Federal Jury Reaches $391 Million Verdict Against PNC Bank, Successor to Trustee for Pre-Need Funeral Contract Trusts
The Special Deputy Receiver (SDR), the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA) on behalf of 28 state guaranty associations, and the state guaranty associations of Missouri, Texas, Illinois, Arkansas, Kansas, Oklahoma, and Kentucky were awarded $391 million, including $35.5 million in punitive damages, against PNC Bank following a five-week jury trial.
The SDR, NOLHGA and the state guaranty associations joined forces to pursue breach of fiduciary duty and negligence claims against PNC, which was the successor to Allegiant Bank and Trust Company, a St. Louis-based bank that had served as a trustee for multiple NPS pre-need funeral trusts.
The case is not yet final and it is believed that PNC will file post-trial motions in the trial court and will appeal. The trial court and the appellate courts could modify or reverse the judgment. Until such time as the award is collected, the SDR cannot estimate the amount that the estates will ultimately distribute to creditors.
There will be no change to the coverage provided by the guaranty associations under the Liquidation Plan.