recall of Food Club Red Enchilada Sauce CBS CORP: Still Defends Simon From Suits Over E-Book Sales CHARLES SCHWAB: Obtains Approval to Ban Clients' Class Actions COLORADO: Douglas County Faces Class Action Over Teacher Layoffs CONSUMER PORTFOLIO: Awaits Rulings on Judgment Bids in R.I. Suit COSTCO WHOLESALE: Faces Class Action Over Crab Spread Recall CVS CAREMARK: Appeal From Dismissal of Securities Suit Pending CVS CAREMARK: Appeals in "Lauriello" Class Suit Remain Pending CVS CAREMARK: Continues to Defend PBM Antitrust Violations Suits CYMER INC: Signs MOU to Settle Merger-Related Suit in Nevada DIRECTV: Faces Class Action for Unpaid Overtime DOLE FOOD: Faces Class Action Over Misleading Product Labels ENBRIDGE ENERGY: Defends Class Suits Over Crude Oil Releases FAMILY DOLLAR: Faces Suit Over Selling Shares at Inflated Price FOCUS MEDIA: Being Sold to Giovanna for Too Little, Suit Claims GOLDCOAST SALADS: Recalls Additional Seafood Spread Products HEARTLAND BRANDS: Recalls Two Varieties of Granola Cereals HERBALIFE INT'L: Recalls Healthy Meal Shake Mix for Milk Allergen HONEST KITCHEN: Recalls Verve(R), Zeal(R) and Thrive(R) Products HONEYWELL INT'L: Continues to Defend "UAW" Suit in Michigan HONEYWELL INT'L: Has Final Approval of Quick Lube MDL Settlement HY-VEE INC: Recalls Dog Food Products Due to Chemical Contaminant ILLINOIS: Ex-Madison County Treasurer Faces Suit Over Tax Auctions KING ARTHUR: Recalls Flour Over Presence of Polyurethane Balls KUMQUAT PROPERTIES: Failed to Secure 66 Pearl Premises, Suit Says LENOVO GROUP: Faces Class Action Over Slow Notebook Computers LOCKHEED MARTIN: Workers File Class Action Over Labor Violations MANDY STAR: Recalls "Good Taste" Preserved Fruits Over Sulfites MONDELEZ GLOBAL: Recalls 2 Varieties of belVita Breakfast Biscuit NEW YORK: Gun Owners Mull Class Action Over State's SAFE Act NORFOLK SOUTHERN: Awaits Ruling in Fuel Surcharges MDL Appeal OHIO: Cuyahoga County Exec Faces Class Action Over Pay Cuts PANERA BREAD: Cal. Court OK'd Attorneys' Fees in "Sotoudeh" Suit PILGRIMS PRIDE: Hearing on Class Certification Bid on Feb. 28 SARPES BEVERAGES: Faces Class Action Over "Dream Water" SB NEW YORK: Faces Wage Suit Filed by Newspaper Distributors SPI ELECTRICITY: Class Action Participants Can Watch Trial Live UNITED STATES: Filipino Veterans' Class Suit Dismissed USG CORP: Accrues $8-MM to Resolve Knauf Tianjin Wallboard Suit USG CORP: Faces Class Suits Over Pricing of Gypsum Wallboards * Class Actions Put Manufacturers at Risk of Financial Losses ********* 21ST CENTURY: Faces Class Action for Charging Extra Payment ----------------------------------------------------------- Courthouse News Service reports that 21st Century Advantage Insurance, AIG, et al. bamboozled customers by charging them extra for stacked coverage though they could not benefit from it, a class action claims in Santa Fe County Court. AFFYMAX INC: Recalls Omontys Anemia Drug Due to Allergy Risk ------------------------------------------------------------ Affymax, Inc. (Nasdaq: AFFY) and Takeda Pharmaceutical Company Limited (Takeda) have decided to voluntarily recall all lots of OMONTYS(R) (peginesatide) Injection to the user level as a result of new postmarketing reports regarding serious hypersensitivity reactions, including anaphylaxis, which can be life-threatening or fatal. The Companies have been working actively with the U.S. Food and Drug Administration (FDA) which has indicated its agreement with this decision. The Companies have also issued a letter to health care professionals indicating that no new or existing patients should receive OMONTYS. To date, fatal reactions have been reported in roughly 0.02% of patients following the first dose of intravenous administration. The reported serious hypersensitivity reactions have occurred within 30 minutes after such administration of OMONTYS. There have been no reports of such reactions following subsequent dosing, or in patients who have completed their dialysis session. Since launch, more than 25,000 patients have received OMONTYS in the postmarketing setting. The rate of overall hypersensitivity reactions reported is approximately 0.2% with approximately a third of these being serious in nature including anaphylaxis requiring prompt medical intervention and in some cases hospitalization. The Companies are actively investigating these cases. In the meantime, dialysis organizations are instructed to discontinue use. Customers will be provided instructions on how to return the product to the manufacturer for a refund. For customers with questions, please call 1-855-466-6689 [9:00 a.m. to 5:00 p.m. Eastern Standard Time, Monday through Friday]. OMONTYS (peginesatide) Injection is indicated for the treatment of anemia due to chronic kidney disease in adult patients on dialysis and is packaged in 10 mg and 20 mg Multi-dose vials: * 10 mg Multi-dose Vials - NDC 64764-610-10 * 20 mg Multi-dose vials - NDC 64764-620-20 All lots of OMONTYS are affected by this recall: * 10 mg Multi-dose vials, Lots C18685, C18881, C19258 * 20 mg Multi-dose vials, Lots C18686, C18696 The product can be identified by its product labeling featuring the name OMONTYS. OMONTYS was distributed Nationwide, including Puerto Rico and Guam, to dialysis centers via specialty distributors. Adverse reactions or quality problems experienced with the use of this product may be reported to the FDA's MedWatch Adverse Event Reporting program either online, by regular mail or by fax. * Online: http://www.fda.gov/medwatch/report.htm/ * Regular Mail: use postage-paid, pre-addressed Form FDA 3500 available at: http://www.fda.gov/MedWatch/getforms.htm./ Mail to address on the pre-addressed form. * Fax: 1-800-FDA-0178 This recall is being conducted with the knowledge of the U.S. Food and Drug Administration. IMPORTANT SAFETY INFORMATION WARNING: ESAs INCREASE THE RISK OF DEATH, MYOCARDIAL INFARCTION, STROKE, VENOUS THROMBOEMBOLISM, THROMBOSIS OF VASCULAR ACCESS AND TUMOR PROGRESSION OR RECURRENCE. Chronic Kidney Disease: * In controlled trials, patients experienced greater risks for death, serious adverse cardiovascular reactions, and stroke when administered erythropoiesis-stimulating agents (ESAs) to target a hemoglobin level of greater than 11 g/dL. * No trial has identified a hemoglobin target level, ESA dose, or dosing strategy that does not increase these risks. * Use the lowest OMONTYS dose sufficient to reduce the need for RBC transfusions. Contraindications OMONTYS is contraindicated in patients with uncontrolled hypertension and in patients who have had serious allergic reactions, which may include anaphylaxis, to OMONTYS. Warnings and Precautions Increased mortality, myocardial infarction, stroke, and thromboembolism: * Using ESAs to target a hemoglobin level of greater than 11 g/dL increases the risk of serious adverse cardiovascular reactions and has not been shown to provide additional benefit. Use caution in patients with coexistent cardiovascular disease and stroke. Patients with CKD and an insufficient hemoglobin response to ESA therapy may be at even greater risk for cardiovascular reactions and mortality. A rate of hemoglobin rise of > 1 g/dL over 2 weeks may contribute to these risks. * In controlled clinical trials of ESAs in patients with cancer, increased risk for death and serious adverse cardiovascular reactions including myocardial infarction and stroke was observed. * There is increased mortality and/or increased risk of tumor progression or recurrence in patients with cancer receiving ESAs. * In controlled clinical trials of ESAs, ESAs increased the risk of death in patients undergoing coronary artery bypass graft surgery (CABG) and deep venous thrombosis (DVT) in patients undergoing orthopedic procedures. * In 2 trials of OMONTYS, patients with CKD not on dialysis experienced increased specific cardiovascular events. Hypertension (see Contraindications): Appropriately control hypertension prior to initiation of and during treatment with OMONTYS. Reduce or withhold OMONTYS if blood pressure becomes difficult to control. Serious allergic reactions (see Contraindications): Serious allergic reactions, including anaphylactic reactions, hypotension, bronchospasm, angioedema and generalized pruritus, may occur in patients treated with OMONTYS. Immediately and permanently discontinue OMONTYS and administer appropriate therapy if a serious allergic reaction occurs. Lack or loss of response to OMONTYS: Initiate a search for causative factors. If typical causes of lack or loss of hemoglobin response are excluded, evaluate for antibodies to peginesatide. Dialysis management: Patients receiving OMONTYS may require adjustments to dialysis prescriptions and/or increased anticoagulation with heparin to prevent clotting of the extracorporeal circuit during hemodialysis. Laboratory monitoring: Evaluate transferrin saturation and serum ferritin prior to and during OMONTYS treatment. Administer supplemental iron therapy when serum ferritin is less than 100mcg/L or when serum transferrin saturation is less than 20%. Monitor hemoglobin every 2 weeks until stable and the need for RBC transfusions is minimized. Then, monitor monthly. Adverse Reactions Most common adverse reactions in clinical studies in patients with CKD on dialysis treated with OMONTYS were dyspnea, diarrhea, nausea, cough, and arteriovenous fistula site complication. Please click: http://is.gd/vKSBRyfor Full Prescribing Information, including Boxed WARNINGS, also available at http://www.omontys.com/ OMONTYS Indication and Limitations of Use OMONTYS(R) (peginesatide) Injection is indicated for the treatment of anemia due to chronic kidney disease (CKD) in adult patients on dialysis. OMONTYS is not indicated and is not recommended for use in patients with CKD not on dialysis, in patients receiving treatment for cancer and whose anemia is not due to CKD, or as a substitute for red blood cell (RBC) transfusions in patients who require immediate correction of anemia. OMONTYS has not been shown to improve symptoms, physical functioning, or health-related quality of life. About Affymax, Inc. Affymax, Inc. -- http://www.affymax.com/-- is a biopharmaceutical company based in Palo Alto, California. Affymax's mission is to discover, develop and deliver innovative therapies that improve the lives of patients with kidney disease and other serious and often life-threatening illnesses. About Takeda Pharmaceutical Located in Osaka, Japan, Takeda -- http://www.takeda.com/-- is a research-based global company with its main focus on pharmaceuticals. As the largest pharmaceutical company in Japan and one of the global leaders of the industry, Takeda is committed to strive towards better health for patients worldwide through leading innovation in medicine. ASSOCIATED BANC-CORP: March Hearing on Overdraft Fee Suit Accord ---------------------------------------------------------------- A final approval hearing on Associated Banc-Corporation's settlement of a class action lawsuit against its subsidiary is scheduled for March 2013, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. A putative class action lawsuit, Harris v. Associated Bank, N.A. (the "Bank"), was filed in the United States District Court for the Western District of Wisconsin in April 2010, alleging that the Bank unfairly assessed and collected overdraft fees and seeking restitution of the overdraft fees, compensatory, consequential and punitive damages, and costs. The case was subsequently consolidated into the Multi District Litigation ("MDL"), In re: Checking Account Overdraft Litigation MDL No. 2036 in the United States District Court for the Southern District of Florida. A settlement agreement which requires payment by the Bank of $13 million for a full and complete release of all claims brought against the Bank received preliminary approval from the court on July 26, 2012. A final approval hearing on the settlement is scheduled for March 2013. In the second quarter of 2012, the Bank settled with an insurer for $2.5 million as contribution to the settlement amount and received approximately $1.5 million as partial reimbursement for defense costs. By entering into such an agreement, the Company has not admitted any liability with respect to the lawsuit. The settlement amount was previously accrued for in the financial statements. Founded in 1964 and headquartered in Green Bay, Wisconsin, Associated Banc-Corp -- http://www.associatedbank.com/-- a bank holding company, offers various banking and financial services to individuals and businesses primarily in Wisconsin, Illinois, and Minnesota. ASUS COMPUTER: Consumer Class Action Deal Gets Initial Approval --------------------------------------------------------------- District Judge William Alsup granted preliminary approval of a revised settlement agreement in the lawsuit captioned COLIN FRASER, individually and on behalf of all others similarly situated, Plaintiff, v. ASUS COMPUTER INTERNATIONAL, a California Corporation, and ASUSTEK COMPUTER, INC., a Taiwanese Corporation, Defendants, No. C 12-00652 WHA, (N.D. Cal.). This putative consumer class action is brought on behalf of consumers who purchased tablet computers from Asus Computer International and Asustek Computer, Inc. Following denial of their first motion for preliminary approval of a settlement and certification of a settlement class, the parties continued settlement discussions under the supervision of Magistrate Judge Jacqueline Corley. The Plaintiff filed a new motion for certification of a class for settlement purposes and preliminary approval of a revised class action settlement. The Defendant has filed a statement of non-opposition in support of the proposed settlement. The Defendant further contends that because the proposed settlement is on a claims-made basis, and the Plaintiff's counsel has agreed not to seek attorney's fees beyond its actual and reasonable fees and costs, there is no need for a final fairness hearing. Judge Alsup granted the Plaintiff's request. However, the Defendant's request to waive a final fairness hearing or opportunity to object is DENIED. The Court ORDERS that notice of the settlement be revised to reflect that: -- motion for final approval should be filed by May 9, 2013. -- Any objections must be in writing and postmarked by May 20, 2013. -- A final fairness hearing is set for June 13, 2013, at 2:00 p.m. The Notice will be published and sent out to class members by March 11, 2013. The court vacated the hearing scheduled for February 21. A copy of the District Court's February 19, 2013 Order is available at http://is.gd/2m3lHgfrom Leagle.com. BANCO SANTANDER: US Auto Financing Arm Sued Over Phone Recording ---------------------------------------------------------------- Sokolove Law on Feb. 21 disclosed that recording telephone conversations with consumers without their consent has landed Banco Santander's U.S. auto-financing arm in a proposed class action suit in California federal court. Law360 reports that lead plaintiff Jose C. Zendejas claims that he received a call from a Santander employee who did not inform him that their conversation was being recorded. When questioned directly by the plaintiff at the end of the call, the employee admitted to recording the conversation. The employee allegedly sought information about a friend of Mr. Zendejas and claimed he was listed as reference by the friend. Under California state law it is illegal to record a telephone conversation without consent. The lawsuit also alleges that Zendejas had no way of knowing that the conversation was being recorded as there was no intermittent beeping during