/raid1/www/Hosts/bankrupt/CAR_Public/991011.MBX                C L A S S   A C T I O N   R E P O R T E R

               Monday, October 11, 1999, Vol. 1, No. 174


AHP: Judge Passes Norplant Cases Settlement On To Attorneys
ALZA CORP: Wolf Popper Files Securities Suit In Illinois
AUTO INSURANCE: AAIA Says State Farm Ruling Inspires Consumer Choice
AUTO INSURANCE: State Farm Verdict A Victory For Car Owners, Paper Says
AUTO INSURANCE: State Farm Suspends Use Of Repair Parts Upon Verdict

AUTO INSURANCE: State Farm Verdict Totally Nears $1.2B On Fraud Finding
AVIATION SALES: Finkelstein & Krinsk File Securities Suit In Florida
COCA-COLA: Lawyers For Both Sides Dispute Fiercely Over Paper Shredding
FEN-PHEN: AHP Announces Diet Drug Settlement Plan
FEN-PHEN: Papers Report On AHP $3.75 Bil Settlement; Approval Pending

FEN-PHEN: Charfoos & Christensen Talks About AHP Settlement For MI
FEN-PHEN: Frequently Asked Questions And Answers On AHP Settlement
FEN-PHEN: More than 100,000 From Washington Can Share In Settlement
GREAT WESTERN: Hanzman, Criden Announces Settlement Of Securities Suit
HEALTHSOUTH CORP: Acquired Horizon/CMS Faces N.Y. Securities Suits

HEALTHSOUTH CORP: Decries Merit Of Securities Suits In Alabama
HEALTHSOUTH CORP: Horizon Contests Carolina Suit Re Communi-Care Stock
HEALTHSOUTH CORP: Horizon Faces EEOC Litigation Re Pregnancies
HEALTHSOUTH CORP: Horizon Faces MI Criminal Case Re Nursing Facilities
HMO: Aetna Faces Another Class Action Over Secret Contracts with MDs

HMO: Aetna Faces National Suit Charging RICO, ERISA Violations
HOLOCAUST VICTIMS: Nazi Slave Laborers Want $10 Bil Pay-Off
HOLOCAUST VICTIMS: Schroeder Defends $3.3 Bil German Offer To Fund
MATTEL INC: Savett Frutkin Files Securities Suit In California
REPUBLIC NY: Shalov Stone Files Securities Suit In Penn

SABRATEK CORP: Milberg To File 2nd Amended Securities Complaint In Ill.
TOBACCO LIITGATION: Industry Brings In Big Name For Next Phase Of Case
UNISTAR FINANCIAL: TX Securities Fraud Case Assigned to Judge Fitzwater
WICKES INC: Defends Vigorously Some Asbestos Suits In MI, Settles Some
WICKES INC: Faces Securities Suit In Del. Over Unfair Sale Of Shares

WICKES INC: Sued Over Health Problems Caused By Silica Dust

* Bill Boosting Patient Rights Okayed By House
* Blue Cross Issues Statement On Patients Bill Of Rights
* CNN Coverage On the Patients’ Bill of Rights Passed on Oct. 7, 1999


AHP: Judge Passes Norplant Cases Settlement On To Attorneys
Despite repeated assertions that it would not pay a penny to any former
Norplant users, American Home Products Corp. (AHP) has made a business
decision to settle cases with at least 36,000 women. Announced on Aug.
26, the settlement, which could exceed $ 50 million, would end five
years of litigation for the company, which is now embroiled in a
multitude of lawsuits regarding its diet drug, Fen-Phen. In re Norplant
Contraceptive Product Liability Litigation, D.C., Texas, MDL No. 1038.

Even though it has won three jury verdicts, 20 pretrial judgments and
the dismissal of 14,000 claims, AHP decided that its legal success was
not worth the cost. The settlement would pay $ 1,500 to each woman who
filed a claim before March 1, 1999. Consequently, if every former user
accepts the settlement, AHP could pay up to $ 75 million. Attorney' fees
would be deducted from each woman's recovery.

Turner Branch, co-chairman of the plaintiffs' steering committee, would
not comment on the settlement except to confirm the basic details and to
confirm that as many as 50,000 women might be eligible to participate.

Blair Hahn of Ness, Motley in Charleston, S.C., said the firm is
recommending that the majority of their clients accept the settlement.
Only those who have suffered injuries which plaintiff's lawyers allege
can be directly associated with Norplant, such as a stroke or blindness
caused by the build up of pressure around the optic nerve, are being
counseled to go to trial. Another member of the firm confirmed the
difficulty in winning Norplant cases, saying that out of the three cases
taken to trial, only one was successful.

The judge overseeing the Norplant litigation, U.S. District Judge
Richard A. Schell, passed the settlement on to all the attorneys in the
cases. Judge Schell denied a request for class-action status and
dismissed five cases before trial. Other state court lawsuits have
either been dismissed or withdrawn. Only four cases have gone to trial,
three of which were in Texas. (Medical Legal Aspects of Breast Implants,
September 1999)

ALZA CORP: Wolf Popper Files Securities Suit In Illinois
Notice is hereby given that a class action lawsuit has been filed in the
United States District Court for the Northern District of Illinois by
Wolf Popper LLP on behalf of all owners of ALZA Corp. common stock as of
August 16, 1999, the record date for the vote on approval of a proposed
merger between ALZA and Abbott Laboratories. Named as defendants are
Abbott (NYSE: ABT), ALZA (NYSE: AZA), and the Chairmen of the two
respective corporations.

The Complaint charges that defendants violated the U.S. securities laws
by failing to inform ALZA shareholders, in connection with the
shareholder vote on the proposed merger, of material facts concerning
Abbott's continuing negotiations on the terms of a consent order with
the Food and Drug Administration ("FDA") to resolve FDA allegations that
Abbott's Lake County, Illinois Diagnostic Division manufacturing
facilities are not in compliance with federal regulations. Following the
vote, Abbott disclosed, among other things, that if the "discussions
concerning the consent decree are not successful, the government has
advised the company that it will file a complaint for injunctive relief
which would include the cessation of manufacturing and sale for a period
of time of a number of diagnostic products." Abbott's Diagnostics
Division accounted for about 22 percent, or $2.79 billion, of Abbott's
total sales in 1998.

Abbott announced these continuing difficulties with the FDA after the
close of U.S. securities markets on September 28, 1999, just seven days
after ALZA's shareholders approved the merger. As a result of the
disclosures, Abbott stock, which had been trading at $43.00 per share at
the time of the September 21, 1999 merger vote, fell to close at $37.50
on September 29, 1999. ALZA common stock, which had been trading at
$50.25 as of the date of the merger vote, also declined to close at
$43.625 per share on September 29, 1999.

Any member of the proposed class who desires to be appointed lead
plaintiff in this action must file a motion with the Court no later than
sixty (60) days from October 7, 1999. Class members must meet certain
legal requirements to serve as a lead plaintiff. If you have questions
or information regarding this action, or if you are interested in
serving as a lead plaintiff in this action, you may call or write:
Robert C. Finkel, Esq. or Kent A. Bronson, Esq. WOLF POPPER LLP 845
Third Avenue New York, NY 10022-6689 Telephone: 212-451-9620
212-451-9629 Toll Free: 877-370-7703 Facsimile: 212-486-2093 E-Mail:
rfinkel@wolfpopper.com or kbronson@wolfpopper.com Web site:

AUTO INSURANCE: AAIA Says State Farm Ruling Inspires Consumer Choice
The Automotive Aftermarket Industry Association (AAIA) expects that the
recent $456 million verdict against State Farm Mutual Automobile
Insurance Company will give consumers greater choice by forcing
insurance companies to disclose to policyholders the types of autobody
repair parts covered.

"Whether it's health insurance, home owners insurance or car insurance,
the consumer should know up-front specifically what is covered," said
Gene Gardner, AAIA president. "When a car owner is in an accident, he or
she should have a choice in what type of fender, hood, trunk lid or
other exterior sheet metal is used to repair their vehicle."

"By choice we mean the car owner should have the option of purchasing
the appropriately priced part for their vehicle based on its age, value
and condition whether the part is manufactured by the original car maker
or by an independent company," said Gardner.

A jury Monday awarded $456 million to policy holders of State Farm
insurance company in a class action suit for its practice of encouraging
policyholders to use non-original equipment auto body parts.

AAIA, the trade association representing every segment of the $264
billion automotive aftermarket, cautions, however, that reports about
the class action lawsuit are misleading consumers.

"Sheet metal parts used to manufacturer body parts to replace parts
damaged in an accident account for only a fraction of the aftermarket
industry," said Gardner. "Reports on this court decision that reference
aftermarket parts in general are inaUrmrate and unfair."

Sheet metal parts represent only 1.8 percent of the aftermarket and are
typically sold through collisile manufacturers themselves and many
aftermarket parts are made by the same companies who make parts for the
automakers which are sold in new car dealerships," explained Gardner.

The Automotive Aftermarket Industry Association (AAIA) is a Bethesda,
Md.- based association whose member companies manufacture, distribute
and sell motor vehicle parts, accessories, tools, equipment, materials
and supplies. The organization is comprised of manufacturers,
distributors, jobbers, wholesalers, retailers, manufacturer's
representatives, and other companies doing business in the automotive
aftermarket. AAIA formerly served the automotive aftermarket as APAA and

AUTO INSURANCE: State Farm Verdict A Victory For Car Owners, Paper Says
A southern Illinois jury's decision in a class-action suit ordering
State Farm to pay $ 456 million to 4.7 million customers is a victory
for all automobile owners. It should help stop the popular practice of
using "aftermarket" car parts for repairs at the request, or demand, of
insurance companies.

"Aftermarket" car parts are modeled on original factory-produced car
hoods, fenders or other auto parts but are not made to factory
specifications. Insurance companies say they use these Brand X car parts
to reduce repair costs and pass the savings on to consumers through
lower premiums. Consider it managed-care for cars. Competition among
insurers to provide the best rates spurs the parts' widespread use.

But customers have complained that the generic parts don't look as good
or work as well as the genuine article. Mechanics gripe that the
generics require more labor to install. The jury decided State Farm
breached its contracts with its customers by requiring replacement parts
that did not return cars to their "pre-loss condition." At least 13
similar lawsuits are pending against Allstate, Geico, Nationwide, USAA,
Progressive, Metropolitan and Farmers Group.

One juror in the State Farm case said his decision was pretty easy to
make, especially after seeing more than a dozen memos in which the
company's own executives questioned the quality of generic products the
company pushed as high-quality alternatives.

The industry already has begun intoning the same, worn-out mantra:
Class-action suits benefit only greedy trial attorneys. It is an ironic
charge coming from an industry that brought this on itself by pushing,
and even mandating, the use of inferior products. State Farm still
refuses to get the message, and the company insists on waiting to see if
the verdict is upheld on appeal before it stops using generic parts.

It's true that most of the policyholders in the suit would only get
about $ 100 . But that is beside the point: The satisfaction alone could
help reduce road rage.

The award should also serve as a warning shot across the bow to other
insurance companies that they should disclose in writing and in advance
whether brand name or generic car parts will be used in repairs. If
customers want generic car parts, they should be able to choose that
option, much as they do with brand name vs. generic drugs. Policyholders
have a right to know what their coverage covers -- before they sign on
the dotted line. (St. Louis Post-Dispatch 10-8-1999)

AUTO INSURANCE: State Farm Suspends Use Of Repair Parts Upon Verdict
State Farm, the nation's largest auto insurer, suspended its use of
generic replacement parts after a jury awarded $456 million to
policyholders in a class-action lawsuit. ''We thought to try to dispel
some of this confusion or concern it would be best to temporarily
suspend use of 'aftermarket' crash parts,'' State Farm spokesman Dave
Hurst said.

The jury found that State Farm's use of aftermarket parts breached the
insurer's contract to restore vehicles to their pre-accident condition.
Such parts resemble brand-name replacement parts but are made without
access to automakers' factory specifications. Critics say they do not
provide the same level of fit, finish, corrosion resistance and, in some
cases, safety, as regular replacement parts.

