Conseco (though not its subsidiary insurance companies) entered Chapter 11 reorganization in 2002 and emerged nine months later in 2003. Furthermore, Conseco takes reasonable steps to ensure the secrecy of these files. Observers now say Green Tree's problems should have been obvious when Conseco, under the leadership of its co-founder Stephen Hilbert, bought it. Conseco's troubles began two years ago, in what some say was a foreshadowing of Enron and other celebrated collapses. North American competes for individuals in the same market. As such, the district court abuses its discretion in permitting a punitive damage award to stand when the award is so disproportionate to the factors relevant to the size of the award that it reveals "improper motives or a clear absence of the honest exercise of judgment." Answer some questions about your specific lien and let us help you craft a letter to your creditor to resolve the issue. 29 Apr 2023 07:27:58 Copyright in this article as an independent work may be held by the author. Green Tree's balance sheet "was a disaster in. The plan is the. In 1987, it added Western National Life Insurance to its portfolio at a cost of $262 million. 1995) (quoting Cortez v. Life Ins. No matter what type of lien release it is that you need help with, whether, on a property, vehicle, unpaid taxes, or more, DoNotPay is the legal expert that you can rely on. And, one of North American's senior managers, Carrie Hiatt, knowingly authorized Rick Lasek to work in North American's Des Moines office while Lasek was still employed by Conseco, There was evidence of wrongdoing in several North American locations including: St. Louis, Missouri; Collinsville, Illinois; Springfield, Illinois; Wichita, Kansas; Davenport, Iowa; Colorado Springs, Colorado; and Overland Park, Kansas, North American's senior manager in charge of the company's expansion into the subprime market, Ken Keeler, received compensation based on loan production. If the Rule 50(a) motion is denied and the case is submitted to a jury, the movant must renew the motion once again in order to preserve the issue for appeal. Each account takes a certain monthly fee in order to be maintained but the good news is that if you choose to close it yourself, it is free. Conseco Inc., Carmel, Indianapolis, has sold its finance subsidiary, Conseco Finance Corp., in a Chapter 11 sale that culminated March 5 in a winning bid of $1 billion. However, the rules are such that "`technical precision is not necessary in stating grounds for the motion so long as the trial court is aware of the movant's position.'" Consequently, he was employed by both companies during this two week period. However, the jury (and the district court) rejected this theory, opting for an alternative explanation-North American's desire to expand into the subprime market, at any cost.14 North American has not shown that the jury's assessment of the facts was unreasonable. In arguing that the lead sheets are not "trade secrets," North American principally relies on Vigoro Indus., Inc. v. Cleveland Chem. The company, after 20 years in business, had grown tremendously--Conseco's total managed financial assets expanded from $8.2 billion in 1988 to $87.2 billion a decade later. Hilbert told the Indianapolis Star and News, 'Everything at Conseco is hitting on all cylinders except the stock price. Just as he had done to sell encyclopedias in the mid-1960s, Hilbert started knocking on doors in the late 1970s. Therefore, in 1990 Hilbert organized Conseco Capital Partners (CCP), a limited partnership that included several well-financed companies. The company said it would divest of non-core assets, and it sold seven percent of its stock to private investment firm Thomas H. Lee Company for $478 million. Conseco Finance became insolvent after it failed to make a $4.7 million payment that was due Dec. 4. Conseco Finance (Financial Services) is a financial advisory firm in Tempe, Arizona. They also bought life insurance company Colonial Penn later that year, changing their name to Conseco Direct Life,[8] though changing the name back to Colonial Penn in 2001 (known as Bankers Conseco Life Insurance Company in New York state). Servicing Corp. v. North American Mortgage Co., 24 Fed.Appx. Conseco Finance P.O. Conseco Fin. They pointed to the company's relatively low net worth, which was equal to only two percent of its total assets in 1991. at 435, 121 S. Ct. 1678. Some analysts believed that it was just a matter of time before Conseco would fall prey to the asset devaluation that had plagued other fast-growing insurers of the 1980s. 1995)). (formerly Conseco, Inc. (from Consolidated National Security Corporation)) is a financial services holding company based in Carmel, Indiana. This financial advisor is listed on Financial Advisory Firms under Financial Advisory Services - Financial Services. Conseco also filed a motion for a temporary restraining order prohibiting certain North American employees from taking, using, or disclosing documents from Conseco's loan files, and to return any information taken from Conseco's files. The district court upheld each of the awards, noting that North American's conduct was "widespread and systematic" and "reprehensible," and that the award was "not an injustice, but rather appropriate in light of the evidence." Go to the courthouse and find the trustee listed on the trust deed. The factors to be considered include "the degree of malice or outrageousness of the defendant's conduct, aggravating and mitigating circumstances, the defendant's financial status, the character of both parties, the injury suffered, the defendant's standing or intelligence, and the relationship between the two parties." On appeal, North American offers an eloquent and persuasive argument regarding the stringent requirements relating to the calculation of lost profits, particularly in relation to "net" profits. Rockport Pharm., Inc. v. Digital Simplistics, Inc., 53 F.3d 195, 197-98 (8th Cir. However, because North American failed to properly preserve the displacement question we need not decide the issue conclusively. 