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Descendants of Armenians killed in 1915 in what was then the Ottoman Empire have won a preliminary round in their class action fight to force New York Life Insurance Co. to pay benefits to insured victims’ families. New York Life sought to dismiss the suit, arguing that the insurance policies, purchased between 1875 and 1915, required litigation to be filed in France or England. The Armenian plaintiffs sued in U.S. District Court for the Central District of California, which in 2000 passed a law aimed at helping the plaintiffs file their suits in California courts to recover benefits. The plaintiffs assert their relatives were victims of genocide, a charge long denied by the Turkish Republic. New York Life argued, among other things, that California’s Armenian Genocide Victims Insurance Act impermissibly invades the federal government’s exclusive power over foreign policy and that it violates the due process clause by invalidating the policies’ venue provisions, said lead defense attorney John C. Holmes, partner at Barger & Wolen in Los Angeles. A federal judge recently rejected the insurer’s constitutional challenges and denied the dismissal motion, finding that it would be “fundamentally unfair” to enforce the policies’ venue provision. Marootian v. New York Life Insurance Co., No. CV-99-12073CAS (C.D. Calif.; Judge Christina A. Snyder.). New York Life vice president William Werfelman said the company planned to appeal. “New York Life believes the law and the facts are firmly on its side in this matter,” he said. The lead plaintiff in the case is Martin Marootian, who alleged that he and his mother, since deceased, corresponded with New York Life since policyholder Setrak Cheytanian, Marootian’s uncle, was killed in June 1915, but were unable to collect policy benefits as beneficiaries, the judge wrote. Plaintiff Sam Kadorian, a 93-year-old survivor who witnessed his father’s murder at a time when 1.5 million Armenians are said to have been killed, is still seeking to collect benefits from a policy purchased in 1912. A multimillion-dollar settlement of the case was widely reported in April, but was never concluded. Under that offer, New York Life agreed to pay claims and to contribute a minimum of $3 million to Armenian civic organizations. “Somebody jumped the gun,” said a lawyer for the plaintiffs, Vartkes Yeghiayan of Yeghiayan & Associates in Glendale, Calif., noting that the plaintiffs were unhappy with the offer. “It became apparent to us that the settlement was woefully inadequate,” said Mark J. Geragos of Geragos & Geragos in Los Angeles, another plaintiffs’ counsel. The settlement agreement was contingent upon plaintiffs’ counsel conducting a “due-diligence discovery,” he said. Helping to undo the settlement was a 1919 letter, the plaintiffs’ lawyers said, from New York Life’s general counsel to the U.S. State Department saying that the insurer’s exposure over the Armenians’ policies was about $7 million. Geragos estimates the present-day value of those benefits is about $100 million. The plaintiffs claim that the class has a potential 8,000 claimants, while the insurer says the number is closer to 3,000, the plaintiffs’ lawyers said. The decision could have a “significant impact” on other plaintiffs in insurance disputes, namely those seeking to recover benefits from Holocaust-era life insurance policies, said William M. Shernoff, senior partner at Shernoff Bidart & Darras in Los Angeles, who represents Armenian and Holocaust plaintiffs.

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