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             C L A S S   A C T I O N   R E P O R T E R

               Friday, April 30, 1999, Vol. 1, No. 61

                            Headlines

ALABAMA POWER: Appeals Partial Judgment in Service Contract Case
BON TON STORES: Facing Accusations in Nine West Antitrust Case
CENDANT CORPORATION: Federal Court Dismisses New Jersey Suit
EVOLVING SYSTEMS: Pays $2.5 Million for Shareholder Settlement
FOAMEX INTERNATIONAL: Stull Stull Files Complaint in New York

FOAMEX INTERNATIONAL: Trace Holdings' Offer Prompts Six Suits
GYMBOREE CORP: Saipan Sourcing Prompts State and Federal Suits
HCB BANCSHARES: Abbey Gardy Files Complaint in Texas
IMC GLOBAL: Sterlington Settles, Potash Pending, More Updates
IRIDIUM WORLD: Cohen Milstein Files District of Columbia Suit

IRIDIUM WORLD: Finkelstein Thompson Files Complaint in DC
IRIDIUM WORLD: Milberg Weiss Files District of Columbia Suit
IRIDIUM WORLD: Schiffrin & Barroway File Complaint in DC
KRAUSES FURNITURE: Seeking Dismissal of Mr. Coffee Brouhaha
MATAV-CABLE: Subscribers Say Israeli Cable TV Costs Too Much

MEDICAL RESOURCES: Settlement Pending in Consolidated Litigation
PETSMART INC: Class Complaints Dog Retail Operations
SPORTS AUTHORITY: Complaint Over Venator Merger Hangs On
SUN HEALTHCARE: Cohen Milstein Files Complaint in New Mexico


                            *********


ALABAMA POWER: Appeals Partial Judgment in Service Contract Case
----------------------------------------------------------------
In 1996, a class action against Alabama Power was filed charging
Alabama Power with fraud and non-compliance with regulatory
statutes relating to the offer, sale, and financing of "extended
service contracts" in connection with the sale of electric
appliances. The plaintiffs seek damages in an unspecified
amount. Alabama Power has offered extended service agreements to
its customers since January 1984, and approximately 175,000
extended service agreements could be involved in these
proceedings. The trial court has granted partial summary
judgment in favor of the plaintiffs. Alabama Power has appealed
this decision to the Supreme Court of Alabama. The final outcome
of this case cannot now be determined.


BON TON STORES: Facing Accusations in Nine West Antitrust Case
--------------------------------------------------------------
Bon Ton Stores Inc. has been named, together with other
department stores and Nine West Group, Inc., a defendant in a
number of antitrust class action lawsuits filed in February
1999, which have been consolidated in the United States District
Court for the Southern District of New York. These lawsuits
allege that the defendants engaged in conduct in violation of
the antitrust laws relating to the sale of shoes manufactured by
Nine West, and seek unspecified damages against all defendants.

The Company and its counsel believe these claims are without
merit and intends to vigorously defend these lawsuits.


CENDANT CORPORATION: Federal Court Dismisses New Jersey Suit
------------------------------------------------------------
The United States District Court for New Jersey in Newark
dismissed a securities class action brought against Cendant
Corporation (NYSE: CD) on behalf of purchasers of American
Bankers Insurance Group (ABIG) common stock for losses relating
to the proposed acquisition of ABIG by Cendant. The court found
that the class action failed to state a claim upon which relief
could be granted. In October 1998, Cendant and ABIG announced
their mutual decision to terminate their merger agreement.

Cendant Corporation is a global provider of consumer and
business services. Headquartered in New York, NY, the Company
has more than 35,000 employees and operates in over 100
countries.


EVOLVING SYSTEMS: Pays $2.5 Million for Shareholder Settlement
--------------------------------------------------------------
>From Denver, Colorado, Evolving Systems (Nasdaq: EVOL) reported
favorable first quarter 1999 results. However, negatively
affecting the company's net income was the recently announced
shareholder class action lawsuit settlement.

As part of the settlement, the Company paid $2,500,000 out of
the Company's cash balances in April, 1999. The impact on the
quarterly earnings, including accrued legal expenses, is a $.27
increase in the loss per share to $.37 per share. The settlement
is pending approval by the court.

