Wrongful Conviction /Wrongful Incarceration /Physical Injury Cases
Plaintiff v. City, County and State.
Plaintiff was wrongfully accused, convicted and imprisoned for 25 years. From the beginning, plaintiff was adamant about his innocence; combative with police, prosecutors, prison guards and fellow inmates; resulting in plaintiff experiencing two and a half decades of nearly daily injuries including: beatings, stabbings, pain and suffering, physical abuse, and constant torment.
Following exoneration based on DNA evidence, recanted testimony of prosecution witnesses, and newly discovered exculpatory evidence that had been “misplaced” by the prosecution, plaintiff sued for damages.Plaintiff’s counsel, ever cognizant of their client’s proclivities for squandering money, and aware of Creative Capital’s reputation and expertise in this area of the law, contacted CCI to assist in the settlement process and to protect the plaintiff from being victimized yet again by his own poor financial decisions and by a myriad of so called “advisors”.CCI’s first step was to obtain the pleadings from counsel; review the complaint, answers to interrogatories, deposition transcripts, prison hospital records, etc.; and then present a case to the life insurers in the structured settlement industry to determine which of these companies would be available to underwrite a settlement annuity compliant with I.R.C. sections 104(a)(2) and 130.
As settlement discussions with defense counsel were underway, plaintiff’s attorneys, acting on the advice of the CCI Team, insisted on a structured settlement as a condition of settlement, with Creative Capital as the broker of record.
During negotiations, the CCI Team worked with plaintiff and counsel by illustrating future periodic payment plans combined with an up-front sum to be managed by a financial professional. This approach satisfied plaintiff. He understood that if a structured settlement could be achieved, he would have ample financial security to last a lifetime for himself, his spouse and children.
Ultimately, an eight figure settlement was achieved. The tailor made future periodic payment plan, funded with settlement annuities underwritten by four major life insurers , was locked-in as counsel for all parties, working with CCI’s General Counsel and paralegals, crafted the necessary Term Sheet, Settlement Agreement and Release, Court Order, and Qualified Assignments.
During the “document negotiations”, CCI’s General Counsel strategized with plaintiff’s attorneys and often interacted independently on their behalf with defense counsel to explain and iron out the language necessary to achieve a tax compliant and legally sufficient set of documents.
As we do in all cases, CCI worked the case until conclusion, including the delivery of the annuity contracts.
Structured Attorney’s Fee in Wrongful Imprisonment Case
In another wrongful imprisonment case with similar facts, plaintiff’s counsel sought to defer taxation on a portion of his fee. As part of the negotiations with defendant, future periodic payments of one-half of the fee that would have otherwise been payable in full at the time of settlement were agreed upon. In this way, plaintiff’s counsel not only deferred taxation until the years of actual receipt, but also enhanced his fee since the annuity provided a greater return than the deferred portion of the fee.
Example: A $1Million fee is structured. The attorney receives $1.3Million over time in scheduled future periodic payments which are fixed and determined at the time of settlement. These periodic payments are not dependent on future stock or bond market performance and will be paid to the attorney or his designated beneficiary. The full $1,300,000.00 payout, spread over a number of years, is only taxable in the years received on the amount received in each year. This often produces the desired result of lowering the recipient’s (attorney or beneficiary) tax bracket.
Additionally, many attorney clients of CCI have chosen to have their fees paid over a fixed period of years PLUS for their lifetime thereafter. This is a popular retirement planning tool.
Non Physical Injury Cases
Equal Employment Opportunity Commission v. Utility Company
The Equal Employment Opportunity Commission (EEOC) brought this employment discrimination case against a utility company. The EEOC represented 136 Charging Parties (plaintiffs) alleging discrimination in the terms and conditions of employment. The utility company had offered a multi-million dollar sum in settlement, which was rejected by the EEOC as insufficient. With the utility company not wanting to spend more in settlement, the case was heading to trial when CCI was called in. Splitting the sum that the company offered, we proposed that half of it be provided in up-front cash. A formula based on age, salary and years to retirement, was devised for the balance of the money and offered along with enhanced retirement benefits to the plaintiffs. A settlement was achieved to the satisfaction of all parties: With some of the cash up-front and secured payments over time, our format was acceptable to the EEOC and their clients. The utility company was satisfied that they did not go beyond their original offer.
