A Korean-American woman, the wife of a wealthy East Coast businessman, has lost her legal battle with a major bank after losing tens of millions of dollars in assets.
The woman claimed that the bank recommended unsuitable investments for her husband despite his suffering from cognitive decline and that the losses were caused by the bank’s failure to comply with its duty of care in managing his assets.
The U.S. District Court for the District of Massachusetts ruled on October 4 that the plaintiffs, Yoon Doelger, 77, and her husband, Peter Doelger, 87, had failed to prove a breach of duty by JPMorgan.
James Serritella, the attorney representing Doelger, said he “intends to appeal” the decision.
The lawsuit was filed in June 2021. According to the complaint, Yoon’s husband, Peter, had a successful career as an insulation entrepreneur and investor in Boston. In 2015, the couple sought investment advice from JPMorgan to fund their retirement.
The bank recommended that the couple invest in a master limited partnership (MLP), a type of limited partnership designed to provide tax breaks if certain requirements are met. From that point on, JPMorgan formally assumed responsibility for the couple’s wealth management and investments. The Doelgers invested $37 million in MLPs based on JPMorgan’s investment advice.
“Since 2014, Mr. Doelger had begun suffering from cognitive decline and required assistance in making financial decisions,” the complaint alleged.
According to the plaintiffs, Yoon consistently informed JPMorgan that her husband often forgot information due to his memory loss and often needed to be re-explained, adding that it resulted in the bank calling Yoon more often, indicating that the bank was fully aware of his condition.
During this process, Peter also allegedly signed a document with the bank called a “Big Boy Letter,” which formalizes the agreement between the parties. This is a document that formalizes an agreement between the parties, in which each side agrees that the other will not sue the other for non-public information.
In the complaint, the plaintiffs alleged that JPMorgan should have advised them to invest no larger than 5% of their net worth but failed to do so, and instead encouraged them to continue to increase the size of their investments to further fund their investments despite they had been incurring significant losses for years.
“As the portfolio continued to lose money, the bank failed to fulfill its fiduciary duties even though it was aware of Mr. Doelger’s cognitive decline,” the plaintiffs claimed, ”ultimately leaving them with only $1.5 million of their massive investment.”
During the trial, Yoon’s attorney presented evidence including medical documentation of her husband’s cognitive decline, evidence of the bank’s violation of its internal advisory rules, and evidence that the investment advisor was aware of his condition.
However, the court was not convinced despite the evidence.
“This case turns on whether the defendant knew that the plaintiff was suffering from cognitive decline to the extent that he was unable to make his own decisions about his finances,” said Judge Angel Kelly.
“Unfortunately, Mrs. Doelger’s testimony alone is insufficient to establish that the bank failed in its duty to protect its customers,” the judge ruled.
JPMorgan is now seeking attorneys’ fees from the Doelgers for the cost of the legal battles after the win.
Yoon Doelger is an art historian who came to the U.S. when she was in her 20s. Her husband, Peter sold his insulation business to Honeywell in 1995. He has since made his fortune in biotechnology and real estate investments in South Korea.
BY YEOL JANG, HOONSIK WOO [woo.hoonsik@koreadaily.com]
