Life Partners Libel Suit Victory in Jeopardy; Technicality May Wipe Out $3 Million Judgment.

WACO, Texas--(BUSINESS WIRE)--April 15, 1999--

Last week, the 170th Judicial District Court in Waco, Texas, ruled that self-proclaimed viatical expert Gloria Grenning Wolk and Bialkin Books had published numerous false and misleading statements about Life Partners, Inc. (LPI) and ordered them to pay the company $3 million in damages.

The court also awarded extensive injunctive relief to LPI. But, according to attorneys for the company, the ruling may be in jeopardy due to a technicality after an attorney for the author filed a motion to vacate the judgment. The motion claims that the Texas Court does not have jurisdiction in this case and that Wolk's signature does not appear on a certified postal receipt of service. Court records indicate that a summons, sent by certified mail with restricted delivery, was delivered to Wolk's address on March 5, 1999. Records also indicate someone other than Wolk signed the receipt, but did not indicate whether that person was authorized to accept service for Wolk or Bialkin Books. Postal regulations prohibit the interception of mail, but permit its receipt by an authorized agent of an addressee.

Because the court found defamatory and malicious statements about LPI in the books "Cash for the Final Days" and "Viatical Settlements: An Investor's Guide" as well as the website www.viatical-expert.net, it ordered Wolk and Bialkin Books, jointly and severely, to pay $1.5 million in actual damages and another $1.5 million in punitive damages to LPI.

Texas State District Judge Joe Johnson also issued a halt to the sale of the books and ordered that any false, misleading or derogatory statements about LPI be removed from Wolk's website. Among Wolk's statements deemed false and defamatory by the Court were the claims that Life Partners is the "most notorious illegal viatical company," that clients of LPI "have lost $80 million," and that "LPI keeps defying state laws."

The court also found other defamatory and slanderous comments by Wolk such as: "LPI has vowed never to be licensed," "LPI lacks a viatical settlement company license," (LPI is in fact a licensed viatical settlement funding company) and "LPI has injured many viators by not paying their viatical settlements in full or paying them in installments." Furthermore, the court found that Life Partners' claim of being the oldest and largest viatical settlement is not false.

In addition to these findings, Judge Johnson also found that Wolk had "displayed no expertise in the field of viatical settlements through either of her books" or through the published content of her website.

Although LPI is confident Judge Johnson ruled correctly in the case, officials for the company are disappointed that the judgement could be voided by a technicality that has no bearing on the merits of the case. If voided, the company says it will continue the suit, seek greater damages as they occur, and possibly expand the case to include distributors and sellers of the book.

NO. 99-181-4

-------- LIFE PARTNERS, INC. IN THE DISTRICT COURT OF

Plaintiff

VS. McLENNAN COUNTY, TEXAS 

GLORIA GRENNING WOLK and BIALKIN BOOKS 170th JUDICIAL DISTRICT

Defendants

ORDER ON DAMAGES

----------------

----------------

On the 1st day of April, 1999, this Court awarded judgment by default to Plaintiff, Life Partners, Inc. (hereafter "LPI") and, the damages in the above-entitled and numbered cause being unliquidated, ordered that a hearing regarding damages be held.

The Court has read the pleadings and the papers on file, and is of the opinion that the allegations of plaintiff's petition have been admitted and, after hearing and considering the evidence presented to the Court this day, the Court makes the following findings of fact:

1. Defendants, jointly and severally, have published numerous false

and misleading statements regarding Life Partners, Inc. which are

contained in the books "Cash for the Final Days" and "Viatical

Settlements: An Investor's Guide" and on the website

www.viatical-expert.net which statements were defamatory and

defamatory per se, constitute slander, slander per se, libel,

libel per se and were made with malicious intent to harm the

business and reputation of LPI and to dissuade persons who might

engage in business relations with LPI from doing so.

