CAR_Public/990930.MBX                  C L A S S   A C T I O N   R E P O R T E R

                Thursday, September 30, 1999, Vol. 1, No. 167

                                  Headlines

ANTS SOFTWARE: Cleared Of Suit By Shareholders Short-Selling Illegally
ASBESTOS LITIGATION: Hyde Issues Statement on Legislation
ASSOCIATES CONSUMER: Penn Ct Dismisses Suit; Usury Law Canít Be Used
CARNEGIE INTíL: Replaces Accounting Firm; Securities Suit Pending
CASINO DATA: Final Ct Approves Of Settlement For Securities Suits

COCA-COLA: Submits Some Documents In Employees Racial Bias Suit
CORPORATE EXPRESS: Pursues Settlement For Shareholders Suit In Colorado
HEALTH MANAGEMENT: Will Continue To Contest Securities Suit In NY
HEALTH MGT: HHL Promissory Note Holders Sue In NY Over Fiduciary Breach
HMOs: ABC News Coverage On New Law In CA For Patients To Sue

HOLOCAUST VICTIMS: German Official Denies Report On Slave Labor Fund
HUDSON TECHNOLOGIES: NY Ct Dismisses Securities Suit
INNISFIL COUNCIL: Canadian Resident Wages Class Suit Over Waste Plant
KUTAK ROCK: Law Firm Sued By Schools In Penn Over Fraud In Investments
OSICOM TECHNOLOGIES: Will Defend Vigorously Securities Suit In CA

PETSMART INC: Arizona Ct Grants Motion To Dismiss Securities Suit
PETSMART INC: Trial On FLSA Case In Florida Scheduled For Dec 1, 1999
PRUDENTIAL INSURANCE: Judge Sanctions Attorney In Sales Practices Suit
STEWART ENTERPRISES: Kohn, Swift Files Securities Suit In Louisiana
SYSTEM SOFTWARE: Illinois Appellate Ct Affirms Settlement For Suits

* How Local Congress Members Voted On Gun Suits And Tobacco Suits

                               *********

ANTS SOFTWARE: Cleared Of Suit By Shareholders Short-Selling Illegally
----------------------------------------------------------------------
On May 9, 1986 the Company (formerly Chopp Computer Corp/De/) was
advised that a class action suit had been filed against the company for
$400,000,000.00 by a shareholder. Subsequent events determined that the
action had been initiated by the accountant of an ex-IRS attorney by the
name of Alexandr Laurins. Mr. Laurins in association with Lawrence
Merryman, an attorney from Orange, California and Nash Dowdle, an oil
promoter from Midland, Texas had decided that the plans of Chopp to
build a new supercomputer were a pipe dream and in fact part of a stock
scam. Unknown to the company Mr. Laurins was already under investigation
by the FBI and the SEC for among other things, selling $150,000,000.00
of non-existent shipping containers as tax shelters.

The class action mentioned above became the center-piece of an
Investment Advisory Letter, called the Durant Livermore Cutten & Bliss
Report which was mailed to all of the shareholders of the company whose
names had been listed with the SEC when the company had filed its SEC
12(g) exemption, as well as brokers all over Canada and the U.S. The
newsletter was in fact prepared and distributed by Laurins from his
office on Union Street in San Francisco, and was filled with lies and
mis-information about the Company. Laurins printed 10 or 11 issues up to
June 30, 1986.

Laurins, Merryman & Dowdle had made illegal short sales of approximately
100,000 shares of the company for approximately $ 1.25 million, without
borrowing the shares to offset their short position. The stock price did
not go down as they had anticipated so they manufactured the bogus
newsletter to help things along. This all became apparent when the
Secretary-Treasurer of the company was approached and was advised by Mr.
Dowdle that the matter could be resolved if a meeting could be arranged
between the Secretary-Treasurer and the three conspirators. It took
about three weeks to arrange for a meeting in San Francisco to take
place on June 26, 1986.

Once the meeting had been arranged the Company's attorney contacted the
FBI and arranged for the Secretary-Treasurer to be wired, but only after
convincing the FBI that the only purpose of the meeting was to attempt
to extort the 100,000 shares that the three were illegally short. The
meeting took place in the Presidio where Laurins, Merryman and Dowdle
did, in fact do exactly that. The entire conversation was recorded and
was the basis for the Company being awarded a $30,000,000.00 RICO award,
jointly and severally against the three conspirators. Unfortunately the
court system moved very slowly as the case did not come to court to be
resolved until September, 1990. The victory saved the reputation of the
Company, but legal fees ate up everything recovered to date.

During the years waiting to resolve this legal issue the Company
struggled through on two Government Grants, developing potential
products for the U.S. Navy. Nothing commercial was developed from this
work. While the Companyís work was on hold the computer industry,
particularly the personal computer industry was expanding rapidly,
driven by Intel with its faster chips and Microsoft providing the
software which further fueled the growth. During this period nobody was
giving any thought to parallel computers, the basis of the Companyís
patents and existence.

The company was able to maintain its patent and in fact was granted U.S.
Patent 4,707,781 on November 17, 1987 on Shared Memory Computer Method
and Apparatus. Another U.S. patent Number 5,438,680 was issued on August
1, 1995 entitled Method and Apparatus for Enhancing Concurrency in a
Parallel Digital Computer.

