CAR_Public/990614.MBX              C L A S S   A C T I O N   R E P O R T E R

               Monday, June 14, 1999, Vol. 1, No. 92

                            Headlines

ALCATEL: Class Decision Later This Year, Possible Trial in 2000
AMERICAN HOME: Trying to Settle Norplant and Fen-Phen Suits
CA STATE FUND: Win for Workers' Compensation Agency Put on Hold
CANDIE'S, INC.: Abbey Gardy Files Complaint in New York
CANDIE'S, INC.: Berman DeValerio Files Complaint in New York

CELLSTAR CORP.: Shepherd & Geller File Complaint in Florida
CHERRY HILL TOYOTA: Facing Class Claim for NJ Consumer Fraud
FIRST UNION: Investors Complain About CoreStates Takeover Losses
FLORIDA PANTHERS: Plaintiffs Miss Deadline to Amend Complaint
POLAROID CORP.: Shareholders Complain About False Statements

PRESCRIPTION DRUG LITIGATION: Pharmacies Push HMO Discount Claim
PRISON REALTY: Abbey Gardy Files Complaint in Tennessee
PRUDENTIAL INSURANCE: FL Law Precluding Punitives Doesn't Apply
RAY SCOTT: Judge Finds Nothing Fishy with Founder of BASS Inc.
SOUTHWIN INC.: FL Homeowners Awarded $5.2 Million from Developer

VITAMIN LITIGATION: Class Settlement Talks Around $800 Million
WWII REPARATIONS: German Companies Provide Funds for Slave Labor


                            *********


ALCATEL: Class Decision Later This Year, Possible Trial in 2000
---------------------------------------------------------------
Alcatel officials said that a judge has been assigned to deal
with class action suits brought in the U.S. against Alcatel over
the profit warning, and a decision on whether the action is
admissible will probably be made in the second half of this
year. If the cases go ahead, a jury will hear them by the end of
2000, they said. (AFX News; June 10, 1999)


AMERICAN HOME: Trying to Settle Norplant and Fen-Phen Suits
-----------------------------------------------------------
American Home Products is negotiating to settle lawsuits
involving 40,000 women nationwide who allege that they were
injured by its Norplant contraceptive. And analysts say the
company may be gussying itself up for a corporate marriage.

Roger Brosnahan, a Minneapolis lawyer involved in the
negotiations, said the Norplant talks have been going on for
more than a year. A published report put the potential value of
a settlement at $ 100 million. "There are lots of issues
involved, and we're trying to get them resolved," Brosnahan
said. "Both sides are trying to reach an accommodation."

AHP spokesman Lowell Weiner and Doug Petkus, a spokesman for the
company's Wyeth-Ayerst Laboratories subsidiary, declined to
comment Wednesday.

The negotiations to settle the Norplant suits come as AHP
attempts to craft a nationwide settlement of lawsuits by people
who say they were injured by the fen-phen diet drug combination.
The company marketed half the fen-phen combination under the
brand names Redux and Pondimin until 1997, when the products
were pulled from the market after studies linked them to leaky
heart valves and pulmonary hypertension in 30 percent of
patients. More than 2,600 lawsuits, including 70 class-action
suits, have been filed over the drugs. Lawyers involved in the
negotiations say the national settlement could be worth as much
as $ 5 billion.

Wall Street analysts say the side-by-side negotiations over
Norplant and fen-phen suggest that AHP may be getting ready to
take over another drug company. AHP, the world's seventh-largest
drug maker, called off a merger with the agricultural products
giant Monsanto eight months ago.

"A hundred million in lawsuits spent for Norplant would be a
good way to put that sorry situation behind that company," Neil
Sweig of Southeast Research Partners in New York said Wednesday.
"American Home is an acquiring-oriented company.... If they
could put the fen-phen legalities behind them, it would be
brighter for the company to find the right merger partner. Many
of the unknowns would have been dispensed with."

The Norplant birth-control device, which won U.S. Food and Drug
Administration approval in 1990, has been implanted in 4.5
million women worldwide, including about 1 million in the United
States. It consists of six silicone rods filled with
levonorgestrel, a synthetic hormone, that are implanted in the
arm. It is supposed to prevent pregnancy for five years.

According to a recent AHP filing with the U.S. Securities and
Exchange Commission, 3,732 lawsuits involving 39,580 plaintiffs
have been filed over Norplant as of April 26.

The lawsuits generally allege that AHP failed to warn patients
about the severity of possible side effects associated with the
device, including irregular menstrual bleeding, weight gain,
headaches, and depression. AHP maintains that the side effects
were well known.

The Dallas Morning News, which reported the settlement
negotiations last month, quoted unidentified lawyers as saying
that the deal, if it happens, could be worth as much as $ 100
million.

