Springfield insurance firm argues against liquidation

Tuesday, April 6, 2010 at 4:11pm

A group accused by the state Department of Commerce and Insurance of conducting an unauthorized insurance business said it is the victim and shouldn’t have its assets liquidated.

Attorney Nader Baydoun told a Davidson County chancellor Tuesday his clients Smart Data Solutions, its owner Bart S. Posey Sr. and others named in a petition filed last month are willing to step aside and allow a third party to administer insurance claims from policies bought through SDS as benefits to its member clients.

Baydoun said respondents SDS and American Trade Association, also owned by Posey, merely sold access to insurance benefits that were to be administered by another respondent, Serve America Assurance, which failed to properly pay out claims by policyholders.

Commerce and Insurance Commissioner Leslie A. Newman in her petition claims none of the companies were authorized to operate in Tennessee as an insurer, and they should enter receivership to liquidate their assets and pay out on claims.

Baydoun said liquidation wasn’t necessary as a third-party firm from Texas, which he couldn’t immediately name, was ready to step in and administer the unpaid claims. But Chancellor Ellen Hobbs Lyle said the only difference in liquidating and not is that the companies would cease to exist afterward.

Also named in the petition are Posey’s wife, Angie Posey, director of ATA; Obed Kirkpatrick Sr., president of ATA; Linda Kirkpatrick, ATA secretary; Richard H. Bachman, vice president of ATA; Kristy Wright of ATA; William M. Worthy II, former ATA president; and Colin Youell, purported president or director of SAA.

The Kirkpatricks and Wright were dismissed from the petition at a hearing on Tuesday, during which Lyle said she expects to issue an order next week.

2 Comments on this post:

By: debi42k on 4/6/10 at 8:53

It sounds like these guys might get away with it because of their play on the english language. That truly would be criminal. It would be like slapping their hands with a stick of gum & telling them to promise to never do this again. I will be so disappointed in our entire judicial system if this happens.

As previous licensees, they know exactly what they have been doing & not doing. They are fully aware of how they appear to be representing themselves and their companies to the general public. Even if they are not actually selling insurance, they come across to the public as selling insurance, which is misleading. The paperwork I received from them Clearly stated that I had received a group benefit policy issued to the ATA. I had to send them proof of credible coverage from my previous carrier (Aetna) with whom I had been covered since 2007. Now that I am not covered by ATA, SDS or anyone else, I will not have coverage for any pre-existing conditions. I know i am not going to be alone in this either. This is just another injustice that has been done to us by these companies. Something needs to mandate that every insured, spouse & child has a letter of credible coverage written so they can obtain other health insurance without penalty.

I am following this very closely to determine if any class action lawsuits should be filed against either the companies or the individuals or both. Thank you!

By: skyduck on 4/7/10 at 3:53

It only took the DOI a year to catch on after several other states issued Cease and Desist orders....TOO MANY LAWYERS! THey cannot get business done in a timely fashion