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

               Thursday, June 3, 1999, Vol. 1, No. 85

                            Headlines

ALLSTATE INSURANCE: With Such Good Hands, Who Needs an Attorney?
AMERICAN FAMILY: Subscribers - You May Already be a Plaintiff
ASSOCIATES INSURANCE: May Demand Collateral Protection Insurance
CANDIE'S, INC.: Lowey Dannenberg Files Complaint in New York
DOW CORNING: Silicone Implant Settlement Hearing on June 28

EQUILON ENTERPRISES: Shell Franchisees Say They're Being Burned
FIRST MONEY: Insurers Not Racketeering, Says Federal Court
HAYFIELD UTILITIES: Residents Bring Sewer Fee Dispute into Court
LOEWEN GROUP: Cauley Firm Files Complaint in Pennsylvania
MICHIGAN: Court Says ADA Doesn't Require Blind to Vote Alone

NATIVE AMERICANS: Billions in Royalties Lost in the Shuffle
NEW YORK CITY: Arrestees May Continue HIV Medication Schedules
TOPPS CO: Updates NY and CA Insert Card Litigation
WELFARE BENEFITS: NY Medicaid Limits for Immigrants Struck Down


                            *********


ALLSTATE INSURANCE: With Such Good Hands, Who Needs an Attorney?
----------------------------------------------------------------
Since at least 1994 Allstate Insurance Co. has carried out a
nationwide strategy to keep people injured by their insureds
away from attorneys, say plaintiffs' attorneys and consumer
advocates. The strategy included contacting claimants soon after
the accident, sending them written documents with Allstate's
pledge to treat them like a "customer" and providing information
about the costs of hiring an attorney.

(This story, written by ANGELA WISSMAN, was published in the
Illinois Legal Times, June, 1999.)

Allstate's actions prompted attorneys general and insurance
regulators in several states to demand changes to the company's
representations; last fall the Pennsylvania attorney general
brought suit against the company, claiming its messages to
claimants violated consumer protection laws. A number of class
action suits have sprung up across the country, including one in
Chicago. The Chicago suit is the only national class action,
with class certification hearing scheduled for late July.

The lawsuits center around three documents Allstate sent to
claimants soon after their accidents. The first, titled
"Customer Service Pledge," says Allstate will treat the claimant
like "our customer and will provide you with quality customer
service." The second, "Do I Need an Attorney?" while reminding
claimants that the decision to hire an attorney is theirs, tells
claimants that attorneys often take up to one-third of a
settlement and increase settlement time. The last authorizes
medical and employment information to be released to Allstate.
The company still uses the documents, although with some
modifications.

Allstate claims the "Do I Need an Attorney?" pamphlet simply
gives claimants information about the claims process and facts
about an attorney's costs. After being bombarded with
advertisements from plaintiffs' attorneys over the years, many
claimants feel they have to have an attorney to settle claim,
says Allstate. The pamphlet tells consumers that they could
settle with the company directly and answers some of the
questions claimants typically have, Allstate says.

Consumer advocates argue the information is deceptive, because
it does not explain to claimants that Allstate represents
interests adversarial to them. Nor does it tell them that
Allstate saves money when attorneys do not become involved, says
James C. Peterson, a West Virginia attorney who is part of the
class action filed in Cook County.

"They are giving advice. They are giving it wrong. They ought to
be sued for malpractice. We have done that, and sued them for
fraud and misrepresentation," says Peterson, a partner at Hill,
Peterson, Carper, Bee & Deitzler in Charleston. "They lied. They
flat out lied to people."

Attorney Economics

Peterson's strong statements come from his belief that Allstate
knows it pays out larger settlements to those with an attorney,
but neglects to tell claimants that fact in the "Do I Need an
Attorney?" flier. The Chicago class action alleges that damages
for each member reach at least $ 8,677. The class took that
figure from a study done by the Insurance Research Council, a
non-profit organization supported by property and casualty
insurers. The IRC study found that gross bodily injury payment
for unrepresented claimants was $ 3,262 and for represented
claimants $ 11,939.

Allstate's own "Unrepresented Segment Training" materials state
that represented claims settle for two to three times more than
for unrepresented claimants. The materials state that in soft-
tissue cases ranging from $ 1,500 to $ 15,000, represented
claims settle for an average of $ 7,450 and non-represented
claims for an average of $ 3,464. The training materials,
obtained by a plaintiffs' attorney in a lawsuit against Allstate
and later sent to the American Trial Lawyer's Association, go
through a step-by-step process of how adjusters should address
claimants to give them the option of dealing directly with the
company without an attorney. The materials include survey
findings about when claimants are first contacted, their
predisposition to hiring an attorney and the key factors that
help eliminate attorney involvement. The materials also include
advice on what adjusters can and cannot tell claimants about
hiring an attorney.

In the materials the "recommended attorney economics script"
instructs adjusters to tell claimants, "Quite often our
customers ask if an attorney is necessary to settle a claim.
Some people choose to hire an attorney, but we would really like
the opportunity to work directly with you to settle the claim.
Attorneys commonly take between 25 to 40 percent of the total
settlement you receive from an insurance company plus expenses
incurred. If you settle directly with Allstate, however, the
total amount of the settlement is yours."

In a 1992 deposition William Boettcher, a former Allstate
attorney/adjuster in Phoenix, testified that one of the
Allstate's techniques was "claimant control," which meant
keeping control of the claimant so he or she did not hire an
attorney. The purpose of maintaining claimant control was "not
to keep the liability down, but to keep the value of the claim
down in terms of what you have to pay to settle it," Boettcher
testified.

Boettcher's deposition speaks about keeping the costs to settle
the claim down, not the actual pay out to the claimant. Although
the IRC found an $ 8,677 difference between settlements of
represented and unrepresented claimants, that number is
misleading, says Elizabeth A. Sprinkel, senior vice-president
and chief research officer of the IRC. Two factors cause the
higher settlement: Claimants with attorneys have higher economic
losses and roughly 33 percent of their settlement goes to paying
attorney fees and court costs, she says.