The courts, so far, have largely sided with AHP. Although one
statewide class-action suit has been certified in West Virginia,
a request for class-action status in a federal suit was denied,
and dozens of state and federal lawsuits have been dismissed or
withdrawn.

The 5th U.S. Circuit Court of Appeals ruled in January that AHP
did not have to warn patients about potential dangers as long as
the treating physician had been told. Of the four cases that
have gone to trial, two ended with verdicts in favor of AHP, one
ended in a mistrial, and one was a mixed bag. In that case, the
judge entered a $ 38,000 judgment against AHP for one plaintiff,
but the claims of three others were dismissed.

In its SEC filing, AHP said it did not expect the outcome of the
lawsuits to have a material adverse effect on the company's
financial position, but that it could have a short-term impact
on operations.

Even if the company is not readying itself for a merger, one
analyst said paying $ 100 million to wash its hands of the
Norplant litigation would be a bargain.

"They'd like to get this off their books," said Hemant Shah of
HKS & Co. in Warren. (The Record (Bergen County, NJ); June 10,
1999)


CA STATE FUND: Win for Workers' Compensation Agency Put on Hold
---------------------------------------------------------------
What was almost a major win for the State Fund and a cause
celebre for the entire workers' compensation industry was turned
instead into a hopeful waiting game by an Orange County judge.
After actually issuing a tentative ruling May 20 that the
Schaefer Ambulance v. State Compensation Insurance Fund case
should be thrown out of court, an Orange County (CA) Superior
Court judge decided the following day to delay issuing a final
ruling until July 23.

The judge made his decision in response to successful arguments
by plaintiffs' counsel - Roxborough, Pomerance, Gallegos & Nye -
that he should hold off on his decision due to activity on a
similar case. Judge Robert Jameson will wait until the
California Supreme Court makes its own decision on whether a
similar and recent precedent-setting decision in favor of
insurers should be de-published.

The Schaefer Ambulance case is the lead case for about 25 class
action suits, all of which contain the same causes of action:
that various insurers improperly accounted for medical-legal
expenses drove employers X-Mods (experience modification
factors) up, raising their costs. Schaefer and the other cases
have worn on the industry, and one insurer recently settled a
Schaefer-like case for $30 million, according to attorneys in
the know.

The near-decision to throw the case out almost turned out to be
the final chapter for this case. The Schafer Ambulance case now
hinges on another case.

California's Second District Court of Appeal in March held that
the VPS Management Inc. v. Pacific Rim Assurance Co. case did
not belong in the state civil court system and should instead be
heard through an already established complaint process outside
the state court system. The case was published in April and VPS
agreed to a settlement rather than filing an appeal with the
Supreme Court.

Other interested parties, including law firms representing other
employers in similar causes of action, have sent letters to the
state Supreme Court asking it to de-publish the VPS decision.

While the insurance industry and the Workers' Compensation
Insurance Rating Bureau have written their own letters urging
the court to allow the publication - hence precedent - to stand,
the Department of Insurance has weighed in with its own letter
asking that it be de-published.

Heywood Friedman, the attorney that represented Pacific Rim,
said that the Supreme Court could make a decision on the
publication issue as early as the first half of June.

Plaintiffs' attorneys admit that the VPS decision has
essentially hamstrung them in their efforts to negotiate
settlements with insurers. The decision in hand, insurers have
seen no need for further discussions. They argue as the
appellate court did that disputes of this nature should be
decided by the Workers' Compensation Insurance Rating Bureau's
complaint process for employers.

In its decision, the appellate court cited Insurance Code
Section 11758: "No act done, action taken or agreement made
pursuant to the authority conferred by this article shall
constitute a violation of or grounds for prosecution or civil
proceedings under any other law of this State heretofore or
hereafter enacted which does not specifically refer to
insurance."

The VPS case has had an effect on many other Schaefer Ambulance-
type cases. "Other judges are doing about the same as Judge
Jameson," says Friedman. "They're saying, 'let's see what the
Supreme Court does.' This is an area of compliance that
insurance code regulates, and companies should not be subjected
to potential exposure of punitive damages and exorbitant
attorneys fees."

Orange County Superior Court Judge Jameson, also dismissed
Schaefer's motion to add causes of action that included
violations of Business and Professions Code Section 17200 as
well as allegations that State Fund over-reserved for claims,
which would have inflated premium costs for Schaefer. He refused
to certify the case as a class action.

Noting that those causes of action are already included in the
A&J Liquor v. State Compensation Insurance Fund class action,
Jameson dismissed those causes of action as well, Friedman says.

