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Lloyds Corporate Litigation Reporter

Lloyd's Corporate Litigation Reporter reports litigation news involving non-bankrupt public companies. It covers updates on pending and recently settled lawsuits -- including tax issues, insurance disputes, labor problems, shareholder suits, antitrust suits, product liability suits, toxic torts, personal injury suits, etc.

DaimlerChrysler AG, Genentech Inc., and Corning Inc. are the top three companies that face the largest claims for the Corporate Litigation Reporter publication period Jan. 1 to April 12, 2007.

Company Claim Amount Details
 1. DaimlerChrysler AG 
  Published April 11, 2007
US$4.74B DaimlerChrysler AG's subsidiary, DaimlerChrysler Financial Services AG, continues to face arbitration proceedings filed by the Federal Republic of Germany, which submitted its statement of claims in August 2005.

The Federal Republic of Germany is claiming lost revenues of EUR3.51 billion plus interest (EUR236 million through July 31, 2005 plus 5 percent per annum over the respective base rate since then) for the period Sept. 1, 2003, through Dec. 31, 2004.

The Federal Republic of Germany also claims contractual penalties of about EUR1.65 billion through July 31, 2005 plus interest, EUR107 million through July 31, 2005 plus five percent per annum over the respective base rate since then.
2. Genentech Inc. 
Published March 28, 2007
US$1.4B and US$4.1B Genentech Inc. says the final outcome of Dr. Kourosh Dastgheib's lawsuit against the Company relating to its Lucentis(R) product cannot be determined at this time because the plaintiff may still seek relief from the court of appeals.

Dr. Dastgheib has asserted multiple claims for monetary damages, including a claim under an unjust enrichment theory that he is entitled to the entire net present value of projected Lucentis sales, which he claims is between US$1.4 billion and US$4.1 billion.
3. Corning Inc. 
Published April 10, 2007
US$2.64B  Samsung Corning Precision Glass Co., Ltd., which is 50% owned by Corning Inc., and Samsung Corning Co. Ltd. are co-defendants in a lawsuit pending in the courts of Korea filed by Seoul Guarantee Insurance Co. and 14 other creditors. 

In the lawsuit, SGI and Creditors allege that, in the event that the proceeds of sale of the SLI shares is less than 2.45 trillion Korean won, approximately US$2.64 billion, the Samsung affiliates allegedly agreed to compensate SGI and Creditors for the shortfall, by other means, including Samsung affiliates' purchase of equity or subordinated debentures to be issued by SGI and Creditors. Any excess proceeds are to be distributed to the Samsung affiliates. 
4. Morgan Stanley 
Published March 9, 2007
US$1.578B  The District Court of Appeal for the Fourth District of Fla. on June 28, 2006 heard oral argument on Morgan Stanley's appeal of the Circuit Court of the 15th Judicial Circuit for Palm Beach County, Fla.'s final judgment issued on June 23, 2005 awarding US$1.578 billion to Coleman (Parent) Holdings Inc. (CPH).
5. Valassis Communications Inc. 
Published March 9, 2007
US$1.5B  Discovery on Valassis Communications Inc.'s monopoly lawsuit filed against News America Inc., News America Marketing FSI Inc. and News America Marketing In-Store Services Inc., commenced on Nov. 20, 2006, is underway. 

The complaint alleges damages in excess of US$1.5 billion, injunctive relief and costs for violation of the Sherman Act. 
6. Bristol-Myers Squibb Co. 
Published March 28, 2007
US$586M  Bristol-Myers Squibb Co.'s Nov. 13, 2006 motion to dismiss the complaint entitled RxUSA Wholesale, Inc. v. Alcon Labs., Inc., et al. is pending before the U.S. District Court for the Eastern District of New York.

Plaintiff claims that defendants allegedly engaged in anti-competitive acts that resulted in its exclusion from the relevant market and seeks US$586 million in damages before any trebling, and other relief.
7. Central Hudson Gas & Electric Corp. 
Published March 9, 2007
US$528M  Central Hudson Gas & Electric Corp. still faces eight separate lawsuits claiming US$528 million for damages filed by about 24 plaintiffs related to the Jan. 1, 2001 a fire that destroyed a multi-family residence on Taylor Avenue in Poughkeepsie, N.Y.

