The Boston Globe, "Lawsuit Targets 28 Drug Makers Alleging Price Manipulation"

          The Prescription Access Litigation project, a Boston-based consumer coalition, sued 28 pharmaceutical companies, claiming that the drug companies are engaging in industrywide manipulation of drug prices in violation of federal and state antitrust laws, consumer protection laws, and racketeering statutes.
          The PAL project, which has enlisted class-action attorneys who handled the ground-breaking lawsuits against tobacco companies, began bringing a series of class-action lawsuits against drug companies in April to challenge the prices of dozens of drugs.
          It's the first time consumer groups have banded together to sue pharmaceutical firms. But the issue the group raises in its latest lawsuit -- how drug companies charge the federal Medicare program and the elderly for their products -- is the subject of a wide range of criminal investigations, congressional hearings, and federal reports. To learn more about this litigation, click here.

The Associated Press, "Drug Makers Face Fraud Lawsuit"

          A coalition of 15 consumer groups filed a lawsuit alleging 28 pharmaceutical companies defrauded Medicare patients by inflating prices of drugs they sold to the government program. The suit, which was filed in the U.S. District Court in Boston, estimates that Medicare and individual consumers were overcharged by more than $800 million in 2000. It is the third suit filed on behalf of consumers making similar allegations in the past month.
          Drug companies post their average wholesale prices in lists used by the industry such as the Red Book and then give a discount to Medicare, a government program which provides health care to the elderly. The suit alleges the drug companies sold drugs to doctors at prices far less than the prices charged to Medicare. However, the government and Medicare patients paid the amount based on industry lists. Medicare only covers drugs dispensed in doctors offices and hospitals, and patients pay 20 percent of the cost.

The New York Times, "Firms Settle with Parents of Ill Children"

Washington Post, "Fed Acts to Curb Predatory Lending Practices"

          Prodded by consumer complaints about rip-offs in home-equity loans and refinancings, the Federal Reserve Board yesterday approved the strongest federal reserve ever to predatory lending. New rules, debated for more than a year, will increase the number of loans that are subject to scrutiny. Consumer groups and congressional allies said that they welcomed the changes but that the Fed should have acted years ago and could have done more to protect borrowers.
          The changes significantly widened the pool of high-cost home-secured loans covered by the Home Ownership and Equity Protection Act of 1994, a federal law that guarantees extra disclosures and consumer protections to borrowers. The law does not cover loans to purchase homes.
          Among the major changes the Fed made yesterday was lowering the threshold for what constitutes a high-cost first lien, reducing the interest rate trigger to 8 percentage points above comparable Treasury securities, down from 10 percentage points above such securities. That means that under the new rules, a 10-year loan would be considered high-cost at today's interest rates if the rate is above about 13 percent.
          The Fed also added new protections, such as barring "loan flipping" -- refinancing of high-cost loans by the same lender or loan servicer within a year.
          Lenders also will be presumed to have violated the law -- which says loans shouldn't be made to people unable to repay them -- unless they document that the borrower has the ability to pay.

Note: Lieff Cabraser has prosecuted several class actions against banks and financial companies for alleged predatory lending. If you have been subjected to a predatory lending practice, please contact us.

The Recorder, "Another Twist in Securities Case"

          The Ninth Circuit U.S. Court of Appeals has scheduled oral arguments in a case that could define the limits of a judge's discretion in determining which lawyers will run lucrative securities fraud class actions. Last week, the court ordered that In re Copper Mountain Networks Securities Litigation, 01-70772, be heard the week of Feb. 11. The appeal by Milberg Weiss Bershad Hynes & Lerach claims that plaintiff with the largest losses in a case must be permitted to manage the litigation.
          In deciding the case, the Ninth Circuit could dictate the standards for the "rebuttable presumption" outlined in 1995's Private Securities Litigation Reform Act. Under the legislation, intended to curb "lawyer-driven" litigation, plaintiffs who suffered the largest losses are presumed to be the party that should run the case for the rest of the class. But the presumption can be rebutted. Some federal judges invoke the loophole, citing pricey fee agreements as evidence that a particular client, and his firm, is not the best choice.
          When Copper Mountain Networks Inc.'s stock dropped, Milberg sued on behalf of several clients. Eventually the firm proposed a group of five investors to run the case. One, David Cavanaugh, lost nearly $1 million.
          But U.S. District Judge Vaughn Walker instead named a Beatie & Osborn client, Quinn Barton, to run the case. Osborn's loss is estimated at $59,000. While Milberg's agreement was a 20 percent to 30 percent sliding scale, Beatie & Osborn offered a 10 percent to 15 percent scale. Walker cited Barton's more favorable fee agreement, holding that selection of counsel was a leading indicator of a plaintiff's ability to lead a class action.
          Milberg then filed an appeal. Before the Ninth Circuit, CalPERS, the largest public pension in the nation, filed an amicus curiae brief supporting Judge Walker's decision. The brief (joined by Barclays Global Investors) is also notable for its authors - Stanford Law School securities fraud expert Joseph Grundfest and Lieff Cabraser Heimann & Bernstein. CalPERS and Barclays are members of the class. "They do not want to pay a higher price for representation that is not even argued to be superior," the brief reads.

