Corporate Law

Drug Trust Targeted By Thousands
of Bogus Claims, Lawyers Say

PHILADELPHIA -- A $3.75 billion settlement fund created for people who took the banned diet drug combination fen-phen is receiving thousands of fraudulent heart-damage claims, lawyers argued in a federal court filing. The Philadelphia-based AHP Settlement Trust has received 71,000 claims, more than eight times the number expected when the fund was formed in 1999. The trust has so far paid about 2,700 claims at an average of $400,000.

Judge Turns Down Class-Action Against Wal-Mart

PANAMA CITY, Fla. -- A judge has denied class-action status for a lawsuit that accuses Wal-Mart of failing to pay low-level employees for extra work. Circuit Judge Glenn Hess wrote in his ruling that if the plaintiffs were able to prove Wal-Mart shortchanged the employees, determining the amount owed to each worker would overwhelm the court system. Hess wrote that the court would face between 900 and 2,300 trials to determine damages if even 1 percent of the 90,000 to 230,000 Wal-Mart employees in Florida since 1997 joined the lawsuit.

State Bill Would Protect Against Obesity Lawsuits

COLUMBUS -- Food and beverage companies could be immune from lawsuits claiming they caused obesity or other health problems if two bills moving through the Statehouse become law. Critics call the proposals unneeded and too protective of negligent companies. But Sen. Larry Mumper, R-Marion, sponsor of one of the bills, called it a matter of avoiding frivolous lawsuits and promoting citizens' "personal responsibility" for their dietary habits.

New Study Undermines Justification
for Class Action Legislation

WASHINGTON -- A new study authored by legal experts Theodore Eisenberg and Geoffrey P. Miller debunks the central thrust of the Administration's class action legislation that lawyers are getting richer from big class action lawsuits. "This independent scholarly study strikes a blow against the business lobby's justification for class action reform legislation," said Nan Aron, president of Alliance for Justice. "Big business has spent millions of dollars telling members of Congress and the world that class action litigation and attorney fees have exploded, but this study shows that just isn't true," Aron added.

The business lobby and the Bush-Cheney Administration are aggressively pushing class action reform legislation. The Chamber of Commerce announced that passage of the legislation is its number one legislative priority this year. President Bush frequently mentions class action reform as a key part of his economic recovery plan for the sagging U.S. economy. More than 70 public interest organizations as well as state and federal judges, and state attorneys general oppose the legislation.

Bush Expected to Urge Senate to Pass Class Action Bill

WASHINGTON -- In his third State of the Union address tonight, President Bush is expected to call on the U.S. Senate to pass class action legislation that was already voted down last fall. However, the bill has been resurrected with minor changes due to anticipated vote switching by key Democrats.

AMHI Superintendent Quits

AUGUSTA -- The Augusta Mental Health Institute's superintendent has resigned, little more than a week after the court official appointed to take charge of the state psychiatric hospital said she planned to make major leadership changes. Lisa C. Kavanaugh, head of the troubled state hospital for the past three years, agreed to resign early this week, court receiver Elizabeth Jones said. Jones was appointed by Superior Court Chief Justice Nancy D. Mills in November to oversee AMHI after the judge ruled the state had failed to meet many requirements of the so-called AMHI consent decree. The decree was signed by state officials in 1990 to settle a class-action lawsuit brought by patients who decried conditions at the hospital. It requires improvements in community and hospital mental-health treatment.

NCI Settles Class-Action Lawsuits

NCI Building Systems Inc. has agreed to pay $7 million in a proposed deal to settle lawsuits filed against it in 2001 for restating financial statements. The Houston-based maker of metal products for the commercial building industry said the restatements were for the last half of fiscal 1999, all of fiscal 2000 and the first quarter of fiscal 2001.

Pay Days to Settle Federal Class-Action Lawsuit

COLUMBUS -- A Ricart auto dealership affiliate will pay up to $17 million to settle a federal class-action lawsuit accusing it of wrongfully charging customers for a theft-deterrent system and misleading them about finance charges. An estimated 36,000 Pay Days customers will be eligible to collect $500 payouts -- minus attorney fees -- from the recent settlement, according to court documents.

Class-Action Status Denied in Light-Cigarettes Lawsuit

Judge Allen Oleisky of the Fourth Judicial District Court in Minnesota denied class-action status to a lawsuit filed by a group of smokers against Philip Morris. The lawsuit claims that since 1971, Philip Morris, through its marketing efforts, deceived smokers into believing that Marlboro Lights were safer than regular cigarettes because they had less tar and nicotine.

Israeli Class Action Suit Sought Against Philip Morris

A petition for a class action suit was filed in the Tel Aviv District Court today against cigarette maker Altria Group (formerly Philip Morris) (NYSE:MO) and Philip Morris importer Menashe H. Elisar. The petitioners allege that the companies misled 200,000 buyers of light (low nicotine) cigarettes over the past seven years.