Although Roxborough Pomerance convinced Jameson to hold off on
his decision to throw the Schaefer Ambulance case out until the
issue of publication is decided by the state Supreme Court, some
observers think the damage is already done. "I don't know if the
Supreme Court de-publishes that it will put an end to the
question," says Michael McClain, counsel for the California
Workers' Compensation Institute. "A lot of people have already
filed VPS motions."

Schaefer and other employers filed suit against the State Fund
in 1994, but the trial judge ordered the case remanded to the
Workers' Compensation Insurance Rating Bureau, which fields
employer complaints about X-Mods and other rating issues.

The WCIRB sided with Schaefer, and later, a Department of
Insurance administrative law judge issued a proposed decision
affirming the WCIRB's decision.

Insurance Commissioner Chuck Quackenbush adopted the ALJ's
decision and State Fund filed a petition for reconsideration.
The DOI urged State Fund and Schaefer as well as two other
employers to enter into mediation.

Just as the parties were preparing to enter the mediation that
Quackenbush had ordered, Quackenbush abruptly denied State
Fund's motion for reconsideration, which gave plaintiffs'
counsel a leg up and effectively ground the ordered mediation to
a halt. Since then the Schaefer case and related cases are
proceeding in court or parties have entered into settlement
negotiations. (Workers' Comp Executive; June 9, 1999)


CANDIE'S, INC.: Abbey Gardy Files Complaint in New York
-------------------------------------------------------
The Law Firm Of Abbey, Gardy & Squitieri, LLP; filed a class
action on behalf of all purchasers of Candie's, Inc. (NASDAQ:
CANDE) stock between May 28, 1997 and May 12, 1999; and all
investors whose New Retail Concepts, Inc. (NRC) stock was
exchanged for Candie's Inc. stock pursuant to the August 18,
1998 merger. The lawsuit has been commenced in the United States
District Court for the Southern District of New York against
Candie's, Inc. and certain of its officers and directors.

To learn more, call Mark C. Gardy, Esq. or James S. Notis, Esq.
at 800-889-3701 or 212-889-3700 or jnotis@a-g-s.com via email.


CANDIE'S, INC.: Berman DeValerio Files Complaint in New York
------------------------------------------------------------
Candies, Inc. (Nasdaq: CAND) was charged with overstating its
revenues and earnings in a shareholder class action filed by
Berman, DeValerio & Pease LLP in the United States District
Court for the Southern District of New York on June 10, 1999.
The case, which alleges violations of Sections 10(b) and 20(a)
of the Securities Exchange Act of 1934, was filed on behalf of
all persons and entities who purchased the common stock of
Candie's, Inc. from May 28, 1997 through May 12, 1999.

According to the complaint, defendants falsely reported Candie's
Inc.'s financial results for the first, second, third and fourth
fiscal quarters of 1998, fiscal year 1998 ended January 31,
1998, and the first, second, and third fiscal quarters of 1999
causing Candie's Inc.'s common stock to trade at artificially
inflated prices. Following defendants' May 12, 1999 disclosure
that Candie's Inc. may be required to restate its financial
results, NASDAQ halted trading of the Company's common stock.

To learn more, email Kathryn A. McElroy, Esq. or Jeffrey C.
Block, Esq. at bdplaw@bermanesq.com or call 800-516-9926.


CELLSTAR CORP.: Shepherd & Geller File Complaint in Florida
-----------------------------------------------------------
Shepherd & Geller filed a class action lawsuit on June 9, 1999
charging Cellstar Corp. with securities fraud. The suit was
filed in Florida District Court on behalf of purchasers of
Cellstar common stock from March to September 1998.

The complaint charges that Cellstar violated securities law by
making false statements on its financial condition, causing the
stock to trade at artificially inflated prices. (Communications
Daily; June 10, 1999)


CHERRY HILL TOYOTA: Facing Class Claim for NJ Consumer Fraud
------------------------------------------------------------
In Cannon v. Cherry Hill Toyota, Inc., Civ. No. 97-3722; in the
United States District Court (DNJ), plaintiff was held to have
satisfied the criteria under Federal Rule of Civil Procedure 23
for class certification of the approximately 2,300 consumers who
have claims virtually identical to hers. The action alleges that
defendant failed to reveal that it had retained a portion of the
retail sales installment contract plaintiff purchased for
$1,167, thereby violating the Truth in Lending Act and the New
Jersey Consumer Fraud Act.

Cannon proposes to represent a class consisting of "all
consumers who purchased since July 1991 a service contract or
extended warranty from Cherry Hill Toyota in connection with the
purchase of a vehicle which was documented in a form retail
installment agreement."