The Wall Street Journal, "Bristol-Myers Faces Big Setbacks in Fight Against Generics"

          Bristol-Myers Squibb Co.'s efforts to protect its branded drugs from generic competition face big potential setbacks, from both the federal and state governments. In Washington, the company now appears likely to lose a high-stakes lobbying campaign to protect a lucrative diabetes medication from generic competition. At the same time, Bristol-Myers was sued by more than half of the country's state attorneys general Wednesday, who say the pharmaceuticals concern illegally shielded an antianxiety medicine from generic copies.
          Attorneys general from 29 states and Puerto Rico filed suit against Bristol-Myers in U.S. District Court for the Southern District of New York. They assert Bristol "unlawfully maintained its monopoly" on BuSpar, or buspirone, in late 2000 by falsely claiming to the Food and Drug Administration that it had obtained a new patent on a method of administering the antianxiety drug. Paul Novak, Michigan's assistant attorney general, said Bristol's efforts to extend the patent on BuSpar were "extremely aggressive."

The New York Times, "Overtime Becomes Class-Action Fodder"

          Chris Lyle was excited about her promotion from waitress to store manager at Pizza Hut in Northern California a few years ago, but soon wondered what her new title really meant. She said her duties were mostly making dough, mopping floors and taking orders, pretty much what an hourly worker would do -- except she was not paid overtime. "There were times my employees were making more money than me, when I looked at the hours I worked," said Mrs. Lyle, 30, who lives in Fairfield, Calif.
          Mrs. Lyle worked as a manager in several Pizza Hut stores from 1993 to 1998, including a full-service restaurant and take-out shops, starting at a salary of $18,000. "I thought it was a lot of money," she said. But the 50-hour week that managers were supposed to put in turned out to be more like 60, she said.
          Mrs. Lyle, who now works at a mattress company, was a plaintiff in a class-action lawsuit against Pizza Hut by salaried workers who said they were misclassified under federal and state labor laws as exempt from time-and-a-half overtime wages. The suit was settled in May for over $10 million.
          The debate about who is legally entitled to overtime pay has received more attention recently thanks to a flurry of class-action lawsuits seeking overtime pay at household names including Starbucks and U-Haul. One factor behind the trend was the team-building craze of recent years that blurred the lines between workers and managers, according to Jerry M. Newman, professor of organization and human resources at the University of Buffalo.
          "In a team, there's a lot more sharing of responsibilities and less care is paid to who's the manager and who isn't," Mr. Newman said. In addition, recent labor shortages in some industries forced more managers to take on rank-and-file tasks. With the economy now in recession, companies are further fueling worker discontent with layoffs and reduced paid overtime.

Note: Lieff Cabraser has successfully represented scores of employees of in lawsuits seeking unpaid overtime wages, including cases against Denny’s, Carrow’s and the advertising firm TMP Worldwide. For more information, click here.

Business Wire, "National Law Journal Names Nation's Top 50 Women Litigators"

          The National Law Journal (NLJ) reports on the dramatic progress women attorneys have made in the most elite area of law practice, litigation. The NLJ names the nation's top 50 women trial attorneys, a list that includes outgoing U.S. Attorney Mary Jo White, who rose to national prominence by overseeing the prosecution and subsequent convictions of the four men charged with bombing the World Trade Center.
          In addition to prosecutors like Ms. White, the newspaper profiles women who have argued and won some of the biggest recent corporate, class action and product liability suits. The list includes Elizabeth J. Cabraser, who has played a leading role in many of the largest class actions ever launched and/or settled, including the state and federal Exxon Valdez litigation, the $4 billion fen-phen diet drug products liability class settlement, the $1.2 billion win against State Farm Mutual Automobile Insurance Co. for the substitution of generic parts in car repairs, and the current class action against Firestone.

The Seattle Post Intelligencer, "Antitrust Deal; Help for Schools"

          Microsoft Corp. has agreed to settle a spate of antitrust suits by offering the nation's poorest schools more than $1 billion in cash, computers and software over five years. Some educators and attorneys praised the proposed settlement, which was signed Monday and is subject to approval by a federal judge. Other attorneys and analysts condemned it as inadequate and self­serving.
          Under the proposal, about 12,500 schools nationwide would get copies of Microsoft software, as well as refurbished computers and money for training and technical support. An estimated 7 million students, all at schools receiving federal assistance, would be eligible for the program, as would more than 400,000 teachers.
          "It is a settlement that avoids long and costly litigation for the company, and at the same time I think it will really make a difference in the lives of some of the most disadvantaged students in the country," said Microsoft Chief Executive Steve Ballmer.
          Robert Lieff, a plaintiffs' attorney who helped negotiate the agreement, said it "permits plaintiffs to generate real benefits to society while at the same time holding Microsoft accountable for its business practices." He said Microsoft's agreeing to pay "a great deal of money is definitely not an admission, but I'd say they're being held accountable."
          After the government filed its antitrust suit against the software company, in 1998, Microsoft was hit with dozens of private lawsuits claiming antitrust violations Many states dismissed the suits because new computer buyers did not buy Windows directly. Some of the remaining cases were consolidated under U.S. District Judge Frederick Motz in Baltimore. Motz is scheduled to hold a preliminary hearing Tuesday to begin discussing whether the settlement is "fair and adequate."
          Under the settlement, Microsoft would:

• Donate $150 million to set up a private foundation that makes grants to local organizations to buy computers and software, with the goal of "providing sustainable, long­term funding for information technology in underserved schools." Microsoft would also provide $100 million for matching grants. Money granted by the foundation could be used to buy non­Microsoft software;
• Pay $160 million into a separate fund, overseen by the foundation, for
  technical­support programs to assist participating schools;
• Contribute up to $90 million over the five­year period to train teachers, administrators and support personnel in integrating technology into the school curriculum;
• Establish a program to ensure not­for­profit organizations provide at least 200,000 refurbished Pentium PCs and Macintosh computers each year, and
• Provide educational and other programs for all the PCs, laptops and Macs a school owns during the five­year period.