8. Pacific Gas and Electric Co. 
Published March 22, 2007
US$500M  The next case management conference for legal actions filed by the California Attorney General and the City and County of San Francisco against PG&E Corp. in the Superior Court for the County of San Francisco is scheduled for April 17, 2007.

The complaint seeks injunctive relief, the appointment of a receiver, restitution in an amount according to proof, civil penalties of US$2,500 against each defendant for each violation of Section 17200, a total penalty of not less than US$500 million and costs of suit, and restitution of assets allegedly wrongfully transferred to PG&E from the Utility.
9. International Speedway Corp. 
Published March 9, 2007
US$400M Discovery of expert opinion matters on the US$400 million antitrust lawsuit filed by Kentucky Speedway LLC against International Speedway Corp. and National Association for Stock Car Auto Racing is underway.
10. Ameron International Corp. 
Published Feb. 22, 2007
US$376M  Sable Offshore Energy Inc.'s damages claim against Ameron International Corp., two of its subsidiaries (Ameron (UK) Ltd. and Ameron B.V.), and other suppliers and contractors, remains in discovery and is still not set for trial. The claim is estimated to be about CDN428 million.
11. AMERIGROUP Corp. 
Published April 4, 2007
US$334M 
AMERIGROUP Corp. is set to appeal the US$334 million judgment against the Company in a qui tam lawsuit filed by Cleveland A. Tyson against AMERIGROUP Illinois, Inc. to the U.S. Court of Appeals for the 7th Circuit.
12. Corn Products International, Inc. 
Published April 10, 2007
US$325M  Corn Products International, Inc. said that it does not expect a decision by the North American Free Trade Agreement Tribunal on any of its damages claims against the United Mexican States for breach of NAFTA obligations soon, according to the Company's latest annual report filed with the U.S. Securities and Exchange Commission. 

In response to the imposition of the tax, the Company submitted on Oct. 21, 2003, an arbitration claim against the government of Mexico under the provisions of the NAFTA seeking recovery for US$325 million in damages.
13. Alcoa Inc. 
Published March 15, 2007
US$304M  Alcoa Aluminio S.A., a subsidiary of Alcoa Inc., continues to contest the BRL669 million claim by the Federal Revenue Department of Brazil for alleged non-anticipation of payment of annual Corporate Income (CI) and Social Contribution Taxes (SCT) used by the Company.

The claim seeks payment equivalent to about US$304 million and encompasses fiscal years from 2000 to 2005. 
14. Qwest Communications International Inc. 
Published Feb. 26, 2007
US$289M  Qwest Communications International Inc. faces a suit claiming damages for alleged misrepresentation of KPNQwest NV's financial and business condition filed in the District Court of Amsterdam, The Netherlands.
KPNQwest is the Company's European joint venture with Dutch firm Royal KPN NV.

Plaintiffs allege damages of about EUR219 million, or US$289 million based on the exchange rate on Dec. 31, 2006.
15. Constellation Energy Group Inc. 
Published April 5, 2007
US$175M The City of Tacoma's appeal of the dismissal of its suit for violation of Section 1 of the Sherman Act filed against over 60 companies, including Constellation Energy Group Inc.'s subsidiary, is still pending. The Company's subsidiary involved in this case is Constellation Energy Commodities Group Inc. 

The suit further alleges that the total amount of damages is unknown, but is estimated to exceed US$175 million. 
16. Black & Decker Corp. 
Published March 15, 2007
US$170M  Black & Decker Corp. could lose about US$170 million if the U.S. Internal Revenue Service prevails in its disallowance of the capital loss deduction and imposition of related interest on the tax adjustment dispute between the parties.
17. Ameron International Corp. 
Published Feb. 22, 2007
US$128M  Dominion Exploration and Production Inc.'s and Pioneer Natural Resources USA Inc.'s damages claim, estimated to be about US$128 million filed against Ameron International Corp., remains in discovery with no trial date established.
18. URS Corp. 
Published April 4, 2007
US$120M  URS Corp. Southern and URS Holdings, wholly owned subsidiaries of URS Corp., still contests suits filed by Tampa-Hillsborough County Expressway Authority alleging breach of contract and professional negligence related to a subsided pier.

