Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews

AZ Judge DENIES Genex Capital Motion 4 Reconsideration, Favors Structured Settlement Investors

by Structured Settlement Watchdog

In a June 9, 2022 under advisement ruling, the Court found that the Keefer (couple that invested in payments that Genex Capital confiscated in 2020) Plaintiffs are entitled to a declaration that they are the owners of and have the right to receive payments arising from the Payment Streams and that Genex has no material right, title, or interest in the Keefers’ Payment Streams.

The Court further reasoned that although the  RPA (Genex Receivables Purchase Agreement) is clear regarding the Keefers’ interest in the Payment Streams, the RPA is equally clear regarding restrictions on reassignment. Section 3.4 of the RPA states: “Buyer shall not have the right to further assign or sell the Receivable and must keep the Receivable for the balance of its term unless otherwise expressly approved by Genex.” Statement of Facts, Ex. 1, RPA § 3.4. The Court found that Genex is entitled to a declaration that the RPA does not permit reassignment of the Receivables without Genex’s consent, but DENIED all other relief.

Following the June 9, 2022 under advisement ruling, Genex Capital requested reconsideration of the ruling. On September 1, 2022, AFTER consideration of the Genex Capital motion and the response to that motion by the Keefer's, the Maricopa County Judge Danielle Viola has DENIED Genex Capital's Motion for Reconsideration.

There is a lot at stake, not just for the Keefers, who were the first investors to sue Genex Capital. There are other investors who have similar actions against Genex Capital in the consolidated Arizona litigation, who also had their payments confiscated by Genex Capital who were added to the complaint in December 2020 and others in February 2021.

Legal Battles with Investors Who Bought the Confiscated Payments Ahead?

A whole new set of investors that out there that BOUGHT payment streams that Genex Capital confiscated from original investors like the Keefers, although we ahve not found any pleadings against Genex.  

Why Investors in Others' Structured Settlement Payment Streams Need to Pay Attention 

The consolidated Arizona litigation is an important one to watch for anyone thinking about investing in structured settlement payment streams. It underscores that such investments are not annuities, have a higher risk profile than annuities, do not have the same statutory protections as annuities in 37 states (and counting) and should not be confused with annuities no matter what the marketing materials and websites the vendors of such investments may maintain.

Sometimes duck logic makes sense. When it comes to investing in other people's structured settlements, even if it vaguely resembles a duck, it doesn't feel like a duck, or quack like a duck, it's just not a duck.

 

 

Genex Capital Structured Settlement Investors | Amended Complaint Alleges Genex & CEO Conspiracy/ Conversion of Investor Payments

by Structured Settlement Watchdog

Genex Capital Corporation, which was sensationally sued by two California retirees in October who had invested in factored structured settlement payment streams originated by Genex Capital, is now facing suits brought by additional investors as set forth in the Amended Complaint filed on December 22, 2020 in Superior Court in Maricopa County Arizona.  Roger Proctor, the CEO of Defendants, Genex Capital Corporation, a Delaware Corporation and Genex Strategies, a Canadian company, has been named as a co-defendant in the Amended Complaint. Plaintiffs are retirees who bought factored structured settlement payments as investments.  

Genex Capital is alleged to have taken the structured settlement payments that plaintiffs originally bought from Genex,  and then resold the payment rights to new investors, ostensibly raking in millions. The identities of the new investors are not known at this time, however it's seems only a matter of time. before the proverbial poop hits the fan. The Genex Capital Investor Lawsuits are a living breathing lesson for anyone thinking of investing in factored structured settlement payments. They are not annuities and have risks that you wouldn't have by investing in a legitimate annuity. 

Download Keefer Amended Complaint v Genex Capital et al. 12-22-2020

 RICHARD L. KEEFER and VICKI L. KEEFER, husband and wife; H.P., a married man; E. DWAYNE WALLS, a married man; and PANABCO, a partnership;
Plaintiffs, vs. GENEX CAPITAL CORPORATION, a Delaware corporation; GENEX STRATEGIES, INC., a Canadian corporation; ROGER PROCTOR and JANE DOE PROCTOR, husband and wife; HAPPY STATE BANK & TRUST COMPANY, d/b/a/ GOLDSTAR TRUST COMPANY, a Texas corporation; SECURITY TITLE AGENCY, INC., an Arizona corporation. Defendants.

