On December 17, 2021, the Consumer Financial Protection Bureau settled its lengthy, five-year litigation with Access Funding, LLC, Access Holding, LLC, Reliance Funding, LLC, Lee Jundanian, Raffi Boghosian, Michael Brokowski, and Charles Smith for a paltry disgorgement of $40,000 and a $10,000 civil penalty. The settlement was approved by Judge Ellen Lipton Hollander, who took over the case after the retirement of Judge J. Frederick Motz in 2017. The stipulation states that Lee Jundanian was the CEO of Access Funding from February 2013 – May 2014, and an advisor to the company thereafter, and had an ownership interest in Access Funding from its inception to its dissolution. Boghosian was the chief operating officer of Access Funding from May 2014 to October 2015. According to the settlement stipulation, the Access Funding Defendants neither admitted or denied the allegations in the CFPB’s complaint, except those necessary to establish jurisdiction over the settling defendants.

On December 21, 2021, Maryland Attorney General Brian Frosh issued a press release announcing the indictment of three individuals in connection with the Access Funding structured settlement factoring scheme involving victims of lead paint poisoning.  Raffi Michael Boghosian, Charles Edward Smith, and Anuj Sud were charged with Theft Scheme over $100,000 and Conspiracy to Commit Theft Scheme Over $100,000.  According to the complaint filed by Attorney General Frosh in 2015, Boghosian was the chief operating officer of Access Funding and related affiliates. Sud filed most of the structured settlement transfer petitions on behalf of Access Funding, and Smith purportedly provided professional advice to the sellers. The Maryland Structured Settlement Protection Act, Md. Code Ann., Cts. & Jud. Proc. Section 5-1101, et seq., requires sellers to obtain independent professional advice in connection with any proposed transfer.

Kudos to a group of investigative journalists at the Minnesota Star Tribune for what is to be a four part series on abuses in the structured settlement factoring industry. The interactive article, with the first two parts published on October 3, 2021 is a wealth of data on more than 700 cases approved by Minnesota judges, as well as the personal stories of individuals impacted by some of those cases.

As pointed out by the Star Tribune, “In Minnesota, records show that one in eight transactions approved by local judges involved a seller with documented mental health problems. Many of those individuals received settlements after suffering traumatic brain injuries that permanently disrupted their lives.”

Further, according to the Star Tribune, “In interviews conducted over the past two years, a dozen judges complained about an approval process that seems stacked in favor of the settlement purchasing companies, with key information — such as civil commitment records — usually left out of files.”

Check back for additional posts on this exposé after Parts 2 -4 are published.

Jack Cohen, Board Chairman of the Association of BellTel Retirees passed away suddenly on September 29, 2021. Jack was a tireless advocate for all retirees, as well as a beloved husband and doting grandfather. The world is a lesser place without Jack Cohen, and his sage advice and wisdom on issues facing retirees will be sorely missed by all of us here at Edward Stone Law. Rest in Peace, Jack Cohen.

A link to Jack’s obituary can be found here. If you would like to make a donation to one of the non-profits that were important to Jack, you can do so at the links below.

The Association of BellTel Retirees:  https://belltelretirees.org/donate-now/

Support Connection: https://supportconnection.org/donate-now/

HP Inc., the Palo Alto, California based technology company will transfer $5.2 Billion in pension liabilities to Prudential Insurance Company of America as of October 31, 2021. HP disclosed this information in its recent 10-Q filing. This represents approximately one-half of HP’s U.S. pension liabilities. The pension de-risking transfer affects some 41,000 retirees and beneficiaries.

Last month, on July 12, 2021, in Consumer Financial Protection Bureau v. Access Funding, LLC, et al, (Case No. 16-3759, U.S. District Court, District of Maryland) Judge Ellen Hollander denied a motion to dismiss the amended complaint and a motion for a judgment on the pleadings. The amended complaint filed in 2017 against Access Funding, LLC, Access Holding, LLC, Lee Jundanian (former CEO of Access Funding), Raffi Boghosian, COO of Access Funding, Michael Borkowski, CEO of Access Funding, and Charles Smith, Esq., an advisor for Access Funding alleged that the defendants employed abusive practices when purchasing structured settlements from consumers in exchange for lump-sum payments.  The case was stayed for several years pending the Supreme Court’s decision in Seila Law LLC v. CFPB, __ U.S.__, 140 S. Ct. 2183 (2020). In her July 12th memorandum opinion, Judge Hollander found that while Seila Law was not binding, the facts in that case were similar to the Access Funding case. As such, she denied defendants motion and the CFPB’s enforcement action against Access Funding, Jundanian, Boghosian, Borkowski, and Smith will continue.

