Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-02511/USCOURTS-cand-3_05-cv-02511-14/pdf.json

Nature of Suit Code: 350
Nature of Suit: Motor Vehicle Personal Injury
Cause of Action: 28:1346 Tort Claim

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -1-

KEVIN V. RYAN (SBN 118321)

United States Attorney

JOANN M. SWANSON (SBN 88143)

Chief, Civil Division

JONATHAN U. LEE (SBN 148792)

Assistant United States Attorney

450 Golden Gate Avenue, Tenth Floor

San Francisco, California 94102

Telephone: (415) 436-6909

Facsimile: (415) 436-6748

Email: jonathan.lee@usdoj.gov

Attorneys for Defendant UNITED STATES

DAVID A. NOLD, pro hac vice (WSBA #19009)

NOLD & ASSOCIATES, PLLC

10500 NE 8 STREET, SUITE 930 th

BELLEVUE, WA 98004

dnold@washlaw.biz

Telephone: (425)289-5555 

Facsimile: (425) 289-6666

MARK C. LAMB (SB #198090)

22833 BOTHELL EVERETT HWY, SUITE 218

BOTHELL, WA 98021

Telephone: (425)368-4238

Attorneys for Plaintiff CURTIS STEELE and B.I.S.

ABBEY, WEITZENBERG, WARREN & EMERY, P.C.

W. BARTON WEITZENBERG, ESQ. (SBN 051788)

MICHAEL D. GREEN, ESQ. (SBN 214142)

100 Stony Point Road, Suite 200

Santa Rosa, California 95401

Tel: (707) 542-5050

Fax: (707) 542-2589

Attorneys for JOHN DEMARTINI, 

as Guardian Ad Litem for R.A.D., and C.M.S.

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

CURTIS LYNN STEELE, an individual, 

Plaintiff,

 vs.

UNITED STATES OF AMERICA,

 Defendant.

 

)

)

)

)

)

)

)

)

)

)

)

)

)

No. C 05-2511 TEH 

(Lead Case; Consolidated with John

DeMartini, as Guardian Ad Litem for

R.A.D. and C.M.S.; and Irene Steele and

Darryl Steele as Co-guardians Ad Litem for

B.I.S. 05-4399 TEH)

STIPULATION AND PROPOSED

ORDER APPROVING SETTLEMENT

DISBURSEMENT TO PLAINTIFFS

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 1 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -2-

THE PARTIES, BY AND THROUGH THEIR ATTORNEYS OF RECORD, HEREBY

SUBMIT THE FOLLOWING STIPULATION:

WHEREAS, on September 21, 2004, Curtis Steele and Tracy DeMartini were involved in

a motor vehicle accident with a federal employee;

WHEREAS, Tracy DeMartini died on or about September 23, 2004;

WHEREAS, following the events of September 21, 2004, Curtis Steele made an

administrative claim for tort damages on December 21, 2004;

WHEREAS, on June 21, 2005, Curtis Steele filed this lawsuit against the United States of

America, alleging damages under the Federal Tort Claims Act;

WHEREAS, on or about May 16, 2005, John DeMartini filed administrative claims on

behalf of Minors R.A.D. and C.M.S and on or about June 14, 2005 Irene and Darryl Steele filed

an administrative claim on behalf of Minor B.I.S;

WHEREAS, on or about October 20, 2005, John DeMartini named the United States of

America as defendant in his state court, alleging damages under the Federal Tort Claims Act,

said action was removed to federal court on October 28, 2005, and Irene Steele and Darryl Steele

filed a lawsuit on or about October 24, 2005;

WHEREAS, all lawsuits were consolidated into the lead case no. C 05-2511 TEH;

WHEREAS, the Court dismissed defendants Lake County Tribal Health Consortium and

Thomas Rangel by order dated March 13, 2006;

WHEREAS, the parties attended a settlement conference before the Honorable Elizabeth

Laporte on June 9, 2006;

WHEREAS, the parties reached agreement on the terms of settlement recorded herein on

or about June 16, 2006;

IT IS HEREBY STIPULATED as follows:

1. By Stipulation and Order Approving Settlement, filed June 28, 2006 and

approved by the Court on June 29, 2006 (See Action 05-2511, Docket entry #60), the parties and

Nonprofits’ Insurance Alliance of California (hereinafter, “NIAC” or “Insurer”) agreed to settle

all of plaintiffs’ claims or potential claims arising from the subject matter of this consolidated

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 2 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -3-

litigation. The terms and conditions of the settlement agreement, as set forth in the Stipulation

and Order Approving Settlement, are incorporated herein by reference as though fully set forth,

including but not limited to the full release by plaintiffs of all claims or potential claims. 