When reimbursements for economic loss, such as medical expenses,
lost wages and out-of-pocket expenses, and attorneys' fees are
removed, the difference between unrepresented and represented
settlements drops from $ 8,677 to $ 101, says Sprinkel. The net
return to the claimant is $ 1,608 for those with an attorney and
$ 1,507 to those without, she says.

Allstate has always had a policy of paying what the claim is
worth, says Allstate spokesperson Al Orendorff. Allstate's
intention is not to keep people away from attorneys, he says,
rather it is providing claimants with information to make their
own choice.

"The bottom line is we are focused on building a customer
experience that is second to none. That's what we have been
doing and our training manuals are designed to do that by
teaching claims people the most customer-focused and efficient
ways to do things," he says, "so we can communicate to people
what their options are."

Evolved from the '80s

Allstate probably began sending documents similar to the
"Customer Service Pledge" and the "Do I Need an Attorney?" flier
in the mid-1980s and then in the mid-1990s honed the program
down to an identifiable group of documents, says Peterson.

Plaintiffs' attorneys first found documented evidence of
Allstate's organized plan for unrepresented claimants in late
1996, says Florida attorney William "Chip" Merlin. In most bad-
faith litigation cases against Allstate the company obtains a
protective order over business documents, says Merlin, former
chair of ATLA's bad faith litigation committee. However, in one
case a judge refused to grant the order, he says. Allstate's
training material became available and Merlin received a copy of
seven or eight boxes worth of written training materials and
video tapes.

"That let cat out of the bag on what's going on, not only about
the letters but with their whole philosophy of attempting to
change and redesign their claims process," Merlin says. "It was
something that the leadership of Allstate had been talking about
to stock analysts for a number of years. We knew they were using
an artificial intelligence mechanism through COLOSSUS to see how
much to pay on claims and taking a hard line approach on
litigation. But we didn't know why, or how to prove why."

Along with the emphasis on keeping attorneys out of the process,
Allstate also reduces litigation costs by offering low
settlement offers on hard-to-prove soft tissue cases.

If the claimants refuse, Allstate then takes the case to trial
even if it would cost the company more than the claim is worth,
say plaintiffs' attorneys.

Merlin says only Allstate told claimants it would treat them
like customers and was the only company that specifically
trained adjusters to keep unrepresented claimants from hiring a
lawyer.

"Allstate's letters were an attempt to get around the regulation
that an insurance company should not attempt to dissuade
individual s from getting professional representation," Merlin
says. "Allstate came up with an entire training programming to
dissuade people from seeing attorneys, in ways they believed
were legitimate, such as explaining to claimants what attorneys
charge and how much longer it takes to settle a case with an
attorney. All of which we believe is an attempt not to help the
person out but to pay less money on the claim."

In addition to ATLA's materials, members of ATLA's Bad Faith
Litigation Group can call up a legal imagining company in Tampa,
Florida to receive 15,000 pages of Allstate's training manual on
CD-ROM and 60 VHS training videos.

Customer or Adversary?

Allstate and its class-action opponents differ fundamentally on
the insurance company's role with third party claimants. The
plaintiffs view the relationship as inherently adversarial,
while Allstate sees it as an extension of providing good service
to their own customers. Even though Allstate has changed the
name of the "Customer Service Pledge" to the "Quality Service
Pledge," the company still strives to provide third-party
claimants with a positive, service-orientated experience, says a
company spokesperson.

"In a day when many claimants are conditioned through
advertising to believe that a fair settlement is possible only
with the assistance of an attorney, this document presents
information that a claimant may find useful in deciding whether
to retain an attorney," reads Allstate's response to the West
Virginia unauthorized practice of law inquiry brought by
Peterson. "Claimants, as consumer of services, will determine
the most efficient and effective manner to deal with insurers."

However, the Pennsylvania attorney general's lawsuit says that
Allstate does not act for the interests of third-party claimants
as they claim. For instance, Allstate will only make an offer of
compensation that follows its own view of the claim, and will
only conduct an investigation that benefits itself and those its
insures, the complaint states.

"Consumers have the right to decide for themselves if they want
an attorney. They should not base that decision on the series of
deceptive statements that we contend Allstate was making,"
Pennsylvania Attorney General Mike Fisher says. "I find it hard
to believe that this insurance company can at the same time
represent its policyholders and the very people who were
injured-that's just nonsense."

Allstate does not regard third-party claimants as adversaries,
says Orendorff.

"We want everyone connected with an Allstate claims process to
feel they received the fastest and fairest claims service that
they could get, regardless of whether you are an Allstate
'customer' or a third party claimant," Orendorff says. "We
believe that you should provide people with the information they
need to make an informed choice and with a fast, fair claim
settlement process, so people come away feeling they received
the best claim treatment possible."

The mid-1990s have been banner years for Allstate. 1998 marked
the fourth consecutive year of record financial results. In 1994
the company had net income of $ 484 million. That jumped to $
3.3 billion in 1998. In that period Allstate's earnings per
share increased from $ .30 to $ 3.08 and the value of Allstate's
stock value increased by more than $ 21 million, up from $ 11.88
to $ 38.50 per share.

'Stealing Millions A Few Thousand at a Time'

Allstate's brochures go beyond providing general information
about the claims process, say plaintiffs. They point to the fact
that Allstate only sends the brochures to a specific group of
people after an accident. Attorney regulatory bodies in New
Jersey, North Carolina, Pennsylvania and West Virginia have
condemned Allstate's flyers as amounting to the illegal practice
of law. After the West Virginia Bar's Unauthorized Practice of
Law Committee ordered Allstate to stop sending the brochures,
Allstate took the matter to federal court based on First
Amendment grounds. The case awaits a Fourth Circuit ruling,
which could come this summer.

"I thought it was the worst form of the illegal practice of law
that I had ever seen," Peterson says. "Allstate had a nationwide
practice directed and orchestrated from Northbrook, Ill. The
practice has a manual, distributed to every claims office in the
country, instructing adjusters that in every case they were to
use a certain script and a certain set of documents to convince
people not to hire lawyers. The information was a fraudulent,
intentional and willful misrepresentation."

