Cassity Family lawsuit

Clayton-based funeral services company sued for $600 mil By Todd C. Frankel ST. LOUIS POST-DISPATCH 08/07/2009 ST. LOUIS — The long fight to recover $600 million from a once-high-flying funeral services company based in Clayton took another step Thursday. A federal lawsuit was filed alleging the Cassity family of St. Louis “preyed on consumers and funeral homes to perpetuate a multimillion-dollar, nationwide scheme from the sale of ‘pre-need’ funeral services and merchandise.” The suit seeks to recover costs expended by the plaintiffs — seven state insurance guaranty companies, including in Missouri and Illinois, which have stepped into the void to honor most of the pre-need contracts. Consumers typically bought the NPS contracts to lock in rates for funerals later. NPS then used life insurance policies to pay for the funeral costs. The Cassity family controlled several funeral-industry companies, including Forever Enterprises, National Prearranged Services (NPS), Lincoln Memorial Life Insurance Company and Memorial Service Life Insurance Company. NPS and Forever were headquartered on Brentwood Boulevard, across from Shaw Park. Last year, NPS and the life insurance companies ran out of money, leaving in limbo an estimated 150,000 pre-paid funeral service contracts spread out across the nation. State regulators in Texas, where the insurance companies were nominally based, seized control of the companies. A state-appointed special receiver took over to figure out where the money went. MORE METRO bullet Get news, columns, photos and multimedia from the St. Louis area While the Cassitys at first denied any wrongdoing and cooperated with regulators, “after a brief period of time, it became clear a lawsuit was the best alternative” to figuring out what happened, said attorney Larry Pozner, with the Denver law firm that filed Thursday’s lawsuit in Missouri’s eastern federal district. “We are seeking hundreds of millions of dollars that seems to be missing,” Pozner said. Similar lawsuits against the Cassitys filed by individual funeral homes have been stayed by judges pending the outcome of this most recent filing. So far, the guaranty funds have paid the pre-need contracts, which funeral homes were obliged to honor despite NPS’ demise. “Without the guaranty funds, there would be no funeral homes in Missouri,” said Connie James with James & Gahr Mortuaries in St. James, Mo. “The guaranty funds has been paying the bills, thank God.” The lawsuit seeks damages from the Cassity family, former high-level NPS officials and several banks and trusts that were supposed to monitor the disbursement of the pre-need funeral funds. Family members could not be located for comment. At the heart of the matter is a secretive Cassity family trust, RBT Trust II. Some believe any missing funds could be hidden in the account. Pozner pointed out that a lawsuit is one way to “pierce the veil” of a family trust and see its financial records.

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