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Federal lawsuit filed over jail overcrowding
Headline News | 2008/04/30 14:45

Civil rights lawyer Jonathan Feinberg [firm profile] filed a lawsuit Monday on behalf of 11 inmates challenging the "unconstitutional conditions" in which inmates are currently being held at four Philadelphia jails. US District Judge R. Barclay Surrick of the Eastern District of Pennsylvania ruled last January that overcrowded Philadelphia jails violate inmates' constitutional rights and therefore require court monitoring. Surrick's ruling came in response to a lawsuit filed by Feinberg's partner, University of Pennsylvania law professor David Rudovsky, in 2006 and ordered the City to immediately rectify conditions including "the failure to provide beds and bedding, ... material for personal hygiene including soap, warm water, toothpaste, toothbrushes and shower facilities." Suffolk's temporary injunction expired several months ago, and the new lawsuit now seeks class certification on behalf of all Philadelphia inmates.

A similar lawsuit filed by Rudovsky 35 years ago resulted in court oversight of Philadelphia jails from 1971 to 2001.



Appeals court orders new credit card case trial
Headline News | 2008/04/28 14:41

A U.S. appeals court reinstated a class-action suit on Friday against a group of banks that force their credit card customers to use arbitration instead of the courts to settle disputes.

The credit cardholders "alleged that the banks (with other co-conspirators, including American Express (AXP.N) and Wells Fargo (WFC.N)) illegally colluded to force the cardholders to accept mandatory arbitration clauses in their cardholder agreements," according to the ruling by the 2nd U.S. Circuit Court of Appeals.

The cardholders argued that the banks had violated antitrust laws "by refusing to issue cards to individuals who did not agree to arbitration," according to the decision.

The cardholders want the court to stop the banks from compelling arbitration, prevent them from "continuing their alleged collusion" and invalidate the existing mandatory arbitration clauses.

A lower court judge sided with the banks, which include Bank of America Corp (BAC.N), Discover Financial Services (DFS.N), Capital One Bank (COF.N), JPMorgan Chase & Co (JPM.N) and Citigroup Inc (C.N), and dismissed the case, saying the cardholders lacked standing.

The panel of three appellate judges disagreed. "The cardholders have adequately alleged antitrust injuries," it said in its ruling.

Bank of America, Capital One and Discover declined to comment. The other banks did not immediately return calls seeking comment.

"We're quite happy with the decision," said Charles Goodwin, whose Philadelphia law firm represents the credit cardholders. The cardholders are a large class coming from Pennsylvania, New York, New Jersey and California, he added.

Other banks named in the lawsuit include units of HSBC (HSBA.L) and Washington Mutual Inc (WM.N).

Joe Ridout of the nationwide nonprofit group Consumer Action hailed the ruling, saying: "It's unfair for consumers to have to give up their legal and constitutional rights just to get a credit card."



Fed. judge declares 2nd mistrial in terror case
Headline News | 2008/04/17 15:12

US District Judge Joan A. Lenard Wednesday declared a second mistrial in a terrorism prosecution of six men charged with conspiring to bomb the Sears Tower in Chicago and the FBI headquarters in Miami after the jury was unable to reach a verdict after 13 days of deliberations. In December 2007 Lenard declared an initial mistrial when the jury was deadlocked after nine days of deliberations. A seventh man was acquitted in that proceeding.

The seven were indicted last year on charges of conspiring to provide material support to al Qaeda; conspiring to provide material support, training, and resources to terrorists; conspiring to maliciously damage and destroy by means of an explosive; and conspiring to levy war against the government of the United States. The indictment alleged that ringleader Narseal Batiste recruited the six other defendants to "organize and train for a mission to wage war against the United States government," and that they pledged an oath to al Qaeda in an attempt to secure financial and logistical backing. Lawyers for some of the men said that their clients were entrapped by an FBI informant posing as an al Qaeda operative. If the men had been convicted, they would have faced up to 70 years in prison.



Class Says Lifelock Has Troubling Bosses
Headline News | 2008/04/11 14:41
Lifelock misrepresents and deceptively advertises its "identity theft protection" service, for which it charges $110 a year, a class action claims in Middlesex County Court.

Plaintiffs claim Lifelong does not actually provide the services it offers, that its president Richard Davis dreamed up the idea "while sitting in a jail cell after having been arrested for failing to repay a $16,000 casino marker," and that Lifelock's Chief Marketing Officer and co-founder Robert Maynard is under a lifelong FTC injunction because of misleading infomercials he ran for his own "credit improvement company."

    The complaint adds, "Finally, and perhaps most disturbing ... Maynard himself had engaged in the very type of identity theft his company had set out to eliminate, but stealing his own father's identity."