the call, states Law360. The suit seeks to represent a class of thousands of California residents whose phone conversations may have been recorded by Santander illegally during the past 12 months. The lawsuit seeks $5,000 in damages for every illegal phone recording violation, reports Law360. BIGDEAL.COM: Faces Class Action for Being Unlicensed Gambling Site ------------------------------------------------------------------ Philip A. Janquart at Courthouse News Service reports that Project Fair Bid's penny auction website, Bigdeal.com, was a $100 million RICO gambling racket, a John Doe claims in a federal class action. Doe claims Project Fair Bid ran BigDeal.com, an unlicensed gambling site that operated in violation of state and federal laws. He claims the site misled customers into thinking they could win prizes such as Apple iPods and laptop computers for a fraction of their retail cost. The website claimed: "Winners save around 75 percent on average, and many save 98 percent or even more," and, "We guarantee you a fair chance to win a great deal," and, "Everyone's a winner on BigDeal.com," according to the complaint. The website, which operated from 2009 to 2011, charged bidding fees on top of an entry fee for a chance to win prizes. "In order to participate in BigDeal.com's 'auctions,' players were charged entry fees that ranged in price from $22.50 to more than $500," the complaint states. "These entry fees were similar to purchasing poker chips and were used to place 'bids.'" After paying to register, participants were charged to bid. "Each auction contained a designated box that, when clicked, charged a nonrefundable $.75 fee to the player's account," the complaint states. "Clicking the box afforded players a chance to win the designated auction prize." Each bid increased the price of the item by 1 penny. The auction was won by the last player to timely place a bid before time expired. "All failed bids were revenue to BigDeal.com," the complaint states. "If a player 'bid' 200 times, he or she lost $120 (200 x $.75) to BigDeal.com." (Sic: recte $150.) The only exception to the rules was BigDeal.com's "Bid Buddy," a computerized bidding program that automatically placed bids for participants, according to the complaint. "According to BigDeal.com's website, Bid Buddy would enter bids when the auction fell under the 30-second reset time and it bid at a random time within that period," the complaint states. "Bid Buddy was programmed to beat all other bidders. Thus, if a Bid Buddy was in play, manual participants would have no chance of winning. BigDeal.com did not disclose this fact to the players, nor did it disclose to the player when a Bid Buddy was in play." The game design created a hectic bidding atmosphere, Doe said. "At any time, any number of players could activate and utilize Bid Buddy, as long as they activated it when there was time remaining on the clock," the complaint states. "In a BigDeal.com auction, there were tens to hundreds of bidders, and bidding could be rapid and frenzied as each player and Bid Buddy were chancing the future unknown result of being the last to bet in order to win the merchandise." Doe claims that BidDeal.com, which did not have a gambling license, conducted hundreds of auctions every day, misled participants about what they were actually spending their money on, and broke state and federal gambling laws. Worse, Doe claims, BigDeal.com kept computer records of each player, logging personal information such as their names, addresses, phone numbers, user names, passwords and credit card numbers. "The records included the players' bidding records by date and time, the date and time of each losing bid and each winning bid, the prizes won be each player and the cost of those prizes to BigDeal.com," the complaint states. "The total losses of each player and the winnings acquired by BigDeal.com can be readily computed from the company's detailed computer records, which can be obtained through discovery." Doe claims that BigDeal.com scooped in about $100 million. Also named as defendants are Mayfield XIII, Foundation Capital VI L.P. and First Round Capital II L.P., venture capital companies based in San Francisco, which collectively provided $4.5 million to start the site, according to the complaint. Also sued are Rajil Kapoor, a venture partner at Mayfield who became a director for BigDeal.com in July 2009; Charles Maldow, a general partner at Foundation Capital; and Josh Kopelman, a partner at First Round, according to the complaint. Also sued are Nicolas Darveau-Garneau and Brandon Ramsey, described as founding partners of BigDeal.com, who helped manage, operate and finance, and obtain financing from other defendants. Doe seeks statutory and treble damages for RICO violations, bank fraud and violations of the Unlawful Internet Gambling Enforcement Act of 2006. His lead counsel is Robert S. Green, with Green & Noblin, of Larkspur. The firm may be reached at: Green & Noblin, P.C. 700 Larkspur Landing Circle, Suite 275 Larkspur, CA 94939 Tel: 415-477-6700 Fax: 415-477-6710 E-mail: gn@classcounsel.com BRUCE FOODS: Recalls Mislabeled Food Club Red Enchilada Sauce ------------------------------------------------------------- Bruce Foods Corporation of New Iberia, Louisiana, is recalling mislabeled cans of 10 oz. Food Club Red Enchilada Sauce with code GES 462449, Best Before Date: 12/3/2016 that could contain Green Enchilada Sauce instead of Red Enchilada Sauce. Only the Food Club Green Enchilada contains wheat and soy. People who have an allergy or sensitivity to wheat and soy run the risk of allergic reaction if they consume this Green Enchilada Sauce product. The recalled product was distributed between 1/15/2013 and 1/16/2013 in Virginia and Minnesota. The product reached the consumer through retail stores. The product recall is for canned 10 oz size Food Club Red Enchilada Sauce with code GES 462449 with a Best Before Date: 12/03/2016 printed on the can end. Picture of the recalled products' label is available at: http://www.fda.gov/Safety/Recalls/ucm340724.htm No illnesses have been reported to date. The recall was initiated after it was discovered that a can labeled as Red Enchilada contained Green Enchilada Sauce. The Green Enchilada Sauce contains wheat and soy. Consumers who have purchased the Food Club Red Enchilada Sauce with code GES 462449 with a Best Before Date: 12/03/2016 are urged to return it to the place of purchase for a full refund. Consumers with questions may contact Larry Thibodeaux at Bruce Foods at 1-337-365-8101, 8:00 a.m. to 5:00 p.m. Central Time. BRUCE FOODS: Expands Recall of Food Club Red Enchilada Sauce ------------------------------------------------------------ Bruce Foods Corporation of New Iberia, Louisiana, is recalling mislabeled cans of 10 oz Food Club Red Enchilada Sauce with code GES 462449, Best Before Date: 12/3/2016 that could contain Green Enchilada Sauce instead of Red Enchilada Sauce. Only the Food Club Green Enchilada contains wheat and soy. People who have an allergy or sensitivity to wheat and soy run the risk of allergic reaction if they consume this Green Enchilada Sauce product. The recalled product was distributed between 1/15/2013 and 1/28/2013 in Virginia, Minnesota and Indiana. The product reached the consumer through retail stores. The product recall is for canned 10 oz size Food Club Red Enchilada Sauce with code GES 462449 with a Best Before Date: 12/03/2016 printed on the can end. No illnesses have been reported to date. The recall was initiated after it was discovered that a can labeled as Red Enchilada contained Green Enchilada Sauce. The Green Enchilada Sauce contains wheat and soy. Consumers who have purchased the Food Club Red Enchilada Sauce with code GES 462449 with a Best Before Date: 12/03/2016 are urged to return it to the place of purchase for a full refund. Consumers with questions may contact Larry Thibodeaux at Bruce Foods at 1-337-365-8101, 8:00 a.m. to 5:00 p.m. Central Time. CBS CORP: Still Defends Simon From Suits Over E-Book Sales ---------------------------------------------------------- CBS Corporation continues to defend its subsidiary against lawsuits related to sales of e-books, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. A number of lawsuits have been pending against the following parties relating to the sale of e-books: Apple Inc., Hachette Book Group, Inc., HarperCollins Publishers, LLC, Holtzbrinck Publishers LLC d/b/a Macmillan, Penguin Group (USA) Inc. and the Company's subsidiary, Simon & Schuster, Inc. On April 10, 2012, for purposes of settlement and without any admission of wrongdoing or liability, Simon & Schuster and two of the other Publishing parties entered into a settlement stipulation and proposed final judgment (the "Stipulation") with the United States Department of Justice (the "DOJ") in connection with the DOJ's investigations of agency distribution of e-books. In furtherance of this settlement, on April 11, 2012, the DOJ filed an antitrust action in the United States District Court for the Southern District of New York against the Publishing parties and concurrently filed the Stipulation with the court. On September 7, 2012, the Stipulation was approved by the court and final judgment was entered. The Stipulation does not involve any monetary payments by Simon & Schuster, but will require the adoption of certain business practices for a 24 month period and certain compliance practices for a five year period. On June 11, 2012, for purposes of settlement and without any admission of wrongdoing or liability, Simon & Schuster entered into a proposed settlement agreement to resolve the antitrust action filed by a number of states and the Commonwealth of Puerto Rico against several of the Publishing parties in the United States District Court for the Western District of Texas, which was transferred to the United States District Court for the Southern District of New York ("States") on April 30, 2012. The proposed settlement provides that, certain Publishing parties, including Simon & Schuster, will pay agreed upon amounts for consumer restitution, among other things, and also requires the adoption of certain business and compliance practices, which are substantially similar to those described in the Stipulation with the DOJ. On September 14, 2012, the court granted preliminary approval of the proposed settlement, which all states (except Minnesota), the District of Columbia and the United States territories joined. On October 15, 2012, Simon & Schuster paid the agreed upon amounts into an escrow account pending final court approval. On February 8, 2013, the court approved the proposed settlement following a final settlement approval hearing that day. The Company believes that this settlement with the States and the Stipulation with the DOJ will not have a material adverse effect on its results of operations, financial position or cash flows. On December 9, 2011, the United States Judicial Panel on Multidistrict Litigation (the "MDL") issued an order consolidating in the United States District Court for the Southern District of New York various purported class action lawsuits that private litigants had filed in federal courts in California and New York. On January 20, 2012, the plaintiffs filed a consolidated amended class action complaint with the court against the Publishing parties. These private litigant plaintiffs, who are e-book purchasers, allege that, among other things, the defendants are in violation of federal and/or state antitrust laws in connection with the sale of e-books pursuant to agency distribution arrangements between each of the publishers and e-book retailers. The consolidated amended class action complaint generally seeks multiple forms of damages for the purchase of e-books and injunctive and other relief. On March 2, 2012, the Publishing parties filed a motion to dismiss this action. On May 15, 2012, the court denied the motion to dismiss. The Company believes that the States' settlement will likely resolve the class claims of those private litigant plaintiffs in the MDL litigation who reside in the areas covered by the States' settlement and who do not opt out of such settlement. Commencing on February 24, 2012, similar antitrust lawsuits have been filed under Canadian law against the Publishing parties by private litigants in Canada, purportedly as class actions. Simon & Schuster intends to vigorously defend itself in the MDL and Canadian matters. In addition, the European Commission (the "EC") and Canadian Competition Bureau are conducting separate competition investigations of agency distribution arrangements of e-books in this industry and Simon & Schuster is cooperating with these investigations. On September 19, 2012, the EC began accepting public comment on the terms of a proposed settlement. On December 12, 2012, following the close of that comment period, the EC accepted the proposed settlement. The settlement between the EC and certain Publishing parties, including Simon & Schuster, requires the adoption of certain business and compliance practices similar to those described in the Stipulation with the DOJ. Founded in 1986 and headquartered in New York, CBS Corporation -- http://cbscorporation.com/-- together with its subsidiaries, operates as a mass media company in the United States and internationally. The Company is composed of an Entertainment segment, a Cable Networks segment, a Publishing segment, a Local Broadcasting segment, and an Outdoor segment. CHARLES SCHWAB: Obtains Approval to Ban Clients' Class Actions -------------------------------------------------------------- Tess Stynes and Caitlin Nish, writing for Dow Jones Newswires, report that Charles Schwab Corp. can ban its clients from bringing class-action lawsuits, a securities industry regulatory panel ruled on Feb. 21 in a sweeping decision that may be adopted broadly by U.S. brokerage firms. Schwab last year told customers it was modifying their 8.8 million account agreements to prohibit class-action suits and to modify their ability to have arbitration cases consolidated. The decision followed settlements of class-action litigation by Schwab in which it agreed to pay $235 million for misleading marketing of its high-interest YieldPlus money-market fund between May 2006 and March 2008. A Financial Industry Regulatory Authority hearing panel said in a 48-page ruling that the class-action ban is consistent with federal law and recent Supreme Court interpretations of the Federal Arbitration Act. The ruling is a blow to FINRA, a private group that regulates broker-dealers and administers arbitration panels. It was also a blow to class-action lawyers. In February, FINRA's enforcement department charged Schwab with violating its rules by limiting clients' class-action and arbitration rights. The hearing panel on Feb. 21 agreed that the class-action ban violates the self-regulator's rules but found that the rules are not enforceable because they conflict with the Federal Arbitration Act. "Schwab is pleased with the panel's decision," the San Francisco- based firm said in a statement. "The company believes customers are better served through the existing FINRA arbitration process and that class-action lawsuits are a cumbersome and less effective means of resolving disputes -- for both parties." A FINRA spokeswoman said the group was reviewing the decision, and could not yet comment on whether it would appeal the ruling to its appellate body, the National Adjudicatory Council. Securities industry officials said it is likely that many firms will now attempt to revise their customer