2. The purpose of this Stipulation of Settlement and Disbursement Of Funds is to set forth

the terms of disbursement of the settlement proceeds, consistent with the Stipulation and Order

Approving Settlement previously approved by the Court. In the Stipulation and Order

Approving Settlement, the parties provided that the United States would fund $700,000 in lump

sum payments to plaintiffs and NIAC would fund $1,000,000 to a combination of annuity

products and lump sum payments to be determined. The United States will make lump sum

payments only; all periodic payments described in this Stipulation shall be made under the terms

of annuities contracts to be purchased by NIAC. 

This stipulation sets forth how the settlement will be funded and how the settlement funds

are to be disbursed. 

3.SETTLEMENT DISBURSEMENT FOR R.A.D. For purposes of this agreement, the

parties will refer to plaintiff Rickie Ann DeMartini as R.A.D. The settlement amount of 

$600,000.00 for Plaintiff John DeMartini on behalf of R.A.D. will disbursed as follows:

A) Litigation Costs and Attorneys Fees: A total of $6,390.56 in litigation costs have

been incurred on behalf of plaintiff John DeMartini as Guardian ad litem for R.A.D and C.M.S. 

R.A.D.’s pro rata share of the total litigation costs equals $3,834.34. Plaintiff John DeMartini as

Guardian Ad Litem for R.A.D. and C.M.S. has a fee agreement with his attorneys Abbey

Weitzenberg Warren & Emery and Tibor Major for services provided in pursuing the subject

claims on a contingency fee basis for twenty five percent (25%) of the total recovery after

reduction of litigation costs. The attorneys fees for the R.A.D. portion of the subject settlement

proceeds is twenty five percent (25%) of ($600,000.00 less $3,834.34 in litigation costs) or

$149,041.41. Attorneys fees and Litigation Costs will be funded by a check from the United

States of America made payable to Abbey Weitzenberg Warren & Emery and Tibor Major in the

sum of $152,875.75.

B) Purchase of an Annuity for the Benefit of R.A.D.: The $424,520.70 of remaining

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 3 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -4-

settlement proceeds will be paid by Nonprofits Insurance Alliance of California directly to

American General Annuity Service Corporation for the purchase an annuity for the benefit of

R.A.D as compensation for the settlement of the above entitled action. The terms of the annuity

are detailed in Exhibit A. 

C) Deposit into Blocked Account Available to R.A.D. at Age 18: The remaining

$22,603.54 of the settlement proceeds will be paid by a check from the United States of America

made payable to R.A.D. and shall be deposited into an interest bearing federally insured account

with the San Francisco Police Credit Union located at 2550 Irving Street, San Francisco,

California 94122, which withdrawals will not be permitted until R.A.D. turns eighteen (18) years

of age.

3.1 Payments

In consideration of the release set forth above, NIAC and the United States agree to pay to

the individuals named below (the “payees”) the sums outlined in this section below:

3.2 Payments due at the time of settlement as follows:

(A) The United States will tender a check made payable for attorneys fees

and litigation costs to Abbey Weitzenberg Warren & Emery and

Tibor Major in the sum of $152,875.75.

(B) Nonprofits Insurance Alliance of California will purchase an annuity

for the cost of $424,520.70, payable directly to American General

Annuity Service Corporation, which an annuity will be for the benefit

of R.A.D as compensation for the settlement of the above entitled

action. 

C) The United States will tender a check made payable to R.A.D. in the

amount of $22,603.54 which will be delivered to her attorneys of

record for deposit in accordance with this stipulation. 

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 4 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -5-

3.3 Periodic payments made according to the schedule as follows (the "Periodic

Payments"):

3.3a Payable to RAD:

$1,475.00 per month for the life of RAD, guaranteed 20 years, beginning on

November 8, 2012, increasing at 3% compounding annually. Compounding benefits

begin November 8, 2013. The last guaranteed payment will be made on October 8,

2032.

$25,000.00 guaranteed lump sum payable on November 8, 2019.

$50,000.00 guaranteed lump sum payable on November 8, 2024.

$102,019.73 guaranteed lump sum payable on November 8, 2029.

