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

                 Tuesday, November 30, 1999, Vol. 1, No. 210

                                  Headlines

ALLIANCE SEMICONDUCTOR: Fights for Dismissal of CA Securities Claims
ASSEMBLY MEMBERS: Japanese Matsue Ct Orders Return of Allowances
BONE SCREW: Maker AcroMed May Not Transfer Claim to MDL Settlement Ct
BRISTOL POINTE: Kendall Gate Homeowners Allege Flaws & Missing Features
DETROIT EDISON: Becomes Coalition's Partner Settling Employee Bias Suit

GUARANTEE LIFE: Intends to Vigorously Defend Policyholders' Suit in CA
GUN MANUFACTURERS: Coverage Denial on Rise As More Suits Are Filed
JUST FOR: Milberg Weiss Files Securities Suit in Alabama
NAVIGANT CONSULTING: Berman, DeValerio Files Securities Suit in Il.
NAVIGANT CONSULTING: Cohen, Milstein Files Securities Suit in Illinois

NAVIGANT CONSULTING: Hagens Berman Files Securities Suit in Illinois
NAVIGANT CONSULTING: Schiffrin & Barroway File Securities Suit in Il.
NAVIGANT CONSULTING: Wolf Popper Files Securities Suit in Illinois
RIBOZYME PHARMACEUTICALS: Hill & Robbins File Securities Suit in Colo.
TOWNE SERVICES: Milberg Weiss Announces Securities Suit in Georgia

TRISTAR CORP: Settles Securities Suit Re Pre-1992 Ownership of Sheth Gp
TURNER: Advocates Say Hearings For Welfare Benefits in NY are Unfair
USA DETERGENTS: Discloses SEC Request for Documents and Testimony

* Crowe and Others Say Securities Fraud Is Rampant In Silicon Valley

                            *********

ALLIANCE SEMICONDUCTOR: Fights for Dismissal of CA Securities Claims
--------------------------------------------------------------------
In March 1996, a putative class action lawsuit was filed against the
Company and certain of its officers and directors and others in the
United States District Court for the Northern District of California,
alleging violations of Section 10(b) of the Securities Exchange Act of
1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder. The
complaint alleged that the Company, N.D. Reddy and C.N. Reddy also had
liability under Section 20(a) of the Exchange Act. The complaint,
brought by an individual who claimed to have purchased 100 shares of the
Company's common stock on November 2, 1995, was putatively brought on
behalf of a class of persons who purchased the Company's common stock
between July 11, 1995 and December 29, 1995. In April 1997, the Court
dismissed the complaint, with leave to file an amended complaint. In
June 1997, plaintiff filed an amended complaint against the Company and
certain of its officers and directors alleging violations of Sections
10(b) and 20(a) of the Exchange Act. In July 1997, The Company moved to
dismiss the amended complaint. In March 1998, the court ruled in
defendants' favor as to all claims but one, and dismissed all but one
claim with prejudice. In April 1998, defendants requested
reconsideration of the ruling as to the one claim not dismissed.

In June 1998, the parties stipulated to dismiss the remaining claim
without prejudice, on the condition that in the event the dismissal with
prejudice of the other claims is affirmed in its entirety, such
remaining claim shall be deemed dismissed with prejudice. In June 1998,
the court entered judgment dismissing the case pursuant to the parties'
stipulation. The Company intends to continue to defend vigorously
against any claims asserted against it, and believes it has meritorious
defenses. Due to the inherent uncertainty of litigation, the Company is
not able to reasonably estimate the potential losses, if any, that may
be incurred in relation to this litigation.


ASSEMBLY MEMBERS: Japanese Matsue Ct Orders Return of Allowances
----------------------------------------------------------------
In a landmark ruling, the Matsue District Court last Wednesday ordered
seven prefectural assembly members to return about 580,000 yen that was
paid to them as weekend allowances, when no assembly meetings were held.

Civil activists had filed a class-action suit with the court in 1996
against the assembly members of the prefecture's Matsue constituency,
seeking the return of 2.18 million yen they had received as allowances
for 8 weekends in 1995 and they had claimed that the payment was in
violation of the Local Autonomy Law as no assembly meetings were held on
those days.

Presiding Judge Mitsuo Yokoyama told the court that it was illegal for
them to receive allowances for days when they did not attend assembly
meetings. The court also decided that allowances only be paid on days
that the assembly members attend meetings. It was the first such
decision made by the court.

The Matsue court decision is expected to have a significant impact on
other local governments, as many of them provide allowances to assembly
members even for days when no meetings are held.

Koichi Kito, a representative of a civic ombudsman group, had initially
urged that the prefectural government examine the case, but the request
was rejected. Dissatisfied with the decision, Kito and other plaintiffs
filed a suit with the district court in April 1996.

The prefectural government revised an ordinance in May the following
year and stopped providing allowances for weekends. (The Daily Yomiuri
Nov-25-1999)


BONE SCREW: Maker AcroMed May Not Transfer Claim to MDL Settlement Ct
---------------------------------------------------------------------
Because a procedural error made its transfer from a state to a federal
court invalid, a lawsuit against pedicle screw maker AcroMed may not go
to the multidistrict court to become part of the global AcroMed
settlement before returning to state court, according to a West Virginia
federal judge. Lloyd v. Cabell Huntington Hospital Inc., No. 3:99-0433
(SD WV, July 29, 1999).

The U.S. District Court for the Southern District of West Virginia
remanded the case to the Circuit Court of Cabell County, WV.

In 1996, Melissa Lloyd underwent surgery at the Cabell Huntington
Hospital and was implanted with screws and rods manufactured by AcroMed.
She filed suit on April 19, 1999, in Cabell County Circuit Court,
alleging the screws and rods were defective and seeking damages under
various theories of liability.

AcroMed removed the action to the Southern District of West Virginia
based on federal question jurisdiction. However, AcroMed failed to
obtain consent for the removal from its co-defendant, Cabell Huntington
Hospital.

In 1997, the U.S. District Court for the Eastern District of
Pennsylvania, where the pedicle screw multidistrict litigation is based,
approved a limited fund class action settlement of claims against
AcroMed.

Because Lloyd is a presumptive member of this class and plaintiffs are
not permitted to opt out of the settlement, AcroMed moved that the
federal court stay proceedings pending transfer to the Eastern District
of Pennsylvania. Lloyd moved to remand the case to the state court on
the grounds that AcroMed failed to notify its co-defendant of the
removal.

The Southern District of West Virginia found that, in general, all
defendants must join in the notice of removal. AcoMed argued that all
defendants do not have to join in notice of removal when the claim being
removed is "separate and independent" from those against the
codefendant. The court found these claims were not separate and
independent because they all stemmed from the same medical operation.
Since the court could not stay proceedings over which it has no
jurisdiction, the court remanded the case to the state court.

Lloyd was represented by Marvin W. Masters of Masters & Taylor in
Charleston, WV. Appearing for Cabell Huntington was Roger D. Hunter of
Neely & Hunter in Charleston. (See Document Section F for the five-page
opinion.)(Medical Devices Litigation Reporter, Vol. 6; No. 9; Pg. 14,
Oct-7-1999)


BRISTOL POINTE: Kendall Gate Homeowners Allege Flaws & Missing Features
-----------------------------------------------------------------------
Dozens of homes in Kendall Gate are less than 2 years old, but you might
not know it from looking at them, angry residents say. Balconies are
cracking, streets are sinking, and the only water that comes into the
fountain in the park falls from the sky. On top of that, many of the
common amenities the residents thought they were promised when they
bought their homes were never built.

Now at least 23 homeowners in the community north of Kendall Drive near
159th Avenue have banded together to fight back.

Their target: Bristol Pointe Developers, a one-project construction
corporation controlled by the Capo family, better known as the owners of
the El Dorado furniture store chain in Miami. Sydney Brodie, an attorney
for Bristol Pointe, said he tried to contact the Capos for a response to
the complaints but was informed they were all out of town. "This is
first I've heard of these complaints," Brodie said. "No one bothered to
come talk to me, and everyone did their closing at this office. You hear
typical things at all closings, like you need a little touch-up paint
here or this door needs fixing, little things, but this is the first
I've heard of these."

But homeowners say their complaints go far beyond little things. "I have
never been more stressed in my life," said Ana Munoz of 16042 SW 86th
Ln. "Everybody bought their house because it was going to be a walled
and gated community. None of it has happened."

A Kendall Gate brochure lists many attractive features prospective
homeowners could expect, including an elegant perimeter wall, impressive
entrance features with a guardhouse, and an electronic gate.

Instead, Bristol Pointe put up a wire link fence and put nothing in the
entrance. One car has already crashed through the fence from Kendall
Drive into a back yard, residents said.