I've created the following infographic to show my understanding (and to help readers get a better understanding) of the status of the litigation and my thoughts on the big picture, following my review of publicly filed documents. 

________________________________________________________________________________________________________________________________

"You shouldn't have to beg, borrow or steal" and you should not have to NEGOTIATE" - Roger Proctor CEO Genex Capital  March 15, 2010  Source: Genex Capital You Tube retrieved January 4, 2021. ________________________________________________________________________________________________________________________

Payment Rights From Structured Settlements Arising Out of These Cases Are Subject of Investor Lawsuit Against Genex Defendants

The Amended Complaint against Genex Capital, Genex Strategies, Inc and Roger Proctor et al. refers to factored structured settlement payment rights from cases involving original annuitants with the following surnames, that were allegedly converted by Genex Capital from Plaintiffs in Investor Group One and reassigned to as yet unidentified new investors who are referred to in the infographic as Investor Group Two:

• Perdun
• Miers
• Duran
• Power
• Martin
• Harrington
• McAdory
• Dacus
• Bender
• Tolentino
• Alamaraz
• Gibbons
• Diaz

The following are the Counts in the Plaintiffs First Amended Complaint against the Genex Defendants and Proctor

Count One         Breach of Contract     (Keefers and H.P. v Genex Capital)

Count Two         Breach of Implied Covenant of Good Faith and Fair Dealing  (Keefers and Mr. Oak v Genex)

Count Three      Enrichment                  (Keefers, H.P., PANABCO v Genex Capital )

Count Four         Conversion                  (All Plaintiffs v Genex Capital, Genex Strategies and Roger Proctor, the CEO of Genex Capital)

Count Five           Civil Conspiracy           (All Plaintiffs v Genex, Genex Strategies and Roger Proctor

Count Six            Aiding & Abetting         (All Plaintiffs v Genex Strategies and Roger Proctor)

Count Seven     Declaratory Judgment     (Keefers and H.P. v Genex Capital)

Count Eight        Declaratory Judgment      Walls and PANABCO v Genex Capital)

Plaintiffs seek a judgment against Defendants:

A. Awarding the Plaintiffs compensatory damages of no less than the full value of the Converted Payments at the date payment was wrongfully diverted, and Plaintiffs’ rights and interests in the Converted Payments were converted, by Genex and GSI;

B. pursuant to A.R.S. § 12-1831 et seq. and Rule 57, Arizona Rules of Civil Procedure, declaring:

• there is no enforceable Receivables Purchase Agreement between the Keefers and Genex;
• there is no enforceable Receivables Purchase Agreement between H.P. and Genex;
• to the extent there are fully executed and enforceable RPAs between the Keefers or H.P. and Genex, the Keefers and H.P. did not materially breach the RPAs when they reassigned and sold any of the Converted Payment Streams.
• to the extent there are fully executed and enforceable RPAs between the Keefers or H.P. and Genex, the Keefers and H.P. cured such alleged material breaches of the RPAs;
• regardless of whether there are fully executed and enforceable RPAs between the Keefers or H.P. and Genex, and regardless of whether the Keefers or Mr. P. materially breached any executed and enforceable RPA, Genex had no legal or equitable right to terminate the RPAs, or reassign and sell the Duran Payments, Perdun Payments, Non-Assigned Keefer Payments, or Diaz Payments to new third-party Investors, without notice to or consent by the Keefers or H.P.;
• the Keefers own the right to receive the Duran Payments, Perdun Payments, and the Non-Assigned Keefer Payments, H.P. owns the right to receive the Diaz Payments, and, pursuant to Investor Assignment Agreements between the Keefers or H.P. and Genex, Genex has not and cannot terminate the Keefers’ or H.P.'s rights in these payments;
• regardless of whether the RPAs allegedly entered between Thompson and Gibbons IRA and Genex are enforceable, and regardless of whether Thompson or Gibbons IRA materially breached any executed and enforceable RPA, Genex had no legal or equitable right to subsequently reassign, sell, or otherwise receive the Almaraz Payments or Outstanding Mier Payment, without notice to and consent by PANABCO and Walls; and,
• PANABCO owns and is entitled to receive the Almaraz Payments, and Walls owns and is entitled to receive the Outstanding Mier Payment.