3.4 Payee’s Rights to Payments

Plaintiffs acknowledges that the Periodic Payments cannot be accelerated, deferred,

increased or decreased by the Plaintiffs or any payee, nor shall the plaintiffs or any payee have the

power to sell, mortgage, encumber, or anticipate the Periodic Payments, or any part thereof, by

assignment or otherwise. 

3.5 Payee’s Beneficiary

Any payments to be made after the death of any Payee(s) pursuant to the terms of this

Settlement Agreement shall be made to such person or entity as shall be designated in writing by

Plaintiff(s) to the insurer or the Insurer's Assignee. If no person or entity is so designated by

Plaintiff(s), or if the person designated is not living at the time of the Payee's death, such payments

shall be made to the estate of the Payee. No such designation, nor any revocation thereof, shall be

effective unless it is in writing and delivered to the Insurer or the Insurer's Assignee. The

Designation must be in a form acceptable to the Insurer or the Insurer's Assignee before such

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 5 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -6-

payments are made, but in no event shall the request of the payee be unreasonably withheld or

denied.

3.6 Consent to Qualified Assignment

3.6a Plaintiffs acknowledge and agree that the Defendants and/or the

Insurer may make a “qualified assignment”, within the meaning of

Section 130 of the Internal Revenue Code of 1986, as amended, of

the Defendants and/or the Insurer’s liability to make the Periodic

Payments set forth in Section 3.3a to American General Annuity

Service Corporation (“the Assignee”). The Assignee’s obligation for

payment of the Periodic Payments shall be no greater than that of the

Defendants and/or the Insurer (whether by judgment or agreement)

immediately preceding the assignment of the Periodic Payments

obligation. 

3.6b Any such assignment, if made, shall be accepted by the plaintiffs

without right of rejection and shall completely release and discharge

the Defendants and the Insurer from the Periodic Payments obligation

assigned to the Assignee. The Plaintiffs recognize that, in the event

of such an assignment, the Assignee shall be the sole obligor with

respect to the Periodic Payments obligation, and Plaintiffs agrees that

such assignments shall constitute a full release and discharge of all

of the Defendants and Insurer’s obligations relative to the Periodic

Payments set forth above. 

3.7 Right to Purchase Annuity

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 6 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -7-

The Defendants and Insurer, itself or through American General Annuity Service

Corporation (“the Assignee”) reserve the right to fund the liability to make the Periodic Payments

in Section 3.3a through the purchase of an annuity policy from American General Life Insurance

Company. The Assignee shall be the sole owner of the annuity policy and shall have all rights of

ownership. The assignee may have American General Life Insurance Company mail payments

directly to the Payee(s). The plaintiffs shall be responsible for maintaining a current mailing address

for Payee(s) with American General Annuity Service Corporation. 

3.8 Discharge of Obligation

The obligation of the assignee to make each Periodic Payment shall be discharged upon the

mailing of a valid check in the amount of such payment to the designated address of the Payee(s)

named in Section 2 of this Settlement Agreement. 

4. SETTLEMENT DISBURSEMENT FOR C.M.S. For purposes of this

agreement, the parties will refer to plaintiff Courtney Marie Steele as C.M.S.

The settlement amount of $400,000.00 for Plaintiff John DeMartini on behalf

of C.M.S. will be disbursed as follows:

A)Litigation Costs and Attorneys Fees: A total of $6,390.56 in litigation costs have

been incurred on behalf of plaintiff John DeMartini as Guardian ad litem for R.A.D and C.M.S. 

C.M.S.’s pro rata share of the total litigation costs equals $2,556.22. Plaintiff John DeMartini as

Guardian Ad Litem for R.A.D. and C.M.S. has a fee agreement with his attorneys Abbey

Weitzenberg Warren & Emery and Tibor Major for services provided in pursuing the subject claims

on a contingency fee basis for twenty five percent (25%) of the total recovery after reduction of

litigation costs. The attorneys fees for C.M.S.’s portion of the subject settlement proceeds is twenty

five percent (25%) of ($400,000.00 less $2,556.22 in litigation costs) or $99,360.95. Attorneys

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 7 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -8-

fees and Litigation Costs will be funded by a check from the United States of America made payable

to Abbey Weitzenberg Warren & Emery and Tibor Major in the sum of $101,917.16.

B) Purchase of an Annuity for the Benefit of C.M.S.: $275,479.30 of the

settlement proceeds will be paid by Nonprofits Insurance Alliance of California directly to American

General Annuity Service Corporation for the purchase an annuity for the benefit of C.M.S. as

compensation for the settlement of the above entitled action. The terms of the annuity are detailed

in Exhibit B.

