On February 5, we told you about the complicated case of Patricia Cornwell (the best-selling author of the Kay Scarpetta crime series of novels) suing her former financial advisers and one of its executives for revenues lost in the sum of more than $40 million. Her lawsuit – filed in federal court in 2009 – alleged that the defendants had cost her and her company millions in investment losses and unaccounted for revenue during their 4+ years business relationship, primarily because it moved Cornwell’s assets from a conservative investing strategy to a more aggressive one, without her permission.
This week, a jury ruled that the firm (Anchin, Block & Anchin) and one of its executives (Evan Snapper) had been negligent handling Cornwell’s money and awarded her $50.9 million. The defendants, not surprisingly, are reviewing their legal options, including possibly appealing the decision. But the amount awarded Cornwell may actually become much greater.
Part of the initial lawsuit included charges that the Anchin investment firm violated consumer protection laws. That part of the case now moves forward before a judge and, if he rules against the defendants, he is allowed to triple the damages awarded to Patricia Cornwell.
In addition to this being a high profile and huge award case, it may have much more far-reaching ramifications. According to Business Insider, this decision in a federal court – which holds financial advisers responsible for losses that occur during recessions – will make it more difficult for such firms to blame bad financial advice and mismanagement on financial conditions over which they have no control. (If you’ll recall, the defendants first denied there was any money missing but covered all bases by saying – if there was money missing from Cornwell’s accounts – it was because of the financial and housing crises, as well as her extravagant lifestyle).
In an interview with The Boston Globe after the verdict, Cornwell admitted that she knew it might be difficult for a jury to have sympathy for a wealthy woman who leads an extravagant lifestyle but had faith because she knew she was telling the truth.
Cornwell also indicated in the article that she would consider donating some of her award, possibly to conduct mental health research. (As noted in our prior article, Cornwell acknowledged in her lawsuit that she’s bipolar). If she does that, it would be not only a win for her but a win for many others as well. Case closed.
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