Factoring Company Violated Antitrust Law, Says Competitor’s Lawsuit

Factoring Company Violated Antitrust Law, Says Competitor’s Lawsuit

A structured settlement factoring company’s complaint alleges that a competitor – that has more than seventy-percent of the secondary market for structured settlement payments – violated federal anti-trust laws.

Novation Ventures, L.L.C., filed a complaint in federal court in California, alleging that J.G. Wentworth Company has, since a merger with Peachtree Settlement Funding in 2011, violated the Sherman Anti-Trust Act and the Clayton Act.

Novation, which says its market share of the business of obtaining rights to structured settlement payments is around 7%, claims that the Wentworth companies control around 75% of that market.

The business of purchasing structured settlement payment rights is governed by state structured settlement protection acts (SSPAs), which provide that such transactions are not effective unless approved by a court.

Novation alleges that the J.G. Wentworth companies did not disclose to courts – which have been making decisions about whether to approve such transfers – the fact that J.G. Wentworth and Peachtree Settlement Funding are controlled by the same entity, JGWPT Holdings, Inc.

News stores about the lawsuit include the following:

The lawsuit is captioned Novation Ventures, L.L.C. v. The J.G. Wentworth Company, L.L.C., et al., case number 2:15-cv-00954, U.S. District Court, Central District of California, and a docket list is available here.

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