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Dodgers owner Mark Walter was named in a class-action lawsuit this week, giving him a new legal headache to deal with amid the ongoing federal investigation into the dealings of his business empire.
As the Wall Street Journal first reported, a Florida-based client of one of Walter’s insurance companies, Delaware Life, filed a lawsuit on Wednesday in the U.S. District Court of Miami seeking damages for negligent misrepresentation, breach of contract and aiding and abetting fraud — stemming from allegations that the company didn’t disclose potentially improper loans made to other Walter-owned businesses as so-called “affiliated” transactions.
Walter, Delaware Life and Walter’s Guggenheim Partners investment firm were all named as defendants in the suit, which was filed by the law firm Robbins Geller Rudman & Dowd on behalf of 67-year-old lead plaintiff Ira Rosner.
Walter has been under investigation since last year by the U.S. Attorney’s Office for the Southern District of New York and the Securities and Exchange Commission following a whistleblower complaint regarding misrepresented loans made between companies within his business portfolio.
Two of his insurance companies, Delaware Life and Clear Spring Life and Annuity, were served with grand jury subpoenas in the probe. Walter also had his cellphone and computer reportedly seized by FBI agents carrying out a search warrant aboard his private plane in Chicago last September.
Walter’s holding company, TWG Global, denied any wrongdoing in a statement last month, following the billionaire’s stunning sale of the Lakers.
Walter has also since sold his stake in Chelsea Football Club of the English Premier League. Dodgers officials have been adamant, however, that he has no plans to sell the baseball team.
This week’s lawsuit is the first time a client of a Walter-owned insurance company has taken civil legal action against him.
The suit claims that Walter and his companies conducted a “systematic scheme to conceal and misrepresent the allocation of insurer assets in entities affiliated with or controlled by Walter,” according to USA Today, and that Delaware Life initially kept the grand jury subpoena it received in February concealed from investors.
Group 1001, the parent company for Delaware Life, told USA TODAY it was aware of the lawsuit.
“No court has ruled that Group 1001 Insurance or Delaware Life Insurance Company did anything wrong, and we intend to defend the case vigorously, consistent with our long track record of serving policyholders with integrity,” a Group 1001 spokesperson said in a statement.
English (US)