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BREACH OF CONTRACT La. state insurer pays $6.6M for Rita damages NEW ORLEANS (AP)-Louisiana’s state-run insurer has agreed to a mass settlement with more than 150 policyholders whose homes were damaged by Hurricane Rita. Private insurance companies already have reached individual settlements with hundreds of homeowners in Louisiana who sued in the wake of Katrina and Rita. Citizens Property Insurance Corp., Louisiana’s insurer of last resort, agreed to pay about $6.6 million to 167 policyholders in Cameron Parish who sued Citizens for refusing to cover damage from Rita in September 2005. Insurer’s denial of claim results in $10M award DES MOINES, IOWA (AP)-An Iowa federal jury has awarded a man $10 million in a back injury case, ruling that the insurance carrier for Kris Zimmer’s employer acted in bad faith in denying his claim for benefits from a 1999 back injury. Court records show that 47-year-old Zimmer worked as a computer technician for Norwest Financial when he injured his back bending over to pick up papers. Doctors diagnosed him in severe pain, but a lawsuit claimed that Travelers Insurance Co. denied his workers’ compensation claim. CONSUMER PROTECTION Suit over needless AIDS therapy settles for $24M MIAMI-A Miami lawyer has obtained a $24 million class action settlement with a Swiss drug maker that allegedly persuaded doctors to prescribe the expensive AIDS drug Serostim to patients who did not need it. In 2005, attorney Lance Harke of Harke & Clasby sued drugmaker Merck Serono S.A. on behalf of Miami Beach, Fla., AIDS patient Eugene Francis and an estimated 10,000 AIDS patients nationwide in a Massachusetts federal court. The suit came after the Justice Department had settled criminal and civil cases it had brought against Serono. In 2005, the company agreed to pay $704 million in fines for the unlawful promotion of Serostim, a recombinant human growth hormone used to treat AIDS wasting, or involuntary weight loss. -ALM FRAUD Time Warner pays Ohio $144M to settle suit COLUMBUS, OHIO (AP)-Ohio has reached a $144 million settlement with Time Warner Inc. over claims that public employees lost millions after the media conglomerate agreed in 2001 to be acquired by America Online Inc., the state’s attorney has general announced. The state sued in 2003 on behalf of five state pension funds and the Ohio Bureau of Workers’ Compensation. The groups claimed to have lost $400 million when Time Warner’s stock fell dramatically after the 2001 deal. The lawsuit accused AOL executives of fraudulently inflating the company’s advertising revenues and Internet subscriber counts, boosting AOL’s stock price. Ohio was one of 150 parties that opted out of an initial class action against the new AOL/Time Warner company to pursue separate claims. A New York judge approved a $2.65 billion class action settlement last year involving an estimated 600,000 claimants. Ohio would have ended up with only $9 million from that settlement. PATENTS Internet phone firm pays $58M for infringement ALEXANDRIA, VA. (AP)-A Virginia federal jury has ordered Internet phone company Vonage Holdings Corp. to pay Verizon Communications Inc. $58 million for infringing on three patents that enable Vonage’s low-cost telephone service. Verizon sued Vonage last year for infringing on five patents that it said Vonage uses to make its Internet telephone service network functional. The jury found Vonage infringed on three of the five patents-though not willfully. That means Verizon cannot collect triple damages. PRODUCTS LIABILITY Telecom operator gets $5M over service break MORRISVILLE, N.C. (AP)-Network switching and transmission equipment maker Tekelec said that it has signed a settlement agreement with French mobile telecom operator Bouygues Telecom to end a lawsuit that stemmed from a 2004 service interruption in Bouygues’ network. As part of the settlement, Tekelec will provide $5 million in credits to Bouygues, which it can apply to purchases of Tekelec products and services. REGULATORY ACTION Broadcasters pay $12.5M in anti-payola settlement WASHINGTON (AP)-Four major broadcast companies have tentatively agreed to pay the government $12.5 million and provide 8,400 half-hour segments of free air time for independent record labels and local artists in anti-payola settlements. The monetary settlement is part of a consent decree between the Federal Communications Commission and Clear Channel Communications Inc., CBS Radio, Entercom Communications Corp. and Citadel Broadcasting Corp. The agreement is aimed at curbing payola-the practice of radio stations accepting cash or other considerations from record companies in exchange for air play.

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