The proposed class in the Chicago suit includes everyone in the
United States who has been or will be involved in accidents with
Allstate policyholders and have received communication from the
company about deciding to be represented by counsel. The nation-
wide class could include between 300,000 to 500,000 people with
damages anywhere between $ 600,000 and several billion, based on
the average of $ 8,700 unrepresented claimants lose, they say.

"They all settled for amounts that we feel are dramatically
lower than what they could have achieved if they would have
gotten legal advice," says Robert L. Sklodowski, at Sklodowski,
Puchalski & Reimer in Chicago. "One of the plaintiffs has over $
10,000 in medical bills and lost wages and she settled for $
17,000 and the other had $ 14,000 in bills and he settled for $
14,000. In each case Allstate agreed that they were totally
liable."

The named plaintiffs in case testified in deposition that they
were persuaded by the documents and the adjuster's
representations, says Peterson, in part because few people want
to hire a lawyer, go to a doctor or pay anyone else for a
service.

"I don't believe Allstate is the devil, but the bottom line is a
corporation is run by money. You have stockholders that you
report to," Peterson says. "Allstate found a way to make money
and they did a good job of it. Unfortunately they took down
hundreds of thousands of people along the way in small claims.
You see, if you steal billions from a few, everyone says that's
terrible. But if you steal little bits from a lot you can
probably get by with it." (Illinois Legal Times; June, 1999)


AMERICAN FAMILY: Subscribers - You May Already be a Plaintiff
-------------------------------------------------------------
The Sun-Sentinel (Fort Lauderdale, FL) reports that collecting a
portion of a potential $46 million lawsuit settlement against
American Family Publishers could be as easy as entering a
sweepstakes. A class-action suit expected to be settled sometime
this fall could finally put some cash in the pockets of people
who bought magazines with the mistaken notion that it improved
their chances of winning a sweepstakes. Lawyers representing
hundreds of consumers and the company need to reach an agreement
on who is entitled to money and how it will be distributed, said
Scott Solkoff, a Deerfield Beach lawyer representing 65 clients
in the case.

American Family has turned over its customer records so lawyers
can figure out who should get money and how much, Solkoff said.
He said there is no need to call anyone to be eligible.

"People that have bought magazines are already known to the
court," he said. "Once everything is firmed up, the court will
certify the class." Those identified as the "class" will be
contacted by mail to find out whether they want to join the
lawsuit. "It's going to be a letter, one or two pages, people
will get that will give them the opportunity to opt in or opt
out," Solkoff said. His office was bombarded with phone calls
after the Sun-Sentinel reported the settlement of a government
lawsuit on Friday and that a separate, class-action settlement
was near.

Consumers who decide to "opt out" of the class-action case would
keep their right to sue the company on their own.

Solkoff expects the case to reach conclusion in the fall.
American Family acknowledged an agreement was close but would
not confirm financial details disclosed by Solkoff.

The magazine sales company hyped by pitchmen Ed McMahon and Dick
Clark agreed last week to settle a lawsuit with Florida and
three other states that claimed American Family's sweepstakes
notices misled consumers.

American Family agreed as part of that lawsuit to send out
honest mailings that prominently disclose an entrant's chances
and to no longer leave customers thinking they won when they
haven't.

Florida Attorney General Bob Butterworth said details are still
being worked out about distributing the proceeds of that
settlement. The line will be much longer to get a piece of the
separate settlement that Solkoff has been negotiating. He
recommends that people who think they are victims hang on to
whatever documentation they have and look for the letter a few
months from now. He has another reminder for consumers: "They do
not need to make a purchase to enter the sweepstakes. If you
want to buy a magazine, go ahead and buy one, but don't do it to
enter a sweepstakes." (Sun-Sentinel; June 2, 1999)


ASSOCIATES INSURANCE: May Demand Collateral Protection Insurance
----------------------------------------------------------------
The Civil RICO Report described how William and Gladys
Weathersby obtained consumer loans from The Associates Financial
Services Co. Inc., which were secured by real or movable
property. When the borrowers learned that the lender charged
them for placed collateral protection insurance (CPI) they filed
a class action complaint against The Associates, Associates
Financial Life Insurance Co., Associates Insurance Co.,
Associates Investment Co., Associates Corp. of North America and
Associates First Capital Corp.

Their complaint claimed that the defendants fraudulently force-
placed CPI on their loans and charged the cost of the allegedly
overpriced insurance to their original loan amount. According to
the plaintiffs, the defendants' practice of force-placing
insurance violated sections 962(a), (b), and (d) and caused them
to lose money by paying the overpriced CPI.

The defendants responded with a motion to dismiss for failure to
state a claim.

According to the story in the Civil RICO Report, consumers who
allege they suffered a monetary loss as a result of their
lenders' adding the cost of force-placed collateral protection
insurance to their original loan amount do not have a sufficient
"investment injury" or "acquisition injury" to sustain a RICO
claim. The borrowers must show that the investment of
racketeering profits caused the complained injury. (Civil RICO
Report; May 28, 1999)


CANDIE'S, INC.: Lowey Dannenberg Files Complaint in New York
------------------------------------------------------------
Lowey Dannenberg Bemporad & Selinger, P.C., has filed a class
action lawsuit in the United States District Court for the
Southern District of New York on behalf of purchasers of
Candie's, Inc. (NASDAQ:CAND) common stock from May 28, 1997
through May 12, 1999. The complaint charges Candie's and certain
of its officers with violations of the federal securities laws
which inflated the market price of Candie's stock.

The complaint alleges that defendants issued a series of false
and misleading statements that overstated the Company's
earnings. As a result of such conduct, the market price of
Candie's stock was overinflated. On May 12, 1999, after the
market closed, Candie's announced that the Company was not ready
to report fiscal 1999 results, despite having received an
extension of time to file such results. Candie's also announced
that it may have to restate earnings for fiscal 1998 and the
first three fiscal quarters of 1999, and that such financial
statements and financial information should not be relied upon.
On May 13, 1999, the Nasdaq Stock Market announced that trading
was halted in Candie's stock.

