Suits California

A Los Angeles judge Friday rejected pleas from the Aetna company that she invalidate Insurance Commissioner Roxani Gillespie's Oct. 2 order freezing auto insurance rate increases, and instead strongly supported the freeze. Declaring that "at some point the consumers in this state have to have some protection," Superior Court Judge Miriam A. Vogel said she is satisfied that Gillespie "has the power" under what the judge termed "an emergency situation" to hold up all rate increases.

State officials are neglecting their legal obligation to ensure that students who are learning English are receiving an adequate and equal education, according to a lawsuit filed Wednesday by the ACLU of Southern California and other advocates. The focus of the litigation is a small school system near Fresno, but the legal implications are broader: The suit accuses the state of poor oversight and says it must, by law, act to make sure these students are keeping pace academically with their peers across California.

Insurance Commissioner Roxani Gillespie, concerned that scores of insurance companies are trying to use an ambiguous decision two weeks ago by a Los Angeles judge to circumvent her freeze on auto insurance rate increases, will go back into court today to try to get the decision clarified and the freeze strengthened. Gillespie announced Thursday that she will challenge the Aetna insurance company's attempt to implement a 9.

The Federal Trade Commission filed a lawsuit accusing several California auto loan modification operations of deceiving consumers with false promises and then leaving their cars to be repossessed. The agency alleged that Hope for Car Owners in Folsom and Kore Services in San Diego charged clients hundreds of dollars in up-front fees for help obtaining car loan modifications, but then did nothing and refused to provide the full refunds they had advertised. The FTC also said it filed suit against individual participants Patrick Freeman from Hope and Michael Kamfiroozie and Naythem J. Nafso of Kore, which conducted business as Auto Debt Consulting.

Like most of California's big auto insurers, 20th Century Industries Inc. is continuing its legal fight against having to pay customer rebates under Proposition 103, the insurance-reform measure. In 20th Century's case, Insurance Commissioner John Garamendi has ordered the company to pay rebates totaling $106.5 million. So what happens to the $106.5 million while 20th Century argues its case? It's not sitting in a shoe box at 20th Century's Woodland Hills headquarters marked "Prop. 103 refunds."

A leading critic of California's vehicle Smog Check program filed a federal lawsuit Friday to force the state to clean up its air under the threat of hundreds of millions of dollars worth of sanctions by the Environmental Protection Agency. Sen. Tom Hayden (D-Santa Monica), who opposes California's decade-old system of allowing smog inspections at service stations and repair shops, filed the suit against EPA and state officials.

Los Angeles-based American Funds and six other mutual fund companies paid a total of $82.4 million to brokerage Edward Jones & Co. for selling their products through the first 11 months of last year, according to records disclosed Thursday. The extremely unusual disclosure was demanded by the Securities and Exchange Commission and other federal regulators, who said the St. Louis-based brokerage failed to tell customers that the funds on its "preferred list" paid millions of dollars to be there.

A Southern California surgery center charged teacher Lynne Nielsen $87,500 for a routine, 20-minute knee operation that normally costs about $3,000. Despite the huge markup, the Long Beach Unified School District and its insurer, Blue Shield of California, paid virtually all of the bill from Advanced Surgical Partners in Costa Mesa. Blue Shield mailed the $84,800 check to the high school Spanish teacher last month and told her to sign it over to the surgery center. Nielsen said she was outraged and refused to send the check.

The Federal Trade Commission filed a lawsuit accusing several California auto loan modification operations of deceiving consumers with false promises and then leaving their cars to be repossessed. The agency alleged that Hope for Car Owners in Folsom and Kore Services in San Diego charged clients hundreds of dollars in up-front fees for help obtaining car loan modifications, but then did nothing and refused to provide the full refunds they had advertised. The FTC also said it filed suit against individual participants Patrick Freeman from Hope and Michael Kamfiroozie and Naythem J. Nafso of Kore, which conducted business as Auto Debt Consulting.

