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Lawsuit over Scripps' billing of uninsured a class action
Class Action News | 2007/06/29 13:50

A San Diego Superior Court judge has granted class-action status to a lawsuit accusing Scripps Health hospitals of charging exorbitant amounts to uninsured patients who often aren't able to pay the bills without risking financial ruin. AdvertisementThe suit alleges that uninsured Scripps patients pay as much as four times more than patients covered by Medicare or private insurance for the same procedures. Those who don't pay their bills are sometimes reported to collection agencies that use aggressive tactics to pursue payments and cause damage to patients' credit, say attorneys for plaintiff Phillip Franklin.
The suit seeks refunds for as many as 100,000 uninsured patients who allege they were overcharged by Scripps' five San Diego hospitals since 2002 – an amount that could top $100 million – and penalties, said Kelly Dermody, a plaintiff's attorney.

Scripps “strongly objects” to the accusations, company spokesman Don Stanziano said yesterday. “Scripps is proud of our service to the community.”

He said the class-action designation, made Wednesday by Judge Steven Denton, did not represent a decision on the appropriateness of the bills under scrutiny. The ruling allows the plaintiff's attorneys to represent all the uninsured patients who might have been affected by the hospitals' practices.

“What happened today was expected. It's part of the process,” Stanziano said.

The case is similar to other suits filed in recent years in California and other states alleging that nonprofit health care systems such as Scripps have failed to live up to their legal obligation to provide free care to the needy in exchange for a tax-exempt status.

In the most recent case in California, Catholic Healthcare West agreed to pay $423 million in refunds and bill reductions to hundreds of thousands of uninsured patients who received care at the nonprofit's 35 hospitals in California. The San Francisco-based health care system did not admit any wrongdoing.

The Scripps case was filed last year by Franklin, of Solana Beach, who was referred to a collection agency after failing to pay a $2,900 bill for a visit to the emergency room at Scripps Memorial Hospital Encinitas in October 2004. Franklin was unemployed at the time because of a work-related disability and couldn't pay the charges, Dermody said.

Franklin went to the hospital with severe kidney pain and was diagnosed with a kidney stone. He was given urine and blood tests, a CT scan and pain medication, according to the suit, and was referred to a urologist.

The hospital was unwilling to let Franklin pay his bill in installments, Dermody said. The bill collector that later pursued the charges filed a lawsuit against Franklin in January 2006.

The rates at which Scripps bills uninsured patients – known as chargemaster prices – were, on average, 412 percent above the rates the hospitals charge when caring for patients covered by Medicare, the federal government's health care program for people who are elderly or have disabilities, according to the suit.

Government and private health plans routinely negotiate discounts for hospital services by using the leverage of being able to direct large numbers of patients to health care providers.

A recent article in the journal Health Affairs found growing evidence that uninsured patients are being charged considerably more – often as much as two and a half times – for hospital services than those with insurance.

The trend is a dramatic reversal from conditions 50 years ago when the poor and uninsured were often charged the lowest prices for medical services, wrote article author Gerard Anderson, a professor of health policy and management at Johns Hopkins Bloomberg School of Public Health in Baltimore.

Stanziano said that Scripps already offers a number of options for uninsured patients who need help paying their bills, including extended payment plans and discounts for those making less than 350 percent of the federal poverty rate or $72,275 a year for a family of four.



Class-action lawsuit against DIA dismissed
Class Action News | 2007/06/26 13:55

Two former employees who claimed their illnesses were caused by mold and fungi exposure at Denver International Airport had their class-action claim dismissed by the Colorado Supreme Court. The two United Airlines employees - Terri Crandall and Joann Hubbard - claimed they experienced pneumonia, headaches, nausea, shortness of breath and bronchitis beginning in 1995 and suspected environmental contamination.

Colorado Supreme Court justices say the women didn't file their notice of claim with Denver within a 180-day time period required by law.

John Fognani, an attorney representing the women, says his clients were extremely disappointed. Chris Doering, an assistant Denver city attorney, says the city is pleased with the decision. Doering says the city has not found a major mold issue at the airport.