In January, 1993 the Company sold a license to develop and market a
software product to Mosaic Multisoft Corp. a Nevada Corporation based in
San Diego. The payment schedule was not met and the license was
cancelled in 1995.


ASBESTOS LITIGATION: Hyde Issues Statement on Legislation
---------------------------------------------------------
House Judiciary Committee Chairman Henry Hyde issued the following
statement regarding his ongoing efforts to resolve the national judicial
crisis stemming from the backlog of Asbestos personal injury claims:

"The liability created by asbestos litigation has transcended any other
mass tort in the history of the United States. More than twenty billion
dollars in compensation has already been paid to victims by various
companies, and more than 200,000 claims are still pending. Furthermore,
over fifteen companies have filed for bankruptcy and over 400,000
additional claims are pending against the Manville Trust. Meanwhile, the
victims who are being compensated are still paying contingency fees,
although almost all asbestos claims are being settled out of court.

"Unsuccessful, massive class action settlements which would have
resolved both the enormous backlog of asbestos claims, as well as future
asbestos claims, have led the Supreme Court to repeatedly call for
congressional action. In the private sector, Owens Corning has led the
way with an innovative private settlement plan to manage its asbestos
responsibility and compensate over 200,000 victims. Future claims are
being resolved administratively without litigation. A program such as
this will allow industry to continue to grow, supporting our nation by
employing American workers and continuing to make an important
contribution to our communities.

"I am committed to resolving this litigation crisis once and for all.
Private solutions, like the one established by Owens Corning, will not
be adversely affected by any legislation. The Committee will be holding
meetings with the interested parties to redraft a bill which will be
ready for mark up in the near future. This bill will provide a fair and
an efficient compensation program for victims, and create a predictable
and manageable financial future for defendant companies. I believe the
bill will receive bipartisan support which is essential to its passage."
(Source: U.S. House of Representatives Committee on the Judiciary;
Contact: Sam Stratman or Michael Connolly, 202-225-2492, for the U.S.
House of Representatives Committee on the Judiciary)


ASSOCIATES CONSUMER: Penn Ct Dismisses Suit; Usury Law Canít Be Used
--------------------------------------------------------------------
Philadelphia lawyers defending a finance company used an affidavit from
the drafter of the state's 1974 usury law to help persuade a judge to
dismiss a plaintiff's lawsuit.

The result, according to lawyers at Reed Smith Shaw & McClay, was the
first written opinion in Pennsylvania holding that a class action may
not be brought under the commonwealth's usury statute. "As the
defendants clearly show, through their recounting of the usury statute's
legislative history, class actions are not authorized," wrote Judge
William R. Carpenter of the Montgomery County Common Pleas Court.

The plaintiff in Sees v. Associates Consumer Discount Co. had obtained a
personal loan and credit insurance from the defendant and its affiliate
insurance company. The money went to purchase a truck and enroll in a
truck-driving job-placement program. After becoming unhappy with the
job-placement program, the plaintiff sought legal advice. His attorneys
then turned their attention to the loan agreement, according to the
judge's opinion. Subsequently, the plaintiff sought class certification,
alleging, inter alia, that the loan charges were improperly calculated
in violation of the usury statute, commonly known as Act 6 or the Loan
Interest Protection Law.

To help convince the court that the 25-year-old legislation was not
intended to provide class action relief, Reed Smith partners Robert A.
Nicholas and Leonard A. Bernstein enlisted the aid of Lawrence J.
Beaser. Beaser, a partner at Blank Rome Comisky & McCauley, drafted the
law while serving as counsel to then-Gov. Milton J. Shapp. Beaser's
affidavit explained that the bill, as originally proposed by the Shapp
administration, provided the right to bring a class action. This
provision, however, was quickly and expressly rejected by the state
Senate, he stated. Neither was this revision restored when the bill
underwent three more revisions, Beaser stated. The Legislature, Beaser's
affidavit concluded, "has specified that actions brought under Act 6 may
be brought only as individual actions and may not be brought as class
actions."

The judge found that, although Beaser's affidavit was "not binding on
this court," its explanation of the bill's history "is instructive of
the legislative intent behind the usury statute." An affidavit from the
legislation's author "is not readily available from traditional legal
research sources," acknowledged Nicholas. Beaser's affidavit provided
"an insight which the court couldn't ignore," Bernstein said. The
affidavit, as well as the plain language of the usury statute, was
relied upon by Reed Smith associate Sean M. Halpin in briefing the
argument against class certification. Plaintiff's attorneys Mark R.
Cuker and Jay S. Cohen declined comment. (The Legal Intelligencer
9-29-1999)


CARNEGIE INTíL: Replaces Accounting Firm; Securities Suit Pending
-----------------------------------------------------------------
Carnegie International disclosed that it has fired its accounting firm,
Grant Thornton, LLP, and has replaced them with Merdinger, Fruchter,
Rosen & Corso, PC, which has begun auditing Carnegie's prior financial
statements for the fiscal years 1997 and 1998; the audit is expected to
also cover Carnegie's 1999 financial statements. Carnegie's President
and CEO Lowell Farkas had previously stated that the company would
restate its financial results for 1997 and 1998 upon completion of the
Securities and Exchange Commission's review of its financial statement
filings.

