SUPREME COURT OF THE STATE OF NEW YORK 

COUNTY OF NEW YORK ........................................................................ X 

THE PEOPLE OF THE STATE OF NEW YORK 

by ELIOT SPITZER, Attorney General of 

the State of New York, : Index No. 404620106 

Part 39 

Plaintiff, 

Justice Helen E. Freedman 

-againstAFFIDAVIT OF DAVID AXINN 

: IN OPPOSITION TO COVENTRY 

COVENTRY FIRST LLC, MONTGOMERY FIRST AND REID S. BUERGER 

CAPITAL, INC., THE COVENTRY GROCTP, INC., and : MOTION TO DISMISS 

REID S. BCTERGER, 

Defendants. ........................................................................ X 

State of New York ) 

) ss.: 

County of New York ) 

DAVID AXINN, being duly sworn, deposes and says: 

1. I am an assistant attorney general in the office of Andrew M. Cuomo, the 

Attorney General of the State New York, and attorney for the People of the State of New York 

("State"), plaintiff in this action. I submit this affidavit in opposition to the Joint Motion of 

Coventry First and Reid S. Buerger to Dismiss the Complaint, and to put before the Court true 

and accurate copies of additional documents to be considered in connection with the Complaint 

on the present motion to dismiss. See International Oil Field Supply SVCS. Corn. V. Fadeyj No. 

5991104,2006 NY Slip Op 9173, at *3 (2d Dep't Dec. 5, 2006) ("[oln a CPLR 321 1 (a)(7) 

motion to dismiss, the facts alleged in the complaint must be accepted as true, and the court may 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 1 of 20
fieely consider additional facts contained in affidavits submitted by the plaintiff to remedy any 

defects in the complaint")(citing Leon v. Martinez, 84 N.Y.2d 83, 87-88 (1994)); Rove110 v. 

Orofino Realtv Co., 40 N.Y.2d 633,635 (1976). 

2. Attached hereto as Exhibit A is a copy of the Complaint filed in this action. 

3. In the course of the investigation leading up to the filing of the complaint in this 

action, Coventry provided the State with an Excel spreadsheet containing information on the life 

settlement transactions that Coventry has completed between 2001 and March 31,2006. The 

spreadsheet contains data on 3,469 separate life settlement transactions. Attached hereto as 

Exhibit B is an excerpt of the Coventry spreadsheet sorted to indicate that of these 3,469 

transactions, 298 of the life insurance policies were owned by New York sellers. 

4. Attached hereto as Exhibit C is an excerpt of the Coventry spreadsheet sorted to 

indicate that an additional 60 policies purchased by Coventry were not owned by a New Yorker 

but insured the life of a New Yorker. 

5. Attached hereto as Exhibit D are 10 emails produced from the files of Coventry 

First and AllSettled containing encoded emails concerning the payment of co-broker fees. Upon 

information and belief, these encoded emails evidence co-broker transactions requiring 

AllSettled to refrain fiom competitive bidding on the policy and to permit Coventry to obtain the 

bid in return for the co-broker fee. 

6. Attached hereto as Exhibit E is the Joint SEC/NASD Staff Report on Examination 

Findings Regarding Broker-Dealer Sales of Variable Insurance Products, dated June 9,2004. 

7. Attached hereto as Exhibit F is a NASD Notice to Members, dated August 2006. 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 2 of 20
Dated: New York, New York 

March 14,2007 

ANDREW M. CUOMO 

Attorney General of the 

State of New York 

By: 

DAVID AXINN 

Assistant Attorney General 

120 Broadway 

New York, New York 10271 

(212) 416-6277 

Sworn to before me 

this 14th day of March, 2007 

~s8stant ~ttorn& General 

Pursuant to Executive Law Section 73 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 3 of 20
EXHIBIT B 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 4 of 20
REDACTE

