6 Worst Getaway Plans of the Week

May 2nd, 2011. By LucyC

Shoulda Gone with the Skinny Jeans…There’s a reason burglars wear tight-fitting clothing. A would-be convenience store robber in Florida was recently brought down by his own trousers. Talk about wardrobe malfunction.

Apparently he had just shoplifted two cases of beer from a convenience store in Lake Wales, FL, and was running across the parking lot when he tripped and fell-doing a face plant and losing his pants at the same time. Well, we all know how difficult it can be to find your feet in that type of a situation. But find his feet he did, and he eventually made it to his car, which, by the way, didn’t have a licence plate. As he took off in his clearly distinguishable Chevy Malibu, leaking cans of Bud Lite could be seen escaping from it. Talk about drama! Apparently the video of the crime is a bit of a hit with the Polk County Sheriff’s office. 

Out of the Frying Pan and into the Fire—the direct line of fire that is. This would-be bully couldn’t have had worse luck. A man in Joliet, IL, was fleeing the scene of a crime only to run straight into a police convention.

No kidding. The man was trying to escape police who were after him because his girlfriend claimed he had punched her. He fled, on foot, into a nearby park where some 30 Joliet police officers were attending a seminar on “being prepared for any situation.” 

You have to love the serendipity.

Take me to your Leader…err, Owner? Here’s another eerie tale of serendipity. A man in Lincoln, Nebraska was attempting to steal a one of a kind car stereo but didn’t make out so well. After he liberated the stereo from the rightful owner’s car, he went to a sound shop to buy equipment needed to install the stereo system in his own car.

But—you knew there had to be a “but.” But, the man who managed the store was the owner of the sound system. Bingo—you’re busted! 

This fellow was arrested for larceny—even though he returned the lawn mower. Go figure. 

Early Mother’s Day Gift? A resident of East Lyme, CT, allegedly stole a lawn mower from the local Read the rest of this entry »

Hot Potato Diet Drug Alli Up for Grabs, but Who’s Buying?

April 29th, 2011. By AbiK

On the heels of consumer watchdog group, Public Citizen, calling for a ban of diet drug Alli, we see that GlaxoSmithKline (GSK)—makers of well-known type 2 and last-resort diabetes drug, Avandia—has chosen to offload the once golden weight loss wonder.

Alli Sales Drop

Apparently, Alli is not so golden anymore. GSK just reported on their first quarter earnings for 2011, and Alli sales were not exactly stellar. Case in point, Alli sales in Europe were down £14 million in first quarter 2011 vs prior year. And in the US? That’s a bit more ambiguous, though GSK does report “The USA grew 1% to £241 million, with strong performances from Sensodyne, Tums, Poligrip, Biotene, and Breathe offsetting lower sales of alli and Aquafresh.” Translation: Alli pooped in the US (no pun intended, see below).

Ok, financials are one thing—but there’s more to the Alli story than declining sales. And it begs the question, why would Sanofi-Aventis—if rumors are true—be considering buying Alli from GSK?

Alli Safety Record

Let’s recall that Alli was only approved for sale in 2007. That’s not all that long ago. Then by April, 2009 Alli was the subject of conversation with the CDER Drug Safety Oversight Board—over concerns of an Alli link to possible severe liver injury.

In August, 2009 the FDA sent out its Early Communication to alert consumers that Alli was indeed under review for severe liver injury risk.

By May, 2010 the FDA announced a revised label for Alli (and Xenical) that would include a warning about “rare reports of sever liver injury”.

Fast forward to Public Citizen’s call for a ban on Alli this month—which draws attention to some digging consumer watchdog group did over at the FDA’s AERS database that found Alli to “have been associated with 47 cases of acute pancreatitis and 73 cases of kidney stones”.

And Those Other Alli Side Effects…

In addition to being linked to serious liver injury, Alli is not exactly a dieter’s dream. We covered Alli’s rather gross side effects in an earlier story—and since then it’s not hard to find Alli users online who apparently have no shame in sharing stories of “oily orange stuff” dripping down their legs. GSK themselves recommended wearing dark clothes or carry additional clothes in case of an accident.

