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AMERCO AND CONSOLIDATED ENTITIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
(c) Includes $119,038 of lease payments under synthetic leases, which were prepaid in full and terminated in
April 2004. See Note 23 to the Consolidated Financial Statements.
Note 17: Contingencies
Kocher
On July 20, 2000, Charles Kocher (Kocher) Ñled suit in Wetzel County, West Virginia, Civil Action
No. 00-C-51-K, entitled Charles Kocher v. Oxford Life Insurance Co. (Oxford) seeking compensatory and
punitive damages for breach of contract, bad faith and unfair claims settlement practices arising from an
alleged failure of Oxford to properly and timely pay a claim under a disability and dismemberment policy. On
March 22, 2002, the jury returned a verdict of $5 million in compensatory damages and $34 million in punitive
damages. On November 5, 2002, the trial court entered an Order (Order) aÇrming the $39 million jury
verdict and denying Oxford's motion for New Trial Or, in The Alternative, Remittitur. Oxford has perfected
its appeal to the West Virginia Supreme Court. On January 27, 2004, the matter was argued before the West
Virginia Supreme Court and taken under advisement. Management does not believe that the Order is
sustainable and expects the Order to be overturned by the West Virginia Supreme Court, in part because the
jury award has no reasonable nexus to the actual harm suÅered by Kocher. The Company has accrued
$725,000, which represents management's best estimate of the costs associated with legal fees to appeal and
re-try the case. The Company has notiÑed its E & O carrier, who is disputing coverage, in the event of an
unfavorable outcome.
Shoen
On September 24, 2002, Paul F. Shoen Ñled a derivative action in the Second Judicial District Court of
the State of Nevada, Washoe County, captioned Paul F. Shoen vs. SAC Holding Corporation et al.,
CV02-05602, seeking damages and equitable relief on behalf of AMERCO from SAC Holdings and certain
current and former members of the AMERCO Board of Directors, including Edward J. Shoen, Mark V.
Shoen and James P. Shoen as defendants. AMERCO is named a nominal defendant for purposes of the
derivative action. The complaint alleges breach of Ñduciary duty, self-dealing, usurpation of corporate
opportunities, wrongful interference with prospective economic advantage and unjust enrichment and seeks
the unwinding of sales of self-storage properties by subsidiaries of AMERCO to SAC Holdings over the last
several years. The complaint seeks a declaration that such transfers are void as well as unspeciÑed damages.
On October 28, 2002, AMERCO, the Shoen directors, the non-Shoen directors and SAC Holdings Ñled
Motions to Dismiss the complaint. In addition, on October 28, 2002, Ron Belec Ñled a derivative action in the
Second Judicial District Court of the State of Nevada, Washoe County, captioned Ron Belec vs. William E.
Carty, et al., CV 02-06331 and on January 16, 2003, M.S. Management Company, Inc. Ñled a derivative
action in the Second Judicial District Court of the State of Nevada, Washoe County, captioned M.S.
Management Company, Inc. vs. William E. Carty, et al., CV 03-00386. Two additional derivative suits were
also Ñled against these parties. These additional suits are substantially similar to the Paul F. Shoen derivative
action. The Ñve suits assert virtually identical claims. In fact, three of the Ñve plaintiÅs are parties who are
working closely together and chose to Ñle the same claims multiple times. The court consolidated all Ñve
complaints before dismissing them on May 28, 2003. PlaintiÅs have Ñled a notice of appeal. These lawsuits
falsely alleged that the AMERCO Board lacked independence. In reaching its decision to dismiss these
claims, the court determined that the AMERCO Board of Directors had the requisite level of independence
required in order to have these claims resolved by the Board.
Article Four Trust
AMERCO is a defendant in four putative class action lawsuits. Article Four Trust v. AMERCO, et al.,
District of Nevada, United States District Court, Case No. CV-N-03-0050-DWH-VPC. Article Four Trust, a
F-30