Los Angeles Times, "Microsoft Agrees to Settlement for Schools"

Microsoft Corp. said Tuesday that it would give $1 billion worth of software and related goods and services to needy schools in order to settle more than a hundred class­action antitrust lawsuits filed on behalf of millions of consumers.
          At a hearing next week, the world's biggest software company will ask District Judge Frederick Motz to create a national class of affected consumers and then move toward approving the deal.
          Some educators hailed the proposed five­year settlement, which would help the 14% of U.S. schools where 70% or more of the student body is eligible for meal assistance. Yet consumers would get nothing under the accord. Microsoft would pay the class­action lawyers an additional amount set by Motz. Microsoft said it would take a $550­million charge before taxes in the current quarter to cover spending under the settlement.
          Microsoft will be aided by judges' general desire to settle rather than oversee complex trials, by the favorable publicity generated by a deal that aids schools, and by the support of plaintiffs' lawyers including Robert Lieff, a San Francisco attorney who had been helping manage the California consumer cases against Microsoft.

The Recorder, "State, Private Firms Team to Help Sept. 11 Victims"

          California's lawyers are teaming with state government to help secure pro bono legal services for families of victims of the Sept. 11 terrorist attacks. The public­private partnership, which was announced by Gov. Gray Davis on Friday, is designed to assist those who could face immigration issues, the loss of health benefits and wages, or will and probate problems as a result of the worst attack ever on American soil.
          This effort will provide these victims and survivors with a trained advocate who can help protect their legal and property rights, Davis said in a prepared statement Friday. The job of the attorneys is to cut through the red tape, and that pairings between lawyers and families are already being made.
          On board with the program is the State Bar of California, the Bar Association of San Francisco Volunteer Legal Services Program, the Los Angeles County Bar Association and a number of public agencies and private law firms. The firms that have signed on are some of the same that made a pledge to BASF last year to renew their commitment to pro bono.

Note: Lieff Cabraser Heimann & Bernstein is one of the law firms participating in the program.

Austin American-Statesman, "Lawsuits Against Sulzer to Resume"

          An appeals court order issued Monday could open the floodgates for scores of stalled lawsuits to proceed against Austin's Sulzer Orthopedics Inc., hurting the company's efforts to settle with patients who received its faulty hip implants. Sulzer has portrayed its inventive $750 million settlement as a way to fairly compensate patients and stay in business. Company officials said that without it, they would be forced to file for bankruptcy protection.
          The order by the 6th U.S. Circuit Court of Appeals in Cincinnati overturns a lower court ruling that halted the state suits against Sulzer while the judge considered the settlement. U.S. District Judge Kathleen O'Malley in Cleveland had given the proposal preliminary approval and planned to make a final decision in March. But the appellate court said it had "serious doubts as to the legitimacy" of the proposal. The court also said any patient who wanted to opt out of the offer faced "significant financial disincentives," harming their due process rights. Sulzer said it would first pay off patients who agreed to settle; those who sued would have to wait until 2008 to collect.
          The settlement is now in jeopardy, said Tommy Jacks, an Austin lawyer representing several dozen patients suing Sulzer. Richard Heimann, a San Francisco lawyer whose firm represents more than 200 implant clients, said he would proceed with the suits and explore a new settlement that would be "fairer to our clients." Lieff Cabraser did not take a final position on the proposed settlement. Heimann said Monday that though he does not want Sulzer to go out of business, he thinks the company can afford to pay more.

The Recorder, Bar Association of San Francisco, Lieff Cabraser Honor Dru Ramey

          As reported in The Recorder, a legal who's who of San Francisco turned out on October 16th, 1,000 lawyers strong, to bid farewell to Bar Association of San Francisco Executive Director Drucilla Ramey.
          Chief Justice Ronald George, U.S. District Judge Thelton Henderson and Mayor Willie Brown, Jr. were among those who toasted Ramey at the Fairmont Hotel. Ramey, whom speakers repeatedly credited with redefining the role of the local bar association in legal affairs, is moving to New York after 17 years at BASF's helm.
          "We politicians would love to develop the kind of respect that you have developed," Brown said. "And from my personal standpoint, I am delighted that you are making hats what they are." Brown was referring to Ramey's signature fashion statement.
          On a more serious note, BASF President Douglas Young kicked off the evening by announcing that Elizabeth Cabraser of Lieff Cabraser Heimann & Bernstein had endowed the association with $1 million in Ramey's honor. The fund will be used to promote two of Ramey's most passionate causes: BASF's Volunteer Legal Services Program and its equal opportunity projects.
          For her part, Ramey described the evening as "an out of body experience." "I'm not going to say good-bye, because we'd just get all upset," she told the crowd. Besides, she said, her relocation is not permanent, but rather just "a change of venue."

