AG, Attorneys Debate Lead Paint Settlements
The Maryland attorney general’s office and attorneys for 100 people affected by lead-paint poisoning went head-to-head in a hearing on Tuesday (July 25) to decide who could get the lead-paint victims the restitution to which they’re entitled.
Both sides allege the victims were taken advantage of by Access Funding, a structured-settlement-factoring company based in Chevy Case, Maryland, saying that the company bought structured settlements from clients who had won those settlements in lead-paint lawsuits against former landlords.
The company had allegedly lured the individuals, many young and intellectually impaired, to get legal advice from an advisor on their payroll, leading the victims to agree to a lump sum payment worth pennies on the dollar compared with what they would have been awarded over time.
Access Funding acquired a gross total of $32.6 million in future payments for its customers between March 2013 and August 2015; however, at most, it doled out $7.5 million in cash to those customers, according to a complaint filed by the attorney general’s office last year.
Maryland Attorney General Brian E. Frosh announced his lawsuit in May 2016, and alleged that Access Funding used unfair and deceptive practices to convince the victims to sign over the bulk of their settlements in exchange for a one-time cash payment, in violation of the Maryland Consumer Protection Act.
Frosh is requesting that the court award restitution to the victims who were harmed by Access Funding's practices; impose civil penalties on Access Funding and its principals under the Maryland Consumer Protection Act; and declare void prior transfers of structured settlement payment rights.
However, a few months later, a separate lawsuit was filed by a number of attorneys individually representing victims of the alleged scheme.
|Maryland attorney general's office|
Attorney General Brian E. Frosh (pictured) announced his lawsuit in May 2016, and alleged that Access Funding used unfair and deceptive practices to convince the victims to sign over the bulk of their settlements in exchange for a one-time cash payment, in violation of the Maryland Consumer Protection Act.
Brian Brown, an attorney with Brown & Barron LLC, who is representing lead-paint victims, told the Baltimore Sun that during the discovery period in that case, it came to light that Access Funding did not have enough money to fully reimburse all the victims, so they worked out a payout option of $1.1 million, or roughly $7,500 per person.
The attorney general’s office asked for a six-month stay in those proceedings while its case moves forward.
Brown and the other attorneys are saying that their way is the way to go, because the full restitution is impossible and would “leave our clients with nothing in the real world,” Brown said. “It’s an impossible remedy to achieve.”
Ruth Ann Norton, president and CEO of the Green and Healthy Home Initiative, told the Sun that she doesn’t think Access Funding should get off the hook that easy.
“I’ve been somewhat troubled when plaintiffs attorneys tell their clients in the first place to accept offers from Access Funding,” she said. “I think Access Funding shouldn’t get a second bite of the apple. I think they have to be held accountable for the incredibly predatory practices that they have executed and families should be made whole.”
Access Funding’s attorney would not comment on the case.