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Life Insurance & Annuities Litigation


Overview

For close to three decades, we have been at the forefront of defending life insurance and annuity issuers and other financial services companies in every major genre of litigation affecting the industry. Such representation includes national litigation challenging the determination of cost of insurance rates and other nonguaranteed elements, "vanishing premium" and other life insurance and annuity sales practices/market conduct cases, ERISA fiduciary duty suits, and litigation over lender placed insurance. Our lawyers not only understand the legal issues relevant to these cases, we have a deep background in our clients' products, business practices, and regulatory challenges. We work closely with our colleagues in other practice areas, including the firm's Financial Services - Regulatory, Class Actions, and Securities and Derivative Litigation practice groups, to ensure we bring the highest level of expertise to every matter.

As a result, the industry knows us well. Our lawyers have represented the vast majority of the top 25 life and annuity companies (by assets) in class action and high stakes individual product cases. The firm has represented dozens of national and international insurers in hundreds of class actions throughout the United States. Indeed, our clients have consistently recognized us as among the top "go to" firms for national class action and high stakes litigation for the life insurance industry.

We have appeared as lead counsel in state and federal courts in nearly every state, including in appeals in all 12 of the Federal Circuit Courts of Appeal and the United States Supreme Court. But we are not simply litigators: our lawyers are prepared to try cases. We defended as lead counsel what is believed to be the largest jury trial of a certified national class action involving the life insurance industry, a case involving a nationwide class of approximately 400,000 annuity contract holders seeking $2 billion in damages, in which the jury returned a verdict for our client.
 

  • Cost of Insurance and Other Challenges to Non-Guaranteed Element Determinations
    • We have extensive experience defending the life insurance industry in matters involving challenges to insurers' determinations regarding the cost of insurance (COI) rates in fixed and variable universal life insurance policies, including litigation regarding COI rate increases. 
    • We have defended against challenges to insurers' exercises of discretion with regard to other non-guaranteed elements, e.g., interest/dividend crediting, and expense allocation-related claims.


    Learn more about our experience defending life insurers against challenges to their exercises of discretion in setting non-guaranteed elements.

  • Sales Practices - Market Conduct Litigation
    • Our litigators have wide-ranging experience defending insurers in lawsuits alleging the improper sale or marketing of life insurance and annuity products. 
    • Our attorneys have dismissed, settled, and won trial victories in class actions claiming, inter alia, that the sales of annuities and long term care policies were misleading; that life insurance policies were marketed as having "vanishing premiums" and/or were improperly replaced; that the insurer allegedly violated the TCPA; and that plans were improperly sold as complying with I.R.S. §§ 412(i) and 409.

     

    Learn more about our experience defending life insurance and financial services companies against sales practices and other market conduct claims.

  • ERISA Fiduciary Duty Litigation
    • The firm's practice in this area is devoted to representing insurers, financial institutions, and employee benefit plan sponsors in the areas of class action and other complex litigation, financial product development, regulatory compliance, and regulatory monitoring and advocacy. 
    • We have extensive experience litigating fiduciary and prohibited transaction claims, as well as other alleged violations of ERISA and other federal and state laws in connection with the management of pension or welfare plan funds, the provision of trust, custodial, actuarial, accounting, and other services to plans, and the administration of employee benefit claims. 
       

    Learn more about our experience defending financial services companies against ERISA claims.

  • Lender-Placed Insurance Litigation
    • Competing groups of class action lawyers have filed approximately 150 high profile class actions in venues all across the United States challenging aspects of lender-placed insurance programs (LPI). A team of our lawyers have represented the largest LPI underwriting group of specialty insurers, and several banks and servicers, in defending these cases. 
    • In addition to achieving early dismissal of several of these cases (at both the trial and appellate levels), the LPI litigation teams have developed an effective settlement strategy for the defendants, and implemented that strategy in nationwide settlements for most of the major lenders and loan servicers. Trial and appellate courts in numerous jurisdictions have approved these settlements, often over the opposition of experienced objectors.

     

All Insights

Court Invalidates California Unclaimed Property Law Regulations

Court Invalidates California Unclaimed Property Law Regulations

October 1, 2018

A California state court recently enjoined the state from enforcing two rules adopted by the Office of the State Controller without compliance with the California Administrative Procedure Act (APA) concerning the state’s Unclaimed Property Law (UPL).

Even Disclaiming ‘Magic Words’ Won’t Save Plaintiffs from SLUSA Preclusion

Even Disclaiming ‘Magic Words’ Won’t Save Plaintiffs from SLUSA Preclusion

October 1, 2018

In 2016, a putative class action lawsuit was filed in California state court on behalf of all persons over the age of 60 who were issued a variable annuity policy by defendants within the state.