On July 30, 1996, Cannon purchased a used automobile from Cherry
Hill Toyota. In addition to the vehicle, Cannon purchased,
through Cherry Hill Toyota, an optional mechanical breakdown
protection (MBP) package from Interstate, Inc. Cannon financed
the entire transaction through Cherry Hill Toyota. The
transaction was memorialized in a retail sales installment
contract, which reflects a charge of $1,167.21 for the MBP in a
section titled "Amounts Paid to Others On Your Behalf."

On July 29, 1997, Cannon commenced this case by filing a
putative class-action complaint. Cannon alleges that Cherry Hill
Toyota's representation in the "Amounts Paid to Others On Your
Behalf" section of the retail sales installment contract that it
paid $1,167.21 to Interstate, Inc. for MBP on her behalf was
false and misleading because Cherry Hill Toyota retained a
portion of that amount for itself without disclosing to Cannon
that it was doing so.

Cannon claims that Cherry Hill Toyota's failure to disclose that
it was adding a markup or surcharge to the actual cost of the
service warranty Cherry Hill Toyota purchased for her from
Interstate and its affirmative misrepresentation of the amount
actually paid to Interstate on the retail sales installment
contract violates the Truth in Lending Act (TILA), 15 U.S.C.
1601, and the New Jersey Consumer Fraud Act.

Cherry Hill Toyota sold extended warranties on credit to 384
consumers in the one-year period preceding the Cannon
transaction on July 30, 1996. Extrapolating that number over the
six-year period covered by the applicable statute of
limitations, and assuming that Cherry Hill Toyota's sales
practices were relatively consistent throughout those years,
Cannon estimates that there are approximately 2,300 consumers
who have claims virtually identical to hers under the New Jersey
Consumer Fraud Act. Because joinder of 2,300 plaintiffs
certainly would be impracticable, the court found that the
action met the numerosity requirement of Rule 23(a)(1).

Cherry Hill Toyota argues that Cannon cannot satisfy the
typicality requirement because she has asserted an individual
claim under New Jersey's Consumer Fraud Act (count three) in
addition to those claims for which she seeks class certification
(counts one and two).

The fact that Cannon has an additional individual claim against
Cherry Hill Toyota does not detract from her ability to fairly
represent the interests of absent class members. Indeed,
Cannon's interests are perfectly aligned with those of the
absent class members on each of the claims for which she seeks
to represent a class. Accordingly, the court found that Cannon
has satisfied the typicality requirement of Rule 23(a)(3).

Rule 23(a)(4) requires that the representative parties "fairly
and adequately protect the interests of the class." This
standard is satisfied, notwithstanding Cherry Hill Toyota's
contention that Cannon lacks sufficient understanding of the
factual and legal bases of her claims to adequately represent a
class. The fact that Cannon has not studied the TILA or the New
Jersey Consumer Fraud Act is completely irrelevant; she has
counsel who are intimately familiar with both statutes. As a
layperson, Cannon should not be expected to have a detailed
understanding of the statutes under which she has brought suit
or of precisely how Cherry Hill Toyota has allegedly violated
those statutes. Cannon is entitled to rely on the knowledge and
experience of her counsel.

In addition to satisfying the requirements of Rule 23(a), a
plaintiff who seeks class certification under Rule 23(b)(3) must
demonstrate that "questions of law or fact common to members of
the class predominate over any questions affecting only
individual members predominance , and that a class action is
superior to other available methods for the fair and efficient
adjudication of the controversy superiority ." Fed. R. Civ. P.
23(b)(3).

Common issues of law and fact clearly predominate. This case
involves alleged affirmative misrepresentations of amounts paid
to third parties by Cherry Hill Toyota on behalf of class
members for MBP on standardized retail sales installment
contracts used by Cherry Hill Toyota since July 1991, in
violation of the TILA and the New Jersey Consumer Fraud Act.
These allegations present common questions of law and fact.
Indeed, there do not appear to be any individual questions of
law or fact other than the precise amount of damage suffered by
each individual class member.

Rule 23(b)(3) provides four non-exclusive factors to guide the
determination of whether a class action is superior to other
available methods of fairly and efficiently adjudicating a
controversy.

Here, each of these factors favors class certification. First,
the individual members of the proposed class would appear to
have little interest in pursuing individual claims against
Cherry Hill Toyota. Second, there is no other litigation against
Cherry Hill Toyota by potential class members in this or any
other forum. Third, it is desirable to litigate similar, related
claims in one forum. Finally, the court anticipates no
particular management difficulties in this case.

Accordingly, the Court granted Cannon's motion for class
certification. (New Jersey Law Journal; May 31, 1999)


FIRST UNION: Investors Complain About CoreStates Takeover Losses
----------------------------------------------------------------
The St. Petersburg Times reports that a class-action lawsuit
against First Union Corp. charges the company with artificially
inflating its stock price by covering up problems with its
troubled takeover of Philadelphia's CoreStates Financial Corp.
The suit was filed in federal court in Charlotte, N.C., on
behalf of investors who bought the stock after First Union paid
a record $19.8-billion for CoreStates last year.

