PHILADELPHIA – A litigation funder who had previously been denied its move to compel arbitration with an ex-pro football player set to receive proceeds from the NFL’s Concussion Litigation is now taking another kick at that field goal.
Thrivest Specialty Funding, LLC of Ardmore filed a petition to compel arbitration in the U.S. District Court for the Eastern District of Pennsylvania on Nov. 2 versus Toby L. Wright of Phoenix.
In October 2016, Wright, a former player in both the NFL and the XFL who suffers from post-concussion syndrome, had received – from another funder besides Thrivest – two advances against his expected $1.9 million recovery from the NFL Concussion Litigation, with the second advance leveraged at 150 percent annual interest.
In seeking relief, Wright approached Thrivest, who offered him a far lower annual interest rate of 19 percent.
“Thrivest purchased Wright’s agreement with the other funder, forgave almost $95,000 of Wright’s current obligation, and refinanced Wright into a new 19 percent agreement that provided Wright with an additional $27,602.54 in cash to help with his financial needs. Two years later, Wright informed Thrivest that he had been approved for a monetary award in the NFL Concussion class action,” the petition states.
“However, instead of honoring his promise to transfer the TSF Distribution to Thrivest, Wright demanded that Thrivest waive its rights under the agreement in exchange for a return of principal only. Thrivest refused Wright’s ultimatum and asked him to honor the agreement. Wright declined, placing him in breach. Thrivest then pointed to the agreement’s arbitration clause and demanded that Wright arbitrate the dispute. Wright refused to arbitrate, prompting this action.”
Wright argues the entire agreement is invalid, but does not dispute entering into the agreement or challenge its arbitration clause, Thrivest says.
The petitioner adds that 2 years ago, it enlisted the expertise of Wright’s primary physician and others to both ascertain his diagnosis and determine whether he was of “sound mind” and “sufficient mental capacity” to understand and sign legal documents.
The doctors agreed Wright possessed the mental faculties necessary to enter into the agreement, according to Thrivest – which Wright did on Oct. 5, 2016, and also provided Thrivest with “limited irrevocable power of attorney” to deposit Wright’s checks from the NFL settlement.
“But, in October 2018 after the claims administrator approved Wright’s award, Wright told Thrivest that he would not honor his promise to transfer the settlement payments] to Thrivest; Instead, Wright gave Thrivest an ultimatum – either waive its rights under the Agreement by Oct. 27, 2018 and recover only principal, or receive no repayment whatsoever,” the petition reads.
Wright cited a Dec. 8, 2017 order in the NFL Concussion Litigation which opined that “class members are prohibited from assigning or attempting to assign any monetary claims, and any such purported assignment is void, invalid and of no force and effect.”
“Thrivest was not a party to the NFL Concussion class action or the settlement agreement resolving that dispute, and neither Thrivest nor Wright are referenced in the Court’s Explanation and Order, which is currently the subject of numerous pending appeals before the United States Court of Appeals for the Third Circuit. Thrivest asked Wright to arbitrate their dispute over whether the agreement is valid and, if so, whether Wright breached, but White refused,” according to the petitioner.
The agreement entered into by Thrivest and Wright contained an arbitration clause, which said any dispute with regards to breach, interpretation or enforceability would be “exclusively resolved by binding arbitration.”
“There can be no dispute that Wright’s challenge to the validity of the agreement and Thrivest’s claim for breach fall squarely within the arbitration agreement and thus this Court must compel Wright to arbitrate that dispute,” Thrivest argues.
Thrivest requests that the Court enter an order in the form proposed directing Wright to arbitrate the parties’ dispute in arbitration before the American Arbitration Association, awarding Thrivest its costs and fees incurred in bringing this action, and awarding any further relief that the Court deems appropriate.
Thrivest is represented by Eric E. Reed, Peter C. Buckley and Mark J. Fanelli of Fox Rothschild, in Philadelphia.
The respondent, Wright, has not yet secured legal counsel, per Court records.
U.S. District Court for the Eastern District of Pennsylvania case 2:18-cv-04764
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at email@example.com