Two years after Judge John Galasso signed an Order of Liquidation and approved the Restructuring Agreement for Executive Life of New York (ELNY), separate (but nearly identical) class action lawsuits have been filed in Florida and Oregon on behalf of ELNY shortfall victims against named and unnamed structured settlement brokers.
The complaints allege these brokers violated state statutes and their alleged duty of care to ELNY shortfall victims whose structured settlements were funded with qualified assignments and who resided in states where ELNY was not licensed to sell insurance when their settlements were consummated.
The Florida case names EPS Settlement Group (EPS), John Cantwell and John Does 1-100 as defendants. The Oregon case names Ringler Associates Incorporated (Ringler), Paul Hoffman and John Does 1-100 as defendants. The respective complaints identify Cantwell and Hoffman as the individual agents who brokered structured settlement annuities for the named plaintiffs.
In each case, the John Does 1-100 "represent those individual insurance brokers who, as employees and/or agents of [the named brokerage company], its affiliates, or predecessor companies, brokered the sales of the SSAs at issue in this case, of which members of the proposed class were beneficiaries."
Each complaint further states "that with proper discovery into the matter these Defendants can be identified, and the complaint can be amended at a later date to include the individual names of these Defendants."
The complaints in both cases identify as plaintiff attorneys Taus, Cebulash & Landau and Berger & Montague. The Florida complaint also names Scott R. Shepherd and the Oregon complaint also names Arthur C. Johnson as plaintiff attorneys.
Each complaint identifies two causes of action:
- Negligence - failing to disclose facts about ELNY's deteriorating financial condition.
- State statutory violation - prohibiting persons from assisting unlicensed insurers transact business.
Although the negligence counts do not state specific amounts of damages, the statutory violation counts claim "Plaintiffs and Statutory Subclass members are entitled to damages for the fulI amount of their unpaid claims pursuant to the State Statutes."
As one state statutory example, the Oregon complaint cites Alaska Statute 2l -33.037:
- "A person may not directly or indirectly act as agent for, or otherwise represent, assist, or aid on behalf of another, a nonadmitted insurer in the transaction of insurance in this state.
- "If the nonadmitted insurer fails to pay a claim or loss within the provisions of the insurance contract, a person who assisted or in any manner aided directly or indirectly in the procurement of the insurance contract, shall be liable to the insured for the full amount under the provisions of the insurance contract."
The complaints allege that ELNY was never authorized to transact insurance in Alabama, Alaska, Arkansas, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Massachusetts, Minnesota, Missouri, Montana, New Mexico, North Carolina, Oklahoma, Oregon, South Carolina, South Dakota, Tennessee, Texas, Washington, Wisconsin, and Wyoming.
A prior and separate class action lawsuit filed in New York in 2012 by ELNY shortfall victims against Benjamin M. Lawsky, Superintendent of Financial Services of the State of New York, in his non-regulatory capacity as ELNY's Receiver, including predecessor ELNY Receivers (Rehabilitator), Metropolitan Life Insurance Company (MetLife) and Credit Suisse Group, AG (Credit Suisse) as defendants was voluntarily dismissed in 2013 without prejudice.
For S2KM's complete ELNY reporting, see the structured settlement wiki.