by Structured Settlement Watchdog
In bringing the structured settlement class action case against AIG (which was dismissed with prejudice in September 2018 and now on Appeal in the First Circuit), I previously opined that Plaintiffs” weakest argument has to do with undisclosed broker compensation and their choice of representative plaintiffs who were represented by sophisticated juggernaut law firms which makes their theory less credible.
The Mean Monkey Illusion
Despite overlooking anti-rebating laws, the plaintiffs in Ezell v. Lexington Insurance have selectively left out from their case certain major contributors to trial lawyer associations whose statements appear to weaken their arguments, allowing them to craft their so-called “mean monkey illusion.”
Fact: A review of plaintiff structured settlement brokers and settlement planners who contribute to state trial lawyer associations and AAJ, reveals many are silent on commissions on their websites.
Fact: A website for the Beirut Bombing lawsuit settlement fund reveals a copy of a June 2, 2016, letter to Maria T. Vullo of the New York Department of Financial Services, part of the efforts of one plaintiff firm to get a waiver or exception to reduce commissions, evidence of the awareness of the anti-rebating law. The anti-rebating laws kill the damages valuation.
Then there is this…
Here’s one from a plaintiff exclusive structured settlement expert whose statements peaks for itself
” Unlike many other investment vehicles and products, structured settlements do not charge management fees, commissions, or expenses”
Then there are these…
- “There are no costs to create a structured settlement to the plaintiff attorney or injured party. The insurance broker’s commission to arrange and purchase the structured settlement annuity is paid by the life insurance company”.
- One of the largest partners for justice with the New York State Trial Lawyers Association which includes structured settlements and attorney fees as part of its defined services states on its home page that these are “structured settlement services provided free of charge”, However the subject firm does provide an affidavit that does disclose the commissions.
- “We are paid directly by the life insurance company where the annuity is placed. Life insurance companies pay a 4% commission based on the amount that is put into the structured settlement. Normally, we are paid a portion of that commission percentage, usually 2%, while the remaining 2% goes to defense’s structured settlement broker. Ours is a one-time commission payment. Also, we will never bill you for our time when we help you with servicing your annuity in the future”.
Then there is this disclosure from the website of a firm that does both plaintiff and defense work…
“They earn a commission on the sale of the funding instruments used to fund the structured settlement*. This commission is built into the price of the annuity such that no fee is paid outright by either party. If the case fails to settle or settles without a structure, no fee is charged”
All of these quotes appeared on websites of structured settlement brokerage firms in the week of January 11, 2019.
My November 6, 2010 post How Does Structured Settlement Broker Get Paid? Who Pays It?
Structured Settlement Broker Affidavit Bronx County New York Download IA-21StructureBrokersAffidavit