15-Aug-2013
Results of Operations and Financial Condition, Regulation FD Disclosure,
On August 15, 2013, The Phoenix Companies, Inc. (the "Company") issued a news release providing highlights from the filing of the Phoenix Life Insurance Company's unaudited statutory financial results for the quarter ended June 30, 2013 and certain second quarter 2013 estimated operating metrics. The news release is furnished as Exhibit 99.1 hereto, and is incorporated herein by reference.
By order dated July 12, 2013, two separate classes were certified in an action pending in the United States District Court for the Southern District of New York (C.A. No. 1:11-cv-08405-CM-JCF (U.S. Dist. Ct; S.D.N.Y.)) brought by Martin Fleisher and another (the "Fleisher Litigation"), on behalf of themselves and others similarly situated, against Phoenix Life Insurance Company ("Phoenix Life"), a wholly-owned subsidiary of the Company. The complaint in the Fleisher Litigation challenges two cost of insurance rate ("COI") adjustments implemented by Phoenix Life, which Phoenix Life maintains were based on policy language permitting such adjustments. The complaint seeks damages for breach of contract. The classes certified in the court's July 12, 2013 order are limited to holders of Phoenix Life policies issued in New York and subject to New York law.
In addition to Phoenix Life, Phoenix Life subsidiary PHL Variable Insurance
Company ("PHL Variable") has been named as a defendant in four actions
challenging its COI rate adjustments implemented concurrently with the Phoenix
Life adjustments. These four cases, which are not styled as class actions, have
been brought against PHL Variable by (1) Tiger Capital LLC (C.A. No.
1:12-cv-02939-CM-JCF; U.S. Dist. Ct; S.D.N.Y.; the "Tiger Capital Litigation")
and (2-4) U.S. Bank National Association, as securities intermediary for Lima
Acquisition LP ((2: C.A. No. 1:12-cv-06811-CM-JCF; U.S. Dist. Ct; S.D.N.Y.; 3:
C.A. No. 1:13-cv-01580-CM-JCF; U.S. Dist. Ct; S.D.N.Y.; collectively, the "U.S. Bank N.Y. Litigations"); and 4: C.A. No. 1:13-cv-00368-GMS; U.S. Dist. Ct; D. Del.; the "Delaware Litigation"). The Tiger Capital Litigation and the two U.S. Bank N.Y. Litigations have been assigned to the same judge as the Fleisher Litigation, and discovery in these four actions is being coordinated by the court; the Delaware Litigation is proceeding separately. The plaintiffs seek damages and attorneys' fees for breach of contract and other common law and statutory claims.
Complaints to state insurance departments regarding PHL Variable's COI rate adjustments have also prompted regulatory inquiries or investigations in several states, with two of such states (California and Wisconsin) issuing letters directing PHL Variable to take remedial action in response to complaints by a single policyowner. PHL Variable disagrees with both states' positions, and Wisconsin has commenced an administrative hearing to obtain a formal ruling on its position, which is pending (OCI Case No. 13-C35362).
Phoenix Life and PHL Variable believe that they have meritorious defenses against all of these lawsuits and intend to vigorously defend against these claims. The outcome of this litigation is uncertain and any potential losses cannot be reasonably estimated. PHL Variable believes it has meritorious defenses to the regulatory directives and intends to vigorously defend against them.
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Cautionary Statement Regarding Forward-Looking Statements
The foregoing contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. We intend Form 8-K, August 15, 2013.