2003). ', As detractors waited for Conseco's money machine to disintegrate in the early 1990s, Hilbert clung to his original guiding principles. Conseco Finance Corp. accepted a bid to sell its $23 billion mobile home loan portfolio to a New York investment partnership and another piece of its business to General Electric's consumer lending unit, said Mary Beth Schwartz, a spokeswoman for Conseco Finance, based in St. Paul, Minn. Ark. Auto-suggest helps you quickly narrow down your search results by suggesting possible matches as you type. Stephen Hilbert demonstrated his confidence in the company by acquiring more than 638,000 shares in October 1999, pushing his total stake in Conseco to 10.4 million shares. R. Civ. Initially, we must determine whether Conseco's lead sheets and the information contained in its customer files constitute trade secrets under the Missouri Uniform Trade Secrets Act. Though this was significantly lower than his 1997 pay of $119 million, it was enough for Hilbert to retain his reputation as one of the highest-paid CEOs in the nation. He was raised in a small rural community near Terre Haute, Indiana, and attended nearby Indiana State University. We will not set aside the jury verdict unless there is a complete absence of probative facts to support the verdict. Id. In April 2014, it was ranked among the 50 most-trusted financial institutions in America by Forbes. It further found that Conseco was likely to succeed on its claims of misappropriation of trade secrets against North American relating to the actions of Podner and Kattleman, but not Bristol. In order to avoid this constitutional infirmity, the punitive damages award must be remitted to $7 million, an amount that is sufficiently punitive, but that does not violate notions of fundamental fairness. And, interestingly, much of the improper activity occurred after Conseco filed suit, further reflecting the reprehensibility of North American's actions. 1971) (stating that it is "generally held that an agent's malice is imputable to the corporation making the latter liable for malicious, willful or criminal torts of its agents or employees within the scope of their employment"). According to Missouri law, a "trade secret" is information-including but not limited to-technical or nontechnical data, a formula, pattern, compilation, program, device, method, technique, or process that derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use. Review the required documents based on the type of loan: 3. 'We are going to stay away from food and beverage.' Get matched with an Auto Warranty partner. Unsubscribe easily. Some of these former employees also expressed concern about Conseco's overall future financial performance. "This court has made it very clear that where the court submits a single damage question for multiple claims and where the evidence supports the actual damage award on any of the claims, the award will not be set aside." To meet these goals, Conseco in March agreed to acquire Green Tree Financial Corporation, a diversified financial services company that offered home equity and home improvement loans, financing packages for the purchases of recreational vehicles and equipment, and credit cards. 1150 (E.D. We find sufficient evidence of "malice or outrageousness" as defined by Missouri law to permit an award of punitive damages in this case. However, he speculated that as many as ten of these former Conseco customers could have switched their business to North American. Webb Agency, Inc. v. Commercial Standard Ins. Walsh, 332 F.3d at 1158. North American competes for individuals in the same market. Wendt is celebrated for his business acumen and for his bitter and very public divorce from his first wife, Lorna, several years ago. In early August 2000, Conseco sent a letter notifying North American's legal department of the misconduct by Scott Bristol and his loan originators and asking that it stop. The auction for former Green Tree Financial in St. Paul, held Tuesday in Chicago, resulted in a Wednesday morning deal, according to news reports. In 1998 Conseco hoped to continue its growth and strong financial performance. Earlier, in mid-1985, Lincoln had agreed to be acquired by I.C.H. The company collapsed under a huge debt load resulting from a rash of acquisitions in the 1990s, including the $6 billion purchase of Green Tree, the nation's largest lender to mobile-home buyers. We review the district court's denial of a motion for judgment as a matter of law de novo, applying the same standard as the district court. Conseco is a Delaware financial services company with its principal place of business in Minnesota. Thank you, you have successfully subscribed to our newsletter! The problems started in 1998 when the company bought Greentree Financial, a mobile and manufactured housing lender, in 1998. Box 6172 Rapid City, South Dakota U.S.A. In 2000, over the