The bank's stock has lost more than one-third of its value since
January, erasing $20-billion in equity held by investors. First
Union officials declined to comment. (St. Petersburg Times;
06/10/99)

According to the Greensboro News & Record, the lawsuit comes
after a steep decline in the company's stock price.

"The matter is in litigation. We're reviewing the situation,"
spokeswoman Ginny Mackin told the Greensboro News & Record.
Company officials said they could not recall a similar suit in
First Union's history.

The suit alleges that First Union said the CoreStates deal and
other initiatives were going smoothly and that profits were up -
at a time when profits were actually sliding because of
"mounting managerial problems," "low morale" due to mass
layoffs, and the fact that "customers were leaving the bank in
droves, contrary to the Company's statements emphasizing its
strong customer retention rates."

According to the suit, First Union's overly rosy scenario had
the effect of attracting new investors and temporarily boosting
its stock price - enabling it to conclude further acquisitions,
including The Money Store and a North Carolina investment bank
formerly owned by Erskine Bowles, President Clinton's former
chief of staff.

The suit describes a series of admissions by First Union
management, starting in January, that the bank has failed to
meet its goal of boosting sales and profits while firing almost
half the CoreStates work force and shutting or selling hundreds
of bank offices.

Since January, the CoreStates shortfall and other disappointing
news has shaken investors' confidence in the Charlotte giant,
making it the butt of ridicule by Wall Street analysts and rival
bankers.

The bank has lost $20 billion in equity held by mutual funds and
other investors, at a time when other major bank stocks have
been rising. While First Union Chairman Edward Crutchfield Jr.
swore off further bank acquisitions and promised to unveil a new
Internet banking strategy last month, the stock has continued to
sink. It fell another 88 cents Wednesday to close at $43.38, its
lowest since March 1997.

The lawsuit charges that Crutchfield, company president John
Georgius and controller James Hatch "knew or recklessly
disregarded" the fact that they would fail to meet their stated
goals for CoreStates and other First Union initiatives. Instead,
the suit alleges, the trio led investors astray by issuing a
series of "false and misleading statements" about the progress
of the CoreStates deal in quarterly filings with the Securities
and Exchange Commission, in meetings with Wall Street stock
analysts, and in interviews with news media. The suit also
alleges that Georgius profited personally from his role in
suppressing the bad news. Citing SEC records, the suit details
$8 million worth of stock Georgius sold at attractive prices in
the three months before the bank began acknowledging its
problems in January.

Attorneys filing the suit include Milberg Weiss Bershad Hynes &
Lerach of New York and Boca Raton, Fla.; Brown & Associates of
Charlotte; the Pittsburgh law offices of Alfred G. Yates Jr.;
Schiffrin & Barroway of Bala Cynwyd, Pa.; and Spector & Roseman
of Philadelphia. (Greensboro News & Record; 06/10/99)


FLORIDA PANTHERS: Plaintiffs Miss Deadline to Amend Complaint
-------------------------------------------------------------
Florida Panthers Holdings has received two favorable decisions
in lawsuits related to its purchase of Hyatt Regency Pier 66
Hotel and the Bahia Mar Resort and Yachting Center in December
1996.

U.S. District Court Judge Daniel T.K. Hurley heard oral
arguments on May 5 and granted the company's motion to dismiss a
class-action complaint on May 24 in Susser vs. Florida Panthers
Holdings Inc. The judge allowed Susser to file an amended
complaint for one claim. However, the 10-day filing deadline has
expired.

Also, Broward Circuit Judge W. Herbert Moriarty granted the
company's motion to dismiss three derivative claims brought by
shareholders on behalf of the Panthers on June 3, 1999, in
Kalishman vs. Huizenga. The dismissal came after an independent
counsel conducted 20 depositions, extensive discovery and issued
a report to the board.

In dismissing the derivative claims in Kalishman vs. Huizenga,
the court stated the transaction in which the Panthers bought
the Pier 66 and Bahia Mar hotels was fair to the Panthers and
its shareholders. Richard Handley, general counsel to Florida
Panthers, said the company intends to seek recovery of legal
fees.

Florida Panthers Holdings owns luxury resort properties in
Florida and Arizona. (THE MIAMI HERALD; June 10, 1999)


POLAROID CORP.: Shareholders Complain About False Statements
------------------------------------------------------------
A shareholder lawsuit was filed against Polaroid Corp. alleging
the company violated securities laws. The suit seeks class-
action status.

