Lieff Cabraser: Consumer Law Newsletter Issue No. 14

Consumer Law Newsletter:
Issue No. 14

April 7, 2004

Top News

Focus on Employee Rights: New York Times Reports In-House Audit Says Wal-Mart Violated Labor Laws and Time Records Often Altered by Other Employers
Federal Court Upholds Fraud Complaint Against Manufacturers of Prostate Cancer Prescription Drug
Hundreds of Millions of Dollars in Class Action Settlement Funds Still Available for Homeowners with Defective Hardboard Siding
Lieff Cabraser Represents Clients in Three Simultaneous Trials in the South; Cases Involve Retiree Pension Benefits, Environmental Damage and Desecration of Human Remains
$4.5 Billion Punitive Damages Award Against Exxon Reinstated
Lieff Cabraser Attorneys Recognized for Outstanding Work
Alaska Attorney General and Lieff Cabraser File Securities Fraud Lawsuit Against America Online and Time Warner

Introduction

The Consumer Law Newsletter is published quarterly by the national law firm of Lieff Cabraser Heimann & Bernstein, LLP. We hope you find the newsletter of interest. The newsletter is sent to all persons that have contacted our law firm via the internet and agreed to receive the newsletter. We do not sell to third parties or transfer in any way your personal information, including email addresses. If you do not wish to receive any future editions of this newsletter, there are instructions at the bottom on how to remove yourself from our recipient list.

Top News

Focus on Employee Rights: New York Times Reports In-House Audit Says Wal-Mart Violated Labor Laws and Time Records Often Altered by Other Employers

As reported in the New York Times in January 2004, an internal audit warned top executives at Wal-Mart three years ago that employee records at 128 stores pointed to extensive violations of child-labor laws and state regulations requiring time for breaks and meals.

Lieff Cabraser is representing Wal-Mart employees in New York and Washington states. The employees charge that Wal-Mart systematically avoids paying employees their full, earned wages. Wal-Mart provides incentives for managers to lower overhead which allegedly results in managers under-staffing stores and forcing employees to work off-the-clock and through lunch and rest breaks. To learn more about Lieff Cabraser's litigation against Wal-Mart, click here.

In April 2004, the New York Times reported that experts on compensation say that the illegal doctoring of hourly employees' time records is far more prevalent than most Americans believe. The practice, commonly called "shaving time," is easily done and hard to detect -- a simple matter of computer keystrokes -- and has spurred a growing number of lawsuits and settlements against a wide range of businesses.

Lieff Cabraser has obtained lost wages and benefits for thousands of employees across America who were not paid for work performed or improperly denied overtime pay. In a new lawsuit identified by Business Week as one that could "change the tech industry," we are representing IT employees, technical staff and system administrators of Computer Sciences Corporation for failing to pay their workers overtime pay. Many computer companies, including CSC (as alleged in the lawsuit), unlawfully label employees who install and maintain computer software and equipment as exempt in order to deprive them of overtime pay.

To learn more about Lieff Cabraser's overtime pay and fair pay cases, or to contact a Lieff Cabraser employment attorney, please click here.

Federal Court Upholds Fraud Complaint Against Manufacturers of Prostate Cancer Prescription Drug

In November 2003, U.S. District Court Judge Richard G. Stearns denied the majority of arguments raised by defendants Abbott Laboratories, Takeda Chemical Industries and TAP Pharmaceuticals, the manufacturers of Lupron, in support of their motion to dismiss a federal class action lawsuit. Lupron is the brand name for a prescription drug used to treat a number of diseases, including prostate cancer and endometriosis.

Plaintiffs, cancer patients and health care plans, allege that defendants conspired to overstate the drug's average wholesale price ("AWP"). The AWP is the rate upon which Medicare bases the reimbursement and co-payment. Plaintiffs charge that the AWP for Lupron as reported by defendants bore no resemblance to the actual prices charged by defendants to physicians for Lupron. As a result, Medicare, Medicare patients and health care plans paid deliberately inflated prices for Lupron.

Defendants claimed that they had no duty to disclose that Lupron's AWP was a "sticker price" and never intended to reflect the drug's true average wholesale price. Judge Stearns rejected this argument, commenting that "there is a difference between a sticker price and a sucker price."