Lawyers for women who originally sued Wal-Mart Stores Inc. for sex discrimination on behalf of 1 million co-workers nationwide have amended the lawsuit, limiting it to gender-bias claims by California workers. The filing comes four months after the U.S. Supreme Court in June barred the case as a class action covering all U.S. stores, saying the women failed to prove that the world's largest retailer had a nationwide policy that led to gender discrimination. The Supreme Court sent the suit back to federal court in San Francisco, where it was first filed in 2001.

California Atty. Gen. Kamala Harris told a judge she is entitled to pursue a lawsuit against the estate of a former Bernard Madoff investor for allegedly violating state laws, and the court should bar interference in the "people's action" by the Madoff trustee. Harris, who has a state enforcement proceeding against the estate of Stanley Chais, made the statements in a Bankruptcy Court filing in Manhattan in response to a lawsuit by trustee Irving Picard, who said he alone has the right to claw back money stolen from Madoff customers.

Lawyers for women who originally sued Wal-Mart Stores Inc. for sex discrimination on behalf of 1 million co-workers nationwide have amended the lawsuit, limiting it to gender-bias claims by California workers. The filing comes four months after the U.S. Supreme Court in June barred the case as a class action covering all U.S. stores, saying the women failed to prove that the world's largest retailer had a nationwide policy that led to gender discrimination. The Supreme Court sent the suit back to federal court in San Francisco, where it was first filed in 2001.

Quest Diagnostics Inc., the biggest provider of medical lab services in California, has agreed to pay $241 million to settle a whistle-blower's lawsuit that accused it of overcharging the state Medi-Cal program. The lawsuit also alleged that the Madison, N.J., company paid illegal kickbacks to doctors, hospitals and clinics that sent patients their way. The settlement was the largest in the history of California's False Claims Act, which allows private citizens to sue on behalf of the state if they have evidence that a government contractor has defrauded a state agency.

Countrywide Financial Corp., which faltered earlier this year under the weight of soured mortgages, made a practice of doling out bonuses to employees who sold risky loans, California officials alleged in an amended lawsuit Thursday. The allegations expand charges made in a suit filed by Atty. Gen. Jerry Brown against Countrywide and several of its top executives in June.

The California Supreme Court made it possible Thursday for people who become ill from smoking to once again win large judgments from tobacco companies, unanimously rejecting a four-year-old federal court decision that had virtually halted all smoker lawsuits in the state. "It reopens tobacco litigation in California," said Northeastern University Law Professor Richard A. Daynard, who heads a group that promotes lawsuits against the industry. "The light just went from red to green."

A federal judge has temporarily blocked California from moving ahead with plans to introduce advanced technology cars, throwing the state's electric vehicle program into turmoil at the moment auto makers are poised to mass produce the cleaner machines. While the U.S. district court decision leaves intact the state's zero emissions vehicle mandate, it sets aside key amendments that air quality officials approved last year.

UST Inc., the maker of Copenhagen and Skoal snuff, said it has agreed to settle a lawsuit against California over a state tax increase. Under the settlement, California, which in June increased the excise tax on smokeless tobacco to 150%, agreed to return the tax to 52.65%, UST said. The largest producer of smokeless tobacco sued in August, claiming the tax increase was unfair.

Mission Power Engineering, the Irvine construction and engineering subsidiary of the parent company of Southern California Edison, has scrubbed settlement talks and resumed its $70-million fraud suit against California Energy Co. The dispute revolves around Mission Power's involvement in building eight geothermal power plants as part of a $310-million project for San Francisco-based California Energy in the Coso and China Lake areas of Inyo County.

WorldCom Inc. will pay $8.5million to settle a lawsuit by California that claims the long-distance phone company used deceptive business practices to gain customers. State Judge Alfred Chiantelli in San Francisco approved the settlement Thursday, allowing the state to receive $8.5 million in penalties and reimbursements to pay for its investigation. Atty. Gen.

UST Inc., the maker of Copenhagen and Skoal snuff, said it has agreed to settle a lawsuit against California over a state tax increase. Under the settlement, California, which in June increased the excise tax on smokeless tobacco to 150%, agreed to return the tax to 52.65%, UST said. The largest producer of smokeless tobacco sued in August, claiming the tax increase was unfair.