Attorneys for shareholders who bought Polaroid common shares
between April 16, 1997 and Aug. 28, 1998 said the complaint
alleges Polaroid issued materially false and misleading
statements about its operations and operating results, which
caused the price of Polaroid common shares to be artificially
inflated.

NYSE-listed shares of Polaroid fell 9/16 to 20 11/16. (The
Boston Globe; June 10, 1999)


PRESCRIPTION DRUG LITIGATION: Pharmacies Push HMO Discount Claim
----------------------------------------------------------------
Attorneys representing the nation's 40,000 retail pharmacies are
set to ask the 7th U.S. Circuit Court of Appeals to reinstate a
class-action lawsuit contending that drug companies conspired to
deny them discounts offered to health maintenance organizations,
hospitals and mail-order drug firms.

In oral arguments set for 9:30 a.m. Wednesday, the pharmacies
will argue that U.S. District Judge Charles P. Kocoras erred in
granting summary judgment to the drug companies in November.

Kocoras failed to consider how the conspiracy spread throughout
the industry, how the conspiracy led to a system of economic
price discrimination that has prevailed throughout the market
for more than a decade, and how the members of the conspiracy
joined together to create an industry-wide chargeback system to
prevent destruction of their system of economic price
discrimination," the pharmacies said in their appeals court
brief.

The appeal stems from a handful of class-action lawsuits filed
more than five years ago that eventually were consolidated for
trial in the Northern District of Illinois last year. The
plaintiffs, which include corner drugstores and large chains
such as Deerfield-based Walgreens Co., alleged the drug
companies' actions primarily constituted a violation of the
Sherman Act. The defendants, which include six drug wholesalers
and five drug manufacturers, deny any wrongdoing.

In their appeals brief, the pharmacies argued that Kocoras erred
in barring testimony from a drug company executive alleging that
private meetings took place in which the companies agreed to
offer lower prices to the hospitals and health care companies,
but not the pharmacies. The pharmacies also challenged Kocoras'
decision to ignore expert testimony they said showed the drug
companies' motives for giving discounts to some, but not all,
vendors.

The economic evidence from the record -- evidence that
defendants engaged in nominal pricing to hospital patients in
order to capture the supra-competitive profits being generated
as a result of the conspiracy on sales to the same patients
after they leave the hospital, evidence of the pattern of price
increases in the market, and evidence of the prices charged for
these same drugs in foreign markets -- all would have supported
the same conclusion," the brief said. There was no proper basis
for excluding any of this evidence."

George L. Saunders Jr. of Saunders & Monroe in Chicago will
argue on behalf of the pharmacies Wednesday. J. Thomas Rosch of
Latham & Watkins LLP in San Francisco and William F. Cavanaugh
Jr. of Patterson, Belknap, Webb & Tyler in New York will split
time for the drug companies.

Among the defendants in the original suit were Skokie-based G.D.
Searle & Co. and North Chicago-based Abbott Laboratories, but
Abbott and a handful of other drug companies settled with the
pharmacies in July for more than $ 700 million.

The 7th Circuit case is In re Brand Name Prescription Drugs
Antitrust Litigation, No. 99-1167. (Chicago Daily Law Bulletin;
June 8, 1999)


PRISON REALTY: Abbey Gardy Files Complaint in Tennessee
-------------------------------------------------------
Abbey, Gardy & Squitieri, LLP filed a securities class action
lawsuit on behalf of stockholders of the common stock of Prison
Realty Trust, Inc. (NYSE: PZN), in the United States District
Court for the Middle District of Tennessee. Plaintiff seeks to
recover damages on behalf of (1) all persons whose shares were
converted into Prison Realty common stock in connection with the
merger of Prison Realty and Corrections Corporation of America
("CCA") on December 31, 1998 and (2) all persons who purchased
or otherwise acquired Prison Realty common stock between January
1, 1999 and May 14, 1999.

The complaint charges Prison Realty and certain of its officers
and directors with violations of Sections 11, 12(a) and 15 of
the Securities Act of 1933 and Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 1Ob-5. The complaint
alleges that the defendants failed to disclose that it would
have to pay substantially higher management fees to CCA for the
operation and development of new prisons so that investors would
approve the merger of the two companies. On May 14, 1999, Prison
Realty disclosed that it would retroactively increase the
management fees paid to CCA by approximately $80 million. In
response, the price of Prison Realty's common stock plunged from
$19-3/4 on Friday May 14, 1999 to close at $13-3/8 on May 18,
1999.

To learn more, contact Joshua M. Lifshitz, Esq. at 800-889-3701
or 212-379-2418 or at jlifshitz@a-g-s.com via email.