Delaware Law Weekly, "It's Not Chicken Feed"

          A federal wage and hour lawsuit against Perdue Farms Inc. exposes the well-known chicken process to $60 million in potential liability for allegedly underpaying its employees. The suit arose out of the chicken processor's demands that the employees don, doff and clean various items of safety equipment on their own time at processing plants, even though work rules require that equipment.
          Nine plaintiffs filed suit against the large chicken processor in December 1999, seeking damages for the uncompensated time under the federal Fair Labor Standards Act and state wage and hour laws. Plaintiffs also claimed damages under the Employment Retirement Income and Security Act for the company's failure to contribute to a supplemental retirement plan.

Lexington Herald-Leader, "Coal Mined Too Close to Pond, Report Says"

          An engineering study by a federal government contractor says a Martin County Coal Corp. slurry impoundment failed last year because the company had mined too close -- perhaps within 15 feet -- to what became the bottom or side of the coal-waste pond.
          While maps submitted by the company had shown the distance to be about 70 feet, the report said ``this minimal thickness of solid coal barrier, combined with the continually increasing hydrostatic pressure as a result of the rising slurry level, resulted in ... erosion of the barrier and eventual breakthrough of slurry into the mine workings.''
          It is not the first time the barrier between the pond and mineworks has been linked to the 300-million gallon spill on Oct. 11 last year, but the March 30 document -- obtained yesterday by the Herald-Leader -- is the first official written report making the connection that has been made public.

Note: Lieff Cabraser represents approximately 400 individuals (about 270 properties) in Martin County, Kentucky, arising from the October 11, 2000 spill of 2 million gallons of coal slurry from a coal impoundment (a 90-acre coal waste lake) operated by Martin County Coal Corporation. For more information, click here.

Austin American-Statesman, "U.S. Judge Stops Lawsuits Against Sulzer"

          A federal judge in Cleveland has halted individual lawsuits against Sulzer Medica AG while she considers the company's $750 million proposal to settle class action lawsuits over faulty hip implants. U.S. District Judge Kathleen O'Malley's injunction stops dozens of suits from going to trial in state courts this fall, including two cases that had been set for jury selection today in California.
          Lawyers representing Sulzer patients said they would appeal the action to the 6th U.S. Circuit Court of Appeals. If O'Malley's action is upheld, it would be a victory for the Swiss-based company, which has been spending more than $2 million a month on legal bills. O'Malley's ruling, issued Monday, said that Sulzer would be unreasonably burdened if it had to defend itself in dozens of state court cases while also pursuing the federal settlement.
          Sulzer has six months to persuade patients to accept its class action settlement. O'Malley has set a hearing for March 12, 2002 on whether to approve the settlement.
          In California, a state court judge coordinating hundreds of cases is expected to rule this morning whether he'll allow the cases to go forward despite O'Malley's ruling. "The two cases scheduled to start trial this week and about 20 more in mid-October are entitled to go forward under California law," said Richard Heimann, a partner at San Francisco-based Lieff Cabraser Heimann & Bernstein. The firm represents more than 200 clients with faulty Sulzer implants. "She issued this order without giving notice to anybody," Heimann said.

The Associated Press, "U.S. Hip Implants Recalled"

          Hundreds of artificial hips are being recalled because one piece -- the joint ball -- is made of a ceramic that may suddenly crack. It's the second major recall of artificial hips in the past year.
          The Food and Drug Administration announced the recall Friday, warning surgeons not to use the affected implants - and patients to call their doctors if they experience symptoms suggesting the joint has cracked. The FDA has at least 14 reports so far of Americans in whom the recalled hips have broken.
          Symptoms include hip pain, a sensation of grinding or limitation of motion. The fracture sometimes is preceded by an audible pop. The at-risk hips tend to break between 19 and 28 months after they're implanted, said FDA compliance officer Carol Fedorchak.
          The French company St. Gobain Desmarquest recalled nine batches of its ceramic femoral heads -- the ball portion of the hip implant -- that were manufactured since early 1998. The worst batch has an 8 percent breakage rate, well above the one-hundredth of a percent breakage rate expected for such parts, said Fedorchak. The other eight batches had a far lower breakage rate, but were being recalled as a precaution.

The Recorder, "Law Students Get Firm Time With Minority Program"

          Instead of inquiring whether coffee drinkers preferred "tall" or "venti," first-year law school student Loretta James earned her summer money by clerking at Wendel, Rosen, Black & Dean. "You get a very real life experience" in the Bay Area Minority Summer Clerkship Program, said James, a law student at the University of San Francisco who was one of nearly 20 students participating this summer. "Usually, it is really difficult to get into a law firm as a first-year," she said.
          The program, sponsored by the Santa Clara, Alameda and San Francisco bar associations, began in the South Bay in 1990 and has expanded to include firms from San Francisco, Oakland and other cities. Students from Golden Gate University, Santa Clara University, Stanford, University of San Francisco, Boalt Hall and Hastings compete for the paid summer clerkship positions.
          Last month the participating firms were recognized at an Oakland gathering organized by the Alameda County Bar Association. The firms included Lieff Cabraser Heimann & Bernstein.