course of several months, a substantial number of Conseco's office managers and loan originators resigned, and many of Conseco's former employees took jobs working for North American. But when the company servicing the mortgage has been sold several times, it's hard to know where to go to demand the lien release. When Conseco went hunting for acquisition candidates, it looked for organizations with sound asset portfolios. Shearson Lehman Brothers advised Lincoln Income Life Insurance. In 1982, Hilbert acquired his first life insurance company, Executive Income Life Insurance Co., for $1.3 million. Its portfolio includes traditional life insurance, annuities and supplemental health coverage. The SEC said the plan could allow company officers and directors to be released from liability for possible past misconduct or negligence. Both motions were denied by the district court, and the case was submitted to the jury on Conseco's claims of unfair competition and tortious interference. We agree that both the lead sheets and the information contained in these customer files constitute trade secrets under the act. at 416-417, 123 S. Ct. 1513 (2003). Conseco stock hit a high of. Adherence to the rule is mandatory. As Conseco increased its value and expanded its asset base, suspicions about its performance began to wane in 1993 and 1994. The deal proved disastrous after mobile home loan defaults and delinquencies piled up as the economy soured. Appeal from the United States District Court for the Eastern District of Missouri, E. Richard Webber, J. Ann. In December of that year Hilbert's two holding companies were merged under the name Conseco, Inc. With about 25 employees and assets worth $3 million, Conseco substantially improved the performance of its two acquisitions during 1983 and 1984. Questions persisted, and in late 1999 Conseco announced plans to pare debt and slow growth. CCP was then merged into Conseco, and Beneficial Standard Life Insurance and Great American Reserve Insurance, both subsidiaries of CCP, became subsidiaries of Conseco. [citation needed], In 1986 Conseco acquired Lincoln Income Life Insurance Company for $29 per share or $32.3 mil. Rapid Growth: Mid-1980s Through the Early 1990s. These products are distributed through independent agents, career agents and direct to customers through television advertising and direct mail. The Fastest Way to Remove a Lien From a Title in Texas, How to File a Lien Release Form in Utah Quickly, How to Pay Your Houston Water Bills Online Hassle-Free, How to Remove My Case From The Internet Instantly, How to Recover Your Forgotten Workday Password Hassle-Free, Sending Money to an Inmate Has Never Been Easier, Credit Card Dispute Letter Template That'll Get Your Money Back, Finding out if there is a lien on your house, Finding out if there is a lien against you, Limitations of selling a car with an existing lien, Subscribing to free trials without being charged after, Skipping the queue when contacting customer service, Construction materials (for materials and labor). In short, we see sufficient evidence that North American misused Conseco's trade secrets to justify the submission of the unfair competition claim and the tortious interference claim to the jury. 'I dropped out to sell encyclopedias,' Hilbert explained to Barron's in 1991. In July 1996 Conseco bought Life Partners Group, Inc. for about $840 million. 1995)). Conseco reorganized and caught its breath in 1988. Many factors affect your FICO Scores and the interest rates you may receive. Conseco also presented evidence that in its Davenport, Iowa, office-after the filing of the lawsuit-the area manager, Rick Lasek, worked for both companies, copied thousands of Conseco lead sheets, sent them to North American, copied all of the HUD settlement statements from his office, and stated that his goal was to "put the mother [* * * *]ers [Conseco] out of business." Copyright 2003 by The National Underwriter Company in the serial publication. P. 50(b); Martin H. Redish, 9 Moore's Federal Practice 50.41 (3d ed.2003). Bristol also returned a number of documents at his deposition, in accordance with the district court's TRO. He earned a salary of $150,000 in 1999. CFN would pay $700 million for most of the operations of Conseco Finance, which employs 5,400 people. In September the company entered into a $344 million partnership with American Life Holdings, Inc., which included subsidiaries American Life and Casualty and Vulcan Life. Im going TO SAY THIS IN BIG BIG LETTERS.. __________________________________________________. No one seriously expects any of those to be repaid. As stated so eloquently-and simply-by Judge Posner of our sister circuit, "punitive damages should be proportional to the wrongfulness of the defendant's actions." Merrion Group analyst David Erb said CFN may have bought a lot of Conseco's asset-backed securities, which trade at steep discounts, and may plan a controlled liquidation of the firm once it gets bankruptcy protection. Who owns Wilco life insurance? Mathias v. Accor Economy Lodging, Inc., 347 F.3d 672, 676 (7th Cir. In fact, it experienced stellar growth during 1992 and 1993. What's somewhat baffling is we haven't missed a [earnings] number. If so, it should list the title company who handled it and you can reach out to them. Indeed, analysts familiar with Conseco's portfolios attested that the company's investments were much more liquid, of higher quality, and more conservative than those of most insurers. Conseco Sells