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              Wednesday, June 16, 1999, Vol. 1, No. 94


BLECH & CO.: Court Identifies Three Subclasses in Biotech Fraud
DENTSPLY INTERNATIONAL: Dentist's Complaint Goes to Delaware
FEDERAL TAXES: Tenn. Lt. Gov. Talks Taxes, Lawsuits & Revolution
KENTUCKY PRISONS: Jefferson County Settles Strip-Search Case
LUEN THAI: Shows the Good a $1 Billion Class Action Suit Can Do

MCI WORLDCOM: Landowners Object to Railroad Easement Optic Cable
MEMORIAM: Harold Kohn, "Architect" of Class Actions, Dies at 85
NEW JERSEY: Confused by Abortion, Women Sue State to Sue Doctors
NORTHWEST AIRLINES: January Blizzard Suit Certification Friday
OXFORD HEALTH: Judge Refuses to Dismiss Shareholders NY Suit

P&O HOLIDAYS: Cruise Passengers Sue Down Under Over Typhoid
POLAROID CORPORATION: Milberg Weiss Files Suit in Massachusetts
PREMIERE TECHNOLOGIES: Xpedite Systems Suits Consolidated in GA
PRISON REALTY: Pomerantz Haudek Files Complaint in Tennessee
PRISONER RIGHTS: Concern Grows About Using Electronic Stun Belts

SELECT COMFORT: Lockridge Grindal Files Complaint in Minnesota
SELECT COMFORT: Wolf Popper Files Complaint in Minnesota
U.S. BANCORP: Eckart Firm Says Bank Sold Confidential Information
U.S. BANCORP: Wolf Popper Charges Bank Sold Customer Information
US DOE: Provides Medical Coverage for Ohio Nuclear Plant Workers

WEST PUBLISHING: Worker Stock Sex Discrimination Class Certified
Y2K LITIGATION: NY Law Journal Files Report on Current Cases


BLECH & CO.: Court Identifies Three Subclasses in Biotech Fraud
Some 17 Plaintiffs, who had bought securities of 22
biotechnology companies in either the primary or secondary
market, sued for fraud. Defendants included Blech & Co., a
registered broker-dealer, and Bear Stearns. Allegedly,
defendants engaged in a scheme to inflate the prices of Blech
securities. Plaintiffs moved for class certification.

Bear Stearns argued that there were actually two distinct
schemes -- one involving unauthorized trades and sham
transactions affecting the secondary market, and the other, a
"gifting scheme."

Granting the motion, the U.S. Dist. Ct. (S.D.N.Y.) court
delineated three subclasses: those involved in the securities in
the primary market, those in the secondary market and a
secondary market subclass for the period when Bear Stearns
became a market maker. (New York Law Journal; May 27, 1999)

DENTSPLY INTERNATIONAL: Dentist's Complaint Goes to Delaware
A dentist brought an antitrust action in New York Supreme Court
on behalf of himself and a class of others who purchased false
teeth manufactured by DENTSPLY INTERNATIONAL , INC.

The Defendant removed the suit to the U.S. Dist. Ct. (S.D.N.Y.),
and plaintiff moved to transfer venue to the Middle District of
Pennsylvania. The Defendant cross-moved to transfer venue to the
District of Delaware, arguing that there were two other actions
pending against it in that district, each of which involved
allegations virtually identical to those raised in the instant

The court found that the existence of two pending related
actions was compelling justification for transferring venue to
Delaware. It also noted that the convenience of the parties was
inconclusive and that the operative facts occurred throughout
the United States. (New York Law Journal; June 1, 1999)

FEDERAL TAXES: Tenn. Lt. Gov. Talks Taxes, Lawsuits & Revolution
Lt. Gov. John Wilder wants to sue the federal government,
contending Tennesseans are victims of discrimination because
they pay no state income tax. Since 1986, state sales tax
payments cannot be deducted from federal income tax payments.
State income taxes are deductible from the federal income tax.
Tennessee imposes a state and local sales tax on most items,
including food, but -- unlike most other states -- has no
general state income tax. Thus, Wilder says, Tennesseans cannot
deduct their tax payments to state government while people in
other states can. That's unfair, he says, and he's contemplating
a lawsuit to see if the courts agree.

Most states, of course, have an income tax, and their citizens
are able to deduct state income tax payments on itemized federal
income tax returns. Though there is dispute in legal circles,
some believe that Tennessee's state constitution prohibits an
income tax, Wilder noted. And that means Tennesseans do not
receive equal treatment because of their state constitution.

The result is a situation in which citizens of Kentucky "get a
30 percent- plus kickback on their federal income taxes and they
didn't give Tennessee anything," Wilder said. Dollars that go to
pay state sales taxes, he says, are effectively taxed again when
the federal income taxes are applied.