account agreements. "FINRA could appeal, but you have a fairly well-developed decision here," said Kevin Carroll, associate general counsel of the Securities Industry and Financial Markets Associations, broker- dealers' main trade group. "It's up to our individual members to determine if they will adopt a class-action ban." Plaintiffs' lawyers said an appeal is almost certain and will be in the best interests of brokerage firm clients. "It's a significant step backwards for consumers," said Ryan K. Bakhtiari, a partner at Aidikoff, Uhl & Bakhtiari in Beverly Hills, California, and past president of the Public Investors Arbitration Bar Association. "I would expect FINRA to move to protect its turf." Some lawyers said it is far from certain that a single panel ruling can determine far-reaching law. "This ruling threatens most securities class-actions, but the panel does not usually make the law," said John Coffee, a securities law professor at Columbia Law School. In spite of the ruling, FINRA can tell broker-dealers that if they want to remain members they still have to abide by its "fair-play" rules, he said. The Securities and Exchange Commission, which delegates regulatory authority over brokers to FINRA, requires all broker-dealers to be members and all brokers who sell securities to be licensed by FINRA. FINRA prevailed in one of its three actions against Schwab. The panel said Schwab violated FINRA rules by limiting the powers of its arbitrators to consolidate individual client claims in hearings. The panel said the federal arbitration rule does not dictate how arbitration forums should be run and fined Schwab $500,000. It also ordered the broker to take corrective action and remove the violative language from its customer agreements. Schwab removed the language in January, a Schwab spokesman said. He added that Schwab was pleased that it prevailed "on the central class-action waiver issue." According to AdvisorOne's Melanie Waddell, the FINRA panel stated that it had dismissed two of three causes in a February 2012 complaint against Charles Schwab & Co. regarding Schwab asking its customers to waive their rights to bring class actions against the firm. The panel concluded that "the amended language used in Schwab's customer agreements to prohibit participation in judicial class actions does violate FINRA rules, but that FINRA may not enforce those rules because they are in conflict with the Federal Arbitration Act (FAA)." But in the third cause of action, the FINRA panel found that Schwab violated FINRA rules "by attempting to limit the powers of FINRA arbitrators to consolidate individual claims in arbitration. The panel further concluded that the FAA does not bar enforcement of FINRA's rules regarding the powers of arbitrators, because the FAA does not dictate how an arbitration forum should be governed and operated, or prohibit the consolidation of individual claims." In its complaint, FINRA explains that its Enforcement Department had charged Schwab with "violating FINRA rules concerning language or conditions that firms may place in customer agreements when Schwab amended its customer account agreement to include a provision requiring customers to waive their rights to bring or participate in class actions against the firm." The agreement also included a provision requiring customers to agree that arbitrators in arbitration proceedings would not have the authority to consolidate more than one party's claims. FINRA's complaint charged that in October 2011, Schwab "amended its customer account agreement to include a provision requiring customers to waive their rights to bring or participate in class actions against the firm." Schwab sent the amended agreements to nearly 7 million customers, FINRA said in its original complaint. The Schwab waiver was also sent to clients of registered investment advisors that custody assets with Schwab. Unless the hearing panel's decision is appealed to FINRA's National Adjudicatory Council (NAC) or is called for review by the NAC, FINRA says the hearing panel's decision becomes final after 45 days. COLORADO: Douglas County Faces Class Action Over Teacher Layoffs ---------------------------------------------------------------- Julie Poppen, writing for EdNewsColorado, reports that the latest squabble to erupt in Douglas County schools is over teacher sick days and whether teachers who have been laid off due to budget cuts are getting a shot at other district teaching jobs. The Douglas County Federation of Teachers (DCFT) and the district's classified employees filed a lawsuit Feb. 15 in Douglas County District Court claiming that the school district illegally refused to consider teachers for job openings after their positions had been eliminated. A second complaint over the district's decision in July to scrap a bank of 10,000 teacher sick days was lumped with it, resulting in one lawsuit. Dougco school board President John Carson called the lawsuit "frivolous." "This is a union that has tried to flood the community with misinformation and political spin in an effort to tear down the excellent reputation of our schools and our teachers," Mr. Carson said in a statement. "We'll deal with this frivolous lawsuit directly. But we will not allow it to distract us from what public schools are actually about-educating kids for the 21st century." Mr. Carson accused the union of "trying to gain rights under a collective bargaining agreement that expired last summer due to its unwillingness to work collaboratively with the school district." DCFT President Brenda Smith disputed the district's comment about teachers not wanting to work collaboratively during contract talks. "That is absolutely false," Ms. Smith said. "The union -- time and time again -- tried to come to a resolution on the contract." Ms. Smith accused the district of violating Senate Bill 10-191, the state teacher effectiveness law, by not putting teachers who have been laid off due to downsizing in a priority hiring pool. Tenured teachers in that situation go through two hiring cycles before they are let go if they are not offered another district teaching job. During last year's hiring cycle, 10 veteran teachers who were laid off never even got interviews or return phone calls, Ms. Smith said. The district is in the second hiring cycle now. Six teachers attached their names to the class action lawsuit, she said. "They basically broke state law," Ms. Smith said. "Under state law, you have to have a priority hiring pool when you downsize . . . That means teachers displaced inside the system have priority for interviews when jobs come open." However, the system also requires "mutual consent," meaning both the teacher and the school principal must agree on the placement. "These are teachers who were downsized who didn't have any sort of evaluative issues," Ms. Smith said, noting that the 10 non- probationary teachers are now substitute teaching regularly. "If they don't get a job, then they're out of a position starting July 1." But the district contends it is following policy. "We followed the letter of the law and the process previously agreed to by DCFT," district spokeswoman Cinamon Watson said. "All displaced teachers were eligible to apply for any district opening and they were all interviewed or screened for the position by the hiring manager. Those displaced teachers that were not hired for an open position were reassigned as substitutes at no cut to their salary or benefits." Ms. Smith said the sick day issue is especially disturbing. Previously, teachers donated one sick day per year to a sick day bank. Those days could be shared with members facing severe illness. The bank was worth more than $850,000 when the district switched to a short-term disability system arguing it was a more financially prudent approach. The suit calls for the district to reimburse teachers for those sick days. "We'd had that for as long as we had a contract, for 40-plus years," Ms. Smith said. "(Short-term disability) does not cover the salary of a teacher while they're off. These do belong to teachers. (The district) did take them away without any sort of conversations." CONSUMER PORTFOLIO: Awaits Rulings on Judgment Bids in R.I. Suit ---------------------------------------------------------------- Consumer Portfolio Services, Inc. is awaiting court decisions on motions for summary judgment in the lawsuit pending in Rhode Island, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. The Company was for some time a defendant in a class action (the "Stanwich Case") brought in the California Superior Court, Los Angeles County. The original plaintiffs in that case were persons entitled to receive regular payments (the "Settlement Payments") pursuant to earlier settlements of claims, generally personal injury claims, against unrelated defendants. Stanwich Financial Services Corp. ("Stanwich"), which was an affiliate of the Company's former chairman of the board of directors, is the entity that was obligated to pay the Settlement Payments. Stanwich defaulted on its payment obligations to the plaintiffs and in June 2001 filed for reorganization under the Bankruptcy Code, in the federal bankruptcy court in Connecticut. By February 2005, the Company had settled all claims brought against it in the Stanwich Case. In November 2001, one of the defendants in the Stanwich Case, Jonathan Pardee, asserted claims for indemnity against the Company in a separate action, which remains pending in federal district court in Rhode Island. The Company has filed counterclaims in the Rhode Island federal court against Mr. Pardee, and have filed a separate action against Mr. Pardee's Rhode Island attorneys, in the same court. The litigation between Mr. Pardee and the Company was stayed for several years through September 2011, awaiting resolution of an adversary action brought against Mr. Pardee in the bankruptcy court, which is hearing the bankruptcy of Stanwich. Pursuant to an agreement with the representative of creditors in the Stanwich bankruptcy, that adversary action has been dismissed. Under that agreement, the Company paid the bankruptcy estate $800,000 and abandoned the Company's claims against the estate, and the estate has abandoned its adversary action against Mr. Pardee. With the dismissal of the adversary action, all known claims asserted against Mr. Pardee have been resolved without his incurring any liability. Accordingly, the Company believes that this resolution of the adversary action will result in limitation of the Company's exposure to Mr. Pardee to no more than some portion of his attorneys fees incurred. The stay in the action against the Company in Rhode Island has been lifted, and both the Company and Mr. Pardee have filed motions for summary judgment. Those motions were heard on October 25, 2012, and were taken under submission. The Company says it is not possible to predict when the court will rule, nor what its rulings on the motions may be. There is no trial date set. The reader should consider that an adverse judgment against the Company in the Rhode Island case for indemnification, if in an amount materially in excess of any liability already recorded in respect thereof, could have a material adverse effect on the Company's financial condition. COSTCO WHOLESALE: Faces Class Action Over Crab Spread Recall ------------------------------------------------------------ Juan Carlos Rodriguez, writing for Law360, reports that Costco Wholesale Corp. and GoldCoast Salads Inc. were hit on Feb. 20 with a proposed class action alleging that consumers were exposed to listeria-tainted crab spread that was eventually recalled. Plaintiff Lisa Grim claims she purchased GoldCoast Blue Crab Spread at a Rego Park, N.Y., Costco in January and soon afterward became seriously ill. The spread was recalled Feb. 1 by the company over concerns of listeria contamination. On Feb. 18, GoldCoast expanded the recall to include its Maine Lobster Spread, Lobster and Shrimp Spread, and Smoked Salmon. CVS CAREMARK: Appeal From Dismissal of Securities Suit Pending -------------------------------------------------------------- In November 2009, a securities class action lawsuit was filed in the United States District Court for the District of Rhode Island purportedly on behalf of purchasers of CVS Caremark Corporation stock between May 5, 2009, and November 4, 2009. The lawsuit names the Company and certain officers as defendants and includes allegations of securities fraud relating to public disclosures made by the Company concerning the pharmacy benefit management ("PBM") business and allegations of insider trading. In addition, a shareholder derivative lawsuit was filed in December 2009 in the same court against the directors and certain officers of the Company. A derivative lawsuit is a lawsuit filed by a shareholder purporting to assert claims on behalf of a corporation against directors and officers of the corporation. This lawsuit, which was stayed pending developments in the related securities class action, includes allegations of, among other things, securities fraud, insider trading and breach of fiduciary duties and further alleges that the Company was damaged by the purchase of stock at allegedly inflated prices under its share repurchase program. In January 2011, both lawsuits were transferred to the United States District Court for the District of New Hampshire. In June 2012, the court granted the Company's motion to dismiss the securities class action. The plaintiffs subsequently filed a notice of appeal of the Court's ruling on the motion to dismiss, and the appeal is pending. The derivative lawsuit will remain stayed pending the outcome of the appeal of the securities class action. No further updates were reported in the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. CVS CAREMARK: Appeals in "Lauriello" Class Suit Remain Pending -------------------------------------------------------------- Appeals in the class action lawsuit commenced by John Lauriello remain pending, according to CVS Caremark Corporation's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. Caremark was named in a putative class action lawsuit filed in October 2003 in Alabama state court by John Lauriello, purportedly on behalf of participants in the 1999 settlement of various securities class action and derivative lawsuits against Caremark and others. Other defendants include insurance companies that provided coverage to Caremark with respect to the settled lawsuits. The Lauriello lawsuit seeks approximately $3.2 billion in compensatory damages plus other non-specified damages based on allegations that the amount of insurance coverage available for the settled lawsuits was misrepresented and suppressed. A similar lawsuit was filed in November 2003 by Frank McArthur, also in Alabama state court, naming as defendants Caremark, several insurance companies, attorneys and law firms involved in the 1999 settlement. This lawsuit was stayed as a later-filed class action, but McArthur was subsequently allowed to intervene in the Lauriello action. Following the close of class discovery, the trial court entered an Order on August 15, 2012, that granted the plaintiffs' motion to certify a class pursuant to Alabama Rule of Civil Procedure 23(b)(3) but denied their request that the class also be certified pursuant to Rule 23(b)(1). In addition, the August 15, 2012 Order appointed class representatives and class counsel. The defendants have filed a notice of appeal with the Alabama Supreme Court and the plaintiffs have filed a notice of cross-appeal. The proceedings in the trial court are stayed