Seriously—possible Alli side effects reportedly include fatty or oily stools, oily spotting, intestinal gas with discharge, an increased number of bowel movements, or poor bowel control.

So given Alli’s recent sales decline, the potential for more serious adverse events to occur while taking Alli, the outcry for a ban on Alli—and the fact that it’s really not a pleasant way to lose weight—why would anyone want to buy the Alli brand?

Well, regardless of whether it’s Sanofi-Aventis or someone else, I hope their business plans include cross-promotion with Depends and Subtle Butt…

Asbestos News Roundup: 4.29.11

April 29th, 2011. By LucyC

A roundup of recent asbestos-related news and information that you should be aware of. An ongoing list of asbestos hot spots from the Asbestos News Roundup archive appears on our asbestos map.

Asbestos Lawsuits

Charleston, WV: A couple from Clarksburg has filed an asbestos suit naming 56 companies as defendants. They allege that the defendants are responsible for Lendell C. Simmons being exposed to asbestos and his resulting diagnosis of lung cancer.

Mr. Simmons was diagnosed with lung cancer on February 21, according to the lawsuit. Simmons and his wife, Patricia, are alleging negligence, contaminated buildings, breach of expressed/implied warranty, strict liability, intentional tort, conspiracy, misrepresentations and post-sale duty to warn, on the part of the defendants.

The 56 companies named as defendants in the suit are: A.W. Chesterton Company; Allied Glove Corporation; Beazer East, Inc.; Bechtel Corporation; Brand Insulations, Inc.; Catalytic Construction Company; Certainteed Corporation; Crane Co.; Crown Cork & Seal USA, Inc.; Dow Chemical Company; Dravo Corporation; Eaton Corporation; Fairmont Supply Company; ETC Wright Company; Flowserve FSD Corporation; Flowserve US, Inc.; FMC Corporation; Foseco, Inc.; Foster Wheeler Energy Corporation; General Electric Company; George V. Hamilton, Inc.; Goulds Pumps; Grinnell Corporation; Henry Vogt Machine Company; Hercules, Inc.; Howden North America, Inc.; I.U. North America, Inc.; IMO Industries, Inc.; Industrial Holdings Corporation; Ingersoll-Rand Company; ITT Corporation; J.H. France Refractories Company; Lockheed Martin Corporation; McJunkin Corporation; Metropolitan Life Insurance Company; Nitro Industrial Coverings, Inc.; Oglebay Norton Company; Ohio Valley Insulating Company, Inc.; Owens-Illinois, Inc.; Premiere Refractories, Inc.; Rapid American Corporation; Riley Power, Inc.; Rockwell Automation, Inc.; Rust Constructors, Inc.; Rust Engineering & Construction, Inc.; Schneider Electric USA, Inc.; Sterling Fluid Systems (USA), LLC; Sundyne Corporation; Sutter Roofing & Metal Co. Inc.; Tasco Insulations, Inc.; the Gage Company; UB West Virginia, Inc.; Union Carbide Chemical & Plastics Company; United Engineers & Constructors and Washington Group international; Viacom, Inc.; and Vimasco Corporation. (WVRecord.com)

Asbestos Hot Spots

Knox County, TN: The Knox County board met this week to try and determine what to do about the courthouse, which contains asbestos in the floor tiles, linoleum, textured parts of the ceiling, the boiler breeching and mud joints.

According to report by KWQC-TV6, 25 random tests for asbestos were done throughout the Read the rest of this entry »

InSecurities: Securities Fraud Roundup 4.28.11

April 28th, 2011. By LucyC

Top Securities Fraud Stories

The securities fraud story that’s got the attention of most folks right now is the Erica P. John Fund v. Halliburton case—which the Supreme Court has been hearing oral arguments on this week. Not because any of us held any Halliburton stock—and not even because it’s related to Halliburton’s liability to asbestos-related lawsuits, though asbestos is a hot topic here at LawyersandSettlements.com. No, this one’s a biggie because it has to do with whether a plaintiff can only obtain class action certification by establishing a preponderance of the evidence that shows that a corporation’s correction of its false statements made its stock price tank thereby screwing its investors.

