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Heather Latino is a supervising attorney in the Consumer Law Unit of the Legal Aid Society of the District of Columbia. Thomas Papson is a volunteer staff attorney in the unit.

The Post recently revealed, using lead-poisoning cases in Baltimore as an example, that unsophisticated people with structured settlements are being victimized by companies seeking to purchase their future payments for far too little and without regard for the protective purpose of the structured settlement.

These settlements are designed to afford their beneficiaries a steady stream of income over a long period of time for a reason. That is why federal law requires the purchaser to obtain an order from a state court judge finding that the transfer of rights to future payments for immediate cash would be in the “best interest” of the seller. To implement that law, 48 states have adopted structured settlement protection acts.

But not the District, which has no law on this subject. As a result, when a company proposing to purchase structured settlement payments from a District resident seeks approval from a D.C. Superior Court judge, the court must apply the law of the state where the insurance company responsible for the future payments is located. (The future payments are made through an annuity purchased by the defendant in the underlying personal injury case.) Although the state laws are built on the same model, they vary significantly in how well they protect the interests of the sellers. The Maryland law that applies to Baltimore’s lead-poisoning victims has weaknesses that could be addressed with stronger legislation. For example, some state laws require more complete disclosures to the reviewing judge, including information about the underlying personal injury settlement and whether there have been prior transfers of payment rights. State laws also differ in the way they address the requirement for “independent professional advice.” New York’s law requires the judge to make a specific finding that the financial terms of the deal are “fair and reasonable” to the seller.

Fortunately, D.C. Council members Mary M. Cheh (D-Ward 3), Charles Allen (D-Ward 6), Anita Bonds (D-At Large), David Grosso (I-At Large) and Brandon T. Todd (D-Ward 4) introduced a structured settlement protection bill that would put the District in the forefront of jurisdictions with strong laws. The proposed legislation also would put to rest a minority view among D.C. Superior Court judges that their court does not have jurisdiction over these cases because the District has not adopted legislation implementing the federal law. As things now stand, D.C. residents sometimes find their cases being filed in some far-off jurisdiction that happens to be the place where the annuity insurer is located and where they cannot attend the hearing in person.

At the Legal Aid Society of the District of Columbia, our attorneys regularly counsel low-income D.C. residents seeking to sell their rights to future structured settlement payments. We try to help our clients understand that these sales always come at a high cost and should be considered only as a last resort when there are truly no other alternatives. When appropriate, we also assist our clients in getting substantially better deals from the purchaser or restructuring the deals to retain more of the protective features of the original structured settlement. The proposed D.C. legislation would be a huge step toward ensuring that District residents with structured settlements from personal injury cases are not victimized a second time by a company seeking to purchase their settlement payments for too little money and too little regard for their best interests.