All Rights Reserved. By entering your email, you agree to sign up for consumer news, tips and giveaways from ConsumerAffairs. During this experience he conceived the idea for a new kind of enterprise--a life insurance company that would combine the flexibility and innovation of a small firm with the marketing savvy, financial strength, and computer systems of a big financial institution. It moved that concern's headquarters from Dallas to Carmel. We have helped over 300,000 people with their problems. 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. Many of the cutbacks were accomplished by integrating Conseco's consolidated marketing, investment, and product development operations into the companies that it purchased. Newsletters: Get local news delivered directly to you, Chemic alum among NU's top hitters, outfielders. CNO Financial Group, Inc. (formerly Conseco, Inc. (from Consolidated National Security Corporation)) is an American financial services holding company based in Carmel, Indiana. The record establishes that Scott Bristol told North American's senior management that he had not resigned from Conseco when he started working at North American. Workers, 34 F.3d 1148, 1155 (2d Cir. Accordingly, we find no error in the district court's refusal to grant judgment as a matter of law on the unfair competition claim. Continued Expansion and Growth Through Acquisitions: Mid- to Late 1990s. 2003). Conseco asserts that Kevin Kattleman, Kevin Podner, and Scott Bristol all removed customer loan files-or copies of the files-from Conseco's offices. As Conseco headed into 1998, the company had a number of accomplishments under its belt. We value your privacy. Webb Agency, Inc. v. Commercial Standard Ins. 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. A due process violation occurs when the punitive damages imposed by the jury are grossly excessive. Most notably, Conseco's management decided to discontinue loan services in the subprime lending market. It also moved much of its Lincoln subsidiary from Kentucky. After only two years of college, however, Hilbert became restless. Get alerted any time new stories match your search criteria. However, we do not consider this offense to be "comparable" in either substance or magnitude-North American's actions were widespread and affected thousands of people, most without their knowledge, and involved confidential financial records. Innovative Beginnings in the Late 1970s and Early 1980s, Stephen C. Hilbert founded the company and guided its meteoric rise. 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. It determined that Conseco's lead sheets and documents in its loan files are trade secrets, but also determined that Conseco's customer lists and certain financial information are not trade secrets. Conseco's 1989 annual report boasted that it had eliminated 83 percent of the employees from one of its acquisitions. The deal proved disastrous after mobile home loan defaults and delinquencies piled up as the economy soured. Conseco subsequently severed its relationship with Merrill Lynch, which had handled Conseco's initial public offering. BMW of North America, Inc. v. Gore, 517 U.S. 559, 575, 116 S. Ct. 1589, 134 L. Ed. The only way to change mortgage servicers is to refinance your loan and move to a lender that services the loans they originate. These products are distributed through independent agents, career agents and direct to customers through television advertising and direct mail. By the end of 1987, Conseco's assets had grown to a whopping $3.4 billion, and its workforce had grown almost twenty-fold since 1984, to nearly 500. Its portfolio includes traditional life insurance, annuities and supplemental health coverage. Conseco stock hit a high of. Well, US Bank is the one we are refinancing with and the one saying they can't do it because it isn't clear.The problem with getting a hold of the other company is, they have went Bankrupt and are no longer a company. They may or may not get the point. St. James Press, 2000. Dec 17 2008. In order to continue acquiring new companies, Hilbert knew that he would have to find a new source of funding that was not linked to debt-burdened Conseco. Further, we are satisfied with the sufficiency of the evidence supporting the jury's award of punitive damages. It purchased Lincoln Income Life Insurance Co. and Bankers National Life Insurance Co. for $32 million and $118 million, respectively. In response, Conseco sent a copy of Mambretti's letter to North American with a request that North American "cease and desist" from taking and using information contained in Conseco's loan files. However, North American neither returned the stolen information nor discouraged its employees' use of Conseco's loan files and lead sheets. Id. The court rejected this argument noting that this was a geographic area where everyone knows everyone else, "and you simply need to `see and ask'" to identify customers. 