Beneficient Announces Agreement to Settle GWG Litigation
Beneficient (NASDAQ: BENF) has reached a binding agreement to settle all claims in the GWG Holdings litigation cases in federal courts. The settlement, which remains subject to court approval, will be funded entirely through insurance policy limits and resolves all claims against Beneficient, its subsidiaries, and their current and former directors and officers, including CEO Brad Heppner.
The company maintains its position of contesting all allegations, denying any wrongdoing, fault, or liability. The decision to settle was strategically made to eliminate ongoing costs, distractions, and litigation risks. While this settlement resolves claims against Beneficient parties, other GWG-related claims against non-Beneficient parties remain outstanding, including claims against entities related to the founder and CEO, to whom Beneficient has indemnification obligations.
Beneficient (NASDAQ: BENF) ha raggiunto un accordo vincolante per risolvere tutte le controversie nei casi di contenzioso di GWG Holdings nei tribunali federali. L'accordo, che è soggetto all'approvazione del tribunale, sarà interamente finanziato attraverso i limiti delle polizze assicurative e risolve tutte le richieste contro Beneficient, le sue filiali e i loro attuali ed ex direttori e funzionari, incluso il CEO Brad Heppner.
L'azienda mantiene la sua posizione di contestare tutte le accuse, negando qualsiasi illecito, colpa o responsabilità. La decisione di risolvere è stata presa strategicamente per eliminare costi, distrazioni e rischi legali in corso. Sebbene questo accordo risolva le richieste contro le parti di Beneficient, altre richieste correlate a GWG contro parti non Beneficient rimangono pendenti, incluse le richieste contro entità legate al fondatore e CEO, per le quali Beneficient ha obblighi di indennizzo.
Beneficient (NASDAQ: BENF) ha alcanzado un acuerdo vinculante para resolver todas las reclamaciones en los casos de litigio de GWG Holdings en los tribunales federales. El acuerdo, que está sujeto a la aprobación del tribunal, será financiado completamente a través de los límites de la póliza de seguro y resuelve todas las reclamaciones contra Beneficient, sus subsidiarias y sus actuales y anteriores directores y funcionarios, incluido el CEO Brad Heppner.
La compañía mantiene su posición de impugnar todas las acusaciones, negando cualquier mala conducta, culpa o responsabilidad. La decisión de llegar a un acuerdo se tomó estratégicamente para eliminar costos, distracciones y riesgos de litigio en curso. Si bien este acuerdo resuelve las reclamaciones contra las partes de Beneficient, otras reclamaciones relacionadas con GWG contra partes no Beneficient siguen pendientes, incluidas las reclamaciones contra entidades relacionadas con el fundador y CEO, para las cuales Beneficient tiene obligaciones de indemnización.
Beneficient (NASDAQ: BENF)는 연방 법원에서 GWG Holdings 소송 사건의 모든 청구를 해결하기 위한 구속력 있는 계약을 체결했습니다. 법원의 승인을 받아야 하는 이 합의는 보험 정책 한도를 통해 전액 자금이 지원되며, Beneficient, 그 자회사 및 현재 및 이전 이사와 임원, CEO인 Brad Heppner에 대한 모든 청구를 해결합니다.
회사는 모든 혐의에 대해 이의를 제기하며, 어떠한 잘못이나 책임도 부인하고 있습니다. 합의 결정을 내린 것은 지속적인 비용, 방해 및 소송 위험을 없애기 위한 전략적 선택이었습니다. 이 합의가 Beneficient 당사자에 대한 청구를 해결하지만, 비Beneficient 당사자에 대한 GWG 관련 청구는 여전히 남아 있으며, Beneficient가 면책 의무를 지고 있는 창립자 및 CEO와 관련된 법인에 대한 청구도 포함됩니다.
Beneficient (NASDAQ: BENF) a conclu un accord contraignant pour régler toutes les réclamations dans les affaires de litige de GWG Holdings devant les tribunaux fédéraux. L'accord, qui reste soumis à l'approbation du tribunal, sera entièrement financé par les limites de la police d'assurance et résout toutes les réclamations contre Beneficient, ses filiales et leurs administrateurs et dirigeants actuels et anciens, y compris le PDG Brad Heppner.
