Class Action Lawsuits, Lawyers And Settlements: Review of Cases 2001-2003

Successes 2001-2003

1998-2000 | 2001-2003 | 2004-2005 | 2006-2007

Lieff Cabraser Heimann & Bernstein, LLP is a fifty-plus attorney law firm with offices in San Francisco, New York and Nashville. Our lawyers represent plaintiffs in individual lawsuits and class actions across America in cases involving dangerous or defective products; consumer, securities and investment fraud; employment discrimination; overtime pay and ERISA violations; environmental damage and toxic exposures; antitrust violations; aviation disasters; and the abuse of civil and human rights.

For the past five years, The National Law Journal has selected Lieff Cabraser as one of the top plaintiffs' law firms in the nation. The National Law Journal examined recent verdicts and settlements in class actions and individual lawsuits. The editors also contacted plaintiff and defense counsel, as well as dozens of corporate general counsel, asking them for the names of plaintiffs' litigation firms that they would use and recommend.

The following is a summary of the outcomes of recent Lieff Cabraser cases. For a comprehensive listing of our prominent cases, please see our firm resume.

2003

El Paso Natural Gas Antitrust Case

Lieff Cabraser represents California residential and business consumers of natural gas in a class action lawsuit against El Paso Natural Gas. The complaint alleged that during the California energy crisis in 2000-2001, El Paso rigged bids and otherwise manipulated the market for natural gas pipeline transmission capacity into California so that its energy trading subsidiary would acquire the capacity, and then used the capacity to drive up prices on the spot market for California consumers and businesses in violation of antitrust and unfair competition laws.

In December 2003, Superior Court Judge J. Richard Haden granted final approval to an almost $1.5 billion class action settlement in the El Paso Natural Gas Anti-Trust Cases (J.C.C.P. Nos. 4221, 4224, 4226 & 4228). The settlement class, with certain exceptions, includes all California residential and business consumers that purchased natural gas or electricity between September 1, 1996 and March 20, 2003.

In June 2007, the Court granted final approval to a $67.39 million settlement of a series of class action lawsuits brought by California business and residential consumers of natural gas against a group of natural gas suppliers, Reliant Energy Services, Inc., Duke Energy Trading and Marketing LLC, CMS Energy Resources Management Company, and Aquila Merchant Services, Inc.

BuSpar Antitrust Litigation

Lieff Cabraser serves as Co-Lead Counsel in consolidated litigation on behalf of individual consumers, consumer organizations, and third party payors that purchased BuSpar, a drug prescribed to alleviate symptoms of anxiety. In November 2003, the Court granted final approval to a $90 million cash settlement with Bristol-Myers Squibb Co. (BMS).

Plaintiffs alleged that BMS, Danbury Pharmacal, Inc., Watson Pharmaceuticals, Inc. and Watson Pharma, Inc. entered into an unlawful agreement in restraint of trade under which BMS paid a potential generic manufacturer of BuSpar to drop its challenge to BMS’ patent and refrain from entering the market. Further, Plaintiffs alleged that BMS misrepresented the scope of a later patent related to BuSpar thus causing the FDA to list this new patent in its Orange Book and again prevent generic manufacturers from entering the market. As a result, consumers and third party payors have had to pay more for BuSpar or generic buspirone than they would have absent the defendants’ unlawful conduct.

Richison v. American Cemwood Corp.

Lieff Cabraser is Co-lead Class Counsel for an estimated class of 30,000 owners of homes and other structures on which defective Cemwood Shakes were installed. In May 2000, the Court granted final approval of a Partial Settlement with Cemwood's parent companies, and in November 2003, the Court granted final approval to a Phase 2 Settlement with Cemwood and certain of Cemwood's insurers. The combined value of the two Settlements is $140 million. Class members may file a claim until the year 2015. There is no cap on the amount a Class member can receive under the Settlements. Instead, Class members with qualifying damage will receive a pro rata share of the Settlement funds according to the size of their roofs.