Pomerantz Haudek Block Grossman & Gross LLP was recently named co-lead
counsel, along with Wolf Haldenstein Adler Freeman & Herz, LLP, in a
class action suit against Carnegie International Corp. (Amex: CGY) and
certain of its officers and directors.

The complaint alleges that Carnegie issued materially false and
misleading financial statements, as well as false and misleading
statements about the Company's operations and business prospects. It is
also alleged that Carnegie was in violation of generally accepted
accounting principles ("GAAP") in accounting for its acquisitions in
1997 and 1998. The Complaint alleges that, as a result of these and
other false and misleading statements, the market price of Carnegie
stock was artificially inflated during the Class Period, October 28,
1998 through April 30, 1999 (inclusive).

If you wish to discuss this action or have any questions or relevant
information, please contact Andrew G. Tolan, Esq. of the Pomerantz firm
at 888-476-6529 (or 888-4-POMLAW), toll free, or at agtolan@pomlaw.com
by e-mail. Those who inquire by e-mail are encouraged to include their
mailing address and phone number.


CASINO DATA: Final Ct Approves Of Settlement For Securities Suits
-----------------------------------------------------------------
Casino Data Systems (Nasdaq: CSDS) announced that the Nevada Federal
District Court in Gary Edwards v. Casino Data Systems gave its final
approval to the settlement of the securities class action lawsuits, as
previously reported by the Company. The Court will enter a final
judgement that will have the effect of terminating all pending
securities litigation actions filed against the Company. Those actions
are styled Gary Edwards v. Casino Data Systems, et al.; Jo Ann
Giovannoni v. NationsBank Montgomery Securities, et al; James Grant v.
Casino Data Systems, et al, and Barry Schwartz as Trustee of the Barry
Schwartz Pension Plan v. Casino Data Systems, Inc. et al. Settlement
proceeds will be distributed to qualified applicants pursuant to the
terms of the settlement.

Casino Data Systems is a Las Vegas-based designer, manufacturer and
distributor of state-of-the-art technology-driven products for the
gaming industry. The Company's diversified product line reaches into
virtually all facets of the casino floor, including slot management
systems, games and meters, multiple site progressive systems and casino
signage. SOURCE Casino Data Systems CONTACT: Lee Lemas, Chief Operating
and Financial Officer, 702-269-5000, or Bruce W. Benson, Esq., General
Counsel, 702-269-5000, both of Casino Data Systems


COCA-COLA: Submits Some Documents In Employees Racial Bias Suit
---------------------------------------------------------------
Coca-Cola Co. has turned over nearly 37,000 pages of documents to the
plaintiffs in a racial discrimination lawsuit but has a legal right to
withhold 93 disputed documents, company attorneys said.

The Atlanta-based beverage giant also said it has offered to make
available more than a million additional pages of relevant documents for
the plaintiffs' attorneys to review if they choose to.

Coca-Cola made the calculations in its formal challenge to the
plaintiffs' effort to see the 93 documents.

The plaintiffs said they are seeking the documents because they are
potentially incriminating to the company. "The documents defendant is
withholding likely contain evidence that senior company officials had
knowledge of and failed to prevent ... barriers to equal employment
opportunity," the plaintiffs alleged in their motion to obtain the
documents. That motion was filed last month.

The plaintiffs said Coca-Cola has engaged in the "selective production"
of favorable documents, while incorrectly withholding unfavorable ones.

But Coca-Cola denied this, saying the company is legally entitled to
withhold the disputed documents. "An uninformed reader might conclude
from plaintiffs' motion that Coca-Cola has been unreasonably stingy in
its (document) production, jealously guarding even the most
fundamentally discoverable documents. ... Nothing could be further from
the truth," the company said.

U.S. District Judge Richard Story will decide the issue after
considering several legal principles, including whether the company can
keep certain communications with its lawyers confidential.

Four current and former employees filed a federal suit in April,
alleging that the company discriminated against African-American workers
in pay, promotions and performance evaluations.

The company has denied those allegations.

The plaintiffs are seeking class-action status so they can represent
1,500 other black salaried employees in the United States. (The Atlanta
Journal and Constitution 9-28-1999)


CORPORATE EXPRESS: Pursues Settlement For Shareholders Suit In Colorado
-----------------------------------------------------------------------
On or about July 20, 1999 and subsequently thereto, Corporate Express
Inc. and each of the members of its Board of Directors were sued by
certain individual shareholders in four separate class action lawsuits
which are being consolidated in Colorado State Court, Boulder County.
The shareholders have alleged that the Company's merger with Buhrmann is
unfair and a breach of fiduciary duty of the Company's Board of
Directors, which will result in damages to the shareholders. The Company
believes the claims are without merit and is pursuing a prompt
settlement which it does not expect to be material. Additionally, the
Company is subject to certain legal proceedings in the normal course of
business. In the opinion of management, the outcome of such litigation
will not have a material adverse effect on the Company's financial
position or operating results.


HEALTH MANAGEMENT: Will Continue To Contest Securities Suit In NY
-----------------------------------------------------------------
In April and May 1997, five purported class action lawsuits were
commenced in the United States District Court for the Southern District
of New York against Health Management Systems Inc. and certain of its
present and former officers and directors alleging violations of the
Securities Exchange Act of 1934 in connection with certain allegedly
false and misleading statements. These lawsuits, which sought damages in
an unspecified amount, were consolidated into a single proceeding
captioned In re Health Management Systems, Inc., Securities Litigation
(97 CIV-1965 (HB) and a Consolidated Amended Complaint was filed.