C) Deposit into Blocked Account Available to C.M.S. at Age 18: The remaining

$22,603.54 of the settlement proceeds will paid by a check from the United States of America made

payable to C.M.S. and shall be deposited into an interest bearing federally insured account with the

San Francisco Police Credit Union located at 2550 Irving Street, San Francisco, California 94122,

which withdrawals will not be permitted until C.M.S turns eighteen (18) years of age.

4.1 Payments

In consideration of the release set forth above, NIAC and the United States agree to pay to

the individuals named below (the “payees”) the sums outlined in this section below:

4.2 Payments due at the time of settlement as follows:

(A) The United States will tender a check made payable for attorneys fees

and litigation costs to Abbey Weitzenberg Warren & Emery and

Tibor Major in the sum of $101,917.16.

(B) Nonprofits Insurance Alliance of California will purchase an annuity

for the cost of $275,479.30, payable directly to American General

Annuity Service Corporation, which an annuity will be for the benefit

of C.M.S. as compensation for the settlement of the above entitled

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 8 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -9-

action. 

C) The United States will tender a check made payable to C.M.S. in the

amount of $22,603.54 which will be delivered to her attorneys of

record for deposit in accordance with this stipulation. 

4.3 Periodic payments made according to the schedule as follows (the "Periodic

Payments"):

4.3b Payable to CMS:

$760.00 per month for the life of CMS, guaranteed 20 years, beginning on October

10, 2006, increasing at 2% compounding annually. Compounding benefits begin

October 10, 2007. The last guaranteed payment will be made on September 10,

2026.

$15,000.00 guaranteed lump sum payable on October 10, 2013.

$30,000.00 guaranteed lump sum payable on October 10, 2018.

$92,942.87 guaranteed lump sum payable on October 10, 2023.

4.4 Payee’s Rights to Payments

Plaintiffs acknowledges that the Periodic Payments cannot be accelerated, deferred,

increased or decreased by the Plaintiffs or any payee, nor shall the plaintiffs or any payee have the

power to sell, mortgage, encumber, or anticipate the Periodic Payments, or any part thereof, by

assignment or otherwise. 

4.5 Payee’s Beneficiary

Any payments to be made after the death of any Payee(s) pursuant to the terms of this

Settlement Agreement shall be made to such person or entity as shall be designated in writing by

Plaintiff(s) to the insurer or the Insurer's Assignee. If no person or entity is so designated by

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 9 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -10-

Plaintiff(s), or if the person designated is not living at the time of the Payee's death, such payments

shall be made to the estate of the Payee. No such designation, nor any revocation thereof, shall be

effective unless it is in writing and delivered to the Insurer or the Insurer's Assignee. The

Designation must be in a form acceptable to the Insurer or the Insurer's Assignee before such

payments are made, but in no event shall the request of the payee be unreasonably withheld or

denied.

4.6 Consent to Qualified Assignment

4.6a Plaintiffs acknowledge and agree that the Defendants and/or the

Insurer may make a “qualified assignment”, within the meaning of

Section 130 of the Internal Revenue Code of 1986, as amended, of

the Defendants and/or the Insurer’s liability to make the Periodic

Payments set forth in Section 4.3b to American General Annuity

Service Corporation (“the Assignee”). The Assignee’s obligation for

payment of the Periodic Payments shall be no greater than that of the

Defendants and/or the Insurer (whether by judgment or agreement)

immediately preceding the assignment of the Periodic Payments

obligation. 

4.6b Any such assignment, if made, shall be accepted by the plaintiffs

without right of rejection and shall completely release and discharge

the Defendants and the Insurer from the Periodic Payments obligation

assigned to the Assignee. The Plaintiffs recognize that, in the event

of such an assignment, the Assignee shall be the sole obligor with

respect to the Periodic Payments obligation, and Plaintiffs agrees that

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 10 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -11-

such assignments shall constitute a full release and discharge of all

of the Defendants and Insurer’s obligations relative to the Periodic

Payments set forth above. 

4.7 Right to Purchase Annuity

The Defendants and Insurer, itself or through American General Annuity Service

Corporation (“the Assignee”) reserve the right to fund the liability to make the Periodic Payments

in Section 4.3b through the purchase of an annuity policy from American General Life Insurance

Company. The Assignee shall be the sole owner of the annuity policy and shall have all rights of

ownership. The assignee may have American General Life Insurance Company mail payments

directly to the Payee(s). The plaintiffs shall be responsible for maintaining a current mailing address

for Payee(s) with American General Annuity Service Corporation. 