"Many years ago we had a war 'cause we had taxation without
representation," he said in an interview. "What we got now is
that Uncle Sam taxes our taxes. He used to let us deduct the
gasoline tax. Now he doesn't. He taxes taxes. I think that's a
good class-action (lawsuit). I think it discriminates against
people in Tennessee." Wilder, himself an attorney, said he's
been talking up his idea with "some of the smartest lawyers in
the state of Tennessee." There is some question, he said, about
whether he would have legal "standing" to file such a lawsuit,
but he is still looking for a valid route into the courtroom.
(Knoxville News Sentinel; 06/07/99)

KENTUCKY PRISONS: Jefferson County Settles Strip-Search Case
A judge in Louisville, Kentucky, has approved an $11.5-million
settlement for about 1,000 people who were illegally strip-
searched at the Jefferson County jail. The settlements range
from less than $1,000 for male plaintiffs in the class action to
up to $4,000 for female plaintiffs. (THE LAWYERS WEEKLY; June
18, 1999)

LUEN THAI: Shows the Good a $1 Billion Class Action Suit Can Do
Hong Kong-based garment-manufacturer Luen Thai International,
whose Saipan factories were named in a US $1 billion class
action earlier this year for mistreating workers, announced that
its factories in Hong Kong, the Philippines and Saipan had been
certified as complying with international quality management

The company said the certifications were issued by Geneva-based
Societe Generale de Surveillance in the first quarter of this
year to its Hong Kong headquarters, its three factories on
Saipan and its Philippines subsidiary and its six manufacturing
affiliates. Luen Thai is controlled by Willie Tan Wai-li. (South
China Morning Post; June 15, 1999)

MCI WORLDCOM: Landowners Object to Railroad Easement Optic Cable
Telecommunications companies ignored the property rights of
landowners in burying conduits for fiber optic cable, according
to a class action complaint filed in Philadelphia Common Pleas
Court last week. Without notifying plaintiffs, the defendants
reached agreements with railroads to use their right-of-way
easements in order to lay the fiber optic cable, which can carry
television, telephone and computer modem signals, lawyers for
the property owners alleged in a 10-page complaint.

The railroads were paid a "substantial amount" for use of the
rights of way, said the plaintiffs' lawyer, Michael D. Donovan
of the Donovan Miller law firm. "The rate paid for licenses [to
lay fiber optic lines] in other cases has been $ 10,000 per
mile," he said. The representative party in Irving v. WilTel
Communications has less than a mile of affected property,
bisecting a cemetery he owns in Chester Township, Delaware
County. But in Pennsylvania, there are at least 1,000 affected
property owners, Donovan estimated.

Defendants in the case are WilTel Communications of Houston,
which has a local address at 2301 Market St., and MCI WorldCom
Inc. of Jackson, Miss. Messages seeking comment were left with
the media relations departments of both companies, but weren't
immediately answered.

The railroads and the fiber optic companies were wrong, the
complaint alleges, to sell the right to lay the cable without
compensating the landowners. Along with the fiber optic cables,
the telecommunications companies placed warning poles marking
the line and other related hardware, the complaint states." The
right of way easements of the railroads ... are limited
exclusively for purposes necessary to the operation of a
railroad, and the laying ... of cable [does] not constitute such
a purpose," the complaint states. "The railroads had no right by
which they could allow defendants to lay, operate and maintain
cable without providing compensation to landowners." The key
issue in the case will be whether the railroads were justified
in selling licenses to use their rights of way for a purpose
other than running trains over track.

Donovan said he expects the defendants to press for a broad
interpretation of the right-of-way language, one that would
allow the use of the easements for the corporate purposes of the
railroad company. But plaintiffs' counsel added that a broad
interpretation would not be correct. Interpretation of the right
of way "is going to be the common question [in the class
action]," Donovan said. "The right of way is defined as being
for the purpose of a railroad, not for the business purposes of
the railroad's corporate owners. Otherwise, it is not a right of
way at all; it is basically a sale."

One of the hurdles in the lawsuit will be to identify the
successor of the railroad companies that sold licenses to the
fiber optic companies. With the recent merger of CSX, Conrail
and other railroads, and the exchanges of rail lines among them,
it will take discovery to name the party involved in the deals
with WilTel and MCI, Donovan said. No railroad was sued in the
complaint, Donovan said. But, during the litigation, liability
issues may surface regarding the railroad's conduct in selling
the licenses.

The class action against the two telecommunications firms has
been scheduled for a status conference before Common Pleas Court
Judge Stephen E. Levin on July 14.State courts in Indiana and
Tennessee have previously certified class actions on behalf of
property owners who have had fiber optic lines buried under
their land based on acquisition of railroad rights of way. The
Indiana case, against AT&T, has been partially settled, Donovan
said. (The Legal Intelligencer; June 11, 1999)

MEMORIAM: Harold Kohn, "Architect" of Class Actions, Dies at 85
Harold E. Kohn, who has been described as one of the architects
of modern class-action litigation, died on June 14, 1999 in
Philadelphia. The founding partner of Kohn Swift & Graf was 85
years old. Mr. Kohn was nationally known for his role in the
development of contemporary practice for multi-district
litigation in federal courts.

Retired 3rd Circuit Court of Appeals Judge Arlin M. Adams, now
of Schnader Harrison Segal & Lewis, said Mr. Kohn "did more to
develop the class action device than probably any other lawyer
in the country." Adams, who often appeared as Mr. Kohn's
opposite in court, described him as "very fair and I was on the
other side."

Mr. Kohn, the son of Jewish immigrants from Russia, was born in
1914 in the apartment above his family's store. He graduated
from Frankford High School as valedictorian of his class and
earned his bachelor's degree from the University of
Pennsylvania. In 1937, he graduated first in his class from the
University of Pennsylvania Law School, where he was editor of
the Law Review. He began his legal career as a judicial clerk
for Judges Curtis Bok, Gerald F. Flood and Louis Leventhal in
the highly regarded "C.P. 6," described by Adams as "the best
trial court in the United States at that time." In 1939, he
joined Murdoch Paxson Kalish & Green, which later became
Dilworth Paxson Kalish Kohn & Dilks. In 1952 Mayor Joseph Sill
Clark appointed Mr. Kohn special counsel to the City of
Philadelphia on transit matters. At the time, transit was
provided by private companies, and Mr. Kohn spearheaded efforts
to create the public transit system that became SEPTA. In the
1940s and '50s, Mr. Kohn established a reputation as a business
trial lawyer who would take and win difficult cases. He handled
libel, trademark, antitrust, transit, constitutional and zoning
litigation, while also practicing labor and business law. He was
the lawyer for Walter Annenberg's publishing empire in
copyright, libel and First Amendment litigation.