C. pursuant to A.R.S. § 12-1801 et seq. and Rule 65, Arizona Rules of Civil Procedure, ordering:

• Genex be enjoined from reselling or reassigning Plaintiffs’ structured settlement payments described herein;
• Genex be enjoined from advertising for resale or reassignment Plaintiffs’ structure settlement payments described herein;
• Genex be enjoined from seeking to amend court orders related to Plaintiffs’ structured settlement payments described herein or from changing the mailing address for such payments from going to any person or entity other than to Security Title;
• GSI be enjoined from receiving or distributing any funds related to Plaintiffs’ structured settlement payments described herein;
• Genex be mandated to abide by the terms of the relevant Investor Assignment Agreements between Plaintiffs and Genex;
• Goldstar and/or Security Title be mandated to direct all future structured settlement payments described herein to Plaintiffs, as the rightful owners of such payments; and,
• Genex, GSI, Proctor, Security Title, and Goldstar be enjoined from engaging in any further conduct that would deprive Plaintiffs of their rights in the structured settlement payments described herein.
• awarding Plaintiffs punitive damages to the extent permitted by law, sufficient to deter Genex, GSI, and Proctor from engaging in the same or similar conduct to that described herein;

D. awarding Plaintiffs punitive damages to the extent permitted by law, sufficient to deter Genex, GSI, and Proctor from engaging in the same or similar conduct to that described herein;

E. awarding pre-judgment and post-judgment interest on any award of damages at the rate provided under Arizona law, from the date of judgment until paid in full;

F.  awarding Plaintiffs its attorneys’ fees and costs incurred in this action plus interest thereon, at the maximum rate permitted by Arizona law, from the date of judgment until paid in full pursuant to A.R.S. §§ 12-341, 12-341.01, 12-1840; and,

G.  in the event judgment is obtained by default, for Plaintiffs’ attorneys’ fees of $25,000.00 pursuant to Rule 55(b)(1), Arizona Rules of Civil Procedure, and for costs expended, plus interest on those sums, at the maximum rate permitted by Arizona law, from the date of Judgment until paid in full;

H. the continuing jurisdiction of this Court to review and determine the reasonableness and award of any post-judgment costs and attorneys’ fees sought by Plaintiffs, pursuant to Rule 54, Arizona Rules of Civil Procedure

Plaintiffs allege:  (Note: the numbers refer to the line in the Pleadings of the Amended Complaint in Keefer et al v Genex et al. captioned above"
200. The Keefers rightfully own the Converted Keefer Payments.
201. H.P. rightfully owns the Converted H.P. Payments.
202. PANABCO rightfully owns the Converted PANABCO Payments.
203. Through its unlawful and unauthorized sale and re-assignment of the Converted Payment Streams to third-party Investors, Genex has intentionally exercised control over the Converted Payment Streams to the exclusion of the Keefers, H.P., and PANABCO.

The Keefers, H.P., and PANABCO have demanded Genex return control over the Converted Payments to the Keefers, and Genex has failed to do so.
205. The Keefers, H.P., and PANABCO have been damaged by Genex’s conduct in the minimum amount of the full value of the Converted Payments that Genex wrongfully took from each of them.
206. Upon information and belief, Proctor, in his capacity as Genex’s CEO, had personal knowledge of Genex’s transfer, sale, and reassignment of the Converted Payments to third-party Investors, without notice to or consent by the Keefers, H.P., or PANABCO.
207. Upon information and belief, Proctor, in his capacity as Genex’s CEO, supervised, managed, directed, and participated in and benefitted from Genex’s transfer, sale, and reassignment of the Converted Payments to third-party Investors. 