American Lawyer Daily Report, "Employment Firms: EEOC Boosts Odds for Class Status"

          A few years back, Fred Alvarez flew to New Orleans to fight off a bid by the Equal Employment Opportunity Commission ("EEOC") to intervene in a huge gender-bias case against Atlanta-based Home Depot. The EEOC has long had the authority to file its own pattern and practice suits -- the agency's version of class actions -- to fight employment discrimination, and EEOC officials and plaintiffs' lawyers say there's nothing new or wrong about that. But defense lawyers contend that the agency is finding more occasion to intervene in private suits these days, often at the request of plaintiffs who want help getting around the tough standards for class certification spelled out in the Federal Rules of Civil Procedure.
          Some employer lawyers refer to it as piggybacking. But employee lawyers call EEOC intervention a legitimate way to rout out discrimination, and they insist that their opponents' complaints are purely self-serving.

The San Francisco Chronicle, "$780 Million Offer for Faulty Implants"

          Sulzer Medica Ltd. has offered a settlement of about $780 million in cash and stock to people who received a faulty hip or knee implant in what has become one of the largest orthopedic device recalls in history.
          The settlement, which has yet to be approved, would amount to about $57,500 for a patient who has had to undergo surgery to replace the device. Two-thirds of that sum would be cash, with the rest in Sulzer stock.
          Cherie Lewis of Walnut Creek, California (represented by Lieff Cabraser), who had to endure a second surgery, thought the offer added insult to injury: "Why would I want stock in a company that has already caused me such grief?"
          Sulzer, based in Winterthur, Switzerland, announced the recall in December of about 40,000 artificial hips and has determined about 26,000 of those were implanted in patients. In May, Sulzer announced the recall of about 1,650 knee implants. Sulzer is facing about 1,200 lawsuits from people all over the country who received the faulty implants. So far, about 2,350 people have had the hip implants replaced and another 280 have had to replace the knee part.
          Donald Arbitblit, a partner in the San Francisco law firm of Lieff Cabraser Heimann & Bernstein, LLP, said the firm wants to investigate the company's ability to pay and whether a Swiss firm can be held accountable in California courts. "It must leave a pretty bad feeling to be given stock in a company that has messed up your life," said Arbitblit, whose firm has more than 200 clients and has filed about 100 cases. "The last thing they want to do is have their own personal recovery linked to Sulzer's fortunes."

The American Banker, "New Legal Front in Mortgage Fight: Servicing"

          The mortgage business is under attack from all sides. Consumer groups and lawyers have repeatedly charged lenders with abusive lending practices. A court ruling recently extended liability for predatory lending practices to include buyers of loans in the secondary market. Regulators, too, have been scrutinizing lenders. Now companies that collect payments on mortgage loans are drawing fire.
          In a class action filed in March, Bank United Corp., the Houston thrift company acquired in February by Washington Mutual Inc., is accused of improperly assessing fees, including late fees. The lead plaintiff, Laura Sandoval of Tacoma, is represented by four firms, including two that made headlines in their successful class action against Providian Financial Group.
          Bank United charged property-inspection fees more often and in violation of the law and its own agreement with Ms. Sandoval, the suit claims. It further charges that Bank United delayed processing payments for Ms. Sandoval's mortgage and then applied late payment fees.
          The two law firms from the Providian case that are representing Ms. Sandoval are Girard & Green LP and Lieff Cabraser Heimann & Bernstein LLP, both of San Francisco. In its last fiscal year $18 billion-asset Bank United originated about $3 billion in single-family mortgages and did $31.8 billion of servicing. The thrift started servicing Ms. Sandoval's mortgage in June 1999, when it bought the rights to collect payments on the loan.

The New York Times, "When Medical Devices Fail in the Body"

          Last October, Robert Stahl had his arthritic hip replaced with an artificial one, a ball-and-socket joint made of titanium. Neither Mr. Stahl nor his surgeon knew it, but at that time, the maker of the replacement hip, Sulzer Orthopedics Inc. of Austin, Tex., was investigating reports that its implants were prone to fail. The socket, designed to let bone grow into it and hold it in place, sometimes came loose from the pelvis, causing severe pain and instability. On Dec. 8, Sulzer recalled the hips. By then, Mr. Stahl's implant was already failing. He needed another major operation to replace it.
          The FDA does not require the tracking of artificial hips. Since 1995, there have been 39 recalls of artificial hips, the agency reports. In two-thirds of the recalls, the parts were merely mislabeled, not defective. Of the 13 recalls for manufacturing or design flaws, the Sulzer case is by far the largest: 40,000 sockets, of which 26,000 had been implanted. The company said it did not believe that all 26,000 implanted hips were defective.
          Sulzer has said it will pay for the operations to replace the implants if they are not covered by the patients' insurance, as well as for lost wages and compensation for pain and suffering. Hip replacement surgery typically costs between $20,000 and $50,000. A Jan. 17 fax from Sulzer to Mr. Stahl said, "We will also work with you to compensate you for your lost income on an ongoing basis."
          Mr. Stahl said: "Initially, during the first month or so, they were pretty friendly. I think they believed their own press release that it was only going to be a minor problem. Somewhere around the end of January, they just became a black hole. They stopped replying to anything." Mr. Stahl never received the promised money to replace his lost income -- he is a self-employed corporate trainer -- and after his second operation in February, he sought a lawyer. Sulzer paid some of the expenses of the second operation, Mr. Stahl said.
          "The public relations has been to the effect, they want to take care of everything promptly," said Donald C. Arbitblit, a lawyer with Lieff Cabraser Heimann & Bernstein in San Francisco, the firm representing Mr. Stahl. "I think Sulzer has had a number of credibility problems."