Class Action Filed Against Netlist, Inc.
Class Action News | 2007/06/25 17:32

A class action lawsuit has been filed in the United States District Court for the Central District of California on behalf of all persons who purchased or otherwise acquired the common stock of Netlist, Inc. ("Netlist" or the "Company") (NASDAQ: NLST) in connection with its November 30, 2006 Initial Public Offering ("IPO") through April 16, 2007, inclusive (the "Class Period").

The Complaint charges Netlist and certain of the Company's executive officers and directors with violations of federal securities laws. Among other things, plaintiff claims that defendants' material omissions and materially false and misleading statements concerning the Company's business, operations and prospects caused Netlist's stock price to become artificially inflated, inflicting damages on investors. Netlist is a designer and manufacturer of high-performance memory subsystems, which are sold to original equipment manufacturers in the server, high-performance computing, and communications markets. The Complaint alleges that defendants failed to disclose, among other things, that: (1) the Company was experiencing the effects of an over-supplied memory chip market, and demand for the Company's products had deteriorated substantially; (2) due to excessive inventory levels, the Company's two largest customers would be forced to slash their product orders to return to acceptable levels; (3) the Company's profit margins were quickly eroding in the memory chip market; (4) the Company lacked adequate internal controls; and (5) as a result of the foregoing, among other things, the Company's Registration Statement was false and misleading at all relevant times.

On April 16, 2007, Netlist shocked investors when it reported its first quarter 2007 preliminary financial results, which disclosed for the first time that its operating results would be dramatically lower than investors were led to believe, primarily due to an oversupplied dynamic random access memory market, which in turn affected the Company's product pricing and gross margins. Additionally, the Company revealed that it had experienced a lower than expected demand for high-end products from its largest customers, due to excess inventory which had also significantly reduced demand for the Company's products. As a result of this news, shares of the Company's stock declined more than 28 percent, or $1.68 per share, to close on April 17, 2007, at $4.29 per share, on unusually heavy trading volume.

If you are a member of the class, you may, no later than July 27, 2007, request that the Court appoint you as lead plaintiff of the class. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs can participate in important decisions which could affect the recovery for class members.

If you wish to discuss this action, or have any questions concerning this notice or your rights, please contact us, toll free, at (888) 529-4787 or by email at info.newcases@kmslaw.com.

Kirby McInerney & Squire, LLP has specialized in complex litigation, including securities class actions, for several decades. The firm has repeatedly demonstrated its expertise in this field, and has been recognized by various courts which have appointed the firm to major positions in consolidated and multi-district litigation. The firm's efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling hundreds of millions of dollars, and the firm's achievements and quality of service have been chronicled in numerous published decisions. More information about the firm, class actions in general, or about the role of the lead plaintiffs in a securities class action can be obtained through Kirby McInerney & Squire, LLP's website at http://www.kmslaw.com/.

Website: http://www.kmslaw.com/



Weil, Gotshal Files Class Action Against Puppy Dealer
Class Action News | 2007/06/20 17:39

The Humane Society of the United States and Weil, Gotshal & Manges have filed what they believe to be the first class action lawsuit against a U.S. puppy dealer, alleging that the company sold puppies with genetic defects and contagious parasitic infections and failed to reimburse customers for the sick animals or their medical problems.

Weil Gotshal, led by New York litigator Paul Ferrillo, filed the lawsuit on a pro bono basis on behalf of the Humane Society in Broward County Circuit Court against the south Florida-based Wizard of Claws. The lawsuit so far represents about 100 class members, said Jonathan Lovvorn, who heads up the Humane Society's litigation department. Each representative will have damages of $2,000 to $5,000, making the lawsuit worth hundreds of thousands of dollars, he said.

The sale of sick and dying puppies to customers who were unable to receive reimbursement for either the price of the sick dogs or veterinary treatments that sometimes cost thousands of dollars violated Florida animal and consumer protection laws, the Humane Society said. The lawsuit seeks unspecified compensatory damages and injunctive relief against the further sale of puppies by Wizard of Claws.