The Halliburton case is actually from way back in 2002. The plaintiff, Erica P. John Fund, claimed that at the time, Halliburton understated its liability exposure to asbestos-related lawsuits and overstated its revenues—then, came out later correcting those statements at which point Halliburton’s stock price declined. The question at the heart of the matter pertains to loss causation—i.e., the plaintiffs’ ability to link their losses to a particular statement made by the company. After the Halliburton case had initially been thrown out by a Texas federal court—meaning that the court found the plaintiffs did not show causation of loss—an appeals court upheld the decision. And here we are awaiting the Supreme Court’s decision which is sure to have a major impact either way on how securities cases are handled in the future.

So, be that as it may, the theme for this month’s InSecurities column is entitled “In violation of federal securities laws” and you’ll find the specific allegations—chapter and verse—below. So let’s get started with our first securities suit: Rosetta Stone…

Company:                    Rosetta Stone, Inc

Ticker:                         RST

Class Period:                Feb-25-10 to Mar-1-11

Date Filed:                   Mar-31-11

Lead Plaintiff Deadline:  May-30-11

Court:                          Eastern District of Virginia

Madoff Meter:

The Allegations:

Nothing like learning first hand, as Rosetta Stone is finding out. They got hit with a securities lawsuit at the end of March, alleging—everyone sing along—you know the words—”certain of its officers and directors violated federal securities laws.” Very nice. Nothing like a good harmony.

The class period is practically 12 months—from February 25, 2010 to March 1, 2011, inclusive (the “Class Period”). The specific allegations—from the top—are (i) that Rosetta Stone was facing intense competition for its products, including free competitive product offerings; (ii) that the free and lower priced competitive product offerings, not a temporary reduction in advertising, was having a material adverse effect on the Company’s Class Period revenues, particularly U.S. consumer revenues; (iii) that the favorable sales booking numbers Rosetta Stone reported during the Class Period was the result of key retail partners maintaining inventory of the Company’s products well above historic levels; and (iv) that Rosetta Stone’s reported sales bookings and revenues during the Class Period were the product of manipulation.

But of course, the truth comes home to roost eventually, and on February 28, Rosetta Stone announced fourth quarter revenue of $74.3 million, a 5% decrease from the prior year, net income on a GAAP basis of $5.0 million, a decrease of 60% from the 2009 fourth quarter. On this news, shares of Rosetta Stone fell $1.77 to $13.19 per share. Ker plunk. I think this gets a 3 Bernie rating on our trusty Madoff meter.

Next up: 1st Centennial Bancorp…

Company:                        1st Centennial Bancorp

Ticker:                             FECN

Class Period:                    Apr-13-06 to Jan-23-09

Date Filed:                       Apr-19-11

Lead Plaintiff Deadline:     Jun-18-11

Court: —

Madoff Meter:

The Allegations:

Weary investors in 1st Centennial Bancorp filed a securities class action on April 19, in hopes that they may get some of their hard earned dollars back from a less than stellar investment. As the class period runs from April 13, 2006 to January 23, 2009, there could be quite a line-up for payouts.

Here’s the nitty-gritty—during the Class Period, 1st Centennial was a bank holding company for the 1st Centennial Bank (the “Bank”). During that period, the bank misled investors and Read the rest of this entry »

Jimmy Stewart Plane Crash Movie too Close to Reality 60 Years Later

April 28th, 2011. By Hunter West

The grounding of a Southwest Airlines 737 earlier this month due to a five-foot tear in the upper fuselage while the plane was in the air reminded me of a favorite old movie starring James Stewart. 

‘No Highway in the Sky,’ a British disaster film made in 1951, follows the heroics and eccentricities of a professor and an expert in aviation who is commissioned to investigate the crash of a commercial airliner. Factoring in the age of the plane and the number of hours flown—not to mention the natural propensity of metal to weaken when under constant stress and subject to vibration—Stewart’s character theorizes that the plane crashed because the tail fell off due to metal fatigue. 

