White and Nadeau v. Symetra – Part 2


This past week, a three-judge panel of U.S. Ninth Circuit Court of Appeals heard oral arguments in a lawsuit seeking class action certification brought by Plaintiff-Appellees Renaldo White and Randolf Nadeau against Defendant-Appellants Symetra Assigned Benefits Service Company (SABSCO) and Symetra Life Insurance Company (Symetra Life) – herein sometimes referred to jointly as “Symetra.”

A prior Independent Expert article (Part 1) provides case background and summarizes the Plaintiffs’ lawsuit, the District Court decision and the District Judge’s analysis. This Part 2 article:

  • Repeats the case summary;
  • Identifies: 1) the appellate judges; 2) both parties’ attorneys; 3) the standard for appellate review; 4) Symetra’s rationale for appeal; and 5) issues Symetra raises on appeal; and
  • Further summarizes the appellate briefing arguments of both Symetra (combining their Brief and Response Brief) and the Plaintiffs (including a summary of their expert’s Damage Report).

A subsequent Part 3 Article will consider the White and Nadeau v. Symetra class action case in the context of the history of structured settlement factoring and offer additional observations about the case plus recommendations for settlement planners.

Case Summary

Plaintiffs White and Nadeau each were recipients of structured settlement annuities (SSAs) purchased and owned by SABSCO, and issued by SAFECO (n/k/a Symetra). Each of their settlement agreements included language explicitly stating they lacked the power to transfer their future SSA payments. Plaintiffs later sold their rights to future payments to SABSCO in exchange for immediate lump sum payments at a significant discount.  Each of White’s and Nadeau’s subsequent transfers of their payment rights was approved by a state court as being in their “best interest.”

On December 30, 2020, Plaintiffs White and Nadeau filed a class action lawsuit, individually and on behalf of approximately 2000 other structured settlement recipients who similarly sold their payment rights to Defendants, in the United States District Court Western District of Washington at Seattle seeking to certify the following class and subclass:

  • Nationwide Class – “All persons who are or were, at any time, annuitants of [a structured settlement annuity] (SSA) that contemplated life contingent payments issued by Symetra and who subsequently sold to a Symetra affiliate the right to receive payments from that SSA in a factoring transaction.”
  • Void Ad Initio Subclass – “All members of the Class whose contract defining the annuity at issue included language explicitly stating that the annuitants lack the power to transfer their future SSA payments.”

Plaintiffs’ general allegations:

  • Defendants utilized the information they already had on structured settlement recipients to target their factoring solicitations.
  • Defendants preyed upon structured settlement recipients’ trust in Defendants as the issuer of their annuities, without disclosing their profit-motive and conflict of interest.
  • Defendants’ solicitation of their rights to the future structured settlement payments under the SSAs was predatory and the result of an illegal business scheme.
  • This illegal business scheme was designed to induce them and other structured settlement recipients into selling their future payments at a steep discount resulting in damages of an estimated $75 million.

The Plaintiffs more specific legal claims against the Defendants: 1) Violations of the Racketeer Influenced and Corrupt Organizations Act (RICO); 2) Violations of the Washington Consumer Protection Act (CPA); 3) Violation of the duty of good faith and fair dealing; 4) Breach of fiduciary duty against Symetra; 5) Breach of fiduciary duty against SABSCO; 6) Breach of contract; 7) Tortious interference with contract; 8) Civil conspiracy; and 9) Unjust enrichment.

On August 3, 2022, United States Senior District Judge Marsha J. Pechman issued an order:

  • Determining Plaintiffs had provided sufficient evidence to establish by a preponderance of the evidence that class certification was appropriate and proper for each of their legal claims with the exception of their breach of fiduciary duty claims which the Judge denied.
  • Certifying each of the two classes Plaintiffs proposed as set forth above.