But it was in antitrust litigation that Mr. Kohn began to
develop a national reputation. He won landmark cases for
independent motion picture exhibitors against the film studios,
cases which, according to Cohen, "opened up the whole field" of
antitrust class actions. Mr. Kohn, he said "was really the
generator of that type of action." Mr. Kohn became a central
figure in the field of major antitrust litigation in the early
1960s when he represented public utilities in the first civil
case to be brought against General Electric, Westinghouse and
other manufacturers of electrical equipment over a massive
price-fixing conspiracy that had been uncovered by the
Department of Justice. The government's indictments resulted in
hundreds of civil cases, of which only four went to trial.

The jury verdict Mr. Kohn won for Philadelphia utility companies
$29 million after trebling sent shock waves through the
profession. Judge Dolores K. Sloviter of the U.S. Court of
Appeals for the 3rd Circuit, who was an associate working under
Mr. Kohn during the electrical equipment litigation, said he was
"very innovative. He developed what has since evolved as the
plaintiff's approach in that kind of litigation."

The massive scale of the electrical equipment litigation made it
a watershed, and the actions led to major changes in the
practice for handling multiple related cases in federal courts.
Mr. Kohn helped draft the modern amendments to the class action
rule and the law establishing the Panel for Multi-District
Litigation, and he was in the vanguard of implementing the
practical procedures which gave life to these changes in law.

Attorney John G. Harkins Jr., of Harkins & Cunningham, helped
defend Westinghouse as an associate at Pepper Hamilton during
the electrical equipment litigation, which, he said, "marked the
beginning of industry-wide antitrust litigation." The field was
"a whole new area of endeavor," Harkins said, describing Kohn as
"certainly the leader of that bar."

For the next 30 years, Mr. Kohn was a central figure in most of
the nationwide antitrust price-fixing cases, including cases
involving plumbing fixtures, antibiotics, paper and timber
products, sugar and agricultural products. In 1982 he tried a
class action against the timber industry and won a $2 billion
jury verdict, the largest ever at that time.

In 1969, Mr. Kohn left the Dilworth firm and founded the firm
that would eventually become Kohn Swift & Graf. He remained
active, trying cases into his late 70s and arguing appeals into
his 80s, and he was at the office every day until he suffered a
hip fracture at age 83, after which his health began to decline.
Last year, he became special counsel to the firm. (The Legal
Intelligencer; June 15, 1999)

NEW JERSEY: Confused by Abortion, Women Sue State to Sue Doctors
The Associated Press reports that in a new challenge to Roe vs.
Wade, three women who had abortions in New Jersey are suing the
state for the right to sue the doctors who terminated their
pregnancies. The women say the doctors did not obtain their
fully informed consent before the abortions. Their federal
class-action lawsuit challenges the constitutionality of a New
Jersey law prohibiting wrongful-death lawsuits when the victim
is an unborn child.

"These women were not given any meaningful information to make a
rational, reasoned decision about the most important thing they
were ever going to decide in their lives," said New Jersey
attorney Harold Cassidy. Cassidy is representing the three women
plus two female obstetricians who say New Jersey abortion laws
violate the rights of mothers and children.

He said the complaint, filed Thursday in U.S. District Court in
Trenton, names as defendants Governor Whitman, the Attorney
General's Office, and the state Board of Medical Examiners.

Cassidy, who successfully argued against surrogate parenting
contracts in the 1987 "Baby M" case, scheduled a news conference
in Washington to detail the case.

The three plaintiffs who had abortions are using pseudonyms for
now. One of them, "Donna Saint Maria," became pregnant at 16 and
wanted to have the baby but went to an abortion clinic in
another state at the behest of her parents, according to a
synopsis provided by Cassidy. When she wrote on a consent form
that her parents were forcing her to have the abortion, the
clinic turned her away. Back in New Jersey, her parents forced
her to go to another clinic. She was not asked any questions to
determine whether the abortion was voluntary, and the procedure
was performed. The second woman, "Mary Doe," was married when
she became pregnant. Cassidy's summary says the woman asked her
doctor "whether she was already carrying an existing human
being," and decided to have an abortion when the doctor said no.
"Had she known the true facts she would not have consented to
terminate the life of her own child," the summary says. The
third woman, "Jane Jones," was 16 when she had an abortion in
Mercer County. She later sued the doctor, saying he failed to
inform her she was carrying "an existing human being."

Jones sued the doctor in state Superior Court; the doctor moved
to dismiss the lawsuit citing Roe vs. Wade, the 1973 U.S.
Supreme Court ruling establishing the right to abortion. The
Superior Court judge agreed to hold the case to let Jones
explore her rights in the federal court system.

That led to Cassidy's involvement, and the formation of the
class-action lawsuit. Cassidy said his lawsuit includes
testimony from "world-class doctors... establishing conclusively
that this is a human being throughout conception." Cassidy said
the lawsuit will mark the first time that women, rather than
doctors, step forward to challenge abortion laws. If they
succeed, he said, "the essential assumptions of Roe vs. Wade
would be reversed."

"The Constitution cannot protect the fundamental right the
mother has in a relationship, and protect her ability to have an
informed waiver of that right, and also protect destroying that
right through abortion," Cassidy said.