A judge is considering a second count of the lawsuit: whether State Farm
committed fraud by not telling consumers what sort of parts it was
requiring body shops to use.

Hurst said the company's announcement last Thursday was not related to
the impending ruling. State Farm won't charge its policyholders extra
and their premiums won't be increased, he said.

About 10 percent of parts used in State Farm repairs have been from
aftermarket manufacturers, the insurer said.

Kirk Hansen, a spokesman for the trade group Alliance of American
Insurers, said he expected other companies would follow State Farm's
lead. (AP Online 10-8-1999)

AUTO INSURANCE: State Farm Verdict Totally Nears $1.2B On Fraud Finding
State Farm, already reeling from a $456 million judgment earlier this
week, was ordered to pay an additional $730 million in damages for using
generic replacement parts to restore customers' cars to pre-accident
condition. Williamson County Circuit Judge John Speroni found last
Friday that State Farm had deliberately deceived its customers about the
quality of aftermarket parts, modeled on manufacturers' originals but
made without access to factory specifications. Critics say they are not
as good as those made for automakers.

In total, State Farm, the nation's largest auto insurer, has been socked
with a nearly $1.2 billion judgment over its policy on auto-body repair

But lawyers representing State Farm policyholders said the monetary
award is secondary to the class action lawsuit's primary goal: to expose
State Farm's practices. "Sometimes, getting a large corporation
financially is not as important as exposing their fraud," said lawyer
Patricia Littleton. "That's the best part of this whole case -- they've
been exposed."

State Farm chairman and CEO Edward Rust Jr. promised an appeal of both
verdicts and said the company was "astonished" by last Friday's
decision. The $456 million decision last Monday on a breach-of-contract
claim was already considered to be the largest ever against an insurer.

Speroni said State Farm violated its trust with 4.7 million
policyholders by deliberately adopting a term he called misleading --
"quality replacement parts" -- to refer to aftermarket parts. Speroni
awarded $130 million to policyholders in compensation for the savings
State Farm realized by its use of aftermarket parts. A $600 million
punitive damages award was intended to deter State Farm from continuing
deceiving its customers about the parts, the judge said.

Current and former policyholders who could have claims against the
company would get an average of $100 each under the breach-of-contract
judgment. It was unclear how many plaintiffs are affected by the
consumer fraud judgment, or what their average share would be.

Rust said the consumer-fraud finding was particularly troubling because
State Farm abides by regulations on use of aftermarket parts in every
state where it does business. "Now it's been decided that by abiding by
those regulations we have violated the law," he said at a news
conference at the company's headquarters in Bloomington. "That just
doesn't make sense."

At least seven other insurers are facing similar claims in at least 13
lawsuits filed around the country. Industry analysts said it was unclear
whether other companies might suspend use of aftermarket parts. But
Steve Goldstein, a spokesman for the Insurance Information Institute,
the nonprofit communications arm of the insurance industry, said none of
the major insurers so far have indicated they had any plans to change
their policies.

State Farm and insurance industry groups say the move to suspend use of
aftermarket parts will result in higher premiums and higher repair costs
if allowed to stand. The insurance industry offered scathing criticism
of the ruling. "I think this is not a good day for anybody but a handful
of plaintiff lawyers and major stockholders in the three major car
companies," said Kirk Hansen, director of claims for the Alliance of
American Insurers, a trade association.

State Farm told its policyholders that parts used by the company are
certified by an independent testing agency, meet high quality standards
and meet the company's contractual obligation to restore a car to its
pre-accident condition using parts of "like kind and quality."

But in a 1997 memo introduced as evidence, a State Farm executive wrote,
"We may well say it is like kind and quality, but the bottom line is
that it is not the same." (Associated Press by way of Newshound)

AVIATION SALES: Finkelstein & Krinsk File Securities Suit In Florida
Aviation Sales Co. (NYSE:AVS) is accused in a class-action lawsuit of
fraudulently misrepresenting the company's condition and business
prospects in order to inflate the price of the company's stock.

When AVS finally revealed its true condition on Saturday, Sept. 18,
1999, the share price plummeted 36% the following Monday from $ 29-3/8
per share on Sept. 16, 1999, to $ 18-11/16 per share. During the Class
Period (June 11, 1999, through Sept. 17, 1999), the price per share was
as high as $ 43-15/16 due to defendants' artificial inflation of AVS

The Complaint has been filed in U.S. District Court for the Southern
District of Florida and represents a class comprised of all individual
and institutional investors for the pertinent time period.

According to the Complaint filed by Finkelstein & Krinsk, executives of
AVS painted a falsely positive picture of the company by deliberately
withholding facts from the public that, amongst other things, the
company's maintenance, repair and overhaul unit would not meet
expectations, demand for AVS's services was weakening, and it would be
unable to sell or lease certain aircraft, which would materially
decrease revenues and increase inventory costs. The Complaint
particularizes plaintiff's allegations of how AVS management violated
the Securities Exchange Act of 1934 and specifies the company's false
statements and omitted material facts.

"AVS executives knew their business was deteriorating and that the only
way to maintain their lavish compensation and other emoluments was to
deliberately conceal the truth from investors," stated Jeffrey R.
Krinsk, Esq., of Finkelstein and Krinsk. "We are particularly pleased
that investors have contacted us as we are recognized as the resource of
choice for large investors who appreciate the quality of our research
and our willingness to include their own attorneys in the process,
reflecting our flexible approach." Finkelstein & Krinsk has been
retained by AVS shareholders to recover losses for the Class Period.

If you purchased or acquired a significant amount of AVS stock during
the Class Period, you can join in the action on favorable terms without
cost or expense to you. Members of the Class who wish to participate
must act by not later than Nov. 22, 1999, and should contact Finkelstein
& Krinsk. Contact: Jeffrey R. Krinsk at Finkelstein & Krinsk, the Koll
Center, 501 West Broadway, Suite 1250, San Diego, Calif. 92101; call
toll-free 877/493-5366 or fax 619/238-5425 or e-mail
fk@class-action-law.com TICKERS: NYSE:AVS

COCA-COLA: Lawyers For Both Sides Dispute Fiercely Over Paper Shredding
Were documents destroyed or weren't they? And if so, did they contain
relevant information in the racial discrimination suit against
Coca-Cola? Those two questions are at the heart of a fiercely contested
dispute between the lawyers for both sides, with the plaintiffs'
attorneys firing the latest shot.

The issue goes to the very core of each side's credibility. In fact,
each side already has asked the federal judge in the case to punish its
opponent for making misleading statements to the court.

Coca-Cola, which denies it has discriminated against African-American
employees, insists it has not shredded relevant documents in the case.

The plaintiffs' attorneys, however, said in another legal filing that
Coca-Cola's own documents, including internal memos and an invoice, show
the following:

   * The company planned to place a "heavy duty, commercial strength"
     paper shredder in a special room it was organizing to collect data
     for the suit.
   * The company "specifically planned to shred a large volume of paper
     with this machine."
   * The company's litigation department "purchased shredders almost
     immediately after plaintiffs filed their class-action claims" on
     April 22.
   * The litigation department has in fact shredded material connected
     to the suit. The plaintiffs added, however, that they do not know
     if relevant material was destroyed.
   * Finally, the company has targeted numerous documents for
     destruction. In this case, plaintiffs' attorneys alleged, the
     information would not be destroyed by shredding, but by
     disintegration in a confidential refuse disposal system.

Coca-Cola emphatically disputes these contentions, arguing that the
plaintiffs' attorneys are deliberately misinterpreting what the
documents show. "This is completely irresponsible of plaintiffs'
counsel," company spokesman Ben Deutsch said. "First of all, there has
never been a shredder in our data collection room, and our evidence
strongly supports that," Deutsch said. "Secondly, and most importantly,
we have never destroyed any discoverable documents or data, period."

The company also said it set up the data room to compile a huge volume
of employment information that the plaintiffs are legally entitled to.
While the company said it once considered the idea of using shredders in
that room, it also said it immediately vetoed that idea. Instead, the
company said, it decided to discard miscopies and extra copies of
confidential documents in special refuse bins. The company said those
bins have never been emptied of those documents, so the information has
never been destroyed.

The company said one of its attorneys purchased a shredder for his
office. But, the attorney said he has never shredded any "documentation
to which plaintiffs in this litigation would even arguably be entitled."
The lawyer said he is using the shredder to "dispose of duplicate copies
of correspondence to and from our outside counsel, drafts of pleadings
and other court papers submitted in this case, and privileged internal
litigation strategy memoranda."

Perhaps this issue would have been a considerably smaller one had the
company mentioned at an earlier opportunity that it once considered
using shredders in its data room and that one of its attorneys purchased
a shredder for his office.

Initially, the plaintiffs raised the shredding issue with the court
after receiving an anonymous June 14 letter saying there were shredders
in "a document destruction room." In response, a company attorney wrote
a June 23 letter to U.S. District Judge Richard Story saying that there
are no shredders in the room and that no data are being destroyed.

Deutsch said that letter was a "full and accurate response" to the issue
the plaintiffs' attorneys raised at the time. But the plaintiffs
disagree. "Particularly troubling is Coca-Cola's failure to reveal its
purchase and use of a shredder in response to the anonymous letter,"
plaintiffs' attorneys wrote. It was only after they continued to pursue
the matter did that information come out, the plaintiffs said.

The judge will now weigh all this conflicting information before ruling
on the issue.

Four current and former employees allege that Coca-Cola has
discriminated against African-American employees in pay, promotions and
performance evaluations. The plaintiffs are seeking class-action status
to represent 1, 500 other black salaried employees in the United States.
(The Atlanta Journal and Constitution 10-7-1999)

FEN-PHEN: AHP Announces Diet Drug Settlement Plan
American Home Products Corporation (NYSE: AHP) announced a
comprehensive, national settlement to resolve litigation against the
Company brought by people who used Redux(TM) (dexfenfluramine) or
Pondimin(R) (fenfluramine).

This nationwide, class action settlement is open to all Redux or
Pondimin users in the U.S., regardless of whether they have lawsuits
pending. It offers a range of benefits depending on a participant's
particular circumstances, including: a refund program for the cost of
the drugs; medical screening; additional medical services or cash
payments; and substantial compensation in the event of serious heart
valve problems.

Additional details are provided in the attached summary.

"This settlement provides fair and equitable terms for both diet drug
claimants and American Home Products," said John R. Stafford, Chairman,
President and Chief Executive Officer. The agreement was developed by
attorneys for the Company and by plaintiffs' attorneys involved in
various federal and state cases.

"Settling this matter was in the best interest of those who used
Pondimin or Redux as well as of the company," said Mr. Stafford. "We
believe that this agreement is a sound way to resolve the claims raised
by diet drug users and represents a prudent course for our company. It
offers peace of mind to those who used the drugs and permits the company
to move beyond the uncertainty and distractions of litigation." "We
agreed to this settlement so that we can focus on the business of making
innovative pharmaceutical products. Today, we have in our research
pipeline products to help solve some of the world's most pressing health
problems and this settlement allows us to pursue and expand that
effort," said Mr. Stafford.

"In designing the agreement with the plaintiffs' attorneys, we wanted to
ensure that the benefits are attractive to the claimants and provide a
strong incentive for participation," said Louis L. Hoynes, Jr., Senior
Vice President and General Counsel for American Home Products. "We are
confident that well-informed claimants will conclude that the range of
benefits of this settlement is preferable to lengthy and uncertain
litigation. The scientific studies conducted to date and clinical
experience indicate that the health of the overwhelming majority of
people who took Redux or Pondimin has not been adversely affected. The
studies also show no increased risk of valvular heart disease among
persons who took the drugs for three months or less -- more than 75% of
those who took the drugs. Yet this settlement provides a quality package
of benefits for all individuals who used the drugs and financial
protection in the event a person should develop serious heart valve

The settlement agreement is subject to judicial approval. A judicially-
approved notice program will provide potential participants with details
regarding the settlement procedures. This will be followed by hearings
to obtain judicial approval of the settlement. Initial payments by
American Home Products into the settlement funds are anticipated to
begin later this year. Payments will continue for approximately 16 years
after final judicial approval if needed to provide settlement benefits
to members of the class. Payments to be made during the next two years
are anticipated to total $1.85 billion. In the aggregate, all payments
under the settlement cannot exceed $3.75 billion in present value.
Future payments will be made only as and if needed, and are subject to
annual maximum amounts. In addition, American Home Products will receive
credits for future payments to persons who opt out of the settlement
under certain circumstances.