Defendants made a motion to dismiss the Consolidated Amended Complaint,
which was submitted to the Court on December 18, 1997 following oral
argument. On May 27, 1998, the Consolidated Amended Complaint was
dismissed by the Court for failure to state a claim under the federal
securities laws, with leave for the plaintiffs to replead. On July 17,
1998, a Second Consolidated Amended Complaint was filed in the United
States District Court of the Southern District of New York, which
reiterates plaintiffs' allegations in their prior Complaint. On
September 11, 1998, the Company and the other defendants filed a motion
to dismiss the second Complaint. The motion was fully briefed in late
November 1998, at which time the motion was submitted to the Court. The
consolidated proceeding has been reassigned to another judge. Oral
argument was heard by the Court on the motion to dismiss on June 11,
1999 and the motion is now sub judice. Prior to rendering its decision
on the motion to dismiss, the Court has ordered the parties to attempt
settlement of the case. In the event no settlement is reached and the
motion to dismiss is denied, the Company intends to continue its
vigorous defense of this lawsuit.


HEALTH MGT: HHL Promissory Note Holders Sue In NY Over Fiduciary Breach
-----------------------------------------------------------------------
On June 28, 1998, eight holders of promissory notes of HHL Financial
Services, Inc. commenced a lawsuit against the Company and others in the
Supreme Court of the State of New York, County of Nassau, alleging
various breaches of fiduciary duty on the part of the defendants against
HHL. The complaint alleges that, as a result of these breaches of duty,
HHL was caused to make substantial unjustified payments to the Company
which, ultimately, led to defaults on the Notes and to HHL's filing for
Chapter 11 bankruptcy protection.

On June 30, 1998, the same Note holders commenced a virtually identical
action (the "Adversary Proceeding") in the United States Bankruptcy
Court for the District of Delaware, where HHL's Chapter 11 proceeding is
pending. The Adversary Proceeding alleges the same wrongdoing as the New
York State Court proceeding and seeks the same damages, i.e., $2,300,000
(the unpaid amount of the Notes) plus interest.

Plaintiffs have moved in the Bankruptcy Court to have the Court abstain
from hearing the Adversary Proceeding in deference to the New York State
Court action. The Company has opposed plaintiffs' motion for abstention
and on September 15, 1998, filed a motion in the Bankruptcy Court to
dismiss the Adversary Proceeding. This motion was briefed in December
1998. Oral argument on the motions was heard by the Court on April 22,
1999 and the motions are now sub judice. The Company intends to continue
its vigorous defense of this lawsuit.


HMOs: ABC News Coverage On New Law In CA For Patients To Sue
------------------------------------------------------------
Broadcast September 28, 1999 On ABC News

     PETER JENNINGS: The governor of California just signed into law one
of the most comprehensive health care reform packages in the country. It
gives HMO patients the right to sue their provider. A right the vast
majority of people in managed care elsewhere do not have yet. Here's
ABC's Brian Rooney.

     BRIAN ROONEY, ABC News: (voice-over) When California Governor Gray
Davis signed the bundle of 20 health care reform laws, he said his
intent was to give doctors and patients more power.

     Gov. GRAY DAVIS, (R), California: No longer will a "no" from a
nameless, faceless bureaucrat on the other end of the phone line be the
final word on medical care in California.

     BRIAN ROONEY: (voice-over) The new laws establish a system of
independent review for patients denied care they believe is necessary.
But most importantly, California has given 23 million of its residents
the right to sue their HMO as a last recourse.

     MARK HIEPLER, Attorney: That's the ultimate hope of even people who
do trial work like myself is that this will cause reform from within, so
that the person who is dying and needing care will not be denied because
an HMO is putting profits above their patients.

     BRIAN ROONEY: (voice-over) The laws were designed to help people
like Nick Parrino, whose HMO delayed cancer treatments prescribed for
his son, Steve, who later died.

     NICK PARRINO: It would make our lives easier knowing that he got
every possible treatment that was available. And if he would have got
it, maybe he would still be here.

     BRIAN ROONEY: (voice-over) California becomes only the third state
to pass such HMO reform laws, behind Georgia and Texas. And some
advocates point to Texas as a big success, because its insurance rates
have not gone up and most disputes have been settled in arbitration. But
with five lawsuits pending, the industry says don't celebrate yet.

     JERRY PATTERSON, Texas Association of Health Plans: It doesn't take
much to have one of those lawsuits reach a $100 million plaintiff award,
which would have a very negative effect on premiums and increase the
number of uninsured.

     BRIAN ROONEY: (voice-over) Other legislatures may not wait to find
out what happens in Texas. Thirty-three states are considering HMO
reform.

Brian Rooney, ABC News, Los Angeles.

     PETER JENNINGS: "On the Money" tonight -- a volatile day on Wall
Street. At one point, the Dow Jones Industrial was down more than 200
points. It recovered to finish down more than 27 points, closing at
10,275. On the NASDAQ, stocks were down 5 1/2 points.


