Lear Capital Lawsuit 2026: Settlements, Bankruptcy Payouts, and How to Claim
Quick Answer
- Lear Capital faced fraud lawsuits from New York and Los Angeles over hidden commissions up to 33%.
- The company settled for $8.75 million in regulatory actions and filed Chapter 11 bankruptcy.
- Investors who bought metals between Jan 1, 2016 and March 3, 2022 may receive bankruptcy distributions.
The Lear Capital lawsuit is a resolved regulatory enforcement action, not an ongoing consumer class action. New York Attorney General Letitia James sued Lear Capital and founder Kevin DeMeritt in June 2021, alleging the company defrauded nearly 1,000 New Yorkers out of approximately $10 million through hidden commissions .
If you bought precious metals from Lear Capital, you may be eligible for compensation through the company’s bankruptcy plan. The distribution applies to investors who purchased between January 1, 2016 and March 3, 2022, regardless of whether you filed a bankruptcy claim .
This article explains the verified settlements, the bankruptcy distribution process, who qualifies, and what steps affected investors can take. One detail most coverage misses: even investors who never filed a bankruptcy claim can still receive a pro rata distribution under the confirmed plan .
The Facts
| Case | Lear Capital regulatory lawsuits and Chapter 11 bankruptcy |
|---|---|
| Status | Settled and in bankruptcy distribution |
| Fund Size | $6M (NY), $2.75M (LA), $5.5M (bankruptcy) |
| Est. Per Person | Difference between actual fee and 12% hypothetical fee |
| Claim Deadline | Closed for bankruptcy proofs of claim |
| Administrator | Bankruptcy plan administrator (contact state regulators) |
| Proof Needed | Transaction records showing purchases between 2016-2022 |
Is the Lear Capital Lawsuit Legit or a Scam?
The Lear Capital lawsuit is legitimate. It was filed by the New York Attorney General and resolved through a court-approved settlement and bankruptcy plan. This is not a scam.
The scam risk is different: third parties may contact you claiming to process a Lear Capital payout for a fee. That is unnecessary. The bankruptcy distribution is handled through the plan, and you can verify your eligibility with your state securities regulator .
New York’s lawsuit alleged Lear charged undisclosed commissions up to 33% on more than $43 million in sales . The company’s founder, Kevin DeMeritt, was named personally in the action .
Los Angeles filed its own lawsuit in 2019, alleging similar deceptive practices. The city secured a $2.75 million settlement, with 90% going to restitution for eligible customers .
How Much Is the Lear Capital Lawsuit Worth?
Lear Capital lawsuit settlements total approximately $8.75 million in regulatory payments, plus a $5.5 million bankruptcy distribution fund. Your individual payout depends on the fees you were charged.
The bankruptcy plan calculates distributions as the difference between the actual fee charged and a hypothetical 12% fee . Here is how that works:
| Scenario | Actual Fee | Hypothetical 12% | Your Distribution |
|---|---|---|---|
| $10,000 purchase | 33% ($3,300) | 12% ($1,200) | $2,100 |
| $50,000 purchase | 25% ($12,500) | 12% ($6,000) | $6,500 |
| $100,000 purchase | 20% ($20,000) | 12% ($12,000) | $8,000 |
Not yet determined for any specific individual because distributions depend on your transaction records and the total claims pool. The $5.5 million is distributed pro rata among all eligible investors .
New York’s $6 million settlement is separate and goes to eligible New York customers harmed by Lear’s conduct . Los Angeles’s $2.75 million goes to eligible customers nationwide, with 90% directed to restitution .
Reality Check: No one will text you first offering Lear Capital settlement money. The bankruptcy distribution is automatic for eligible investors based on company records. You do not need to pay anyone to receive it. Verify your status through your state securities regulator, not through unsolicited contacts.
Who May Qualify for a Lear Capital Settlement?
You may qualify if you purchased retail precious metals from Lear Capital between January 1, 2016 and March 3, 2022. The bankruptcy plan covers investors nationwide, not just those in New York or Los Angeles.
The key eligibility factors include:
- Transaction date: Purchases between January 1, 2016 and March 3, 2022 .
- Product type: Retail precious metals, primarily coins and bullion .
- Fee charged: The distribution is calculated on the difference between your actual fee and a 12% hypothetical fee .
- Claim status: Investors who filed timely bankruptcy claims receive refunds first. Investors who did not file can still receive pro rata distributions .