Citigroup Loan ("The Associates Predatory Lending") Cases

Prior to its acquisition in November 2000, Associates First Financial, referred to as The Associates, was one of the nation’s largest “subprime” lenders. Lieff Cabraser represents former customers of The Associates and related companies in a class action suit alleging that The Associates packed mortgage loans with unwanted and unnecessary insurance products and engaged in improper loan refinancing practices. In April 2003, the Court granted final approval to a settlement of the action that will provide up to $240 million in relief to former Associates’ customers nation-wide.

Kline v. The Progressive Corporation

Lieff Cabraser served as settlement class counsel in this nationwide consumer class action involving challenges to the Progressive Corporation’s private passenger automobile insurance sales practices, where plaintiffs alleged that the Progressive Corporation wrongfully concealed from class members the availability of lower priced insurance for which they qualified. The Settlement Class was certified and the settlement was granted final approval in 2002, and is valued at approximately $450 million, including both cash and equitable relief. The claims program, implemented upon a nationwide mail and publication notice program, was completed in early 2003.

Microsoft Private Antitrust Litigation

Lieff Cabraser is prosecuting cases on behalf of businesses and consumers against Microsoft Corporation in various state courts across the country, including Florida, New York, North Carolina, and Tennessee. Plaintiffs allege that Microsoft engaged in anticompetitive conduct and/or violated state deceptive and unfair business practices statutes to harm competition and monopolize the markets for Intel-compatible, personal computer operating system software, as well as word processing and spreadsheet software. In November 2003, in the Florida Microsoft litigation, the Court granted final approval to a $202 million settlement, one of the largest antitrust settlements in Florida history. In June 2004, the Court in the Tennessee action granted final approval to a $64 million settlement. In August 2004, the Court in the North Carolina action granted final approval to a settlement valued at over $89 million.

Kentucky Coal Sludge Disaster

On October 11, 2000, near Inez, Kentucky, a coal waste storage facility ruptured, spilling 300 million gallons of coal sludge (a wet mixture produced by the treatment and cleaning of coal) into waterways in the region and contaminating hundreds of properties. This was one of the worst environmental disasters ever in the Southeastern U.S. With co-counsel, Lieff Cabraser represented over 400 clients in property damage claims, including claims for diminution in the value of their homes and properties. In April 2003, the parties reached a confidential settlement agreement on favorable terms to the plaintiffs.

2002

Perdue Farms Wage and Hour Class Action

Lieff Cabraser represents a class of approximately 60,000 current and former chicken processing employees of Perdue Farms, Inc., one of the nation’s largest poultry processors, in a suit against Perdue Farms for wage and hour violations. The suit challenges Perdue’s failure to compensate its assembly line employees for putting on, taking off, and cleaning protective and sanitary equipment in violation of the Fair Labor Standards Act, various state wage and hour laws, and the Employee Retirement Income Security Act.

On October 17, 2002, the Court granted final approval to a settlement of the case. Under the settlement, Perdue will pay $10 million for wages lost by its chicken processing employees and issue negative credit under its retirement plans for workers' time spent "donning and doffing." This settlement is in addition to the $10 million settlement between the Department of Labor and Perdue announced on May 9, 2002.

Sulzer Hip and Knee Implants Litigation

In December 2000, Sulzer Orthopedics, Inc., announced the recall of approximately 40,000 units of its Inter-Op Acetabular Shell Hip Implant, followed in May 2001 with a notification of failures of its Natural Knee II Tibial Baseplate Knee Implant. In August 2001 in the federal litigation, In re Sulzer Hip Prosthesis and Knee Prosthesis Liability Litigation, MDL 1410, the Court granted preliminary approval to a proposed class action settlement providing for a combination of cash and stock, subject to restrictions on its sale, valued at approximately $650 million.

Lieff Cabraser was not involved in the negotiations that resulted in this settlement offer, and on behalf of our clients vigorously objected to it as insufficient. Thereafter, Lieff Cabraser played a significant role in creating a revised settlement with Sulzer valued at more than $1 billion that more than doubled the cash payments to injured claimants than under the original settlement. In May 2002, the Court granted final approval to the revised settlement. We continue to represent injured hip and knee implant patients forced to undergo revision surgery.