When homeowners complained, Munoz said, they were directed to read the
small print at the bottom of the brochure: "The features contained on
this page are representative only and the Developer reserves the right
without notice to or approval by the Buyer to make changes and
substitutions of at least equal quality for features, materials and
equipment itemized herein."

Said Munoz: "I don't think a fence is the same as a wall. And the
guardhouse is not even there." She points out the missing features are
only half the problem. Rainwater passes easily through cracks in the
homes' balconies, and it collects in mosquito-infested pools in a broken
fountain in the middle of a central park. The brand-new streets are
riddled with sinkholes.

"The entire thing has been a disaster," said Lourdes Guerra of 16041 SW
86th Lane. "I've been complaining for two years, but they don't care. We
need to move on. We are going to get together as many people as possible
to get a lawyer and try to do something."

The residents said they have been seeking an attorney who will take fees
only if a settlement is reached, but have so far been unable to find
one.

But Ervin Gonzalez, who is already representing homeowners in Las
Mansiones, a Hialeah development built by another developer controlled
by the Capo family, said they just haven't asked the right firm -- such
as his, Robles & Gonzalez. "Working-class people can't afford a lawyer
if they are charged an hourly rate," he said. "We take a percentage of
the settlement because otherwise no one could afford us and people
selling homes that are not proper or not safe will get away with it."

In the pending class action suit against the Capo-controlled H.C.C.
Development, Las Mansiones homeowners are alleging that the fill under
their homes contained trash, causing the houses to sink and crack.

The case is on hold while the Florida Supreme Court decides an unrelated
case argued in March over whether a developer can be sued for violating
the building code.

"That's what we're looking for, someone who doesn't charge right now but
until the settlement," Guerra said. She asked for Gonzalez's telephone
number.

For more information, visit the NewsHound website at
http://www.newshound.comor send an email to speak@hound.com.


DETROIT EDISON: Becomes Coalition's Partner Settling Employee Bias Suit
-----------------------------------------------------------------------
Detroit Edison and the Asian and Middle-Eastern American Coalition,
which represents Asian and Middle-Eastern communities in Southeastern
Michigan, have formed a partnership to enhance the utility's leadership
position in Asian and Middle-Eastern communities. The partnership is
part of a settlement of employee pay and promotion claims by Asian and
Middle-Eastern employees of Detroit Edison.

Specific monetary settlements relating to resolution of those claims
remain confidential under the terms of the agreement. The agreement
follows a year of negotiations between eight named Detroit Edison
employees and the company over allegations of discrimination in
promotion practices at the utility.

"Through this settlement, we are raising the bar on our partnership
commitment to the communities we serve," said Robert J. Buckler,
president and chief operating officer, DTE Energy Distribution. "The
partnership puts in place programs related to more focused job
opportunities and community involvement. It will include measures and
targets to guide us toward enhancing even further the diversity of our
employee and supplier bases to better serve the community."

The agreement provides:

Programs to enhance the recruiting and hiring of Asian and
Middle-Eastern employees; broadening of procurement scope to include
more Asian and Middle-Eastern suppliers; increased support of
coalition-member community organizations; increased advertising in Asian
and Middle-Eastern media to enhance the utility's Ethnic Marketing
activities; and an initiative to increase the availability of the Asian
and Middle-Eastern workforce to Detroit Edison, starting with hiring,
student programs and scholarships.

A program to address future promotion and salary issues of 89 current
Middle-Eastern and Asian employees for a five-year period, as well as
use of training and development programs.

"We as employees thank Detroit Edison for their commitment to enforce
justice and equality within the company and the community," said Raza
Babar, a Detroit Edison employee and named plaintiff in the class action
effort. "Also, as Detroit Edison employees, we express our appreciation
to the community, which stood with us and lent great support during this
difficult period. We believe that the settlement is the start of a new,
successful and enriching relationship between the Asian and
Middle-Eastern communities and Detroit Edison."

The partnership efforts reflected in the settlement will build on
Detroit Edison's existing involvement in the Asian and Middle-Eastern
communities, including an extensive ethnic marketing program,
partnership school activities, recruiting, leadership roles within the
Asian and Middle-Eastern American business and community organizations,
and sponsorship of community events.

"We applaud both the plaintiffs and Detroit Edison for their willingness
to negotiate a fine agreement and a good outcome to this case," said
Hala Maksoud, president of the American-Arab Anti-Discrimination
Committee. "Once again, this shows that members of the Arab-American
community can and should turn to the courts when they feel that their
rights have been violated. We are delighted with the outcome of this
case."

The Asian and Middle-Eastern American Coalition is comprised of the
American-Arab Anti-Discrimination Committee, the Arab-American Political
Action Committee, the Chaldean Federation of America, the Asian Center
of Justice and the Council of Islamic Organizations of Michigan.

Detroit Edison is the state's largest electric utility, serving more
than 2 million customers in Southeastern Michigan. Detroit Edison's
parent company, DTE Energy Co. (NYSE: DTE), is a Detroit-based
diversified energy company involved in the development and management of
energy-related businesses and services nationwide. Source: Detroit
Edison. Information about DTE Energy is available on the World Wide Web
at http://www.dteenergy.com


GUARANTEE LIFE: Intends to Vigorously Defend Policyholders' Suit in CA
----------------------------------------------------------------------
On November 17, 1999, Bradley Baymiller, Shirley Baymiller, Ernest
Benck, Elizabeth Breemer, Chester Neville and Susan Neville filed a
lawsuit in Orange County, California Superior Court against The
Guarantee Life Companies Inc. ("Guarantee Life"), Guarantee Life
Insurance Company and Guarantee Mutual Life Company. The suit seeks
recognition of a class action on behalf of all persons who held an
ownership interest in a participating life insurance policy issued by
the defendants from January 1, 1980 to the present.

The plaintiffs allege breach of contract, breach of the implied covenant
of good faith and fair dealing, fraud and violation of the Unfair
Competition Act in the sale of certain participating life insurance
policies using policy performance illustrations which used then current
interest or dividend rates and insurance charges and illustrated that
some or all of the future premiums might be paid from policy values
rather than directly by the insured. The plaintiffs also allege that the
defendants artificially adjusted dividend/credit interest rates and
mortality rates to the detriment of the plaintiffs. Unspecified
compensatory and punitive damages, costs and equitable relief are
sought. Management believes that Guarantee Life made the appropriate
disclosures to policyholders as a matter of practice and at this
preliminary stage does not believe the lawsuit has merit and intends to
vigorously defend its position.


GUN MANUFACTURERS: Coverage Denial on Rise As More Suits Are Filed
------------------------------------------------------------------
As gun companies fight to survive an onslaught of city lawsuits and
renewed interest in gun control, they have encountered yet another
powerful adversary--their own insurers.

With cases against the industry going forward in 28 cities and states,
the legal defense costs already are in the millions of dollars and
climbing. Gun companies, like any insured business, looked to their
insurers to pay for their defense and contribute to any necessary legal
settlements or judgments.

But many firearms makers and sellers have been notified by their
insurers that they have no intention of paying what could be
astronomical legal bills or any judgments associated with the suits.

Separately, a number of smaller gun companies that had trouble getting
insurance in the first place have discovered that their insurer, Leeds &
London Merchants Insurance, was not licensed to sell insurance in many
states and is now going out of business. Several of the companies Leeds
& London insured have filed for bankruptcy protection from creditors.
Now that Leeds & London is also going out of business, that leaves
individuals who've sued those companies in product liability cases
little hope of ever recovering damages.

Several lawsuits already have been filed by industry members against
their underwriters in what some gun company officials say could be the
beginning of an all-out war between insurers and gun companies.

"It'll bankrupt them all," said Daniel Abel, an attorney in the Safe-Gun
Group, an organization of New Orleans lawyers suing gun companies. "If
the insurers walk away from the gun companies, they are looking at
defending themselves in 28 major lawsuits."

The insurance issue is "crucial," said Robert L. Carter, an insurance
coverage lawyer at McKenna & Cuneo in Washington. "The gun companies are
right now looking at the tobacco litigation and asking whether their
companies are viable. . . . Insurance is the last safe harbor for the
gun companies."

In September, Maryland's Beretta U.S.A. Corp. sued its insurer, Chubb
Corp., in federal court in the Northern District of Maryland after Chubb
refused to contribute to Beretta's defense. The National Shooting Sports
Foundation also sued Nationwide Mutual Insurance over its refusal to pay
the industry association's defense costs in a case pending in New
Orleans. In that case, the judge ordered the insurer to pay.