USA Today, "Sprinkler Recall Could Cost Tyco $200 Million; Replacement Could Affect Fire Systems in 9% of USA's Buildings"

          Central Sprinkler's replacement of 35 million potentially faulty fire-suppression sprinkler heads could cost corporate parent Tyco International $200 million over the next 5 years. The recall and replacement effort is the third-largest product-replacement program in Consumer Product Safety Commission history. Only recalls of halogen lamps and window blind cords involved greater numbers of products.
          Central initiated the replacement program after tests showed that the O-ring seals of some model GB series sprinkler heads corroded over time, causing sprinkler heads to fail to activate during fires. The sprinkler heads have been cited in 13 reports of fire-related failures and two property claims.
          Central says the recall could cover sprinklers in up to 9% of the USA's buildings, including offices, homes, apartments, hospitals, day-care centers, schools and nursing homes.
          Central's deal with the CPSC comes as three lawsuits are pending against the company. Central and Tyco face a California state class-action lawsuit over defective sprinkler heads, a federal class-action lawsuit on behalf of other U.S. property owners, and a federal case filed June 20 on behalf of the Building Owners and Managers Association, which represents major commercial-property owners.
          "The scariest part of all this is that their effectiveness decreases over their purported lifetimes, so people have a false sense of safety," says Robert Nelson, lead plaintiff's attorney in the lawsuits for the firm Lieff Cabraser Heimann & Bernstein.

The Recorder, "Migrant Workers Aim for Back Pay"

          Initially, it was set up as protection a mandatory savings program to ensure that Mexican farm and railroad workers laboring in the United States during the 1940s would not go home penniless. At the insistence of the Mexican government, the US government deducted 10 percent of Mexican workers' wages to be transferred to Mexican banks where laborers would be able to withdraw their money.
          Half a century later, Mexican workers, known as braceros, say they never knew about the program and were never paid back the money withheld from their paychecks. Flanked by five prominent plaintiffs firms in the Bay Area, Chicago and New York, retired workers have filed a multimillion-dollar class action against the US and Mexican governments, Wells Fargo Bank and three Mexican banks to recover an estimated $70 million in lost wages, plus interest, damages and attorneys fees. Attorneys working the case say interest and damages could propel the case into the hundreds of millions.

Sacramento Bee, "Hip Implant Toll Mounts in US: 18 Patients in Capital Area May Need Corrective Surgery"

          Eighteen Sacramento-area patients face the possibility of corrective surgery to replace hip implants recalled in December by a Texas medical technology company, officials at Sutter General Hospital said Thursday. More than 70 people received a Sulzer hip implant at Sutter General Hospital in Sacramento between November 1999 and September 2000. Of those, 40 implants were from lots involved in the recall.
          Dr. William Bargar, an orthopedic surgeon at Sutter General, was one of the first physicians in the country to notify Sulzer of problems with the implants after two patients needed surgery in August to remove faulty prostheses, Sutter officials said. After he and another surgeon replaced implants that had failed to bond with surrounding bone, Sutter stopped using the device in September, said spokeswoman Nancy Turner. "At this point, we reported the cases to the company, and Sulzer stated that they only knew of two other cases of loosening, and they didn't know of any manufacturing defect," Turner said.
          Faced with mounting costs in hundreds of US lawsuits arising from the recall, Sulzer Thursday announced plans to separate its US and Swiss orthopedics divisions. Some view Sulzer's reorganization as a bid to shield its European division from the suits. The restructuring, Sulzer spokesman Bill Miller said, created two regional units -- Sulzer Orthopedics USA in Austin and Sulzer Orthopedics Europe/Asia/Latin America based in Baar, Switzerland. "This was a marketing decision," Miller said. "It has nothing to do with the lawsuits."
          Still, attorneys at a San Francisco law firm that has taken a lead role in filing suits against Sulzer said the move shows the Swiss parent company's role in its US operations. "It further demonstrates the control the Swiss entity exercises over the American unit, which goes to our naming both Sulzer Medica and Sulzer Orthopedics in our suits," said Richard Franco, a partner at Lieff Cabraser Heimann & Bernstein in San Francisco.

The Recorder, "Lawyers Divide $59M Fee in German Holocaust Case"

          Lieff Cabraser Heimann & Bernstein was awarded about $3.7 million in attorneys' fees last week for work helping to establish a fund for Holocaust victims and their families. More than 50 lawyers around the country received a piece of the pie to pay legal fees and related costs that accrued during international negotiations leading to the $5 billion fund last July settling all Holocaust claims against German businesses and the government.
          The settlement resolves all German Holocaust claims, including those related to slave labor, insurance and banking. Payment to individual claimants as well as attorneys was held up until the dismissal in recent weeks of more than 50 cases in US courts.
          Surviving slave laborers -- mostly survivors of Jewish concentration camps -- are expected to receive about $7,500 each. Forced laborers who worked in Nazi war factories in Eastern Europe will receive about $2,500 each. Morris Ratner of Lieff Cabraser said he's been handling claims on behalf of Holocaust victims for the last five years. His firm will collect the attorneys' fees involved in the German claims case, but he noted that in a separate case involving Swiss banks his firm donated about $1.4 million earned in attorneys' fees. The funds were donated to New York's Columbia Law School to endow a chair in clinical human rights.