Direct Merchants Credit Card Bank Class Action

Lieff Cabraser served as Plaintiffs’ Co-Counsel in a national consumer class action filed on behalf of millions of Direct Merchants’ credit cardholders who alleged that defendants engaged in unfair, deceptive and misleading practices and violated state consumer protection statutes in connection with the sale and marketing of their credit cards and fee-based services and products.

In May 2002, the Court granted final approval to a settlement that requires defendants 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 ("CSGP") to current cardholders, in which current cardholders may resolve their complaints, including for monetary credits in an amount between $10.00 and $70.00.

Scorpion Technologies Securities Litigation including Claghorn v. Edsaco

Lieff Cabraser is nationally recognized for its representation of shareholders in cases alleging violations of federal securities laws by major corporations and their directors, including many of the most publicized financial frauds arising out of Silicon Valley. For example, we served as co-lead counsel in class action suits arising out of an alleged fraudulent scheme by Scorpion Technologies, Inc., certain of its officers, accountants, underwriters and business affiliates to inflate the company’s earnings through reporting fictitious sales.

In Scorpion I, the Court found plaintiffs had presented sufficient evidence of liability under Federal securities acts against the accounting firm Grant Thornton for the case to proceed to trial. In re Scorpion Techs., 1996 U.S. Dist. LEXIS 22294 (N.D. Cal. Mar. 27, 1996). In 1988, the Court approved a $5.5 million settlement with Grant Thornton. In 2000, the Court approved a $950,000 settlement with Credit Suisse First Boston Corporation.

In April 2002, a federal jury in San Francisco, California returned a $170.7 million verdict against Edsaco Ltd. The jury found that Edsaco aided Scorpion in setting up phony European companies as part of scheme in which Scorpion reported fictitious sales of its software to these companies, thereby inflating its earnings. Included in the jury verdict was $165 million in punitive damages.The verdict against Edsaco constitutes the twelfth largest verdict in the U.S. in 2002. Subsequently, the parties reached a settlement of the action on favorable monetary terms to the class, which included Edsaco's relinquishment of its right to appeal and plaintiffs' agreement to vacate the jury verdict.

Vitamins Price-Fixing Antitrust Litigation

For years, we have played a leading role representing plaintiffs in national antitrust class actions, including ones filed in California. In litigation against the world's largest vitamin manufacturers for allegedly crafting a global "vitamins cartel" that fixed the price of vitamins in the 1990s, we served a co-lead counsel responsible for prosecuting claims by California indirect purchasers of vitamins and products containing vitamins. In January 2002, the Court approved a $96 million settlement of the case.

2001

Toms River, New Jersey Childhood Cancer Concerns Case

With co-counsel, Lieff Cabraser represented 69 families in Toms River, New Jersey, each with a child having cancer, that claimed the cancers were caused by environmental contamination in the Toms River area. Commencing in 1998, the parties -- the 69 families, Ciba Specialty Chemicals, Union Carbide and United Water Resources, Inc., a water distributor in the area -- participated in an unique alternative dispute resolution process which lead to a fair and efficient consideration of the factual and scientific issues in the matter. In December 2001, under the supervision of a mediator, a confidential settlement favorable to the families was reached.

In re Lasik/PRK Antitrust Litigation

Lieff Cabraser served as a member of Plaintiffs’ Executive Committee in class actions brought on behalf of persons who underwent Lasik/PRK eye surgery. Plaintiffs alleged that defendants, the manufacturers of the laser system used for the laser vision correction surgery, manipulated fees charged to ophthalmologists and others who performed the surgery, and that the overcharges were passed onto consumers who paid for laser vision correction surgery. In December 2001, the Judge William J. Elfving approved a $12.5 million settlement of the litigation.

Providian Credit Card Class Action

Lieff Cabraser served as Co-Lead Counsel for a certified national settlement class of Providian credit cardholders who alleged that Providian had engaged in widespread misconduct by charging cardholders unlawful, excessive interest and late charges, and by promoting and selling to cardholders “add-on products” promising illusory benefits and services. On November 8, 2001, the Hon. Stuart R. Pollak granted final approval to a $105 million settlement of the case. In addition, the settlement required Providian to implement substantial changes in its business practices. Combined with an earlier settlement by Providian with Federal and state agencies, the $105 million settlement represents the largest settlement ever by a U.S. credit card company in a consumer protection case.

