Reservation Deadline for September MPC Meeting Extended
The deadline to make hotel reservations for the September MPC meeting in Edina, Minnesota, has been extended to Monday, August 17. After that date, NOLHGA cannot guarantee room availability or the NOLHGA room rate of $129/night plus tax.
To make online reservations at the Westin Edina Galleria, please visit the meeting Web page. The page also features a preliminary schedule of events as well as online registration and other meeting information.
Please note that the first two days of the meeting (September 1 and 2) consist primarily of task force meetings. Guaranty association administrators from affected states are encouraged to attend these meetings if they wish. Task force presentations during the MPC will be limited to those insolvencies for which the task force is recommending MPC action be taken. Status reports for task forces meeting in Minnesota and any other task forces that wish to provide updates will be distributed after the meeting.
If you have any trouble accessing the meeting Web page, please contact Dan Hicks at [email protected] or 703.787.4112. If you have any questions about the meeting, contact Sean McKenna at [email protected] or 703.787.4106.
Staff Contact - Sean McKenna Lincoln Memorial & Memorial Service Life Insurance Companies (Texas)Lawsuit Filed Against Former Executives & Others
The Special Deputy Receiver of the insolvent Lincoln Memorial Life and Memorial Service Life Insurance Companies (both of which are associated with National Prearranged Services, Inc. (NPS)), along with participating life and health insurance guaranty associations, sued the former executives, lawyers, accountants, investment advisors, and trustees of the pre-need funeral plan and life insurance companies alleging the entire enterprise was a more-than $600 million racket supported by the malfeasance of former management and their professional advisors. Among its 27 claims for relief, the suit seeks treble and punitive damages under the federal Racketeer Influenced and Corrupt Organizations Act (RICO), the Lanham Act, and state consumer protection acts.
Consumers in 47 states purchased NPS pre-need funeral contracts through their local funeral homes. The vast majority of these pre-need funeral contracts were purportedly backed by life insurance policies issued by Lincoln Memorial and Memorial Service. Both Lincoln Memorial and Memorial Service were placed in receivership in Texas along with NPS on May 14, 2008. The companies were placed into liquidation on September 22, 2008, after the guaranty associations and the Special Deputy Receiver developed a plan to provide coverage for the insurance policies issued by the companies, notwithstanding the activities of the defendants. Guaranty associations to date have funded over $47 million in death benefits.
Suit was filed August 6, 2009, in the U.S. District Court for the Eastern District of Missouri Eastern Division (case number 4:09-CV-1252) in St. Louis by Reilly Pozner LLP, a Denver-based national trial firm whose partners have successfully represented state insurance guaranty associations in the past, most recently recovering $30 million from a regional brokerage firm on their behalf. That result flowed from the liquidation of Midwest Life Insurance Company and followed three successful jury trials in Colorado, Washington, and Iowa, the latter a three-month trial over the failed annuity provider.
Plaintiffs in the action include the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA); various state guaranty associations, including those of Missouri, Texas, and Illinois; and the appointed Special Deputy Receiver of the three failed companies, Donna J. Garrett.
Among the several dozen defendants are: NPS founder J. Douglas Cassity, a disbarred lawyer and convicted felon, his wife, and two sons; Randall K. Sutton, NPS's former president; attorneys, former NPS general counsel Howard A. Wittner and Katherine P. Scannell, and the law firm, Wittner, Spewak & Maylock; investment advisor David Wulf and the investment advisory firm Wulf Bates & Murphy; and a number of banks that became involved as trustees.
The 130-page complaint details years of systematic collusion, conversion, and fraud--the looting of hundreds of millions of funds. It can be viewed at www.rplaw.com.
Task Force Chair - Tad Rhodes; Staff Contact - Paul Peterson Medical Savings Insurance Company (Indiana)Online Expense Reports Due Today
The task force is collecting information concerning expenses incurred by affected guaranty associations in connection with the Medical Savings Insurance Company insolvency. The expense data will be used for purposes of reporting and for submission of an Omnibus Proof of Claim for this case. Our initial survey will include expense information for the reporting period from inception through June 30, 2009. Thereafter, we will be asking affected associations to update their expense data on a quarterly basis.
Expense data should be submitted by affected associations using NOLHGA's online proof of claim survey tool. Please complete your submissions by today, August 7. Note: Please advise Gus Estrada by e-mail ([email protected]) if you have no submissions to report. If you have any questions, please contact Mr. Estrada or Joni Forsythe (703.787.4103).
Task Force Chair - Dan Orth; Staff Contact - Joni Forsythe