Structured Settlement Consultants
Case Law Updates
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Editor: Daniel J. Alvarez, J.D.
Profession: Settlement Planner, Millennium Settlements
Murphy v Internal Revenue Service and United States of America
Category: Case Law Updates
The Court of Appeals for the District of Columbia has held that section 104(a)(2) of the Internal Revenue Code is unconstitutional to the extent it permits taxation of damages for nonphysical personal injuries that are unrelated to lost wages or earnings.
The decision although surprising and potentially encouraging has been met with tempered enthusiasm by most analysts. Its effect is limited based on a number of factors including likelihood of appeal by the government but is worth noting nonetheless.
Lyons v Medical Malpractice Insurance Association, NY 2001
Category: Case Law Updates
The plaintiffs settled a medical malpractice case for a cash payment of $265,000 and a structured settlement ($3,000 monthly payable for life with a 20 year guarantee). The insurance company represented the total present value of the settlement to be $940,180.
The plaintiffs later discovered the child had been age rated to age 54. The structured settlement actual only cost the defendants $410,000.
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Grillo v Pettiete, 96th District Court, Tarrant Co., TX
Category: Case Law Updates
In 1982, Christina Grillo was injured at birth at a hospital in Texas. Her family filed suit against the attending physician asserting negligence caused quadriplegia, blindness, and seizures. Life care plans estimated her future needs and costs to hit $20 million. The case settled to cash in 1990 for $2.5 million.
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