Benacquisto, et al v. American Express Fin, et al

Filing 454

ORDER granting 429 Motion to Enforce Settlement (Written Opinion). Signed by Senior Judge David S. Doty on 8/13/2012. (PJM)

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 00-1980(DSD/JMM)
Lesa Benacquisto, Daniel
Benacquisto, Richard Thoresen,
Elizabeth Thoresen, Arnold
Mork, Isabella Mork, Ronald
Melchert and Susan Melchert, on
behalf of themselves and all
others similarly situated,
Plaintiffs,
ORDER

v.
American Express Financial
Corporation, American Express
Financial Advisors, American
Centurion Life Assurance
Company, American Enterprise
Life Insurance Company,
American Partners Life
Insurance Company, IDS Life
Insurance Company and IDS Life
Insurance Company of New York,
Defendants.

This matter is before the court upon the motion to enforce
settlement

by

(Ameriprise).

defendant
Based

on

Ameriprise
a

review

Financial
of

the

Services,

file,

record

Inc.1
and

proceedings herein, and for the following reasons, the motion is
granted.

1

Ameriprise Financial Services, Inc. is the successor in
interest to American Express Financial Corporation.

BACKGROUND
This dispute arises from Margaret Miller’s purchase of a
Flexible Adjustable Whole Life Insurance Policy (the Policy) from
North Central Trust Company and Trust Point, Inc. (collectively,
Trust Point).

Miller purchased the Policy in 1995 and placed it in

an irrevocable trust.

Sheely Aff. Ex. 2, ¶ 10.

Trust Point was

designated the “trustee, owner, and overseer” of the Policy.
¶ 14.

Miller paid the annual premium from 1995 to 2005.

Id.

Id. ¶ 12.

Thereafter, premium payments were deducted from the overall cash
value of the Policy.

Miller alleges that from 2005 to 2008 she was

unaware that the Policy was being diminished by premium payments.
Id. ¶ 16.
On July 20, 2011, Miller filed suit in Wisconsin state court,
alleging negligence and fraud in the administration of the Policy
(Wisconsin Action).

Miller brought claims against Ameriprise;

Jerry Kulinski, Miller’s Ameriprise Financial advisor; Trust Point;
and Mark Chamberlain, an agent of Trust Point.
asserted

crossclaims

against

Ameriprise

for

Trust Point

contribution

and

indemnification.
In the present action, Ameriprise argues that any claims
asserted by Miller or Trust Point are barred by the court’s Final
Order of Judgment in this case (Benacquisto Action), and moves for
an order to enforce settlement.

In response, the court issued a

briefing schedule and received memorandums in opposition from both

2

Miller and Trust Point.

See ECF Nos. 434, 440.

Oral argument is

unnecessary, and the court now considers the motion.

See Fed. R.

Civ. P. 78(b).

DISCUSSION
In the Benacquisto Action, the court permanently enjoined
class members who did not opt out of the settlement from bringing
any subsequent action based on the policies and annuities that were
the subject of the litigation.

See ECF No. 94, ¶ 14.

the

jurisdiction

court

expressly

relating to

the

retained

administration,

over

consummation,

Moreover,

“all

matters

enforcement

and

interpretation of the Settlement Agreement and [the] Order and
Judgment.”

Id.

¶

19.

Specifically,

the

court

reserved

jurisdiction to determine whether subsequent claims were barred by
the order.

Id. ¶ 19(a).

The court possesses the authority to

issue injunctions to enforce its final orders.

Thompson v. Edward

D. Jones & Co., 992 F.2d 187, 189 (8th Cir. 1993).
Pursuant

to

the

“Release

and

Waiver”

provision

of

the

settlement, class members agreed to release all past or present
claims “that

are

based upon,

related

to,

or

connected

with,

directly or indirectly, in whole or in part” to the Benacquisto
Action or the “released conduct.”
released

conduct

communications

includes

related

to

ECF No. 94, ¶ 13(A)(1).

representations,
or

3

connected

omissions
with

the

The
and
sale,

administration, servicing or performance of policies and annuities
issued by Ameriprise between January 1, 1985, and February 29,
2000.

As such, Ameriprise argues that the Benacquisto settlement

precludes Miller or Trust Point from pursuing claims against
Ameriprise in the Wisconsin Matter. Neither Miller nor Trust Point
dispute that the conduct underlying Miller’s claim is encompassed
by the Benacquisto settlement,2 rather they argue that notice of
the settlement was inadequate and that Miller should not be bound
by the Benaquisto settlement.
“In any class action ... the court shall direct to the members
of the class the best notice practicable under the circumstances,
including individual notice to all members who can be identified
through reasonable effort.” Fed. R. Civ. P. 23(c)(2)(B); see Eisen
v. Carlisle & Jacquelin, 417 U.S. 156, 177 (1974).

“Individual

notice of class proceedings is not meant to guarantee that every
member entitled to individual notice receives such notice, but it
is the court’s duty to ensure that the notice ordered is reasonably
calculated to reach the absent class members.”

2

Reppert v. Marvin

Initially there was confusion as to whether the Policy was
subject to the Benacquisto settlement. In her opposition brief,
Miller contends that Trust Point spoke with the class action
administrator and was told that Miller’s Policy did not qualify for
the class action. Resp’t Mem. Opp’n 3-4. Trust Point, however,
called the administrator in a different action, In Re: American
Express Financial Advisors Securities Litigation, No. 04-cv-1773.
The claim period in that action was from March 20, 1999, to April
1, 2006. See Roston Ex. D. The Miller Policy was purchased in
1995. See Sheely Aff. Ex. 2, ¶ 10.
4

Lumber & Cedar Co., 359 F.3d 53, 56 (1st Cir. 2004) (citations and
internal quotation marks omitted).

If notice is adequate, absent

class members are bound by the settlement even if those individuals
never receive notice.

Id.

Miller and Trust Point argue that neither received notice of
the Benacquisto Action. Miller was not an owner of the Policy, and
thus was not entitled to receive notice of the Benacquisto Action.
See Sheely Aff. Ex. 2, ¶ 14.

As to Trust Point, Ameriprise

submitted an affidavit from the class administrator, who asserts
that she mailed Trust Point both a class notice package and a
notice of relief.

Lake Aff. ¶¶ 2-6.

to be excluded from the class.

Trust Point did not request

Id. ¶ 8.

Further, notice of the

Benacquisto settlement was published in the New York Times, Wall
Street Journal and U.S.A. Today and in the newspaper with the
largest circulation in every state.

Id. ¶ 5; see also Reppert, 359

F.3d at 57 (noting that publication in a newspaper of general
circulation was sufficient to confer notice of class action even
though plaintiffs did not receive personal notice by mail). Notice
was also posted online.

As such, the court concludes that notice

in the Benacquisto Action constituted the best practicable notice
under the circumstances and was reasonably calculated to apprise
class members of their rights and the binding effect of the
settlement.

See ECF No. 94, ¶ 5.

to enforce settlement is granted.

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Therefore, Ameriprise’s motion

CONCLUSION
Accordingly, based on the above, IT IS HEREBY ORDERED that
defendant’s motion to enforce settlement [ECF No. 429] is granted.
Dated:

August 13, 2012
s/David S. Doty
David S. Doty, Judge
United States District Court

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