SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of Report (Date of earliest event reported) June 6, 1994
(May 26, 1994)
TORCHMARK CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8052 63-0780404
(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification No.)
incorporation)
2001 Third Avenue South, Birmingham, Alabama 35233
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (205) 325-4200
None
(Former name or former address, if changed since last report)
Index of Exhibits page 3.
Total number of pages in this report is 4.
<PAGE>
Item: 5. Other Events
As previously reported in the Form 10-K for the fiscal year
ended December 31, 1993, litigation was filed in May 1992 against
Liberty National Life Insurance Company ("Liberty National") in the
Circuit Court for Barbour County, Alabama (Robertson v. Liberty
National, Case No.: CV-92-021). This suit was amended in October
1992 to include claims on behalf of a class of Liberty National
policyholders alleging fraud in the exchange of certain cancer
insurance policies. It seeks substantial equitable and injunctive
relief and unspecified compensatory and punitive damages. A
policyholder class was certified by the Barbour County Court in
March 1993. Additionally, subsequent to the class certification,
a number of individual lawsuits based on substantially the same
allegations as in Robertson were filed by plaintiffs in Alabama,
Georgia, Florida and Mississippi. Four additional class action
suits also based upon substantially the same allegations as in
Robertson were filed in Mobile County, Alabama (Adair v. Liberty
National, Case No.: 93-958 and Lamey v. Liberty National, Case No.:
CV 93-1256) and in Polk County, Florida (Howell v. Liberty
National, Case No.: GC-G 93-2023 and Scott v. Liberty National,
Case No.: GC-G 93-2415) after the class certification. Lamey and
Adair are presently stayed pending the outcome of Robertson, and
Howell and Scott are also the subject of temporary stay orders.
The individual post-class certification lawsuits have been stayed
as well.
On October 25, 1993, a jury in the Circuit Court for Mobile
County, Alabama rendered a one million dollar verdict ($1,000
actual damages) against Liberty National in McAllister v. Liberty
National, Case No.: CV-92-4085, one of twenty-five suits involving
cancer policy exchanges which were filed prior to class
certification in the Barbour County litigation. Liberty National
filed appropriate post-judgment motions and has appealed the
McAllister verdict. Previously, another judge in the Mobile County
Court had granted a summary judgment in favor of Liberty National
in another substantially similar suit in which no cancer claims had
been submitted (Boswell v. Liberty National, Case No.: CV-92-3342),
which was appealed to the Alabama Supreme Court. On May 13, 1994,
the Alabama Supreme Court reversed and remanded Boswell holding
that the plaintiffs had alleged injury or damages in the form of
the additional policy premiums paid which were sufficient to
withstand a motion to dismiss. Following this order and pending a
petition for rehearing, the Boswell case was settled. Including
the McAllister case, only four of the preclass certification
individual cancer exchange cases remain active at this time.
The Robertson litigation was tentatively settled pending a
fairness determination by the Court after a hearing was held on
January 20, 1994. Class members were mailed notice of the hearing
and the proposed settlement.
On February 4, 1994, the Circuit Court for Barbour County,
Alabama ruled that with a $16 million increase in the value of
equitable and monetary relief contained in the proposed Robertson
settlement from approximately $39 million to $55 million, the
settlement would be fair and would be approved, provided that the
parties to the litigation accepted the amended settlement within
fourteen days of the issuance of the ruling. On February 17, 1994,
the Court extended for two weeks the period for filing objections
to or accepting the court's order conditionally approving the class
action settlement. On February 22, 1994, the Court entered an
order in the Robertson litigation, which delayed any final decision
on the proposed class action settlement and various motions to
modify it (including motions to delete Torchmark from the
settlement release), pending certain specified discovery to be
completed within 90 days from the date the order was entered. In
the order, the Court directed limited additional discovery
regarding whether Torchmark had any active involvement in the
cancer policy exchanges. Pending completion of limited additional
discovery, the Court reserved jurisdiction and extended the
deadline for acceptance or rejection of the modifications set forth
in the February 4, 1994 order. On May 6, 1994, the Court entered
an order in the Robertson litigation setting a hearing on May 19,
1994 on all outstanding motions in that case. At the hearing,
intervenors were granted an additional week to file materials with
the Court. The Court indicated that a final ruling was likely to
be entered some time thereafter.
On May 26, 1994, the Barbour County Court entered an Order
and Final Judgment in the Robertson litigation, making final the
findings and conclusions of its February 4, 1994 Order. That Order
has been approved by the parties to the action. The discovery
regarding the propriety of Torchmark's release by the settlement
agreement was concluded prior to the entry of the Order and Final
Judgement and Torchmark was included in the release. Torchmark
believes that it is highly likely that intervenors will pursue an
appeal of the ruling to the Supreme Court of Alabama.
In connection with orders of the Barbour County Circuit Court,
Torchmark had provided for the $55 million proposed amended
settlement charge in its 1993 financial reports prior to final
approval of the settlement.
Item 7. Financial Statements and Exhibits.
No financial statements or exhibits are required to
be filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
TORCHMARK CORPORATION
Date: June 6, 1994 /s/ R. K. Richey
R. K. Richey
Chairman and Chief Executive Officer