Evolving Systems, Inc. provides the telecommunications industry
with software products and systems integration for business and
operational support systems and network element software.


FOAMEX INTERNATIONAL: Stull Stull Files Complaint in New York
-------------------------------------------------------------
A class action lawsuit was filed by Stull, Stull & Brody on
April 26, 1999, in the United States District Court for the
Southern District of New York on behalf of all persons who
purchased the common stock of Foamex International, Inc.
(NASDAQ: FMXIE) (NASDAQ: FMXI) between May 7, 1998, and April
16, 1999.

The complaint alleges that certain officers and directors of the
Company violated Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934 by, among other things, misrepresenting and
omitting material information concerning Foamex's financial
condition and results of operations. These statements caused
Foamex's common stock price to be artificially inflated.

Additional details may be obtained from Tzivia Brody, Esq. at
800-337-4983 or at SSBNY@aol.com via email.


FOAMEX INTERNATIONAL: Trace Holdings' Offer Prompts Six Suits
-------------------------------------------------------------
On or about March 17, 1998, five purported class action lawsuits
were filed in the Delaware Chancery Court, New Castle County,
against Foamex International Inc., directors of the Company,
Trace Holdings, and individual officers and directors of Trace
Holdings:

   -Brickell Partners v. Marshall S. Cogan, et al., No. 16260NC;

   -Mimona Capital v. Salvatore J. Bonanno, et al., No. 16259NC;

   -Daniel Cohen v. Foamex International Inc., No. 16263;

   -Eileen Karisinki v. Foamex International Inc., et al., No.
    16261NC

   -John E. Funky Trust v. Salvatore J. Bonanno, et al., No.
    16267.

A sixth purported class action lawsuit, Barnett Stepak v. Foamex
International Inc., et al., No. 16277, was filed on or about
March 23, 1998 against the same defendants.

The complaints in the six actions allege, among other things,
that the defendants have violated fiduciary and other common law
duties purportedly owned to the Company's stockholders in
connection with the Trace Holdings proposal to acquire all of
the shares of the Company's common stock. The complaints seek,
among other things, class certification, a declaration that the
defendants have breached their fiduciary duties to the class,
preliminary and permanent injunctions baring implementation of
the proposed transaction, rescission of the transaction if
consummated, unspecified compensatory damages, and costs and
attorneys' fees.


GYMBOREE CORP: Saipan Sourcing Prompts State and Federal Suits
--------------------------------------------------------------
Gymboree has been named as a defendant in two lawsuits relating
to sourcing of products from Saipan (Commonwealth of Northern
Mariana Islands).

A complaint was filed on January 13, 1999 in California Superior
Court in San Francisco by the Union of Needletrades Industrial
and Textile Employees, AFL-CIO; Global Exchange; Sweatshop
Watch; and Asian Law Caucus against Gymboree and 17 other
parties. The plaintiffs allege violations of California's
unlawful, fraudulent and unfair business practices and untrue
and misleading advertising statutes in connection with labeling
of product and labor practices regarding workers of factories
that make product for Gymboree in Saipan. The plaintiffs seek
injunctive relief, restitution, disgorgement of profits and
other damages. On March 29, 1999, Gymboree, along with other
defendants, filed a demurrer in California Superior Court in San
Francisco, seeking dismissal of the complaint.

A second complaint was filed on January 13, 1999 in Federal
District Court, Central District of California, by various
unidentified worker plaintiffs against Gymboree and 25 other
parties. Those unidentified worker plaintiffs seek class-action
status and allege, among other things, that Gymboree (and other
defendants) violated the Racketeer Influenced and Corrupt
Organizations Act in connection with the labor practices and
treatment of workers of factories in Saipan that make product
for us. The plaintiffs seek injunctive relief as well as actual
and punitive damages. On March 29, 1999, Gymboree, along with
several other defendants, filed a motion in Federal District
Court, Central District of California, to transfer the venue of
the case to the Commonwealth of the Northern Mariana Islands.
Additionally, on April 12, 1999, Gymboree, along with several
other defendants, filed a motion to dismiss the federal
complaint.