4.8 Discharge of Obligation

The obligation of the assignee to make each Periodic Payment shall be discharged upon the

mailing of a valid check in the amount of such payment to the designated address of the Payee(s)

named in Section 2 of this Settlement Agreement. 

5. SETTLEMENT DISBURSEMENTS FOR B.I.S. The settlement amount

of $400,000.00 for Plaintiffs Irene Steele and Darryl Steele on behalf of B.I.S. will be disbursed as

follows:

A) Litigation Costs and Attorney Fees: A total of $2,354.60 in litigation

costs have been incurred on behalf of Plaintiffs Irene Steele and Darryl Steele on behalf of B.I.S.

 Plaintiffs Irene Steele and Darryl Steele as co-guardians ad litem for B.I.S. have a fee agreement

with their attorney Nold & Associates for services provided in pursuing the subject claims on a

contingency fee basis for twenty-five percent (25%) of the total recovery after reduction of litigation

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 11 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -12-

costs. The attorney fees for B.I.S.’ portion of the subject settlement proceeds is twenty five percent

(25%) of ($400,000.00 less $2,354.60 in litigation costs) or $99,411.35. Attorney fees and

Litigation Costs will be funded by a check from the United States of America made payable to Nold

& Associates, PLLC in the sum of $101,765.95.

B) Purchase of an Annuity for the Benefit of B.I.S.: $200,000.00 of the

settlement proceeds will be paid by Nonprofits Insurance Alliance of California directly to EPS

Settlements Group, Inc. for the purchase of an annuity for the benefit of B.I.S. as compensation for

the settlement of the above entitled action. The terms of the annuity are detailed in Exhibit C.

C) Deposit into Trust Account Available to B.I.S. at Age 18: The

remaining $98,234.05 of the settlement proceeds will be paid by a check from the United States of

America made payable to B.I.S. Marvin Steele, as guardian of B.I.S. will serve as Trustee over this

account at the First National Bank of Montana, Libby, Montana. 

5.1 Payments

In consideration of the release set forth above, NIAC and the United States agree to pay to

the individuals named below (the “payees”) the sums outlined in this section below:

5.2 Payments due at the time of settlement are as follows:

(A) The United States will tender a check made payable for attorneys

fees and litigation costs to Nold & Associates in the sum of

$101,765.95.

(B) Nonprofits Insurance Alliance of California will purchase an annuity

for the cost of $200,000.00, payable directly to EPS Settlements

Group, Inc. which annuity will be for the benefit of B.I.S. as

compensation for the settlement of the above entitled action.

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 12 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -13-

(C) The United States will tender a check made payable to B.I.S. in the

amount of $98,234.05 which will be delivered to her attorneys of

records for deposit in accordance with this stipulation.

5.3 Periodic payments made according to the schedule as follows (the

“Periodic Payments:):

5.3c Payable to B.I.S.:

$100,000.00 guaranteed lump sum payable on November 8, 2020

$150,000.00 guaranteed lump sum payable on November 8, 2026

$397,925.00 guaranteed lump sum payable on November 8, 2029

5.4 Payee’s Rights to Payments

Plaintiffs acknowledges that the Periodic Payments cannot be accelerated, deferred,

increased or decreased by the Plaintiffs or any payee, nor shall the plaintiffs or any payee have the

power to sell, mortgage, encumber, or anticipate the Periodic Payments, or any part thereof, by

assignment or otherwise. 

5.5 Payee’s Beneficiary

Any payments to be made after the death of any Payee(s) pursuant to the terms of this

Settlement Agreement shall be made to such person or entity as shall be designated in writing by

Plaintiff(s) to the insurer or the Insurer's Assignee. If no person or entity is so designated by

Plaintiff(s), or if the person designated is not living at the time of the Payee's death, such payments

shall be made to the estate of the Payee. No such designation, nor any revocation thereof, shall be

effective unless it is in writing and delivered to the Insurer or the Insurer's Assignee. The

Designation must be in a form acceptable to the Insurer or the Insurer's Assignee before such

payments are made, but in no event shall the request of the payee be unreasonably withheld or

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 13 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -14-

denied.