To learn more, contact Thomas Skelton, Esq. at 877-777-3581 or
write ldbs@westnet.com via email.


DOW CORNING: Silicone Implant Settlement Hearing on June 28
-----------------------------------------------------------
From Michigan, the United Press International reports that the
majority of more than 300,000 women plaintiffs have approved a
$3.2 billion plan to settle with former breast silicone implant
manufacturer Dow Corning.

The company says 94 percent of the claimants voted in favor of
the settlement. Dow is seeking to emerge from Chapter 11
bankruptcy in light of class action lawsuits brought by women
who claimed they were sickened by the implants. UPI says the
settlement now goes before a federal judge who could give it
final approval June 28.


EQUILON ENTERPRISES: Shell Franchisees Say They're Being Burned
---------------------------------------------------------------
The San Francisco Chronicle reports that Shell service station
dealers claimed filed a class-action suit claiming that Shell's
new marketing division jacked up rents and raised wholesale gas
prices to try to drive independent franchisees out of business
in California. Dennis DeCota, executive director of the
California Service Station and Automotive Repair Association,
said Shell's marketing arm is hoping dealers will go bankrupt so
the company can take over their stations.

The suit, filed in Contra Costa County Superior Court on behalf
of 200 Shell franchise owners in Northern California, alleges
fraud, unfair business practices and antitrust violations
against Equilon Enterprises, the joint marketing entity Shell
Oil Co. created with Texaco last year. DeCota told the SF
Chronicle the alleged squeeze reflects an industry trend that
has slashed the number of gas stations in California and eroded
competition. "We've got to turn this around or you're going to
be paying two or three dollars a gallon," he said.

Equilon spokeswoman Myra Jolivet declined to comment, saying the
company had not seen the suit.

DeCota has urged state Attorney General Bill Lockyer to
investigate Shell's role in the steep climb in gas prices after
accidents and maintenance problems at California refineries
threatened gasoline supplies early this year. DeCota claims
Shell led the price rises although its refineries were trouble-
free. DeCota held a press conference about the lawsuit outside
the former Shell refinery in Martinez as more than 40 dealers
and gas station employees picketed. Tanker truck drivers,
motorists, motorcycle riders and bus drivers honked horns in
support.

Marlin Swofford, who operates stations in Pleasant Hill,
Lafayette and San Ramon, said his rents went up by a total of
$24,000 a month after Equilon eliminated a rent-break program
that gave dealers an incentive to pump more gas.

Although Shell dealers sign contracts that allow Equilon to
charge rents up to $20,000 a month, franchisees could whittle it
down through a 4 1/2-cent rebate for every gallon they sold.
DeCota said Equilon eliminated that rebate last July, boosting
rents by as much as 400 percent at some stations within a 30-day
period. At the same time, Equilon raised the price charged to
dealers for every tank of gas they bought. Swofford said dealers
are left with an impossible choice between passing on the price
increases to customers and losing business to other stations, or
keeping pump prices low and absorbing huge losses.

The lawsuit asks for an injunction to roll back station rents to
the levels of August 1998. Swofford, a Shell dealer for 23
years, said two of his stations will go under if the rent
increases are not reversed. "This has been a productive network
for the last 20 years, and now they're just slapping the dealers
in the face," Swofford said. "You feel like you've been
deserted, betrayed." Jesse Perkins, who had hoped to pass on his
Shell station in Daly City to his two grown sons, instead had to
lay them off after the rent increases. Perkins said his rent
went from $2,250 a month in 1997 to $12,987 a month this year.
DeCota said longtime franchisees who had hoped to sell their
interests in their stations for as much as $1 million and retire
now believe they may have to walk away because their profit
picture has declined so sharply. He said Shell promised when
dealers signed their contracts that the top rent would be
charged only in the event of an oil embargo or other development
that would bring in huge profits for dealers and the company
alike. (San Francisco Chronicle; 06/02/99)


FIRST MONEY: Insurers Not Racketeering, Says Federal Court
----------------------------------------------------------
According to a story in the Civil RICO Report, credit life
insurance policy sellers avoided RICO liability in a purported
class action lawsuit. The U.S. District Court for the Eastern
District of Louisiana dismissed a 1962(a) claim absent
allegations of an investment injury. The 1962(c) claim also
failed to establish that the RICO defendants acquired or
maintained interest or control of the alleged enterprise.

Don Perrin filed this class action lawsuit amid allegations that
First Money LLC, Indirect Collections, Bank One, Louisiana and
Bank One Corp. fraudulently sold credit life insurance policies
which actually insured unearned interest that was never due. The
insurance policy sales allegedly failed to disclose pertinent
information and violated the Louisiana Motor Vehicle Sales
Financing Act. The original complaint set forth section 1962(a),
(b), (c) and (d) allegations, but Perrin later conceded that his
1962(c) claim lacked merit. The defendants moved to dismiss the
remaining claims. (Civil RICO Report; May 28, 1999)


HAYFIELD UTILITIES: Residents Bring Sewer Fee Dispute into Court
----------------------------------------------------------------
The Louisville Courier-Journal reports that subdivision
residents who've refused to pay their sewer bills - and face the
threat of service cutoff as a result - are suing to get what
they consider a fair rate. The residents sued in Oldham Circuit
Court Friday - the deadline Hayfield Utilities set for residents
to pay past bills or possibly be cut off.

Residents were put on notice two weeks ago that the utility
would take action to collect what's owed and review other
options, including plugging the line where it collects sewage
from a household.

Since January, about 80 of the 144 households have been paying
their bills into an escrow account set up by the homeowners'
association for Countryside, on U.S. 42 in the Prospect area.
Hayfield charges $99.96 every two months, twice last year's
rate. The lawsuit alleges that the rates are arbitrary,
excessive and not consistent with the level of service.

Hayfield Vice President Marty Cogan, who learned of the lawsuit
from a reporter Friday evening, said the utility will consult
with its attorneys to decide what to do about delinquent bills.
"Hayfield is clearly within its right (to set the rate)," he
said. "I don't feel we're being unreasonable. I don't know what
they hope to accomplish with a lawsuit."