1984). We remand this case to the district court for entry of an amended judgment consistent with this opinion. 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. Bet you are. For visitors with visual disabilities, access to this website, including our FICO Data Privacy Policy, is available through assistive technologies, such as BrowseAloud, JAWS, VoiceOver, Narrator, ChromeVox, and Window-Eyes. Rapid City, South Dakota. North American competes for individuals in the same market. Sys. (formerly Conseco, Inc. (from Consolidated National Security Corporation)) is a financial services holding company based in Carmel, Indiana. Sign up to receive our free weekly newsletter. P. 50(b); Martin H. Redish, 9 Moore's Federal Practice 50.41 (3d ed.2003). Well start sending you the news you need delivered straight to you. of Mo., Inc., 162 F.3d 991, 998 (8th Cir. Conseco is the nation's 26th-largest life insurance company. Who bought out Conseco Finance Servicing Corp? 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. Shearson Lehman Brothers advised Lincoln Income Life Insurance. 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). Your lender or insurer may use a different FICO Score than the versions you receive from myFICO, or another type of credit score altogether. Given North American's failure to comply "with Rule 50, our review is limited to `whether the record reflects an absolute dearth of evidentiary support for the jury's verdict.'" Is there a fee for closing a Chase bank account? The purchase created the biggest independent casualty/property agency in the state of Indiana. Accordingly, "a motion for judgment as a matter of law at the close of the evidence `preserves for review only those grounds specified at the time, and no others.'" If North American's net-profit theory had been conceived prior to trial, it would-and should-have asked for such an instruction. Emmenegger v. Bull Moose Tube Co., 324 F.3d 616, 619 (8th Cir. 2003)). Conseco endured a string of disparaging articles in major business journals in the early 1990s that questioned its integrity. Your situation isn't that uncommon, mortgage companies go out of business all the time and title companies are used to dealing with issues like these. Conseco Finance Corp. will be split up and sold for a total of about $1 billion. CCP's first acquisition was Great American Reserve Insurance Co. for $135 million. Although the two companies merged to form one holding company late in 1983, internal operations still reflected Hilbert's original concept. As Conseco increased its value and expanded its asset base, suspicions about its performance began to wane in 1993 and 1994. Consequently, we agree with the district court that the lead sheets and the information contained in Conseco's customer loan files constitute trade secrets within the meaning of the Missouri Uniform Trade Secrets Act.6. In an apparent bid to distance itself from past troubles, Conseco Inc. yesterday changed its name to CNO Financial Group Inc. Shareholders voted in favor of . Unlike a collection on your credit report, which simply notes delinquent payments, a lien prevents you from selling that asset until you have finished making the payments. Walsh, 332 F.3d at 1158 (quoting Rockport Pharm., Inc. v. Digital Simplistics, Inc., 53 F.3d 195, 197 (8th Cir. However, North American also introduced several new legal theories-related to damages-not distinctly articulated in its "Directed Verdict Motion." Id. Unsubscribe at any time. Conseco also asked that North American return all of the information that it had acquired from Conseco's former employees. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Not only did Conseco launch a major advertising campaign pushing the company as the 'Wal-Mart of financial services,' but it also sponsored the Indiana Pacers basketball team and the Conseco Fieldhouse, an 18,500-seat facility that opened in late 1999. A court hearing to consider approval of Conseco's disclosure statement _ a document designed to provide creditors enough information to evaluate whether to support Conseco's reorganization plan _ is scheduled to be considered by Judge Doyle March 14. Hilbert's company acquired Consolidated National Life Insurance Co. in August 1983. I hate where our stock price is, but I cannot control the market. 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. He received $8.8 million in pay and exercised stock options worth almost $30 million. Share & Print. The company then purchased Lincoln American Life Insurance Co. early in 1985 for $25 million. The purchase included Massachusetts General Life, Philadelphia Life, Lamar Life, and Wabash Life. Zachar, 363 F.3d at 74 (quoting Davignon v. Clemmey, 322 F.3d 1, 13 (1st Cir. The company operates on the market for middle-class Americans. For example, it avoided the many companies that in the 1980s had invested heavily in risky real estate and junk bonds. In recent years, Conseco has been one of the most successful insurance companies in the United States. After the jury returned a verdict against North American on each of the claims, North American filed several post-trial motions, primarily relating to the damage awards. How do i get a lien release from a company which no longer is in business? Consumers who financed a home purchase or refinance through Conseco Finance Servicing have been in for a wild ride since the company was sold in 2003. Other ventures included outdoor and indoor theaters in Indiana and Ohio. 