GM Building, May Emerge from Bankruptcy by Mid-September, Conseco's Financial Condition Deteriorates, Some of Aprils most active scams have included taxes and Mothers Day, Wait til you see the Amazon price secrets someone just let out of the bag, Traveling this summer could be more expensive, but vacation experts say there are some ways around that, Bed Bath & Beyond coupons will be valid at The Container Store and Big Lots for the coming weeks, American Outdoor Products recalls Backpackers Pantry Blueberry Peach Crisp, Subaru recalls 4,400 model year 2023 Ascents with 20-inch wheels. However, we cannot allow the punitive damage award to stand at $18 million, and remit the award to $7 million. Additionally, Conseco produced evidence that Podner made copies of an unspecified number of customer loan files shortly before his resignation. The bankruptcy filing does not include Conseco's insurance operations, which regulators and the company insist are sound. Accordingly, North American concludes that there was insufficient evidence, absent proof of net profit, for any submissible cause of action to survive and requests that we overturn the jury verdict as a matter of law and enter judgment in North American's favor. Not only did the company's stock fall about 15 percent upon announcement of the acquisition agreement, but it continued to drop; from a high of $58.12 a share in April 1998, Conseco stock dropped to about $20 a share in late 1999. By the late 1980s, Conseco had accumulated about twice as much debt as equity. Conseco was one of the United States' fastest growing insurance companies right away. Continued gains in the value of Conseco holdings combined with the success of CCP investments resulted in dynamic growth during 1990 and 1991. It also granted summary judgment in North American's favor as to solicitation of employees and participation in breach of fiduciary duty. Aside from taking care of liens, and property taxes for you, here are other concerns that the worlds first-ever robot lawyer can assist you with: There's really not much DoNotPay can't do for you. We agree. The jury's $3.5 million compensatory award was issued by general verdict, after the jury returned verdicts for Conseco on two claims, unfair competition and tortious interference. Take out more than a certain amount, however, and the bank must report the withdrawal to the Internal Revenue Service, which might come around to inquire about why you need all that cash. How to reverse Diabetes Belly fat: The removal of Diabetes Michigan AG sues Bay Co. contractor who allegedly drained wetland, Mancino's GM accused of embezzling over $100,000, Larkin Township greenhouse to reopen as Rooted by Keits on Friday, Thousands gather for 37th Freeland Walleye Festival despite rain, clouds, MHS alum Krawczak 'oozing confidence' for T'wolves, Loons win 5 of 6 at Fort Wayne behind dominant pitching. State Farm, 538 U.S. at 425, 123 S. Ct. 1513 (citing Pacific Mutual Life Ins. By the end of the year the company's asset base had increased to $102 million. 33. In 1996 the company was named to the Fortune 500, and in 1997 Conseco was added to the S & P 500 Index. Conseco Finance Corp - Company Profile and News - Bloomberg Markets Bloomberg Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately. When Dwight Eisenhower gave the Atoms for Peace speech what constructive use of nuclear energy was he introducing? The Green Tree acquisition stirred up numerous questions, including whether Conseco had too much debt and whether Green Tree, which had a past of dubious accounting practices, was growing too rapidly--25 to 30 percent a year--and providing loans to high-risk borrowers. In addition, Conseco typically achieved significant efficiency gains by implementing advanced information and data processing systems. Do you have the closing paperwork (Final HUD-1 settlement statement) from that refinance? Finally, we turn our attention to the punitive damage award and consider the three distinct challenges raised by North American-whether the award was (1) against the weight of the evidence, (2) in violation of due process, and (3) grossly excessive. Are there fees for closing a bank account? Mo. Companies displayed may pay us to be Authorized or when you click a link, call a number or fill a form on our site. If you continue to use the site, we will assume that this suits you. However, the district court denied North American's summary judgment motion relating to misappropriation of lead sheets, documents in Conseco's loan files, unfair competition, and tortious interference with business relations. Aside from obtaining a Conseco Finance Servicing Corp lien release for you, DoNotPay can also answer your questions with regard to: Read further to find out everything you need to know about liens and how they can be removed either on your own or with the help of DoNotPay. Conseco's mortgage service division originates residential loans for individuals in the "subprime" lending market, e.g. So, we purchased a mobile home in 1997 and it was financed through Greentree Financial. It collected $5.6 billion in premiums last year and has 5.7 million policyholders. HOwever, DiTech said that they only acquired ACTIVE accoutns from Conseco and since it was closed prior to DiTech acquiring them, that they can't do anything about it. Thus, because Conseco received a large compensatory award in this case-$3.5 million-in the "absence of extremely reprehensible conduct against the plaintiff or some special circumstance" the large exemplary award cannot stand unmodified. Conseco . We do, however, make this procedural observation-North American failed to raise the issue of submissibility of the tortious interference claim in its directed verdict motion either at the close of Conseco's case or at the close of all evidence. 