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Prudential Insurance, Execs Cleared of Obstructing Justice

January 30, 1997|From Bloomberg News

Prudential Insurance Co. of America and its top officers didn't obstruct justice when the company destroyed documents sought by policyholders who are suing the firm, a judge ruled Wednesday.

Special Master Justin Walder, who investigated the matter on behalf of U.S. District Judge Alfred Wolin in Newark, N.J., ruled that several incidents of document destruction weren't the result of official policy.

Wolin earlier fined Prudential, which is owned by its policyholders, $1 million for destroying documents relevant to a massive class-action lawsuit. The suit alleges that the company wrongly persuaded holders to cash out existing policies in exchange for new ones.

Wolin is weighing the fairness of a proposed class-action settlement worth as much as $2 billion. On Wednesday, he held that the insurer's actions were nothing more than a lack of sensitivity.

"Because this court has no jurisdiction to sanction insensitivity, the court leaves that remediation to the court of public opinion," Wolin wrote.

Lawyers for the plaintiffs said that the investigation may have been too quick to determine whether Prudential encouraged destruction of evidence.

"There's more investigation that needs to be done, and it needs to be done by someone with a lot of time," said plaintiffs' attorney Sam Wilner. "It can't be rushed."

Prudential executives were not immediately available for comment.

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