208. Mr. Walls rightfully owns the Outstanding Mier Payment.
209. Through its unlawful and unauthorized direction to Security Title to withhold the Outstanding Mier Payment, Genex has intentionally exercised control over the Outstanding Mier Payment to the exclusion of Mr. Walls.
210. Mr. Walls has demanded Genex return control over the Outstanding Mier Payments to Mr. Walls, and Genex has failed to do so.
211. Mr. Walls has been damaged by Genex’s conduct in the minimum amount of
the full value of the Outstanding Mier Payment.
212. Upon information and belief, Proctor, in his capacity as Genex’s CEO, had personal knowledge of Genex’s direction to Security Title to withhold the Outstanding Mier Payment, without notice to or consent by Mr. Walls.

213. Upon information and belief, Proctor, in his capacity as Genex’s CEO, supervised, managed, directed, and participated in and benefited from Genex’s direction to Security Title to withhold the Outstanding Mier Payment.
214. As a result of Genex’s, GSI’s, and Proctor’s intentional misconduct, Plaintiffs are entitled to punitive damages in an amount sufficient to deter Genex, GSI, and Proctor from engaging in conduct similar to that described herein.

216. Upon information and belief, Genex and GSI agreed to work together to divert
the Keefers’ ownership, rights, and interests in the Converted Keefer Payments, which the Keefers had already purchased from Genex for good and valuable consideration, and reassign and sell the Keefers’ rights and interests in the Converted Keefer Payments to third-party Investors, thereby depriving the Keefers’ of their rights and interests in the Converted Keefer Payments.
217. Upon information and belief, Genex and GSI agreed to work together to divert
the H.P. ownership, rights, and interests in the Converted Pak Payments, which the P's had already purchased from Genex for good and valuable consideration, and reassign and sell the H.P. rights and interests in the Converted H.P. Payments to third-party Investors, thereby depriving H.P. of their rights and interests in the Converted H.P. Payments.
218. Upon information and belief, Genex and GSI agreed to work together to divert
PANABCO’s ownership, rights, and interests in the Converted PANABCO Payments, which PANABCO had purchased for good and valuable consideration, and reassign and sell the PANABCO’s rights and interests in the Converted PANABCO Payments to third-party Investors, thereby depriving depriving PANABCO of its rights and interests in the Converted PANABCO Payments.
219. Upon information and belief, Genex and GSI agreed to work together to divert
Mr. Wall’s ownership, rights, and interests in the Outstanding Mier Payment, which the Mr. Walls had purchased for good and valuable consideration, and direct Security Title to withhold the Outstanding Mier Payment from Mr. Walls, thereby depriving Mr. Walls of his rights and interests in the Outstanding Mier Payment

220. Genex and GSI accomplished such diversion, reassignments, and sales by instructing Security Title and/or Goldstar to make payments to GSI, rather than to the Plaintiffs.

221. Genex’s and GSI’s agreed upon acts constitute conversion of the Plaintiffs’ property and are unlawful.
222. Upon information and belief, Proctor, in his capacity as Genex’s CEO and otherwise, had personal knowledge of Genex’s and GSI’s agreed upon conversion of the Plaintiffs’ property.

223. Upon information and belief, Proctor, in his capacity as Genex’s CEO and otherwise, supervised, managed, directed, and participated in and benefitted from Genex’s and GSI’s agreed upon conversion of the Plaintiffs’ property.

224. Plaintiffs have been damaged by Genex’s, GSI’s, and Proctor’s conspiracy to unlawfully redirect and convert the Converted Payments purchased by and owed to Plaintiffs in an amount to be proven at trial.
225. As a result of Genex’s, GSI’s, and Proctor’s intentional misconduct and conspiracy, the Plaintiffs are entitled to punitive damages in an amount sufficient to deter Genex, GSI, and Proctor from engaging in conduct similar to that described herein.

