Court Opinion

ID: 9402796
Source: CourtListenerOpinion
Date Created: 2023-06-16 21:00:54.259144+00
Date Added: 2024-06-11T17:20:02.611202
License: Public Domain

USCA11 Case: 21-11340   Document: 57-1    Date Filed: 06/16/2023   Page: 1 of 6

                                                          [PUBLISH]
                                 In the
                United States Court of Appeals
                        For the Eleventh Circuit

                         ____________________

                              No. 21-11340
                         ____________________

       LUJERIO CORDERO,
                                                   Plaintiﬀ-Appellant,
       versus
       TRANSAMERICA ANNUITY SERVICE CORPORATION,
       a.k.a. Wilton Re Annuity Service Corporation,

                             Defendant-Third-Party Plaintiﬀ-Appellee,

       TRANSAMERICA LIFE INSURANCE COMPANY,

                                 Defendant-Cross Claimant-Appellee,
USCA11 Case: 21-11340          Document: 57-1      Date Filed: 06/16/2023      Page: 2 of 6

       2                           Opinion of the Court                 21-11340

       ALLIANCE ASSET FUNDING, LLC, et al.,

                                     Third-Party Defendants-Cross Defendants.

                                ____________________

                    Appeal from the United States District Court
                        for the Southern District of Florida
                       D.C. Docket No. 1:18-cv-21665-DPG
                             ____________________

       Before WILSON, ROSENBAUM, Circuit Judges, and CONWAY,∗ District
       Judge.
       PER CURIAM:
              Over the course of twenty-two months, plaintiﬀ-appellant
       Lujerio Cordero—a childhood victim of lead poisoning—assigned
       his rights to nearly one million dollars in structured settlement pay-
       ments to factoring companies for pennies on the dollar. Through
       six transfer agreements that he lacked the capacity to understand,
       Cordero relinquished his rights to monthly payments with a total
       aggregate value of $959,834.42 spread over the course of about
       twenty-six years for a series of immediate lump-sum cash payments
       that amounted to $268,130.

       ∗ Honorable Anne C. Conway, United States District Judge for the Middle Dis-

       trict of Florida, sitting by designation.
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       21-11340               Opinion of the Court                          3

              The six transactions at issue were facilitated under Florida’s
       Structured Settlement Protection Act (Florida’s “SSPA”), which
       states that a structured settlement payment rights transfer is only
       eﬀective if “the transfer is authorized in advance in a ﬁnal order by
       a court of competent jurisdiction[.]” Fla. Stat. § 626.99296(3)(a). At
       hearings where the factoring companies were the only represented
       parties, Florida state courts approved Cordero’s assignments. For
       each transfer, the Florida state court concluded—among other
       things—that the transfer was in Cordero’s best interest. See id.
              After Cordero exhausted his cash payments, he endeavored
       to recover the money that he assigned to the factoring companies.
       But, instead of suing the factoring companies or attempting to void
       the transactions, Cordero sued Transamerica Annuity Service Cor-
       poration and Transamerica Life Insurance Company (collectively,
       “Transamerica”), the entities that issued and funded his periodic
       payments before he assigned them. Cordero asserted two claims
       against Transamerica: one for breach of contract under New York
       law, and the other for exploitation of a vulnerable adult under Flor-
       ida’s Adult Protective Services Act (“FAPSA”), Florida Statute
       § 415.1111.
              This appeal followed the district court’s with-prejudice dis-
       missal of Cordero’s claims. It returns to us after the New York
       Court of Appeals answered a reformulated version of a question
       that we certiﬁed for its review. See Cordero v. Transamerica Annuity
       Serv. Corp., 34 F.4th 994 (11th Cir. 2022), certiﬁed question answered,
       No. 21, --- N.E.3d --- (N.Y. Apr. 25, 2023).
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       4                       Opinion of the Court                   21-11340

              Our certiﬁed question pertained to Cordero’s breach of con-
       tract claim. With the beneﬁt of oral argument, we concluded that
       one of Cordero’s theories of liability might be viable: a claim prem-
       ised on a breach of the implied covenant of good faith and fair deal-
       ing. However, we were unsure whether such a claim was actionable
       under New York law based on the facts of this case. Therefore, we
       certiﬁed the following question to the New York Court of Appeals:
              Does a plaintiﬀ suﬃciently allege a breach of the im-
              plied covenant of good faith and fair dealing under
              New York law if he pleads that the defendant drasti-
              cally undermined a fundamental objective of the par-
              ties’ contract, even when the underlying duty at issue
              was not explicitly referred to in the writing?