A spokesman for Whitman said the state does not comment on
lawsuits as a matter of policy.

Cassidy fought, and lost, a similar case against New Jersey.
(The Record (Bergen County, NJ); June 11, 1999)

NORTHWEST AIRLINES: January Blizzard Suit Certification Friday
While a blizzard kept her plane stranded for more than six hours
on the tarmac at Detroit's Metro Airport in January, Northwest
passenger Marti Sousanis sat and wept in her seat. Flight
attendants, she said, told her that despite her chronic back
pain, if she stood up she could be arrested. Ms. Sousanis was
among passengers stranded in Detroit on Jan. 2 when a blizzard
kept 27 Northwest flights on the runway.

Now she is pursuing an individual suit and is a plaintiff in one
of three class actions against Northwest claiming false
imprisonment and negligence. The largest, which could have as
many as 8,000 claimants, is set to be certified in Michigan on
June 18.

The suits underscore wide resentment among airline passengers,
whose complaints increased 26% from 1997 to 1998, according to
the government. Through March, complaints totaled 2,840, up
nearly 69% from the 1,682 in the same period in 1998.

Lawrence Charfoos, of Detroit's Charfoos & Christensen, who is
heading the largest class action, is seeking $80 million, about
$10,000 per passenger.

"We don't think they're warranted," Northwest representative
John Austin said of the suits. Conceding that the passengers
were "horribly inconvenienced and horribly treated," Northwest
believes an "effusive apology" and the offer of free tickets are
enough. "We don't believe it rises to the level of a legal
action," Mr. Austin said. The airline declined to comment on Ms.
Sousanis' separate suit.

A recent court decision and congressional action are aimed at
giving passengers more rights.

A bill by Representative Bud Shuster, R-Pa., would require
airlines to compensate passengers kept waiting on runways more
than two hours and to explain flight delays, cancellations and

In Charas v. Trans World Airlines, 160 F.3d 1259, the U.S. Court
of Appeals for the 9th Circuit found that airlines are not
immune from state liability claims for personal injuries.
Federal law protections from suits over "service," the court
said, don't apply to flight attendant assistance and the
dispensing of food and drinks. (The National Law Journal; June
7, 1999)

OXFORD HEALTH: Judge Refuses to Dismiss Shareholders NY Suit
In an action that legal experts said made an out-of-court
settlement more likely in a shareholder class action lawsuit
against Oxford Health Plans, a Federal district judge in White
Plains has rejected an Oxford motion seeking to have the suit
dismissed. Also affected by the ruling were other defendants,
including 10 former and current senior executives and board
members of Oxford.

The shareholders class, including the Colorado Public Employees
Retirement Association, accused the Oxford officials of
knowingly making false and misleading statements about the
company's financial problems in 1996 and 1997. The value of
Oxford stock plunged 62 percent in October 1997 after the
company disclosed that it would report a loss in the third

Oxford, which has since reorganized and appointed Norman Payson
as chief executive, had attributed its troubles to computer
problems, which it repeatedly said were being solved. On the
contrary, the plaintiffs charged, a computer consulting firm,
the Oracle Corporation, determined in October 1996 that the
Oxford computer system was "so deficient that Oxford should stop
adding functions and related data to it."

The suit also accuses the officials, including Stephen Wiggins,
the founder and former chief executive of Oxford, of selling
common stock in late August 1997 for a total of more than $78
million, with total profits of $33 million.

Judge Charles L. Brieant said in a June 8 ruling that was made
available yesterday by plaintiffs' lawyers that the defendants'
arguments in asking dismissal were "without merit."

Such rulings cannot be appealed and are rarely reversed,
according to lawyers familiar with the issues. They added that
most shareholder class action lawsuits were settled out of

Patricia M. Hynes of the plaintiffs' law firm, Milberg Weiss
Bershad Hynes & Lerach, said the judge's latest ruling "permits
us to go forward with discovery and to litigate the case."

The defendants also include William Sullivan, president of
Oxford; Andrew Cassidy, former executive vice president and
chief financial officer; Jeffrey Boyd, executive vice president
and general counsel; Robert Smoler, former chief of the New York
region; David Finkel and Dr. Thomas Travers, former vice
presidents; Dr. Benjamin Safirstein, a board member and former
medical director; Brendan Shanahan, vice president and
controller, and Robert Milligan, an outside member of the board.

The individual defendants would presumably be covered by
liability insurance for Oxford directors and officers.

Robert Giuffra, Jr., a lawyer for Oxford, said yesterday that
the big managed health care company was "disappointed that its
motion was denied and intends to defend this action vigorously."
Mr. Giuffra, a member of the Sullivan & Cromwell law firm, said
that the motion was preliminary, and he noted that the judge had
not made any findings on the facts.

Judge Brieant said that under court rules for deciding on
motions to dismiss, he was required to assume, at this stage,
that the charges were true. In a parallel action on May 25, the
judge denied a request for dismissal of a class action lawsuit
against KPMG, the accounting firm that Oxford dismissed last
summer. KPMG asked Judge Brieant to reconsider that ruling last

John Fidler, a spokesman for KPMG, said yesterday that the May
25 ruling was "just another procedural step in the process." He
added, "We expect ultimately that the case will be dismissed,
because we believe the allegations are false and cannot be
proven." (The New York Times; June 15, 1999)

P&O HOLIDAYS: Cruise Passengers Sue Down Under Over Typhoid
Australian lawyers acting for passengers who allegedly caught
typhoid fever on a cruise to Papua New Guinea today started
legal action against P&O Holidays Ltd. Melbourne lawyer Mark
Walter said a class action had been lodged with the Federal
Court in Melbourne, with the lead applicant Melbourne resident
Claire Gulieri, who was "still ill, but getting better". Mr
Walter said other passengers who caught typhoid could join the
class action as it proceeded.

