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Case ID: 3455 | Insurance | 06/07/2004
A class action has been filed against Pacific Life Insurance Company by persons in the United States who, through their ownership of a Pacific Life annuity or insurance product, held units of any Pacific Life sub-account invested in mutual funds which included foreign securities. The actions claim that the defendants violated federal securities laws by utilizing market timing strategies to increase company profits to the detriment of annuity holders. The investors seek disgorgement of all profits wrongfully made through the scheme.
The Pacific Life Individual Flexible Premium Deferred Variable Annuity is but one of a number of annuity products offered to investors by the company, and happens to be the product in which named plaintiff Terry Spurgeon invested. Under these contracts, individual investors agree to make at least one minimum premium payment to Pacific Life for a series of annuity payments at a later date. The Pacific Life annuities which are the subject of this litigation each consist of a "separate account" which keeps investors’ assets separate from Pacific Life's assets, and each annuity’s separate account is further divided into multiple sub-accounts. Each sub-account corresponds to a single mutual fund, and Pacific Life invests the assets of each sub-account in that sub-account’s corresponding mutual fund. These mutual funds are maintained exclusively for variable annuity or variable life insurance products, although they often bear names reseller to those of retail mutual funds. Many of the mutual funds in which the annuity sub-accounts are invested include securities which are traded in markets outside the United States. In valuing the assets of a mutual fund, the fund manager uses the last trade price in the home market of each of the securities in its portfolio. The home markets for such foreign securities include London, Paris, Frankfurt, Moscow, Singapore, Kuala Lumpur, Hong Kong, Taipei, Tokyo, and Sidney. These markets are located in time zones that are five to 15 hours ahead of Eastern time. Company policy dictates that units in Pacific Life's sub-accounts can be traded, either by purchase or redemption, only once a day at 4 p.m. Eastern time. The action alleges that sub-account managers failed to make daily adjustments based upon the direction and degree of correlations between movements in US and foreign markets, changes in the value of American Depository Receipts, and fluctuations in foreign currency futures markets when valuing the unit values of sub-accounts. By using prices that have been stale for five to 15 hours, account managers allegedly use a market timing strategy which is highly profitable to Pacific Life, and detrimental to holders of these Pacific Life annuities. At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Insurance Cases of Interest A nationwide class action has been filed in Ohio against life insurance giant, Lincoln National Life Insurance Company. The action is brought on behalf of all U.S. residents who purchased life insurance policies from Lincoln and paid for such policies upon delivery, but who were actually charged a premium based on the earlier "policy date" when the policy was approved. The action is brought under state law for breach of contract and unjust enrichment and seeks compensatory damages, disgorgement of profits and injunctive and declaratory relief. The parties have reached a tentative settlement apparently valued at $25 million in several actions filed against UICI, Inc., and its principal insurance subsidiaries MEGA Life and Health Insurance Company and Mid-West National Life Insurance Company of Tennessee on behalf of policyholders insured through groups associated with the companies. Persons eligible to take part in the action should contact the attorneys for the class for more information. Eligible motorists and health care providers have until Monday December 6th to claim a share in a $9.5 million jury verdict against Farmers Insurance. The verdict against Farmers was returned in a class action lawsuit in Multnomah County Circuit Court on December 5, 2003. Class members, eligible for a share of the jury award, include people who were injured in a motor vehicle accident between January 26, 1998 and July 31, 1999 and had a claim with Farmers Insurance. Also eligible for a share of the award are the doctors and medical clinics that treated the injured individuals. All claims must be postmarked no later than December 6, 2004. So far approximately 3000 individuals have filed claims. The benefits available are estimated at $207.00 per claimant. Numerous class actions have been filed against New Hampshire banks and credit insurance companies on behalf of persons who financed vehicles in New Hampshire, purchased credit life or credit disability insurance, and then paid off their loans early between 1999 and the present. The actions allege that the defendants failed to return the unused premiums in violation of New Hampshire insurance law. A class action lawsuit has been filed in the Western District Court of Washington against Prudential Insurance for violations of. Class members seek compensatory damages, punitive damages, and damages under the Washington State Consumer Protection Act as well as for costs and attorneys' fees pursuant to the litigation. The Armenian Genocide of 1915 was the first mass killing in the 20th Century—between 1.5 and 2 million people were killed. A class action has been filed against German insurance company Victoria Versicherung AG and three related companies on behalf of descendants of victims massacred in the Armenian Genocide of 1915, who allege that the company failed to pay life insurance policy proceeds to them. |
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