Lieff Cabraser: Consumer Law Newsletter Issue No. 8

Consumer Law Newsletter:
Issue No. 8

April 11, 2002

Top News

Sulzer Doubles Settlement Offer to Injured Hip and Knee Implant
Patients
Direct Merchants Bank Credit Card Case Update
Manipulation of the High Tech IPO Stock Market Leads to Lawsuits
Lieff Cabraser Represents Families in Georgia Cremations Case
Pharmaceutical Companies Charged with Inflating Prices of
Prescription Drugs

Introduction

The Consumer Law Newsletter is published quarterly by the national law firm of Lieff Cabraser Heimann & Bernstein, LLP. The Newsletter is sent to persons who have contacted our firm via the internet and provided their e-mail address. We do not share e-mail addresses with any third party.

Top News

Sulzer Doubles Settlement Offer to Injured Hip and Knee Implant Patients

On March 14, 2002, U.S. District Judge Kathleen O'Malley granted preliminary approval to a new proposed settlement agreement between Sulzer and plaintiffs' counsel. Under the terms of the revised proposed settlement agreement, valued at over $1 billion, patients with defectivehip and knee implants produced by Sulzer Orthopedics, Inc., will now receive $200,000, minus attorneys fees, for each qualifying hip or knee that failed and required revision surgery, in exchange for settling their claims against the company. The new settlement, which is subject to final review by the court at a hearing set for May 6, 2002, more than doubles the payments to Sulzer hip and knee patients who have had revision surgery as compared to Sulzer’s original offer announced in August 2001.

In addition, the new settlement includes an Extraordinary Injury
Fund or "EIF," which provides additional compensation for serious
complications from having the defective implants. For those patients that qualify, and depending on the total number of approved EIF claims under the settlement terms and the severity of injury, payments per person may range from about $40,000 to several hundred thousand dollars.

Lieff Cabraser fought against Sulzer's original settlement offer
as insufficient and played a significant role in helping craft the new
settlement. Commenting on the new settlement in the March 15, 2002, Austin American-Statesman, Lieff Cabraser partner Richard Heimann stated, "We've done our level best to fashion a settlement that provides the most compensation that Sulzer and the other defendants are able to pay to compensate those individuals."

Direct Merchants Bank Credit Card Case Update

Lieff Cabraser represents consumers in a class action lawsuit against Direct Merchants Bank for allegedly engaging in unlawful business practices that have harmed cardholders nationwide. Plaintiffs challenge the Direct Merchants' practices with respect to, among other things, fee-based products and services; late fees; overlimit fees; cash advance checks; balance transfers; and annual percentage rates.

After almost two years of investigation and litigation, on
February 1, 2002, Minnesota Judge Mary E. Steenson granted preliminary approval of a proposed settlement. Under the proposed settlement, Direct Merchants has agreed to modify or cease certain business practices; offer certain free products, services or benefits to former cardholders or ServiceEdge members who are not current cardholders; and offer participation in a Customer Satisfaction Guarantee Program to current cardholders, in which current cardholders may resolve the complaints, including for monetary credits in an amount between $10.00 and $70.00.

On May 30, 2002, the court will make a final determination of the reasonableness and fairness of the settlement.

Manipulation of the High Tech IPO Stock Market Leads to Lawsuits

During the late 1990's and 2000, the market for initial public
offerings ("IPOs"), often in shares of technology companies, reached
levels never seen before in the history of Wall Street. In 1999, the
biggest boom year for IPOs, 547 deals were completed, raising $68.8
billion. Even more money was raised in 2000.

The corporate insiders and favored customers who received large subscriptions of the shares in these companies profited tremendously. The IPO boom also resulted in unprecedented financial gains for the investment banks that served as underwriters of the stock. In lawsuits, it has been alleged that the underwriters created a frenzy over which preferred customers would be granted special access to the high tech IPOs, and helped inflate the after-market price paid by individual investors.

Many small investors incurred devastating losses when they rushed to buy the new stocks just as the corporate insiders and preferred customers of the underwriters were selling. Furthermore, and unknown to small investors, certain underwriters generated profits from the IPO boom not only through the fees they charged for their services in bringing the companies to the market, but also by operating kickback schemes with their preferred customers.

Private class action lawsuits have been filed against the high
tech securities underwriters claiming that they violated federal
securities laws by omitting and/or misrepresenting material facts in the
prospectuses, the disclosure statements filed with the SEC and relied upon by investors purchasing shares in the company. Investigations are also occurring concerning the activities of top executives of the companies whose shares were brought to the market in the IPOs.

Lieff Cabraser Represents Families in Georgia Cremations Case

In February 2002, Lieff Cabraser filed class action lawsuits
against Tri-State Crematory and the funeral homes that contracted with
Tri-State on behalf of all families whose loved ones' remains were
delivered to the crematorium. Tri-State, located in Noble, Georgia, had been in business for almost 30 years and received bodies from funeral homes in Alabama, Georgia and Tennessee. For years, Tri-State failed to perform cremations, passing off wood chips and other substances as ashes. In at least nine cases, the ashes provided by Tri-State to relatives turned out to be powdered cement. Over 300 sets of human remains in varying states of decomposition have been found on the crematory grounds.

"Some families do not know what happened to their loved ones'
remains. These families do not know if the ashes they were given for
burial are those of their loved one, if what they thought were ashes are
human remains, or if their loved ones were ever cremated," observed Lieff Cabraser attorney Kathryn Barnett. The lawsuits request court supervision of the Tri-State property, the establishment of a constructive trust over all of Tri-State's assets for the benefit of the families, and monetary damages against Tri-State and the funeral homes that contracted with Tri-State for allegedly failing to monitor and supervise Tri-State.

For more information on the Tri-State lawsuits, click here.

Pharmaceutical Companies Charged with Inflating Prices of Prescription Drugs

Lieff Cabraser is at the forefront of litigation challenging the
prices of dozens of prescription drugs used by millions of Americans.
Among the prescription drugs that are subject to this litigation are the
anti-anxiety medication Buspar, the antibiotic Cipro, the allergy
medication Claritin, K-Dur 20, a potassium chloride supplement used to treat patients with low blood potassium levels, Neurontin, prescribed for epileptics, and Tamoxifen, sold under the brand name Nolvadex, which is the most widely prescribed breast cancer drug in the U.S.

The lawsuits allege that the manufacturers have engaged in
anticompetitive practices that have artificially inflated drug prices.
The objective of this litigation is to obtain judicial enforcement of
federal and state antitrust and consumer protection laws in order to
remedy past overcharges for prescription drugs, and to make affordable pharmaceuticals more accessible in the future to all consumers.

To read about each of these lawsuits, please visit
Prescription Drugs Lawsuits.com.