HCB BANCSHARES: Abbey Gardy Files Complaint in Texas
----------------------------------------------------
A class action lawsuit was filed by Abbey, Gardy & Squitieri,
LLP on April 22, 1998, in the United States District Court for
the Eastern District of Texas, on behalf of all persons who
purchased or otherwise acquired securities of HCB Bancshares,
Inc. between September 28, 1997, and February 2, 1999.

The Complaint charges HCB and certain officers and directors of
the Company with violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, by, among other things, issuing
to the investing public false and misleading financial
statements and press releases concerning HCB's earnings. Because
of the issuance of a series of false and misleading financial
statements and press release concerning HCB's financial results,
the price of HCB securities were artificially inflated.

For additional information, call Judith L. Spanier or Nancy
Kaboolian at 800-889-3701 or 212-889-3700, or write to
nkaboolian@a-g-s.com via email.


IMC GLOBAL: Sterlington Settles, Potash Pending, More Updates
-------------------------------------------------------------
In early 1998, IMC GLobal Inc. entered into a Preliminary
Settlement Agreement with the plaintiffs in connection with the
Louisiana class action arising out of a May 1991 explosion at a
nitroparaffins plant located in Sterlington, Louisiana. The
Preliminary Settlement Agreement settles all claims that members
of the class have against the Company and releases the Company
from further potential liabilities based on the claims of the
members of the class. In January 1999, the court held a hearing
on the fairness of the Preliminary Settlement Agreement. In
February 1999, the court entered a written order approving the
Settlement Agreement.

The Company also has settled all the known claims of individuals
and entities who opted out of the Louisiana class action.
Settlement of the Louisiana third-party claims is intended to
resolve the Company's known potential future liabilities in
connection with the Sterlington explosion. In addition, the
settlement is intended to protect the Company from the remaining
claims for contribution and indemnity filed by ANGUS Chemical
Company and the other remaining defendants with respect to the
Sterlington explosion.

In another case, IMC GLobal Inc. was a defendant, along with
other Canadian and United States potash producers, in a class
action antitrust lawsuit filed in federal court in 1993. The
plaintiffs alleged a price-fixing conspiracy among North
American potash producers beginning in 1987 and continuing until
the filing of the complaint. The class action complaint against
all defendants, including the Company, was dismissed by summary
judgment in January 1997. The summary judgment dismissing the
case is currently on appeal by the plaintiffs to the United
States Court of Appeals for the Eighth Circuit (Court of
Appeals). The Court of Appeals is expected to rule during
calendar 1999.

In addition, in 1993 and 1994, class action antitrust lawsuits
with allegations similar to those made in the federal case were
filed against IMC GLobal Inc. and other Canadian and United
States potash producers in state courts in Illinois and
California. The Illinois case was dismissed for failure to state
a claim. In the California litigation, all proceedings have been
stayed pending the decision of the Court of Appeals.

In another matter, in August 1997, five identical class action
lawsuits were filed in Chancery Court in Delaware by unitholders
of PLP. Each case named the same defendants and broadly alleged
that FTX and FMRP Inc. (FMRP) had breached fiduciary duties owed
to the public unitholders of PLP. The Company was alleged to
have aided and abetted these breaches of fiduciary duty.

In November 1997, an amended class action complaint was filed
with respect to all cases. The amended complaint named the same
defendants and raised the same broad allegations of breaches of
fiduciary duty against FTX and FMRP for allegedly favoring the
interests of FTX and FTX's common stockholders in connection
with the FTX Merger. The plaintiffs claimed specifically that,
by virtue of the FTX Merger, the public unitholders' interests
in PLP's ownership of IMC-Agrico would become even more subject
to the dominant interest of IMC GLobal Inc. The amended
complaint seeks certification as a class action and an
injunction against the proposed FTX Merger or, in the
alternative, rescissionary damages. The defendants' moved the
court to dismiss the amended complaint in November 1998. IMC
intends to defend this action vigorously.

In May 1998, IMC and PLP (collectively, Plaintiffs) filed a
lawsuit (IMC Action) in Delaware Chancery Court against certain
former directors of FTX (Director Defendants), and MOXY. IMC
alleges that the Director Defendants, as the directors of PLP's
administrative managing general partner FTX, owed duties of
loyalty to PLP and its limited partnership unitholders. IMC
further alleges that the Director Defendants breached their
duties by causing PLP to enter into a series of interrelated
non-arm's-length transactions with MOXY, an affiliate of FTX.

