Will Attorneys Try to Beat Asset Protection? Revisiting The Goldenberg Case   Marc Singer, CFP & Scott Wells, CFP Recently, a rumor circulated concerning plaintiff attorneys' goal to target physicians by developing a war chest of funds to fight a legal case to penetrate protected assets. In fact, this rumor has been around for almost 15 years. However, it is worth reviewing one of the most precedent-setting medical malpractice cases, to alleviate fears that the trial bar may come knocking. It is known as the Goldenberg case.    In 1993, Dr. Alan Goldenberg, a Broward County general surgeon, transected the common bile duct of a patient. As a result of this surgical complication, a malpractice suit was eventually filed. After 5 years of litigation, the patient won a $4,000,629 judgment against Dr. Goldenberg who had been bare at the time. The plaintiff attorneys refused to settle the case, even though they knew that Dr. Goldenberg's assets were well protected, and that there was no insurance coverage. This became the proverbial test case. The plaintiff attorney made it clear that he was going to pursue the doctor to send a message to other physicians in South Florida, that they needed to carry insurance "or else". We have actually seen this threat made several times against our own clients. At the time the judgment was rendered against Dr. Goldenberg, he had the following assets: House - $845,000, IRA - $2,546,319, Annuities - $355,894, Wage Account-$4,460. The total assets in his name equaled $3,791,000. The attorneys tried to penetrate what are normally viewed to be protected assets under Florida law. They seemed unable to find any challenges for the Homestead, IRA, or the Wage Account. Thus, they focused on the annuities that they argued were not protected because of a small technicality in deferred vs. immediate annuities. The attorneys felt there might be a chink in the armor of annuities to be exploited. Over the next 3 years, this case was taken through the appeals courts. In May of 2001, the Florida Supreme Court ruled that virtually all annuities are absolutely protected under Florida law, and are not available to satisfy a judgment.  The doctor eliminated a $4 million judgment, and retained virtually all his assets. Since the plaintiff refused to settle, Dr. Goldenberg ended up declaring voluntary bankruptcy. The final resolution of the case involved Dr. Goldenberg paying the plaintiffs approximately $40,000 and discharging the $4 million judgment. He still kept $3.7 million of protected assets. In other words, the day after his bankruptcy, the slate was completely wiped clean. An important fact that is not normally mentioned is that Dr. Goldenberg did not ever have to pay the $250,000 financial responsibility amount, and never lost his license. When the courts discharged his liability, he no longer owed anyone the $250,000. The logic is that the Board of Medicine should not revoke a doctor's license for not paying a judgment that they no longer owe. While this is not a guarantee, there have been numerous cases where doctors have retained their licenses. Recently, I had the privilege of discussing this case with Dr. Goldenberg himself. I would suggest a debt of gratitude on behalf of all Florida physicians who may benefit as a result of the significance of this test case.  Note: Dr. Goldenberg is not a client of Singer Xenos. All the information in this newsletter is a result of public information and therefore, not considered confidential. Singer Xenos does not provide legal advice. Please consult with your own legal counsel.