HOLOCAUST VICTIMS: German Official Denies Report On Slave Labor Fund
--------------------------------------------------------------------
A German official involved in forming an industry fund to compensate
Nazi-era slave laborers denied a report that said business leaders had
agreed to offer a total 5 billion marks ($ 2.7 billion/2.5 billion
euros) when talks resume next week in Washington. ''That's pure
invention,'' Michael Geier, chief aide to the German government envoy to
the talks, Otto Lambsdorff, said of the report in the business daily
Handelsblatt.

Geier, who accompanied Lambsdorff on a preparatory trip earlier this
week to Washington, said no figures were discussed and none would be
until the next round of talks begins Oct. 6-7.

Handelsblatt, citing unidentified sources with the German negotiators,
said the 5 billion mark sum would be paid by German businesses and the
federal government. The government so far has not said it would pay into
the industry fund.

The German firms have previously talked about paying less than $ 1.7
billion into the fund, far below the $ 20 billion that class-action
lawyers reportedly have demanded.

The latest round of negotiations ended without agreement last month in
Bonn. Participants in the talks include the German and U.S. governments,
German industry, Jewish groups, attorneys for former slave laborers and
several East European countries. (AP Worldstream 9-29-1999)


HUDSON TECHNOLOGIES: NY Ct Dismisses Securities Suit
----------------------------------------------------
United States District Court for the Southern District of New York
Dismisses Claims Filed Against Hudson In 1998.

Hudson Technologies, Inc., (NASDAQ: HDSN), a service provider to the
comfort cooling and refrigeration industry, announced that the Federal
Securities Law class action lawsuit filed in April 1998 by eight
shareholders has been dismissed by the United States District Court for
the Southern District of New York. The Company said that three of the
five claims in the complaint were dismissed with prejudice and the
remaining two were dismissed with leave to amend in 30 days. The
Company, however, believes that the Court's reasoning in dismissing
these two claims will make it difficult for the plaintiff to amend
successfully.

The complaints alleged, among other things, that the Company and certain
of its officers misrepresented material information about the Company's
financial results and prospects and its customer relationships. Founded
in 1991, Hudson has proprietary technology that greatly reduces the
downtime associated with maintaining, operating and repairing large
chiller and reciprocating systems for comfort and process cooling.
Contact Coltrin & Associates Troy McCombs or Eric Anderson 212/221-1616


INNISFIL COUNCIL: Canadian Resident Wages Class Suit Over Waste Plant
---------------------------------------------------------------------
As shouts of ''Shame!'' filled the chamber last night, council voted 5-4
in favour of a waste plant to burn Toronto's garbage. Councillor Bill
Pring, who put forward the motion to approve the $300 million plant,
said Innisfil couldn't afford to miss the economic benefits the plant
would bring. The town south of Barrie will need an extra $10 million for
roads and other services in the next 10 years and ''it would be
irresponsible to force a doubling of residential taxes'' by turning down
the potential tax revenue from the plant, Pring said.

''I'm terribly disappointed. I think we had an obligation to listen to
the public and that didn't happen,'' said Deputy Mayor Barbara Baguley.

Mayor Brian Jackson objected to the vote taking place before the results
of a telephone poll of residents on the issue are released Oct. 15.
''The process wasn't to my liking,'' said Jackson, who voted against the
proposal.

Pring's motion allows council to reconsider its decision should the poll
indicate strong opposition to the plant, which would burn up to 550,000
tonnes of garbage a year - about 470,000 shipped from Toronto and 80,000
produced locally.

Toronto recently approved a plan to seek ways to dispose of its waste
after the Keele Valley landfill site closes in 2002.

The council will report the town's support at Simcoe County Council's
meeting when Agra Birwelco, the company that proposed the plant, makes a
presentation. Agra needs the county's approval to proceed.

The decision outraged resident Euan Ferguson. ''We will not stand still
and let them do this to us; the procedure was incorrect. We'll go the
OMB, and the county and start a class-action suit.'' (The Toronto Star
9-28-1999)


KUTAK ROCK: Law Firm Sued By Schools In Penn Over Fraud In Investments
----------------------------------------------------------------------
A former junior associate at a national law firm, along with the firm's
more than 100 partners, are defendants in a $ 70 million class action
filed by a Philadelphia law firm on behalf of dozens of Pennsylvania
school districts.

The lawsuit, filed by by Fox Rothschild O'Brien & Frankel, alleges that
the firm of Kutak Rock participated with a Pennsylvania investment
adviser in victimizing school districts and municipalities through a
massive Ponzi scheme. The investment adviser, John Gardner Black, had
retained the Washington, D.C., office of Kutak Rock to act as legal
counsel and to draft investment agreements and other documents used in
the alleged fraud, according to the lawsuit. "I found out that the Kutak
Rock attorney doing the primary work and supplying the legal advice was
only a couple years out of law school," said David A. Gradwohl of Fox
Rothschild. "The documents do not indicate that he was being supervised,
although perhaps he was being orally supervised," said Gradwohl, a
commercial litigator at Fox Rothschild's Lansdale office. The junior
associate is no longer employed with Kutak Rock.

Gradwohl filed the class action last Friday on behalf of named class
representative Daniel Boone Area School District in Berks County. Both
the law firm and the investment adviser received compensation based on a
percentage of the amounts invested by the school districts and
municipalities. The Berks County School District alone invested $ 18
million with Black. "They lost $ 10 million of the $ 70 million that is
the subject matter of this lawsuit," said Gradwohl, whose firm serves as
the school district's solicitor. The lawsuit does not name Black as a
defendant.