Lieff Cabraser is serving as co-counsel for plaintiffs in the Lupron suit. We are also at the forefront of litigation challenging the high prices of dozens of other prescription drugs, alleging that the manufacturers engaged in anticompetitive practices designed to artificially inflate the drug prices. To learn more about this litigation, please click here.

Hundreds of Millions of Dollars in Class Action Settlement Funds Still Available for Owners of Homes with Defective Hardboard Siding

Lieff Cabraser has obtained compensation for homeowners across America from manufacturers of home building products such as hardboard siding and roof shingles that failed to perform as promised. Hundreds of millions of dollars in settlement funds are currently available to qualified class members. In particular, homeowners should be aware of two class action settlements involving allegedly defective hardboard siding.

The first settlement covers owners of structures on which Weyerhaeuser-brand exterior hardboard siding was applied at any time from January 1, 1981, through December 31, 1999. Weyerhaeuser will pay all timely and qualified claims for qualifying damage associated with its siding. There is no limit on the total monetary damages to be paid.

Under the Weyerhaeuser settlement, three different deadlines govern the submission of claims. The more recently your home's siding was installed, the longer you will have to file your claim. Property owners whose home siding was installed between January 1, 1988, and December 31, 1993, have until December 2006 to submit their claims. For siding that was installed between January 1, 1994, and December 31, 1999, the claims deadline is December 2009.

For complete information on the Weyerhaeuser settlement, and to request claim forms, please visit http://www.weyerclaims.com. Note: For property owners whose siding was installed January 1, 1981, through December 31, 1987, the deadline to submit claims expired in December 2003.

The second nationwide class action settlement, approved in 1998, compensates homeowners for the cost of repairing and replacing failing Masonite hardboard siding installed on homes and other structures with qualifying damage between January 1, 1980, and January 1, 1998. To date, the settlement, valued at up to $1 billion, has paid out over five hundred million dollars to homeowners.

Like the Weyerhaeuser settlement, the Masonite settlement also has staggered deadlines for submitting claims. If you own Masonite hardboard siding installed on your home between January 1, 1980, and December 31, 1989, you must file your claim by January 2005. Persons with Masonite hardboard siding installed between January 1, 1990, and January 15, 1998, have until January 2008 to file a claim. To learn more about the Masonite settlement, please visit www.masoniteclaims.com or call the claims administrator toll-free at 1-800-330-2722.

Lieff Cabraser Represents Clients in Three Simultaneous
Trials in the South; Cases Involve Retiree Pension Benefits, Environmental Damage and Desecration of Human Remains

Lieff Cabraser is dedicated to advancing the rights of plaintiffs, bringing their claims to trial when necessary to achieve justice. In 2004, Lieff Cabraser, with its co-counsel, commenced three trials in different courts, all in the American South.

The first case was Dupree, et al., v. The Prudential Insurance Company. On February 17, 2004, Lieff Cabraser began a trial in federal court in Florida on behalf of retired employees of Prudential Financial, Inc. Plaintiffs intend to prove that Prudential violated the Employee Retirement Income Security Act ("ERISA") by using the Retirement Plan's assets for its own benefit, instead of for the benefit of the retirees. Plaintiffs have asked the court to order Prudential to restore to the Retirement Plan all of the Plan assets that Prudential removed from the Plan in violation of the law. Lieff Cabraser partner David S. Stellings is co-lead trial counsel, and made plaintiffs' opening statement. The trial in chief recently concluded. Closing arguments are scheduled for September.

The second case was West v. G&H Seed Co., et al. On March 1, 2004, Lieff Cabraser began impaneling a jury for a Louisiana state court class action against Aventis CropScience USA LP and others on behalf of about 1,500 crawfish farmers. During four weeks of trial, the crawfish farmers put on evidence that their crawfish crops were devastated by a defective and toxic pesticide applied to rice in or near their crawfish ponds. Prior to the conclusion of the trial, the parties reached a $45 million settlement. To learn more about the Crawfish settlement, please visit www.lacrawfishcase.com.