Has Investor Group Two Been Informed by Genex Capital, Genex Strategies, Inc. and Roger Proctor?

At this stage it is unclear whether or not the as yet unidentified investors from Investor Group Two were notified of the origin of the payments (1) at the time Genex sold them to the investors that make up Investor Group Two, or (2) when the Keefer's filed suit in October, or (3) whether they will be notified and when, now that the Amended Complaint has been filed.  How many more investors are out there? We shall see.  Stay tuned.

"You shouldn't have to beg, borrow or steal" and you should not have to NEGOTIATE"  Roger Proctor CEO Genex Capital

 

 

"Retread Carefully" JD Supra Article About Genex Capital Imbroglio with Investors and Intermediaries

by Structured Settlement Watchdog

A Matter of Public Interest to Investors in Structured Settlement Payment Rights and Those Advising Them

Two senior partners of the Philadelphia law firm of Cozen O' Connor PC, have weighed in on the Genex Capital imbroglio with investors in structured

"Retread Carefully"

settlement factored payment streams and intermediaries. Their commentary underscores that the Genex Capital lawsuit is a matter of public interest to investors or potential investors in structured settlement payment rights.  In addition to JD Supra the Cozen partners' commentary appears on the Lexology website.

_______________________________________________________

Maricopa County Superior Court

CV2020-00495 Genex Capital Corporation v NEAA et al
CV2020-013796 Keefer v Genex Capital Corporation, Genex Strategies, Inc., et al.

__________________________________________________________________________________________

The Michael Miller and Stephen R. Harris authored post says that " sometimes these transactions are called “retreads. And for good reason. The downstream investors, who are often unsophisticated non-accredited individual investors, may be left with no actual rights to the annuity payments and instead may be simply unsecured creditors of the factoring company — in which case these downstream investors are hoping and depending on the good faith and solvency of the factoring company to make good on these payments".  [ Miller, Harris  “Retread” Blowouts Create Hazards for Investors ]

"The defendants have responded to the allegations, and one of them also moved for a preliminary injunction to prevent Genex from reassigning these payment streams that they say are already owned by the downstream investors. Much to the chagrin of the defendants and the investors, however, the preliminary injunction motion was apparently filed too late — because, according to recent court filings, in response to the defendants allowing the periodic payment streams to be resold, Genex allegedly did the same thing (i.e, resold or assigned the periodic payment streams to other investors). Thus, each of the structured settlement payment streams has now gone from the payee to Genex; from Genex to the investor; and then from the investor to another investor. And now, Genex has allegedly sold or assigned those same payments to yet a different investor!" [ Cozen,  Ibid]

Miller and Harris  say that "the Genex cases confirm the potential hazards faced by individual investors who buy “retreads.” They say that investors run the risk that they will be deemed to be merely unsecured creditors with no actual annuity rights. Further, as the Keefers learned the hard way, if they seek to resell the payment rights they think they bought, a lot of bad things can happen, including (as they allege) the disaster scenario where the seller declares they are in breach and decides to again sell the same payment rights (whatever they are) to yet another investor".  [Ibid.]

Is There a Circular "Firing Squad" in the Future Between Two Sets of Investors With Genex Capital in the Middle? 

Quotable quote from the Genex Capital Receivables Purchase Agreement [Ver4 RPA 7-12  p 8 paragraph 8.5  Genex Complaint Exhibit B]

"This Agreement may be amended, modified, superseded or canceled only in writing signed by each party. Notwithstanding the foregoing, Genex may amend this Agreement or the Buyer’s Guide by giving Genex at least 30 days’ Notice of any such amendment. If Buyer continues to purchase Annuities or otherwise deal with Genex after the effective date of any amendment, Buyer will be deemed to have accepted the amendment and will be bound thereby".  (emphasis added)

 

 

 

 

Structured Settlement Investors Sue Genex Capital Corporation and Genex Strategies, Inc., Allege Conversion and Resale of Their Payments

by Structured Settlement Watchdog

Two investors have sensationally sued Genex Capital Corporation and Genex Strategies, Inc. in a lawsuit that presents a stunning example of the transactional

Seniors are suing Genex Capital (note this image is not of the Keefers)

risks of investing in factored structured settlement payment streams that are wildly different from real annuities. The investor plaintiffs are a husband and wife from Oceanside California in their late 60s.

