Executive Life Insurance Company (California)
Judge Reinstates $241 Million Restitution Award
On February 26, 2013, U.S. District Judge Klausner ordered the reinstatement of $241 million in restitution in the “Altus Litigation” matter. Originally, this restitution amount was awarded by Judge Matz following the 2005 Artemis trial. The jury at the 2005 trial found that Artemis had knowingly joined the conspiracy to defraud the Commissioner and awarded $700 million in punitive damages. However, because the jury did not award compensatory damages, the punitive damages award was vacated by Judge Matz. Judge Matz instead awarded $241 million to the Commissioner as restitution.
On appeal, the Ninth Circuit Court of Appeals agreed with Judge Matz’s decision to vacate punitive damages, and the case was remanded for a second trial on damages based on the NOLHGA Premise. In the process, the restitution award was also set aside with leave to reinstate, if warranted, following the new damages phase trial.
The second trial took place in October 2012. The jury returned a verdict in favor of Artemis finding no damages based on the NOLHGA Premise. The Commissioner filed a motion to reinstate the restitution. Judge Klausner stated, “After review and consideration of the relevant law and facts, and the parties’ arguments, the Court finds restitution in the amount awarded by Judge Matz appropriate.” The $241 million award will be offset by the $110 million previously received by the Commissioner pursuant to a settlement between Artemis and the U.S. Attorney.
Task Force Chair - Art Dummer; Staff Contact - Bill O'Sullivan