Gulf Insurance of New York has stopped writing policies for gun
companies, and Frontier Insurance said it no longer will be a player in
insuring gun shops. Insurance for gun companies will become scarcer and
more expensive, said Robert Hartwig, vice president of the Insurance
Information Institute in New York. "It's very difficult to find
insurance when your industry is in the midst of a crisis," Hartwig said.
"It's like trying to insure a house when it's in the path of an oncoming
hurricane."

Hartwig said that some insurers are active in defending their gun
company policyholders, although he wouldn't say which ones. Others, he
said, are denying coverage. "Many gun distributors and manufacturers are
hoping that judges will say insurers should come to their aid," he said,
adding that he doesn't think that one can assume that the coverage will
be there.

The insurance question has come up much more quickly for gunmakers than
it did in lawsuits brought against tobacco companies, in part because
gun companies' profit margins tend to be thin and they are much, much
smaller than the behemoth tobacco firms.

Tobacco companies spent $ 600 million a year on legal costs during years
of product liability lawsuits that led to class-action suits brought by
cities and states. Carter, who has studied the insurance issue in the
tobacco litigation, said that he ultimately expects the 1,400 insurers
who represent tobacco firms will have to pay out in excess of $ 20
billion for legal fees and settlements in the case.

However, Carter said, the asbestos cases are more closely related to the
gunmakers circumstances. In some of the asbestos lawsuits, the company's
insurer ultimately went out of business because they had to pay to
defend the firms. But many of the asbestos companies survived to go into
other businesses.

Gun companies have always found it difficult to get insurance because of
the nature of their products. Many of the big gunmakers are self-insured
by a Bermuda company, Sporting Activities Insurance Ltd., which was set
up expressly for gun manufacturers, who sit on its board. The firm
insures about 25 gun companies. But even the firm will not guarantee
that it will pay to defend its clients. "Some are going to be covered,
some are not," said David Pickering, a director and spokesman for
Sporting Activities. The firm provides product liability coverage, but
not general liability policies, he said.

Some gun control advocates see the insurance issue as a plus in getting
gun companies to try to avoid litigation and agree to make changes in
the industry. The insurance problem is "one more thing to bring them to
the [settlement] table," said Josh Horowitz, director of the Firearms
Litigation Clearinghouse, which tracks the lawsuits against gun
companies and aids cities in their suits.

But some manufacturers say they won't let the insurance issue force them
into a settlement. "Gun distributors won't carry your product if you
don't have insurance," said Tom Deeb, owner of Hi-Point Firearms, who's
insured by Sporting Activities. As for whether his legal bills will be
paid, he said he had not received an answer from his insurance carrier.
"Even if they did, I'm named in 15 lawsuits. So the deductible would be
$ 25,000 per incident, or $ 375,000," he said. For some gunmakers, the
deductible per case is as high as $ 1 million. "I don't have general
liability insurance," Deeb said. "I tried to get it for a year and
couldn't."

A few months ago, Deeb said he was seriously considering going out of
business because of the lawsuits, but has since changed his mind. "I
think what they're doing is wrong," he said of the mayors and
gun-control groups that support the lawsuits. "Even if it breaks me, I'm
going to stick it out and do everything I can to keep my people
working."

Many gun company officials are watching Beretta's case against Chubb
closely. "I've spoken to a number of manufacturers, and their insurers
have reserved their right to deny coverage," said Finley Harckham, an
attorney for Beretta. A spokesman for Chubb declined to comment on the
case.

In addition to the city lawsuits that have focused on gun companies,
there are numerous product liability cases that have been filed by
individuals against gunmakers, claiming that guns went off when dropped
or were in some way defective. Gunmakers also depend on insurers to
defend them in those cases.

Howard Holladay, 71, a U.S. agent for Leeds & London, insured many small
gunmakers who had difficulty getting insurance elsewhere. He went to the
annual Shot Show where gunmakers ply their wares to distributors and
retailers every year, befriending the owners of small gun companies and
selling them insurance. Though the name of the company Holladay
represents is strikingly similar to Lloyds of London, the huge British
insurance conglomerate, Leeds & London is actually registered in Costa
Rica, according to court documents.

One of the companies Holladay sold insurance to was American Derringer,
a small, Waco, Tex., firm that makes expensive derringers. When the
company ran into financial trouble, in part because of product liability
lawsuits, Holladay encouraged the owners to file for bankruptcy. "He
told me 'You should just file for bankruptcy and these lawsuits will go
away,' " said Elizabeth Saunders, owner of the company. "Well, they
don't go away."

Saunders reported Holladay to the Texas Board of Insurance for operating
in the state without a license to sell insurance.

Among other companies, Holladay insured two California gunmakers--Lorcin
Engineering Co. and Davis Industries Inc. Lorcin reorganized under
bankruptcy laws only to go out of business in California earlier this
year. Davis is operating under Chapter 11 bankruptcy protection.

Both companies had numerous product liability claims pending against
them that they told the court were covered by Leeds & London. Some of
Lorcin's lawsuits were settled, others are pending, according to the
bankruptcy court in Riverside, Calif.

But plaintiffs' lawyers who have sued Lorcin in recent years said their
investigation showed that Leeds & London had a capitalization of only $
80, according to court documents, and is not registered in any state in
the United States. The reason that states license insurers is to provide
financial backup in case the insurer goes out of business.

For those who have filed product liability claims against gun companies
that have filed for bankruptcy protection, the insurance issue is
central to whether they will ever collect money for their injuries or
deaths of family members.

"We've ruled them out," said Harry Gregory of any insurance assets from
Leeds & London. Gregory, a personal injury lawyer, sued Lorcin on behalf
of a man whose allegedly defective Lorcin gun went off and killed him,
leaving two children behind. "It's a scam. . . . We can't find them. We
went to the address in Costa Rica. There's nothing there."

Gregory's office recently was notified by a Bahamas liquidation firm
that Leeds & London "has suspended operations effective September 1,
1999." The liquidator, Ryan & Co., did not return a reporter's calls
requesting comment.

"We don't insure gun companies per se," said Holladay, reached in
Boston. "We're a private organization. We don't give out interviews," he
said, declining to answer any further questions.

Holladay, whose insurance concerns also cover amusement rides and other
hard-to-insure entities, signed a cease-and-desist order with the
Maryland Insurance Commission in 1994 after a Labor Department inspector
found that a traveling amusement show was insured by Leeds. But since
Leeds was not licensed in Maryland, the insurance certificate was
invalid.

Holladay also agreed not to sell insurance in Canada. "The only thing
worse than a gun company not having insurance is claiming you have
insurance," said Gregory, whose clients' only recourse will be to sue
the liquidated estate of Lorcin.

Meanwhile, James Waldorf, former co-owner of Lorcin, has started a new
gun business in Nevada. (The Washington Post Nov-26-1999)


JUST FOR: Milberg Weiss Files Securities Suit in Alabama
--------------------------------------------------------
The Following is an Announcement by the Law Firm of Milberg Weiss:

Notice is hereby given that a class action lawsuit was filed on November
24, 1999, in the United States District Court for the Southern District
of Alabama, on behalf of all persons who purchased or otherwise acquired
the common stock of Just For Feet, Inc. ("Feet" or the "Company")
(Nasdaq: FEETQ) between May 5, 1997, and November 1, 1999, inclusive
(the "Class Period").

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, at Milberg Weiss Bershad Hynes & Lerach ("Milberg Weiss"),
Steven G. Schulman or Samuel H. Rudman at One Pennsylvania Plaza, 49th
Floor, New York, New York 10119-0165, by telephone 1-800-320-5081 or via
e-mail: endfraud@mwbhlny.com or visit our website at www.milberg.com.

The complaint charges certain of Feet's senior officers and directors
with violations of Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges
that defendants issued a series of materially false and misleading
statements concerning the Company's operations and financial condition.
As a result of these materially false and misleading statements the
price of Feet common stock was artificially inflated during the Class
period. Prior to the disclosure of the adverse facts described above
Feet completed a $200 million debt offering and certain Company insiders
realized over $5.8 million in proceeds from the sale of Feet common
stock to the general investing public at artificially inflated prices.

If you are a member of the class described above you may, not later than
sixty days from November 19, 1999, move the Court to serve as lead
plaintiff of the class, if you so choose. In order to serve as lead
plaintiff, however, you must meet certain legal requirements. Contact:
Shareholder Relations Dept. E-Mail: endfraud@mwbhlny.com 1-800-320-5081


NAVIGANT CONSULTING: Berman, DeValerio Files Securities Suit in Il.
-------------------------------------------------------------------
Berman, DeValerio & Pease LLP a law firm specializing in representing
shareholders in class action lawsuits, issues the following press
release on November 24, 1999:

Navigant Consulting, Inc. (NYSE: NCI) ("Navigant" or the "Company") was
charged with misleading investors in a securities class action with
respect to the financial condition and business prospects of the
Company. The case was filed as a class action in the United States
District Court for the Northern District of Illinois, Eastern Division
on behalf of all persons and entities who purchased or otherwise
acquired the common stock of Navigant during the period May 6, 1999
through and including November 19, 1999 (the "Class Period").