The Company will record a charge of $4.75 billion pretax ($3.29 billion
after tax, equal to $2.51 per share) to provide for expected payments to
the settlement funds, other judgments and settlements, and legal costs.
The charge, which is net of available insurance, will be reflected in
the 1999 third quarter financial results.

Redux and Pondimin were indicated for the treatment of obesity as part
of a broader weight management program, including diet and exercise. On
September 15, 1997, Wyeth-Ayerst Laboratories, the pharmaceutical
division of American Home Products, voluntarily withdrew Redux and
Pondimin from the market after the FDA presented to the Company new and
preliminary information about possible heart valve abnormalities in some
patients using these products. More recent well-controlled clinical
trials -- many of which have already been published in peer-reviewed
journals and presented at major medical meetings -- indicate that
serious heart valve disease among former diet drug users is rare and the
actual prevalence of heart valve regurgitation is far lower than was
suggested at the time of the products' withdrawal. These findings are
consistent with the clinical experience of cardiologists.

A toll-free telephone number (800-386-2070) has been established to
provide information on the settlement.


Eligibility: Open to all persons who used Pondimin or Redux for any
length of time, regardless of whether they have a lawsuit pending.

Scope: Covers all claims arising from the use of Pondimin or Redux at
any time, except for claims of Primary Pulmonary Hypertension (PPH).

Maximum Cost of Settlement: Depends on actual claims experience but will
not exceed an aggregate payment cap with a maximum present value of
$3.75 billion. Will include two separate funds. Fund A ($1 billion,
fully payable upon final judicial approval of the settlement) will cover
refunds, medical screening costs, additional medical services and cash
payments, education and research costs, and administration. Up to $200
million in additional funds will be available for attorneys' fees
related to Fund A that are judicially approved. Fund B ($650 million
payable upon final judicial approval and the remainder paid over 15
years as and if needed; maximum present value of $2.55 billion) will
compensate claimants with significant heart valve disease and pay
attorneys' fees related to Fund B that are judicially approved.

Fund A (Refunds/Screening/Medical Services or Cash/Education and

Persons who used Pondimin or Redux for more than 60 days will be offered
an echocardiogram and an interpretive visit with a physician; will, if
the echocardiogram shows FDA Positive level(1) heart valve
regurgitation, be entitled to choose either $6,000 in cash or $10,000
worth of additional medical services; and may qualify for a refund of
their prescription costs ($30/mo for Pondimin and $60/mo for Redux) up
to a $500 cap, to the extent that there are sufficient funds in Fund A.

Persons who used Pondimin or Redux for 60 days or less qualify for a
refund of their prescription costs ($30/mo for Pondimin; $60/mo for
Redux); will, if they obtain an echocardiogram on their own during a
specified screening period and if that echocardiogram shows FDA Positive
level heart valve regurgitation, be entitled to reimbursement for the
cost of the echocardiogram up to a specified amount; may apply to
receive an echocardiogram under limited compassionate and hardship
programs; and will, if an echocardiogram shows FDA Positive level heart
valve regurgitation, be entitled to choose either $3,000 in cash or
$5,000 worth of additional medical services.

An education and research fund of $25 million will be established to
sponsor additional education and research concerning heart disease.

Fund B (Compensation Program):

Class members who are diagnosed with FDA Positive level or mild mitral
regurgitation as of the end of the screening period and who register for
benefits will be eligible for additional payments in the event that --
within 14 years from final approval of the settlement (but not later
than December 31, 2015AHP1) -- they develop serious heart valve disease,
as defined in the settlement.

The amount of the payment to which a class member may be entitled may be
up to approximately $1.5 million. The amount of the payment will depend
on several factors, including the kind and degree of regurgitation at
the end of the screening program, the severity of the heart valve
condition ultimately claimed, the class member's age and other medical
conditions and the duration of drug use.

Timing of Benefits: Class members will begin to receive settlement
benefits following final judicial approval.

Accelerated Implementation Option: Claimants who would like to receive
settlement benefits sooner will be given the opportunity to participate
in a separate agreement with AHPC on the same terms as those in the
settlement, but without any option to opt out of the agreement. Benefits
under this option will become available following trial court approval
of the settlement and will be provided regardless of the outcome of any

Opt Outs: The agreement provides three opportunities to opt out of the
settlement. All claimants will have the customary opportunity to opt out
before the settlement is approved by the court. Claimants who first
learn that they are FDA Positive during the screening period will also
have an opportunity to opt out shortly thereafter. Claimants will then
have another opportunity to opt out at the time they first qualify for a
Compensation Program payment. In the latter two instances, class members
who opt out will forego the right to seek punitive damages. AHPC may
terminate the settlement at its discretion based on the number of
initial opt outs.

AHPC Payments: Initial payments into the funds are anticipated to begin
later this year and to continue for approximately 16 years after final
judicial approval, if needed. Payments to be made during the next two
years are anticipated to total $1.85 billion. In the aggregate, all
payments under the settlement cannot exceed $3.75 billion in present
value. Future payments will be made only as and if needed and are
subject to annual maximum amounts.

AHPC Credits for Payments to Opt Outs: AHPC will receive a credit
against the aggregate payment cap for payments to specified categories
of claimants who opt out. The amount of the credit will depend on the
point at which the claimant has opted out, the nature of the claimant's
alleged injuries, and the amount of the claimant's financial recovery.

"FDA Positive" level valve regurgitation means mild, moderate or severe
aortic valve regurgitation or moderate or severe mitral valve
regurgitation. These are the levels of regurgitation used by the FDA in
September 1997 to assess the possible association of regurgitation with
diet drug use. SOURCE American Home Products Corporation.

FEN-PHEN: Papers Report On AHP $3.75 Bil Settlement; Approval Pending
After weeks of intense negotiations, Madison-based American Home
Products last Thursday agreed to pay as much as $ 3.75 billion to settle
thousands of claims that its fen-phen diet drug combination caused
dangerous heart valve problems. The class-action settlement is open to
any of the 5.8 million Americans who used the drugs Redux or Pondimin,
both of which have been recalled.

The settlement would be the largest ever involving a New Jersey
pharmaceutical company. It would provide $ 1 billion for future medical
checkups and health care for anyone who used the drugs, plus as much as
$ 2.5 billion to compensate those who have existing heart valve problems
or develop them in the future. An additional $ 1 billion would be set
aside to resolve any remaining claims outside the settlement and to pay
legal costs.

"This is certainly the most comprehensive settlement in any case in U.S.
history from a public health point of view," said Christopher
Placitella, a Woodbridge lawyer representing 94,000 New Jerseyans who
used the diet drugs.

A trial had been under way in New Brunswick over whether the company
should pay for medical monitoring for healthy former users of fen-phen.
It was suspended this week when the settlement appeared near.

Nearly 6 million Americans took Redux or Pondimin, one-half of the
fen-phen drug cocktail, before the drugs were pulled from the market in
September 1997 after a Mayo Clinic study linked fen-phen to potentially
fatal heart valve damage. As of last Monday, more than 6,500 lawsuits
involving 11,300 people had been filed across the country, AHP officials
said last Thursday.

Plaintiffs are seeking injury awards for heart and lung damage, medical
monitoring for people who took the drugs but have not developed
injuries, and penalties against the company. Lawyers for the plaintiffs
say AHP ignored and withheld information on heart and lung damage from
the medical community and regulators in the United States and Europe.

"This settlement does an enormous amount of good," said Michael
Fishbein, a Philadelphia plaintiffs lawyer and lead negotiator in the
settlement talks. "AHP has accepted responsibility for what it has done
by entering into this settlement."

The company has denied any wrongdoing and said it acted responsibly in
developing and marketing the diet drugs. "This announcement is a
significant turning point for us," AHP Chief Executive John Stafford
said in a teleconference. "AHP made the decision to settle to avoid the
uncertainty and distractions of litigation. We believe the company acted
lawfully and responsibly at all times." The diet drugs, Stafford said,
have not created a significant public health problem.

Plaintiffs lawyers would receive as much as $ 430 million in fees, more
than half of which would be drawn from the injury fund. However, some
lawyers are expected to urge their clients to opt out of the settlement
and pursue independent lawsuits against AHP. One lawsuit in August
sparked the talks for a national settlement. Debbie Lovett, 36, of Grand
Saline, Texas, who faces lifelong heart problems she blames on fen-phen,
was awarded $ 23 million in the first such lawsuit to reach a jury. The
verdict sent AHP's stock price tumbling and made the company appear much
more vulnerable in the eyes of investors, stock analysts say. After an
appeal, the case was settled last month for about $ 2 million.  "This
has been a huge blemish on the company," Michael Krensavage, an analyst
for Brown Brothers Harriman, said of the litigation.

On word of the settlement, AHP stock rose 8 percent in trading last
Thursday, to $ 48.75 a share, suggesting that investors were satisfied
that the company could pay for the settlement. "I think from the
investment community's point of view, this is a good settlement," said
Bob Kirby of Edward Jones, a money management firm in St. Louis. "If
this gets approved, the uncertainty surrounding the ultimate cost of
this litigation goes away... and the company can focus on what it needs
to do. I can only imagine the amount of chaos something like this
inflicts on the management of a company and its employees." Sena Lund,
an analyst for Mehta Partners in New York, said: "This certainly lifts
the dark clouds."

The settlement does not address about 100 separate claims of primary
pulmonary hypertension, an often fatal lung disease that some former
fen-phen users developed. Those cases will be handled separately, AHP
said. (The Record (Bergen County, NJ) 10-8-1999)

According to Investor’s Business Daily, about 4,100 suits have been
filed against American Home, making it one of the largest product
liability cases ever. American Home took in about $ 13 billion in
revenue last year and earned $ 2.5 billion in profits. (Investor's
Business Daily 10-8-1999)

The New York Post says that the settlement surpasses the $3.2 billion
that Dow Corning agreed to pay to women who claimed injury from its
silicone breast implants. But the amount is far below the $368.5 billion
settlement reached between the tobacco industry and its opponents.

American Home, the nation's fifth-largest drug maker, will pay $2.32
billion for injuries, $1 billion for drug refunds and medical monitoring
and at least $429 million in plaintiffs' legal fees.

The maker of Advil also will pay $25 million for heart-disease research.
(The New York Post 10-8-1999)

Standard & Poor's upgraded shares of American Home Products (NYSE: AHP)
to 3 STARS (hold) from 2 STARS (avoid) after the company announced a
$3.8 billion diet drug class action suit settlement.  Analyst Herman
Saftlas says $2.6 billion is to pay plaintiffs with diagnosed
conditions, and $1.2 billion will fund medical monitoring.  He notes
that AHP just set a restructuring of its troubled agricultural segment,
while its drug segment is benefiting from new products.  But he says
litigation costs will be restrictive, and now sees the stock as
adequately valued.

According to AFX News of October 8, 1999, American Home Products Corp
said it has adopted a stockholder rights plan intended to provide
protection against coercive or unfair takeover tactics, and to encourage
anyone seeking to acquire the company to negotiate with the board first.
The company said it should provide a sound and reasonable means of
safeguarding the interests of all stockholders if an effort is made to
acquire the company at a price not reflective of its fair value.

Under the rights plan, the company said it will issue shareholders with
one preferred share purchase right for each outstanding share of AHP's
0.33-1/3 par value common stock. Each of the rights, which are not
currently exercisable, entitles the holder to purchase one
one-thousandth (1/1000) of a share of AHP's newly designated Series A
Junior Participating Preferred Stock at an exercise price of $225.