But Ray Howard, president of the homeowners' group, said: "We
tried to negotiate. We were at a stalemate. This is the only
alternative I can see."

The rate dispute began in fall 1997 when Hayfield asked the
state Public Service Commission to raise the rate from $49.40
every two months to $108.78. In October 1998, the PSC approved
an increase to $65.20, but soon after, Hayfield closed the
Countryside treatment plant and began diverting sewage to the
recently enlarged plant serving Covered Bridge Farms next door.
Because Hayfield ceased being a plant operator, the PSC no
longer controlled its rates. Hayfield then raised the rate to
$99.96, starting with the December bills.

The Countryside Homeowners' Association and its sewer committee
chairwoman, Barbara Brothers, are seeking class action status to
represent all residents. They also want Oldham Circuit Judge
Dennis Fritz to issue a temporary injunction prohibiting
Hayfield from interrupting sewer service or taking steps to
collect on any past-due sewer bills. A hearing on a permanent
injunction also is sought.

They seek a trial to determine the rate and are requesting that
while the case is pending, Hayfield be allowed to collect only
the $65.20 fee the PSC approved. The suit asks that Hayfield be
ordered to pay for repairs of collector lines and dismantling of
the old plant. Property values are suffering, the suit contends,
entitling homeowners to damages.

Cogan has said in earlier interviews that the rate increase -
the first in 18 years - is needed to cover the increased cost of
business, plus the $60,000 that Hayfield spent repairing the
sewers. (Louisville Courier-Journal; 05/31/99)


LOEWEN GROUP: Cauley Firm Files Complaint in Pennsylvania
---------------------------------------------------------
A securities class action lawsuit has been filed by the Law
Offices of Steven E. Cauley, P.A., in the United States District
Court for the Eastern District of Pennsylvania on behalf of all
purchasers of securities of Loewen Group, Inc. (NYSE: LWN;
Toronto; Montreal) during the period March 5, 1997 through
October 6, 1998, the common stock purchased in the Company's
December 30, 1997 secondary offering and the Company's 7.2% and
7.6% Series 6 and Series 7 Senior Guaranteed notes.

The complaint alleges that Loewen Group and certain of its
officers and directors violated the federal securities laws by
misrepresenting or failing to disclose material information
about Loewen Group's results of operations, financial condition
and weaknesses in its financial internal controls which resulted
in the Company's failure to successfully integrate certain
corporate acquisitions. The lawsuit alleges that as a result of
defendants' false and misleading statements and omissions, the
price of Loewen Group's stock was artificially inflated. Later,
Loewen Group announced that its long-time Chairman and Chief
Executive Officer resigned upon request of the Board of the
Directors.

To learn more, email Steven E. Cauley, Scott E. Poynter, or Gina
M. Cothern at CauleyPA@aol.com or call 888-551-9944.


MICHIGAN: Court Says ADA Doesn't Require Blind to Vote Alone
------------------------------------------------------------
The Disability Compliance Bulletin reported that questions of
immunity did not bar a class action suit filed on behalf of
blind registered voters in Michigan. However, an appeals court
held that the Secretary of State for the State of Michigan did
not violate the ADA and Rehabilitation Act by refusing to make
certain methods of voter assistance available to individuals
with visual impairments. Nelson v. Miller, 15 NDLR 27 (6th Cir.
1999) (No. 97-1155).

In their complaint, the plaintiffs alleged that the secretary of
state, in her capacity as the state's chief election officer,
violated the ADA and Rehabilitation Act by refusing to implement
methods that would enable the plaintiffs to vote without the
assistance of others. The plaintiffs sought to permanently
enjoin the secretary of state from failing to implement the
requested voting methods in the future. The district court
granted the defendant's motion for dismissal. The plaintiffs
appealed. The United States entered the case as amicus curiae in
support of the plaintiffs' position.

First, the court concluded that Eleventh Amendment immunity did
not bar the suit. While courts have recognized an exception to
Eleventh Amendment immunity in instances where the state is in
actuality the real party in interest, as opposed to the state
official named in the complaint, the court reasoned that the
exception was not available to the defendant under the facts of
the case. Because the plaintiffs sought prospective relief in
the form of an affirmative injunction, as opposed to injunctive
relief that would apply retroactively and in all likelihood
involve money damages, the court determined this was not a claim
against the state. Consequently, the claim was not barred by the
Eleventh Amendment.

Next, the court determined that it was not necessary to reach
the issue of whether Congress abrogated Eleventh Amendment
immunity by enacting the ADA pursuant to the Fourteenth
Amendment, because the plaintiffs failed to state a claim as to
an ADA violation. As to the alleged ADA and Rehabilitation Act
violations, the court found that the state statute addressing
issues of assistance for voters with disabilities did not serve
to deprive the plaintiffs of their state constitutional right to
secrecy of the ballot. Further, there was no indication that a
different conclusion would have been reached by the state
supreme court.

Thus, the court determined that the secretary of state did not
violate the ADA and Rehabilitation Act when she refused to
extend assistance to blind voters other than the voting
assistance available to them under state law. Therefore, the
judgment of the district court dismissing the action was
affirmed. (Disability Compliance Bulletin; May 20, 1999)


NATIVE AMERICANS: Billions in Royalties Lost in the Shuffle
-----------------------------------------------------------
According to a story in The Washington Post, Ripley Berryhill
says the U.S. government owes his family millions of dollars in
royalties from oil pumped from beneath 160 acres of land it
allotted to his grandmother in 1903. But he wonders if he will
live long enough to see any of it.

Berryhill, 59, a Muskogee Creek Indian who lives a hardscrabble
existence on about $ 8,000 a year in disability checks, stood
before a wellhead on Nettie Tiger Berryhill's allotment recently
and tried to do the math: 122,478 barrels extracted from the
time she died in 1943 until 1970, when his search of oil-pumping
records reached a dead end. With Oklahoma sweet crude selling
for $ 16 a barrel now and some of the most profitable years
coming after 1970, the yield obviously was going to be enormous.

