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Ex-MetMortgage chief, SEC settle
Securities | 2007/10/31 03:52

The Securities and Exchange Commission has reached a tentative settlement with the former chief executive of Metropolitan Mortgage & Securities and with a Bellingham-based developer over fraud allegations related to the Spokane investment company's collapse. The proposed settlement, filed Monday in federal court in Seattle, would require former Met CEO Paul Sandifur Jr. to pay more than $150,000 and barred from serving as an officer or director in any SEC-regulated company for five years.

David Syre, owner of Bellingham-based Trillium, would pay $50,000 to the SEC; his company would pay an additional $75,000. The defendants would be permanently barred from violating securities laws, and the SEC would end its civil case against them.

The deal must be approved by U.S. District Court Judge John Coughenour.

The company, caught in a tangle of increasingly complex financial transactions designed to make it appear profitable, collapsed in 2004, leaving investors with more than $600 million in worthless securities.

The SEC's complaint, originally filed in September 2005, detailed deals in which Met sold land to Trillium and other developers.

The agency charged that Met, either directly or through its subsidiaries, disguised the fact it had financed all or most of the purchase price of the deals, so that it could improperly book the paper profits immediately.

In 2002, shortly before the end of its fiscal year, Met sold two vacant parcels in Everett and Texas to a Trillium-controlled entity called Jeff Properties for nearly $24 million.

Met also loaned the buyer most of the money needed for the purchase, replacing passive assets with supposedly profitable loans that would strengthen the company's numbers at a time it sought to raise money from investors.

In separate cases, the SEC in March settled civil fraud charges against former Met executives Robert Ness and Thomas Masters, who agreed to pay fines.

Dan Sandy, a business associate of Met and Trillum, also agreed to pay a $50,000 penalty.



Judge Extends Microsoft Timeframe
Breaking Legal News | 2007/10/31 03:47
 federal judge in Washington, D.C., has extended the timeframe for considering several states' arguments for five additional years of oversight of Microsoft Corp.'s competitive practices, and the software maker's arguments against that extension.

On Tuesday, U.S. District Judge Colleen Kollar-Kotelly also extended parts of the consent decree — part of the 2002 antitrust settlement, which is set to expire Nov. 12 — to no later than Jan. 31, 2008, to allow time to consider the arguments made by both sides.

Two separate groups of states filed motions last week asking Kollar-Kotelly to monitor Microsoft through 2012.

In one court filing, the states of New York, Maryland, Louisiana and Florida said they were concerned that the oversight may not have "enough traction to enhance long-term competition" among makers of computer operating systems.

Kollar-Kotelly gave Microsoft until Nov. 6 to oppose the motions, a week longer than the original deadline.

The judge gave the U.S. government a Nov. 9 deadline to submit an amicus brief, and said the states must file additional responses by Nov. 16. She also canceled a status hearing that was slated for Nov. 6.

The antitrust settlement reached among Microsoft, the federal government and 17 states barred the software maker from certain anticompetitive behaviors and sought to keep it from using its operating system monopoly to quash competition in other types of software.



Suspect Pleads Guilty in Boys' Deaths
Criminal Law | 2007/10/31 02:51
A final suspect has pleaded guilty in the shooting deaths of two boys who police say were slain in a botched robbery.

Deandre Witherspoon, 24, pleaded guilty Monday to second-degree murder in the killings of Orlando Herron, 13, and Darren Johnson, 11. The two were found shot in the head inside their ransacked home in February.

Authorities have said the boys were the victims of a drug-related robbery of their older cousin, an admitted drug dealer who survived being shot at the home.

Witherspoon, the sixth and final suspect in the case, avoided a potential life sentence by agreeing to the plea. His trial was set to begin Tuesday.

He now faces 22 to 40 years when he is sentenced Nov. 12.

Separate juries earlier this month returned guilty verdicts against Sonya O'Neal, 38, and Robert Reed, 36. They face mandatory sentences of life in prison when they are sentenced Wednesday.

Prosecutors said Witherspoon hatched the plan to rob the boys' cousin of drugs and money, and O'Neal did the shooting. Three others have pleaded guilty.



Police investigate youtube court footage
Legal Business | 2007/10/31 02:50

Film footage apparently showing a man's teenage killers appearing in court has been posted on YouTube.

Earlier this month, Glasgow's High Court heard that three of the youths had boasted about the killing of William Smith, 21, in a clip that was reportedly posted on the video-sharing website.

Now, what appears to be more film of the youths taken during a hearing at the High Court, has also surfaced on the website.