The Austin American-Statesman, "Knee Implant Case Worsens For Sulzer"

          Austin's Sulzer Orthopedics Inc. said Monday that problems with one of its artificial knees may be worse than it had expected.
          Sulzer said a "substantial number" of patients may need to have the faulty implants replaced. It had said earlier that it anticipated few, if any problems, with the implant.
          The knee implants have the same problem that caused Sulzer last year to recall thousands of artificial hips -- traces of oil that prevent them from bonding with bone in some patients. Sulzer has not recalled the knee implants.
          "These are very serious surgeries with very serious injury, stress, anxiety and pain for folks who have these defective knee products," said Richard Heimann, a San Francisco lawyer whose firm is representing numerous hip implant patients. He said Monday he expects to file suit on behalf of up to a dozen knee implant patients..
          Sulzer Orthopedics' parent company, Sulzer Medica, is being spun off from Sulzer AG, a Swiss conglomerate, next month. But Sulzer is not setting the stage to declare bankruptcy, Sulzer spokesman Bill Miller said. Heimann said his firm has included Sulzer's Swiss parents in the lawsuits because it does not think that Texas-based Sulzer can cover all of the claims. Heimann estimated that Sulzer has $250 million in insurance based on financial information from Switzerland. Miller said the company is not disclosing that.

Los Angeles Times, "Drug Makers: New Targets of Class-Action Lawsuits"

          Drug makers in recent weeks have been hit with lawsuits accusing them of blocking cheaper generic versions of lifesaving medications. The suits assert that drug makers used loopholes in the law to stymie competition and unfairly inflate prices of drugs used to treat cancer, heart conditions and other serious maladies. Working in tandem with plaintiffs' attorneys are activist state attorneys general, a combination that helped extract billions of dollars in settlements from cigarette makers. So far, government lawyers have announced one lawsuit, but say other filings are likely.

The Boston Globe, "Consumer Group Sues Three Drug Makers, Alleges Market Manipulation"

          A Boston-based consumer coalition yesterday expanded its legal attack on drug makers, saying that three pharmaceutical companies conspired to keep off the market a cheaper, generic version of a drug used by thousands of elderly Americans. Community Catalyst filed six lawsuits over the drug K-Dur, which is used to treat low blood potassium levels, in a complaint similar to one filed by the Federal Trade Commission in April.
          Like the FTC, Community Catalyst says that when American Home Products and Upsher-Smith tried to bring generic versions of K-Dur to the market in the mid-1990s, Schering-Plough sued the two companies and then entered into settlement agreements that violated antitrust laws.
          Under one agreement, Schering-Plough paid Upsher-Smith $60 million, as long as the company agreed to keep its generic product out of drugstores until September 2001. Schering-Plough also licensed five products from Upsher-Smith, but has never sold four of the products, the complaint alleges.
          In a similar agreement with a division of American Home Products, ESI Lederle, Schering-Plough agreed to pay the company up to $30 million in return for ESI keeping its generic potassium supplement off the market until January 2004. Schering-Plough also licensed two products from ESI, though it has made no sales of those products, Community Catalyst said.

The Philadelphia Inquirer, "Hotel chains sued for California energy surcharges"

          California's power crunch has prompted many hotels to start assessing energy surcharges. Now a San Francisco law firm has filed a class action suit against several big hotel chains, contending that charging extra for electricity is illegal.
           Barry R. Himmelstein of Lieff Cabraser Heimann & Bernstein filed separate lawsuits against the Starwood, Hilton, Hyatt and Marriott hotel chains, challenging the hotels' practice of adding undisclosed energy surcharges to room bills.
          The suits, filed in San Francisco Superior Court and one against Marriott in Los Angeles Superior Court, allege that the chains "repeatedly breached their contracts with customers and committed unfair and deceptive business practices by imposing 'energy surcharges' above and beyond the basic room rates that customers are quoted when they make their reservations."
          The hotel suits cite state law, but the issue applies to more than California. The Sheraton Austin Hotel in Austin, Texas, in recent months posted a sign on the check-in counter citing the current high cost of energy and announcing a surcharge of $2.50 per room per night, plus tax.

The Recorder, "Locals Hit The Road For AIDS Bike Ride"

          In the first week of January, Sarah Kowalski plunked down her $55 registration fee for the ride. By the end of the month, she'd signed on as an associate with Farella Braun & Martel. Even though Kowalski, 30, mountain biked recreationally, she didn't have a pair of road biking shorts to her name. Over the past six months, Ms. Kowalski crammed an arduous training regimen of hundreds and hundreds of cycling miles in between her personal life and practice -- and, in the process, raised thousands of dollars to benefit the San Francisco AIDS Foundation.
          Lisa Leebove, 30, at Lieff Cabraser Heimann & Bernstein, had an equally intense training schedule. A first-time rider, she started her days off with spinning and other exercise classes at 5:30 in the morning twice weekly before work. She also headed to the gym for a two-hour evening workout once a week after wrapping up her day's practice in Lieff Cabraser's San Francisco headquarters. A partner she works under, Jonathan Selbin, supported her as few partners would.
          "[Once] he stayed at night until four in the morning so I could get home early and go to bed to train at 5 a.m.," she said. Leebove also remembers a number of out-of-town assignments Selbin could have used her help on, but he let her stay in San Francisco to make sure she could keep up her training. "I'm sure he'll cash in his chips eventually," she said. Lieff Cabraser has also sponsored her with $2,000.

