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Claims Servicer Fights To Manage NFL Concussion Payments

A claims management service assisting former NFL players with a settlement in multidistrict litigation over brain injuries urged a Pennsylvania federal court Thursday to allow the ex-players to pay a portion of their awards to third-party lenders and claims services providers, saying the court lacks jurisdiction over the nonparties. Case Strategies Group further contended that even if the court had proper jurisdiction, it should deny co-lead counsel’s bid to withhold awards from the settlement because the counsel’s arguments center around subjective beliefs about disgorgement and contract invalidation in these NFL concussion payments cases. The company adds that class counsel is effectively seeking injunctive relief by attempting to withhold the funds, but doesn’t satisfy the standards for pursuing this type of relief.

“Class counsel’s motion is factually, procedurally, and legally deficient, and supported by nothing more than class counsel’s subjective beliefs,” the filing says.

Co-lead counsel for the class of former players, Christopher A. Seeger of Seeger Weiss LLP, argued last month that the court should order the claims administrator to withhold any portion of the awards meant for lenders or claims services providers in order to block class members from distributing the money before the court can determine the parties’ legal right to it.

But nonparty Case Strategies Group shot back that the dispute is based on class counsel’s subjective fears about an inability to distribute the awards to third parties and difficulty seeking disgorgement if the court finds the third parties aren’t entitled to the funds. The argument depends upon the “faulty premise” that the third-party contracts will ultimately be invalidated, the claims management service added.

“Given that this issue originated with an unfortunate and unnecessary effort to create a contractual dispute — where, in fact, the actual parties, and their lawyers, to the contract are in agreement — there simply is no reason for class counsel’s motion to be granted,” the company’s counsel Richard L. Scheff of Montgomery McCracken Walker & Rhoads LLP said by email.

Case Strategies Group further noted in the filing that class counsel is essentially seeking injunctive relief, and must therefore demonstrate a “substantial likelihood of success on the merits,” irreparable harm without the injunction, that preliminary relief won’t “result in even greater harm” to the other party, and the relief is in the public interest. Co-lead counsel has failed to do so, the filing said.

Seeger said Case Strategies Group’s arguments are “without merit.”

“We will continue to protect class members from unscrupulous third parties,” Seeger said in a statement.

Case Strategies Group is represented by Richard L. Scheff, Peter Breslauer and David F. Herman of Montgomery McCracken Walker & Rhoads LLP.

The class is represented by Christopher Seeger of Seeger Weiss LLP.

The case is In re: National Football League Players’ Concussion Injury Litigation, case number 2:12-md-02323, in the U.S. District Court for the Eastern District of Pennsylvania.

The above was first reported by Law360.

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