Mark Walter and his companies have been sued in federal court over similar issues to what federal prosecutors are looking into: faulty life insurance disclosures and whether policyholder funds were improperly used to fund investments like the Dodgers and Lakers.

The lawsuit, filed Wednesday in Florida federal court, names Walter, Delaware Life Insurance Company, Group 1001, TWG Global, and Guggenheim Partners as defendants. It alleges the companies misrepresented the extent to which policyholder-backed investments were tied to Walter-related entities, and claims their concealment harmed annuity holders.

The complaint features nine counts, including fraudulent concealment, breach of contract, and aiding and abetting fraud. It doesn’t specify an amount it’s seeking in damages, but notes at least $5 million in damages is anticipated. The class is expected to include “tens of thousands” of annuity purchasers across the country.

The suit comes as Walter’s business empire is under parallel investigations by federal prosecutors in the Southern District of New York and the U.S. Securities and Exchange Commission, probes that were only revealed in June when a regulatory filing noted two of Walter’s companies had received grand jury subpoenas. A representative for the SEC has declined to comment, while representatives for the DOJ and SDNY have not responded to requests for comment.

Among the issues under investigation are that a June 2025 disclosure from Delaware Life incorrectly reported that about $1.4 billion, or roughly 3% of its invested assets, were “affiliated investments.” In June, after an internal review prompted by the federal subpoenas, the company restated its filings to show the figure was actually more than $17 billion, or about 40%.

“It took federal grand jury subpoenas and an internal investigation to force this concealment’s disclosure,” the lawsuit says.

The timeline is pertinent to the named plaintiff, Ira Rosner, a 67-year-old Florida resident who claims he put more than $1 million into a Delaware Life annuity in April after exchanging out of an existing policy he had with Jackson National. The policy he purchased with Delaware Life promised Rosner and his wife $181,677 in annual lifetime income beginning in 10 years, with the guarantees backed by Delaware Life’s financial strength and ability to pay claims.

However, once Rosner found out about the disclosure issues and investigations, he wanted out, because Delaware Life’s ability to make good on its promise suddenly seemed unclear. But a 30-day window under which he could return the annuity for a full refund had expired.

“Plaintiff was left in a Catch-22: remain in a contract whose central promise required him to trust the Defendants, who had belatedly revealed that they were under federal criminal investigation for misreporting the very assets backing that promise and who were continuing to conceal the full extent of it, or pay to get out.”

Since the investigations became public knowledge, Walter has been on a deal spree. In a shock move in August, he sold the Lakers at a $12.5 billion valuation, just a year after purchasing the team at a $10 billion valuation. This week, he agreed to sell his stake in Premier League soccer club Chelsea FC. And it was recently revealed in a regulatory filing that TWG Global will purchase up to $6.5 billion of Delaware Life’s investments tied to its affiliates, with the insurer receiving up to $6.5 billion of non-affiliated investments in exchange.

Last month, TWG Global—Walter’s investment holding company that owns assets including his sports teams—insisted there had been no fraud committed and rejected the idea that Walter’s Lakers exit was part of a “fire sale” to raise money amid the federal investigations. It also said there had been “no victim here” and declared that the Dodgers are not for sale.

The lawsuit notes that Walter’s Lakers sale happened right around the same time that he “offered to pledge his equity stake in Guggenheim as collateral to secure billions of dollars in short-term loans to his holding company, TWG, reportedly promising lenders double-digit yields.”

“Public reporting connected the proceeds and timing of the sale to Walter’s effort to raise cash to address insurer loans under federal scrutiny, although the precise disposition of the proceeds has not been publicly established,” the suit says. 

It also references the Dodgers, noting this isn’t the first time Walter has found himself in court over similar issues. It points to a 2014 proposed class action that alleged Walter improperly used policyholder funds to help pay for his Dodgers acquisition, and that the use of those funds had not been disclosed. That suit was voluntarily dropped the day after it was filed, although the forensic accountant whose work helped underpin the case previously told Front Office Sports the outcome was beneficial for the plaintiffs.

“Defendants thus knew, long before the Class Period, that concealing the affiliated character of insurer investments from regulators and policyholders was unlawful, and that policyholders had objected to it,” the new suit says.

Representatives for both sides did not immediately respond to requests for comment on Thursday.