IMC also alleges that MOXY knowingly aided and abetted and
conspired with the Director Defendants to breach their fiduciary
duties. On behalf of the PLP public unitholders, IMC seeks to
reform or rescind the contracts that PLP entered into with MOXY
and to recoup the monies expended as a result of PLP's
participation in those agreements. The Director Defendants and
MOXY have filed motions to dismiss the Plaintiffs' claims. The
defendants filed their briefs in support of their motions in
January 1999. IMC filed its amended complaint, and its responses
to the motions to dismiss in February 1999. No trial date has
been scheduled. IMC intends to pursue this action vigorously.

In May 1998, Jacob Gottlieb filed an action (Gottlieb Action) on
behalf of himself and all other PLP unitholders against the
Director Defendants, MOXY and IMC asserting the same claims that
IMC asserts in the IMC Action. Because IMC and PLP had already
asserted these claims, IMC has filed a motion to dismiss the
Gottlieb Action. The court has not set a briefing schedule for
IMC's motion to dismiss. IMC intends to defend this action
vigorously.


IRIDIUM WORLD: Cohen Milstein Files District of Columbia Suit
-------------------------------------------------------------
The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. on
April 26, 1999, filed a lawsuit in the United States District
Court for the District of Columbia, on behalf of purchasers of
Iridium World Communications, Inc. (Nasdaq: IRID) common stock
during the period between September 9, 1998 and March 29, 1999.

The Complaint alleges that defendants violated Section 10(b) and
20(a) of the Securities Exchange Act of 1934 by misrepresenting
or failing to disclose material information concerning the
Company's ability to fully launch the Iridium System, a global
mobile wireless communications system. On March 29, 1999, the
Company revealed that the Company would not be able to meet its
necessary subscriber numbers and, therefore, would not be in
compliance with certain bank loans. As a result of defendants'
false and misleading statements and omissions, the price of
Iridium's stock was artificially inflated.

To learn more, call Andrew N. Friedman at 888-240-0775 or 202-
408-4600 or write afriedman@cmht.com via email.


IRIDIUM WORLD: Finkelstein Thompson Files Complaint in DC
---------------------------------------------------------
On April 22, 1999, Finkelstein, Thompson & Loughran filed a
class action lawsuit in the United States District Court for the
District of Columbia on behalf of investors who purchased
Iridium World Communications, Ltd. (Nasdaq: IRID) stock between
September 9, 1998 and March 29, 1999. The lawsuit charges
Iridium, Motorola, Inc. and certain officers and directors of
Iridium with violations of the federal securities laws and
regulations of the United States.

The Complaint alleges that defendants issued false and
misleading statements and failed to disclose material facts
concerning the Company's ability to fully launch the Iridium
System. Specifically, defendants: falsely reported achievable
subscriber numbers and revenue figures; failed to disclose the
serious technical problems with the Iridium System;
misrepresented that the Iridium System was up and "commercially
available" on November 1, 1998 when it was not; failed to
disclose delays in handset production which were required to
operate the Iridium System; and failed to disclose that the
Company had entered into covenants with lenders the requirements
of which the Company would not and could not satisfy.

The Company's fraudulent practices were disclosed on March 29,
1999 when, for the first time, the Company disclosed that it
would not meet its necessary subscriber numbers and that as a
direct consequence would not be able to satisfy its Secured
Credit Facility covenants. Accordingly, the Company's common
stock dropped approximately 73% since its May 1998 high.

To learn more, call Donald J. Enright with Finkelstein, Thompson
& Loughran at 888-333-4409 or 202-337-8000 or at DJE@FTLLAW.com
by email, or Fred Isquith with Wolf Haldenstein at 800-575-0735.



IRIDIUM WORLD: Milberg Weiss Files District of Columbia Suit
------------------------------------------------------------
A class action lawsuit was filed by the law firm of Milberg
Weiss on April 26, 1999, in the United States District Court for
the District of Columbia on behalf of all persons who purchased
or otherwise acquired the common stock of Iridium World
Communications, Inc. (Nasdaq: IRID) between September 9, 1998
and March 29, 1999.