'Mammoth' Class-Action Tobacco Lawsuit Up to Judge

The makings of a "mammoth" class action against Canada's version of Big Tobacco landed in the hands of an Ontario judge today who must now decide whether to certify what could become the largest lawsuit in Canadian history.

Judge Thomas Decertifies Tri State
Crematory Class Action Lawsuit

Circuit Court Judge Neil Thomas has put down a ruling decertifying the class action he earlier set up for the Tri State Crematory lawsuits. Judge Thomas noted that the lead plaintiff in the case, Joe Oden, had joined in a class action that is before Federal Judge Harold Murphy at Rome, Ga.

Study Undermines Justification for Class Action Legislation

A new study authored by legal experts Theodore Eisenberg and Geoffrey P. Miller debunks the central thrust of the Administration's class action legislation that lawyers are getting richer from big class action lawsuits. "This independent scholarly study strikes a blow against the business lobby's justification for class action reform legislation," said Nan Aron, president of Alliance for Justice. "Big business has spent millions of dollars telling members of Congress and the world that class action litigation and attorney fees have exploded, but this study shows that just isn't true," Aron added.

Coalition Opposing Class Action Legislation Redoubles Effort

The 70-member coalition of consumer, environmental and civil rights organizations opposing the so-called Class Action Fairness Act (S. 1751) unveiled its new name, stepped up its efforts to defeat the bill expected to come up for a vote in two weeks in the U.S. Senate, and pointed to a scholarly study that decried the need for legislation altogether. The coalition's new name, Preserving Access to Justice, underscores the group's mission, membership, and focus.

Ruling Within A Week On Tri State Crematory Class Action

Circuit Court Judge Neil Thomas said he will rule within a week on the status of a class action in his court in the Tri State Crematory cases. Judge Thomas earlier set a class action involving five different funeral homes. Lawsuits were also filed in Federal Court at Rome, Ga., and Judge Harold Murphy set a class action there as well. The case involves the discovery of 339 uncremated bodies in mid-February 2001 at the Marsh family crematory at Noble, Ga., near LaFayette.

Class Action Against Investment Bank Allowed

A Federal Judge last week said he would allow a class action lawsuit against former analysts at Robertson Stephens over their recommendations for the technology stock Corvis Corporation. Southern District Judge Gerard E. Lynch said the suit, which alleges that the analysts recommended the stock to inflate its price and then sold off their own shares in the company, was distinguishable from a similar suit against Merrill Lynch that was dismissed last summer by Southern District Judge Milton Pollack.

Class-Action Lawsuit Proposed for Santa Rosa Diocese

Santa Rosa - A new class-action lawsuit has been proposed to resolve sexual abuse complaints against the Santa Rosa Catholic diocese. A lawyer for alleged sexual abuse victims has proposed consolidating 11 existing actions so they could be settled with one lump sum payment.

Motorists Fighting Legality of Red Light Cameras

SAN FRANCISCO -- Attorneys for 230 drivers who received tickets when cameras allegedly caught them zooming past red lights have asked a judge to throw out the citations because the traffic enforcement program, they say, is faulty. Lawyers are questioning the technical integrity of the cameras and legality of using only a photograph taken without any witnesses present when the machine clicks.

New Life for Legislation to Limit Class-Action Lawsuits

Congress is inching closer to passing a bill that would limit class-action lawsuits and large damage awards against corporations, something big business has sought for years. The Senate has been the stumbling block, but a deal struck just before lawmakers left for the holidays could garner enough Democratic support to approve the measure, which already has passed the House and is backed by President Bush.

Congress Considers Class Action Litigation Reform

WASHINGTON, D.C. — Legislation to reform class action litigation will once again be a hot topic in Congress in 2004. H.R. 1115, S. 274 and S. 1751 are bills that would move large, multi-state class-action lawsuits to federal court to prevent "venue shopping" by trial lawyers looking for more sympathetic state courts.

US Class Action Law Firm Files Against Parmalat

United States class action law firm Milberg Weiss Bershad Hynes & Lerach LLP plans to represent investors in a lawsuit it filed on Monday against Parmalat, the Italian food company embroiled in a multi-billion dollar accounting scandal. The lawsuit, which was filed in the US District Court for the Southern District of New York, is one of the first lawsuits brought by US investors who bought the company's shares and bonds.

UBS Bank Dismissed From WorldCom Class Action Lawsuits

UBS AG, an investment bank that participated in selling securities tied to the price of WorldCom Inc.’s stock, has been dismissed from the class action lawsuits filed over those securities after the giant telecom firm’s collapse. Judge Denise Cote, of the Southern District of New York, granted a motion made UBS’s lawyers to dismiss their client, ruling that the bank's statements about the WorldCom’s stock prices do not support any action under federal statutes.