       Cordero, 34 F.4th at 1002. In its response, the New York Court of
       Appeals reformulated our question to read:
              Does a plaintiﬀ suﬃciently allege a breach of the cov-
              enant of good faith and fair dealing under New York
              law by pleading that (1) an issuer or obligor failed to
              object to plaintiﬀ’s sale of periodic payments in an
              SSPA proceeding, where the underlying agreements
              contain anti-assignment provisions, and (2) the sale
              approved by the SSPA court was not in the plaintiﬀ’s
              best interest?

       Cordero v. Transamerica Annuity Serv. Corp., No. 21, --- N.E.3d ---, slip
       op. at 9 (N.Y. Apr. 25, 2023). The New York Court of Appeals an-
       swered its reformulated question in the negative, concluding that
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       21-11340                  Opinion of the Court                               5

       “such allegations do not state a cognizable cause of action for
       breach of the implied covenant.” Id., slip op. at 2, 9.
              We oﬀer the New York Court of Appeals our sincerest
       thanks for its assistance. Given its guidance, we aﬃrm the district
       court’s with-prejudice dismissal of Cordero’s breach of contract
       claim.1
             One issue remains: whether Cordero has stated a claim
       against Transamerica pursuant to FAPSA for exploitation of a vul-
       nerable adult. We deferred our decision on this claim in our prior
       opinion. See Cordero, 34 F.4th at 996 n.2.
               Under FAPSA, a “vulnerable adult who has been abused, ne-
       glected, or exploited” may bring a civil lawsuit “against any perpe-
       trator.” Fla. Stat. § 415.1111. In deﬁning “exploitation,” the statute
       states that the exploiter must act “with the intent to temporarily or
       permanently deprive the vulnerable adult of the use, beneﬁt, or
       possession of [his] funds, assets, or property for the beneﬁt of
       someone other than the vulnerable adult.” Id. § 415.102(8)(a). Ex-
       amples of exploitation listed in the statute include “[b]reaches of
       ﬁduciary relationships,” “[u]nauthorized taking of personal assets,”
       “[m]isappropriation, misuse, or transfer of moneys belonging to a
       vulnerable adult from a personal or joint account,” or “[i]nten-
       tional or negligent failure to eﬀectively use a vulnerable adult’s

       1
         We recognize that Cordero made additional arguments regarding his breach
       of contract claim in his briefs; however, we find that those arguments are mer-
       itless. See Cordero, slip op. at 13–14.
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       6                         Opinion of the Court                       21-11340

       income and assets for the necessities required for that person’s sup-
       port or maintenance.” Id. § 415.102(8)(b).
               Cordero’s FAPSA claim fails under the plain language of the
       statute. In his operative complaint, Cordero does not allege that
       Transamerica intended to deprive him of the use of his funds. See
       id. § 415.102(8)(a). Instead, Cordero asserts that Transamerica “al-
       lowed” (or “facilitated”) his exploitation by the factoring compa-
       nies, which resulted in an unauthorized taking of his assets. Based
       on the facts that Cordero pleaded, Transamerica’s actions simply
       do not amount to “exploitation” as that term is deﬁned in FAPSA.
       Because Cordero has failed to state a violation of FAPSA, we aﬃrm
       the district court’s with-prejudice dismissal of his FAPSA claim.2
              For the reasons set forth above and in the New York Court
       of Appeals’ response to our certiﬁed question, we aﬃrm the district
       court’s dismissal of Cordero’s claims.3
              AFFIRMED.

       2
        “We may affirm for any reason supported by the record, even if not relied
       upon by the district court.” Hill v. Emp. Benefits Admin. Comm. of Mueller Grp.
       LLC, 971 F.3d 1321, 1325 (11th Cir. 2020) (internal quotation marks omitted).
       3
         The facts as Cordero has alleged them are truly troubling. They describe a
       situation where it appears an industry is able to systematically victimize indi-
       viduals who are not in a position to protect themselves. See Cordero, slip op.
       at 30 (Rivera, J., dissenting). But given the governing law, we cannot grant
       Cordero the relief that he seeks based on the claims that he asserted against
       Transamerica.