In October 2005, the Authority filed a lawsuit in the 13th Judicial Circuit of Florida against URS Corp. Southern, URS Holdings and an unrelated third party, alleging breach of contract and negligence resulting in damages to the Authority exceeding US$120 million. 

19. Merrill Lynch & Co. Inc. 
Published April 3, 2007
US$115M  Allegheny Energy Inc.'s appeal of the decision rendered on July 18, 2005 by the U.S. District Court for the Southern District of New York requiring it to pay Merrill Lynch & Co. Inc. US$115 million plus interest is still pending.
20. Magyar Telekom Telecommunications Plc 
Published March 22, 2007
US$105M  T-Online Hungary Internet Service Provider Co. Ltd. is in the process of deleting three OrigoApro.hu Kft. trademarks from its registry.

OrigoApro.hu filed a lawsuit in May 2006 against T-Online Hungary for damages asserting claims based on its trademarks "origoingatlan," "origoapro" and "origoauto" potentially amounting to HUF19 billion

Bristol-Myers Squibb Co., DaimlerChrysler AG, and Time Warner Inc. are the top three companies which made and reserved the largest suit settlement amounts reported for the Corporate Litigation Reporter publication period Jan. 1 to April 12, 2007.

Company Claim Amount Details
1. Bristol-Myers Squibb Co.
Published March 28, 2007
US$499M  Bristol-Myers reserves US$499M in accordance to an agreement in principle entered into with the U.S. Department of Justice and the Office of the U.S. Attorney for the District of Massachusetts, subject to the approval of the DOJ, to settle several investigations on the Company's drug pricing, and sales and marketing activities.
2. DaimlerChrysler AG
Published April 11, 2007
 US$280M  DaimlerChrysler AG's subsidiary, DaimlerChrysler North America Holding Corp., is liable to pay a US$280 million award in punitive damages to MAN AG, after a jury trial in Multnomah County Circuit Court, Oregon in December 2006.
3. Time Warner Inc.
Published March 28, 2007
US$260M Time Warner, in February 2007, reached an agreement with the University of California to settle fraud suits related to the AOL-Historic TW Merger for US$260 million.
4. Time Warner Inc.
Published March 28, 2007
US$144M Time Warner, in March 2007, settled for US$144 million the suits alleging misrepresentations in registration statements related to the AOL-Historic TW Merger and stock option plans in violation of Sections 11 and 12 of the Securities Act of 1933 filed in Ohio, according to the Pensions&Investments news. 
5. Nexen Inc.
Published April 4, 2007
US$135M Nexen, in late 2006, agreed to settle the arbitration alleging breach Area of Mutual Interest agreement commenced by Occidental Petroleum Corp.'s subsidiary for US$135 million.
6. Time Warner Inc., 
Published March 28, 2007
US$50M Time Warner, in December 2006, reached an agreement with Alaska State Department of Revenue to settle suits alleging fraud related to the AOL-Historic TW Merger for US$50 million.
7. C.R. Bard Inc.
Published April 5, 2007
US$49M C.R. Bard Inc., in the fourth quarter of 2006, settled the damages suit filed by Rochester Medical Corp. Inc. in the U.S. District Court, Eastern District of Texas, entitled “Rochester Medical Corp. Inc. v. C. R. Bard, Inc., et al.” for US$49 million.
8. Bearingpoint Inc.
Published Jan. 25, 2007
US$36.9M  Bearingpoint made settlement payment of about US$36.9 million in September 2006 for the Allocco v. Gardner, Ariko v. Moores, Bains v. Moores and the Peregrine Litigation Trust civil lawsuits.
9. PPL Electric Utilities Corp.
Published March 9, 2007
 US$33M  PPL Electric Utilities Corp. is liable to pay US$33 million to Exelon Corp. according to a third settlement agreement, subject to approval by the Federal Energy Regulatory Commission, to clear the billing dispute commenced by Exelon Corp.
10. Waste Management Inc. 
Published March 15, 2007
 US$29M  Waste Management, in the fourth quarter of 2006, was ordered to pay about US$29 million to settle the claim filed by the purchaser of the Company's interest in a joint in Mexico in 2000.