Black, who was based in Tyrone, Pa., already faces several lawsuits,
including a separate class action. The Fox Rothschild lawsuit is the
first class action filed against Kutak Rock. Toni Allen, administrative
manager of human resources at Kutak Rock's Washington, D.C., office, was
unavailable for comment.

The 57-page complaint alleges that Kutak Rock was either aware of or
consciously disregarded misrepresentations of facts when preparing
paperwork for Black. Specifically, the class action's allegations
against Kutak Rock include counts of negligent misrepresentation, fraud,
aiding and abetting a fraud, aiding and abetting a breach of fiduciary
duty, civil conspiracy and violation of the Pennsylvania Securities Act.
Black solicited business through his companies, Devon Capital Management
and Financial Management Services. "He invested the money the school
districts gave to him in investments that he selected," said Gradwohl.
"He was supposed to only invest in investments authorized by the
Pennsylvania School Code, but he did not do that." Kutak Rock's
involvement was that Kutak Rock advised him of the legality of what he
was doing and also prepared all the documents, including the agreements
which Daniel Boone School District signed with" Black's companies,
Gradwohl said.

The action was filed last Friday in Blair County, where there are a
number of other lawsuits pending against Black, MidState Bank and others
involved in the allegedly illegal investments. Kutak Rock, according to
its Web site, has more than 250 lawyers in 13 offices, including New
York and Pittsburgh. The complaint alleges that the firm's partners are
liable for the work of the junior associate "under the doctrines of
respondent superior and principal-agent and under the law of
partnerships."


OSICOM TECHNOLOGIES: Will Defend Vigorously Securities Suit In CA
-----------------------------------------------------------------
The nine purported shareholder class action cases filed in the United
States District Court for the Central District of California against the
Company and certain present and former officers and directors have been
consolidated by the court into a single case, and a consolidated
complaint was filed on August 20, 1999. The consolidated complaint
generally alleges that, during the purported class period, the
defendants made false or misleading public statements related to a
contract entered into by our Wireless Products division with a Japanese
customer which caused the price of our common stock to be artificially
inflated. The consolidated complaint asserts that the defendants'
conduct violated Sections 10(b) and 20(a) of the Securities Exchange Act
of 1934, and SEC Rule 10b-5 promulgated thereunder. The consolidated
complaint does not specify an amount of damages. We intend to defend the
consolidated complaint and any other similar lawsuits vigorously. An
unfavorable outcome in such litigation could have a material adverse
affect on our financial condition and results of operations.


PETSMART INC: Arizona Ct Grants Motion To Dismiss Securities Suit
-----------------------------------------------------------------
On January 6, 1998, the Company was served with a complaint entitled
Miller v. Parker, et al in the Federal District Court for the District
of Arizona, Phoenix Division by a putative class of investors in
PETsMART, Inc. securities. The lawsuit alleges, among other things, that
the Company and its officers and directors issued materially false
financial statements about the Company's flea and tick product
inventory, financial condition, sales and use tax obligations, and
results of operations. Several additional complaints by putative class
representatives alleging substantially the same allegations have been
filed in the District of Arizona.

On May 18, 1998, the District Court entered an order consolidating the
securities class action litigation into a single action entitled In Re
PETsMART, Inc. Securities Litigation, CIV-98-20-PHX-ROS (JBM), and
appointing lead counsel. On July 21, 1998, Plaintiff filed a
consolidated amended complaint in the District Court. The Company and
the individual defendants filed a motion to dismiss the consolidated
amended complaint, and on June 3, 1999, the Court entered an order
granting the motion to dismiss. Plaintiff's were given 60 days to amend
the complaint but did not do so. The Company filed a request that the
case be dismissed and an order dismissing the case with prejudice was
entered on September 3, 1999. The Plaintiffs will have 30 days to file a
notice of appeal. In the event of an appeal, the Company intends to
oppose it vigorously.

PETsMART operates superstores specializing in pet food, supplies and
services in North America and the United Kingdom. At August 1, 1999, the
Company operated 571 superstores, consisting of 456 superstores in the
United States, 95 superstores in the United Kingdom, and 20 superstores
in Canada. PETsMART's store base has grown rapidly since the Company's
inception in 1986 through the opening of new stores and through the
acquisitions of PETZAZZ in March 1994, Petstuff in June 1995, Pet Food
Giant in September 1995, and Pet City in December 1996.

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


PETSMART INC: Trial On FLSA Case In Florida Scheduled For Dec 1, 1999
---------------------------------------------------------------------
On March 28, 1998, a lawsuit was filed in Federal District Court in the
Middle District of Florida entitled Cavucci et al v PETsMART, Inc. (Case
No 98-CV-340). This class-action complaint alleges unspecified damages
based on various alleged violations of the Fair Labor Standards Act
(FLSA), including alleged failures to pay overtime premiums. On May 12,
1998, the Company answered the complaint denying all material
allegations.