5.6 Consent to Qualified Assignment

5.6a Plaintiffs acknowledge and agree that the Defendants and/or the

Insurer may make a “qualified assignment”, within the meaning of

Section 130 of the Internal Revenue Code of 1986, as amended, of

the Defendants and/or the Insurer’s liability to make the Periodic

Payments set forth in Section 5.3a to Prudential Assigned Settlement

Servcies Corporation (“the Assignee”). The Assignee’s obligation

for payment of the Periodic Payments shall be no greater than that of

the Defendants and/or the Insurer (whether by judgment or

agreement) immediately preceding the assignment of the Periodic

Payments obligation. 

5.6b Any such assignment, if made, shall be accepted by the plaintiffs

without right of rejection and shall completely release and discharge

the Defendants and the Insurer from the Periodic Payments obligation

assigned to the Assignee. The Plaintiffs recognize that, in the event

of such an assignment, the Assignee shall be the sole obligor with

respect to the Periodic Payments obligation, and Plaintiffs agrees that

such assignments shall constitute a full release and discharge of all

of the Defendants and Insurer’s obligations relative to the Periodic

Payments set forth above. 

5.7 Right to Purchase Annuity

The Defendants and Insurer, itself or through Prudential Assigned Settlement Services

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 14 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -15-

Corporation (“the Assignee”) reserve the right to fund the liability to make the Periodic Payments

in Section 5.3a through the purchase of an annuity policy from The Prudential Insurance Company

of America. The Assignee shall be the sole owner of the annuity policy and shall have all rights of

ownership. The assignee may have The Prudential Insurance Company of America mail payments

directly to the Payee(s). The plaintiffs shall be responsible for maintaining a current mailing address

for Payee(s) with Prudential Assigned Settlement Services Corporation. 

5.8 Discharge of Obligation

The obligation of the assignee to make each Periodic Payment shall be discharged upon the

mailing of a valid check in the amount of such payment to the designated address of the Payee(s)

named in Section 5 of this Settlement Agreement. 

6. SETTLEMENT DISBURSEMENTS FOR CURTIS STEELE. The settlement

amount of $300,000.00 for Plaintiff Curtis Steele will be disbursed as follows:

A) Litigation Costs and Attorney Fees: A total of $7,798.97 in litigation

costs have been incurred on behalf of Plaintiff Curtis Steele. Plaintiff Curtis Steele has a fee

agreement with his attorney Nold & Associates for services provided in pursuing the subject claims

on a contingency fee basis for twenty-five percent (25%) of the total recovery after reduction of

litigation costs. The attorney fees for Curtis Steele’s portion of the subject settlement proceeds is

twenty five percent (25%) of ($300,000.00 less $7,798.97 in litigation costs) or $73,050.26.

Attorney fees and Litigation Costs will be funded by a check from the United States of America

made payable to Nold & Associates, PLLC in the sum of $80,849.22.

B) Medi-Cal Lien: Medi-Cal has asserted a lien against the settlement

proceeds of Plaintiff Curtis Steele in the amount of $108,433.09. 

C) Purchase of an Annuity for the Benefit of Curtis Steele: $100,000.00 of

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 15 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -16-

the settlement proceeds will be paid by Nonprofits Insurance Alliance of California directly to EPS

Settlements Group, Inc. for the purchase of an annuity for the benefit of Curtis Steele as

compensation for the settlement of the above entitled action. The terms of the annuity are detailed

in Exhibit D.

D) Deposit into Bank Account Belonging to Plaintiff Curtis Steele: The

remaining $10,717.69 of the settlement proceeds will be paid by a check from the United States of

America made payable to Curtis Steele and shall be deposited into an interest bearing federally

insured account with the Bank of America located at 500 Main Street in Lakeport, California. 

6.1 Payments

In consideration of the release set forth above, NIAC and the United States agree to

pay to the individuals named below (the “payees”) the sums outlined in this section below:

6.2 Payments due at the time of settlement are as follows:

(A) The United States will tender a check made payable for attorneys fees

and litigation costs to Nold & Associates in the sum of $80,849.22.

(B) Nonprofits Insurance Alliance of California will purchase an annuity

for the cost of $100,000.00, payable directly to EPS Settlements

Group, Inc., which annuity will be for the benefit of Curtis Steele as

compensation for the settlement of the above entitled action.

(C) The United States will tender a check made payable to Medi-Cal in

the amount of $108,433.09 which will be delivered to his attorneys

of records for disbursement in accordance with this stipulation.

(D) The United States will tender a check made payable to Curtis Steele

in the amount of $10,717.69 which will be delivered to his attorneys

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 16 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -17-

of records for deposit in accordance with this stipulation.