Vermont’s regulator specifically noted that the distribution applies to “customers who entered a transaction with Lear between January 1, 2016, and March 3, 2022” . Colorado, Iowa, Mississippi, and Michigan issued similar notices .
How Do You File a Lear Capital Bankruptcy Claim?
The deadline to file a bankruptcy proof of claim has passed. However, the confirmed plan includes provisions for investors who did not file claims to still receive distributions.
Here is what affected investors can do:
- Contact your state securities regulator. They have records of the Lear Capital settlement and can confirm your eligibility .
- Gather your transaction records. Find purchase confirmations from Lear Capital between 2016 and 2022.
- Confirm whether Lear has your current address. The plan administrator uses company records to distribute funds.
- Watch for correspondence from the bankruptcy administrator. Legitimate notices come from the plan, not third parties.
- Do not pay anyone to file or process a claim. The distribution is automatic for eligible investors.
The bankruptcy plan was confirmed on June 12, 2023 . Distributions are handled by the plan administrator.
What Is the Lear Capital Lawsuit About?
The Lear Capital lawsuit is about hidden commissions and deceptive sales practices that targeted elderly investors. Regulators alleged Lear told customers it charged only a small transaction fee when it actually collected up to 33% of the purchase price .
The New York Attorney General’s June 2021 lawsuit alleged that Lear:
- Persuaded investors, including many elderly Western New York residents, to invest retirement savings in precious metals.
- Charged undisclosed commissions up to 33% on more than $43 million in sales.
- Operated without required registration as a commodity broker-dealer or telemarketer.
- Coached investors on answers and used invoices that made commission information hard to read .
Los Angeles’s lawsuit alleged similar conduct, including limiting customer communications to phone calls to eliminate paper trails of verbal misrepresentations .
The company entered Chapter 11 bankruptcy as litigation mounted. The bankruptcy plan resolved the state investigations and established the $5.5 million distribution fund .
Key Takeaway: Lear Capital’s regulatory settlements total $8.75 million plus a $5.5 million bankruptcy fund, all stemming from hidden commissions up to 33% charged to precious metals investors.
What Is Vincent Cheung v. Lear Capital Holdings?
Vincent Cheung v. Lear Capital Holdings, Inc. was a proposed class action filed in the Central District of California in October 2024. The case was voluntarily dismissed in December 2024 .
The docket shows the complaint was filed on October 2, 2024, in case number 2:24-cv-08490 . The parties filed a stipulation extending time to answer in November 2024.
On December 2, 2024, the plaintiff filed a voluntary dismissal under Federal Rule of Civil Procedure 41(a)(1). The court closed the case on December 3, 2024 .
This case did not result in any settlement or distribution. It is separate from the regulatory actions and the bankruptcy plan. Investors should not expect any recovery from this dismissed case.
What Happens Next for Lear Capital Investors?
The Lear Capital bankruptcy distribution is ongoing. The next stages involve plan administration and fund distribution to eligible investors.
June 12, 2023 (Completed): Bankruptcy court confirmed the Chapter 11 plan .
Ongoing: Plan administrator distributes the $5.5 million fund to eligible investors based on transaction records.
Ongoing: State regulators continue to assist affected investors with eligibility questions .
No set date: Any remaining funds after initial distributions are handled per the plan terms.
Investors who purchased metals between January 1, 2016 and March 3, 2022 should confirm their current address is on file with Lear Capital or the plan administrator.
Frequently Asked Questions
Is the Lear Capital lawsuit a class action settlement?
No. It is a regulatory enforcement action and bankruptcy settlement, not a class action.
How much will I get from Lear Capital?
Your distribution is the difference between the fee you were charged and a hypothetical 12% fee, distributed pro rata from the $5.5 million fund .
Do I qualify if I never filed a bankruptcy claim?
Yes. The plan includes pro rata distributions for investors who did not file claims but purchased between January 1, 2016 and March 3, 2022 .
What fees did Lear Capital charge?
Regulators alleged hidden commissions up to 33% of the purchase price .
Is Kevin DeMeritt personally liable?
DeMeritt was named in the New York lawsuit and subject to a personal consent order .
How do I check my Lear Capital claim status?
Contact your state securities regulator. They have records of the settlement and can confirm eligibility .
What happened to the Vincent Cheung class action?
It was voluntarily dismissed in December 2024. No settlement resulted .
What if I bought Lear Capital metals after March 2022?
The bankruptcy distribution applies to purchases between January 1, 2016 and March 3, 2022. Later purchases are not covered by this fund .