The action charges that Navigant and certain of its officers
misrepresented its financial results for the first three quarters of
1999 by using an improper accounting methodology to artificially inflate
its growth rate. As alleged in the complaint, defendants' actions to
inflate the growth rate was part of a scheme to make the Company a more
appealing take-over candidate. The Complaint also charges certain
defendants with the making of large stock purchases of Navigant stock
with improper loans from the Company during the Class Period and shortly
before the Company announced that it was considering merger inquiries.
After the close of the Class Period, the Company announced the
resignation of its Chairman, Chief Executive Officer and President. In
addition, Navigant reported the dismissal of three other officers, each
of whom had purchased Navigant stock with loans from the Company.
Plaintiff seeks to recover damages on behalf of all those who purchased
or otherwise acquired Navigant common stock during the class period.

Under the federal securities laws you may, but not later than sixty days
from November 23, 1999, move the court to serve as lead plaintiff of the
Class, if you so choose. To serve as lead plaintiff, however, you must
meet certain legal requirements. You may contact the attorneys at Berman
DeValerio & Pease LLP to discuss your rights regarding the appointment
of lead plaintiff.

If you purchased Navigant common stock during the period of May 6, 1999
through November 19, 1999, and suffered a loss on your investment, you
may wish to contact the lawyers at Berman DeValerio & Pease LLP to
discuss your rights and interests: Glen DeValerio, Esq. Or Alicia Duff,
Esq., Berman, DeValerio & Pease LLP, One Liberty Square, Boston, MA
02109, (800) 516-9926 E-Mail: bdplaw@bermanesq.com
Website http://www.bermanesq.com


NAVIGANT CONSULTING: Cohen, Milstein Files Securities Suit in Illinois
----------------------------------------------------------------------
The law firm of Cohen, Milstein, Hausfeld & Toll, P.L.L.C. has filed a
lawsuit in the United States District Court for the Northern District of
Illinois on behalf of persons who purchased the common stock of Navigant
Consulting, Inc. (NYSE:NCI) during the period between May 6, 1999 and
November 19, 1999 (the "Class Period") inclusive.

The Complaint charges that Navigant violated the U.S. securities laws
by, among other things, improperly accounting for business combinations
which created a materially false and misleading impression that the
Company was growing at a faster rate than it actually was. Moreover,
defendants failed to properly disclose the substance and nature of $17
million in loans made to Navigant's top officers, and falsely
represented that a $10 million loan to defendant Robert P. Maher was for
a "real estate transaction," when the loan was to pay for $10 million in
Navigant common stock purchased in defendant Stephen J. Denari's name.

Plaintiff's counsel in this action -- Cohen, Milstein, Hausfeld & Toll,
P.L.L.C. -- has significant experience in prosecuting investor class
actions and actions involving financial fraud. The firm has offices in
Washington, D.C. and Seattle, Washington and is active in major
litigation pending in federal and state courts throughout the nation.
For more information on the firm, visit our website at www.cmht.com.

If you are a member of the class described above, you have 60 days from
November 23, 1999 in which to move the Court to serve as lead plaintiff,
if you so choose. In order to serve as lead plaintiff, however, you must
meet certain legal requirements.

If you have any questions about this notice or the action, or with
regard to your rights, please contact: Steven J. Toll, Esq., Matthew J.
Ide, Esq. or Tamara J. Driscoll, Esq. of Cohen, Milstein, Hausfeld &
Toll, P.L.L.C., 999 Third Ave., Suite 3600, Seattle, WA 98104,
1-888/240-1238 or 206/521-0080, or via e-mail to stoll@cmht.com,
mide@cmht.com, or tdriscoll@cmht.com


NAVIGANT CONSULTING: Hagens Berman Files Securities Suit in Illinois
--------------------------------------------------------------------
The following is an announcement by the law firm Hagens Berman P.S. on
November 23, 1999:

A class action has been commenced in the United States District Court
for the Northern District of Illinois on behalf of all purchasers of
Navigant Consulting, Inc. ("NCI") common stock during the period May 6,
1999 through Nov. 23, 1999 (the "Class Period").

The complaint charges NCI and certain of its current and former officers
and directors with violations of the federal securities laws.
Specifically, plaintiffs have brought claims under sections 10(b) and 20
of the Securities Exchange Act of 1934.

The complaint alleges that NCI and certain of its former officers and
directors participated in a fraudulent scheme by failing to disclose
that these officers and directors had improperly obtained large loans
from the corporation, that some of them had used these loan proceeds to
make "inappropriate" purchases of NCI stock, and that the former
Chairman and CEO of NCI had repaid such loan using a large portion of
his holdings of NCI stock.

Further, the complaint alleges that NCI misrepresented its financial
results for the first three quarters of 1999 by using an improper
accounting methodology to artificially inflate both its earnings and
growth rate, and by misapplying that improper methodology to further
exacerbate the problems.

Before the truth regarding these allegations was disclosed to the
market, NCI shares traded as high as $53-13/16 per share. After
publications challenged the propriety of NCI's accounting, and after NCI
was finally forced to publicly acknowledge and the fact that the company
had fired its Chairman and CEO and two other officers for "improper"
transactions in the Company's stock, NCI's shares traded at less then
$10.00 per share.

If you are a member of the Class described above, you may, no later than
60 days from November 23, move the Court to serve as lead plaintiff of
the Class, if you so choose. In order to serve as lead plaintiff,
however, you must meet certain legal requirements. If you wish to
discuss this action or have any questions concerning this notice or your
rights or interests, please contact plaintiffs' counsel, Steve W. Berman
or Karl P. Barth at Hagens Berman, P.S. at 206/623-7292 or toll-free at
888/381-2889 or via e-mail at Karl@Hagens-Berman.com.

Contact: Hagens Berman, P.S Steve W. Berman or Karl P. Barth,
206/623-7292 Toll-free at 888/381-2889


NAVIGANT CONSULTING: Schiffrin & Barroway File Securities Suit in Il.
---------------------------------------------------------------------
The following statement was issued Nov. 24 by the law firm of Schiffrin
& Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in the
United States District Court for the Northern District of Illinois on
behalf of all purchasers of the common stock of Navigant Consulting,
Inc. (NYSE: NCI), formerly known as Metzler Group, Inc. (Nasdaq: NETZ),
from February 22, 1999 through November 21, 1999, inclusive (the "Class
Period").

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 Schiffrin & Barroway, LLP (Stuart L. Berman, Esq.) toll free at
1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com.

The complaint charges Navigant, its former CEO, President and Chairman
of the Board with issuing false and misleading statements concerning the
Company's financial condition.

If you are a member of the class described above, you may, not later
than January 24, 2000, move the Court to serve as lead plaintiff of the
class, if you so choose. In order to serve as lead plaintiff, however,
you must meet certain legal requirements. Contact: Schiffrin & Barroway,
LLP Stuart L. Berman, Esq. 888/299-7706 (toll free) or 610/667-7706
e-mail: info@sbclasslaw.com


NAVIGANT CONSULTING: Wolf Popper Files Securities Suit in Illinois
------------------------------------------------------------------
The following is an announcement by the law firm of Wolf Popper LLP on
November 24, 1999:

A class action lawsuit has been filed by Wolf Popper LLP against
Navigant Consulting, Inc. ("Navigant") (NYSE: NCI), and certain of its
senior officers, in the United States District Court for the Northern
District of Illinois. The lawsuit was filed on behalf of all persons who
purchased Navigant common stock from May 6, 1999 through November 19,
1999.

The Complaint charges that Navigant violated the U.S. securities laws
by, among other things, improperly accounting for business combinations
by failing to include in Navigant's interim 1998 financial statements
the operating results for seven non-public companies that were acquired
by Navigant during the second and third quarters of 1998 and the first
quarter of 1999. Navigant's failure to include those operating results
in its historical financial statements created a materially false and
misleading impression that the company was growing at a faster rate than
it actually was. Moreover, defendants failed to properly disclose the
substance and nature of $17 million in loans made to Navigant's top
officers, and falsely represented that a $10 million loan to defendant
Robert P. Maher was for a "real estate transaction." In fact, the loan
was to pay for $10 million in Navigant common stock purchased in
defendant Stephen J. Denari's name. Those shares were purchased just
prior to the Company's announcement that it was exploring "strategic
alternatives, including a potential merger with a larger company."

