Gilman and Pastor, LLP represents corporations, private universities and government agencies in a wide range of complex commercial litigation, and has done so for nearly 30 years.

• Antitrust and Trade Regulation


• Construction Litigation


• Corporate and Business Litigation


• Employment Litigation


• Franchise and Distribution


• Insurance Litigation


• Products Liability Litigation


• Securities Litigation

Representative clients have included American Airlines, Duke University, Federated Stores, Inc., Hershey Foods Corporation, Kroger Companies, Napa, Safeway, Inc., The United States Government, The United States Postal Service and University of Miami.

For more information, contact us.

I.R.S. Section 412(i) Litigation
Gilman and Pastor is representing business and entities who have been audited by the Internal Revenue Service for pension and retirement funds. The firm has put together a top team of professionals to defend such litigation and audits.

Life Insurance Companies and their Agents have been selling abusive life insurance and annuity products. Many pension plans have been promoted as legitimate retirement plans which contain various life insurance products and annuities. Unfortunately the Internal Revenue Service (“IRS”) has now attacked many of these pension and retirement plans and is conducting audits to demand payment for taxes, penalties and interest and attempting to disqualify many plans.

If you are an accountant, business owner, corporate officer, dentist, doctor, professional athlete, professional or corporation of high net worth, you were unscrupulously targeted by life insurance companies and their agents to purchase a 412i defined benefit pension plan. You were chosen to purchase a 412i plan because you have the net worth to pay for it.

Our investigation has disclosed that many life insurance companies, promoters, attorneys, and accountants promoted and sold these plans, including but not limited to the following:

• American General Life Insurance Company


• Guardian Life Insurance Company


• Hartford Life and Annuity Insurance Company


• Indianapolis Life Insurance Company


• Pacific Life Insurance Company


• Pension Services, LLC


• Many Other Life Insurance Companies and Agents

The individuals and groups above devised a scheme to sell abusive tax shelters under the auspices of Section 412(i) of the tax code. A 412(i) is a defined benefit pension plan. It provides specific retirement benefits to participants once they reach retirement and must contain assets sufficient to pay those benefits. A 412(i) plan differs from other defined benefit pension plans in that it must be funded exclusively by the purchase of individual life insurance products.

To create a 412(i) plan, there must be a trust to hold the assets. The employer funds the plan by making cash contributions to the trust, and the Code allows the employer to take a tax deduction in the amount of the contributions, i.e. the entire amount.

The trust uses the contributed funds to purchase some combination of life insurance products (insurance or annuities) for the plan. As the plan participants retire, the trust will usually sell the policies for their present cash value and purchase annuities with the proceeds. The revenue stream from the annuities pays the specified retirement benefit to plan participants.

These defendants (with the aid and knowledge of the insurance companies) used the traditional structure and sold life insurance policies with excessively high premiums. The trust then uses the large cash contributions to pay high insurance premiums and the employer takes a deduction for the sum of those large contributions. As you might expect, these policies were designed with excessively high fees or “loads” which provided exorbitant commissions to the insurance companies and the agents who sold the products.

The policies that were sold were termed Springing Cash Value Policies. They had little or no cash value for the first 5-7 years, after which they had significant cash value. Under this scheme, after 5-7 years, and just before the cash value sprung, the participant typically purchases the policy from the trust for the policy’s surrender value. In theory, you have a tax free transaction.

The IRS does not recognize the tax benefit of such a plan and has repeatedly issued announcements indicating that such plans are contrary to federal tax laws and regulations.

Have you received a letter from the IRS either (1) informing you of an upcoming audit of your plan or (2) demanding payment for substantial tax "penalties and interest"? The "tax free" benefit pension plan you purchased might be a scam, a fraud. Please allow us to speak with you and review your documentation to help you to determine your best course of action. Your communications will be treated with the strictest attorney-client confidence.

If you were a victim of such a sale of a 412i or 419 plan, we encourage you to contact us immediately for legal assistance. You may also receive a free initial consultation by telephone at 877-428-7374. If you desire a free initial phone consultation please leave a specific time or time period within which to contact you.

Since you have already expanded a substantial amount of money in your pension plan and believed it was a legitimate retirement plan, you are obviously shocked to now learn that major life insurance companies and their agents may have sold you improper retirement plans simply to generate enormous commissions on life insurance and annuities.

DRAM Anti Trust
Gilman and Pastor, LLP has been appointed by the Trial Court in the consolidated Massachusetts Indirect Purchaser Actions. The firm was also appointed by the District Court to the Indirect Purchaser Plaintiffs' Executive Committee in In re Dynamic Random Access Memory (DRAM) Antitrust Litigation, No. M 02-1486 (N.D. Cal.) and is currently litigating the case on behalf of indirect purchasers nationwide.

Pension Benefit Victims
Most employees are not aware that their employers may not have contributed sufficient assets to pay promised benefits to future retirees or that the assets in their retirement plans may have substantially decreased in value creating a phenomenon known as under funding. This under funding could result in the inability of your pension plan to pay the retirement benefits due you.