Shareholder Class Action
Areas of Focus | 2008/05/23 16:04

Shareholders sued Calpine Corp. and its directors, claiming they are selling Calpine too cheaply to NRG Energy, for $23 a share, or $9.6 billion, a 6.7% premium over market price, in Harris County Court, Houston.
    
Shareholders claim directors of Wendy's International withheld information and engaged in self-dealing, in a class action in Franklin County Court, Columbus, Ohio.
    
TRM Corp. and its directors inflated share price through false and misleading statements, shareholders claim in Portland, Ore., Federal Court.
    
Shareholders claim American International Group inflated the value of its securities through false and misleading statements from May 11, 2007 through May 9, 2008, in Manhattan Federal Court.



Court Says Cop's Criticism Isn't Protected Speech
Areas of Focus | 2008/05/22 15:55
An Illinois State Police officer was not wrongfully transferred for accusing his superiors of sabotaging his investigation of a cold-case murder, the 7th Circuit ruled.

Plaintiff Michale Callahan filed a First Amendment retaliation claim against his superiors, Steven Fermon and Diane Carper.
   
Judge Ripple ruled that the U.S. Supreme Court's decision in Garcetti v. Ceballos determined that the First Amendment did not protect the free speech of a public employee acting in his official capacity.

Callahan's investigation indicated that the two men serving life sentences for the murders could not have committed the crime. Callahan then came to believe that the real killer was a man who had made significant contributions to the campaigns of the attorney general and the governor.

Callahan alleged that when he told Fermon and Carper about the results of his investigation, he was asked to pursue lesser charges against the contributor and to stop investigating the murder because of the case's political sensitivity.

After tension became too high in the police department, Callahan was transferred to another precinct.

The trial court had ruled in favor of Callahan, and the Garcetti decision came down during the defendants' appeal.


Woman Profited From Disabled Children
Legal Topics | 2008/05/21 17:23
A Florida woman pleaded guilty Tuesday to bilking New York state and city of $1.7 million intended to support 11 adopted, disabled children. But Judith Leekin kept many of them restrained in her basement, did not let them go to school, and spent the money on herself.

Leekin, 63, of Port St. Lucie, used four aliases to adopt the children from 1988 to 1996, lied about how many kids were living with her and lied about their disabilities, according to the criminal information to which she pleaded. She got $1.68 million in adoption subsidies from 1988 through July 2007, "and used the money to support a lavish lifestyle for herself," the U.S. Attorney's Office said.

She also had custody of a 12th disabled child. In 1997, when she lived in Queens, N.Y., 11 of the kids lived in the basement of her home "and did not go to school or outside," prosecutors said. "In addition, several of the adopted children 1-11 were restrained in order to prevent them from getting out of their beds."

In 1998, she moved to Florida, where she treated the children in the same way.

"Between 2004 and July 2007, in Florida, adopted children 1-1o slept on the floor of a storage room abutting the garage and typically only entered the house to use the bathroom or the kitchen," prosecutors said. "In addition, adopted children 1-10 did not attend school, and several of the adopted children were restrained using plastic ties."

She kept collecting money for child 11 after booting it from her home.Leekin pleaded guilty to wire fraud and mail fraud. She faces up to 20 years in prison and a fine of twice the gross gains from her offenses. She will be sentenced on July 23.


Ex-Lottery Commissioner Loses Conviction Appeal
Areas of Focus | 2008/05/20 17:29
The 4th Circuit upheld the conviction and sentencing of ex-North Carolina lottery commissioner Kevin Geddings, who concealed the fact that he had a conflict of interest with a lottery vendor.

A federal jury convicted Geddings of five counts of mail fraud for concealing his business relationship with Scientific Games, a vendor vying to operate the North Carolina state lottery.

After being appointed lottery commissioner, Geddings emailed his secretary and told her never to acknowledge over the phone that Scientific Games "is a client." As a lottery commissioner, he was supposed to provide an unbiased vote in determining which vendors run the state lottery.

Although Geddings had recused himself from voting on lottery vendors, he continued to receive money from Scientific Games and circulated negative articles about competing bidder, GTech.

Geddings' run as commissioner ended after the U.S. district attorney's office in North Carolina launched an investigation of the state lottery, forcing Scientific Games to disclose its payment records. Geddings resigned on Nov. 1, 2001.

The appeals court unanimously upheld his conviction and 48-month jail sentence for using mail and wire services to "defraud the citizens of North Carolina of his honest services." It held that jurors and the trial court judge acted reasonably in holding him accountable.


Court Sides With MySpace In Suit Over Sex Assault
Legal Topics | 2008/05/19 17:20
MySpace is immune from a lawsuit accusing it of failing to protect a teen girl from the alleged sexual assault of a 19-year-old man she met on the popular social-networking site, the 5th Circuit ruled.

A three-judge panel upheld a Texas judge's dismissal of a lawsuit accusing MySpace.com and parent company News Corp. of failing to protect minor users from sexual predators.

The plaintiff, identified as Julie Doe, created a MySpace profile when she was only 13, but said she was 18 to circumvent the site's minimum age requirement of 14. After she turned 14, she met Pete Solis, a 19-year-old fellow MySpace user who allegedly sexually assaulted her in a parking lot in 2006.

A federal judge threw out a lawsuit filed by the teen and her mother, ruling that their claims are barred by Texas common law and the Communications Decency Act, which shields Internet service providers from getting sued for publishing material posted by third parties.

Doe and her mother appealed dismissal of their negligence claim, arguing that MySpace is not a "publisher" under their claims, and that MySpace is not entitled to immunity for its failure to take reasonable steps to protect minors.

Judge Clement, writing for the appellate panel, remained unconvinced.

"Their allegations are merely another way of claiming that MySpace was liable for publishing the communications and they speak to MySpace's role as a publisher of online third-party-generated content."

Solis was indicted on a sexual assault charge and faces up to 20 years in prison.


Skycaps File National Class Action
Areas of Focus | 2008/05/16 16:19
Employers are cheating airport skycaps nationwide by paying them less than minimum wage and discouraging tipping by charging a $2 per bag "baggage fee," which customers falsely believe will be given to the skycaps, the skycaps say in a federal class action.

The skycaps say the baggage fee, imposed in 2005, has seriously impaired their earnings, which were heavily dependent on tips, and that they often end up working for less than minimum wage.

The skycaps say this unfair system has been imposed at major airline counters, including United, US Airways, JetBlue and American, at airports around the country, including O'Hare in Chicago, Logan in Boston, Philadelphia International, Louis Armstrong International in New Orleans, and Fort Lauderdale Hollywood International in Florida.

They demand restitution and damages. Their lead counsel is Pyle, Rome, Lichten of Boston.

Here are the defendants: Huntleigh Corp., Prime Flight Aviation Services, Flight Services & Systems, American Sales Management Organization, and Prospect Airport Services.


Avandia Securities Class Action Dismissed
Areas of Focus | 2008/05/15 15:55
A federal judge dismissed a shareholders' class-action complaint that accused GlaxoSmithKline of violating securities laws by withholding or manipulating information about its heart drug Avandia. U.S. District Judge Louis Stanton dismissed for failure to state a claim, without leave to replead.

After discussing the studies and meta-analyses (studies of studies) of the drug, Judge Stanton bought Glaxo's arguments: "Defendants argue that the Court should dismiss the amended complaint because plaintiffs have not established that defendants have made a material misrepresentation or omission, plaintiffs do not sufficiently plead scienter, and the statements plaintiffs identify as false and misleading are forward-looking statements and thus are not actionable."


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