by statute pending a decision on the appeal and cross-appeal by the Alabama Supreme Court. CVS CAREMARK: Continues to Defend PBM Antitrust Violations Suits ---------------------------------------------------------------- CVS Caremark Corporation continues to defend itself against lawsuits related to pharmacy benefit management, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. Various lawsuits have been filed alleging that Caremark has violated applicable antitrust laws in establishing and maintaining retail pharmacy networks for client health plans. In August 2003, Bellevue Drug Co., Robert Schreiber, Inc. d/b/a Burns Pharmacy and Rehn-Huerbinger Drug Co. d/b/a Parkway Drugs #4, together with Pharmacy Freedom Fund and the National Community Pharmacists Association filed a putative class action against Caremark in Pennsylvania federal court, seeking treble damages and injunctive relief. This case was initially sent to arbitration based on the contract terms between the pharmacies and Caremark. In October 2003, two independent pharmacies, North Jackson Pharmacy, Inc. and C&C, Inc. d/b/a Big C Discount Drugs, Inc., filed a putative class action complaint in Alabama federal court against Caremark and two pharmacy benefit management ("PBM") competitors, seeking treble damages and injunctive relief. The North Jackson Pharmacy case against two of the Caremark entities named as defendants was transferred to Illinois federal court, and the case against a separate Caremark entity was sent to arbitration based on contract terms between the pharmacies and Caremark. The Bellevue arbitration was then stayed by the parties pending developments in the North Jackson Pharmacy court case. In August 2006, the Bellevue case and the North Jackson Pharmacy case were both transferred to Pennsylvania federal court by the Judicial Panel on Multidistrict Litigation for coordinated and consolidated proceedings with other cases before the panel, including cases against other PBMs. Caremark appealed the decision which vacated an order compelling arbitration and staying the proceedings in the Bellevue case and, following the appeal, the Court of Appeals reinstated the order compelling arbitration of the Bellevue case. Following remand, plaintiffs in the Bellevue case sought dismissal of their complaint to permit an immediate appeal of the reinstated order compelling arbitration and pursued an appeal to the Circuit Court of Appeals. In November 2012, the Circuit Court reversed the district court ruling and directed the parties to proceed in federal court. Motions for class certification in the coordinated cases within the multidistrict litigation, including the North Jackson Pharmacy case, remain pending. The consolidated action is now known as the In Re Pharmacy Benefit Managers Antitrust Litigation. CYMER INC: Signs MOU to Settle Merger-Related Suit in Nevada ------------------------------------------------------------ Cymer, Inc. entered into a memorandum of understanding in December 2012 to settle a merger-related class action lawsuit, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. On October 16, 2012, the Company entered into the Agreement and Plan of Merger (the "Merger Agreement") by and among (i) ASML Holding N.V. ("ASML"), (ii) solely for purposes of Article II, Article IV, Article VI and Article X, ASML US Inc., a Delaware corporation and an indirect wholly owned subsidiary of ASML ("Holdco"), and Kona Technologies, LLC, a Nevada limited liability company and a wholly owned subsidiary of Holdco ("Merger Sub 2"), (iii) Kona Acquisition Company, Inc., a Nevada corporation and a wholly owned subsidiary of Holdco ("Merger Sub"), and (iv) the Company. The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will be merged with and into the Company, and immediately thereafter, the Company will be merged with and into Merger Sub 2. On October 29, 2012, a putative shareholder class action complaint was filed against Cymer, the Cymer Board, ASML, Holdco, Merger Sub and Merger Sub 2 in the District Court of Clark County, Nevada, captioned Jerome v. Cymer, Inc. et al., Case No. A-12-671009-C (Eighth Judicial Dist. Clark County, Nevada), challenging the Merger and seeking, among other things, compensatory damages, attorneys' and experts' fees and injunctive relief concerning the alleged breaches of fiduciary duty and to prohibit the defendants from consummating the Merger. The plaintiff subsequently amended the complaint on November 28, 2012. The lawsuit generally alleges, among other things, that the Merger Agreement was reached through an unfair process, that the merger consideration is inadequate, that the Merger Agreement unfairly caps the price of the Company's common stock, that the Merger Agreement's "no solicitation" provision and other deal protection devices have precluded other bidders from making successful competing offers for the Company, and that the preliminary proxy statement/prospectus filed in connection with the Merger contains material misstatements and/or omissions. The lawsuit alleges that ASML aided and abetted the alleged breaches of fiduciary duties. On December 31, 2012, the parties entered into a memorandum of understanding to settle the lawsuit. While the defendants believe that the lawsuit is without merit, in order to eliminate the burden, expense and uncertainties inherent in further litigation, the defendants have agreed, as part of the memorandum of understanding and without admitting to the validity of any allegations made in the lawsuit, to make certain additional disclosure requested by the plaintiff in the proxy statement/prospectus filed in connection with the Merger. The memorandum of understanding contemplates that the parties will enter into a stipulation of settlement. The stipulation of settlement will be subject to customary conditions, including certain confirmatory discovery and court approval following notice to the Company's stockholders. If the settlement is finally approved by the court, it will resolve and release all claims in all actions that were or could have been brought challenging any aspect of the Merger, the Merger Agreement, and any disclosure made in connection therewith (other than claims to enforce the settlement). In addition, the memorandum of understanding contemplates that, if the Merger is consummated and if the settlement is approved, Cymer or its successor shall be responsible for any attorneys' fees of the plaintiff that may be awarded by the District Court of Clark County, Nevada. There can be no assurance that the parties will ultimately enter into a stipulation of settlement or that the District Court of Clark County, Nevada will approve the settlement even if the parties were to enter into such stipulation. In such event, the proposed settlement as contemplated by the memorandum of understanding may be terminated. The Company does not expect the outcome of this lawsuit to have a material effect on operating results, financial condition and cash flow. DIRECTV: Faces Class Action for Unpaid Overtime ----------------------------------------------- Courthouse News Service reports that DirecTV stiffs workers for overtime, a class action claims in Superior Court. DOLE FOOD: Faces Class Action Over Misleading Product Labels ------------------------------------------------------------ Courthouse News Service reports that Dole Food Company deceptively labels its Salad Kit as "all natural," when in fact the product contains unnaturally processed and synthetic ingredients, a class claims ENBRIDGE ENERGY: Defends Class Suits Over Crude Oil Releases ------------------------------------------------------------ Enbridge Energy Partners, L.P. is defending itself against class action lawsuits arising from investigations into Line 6A and Line 6B crude oil releases, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. A number of governmental agencies and regulators have initiated investigations into the Line 6A and Line 6B crude oil releases. Approximately 30 actions or claims have been filed against the Company and its affiliates, in state and federal courts in connection with the Line 6B crude oil release, including direct actions and actions seeking class status. Based on the current status of these cases, the Company does not expect the outcome of these actions to be material. On July 2, 2012, the Pipeline and Hazardous Materials Safety Administration (PHMSA) announced a Notice of Probable Violation (NOPV) related to the Line 6B crude oil release, including a civil penalty of $3.7 million that the Company paid during the third quarter of 2012. FAMILY DOLLAR: Faces Suit Over Selling Shares at Inflated Price --------------------------------------------------------------- Courthouse News Service reports that Family Dollar Stores' CEO sold $15.6 million worth of shares at inflated prices before the company's declining sales became public and the share price dropped, shareholders claim in a federal class action. FOCUS MEDIA: Being Sold to Giovanna for Too Little, Suit Claims --------------------------------------------------------------- Iron Workers Mid-South Pension Fund, on Behalf of Itself and All Others Similarly Situated v. Focus Media Holding Limited, Jason Nanchun Jiang, Kit Leong Low, Neil Nanpeng Shen, Fumin Zhuo, Charles Guo Wei Cao, Daqing Qi, David Ying Zhang, Ying Wu, Giovanna Parent Limited and Giovanna Acquisition Limited, Case No. 3:13-cv-00827 (N.D. Cal., February 22, 2013) is a shareholder lawsuit arising from the Defendants' attempts to sell Focus Media to Giovanna for an alleged inadequate price following an unfair process. In agreeing to the Proposed Transaction, the Company's Board of Directors acted in an unfairly prejudicial and oppressive manner by failing to conduct a full and fair sales process designed to secure the best value available for the Company's shareholders, the Plaintiff contends. Indeed, the Plaintiff adds, the Board negotiated exclusively with Giovanna, an entity which is affiliated with Focus Media insider, Mr. Jiang, specifically deciding not to engage in an active shopping process. Iron Workers is a shareholder of Focus Media. Focus Media is a Cayman Islands corporation with principal executive offices in Central, Hong Kong. Focus Media is China's leading multi-platform digital media company, operating the largest LCD display network in China using audiovisual digital displays in commercial and residential locations. Focus Media operates in five networks including the LCD display network, poster frame network, in-store network, movie theater advertising network, and traditional outdoor billboards. The Individual Defendants are directors and officers of the Company. Giovanna is a Cayman Islands exempted company and a wholly owned subsidiary of Giovanna Intermediate Limited, which is a wholly owned subsidiary of Giovanna Group Holdings Limited, a company formed for the purpose of consummating certain transactions in connection with the Proposed Transaction. Merger Sub is a Cayman Islands exempted company and a wholly owned subsidiary of Giovanna. The Plaintiff is represented by: Brian J. Robbins, Esq. Stephen J. Oddo, Esq. Arshan Amiri, Esq. Edward B. Gerard, Esq. Justin D. Rieger, Esq. ROBBINS ARROYO LLP 600 B Street, Suite 1900 San Diego, CA 92101 Telephone: (619) 525-3990 Facsimile: (619) 525-3991 E-mail: brobbins@robbinsarroyo.com soddo@robbinsarroyo.com aamiri@robbinsarroyo.com egerard@robbinsarroyo.com jrieger@robbinsarroyo.com - and - Maria Cangemi, Esq. Christina Carroll, Esq. ROBEIN, URANN, SPENCER, PICARD & CANGEMI APLC 2540 Severn Avenue, Suite 400 Metairie, LA 70002 Telephone: (504) 885-9994 Facsimile: (504) 885-9969 E-mail: mcangemi@ruspclaw.com ccarroll@ruspclaw.com - and - Paul T. Warner, Esq. THE WARNER LAW FIRM 11123 McCracken Lane, Suite A Cypress, TX 77429 Telephone: (281) 664-7777 Facsimile: (281) 664-7774 E-mail: pwarner@warner-law.net GOLDCOAST SALADS: Recalls Additional Seafood Spread Products ------------------------------------------------------------ GoldCoast Salads, a Naples, Florida firm, is voluntarily recalling Blue Crab Spread, Maine Lobster Spread, Lobster and Shrimp Spread, and Smoked Salmon Spread that may be contaminated with Listeria. * The Blue Crab Spread being recalled is coded EXP 2/14/13 B. * The Maine Lobster Spread being recalled is coded EXP 2/16/13 LA. * The Lobster and Shrimp Spread being recalled is coded EXP 2/23/13 L&S1 and EXP 3/30/13 L&S1. * The Smoked Salmon Spread being recalled is coded 3/10/13 S2. The following products are being recalled: Blue Crab Spread in containers with a weight of 1 pound and containers with a weight of 8 ounces, Maine Lobster Spread in containers with a weight of 1 pound and containers with a weight of 8 ounces, Lobster and Shrimp Spread in containers with a weight of 1 pound and containers with a weight of 8 ounces, and Smoked Salmon Spread in containers with a weight of 1 pound and containers with a weight of 8 ounces. The products in question were produced 12/17/12, 12/19/12, 12/26/12, 1/31/13, and 1/25/13 respectively and distributed to stores in the North East and South East United States. Pictures of the recalled products' labels are available at: http://www.fda.gov/Safety/Recalls/ucm340645.htm Because of the potential for food borne illness, the Company urges consumers who have purchased the suspect products not to eat them, but to return them to the point of purchase. Consumers with questions about the recall should contact GoldCoast Salads by calling (239) 513-0430. For additional information, please contact: Peter Radno GoldCoast Salads Naples, FL 34117 Telephone: (239) 513-0430 HEARTLAND BRANDS: Recalls Two Varieties of Granola Cereals ---------------------------------------------------------- Heartland(R) Brands is voluntarily recalling two varieties of its granola cereals in the United States, Bahamas, Bermuda, Costa Rica, El Salvador, Israel and Trinidad, as a precaution due to the possible presence of fragments of flexible metal mesh in an ingredient. The ingredient is a grain blend, and the problem was discovered and reported by the ingredient supplier, Dakota Specialty Milling. The two Heartland(R) cereal varieties are: * Heartland(R) Harvest Spice Granola Cereal -- 14 oz.; UPC 024300 090394; Best If Used By dates from 20130326 (March 26, 2013) through 20130910 (Sept. 10, 2013). * Heartland(R) Fruit & Nut Harvest Granola Cereal -- 14 oz.; UPC 024300 090387; Best If Used By dates from 20130325 (March 25, 2013) through 20130910 (Sept. 10, 2013). Pictures of the recalled products are available at: http://www.fda.gov/Safety/Recalls/ucm340721.htm No other Heartland(R) brand products are involved in this recall. Heartland(R) Brands has not received any reports of consumer complaints or injuries and is issuing this voluntary recall as a precaution. Consumers who have purchased the recalled products are urged to discard the cereal but retain the Best If Used By code and contact the Company's Consumer Affairs Department toll-free at 888-881- 6769, Monday - Thursday, 8:00 a.m. - 6:00 p.m. Eastern Time and Friday, 8:00 a.m. - 4:00 p.m. Eastern Time, for a full refund of the purchase price. HERBALIFE INT'L: Recalls Healthy Meal Shake Mix for Milk Allergen ----------------------------------------------------------------- Herbalife International of America announced the voluntary recall of certain lots of its niche Instant Healthy Meal Nutritional Shake Mix packets because the label identifies the product as dairy-free, when it may in fact contain trace amounts of milk proteins. Individuals with severe allergies to milk run the risk of serious or life-threatening