Louisiana Appeals Court Affirms Class Certification in Lingering Litigation Against Department of Insurance

Louisiana Appeals Court Affirms Class Certification in Lingering Litigation Against Department of Insurance

October 1, 2018

A Louisiana appeals court recently affirmed class certification in consolidated lawsuits, pending since 1991, against Louisiana’s Department of Insurance, other related state entities, and the state’s excess insurance carriers.

SEC Proceedings Face Uncertainty After Supreme Court Holds ALJs Unconstitutional

SEC Proceedings Face Uncertainty After Supreme Court Holds ALJs Unconstitutional

October 1, 2018

After much anticipation, the U.S. Supreme Court ruled on the constitutionality of the Securities and Exchange Commission’s (SEC or Commission) Administrative Law Judges (ALJs). In Lucia v. SEC, Dkt. No. 17–130, the Supreme Court held that ALJs are “Officers of the United States” subject to the Appointments Clause of the U.S. Constitution, rather than mere federal employees.

Second Circuit Affirms Summary Judgment for Bona Fide Purchaser in STOLI Action

Second Circuit Affirms Summary Judgment for Bona Fide Purchaser in STOLI Action

October 1, 2018

In a June 8, ruling in AEI Life v. Lincoln Benefit Life Co., the Second Circuit upheld the District Court for the Eastern District of New York’s application of New York’s two-year incontestability period to a STOLI policy.

Although Largely Deflated, IUL Illustration Statute Lawsuit Rolls On

Although Largely Deflated, IUL Illustration Statute Lawsuit Rolls On

July 27, 2018

Almost a year ago, the U.S. Court of Appeals for the Ninth Circuit ruled that an alleged violation of California’s illustration statutes could serve as a predicate for liability under the California Unfair Competition Law.

COI Litigation Update

COI Litigation Update

June 25, 2018

Life insurers that defend challenges to their exercises of discretion to adjust cost of insurance (COI) rates on universal life insurance policies continue to seek opportunities to narrow the scope of the claims through early dispositive motions.

Ninth Circuit: Face Amount Controls Amount-in-Controversy Questions Where Policy’s Validity is Disputed

Ninth Circuit: Face Amount Controls Amount-in-Controversy Questions Where Policy’s Validity is Disputed

June 25, 2018

In March, the Ninth Circuit provided clarity on a key and recurring issue relevant to a district court’s ability to exercise subject matter jurisdiction in actions involving the validity of life insurance policies.

To Preempt or Not to Preempt - Courts Issue Competing SLUSA Rulings

To Preempt or Not to Preempt - Courts Issue Competing SLUSA Rulings

June 25, 2018

During two weeks in April, two different courts — the Second Circuit and the New Jersey Superior Court — considered nearly identical allegations regarding variable products and reached diametrically opposed conclusions about the extent to which the claims were barred by the Securities Litigation Uniform Standard Act (SLUSA).

Win for MassMutual in Rare Class Action Trial

Win for MassMutual in Rare Class Action Trial

June 25, 2018

A California jury recently returned a verdict in favor of MassMutual following a 12-day trial in a state-court class action that claimed the insurer failed to pay dividends owed to policy owners.

Several Teams Compete to Reach NAIC Suitability Model Finals

Several Teams Compete to Reach NAIC Suitability Model Finals

June 5, 2018

Several teams competed over proposed revisions to the Suitability in Annuity Transactions Model Regulation (#275) at the in-person meeting of the NAIC Annuity Suitability Working Group.

Changes to New York Insurance Regulation 187: Are They April Showers Bringing May Flowers, or Are June Bugs on the Way?

Changes to New York Insurance Regulation 187: Are They April Showers Bringing May Flowers, or Are June Bugs on the Way?

April 30, 2018

If issued, the updated proposed first amendment will take effect on March 1, 2019.

New York Department of Financial Services Rings in the New Year with New Suitability Requirements for Insurance Companies

New York Department of Financial Services Rings in the New Year with New Suitability Requirements for Insurance Companies

January 1, 2018

New York’s Department of Financial Services (NY DFS) decided to bid farewell to 2017 and ring-in the new year by proposing to amend Suitability in Annuity Transactions, 11 NYCR 224 (the Annuity Suitability Rule).

Based on Principles of Fairness, Court Dismisses Putative Class Action RICO Claims Asserted Years After Initiation of Suit

Based on Principles of Fairness, Court Dismisses Putative Class Action RICO Claims Asserted Years After Initiation of Suit

December 29, 2017

In Robertson v. SunLife Financial, a federal district court in Louisiana dismissed with prejudice as time-barred an amended putative class action complaint alleging RICO and state racketeering claims related to alleged wrongful conduct by an agent related to annuities issued by SunLife.