If any person or group of affiliated persons acquires beneficial
ownership of 15 pct or more of the outstanding shares of AHP's common
stock, each holder of a right, other than the acquirer, will be entitled
to receive, upon payment of the exercise price, a number of shares of
AHP's common stock having a market value equal to two times the exercise

The distribution of the rights will be made on Oct 18 payable to
stockholders of record at the close of business on that date. The rights
will expire on Oct 7 2009.

FEN-PHEN: Charfoos & Christensen Talks About AHP Settlement For MI
Charfoos & Christensen, P.C., the law firm that founded the Michigan
Fen-Phen class action lawsuit, is pleased to announce that the lawsuit
against American Home Products, including its companies, A. H. Robins,
Wyeth Laboratories, Inc., and Wyeth-Ayerst Laboratories, Inc., has
settled for approximately $3.7 billion. This settlement does not apply
to individuals whose products were not manufactured by American Home
Products. Cases against the other named defendants in the lawsuit

Attorney J. Douglas Peters of the Charfoos & Christensen, P.C. law firm
is cautiously optimistic about the settlement given the state of the law
in Michigan. "We hope the Fen-Phen settlement will apply to injured
people in Michigan, but it may not," says Peters. "Our law firm
challenged the Republican sponsored statute backed by Governor Engler
which granted immunity to drug companies whose products were approved by
the Food and Drug Administration." Although the statute was declared
unconstitutional by Wayne County Circuit Court Judge Marianne Battani in
a decision issued November 27, 1998, the matter is now pending in the
Michigan Court of Appeals."

Michigan is the only one of the 50 states to grant immunity to defendant
drug manufacturers. Peters does not know how much of the settlement will
go to injured Michigan Fen-Phen and Redux users, or what the
distribution process will be.

For any questions regarding this release, please contact J. Douglas
Peters or Ann K. Mandt at Charfoos & Christensen, P.C., 313-875-8080 or
fax, 313-875-8522

FEN-PHEN: Frequently Asked Questions And Answers On Settlement
Q: What is "Fen-Phen"?
A: The combination of American Home Products Corporation's Pondimin
   and/or Redux and phentermine was a popular diet cocktail known as

Q: What type of health risk does it pose?
A: Varying levels of heart valve damage.

Q: Who is included as a "class member?"
A: Includes all of nearly six million individuals who consumed Pondimin
   and/or Redux, alone or in combination with phentermine, for any
   length of time.

Q: What does the settlement provide?
A: Provides medical monitoring as well as compensation for injury
   through two funds totaling almost $5 billion. Fund A underwrites
   medical monitoring, treatment, reimbursement and research/education.
   Fund B underwrites compensation for personal injury relating to
   heart disease.

Q: Can class members exclude themselves from the settlement?
A: Class members have three opportunities to "opt out" from the
   settlement and pursue individual legal remedies.

Q: What about punitive damages against the company?
A: The settlement prohibits class members from seeking punitive damages
   if they initially did not exclude themselves from the settlement. In
   return, the class members have a right to numerous benefits not
   currently available.

Q: Can class members collect before the settlement is approved by the
A: Class members may elect an Accelerated Implementation Option which
   allows them to receive the benefits of the settlement at an early
   date and regardless of whether the Settlement as a whole receives
   final judicial approval.

FEN-PHEN: More than 100,000 From Washington Can Share In Settlement
Now Washington dieters who took the diet drugs Redux or Pondimin can
benefit from a $ 4 billion dollar class action settlement. The
settlement will include money to pay patients who were seriously injured
by the drugs and for future medical monitoring for those who are not yet
seriously injured. The settlement is open to anyone who used Pondimin or
Redux in the United States, whether or not they filed suit.

"This settlement is for everyone who ever took Redux or Pondimin, no
matter how long, although payments vary significantly based on how long
people took the drugs and how seriously they were injured," says Seattle
Attorney Michael Woerner. Individuals who may suffer from primary
pulmonary hypertension (PPH) will not be included in this settlement and
should contact Woerner regarding ongoing efforts to resolve these

PPH is a rare but potentially fatal disease, characterized by increased
pressure in the lungs and potential heart failure. He adds that there
are a great number of diet drug users out there who are a-symptomatic,
have not had an echocardiogram, and do not know that they are sick. With
respect to heart valve damage, Pondimin and Redux appear to cause the
body to create extra fibrous tissue around the heart valve, making the
valves less elastic. The loss of elasticity causes the valves to close
improperly, becoming weakened. In this weakened state the valve is
highly susceptible to bacterial attack. Something as simple as getting
your teeth cleaned can put enough bacteria into your bloodstream to put
you at additional risk. Woerner adds that with advanced knowledge of the
problem, a dentist prophylactically can put a high-risk patient on
antibiotics. Woerner indicates individuals taking these medications for
any length of time may suffer problems right away; there is no latency.
He says, "It is a silent killer. Patients can have weakened heart valves
and still feel fine."

Fen-phen consists of fenfluramine and phentermine; each manufactured by
separate companies. AHP manufactured Pondamin, the brand name for
fenfluramine. AHP also marketed Redux (dexfenfluramine), a diet drug
chemically similar to Pondimin. Several companies under different brand
names manufactured Phentermine, including Ionamin, manufactured by
Medeva Pharmaceuticals, and Fastin, made by SmithKline Beecham.

In September 1997, AHP pulled Pondimin and Redux from the market after
the FDA received reports of the potentially fatal disease PPH and heart
valve disorders in patients who took fenfluramine.  A statewide medical
monitoring class action suit was previously certified by a Spokane
County judge against the manufacturers of diet drugs.

Under the terms of the proposed nationwide settlement, all Washington
residents who would be included in the statewide medical monitoring
class would be included in the nationwide settlement. Woerner's firm
represents dozens of individual plaintiffs who have filed cases in
Washington and other states. Michael Woerner of Keller Rohrback L.L.P.
represents individuals who are seeking damages from American Home
Products for their injuries induced by the popular diet drugs known as
Fen-phen and Redux. Contact Keller Rohrback L.L.P. Charlene Engle,

GREAT WESTERN: Hanzman, Criden Announces Settlement Of Securities Suit
HANZMAN, CRIDEN, CHAYKIN & PONCE, P.A. pursuant to an Order of the Court
provide the following Summary Notice –

In re Great Western Bank Securities Litigation, Case No.
96-3362-CIV-SEITZ, United States District Court Southern District of
Florida Southern Division (Miami) --


YOU ARE HEREBY NOTIFIED that the Plaintiff in the above litigation has
entered into a Stipulation of Settlement (the "Stipulation") with
Defendants to resolve as against the Defendants the issues raised in the
above action. PLEASE BE FURTHER ADVISED that pursuant to an Order of the
United States District Court, dated September 20, 1999, a Hearing will
be held on December 9,1999 at 4:00 p.m. before the Honorable Patricia A.
Seitz at the United States Courthouse located at 301 North Miami Avenue,
Miami, Florida, for the purpose of determining whether: (1) the proposed
settlement of the Litigation for the principal amount of Nine Hundred
Thousand Dollars ($ 900,000.00), plus interest earned thereon, should be
approved by the Court as fair, reasonable and adequate; (2) the
Litigation should be dismissed on the merits and with prejudice pursuant
to the terms of the Stipulation; (3) the Plan of Allocation should be
approved; and (4) Plaintiff's counsel should be awarded fees, costs and
expenses incurred in connection with the Litigation, together with
interest thereon. If you purchased shares of the Sierra North American
Government Fund during the period August 8, 1993 through July 20, 1997,
through a Great Western Financial Securities Corporation branch located
in a Great Western Bank branch in Florida, your rights may be affected
by the settlement of the Litigation. In particular, if you are a member
of the above-defined Class and wish to participate in the Settlement,
you must submit a Proof of Claim and Release form, in the manner
provided in the Notice of Pendency and Proposed Settlement of Class
Actions, by no later than December 7, 1999.

If you wish to exclude yourself from the Class, and from participation
in the Settlement, you must submit your request for exclusion, in the
manner provided in the Notice of Pendency and Proposed Settlement of
Class Actions, by no later than November 22, 1999. Unless you ask to be
excluded from the Class, you will be bound by any judgment or order
entered in connection with the Settlement, including any releases of
claims against the Defendants, whether or not you file a Proof of Claim
and Release form.

If you have not received a Notice of Pendency and Proposed Settlement of
Class Actions and a Proof of Claim and Release, you may obtain copies by
contacting: Complete Claim Solutions, Inc., 319 Clematis Street, Suite
500, West Palm Beach, Florida, 33401.

Plaintiff's Settlement Counsel representing the Class are:

BILZIN SUMBERG DUNN & AXELROD, LLP Co-Counsel for Plaintiff 2500 First
Union Financial Center 200 So. Biscayne Boulevard Miami, FL 33131-2336

HANZMAN, CRIDEN, CHAYKIN & PONCE P.A. Co-Counsel for Plaintiff 2100
First Union Financial Center 200 So. Biscayne Boulevard Miami, FL 33131


CONTACT: Complete Claim Solutions, Inc., West Palm Beach, Fla. Dawn
Addazio, 561/651-7777

HEALTHSOUTH CORP: Acquired Horizon/CMS Faces N.Y. Securities Suits
On October 29, 1997, HEALTHSOUTH acquired Horizon/CMS through the merger
of a wholly owned subsidiary of HEALTHSOUTH with and into Horizon/CMS.
Horizon/CMS is currently a party, or is subject, to certain material
litigation matters and disputes, which are described below, as well as
various other litigation matters and disputes arising in the ordinary
course of its business. The Company is not itself a party to the
litigation described below.

                  SEC and NYSE Investigations

The Division of Enforcement of the SEC has for some time been conducting
a private investigation with respect to trading in the securities of
Horizon/CMS and Continental Medical Systems, Inc. ("CMS"), which was
acquired by Horizon/CMS in June 1995. In connection with that
investigation, Horizon/CMS produced certain documents, and Neal M.
Elliott, then Chairman of the Board, President and Chief Executive
Officer of Horizon/CMS, and certain other former officers of Horizon/CMS
have given testimony to the SEC. Horizon/CMS has also been informed that
certain of its division office employees and an individual, affiliates
of whom had limited business relationships with Horizon/CMS, have
responded to subpoenas from the SEC. Mr. Elliott also produced certain
documents in response to a subpoena from the SEC. In addition,
Horizon/CMS and Mr. Elliott have responded to separate subpoenas from
the SEC pertaining to trading in Horizon/CMS's common stock and various
material press releases issued in 1996 by Horizon/CMS; Horizon/CMS's
February 18, 1997 announcement that the Company would acquire
Horizon/CMS; and any discussions of proposed business combinations
between Horizon/CMS and Medical Innovations and Horizon/CMS and certain
other companies. The Company and Horizon/CMS have no knowledge of the
current status of the investigation, and neither Horizon/CMS nor the
Company possesses all the facts with respect to the matters under
investigation. Although neither Horizon/CMS nor the Company has been
advised by the SEC that the SEC has concluded that any of Horizon/CMS,
Mr. Elliott or any other current or former officer or director of
Horizon/CMS has been involved in any violation of the federal securities
laws, there can be no assurance as to the outcome of the investigation
or the time of its conclusion. Both Horizon/CMS and the Company have, to
the extent requested to date, cooperated fully with the SEC in
connection with the investigation.

In March 1995, the New York Stock Exchange informed Horizon/CMS that it
had initiated a review of trading in Hillhaven Corporation common stock
prior to the announcement of Horizon/CMS's proposed acquisition of
Hillhaven. In April 1995, the NYSE extended the review of trading to
include all dealings with CMS. On April 3, 1996, the NYSE notified
Horizon/CMS that it had initiated a review of trading in its common
stock preceding Horizon/CMS's March 1, 1996 press release announcing a
revision in Horizon/CMS's third quarter earnings estimate. On February
20, 1997, the NYSE notified Horizon/CMS that it was reviewing trading in
Horizon/CMS's securities prior to the February 18, 1997 announcement
that the Company would acquire Horizon/CMS. Horizon/CMS has cooperated
with the NYSE in its reviews and has no knowledge of the current status
of such reviews.

