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2May/12Off

Competing structured settlement purchasers continue their battles in court

Houston, TX – According to a recent press release by The Structured Settlement Institute, JGWPT Holdings and David Miller, JGWPT’s CEO has been sued in Harris County for allegedly colluding with competing factoring companies to fix prices. [1]

The lawsuit also claims that J.G. Wentworth, JGWPT, Peachtree and other entities are being sued for entering into agreements with members of trade association The National Association of Settlement Purchasers (NASP) to refrain from soliciting customers of other NASP members* as well as making competitive bids to customers who have signed agreements. [1]

This lawsuit is part of ongoing litigation between RSL Funding and Peachtree. Each side accuses each other of myriad of improprieties. For example, JGWPT was able to quash RSL Funding’s oral deposition of Fortress Funding’s Michelle Hofkin because they claimed lead counsel and RSL Funding CEO Stewart Feldman purposely scheduled the deposition during a time when Peachtree’s counsel was unavailable. [2][3]

Another example of the many accusations include one stated by SSI spokesperson and RSL Funding’s Vice President of Sales and Marketing Paul McHugh, “Another common tactic used by Wentworth is to have its customers ‘shop’ its offers with sister company Peachtree, with the customer not knowing that Peachtree and Wentworth are affiliated and share call data, ensuring that they don’t compete with one another. Customers are lured into believing they are getting a fair deal when the other company doesn’t make a better competitive offer,” explained McHugh. [1]

It was previously reported that RSL filed a countersuit in March against Peachtree and its entities claiming they allegedly engaged in activities that violate Structured Settlement Protection Acts by bribing and/or enticing potential sellers of structured settlement annuity payments without providing the proper disclosures to the courts. The suit also states that JGWPT removes the contact information of the sellers in order to block competitors. In addition, there are numerous claims about the wrongful seizure of equipment, furnishings and other property by the defendants. [4]

Peachtree had previously accused RSL of offering its customers more money for their annuities as well as fraud. RSL admitted they did offer their clients more money therefore the trial judge sided with Peachtree thereby preventing RSL from competing in the secondary marketplace. [4]

An appeals court dissolved and reversed a temporary injunction against the RSL Funding LLC, which had prevented it from competing for Peachtree Settlement Funding’s U.S. clients. The decision was reversed because the ruling was “an unreasonable restraint on trade.” [4]

RSL claims that Peachtree has continued to try to impose similar over broad injunctions against them. [4]

Peachtree Financial merged with J.G. Wentworth in July and formed a new holding company called JGWPT. The combined company is based out of Radnor, PA and are owned by JLL Partners in New York. It is estimated that JGWPT controls an estimated 65-80% of the structured settlement factoring market.

RSL Funding is a Houston, TX based purchaser of structured settlements. Its CEO, Stewart Feldman is CEO of Capstone Associated Services, Ltd. and Managing Partner at The Feldman Law Firm LLP.
*Rescue Capital is not a member of any trade organizations including NASP.

1. http://www.prlog.org/11864997-jg-wentworth-sued-over-attempts-to-defraud-and-harm-consumers-and-restrict-competition.html

2. Case No. 2006-23366, 113th Judicial District Court, Harris County, TX

3. Case No. 2009-78934, 334th Judicial District Court, Harris County, TX

4. RSL Funding and JGWPT Battle It Out




Posted by Dawn Anderson