"Princeton Notes" Securities Fraud Litigation

In addition to representing shareholders in federal securities class action lawsuits, we have also represented large private and institutional investors in financial fraud lawsuits. A recent example of our efforts on behalf of private investors is our representation of two Japanese banks and a Japanese credit union in individual lawsuits against Martin A. Armstrong and HSBC, Inc., the successor-in-interest to Republic New York Corporation, Republic New York Bank and Republic New York Securities, for alleged violations of federal securities and racketeering laws.

Through a group of interconnected companies owned and controlled by Armstrong -- the Princeton Companies -- Armstrong and the Republic Companies promoted and sold promissory notes, known as the "Princeton Notes," to more than eighty of the largest companies and financial institutions in Japan. In December 2001, the claims of our clients and those of the other Princeton Note investors were settled. As part of the settlement, our clients recovered more than $50 million, which represented 100% of the value of their principal investments, less money they received in interest or other payments.

Network Associates Securities Class Action

Following a competitive bidding process Lieff Cabraser was appointed by the Court as lead counsel for the lead plaintiff and the proposed class of investors in a securities fraud class action against Network Associates, Inc. On May 21, 2001, the Court granted final approval to a settlement of the case. The company paid shareholders $30 million based on allegations that the vendor of security software had improperly accounted for acquisitions in order to inflate its stock price.

In approving the settlement, U.S. District Court Judge William H. Alsup observed, "Another factor is the expense and views of counsel here. We have class counsel who's one of the most foremost law firms in the country in both securities law and class actions. And they have a very excellent reputation for the conduct of these kinds of cases and their experience and views on whether it's worth the candle to go any further means a lot."

California Micro Devices Securities Litigation

Lieff Cabraser served as Liaison Counsel for the Colorado Public Employees Retirement Association and the California State Teachers Retirement Association, and the class they represented. Prior to 2001, the Court approved $19 million in settlements. On May 24, 2001, the Court approved an additional settlement of $12 million, which, combined with the earlier settlements, provided class members an almost complete return on their losses.

Commenting on Lieff Cabraser’s work in Cal Micro Devices, U.S. District Court Judge Vaughn R. Walker stated, "It is highly unusual for a class action in the securities area to recover anywhere close to the percentage of loss that has been recovered here, and counsel and the lead plaintiffs have done an admirable job in bringing about this most satisfactory conclusion of the litigation.”

Calistoga/Arrowhead Mountain Spring Water Class Action

Lieff Cabraser actively prosecutes cases on behalf of the public against corporations for alleged false advertising and deceptive marketing campaigns. On April 13, 2001, the San Francisco Superior Court entered final approval to a settlement with the producers of Calistoga and Arrowhead Mountain Spring Water. The plaintiffs alleged that the water did not comply with applicable Federal and State law definitions of "spring water" and was not from the geographic or geologic sources advertised. As part of the settlement, Defendants agreed to additional monitoring of the water used in all Calistoga and Arrowhead Mountain spring products, and to give discounts to California consumers in the amount of $1 million per year for five years.

Synthroid Marketing Litigation

Lieff Cabraser served as Co-Lead Counsel for the purchasers of the thyroid medication Synthroid in litigation against its manufacturer, Knoll Pharmaceutical. The lawsuits charged that Knoll misled physicians and patients into keeping patients on Synthroid despite knowing that less costly, but equally effective drugs, were available. In August 2000, U.S. District Court Judge Elaine E. Bucklo gave final approval to an $87.4 million settlement with Knoll and its parent company, BASF Corporation, on behalf of a class of all consumers who purchased Synthroid at any time from January 1, 1990 until October 21, 1999. In April 2001, the Court of Appeals in In re Synthroid Marketing Litig., 264 F.3d 712 (7th Cir. 2001), upheld the order approving the settlement and remanded the case for further proceedings.

LIEFF CABRASER HEIMANN & BERNSTEIN, LLP

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