The court entered an order of procedure and schedule for trial on July
20, 1998, which outlines all discovery and trial dates. On November 30,
1998, PETsMART filed four motions for partial summary judgment on
Plaintiffs claim that four in-store management positions were improperly
classified as exempt under FLSA. These motions were denied. On or about
July 30, 1999, Plaintiffs filed a motion seeking Class Certification and
Court-Supervised Notice to Potential Collective Action Members. The
Company opposed the motion and the Court has the matter under review.
Trial on this matter is currently scheduled for December 1, 1999, and
the Company intends to continue to defend itself vigorously.


PRUDENTIAL INSURANCE: Judge Sanctions Attorney In Sales Practices Suit
----------------------------------------------------------------------
A federal judge in Newark has approved sanctions against a Pittsburgh
attorney whose efforts on behalf of a small number of plaintiffs delayed
settlement of the mammoth sales-practices litigation against Prudential
Insurance Co.

Calling the lawyer's behavior "impracticable, hyper- technical and
unreasonable," U.S. District Judge William Walls said that Michael
Malakoff had "abused the privileges of practicing before this court."
"His behavior since his arrival on the scene in this litigation has been
deplorable," Walls wrote in a Sept. 14 opinion, affirming an earlier
ruling by U.S. Magistrate Judge Joel Pisano. "Examples of this conduct
are numerous and not a one-time lapse of judgment."

Malakoff, of Pittsburgh's Malakoff Doyle & Finberg, represented
plaintiffs in the Prudential Insurance Company of America Sales
Practices Litigation, 95-4704 MDL No. 1061. Under an agreement forged
last year, 8 million policyholders, who engaged in 10.7 million
transactions during a 14-year period, were eligible for cash awards or
reimbursement in the form of enhanced policies.

The settlement, which Prudential says will cost $2.5 billion, was
fashioned by U.S. District Judge Alfred Wolin and affirmed by the Third
U.S. Circuit Court of Appeals and the U.S. Supreme Court over Malakoff's
objections, including an unsuccessful recusal motion against Wolin.

In his certiorari petition to the U.S. Supreme Court, Malakoff argued
that the class created by Wolin did not adequately represent all
policyholders who might have been defrauded. He further asserted that
the settlement violated the principles of Amchem Products Inc. v.
Windsor, 117 S. Ct. 2231 (1997), in which the Supreme Court frowned on
the certification of overbroad national class actions. But on Jan. 11,
the U.S. Supreme Court refused to grant certiorari.

Pisano had recommended that Malakoff pay $100,000 in sanctions under 28
U.S.C. 1927 to lead plaintiffs' counsel Melvin Weiss for frivolous
claims that delayed the case. Walls noted Pisano had failed to itemize
the fees and costs associated with those claims and remanded for that
purpose, though he observed that the $100,000 probably "falls short of
the value of the work" Malakoff caused for Weiss, of New York's Milberg
Weiss Bershad Hynes & Lerach.

Walls also approved Pisano's recommendation that Malakoff be barred from
being admitted pro hac vice in New Jersey if he is sanctioned again in
the next five years.

Malakoff says he will appeal to the Third Circuit.

In July, when Pisano recommended the sanctions, Malakoff called the fine
excessive, considering that Prudential was sanctioned only $1 million
for allowing documents to be destroyed in the case. "To fine me 10
percent of what an $18 billion corporation is fined is grossly out of
line," Malakoff said.

Malakoff says the objections for which he was sanctioned were made to
get as much money as he could for as many people as possible, in
particular 9 million policyholders who did not submit claims but were
affected by Prudential's illegal sales practices from 1982 to 1995. The
settlement ended up covering 1.8 million plaintiffs in federal court.

Malakoff first lodged his opposition to the way the case was handled
when all the suits were consolidated in Wolin's court in 1996. Malakoff,
who says the cases should have been handled in individual state courts,
represented 20 plaintiffs who filed suits in state courts in West
Virginia and Ohio.

Malakoff also objected when Weiss began to arrange the settlement with
Wolin and Prudential in 1996. Malakoff, who was not included in the
discussions, filed a motion to recuse Wolin because, he alleged, the
judge engaged in unauthorized ex parte communications with Weiss. Wolin
denied the motion in December 1996, and the Third Circuit later agreed.

Weiss then filed for sanctions against Malakoff under 28 U.S.C. 1927,
which calls for penalties if an attorney causes unnecessary work for an
adversary.

In March 1997, Malakoff filed a similar motion against Weiss, arguing
that Weiss' petition for sanctions against him were frivolous. A month
later, Malakoff filed a second petition for sanctions against Weiss,
this one under Rule 11. The Third Circuit denied both petitions.

Malakoff didn't stop there. When Weiss moved for a $48 million fee award
in November 1998, Malakoff opposed the request. Weiss moved for Rule 11
sanctions; in response, Malakoff moved for Rule 11 sanctions against
Weiss.

Weiss withdrew his motion for sanctions in January because he said he
didn't want to hold up the settlement. But Malakoff filed his fourth
request for sanctions against Weiss, alleging that the lead counsel
violated 28 U.S.C. 1927 in his response brief to Malakoff's previous
request for sanctions.

In July, Pisano recommended sanctions under the federal statute against
Malakoff, who argued that his motions had "a colorable basis in fact"
and were not filed in bad faith.

Pisano found that Malakoff's complaints against Weiss had no basis and
were nothing more than sour grapes. He also said that any reasonable
attorney would have understood that Wolin could engage in ex parte
communications in a complex class action.