Meanwhile, the National Centre for Disease Control announced the
number of confirmed typhoid cases had risen to five, with a 30-
year-old Victorian woman confirmed as having the disease. The
announcement followed news that a 48-year-old Perth woman had
tested positive to the disease and was being treated at home.

Three other passengers, a 38-year-old man from Wangaratta,
Victoria, a 51-year-old Melbourne woman and a 36-year-old Sydney
man, also have been diagnosed with typhoid.

Mr Walter said a preliminary hearing was due to be held on June
23, but it was not clear when a full hearing would be heard. He
said the legal bases for the claim were: an alleged breach of
the Trade Practices Act that P&O had engaged in misleading and
deceptive conduct by saying the food would be safe, and
negligence at common law.

West Australian Health Department medical coordinator Tony
Watson said the Perth woman had been given antibiotics by her GP
and was resting at home.

"The woman's illness started at the beginning of June - the same
time as the other three cases - and she had the classic symptoms
of typhoid including fever, sweating, headaches, malaise,
abdominal pain, vomiting and diarrhea," Dr Watson said. "The
Health Department is currently following up contacts of the
woman to advise them to consult their doctor if they develop
symptoms of typhoid. It is highly unlikely that people in
contact with this woman will develop typhoid, as it is not
easily transmitted from person to person."

He said the department was still trying to trace nine of the 130
WA passengers aboard the cruise to see if they showed any signs
of the illness. "We are currently collecting fecal samples from
25 passengers who may have been exposed to the typhoid but who
haven't developed the typical symptoms," Dr Watson said.

The 25 are believed to be among 153 passengers who went on an
eight-hour tour of Papua New Guinea's famous World War II
battleground, the Kokoda Trail. All four of those who have been
diagnosed with typhoid went on the tour.

Dr Watson said it was unlikely any new typhoid cases would be
diagnosed because the incubation period for the disease was
usually one to two weeks.

The Fair Princess cruise No 76 left Cairns on May 12 with 925
Australian and New Zealand passengers, travelling to Port
Moresby, Samarai Island, Milne Bay, Honiara, Champagne Bay and
Port Vila before returning to Sydney. (AAP NEWSFEED; June 11,

POLAROID CORPORATION: Milberg Weiss Files Suit in Massachusetts
A class action lawsuit was filed by Milberg Weiss Bershad Hynes
& Lerach in the United States District Court for the District of
Massachusetts on behalf of all persons and entities who
purchased the common stock of Polaroid Corporation (NYSE: PRD)
between April 16, 1997 and August 28, 1998.

The complaint charges Polaroid, and certain of its officers and
directors with violations of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 as well as Rule 10b-5. The
complaint alleges that defendants issued a series of materially
false and misleading statements concerning the Company's
operations and operating results. Because of the issuance of a
series of false and misleading statements the price of Polaroid
common stock was artificially inflated.

To learn more, contact Steven G. Schulman or Samuel Rudman at
800-320-5081 or at endfraud@mwbhlny.com via email.

PREMIERE TECHNOLOGIES: Xpedite Systems Suits Consolidated in GA
Major shareholders sued for breach of contract and securities
fraud in connection with a merger agreement between Xpedite
Systems, Inc. and Premiere Technologies Inc. The merger
agreement contained a forum selection clause requiring
submission to jurisdiction in New York's Southern District.

Defendants moved to transfer the action to the Northern District
of Georgia, where a consolidated action of 22 related cases,
alleging non-disclosure and misrepresentation, had already been
filed against them.

Granting the motion, the U.S. Dist. Ct. (S.D.N.Y.) found that
the forum selection clause was not dispositive, since there was
a substantial overlap of claims and identical legal issues. It
also noted that plaintiffs might not be able to invoke the
clause, as they were not a party to the agreement. (New York Law
Journal; May 27, 1999)

PRISON REALTY: Pomerantz Haudek Files Complaint in Tennessee
Pomerantz Haudek Block Grossman & Gross LLP filed a class action
lawsuit in United States District Court for the District of
Tennessee, against Prison Realty Trust, Inc. (NYSE: PZN) and
certain directors and officers of the Company, for securities
fraud and other violations of the federal securities laws. The
action is on behalf of all investors who acquired the Company's
common stock between October 16, 1998 and May 14, 1999,
including shareholders of Corrections Corporation of America
("Old CCA") and CCA Prison Realty Trust whose shares were
exchanged for the common stock of Prison Realty in a merger
which closed December 31, 1998.

The Complaint alleges that Prison Realty and certain of its
officers and directors violated 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, as well as Rule 10b-5, by
engaging in a scheme to conceal material information from
shareholders of Old CCA and CCA Prison Realty Trust in
connection with the merger that created Prison Realty and spun-
off a new, privately held CCA ("New CCA") on December 31, 1998.
The false and misleading statements of the defendants also
served, before and after the merger, to artificially inflate the
price of the Company's securities and those of its predecessors.

The complaint charges that -- in order to gain shareholder
approval of the merger and spin-off -- the defendants concealed
their intent to substantially increase the amount of fees that
Prison Realty, the new public company, would pay to the
privately held New CCA after the merger closed. The Complaint
also charges that the defendants misrepresented New CCA's
ability to pay fair market rents to Prison Realty after the
merger. The individual defendants, in addition to being officers
or directors of Prison Realty, are also officers of New CCA or
own a substantial portion of its stock.

