Crash Proof Retirement Lawsuit: Price, Inquirer, and SEC Review

Crash Proof Retirement, the King of Prussia, Pennsylvania firm founded by the late Phillip J. Cannella III, has been tied to several lawsuits and legal disputes: a federal Lanham Act case it filed against a critic that a judge dismissed, a defamation suit it filed against the Philadelphia Inquirer, and a separate government ethics review triggered by a 2011 interview with a top SEC official. The company itself has said it proactively sues competitors and critics it believes are misrepresenting its methods.¹

The Lanham Act Suit Against Paul M. Price

The most fully documented case is Crash Proof Retirement, LLC v. Paul M. Price, filed in 2020 in the U.S. District Court for the Eastern District of Pennsylvania (Case No. 2:20-cv-05906-JDW).² Price, a former stockbroker, had written an article on TheStreet.com calling the Crash Proof system a “scam.” The company sued under the Lanham Act, alleging false advertising and trademark infringement, and argued that Price was a direct competitor whose article amounted to commercial speech steering customers away.³

Judge Joshua D. Wolson granted Price’s motion to dismiss. The court found that Price’s article did not propose a commercial transaction, did not promote any product or service, and showed no economic motive that would bring it within the Lanham Act’s reach. Wolson wrote: “Mr. Price told Crash Proof what it did not want to hear — that he thinks it’s a scam. But as much as Mr. Price’s opinion may irritate Crash Proof, it is not illegal under the Lanham Act because it is just that: an opinion.” Crash Proof was given until late April 2021 to file an amended complaint based on state law claims, or the case would be closed.³

The Defamation Suit Against the Philadelphia Inquirer

In April 2017, Cannella and Crash Proof Retirement announced they were suing the Philadelphia Inquirer for defamation. The suit was filed with representation from Richard Sprague of Sprague and Sprague.⁴ The specific allegations were not detailed in the announcement, and available records do not indicate how the case was ultimately resolved.

The Company’s Stated Litigation Posture

Crash Proof Retirement has said publicly that it files suits against competitors and critics it believes are trying to “steal our methods” or “spread false information” about its system, framing that activity as protection of its intellectual property and federally trademarked brand. The company denies that its system is a scam and states on its website that it has “protected over $5 billion in assets (and counting) without a single judgment or infraction filed against us.”¹

The SEC Inspector General Ethics Review

Not every legal matter tied to Crash Proof has been a lawsuit. In July 2011, Cannella conducted a 75-minute videotaped interview with H. David Kotz, then Inspector General of the U.S. Securities and Exchange Commission, at SEC headquarters. The interview covered the Bernie Madoff fraud, the SEC’s performance, and market volatility, and at one point Kotz remarked that it “may make sense to take things out [of the stock market] in turbulent times.”⁵

Cannella used the footage on his website, radio show, and at company seminars. The SEC’s general counsel’s office raised concerns that the video could be perceived as an official government endorsement. Kotz said he had cleared the interview with internal ethics counsel beforehand. The dispute was partially resolved when Cannella agreed to add a disclaimer stating that neither the SEC nor Kotz endorsed his firm, but he declined to remove the footage entirely, as the SEC had reportedly requested.⁵⁶

Kotz referred the matter to the Council of Inspectors General on Integrity and Efficiency. A later investigation by the U.S. Postal Service Inspector General found that Kotz’s personal relationships with certain individuals had created conflicts of interest in violation of ethics standards, though the broader allegations against him were largely unsubstantiated.⁷

Consumer Watchdog Criticism

Outside the courtroom, the firm has drawn scrutiny from the nonprofit Truth in Advertising (TINA.org), which published an analysis flagging several marketing concerns. TINA.org said the company’s promotional materials described the system as “immune to market losses” without fully disclosing that insurance companies can lower earnings caps on the underlying fixed index annuities, limiting upside potential in strong markets, and that early withdrawal penalties could produce losses for consumers who needed access to their money before a holding period expired.⁸

The group also flagged a company press release titled “President Obama Validates Phil Cannella and Crash Proof Retirement,” which TINA.org reported was not a news article or a presidential endorsement, but a press release attempting to link an anti-Wall Street speech Obama gave at AARP headquarters to the company’s products.⁸ Crash Proof points to nearly two decades of operation, a client base of more than 6,000 consumers, and a practice of recording all financial meetings with clients, which it presents as a consumer protection measure.⁹

1
Crash Proof Retirement. Crash Proof Retirement Lawsuit
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GovInfo. Crash Proof Retirement LLC v. Paul M. Price
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Newsweek. Pennsylvania Court Quotes Taylor Swift Song in Decision on Free Speech
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Retirement Media Inc. Philadelphia Inquirer Sued by Crash Proof Retirement
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Financial Advisor Magazine. SEC Official Scrutinized for Crash Proof Retirement Interview With Advisor
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Bloomberg. SEC Watchdog Bought Radio Hosts Eagles Tickets After Interview
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Government Executive. Former SEC Inspector General Challenges Allegations of Bias, Sexual Improprieties
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Truth in Advertising. Crash Proof Retirement
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Crash Proof Retirement. Dispelling the Myths About Annuities and the Crash Proof Retirement System