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December 16, 2020

NY Court Denies FLA Structured Settlement Factoring Company Motion to Dismiss Fraud Complaint

by Structured Settlement Watchdog

Structured Asset Funding d/ba 123 Lump Sum has failed to dismiss the complaint in Philip Lape , Plaintiff v Structured Asset Funding, LLC d/b/a 123 LumpSum, Insurance Company of North America, and Life Insurance Company of North America, Defendants New York State Supreme Court County of Monroe Index E2020003377 filed May 26, 2020.  Download Lape v 123 LumpSum 2020-05-26 E2020003377 SUMMONS___COMPLAINT

Why the Lape v Structured Asset Funding/ 123 Lump Sum Lawsuit is an important case to watch

Opening the door bears fruit
The Monroe County decision in Lape v 123 Lump Sum "opens the door" and may bear fruit

In the context of structured settlement factoring, forum shopping generally involves the (1)the solicitation of customers, (2) introducing the fraudulent concept to its intended structured settlement payee victims in a state or jurisdiction with more strict regulations and enforcement (3) directly or indirectly coaching structured settlement annuitants into taking of elaborate steps leading to the purported establishment of "residence" in a state where they don't actually live, for the express purpose of selling structured settlement payments in a jurisdiction with less robust enforcement of its structured settlement protection act. Forum shopping has been used by as a "gateway drug" by structured settlement factoring companies to circumvent New York Courts and pillage its victims' structured settlement payments. 

The standard structured settlement factoring company playbook, evident by a number of legal cases, is to simply point the finger at the victim for participating in the fraud. 

Plaintiff's complaint in Lape, notably included screenshot copies of electronic communications from an individual then affiliated with the Defendants that presents some of the clearest written documentation of how this insidious practice goes down. Defendant claimed the Plaintiff's complaint "violated the Full Faith and Credit clause, the doctrine of res judicata and failure to join the necessary parties".

In December 15, 2020 decision by Monroe County New York Supreme Court Judge Ann Marie Taddeo JSC wrote, in denying the Defendant's motion to dismiss, 

"Plaintiff asserts that he is not seeking this Court to overturn the actions of the Florida Circuit Court, but rather, he seeks a novel finding of fraud and deceptive business practices. Accordingly, he argues, neither the full faith and credit clause nor the doctrine of res judicata applies. The Court holds that plaintiff has stated a claim for which relief can be granted in New York. In so ruling the Court does not opine on the strength of the Plaintiff's case".  Download E2020003377_Phillip_Lape_v_Phillip_Lape_DECISION___ORDER_ON_28

The Lape decision opens up a novel legal theory that has survived a motion to dismiss, as well as a possible avenue for any structured settlement payee to sue structured settlement factoring companies for fraud and deceptive business practices.  Forum shoppers beware!

Prior Posts on the Lape case

Fraudulent Scheme to Evade NY Structured Settlement Protection Statute by 123 LumpSum Says New Complaint   June 8, 2020

Lape v 123 Lump Sum | Insurer Moves For Interpleader  October 1, 2020

 

Posted at 11:59 AM in Albany New York Structured Settlements, Annuitant v Factoring Company, Bethesda Structured Settlements, Boca Raton Florida Structured Settlements, Boston Structured Settlements, Bowling Green Kentucky Structured Settlements, NYC Structured Settlements, Olean Structured Settlements, Orange County Structured Settlements, Oregon Structured Settlements, Owings Mills Structured Settlements, Sarasota Structured Settlements, Seattle Structured Settlements, Secondary Market Structured Settlements, South Carolina Structured Settlements, Staten Island Structured Settlements, Structured Asset Funding/123 Lump Sum, Structured Settlement Factoring, Structured Settlement Factoring News, Structured Settlement Transfers, Structured Settlement Watchdog®, Structured Settlements in Ithaca New York area, Structured Settlements in Nassau County, NY, Structured Settlements New York, Suffolk County Structured Settlements, Syracuse Structured Settlements, West Virginia Structured Settlements, Westchester Structured Settlements, White Plains Structured Settlements, WV Structured Settlements |

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