Investors in fallen fund face tough court test

September 23, 2008

Litigation is mounting after Reserve Management Co., a firm that pioneered the money-market mutual fund nearly four decades ago, became the first ever to expose retail clients to losses by “breaking the buck.” It was among a handful of funds that earned that dubious distinction last week — a first since 1994.

Though money funds are generally viewed to be nearly as safe as cash, plaintiffs can’t expect to recover losses just because fund managers allowed assets to fall below $1 for each dollar put in.

Investment accounts are subject to losses and money-market funds are no exception. Investors looking for legal recourse may have a tough road ahead. To win in court or recoup losses through any action by regulators, investors likely will have to show misconduct on the part of a fund’s managers, such as favoring certain clients over others, or making riskier investments than were allowed under the fund’s criteria, legal observers say.

Read Article Yahoo News

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Blue Bell firm in age-bias lawsuit

It’s probably not a good idea - even as a joke - to ask a human resources person applying for a job the age question.

Asking about age is illegal because age discrimination is illegal, under federal law.
Now a Blue Bell communications company, which employs 5,000 technicians nationwide, is being sued because its major investor allegedly posed this question to a 55-year-old job candidate for the position of human resources director:
“How old are you, 78?”

Accusing Unitek USA L.L.C. of age discrimination, the U.S. Equal Employment Opportunity Commission yesterday sued the company in federal court in Philadelphia.
Unitek takes the allegations seriously, said the company’s attorney, Colin Dougherty.
“Certainly it feels it has done nothing wrong in this case and looks forward to vindicating its position through litigation,” he said.

According to the suit, Frank Bruno, of Audubon, Montgomery County, had aced interviews with Unitek’s top management, who all but assured him he had the job. He only needed one final interview with Joseph Kestenbaum, Unitek’s major investor, the suit says. Kestenbaum is not a defendant in the suit.

Read Article Philadelphia Inquirer

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Court OK’s $14.9 million award in well explosion

A jury’s award of $14.9 million to the family of a man killed in a fiery explosion after he backed his vehicle into a gas well near Farmington was upheld Monday by the state Court of Appeals.

The court rejected arguments by Energen Resources Corp. that the jury’s award was excessive and therefore unconstitutional.

The Santa Fe jury determined after a six-day trial in 2006 that the oil and gas company was negligent and its conduct reckless in the death of John Everett Stapleton, 19.
Stapleton died on July 21, 2002, in an area popular with young people and off-road enthusiasts when he backed his car into an unfenced, unprotected natural gas wellhead. The wellhead exploded, and he burned to death.

His family was awarded $1.92 million in compensatory damages and $13 million in punitive damages.

Read Article Las Cruces Sun News

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Agricultural investigations

Although not directly related to Phoenix, I figured with a heavy agricultural sector in Arizona, this could be interesting news. Some industries are under investigation. Check out the lawinfo.com article:

“Tomato processing, egg products industries probed”
The Associated Press, WASHINGTON

A federal investigation into possible food price-fixing has been expanded to include two major industries, tomato processing and egg products.

The Justice Department confirmed Tuesday that prosecutors are conducting separate inquiries into whether the tomato and egg industries engaged in anticompetitive practices.

Federal prosecutors also have been looking at possible price-fixing in the citrus industry for at least a year.

Read Full Article Lawinfo

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Speed Camera Challenge

The lawsuits finally came against those speed cameras they have all over the Valley and the state. The local governments in the state will likely gather some serious legal ammo for this case, because of the obvious revenue it generates. I have heard that some places around the country are actually getting rid of the cameras, because people stopped speeding, but the government isn’t making money. AZ Business Gazette on AZ Central has the story:

“Lawsuit questions legality of speed cameras”
by Howard Fischer - Sept. 18, 2008 12:00 AM
Capitol Media Services

Thousands of Arizona motorists might be able to ignore their photo-enforcement tickets if a new lawsuit is successful - and people who already paid fines based on the roadside cameras may be able to get their money back.

Legal papers filed in Maricopa County Superior Court contend that some of the speed violations recorded by Redflex Traffic Systems before the first week in August are illegal. That is because the company, which operates speed-enforcement cameras for the Department of Public Safety and several Arizona municipalities, was operating radar guns that had not been cleared for use in the United States.

The case when James Tavernetti filed suit claiming that he is not legally bound to pay a ticket issued by the Town of Paradise Valley in June after a mobile photo-radar unit operated by Redflex clocked him speeding.

Read Full Article AZ Business Gazette

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