1969)). [11] In the process of reorganization, GreenTree was divested and thereafter Conseco solely focused on the insurance industry. Indeed, through possession of these loan files, Conseco is in a unique position of being able to analyze its customers' specific financial needs and identify those current customers who may need additional Conseco financial services. This time, however, he was looking for seed capital to fund his business startup, Security National of Indiana Corp. Many homeowners are, survey shows. 'I think you'd hear the same thing if you were talking to Bill Gates or anyone else who has achieved success. The $1 billion bid pales in comparison to the $6 billion Conseco paid in 1998 for Green Tree Financial Corp., which became Conseco Finance. When you finance a home purchase, you take out a mortgage, which is basically an IOU to the lender. Did Yamamoto really say the sleeping giant quote? In addition to avoiding real estate and junk bonds, Conseco's portfolio managers steered away from other risky and trendy investment vehicles of the 1980s, particularly Guaranteed Investment Contracts. For its first assignment of error, North American directs our attention to Conseco's unfair competition claim that is founded on North American's alleged misuse of Conseco's trade secrets.5 North American argues that the district court erred in its initial decision to submit this claim to the jury and then in its subsequent declination to grant a judgment as a matter of law. By entering your email, you agree to sign up for consumer news, tips and giveaways from ConsumerAffairs. Author: Wedgefield, South Carolina. Conseco Inc.'s money-losing consumer finance unit would be split into two pieces and sold for $1 billion under the winning bid in an all-night bankruptcy auction that concluded Wednesday. PRIVACY NOTICE: When you visit this website we collect your browsing activities on our site and use that information to analyze and research improvements to the website, and to our products and services. You can explore additional available newsletters here. The company operates on the market for middle-class Americans. Shane and J-Ville are on the money here for sure this is a responsibility of the Title Co. from the 2003 deal. It began insurance operations in 1982 and became a public company in 1985. Quick and easy. Copyright (c) 2022 Company-Histories.com. Removing a state tax lien from public record, What Is a Lien Release on a Car and What to Expect, How to Secure a Lien Release in Illinois Instantly, How to Secure a Vehicle Lien Release Immediately, How to Get a Capital One Lien Release Hassle-Free, 3 Easy Steps to Filing a Release of Lien Form In New Mexico, State Tax Lien Statute of Limitations In California Explained. We are further convinced that North American's net worth was not the sole consideration in the jury's punitive award. Removing a Lien on a Bankrupt Financial Institution, Re: Removing a Lien on a Bankrupt Financial Institution, Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002. Reproduced from National Underwriter Edition, March 10, 2003. Id. Conseco Sells Former Green Tree Finance Unit For $1 Billion, Life Health > Life Insurance > Term Insurance, March 09, 2003 at 07:00 PM Under the terms of the proposed plan, which the company says is consistent with the agreement in principle announced on Dec. 18, 2002, CNC will substantially reduce its debt and future annual interest expense. Later, at trial, he admitted they were working for both companies at the same time. We affirm in part and reverse in part. In addition, Hilbert sought firms that had developed unique insurance and annuity products or had devised innovative distribution systems for their offerings. To insure the confidentiality of these lead sheets, Conseco requires all employees to sign a form that acknowledges their receipt and understanding of the contents of Conseco's Employee Handbook. Similarly, an investment in a restaurant chain that featured buckets of spaghetti fizzled. The court also defined "readily ascertainable" to mean that the plaintiff did not spend a great deal of time or effort compiling that information. Targeting 'middle America,' or U.S. households with annual incomes between $25,000 and $75,000, Conseco's insurance products range from medical to life. Id. Are you wasting your Amazon Prime benefits? Zachar, 363 F.3d at 72 (quoting Correa v. Hosp. Such an objection7 is simply not sufficient to preserve, and certainly cannot be read to encompass, the legal theories underlying North American's Rule 50(b) motion and this appeal (submissibility of the claim). Well, Conseco took over the accounts from Greentree and then Conseco went Bankrupt as well, which was acquired by DiTech. As Conseco headed into 1998, the company had a number of accomplishments under its belt. Entering 1992, the company was valued at over $800 million. It is very important to do your own analysis before making any investment based on your own personal circumstances and consult with your own investment, financial, tax and legal advisers. See Mo. Its goals for 1994 included increasing its assets under management by 30 percent.
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