The complaint charges Iridium, certain officers of Iridium and
Motorola, Inc. with violations of Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 as well as Rule 10b-5. The
complaint alleges that defendants issued a series of materially
false and misleading statements concerning the Company's ability
to fully launch the Iridium System. Specifically, defendants
falsely reported achievable subscriber numbers and projected
revenue figures, failed to disclose the serious technical
problems with the Iridium System, failed to disclose delays and
shortages in necessary handset production, and that, absent
achieving the requisite number of subscribers and revenue
figures, the Company would violate certain covenants between
itself and its lenders.

For more information, contact Steven G. Schulman, Samuel H.
Rudman or Michael Swick by calling 800-320-5081 or write to
endfraud@mwbhlny.com by email.


IRIDIUM WORLD: Schiffrin & Barroway File Complaint in DC
--------------------------------------------------------
The law firm of Schiffrin & Barroway, LLP filed a class action
lawsuit in the United States District Court for the District of
Columbia on behalf of all purchasers of the common stock of
Iridium World Communications, Inc. (Nasdaq: IRID) from September
9, 1998 through March 29, 1999. The complaint charges Iridium
and certain of its officers and directors with issuing false and
misleading statements concerning the Company's financial
condition and failing to disclose material facts concerning the
Company's ability to fully launch the Iridium System.

For more information, call Andrew L. Barroway, Esq. at 888-299-
7706 or 610-667-7706, or write info@scbclasslaw.com via email.


KRAUSES FURNITURE: Seeking Dismissal of Mr. Coffee Brouhaha
-----------------------------------------------------------
On May 27, 1994, Krauses Furniture Inc. was served with a
complaint in the case captioned Miriam Brown v. Mr. Coffee, inc.
et al. (Civil Action No. 13531), in the Delaware Court of
Chancery, New Castle County. The complaint names the Company,
Mr. Coffee and certain individuals including Jean R. Perrette
and Kenneth W. Keegan, both former directors and officers of the
Company, as defendants in a purported class action lawsuit.

The complaint alleges that the individuals named as co-
defendants breached their fiduciary duties as directors of Mr.
Coffee by, among other things, their alleged efforts to entrench
themselves in office and prevent Mr. Coffee's public
shareholders from maximizing the value of their holdings,
engaging in plans and schemes unlawfully to thwart offers and
proposals from third parties, and approving or causing the
Company and others to agree to vote in favor of a merger with
Health o meter Products, Inc. The Company is alleged to have
participated in and advanced the alleged breaches.

The plaintiff originally sought to enjoin the merger; however,
plaintiff withdrew such action and the merger was completed in
August 1994. The Company and the Mr. Coffee directors filed
motions to dismiss the complaint on August 11, 1994. On October
9, 1996, the plaintiff filed a second amended complaint. All
defendants subsequently joined in filing a motion to dismiss the
complaint. The Court has taken the motion under advisement.

The plaintiff seeks compensatory damages and costs and
disbursements in connection with the action, including
attorneys' and experts' fees, and such other further relief as
the court deems just and proper.

For a number of reasons, including the extensive solicitation
and negotiation process which preceded the acceptance by Mr.
Coffee's Board of Directors of the Health o meter offer, the
Company believes that the plaintiff's allegations are without
merit.


MATAV-CABLE: Subscribers Say Israeli Cable TV Costs Too Much
------------------------------------------------------------
In a story from Netanya, Israel, Matav-Cable Systems Media Ltd.
(NASDAQ: MATVY) announced that on April 22, 1999, the Company
received notice of a class action lawsuit filed against it in
accordance with paragraph 46 of Israel's Restrictive Practices
Law. The plaintiff requests that his lawsuit be recognized as a
class action suit for the Company's Cable TV subscribers, asked
that that the Company be ordered to reduce its current
subscription rate, and to pay damages to its subscribers related
to subscription fees paid between October 5, 1996 and April 1,
1999. The named plaintiff claims that his personal damage is
1,279 NIS.