The Defendants’ Appeal

Defendants SABSCO and Symetra Life filed an appeal with the U.S. Ninth Circuit arguing Judge Pechman abused her discretion in granting certification and reversal is required. Defendants maintain Plaintiffs cannot “actually prove” any of their claims are “capable of class-wide resolution” and  Judge Pechman’s decision was based on errors of law and a selective analysis of the factual record.

Appellate Attorneys

Attorneys Maeve L. O’Connor and Susan Reagan Gittes of Debevoise & Plimpton LLP and Medora A. Marisseau of Karr Tuttle Campbell serve as counsel for Symetra in its appeal.

The law firms of Keller Rohrbach, L.L.P. , Marcus & Auerbach LLC, Edward Stone Law, P.C., and Marcus & Marcus PLLC serve as attorneys for the Plaintiffs, the Class and the Subclass.

Appellate Judges

President Donald Trump appointed Justices Bade and Bress. Justices Ikuta and Bress are, or have been, members of the Federalist Society.

Standard of Review

As stated in Plaintiffs’ Response Brief: “A district court’s decision to certify a class under Rule 23 is reviewed for abuse of discretion.

Symetra’s Rationale for its Appeal: “[g]iven the numerous individualized issues that necessarily will inform the adjudication of each class member’s claims against Symetra and SABSCO, and the necessity of individualized fact-finding with respect to questions of injury and causation, a class action is inappropriate and the order certifying a class must be reversed.”

Issues Symetra Raises on Appeal: “whether the District Court erred (abused her discretion)” in certifying the Nationwide Class and Subclass identified above:

  • “[B]y concluding that the fact of injury…..could be proven on a classwide basis despite extensive record evidence … that injury is a highly individualized inquiry.
  • “In concluding that the existence of a misrepresentation or omission can be established on a classwide basis despite zero evidence of any class-wide omission or misrepresentation, and extensive evidence of individualized communications …….
  • “[I]n finding Plaintiffs could determine causation on a classwide basis through applying a “common sense” presumption of reliance that is not the law in this Circuit as to Plaintiffs’ RICO and civil conspiracy claims, and by inferring proximate causation as to Plaintiffs’ CPA claims, in contravention of Ninth Circuit precedent.
  • “[I]n certifying a nationwide class predicated on Plaintiffs’ contract claim despite highly individualized contractual choice of law issues and variations in contractual language.
  • “[I]n ignoring that Plaintiffs offered no theory susceptible of classwide proof for tolling the statute of limitations.
  • “[I]n finding class treatment superior despite myriad individualized evidence and individual class members’ interests in controlling their claims.”

Summary of Symetra’s Appellate Briefing Arguments

Plaintiffs’ Comprehensive Allegations

Symetra first addresses Plaintiffs’ comprehensive allegations that Symetra uniformly mislead class members into selling their payments; that Symetra’s purchase of payment rights from annuities issued by Symetra Life was per se improper and/or constituted a “conflict of interest.”

Symetra’s response: the roles of Symetra Life and SABSCO were repeatedly disclosed to payees and the class members’ transfers were approved by state court judges in accordance with state and federal law as being in the payee’s “best interest.”

As a result, Symetra argues, despite class members contrary representations to state court judges, proving they were harmed by Defendants misrepresentations and omissions would require analysis of individualized evidence specific to each class member – and Defendants would be entitled to cross-exam each individual Plaintiff.  None of which is available in a class action lawsuit.

Symetra further argues the District Judge ignored the requirement of Federal Rule of Civil Procedure (FRCP) Rule 23 that Plaintiffs seeking class certification “[must] prove by a preponderance of admissible evidence, not simply plead, that their claims are susceptible of common proof and that individualized issues would not predominate over common ones.”  Instead, Symetra maintains, Plaintiffs’ claims present numerous individualized inquiries that easily outnumber their purportedly common questions, thereby rendering their case inappropriate for class certification under Rule 23.