PRUDENTIAL INSURANCE: FL Law Precluding Punitives Doesn't Apply
---------------------------------------------------------------
In an order filed May 18, 1999, U.S. Dist. Ct. Judge Wolin,
grated the Plaintiffs in the case In re: The Prudential Ins.
Co., etc., leave to amend their complaints to include
allegations for punitive damages. Punitive damages are available
in the District Court but were previously unavailable to the
Plaintiffs under Florida law when their state cases were filed,
before removal and transfer to the District Court by the
Multidistrict Litigation Panel.

The judge ruled that the Florida statute precluding the punitive
damage claim does not apply in this federal diversity action.

Earlier, on May 3, 1999, the court denied the motion of
petitioner Chionchio for an extension of time to opt out of the
class and granted Prudential's motion to enforce the final order
and judgment against Mr. Chionchio, prohibiting him from
proceeding with an independent action outside the class
settlement process.

Similarly, on May 6, 1999, the court granted Prudential's motion
to enforce the final order and judgment against a Mr. Cherry,
prohibiting him from proceeding with an independent action
outside the class settlement process. (New Jersey Law Journal;
May 31, 1999)


RAY SCOTT: Judge Finds Nothing Fishy with Founder of BASS Inc.
--------------------------------------------------------------
A federal judge in Montgomery has dismissed a class-action
lawsuit against BASS Inc. founder Ray Scott and the group that
purchased the company from him, saying the plaintiff failed to
prove it was initially formed as a nonprofit organization.

U.S. District Judge Ira DeMent, in a ruling issued Tuesday,
threw out the 1992 class-action suit filed by Bradley Murray of
Wichita, Kan., with prejudice. That means it cannot be filed
again.

Murray was seeking more than $75 million in actual damages plus
punitive awards for himself and about 500,000 other current
members of BASS.

Murray contended Scott founded BASS, which stands for Bass
Anglers Sportsman Society, in 1969 as a nonprofit. Murray joined
BASS in 1982.

In the suit, Murray accused Scott and BASS officials of fraud,
hiding material facts from members and diverting funds away from
the association for personal use and benefit. (The Atlanta
Journal and Constitution; June 10, 1999)


SOUTHWIN INC.: FL Homeowners Awarded $5.2 Million from Developer
----------------------------------------------------------------
When it rains, Florida City homeowners Peter and Alex Bovard
need all the help they can get: Their house leaks, it has
mildewed door frames and stained walls, and the place never
feels completely dry. "I have to put towels on the floor and
plastic covers on my furniture. I have to leave them in place
because it often rains while we're away," Alex Bovard said.

Help finally arrived Friday.

That's when the Bovards and 168 other homeowners in the Villages
of Palm Bay Homes development won the class action lawsuit they
filed in 1996 against their home builders. A jury in the 11th
Judicial Circuit Court in Miami-Dade County awarded the group
$5.2 million in damages from developer Southwin Inc. and
contractor Tripp Construction Inc.

"I knew my rights were violated, but the only way to prove it
was by going to court," Alex Bovard said. "We tried contacting
[Southwin] many times, but they didn't want to listen to us. We
realized it wasn't just my problem, it's a community problem."

The Bovards' home and 66 others were built in 1993 and 1994.
They were advertised as affordable post-Hurricane Andrew
housing, said Ervin Gonzalez, an attorney for the homeowners.

"But these homes were replete with building code violations,"
Gonzalez said. "They did not have braced roof trusses, the wood
was not pressure-treated or bolted to the foundation, the stucco
had huge cracks. No construction plans of these homes were ever
found, and no permits should have ever been issued."

The judgment should mean payments of $50,000 to $70,000 for each
household, depending on individual house models. But a lawyer
representing Southwin said the defendants are keeping all their
options open, including appeals and bankruptcy. "Three weeks ago
we filed an 'open checkbook' settlement offer," attorney Robert
Hustead said, "where an independent engineer and contractor
determine what repairs are needed, and whatever it takes to fix
things, we were willing to pay that. And that was rejected
because the plaintiffs want cash. I'm sure some of the things
they complained about are present in some of the houses, but not
all of the houses had all of the problems."

Gonzalez countered that the homes would only stand 10 years on
average regardless of what repairs were made, compared to a 30-
or 40-year life expectancy for a properly built new home. "Those
repairs would only be a patch job," he said. "If you cost
someone their new car, you don't offer them a wrecked car and
call it even."

For the Bovards, the judgment will allow them to start over on
the house -- then sell it and move somewhere else. "I feel that
we received justice," Alex Bovard said. "It was the right thing
to do in suing the company." (The Herald; FLORIDA CITY)


VITAMIN LITIGATION: Class Settlement Talks Around $800 Million
--------------------------------------------------------------
Bloomberg News reported Wednesday that Roche Holding, BASF AG
and Rhone-Poulenc are negotiating a settlement to resolve U.S.
class-action lawsuits accusing the drugmakers of fixing vitamin
prices. According to the report, settlement amounts of as much
as $800 million are being considered.