"We never could figure out what it'd be worth all added up, but
some lawyers we talked to in Tulsa said, 'You're talking $ 12
million to $ 15 million easily,' " Berryhill said. "That's a lot
of money for someone in my situation."

But Berryhill and his grandmother's 27 other living heirs have a
problem. Or, more precisely, they have several problems.

First, the Bureau of Indian Affairs never completed a probate of
Nettie Berryhill's will, as it was required to do as the trustee
of allotted Indian lands, Berryhill said. Then, inexplicably,
the BIA sold the land and the oil rights that went with it,
without any of the proceeds going to family members, Berryhill
said. But the biggest problem of all, Berryhill discovered, is
that most of the documents concerning the oil leases cannot be
found.

"It's like going around in circles," said Berryhill, who has
visited document archives in Tulsa, Oklahoma City and even Fort
Worth in search of records to prove his case. "They send you
from one office to another and you end up right where you
started."

Berryhill's is one of thousands of American Indian claims
against the federal government for mismanaging over the last
century assets held in trust by the government that conceivably
could result in compensatory payments reaching into the tens of
billions of dollars.

The Interior Department, of which the BIA is a part, says it is
trying to straighten out 350,000 unreconciled trust accounts
held by individual Indians and 1,500 more tribal accounts that
go back to 1887, when the government began breaking up
reservations and allotting small parcels of 40 to 160 acres to
individual tribal members. The allotments were part of the
government's assimilation policy, which at the time was intended
to dismantle Indian reservations and disperse tribes across the
country.

The trust accounts often were created to hold assets for minors
or to collect and hold royalties from the sale of petroleum,
natural gas, timber and other natural resources extracted from
the transferred land, with income supposedly being passed on to
descendants of the original beneficiaries.

But BIA officials admit that many records covering the 55
million acres of land it manages in trust--as well as those for
the 350,000 landowners, 100,000 active leases and 2 million
individual owner interests--have been lost over the last century
in a maze of antiquated record-keeping. Despite periodic
proddings from tribal leaders, federal courts and Congress,
government accountants and outside analysts have been unable to
reconcile the records, or in many cases even ascertain if
royalty checks were issued or cashed.

The BIA acknowledges that there are people like Nettie Berryhill
who died 50 or more years ago and whose wills, containing
potentially huge trust assets, have not been probated. Keith
Harper, an attorney with the Washington-based Native American
Rights Fund, called the BIA's handling of the accounts a
"complete abrogation of their fiduciary responsibility."

Kevin Gover, assistant interior secretary and head of the BIA,
said he could not comment on individual trust cases. "We can't
respond to horror stories. If we release information about how
much land someone owns, we can be sued," Gover said.

In fact, Gover and Interior Secretary Bruce Babbitt already are
the targets of a class action lawsuit filed on behalf of more
than 300,000 Native Americans who say they have been deprived of
billions of dollars in trust funds. The case is scheduled to go
to trial this summer.

In February, Babbitt and Gover were cited for contempt of court
by U.S. District Judge Royce C. Lamberth for showing a "flagrant
disregard" of the judge's order to produce trust account
documents for the trial. Lawyers for the two officials said that
the documents could not be produced because they could not be
found.

In 1994, after spending $ 21 million for an outside audit of two
decades' worth of accounts, the BIA acknowledged that it was
unable to adequately document $ 2.4 billion in tribal trust fund
transactions. While it has not been ascertained that the money
is actually missing, documents cannot be found to show where
much of it came from and where--or even if--it was paid,
officials readily admit.

BIA officials say that in many cases the money has not gone
anywhere because checks never even left the Treasury Department.
There was no place to send them because the heirs of the
original trusts could not be found.

Babbitt, in a meeting with reporters last week in Washington,
said: "There are no huge sums of money missing. It is a lack of
documentation, a lack of evidence."

In response to questions, however, Babbitt acknowledged that
there was no way of knowing how much money was missing and how
much was actually paid out until the process of reconciling
trust accounts is completed.

Officials say that documents are scattered in disarray in dozens
of government warehouses around the country without any cross-
indexing and sometimes without source identification. In the
case of the main BIA document center in Albuquerque, long-
forgotten trust records were contaminated with rat feces
containing a dangerous virus and therefore were considered
inaccessible by bureau employees.

Audits have found that more than 45,000 accounts are for
individuals whose whereabouts are unknown; 21,000 are for people
who have died; 128,000 accounts have no Social Security or tax
identification numbers; and $ 21.7 million is being held
ostensibly for minors who have long since reached adulthood.

Many of the trust fund accounts involved "fractionalized"
landholdings that over many years have been divided among so
many heirs that the value from leases and other sources of
income often is less than $ 1 per person. Gover said he receives
as little as 7 cents a year on a mineral interest that once
belonged to his great-grandfather, a Pawnee Indian, even though
it costs the Interior Department $ 35 to handle such an account.

Gover said the BIA had "recorded proof" of only $ 15 million to
$ 25 million in errors, and that it was unfair of bureau critics
to make Indian trust holders think that "their ship is coming
in" with billions of dollars in compensation. "From what we've
seen so far, there is not $ 1 billion in mistakes," Gover said.

However, attorney Harper called Gover's $ 15 million to $ 25
million estimate "ridiculous" and, noting that $ 350 million
goes through the trust system each year, said, "We believe it
will be multi-billions of dollars in aggregate corrections."

Dennis Gingold, another lawyer for the Indians, said a
preliminary estimate by the Price Waterhouse accounting firm,
which was hired by the Native American Rights Fund to study the
government trust records, shows that the Indians are owed at
least $ 10 billion--more than the Interior Department's entire
annual budget.

Eloise Cobell, a Blackfoot Indian and the lead plaintiff in the
class action lawsuit against the department, said money that was
supposed to transform Indians from welfare dependents into
landowners and pay for college educations has been mismanaged,
diverted, lost and--in some cases--stolen or never collected.
She said powerful corporations in Oklahoma drill for oil and
timber companies in the Pacific Northwest harvest trees under
what is essentially an honor system. Moreover, rich potato land
in Idaho is leased at below market rates and ranchers in Montana
graze their cattle on Indian trust lands for free, she said.