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 days after November 23, 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., Michael A. Schwartz, Esq., or James A. Harrod,
Investor Relations Representative, WOLF POPPER LLP, 845 Third Avenue,
New York, NY 10022-6689, Telephone: 212-451-9620, 212-451-9642, Toll
Free: 877-370-7703, Facsimile: 212-486-2093, E-Mail:
rfinkel@wolfpopper.com or IRRep@wolfpopper.com or visit Website:
http://www.wolfpopper.com


RIBOZYME PHARMACEUTICALS: Hill & Robbins File Securities Suit in Colo.
----------------------------------------------------------------------
The following is an announcement by the law firm Hill & Robbins, P.C. on
November 24, 1999:

If you acquired shares of Ribozyme Pharmaceuticals, Inc. ("Ribozyme")
(Nasdaq: RZYM) between the close of trading on November 15, 1999 and
November 17, 1999, the law firm of Hill & Robbins, P.C. is required, by
federal law (Section 21D(a)(3)(A) of the Private Securities Litigation
Reform Act of 1995) to inform you of the following:

On November 19, 1999, a lawsuit was filed in U.S. District Court in
Colorado against Ribozyme and its CEO and President Ralph E.
Christoffersen. The lawsuit, which seeks nation wide class action
status, was filed on behalf of investors who acquired Ribozyme common
stock between the close of trading on November 15, 1999 and November 17,
1999 (the "Class Period").

The lawsuit alleges that defendants misled investors by issuing a false
press release on November 15 headlined "Colorado Pharmaceutical Co.
Makes Cancer Drug History," stating that Angiozyme, one of the Company's
drugs in development, "has taken an important step forward...making both
clinical history and industry news" and that a press conference will be
held on November 17 at which the Company's "CEO and President, Ralph E.
Christoffersen, Ph.D. ...will explain Angiozyme and its recent
history-making leap, an achievement which may be of great significance
to cancer patients everywhere." As a result, Ribozyme common stock
increased from $10 5/8 to as high as $22 per share. Ultimately,
investors discovered the Company had no "history-making progress" to
report but was merely announcing that Angiozyme had entered Phase I/II
testing -- a development the Company had twice previously indicated
would occur before the end of 1999. Ribozyme shares then declined to
close at $9 5/16 per share on November 17, 1999. The lawsuit seeks to
recover damages suffered by Ribozyme investors as a result of
defendants' improper conduct.

If you acquired Ribozyme shares during the Class Period, you may, no
later than January 21, 2000, seek to join this lawsuit as a named or
lead plaintiff. In order to serve as a named or lead plaintiff, however,
you must met certain legal requirements.

A copy of the complaint filed with the court detailing the
above-described allegations, as well as documents necessary to
participate as a named or lead plaintiff are available by contacting the
law firm of Hill & Robbins, P.C., at the address and phone numbers
listed below. You may apply for the role of named or lead plaintiff in
the lawsuit through your own counsel. At this initial stage, contacting
counsel and/or filling out a form with respect to the lawsuit are not
prerequisites to participating in any class recovery. If you have
questions concerning your rights or interests with respect to this
matter, please contact: Robert F. Hill, Esq., John F. Walsh, Esq., Hill
& Robbins, P.C. 1441 Eighteen Street, Suite 100, Denver, CO 80202,
Telephone: 303-296-8100, Fax: 303-296-2388, E-mail:
johnfwalsh@hillandrobbins.com or visit website at
http://www.hillandrobbins.com


TOWNE SERVICES: Milberg Weiss Announces Securities Suit in Georgia
------------------------------------------------------------------
The following was issued by the law firm of Milberg Weiss Bershad Hynes
& Lerach:

Notice is hereby given that a class action lawsuit was filed on November
24, 1999, in the United States District Court for the Northern District
of Georgia, on behalf of all persons who purchased or otherwise acquired
the common stock of Towne Services, Inc. ("Towne" or the "Company")
(Nasdaq: TWNE) between June 25, 1999, and October 13, 1999, inclusive
(the "Class Period").

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, at Milberg Weiss Bershad Hynes & Lerach ("Milberg Weiss"),
Steven G. Schulman or Samuel H. Rudman at One Pennsylvania Plaza, 49th
Floor, New York, New York 10119-0165, by telephone 1-800-320-5081 or via
e-mail: endfraud@mwbhlny.com or visit our website at www.milberg.com.

The complaint charges Towne and certain of its officers and directors
with violations of Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges
that defendants issued a series of materially false and misleading
statements concerning the Company's operations and failed to disclose
adverse sales trends and slowdowns in the demand for its products. As a
result of these false and misleading statements the price of Towne
common stock was artificially inflated during the Class period.

If you are a member of the class described above you may, not later than
sixty days from October 15, 1999, move the Court to serve as lead
plaintiff of the class, if you so choose. In order to serve as lead
plaintiff, however, you must meet certain legal requirements. Contact:
Milberg Weiss Bershad Hynes & Lerach Shareholder Relations Dept. E-Mail:
endfraud@mwbhlny.com 1-800-320-5081


TRISTAR CORP: Settles Securities Suit Re Pre-1992 Ownership of Sheth Gp
-----------------------------------------------------------------------
In December 1993, the Company reached an agreement to settle stockholder
class action litigation regarding alleged violations of the federal
securities laws, as well as common law fraud and negligence in
connection with, among other things, the nondisclosure of the ownership
interest of the Sheth Group prior to 1992, for a cash payment of $9.5
million. The settlement resulted in a release of claims by the plaintiff
class against the Company and certain other defendants.


TURNER: Advocates Say Hearings For Welfare Benefits in NY are Unfair
--------------------------------------------------------------------
Legal aid lawyers and welfare advocates are concerned that a New York
City pilot program designed to expedite the resolution of disputes over
public assistance benefits infringes on the due process rights of their
indigent clients.

The program, called Mandatory Dispute Resolution (MDR), began in May in
Staten Island and expanded to Queens in August. It requires that public
assistance recipients who have requested fair hearings to contest
reductions in their benefits appear at pre-hearing arbitration
interviews at local welfare centers under threat of having their cases
closed.

While MDR has so far affected only appellants in two boroughs, a class
action suit has already been filed in federal court on behalf of those
summoned for interviews. And welfare advocates are concerned that the
City erroneously has been sending MDR notices to public assistance
recipients in areas where the program is not yet in place.

New York City maintains that the new program helps to cut down the
number of fair hearings by resolving disputes early, a benefit to both
the Human Resources Administration (HRA), whose employees represent the
City at the administrative hearings, and appellants seeking speedy
resolution of conflicts over their benefits.

Supporters also claim that MDR is a good way to prevent fraudulent
claims from getting to the hearing stage. Welfare recipients who file
phony challenges to a reduction in their public assistance grants will
now be screened in advance of their fair hearings. If they skip the MDR
interviews, the HRA can close their cases.

But welfare advocates maintain MDR is an attempt to make it difficult
for poor people with legitimate claims to receive public assistance.

"Legal Aid is all for resolving disputes at local centers," said Chris
Lamb, Attorney-in-Charge of Legal Aid's Staten Island Neighborhood
Office. "But real dispute resolution," he said, "requires that both
sides put all cards out on the table at the same time" - a requirement
he said he thinks is lacking at MDR interviews.

MDR rules require that fair hearing appellants disclose all evidence at
their interviews that they intend to present at their hearings. However,
the City has made no assurances that it is being held to a reciprocal
obligation. According to New York State Rules and Regulations, fair
hearing appellants are entitled to examine all documents the City will
present into evidence at their hearing, but they must request them from
their local agencies.

Mr. Lamb said appellants will be discouraged from putting forth evidence
at their hearings that they did not have at the time of their
interviews. He claims that the threat of preclusion, coupled with that
of case closure for failure to attend MDR interviews without good cause,
has a chilling effect on the fair hearing process.

The debate over MDR began when Mr. Lamb learned that one of his clients
had signed a waiver of her right to a fair hearing at a May 28 MDR
conference at Richmond Center 99. Mr. Lamb promptly wrote a letter to
the HRA protesting his lack of knowledge about the interview and the
interviewer's under budgeting of the woman's food stamps. According to
Mr. Lamb, the woman had been unsuccessful in her efforts to rebudget her
benefits with her caseworker, but there was no threat of case closure
until she requested a fair hearing.

Mr. Lamb claimed that the MDR program effectively penalized his client -
by depriving her of her right to counsel and obtaining an uninformed
withdrawal of a fair hearing request - for exercising her right to due
process. If the City did not address this concern, the letter said,
litigation would follow.

