The surge in excessive jury awards and the increasing eagerness of litigious attorneys to pursue questionable cases with lucrative contingent fee agreements have led to a proliferation of unpredictable lawsuits within our civil justice system.
The high expense of defending against even meritless lawsuits, averaging around $94,000 before a trial commences, accentuates the inclination towards plaintiK litigation. In many cases, defendants opt to “settle” with plaintiKs instead of facing the emotional strain and financial jeopardy of a prolonged legal tussle. These settlements often amount to little more than legalized extortion.
Adding to the problem is the emergence of a new wave of legal challenges stemming from workplace incidents. Both current and former employees are capitalizing on the opportunity to sue employers for wrongful termination, discrimination, sexual harassment, and similar issues as a form of lucrative “employee benefit.” While certain claims certainly warrant attention, a significant portion of these claims lack genuine merit. Let us call them what they are, fraud and a legal shakedown.
Given these circumstances, what should a business or professional individual do?
The solution: Establish an Asset Protection Plan now, before legal proceedings commence and it is too late.
What is the primary goal of Asset Protection? Simply put, deterrence.
Your asset protection strategy can:
• Deter litigation by minimizing the economic incentive to sue
• Insulate business and family assets from risks and liabilities, without relinquishing asset control
• Install a workplace policy for resolving disputes and claims through arbitration and outside of the court system
• Put your assets out of reach legally, if it becomes necessary
The key lies in strategic planning and design. Well-founded and reliable strategies initiate with what we refer to as the Asset Management Limited Partnership (AMLP). This mechanism establishes an initial legal barrier between you, your assets, and whoever is trying to take if away from you, safeguarding your assets from potential threats. It focuses on holding “Safe Assets,” comprising stocks, bonds, mutual funds, notes receivable, and other liquid investments.
The AMLP can also possess membership interests in Limited Liability Companies (LLCs) responsible for managing “Risky Assets” like investment real estate, boats, airplanes, and more. By isolating risky assets within an LLC, the AMLP can indirectly safeguard these assets. Notably, LLC members, akin to corporate shareholders, generally bear no personal liability for the LLC’s actions.
Once this initial foundational domestic structure is established, a powerful tool emerges – the Bridge Trust®. Often, the mere presence of this robust, powerful, and custom-designed Trust can deter potential litigants effectively. This specialized Trust enables clients to place assets beyond the jurisdiction of U.S. Courts, enhancing deterrence and shielding against lawsuits.
Asset protection planning must be undertaken proactively, well before the specter of litigation looms, for it to be effective. Postponing this process until after a lawsuit materializes can severely limit your planning options. It may make it difficult to do any planning at all. Additionally, it is imperative that your Asset Protection Plan always remains tax-neutral. Be wary of schemes that boast substantial tax advantages and prioritize schemes focused solely on protecting assets from unforeseen creditors rather than tax evasion. Run, do not walk, away from any questionable scheme that promises huge tax benefits. Legitimate asset protection seeks to protect property and assets from future unknown creditors and not to evade income taxes.
Asset protection is a nuanced legal field that necessitates the expertise of a seasoned law firm capable of crafting and defending a robust plan. When executed adeptly, asset protection can provide security and tranquility now, serving as a formidable defense when safeguarding the fruits of your labor.
Assuming responsibility for your financial, estate, and asset protection planning is paramount for peace of mind. Allow us to guide you in achieving that peace of mind.
Call to schedule a legal consultation with an asset protection lawyer at (888) 773) – 9399
By: Brian T. Bradley, Esq.