"They are totally wrong when they say this [reconciling trusts]
won't affect the lifestyles of poor people," Cobell said. "I'm
seeing people die poor every day when they actually have a hell
of a lot more money that should be in their accounts."

In an effort to sort out the fund, the Interior Department is
spending $ 60 million on a new computer system that is scheduled
to make its debut next month at a BIA regional office in
Billings, Mont. The system is supposed to not only reconcile the
challenged trust accounts, but also give Indians a way to check
their funds at any time and link the accounts with the
department's land records.

However, the General Accounting Office, in a report issued last
month, said off-the-shelf accounting software the BIA purchased
to cut down on planning time could be inadequate for the task.
The GAO said the bureau went ahead with the project without
thoroughly analyzing its needs and without ensuring that it will
be able to handle trust data linked to different systems.

Such debate makes little impression on Indians such as Rosalie
Taylor Grothaus, a 61-year-old Seminole who last week visited
her grandmother's original 160-acre allotment near Bowlegs,
about 20 miles east of here, and watched oil being pumped out of
a well there. A sign on the well identifies it as "Molleah
Taylor No. 4"--Molleah Taylor was Grothaus's grandmother--but no
one in the family has received any royalties from the well in
years, Grothaus said. (The Washington Post; June 02, 1999)


NEW YORK CITY: Arrestees May Continue HIV Medication Schedules
--------------------------------------------------------------
New York City officials have agreed in principle to new
procedures that would allow HIV-positive detainees awaiting
arraignment to have an uninterrupted supply of prescription
drugs. The policy change, part of a class-action 1992 lawsuit
challenging unsanitary conditions at 10 city jails, was prompted
by arrests last fall of more than 100 marchers at a rally
protesting the murder in Wyoming of gay college student Matthew
Shepard. Some of those arrested on disorderly conduct charges
were HIV-positive and were deprived of their medications for an
entire day. The antiretroviral drugs can become resistant to the
virus if treatment is interrupted for even a short while.

Under existing policy, people who are arrested must surrender
any medicines they have in their possession. The drugs are
returned to them after arraignment, a procedure that can take 24
hours on average. Until recently, people charged with minor
offenses were released immediately if they were on medication.
Police would give them a desk arraignment ticket and direct them
to report for their arraignment later that day or the following
day. That policy of leniency ended when Mayor Rudolph Giuliani
decided to crack down on nuisance crimes. He ended the practice
of issuing desk arraignment tickets for minor offenses.

The policy had the unintended consequence of imposing hardships
on people who needed medications, forcing them to remain in jail
for up to a day pending their arraignment. Several detainees
with serious medical conditions, such as insulin-dependent
diabetes and asthma, suffered health complications while
awaiting arraignment because they were denied their medications,
according to Susan Hendricks, director of litigation for the
Legal Aid Society, which filed the lawsuit. She said there was
at least one death. The people arrested in the Shepard rally
attracted publicity to the issue, which prompted the city to re-
evaluate its medication protocols, Hendricks said.

Under the new policy, if detainees are carrying medication with
their names on prescription labels, they will be taken to a
hospital emergency room, where a doctor will evaluate their
condition. The doctor can allow detainees to keep their
medication while in jail. When the detainee returns to a pre-
arraignment holding cell, an emergency medical technician will
supervise the use of the medicine. If a person doesn't have
medicine on them, the emergency room doctor can issue a
temporary supply. The new policy will also take into account the
existence of experimental medicines still in clinical trials.
The doctor can request the police to fetch the medicine from a
family member or life partner and take it to the hospital for
the detainee's use.

City officials were not available for comment.

The precise language of the policy - and other aspects of the
settlement - remains in negotiation. "We have a trial date
scheduled for June 21," Hendricks said. "Obviously, we need to
finalize this before then if we are to avoid a trial. I'm fairly
optimistic. The medication issue was a particularly thorny issue
to resolve." The settlement would cover other aspects of the
lawsuit, including unsanitary conditions in the jails,
overcrowding, and lack of access to food and telephone calls.
(AIDS Policy and Law; May 28, 1999)


TOPPS CO: Updates NY and CA Insert Card Litigation
--------------------------------------------------
In August 1996, TOPPS CO INC was named a defendant in a class
action in the United States District Court for the Eastern
District of New York entitled Sullivan, et.al. v. The Topps
Company, Inc. No. CV 96 3779 (E.D.N.Y.). The Action alleged,
among other things, that the Company violated the federal
Racketeer Influenced and Corrupt Organizations Act by its
practice of selling sports and entertainment cards with
randomly-inserted insert; cards, in violation of state and
federal anti-gambling statutes. During the last two and a half
years, each of the Company's principal competitors, and
principal licensors, were separately sued in various federal
courts for employing, or participating in, the same or similar
practices. The Action sought treble damages and attorneys' fees
on behalf of all purchasers of packs of cards potentially
including "insert" cards over a four-year period.

The New York Court granted the Company's motion to dismiss the
Action with prejudice in August 1997. The New York Court later
denied motions by plaintiffs to alter, amend or vacate the
judgement, and for leave to file an amended complaint.
Plaintiffs' time to appeal all of these rulings has expired, and
the judgement for the Company dismissing the Action is now final
and nonappealable.

In September 1998, the Company filed an action in the New York
Court seeking declaratory and injunctive relief against a class
of all original end-use purchasers of trading cards marketed in
packages that may contain randomly-inserted "insert" cards
within the four years prior to the filing of the complaint,
entitled The Topps Company, Inc. v. Sullivan et al., No.l CV 98
6023 (EHN) (E.D.N.Y.) (the "Declaratory Judgment Action"). The
Declaratory Judgment Action seeks a declaratory judgment that
the defendant class of card purchasers did not suffer any injury
cognizable under RICO by this practice, and an injunction
enjoining the defendant class from filing or pursuing any
further RICO actions against the Company relating to the
purchase of trading cards. Two similar declaratory judgment
actions have been filed by several of the Company's principal
licensors against the same class of defendants in the New York
Court.