In addition, the complainant requests the court to declare that
the Company's level of service has been insufficient, and that
the Minister of Communications should make no judgment as to an
extension of the Company's cable franchise. The Company must
file a response within 20 days.

The Company opposes the complaint and believes that its
allegations are without basis. The Company stresses that its
subscription fees have always been and are currently established
under the supervision and approval of public authorities
including the Ministry of Communications.

Matav is a leading operator and provider of broadband Cable TV
services in Israel. As one of the CATV operators in Israel, the
Company operates in exclusive franchise areas which cover
approximately 25% of Israel's households. The Company provides
CATV services to about 25% of all CATV subscribers in Israel.

To learn more, call Jody Burfening at 212-838-3777 ext. 106 or
write to jody@lhai.com via email, or call Alma Weiss of Matav-
Cable Systems Media Ltd. at 972 54566090.


MEDICAL RESOURCES: Settlement Pending in Consolidated Litigation
----------------------------------------------------------------
Between November 14, 1997 and January 9, 1998, seven class
action lawsuits were filed in the United States District Court
for the District of New Jersey against Medical Resources Inc.,
and certain of the Company's directors and officers.

On November 14, 1997, Joan D. Ferrari, who claims to be a
Company stockholder, filed a lawsuit on behalf of all persons
who purchased Common Stock during the period between May 15,
1997 and November 7, 1997. The Ferrari complaint names as
defendants the Company and Gary N. Siegler, Stephen M. Davis,
Gary L. Fuhrman, John H. Josephson and Neil H. Koffler. On
November 18, 1997, Tri-Masonry Company, who claims to be a
Company stockholder, filed a complaint on behalf of all persons
who purchased Common Stock during the period between March 19,
1997 and November 10, 1997. On November 19, 1997, Yaakov Prager,
who claims to be a Company stockholder, filed a complaint on
behalf of all persons who purchased Common Stock during the
period between May 16, 1997 and November 10, 1997. The Tri-
Masonry and Prager complaints name as defendants the Company,
William D. Farrell, John P. O'Malley and Gary N. Siegler. On
November 20, 1997, Albert Schonert, who claims to be a Company
stockholder, filed a complaint on behalf of all persons who
purchased Common Stock during the period between May 15, 1997
and November 7, 1997. The Schonert complaint names as defendants
the Company and Gary N. Siegler, Stephen M. Davis, Gary L.
Fuhrman, John H. Josephson, Neil H. Koffler and William D.
Farrell. On December 12, 1997, Anne Benjamin, Scott L. Benjamin,
Maxine Benjamin, Donald Benjamin and Andrew M. Schreiber, who
claim to be Company stockholders, filed a complaint on behalf of
all persons who purchased Common Stock during the period between
March 31, 1997 and November 10, 1997. The Benjamin complaint
names as defendants the Company and Gary N. Siegler, John P.
O'Malley and William D. Farrell. On December 31, 1997, Allen H.
Weingarten, who claims to be a Company stockholder, filed a
complaint on behalf of all persons who purchased Common Stock
during the period between March 19, 1997 and November 10, 1997.
The Weingarten complaint names as defendants the Company and
William D. Farrell, John P. O'Malley and Gary N. Siegler. On
January 9, 1998, Roselle Sachs, who claims to be a Company
stockholder, filed a complaint on behalf of all persons who
purchased Common Stock during the period between May 15, 1997
and November 10, 1997. The Sachs complaint names as defendants
the Company and Gary N. Siegler, Stephen M. Davis, Gary L.
Fuhrman, Neil H. Koffler and William D. Farrell.

The complaints in each action assert that the Company and the
named defendants violated Section 10(b), and that certain named
defendants violated Section 20(a) of the Securities Exchange Act
of 1934, alleging that the Company omitted and/or misrepresented
material information in its public filings, including that the
Company failed to disclose that it had entered into acquisitions
that were not in the best interest of the Company, that it had
paid unreasonable and unearned acquisition and financial
advisory fees to related parties, and that it concealed or
failed to disclose adverse material information about the
Company. The complaints each seek unspecified compensatory
damages, with interest, and the costs and expenses incurred in
bringing the action.

