November 23, 2020

For Immediate Release

On November 20, 2020, the Office of the Insurance Commissioner for the State of Washington released the following on their website:

• “November 20, 2020
• OLYMPIA, Wash. – An administrative law judge upheld Insurance Commissioner Mike Kreidler’s fine and cease-and-desist order against Armed Citizens Legal Defense Network, Inc., for illegally acting as an insurer in Washington state. 
• 
  In March 2020, Kreidler ordered Armed Citizens to stop acting as an insurer. Armed Citizens sells memberships that include self-defense insurance to cover bail and legal costs incurred in conjunction with using force against another person. In May 2020, Kreidler fined Armed Citizens $200,000 for law violations.
• 
  “The bottom line is that this is about illegal insurance activity in Washington state,” said Kreidler. “Armed Citizens and other similar organizations try to cloud the issue by saying it’s about guns or about denying people their Second Amendment rights, which is untrue. At the end of the day, Armed Citizens and others like it are attempting to illegally operate as an insurer in Washington state and it’s my job to make sure that doesn’t happen.” 
• 
  Armed Citizens appealed both actions and an administrative law judge upheld Kreidler’s actions.   The judge amended the fine to $50,000 and ordered Armed Citizens to pay it by Dec. 7, 2020.
• 
  The judge’s ruling reads: “… ACLDN is transacting insurance in Washington. Thus, the Insurance Commissioner has authority to issue a cease and desist order and to issue a fine, under the provisions listed below.”
• 
  Armed Citizens can appeal the ruling to superior court until Dec. 7.
• 
  Armed Citizens, based in Onalaska, Wash., has sold memberships to over 17,000 people nationwide, including 2,559 in Washington state, since 2008. Its marketing materials promise “when a member uses force in self defense, the Network immediately sends up to $25,000 to the member's attorney and can provide up to $25,000 in bail assistance.” 
• From 2008 to 2019, 25 members nationwide filed claims. Two of the claims occurred in Washington — Armed Citizens paid $2,000 for one claim and denied the other one.
• Kreidler has taken similar enforcement action against four other organizations that sell or underwrite insurance for legal expenses and fined them a total of $302,000.
• 
  Armed Citizens and other similar organizations can legally sell insurance in Washington state by applying for admission as an insurer and complying with the laws and rules that apply to insurers and insurance producers. Consumers who want to purchase policies that cover legal expenses should contact an agent or broker.” 

The Armed Citizens’ Legal Defense Network, Inc. (ACLDN) is a for-profit business incorporated in Washington State, with its principal office in Onalaska, WA.  In business since 2008, ACLDN takes exception to the above press release, as it contains several glaring factual errors.

Primarily, an independent Administrative Law Judge (ALJ) did NOT hear the appeal, and the appeal was NOT ruled upon by an ALJ.  Instead, the hearing and motions were heard and ruled upon by a “Presiding Officer” (PO) who is an employee of Insurance Commissioner Michael Kreidler.  When ACLDN was first served with the Cease and Desist Order, it requested the hearing be heard by an independent ALJ, but the PO, Julia Eisentrout, denied the request.  ACLDN requested the ALJ because it was concerned about the appearance of fairness, that being to have an employee of the insurance commissioner rule upon an action of the insurance commissioner.  Bottom line, there was no judge involved in this ruling.

Additionally, in Kreidler’s remarks (above) he states:

“Armed Citizens and other similar organizations try to cloud the issue by saying it’s about guns or about denying people their Second Amendment rights, which is untrue. At the end of the day, Armed Citizens and others like it are attempting to illegally operate as an insurer in Washington state and it’s my job to make sure that doesn’t happen.” 

This statement by Kreidler is also patently false when he says it’s about guns and Second Amendment Rights.  

“We formed ACLDN specifically NOT as a gun rights organization, and nowhere in any of our web presence or marketing literature do we state otherwise.  Instead, after seeing the political prosecutions of armed citizens who have used force in lawful self-defense, we felt there was a need for an organization where law abiding armed citizens can gather to make sure they have the financial resources to fight unmeritorious prosecutions.

Furthermore, we are looking forward to getting the issue in front of a real judge and will be filing an appeal in Lewis County Superior Court on Monday, November 23rd, says Marty Hayes, ACLDN President.

Lastly, throughout their news release, the OIC uses words such as “claims” and makes the allegation that ACLDN is selling Insurance.  While other companies do have insurance components to their offerings, ACLDN does not, and will be proving that in court.” 

ACLDN will both be appealing the ruling and fine and is confident that when a real judge considers all the arguments, ACLDN will be exonerated.

If members of the media would like to discuss this further, please contact ACLDN President, Marty Hayes at 360-978-5200.