The final case was In re Tri-State Crematory. On March 1, 2004, trial began in federal court in Georgia on behalf of a class of families of victims bringing claims for improper cremations and desecration of human remains by the Tri-State Crematory in Noble, Georgia, and against the funeral homes with which it did business. One week into the trial, the court granted preliminary approval to a $40 million settlement with all defendants. Lieff Cabraser was co-lead trial counsel, with partners Elizabeth J. Cabraser and Kathryn E. Barnett leading the trial team. Ms. Barnett gave the opening statement for plaintiffs. To learn more about the settlement, please visit www.crematoryclassaction.com.

$4.5 Billion Punitive Damages Award Against Exxon Reinstated

On January 28, 2004, U.S. District Court Judge H. Russell Holland in Anchorage, Alaska reinstated the punitive damages award imposed against Exxon Corporation for the grounding of the Exxon Valdez in 1989. The court found that Exxon's recklessness gravely affected the livelihood of thousands of persons and that "the social fabric of Prince William Sound and Lower Cook Inlet was torn apart."

As background, the Exxon Valdez ran aground in March of 1989, spilling 11 million gallons of oil into Prince William Sound. A class action jury trial was held in federal court in Anchorage, Alaska in 1994, in which Lieff Cabraser served as co-counsel. The jury awarded $5 billion in punitive damages to the plaintiff class. The plaintiff class consists of 32,000 fisherman, Alaska natives, landowners and others whose livelihoods were gravely affected by the disaster.

The punitive damages award has been on repeated appeal by the Exxon Corporation ever since. In 2001, the Ninth Circuit Court of Appeals ruled that the original $5 billion punitive damages verdict was excessive. In 2002, Judge Holland reinstated the award at $4 billion. Judge Holland stated that, "Exxon officials knew that carrying huge volumes of crude oil through Prince William sound was a dangerous business, yet they knowingly permitted a relapsed alcoholic to direct the operation of the Exxon Valdez through Prince William Sound."

In 2003, the Ninth Circuit again directed Judge Holland to reconsider the punitive damages award under United States Supreme Court punitive damages guidelines.

On January 28, 2004, Judge Holland issued his order finding that recent Supreme Court decisions did not change the court's earlier analysis. The court specifically found that a punitive damages award of $4.5 billion plus $2.25 billion in interest was in accordance with Supreme Court authority.

Notwithstanding this repeated judicial review and vindication of the jury's decision, Exxon has stated that it will appeal the punitive damages award yet again. To date, the plaintiffs and victims of the Exxon Valdez disaster have waited 15 years for the resolution of their case.

Lieff Cabraser Attorneys Recognized for Outstanding Work

In February 2004, The Corporate Legal Times identified Elizabeth J. Cabraser as one of the five most respected plaintiffs' attorneys in the nation. The journal commented that Ms. Cabraser "is best known for her work as the not-so-secret-weapon of the plaintiffs' bar, swooping in to argue major points of law in high-profile cases or to coordinate multistate litigation. Since teaming up with Robert Lieff in 1978, she has worked on more than 250 class actions. She's won nearly $6 billion for clients in the past three years alone."

In March 2004, The Recorder, a leading San Francisco Bay Area legal newspaper, included Lieff Cabraser partner Kelly M. Dermody in the results of its survey of top employment law attorneys. The survey was based on interviews with attorneys, mediators and corporate clients exceptionally knowledgeable about employment litigation. The Recorder noted Ms. Dermody has "earned respect for her class action successes."

Alaska Attorney General and Lieff Cabraser File Securities Fraud Lawsuit Against America Online and Time Warner

On April 1, 2004, in Juneau, Alaska, Alaska Attorney General Gregg Renkes filed a complaint in Alaska state court against America Online, Inc. ("AOL"), Time Warner, Inc., and several other defendants. The complaint alleges that various State of Alaska funds incurred substantial losses in their investments in AOL and Time Warner stock because the defendants misrepresented AOL's revenues and subscriber numbers before and after the merger of AOL and Time Warner.

"We are no longer going to rely on the federal courts located in far flung jurisdictions to protect our interests," stated Attorney General Gregg Renkes. "The defendants' actions violated Alaska's state law and so we are seeking recovery right here in the Juneau Superior Court."

Lieff Cabraser is serving as co-counsel for the Alaska Department of Law. To learn more about Lieff Cabraser securities practice, please click here.

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