allergic reaction if they consume products containing milk proteins. Lactose intolerance is not a milk allergy and should not be confused with a milk protein allergy. The product was distributed in the U.S. from January 16, 2013, through February 16, 2013, exclusively to individual independent distributors as cartons of 12 packets or as single-serving packets in the company's introductory business pack (lot numbers 133405G10, 133408G10, & 133409G10). The lot code is printed on the pressed seal to the right side of the front panel of the Instant Healthy Meal Nutritional Shake Mix packet and at the bottom of the carton. Independent distributors are being contacted by telephone and US mail to alert them to this situation. Pictures of the recalled products' labels are available at: http://www.fda.gov/Safety/Recalls/ucm340887.htm The recall was initiated after it was discovered that certain lots contained unanticipated trace quantities of milk proteins. There have been no reports to date of any illnesses or adverse health effects associated with the affected products. The U.S. Food and Drug Administration has been notified of this voluntary recall. Independent distributors and their customers that have purchased this product are urged to return the product for exchange or refund. Consumers with questions about this issue may contact Herbalife's customer service department from 9:00 a.m. - 6:00 p.m., Pacific Standard Time, Monday - Friday, at 1-866-866-4744 Herbalife is dedicated to the health and safety of its consumers. Therefore, the Company initiated this voluntary recall. The Company apologizes to its distributors and their customers and sincerely regret any inconvenience created by this incident. About Herbalife Ltd. Herbalife Ltd. (NYSE:HLF) is a global nutrition company that sells weight-management, nutrition, and personal care products intended to support a healthy lifestyle. Herbalife products are sold in more than 80 countries to and through a network of independent distributors. The Company supports the Herbalife Family Foundation and its Casa Herbalife program to help bring good nutrition to children. Herbalife's Web site contains information about Herbalife, including financial and other information for investors at http://ir.Herbalife.com. The Company encourages investors to visit its Web site from time to time, as information is updated and new information is posted. HONEST KITCHEN: Recalls Verve(R), Zeal(R) and Thrive(R) Products ---------------------------------------------------------------- The Honest Kitchen announced that it is voluntarily recalling five lots of its Verve, Zeal and Thrive pet food products produced between August and November 2012 and sold nationwide in the US and Canada via retail stores, mail order and online after August 2012 because they have the potential to be contaminated with Salmonella. No other Honest Kitchen batches, production dates or products are affected. Healthy people infected with Salmonella should monitor themselves for some or all of the following symptoms: nausea, vomiting, diarrhea or bloody diarrhea, abdominal cramping and fever. Rarely, Salmonella can result in more serious ailments, including arterial infections, endocarditis, arthritis, muscle pain, eye irritation, and urinary tract symptoms. Consumers exhibiting these signs after having contact with this product should contact their healthcare providers. Animals with Salmonella infections may be lethargic and have diarrhea or bloody diarrhea, fever, and vomiting. Some animals will have only decreased appetite, fever and abdominal pain. Infected but otherwise healthy animals can be carriers and infect other animals or humans. If your animals have consumed the recalled product and have these symptoms, please contact your veterinarian. The Company is taking this action after learning that one of its raw ingredients suppliers has recalled a batch of human-grade parsley that may contain Salmonella. The batch of parsley was shipped to the Company in 2012 and used in the production of five lots of finished Honest Kitchen products. The Honest Kitchen regularly tests for Salmonella and other pathogens as part of its quality control process and has not received to date any reports of illness associated with these lots of products. Nonetheless, the Company is proceeding with this action in order to ensure the full safety and quality of its products. "We are committed to providing the highest-quality human-grade food available to our customers' pets," said Lucy Postins, founder, CEO and CMO of The Honest Kitchen. "While our quality control tests did not find evidence of Salmonella in any of our finished products, we are accountable for everything we make, and are taking precautionary action to ensure the safety and integrity of our products." The lots being recalled are: Product Production Expiration Item Code Name Date Date Size --------- ------- ---------- ---------- ---- V4 + VR VERVE 08/20/12 08/20/13 4 lb. box, Lot Number: 2332A (batches 1-3) 10 lb. box VR VERVE 11/01/12 11/01/13 10 lb. box Lot Number: 3062A (batches 8 & 9) TM THRIVE 09/18/12 09/18/13 1 oz. sample Lot Number: 2622A (batch 3) Z4 + ZR ZEAL 08/14/12 08/14/13 4 lb. box, Lot Number: 2272A (batches 1?5) 10 lb. box ZR ZEAL 09/21/12 09/21/13 10 lb. box Lot Number: 2652A (batches 1?4) Consumers who purchased the above lots of Honest Kitchen Verve, Zeal or Thrive products should stop feeding the products to their pets, remove the UPC (bar code) and lot code from the packaging, and discard the contents in a covered trash receptacle. Lot codes are located on the top of product boxes either adjacent to or opposite the UPC. Pictures of the recalled products' labels are available at: http://www.fda.gov/Safety/Recalls/ucm340673.htm Consumers can receive a replacement or full refund of the MSRP of the affected products plus $1 to cover postage, by mailing the UPC and lot code along with a completed Reimbursement Form to The Honest Kitchen, 145 14th Street, San Diego, California 92101, Attn: Reimbursements. All refunds will be processed within five business days (plus postage time). The Honest Kitchen products use human-food grade ingredients. The Company's products are made in a human food facility and held to the same high quality control standards as human food products. Employees taste products as part of the quality control and research & development processes. To supplement its quality control processes while maintaining its commitment to gentle processing that protects natural nutrients, The Honest Kitchen is enacting additional procedures: * All dehydrated leafy greens will be steamed, to further protect against the possibility of Salmonella and other pathogens; * All leafy greens will receive a second test for pathogens after arrival at the Company's manufacturing facility, in addition to the testing conducted internally by suppliers; * The Company has discontinued its relationship with the supplier who provided the parsley used in the production of the lots being recalled. For questions or more information, contact The Honest Kitchen by phone at 1-866-437-9729 or e-mail at info@thehonestkitchen.com. Customer service representatives will be available Monday through Friday, 8:00 a.m. to 4:00 p.m. Pacific Standard Time to respond to inquiries. HONEYWELL INT'L: Continues to Defend "UAW" Suit in Michigan ----------------------------------------------------------- Honeywell International Inc. continues to defend itself from a class action lawsuit filed by the United Auto Workers, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. In July 2011, Honeywell filed an action, Honeywell v. United Auto Workers ("UAW") et al., in federal court (District of New Jersey) against the UAW and all former employees who retired under a series of Master Collective Bargaining Agreements ("MCBAs") between Honeywell and the UAW. The Company is seeking a declaratory judgment that certain express limitations on its obligation to contribute toward the healthcare coverage of such retirees (the "CAPS") set forth in the MCBAs may be implemented, effective January 1, 2012. In September 2011, the UAW and certain retiree defendants filed a motion to dismiss the New Jersey action and filed a lawsuit in the Eastern District of Michigan alleging that the MCBAs do not provide for CAPS on the Company's liability for healthcare coverage. The UAW and retiree plaintiffs subsequently filed a motion for class certification and a motion for partial summary judgment in the Michigan action, seeking a ruling that retirees who retired prior to the initial inclusion of the CAPS in the 2003 MCBA are not covered by the CAPS as a matter of law. In December 2011, the New Jersey action was dismissed on forum grounds. Honeywell appealed the New Jersey court's dismissal to the United States Court of Appeals for the Third Circuit. The Third Circuit denied the appeal. Honeywell has now answered the UAW's complaint in Michigan and has asserted a counterclaim for fraudulent inducement. Honeywell is confident that the CAPS will be upheld and that its liability for healthcare coverage premiums with respect to the putative class will be limited as negotiated and expressly set forth in the applicable MCBAs. In the event of an adverse ruling, however, Honeywell's other postretirement benefits for pre-2003 retirees would increase by approximately $175 million, reflecting the estimated value of these CAPS. Given the uncertainty inherent in litigation and investigations, the Company does not believe it is possible to develop estimates of reasonably possible loss in excess of current accruals for these matters (other than as specifically set forth). Considering the Company's past experience and existing accruals, it does not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on the Company's consolidated financial position. Because most contingencies are resolved over long periods of time, potential liabilities are subject to change due to new developments, changes in settlement strategy or the impact of evidentiary requirements, which could cause the Company to pay damage awards or settlements (or become subject to equitable remedies) that could have a material adverse effect on the Company's results of operations or operating cash flows in the periods recognized or paid. HONEYWELL INT'L: Has Final Approval of Quick Lube MDL Settlement ---------------------------------------------------------------- Honeywell International Inc. received in November 2012 final approval of its settlement of the multidistrict litigation brought by S&E Quick Lube, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. On March 31, 2008, S&E Quick Lube, a filter distributor, filed a lawsuit in U.S. District Court for the District of Connecticut alleging that 12 filter manufacturers, including Honeywell, engaged in a conspiracy to fix prices, rig bids and allocate U.S. customers for aftermarket automotive filters. This lawsuit is a purported class action on behalf of direct purchasers of filters from the defendants. Parallel purported class actions, including on behalf of indirect purchasers of filters, have been filed by other plaintiffs in a variety of jurisdictions in the United States and Canada. The U.S. cases have been consolidated into a single multi-district litigation in the Northern District of Illinois. In June 2011, plaintiff's principal witness pled guilty to a felony count of having made false statements to federal investigators. On March 8, 2012, Honeywell entered into a settlement agreement to resolve the multi-district litigation class action as to all plaintiffs. On October 10, 2012, and November 28, 2012, the District Court for the Northern District of Illinois issued orders granting final approval of the U.S. multi- district litigation settlement as to all plaintiffs. The Antitrust Division of the Department of Justice notified Honeywell in January 2010 that it had officially closed its investigation into possible collusion in the replacement auto filters industry. The class action in Canada is still pending but the Company does not expect the resolution to have a material impact on its results of operations or operating cash flows in the periods recognized or paid. HY-VEE INC: Recalls Dog Food Products Due to Chemical Contaminant ----------------------------------------------------------------- Hy-Vee, Inc. issued a voluntary recall of certain bags of Hy-Vee dog food due to elevated levels of a chemical contaminant commonly found in corn. Routine random tests conducted by the Iowa Department of Agriculture indicated higher-than-normal levels of aflatoxin in some samples of Hy-Vee dog food produced at a Kansas City plant operated by Pro-Pet, LLC. Hy-Vee officials emphasized the recall is voluntary and only conducted as a precautionary measure. No illnesses have been reported in dogs consuming the product, and the product does not pose a health risk to humans handling it. Hy-Vee officials have also removed all potentially affected products from Hy-Vee stores. The recalled products carry three different "Best By" dates and were distributed to Hy-Vee stores in Iowa, Illinois, Missouri, Kansas, Nebraska, South Dakota, Minnesota and Wisconsin between October 26, 2012, and January 11, 2013. The following products are subject to the recall: * Hy-Vee Complete Dog - Complete Nutrition (Green Bag) ? 34-lb. UPC: 07545005647 Lot # ending with: 29812KC "Best By" Date: 11/24/13 * Hy-Vee Complete Dog ? Complete Nutrition (Green Bag) ? 8-lb UPC: 07545005667 Lot # ending with: 29812KC "Best By" Date: 11/24/13 * Hy-Vee Complete Dog ? Complete Nutrition (Green Bag) ? 4.4-lb. UPC: 07545005665 Lot # ending with: 29812KC "Best By" Date: 11/24/13 * Hy-Vee Complete Dog ? Complete Nutrition (Green Bag) ? 4.4-lb. UPC: 07545005665 Lot # ending with: 29912KC "Best By" Date: 11/25/13 * Hy-Vee Complete Dog ? Bites, Bones & Squares (Yellow Bag) ? 20-lb. UPC: 07545005680 Lot # ending with: 29312KC "Best By" Date: 11/19/13 * Hy-Vee Complete Dog ? Bites, Bones & Squares (Yellow Bag) ? 