Lincoln Financial wins latest round in variable annuities methodology patent case

A federal court affirmed a ruling for Philadelphia-based Lincoln Financial Group in a case of patent infringement against Transamerica Life Insurance Co. and two other AEGON USA companies over the computerized method of administering certain variable annuities.

The judge said a jury’s verdict for Philadelphia-based Lincoln Financial and awarding of $13.1 million in damages was appropriate. The judge also prohibited Transamerica and other AEGON USA subsidiaries from using a computer to administer new or existing riders using the patented approach.

In February, a jury ruled in favor of Lincoln National Life Insurance Co. and against three Aegon USA companies: Transamerica Life Insurance Co., Transamerica Financial Life Insurance Co., and Western Reserve Life Assurance Co. of Ohio. That case is now on appeal to the Federal Circuit Court of Appeals.

Transamerica had asked that the prohibition on use of the computer application be delayed pending the appeals court ruling, but the judge denied that request. That ruling also is on appeal.

“We are pleased that the federal district judge in Iowa validated the jury’s verdict, confirming the validity of our ‘201 patent,” said Rob Grubka, head of product and retirement solutions for Lincoln Financial, in a statement. “We are dedicated to providing innovative insurance and retirement solutions that help customers secure their financial futures. We regard our patents and product solutions as valuable assets and we intend to vigorously protect our intellectual property against infringement.”

Lincoln Financial filed its first patent for administering income guarantees in 1998.

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