    Plaintiffs say that whatever services Lifelock does provide its 900,000 subscribers are available elsewhere for free


Paxil Teen Suicide Case Trumped by Michigan Law
Headline News | 2008/04/01 14:53

The parents of a Michigan teenager who killed herself while on the antidepressant Paxil cannot sue the drug's manufacturer because a state law grants immunity to the maker of any drug approved by the Food and Drug Administration.

U.S. District Judge Paul L. Maloney of the Western District of Michigan said FDA approval of Paxil use by adults was enough to shield manufacturer SmithKline Beecham Corp., even though the agency never approved the drug's use by teens.


He therefore dismissed Nadine White and David B. McCullough's lawsuit against SKB over their 16-year-old daughter Moriah's 2001 suicide after taking Paxil for three months.

Michigan is the only state with a law providing drugmakers immunity from state tort suits if the FDA has certified their products as safe and effective. The only exceptions to the statute are for fraud on the FDA or bribery of an agency official.

In this case, White and McCullough filed a negligence and strict-liability suit against SKB in a Pennsylvania federal court because the company is located in that state.

The drugmaker won a change of venue to the Western District of Michigan because the plaintiffs are residents of that state. It then filed a motion to dismiss.

In their opposition to the motion the plaintiffs argued that their suit is a failure-to-warn case because SKB never warned doctors not to prescribe Paxil to teens or children and, in fact, conducted a secret campaign to promote such "off-label" use.

Moreover, since the company never applied to the FDA for marketing approval to prescribe the drug to teens and children, it cannot argue that it has immunity under the Michigan statute, they said.

Judge Maloney rejected that argument, saying the Michigan Legislature provided immunity to drug manufacturers for FDA-approved products and that it is uncontested that Paxil was approved by the agency for use in adults.

"The statute does not limit the protection to situations when the drug is used for approved purposes," he said. "Should the Legislature wish to limit the protection available to "off-label" uses of the drug, it may do so."



Hollinger settles civil fraud lawsuit with SEC for $21.3M
Headline News | 2008/03/27 16:09

Hollinger Inc., the Canadian holding company with an interest in former newspaper publisher Hollinger International has agreed to pay the US Securities and Exchange Commission (SEC) $21.3 million to settle claims that from 1999 to 2003 it violated securities law by failing to disclose to investors payments and other transactions that benefited the executives to the detriment of the company. The settlement stems from a lawsuit filed by the SEC in November 2004 against former Hollinger International chairman Conrad Black, former Hollinger president David Radler, and Hollinger Inc. Under the terms of the settlement, Hollinger Inc. has agreed to be permanently enjoined from committing future securities laws violations. The settlement must still be approved by US District Judge William T. Hart before it becomes final.

Radler was sentenced in December to 29 months in prison for one count of mail fraud, after pleading guilty and agreeing to serve as a witness against Black. Black was convicted in July of mail fraud and obstruction of justice and sentenced to 78 months in prison; he began serving his sentence earlier this month after a federal appeals court rejected his request to remain free on bail while his appeal is pending. Radler, Black and other Hollinger executives were prosecuted in the United States in connection to allegations that they diverted more than $80 million from Hollinger International, now Sun-Times Media Group, and its shareholders during the company's $2.1 billion sale of several hundred Canadian newspapers.



Supreme Court Allows Retiree Benefits With Medicare
Headline News | 2008/03/25 16:14

The Supreme Court on Monday let stand a federal policy that allows employers to reduce their health insurance expenses for retired workers once they turn 65 and qualify for Medicare.

The justices turned down an appeal by the 35-million-member AARP to undo a rule that essentially allows employers to treat retirees differently depending on their age.

The rules were put into place by the federal Equal Employment Opportunity Commission, with the support of labor unions and other groups. They worried that employers would greatly reduce or eliminate health benefits for millions of retirees if they could not take Medicare into account when structuring the health benefit packages they voluntarily provide their retired workers.

The EEOC rule makes clear that employers can spend more on retirees under 65 years of age than those over 65 without running afoul of age discrimination laws.

The EEOC said it proposed the rule in response to a decision in 2000 by the 3rd U.S. Circuit Court of Appeals in Philadelphia that held that the Age Discrimination in Employment Act requires employers to spend the same amount on health insurance benefits provided Medicare-eligible retirees as those received by younger retirees.

AARP said EEOC violated the intent of Congress when it proposed the rule. But the EEOC said the same age discrimination law allows it to carve out an exemption to preserve the long-standing practice that allows employers to coordinate benefits with Medicare.

The same appeals court upheld the EEOC policy last year



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