Despite Plaintiffs’ acknowledgment that proving fact of injury is a requirement of each of their claims, Symetra maintains the District Court avoided the question of injury altogether. Symetra states: the District Court “only [mentioned] injury to inexplicably suggest that it was ‘not relevant here.’  Instead, the District Court appeared to accept the notion that the sale of future payments for an immediate but smaller lump sum is per se harmful.” Therefore, Symetra argues, individual trials would be required to determine whether any class member was injured by receiving a lump sum.

Note: Symetra’s statement about the District Court avoiding the question of injury altogether is incorrect. Although limited to one paragraph, the District Court Order does address damages including references to, and conclusions from, the Plaintiffs’ economic expert’s report. That report is summarized below.

Symetra further takes issue with Plaintiffs’ allegation that Symetra’s communications with class members were “uniform” and the District Court’s conclusion that certain information was omitted from communications with Plaintiffs on a class wide basis. As to Plaintiffs’ “uniform” allegation, Symetra argues such determinations will require individualized inquiries inconsistent with class status. Symetra maintains Defendants’ purported omissions of their “profit motive” and their alleged “conflict of interest” is not supported by the record.

Plaintiffs’ Specific Claims

In addition to these comprehensive deficiencies to class certification, Symetra finds additional reasons why specific Plaintiff claims should fail class certification.

For example, Symetra argues that both Plaintiffs’ RICO claims and Washington CPA claims should fail for lack of causation proof. For the RICO claims, Symetra states the District Judge erred in finding a “common sense inference of reliance.” For the CPA claims, Symetra argues the facts don’t support causation based on omissions.

For the Breach of Contract Subclass, Symetra argues: 1) the law interpreting anti-assignment language varies from state to state; 2) the District Court Order improperly puts the Burden of Proof on Defendants to prove the contents of thousands of disparate contracts drafted by representatives of third-party tortfeasors.

Finally, Symetra argues, the District Court ignored the Plaintiffs failure to identify any class wide theory tolling the statute of limitation for cases dating back to 2005.

Summary of Plaintiffs’ Appellate Briefing Arguments

General Case Argument

Plaintiffs’ Appellate Brief includes a summary of their comprehensive case argument:

The Plaintiffs view structured settlements as a legislative quid pro quo. As issuer and owner of SSAs for the benefit of the Plaintiffs, Defendants Symetra Life and SABSCO promised to protect class members’ well-being through these long-term periodic payments. In return, Plaintiffs assert the Defendants received billions of dollars in premiums and preferential tax treatment.

Plaintiffs maintain that when Symetra’s book of SSA business grew less profitable, Defendants sought to shed their risk at Plaintiffs’ expense by setting up an in-house “factoring” operation. Plaintiffs argue Symetra’s business plans, internal presentations, and a host of other evidence reveal Symetra pursued factoring to improve its “financial returns,” without regard for its duties to the Plaintiffs.

Plaintiffs assert Symetra’s factoring operation was unique because, unlike other factoring companies, Symetra also served as both the issuer and obligor.  Symetra sought to purchase the same SSA payments they had issued.  Symetra had a pre-existing client base to leverage for factoring including a list of structured settlement payees, contact information, and data about their annuities. Unlike third-party factoring companies, Symetra did not have to invest substantial sums to acquire marketing leads.

Plaintiffs maintain the evidentiary record demonstrates Symetra sent Plaintiffs direct mass mailings, emails and “newsletters” advertising its “funding [i.e. factoring] service” using common forms and advertisements which stressed a relationship of trust, promoted SABSCO as Plaintiffs’ “advocate” and promised to watch out for Plaintiffs’ best interests – without identifying any self-dealing or conflict of interest.