Home Owner v. Bank
CCI has handled a number of "wrongful foreclosure" cases on behalf of a large bank, which has issued hundreds of thousands of loans and holds the mortgages on residential property. Unfortunately, a number of mortgages have been wrongfully foreclosed over the years resulting in lawsuits by the former homeowners. CCI has successfully structured several of these cases. One technique is to match the structured benefits to the monthly mortgage payment on a replacement home. In egregious cases, "extra" benefits have been provided via a structured settlement to help settle the case.
Single Age Discrimination Plaintiff v. Corporation
CCI has been instrumental in many ADEA (Age Discrimination in Employment Act) cases over the years. These have been accomplished with and without assignments. The older cases, pre-1990, were done with an allocation between taxable and tax-free payments (they're all taxable now) with the tax-free payments being assigned. On current cases we now have the Allstate/NABCO assignment available.
Other Employment Cases
This wrongful discharge case was a six-figure employment matter against the same bank client mentioned in Home Owner v. Bank above. In this fully taxable situation, the sum originally offered ($700,000 net of fees and expenses) would have resulted in a $350,000 tax hit. Understandably, the plaintiff rejected the offer. CCI worked out an acceptable structure using Allstate's new non-qualified assignment. The bank agreed to future periodic payments, NABCO took the assignment, and an Allstate annuity was purchased. With this new structured settlement product, the case settled for the same dollar amount originally offered in cash. Both parties benefited: The defendant was able to take a full tax deduction for the cost of settlement in the year of settlement, and the plaintiff was able to receive settlement payments over time, remaining under the threshold of the Alternative Minimum Tax (AMT) rules.
Law Firm Break-up
A law firm, in the process of dissolving, was involved in a dispute with several partners. Long term disability and life policies, purchased through Life Company "A", needed to be paid on an on-going basis. The firm, however, continued its dissolution. The litigation sought a stay and damages, and was settled as follows: The firm agreed to pay the annual premium (to Life Company "A") for each partner into the future (certain and life payments). The firm assigned its future payment obligation to NABCO. The Settlement Agreement and Release allowed the firm to accomplish a novation and receive a complete release from the periodic payment obligation assigned. The firm was able to dissolve and the former partners' insurance is continuing indefinitely. Allstate is guaranteeing the future payment obligation of NABCO.
Property Damage Case
Two of our clients, a railroad and a London-based marine insurer, were involved in a situation where a barge broke loose from the tugboat that was pulling it and struck a railroad bridge. The railroad made a claim for property damages against the barge operator. The solution was found in a structured settlement through the use of a reinsurance agreement.
Physician v. Life Company and U.S. Government
In this case, a life company refused to pay medical payments to a plan doctor for alleged fraud. The federal government learned of allegations and suspended Medicare payments to the physician. The local press published the accusations. Later it was discovered that a clerical error on the part of the life company caused the entire problem - no fraud had taken place. By the time the situation was cleared up, the physician's practice was ruined. He went out of business and sued. An eight-figure cash settlement was offered and rejected because of AMT rules under which the physician would not get a deduction for attorneys' fees (one-third) and expenses. Because the physician would have to pay taxes on the full sum (not the net after fees and expenses), he would net, after tax, less than $500,000. Since he had been out of practice nearly ten years and would net so little, he could not accept the cash settlement. Taking interest in the case, a local congressman proposed a private bill to make this settlement tax free, but it did not pass. CCI worked out and proposed a structure that would pay the physician over a number of years and put him below the AMT threshold each year. In this way he is able to accept the settlement and net millions of dollars after taxes without any additional cost to the defendants.
Former General Counsel v. Fortune 500 Company
This case involved a dispute between management and General Counsel. CCI mediated the dispute and worked out a structured settlement in the form of deferred compensation using Allstate's PPA. We also did several similar cases for other executives.
Sports and Entertainment Agent Dispute with Fortune 100 Company
A sports and entertainment agent claimed breach of contract on the part of the company with which he placed entertainers for endorsements. A pre-suit settlement via structured settlement was negotiated by CCI.
CCI has handled thousands of cases of every type and size. This page features case studies taken from actual cases in our files. Names will always be redacted or fictitious in order to protect the confidentiality of the parties. A party's real name is only used if we have requested and received permission to do so in writing.