A Web site for Pembroke Pines, Fla.-based Wizard of Claws shows photos of various breeds of puppies for sale. All puppies are checked by a veterinarian and "all our attention goes to their well being," the site says. The company says it "backs up our puppies 100 percent." A Wizard of Claws representative declined comment and referred calls to owner James Anderson, who was not available.

Ferrillo, who was drawn to the case in part by his affection for his Jack Russell terrier, investigated the puppy dealer and brought the case with help from a team of about a dozen lawyers in Weil Gotshal's Miami and New York offices in addition to Humane Society attorneys.



3M Wins Ruling in Contamination Class-Action
Class Action News | 2007/06/20 12:31

In a victory for 3M Co., a judge ruled today that 67,700 residents of Washington County will not be considered as a a single group in a lawsuit against the company for damages allegedly suffered because of chemicals detected in their water.

The ruling The ruling by Washington County District Judge Mary Hannon denied class certification for the residents - which will greatly help 3M as it defends one of the biggest environmental lawsuits in state history.

"3M is pleased. The entire ruling is a victory," said company spokesman Bill Nelson.

Six county residents brought the lawsuit, which has been joined by another 1,000 people, according to the plaintiffs' lawyers.

Hannon's ruling means anyone wishing to sue the company for similar damages will have to do so in a separate legal action.

The chemicals detected in trace amounts are PFCs, or perfluorochemicals, made by 3M for such products as Teflon and Scotchgard stain repellant. They were legally disposed of by 3M in landfills in Washington County. In 2004, the chemicals were discovered in drinking water in Lake Elmo and Oakdale.

The discovery of a related chemical in drinking water in communities including Cottage Grove and Woodbury was announced in January.

Mega-doses of PFCs have caused cancer and other problems in rats. But state officials said they pose no short-term health risk to humans because they are in such minute amounts in the drinking water.

PFCs in water are measured in parts per billion - the equivalent of one second in 32 years. It is calculated that a Woodbury resident would have to drink 500,000 glasses of water a day to match the dose at which rats begin to show an effect. Longer-term studies of the effects of PFCs are under way.

The stakes in the case are potentially huge. If the case had gone to trial with the larger group certified as a class, no one could have predicted the amount of a potential settlement. But an Ohio case involving the same chemicals ended in 2005 with a settlement of $300 million.

In that case, the DuPont Company agreed to pay to remove chemicals from drinking water and monitor the health of water-drinking residents in the future. It did not pay for any alleged damages done to the water-drinkers.

Attorneys for the plaintiffs wouldn't comment Tuesday, but said in a written statement that their case would go forward without class certification.

But others suing 3M - or who may want to in the future - were disappointed.

"I think this is a setback," said Jon Archer, who noticed many neighborhood children with developmental disabilities when he lived in Oakdale.

He has blamed the water. "It shows you how big powerful attorneys manipulate the system," Archer said of today's ruling.

Mike Bradley, a Woodbury attorney with thyroid cancer, could have joined the lawsuit if the certification was allowed. Now, if he wants to sue 3M, he will have to take separate legal action.

"It's tremendously frustrating," said Bradley. "I am not sure what the judge was thinking. I am really concerned that corporate interests not be placed above families and children."



Cabot Settles Class Action Lawsuits
Class Action News | 2007/06/14 12:45

Specialty chemicals maker Cabot Corp. said Wednesday it agreed to settle the federal class action lawsuits pending against it that alleged it and other carbon black manufacturers violated antitrust laws in setting prices for carbon black sold in the United States.

In a filing with the Securities and Exchange Commission, Cabot said its share of the settlement cost is $10 million. Cabot also denied any wrongdoing of any kind, and said it "strongly believes that it has good defenses to these claims."

The company said it agreed to the settlement to avoid further expense, inconvenience, risk and the distraction of protracted litigation.

The settlement agreement is subject to court approval.

Boston-based Cabot said it will continue to defend the remaining antitrust lawsuits pending against it. There are suits pending in several state courts brought by purported classes of purchasers of carbon black, and a single federal case brought by a party that did not join the federal class action.




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