Common Questions

Contrary to Symetra, Plaintiffs understandably agree with the District Court Order that common questions define and prevail as to Plaintiffs’ claims and therefore justify class certification. In their Appellate Brief, Plaintiffs highlight these common factors:

  • Each Plaintiff was the payee/beneficiary of an SSA issued by Symetra and assigned to SABSCO, a relationship by which Defendants undertook obligations for the protection of every Plaintiffs’ long-term financial well-being.
  • These relationships were documented in form contracts which Defendants drafted and which contained relevant standardized language.
  • As to each and every Plaintiff: contrary to their obligations, Defendants misused confidential personal information and other data obtained by virtue of their positions as issuer and assignee of Plaintiffs’ SSAs to unwind those very same transactions.
  • Defendants were unjustly enriched in the same way through each and every class transaction, profiting from a strategy to avoid their long-term obligations to Plaintiffs under common unjust circumstances.
  • And Defendants injured each Class Member in the same way, paying them a small fraction of what their SSA payments were worth and impairing Plaintiffs’ legal rights under their structured settlements.


As discussed above, as part of its justification to defeat class certification, Symetra maintains in its Appellate Brief that the District Court avoided the question of injury stating: the District Court “only [mentioned] injury to inexplicably suggest that it was ‘not relevant here.’  Instead, the District Court appeared to accept the notion that the sale of future payments for an immediate but smaller lump sum is per se harmful.”

Note: Symetra’s statement is incorrect. Although limited to one paragraph, the District Court Order does indeed address damages referencing the report of Plaintiff’s economic expert Corwin Zass. Futher, as set forth in Plaintiffs’ Appellate Brief:

  • The Zass Report specifically opines as to “whether common evidence is available to prove the effects of Plaintiffs’ claims, including that all or nearly all Class Members sustained an injury” with total damages incurred by both classes estimated to be approximately $75 million.
  • Symetra offered no expert testimony rebutting Zass’ Expert Report, nor did they move to exclude him.
  • The Zass Report offers four models to demonstrate classwide injury:
    • Fair Commutation: This methodology compares the discount rate Defendants used to determine the purchase price paid to each Plaintiff with a benchmark fair value discount rate, less amounts paid to Plaintiffs. This model assumed Plaintiffs would have engaged in a factoring transaction which, Plaintiffs argue, renders Defendants’ injury and injury causation arguments irrelevant. Zass arguably demonstrates that every Plaintiff was injured even if they would have engaged in a factoring transaction because of the inferior deal Symetra provided.
    • Expectation: This methodology compares what Plaintiffs would have received under their SSAs versus the purchase price paid in each transaction (adjusted to present value and backing out money received by Plaintiffs). Plaintiffs argue this calculation confirms that each and every Plaintiff was injured notwithstanding the sums they received from Defendants.
    • GAAP Reserve: This disgorgement-based methodology compares Symetra’s GAAP (“Generally Accepted Accounting Principles”) reserve values to the purchase price paid to Plaintiffs in each factoring transaction. This model is Defendant-focused and, Plaintiffs assert, requires no inquiry into Plaintiff’s individual circumstances.
    • Statutory Reserve Release: This disgorgement-based methodology compares the Statutory Reserve (Commutation Value) paid by Symetra to SABSCO with the purchase price paid to Class Members in each factoring transaction.


Depending upon the decision of the three-judge panel of the U.S. Ninth Circuit Court of Appeals that heard oral arguments, the lawsuit seeking class action certification brought by Plaintiff-Appellees Renaldo White and Randolf Nadeau against Defendant-Appellants Symetra Assigned Benefits Service Company (SABSCO) and Symetra Life Insurance Company (Symetra Life) may or may not ultimately be certified for trial on its merits.

The detailed case analysis provided in the District Court Order and the Appellate Briefs filed by Plaintiffs and Defendants nonetheless provide a legal description and argumentation of a unique business model in the context of structured settlement factoring history and the primary market’s strategy to address factoring and factoring abuse.

A subsequent Part 3 article will discuss the Symetra model in the context of that history and offer observations and recommendations about future primary market strategy to address and reduce factoring abuse.