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." Once a lead sheet is received in a branch office, the office manager then forwards it to a loan originator, who calls these potential customers to offer Conseco's financial services. 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. In viewing this evidence in the light most favorable to the verdict, we hold there is ample evidence supporting each element of an unfair competition claim. Upon emergence from Chapter 11, Conseco will be engaged exclusively in the insurance business, the company says. Throughout the 1980s Wall Street perceived Conseco as young and inexperienced. R. Civ. He also edits and writes articles for the IronSet blog where he shares his experiences. In fact, in October 1993 Hilbert formed Conseco Entertainment Inc., a holding company for Conseco's future entertainment investments. American Travellers offered long term care insurance, and Transport provided cancer insurance. It's their baby.'. Kattleman testified that he was uncertain as to exactly how the customer loan files came to be located in his office at North American. This site is protected by reCAPTCHA and the Google. 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." You already receive all suggested Justia Opinion Summary Newsletters. As noted by the district court, North American management knew that employees were working and being paid by both companies at the same time.12 Rather than undertake any investigation, corrective, or disciplinary action, it elected to use the dual employment as a "model" in other offices. CCP was then merged into Conseco, and Beneficial Standard Life Insurance and Great American Reserve Insurance, both subsidiaries of CCP, became subsidiaries of Conseco. 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. More details on software and accessibility are available at WebAIM.org. Conseco counters that while some of the information within these lead sheets can be harvested from these two sources, its proprietary computer program provides a unique depth of information that cannot be obtained from alternative sources and its loan files contain confidential customer information. However, when passing on a district court's determinations concerning the constitutionality of the punitive award, we use a de novo standard of review. Phone: Web: Category: Banks Conseco Finance ripoff business should not be allowed to go bankrupt Rapid City South Dakota *Consumer Comment: Conseco Finance Billing policies ..I have decided not to pay them another cent Business Rating: Rate this business 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. Williams v. ConAgra Poultry Company, (slip opinion August 6, 2004). Most persuasively, North American contends that the "exacting" nature and quality of proof needed for recovery of lost profits in Missouri required Conseco to prove net profits by introducing evidence "of the cost and expense of operating the business during these periods." 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. Over the next two years Conseco continued to gobble up insurance companies--it acquired eight in 1996 and 1997. P. 50 in its request for judgment as a matter of law and thus has not preserved this argument for appeal. Also, North American's senior manager, Wade Hershel, received faxes containing Conseco loan documents originating from Conseco's St. Louis branch office from loan originators with this clandestine dual-employment status. However, because of the significant variance between the large actual damage award and the resulting punitive award, we must consider the nature of North American's conduct and the harm suffered solely by Conseco. 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. 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. Importantly, the company had eliminated much of its debt burden by 1994. No Bank can refuse to close your deposit account and even loan account if you are repaying all dues with interest. North American competes for individuals in the same market. It's hard to . Conseco was one of the United States' fastest growing insurance companies right away. Get the news you need delivered right to you. 33. In addition, in 1992 the company paid $15 million for a 31 percent share of Chicago-based Eagle Credit Corp., an organization formed to provide financing to Harley-Davidson dealers and their customers. 