Third-party lending company Thrivest Specialty Funding has asked a federal appeals court to temporarily block the NFL concussion settlement claims administrator from paying injured players whose settlement funds might be subject to third-party funding agreements.
Thrivest, which is one of three third-party lenders pursuing an appeal over the validity of several funding agreements they have with injured NFL players potentially entitled to settlement funds, filed an expedited motion to the U.S. Court of Appeals for the Third Circuit on Feb. 19. The motion asks the appeals court to impose a stay on processing the payments pending the outcome of that appeal.
Thrivest said it filed its motion in the face of an early March deadline, which is when the claims administrator is expected to pay out on a claim to William Andrews, an injured ex-player who also entered into a lending agreement with the company. According to Thrivest, it was given March 8 as the date for when it could either waive its contract rights regarding the loan at issue—at which point the claims administrator would repay to Thrivest the principal on that agreement—or the claims administrator would pay out the entirety of the claim to Andrews.
“By threatening to release the disputed funds to Mr. Andrews while at the same time refusing to allow Thrivest to pursue recourse through arbitration, the district court has effectively forced Thrivest to risk another $117,374 (its principal, by the claims administrator’s calculation) on this appeal,” Thrivest’s attorney, Peter Buckley of Fox Rothschild, said in the filing. “Leveraging this flawed paradigm, which is at the heart of this appeal, to encourage Thrivest to forego its appellate rights is especially disconcerting.”
Last month, Thrivest and two other third-party funding companies argued before a Third Circuit panel that U.S. District Judge Anita Brody of the Eastern District of Pennsylvania did not have jurisdiction to rule in late 2017 that third-party funding agreements between players and lending companies like Thrivest should be voided under the class action settlement agreement.
The funding companies had contended that the settlement language only forbids agreements that assign a claimant’s tort claims, rather than monetary claims, to the lending companies. Thrivest had sought to arbitrate disputes with ex-players, but Brody had blocked those attempts as well.
In the appeal currently pending before the Third Circuit, the lending companies argued that Brody, who is overseeing the concussion litigation settlement, does not have jurisdiction to invalidate third-party funding agreements that were made outside the structure of the settlement.
According to Thrivest’s 13-page stay request, the company was notified Feb. 6 that the claims administrator had determined its agreement with Andrews was invalid. However, Thrivest contended it had not been aware that the claims administrator had been reviewing the agreement, and characterized the claim administrator’s decision as an “ex parte” determination.
The company also said it wrote to the district court the following day, requesting a conference to discuss possibly staying the process, or putting the disputed funds in escrow until the appeal was resolved, but, according to Thrivest, the court did not respond.
The company said the appeals court could either stay the process broadly or only with regard to Andrews’ claim. But no matter how it rules, Thrivest asked the appeals court to issue its decision before the March 8 deadline.
Buckley declined to comment beyond the filing, and co-lead class counsel Chris Seeger of Seeger Weiss did not return a message seeking comment.