4.4-lb. UPC: 07545005560 Lot # ending with: 29312KC "Best By" Date: 11/19/13 The recall is limited to the products, sizes and code dates listed above. No other Hy-Vee dog food products or code dates are affected by the recall. Customers are urged to check the "Best By" dates on any product they have at home and refrain from feeding any of the recalled products to their pets. Any bags of Hy-Vee dog food subject to the recall, whether opened or unopened, may be returned to Hy-Vee stores for a full refund. Aflatoxin is a naturally occurring chemical produced by the mold fungus Aspergillus, which is often found in corn, particularly during drought conditions. Pets that ingest higher-than-normal levels of aflatoxin, especially over a period of time, may become ill. Consumers who are concerned about illness in their pets as a result of consuming aflatoxin should contact their veterinarians. Hy-Vee, Inc. -- http://www.hy-vee.com/-- is an employee-owned corporation operating 233 retail stores in eight Midwestern states. For 2012 the Company recorded sales of $7.7 billion, ranking it among the top 25 supermarket chains and the top 50 private companies in the United States. ILLINOIS: Ex-Madison County Treasurer Faces Suit Over Tax Auctions ------------------------------------------------------------------ Brian Brueggemann, writing for BND.com, reports that a lawsuit seeking class-action status has been filed against Madison County over former treasurer Fred Bathon's handling of the annual delinquent tax sales. Mr. Bathon has pleaded guilty in federal court to a criminal charge of rigging the tax sale so that his political donors profited from inflated penalties paid by property owners. The class-action suit was filed on Feb. 21 in Madison County by St. Jacob attorney John Barberis and Collinsville attorney Steve Giacoletto. For now, the only named plaintiffs are Scott and Dawn Bueker, of St. Jacob, Jason and Christine Moss, of Collinsville, and Guideon Richeson, of Troy. But the plaintiffs are asking the court to certify the suit as a class action on behalf of any Madison County property owners whose tax bills were included in the county's tax sales from 2005 to 2009. Prosecutors have said there were roughly 10,000 tax bills affected. The suit does not yet seek specific amounts in damages, but rather an awarding of money for "all losses and injuries suffered" as a result of the scheme. The suit says property owners have lost, or stand to lose, "millions of dollars in interest which has been artificially inflated due to the defendants' illegal conduct." Named as defendants, along with the county, are Mr. Bathon and certain buyers of the delinquent tax bills: John Vassen, Dennis Ballinger, Robert Luken, John Scott, Scott McClean and Edward Beasley. Madison County Board Chairman Alan Dunstan was not immediately available for comment on Feb. 21. The tax buyers have previously declined comment. Mr. Bathon pleaded guilty earlier this month to rigging the tax sale from 2005 to 2009, so that investors who gave him political contributions would be able to charge high penalties. He faces up to 41 months in prison when he is sentenced in May. At the county's annual tax sale, investors buy the right to pay the delinquent taxes of property owners. Property owners who don't repay the taxes as well as a penalty to the investors can lose their property. The penalty rate is supposed to be determined through competitive bidding, to see which investor is willing to accept the lowest rate. In most counties, the tax bills are sold in a reverse auction, where the investor offering to take the lowest penalty rate is the winning bidder. The process is supposed to ensure that property owners aren't charged excessive penalties for paying their taxes late. However, witnesses say Mr. Bathon conducted his tax sales like a bid opening, where investors were not allowed to undercut each other or "bid down" the penalty percentage. Under Mr. Bathon's procedure, all the bidders would shout an opening bid. The one who shouted the lowest bid first was declared the winner. Federal prosecutors say Mr. Bathon's procedure resulted "in a chaotic scene where every participant at the tax sale shouted their bids simultaneously, leaving the auctioneer, a treasurer's office employee, to select the 'winner.'" The average penalty rate in three of the years was either 17 percent or 18 percent, the maximum allowable under state law. In two of the years, the bid-rigging was so pervasive that the 18 percent penalty rate was awarded for almost all of the roughly 5,000 properties affected in those years. Prosecutors say some of the tax buyers "colluded" with Mr. Bathon, and the investigation into the scheme is ongoing. Current Treasurer Kurt Prenzler conducted the county's annual tax sale earlier this week, and the average penalty rate was 3.7 percent. All three of the tax sales conducted under Mr. Prenzler's tenure have produced average penalty rates below 4 percent. Mr. Prenzler said a penalty rate of 18 percent packs a wallop, especially if the property owner doesn't immediately pay his debt, because the penalties compound over time. "Interest rates of 18 percent were bad, but it got worse. If a person's taxes were sold at 18 percent, and they didn't redeem their taxes within the first two and a half years, the interest rate could get up to 108 percent. If their taxes are sold at 3 percent, and they don't pay during the first two and a half years, it can go no higher than 18 percent. You can see the difference," Mr. Prenzler said. Mr. Prenzler has said the scheme cost property owners millions of dollars in inflated penalties and lost equity. KING ARTHUR: Recalls Flour Over Presence of Polyurethane Balls -------------------------------------------------------------- King Arthur Flour has initiated a voluntary recall of a limited number of its bags of flour due to the possible presence of small (7-9 mm) blue polyurethane balls that are used in the sifting process. The balls have a smooth surface and no sharp edges and are made from food grade material. Because of their bright blue color and size (about half the diameter of a dime), they are easily seen in the flour. Only 5-lb. bags of King Arthur Unbleached All-Purpose Flour and King Arthur Unbleached Bread Flour that have a Best Used By Date and Lot Codes noted below are affected. This information is printed on the side of the bag beneath the nutrition panel. If the Best Used By Date and Lot Code number are printed on the TOP of the bag, then the product is NOT affected. The following two (2) King Arthur Flour products are included in the voluntary recall: * King Arthur Unbleached All-Purpose Flour, 5-lb. bag, UPC 0-71012-01050-9 With the combination of both the Best Used By Date plus Lot Code beneath nutrition facts panel Best Used By Lot Code ------------ -------- 12/26/2013 L12A26B 12/26/2013 L12A26C 12/27/2013 L12A27A 01/18/2014 A13A18A 01/18/2014 A13A18B 01/21/2014 A13A21A 01/22/2014 A13A22B 01/30/2014 A13A30A 01/31/2014 A13A31A * King Arthur Unbleached Bread Flour, 5-lb. bag, UPC 0-71012-04105-3 With the combination of both the Best Used By Date plus Lot Code beneath nutrition facts panel Best Used By Lot Code ------------ -------- 12/26/2013 L12A26A 12/26/2013 L12A26B 01/03/2014 A13A03A 01/03/2014 A13A03B 01/16/2014 A13A16B 01/17/2014 A13A17A 01/23/2014 A13A23A 01/28/2014 A13A28A 01/31/2014 A13A31A Pictures of the recalled products' labels are available at: http://www.fda.gov/Safety/Recalls/ucm340873.htm No other lot codes of this product or any other King Arthur Flour products are affected in any way. There have been no reports of injury, ingestion or presence of any of these balls from the Company's customers to date. This voluntary recall is based on the possibility that a ball could be found. Any products with a combination of the Best Used By and Lot Code noted above may be returned to the store for a full refund. For more information call the King Arthur Flour Consumer Hotline at 866.797.9178, open Monday - Friday 9:00 a.m. to 6:00 p.m. Eastern Standard Time. For convenience, a Lot Code check form and copy of this press release is available at http://www.kingarthurflour.com/voluntaryrecall. King Arthur Flour CEO Steve Voigt assures customers that this is an isolated occurrence. "King Arthur Flour is adamant about quality and safety. A very limited number of our flour bags are affected by this incident; but we wanted to be sure our customers are aware of the recall, and know how to check their flour to see if it's involved." KUMQUAT PROPERTIES: Failed to Secure 66 Pearl Premises, Suit Says ----------------------------------------------------------------- Joseph Astill, individually and on behalf of all other similarly situated Plaintiffs v. Kumquat Properties, LLC, Partners 66, LLC and Lawrence Properties, Inc., Case No. 151650/2013 (N.Y. Sup. Ct., February 22, 2013) is brought on behalf of similarly situated residential tenants of the premises at 66 Pearl Street, in New York. The Plaintiff seeks damages for his claims arising out of the Defendants' alleged (i) failure to exercise due care to adequately secure, protect or otherwise care for the real property located at 66 Pearl Street subsequent to multiple warnings issued by the National Hurricane Center and by New York City government officials for residents of lower Manhattan prior to "Superstorm Sandy," and (ii) negligence relating to their failure to mitigate damages before, during and subsequent to the Storm. Mr. Astill is a resident of New York County. The proposed class consists of all residential tenants of 66 Pearl Street as of October 29, 2012. Kumquat is a domestic limited liability company. Partners 66 is a domestic limited liability company. Lawrence is a New York corporation. The Defendants are based in New York City. At all relevant times, Lawrence was retained by Kumquat and Partners 66 to act as the managing agent for the property located at 66 Pearl Street. The Plaintiff is represented by: Hunter Shkolnik, Esq. Adam J. Gana, Esq. NAPOLI, BERN, RIPKA & SHKOLNIK, LLP 350 Fifth Avenue, Suite 7413 New York, NY 10118 Telephone: (212) 267-3700 Facsimile: (212) 587-0031 E-mail: Hunter@NapoliBern.com Agana@NapoliBern.com - and - Jeanne Christensen, Esq. Vincent Imbesi, Esq. IMBESI CHRISTENSEN 450 Seventh Avenue, Suite 3002 New York, NY 10123 Telephone: (212) 736-0007 Facsimile: (212) 658-9177 E-mail: jchristensen@lawicm.com vimbesi@lawicm.com LENOVO GROUP: Faces Class Action Over Slow Notebook Computers ------------------------------------------------------------- Courthouse News Service reports that Lenovo IdeaPad U Series, Ultrabook and Ultraportable notebook computers are too slow for wi-fi Internet browsing, a class action claims in Federal Court. LOCKHEED MARTIN: Workers File Class Action Over Labor Violations ---------------------------------------------------------------- Courthouse News Service reports that Lockheed Martin stiffs workers for overtime, a class action claims in Superior Court. MANDY STAR: Recalls "Good Taste" Preserved Fruits Over Sulfites --------------------------------------------------------------- New York State Agriculture Commissioner Darrel J. Aubertine alerted consumers that Mandy Star Trading Inc. located at 351 Maujer Street in Brooklyn, NY, is recalling "Good Taste" brand preserved fruits due to the presence of undeclared sulfites. No illnesses have been reported to date in connection with this product. People who have severe sensitivity to sulfites may run the risk of serious or life-threatening reactions if they consume this product. The recalled "Good Taste" brand preserved fruits are packaged in a 14 oz. (400 gram), plastic bag. There is no apparent production code on the package, but a UPC code of 3 867320 507698 can be found on the back of the package. Pictures of the recalled products are available at: http://www.fda.gov/Safety/Recalls/ucm340638.htm Routine sampling by New York State Department of Agriculture and Markets Food Inspectors and subsequent analysis of the product by Food Laboratory personnel revealed the product contained high levels of sulfites which were not declared on the label. The consumption of 10 milligrams of sulfites per serving has been reported to elicit severe reactions in some asthmatics. Anaphylactic shock could occur in certain sulfite sensitive individuals upon ingesting 10 milligrams or more of sulfites. Consumers who have purchased "Good Taste" brand preserved fruits should contact Mandy Chen at Mandy Star Trading Inc. at (646) 204- 5888. MONDELEZ GLOBAL: Recalls 2 Varieties of belVita Breakfast Biscuit ----------------------------------------------------------------- Mondelez Global LLC announced a nationwide voluntary recall in the United States, including Puerto Rico, of the belVita Breakfast Biscuit product, Apple Cinnamon and Chocolate varieties, following notification from a third-party supplier, due to the possible presence of fragments of flexible metal mesh caused by a faulty screen at their facility. The following product is being recalled: Best When Description Retail UPC Used By Dates ----------- ---------- ------------- belVita Breakfast Biscuit, 0 44000 03192 3 21 Jan 13 ? Chocolate Variety, 1.76 oz 29 Sep 13 (bottom of package) belVita Breakfast Biscuit, 0 44000 03194 7 21 Jan 13 ? Chocolate Variety, 8.8 oz 29 Sep 13 (top of package) belVita Breakfast Biscuit, 0 44000 03163 3 16 May 13 ? Chocolate Variety, 14.08 oz 13 Sep 13 (side of package) belVita Breakfast Biscuit, 0 44000 02824 4 8 Oct 12 ? Apple Cinnamon Variety, 1.76 oz 2 Sep 13 (bottom of package) belVita Breakfast Biscuit, 0 44000 02825 1 8 Oct 12 ? Apple Cinnamon Variety, 8.8 oz 2 Sep 13 (top of package) Pictures of the recalled products' labels are available at: http://www.fda.gov/Safety/Recalls/ucm340677.htm This recall is limited exclusively to the belVita Breakfast Biscuit, Apple Cinnamon and Chocolate varieties, manufactured and sold in the United States, including Puerto Rico. No other belVita product is included in this recall. Consumers who have this product should not eat it and should discard any products they may have. Consumers can contact the Company at 1-877-799-5633, 24 hours a day to get more information about the recall, and Consumer Relations specialists are available Monday - Friday, 9:00 a.m. to 6:00 p.m. Eastern Standard Time. The Company has received a limited number of consumer contacts related to this product, and is issuing the recall as a precaution. NEW YORK: Gun Owners Mull Class Action Over State's SAFE Act ------------------------------------------------------------ WIVB reports that as county lawmakers take a stand against Governor Andrew Cuomo's NY SAFE Act, gun owners are planning a strategy they hope will restore their right to bear arms. Dozens turned out to a meeting on Feb. 21 in West Seneca. Gun owners there lauded one lawyer who's fighting to get the law overturned. "It was done unfairly. I feel it's unconstitutional. We weren't given the proper amount of time and there's a lot of things in there that are penalizing legal gun owners as myself," said one gun owner. Ian Calder is a gun owner who signed a petition for representation in a class action lawsuit against the state and state leaders. Jim Tresmond filed the lawsuit. He is demanding a jury determine the constitutionality of the SAFE Act and calls it the closest thing to a public referendum on the law. "The big deal is whether or not they can maintain their guns that they bought prior to this law," Mr. Tresmond said. Mr. Tresmond says he plans on calling Governor Cuomo as a witness in this case, but the governor says he's not trying to take guns away from anyone. In fact, he says he anticipates tweaking the bill. And on Feb. 21, Erie County legislators voted to send a message to Governor Cuomo. They don't want the act tweaked, they want the law overturned. Democratic Legislator Thomas Loughran. "My hope is that it does send a message to have a more open process." Mr. Loughran joined Democrat Terrence McCracken and the GOP minority to pass the resolution. "It's like a truck rolling down hill. Somebody is putting the brakes on so it stops and that's what will happen with this onerous law," Mr. Tresmond said. So far, this is the only lawsuit filed in NYS. But Mr. Tresmond says it will be a long and arduous process for he and his legal team. They expect to fight this battle in courts over the next two years. NORFOLK SOUTHERN: Awaits Ruling in Fuel Surcharges MDL Appeal ------------------------------------------------------------- Norfolk Southern Corporation is awaiting a court decision on its appeal in the antitrust multidistrict litigation pending in the District of Columbia, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. On November 6, 2007, various antitrust class actions filed against the Company and other Class I railroads in various Federal district courts regarding fuel surcharges were consolidated in the District of Columbia by the Judicial Panel on Multidistrict Litigation. On June 21, 2012, the court certified the case as a class action. The defendant railroads have appealed such certification, and a decision by the court to either reject the appeal outright or proceed with ruling