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Home > News > EMH Wins Michigan Life Insurance Case DETROIT, MI (August 25,2011) — EMH obtained a favorable summary judgment ruling from the Eastern District of Michigan for a client in a $10 million life insurance dispute involving non-recourse premium financing. The insured, through a trust, had applied for two policies from EMH's client totaling $10 million in death benefits, then collaterally assigned the policy rights to a third-party lender, which funded all policy premiums for the next two years. EMH's client sought to rescind the policies after discovering the nature of the transaction. The trust then defaulted on its loan to the premium financier, which foreclosed on the policies, and the insured and trust then sued EMH's client for breach of contract. United States District Court Judge Stephen J. Murphy III found that the insured and trust lacked standing to sue EMH's client due to the nature of the financing transaction. Because they had defaulted on their loan, all rights to the policies had been permanently assigned to the third-party lender through the foreclosure, and thus the plaintiffs had no standing to bring any claims based on the policies. Judge Murphy granted EMH client's motion for summary judgment, denied the insureds' cross-motion for summary judgment, and dismissed the case.
EMH attorneys Tom Hetherington, David McDowell, and Kendall Burr handled this matter.
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