This August 2, 2021 Washington Post feature article examines the controversial practice of “race-norming” and its use by the NFL in determining compensation for former players in the NFL Concussion Settlement. The Washington Post’s investigation found that “the NFL and Seeger are responsible for building a settlement claims process that guaranteed race-norming would occur, making it more difficult for some Black former players to qualify for payments, and they failed to act on concerns that the practice was discriminating against Black former players as far back as 2019.” According to the Washington Post, counsel for the NFL, Brad Karp, declined to be interviewed for the article, but in written statements to the Post, “continued to defend the practice of race-norming and disputed claims made by former players, their lawyers, and some members of Congress that the practice is discriminatory.”

Najeh Davenport and Kevin Henry sued the NFL in August 2020, alleging that their “cognitive function” test scores were manipulated using “race-norming” to reduce their chances of receiving benefits under the concussion settlement. Judge Anita Brody dismissed their claims in March 2021 as “an improper collateral attack on the settlement agreement in the NFL multidistrict litigation” but expressed concern over the practice of race-norming and ordered that the NFL and Class Counsel, Seeger Weiss address the issue with Magistrate David Strawbridge. In June 2021, Judge Brody allowed Mr. Davenport and Mr. Henry to participate in the mediation with the NFL and Class Counsel.

Kevin Henry and Najeh Davenport are represented by Cyril V. Smith, Aitan D. Goelman and Ezra B. Marcus of Zuckerman Spaeder LLP, Edward S. Stone of Edward Stone Law PC, and J.R. Wyatt of J.R. Wyatt Law PLLC. The two cases are In re: National Football League Players’ Concussion Injury Litigation, No. 2:12-md-02323 (E.D. Pa.), and Henry et al. v. NFL, No. 2:20-cv-04165 (E.D. Pa).

Lockheed Martin transferred $4.9 billion in pension obligations to two of Bermuda based Athene’s subsidiaries, Athene Annuity and Life Company and Athene Annuity & Life Assurance Company of New York. This is Lockheed’s second pension risk transfer transaction with Athene, and s is Lockheed’s fourth pension de-risking transfer in the last two years. In 2019, $1.9 Billion in pension liabilities was transferred to MetLife; in 2020 Metropolitan Life Tower (a MetLife subsidiary) took on $1.4 Billion of Lockheed’s pension liabilities, and in 2018 $800 Million was transferred to Athene.

This latest pension de-risking transfer affects approximately 18,000 participants of Lockheed Martin’s pension plan who are currently receiving benefits. Beginning on January 1, 2022, Athene will take over the payment and administration of retirement benefits for these 18,000 retirees and their beneficiaries.

Just one day after the NFL announced that it would work to end  the use of “race-norming” in the NFL Concussion Settlement, U.S. District Judge Anita Brody (E.D. Pa.) granted the request of two former Pittsburgh Steelers, Kevin Henry and Najeh Davenport to intervene in the mediation between the NFL and class counsel, Chris Seeger. Mr. Davenport and Mr. Henry sued the NFL in August 2020 alleging civil rights violations resulting from the use of “race-norms” in the NFL Concussion Settlement. The suit was dismissed by Judge Brody as “an improper collateral attack on the settlement agreement….”

The controversial practice of “race-norming” assumes that Black players have a lower cognitive function compared to non-Black players, which made it much more difficult for Black players to qualify for an award in through the NFL Concussion Settlement.

Last month, a group of NFL families dropped off more than 50,000 petitions at the Federal Courthouse in Philadelphia where Judge Anita Brody dismissed Mr. Henry’s and Mr. Davenport’s civil rights lawsuit which alleged that both former players would have received settlement awards from the NFL if the settlement administrators had applied the same norms used for non-Black players.

The NFL Concussion Settlement was finalized in 2017. Since that time, more than 2,000 former players have filed claims, but fewer than 600 former players have received awards.

Henry and Davenport are represented by Cyril V. Smith, Aitan D. Goelman and Ezra B. Marcus of Zuckerman Spaeder LLP, Edward S. Stone of Edward Stone Law PC, and J.R. Wyatt of J.R. Wyatt Law PLLC. The two cases are In re: National Football League Players’ Concussion Injury Litigation, No. 2:12-md-02323 (E.D. Pa.), and Henry et al. v. NFL, No. 2:20-cv-04165 (E.D. Pa).

February 2020:  Armstrong World Industries transfers $1 Billion for 10,000 retirees to Athene

December 2020: Lockheed Martin transfers $1.4 Billion of pension liabilities for 13,500 retirees to MetLife

December 2020: Phillips North America transfers $1.2 Billion in pension liabilities for 11,000 retirees to MetLife and Principal

December 2020:  GE transfers $1.7 Billion of pension liabilities for 70,000 retirees to Athene.

February 2021: Dow transfers $700 Million in pension liabilities for 12,000 retirees to MetLife

April 2021: JCPenney transfers $2.8 Billion in pension liabilities for 30,000 retirees to Athene