COI Litigation Review – Early Dismissals Remain Elusive in Rate Increase Actions

COI Litigation Review – Early Dismissals Remain Elusive in Rate Increase Actions

December 29, 2017

Suits challenging insurers’ cost of insurance (COI) rate increases continue to generate much activity. In recent months, this activity has included transfers, consolidations, several actions that are inching closer to trial-readiness, and even a plaintiff’s jury verdict in an individual action.

Denial of Reinstatement of Lapsed Life Insurance Policy Affirmed Due to Failure to Satisfy Required Underwriting Standard

Denial of Reinstatement of Lapsed Life Insurance Policy Affirmed Due to Failure to Satisfy Required Underwriting Standard

December 29, 2017

In European Pensions Management Limited v. Columbus Life Insurance Co., a pension benefit plan that had purchased a life insurance policy on the secondary market and then permitted it to lapse for non-payment of premiums sued the insurer Columbus Life, alleging breach of contract and bad faith.

The Continuing Representation Doctrine Does Not Apply to Fraud Allegations

The Continuing Representation Doctrine Does Not Apply to Fraud Allegations

December 29, 2017

In Messmer v. KDK Fin. Serv. Inc., an individual action involving alleged fraud in connection with the sale and surrender of deferred annuities to a senior, the Indiana Court of Appeals refused to extend the doctrine of continuous representation to cases involving fraud and brokers of financial services.

Dismissal of Individual Claims Cap Insurer’s Winning Streak in Action Challenging FIA Product Features

Dismissal of Individual Claims Cap Insurer’s Winning Streak in Action Challenging FIA Product Features

September 26, 2017

In May, the Southern District of California handed ING a win in a case involving allegations that the company targeted seniors with annuities that hid an embedded derivative structure that made them worth less than promised.

Eleventh Circuit Affirms Summary Judgment or Insurer in STOLI Case

Eleventh Circuit Affirms Summary Judgment or Insurer in STOLI Case

September 26, 2017

In Sun Life Assur. Co. of Canada v. U.S. Bank Nat. Ass’n, the Eleventh Circuit recently clarified that where a life insurance policy lacks an insurable interest at its inception and is thus void ab initio, prejudgment interest accrues from the date of payment.

Plaintiffs Survive Standing-Based Challenge to California Senior Notice and Financial Elder Abuse Claims

Plaintiffs Survive Standing-Based Challenge to California Senior Notice and Financial Elder Abuse Claims

September 26, 2017

In California, actions predicated on alleged senior notice requirement violations and financial elder abuse continue to challenge life insurers.

Sticking Firmly to Contract Terms, Court Dismisses Premium and COI Overcharge Claims

Sticking Firmly to Contract Terms, Court Dismisses Premium and COI Overcharge Claims

September 26, 2017

In July, in Hancock v. Americo Financial Life & Annuity Co., Americo achieved a total victory on its motion to dismiss a putative class action in the Eastern District of North Carolina that challenged its premium and COI charges. Hancock v. Americo Financial Life & Annuity Co.

Summary Judgment Win for Insurer in “Stable Value” Interest Rate Setting Case

Summary Judgment Win for Insurer in “Stable Value” Interest Rate Setting Case

September 26, 2017

In July, MetLife obtained a win in the Northern District of Illinois when the court granted summary judgment in its favor on a claim that it had breached the duty of good faith and fair dealing in setting interest rates for a retirement plan.

New York DFS Tightens Cybersecurity Gaps

New York DFS Tightens Cybersecurity Gaps

September 19, 2017

Equifax takes no deposits and makes no loans, but New York now says that it, as well as all other consumer reporting agencies, must protect consumer data to the same degree as banks and other financial institutions.

Insurers and Brokers May Face UCL Liability for Violations of Insurance Statutes

Insurers and Brokers May Face UCL Liability for Violations of Insurance Statutes

July 1, 2017

The opinion was a beacon of hope for insurers and brokers doing business in California who often face disappointing early rulings and frequently settle.

Eighth Circuit Affirms Dismissal of RICO Claim in So-Called Shadow Insurance Suit

Eighth Circuit Affirms Dismissal of RICO Claim in So-Called Shadow Insurance Suit

June 23, 2017

In Ludwick v. Harbinger Group, the U.S. Court of Appeals for the Eighth Circuit affirmed the dismissal under the McCarran-Ferguson Act of a federal RICO claim against Fidelity & Guaranty (and its owner and several affiliates) alleging that F&G had engaged in statutory accounting fraud to create a false impression of capital adequacy.