on its merits is pending. The Company believes the allegations in the complaints are without merit and intends to vigorously defend the cases. The Company does not believe the outcome of these proceedings will have a material effect on its financial position, results of operations, or liquidity. A lawsuit containing similar allegations against the Company and four other major railroads that was filed on March 25, 2008, in the U.S. District Court for the District of Minnesota was voluntarily dismissed by the plaintiff subject to a tolling agreement entered into in August 2008. Norfolk Southern Corporation -- http://www.nwpipe.com/-- is a transportation company. Its Norfolk Southern Railway subsidiary operates approximately 20,000 route miles in 22 states and the District of Columbia, serves every major container port in the eastern United States, and provides efficient connections to other rail carriers. Norfolk Southern operates the most extensive intermodal network in the East and is a major transporter of coal and industrial products. The Company is based in Norfolk, Virginia. OHIO: Cuyahoga County Exec Faces Class Action Over Pay Cuts ----------------------------------------------------------- Eric Sandy, writing for Scene and Heard, reports that on behalf of all classified civil service employees of Cuyahoga County, Warren Dolezal, Jack Gallagher and Jeffrey Dobransky filed a class action lawsuit against County Executive Ed FitzGerald this month. The three men allege that, since Jan. 1, 2010, they've seen compensation reduced either without cause or based on age or political inclinations. Via the lawsuit, they are seeking the restoration of pay, relief from any forms of discrimination (age and/or political, in most cases) and a declaration that bullshit tactics like that will not continue. When Mr. FitzGerald and the new charter form of county government showed up to work in January 2011, the incoming executive promised a world of transparency and a general departure from the questionable dealings of his predecessors. (Meanwhile, Fitz's alternate moniker "Public Official 14" ensures that the past remains firmly entrenched in the present.) As far as the plaintiffs in this case go, Mr. Dolezal is a 22-year veteran of the Public Works Department. With no disciplinary history under his belt, he was reclassified downward in 2012 and his pay was slashed by 13 percent. In the end, his duties and workload remained the same, he alleges. Mr. Gallagher is a 28- year veteran of the Department of Weights and Measures. Similarly, in mid-2012, his classification was lowered and his pay was dropped by 13.5 percent. Lastly, Mr. Dobransky is a 27-year veteran of the Public Works Department, working as a bridge inspector. His pay was cut by 10 percent during a reclassification move last year. According to the text of the lawsuit, Mr. FitzGerald did not set forth any of the relevant criteria in declassifying the plaintiffs' employment. Those criteria include, per Ohio Revised Code, incompetency, inefficiency, dishonesty, drunkenness, immoral conduct, insubordination, discourteous treatment of the public, neglect of duty, violation of any policy or work rule of the officer's or employee's appointing authority, or violation of ORC Section 124.34, which goes on to greater detail and so forth. And interestingly enough, the Ohio Administrative Code has this to say about reclassification and pay rates: "An employee that is assigned into a lower classification shall be placed in the step within the new pay range that provides the employee with compensation that is equal to his or her current rate or that provides the least amount of increase, but no decrease, in pay. Appointing authorities shall consider all applicable pay supplements to ensure that an employee reassigned pursuant to this rule does not receive a decrease in pay. The road through the Cuyahoga County Court of Common Pleas seems overly rocky, however. The county's Human Resources Department holds a mighty hand, through tinkering with classification descriptions and ensuring that employees' claims of disparity encounter a formidable burden of proof. And since no employee was reclassified due to disciplinary action, that cannot form the basis of an appeal to the civil service commission. The Plain Dealer, for its part, posted the story on cleveland.com at 6:00 a.m. on Feb. 16. It's what we in the biz like to call a weekend news dump . . . Although, typically it's the public relations department of an organization leaking controversial news to the media during off-hours in those cases, not a major metro daily. PANERA BREAD: Cal. Court OK'd Attorneys' Fees in "Sotoudeh" Suit ---------------------------------------------------------------- The California Superior Court, County of Contra Costa, approved earlier this month the attorneys' fees and costs in the consolidated class action lawsuit brought by Nick Sotoudeh and David Carter, according to Panera Bread Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 25, 2012. On December 9, 2009, a purported class action lawsuit was filed against the Company and one of its subsidiaries by Nick Sotoudeh, a former employee of a subsidiary of Panera Bread Company. The lawsuit was filed in the California Superior Court, County of Contra Costa. On April 22, 2011, the complaint was amended to add another former employee, Gabriela Brizuela, as a plaintiff. The complaint alleged, among other things, violations of the California Labor Code, failure to pay overtime, failure to provide meal and rest periods and termination compensation and violations of California's Business and Professions Code. The complaint sought, among other relief, class certification of the lawsuit, unspecified damages, costs and expenses, including attorneys' fees, and such other relief as the Court determines to be appropriate. On November 17, 2011, the parties entered into a Memorandum of Agreement regarding settlement of this purported class action lawsuit and the purported class action lawsuit filed by David Carter. Under the terms of the Memorandum of Agreement, the parties agreed to settle this matter for a maximum aggregate amount of $5.0 million for settlement payments to purported class members, plaintiffs' attorneys' fees, and costs of administering the settlement. The Memorandum of Agreement contains no admission of wrongdoing. The terms and conditions of the settlement were preliminarily approved by the Court on June 8, 2012. At a hearing on December 21, 2012, the Court approved the terms and conditions of the settlement and the actual settlement payment amounts, except for plaintiffs' attorneys' fees and costs, which were approved by the Court at a separate hearing on February 5, 2013. Based upon the Court approved settlement amounts and the amount of attorneys' fees and costs sought by plaintiffs' counsel, the Company maintained a reserve of $3.7 million in accrued expenses in the Company's Consolidated Balance Sheets as of December 25, 2012. Carter Lawsuit On July 22, 2011, a purported class action lawsuit was filed against the Company and one of its subsidiaries by David Carter, a former employee of a subsidiary of Panera Bread Company, and Nikole Benavides, a purported former employee of one of the Company's franchisees. The lawsuit was filed in the California Superior Court, County of San Bernardino. The complaint alleges, among other things, violations of the California Labor Code, failure to pay overtime, failure to provide meal and rest periods and termination compensation and violations of California's Business and Professions Code. The complaint sought, among other relief, collective and class certification of the lawsuit, unspecified damages, costs and expenses, including attorneys' fees, and such other relief as the Court determines to be appropriate. This matter against the Company's subsidiary was consolidated with the Sotoudeh lawsuit and is the subject of the Memorandum of Agreement. PILGRIMS PRIDE: Hearing on Class Certification Bid on Feb. 28 ------------------------------------------------------------- A hearing on a motion for class certification in the consolidated class action lawsuit alleging violations of the Employee Retirement Income Security Act of 1974 is scheduled for February 28, 2013, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. On December 17, 2008, Kenneth Patterson filed a lawsuit in the U.S. District Court for the Eastern District of Texas, Marshall Division, against Lonnie "Bo" Pilgrim, Lonnie Ken Pilgrim, Clifford E. Butler, J. Clinton Rivers, Richard A. Cogdill, Renee N. DeBar, the Company's Compensation Committee and other unnamed defendants (the "Patterson action"). On January 2, 2009, a nearly identical lawsuit was filed by Denise M. Smalls in the same court against the same defendants (the "Smalls action"). The complaints in both actions, brought pursuant to section 502 of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 US C. Section 1132, alleged that the individual defendants breached fiduciary duties to participants and beneficiaries of the Pilgrim's Pride Stock Investment Plan (the "Stock Plan"), as administered through the Pilgrim's Pride Retirement Savings Plan (the "RSP"), and the To-Ricos, Inc. Employee Savings and Retirement Plan (the "To-Ricos Plan") (collectively, the "Plans") by failing to sell the common stock held by the Plans before it declined in value in late 2008, based on factual allegations similar to the allegation made in the Acaldo securities case. Patterson and Smalls further alleged that they purported to represent a class of all persons or entities who were participants in or beneficiaries of the Plans at any time between May 5, 2008, through the present and whose accounts held the Company's common stock or units in its common stock. Both complaints sought actual damages in the amount of any losses the Plans suffered, to be allocated among the participants' individual accounts as benefits due in proportion to the accounts' diminution in value, attorneys' fees, an order for equitable restitution and the imposition of constructive trust, and a declaration that each of the defendants have breached their fiduciary duties to the Plans' participants. On July 20, 2009, the Court entered an order consolidating the Smalls and Patterson actions. On August 12, 2009, the Court ordered that the consolidated case will proceed under the caption "In re Pilgrim's Pride Stock Investment Plan ERISA Litigation, No. 2:08-cv-472-TJW." Patterson and Smalls filed a consolidated amended complaint ("Amended Complaint") on March 2, 2010. The Amended Complaint names as defendants the Pilgrim's Pride Board of Directors, Lonnie "Bo" Pilgrim, Lonnie Ken Pilgrim, Charles L. Black, Linda Chavez, S. Key Coker, Keith W. Hughes, Blake D. Lovette, Vance C. Miller, James G. Vetter, Jr., Donald L. Wass, J. Clinton Rivers, Richard A. Cogdill, the Pilgrim's Pride Pension Committee, Robert A. Wright, Jane Brookshire, Renee N. DeBar, the Pilgrim's Pride Administrative Committee, Gerry Evenwel, Stacey Evans, Evelyn Boyden, and "John Does 1-10." The Amended Complaint purports to assert claims on behalf of persons who were participants in or beneficiaries of the RSP or the To-Ricos Plan at any time between January 29, 2008, through December 1, 2008 ("the alleged class period"), and whose accounts included investments in the Company's common stock. Like the original Patterson and Smalls complaints, the Amended Complaint alleges that the defendants breached ERISA fiduciary duties to participants and beneficiaries of the RSP and To-Ricos Plan by permitting both Plans to continue investing in the Company's common stock during the alleged class period. The Amended Complaint also alleges that certain defendants were "appointing" fiduciaries who failed to monitor the performance of the defendant-fiduciaries they appointed. Further, the Amended Complaint alleges that all defendants are liable as co-fiduciaries for one another's alleged breaches. Plaintiffs seek actual damages in the amount of any losses the RSP and To-Ricos Plan attributable to the decline in the value of the common stock held by the Plans, to be allocated among the participants' individual accounts as benefits due in proportion to the accounts' alleged diminution in value, costs and attorneys' fees, an order for equitable restitution and the imposition of constructive trust, and a declaration that each of the defendants have breached their ERISA fiduciary duties to the RSP and To-Ricos Plan's participants. The defendants filed a motion to dismiss the Amended Complaint on May 3, 2010. The plaintiffs responded to that motion on July 2, 2010, dropping plaintiff Smalls from the case and adding an additional plaintiff, Stanley Sylvestros. On December 20, 2011, the case was reassigned to Judge Rodney Gilstrap, and on January 25, 2012, Judge Gilstrap referred the proceedings to Magistrate Roy S. Payne. The court has not yet ruled on the motion to dismiss. The case was subsequently reassigned to District Judge Folsom, but remained assigned to Magistrate Payne for pretrial proceedings. On August 9, 2012, the Magistrate issued a Report and Recommendation denying the motion to dismiss without ruling on the merits. The Report and Recommendation was subsequently adopted by the District Court. The Magistrate scheduled briefing on class certification, which has been completed, and a hearing is scheduled for February 28, 2013. Defendants oppose class certification. About Pilgrim's Pride Pilgrim's Pride Corporation -- http://www.pilgrimspride.com/-- is one of the largest chicken companies in the United States, Mexico and Puerto Rico. The Company's fresh chicken retail line is sold throughout the U.S., throughout Puerto Rico, and in the northern and central regions of Mexico. The Company exports commodity chicken products to 90 countries. The Company operates feed mills, hatcheries, processing plants and distribution centers in 15 U.S. states, Puerto Rico and Mexico. SARPES BEVERAGES: Faces Class Action Over "Dream Water" ------------------------------------------------------- Courthouse News Service reports that Sarpes Beverages dba Dream Products' "Dream Water" is not "all natural" as advertised, a class action claims in Federal Court. SB NEW YORK: Faces Wage Suit Filed by Newspaper Distributors ------------------------------------------------------------ Willie Johnson, Individually and on Behalf of All Other Persons Similarly Situated v. SB New York Inc., Marcus Quintanilla, Mary Ann Licata, Joseph Lauletta, and John Does #1-10, Case No. 151654/2013 (N.Y. Sup. Ct., February 22, 2013) alleges that the Defendants violated the New York Labor law by failing to reimburse newspaper distributor employees for their work related vehicle expenses. He and similar employees, who worked as newspaper distributor employees for the Defendants, contracted with the Defendants to be paid an hourly pay rate, and to be reimbursed for the use of their vehicles at the maximum per mile rate allowed by the Internal Revenue Service, but the Defendants never reimbursed these employees for the use of their vehicles and, therefore, they were not paid their full wages, Mr. Johnson contends. Mr. Johnson is a resident of Queens County, New York. SB New York Inc. is a New York corporation and operates a newspaper distribution center. The Individual Defendants are owners, officers, directors or managing agents of the Company, who participated in the day-to-day operations of the Company. The Doe Defendants represent the officers, directors and managing agents of the Company, whose identities are unknown at this