The 7 count Complaint in the matter of RICHARD L. KEEFER and VICKI L. KEEFER, husband and wife, Plaintiffs, vs. GENEX CAPITAL CORPORATION, a Delaware corporation; GENEX STRATEGIES, INC., a Canadian corporation; HAPPY STATE BANK & TRUST  COMPANY, d/b/a/ GOLDSTAR TRUST COMPANY, a Texas corporation; SECURITY TITLE AGENCY, INC., an Arizona corporation. filed October 29, 2020 in Maricopa County Superior Court CV2020-013796, alleges:

• Breach of Contract v Genex Capital Corporation
• Breach of Implied Covenant of Good Faith and Fair Dealing vs Genex Capital Corporation
• Unjust Enrichment vs Genex Capital Corporation
• Conversion vs Genex Capital Corporation
• Aiding and Abetting v Genex Strategies, Inc.
• Civil Conspiracy vs Genex Strategies, Inc.
• Declaratory Judgment v Genex Capital Corporation

According to the Complaint against Genex et al, filed by Plaintiffs on October 29, 2020 in Maricopa County Superior Court in Phoenix, Arizona:

1. The Keefers purchased structured settlement payments from Genex Capital in a series of 10 transactions beginning on September 12, 2012 and ending on January 21, 2013. The factored payment streams were acquired through both their IRAs and in their individual capacities. Each purchase was evidenced by an Investor Assignment Agreement signed by Genex's principal and CEO Roger Proctor, a Canadian businessman from Vancouver.
2. Each Investor Assignment Agreement is signed an dated by Genex and contains language confirming the Investor has paid good and valuable consideration, “the receipt and sufficiency of which is hereby irrevocably acknowledged,” has been paid by the Investor in exchange for the assignment of the structured settlement payment rights.
3. Each Investor Assignment Agreement provides for the assignment of “all of [Genex’s] right and interest it may have” in specific structured settlement payments.
4. The Keefers subsequently assigned certain payments to New England Annuity Associates which then reassigned the payment rights to new investors.  paperwork was submitted to the servicing agent, Security Title and until February 2020  Security Title honored the reassignments to the new investors without delay or objection.
5. On or about February 3, 2020, Genex improperly redirects the Keefer Assigned Payments  to Genex Strategies, Inc., and erroneously alleges the Keefers are in default of a " Receivables Purchase Agreement" for assigning two sets of payment streams to New England Annuity Associates.
6. Plaintiffs allege upon information and belief, that Roger Proctor, in his capacity as Genex's CEO, had supervised, managed and participated in Genex's  direction to Security Title to remit payments that Genex had previously assigned to the Investors (including the Keefers), directly to Genex Strategies, Inc, rather than the investors who had already purchased the payments from Genex.
7. On or after February 24, 2020, Genex sent a notice of default to Richard Keefer alleging that his re-assignment of Perdun payments to NEAA violated the terms of a Receivables Purchase Agreement allegedly entered into between Keefer and No fully executed copy of the RPA was provided. The default letter purported to give Keefer 20 days to cure the alleged default by reversing the assignment.
8. Certain of the Keefer Assigned Payments which the Keefers never reassigned to NEAA, or any third party Investor, cease. At the time of the Complaint $32,456.48 has not been received.  Genex never provided notice of default relating to the Non Assigned Keefer Payment that ceased.
9. Upon information and belief, Genex subsequently sold and reassigned the structured settlement payment rights which belong to and are owned by the Keefers, including but not limited to the Perdun Payments, Duran Payments, and Non-Assigned Keefer Payments (hereinafter, the “Converted Payments”) to third-party Investors.
   