On December 14, 1998, defendants in all of the declaratory
judgment actions moved to dismiss the complaints, and the New
York Court heard oral argument on the motions on February 26,
1999. A decision in these motions has not yet been rendered.

In November 1998, the Company was named defendant in a purported
class action commenced in the United States District Court for
the Southern District of California (the "California Court")
entitled Rodriquez et al. v. The Topps Company, Inc., No. CV
2121-B (AJB) (S.D. Cal.) (the "Class Action") The Class Action
alleged that the Company violated RICO, and the California
Unfair Business Practices Act, by its practice of selling sports
and entertainment trading cards with randomly-inserted "insert"
cards, allegedly in violation of state and federal anti-gambling
laws. The Class Action seeks treble damages and attorneys' fees
on behalf of all individuals who purchased packs of cards at
least in part to obtain an "insert" card over a four-year
period.

On January 22, 1999, plaintiffs moved to consolidate the Class
Action with similar class actions pending against several of the
Company's principal competitors and principal licensors in the
California Court. The Company has opposed this motion. On
January 25, 1999, the Company moved to dismiss the complaint,
or, alternatively, to transfer the Class Action to the Eastern
District of New York or stay the Class Action pending the
outcome of the Declaratory Judgment Action pending in the
Eastern District of New York.

By orders dated May 14, 1999, the California Court denied Topps'
motions to dismiss the complaint or transfer the Class Action to
the Eastern District of New York but granted Topps' motion to
stay the Class Action pending the outcome of the Declaratory
Judgment Action. The California Court also denied plaintiffs'
motion to consolidate the Class Action with similar purported
class actions. An unfavorable outcome in the Class Action could
have a material adverse effect on the Company's future plans and
results.


WELFARE BENEFITS: NY Medicaid Limits for Immigrants Struck Down
---------------------------------------------------------------
The New York Law Journal reports that a Manhattan Supreme Court
Justice struck down as unconstitutional a provision of New
York's 1997 Welfare Reform Act which eliminated Medicaid
coverage for certain lawful immigrants. In a 17-page decision in
Mohammed Aliessa v. Dennis Whalen, as Acting Commissioner of the
New York State Department of Health, Index No. 403748/98,
Justice Sheila Abdus-Salaam ruled that @ 122 of the Social
Services Law, part of the Welfare Reform Act, violates both the
federal and state constitutions.

Applying strict scrutiny analysis to the provision, the court
concluded that state welfare laws which condition benefits on
citizenship and duration of residency violate the Fourteenth
Amendment's equal protection clause. "It has long been settled
that the equal protection clause entitles both citizens and
aliens to the equal protection of the laws of the State in which
they reside...," wrote Judge Abdus-Salaam. "Section 122...
creates classifications of legal aliens and restricts the
availability of public assistance benefits based upon those
classifications," she added.

The court also concluded that the law runs afoul of Article 17
of the State Constitution, which requires "the State to provide
aid, care and support for the needy." Judge Abdus-Salaam wrote
that the main objective of Article 17 is to make medical care
available to everyone, "regardless of race, age, national origin
or economic standing."

Before the enactment of the Welfare Reform Act, New York
provided Medicaid to persons residing under the color of law and
lawful permanent residents who were not eligible for federally
funded Medicaid. The state-funded Medicaid program provided
coverage to residents between the ages of 21 and 65 who were not
blind or disabled or taking care of minor children, but whose
resources fall below New York State's Public Assistance
"standard of need," as defined by the Social Services Law.

The state Legislature passed the Welfare Reform Act in response
to the federal Personal Responsibility and Work Opportunity
Reconciliation Act of 1996, (PRWORA) which mandated that
federally funded Medicaid could no longer be provided to certain
immigrants, including most lawful permanent residents, who
entered the United States on or after Aug. 22, 1996.

After Congress passed the federal welfare reform law, officials
in many states feared that as a result of the diminished federal
funds the states would have to spend more to provide medical
care for indigent immigrants. Several states with large
immigrant populations, including New York, passed laws limiting
state-funded welfare benefits to their residents.

On Oct. 16, 1998 the Legal Aid Society, the New York Legal
Assistance Group and the Greater Upstate Law Project, filed suit
challenging the state law on behalf of eight lawful immigrants
who reside in New York with the knowledge and permission of the
Immigration and Naturalization Service. The groups sought a
declaration that New York's restrictions are unconstitutional.

Each plaintiff has a potentially life threatening medical
condition and meets the Medicaid program's financial eligibility
criteria, but has been denied state coverage due to his or her
immigration status, wrote Judge Abdus-Salaam. For example, Abdul
Monir, 61, a lawful permanent resident, suffers from end-stage
renal disease which requires kidney dialysis twice weekly and
medication, neither of which he can pay for without Medicaid.

The action is styled as a class action and Legal Aid filed for
class certification in January. Although the class certification
motion was held until after the judge's decision, Elisabeth
Benjamin, the Legal Aid lawyer who brought the case, said both
sides will be briefing this issue soon.

"New York has been the port of entry to immigrants for the last
300 years," said Ms. Benjamin. "New York cannot just pick and
choose which immigrants to give aid to... A state cannot favor
one group of residents over another," she added.

Michael Siller, the Assistant Attorney General who argued the
case on behalf of the State would not comment on the decision.
He said state officials had not decided whether to appeal.

Judge Abdus-Salaam's ruling came on the heels of the U.S.
Supreme Court's opinion on Monday which held that a state cannot
pay less to welfare recipients who have recently moved to one
state from another state. In Saenz v. Rose, Justice John Paul
Stevens writing for the 7-2 majority, struck down California's
two-tier system, which limited new state residents in their
first year in California to the amount of benefits they would
have received in their prior state.

According to Ms. Benjamin, both cases are related and both
decisions relied on the Fourteenth Amendment to overturn the
discriminatory state laws. "Both cases send a message to the
states that there is a line in the sand," said Ms. Benjamin.
"The federal government can make rules as to newcomers but the
states cannot. We need some kind of consistency throughout the
country," she added. (New York Law Journal; May 19, 1999)



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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

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Copyright 1999. All rights reserved. ISSN 1525-2272.

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