The clip, called "Gorbals" which runs for two minutes and 44 seconds, appears to show the teenagers from behind, sitting in the dock with a judge working in the background.

They are made to stand up just before the video ends.

It has been posted by a webuser called "chrismccann1888", and has already had more than 120 views.

Mr Smith was attacked with wooden sticks and punched and kicked in Glasgow's Gorbals area on December 29 last year. He died several days later in the city's Southern General Hospital.

Jason McFadden, 19, George O'Connor, 18, Iain Stevenson, 19 and Alexander Harvey, 18, admitted the culpable homicide of William Smith, 21. They were jailed for eight years.

Whoever shot the film faces a potential contempt of court charge, for which the maximum sentence is two years in jail and an unlimited fine.



Penn Hills woman pleads guilty in Duquesne shooting
Breaking Legal News | 2007/10/31 01:51
A former Duquesne University student pleaded guilty Tuesday to charges that she helped her armed friends get into a school dance the night five basketball players were shot and wounded. Brittany Jones, 20, was sentenced Tuesday to two years of probation. A judge also ordered Jones to stay off the university's campus and away from anyone with a gun.

Jones' attorney, James Ecker, said his client could have been sentenced to years in prison if she had not reached a plea agreement.

"She's very happy, she's continuing going to church and she has a job," Ecker told The Associated Press. "She's very happy and her family's very happy."

Jones was the last of four defendants to plead guilty in the September 2006 shooting in which basketball players Sam Ashaolu, Shawn James, Kojo Mensah, Aaron Jackson and Stuard Baldonado were injured.

The gunman, William B. Holmes III, 19, was sentenced Friday to up to 40 years in prison. Another shooter, Derek Lee, 19, was sentenced Oct. 23 to up to 14 years in prison. The two shots fired by Lee did not hit anyone, authorities said.

Jones was a member of the group that sponsored the dance, and invited a group of friends, among them Holmes and Lee, to the on-campus party. She knew some of the men were armed and asked a doorman if people attending the dance were being frisked, which they were not, authorities said.

Another girl, Erica Sager, 19, who knew the two gunmen, flirted with the basketball players, sparking the fight between the two groups. Sager had pleaded no contest to a riot charge and was sentenced to probation.

Allegheny County Common Pleas Judge Lawrence O'Toole on Tuesday harshly criticized Jones for inviting the gunmen to the party. Jones burst into tears and apologized for her actions after O'Toole sarcastically told her she could have also chosen to hang out with gangsters Bonnie and Clyde if they were available.

Three of the players who were shot, James, Mensah and Jackson, have recovered and are expected to start this season. Ashaolu, who still has shrapnel lodged in his head, is back in school, but does not expect to return to the team until next season.

Baldonado has been suspended due to several arrests this year. It is unlikely he will to return to the university. In April, he sued Duquesne University, alleging it failed to provide adequate security at the dance.



Leading Attorney Pleads Guilty to Receiving Kickbacks
Attorneys in the News | 2007/10/30 12:13
William Lerach
William Lerach, the shareholder lawsuit lawyer who was once called the “most hated man in high tech,” pleaded guilty yesterday to a conspiracy charge for his role in an illegal scheme to pay people to become plaintiffs in shareholder complaints.

Lerach, 61, of San Diego became the eighth person to plead guilty in connection with a seven-year investigation into the conduct of his former law firm, Milberg Weiss, prosecutors said.

Flanked by his lawyers, Lerach stood in court with his left elbow propped up on a lectern. He answered questions from U.S. District Judge John Walter in a firm voice.

“Guilty, your honor,” Lerach said when Walter asked how he would plead.

A sentencing hearing was set for Jan. 14. Under terms of the plea agreement Lerach struck with prosecutors last month, he faces a sentence of one to two years in prison. But Walter does not have to follow the agreement's terms.

Lerach also agreed to forfeit $7.75 million to the government and pay a $250,000 fine.

Walter told Lerach that he could lose his law license. The lawyer said he understood.

As the hearing broke up, Lerach walked over to the three federal prosecutors in the Milberg Weiss investigation and shook their hands. He shared a laugh with Assistant U.S. Attorney Robert McGahan.

Outside of court, Lerach's lawyer John Keker said he had no comment.

The New York-based Milberg Weiss firm, its co-founder Melvyn Weiss and Palm Springs lawyer Paul Selzer face trial next year in connection with the probe. The firm and Weiss have pleaded not guilty. Selzer's lawyer and prosecutors have said they are trying to reach a plea agreement.