On May 14, 1999, the Company disclosed that it had retroactively
increased the fees that Prison Realty pays to New CCA by
approximately $80 million per year. Additional details were
contained in a Form 10-Q filed with the SEC on May 16, 1999,
including that fact that Prison Realty had increased the fees on
May 4, 1999, but did not disclose that event until ten days
later. The disclosures caused the price of Prison Realty to
plunge from $19 3/4 on Friday May 14, 1999 to a closing price of
$13 3/8 on May 18, 1999.

For more information, contact Mildred C. Frazzitta, Esq. or
Julian P. Carr at 888-476-6529 or mcfrazzitta@pomlaw.com via

PRISONER RIGHTS: Concern Grows About Using Electronic Stun Belts
Despite growing concern from human rights groups and a federal
court decision banning the devices in Los Angeles County,
courtrooms throughout California continue to use electronic stun
belts on defendants. The belts are used to restrain defendants
and prisoners considered violent or a flight risk. They allow
sheriff's deputies to deliver -- at the push of a remote control
button -- a 50,000 volt shock that temporarily disables the

Alameda and Santa Clara counties are among those that continue
to use the stun belts. Calling the belts safe and effective,
sheriffs in those counties say the belts allow defendants who
are considered dangerous to appear in court before a jury
without visible restraints, such as shackles, which could
prejudice their case.

But the human rights group Amnesty International is calling on
law enforcement agencies to ban electric stun equipment,
particularly stun belts. The group released a report equating
the belts with torture devices, saying they pose a medical and
psychological threat to those ordered to wear them. The shock
from a stun belt is excruciatingly painful and may cause the
wearer to lose bladder or bowel control, the report says. "The
use of the stun belt, even when not activated, constitutes
cruel, inhuman or degrading treatment or punishment as outlawed
under international law," it says. The report states that at
least 18 counties in California employ the belts and that their
use is increasing across the country. The belts are prohibited
in Massachusetts, Michigan and New Jersey.

In California, a U.S. district court judge banned the belts from
Los Angeles courtrooms after a municipal court judge ordered a
Three Strikes defendant shocked for repeatedly interrupting her.
The district court's ruling has been taken up by the Ninth
Circuit U.S. Court of Appeals.

A product liability case against the manufacturer of the belt,
Cleveland-based Stun Tech Inc., will be handled by Los Angeles'
Yagman & Yagman -- the same attorneys who filed the stun belt
suit that led to the ban in L.A.

Yagman & Yagman also represents Ronnie Hawkins, the defendant
shocked with a stun belt for talking over a judge during a
sentencing hearing in Long Beach Municipal Court. Hawkins was
facing 25 years to life for stealing $265 in pain medication
from a pharmacy. After warning an irate Hawkins numerous times
to be quiet or face the consequences, L.A. Municipal Court Judge
Joan Comparet-Cassani ordered the deputy to shock him.

In _Hawkins v. Comparet-Cassani_, 95-1025, U.S. District Judge
Dean Pregerson ruled in January that the belts could prevent a
defendant from receiving a fair trial. "For example, a defendant
may be reluctant to object or question the logic of a ruling --
matters that a defendant has every right to do," Pregerson
wrote. He also allowed Hawkins' case to be tried as a class
action on behalf of all prisoners in the sheriff's custody in
Los Angeles County.

The county has appealed Pregerson's ruling to the Ninth Circuit.

Paul Hoffman, an L.A. attorney who submitted an amicus curiae
brief on behalf of Amnesty International, says that the ruling
will impact other jurisdictions. "The Hawkins case is being
closely watched around the country," said Hoffman, adding that
it is a perfect example of how the belts can be misused. Stephen
Yagman, Hawkins' attorney, also noted that the ruling makes
other counties more vulnerable to future stun belt suits.

But Los Angeles County Counsel Roger Granbo said Pregerson's
ruling will only make the courtroom a more dangerous place.
"When the belts are used properly they are much less intrusive
than shackles or gags -- they have probably prevented a number
of injuries," Granbo said.

Yagman, whose office is representing Hawkins in the Los Angeles
case, says the U.S. district court ruling makes other counties
more vulnerable to stun belt suits. He said he was surprised to
hear that Alameda County is still using the belts. "Maybe they
have so much money in Alameda County that they don't care," he
said. (The Recorder; June 11, 1999)

SELECT COMFORT: Lockridge Grindal Files Complaint in Minnesota
Lockridge Grindal Nauen & Holstein P.L.L.P. filed a class action
complaint in the United States District Court for the District
of Minnesota on behalf of persons who acquired securities issued
by Select Comfort Corp. (Nasdaq:AIRB) in the open market during
the period January 25, 1999 and June 7, 1999.

The Complaint charges that defendants violated the U.S.
securities laws by issuing materially false and misleading
statements and by omitting material facts required to be
disclosed so as to make the statements issued not materially
false and misleading. Specifically, the complaint alleges that
defendants failed to disclose that the Company's only source of
customer financing had significantly tightened its credit
standards in January 1999 and that the Company's sales had been,
and would continue to be severely negatively impacted. The
Complaint also charges defendants with issuing a series of
materially false and misleading statements in order to obscure
the truth concerning the Company's sales and financial

The true facts concerning the dire state of the Company's
financial condition were finally disclosed prior to the
commencement of trading on June 8, 1999. When trading in Select
Comfort's shares opened later that day, the price of the
Company's common stock plunged more than 43% from $13 1/8 to $7
7/16 evidencing the materiality of the information that had long
been withheld from Class members by defendants.