According to the Agence France Presse, Roche announced on
Thursday that it is negotiating with plaintiffs who have brought
class action suits after it was found guilty of running a
vitamin price-fixing cartel. A Roche spokesperson declined to
comment on the amount of any potential legal settlement.

Rumors in the market suggest that Roche would be willing to pay
500 million dollars (480.7 million euros) to settle the suits
brought by American buyers of its vitamins. Any legal payments
would be in addition to the half billion dollars Roche was fined
by the US Justice Department in May for fixing vitamin prices
and market share, following a secret US government probe of the
vitamin industry.

A German firm, BASF Aktiengesellschaft has also been fined 225
million dollars for its involvement in the scandal.

The two companies were accused of holding regular meetings and
conversations from January 1990 to February 1999 to agree on
prices and on how the international vitamin market was to be
divided among them. The conspiracy, according to the department,
drove up the prices of vitamins A, B2, B5, C, E, and Beta
Carotene, along with vitamin premixes used to enrich breakfast
cereals and other processed foods.

The European Union has launched an official investigation into
the affair.

Roche director general Franz Humer said last month the fine
would be taken as a one-time special charge against earnings for
the first half of 1999. Roche spokesman Peter Wullschleger said
recently that media reports on potential legal liabilities were
"pure speculation."

"The total will include the fine, the law suit amounts and a
possible fine from the EU," Wullschleger said. (Agence France
Presse; June 10, 1999)


WWII REPARATIONS: German Companies Provide Funds for Slave Labor
----------------------------------------------------------------
After months of negotiations, 16 German companies that profited
from Nazi-era slave labor announced details of a promised
compensation fund Thursday, including provisions that drew
immediate fury from victims' groups.

DaimlerChrysler, Bayer and other major industrial concerns had
previously agreed to establish the fund with a declared goal of
quashing class-action suits filed in the United States on behalf
of hundreds of thousands of people forced to work for the Nazi
war machine.

Lump-sum payments would be based partly on need and only to
victims who were slave laborers for six months or longer, the
companies announced Thursday. Average pensions and cost of
living in a claimant's home country would determine the amount,
meaning that victims in poorer eastern European countries would
get less than those in the United States, Canada and other
western nations.

When the payments would start and the fund's total value will be
decided in the coming weeks in meetings with U.S. and German
government representatives, providing there are guarantees that
lawsuits will be dropped, said Manfred Gentz, a representative
of DaimlerChrysler.

But almost immediately after news of the fund surfaced, lawyers
in the suits said they were determined to press on with their
legal action.

German attorney Michael Witti, who works in connection with
U.S.-based lawyer Ed Fagan, said he was particularly dismayed by
the six-month clause. Victims from Hungary are immediately
excluded, he said, because Nazi transports from that country did
not begin until late in the war.

"They misunderstand how serious this is," Witti said. "There is
no single intention of dropping the lawsuits."

He and others representing former slave laborers complained that
the details announced Thursday were not agreed to in ongoing
negotiations among industry, government and victims groups about
how to settle compensation claims.

The New York-based Conference on Jewish Material Claims against
Germany rejected the proposed fund in a statement, saying: "We
object to the notion that slave laborers would be placed on an
inverted hierarchy. Survival was a miracle and this ... would
penalize those who managed to escape the Nazis' murderous
methods."

In announcing the fund, industry representatives said Chancellor
Gerhard Schroeder's chief of staff, Bodo Hombach, helped draft
the proposal and approved it two days ago.

Hombach has been holding negotiations for months with Jewish
representatives and government officials from the United States,
Israel and former Eastern Bloc nations.

Faced with the growing lawsuits, industrial groups agreed in
principle last fall to compensate victims after years of
insisting that German government should settle Nazi-era claims.
The government had argued that the individual companies were
responsible.

People whose property was destroyed during the Holocaust to the
benefit of German industry also can receive compensation,
although the fund does not cover slave laborers who were
prisoners of war or who worked in agriculture or for
municipalities.

To administer the fund, with help from the government, the 16
companies said they were establishing a foundation,
"Remembrance, Responsibility and the Future."

Also participating in the fund are: Allianz, BASF, BMW, Deutsche
Bank, Degussa-Huels, Dresdner Bank, Thyssen-Krupp, Hoechst,
Siemens, Volkswagen, RAG, Deutz, VEBA and Commerzbank. The newly
merged DaimlerChrysler will settle on behalf of Daimler-Benz.
(AP Worldstream; June 10, 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

Class Action Reporter is a daily newsletter, co-published by
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Copyright 1999. All rights reserved. ISSN 1525-2272.

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