10. Genex has not turned over or paid any portion of the purchase price or proceeds it received from the new Investors for the Converted Payments to the Keefers
11. Genex did not notify the Keefers that Genex planned to convert their structured settlement future payment rights, treat those payment rights as its own, re-sell them to new third-party Investors, and keep any or all of the proceeds of its sale of the Converted Payments.
12. Upon information and belief, Genex effectuated the purported sale and reassignment of the Converted Payments by notifying the annuity issuers named in each of the state court approval orders to re-direct and remit the Converted Payments provided for each court order to Goldstar, rather than to Security Title.
13. Although Genex may have signed documents purporting to transfer, sell, and re-assign the Converted Payments to new third-party Investors, and then accepted payment from those third-party Investors, Genex did so without right, title, or interest in the Converted Payments.
14. Genex did not have the authority, right, or permission to sell and re-assign the Converted Payments which belong to and are owned by the Keefers.
15. Genex did not and does not have the authority, right, or permission to keep all or any of the proceeds of the sale of the Converted Payments.

Who Were the Other Investors Whose Bought From Genex, the Payments that the Keefers Have Alleged Were Converted by Genex

One wonders how many investors bought "Assured Annuities" from Genex Capital since March 2020 and how many of them were reassigned from payments that are in dispute? Given the very serious allegations against Genex, line 95 of the complaint alleges "Although Genex may have signed documents purporting to transfer, sell, and re-assign the Converted Payments to new third-party Investors, and then accepted payment from those third-party Investors, Genex did so without right, title, or interest in the Converted Payments", if you have purchased investments from Genex Capital, between then and now, perhaps it would be wise to closely examine the transactions, particularly the original court orders. Look for payments to original annuitant surnames Perdun. Duran, Dacus, McAdory, Tolentino and Bender.

Did Genex Confiscate Any Other Investors' Payments?

I included a small but highly relevant (in my opinion) excerpt of a 2020 version of the Genex Capital RPA (which bears the notation "Version date February 18, 2020"), in my July 30, 2020  Genex Capital 2020 Receivables Purchase Agreement | Think You're Buying An Annuity? Think Again.

The Version date of February 18, 2020 is notable in that it is 15 days AFTER the February 3, 2020 date where the Keefer Complaint alleges "Genex improperly redirects the Keefer Assigned Payments to Genex Strategies, Inc., and erroneously alleges the Keefers are in default of a 'Receivables Purchase Agreement' for assigning two sets of payment streams to New England Annuity Associates and the aforementioned Keefer Assigned payments were stopped to the Keefers.

Then and now, in my opinion, yield starved buyers contemplating buying structured settlement payment rights as investments in their retirement plans should definitely pause before investing and see what they're getting into. Settlement planners should be guided accordingly before recommending these alternative non annuity investments to their clients. If you or your client have already bought a factored structured settlement payment stream via Genex Capital, your heirs could unwittingly lose their inheritance by reselling the inherited payment rights at the whim of Genex Capital CEO Roger Proctor if he chooses to "unreasonably withhold" approval. 

Who is Genex Capital? Who is Genex Strategies, Inc.?

Genex Capital Corporation is in the business of purchasing (originating) structured settlement payment rights in the structured settlement secondary market.  Genex then reassigns the future structured settlement payment rights to investors in the structured settlement secondary and tertiary markets.  Structured settlement buyers commonly use payments servicing companies such as Security Title to facilitate payment administration. Upon information and belief, Genex operates a number of lead generation websites such as StructuredSettlementQuotes.com, QuoteMeaprice.com and and also markets factored structured settlement payment streams since November 2013 through Assured Annuity, on which website great pains are taken to justify the use of the term annuity, even though in a 2017 Delaware court case Greenwald v Caballero Goehringer, the Court decided that what was being sold to fund a medical malpractice settlement was not an annuity, but a Genex Capital Receivables Purchase Agreement, from an annuitant in a California case having nothing to do with the case being adjudicated in Delaware. 

At various times Genex Capital has been referred to as a division of Genex Strategies and Genex Strategies, Inc., has been, and is at the time of posting, listed as an alternate business name of Genex Capital on its Better Business Bureau listing. 