Pisano also concluded that Malakoff's conduct showed a "pattern of
obfuscation and mean-spiritedness." As an example, Pisano said, Malakoff
moved in January 1997 for the disqualification of a fee examiner after
having approved the examiner three months earlier. When Wolin denied the
petition, Malakoff took his objection to the Third Circuit, which also
denied it.

Pisano said Malakoff repeatedly hurt Wolin's management of the case. In
February 1997, Malakoff sought to review documents in the case and,
instead of going to another attorney's office to read through the
papers, demanded that parties give him charts summarizing the evidence.

Pisano said, "Mr. Malakoff's incessant struggle with attorneys and this
Court caused colossal time delays and monumental obstacles to the
orderly settlement of the action."

Walls stepped in to decide Malakoff's appeal of Pisano's decision when
Wolin was conflicted out because some of the objections were directed at
him. He said Malakoff's resistance to discovery delayed the case and
warranted sanctions. Malakoff's conduct shows "evidence of vexatious
litigation tactics and bad faith," Walls said. It is clear, he
concluded, that Malakoff "takes an impracticable, hyper-technical and
unreasonable approach to litigation."


STEWART ENTERPRISES: Kohn, Swift Files Securities Suit In Louisiana
-------------------------------------------------------------------
The following is an announcement by the law firm of Kohn, Swift & Graf,
P.C.

Notice is hereby given that a class action lawsuit was filed in the
United States District Court for the Eastern District of Louisiana on
behalf of purchasers of Stewart Enterprises, Inc. (Nasdaq: STEI) common
stock between December 15, 1998 and August 12, 1999.

The complaint charges Stewart and certain of its officers and directors
with violations of the federal securities laws. Among other things,
plaintiff claims that the defendants issued materially false and
misleading statements regarding the impact that negative trends in the
death care industry were having on Stewart. If you purchased Stewart
common stock between December 15, 1998 and August 12, 1999, and are a
member of the class described above, you may, not later than October 22,
1999, move the court to serve as lead plaintiff of the class, if you so
choose. In order to serve as lead plaintiff, however, you must meet
certain legal requirements. If you wish to discuss this action, or have
any questions concerning this notice or your rights or interests, please

Contact Michael J. Boni, Esq. Kohn, Swift & Graf, P.C. 1101 Market
Street Suite 2400 Philadelphia, PA 19107 (800) 275-4014 or (215)
238-1700 Email: mboni@kohnswift.com TICKERS: NASDAQ:STEI with your
telephone number and mailing address included.


SYSTEM SOFTWARE: Illinois Appellate Ct Affirms Settlement For Suits
-------------------------------------------------------------------
In January 1997, class actions lawsuits against System Software
Associates Inc. and certain of its officers were filed in state court in
Illinois and in the federal court in Chicago, Illinois. The Company
executed a settlement agreement with the class plaintiffs in the
Illinois state court action. The presiding judge in the Illinois case
approved the settlement on September 30, 1997. Certain individual
objectors to the Settlement appealed the fairness of the settlement.

On June 18, 1999, the Illinois Appellate Court affirmed the settlement
of the state court class action. Plaintiffs did not seek leave to appeal
to the Illinois Supreme Court. Accordingly, the state court action has
concluded. The Company has filed a motion to dismiss in the Federal
action, arguing that the claims in Federal court have already been
settled in state court and are barred by the doctrine of res judicata.
That motion is pending.


* How Local Congress Members Voted On Gun Suits And Tobacco Suits

Here's how some major bills fared recently in Congress and how local
Congress members voted, as provided by Thomas' Roll Call Report
Syndicate. NV means Not Voting.

                              GUN SUITS

For: 152 / Against: 277

The House rejected an amendment that sought to exempt suits against gun
and ammunition manufacturers from a bill that shifts most class-action
suits to federal courts.

A yes vote was to keep existing class-action rules for gun suits.

MARYLAND

Yes No NV

Bartlett (R) *

Cardin (D) *

Ehrlich (R) *

Gilchrest (R) *

Hoyer (D) *

Cummings (D) *

Morella (R) *

Wynn (D) *


VIRGINIA

Yes No NV

Davis (R) *

Moran (D) *

Wolf (R) *

Bateman (R) *

Bliley (R) *


                             TOBACCO SUITS

For: 162 / Against: 266

The House rejected an amendment to exempt cases against tobacco
companies from a bill that would give federal courts jurisdiction over
most future class-action suits.

A yes vote was to retain state courts as the main venue for class
actions against tobacco firms.

MARYLAND

Yes No NV

Bartlett (R) *

Cardin (D) *

Ehrlich (R) *

Gilchrest (R) *

Hoyer (D) *

Cummings (D) *

Morella (R) *

Wynn (D) *


VIRGINIA

Yes No NV

Davis (R) *

Moran (D) *

Wolf (R) *

Bateman (R) *

Bliley (R) *


                                *********


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.  Theresa Cheuk and Peter A. Chapman, editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The CAR subscription rate is $575 for six months delivered via e-mail.

Additional e-mail subscriptions for members of the same firm for the
term of the initial subscription or balance thereof are $25 each.  For
subscription information, contact Christopher Beard at 301/951-6400.


                     * * *  End of Transmission  * * *