                            Class Action Filed

Yet attorney Peter Vollmer, of the Law Offices of Vollmer & Tanck in
Uniondale, beat Mr. Lamb to it. He filed a class action suit, Khana v.
Turner, 99-CV-5629, in the Eastern District on Sept. 14. The plaintiff,
Manour Khana, is enrolled in a state chemical dependency treatment
program in Suffolk County, and receives public assistance and Medicaid
benefits from the City as a temporarily absent resident.

When the HRA proposed to reduce his benefits by 15 percent in order to
recover an alleged overpayment caused by the HRA's own error, Mr. Khana
requested a fair hearing and was summoned for MDR. High transportation
costs and a strict daily treatment schedule made getting to his MDR
interview in Queens difficult. As a result, Mr. Khana was considering
withdrawing his request for a fair hearing and accepting the City's
proposed reduction in his public assistance, rather than risking the
complete loss of his benefits for failure to comply with MDR.

Mr. Vollmer argued that the City's policy illegally forces Mr. Khana and
others like him to choose between his fair hearing rights and his
benefits. Ruth Reinecke, director of Special Projects for Public
Information at HRA, said the agency would not comment on the litigation.
(New York Law Journal Nov-10-1999)


USA DETERGENTS: Discloses SEC Request for Documents and Testimony
-----------------------------------------------------------------
USA Detergents Inc. discloses the following in its filing with the SEC
for the quarter ended September 30, 1999 filed as of November 24, 1999:

In connection with the quarterly and annual results of operations
originally reported by the Company for certain fiscal quarters in 1996
and 1997 and the fiscal year ended December 31, 1996, the Company has
received a formal request from the SEC for the production of various
documents and the testimony of certain current and former employees. The
Company has been providing documentation and other materials to the SEC
in response to the request, and the testimony of certain persons has
been taken. The Company will continue to cooperate with the SEC.

In the second quarter of 1998, the Company settled for $10.0 million a
stockholder class action lawsuit. The Company recorded a charge during
that quarter of approximately $3.3 million which included legal fees,
after insurance and other participations.


* Crowe and Others Say Securities Fraud Is Rampant In Silicon Valley
--------------------------------------------------------------------
Federal prosecutors say white-collar crime is a priority, but they have
filed only a few charges against Silicon Valley executives. Silicon
Valley is the epicenter of the fastest creation of wealth in history.
But the high-tech miracle has a dark side: untold stories of ruined
investors, betrayed entrepreneurs and regulators who are overmatched and
overwhelmed. Robert Crowe was afraid he wouldn't be ready.

For months, the assistant U.S. attorney had been preparing a securities
fraud case against executives at California Micro Devices, a Milpitas
chip manufacturer. But as the 1998 trial neared, Crowe was inundated
with 600,000 pages of documents and didn't even have a clerk to work the
copy machine.

Meanwhile, the FBI and the Securities and Exchange Commission continued
to bring him promising cases against other Silicon Valley companies. But
Crowe was the only federal prosecutor in San Francisco working full time
on investment fraud, and there was nothing he could do with them. "The
inventory of cases kept building," said Crowe. "I couldn't keep up."

Cal Micro was the first major Silicon Valley fraud case tried by the
U.S. attorney's office in San Francisco. It was also the last -- even
though shareholders have sued more than 60 high-tech companies in
Northern California's federal courts since 1995.

Silicon Valley executives contend that most of the complaints are
frivolous, but Crowe and others say the rising number of class-action
suits shows that fraud is rampant in the high-tech industry. "If they
put together a special federal task force and sent it into the valley,
they could bring a ton of fraud cases," said one senior prosecutor at
the U.S. Department of Justice.

But the U.S. attorney's office has done little to deter securities fraud
in Silicon Valley, filing criminal charges against only a handful of
high-tech executives the entire decade.

Since shaking the recession of the early 1990s, Silicon Valley has
become the epicenter of the fastest creation of wealth the world has
ever seen. And the opportunities and motives for financial deceit have
never been greater. Silicon Valley executives face intense pressure to
meet Wall Street's expectations. Missing quarterly projections can mean
financial disaster for a company -- and for the executives whose
compensation packages depend on the company's stock price.

For many corporate officers, the temptation to "cook the books" -- and
then unload shares before the company's stock price collapses -- is
overwhelming. And unless federal prosecutors crack down, experts warn,
securities fraud will continue to flourish. "More executives should be
going to jail," said Stanford University law Professor Joseph Grundfest,
a former SEC commissioner and national expert in securities fraud. "That
will grab their attention . . . and hand a valuable lesson to the entire
economy."

This is the story of how federal prosecutors have allowed securities
fraud to spread through Silicon Valley like a virus. It is an account of
the one major case that the U.S. attorney's office in San Francisco
prosecuted, desperately hoping the trial would serve as a warning to the
high-tech industry. And it is about an even bigger case, one of the most
flagrant in Silicon Valley history, that federal prosecutors let sit on
the shelf.

                          Yamaguchi's Vow, 1993

When Michael Yamaguchi was appointed U.S. attorney for the Northern
District of California in 1993, he took over an office that had been
adrift for years under a string of temporary chiefs. As one of his first
priorities, Yamaguchi pledged an aggressive campaign against
white-collar crime. But the soft-spoken tax specialist quickly learned
it wasn't going to be easy.

"We did not have nearly enough resources," said Richard Seeborg, a
former prosecutor in the agency's San Jose office. "When you compare our
office to U.S. attorney's offices around the country, we were grossly
understaffed." In the 1990s, the Northern California district office
had, on average, only one-quarter of the federal prosecutors per capita
that were assigned to lower Manhattan and one-third the number of
prosecutors posted to Southern California.

Yamaguchi's first test came in June 1994, when former Chronicle
columnist Herb Greenberg reported allegations from former employees at
California Micro Devices that the company had been booking fake or
premature revenue for years. Shortly after the disclosures, as the FBI
and SEC investigated, the company's senior financial officer, Steven
Henke, resigned. A few weeks later, the board of directors fired Chief
Executive Officer Chan Desaigoudar, and Cal Micro's stock plummeted an
estimated $139 million.

As Yamaguchi's prosecutors conducted interviews and pored over Cal
Micro's records, they found that the company had booked millions of
dollars in revenue for products that had not been shipped. They also
discovered double bookkeeping, false financial filings and illegal
write-offs. At the same time, the prosecutors discovered, Desaigoudar
and Henke had dumped more than $1.1 million of their own stock before
its price collapsed. It was the perfect case for Yamaguchi to
demonstrate that his office was serious about white-collar crime.

                          The Mastermind, 1989

Phil White was always ambitious -- even before he was accused of
masterminding one of the largest securities fraud scandals in Silicon
Valley. The sandy-haired White grew up in small-town Illinois, the son
of an accountant and a public school teacher. He majored in business at
Illinois Wesleyan University and later graduated from the University of
Illinois' business school. He first worked for a travel company, leading
tours through Latin America, Europe and Canada and running the company's
Hawaii office. But when he realized he had no chance to head the
family-owned business, he quit. "I didn't go to school," he once told a
financial trade magazine, "to be second or third fiddle." Next, he moved
to IBM's St. Louis office, where he consistently won sales awards. But
he knew he would never challenge for the top job at IBM, either, and
after 15 years, nearing middle age, he decided to change course. In
1982, White moved to a sales and marketing job in Silicon Valley and two
years later joined the board of Wyse Technology. In 1986, when the
company needed an aggressive new president and chief operating officer,
White seized the chance.

Wyse had been a prosperous manufacturer of video display terminals for
many years, but its market niche was doomed by a new generation of
desktop computers that could operate without mainframes. Shortly after
White took over, Wyse moved into the personal computer market, and
White's management team promised 20 percent revenue increases every
three months. It was an ambitious goal, and almost immediately it led to
disaster.

In the haste to meet the target, Wyse made a lot of shoddy computers.
They overheated, erased information and ejected circuit boards during
shipping. The pressure to meet revenue goals grew so intense that in
December 1987 the company shipped computers in garbage bags after the
anti-static containers ran out. According to court documents, the
company claimed sales on computers that were actually sent "around the
corner" to shippers' warehouses, then returned to Wyse after the end of
the financial quarter. Some computers were not shipped at all, merely
entered into records as ordered and "processed." On Feb. 16, 1988, the
company reported quarterly revenue of $128 million -- an astonishing 75
percent increase over the quarter one year earlier. At an industry
conference in September, White proclaimed that 1988 "looks to be a
banner year for all of us."

But on Jan. 5, 1989, the company abruptly announced that revenues for
the previous quarter were down by half from a year earlier. The stock
price plunged to $5 a share, far below its high of $25.50. Almost 600
employees -- 15 percent of the company's workforce -- would soon be
fired. Before the year was over, a Taiwanese company would buy Wyse for
$10 a share. Investors, mutual funds and pension funds lost tens of
millions of dollars. Bill Lerach and other plaintiffs' attorneys sued
White and other company officials for securities fraud and insider
trading.