He proceeds to rig a life-sized experiment in his lab, subjecting the tail section of an actual aircraft to vibrations and various in-flight sources of stress in an effort to replicate the actual crash, and to test his theory. 

His colleagues think he is daft. But the movie—based on a novel—did contain some elements of truth. 

That was borne out in the comments of a former North Carolina State University prof and expert in materials science, who says cracks in the bodies of commercial airliners are normal, and can be expected. 

“It can happen with everyday things,” Charles Manning said in comments published April 4^th on WRAL.com. “Take a paper clip and bend it back and forth. It’s going to break,” Manning said.

 Of course, there are the engine vibrations—harkening back to that old Jimmy Stewart movie. But more precisely, Manning told WRAL that the act of pressurizing the cabin, allowing passengers and crew to breathe, stretches the metal skin in, and out with each pressurization. Over time, the metal wears down and cracks. 

Fatigue cracks are small, he said—barely perceptible with a microscope when they first occur. It’s when they become more severe and can be seen by the naked eye, that they can potentially become a problem and are then subject to regular inspections. 

Manning knows his stuff. For the past 30 years, he has headed Accident Reconstruction Analysis Inc., an engineering consulting firm that performs failure analysis and accident reconstruction. Before that, he was a materials science professor at North Carolina State, and he also headed NASA’s Langley Advanced Materials Research Program. He reminds travelers that planes are inspected regularly, and not to worry… 

Not to worry? 

Tell that to the frightened passengers on board the Southwest airliner when the five-foot gash blew open, suddenly de-pressurizing the plane. Yes, the aircraft landed safely and there was no loss of life or injury beyond sheer terror. However, the sudden de-pressurization of a cabin can serve as a vacuum, sucking anything out with the rapidly escaping air pressure—like papers, handbags…and if the breach happens to occur adjacent to a child who isn’t strapped in… 

Well, you know the rest. 

In the movie, Jimmy Stewart’s character forgot to provide for temperature in his calculations. The tail DID fall off in his lab, but a bit beyond when he said it would. Sadly, during the interim, he had caused damage to a similar plane on an attempt to prevent it from taking off (he was worried about the tail), and the daft professor was banished and dismissed as a crackpot. 

Until, that is, the tail in his lab experienced fatal metal fatigue, cracked, separated and crashed to the floor. 

Until, that is, the actual plane he tried to keep on the ground was repaired and sent up for a test flight without passengers. When it landed, the tail fell off… 

It was just a movie, right? 

Fact: Three years after the film’s release, there were two fatal crashes involving the world’s first passenger jet, the de Havilland Comet. Investigators determined that metal fatigue was the most likely cause of both accidents, although other sources point to a design flaw. No the tails didn’t fall off, but the fuselage gave way. 

That was in 1954. 

Then there was the infamous 1988 incident where cracks led to a massive breach in the roof and fuselage of an Aloha Airlines flight. Flight attendant C.B. Lansing was sucked out due to the rapid depressurization, and she fell to her death. 

Manning assures that the Federal Aviation Administration (FAA) keeps the airlines on a tight maintenance schedule, including the testing by manufacturers of aircraft in an effort to gauge when, and where metal is likely to experience fatigue. 

Did they miss something with the Southwest flight? 

“I think planes are maintained as well as you can, and if the FAA sees that people are not doing it, they get after them,” Manning said. 

That’s reassuring… 

Hey, how about this idea. Figure out the point when metal starts to experience fatigue—and replace the bloody plane. 

Oh, but that would be just too expensive, wouldn’t it? Planes cost millions of dollars. Fleets cost billions. We wouldn’t have an airline industry—it would not be economically viable. 

Thus to have an airline industry, it appears that planes are required to stay in service as long as they are well maintained. 

Complete with cracks. 

Yes, I acknowledge those who maintain flying is still safer than driving—especially with so many people abusing their smart phones and GPS devices—or looking at their computerized dashboards–while driving. 

That’s why I’m taking the train…