On February 9, 1998, the Honorable Joel Pisano, United States
Magistrate Judge, entered an Order consolidating the above-
mentioned class actions for all purposes. On March 31, 1998, the
lead plaintiffs in the consolidated class actions served their
Consolidated Class Action Complaint, asserting that the Company
and the named defendants violated Section 10(b) of the Exchange
Act, and that certain named defendants violated Sections 20(a)
and 20A of the Exchange Act.

On December 18, 1998, attorneys for the plaintiffs in the
pending class actions reached an agreement in principle with the
Company and certain of the other defendants to settle all of the
pending class actions in consideration primarily of (i) a
payment of $2.75 million to be provided by the Company's insurer
and (ii) the issuance of $5.25 million of convertible
subordinated promissory notes (the "Convertible Subordinated
Notes"). The $5.25 million of Convertible Subordinated Notes
will bear interest at the rate of 8% per annum, will be due on
the earlier of August 1, 2005 or when the Company's presently
outstanding Senior Notes are paid in full, and may be prepaid in
cash by the Company at any time after issuance subject to the
payment of a prepayment premium which begins at 8% and decreases
over time. Additionally, the Convertible Subordinated Notes are
convertible into shares of the Company's Common Stock beginning
February 15, 2000 at a price per share equal to the greater of
$3.00 or 120% of the ten day average closing price of the
Company's Common Stock as of the date of the court hearing to be
scheduled to approve the agreement in principle. The court
hearing to approve the agreement in principle is expected to
occur in May 1999.

The agreement-in-principle and the class action settlement
contemplated thereby are further subject to (1) consent to the
issuance of the convertible subordinated notes by the Company's
Senior Noteholders and (2) the right of either the Company or
the attorneys representing the class plaintiffs to terminate the
agreement-in-principle if the ten day average closing price of
the Company's Common Stock as of the court hearing date is less
than $1.75 per share. There can be no assurance that the
Company's Common Stock will be above the $1.75 per share price
prior to the approval. If such settlement is not approved or
consummated, the Company intends to defend vigorously against
the allegations.

On June 2, 1998, Mr. Ronald Ash filed a complaint against the
Company, StarMed, Wesley Medical Resources, Inc., a subsidiary
of the Company ("Wesley"), and certain officers and directors of
the Company in the United States District Court for the Northern
District of California. On June 24, 1997, the Company, acquired
the assets of Wesley, a medical staffing company in San
Francisco, California, from Mr. Ash and another party for 45,741
shares of the Company's Common Stock valued at $2,000,000 and
contingent consideration based on the company achieving certain
financial objectives during the three year period subsequent to
the transaction. The Ash complaint, among other things, alleges
that the defendants omitted and/or misrepresented material
information in the Company's public filings and that they
concealed or failed to disclose adverse material information
about the Company in connection with the sale of Wesley to the
Company by the plaintiff. The plaintiff seeks damages in the
amount of $4.25 million or, alternatively, rescission of the
sale of Wesley.

On October 7, 1998, upon motion by the Company, the Ash action
was transferred from the United States District Court for the
Northern District of California and consolidated with the
pending securities class actions in the United States District
Court for the District of New Jersey. The Company believes that
it has meritorious defenses to the claims asserted by plaintiff,
and intends to defend itself vigorously.


PETSMART INC: Class Complaints Dog Retail Operations
----------------------------------------------------
On January 6, 1998, PETsMART, Inc. was served with a complaint
entitled Miller v. Parker, et al. (Case No. CV 98-0020 PHX RCS)
in the Federal District Court for the District of Arizona,
Phoenix Division by a putative class of investors in PETsMART,
Inc. securities. The lawsuit alleges, among other things, that
the Company and its officers and directors issued materially
false financial statements about the Company's flea and tick
product inventory, financial condition, sales and use tax
obligations, and results of operations.

Several additional complaints by putative class representatives
alleging substantially the same allegations have been filed in
the District of Arizona. On May 18, 1998, the District Court
entered an order consolidating the securities class action
litigation into a single action entitled In Re PETsMART, Inc.
Securities Litigation, CIV-98-20-PHX-ROS (JBM), and appointing
lead counsel. On July 21, 1998, Plaintiff filed a consolidated
amended complaint in the District Court. On September 25, 1998,
the Company and the individual defendants filed a motion to
dismiss the amended complaint.