6.3 Periodic payments made according to the schedule as follows (the

“Periodic Payments:):

6.3d Payable to Curtis Steele.:

$795.00 per month, guaranteed for 15 years, beginning on September 1, 2006

6.4 Payee’s Rights to Payments

Plaintiffs acknowledges that the Periodic Payments cannot be accelerated, deferred,

increased or decreased by the Plaintiffs or any payee, nor shall the plaintiffs or any payee have the

power to sell, mortgage, encumber, or anticipate the Periodic Payments, or any part thereof, by

assignment or otherwise. 

6.5 Payee’s Beneficiary

Any payments to be made after the death of any Payee(s) pursuant to the terms of this

Settlement Agreement shall be made to such person or entity as shall be designated in writing by

Plaintiff(s) to the insurer or the Insurer's Assignee. If no person or entity is so designated by

Plaintiff(s), or if the person designated is not living at the time of the Payee's death, such payments

shall be made to the estate of the Payee. No such designation, nor any revocation thereof, shall be

effective unless it is in writing and delivered to the Insurer or the Insurer's Assignee. The

Designation must be in a form acceptable to the Insurer or the Insurer's Assignee before such

payments are made, but in no event shall the request of the payee be unreasonably withheld or

denied.

6.6 Consent to Qualified Assignment

6.6a Plaintiffs acknowledge and agree that the Defendants and/or the

Insurer may make a “qualified assignment”, within the meaning of

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 17 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -18-

Section 130 of the Internal Revenue Code of 1986, as amended, of

the Defendants and/or the Insurer’s liability to make the Periodic

Payments set forth in Section 6.3a to American General Annuity

Service Corporation (“the Assignee”). The Assignee’s obligation for

payment of the Periodic Payments shall be no greater than that of the

Defendants and/or the Insurer (whether by judgment or agreement)

immediately preceding the assignment of the Periodic Payments

obligation. 

6.6b Any such assignment, if made, shall be accepted by the plaintiffs

without right of rejection and shall completely release and discharge

the Defendants and the Insurer from the Periodic Payments obligation

assigned to the Assignee. The Plaintiffs recognize that, in the event

of such an assignment, the Assignee shall be the sole obligor with

respect to the Periodic Payments obligation, and Plaintiffs agrees that

such assignments shall constitute a full release and discharge of all

of the Defendants and Insurer’s obligations relative to the Periodic

Payments set forth above. 

6.7 Right to Purchase Annuity

The Defendants and Insurer, itself or through American General Annuity Service

Corporation (“the Assignee”) reserve the right to fund the liability to make the Periodic Payments

in Section 6.3a through the purchase of an annuity policy from American General Life Insurance

Company. The Assignee shall be the sole owner of the annuity policy and shall have all rights of

ownership. The assignee may have American General Life Insurance Company mail payments

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 18 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -19-

directly to the Payee(s). The plaintiffs shall be responsible for maintaining a current mailing address

for Payee(s) with American General Annuity Service Corporation. 

6.8 Discharge of Obligation

The obligation of the assignee to make each Periodic Payment shall be discharged upon the

mailing of a valid check in the amount of such payment to the designated address of the Payee(s)

named in Section 6 of this Settlement Agreement. 

7. The parties agree that the district court shall retain jurisdiction over this matter for

the purposes of resolving any dispute alleging a breach of this Stipulation and

Agreement. 

8. Each party acknowledges that they have been represented by and have relied upon

independent counsel in negotiating, preparing and entering into this Stipulation and

Agreement and that they have had the contents of this Stipulation and Agreement

fully explained by counsel and that they are fully aware of and understand all of the

terms of the agreement and the legal consequences thereof. It is further

acknowledged that the parties have mutually participated in the drafting of this

Stipulation and Agreement and it is agreed that no provision herein shall be

construed against any party hereto by virtue of the drafting of this Stipulation and

Agreement. 

9. If any provision of this Stipulation and Agreement shall be held invalid, illegal, or

unenforceable, the validity, legality, and enforceability of the remaining provisions

shall not in any way be affected or impaired thereby. This instrument together with

the Stipulation and Order Approving Settlement, filed June 28, 2006 and approved

by the Court on June 29, 2006 (See Action 05-2511, Docket entry #60), which is

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 19 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -20-

incorporated herein by reference, shall constitute the entire agreement between the

parties. It is expressly understood and agreed that this agreement has been freely and

voluntarily entered into by the parties hereto with the advice of counsel, who have

explained the legal effect of this agreement. The parties further acknowledge that no

warranties or representations have been made on any subject other than as set forth

in this agreement. 

