Retiree: ‘A lot of good people have been unduly hurt’

Robert Dawson worked for the company now called LandAmerica Financial Group Inc. for 35 years. He was chief executive of Lawyers Title Insurance Corp., a subsidiary, for 17 years until his retirement in 1989.

"There's no reason this company should be where it is," a visibly upset Dawson said at a meeting of about 35 area retirees of the company. "A lot of good people have been unduly hurt."

Like 2,000 people nationwide, Dawson lost his health-care and life-insurance benefits when LandAmerica's board of directors voted Nov. 24 to cancel them immediately. The Henrico County-based company began to notify people Nov. 26, the day the firm and a subsidiary filed for bankruptcy protection.

Now, retirees 65 and older must find supplementary policies to cover what Medicare does not, and younger people must find new insurance providers.

"I think it's been very poorly handled," Dawson said. "It's a terrible thing."

He blamed the title insurer's bankruptcy on bad management and foolish investments, not the sluggish housing market or credit crunch.

"It looks like they kind of lost sight of the fact that they had a very strong fiduciary duty," he said.

Dawson was talking about the subsidiary, LandAmerica 1031 Exchange Services Inc., which also filed for bankruptcy.

The exchange company held money for people who sold property and wanted to invest in similar property but did not have one in mind. It is a short-term way to defer tax payments.

Also during the meeting at the Gayton Branch Library in Henrico, retiree Barbara Thornton said a federal agency is reviewing LandAmerica's cancellation of benefits.

Thornton said the review follows her complaint to the Department of Labor's employee benefits security administration.

LandAmerica spokeswoman Lloyd Osgood said the company was not aware of any Labor Department review.

Gloria Della, director of public affairs for the Labor Department, would neither confirm nor deny a review or investigation.

But in a Dec. 11 letter to a LandAmerica retiree, acting supervisor Adam Black with the agency said its job was to enforce and administer regulations under the Employee Retirement Income Security Act of 1974.

Black wrote that he would keep Thornton updated on the review process.

Retirees who paid December insurance premiums by automatic deduction from pension checks will get refunds. People who paid by check will have to file a petition in U.S. Bankruptcy Court in Richmond, Osgood said.
Contact Emily C. Dooley at (804) 649-6016 or .