For more information, call Karen M. Hanson at 612-339-6900 or
write to kmhanson@locklaw.com via email.

SELECT COMFORT: Wolf Popper Files Complaint in Minnesota
A class action lawsuit has been filed against Select Comfort
Corporation (Nasdaq: AIRB) in the United States District Court
for the District of Minnesota by the law firm of Wolf Popper LLP
on behalf of persons who purchased Select Comfort common stock
in the open market during the period January 25, 1999 through
June 7, 1999.

The Complaint charges that defendants violated the U.S.
securities laws by issuing materially false and misleading
statements, and by omitting material facts required to be
disclosed so as to make the statements issued not materially
false and misleading. Specifically, the complaint alleges that
defendants failed to disclose that the Company's only source of
customer financing had significantly tightened its credit
standards in January 1999 and that the Company's sales had been,
and would continue to be severely negatively impacted.

The true facts concerning the dire state of the Company's
financial condition were finally disclosed prior to the
commencement of trading on June 8, 1999. When trading in Select
Comfort's shares opened later that day, the price of the
Company's common stock plunged more than 43% from $13-1/8 to $7-
7/16 per share, evidencing the materiality of the information
that had long been withheld from Class members by defendants.

To learn more, contact: Paul 0. Paradis, Esq. or Catherine R.
Anderson, Esq. at 212-451-9676, 212-451-9623, or 877-370-7703,
or write pparadis@wolfpopper.com or canderso@wolfpopper.com via

U.S. BANCORP: Eckart Firm Says Bank Sold Confidential Info
A St. Paul law firm is suing U.S. Bancorp and First Bank System,
days after the Minnesota state attorney general announced a
lawsuit against U.S. Bank that alleged it sold confidential
information to a telemarketer.

Attorney Harvey Eckart, who filed the lawsuit Friday in U.S.
District Court in St. Paul, said Monday he is seeking to have
the case certified as a class-action lawsuit for customers who
were affected in U.S. Bank's 17-state service area. The amount
of damages sought hasn't been determined, Eckart said.

In a lawsuit filed Wednesday, Attorney General Mike Hatch
accused Minneapolis-based U.S. Bank of illegally selling
customer data to a telemarketing company and pocketing $4
million in commissions and fees. The lawsuit also said the
telemarketer, MemberWorks Inc. of Stamford, Conn., "slammed"
some bank customers, charging them for unauthorized purchases by
having U.S. Bank deduct money from their accounts and credit

U.S. Bancorp, the parent company of U.S. Bank, announced
Thursday it has discontinued relationships with about 15
telemarketing companies, saying it was too confusing for
customers to have the bank affiliated with sales of nonfinancial
products. Donn Waage, a senior vice president with U.S. Bancorp,
said the most recent lawsuit was expected. "We think that, like
the attorney general's suit, this is also without merit," he
said. U.S. Bancorp became based in Minneapolis in 1997 when
First Bank System Inc. of Minneapolis acquired Portland, Ore.-
based U.S. Bancorp. (AP Online; 06/14/99)

U.S. BANCORP: Wolf Popper Charges Bank Sold Customer Information
U.S. Bancorp was hit last week with a class action claiming the
Minneapolis-based bank violated federal and state laws when it
sold customer information to third parties.

The suit, filed in U.S. District Court for the District of
Minnesota, represents everyone "affected by U.S. Bancorp's
practices, including residents of each of the 17 states U.S.
Bancorp operates in and defendants' customers who are resident
in other states as well," said a statement by the law firm
bringing the case, Wolf Popper LLP. (The American Banker; June
15, 1999)

US DOE: Provides Medical Coverage for Ohio Nuclear Plant Workers
Hundreds of employees of a nuclear weapons plant fearing life-
threatening illness from long-term radiation exposure announced
the settlement of a multi-million dollar class-action lawsuit
with the government. The settlement, which still must be
approved by a US District Court, provides lifetime medical
coverage for the 1,800 current and former employees of the
Department of Energy (DOE) Mound nuclear plant near Dayton,

The cost of the settlement was expected to total several million
dollars, depending on the insurance and medical costs over the
coming years, officials said.

"This settlement is a constructive step toward making peace with
a workforce who trusted management, but was victimized by its
disregard for radiation protection and rules," said Robert
Wages, president of PACE, the workers' union.

The DOE, while admitting no wrong doing, agreed to pay for the
treatment of any illnesses workers develop that can be
associated with radiation exposure at the nuclear weapons
facility, said Energy Secretary Bill Richardson.

While no serious illnesses have been reported, union
representatives said that the employees will live their lives in
fear of developing any of several serious forms of cancer.

The DOE agreed to provide coverage for employees who contract
cancer of the brain, nervous system, bladder, bone, lung,
pancreas, digestive system and other areas.

Plant employees filed the lawsuit in 1995, charging that plant
managers failed to monitor and warn workers about radiation
exposure on the job. Employees alleged that samples collected to
measure internal radiation doses remained untested for more than
three years, leaving them to toil at their own peril.

The Mound facility began operations in 1947 as a nuclear weapons
production plant and operated until 1995. The plant currently is
undergoing environmental cleanup and is providing nuclear
battery sources for the National Aeronautics and Space
Administration. (Agence France Presse; June 11, 1999)

WEST PUBLISHING: Worker Stock Sex Discrimination Class Certified
A federal judge in Tampa, Fla., granted class action status on
May 20 to a lawsuit charging West Publishing Co. with a pattern
of employment discrimination against women. The plaintiffs, a
class of approximately 150 women who were employed by the Eagan,
Minn.-based legal publisher, claim that the company
systematically shut female employees out of a stock ownership
program that was designed to reward favored employees and keep
them with the company. Carter v. West Publishing Co., No. 97-
2537 (M.D. Fla.).