In February 1997, the Company received a subpoena from the SEC with
respect to its investigation concerning trading in Horizon/CMS common
stock prior to the February 18, 1997 announcement that the Company would
acquire Horizon/CMS and a request for information from the NYSE in
connection with its review of such trading. The Company responded to
such subpoena and request for information and advised both the SEC and
the NYSE that it intended to cooperate fully in any investigations or
reviews relating to such trading. The Company provided certain
additional information to the SEC in April 1997.

Neither the Company nor Horizon/CMS has received any further inquiries
from the SEC or the NYSE with respect to the matters described above
since mid-1997, and the Company is unaware of the current status of such
investigations or reviews. The Company does not intend to describe these
matters in future reports unless it becomes aware of new developments
with respect to them.

HEALTHSOUTH CORP: Decries Merit Of Securities Suits In Alabama
The Company has been served with certain lawsuits filed beginning
September 30, 1998 which purport to be class actions under the federal
and Alabama securities laws. Such lawsuits were filed following a
decline in the Company's stock price at the end of the third quarter of
1998. Seven such suits have been filed in the United States District
Court for the Northern District of Alabama: Robert M. Gordon, et al. v.
HEALTHSOUTH Corporation, et al., Civil Action No. 98-J-2634-S, Twin Plus
LLC, et al. v. HEALTHSOUTH Corporation, et al., Civil Action No.
98-PWG-2695-S, Irene Rigas, et al. v. HEALTHSOUTH Corporation, et al.,
Civil Action No. 98-RRA-2777-S, Harry Schipper v. HEALTHSOUTH
Corporation, et al., Civil Action No. 98-N-2779-S, Ryan McCormick v.
HEALTHSOUTH Corporation, et al., Civil Action No. 98-RRA-2831-S, United
Food & Commercial Workers Union Local 100-A Pension Fund v. HEALTHSOUTH
Corporation, et al., Civil Action No. 98-BU-2869-S, and Vinod Parikh v.
HEALTHSOUTH Corporation, et al., Civil Action No. 98-BU-2869-S.

These are substantially identical complaints filed against the Company
and certain of its officers and Directors alleging that, during the
period August 12, 1997 through September 30, 1998, the defendants
misrepresented or failed to disclose certain material facts concerning
the Company's business and financial condition in order to artificially
inflate the price of the Company's Common Stock and issued or sold
shares of such stock during the purported class period, all allegedly in
violation of Section 10(b) of the Securities Exchange Act of 1934 and
Rule 10b-5 thereunder. Certain of the named plaintiffs in some of the
complaints also purport to represent separate subclasses consisting of
former stockholders of Horizon/CMS Healthcare Corporation and National
Surgery Centers, Inc. who received shares of the Company's Common Stock
in connection with the Company's acquisition of those entities and
assert additional claims under Section 11 of the Securities Act of 1933
with respect to the registration of securities issued in those
acquisitions. In January 1999, these complaints were ordered to be
consolidated, with a consolidated amended complaint due to be filed on
April 5, 1999 (after a one-month extension requested by the plaintiffs'

Another suit, Peter J. Petrunya v. HEALTHSOUTH Corporation, et al.,
Civil Action No. 98-05931, was filed in the Circuit Court for Jefferson
County, Alabama, alleging that during the period July 16, 1996 through
September 30, 1998 the defendants misrepresented or failed to disclose
certain material facts concerning the Company's business and financial
condition, allegedly in violation of Section 8-6-17 and 8-6-19 of the
Alabama Securities Act. The Petrunya complaint was voluntarily dismissed
by the plaintiff without prejudice in January 1999.

Additionally, a suit styled Dennis Family Trust v. Richard M. Scrushy,
et al., Civil Action No. 98-06592, has been filed in the Circuit Court
for Jefferson County, Alabama, purportedly as a derivative action on
behalf of the Company. That suit largely replicates the allegations of
the federal actions described in the preceding paragraph and alleges
that the current Directors of the Company, certain former Directors and
certain officers of the Company breached their fiduciary duties to the
Company and engaged in other allegedly tortious conduct. The plaintiff
in that case has forborne pursuing its claim thus far pending further
progress in the federal actions, and the Company has not yet been
required to file a responsive pleading in the case.

The Company believes that all claims asserted in the above suits are
without merit, and expects to vigorously defend against such claims.
Because such suits have only recently been filed, the Company cannot
predict the outcome of any such suits or the magnitude of any potential
loss if the Company's defense is unsuccessful.

HEALTHSOUTH CORP: Horizon Contests Carolina Suit Re Communi-Care Stock
On May 28, 1997, CMS was served with a lawsuit styled Kenneth Hubbard
and Lynn Hubbard v. Rocco Ortenzio, Robert A. Ortenzio and Continental
Medical Systems, Inc., No. 3:97 CV294MCK, filed in the United States
District Court for the Western District of North Carolina, Charlotte
Division, by the former shareholders of Communi-Care, Inc. and Pro
Rehab, Inc. seeking damages arising out of certain "earnout" provisions
of the definitive purchase agreements under which CMS purchased the
outstanding stock of Communi-Care, Inc. and Pro Rehab, Inc. from such

The plaintiffs allege that the manner in which CMS and the other
defendants operated the companies after their acquisition breached its
fiduciary duties to the plaintiffs, constituted fraud, gross negligence
and bad faith and a breach of their employment agreements with the
companies. As a result of such alleged conduct, the plaintiffs assert
that they are entitled to damages in an amount in excess of $27,000,000
from CMS and the other defendants. Horizon/CMS believes, based upon its
evaluation of the legal and factual matters relating to the plaintiffs'
assertions, that it has valid defenses to the plaintiffs' claims and, as
a result, intends to vigorously contest such claims. Because this
litigation remains at a procedurally early stage, the Company cannot now
predict the outcome or effect of such litigation or the length of time
it will take to resolve such litigation.

HEALTHSOUTH CORP: Horizon Faces EEOC Litigation Re Pregnancies
In March 1997, the Equal Employment Opportunity Commission (the "EEOC")
filed a complaint against Horizon/CMS alleging that Horizon/CMS had
engaged in unlawful employment practices in respect of Horizon/CMS's
employment policies related to pregnancies. Specifically, the EEOC
asserts that Horizon/CMS's alleged refusal to provide pregnant employees
with light-duty assignments to accommodate their temporary disabilities
caused by pregnancy violates Sections 701(k) and 703(a) of Title VII, 42
U.S.C. ss.ss. 2000e-(k) and 2000e-2(a). In this lawsuit, the EEOC seeks,
among other things, to permanently enjoin Horizon/CMS's employment
practices in this regard. Horizon/CMS disputes the factual and legal
assertions of the EEOC in this litigation and intends to vigorously
contest the EEOC's claims. Because this litigation remains at a
procedurally early stage, the Company cannot predict the length of time
it will take to resolve the litigation or the outcome of the litigation.

HEALTHSOUTH CORP: Horizon Faces MI Criminal Case Re Nursing Facilities
Horizon/CMS learned in September 1996 that the Attorney General of the
State of Michigan was investigating one of its skilled nursing
facilities. The facility, in Howell, Michigan, was owned and operated by
Horizon/CMS from February 1994 until December 31, 1997. As widely
reported in the press, the Attorney General seized a number of patient,
financial and accounting records that were located at this facility. By
order of a circuit judge in the county in which the facility is located,
the Attorney General was ordered to return patient records to the
facility for copying.

Horizon/CMS advised the Michigan Attorney General that it was willing to
cooperate fully in the investigation. The facility in question was sold
by Horizon/CMS to IHS on December 31, 1997.

On February 19, 1998, the State of Michigan filed a criminal complaint
against Horizon/CMS, four former employees of the facility and one
former Horizon/CMS regional manager, alleging various violations in 1995
and 1996 of certain statutes relating to patient care, patient medical
records and the making of false statements with respect to the condition
or operations of the facility (State of Michigan v. Horizon/CMS
Healthcare Corp., et al., Case No. 98-630-FY, State of Michigan District
Court 54B). The maximum fines chargeable against Horizon/CMS under the
counts alleged in the complaint (exclusive of charges against the
individual defendants, some of which charges may result in
indemnification obligations for Horizon/CMS) aggregate $69,000.
Horizon/CMS denies the allegations made in the complaint and expects to
vigorously defend against the charges. The litigation has continued at
the pretrial hearing phase for several months, including numerous
adjournments, and such pretrial hearing phase is not expected to
conclude until April 1999, after which time the court will determine
which, if any, charges may be brought to trial. Because of the
preliminary status of this litigation, it is not possible to predict at
this time the outcome or effect of this litigation or the length of time
it will take to resolve this litigation.

HMO: Aetna Faces Another Class Action Over Secret Contracts with MDs
Aetna U.S. Healthcare has been hit with a class-action ERISA suit that
says it violates the rights of its HMO members through secret financial
incentives for doctors who put cost-cutting before their own medical

Ironically, the suit comes just days after AUSH persuaded a federal
judge to dismiss similar a class-action RICO suit that accused it of
promising its HMO customers high-quality care while secretly insisting
that doctors cut costs. That suit, Maio v. Aetna Inc., was dismissed by
Senior U.S. District Judge John P. Fullam, who found fundamental, fatal
flaws, saying the plaintiffs could never show actual, imminent injury
since their theory would require the court to assume that doctors would
abandon their ethics and put their own economic interests ahead of their
patients' welfare. And even if that assumption were correct, Fullam
said, Aetna "would not be the proximate cause of the providers' ethical

The new suit, Conte v. Aetna U.S. Healthcare Inc., focuses on claims
that the insurer withholds information from members about how it pays
its doctors and that such conduct violates the insurer's fiduciary duty
under ERISA. Attorneys H. Laddie Montague Jr. and Jerome M. Marcus of
Berger & Montague filed the suit along with Kenneth M. Dubrow of Kelly
Dubrow & Herron on behalf of a nationwide class of AUSH's HMO members
who receive their coverage as part of an employee benefit program.

The suit alleges that AUSH promises it HMO members that "the primary
physician's gatekeeper function will be exercised by each primary care
physician on the basis of that physician's independent medical
judgment," and that the medical care recommended or prescribed "will be
consistent with [the] physician's independent medical judgment." But "in
fact," the suit says, AUSH's contracts with doctors "impose an array of
restrictions which are intended to, may in fact, and in certain
instances do in fact, discourage the physicians from referring their
patients for, and from prescribing for their patients, the optimal form
of medical care. "Certain kinds of care or medication are "discouraged
altogether," the suit says, while in other instances AUSH gives a doctor
"financial incentives to deviate from his or her own independent medical

The suit seeks compensatory damages as well an injunction requiring
Aetna to make fuller disclosures to HMO members that detail its
agreements with doctors. "This is part of wave of similar actions by
trial lawyers," Aetna spokesman Fred Laberge said. "They are targeting
the health care industry for their own profits at the expense of small
businesses and average American families who are struggling to afford
quality health care." Laberge said Aetna U.S. Heathcare's general
practice is to provide full disclosure on how physicians are paid and
how coverage decisions are made, through member handbooks, physician
contracts and medical policy bulletins. He said the company also posts
medical coverage policies on the Internet. Aetna insures 21 million
people, almost 7 million of whom are in its HMO. The suit is the second
this week seeking class-action status against an HMO. A suit filed in
Miami on Monday against Humana Inc. accuses that HMO of misleading its
members by not telling them that cost not medical need is the main
factor behind its decisions on what medical care it approves for
members. The Associated Press contributed to this report. (The Legal
Intelligencer 10-8-1999)

HMO: Aetna Faces National Suit Charging RICO, ERISA Violations
Filed on behalf of 18.3 million Aetna HMO enrollees, allegations include
mail and wire fraud, 'heavy-handed extortionate conduct'.