Lerach is the third of three former Milberg Weiss partners to plead guilty in the investigation. David Bershad and Steven Schulman entered their pleas earlier this year and are cooperating with prosecutors.

Under terms of Lerach's plea agreement, he is not required to cooperate.

Lerach joined Milberg Weiss in 1976 and headed its West Coast operation. In 2004, he quit and started his own practice. Just before striking his deal with prosecutors, Lerach announced his retirement from the firm now known as Coughlin Stoia Geller Rudman & Robbins. Prosecutors agreed they would not charge Coughlin Stoia in the Milberg Weiss probe under terms of the plea deal.

Over the past two decades, Lerach has gained notoriety for filing class-action lawsuits against companies that saw their stock prices plummet. In the 1990s, such fraud lawsuits often involved high-tech companies.

Prosecutors contend that in some cases Milberg Weiss gamed the judicial system to its benefit.

The charges contend that Weiss and others helped steer secret payments to people who agreed to serve as plaintiffs in class-action lawsuits. Across the country, the firm had a string of these paid clients at the ready, which allowed Milberg Weiss to be the first to file class-action lawsuits. By being first, Milberg stood a good chance of receiving the lion's share of attorney fees when the cases were resolved.

Under the law, the lead plaintiff in a class-action shareholder suit must serve as a representative of the class and cannot have a special interest or hidden inducement beyond other shareholders in the case.

Prosecutors said Lerach and others, by participating in the secret payment scheme, betrayed their fiduciary duties of loyalty, honesty and trust to their other clients. If the secret payments had been uncovered, prosecutors said, judges overseeing the cases could have disqualified the law firm from serving in the case.

Lerach acknowledged making secret payments to plaintiff Steven Cooperman, 64, and stated that other plaintiffs received payments from other Milberg Weiss partners, typically 10 percent of the fees the firm received.

Lerach and his family have contributed heavily to political campaigns in the past two decades. He once hosted a fundraising event for former President Clinton at Lerach's Rancho Santa Fe home.

Among the current pack of presidential candidates, Lerach has contributed to Democratic presidential contender John Edwards' campaign. But officials with the former U.S. senator have said they gave the $4,600 donation to charity after Lerach's plea agreement became public.


Hexcel Pays US $15M for Defective Bullet-Proof Vests
Breaking Legal News | 2007/10/30 12:03
Hexcel Corporation of Stamford, Conn., has agreed to pay the United States $15 million to resolve allegations it violated the False Claims Act in connection with its role in the manufacture and sale of defective Zylon bullet-proof vests to federal, state, local and tribal law enforcement agencies, the Justice Department announced today. As part of the agreement with the government, the manufacturer has pledged their cooperation in the government’s on-going investigation of other participants involved in the fraudulent conduct.

The United States alleges that Hexcel wove Zylon fiber supplied by Toyobo Corporation into ballistic fabric used in bullet-proof vests sold by Second Chance Body Armor; DHB Inc. and its subsidiaries, Point Blank Body Armor and Protective Apparel Corp. of America; Armor Holdings and its subsidiaries, American Body Armor and Safariland; and Gator Hawk Armor. These vests were purchased by the United States directly and by various state, local and tribal law enforcement agencies, who were reimbursed with federal funds.

The United States alleged that Hexcel knew the Zylon manufactured by Toyobo was defective and degraded quickly when exposed to heat, light, and humidity. Additionally, the government alleged the company knew Toyobo provided Hexcel with “Red Thread” Zylon, which was weaker than standard Zylon.

“These defective vests were worn by federal officers, who side by side with the Department of Justice, enforce the laws of this nation, and by state, local and tribal officers, who are on the streets every day, contributing to a safer America,” said Peter D. Keisler, Assistant Attorney General for the Civil Division and Acting Attorney General. “We will never tolerate fraud that places our first responders at risk.”

In July 2005, the Justice Department filed a complaint against Second Chance Body Armor and the Toyobo Company, seeking to recover damages relating to the sale of defective Zylon bulletproof vests to the United States. In June of this year, the government filed a lawsuit against Toyobo Co. Ltd. of Japan and its American subsidiary, Toyobo America Inc., for their roles in the manufacture and sale of defective Zylon bullet-proof vests to U.S., state, local and tribal law enforcement agencies.


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Class action or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued. This form of collective lawsuit originated in the United States and is still predominantly a U.S. phenomenon, at least the U.S. variant of it. In the United States federal courts, class actions are governed by Federal Rules of Civil Procedure Rule. Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions. Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions. They can construct your law firm a brand new website, lawyer website templates and help you redesign your existing law firm site to secure your place in the internet.
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