The Disability Compliance Bulletin, "New suit claims that high school exit exam discriminates based on disability"

          California's implementation of a high school exit examination is being challenged by a new federal lawsuit, which claims that the exam unlawfully discriminates against students with disabilities. The suit challenges the alleged absence of procedures relating to the provision of accommodations and alternate assessments. It also says that the exam tests some disabled students on materials they have never been taught.
          Attorneys at Disability Rights Advocates in Oakland, California, filed the suit earlier this month along with Morris Ratner of San Francisco's Lieff Cabraser Heimann & Bernstein, LLP. The plaintiffs are three students with learning disabilities and the Learning Disabilities Association of America, a volunteer organization that advocates for the rights of people with learning disabilities. The defendants include the California Department of Education and the Fremont Unified School District.

The San Francisco Chronicle, "Implant producer pulls product; Company also recalled hip"

          Sulzer Orthopedics Inc., the company that produced a faulty hip implant that led to a worldwide recall in December, is investigating a potential problem in one of its artificial knee parts.
          The Austin, Texas, manufacturer is not recalling the product but withdrew it from the market in March. The company has notified the US Food and Drug Administration about the investigation and also sent a letter to doctors.

The Recorder, "Cal Micro Fraud Suit Settles for Total of $26 Million"

          If only every week were this good for Lieff Cabraser Heimann & Bernstein. First the firm netted more than $2 million of an approved $30 million settlement in securities fraud litigation involving Network Associates Inc. Then on Thursday it settled the final piece of a long-running securities fraud case over faulty financial statements at Cal Micro Devices Corp.
          US District Judge Vaughn Walker approved the final piece of a total settlement of around $26 million. Under the agreement, former Cal Micro executive Chan Desaigoudar will turn over more than 1 million shares of the company, worth around $7 million.

The Recorder, "Alsup's Securities Experiment Settles"

          On Monday, US District Judge William Alsup approved a class settlement in the Network Associates securities litigation of $30 million and attorneys' fees of just 7 percent, a figure far below the benchmark and one which was hailed as proof that a novel process of requiring firms to bid for class counsel status means more money for class members.
          Judge Alsup had balked at rubber-stamping a Philadelphia pension fund's selection of class counsel and when the fund backed out of the case, he personally interviewed replacements.
          Eventually, he chose lawyer Robert Vatuone as the lead plaintiff. Through the bidding process, which remains rare but is gaining wider acceptance, Vatuone chose Lieff Cabraser Heimann & Bernstein to represent the class.
          In the end, Alsup approved the 7 percent fee agreement, which will be calculated after Lieff Cabraser deducts expenses of approximately $360,000. The firm will earn more than $2 million for its work on the case.
          The fee is far below the benchmark in such cases, and Alsup's intention to find a lead plaintiff to adequately navigate the litigation and drive a hard bargain on fees seems to have worked. Even class action critic Lawrence Schonbrun submitted a declaration approving the agreement.

San Francisco Examiner, "S.F. Woman Sues Two Drug Firms"

          A San Francisco woman has filed a proposed class-action suit against two drug manufacturers she claims unfairly made millions from women suffering with breast cancer. The suit states that Barr Laboratories unlawfully colluded with AstraZeneca Pharmaceuticals to artificially raise the price of the drug tamoxifen
          Tamoxifen, sold by AstraZeneca under the brand name Nolvadex, is a popular drug used to treat breast cancer. According to the American Cancer Society, about 182,800 women are diagnosed with breast cancer each year and 40,800 people annually die from the disease. It is the second most common cancer in women, following skin cancer.
          San Francisco attorney Eric Fastiff, whose firm is working on the case, said the sheer number of people affected is enormous, as nearly everyone diagnosed with the disease is prescribed tamoxifen Members of the class would include anyone who has purchased the drug during the last four years, potentially millions of plaintiffs. "It's very hard to find a woman that hasn't taken the drug or who knows someone that has," he said.

New York Law Journal, "Holocaust Pact Wins Judge's Approval"

          Southern District Judge Shirley Wohl Kram cleared the way yesterday for the payment of billions of dollars in reparations to victims of the Holocaust. After refusing twice during the last four months to dismiss claims in 10 consolidated class actions charging that German and Austrian banks looted accounts and seized property during the Nazi-era's "Aryanization" campaign, Judge Kram said she felt that the remaining impediments to a proposed settlement in the cases had been removed.
          Judge Kram said she was satisfied that certain claims holders would be adequately represented in the settlement. "I want to commend everyone for expediting these developments," Judge Kram stated.
          The dismissal of the cases that make up In re Austrian and German Bank Holocaust Litigation, 98 Civ. 3938, was the last major bar to the payment of $5.4 billion to Holocaust victims from a foundation created