A suit was filed against Peachtree and J.G. Wentworth alleging a lack of compliance with the state structured settlement protection acts (SSPA) in thousands of deals that they did. The parties are challenging the assets which were placed in their securitization, among other key matters raised in the pleadings.
The counter suit filed March 27, 2012 in Harris County Texas, by RSL Funding, LLC names the following counter defendants:
- Settlement Funding, LLC, a Florida LLC
- Peachtree Settlement Funding, LLC, a Nevada LLC
- J.G. Wentworth SSC. a Nevada LP
- JGWPT, a Delaware LLP and its CEO David Miller, individually
- JLL Partners, a Delaware Corp (and parent of JGWPT)
The counter suit alleges "that JGWPT and entities controlled by it, have been and continue to be engaged in operations that violate the SSPAs by offering enticements, bribes and improper gratuities to potential sellers of structured settlement payment rights without disclosing the existence of these enticements and gratuities to the courts that are assigned to approve the transactions". RSL Funding further suggests that "such should lead to the reconsideration of the $7 billion in claimed SSPAs done by some of the counter-defendants and their predecessors which are void ab initio on account of false disclosures provided to the courts".
The counter suit also lends support to our allegation in this blog that "court sniffing" goes on and that factoring companies use Court records to target potential sellersof stuctured settlement payment righta. In the counter-suit, RSl alleges that JGWPT et al. redact the contact information to block out competitors.
This lawsuit deserves to be followed closely by legislators as support for our call for marketplace standards in an under-regulated industry.
For more information see Evelyn E. Franklin, Simie Bernard King, Settlement Funding, LLC and Peachtree Settlement Funding, LLC v Rapid Settlements, Ltd, Rapid Management Corp, RSL Funding, LLC and Stewart A. Feldman v Settlement Funding, LLC et al. District Courty Harris County TX 113th JD Cause 2006-23366
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