Charging the nation's largest health maintenance organization with
misrepresentation, fraud and extortion to "systematically limit, delay
or deny medical care" to its members, a group of nationally renowned
attorneys, called the REPAIR1 Team, filed a national class action
lawsuit on behalf of 18 million HMO enrollees against Aetna, Inc., and
25 subsidiaries alleging violations of the Racketeer Influenced and
Corrupt Organizations (RICO) Act and the Employee Retirement Income
Security Act (ERISA).

The lawsuit charges that Aetna engaged in a "nationwide fraudulent
scheme" to enroll members by promising quality healthcare and then
denying needed services to boost corporate profits and dominate the HMO
marketplace. It also charges a "pattern of heavy-handed extortionate
conduct against Aetna's physicians" designed to coerce them into
accepting contracts imposing "unreasonable, and often unsafe,
restrictions on the level of medical services that may be delivered."

"Never again will Aetna or any HMO place profits before patient care,"
said Richard Scruggs, counsel for class representative Jo Ann O'Neill
and the 18.3 million Aetna enrollees who are members of the class. "When
you get sick, you need an M.D., not an M.B.A. Unfortunately, Aetna used
accountants, not doctors, to make life-or-death medical decisions. "Our
lawsuit will hold this Goliath accountable for its broken promises to
millions of Davids," Scruggs said. "It will compensate Aetna enrollees
for the value of care promised but denied them and change forever the
way this HMO operates. Thus, it has the potential to dramatically
improve the quality of healthcare throughout the nation.

"Clearly, Aetna needs to learn some lessons in responsibility," Scruggs
charged. "Just yesterday, The Wall Street Journal reported that Aetna
CEO Richard Huber claims 'If medical mistakes are made ... it's the
doctors' fault, not Aetna's.' In fact, our lawsuit proves that Aetna
used extortion to force doctors to sign contracts that the American
Medical Association says are 'dangerous,' 'interfere with medical
decision-making' and 'undermine the patient-physician relationship.'

"In a perfect world," Scruggs said, "No HMO would substitute
hypocritical business practices for the Hippocratic Oath. No HMO would
promise its members services it has no intention of delivering. And no
HMO would be allowed by Congress or regulatory authorities to get away
with it. But in the real world, our lawsuit is the last line of defense
for millions of men, women and children who were sold a bill of goods at
the expense of their health. They have asked us to change this
unconscionable healthcare system through the Courts and that is what we
will do."

The lawsuit seeks compensatory damages to class members, which can be
tripled under RICO; an injunction preventing Aetna from pursuing the
practices alleged by the class action; punitive damages; the imposition
of a Cy Pres Trust to be administered by the Court; prejudgment and
post-judgment interest; and other relief the Court deems appropriate.

Filed in U.S. District Court, O'Neill v. Aetna details Aetna's alleged
strategy "of fraudulently inducing increased membership to obtain
revenues, while actually aggressively and deceitfully seeking to reduce
the delivery of quality healthcare services provided its members to
maximize its profit." It cites multiple acts of mail and wire fraud,
violations of the Travel Act, "heavy-handed extortionate conduct," and a
breach of Aetna's fiduciary duties under ERISA.

The lawsuit charges that Aetna engages in a variety of practices that
run contrary to what the company tells enrollees and that harm the
quality of care, including:
    * Limiting referrals to specialists and penalizing doctors who
      violate Aetna's profit-driven criteria;
    * Gagging doctors' ability to communicate openly with their
      patients about their care and the inadequacy of Aetna's policies;
    * denying reimbursement for emergency care despite assurances that
      Aetna complies with the "prudent layperson" standards;
    * Usurping sound medical and clinical standards by controlling
      medical necessity determinations;
    * Imposing dangerous financial incentives that discourage inpatient
      or more expensive procedures and tests;
    * Restricting prescription drug formularies despite promising
      beneficiaries that they will get the medications prescribed by
      their doctors; and
    * Imposing harsh economic sanctions on doctors who challenge Aetna
      on behalf of their patients.

The lawsuit notes that Aetna's merger with U.S. Healthcare in 1996, its
acquisition of NYLCare in 1998 and its purchase of Prudential Healthcare
this August have given it disproportionate market clout. This gives
Aetna the power to engage in "Undisclosed heavy-handed profit and market
dominance strategies designed to coerce physicians into accepting
contracts and policies and practices on a 'take it or leave it' basis.
... The defendants engage in extortionate conduct designed to exploit
physician fear of economic loss or loss of business."

"Under Aetna's incentive and disincentive arrangements, the fewer the
services provided to members, the greater the physicians' compensation,"
the lawsuit charges. "Conversely, the more services provided, even where
deemed by Aetna physicians to be medically necessary, the greater the
likelihood the physicians will owe money at the end of the
reconciliation of budget period. These arrangements are specifically
designed to cause Aetna physicians to become unwilling co-conspirators
in the reduction or limitation in the delivery of healthcare services to
the plaintiff and the class in order to maximize profits."

The RICO count of the lawsuit seeks the "return of the portion of
premium payments allocable to the profits the defendants derived through
fraud and non-disclosure" or "alternatively, disgorgement of profits
made by the defendants through fraud and nondisclosure," either of which
are subject to treble damages.

The ERISA breach of fiduciary duty count seeks "restitution of all sums
of money paid to the defendants during such time as defendants were
engaged in the breach(s) of the fiduciary obligation(s) imposed by law.
The defendants properly should be compelled to disgorge all such
revenues received during the period of its wrongful conduct, including
fiduciary breach, fraud and non- disclosure of its conflicted private

Scruggs noted that this lawsuit is unrelated to the "Patients' Bill of
Rights" before Congress. "That legislation would give individuals the
right to sue if they are harmed by HMO treatment decisions. Our class
action is designed to transform the entire system so that no patient is
ever again harmed by an HMO." Members of the class are enrollees in any
of Aetna's HMO plans at any time between July 19, 1996 (the date Aetna
acquired US Healthcare) to the present.

Members of the REPAIR Team filing on behalf of the class are Richard F.
Scruggs and Sidney A. Backstom of Scruggs, Millette, Bozeman & Dent,
P.A.; Ronald L. Motley, H. Blair Hahn and Donni E. Young of Ness,
Motley, Loadholt, Richardson & Poole, P.A.; Walter Umphrey and Keith
Kebodeaux of Provost Umphrey Law Firm, L.L.P.; Paul S. Minor of Minor &
Associates; John Eddie Williams and Herbert T. Shwartz of Williams
Bailey Law Firm, L.L.P.; Joseph C. Langston of Langston, Langston,
Michael, Bowen & Tucker; Wayne D. Blackmon, Esq.; Hiram Eastland of
Eastland Law Offices; George Chandler, Attorney at Law; Fred Furth and
Ben Furth of Furth, Fahrner & Mason; Harry Potter; David O. McCormick,
P.A .; and Cary Patterson of Nix, Patterson & Roach, L.L.P. CONTACT:
Dick Scruggs, 228-762-6068 or David White, 202-328-5400, both for
Scruggs, Millette, Bozeman & Dent, P.A.

HOLOCAUST VICTIMS: Nazi Slave Laborers Want $10 Bil Pay-Off
A negotiating session over compensation for people forced into slave
labour by the Nazis opened in Washington, with lawyers for the victims
threatening to walk out unless Germany offers at least $ 10 billion.

As the two-day session began behind closed doors at the US State
Department, former slave labourers stepped up a bitter advertising
campaign accusing German companies of treating them "like animals" by
making as many as 2.4 million people work in support of the Nazi war

German companies and the German government are prepared to pay a total
of six billion marks ($ 3.3 billion) to the survivors, according to the
Frankfurter Rundschau newspaper, but lawyers for class-action
partnerships dismissed any such offer as "paltry".

Two German lawyers representing survivors have said that any figure
below $ 10 billion is unacceptable. "To make an offer of $ 200 a victim
is a disgrace," Mel Weiss, one of the lawyers said. "If they don't start
negotiating with real money...we are going to walk away from these

If the talks collapse, the plaintiffs' lawyers are expected to change
strategy and push for an alteration in state and federal laws to enable
them to sue the German companies in American courts. (The Times (London)

HOLOCAUST VICTIMS: Schroeder Defends $3.3 Bil German Offer To Fund
Chancellor Gerhard Schroeder defended a German offer of $3.3 billion to
compensate Nazi-era slave and forced laborers against criticism from
Jewish groups and survivors' representatives that the sum is not enough.
''I believe that the German industry ... has presented a worthy offer,''
Schroeder said. ''I would urgently advise the critics here and in the
United States to work this out.''

Schroeder declined to say whether there was room to increase the amount
presented this week during talks in Washington, but said he did not
believe the proposal had damaged the talks. ''German industry is on the
right path with its offer,'' he said. That attorneys representing
survivors in lawsuits seeking compensation see it differently ''is a
totally normal process.''

Lothar Evers, head of a German advocacy group for Nazi victims, however
termed the offer an insult to victims. Some would come away with only
1,000 or 2,000 marks ($ 550 or 1,100), he said, which is ''far away''
even from the wages of the time, ''not to mention money for pain and
suffering for enslavement, children who were killed and medical
experiments.'' Schroeder, he said, should ''finally quit coming to the
defense of the complaining bosses'' and pressure more to sign up to the
initiative. While three dozen German firms have signaled their readiness
to contribute, ''what's needed is a big common action of possibly
hundreds of companies,'' he said.

Michel Friedman of the Central Council of Jews in Germany also called on
Schroeder to get more personally involved. He said survivors should
receive 10,000 to 15,000 marks ($ 5,500 to 8,300) each a figure named by
many other critics as well.

The leader of Berlin's Jewish community, Andreas Nachama, called the
offer ''unsatisfactory'' but hesitated to name a figure he thought
appropriate, saying it should depend on how many days victims were made
to work. ''We know that every day more people die, and I think we are
under great time pressure that those who suffered such difficulty should
finally receive something,'' he told NDR radio.

Schroeder's spokesman Uwe-Karsten Heye said Germany remained optimistic
an agreement could be reached next month on the fund. At a news
conference, Heye also declined to say whether the German side would
consider raising the offer, saying the government wanted to wait to hear
from its envoy to the talks, Otto Lambsdorff, who will report Monday to
the chancellor. But he said it was a success that a clear proposal was
now on the table and could be discussed further at the next round of
talks Nov. 16-17 in Bonn.

Amounts of between $20 billion and $40 billion sought by some of the
class-action lawyers were always ''beyond the realm of the possible,''
he said, adding that the German side believed a ''realistic view on the
actual possibilities'' would now develop. (AP Worldstream 10-8-1999)

MATTEL INC: Savett Frutkin Files Securities Suit In California
Savett Frutkin Podell & Ryan, P.C. hereby gives notice that a class
action complaint has been filed in the United States District Court for
the Central District of California on behalf of a Class of persons who
purchased the common stock of Mattel, Inc. (NYSE: MAT) at artificially
inflated prices during the period February 1, 1999 through October 1,
1999 and who were damaged thereby.