L'entreprise maintient sa position de contester toutes les allégations, niant toute faute, responsabilité ou mauvaise conduite. La décision de régler a été prise stratégiquement pour éliminer les coûts, distractions et risques de litige en cours. Bien que cet accord résolve les réclamations contre les parties de Beneficient, d'autres réclamations liées à GWG contre des parties non-Beneficient restent en suspens, y compris les réclamations contre des entités liées au fondateur et PDG, pour lesquelles Beneficient a des obligations d'indemnisation.
Beneficient (NASDAQ: BENF) hat eine verbindliche Vereinbarung zur Beilegung aller Ansprüche in den GWG Holdings Rechtsstreitigkeiten vor den Bundesgerichten getroffen. Die Einigung, die der Genehmigung durch das Gericht unterliegt, wird vollständig durch Versicherungspolicen finanziert und löst alle Ansprüche gegen Beneficient, deren Tochtergesellschaften sowie deren aktuelle und ehemalige Direktoren und Führungskräfte, einschließlich CEO Brad Heppner.
Das Unternehmen hält an seiner Position fest, alle Vorwürfe zu bestreiten und jegliches Fehlverhalten, Verschulden oder Haftung zu leugnen. Die Entscheidung zur Einigung wurde strategisch getroffen, um laufende Kosten, Ablenkungen und Rechtsrisiken zu beseitigen. Während diese Einigung die Ansprüche gegen Beneficient-Parteien löst, bleiben andere GWG-bezogene Ansprüche gegen nicht-Beneficient-Parteien ausstehend, einschließlich Ansprüche gegen mit dem Gründer und CEO verbundene Unternehmen, für die Beneficient Entschädigungspflichten hat.
- Settlement funded entirely through insurance policies, protecting company cash
- Elimination of major litigation risk and associated legal costs
- No admission of wrongdoing in settlement terms
- Ongoing indemnification obligations for claims against founder-related entities
- Settlement subject to court approval and other conditions
- Continued existence of other GWG-related claims against non-Beneficient parties
Insights
Beneficient's settlement of the GWG litigation represents a significant risk reduction with minimal financial impact on the company. The key advantage here is that the settlement will be paid
The litigation resolution removes a substantial uncertainty overhang that likely impacted investor sentiment. By ending these legal proceedings without admission of wrongdoing, BENF can redirect both financial resources and management attention from legal defense toward executing its core business strategy in the alternative asset liquidity space.
However, investors should note the settlement doesn't completely eliminate legal exposure. The disclosed indemnification obligations to entities related to the founder/CEO for remaining GWG claims represent a continuing contingent liability. Without quantification of these obligations, it's difficult to assess their materiality relative to Beneficient's overall financial position.
From a risk management perspective, this represents efficient resolution of a significant liability - capping potential damages at insurance policy limits eliminates the unpredictable outcomes of continued litigation. The removal of this legal uncertainty should improve the company's operational focus and potentially enhance its strategic options going forward.
This settlement strategically eliminates both federal and bankruptcy court litigation exposure for Beneficient and its entire leadership ecosystem without requiring admission of liability - a textbook risk management approach. The comprehensive protection extends to the company, subsidiaries, and all current/former directors and officers, creating a clean legal slate regarding the GWG allegations.
The structure - settlement within insurance limits pending court approval - represents standard practice for resolving complex multi-party litigation efficiently. While the company maintains its innocence, this pragmatic resolution recognizes that even defensible cases carry unpredictable risks, ongoing legal costs, and management distraction.
The remaining claims against parties related to the founder/CEO create a secondary legal exposure through the company's indemnification obligations. These arrangements warrant investor scrutiny as they represent a continuing contingent liability that's difficult to quantify without additional disclosure. The company's commitment to "support a vigorous defense" signals ongoing legal involvement and potential costs, though likely less significant than the primary litigation.
Court approval represents the final hurdle, but objections appear unlikely given the insurance funding mechanism avoids adverse impact on either the company's finances or other claimants. This settlement effectively transforms an unpredictable legal liability into a defined, insured obligation - significantly reducing both financial and reputational risk for Beneficient.