D

REDACTE

D

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 5 of 20
REDACTED

REDACTED

REDACTED

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 6 of 20
REDACTED REDACTED

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 7 of 20
EXHIBIT C 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 8 of 20
REDACTED REDACTED

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 9 of 20
EXHIBIT D 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 10 of 20
From: Neal Jacobs 

Sent: Tuesday, November 02,2004 9: 11: 11 AM 

~o:~allsettled.com; 

Subject: RE: 

- 

for a the number is 49 

Neal Jacobs 

Director, Financial UndeMiriting 

Coventry First 

71 11 Valley Green Road 

Fort Washington, PA 19034 

TEL I!- 

coventrvfirst.coq 

www.coventrvfirst.coq 

FAX - 

This transmission contains proprietary, confidential andlor privileged information which may be 

read andlor used only if received by the intended recipient. Any dissemination, distribution or 

copying of this e-mail, and any attachments thereto by unauthorized users is strictly prohibited. If 

n 

you have received this email in error, please respond to the sender or call us collect at - 

COVNJ 00008934 

Cnnf i dent i a 1 /Trade Spr-rpts 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 11 of 20
From: Neal Jacobs 

Sent: Thursday, December 16,2004 11:25:52 AM 

~oallsettled.com; 

Subject: - - 

number is 200 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

71 11 Valley Green Road 

Fort Washington. PA 19034 

TEL 

mcoventrvfirst.com 

www.coventrvfirst 

FAX - 

.com 

This transmission contains proprietary, confidential and/or privileged information which may be 

read and/or used only if received by the intended recipient. Any dissemination, distribution or 

copying of this e-mail, and any attachments thereto by unauthorized users is strictly prohibited. If - you have received this email in error, please respond to the sender or call us collect at - 

COVNJ 00010364 

re-&< An-+< 7 1 /Tv?An Caprate 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 12 of 20
... . - . . . . . . 

. . 

. . 

' . ~rh:~~al jacobr ' . . 

. Sent:Friday,January21,200511:35:16~M ..,. . . . . . . 

TO: ~illsmled.oom; Lenore Saracino . . ' 

' subject:- . . 

. . 

.. . the new number is 15 ' . ... .. . 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

7111 Valley Green Road 

Fort Washington. PA 19034 

-coventrvfirst.corr! 

TEL FAX E 

www.coventn/first.coql 

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COVNJ 00011464 

- - ...I-'._-, .- 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 13 of 20
From: Neal Jacobs 

Sent: Friday, April 22, 2005 12:01:24 PM 

To: Lenore Saracino 

Subject: 

number is 3 

Neal Jacobs 

Vice President, Financial Underwriting 

Coventry First 

711 1 Valley Green Road 

Fort Washington, PA 19034 

This transmission contains proprietary, confidential and/or privileged information which may be 

read and/or used only if received by the intended recipient. Any dissemination, distribution or 

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you have received this email in error, please respond to the sender or call us collect at 0 

R 

COVNJ 00016754 

Ccnfidential/Trade Secrets -- -. . -- - 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 14 of 20
F~A: Neal Ja* 

Sent: Thursday. June 23. ZOOS 12: 12:05 PM, 

To: Lenore Saracino 

Subject:- ' . 

for Jt Is 20. . 

Neal Jacobs 

Vice President, Financial Underwriting 

Coventry Fmt 

711 1 Valley Green Road 

Fort Washington, PA 19034 

T=- 

Bwventrvfirst.am 

FAX 0 

www.coventrvf~rst.com 

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- - --- COVNJ -- 00021572 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 15 of 20
I Sent: Friday, March 12, 2004 10:05 AM 

Subject:a 

I My apologies. We have some internal miscommunication. The number on -is 10. 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

71 11 Valley Green Road 

Fort Washington, PA 19034 

TEL 

FAXThis transmission contains proprietary, confidential andlor privileged information which may be read andlor 

used only if received by the intended recipient. Any dissemination, distribution or copying of this e-mail, and 