Intel Corp., Synopsys Inc., and Cadence Design Systems Inc. are the top three companies facing the highest tax assessments, disallowances and claims by different tax agencies for the Corporate Litigation Reporter publication period Jan. 1 to April 12, 2007.

Company Claim Amount Details
1. Intel Corp.
Published March 29, 2007
US$2.2B Intel Corp.'s appeal of the Internal Revenue Service's Tax Assessment for the Company's tax returns for the years 1999 through 2005 regarding the amounts reflected on those returns as a tax benefit for its export sales is still pending.

The Company's federal income tax due for 1999 through 2005 could increase by about US$2.2 billion, plus interest. 
2. Synopsys Inc.  
Published Jan. 18, 2007
 US$476.8M On June 8, 2005, Synopsys Inc. received a Internal Revenue Service Agent's Report in which the IRS proposed to assess a net tax deficiency for fiscal years 2000 and 2001 of about US$476.8 million, plus interest.

Synopsys Inc. appeals the process of the proposed assessment of its net tax deficiency. 
3. Cadence Design Systems Inc.
Published March 28, 2007
US$318M  Cadence Design faces US$324 million proposed aggregate tax deficiency for the tax years 2000 through 2002 by the Internal Revenue Service. 

Cadence Design is seeking resolution of this tax deficiency issues through the Appeals Office of the IRS.

4. Bausch & Lomb Inc.
Published Feb. 15, 2007
US$200M  Bausch & Lomb Inc. could have increased tax liabilities for Wilmington Partners L.P. for the tax periods ended June 4, 1999 and Dec. 25, 1999 by more than US$200 million, plus penalties and interest. 

Bausch & Lomb continues to challenge the tax adjustments proposed by the Internal Revenue Service regarding the tax periods.
5. Wyeth
Published April 3, 2007
 US$134.8M Wyeth faces about US$134.8 million tax claims filed on July 26, 2002 by a Brazilian Federal Public Attorney against the federal government of Brazil, Wyeth and its subsidiary, Laboratorios Wyeth-Whitehall Ltda. on non-taxing of Kolynos divestiture.
6. The Mosaic Co.
Published Feb. 6, 2007
US$75.3M  The Mosaic Co. faces claims US%46.6 million taxes and US$28.7 million interest by the Florida Dept. of Revenue. FDOR continues its audit into the Company for unpaid sales and use taxes for the period beginning June 1, 1997 through May 31, 2002. 
7. Owens & Minor Inc.
Published April 4, 2007
 US$71.5M Owens & Minor Inc. has a pending appeal with the Internal Revenue Service related to the proposed disallowance of IRS on certain reductions in the Company's tax-basis last-in, first-out (LIFO) inventory valuation. 

If the Company were unsuccessful in its appeal, it would have to pay a deficiency of about US$71.5 million in federal, state, and local taxes for tax years 2001 through 2006 on which deferred taxes have been provided and calculated at statutory rates, of about US$9.5 million as of Dec. 31, 2006, net of any tax benefits.
8. Time Warner Inc. 
Published March 28, 2007
US$44M  AOL Europe Services SARL, a wholly owned subsidiary of Time Warner Inc.'s subsidiary, on Dec. 22, 2006, received an assessment from the French tax authorities for EUR34 million or about US$44 million for value added tax due in France.
9. Mueller Water Products Inc.
Published March 5, 2007
 US$80.4M  The Internal Revenue Service has issued a Notice of Proposed Deficiency assessing additional tax of US$80.4 million for the fiscal years ended May 31, 2000, Dec. 31, 2000, and Dec. 31, 2001 against Walter Industries Inc., the company from which Mueller Water spun off. 

Mueller Water reports that Walter Industries indicated that it intends to defend itself against the IRS claims.
10. Alliance One International Inc.
Published Feb. 23, 2007
US$27.2M

Alliance One faces an assessment that it had US$26.6 million in federal income taxes in 2005 that were offset by the excise taxes in Brazil. The Company continues its appeal on the assessment.

Information presented herein details the companies with the biggest settled, pending and tax claims as reported in the Lloyd's Corporate Litigation Reporter.   To get the news when it happens, as it happens, subscribe to Lloyd's Corporate Litigation Reporter here.