The women in the class worked for West in 1996, when Thompson
Legal Publishing, a Canadian company, bought West to form The
Thompson Corp. Two-thirds of the plaintiffs are lawyers or women
with law degrees, said one of their lawyers, Guy M. Burns, of
Johnson, Blakely, Pope, Bokor, Ruppel & Burns P.A., in Tampa.

After the merger, the plaintiffs claim, West Publishing stock
was redeemed at five times its book value, making millionaires
out of most of the 151 male employees who were paid nearly $3
billion for their shares.

Mr. Burns said that although women constituted approximately 60%
of West's work force, less than 3% of the employee-owned stock
was held by women.

The plaintiffs also claim that many of West's women were
sexually harassed. U.S. District Judge Richard A. Lazzara, of
Tampa, has ruled that any evidence of sexual harassment will be
limited to explaining the discrimination charges.

In a statement, West Group said, "This case is without merit. We
believe that class certification is unwarranted and we will
immediately appeal this decision to the 11th Circuit Court."
(The National Law Journal; June 7, 1999)

Y2K LITIGATION: NY Law Journal Files Report on Current Cases
With fewer than 300 days remaining before the year 2000 arrives,
there have been flurries of suits filed, cases decided and
settlements reached, according to the New York Law Journal.

The first Y2K-related suit of 1999 was filed on Jan. 14,
alleging material misrepresentations and deceptive sales
practices against computer retailer Circuit City for selling
computer products that allegedly cannot handle dates on or after
Jan. 1, 2000. Johnson v. Circuit City Stores Inc., No. C99-00054
(Cal. Super. Ct., Contra Costa County, filed Jan. 14, 1999). A
case involving software bought in 1993 soon followed. Milton
Bradley Corp. v. Garpac Corp., No. 600463/99 (N.Y. Sup. Ct.,
filed Jan. 25, 1999).

A rundown of the key decided cases and an overview of pending
Y2K-related bills before Congress is available on-line at

There are two underlying reasons for the litigation, says
Charles L. Kerr, a New York partner at Morrison & Foerster LLP.
who moderates an e-mail discussion list for lawyers facing Y2K

One is unrelated to the software's ability to handle dates or to
the merits of a case since courts have begun dismissing the
suits if no damage has occurred. "Many cases being brought now
are being brought by law firms solely to position themselves as
having credibility in the area," said Mr. Kerr. The hope is
"that in the next phase, where there have been actual losses,
people will come to them. These cases are as much a marketing
tactic as anything else."

The second reason is more obvious: People, and plaintiffs'
lawyers, are demanding that upgrades to Y2K-compliant software
be free.

And software companies are complying. On April 16, a
Massachusetts court approved a class action settlement that
requires software manufacturer RealWorld Corp. to make free
upgrades available to purchasers of recent software, to discount
some future purchases and to offer free software subscription  
maintenance for one year. The settlement is intended to preserve
the relationship between the small, privately held accounting
software company and its customers, said Larry Kulig, of
Boston's Goldstein & Manello PC, who represented the plaintiffs
with his partner Gary Greenberg and associate Karen Deeley.

There may be more such settlements as Jan. 1, 2000, approaches.
"Critical to our settlement was the timing issue," Mr. Kulig
said. "Instead of reaching a settlement at the end of 1999 that
people wouldn't be able to take advantage of, we [sought a
remedy] that would be available to the most amount of customers"
before they incurred losses due to noncompliant accounting
software. The class members can claim the settlement through
Sept. 30; the value to the average class member is about $ 915,
Said Mr. Kulig: "The real benefit is the free software
maintenance." The firm has several similar cases in the works,
Ms. Deeley added.

Despite the number of cases filed, there is still scant
precedent. Causes of action include breaches of covenants of
good faith and fair dealing, unfair trade practices, deceit,
fraud, misrepresentation and the kitchen sink. A case in which
actual losses were incurred because of cash registers' inability
to handle credit cards with dates after 1999 was brought under a
"lemon law" statute. That case settled.

The first appellate decision rendered in a Y2K-related case
dismissed the suit by strictly interpreting the software license
agreement to exclude Y2K claim. Paragon Networks International
v. Macola Inc., Case No. 9-99-2 (Court of Appeals, 3d App.
Dist., Marion County, Ohio). The decision is posted at

"The most important thing was the court enforcing the terms of
the license agreement against a claim of Y2K noncompliance,"
explained Bruce L. Ingram, the partner at Vorys, Seymour, Sater
and Pease LLP who handled the case. "If this case is followed,
as it should be, it will be difficult for Y2K plaintiffs to
recover [against software makers] where there's a good, well-
written limited warranty." He added that a free upgrade to a
Y2K-compliant version of Macola's software is available. "Most
software developers I've dealt with want their software to work
well," he said.

Much of the Y2K-related legislation in Congress would
"federalize" rulings in cases that, like Macola, limit remedies.
"The bills are a boon to software manufacturers," says Morrison
& Foerster's Charles Kerr. "Unless you find some independent
consumer protection law, it's not clear that a company has a
continual obligation" to support software through the year 2000.
(New York Law Journal; June 1, 1999)


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

Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard
Group, Inc., Washington, DC. Peter A. Chapman, Editor. Kent L.
Mannis, Project Editor.

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

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