On September 15, 2011, the defendants moved to dismiss the case. On March 12, 2012, the plaintiffs moved for class certification. On September 28, 2012, U.S. District Judge Barbara M. G. Lynn denied the motion to dismiss, except that she dismissed the UCL count subject to repleading within 21 days. On October 25, 2012, the defendants answered the amended complaint. On January 8, 2013, the judge set the jury trial to begin December 9, 2013. On July 9, 2013, she denied the plaintiffs' motion for class certification. On December 2, 2013, the plaintiffs moved for voluntary dismissal of the case, and the judge granted the motion.
The 8-K Report
On December 4, 2013, LPHI filed an 8-K (material event) report with the Securities and Exchange Commission. Here is the full text:
On December 3, 2013, Life Partners Holdings, Inc. issued a press release announcing that the plaintiffs in the case styled Turnbow v. Life Partners, Inc. (Case No. 3:11-cv-1030-M, 2013 U.S. Dist. Ct., N.D. Tex., Dallas Div.) have voluntarily dismissed their lawsuit. The dismissal follows the court's denial of a motion for class certification in the lawsuit.The Press Release
LPHI attached to the 8-K an eight-paragraph press release entitled "Plaintiffs Dismiss Lawsuit Against Life Partners," the fourth paragraph of which contains three sentences from Judge Lynn's July 9 order denying the plaintiffs' motion for class certification. Here are the third, fourth, and fifth paragraphs of the press release:
While the plaintiffs in the case could have appealed the denial of the class action or continued to pursue the case as individuals, they elected instead to voluntarily dismiss the case against the Life Partners defendants. A key allegation was that Life Partners' medical consultant used an unreasonable method of estimating life expectancies. However, this allegation was criticized by the Court as part of its 34-page order denying certification as a class action:
"Proof only of results does not address these factors. Nor could an after-the-fact analysis of the insured's deaths, in the aggregate, establish that LPI was unreasonable in using Dr. Cassidy when and how it did.... The Court is highly skeptical that an analysis of results alone could lead a reasonable juror to determine that Dr. Cassidy's methods were flawed."
Life Partners CEO Brian Pardo commented, "This is yet another example of attorney-driven litigation which damages the entire economy, not to mention the companies that are the targets of such litigation. We are very pleased that the plaintiffs decided to walk away from this case and we hope to see other similar cases end the same way."General Observations
The sentences LPHI quoted are from page 11 of Judge Lynn's 34-page memorandum opinion and order. The first sentence quoted was the final sentence of a nine-sentence paragraph. The second sentence quoted was the first sentence of the next paragraph, which was a four-sentence paragraph. The third sentence quoted was the third sentence of that four-sentence paragraph. I think LPHI selected the three sentences to serve its purposes.
Moreover, I think it is inappropriate for a public company to use a press release about the results of a court case as a vehicle for expressing the chief executive officer's personal opinions about the court system. It is also ironic when the chief executive is known as litigious.
I think readers must examine for themselves the extent to which the three sentences quoted were judiciously selected. For that reason, I am making the 34-page memorandum opinion and order available as a complimentary PDF. Send an e-mail request to email@example.com for Judge Lynn's order.