The complaint alleges that defendants Mattel, Inc. and The Learning
Company and certain of their officers and directors violated the federal
securities laws (Sections 10(b) and 20(a) of the Securities Exchange Act
of 1934) by issuing a series of false statements and failing to disclose
material facts throughout the Class Period. Defendants' false statements
concerning the acquisition by Mattel of The Learning Company
artificially inflated Mattel stock during the Class Period to as high as
$ 30-5/16 per share during the critical acquisition pricing period
between April, 1999 and May, 1999. Defendants falsely represented that
The Learning Company was an excellent strategic fit with Mattel's
business and that its acquisition would be immediately accretive to
Mattel's 1999 and 2000 results. Then, just a few months after The
Learning Company acquisition closed, Mattel disclosed that The Learning
Company had experienced millions of dollars in product returns and bad
debt write-offs and that The Learning Company would incur a $ 50 to $
100 million loss rather than the large profit forecast for third quarter

Any member of the proposed Class who desires to be appointed lead
plaintiff in this action must file a motion with the Court no later than
sixty (60) days from October 7, 1999. Class members must meet certain
legal requirements to serve as a lead plaintiff. If you purchased Mattel
common stock during the Class Period or have questions or information
regarding this action or your rights, you may call or write: Barbara A.
Podell, Esquire SAVETT FRUTKIN PODELL & RYAN, P.C. 325 Chestnut Street,
Suite 700 Philadelphia, PA 19106 Telephone: (800) 993-3233 E-mail:
sfprpc@op.net TICKERS: NYSE:MAT

REPUBLIC NY: Shalov Stone Files Securities Suit In Penn
Shalov Stone & Bonner announced that a class action lawsuit has been
filed in the District Court for the Eastern District of Pennsylvania on
behalf of investors who purchased the securities of Republic New York
Corp. (NYSE: RNB)  between May 14, 1999 and September 15, 1999. The
defendants in the lawsuit are Republic Corp., Republic New York
Securities Corp. and William Rogers, who was recently terminated as an
officer of Republic Securities.

The lawsuit alleges that the defendants violated the federal securities
laws by, among other things: failing to disclose the participation of
Republic Securities and Rogers in a massive fraud spearheaded by
recently-indicted investment advisor Martin Armstrong; misrepresenting
the liabilities to which the defendants were exposed; and failing to
disclose the threat that the defendants' fraudulent activities posed to
the consummation of the pending merger between Republic Corp. and HSBC
Holdings PLC.

If you purchased the securities of Republic Corp. during the Class
Period, you may, no later than 60 days from October 7, 1999, file a
motion to serve as a lead plaintiff in this lawsuit. In order to serve
as lead plaintiff, you must meet certain legal requirements.

Plaintiff is represented by Shalov Stone & Bonner. Contact James Bonner:
by E-mail at Jim@lawssb.com or by telephone at 212-686-8004; or in
writing at Shalov Stone & Bonner, 276 Fifth Avenue, Suite 704, New York,
NY 10001.

SABRATEK CORP: Milberg To File 2nd Amended Securities Complaint In Ill.
By Order dated September 24, 1999, the United States District Court for
the Northern District of Illinois granted Milberg Weiss Bershad Hynes &
Lerach LLP, as Lead Counsel in the original pending securities fraud
class action (No. 99-C-0351) filed earlier this year against Sabratek
Corporation (Nasdaq: SBTKE), until October 15, 1999 to file a Second
Amended Complaint for violations of the federal securities laws against
Sabratek. Milberg Weiss had specifically sought the extension based on
Sabratek's delays in issuing its financial statements for the Second
Quarter ended June 30, 1999, in anticipation that Sabratek's disclosure
of its recent financial performance would "bring the story through to

This action was commenced in January 1999 and an amended complaint was
filed on June 7, 1999, which alleged that Sabratek and certain of its
officers and directors had committed securities fraud by, inter alia,
improperly reporting artificially inflated revenue in violation of GAAP
and by failing to disclose other improprieties relating to its sales

Based on recent events, Milberg Weiss, which has been investigating
Sabratek's activities since the Fall of 1998, intends to file a second
amended complaint to include additional allegations against the Sabratek
defendants and to include, inter alia, claims for damages for all
investors who purchased Sabratek common stock during an extended class
period up to and including October 6, 1999, rather than the previously
announced end date of August 23, 1999. The second amended complaint will
allege a common, continuous course of misconduct during the extended
class period, which will include all class periods in all pending
related actions, and will constitute the most inclusive such class

If you wish to discuss this action or have any questions concerning this
notice or your rights or interests with respect to these matters, please
contact Steven G. Schulman, William C. Fredericks, Russell J. Gunyan or
Michael A. Swick at Milberg Weiss at One Pennsylvania Plaza, 49th Floor,
New York, New York 10119-0165, or by telephone 1-800-320-5081, or via
e-mail: endfraud@mwbhl.com, or visit the firm's website at

TOBACCO LIITGATION: Industry Brings In Big Name For Next Phase Of Case
The tobacco industry has brought in some star power for the second round
of the Miami class-action smokers suit. The industry’s new lead counsel
is Dan Webb, a Chicago trial lawyer and former U.S. attorney for the
Northern District of Illinois.

Webb, who replaces Philadelphia lawyer Robert Heim as lead counsel, will
defend the industry in the second phase, now scheduled to begin Tuesday.
That phase will address whether individual plaintiffs who represent the
class of an estimated 500,000 Florida smokers are entitled to damages.

A win for the plaintiffs could pave the way for hundreds of thousands of
damage claims, and perhaps a punitive damage award against the industry
in the billions of dollars.

Webb, 54, a partner with the Chicago-based firm Winston & Strawn, is
considered one of that citys brightest legal luminaries. When you have a
major problem, he is the first man to see, says Jeffrey Cole, a Chicago
lawyer who worked with Webb in the U.S. attorneys office and who has
since tried cases against him. Everybody whos anybody, at some point,
has gone to him. That includes former U.S. Rep. Dan Rostenkowski, who
tapped Webb to defend him against embezzlement charges in 1994.

Webb also was a special prosecutor during the Iran-contra scandal,
bringing an obstruction of justice case against Navy Adm. John
Poindexter, and, in the process, cross-examining former President Ronald
Reagan in a deposition. In 1997, Webb headed up a task force to
investigate allegations of widespread police brutality against the
Chicago Police Department. Just last month, Webb was considered a
candidate to lead an independent probe into whether the FBI improperly
used deadly force in its assault on the Branch Davidian compound in
Waco, Texas, in 1993. U.S. Attorney General Janet Reno eventually
selected former U.S. Sen. John Danforth to conduct the investigation.

Webb is no stranger to tobacco work. He has defended Philip Morris Cos.
in individual smoker lawsuits in Jacksonville and Tampa and represented
the cigarette maker in the state of Texas suit to recover Medicaid funds
expended to treat smoking-related illnesses.

Webb declined to comment for this article, citing a court order in the
Miami tobacco case that prevents lawyers for both sides from talking
with media.

Frequently mentioned in Chicago as a candidate for a federal judgeship
or political office, the boyish-looking Webb is variously described in
media reports as warm, personable, press-savvy and brilliant.

Cole, who also serves as executive editor of the American Bar
Associations Litigation magazine, says that Webbs greatest strength lies
in his unassuming personality, which is rooted in his Southern Illinois
childhood. He has an appeal that is quite unique, Cole says. Theres a
likability about him in the courtroom. Theres the genuine quality of the
boy next door. Juries like him.

The industry needs a little juror tenderness at the moment, because, to
date, the jury that has heard the evidence in the class-action smokers
case has done nothing but side with the plaintiffs. In July, the
six-member Miami-Dade Circuit Court panel found that the industry for
decades had lied about the health effects of smoking and had
intentionally marketed an unsafe product.

During the first phase, Heim, the former lead counsel, was assisted
primarily by Miami lawyer Edward Moss of Shook Hardy & Bacon. Moss, too,
has left the case, replaced by Adorno & Zeder lawyer Anthony Upshaw.

Miami lawyer R. Benjamine Reid of the law firm Carlton Fields will
remain on the case, and has been assuming a more active role in the
courtroom alongside Webb as the parties prepare to resume trial.
(Broward Daily Business Review 10-7-1999)

UNISTAR FINANCIAL: TX Securities Fraud Case Assigned to Judge Fitzwater
The Law Offices of Steven E. Cauley announced that the securities fraud
lawsuit filed in the United States District Court has been assigned to
Judge Sidney A. Fitzwater of the Northern District of Texas. The class
action lawsuit has been filed on behalf of purchasers of Unistar
Financial Service Corp. (Amex: UAI) common stock between October 15,
1998 and July 23, 1999, inclusive.

The complaint contains several allegations of wrongdoing, including the
central allegation that the Company valued its Customer List well in
excess of fair market value thereby overstating its assets and earnings.
When this information was partially revealed on July 20, 1999, Unistar
declined nearly 55% in price and was halted from trading and has not
traded since then. According to the complaint, the false representations
enabled the defendants to: a) exchange $75 million worth of Unistar's
artificially inflated common stock to satisfy a debt, and b) sell,
exchange or transfer 16.2 million shares of Unistar at artificially
inflated prices.

If you wish to serve as one of the lead plaintiffs in this lawsuit you
must file the appropriate motion with the court on or before October 17,
1999. To ensure your motion is received in time, you should contact the
attorney of your choice by October 12, 1999. Contact Steven E. Cauley
Scott E. Poynter Gina M. Cothern 2200 N. Rodney Parham Road Suite 218,
Cypress Plaza Little Rock, AR 72212 E-mail: CauleyPA@aol.com
1-888-551-9944 - toll free

WICKES INC: Defends Vigorously Some Asbestos Suits In MI, Settles Some
The Company is one of many defendants in approximately 100 actions, each
of which seeks unspecified damages, in various Michigan state courts
against manufacturers and building material retailers by individuals who
claim to have suffered injuries from products containing asbestos. Each
of the plaintiffs in these actions is represented by one of two law
firms. The Company is aggressively defending these actions and does not
believe that these actions will have a material adverse effect on the
Company. Since 1993, the Company has settled 16 similar actions for
insignificant amounts, and another 186 of these actions have been
dismissed. As of April 30, 1999 none of these suits have made it to

Losses in excess of the $152,000 reserved as of March 27, 1999 are
possible but an estimate of these amounts cannot be made.

WICKES INC: Faces Securities Suit In Del. Over Unfair Sale Of Shares
On November 3, 1995, a complaint styled Morris Wolfson v. J. Steven
Wilson, Kenneth M. Kirschner, Albert Ernest, Jr., Claudia B. Slacik, Jon
F. Hanson, Robert E. Mulcahy, Frederick H. Schultz, Wickes Lumber
Company and Riverside Group, Inc. was filed in the Court of Chancery of
the State of Delaware in and for New Castle County (C.A. No. 14678). As
amended, this complaint alleged, among other things, that the sale by
the Company in 1996 of 2 million newly-issued shares of the Company's
Common Stock to Riverside Group, Inc., the Company's largest
stockholder, was unfair and constituted a waste of assets and that the
Company's directors in connection with the transaction breached their
fiduciary duties. In March 1999, by stipulation among the parties, this
complaint was dismissed without prejudice.

WICKES INC: Sued Over Health Problems Caused By Silica Dust
The Company is one of many defendants in two class action suits filed in
August of 1996 by approximately 200 claimants for unspecified damages as
a result of health problems claimed to have been caused by inhalation of
silica dust, a byproduct of concrete and mortar mix, allegedly generated
by a cement plant with which the Company has no connection other than as
a customer. The Company has entered into a cost sharing agreement with
its insurers, and any liability is expected to be minimal.

* Bill Boosting Patient Rights Okayed By House

A far-reaching package of patient protections overwhelmingly passed the
House last Thursday over the objections of Republican leaders, who urged
members to vote for a more modest measure.

The bill, one of four competing measures considered by the House, passed
by a vote of 275 to 151--a far wider margin than had been expected,
underscoring the grass-roots momentum of the issue and the desire of
House members to be on record in favor of restraining health maintenance
organizations before next year's election.

For Democrats and the White House, the vote was a triumph on a signature
issue for the party and one that they had pushed for the last three
years. This time, they fought efforts by the Republican leadership to
weaken the provision that would allow patients who are injured to
recover damages from their health plans in court.

The vote represented "a major victory for every family in every health
plan," President Clinton told reporters in New York. He praised the
bipartisan coalition that pushed through the bill.

The House measure, which was co-sponsored by Rep. Charlie Norwood
(R-Ga.), a dentist, and Rep. John D. Dingell (D-Mich.), the most senior
member of the House, was passed after three other, more limited
alternatives were defeated.