Eleventh Circuit to Weigh in on ‘Business Email Compromise’ Coverage Under Fidelity Bond

Eleventh Circuit to Weigh in on ‘Business Email Compromise’ Coverage Under Fidelity Bond

June 23, 2017

Banks have historically been at the forefront of technological advances in commerce. So it should be no surprise that they and other financial institutions were also among the first to suffer losses related to computer fraud and hacking.

Recent Ninth Circuit Rulings Uphold Plaintiffs’ Efforts to Predicate Claims on Alleged Insurance Code Violations — Likely More to Come

Recent Ninth Circuit Rulings Uphold Plaintiffs’ Efforts to Predicate Claims on Alleged Insurance Code Violations — Likely More to Come

June 23, 2017

Recent rulings suggest insurers face increased risk of suits predicating breach of contract and state unfair trade practices claims on alleged violation of state insurance laws, notwithstanding the lack of an express private right of action.

Summary Judgment for Insurer in Annuity Sales Practices Action

Summary Judgment for Insurer in Annuity Sales Practices Action

June 23, 2017

Like many of the bonus annuity class actions brought in the mid-2000s, the plaintiff in Chambers claimed that the insurer misrepresented the terms of the bonus, that there were no "sales fees," and that the interest adjustment applied to partial surrenders.

Fraud-Free Sunsets: How Financial Professionals Can Deter Financial Elder Abuse in Florida and Reduce Their Own Liability Exposure

Fraud-Free Sunsets: How Financial Professionals Can Deter Financial Elder Abuse in Florida and Reduce Their Own Liability Exposure

May 3, 2017

Investment advisers, securities brokers, and other financial professionals who work directly with clients who are age 60 and older have two reasons to learn more about Florida’s financial elder abuse laws.

Cost of Insurance Litigation Review

Cost of Insurance Litigation Review

April 10, 2017

While organized as a single cause of action, the plaintiff in Brach asserted AXA’s COI rate increase was a breach of contract pursuant to several theories of liability. In denying AXA’s motion to dismiss the claim, the court found each theory to be plausible.

Court Applies “Fiduciary Exception” to Mutual Fund Trustees’ Attorney-Client Privilege

Court Applies “Fiduciary Exception” to Mutual Fund Trustees’ Attorney-Client Privilege

April 10, 2017

In Kenny v. Pacific Inv. Mgm’t Co. LLC (W.D. Wash.), a federal judge recently ruled that a mutual fund’s independent trustees must produce certain documents that the trustees had redacted or withheld based on attorney-client privilege.

Second Circuit Affirms Dismissal of

Second Circuit Affirms Dismissal of "Shadow Insurance" Lawsuits

April 10, 2017

The suits were two of several class actions that arose in the wake of a 2013 investigation by the New York Department of Financial Services into certain captive reinsurance transactions

The Ninth Circuit Finds California’s Illustration Statutes Can Serve as the Predicate for UCL Liability

The Ninth Circuit Finds California’s Illustration Statutes Can Serve as the Predicate for UCL Liability

April 10, 2017

On March 3, the Ninth Circuit in Walker v. Life Ins. Co. of the SW, ruled that an alleged violation of California’s life insurance illustration statutes could serve as a predicate for liability under the California Unfair Competition Law (UCL).

Transparency Watch: Federal District Court Mandates Automatic Disclosure of Third-Party Funding Arrangements for Class Actions

Transparency Watch: Federal District Court Mandates Automatic Disclosure of Third-Party Funding Arrangements for Class Actions

April 10, 2017

In January, the U.S. District Court for the Northern District of California announced a change that makes litigants in putative class action suits subject to requirements mandating automatic disclosure of third-party funding arrangements.

Scratching the Surface: The FTC’s Phishing Tips for Victim Companies Are a Good First Step but Companies Should Not Stop There

Scratching the Surface: The FTC’s Phishing Tips for Victim Companies Are a Good First Step but Companies Should Not Stop There

March 12, 2017

In one type of phishing, fraudsters impersonate your business when contacting consumers. Phishing victims think they’re giving information to your company — by phone or Internet —but instead give personal or financial information to the fraudster.

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The information on this website is presented as a service for our clients and Internet users and is not intended to be legal advice, nor should you consider it as such. Although we welcome your inquiries, please keep in mind that merely contacting us will not establish an attorney-client relationship between us. Consequently, you should not convey any confidential information to us until a formal attorney-client relationship has been established. Please remember that electronic correspondence on the internet is not secure and that you should not include sensitive or confidential information in messages. With that in mind, we look forward to hearing from you.