2. The Court further finds that the following statements or

omissions by Defendants are false, misleading and derogatory, are

defamatory per se and constitute slander per se and libel per se:

a. LPI is "the most notorious illegal viatical company to exist

on a continuing basis in the U.S."

b. Clients of LPI have lost over $80,000,000.

c. LPI has injured many viators by not paying their viatical

settlements in full or paying them in installments.

d. LPI lacks a viatical settlement company license.

e. The omission of LPI from the author's list of "Legitimate

Viatical Companies" on the Website.

f. A Federal District Judge has ruled that LPI has "the right

to defy state viatical laws and operate where and how it

pleases" and that the judge "decided that states do not have

the right to protect people who sell the death benefits of

their life insurance."

g. LPI has vowed never to be licensed.

h. LPI keeps defying state laws.

i. LPI's claim that it is the oldest and largest viatical

settlement company is false.

j. LPI's purchase of policies from New York residents is in

violation of New York state law.

k. LPI did not help a viator by purchasing his policy at a fair

market price after the viator had transferred his policy to

another viatical company with then refused or was unable to

pay him.

l. The inclusion of details of allegations brought by the

Securities and Exchange Commission in its action against LPI

without the clear statement that said action was dismissed

with prejudice by the U.S. District Court in Washington,

D.C. after the Circuit Court of Appeals for the District of

Columbia found that LPI's viatical settlement transactions

did not constitute securities and that the Securities and

Exchange Commission had no jurisdiction to file its case

against LPI. This slander by omission clearly leaves the

reader with the impression that the SEC was successful in

its action against LPI when, in fact, the opposite is true.

3. The Court further finds that such defamatory and slanderous

statements have resulted in damage to the business and reputation

of Life Partners, Inc. and will continue to damage the business

and reputation of Life Partners, Inc. unless Defendants are

enjoined from the further dissemination of such statements.

4. The Court further finds that, because the said libelous and

slanderous statements were made intentionally, exemplary and

punitive damages are appropriate in order to dissuade Plaintiffs

and others similarly situated from engaging in a like or similar

manner.

5. The Court further finds that Defendant Gloria Grenning Wolk has

displayed no expertise in the field of viatical settlements

through either of her books "Cash for the Final Days" and

"Viatical Settlements: An Investor's Guide" or through the

published content of Defendants' website.

6. The Court further finds that Plaintiff should recover reasonable

attorney's fees in connection with this action which the Court

finds to be Five Thousand Dollars ($5,000.00).

IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED:

1. That Plaintiff have and recover from Defendants, jointly and

serverally, actual damages in the amount of One Million Five

Hundred Thousand Dollars ($1,500,000) together with

post-judgment interest thereon at the rate of Ten Percent (10%)

per annum from the date of this judgment until paid; and

2. That Plaintiff is further awarded, jointly and serverally against

Defendants, punitive and exemplary damages in the amount of One

Million Five Hundred Thousand Dollars ($1,500,000) together with

post-judgment interest thereon at the rate of Ten Percent (10%)

per annum from the date of this judgment until paid; and

3. That Defendants and those in active concert therewith are hereby

enjoined from making, publishing or distributing any false,

misleading and defamatory statements about Plaintiff whether

orally, in print, electronically or utilizing any other form of

communication whether now known or developed in the future

including, but not limited to, any and all copies of the books

"Cash for the Final Days" and "Viatical Settlements: An

Investor's Guide" unless such false, misleading or derogatory

statements about Plaintiff have been excised from said books.

4. That, in order to insure the cessation of any further

dissemination of the false, misleading or defamatory statements,

Defendants and those in active concert with them are hereby

ordered to turn over to Plaintiff each and every undistributed 

copy of the books "Cash for the Final Days" and "Viatical

Settlements: An Investor's Guide" which are within their custody

or control unless such false, misleading or derogatory statements

about Plaintiff have been excised from said books.

5. That Defendants and those in active concert with them are further

ordered to remove any and all false, misleading or defamatory

statements from the website www.viatical-expert.net or any other

website under the control of Defendants now or in the future and

from publishing, selling or distributing any books or

publications (including electronic publications) in which such

statements are made; and

6. That LPI have and recover from Defendants, jointly and severally,

all costs and fees incurred in prosecuting this action, including

reasonable attorneys' fees of $5,000.00 together with

post-judgment interest thereon at the rate of Ten Percent (10%)

per annum from the date of this judgment until paid.

Plaintiff is allowed such writs and processes as may be necessary in the enforcement and collection of this judgment.

SIGNED THIS 9th DAY OF APRIL, 1999.

(signed) Joe N. Johnson JUDGE PRESIDING