Genex Strategies, Inc, is the registrant of the trademark Genex Capital according to the United States Patent and Trademark Office. Proctor notably sponsors an annual skinny dipping contest for the Wreck Beach Preservation Society in Vancouver, donating C$5 per tush in support of the nudist beach.

 

 

 

AZ Court of Appeals Denies Genex Capital Suit Against Customer For Cancel Just Hours After Signing

by Structured Settlement Watchdog™

Interesting Arizona Court of Appeal's decision involving two structured settlement factoring companies who competed for a lottery winner's lottery payment rights that is a chilling reminder to investors in lottery and structured settlement payment rights that "it ain't over until it's over". 

Genex Capital was apparently gazumped and sued the customer to assert what it claimed were its rights. Genex Capital lost in Maricopa County Superior Court [CV2012-009751 ] and then lost again on all points of its appeal.

Below is a bullet point excerpt from the May 13, 2014 published decision [No. 1 CA-CV 13-0043].

• Wallace Thomas, Jr. (Thomas) won a one million dollar prize from the Arizona Lottery (AZ Lottery) in October 2010. Thomas chose to receive his prize in twenty-five annual installments of $40,000. Several structured settlement companies subsequently approached Thomas and offered to pay him a lump sum in exchange for an assignment of the annuity payments (Lottery Payments). Thomas eventually negotiated both with Genex and Appellee, Woodbridge Structured Funding, LLC (Woodbridge), over such an assignment.
• On June 8, 2012, Thomas signed an agreement with Genex to assign his interest in the remaining twenty-three installments of the Lottery Payments in exchange for a lump sum payment of $428,148 from Genex. Later that day, however, Thomas emailed Genex to inform the company he wanted to cancel the agreement. Because Thomas did not receive a response to his email, on June 9, he  faxed Genex a letter stating that he was canceling the agreement in order to “pursue other funding.” Five days later, on June 14, Genex’s president (upon information and belief Roger Proctor)  left Thomas a voicemail that Genex did not accept Thomas’s rescission notice and asserted that Thomas “had no right to cancel” the agreement.
• Genex attempted to perfect a security interest in its rights to the Lottery Payments on June 19, 2012, by filing a Uniform Commercial Code (UCC) Financing Statement (UCC-1 form) with the Arizona Secretary of State.
• Meanwhile, Thomas and Woodbridge entered into a written agreement dated June 9, 2012, (Assignment Agreement) in which Thomas assigned to Woodbridge his interest in the remaining annual $40,000 payments, in exchange for a lump-sum cash payment of $430,000.
• Thomas and Woodbridge filed a complaint against the AZ Lottery and Jeff Hatch-Miller, the Director of the AZ Lottery on June 26, 2012, requesting a court order pursuant to Arizona Revised Statutes (A.R.S.) section 5-563 (2012), which provides that a person may assign a lottery prize only after filing an affidavit with the trial court and receiving an appropriate order from the superior court (Approval Action).
• On July 12, 2012, Genex filed a lawsuit alleging breach of contract by Thomas and tortious interference by Woodbridge with Genex’s contractual relationship with Thomas (Damages Action).
• Thomas and Woodbridge moved for summary judgment in the Approval Action on July 16, 2012. With the motion, Thomas submitted the statutorily required affidavit stating that he (1) was over the age of majority and of sound mind; (2) had not made the decision to
  assign and sell his interest in his lottery prize under any duress; (3) was capable of making decisions in his own interest and of assessing his own best financial interests; (4) had received independent advice regarding the financial and tax implications of this [Assignment Agreement]; and (5) understood the terms of the [Assignment Agreement], including the
  Agreement’s term that discounts the prize’s present value. Section 5-563.A.3(a) requires such an affidavit prior to a trial court’s approval of an assignment of lottery winnings. AZ Lottery did not oppose the motion. The trial court granted the motion for summary judgment and approved
  the Assignment Agreement on July 27, 2012.
  
  

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