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. The $1 billion bid pales in comparison to the $6 billion Conseco paid in 1998 for Green Tree Financial Corp., which became Conseco Finance. Conseco Bank Conseco, Inc. Business Management Mr. Paul Boeckman, National Sales Executive Contact Information Principal Mr. Paul Boeckman, National Sales Executive Customer Contact Mr. Paul. *UPDATE Employee: Conseco Financial no longer exists, Green Tree is owned by someone else 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. Termination of the agreement, however, created bank and accounting fees of about $36 million and spurred a Merrill Lynch analyst to downgrade the company's stock. 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. 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. On appeal, North American argues that the district court erred when it 1) submitted the unfair competition claim to the jury, 2) failed to grant judgment as a matter of law, 3) found that the compensatory award was supported by the evidence, and 4) allowed the punitive damage award to stand. Conseco reorganized and caught its breath in 1988. ", Conseco organizes these lead sheets according to color-the most promising are colored red, leads that are considered good are colored white, and merely decent leads are colored blue. Quite the contrary, North American encouraged others in its offices to replicate the St. Louis scheme, and designated its St. Louis office as a "model" to expand into other cities. "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 complement that holding company's subsidiaries, Security National of Indiana was established to develop and market new life insurance products and services. Also in 1992, CCP shelled out $600 million to acquire Bankers Life and Casualty Co., one of the nation's largest writers of individual health insurance policies. [9][10] Conseco's bankruptcy was the third-largest U.S. Chapter 11 filing at the time, after the bankruptcies of WorldCom Inc. and Enron. Mortgage Companies: Conseco Finance Corporation. The caller informed Mambretti that all of his personal financial information-which he had entrusted to Conseco-had moved with the loan originator to North American's St. Louis office. Conseco hopes to emerge as an insurance-only business. individuals with low credit scores. at 619, and we will not judge the credibility of the witnesses or weigh the evidence. Auto-suggest helps you quickly narrow down your search results by suggesting possible matches as you type. Kimzey v. Wal-Mart Stores, Inc., 107 F.3d 568, 576 (8th Cir. 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. James S. Cole of St. Louis appeared on the brief. Galdieri-Ambrosini v. Nat'l Realty & Dev. Mathias v. Accor Economy Lodging, Inc., 347 F.3d 672, 676 (7th Cir. Connect the dots for them, get a supervisor involved, etc. Terrence J. O'Toole of St. Louis appeared on the brief. 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.'" Vigoro contended that the names of 200 former customers constituted a trade secret. Falling stock prices did not completely hinder Conseco, and in 1999 Conseco acquired three health insurance marketing companies with plans to form a new subsidiary dedicated to supplemental health insurance distribution. All rights reserved. Conseco claimed the acquisition was a perfect fit, as both companies served the same target market, but many industry observers were skeptical, and Conseco's stock took a plunge. It turned out to be a bad deal for Conseco, and they were forced to sell to GE Capital in 2003. It began insurance operations in 1982 and became a public company in 1985. 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. State Farm Mut. If you have any questions or clarifications, you can also reach out to Conseco Finance Servicing Corp directly at: The challenge here is that your requests can be ignored, forgotten, or purposely mishandled. 3 of the Int'l Bhd. To help achieve this objective, Conseco formed a new limited partnership in early 1994, Conseco Capital Partners II, L.P. CCP II included 36 limited partners who had a combined investment potential of $5 billion to $7 billion. Principal Competitors: Metropolitan Life Insurance Company; New York Life Insurance Company; The Prudential Insurance Company of America. Copyright in this article as an independent work may be held by the author. SYDNEY (Reuters) - A consortium of private equity firm KKR & Co LP KKR. The Court, however, went on to note that " [w]hile these ratios are not binding, they are instructive. We find sufficient evidence of "malice or outrageousness" as defined by Missouri law to permit an award of punitive damages in this case. Mo. [14], In 2015 February, CNO Financial sold its Hyderabad-based India operations to Cognizant.[15][16]. 1994), aff'd in relevant part, 82 F.3d 785 (8th Cir. What's somewhat baffling is we haven't missed a [earnings] number. Conseco Finance became insolvent after it failed to make a $4.7 million payment that was due Dec. 4. 