The suit was settled in 1992 for $15.5 million in cash -- with no
admission of wrongdoing. It was not the last time White would be accused
of "cooking the books."

                         The Prosecutor, 1990

Robert Crowe charged out of Cornell University law school in 1983, eager
to become a criminal defense lawyer. But he quickly found positions as a
public defender more difficult to find than prosecutor jobs, so he wound
up as an assistant district attorney in Brooklyn, N.Y., and loved it.
After several years of prosecuting street crimes, the Chicago native
began looking for something more challenging. He found it in 1989 when
he went to work in the U.S. attorney's branch office in San Jose.

In 1990 he got his first securities fraud case. It involved a company in
Campbell called StarSignal Inc. At the time, the U.S attorney's office
didn't pay much attention to investment-fraud cases. According to
several former prosecutors, the lawyer responsible for them just sat on
the complaints in the San Francisco office. It got so bad, they said,
that frustrated SEC officials stopped sending cases over. "The head of
SEC enforcement was thrilled when I began working on StarSignal," Crowe
said.

StarSignal was the brainchild of an excitable and brilliant engineer
named Robert Widergren. With several million dollars raised from private
investors, the company developed the world's first commercial color fax
machine. But the early machines were expensive, costing as much as
$26,000, and sales never took off.

In 1990, a former executive tipped the SEC that the company was raising
money by sending investors false information -- including news of an
imminent sale in Spain worth $83 million. The figure, said the tipster,
was "extracted from the air." That August, the FBI moved in, arresting
Widergren after learning that he planned to transfer money to Belize in
Central America. Widergren was charged with bilking investors of more
than $3 million.

The StarSignal case gave Crowe his first inkling that securities fraud
was more widespread in Silicon Valley than anyone suspected. "Why are
you doing this to me?" Crowe remembers Widergren asking during breaks in
the 1991 StarSignal trial. "My case is just a few million dollars.
There's fraud going on all over the valley worth hundreds of millions."

                      Informix's Turnaround, 1993

For nearly a decade, Informix flourished as one of Silicon Valley's
leading makers of software for managing computer databases. But in 1989
the Menlo Park company bought a software firm in Kansas City, and the
acquisition started to drag revenues down. So Informix founder Roger
Sippl turned to White, unfazed by Wyse's collapse and the allegations of
securities fraud.

White quickly swung into action, firing a fifth of the company's
workforce. He expanded the company's business to Europe and Asia. He
directed Informix's engineers to change the database software so it
would work in networks of personal computers rather than just
mainframes. When PC networks became the rage, Informix cleaned up.
Within four years, the company rebounded from a $46.3 million annual
loss to post a $56 million profit. Its stock rose from 56 cents a share
to more than $ 30. The numbers dazzled Wall Street, and White looked
like a genius. But then the industry began to slow. And the next year,
company executives found new ways to keep revenues growing.

                        The First Warning, 1994

Something was wrong with the numbers. In May 1994, internal auditors at
Informix were examining the Australian accounts, and the figures didn't
add up. The company's Australian subsidiary had booked sales a full
quarter before the software products were even shipped.

A few months later, the company's outside auditors -- Ernst & Young --
warned company officers of similar problems in Europe. The auditors also
chided Informix for selling software in Latin America on "handshake"
agreements. "Shareholders will expect agreements with customers to be
documented," the auditors wrote in a draft memo for the 1994 year-end
audit.

Informix executives dismissed the incidents as aberrations. But at an
annual meeting in January 1995, Chief Financial Officer Howard Graham
met with sales representatives to backdate contracts so that January
deals appeared to have closed in December, according to a shareholders'
suit. The result was inflated revenues for 1994. The executives joked
among themselves that they were closing the quarter on "December 45th."

                        A Company On A Roll, 1996

In early 1996, White negotiated Informix's $400 million purchase of
Oakland-based Illustra Information Technologies. It seemed a stiff price
for a company with less than $10 million in annual sales and an unproven
technology that stored images and sound in electronic databases. But
White touted the acquisition and the wonders of Illustra's technology.
"This stuff is going to change the way people think," he said.

And Informix, it seemed, was on a roll. White declared that he expected
the firm "to become a billion-dollar company in 1996." But for nearly
two years, auditors had warned Informix's board of directors that White,
Graham and other executives were inflating revenues through a variety of
questionable accounting practices, including backdated sales, "burn
deals," barter transactions and side letters.

Under what Informix employees called "Howard's rule," Graham would allow
sales contracts to count toward revenue even before they were fully
signed. In barter transactions or "Phil deals" -- named for Phil White
-- Informix would agree to buy another company's products if that
company would license Informix's software. Informix would then count as
revenue the entire value of the software licenses -- without disclosing
that it still had to buy the other products before it could get paid. In
some cases, it never received payment because the software was returned.
And in complex "burn" transactions, Informix would agree to sell
software licenses to a distributor, then loan the distributor money for
the purchase price. Informix would book the transaction as revenue and
the distributor would, in theory, resell the software so that it could
repay -- or "burn" -- its loan commitment to Informix.

But in many cases, the distributor was under no obligation to resell the
software or to repay the loan. Sometimes Informix would never even
deliver the software. The sales, though, remained on the company's
books.

In other transactions, White would negotiate side letters that granted
customers undisclosed concessions such as price breaks or longer payment
terms. The letters changed the deal so that the original sales contracts
-- and the revenues recorded under them -- were no longer accurate.

As Ernst & Young was privately warning Informix directors about these
practices, though, it was publicly issuing letters giving the company a
clean bill of health. On April 15, 1996, Informix reported $204 million
in revenue for the first three months of the year -- a 38 percent jump
from the year before. Wall Street was impressed. The next day, Informix
stock rose $5 to $24.25 a share. Over the next three weeks it would top
$26. And White and Graham would begin to unload tens of thousands of
their shares in the company.

                           Dumping Stock, 1996

Auditors could barely conceal their frustration about the accounting
irregularities at Informix. "It just gets better all the time," wrote
one Ernst & Young auditor after discovering several improper deals.

In 1996, Informix booked tens of millions of dollars from transactions
that were backdated, incomplete, subject to secret conditions -- or
simply nonexistent, court documents show.

"Phil deals," or barter transactions, accounted for much of the
improperly recorded revenue. That year, Informix sold about $170 million
worth of software to companies from which it bought about $130 million
worth of computer equipment. Although Informix denied the transactions
were related, an audit would later determine that at least some were,
and that they had artificially boosted revenues by $55 million. Burn
deals and side letters contributed tens of millions of dollars more. By
mid-1996, Informix's European subsidiary had booked more than $105
million from burn deals for which the company remained unpaid. The
tactics served their immediate purpose: They increased revenues and kept
the share price high.

By December, before leaving to become chief financial officer at Siebel
Systems, a San Mateo software company, Graham had sold more than $2.8
million worth of his Informix stock. During the next two months, White
and other executives dumped more than $20 million in shares. Then,
suddenly, everything began to come apart.

                       Informix In Free Fall, 1997

Despite its inflated revenues and soaring stock price, Informix was
starved for cash. And as the company tried to collect on the burn deals
it had written, customers objected, and, in some cases, refused to
conduct further business with the company. British software firm Logical
Systems International, for example, had agreed to "buy" Informix
software with the understanding that Informix would resell it and not
make Logical Systems pay. "Informix asked us to do them a favor," wrote
managing director Stewart Ashton in a March 27, 1997, letter to the
company, a favor that would "artificially inflate the quarter numbers
(of Informix) for last June and September."

But when Informix squeezed Ashton for payment, he howled at having been
"coerced into this . . . arrangement." Finally, Informix could no longer
hide its crumbling finances. On May 14, in its quarterly filing with the
Securities and Exchange Commission, Informix announced that it had lost
$140.1 million in the first quarter of 1997, and that "almost half of
the licenses sold to resellers" since 1995 "have not been resold."

White blamed an "overemphasis" on selling the new Illustra-based
technology rather than traditional software, but financial analysts knew
better. "An unmitigated disaster," one analyst called the company's
announcement.

                       Yamaguchi's Retreat, 1997

Robert Crowe watched from his desk in San Francisco as much of the U.S.
attorney's office sank slowly into disarray. He had transferred from the
San Jose office after Widergren's conviction in the StarSignal case. He
had taken charge of screening most investment-fraud prosecutions and
coordinating investigations with the SEC. But Yamaguchi's vow to crack
down on white-collar crime in Silicon Valley quickly turned hollow.