DALLAS, March 10, 2025 (GLOBE NEWSWIRE) -- Beneficient (NASDAQ: BENF) (“Beneficient,” “Ben” or the “Company”), a technology-enabled platform providing exit opportunities and primary capital solutions and related trust and custody services to holders of alternative assets through its proprietary online platform, AltAccess, today announced that it has entered into a binding agreement to settle all claims in the previously disclosed lawsuits relating to GWG Holdings, Inc. (“GWG”) in federal court in the Northern District of Texas and the Bankruptcy Court for the Southern District of Texas (“GWG Litigation”) against the Company, its subsidiaries, and each of their current and former directors and officers, including its founder and CEO, Brad Heppner (collectively, the “Beneficient Parties”), for a sum within applicable insurance policy limits.
The Company and its directors and officers have vigorously contested and continue to contest the allegations in the GWG Litigation, fundamentally challenging the underlying factual assertions and maintaining substantive and well-founded defenses. The Company’s decision to enter into this settlement agreement was based on eliminating ongoing costs, distractions, and other risks inherent in litigation.
The proposed settlement, which is subject to court approval and other conditions, would resolve all claims asserted against the Beneficient Parties without any admission, concession or finding of any fault, liability or wrongdoing by the Company or any defendant. Under the terms of the proposed settlement, the plaintiffs will receive an agreed upon amount of cash that will be paid entirely from funds available under applicable insurance policies.
“While the Company thoroughly disputes the allegations in the GWG Litigation, we are pleased to have reached this agreement. Today’s announcement is a major step toward allowing us to move past this matter so we can continue focusing on executing on our business plan and enhancing shareholder value,” said a Company spokesperson.
Following the settlement of the GWG Litigation, other GWG-related claims against parties other than the Company, its subsidiaries, and each of their current and former directors and officers, including its founder and CEO, remain outstanding, including certain claims against entities related to Beneficient’s founder and CEO to whom Beneficient owes certain indemnification obligations. The Company intends to support a vigorous defense against such claims.
About Beneficent
Beneficient (Nasdaq: BENF) – Ben, for short – is on a mission to democratize the global alternative asset investment market by providing traditionally underserved investors − mid-to-high net worth individuals, small-to-midsized institutions and General Partners seeking exit options, anchor commitments and valued-added services for their funds− with solutions that could help them unlock the value in their alternative assets. Ben’s AltQuote™ tool provides customers with a range of potential exit options within minutes, while customers can log on to the AltAccess® portal to explore opportunities and receive proposals in a secure online environment.
Its subsidiary, Beneficient Fiduciary Financial, L.L.C., received its charter under the State of Kansas’ Technology-Enabled Fiduciary Financial Institution (TEFFI) Act and is subject to regulatory oversight by the Office of the State Bank Commissioner.
For more information, visit www.trustben.com or follow us on LinkedIn.
Contacts
Matt Kreps 214-597-8200 mkreps@darrowir.com
Michael Wetherington 214-284-1199 mwetherington@darrowir.com
investors@beneficient.com
Forward Looking Statements
Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding approval of the proposed settlement and outstanding GWG-related claims against entities related to the Company’s founder and CEO to whom the Company owes certain indemnification obligations. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are based on our management’s beliefs, as well as assumptions made by, and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected.
Important factors that could cause actual results to differ materially from those expressed in the forward-looking statements include, among others: the timing and the final outcome of the GWG Litigation; entry of a final judgment by the court in the GWG Litigation and the risks, uncertainties, and factors set forth under “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and its subsequently filed Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date they are made. The Company assumes no obligation to update forward-looking statements to reflect actual results, subsequent events, or circumstances or other changes affecting such statements except to the extent required by applicable law.
Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
FAQ
What is the financial impact of BENF's GWG litigation settlement on shareholders?
Does BENF's settlement agreement admit any wrongdoing in the GWG litigation?
What remaining legal risks does BENF face after the GWG litigation settlement?
Why did BENF decide to settle the GWG litigation in March 2025?