'This is what I love to do,' Hilbert proclaimed in the June 7, 1993, issue of the Indianapolis Business Journal. Therefore, Conseco established a proper misappropriation claim with regards to these fourteen loan files. In 1998 Stephen Hilbert received about $69.7 million in compensation. What happens to my money if the bank closed my account? 'After I made $19,000 my first year as a 19-year-old, I knew I didn't need a college education to make a good living.'. Entering the mid-1990s, Conseco was poised for continued growth. In addition to its insurance and financial management divisions, which accounted for more than 85 percent of Conseco's operations in 1993, the company was broadening its scope to include some nontraditional ventures. Later, at trial, he admitted they were working for both companies at the same time. However, a corporate defendant is required to pay punitive damages so long as the employees were acting within the scope of their employment. Mark S. Wasinger and John B. Morthland of Hannibal, MO appeared on the brief. Cir. 2d 1 (1991)). The auction for former Green Tree Financial in St. Paul, held Tuesday in Chicago, resulted in a Wednesday morning deal, according to news reports. There are several ways to get a Release of Lien if you originally financed your home with Conseco. In addition, Hilbert sought firms that had developed unique insurance and annuity products or had devised innovative distribution systems for their offerings. He slashed the aggregate workforce of the five companies he had purchased between 1985 and 1989, for example, from 850 to 450 by 1993. At the end of 1996 Conseco made two more acquisitions--American Travellers Corp. for $880 million and Transport Holdings, Inc., for $228 million. Conseco Finance, based in Minnesota, however, has been shut out of capital markets since August when it missed a multimillion-dollar payment to Lehman Brothers. Andrey is a coach, sports writer and editor. North American senior manager, Ken Keeler, provided rebuttal expert testimony, stating that the average-net profit on a loan was $2,100.4 Carrie Hiatt, a North American witness, further testified that approximately ten percent of certain Conseco leads resulted in funded loans. 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. All rights reserved. At trial, Conseco's evidence established that thousands of Conseco's lead sheets were in North American's possession, that employees worked simultaneously for both companies, that Conseco's loan documents were faxed to senior management at North American, and that employees from several of Conseco's offices had taken Conseco's loan documents to North American.3 Conseco offered expert testimony that approximately five percent of Conseco's lead sheets result in funded loans, each with an average-net profit per loan of $4,000. After the preliminary hearing, the district court entered a narrowly-tailored injunction. As to the third Gore guidepost, North American concedes there is "no precise cognate in Missouri criminal law," but attempts to use the Missouri commercial bribery statute, RSMo 570.150.1(3). 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. 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. Conseco was investing tens of millions of dollars into new entertainment-related projects late in 1993 and 1994, including some riverboat gambling proposals. Conseco President and Chief Executive Officer William J. Shea said that following approval of the disclosure statement by the court, Conseco will commence the solicitation of votes of its creditors for the approval of its Plan of Reorganization. A creditor may file a lien against you for any goods or services you contracted to purchase but failed to actually pay for. R. Civ. It also granted summary judgment in North American's favor as to solicitation of employees and participation in breach of fiduciary duty. This time, however, he was looking for seed capital to fund his business startup, Security National of Indiana Corp. In 1998 Conseco placed additional effort on building brand awareness. Conseco produced evidence that would allow a reasonable finder of fact to conclude that there was at least a threat of misappropriation of the trade secrets contained in these fourteen files. However, he speculated that as many as ten of these former Conseco customers could have switched their business to North American. Mr. Erb said that the buyers could sell off Conseco Finance's $2.9 billion credit card receivables portfolio and $6 billion . Therefore, Conseco established a second misappropriation claim in regard to those specific loan files copied by Podner just prior to his resignation from Conseco. [6] SNI bought Consolidated National Life Insurance Co. in 1983. 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.
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