10. The parties agree that, should any dispute arise with respect to the implementation

of the terms of this Agreement, Plaintiffs shall not seek to rescind the Agreement and

pursue any of the original causes of action. Plaintiffs’ sole remedy in such a dispute

is an action to enforce the Agreement in district court. This settlement agreement

may be signed in counterparts. 

11. The parties further agree that the filing of this executed Stipulation and 

Agreement shall notify the Court of the parties’ agreement to vacate all pending

discovery, motion hearing dates, settlement or pretrial deadlines or trial date

associated with this litigation, but this provision does not indicate any agreement to

dismiss NIAC’s complaint-in-intervention. 

12. The parties to this stipulation request that the Court sign the proposed order

approving the disbursement of funds in settlement and the compromise of the minor

plaintiff’s settlements.

13. Tibor Major has asserted a lien against the attorneys fees portion of the settlement

proceeds of B.I.S. That lien is disputed. David Nold has agreed to deposit the sum

of $13,600 into his law firm trust account pending the decision of this court

regarding such lien. In the event that no action is taken to enforce such lien by

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 20 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -21-

September 1, 2006 then such amount may be removed from the trust account and the

lien shall be of no further force or effect.

14. The parties request that the Court, on the basis of this stipulation and the attached

supporting materials and documentation of disbursements to plaintiffs in the future,

approve the settlement without a hearing. 

SO STIPULATED.

DATED: July 28, 2006 /s/ 

Curtis Steele, Plaintiff 

DATED: July 28, 2006 /s/ 

Irene Steele, Plaintiff Guardian Ad Litem 

on behalf of B.I.S.

DATED: July 28, 2006 /s/ 

Darryl Steele, Plaintiff Guardian Ad Litem 

on behalf of B.I.S.

DATED: July 28, 2006 NOLD & ASSOCIATES, PLLC

 /s/ 

David A. Nold, pro hac vice, WSBA #19009

Attorney for Plaintiffs Curtis Steele and Irene and

Darryl Steele as Co-Guardians ad Litem for B.I.S.

DATED: July 28, 2006 LAW OFFICES OF MARK C. LAMB

 /s/ 

Mark C. Lamb, Esq.

Attorney for Plaintiffs Curtis Steele and Irene and

Darryl Steele as Co-Guardians ad Litem for B.I.S.

DATED: July 27, 2006 /s/ 

John DeMartini, Plaintiff Guardian Ad Litem for 

R.A.D. and C.M.S.

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 21 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

Case No. C 05-2511 TEH -22-

DATED: July 27, 2006 /s/ 

Plaintiff John DeMartini, As Personal Representative

of the Estate of Tracy DeMartini and/or Successor-InInterest to Tracy DeMartini

DATED: July 27, 2006 ABBEY WEITZENBERG WARREN & EMERY

 /s/ 

Michael D. Green, Esq.

Attorney for Plaintiff John DeMartini as Guardian ad

Litem for R.A.D. and C.M.S

DATED: July 27, 2006 LAW OFFICES OF TIBOR E. MAJOR

 /s/ 

Tibor E. Major, Esq.

Attorney for Plaintiff John DeMartini as Guardian ad

Litem for R.A.D. and C.M.S

DATED: July 31, 2006 CLAPP, MORONE Y, BELLAGAMBA &

VUCINICH

 /s/ 

Christopher J. Beeman, Esq.

Erica Berterello, Esq.

Attorneys for Defendant UNITED STATES

DATED: July 28, 2006 HAIGHT BROWN & BONESTEEL LLP

 /s/ 

Robert N. Schiff 

Attorneys for NONPROFITS’ INSURANCE

ALLIANCE OF CALIFORNIA

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 22 of 23
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

STIPULATION OF SETTLEMENT AND DISBURSEMENT TO PLAINTIFFS; ORDER

C05-02511 TEH -23-

DATED: July 28, 2006 KEVIN V. RYAN

United States Attorney

 /s/ 

Jonathan U. Lee

Assistant United States Attorney

Attorneys for Defendant UNITED STATES

PURSUANT TO STIPULATION, IT IS SO ORDERED:

DATED: __________________ _____________________________________

The Honorable Thelton E. Henderson

UNITED STATES DISTRICT JUDGE 

08/02/06

Case 3:05-cv-02511-TEH Document 70 Filed 08/03/06 Page 23 of 23