The Company believes that the allegations in the amended
complaint are without merit and the Company intends to defend
itself vigorously.

In addition, a former Pet City affiliate has retained counsel in
the United States and made allegations claiming that the Company
misled the shareholders of Pet City at the time of the
acquisition of Pet City concerning PETsMART's business, finances
and prospects. On September 30, 1997, shortly after the receipt
of the allegations by PETsMART, Richard Northcott, the former
Chairman of Pet City, resigned as a director of the Company. No
litigation has been filed with respect to this matter, and the
Company believes that the allegations are without merit.
Nevertheless, there can be no assurance that one or more former
Pet City affiliates will not initiate litigation seeking
monetary damages or an equitable remedy.

On March 28, 1998, a lawsuit was filed in Federal District Court
in the Middle District of Florida entitled Cavucci et al. v.
PETsMART, Inc. (Case No. 98-CV-340). This class-action complaint
alleges unspecified damages based on various alleged violations
of the Fair Labor Standards Act, including alleged failures to
pay overtime premiums. On May 12, 1998, the Company answered the
complaint denying all material allegations. The Court entered an
order of procedure and schedule for trial on July 20, 1998 which
outlines all discovery and trial dates. On November 30, 1998,
PETsMART filed motions for partial summary judgment on
plaintiff's claim that in-store management positions were
misclassified as exempt under the Fair Labor Standards Act. The
Court denied these motions on February 22, 1999. To date, there
have been no settlement discussions, and discovery is ongoing.


SPORTS AUTHORITY: Complaint Over Venator Merger Hangs On
--------------------------------------------------------
On or about May 11 and May 12, 1998, four class action lawsuits
were commenced against Sports Authority Inc. and its Directors
by certain purported Company stockholders in the Court of
Chancery of the State of Delaware in New Castle County. On July
24, 1998, at plaintiffs' request the Court granted an order
consolidating these cases into one case, IN RE THE SPORTS
AUTHORITY, INC. SHAREHOLDERS LITIGATION, C.A. No. 16373NC.

The consolidated complaint relates to the merger agreement dated
May 7, 1998 between the Company and Venator Group, Inc., which
was terminated by mutual agreement in September 1998. The
complaint alleged that the Directors of the Company breached
their fiduciary duties to Company stockholders by entering into
the merger agreement without maximizing stockholder value, and
that the merger agreement's exchange ratio between Company
shares and Venator shares offered inadequate value to the
Company's stockholders. The complaint sought an injunction
against the merger, rescission of the merger if it had been
effected, monetary damages and attorneys' fees.

While this suit remains filed, the Company reports that the
plaintiffs have not pursued it.


SUN HEALTHCARE: Cohen Milstein Files Complaint in New Mexico
------------------------------------------------------------
The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. on
April 26, 1999, filed a lawsuit in the United States District
Court for the District of New Mexico on behalf of purchasers of
the common stock of Sun Healthcare Group (NYSE: SHG) during the
period between June 2, 1998 and February 1, 1999. The complaint
alleges that defendants issued false and misleading statements
which materially misrepresented the impact of changes in the
Medicare reimbursement system, implemented by the prospective
payment system ("PPS"), on the financial condition and financial
results of Sun Healthcare.

The Complaint alleges that defendants failed to disclose that
profit margins and reimbursement rates for ancillary services
would be substantially lower under PPS. The complaint also
alleges that defendants failed to disclose that the goodwill of
Sun Healthcare's domestic facilities had become impaired as a
result of the PPS. In addition, the complaint alleges that
defendants failed to disclose that the financial results of the
Company would also be materially and adversely impacted because
Retirement Care Associates, a company acquired by Sun
Healthcare, had been unprepared for the conversion to PPS.

To learn more, contact Steven J. Toll or Emma Larson at 888-240-
1238 or 206-521-0080 or at stoll@cmht.com or elarson@cmht.com
via email.



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S U B S C R I P T I O N  I N F O R M A T I O N

Class Action Reporter is a daily newsletter, co-published by
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Copyright 1999. All rights reserved. ISSN XXXX-XXXX.

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