time. The Plaintiff is represented by: William C. Rand, Esq. LAW OFFICE OF WILLIAM COUDERT RAND 488 Madison Avenue, Suite 1100 New York, NY 10022 Telephone: (212) 286-1425 E-mail: wcrand@wcrand.com SPI ELECTRICITY: Class Action Participants Can Watch Trial Live --------------------------------------------------------------- Megan Bailey, writing for Diamond Valley Leader, reports that people involved with the Black Saturday class action will be able to stream live vision of the trial. Access will be granted via a password and will allow 10,000 people access to the trial if they are unable to attend. Maurice Blackburn Lawyers senior associate Rory Walsh said Justice Jack Forrest granted video access to the bushfire survivors despite the defendants opposing the broadcast of evidence. "Open justice is a fundamental principle of common law," he said. "This is a practical means of achieving that whilst still retaining the integrity of the trial and its evidence. "While it is a novel approach to allow the entirety of a trial to be broadcasted to group members directly, where the fire affected community is located a considerable distance from the court room we think this is a sensible and practical solution to the needs of our clients." UNITED STATES: Filipino Veterans' Class Suit Dismissed ------------------------------------------------------ District Judge Saundra Brown Armstrong on February 19, 2013, entered judgment in favor of the defendants in DE FERNANDEZ v. UNITED STATES DEPARTMENT OF VETERANS AFFAIRS. Filipino World War II veterans Romeo R. de Fernandez, Ciriaco C. Dela Cruz and Valeriano C. Marcelino, and the Veterans Equity Center, a non-profit entity which services the Filipino WWII veteran community, filed the putative class action against the United States Department of Veteran Affairs and various VA officials in their official capacity to challenge the denial of benefits under the Filipino Veterans Equity Compensation Fund. The parties are presently before the Court on the Defendants' Second Revised Motion to Dismiss Plaintiffs' Complaint. Judge Armstrong dismissed the class action for lack of subject matter jurisdiction, and directed the clerk of court to close the file and terminate any pending matters. The case before Judge Armstrong is styled ROMEO R. DE FERNANDEZ, CIRIACO C. DELA CRUZ, VALERIANO C. MARCELINO, VETERANS EQUITY CENTER, a non-profit organization on behalf of themselves and others similarly situated, Plaintiffs, v. UNITED STATES DEPARTMENT OF VETERANS AFFAIRS; ERIK K. SHINSEKI, Secretary of Veterans Affairs; MICHAEL WALCOFF, Acting Under Secretary, Veterans Benefits Administration; BRADLEY G. MAYES, Director, Compensation and Pension Service; DAVID WEST, Veteran Service Center Manager, Oakland Regional Office of Veterans Benefits Administration; Defendants, Case No. C 10-02468 SBA, (N.D. Cal.) A copy of the District Court's February 19, 2013 Order is available at http://is.gd/kj2hhNfrom Leagle.com. USG CORP: Accrues $8-MM to Resolve Knauf Tianjin Wallboard Suit --------------------------------------------------------------- USG Corporation disclosed in its February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012, that it has an accrual of $8 million for its estimated cost of resolving all the Chinese wallboard property damage claims pending against its subsidiary. The Company's subsidiary, L&W Supply Corporation, is one of many defendants in lawsuits relating to Chinese-made wallboard installed in homes primarily in the southeastern United States during 2006 and 2007. The wallboard was made in China by a number of manufacturers, including Knauf Plasterboard (Tianjin) Co., or Knauf Tianjin, and was sold or used by hundreds of distributors, contractors, and homebuilders. Knauf Tianjin is an affiliate or indirect subsidiary of Knauf Gips KG, a multinational manufacturer of building materials headquartered in Germany. Affiliates of Knauf are the beneficial owners of approximately 14% of USG's outstanding shares of common stock. The plaintiffs in these lawsuits, most of whom are homeowners, claim that the Chinese-made wallboard emits elevated levels of sulfur gases causing a bad smell and corrosion of copper or other metal surfaces. Plaintiffs also allege that the Chinese-made wallboard causes health problems such as respiratory problems and allergic reactions. The plaintiffs seek damages for repair of their property and for alleged bodily injury. Most of the lawsuits against L&W Supply are part of the consolidated multi-district litigation titled In re Chinese-Manufactured Drywall Products Liability Litigation, MDL No. 2047, pending in New Orleans, Louisiana. The focus of the litigation has been on plaintiffs' property damage claims and not their alleged bodily injury claims. Of the claims made to date, the Company has identified approximately 290 homes where the Company has confirmed that L&W Supply delivered, or could have delivered, Knauf Tianjin wallboard to the home. The Company has resolved the claims relating to approximately 270 of those homes. The Company has an agreement with Knauf that effectively caps the Company's responsibility for property damage claims relating to Knauf Tianjin wallboard at a fixed amount per square foot for the property at issue. The Company also entered into a homeowner class settlement resolving claims of all homeowners who filed lawsuits alleging damages from Knauf Tianjin wallboard. The class settlement, which has been approved by the court and is now effective, resolves both property damage and bodily injury claims, for the same fixed amount per square foot set forth in the Company's agreement with Knauf. For all claims against the Company relating to Knauf Tianjin wallboard that are not resolved by the class settlement, including claims of homeowners who do not participate in the class settlement, the Company's settlement with Knauf caps its responsibility for Knauf Tianjin property damage claims. Although the vast majority of Chinese drywall claims against the Company relates to Knauf Tianjin board, a small percentage of claims made against L&W Supply Corporation relates to Chinese-made wallboard that was not manufactured by Knauf, but which is alleged to have odor and corrosion problems. Those claims are not encompassed within the Company's settlement with Knauf or the recent homeowner class settlement. As of December 31, 2012, the Company has an accrual of $8 million for its estimated cost of resolving all the Chinese wallboard property damage claims pending against L&W Supply and estimated to be asserted in the future, and, based on the terms of the Company's settlement with Knauf, the Company has recorded a related receivable of $3 million. The Company's accrual does not take into account litigation costs, which are expensed as incurred, or any set-off for potential insurance recoveries. The Company's estimated liability is based on the information available to the Company regarding the number and type of pending claims, estimates of likely future claims, and the estimated costs of resolving those claims. The Company's estimated liability could be higher if the number or the cost of resolving Chinese wallboard claims other than Knauf Tianjin claims significantly exceeds the Company's estimates. Considering all factors known to date, the Company believes that these claims and other similar claims that might be asserted will not have a material effect on its results of operations, financial position or cash flows. USG CORP: Faces Class Suits Over Pricing of Gypsum Wallboards ------------------------------------------------------------- USG Corporation is facing class action lawsuits related to pricing of gypsum wallboards, according to the Company's February 15, 2013, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended December 31, 2012. Beginning December 2012, USG Corporation and United States Gypsum Company were named as defendants in putative class action lawsuits alleging that since at least September 2011, U.S. wallboard manufacturers conspired to fix and raise the price of gypsum wallboard sold in the United States. The lawsuits also name as defendants all seven of the other U.S. wallboard manufacturers. The lawsuits, which are identical except for the named plaintiff, were filed in federal district court for the Eastern District of Pennsylvania. The lawsuits claim that the alleged conspiracy began with some manufacturers informing their customers in the fall 2011 that wallboard prices would be increased effective January 2012 and that job quotes would be eliminated. Each plaintiff purports to bring its claims on behalf of a class of entities that purchased gypsum wallboard in the United States directly from any of the defendants or their affiliates from January 1, 2012, to the present. On behalf of the alleged class, the plaintiffs seek unspecified monetary damages, tripled under the antitrust laws, as well as pre-judgment interest, post- judgment interest and attorneys' fees. Additional similar lawsuits were filed in federal district court for the Northern District of Illinois and in federal district court for the Western District of North Carolina. In addition to these lawsuits, other similar lawsuits were filed claiming that the alleged conspiracy began in 2008 and seeking to certify a class of direct purchasers who bought gypsum wallboard from January 1, 2008, to the present. These lawsuits were filed in the federal district court for the Western District of North Carolina. Some of these wallboard pricing lawsuits also name L&W Supply Corporation as a defendant. In addition, similar lawsuits were filed on behalf of indirect purchasers of gypsum wallboard, i.e., those who purchased the wallboard for end use and not for resale, at any time from January 1, 2012, to the present. These lawsuits were filed in the federal district court for the Eastern District of Pennsylvania. All of these wallboard pricing class action lawsuits were only recently filed and are not specific in the amount of damages claimed. However, based on the information known to it, the Company believes these lawsuits will not have a material effect on its results of operations, financial position, or cash flows. * Class Actions Put Manufacturers at Risk of Financial Losses ------------------------------------------------------------- IndustryWeek reports that under federal and state law, it is possible to address multiple complaints about the safety and efficacy of a product in a single class action lawsuit. When courts determine that plaintiffs' claims are sufficiently similar to move ahead in a single class action proceeding, the result can expose manufacturers to enormous financial risk. However, a recent Supreme Court case exposes new ways to prevent plaintiffs from rolling their cases into a single, high-cost suit, and gives manufacturers new tools to fight these motions at the earliest stage of trial. Requirements for a Class Action Lawsuit For a court to certify a class action lawsuit, federal rules require the plaintiff to show that questions of law or fact common to the claims of all class members predominate over questions affecting individual claims. Identifying key similarities among all plaintiffs is often critical to whether a court permits a case to proceed as a class action. Historically, manufacturers of building products have been exposed to class actions. Courts have often glossed over individual differences in the application of building manufacturers' products, deeming them similar simply because they were incorporated into structures and not used on their own. Broad class actions alleging universal product failure, or alleging actual or potential adverse health effects stemming from building products are frequently filed, and some have been permitted to proceed, often overlooking material differences from application to application. The Supreme Court's recent ruling in Wal-Mart Stores, Inc. v. Dukes clarifies the law in a way that will make it harder for plaintiffs to engineer broad class action lawsuits. While the details of the ruling are complex, as a practical matter, defendants are now better equipped to prevent class certification if they can show that non-common issues affect the claims of individual plaintiffs. In practice, to prevent a class action manufactures must find new ways to harvest evidence differentiating one claim from another, and identify narrow patterns among reported defects. An improved customer service function that is focused on mining for this critical data should serve as the front line in combating class action lawsuits. Building a Trail of Differentiating Evidence Building products manufacturers have a unique opportunity to develop a trail of differentiating evidence through the prolonged and back-and-forth relationship between manufacturers and the end users of their products. Consumers of building products -- ranging from "do-it-yourselfers" to those relying on contractors or installers -- make use of the products in widely different settings and over long periods of time. When problems arise, there are multiple opportunities for contact and communication between the customer, the installer, and the manufacturer. Improving and encouraging consumers to connect with customer support around reported issues provides a fertile opportunity for feedback on the performance of their products under different conditions. Tracking and analyzing patterns in this feedback can also suggest new information about a product -- for example, that a product's function is affected by certain environmental or other factors in a specific way, including the installation process or specific facts about the individual's dwelling. Likewise, developing a robust process for responding to consumer complaints (including investigation of individual homeowners' circumstances and remedying legitimate complaints) can generate an individualized body of evidence. To the extent that this process generates an increasingly- differentiated data set of product-use outcomes based on differing circumstances, and communications between and among manufacturers, installers, and homeowners, it has great potential to generate the kind of evidence that should prevent class certification under the Dukes ruling. Five Take-Away Points * Develop a robust customer support network and ensure staff diligently document different circumstances (such as weather, installation techniques, location, etc.) that may affect a product's behavior. * Search for patterns. Is temperature affecting product behavior? Location? Installation technique? * Leverage relationships with customers to gather additional support for patterns of differential product behavior. * Always explore the potential individualized reasons for a claimed defect or damage. Even evidence developed in a small, individual lawsuit may be useful in preventing a future class action. * Include legal counsel when developing a customer support protocol to insure sufficient data is being mined; loop in counsel as early as possible if patterns emerge around reported defects or damage. ********* S U B S C R I P T I O N I N F O R M A T I O N Class Action Reporter is a daily newsletter, co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Noemi Irene A. Adala, Joy A. Agravante, Valerie Udtuhan, Julie Anne L. Toledo, Christopher Patalinghug, Frauline Abangan and Peter A. Chapman, Editors. Copyright 2013. All rights reserved. ISSN 1525-2272. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The CAR subscription rate is $775 for six months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. * * * End of Transmission * * *