On July 7, 2004, Mehri & Skalet, along with co-counsel, initiated a ground-breaking class action lawsuit against John Hancock Life Insurance for its company-wide policy of rarely selling life insurance to African-Americans in the early to mid-20th century. The lawsuit also confronts John Hancock’s practice of offering African-Americans substandard and seriously inferior life insurance products when it did sell insurance to African-Americans. The policies offered African-Americans are known as industrial or monthly debit policies and had little value.
The named Plaintiff was an African-American woman whose mother had purchased life insurance policies from John Hancock in the 1940s and 1950s. The lawsuit also alleged that John Hancock fraudulently concealed its practices from policy holders and from the public and that the plaintiff and the class were only recently able to discover the discrimination even though it occurred long in the past.
On August 21, 2009, the U.S. District Court for the District of Connecticut granted final approval of a $24.4 million race discrimination class action settlement with John Hancock Life Insurance Company, resolving claims of decades-old discriminatory practices in the sale and marketing of life insurance policies to African-Americans. It is an extraordinary settlement that makes fair amends for historic practices providing relief to those who were sold these products and giving a substantial amount of money back to the African-American community.
Class members, defined as all African-Americans who were purchasers, owners, insureds, or beneficiaries of industrial or monthly debit policies issued by John Hancock prior to 1959, are entitled to up to $1,200 per policy if they submit valid claims as determined by the Special Master, retired U.S. District Court Judge U.W. Clemon.
The settlement also has large cy pres component. Over $15 million of the settlement will be used to create the “Norflet Progress Fund”, named in honor of Ms. Merle Norflet, the lead plaintiff in the lawsuit, which will be distributed to organizations that benefit African-American communities.
Noted civil rights attorney John Brittain heads the committee that advises counsel and the court on cy pres distribution. The committee is comprised of leading civil rights attorney Theodore Shaw, Judge Nathaniel Jones, Geraldine Sumter, Charles Ogletree, and John Powell, and community advocate Deidra Ierardi.
The Committee has invited organizations to submit a letter of inquiry indicating the population served by the organization and the type of grant sought. After reviewing letters of inquiry, the Committee will invite organizations to submit full grant proposals and applications. The Committee and Class Counsel hope to award grants in late 2011.