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please respond to the sender or call us collect at - 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 16 of 20
Subject: Fw: wj 

From: "Michael Krasnermann O)@allsenledconv 

Date: Wed, 14 Apr 2004 15:58:35 -0400 

To: "Lenore Saracino" ~allsettled.con~ 

X-UIDL: 257 

X-Mozilla-Status: 0001 

X-Mozilla-StatusZ: 00000000 

Return-Path: ~Ilsettled.com> 

Received: from [66.163.205.65] (HELO smtpauthl .radimt.ner) by mx2.radiant.net (CommuniGate Pro SMTP 4.1.8) with 

SMTP id 47676652 for ~allsettled.com; Wed, 14 Apr 2004 12:34:21 -0700 

Recelved: (qmail 23498 invoked from network); 14 Apr 2004 19:27:20 -0000 

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2004 19:27:20 -0000 

Message-ID: ~006801c4225a$dfDae250~0300a8~0@wks4, 

Organization: Allsettled Group, Inc. 

MIME-Version: 1.0 

Con tent-Type: mu1 tipartla1 ternativc; boundary="--=~NextPartartOOOOO065~Ol C42239.57952950" 

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-- Original Message - 

coven tryf1rst.com 

d.com ; @allseffled.com 

Sent: Wednesday, April 14,2004 3:22 PM 

Subject: 8 

as discussed, the number for is 2. 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

71 11 Valley Green Road 

Fort Weshington, PA 19034 

coventryfirst.com 

TEL 

FAX- 

- 

wwvv.coventrvfirst.com 

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respond to the sender or call us collect atCase 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 17 of 20
Subject: Fw: 

From: "mtt ~allsettled.com> 

Date: Thu, 22 Apr 2004 08:53:51 -0400 

To: "lenore saranclno" ~allsetrled.con~ 

X-UIDL: 484 

X-Mozilla-Status: 0001 

X-Mozilla-StatusZ: 00000000 

Return-Path: ~allsettled.co+ 

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Apr 2004 12:45:13 -0000 

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Sent: Wednesday, April 21,2004 550 PM 

subject:_ 

the number for 'is 10 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

71 1 1 Valley Green Road 

Fort Washinaton, PA 19034 

TEL 

www.coventrvfirst.com 

FAX - 

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' respond to the sender or call us collect at w 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 18 of 20
Subject: FW:~ 

From: "-' Q@allsettled.com> 

Date: Wed, 16 Jun 2004 13:57:46 -0500 

To: "lenorc sarancino" ~allsettled.com> 

X-UIDL: 1837 

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X-Mozilla-Status2: 00000000 

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Jun 2004 17:47:26 -0000 

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--- Original Message - 

~rorn:-coventryfirst com . - , 

To: ~@allsettled.corn ;~allsettled.corn 

Sent: Wednesday, June 16,2004 1254 PM 

subject:- 

the amount for is % point. 

Neal Jacobs 

Director, Financial Undenvriting 

Coventry First 

71 11 Valley Green Road 

Fort Washington. PA 19034 

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respond to the sender or call us collect atd 

Case 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 19 of 20
Page 1of 1 

Lenore Saracino 

From: - -allsettled.com> 

To: "lenore sarancino" <~allsettled.com> 

Sent: Tuesday. September 14,2004 6:34 PM 

Subject: Fw: 

--- Original Message --- 

~rom~@coventrvfirst corn 

To: ~&ettled.com ; m'aIIsettled.corn 

Sent: Tuesday, September 14,2004 6:10 PM 

subject: m 

for assuming final result is 15, the number is 20 

Neal Jacobs 

Director, Financial Underwriting 

Coventry First 

71 11 Valley Green Road 

Fort Washington, PA 19034 

~coventrvfirst.corn 

www.coventn/first.com 

TEL 

FAX 

- 

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respond to the sender or call us collect atCase 1:07-cv-03494-DLC Document 23-5 Filed 06/12/2007 Page 20 of 20