In December 1996, Sen. Diane Feinstein recommended Yamaguchi to fill a
vacancy on the U.S. District Court in San Jose. The judgeship should
have been a crowning achievement for the 46-year-old prosecutor, whose
father, grandparents and thousands of other Japanese Americans were kept
in World War II internment camps after a series of rulings by federal
judges.

But five months later, Yamaguchi withdrew his name after his public
comment about an important drug prosecution led to a mistrial in the
case. "After that, and all the bad press around the case, Mike just
disengaged and hid out in his office," said one former assistant U.S.
attorney. Even Yamaguchi acknowledged later that he had "crawled into a
shell."

Veteran prosecutors were leaving the office in droves. Case filings and
conviction rates were plunging. And criminal referrals from the SEC and
FBI -- some involving serious allegations of fraud in the high-tech
industry -- were going unprosecuted. Even the Cal Micro case, the
office's best hope for sending Silicon Valley executives a message,
seemed in jeopardy.

                        A Day Of Reckoning, 1997

Informix was at the threshold of disaster. On July 30, 1997, directors
and top company executives gathered to hear the devastating news in the
Palo Alto offices of Wilson Sonsini Goodrich & Rosati, the most powerful
law firm in Silicon Valley. The board had already stripped White of his
title as chief executive officer and hired a replacement, former 3Com
executive Robert Finnochio, to review Informix's financial records.
After asking White to excuse himself from the meeting, the directors
listened raptly as Finnochio described the widespread accounting
irregularities that White and other company executives had allegedly
engaged in or condoned. Finnochio's grim report meant that White was
finished. When Finnochio completed his presentation, the directors
severed all ties with White and replaced him as chairman with Finnochio.

It took Ernst & Young three months to determine the full extent of the
questionable accounting schemes. On November 18, Finnochio made what he
described as "the mother of all financial announcements." Informix would
have to restate financial results for the previous three years. The
company disclosed that it had improperly claimed a staggering $278
million in revenues and $236 million in profits.

On the brink of insolvency, Informix laid off thousands of employees.
Offices were closed and operations consolidated. The company abandoned
plans to build showrooms around the world and announced that it would
sell a 27-acre parcel of land in Santa Clara, the planned site for new
headquarters.

Immediately, Lerach and other plaintiffs' attorneys filed class-action
suits on behalf of the thousands of investors who had lost millions of
dollars, and Informix braced for the onslaught.

                          The Eve Of Trial, 1998

It was well past midnight in the warren of cramped offices on the 11th
floor of the Phillip Burton Federal Building, and Crowe was still
working. He had been at it for days, his frustration mounting. More than
three years had passed since the investigation into Cal Micro had
opened. In the middle of trial preparations, Leo Cunningham, then
Richard Seeborg, the two prosecutors who had worked the case from the
beginning, left the U.S. attorney's office to join big law firms in
Silicon Valley.

Crowe had replaced them, and now, in early 1998, he was handling the
case alone. He looked over the 600,000 pages of documents with a mixture
of disbelief and terror. "I got started so late," he said. "There was no
secretary, no paralegal, no resources I could count on from the office
-- nothing. "At one point I had to decide between spending 80 hours with
(a key witness) or going through every document. I chose the witness,
but I was afraid the defense would find something in those papers, and I
would be blindsided during the trial."

Finally, the Department of Justice dispatched Pamela Merchant, a senior
fraud specialist in Boston, to help him try the case. Meanwhile, fraud
cases from the SEC and the FBI continued to pile up on his desk. But
there was little Crowe could do. He tried to farm them out to other
prosecutors, but he couldn't force anyone to take them. And he was
acutely aware of how Silicon Valley would view the inaction. "These big
white-collar cases . . . should have high impact," he said. "But if you
screw around for four or five years, no one takes you seriously."

                         An Empty Victory, 1998

The Cal Micro case finally went to trial in June. Crowe and Merchant
believed they had a strong case, a tour de force constructed around a
stack of financial records and the testimony of two former Cal Micro
executives who agreed to testify for the prosecution.

In their defense, former CEO Desaigoudar and treasurer Henke told the
jury that they had done nothing wrong, that they never saw memos or
attended meetings where the fraud was discussed. And they repeatedly
blamed the wrongdoing on their subordinates.

Their testimony proved unpersuasive. On July 14, 1998, after a five-week
trial, jurors found each man guilty of five felony charges, including
conspiracy, securities fraud, insider trading and making false SEC
filings.

It was a major victory for the demoralized U.S. attorney's office. But
for Crowe it was the end of the road.

Just before the trial, his supervisor entered his office and complained
that Crowe hadn't done anything with the mounting inventory of criminal
fraud referrals. "I exploded," Crowe said. "I had given him the cases to
reassign months earlier so I could concentrate on the trial, and he had
done nothing."

Crowe was sick with frustration. He had relished prosecuting Widergren,
Desaigoudar, Henke and other white-collar criminals. He had even won an
award for his representation of financial fraud victims. In August, he
cleared out his desk in the federal building. When he submitted his
resignation, he had no idea who would take over the inventory of cases
the office still hadn't dealt with, including one potentially explosive
case referred to him months before.

                            The Verdict, 1998

On December 8, a vast Pacific Gas and Electric Co. power failure left
only dim, backup lighting in the San Francisco courtroom of U.S.
District Judge Vaughn Walker. Despite the jury's verdict against Chan
Desaigoudar and Steven Henke, the former Cal Micro executives refused to
acknowledge their crimes, insisting that their subordinates had betrayed
them. "If I have a regret about my conduct as a former CEO and
chairman," a defiant Desaigoudar told the judge, "it is simply this: I
might have trusted my employees. For this, I and my family will suffer
and have been suffering."

Walker tentatively ruled that he would impose prison terms of 36 months
for Desaigoudar and 32 months for Henke, far less than the government
had requested. Merchant was furious. "Your honor, the government is
deeply troubled," she said. She reminded Walker that the fraud had cost
investors tens of millions of dollars. "This is a significant, as the
court has said, grave matter." She urged Walker to reconsider and to
send a strong message "to the public and the investing community that
this type of crime would not be treated differently than any other
crime."

Walker was unswayed. He praised the accomplishments of the two
defendants. He extolled their civic and charitable contributions. He
even called their situations tragic. "This cannot by any stretch of the
imagination," he said, "be rendered equivalent to fraud which takes
advantage of helpless and uninformed or particularly gullible
individuals."

                               Epilogue

In August 1998, Yamaguchi resigned as U.S. attorney amid growing
criticism from judges and attorneys about his ineffectiveness. Several
months later he became an immigration law judge in San Francisco.
Yamaguchi was immediately replaced by Robert Mueller, a tough, career
prosecutor from Washington, D.C., who immediately promised to step up
prosecutions of white-collar crime, focusing on Silicon Valley.

A month later, after a four-year investigation, two former executives of
Media Vision, a Fremont chip developer, were indicted on charges of
securities fraud and insider trading. The case has yet to come to trial.
Mueller said the agency has "a number of cases in the hopper," but he
declined to comment further.

In July of this year, the shareholders' class-action suits against
Informix were settled. Without admitting any wrongdoing, the company and
Ernst & Young agreed to pay investors a total of $142 million, the
largest securities fraud settlement in Silicon Valley history.

White, who was not held personally liable for any of the settlement,
currently lives in Atherton and sits on the boards of several companies,
as well as his college alma mater. He denies any wrongdoing and has
declined to comment further. Howard Graham, who also paid nothing under
the settlement, refused to comment. o criminal charges have been filed
against White, Graham or any other Informix executives by the U.S.
attorney's office.

Desaigoudar and Henke have appealed their convictions, and they remain
free on bail. Crowe practices law in San Francisco, representing
investors.

                               Informix

Roger Sippl founded Informix in 1980 after Hodgkin's disease forced him
to put his medical education on hold. The company quickly grew into one
of Silicon Valley's hottest companies, and after Phil White took over in
1989 it seemed poised to surpass Oracle, Sybase and other competitors as
the top maker of data-base management software.

A troubled fling with a multimedia-database product and charges of
accounting fraud and illegal insider trading derailed the company in
1997. The company has attempted to recover ever since, and last year
posted net income of $57.7 million after a $357 million loss the year
before.

                       California Micro Devices

Based in Milpitas, California Micro Devices makes silicon chips, filters
and electronic circuitry for workstations and personal computers. Since
its former top officers were accused of securities fraud in 1994 and
then convicted last year, the company has attempted to recover by
expanding into new markets. For the fiscal year ended in March, Cal
Micro lost $2.8 million on sales of $33.6 million. It has 150 employees
in Milpitas and 110 in Tempe, Ariz. (The San Francisco Chronicle
Nov-16-1999)


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