In all, 206 Democrats voted for the bill, along with 68 Republicans and
one Independent. Just two Democrats, both from Kentucky, opposed the

The bipartisan bill offers patients a long list of protections,
including guaranteed payment for emergency care, the right to see
specialists, the right to independent medical review of health plan
denials and the right to sue a health plan in state court. Lawsuits
brought under state laws would be subject to whatever caps on damages
the state had in place.

If the bill becomes law, California's recently enacted liability law
would remain undisturbed, because the House bill would provide that
patients may sue in state court under state rules. However, Californians
could get more rights under the legislation than they now have in
several areas, including access to clinical trials and access to care by
medical specialists, experts said.

"It is time we asked the insurance industry to be responsible for its
actions," said Norwood, who has pushed for the legislation for years in
defiance of his party's leadership.

Groups representing health plans sharply criticized the House vote,
pointing out that even without broader rights in court, more lawsuits
are being filed against the industry--including two filed this week
against Aetna/US Healthcare that claim the company failed to live up to
its obligations to members. Both suits seek class-action status.

" House members may have cast a vote against health plans today, but the
people who are going to pay the bill are working families," said Karen
Ignagni, president of the American Assn. of Health Plans. "We've seen
two suits filed this week . . . and even though we think we are going to
win, working families are going to absorb the cost of defending them."

Republican leaders warned that, if the bipartisan bill should become
law, trial lawyers would be major beneficiaries. They said that the cost
of health care would increase and that quality of care would be little

While many Republicans said that they could support new, strict rules to
help ensure that patients get the health care they need from their
managed-care plans, they called the House bill's approach extreme.

"Trying to keep a balance is the task before this House," said Speaker
J. Dennis Hastert (R-Ill.). The difference between the bills is in how
far they go to "give license to the trial lawyers. . . . No one has any
idea what the cost will be when you go too far."

Despite the lopsided vote in the House, the bill's prospects of becoming
law are dim at best. The Senate version of the patient protection
measure--with which the House bill must be reconciled--would cover far
fewer people and is weaker on almost every provision, making compromise
particularly difficult.

"You don't see too many cross-breeds between Chihuahuas and great Danes
walking around," said Rep. William M. Thomas (R-Bakersfield).

Employers, health insurers and HMO executives, who have spent several
million dollars battling every patients' rights bill over the last
couple of years, said they were committed to trying to kill the
liability provisions--if not the entire bill--in the House-Senate

"To see nothing come out of conference is my hope," said Bruce Josten,
executive vice president for government affairs for the United States
Chamber of Commerce. "The best outcome is no outcome."

Senate Majority Leader Trent Lott (R-Miss.) said that House-Senate
conferences on other legislation have a higher priority and that
resolving the differences on this bill "would take some time."

Asked if he could envision the Senate's embracing any expansion in
health plans' liability, Lott said: "I can't think of any circumstance
where I'd like more lawsuits."

Dingell, who is viewed as one of the masters of the legislative game,
said that he had no plans to celebrate before a Rose Garden ceremony
where the bill would be signed into law. "The time for rejoicing is
really not here. We have to go back to work," he said.

Doctors, who lobbied hard for the legislation, flying in physicians from
members' districts for personal meetings and walking the halls of
Congress as recently as a week ago, were jubilant at their surprise
victory but resolved to continue their effort with the conference

The American Medical Assn. "has fought for five years to see this kind
of legislation passed," said Thomas R. Reardon, president of the group.

"Today we are one giant step closer to a law that allows physicians to
make medical decisions, that allows patients to appeal if their care is
delayed or denied. . . . Let's finish the job."

Passage of the strong bill by the House reflects a combination of
factors--several of them unique to the managed health care debate.
Perhaps most striking was the populist power of the issue itself, which
appears to have caught the GOP leadership by surprise.

The insurance industry complained loudly and with some justification
that horror stories told by advocates of patients' protections failed to
represent the broad satisfaction of most patients with their health

However, because of lawsuits and media accounts of patients deprived of
care by HMOs, even those who personally have had good experiences with
their health plans were made nervous about what would happen if they
needed costly care. Both Republicans and Democrats spoke in debate about
constituents who had been denied care by their health plans--with
catastrophic results.

"Some of these horror stories . . . have resonated with members," said
Rep. Ray LaHood (R-Ill.), noting that the patients' rights issue is
likely to have significant impact in some districts in next year's

"There was an underestimation of how deep the backlash was against
managed care," said Mark Peterson, a political scientist at UCLA's
School of Policy Studies. "It turns out there's a pervasive fear among
the middle class about what their prospects would be if they got sick."

For Republicans, the issue presented a political minefield, and even
when their leaders decided to back a bill with narrow liability
provisions, they did so only halfheartedly.

Rank-and-file Republicans were all over the map on the issue, making it
difficult for Hastert to marshal them around one plan. The staunchest
conservatives objected to even the narrowest liability provisions and
their 'no' votes helped doom the alternative bill backed by the

Further complicating matters were divisions among the business groups
and health insurers, from whom the leadership sought signals on how far
to go in regulating the managed-care industry.

The insurers were staunchly opposed to supporting any measure that
increased their vulnerability to lawsuits. The Chamber of Commerce
opposed the bill backed by the leadership.

"Mostly the insurance industry was not willing to concede that this
stringent liability could ever pass, and thus would never look for the
middle ground," said a senior business lobbyist.

The result was that, when the leadership finally endorsed one of the
bills, there was just 48 hours until the floor debate--too little time
to round up votes to pass the plan.



House: All Americans with private health insurance.

Senate: Many provisions apply to 48 million people in a specific health
plan--known as self-insured health plans--regulated only by federal law.
These plans are often set up and run by large companies.


House: Lifts federal ban on lawsuits for Americans in health plans that
fall under federal regulation.

Senate: No new rights to sue.


House: Prompt access to medical specialists. No prior approval on
emergency-room care.

Senate: Prompt access to medical specialists. No prior approval on
emergency care. But both provisions apply only for the 48 million in
self-insured plans. (Los Angeles Times 10-8-1999)

* Blue Cross Issues Statement On Patients Bill Of Rights
The following is a statement by Patrick G. Hays, president and CEO of
the Blue Cross and Blue Shield Association (BCBSA).

During the same week in which it was announced that 1 million additional
Americans are without health insurance, it is appalling to see the House
of Representatives adopt legislation that will lead to an additional
increase in the number of Americans without health insurance. While
BCBSA and its member Plans agree with Congress, and now several
presidential candidates, that health care must be an issue for debate on
the national stage, we disagree with the path taken by the House of
Representatives in its vote to pass the "Patients Bill of Rights." BCBSA
firmly believes that in these times of economic prosperity the American
public would be better served if Congress focused all its legislative
energies debating ideas on how to help those who do not have health

Moreover, while some of the provisions of the "Access to Quality Health
Care Act" passed yesterday would improve access to health care, the
provision which exempts multiple employer welfare arrangements and
association health plans from state consumer protection, affordability,
and solvency laws would result in more uninsured.

All 50 states have enacted legislation to improve access to coverage in
small group markets. Earlier this week the U.S. Census Bureau announced
that the number of uninsured Americans had grown to 44.3 million.
According to the Census report, among working Americans who do not have
insurance, the greatest concentration are low wage workers in firms
employing less than 25 employees. This trend has not changed since the
last census report.

Our Board of Directors approved a policy announced in February of this
year calling on Congress to target low wage workers in small firms. This
proposal would provide tax credits to employers for their low-income
workers to purchase health insurance. It also recommends full
deductibility for self- employed individuals, full deductibility for
individuals who do not have access to insurance through work and grants
to states for targeted programs for hard to reach populations. And
because of price sensitivity, BCBSA also believes that Congress must
adopt a litmus test -- opposing legislation that will increase the cost
of health care for Americans and thus the number of uninsured.

This is not what the House did today. Despite its intentions, the House
has taken the opposite step. Most disturbing about the "Patients' Bill
of Rights" is the expanded liability provision included in the bill.
Recent class action lawsuits filed by a small group of trial attorneys
points out the risk of expanding health plan liability -- even more
lawsuits to come. It will cost the industry millions to defend itself
and more if we lose. The health insurance industry does not have deep
pockets. To defend our customers and ourselves we will have to spend
premium dollars that would otherwise go toward paying for more health
care, and in the end the loser will be the American public who will pay
the ultimate price through higher premiums. It is the goal of Blue Plans
to help their members and families achieve and maintain their best
possible health. Even if the federal government adopts legislation that
impedes our ability to meet this goal, as we have for 70 years, Blue
Plans will continue to work toward this objective. BCBSA is a federation
of independent, locally operated Blue Cross and Blue Shield Plans that
collectively provide health care coverage to 73.2 million - one in four
- Americans. (SOURCE Blue Cross and Blue Shield Association)

* CNN Coverage On the Patients’ Bill of Rights Passed on Oct. 7, 1999
Broadcast on October 8, 1999 on Cable News Network

    LEON HARRIS, CNN ANCHOR: So there is still a long way to go before
any patients' bill of rights does become law.

And joining us from Washington now is Karen Ignagni. She is president
and CEO of the American Association of Health Plans. That's a trade
association for the managed-care industry.

Now, previously, Ms. Ignagni, as I understand it, you were a staff
member of the Senate committee that oversees health-care policy, so it's
possible that you see this Patients' Bill of Rights from both sides.
What do you make of what happened, yesterday?

thank you, Leon, first of all, for the opportunity to talk with you
about this.

I think that this, yesterday, signaled the end of the political phase of
this issue. And now we're going to begin the had work of trying to put
together a policy alternative that's balanced, that's reasonable and
meets the needs of the American people.

From our members, you're going to hear unequivocally that we believe in
the importance of patient rights. We get it. We hear what consumers are
saying. We know that they want to have trust and confidence in the
system. We believe there's a way to do that. We believe...

    HARRIS: Well, then why were you fighting -- if you agree with all
that, then why fight the bill as hard as the industry did?

    IGNAGNI: Well, we believe there's a way to do it which is not what
the House of Representatives did, yesterday. We believe that the way to
do this is through objective, independent review, not through sending
the courts -- more cases to court and relying on the courts to secure
quality. Just on the way over year, I heard a trial lawyer very, very
excited about all the new possibilities to increase suits against health

The members of the House of Representatives may think they passed a vote
against health plans, yesterday. Right behind us are the working men and
women who are depending upon us for affordable health- care. Every
dollar paid for defending suits will be passed on, and that's something
that the members of Congress have not yet confronted. But I do believe
they will confront it.

    HARRIS: Is -- well, is that the only issue, then, that the industry
has with the bill that's passed, yesterday, this right to sue issue?

    IGNAGNI: That's the primary issue. There are other matters that will
be talked about throughout the process, but that receives so much
attention, I really want to zero in on that. But I also want people to
understand that we're going to be working very, very actively to talk
about what we're for. I think the American people want to hear that.
They also want to hear why we're so concerned about the liability
provisions. It's not what it appears, and I think that it moves the
health-care system in exactly the wrong way, and you can ask...

    HARRIS: Why is that?

    IGNAGNI: Well, you can ask any physician in this country who will
give you compelling evidence that the malpractice system has not worked.
In fact, it's driven up health-care costs, it's led to a diminution of
quality, unnecessary procedures, defensive medicine.

    HARRIS: But if I -- but I have to add that -- I have to mention that
the American Medical Association, a group of doctors, was actually for
this bill, they actually signed it against the industry.

    IGNAGNI: Yes, I'm puzzled by that. Let me tell you why. Just several
days ago, over the last several days, we've had three class- action
suits prior to any passage of new legislation filed against health
plans. One of them in particular went after the way health plans
reimburse physicians, and essentially what they're -- the lawyers are
saying is, that the physicians here are either committing negligence at
best or fraud at worst. I think the doctors are going to be watching
this very closely and maybe sending different messages to their
associations about what's at risk for them, too.

    HARRIS: Well, we'll be listening for those messages, ourselves,
here, at CNN. Thank you so much, Karen Ignagni.

    IGNAGNI: Thank you. Thank you for the opportunity.

    HARRIS: No problem. Talk to you later on.


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